LEGISLATIVE ASSEMBLY OF MANITOBA Tuesday, 6 April, 19 82 Time - 2:00 p.m. OPENING PRAYER by Mr. Speaker. MR. SPEAKER, Hon. D. James Walding (St. Vital): Presenting Petitions . . Reading and Receiving Petitions . PRESENTING REPORTS BY STANDING AND SPECIAL COMMIT TEES MR. SPEAKER: The Honour able Memb er for Minn edosa. MR. DAVID R. (Da ve) BLAKE (M innedosa): Mr . Speaker, I beg to present the Fir st Report on the St anding Comm ittee on Public Accounts. MR.

CLERK, Jack Reeves: The St anding Comm ittee on Public Accounts begs leave to present the follo w­ ing Com mittee report: Your Com mittee met on Tuesday, April 6, 19 82 and appointed Mr . Blake as Chairman. Your Comm ittee agr eed that a quorum for all future meeti ngs of the Comm ittee should consist of six (6) mem bers. Your Comm ittee has exami ned the Provincial Audi­ tor's Report and the Public Accounts of the province for the fiscal year ended Ma rch 31, 19 81 and finds that the receipts and expenditur es of the mon ies have been care fully set forth and all mon ies properly accounted for.

Your Comm ittee received, or has been assured that it will receive, all information desired by any mem ber from the Min ister, Heads of Departments and mem bers of the Provincial Auditor's staff with respect to receipts, expenditur es and other matters pertai ning to the bus­ iness of the province. The ful lest opportunity was accorded to all mem bers of the Comm ittee to exam­ ine vouchers or any documents calle d for and no restriction was placed upon the line of exam ination. MR. SPEAKER: The Hono urable Memb er for Min nedosa. MR. BLAKE: Mr .

Speaker, I move, seconded by the Honour able Memb er for Swan River, that the report of the Comm ittee be received. MOTION presented and carried. MR. SPEAKER: The Ho nourable Memb er for Flin Flon. MR. JERRY T. ST ORIE (Fiin Flon): Mr . Speaker, the Comm ittee of Supply has consider ed certain resolu­ tions, directs me to report the same and asks leave to sit again. I move, seconded by the Honour able Mem ber for Ell ice, that the report of the Comm ittee be received. MOTION presented and carried. MINISTERIAL STATEMENTS AND TABLING OF RE PORTS MR. SPEAKER: The Ho nourable Attorney-General . HON.

ROL AND PENNER (Fort Rouge): Mr . Speaker, I beg leave to table the report pursuant to

Section 29. 1 of The Fatality Inquir ies Act concern ing persons who died in 19 81 while in a correctional institute, jails and prisons. MR. SPEAKER: Notices of Motion ... Introduction of Bills ... ORAL QU ESTIONS MR. SPEAKER: The Honour able Me mb er for Pembina. MR. DON ALD ORC HARD (Pembina): Thank you, Mr . Speaker. My question is for the Mini ster of Finance. Can the Mi ni ster indi cate if regulations are req uir ed to proceed with paymen ts to fa rm ers, homeowners, and busi nessmen who have qualified for inter est rate rei ief? MR. SPEAKER: The Honour able Mini ster of Fi nance. HON.

VIC SCHROEDER (R ossmere): Yes, Mr. Speaker. 11 67 MR. ORCHARD: Mr. Speaker, a supplementary. When will those regulations be gazetted? MR. SCHROEDER: The y're currently being drafted, Mr. Speaker. MR. ORCHA RD: In the absence of those regulations, does one ass ume that no one can be paid interest rate relief even though they have qualif ied under the pro­ gram as laid out by the government? MR. SCHROEDER: Tha t's correct. MR. ORCH ARD: Mr . Speaker, a final supplementary.

When would the Mini ster belie ve that the regula tions will be drafted, passed and gazetted, so that those people who have now qualif ied, or will have qual ified for interest rate relief, might expect payment of that relief? MR. SCHROEDER: Yes, Mr. Speaker. We do hope to have the regulations com pleted and passed by the end of the month. MR. SPEAKER: The Honour able Memb er for Arthur. MR. JAMES E. DOWNEY (Arthur): Mr .

Speaker, in view of the answers by the Hon ourable Mi nister of Finance, could the Mini ster of Agricultur e indica te to the House how many farmers have gone bankrup t in the past three months because of the high interest rates and high operating costs?

Tue sday, 6 April, 1982 MR. SPE AKER : The Honourable Minister of Agriculture. HON. BILL URUSKI (Int erlake): Mr. Speaker, there are farmers who have been in difficulty for a number of years. I don't have the specific answers that the member is speaking about, but certainly the farm community has had difficulties over a number of years. In the hog industry, which took two years to develop, in other areas, in the beef areas, Mr. Speaker, those farmers who are in difficulty are making appli­ cation. In fact there are approximately 200 who have applied and have been recommended for assistance. MR.

DOWNEY: In view of the fact, Mr. Speaker, that it was an election promise and that it was an emergency program, could the Minister not indicate to this House how many people have in fact gone out of business because they were unable to cope wit ti the current economic conditions? MR. URUSKI: Mr. Speaker, there will be, I'm sure, people who will go out of business as a result of a whole host of factors. Those people that are in busi­ ness and are facing the hardships of interest rates are app,lying and are being dealt with under the program. MR. DOWNEY: In other words, Mr.

Speaker, the elec­ tion promise of the Premier of this province is not going to be kept and there are people who are going out of business. MR. SPEAKER: The Honourable Member for Stur­ geon Creek. MR. J. FRANK JOHNSTON (Sturgeon Creek): My question is to the Minister of Economic Development and Tourism and I would like to ask the Minister if she qr anybody in herdepartment.had,contact with Walch Ltd., the clothing company that's been in operation for 60 years in this province before they went into receivership? MR. SPEAKER: The Honourable Minister for Eco­ nomic Development. HON. MURIEL SMITH (Osborne): Mr.

Speaker, I would like .. to take that question as notice. MR. JOHNSTON: Mr. Speaker, my question again, is the Minister - she would maybe want to take this question as notice. Sun Valley Pools, owned by Edwin Zacharias and three other businesses that he owned; Creative Fibre Glass Ltd .; The Water Closet and Keys­ tone Distributors Ltd. also went into receivership, I wonder if the Minister's staff has had any opportunity to have any conversationor<realings with them before or since the unfortunate happenings to these companies. MRS. SMITH: Mr. Speaker, I will take that question on notice too.

The staff normally are aware of receiv­ erships as they come along and there is an orderly process that is honoured. They don't usually inter­ vene in any more active way unless there is a program that we have in place to assist them but I certainly will 1168 get further information for the honourable member opposite. MR. JOHNSTON: A supplementary, Mr. Speaker, I would ask the Minister why they hadn't done some investigating in the clothing retail business when Brownstone's had gone into receivership or broke in January?

The indication then was that the industry was in trouble and thi:tre are other people in trouble. I would ask the Minister also, Mr. Speaker, that the Premier's statement, we can provide interest rate relief and economic climate to ensure that all small businesses stay in business - I wonder, Mr. Speaker, if the Minister could answer if that promise is going to be kept in the future? MRS. SMITH: Mr. Speaker, the member opposite must know that the oepartment has not had in place active programs for dealing with retail business.

I also, however will undertake to get further informa­ tion about this particular business. I'd like to add though, that I don't recall the leader or anyone else on this side saying that we could save all businesses immediately. We said -( Interjection)- We said, Mr. Speaker, and I'm sure that everyone on this side of the house will agree with me, that we could not promise quick and easy solutions.

We could put in place - (Interjection)- we could - if you will be so polite, Sir - we will put in place emergency programs to deal with the most difficult cases and we will then attempt to do the longer-range planning which will build a more secure economy. We do not, Mr. Speaker, as the members opposite well know, control the interest rate policy of this country which is the prime reason, Mr. Speaker, for the difficulty that Manitoba businesses are now finding themselves in. MR. SPEAKER: The Honourable Leader of the Opposition. MR. STERLING LYON (Charleswood): Mr.

Speaker, I have a question for the Minister of Agriculture. Has the Minister of Agriculture received from the Mani­ toba Cattle Producers Association a letter and att­ achments of March 24, 1982, wherein the report of that Producers Association with respect to their ideas in beef cattle marketing are put forward for the edifi­ cation of all members of the House? MR. URUSKI: Yes, Mr. Speaker. MR. LYON: In view of the fact, Mr.

Speaker, that the Manitoba Cattle Producers Association represents approximately 1 5, 000 producers in Manitoba, can the Minister confirm to the House that the beef stabiliza­ tion plan which he announced the other day was worked out in close concert with the Manitoba Cattle Producers Association and in accordance with the recommendations that they made as part of their study of beef marketing? MR. URUSKI: Mr. Speaker, the program that was de­ veloped was made in consultation with them and with other farm groups in the industry across the Province of Manitoba. Mr.

Speaker, there were several consul­ tations made, but the program wasn't developed to be

Tuesday , 6 April, 1982 specific along the lines tha t the assoc iatio n recommended. MR. LYON: Mr. Speaker, could the Honourable Min­ ister advis e the House and the people of Man itoba what other farm groups or individuals he consu lted, whose advice he would take over that of the Man itoba Cattle Producers Assoc iation which represents about 98 percent of the producers in Man itoba? MR. URUSKI: Mr.

Speaker, it seems that the Leader of the Opp osition whose grou p imposed the piece of legis lation on the farmers of Man itoba, a compulsory group and a compu lsory check out now wants to tell the farmers of Man itoba that they are the ones that are representing them. That's jus t not the case, Mr. Speaker. There are many producer groups in the beef indus try who I have consu lted with and have spoken to. -(I nterjection)- Mr. Speaker, if members would care to read Hansard there was a long discussion and deba te in this Chamber about who we consu lted with.

If the honour able mem bers don't want to read that's their prerogative, Mr. Speaker. MR. LYON: Mr. Speaker, cou ld the Minister of Agri­ cultur e then advise the Hous e and the cattle produc­ ers of Man itoba why it is that the principles which appear to un derlie his stab ilization plan are at 18 0 deg ree variance, or would appear to be at 18 0 degree variance, from the recommendations made by the report of the Alternative Marketing Committee of the Man itoba Cattle Produ cers Assoc iation, if in fact, as he says, he had meaningfu l consu ltations with that group? MR. URUSKI: Mr.

Speaker, if the Honourable Lea der of the Opp osition ag rees with that report then I pre­ sume he doesn't ag ree with the cash advances that we are proposing to the cattle industry? -(l nterjection)­ Maybe the honour able members on the opposite side don' t like the answers after they raised the questions. Mr. Speaker, the principles of income stabil ization and insur ance we have used in the plan that we have proposed, while it varies in terms of the specifics as to which part of the indus tries shall be covered, never­ theless, the' principles were accepted by us and by MCPA in their proposals to us.

What is at va riance, Mr. Speaker, is the way that the premium structure that was proposed by his group, that was set up by his group, which indicates in their proposals that, for exa mple, the cow-calf industry cou ld insur e themselves at a premium of somewhere around 16 percent of the sale price of the cattle. We cou ld not accept that and the members opposite who have said that 2 percent is too high, a premium that farmers should pay, his own assoc iation said that those same farmers should pay at least 16 percent of the sale price of their cattle. MR. LYON: Mr.

Speaker, cou ld I ask the Minister of Agricultur e this question? A simple yes or no will suffice. Mr.

Speaker, in the report of the Alternative Marketing Committee of the Man itoba Cattle Prod uc­ ers Association which the Minister says he has received, would he advise the Hous e and the cattle producers and the citizens of Man itoba, if he is aware 1169 of this paragraph in that report, and I'm quoting from page 7 of their report, "Another concern expressed by the committee is that the Provi ncial Govern ment not implement a marketing or stabil ization plan which would restrict producers' freedoms in the market­ place.

Up on study of the Saska tchewan Beef Stabi li­ zation Board's central selling concept, the loss of this freedom is evident." Mr. Speaker, that's a quote. Would the Minister tell us whether or not his plan is in accordance with that direct warning by the Beef Cat­ tle Produ cers Association of Man itoba? MR. URUSKI: Mr. Speaker, very obviously the pro­ posal I' ve made is not in accordan ce with that subm is­ sion. -(I nterjection)- Ab solutely, Mr.

Speaker, and one way that we have used the program to be able to ensu re that the payments that we do make are paid out on the basis of the slaug hter cattle that are mar­ keted and the only way to do that is through a central selling agency and we have proposed that, Mr. Speaker. That is the reason that is being proposed so that several ways of payments are not being paid out and that producers can and will be able to bring about some further competition in the marketplace for the cattle that they sell together, not unlike, Mr.

