Manitoba Hansard — 3 July 2001 (Sitting 56, 37th Legislature, 2nd Session)

37-2-56

Manitoba — Debates (Hansard)

Second Session- Thirty-Seventh Legislature ofthe · Legislative Assembly of Manitoba DEBATES and PROCEEDINGS Official Report (Hansard) Published under the authority of The Honourable George Hickes Speaker Vol. LI No. 56- 1:30 p.m., Tuesday, July 3, 2001 ISSN 0542-5492

Member AGLUGUB, Cris ALLAN, Nancy ASHTON, Steve, Hon. ASPER, Linda BARRETT, Becky, Hon. CALDWELL, Drew, Hon. CERILLI, Marianne CHOMIAK, Dave, Hon. CUMMINGS, Glen DACQUAY, Louise DERKACH, Leonard DEWAR, Gregory DOER, Gary, Hon. DRIEDGER, Myrna DYCK, Peter ENNS,Harry FAURSCHOU, David FRIESEN, Jean, Hon. GERRARD, Jon, Hon. GILLESHAMMER, Harold HEL WER, Edward HICKES, George JENNISSEN, Gerard KORZENIOWSKI, Bonnie LATHLIN, Oscar, Hon. LAURENDEAU, Marcel LEMIEUX, Ron, Hon. LOEWEN, John MACKINTOSH, Gord, Hon. MAGUIRE, Larry MALOWA Y, Jim MARTINDALE, Doug McGIFFORD, Diane, Hon. MIHYCHUK, MaryAnn, Hon.

MITCHELSON, Bonnie MURRAY, Stuart NEVAKSHONOFF. Tom PENNER, Jack PENNER, Jim PITURA, Frank PRAZNIK, Darren REID, Daryl REIMER, Jack ROBINSON. Eric, Hon. ROCAN, Denis RONDEAU, Jim SALE, Tim, Hon. SANTOS, Conrad SCHELLENBERG, Harry SCHULER, Ron SELINGER, Greg, Hon. SMITH, Joy SMITH, Scott, Hon. STEFANSON, Heather STRUTHERS, Stan TWEED, Mervin WOWCHUK, Rosann, Hon. MANITOBA LEGISLATIVE ASSEMBLY Thirty-Seventh Legislature Constituency The Maples St. Vital Thompson Riel Inkster Brandon East Radisson Kildonan Ste.

Rose Seine River Russell Selkirk Concordia Charles wood Pembina Lakeside Portage Ia Prairie Wolseley River Heights Minnedosa Gimli Point Douglas Flin Flon St. James The Pas St. Norbert La Verendrye Fort Whyte St. Johns Arthur-Virden Elmwood Burrows Lord Roberts Minto River East Kirldield Park Interlake Emerson Steinbach Morris Lac du Bonnet Transcona Southdale Rupertsland Carman Assiniboia Fort Rouge Wellington Rossmere Springfield St. Boniface Fort Garry Brandon West Tuxedo Dauphin-Rob lin Turtle Mountain Swan River Political Affiliation N.D.P. N.D.P. N.D.P. N.D.P. N.D.P. N.D.P. N.D.P. N.D.P. P.C. P.C. P.C.

N.D.P. N.D.P. P.C. P.C. P.C. P.C. N.D.P. Lib. P.C. P.C. N.D.P. N.D.P. N.D.P. N.D.P. P.C. N.D.P. P.C. N.D.P. P.C. N.D.P. N.D.P. N.D.P. N.D.P. P.C. P.C. N.D.P. P.C. P.C. P.C. P.C. N.D.P. P.C. N.D.P. P.C. N.D.P. N.D.P. N.D.P. N.D.P. P.C. N.D.P. P.C. N.D.P. P.C. N.D.P. P.C. N.D.P.

3375 LEGISL ATIVE ASSEMBLY OF MANITOBA Tuesday, July 3, 2001 The House met at 1:30 p.m. PRAYERS ROUTINE PROCEEDINGS PRESENTING PETITIONS Kenaston Underpass Mr. John Loewen (Fort Whyte): I beg to present the petition of Joe Florentino, Maria Stabene, R. Florentino and others, praying that the Premier of Manitoba (Mr. Doer) consider reversing his decision to not support con struction of an underpass at Kenaston and Wilkes. Mrs. Myrna Driedger (Charleswood): I beg to present the petition of Gene Dunn, Roy Cook, Ray Snitynsky, praying that the Premier of Manitoba (Mr.

Doer) consider reversing his decision to not support construction of an underpass at Kenaston and Wilkes. READING AND RECEIVING PETITIONS Kenaston Underpass Mr. Speaker: The honourable Member for Fort Whyte (Mr. Loewen), I have reviewed the peti tion and it complies with the rules and practices of the House.

Is it the will of the House to have the petition read? [Agreed] Madam Clerk (Patricia Chaychuk): The petition of the undersigned citizens of the province of Manitoba humbly sheweth: THAT the intersection at Wilkes and Kenaston has grown to become the largest unseparated crossing in Canada; and THAT the volume of traffic for this railroad crossing is twelve times the acceptable limit as set out by Transport Canada; and THAT vehicles which have to wait for trains at this intersection bum up approximately $1.4 million in fuel, pollute the environment with over 8 tons of emissions and cause approxi mately $7.3 million in motorist delays every year.

WHEREFORE YOUR PETITIONERS HUMBLY PRAY THAT the Premier of Manitoba consider reversing his decision to not support construction of an underpass at Kenaston and Wilkes. Mr. Speaker: The honourable Member for Charleswood (Mrs. Driedger), I have reviewed the petition and it complies with the rules and practices of the House.

Is it the will of the House to have the petition read? [Agreed] Madam Clerk: The petition of the undersigned citizens of the province of Manitoba humbly sheweth: THAT the intersection at Wilkes and Kenaston has grown to become the largest unseparated crossing in Canada; and THAT the volume of traffic for this railroad crossing is twelve times the acceptable limit as set out by Transport Canada; and THAT vehicles which have to wait for trains at this intersection bum up approximately $1.4 million in fuel, pollute the environment with over 8 tons of emissions and cause approxi mately $7.3 million in motorist delays every year.

WHEREFORE YOUR PETITIONERS HUMBLY PRAY THAT the Premier of Manitoba consider reversing his decision to not support construction of an underpass at Kenas ton and Wilkes. * (1 3:35)

3376 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 2001 PRESENTING REPORTS BY STANDING AND SPECIAL COMMITTEES Standing Committee on Municipal Affairs Second Report Mr. Harry ScbeUenberg (Vice-Chairperson): Mr. Speaker, I beg to present the Second Report of the Committee on Municipal Affairs. Madam Clerk (Patricia Cbaycbuk): Your Standing Committee on Municipal Affairs presents the following- Some Honourable Members: Dispense. Mr. Speaker: Dispense. Your Standing Committee on Municipal Aff airs presents the following as its Second Report. Meetings: Your committee met on: Thursday, June 28, 2001, at 10 a.m.

Thursday, June 28, 2001, at 6:30 p.m. All meetings were held in Room 254 of the Legislative Building Matters Under Consideration: Bill 31- The Municipal Assessment Amendment Act/Loi modifiant Ia

Loi sur /'evaluation municipale Bill 32-The City of Winnipeg Amendment Act/Loi modifiant Ia

Loi sur Ia Ville de Winnipeg Bill 34-The Municipal Amendment Act/Loi modifiant Ia

Loi sur les municipalites Bill 38-The Local Authorities Election Amendment Act/Loi modifiant Ia

Loi sur /'election des autorites locales Bill 43-The Auditor General Act/Loi sur le verificateur general Bill 48- The City of Winnipeg Amendment (Pensions) Act/Loi modifiant Ia

Loi sur Ia Ville de Winnipeg (regime de pension) Membership Resignations/Elections: At the Thursday, June 28, 2001, at 10 a.m. meeting, your committee elected Mr. Schellenberg as the Vice-Chairperson. Substitutions received prior to commencement of the Thursday, June 28, 2001, at 10 a.m. meeting: Ms. Ceril/i for Mr. Dewar Hon. Mr. Selinger for Hon. Ms. Wowchuk Mr. Loewen for Mr. Cummings Mr. Laurendeau for Mr. Penner (Emerson) Mr. Derlrach for Mr. Pitura Substitutions made, by leave, during committee proceedings at the Thursday, June 28, 2001, at 10 a.m. meeting: Mr. Tweed for Mr.

Loewen Substitutions received prior to commencement of the Thursday, June 28, 2001, at 6:30 p.m. meeting: Mrs. Smith (Fort Garry) for Mr. Tweed Mr. Martindale for Mr. Struthers Hon. Ms. McGiff ord for Ms. Cerilli Substitutions made, by leave, during committee proceedings at the Thursday, June 28, 2001, at 6:30 p.m. meeting: Mr. Faurschou for Mrs. Smith (F ort Garry). Public Presentations: The following individuals and/or organizations made presentations on Bill 31-The Municipal Assessment Amendment Act/Loi modifiant Ia

Loi sur /'evaluation municipa/e: David Sanders, Colliers Pratt McGarry Rick Weind, CUPE Local 500 Councillor Jae Eadie, City of Winnipeg Henri Dupont, KPMG Jim Baker, Manitoba Hotel Association Antoine Hacau/t, Private Citizen John Petrinka, Norman Commercial Realty Ltd. The following individuals and/or organizations made presentations on Bill 32-The City of Winnipeg Amendment Act/Loi modifiant Ia

Loi sur Ia Ville de Winnipeg: Councillor Jae Eadie, Councillor, City of Winnipeg David Sanders, Colliers Pratt McGarry The following individuals and/or organizations made presentations on Bill 38-The Local Authorities Election Amendment Act/Loi modifiant Ia

Loi sur /'election des autorites locales:

July 3, 200 1 LEGISLATIVE AS SEMBLY OF MANITOBA 33 77 Councillor Jae Eadie, Councillor, City of Winnipeg Roger Goethals, Reeve, R.M of Winchester Neil Hathaway, Private Citizen Richard Sexton, Private Citizen Bob McCallum, Reeve, R.M of Morton * (1 3:40) Written Submissions: The committee received one written submission on Bill 31-The Municipal Assessment Amend ment Act/Loi modifiant Ia

Loi sur /'evaluation municipale from: Joe Masi, Associ ation Municipalities of Manitoba The committee received one written submission on Bill 32-The City of Winnipeg Am endment Act!Loi modifiant Ia

Loi sur Ia Ville de Winnipeg from: Joe Masi, Assoc iation of Manitoba Muni cipalities The committee received one written submission on Bill 34-The Municipal Am endment Act !Loi modifiant Ia

Loi sur les municipalites from: Joe Masi, Assoc iation Municipalities of Manitoba The committee received one written submission on Bill 38-The Local Authorities Election Amendment Act/Loi modifiant Ia

Loi sur /'election des autorites locales from: Wayne Mothera/, President, Association of Manitoba Municipalities Bills Considered and Reported: Bill 31-The Municipal Assessment Amendment Act/Loi modifiant Ia

Loi sur !'evaluation municipale Your committee agreed to report this bill, without amendment, on division. Bill 32-The City of Winnipeg Amendment Act/Loi modifiant Ia

Loi sur Ia Ville de Winnipeg Your committee agreed to report this bill, with the following amendment: THAT the proposed subsection 138. 4(2), as set out in

section 4 of the Bill, be struck out. Bill 34-The Municipal Amendment Act/Loi modifiant Ia

Loi sur les municipa/ites Your committee agreed to report this bill, without amendment. Bill 38-The Local Aut horities Election Amendment Act!Loi modifiant Ia

Loi sur /'election des autorites locales Your committee agreed to report this bill, with the following amendments, on division: THAT subsection 17 (2) of the Bill be amended (

a) by striking out "clause 2(

a) and" in the

section heading; and (

b) by striking out "Clause 2(

a) and sections" and substituting "Sections". THAT the heading of the

Schedule to the Bill be replaced with the following:

SCHEDULE (Section 14) Bill 43-The Auditor General Act/Loi sur le verificateur general Your committee agreed to report this bill, without amendment. Bill 48-The City of Winnipeg Am endment (Pensions) Act/Loi modifiant Ia

Loi sur Ia Ville de Winnipeg (regime de pension) Your committee agreed to report this bill, without amendment. Mr. Schellenberg: Mr. Speaker, I move, seconded by the honourable Member for Radisson (Ms. Cerilli), that the report of the committee be received.

