LEGISLATIVE ASSEMBLY OF MANITOBA Thursday, 8 May, 1980 Time - 2:00 p.m. OPENING PRAYER by Mr. Speaker. MR. SPEAKER, Hon. Harry E. Graham (B ir tle­ Russell): Presenting Petitions . . . Reading and Receivi ng Petitions . . . Presenting Reports by Standing and Special Comm ittees . . . Min isterial Statements and Tabling of Reports ... Notices of Motion ... Introduction of Bills. At this time, I would like to draw the honourable members' attention to the gallery on my right where we have 40 students of Grade 11 standing from the Neelin High School.

This school is located in the constituency of the Honour able Member for Brandon East. On behalf of all the hono urable members, we welcome you here this afternoon. ORAL QUESTIONS MR. SPEAKER: The Hon ourable Leader of the Opposition. MR. HOWARD PAWLEY (Selkirk): Mr. Speaker, my question is to the First Minister, to respond in the absence of the Mini ster of Finance. Can the First Minister confirm that the increase in federal sales tax pertaining to liquor in the mini-budget will reap in a greater return for the provincial treasury in Manitoba than moneys that will flow from Manitoba to the federal treasury. MR.

SPEAKER: The Honou rable First Minister. HON. STERLING R. LYON (Charleswood): Mr. Speaker, I will be happy to take that as notice for the Minister of Finance and get my honour able friend the correct information on that topic. MR. PAWLEY: Mr.

Speaker, based up on information that the tax in fact will reap in some additional millio ns of dol lars to the provincial Treasury by way of in creased markup by the Manitoba Liquor Control Commission, and by way of additional sales tax, does the First Minis ter still concur with the statement that was issued by his Minister of Finance at the time of the introduction of this tax and the mini-budget, that in fact it was regrettable and that it was an intrusion in to provincial taxing powers? MR. L VON: Mr.

Speaker, again, I would be happy to have the Min ister of Fina nce respond to my honourable friend's question. MR. SPEAKER: The Honour able Member for Fort Rouge. MRS. JUNE WESTBURY: Thank you, Mr. Speaker. My question is addressed to the First Min ister, in the absence of the Ho nour able Minis ter of Natural Resources.

In view of the report to the effect that the Manitob a Act ion Comm ittee on the Garrison Diversion, in their visit to Washington, found that there was a considerable lack of knowledge on the part of congressmen about Canada's concerns on the diversion, will Manitoba become more actively inv olved in the lobbyin g in Wa sh ing ton , and specifically, will they be sending a strong contingent to the summer hearings on the Garrison Diversion? MR. SPEAKER: The Honour able First Minister. MR. LYON: Mr.

Speaker, I'll take that as notice for the Min ister of Resources, who is attending a Minis terial meeting out of the province. I could only say by way of partial answer to the Member for Fort Rouge, Mr.

Speaker, that the traditional method by which governments, plural, of Manitoba have dealt in the most effective way with Garrison - and I'm sure there is universal accord in the House on the firm position of the previous administration and of this administration that none of the waste paper from Garrison should enter the water systems of Manitoba - we have found that the most effective means of getting that message through has been to work in close cons ultation and co-operation with the Government of Canada, particularly through the Department of External Affairs who, in turn, are working with the State Department of the United States, the executive branch of government in turn being in touch with the elected branch.

But that would not, of course, preclude in any way the Government of Manitoba, in concert with the federal government, taking action of the kind that has been suggested by the Member for Fort Rouge, or any other action that would be deemed to be helpful in ass uring that the decision and the determination that was made by the International Joint Comm issi on, namely that water from that development should not enter into the water drainage systems in Canada, to ensure that is carried out and given full effect by the Congress of the United Stated.

We will take, in conc ert with the federal gov ernment, whatever action is deemed to be appropriate to further that cause. MR. SPEAKER: The Hono urable Member for Fort Rouge. MRS. WESTBURY: I thank the First Min ister for his reply. My next question is add ressed to the Honourable Minister of Government Services. I want to thank him for the Return to Order of the House Number 2. However, the answer leads to one further question. It was stated in the reply that the tendering was advertised in two local papers. Would the Honour able Min ister advise us which two local papers? MR.

SPEAKER: The Hon ourable Mi nis ter of Government Services. HON. HARRY J. ENNS (Lakeside): Mr. Speaker, the Winnip eg Free Press and the Winnip eg Tribune. 3399

Thursday, 8 May, 1980 MR. SPEAKER: The Hono ur able Mi nis ter of Labour. HON. KEN MacMASTER (Thompson): Mr . Speaker, I would like to further answer, if you would, the question posed to me by the Leader of the Opposition yesterday as to the number of layoffs and if I had had appropriate notification. The situation has changed somewhat and we now have some of our department people involved with the company because there appears to be some consideration of them thinking of putting another product in line, in lieu of what they have been doing.

That, of course, would affect the number of emplo yees involved, which of cou rse would back up and affect the appropria te no tifica tion. I would li ke to give assurances to the Leader of the Opposition that once we have all that in place, that appropriate notification will be given to the at that time determined number of people, which is un kn own to myself at this moment. MR. SPEAKER: The Hon ourable Leader of the Opposition. MR. PAWLEY: Mr. Speaker, I wish to thank the Min ister responsible for Man power.

I would ask the Minis ter of Man power if, indeed, in the discussions between his department officials and the company in question, whether reasons were given as to the basis for the layoffs. If so, could the Minister indicate those reasons? MR. MacMASTER: Yes, Mr. Speaker, we understand that there is an excess of 2 million worth of inventory that is not moving. I understand also that the industry itself, this is travel trailers and that type of thing, that that industry is at a bit of a slow point in moving the produc t at this time.

The company, I also understand, is certainly hopeful that business will pick up, but they do have a large amount of inventory in hand that is not moving and it's felt that they should lay off some people at this time. I also un derstand other produc ers of simil ar products in Manitoba have laid off in the last several months, going back approxima tely a year. It's because of a slowdown in the sales of the product. MR. PAWLEY: Mr. Sp eaker, then a further supplementary to the Min ister.

As a result of his response, it gives rise to a question leading from a report today by the President of the Recreation Vehicles Association, Dealers Association, one Mr. Glen Sampson, to the effect that recreation vehicle dealers expected sales of conventional trailers to drop, but Mr. Sampson indicated that sales have been maintained and in fact, in some instances, have been increased, not as the Min ister just indicated, that there has been a slump in the industry.

Can the Minister then advise the source of his information, in view of the fact that his information is four-square in opposition to the report from the President of the Motor Vehicle Recreation Association of the province of Manitoba? MR. MacMASTER: I'm pleased that we have a head of an association saying that sales are up, but the facts of the matter are, this particular industry and the company that we're dealing with here is producing what I un derstand to be qu ite an elaborate type of trailer, and the facts are that they have over 2 million worth of inventory on the lot that is not moving.

I'm not going to dig into their businesses, why their particular product is not being sold. Maybe the less elaborate ones are moving, in fact, but this one quite obviously isn't, Mr. Speaker. MR. PAWLEY: By way of supplementary, is the Mi nister indicating that the situation pertaining to Edson is indeed an isolated situation and not one that is applicable to the industry as a whole, as implied by the statement of Mr. Glen Sampson? MR. MacMASTER: This is the only major concern industry in that field that has been brought to my attention.

It's been heresay that others have not had the sales that they expected, but this one, very obviously, from the facts that I have gathered, has had very little sales. So I guess maybe that's isolated as far as the type of specific product this company is producing is concerned. MR. SPEAKER: The Hono urable Me mber for Brandon East. MR. LEONARD S. EVANS: Thank you, Mr. Speaker. I, too, would like to address a question to the Honour able Min ister of Labour, who I know is very concerned about the welfare of the working man, and the wages the work ing people earn.

Statistics Canada has now issued information on average weekly earn ings by indus tries and by provinces, and it indicates that while there has been some increase in wages in Manitoba, the past year, February 1980 over February 1979, it shows that Manitoba's wage increase is falling behind that of the rest of Canada, and certainly behind Saskatchewan and Alberta. My qu estion is, if our economic situation is so favourable in Manitoba at the present time, why is our wage rate increase falling behind that of most of Canada? MR. SPEAKER: The Honour able Mi nis ter of Labour. MR. MacMASTER: Mr.

Speaker, I have belonged to trade labour movements in several provinces in this country, and I think some of the leadership - if other members want to ask questions, maybe they should get up, I'll attempt to be courteous enough to answer the question that was posed to me. After belonging to unio ns across this country, I can honestly say that the labour leaders in the province of Manitoba are as good as, if not better than some others that I've witnessed across this country at negotiating contracts.

I think that it's probably best to be left to them and the indus tries at the negotiating table, the types of contracts and the fringe benefits and the conditions of employment that they negotiate. I don't intend to impose my will as an individual, or the Department of Labour's into the negotiating table as to the types of settlements that are reached in the province of Manitoba. 3400

Thursday, 8 May, 1980 MR. EVANS: Mr. Speaker, I do not share the Honourable Minister's views in pointing a finger at the unions, Mr. Speaker ... MR. SPEAKER: Order please. Whether or not the member shares the views of the Min ister really isn't of significance in the question period. The Honourable Member for Brandon East with a question? MR. EVANS: While not accepting the analysis and conclusions of the Honourable Mini ster, I would ask him then, inasmuch as probably less than one-third of the labour force is organ ized and

whereas these figures apply to the total labour force, including that two-thirds which is not organized, and inasmuch as the average wage rate now in Manitoba is only 89 percent of the Canadian average, the average weekly wage for all industries, 83 percent of Alberta and only 94 percent of Saskatchewan, can the Min ister explain now, inasmuch as most of the workers are not in the union sector, can he offer any explanation why our wage rate increases continue to fall behind those of the rest of Canada? MR. MacMASTER: Mr.

Speaker, it's not a secret that wage rates in unorganized areas of our society tend to follow the organized rates. It's been said many times, and I've said it myself, when in fact I was in the business of being a union organizer, that it sort of disturbed us sometimes that there was a large number of companies around that we were having difficulty organizing, because lo and behold, they paid similar rates and gave similar benefits, and in some cases, better, just to keep the unions out. So the unions in fact, are the ones in Manitoba that are setting the rate.

And again, I go back to what I said before, we have some pretty good ones, pretty good union negotiators on the labour side in Manitoba, and I leave it to t.hem to negotiate the contracts. MR. SPEAKER: The Ho nour able Member for Brandon East with a final supplementary. MR. EVANS: Thank you, Mr. Speaker. I would like to ask the Minister then, why is it that we happen to have the lowest average weekly wage in Canada west of Nova Scotia. I believe only Prince Edward Island and Nova Scotia have lower average weekly wages than we do in the province of Manitoba.

Does the Minis ter have any explanation for this particular unfavourable phenomenon? I would like to suggest that it's the lack of economic opportunities in this province, but the Honourable Minis ter said that there are a lot of economic opportunities. I wonder if the Honourable Minis ter could comment on why we have the lowest average weekly wage for industries in Canada outside of Nova Scotia and, I believe, Prince Edward Island, and this is for the latest period available, February 1980? MR. SPEAKER: The Ho nourable Minis ter of Labour. MR.

MacMASTER: I'm not sure whether the Mem ber for Brandon East should go to the convention that's being held in Winnipeg here and tell them in fact tha t the un ion negotiators in Manitoba are doing a poor job. I don't happen to believe that they are doing a good job, and for his information when union negotiators go to the table they are armed with the facts as it relates to their particular situation and what they feel is desirable for thems elves and their memberships. Again, Mr.

Speaker, I leave that to them to arm themselves with the appropria te information and to the best they can at the negotiating table, which they are capable of doing. MR. SPEAKER: The Honourable Member for Flin Flon. MR. THOMAS BARROW: Thank you, Mr. Speaker. I'd like to address a question to the Min ister of Government Services. As the Min ister is well aware, TV satellite broadcasting is coming in strong in the north and my question - he is also aware that it's quite controversial who owns what. But my question to the Minister is this, is this type of broadcasting legal or illegal, satellite broadcasting. MR.

