The House met at 1331.
QUEEN MOTHER’S VISIT
Mr Allen: On Thursday afternoon of this week at this Legislative Building, the Queen Mother will be officially welcomed to Ontario for a five-day visit to the province. Incredible as it may seem, the government is scurrying around trying to discover how it can keep the business of the House going that afternoon despite the presence of Her Majesty.
Whatever is happening to our sense of protocol around here, not to mention our sense of propriety, courtesy or even common respect? The Queen Mum is not only affectionately regarded by thousands upon thousands of Ontarians, but with her husband, George VI, she paid the first visit of a reigning monarch to this country. With him, she was an inspiration and tower of strength to many during the dark days of the Second World War.
The last thing I heard, we were still a monarchy. The last time I looked, symbols of the crown were all around us in this place. The crown still symbolizes the good things that are different about this country on this continent, not least of all a high sense of the importance of the public sector, a disinterested public service, and that there is a collectivity that lies beyond private interests and constrains us all.
I call on the government to do the right and proper thing and adjourn this House on Thursday afternoon as a mark of respect for the mother of our Queen and the things that she and our Queen symbolize.
SHRINE CLUB OF NORTH AMERICA
Mr McLean: My statement concerns the invasion of Toronto by more than 90,000 fez-topped Shriners, of whom I am sure the members are all aware by now. If not, they will certainly notice the Shriners after a week of activities including massive parades, a monster bingo, a fly-past and a sail-past, to name but a few of the events associated with this week’s 115th imperial session.
The Shiners have converged on Toronto to have fun, to share that fun with others and to inform the public about who Shriners are and what they do. Since the Shrine opened its first hospital in 1922, the Shriners have been active in helping those youngsters who, because of birth defects or accidents, have not had the opportunity to enjoy the fullness of a child’s life. The goals of the Shrine involve helping a crippled child to walk or a burned child to recover by providing the best possible treatment, free of charge to all, regardless of age, creed or relationship to the Shriner.
Since 1922 the Shrine has established a network of 19 orthopaedic and three burn hospitals throughout North America that provide the most up-to-date care and treatment. Just recently, the Toronto Rameses Shrine Temple gave the Hospital for Sick Children $1 million for a new patient care centre.
I would like to take this opportunity to welcome the more than 90,000 Shriners and their families to Toronto and remind all members of the Shriner’s motto, “No man stands as tall as when he stoops to help a child.”
T. J. AINSWORTH AND JERRY MACKINNON
Mr Neumann: I rise today to congratulate two young men from Brantford who have represented this province and country well at a competition in Washington, DC.
Last month, T. J. Ainsworth and Jerry MacKinnon competed in the 40th annual Plymouth-American Automobile Association Trouble Shooting Contest. Competing against teams representing all 50 US states, these young men placed 18th. Considering that this was the first time a Canadian team had competed in this event, this was quite an accomplishment.
In a timed competition, contestants had to fix a new car which was rigged with carburetor, ignition and electrical problems, as well as complete a one-and-a-half-hour written test.
Credit must be given to their teacher at Brantford Collegiate Institute and Vocational School, Bill Corner, and to the staff of Brantford Chrysler, who provided a car on which the two students could practice.
Skills training is becoming increasingly important in the 1980s as industry adapts to the changing role of technology. I believe the terrific result achieved by T. J. Ainsworth and Jerry MacKinnon is indicative of the fine job being done by educators in Brant county and elsewhere in Ontario. I hope that all members will join in congratulating these two young men on their outstanding showing in the Plymouth-American Automobile Association Trouble Shooting Contest.
Mr Allen: Plant closures continue to plague Hamilton and region. Just in the last few days we have heard of Chipman Chemicals in the east end, Greening Donald in the west end and Lundy Steel in Dunnville, and still we have no adequate plant closure legislation and inadequate adjustment services for employees.
Nobody knows how many Hamilton employees miss out on adjustment services, because there is no requirement to register small plant closures or the downsizing of less than 50 employees.
If you do get adjustment services, they vary incredibly. My staff did a survey of six closures. In the best three, between $500 and $2,000 was spent per adjustment per employee. The other three got between $21 and $115. Not surprisingly, the success rate in the placement of the first group in job and training placements was from 80 to 90 per cent, at equivalent wages, I might add, while the second group reached only 26 to 58 per cent, with no record of the wage levels in the jobs secured. The actual services themselves varied in a similar way in extent and quality, whether it was in résumé training or counselling or family support.
We need to readjust our adjustment services so that our displaced workers get fair and equal treatment. If workers are to accept industrial change without family trauma, loss of status and resources and if we want to build and not destroy skills and productivity in our workforce, we will move quickly to upgrade our employee adjustment programs.
Mr Jackson: On Thursday the Minister of Education (Mr Ward) introduced a bill to amend the Teachers’ Superannuation Act. He slipped it in on the day after school had closed for the summer, hoping that the teaching community would not notice, but the minister is surely mistaken if he thinks that draconian changes to the largest pension plan in the province, the third-largest pension plan in the country, will go unnoticed.
In September 1988, the government invited the teachers to negotiate a new pension deal that would make them full and equal partners in the management of the pension funds. By January, after negotiations broke down over time principle of a third-party dispute-resolution mechanism, the Liberals had decided to proceed with their own agenda: increased contribution rates; merging the two funds and hence eliminating the actuarial surplus, and refusing to consider early retirement benefits.
The Liberals are not even following the advice of David Slater, the consultant they hired to advise them on this important issue. What the Liberals have tabled is a manipulative document that puts a political face on a basic pension rights issue.
In Ontario we depend on the teachers to help our children understand good judgement and fairness. I trust the Treasurer (Mr R. F. Nixon), a former teacher, is listening. It looks as if the Liberals have forgotten this important early lesson on the treatment of our fellow citizens.
Mr Mahoney: I would like to share with members of this House some of the thoughts of the general manager of Peel Nonprofit Housing Corp in its 11th annual report that was released just recently.
Peter Smith says in his report that in his view 1988 was the year housing began to emerge as a major issue in the public consciousness and on political agendas. Serious attention was focused on how to meet the growing need for affordable housing. He says:
“At the provincial level, it was gratifying to see a real commitment backed by positive and meaningful initiatives. As an acknowledged leader in the housing field with 12 years of demonstrated experience in running one of the most successful housing programs in the country, PNPHC was able to seize upon this new climate of opportunity.
“PNPHC completed four new projects in 1988, adding 336 units to our growing portfolio, and at year end the total number of units under management and construction was 3,422, making PNPHC the largest landlord in the region of Peel.”
In October 1988 the corporation received an initial reserve allocation of 800 units under a new unilaterally funded provincial housing program entitled Homes Now. According to Mr Smith, this represents the greatest commitment shown by any provincial government to date for nonprofit housing. I congratulate Mr Smith and his corporation for a job well done.
STATEMENT BY THE MINISTRY
Hon Mr Phillips: All members of the House will be aware that a white supremacist organization, a neo-Nazi group, staged an event in Minden over the past weekend. As I said in the House recently, such actions are despicable and are contrary to our provincial policy on race relations. They must be condemned in the strongest possible terms.
After the recent incident involving a Jewish synagogue and school in Toronto, officials of my ministry’s race relations directorate and myself met with representatives of over 40 community groups. The results of those consultations have been, first, an outpouring of solidarity by community groups for the Jewish community and, second, development of plans for a forum on white supremacist activities and how they can be opposed in this province. This forum, facilitated by my ministry, will take place shortly.
In particular, the residents of Minden and many other individual citizens and groups are to be commended for their strong stand against racism. I know that all members of this House join with them in this stand.
I welcome the concerns expressed and the support shown by both of our official opposition parties in these matters, and I welcome their further suggestions and assistance.
Mr B. Rae: First, I want to pay tribute to the citizens of Minden. I am sure other members saw, as I did, the number of people who participated in rallies and clear statements, I think particularly talking to children, about the implications of this kind of rally anywhere in Ontario. People are really to be commended for simply having come forward in their own way and showing such a sense of outrage at this expression, particularly on Canada Day.
This expression of hatred and exclusion, this expression of a point of view and a feeling about Canada is just so unacceptable and out of keeping with not only the spirit of Canada Day but, I know, the views of the members of this assembly and the vast majority of Canadians across the country.
I would be willing, as I am sure other members would be willing -- and I do not want to speak for the leader of the third party, but I know that any of us would be willing to do whatever we can in a constructive way to put our resources to work in helping to educate the public about the implications of these kinds of events and in exploring ways in which our own laws in this province can indeed be strengthened as we face this problem.
I can remember when I was the federal member for Broadview-Greenwood and the Ku Klux Klan began operations again in the east end of Toronto. We were able, by working with a number of community groups, to basically drive the Klan away. Their activities became so unacceptable in the neighbourhood that people generally just rose up in opposition to this kind of white supremacist activity. I think working with a whole variety of community groups is the way to go, particularly working with kids, with schools and with people on the street, so we can fight this racism as it emerges and as it is expressed.
Particularly distressing for me is the way in which this rally appeared to be attended by a number of younger people, and that is something all of us have to be awake to, aware of and respond to.
The other thing I want to say is how very proud I am at the outpouring of support for the Jewish community in the face of this neo-Nazi smear on Shaarei Shomayim Synagogue. I do not know if members saw, but there were groups from across the multicultural and multireligious spectrum of our province, all of which raised money in order to contribute to the reward for any information that might lead to the arrest of a suspect in the incident at Shaarei Shomayim.
That made me feel very proud to be a Canadian, very proud of the extraordinary links that are being built up, because all of us understand of course that while our own group may not be the subject of an immediate attack it is fair to say that if a group or an individual is allowed to get away with a racist attack on one group, that attack will be followed by others. I think it has been quite marvellous the way a number of groups from the whole gamut of organizations -- church groups, religious affiliations, cultural communities and ethnic communities -- across the province have joined together, because I think everybody understands that racism is our common enemy. It is an enemy we all share and an enemy we must do more to fight.
I think the forum on white supremacist activities and how they can be opposed in this province is a good idea. I think that information and the glaring light of publicity are required in order to deal with this problem. It must never be allowed to become an underground problem. It must be something which we expose and which we do everything in our capacity to fight. I commend the minister for the work he is doing. As I say, on a purely nonpartisan basis, I am happy to offer my services or those of any member of my caucus at any rallies or forums he may be involved in, to make sure the word gets through and the word gets out that racism simply has no place in Ontario.
Mr Brandt: I am honoured to have this opportunity to associate my party with the remarks of the minister, who I think has acted responsibly and precipitously in respect to the matter of major concern in Minden that occurred this past weekend. I want to associate myself as well -- it does not happen often in this House that you can find agreement from all three parties--with the remarks made by my colleague and friend the Leader of the Opposition.
The kind of racism that reared its ugly head during the course of the white supremacists’ rally that occurred in Minden is the kind of thing that should concern each and every member of this Legislature, and I know that it does. It is the kind of insidious rally sponsored by unthinking people for the distasteful purpose of picking on groups and organizations that, in some instances, perhaps are not able or are not in a position to defend themselves. I think that is why society has a very clear responsibility and has a very clear requirement, if you will, to protect all members of society in the kind of Ontario we are attempting to develop here in this province of ours.
I would like to say, as well, that I think it points out that when a situation develops, as it did in Minden, citizens who understand the kinds of concerns we share in this House did rally in support of the other side of the issue and indicated very strongly the fact that this group was not welcome in their community. They were helped, I believe, by the local newspaper in that effort, with the display of certain signs indicating that they were not a racist community and did not particularly welcome the kind of carrying on that took place at that particular time.
As the minister noted in his comments, I think it also points out the need for continued education, the need for the continued sharing of ideas with respect to how troublesome these kinds of activities are and how dangerous they can well be if allowed to grow, to fester and to continue unchallenged. They can be challenged very directly in the kind of educational forum the minister is talking about.
The white supremacists have absolutely no role to play in this province of ours under any conditions. We have worked very hard to develop a tolerant province, a province that is sensitive to a wide diversification of ethnic groups, nationalities and religions. The only way we can hope to continue to build on that kind of fundamental base that we have attracted to this province is to make sure that we do not allow the kind of thing that happened to occur in Minden. It was no reflection on that community; it just happens to be where they decided to hold this particular distasteful event.
But the only way we can stop that sort of thing is by the continued effort that I think we all have to make to educate the public generally as to what difficulties this kind of sickness -- and I call it that with due thought for the meaning of the word -- can cause in our society. So I congratulate the minister. Let’s work together collectively, all three parties, to make this a more tolerant and more sensitive Ontario for all of us.
ENVACC RESOURCES INC
Mr B. Rae: I have a question to the Minister of the Environment. I wonder if the minister could tell the House, following the questions I put to him last week, exactly what discussions took place between members of his staff and Mr Muzzo’s Envacc Resources Inc group, when those discussions took place and what briefing material the minister received as a result of those meetings.
Hon Mr Bradley: The only meetings I could think of that they would have been involved in would have been to explain the environmental assessment process for long-term greater Toronto area ideas. That would have been around the same time, I would think, that the people met with the Premier (Mr Peterson).
What they would do with a private sector person who would be potentially making a proposal is that often these people will come forward to ask what regime must be followed and what procedures there are in the environmental assessment process. They would outline the procedures for the long-term environmental assessment that would take place according to any GTA proposals.
Mr B. Rae: I am sending the minister a copy of a memorandum which is from Harry Poch, who is one of the lawyers at the law firm of Gardiner, Roberts. The memorandum is dated 8 December 1988 It is addressed to Mr Beatty, who is general counsel to that firm. This memorandum outlines certain discussions that were held apparently between Mr Poch and Mr Gallon, who is the minister’s special assistant for policy.
Can the minister tell us why Mr Gallon indicated to Mr Poch, as it would appear at the bottom of page 2, the names of the competitors to the Envacc group, and why in particular Mr Gallon would have said to Mr Poch, according to this memorandum, “Jim Bradley is supportive of the private sector if it comes in with community support, and he would scope the environmental assessment process to ensure its efficiency”? Can the minister explain why Mr Gallon would be saying these things to Mr Poch?
Hon Mr Bradley: I think I indicated clearly that the greater Toronto area proposal that would come forward would in fact be subjected to the full Environmental Assessment Act provisions. I think that when the Premier made the presentation to the regional councillors and representatives of the various communities who were present at the presentation, he indicated on that occasion that in fact it would be subject to the full provisions of the Environmental Assessment Act.
As the member would know, our policy is that it is not necessarily whether it is a public- or private-sector proposal that would come forward; it would be subject to the same rules, for instance, as it would relate to a landfill of this kind, if that were indeed the proposal.
Mr B. Rae: This document shows that a very senior member of the minister’s staff not only was giving to one company, Envacc, the names of its competitors and the principals of its competitors but also, he was giving information with respect to the minister’s private views, for example, his views on Mr Muzzo, Mr Church and the fact that apparently the minister is worried about Mr Gardner Church. It also gives views as to which would be the willing host communities, lists those communities and indicates precisely what material is going to be discussed by cabinet next Wednesday -- that is to say, the Wednesday after 8 December 1988.
How does the minister feel about a member of his staff, according to Mr Poch and to this memorandum, indicating information on the names of competitors of Envacc, giving details of information to be going to cabinet and details of the minister’s own point of view with respect to this very sensitive matter?
Hon Mr Bradley: I can say only that this is a memorandum from one individual to another individual, and I cannot verify the accuracy of the statements that are contained in here. The member has handed me a document which is a memorandum. It is one person’s assessment of what went on at a meeting. I was not at such a meeting. I do not know if this is a correct assessment.
PROPOSED POLICE COMMISSION APPOINTMENT
Mr B. Rae: My new question is to the Attorney General. The Attorney General will know that in the Toronto Sun last week under the column of Diane Francis there appeared an account of the appointment, or nonappointment, of Mr DelZotto to the police commission, which is dramatically at odds with the account given by the Premier (Mr Peterson) and by the Attorney General. The account given by Ms Francis indicates conversations that she had with the member for Kingston and The Islands (Mr Keyes), and that as late as 1987 Mr DelZotto’s name was still on the list of 50 names, potentially for the police commission appointment.
I wonder if the Attorney General can possibly explain how Ms Francis’s account is so dramatically different from the information provided to this House by the Premier and himself.
Hon Mr Scott: I cannot explain all those things in the newspapers, but what I can tell the honourable member is what I have told him before about my own and the Premier’s role in the process.
In early 1986 it came to my attention that Mr DelZotto was being considered for this appointment. I went to see the Premier about it, expressed my views and as far as I knew, that was the end of the matter and the appointment was never made. I am quite certain that if it had continued to be on the agenda, I would have heard about it the way I heard about in May 1986, and I did not. Nothing ever came of it and one cannot make all that much out of that.
Mr B. Rae: With respect, we cannot ask the Premier, because he is in Brussels; we cannot ask the former Solicitor General, because he is no longer a member of the cabinet and he will not answer.
Hon Mr Scott: Don’t make me feel as if I’m third on the list.
Mr B. Rae: We have no choice but to go back to the Attorney General.
Hon Mr Scott: I have some priority here.
The Speaker: Order.
Mr B. Rae: I think we are entitled to know from the Attorney General how he can explain the fact that for 18 months Mr DelZotto’s name appeared to be before the government for an appointment to the Ontario Police Commission. How is it possible that on the second round in 1987 Mr DelZotto’s name would appear again on that list for appointments to the police commission?
Hon Mr Scott: I know the honourable member regards me as third-rate. He has to ask me questions and I have to answer his. But let me say to him I believe that if this appointment was considered after May 1986 I would have heard about it. I heard about it in the first place, expressed my views about it immediately and was told that the matter was not on the agenda.
I am quite satisfied that if it had come up again, I would have heard about it, if not before cabinet, certainly at cabinet. The reality, whatever some reporter out there is saying, is I was there and it did not come up again, to my knowledge.
Mr B. Rae: The key words are “to my knowledge.” Can the Attorney General tell us --
Hon Mr Scott: Well, what do you want to ask me about except my knowledge. You asked me about Diane Francis’s knowledge.
The Speaker: Order.
Mr B. Rae: All right then. Can the Attorney General confirm or deny -- or does he know -- when in June 1987 Ms Francis says, “I interview Keyes and he says DelZotto is one of 50 names on his list for the appointment,” can the Attorney General explain if the name was not anywhere to be found and if the decision had been made in 1986, how is it possible that in June 1987 his former colleague, who was Solicitor General at that time, would be saying that Mr DelZotto’s name was one of 50 names on the list?
Hon Mr Scott: All I can say is that I have been Attorney General throughout the piece. I served as Solicitor General for about eight weeks and I am Solicitor General again.
Mr Mackenzie: Look at all the trouble we’re in.
Hon Mr Scott: Just keep quiet, Mackenzie, for two minutes.
I can tell the honourable member, with all the assurance I can give, that the name did not come up or come to my attention after 1986. I cannot explain what Ms Francis is writing. I can simply give the honourable member the facts of the case.
It is one thing to criticize us for making an appointment. It seems to me that it is sparring in the air to criticize us for not making an appointment that the member would not have us make.
The Speaker: Order.
Mr Brandt: My question is for the Deputy Premier. I would like to say, if I might, that the Attorney General might think of himself as third-rate in response to the question raised by the Leader of the Opposition, and we value his opinion in that regard on this side of the House.
The Speaker: The question?
