"7 ISSN 0542-5492 Fourth Session - Thirty-First Legislature Of the Legislative Assembly of Manitoba DEBATES and PROCEEDINGS 29 Elizabeth 11 Published under the authority of The Honourable Harry E. Graham Speaker VOL. XXVlll No. 598 - 8:00 p.m., THURSDAY, 15 MAY, 1980. REV ISED Printed by W. T.Matwichyna. Queens Printer, Province of Manitoba

MANITOBA LEGISLATIVE ASSEMBLY Thirty -First Legislature Members, Constituen cies and Political Affiliation Name ADAM, A. R. (Pete) ANDERSON, Bob BANMAN, Hon. Robert (Bob) BARROW, Tom BLAKE, David BOSTROM, Harvey BOYCE, J. R. (Bud) BROWN, Arnold CHERNIACK, Q.C., Saul CORRIN, Brian COSENS, Hon. Keith A. COWAN, Jay CRAIK, Hon. Donald W. DESJARDINS, Laurent L. DOERN, Russell DOMINO, Len DOWNEY, Hon. Jim DRIEDGER, Albert EINARSON, Henry J. ENNS, Hon. Harry J. EVANS, Leonard S. FERGUSON, James R. FILMON, Gary FOX, Peter GALBRAITH, Jim GOURLAY, Hon. Doug GRAHAM, Hon. Harry E.

GREEN, Q.C., Sidney HANUSCHAK, Ben HYDE, Lloyd G. JENKINS, William JOHNSTON, Hon. J. Frank JORGENSON, Hon. Warner H. KOVNATS, Abe LYON, Hon. Sterling R. MacMASTER,Hon. Ken MALINOWSKI, Donald McBRYDE, Ronald McGILL, Hon. Edward McGREGOR, Morris McKENZIE, J. Wally MERCIER, Q.C., Hon. Gerald W. J. MILLER, Saul A. MINAKER, Hon. George ORCHARD, Hon. Donald PARASIUK, Wilson PAWLEY, Q.C., Howard PRICE, Hon. Norma RANSOM, Hon. Brian SCHROEDER, Vic SHERMAN, Hon. L. R. (Bud) STEEN, Warren URUSKI, Billie USKIW, Samuel WALDING, D. James WESTBURY, June WILSON, Robert G. Constituency Ste.

Rose Springfield La Verendrye Flin Flon Minnedosa Rupertsland Winnipeg Centre Rhineland St. Johns Wellington Gimli Churchill Riel St. Boniface Elm wood St. Matthews Arthur Emerson Rock Lake Lakeside Brandon East Gladstone River Heights Kildonan Dauphin Swan River Birtle-Russell lnkster Burrows Portage la Prairie Logan Sturgeon Creek Morris Radisson Charleswood Thompson Point Douglas The Pas Brandon West Virden Roblin Osborne Seven Oaks St. James Pembina Transcona Selkirk Assiniboia Souris-Killarney Rossmere Fort Garry Crescentwood St. George Lac du Bonnet St.

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LEGISLATIVE ASSEMBLY OF MANITOBA Thursday, 15 May, 1980. Time - 8:00 p.m. BUDGET DEBATE MR. SPEAKER, Hon. Harry E. Graham (Birtle­ Russell): The Honourable Minister of Labour. HON. KEN Mac MASTER (Thom pson): Mr. Speaker, I want to thank you for the opportunity to participate in this debate. I rise, Mr. Speaker, with a great deal of pride in the budget that was unveiled the other night by my colleague, the Minister of Finance. It's a budget of which all Manitobans can be proud because it serves the best interests of all our citizens.

Th e reaction by the public has demonstrated this, the comments of the honourable members opposite, notwithstanding. Our government was elected on a solemn pledge to serve th e best interests of all Manitobans regardless of their occupation and no matter where they live. The responsible economic, financial, social and health care programming of our government has proved that we are doing exactly what our Premier and what we promised to do in 1977. This is the third budget by our government. You'll have to agree, Mr.

Speaker, that each budget has improved upon the last one, and that even our first budget, in my opinion, was a vast improvement upon any of the budgets fostered upon the people of Manitoba by the previous government. The economic climate of Manitoba and the financial responsibility of th e provincial go vernment have improved tremendously since 1977, Mr. Speaker. I think we sometimes forget the fiscal irresponsibility of our predecessors. I think their last deficit was around the 190 million mark. If we related that into today's dollars, it's probably equivalent to 220 or 230 million.

Contrast those figures with the 140 million deficit projected in this year's budget and the actual deficit could be much lower, Mr. Speaker. After all, last year's deficit was originally estimated at 123 million, and today, Mr. Speaker, it appears that the final amount will be substantially lower in the range of 45 million. We all know that deficits aren't just bookkeeping figures for the amusement of accountants. Deficits are bills which have to be paid; bills which have to be paid by the taxpayers of Manitoba.

I think it's remarkable the manner in which the present Minister of Finance and our government have managed to bring the provincial deficit under control. We are no longer, Mr. Speaker, being irresponsible in borrowing millions and millions of dollars to pay for our current operating expenses. That's the way our predecessors liked to do it. Rather our deficit is mainly for capital expenditures, which in my opinion is a legitimate and proper way to finance such things. Mr.

Speaker, I don't intend to spend a lot of my time detailing the numerous commendable contents of the budget, but it isn't easy to restrain myself in doing so. After all, just consider, just consider, Mr. Speaker, it's wide-ranging and positive impact on all people of our province, on the people after all who pay, Mr. Speaker, for the services and programs provided by their government. As the Premier likes to remind people, government doesn't generate any great amounts of wealth or revenue, rather government pays its bills by taxing the citizens whom it serves.

This Budget clearly illustrates th at we don't require excessive and onerous taxation to serve our citizens well. This Budget benefits our senior citizens; it benefits our lower income families and our business community; it benefits, Mr. Speaker, every citizen in Manitoba, even those who smoke and drink. Senior citizens have benefited with the doubling of the income supplement benefits for pensioners and by the significant increases in the school and property tax rebates. Our senior citizens have also benefited by the changes to the SAFER housing program. Nor have we forgotten those, Mr.

Speaker, who have retired earlier than the traditional age of 65. The reduction of the age requirement by 10 years for income supplement benefits and for SAFER is a mark of a government concerned about all its citizens. Mr. Speaker, one goal of our government has always been to provide provide funds for those programs and to those citizens who need them most. Prudent fiscal responsibility dictates we must do so because taxpayer dollars should not be squandered on make-work projects, just to massage the ego of a particular Cabinet Minister.

Taxpayer dollars must not be used to try and buy re-election of individual MLAs. I don't believe we sho uld sacrifice the economic well-being of our taxpayers. I'm proud, Mr. Speaker, to be a member of a government which refuses to trifle with the pocketbooks of its taxpayers and which refuses to squander money like it came from some Monopoly game. I know of no sensible Manitoban - and the resounding vote given our government in the last provincial election shows that most Manitobans possess buckets of common sense - who would object to a government's approach of directing money to those who most require it.

This Budget will accomplish that objective, as well as greatly benefiting many low income families. The 100 jumps in the property tax credit minimums and maximums will benefit all citizens, Mr. Speaker, whether they be homeowners or renters. As the Minister of Finance indicated previously, the net result of these increases will be that many homeowners, many homeowners in Manitoba, will be paying less in property taxes to th eir local municipality councils and school boards this year. Our go vernment also recognizes the special position of the low income families with child-related income support programs.

The CRISP bonus of 30 a month per child will make significant difference to tho se who qualify. The special rent subsidy is another example which illustrates that a government can combine, Mr. Speaker, can combine compassion and concern together with fiscal responsibility and sound management. The Budget and the White Paper underline the reality of more working parents. The 9.5 million budget for day care, as well as noon 3785

Thursday, 15 May, 1980. hour and after school programs, will be applauded by many. The members opposite like to decry the strong economy in Manitoba, Mr. Speaker. They seize on any scrap of data, no matter how insignificant it may be, and from that they try to generalize a landscape, a picture of economic woe. I think of the Member for Churchill who used his personal grievance this session to berate our government for supposedly not caring about job creation in northern Manitoba. Our government promotes employment opportunities for all Manitobans, wherever they live. You know that, Mr.

Speaker, and that's why we have aggressively pursued a policy of job creation in the private sector. A policy, Mr. Speaker, wh ich has been more successful than our friends opposite will ever admit. Our record speaks for itself; 11 ,000 new jobs during our first year in office; another 12,000 to 13,000 jobs during our second year. In each one of those years, we created more jobs than the NOP did during their last three years in office.

Yet the members opposite, often led by the Honourable Member for Brandon East, like to put on their pink-coloured glasses and pretend nothing positive and progressive is happening in Manitoba. I suggest they go and talk, Mr. Speaker, go and talk to the 24,000 or 25,000 Manitobans who are now working, and who didn't have jobs two-and-a-half years ago, because those jobs simply did not exist. Our government hasn't conjured those figures, Mr. Speaker; they come from the federal government in Ottawa. Another thing, Mr.