SPEAKER: Order, order please. I don't think it's quite proper for a member to ask another member on the legal opinion of what is legal and what is not legal. MR. BARROW: Another question, Mr. Speaker, has the Minis ter received a legal opinion on this matter? MR. SPEAKER: The Ho nour able Min ister of Government Services. MR. ENNS: Mr. Speaker, I can only indicate to the Honourable Member for Flin Flon that there are currently hearings under way in Ottawa.

The CRTC that are dealing with this very issue, the installation of earth receiving stations, satellites, and the picking up of signals from American satellites or the two Canadian satellites that are up there are, I am told, technically in breach of the regulations as they now stand. However, I'm also advised that the number of these types of receiving stations are increasing rapidly, that there are over some 3 - 400 of them in place, particularly throughout northern Manitoba, and the federal officials in concert with provincial officials are addressing themselves to this growing problem. MR.

SPEAKER: The Honourable Member for Flin Flon. MR. BARROW: While I'm on my feet, Mr. Speaker, I'd like to address a question to the Min ister of Highways or Transport, if he would just listen to me for a moment. My question to the Min ister of Transport - I don't know if he knows or doesn't know that the Hudson Bay Mining and Smelting have done away with all CNR travel concerning their ore. It's now being trucked from as far north or east as Flin Flon. What is happening, Mr. Speaker, is it's really making a mess of our government road system.

My question to the Minister is, would he consider a special tax on these trucks to help maintain these roads? Thank you. MR. SPEAKER: The Ho nour able Min ister of Hig hways. 3401

Thursday, 8 May, 1980 HON. DON ORCHARD (Pembina): Mr. Speaker, that's an in terest ing conc ept and qu ite a presentat ion, because the firms undergoing the hauling of that commodity will be paying full licencing costs to the province of Manitoba and they will be paying full fuel taxes to the province of Manitoba, and what the Member for Flin Flon is suggesting that we add additional taxes to them when they are operating on the highways with all the rights and privileges that they have paid for. MR. SPEAKER: The Honourable Member for St. Boniface. MR. LAURENT L. DESJARDINS: Mr.

Speaker, my question is to the Minister of Education. In view of the fact that the Seine School Division unanimously voted in favor of construction of a French School in the area, and in view of the fact that it's certainly with the intent of the legislation on French education, could the Minis ter meet with the parents' committee, with this group, once and for all to try to settle this situation, Mr. Speaker. MR: SPEAKER: The Ho nour able Min ister of Education. HON. KEITH A. COSENS (Gimli): Mr. Speaker, I can tell the member that I'm quite prepared to meet with any interested group from that area. MR.

DESJARDINS: Mr. Speaker, then I've been requested to try to arrange this meeting with the Minister so that the Mini ster can give me a date once he's checked his calendar, and would he extend me the courtesy of an invitation to that meeting also. MR. COSENS: Yes, Mr. Speaker. MR. SPEAKER: The Honourable Member for St. George. MR. BILLIE URUSKI: Thank you, Mr.

Speaker, I direct this question to the Minis ter of Agriculture, and ask him if he can give to this House whatever information he has on what contingency plans he and his department have, in view of the possible serious outbreak of grasshoppers within the province of Manitoba. MR. SPEAKER: The Ho nourable Mini ster of Agriculture. HON. JAMES E. DOWNEY (Arthur): Mr.

Speaker, the question the member raises is one of importance to the farm community, and I would say that the department have identified the stocks of chemical that would be necessary to help control the grasshoppers that may be of some threat, but at this particular time it's too early to estimate the danger which they may incur to the crops that haven't started to grow yet. MR. URUSKI: Thank you, Mr. Speaker. I hope that there will be adequate stocks of the approp riate chemical available, as the Minis ter has given us that assurance.

I would ask the Min ister as well, could he advise this House on the amount of money that Manitoba farmers have lost as a result of selling their feed grains on the open market system for use within Canada? Could he give us the amount of money that Manitoba producers have lost over the last several years? MR. DOWNEY: Mr. Speaker, I think it would be unfair for me to try and make an estimate at this particu lar time, how much farmers would have gained by marketing through the open system or through the Wheat Board system.

I guess the point that has to be made is, that the fact of the matter is that farmers have sold their grain, they have created a cash flow, and are not faced in a lot of cases with high interest rates on operating loans that they'd have to otherwise face without having sold that grain. There are many elements that have to be brought into light to totally get an estimate of whether they're ahead or behind the normal situation. MR. URUSKI: Thank you, Mr. Speaker.

I wonder if the Minister could confirm that the farmers within Manitoba alone within the last three years have lost in excess of 30 million by selling their feed grains on the open market rather than through the Canadian Wheat Board on the corn competitive price that was set by the federal government out of Chicago? MR. SPEAKER: The Ho nour able Mi nister of Agriculture. MR. DOWNEY: Mr. Speaker, as the member has indicated, it is a federal policy that ties the price of domestic feed grain to the corn competitive price in eastern Canada.

However, being a man who feeds grain himself, I guess he has the freedom to either feed livestock in Manitoba or in any part of Canada, and the more alternatives that he has, I think the better position that he is in as a producer in Manitoba, so I think that we have to retain that opportunity of multiple system of markets for the producers in Manitoba. MR. SPEAKER: The Honourable Member for Rock Lake. MR. HENRY EINARSON: Mr. Speaker, I direct this question to the Minis ter of Agriculture.

My question pertains to the Port of Churchill and I would like to ask the Min ister if he can indicate how much grain and what type of grain are in storage in the elevators at the Port of Churchill at the present time? MR. SPEAKER: The Ho nour able Minis ter of Agriculture. MR. DOWNEY: Mr. Speaker, for the information of the Member for Rock Lake, the information that I have at this particular time is that there are few stocks of grain, both barley or wheat, at the shipping point of Churchill at this particular time, however.

I have been assured, as we as a government have been assu red, tha t the gr ain transporta tion coordinator has given us the assurance that they will put sufficient stocks in Churchill to fully utilize that particular port. I think we all have to be aware that the shipping season doesn't start until July and will be encouraging the workers and the people 3402

Thursday, 8 May, 1980 responsible for moving grain into that port, that they do so, so that we can use the facilities to the best of their ability. MR. EINARSON: Mr. Speaker, a supp lementary question and the Minis ter may have given a partial answer, but I would like to ask the Min ister if he could indicate who has in the past year and is now responsible for seeing to it that grains are delivered to the elevators in Churchill? MR. DOWNEY: Mr. Speaker, the Canadian Wheat Board have had the responsiblity of allocating the stocks to the Port of Churchill for the past several years. MR.

SPEAKER: The Honourable Member for St. George. MR. URUSKI: Thank you, Mr. Speaker. A question to the Minister of Agriculture, I wonder if the Min ister of Agriculture can indicate that there has been excessive profit-taking in terms of feed grain sales within this country as a result of not having the feed grain prices set on the corn competitive system as it has been for the Wheat Board. MR. SPEAKER: The Ho nour able Mi nis ter of Agriculture. MR. DOWNEY: Mr.

Speaker, the member asks about profit for feed grain and I think that the main concern that I have is that profit goes to the farmers of this province. · MR. URUSKI: Thank you, Mr. Speaker. Then if the Minister is concerned that the profits be given to the farmers, and I share his concern, what actions does the Minis ter propose to take in view of the fact that excessive profit taking has been in effect in the feed grain sales in terms of - by the grain trade that will purchase the feed grain sales. MR. SPEAKER: Order, order please.

I sense a debate taking place on Agriculture and I then would advise that Agriculture is before the Committee at the present time, and I thin k if the honourable member wants to wait for 20 minu tes he could probably carry on his debate there. The Honourable Minis ter of Government Services. MR. ENNS: Mr. Speaker, yesterday the Honourable Memb er for The Pas raised the matter of the construction at the Correctional Institute at The Pas and the Court House, and suggested that there were some serious problems encountered, particularly with the concrete and foundation work.

My office contacted the consulting engi neers immediately upon the matter being raised in the House and I want to assure the honourable members that construction is proceeding as scheduled, indeed ahead of

schedule at The Pas, with no problems being encount ered at all. I am sure that nothing other than the normal and usual shrinkage cracks are appearing in some of the foundation work. The consulting engineers assured me that this is to be expected. There was a small area that suffered some frost damage during the laying of the concrete; that has been planed down and remedied. Again, it is a normal problem that is encountered, particularly when construction is undertaken in the winter time in this province. I can assure the honourable members of the House and particularly the Member for The Pas that construction of these two facilities are on

schedule and proceeding well. MR. SPEAKER: The Ho nour able Mem ber for Wellington. MR. BRIAN CORRIN: Mr. Speaker, my question is for the Honourable Attorney-General. Mr.

Speaker, now that the city of Winn ipeg Council has renewed its call for a clear-cut conflict of interest guidelines in legislation, we were wondering whether or not the Attorney-General, in his capacity as a Mini ster responsibile for Urban Affairs for the province, will be giving heed to that request, and whether or not he will now be implementing the recommendations made in the Rhode s-S mith Confl ict of In terest Commission Report tabled with his office in 1978? MR. SPEAKER: The Honourable Attorney-General. HON. GERALD W.J. MERCIER (Osborne): Mr.

Speaker, I understand the resolution passed by city of Winnip eg Council last night refers to The Ontario Munic ipal Conflict of Interest Act, which I understand from my officials has some pr oblems and amendments are being contemplated in the province of Ontario to that particular piece of legislation. In view of the further facts, Mr. Speaker, that council does refer to a Conflict of Interest Act that would apply to all muni cipal councillors in the province of Manitoba, both rural and urban, and that there are different problems at those two levels, and further, Mr.

Speaker, in view of the fact tha t legislative counsel at the present time have a very heavy workload and would be unable to attend to this matter for some period of time. Further, in view of the additional fact, Mr. Speaker, that the previous government at one point introduced a Conflict of Interest Act into this Legislature and withdrew that Bill, I decided that I will refer this matter to the Law Reform Commission to review not only the proposal from the City of Winnipeg, but legislation that exists in other provinces and deals with this matter in a variety of ways, with the hope, Mr.

Speaker, that they will consult with, not only the city of Winni peg Council, but with municipal councillors throughout the province and in reviewing other legislation will make recommendations to us for consideration by this Legislature. MR. CORRIN: Mr. Speaker, my question is for the same Min ister, and is with respect to rail relocation. Mr.

Speaker, with respect to the fact that the federal government has now indicated that they may be able to channel OREE funds in the approxi mate sum of 25 million for the purpos es of rail relocation in Winnipeg, and given that the City of Winnip eg has committed a like amount of funding towards the project, we would ask whether the members opposite in the government can ind icate if they will be providing a like sum of money, minimally a like sum of money to the two other jurisdictions? 3403

Thursday, 8 May, 1980 MR. SPEAKER: The Honourable Minis ter of Urban Affairs. MR. MERCIER: Mr. Speaker, if in fact that offer has been made, I indicated yesterday to the news media who asked me, I believe Mayor Norrie has also indicated that 25 million, while it certainly is a large amount of money, does not meet the test of a significant federal financial contribution towards rail relocation. I have no official word from Mr . Pepin, who undertook to advise myself and the Mayor when he had comple ted his task of enquiring into other possible areas of funding.

I believe that he has indicated to the Mayor that he hopes to respond to him and give him a formal reply by the end of May. I think, Mr. Speaker, we'll simply have to await some official response from Mr. Pepin before we're able to proceed any further with respect to this matter. MR. SPEAKER: The Ho nour able Me mber for Wellington with a final supplementary. MR. CORRIN: Mr . Speaker, in noting that the honourable members opposite are now the only party who have not made a representation or commitment in this regard, and it's an important matter, I would once again, Mr.

Speaker, and I don't wish to be repetitive or redundant, I would once again ask the Honourable Min ister whether he can ind icate, whether he will in deed match the commitment of the city of Winnip eg; and if it is forthcoming, the seemingly equivalent contribution of the federal government, is he willing to give us the assurance that he will, in fairness, minimally match those other two comm itments? Because, Mr.