Speaker, what was proposed and was done by - I presume he was in government in the early '60s when they set up the Hog Marketing Comm ission. MR. LYON: Then, Mr. Speaker, could the Honour able Minister of Agricultur e confirm to the House that on the basis of the sketchy outline that we've had thus far of his stab ilization and marketing plan that he is in fact bringing in a plan that is contrary to the recommenda­ tions of about 90 percent of the beef producers in Man itoba? MR. URUSKI: Mr.

Speaker, I have consu lted with many more people than the Association of the MCP A and I believe that we will have an opportun ity to see how many people sup port that organ ization on a volu ntary bas is and obviously we will see how many people suppor t that I believe that there are many more farmers in the cattle indus try in this province that should have been consulted and were consu lted by our group and this program was developed as a result of those consu ltations. MR. SPE AKER: The Hon our able Memb er for Lakes ide. MR. HARRY ENNS (Lakeside): Mr.

Speaker, I wonder if the Minister of Ag riculture can indicate whether or not he and his government intends to, as they develop this plan, either purchase or lease feedlot facilities in the Province of Manitoba. MR. SPE AKER: The Honour able Min ister of Agricultur e. MR. URUSKI: Mr. Speaker, there will be a producers group established to discuss ramifications of areas which have been historically cow-calf producing areas and if there is a need in terms of discussion with those producers that there may need to be facilities established on a co-operative basis in those ar eas

Tue sday, 6 April, 1982 certainly we would want to encou rage that to happen. MR. ENNS: Mr. Speaker, I take it then it would be correct to assume that as the plan is envisaged by the Minister it is possib le that the government will be purchasing directly large feedlots in the Provi nce of Manitoba. I must remind the Honour able Minister that feedlot capacity is avai lable right now. The cattle feeders have had a tough time and you can probably get a bar�ain. MR. URUSKI: Mr. Speaker, no, it's not our intention to go out and purchase feed lots.

It is our intention to encour age the cow-calf industry to move their indus­ try into not only providing the calf crop for the Prov­ ince of Man itoba, but also moving along and finishing that calf crop. If there is a desire on behalf of produc­ ers in their area on a co-operative bas is to develop finis hing facilities, certainly we would want to look at that and encou rage that to happen. MR. ENNS: One final question, Mr. Speaker, how does the Minister intend to set it up?

Will it be run as a Crown Corporation with civil servants that normally work from 8:30 a.m. to 4:30 p.m. to look after a couple of thousand head of cattle that have to be fed every day, Sunda y, Sa turdays, including Christmas? If so, can he indicate an office to which applications for jobs can be sent? MR. URUSKI: Mr. Speaker, it appears that the hon­ ourable member wishes to catch the good lens of the camera. He can certainly have, and his colleagues have, an ample opportun ity to discuss all their aspects of this prog ram un der my Estimates which are before the Hous e now. MR.

SPEAKER: The Honour able Member for Turtle Mq_u ntain. MR. A. BRIAN RANSOM (Turtle Mount ain): Mr. Speaker, my question is to the Acting Minister of Energy and Mines. I wonder if the Acting Minister cou ld confirm whether or not work is proceeding on the clearing of a Hydr o right-of-way from Koostatak to Jack head and at the same time perhaps the Acting Minister could ans wer the question of how the con­ traqt for that clearing was awarded and when the.work is expected to be completed? MR. SPEAKER: The Honour able Minister of Finance. MR. SCHROEDER: Than k you, Mr. Speaker. Those are two good questions.

I'll take them as notice. MR. RANSOM: Mr. Speaker, my question is for the Minister of Finance. Over the recent weeks, there have been a numb er of different figur es put forward by the Minister of Finance as to the net impact upon Man itoba's revenu es of the new financing arrange ­ ments with the Federal Government. I believe the Min­ ister had provided me with a letter a cou ple of weeks ago for which I express my thanks clearing up a statement that he had made previously about a $38 million cutb ack and saying that it would be $21 mil­ lion.

I now see in the presentation which tlie Minister made to the Committee of Parliament in Ottawa that it would appear that the loss to the province might be $21 million instead of $31 million. Cou ld he advise whether that's because it's an average or whether that's a figure that applies to 19 82-83? MR. SCHROEl;)ER: Thank you, Mr. Speaker. Yes, I had referreq lilf pne stage to 38 million because I hadn't taken into account another $7 million offset which brought it down to 31 mil lion. The 31 million was the loss for the year 19 82-83 on Established Pro­ gram Financing and Equal ization put together.

Equal­ ization gives us a loss from where we would have been under the old prog ram of 21 million and EPF loses us an additional ten. The material that the honour able member refers to is material in which I discuss only the Equaliz ation portion, the reason for that being that when I went to Ottawa I wasn't discus sing EPF, because Man itoba is being treated in a fashion similar to all other provinces with respect to that. It was only the equalization portion I was referring to. MR. RANSOM: I thank the Minister for that answer, Mr. Speaker.

Some days ago, perhaps two weeks ago, I asked the Honou rable Minister of Finance if he could provide an estimate of what percentage of post­ secondary education. costs would be covered by the Federal Govern ment under the new cost sharing arrangem ents. I wonder if the Minister could advise the House as to what that figur e would be? MR. SCHROEDER: I'm sorry, I still don't have that numb er but I'll try to have it to the member before the end of the week. MR. SPEAKER: The Honou rable Member for Fort Garry. MR. L.R. (Bud) SHERMAN (Fort Garry): Mr. Speaker, my question is to the Honour able Minister of Health.

I would like to ask him if he can confirm that Children's Hospital will remain as is and where it is, that is as a separate facility and a separate identity on the Health Scie nces Centre campus? 1170 MR. SPEAKER: The Honour able Minister of Health. TABLING OF DOCUMENTS HON. LAURENT DESJARDINS (St. Boni face): Mr. Speaker, there has been no change as I explained yesterday. This was at the staff level and nothing has been approved or even placed in front of the board of the hospital or the commission. Mr.

Speaker, I would like to table also at this time, if I may, a letter from the President of the Health Scien­ ces Centre to the Editor of the Winnipeg Sun as king him to retract remarks that were made in the news­ paper this morning. I don't think there's any need to read it. There's also a letter to myself from the Presi­ dent and a press release that the Health Sciences Centre made this morning and if I may - do I have to read ,the press release? That will give the best answer. I'll table the whole thing. "Co ntrary to what has appeared in recent stories in the Winnipeg Free Press and su bsequently carrred by

Tuesday , 6 April, 1982 other media, the Children's Hospital is alive and well at the Health Sciences Centre. Construction of the five-storey $1 1 million building at Sherbrook and William is prog ressing on

schedule with an anticipated completion date in December of 19 83. Simul taneously, discussions are under way with the clinical department heads and senior manage­ ment at the Health Sciences Centre on the planning of the H.A. building, the major component of the Cen­ tre's redevelopment prog ram. These groups are reviewing various program alternatives and options for H.A. and the balance of their redevelopment pro­ gram and were asked to express to the Plan ning Depar tment any concerns or sug gestions they may have on the concepts being developed.

This was intended to be an internal review for the development of a final plan for consideration by the HSC Boar d and the Man itoba Health Services Commission. Unfortu­ nately, wide distribution of a memo prepared by the Head of the Department of Child Health lead to a totally erroneous front page story in the Winnipeg Free Press regarding the status of the Children's Hos­ pital within the Health Sciences Centre. The plan for the Children's Hospital building now under way, as approved by the HSC Board and the Government of Man itoba, have not been changed.

This building is presently und er construc tion and will house 13 0 pediatric in-patient beds as well as child­ ren's clinics. Steel gir ders for this building will soon be evident, as is obvious as the activity within the construction site has been since September of last year when the sod-turning fort he H.C. and H.S. build ­ ing were celebrated." So, I'll table the whole package. ORAL QUESTION Cont'd MR. SPEAKER: The Honour able Member for Fort Ga rry. MR. SHERMAN: Mr.

Speaker, I thank the Honour able Min ister for that information, but in view of the anxie ­ ties and the shaken morale that has resulted as a consequence of the reports in the past few days and in view of the fact that there still are considerable rum­ our s swirling about the Health Sciences Centre and particularly the Children's Hospital and I'm sur e that the Minister is aware of them and I can assu re him that I am personally aware of them.

Would he consider making a statement confirming that it is the intention of this govern ment, as it was of the previous govern­ ment, that Children's Hospital be maintained as a separate identity in a separate facility, and that integ­ rity will not be compromised? MR. DESJARDINS: Mr. Speaker, I think for the moment the statement made by the Health Sciences Centre and the statement that I made in this House today and yesterday will suffice. I would like to tell the honourable member that we certainly will review the whole situation.

This caught me by su rprise yesterday and I intend to, if at possible, if ready and I hope I'll be ready, to have a five-year program for construction. That will be reviewed during the Estimates and I would gla dly want to discuss this with my honourable 1171 friend and any other members of the House at that time. MR. SHERMAN: One final supplem entary, Mr.

Speaker, I wonder if the Minister would confirm thai first phase redevelopment of the Health Sciences Centre is set and that the kinds of delays and frustra­ tions that were created by wrangling and revision for many years - I lay the blame at no one's doorstep, two gov ernments lived through it -t hat kind of delay and frustration will not be permitted to resurrect itself; that if there is to be wrangling and revision, it should be with the second phase redevelopment, but the first stage redevelopment is set and will go ahead as scheduled. MR. DESJARDINS: Mr.

Speaker, I'm sure if my hon­ ou rable friend had been asked that question a few years ago he would have said absolutely not, and we see what happened throug h no fault of my honour­ able friend. Now, I'm not going to make a statement that I'm not sur e what is going to happen, I'm saying that we haven't changed any thing, that I'm reviewing it. I would want to look at the whole situation and if it takes too much time we will speed it on.

We will do something and I have requested the information - the money that is being spent so far on planning at the Health Sciences Centre - and I want to giv e this information to share with the members of this Hou se during the Estimate review. But as far as the intent of my honourable friend's question, I have no difficulty with that at all, but as my honour able friend knows, you can't really control everything at all times, so I can't make the statement that will not happen. MR. SPEAKER: The Honour able Lead er of the Opposition. MR. LYON: Mr. Speaker, I have a question for the First Minister.

I wonder if he could advise the House as to whether or not he has received from the Mani­ toba Cattle Prod ucers Assoc iation a request to have a meeting with himself and with the members of his Cabi net in order that the Man itoba Cattle Producers Association, as they say in their letter, can familiarize themselves with the provincial Cabi net, their goals and ob jectives. MR. SPEAKER: The Honour able First Minister. HON. HOWARD R. PAWLEY (Selkirk): Mr. Speaker, I would have to take that question as notice, I have not received it personally. There may be one that has arrived.

I know that the Minister of Agr iculture has already met with the Man itoba Cattle Producers Assoc iation twice, three times, so that indeed there has been consider able representation that has been made. MR. LYON: Mr. Speaker, I can well appreciate what the Honour able Fi rst Minister is saying. Perhaps it would be helpful for him if I laid on the table of the House for his benefit and for the record the communi­ cation which I take it all members of the House have received, dated the 24th of March, explaining the make-up of the association and explaining the mar-

Tue sday, 6 April, 1982 keting recommendations of that assoc iation about which I was questioning the Minister of Agricultur e jus t a few moments ago . So, f should like to lay that on the table of the Hous e; it might be helpfu l to the First Minister. MR. SPEAKER: The Honour able Member for Tuxedo . MR. GARY FILMON (Tux edo): Mr. Speaker, my questiorl is for the Premier. I wonder if he could tell us if his office is still responsible for the Information Services Branch. MR. PAWLEY: Yes, Mr. Speaker. MR. FILMON: Mr.

Speaker, I wonder if the First Minis­ ter could indicate who in his office is responsible for final approv al of the news releases which emanate from the branch. MR. PAWLEY: Mr. Speaker, in connection with news releases, individual Cabi net Min isters as sume responsibil ity for particular news releases that are issued in their individual names. MR. FILM ON: Mr.

Speaker, in view of the fact that the news releases that were released last Friday have a numb er of photog raphs, some of which are captioned as follows, there's one here that says: "The legislative representative, shown left, include the mover of the Add ress for the Sp eech from the Throne, Da uphin ML A John Plohman, second from right." If I'm not mistaken, although I do realize that they look a bit alike, it is the Member for The Pas who did in fact move the Speech from the Throne.