Speaker, is the private sector has responded in my opinion because of the progressive and responsible administration our government has provided. Many of the jobs are permanent; that's another factor which the members opposite do not like to admit. I have always been intrigued by the enthusia sm of socialists for believing government is the best job creator. Give us your tax dollars and we will create the jobs, they say. Of course those jobs likely will be merely substitutes for welfare.

Jobs with no economic justification; jobs wholly and totally dependent on the public purse; jobs whose sole purpose is to transfer people off the welfare rolls so that the socialists can pretend they have done something. They have done something to increase the economic independence of tho se receiving the jobs, and in addition, of course, it makes the unemployment figures look something different. Mr. Speaker, there are instances where local government projects of a temporary nature have in fact helped the community, also in fact, the workers involved.

I don't foresee any government abruptly ending such programs. However, it is economically blasphemy for members opposite to try and jump at any achievements in job creation in economic independence. The people of Manitoba pay, and they pay dearly because our predecessors dogmatically followed the notion that make-work projects are somehow economically vi able. The other day, the Member for The Pas asked about several make-work companies which were funded before our government took office.

The performance of those companies since th en illustrates the folly in calculating such jobs in their economic performance report. Mr. Speaker, I know that all Manitobans were heartened by the Minister of Finance's prediction that real growth in the provincial economy will be up approximately 2 percent this year; 2 percent is positive, realistic and a conservative prediction. Manitoba, after all, is not Alberta or Saskatchewan. We do not possess the petroleum and the natural gas resources of our western prairie neighbo urs.

However, I am glad that somebody in Canada owns such resources, because I would not want Manitobans or Canadians to be at the mercy of the OPEC nations. We are fortunate Canada has rich energy and mineral resources, and we are fortunate that in most instances we have free enterprise Conservative governments in charge of those resources so that our citizens may receive maximum benefits in terms of job creation, industrial development, and tax return. Although we don't have the energy resources of Alberta and Saskatchewan to fuel our economic growth, Manitoba and its people, Mr. Speaker, do have many strengths.

Many provinces envy the diversity of our economy, with agricultural, mining, and our broadly based manufacturing sector. Businessmen, union leaders, working men and women, and our Progressive Conservative government, know tha t Manitoba can grow and prosper. We have unlimited potential as an important supplier of goods in the development of the new west.

The Conference Board of Canada which forecasts a real growth of 1.8 percent this year for Manitoba says, and I quote: that Manitoba's fabricing industries are the most diversified of the four western provinces and that we may be in an ideal position to benefit from the strong primary sector of growth in Alberta and Saskatchewan. Mr. Speaker, we will be in that positi on. The policies of our government and the programs of the Minister of Economic Development are seeing to that. Our manufacturing

section will also be there to provide the necessary goods and services, as our other sectors like agriculture, mining, tourism, grow. Naturally all of us would like to see Manitoba Hydro resume its northern construction programs. However, most of us realize the quality of building just for the sake of building without markets for that power. Most Manitobans understand the fiscal irresponsibility of th e former administration in building a 40 percent excess capacity.

Our citizens now know that the northern Hydro extravaganza is costing th em millions of dollars annually in unnecessa ry interest rate payments, and they applaud our government for devicively acting to freeze Manitoba Hydro consumer rates for five years. Mr. Speaker, my friends opposite will protest that northern Hydro projects created jobs. Of course they created jobs, but at what cost to the taxpayers and the citizens of Manitoba? The Premier has often said, You don't buy five cars and put four of them in the garage, just because you know that at some future date, cars will cost more.

Yet that is exactly what the former administration did with Hydro. As a Manitoban who lives in the north, I don't just visit there the odd weekends since being elected, I especially want Hydro projects on the Nelson and the Churchill to begin again. However, I know that when it does happen, our government will ensure it is done on a responsible financial basis. Our citizens have paid too much already for energy which has no 3786

Thursd ay, 15 May, 1980. buyers, for government-made airplanes which have no buyers, and for Chinese food that has no buyers. As I said a minute ago, Manitoba Hydro power projects means job creation, and when such projects are undertaken in a responsible manner, th e economic importance of those jobs must not be underestimated. We are not talking just about several thousand jobs directly at Limestone, but we are talking about several thousand more spinoff jobs throughout the province in terms of goods and services, which any development will require. Just think, Mr.

Speaker, how much worse the NDPs weak job job creation record would have been without Hydro, and how much better our superb record would have been with Limestone. Think also, Mr. Speaker, about what fiscal responsible Hydro development in the north will add to the economic progress of our province and what it will do to our already low unemployment rate. As members of this House will recall, in December the seasonally adjusted unemployment rate dropped to a three-year low. Last month, Mr. Speaker, it was .7 percent less than it was a year ago.

When a government's policies can prompt the private sector to add approximately 24,000 new jobs in two years, th e provincial unemployment rate has to benefit. Some of the members opposite like to put on their pink coloured glasses again and try to convince themselves that unemployment is tied to population. In their minds, and in their minds only, a low unemployment rate is directly related to the size of the Manitoba population. So when the rate moved down, they howled that the reason for the drop was that people were leaving Manitoba.

However, when the rate fluctuated up slightly, the same members opposite didn't blame it on people coming back to Manitoba. Of course, Mr. Speaker, the silence of the members opposite was understandable. They had realized how foolish their first argument was and decided they would appear to be wiser if they kept quiet the second time round.

Of course, nobody with half an ounce of common sense would have made out that population tied to unemployment argument in the first place, nor would anybody with any degree of intelligence attempt to equate Manitoba's economic and social prosperity with the size of its population. Rather than belabouring that point at this time, I'd like to suggest to the members opposite that they read an

article on population in the recent edition of the Manitoba Business. It's written by a John McCallum who is on the Faculty of Administration Studies at the University of Manitoba. It might even enlighten my friend, the Member for Brandon East, who has a peculiar fascination with wha t is happening in the moving vans in the bedrooms of our province. Mr. Speaker, I was talking a few moments ago about northern Hydro development and its potential for job creation and economic growth in Manitoba.

As the Fina ncial Times reported in its recent extensive report on our province, one of Manitoba's major strengths as it enters the 1980s is its abundance of electricity and the price at which it can be offered to business. We all know that a proposed Western Power Grid is the key to a quick resumption of northern Hydro projects. I'm confident that the interests, the interests of all Manitobans and the future of Manitoba Hydro, will be safeguarded by the Minister of Energy, who also happens to be the Minister of Finance and the man instrumental for the excellent budget which we are now praising and applauding.

My department is actively preparing young Manitobans to be able to take advantage of the growing economic opportunities in our province. The Manpower division has begun significant new initiatives to increase the chances for young men and women to become skilled in the blue-collar trades. We have designa ted several more apprenticeship programs, such as the tool and die makers, power electricians and moulders. We are actively working to train workers for those jobs which we commonly refer to as critical skill shortages.

Relocations for northern native people taking jobs in urban centres is another way we are tailoring our efforts to help the more disadvantaged. As Minister of Labour and Manpower, I was particularly happy to see the sales tax removed from safety devices. Our government has pursued an aggressive program of Workplace Safety and Health since taking office. In fact the current legislation had only been in place for less than two months and it was our government which had to provide the responsible direction and

interpretation of that legislation. My department and the Department of Mines, recently sponsored a two-day conference on mine safety, held in Flin Flon, that drew representatives from unions, from companies, from the government; the Member for Flin Flon was present and the Member for Churchill was present. The conference was held just a few weeks after the Wright Report on Safety in the provinces mine industr y. My predecessor, who's now Minister of Cultural Affairs, had appointed the Wright Committee. It was another example of our government's genuine concern and interest in workplace safety and health. Mr.

Speaker, I can't help but comment tha t conditions didn't worsen October 11 , 19 77; conditions in the mines were identical two weeks before, three weeks before, a year before. What I am saying to you, Mr. Speaker, is, it was left to our government to establish a review of mine safety for the working men and women in that industry. It was left for our government to establish that review. As I told that conference in Flin Flon, safety and health in the workplace are very important to me and to our government.

Industrial growth and economic expansion, together with job opportunities which they bring, are also very important. However, our government does not intend to needlessly sacrifice the workplace safety and health of Manitoba workers. We know that employers, unions and workers share our sentiments. The Wright Committee made 77 recommendations for improving workplace safety and health in the mining industry. The Flin Flon Conference agreed the most practical way to use the report was to have a committee indicate the feasibility of implementing the various recommendations.

We're now in the process of establishing that committee, this committee which will have representatives from both unions and mining companies. It is important, Mr. Speaker, that these representatives be active in our mining industry so they will bring both experience and realism to the committee. 3787

Thursday, 15 May, 1980. Our emphasis, Mr. Speaker, has always been on voluntary co-operative action from industry and workers. I don't believe in the extra legislation and severe penalties if the volunteer approach will work. Simply put, I believe that voluntary is always better than compulsory. This belief, Mr. Speaker, has also determined the tone of labour relations in Manitoba. Mr. Speaker, both labour and management have indicated that they support this belief. They want to operate with the minimum of red tape and government restrictions. I should also mention, Mr.