Speaker, if he is unwilling to do that, I would suggest respectfully to you that there is no purpose to this matter being further negotiated and our federal fri end, foe to some, but friend to others, Mr . Axworthy, may indeed be right, that there can be no proceeding on rail relocation in the absence of this gov ernment 's commit ment and willi ngness to negotiate. MR. MERCIER: Mr. Speaker, the only commitment by the city of Winnip eg is to share one-third of the total cost with the province of Manitoba, with two­ thirds of the cost being paid for by the federal government.

The only indication of any financing is apparently, as I read in the media, a statement from Mr. DeBane, the OREE Minister, that 25 million may be available over a period of five years. So there simply has not been any sig nificant federal commitment towards this project, as was indicated by the federal Minis ter from Manitoba and the now Prime Min ister of Canada , when they were campaigning during the federal election. Mr. Speaker, on another matter, I undertook to respond to a question from the Mem ber for St.

Johns with respect to two publications which recently were on the book shelves in Manitoba, The Joy of Gay Sex and The Joy of Lesbian Sex. Mr. Speaker, as a result of a public complaint, the Crown office at the Public Safety Building reviewed these books and concluded that on the basis of their content and the provisions of the Crimi nal Code prohibitin g the publication of obscene matter and court decisions, that the publications were probably obscene and could be the subject of prosecution.

As Classic Books Shops and Coles, the book people, were not previously the subject of complaint in respect to publications sold by them, it was decided that the Winni peg police should advise these commercial outlets of the Crown's opinion to determine whether they were prepared to voluntarily withdraw the books from publication. It is emphasized, Mr. Speaker, that contrary to some statements in this matter, the Crown was not attempting to act as censors of publications for sale.

These outlets were given the opportunity to decide whether to discontinue the sales or continue publication and distribution in face of prosecution. These commercial outlets decided to voluntarily withdraw the books from circulation. Apparently, Mr . Speaker, Mr. Walter Stein, a professor at the University of Winnip eg, decided to purchase surreptitiously, copies of each book from Classic Book Shops on May 2, 1980, from a clerk, without apparently, the knowledge or consent of the management.

He thereupon attended at the Public Safety Building, advised that he had purchased the books from Classic Book Shops, and registered his complaint. As in the case of complaints made by any citizen, the city of Winnip eg police conduc ted a further in vestigation in to this alleged sale to Professor Stein. At this time, there were no copies of either book found available for sale at Classic Book Shops, and attempts by police investigators to purchase the books were unsuccessful. The police reaffirmed from the book store that the books were no longer available for sale.

Accordingly, except for the obtaining of the books from an employee by Professor Stein, it appears that the books are not being sold by Classic Book Shops, and there remains no basis for a prosecution of the proprietor or occupier, except the particular sale made to Professor Stein by an employee, which was neither approved nor authorized by the proprietor. It is apparent from public statements of the professor that his action was contrived to bring about a prosecution against Classic Book Shops, a compa ny which had elected to withd raw the publication rather than deal with a prosecution.

There is no evidence that the . . . MR. SPEAKER: Order please. I hope the honourable member is very close to the end of his statement. It is a rather lengthy explanation of a question. The Honourable Attorney-General. MR. MERCIER: I'm very close, Mr. Speaker. There is no evidence, Mr. Speaker, that Professor Stein has a genuine concern as a complainant that these publications offend him.

It would appear that he seeks a prosecution against a third party which could lead to costs and possibly conviction, but a third party has clearly indicated it's not to be the desire of the third party, who had been prepared to remove the books from the shelves. It would appear that in many respects, Professor Stein has int erfered because of his disagreement with the decision made by Classic Book Shops and would not, of course, have any respo nsibility for the costs or result of the prosecution of a third party. 3404

Thursday, 8 May, 1980 In the circumstances, the Crown has decided that Professor Stein's complaint does not afford a proper basis for prosecution of Classic Book Shops. It is, Mr. Speaker, made clear, however, tha t in appropria te circumsta nces, the Crown is still prepared to consider prosecution of any further publication. Thank you, Mr. Speaker. MR. SPEAKER: Order please. The Honourable Member for Kildonan. MR.

PETER FOX: On a point of order, in view of the fact that the Honourable Attorney-General had six pages he was reading from, I wonder if the Leader of the Opposition can have equal time to reply to that statement? MR. SPEAKER: Order please. I find the point of order raised by the Ho nour able Member for Kildonan, while it is a genuine concern that we have lengthy detailed answers given during question period, it is a concern to me. I would hope that members, in answering questions, are short and to the point, and I hope that the questions are also short and to the point. The Honourable Attorney-General. MR.

MERCIER: On the same point of order, Mr. Speaker, the questions, I note, are at least a full page long from the Member for St. Johns. They were detailed questions and there were only two pages of an answer that I read to the House, and I suggest under the circums tances of the question, it had to be dealt with in that detail. MR. SPEAKER: The Ho nourable Mi nister of Finance. HON. DONALD W. CRAIK (Riel): Mr. Speaker, I was asked a question earlier this week from the Leader of the Opposition with regard to the timing of the Budget.

I'd like to advise the House that barring unforeseen circumstances, that the Budget is now scheduled for next Tuesday evening at 8:00 p.m., May 13th. MR. SPEAKER: The Honourable Leader of the Opposition. MR. PAWLEY: Mr. Speaker, I thank the Min ister for that information. It's an unlucky day, May 13th, for the government. Mr. Speaker, in the absence of the Minis ter of Finance, the First Min ister accepted a question as notice for the Min ister, probably the Minis ter now could respond.

Can the Min ister confirm that the federal tax which he criticized as having been levied by the federal government pertaining to liquor, wine and imported beer, in fact will result in a greater return to his Treasury in the province of Manitoba, than by way of tax flow from Manitoba to the federal Treasury? MR. CRAIK: Mr. Speaker, I will have to take that question as notice. MR. SPEAKER: The Ho nour able Memb er for Elmwood. MR. RUSSELL DOERN: Mr.

Speaker, I want to direct a question to the Minis ter of Urban Affairs concerning rail relocation, and ask him whether in previous years, given his experience on council and to the present, whether it was the sum of money necessary for rail relocation that prevented the federal government from supporting the concept. MR. SPEAKER: Order please. It is highly improper for a member to ask a Min ister to make a comment on an office that he is not presently holding. I have to rule the question out of order. The Honourable Member for Elmwood. MR. DOERN: Mr.

Speaker, maybe I can re-word it, and simply ask the Mi nister whether the federal government's refusal in previous years, and I am thinking particularly of February, 1979, was based on a particular figure set for rail relocation. MR. SPEAKER: The Honourable Min ister of Urban Affairs. MR. MERCIER: Mr.

Speaker, the decision by the federal government in February of 1979 was with respect to the application by the city of Wnni peg and the province of Ma ni toba to proceed with construction of the Sherbrook-McGr egor Overpass, and the decision by the federal Minister not to allow that to proceed was not, to my knowledge, in any way based on lack of funds. MR. SPEAKER: Order pl ease. The time for Question Period having expired, we will proceed with Orders of the Day. ORDERS OF THE DAY ORDER FOR RETURN MR. SPEAKER: The Ho nour able Me mber for Kildonan. MR. FOX: Mr.

Speaker, I move, seconded by the Honourable Member for St. George, that an Order of the House do issue for a Return of the following information: Payments to provincial empl oyees for use of private or leased automobiles in the performance of duties tabulated by the department for the following periods: April 1, 1976 - March 31, 1977 April 1, 1977 - March 31, 1978 April 1, 1978 - March 31, 1979 April 1, 1979 - March 31, 1980 MOTION presented. MR. SPEAKER: The Ho nour able Mini ster of Government Services. MR. ENNS: Mr. Speaker, we have no difficulty in accepting this Order. · MR.

SPEAKER: I declare the motion carried. The Honourable Member for Kildonan. MR. FOX: Mr. Speaker, I move, seconded by the Honourable Member for St. Vital, that an Order for 3405

Thursday, 8 May, 1980 the House do issue for a Return of the following information: The number of flights within Manitoba by (

a) Cabi net Mi n isters and (

b) provincial employees tabulated by the department for fiscal years ending March 31, 1977, 197 8, 1979 and 1980 shown by (1) chartered or for hire aircraft

(2) Man itoba Government Air Division. MOTION presented. MR. SPEAKER: The Ho nour able Minis ter of Hig hways. MR. ORCHARD: Yes, Mr. Speaker. MR. SPEAKER: I declare the motion carried. The Honourable Government House Leader. BUSINESS OF THE HOUSE - COMM ITTEES MR. MERCIER: Mr. Speaker, firstly, I might advise members that the Public Utilities Comm ittee will continue to meet next Tuesday at 10:00 a.m., and Thursday at 10:00 a.m., if necessary.

If they do conclude, as I expect they will on Tuesday, we will attempt to make arrangements for the Committee on Economic Development to meet on Thursday, but I will have to confirm that later, Mr. Speaker. Mr. Speaker, I move, seconded by the Min ister for Government Services, that Mr. Speaker do now leave the Chair and the Hous e resolve itself into a committee to consider of the supply to be granted to Her Majesty.

MOTION presented and carried, and the House resolved itself into a Committee of Supply with the Honourable Member for Radisson in the Chair for Com muni ty Services and Corrections, and the Honourable Member for Emerson in the Chair for Agriculture. CONCURRENT COMMI TTEES OF SUPPLY SUPPLY - AGRICULTURE MR. DEPUTY CHAIRMAN, Albert Driedger (Emerson): Committee come to order. Resolution 6.(1)(b) - the Member for Ste. Rose. MR. A. R. (Pete) ADAM: I don't have too much more to say on this particular item. I know that the Member for St. George will be in in a few minutes.

When we broke off yesterday, the Minis ter made comments in regard to a meeting that we had at Glenella with produc ers in that area. There were producers from pretty all the Parkland area, right up to Meadow Portage, Waterhen, and so on. The meeting, of course, was a delayed meeting, it came probably a month or two after the ranchers had been in touch with the Minister's office to try and meet with him on the cost formula. I think the main problem that the ranchers were expressing was that they didn't fully understand the formula and there was some question as to whether it was high enough and so on.

That was the main concern at the meeting. The Minis ter says that I did not have the intestinal fortitude to get up at the meeting. First of all I want to say that I was not invited to the meeting by the Min ister. I came as an observer and as a representativ e for that area, and as a rancher, myself, and I sat with the ranchers and I was invited to sit at the front. I didn't feel that it was my meeting and tha t I should be in volved.

We're not in government, it's the government of the day that has to administer the affairs of government, so it wasn't my meeting and I didn't feel that I should be interfering with the Mi n ister's meeting. (Interjection)- Well, the thing was, we could have gone up there and had a good confrontation, that's probably what would have happened. I think it turned out to be a fairly good meeting. I know that the ranchers wanted to speak of other matters besides the beef program, but the meeting was cut down pretty short. They wanted to start asking other questions on leases and so on, and the meeting was cut short.

One of the major problems facing the beef industry at the present time is really what came out in the question period today, and that is the feed grain policy in Canada, which is really assisting eastern Canada beef producers rather than the west, and I think that's something tha t the Mi nister should be looking at in regard to the problems that our feed grain policy is causing, not only to grain producers, but also the beef industry in western Canada.

We are being sh afted by that program, and we have information now available to us that is quite startling, and I know that some of the members, the Member for Gladstone was saying, the quotas are too small, where are the quotas, what are the farmers going to do? But the fact of the matter is that the Ontario produc ers are now, barley produc ers are now exporting barley, and they're selling their barley on the export market and getting a good price for it and western Canada farmers are sending their non-board barley at depressed prices down east, and they're buying our barley and reselling over there.

They are exporting their barley, and they're buying our barley at depr essed prices. Tha t is the problem, Mr. Chairman, with the feed grain policy that we have in place in Canada at the present time.