3378 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 200 1 Motion agreed to. * (1 3:45) TABLING OF REPORTS Hon. Ron Lemieux (Minister of Culture, Heritage and Tourism): I rise today to table The Freedom of Information and Protection of Privacy Act, 2000 Annual Report. Hon. Oscar Lathlin (Minister of Conservation): Mr.

Speaker, I am tabling today three documents, the first one being the Round Table Report and Recommendations on Mani toba Sustainability Indicators; secondly, a Provincial Sustainable Development Code of Practice; and, thirdly, a set of principles of Sustainable Development Financial Management and Guidelines. ORAL QUESTION PERIOD Antigang Strategy Government Commitment Mr. Stuart Murray (Leader of the Official Opposition): Mr.

Speaker, first off, I would like to applaud the work of the Winnipeg Police Service for their dedication to making our community safer, including the recent arrests of four gang members in relation to recent shootings and today's charges against a member of the Hells Angels in connection with a stabbing last Friday. The police have done a tremendous job, unlike the Doer government who, after nearly two years in office, has failed to keep a key election promise. The Premier at that time said: We promise to keep our communities safer.

Over the weekend, a home in Winnipeg's West End was fire-bombed and there was a home invasion in Selkirk. The violence continues under the Doer government. Why has the Premier not taken action, and why has he failed to implement more than half of his 18-po int gang action plan? Hon. Gary Doer (Premier): I, too, want to applaud the police forces, whether they be the Winnipeg police forces or other police forces working across and around Manitoba.

The situation is that there are a number of bills before this Legislature, including a bill to deal with the unacceptably high numbers of car thefts, increasing the penalties for individuals prosecuted and convicted of car thefts. In addition we have a bill, The Liquor Control Act, also- Some Honourable Members: Oh, oh. Mr. Speaker: Order. Mr. Doer: Thank you, Mr. Speaker. We also have amended The Liquor Control Act to increase the responsibilities of hotel owners and licensees for the safety of citizens in the parking lot.

We are looking at other ways, under Bill 10 and the new federal law, to continue to give the police more tools to deal with unacceptable violence in our community. Mr. Murray: Well, Mr. Speaker, in spite of all the rhetoric we hear, Manitobans are fearing for their lives. They do not feel safe. Press releases may get the Premier a headline, but they are not making our community safer. Why is the Premier breaking his promise to do everything he can to stamp out gang activity here in Manitoba? Mr. Doer: Mr.

Speaker, I have already answered a question last week on the matter of gang houses and their locations and requiring greater legal abilities to deal with those houses that are in our neighbourhoods. We have applied a specific Crown Prosecutions branch in terms of the gang activity. They are working obviously with the law enforcement agencies. We certainly want to see the federal Criminal Code be tougher, have more implementation ability than the existing Jaws. We are passing Bill 10 , dealing with booze cans and houses of prostitution.

We are systematically changing and amending laws to give the police more tools to deal with unacceptable violence in our community. Mr. Murray: Mr. Speaker, the First Minister says that they are expecting the federal code to

July 3, 200 1 LEGISLATIVE ASSEMBLY OF MANITOBA 3379 be tougher. Manitobans are expecting that Government to be tougher. Mr. Speaker, a national story described how Winnipeggers are bracing for a summer biker gang war after three men in one week-three men in one week-were shot on our streets. Residents are on edge. Children are fearing that they might get hit in the crossfire. Why is the Premier standing by as gang violence, shootings, fire bombings and other violent acts such as home invasions persist in Manitoba? Mr. Doer: Mr.

Speaker, I have already outlined a number of amendments and improvements we are making in the laws of Manitoba that build upon the laws when we took office. We have a separate creation of a Criminal Organization Unit with specialized prosecution and supervision of high-risk offenders. That operation is currently in place. We have prov ided more money and more funds for the RCMP in Manitoba that co-ordinate the activity of gang surveillance on a national basis. We have increased the number of officers over and above what was there when we came into office when members left office. We are amending Bill 10 .

We are amending The Liquor Control Act. We are amending laws systematically to increase protection for the people. * (1 3:50) Private Health Care Clinics Government Position Mrs. Myrna Driedger (Charleswood): Mr. Speaker, the Doer government would like us to believe that private clinics cause longer waiting lists and result in higher health care costs. Well, this is simply not true. Can the minister explain why in France, where they have a collaboration of public and private health care systems, they have absolutely no waiting lists and in fact think that a waiting list of two weeks is very long?

Can he explain how that can possibly happen? Hon. Dave Chomiak (Minister of Health): Mr. Speaker, first off, in Manitoba we have had studies by the Manitoba Centre for Health Policy and Evaluation, an organization set up by members opposite, a study undertaken by mem bers opposite, done in Manitoba, that shows that not only do the waiting lists go up but it causes more difficulties when you operate private beside public. We have the experience in Alberta where the Alberta Consumers' Association outlined, in fact, that waiting lists went up and costs were more expensive when you ran private beside public.

They do not have studies, Mr. Speaker. All they have is France, a country where you pay user fees, and that is clearly where members opposite want to go. Mrs. Driedger: Is the Min ister of Health aware that the Montreal Economic Institute, in a research paper completed September 2000, stated the following: Canada's prohibition of voluntary parallel private health insurance and private medical services in hospitals precludes any Canadian-based comparison and control for the current experiment in provincial government health insurance policies? Mr. Chomiak: What I do know, Mr.

Speaker, is when the former governm ent tried to privatize home care and said it would save $10 million, not only did the public indicate they were not in favour of privatizing home care, but it cost more money to privatize home care by their own example. So I do not need examples from France, where they charge a 10% or 20% user fee. We have examples in Canada that show it is a difficulty and a problem. It is very clear that they want for-profit hospitals. We are protecting medicare. Mrs.

Driedger: I wonder if the Minister of Health could explain then how a year ago he signed a contract for private home care services, and that seems to blend okay because these private home care services are offered through the WRHA, and he signed a contract for them last year. How does it work there and he does not see the same kind of opportunity existing in clinics?

3380 LEGISLATIVE AS SEMBLY OF MANITOBA July 3, 200 1 Mr. Chomiak: As I have explained on many occasions to members opposite during Esti mates, we renewed a number of contracts. It is a backup contract for home care. We renewed them and we are continuing to renew contracts that were entered into by members opposite, Mr. Speaker, because we want to be pragmatic. But what we want to do is we do not want to go steadfast as members opposite would say. Members opposite want for-profit hospitals. They want private clinics. We are saying we have a line in the sand.

We have a Manitoba solution that is innovative, will have some benefits of the private sector by rolling it into the public sector. The issue is very clear, Mr. Speaker. Members opposite when they were government tried to privatize home care. The public was very clearly against it. We are not in favour of that. We are in favour of innovation that would see the development of our public sector to provide more services within the public context, which we believe is what Manitobans want. Election Finances Act Amendments Mr.

John Loewen (Fort Whyte): Under the guise of introducing legislation that would promote fairness in the election process, last year the Premier introduced Bill 4, which is not only unconstitutional but which through

section 44 will force Manitobans to contribute to regis tered political parties through their tax dollars. Interesting that he did not even mention that

section when he introduced the bill into this House. Does the Premier not feel that Manitobans are wise enough to choose whether or not they want to support any particular poli tical party? In fact, does he not give them enough credit for being able to choose which party they will support? Does he really believe that they must have government tax dollars to keep it going? Hon. Gary Doer (Premier): I think the public are very wise, and they were particularly wise on September 21, 1999. * (13:55) Mr. Speaker: Order. Just to remind all honourable members that the clock is running. Mr.

Loewen: Obviously, the Premier does not want to touch this part of his hidden agenda. The Premier and his Cabinet surely must have a better use for the close to $100,000 that will be distributed to political parties. Surely that money could be spent on improving health care or maintaining and restoring safety in our streets. Mr. Doer: I recall the debates of yesteryear when members opposite promised that under the elections finances law they would not take any money under the changed election laws. I think the tally is over a million dollars that the Conservative Party has taken, Mr. Speaker. Mr. Loewen: Mr.

Speaker, I would ask the Premier: Is the NDP so hard up for ideas to raise funds from their political allies that it has to resort to using taxpayer dollars to fund their political agenda, or in fact are they just lazy socialists? Mr. Doer: Mr. Speaker, getting a lecture from Tories on election tactics is like expecting a buzzar d to say grace before meals, with all credit to Sterling Lyon for another use of the same term. The report deals with the portion of the savings under the new elections law.

These savings were calculated not by the Government but by the Department of Finance in terms ofthe corporate donations and the tax deductibil ity of those. I have not even read the report from the Chief Electoral Officer. There is no decision- An Honourable Member: It is your bill. Some Honourable Members: Oh, oh. Mr. Speaker: Order. Mr. Doer: Mr. Speaker, there has been no decision made on the recommendations from the individual, the Chief Electoral Officer. Point No. 3: We felt it was important to proceed into the future with banning of union and corporate donations.

When you look at the United States and the big debate going on, the

July 3, 2001 LEGISLATIVE ASSEMBLY OF MANITOBA 3381 McCain-Finegold bill and other activity, we believe in Canada, as well, that having a political system over the long haul that is free of the perception of influence is a noble goal and one which we are committed to. Whitemud Watershed Disaster Assistance Mr. Glen Cummings (Ste. Rose): My question is for the Minister of Government Services. Again, for the second time this year, the Whitemud Watershed has gone on a rampage. My question to this minister is these com munities have already suffered considerable disaster.

They have lost roads, bridges, culverts huge bills to which they have not had clear direction from this minister as to any relief that may be available. When will they know whether or not, the first disaster, they will get any assistance? Hon. Steve Ashton (Minister of Transportation and Government Services): Mr. Speaker, I have reported to the House on a number of occasions that we have recognized the difficult situation many Manitobans face going back to last fall with excessive moisture, and again this spring.

In fact, I indicated in the House a short while ago that we anticipate being able to make an announcement very shortly on that. In fact, I am sure the member will find that we will in fact be in a position to provide the assistance that is available under Disaster Financial Assistance to the many Manitobans in that area of the province and many other areas of the province that have been affected by disasters and emergencies in the last several months. Mr. Cummings: Well, Mr. Speaker, this is cold comfort when that is just about the same answer that this minister gave twice before.

That was in April and May that they suffered the damage. They have again had their roads washed out, and they still do not know if they will get any assistance. When will he deal with this problem? Mr. Ashton: Mr. Speaker, we have been dealing with this problem. In fact, the first concern of EMO, including this weekend, is to get in, get on the site, work with Conservation, work with local governments through the front line in terms of emergency services. So we have been dealing with the situation.

The first priority was to deal with the emergency, and we are now going to be very shortly in a position to be able to announce compensation under the Disaster Financial Assistance program. * (14 : 00) Mr. Cummings: Mr. Speaker, when a community of a very small population has hundreds of thousands of dollars worth of damage, every decision that council makes hinges on whether or not they know they can be backed up by the provincial government in getting the support they need. When will he address it? Mr. Ashton: Mr. Speaker, once again, we have been addressing it.

The first priority was to respond to the emergency. We have had EMO people out, in fact, working around the clock in many situations, along with other departments of government. Whether it be Conservation or highways, we have been out there. As I indicated to the member opposite, we are still in fact receiving applications even from this weekend from another community affected by disasters. He should anticipate an announce ment very shortly on this. But our priority, once again, is to deal with the emergency first and then deal with the compensation afterwards. R.M. of Stuartburn Drainage Plans Mr.

Jack Penner (Emerson): Mr. Speaker, my question is to the Mini ster of Conservation. Attending the Canada Day celebrations in Vita this last weekend, I met many, many people in that area that were not very happy on Canada Day. The reeve of the municipality tells me that 90 percent of the arable land in the municipality of Stuartburn has not been seeded this year. The reeve also told me that many people were not

3382 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 2001 aware that they could sign into a Crop Insurance non-seeded acreage program. The question is to the minister. Can the minister tell me when the plan that was supposed to be drawn for drainage projects in the R.M. of Stuartburn will be tabled, and when will he initiate the plan for drainage in the R.M. of Stuartburn? Hon. Oscar Lathlin (Minister of Conservation): Mr. Speaker, I can indicate to the member, as I have done on previous occasions, that we have reviewed the rather huge challenge that we have in the area of drainage for municipalities, farmers and so on.