Speaker, that we've recently established a review committee to review the Workman's Compensation procedures in Manitoba. I expect that report to come down shortly and I hope that it also gives this government the opportunity to take the ideas from working men and women in this province and implant them into different procedures that will benefit working men and women in the province. The dramatic turnaround in the province's construction industry exemplifies the success of this approach. My department provided the opportunity, the opportunity, Mr.

Speaker, for the leaders of the construction industry, from both unions and from management, to renew their relationship with each other. I asked Cam McLean, the Chairman of the Joint Labour and Management Review Committee to establish a special construction industry sub­ committee to try and deal, Mr. Speaker, with the mistrust and the hatred which had built up over the last few years and which had exploded in the devastating 1978 strike. My department sponsored a seminar at Hecia Island and took 10 leaders from both sides out to that particular seminar for a few days.

However, the new beginning would not have happened, would not have happened, Mr. Speaker, without the voluntary participation and sincere commitment of the union and the company officials. They braved skepticism and ridicule. This year's bargaining wasn't easy but, Mr. Speaker, an agreement has been obtained without too much blood-letting around the bargaining table. Mr. Speaker, the health care sector is currently in ongoing negotiations to try and resolve the thorny and tricky question of essential services during strikes or walkouts.

Our government is on record that we will not allow a labor dispute in the health care field to harm the life or limb of any of our citizens. Governments, Mr. Speaker, always have recourse to legislation in such disputes, of course, but nobody, I don't believe, Mr. Speaker, nobody likes to use it. I congratulate the union and the hospital leaders for their honest attempt to deal with this issue before the problem arises, and I wish them well. In closing, I would remind Members of this House that a very important vote is scheduled for next Tuesday in the province of Quebec.

As the Premier has indicated, this is not the time for an extensive debate in the Manitoba Legislature about the vital issues being addressed by our fellow Canadians in Quebec. I think our Premier and the Premiers of the other western provinces have precisely outlined western attitudes and sentiments on sovereignty association and the need for a renewed federalism in Canada. As the four western premiers agreed at their recent meeting in Lethbridge, for Canada to survive as a strong and united country, immediate steps must be taken to deal with the aspirations of all Canadians.

The Premiers also stressed the need for a new constitution that will accommodate the needs and concerns of western Canada and other parts of this country. They agreed that the objectives of such constitutional reform must be to ensure that all provinces have the opportunity to build upon their strengths and thus to share in and contribute to a united and prosperous Canada.

The western Premiers said they are prepared to consider a wide range of constitutional proposals, but they rejected the concept of sovereignty association because it means two separate countries with two separate citizenships and no common parliament. Our Premiers and our counterparts from Saskatchewan, Alberta, and British Columbia flatly stated they would not negotiate sovereignty association and said any other assumption is a dangerous illusion. On the other hand, Mr.

Speaker, the Premiers also said they would interpret a No vote on the May 20th referendum as a vote against separation and a vote in favor of intensive negotiations for constitutional change, because the status quo remains unacceptable to western Canadians, as it does to Quebecers. I hope that the message from our western Premiers has been correctly and adequately transmitted to the people of Quebec. It's a message which I fully support and which I know is fully endorsed by many other Canadians. It's a message which calls for flexibility in order for national unity to prosper.

I want to again quote from the communique of the four western Premiers. They agreed: Western Canadians hope that the people of Quebec and the people of the western provinces can continue to work together as members of Confederation, to contribute to and to share in the great opportunities and the potentials of Canada. With our country's vast size and enormous resources, the future of a revitalized Canada will be assured, united by a modern constitution, Canada can realize its potential as a leading nation in the world. The western Premiers were positive, optimistic, forthright with the people of Quebec.

I beiieve they know our feelings and our hopes to build a better Canada, and I'm optimistic that the majority of Quebecers want to build their futures within a new and dynamic and united Canada. Finally, Mr. Speaker, I want to echo the congratulations and sentiments of many Manitobans, and commend the Minister of Finance for a budget which will help to secure economic and social prosperity for all our Manitobans. Mr. Speaker, in closing, I would like to say to you, that if I was in Quebec, or had been asked to talk to people in Quebec, I would talk to them, Mr.

Speaker, about a young man like myself who started out in this country with very little, who had the opportunity to walk across this country and work at just about all aspects of society. I had the opportunities to work in Ontario, the opportunities to work in the Prairies, the opportunities to work in the logging camps and the pipelines in British Columbia. I had the opportunity to 3788

Thursday, 15 May, 1980. sail for five years in the Navy and to tingle as I left Canada to go to a foreign port, and tingle more when I came home. I have had the opportunity, Mr. Speaker, and I would share this with Quebecers, the opportunities of a man who nothing really to start with, who ended up in Thompson, Manitoba 20 years ago, got married and had the opportunity to be blessed with enough friends, to be a Cabinet Minister in the government of Manitoba. I would ask them to share this country with me and share the opportunities the country has. Thank you. INTRODUCTION OF GUESTS MR.

SPEAKER: At this time I would like to draw the honourable members' attention to the gallery on my right, where we have the St. Paul's Pack from Fort Garry, under the direction of Mr. T. Sale. This Cub Pack is in the constituency of the Honourable Minister of Health. On behalf of all the honourable members, we welcome you here this evening. BUDGET DEBATE (Cont'

d) MR. SPEAKER: The Honourable Member for Portage. MR. LLOYD G. HYDE: Thank you, Mr. Speaker. I appreciate the opportunity to particulate in this Budget Debate. I want to take this opportunity to congratulate the Minister of Finance and his staff on bringing forth a budget that will make the 1980s a decade of recovery of recovery and stability, a decade of opportunity and of promise for the people of Manitoba. Mr. Speaker, I want to go on record today in support of the policy decisions made by the Progressive Conservative Party of Manitoba for the 1977 campaign.

It was necessary that restrictive programs be implemented when we took over as government. I am pleased that this government can now take the measures to ease up on that decision now that the deficit column of the ledger is considerably brighter. Mr. Speaker, I am pleased that our government passed legislation to eliminate a few of the nuisance taxes that we found ourselves with. We eliminated the succession duties, the gift taxes and the mineral acreage taxes. These taxes were considered to be nothing more than just nuisance taxes. It is important to note, Mr.

Speaker, that while the huge deficit inherited by this government has been effectively reduced, reducing it has not been at the expense of the people of Manitoba. Simultaneously to the reductions in the government deficit was a reduction in small business corporate taxes and personal income tax, which provide a competitive tax base for the private sector in the province of Manitoba. Mr. Speaker, Manitobans will not be faced with a Hydro rate increase for approximately another four years.

This is one of the major incentives introduced by the Manitoba government, designed to curb inflation and stimulate economic development in our province. We know, Mr. Speaker, that this move to freeze the rates of Hydro was criticized by the opposition but I also know, Mr. Speaker, very well, that the farmers, the developers, the pensioners and the homeowners in this province can see that this government is not gouging their pockets for every penny. We are a government that has a heart, regardless of what the opposition say. Mr.

Speaker, I welcome th.e proposals for a western electric power grid that has been signed by the provinces of Alberta, Saskatchewan and Manitoba. This will create power sales in western Canada of up to 1,000 megawatts to Alberta alone by 1987. I feel that the initiative taken by this government in this area will provide an important economic thrust by providing jobs both at the construction level as well as the manufacturing level. Our economy will benefit considerably, Mr. Speaker, through the proposed mining development of our ore bodies at Flin Flon and potash at St. Lazare.

Our government must continue to work towards building a desirable climate for mining development and these announcements indicate to me that much has been accomplished. Recent private forecasts support our projects and suggest that Manitoba's real growth in 1980 will not only be above the national average but also the third highest in the country, ahead of all provinces except the major oil producers, Alberta and Saskatchewan. Mr. Speaker, the rational development of our hydro-electric resources is the first priority and, I am sure, will be a key component of any national energy and economic program.

Without federal help, we have taken a series of important steps, including the rate of stabilization plan announced last year and the active development of major new Canadian and US markets to insure that Hydro will bring substantial new benefits not only to Manitoba but also, as a direct result, to all Canadians. Our Progressive Conservative government, Mr. Speaker, has been and will continue to be committed to the provisions of essential services for all Manitobans.

In the area of health care, I welcome the addition of a 15-bed personal care home and renovations to the MacGregor Hospital, which will reduce the number of acute care beds to eight from the existing twelve. The 16.4 million allotted to personal care homes in Manitoba, Mr. Speaker, represents this government's concern for the people of Manitoba. I would hope that the proprietor over operated personal care homes, including Portage's Holiday Retreat, will see fit to expand their operations.

The government has though, through the shelter allowance for the elderly renters program, provided direct assistance to senior citizens with low and moderate incomes who pay rent. We realize the effects of inflation on people on fixed incomes in this province. In the field of education, Mr. Speaker, the Minister of Education and his department have been aware for some time that the financing of education required a revision and updating.

While the property tax credits have provided welcome relief for homeowners and renters from increased reality taxes for educational purposes, it is still necessary to provide sufficient funds directly to the best possible education opportunities for the pupils under their jurisdiction. Accordingly, the government announcement by the end of this fiscal year it plans to bring forward proposals to implement 3789

Thursday, 15 May, 1980. improvements in the school grant system should be universally welcome. Mr. Speaker, of immediate benefit to school boards and taxpayers alike is the announcement that the cash flow of grants earned by the divisions during their financial year will be speeded up, thereby reducing the interest costs to the school divisions in the province, with the ultimate effect, of course, of reducing their expenditures. I agree also, Mr.