PREMIER’S OFFICE LEGAL COUNSEL
Mr Brandt: My question to the Deputy Premier is with respect to the hiring of Stephen Goudge, the lawyer who has now been hired to investigate certain activities that have occurred in the Office of the Premier. I wonder if the Deputy Premier would mind sharing some information with the members of the opposition with regard to who is now paying for this lawyer’s fees in the investigation being carried out. Second, would the Deputy Premier indicate who the lawyer will be representing in an official way?
Hon R. F. Nixon: The Attorney General has volunteered to answer that question.
Mr Brandt: I didn’t want to deal with any third-rate people, though.
The Speaker: Order. It has been referred to the Attorney General.
Hon Mr Scott: Mr Goudge was taken on the staff of the Premier’s office, with I think one other person, some time last week. I am not certain how he is being paid, but I presume it is in the normal budget of the Premier’s office. If it is not, I will make inquiries and try to let the honourable member know.
Mr Brandt: Effectively what the Attorney General is saying then is that the taxpayers of Ontario are going to be paying for that, if that person has been taken on staff in the regular turn of events that occurs.
I would like to ask the Attorney General, since on a number of occasions the Premier has indicated that a certain Attorney General has the best legal mind that he knows of -- of course, he does not know everybody, but of those he knows -- and he also has a very substantial legal staff available to him in the Attorney General’s office, why is it now necessary, if this is going to be at taxpayers’ expense, that we now hire another lawyer who is going to cost additional dollars? Why is that so necessary?
Hon Mr Scott: I will explain to the honourable member. As a result of the investigations that are under way, it may be necessary for the Attorney General or the crown law staff to give advice to investigating police officers as to whether charges should be laid.
I regard it as improper for me and my staff to participate in any way, therefore, in giving advice to the Premier’s office on legal matters. The position of the civil law division of the ministry is no different. This is the practice that has been followed routinely under the previous government, and in those circumstances, I simply have to say I cannot give advice. It is in that context that a staff member -- there was a vacancy, as the member will recall -- has been taken on in the Premiers office.
Mr Brandt: I appreciate the Attorney General’s making such a precise differentiation between the role that this lawyer would play in the Premier’s office and the need for arm’s-length relationships in his ministry. I am glad he pointed that out. It raises the question of why then his staff, or he personally, has already had meetings with Mr Goudge in order to consult with him with respect to how this entire matter is going to unfold.
On the one hand, the Attorney General is saying that he wants this to be totally arm’s-length in order to appear, in the public’s mind, that there is not a relationship; on the other hand, he has already had these discussions. How can he have it both ways?
Hon Mr Scott: It will be my duty to bring to the executive council a draft order in council for the establishment of the judicial inquiry, which requires a cabinet minute.
I have indicated to everybody, particularly my honourable friend and the Leader of the Opposition (Mr B. Rae), that I would be glad to consult with them about that matter. I have heard from the Leader of the Opposition in the usual way, through the press., and have taken full account of his views. I have met with the honourable the leader of the third party and his House leader in private to have their view’s on the scope of the inquiry. I have met today with the Chief Justice of Ontario. I have met with a number of other people, including the staff of the Premiers office, to get their input as to the form of the order in council in draft that I should bring to cabinet.
What cabinet approves is, of course, for cabinet to say. It may bear every relation or no relation to my recommendation.
The Speaker: The member for Cochrane South.
Hon Mr Scott: But it was good to see you there, Andy.
Mr Brandt: I was delighted to be there. Sorry you wouldn’t listen to reason.
The Speaker: Order.
Mr Pope: The Attorney General does not see anything wrong with his meeting with Mr Goudge. That says something about --
The Speaker: Thank you. Your question is to which minister?
Mr Pope: My question is to the Attorney General. Since he knows quite a bit about this, obviously, can the Attorney General tell me whether Mr Goudge has gone on leave or has departed Gowling and Henderson? Is he no longer in their employ? Is he just on leave? Is he going to return there after his tenure in the Premier’s office? Just what exactly is going on over there as Mr Goudge is once again brought into a conflict-of-interest issue, an ethics issue, involving the Liberals of this province?
Hon Mr Scott: It is very difficult to take ethical direction from my friend, but let me very frankly say that I do not know the answers to those questions. The Premier’s office retains its own staff, and it has made the determination in this case to retain Mr Goudge.
Mr Pope: The Attorney General knew that he had joined the staff of the Premier’s office, but he does not know the terms of that employment, even though he has been selected by the Deputy Premier to be the spokesman for the government on this issue.
We want to know exactly the relationship of Mr Goudge to the Premier’s office, who made the call to get him in here again, as in 1986 when the government had two inquiries going on and he was retained by the Liberal caucus. We are entitled to know how the public’s money is being spent. Who made the call? Who hired him? I want the individual in the Premier’s office.
The Attorney General is the spokesman for the government on this issue. He appointed himself. Now, he should answer those questions.
Hon Mr Scott: I will undertake to inquire about when Mr Goudge was hired, the circumstances under which he was hired, that is, whether he is full-time or part-time, and I will undertake to ascertain how he is being paid, that is to say, whether it is within the Premier’s office budget or otherwise.
Mr Pope: This is the same Mr Goudge who was retained in 1986 by the Liberal caucus with respect to two inquiries that went on during the summer and fall of that year. Can the Attorney General tell us why the Office of the Premier feels it necessary to retain counsel for this inquiry, which is the way it was put out to the public last week? What has he got by way of knowledge or conduct that he needs to hire a lawyer for?
Hon Mr Scott: That question, as usual, is scraping the barrel. I have never seen such McCarthyism in my life in this place, but that does not surprise me at all. Let me say one thing. The reason is that the Attorney General of the day -- maybe the Conservatives did not do it this way -- is not able to give legal advice to the Premier’s office when an investigation is under way, because I have the obligation to give advice to the police, which I intend to do absolutely independently. So the Premier’s office is bereft of the legal advice that is normally available to it in a noncontentious matter. That is why, no doubt, the Premier’s office decided to retain Mr Goudge.
The Speaker: Order.
OCCUPATIONAL HEALTH AND SAFETY
Mr Morin-Strom: I have a question for the Minister of Industry, Trade and Technology with respect to his involvement in Bill 208, an act to improve occupational health and safety in Ontario. The minister and his senior officials have been working together with a coalition of industry associations called the Bill 208 Business Coalition, whose intense purpose is quite clearly to kill this bill.
I would like to ask the minister: What specific involvement has he had with this business coalition, what is his position on this bill and why is he as the Minister of Industry, Trade and Technology getting directly involved with a bill that is the responsibility of the Minister of Labour (Mr Sorbara)?
Hon Mr Kwinter: The member has presented that question once before and he has a total misconception of what this bill is. Bill 208 is an occupational health and safety bill but it also deals in its broadest sense with training and the ability of our competitiveness. He absolutely knows that, yet he is standing up making accusations without any thought of what this bill means to not only labour and business but the total economy of Ontario. To suggest that I, as the Minister of Industry, Trade and Technology, should not be listening to groups that make up the client groups of my ministry is patently ridiculous.
Mr Morin-Strom: This minister received in one event alone last fall more than $60,000 in contributions from the business community. This minister, rather than taking an independent, objective view of this bill, has become the protector of the business interest on it.
The Speaker: Order.
Mr Morin-Strom: Can this minister tell us specifically what meetings he has had with these business associations and what his specific position is on the bill? Is he in favour of the bill or is he against it? Does he want it stalled or does he want it killed?
Hon Mr Kwinter: I did not hear the total question, but I assume the honourable member was asking: What is my involvement in the bill, am I for it or against it and what is my position on it? Is that a fair estimate of what he said?
Mr Pouliot: Right.
Hon Mr Kwinter: This is a bill, as I said earlier, that cuts across the total economy. As the Minister of Industry, Trade and Technology, I make no apology for being the champion of business. I make no apology for that at all.
When a business group thinks that it is having a problem with any other ministry in the government, I have an obligation to bring its concerns to those people. That is my role. My role is to present its concerns and then the process, whether it be cabinet or whether it be a committee of this Legislature, will deal with it. But certainly the member would not deny a group that provides the jobs, that provides the buoyant economy that we have, a right to have access to that process.
The Speaker: Order.
Mr Jackson: My question is to the Minister of Health. The minister and her ministry have been aware since January 1989 of the crisis conditions which are facing the neonatal intensive care unit at Chedoke McMaster Hospitals. She would also be aware that this is a regional service for approximately 1.8 million people in southwestern Ontario.
The minister should also be aware that the beds in this program have recently been cut from 33 down to 30 and that, in the last month, 16 high-risk babies were turned away from this program because of facilities that were not up to demand.
My question is, why does her ministry refuse to look at the necessary provincial funding to restore the neonatal intensive care unit at Chedoke McMaster to a safe and responsible level?
Hon Mrs Caplan: I would like to reject the premises upon which the member places his question and tell him that at present the capacity of our perinatal system in this province meets the recommendations of the report of the Advisory Committee on Reproductive Care.
Chedoke McMaster is but one of a network of numbers of hospitals which provide highly specialized perinatal and neonatal care. I can say to the member that it is very common for one part of that system to be stressed at any one time and for another part to be underutilized. That is why the system is connected both by land and air ambulances: so we can make sure that mothers and their babies who require this highly specialized care have access to it as quickly as possible and as close to home as possible.
Mr Jackson: The facts that have been emerging both by conversations with Chedoke McMaster and recent press reports would indicate that the minister is not working with all the facts. These are critical matters.
Without an intensive care bed for a baby in need at Chedoke McMaster, they cannot accept a pregnant mother into obstetrics. Therefore, according to the doctors at the hospital, what has been happening is that they are causing more babies to be transported and, using their own words, it is increasing the chances of death and injury.
Just this last weekend, four high-risk babies were turned away from the Chedoke McMaster program. On the weekend, a doctor spent over six hours trying to get a newborn baby with severe internal haemorrhaging in from the Henderson General Hospital -- it took six hours to free up a bed.
Now that the minister has received the studies, which are three years old, and her own ministry people have been pleading with the hospital not to reduce the service, will she confirm that she will fund five additional beds --
The Speaker: You have already completed the question.
Hon Mrs Caplan: I would say again to the member that we have a province-wide system which is designed to ensure that women in high-risk situations receive the very best possible care as close to home as possible. I would say to him that we have 13 participating hospitals which are now linked by a computerized registry.
We are always and at all times reviewing the capacity in the system. I would say to the member that at the present time the capacity of the total system in fact exceeds that recommended by the Advisory Committee on Reproductive Care and that we are at all times working with the participating members of that system to ensure that we have the province-wide capacity to meet the anticipated needs.
If the member has any specific situation he is concerned about it, I would be pleased to investigate, but the information that we have is that in fact the system is working well.
Ms Hart: My question is to the Chairman of the Management Board of Cabinet. We all know that weekly community newspapers are a valuable source of local news and information, not only in small communities but also in the many municipalities that make up Metropolitan Toronto.
In my riding of York East alone there are several excellent community newspapers, among them the East York Times, the East End News and the Leaside Town Crier. These publications rely upon the revenue generated through advertising sales to a variety of customers, including the Ontario government.
Would the Chairman of the Management Board of Cabinet tell the House what criteria the government uses when deciding whether to place a particular paid advertisement in a weekly community newspaper as opposed to a large daily paper?
Hon Mr Elston: Basically, the criteria in placing any advertisements with respect to government programming are based on the coverage by each individual newspaper, whether it be a weekly, monthly or daily paper. It is in the best interests of each of the ministries to program its own publication of advertisements so that the largest number of people for whom it provides service can be alerted to the excellent programs which are available to the people of Ontario.
The criteria are how we get the coverage, where the papers are located and what other sorts of coverages are in place But I have never doubted for a moment the necessity of weekly papers as a valuable instrument of making the people of Ontario knowledgeable about the excellent programs that this government is providing to the people.
Ms Hart: Surveys have shown that three out of four people read their community newspaper cover to cover and keep any single edition in the home for more than a week. This cannot be said for daily newspapers. Yet several publishers of community newspapers have expressed concern to me that the Ontario government has recently cut back its advertising in their newspapers and adopted a new policy which favours the wider-circulation dailies.
Is there any foundation to these concerns, and what assurances can be given to the publishers of weekly community newspapers that they will continue to benefit from the Ontario government’s advertising campaigns?
Hon Mr Elston: The role of placement of advertisements in any newspapers in Ontario is to ensure that the people know about what is happening and what government programs are available. It is not in any way to be confused with sustaining any particular operation of any newspaper: daily, weekly or monthly, however often it comes out. The critical test for any of us must be whether the paper reaches a market that is not reached otherwise. Is it an effective way of communicating the news to people? Is it an effective way of making sure the programs are widely known and understood by the public?
I can say, coming from an area where weekly papers play an extremely strong role in communicating government policy and daily news from around the very large riding of Bruce, that we make sure that the key test, which is knowledge availability, is the one that is applied and not just whether there is a wide distribution for a daily paper. So the weeklies play a very big part. Our policies have not changed in that direction and in fact we would like to be absolutely assured that the various community --
The Speaker: Thank you.
Mr Reville: My question is for the Minister of Industry, Trade and Technology. Inspired as I was by his advertisement that he is the champion for industry, I understand that it was on his intervention on behalf of Glaxo, a drug manufacturer, that he has interceded in a professional and medical examination of drugs with respect to the Apotex drug that is a generic drug called Apo-Salvent. He, on the other hand, thinks the Glaxo drug Ventolin is a better drug.
Could the Minister of Industry, Trade and Technology explain whether he has some pharmacological expertise, why he did not go to the Minister of Health (Mrs Caplan) and why he thought he had better take this matter to cabinet and again undercut the Drug Quality and Therapeutics Committee, as this government is fond of doing?
Hon Mr Kwinter: The member talks to me about the qualities of the drug, and I think the Minister of Health can respond to that.
The Speaker: It has been referred to the Minister of Health.
Hon Mrs Caplan: As the member knows, we rely on expert advice from the Drug Quality and Therapeutics Committee when it gives us the assurance that generic drugs are in fact interchangeable with brand-name drugs and offer the very best and the same therapeutic results as brand-name drugs. He knows that our interest is of course the very best of therapeutic results.
A number of concerns had been raised, not only by the manufacturer of the brand-name drug but also by consumer groups: the Canadian Lung Association, the Ontario Thoracic Association and the Allergy Information Association. Cabinet thought it was prudent to make sure that all these concerns were addressed and the matter has been referred to the Drug Quality and Therapeutics Committee for its advice.
Mr Reville: The drug programs branch, a branch that reports, I assume, to this minister and not to that minister, wrote on 15 June that Apotex drug Apo-Salvent had in fact been recommended for listing in edition 27 of the Drug Benefit Formulary. This is the little book that tells physicians the drugs they can prescribe and expect to have paid for by the Ontario drug benefit plan.
The Ministry of Health approved this drug apparently until the intervention of the Ministry of Industry, Trade and Technology, with the result that this book has not been released. It is the book we all need, precisely after the 15 December cutbacks and special authorizations, to know which drugs doctors should prescribe for their patients. Whatever is going on?
Hon Mrs Caplan: In fact, cabinet acted prudently to ensure that concerns regarding quality and very best of therapeutic results were heard. I would say to the member that the Drug Quality and Therapeutics Committee will be hearing both companies with interests in this matter.
The Speaker: Order.
Hon Mrs Caplan: I expect they will be hearing this matter within the next week and then reporting to cabinet their very best judgement. We expect their decision shortly, so that the new formulary will not be held up unduly. I want to assure the member as well as all those concerned, that the concerns which have been raised will be thoroughly aired before the Drug Quality and Therapeutics Committee so that the interest of the best therapeutic results will be heard.
Mr Brandt: To the Minister of Industry, Trade and Technology: Was the minister aware of the fact, when he had representations with respect to the drug, that the ultimate cost to the taxpayer would be in the millions of dollars as a result of not using the generic equivalent that was available? What representations would he make to both his cabinet colleagues and the Minister of Health with respect to the economics of the matter as opposed to the pharmaceutical value of that particular drug?
Hon Mr Kwinter: I think I should tell the leader of the third party the situation. We have a situation where there is a drug that has not been approved in any jurisdiction in Canada. It was once approved by Quebec and then withdrawn. I had representations by Glaxo, the manufacturer. I am sure the leader of the third party will say, in all fairness, that I immediately had representations by a former colleague of his and the representatives of Apotex who told me their concerns. All I did was convey their concerns to the minister. That is where the situation is. It was not my determination as to whether it was right or wrong; it was my determination to convey their concerns. That is where the matter is now and that is where it will be.
The Speaker: Order.
Mr Brandt: I specifically asked the minister to respond to a question on the basis of the economics of the situation. I think a reasonable response from the minister might suggest some of the research activities that could be forgone as a result of one drug being picked over the other. All I am asking is for the minister to give us some indication of the position he took with respect to the economics of it. This drug has in fact been recommended. It is only a question of the minister’s authorizing its use now in an official way. The recommendation is on the table. It is either correct or incorrect and he can make that determination.
My understanding is that he is waiting now to accept the drug as being usable in Ontario, but what I want to elicit from the minister is some indication of what he actually did with these representations and what he did with respect to the economics of the situation.
Hon Mr Kwinter: I think the leader of the third party has a misapprehension of what went on. These concerns were raised with me; they were raised with me on the part of both parties and I did in fact convey those concerns. That was the extent of my involvement; I conveyed their concerns. The decision was taken in co-operation with the Ministry of Health and the cabinet. My role was to convey their concerns, which I did.
Ms Collins: My question is to the Minister of Health. As the minister knows, the disease known as diabetes affects hundreds of thousands of people in this province. Kidney failure, blindness, heart attack and stroke are just a few of the potential consequences of this deadly disease. The minister also knows that early diagnosis and proper treatment of the disease significantly reduce the severity of the disease. However, treatment across the province is unequal in its application because techniques and technology are not shared as readily as they should be.
Could the minister consider establishing a position of diabetes co-ordinator in her ministry to implement an integrated approach to the health management of diabetes?
Hon Mrs Caplan: I would like to acknowledge the member’s interest in this particular health care issue; I know she has raised this with me. Her question acknowledges the fact that the ministry has undergone a significant reorganization within the past year with the appointment of several co-ordinators who often have responsibilities in the area of disease-specific entities or services or target groups.
There are now seven co-ordinators within the ministry in the following areas: mental health, AIDS, emergency services, cardiovascular care, cancer care, women’s health and native health. I would say to her that senior ministry officials met recently with representatives of the Canadian Diabetes Association, Ontario Division, to discuss the possibility of a diabetes co-ordinator.
Ms Collins: As I stated in my first question, the early diagnosis and treatment of this disease significantly reduces the mortality rate from diabetes, allows diabetics to lead full lives and thereby reduces the strain on the health care system. Could the minister inform the House what her ministry is doing to promote public awareness of the disease?
Hon Mrs Caplan: The member opposite raises a good point. It should be noted as well that there is a well-established network of diabetic services and support groups throughout the province. It is for this reason that a diabetes co-ordinator may not be seen as an urgent priority at this time.
However, it is important to note that as part of this well-established network, many hospitals in the province provide these services, generally on an outpatient basis. The health promotion branch funds a number of programs in the awareness and prevention strategies of the ministry. The public health branch works with both hospitals and the home care program in follow-up counselling. It is important to note as well that some 8,000 patients with diabetes, or some five percent of all of the home care recipients, fell into this category last year and that the ministry’s health research grants fund support for diabetic research.