We have injected some new money into the drainage budget this year. At the moment, plans are being finalized to allocate the funds, knowing full well that whatever we allocate will not address the full situation that was left there by the previous government. Mr. Jack Penner: Mr. Speaker, as the minister knows if his department has briefed him, as I am sure they have, there is water coming across the U.S. border into the R.M. of Stuartbum. It comes cross-country, and there needs to be a drainage plan done in the R.M. of Stuartburn. There was a road built by the Pawley administration or by the- Mr. Speaker: Order.

Point of Order Hon. Gord Mackintosh (Government House Leader): Mr. Speaker, would you please remind the member, who I am sure knows this full well, that a supplementary question requires no pre amble. Thank you. Mr. Speaker: On the point of order raised by the honourable Government House Leader, I would like to take this opportunity to remind all honourable members, Beauchesne's Citation 409(2) advises that a supplementary question should not require a

preamble. I would ask the honourable member to please put his question. * * * Mr. Jack Penner: Thank you very much, Mr. Speaker. I will ask the question of the minister. When is he prepared to go out to Stuartbum and explain to the municipality of Stuartburn and the people in Stuartburn how he will remediate for damages that his inaction has caused to the farmers in that area, and when will he put in place a drainage plan that he promised last fall to the people ofthe R.M. ofStuartburn? Mr. Lathlin: Mr.

Speaker, we on this side of course recognize that the issue of drainage is an important concern for those producers, those residents and municipalities, especially through out southern Manitoba. Their concerns are valid, and I might say that they have been voicing those concerns for many years to their previous governments and nothing had been done. We are trying our best to address the situation with the resources that we have. Mr.

Jack Penner: I want to ask the minister whether he is aware that his department sanctioned the closure of six culverts which has flooded huge areas of land, which is against the law, and closed off natural drainages, whether he is aware of the damage that has been caused. Has he been given an estimate yet by the muni cipality of Stuartburn and by the people of Stuartburn as to the total amount of damages caused by the action of his department? Mr. Lathlin: I recognize that the work of Conservation with respect to addressing the drainage problem is a huge problem.

I remember during Estimates last year the Member for Pembina (Mr. Dyck) advising me something to the effect that Conservation is faced with a very difficult problem in that a substantial amount of the budget had been cut from the Department of Natural Resources over several years. In fact, after 11 years of Tory government, Mr. Speaker, that budget had been reduced from about $20 million to about $5 million. That explains why we are having to deal with some of those very issues today. Eaton's Building Sustainable Development Issues Hon. Jon Gerrard (River Heights): Mr.

Speaker, my question is to the Minister of Conservation. Today the minister tabled Mani toba's Provincial Sustainable Development Code

July 3, 2001 LEGISLATIVE ASSEMBLY OF MANITOBA 3383 of Practice, a practice which includes meaningful opportunity for public consultation and due process and ensuring the assessment of proposed programs and projects are carried out to determine and address their sustainability impact. I would ask the minister if he is planning to use his code of practice to assess one of the most significant projects of today, that is the demolition of the Eaton's building and the construction of the new arena. Hon.

Oscar Lathlin (Minister of Conservation): can indicate to the member that the code of practice report was tabled today and, effective immediately, government depart ments through a structure of officials will be looking at the various indicators with a view to maybe clarifying or refining and maybe even adding on some other indicators where the report might have been deficient, as the Manitoba Round Table has told us in their report. The Manitoba Round Table has advised, has recom mended to Government that we go back and conduct more consultation with respect to Aboriginal people and youth.

So that is what we will be doing for the next year or so. Mr. Gerrard: Mr. Speaker, my question to the Minister of Conservation is whether he will use the report on the code of practice, which he has tabled today and said is effective immediately, as part of his basis for assessing the sustainable development issues which surround the demolition of the Eaton's building and the construction of the new arena. Mr. Lathlin: I can indicate to the member again that we have accepted the reports and we are tabling them today. We are going to be implementing them as- Some Honourable Members: Oh, oh. Mr.

Speaker: The honourable Member for River Heights. Mr. Gerrard: Mr. Speaker, my supplementary. I assume the minister is not going to not follow his code of practice, so I will ask the minister: When is he going to start the assessment of the demolition of the Eaton's building and the building of the new arena under the terms of his code of practice? Hon. Gary Doer (Premier): Mr. Speaker, well, this policy applies across all of government, as the member opposite knows.

Section 9,

section 11 and

section 12 have applications for the Department of Conservation and all of govern ment. The member should recall that on Thursday, when the member first asked the question on this issue, the Minister of Culture (Mr. Lemieux) tabled a document from Mr. Tom Carson, the Deputy Minister of Culture, Heritage and Tourism. In the re-use potential

section on page 2 of the report it says: When considering possible locations for a downtown campus of Red River College, Manitoba Transportation, et cetera, evaluated the Eaton's store, the Princess block and the site ofU ofW. In other words, they talked about a number of re-use possibilities over the last 18 months. The report described the Eaton's building as poorly suited for conversion to a 21st century learning centre. So the whole issue of sustain ability has been considered all the way throughout the decisions on the proposed new True North complex. Red River Dredging Mr. Edward Helwer (Gimli): Mr.

Speaker, recently there was a barge stuck in the Red River trying to go from Selkirk to Lake Winnipeg. The water was only three feet deep in some places at the mouth of the river. The river needs to be kept open for navigation purposes and also for the fishing industry, both sport and commercial fishing. Will the Minister of Conservation today commit to getting his federal counterparts to undertake the needed dredging along the Red River? Hon. Oscar Lathlin (Minister of Conservation): Mr. Speaker, I apologize for not getting the question. I had difficulty hearing and I am trying to find my- Mr. Helwer: Mr.

Speaker, I will repeat the question again for the Minister of Conservation. Will the minister today commit to getting his

338 4 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 200 1 federal counterparts to undertake the needed dredging along the Red River? Mr. Lathlin: I thank the member for the question. Let me advise the member I will look into that situation and report back to him before the week is up. * (1 4:10 ) Mr. Helwer: Mr. Speaker, many of the channels that are leading into Lake Winnipeg are being silted in.

Will the minister explain what steps will be taken to ensure the heavy silting along the channels of both the Red River and Netley Creek and some of the other channels at the mouth of the Red River so that that does not lead to increased risk of flooding? Mr. Lathlin: Mr. Speaker, as I indicated to the member already, I will review the situation he has raised here today. I will be in contact with the federal government with a view to coming up with a positive response for the member before the week is up. Selkirk/Gimli Docks Dredging Mr. Edward Helwer (Gimli): Mr.

Speaker, the docks at both Selkirk and at Gimli are silted in so bad that they are rendered useless by many in the shipping industry. Will the minister commit to dredging the docks at both Selkirk and Gimli so that the freight can be shipped by barge through northern Manitoba? Hon. Oscar Lathlin (Minister of Conservation): I am sorry, I am just going to have to repeat my response to the member. I will be in contact with the federal government with a view to maybe getting some assistance from them in order that we can address the situation in Selkirk. Rural Municipalities Drainage Projects Mr.

Jim Penner (Steinbach): My question is to the Minister of Conservation. The Southeast Water Management Association, an organization comprised of 16 Manitoba municipalities, has indicated that simple drainage ditches that alleviate flooding from farmland are not being built because of the demand by officials of the federal Department of Fisheries and Oceans for information on possible fish habitats in these ditches, these ditches which remain dry most of the year. Can the Minister of Conservation indicate what assistance staff in his office have provided Manitoba municipalities to alleviate this prob lem? Hon.

Oscar Lathlin (Minister of Conservation): The member is absolutely correct. The federal government, some time back, made a unilateral decision with respect to placing. I believe it was 40 positions in Mani toba. Mr. Speaker, 20 of them were located here in Winnipeg and I believe the other 20 were located in Dauphin. Our officials have been in meetings with the federal officials with a view to getting the federal government to change some of the directions that it has taken.

I know that it has placed a lot of people in a very difficult situation, and it is our hope that through our meetings with the federal government we can get some co-operative action together. Mr. Jim Penner: Mr. Speaker, we need some action. Can the minister indicate how munici palities are expected to bear the increased costs associated with supplying what municipal offi cials have described as ridiculous information when in some cases it is making a $10,000 drainage project into a $40,000 project? Mr. Lathlin: Mr.

Speaker, again I want to indicate to the member that I take the issue very seriously, because I note that it affects the people in the communities in a very serious way. That is why we are so determined to continue our discussions with the federal government and hopefully they will change the direction that they have taken in Manitoba. Mr. Jim Penner: We need some kind of an action. Can the minister today commit to contacting the federal Fisheries Minister directly to negotiate an end to this problem and to report this back to the House? Mr. Lathlin: Mr.

Speaker, in fact, meetings have already been held by our officials meeting

July 3, 2001 LEGISLATIVE ASSEMBLY OF MANITOBA 33 85 with the federal officials, and hopefully we will be in a position to indicate to the member as to whether the federal government is in a position to change its direction that it has recently taken. St. Norbert Flood Protection Mr. Marcel Laurendeau (St. Norbert): Mr. Speaker, my question is for the Premier. Within my constituency, we have some concerns about the potential of flooding and about claims that have not been paid in the past. When we read in the newspaper that the Minister of Government Services (Mr.

Ashton) wants to install new bells, that the Minister of Government Services is installing new carpets and that this Premier wants to fund political parties, can he tell us where his priority is? Will he help the people of St. Norbert who have been attempting to get this money now for the past few months? Will he assist us in receiving the money that is due to the people of St. Norbert? Hon. Gary Doer (Premier): Mr. Speaker, I suppose rhetorically one could ask about the regrettable situation of Isobord and the $15 million that we had to deal with coming into office.

Having said that, the member did ask a question dealing with his residents. As I recall the sequence, the vote on protection in the area that the member opposite has raised is scheduled to be completed at the end of June. We should know the results shortly on the various options that are proposed. Secondly, Mr. Speaker, there is a concern about how much money has been spent and if all the allocation has been spent under the Canada Manitoba city agreement.

I can assure members opposite, when you look at $82 million in the provincial Budget for flood protection, flood protection is a very high priority for, I know, members opposite and for this side as well. Mr. Laurendeau: Mr. Speaker, can the First Minister then explain why it is more important for bells to have a better sound, why we need a carpet at the bottom of the stairs, why we have to support political parties, when the people of St. Norbert have been asking for this money to be received?

Why is it that the Premier sees it more important to fund political parties than he does to support the people in my constituency who need the flood protection? Mr. Doer: The member opposite is part of a political party that campaigned in 1986 against receiving funds from Elections Manitoba. I think the tally is at least $450,000 they received in the 1995 election alone, filing from one political party that they filed in that election campaign. Having said that, Mr. Speaker, the issue in his constituency is serious. I do not think it should be juxtaposed against the bells.

I am not aware of any decision that was made on the bells. An Honourable Member: How about the carpet? Mr. Doer: Well, Mr. Speaker, that heraldic design that is now adopted in this Legislature, some of us actually voted against that heraldic design, if I recall correctly. I do not want to tell the member opposite how many dollars were spent by the previous government changing everything from the former heraldic design to the present heraldic design that was brought in by members opposite. Having said that, Mr. Speaker, I voted against it, but I am just an old-fashioned person.

I am not aware of the results of the optional vote that took place in the member's constituency. As I understand it, Conservation usually allows a 24-hour grace period for all the ballots to be in or all the votes to be taken and then will inform us. I am sure the member opposite is aware of the views, but the first decision starts with the people in his constituency, and I know he respects that process as well. Mr. Speaker: Time for Oral Questions has expired. MEMBERS' STATEMENTS Commander Ivan Poitras Mr. Frank Pitura (Morris): Mr. Speaker, on June 3, 2001, I had the privilege of attending a

3386 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 2001 decoration day at Morris to recognize Commander Ivan Poitras, who has recently retired from the Canadian Forces. * (14:20) Commander Poitras has served in numerous peacekeeping missions and is a representative of the Manitoba

Chapter of the Canadian Associ ation of Veterans in United Nations Peace keeping. Individuals such as Commander Poitras remind us just how crucial a role Canadian peacekeepers serve around the world each day. Since the first peacekeeping force was created in 1956, in response to the Suez crisis, more than 100 000 Canadians have participated in United Nations peacekeeping duties. Canada honoured its peacekeepers through the dedication of a monument, which was unveiled in Ottawa in October 1992.