Perhaps the Pre­ mier might like to get the two of them together and decide which should sha ve off his moustache so that we can avo id the confusion in the futu re. As well, ther� is another photograph, Sir, which includes you and it indicates that it's a presentation of a Red River cart to the retiring Omb udsman, and it identifies the pe ople in the photog raph as your self and Mr. Ma ltby and it says: "M rs. Maltby is shown with her husband and the Speaker" and there only appears to be two people in the photograph. My ques­ tion, Mr.

Speaker, is this any indication of the effi­ ciency and the accu racy that we can expect from the Information Se rvices Branch now that it's under his personal control? MR. PAWLEY: Mr. Speaker, the Honou rable Member for Dau phin and the Honou rable Member for The Pas are both good-looking gentlemen. I might mention, Mr. Speaker, that they both, because of their good looks, tend to resemble one another and therefore I'm not particularly su rprised that somebody might have misunderstood one for the other under the circum­ stances. Mr.

Speaker, on the other hand, I'm not about to try to explain why the second picture the honour­ able member referred to sugge sted my presence when, indeed, I wasn't there except maybe because I' ve tried to cover too much of the field and ju st hap­ pened to be not there at that particular moment. MR. SPE AKER: The Honour able Memb er for Pembina. MR. ORCHARD: Thank you, Mr. Speaker, my ques­ tion is for the Minister of Agricultur e. Did Bill Janssen, the former Deputy Minister of Agricultur e, who is now on contract with this govern ment at $5,0 00 per month plus expenses have any

part in the drafting of the Beef Supp ort Progr am? MR. UR USK'.I: Mr. Chairman, he along with other people within tht! department did take

part in develop­ ing this prog ram. MR. ORCHARD: Thank you, Mr. Speaker. So, now we have confirmation from the Minister of Agricul­ ture, who at least one of these un named advisor y sou rces so knowledgeable on the beef commun ity in Man itoba are, and I would ask the Minister of Agricul­ ture if he believes that Mr. Ja nssen now enjoys the same 76 percent of nonsup port among the beef pro­ duc ers of the province today that he enjoyed in 19 77? MR. SPEAKER: The Honour able Member for lnkster. MR. DON SCOTT (lnkster): Thank you, Mr. Speaker. I have a question for the Minister of Envi ronment.

Yesterday, we had questions regard ing the atmos­ phere of this House being rather pungent at the time. I note now that it is quite clean. I'm wondering if the Minister has taken any action or if all the members have taken a shower this morning. MR. SPEAKER: The Honour able Minister of North­ ern Affairs. HON.

JAY COWAN (Chu rchill): As the members can tell arising from the question from the Honour able Member for Swan River yesterday and the questions from members on this side previous to that in private, I had requested the Workplace Sa fety and Health Divi­ sion to investigate the odou rs which were being expe­ rienced in the Chambers. They found that a coal-tar pot and asphalt opera­ tion, as part of the roofing operation which was ongo­ ing on the building, was put close to one of the vents, and they have had the vent tu rned off, and therefore, the smell which was emanating yesterday is not with us today.

However, there is a reduced air flow in the Chambers and I mu!lt warn the members opposite that may have some impact and influence on their thought process, but the fact is that we have removed the sou rce and the method by which the fumes were entering the Chamber - we have not removed the sou rce, and I'm to und erstand it will be six weeks before the operation is complete. Dur ing that time, the Workplace Safety and Health Division will be mon­ itoring the air in the Chambers to ensur e that we do not have an occurrence such as we had the other day.

If, in fact, that does happen, I can assu re you that we will take qu ick and prompt action as the Workplace Safety and Health Division did in response to this very serious concern. So I wish to publicly commend them for their quick action and on behalf of all the members in t�e Chamber, thank them for their decisive action. 1172 MR. SPE AKER: The Honour able Memb er for Turtle Mou ntain.

Tuesday, 6 April, 1982 MR. RANSOM: Mr. Speaker, a numb er of questions have been placed to the Minister of Transportation concerning the return of abandoned rights-of-way to su rrou nding landowners. The Minister had indicated some days ago that he would treat individual requests on an em ergency bas is and he further indicated that he had not received any such requests.

I would ask the Minister if he can now advise the House whether or not he has received individual requests because I have here copies of some seven letters which have been directed, I believe six of them, to the Minister of Transportation and one to the Minister of Agricultu re. Can the Minister advise whether or not he has received these letters and if he will be treating them on an emergency bas is? MR. SPEAKER: The Honur able Minister of Govern­ ment Services. HON. SAM UEL USKIW (Lac du Bon net): Mr.

Speaker, the letters in question I have not seen, but it's logical that is so in the sense that the letters are funnelled directly to the responding agency, and the respond­ ing agency at the moment is not in a position to respond because of a policy review which I indicated to the member on two or three occasions. When that review is completed, that response will be made unless, indeed, there are circumstances which require immediate attention in which case I'm prepared to look at those, Mr. Speaker. MR. RANSOM: Mr.

Speaker, that places the citizens of the province that have an interest in this matter in a very difficult set of circumstances because I have here one letter that is dated the 15 th of March and is directed to the Honour able Minister of Transporta­ tion. How does one get to have contact with the Hon­ our able Minister of Transportation if he doesn't read his mail? This is dated the 15 th of March and the Minister has advised the House, I believe on two separate occasions, that he will treat requests of this nature on an emergency basis. My question is, Mr.

Speaker, will the Minister of Transportation read his mail? MR. USKIW: Mr. Speaker, the letter being dated March 15 th, of cou rse, is not a dated piece of information. MR. RANSOM: Mr. Speaker, will the Minister give the House an und ertaking that he will ask his staff to provide him with letters that have come in dealing with the question of abandoned rights-of-way and that he will then treat those letters in the manner that he has advised the Hous e they would be treated, and that is, on an em ergency basis and dealt with so that these farmers are able to plan their operations for the upcoming year? MR.

SPEAKER: The Honour able Member for Morris. MR. CLAYTON MANNESS (Morris): Thank you, Mr. Speaker. I asked the Minister of Transportation a question yesterday regar ding a list of names, if he may be prepared to disclose as to who would be representing the gov ernment in any rural meetings 1173 regard ing the Crow rate issue, and he gave me an answer in the House, an answer that I found a little bit confusing, if I cou ld read it back to him.

He says, "I believe the House Lead er intends to make an annou ncement with respect to a presenta­ tion to the members of the Assembly out in Room 254 and that time, of cou rse, members will become more knowledgeable as to who is involved and who will indeed, if they have some sugge stions as to who should be involved and beyo nd that group, I'm willing to take that advice, Mr. Speaker." I found the answer a little bit confusing. I'd like the Minister, if he cou ld, to clarify three things.

The pend­ ing announc ement, with what will it be dealing, and why in Room 254, and what group is he specifically referring to? MR. USKIW: Well, Mr. Speaker, perhaps the member was not here, but we did try to get an indication from members opposite whether they would ag ree to the giving up of their Private Members' Hour tomorrow in order that my departmental people can make their presentation on the technical aspects of the study in Room 254. Perhaps he didn't get that message yes­ terday. We are awaiting a response. Perhaps the House Leader has a response. I'm not aware of it. MR.

SPEAKER: The Honour able Member for Arthur . MR. DOWNEY: Mr. Speaker, to the Minister of Ag ri­ cultur e, in view of his earlier answer saying that he has appoi nted or is going to have a livestock committee looking at the purchasing of feedlots in the province or getting into the feed lot busi ness, who is he employ­ ing to look into that particular aspect of the agricultu­ ral industry? MR. URUSKI: Mr. Speaker, it appears that the Con­ servatives have dirt in their ears, that they can't hear in terms of the replies. Mr. Speaker, the Member for Arthur - I have made no such answer, Mr. Speaker.

The committee that will be established will be estab­ lished to, as I have said before, deal with the technical aspects of the plan in terms of levels of supp ort, num bers of cattle to be insur ed, and the Mar keting Commission, those kinds of aspects will be dealt with; but the sole question that he put is jus t absurd. MR. SPEAKER: Or der please. The time for Or al Ques tions has expired. ORDERS OF THE DAY ORDER FOR RETURN - NO. 7 MR. SPEAKER: The Honour able Member for Turtle Mountain. MR. RANSOM: Mr.

Speaker, I move, seconded by the Member for Arthur , that an Or der of the House do issue for a return of the following information: ( 1) a list of all contracts for goods or services termi­ nated since November 30th, 19 81 , and prior to the expiry date, or not renewed or extended at the expiry date; (2) the goods or services being provided in

Tuesday, 6 April, 1982 each case; (3) the reason for terminating or not renewing the contract; (4) the contracted price contained within each contract; (5) will that good or service now be obtained else­ where, and if so, from whom, what costs and on what terms; and (6) will the goods be provided or service performed by gov ernment employees and if so, at what total costs and how is that cost calcula ted? MR. SPEAKER: The Honour able Government Hous e Leader. MR. PENNER: Mr.

Speaker, again this order or motion suffers from the same problem of draftmanship as some of those yesterday and sub ject to it being understood that it's from November 30th, 19 81 to today; so that we have a time limit, I accept the order. MOTION presented and carried. MR. SPEAKER: The Honour able Govern mentHouse Leader. MR. PENNER: Mr. Speaker, I move, seconded by the Honour able Minister of Financ e, that Mr. Speaker do now leave the Chair and that the Hous e resolve itself into a Committee to consider of the Supply to be granted to Her Majesty.

MOTION presented and carried and the House resolved itself into a Committee to consider of the Supply to be granted to Her Majesty with the Honour ­ able Member for Flin Flon in the Chair for the Depar t­ ment of Agricu lture and the Honour able Member for The Pas in the Chair for the Depar tment of Hig hways and Transportation. CONCURRENT COMMITTEES OF SUPPLY SUPPLY - HIGHWAYS AND TRANSPORTA­ TION MR. CHAIRMAN, Harry M. Harapiak (The Pas): Committee come to order. We are in the Department of Highways and Transpor tions, 1. (d)

(1) Transpor ta­ tion Division: Salarie s - the Member for Pembina. MR. ORCHARD: Mr. Chairman, last night we were getting into rather an interesting topic and that being the Crow rate issue and I sup pose debate as it's now warming up in all parts of the prairies, and last night I had basically questioned the Minister as to the va lue of some of the information tha t he has released in terms of adding positively to the discussion of the Pepin proposal.

Particu larly my ques tions were cen­ tered around the last piece of information that the Minister tabled, I believe, yesterday which indicated the cost per permit holder by district at a series of multiples of the Crow rate. The Minister indicated that this was necessary to demonstrate what the costs would be, I believe, in 19 90. The Minister indicated this was to provide information then to give the pro­ duc ers an indication of what their shippir'lg costs will be up to 19 90. I' d like to know how a producer, who may ava il himself of that three-page docu ment, is to derive that kind of information?

Where is the reference on that indicating that this is the cost as of 19 90, and which would be the costs in 19 90; wou ld it be at statutory; would it be at three times; would it be at four times? MR. CHAIRMAN: Mr. Minister. MR. USKIW: Mr. Chairman, depending on what takes place with respect to the legislation that is introduced in the Hous e of Commons in October or November as is proposed by the Minister of Transpor t for Canada.

If the assump tions are correct that the Government of Canada will limit its contribution to a level which they have indicated to us, or at least in their proposal; and if the assump tion on costs as developed by Sna vely are correct; and if there are no methods through which the producers will receive a benefit that will in effect reduc e their cost of shipment of grain to ports in Canada, then by 19 90 the factor is 9.7, assu ming that the $61 2 million of federal sup port is going to be maintained.

If it is not maintained, then, of cou rse, it will be more than that, and if the 61 2 is divided up amongst all produ cers of ag ricultural products as opposed to grain producers, it will be more than that. Those are majors "ifs," and which will only be deter­ mined, I presume, by the and throu gh the consu ltative processes that are now un der way as between Mr. Gilson and the various interest groups.

All we can give is an illustration for pu rposes of discussion as to what the costs would be given cer­ tains times per Crow, and whether in the end after this dialogue is over we end up with a proposal that is three times Crow, we will know what that means. If we end up with a proposal that is four times Crow, we will know what that means, and so on. The tables that are before you and are before the community as a whole are tables that will be qu ite handy once we know what the federal proposals are.