I know that getting back to the beef income assurance program, I know that one of the ag reps, I think he was an ag rep at that time, although I don't think he is now, and that was Ken Waddell, he was at the meeting, and he thought that the formula that is being used to arrive at a cost of production, the formula was satisfactory, but he did not think the way it's figured out, the formula was okay but each individual cost wasn't accurate, and somehow it had gone out of whack over the years. It might have been all right in the beginning.

For instance, there's been some information, I don't have that information, but I know the Member for St. George has some of that information that has been coming out on the cost of productions, costs that are not really taken in as far as the formula is concerned, so maybe there should be some adjustments in there, because I know that myself, my own operation, I figure that I have to receive 85 cents a pound for finished beef to break even. That is what it costs me now, and I'm sure it costs any rancher the same thing. Mr. Chairman, that was my 3406

Thursday, 8 May, 1980 cost this year for producing beef. You can't get that for them. We got a good price, to be quite frank with you, we got 78 cents a pound for our beef, which was good. -(In terjection)- Well, it's off the finished beef, and the best you can get. Top beef, top price. Probably we got a cent or two above the market price and to break even, we would have had to have about 85 cents a pound. MR. DEP UTY CH AIRMAN: pass - the Member for Lac du Bonnet. MR. SAM USKIW: Mr.

Chairman, yesterday, we were into a fair amount of discussion on the beef income assurance plan, and I was trying to complete that discussion with a request for some information from the Min ister. What I would like to know is, what were the total dollars that were spent on that program over the years to date, and then what were the total dollars recovered from those who have volunteered a payback, and then what is the amount that is outstanding in the Min ister's mind, pursuant to his policy, as to the payback that is still to be received by his department? MR. DOWNEY: Mr.

Chairman, the total paid out since the introduction of the program was 41, 213,8 23, that was the total payout under the Beef Income Assurance Program. MR. DEPUTY CHAIRMAN: Pass - the Member for Lac du Bonnet. MR. USKIW: Mr. Chairman, I asked the Minister th ree questions, he answered one. The second qu estion is, how much money did he receive pursuant to his policy of asking for some of that money to be repaid, based on the gua ranteed formula? MR. DOWNEY: The amount that has been collected to this particular date, Mr. Chairman, is 1, 311 ,248 - these are appr oximate figures, Mr.

Chairman - and the balance that is still owing, that is being billed for, is 1,21 4,996.00. The numbers of contract payers tha t ha ve paid back, on a percentage basis, there is over 60 percent of the farmers have accepted the payback or have paid back their contracts with the dollar amount being just over 50 percent of the dollars recovered. MR. USKIW: Mr. Chairman, what was the figure last year or at the end of 1979 as far as the payback is concerned? How much money came in in 1980? MR. DOWNEY: These would be the total numbers, Mr. Chairman, on a payback basis. I don't know what else the member is asking.

I ind icated, I believe, the last time I was questioned on this, I suggested that the position we have taken, as it has been been released in the press releases, is that they would be requested or required to pay back their 1978 billings, which were billed in 1979, and those are the totals that I have provided for. MR. USKIW: Mr. Chairman, when did the Minister first request a payback for 1978? MR. DOWNEY: The payback on the funds was made in July of 1979, was the first ... MR. DEPUTY CHAIRMAN: The Member for Lac du Bonnet. MR. USKIW: Mr.

Chairman, what I want to really know is how much of that money, of the 1. 3 million, came in prior to the later policy statement of the government outlining a position where the government is prepared to allow people to opt out of the plan if they pay up their accounts? Wha t part of that 1.3 million was already paid up before that policy annou ncement, which is up to April 3 of this year? MR. DOWNEY: If I un derstand the qu estion correctly, he is asking the question, how much money was paid up to that particular point, which would be July of 1979 . . . MR. USKIW: No, up to April of 1980. MR.

DOWNEY: It would be in appropria tely the same range, I would believe, as the figure I had given him, somewhat a little bit less, but I would at this particular time think it is in excess of 1 million, but not the 1.3 million that I indicated was paid to this particular time. So, in excess of 1 million. MR. USKIW: Mr. Chairman, what the Minis ter is telling the committee is that most of the money that he has collected, he collected before his new policy of allowing people to opt out so, therefore, is he suggesting that his new policy is really not being accepted? MR. DOWNEY: No, Mr.

Chairman, what I am suggesting is that the policy that we have introduced as of the earlier part of 1979 is consistent and still is. What the recent annou ncement has been, that the producers have the option to opt out of the program or stay with the program, and if they have paid their funds, that then in fact we had no more obligation to them, or they had no more obligation to us. I don't have those numbers with me right now, but I might be able to get them.

At this particular time, or since the early part of April, 935 have agreed to terminate their contracts with the province, of which 892 of those had already made payment to the province. So that should maybe clarify the particular point that he is referring to. MR. USKIW: Eight hundred and . . . MR. DOWNEY: Eight hundred and ninety-two, to be specific, had already paid their balance. The additional people that owe money to the province, we haven't got any indication from those numbers which ... I said the ·amount still owing was 1.2.

It's too early at this parti cula r time to make an estimattion of what percentage of those will accept the option to opt out by paying that money up, or in fact stay in the program. As I say, it is too early to estimate at this particular time. As soon as we have that indication, I can let members know. 3407

Thursday, 8 May, 1980 MR. USKIW: Mr. Chairman, what the Minis ter is telling us is that those people who have voluntarily paid back, up to April, were the ones that have said, yes, thanks, for letting us off the hook. But those that have not paid back, of that group only 43 people have agreed to his new policy, which so far indicates that the program is not working. MR. DOWNEY: That's quite correct, Mr. Chairman. I think that the member is saying that there are 43 that have in fact paid back their funds.

I guess the other thing that we should note at this particular time is that they in fact have, until the 31s t of May to make that decision, whether in fact they want to pay their funds to the province and opt out, or whether they don't. And I think it would be unfair to the farm community or those people involved in contracts to suggest that they aren't going to accept that option. The other choice that they have is to remain within the program, and they have the ability to do that, and if they don't accept it, then the contract will continue on. MR. USKIW: Mr.

Chairman, am I to understand then that somewhere over 2,000 people have yet to respond, one way or the other, on that policy change? MR. DOWNEY: That would be correct, in the neighbour of 2,000 people would have the - one­ third have responded, an appr oximate figure of 1, 000, or almost 1, 000, and there would be just over 2,000 that would have to respond in one way or the other. But as I say, they have until the end of May to be able to. MR. USKIW: Yes, Mr. Chairman.

With respect to those contracts that the Mi n ister has placed in default to date, could the Minis ter indicate to us what procedures he is embarking on with respect to collections of those accounts? MR. DOWNEY: If the member could be more clear on what he is referring to as a contract that's in default. MR. USKIW: Mr. Chairman, the Min ister has, through his department, billed certain numbers of these contract holders over the last year or two, for whatever reason, the people have gone out of production, or whatever the reason was, there may be a number of reasons.

But there are a number that he has not been able to collect from. What is his intention with respect to those contracts, where the people are not responding to his demands for payment? MR. DOWNEY: Mr. Chairman, I think to be fair with the farm community again, that decision on the individuals who do not respond in any way to the policy will be dealt with following the 31s t of May. To be more specific, I would consider the money owed to the province the same as money owed to anyone else, that normal procedures would be followed on collection of funds. MR. USKIW: Mr.

Chairman, does the Min ister interpret normal collection procedures as involving court actions should people refuse to pay these accounts? MR. DOWNEY: Well, I guess Mr. Chairman, what the member is saying is, would these people be tested in court, or would the contracts be tested in court, and that would be the route that we would have to go. I guess we also have to point out that the contracts that we would be testing would be contracts that were drawn up by the previous administration, and the strength of those contracts would have to be tested in court. MR. USKIW: Mr.

Chairman, I wonder if the Minis ter would be prepared to table, for the benefit of this committee, a contract entered into by the previous administration wherein there is a stipulation requiring a payback at any given time, because that's essentially what we're talking about, and I would like to see a copy of such a contract. Would the Minis ter agree to table with this comm ittee, a copy of such a contract? MR. DOWNEY: Mr. Chairman, the member is referring to the fact, would there be a cash payback, or whether there in fact would be a payback to the province in livestock that the farmer has?

Under the advice of legal counsel, and people interpreting the contract as contracts because there were three of them, I believe, that was the most suitable way, and the recommended way to proceed.

If the member suggests that we should have put the department's efforts towards the collecting and gathering of livestock, that we were to actually impose that kind of work on the employees to force farmers to hold the livestock on the farms until the province could get around and accept or not accept the cattle that he suggests may have been able to be delivered to the yards, or to a point of sale, I think would have pla ced extreme diffi cu lties on the agricu ltur e community.

We have considered the farmers as our marketing agents, and have requested payment to the province in place of the actual livestock, so it's been done with the recommendation or the support of legal counsel, and that is how we have proceeded. That's basically how we have had to proceed. MR. USKIW: Mr. Chairman, I wish to pursue again, the question, whether the Minis ter is prepared to table for the benefit of this committee, a contract which provides for a payback provision on the part of the producers, where the market price is higher than the guaranteed price.

Could the Minis ter table with this committee, such a document? MR. DOWNEY: Mr. Chairman, I could table the three contracts that were available to the farmers starting 1975, if that's what he is requesting. Yes, I can table the contract. MR. USKIW: Mr. Chairman, I have a 1976 contract which I want to pass over to the Mi nister. I would ask him whether he would be willing to have his staff mark for me on that contract wherein there is a provision for a payback. 3408

Thursday, 8 May, 1980 MR. DOWNEY: Mr. Chairman, I would again say to the Member for Lac du Bonnet that we're dealing with not only the 1976 contract, but two 19 75 contracts which we would also have to deal with. It is not one specific contract he's dealing with. MR. USKIW: Mr. Chairman, I wish to table the 1975 contract, and I would ask the Minis ter whether he would indicate where there is a provision for a payback? MR. DOWNEY: Mr. Chairman, seeing as the member is so obliging, maybe he could table the other 1975 contract. MR. USKIW: Mr.

Chairman, the Min ister is talking about contracts and he doesn't know whether or not they will stand up in a cour t action if they are challenged. And you know, it's very difficult for me to understand how a contract could stand up in a court action with respect to a failure to pay back if that reference is not in the contract in the first place. And that's why I put the question to the Min ister. I would wish to have those contracts returned, Mr. Chairman, I merely want the Min ister to refer them to his department to have his expertise point out to us what

section of that agreement requires a producer to pay any money back to the Crown on the basis that they have realized a price in the marketplace higher than the contract provided for. MR. DOWNEY: Mr. Chairman, as I said, I will also make a copy of the third contract which is in the farm community someplace, and I'll get it out of my department, too. I'll let my department go over these contracts and provide a further explanation of the positions that were taken and the recommendations that we are taking, on a legal ground, and proceed on that basis.

I want to indicate to the member again that I think it has been a matter of looking at the future of the cattle industry, that the contracts that were entered into I am sure were entered into by the producers who needed financial assistance, that the province entered into the contracts with the intention of providing funds to help that particular industry, and now it is a matter of proceeding to deal with those particular contracts. If he is suggesting that there is no obligation to the province, then I would be unable to act on that recommendation because of the legal advice that I have received.

Without elaborating on the specifics of the items that he is referring to, I am unable to do so until I have the three contracts looked at and refer to each one specifically. MR. USKIW: Mr. Chairman, the Minister has all the documentation in his department. He has his staff here. He had them here a year ago when the same questions were posed and he was unable to provide any information to those questions. He again is suggesting that he needs to refer these back to his department for comment or opinion. Mr. Chairman, his staff are here. He has his Deputy Min ister here; he has his accountant here.

There are others from the department that are here who are able to point out - that's why they are here, Mr. Chairman, to assist the Minis ter with his estimates presentation. The Min ister is sitting here telling us that he can't ask them to point out, on a two-page contract, where such an obligation arises on the part of the producers who have a contract with the province of Manitoba. We will not rush him, Mr. Chairman. We will give his staff some time to come up with it while we can discuss other things. But they are here. MR. DOWNEY: Mr.