Speaker, that consultations should be undertaken with the municipalities to determine whether or not it is possible to speed up the payment of special levies to school divisions. Mr. Speaker, a statement which I do not mind repeating but which has been made many times previously in this house is that the agriculture industry remains the backbone of Manitoba's economy. In this province we are blessed with fine resources which, when combined with the energetic and knowlegeable efforts on the part of primary producers, allows us to be a major producer of human food raw materials. I am pleased, Mr.

Speaker, that this government can take pride in saying that it supports, without a doubt, the efforts and initiatives of individuals in that industry. Mr. Speaker, the agricultural industry can only be strengthened developing the food processing in this province. Let Manitoba process the raw material she creates. Our government has seen fit to assist in providing 2.4 million for the expansion of the food product centre in Portage la Prairie, to increase research in the food processing industry. This government is also committed to continued improvement in grain transportation and has supported this.

Since the Grain Handling Transportation Conference that was initiated by Premier Lyon in January of last year, a number of important steps have been taken to improve the capacity of grain handling and transportation system to perform adequately to meet market opportunities. The decision made by our agriculture Minister to lease 400 hopper cars on a temporary basis was an important step towards eliminating the bottleneck in our transportation system.

The work by the former federal government towards the upgrading of our exporting facitilities, but particularly that of the former Transport Minister, Honourable Don Mazankowski, appeared extremely favourable. The commitment made by the Clark government of 42.5 million to expand the Prince Rupert 10-bushel terminal elevator was a definite step towards the targeted increases in grain exports needed by 1985.

Unfortunately there has been some indication that the Liberal government may not carry through with the intent of the memorandum of agreement signed by the former Transportation Minister Don Mazankowski to pay for the grain terminal infrastructure at Prince Rupert. The recent western Premiers' meeting in Lethbridge highlighted the importance of proceeding with the development of Prince Rupert and urged the federal government to honour the commitment made by the previous administration.

The Prince Rupert development is in the national interest and would increase Canada's capacity to export coal, potash, grain and other agricultural products. The federal Liberal government must proceed quickly with this matter if it is really serious about the transportation needs of western Canada. We as a province must hope and strive for the continued improvements in the complex grain transportation crisis. Mr.

Speaker, the provincial involvement in agriculture development through AgraMan and rural water development programs is a further example of our role in aiding Manitoba to achieve higher levels of production and diversification. We must not for political gain create productivity where it cannot economically exist. Self-efficiency may be a desirable economic state, but in the agriculture industry it is far too costly in terms of misguided financial input and production inefficiencies. The role of government should, Mr.

Speaker, and hopefully will continue to be, under this government, supportive of agricultural improvements through financial assistance and market and technological development. Mr. Speaker, we are entering another decade with many questions remaining from the Seventies and prospects of many more questions arising in the Eighties. Problems undoubtedly will be new and challenging in the Eighties, and we must be prepared to meet them. The first preparations for these problems lie in dealing with today's problems in responsible and logical fashion. One question facing our province, Mr.

Speaker, is the destination of our Port of Churchill. I strongly support our northerly port and extra moneys, that is moneys beyond necessary social services spent in Churchill should be towards improving its shipping capabilities. The huge federal expenditure in the Churchill complex could have well weighed hea vily towards the improved rail transport to the north. Our northern port, the only inland seaport in North America, is not only important to Manitoba, but to all of the prairie provinces. It is important economically, and in the event of another World War, Mr.

Speaker, the port would be extremely important to the defence of our North American continent. Mr. Speaker, it has been a pleasure for me to speak in support of the Budget of the Honourable Minister of Finance. I look forward to more budgets like this one, which is providing for economic stability of our province in 1980, and more opportunities for the people of Manitoba. Mr. Speaker, it is this type of budget brought in by the Honourable Minister of Finance that will brighten the prospects for all Manitobans. Thank you. MR. SPEAKER: Is the Honourable Member for lnkster wishing to speak. MR.

GREEN: I wanted to adjourn. If the member is going to speak, Mr. Speaker, I'll let him speak. MR. SPEAKER: The Honourable Minister of Municipal Affairs. HON. DOUG GOURLAY: Thank you very much, Mr. Speaker. I appreciate the opportunity to participate in the Budget Debate. I did not avail myself to participate in the Throne Speech Debate earlier in this session, however I would like to take this opportunity to congratulate you on your resumption of office. In my opinion you have done a very fine job and I am pleased that you are continuing on in this role. 3789A-1

Thursday, 15 May, 1980. I would also like to take this opportunity to congratulate the three new MLAs that entered the Chamber for the first time this session. By their participation already in this session, I would say that they are contributing greatly to the debate. I wish to offer my best wishes to the Leader of the Opposition, who was officially elected by his Party members last November, and at this time too, I'd also like to congratulate the Minister of Finance and his staff for putting together a very fine Budget which he ably presented to the House on Tuesday evening.

I noted with interest that the Leader of the Opposition attended a nominating meeting in my home constituency of Swan River just recently, where Leonard Harapiak won the nomination by acclaimation. According to the newspaper reports, Mr. Harapiak, who I might add is a very fine person and one who I have a lot of respect for, was promised a senior Cabinet position by the Leader of the Opposition after the next provincial general election. I think this is a pretty courageous sort of a promise, especially when . . .

Obviously, the Leader doesn't consider he has much Cabinet material around him at the present time to make such an early projection, or an early commitment. One thing is guaranteed, Mr. Speaker, I'm not sure who will be the PC candidate in the next provincial election at Swan River, but I hope that I have a good chance to participate in it.

I know that we'll put up a heck of a fight in the next provincial election in the Swan Valley Constituency and I hope that I am able to have some influence on what happens in the Cabinet decisions at that time. -(Interjection)- Yes, you're right, but l don't intend to lose; I'm going in there to win and I think that's the only attitude that I would want to have. I am certain that the people of the Swan Valley area are very proud to be represented by a junior Cabinet Minister.

I can tell you another fact, that I am very proud to represent that very fine area in the province of Manitoba, and certainly it is my intention to do just that for at least one more term. I would just like to comment, after the nominating meeting in Swan River just held recently, the Swan River daily paper quoted Mr. Harapiak as criticizing the PC Government of Sterling Lyon for letting public spending get out of hand. Now, I think that is kind of a ridiculous statement.

All we have heard in the last two or three years is the restraint program and the lack of spending that this government has been accused of He also goes on to say that . . . This is a farm area, and he said, The Manitoba government must press for an upgrading of grain shipping. This is certainly true and I think that one can only recognize the very fine efforts that have been done in the last couple of years by the Premier of this province, in co-operation with the Minister of Agriculture of this province, together with the Premiers of the other western provinces and, of course, their Ministers of Agriculture.

I think that it is only fair to commend the efforts that have taken place in the last couple of years and the amount of grain movements that have occurred. I know in my own constituency I talked to a few elevator agents last fall and they said that a great amount of grain had been shipped out of the Swan River point and, if it kept up at that rate, they would be out of grain well before the end of this current crop year. Over the past two years my colleagues have worked very hard to bring back to the people of Manitoba a government that adheres to the principles of fiscal responsibility and accountability.

I, as a member of this government, am very pleased with the success we have had in achieving this goal. I feel that the people of this province are much more confident with the way this government is spending the taxpayers' dollars. To comment briefly on Manitoba Hydro, and again this is the responsibility of our Minister of Finance, the investments that have been made by our government to review the operation and direction of Manitoba Hydro was money well spent. A review of Hydro disclosed that an estimated 500 million-plus of the Manitoba taxpayers' money was spent needlessly.

In Judge Tritschler's words, it ranged from reckless to irresponsible. MR. SPEAKER: Order please. The Honourable Member for Lac du Bonnet. MR. SAMUEL USKIW: I would like to know whether the member would like to table such a document which alleges there was a waste of some 500 million in Manitoba Hydro, a copy, or name the page within the Tritschler Report which indicates that, Mr. Speaker. MR. SPEAKER: The Honourable Member for Swan River. -(Interjection)- Order please. The Honourable Member for Lac du Bonnet. MR. USKIW: Mr.

Speaker, I thought the member was willing to provide us with a document that would back up the statement that he has just made . . . MR. SPEAKER: .Order please, order please. The honourable member was not reading from a document. The honourable member has a right to accept a question or to refuse a question. MR. USKIW: Mr. Speaker, I will ask the member the question again. Is he prepared to table a document which suggests that the previous government wasted in excess of 500 million on the Hydro development? MR. SPEAKER: The Honourable Minister of Municipal Affairs. MR.

