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May 10, 1976

30th Parliament, 3rd Session

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Hansard Transcripts

L054 - Mon 10 May 1976 / Lun 10 mai 1976

POINT OF PRIVILEGE

POLICE WEEK

NATIONAL LOTTERY

HOSPITAL CLOSINGS

LEGALITY OF GOVERNMENT DECISIONS

AID TO ITALIAN EARTHQUAKE VICTIMS

PUBLIC HEALTH NURSES’ NEGOTIATIONS

LABOUR RATES OF ONTARIO HYDRO MOVING CONTRACTOR

CONVICTION OF POLICE OFFICER

FAMILY LAW REFORM

CHILD IMMUNIZATION

HOSPITAL CLOSINGS

LAKESHORE PSYCHIATRIC UNIT

SEXUAL CHARGES

VENEREAL DISEASES IN OTTAWA

LOANS TO MILK PRODUCERS

TIME MAGAZINE

CITIZENSHIP OF MINISTRY PERSONNEL

GRANTS TO CHILDREN’S AID SOCIETIES

LOANS TO MILK PRODUCERS

TRANSPORTATION OF HANDICAPPED CHILDREN

SEXUAL CHARGES

ANSWERS TO WRITTEN QUESTIONS

POINT OF PRIVILEGE

CITY OF THUNDER BAY AMENDMENT ACT

POINT OF PRIVILEGE

CITY OF THUNDER BAY AMENDMENT ACT

CORPORATIONS TAX AMENDMENT ACT

ONTARIO GUARANTEED ANNUAL INCOME AMENDMENT ACT

The House met at 2 p.m.

Prayers.

Mr. Speaker: Statements by the ministry.

POINT OF PRIVILEGE

Hon. B. Stephenson: I have a point of personal privilege, Mr. Speaker. On Friday morning last, the member for St. George rose on a point of privilege asking of you, Mr. Speaker, if I, as the member for York Mills, had breached the guidelines for members’ constituency offices.

Mr. Speaker, as of this date I have not accepted any public funds from this province to operate the York Mills riding office. The costs for that office are presently, and have in the past, been borne by my riding association. Perhaps, Mr. Speaker, in the future, if the member for St. George is worried about my constituency affairs, she might like to ask the question when I am present in the House.

Mr. Lewis: I guess my point of last Friday morning is vindicated, Mr. Speaker. I didn’t get a reply. I just wanted to remind you.

Hon. B. Stephenson: Mr. Speaker, the Leader of the Opposition may have the extra reports that he asked for. They are here.

Mr. Lewis: Oh, how nice of you.

Interjections.

Mr. Speaker: May I also suggest to the hon. members that such matters can often be handled quite well at the Tuesday night late show.

POLICE WEEK

Hon. Mr. MacBeth: I am pleased to announce to the members of the House that this is Police Week, 1976, in the Province of Ontario.

I have just returned from Nathan Phillips Square, where municipal officials and police authorities were on hand to initiate Police Week in the Metro area. Throughout the province this week, many municipal and regional forces are conducting special programmes. I hope a variety of organizations and individuals will mark the occasion with a thoughtful examination of the police function in society, how the police have lived up to their duties over the past year and what our law enforcement goals must be for the future.

Because last year’s theme was so successful the slogan for this year’s Police Week in Ontario is again, “Police Protect People,” which is a very apt phrase. Police officers are much more than crime fighters. As well as needing our police for law enforcement, they protect human life, they safeguard property, they help people in need and they try to prevent crimes before they happen. Yet all too frequently we take them for granted.

At the same time that we are demanding more from our police officers, the public should also be expected to have a fuller grasp of how our laws work and understand better and appreciate the role of police in our society. During Police Week and throughout the year, we remind citizens of our high quality of law enforcement and ask them to consider their personal obligations in helping maintain this standard.

By way of a postscript, I’d like to pay tribute to the member for Kent-Elgin (Mr. Spence) who, I see, is going to co-operate with the police during this week and has determined to become law-abiding. I think that’s a very fine way to start out Police Week.

Mr. S. Smith: What about the member for St. Catharines (Mr. Johnston)?

NATIONAL LOTTERY

Hon. Mr. Welch: For several months now officials representing each province have met with a view to the establishment of a national lottery which would continue on an interprovincial basis to replace the Olympic lottery which has its last draw in August. By mid-March all of the provinces, with the exception of Quebec, had agreed with this proposal and public statements were made by both Premier Hatfield of New Brunswick and a representative of the Western Canada Lottery Foundation, indicating the support of the Maritimes and the western provinces for such an approach. Discussions, I am advised, are continuing with Quebec officials to ascertain their interest in this particular proposal.

Under the interprovincial lottery scheme, each province would determine its own spending priorities for the revenue derived from tickets sold within its jurisdiction. For example, Quebec could use its share of the proceeds to help pay for the Olympic site; the west may choose to fund recreational and sports activities; and we in Ontario are anxious to use our share of the proceeds of this national lottery to support medical research and health-related environmental programmes.

To date, despite the implications such a move would have in Ontario where 40 per cent of Olympic lottery tickets are now purchased, there has been no formal, or indeed informal, consultation initiated by the federal government with the government of this province. Ontario’s support for the 1976 Olympics speaks for itself. We have already committed substantial funds for the construction of the Olympic sailing facilities at Kingston, and through the regular programmes of my ministry we have supported our own athletes and Olympic contenders by providing funds and facilities to further their training.

The success of the Wintario lottery guarantees that support will continue to be available to the sports community after the Olympics are over. Funds have been forthcoming from Ontario for the support of the special cultural Olympic programme that has been planned as part of the Olympic celebration.

As well, in accordance with an agreement entered into in November, 1973, between this province and Olympic Lottery Canada, about $65 million has already been raised in Ontario to help defray the administrative costs of the games from the more than $186 million worth of Olympic lottery tickets sold in this province so far.

There are other priorities, however, which Ontario would wish to support with any new lottery operating in our province. In pursuing with our sister provinces the interprovincial lottery proposal, Ontario has identified medical research and health-related environmental programmes as initial priorities for additional lottery support.

In order that the people of Ontario may more directly benefit from the proceeds of tickets sold in Ontario, it is our intention to continue to pursue the interprovincial approach despite any unilateral action the federal government may wish to take.

Mr. Speaker: Oral questions.

HOSPITAL CLOSINGS

Mr. Lewis: I have a question, first, of the acting Minister of Health. In light of the stunning repudiation of the government’s decision to close the small community hospitals, delivered at 12 noon today in divisional court unanimously by the three judges involved, and in light of the abuse of cabinet power which that decision exemplifies, can we ask her, as a matter of good faith let alone good government, that she reinstate the right of all those hospitals to continue unclosed and choose to save her money elsewhere in her inflated health budget?

Hon. B. Stephenson: Mr. Speaker, while I would not purport to disagree with the hyperbole of the hon. Leader of the Opposition, I have not as yet seen the decision of the judges. When that decision is seen by the Ministry of Health and by the cabinet --

Mr. Roy: We heard it. The ministry doesn’t have to see it.

Hon. B. Stephenson: -- we shall review our position and, of course, shall be reporting to this House.

Mr. Singer: Indeed, it’s about time. Hospital reopening week.

Mr. Speaker: Order, please.

Mr. Lewis: By way of a supplementary, surely the minister knows by now, if only from news reports, that the judges found the use of the Public Hospitals Act to close hospitals for reasons of financial restraint was an abuse of the legislative process and, surely, there is no conceivable way to recapture public sympathy or support of any kind unless she removes or eliminates her original decision? Will she consider that as part of the option before her?

Hon. B. Stephenson: Mr. Speaker, as I said just a few moments ago, I have not seen the decision. I do not know whether the judges considered it an abuse of any kind of process at all. When I have seen the decision and when it has been reviewed with the Attorney General (Mr. McMurtry) the other members of cabinet and the Premier (Mr. Davis), we shall be very pleased to speak to the House on this subject, but not before.

Mr. S. Smith: A supplementary: While the minister is reading the decision of the judges and while she is deciding whether or not to appeal, and while she is preparing an appeal, if that should be her decision, can the various hospitals of this province which the ministry has illegally closed stay open and perform the community functions they’re designed to do while she goes through the various legislative processes before she finally comes to realize that the ministry has acted illegally?

Mr. Nixon: And in receipt of proper grants.

Hon. B. Stephenson: Mr. Speaker, as I said, I do not know whether the judges have decided that this was illegal action or not.

Mr. S. Smith: They did.

Mr. Singer: They set aside the order in council. Isn’t that enough for the minister?

Hon. B. Stephenson: I shall be very happy to remind the hon. leader of the Liberal Party that the hospitals are still functioning until June 1 and July 1 and, of course, will continue to do so.

Mr. Singer: Much longer.

Mr. Lewis: By way of a supplementary, Mr. Speaker, can we have a guarantee from the acting Minister of Health that once the decision has been read and she understands that the judges ruled against the cabinet, funding will continue from the province not only for the four hospitals reinstated by the judges but for all the remaining hospitals which did not go to court and should be saved the expense of going to court?

[2:15]

Hon. B. Stephenson: Mr. Speaker, all aspects of this problem will be reviewed.

Mr. Speaker: A final supplementary.

Mr. Singer: I wonder if the minister, in her reconsideration of the government’s position, would see fit to direct her legal advisers to look carefully at the ability to pass new statutes, to look carefully at whether or not there is a right to discriminate as among various hospitals in amounts of grants, and probably to look carefully at whether or not new and better legal advice should not be made available to the ministry, because its present advice is pretty poor?

Hon. B. Stephenson: Mr. Speaker, unlike the hon. member for Wilson Heights, I am not a legal beagle.

Mr. Roy: You should be.

Mr. Ruston: It would help.

Mr. Speaker: Order.

Hon. B. Stephenson: However, the government of this province has acted in very good faith throughout all of these activities in order to ensure that a very high quality of health care services, which this government has continuously provided, will continue to be provided as economically as possible. If, in fact, the decision of the courts is that the government should not function economically, then I think that is something all of us should examine carefully.

Mr. Singer: That is not what they said at all.

Mr. Lewis: By way of supplementary --

Mr. Speaker: New question.

Mr. Singer: They said you didn’t have power to attempt to do what you are trying to do. That is pretty close to contempt, that one.

LEGALITY OF GOVERNMENT DECISIONS

Mr. Lewis: By way of a new question, since the acting Minister of Health shows neither remorse nor chagrin where the courts have found against the government in clear and explicit terms, is she trying to say to the Legislature that in order to impose her financial restraints discriminately upon these hospitals she will bring legislation before us to do exactly what the courts have now said she is not entitled to do?

Hon. B. Stephenson: Mr. Speaker, if the hon. Leader of the Opposition would simply listen, I made no such statement at all. I simply said we would review the decision and would most certainly be reporting to the House.

Mr. Roy: Supplementary, Mr. Speaker.

Mr. Speaker: Final supplementary.

Mr. Singer: It was a new question -- it’s the first supplementary.

Mr. Roy: May I ask the minister who says that she wants to review the decision, in view of the fact that she is not familiar with the decision, why does she take the approach here this afternoon that because the court has ruled she did not have the power to do what she did under the Act, the court doesn’t want her to save money?

Mr. Singer: Good question.

Mr. Speaker: Order, please.

Mr. Roy: Does she not feel that by saying that, she is coming very close to contempt of court?

Mr. Speaker: Order, please. The main question had to do with possible legislation; so the hon. member’s question is not supplementary.

Mr. Singer: You don’t need to save her -- let her answer. Let her answer.

Mr. Speaker: Order, please.

Mr. Singer: Let her answer.

Mr. Speaker: Order, please.

Mr. Lewis: Is it contempt of court? Because if it is, I judge it to be serious. I would like to know whether the acting Minister of Health will still be with us tomorrow under the circumstances.

Mr. Roy: Let me give you some advice -- don’t go phoning judges.