It will be very simply at that stage to be able to deter­ mine on a producer basis just where they fit in, given the fact the information package we have provided for them. That even cou ld be varied if the Government of Canada changes their mind in a major way from the direction that they are now taking. That is a possibil­ ity, and that is the possibility that we are driving for through the dialogue; but in the meantime we can only present to the public the figur es and assump­ tions that have been proposed to us by the Govern­ ment of Canada, and tha t's all we can work with, is what they have told us.

The y've also given us state­ ments that can be read in different ways and that's why we are not certain as to all of the assumptions. MR. ORCHARD: The Minister made mention of a fig­ ure of 9. 7 times Crow by 1 990 in his last answer. Could the Minister indicate where in the package of informa­ tion developed in Man itoba that figur e appears? 1174 MR. USKIW: It's in the information package I believe, Mr. , Chairman. I believe that you do not have the specific fig ur e on that, Mr. Chairman, but our analysis along with the Sas katchewan analysis is ver y clo se; althou gh our s was befor e the

Tuesday, 6 April, 1982 Pepin proposal was enunc iated. MR.

ORCHARD: Now the Minister in explaining the rationale behind the sheet he handed out, the three­ page sheet he handed out on Monda y of this week, indicated, is my count didn't go astray, about seven "ifs," and these "if s" were very very important "if s" to arrive at any kind of an objective analysis on what the future impact on the transportation rate may be to the producer and my criticism of this kind of information that the Minister handed out on Monda y is that none of those ifs are identified, there is no indication that this is a maybe set of figures that may come about if several things happen in the stage of the negotiation.

What, clearly, a piece of information like this does is cloud the issue when it's not identified as part and parcel an attachment to this, a fou rth page to this, as to the assumpti ons under which the Statutory rate by three may be the rate. I sugge st to the Minister that this type of informa­ tion does nothing to add to the objective questioning and debate that many producers are now entering into.

It does not answer any of the questions that the produ cers want to know because I sub mit with all respect to the Minister that it doesn't add ress the issue; it doesn't present facts that can be correlated to the issue that we have; it doesn't explain any of the parameters un der which those figu res are developed; and for all intents and pu rposes is a waste of tax pay­ er's money in reproducing those three figur es.

If that is the kind of information - and by information one would have to ass ume factual information - that the Minister will present to the grain producers wanting answers, I sugge st that piece of information is us e­ less. It doesn't add ress any of the issues; it doesn' t explain how the figur es were developed and it doesn't answer any of the questions, nor give any answers.

It does create, however, something of a fear cam­ paign for anybody who locates themself in District No. 3 and if he listens to the Minister who jus t said that 9.7 times Crow is the rate by 19 90, that individual producer would go to the sheet and mu ltiply 651 by 9.7 and say, hey, this is going to cost me $6,200. 00. But the Minister cannot today answer how he arrived at the 9.7.

He has no idea as to whether the 9.7 is a factual analysis, it is a gue sstimate and I think with all due respect to the seriousness of the debate and the issue, that the Minister should at least say, not cost per permit holder, but projected cost per permit holder, if a number of scenarios come true. That would make this mean something. As it is, it is a piece of information which will not clarify the debate, which doesn't add facts to the debate, but does add fear to the debate, and I think that's the premise under which some of the opposi­ tion to the Pepin proposal is based on.

It's trying to stir up a lot of fears about income loss which are specula ­ tive, and I don't think the Minister wants to have a debate go on througho ut the province, and indeed the prairie s, based on half truths and inue ndo and specu lation. MR. USKIW: Mr . Chairma n, the half truths and innu endo and speculation can more be attribu ted to the statement of the last five minutes, because I had indicated yesterday, and in all of the statements that 1175 were made that all of these assump tions are based on the Pepin proposal.

Now, if there's a deviation from the proposal as a result of negotiations, then of cou rse everything changes and we all accept that •. but given the proposal that is before us, then we know where we are going to be in a given period of time if we assume that the produ cers must pick up that differential in costs; and inherent in that assumpt ion is that we will continue to have inflation and that is an "i f," Mr. Chairman.

When I spoke with some people from the railways not too long ago, they said, well, we jus t can't assum e infla­ tion; we've got to wrestle inflation to the ground and therefore maybe it won't cost the producers any thing. Well, you know, I' ve been watching us wrestle infla­ tion to the ground since 1 939 and we haven't got there yet. So when someone says, well, the salvation to the farmers is that the government must bring down infla­ tion, that's not a good enough answer in our time because we know that the inflation factors in trans­ portation have been ru nning at arou nd 1 5 percent a year.

So it's all right to say that, get the monkey off our back, we want compensatory rates, inflation factors and costs that are passed on ha ve to be borne by someone else. So far, the someone else in this scena­ rio is the producer and it doesn't suffice to argue that yes , if we got rid of inflation, then the producer will be protected, because I don't believe anyone expects that tomorrow we are going to reduce inflation to a nil position, Mr. Chairman.

Now, the only thing that will change in this set of figu res if we are able to get a better bargain, so to speak, out of the system, and in particular out of the Government of Canada, is that the 4 or 5 or 10 times Crow rate won't happen as soon as is projected here. It may take 15 years rather than 1 O if we strike a better deal on who is going to pick up the inflationary increases year after year, but it's going to be there notwithstanding. It may take longer to get there.

So economists and analy sts can only work with the information that is given to them as to costs, as to inflation rates, as to the federal proposal on dollar input agai nst those costs, and that's all we have to work with. Those are our terms of reference, Mr. Chairman, as presented to us by the Federal Minister of Transpor tation . . . MR. CHAIRMAN: The Member for Pemb ina. MR. USKIW: No, I'm not finished, Mr. Chairman.

And the useful ness of the information that we put together for the benefit of the dialogue, in my mind, is in the fact that by having this information and these possible scenarios and probable scenarios before the publ ic, we may su cceed in improving those scenarios to the benefit of people in Man itoba because it is a proposal that we're dealing with. It is not fact. MR. CHAIRMAN: The Member for Pemb ina. MR. ORCHARD: The Minister indicated that the han­ dout was predicated on the Pepin proposa l.

Could he indicate where in the Pepin proposal there is a refer­ ence to the farmer paying five times the statutory rate?

Tuesday, 6 April, 1982 MR. U$KIW: Well, Mr. Chairman, ag ain I want to refer back to what I jus t said a moment ago and that is we have Pepin proposal before us; as to their input what the analysts have done is ripped that apart and brought it back to us in the form of cost per bushel per year. The proposal is there and I'm going to refer to Item 3 of the Pepin proposa l.

While the govern ment is prepared to bear a su bstantial part of the cost of grain transportation in futur e years, its resources are limited and increased contribution by grain produ cers will be required; that's Item 3 of the Pepin proposal and before that is his package of proposals of financial commitment in glo bal dollars to the system. Then, you have the Sna vely cost projections; you su btract one from the other and you know what the difference is. It's strictly an arithmetical exercise, Mr. Chairman, that is involved.

Now, no one has argued those analy­ sis, no one with any competence has argued that analysis or ag ainst that analyses, Mr. Chairman. So, given those assump tions and that proposal this is what comes out of the model - now, that doesn't mean that the assump tions won't be changed given some deg ree of concession on the part of some of the actors - but, that's what this dialogue is all about; is to win that concession. So, we have to lay the figur es on the table as we know them today based on today's information; out of that will come, hopefully, some concession in our favour. MR.

ORCHARD: Then, since the Minister is taking a proposal and making assump tions as to what may happen and developing figur es on the basis of his assump tions on wha t may happen; would it not be extremely beneficial to all those receiving his infor­ mation package to have it clearly indicated on any piece of paper such as what the Minister tabled on Monday. That these are assump tions which may take place if certain things happen and not present them in the light that this is what will happen. Period. That's my concern.

We want to assur e, as the Minister does that the very best arran gement is made un der this proposal. We want to make sur e that the farmers are informed as to what the potential is but to develop information that does not have a clear bas is - like I cou ld go through the Pepin proposal and develop probably a five times worse scenerio than the Minister if I so desired; but, I think it's incumb ent upon the Minister to indicate that these are assu med, that this information on the rates is predicated on making cer­ tain assump tions of things that haven't happened yet, that may happen.

That they're predicated on assump ­ tions drawn from a proposal made ratherthan attempt to leave the clear impression that these will happen.

I sug gest to the Minister that is the impression that a person who would receive this three piece handout from yesterday, that the Minister tabled yesterday; that if a producer was to receive that in the mail and then hear a voice clip from the Minister saying that by 19 90 freight rates are goi ng to be 9. 7 times the Crow rate, that farmer would go to this chart, pick his dis­ trict and say, "He y, this is what it's going to cost me." And I think that the Minister can not say that because he doesn't know what's there and I think it incumb ent upon the Minister to indicate that these are potential scenarios.

They may happen, it may be a greater impact but we cannot present this as factu·a1 informa- tion to the people who are interested in this whole discussion when it's presented as the Min ister attempted Crow to present it yesterday. And I would only ask the Minister if he would consider making one extra explanation on these sheets saying that these figur es are developed making assumptions such and such, such and such, and they may be what the pro­ ducer has to pay, and not the clear indication that they will be. MR. USKIW: Well, Mr.

Chairman, the fact is that they will be un less we get some concession from the Gov­ ernment of Canada. And that is based on the proposal that we have before us, a proposal which has been su bject to analysis by the Department of Transpor ta­ tion, or the transportation division of this department. That's an analysis out of the proposal. Now, the member wants to arg ue that our analy sts aren't able and capable of determining the futur e based on the facts that they had, he can make that argu ment, Mr. Chairman.

I don't want to spend too much time on that, because anyone can question the competence of the analyst, that's fair ball. I happen not to question the competence of the analy sts. I believe they know what they are doing, they've been there a long time, they know how to do these things. And they have extrapolated for our benefit the impact of the pro­ posed changes that were giv en to us as information by the Minister of Trans port for Canada. Those are the ar eas, or I should n't say those, the proposal may change, which will alter all of these figur es, Mr.

Chairman, but that goes without saying because we must deal with the proposal as it is in order to attack the proposa l. If the proposal is revised or changed in some way, that reduces the impact, we will have won our battle at least in

part if not in whole. And we must operate on the premise that we have, and that is that the proposed revisions in the transpor­ tation charges to the producers, as we know them, will have this impact. Now that's up to the Minister of Transport of Canada to change our mind about that. It's not up to us to speculate whether or not he will change his mind. And that's what the Member for Pembina is sug gesting. That there's room for negotia­ tions and therefore if we su cceed in the negotia tions then these figur es are not accu rate.

Well, you know, that's a very weak position from which to debate the point with the Minister of Transport for Canada. It's our job to make sur e that we bring him to a position of not living up to these expectations. That's what the dialogue is all about. 1176 MR. ORCHARD: Well, Mr. Chairman, there is no question on my part that the ana lyst who developed this developed the figur es very accu rately. There's no question that the analy st has developed the fig ures correctly. Wha t I'm questioning is the method by which the Minister presents them captioned as "C ost Per Permit Holder." MR.

USKIW: Based on the five assumptions. MR. PRCHARD: But where are the five assumptions? The five assump tions are not here. It says "Cost Per Permit Holder," not potential cost per permit holder if the five assump tions turn out correct and that's the

Tuesday, 6 April, 1982 point I'm making. We can argue it all day and we're not goi ng to change any minds, but I sug gest that the Minister is not presenting any thing correctly when he doesn't indicate that these are potential and much su bject to change, sub ject to the coming about of certain facts which he ass umes are going to happen. There's a lot of "i fs" in there. Now, Mr.

Chairman, can I ask the Minister if point No. 3 that he quoted ju st a few minutes ago, namely, "Wh ile the gov ernment is prepared to bear a su bstan­ tial part of the cost of grain trans portation in futur e yea rs," what does the Minister ass ume from that statement? MR. USKIW: Mr. Chairman, before I get on to that one, I want to indicate to the Member for Pembina that he is indeed misread ing this document that he says is misleading, because the document merely gives us an illustration of what it would cost a given producer in a given crop district at five different rates.

It doesn't say when they are going to happen. MR. ORCHARD: But you indicated yesterday that it would by 19 97. MR. USKIW: That's right, I had indicated that if the negotiations don't bring greater concession that that's where we will be by a certain date and that's a mere projection of this, that's all it is. But this document here which the member is objecting to merely giv es an illustration of what actual costs would be given a multiple of two, three, one, five, or four, whatever, times the existing Crow rate in a giv en crop district and it's a useful tool.