I am very aware of the member’s interest in this and I want her to know we intend to continue these activities and these initiatives to ensure that Ontarians and Ontario residents receive the very best possible services for the treatment, care and prevention of diabetes.
OCCUPATIONAL HEALTH AND SAFETY
Mr Mackenzie: I have a question of the Minister of Labour. I hope he heard the comments of the Minister of Industry, Trade and Technology (Mr Kwinter) about being a champion of business. Can the Minister of Labour tell this House how Triple-M-Demolition, operating on Stelco property, charged with the demolition of the huge old number three open hearth furnaces, which are literally as big as a stadium and contaminated with asbestos and stored transformers, could and would order one of the minister’s own inspectors, Mr Haber, who was accompanied by Local 1005 health and safety officials, off the site and why he would immediately comply and leave the site even though he indicated he was a ministry inspector?
Hon Mr Sorbara: I am simply unaware that one of our inspectors was, as the member suggests, ordered off the site at that demolition project. I will undertake to look into it, and if there is anything further to report to him, I certainly would be willing to do that.
Mr Mackenzie: It will not be hard to verify. The very next day the ministry inspector, Mr Haber, said he was calling a meeting of Stelco, the union and Triple-M-Demolition. Stelco refused to attend. The Local 1005 health and safety reps were not allowed to attend. Following the meeting, Triple-M-Demolition officials requested that Local 1005 contact them if they had any further concerns concerning health and safety on the site.
Is this a further indication of the impotence of the minister’s inspectors or is it an indication of the emerging fact that the construction industry is really running the show in cases like this?
Hon Mr Sorbara: It is not an indication of any such thing. Let me just make the point with my friend the member for Hamilton East that this government has put into place very strict provisions and regulations regarding the handling of asbestos. Through our inspectorate and joint health and safety committees, we are there to see those regulations are in place.
Let me make a point about the construction industry as well. The member will notice that in Bill 208 there are very specific provisions that will give us for the first time joint health and safety committees within the construction industry to ensure that when we are building facilities and when we are taking them down, we put the top priority on the health and safety of the people who are doing that work.
SALE OF BEER IN STADIUMS
Mr Runciman: My question is for the Ministry of Consumer and Commercial Relations and deals with a press report in today’s Toronto Star newspaper, dealing with his rejection of the London Tigers baseball team for a licence to sell beer in Labatt Park in London. The minister is aware that the government is allowing five other stadiums, professional football and soccer teams, to sell beer products in those stadiums in the province. Would the minister explain the rationale behind prohibiting the London team from doing the same.
Hon Mr Wrye: I would have hoped my friend the member for Leeds-Grenville had read instant Hansard. He would have been able to read the answer to a similar question asked by his leader last week. I will try again. The leader of the third party has now sent the question on to the member for Leeds-Grenville.
Very briefly, as I told the leader last week, as he knows, a pilot project was started about 1983 and it was determined during the time the pilot project has been under way that while it has worked well in some areas, it has not been without problems. Consequently, we have essentially decided to retain the status quo, which in effect is to transfer the licence from Exhibition Stadium to the SkyDome, because as the member now knows, that is where both the Blue Jays and the Argos play.
We have retained Exhibition Stadium in the case of professional soccer, although my understanding is that there will be no licensed games at Exhibition Stadium in the foreseeable future. Essentially, it is the status quo with a number of other changes the member may want to ask about in a supplementary.
Mr Runciman: I pointed out earlier today that the London Tigers is the only double A pro team in Ontario, the only club in the league, prohibited from selling beer at baseball games. Ottawa is attempting to secure a triple A baseball team, we hope starting in the next few years. I wonder if the minister is prepared to review the policy, so that it applies to professional sports teams in this province operating in a variety of stadiums throughout the province rather than restricting it essentially to major metropolitan areas like Toronto.
Hon Mr Wrye: The honourable member raises the dilemma we faced and considered and ultimately rejected. Perhaps he may reach a different conclusion, but I would suggest that had we extended the selling of beer in stadiums to Labatt Park in London under the aegis of being a professional stadium, we would have then had to consider the three single A stadiums that are now in place in Ontario, the three single A teams, and perhaps any triple A teams that might be in place in the future.
For now, I think the concern of the cabinet was that the allowing of beer and alcoholic beverages in baseball parks and football parks had not been without its problems. We want to continue in what is essentially still a pilot project in those larger facilities to try to see whether, with a number of new initiatives we brought in, some of those problems could be resolved. That is why we took the decision we did.
Mrs E. J. Smith: I would like to direct my question to the Minister of Colleges and Universities. It has been brought to my attention in London that there has been a statement made by the University of Western Ontario that it will be restricting enrolment of first-year students this year. I am very concerned to hear from the minister whether in fact this is true, what effect it will have on Western’s enrolment and indeed what effect it will have on the enrolment and capacity of the university system in Ontario.
Hon Mrs McLeod: I appreciate the question because it gives me an opportunity to clarify our expectations about enrolment in Ontario’s universities for this coming fall. I confess I was a little bit surprised at some recent statements of the Council of Ontario Universities about very high levels of demand, because my understanding of the information from the council was that the increase in secondary school applicants was something in the order of 0.4 per cent over last year.
Having said that, that is a continuance of very high levels of demand and I do recognize that, as always, the universities are responsible for their own admission decisions. I think it is important to note that in the past two years, with record high numbers of applications, the universities have responded very positively, including the University of Western Ontario, and are supported by some $88 million in accessibility funding.
Members will be aware that we have announced just recently a further precommitment of funding in the next budget for universities that maintain very high levels of first-year enrolment and that experience growth as a result. That has been very positively received by all the universities. I am quite confident that across the system we will be able to maintain as a minimum the traditional 65 per cent of applicants finding admission.
Mrs E. J. Smith: Then I assume the minister is reassuring me and the House that there will be no negative impact and that qualified students throughout this province will find an appropriate place this fall when enrolments are completed throughout the province.
Hon Mrs McLeod: As I indicated, I am quite confident that with the support we have put in place, the universities will be able to respond to this year’s demand for places. I think it is most significant for the universities that we have been able to commit this further $46.7 million in the next budget and add it to the $88 million in the current budget for accessibility. They will be able to make places available in those first-year classes.
There are two other factors that I just would like to recognize as influencing the universities’ admissions decisions. One is a commitment to continuing to provide support for those universities that maintain their high levels of first-year admissions and experience growth in the system as a result. The other is our commitment to incorporate this funding into the base budgets of universities that do maintain these very high levels of enrolment.
Mr Wildman: I have a question to the Minister of Natural Resources. I am surprised the minister did not have a statement today about the wildfire near the Shoals Provincial Park near Chapleau. Could the minister now explain how it was that a ministry-prescribed burn would get out of control, necessitating the implementation of water bombing and the use of 90 ministry firefighters to try to put out a fire that was out of control, and can he indicate what the status is now of that fire.
Hon Mr Kerrio: It is generally accepted that fire plays a very important role in the renewal of our forests. We have some 40 controlled fires a year for that very purpose. We generally burn many thousands of hectares for the renewal of new growth. The member could witness the fact, with all the kind of yawning that is going on over there, that some of the major forests in North America were allowed to burn because they felt Yellowstone National Park was getting a natural renewal.
Mr Wildman: I didn’t ask about the purpose.
Hon Mr Kerrio: The member knows the purpose. I do not know why he put the question the way he did. He is from northern Ontario and he obviously does not understand the whole issue.
Having said that, in a controlled burn, when you have some 40 a year -- we are very proud that we do not often have one get out of control as this one did -- the facts can escape us from time to time, human frailties being what they are. All the studying that was done to have this controlled burn certainly did not keep in line with the norm and the fires jumped over into an area that was very dry, a budworm-infested area that is quick to take fire.
So it is not unusual. It is of course unusual to have one break away as this one did. I am sure my forestry people in that area are very disturbed and not too happy that this took place, but it is bound to happen that if you set fires, from time to time you will have one that might get out of control.
Mr Wildman: I did not ask the minister about the purpose of prescribed burns. What I asked him was how it was that this particular prescribed burn got out of control He did not answer that, except to say something about human frailty. Could he explain what human frailty in this particular case caused the fire or helped to cause the fire to get out of control, and could he tell us what the current status is of the firefighting to try to bring this fire back under control.
Hon Mr Kerrio: Certainly, the honourable member is trying to squeeze something out of this issue that is not factually based on why we do these things. We print a very important booklet explaining to many people why and how we have prescribed burns for many uses of forest renewal. That is precisely what happened there.
When I talk about human frailties, I am saying there must have been some particular aspect --
Mr Wildman: You don’t know.
Hon Mr Kerrio: That is right. We do not know sometimes how these get out of control, but there have been 40 a year for many years going back into forestry practice, and to have the odd one get out of control I would think is not a bad record. Having said that, as the member has described, we have some water bombers and people on the site fighting the fire. It would appear that it would be described right now as out of control until such time as they have another couple of days fighting that fire.
To take it out of the context of the purpose is being somewhat irresponsible and I feel that is what the member is doing.
Mrs Marland: My question is to the Minister of the Environment. Last 9 September, the ministry staff promised the people who live in the vicinity of the Tonolli plant in Mississauga that the soil would be cleaned up from the lead contamination by spring of 1989. It is now 10 months later and that cleanup has not started. What is the minister’s answer?
Hon Mr Bradley: Some meetings have taken place between the staff of the Ministry of the Environment, the regional municipality of Peel and the city of Mississauga as to precisely how this can be carried out.
The member will recall the very successful negotiations that took place with the city of Toronto. The member for Riverdale (Mr Reville) would be particularly aware of this and of the cleanup that took place in his particular part of the city of Toronto. On that occasion, the city of Toronto shared in the cost at that time. What they did was share in the cost of the cleanout of the buildings themselves, which amounted to the inside costs. The Ministry of the Environment assumed the costs on the outside.
Of course, it is our intention to recover the costs from those we believe to be responsible. In the case of Canada Metal, we have indicated a court case. In the Niagara Street neighbourhood here in Toronto, we will be undertaking action to obtain those funds out of the company the ministry believes is responsible.
I hope to see this project move as quickly as possible. The member may be aware of this perhaps even better than I, being the member for the area; I think there have been some very recent meetings that have taken place that give some rise to optimism. Is that correct?
Mrs Marland: I am not about to give the information to the minister. He can ask his staff his own questions. If he were interested in this issue, he would have the information and in fact he would have the answers.
It simply is not good enough that 10 months after his ministry said it would clean up in the spring of 1989, nothing has been started. It is not good enough that he stands there and says there have been discussions ongoing among the region and the city and his ministry, 10 months of negotiations. In fact, there have been no communications of any value among his ministry and the region of Peel and the city of Mississauga for some time now. The most recent action has been that the region of Peel has again said it will not pay for the cleanup. My question --
The Speaker: I was just wondering if you were going to get to it. You had said you were not going to give any information. Do you have a question?
Mrs Marland: My question is based on the fact that the minister asked me a question. What does he want me to tell the people of the Tonolli plant area, whom his ministry promised 10 months ago at a public meeting with 300 people that it would be cleaned up in the spring of 1989? It is now July 4.
Hon Mr Bradley: I know the member would want to use her own good offices to perhaps suggest that there might be a cost-sharing formula, as others in this House have been supportive of a cost-sharing formula between the city of Toronto and the Ministry of the Environment of Ontario, in other words, the taxpayers of Ontario at large assuming a very significant amount of that particular cost.
I want to assure the member that it is our intention to proceed with that. There have been activities that have taken place in there in terms of studying the precise extent of the contamination to determine which properties specifically should be cleaned up and what to do with those properties which are public but do not have the access of individual people within the community.
I want to assure her that we intend to proceed with that. I hope she will be supportive of our efforts to have some of the costs assumed by those in the local area. I know she will be supportive of the fact that we will be seeking to obtain from the company, which in the estimation of many is responsible, its financial participation.
REPORT BY COMMITTEE
SELECT COMMITTEE ON EDUCATION
Mr Mahoney from the select committee on education presented the committee’s second report and moved the adoption of it recommendations.
Mr Mahoney: First of all, very briefly, on behalf of our chairman, the member for Eglinton (Ms Poole), I would like to thank all members of the select committee for their participation. The committee conducted extensive research and held public hearings in March and April 1989. I would like the members of this House to know that all members worked very hard to come up with a consensus. Along with the chairman, I would particularly like to commend the critic for the New Democratic Party, the member for Scarborough West (Mr R. F. Johnston), and the critic for the Progressive Conservative Party, the member for Burlington South (Mr Jackson), for their very nonpartisan views in working towards some recommendations.
The committee came up with three very short but concise recommendations with regard to the length of the school year and the length of the school day. I will not go through those, but suffice it to say that we found the proponents felt there was not only educational value to adjusting the length of the school year and the school day but also certain fiscal values that could be obtained.
The report will be available immediately following question period in the media centre and will be distributed to all members. Once again, I would like to thank the committee members for their co-operation.
On motion by Mr Mahoney, the debate was adjourned.
INTRODUCTION OF BILL
MINING AMENDMENT ACT, 1989
Mr Kerrio moved first reading of Bill 42, An Act to amend the Mining Act.
Motion agreed to.
Hon Mr Kerrio: Introducing the Mining Amendment Act for first reading, I want to make it perfectly clear that this is the only section of mining involvement that is in the Ministry of Natural Resources, and it is the gas wells in Lake Erie. The amendment affects only that part of the Mining Act.
Under that jurisdiction, this particular section governs the leasing of crown land under Lake Erie for the purpose of natural gas production. The terms of the leases, including the rents and royalties payable to the crown, are prescribed by regulation.
The fact of the matter is that there have been some royalties that were due and payable and there was some ambiguity in the bill as existed in the past. This is to clean up that regulation so that the one producer is going to be charged with the responsibility of making up for the past royalties that were due the province. I think it is very important that we pass this bill as quickly as we can for that purpose --
The Speaker: Thank you.
Hon Mr Kerrio: -- because there is some $.11 million outstanding that can be collected once we are able to pass this bill.
The Speaker: I thank the minister for the explanation. Perhaps it can be discussed further on second reading.
Hon Mr Conway: If I might, my colleague and friend, the member for Prince Edward-Lennox (Mr MacDonald), has a petition. We went quickly over petitions; there were not any today. He would like to present a petition. As an accommodation --
Hon Mr Conway: I am just going to ask for unanimous consent. If it is not acceptable, then the consent can be denied, but I would seek consent to revert to petitions so the member for Prince Edward-Lennox can present one.
The Speaker: Is there unanimous agreement?
Mr MacDonald: I have a petition with 1,500 names affixed to it:
“To the Honourable the Lieutenant Governor and the Legislative Assembly of Ontario:
“We, the undersigned, beg leave to petition the Parliament of Ontario as follows:
“We thank the Lennox and Addington County Board of Education for supporting a baby-sitting service for students at Ernestown Secondary School and Napanee District Secondary School for the past nine years. Due to an interpretation of Ministry of Education regulations, the board felt compelled to cancel this worthwhile service as of June 30, 1989. We beg of you to allow the board to continue the baby-sitting service for one more year or until an acceptable alternative is in place.”
I have affixed my name thereto.
The Speaker: I should just check this out. There was unanimous consent, was there, to revert to petitions for everyone? Fine.
Mr Miclash: I have a petition that reads:
“To the Honourable the Lieutenant Governor and the Legislative Assembly of Ontario:
“We, the undersigned, beg leave to petition the Parliament of Ontario as follows:
“To amend the Teachers’ Superannuation Act, 1983, in order that all teachers who retired prior to 31 May, 1982, have their pensions recalculated on the best five years rather than at the present seven or 10 years.
“This proposed amendment would make the five-year criteria applicable to all retired teachers and would eliminate the present inequitable treatment.”
Mr Laughren: I have a petition from a group called the Affordable Housing Action Group and they are petitioning us as follows:
“We, the undersigned, beg leave to petition the province of Ontario as follows:
“Given that the property speculation in Ontario has contributed to driving up the cost of home ownership, to increasing the cost of building nonprofit housing and to rent increases for tenants because speculators are rewarded under the provincial government’s rent review law, we demand that the government of Ontario impose a tax on the capital gain on nonprincipal residences and land, so that 100 percent of the profit is taxed away on resales within one year, 75 per cent of the profit is taxed away on resales within two years, 50 per cent of the profit is taxed away on resales within three years and 25 per cent of the profit is taxed away on resales within four years.”
There are literally thousands of petitions here, to which I have affixed my name only on the top one, because there are just too many to do otherwise. I would hope that as the page takes this to the table, that the table will keep it.
Mr Reycraft: I have a very lengthy petition. It is signed by 794 residents of the village of Lucan. It draws attention to problems resulting from inadequate municipal water supply and asks the Ministry of the Environment to take immediate action to approve funding of improvements to that water supply system. It is signed, as I indicated, by 794 people and I have affixed my signature.
SECURITY IN PREMISES USED BY PUBLIC
Mr Sterling: “To the Honourable Lieutenant Governor and the Legislative Assembly of Ontario;
“We, the undersigned, beg leave to petition the Parliament of Ontario as follows:
“We request that the Ministry of the Attorney General withdraw Bill 149, An Act to amend the Trespass to Property Act, which we believe is unnecessary and without mandate. While we respect the rights of minorities and youth, whom Bill 149 alleges to protect, we oppose the way in which the proposed legislation will erode the ability of owners and occupiers to provide safe and hospitable environment for their patrons and customers.
“We are further concerned about the legislation’s potential for increasing confrontation in the already difficult process of removing individuals who create disturbances on publicly used premises.”
I have signed that, along with 120 other people, primarily from the Ajax-Pickering area, who would like this bill killed.
Mr Neumann: I have a petition which reads as follows:
“To the Lieutenant Governor and the Legislative Assembly of Ontario:
“We, the undersigned, beg leave to petition the Parliament of Ontario as follows:
“Whereas it is my constitutional right to have available and to choose the health care system of my preference;
“And whereas naturopathy has had self-governing status in Ontario for more than 42 years;
“We petition the Ontario Legislature to call on the government to introduce legislation that would guarantee naturopaths the right to practise their art and science to the fullest without prejudice or harassment.”
It is signed by 156 citizens of Ontario and I add my signature to it.
ORDERS OF THE DAY
ASSESSMENT AMENDMENT ACT, 1989 / LOI DE 1989 MODIFIANT LA LOI SUR L’ÉVALUATION FONCIÈRE
Mr Grandmaître moved second reading of Bill 37, An Act to amend the Assessment Act.
Hon Mr Grandmaître: On 21 June I introduced Bill 37, An Act to amend the Assessment Act. As the members will recall, this bill has two main objectives.
First, it will reduce the business assessment rate for Ontario’s distillers from 140 per cent to 100 per cent in 1989 and to 75 per cent in subsequent years.
Second, it will ensure that Ministry of Revenue’s assessors can continue to release information to ratepayers.
The members will be aware that there are presently six business assessment rates, ranging from 25 per cent to 140 per cent. For over eight decades, since 1904, distillers have been the only class of business to be assessed at the highest rate. Brewers, however, are assessed at 75 per cent.
L’iniquité de cette situation est reconnue depuis longtemps: par exemple, en 1986, le comité permanent des affaires gouvernementales a accordé, à l’unanimité, son soutien à la possibilité d’une réduction.
My ministry has made a careful study of the effect that changing the rate will have on the 14 municipalities in which distillers have property. As well, extensive consultation has been held in each municipality and I am pleased that they recognize that the tax treatment of the distilling industry is unfair and unjust.