Mr. Lewis: I have a question, I guess, for the House leader, in the absence of all those who are both notable and notorious. May I ask him, is he prepared to make a review of comparable orders in council and cabinet decisions effected under the restraint programme to see whether or not they are consistent with the public statute, given this unprecedented legal decision?

Hon. Mr. Welch: Mr. Speaker, I would assume the Premier (Mr. Davis), in consultation with the chief law officer of the Crown, would want an opportunity to review this decision of the divisional court, and perhaps we could provide them that opportunity. It’s one on which, no doubt the Premier would want to make some specffic response to that type of question.

Mr. Roy: Where is everybody?

Mr. Singer: Supplementary, Mr. Speaker: Would the House leader not agree that if the decision this morning given by the divisional court relates only to

section 4, subsection 5 of the Public Health Act, any relationship it might have to orders in council in connection with anti-inflation rulings are quite irrelevant and were not covered by the decision this morning?

Hon. Mr. Welch: I’ll keep that point in mind. It will be taken into account when the consideration is being given.

Mr. Roy: Where is everybody this afternoon?

Interjections.

Mr. Lewis: Thank you very much, Bob and Vern.

Mr. Singer: You’re welcome.

Mr. Speaker: Order, please. The hon. Leader of the Opposition has the floor.

Mr. Lewis: You work so nicely in tandem together.

Mr. Singer: Got rid of you on that one.

AID TO ITALIAN EARTHQUAKE VICTIMS

Mr. Lewis: May I ask the House leader on another matter, is it the intention of the government to undertake a specific assistance project either by way of funds or emergency relief for the earthquake victims in Italy?

Hon. Mr. Welch: I think that particular matter is being discussed either this afternoon or tomorrow in some meetings in which the Premier (Mr. Davis) is to be involved. I think the Premier will have something to say about that before the end of the week.

PUBLIC HEALTH NURSES’ NEGOTIATIONS

Mr. Lewis: One last question, if I may, to the acting Minister of Health: Had she noticed that a number of public health nurses are now being locked out by boards of health? I guess the Victoria-Haliburton area is the most recent. Is there any way of rescuing this dispute from the shambles which engulfs it before real problems occur?

Hon. B. Stephenson: I think some real problems have already occurred, as a matter of fact. We have been attempting to persuade the boards of health that perhaps the route would be that which has been suggested by the nurses -- the route of arbitration. That we have not succeeded as yet is unfortunate, I believe. But we are attempting today to discover the specific reasons for this decision by this specific board of health. I don’t know those reasons at the moment.

Mr. Lewis: By way of supplementary, has the minister looked at the apparent violations of good-faith bargaining in the behaviour of the various boards that have locked nurses out or refused to make any offer above the guidelines?

Hon. B. Stephenson: We have not looked specifically at any one board of health in this area. The nurses as parties to the bargaining can lay that complaint with the Labour Relations Board, if they so wish.

Mr. S. Smith: Supplementary: Notwithstanding that the health unit that has locked out the nurses in the Haliburton-Kawartha-Pine Ridge district has on the board one person appointed by the Ontario government, is the minister able to assure us that this reprehensible action of locking out the nurses will result in replacement of that particular member?

Hon. B. Stephenson: I can most certainly investigate this. I did not know there was one on the board.

LABOUR RATES OF ONTARIO HYDRO MOVING CONTRACTOR

Mr. S. Smith: I have a question for the Minister of Energy who reports for Ontario Hydro. Is the minister aware there is a labour scale in the moving contract that was involved in moving the various Hydro offices to the “Moogery” across the street here, but the people who won the contract have not been paying the labour scale to a good many of the employees? Is he also aware that the names of many of the employees who have received less than labour scale had already been given on March 31 to Ontario Hydro and yet no action appears to have been taken? Can the minister tell us what his opinion is in the matter and what he intends to do about it?

Hon. Mr. Timbrell: I intend to investigate the matter.

Mr. S. Smith: Supplementary: Is the minister fully cognizant of the fact that in the tendering for this particular contract, which runs to about $250,000, this difference in labour costs, which amounts to about $100,000, is one that may have caused the winner of the contract to be able to submit a lower bid, knowing all the while that he would get away with paying less than labour scale and that other better bidders could well have come in with lower bids had they played the same game? Can the minister guarantee us that the workmen on that particular job will all receive union scale?

Hon. Mr. Timbrell: The hon. leader of the third party makes certain allegations and certain hypothetical situations. I will investigate and report to the House with a complete report.

CONVICTION OF POLICE OFFICER

Mr. S. Smith: I have a question of the Solicitor General and I guess, this being Police Week, it’s a reasonable question to ask. Could the minister explain to us what his position is with regard to the situation in Peel where a Peel regional policeman has been convicted of a very serious offence -- criminal assault occasioning bodily harm -- which is not just ordinary assault? Does the minister feel it is appropriate that he should be allowed to continue his duties as an officer of the law and, if so, can the minister assure us that he will continue them in a way that doesn’t bring him into the sort of contact with people where this is likely to be repeated?

Hon. Mr. MacBeth: I believe that matter is before the courts still by way of an appeal, but my opinion is that every case does not necessarily involve the same sort of treatment. I was looking at something the other day which referred to one of the occupational hazards, as it were, of being in police work because some amount of force is necessary.

Since it’s still before the courts, I will keep an eye on it, sir, and get an opinion for the leader of the Liberal Party after the court ha determined it.

FAMILY LAW REFORM

Mr. S. Smith: A question for, I guess, the House leader in the absence of the Premier (Mr. Davis) and the Attorney General (Mr. McMurtry). It was indicated in the Throne Speech that the government would be bringing forward legislation on family law reform this spring. Can the minister give us a firmer date as to when this legislation can be expected, especially in view of the report of the federal Law Reform Commission which identifies Ontario as one of the jurisdictions in Canada being very backward with regard to classical property rules between husbandis and wives? When can we expect this legislation?

Hon. Mr. Welch: Mr. Speaker, I know it’s the plan of the Attorney General to bring that legislation forward following its consideration in some committee. It’s at a committee stage now. I think the Attorney General’s plan, because of the nature of that type of legislation, would be to introduce it and to leave it on the order paper so that it could be considered by the people at large over the summer recess.

Mr. Roy: A supplementary: Is the minister saying he’s satisfied that this legislation is going to be introduced before the House adjourns in June?

Hon. Mr. Welch: Yes.

CHILD IMMUNIZATION

Mr. S. Smith: A final question for the acting Minister of Health: In view of public concern with regard to the statements in Ottawa that the public beaches might be closed this summer due to the worries about polio, can the minister make a definitive statement saying whether the beaches will or will not be open? Can she bring us up to date about whether she’s doing any systematic testing for polio virus? The Ottawa situation came out in university tests. I wonder if the ministry is doing any systematic testing of its own?

Hon. B. Stephenson: Mr. Speaker, the studies came out as a result of the work of a student over a period of two or three years, who reported finally to a meeting --

Mr. Roy: Hardly a student. He is a doctor.

Hon. B. Stephenson: Yes, a PhD graduate student, right -- who reported to a meeting in January in Ottawa regarding his findings in the Ottawa River. His primary concern was whether the Ottawa River should be used for recreational purposes in view of the findings that he noted in his report. In actual fact, the viruses he did isolate have been examined and are considered to be mutants of the three usual polio viruses plus a real virus that has no known human pathological significance. It is felt that immunization by the standard mechanism used by the Provinec of Ontario will provide almost complete defence against those viruses in the water of the Ottawa River.

At the present time, the Ministry of Health, of course, has two responsibilities. The first is immunization; the second is monitoring; and these are being carried out. The Ministry of the Environment has the regulatory and remedial legislative functions as well and we understand it is examining the function of the local plants in Ottawa at this time.

To my knowledge, there is no immediate danger to human health from the Ottawa River provided the people who use that waterway are fully immunized.

Mr. Roy: It’s the Rideau River.

Mr. Cassidy: Has the minister been in touch with the regional health unit in Ottawa about this matter? What instructions have gone out from the ministry to other public health units across the province about checking the water conditions in recreational areas elsewhere in Ontario?

Hon. B. Stephenson: Mr. Speaker, we have been in direct touch with the Ottawa district health unit. Of course, we are in constant touch with the other health units throughout the province regarding water testing and other matters.

Mr. Cassidy: But for polio?

Hon. B. Stephenson: For all viruses.

Mr. Speaker: The hon. member for St. Andrew-St. Patrick has a question.

Mr. Deans: I wonder what on?

HOSPITAL CLOSINGS

Mr. Grossman: I have a question for the acting Minister of Health: Would she undertake, say by tomorrow evening, to give some firm directions --

Mr. Roy: What time?

Mr. Grossman: -- to the people at the Doctors Hospital with regard to what exactly they should do in the ensuing weeks, even if she hasn’t made a final decision on appeal or another attempt to close it or whatever? While they’re looking for jobs and patients are refusing to go in there in some cases, would she give them some firm direction as to what they ought to do, one way or another, by tomorrow evening?

[2:30]

Mr. Lewis: That’s a little unreasonable.

Mr. Speaker: Order.

Hon. B. Stephenson: I believe we have provided some firm direction in the past. At the moment, we may continue to provide the same kind of firm direction.

lnterjections.

Mr. Speaker: Order, please.

Hon. B. Stephenson: But it will require examination of the legal decision today before any direction can be made.

Mr. Grossman: Supplementary: Regardless of how we describe the information in the past --

Mr. Roy: You want it in writing.

Mr. Shore: Tell her you don’t trust her; you want it in writing.

Mr. Grossman: The minister will understand that if they have no direction there are going to be employees sitting there who have neither had notices of termination nor will they go out and look for new jobs because they would lose their right to termination notices. They ought to have some direction with regard to a new target date for closing, if the minister intends to continue to try to close the hospital, or some indication that the pressure is off and they are going to stay open. One way or aiother, would she notify them of the current standing of the situation some time tomorrow even if she hasn’t reached a final determination with regard to what she is ultimately going to do?

Mr. Shore: That’s a little unreasonable.

Hon. B. Stephenson: If we could be assured that the members of the staff of that hospital would be informed of the information which is sent to the hospital for their information, I would be very happy to do so. That has not happened.

Mr. Lewis: You do nothing right over there.

Mr. Speaker: Order, please.

An hon. member: You don’t know what you are doing!

Hon. B. Stephenson: That has not happened upon all occasions in the past. However, we shall make all reasonable attempts to keep the staff of the Doctors Hospital as fully informed as possible as soon as possible.

Mr. Nixon: Supplementary: Since the directions that the minister was referring to have been sent to other hospitals, including the Willett Hospital in Paris, and one of those firm directions was to accept no new active treatment patients after May 1, and because of the legal situation the hospital has felt constrained to accept those patients, can the minister assure me and assure the board of the hospital that they will receive the regular grants for the care that, because of the strained situation regarding the legality of the situation, they have had to undertake?

Mr. Shore: They don’t give them any assurance.

Hon. B. Stephenson: Up until this time?

Mr. Nixon: During this period when the situation is somewhat confused.

Hon. B. Stephenson: I can only say that when we have reviewed the legal decision we shall make the decisions which are necessary.

Mr. Singer: Call the Attorney General and have a legal discussion.

Interjections.

Mr. Speaker: A final supplementary.

Mr. Godfrey: In view of the fact that many of the staff are actively looking for jobs today, would it not be reasonable to give them a guarantee that they should stop looking for jobs, at least until the government can come out with a decision and possibly postpone it for a year?

Mr. Singer: “I can only answer as I did before.”

Hon. B. Stephenson: No, Mr. Speaker.

Interjections.

LAKESHORE PSYCHIATRIC UNIT

Mr. MacDonald: I have a question for the acting Minister of Health. May I emphasize that this is not in reference to the child and adolescent psychiatric unit at Lakeshore. My question is, what conceivable justification is there for the Ministry of Health stay order with regard to its closing of those facilities, and ultimate switching of them to 999 Queen St -- a stay order that may be a reversal order? What conceivable justification is there for doing that at this point when there las been a whole year of preparation for the switch?