GOURLAY: I would be prepared to table my notes, if that is sufficient. -(Interjection)- I could arrange to give you a copy of the Tritschler Report. -(Interjection)- Anyway, you would think that the Opposition would . . . MR. SPEAKER: Order please, order please. The honourable member will have an opportunity to enter debate. I would hope that he would extend the courtesy of debate to other members of the Chamber. The Honourable Minister of Municipal Affairs. MR. GOURLAY: You would think the Opposition would learn by their past mistakes that we should really take a look at our Hydro markets before we go 3789A-2

Thursday, 15 May, 1980. and develop costly projects first. In other words, in order to develop these major Hydro projects, we spend billions of dollars and then to turn around and sell that generated power for below cost is something we can't afford to do for very long. Certainly this is what has cost us many dollars in the past.

I think it is important to point out to the public the relationship between the money that is flowing out of our provincial economy to pay for interest on the borrowed capital used to finance our Hydro projects and the money that flow s out of our national economy to pay for the imports of foreign oil. This simply reiterates the importance of proper management and timing of the development of Manitoba's greatest Hydro resource.

Our government has placed a five-year freeze on Hydro rates to give the people some benefit to plan and utilize to their advantage an energy source which could have been provided for at least 20 percent less than the current cost, had it not been for past mistakes. It is the intention of our government to ensure that Manitoba consumers benefit from the future development of our energy resource. The five-year freeze on Hydro rates will continue to add to Manitoba's ability to attract new investment and add financial stability to the utility.

New economic initiatives centred around policies for energy and the sound, orderly development of Manitoba's extensive hydro-electric resources have been outlined. As part of the program measures to encourage stable growth in Manitoba, this government has proposed the creation of a Manitoba Energy authority to provide a central focus for the province's energy considerations. I feel this is a very positive move. As well, the restructuring of the Manitoba Energy Council has been proposed to encourage public participation in energy matters, conservation, and research and development to aid this energy authority.

My Department of Municipal Affairs is pleased to have been able to negotiate with .the federal government the Community Services Contribution Program, who in conjunction with the province provided communities throughout Manitoba with almost 17 million to be used in a wide range of projects determined on the basis of the local needs and priorities of these communities. I am also pleased to note that the Assessment and Review Committee is presently holding hearings to obtain the views, observations and comments on municipal assessment from the people throughout Manitoba.

Our Department of Municipal Affairs has also recently made a move to further decentralize our planning branch to better serve the rural needs. I might add that just recently new offices were opened in Steinbach, and there will be new offices opening up in Stonewall, Portage la Prairie and Morden in the very near future. These are already in addition to those opened some time ago at Brandon, Thompson and Selkirk. Mr.

Speaker, over the last three years I know that there has been much criticism by the members opposite on our handling of the north and our lack of attention to the needs and development of some of the northern communities. I would just like to say that we are very much concerned about the north, and we are concerned about the safety of the people in those areas. I'd just like to reiterate some of the programs that were started by the previous administration that we've had to take over and either repair them or upgrade them.

Most of the water systems in the northern communities were nonfunctional when we took over as government, and some of the problems that we ran into - I know in one situation in my own constituency at Pelican Rapids, the pump house was constructed below flood level or even the wind tide level, so that most of the time it couldn't function because the pump house was under water. In another community the intake of water supply was downstream from where the sewage was being dumped into the river.

The improper installations by the use of wrong pipe, or no drawings as to where lines were installed, made up most of the other problems. It was hard to determine the actual cost of these fiascos, as usually there were extensions of water lines undertaken at the time of the repairs to the nonfunctional water systems. I do not deny that we have made some mistakes too, and we'll probably continue to do so, but we are not afraid to admit any problems that we may have run into. They don't occur very often, and I would say that the staff that we have with Northern Affairs are very conscientious of their efforts.

They put their best effort forward and I believe that we have a very minimum of problem areas within the staff at the present time. I might add that when we took over as government there were 500 employees in the Northern Affairs portfolio. At the present time there are, I believe, 108 positions. However, we co-ordinate a lot of the activities, where the previous administration had their own service departments. I would like to briefly mention some of the other problems that have cost us considerable amounts of money in the north.

The Norway House Arena, which I briefly mentioned a few days ago in the House, and indicated that it was by accident that we found there was a serious problem with the arena, in that one of the Northern Affairs' staff happened to be in the arena one day late last summer; it was a windy day, and he noticed the end wall was swaying up to two feet. so he called in the labour inspectors to see what the problem was.

At that time, the building had been open since I believe 1975 or 1976, and all that was holding the end wall was the roof sheathing, and it was a miracle that this arena had not collapsed, whereby it could have injured many hundreds of people, which would have been a terrible disaster for the community. The inspectors came into Norway House and they ascertained that there had never been an occupancy permit acquired by the local community or by the officials of the Department of Northern Affairs, who were really responsible for the management of the construction of the Norway House Arena.

The inspectors prepared their list of those deficiencies in the arena - I would just like to relate to you some of those problems. Work that had to be undertaken on the building included the installation of heating and ventillating equipment; install all electrical; install existing lighting; install fire alarm system; reconstruct first floor public area to conform to approved design; install fire resistant drywall 3789A-3

Thursday, 15 May, 1980. where required; install fire exit doors where required; install exit stairs where required; reconstruct second floor support beams; place granular fill around building to provide access to the building; construct landing steps and ramps at exit doors as required; install fire doors; install fire rated glass between public viewing area and arena; install rough-in plumbing; install overhead door to arena; pour concrete floor and supports for bleachers; build and install bleachers; install arena board and related structures; install diagonal struts for roof and wall supports in arena area - these were omitted during the construction - reinstall sway braces far end arena wall, due to item 18 not installed, 19 broke away; place fill inside arena to level off for ice surface.

These were some of the things that had to be done in the Norway House Arena to bring it up to the building safety code, and this was estimated to cost somewhere in the neighbourhood of 300,000. The staff were aware that another arena had been built at about the same time and so they felt it was only reasonable that they should call in the inspectors to look at the Wabowden Arena.

I'll just give you a list of what they found out was wrong there: foundation problem - grade beam on east wall is heav ing; crawl space, drainage and ventilation; crawl space insulation; second floor support beam not properly constructed - as a matter of fact the beam almost missed the support post underneath - fire resistant drywall not installed where required on walls; fire resistant drywall omitted throughout the entire main floor area; some exit doors to be changed due to not being the proper type or else swing in wrong direction, in other words the crash doors opened inwa rd; handicapped bathrooms required ; work stairs to second floor require modification and completion; fire doors required; layout of rooms on second floor changed from original approved design may require change to bring back into line with building code; no ventilation in arena area; exit doors in arena area are approximately three feet above floor level, no steps exit to them, on the outside there was a five foot drop to the ground; seating which to date has not been installed will have to be redesigned due to the ice surface not being placed in the location as the original plans specified; no ramps or stairs or landings provided on the outside of the building at the emergency exit doors.

So there was another horror story costing another 300,000. Now in the case of the South Indian Lake homes, as was mentioned, this expense in relocating the homes was paid for by the arrangement with Manitoba Hydro but serious problems have been identified in the housing situation at South Indian Lake. I would like to just report on some of the conditions of those residences. Many of the homes in the community are experiencing severe problems due to foundation movements.

Examples of conditions common in the homes are as follows: Exterior steps are often badly out of alignment due to differental settlement between the step footings and the remainder of the foundations. The perimeter crawl space sheathing is buckling in some cases, due to the crawl space wall settling into the ground. Floors are sloping due to differential movement. Floor tiles are cracking near the centre of the house due to the reversal in the floor slope across the centre beam. Floor tiles are lifting from the floors near the exterior doors due to frost and moisture entering at poorly fitting doors.

Interior and exterior doors jam badly due to the shifting of the homes' foundations and, as a result, many of the doors have been removed by the residents. Wall panelling on interior partitions and exterior walls is buckling in some homes due to shifting of wall sections. Interior partitions are being lifted from the floors in some homes. This occurs when there is an extreme differential movement between the front or rear of the home on the line of support at the centre of the home. Floor decking in several of the homes is rotting and furniture is breaking through the floor in some cases.

In order to fix up the damages to the homes and replace them with concrete foundations, it is going to cost an estimated 540,000.00. So these are 35 homes out of the 93 homes that were inspected. This morning I had the opportunity to review the Moose Lake Loggers and Channel Area Loggers. People here in this Chamber know that those two companies have had a history of some difficulties. The Moose Lake Loggers for a number of years were running in the red. However, the last three years, they have had very successful operations and they have come out on the black during each of the last three years.

The story of the Channel Area Loggers is not quite as successful. They have had some other difficulties. The management there and the local people are working hard to get Channel Area Loggers in the black but. it's likely going to take at least another couple of years to do so. During the questioning today, it was asked of me whether we would be selling off these two companies because, look, now they were making money.

Members here will know that those projects were started in conjunction with the local people and it was hoped that these local people would be able to take over these companies and supply the management, and take over the ownership when it was felt that they would be in a fair position to do so. The Member for The Pas, I think it was, asked me if we were going to be selling them off like we did six other projects in Northern Manitoba.

I just happened to do some research on these six projects that were sold off and they certainly don't compare to the type of projects that were initiated at Moose Lake and Channel Area Loggers. I would just like to briefly go over those. The Minago Contractors Limited, a Thompson­ based road construction Crown corporation, was incorporated in 1972. They showed, at the end of October, 1978, a profit of 31 0,000, but that included provincial grants totalling 7 45,000.00. In 1976 and 1977 it had been included as revenue in arriving at the accumulated profit of 31 0,844 at March 31, 1977.