Manitoba also recently recognized the important work of peacekeepers by proclaiming August 9, 2000, as Peacekeeping Day. Currently, there are some 2500 Canadians serving in operations. I would like to personally congratulate Commander Poitras on his retirement and on his outstanding career, as well as all Manitobans past and present who have served in peace keeping missions abroad. Thank you. Sperling Centennial Mr. Daryl Reid (Transcona): Mr. Speaker, 100 years ago signalled the official start of a rural community nestled between Brunkild and Carman just northwest of Morris.

In 1901, Sperling, Manitoba, became a noted Manitoba community. This past weekend, I had the opportunity to attend Sperling's 1 OOth birthday celebration. This centennial homecoming started with the parade on Saturday morning, June 30. The parade was led through the community by St. Andrews Society Pipe and Drum Band, followed by many floats and antique vehicles of all shapes and sizes, including the M.P. for Provencher and the MLA for Morris (Mr. Pitura).

Also, the Transcona and District pipes and drums youth band were proud participants in the Sperling parade, showcasing their talent to many hundreds of route spectators. The parade wound its way from Station Street to Main, then to Henry, onto New Street and back to Station Street. Spectators were very supportive and warmed by the parade participants, despite the very cool morning. Visitors came from as far away as California and from many communities in Manitoba to participate in Sperling's 1 OOth birthday cele bration. After the parade, all were welcomed back to the community hall and refreshment tent.

Displayed in the community hall were many items of remembrance from the community's 100-year history, including pictures of signi ficant events in and of the community, including families, family special celebrations and sports teams. Also on display were curling sweaters from championship teams and pictures of several local hockey teams from over the years. I am sure that all members of the Legislature join with me in congratulating the residents of Sperling, Manitoba, on their first 100 years. This is a proud Manitoba community with a proud history. We wish them all well in their next 100 years. Thank you, Mr.

Speaker. Saskferco Products Incorporated Mr. Denis Rocan (Carman): I am pleased to rise before the House this afternoon and put a few words on the record about a grand opening in the Carman constituency which I had the pleasure to attend and speak at on June 28, 2001. Regina-based Saskferco Products Incorporated has opened a new fertilizer storage facility in Carman. Saskferco is well known as North America's largest producer of granular urea and anhydrous ammonia. This new facility will enable the company to better serve its customers in the Red River Valley, both in Canada and the United States.

It will house 80 000 metric tonnes of granular urea for timely and efficient local and international distribution. It is this type of vision that has made this company so successful in the global marketplace.

July 3, 2001 LEGISLATIVE ASSEMBLY OF MANITOBA 3387 This new facility provided excellent opportunities for the people who were employed during the construction phase, which began nearly one year ago, and those who will be involved in the plant's daily operations. The greatest benefit, however, will be for Manitoba producers who will be the end consumers of these fertilizer products. They can now be assured of secure, local fertilizer stocks capable of meeting peak demand periods.

I and my constituents would like to welcome Saskferco into Manitoba and wish them every success in doing business with friendly Mani tobans. Thank you very much, Mr. Speaker. Canada Day Celebrations Mr. Stan Struthers (Dauphin-Roblin): The July long weekend in the Parklands is always a very busy, busy weekend. I know that the Minister of Industry, Trade and Mines (Ms. Mihychuk) and the Member for Gimli (Mr. Helwer) will agree with me that there were many, many events to be attended in our area.

I saw the minister at our ag society fair and at Countryfest, and I had a chance to speak with the Member for Gim1i at Countryfest as well. I appreciate their support of our ongoing com munity efforts. Other events that we had a multitude of in our Parkland area were Canada Day celebrations in Rorketon, and in Dauphin, Gilbert Plains and Grandview. Mr. Speaker, I specifically want to talk a little bit about the Canada Day celebration that they organized in Roblin.

The Roblin recreation commission and the economic development committee joined forces with Mayor Lome Boguski and his town council to have an excellent day of celebrations and an excellent contribution to Canada Day celebrations in our country. I want to particularly mention Jana Watt of the economic development committee, and Lance Vaillancourt [phonetic] of the rec commission for their work in organizing the Canada Day celebrations. The committee sponsored everything from church services to pie auctions and eventually pie throwing, to ball games.

There were many local bands that performed at Curey Park in Roblin and finished off the evening with fireworks after it became dark. · I had the pleasure to present at Roblin that day the Canada Youth A ward to a young lady by the name of Nicole Branconnier, who is the president and VP of the 4-H, a member of the Big Sisters and Little Sisters, and she also volunteers at the recycling depot. So thank you very much, Mr. Speaker. Provincial High School Track Meet Mr. David Faurschou (Portage Ia Prairie): Mr.

Speaker, it gives me great pleasure to rise in the House today to recognize the hard work of athletes from Portage la Prairie who once again brought home the gold. I rise today to congratu late them on their outstanding performance in the 2001 Provincial High School Track Meet. Whitney Blight of Portage Collegiate Institute won the junior girls discus with a throw 31.54 metres, an improvement of several metres over her performance in the rural provincials. Joey Patsack of Arthur Meighen High School took first place in the junior boys 100 metre hurdles.

This victory was even more impressive due to the fact that Joey was unable to train prior to the meet due to an injury. In addition to these two gold medalists, Daniel Narvey, in an outstanding effort, brought home medals in three separate events. He earned a silver medal for the junior boys 1500 metre run, a bronze medal in the 3000 metre run and another bronze in the 800 metre. Benson Stobie also won a bronze medal for his performance in the junior boys discus.

I would also like to recognize Chris Caister for his seventh place finish in the 400 metre, and Ali Bouchard also placing seventh in the junior girls shot-put. Mr. Speaker, bravo to all the athletes who participated in the 2001 Provincial High School Track Meet, and a special congratulations to all those who reached or surpassed their personal goals in that attendance. Thank you, Mr. Speaker.

3388 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 2001 ORDERS OF THE DAY House Business Hon. Gord Mackintosh (Government House Leader): Mr. Speaker, would you please seek leave of the House for an Opposition Day to be held tomorrow to consider the Opposition motion that is on today's notice paper? Mr. Speaker: Is there leave of the House for an Opposition Day to be held tomorrow to consider the Opposition motion that is on today's notice paper? [Agreed] Mr. Mackintosh: Mr.

Speaker, would you also seek leave of the House to not see the clock tonight at 6 p.m. until 8 p.m., and for the two standing committees to sit concurrently with the House this evening, and also ask if there is leave to waive the quorum requirements for today? Mr. Speaker: Is there leave of the House to not see the clock at six o'clock until 8 p.m., and for the two standing committees to sit concurrently with the House this evening? Also, is there leave of the House to waive the quorum requirement for today? [Agreed] Mr. Mackintosh: Mr.

Speaker, would you please call debate on second readings No. 28, and then call second readings No. 47? * (14:30) DEBATE ON SECOND READINGS Bill28-The Labour-Sponsored Investment Funds (Various Acts Amended) Act Mr. Speaker: Resume debate on second reading of Bill 28, The Labour-Sponsored Investment Funds (Various Acts Amended) Act, standing in the name of the honourable Member for Morris (Mr. Pitura). Is there leave of the House for the bill to remain standing in the name of the honourable Member for Morris? Some Honourable Members: No. Mr. Speaker: Leave has been denied. Mr.

Mervin Tweed (Turtle Mountain): I am pleased to take a couple of moments just to put some comments on the record in regard to the bill. We did have the opportunity of a briefing from the department on Thursday. I think, Mr.

Speaker, that the concerns that we have expressed at the start of this, when the bill was first brought forward, I think it is important that we do lay out a bit of the history of this, and the fact that this bill was brought forward after the fact when they found out, when the Government discovered, that they could not support the arena project with the Crocus funding without some changes to the labour-sponsored bill.

I guess from this side of the House we find that despicable, that governments would get themselves into a position where they found that they could not work within the guidelines that were already out there. It is quite obvious that this is the way the Government of the day in Manitoba operates, as they continually find that the rules that they are set up to work within, if they do not like them, this Government makes two choices. They choose to ignore them, or they choose to change them. In this case, they have done that.

What they have done is they have opened up the investment capabilities of the labour sponsored funds to include facilities such as the Winnipeg Arena, which would not have been allowed without these changes under the old guidelines. It is really purely a defensive mech anism. When they found out that they were caught and could not make it happen without these changes, they brought forward the legis lation.

I think there have been words thrown around back and forth from both sides of the House, but certainly the loan that was being prepared and offered to True North would have been ineligible based on the previous rules and regulations of the past labour bill. So again what this Government does is, if they do not like a rule, they change it or break it. We are seeing it again in a presentation that we are seeing in this bill. Mr. Speaker, we are prepared to pass this on. I know a couple of my colleagues want to

July 3, 200 1 LEGISLATIVE ASSEMBLY OF MANITOBA 338 9 make a couple of comments. But the list is becoming unending as far as what this Govern ment does to have their way. They tend to strong-arm everybody through the process and change rules or break rules, break laws as we go through. We will be eagerly awaiting the com mittee hearings and further comments back here after that. Mr. John Loewen (Fort Whyte): Mr. Speaker, Bill 28 will go forward to committee. As we heard, it is a bill that the primary purpose is to change the legislation regarding the Crocus Fund.

The primary purpose of that is to allow this Government to proceed with its hidden agenda, with its agenda to build a downtown entertainment complex. On a number of occa sions we have pointed that out in this House. Mr. Conrad Santos, Deputy Speaker, in the Chair I think it is particularly interesting to make note of the sequence of events that took place regarding this bill. On May 9 I posed a question to the Minister of Industry, Trade and Mines (Ms.

Mihychuk) regarding the ineligible invest ments for the Crocus Fund, in particular their ability under the existing act to invest in real estate, which obviously an investment in the True North project would be. I pointed that out to the minister on that day. It was interesting that she did not really have an answer. She said she would take it under advisement and get back to us. We never did hear back from the minister.

I also pointed out to the minister that under The Securities Act, basically I felt that the investment that was being undertaken by the Crocus Fund and the True North project was in fact illegal. It was illegal because, in January, the Crocus Fund issued a prospectus which clearly stated within that prospectus that an ineligible investment would be one that involved an investment in real estate. It also states quite clearly in that prospectus that the Crocus Fund will not invest in any project where the assets exceed $50 million.

That is what the fund was designed for, designed to make smaller investments in small cap equity companies, growth companies, turn arounds of that nature to create jobs; not to invest in real estate and not to invest in projects that had assets of more than $50 million, both of which the True North project falls under. In addition to that, The Securities Act quite clearly states under

section 136 that any organi zation that issues a prospectus, and then raises funds, and, subsequent to that, turns around and uses those funds for purposes that do not coincide with the issuance of the prospectus and the terms thereof, does so under the threat of a fine of up to $1 million. In fact, that is what the Securities Commission could rule should they choose to look into this potential investment by the Crocus Fund. I am confident that this Premier (Mr. Doer) and his Government were aware of that. They stated that they had been in negotiations behind closed doors for over 18 months.

Surely the Premier and surely his Government must have been aware of the difficulties that would be involved with the Crocus Fund investing in a project that had more than $50 million in assets and investing in a project that primarily involved the leasing or rental of space as a means of deriving income.

Both clearly fall in the realm of the True North Project. * (1 4:40) But, instead of standing up in this House on May 9 and answering the question and simply telling the people of Manitoba, telling the elected officials that they believe the project was worthwhile and it should go ahead, to do it they were going to have to change The Crocus Investment Fund Act, the minister stood up in this House and said: Oh, no. I will take it under advisement. It does not go against the legalities or the spirit of the Crocus Fund, when in fact the Premier and his Government knew full well at the time that it did.