Hon. B. Stephenson: I do not know all the background for this decision but I shall attempt to enlighten myself about it and report to the House.

Mr. MacDonald: By way of supplementary, I have here a missive that came in a brown paper envelope from the bulletin board of Lakeshore. The first paragraph reads:

It has now been officially confirmed that the borough of York will be transferred from the catchment area of Lakeshore to that of Queen St. Mental Health Centre.

It is dated April 12. Does the ministry have its studies after it has made its decision? When the whole of the borough has made its plans, they have budgeted in 999 Queen for this year and the staff is prepared to move on June 1, does the ministry then have a study and decide it might reverse it?

Hon. B. Stephenson: The hon. member knows very well because I have communicated with him personally the reasons for a possible change in this area. At his request, we have examined it in the light of the potential change at the Lakeshore adolescent unit. As a result of this question, I shall be very pleased to answer him when I have investigated the entire matter.

SEXUAL CHARGES

Mr. Roy: In the absence of the Attorney General, I would like to direct my question to the Provincial Secretary for Justice and Solicitor General. In view of the widespread publicity given to the homosexual ring case in Ottawa or the white slavery case as it has been called at different times, is the minister satisfied, in the context of the whole administration of justice, with the role played by the press, the police, the Crown attorney’s office and the psychiatrists at the Royal Ottawa Hospital?

As an officer of the Crown, is he satisfied, for instance, with the 18 charges that were laid, basically on the evidence of one complainant, one main witness, since that evidence now is deemed to be unreliable and yet some accused have been convicted on this evidence? Can the minister look into this situation and does he not feel that a public inquiry is required in this?

Hon. Mr. MacBeth: Mr. Speaker, some time ago, at the request of the Crown attorney in Ottawa, I asked that a member of the Ontario ProvincIal Police examine some of the questions that my good friend has raised. That examination did take place by a member of the OPP and, as a result, one or two charges are now before the court. I don’t like to hide behind the court, as I have done once before today, but I think in the interests of justice I should do so again, sir.

Mr. Roy: Supplementary, Mr. Speaker?

Mr. Speaker: Providing it is not a question that has to do with the sub judice feature.

Mr. Roy: Oh, no, not at all. Because if I may state, Mr. Speaker, just to reaffirm my supplementary --

Mr. Speaker: A supplementary question might be in order.

Mr. Roy: -- the sub judice applies only to one incident involving the journalist in the case. My question is generally about the whole process of this case. I would like to ask the Attorney General, in view of the fact that the OPP investigation focused basically on the role of the police, does he not feel it would be worthwhile looking at the role of the Crown attorney’s office and the role of the psychiatrists at the Royal Ottawa Hospital? Does he not feel, for instance, that the report prepared by the OPP officer, an Insp. Kotwa, should be made public? Does the minister intend to make that public?

Hon. Mr. MacBeth: Sir, to answer the last question first, no, not at this time. The investigation was not as narrow as my friend suggested it was, and I think much of the information and the matters he’s talking about will come out in the hearing of these charges that I referred to.

Mr. Roy: Not at all.

Mr. Cassidy: Supplementary, Mr. Speaker?

Mr. Speaker: A final supplementary. The member for Ottawa Centre.

Mr. Cassidy: If I can just press this particular question, it is not just the conduct of the Ottawa police who originally unveiled the information about these allegations, but also the Crown prosecutor’s office, which is responsible to the ministry, in deciding to proceed with the cases. Does the minister not feel that that particular action by the Crown prosecutor’s office in proceeding with these cases, which have turned out so disastrously, deserves a full public inquiry?

Hon. Mr. MacBeth: No, I do not. They’re reading into some of the newspaper reports certain allegations that I am not prepared to admit.

Mr. Singer: Supplementary, Mr. Speaker.

Mr. Speaker: No, that was the final supplementary. The member for Durham West.

VENEREAL DISEASES IN OTTAWA

Mr. Godfrey: Mr. Speaker, a question to the acting Minister of Health, dealing with Ottawa. There seem to be a lot of questions about Ottawa. In review of reported incidents of VD -- gonorrhea -- in the city of Ottawa, as reported by Statistics Canada, what steps is the minister taking to bring that matter under control?

Hon. B. Stephenson: Mr. Speaker, as a matter of fact, I have only seen one report from that area which appeared to be somewhat shocking, and the Ministry of Health will, of course, be examining this situation and attempting to resolve the problem of lack of reporting and apparent lack of treatment in this situation.

Mr. Godfrey: Supplementary: Inasmuch as the figures come from the Ministry of Health of Ontario, I query the minister as to whether she has only seen one report.

Hon. B. Stephenson: I have seen one report from Ottawa, sir. That was the statement that I made.

Mr. Philip: Supplementary: Inasmuch as $34 million was allocated in 1975-1976 for health protection and disease prevention, of which I believe $144,000 was for venereal disease control, does the minister feel that perhaps it’s time that some evaluation needs to be done of the processes that are being used in this area? If so, what kind of action, in terms of evaluating the present programmes, is being conducted by the ministry?

Hon. B. Stephenson: I am sure that the hon. member realizes that it wasn’t too long ago that a very serious examination of the processes in this specific problem was carried out and certain recommendations were made, which are in fact being carried out. The programme is being constantly evaluated. This is not, however, a simple issue and I would ask the member to read the publications which one very senior member of the medical profession produced for this province and for this country for a very long period of time, equating the problem of venereal disease with a number of other social problems.

I think this will give the member a much better ijea of the complexity of the problem of controlling venereal disease.

LOANS TO MILK PRODUCERS

Mr. McKessock: Mr. Speaker, I have a question for the Minister of Agriculture and 1ood. In view of the fact that farmers who vent into the dairy business or expanded their production late in 1975-1976 are in a disastrous position and facing bankruptcy due to not being able to obtain quotas to run efficient operations, in view of the fact that the Ontario government, through IMPIP loans, en- couraged this situation and in view of the fact that delaying payments for four months will do nothing to alleviate this situation, is the minister prepared to put forth a programme within the next two weeks to ensure these farmers have viable quotas which is their main concern?

Hon. W. Newman: Mr. Speaker, I agree with the member. We do have a problem especially in the industrial milk field throughout the Province of Ontario. We have a similar problem in many other provinces. The industrial milk programme and the quota allocation is done by the government in Ottawa and I want to make that very clear.

Interjection.

Hon. W. Newman: Just a minute. I’m not sloughing off any responsibilities that we have in the Province of Ontario; I want to make that very clear. As far as the IMPIP loans are concerned -- they were a good idea and they worked well -- we have said that if anybody had an individual problem we would deal with it on an individual basis, and anybody who doesn’t want to make the payments on principal and interest in the next four months does not have to do it. I’ve also said the cutbacks they will take will apply to the forgiveable portion so they won’t suffer because of that.

I’ve had meetings with the Ontario Milk Commission; I’ve had meetings with the chairman of the Ontario Milk Marketing Board and I anticipate the chairman of the Ontario Milk Marketing Board will have something further to say later this week regarding that matter.

Mr. McKessock: In view of the fact that 60 Minto township farmers at a meeting in Harriston and about 500 producers at a meeting at Atwood approved a group of proposals for the provincial government to consider -- and I will send them over to him now -- would the minister give these proposals his serious consideration in trying to arrive at a solution for the dairy farmers?

Hon. W. Newman: Mr. Speaker, I have already made some proposals to the federal Minister of Agriculture in Ottawa. I’ve talked to the Liberal agricultural critic about them and told him what I had done as far as Ottawa is concerned. I am very much concerned about the farmers in the Province of Ontario and of course I’ll have a look at these proposals.

Mr. MacDonald: May I ask the minister with regard to the four-month moratorium which he announced a week or so ago, how is that going to operate since the farmers have dealt with the banks? Has the minister instructed the banks or asked them or ordered them to implement a four-month moratorium on principal and interest payments?

Hon. W. Newman: Yes, Mr. Speaker. We talked to the bankers association on the Thursday and I made the announcement on the Friday. They were to be in touch with their banks across the province as quickly as possible.

Mr. MacDonald: Does this involve a payment by the government to cover the banks -- which, of course, are always impecunious -- for the loss they may sustain?

Hon. W. Newman: All the loans at the bank are guaranteed by the province, as the member is well aware.

Mr. Riddell: I was wondering if the minister has had a reply from Ottawa as to whether the minister there would consider a six per cent reduction in quota rather than the 15 per cent or 18 per cent he’s asking for? Has he had a reply from Ottawa yet?

Hon. W. Newman: No. I Telexed the minister in Ottawa, I think -- I can’t give you an exact date but it was in the past two weeks -- suggesting a less severe cutback of six per cent. I also suggested they take the powdered milk on a pro rata basis and give it back to the dairy farmers who are producing it and paying to remove that surplus. I have not heard anything yet.

Mr. Gaunt: Supplementary.

Mr. Speaker: I announced that was the final supplementary. We may come back to it later if there’s time.

Mr. Gaunt: Supplementary.

Mr. Speaker: No. Order, please. I said that was the final supplementary. The member for Durham East.

TIME MAGAZINE

Mr. Moffatt: Mr. Speaker, I have a question for the Minister of Consumer and Commercial Relations. In view of the fact that approximately 100,000 people are having their contracts with Time magazine illegally converted to other contracts, what action is the ministry contemplating in order to protect these consumers in the Province of Ontario in the light of these significant changes by TimeP

Hon. Mr. Handleman: Mr. Speaker, first of all, it’s remarkable that the hon. member knows these have been illegally rescinded before any court decision has been handed down but, of course, that’s the kind of judgement he makes. We are looking into this kind of thing to see whether or not the Business Practices Act contains any provision whereby some remedy could be provided. However, I should point out to the hon. member, Mr. Speaker, that the basic remedy which is provided is the rescission of the contract, and Time magazine has already offered that to its customers.

[2:45]

Mr. Moffatt: Supplementary, Mr. Speaker.

Mr. Cassidy: Under pressure.

Mr. Moffatt: In view of the minister’s answer, why is it then that a letter written to his ministry over a month ago has not yet been answered by the people in charge of the Business Practices Act?

Hon. Mr. Handleman: Mr. Speaker, I’m not aware of that letter. I’ll search it out and inform the hon. member.

CITIZENSHIP OF MINISTRY PERSONNEL

Mr. Eakins: Mr. Speaker, to the Minister of Community and Social Services: In view of the discussions recently having to do with foreign teachers and foreign students in Ontario, could he tell us how many people of American citizenship are involved under his ministry and, secondly, especially at the Huronia Regional Centre?

Hon. Mr. Taylor: I am wondering, Mr. Speaker, if the hon. member would clarify that, insofar as it may relate to people of non-Canadian citizenship who may be employed by my ministry; or is the hon. member referring to persons who may be teaching in some capacity at one of the institutions?

Mr. Roy: Would you unbutton your jacket so that we can see more of your vest?

Mr. Eakins: Mr. Speaker, I was referring to those employed under his ministry, those in any leadership capacity and at the various centres, especially Huronia; people who are involved in the leadership there, or employed directly.

Hon. Mr. Taylor: Mr. Speaker, for the information of the hon. member, the educational programmes that are run at the institutions, those of a

schedule 1 facility, such as Huronia, are conducted under the auspices of the Ministry of Education, with which we have a working agreement. Now, insofar as reviewing the 9,000 employees who work for the Ministry of Community and Social Services and determining where their citizenships might lie, then that’s another matter. Again, I’m not clear as to the depth that the member may wish to pursue, because it may be that we have employees in my ministry and presumably in other ministries who do not yet have Canadian citizenship.

GRANTS TO CHILDREN’S AID SOCIETIES

Mr. Deans: Mr. Speaker, a question of the Minister of Community and Social Services. Now that the minister has had about seven weeks to review the most recent budgetary requirements of the Hamilton-Wentworth Children’s Aid Society, which asked for 7.2 per cent as an absolute minimum, what is he going to say to them?