The absence of competitive bidding in the awarding of provincial road contracts to Minago rendered suspect the profits earned. Number two company that was liquidated was Mistik Creek Logging Company, a Cranberry Portage-based logging Crown corporation incorporated in 1976. The loss for the three months ending March 31 , 1977 was 45.00. Loss for the year ending March 31 , 1978, was 21 3,800, plus loss on sale of assets, 88,600.00. Total losses were 302,000 3789A-4

Thursday, 15 May, 1980. and, in addition, there were training subsidies of some 50,000 received from the province of Manitoba. The private operator now employs approximately the same number of people as the provincially-owned company did. The Churchill Prefab Plant, a Churchill-based house-building project started in 1972, which we have heard discussed in this House from time to time, the financial losses here: Total grants and subsidies received from the federal and provincial governments since inception totalled approximately 6.5 million.

Average loss per job for the two-year period ending March 31 , 1977 is 14,500.00. This exceeds welfare saving or wages paid to employees. Actual cost of producing the 19 modular houses for MHRC totalled approximately 95,000 per house, excluding land, compared to contract price of some 54,000.00. Losses incurred do not include a posssible hidden subsidy. The Athapap Builders house-building project, with the main plant in Cranberry Portage, saw a small plant in Young's Point started in 1977.

Financial losses the first year ending March 31 , 1978 were 95,000, adding training subsidies received of 102,000, the total loss was 197,000.00. The cost per training of approximately 7,000 per man year exceeds welfare savings. Then there was the Pukwagan Log Builders, the Wabowden-based community corporation funded by the province. The financial losses, cumulative losses to December 31 , 1977 were 41 3,489.00. Those are some more horror stories from the north. We have been accused of not really providing anything new to the north.

All I can say is it's been a very difficult time repairing some of the projects that were started. Obviously the people of the north really don't think we've done very much because the arena was at Wabowden; the arena was at Norway House; the water systems had been installed; the houses had been provided at South Indian Lake and these all add up to millions of dollars to bring . them into a functional situation.

I think it is worthy to note that we are concerned greatly with the northern situation and I would like to say that this past year the Communities Economic Development Fund has been stepped up and during the past fiscal year there wee 31 loans approved, creating or retaining some 144 jobs. These are meaningful jobs that are being supplied by entrepreneurs in various northern communities, providing services to the communities. Maximum use of the Special AR DA Grants to fishermen, trappers and forestry projects have been undertaken in the past year.

I might add that we have heard in other speeches today of the new development in mining and exploration that is taking place in northern Manitoba. Through the local government services it is the intentions of the Department of Northern Affairs to progressively transfer authority, funds, and resources to northern communities in a move towards increasing their autonomy and self-administration. Recently there had been an

article printed in, I believe, one of the daily Winnipeg newspapers mentioning about the guidelines that had been imposed on the many northern communities and that they were not happy with these guidelines. I would like to say that the majority of these communities are very pleased with the type of manuals that are supplied to them.

These manuals, the information or guidelines, have been in use for many years in the northern communities and it was only in the last year or two that they were printed so that there was some sort of co-ordination of the activities for the various community councillors to work from and the majority of the councils appreciate these manuals. No doubt there are some that feel they are a bit restrictive but they have been, for the most part, working out very well and we are moving towards increasing the number of self administration councils in northern Manitoba.

I have personally met with several community councils and plan on visiting many more during the months ahead. I am keenly interested in how we might work together to improve employment opportunities and social conditions throughout northern Manitoba.

In addition to technical assistance given to remote communities in the north such as the maintenance of physical facilities, including safe drinking water systems, roads and public buildings, the Department of Northern Affairs in conjunction with the Fire Commissioner's Office of the Department of Labour and Manpower and the Department of Natural Resources, we are co­ operating to bring improved fire protection and prevention to these remote centres.

I might add that out of the 50-some communities that come under the Northern Affairs jurisdictions, we have some 32 volunteer fire-fighting resources in some 32 communities. I haven't said much about the actual Budget Debate but I would just briefly sum up by saying that it's a very humane budget. It's geared to help needy families, senior citizens, and early pensioners with limited resources. I just would like to briefly refer to an

article that appeared in the May 15th issue of the Winnipeg Tribune, re Dauphin born, J. A. Armstrong, Chairman and Chief Executive Officer of Imperial Oil, said here last night he finds little justification for the pessimism I sense these days in Manitoba. Not that he predicted Imperial Oil or any other exploration and development company is about to bring in a Leduc.

The upbeat message he gave to the 108th Annual Dinner of the Winnipeg Chamber of Commerce at the Winnipeg Inn was based on Manitoba's almost ideal location to profit from the westward shift of population and economic power in Canada, and I think that this is the message that our Minister of Economic Development has been relaying to this House. I can only sense that Manitoba looks forward to great activity in being able to work together with our neighbouring provinces in the west, especially Alberta and Saskatchewan, who have had considerable industrial development in recent years. Mr.

Speaker, I would like to again thank you for the opportunity of being able to participate in this Budget Debate and I know that the budget will be appreciated by the many municipalities that make up the province of Manitoba, the taxpayers of Manitoba, and I know that the communities served under Northern Affairs will greatly benefit from the many programs that were announced by the Minister of Finance on Tuesday night. Thank you. 3789A-5

Thursday, 15 May, 1980. MR. SPEAKER: The Honourable Member for Brandon East. MR. LEONARD S. EVANS (Brandon East): Mr. Speaker, unless someone else wants to speak, I would move, seconded by the Honourable Member for Lac du Bonnet that debate be adjourned. MOTION presented and carried. MR. SPEAKER: The Honourable Government House Leader. MR. MERCIER: I move, seconded by the Honourable Minister without Portfolio that Mr. Speaker do now leave the Chair and the House resolve itself into a committee to consider of the Supply to be granted to Her Majesty.

MOTION presented and carried, and the House resolved itself into a Committee of Supply with the Honourable Member for Radisson in the Chair for the Department of Community Services and Corrections and the Honourable Member for Virden in the Chair for the Department of Agriculture. CONCURRENT COM MITTEES OF SUPPLY SUPPLY - AGRICULTURE MR. CHAIRMAN, Morris McGregor (Virden): I call the Committee to order. We are on Resolution 8, Administration-pass - the Member for St. George. MR. BILLIE URUSKI: Mr.

Chairman, yesterday when we left off Committee we were on the program of loans of the Manitoba Agricultural Credit Corporation, that the Minister indicated that somehow inadvertenly had been left out of the Annual Report of the Manitoba Agricultural Credit Corporation dated March 31 st, 1979. The Minister promised to bring me details with respect to the pamphlet that he indicated had been distributed quite some time ago through the Ag Rep offices and somehow none of us seemed to have seen any announcements to that effect. Does the Minister have that information for us now? MR. CHAIRMAN: The Honourable Minister.

HON. JAMES E. DOW NEY (A rthur): No, Mr. Chairman, I haven't got it yet. MR. URUSKI: Could the Minister tell us what the problem is in getting that information? MR. DOWNEY: No problem yet that I know of, Mr. Chairman, just that I haven't got it here at this particular time, but I said I would provide it, and I will. MR. URUSKI: When does the Minister expect to have the information? MR. DOWNEY: The minute I get it from the Credit Corporation, Mr. Chairman. Very shortly. MR. URUSKI: Are staff from the Credit Corporation going to be here tonight? MR. DOWNEY: No. MR. URUSKI: They are not going to be here tonight? MR.

DOWNEY: No, Mr. Chairman. MR. URUSKI: If we have some questions with respect to the workings of MACC, is the Minister prepared to provide all the information for us? MR. DOWNEY: As much as I am capable of, Mr. Chairman. MR. URUSKI: Mr.

Chairman, in my remarks I had asked the Minister, due to the fact that farmers were in a very difficult period at this time and many of them are facing bankruptcy, whether the Minister would consider amending the loan program, the program that only two people apparently had taken advantage of, the specific Comprehensive Guaranteed Loans Program; whether he would be prepared to amend that program to provide loans to farmers in order to be able to complete their spring work. MR. DOWNEY: Mr.

Chairman, I indicated that I felt that there had to be some review done of the interest rate that was being paid on those comprehensive loan guarantees. I also indicated that in some other provinces, where that same type of program had been put in place, that it actually took a two or three-year period for the program to become more used by the farmers of those different jurisidictions. I don't intend on making any major changes, but I do intend on reviewing it and making some minor changes.

Again it is a long-term loan program, and the situation we are dealing with in Manitoba as far as the emergency situation is, in most cases, more of a short-term nature, that this is a long-term guaranteed lending program that is put in place for the longer period. As I indicated, I don't plan on making major changes to it, but I believe it will fulfil! a need as the time, as I said, to be in place to service the farm community. MR. URUSKI: Mr. Chairman, could the Minister then tell us how many applications are pending with respect to this loan program?