Chairman, the member wants to suggest that there is no provision in the contracts for payback to the province. I am suggesting that there is a provision in those contracts . MR. USKIW: I would like to see it. MR. DOWNEY: . . . for either cattle numbers, or a certain number of cattle to be provided to the department. He is suggesting that that is not the case; I am suggesting that it is.

First of all, let me say that as far as the stock calves are concerned, that there is no provision for them to market or to provide stock calves to the province, but in fact they have agreed to supply an X-number of slaughter animals, or we have accepted that and had the farmers acting as the marketing agency for the province, that they market those animals and pay the province the difference between the average price and the support price, which is now a ceiling price. MR. USKI W: Mr.

Chairman, I would ask the Min ister whether he can show us, give an example of a precedent where the debtor is in fact obligated to act as a collection agent for the party to whom he owes his debt. I have not heard of such a procedure in all of my years, Mr. Chairman. Usually if there is a collection procedure involved, it invo lves a third party. The Minister is asking the farmer, who owes him the money, allegedly, to be the Mini ster's collection agent; that is what he is saying. I don't know where there is a precedent for that, Mr. Chairman. Perhaps the Min ister might enlighten this committee. MR. DOWNEY: Mr.

Chairman, I guess when he talks about precedents and he talks about the contracts, I do not know where the MLA for Lac du Bonnet, when he was the Mini ster, had the authority or the right to make any changes without having a signed agreement with the producers at the same time. When he allowed them to opt out of the program, there were no sign ed documents or amendments to the contract. If he wants me to go back and provide all the information and the changes that took place during his time, as well as ours, I am quite prepared to do that.

As I said, the formula has remained consistent; the way in which it has been admin istered has remained consistent, except the fact that there was a turnaround in the cattle price, and thank goodness there was, that in fact the price increased and the province was in a position of having to t\ave funds or livestock required to be paid back by the producers. I think it is just a matter of going through the total program, if that is what he wants, and pointing out the total thing.

That, as he is well aware, could take a considerable amount of time because of the documentation that was in place, or things that had 3409

Thursday, 8 May, 1980 happened during his time of administration, the same as our time of administration. Quite a lot of time has lapsed. To get back to the point that he raises, whether in fact we have the ability to collect funds, yes, the advice that I have been given is that we do have and we have been administering it consistent with that advice. MR. USKI W: Mr.

Chairman, the Mini ster is completely absurd on his suggestion that if there is a contract between two people pl acing certain obligations on each party, that one party may not be in a position to waive an obligation on the part of the other without having to amend an agreement. If the Minister owed me 1, 000.00 and I wrote him a letter and said to him, You don't have to repay your 1, 000, I don't think we have to enter into an amended agreement. The letter is sufficient to indicate that he no longer owes me the 1, 000.00. That's essentially what took place during the course of these agreements, Mr. Chairman.

The province, which from time to time chose not to collect on the obligations of the farmers, did so by informing them by a letter. For example, there was a letter that went out that indicated that the reporting was suspended at a period of time. There were obvious reasons for that, because it entailed a tremendous amount of book work which was totally unnecessary since the province was not interested in purchasing those cattle anyway. So the reporting procedures were suspended. That doesn't mean that they could not have been reinstated subsequently.

All the letter said was that they no longer have to give two weeks' notice when they wish to market their cattle. At a further date, it could have been just the opposite that, yes, the province now wants to opt to purcha se those cattle and that the reporting system would have to be reinstated. These are all areas of flexibility, Mr. Chairman, where the province is yielding its ground to the farm communi ty. The only time you can't alter an agreement is where you are placing new demands on the other party. Of course, that is logical.

I don't think anyone would argue that one can do so without a mutual agreement to alter those contracts. But where one party is giving away or yielding to the other or providing an added benefit voluntarily, for the Mi nister to sit here and say that, well, the contracts weren't amended to provide for that, and the Minis ter has fudged the contract because he has yielded to the producers on a number of areas, that is nons ence, Mr. Chairman, the kind of window dressing that isn't going to do the Minis ter any justice or support his arguments.

For two years now, the Minis ter has not been able to supply this committee with an indication of where in tho se contracts there is a req uirement for payback. We asked that last year. He has had 12 months since then to table such a document and he has not done so. I asked him again, and he again says that he has to refer this to his department for advice. I suspect he wants to compl ete his comm ittee considerations here, Mr. Chairman, without having tabled those documents and without having to respond, and to sit on that question for another 12 months. That's essentially what is being suggested here, Mr.

Chairman. Certainly it's not what I would consider to be a responsible approach on the part of the Min ister. If he has a legal opinion that says that he can collect sums of money, the basis of that program, that's fine. I simply want him to show this committee under what

section that legal opinion is derived from and that shouldn't be very difficult, Mr. Chairman. I don't know why this Minis ter can't refer the matter to his legal advisor. He's got advisors around him now, but he may need a legal opinion. He has it, he say's he has a legal opinio n . All we are asking in this committee is that that legal opinion be given to this committee. Under what

section is it that the farmers required to pay back; under what

section of what contract? That's all. MR. DOWNEY: Mr. Chairman, the member again suggests that they were not acting with the proper way in which we should be. I agree and if I have led the committee to believe that anything, that one partner when it was in the favor of the other partner could not do something, then I did not mean to do so.

I guess then in fact if he's using examples of changes that he had made that were or were not in the favor of the producer and could not do so without an amendment to the agreement, and he was somewhat reluctant to and suggests that the cost to production that was used by his admin istration, I'm suggesting the same formula is being used by our particular government and our admin istration, that in fact there were changes made that affected the produc er and not in the best interests of the producer when he continually lowered the cost of production figure without explaining it to them.

At one time, when the initial program was introduced they were using a figure of 51 cents a pound for sla ught er cattle and under his admini stra tion dropped that cost of production to 49. That, Mr. Chairman, I would suggest was a change in the contract without probably mutual agreement. Now it's a technical thing and I might not be correct in suggesting that that would have to be totally the case. I would suggest that we have administered it with the same adminstrator as he had been involved with.

The legal counsel within the government is the same legal counsel as when the contracts were drawn up, that in fact the admin istration of the program has been kept as consistent as possible. The

interpretation of the payback on slaughter cattle has been taken from the contracts that are available.

As far as any of the technical questions on the technical administration of the contract, and I have indicated that if there isn't a payback and it is challenged, it would have to be challenged in a court of law and if the contract stands up in a court of law then the producers, which again say legal advice or legal counsel has told us that they are sound and would hold up, that we are acting on a responsible basis which, no other reason to believe that we're not, then in fact the only way that it can be tested whether we are proceeding in the way in which it is consistent would be to test it in a court of law.

I am prepared to do that. But to sit here and let's just look at what ... we're not requesting any funds for this particular year, and we're talking of the past administration of the program, not the fact that we aren't requesting 3410

Thursday, 8 May, 1980 f1Jnds for this coming year, and I think it's a matter of trying to answer questions here that would have to be answered by a court of law, instead of us sitting here trying to interpr et and suggest one side is right and the other side is wrong. We are dealing with a contract; we are dealing with a program; we are dealing with three different types of contracts. And as I have said since Day One, that we have tried to work with producers who have been involved in the program.

We've been trying to make it so that it has provided them with some reasonable ability to operate within and in fact the cost to production has increased. The figures used have increased to help them, not incons istent with the formula that was used by the last government. The fact that people getting out of the business, leaving the cattle business were allowed to opt out without payback hasn't changed any. The criteria for that, whether it be health or humanitarian reasons, hasn't changed. And I guess this is the answer to the Member from Ste.

Rose in asking yesterday one of the questions he asked, do we consider that - or would I estimate whether there would be a payout this particular year. No, Mr. Chairman, at this particular time the support level and the actual price of beef at this particu lar time, we would not anticipate a payback to the - or a payout from the province to the producers; that in fact where the support level is and where the beef market is today, we would be looking at no payout.

And that's just an estimate of mine without looking at it in more detail or projecting what the end of 1980 livestock prices would be, but all indications are that they will be somewhat above the particular level. So to sit here and debate the actual validness of the contract, I think, is not in the best interests of the time of the committe; that we are not requesting funds to spend this year.

It has been administered consistent with the last administration, and those are about all the comments I have, and as I say I think in the best interests of the total agricultural industry, it would be just as well to proceed on to the next items. MR. DEPUTY CHAIRMAN: The Member for Rock Lake on a point of order. MR. EINARSON: I am taking note of the estimates here, and I fully agree and appreciate the members of the opposition, when they are dealing with taxpayers' money that they have a right and should question as to what is happening to it. But in this particular case, as the Minister has just indicated, Mr.

Chairman, there is no money allocated here and hopefully there will not have to be. MR. USKIW: We don't know that. MR. EINA RSON: The Minis ter has gi ven an indication, Mr. Chairman, on the same point of order, that when there is no money involved here, I don't see why the members opposite have to pursue this matter, because we are not dealing with any money here and I suggest that we get on with the estimates, Mr. Chairman. MR. DEPUTY CHAIRMAN: The Member for Rock Lake does not have a point of order.

Using previous precedents if there is an item on one side or the other side, it's always been allowed to debate as to why or why not it should not be there. The Member for Lac du Bonnet. MR. USKIW: Mr. Chairman, the Min ister suggests that it may be one way to find out whether or not he has the right to collect money· on these accounts is to have it referred to the courts. I believe, Mr. Chairman, that's essentially what the Minister wants to have happen. In his own mind he does believe that a court action would result in a decision against the department.

He would then want to be in a position to say that's because we had such a sloppy contract which was drawn up by the previous administration. That's the scenario that he is playing up, Mr. Chairman. The fact is that it isn't the contract that will be up for adjudication. It will be the Min ister's policy in which case there is no reference to in the contract, the policy of asking farmers to pay back.

That is what a court would have to decide upon, not on whether the contr act demands it, and whether the policy of the government is consistent with the contract is the question before the court, if we have to have a court case on it. I expect that if we had a challenge that the court would rule that the Mini ster's policy is not consistent with the agreement, and that therefore he should have not been collecting those funds. If that is the case, Mr. Chairman, the Mi nister says that is a possibility, then what is he intending to do with respect to those people who have voluntarily paid in their money.

If a court case results in a decision that indicates that the Minis ter had not the legal right to collect these moneys in the manner that he is doing it, or whatever, then what is the Min ister's position with respect to those that have voluntarily paid in? It becomes a conundrum doesn't it, Mr. Chairman? MR. DOWNEY: It is an assumption. MR. USKIW: The Min ister says it is an assumption, but I think it is a fairly reasonable assumption, Mr. Chairman. MR. DOWNEY: It is still an assumption. MR. USKIW: Mr. Chairman, the Minis ter gave a couple of statements, one contradicting the other.

He kept repeating that the department is the same, the staff is the same, and they are administrating this program consistent with the way it was administered by the previous government, and that he said two or three times in the course of his remarks. Then he went on to say, but they viola ted the contract because they reduced the guaranteed price from 51 cents to 49 cents. To him that was a change in the contract tha t was impo sed uni laterally by the department. Mr.

Chairman, the Minis ter knows that the formula for establishing the price has never been altered, at least not by the government prior, I don't know if it has by this government, he says that it hasn't, that the only teason and logic for the change in a guaranteed price is based on the formula, and that is that if you have fluctuations in costs of production, your price will either go up or go down, depending which way the input costs are going. I do recall, Mr. Chairman, that there were times when barley was very expensive, feed grains were 3411

Thursday, 8 May, 1980 very expensive, and there were times during the course of this agreement where feed grains were depressed, the price of feed grains were depressed. Therefore that in itself gives logic to a change in the guaranteed price basis the formula that was part of the contract, Mr. Chairman. And that is the only way in which those prices were able to fluctuate, is on the basis of changes in cost and production. Mr. Chairman, the Minis ter either doesn't know the program or he wants to intentionally mislead the public. It is one of the two, there is no in between.