Hon. Mr. Taylor: I probably have already said something to them, Mr. Speaker. Most of the budgets have not only been reviewed, but letters have gone out to them. May I point out to the hon. member that, insofar as approval of budgets is concerned, final approval cannot be given until municipal approval is given. In probably most cases now, we have suggested the budget that would receive my ministry’s approval, subject to municipal approval.

I may say that in dealing with those budgets on an individual basis, I did take into consideration the budgetary deficits from last year and which, I think, does concern my friend, and also the proportion or costing in that regard that was attributable to the direct daycare cost or direct costs of children in the care of the Children’s Aid Societies. So, those matters have been considered and if that particular Children’s Aid Society has not received a communication from me, then I would expect that it would do so within the week.

Mr. Deans: One supplementary question, if I may. Can the minister indicate to the House, or will the minister table with the House, the revised budgetary approvals that were given by the ministry for the Children’s Aid Societies across the province in order that we can ascertain just exactly how they’re going to fare in the current fiscal year?

Hon. Mr. Taylor: Mr. Speaker, I would think that when my estimates are considered in the House, which should be shortly, ample opportunity will be given for members to inquire in regard to the particular budget and budgetary items of all of the Children’s Aid Societies, if that is what is requested.

Mr. Lewis: It’s like everything else you do. It’s all arbitrary. Everything is secret.

Mr. Speaker: Order, please.

Hon. Mr. Taylor: It’s not secret at all.

Mr. Speaker: Order, please.

Hon. Mr. Taylor: If the hon. member would like to consult with the various Children’s Aid Societies and review their budgets with them, it’s all public knowledge.

Mr. Warner: Buy a new shredder.

Mr. Cunningham: A supplementary: In recognizing the interest by the members on this side of the House in Children’s Aid Societies and daycare facilities, will the minister provide us with the direction that he is going to be giving them, within the next two weeks I would think?

Hon. Mr. Taylor: Mr. Speaker, if the hon. member would specify the direction that he is referring to I would be happy to accommodate him in that regard.

Mr. Cunningham: The minister just indicated that he is going to be communicating with them -- by letter I would think. Would he share with us the direction that his government is going to give them, so that we might act on their behalf as we have in the past?

Mr. Roy: Remember, you’re the minister.

Hon. Mr. Taylor: Mr. Speaker, may I say that I’ve communicated a number of times directly with the 50 Children’s Aid Societies in Ontario. I don’t propose to give copies of all of my correspondence to the various social services agencies and Children’s Aid Societies to all --

Mr. Lewis: Just take the House into your confidence.

Hon. Mr. Taylor: -- members of the House. There are some 2,000 social services agencies that we fund directly and probably another 2,000 that we fund in one way or another, so I don’t think it reasonable to expect me to send copies of that correspondence to all members of the House.

Mr. Lewis: We will get it anyway. Someone will send it to us.

Mr. Makarchuk: One of the children will send us it.

LOANS TO MILK PRODUCERS

Mr. Gaunt: Mr. Speaker, I have a question of the Minister of Agriculture and Food. Subsequent to the number of questions posed with respect to the industrial milk situation, does the minister have any indication that some of the can shippers in the Province of Ontario are going to give up shipping milk via that route prior to the deadline, which would, in turn, free a considerable amount of quota which could be used by the producers who intend to stay in?

Hon. W. Newman: Mr. Speaker, that matter is being actively considered by the Ontario Milk Marketing Board and it will be making some statements, I’d say later this week.

TRANSPORTATION OF HANDICAPPED CHILDREN

Mr. Foulds: Mr. Speaker, a question of the Minister of Education: What possible reason and explanation can the minister give to the person who wrote him a letter from Thunder Bay, dated May 3, which described the incident that took place on Air Canada flight 852 in which approximately 12 children -- some of them multi-handicapped and all of them deaf -- were returning unaccompanied from Thunder Bay to the school at Belleville, which I believe is under the direction of this ministry? What reason or explanation can he give for that group being unaccompanied?

Hon. Mr. Wells: I don’t have any knowledge of that, Mr. Speaker. I’ll have to look into it and I’ll tell the hon. member the reason, or if it occurred or if it should not have occurred, and why it happened.

Mr. Foulds: A quick supplementary, if I might: Would he have his ministry officials bring letters like this to his attention much more quickly, and would he not agree with the writer of this letter that it is a shame that children with special needs have to travel so far from their families, and if it is necessary it should be done with the same care and compassion that one would have for one’s own children?

I might indicate that on that flight one of the children had a severe emotional attack and there was no one on the flight who was able to cope with it.

Mr. Speaker: You’re supposed to be brief.

Mr. Foulds: There were no trained personnel.

Hon. Mr. Wells: I think my friend is being a little unfair, Mr. Speaker. A letter dated May 8, which is a week ago today, probably arrived in our office sometime Wednesday, and as you know we’ve been slightly busy in this ministry since last Tuesday and Wednesday, and the mere fact that it hasn’t come to my attention doesn’t mean that someone isn’t very concerned about it in the Ministry of Education and, indeed, investigating just what has happened. In fact, something maybe happening without my knowledge, because we had been busy in this House with the Windsor teachers situation, as my friend knows, up until Friday morning.

The other thing is that part of the responsibility in transporting pupils from the school for the blind back and so forth, rests with the local school board. They have certain responsibilities in this area too, and I’d have to look into it to see just who should have been shouldering the responsiblity.

It must be remembered that one of the steps forward we made with pupils at the schools for the blind was to arrange for them to be able to get into their home community and back again much more frequently than they ever had in the past. If proper steps are not being taken to take care of their interests during these trips, I’m sure that that will be taken care of. The member for Port Arthur is being a little unfair in suggesting that I should have seen that letter.

Interjections.

Mr. Speaker: Order, please. We just have time for one more question. The member for Wilson Heights only.

SEXUAL CHARGES

Mr. Singer: I have a question of the Solicitor General and Provincial Secretary for Justice, further to the question put to him by my colleague from Ottawa East (Mr. Roy). In view of the fact that in at least one case in this series of situations whióh my friend talked about, one person was convicted after a non-guilty plea, on the basis of evidence given by a person who was later deemed to be such an unsatisfactory witness that all other charges were withdrawn, and there was a conviction in this particular case; in view of the fact that the police investigation turned up things that warranted the lay- ing of certain charges; and in view of the fact that the judge --

Mr. Speaker: Order, please, will the hon. member shorten his question?

Mr. Singer: -- who made the conviction in this case --

Mr. Speaker: Order, please, there is too much time being wasted here.

Mr. Singer: -- was the head of the police commission, should there not be a public inquily into this whole series of very unusual and tragic circumstances that took place in Ottawa?

Mr. Roy: Accept your responsibility for a change.

Hon. Mr. MacBeth: As I said earlier, I thought there were certain allegations being made or assumed that I wasn’t prepared to admit; one of those was in regard to the ability of the witness to give evidence. Whether or not there will be need to carry this investigation further and to make it more public after the two charges have been dealt with, I don’t know, but I’ll certainly follow it up.

Mr. Singer: The charges are about police brutality. The allegations are about the ability of the Crown.

Hon. Mr. MacBeth: The member doesn’t know, with all due respect, what kind of evidence will come forward in those charges that it had reference to. After they have been heard, I will be prepared to look at it further.

Mr. Singer: They were beaten up by the police; that is all.

Mr. Speaker: Order, please. The oral question period expired two minutes ago.

Mr. Lewis: Mr. Speaker, on a point of order, has the Provincial Secretary for Justice and Solicitor General no intention of making any comment on the RCMP raid over the weekend? Can’t you make him do that before the orders of the day?

Mr. Speaker: Order, please.

Petitions.

Presenting reports.

Hon. Mr. Handleman presented the annual report of the Registrar General for the year ending Dec. 31, 1975.

Hon. B. Stephenson tabled the interim report of Judge Waisberg on the public inquiry into Laurentian Hospital.

Mr. Speaker: Reports.

Motions.

Hon. Mr. Welch moved that private members’ hour for Monday, May 10, be held at 5 o’clock on Tuesday, May 11.

Motion agreed to.

Mr. Speaker: Introduction of bills.

ANSWERS TO WRITTEN QUESTIONS

Hon. Mr. Welch: Before the orders of the day I would like to table the answers to questions 28, 24, 26, 28, 57, 61 and 62 standing on the notice paper.

POINT OF PRIVILEGE

Mr. Lewis: Mr. Speaker, I would like to rise on a point of privilege before the acting Minister of Health leaves the House, if I may, just for an explanation. I believe it’s in order. Are you not supposed to rise on a point of privilege at the moment that something is drawn to your attention?

Mr. Speaker: You’re in order.

Mr. Lewis: I have before me the interim report the minister just tabled of Judge Waisberg, the commissioner. In the recommendation he indicates the three points that he wants followed in the appointment of the new board for Laurentian Hospital. Nowhere do I see him say that Mr. Leber should be a member of that new board. Can the minister explain why she insisted that that was so in the House, or am I reading it incorrectly?

[3:00]

Mr. Speaker: It is really not a point of privilege.

Mr. Lewis: It was a specific response to the question that was put. Well, maybe the minister could get the reply.

Mr. Speaker: I think that would be more in order.

Orders of the day.

CITY OF THUNDER BAY AMENDMENT ACT

Mr. Norton moved second reading of Bill 78,

An Act to amend the City of Thunder Bay Act, 1974.

Mr. Foulds: Mr. Speaker, I wonder if the parliamentary assistant to the Treasurer has an opening statement to make before we proceed with the debate.

Mr. Norton: Yes, Mr. Speaker, if you wish I can do that either now or later.

Perhaps by way of explanation for this particular piece of legislation and the nature of it, I would point out that it is my understanding that in 1974 this Legislature, at the request of the city of Thunder Bay, passed

an Act authorizing Thunder Bay to proceed with the preparation of a request for redesigning the ward boundaries throughout the city. As I understand it, that legislation at that time provided that they would proceed with the preparation of the request and make a request to the Ontario Municipal Board for approval prior to Dec. 31, 1975.

During the year 1975 and the balance of 1974, I understand they proceeded with the study of and the preparation of the new ward boundaries --

POINT OF PRIVILEGE

Mr. Lewis: On a point of order, Mr. Speaker. I am sorry, Mr. Speaker, but I am standing on a point of privilege because I am really distressed about this -- and I want an explanation of it, because we have had an awful lot in the House. I am looking at the letter which was conveyed by Commissioner Waisberg to the government on the Sudbury hospital dispute, and I am reading a sentence which says:

In case these recommendations have not set it forth clearly, it is emphatically my view that no person who served as a member of the Laurentian Hospital board or who presently is a member of the Laurentian Hospital board should now be appointed a director pursuant to your powers.

Now, I want to understand why we got the kinds of answers we got from the acting Minister of Health on successive days in this Legislature. And I ask you, Mr. Speaker, to look at it personally. I am asking on behalf of my Sudhury colleagues, who are not here today.

Mr. Speaker: Yes. I will look into the matter and any feature which I have to comment on, I certainly shall. Thank you. Now, the hon. member for Kingston and the Islands.

CITY OF THUNDER BAY AMENDMENT ACT

Mr. Norton: Thank you, Mr. Speaker. The city of Thunder Bay had prepared their requests for the Ontario Municipal Board approval by the latter part of December of 1975, and at that time they submitted their requests to the Ontario Municipal Board. The board constituted a hearing for early in March of 1976. At the hearing, I might point out, there was an alternative proposal advooated by a group of citizens in the city of Thunder Bay. The city’s application was for approval of a seven-ward system, with the citizen’s group requesting consideration for a 12-ward system, I believe.

Following the Ontario Municipal Board decision, at which time they approved the application of the city for a seven-ward system, the appeal period began. During that period of time, technically, the city was not in a position to present to the assessment commissioner the up-to-date ward boundaries so the assessment commissioner could begin to prepare the electoral information for the 1976 municipal election.

The appeal period for the Ontario Mupicipal Board decision expired following April 1. As you may be aware, Mr. Speaker, the Municipal Elections Act requires that the municipality or the clerk of the municipality present to the assessment commissioner the up-to-date electoral boundaries by April 1 of the year in which the election is to be held.