So what was their response? Well, their response was on May 14. You know, just five days later on a Monday, when I had asked the question on a Thursday. On the next Monday they introduced legislation into this House. Of course, they did not tell us what was in the legislation. They let it sit on the Order Paper for close to five weeks before they even released the legislation to this House. Then when they did it, they released the legislation on a Monday some

339 0 LEGIS LATIVE ASSEMBLY OF MANITOBA July 3, 200 1 six weeks later near the end of that particular day's session so that it would not attract attention. But they knew when they introduced the bill, just as they knew before May 9. They knew on May 14 that the primary purpose of this bill was to remove the

section of the Crocus act that identified what constituted an ineligible investment under the Crocus Fund. By doing so they changed the very nature of the fund. Basically, what they are saying is the fund now has carte blanche to invest in any organi zation in Manitoba.

The Government and the Crocus Fund should not have to be reminded that they have gone out in Manitoba and, on the basis of a very generous tax credit program, they have raised well over $1 00 million, probably at this point $1 75 million or close to $200 million, of funds from Manitobans, most of whom have put those funds in on the basis that they get a large tax credit and most of whom will be encouraged to put their investment in Crocus, in their RRSP fund, to maximize that tax credit. So they will receive in fact 80 percent of an investment less than $5,000 as a tax credit.

So the Crocus Fund has gone out year after year to raise this capital every year on the basis that they would not invest in real estate because if they did they stood the risk of losing that tax credit, which has certainly been one of the primary reasons that individual Manitobans have chosen to invest in that fund. They would not put that at risk, and so, year after year, they have gone out raising these funds on the premise that they are going to invest them in small cap Manitoba companies, that they are going to invest in turnaround situations that will create jobs in Manitoba.

Quite frankly, they have put out to the public on more than one occasion that Manitobans will receive an excellent rate of return. In fact, they have talked about a rate of return as high as 30 percent after you have allowed for the tax credit. So this is the type of fund it was structured for. It was a venture capital fund. People knew at the outset, when they put their money in, that that is what the corporation would be investing in.

They had confidence because this organi zation will be making a number of investments, and they will be balancing their risk of their portfolio and in high-risk venture capital funds. That is what has to be done. But now we have seen that change dramatically and within months of the Crocus Fund going out and raising close to another $30 million this year, maybe a little above, maybe a little below.

But I understand it is in the neighbourhood of $30 million raised, again based on the prospectus that was issued January 14 of this year, which clearly stated that they would not be investing in real estate projects and they would not invest in projects that had assets over $50 million. This Government is driving the agenda, it is obvious, behind the True North project. It is this Premier, the mayor of the City of Winnipeg, Mayor Murray, who were the primary drivers behind the construction of a new arena.

Quite frankly, this bill that we have before us, Bill 28, demonstrates to what lengths they will go to drive this project through. In fact, they are willing to put their own ministers in a com promised position. They are willing to see the people who run the Crocus Fund put in a compromised position, all on the basis that I am sure, at some point during the last 18 months, the Premier has said to the Crocus Fund, who have been involved in these closed-door negotiations, not to worry about it. Do not worry. We will simply change the legislation.

We will remove any reference to ineligible investments, and you will be able to do what you want. So just come along with us and do not worry about it, because we will fix it. That is a characteristic that we have seen a number of times with this Government. Even the Minister of Education has done that and was chastised for it by the Auditor when he advised the Pension Fund to break the law on the basis that, well, we will just make a change to the legislation.

We have seen the same thing with regard to Manitoba Hydro when they talk about rate equalization throughout the province, which is a good thing, but instead of taking it to the Public Utilities Board, which Manitoba Hydro was fully prepared to do, they said, no, do not worry about that. We will just change the legislation so you can do what you want. Then, by the way, we will just, in their case, go back to the old legislation because we just want to do it one time.

July 3, 200 1 LEGISLATIVE ASSEMBLY OF MANIT OBA 3391 So I think, Mr.

Deputy Speaker, we see quite clearly that this Government has a hidden agenda, one that shows a great deal of disrespect for the laws of the province of Manitoba, an agenda which will allow them to instruct the management of the Crocus Fund to go ahead and propose an investment and make an investment in spite of the risk of losing their funds' ability to provide tax credits under The Income Tax Act, in spite of the fact that it goes directly against the prospectus that was issued on January 14 and in spite of the fact that, by doing that, the Crocus Fund and its senior management could be subject to a million-dollar fine under The Manitoba Securities Act.

So, Mr.

Deputy Speaker, during committee, we want to delve into the process to see what actually went on behind closed doors, why it was necessary for this Government to basically override the basic principles that led to the establishment of the Crocus, that led this Government, with a wink and a nod behind closed doors, to tell the Crocus Fund to go ahead and break the law; and by the way, when you do it, you might also have to stand up in public and declare that you really have not broken the law when in fact it is very, very obvious that the investment they have proposed in the True North project goes against the very principles of The Crocus Act which is being amended through Bill 28 before this House today.

I might also add that we saw recently in the newspaper reports and quotes from Mr. Kreiner, the head of the Crocus Fund, talking about their desire to invest in housing in downtown Winnipeg, Mr. Deputy Speaker, to help with their vision of revitalizing downtown Winnipeg. So, once again, we have the CEO of the Crocus Fund, in public, saying they want to make investments which are clearly against the principles of the act that is set out at this particular time, and he could have only done that had the minister, had the Premier (Mr.

Doer), again behind closed doors, said, okay, we are going to use the Crocus Fund not as a means of investing in venture capital, not as a means of providing jobs in Manitoba, not as a means of helping start-ups, of helping turnaround com panies, smaller, growing companies that need funding in Manitoba; we are going to use the Crocus Fund as an instrument of public policy, and you, sir, are going to invest in real estate.

You are going to come out publicly and say you are going to invest in real estate in spite of the fact that the act clearly states that any investment in real estate where a return is derived primarily from the leasing or from the sale of real estate means that it is an ineligible investment. * (14 :50) Mr. Deputy Speaker, ineligible investments can be made, but they can only be made as the law stands today with the prior written authority from the Minister of Industry, Trade and Mines (Ms. Mihychuk).

So if, once again, it is the policy of the Government to use the Crocus Fund as an instrument for public policy similarly as they tried to use the $30 million they took out of MPI ; similarly as they are using the extra $65 million that they have hauled out of Hydro this year and the $23 million they are using to build a northern road out of Hydro profits instead of using it as it was originally intended: to provide Manitobans with the lowest rates possible. -Here is just another example where they have said to the senior management of an organization and operation that they clearly control; they have said: do not worry about the law as it stands today; just go ahead and do what we are telling you to do, and we will change the law.

I hope that the Provincial Auditor, soon to be referred to as the Auditor General when we pass that act, I hope that he, in his capacity, will look as harshly on these activities as he looked on the activities of the Minister of Education (Mr. Caldwell) when he advised his pension board to, in essence, break the law simply on the understanding that at some point in time the Minister of Education would change the law. There is no difference here.

We have the Crocus Fund basically contravening The Mani toba Securities Act, contravening their own legislation which is in place today on a simple wink and a nod from the Premier and from the minister behind closed doors, that they should not concern themselves with it because the Government will simply change the law. Mr. Deputy Speaker, quite rightly, there are, I believe, a good deal of the 27 000 Manitobans who have invested in the Crocus Fund since its

3392 LEGI SLATIVE ASSEMBLY OF MANITOBA July 3, 2001 inception, there are a good number-and I have heard from a number of them-who are very, very concerned about this legislation, who are very, very concerned about the change in focus, a dramatic change that will take place in the investment practices of the Crocus Fund under this Government. I should remind this Government and I should remind the Premier (Mr. Doer) and I should remind the Minister of Finance (Mr.

Selinger) that these are Manitobans who have invested in this fund on the premise that the Crocus Fund would invest in high-risk start-up or turnaround situations that would create jobs in Manitoba on the basis that by their very nature some of those high-risk investments had the potential for turning very, very significant profits; something that one does not see from real estate, that one will not see from an investment in the True North project, that one will not see from investment in downtown housing.

At the same time that the Government is doing this, they also must recognize that they are restricting those 27 000 Manitobans from taking their funds out of the Crocus Fund because they have an eight-year hold from the time they invest until the time they are free, that they have their own liberty to take their own money out.

So I would urge the Government that if they are going to make, and this was another question I posed on May 14 during Question Period, if the Government, as a matter of public is going to make such a dramatic change to the Crocus Fund that in essence it changes the very nature of the investment in such a dramatic way that people who invest in it would want to think twice.

At the very least, this Government has the obligation to the people who have invested in this fund to say, okay, we have changed the nature of the fund, if you do not agree with it, redeem your portion of the fund at no cost, I mean, at today's share value, but without the loss of the tax credit that was given to them as a carrot to make the investment. Take those funds and invest in something that you are comfortable with. Because anybody who is managing their RRSP properly will have a mix of investment.

They will have some investments in bonds, they will have some investments in high risk, they will have some investments, hopefully, in blue chip stocks. But the whole idea of an investment for your retirement is to have a balanced approach to it. So many of those 27 000 contri butors to the Crocus Fund will have made it on the basis that this portion of their investment, hopefully, for their sake, was going into high risk venture capital funds, which, by the very nature of the fund, could understandably lose it all, or they could see a very, very high rate of return.

They certainly did not put that money in, up to this point, expecting this fund to invest in real estate. In fact, exactly the opposite. So this Government, with a stroke of the pen, behind closed doors, with a wink and a nod behind closed doors, has changed the nature of the Crocus Fund forever. We see management reacting to that. At the very least, I mean, our original premise is they should not tamper with it-period. The fund was set up to be a venture capital fund. The fund was set up to make investments in high risk. start-ups and tum around situations. Mr. Deputy Speaker, we see the balance sheet.

I mean, it is easy to look at the balance sheet and pick out another $40 million or $50 million of that $200-million fund that today is at risk and could very easily, on the opinion of an independent evaluation, be written off. That is the nature of the fund. That is why it was set up, as a venture capital fund and a high-risk fund. To change the nature of that fund to invest in real estate without giving proper notice would have been advice in the prospectus that was issued January 14, because this Government knew, this Premier (Mr.

Doer) knew, the minister knew by January 14 that they needed that Crocus Fund to solidify the investment in the new downtown entertainment complex; to solidify the prospects of going forward with the Premier's agenda, with the mayor's agenda in building an entertainment complex on the Eaton's site. Without the involvement of the Crocus Fund, this deal will fall apart. An Honourable Member: Are you for it or agin' it?

Juiy 3, 200 1 LEGISLATIVE ASSEMBLY OF MANITOBA 33 93 Mr. Loewen: The Premier asks am I agin' it or am I against it? Well, as I told the Premier the other day, I am for, have been for a long time, worked hard in '95-96 under different circum stances to see a new entertainment complex built in downtown Winnipeg. But I am also for truth and honesty. We do not have that in this process. We do not have that in this Chamber.

We have a minister of the Crown standing up and saying she does not understand, when in fact four days later-not even four days later-the next sitting day of this House, she introduced legislation to wipe out ineligible investments. Now, that is not open and honest government. All we asked of this Government, if that was the case they should have stood up on May 9 and said: we are going to change the Crocus act. We need to change the Crocus act because we have a project that we stand behind. But no, they hid behind it, and they brought in some other amendments.

We do not object to all the other amend ments which even out the investment policies of the Crocus Fund and the ENSIS Fund. In fact, in this House I argued a year ago that that should have been done when the minister introduced another piece of legislation over a year ago which basically took a very, very small step, a very timid step in its approach to equalizing the two funds. So, in terms of the equalization of the ENSIS Fund and the Crocus Fund in this bill, we think that is overdue.

But to hide that, to hide behind that, the fact that this Government is changing the very nature of the Crocus Fund, not to the benefit of the investors, not to the benefit of the 27 000 Manitobans who have made an investment in this fund, but to suit their own hidden agenda. They are using those 27 000 investors, their funds, their retirement funds, the money they are counting on. These are hard working, honest Manitobans.

They are counting on these funds to grow so, when they enter their retirement years, those funds will be there to support them. * (1 5:00) Well, I daresay, with this change in legislation, that quite likely may not be the case. So we would urge this Government, if it is their desire to change the legislation, to open up the Crocus Fund to be used as an instrument of public policy, to invest in projects like True North, to invest in downtown housing. We ask them to do it openly, and to do it honestly.