I would prefer to assume that he doesn't know the program, at least that is credible; but if he wants to mislead the public, that is his choice, Mr. Chairman, I don't consider that a credible position. He can choose which one of those is the correct one, Mr. Chairman. MR. DOWNEY: Mr.

Chairman, what I indicated to the Committee, and the member well knows it, that I did not particularly refer to the total staff as being the same administration, that the administrator of the program is the same as when he was the Min ister, the same individual, so if he is saying that I misled the pu blic, really there was no intent or certainly no need to take that; the individual, who is in charge of this particular program is the same individual. Now as far as the -(I nterjection)- The Member for St. George can laugh if he likes, I have certainly no intention to talk about misleading the public.

There was certa inly no misleading of the public in suggesting the person who is responsible for the program, the administrator of it, is the same. To further discuss the point on whether or not he or the last government had the right to reduce the cost of production, if that is what the fo rmula indicated, then that in fact is the way in which the price should have gone, was lower. I really haven't got into the specifics of that particular period of time, but would be quite prepared to if I felt that it was in the best interests of the time of our producers to do so.

I take the last administration's way in which they handled it as one in the best interests of the producers, and if they felt that in lowering the cost of production was in the best interests using the formula, then I take it and leave it at that. We get into again the question of what is the future of the cattle business, the price of calves and the slaughter cattle this fall. All indications are that using the current support price level, not the current support price level, that in fact there wouldn't be a payout this coming year.

Now we all know that to predict to the end of the coming year would be somewhat a little more difficult to portray, but the best information we have has indicated that we haven't required funds to pay out, and that is all I can indicate at this particular time. If that had of been the case, if we would have been able to portray and see a need, then we would have had to provide funds in this particular allocation. MR. DEPUTY CHAIRMAN: The Member for Lac du Bonnet. MR. USK IW: Mr.

Cha ir man, the Mi n ister has indicated to this committee that the department over the period of, since 1975, has paid out subsidies to beef produc ers in Ma nitoba amounting to some 41,213 ,823.00. The Minister has indicated that he has received from tho se same produc ers 1,31 1 ,248.00. So that in essence, Mr. Chairman, to date there has been an infusion of capital, or a tran sfer of wealth from one group of Ma nitoba citizens to another amounting to 39,902,575.00.

I would like to ask the Minister whether, in his opinion, he can make the argument that a subsidy of 39,902,575 was an unnecessary subsidy over that period of years? MR. DOWNEY: I didn't say that. MR. USKIW: I would like to ask the Min ister whether, in his opinion, that was an unnecessary and un desirable subsidy to the beef produc ers of Manitoba? MR. DOWNEY: No, Mr. Chairman . MR. USKIW: Then, Mr.

Chairman, I would then like to determine from the Minister wherein lies his logic, and it is his words and they were the words of his colleagues, that the program was a disaster to the beef producers of this province? You can't have it both ways. I mean it is either beneficial or it isn't beneficial, and I would like the Minis ter to explain how he can tell this Committee that this was not a bad program, that it was a need that was met, and at the same time try to tell the world that it was a disastrous program. I can't understand the Minister's conflict here within himself. MR. DOWNEY: Mr.

Chairman, I can't understand the member's conflict within himself when I read back some of the Hansards that he has talked. I don't think that we have to get into some of the statements that he made. He's referring to some of my colleagues that made statements, that it didn't help the beef industry. I think what my colleagues had indicated were the fact that it wasn't the actual money that wasn't needed.

It was the way in which the program had in fact been adminis tered and zeroed in on particular individuals that wanted to sign up into that contract or into the program for five years, that a program covering a broader group may have been more effective. I have indicated this at the beginning of my opening remarks on this particular item on the estimates, that in fact the funds that had gone into rural Manitoba had helped the rural economy. The beef ind ustry was in need, the government of the day introduced a program in which they intended to help the beef industry.

I think it's a matter of just going back to some of the comments, and I'll quote from Hansard in February of 1976, I'll quote the Honourable Member for Lac du Bonnet at that particular time: Now let me illustrate for my friend's edification that this is indeed a socialistic program. I don't know whether they realize that, because it has a floor below which the price should not fall but it also has a ceiling above which the participant does not realize any benefits.

The extra amounts of money that happen to come through the marketplace when the market is on the other side of the ledger will flow back into the fund to repay, to some degree at least, the taxpayers who have a propped up the industry in the first place. 3412.

Thursday, 8 May, 1980 I read that back, because his intent was to, I'm sure, recover some of the moneys which in fact is consistent with what we're doing. I don't think we should sit here and debate whether or not it's been hand led rightl y or wrongly; tha t it has been administered as consistent as with what the intent of the program was. That's basically the point I'm trying to make, is that we're trying to work our way through the program so that the producers of this province are able to carry on the business of producing beef. Again, in reference to the Member for St.

George, when he suggested in fact the program did help retain the cattle numbers. In fact, what I had said earlier, it did not maintain our cow numbers. I'll use those figures - I'd just like to get back to the figur es that he referred to the other day, that's Stats Canada, that in fact our total numbers were down in the province for that particular period . MR. USKIW: What period? MR. DOWNEY: For the period of 1976, I believe it was - 1975 to January lst, of 1980. MR. USKIW: Mr. Chairman, can the Minis ter recap the dates again? MR. DOWNEY: The period as of January 1s t, 1975 to January lst, 1980. MR.

USKI W: Could the Minis ter gi ve us the figures? MR. DOWNEY: These are Stats Canada figures, the total reduction in Mani toba's total cattle population, we were down something like 15 percent. Oh, I'm sorry, pardon me, 11 percent. MR. USKIW: That's better. MR. DOWNEY: I'm talking total cattle population. Now these cattle could come from any other province. They could transport in to be fed here in the province or whatever. They are cattle numbers. They could be transported in, they didn't have to necessarily be produced here in the province, but we're talking total cattle numbers on farms. MR. USKIW: On farms?

MR. DOWNEY: Yes, but how do they get on farms? Either they're born on that farm or they come in on a truck, or they're trailed in, as the Member for Ste. Rose might be able to tell you. MR. USKIW: Give us the cow numbers. MR. DOWNEY: We look at the cow numbers for that same period - okay, we're dealing with the period from 1975 to the first - we're down over 13 percent in beef cow numbers. The cow numbers, the figures I have here, were down some 13 percent in beef cow numbers, which for that same period is a little bit below Alberta. MR. USKIW: By how much, Mr. Chairman? MR. DOWNEY: By about one percent. MR.

USKIW: Okay. MR. DOWNEY: And about three percent below Saskatchewan, as an average. So in fact the program that I suggested . . . MR. USKIW: What about Ontario? MR. DOWNEY: It was down 2.9 percent. MR. USKIW: Right. That's right. Okay. MR. DOWNEY: So you agree with the figur es. Mr. Chairman, the figures that we were referring to in my announcement, Mr. Chairman, were 1977 figures. MR. USKIW: Oh, sure. MR. DOWNEY: Okay, now, just let me finish my statement; 1977 to 1980 ... MR. USKIW: The second year of the contract. MR.

DOWNEY: No, 19 77 to 19 80, part of the period, when in fact producers should have been encouraged to keep their number of cows in place to take advantage of the increased cattle prices . . (Interjections)- MR. DEPU TY CH AIRMAN: Order, order. The Honourable Minister. MR. DOWNEY: I believe I have the floor; that we are talking the period when the cattle prices had recovered; the calf prices were strong; there should have been an encouragement to keep the cows to produce the calves; the period from 1977 to 1980, where Manitoba's cow population had reduced by 19 to 20 percent.

Okay, and those are the figures that I used, where our total cattle numbers for that period were down 15 percent. I want to make sure that the members of the committee understand the figures that were being used by both the Member for St. George and that we had used ourselves. So in fact the period of 1977 to 1980, when in fact the program should have shown that it was helping the producers, or had helped them keep their cow numbers, we lost the greatest amount of cows here in the province, compa red to the other provinces, except Ontario which dropped, again, some 21 percent for that period. Mr.

Chairman, just to get back, the initial question was, why were we carrying on with having to pay back. I read out of the Hansard, and what the Member for Lac du Bonnet had indicated what were his intentions, that there would be a payback of funds. MR. USKIW: No. MR. DOWNEY: Well I read it, Mr. Chairman, in Hansard, that he had suggested that's what .. . MR. USKIW: Mr. Chairman, I suggested .. . MR. DOWNEY: Well, just a minute. I believe he said it was a socialistic program, that when it came to the other side of the ledger, will flow back into the fund to repay to some degree to the taxpayers of the province.

It was his intention that moneys would flow back to the province . . . MR. USKIW: That's different. 3413

Thursday, 8 May, 1980 MR. DOWNEY: Mr. Chairman, he says that's different. I don't know how he can have it both ways. Mr.

Chairman, I just want to suggest, that in carrying out with the program, it's a matter of looking at the cow numbers that we have in the province; by looking at the industry - and there's nobody that raises a bigger ruckus when it comes to trying to deal with the farmers in the best way possible than the members opposite, that if they could suggest that there were other ways in which they would see this particular program operated - they've had the chance over the last two and a half to three years to suggest but they really hav en't come up with anything constructive, but mostly critical.

We have suggested the reason for making the move is to allow the province and the producers to work out a new program with the federal government, and I think the Member for Lac du Bonne t agrees that it should be a federal government responsibility. I haven't heard from the Member for St. George, what his comments are in that particular area, but it's a nationally produced commodity.

It should be funded by the federal government and then we don't have the distortions created between the producers, or distortions in the production patterns, where people have the natural advantage that we have here in the province of Manitoba; that on a program such as this nature, the federal government is the best body to administer it. We support that, and now if we can clear the way by allowing the producers to opt out of this particular program, then in fact that is what the intent is. MR. DEPUTY CHAIRMAN: The Member for Lac du Bonnet. MR. USKIW: Mr.

Chairman, I don't believe that anybody on this side is arguing against the Minis ter allowing the producers to opt out of the plan. I have no problem with that. If he feels that is a prudent course of action to take at this time, I have no quarrel with that. All we are questioning, is the methodology of collections that he is employing, because that was never envisaged by our government. I don't believe that it can be justified in a court of law, although I may be wrong, I'm certainly not a lawyer. I just don't believe that if it was challenged that it would be upheld. But that's my opinion, Mr. Chairman.

The Min ister has his own opinions. There is no doubt about it, that when we introduced the program, we talked about five years. Maybe it should have been more than five years, I don't know, Mr. Chairman. If you're talking about stablization, where the public is putting in some money to fill in the valleys, then you have to take off the peaks, Mr. Chairman, if you're talking about stablization. If you are talking about total subsidy or welfare, then that's ano ther dimension, Mr. Chairman. We were not talking about a welfare program when we introduced this program.

We were saying there was potential for some recovery to the Crown, and that potential could be realized by the Crown through the exercise of an option to purchase those cattle if it chose to do so at any given time, if the marketing situation was such that it warranted that kind of action and there was a desire to do so. So yes, there was potential for recovery.

Our only point is, that I think that the Minister is going to end up with a recovery from some people who are volunteering a payback and he's not going to have a recovery from others who insist that it is not part of the agreement, and so we will have what I consider to be an unfair and untenable situation, where the Min ister will not be able to legally extract from those people refusing to pay back any sums of money, while others have volunteered in good spirit and all conscience to pay some mone y back into this program. That is the problem that we are posi ng, Mr.

Chairman, and I am sure the Minis ter recognizes it. Could the Min ister give us the figures using his 1977 calculation year, the figur es for Ontario, Saskatchewan, Alberta, and Manitoba, in terms of cow numbers, and of 1977 to 1980, which he was alluding to but he didn't give us those figures, Mr. Chairman? MR. DOWNEY: Yes, Mr. Chairman, I believe I did, but if I didn't I'll restate them. The period of 197 7-80, Ontario was 21 percent down in their cow numbers; Alberta 6 percent; I'm sorry, the numbers I have here are - 13 percent . . . MR. USKIW: In Alberta? MR.