As a result it was technically impossible for the clerk of the municipality of Thunder Bay to comply with the provisions of the Municipal Elections Act. Therefore, we have prepared this amendment, which would have effect for this year only, to extend to May 15 the period during which Thunder Bay can provide the commissioner with the necessary electoral boundary information.

I expect that at this point it has already made that information available to the commissioner and, in effect, this merely would validate the municipality’s actions so there is no way by which the validity of the elections in 1976 could be challenged subsequently for failure to comply with the Municipal Elections Act.

Mr. Foulds: Mr. Speaker, I do appreciate the explanation given by the parliamentary assistant. I think it will be necessary for us to go into committee on the bill because there are a number of specific questions I want to raise.

It may, unfortunately, disturb some memhers of the Legislature but I want to deal with it in a bit of detail, if I may, this afternoon because it is with some reluctance that I rise to support the bill. I do rise to support the bill as does my colleague from Fort William (Mr. Angus).

I think first of all I would like to point out, perhaps in committee if I might, the bill is significant for what it does not contain. It does not contain the

section which was in at least one of the previous internal drafts of the ministry of the bill which dealt with the Thunder Bay Hydro controversy. I think there are probably very good reasons for that and I think it would be helpful if the parliamentary assistant could, even briefly, give an account of those reasons at the summing up.

Secondly, it does not contain wording, as I believe one of the internal wordings of the ministry for this particular clause did, which would have given the minister the power to direct a 12-ward system. I believe in one of the drafts originally there was wording which would have allowed the minister to direct a 12-ward system.

Very briefly, I want to summarize some of the history. What it does contain, as I understand it and as the parliamentary assistant has explained, is permission to break the Municipal Elections Act for this time only to meet the technical requirements. I think that’s why we support the legislation. I think it would be helpful if a clause could be introduced which would spell out clearly that it is limited to this year only. That isn’t in the bill as it presently exists.

I want, very briefly, as briefly as I can, to outline the whole history of this matter without repeating some of the remarks I made in June, 1974, when the previous amendments, as the parliamentary assistant mentioned, was brought before the House. First of all I personally support and I believe the majority of people in Thunder Bay support a 12-ward system. The OMB decision was for a seven-ward system. There’s been a community battle to establish a 12-ward system since the city was first established.

It has been consistently opposed by the local establishment -- the Chamber of Commerce, the Conservative Party network and by the majority of local aldermen. I recognze the whole argument about the majority of local aldermen being as representative as we are and I admit that. That’s one of the reasons we are supporting the legislation reluctantly.

All this opposition has been to the establishment of the 12-ward system in the face of public opinion. I commend to the parliamentary assistant and the Liberal Party a series of columns written by a very acute city hall reporter, Rita Ubriaco, who was a candidate for the Liberal Party back in 1971, which trace the whole history of this question. She was one person who initially oppose the ward system then came to an understanding of it and supported the 12-ward system.

I’ve read some of those into the record in the past and I won’t do so here but the transfer of the knowledgeable position of a person like her, Miss Ubriaco, who moved from someone favouring the at-large system to the ward system, I think, is revealing.

What bothers me is that what the city submitted to the Ontario Municipal Board was a design for a seven-ward system but what was actually submitted to the OMB was not even the seven-ward system approved by council through resolution. It was modified, albeit somewhat slightly, by the city planner and it was this subsequent seven-ward system that was approved by the OMB.

I want to use this occasion rather blatantly, which I have in legislative terms, to make some observations about the history of that ward system and about the conduct of the OMB hearing in Thunder Bay, large portions of which I attended. I think they speak to the principle of the bill if we, in this Legislature, are going to bring in pieces of legislation which deal with individual municipalities.

Basically, for the information of the members let me point out that the seven-ward system is a system which allows for the election, as it has been submitted to and approved isv the OMB, for two aldermen from each of five city wards -- that is five wards within the old cities of Port Arthur and Fort William. The old city has been divided into five wards and two aldermen are elected from each of these wards. They must be resident in their wards and they are elected only by the people in those wards. That is a basically sound principle, I submit. The other two wards -- rural wards -- elect one alderman each.

As I say, that’s progress. That’s better than the present -- I used the term in 1974 and I’ll use it again -- sort of bastardized at-large ward system. That’s progress but I’m just a little bit tired of being a gradualist -- being faced with these gradual improvements.

Briefly, because I think it is typical, if one likes, of the reasonable, thoughtful, constructive objectors to the seven-ward system, I want to read two pages of the social planning council’s brief to the OMB. “The Lakehead social planning council recommends (

a) a 12-ward block system be adopted for the city of Thunder Bay; (

b) that one alderman per ward be elected from within each ward --

Mr. Good: This is all out of order, Mr. Speaker.

Mr. Foulds: Sorry?

Mr. Good: This is all out of order. The bill has nothing to do with this.

Mr. Foulds: If you will forgive me, Mr. Speaker, it is perfectly in order because the effect of the amendment we are passing today is to allow the implementation of the ward system I’m describing.

Mr. Good: Which is carried out in the original bill to which this is an amendment.

Mr. Foulds: No, that’s not so, Mr. Speaker; that’s why we need the amendment.

Mr. Speaker: Order, please.

Mr. Foulds: That’s very much why we need the amendment.

Mr. Good: Wrong.

Mr. Speaker: The hon. member will present his case and the hon. parliamentary assistant will reply.

[3:15]

Mr. Foulds: Thank you, Mr. Speaker. To continue:

(

c) that each candidate be a resident of the ward in which he or she seeks election prior to the election; (

d) that the mayor be elected at large; (

e) that this system be approved by the Ontario Municipal Board in time for the next Thunder Bay municipal election.

The Lakehead social planning council objects to the present seven-ward proposal approved by city council in a narrow seven to six vote because:

1. It is not the design the majority of citizens of Thunder Bay favour, as shown in two separate studies;

2. It gives the two areas of Neebing and McIntyre the special privilege of being the only two wards with one representative each. This discriminates against the rest of the city;

3. It makes the groupings of neighbourhoods too large and weakens the neighbourhood concept;

4. It was chosen arbitrarily without citizen involvement; and

5. It is not supported by any research as to its workability.

We request approval of the 12-ward block system because:

1. It embodies the neighbourhood concept. Within the city there are distinct neighbourhoods with a strong sense of identity. Studies show that where strong neighbourhoods are encouraged to develop there is an increase in public participation in the life of the community.

2. Citizens will have a specific alderman to contact in each area;

3. It gives citizens a greater chance to get to know the person they are voting for;

4. In case of an extended absence of an alderman, the mayor would be able to act as an alderman at large;

5. Running for office within each particular ward will be less costly, encouraging less affluent citizens to run for office;

6. Citizens will be able to assess the performance of a particular alderman more effectively;

7. In general it will increase citizen involvement in the municipal government; and

8. Two separate studies, one of which was commissioned by the city, indicate strongly that the majority of citizens are in favour of this particular system.

We make this submission in good faith and trust that it will receive your most careful consideration.

I want very briefly to trace the history so that the House can understand why we are considering this particular amendment.

On Nov. 15, 1971, a petition of the people of Thunder Bay, containing 870 signatures, was sent to Mr. Morris, the city clerk of Thunder Bay, by the Thunder Bay Citizens’ Association, requesting that the council petition the Ontario Municipal Board to establish a true ward system in the city. The true ward system was described in the petition as being,

A division of the city into at least 12 geographic units of approximately equal population, following as closely as possible, neighbourhood boundaries -- such as Neebing, one ward; McIntyre, one ward; Thunder Bay P, five wards; and Thunder Bay F, five wards -- and that each ward be represented on city council by one alderman who is resident of the ward from which he is elected by the residents of the said ward.

The reason I am going through this, Mr. Speaker, if you are somewhat puzzled, is to indicate why we have arrived at this time, needing this special amendment to the City of Thunder Bay Act to allow for the extension. It is my contention that the city council procrastinated on this for a period of some four to five years, before we even achieved this kind of progress.

A motion was put before council on Oct. 24, 1972, concerning a plebiscite on the ward system by the city of Thunder Bay, and no support was elicited from council for this plebiscite. It was not until Dec. 2, 1974, that a plebiscite was found on the municipal ballot, and the wording of this was, “Are you in favour of electing members of council to office by a ward system?” I submit that that wording was deliberately vague, as the city council objected to any kind of ward system at that time. It is important to note that of the 36,047 people who voted, 25,607 of them endorsed a ward system; that is a ratio of approximately 2.5:1 in favour of a ward system.

The city council struck an ad hoc committee, back in 1972, to study and report back to council on the ward system. What puzzles me is that they did not bring in more concrete recommendations before the plebiscite was actually put on the ballot so it could have been more clearly defined for the electors and we would not be having to do this at this point in time.

In the municipal election in 1972 -- I need not go into those details, Mr. Speaker; I will skip over that. But during the month of January, 1974, an advertisement was inserted in local newspapers, inviting the electorate of the city to submit options on the ward system to the city council. Many people responded to that; and as a result of those presentations, a motion was passed by the co-ordinating committee of the city council on March 26, 1974, that a plebiscite should be placed before the electorate in the December elections of 1974.

But what was interesting is that committee motion actually had this quote in it: “That a specific proposal for a ward system be prepared for the electorate to express their opinion on.”

And that is important, because if that had been done during the elections of December, 1974, we would have had a clearly defined position of city council that we would not be in the position that we are today with this legislation.

The three readings were given to a by-law authorizing the plebiscite to be placed on the December, 1974 elections on Oct. 27, 1974, but the wording of the actual motion passed by city council and the bylaw was far more vague than the actual recommendations from the co-ordinating committee. I might point out that the co-ordinating committee are the entire members of council, as is the city council; it is just like our committee of the whole House.

The history of the Act is, of course, fairly well known to the parliamentary assistant and extremely well known, I know, to my friend, the member for Waterloo North (Mr. Good), so I won’t go through the history of the amendment in the Act as it has affected us. What I want to underline is that the city council of Thunder Bay really responded only after three years of inactivity to the citizens’ positive support of the ward system. On Tuesday, April 15, 1975, an ad hoc committee, known as the ward committee or committee No. 16, was established.

The committee had been established previously, but on that date they delegated to the city clerk the responsibility of preparing three alternative designs. That was endorsed by council as a whole on May 12 and the study was commenced on May 13 by Mitchell Kosney, the research director. The design committee was composed of Mr. Morris, the city clerk; Mr. Thompson, the director of planning; and Mr. A. G. McKitrick, the city solicitor.

Mr. Kosney presented his report to the city clerk on Aug. 22, 1975, and the committee as a whole presented a report to council on Sept. 23, 1975, to ad hoc committee No. 16.

There were two other surveys being carried on -- one by an opportunity for youth grant and one by Bill Morgan, an alderman in the city who was the unsuccessful Conservative candidate in the last provincial election. He is a fine fellow by the way -- a personal friend of mine.

All three of those surveys were strongly oriented towards wards electing individual aldermen in individual wards. All three of the surveys indicated that. Statistically, for example, 33 per cent in the Kosney survey preferred the 12-ward system; 19 per cent a six-ward system; two per cent preferred a four-ward system; three per cent preferred some other ward system. That is taking out, of course, the extrapolation of those with no opinion and those who rejected the ward system altogether.

So, if you use those statistics as your 100 per cent figure you would find that far more supported the 12-ward system. The OFY study was based on a random sampling that was scientifically accurate using the B/A lock technique, which is recognized as one of the more sound samplings of that type. The figures were very similar -- 30 per cent preferred a 12-ward; 22.4 per cent preferred a six-ward system; and 10.6 per cent preferred a four-ward system.

What was interesting in all this, it seems to me, is that throughout the discussions no mention was ever made of a seven-ward system during the three or four years of the history, and that is what we finally arrived at. The city council initially tried to implement a four-ward strip system, and only 15 per cent of the population supported that. After considerable public opposition, through the press and other methods, the co-ordinating committee of council referred that decision to establish a four-ward strip system back to ad hoc committee No. 16 for reconsideration.