It may not in fact occur if Pepin says tomorrow that I' ve decided that the Government of Canada's going to maintain the Crow then all of this is garbage, good information to have but it doesn't mean any thing; nothing will happen of it, Mr. Chairman. Or if Pepin will say, well it's too much to expect the produc ers to pay, nine times Crow by 19 90, so I'm going to put in another $.5 billion into the pot of tax payers money so that it'll only be three times or fou r times Crow or whatever you see, and that's exactly the game we're in.

Bu t this is certainly helpful information in terms of the discussion that is going to take place, whoever talks about the multiple of Crow whether it's Pepin or whether it's Gilson or whether we do. It doesn't matter who raises the point. If they say, well it looks like it's goi ng to cost us two times Crow, given what we have been able to negotia te then the farmer will look this docu ment up and say, well in district one two times Crow is going to cost me $1 200.00. It's a helpful aid in the discussi on. No one said that this is what is going to happen because we don' t know what is going to happen.

That depends on the negotia tions that take place. Now I would n't mind if the Member for Pembina would giv e us an indication as to whether or not he feels, or his group feels that there ought to be a shift away from Crow and to what extent. The Member for Pembina indulg es in questioning the analysis that has been prepared or in the way that it's been prepared, but so far we haven't heard from him or his colleagues ju st how they view the issue. They have yet not 1177 defined a position, Mr.

Chairman, on whether or not the existing statutory rates should be maintained or whether it should be modified and to what extent it should be modified, I have not heard them make any comment in that regard. So, Mr. Chairman, I am not goi ng to accept for one moment the theory that per­ haps there's something wrong with the analysis that has been done by the depar tment. I don't believe I would want to indicate in that way that I have no confidence in the analy tical abil ity of staff that has been with us for some period of years. MR. ORCHARD: Would you care to answer my second question? MR. USKIW: Oh, yes.

All it implies here is tha t the Govern ment of Canada is indicating in advance that we cannot expect that they will add to the sub sidy program, that their finances are limited and that pro­ du cers are going to have to pick up a greater share. That's all that indicates, Mr. Chairman, and that is fair comment. I mean govern ment's don't tend to -well at least I think they don't tend to - offer completely open-ended subsid ies in these areas.

There are limitations that have been placed before and are in place today and which accord ing to that statement will be in place after the change s are brought in, but we don't know those limitations excepting for the analysis that has been done which appear to be somewhere in the order of $61 2 million is what it comes down to. Now, if we are su ccessful in getting more than that then it will reduce the nega tive impact. MR. ORCHARD: Mr.

Chairman, I take it then that the Minister is not varying from the statement he made last night that the $61 2 million that has been broached I believe by the Federal Government as being the necessary funding to close the Crow gap bas is 19 81 costs, the Minister still believes that $61 2 million is only being offered by the Federal Government for a period of four years. MR. USKIW: No, I didn't say that, Mr. Chairman. MR.

ORCHARD: Of cou rse, we don't have Ha nsard before us and I may stand corrected ifthe Minister did not allude to that, but does the Minister believe that the $6 12 million is a commitment basis the Pepin proposal that he tabled and that we all received in Februar y, does the Minister believe that $61 2 million is a commitment into perpetuity to the grain transpor­ tation system by the Federal Government? MR. USKIW: Mr. Chairman, because of the dialogue that has already taken place in the Province of Sas­ katchewan on that very point.

The Saska tchewan govern ment took issue with the fact that was not a commitment as it was worded in the Pepin proposa l. Pepin has responded by sa ying that it is a commit­ ment, but it was not in his package. It was an annou ncement sub ject to the public statements that were uttered in the Province of Saskatc hewan. MR. ORCHARD: Would it be possible that it was an assumption that the Federal Government assumed

Tu esday, 6 April, 1982 would be made similar to some of the assumptions the Minister is making to develop some of the figur es? MR. USKIW: No. The assump tion on that one would have to be that the govern ment would not want to put more on the table at any one time than they had to and that was a bit of a concession. MR. ORCHARD: Then it seems as if in recent discus­ sion this Minister has received the indication from the Federal Minister that the $61 2 million is a commitment on into the futu re, it doesn't have a termination date.

Would the Minister attempt to have the Federal Gov­ ernment clarify jus t what they mean in No. 3 because I must ad mit that I naively assu med when the Pepin proposal was tabled that the $6 12 million didn't have a four-year ending date as apparently has now been clarified and was su spect for awhile.

But I am ass um­ ing that No. 3 means that the Federal Government, in this negotiation process that's going on with the Gil­ son task force, call it that, with the producer grou ps, is to det ermine what future contribution to the cost increase ab ove the base year 19 81 that the Federal Government will make, which would be in addition to this $6 12 million that they have said is committed for the futur e with no foreseeable end. To me No. 3 reads that they are going to pick up - let's ju st throw a figur e out on the table - 50 percent of the futur e cost increases after 19 81 .

Now I think the Minister is con­ cerned that that may not be so. But could the Minister attempt to have that clarified from the Federal Minis­ ter to determine whether my assump tions as to the meaning and others is correct or incorrect? MR. USKIW: Well, first of all let me correct the members impression. I did not indicate that we had a commitment from Pepin on the $61 2 million. I said that there was a public statement that we are aware of that appears to commit him to that.

The only thing that will commit the Government of Canada to that level of supp ort will obviously be a statutory provision, and until we see that, there is no commitment. That's really where it sits. Until we see that it's a negotiable item, and therefore it's important to negotiate with the best interests of our producers in mind in order that we, if that is the level of commitment that at least it be statutory. But our position is that we should retain the present arrangement which is quite different. MR. ORCHARD: And the

interpretation on the futur e cost increase? MR. USKIW: Ag ain I want to remind the Member for Pembina that we are not in any process of negotia­ tions. We're not involved in the Government of Can­ ada. We are not a party to the consultative process. We can give opinions, make statements, ask for clari­ fication, but we are not party to the consu ltations that are taking place. MR. ORCHARD: Exactly, the Minister has said that they'r e not party, that the province is not party to the negotiation and I appreciate that.

But the Minister did indicate that they can ask for clarification, and that is what I am as king the Minister if he would d.o because I only lay out the scenario. Origin ally, the Pepin pro- posal seemed to indicate the 61 2 million was a com­ mitment to perpetu ity. That was brought in to some doub t, that has been clarified.

Origi nally, I believe that most people who listen to the Pepin proposal believe that No. 3, in his proposal, indicated that the Federal Government was going to negotiate via the Gilson task force a sharing formula involving the Federal Government, the produc ers and the railroads, as to futur e cost increases. Now, the Minister, I believe, has some concerns that the $61 2 million is it, and that producers will have to pick up the entire costs from 19 81 on, whatever those cost increases of moving grain might be.

And I merely ask the Minister now, could he ask the Federal Minister for clarification on point 3, as to whether it means that the Federal Gov­ ernment hopes to gain a recommendation from the Gilson commission on a Federal Government sharing of futu re cost increases? MR. USKIW: Well, Mr. Chairman, there's no doub t that we are continu ally attending to elicit more and more information from the Government of Canada. That is matter that we have not been able to refine in the discus sions that we have had. That doesn't mean that it would not occur.

But if you look at the consu lta­ tive process, it raises the question, the futur e respon­ sibility of paying grain transportation costs. You know, you can interpret any thing into that question. You can interpret any thing into the item that says the manner in which the govern ment will expend it's con­ tributions. You can giv e it the broadest

interpretation or you can give it a very narrow

interpretation. That is something that will have to come out of the Gilson Report and until we see what that is, we are not in a position to finalize our position. We will not be in a position to do that. And ag ain, we must remember that whatever the Gilson Report is the govern ment is not bound by it either, so it's still a process that does involve a major amount of interfacing with the Gov­ ernment of Canada. And that has to happen as between the producers of grain in this coun try, from the point of view of an ag ricultur al interest and the Government of Canada.

It's not going to be resolved by Provincial Govern ments writing letters or having meetings; it will only be resolved by the fact that produ cers will get involved and some determination will be made. But in that process it's important that the producers have all of the information that is avai lible in an analy tical way so that they can present their views to the Government of Canada with as much weight, if you like, that they might muster given the information that is ava ilable to them. MR.

ORCHARD: You know, the Minister ju st ans­ wered a question he previously put to me, in that he jus t said that his government cannot sup port or not suppor t what comes out of the Gilson Commission until they see what comes out of the Gilson Commis­ sion. I submit with all due respect to the Minister that neither can the members of Her Majesty's Loyal Opp osition be asked to determine a position on some­ thing that doesn't exist. 1178 We don' t know what Gilson and his task force is going to recommend as an equitable resolution of this whole deba te and that is why, Mr.

Chairman, over the past couple of sittings of this Committee I' ve been

Tuesday, 6 April, 1982 trying to get a little clearer hand le on what some of the implications of the Pepin proposal are, and that is why I jus t asked the Minister a few minutes ago what he believes is meant by Item No. 3 in the Pepin proposal because without clarification of that to myself, and without clarification of that to the producer organiza­ tions that are appearing before the Gilson Commis­ sion I don't know how they can make a factual presen­ tation.

I believe that each and every one of those orga nizations should probably approach the Gilson Commission making the assumption that $61 2 million is a commitment with no end.

They should go in with the assump tion that the Federal Government is as they say in No. 3, prepared to bear a su bstantial part of the cost of grain transpor­ tation in futur e years, and sugge st to them that they pick up 99. 9 percent of it to establish the strongest barga ining position but without clarification, and I believe that the Minister of Transportation in the Prov­ ince of Manitoba is the man most likely to get clarifica­ tion from Pepin on this proposal. That isn't making a representation to him; that isn't becoming part of the negotiation; that is simply asking for clarification on the proposal.

Do es it mean that the Federal Government wants to have a recommendatio n from the producer groups as to how much contribution they should make in the future to future cost-increase after 19 81 and really, I would sup pose, without having a clarification that the Federal Go vernment intends not to pick up any por­ tion of the futu re costs? I'm going to work on the premise, as I hope the producer group s are, that the Federal Government is going to and what we're talk­ ing about is trying to figur e out the percentage.

That's why if the Minister cou ld get some kind of an indica­ tion from the Federal Minister as to what the intention is of No. 3, it would go a long way to helping further the rational debate and rational presentations by our producer groups to the Gilson Commission to come up with the best possible proposal for the producers of western Canada. MR. USKIW: Mr. Chairman, what the member is ask­ ing for is precisely what is intentional ly left out of the Pepin proposal. Ambigui ty in the proposal is desig ned in order to leave the door open so that they can move one way or the other.

That is the whole purpose of the way it's structured, and that's where the flexibil ity is sup posed to be in the dia logue with the Gilson group, Mr. Chairman. We indeed pursue d every aspect of their proposal for three hours on a one-to-one basis, Mr. Chairman, -(In terjection) - very vag ue ones. Mr. Chairman, the member knows that a proposal is on the table, and that you are not go ing to pin down the Federal Government on any thing that is precise. They talk in generalities and they talk about a consul­ tative process, and then they're going to give you the legislative scenario at the end of that process.

Whether it was myself, or whether it was the Member for Pem­ bina, or the Minister from Ottawa, we would all func­ tion in the same manner, so let's un derstand the pro­ cess, Mr. Chairman. One thing that is known with the proposal is that the produc ers will have to pay more money for haul ing gra in. One thing that is known is that under the pres­ ent statutory provisions they do not have to pay more.

That is a fact, so what we are doing is taking away a protection that has been in place for the producers of grain on the prairies for many, many years and replac­ ing it with a provision statutory that will guar antee to the railways a return on their investment. We know what the switch is; the switch is away from protecting the producers to protecting the railway interests. That's the switch in law, so we know who the loser is, Mr. Chairman. The member wants to argue about whether we can qua ntify the amount of the loss and try to pin some­ body down on figur es. Well, Mr.

Chairman, he's whis­ tling Dixie because we won't know that decision until the final bill is before parliament, and we won't know that decision until then because of the very kinds of discussions that we're having here and in the town halls across the prairies and the interfacing that's taking place between various groups and the Minis­ ter, and between various groups and Mr. Gilson. That will all come out in the wash at the end, but to argue all of that, Mr. Chairman, is nonsense because we know what the trade-off is.

The trade-off is protection for the railways, removal of protection for the producers, and that is a trade-off in principal we should fight. If it's reasonable to arg ue that the railways need statutory protection, wherein is the lack of logic in argu ing that the farmers ought to have statutory protection? Somehow we've had statu­ tory protection since 18 97 and it is proposed we do away with it as far as the farm interest is concerned, but now we need statutory protection forthe railways. It's qu ite a tu rnaround , so let's not fudge the issue.