Because they chose not to do it that way, because they chose not to indicate that in their prospectus that was issued January 14 , we would ask them, through this legislation, to open the door to any Manitoban who may want to remove and redeem their shares in the Crocus Fund, to be able to do so now and to have a window of perhaps six months or eight months so that they could make an assessed judgment based on the new direction of the Crocus Fund and not only redeem this year's contribution but redeem any contribution that they have made over the life of the Crocus Fund, because that is how fundamentally this bill will change the nature of the Crocus Fund forever.

Mr. Speaker, we are anxious to get this bill moved on to committee. We will look forward to questioning the Government, and particularly the minister, on the exact reasons and some of the exact timing for the changes that have been brought forward to this House with regard particularly to the Crocus Fund. Thank you. Mr. Harry Enos (Lakeside): I have just a very few comments. My colleague the Member for Fort Whyte (Mr. Loewen) has very clearly laid out what, in fact, is happening here. I honestly believe that the Government and particularly the minister owe the Member for Fort Whyte an abject apology.

I can recall the Member for Fort Whyte raising this issue, it being just set aside as ill-founded Opposition criticism. I am deeply disturbed that it would appear that senior management with the Crocus Fund went along with the Government's program, and that bothers me, because these are the people, as the Member for Fort Whyte repeatedly pointed out-these are the stewards of 27 000 Manitobans who have chosen the Crocus vehicle for their investment, or a portion of their investments. I understand why, and you will see the reason why the winking and the nodding took place, because the Premier (Mr.

Doer), this Government, did not want to be up front saying, yes, legislation will have to be changed to accommodate this project within the Crocus Fund rules and regulations. That would kind of flavour the whole deal a little differently.

3394 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 200 I If you had to go in acknowledging that it was ineligible today, but we are a majority government, we had the power, we can change the legislation, that is what has happened with Bill 28. Far more importantly, Mr. Deputy Speaker, than the whole thing, and I am hoping we will have an opportunity to examine the managers of the Crocus Fund during committee stage of the bill, is this tinkling with the fundamental objectives of the Crocus Fund. That is where members opposite quite frankly, and I say that benignly, do not always know what they are doing.

They are changing a fundamental principle within the Crocus Fund that has been successful, that has attracted 28 000 investors and the dollars that are there. If you want to use it for other social programming within the department of government, then it has to be said up front and opportunities have to be provided for people to make an assessment as to whether they want to continue leaving their money in that particular fund. Mr. Deputy Speaker, with those too kind few words, I really do believe the Member for Fort Whyte (Mr. Loewen) is owed an apology. Mr. Deputy Speaker. Is the House ready for the question?

Some Honourable Members: Question. Mr. Deputy Speaker: The question before the House is second reading of Bill 28, The Labour Sponsored Investment Funds (Various Acts Amended) Act;

Loi sur les fonds de placement des travailleurs (modification de diverses dispositions legislatives). Is it the pleasure of the House to adopt the motion? Some Honourable Members: No. Voice Vote Mr. Deputy Speaker: All those in favour of adopting the motion, say yea. Some Honourable Members: Yea. Mr. Deputy Speaker: All those opposed, say nay. Some Honourable Members: Nay. Mr. Deputy Speaker: In my opinion, the Yeas have it. Mr. Marcel Laurendeau (Opposition House Leader): Mr. Speaker, on division. Mr. Deputy Speaker: On division.

SECOND READINGS Bill 47-The Budget Imp lementation and Tax Statutes Amendment Act, 2001 Hon. Greg Selinger (Minister of Finance): move, seconded by the Minister of Health (Mr. Chomiak), that Bill 47, The Budget Imple mentation and Tax Statutes Amendment Act, 200 I; Loi d'execution du budget de 200 I et modifiant diverses dispositions legislatives en matiere de fiscalite, be now read a second time and be referred to a committee of this House. Motion presented. Mr. Selinger: Mr.

Speaker, I am pleased to present for second reading Bill 47, The Budget Implementation and Tax Statutes Amendment Act, otherwise known as BITSA. Bill 47 intro duces a number of tax amendments that were announced in the 200 I Budget, which I had the pleasure of delivering to the Assembly on April 10. We have renamed this statute. Formerly known as The Statute Law Amendment Taxation Act or SLAT A, it has now been changed to BITSA to more clearly reflect its coverage.

The thrust of the tax measures contained in the 200 I Budget and in Bill 47 reflect the pre Budget public consultations with Manitobans, a number of which I and my colleagues from both sides of the House had the pleasure of attending. This Budget, therefore, based on those consul tations and our election commitments, reflects the priorities Manitobans asked us to address through a balanced approach. I would like to begin with

Part 4, which contains the most comprehensive and detailed provisions in Bill 47 pertaining to The Income Tax Act. The first section,

section 13 through

section 24, amends a number of provisions that serve to reduce taxes paid by individual Mani tobans. Bill 47 builds upon the $I0 2 million in

July 3, 2001 LEGISLATIVE AS SEMBLY OF MANITOBA 3395 personal tax reductions we introduced in our first budget and adds another $80.4 million in tax relief to individual Manitobans throughout the province. Because of reductions we introduced in the 2000 and 2001 budgets, Manitobans will see their average tax bill reduced by 10 .5 percent by 2003. This is not counting labour-sponsored tax breaks that people will get.

These reductions are significant and important in keeping Manitoba competitive with other provinces' income tax regimes without sacrificing our health, family services or edu cation systems. * (15:10) I would now like to outline some of the particular reductions contained in Bill 47. The top income tax rate is reduced from 17 .5 to 17 .4. In 2000, the rate was 17.63. The middle income tax rate is reduced from 15.6 to 15.4 in 2002; then to 14.9 in 2003.

The nonrefundable credits are increased by 2.5 percent over the 2000 amounts; the supplementary increases to disability, caregiver and infirm dependants' credit amounts. The property tax credit is now more appropriately called the education property tax credit. Most importantly, the amount is being increased by $75 in 2001, including the homeowner advance that qualifying Manitoba homeowners receive directly on their annual property and school tax bill. This is in addition to the $75 increase we announced in the 2000 Budget, raising the minimum credit from $250 to $400 in just two years.

The refundable learning tax credit is being reduced from 7 percent to 4 percent commencing in 2001. Despite the rate reductions, students will still earn a higher credit in 2001 because of the doubling of the education amount from $200 to $400, which automatically increases the amount of the learning tax credit. The 2001 Budget also introduced a number of reductions for businesses in Manitoba. The general corporate income tax rate, which had been fixed at 17 percent since 1986, is being reduced in four equal increments to 15 percent in the year 2005.

The active business income threshold for businesses eligible for the small business corporate income tax rate, which we have systemically reduced down to 5 percent by 2002, has increased from a threshold of $200,000 to $300,000, commencing in 2002. Corporate income that qualifies for the federal small business deduction will have that amount increased by 50 percent for purposes of calcu lating the Manitoba small business corporate income tax rate. The Manitoba Film and Video Protection Tax credit has been extended for three years.

In addition, the $50-million asset cap has been eliminated, which will assist smaller Manitoba based production companies who wish to engage in co-production with larger production com panies.

Part 1 amends The Corporation Capital Tax Act. The first amendment clarifies that interest is not paid on the refund of tax instalments. Corporations are already entitled to reduce their tax instalments based on an estimate of their actual tax payable. The second amendment clarifies that corporations that do not comply with the statutory requirement to make their records available for audit in Manitoba are required to pay an auditor's travel costs to conduct the audit outside Manitoba.

Part 2 amends The Health and Post Secondary Education Tax Levy Act. The annual payroll tax exemption at $1 mill ion must be prorated for employers who operate in Manitoba for less than a year commencing January 1, 2002. This will put Manitoba-based employers on a more equal footing with their part-year employers similar to other provinces that have a payroll tax. Also, as with the corporation capital tax, employers must pay an auditor's travel costs to conduct an audit outside Manitoba where the employer fails to make its records available within Manitoba.

Part 3 renames The Homeowners Tax and Insulation Assistance Act to The Property Tax and Insulation Assistance Act in order to more accurately reflect its scope.

3396 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 2001 The Environmentally Sensitive Areas Tax Credit which I announced in the 2001 Budget is introduced under the renamed statute. The program provides private landowners or occu piers with a property tax credit funded by the Province to offset costs associated with the restoration or protection of prescribed land. Further details under this program, such as eligibility criteria, will be subsequently intro duced by way of regulation.

Part 5 amends The Motive Fuel Tax Act, correcting the statutory language such as only the director, not a collector or other person, may issue a licence under the statute.

Part 6 amends The Retail Sales Tax Act. The 2001 Budget announced several measures that are being implemented through Bill 47. The sales tax exemption for manure slurry tanks and lagoon liners for livestock operations, which is designed to promote safe handling of animal waste, is extended until June 30, 2002. Concomitantly, I announced in this year's Budget that non-farmyard use of agro-chemicals will no longer be exempt from the sales tax effective May 1, 2001.

The exemption will con tinue to apply to non-chemical products used ordinarily in agriculture or horticulture regard less of whether purchased for farm, residential or other use. Combining these measures, along with the environmentally sensitive tax credit, ensure that our taxation policies are effectively targeted to promote more environmentally safe and friendly practices. Members may also notice that the extension of the sales tax exemption from only hard-copy books to include electronic forms of books announced in the 200 I Budget is not included in Bill 47.

I would like to inform the Assembly that the exemption has been in effect since May 1, 2001, and the necessary amendments will be reintroduced by way of regulation in the near future. Manitoba is now a member of the international registration plan. Effective com mencing March 1, 2001, Manitoba will now be able to better audit and tax more equitably intetjurisdictional commercial truckers who are now required to pay sales tax as the vehicle is consumed or used, rather than upon acquisition based on the entire purchase price.

Membership will aid the Province in ensuring that com mercial truckers who frequently commute to Manitoba contribute to the sales tax in the same way that provincially based truckers are required.

Part 6 also introduces a number of housekeeping and administrative amendments designed to better reflect past policies and practices in the department, as well as to tighten the Province's standing as a creditor under The Retail Sales Tax Act. The sales tax exemption for food and beverages purchased by commercial airline carriers for consumption by passengers is now legislated to conform to the department's practice.

The exemption of assets transferred from an individual partnership or corporation that does not wholly own and control the purchasing corporation requires that the trans feror receive shares in the transferee corporation. Parallel with the Ontario exemption, the transfer or must now retain the shares for at least six months. Simi larly, where the purchaser of an existing manufacturing plant includes used machinery and equipment, the exemption on the machinery and equipment will now require that the assets continue to be used for at least six months in accordance with the department's practice.

Manitoba, like other provinces, requires the issuance of a ministerial clearance certificate upon the bulk sale of a business to ensure that the vendor has paid all the applicable taxes up to the date the business was sold. Currently, certificates are only required to state that the seller of the business has remitted all tax collected. The amendment will require certi fication that all sales tax payable by the seller to the Province has been paid.

The department's collection powers are now expanded to match those provided for under the federal Income Tax Act and excise tax legislation covering third party demands against funds owing from a tax debtor to a secured creditor. This legislation is similar to that implemented in Nova Scotia.

Part 7 amends The Tobacco Tax Act in order to allow for the increase in the tobacco tax rates announced in the 2001 Budget. The taxes

July 3, 200 1 LEGISLATIVE ASSEMBLY OF MANITOBA 3397 from the increase on cigarettes has increased from 8.6 to 9.6 per cigarette, from 7.3 to 8.3 per gram on fine-cut tobacco and from 6 percent to 7 percent per gram on raw-leaf tobacco. Recent statistics show that tobacco consumption is on the rise again, and it is universally recognized that the consumption of tobacco has a harmful impact on users and those subjected to second hand smoke. Taxes are often used by govern ments to discourage tobacco use and to generate more funds to compensate for the increased costs of health care attributable to smoking.

Part 8 amends The Water Power Act to allow for the increase in the water power rental rates announced in the 2001 Budget.