At this point there were some shenanigans at Thunder Bay where they limited the seating capacity of city hall and a new fire regulation came in so that what had been a 200-seat auditorium suddenly became a 100-seat auditorium; it was at this time, on Nov. 12, 1975, that the ad hoc committee adopted a seven-ward system.

I think the city council’s decision was taken in the face of the three studies which showed that the majority of the population favoured a 12-ward, one resident alderman system; and be that as it may, I want to go on record that this is only a partial step toward establishing a true ward system and that the seven-ward system is a politically expedient compromise for members of city council. What is most disturbing to me is that it does not rest on an in-depth study as did the other three alternatives.

Although I would have objected just as strenuously to the ones that I didn’t personally favour, at least the other three alternatives had been researched and the basis for them had been compiled in the three different reports that council had in front of it.

Then we got to the OMB hearings, and I must admit I have a date missing of the exact OMB hearings, although I’ve got it in my diary here because I attended on two of the three days. I think it is fair to say that in spite of the overwhelming weight of evidence at the hearing, presented by the citizens of Thunder Bay and not just by the 12-ward committee, of the desire of people for a 12-ward system, the OMB made a decision favouring the city’s application.

I want to stress that the city’s application was not actually the resolution that was passed by the elected members of council. The city’s application was a seven-ward system designed by the city planner, because he did not approve of the seven wards designed by the elected members of council. That was brought up at the OMB hearing.

What really disturbed me about the OMB hearing is that it seemed to the citizens of Thunder Bay, and it seems to me, that what the OMB hearing did was to give a facade of democracy rather than a genuine opportunity for the appeal procedure in the Act to actually be an appeal procedure. What the OMB decided on was on what a couple of key people in administration of the city council saw as a workable compromise which they could live with administratively. Not only that, the proposal for a seven-ward system was only passed seven-six by council.

None of the elected aldermen or the mayor who voted for that system appeared at the OMB hearing to present the city’s case; they let the case be presented by the administration only.

[3:30]

I can see the necessity for it being presented by administration for technical detail but I think the justification, in political and philosophic terms, should have been by the elected representatives. In this House, for example, we don’t have the deputy minister or the assistant deputy minister answer questions for the minister. He answers the questions even though they may prepare the answers or supply the necessary technical detail. I think it was dereliction on the part of the city council of Thunder Bay that the elected representatives who voted for this did not appear before the OMB.

The OMB decision in this case certainly reminds me of a play recently performed here in Toronto, “The Hearing,” which was about an OMB hearing. The first thing that happened in that hearing -- the chairman and the one other member of the board who was there certainly gave the impression of listening carefully, of being very suspicious of the weaknesses in the case being presented by the administrative officials of the city of Thunder Bay and all of that kind of thing, was it led the people in the audience -- there was a certain raising of eyebrows and whispered conversations behind hands -- to believe that the OMB was seriously considering this.

In the last day-and-a-half it was obvious that the bias of the OMB was toward allowing the seven-ward system as submitted by the administration of the city of Thunder Bay to be passed. As one example of that, there were constant interruptions by the chairman of the OMB when the lawyer representing the 12-ward committee summed up which did not happen in the summing up of the city solicitor.

I submit this can oniy lead to cynicism on the part of the citizens. Why go to the bother of presenting a fairly detailed brief -- which a number of groups and individuals did -- if they are going to be so summarily dismissed and if the explanations of the discrepancies in the city’s position are not going to be alluded to in the judgement of the OMB.

In

summary, I think we support the legislation because the people of Thunder Bay want a ward system of some kind, even though it may be a seven-ward system, for the coming December election. We must pass this amendment at this time to meet the technicalities referred to by the parliamentary assistant because of the procrastination of the city of Thunder Bay. I think that’s a little bit of an abuse of the legislative process.

I think, somehow, that this bill, in a strange kind of way, indicates the importance of a freedom of information act such as has been placed on the order paper by my colleague, the member for York South (Mr. MacDonald). There has been some wheeling and dealing behind the scenes both with city council officials and with the Thunder Bay Hydro officials. I think we do an injustice to this Legislature by bringing in a bill arrived at because of some of that wheeling and dealing and because of the incapacity or the inability of the government to reconcile some of the oonfiicting interest groups behind the scenes.

I think it would be much more easily passed -- this kind of bill -- and the whole question of unity in the city of Thunder Bay would be much better served if there was far more openness between the council and the government, between the government and the opposition members who represent the city, and between the aldermen and the opposition members who represent the city. I don’t doubt the invidious position the parliamentary assistant and his minister are put in by some of the aldermen of the city of Thunder Bay vis-à-vis the two opposition members who represent the city.

As I say, we will support the bill because I believe it achieves a step along the road to a good electoral system in Thunder Bay. I think one of the references to the Municipal Act is made because one of the wards they are proposing will contravene that

section of the Act which says wards can’t contravene provincial electoral boundaries. I believe the McKellar ward will span the Fort William and the Port Arthur constituencies and I think that’s one of the reasons for that. We can talk about that perhaps in a little bit of detail with just a few questions in the committee stage.

I appreciate this opportunity to speak at this length on the bill. As I say, I had spoken at great length in June, 1974, when the previous amendments came up. It is a matter that is of continuing concern to the citizens of Thunder Bay. It’s an important kind of bill because it typifies the juncture and the relationship between municipalities and the provincial government and our divided and different responsibilities in a way that few other bills do. In spite of the reservations, I suppose you could say, Mr. Speaker, I support the bill seven-twelfths because seven-twelfths of a vote is better than no twelfths, although it’s not as good as twelve-twelfths.

Mr. Good: I’d like to say a few words on the bill, mainly to point out how much of the previous speaker’s dialogue was out of order.

The Thunder Bay Act, 1968-1969, as amended in 1972 and also in 1974, allowed the wards as set out in the Act to be used in the 1974 election. The city council was then, in 1975, to apply to the OMB either to confirm that ward system or was given power under the original Act to change that ward system as it saw fit. This was carried out and there was an OMB decision on it. Unfortunately, it was handed down late. It was not until March 31 of this year that the order came down which did not give the clerk of the municipality time to make his return to the assessment commissioner.

All this bill does is to extend the time for the return by the clerk of the municipality to the assessment commissioners, from April 1, I believe, to May 15. The member for Port Arthur may very well disagree with how the wards were set up, but that is not the concern of this Legislature today in the provisions of the bill itself. Maybe he does not agree with the provisions of this bill, but that is another debate.

What we must bear in mind here is that the Act was carried out and the OMB came down with a decision. Whether or not the proper people appeared before the OMB to have the wishes of the people heard or not is not relevant to the debate on this bill, although it’s an interesting topic, I’m sure. The whole Hydro issue up there, the hassle between the public utilities commission and the municipality, is another very interesting dialogue going on in Thunder Bay, one which may never be resolved except in the courts and one which almost reared its ugly head in this bill and had ominous projections all across the Province of Ontario if that particular thing had been legislated to a close.

We support the bill because we see no other way whereby the polling divisions could be set up prior to May 15. The clerk of the municipality does need that length of time to make his return to the assessment offices.

Mr. Speaker: Do any other hon. members wish to speak to this bill? The hon. parliamentary assistant.

Mr. Norton: Perhaps at the outset of my response I might just say I hope that the hon. member for Port Arthur (Mr. Foulds) in his reference to the wheeling and dealing was not referring to my very sincere efforts to be open in consultation with the people, the elected representatives, of the city of Thunder Bay.

Mr. Foulds: No, not at all.

Mr. Norton: I would also add that I went up perhaps with my eyes closed. I didn’t realize there was such a conspiratorial group of Tories up there. In fact, I don’t even know who among the members of the city council I met were Tories. Perhaps before I visit his city again I will check with him just to be sure who I should watch out for.

Mr. Foulds: Not only that, I will tell you the good ones and the bad ones -- ones you can trust.

Mr. Norton: Yes, that’s what I mean.

I appreciate the contributions the hon. member has made in terms of fleshing out some of the history of this particular matter. Both he and the hon. member for Waterloo North have been familiar with this for a longer period than I. I do think, though, that many of the matters that were raised relate quite directly to the hon. member’s opinion and impression of the way in which local elected officials have dealt with the matter over the last several years, and I am not sure that is something upon which I am prepared to comment at this point.

Whatever his impression may be, the intent of this Legislature back in 1974 was to afford the city of Thunder Bay the opportunity to redesign their ward boundaries or establish a new ward system. If the majority of the residents of that city, as the hon. member believes, are in opposition to what has been developed from this exercise, then I hope that the new system -- if it is in effect this December, as it likely will be -- is such that it does not interfere with the democratic process so drastically that they will not be able to express their opinion on that matter directly to the local aldermen in December.

Mr. Foulds: Unfortunately, that is what it does.

Mr. Norton: As has been pointed out by the hon. member for Waterloo North, basically what we are dealing with here is taking a step, subsequent to the Act of this Legislature in 1974, to ensure that Thunder Bay can proceed this year with a valid municipal election. If the citizens had reservations about either the way in which the municipal officials dealt with the matter or, I suppose, even the Ontario Municipal Board, the opportunity did exist for an appeal to that decision.

I might add that one of the reasons the matter was delayed on our part was that we too were waiting to see how much time might be required, because we were equally prepared to act to recommend legislation to the House to enable the implementation of a 12-ward system as against a seven-ward system. There certainly is no bias on the part of the ministry or this government as to the system that might be chosen by the citizens or by the elected representatives of those citizens in Thunder Bay.

Mr. Foulds: You mean you would accept amendments from me in committee which would implement a 12-ward system?

Mr. Norton: I said we have no particular bias. We might not be willing to go contrary to what has been done at this stage by the duly elected representatives of the peuple of Thunder Bay.

I have just one very brief response to the member’s question initially with regard to what was omitted here, rather than what was included; that relates to the controversy between the Hydro commission and the city.

It had originally been my hope that when this legislation came before the House, it could have been a package containing both the portion that is before us and a proposed resolution of the controversy between the Hydro commission and the city. As I think the members realize, the other matter is considerably more complex in terms of the issues that it raises; in spite of that, I had hoped we might be able to have a proposal before the House at this time.

Recently, I have had some additional legal opinions from the legal services available to the government which have raised another issue that has caused us to delay the matter at this point in time. Otherwise, I would have hoped that it could have been resolved by the Legislature with this bill.

Motion agreed to; second reading of the bill.

Mr. Speaker: Shall this bill be ordered for third reading? Committee of the whole House?

Mr. Norton: If that is the wish, yes.

Mr. Speaker: Committee of the whole House, so ordered.

[3:45]

Clerk of the House: The second order, House in committee of the whole.

CORPORATIONS TAX AMENDMENT ACT

House in committee on Bill 45,

An Act to amend The Corporations Tax Act, 1972.

Hon. Mr. Meen: Mr. Chairman, I will propose a number of amendments to sections 16, 18, 19, 20 and 22. I have given a copy of the proposed amendments to the hon. member for Perth (Mr. Edighoffer) and the hon. member for Riverdale (Mr. Renwick) on behalf of their respective parties; and I believe, Mr. Chairman, the Clerk has a copy of them at your table.

Mr. Chairman: The hon. minister indicates he has an amendment to

section 16 of the bill. Are there any comments prior to

section 16 of Bill 45? The hon. member for Riverdale.

Mr. Renwick: Mr. Chairman, I would ask the Chair and the members of the committee to be patient while we work our way through this bill. It is a bill which, of course, relates very much to complementary provisions of the Income Tax Act of Canada. I think I would like to go through it clause by clause, without taking up any undue time, but I would like to have from the minister as accurate a statement on certain sections of the bill as he sees fit to give. I have no comment on

section 1 of the bill because it is complementary to

section 11 of the bill and we can deal with that part of it when we reach that section. It simply relates to small business credit and we can deal with it more appropriately when we get to

section

Section 1 agreed to.

section 2:

Mr. Renwick: Mr. Chairman, I think

section 2 and

section 4, so far as we are concerned, simply show that there must be included in calculating income for corporations subject to this Act any amounts that are received either under the Ontario beef/calf income stabilization programme or under the Western Grain Stabilization Act of Canada.