We know what's goi ng on and it's a matter of principle that we ough t to dig our heels in and the amount is here nor there, although to the extent that it's a greater amount it will have greater neg ative effects on our economy and we have qua ntified for members here and for the general public the amount of negative impact given various scenarios. That has been done for us by the previous ad ministration through the stu­ dies that they have commissioned, Mr. Chairman. It wasn't done by us. We are using you r analy ses. Per­ haps you don't have faith in your own work, Mr. Chairman. MR. ORCHARD: Mr.

Chairman, the Minister is now starting to skate. The Minister indicated he had a three-hour meeting face-to-face with Mr. Pepin. Did he get a vag ue indication from Mr. Pepin that they intend to pick up a proportion of future cost increases? 1179 MR. USKIW: No. MR. ORCHARD: Did the Minister get a vag ue indica­ tion that they would not pick up any portion of futur e cost increase? MR. USKIW: Mr. Chairman, the three-hour deba te that we had or discussio n was a rather friendly dis­ cussio n.

The Minister of Trans port for Canada can be a tremendously persuasiv e individual, and he has been able to move in that way in a numb er of areas. I used to call him a snake charmer. He happens to be a very impressive figur e; he tries to put a case forward in a very positive way, but he's not the type of person that anyone will ever pin down on a specific at that

Tuesday, 6 April, 1982 level. I app reciate the point and for the right reasons, Mr. Chairman, so for the member to try to extract from me that kind of precision on that discus sion, I'm sorry, I can't satisfy that desire, Mr. Chairman. That's not the way these things function. MR. ORCHARD: Ju st a couple more questions, Mr. Chairman. The Minister keeps bringing more ques­ tions up every time he giv es me one of his snake charming answers, But, Mr. Chairman, then clearly in the three-hour discus sion, did the Minister ask the Federal Min ister about futur e cost increase and whether they would be shared? MR.

USKIW: Mr. Chairman, we were told many times that they must guar d the federal purse over and over and over agai n, that while we are appreciative of the impact of these changes that there are no limits on federal spendi ng, and they were worried about whether they're going to get locked into greater spending if the Crow stays, if the railways don't per­ form. I mean the concerns are on the other side of the ledger. The concerns are how do you reduce Federal Govern ment sub sidies? How do you balance the books in Ottawa? Those are the concerns. Let's put it in its proper perspective.

We know what happens when Treas ury Board decides that the Fed­ eral Government has to balance their bud get or attempt to come closer to a balan ced bud get. Unless you have statutory protection in law for things of this nature, you don't have it. It gets chopped off at any time. MR. ORCHARD: Mr. Chairman, the Minister still didn't answer the question. Did he pose that question to the Federal Minister of the Federal Government's intention to bear a portion of futu re cost increases? MR. USKIW: Mr.

Chairman, we had asked a million and one questions and we did n't receive a direct answer on most of them, for the right reasons, and I'm not fau lting the Minister of Transpor t for Canada. They have put a proposal on the table in a very general way, it's up for discussion and that's the level at which it's being discussed. You will not be able to pin down the Minister of Transp ort for Canada until they have arrived at a position and that will be sometime next October. MR. ORCHARD: Mr.

Chairman, I may be missing something in this whole debate, but it seems to me that it's pr etty key to the whole discussion process that Gilson is going through, pretty key that one ques­ tion be answered, and whether the provincia l Minister cannot answer it, if he can't and he didn't discuss it, that's all I want to know. But to me it's pretty key as to whether the Federal Government in the proposal has an intention to pick up a portion of futur e costs, and if the Minister did n't discuss it with him then I supp ose I can fau lt him for not asking a very important question.

If he did dis cuss it with him and he got a no, a yes, a maybe, that's all I want to know. If he discussed it with him, did the Minister say, definitely they are not going to pick up, possibly they might pick up, or yes they will pick up. There's got to be one of the three. It's got to be yes, they will pick up a portion, no, they"won't pick up a portion and were considering it. That's all I want to find out from the Minister. If he doesn't have the answer, if he wasn't able to get the ans wer from the Federal Minister, then fine. MR. USKIW: Mr. Chairman, we are jus t repeating ou rselves.

The Minister knows that this isn't the way these kinds of discussions take place. One is never in a position to get that kind of a specific response. General discussions, yes, but they are not going to be specific when they themselves are at least indicating that there is some room for dialogue. They are not going to be pinned down on figur es or dollars or length of commitment or whatever. Out of that dia­ logue, not with myself, but with the Saskatc hewan people, came the sort of clarification of the commit­ ment on the amount of subsidy per year which was not in the original document in specific terms.

So, that is the way in which these things happen, and I believe that in the cou rse of the next several months before the legislation is introduced that the Pepin group will be listening to the concerns that are expressed on a whole host of issues with respect to that proposal, some of which they will take into account and do something about, some of which they will totally ignore. That is what this is all about. We are in that process. MR. CHAIRMAN: Another question, the Member for Pembina or ... MR. ORCHARD: Yes, indeed. MR.

CHAIRMAN: Because you r questions have been repe titive for the la st little whil e, you'r e not contributing ... MR. ORCHARD: Mr. Chairman, I submit that that doesn't really involve you. 1180 MR. CHAIRMAN: It certainly does. MR. ORCHARD: No, it doesn't. We're discus sing the Crow-rate issue and if questions are opposed and answers are given, we can ask for a clarification of the answer which is what I have been doing, Mr. Chair­ man. Now, if that's out of order, then I sugge st yo u're trying to muzzle the Opposition and I don't think you'r e trying to do that, Mr. Chairman.

I believe you'r e a much fairer parliamentarian than that. MR. CHAIRMAN: But your questioning is repetitive. MR. ORCHARD: Fine , if you would allow me the cou rtesy of one more question, you might not find it repetitive. MR. CHAIRMAN: The Member for Pembina. MR. ORCHARD: Thank you, Mr. Chairman. Mr. Chairman, the Minister indicated that certainly specif­ ics on numb ers were impossible and I ag ree. He indi­ catec;! earlier that a principle is being changed from protection for the farmer to protection for the railway.

I think that the question I' ve been asking him is not one of numb ers, but one of principle, the first princi

Tuesday, 6 April, 1982 pie being establ ished in further discussion that the Federal Government intends to continue the $61 2- million suppor t. The second principle of discus sion, and it's a principle, is whether the Federal Govern­ ment intends to bea r a portion of future cost, and I don't think any meaningful discussion can take place un less the principle of whether they're prepared to pay futu re costs is answered.

If the Minister didn't get an answer, whether that principle was part of the Federal Government negotiation, then I su ppose he can say, he did not, but I think it is pretty key to any discussion whether the principle is there and does he know whether the principle of futur e cost-sharing is part of the federal proposal? MR. USKIW: No, Mr. Chairman, there is no commit­ ment that we are aware of that they are prepared to enga ge in cost sharing beyo nd their commitment that we are also aware of.

Secondly, we are also aware of the fact that dur ing the process of consu ltations, it is qu ite possible that will arise, but that is a matter of Government of Canada policy and to the extent that we are su ccessful in bringing that about, we will benefit from that su ccess and to the extent that it occu rs. But we are not in a position to quantify it at this point in time, or even to determine whether it will occur, but we hope that it will. MR.

MANNESS: I would like to key on that specific comment while it was made and the words were "spe ­ cific response" that you were unable to get from the Federal Minister and I'm going to try and obtain a specific response from this Minister if I can. So you are forewarned.

Is this gove rnment saying that regard less of what­ ever compromise is struck, if in fact one is struck, and personally I don' t rate the chances any better than 50-50 of there being one struck, but if there is one that Professor Gilson can give to the public at large as the representatives have agr eed to, can you see this government, your go vernment, negotiating at that stage, or in fact, will you continue to maintain your present approach, which is abs olutely no change?

I know as a province, we have been excluded from the negotia tions, although I'm sur e that words of those results or negotiations are coming down to you by some method. But, I'm wondering if this go vernment is waiting to hear the compromise that's being struck before it's prepa red then to say, we'll negotia te, or are they going to continue to say, absol utely no change? MR. USKIW: Mr. Chairman, one of the things that has to be taken into account is the fact that the member alludes to negotia tions between which groups? I mean, who are the negotiations conducted by, and for whom?

We're talking about Gilson interfacing with a numb er of leaders of farm organ izations, that's what we're talking about. I would go one step further, I would say that I would be satisfied with the results of a referendum on the issue. Although I might not ag ree with those resu lts, I would be satisfied with that. Bu t to go one further, let's assume that there was unanimi ty between the consu ltative partners, so to speak, the people representing the industry and peo­ ple representing the Government of Canada but that the result of that una nimity is a net economic decline to the Province of Man itoba.

I may still not suppor t that recommendation because of the economic impact that it has on the Province of Man itoba. Ju st because you are willing to give away a piece of our economy and you happen to represent a group of people out there doesn't mean that it follows that the government is prepared to give away a piece of our economy.

So in the end it has to do with cold, economic analysis as to whether we win or we lose on this one and so far we know that we are going to lose, based on all of the stud ies and reports that we have, no ma tter what adj ustments are made in the Crow rate if they'r e upward adj ustments; we know we're going to lose. MR. CHAIRMAN: The Member for Morris. MR. MANNESS: Oh, I think we're getting right to the heart of the issue now. Do es the Minister, the way he observes the whole situa tion, does he see -and he says whether we win or we lose -does he see any opportun ity to win at all?

Is there any compromise that can be struck that will have us staying even or winnin g, in his mind? MR. USKIW: Well, Mr . Chairman, we are not hung up with the fact that the Crow rate must remain and that the public must look the other way when, in fact, we know that there has to be a major effort undertaken to upgr ade railway facilities in Canada, but we believe there are other ways of doing that without tampering with the Crow, tha t's all.

We believe it's in the public interest to leave the Crow as it is, even if it meant public dollars going in, by way of capital supp ort, to the projects that have to be unde rtaken by the rail­ ways. We have no problem with that concept. We' re saying it's in the overall public interest to leave the Crow alone. 1181 MR. MANNESS: I want to be specific when you say capital dollars, public dollars. Are you talking specifi­ cally federal dollars or are you also leaving an opp or­ tun ity open for provincial dollars? MR. USKIW: Well, Mr.

Chairman, I would think that if we were to move in that direction that a numb er of provinces, along with the federal gove rnment; or at least they would be willing to go along with the Gov­ ernment of Canada in putting forward needed capital for railway expansion. We would want to take an equity position for havi ng done so. MR.

MANNESS: The Minister has made reference a numb er of times to taking the information out to the farm commun ity and letting those that have the most to win or lose -some people say the most to lose -out of this whole problem, letting them make the decision on the basis of all the information and I think he's made the comments in an analytical way, let them decide.

He also makes reference to a report that was done by Professor Tyrchniewicz for the previous go v­ ernment and I take it to believe that this will be the main analytical docu ment that'll sup port the govern­ ment in its argu ment that, in fact, no change should occur to the Crow rate or at least all the benefits that accrue to us. Is that a correct statement?

Tuesday, 6 April, 1982 MR. USKIW: Well, no, the correct statment is that we have no choice in the matter. It is up to the produc ers of this prov ince to make a determination and to have that determination conveyed to the Government of Cana da.

We are merely bysta nders in this exercise and all we are doing here is under taking some responsibility in the dissemination of information; making av aila ble the analysis that we have on that issue so that those that are going to make the deci­ sion, or the recommendations, or will be involv ed in the dialogue, will have as many pieces of factual information as are av ailable to us or to any one else; that's basically our role. MR. MANNESS: But, I detect something a little bit differently here.

I detect that in fact you 've taken from that report what you believe to be in a suppor tive fashion, tha t suppor ts your argu ment, the govern­ ment's argu ment, and you 're using it specifically. Is that a true statement? MR. USKIW: Well, what we're doing is using a report that was prepared for the previous ad ministration which does indicate the impact on Man itoba's econ­ omy, given a certain scenario on that question. That's there, it's factual information. I presume it's accua te, I have no way of knowing that it's not accu rate.

Our ana lysts have looked at it and out of that came up with a complete package of analysis and projections as they deemed to be the case. MR. MANNESS: Well, the key words, Mr. Min ister, were "I presume it is accu rate." MR. USKIW: Well, I'm not questionning it is what I'm saying. MR. MANNESS: I gue ss what you are saying and admitting is that possibly it is not accu rate in all accounts. MR. USKIW: Mr. Chairman, you can have a hundr ed reports, and you can have questions with respect to the accu racy of a hundr ed reports on the same sub ­ ject.