Le projet de loi 37 comporte également des dispositions prévoyant l’octroi de subventions spéciales visant à compenser les municipalités touchés par la perte de recettes fiscales. Ces subventions s’échelonneront sur une période de cinq ans pour les quatre municipalités accusant d’importantes pertes fiscales, et sur trois ans pour les dix autres municipalités.
The second part of the bill deals with information disclosure under the Assessment Act. It has been a long-standing practice of the assessment program to assist ratepayers in understanding their assessment by comparing their property to similar properties in the neighbourhood. There was some uncertainty whether this practice could continue since the data the assessors gave out might be regarded as confidential.
The final provision of the bill ensures that municipalities and school boards will continue to receive the assessment information which they will need for planning purposes.
Mr Morin-Strom: I am pleased to be able to participate on behalf of our caucus in the second-reading debate on Bill 37, An Act to amend the Assessment Act. I think it is rather unfortunate that the Minister of Revenue (Mr Grandmaître) and the government House leader (Mr Conway), however, were unable to organize their government’s business in such a fashion that this bill could be dealt with in a normal, proper fashion.
Certainly, it is not normal for the government to bring forward bills on the kind of urgent basis that this bill has been brought forward on and then to propose that we start the debate on the bill after giving us a copy of the bill one week earlier and then suggesting that debate on the bill occur in the absence of our critic for the bill, the member for Beaches-Woodbine (Ms Bryden) who had long-standing plans not to be here this week. The government House leader, the Minister of Mines (Mr Conway), now wants us to deal with the bill after giving us one week’s notice.
This bill, which suddenly has become an urgent priority for this government, was only introduced into the Legislature on 21 June, copies of the bill were not provided to the opposition members until last week and now we are asked to deal in detail with this bill as an urgent priority of this government. One would think the government had some priorities in the dozens of bills that it presented to this Legislature prior to this one. One has to ask why the government is not moving, for example, on Bill 208, the bill to amend the Occupational Health and Safety Act for Ontario; a bill that was introduced months earlier than this one, but this government is not acting on it.
There are many other items in Orders and Notices which the government refuses to address. We have a bill from several months ago which was supposed to be a government priority, Bill 219, An Act to amend the Highway Traffic Act; a bill which in its purpose would have provided improvements to health and safety on our highways, a bill which would have provided particularly better regulation of bicycle traffic on the highways and provided certain protections as well that would be of interest to the disabled community.
But no, this government does not have those as a priority. Instead, its priority today is to address the Assessment Act for solely one industry in Ontario, the liquor distilling industry. This government surely could have looked more seriously at problems with the Assessment Act and our whole structure of property taxes in Ontario and brought forward a comprehensive approach to property tax reform -- which should have been the priority when it comes to the Minister of Revenue and property taxes -- rather than this particular bill, which is going to turn out to be a handout to one particular industry, not a resolution of the overall injustices of our assessments in Ontario or the desperate need we all, certainly on this side of the House, feel we need to address with respect to property taxes in the province.
Our critic for the Minister of Revenue, the member for Beaches-Woodbine, has done an excellent job of preparing information on this bill and I am pleased to be able to present some of her concerns on behalf of our party with respect to this bill as it was presented less than two weeks ago.
Hon Mr Conway: We were all ready to hear Marion on Thursday.
The Deputy Speaker: Order, please.
Mr Morin-Strom: The government House leader has a question?
Hon Mr Conway: I was just saying we were all set to hear Marion on Thursday.
The Deputy Speaker: Order, please.
Mr Morin-Strom: And what happened to your agenda at that time?
The Deputy Speaker: Order, please.
Hon Mr Conway: The NDP decided to talk out the day on Bill 211.
The Deputy Speaker: Order. One member at a time, no interjections, and the member who has the floor will address his remarks exclusively through the Speaker, of course.
Mr Morin-Strom: Thank you, Mr Speaker. I appreciate the control you are going to maintain throughout the afternoon on this particular bill.
The member for Beaches-Woodbine has done an excellent job for us in the New Democratic Party since she was first elected in 1975. Certainly I would like to commend her for the work she has done on all the bills for the Ministry of Revenue, particularly for the work she has prepared on this one. This member has provided excellent service to the Legislature over the years, and to our party as well over even more years, because she had worked for a number of years, before my time of direct involvement with the NDP, back in the 1960s as the director of our research staff. Her knowledge and understanding of budget bills and revenue bills is certainly comparable to anyone in this Legislature and her work over the years has certainly been commendable.
I regret the fact that this bill was introduced so late in our session and we have not had more time for all members to be able to take a close look at it.
One of the really questionable aspects of this bill is why a government would be making action retroactive to the start of this year. One would have thought that if there had been any plan at all, they would have introduced this bill last year, if they were planning to make changes to the assessment for one particular industry for fiscal year 1989. At this point, I think it would be far more appropriate if we were discussing the assessment for the liquor industry for succeeding years and not dealing with a bill which is going to be retroactive in nature, as this one is.
This particular bill will provide a tremendous handout to the liquor distilling industry, a handout of something over $4 million over the next six years. At present, under assessment formulas, the liquor industry is assessed at a percentile of 140 per cent. This bill proposes to bring that percentile down to 100 per cent for the current calendar year, and then for next year and succeeding years down to an assessment of 75 per cent.
One has to question why this government is giving this status to one industry rather than doing a comprehensive assessment and overhaul of the assessment bases covering all industries in Ontario. This seems to be a knee-jerk reaction in response to some type of lobbying effort or initiative the liquor industry may have undertaken with the provincial government.
This initiative is going to cost the province an estimated $4,282,948 over the next six years. The province is proposing to compensate municipalities for the reductions in the liquor industry’s assessment base, and to pay essentially a payment in lieu of property taxes to the municipalities that will have their property tax base reduced by this act.
One can look back at the history of studies on the Assessment Act and the property tax structure in Ontario and really recognize that there are severe problems with the way property taxes are structured when it comes to business properties in the province.
The taxation of business properties was the subject of a special study by the Ontario Committee on Taxation back in the 1960s. This committee, which reported in 1967, concluded then that “the cardinal weakness of the Ontario business tax is the indefensible structure of its rate assessments.” It also said “nothing has emerged that lends support to a graded rate structure.”
This committee therefore recommended that there be a flat business occupancy tax on taxable assessment at a level rate for all businesses in Ontario. However, this recommendation has never been recognized, accepted or implemented by the government of Ontario. One of the disadvantages is that there would be as many winners and losers with no real rationale for the burden of tax on each class of business.
One would question why this government has not come forward for an open consultation with respect to rate classification that would cover all business interests in Ontario and take an honest, hard, cold look at the rate of property taxes on the business community and at why some businesses are paying tax rates of as high as 140 percent and then other businesses are paying taxes much under 100 per cent; in fact, well under 50 per cent. I think some are as low as 10 per cent.
The kinds of distortions this generates surely are a subject of interest not just to the liquor industry but to all industries in the province. One would have thought the province would have come forward with some potential recommendations for a major overhaul of the assessment system and some rationale for putting some fairness into that assessment.
Beyond the formulas for the assessment, one has to look at the whole reliance this government is placing on property taxes. This government clearly has said that one of its priorities in terms of funding services of all types in Ontario is to pass the buck to local municipalities. This government has cut back on transfer payments to local municipalities. It has cut back on the amounts it has paid for road improvement in municipalities and, in particular, unconditional grants. By not even providing inflationary increases that would allow municipalities to keep up with their increasing costs of programs, this government is forcing municipalities to rely more and more heavily on their local property tax base, with the result that local municipalities are severely disadvantaged in their ability to maintain the roads and infrastructure and local services to their communities.
The same applies, of course, to our school boards. While this government, the Liberal Party in particular, advocates that education is a priority in this province, stated as one of the six priorities in the last throne speech, the distribution of funds from this government to provide for education indicates clearly that this priority is one in words alone and is not backed up by dollars to school boards.
School boards in this province have been starved for a number of years, certainly since this government took office in 1985. It has not lived up to its commitment to move to 60 per cent funding of schools in Ontario. We know that back in the 1970s the costs of elementary schools and high schools in the province were funded approximately 60 per cent by transfer payments from the provincial government to local school boards. Approximately 40 per cent of the burden was placed on local property taxpayers.
However, in recent years the 60 per cent funding that the province historically provided has dropped drastically. When the Liberals took office in Ontario in 1985, that percentage had dropped to approximately 48 per cent, with local property taxes having to pick up the balance of 52 per cent of the costs of education in Ontario.
The Liberals campaigned in 1985 and again in 1987 on the fact that they were going to return the funding to our school boards to a level of 60 per cent of the cost of education in the province. But what have they in fact done? The support has gone down continuously since the Liberals took office. Today, the province is funding something in the order of only 42 or 43 per cent of the cost of education of our children in our elementary and high schools. That continues to go down.
The funding from Ontario continues to go down at the same time this government proclaims that education is one of its priorities and continues to ask school boards to provide more and better services, new programs and more classes, without the funds to be able to do so. As a result, we all know the pressures that school boards in our local communities are facing with respect to the cost of education.
In most communities now, individuals are paying as much in their property taxes to local school boards as they are paying to their local municipalities. These school boards are up in arms at a property tax system they do not have control over. They are being forced to ask ratepayers to pay increases well over the inflation rate just to stay equal and to provide the same level of services, much less the kind of improvements to services we all would like to see in Ontario.
I would ask why the Minister of Revenue has not come forward with a green paper suggesting government proposals with respect to a massive overhaul of our system of property taxes in Ontario. Surely alternatives exist that would be fairer to all the taxpayers of our province. The property tax has to be one of the most unfair sources of taxation one could imagine. Property taxes and the value of one’s home or business are not related to the income levels of the individual or the earning capacity of that business. Surely our tax system should be based on ability to pay, and those who are earning good incomes should be the ones paying, while those living near the poverty level should not have to be paying exorbitant levels of property taxes as is the case in Ontario today.
One of the alternatives the minister could have looked at is whether he would perhaps have given local municipalities and school boards the right to a more progressive type of taxation than property taxes. If the government is not willing to provide adequate funding to local municipalities and school boards, perhaps it could provide them with a fair source of tax revenues. One would be to look at the possibilities of local income taxes or local sales taxes. Surely a tax system that would allow municipalities to replace property taxes with much the fairer income tax would be one welcomed by many people in the province.
When it comes to assessment, another issue the minister has neglected over recent years has been the overall issue of market value assessment. Why has the minister not come forward with a market value assessment overhaul, assessment which would make sense rather than the current nonsense that is involved with market value assessment in Ontario?
We have had market value assessment imposed on communities across this province, creating tremendous injustices in those communities, where taxpayers at lower income levels who may have larger pieces of property, particularly in rural areas, have been stuck with an incredible tax burden to the point where they have had to divest their family property, hand it over to the development industry and break up property that has been in families for many years. I do not know how this province can justify the market value assessment that has been imposed on communities across this province.
I know the uproar it created in Sault Ste Marie and the injustices that occurred because of the nonsense involved in the provincial regulations and legislation on market value assessment. I know that the former member for Sault Ste Marie, the former Minister of Labour, paid a very heavy price for the imposition by the former government of market value assessment in Sault Ste Marie. There have been similar reactions in other communities across this province.
Meanwhile, we have a community like Toronto, where the government refuses to do anything about market value assessment. The government continues to ignore the fact that market value assessment was forced on communities across the province, but will not deal with the largest city in the province, the city of Toronto, and the problem that no type of market value assessment has been imposed on Toronto. Surely this government could have come forward with a revised proposal on market value assessment, one that perhaps would make sense rather than its current formulas, and then go ahead to see that we do have fair assessments for cities across this province.
Perhaps the city of Toronto should be the example that this province should have come forward with a proposal on. Then if one were able to get a system that made sense for Metropolitan Toronto, we could go back and redo and correct all the mistakes the government has made in other communities across the province when it comes to market value assessment.
Really, this bill addresses such a limited scope of the subject of assessment in Ontario that one has to question how on earth this government could be serious in saying this is a priority. Here we are on 4 July. Presuming we get the new House rules passed, next year we will not be here on 4 July because we will have some rationale to the kind of scheduling we have in this Legislative Assembly, but we have a government that has priorities placed on a bill which --
Hon Mr Conway: Does this mean that “withdraw or die” is a thing of the past?
The Deputy Speaker: Order, please. Could the private conversations please stop and could you let the member for Sault Ste Marie proceed?
Mr Pouliot: The government House leader is out of control.
The Deputy Speaker: Order. There are a lot of members out of control. The member for Sault Ste Marie is the sole one to have the floor.
Mr Morin-Strom: I am just making the point that the government House leader, the Minister of Mines, who obviously has a high-priority position in this government has been unable to come up with any kind of government schedule or list of government priorities that makes any sense to anyone in Ontario.
To suggest that his priority at this time is to correct what he or the Minister of Revenue views as an injustice to the liquor industry in Ontario, as a priority of this government, is really beyond explanation for this government.
Mr Morin-Strom: We may have to continue this debate at length because I think our member for Windsor-Riverside (Mr D. S. Cooke) does not agree with all the points I am making here.
As I say, our critic the esteemed member for Beaches-Woodbine had established a clear position on this bill, but the government only presented a copy of the bill to us one week ago, so we have not had the opportunity to have the kind of full, open discussion we would normally have in our caucus on this kind of bill. I think we are going to have to look at some length at some of these ramifications, in the absence of the member for Beaches-Woodbine, in order to determine what in fact is the intent of this bill, what is behind it from this government and whether we can support the bill at all.
As I look through some of the notes that have been provided by the member for Beaches-Woodbine, our critic for the Minister of Revenue, she has a number of reasons for our rationale, certainly her views as to why the New Democratic Party should take a position in opposition to this bill. The Minister of Revenue calls us turncoats. I do not know whether she had ever given him the indication that we were planning to support the bill. To my understanding he did not even tell her about the bill until less than two weeks ago, so it is hard to say how he could have gotten the impression that we were planning to support the bill last week.
In any case, there are several reasons we do have concerns and on second reading would have to vote in opposition to the bill, at least at this point. At this point, all studies that have been done with respect to the Assessment Act have not been able to find any rationale for the current graded rate schedule for business assessment in Ontario. As a result, one cannot solve the problem of a graduated assessment schedule which treats different industries vastly differently in terms of their property tax load for individual municipalities. Certainly, this bill does not do anything to solve that problem.
Moving the assessment base for one industry from 140 per cent down to 75 per cent as proposed for the liquor industry in Ontario may move the liquor industry into line with the brewing industry, which I understand is the Minister of Revenue’s main criterion here, but what does it do about all the other industries in Ontario?
This bill does not address the reasons and the rationale for having a graduated system, whether we should have one at all, and if we have one, what the rationale would be for ensuring that it is a fair one.
So we cannot support the bill on the basis of solving the minister’s problem with respect to his relationship with the liquor industry as the sole objective of this particular bill.
This bill is discriminatory and inappropriate in its attempt to amend the rate for one class of business without considering the rate for all other classes of business in Ontario.
I feel it would be far fairer if the current schedule could be frozen until a new graduated schedule is established, based on some sort of yardstick of ability to pay, and to ensure that was phased in over a period of years.
Mr Faubert: You want business to have the ability to pay? What kind of logic is that?
Mr Morin-Strom: Is that the parliamentary assistant to the minister questioning how ability to pay would have any logic in a taxation system? That is the Liberal attitude towards taxes in Ontario. If it is related to ability to pay, that is outside of any logical sense that the Liberal government of Ontario could possibly have.
Mr Faubert: I am talking business.
Mr D. S. Cooke: What kind of sense does that make, Frank?
The Deputy Speaker: Order, please.
Mr Morin-Strom: I see. His clarification is that it is for businesses that ability to pay is an inappropriate basis for taxation.
Mr Fleet: No, he said for business taxes.
Mr Faubert: He doesn’t know the difference.
The Deputy Speaker: Order, please. Any time members want to stop, I will be very pleased to remind all members that there is a period for questions and comments afterwards in which each member can take two minutes to say whatever he or she wants. Are we ready to proceed?
Mr Morin-Strom: I guess I just have to make some remarks with respect to the point that the member for Scarborough-Ellesmere (Mr Faubert) has made. He has said that ability to pay has no place in a system of business taxation in Ontario. What kind of nonsense is that from the parliamentary assistant to the Minister of Revenue?
Surely ability to pay should be the prime criterion for any system of taxation, whether it is for individuals or, certainly, for businesses in Ontario as well. We know that this is one of the fundamental flaws with our whole property tax system. This government and its representatives, dealing with the issues of revenue, do not recognize the kinds of injustice they are going to place on individuals and businesses when they do not adhere to the number one principle of taxation: that it should be based on the ability to pay.
This bill is perfectly illustrative of this government’s lack of recognition of that principle. It is not a bill based on ability to pay. It is not based on the financial success of the liquor distilling industry. It is based on an arbitrary decision that the levels of taxation for this industry should be reduced by some $4 million over the next six years and that the province should effectively subsidize that industry by paying grants in lieu for property taxes to the municipalities in which that industry is located.
This bill does not relate this particular industry to all industries in Ontario. It does not have a rationale for assessment practices, one that would be based on any type of fairness or ability to pay, which certainly our party would take as the hallmark of any type of taxation system that we would like to see acted upon in Ontario. This bill will be passing to the distillers an indirect benefit from the Ontario Treasury to the tune of some $4,282,948 over six years.
It is unclear what will happen in these municipalities after the six years with respect to their assessment bases and how they will be compensated in future years from the liquor industry or from Ontario.
Mr D. S. Cooke: Increase property taxes.
Mr Morin-Strom: As the member for Windsor-Riverside points out, I think the only conclusion has to be that it is going to be the property taxpayers who are going to foot the bill after the six years are over and it is going to be those individuals living in those communities who are going to pay because the major industry in their community is paying less in the support of their local municipality.
If one were to take an assessment of fairness, one must remember that the distilling industry is not currently paying any of the social costs arising from alcohol abuse, including health and hospital costs, the slaughter on our highways, family breakdowns, child and wife abuse and lost productivity. One would think that, if anything, if one were to have a system that was going to be based on fairness, one would not see the rates for the liquor industry being brought down, one would perhaps see the rates for the brewing industry being brought up.
The minister has not explained why it is that he is proposing that the distillers be brought down from an assessment rate of 140 per cent to a rate of 75 per cent and why, rather, he has not proposed that the brewers be brought up from 75 per cent to 140 per cent.
Perhaps the minister can explain what his rationale is with respect to the whole issue of industries whose sole purpose is the distribution of alcohol and spirits, which we know have a tremendous burden in terms of social and health costs for the province, and why we would have a government subsidizing a component of that industry, rather than having those industries a fair share of the burden of our taxes in paying the province and under some rationale be put into a base that would provide some greater fairness among all industries and certainly among the various components of the liquor and brewing industries.
The property tax bases for both cities and school boards are going to be severely hurt by this particular bill. I do not see any way that we can justify that type of harm to the municipalities and the property taxpayers in those communities, who are going to have to pay the price for this government’s desire to provide a new handout to one particular favoured industry.
As a result, on this major point of Bill 37, I feel that we cannot support this bill at second reading. This particular initiative in it cannot be supported at this time.
I would make just a brief comment with respect to the additional amendments in the bill. The bill also contains some administrative amendments to section 57 of the Assessment Act which clarify what assessment information can be released by assessors and explicitly forbid the release of this information to any person other than the person or corporation to whom it pertains. Assessors are still allowed to release information, however, on comparable residential properties. Release of information on commercial and industrial properties is further restricted if its release might prejudice the financial or competitive position of investment property owners.