The program has been in effect for just about two years, less two months, about 22 months, and we have had only two loans approved under that program, the program the Minister indicated was started the 31 st of July, I believe, or July of 1978. Could the Minister tell us how many applications were there, or are pending under this loan program now? Is there a lot of interest on this program? MR. DOWNEY: Eight to nine, Mr. Chairman. MR. URU KSI: Mr. Chairman, eight to nine applicants at the present time? At what stage are those applications, could the Minister tell us? MR. DOWNEY: Various stages, Mr.

Chairman. 3789A-6

Thursday, 15 May, 1980. MR. URUSKI: Mr. Chairman, these are in various stages. When were the first two loans approved, Mr. Chairman? MR. DOWNEY: The information that was put forward yesterday to me from the Credit Corporation was in the period after the book was printed. Now I would check that out, and if it was prior to that, then I have been misinformed by the Credit Corporation, but I don't believe so. I indicated yesterday that it was since the report; that is what I said yesterday, and I have no reason to change.

They haven't instructed me any different; that it has been since that period of time, so it would be since March of 1979 I would assume, if that is the year-end of the report that has been tabled. MR. CHAIRMAN: The Member for Lac du Bonnet. MR. USKIW: Mr. Chairman, with respect to these two loan applications, could the Minister indicate when these applications were brought forward or first received. MR. DOWNEY: Mr. Chairman, I don't have the information of what particular time the applications were made. No, I haven't got that information, but can provid� it. MR. USKIW: Mr.

Chairman, were the applications in prior to the end of August, 1978? MR. DOWNEY: I will have to check that out, Mr. Chairman, I don't have that information. They could have been. MR. USKIW: Could the Minister indicate what the amount of these loans was, in each case. MR. DOWNEY: The total of the two, I am informed, Mr. Chairman, is 230,000.00. MR. USKIW: That's the combined? MR. DOWNEY: Yes. MR. USKIW: Could the Minister indicate whether these were for new applicants or for existing clients of the Corporation? MR. DOWNEY: I answered that question yesterday, Mr. Chairman. MR. USKIW: Mr.

Chairman, the Minister may or may not have answered it, but could the Minister tell us whether this was to new clients or whether this was to existing clients, rather, new applicants or existing clients. MR. DOWNEY: Mr. Chairman, I guess the question yesterday was what was it for and I suggest either debt consolidation or for new applicants. I don't know for sure whether they were existing clients. The question is whether they were existing clients of MAAG that converted, or were they new clients.

I would answer, further to correction, I would assume they would be new clients, but I stand to be corrected and I'll check that out, Mr. Chairman. MR. USKIW: Mr. Chairman, would the Minister be prepared to give this committee all of the details with respect to those two transactions sometime during the course of this committee's work? MR. DOWNEY: Mr. Chairman, I don't know the reason for the question or why we would be expected to give all the details.

I would check with them but I would think that there are certain reasons why he would want that; but I think it's a matter of conducting business with people and disclosure of information that would not be in the best interest of those clients and I would certainly not be prepared to divulge information that might affect those people. But I have no reason to . . . MR. USKIW: Mr. Chairman, a program that has been in effect for near two years and that has had two loan applications approved leaves many questions to be asked.

That result tells us that there is reason to want to find more information about the program. It also leads us to the questions of whether or not there are particular interests involved with respect to that program, given the fact that only two people are involved, secondly, that the program doesn't appear to be terribly well advertised.

In any event, I think that the committee would want to know the nature of the program, the nature of the application, the results of the application, in order that we can determine the program's worth, to say the least, notwithstanding the fact that there could be many other questions emanating of those applications. I think that it is not unreasonable to ask for that information since, if the Minister doesn't wish to give it, then of course we could file an Order for Return.

But being it is only two contracts involved, it seems silly to go through that route when we have a committee before us in any event, and we are not asking for it today, as long as the Minister would agree that in the course of these deliberations that we will have that information, Mr. Chairman. MR. DOWNEY: Mr. Chairman, I don't know that I am particularly reading what the member is trying to get at. If he thinks that there is something happening that isn't normal in those particular applications, then I don't particularly think that I like his line of questioning.

On the other hand, I would be quite prepared, if it's not going to in any way cause any problems for those people, to give him what information is required. I do so without even knowing who the people are or on what grounds or anything else, but I'll review it and give consideration to it. I'm not going to give him a statement here tonight saying that I'm going to provide everything because I don't think that it's in the best interests of the program to do so, but I will review it and give consideration. MR. USKIW: Mr.

Chairman, there is no doubt in my mind that that is not an acceptable answer to this committee, at least not to our members of the committtee. To give consideration, when we are giving consideration to the expenditures of public funds is not a good answer, Mr. Chairman, and never has been in my experience. That information should 3789 A-7

Thursday, 15 May, 1980. be made public if it is asked for, because it is the public's business to know. Mr. Chairman, the Minister says maybe there could be some injurious effects to his client. I will say to the Minister that without that information, there might be injurious effects to the public of Manitoba and therefore, in the public interest, overall public interest, the Minister is obligated in providing that information to this committee. It is only two applications that have been approved. It is not a difficult task. It is readily available; a phone call would get it to the Minister, Mr. Chairman.

So, if the Minister has nothing to concern himself with, with respect to the operations of the program or with respect to his office and with respect to his department's operations, then there is no logic in him withholding that information, Mr. Chairman, because it can be obtained by an Order for Return. Now, it is whether we debate it in this committee or whether we debate it under an Order for Return. Mr. Chairman, if the committee was not meeting, logically the Minister would stand up in the House, if we pursued the question, and he would say file an Order for Return, and we would do so. Mr.

Chairman, there is no need for that since this Committee has some way to go yet before it completes its work, and there will be ample opportunity for the Minister to furnish that information in its fullest form, Mr. Chairman, to satisfy the needs of this committee. MR. CHAIRMAN: 3. Administration-pass - the Member for St. George. MR. URUSKI: Mr. Chairman, it appears that the Minister, for some unknown reason tonight, he has been quite co-operative so far but tonight it seems that he doesn't want to be that co-operative with respect to the program at hand, Mr. Chairman.

He indicates that program has been in effect, two people have only borrowed from the program, and yet he does not wish to provide information to the committee. I wonder why the Minister does not wish to provide information for people who have borrowed moneys from the public purse. I would say that the information, in general, should be open to everyone, should be open in the case that we are raising, as well with respect to the Orders-in-Council that the Minister passed.

Last year the Minister passed Orders-in-Council for lands that were sold through MA CC, the names of the purchasers were on those Orders-in-Council. This year all of a sudden we have a number of sales that MACC made by tender and yet we have no details of who the purchasers are, only that there were a number of bids. Is the Minister now going to tell us that he is not going to furnish any information to this committee with respect to any dealings with the Manitoba Agricultural Credit Corporation or what is his intentions with respect to providing information on the loan program and on the land purchases, Mr.

Chairman? MR. DOWNEY: Mr. Chairman, we went through the same form of debate last year on whether or not we would disclose names of those people and the details of people who were borrowing money. MR. URUSKI: They were there. They were there on those OCs last year. MR. DOWNEY: That is on the sales, Mr. Chairman. I am referring to the first question, the first part of his question, about how he feels that I should be disclosing the full details of the different loans. We went through that debate and I took the position that I didn't think it was in the best interests; I still take that same position.

These particular two programs we are talking about, Mr. Chairman, are the Comprehensive Loan Guarantees, which are guarantees of financial institutions. Actual cash that is put out by MACC doesn't flow. There isn't a flow of funds from the government, it is a guarantee. I have indicated I would consider providing as much information as I could without putting in jeopardy those people who are borrowing or getting the guarantee. I have no reason to withhold information as far as the program is concerned.

If it is a matter of making the program work better and understanding it better, I am prepared to provide information that is helpful in that regard. As far as the second question, about allowing the people who . . . The names, those are the way they were submitted to the government from the Board of Directors of the Manitoba Agricultural Credit Corporation. He knows full well that the names of those people who are buying those parcels of land are displayed in the Land Titles Office, that it is information that is available, and I am not trying to keep anything from the particular indvidual or the Committee. MR.

URUSKI: Mr. Chairman, there appears to be a bit of a double standard in government about the openness of government. It seems that we are getting back to the stage of pre-1969 days when government wa s· very reluctant to provide information. We recall that the government of that day did not want to disclose any of the transactions that were made under the Manitoba Development Corporation. The government of the day said that it would be injurious to the borrowers of money from the public treasury, through the Manitoba Development Fund as it was known at that time, and no information was released. Yet, Mr.

Chairman, when we began publishing quarterly reports on the financial position of the Manitoba Development Corporation, the lending agency continued to loan money, the borrower's names, the amount of money, the interest paid, whether it was a loan guarantee - and there were guarantees put forward by the Manitoba Development Corporation, there were many times that the Corporation put up guarantees. Versatile Corporation was one of those guarantees. There were direct loans made, Mr. Chairman. That information was made public in a quarterly report. - (Interjection)- The Member for Minnedosa says, It was your policy.