Part 9 enumerates the coming-into-force provisions applicable to the various amendments in Bill 47. Bill 47 introduces several other house keeping amendments as well as new measures designed to ensure that Manitoba's income tax legislation is in step with federal changes and changes made to the provincial legislation in 2000. Provisions affecting the tax treatment of mutual fund trusts are amended to account for the 2000 tax reform that moved from a tax on personal income tax regime to a tax-on-income system. Shares acquired under the Equity Tax Credit Program are deemed to be held in a stock savings plan.

This is a federal requirement to ensure that such shares receive the same federal income tax treatment as shares acquired through a labour-sponsored venture capital corporation. Federal income tax legislation now has civil penalties for any misrepresentation on tax matters by tax planners and tax advisers.

Section 30 introduces parallel provisions under Mani toba's income tax legislation. Manitoba, like other provinces, is continuing to renegotiate with the federal government the renewal of the tax collection agreements pending the successful resolution of discussions, and in order to avoid potential confusion on the part of taxpayers,

section 31 provides that any inconsistency between Manitoba's income tax legislation and the tax collection agreement does not remove federal authority to collect and administer Manitoba's income taxes. I invite members and Manitobans to read Bill 47. I have covered most of the provisions, but there are consequential amendments con tained in the bill that flow from these measures that I have discussed today. Thank you, Mr. Speaker. Mr. John Loewen (Fort Whyte): I move, seconded by the Member for St. Norbert (Mr. Laurendeau), that debate be adjourned on Bill 47. Motion agreed to. * (1 5:20) House Business Hon.

Tim Sale (Acting Government House Leader): I would like to announce that Bill 28 is being referred to the meeting of the Standing Committee on Municipal Affairs for 6:30 this evening. Mr. Deputy Speaker: It has been announced by the Acting Government House Leader that Bill 28 is being referred to the meeting of the Standing Committee on Municipal Affairs for 6:30 p.m. this evening. Mr. Sale: I believe, Mr. Deputy Speaker, that it is in order to move that the House resolve itself into a Committee of Supply, seconded by the Minister of Health (Mr. Chomiak). Motion agreed to.

COMMITTEE OF SUPPLY Concurrence Motion Mr. Chairperson (Conrad Santos): The Committee of Supply has before it for our consideration a motion concurring in all Supply resolutions relating to the Estimates of Expen diture for the fiscal year ending March 31, 2002. The floor is now open to questions. Mr. Stuart Murray (Leader of the Official Opposition): To the Premier: I wonder if the Premier could confirm that the Government of Manitoba has appointed an agency of record with respect to advertising.

3398 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 2001 Hon. Gary Doer (Premier): I remember the question was raised about advertising in my Estimates, and I suggested that the members opposite deal with the IRD department in the department of cultural affairs, as I recall it. I am not sure whether this was raised or not. I will have to take the question as noti ce. I think advertising takes place in the standard tendering way. Mr. Murray: I just would be somewhat surprised that the Premier would not be aware if there is an agency of record.

I think it follows under sort of a format that he would either take some interest in or know. So I will ask him again. If he is going to give the same answer, I would consider moving on, but I just think an agency of record for the Government of Manitoba is something that the Premier would be aware of. Mr. Doer: Well, again, the question was raised about advertising under my Estimates, and I suggested the members opposite asked in cultural affairs. I will review Hansard. I know there are tenders for advertising.

I know some of the companies, for example, if I recall correctly, McKim wanted a bid on the issue of Tourism, which is a large contract, through a tendering process. I expect the process is similar to what has been in place before. The issue of agency of record, I am not a PR person myself, so I do not know some of the kind of terms necessarily that the member opposite may be aware of more intimately, but that does not mean to say I should not know it. So I will take it as notice. Mr. Murray: I wondered if the Premier is aware of a communications agency out of Vancouver called NOW Communications. Mr.

Doer: Yes, I am. Mr. Murray: Would the Premier know if NOW Communications is doing any advertising for the Government of Manitoba? When I say now, I mean currently doing some advertising for the Government of Manitoba. Mr. Doer: I wiii have to take it as notice. Again, I think this question was raised with me. We agreed in Estimates of the Premier that we would ask the questions in cultural affairs. I will go back to cultural affairs and find out whether they are working. I know that two of the public contracts have become an issue. One is the Lotteries contract.

I think that is with McKim, if I am not mistaken, but it is certainly not a decision we made in Government. I will double-check that just to try to get the range. I know that they have set up an office here, and I know that they have got some work; but it has all been under the tendering process, as I understand it. We wiii produce all the contracts. The amount of advertising generally, I believe, has been comparable to the past. There was a major health ad campaign dealing with childhood injuries. I will check and see who did that.

I know we wanted the advice we received from the Department of Health, if we could reduce some injuries it could make a significant difference to families. I will take a look at all the contracts and provide them to the member. Mr. Murray: I thought the health ad was an excellent ad, by the way. I thought it was very well done. Would the Premier provide the House and the people of Manitoba with a list of all Manitoba suppliers contracted, either hired or contracted by NOW Communications? Mr. Doer: I did not understand the question.

The question was: Will we supply a list of all contracts they received from the Government? Mr. Murray: A list of suppliers contracted or hired by NOW Communications, if they have contracted out for work. Mr. Doer: If they have contracted out work that has been done by the Government, in other words, it is public money-I will, again, take the question as notice. I will have to find out whether first of all if they have done any contracts and then secondly if they have any suppliers. I know they have set up an office here and I know they have bid on contracts.

July 3, 200 1 LEGISLATIVE ASSEMBLY OF MANITOBA 3399 Mr. Murray: I wonder if the Premier could tell the House what the process or the procedure is between NOW Communications and IRD and the information resources division of Culture, Heritage and Tourism. * (15 :30) Mr. Doer: I do not believe there has been any change in procedures from the previous government. There has been no change in procedures. I hear of the odd comment from time to time, not about NOW but other groups that allegedly do not get enough law pra ctice or advertising work, whatever.

We have not generally paid much attention to that and allow it to go through the proper tendering process. Hopefully, merit will determine the awarding of contracts, merit being cost-effectiveness. Usu ally, the departments are more involved with IRD than we are. For example, in the tourism contracts, obviously it is a big contract, I believe there was some diligence paid to it in terms of what shifts we could have in tourism strategies, particularly over the long term for American tourists. I do not believe there has been any change in procedures, but I will check that.

We have been lobbied by local Manitoba firms for purposes of Crown corporations about how much was this content or that content, but I remember being in Opposition and getting lobbied by some of the same excellent individuals on directors who were hired outside of the province or ad companies that were hired outside of the province and that's impact on the local industry.

Again, I will take the question as notice, but do not think there has been any top-down decision making for me on changing the procedures in, for example, awarding the con tract in tourism when the contract was awarded to Bi ggar and Associates a few years ago. I believe it was the same process that was used to hire McKim, if I am not mistaken. That is a big one. That is an obvious big one in government. The other one I can think of is the health one. Mr. Murray: So, just for clarification, Mr.

Deputy Speaker, if there is any tendering of any contracts in terms of advertising, those decisions would be made by IRD? Mr. Doer: Well, they are mainly in consultation with the departments. For example, in Tourism, you would have, I believe Mr. Mesman was put in place prior to that. I cannot remember the sequence of events because there was somebody else in that job for a period of time. Mr. Mesman has worked, for a long time, in Tourism. He was involved, I believe, in the Tourism contract. The IRD is involved, but I can get the selection committee.

Oftentimes, with major decisions, there is a multi-department, multi-stakeholder group of people, as there was in the past, and I do not believe there has been any change in that. Mr. Murray: So, just again for clarification, the Premier states that IRD working in consultation with the departments would make the decision. In other words, whatever the agency that would have done the health advertising would have appeared before IRD, and they would have worked with the Health Department to decide which agency to work with. Mr.

Doer: I am most familiar with tourism, but there was work with the Tourism contract and the awarding of the contract. There were bids from a number of companies, and there was a pretty technical exercise. I think that the member opposite knows the ad companies, and knows their history, and knows that this would be awarded on what was perceived to be a bit of a shift in some of the directions we wanted to take. There is still a lot of work to do. We have got a lot more work to do on tourism.

For example, we wanted to start putting some small Tourism spots in the Minneapolis market, and over time we wanted to do more in the midwestern United States and make sure that we try to capture some of that, but the issue of who gets the contracts, there is a committee. I can report back. I know there is a multi-stakeholder committee from time to time on some of the technical committees that would be involved. We have created a number of multi-stakeholder committees. I mean, the Red River community college, we had about four or five departments working on it, maybe six departments.

The new entertainment centre, the True North project, we had a number of people across departments. For example, we wanted to know ahead of time what is the historic

3400 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 2001 significance of the Eaton's building. Well, obviously, you are asking questions before you make decisions, because they get asked after you make the decision. So there is a group of people. A lot of times we will use a different set of representatives to try to make sure we can get the best decision. Mr. Murray: Is there any direct relationship between the Premier's office and IRD? Mr. Doer: IRD and the Premier's communi cations office worked in the past together and work currently together. There is no change in that relationship.

Communicators, hopefully, communicate. I was at an announcement just recently with Mr. Fawcett from that office. There were two people I think when we had the all-party group meeting with South Dakota, North Dakota and Minnesota. There was an individual from the IRD. They were working with individuals from our office because of the media requests in the Midwest. That is I think as it was before. I remember dealing with public events with the former Premier. There was sometimes, say, Mr. Fawcett.

Then sometimes there were people from Information Services, sometimes they were IRD, and sometimes it is from the Premier's office. Hopefully, they are communicating. Hopefully, they are working together. Mr. Murray: Mr. Chairperson, I would have to go back and check some of the comments that were made when we were going through Estimates. If memory serves, and I do stand to be corrected, I was under the impression that you said that there was no relationship between the Premier's office and IRD. Now you are saying that there is some relationship. Mr.

Doer: I will go back and check, but there is a difference between communications and decision making. I am assuming that they are communicating to each other. I know that they are. I will check Hansard as well. I mean, there is a difference between lines of authority in decision making and communications. Mr. Murray: I agree. I think there is a noticeable difference.

That is just sort of why I am asking the question, just to ensure that if the process, as the First Min ister states, is really one that involves IRD with working with the departments that there is no direction given from the First Minis ter's office. I think that is something that we were trying to find out what that relationship was when we were talking through Estimates.

I think that is really what we are trying to find out now, if there is any change or if there is any direct reporting that the Premier's office can either have decision making with IRD or any kind of influence on IRD's decisions, because I think that that is something that the First Min ister makes a comment on, that there has been no change to the way it is currently now to the way it was under the former government.

I just want to ensure that I get it very clearly from him that the process that existed under the former government, with the relationship between the Premier's office and IRD, is the same current relationship between this Premier's office and the IRD. Mr.

Doer: Well, I think it is safe to say even under the former government there was a difference, in my view, from people I talked to, and the member opposite will have his own sources, between the former director of com munications for the Premier's office and one Barbara Biggar and the relationship and style of Bonnie Staples, so is that a product of function or communication style or whatever? I think it is safe to say. I had sources, when I was in Opposition. The member opposite has got sources now. I think the style of communication, the functional area of working together, should be similar.

I know, from the past, there was even a change in style with the change in government, just a change in some of the personalities. *( 15: 40) The bottom line is the public interest should be served, whether it is a tendering of contracts or in production of materials for the public, or whether it is in just making sure that we have some kind of relationship with the requirements of the media. For example, the flood report, we had a technical report ready.

We had to get clearance from the federal government who was co-sharing that, so there was work between our office and the federal government for releasing a report that we thought was important. What was in the report and how it was released, it was done by the Department of

July 3, 2001 LEGISLATIVE ASS EMBLY OF MANITOBA 340 1 Conservation with IRD people. So sometimes there is even work beyond our office, to Minister Duhamel's office or the Western Diversification office or some other office always. So there is lots of communication going on about com munications. We do not always have the uni lateral right when we are dealing with the private sector agreement. We read about it. We were answering questions in the House one day and half of it was in the Free Press the next day. That is just-[interjection] What is that? Some Honourable Members: Oh, oh. Mr.

Chairperson: Order, please. Mr. Doer: Well, I tried to say it would be released on such and such a day, but the media has a way of getting their own story so. Mr. Murray: As you look at advertising in other areas, tourism and that sort of thing, particularly in the States, can you just maybe inform the House as to the process, how that would work in terms of agencies here in Manitoba versus agencies abroad, what that process would be? Mr.