Again, it would appear that this government is providing favourable exemptions for the business community in comparison with the access to information that will be available with respect to private homes in Ontario.
Under this section, municipalities and school boards will continue to receive assessment information needed for administrative purposes. However, the bill brings employees of school boards under the same penalties for unauthorized disclosure of assessment information as currently apply to assessors and municipal employees.
My inclination has always been towards freedom of information. In very rare cases, the release of information does harm to society. I have concerns when we have a government that is moving to suppress information, because I do not believe, in terms of dissemination of knowledge and ensuring that everyone is working with access to the same information, that one should be involved in the practice of restricting the release of information.
As a result, I would also have some concerns about some of the restrictions to information with respect to property values that are contained in the Assessment Act. I believe that this kind of information should be made more open to the general public, not less open.
One of the most serious problems with our property tax system is the fact that it does not address fairness of property tax values from one related or nearby property to another. The inability that individuals and business have to get tax unfairness addressed will not be solved by the proposals in this bill. This bill will continue a system which has restrictions on information and which makes it more difficult for property taxpayers to ensure that while they know they are paying a tax which is inherently unfair, at least it should be based on some type of fairness with respect to their neighbours and others who are competing with them in business, for example, or are in homes of comparable value.
This government has a long way to go to address the whole system of our property taxes and to create an assessment base that would provide some kind of fairness for property taxpayers, whether individual or business, across Ontario.
I think I have explained and described some of the concerns we have with respect to this bill. I regret the fact that the government House leader felt he had to call this bill his number one priority today, despite the fact that we have budget bills from the Treasurer (Mr R. F. Nixon) which presumably have some priority in this government, despite the fact that we have a bill like Bill 208 which would make a major move towards improving health and safety in Ontario and despite the fact that we have other bills dealing with serious concerns in areas such as education and the environment in Ontario.
I wish the member for Beaches-Woodbine would have been able to be here to make our opening remarks with respect to Bill 37, but I am sure she will be back in time to make our closing remarks.
Mr Runciman: Our critic also is unable to be here today, so a number of colleagues are going to offer input into this important piece of legislation. I want to indicate at the outset that unless we determine in the next little while that Patti Starr is somehow connected to a distillery, we intend to support this legislation. But given the revelations that have been pouring forth in the past couple of weeks with respect to Ms Starr’s multitude of connections with this government and individual members and ministers, who knows what might come up in the next day or so? We just never know.
The member speaking before me was critical of the schedule of business established by the government House leader and I guess it is perplexing indeed, but when we look back at the history of that particular gentleman and his current responsibilities, it pretty well fits into the pattern. We have had some difficult times indeed. Again, I think we are going through some difficulties with respect to the relationship between various parties in this House, in trying to seek some resolution of the misunderstanding so that we can get back to our ridings, meet with our constituents and do the business that has become backlogged for all of us, at least for most of us, in our own constituencies.
Hopefully, some degree of common sense will soon come upon the government House leader. Whether he will receive direction from the corner office or what, we do not know, but certainly we are continually optimistic that something will be forthcoming to improve the atmosphere and the environment around this place in terms of the relationship between the three parties.
I had the opportunity to serve on a task force back in --
Mr Laughren: On a point of order, Mr Speaker: I have not counted, but I have a sense there is no quorum in the chamber. Ninety-four members and they cannot get a quorum.
The Acting Speaker (Mr M. C. Ray) ordered the bells rung.
Mr Runciman: Before the need to call additional government members into the chamber, I was speaking briefly about the government House leader, the agenda of business and so on. We have read recently about the fact that because of the various crises the government has been facing over the past period of time, the Treasurer has now put his retirement plans on hold, which I am sure is causing no end of grief to the Chairman of the Management Board of Cabinet (Mr Elston), who had already tried sitting in the chair, had it all sized up for himself and was prepared to move in there at some point later this year. Now we read that because of the situation currently facing the government, the Treasurer has decided to hang in, tough it out and do the right thing on behalf of the party.
We can appreciate that. Since that vacancy at Ontario Hydro remains, someone might want to consider making a suggestion to the government House leader that perhaps he should fill that particular role, that vacancy. I do not know whether we would be better off or not, but in any event certainly the operations within this assembly, this House, would see a marked improvement. I will put that one forward as a suggestion, and hopefully some of my government friends will whisper in the right ears. Apparently, the right ears have to be those of Heather Peterson, who occupies a section of the corner office.
Mr D. S. Cooke: Who pays the rent?
Mr Runciman: Yes. That is a good question. Who is paying the rent on that space in this government edifice so that an employee of the Ontario Liberal Party, sister-in-law of the Premier (Mr Peterson), can sit in that little corner office and make numerous patronage appointments across this province?
Liberal after Liberal has been appointed to police commissions. Every little government vacancy -- agency, board and commission -- has been filled over the past couple of years by the Liberal faithful. It is not only a question of filling these vacancies with Liberals or people who profess to be Liberals -- sudden Liberals, instant Liberals -- it is also the fact that they have increased the per diems these individuals are paid by something in the order of 400 per cent to 500 per cent.
The Acting Speaker: Order. I assume the member is going to relate these comments to the item before the House, which is An Act to amend the Assessment Act.
Mr Runciman: Well, these all relate indirectly, I agree, to tax revenues. All of these individuals have to be paid by the taxpayers. We are talking about all of these appointees. Who is responsible for collecting those revenues to pay all of those Liberal appointees those inflated per diems? It is the Minister of Revenue and it is his bill that is before us today, dealing, I agree, with a specific element of taxation, but certainly we are talking about where our tax dollars ultimately end up.
Certainly, that is an area where we have seen significant abuse. We can look at all the appointments that are not under severe criticism at this point. We should just look at the handful of appointees and the questions in regard to ethics and morality in this government, with respect to how it has gone about making a whole host of appointments to agencies, boards and commissions across this province and the favours that have been dished out on a variety of things occurring with respect to Ms Starr and others who have been named in this House.
I do not want to go on at any further length with respect to that.
Mr Speaker, following your request, I want to deal with some specifics of this legislation. We do have some concerns about the retroactivity provisions, but upon reflection, we have decided not to table amendments to the legislation in committee of the whole, because as the minister rightly pointed out earlier today, this legislation is overdue. Indeed, the distilleries have not been operating on a level playing field with respect to taxation vis-à-vis brewers in this province.
As I was saying earlier, I had the opportunity to chair a task force that toured the province in 1985 taking a look at the then Liberal Party proposal to install beer and wine operations in corner grocery stores right across the province. We had a number of distillers appear before our task force outlining the problems they have faced over a multitude of years with respect to taxation, the problem the taxation burden was creating for them but also the level playing field aspect as well.
In fact, if the government had moved ahead with its plan to allow corner grocery stores to sell beer and wine, they felt they should also have the opportunity to share that kind of shelf space. In effect, we would have corner grocery store or larger grocery operations offering not only beer and wine, but hard liquor products as well.
Of course, as we know, the government backed away from that promise. It is just one of its many promises that it has failed to fulfil. We are not being critical of that because we appreciate the ramifications that were involved with respect to that promise, that off-the-cuff promise, one of many made by the Premier. That one was made in 1985, but we can talk about a lot of off-the-cuff promises made by this Premier.
Perhaps the most infamous one now is his off-the-cuff promise that he had a specific plan to lower automobile insurance rates, and of course we know now that was a sham. He had no such plan. Indeed, consumers across this province have faced rather significant hikes in auto insurance since that promise was made.
The beer and wine in grocery stores was another one that was quickly forgotten about and disappeared down the great Liberal toilet of promises.
I want to talk about the distilling business, though. Indeed, they have been facing a number of problems in terms of their ability to compete. Living in a border area -- I am sure some of the Ottawa members here certainly, and those from Windsor, I am sure, areas that have easy access to the United States and alcohol products in the United States -- we know the significant price differential by going across into, for example, New York state -- Mr Speaker, I am sure, representing a Windsor riding, you are quite familiar with this -- going into a United States market and purchasing alcohol products. They are unbelievably lower in terms of price than their equivalent on the Ontario side of the border.
We can talk about whether the distillers are contributing to the social costs associated with the consumption of alcohol. I think they are. If you look at the levels of taxation on alcohol products in this province vis-à-vis ether jurisdictions, specifically the United States, I do not think there is any question that, certainly in the distilling industry, they are paying a good dollar to the government.
It is a significant revenue source to this government. I guess we can argue all day whether it is an appropriate level and whether it is indeed adequate to the social costs the taxpayers of this province incur as a result of alcohol abuse. I do not know, but I know that if we want to maintain a distilling industry in this province, we have to do what is necessary to ensure that it can indeed remain competitive For the most part, that has not been occurring in the past number of years and it has had an impact on the industry. They are not in the best of times right now and they employ significant numbers in this province.
I think the initiative undertaken by the minister and the government at this point is appropriate. As I have said, we do have some concerns about the retroactivity, but given the concerns on the other side of the ledger with respect to the fact that distillers have not had a level playing field for a great many years with respect to taxation policy and the fact that they have been facing some increasing problems on the economic front in terms of their ability to compete, especially in the North American market, we are going to hold back on our concerns with respect to retroactivity and its impact on municipalities and school boards across the province.
I want to talk about the competitive position as well of retailers of distilled products in this province, essentially the tourism industry. Again, the tourism industry is a major component of the economy in my riding, coming from the Thousand Islands area, the Rideau lakes area. Certainly we know that trying to compete effectively on the Ontario side with restaurants, bars, pubs, resorts and what have you on the American side -- especially, for example, the in Alexandria Bay area, just on the other side of the Thousand Islands Bridge -- with the costs of liquor products, it is simply not a viable situation.
Tourism operators are complaining consistently to me about the government’s taxation policies with respect to those products and the fact that they have to charge four or five times the price their competitor on the United States side is charging for the same alcohol beverage.
It is putting them in an extremely difficult position. As I said, not only the distilling industry but obviously the tourism industry is a significant factor in the economy of this province, a growing factor in the economy of this province. I think that according to some projections, early on in 2010 or 2011, tourism could be the number one industry in this province.
We have to, as legislators, and certainly the government has to carefully look at the situation, how they apply tax policy to these various industries and how they ripple in terms of their impact on other segments of the economy. Tourism, in my view, has certainly been negatively impacted upon by the taxation policies of the government and governments past with respect to alcohol beverages in this province.
Hopefully, the minister will not be content with this measure and will be looking at other elements of the various industries that are impacted by taxation on distilled products and other alcohol beverage products to ensure that we can remain competitive with our American friends.
We see an example in Toronto today this week with the Shriners’ convention. There are about 85,000 visitors, I gather, conning into Toronto, many of them Americans. I think they are in for a significant shock when they get out and try to buy a beer in a downtown Toronto pub and pay four or five bucks for a bottle of beer, compared to what they pay in Texas or Connecticut or Bangor, Maine, or wherever they may be coming from. Indeed, I know from reading the various articles in the past number of years, with respect to Metropolitan Toronto especially and the impressions of tourists visiting this area, that the costs of beverage alcohol and food are areas of concern to tourists coming into this area.
Just reiterating the point made earlier, we have to be very concerned about that whole area and the long-term impact on the economy of this province. Of course, the distilling industry -- this could apply to the beer industry and other industries attempting to compete with their United States counterparts -- has to face additional costs of operation in this province that its competitors south of the border in many instances do not have to face. We found this recently with American beer being very vigorously promoted through Liquor Control Board of Ontario outlets.
Mr Faubert: Dumped.
Mr Runciman: I do not know if it was dumping. Some certainly felt it was dumping. We are looking at a six-pack costing $2.50 less than what you pay for a six-pack of Canadian beer through a Brewers’ Retail Store outlet.
If you take a look at the situation and the costs associated with that, the fact is that Ontario brewers -- this applies to distillers as well, to try to tie this in with the bill we are discussing today -- are faced with increasing costs, not only the taxation burden but other costs associated with health and safety legislation and the new initiative by this government with respect to payroll tax. We have initiatives forthcoming that I am sure will impact on a number of these industries with respect to pension reform and limited indexation of private pensions.
Again, these are government-imposed costs that companies wishing to operate in this environment have to assume. Indeed, it has an impact on their ability to compete. As I say, we have to throw all of these things into the mix. If we want this kind of an industry to not only survive but prosper within Ontario, we have to do what is necessary in terms of taxation regimes and a whole host of other policies that have a very negative impact on its competitive position.
I noticed that the Minister of Industry, Trade and Technology (Mr Kwinter) during question period today was suggesting that he was the champion of business in this province. Well, I do not know. I recall Mr Bulloch, the president of the Canadian Federation of Independent Business, saying after the last budget that the current Ontario government is the most antibusiness government that he has had to deal with in his 20 years with the CFIB.
That was not a surprise to me, given the name players in this government, the fellows who really exercise the influence. I have mentioned this before, but I have no reluctance to mention it again. For example, the Attorney General (Mr Scott) was a former fund-raiser for the New Democratic Party.
Hon Mr Elston: Did the NDP raise money?
Mr Runciman: The Chairman of Management Board raises his head. I will repeat it. I am talking about the influence that some key players in the front benches of this government have on government policy in respect to business and industry in this province, and where these people are coming from in respect to their philosophy in dealing with the private sector. I specifically always like to point out the Attorney General’s background as a fund-raiser for the New Democratic Party in this province.
I think that gives members an indication. In fact, I think he said in some interview back in the early 1980s that he became a Liberal simply because the Liberals had a much greater opportunity to achieve power in this province. We have seen others enter the Liberal Party who are of the socialist mode. There is a lot of talk about their former federal leader Mr Trudeau and his connections in the past in respect to his loyalty to the socialist cause. There are certainly a great many over there who would feel quite comfortable within the ranks of my friends to the right. Indeed, that is having a significant impact on the policies that this government comes forward with in respect to the operations of business and industry in this province.
That is why I am personally pleased when we see this kind of initiative forthcoming, because they are few and far between indeed. I do not know the background of the Minister of Revenue, but I suspect that he does have a business background and perhaps that is one of the reasons why we are seeing this kind of legislation come forward.
Of course, I have to mention that my colleague the member for Carleton (Mr Sterling) was very much a factor in terms of urging the Minister of Revenue’s predecessor, the member for Brant-Haldimand (Mr R. F. Nixon), to bring in this legislation back in 1986. That died with the election of 1987 and we are pleased to see his successor move ahead with the initiative now. But I want to put on the record my personal compliments for the efforts undertaken by my colleague the member for Carleton, who was certainly very aggressive in his efforts to have the government undertake this kind of initiative.
Hon Mr Elston: It’s all smoke and mirrors.
Mr Runciman: I was really looking forward to some interjections from the Chairman of Management Board. As I have said on past occasions, for whatever reasons, he cannot figure it out himself, but whenever I am speaking in the House he tends to appear mysteriously and --
Hon Mr Elston: Nobody else will volunteer.
Mr Neumann: He just waits outside for you to speak.
Mr Runciman: We hear the member for Brantford (Mr Neumann) with one of his very infrequent interjections. We talk about people who are committed to the socialist cause --
Mr D. S. Cooke: He happens to be a waffle member.
Mr Runciman: Yes, I am reminded that this gentleman was a member of the most extreme element of the NDP, the waffle group, and here he is. Apparently he has not been buddying up with the Attorney General. He is still off in the corner way back there and we occasionally hear these weak and not very helpful interjections from that member.
This must be a sad time for him. He was a very well known individual in his own community back before the 1987 election, and to come here and be relegated to the last seat, actually, in the Legislature -- at least it used to be back in the days when we formed the government, back in the good old days. The member is back there occasionally making these not-very-helpful suggestions and interjections, and it is just too bad that he would not try to participate in a very meaningful way in this debate. We would look forward to his interjections in a meaningful and helpful way. I am sure the minister would as well.
Hon Mr Elston: Would you like an assessment of your contribution?
Mr Runciman: What was that?
The Acting Speaker: Perhaps this is an opportune time, as the formality of the institution degenerates, to suggest once again that we are involved in a public proceeding and not a series of private conversations. It would be helpful if members cared to listen to the principal speaker. I notice a number of private conversations which are not helpful in having the public in the gallery understand what we are about here.
Mr Runciman: Thank you, Mr Speaker. I always appreciate your advice.
Mr D. W. Smith: Pity you do not take it.
Mr Runciman: I do, quite sincerely. I really think I have probably said all I should say at this point. I hope the minister has taken it to heart. I reiterate that we are going to support this legislation. We share his view that it is overdue.
Although we share the concerns about the agenda that has been set by the House leader of this government, at the same point we are prepared to deal with this and deal with it as soon as possible. There are a number of other colleagues of my party who also wish to participate in this debate later on today. The member for Markham (Mr Cousens) and I believe the member for Carleton wish to have an opportunity to have some input.
Mr Laughren: I am pleased to take part in this debate. As my colleague the member for Sault Ste Marie (Mr Morin-Strom) indicated, I wish our Revenue critic, the member for Beaches-Woodbine, could have been here today because she knows a great deal about tax policy, having spent some years with the Canadian Tax Foundation, a number of years learning about taxation policy and then a number years with our caucus learning different versions and views on tax policy.
Hon Mrs Caplan: Very different versions.
Mr Laughren: Yes, different indeed.
So that everyone understands what this bill is, so that more people will understand exactly what it is, I thought I would give some quotes from the explanatory notes in the bill.
“This bill provides for a reduction in the business assessment of land used by distillers.” That is the basic principle of the bill. “For the 1989 taxation year, the business assessment is reduced from 140 per cent to 100 per cent of the assessed value of the land. For the 1990 and subsequent taxation years, the business assessment is further reduced to 75 per cent of the assessed value. The bill provides for compensating grants to the affected municipalities” for the next three years.
One part of the bill reduces it to 100 percent in the first year, then to 66 2/3 per cent in the second year and to 33 1/3 per cent in the third year. Then the province will make up to the municipalities the loss in revenue for the years 1989, 1990 and 1991. After that, it is really up to the province to determine whether or not compensating grants will be given to those municipalities.
I want to tell members, given the record of this government in passing costs on to the local property taxpayer, the hopes of those municipalities getting any break from this government in terms of relief after 1991 are slim indeed because it is simply up to the discretion of the Treasurer.
The other aspect that is not mentioned in the bill it the impact on school board assessments. I suspect the Minister of Revenue will say, “When the assessments drop, the school boards get an increase in general legislative grants to make up for the drop in assessment.” That of course has nothing to do with the ceilings under which the school boards must operate. So we can be absolutely sure that the school boards are going to get it in the neck as a result of this bill, just as the municipalities are going to get it in the neck.
We know a number of things about the amount of revenue that is involved here. We know that over the four-year period the cost to the province is going to be about $4 million -- sorry, that is over the first three years -- when the legislated proportion is down to 100 per cent, 66 2/3 and 33 1/3, and then in the following three years there will be discretionary payments by the province. The total cost to the province is going to be about $4.2 million.
On the other hand, the cost to the municipalities is going to be about $3.8 million annually. So the cost to the municipalities in one year is basically what it is going to cost the province over the full six years of supplementing assessments to the municipalities. So there is absolutely no question that this is really going to stick it to the municipalities,
We know why the minister has said he is doing it. He says: “It is not rational. Here we have the distillers paying at a rate of 140 per cent of assessed value, while others are not paying that amount. That does not make sense.” Is the minister wiping out all the different rates? No, he is just taking this one rate and reducing it. It must be nice for a member of that industry to have his industry selected, plucked out because he pays the highest rate of 140 per cent and have it lowered. There is no rationalization of the entire assessment program.