Section 4 simply allows for the deduction of any fee or levy paid to those two funds, and I don’t think we need make any further comments about

section 2 or, when we come to it,

section

Section 2 agreed to.

section 3:

Mr. Renwick:

Section 3 does deserve some significant explanation by the minister simply because, as I understand it, this

section and

section 8 confer a benefit on corporations which are subject to the Act and entitled to the benefit of

section 3 and of

section 8; I would think the comments on

section 3 and

section 8 could go hand in hand. I am not passing any value judgement on whether or not the benefits should or should not be granted, but I do think the minister should give expression to the reason why depletion allowance is not taken into account to reduce the capital cost allowance or the base upon which depreciation is charged and why, which of course is a benefit to the corporation because the higher the capital cost allowance base the greater the amount of depreciation which may be charged.

Under

section 8, if the Chairman will allow me to deal with it because of its correlative nature, it means that the capital cost of the property, the cost of the property for capital gains tax purposes, is also not reduced and, of course, that is a benefit conferred on the corporation. The change, Mr. Chairman, is interesting and I think the House would be interested in it. The reference is to a deduction allowed from the capital cost allowance for depletion; of course it reflects the very significant change which will take place at the end of this year.

I’m correct on that, am I? It is at the end of this year?

Hon. Mr. Meen: Mr. Chairman, if I understand the member correctly, he’s asking for the effective date?

Mr. Renwick: Yes.

Hon. Mr. Meen: The effective date for this

section is Nov. 19, 1974, which was the date when the comparable federal provision came into effect.

Mr. Renwiek: Right. Perhaps this neecis a little bit of correction. As I understand it, the earned depletion allowance about which we are talking will come into effect at the end of 1976 and the present depletion allowances will cease to apply at the time.

Hon. Mr. Meen: With respect, Mr. Chairman, I find myself in disagreement because it’s my understanding that this section, if we’re looking at

section 3, the provisions fnr the alterations come into effect as of Nov. 19, 1974, to parallel the federal provision.

Mr. Renwick: I think that’s the date it came into the federal Act, but I think the applicable date is actually after Dec. 31, 1976. I’d like to make this comment and then I think we can deal with it. When we come to the question of the depletion allowance -- and of course nowhere in either of the Acts is the term depletion used -- what we are really saying is that because of the wasting nature of the asset it has been advisable for both economic reasons and for tax reasons to allow a deduction in calculating the income of corporations because of the wasting nature of the asset.

Until the present time, and indeed I believe until Dec. 31, 1976, they’re going to use the old method of depletion and at the end of Dec. 31, 1976, the old measure of depletion is going to be replaced by the earned depletion base, which was one of the basic recommendations of the Carter commission; it came through the white paper proposals and was ultimately incorporated in the federal income Tax Act but comes into effect at the end of this year.

My basic and fundamental wish is to make certain that we do understand that so far as this province is concerned we’re basically talking about the depletion allowance as it applies to a mineral resource, that is minerals excluding industrial minerals. It basically applies to the processing of ore from a mineral resource to the prime metal stage or its equivalent and doesn’t apply to timber limits, simply because no regulation has ever been passed to make it apply to timber limits. It does apply, of course, to oil and gas wells but that, unfortunately I guess at this point in time, is not a problem of ours in Ontario.

When one allows a significant deduction of $1 for every $3 expended in certain approved categories of expenditures by corporations from their income, you are conferring a significant and substantial benefit on those corporations. At the same time you are saying to those corporations that even though you have been entitled to this deduction because of the wasting nature of your asset and to reflect in symbolic terms the depletion of that asset, nevertheless you’re allowed to continue -- you’re not required to deduct it for the purpose of your capital cost allowance. I think that’s the first and fundamental question I want to put before you.

The second one is so that the record will clearly show that we are changing the basis upon which the depletion allowance will be granted as at Dec. 31, 1976. I am not going to go into it in any great detail. All of the technical tax books deal with it but I do think it is important that we have the record in this House show that we understand exactly what we are doing insofar as our mineral resource industries are concerned.

Hon. Mr. Meen: The hon. member has asked a number of questions. I am not sure that I can answer as fully as I would like, particularly with respect to his suggestion about the change of calculation method. It may very well be that that could be at another date. But the effective date for the purposes of this

section is still Nov. 19, 1974, and parallel with a similar federal amendment.

The member was asking me to state clearly for the purposes of the House what it is proposed to do, and I think he really stated it reasonably well himself. It is our intention to state as clearly as possible that where a corporation is paying federal earned depletion allowance -- and I emphasize federal earned depletion allowance -- the capital cost of depreciable property isn’t to be reduced in respect of that same allowance. Where they have claimed the one, they cannot reduce the other.

Although the federal earned depletion allowence isn’t meant to be an investment allowance, in some cases it could be construed as such. Therefore, it is necessary -- and that is what this

section does -- to provide that the capital cost of depreciable property will not be required to be reduced by the amount of any federal earned depletion allowance claim. How they are calculated I don’t know. I don’t know whether they are proposing to change them at the end of this year, effective for 1976; that might be. I’ll endeavour to find out for the hon. member, if he would like to have an answer, but I don’t know whether the calculation will be different.

Mr. Renwick: Did the minister say that under the federal Income Tax Act, when they move at the end of this year to the earned depletion allowance, there will be a deduction for capital cost purposes of the amount of that depletion but in Ontario there will not be? Is that what the minister said?

Hon. Ms. Meen: No, I didn’t say anything about the time when they move. What I am trying to emphasize is that this

section is effective Nov. 19, 1974. It simpiy says capital costs shall not be reduced by any claims for depletion allowance.

Mr. Renwick: I think I had better try again. It is my understanding that the reason for the reference to

section 65 of the Income Tax Act of Canada is regardless of the date of the enactment of the provision in the federal Income Tax Act, is because of the transition to an earned depletion allowance basis, and that we are simply saying that’s all right, you get your completion but you also are not required to deduct the amount of that depletion for any depreciable property which you have for the purposes of determining its capital cost, for the purpose of the capital cost allowance.

Hon. Mr. Meen: Let me try it again because I am not sure the hon. member and I are communicating all this well on this section. The Act simply provides that the capital cost of depreciable property must be reduced by the amount of any grants, subsidy or investment allowance received from a government. Although the federal earned depletion allowance isn’t meant to be an investment allowance, in some cases it could be construed as such. Consequently, it is necessary to provide that the capital cost of depreciable property will not be required to be reduced by the amount of any federal earned depletion allowance that they have already claimed.

Mr. Renwick: Why wouldn’t it be? That’s my question. That’s the benefit, the fact that they can have the deduction in calculating their income which is one thing. Not being required to deduct it from the capital cost of their property for depreciation purposes means they are getting a considerable additional advantage. My question to the minister is, why is that necessary?

[4:00]

Hon. Mr. Meen: We are trying to simplify matters by paralleling the federal approach on this. This is not meant to be an investment allowance, so we are treating them differently. Therefore, it does not reduce simply because you have claimed a depletion allowance.

I might add that my staff, in looking at the fiscal aspect of this, indicate to me that it has a negligible revenue effect. In the long run the same costs are charged off -- it just is done in a different mathematical way, and at a different rate.

Mr. Renwick: I am extremely interested in what your staff is saying. It was always my view that if you didn’t have to reduce your depreciation allowance base you therefore had a larger base for the purpose of calculating depreciation, and that’s what this amendment does. In addition, they get it both ways.

All I am saying is that I want it to be clear that there is a double benefit conferred on the corporations, by (

a) going to an earned depletion base at the end of this year for all subsequent years; and (

b) allowing them to maintain the high level of their capital cost base and not be required to deduct it by the amount of the depletion allowance.

That’s all right. It’s a benefit. If the minister cannot explain it, I am quite happy that the record show that we expressed our concern about the easy way in which corporations have benefits without any clear statement from the government as to why the benefit is conferred on the corporation.

Mr. Nixon: This record is going to be a best seller, I think.

Section 3 agreed to.

Sections 4 and 5 agreed to.

section 6:

Mr. Renwick: Mr. Chairman, perhaps the minister would explain the purpose of sections 6 and 7. They refer to the Cultural Property Export and Import Act of Canada, which I think requires some explanation to the House.

Hon. Mr. Meen: I would be pleased to, Mr. Chairman. The intention of

section 6 was to encourage the retention in Canada of cultural property by exempting from tax any capital gain arising from the sale of a valuable cultural object to a designated public authority, or for that matter to a public institution in Canada.

At present, when a corporation sells a cultural object to a public collection, it has to pay tax on one-half of any gain arising after 1971, if the object sold is a capital asset. We consider it a very satisfactory approach toward this subject by simply saying if we want to keep cultural assets in Ontario, then we will exempt the corporations that make those sales to a charitable or public institution or authority from any capital gains tax.

Mr. Renwick: I suppose it does make sense to do so. It makes it extremely confusing for anyone who is interested in trying to understand what these taxing statutes say. We are now going to have a

section in our corporations tax which refers to the criteria set out in paragraphs (

b) and (

c) of subsection 3 of

section 23 of the Cultural Property Export and Import Act of Canada. It refers to a further section, and if one goes to the particular referred section, you find that the criteria set out in paragraphs (

b) and (

c) of subsection 3 of

section 23 of the Cultural Property Export and Import Act refer to “an object in respect of which the application was made is of outstanding significance for one or more of the reasons set out in paragraph 8(3)(a), and meets the degree of national importance referred to in paragraph 8(3)(b). If you go to paragraph 8(3)(

a) and paragraph 8(3)(

h) of the same Act, then you begin to find out what the criteria are to which reference is made in our Act. That is under 8(3)(

a) of the Cultural Property Export and Import Act.

Whether the object is of outstanding significance by reason of its close association with Canadian history or national life, its aesthetic value, or its value in the study of the arts or sciences; and whether the object is of such degree of national importance that its loss to Canada would significantly diminish the national heritage.

I suppose all we’re being asked to do here is to make an exception to the capital gains clause of the bill in favour of certain designated types of items which are of great significance to the national heritage.

I suppnse we just simply have to rely on the people who make the decision as to whether or not that is the case. I can certainly imagine where, from a strictly revenue point of view, there will be a signifieant loss to Canadian revenue by the introduction of this concept into the Corporations Tax Act here and into the Income Tax Act of Canada.

I surely hope we’re not talking about the personal papers of politicians as being matters of significance to the national heritage of Canada, as was the case in the United States. We’re not going to get involved in that kind of a problem. Perhaps the minister could explain why, other than for the purpose of making our Act correspond with the federal Act, we are so eager to provide this benefit to those persons who have these particular objects.

Hon. Mr. Meen: Mr. Chairman, I agree with the hon. member that there is expected to be, of course, a reduction in revenue. There could certainly not be expected to be anything else but that. But if there is a reduction in revenue, it will be because matters of cultural value to Canada do come into the public hands, you might say. We do not know what kind of reduction that would be. I don’t know whether it’s expected to be a large sum or a small sum.

Experience will tell over a period of years what that amounts to. But since it only amounts to a fraction of the value that comes into public hands, then I think it’s fair enough to say that the Treasurer (Mr. McKeough) and the government have considered this a step in the right direction -- as I’ve indicated, paralleling the federal amendment, and giving an assistance toward the acquisition and retention of these cultural objects.

I would have no idea whether they would touch upon the papers of famous public figures; but I suppose that’s a possibility, such as any other heritage that we may enjoy here in Canada.

Mr. Renwick: I think it’s worth a couple of minutes of further discusion in the assembly. As I understand it, the purpose of that federal statute, the Cultural Property Export and Import Act, is that if there is, from the point of view of Ontario, and talking only about corporations, if a corporation in the Province of Ontario, subject to the Ontario Corporations Tax Act, has an object of significant value to the cultural heritage of Canada -- there is a buyer outside Canada who wants to buy it -- then, as I understand it, that the corporation would apply to the review board under the federal Act; that is, this federal Cultural Property Export and Import Act.