Doer: I am not sure how an agency of record, if there is an agency of record in tourism, for example, the first thing I want to check out is I mentioned the tourism account which I am familiar with. Is there only one agency of record, or are there more than one agency of record? Secondly, how does that agency work with another agency? For example, just for the purposes of a buy, is there the ability to do it right here with a company that has worked already in the United States, or do you have to go through another agency? I am not sure of that. I will come back to the member opposite.

We have never advertised in the United States politically, but I would not have any involvement in that either in the last campaign or any other campaign. I am not intimately aware of how all these things work except in terms of who the agency of record is, et cetera, and whether there is one agency record or more than one and how they work with an American agency if they have to for a buy, or can they go directly to the providers of those services?

For example, we had three billboards down in Minneapolis last year: one dealing with Clear Lake, I think one dealing with The Forks, a third one I am not sure what it was, three sites in Manitoba to feature. We certainly did not want it to be all Winnipeg. That was just a preliminary attempt to try to get some notice into that market. We are going to try to do some other things too because a lot of Americans, their dollar has such an advantage here right now.

If we do not have an event like the Pan Am Games, what else can we do to get more people here in the summer and all year round, all four seasons kind of situation? Mr. Murray: I would like to ask the Premier some questions on True North. I would certainly like to go on record saying that unlike some of the things that may have been said from the other side that we are very supportive of a downtown entertainment complex, as it is known as True North today, on the basis that what we have been told is that it is a 70-30 split, 70% private sector. 30 percent of the monies being put in by the public sector.

That is something that we support very much. I think private sector-driven initiatives are to be encouraged, of course with all the right regulations behind them. This group that is putting this together are known to the First Minister, as they are known to myself. They are first-class Manitobans. They want to do the right thing for Manitoba. There is no doubt in my mind about that. So I think it is important that the record indicate that we are very, very supportive of a 70-30 split downtown entertainment complex. The question that I would like to ask the Premier really is: Just what is the ceiling?

What is the most that the taxpayers of Manitoba will be involved in this project? Maybe the Premier, maybe I could start there by just saying: what is the maximum risk for the taxpayers of Manitoba for the True North project? Mr. Doer: I tabled the term sheet to the media in the press release when it was first released. It dealt with the capital asset. There are two parts of this agreement, as the member opposite will know. One is the capital investment and the other is the operating. On the capital side it is pretty straightforward, although even there you

3402 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 200 1 could argue that it is less than even the money that is there. For example, we have got $10 million that we would have spent in another place in the infrastructure program, because we agreed to the infrastructure program and a $3- million urban grant on the capital side. The Department of Industry and Trade has provided and the statistics branch has provided us with revenue projections for sales tax, salaries, related investment that will be available to Manitoba up to $1 1 million out of the $13 million.

Because we are both a provider of investment and a taxer, if you will, in the sales tax and the income tax side, albeit with lower taxes than when we came into office, you could argue these numbers, worst case, best case. I think it is saf e to say that the capital side is pretty straightforward. The operating side is a different matter. It is going to require I think by the year 2004, we will know for example the actual investment in how many events there are per year, how much revenue that generates, what is the projected VL T revenue.

We looked at both the art gallery as one model, where the Province funds $2 million a year on an annual grant for the operating expenses. We looked at Assiniboia Downs. We actually looked at the Assiniboia Downs as the business model with some amendments, the Assiniboia Downs model. It was not going to be reallocated, or they were going to be reallocated as opposed to expanded VL Ts. We thought that downtown Winni peg, the 50 VL Ts being reallocated, the model for the Assiniboia Downs is a good one to get a new downtown arena. We will not know till sometime in 2004 whether it is above or below the $1. 5 million.

The projections were based on numbers from Lotteries Manitoba and based on average use, not coin-in scenarios that are in your resolution but rather on coin-out revenues. Even there, if you look at the model of the most underutilized VL Ts, the cost to the Province is lower than the value to the investors. *( 1 5: 50) There are two other issues of operating that are important, and these are all in the term sheet. I am giving you a verbal description of them, but the detail is all in the term sheet, which has been tabled in my Estimates.

The other provision is to have comparability with the former building on the basis of tax consideration, which I thought was missing from some of the first articles. Actually, the first verbal briefing I gave, I tried to make that very clear to the public through the media. Three, the community access: we also, for our investment, are going to get community access. The United Way is working with the project, so there is not only a cost to us of the VL T machines on the operating side, there is also a community value that we are still working on. We think, all in all, it is a good package; it is a worthy package.

When one considers we have 4000 VL Ts in Manitoba, in Winnipeg in fact, and we are reallocating 50 of them, the value to the investors is going to be lower than just one major hotel chain in this city, whom the member would probably be able to suggest. So these decisions are made by govern ments, and we think it is, all around, a very defendable package. Most of the feedback we have been getting is pretty positive about going ahead, and I am sure the member opposite has as well. A perfect deal for us is I 00% private sector investment and 100% private sector risk and I 00% private sector operating risk.

The second best deal for us is limiting the capital risk and the operating risk and knowing ahead of time what the exposure will be, and it is the 50 VL Ts with the formula that has been articulated in the term sheet. Mr. Murray: We have had debates in this House over what was said, what the First Min ister is reported to have said or what we know he said on CBC TV. At that time, the comment was that there would be a cap on the VL T revenues, and that amount was deemed by the Premier at that time to be $1. 5 million.

Certainly I want the Fi rst Minis ter to know that when asked by the media, what did our side think of the Government's involvement in this project, I responded by saying that there is a role for the Government to play in this facility. That

July 3, 2001 LEGISLATIVE ASSEMBLY OF MANITOBA 3403 my responsibility, I felt, as Leader of the P.C. Party of Manitoba and Leader of the Official Opposition, was to ensure that we did the due diligence of the deal with the government of the day on the basis of ensuring that the taxpayers of Manitoba knew what the Government was committing the taxpayer of Manitoba to.

So, on the capital side, certainly I think the First Minister makes a very interesting play on saying that of the $10 million and the $3 million urban grant, that that could be paid as a tax collector, that those things would be paid back over a short period of time, and I think he is absolutely right. I think that that debate that tried to take place around '95 fell on deaf ears because I do think there is a way to get the monies back as a tax collector if you can create and generate some activity so the $10 mill ion and the $3 million urban grant is certainly something that I understand.

The First Minister makes reference to the term sheet. I know we have had these discus sions, but I would ask the First Minister: on the basis that if I were answering to a taxpayer in my constituency, what best can you tell me in terms of our risk as a taxpayer? We understand there are 50 VL Ts going in. I do not think anybody is quarrelling with the number of VL Ts. They understand there are 50 going in. But it is a matter of saying: is this a sliding scale? Is something changed?

Because I can tell you I have been on record as supporting what the Premier alleged to the House, which I believe was the $10 million on the capital investment, the $3 million on the urban grant, and a cap of 1.5 for 25 years, as I understand it, was on the VL T. So when you deal with the 50 VL Ts, what is the maximum exposure for the taxpayer of Manitoba, understanding that we have dealt with the capital side, but looking on the operations side? Mr. Doer: The best way to describe it is, it is in the term sheet. There are 50 VL Ts.

Even when I was being interviewed, verbal interviews with a lot of media, I said that all the details, all the details and the more precise details, would be in the term sheet that would be released publicly. Even in the interview that was mentioned I said that all the details will be released, because we were getting questions on Assiniboia Downs, we were getting questions on different ownership and flipping and all these kinds of other things. The terms sheet describes in full detail the terms and conditions of the operating require ments from the Government.

It also describes in full detail where we do not have operating requirements, for example. I do not think this will happen, but say you only had 50 hockey games and 10 other events instead of more than a hundred events a year. The taxpayers of Manitoba would be subject to, you know, there is the investment of the reallocated VL Ts, but there is not a requirement that we would pony up, if I can use that term, some additional revenue to deal with an operating shortfall. That risk, beyond the conditions that are in the term sheets, that risk is clearly articulated in the term sheet with the private sector.

Then the question gets asked: well, how come you have no equity in it? Well, we did not want equity in it because we did not want risk in it in terms of the taxpayers. We did not want the criticism being: Well, if they lose $10 million a year, you have got 25% equity and therefore you are subject to $2.5 million a year or you are subject to, if it loses $20 million a year, you are sub ject to $5 million or some other proportion of that. So we thought that one of our conditions, and then I got criticized for not having equity in the agreement.

We thought that no matter who is in government, over time, and that, we know, I know will change, that somebody will not have it will change in 12 years or 16 years, I do not know. But I never- An Honourable Member: Try two. Mr. Doer: Well, anything is possible. I am convinced that whoever is in government would not be writing a cheque that is beyond the term sheets that have been tabled in the House. I think it will take at least a year to be more definitive on, as it was probably with members opposite. They had to make a decision, for example, there are management decisions every day.

You make a decision to go to a 20% return to hotel owners as opposed to Saskatchewan going to 15 or Alberta going to 15. You have made a decision on $7 million or $8 million a year that could go

3404 LEGISLATIVE ASSEMBLY OF MANITOBA July 3, 200 1 to the public purse or up to $10 million a year versus the vendor, the private sector owners going from 15 to 20 percent, a liabili ty or a cost or whatever else, you know, it was a decision that was made. So these VL Ts, the other part of them is: What will the revenue be? We have models, not based on the Assiniboia Downs modelling because it has Sunday openings, which is one of their most lucrative days, but when you talk about revenues, I think the question was raised by Mr. Reimer in the House, or the member for Niakwa in the House.

He had a number of revenues that were higher than the 15 0 VL Ts without a formula change at Assiniboia Downs with Sunday openings. It is almost implausible for that to happen. [interjection] Yes, they do. * (16: 00) An Honourable Member. You learn something new every day. Mr. Doer: Well, you know, you do learn something every day. When you poke around at some of these things, you learn a lot. I am not saying right now that I have learned everything about VL Ts. To be perfectly honest, I have never put a quarter in one.

But I also said in the '99 election, and I think even the '95 election, that we would not be able to reverse what happened, and we obviously have not. I think we will know in probably November of 2004 whether it is below $1. 5 million, at $1. 5 million, which were the projections we were given. There may not be the volume through that VL T centre in a new entertainment centre, and at that point it may be well below $1. 5 million because I have heard the statement caps and minimums and everything else. We will know in October, November of 2004 whether the projections were accurate, whether it exceeded projections.

I actually think there is a greater chance of not exceeding $1. 5 million, of actually being below that because of the volume, but I am not sure, and neither are the risk takers that are, I think, doing it for the best interests of the community. Mr. Murray: Mr. Chairperson, so there is a possibility, if something happens on the VLT revenue, that it could be less than $1. 5 million per year. Mr. Doer: The terms are in the term sheet. I think it is going-[interjection] You have already accused me of bankrolling $50 million of Crocus money, the member for St. Norbert, and demanding that Mr.

Kostyra go to City Council to present this, as I recall the last conversation we had. It is in the term sheet, and there were about 28 conditions in the term sheet, some of which are still going to take a little time to determine the exact amounts, because it will be based on experience, but the numbers we got were from the Lotteries Corporation based on the expectation of not coin-in, but coin-out return. Mr. Murray: If the machines, the VL Ts, do not generate $1. 5 million, will the machines be pulled from the True North project? Mr.

Doer: You can see, in the term sheet, that that does not apply. [interjection] Well, they will not make as much money as some hotels, the hotel chains. We will have a good chat in the fall of 2004, and there is lots of Hansard here to have the chat over. I just think that, for reallocating 50 VL Ts, as I said, we looked at the model of the Art Gallery, the $2 million a year which is sometimes interesting. I believe that this will be a very sustainable agreement for the public sector. I hope it is sustainable for the private sector. I do want them to make a fair rate of return.

They are taking all the risk in terms of beyond the

Document details

Collection	Manitoba — Debates (Hansard)
Citation	37-2-56
Type	hansard
Volume / chapter	37th 2nd hansardpdf 56.pdf
Language	en
Format	pdf
Source	PROVINCIAL
Identifier	5944f7d296ff130d5bbae57d02bf36cd170237c8

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