As I understand the present schedule for business assessment, the distillers pay the highest rate at 140 per cent; wholesale and warehousing, 75 per cent; financial, 75 per cent; brewers, 75 per cent; manufacturing, 60 per cent; retail stores, 50 per cent; professional practices, 50 per cent, and car parks, 25 per cent.
I asked the Minister of Revenue -- and when he winds up for the government at some point, perhaps be can tell us--how he justifies the sliding scale that is still going to be left in place. What kind of nonsense is it? If, as my colleague the member for Sault Ste Marie said, it was based on some kind of industrial ability to pay, then perhaps there would be some rationale to the whole system, but there is absolutely none.
All that has happened is that the minister has been mugged by a very successful lobby. It is truly remarkable to see one lobby after another getting its way with this Liberal government. They are a lobbyist’s dream over there. The latest to succumb to the entreaties of the lobby is the Minister of Revenue and in this case it is the distillers’ industry.
I know the minister will say, “It is a very tough time in the distilling industry.” It is not that tough. Who makes up the distilling industry in this province? Is it the little shop in the backyard? It had better not be or it will soon be put out of business. These are huge, multinational conglomerates that have had record profits that we are dealing with. We are not talking about a penurious industry here, we are talking about an extremely successful, huge multinational industry. They do not need the government’s largesse, but of course they will take it. I will bet they never dreamed that the Liberals would be such an easy group to lobby. I will bet that they are going away scratching their heads and saying: “You know, we should have gone for more. Why didn’t we go for the whole hog?”
I do not understand how this government can be so susceptible to lobbies. Let me read some of the headlines in the business press recently about distilling industries.
“Spirits High at New Hiram Walker”; this is over the takeover battle with Hiram Walker, Gooderham and Worts, when Allied-Lyons of Great Britain wrested control of Hiram Walker away from Gulf Canada.
Of course, the profits in this industry are truly remarkable. This is from the Financial Post: “The wines and spirits division became Allied’s biggest profit contributor last year, generating $503 million. About 50 to 60 per cent of that came from the North American operations. Liquor profits are up 8.8 per cent to $247.7 million in the first six months of the fiscal year.” That was 1988.
“Corby Sells McGuinness Property to Toronto Developer for $26.5 Million.”
“In its finale to its restructuring plan, Corby Industries Ltd of Montreal has sold its McGuinness Distillers property to a Toronto developer for $26.5 million.” And these people need the government’s help. That is what they tell them.
“Corby Profit on a Bender Despite Drop in Drinking.”
“Despite a four per cent drop in sales volume, the Montreal-based spirits producer boasted a 24 per cent increase in profit for the nine months ending November 30 because of better management and the benefits of having bought McGuinness Distillers Ltd last December. Corby reported nine-month profits of $12.2 million, compared with $9.8 million for the corresponding period a year earlier.
“As for Seagram’s, analysts say it is doing well. Late last year, it announced plans to drop 25 nonpremium liquor brands it markets to the United States, close its Dundalk, Maryland, plant and eliminate about 240 jobs. It is divesting the brands so it can concentrate on production of marketing resources on its more profitable brands.
“Liquor Consumption Down but Profits Grow for Corby.”
“Dupont Nonliquor Concoction Brings Record Seagram Profit.”
“The Montreal-based distiller reported profit of $589.5 million for the year ended January 31, 1989, compared with $521.8 million a year earlier.”
These are the people this government thinks needs its help, or at least it was convinced by the industry that they needed its help. It truly is amazing; when I think of all the groups and individuals out there in Ontario who could use some assistance from this government, to think that these people were moved to the top of the list is truly mind-boggling.
It is not as though this was discussed for a long period of time and it has been on the books. It was only about two weeks ago or perhaps even a week ago that the government House leader indicated that this suddenly had become a priority, a top priority of the government. Here we are with all sorts of legislation before us and we are in July. It is tradition that the Legislature adjourns the end of June and we get back out to our constituencies, but what happens?
Hon Mr Elston: We have work to do.
Mr Laughren: I do not mind. We are here and we are happy to be here, but what I find strange are the priorities of this government. Despite everything that needs to be done, guess what is the number one priority to get through today? This bill that will give a $4-million break to the distilling industry. That is exactly what it is. I find that very strange.
This government is going to give the distilling industry a $4-million tax break, that is really what it comes down to, and we will be picking up the tab. Their taxes will go down $4 million and the Ontario taxpayers will pay $4 million more. That is exactly what it is, and any kind of rhetoric that says all we are doing is making the tax system fairer is nonsense. What the government is doing is reducing the taxes of the distillers by $4 million and sticking it to the Ontario taxpayer to the equal tune, because somebody has to make up that difference to the municipalities, and that is the Ontario taxpayer. It is as simple as that. Any kind of nonsense about their making the tax system fairer is laughable.
Of course, the other aspect is, why is this a priority? Why did this get bumped to the head of the legislative agenda? Do I see the fine hand of the Minister of Industry, Trade and Technology in here again? Is this the Monte Kwinter business lobby at work again? Is that what it is? I would ask him, why?
I would ask all those government backbenchers, why is it that this became a priority? Did they ever hear at their caucus meetings before last week that this was a priority item? Not a chance. My friends have been bamboozled themselves by being told at the last minute that this suddenly had become a priority item.
Do the members know what else? This bill is retroactive to 31 December 1988. It is retroactive to December 1988, regardless of when it is passed. Why are we now passing retroactive legislation? It is indecent enough that the government is doing this, making the taxpayers pick up a $4-million difference in order that the distillers will not have to pay it. But they are also making it retroactive to -- sorry, I was wrong on the date -- 1 December 1988. That is what they have made it retroactive to.
Why? I did not hear the minister indicate why it was so necessary. Why would he not say, if he insists upon doing it, 1 December 1989? Why? One does have to wonder what put this at the top of the list. If it was not the Monte Kwinter business lobby, what was it?
Mr Laughren: I wish that government members --
Hon Mr Kwinter: Did I hear my name being taken in vain?
Mr Laughren: Yes, I am glad that the Minister of Industry, Trade and Technology is here, because I suspect he is the reason that this bill to subsidize the distillery industry to the tune of $4 million a year, reducing its taxes by $4 million, is at the top of the legislative agenda.
What other group, what individuals out there in society have had their taxes reduced in living memory? I do not know of anybody who has had his taxes reduced. But the distilling industry? “Oh, yes, we have to do something for the distilling industry.” I really do question it.
For the Minister of Revenue to say that the tax system presently is unfair is truly remarkable. I happen to agree that we have an unfair tax system, but for the Minister of Revenue to sit in his place while at the same time we have a single person in Ontario who earns $10,000 below the minimum wage paying provincial income tax and a family with an income level also $10,000 or $12,000 below the poverty level continuing to pay income tax -- at the same time, they allow that to remain and they reduce the taxes of the distilling industry by $4 million a year.
Those are truly perverse priorities for this government. I can think of no other reason than the Monte Kwinter business lobby at work behind the scenes, not only to get this bill through but to put it at the top of the Legislative Assembly agenda here in the month of July 1989. It is truly remarkable.
It is not as though we have done anything at the other end of the scale to increase revenues from this very profitable sector. We still do not have a minimum corporate income tax in Ontario. Despite the fact that they even have one in the United States, for heaven’s sake, we do not have one in Ontario. Oh, no, that might offend some of the Minister of Industry, Trade and Technology’s friends presumably.
It is not as though the municipalities and the school boards are rolling in money. In 1985, this government promised that school boards would have their share of educational funding in this province reduced to 40 per cent and the province would pay 60 per cent of overall education spending. Since that time, it has almost reversed. The local property taxpayers pay almost 60 per cent and the province pays a little more than 40 per cent.
They have very callously and blatantly broken a promise to the people of Ontario, and here we have them sticking it to the property taxpayer on education and municipal purposes and relieving taxes to the distilling industry. I want to tell members that one has to have a really strange set of priorities and a lot of chutzpah to walk in here, introduce this bill and decide that it is the number one item on the legislative agenda. That really does take chutzpah.
Hon Mr Kwinter: You are building up my reputation with my colleagues.
Mr D. S. Cooke: Certainly not your ego; it is already built up.
The Acting Speaker: Order, please.
Mr Laughren: I am not opposed to people having a drink. I have been known to have one myself, but I do think that we need to put this industry in perspective. Any time anyone talks about the amount of tax on a bottle of liquor or on a bottle of beer or where in this case, the minister thinks people are paying too much in business taxes, I wish that he or anybody who thinks that way would take a look at the social cost of the product that is being produced.
A very rough estimate -- it is true that these costs have to be rough, but the social costs of alcohol problems in Ontario really are--is that it is about $2.6 billion in health care -- these are 1987 figures -- $554 million for law enforcement, $1.2 billion for reduced labour productivity and $391 million for social welfare in 1984. All those are costs associated with the consumption of liquor. I think that we do need to put in perspective who picks up the tab for that. The Ontario taxpayer picks up those tabs and, in some cases, the business community picks up the tab as well in terms of lost productivity.
So I think before the minister starts crying and shedding tears for the distilling industry, he should have a more balanced approach to the problems that are attached to that industry. I am surprised that the Minister of Health (Mrs Caplan) would be so acquiescent in allowing this outrageous bill to go through, given the fact that she surely must understand all of the attendant costs of alcohol consumption.
I would have thought that she would stand up in cabinet to say: “Just a minute If we’re going to give tax breaks to anybody in this province, surely it shouldn’t be the distilling industry.” But obviously she did not succeed. So she is batting zero for infinity, in terms of defending the health care system.
There are all sorts of ways in which this caucus has indicated to the government that it could raise new revenues that we would support, such as the minimum corporate tax and a tax on the net wealth in the province. But the government has chosen to carry on as though it were a Conservative government. Certainly any remnants of reform in this government are very difficult to find in 1989.
I must say that I was very much surprised when the government indicated that getting this bill through to reduce taxes for the distilling industry was to be the number one priority for this week. If the government wants to bring in a new system of taxation based on land, then it should say so and do so. But to pick out one industry because it is the highest and reduce it is truly perverse, and I hope very much for there to be some reconsideration by some of the government backbenchers, because I want to say that the toll is mounting out there and it is legislation like this that is going to take that toll of this government.
If they cannot see it from a sense of fairness, why do they not see it from their own self-interest? I want to tell them that there is no element of fairness in this legislation, absolutely none whatsoever. It is a blatant break to the distilling industry. There is absolutely no sense to the taxation that they are bringing in.
If this was part of an overall package of changing the tax system on land for businesses, then perhaps we could have a debate with some content to it. But what do they do? They insult all of us and the people of Ontario by bringing in a bill that says, “We are going to reduce the taxation on the distilling industry by $4 million.” That is what they are doing. It is truly remarkable.
I do not know how people are going to judge them out there, but I suspect they are going to wonder why in the world they picked this very lucrative industry to give a tax break to. How do they justify that? Is there something I am missing in the game plan of the Liberal government that says, “We want to give” --
Mr Mackenzie: Donations.
Mr Laughren: My colleague the member for Hamilton East says it is corporate donations to the Liberal Party. I do not know that, but I want to tell members that we cannot help but wonder what is going on when there are so many people out there who could use a tax break, such as the single mother trying to raise kids who is still paying provincial income tax and struggling small businesses out there all across the province. Who does the government pick to give a tax break to? The multicorporate, conglomerate distilling industry.
I do not know how they picked that. Did they pick it only because they are paying the highest rate now? Is that the only reason they picked it? Does that mean that individuals earning high incomes and paying the top individual personal tax rate will be the next ones to get a break? What kind of thinking is that’? Who is next? Who do they give a tax break to next and who do we go to see to make sure we are those people?
Hon Mr Elston: Obviously, the Bank of Montreal, with your affinity cards.
Mr Laughren: Or the Minister of Industry, Trade and Technology. Maybe that is who we go to see next. I do not know who we go to see next, but I want to tell members -- the member for Bruce (Mr Elston), of course, would make sure it was the automobile industry. I understand that, and I understand why he does it. We understand very clearly why he has done what he has done with the automobile industry.
Hon Mr Elston: Go to the Bank of Montreal. Join the NDP and get reduced interest rates. You’ve got to be a member of the NDP to get reduced interest rates. That is where that party belongs.
Mr Laughren: I could tell the member for Bruce something about the automobile industry, that bunch of bandits out there in the automobile industry. I must confess, though, that I am angry about the automobile industry, as I am about the distilling industry, because I just got a letter from the automobile industry last week telling me that my rates were going up from $2,800 to $6,000 a year for my car insurance. Is it any wonder that we regard that industry as a bunch of bandits? The member for Bruce is one of those bandits too. He has become inseparable from the automobile insurance industry.
Despite promising to reduce insurance rates, this government has made sure that they have gone up. What do we call people who make a firm promise and then break that promise? Whatever it is, that is exactly what that minister is. That minister promised lower insurance rates and then immediately set about taking every course of action possible to make --
Hon Mr Elston: What kind of deal did you guys make? Cheaper interest rates for NDPers. Others need not apply.
The Deputy Speaker: Order, please. Could I ask the member maybe to choose language that is a bit more parliamentary than calling a member a bandit, please?
Mr Laughren: Mr Speaker, I am sure you would agree that the member for Bruce was being very provocative in his interjections.
Hon Mr Elston: You are being provocative.
Mr Laughren: I do not mind the member being provocative, but he has to be able to take it when it is given back to him.
The Deputy Speaker: Order, please. One member at a time. The member for Nickel Belt will address his remarks through the chair and there will be no interjections from anybody else.
Mr Laughren: Thank you, Mr Speaker. I do not want to go on at too great a length, because I think other people should have an opportunity to savage this government and its incredible tax policy.
This really is part of an overall tax policy. We can say that Bill 37 is simply an act to provide “for a reduction in the business assessment of land used by distillers.” That is really what it is. So the government members surely will not argue that the purpose of this bill is to reduce the business assessment of land used by distillers-- that is what it is -- and that the reduction in that taxation will be picked up by the taxpayers of Ontario. That is clearly what the bill is all about; there is absolutely no question about that. No government member would argue against that.
What they will not tell us, however, is what the real reason for that is. Is this part of an overall tax policy to reduce taxation in the distilling industry? Because they pay the highest rate, is it a signal that everybody else who pays at a higher rate should line up at the door of the government and call for lower taxation too? What is it?
How did they arrive at this particular industry to give a tax break to? There had to be some logic behind it. I do not know what it is and I am hoping that somebody will stand in his place on that side and say, “This is why the distilling industry needs this $4-million tax break every year.” I have not heard a logical explanation for that yet. I would have thought that either the minister or his parliamentary assistant would have been able to give us that answer, but apparently it is not forthcoming.
If I was any of these other industries on that schedule of taxes that they pay, such as the wholesaling and warehousing, such as financial, and even the brewing industry, I would be asking, “Why are we paying more than manufacturing?” Why do these people pay more than the manufacturing industry? They will still be at 75 per cent and manufacturing will be at 60 per cent. What is the logic behind that?
If I were those people, I would be knocking on the government’s door. I would be banging their door down and asking: “Why are you discriminating against us? Why are you just giving the distillers of this province a break and nobody else?” That is what I would be asking them. Because they pay the most taxes? If I were Conrad Black, I would be knocking on the government’s door too, saying: “Hey, I think I am paying too much tax. I am paying more tax than my neighbour.” How in the world does this make any sense whatsoever?
The real insult for me is what they are doing once again to the property taxpayer. I have felt for some time now that if there is ever a tax revolt in Ontario, it will start at the property tax level. That is where it will start, because what they are doing is inappropriate. To be sticking it to the property taxpayer, based not at all on ability to pay, is unfair. It is unseemly of any government that professes to be reform-minded. Absolutely ridiculous. That is what they are doing here.
The bill states very clearly that there will be a government subsidy of -- the bill does not state the percentage actually, but we do know that for the first three years, it is going to be on a sliding scale. Then, for 1992, 1993 and 1994, the section provides for the Minister of Municipal Affairs to make further grants “to compensate those municipalities in which the losses of revenue resulting from the business assessment reduction for distillers are considered by the minister to be significant.”
So, after the first three years, the minister can determine that the reduction in revenues is insignificant for every single municipality. There is absolutely nothing in this act that requires any kind of subsidy to replace that lost revenue after 1991. Absolutely nothing, zero.
So what reason do the municipalities have to believe that there will be any assistance from this government after 1991, given how the government has stuck it to them since it came to power? If I were a municipal politician in one of the 10 municipalities that are going to be affected, I would be mad as hell at the government about this bill.
I sure would be angry, because they can anticipate that they are not going to get any help after 1991. They had better start fighting now, because if the past behaviour of this government is any indication, it is going to pull the plug on them after it is no longer legislatively required to help them, which will be at the end of 1991.
Mr Wiseman: After the next election.
Mr Laughren: Yes. The member for Lanark-Renfrew makes the point that those grants just happen to end in 1991, which in all probability will be an election year. They will get the grants of 1991, 1992, 1993 and 1994, depending on the outcome of that election, of course. We can be sure that those municipalities are going to get it in the ear, as the member for Scarborough-Ellesmere has been heard to say so often.
That is really unfair, too, to say that after 1991 the affected municipalities will get grants depending on whether or not the minister considers their loss in revenue significant. How can they not be significant when we know exactly what they are going to be and the government is subsidizing them for the first three years? Are they subsidizing insignificant losses in revenue? Does that mean then that the government is not going to continue to subsidize them after 1991? That is really what it comes down to. That is exactly what it comes down to.
If I were those 10 municipalities, I would be lined up at the door of the government right today saying that they expect those subsidies will continue. That really is offensive. Here I am recommending something I do not believe in.
Mr Faubert: Heaven forbid.
Mr Laughren: Well, here we are reducing the distillers’ taxes to the municipalities and saying that the Ontario taxpayer will make up the difference. That is what we are saying. The only difference is if the government does not provide the subsidy, the property tax base will do it, which is even more regressive than the consolidated revenue fund in Ontario.
What a Hobson’s choice that is. In one case the government has the property taxpayer making up the difference of the lost revenues that the distillers are now paying and in the other case it has all Ontario taxpayers making up the difference of what the distillers used to pay.
I do not think any fairminded citizen in Ontario believes he should be subsidizing the distillers to that tune. The minister would argue: “That’s not a subsidy. They’re just paying more than their fair share now.” Once again, how many taxpayers out there in Ontario really believe that the distillers are paying more than their fair share of taxes, given the social costs of the product they produce? It is an outrageous assumption on the part of the minister.
I thought his parliamentary assistant would have put him back on the rails and said, “Look, Minister, if you want me to continue to be your parliamentary assistant, then you’d better change this, because I’m not going to be part of any kind of operation that makes the property taxpayers essentially subsidize the distillers in Ontario.”
The member for Scarborough-Ellesmere could easily have resigned from being parliamentary assistant, because I have always believed that is a job that the member for Sudbury (Mr Campbell) should have. I was insulted, and so were the people in Sudbury, when he lost his job as parliamentary assistant before. I thought that was outrageous. I still believe that the people of Sudbury have a right to a parliamentary assistant.