DOWNEY: Yes, I'm sorry, I'll restate that again, I had the wrong figures before me; Al berta 13 percent; Saskatchewan 15 percent; and Manitoba 19 percent. MR. USKIW: Mr. Chairman, you see what the Min ister is trying to suggest here is, that he wants to - in his example he's using the peak year of production and cow numbers and then showing that between that year and 1980 there was a reduction, which is true, and it was true right across Canada. What he fails to recognize, simply because it doesn't suit his argument, Mr.

Chairman, is that, why did the peak arise in 1977, because the depression was in 1975 and 1976, and by all standard measure, without any program, there should have been a mass exodus, a mass reduction of cow numbers in 1975- 76, and 1977, Mr. Chairman, until the market turned around. But in fact what took place was, we were still building up our herds right into 1977, despite a depression in the cattle industry, and that is the measure of the program, Mr . Chairman.

It's the period of crisis that measures your program, not the period of recovery and post-recovery, which is what he is alluding to, from 1977 to 1980, Mr. Chairman. 1977 to 1980 is a post-recovery period, 1975 to 1977 is the depression period, and we have an increase in cattle numbers, cow num bers, all numbers, from 1975, Mr. Chairman, to 1977. So, Mr. Chairman, the credibility of my honourable friend leaves much to be desired. Window dressing is fine, providing you have a bunch of dummies on this side, Mr. Chairman, that can't see through him. Mr.

Chairman, the Minister is not going to be allowed to get away with that kind of nonsense. Using his own figures, the Minister defeats his argument. MR. CHAIRMAN: The Member for St. George. 3414

Thursday, 8 May, 1980 M.R. URUSKI: Thank you, Mr. Chairman. I'd like to ask the Min ister, how many farmers have notified the department that they were selling their cattle under the terms of the contract? MR. DOWNEY: Mr. Chairman, when the member asks, how many people have notified the department they were going to sell their cattle, or actually have sold, that have been a part of the contract? MR. URUSKI: No, Mr.

Chairman, I think if the Min ister reads the contract, one of the stipulations in the contract is that, I believe it's two weeks prior to the shipping date, the in dividual who is un der contract should notify the department of his intention to sel l. How many producers have notified the department that they intend to sell? MR. DOWNEY: I guess the member is referring to the fact that within the contract that he's saying that they had to notify the province. That was waived by the last administration.

The way in which it has been administered by our department, they have been told that they have owed X number of dollars on the sale of those particular cattle. MR. URUSKI: Maybe I didn't hear the Mini ster right. The Min ister said, the provision was waived by the last administration? MR. DOWNEY: The no tification of marketing intentions was, in fact, waived prior to our coming into government. MR. URUSKI: Completely waived. MR. DOWNEY: That is correct. I would have to get the document ation to see, Mr.

Chairman, jus t whether it was waived, suspended, or what the terminology was, but in fact they were told that they didn't have to report their marketings. MR. URUSKI: Mr.

Chairman, the Minister, in his discussions last year and this year again, seems to suggest that the cost of production formula that was arrived at, that there is some suspicion that the formula is out of whack, that he somehow, is the champion of farmers, that the price should be increased, but somehow he can't do it because it was set down by the previous administration, at least leaving the impression in my mind, that somehow the cost of production formula is out of line.

I distinctly received the impression from the Min ister today that he is saying, look, you guys, you remember you knocked the formula down, and I don't think it's accurate, but that's the impression he's leaving, has left with me. Can he tell me whether he's done an analysis since he is certainly leaving that impression with myself, and I'm sure he's left it with farmers in the province, that although he is sympathetic to their wishes, he can't change the formula because it was put into stone by the previous administration and he's not prepared to change it.

Can the Minister tell me, has he done an analysis, and where does he think the formula is out, because I think there are producers, and I know there are producers who have done an analysis on the cost of production, and their figures vary greatly with that of the provinces. In fact, to the point where their producers have indicated that the cost of production, in their figures, of beef, is roughly 1.00 a pound, in terms of producing beef, a substantial difference from that in the department. I know the Minis ter leaves the impression that he is very sympathetic to that.

Can he tell me whether he's looked at the formula, is it out of whack anywhere? MR. DOWNEY: Mr. Chairman, the member makes reference to the actual changing of the formula. I have said from Day One that the formula is the same that was put in place when they entered into the contract. Again, if we were to change the actual ground rules or the formual base, I would think we would have to make an amendment to the agreement. Inputs to that formula change, and we haven't changed that base formula. The inputs put into the formula have been changed, and I guess this is what the member is referring to.

I haven't meant to leave the impression that the formula is wrong. It was put in place by agricultural economists, the same ones that were involved when you were in government, and the same ones as when I'm in government. Sure, we have reviewed it, but felt that it was in the best interests of both parties to leave it where it is. Now, the changing of the inputs to that formula have been changed, and the end result has indicated a higher cost of production value after changing the input.

So if I have left the impr ession that the formula is wrong, it hasn't been by intent, but has in fact, tried to keep the program as consistent as possible. As I say, the inputs to that formula can be changed, have been changed, and I haven't reviewed it.

The Member for Lac du Bonnet mentioned that in reducing the cost of production formula when it was done under him as Min ister, if that was the case, then there's no need to review it, but if we were to go back and review that particular time element, and the old figures were consistent with the way it should have been done, then it was done in the proper manner. And I haven't inf erred that that was done for any particular reason. I've said the formula is the same one that has been used, is being used as when the farmers entered the program. MR. URUSKI: Mr.

Chairman, the Minis ter really hasn't answered my question.

I wanted to know whether he agrees that a formula is, as far as he is concerned, adequate and accurate in terms of reflect ing a true cost of produc tion, because certainly, whether he's meant to or hasn't meant to, whether it's deliberate, I will give him the benefit of the doubt that it wasn't deliberate that he has left that impression with producers and media people that somehow he'd like to change the formula, but look, it's been established in stone and we're not prepared to change it, because that's the way the previous administration brought it in.

We aren't in agreement with the program, the Member for Emerson, yesterday, I gather, said that the program was a disaster. Now, being a disaster and seeing how this government has deliberately attempted to discredit the program through its actions or lack of actions, then I suspect, and I want to know from the Minister, he has said that he's 3415

Thursday, 8 May, 1980 sympathetic to the costs of production, and let's have him have a look. Has he had a look? Has he investigated some of the farmers' concerns that have been raised that the formula is out of whack? Is the formula out of line with today's costs of production, and does he agree with farmers' concerns that it is out of line, or is the formula in line? MR. DOWNEY: Mr. Chairman, I have indicated that I have no reason to change the formula at this particular time. I answered that. -(l nterjection)­ We have adjusted it, Mr. Chairman.

When I say, adjusted the formula, we have adjusted the inputs. -(I nterjection)- Well, an adjustment to the formula then I would think would require some - if I were to change it, in any other way other than in favour of the pr oduc er, then it would mean a com plete amendment and agreement with the producers to do that. It operated for about three years under the - yes, we could enter into changing the program, but it has operated for thr ee years un der the last admin istration, which had indic ated the cost of production was going down.

The inputs and the turnaround and the input costs have indicated that the cost of production is going up, which is not very nice, but it's what happened, and it has reflected the actual happenings in production of agriculture goods. Now, the Member for Ste. Rose says that it cost him 85 cents to produce beef. You have indicated, some producers have indicated that it cost them 1.00 a pound. MR. URUSKI: Based on their formula, not on your formula. MR. DOWNEY: Okay, some produc ers ha ve indicated that 81 cents is their cost of production.

It's something that changes to some degree with the different costs of inputs and we're all familiar with that. I guess if the members are recommending that we should do a review of the formula, well, the Member for Lac du Bonnet says it's too late. We're in the position of, and I've said it many times over, we're trying to admin ister it so it's in the best interests of the producers and keeping them in business and giving them some form of protection.

In looking at, and I'll say this in a more general term, on stabilization, and I believe this is what we have to do at this particular time, and the Member for Lac du Bonnet yesterday alluded to some of the things that probably should happen, and I have said this, and have been working in this direction. I believe now we have seen a series of stabilization programs throughout Canada on beef, hogs, the uncontrolled commodities, that in fact we have to look at all those programs and have a committee to take out the best points in them all.

We've seen a federal program in place, I think we have to work together with the objective of providing a stable income. I disagree with the Member for Lac du Bonnet that we should be in a position of taking the peaks out of the marketplace for the producers. I believe that the producers, that is the incentive that they have to get a little bit extra at certain times of the year. -(I nterjection)- No, I'm talking about a stabilization program, Mr.

Chairman, where in fact, if you put a stabilization program in place that takes the severe declines out of the marketplace, where in fact there's a stability for those particular periods C?f year, well, the Member for Lac du Bonnet says it's welfare. I do not call it welfare; I do not want to refer to any farmer as being a recipient of welfare. I think it's very much the opposite. We've had, too long in this country, a cheap food policy, put in place and kept in place by the federal government, a cheap food policy. That didn't change any under the last administration in Manitoba.

It was just a matter of trying to pacify the particular segment of the industry at that particular time to keep them away from the Minister that was in place of the day, with the intent of helping those producers but still not getting away from the cheap food policy. So I think it's a matter of taking the stabilization programs that are in place from one side of this country to the other, for the beef industry, bringing out the positive points, and encouraging and working with the federal government to implement them on a national basis.

I think that's the point we're at in Canadian agriculture production, that the producers, if they're going to be expected to stay in business, that they have to be afforded that form of stability. They have to still be given the opportunity to go out and produce for an international market, that in fact we don't want to try and take the tops off their production peaks, or the prices which they may receive, but in fact, take the severe lows out of it.

With those thoughts in mind, I think that we can and we will, over the next period of a few years, have a program that will be a long term stabilization program, not one, as the member said, maybe it should have been a different length of time, the program that was introduced by him, the five-year program. I think we have to have it so that, No. 1, the producer can be a voluntary participant, and I use the example of the grain stabilization program; it may not be as good as some people would like to see it, it's a subsidized program by the federal government. Where else is it going to come from?

If that government expects you to produce food for less than what it costs to produce, then there has to be a subs idy come from the taxpayer. - (I nterjection)- No, they shouldn't expect it. They shouldn't expect that people produce for less than the cost of production. Farmers will produc e quantities of food if they are paid fairly and equitably for tha t and a reasonable return. Ther e is no question about it and that shouldn't be taken away from them, the right to produce and to produce the quantities which they want or see as their target goals. -(lnt jerection)- The member says, like in hogs.

At this particular time we have seen somewhat of an increase in the num bers of hogs in North America, but I think it is a very short-lived period of time that we are going to see the depressed prices in hogs that we are seeing today, because the numbers of beef were down, the numbers of the pounds of cattle that are being fed. He says it's a cycle. 1971 was the last particular period of time that we saw the hog prices where they in fact were creating problems for the hog producers.

We have seen some levelling out periods in that particular time but in fact the hog surplus that I think we are in now will be very short­ lived. To get back to the principle of stabilization, I believe very firmly that the producers of the province 3416

Thursday, 8 May, 1980 sh ould be allowed to participate totally on a voluntary basis. MR. DEPUTY SPEAKER: The Hono urable Member for St. George. MR. URUSKI: The Minis ter still didn't answer my question that I raised with respect . . . I would like to know whether he considers the formula accurate in terms of the cattle prices. Does the Mi nis ter consider the form ula adequate in terms of the Stabilization Program as it exists today? That's all I want to know. MR. DOWNEY: I guess, Mr. Chairman, what we would have to do is have an update of all the inputs that go into the formula so we could make that judgement.

Because of the fact that it is operating figuring on the last formula that is in place now, the cost of production that we are using, 61 cents, that is being calculated for the year 1979. We are into a new production year, 1980, and if we put some new input figures into it and it doesn't come up with some of the figures that the agricultural commun ity, the beef producers are saying they should have, then I think it would be a matter of reviewing that whole formula.