So, if the member wants to sugg est to me that there may be a component there that might have a varia tion factor greater than what was anticipated, perhaps it's there; I'm not the one to the the judge of that. We have given to you the best ana lysis that we are able to put together with the expertise that we have and that's all I can tell you. MR.

MAN NESS: Well in the information package and maybe later on we'll have a feel or get a better idea as to what is going to be prepared for the whole informa­ tion package that will be mailed out to producers, but would you consider an alternative approach to that specific report, in other words, a critique by some­ body that may not ag ree with the bas ic methodology used in that report? MR. USKIW: You see, Mr. Chairman, we're now into that scenario; then we need to have a critique of the critique. I mean there is no end to that process.

The previous gov ernment commissioned a group to do a study for them; brought in a report that wasn't to their liking; hid it under the blan ket for 1. 5 years; took a change in gov ernment to reveal it to the public and now they are saying, would you Mr. Minister hire a group to do a critique on the report? Well, you should have done that then if it was of concern to you. I don' t mean you, personally, but I mean the previous administration. The report is there, our analy sts have looked at it and have come up with a package of information based on that report and other information.

Tha t is satisfactory to me, Sir. If it isn't to you, I sugge st, that you get your research people within ycur structur e to do a cross-examination of that analysis and do what­ ever you wish with it; we are not going to do that. MR. MANNESS: I ju st want to then make sur e we un derstand each other.

Personally I see some glaring weaknesses in some of the methodology used in that report and, I gue ss, what the Minister then is indicat­ ing that, in fact, if those weaknesses are shown by somebody of our part, that in fact they will not be included in that information package, even though the Minister in many of his comments has said that producers should be given all the information. MR. USKIW: Mr. Chairman, inherent in that state­ ment is the assumption that whatever information you provide is, in fact, accu rate. I would raise a great deal of question about that, Mr.

Chairman, it may have a tremendous amount of bias. The report that I'm deal­ ing with is not our report, it is your report, therefore, it has no political bias from our side. What you'r e now proposing to me is that you prepare a report and we submit it in with that information piece as if it were neutral information. It would not be neutral informa­ tion if you'd brought it to the committee as part of the information package. 1182 MR. MANNESS: Well, Mr.

Chairman, I didn' t want to get into the specifics of that report and I won't move into it in too much detail, but I want to make the Minister aware, and obviously he must have read it a nu mber of times, but if he realizes the basic fou nda­ tion in that report has production in this cou ntry almost doubling by the year 19 90; does he honestly believe that in fact that will occu r? MR. USKIW: Mr. Chairman, the basis of production, and we discussed this yesterday - I believe the member was not here at the time -was the projections of the Canadian Wheat Board. I don't believe they will occur, qu ite frankly.

Personally, I don't think we're going to double our grain production in 10 years, although it may happen, but I don't think that's correct. MR. MANNESS: Thank you, Mr. Minister, for being that candid because I too, do not believe it will occur and of cou rse that Wheat Boar d analysis that came out some two years ago was severely - I won't say criticized - but severely reviewed and put through many tests, many rigorous tests and in my und er­ stCjnding through my sou rces was in fact rejected in many many areas.

When I see it now being the basic found ations for much of the Tyrchniewicz Report throtJgh the various scenarios, I then become a little

Tuesday, 6 April, 1982 dismayed as to what the information package will be.

To further develop another area on this particular project, I see by way of the report that the Minister tabled in the House yesterday regard ing the impact upon districts within the province, I also draw to his attention that, in fact, their basis on input-output ana ­ laysis based on 19 74 table, and if anybody with an economic background - and maybe possibly the Member for lnkster who has a thorou gh und erstand­ ing of input-output analysis - realizes the many many weaknesses involved in that area, I'm wonder­ ing agai n how confident the Minister is in the whole input-output analysis approach that bears upon and giv es us the num bers that he tabled yesterday as far as the regional breakdown in this province?

MR. USKIW: Mr. Chairman, I have to draw to the attention of the Member for Morris that he obviously hasn't studied that report at all or has ju st skimmed through it, because the Tyrchniewicz Report chal­ lenges the Wheat Board projections on production by the year 19 90. It throws out the argu ment that there will be a doubling of production. It is not based on that premise, as he sugge sted that it was. Perhaps I should repeat what I said. The Tyrchniewicz Report chal­ lenges the Wheat Board premise on the doubling of production. It totally disregards that.

It shows a reduction of grain production based on change s to the Crow. MR. MANNESS: Mr. Minister, I made also other ref­ erence on the whole input-output analysis based on the 19 74. I won't bother moving into that whole area right now. I'll pose that question in another part of your Estimates. But I'm wondering if I'm wrong in saying that on the question with the key issue, is whether all the grain that I produce and that the farmers of this province will produce, whether all that grain will move 10 , 15 years hence if there is no change in the Crow rate. Is that or is that not the key issue? MR. USKIW: Mr.

Chairman, I believe that we will move all of the grain that has to be moved to the ports when it has to be moved to the ports without chang ing the Crow. MR. MANNESS: That's fine and I'm glad to hear that statement. I haven't decided yet whether I share that feeling or not. MR. USKIW: As long as you'r e willing to change the Crow, you'r e right, it won't happen. The moment you are not willing to change it, it will happen. MR. MANNESS: I think I'll close off at this point. Thanks, Mr. Chairman. MR. CHAIRMAN: The Member for Pembina. MR. ORCH ARD: Thank you, Mr. Chairman.

On the su bject of the Tyrchniewicz Report, cou ld the Minis­ ter indicate whether the assumptions on which the Tyrchniewicz Report tabled its conclusions are indeed reflective of the Pepin proposal? 1183 MR. USKIW: Yes, the report is independent of the Pepin proposa l. It merely postulates a level that pro­ duc ers would pay given a certain circumstance. MR. ORCHARD: Thank you, Mr. Chairman.

If the Minister cou ld, could he indicate that the Tyrchnie­ wicz Report develops a series of dollar losses to the farming community based on the assu mption that the farmers, the producers, will have to pick up the entire cost of moving grain? MR. USKIW: No, jus t a model, Mr. Chairman, that giv es us a measu re. When we know the rate times the base rate that we will have to pay, the model tells us what the impact of that will be. It's a fairly neutral docu ment. MR.

ORCHARD: Well, it's a fairly neutral document, but does the Tyrchniewicz Report not come to the conclusion tha t if the farmers were asked to pay the compensatory rate which has been identified by Sna vely as 3.4 times the present Crow, that their losses would be X numb er of dollars? MR. USKIW: Yes, that's correct. MR.

ORCHARD: Is it not fair to say that the Pepin proposal has indicated that the $61 2 million they pro­ pose to put into the system represents that 3.4 times Crow in approxi mate figur es and that that is a Federal Government contribution which would not be paid by the farmer as was indicated in the analysis by Tyrchniewicz? MR. USKIW: Well agai n, it depends on the base you were to use, but at the cu rrent moment I believe the compensatory rate would amount to about five times Crow. MR. ORCHARD: Well, Mr.

Chairman, the Minister is tossing extra figur es in, but he is basing some of his factual presentation to the interested parties in this debate on the Tyrchniewicz Report which made the ass umption that the farmer in 19 81 would pay 3.4 times Crow and the reason for my first question was that this Tyr chniewicz Report would come to some­ what different conclusions in terms of loss of income should it have made the analysis based on the Pepin proposal of supplementing the grain transportation system by $61 2 million. MR. USKIW: Mr. Chairman, what the member is talk­ ing about is the base year.

The base year would be '81-82 with the $61 2 million in the package which is Crow rate, okay, 19 81 -82. MR. ORCHARD: That's a good rate. MR. USKIW: That's right. The total cost of shipment would be $751 million on a compensatory basis of which the federal payment would be 612 , of which the Crow revenues would be 13 9, so that's you r base year, it's one times Crow. But if you project that down through the years without any additional sub sidies to the produ cers, you do come up with a scenario that brings you into a multiple of 10 by year 19 90 or the-

Tuesday, 6 April, 1982 reabouts. Those are again based on assu mptions that cu rrent inflation rates will prevail and so on. If we had deflation, we might end up with something else. MR. ORCHARD: We'd get the money back. MR. USKIW: But given the cu rrent economic condi­ tions and not only cu rrent, but economic conditions that have been with us for many decades, that there will be an increased charge to producers each year, un less there are increases in sub sidy dollars. MR. ORCHARD: Thank you, Mr.

Chairman, and I think the Minister has indeed confirmed that the Tyrchniewicz Report made the assump tion that the farmer was going to essentially pay that $61 2 million. MR. USKIW: The Tyrchniewicz Report doesn't make any assump tion. It orily indicates that if you have a level of charges for transpor ting grain at one times, two times, three times or whatever, that certain things will happen. That's what it ass umes. MR.

ORCHARD: Right, exactly. that's what it assumes that the farmer would pay 3.4 times Crow which would be the entire compensatory gr ain rate, a scenario which with the Federal proposal doesn't exist, because the Federal Government has ag reed to pay that 3.4 times Crow multiple in the 61 2 million, so that the assumptions in the Tyrchniewicz Report are not bases losses in 19 81 or 19 82, but indeed would be reflective of potential losses some year down the road, when increased costs of transportation which may be borne by the farmer, come to bear in the transportation system.

So the result of the Tyrchnie­ wicz Report which is reflective when it was drafted and with the criterion it was analy sed on come to bear, they develop 19 81 losses, but those losses may never occur or may occur in 19 89, we don't know, because the Federal Government has changed one important criterion that we were not aware of when the Tyrch­ niewicz Report was drafted, namely that the Federal Government has indicated they will pick up the Crow benefit and pay it into the system. A cou ple of other questions, Mr.

Chairman, has the Tyrchniewicz Report been reworked or reanalysed to reflect, say, a 19 81 scenario bases the Pepin proposal, the $6 12 -million contri bution by the Federal Government? MR. USKIW: No, it has not been reproduced on the basis of 19 81 docu ment, but agai n, that is not an important point because all we're dealing with is eco­ nomic impact, given changes in transportation costs to producer s when they occur, so the model holds if you have those changes take place. The only thing that can change that is sub sidy input that will not allow that to take place. So, it doesn't matter as to its date. MR.

ORCHARD: So, then I take it from the Minister's answer that the Tyrchniewicz Report and its conclu­ sions have not been recalculated to reflect the $61 2- million contribution by the Federal Government in the Pepin proposal. MR. USKIW: It ha s nothing to do with the Tyrchnie­ wicz Report, the fact that the gov ernment is putting in $61 2 million. All that does in the scenario is brings us into a base-year position which says, okay, we'll gi ve the railways compensatory rate for 19 81 and it's going to cost the Federal Treasury 612 million and that's Crow.

After that. we will have one times Crow or two times Crow or three times Crow as the costs go up. That point is not relevant. MR. ORCHARD: Mr.

Chairman, I don't really accept the Minister's argume nt that's not relative, because the Tychniewicz Report and I don't have it in front of me, but if my memory serves me correctly, it indicated it did an income analysis of farming operations in the province bases paying only the Crow rate; bases pay­ ing 3.4 times the Crow rate; bases four times the Crow rate and it establ ished a series of net farm income losses to the farm community based on three sizes of farms in terms of 19 81 dollars. MR. USKIW: 19 78 dollars. MR. ORCHARD: Ok ay, '78 dollars but I believe - okay, we'll talk 19 78 dollars.

Is the Minister saying that all we do to determine the impact of the Pepin pro­ posal in 19 82 is simply· factor 19 78 losses by an infla­ tion rate, let's say the CPI, to arrive at a 19 82 figur e, and that will represent the losses to the farm commun­ ity bases the Pepin proposal? MR. USKIW: Mr. Chairman, I'm not sur e that's a worthwhile exercise. I don't know what the final num bers would be in terms of the change in costing and so on over the last two orthreeyears. What we are dealing with is what happens if farmers pay more than they are now paying for the transportation of their grain.

We don't care what the numb ers are, but are they going to pay 10 0 million more or 15 0 million more or 300 million more and all the way down the road. That is the relevant point. What the report indicates is that if you have a scenario of 3.4 times Crow, this is the impact on the economy bases 19 78 statistics. So, you can ju st transplant that into 19 81 and say, well this is the economic impact in 19 81 of 3.4. In terms of where we are, we will reach 3.4 by 19 84, in terms of additional costs. 1184 MR.