If that board decided it was the kind of object that met the criteria that are set out here, and they designate an institution in Canada to which it is then sold, the corporation has the benefit of being (

a) a good fellow because the object has stayed in Canada, and (

b) that that good fellowship on their

part is reinforced because it’s not part of their capital gains, if they’re subject to capital gains in that particular year or any past or future year.

We are conferring a capital gains benefit on corporations by allowing them to go through this procedure by which a designated institution in Canada may acquire ownership of that item.

Hon. Mr. Meen: I would agree with the hon. member that this confers a benefit there. It confers an incentive or it creates an incentive for the companies to dispose of some of these things. I don’t know whether the hon. member has a list in front of him of some of the objects under the Cultural Property Export and Import Act but there is a

schedule to which are attached some values.

I am advised that Canadian archaeological objects, for example, of any value would qualify; Canadian aboriginal arts and crafts, provided they have a value of at least $500; Canadian antique and decorative art in ceramics, $500 minimum; furniture $2,000 minimum; books and documents a minimum value of $500 and so on. They have established certain criteria, as the hon. member has indicated.

I am advised, too, that the board has not yet been constituted under the Act but I would expect it would be constituted in the near future. For that matter, our guess is that this kind of provision probably applies more to individuals than it applies to corporations; that’s one of the reasons we simply don’t know to what extent there would be any reduction in revenue. We don’t know at this stage just what corporations have what kind of cultural objects they might be prepared to sell or give or, in any event, at what prices or values.

As I said at the beginning, I think this is an appropriate step to take. We are interested in preserving our cultural heritage and we can encourage companies and individuals to dispose of assets of this sort without attracting capital gains tax.

Mr. Renwick: All I am saying is that it would appear to me that the government of Ontario had no input into the enactment of that particular statute.

It would have seemed to me that before an object can be exported from the country, and it has the kind of value spoken about, the review must take place. I can understand why it must be designated as to what institution in Canada it should go to, that it should remain in Canada, but it seems to me a little bit much to suggest that persons who have those items or objects -- many corporations have significant items -- should be rewarded at the expense of the revenue for keeping those items in Canada. That’s what I can’t understand about it.

I suppose I never will understand it but that’s what the Act does. It seems to me -- I want to make it certain, to make it clear so far as I am concerned -- that that’s the minister’s understanding of it because, as he says, we are conforming our laws to the federal law and we really don’t know the extent to which the revenue of the Province of Ontario, under the Corporations Tax Act, will be affected by the inclusion of this provision in the bill.

Again, it is another one of these benefits which we unthinkingly grant to corporations in Ontario.

Section 6 agreed to.

section 7:

Mr. Renwick: Mr. Chairman, I think the discussion we had on

section 6 covers in a somewhat different way the same problem which arises under

section 7 of the bill. In that case it refers to listed personal property set out in a particular provision of the Corporations Tax Act of Ontario, in this case, other than property described in -- well, wherever it is, the provision which -- no, this

section 7 refers to the definition of listed personal property. In our regulations, as I understand it, we have a definition that listed personal property of a corporation means its personal use property, that is, all or any portion of or any interest in or right to any print, etching, drawing, sculpture or other similar work of art, jewellery, rare folio, rare manuscript or rare book, stamp or coin. Then it goes on also to define in almost incomprehensible jargon, personal use property of a corporation and to list a number of items which are included in it.

Again, for corporations in the Province of Ontario normally subjected to tax,

section 7 of the bill is a benefit which is conferred upon corporations. We don’t have any knowledge of the extent to which the revenue of the province will be affected by the inclusion of this provision and it falls on the same basis as

section 6 of the bill.

Section 7 agreed to.

section 8:

Mr. Renwick: On

section 8 of the bill, I referred at the time that we were dealing with

section 3 to this whole question of the transitional provision through to the earned depletion basis for mineral resource companies in the Province of Ontario. This simply says that this amendment will make it clear that the earned depletion allowance which comes into effect at Dec. 31, 1976, under

section 65 of the Income Tax Act is not a form of assistance which would reduce the cost of property for tax purposes.

That means for practical purposes .they will be allowed to maintain a high level cost for property which, when otherwise disposed of, would attract capital gains to the extent of any excess gain. By allowing this further deduction it means reducing the revenue of the Province of Ontario to the extent of that deduction so far as capital gains tax is concerned. Is that the minister’s understanding of that provision?

[4:15]

Hon. Mr. Meen: This

section 8, Mr. Chairman, simply corrects an improper cross-reference.

Mr. Renwick: That’s very cute. Read the next sentence.

Hon. Mr. Meen: Oh, well, this is a repeat.

Mr. Renwick: It is not a repeat. It’s the same argument.

Hon. Mr. Meen: Just reading from the explanatory note, the amendment makes it clear that the earned depletion allowance under

section 65 of the Income Tax Act is not a form of assistance which would reduce the cost of property for tax pnrposes.

Section 8 agreed to.

section 9:

Mr. Renwick: On

section 9, the comments we made on

section 8 and

section 3 apply equally well.

Section 9 agreed to.

section 10:

Mr. Renwick: On

section 10 the comments which we made on sections 6 and 7 relating to the Cultural Property Export and Import Act of Canada indicate again quite clearly that a corporation is to be able to deduct from its taxable income the full value of gifts of cultural properties, certified under that federal statute, to a designated Canadian institution or public anthority. I assume we are just making our statute correspond with the federal Act and that the Ministry of Revenue has no knowledge of the extent to which the inclusion of this

section will reduce the revenue of the Province under the Corporations Tax Act of Ontario. Is that correct?

Hon. Mr. Meen: The member is correct in that it does parallel an amendment to the federal Income Tax Act. He is also correct in his statement that again since it is dealing with cultural property we don’t know the extent to which there would be a reduction in the revenues. I can simply say that without the amendment a corporation would be allowed a deduction limited to only 20 per cent of its income for a donation of cultural property made to a registered charity or provinicial government or municipal government. We want to remove -- and that’s what this

section does -- the 20 per cent limitation.

Mr. Renwick: Mr. Chairman, on the same section, would the minister explain, in terms other than the explanatory note, subsection 2 of

section 10?

Hon. Mr. Meen: I’ll certainly try, Mr. Chairman. The hon. member has in front of him a relatively full explanatory note for subsection 2, so I might try to put it another way. It will allow a corporation making a gift of a tangible capital asset to a registered Canadian charity or to the Crown to determine the value of the gift to be used in the calculation of the capital gain arising from the donation and in the deduction for the donation. If the current value of the asset exceeds its costs for tax purposes, then a corporation may establish a value that’s between the cost and the current value.

This again parallels a federal amendment to the corporations sections of the federal Income Tax Act. We want to do this to vary the present provisions which require that corporations use, in their tax calculations in cases like this, the fair market value of the capital assets at the time of the donation.

The corporation isn’t presently allowed any flexibility in adjusting the value of the donation in relation to the corporation’s other capital gains or losses and its other donations. So this will give them the opportunity to select a value within the range, from one extreme to the other.

Section 10 agreed to.

section 11:

Mr. Renwick: Mr. Chairman, on this small business deduction we certainly agree that the proposed

section is an immense simplification over what was formerly again an almost incomprehensible

section for a small business to use in calculating the small business deduction. I’ve no further comments there.

Sections 11 to 13, inclusive, agreed to.

On sections 14 and 15.

Mr. Renwick: We have no comments on sections 14 or 15. They simply extend the benefit to co-operatives and credit unions.

Sections 14 and 15 agreed to.

section 16:

Mr. Chairman: Hon. Mr. Meen moves that subsection 2 of

section 16 be struck out, and the following substituted theref or:

(2) The said

section 115 is amended by adding thereto the following subsection:

(3) For the purposes of subsection 2, insurance corporations and insurers that transact business in Ontario shall in calculating their incomes or taxable incomes,

(

a) be entitled to make the deductions allowed by this Act which they would otherwise be permitted to make were it not for subsection 2; and

(

b) not make the deductions provided in the Income Tax Act of Canada, otherwise permitted by subsection 2, that are prescribed to be not allowed for the purpose of subsection 2.

Hon. Mr. Meen: Mr. Chairman, perhaps I could explain to the hon. members that this amendment to

section 16 which I am just proposing helps the

section accomplish what we set out to do. The

section as drafted, and as appears in the members’ printed copies, does not accomplish that.

The hon. members will notice that in paragraph 2, subclause 3, if we can describe it that way, the words “incomes or” have been added to the third line so that it reads “calculating their incomes or taxable incomes”; those words “incomes or” were omitted. Then, in sub-paragraph (

b) we had incorrectly referred to the Ontario Corporations Tax Act when we should have been referring to the Income Tax Act Canada, in the reference in sub-paragraph (b).

Mr. Renwick: Mr. Chairman, do I take it that the amendment does not affect the taxation of the insurance corporations to which it applies, other than to make a correction of that basis on which the calculation of their taxable income is carried out?

Hon. Mr. Meen: Yes, that is my understanding, Mr. Chairman. I might explain that the section, as it appears in the bill and as I am proposing it be amended, is intended to end the present tie-in with the federal calculations of taxable income of insurance corporations in those areas where the Ontario rules differ from the federal rules.

Motion agreed to.

Section 16, as amended, agreed to.

section 17:

Mr. Renwick: Can the minister explain what exactly the explanatory note purports to say that the amendment does in connection with exploration and development expenses so far as it relates to the calculation of the paid-up capital tax of such corporations?

Hon. Mr. Meen: I will try. Mr. Chairman. It is aimed at restoring to those companies which explore for minerals in Canada, a deduction for their unclaimed balances for Canadian and Ontario exploration and development expenses as at the year-end.

In 1974, the hon. members will recall that Ontario repealed the mine and mill allowance which allowed mining corporations a deduction for their mining assets, including exploration and development expenses. This proposed amendment will be of most benefit to those exploration and non-producing mining companies which experienced sharp tax increases as a result of the repeal of the former allowance.

Under this amendment no deduction will be allowed for expenses incurred in the search for oil or gas, I might point out, including exploration and development expenses relating to the Alberta tar sands.

Section 17 agreed to.

section 18:

Mr. Chairman: Hon. Mr. Meen moves that subsection 1 of

section 18 be struck out and the following substituted theref or:

(1) Subsection 1 of

section 143 of the said Act is amended by striking out “two” in the first line, and inserting in lieu thereof “three”; and by adding thereto the following clauses:

(

c) one-third of the net premiums paid or payable pursuant to a contract of accident insurance, life insurance or sickness insurance, entered into prior to the seventh day of April, 1976; and

(

d) one-third of that part of the net premiums other than the net premiums with respect to which a deduction is permitted under clause (

e) which represents the savings portions of life insurance contracts.

Further, that subsection 2 of

section 18 be renumbered as subsection 3, and that

section 18 be amended by adding thereto the following subsection:

(2) The said

section 143 is further amended by adding thereto the following subsection:

(la) The deduction permitted under clause (

e) of subsection 1 does not apply to premiums paid or payable under contracts of

(

a) Group life insurance, or

(

b) Accident or sickness insurance which are not non-cancellable on or after the first anniversary date thereof which occurs after April 6, 1976; and

(1b) For the purpose of subsections 1 and (1a),

(

a) Accident insurance, life insurance and sickness insurance have the respective meanings given to those expressions by

section 1 of the Insurance Act;

(

b) Group life insurance means insurance other than family insurance as defined by clause (

g) of

section 145 of the Insurance Act, whereby the lives of a number of persons are insured severally under a single contract between an insurer and an employer or other person;

(

c) Net premiums means the premiums determined in the prescribed manner; and

(

d) Savings portions of life insurance contracts means that portion of life insurance contracts determined in the prescribed manner.

Mr. Renwick: Mr. Chairman, this is obviously the amendment to which the Treasurer (Mr. McKeough) referred when he made a statement in the House on Apri