When there are 94 members on the government side, I think the member for Sudbury should be a parliamentary assistant. Since I think the member for Scarborough-Ellesmere is doing a lousy job as parliamentary assistant to the Minister of Revenue, I therefore suggest to the government that the member for Sudbury would make an appropriate replacement for the member for Scarborough-Ellesmere.
Mr Faubert: I think he would make a great one.
The Deputy Speaker: Order, please.
Mr Laughren: Either the member for Scarborough-Ellesmere got hoodwinked by the minister, in which case he should resign, or, second, he is supporting the minister, which is terribly inappropriate given the nature of this bill, and should resign as well. I do not think the member for Scarborough-Ellesmere has any choice at all. I wish that those appointments could be put to a vote of this assembly, but unfortunately we have not democratized the system that much yet.
I hope the minister would be prepared to table with this House as soon as the information is available, not that I am drawing any conclusions or making any inferences in this regard, all contributions of the distilling industry to the Liberal Party in the last three or four years.
Mr D. R. Cooke: That’s all available.
Mr Laughren: I think the minister should be required to table it. Given the nature of politics in Ontario today, I think the minister should be required to table that. I hope he would respond to that when he winds up his remarks.
I just wanted members to know that I am opposed to this bill and that I shall be voting against it because I think it is completely inappropriate. I think it discriminates against all other industries in the province, because all other industries in the province do not produce a product with the attendant misery attached to it that the distillers do. I am not saying that in a sanctimonious way, but rather simply that we recognize that there are particular costs attached to the product produced by the distillers. And for us to say that the distillers simply have to pay the same rate as anybody else makes no sense whatsoever and I do not think the argument can hold water, so to speak.
I think that the minister should reconsider. It would be a precedent for the minister to withdraw the bill at this point in the debate, but on the other hand it would be a good precedent in this case and would perhaps salvage the job of the member for Scarborough-Ellesmere as well, because I would assume that when the cabinet shuffle occurs this summer that it will include parliamentary assistants and that the member for Sudbury will be back where he belongs, namely as a parliamentary assistant. I think that is talent going to waste that should not be allowed to go to waste. I think the member for Sudbury could assist the Liberals in the direction in which they are presently going and I would very much support his appointment as the parliamentary assistant to the Minister of Revenue.
I really did want members to know why I cannot support this bill, why I think it is an inappropriate bill and why I believe that the arguments put forth by the minister are pure nonsense.
Mr Cousens: A number of points have to be raised with regard to Bill 37, and I am very pleased that the Minister of Revenue is present in the House while we have a chance to debate this bill. Even with the Liberals’ majority of 94 seats they still have to bring bills to the Legislature to be considered and they cannot just pass them in cabinet; it cannot be done in secret. Democracy still can work.
Unfortunately, the likelihood of our being able to vote this bill down is impossible, especially with the stampede of 94 members that the minister and the whip will bring forward. But I compliment the minister for being here to participate in this debate. The Attorney General has deigned always to have his parliamentary assistant carry the bills, but here is a minister who is prepared to sit and face the music and I commend him for that. Even though he is bringing in bad legislation, he at least has the courage to come around and face the music
There is one fundamental rule I wish this government would learn, and unfortunately there has been a precedent in previous governments, but it has to do with the fact that it has retroactivity. The government will take a bill, announce it for first reading on 21 June -- just a couple of weeks ago -- and yet the bill is deemed to come into force on 1 December 1988. Why can we not in this province deal with the future? Here you get governments meddling in the past and that is going to create all kinds of trouble for the municipalities that have to work out their budgets and accounting because of what happens with this bill.
The government should start off with a few clean, fresh principles. When it came into power four years ago it was going to be an open government; it was going to be a new approach; it was going to be this, it was going to be that. What we are seeing instead is just an awful lot of bad decision-making -- the kind of thinking that has gone into this bill that really is not able to go beyond to look at some of the other aspects.
I have a series of questions I am going to table and I know that the minister will never answer them, but at least they will be down on the record and I will have at least served my constituents and the people of Ontario by having asked them.
The first one: Why is it that the government has to make it retroactive? There are plenty of ways in which it can deal with municipalities, industry and business, but to come along and consistently try to turn the clock back and deal in the past is not where the government should be going. I find it repulsive and reprehensible that this government continues to try to move things back into the past. What it does is create all kinds of problems for the municipalities involved.
There are four municipalities that are significantly affected by this bill. We have got the township of Thurlow, Collingwood, the township of Maidstone and the township of Amherstburg. These four municipalities have a large amount of land in their jurisdictions that are really part of the spirit business, and they are going to lose assessment because of it. I do not hear any of the Metro Toronto members defending the needs of Toronto, Scarborough or Etobicoke, which are all going to be impacted in a negative way because of this bill. Where are all these Liberal backbenchers and what are they doing to protect their municipalities? Sweet nothing.
The member for Scarborough-Ellesmere, even there, as the parliamentary assistant to the minister, has had every chance to try to influence this government to do something to protect his own constituents in Scarborough and he has done zip all. I am almost inclined to agree with the member for Nickel Belt (Mr Laughren) and suggest that we get the member for Sudbury in as parliamentary assistant. Maybe we should promote the member for Scarborough-Ellesmere to cabinet minister, make him Minister of Transportation, and we will see just how skittish he is.
I have to say there is a serious problem with this bill and it has to do with the impact it is going to have on a large number of municipalities. What do they have to say about it? They hardly have a chance to say anything, because it came in on 21 June and now here we are on 4 July and it will be passed. We will resist, we will comment, we will try to put forward other arguments, but I know when we have got the Minister of Revenue nothing gets in his way. The Minister of Revenue has a way of winning every battle. Even though he is only a messenger most of the time, this happens to be one of the times that he himself has been involved with it.
I notice his own municipality is not impacted; I do not see Vanier affected. I guess he had some concern there, for his own community, which raises the question of why the minister is doing this. Who put him up to it? Is he going to tell me that no one influenced his thinking, that it just came as a brainstorm that took place across the street in his office one day? I would like to know why it is he has to proceed with this immediately and why it is so important that it be done. It is imperative that the minister understand and we are able to understand his thinking. We do not, as it stands.
I would like to know if the minister has had any consideration as to the impact this bill will have on the free trade agreement between Canada and the United States. Does it in any way affect our countervail? Has he considered if it does or does not? I know this government has been opposed to the free trade agreement right from the beginning, but does it have any implications by virtue of the preferential treatment he is now giving one industry over another? I am not just sure.
I would like to know if there are any other industries this minister is looking at as to whether they are receiving any kind of preferential treatment and whether he should be doing something to relieve them of the extra burden they are having. If this in the name of fairness, which is what the minister is trying to present by giving this bill to the House to debate, why then does he not look at other businesses and other companies or other communities that have a special need?
I would also like to know why the minister has not begun to look at some of the other areas in the assessment of municipalities that need to be looked at. Why has he not begun to look at the Condominium Act to see what can be done there to protect condominium owners? I have a condominium in my own community, and it is really quite dreadful what has happened to them. They put the deposit down on their condominium and that deposit is their down payment. It turns out that does not get considered by the tax laws. They get a T-5 form or something that comes back after it has been sitting there for a year and they have to pay income tax on the interest that was earned on the deposit for their condominium. That is a part of the act that needs to be changed.
Also, the fact is condominiums are assessed on a far more frequent basis than are other dwellings. Why not deal with assessment as it touches upon the whole of our community? If it touches on one business, let’s see what we can do to correct any problems in other areas. If there are problems with the Condominium Act, why not open it up? What we see this government doing is just piecemeal action here and there, coming along, “We’ll touch this, we’ll tamper with that,” and then what you end up having is the kind of confusion I am going to talk about in a moment.
I happened to think back to the days when there was another minister in his portfolio. He said, “The best thing that could ever happen is if we had a session in which the Minister of Revenue brought forward no bills.” That would be a pleasant moment because it would mean no surprises, no extra and additional burden on the taxpayers across the province. Usually it is just a bad news ministry. He comes out and he just keeps on hurting and hitting at the small people. This is an occasion when he is coming out to do a favour for one particular industry, but it is not a consistent pattern.
What I would like to see is a minister who is in fact going to be taking seriously the need for having balance and doing the right thing. What is happening here now is that all the municipalities are again picking up the bill. What this government has done in the last four years is pass the responsibility for more and more things on to the local municipality and not give them the funding and the support to do it. Therefore, the local property owner is paying more and more taxes.
In my own community, taxes have gone up by something like 17 per cent and there are other communities around that have had increases, as well. This year, it is the exception if a municipality did not have an increase of at least 10 to 15 per cent. What is going to happen is that next year and the year after that we are going to have another increase in municipal taxation levels of 10, 15 or 20 per cent, so that within five or six years we are going to see a doubling of property taxes because this government here at Queen’s Park has withdrawn its support and is forcing the municipalities to carry the whole load.
This has happened in so many other things. The unconditional grants for 1989 have been frozen at the 1988 level. In making this decision, the province has effectively ignored its own established grant-setting formulae. This province again has impacted in a negative way on the municipalities through the retail sales tax that went up last year. They all had to pay the extra sales tax; they had not budgeted for it and therefore there is an additional amount of money they have to raise in order to pay for those sales taxes. There is the gasoline tax. Again, when you have the large budgets that the municipalities in and around the greater Toronto area and the other large cities have, it becomes a large, extra burden on the local ratepayer to pay the gasoline tax.
I would like to say that the Minister of Labour (Mr Sorbara) came along and he came forward with pay equity, which is costing municipalities a great deal of money. It is not just in wage adjustments, it is also in the whole implementation of those programs.
A fifth increase in costs for municipalities is the workplace hazardous materials information system. By making amendments to the Occupational Health and Safety Act, which became effective in October 1988, employers and municipalities are required to prepare lists of hazardous materials on their premises and train employees to handle the materials. All this adds to the burden of local municipalities
My reason for raising these first five points and the next 12 that I have to touch upon is that they illustrate that this province is passing more and more of the responsibility on to the local municipalities without giving them the funding and the resources.
By the way, I know the minister will say when I am finished, “I say in this bill in section 2 that I may make grants to help make up for some of the problems.” It is “may.” Why not say that he will make the grants? If the municipalities of Scarborough, Etobicoke, Toronto, Collingwood, Amherstburg and all those others are going to be impacted in a negative way, why does he not guarantee to help carry the costs for them?
Among the other bills that are going into the local municipalities, we have the occupational health and safety bill, Bill 208, which will be argued and debated at length in this place. What will happen here is that the local municipality can face shutdowns and inspections; heavy increases in cost in running the municipality. If the workers’ compensation bill, Bill 162, comes into effect, this will cause employers to provide modified work to employees who have become injured and this will significantly increase municipal salary costs. It is just another way of passing the buck, passing the burden, on to the local municipalities.
The whole roads program is another example of where this government is failing the local municipalities all across this province. The grants available under the roads assistance program for 1989 have been frozen at the 1988 level. Some municipalities will have to spend 100 per cent municipal dollars to undertake routine road maintenance and many new construction projects have to be postponed or cancelled. This is another example of this government’s failing to serve local municipalities.
I support some of the things they are doing for the disabled, but the fact is that by expanding the eligibility criteria for transit for the disabled, it means the local transit systems pick up the extra cost. Again, who pays for it? It will come out of the local taxpayer.
We are seeing general welfare assistance in this province where the rate increases that have been announced again require heavy additional municipal dollars.
On 20 February 1989, the Minister of Community and Social Services (Mr Sweeney) announced a regulatory change that capped the per diem subsidy of extended care in municipal homes for the aged at four per cent over 1988. This will have a serious financial impact for many municipal homes for the aged, with the municipal tax base contributing to the heavy care component of these homes.
I also see this government coming along and setting up draft housing policy statements. What we are seeing then is the changing of the responsibility that municipalities had previously had, now forcing a whole new set of costs on the municipalities in order to provide additional services.
There has not been enough debate in this House on the municipal-industrial strategy for abatement, known as MISA, but MISA proposes to give municipalities the responsibility for monitoring and regulating industrial discharges into the municipal sewer system. Municipal budgets will have to accommodate significant capital costs for upgrading and construction of appropriate treatment facilities, ongoing monitoring of discharges and enforcement costs. Again, this is another reason why I say this government is passing the buck back to the local municipalities and should not be doing so.
I also see the costs associated with the waste management master plans. The provincial legislative and policy requirements have forced municipalities to undertake waste management master planning to guide the management of their municipal waste. These are again an extra cost on the local ratepayers.
Another small one: Local municipalities are expected to contribute up to one third of the cost of hospitals, yet when the new lot levy proposal came out from this government, it forbade the raising of lot levies for their shared component of hospital construction. This is another example where local municipalities are expected to carry a cost in providing hospitals and needed health care, yet this government is taking away the right to raise that through lot levies. It will therefore come through the tax base in each municipality.
We also see this government come forward with Bill 187, the Police and Sheriffs Statute Law Amendment Act. The province is considering this bill, which will require municipal police forces to provide court security. Municipalities will either have to increase police force staffing or reduce police force services elsewhere in order to comply with this bill.
This is my 17th example. I could go on, but I will end at the 17th. The decisions this government has made to force boards of education to provide more and more services, reducing class sizes in grade 1 and grade 2 and increasing the use of computers and educational software, again all add to the costs of running the school system.
Many of these proposals are worthy. Many of them are beneficial, but all of them are happening at once and the government continues to throw them out there and force the municipalities to have to carry the load. I just wish the government would have some way of having some fairness and balance so that there was not this constant hitting and attacking the local ratepayer.
Why does the government not clean up its act here at Queen’s Park? Instead of hiring 7,000 additional civil servants, as they has over the last four years, let’s start controlling their budget and controlling their spending. Let’s start having some equity for everybody. Let’s start bringing laws in that are going to protect and defend every business and every industry across this province.
That is not just coming along and having preferential treatment for one business and not doing it for others. The fact is that here is a government that seems to be influenced by influencers. I do not know who it is or what it was that motivated this Minister of Revenue to come forward with this bill.
I hope he is able to clarify this when he has his final wrapup, because we would like to know why it is he is coming forward with this legislation now. Why is it so urgent? Why is it he is making it retroactive? Why is it he has not examined all these concerns we have about its impact on free trade or the General Agreement on Tariffs and Trade? Why is it this minister has not done something for some of the other industries in this province that need it?
What I see is a government here that operates by ad hockery. It will do something here today and something there tomorrow, but there is no consistent, overall theme or plan.
The fact of the matter is that our caucus will be coming forward with a number of reasonable amendments, including one to remove the retroactivity. Let’s not make it retroactive, as this government has it now. I think it is very important that the minister consider striking out the word “1989” and allowing it to come into effect in 1990.
We realize the government is pretty determined to proceed with this legislation. We will probably support it, but we are very reluctant to do so for the reasons I have given. I just hope this minister will be in a position to explain and answer honestly and intelligently, for all of us to know, why it is he is doing this. This will make it a lot easier for us to support it, should we in fact do so.
The Deputy Speaker: Questions and comments on the member’s statement?
Mr Faubert: One of the points I would like to put on the record, because the member for Markham mentioned Scarborough in this, is that it is obvious he has not had the advantage of reading the projected tax offsetting grants for municipalities, because in the --
The Deputy Speaker: Order, please. It has just been brought to my attention that the member is not in his seat.
Mr Faubert: Okay. Let me run back here.
Mr Faubert: No, he recognized me. It is the eye of the Speaker that should be at fault.
I should point out to the member for Markham, just for his information, that the city of Scarborough’s projected revenue shortfall is exactly $3,427 in the first reduction year, and the bill’s continued additional revenue impact when the assessment is reduced to 75 per cent is exactly the princely sum of $939 on a continuing basis to the city of Scarborough.
When one considers that the overall budget of Scarborough is somewhere around $93 million, we are talking of a very, very small percentage. I just thought I should bring that to the attention of the member for Markham.
Mr R. F. Johnston: Mr Speaker, perhaps I could retaliate on your behalf for that unseemly attack on your eyes by these one-trippers. It is unfortunate this should take place.
I wanted to say that it may be all right for the member for Scarborough-Ellesmere to get up, and in rebuttal of the member say that this is a drop in the bucket in the overall Scarborough tax base, but let me just say this: I have a number of constituents who would love to have a $900 break in the property taxes they have at the moment, which are too high for many of my constituents in Scarborough West.
It is interesting that the choice of the member for Scarborough-Ellesmere is that one should give this break to the corporations that produce the spirits in Scarborough and not to the people in Scarborough themselves, and that there is no protection --
Mr Faubert: You don’t produce --
Mr R. F. Johnston:: Pardon me? Again, he wants to harass, and I might as well -- what is the harassment?
Mr Faubert: It is one small business office in Scarborough.
The Deputy Speaker: Order, please.
Mr R. F. Johnston: We have one small business office. Again, speaking through you, Mr Speaker, and not being drawn into this unseemly discussion, what we are trying to say to the member is that this is his priority as a government, a must-have bill which he is saying reflects one business in Scarborough that should get a break, when not one of my taxpayers in Scarborough, paying property taxes that are too darn high at the moment for education, should have to assume some of these costs he now is taking away from the distillers, who have a perfect ability to pay for this, unlike my constituents.
Mr Wildman: I just want to point out that the member for Scarborough-Ellesmere sounds much better as Bill Wrye or René Fontaine than he does as himself when he speaks from his own seat.
Mr Cousens: It is a surprise to me that the member for Scarborough-Ellesmere would come and say, “It doesn’t matter if we nickel and dime the taxpayers in Scarborough,” because that is basically what he was saying. We take another $900 here and another $900 there and that is what happens. Here we have the philosophy permeating this Liberal government. It does not matter if we come along and take a few more dollars here or there.
If he got more frugal, just held back and did not start spending everybody’s money, then we would end up having a far happier society. It is a fact that there are many people who would love that $900 in their pockets and not having to pay those large local taxes. The fact of the matter is that there is no guarantee by this legislation that this minister is going to reimburse those municipalities.
It is very clear in section 2. Not very many people are privileged enough to be able to read this bill, but I can and it is right there, “The Minister of Municipal Affairs may make grants.” That does not mean to say he is going to and I have no confidence that he will, unless he changes that “may” and says “will.”
It is a surprise that the parliamentary assistant is fighting for his job in public as he has done this afternoon, fighting and grappling in the mud and dirt, trying to protect his minister rather than his own local ratepayers and his own community and municipality of Scarborough, so that they are the ones who are the winners. What in fact ends up happening now is that they are the losers by virtue of not having a defender right there in the minister’s office to make sure they are not going to be taxed and taxed again.
That is all it is. It is just another bit more and another bit more. Before you know it, people cannot afford to own a home or live there any more. We have to do everything we can to bring costs down, bring them under control and that is something this government does not know how to do.
The Deputy Speaker: Do other members wish to participate in the debate?
Mr D. S. Cooke: I just want to take a very few minutes to speak on this issue. The minister will be aware that local members in the Windsor-Essex area have been involved in it for quite some time. In fact, I was quite surprised when I saw the member for Windsor-Walkerville (Mr M. C. Ray) leave the chair and walk in with a file folder. I thought for sure he was leaving the chair in order to speak on this issue since Hiram Walker, one of the biggest distilleries, is in his riding.
I am sure that as a former member of city council, he, as many municipal politicians across this province, is very offended that here we go again with this government, shifting responsibility away from the province and on to municipalities. This is something that certainly the member for Windsor-Walkerville spoke a lot about when he was a member of Windsor city council, but he does not seem to have carried those feelings here.