MAN NESS: The Minister made quite a point here when he said he believes that regardless if there's a change in Crow or change in anyth ing, the grain will move in 15 years. MR. USKIW: In which? MR. MANNESS: 10 , 15 years is the way I posed the question, all the grain on the farm would move. That was the way I posed the question. You said yes, you thought it wou ld. That's the way I un derstood your answer. MR. USKIW: What's this 10 or 15 years? MR: MANNESS: Well, 19 95 is 10 or 15 years. I'm wondering if he's that committed to that belief that he refuses ag ain, even though he says he's going to pro-

Tuesday, 6 April, 1982 vide all the information, to provide to the farmers of Man itoba what, in fact, it cost them through the years 19 78 and 19 79 when, in fact, all the grain did not move off the farm. I cou ldn't help but notice that was not mentioned at all in his presentation in the House when he debated the resolution the other day. Is that not vital information to help the farmers of this province attempt to determine, make up their minds on this whole issue or is it, in fact, extraneous to his whole belief that regardless of what is grown will move in a decade flow? MR. USKIW: Mr.

Chairman, as we move into the next decade and beyond, grain is going to become a very small, minute component of the overall tonna ges that are going to be moving across the rails, across this cou ntry from one coast to the other, a minute portion of the total tonna ge, each year a more minute por tion. It will not be that relevant in terms of total income to the railway system. That doesn't mean that the rail­ ways wouldn't like to relieve themselves of that responsibility, and it doesn't mean that they would n't want to detract from the importance of moving grain in their policy decisions.

But I believe that the government of this country will play a role, and that either the railways will, or there will be other means found throu gh the system of gov ernments and the railways to bring that about. That is already part of our history, Mr. Chairman.

That is already part of our history because it has to do with the many billions of dollars that have now been spent by the Government of Canada and, indeed, by some provinces on sub sidies to the rail system, the branch line subsid ies, the hopper car pur­ chases, and I can virtually predict that if there's a financial impasse, the time that they must put that line through the tun nels of the moun tains in British Columbia, that issue will be add ressed at that time by all concerned and it will happen, it will happen because the Ja panese need the coal; it'll happen because the Canad ians want to sell the coal and because they can not do it un less they have new trackage, double tracking, more horsepower on the rails, if you like, more port facilities.

It is all related to the question of coal, which is the dominant factor. Now that is not a secret. British Columb ia's on the other side of this issue because it wants to speed up that process of developing their coal industry and they say so, it's not as if it's a secret. We've had discus­ sions with the four western provinces on this issue and they do take the position, "Look, we need that rail line. We need to dou ble-track, we can't handle the tonnages through the mountains." It's got nothing to do with grain, Mr. Chairman.

But what do the railways say, "Our grain department doesn't make any money." We can go to the bank and say to them that we need so many billions of dollars because we have to dou ble­ track through the mountains of British Columb ia, because we have to buy more engi nes, and because we have to do something else. They will say, "Show us your cashflow on moving grain," and we can't show a positive return. That's the railways' argu ment. But they don't say that CPR in it's totality hasn't got a cashflow that will back up a bank loan, they don't say that at all.

They don' t want to allu de to that and this is where the relevance of history 1185 takes place, Mr. Chairman. The old deal that was made is important at this very point, because the railway system was encou raged to expand into a broader field of investment, as it was argued many many years ago in order to provide them with greater viabil ity so they could service the trans­ portation needs of this cou ntry without a direct charge on the people that are using the transportation syste m. That is what's been vio lated and is being viola ted in the proposal before us.

So let's not lose sight of where the argu ment is. The railways see this need to push for expansion of rail capacity. They have co-opted everyone that they can co-opt in this issue, and they are saying to them­ selves, "If we don't un load the Crow now we probably won't for the next 20 years, or 30 year s. Here's our chance to put the heat on and let's get rid of this thing because it's costing us a few dollars." CP Rai l additional annual net revenue, assu ming 19 80 grain rates as sugge sted by Sna vely - and this is an interesting figur e, Mr.

Chairman - out of total funds of $3 billion available to CPR, they will have additional revenues of $53 million dollars if they got the Snavely rates for 19 80 in moving grain. It's a min­ ute part of their total operation, Mr. Chairman, and it'll be more minute each year. So to argue that we're going to make it or break it in the CPR based on whether the Crow stays or goes is a bunch of non­ sense, and we are not prepared to be co-opt in that argu ment, Mr. Chairman. MR. MANNESS: Than k you , Mr. Chairman. Well let me go on record right now as sa ying, I do not dispute your comments regard ing CPR.

I don't think anyb ody in our party does. But the Minister has not answered my question. I asked him quite specifically whether he was prepared, in fact, to tell the farmers what it cost them by the Wheat Board's analysis of a grain system that was not properly in place in the late '70s. As irrelavent as grain may be to the CPR, as is the claim of the Minister, when Mr. Farmer in the constituency of Pembina or indeed in Morris is carrying over some 8,0 00 or 1 0, 000 bushels of wheat the cost is extremely relavent and there's a tremendous cost there.

I ask the Minister agai n, is this part of the information he'll be sending out to producers to tell them what the true cost is of maintaining unwanted inventory on that farm, nothing more? MR. USKIW: Mr. Chairman, that is not a relevant part of the scenario, because the railways have an obliga­ tion to provide a service which they have been in violation on for many many decades. And there is a parliamentary provision or a statutory provision that cou ld have been used to get arou nd that impasse, Mr. Chairman. The Governor of Canada chose not to use that.

The railways are using the crisis in transporta­ tion as a means or a lever to convince everyone that we should get rid of the Crow. We should do precisely the opposite, Mr. Chairman. We should not succu mb to that kind of pressure. Tha t is a tactic, and it's been used by many people throug hout history; it's nothing new. Let's squeeze it until we can squeeze out the ju ice, and you know there's nothing new about that scenario, Mr. Chairman. So, the railways are engaged in a high wire act

Tuesday, 6 April, 1982 with the people of Canada on this issue. But it is incumb ant on the Government of Canada to take them on on it. To the extent that they have been unable or unwilling to take them on directly, they have gone ar ound the issue, and they have provided boxcars, have sub sidized branch lines. I mean, the railways have scut tled the Crow a long time ago in that sense, Mr. Chairman, but the public has come in with an effort to upgr ade the system. Now, I am saying tha t we are qu ite open about tha t.

I'm saying leave the Crow alone; it will happen anyway and it will happen either through the railway system, or through a combina tion of public and the railway system, but it will happen because it's in the Canadian interest to make sur e that we maximize our export opportunities. We know it; you know it; the Federal Government knows it. To the extent that they don't deal with it, they are neglig ent in their responsibility, Mr. Chairman. And this is not the route through which it will happen. MR.

MANNESS: Poss ibly the Minister put his finger on it when he said to the extent that they do not take action, then it is their problem. But as the Minister is well aware we've had many reasons, or many non­ actions taken that have created situations whereby we're carrying from year to year unwanted inventories on the farm.

Whether it's because the government doesn't have enough muscle or enough will to force grain handlers back to work that seem to want to go on a strike at the most crucial times, or whether it rail­ ways that have slowed down, or for whatever reason, and threaten to put grain at the rear of all their priori­ ties as far as future movements, the Minister is sitting here and telling us that, in fact, not to worry; it's a false issue, that fact that the grain that we had a billion dollars to carry over through '78 and '79, tha t could have been sold, but it didn' t because of a handling system that was not efficient.

And he's telling us now that it's a false issue, that in fact don't worry that the grain will move. Am I right in that comment? MR. USKIW: Let me explain to members that should know this, in any event, that the movement of grain is not impeded by the fact that they don't have double ­ tracking in Western Canada, because the bulk of it moves to Thunder Bay. What is impeded is the will­ ing ness to get the grai n moved by way of supplying of adequate boxcars to roll into Thu nder Bay; it's nothing to do with the $15 billion that are needed to develop the trackage in Br itish Colum bia, that has to do with coal.

But it is being used in this scenario in order to extract from the farm community part of the capital costs of development in British Columbia. MR. ORCHARD: Thank you, Mr. Chairman. The Min­ ister was indicating, before my colleague questioned, that there hasn't been a reworking or an updating of the Tyrchniewicz Report which would now reflect, in 19 82 terms, the Tyrchniewicz Report and its implica­ tions on farm income. MR. USKIW: Mr.

Chairman, I indicated that that was totally irrelevant to the discussion; that we have the analysis which simply tells us, in economic terms, what will happen, given increased costs of transporta- tion of certain goods. It has not relevance to what we are dealing with, Mr. Chairman. If we know our costs are going to go up one times or two times or three times we can relate back to that and you can simply quantify it by inflating those figur es if you want to talk in 19 81 dollars. The model is the same, the dollar figures may vary but the model is the same. MR.

ORCHARD: Then I can assume from that answer that the Minister has not had an upda te of the Tyrch­ niewicz Re port which would reflect the Pep in proposal? MR. USKIW: The member should assume that the departmental people see no need in doing that because it doesn't furnish us with any new information. MR. ORCHARD: So, then there has been no update of the Tyrchniewicz Report? MR. USKIW: I am further advi sed that those kinds of figu res are not even available for another year so that if we wanted to do it we are un able to do it, Mr. Chairman. MR. ORCHARD: Mr.

Chairman, who is handling the disposal of railroad right-of-ways? MR. USKIW: Mr. Chairman, that is a matter that was brought up by way of questions in the Hous e which is at the moment in suspension, which I indicated in the House, because of a policy review, and that's a review jointly with Transportation and Agricultur e. MR. ORCHARD: Who is und ertaking that review on behalf of the Minister of Transportation? MR. USKIW: Mr. Chairman, that is a ministerial review, that is a policy review, it has nothing to do with staff. 1186 MR. ORCHARD: So, then, Mr. Chairman, we cou ld discus s that item here? MR.

USKIW: You can discus s it anywhere. MR. ORCHARD: Or we could discuss it under the Minister's Salary. Is Mr . Reg Forbes still working on the railway right-of-way disposals? MR. USKIW: No, I am told that Mr. Forbes is waiting for whatever new direction is forthcoming from the ministerial review process. MR. ORCHARD: Mr. Chairman, under the Transpor­ tation Division, Other Exp enditures, that has formerly been the area in which the WEST AC membership has been mai nt ai ned, is tha t st ill un der Other Exp enditures? MR. USKIW: Yes.

MR._ ORCHARD: Is the Min ister sa tis fied with the provincial involve ment in WESTAC and would he antici pate conti nuing tha t memb ership in sup port of WEST AC?

Tuesday, 6 April, 1982 MR. USKIW: Mr. Chairman, we have continued to be a member of that group and there is money in this Bu dge t for that pu rpose, in fact, it's an increased amount as I recall it. I' ve had only one opportun ity to interface with the groups that are members of that organiza tion. I sup pose it does serve some usefu l purpose in exchanging ideas and viewpoints, although I wasn't particular ly impressed with the meeting that we jus t had, and I don't mind citing the reason.

We had a presentation on the part of the CN R and CPR repre­ sentatives on the whole transportation question, hav­ ing to do with Crow as well, without a balance of interest group s sort of on the panel. We only had those two vested interest groups throwing their ideas and opinions across to the delegate body and it seems to me that was a bit of a one-sided approach to an issue that involves so many interest group s. So, I'm really questioning the format of that meeting, not questioning the organ ization, questioning the format of that particular meeting that I did attend. MR. ORCHARD: Thank you, Mr.

Chairman, I take it then that in this presentation by the two railway com­ panies that probably they went through the presenta­ tion of the projected tonnage movements of va rious commodities and the kinds of investment that was needed in facility upgr ading. MR. USKIW: Yes, and as I said a moment ago, they did get into the need for recei ving new revenues through the abolition of the Crow. But ag ain, I don't want to get into this because it is an in-camera meet­ ing, as the member knows, and it would be unfair on my part to get into the discus sions that took place in a definitive way.

I merely point out that I wasn't happy with the format that was employed but I really should not be discussi ng that particular meeting. MR. ORCHARD: I realize and I appreciate the Minis­ ter's position on that. Do you know whether the WES­ T AC organ ization will be undertaking, say in the next several months, that possibly more balanc ed discus­ sion forum on the Crow issue to try and present, as the Minister is concerned about the other side of the coin, so to speak, on the Crow debate, will they be und er­ taking that?

And the reason I ask is that, I think, may be it's changed in the last few months, but I think the WESTAC organ ization has been a fairly su ccessful discussion grou p in which some con