If the producers, and we won't know until after May 31 the numbers of producers that are left in the program - we may be in the position of not having to do that. MR. DEPUTY CHAIRMAN: The Member for Lac du Bonnet. MR. USKIW: Mr. Chairman, I would like to ask the Minister to table before this committee every change in the cost of production and the basis for the change since this Minis ter has had the responsibility of this program. MR. DOWNEY: Just since I've been . MR. USKIW: Yes. MR. DOWNEY: Mr. Chairman, the member is asking for every change in the formula from . MR. USKIW: No, not in the formula. MR.

DOWNEY: In the actual inputs. MR. USKIW: In the cost of production. MR. DOWNEY: Since when? MR. USKIW: Since October of 1977. MR. DOWNEY: Would he not want to see it tabled prior to that particular period? MR. USKIW: No. I have no problem with that; I know those. MR. DOWNEY: I just wondered if he wants the total thing. MR! USKIW: Sure, it doesn't matter. MR. DOWNEY: Mr. Chairman, I would gi ve consideration to that. MR. USKIW: Mr. Chairman, the matter has never been a secret. The formula is a public formula.

I am merely asking the Minis ter whether he would table with this comm ittee each change that took place since October of 1977 and how it flows from the original formula; in other words, every input cost that went up, by how much, and how that changed the formula, whether it is feed grain or whether it is twine or whether it is hay. I mean, there is a formula, and it's a base figure. I would like to know, or get a copy of each change since that time, on every input cost that has taken place. MR. DOWNEY: Mr. Chairman, I can see no problem with that, from the time that the program was introduced, I ... MR.

USKIW: It doesn't matter; I want it from 1977. MR. DEPUTY CHAIRMAN: The Member for Ste. Rose. MR. ADAM: Mr. Chairman, on the same point, I recall that when we were at this Glenella meeting, there were a lot of questions from the floor in this regard about the formula and the costs. I asked the Minis ter at that meeting whether he would consider sending a copy to every rancher, and the Min ister undertook to do that; he said he would. I am just wondering whether he has or not, because it was obvious from the questions that came from the floor that that's where the big hang-up was.

Nobody understood the program or the formula and they wanted to know just how the inputs were arrived at. The Min ister undertook that night to provide that. That was one of the only things I asked him and he said he would do it. Since the Minister agreed to do it at Glenella, that's the same thing that is being requested now, and I'm just wondering why there would be any difficulty. MR. DEPUTY CHAIRMAN: (b)- pass; (c)(1) - the Member for St. George. MR. URUSKI: I didn't want it to run away in terms of the Beef In come Assurance Program. Mr.

Chairman, the members of the government side indicated in the last 1976-76 that the cattle prices in Manitoba and across this country declined because there was - at least they alleged - government inefficiencies, government programs, and as a result, there was an oversupply of cattle in this country, an overproduction of cattle and that caused the decline in prices in th ose years and tha t caused the depres sion. It was gove rnm ent programs.

The Member for Emerson was one of those; the Member for Rock Lake; the Member for Neepawa - all these members continued their statements that the decline in beef prices was a direct result of governmental programs which led to an overproduction of beef in Manitoba and in western Canada; this was the direct cause. Can the Mi nis ter indi cate to me what the consumption and the production of beef in this country is. Has the department got those statistics as to what Canada or Manitoba - I know Manitoba has always been a net exporter of beef - but what 3417

Thursday, 8 May, 1980 the net production of beef in this country has been? Let's take the five-year average, the same five or six years of 1975, 1976, 1977, 1978, 1979, or even 10 years if the Minis ter has those figures, but whatever is more readily available to him, and if he has those figures handy, in terms of production of pounds of beef and consumption of pounds of beef. Or what kinds of figu res are available in that area? MR. DOWNEY: I can provide that information on a table if it will be available from the statistics.

But as far as an upda te, the in formation tha t I have available, to this particular point in Canada - and the Member for Lac du Bonnet asked me in the House the other day - to this particular point, from January 1, 19 80 to now, we are actually a net exporter of red meat. I think that's correct, the information that I have available to me, I've checked it out, that we are in a position of export at this particular time. Probably the year or two years prior to this, we have been importers of red meat, but for the last period of time, from 1980 to now, we are in a position of export out of Canada. MR.

URUSKI: That's three months. MR. DOWNEY: For this particular year. It may reverse and we may become a net importer by the end of the year, but to this particular point in time, we have been an exporter of red meat. MR. URUSKI: Has the Minis ter got - does he have those figures that I have asked him for or can he tell me, say, if he's got statistics in the last ... When has Canada been a net exporter of beef? MR. DOWNEY: I would have to have tha t information provided. I just indicated that for the last two years, we have been net importers. Now, how far back that goes, I would have to check it out.

We could have been for the last period, for years, but the information I have available to me right now is that we have been an exporter to this time of this year and that for the past two years we have been importers. I'll provide all that information for him. MR. URUSKI: The Minister has had statistics on cattle numbers going back to 1975. Would he have statistics of imports and exports of beef to 1965 in his records available to him? MR. DOWNEY: Pardon me, 1975? Is that what you are ... MR. URUSKI: Yes, let's take it from 1975. If you want to go back further, it's fine with me. Let's go to 1965. MR.

DOWNEY: information. We ll, 19 75, I'll provide that MR. USKIW: Let's go back 20 years and we'll see the whole picture. MR. DOWNEY: No problem at all. Canadian information is available to anyone; I'll make that information available. It will be the indications of where we are at. MR. DEPUTY CHAIRMAN: The Member for St. George. MR. URUSKI: Mr. Chairman, I question the Minister on a number of statements of his.

Does the Min ister agree - can he indicate his position with respect to certain statements that have been made within the beef indus try and Mem bers of the Legislature that it has been government programs that have caused beef prices in this province and in this country to go down as a result of a surplus of production of beef in this country. Does he agree with those statements? MR. DOWNEY: I don't know who he is referring to that made the statements, but I think in certain cases, yes.

There have been certain government programs that have influenced the production of beef cattle, tha t have in fact probably encou raged production where in fact it has hurt those individuals. I would like to qualify this. I think that there is room for government to work, to support production and encourage it, but they have to be very careful in introducing programs tha t it is not false encouragement.

That's, I think, the area where they get into problems, is when they have either price incentives or inputs put into their returns that aren't of natural nature or, in fact, can be removed by government and you have people built up on false props. I think it is a matter of not having an agricultural indus try that responds to false price inc entives where, in fact, if those incentives were removed, then the producers get into problems. MR. CHAIRMAN: The hour being 4:30, I am leaving the Chair for Private Members' Hour and will return at 8:00 p.m. Committee rise. SUPPLY - COMMU NITY SERVICES AND CORRECTIONS MR.

CHAIRMAN, Abe Kovnats (Radisson): This committee will come to order. I would direct the honourable members' attention to Page 18 of the Main Estimates, Department of Community Services and Corrections. Resolution No. 27. The Honourable Member for St. Boniface. MR. DESJARDINS: Thank you , Sir. Did the Minis ter get the information on the agencies, the list of the agencies and the grants that they were receiving? I had hoped that we would have a chance to look at this outside the House before we . . MR. CHAIRMAN: The Hono urable Min ister. MR. MINAKER: Mr.

Chairman, it is my understanding that list will be ready for tomorrow morning. MR. CHAI RMAN: Resolution No. 27, Item 1. Executive Function (a)

(2) Salaries- pass - the Honourable Minister. MR. MINAKER: Mr. Chairman, if I might just take a few moments at this time. I was keeping track of the number of points that were raised by the Honourable 3418

Thursday, 8 May, 1980 Members for St. Boniface, Elmwood and Fort Rouge, in their opening remarks and some of their statements and concerns that I would like to reply to at this time. In

part icula r, with regard to the Honour able Member for St. Boniface, I appreciate his comments with regard to reserving comment at this time with regards to some of the divisions in our department, and with regards to whether or not the splitting of the two departments would provide better services to our people in Manitoba. What I would like to comment on in particular is that the honourable member did mention something with regards to family day care that it hadn't been used in ... MR. CHAIRMAN: The Honourable for St. Bon iface on a point of order. MR.

DESJARDINS: On a point of order and in the spirit of co-operation in trying to help a new Minister who is just starting, the format, I guess, it has been for the Minis ter to make opening remarks, and as I said when I answered him, he covered the waterfront so we did touch on some of the areas. We reply to this. Now we are going line by line, I have no objection, but it would be a lot easier for the Minister when we come to day care we'll have that, because right now we are strictly on Salaries.

We could talk - I didn't interrupt him immediately, because the division of the departments certainly could be taken there, but we are talking about the Deputy Minister and Sal aries now. It is imma terial to me, Mr. Chairman. I was just trying to be helpful. MR. CHAIRMAN: To the Member for St. Boniface and to all of the members, I was just about to make the same remarks, and I would hope that the Honourable Minister would take them in the way that they are extended. This item really is not a debatable item unless the members want it to be debated.

I think tha t the things that were brought up in the opening remarks and the reply to opening remarks could be covered when we go line to line. The Honourable Member for St. Boniface. MR. DESJARDINS: If I am correct, we are now on 1.(a)

(2) Salaries and tha t itself is a debatable subject, not the statement of the Min ister, that is gone, but we on a debatable . . . MR. CHAIRMAN: Absolutely. I will call out the item under discussion once again. It is Item

(2) Salaries­ pass; Item

(3) Other Expenditures- pass - the Honourable Member for Transcona. MR. WILSON PARASIUK: We have gone from a zero expenditure in 19 80 to 43,000, there was Salaries, 10 6,000 last year, what are the other expen ditur es for? Is tha t because of the Department? MR. CHAIRMAN: The Honourable Minister. MR. MINAKER: Mr. Chairman, as it was indicated, I believe, by one of his colleagues, it is a new office that has been established and it primarily covers - the main categories would include printing, stationery, telep hon es, travel ling for federal­ provincial conferences and negotiations, are basically the main components of that. MR. CH AIRMAN: (3)-pa ss; Item (

b) Social Services Advisory Comm ittee, Item

(1) Salaries­ pass - the Honourable Member for Seven Oaks. MR. MILLER: I notice there has been a decline in the amounts of dollars over the last number of years, and I believe there is one staff less than there has been in the past years. I am wondering, can the Minister advise us whether in fact this Committee is meeting less often or whether it is because there are less appeals presented to them? What is the reason for slowdown in the activity of this particular body?

Because as I recall it this Committee is available to anyone who feels that they haven't been fairly dealt with, either through the province or the municipality. As I recall when we first developed it, it was to make it possible for people to appeal just rulings that very often wouldn't even hold up under an appeal, and I am wondering what the reason is for the decline in funds available and in the staff. MR. CHAIRMAN: The Honourable Minister. MR. MINAKER: Mr. Chairman, to the Honourable Member for Seven Oaks, I would like to inform - (I nterjection)- I have always known him as the Mayor of West Kildonan.

There actually isn't a reduction in staff man years, they are the same as they were last year. Wha t has happened is that there has been a new incumbent who has a lower salary, that was hired at a lower salary than what the one that had the position before was earning. With regards to the number of appeals, they are approximately about the same number as they were back in 1976, and the projected for 1980 is 350; in 1976 there was 360 appeals; 1977, 388; 1978 was 424; in 1979 was 332.

I would presume the reason that there has been a reduction in the number of appeals is one that the caseload has been going down during the past few years, so I guess there is a relation of the percentage that appeal when you are dealing with cases. And also I would think it might too - and I believe it to be correct - is that we have a pretty good department that is dealing with the Social Assistance Program at the present time, and would presume that there are less people that are requiring appeal methods. MR.

MILLER: Of cou rse, it isn't just the appeals from the department, it is the appeals also from municipal bodies as well, and if my memory serves me correctly, that is, I think, some of the greatest problems came from those appeals, but the Min ister is indicating that it has pretty well held constant, some fluctuations from year to year with the peak being in 1978 - 424 in 1978, I believe it what he said, if I heard correctly. The Min ister is assuring us that, in fact, this Commit tee is still operating effectively, and it is available, and tha t people still have the right and the pri