I have some sympathy for the concerns that have been expressed over the years by distillers. Obviously, the rate of business tax, at 140 per cent, makes absolutely no sense at all when its competition, to a large extent breweries, is paying 75 per cent. I guess one of the other ways of solving the problem would have been to bring breweries up to 140 per cent, or if the government believes that there is a taxation problem with the products that are produced by distillers, then perhaps the Minister of Revenue and the provincial Treasurer should discuss that openly and bring some proposals on the total package of taxation.
Certainly, cases have been made by the industry and by the workers who work for the industry that the increase in taxation -- federal taxes, provincial taxes, business taxes -- have resulted in an inability to compete with some of the other products, and the shift in demand by the public to wines, wine coolers and beers has resulted in jobs being lost.
I think it is important for workers in the industry to look also at the job loss as a result of mechanization and automation in the industry which has resulted in an awful lot of jobs being lost at Hiram Walker’s. I would dare say that the majority of the jobs that have been lost have been lost through automation and not through taxation or even through the drop in demand for distilled products.
I think the minister has really copped out by bringing in this legislation and saying: “There’s a problem with taxation, but we’re not going to pay it. We’re going to pay it for a couple of years, and then ultimately the compensation or the decrease in property taxes to be raised from these corporations is going to be picked up by the property taxpayers.” I think there is no other way for the minister to say it than that that is exactly what is going to happen after three years.
In our area the municipalities, the county, Maidstone and the city of Windsor have expressed serious concerns to the minister about what will happen after that three-year period. They have not shown over the course of discussions unanimous agreement or support of this type of legislation, because they have seen it happen before with the Minister of Revenue that deals are struck, and then after the phase-in period, the province opts out and says, “Raise your property taxes and solve your problem that way.” In areas like Windsor, there has not been a huge increase in assessment. There is not necessarily going to be compensating assessment, and even if there is growth, this is still clearly a shift to property taxes to compensate the distillers.
The minister thinks there is a problem, and I agree. The 140 per cent presents a problem. If that is a problem, why can the minister not make a commitment in this Legislature that there is going to be 100 per cent compensation by the province, that it is a provincial decision and compensation is going to be indefinite, that it is going to go on indefinitely, and build that into the system?
In terms of school boards, the minister has said absolutely nothing. The member for Nickel Belt has made it very clear. His compendium of information that he has sent out says that the loss of assessment to school boards will be compensated through the general legislative grants. Can the minister tell me what that does for a place like the county of Essex or the city of Windsor, where they both spend over the ceilings?
The minister has his ceilings for the purposes of grants, and any expenditures over and above the ceilings have to be raised 100 per cent by the local property taxpayers. All school boards, with the exception of a couple in the province, spend over the ceilings, so that means the school boards are going to have to raise money locally, because the only portion that will be compensated will be that amount of money that is granted under the general legislative grants under the spending ceilings.
There is going to be a significant shift to school board supporters now that we are going to be sharing some commercial and industrial assessment between the two boards. Both the school boards are going to suffer, and local property taxpayers are going to have to pick it up again. We are going to see property taxes rise as a result of this.
Municipal taxes are definitely going to be very substantial. In the figures I have down our way that were presented to us a year ago, for example, the county school board, I believe, is going to lose assessment in the area of $149,000 in the Amherstburg area alone, and in the Maidstone area, $498,000. I believe the figure in the city of Windsor for Hiram Walker’s is going to be a loss of $800,000 and something in assessment to the city. Who is going to make up this lost revenue? Who is going to pay? The province is going to cover it for a few years and then after that we are going to have to pick it up as local ratepayers.
I think it is terribly unfair and I think the minister is being less than totally honest with the ratepayers of this province when he does not tell them that school boards are very much going to be affected as well. In fact, school boards have not even been involved in the negotiations, as far as I know. In the meetings that the minister held and the meetings that my office staff attended, school boards were excluded from the discussions. Municipal councillors were brought in and that is it.
As has been pointed out by my colleague the member from Hamilton on many occasions, I would encourage the minister to look at the system of business tax assessment and come up with a rational system, instead of having the percentages all over the map: manufacturing at 65 per cent, distillers currently at 140 per cent and breweries at 75 percent. I am not sure where wineries fit in in this. I ask the minister what wineries are at. What percentage are they at?
Hon Mr Grandmaître: They are at 60 per cent.
Mr D. S. Cooke: So wineries are at 60 per cent, breweries are at 75 per cent and distillers are at 140 per cent. If he could make the argument that distillers should be brought down to the level of breweries, is he going to be coming back to us in a couple of years and saying that breweries and distillers should be brought down to the level of wineries? They compete; they are in the same market.
I really feel that the municipal taxpayers have been left out of this process and the government is trying to give a benefit to distillers, which have been very profitable over the years and are large companies, multinational corporations that really do not need this kind of tax assistance from the government.
Once again, property taxpayers are going to get it in the neck. The government is giving a few million dollars to the distillers. They expected that this bill would go through in one afternoon and that there would be no discussion on it. Clearly, it has elicited a fair amount of discussion and will continue, I would say, for quite some time.
When we get into committee of the whole, the minister is going to have to answer very clearly to the municipal ratepayers and explain to us and make commitments to us as to what will happen after that three-year period. What are his plans at this point? How is he going to guarantee that property taxpayers are going to be protected?
Mr Speaker, unfortunately, you have gone into the chair, so I cannot make any further comments about participation from other members from the Windsor and Essex area. I will not do that because that would put you in an awkward position.
Finally, I want to express my disappointment. We have written the minister several letters on this matter over the last couple of years. I have some sympathy, as I said, for the issue of the 140 per cent going down to 75 per cent, but I do not think he has at all built in protections for the ratepayers. What he is doing is giving something to the distillers. He is saying that as a matter of principle it is unfair that they pay a higher business tax assessment than other areas in the business field, but he is not prepared to pay for it. He is going to make the municipalities pay for it; he is going to make the local property taxpayers pay for it.
I think that is unfair and that is adequate reason to vote against this bill. It is not because the current system does not need reform; it is just a matter that the way he is reforming the system is incredibly unfair to property taxpayers. It is going to result in one of the most regressive forms of tax going up to pay for a commitment that his party made to distillers, but not a commitment that municipal councillors or municipal politicians made to distillers.
The Acting Speaker: Before we go to comments and questions, I would like to make a statement to the House.
Inasmuch as I have been mentioned by the member for Windsor-Riverside with regard to statements or positions I may have held personally, I want to say to the House that it has been my position that so long as I am in the chair with respect to a particular matter before this House or there is the possibility that I may be in the chair with respect to any matter before this House, it is not my intention to participate in the debate. It is my intention to respect the impartiality of the chair with regard to any such matter, as is the tradition of the chair in all parliamentary democracies.
I would appreciate it if members would respect that and not attempt to draw me into the debate at any time.
Mr D. S. Cooke: On a point of order,. Mr Speaker: I think it is unfortunate and inappropriate that you have raised this matter in the way you just have.
Hon Mr Elston: You raised it.
Mr D. S. Cooke: The member for Windsor-Walkerville, I am sorry, was in his seat as a member of this Legislature when I raised the matter.
Mr Speaker, there is not a tradition in this place for a Deputy Chairman of the Committees of the Whole House to take the position that you have taken. If you want to take that position, then I would suggest that you absent yourself from every vote in this place as well. Otherwise, I think your comments were very inappropriate, and as a colleague of yours in the Windsor area, I intend to hold you accountable for the positions you have taken as a member of this Legislature.
The Acting Speaker: Are there any comments or questions arising out of the statement by the member for Windsor-Riverside?
Mr Laughren: I assume I can comment on either one of his statements, on the point of order or the other. It has been a remarkable turn of events, your most recent comments about not speaking on debates, because I do not know how you make a distinction between not speaking on debates and voting on what ensues from that debate. It really does puzzle me.
However, I wanted to go back to the comments of the member for Windsor-Riverside when he talked about property taxpayers. I could not help but think about the difference between the member for Windsor-Riverside’s plea on behalf of the property taxpayer and the member for Scarborough-Ellesmere, who stated -- and I am sure he will correct me if I am wrong -- that a property taxpayer in Scarborough -- namely, a distiller’s office -- will have its property taxes reduced by $942?
Mr Faubert: It will be $319 on a continuing basis.
Mr Laughren: I would hope that before this debate is completed, the member for Scarborough-Ellesmere will be able to find for us one other property taxpayer in Scarborough who has had his taxes reduced by $319.
The Acting Speaker: Order, please.
Mr Sterling: I would like to indicate the support of our party for this legislation.
Hon Mr Elston: What about the member for Markham? Is this more smoke and mirrors?
Mr Sterling: if the member for Bruce would like me to withdraw my support, I wish he would continue on; I wish he would blow the tradition.
During the time of minority government from 1985 to 1987, there was a bill brought forward to amend the Assessment Act. At that time a presentation was brought before the committee that was dealing with the amendment to the Assessment Act.
It is interesting to note that at that time both the Conservative Party, now the third party, and the New Democratic Party, requested this very change take place in the Assessment Act. The member for the New Democratic Party -- who has a great deal of respect, now of course given an honorary doctorate in the province -- Dr Swart, while he understood many of the arguments put forward by the New Democratic Party, saw that the reduction in the assessment from 140 per cent to 75 per cent of the retail property tax was in fact a fair reduction in view of the fact that the other industries they had to compete with, the beer and wine industries, have tax rates of 75 per cent and business in general has a tax rate of 50 per cent of the realty tax. It is only an anomaly that the distilleries have a tax rate of 140 per cent of the property tax rate.
Both Mr Swart and myself at the time in the committee thought that the tax was unfair after we had heard the presentation from the Association of Canadian Distilleries. We felt so strongly about it that we requested from the Treasurer, who was also the Minister of Revenue at that time, a commitment that this law would be changed. I want to thank the Minister of Revenue for bringing forward the change, because it was a commitment made to a legislative committee that this change would occur. This act is nothing more than a fulfilment of that commitment.
We might meet the arguments with regard to the drop in the revenues of the various municipalities. It was a feeling of the committee at that time that it could not deal with the issue because there was not an adequate guarantee to the municipalities affected that they would have some compensation for this loss of revenue. Since that time, of course, two years have passed. We have a commitment by the Minister of Revenue that over a three-year period there will be some assistance to these municipalities to make up this loss of assessment that they will undertake. I believe that most of these municipalities have agreed, albeit probably reluctantly, to this change in the law.
However, notwithstanding that we do not like to see large corporations get a break, because that appears to be unpopular with the public, I would like to say that we must allow our industries to compete on a level playing field with each other. If the breweries and the wineries have a tax rate of 75 per cent or less, then I think the distilleries should have that same rate. If we want to tax at a higher rate distilleries or people who produce alcohol, then so be it; but let’s do that straightforwardly in another form of taxation.
If we are talking about property taxes, they should be roughly equivalent for all of the people who are involved trying to capture the same market; therefore, my caucus colleagues have indicated to me that they will support Bill 37 on second reading. We hope that the minister in exercising any discretion in assisting the municipalities that are affected will properly take care of the shortfall in revenues that these municipalities will have and, in particular, the smaller municipalities, which will feel the severe blow of a loss of assessment.
With closing remarks, I want to thank the minister for fulfilling the commitment that was made by the Treasurer to both the Progressive Conservative Party and the New Democratic Party in the last Parliament that this legislation would be brought forward.
Mr Laughren: I just want some clarification from the member for Carleton. I was in my place a few minutes ago when I heard the member for Markham, also in the Conservative caucus, speak in a way that I thought was quite critical of this bill and certainly led me to believe that he, not to mention other members of his caucus, was opposed to this bill. Now I hear the member for Carleton speaking in support of the bill. I know this will come as a surprise to members of the assembly, but I am confused. I do not know whether the Conservative caucus is in support of this bill, which will in effect subsidize the distillers at the expense of the local property taxpayers, or whether it is opposed to it.
Mr Fleet: If they don’t know, why should you?
Mr Laughren: I think it is only fair that the member for Carleton be given an opportunity to explain the position of his caucus on this bill. If one of us did not stand in his place in this time slot for comments and questions, he would not have the opportunity to rise in his place and explain it, because the debate would then move on to the next speaker. For that reason, I really think I am doing the member for Carleton a favour by asking him to clarify just what the position of the Conservative caucus is on Bill 37.
Mr Sterling: I want to make it clear to the member for Nickel Belt that our caucus is in favour of Bill 37, but I want to say that we allow, from time to time, dissent in our caucus.
Hon Mr Elston: Creative dissent.
Mr Sterling: Creative dissent. Some will recall that other members of our party have dissented from time to time on issues. We do not see that, in our parliamentary system, as a great detriment to the system. In fact, I would like to see, from time to time, one of the 94 members from the governing party stand up and oppose one piece of legislation.
Mr Laughren: Sterling Campbell will be the first.
Mr Sterling: We have not seen that happen. We have not seen that even from the member for Sudbury, the parliamentary assistant to the Minister of Revenue, as I understand he was appointed earlier this afternoon.
I want to make it clear, As the deputy House leader for our party, I have the House leader beside me here to confirm that our party is foursquare behind Bill 37 but that we respect the opinions of our colleagues. We asked the member for Markham to put his remarks on record so they would be here for posterity.
Mr Charlton: It gives me some pleasure this afternoon to rise to address Bill 37, some very small amount of pleasure, because I had the opportunity to have a brief chat with my old friend the assistant deputy minister for the assessment division when we met out on the front stairs when we snuck out for a cigarette. My pleasure in terms of addressing this bill ends with that friendly meeting downstairs. My comments from that point on in relation to Bill 37 are not very complimentary.
I refer the minister to a number of items that relate directly to property assessment in Ontario and specifically as well to the graduated list of business percentages on which the business taxes have been levied for many years now.
During the 1960s we had the Smith committee on assessment reform in Ontario. The assessment problem has been studied to death ever since that time. We had the Report of the Commission on the Reform of Property Taxation in Ontario in 1977. The Smith report and that report both found the same problems of inequity with the graduated percentages that are applied to create business assessments for the purpose of paying business taxes at the municipal level. They all found that those graduated percentages were unfair -- inherently unfair, internally unfair, comparatively unfair -- and that there was no way you could rationalize any fairness into that graduated system.
Unfortunately, this Liberal government has fallen into the same trap as the Conservative government which preceded it. Having spent endless time and money studying the unfairnesses in the property tax system, having had commission after commission and select committees and so on and so forth, they have failed to muster the political courage to implement the changes which those costly, time-consuming studies have recommended. We are still sitting in a province where for 20 years we have been saying the property tax system is an extremely out-of-date, antiquated and unfair system, yet we have not implemented the legislation that was passed to reform that property tax system.
Specifically in addressing Bill 37 instead of focusing on the whole range of property tax inequities, I would like to focus for just a few moments on the inequities that are inherent in the graduated tax structure which creates the business portion of the municipal property tax.
We have listened to member after member here in this House talking to the Minister of Transportation (Mr Fulton) and questioning him about the need for more government funds for public transit in our urban centres, and for interurban public transit as well for the purpose of trying to discourage commuters from driving from the suburban areas of municipalities and even from the hinterland around those municipalities into the core of the city to work, to park their cars where they work and then to drive home at night; to try to foster a system of some sanity in terms of our transportation in urban centres, so that we do not ultimately end up with the congestive, smelly mess we end up with here in Toronto in terms of the masses of single-owner automobiles that come into this city every day, unnecessarily in most cases, except for the lack of appropriate transit from wherever that person is coming.
We have a government that responds by saying: “We’re trying to do everything we can. We’re pouring hundreds of millions of dollars into urban public transit. What do we do in the tax system?”
We have heard a number of members here today mention that the tax rates for business purposes range from 25 per cent all the way to 140 per cent. I ask you, Mr Speaker, without committing yourself in this debate in any way, to venture a guess as to what might be the lowest rate of business tax in the province under the Assessment Act.
It happens to be car parking: the very thing we are trying to discourage in Ontario, people driving their cars into the downtown cores of our urban centres. What do we do? We make it possible for the car parking industry to keep its prices low enough to continue to attract people away from public transit; 25 per cent is what we charge businesses that operate car parks.
The next lowest percentages are at 50 per cent, and that includes the professions, that is, doctors, lawyers, dentists and so on. At the same percentage rate are also retail stores.
The next step up from that at 60 per cent is manufacturing, and I want you to think about this one as well, Mr Speaker. We have a situation in this province, and right across this country for that matter, where for many years members of all three of the mainstream political parties in this country have been saying that we have to stop being resource extractionists. We have to stop being drawers of water and hewers of wood and we have to start doing some of the resource-related manufacturing right here at home. We do not want to just retail the products that somebody else has made with our resources.
But when manufacturers set up business in this province, we charge them a higher tax rate at the municipal level than we charge for somebody who just retails those items that somebody else made with our resources. It does not make a whole lot of sense in terms of the kinds of economic goals we stand up and talk about day in and day out ad nauseam in this place. If we are going to have business economic growth strategies for Ontario, for Canada, they have to be co-ordinated policies that touch all aspects of government policymaking and government legislation.
I would like to give some examples that fit into the structure that I have just described, some examples of just how ludicrous the application of this system can become and, therefore, why we find it objectionable that the highest rate, the 140 per cent that is being reduced for distillers as a change by itself in an inherently unfair system, is not an adequate approach to legislation where tax fairness is concerned.
It is the chicken way out, if you like, afraid to deal with the mass of the problem that exists province-wide but prepared ultimately to crumble because, as a number of members here today have said, it is limited to an impact on 12 or 14 municipalities and the overall dollar value of the impact is small in the larger scheme of things.
If we really did the job of fixing all the inequities that exist in this graduated scale of business tax assessments, we would have a much bigger political problem to deal with, the same as we have had with the whole question of market value assessment. We run away from that political problem. We will not face up to the political consequences of trying to fix the system to make it fairer for everyone involved.
Back to the examples I wanted to start to make. Just the other day, I had a small businessman in my riding in to see me. He runs a small variety store/snack bar. When I say “small,” I mean very small. His business has been there for about 30 years in the same location, but it is a very small business. It has been a steady business over the years, and he has become an integral part of the community.
But he is now facing not only very serious competition for the last 15 years, I guess, as the chain variety-type stores have evolved out there, but also a new challenge. Because he has a small establishment and because the chain stores for the most part have taken over all the gas stations of yesteryear so they not only have much larger establishments but have parking around their establishments as well, with the 7 Elevens and the Bantams and whatever else. They also have the ability to stock more goods in the store.
This businessman to whom I am referring came to me with a very specific problem, a problem that relates to the bottlers and distributors of soft drinks. It used to be that they would tell him that the minimum order he could buy was 15 cases and he could manage to get 15 cases into his very small storeroom. They have now come in and said: “Look, we are having to make too many trips here to just bring you 15 cases every time you need pop. The minimum order from this point on will be 35 cases.” He is going to have to compete with those chains out there, many of which are owned by the very companies to which we are referring that produce and bottle the pop in the first place, because they have started to buy out those chains.
If we look at this list of business percentages that sets out the business taxes in the Assessment Act, look at how we treat independent retailers and look at how we treat those chain retailers, many of which are associated with manufacturers, we tend to forget the manufacturing aspect of that larger corporate entity. That chain store still operates with the same advantage of the small, truly independent retailer. But are we here doing anything real to fight and to protect the legitimate small businesses in this province?
Mr Speaker, I see you trying to catch my eye to bring the clock to my attention.
On motion by Mr Charlton, the debate was adjourned.
The House adjourned at 1800.