Now we are getting somewhere, Mr. Chairman. Is a policy of this government to go back to the days of secret Syd and Premier Weir that didn't wish to reveal any information with respect to the loans that were made, or what do we have here now? Do we have here a kind of slipping back to the pre-1969 days or what has the Minister got? 3789A-8

Thursday, 15 May, 1980. It seems that while one government department is prepared to publish the information, this Minister and his department is not prepared to give the information. Can the Minister tell us . . . Doesn't it seem kind of odd that where two departments of government, one publishes the information, whether it be a loan guarantee or whether it be a loan under MDC, in quarterly reports, and now this Minister refuses to do so, Mr. Chairman? What harm does he feel will occur if that information is made public, Mr. Chairman? MR. CHAIRMAN: 3.(a)-pass - the Member for Lac du Bonnet. MR. USKIW: Mr.

Chairman, the Minister's silence, of course, is extremely deafening. -(lnterject ion)­ Mr. Chairman, the Minister feels that he does not want to provide, for the benefit of the public, the names and the transactions of people involved with his loan program. I suppose it is questionable in the sense of pu blic responsibility. The Minister is nodding his head, but I don't think he is agreeing with me. I think an argument can be made that, because it is funded by the public, the public ought to have the information.

I think an argument can also be made that not much will be accomplished and therefore there may be some negative aspects to that, and I suppose either side may win the argument, but I don't think it will achieve anything. I think the distinction that has to be made is that where members of the Assembly are asking for specific and particular information, rather than the whole file, there I think the Minister is obligated to respond, because the members are not asking for specific and particular contracts without reason or without logic, Mr.

Chairman, and the Minister's refusal to respond to a specific request indicates that there is something there that he doesn't want the members of the opposition to know and therefore doesn't want the public to know. That is in essence what is the implication, Mr. Chairman. We are not asking for the whole file. We don't want to know the names and the transactions of all of his clients. We want to know the names and the transactions of two contracts, or two people rather, Mr. Chairman. That's all we want. We are not asking for the whole file.

Now if the Minister feels that he cannot do that in the public interest, I will tell him that it is in the public interest to do that. If the opposition feels that there is something there, they have a right to demand for that information. We can do it here in committee; we can do it by Order for Return. The Minister can refuse, but that is his problem when he refuses, Mr. Chairman.

The matter can be pursued in a number of ways before this House adjourns, and whether the Minister wants to debate in his committee, or whether he wants to debate it in the House in Orders for Return, or whether he wants to debate it in question period every day, that perhaps is his choice; and whether he wants to debate it on motions into supply each time where a Grievance Procedure can be applied, that is his choice, Mr. Chairman. But it seems only common sense and logical that the Minister would respond to a very sincere request for information with respect to two transactions.

There has to be something wrong with this program, since there are only two transactions, Mr. Chairman. Mr. Chairman, if there isn't anything wrong with this program, then maybe it was designed for only two transactions. I think that's a legitimate question, Mr. Chairman, if it was designed for two transactions, we would like to know who they were designed for. Oh, yes, these are the implications that the lack of answers bring to the public's attention, Mr. Chairman. These are the implications that arise from the Minister's refusal to - we have no choice, Mr. Chairman.

We now are in a position where if the Minister says he refuses that information, then we have to say that he must be hiding something from the people of Manitoba that would embarrass the government. That's really what he is telling us, Mr. Chairman. -(Interjection)- Well, we are saying it, and we will not get going. -(Interjection)- No, it's not that simple. We are demanding that information, Mr. Chairman. We will demand it in many forms if we don't get it, Mr. Chairman.

If the member wants to sit here half the summer using up the time of the Assembly and -(Interjection)- yes, yes, yes, I would invite a closure motion because the Minister refuses to answer information, Mr. Chairman. - (Interjection)- Yes, I would be prepared to debate that. MR. DOWNEY: Mr.

Chairman, I have stated before, I think that we've had two applicants that were accepted under a program, and I said that it was a program that was introduced for all the farmers in Manitoba; that there are two approved; there are eight to nine that are being processed at this particular time; that in other jurisdicitons, Alberta and Quebec, with the same kind of program, it took two or three years to get the program off and running, and that's the process that we're seeing taking place right here.

We are dealing with a third party who I don't feel - I would check with those individuals, and if they have no problems, Mr. Chairman, then fine. But I do not feel it's in the best interests of any financial institution, government included, when we are using - it's a Crown corporation; there's a third party involved; that if that information can be made public without putting anybody in jeopardy, then I would give consideration to it.

But I am not going to sit here tonight and accept accusations from the members opposite that it's been put in place for two specific people, or that something is wrong with it, that it's -(lnterjection)­ Well now, you know, we're sitting here tonight going through a debate that is taking up the time of this committe on . MR. USKIW: Legitimate time. MR. DOWNEY: . . . for reviewing the expenditures of the Manitoba Agricultural Credit Corporation.

It is a loan guarantee, accepted by that corporation, approved by the board of directors; there are other people involved; if at all possible, without in any way affecting people; I say affecting - if breaching any rights that those people have or stepping out of line on a legality of what the capacity of the corporation has to do, then I have no problem in providing information to do with these two particular contracts. But, Mr. Chairman, he's not trying to sit here and say 3789A-9

Thursday, 15 May, 1980. to me, in fact threaten me, that he's prepared to do X, Y, or Z. Mr. Chairman, he should know better than that. MR. USKIW: I do know best. MR. DOWNEY: He knows better because I will do everything I can to provide him with the information that he is requesting. MR. USKIW: Okay, all right. MR.

DOWNEY: I don't want to sit here until the wee hours of the morning to debate that issue, because I have indicated to him, if at all possible, without putting anybody in the third party in a position of legality, where it has legal implications to the province or the corporation or that individual, then we have to review that, but I don't think it is in the best interests of the - and let's remember, for those dogmatic minds across the way that cannot accept the fact that we are in the business of providing funds to help the farmers in Manitoba under a blanket policy that's there and available if they want to use it, fine, if they don't, fine, then you know there's something wrong.

But as I said, if I'm able to provide the information without breaching any contracts, without disclosing information that may be harmful to a third party, then I'm quite prepared to give it consideration. MR. USKIW: Mr. Chairman, can the Minister assure this committee that no member of his family is involved in these two applications? MR. DOW NEY: Yes, Mr. Chairman, I can assure him that no member of my family, that in no way, shape or form do I have anyone that is any connection to me, unless it's so far back - but to the best of my knowlege, Mr.

Chairman, I have no connection whatsoever, no conflict, family or otherwise. MR. USKIW: Can the Minister assure us that no member of the Assembly is one of those two applications or contracts? MR. DOWNE Y: Mr. Chairman, to the best of my knowledge at this point, I can assure him of that, but I would be quite prepared to check that out and give him that assurance. MR. USKIW: Can the Minister assure us that one of those contracts does not involve the chairman of the board of MACC? Can he give us that assurance? MR. DOWNE Y: Mr.

Chairman, as I indicated earlier in the committee, I don't know, but I would pretty sure that there is no member of the MACC board involved in any of those guarantees. But I will find out and provide that information to the committee. MR. USKIW: Is the Minister agreeing to provide the information to this committee of all transactions of existing board members with MACC ; all credit transactions for themselves personally as individuals. A MEMBER: Including the bank. MR. USKIW: Anywhere where we are involved.

I would like to know whether the Minister is advising this committee that any board member who has a loan, guaranteed or otherwise with MACC, that he is going to give us the information and the complete documentation on those transactions. MR. DOWNEY: Mr. Chairman, I would hope that there was no participation of a board of directors involved in any transaction that would in any way put that board of directors in conflict of interest, I trust, Mr. Chairman. MR. USKIW: That's not what I'm asking. MR. DOWNE Y: Well, he's suggesting any dealings. I would have to review that, Mr. Chairman.

I don't know the answer, sitting here tonight. I don't know specifically if there was a board of directors . . . MR. USKIW: I'm not asking the Minister if he knows. Mr. Chairman, my question is ... MR. CHA IR MAN: One member at a time. I'll recognize the Member for Lac du Bonnet when he signals so. MR. USKIW: Mr.

Chairman, I asked the Minister whether he is willing to give that information to this committee, that after he does his search of his own department and if he finds that there are board members who do have loans with the Manitoba Agricultural Credit Corporation, or guarantees, or whatever, that that file will be brought forward and given and the members of the committee will have a copy, to peruse the same. MR. DOWNE Y: Mr. Chairman, I will check that out and provide the information if it's available. MR.

USKIW: Mr. · Chairman, I hope the Minister now realizes the series of questions that arise when he refuses to give us information about two transactions, because once you have that refusal, you then trigger 100 new questions. I have only given two or three illustrations of the kinds of questions that are in our minds because of that refusal, so therefore it is not in the public interest for the Minister to keep that information away from this committee.

I accept his commitment that should he find that there is a board member that has a loan with MACC, that that file will be tabled before this committee, or a guarantee, it doesn't matter, that is still a contract with MACC. MR. CHAIRMAN: The Member for St. George. MR. URUSKI: Mr. Chairman, I hope the Minister . . . He didn't answer the last point. I am assuming that that undertaking is there. Am I correct, Mr. Chairman? Has the Minister given us that undertaking, just to be sure? Because, Mr.

Chairman, we have had arguments and we have had comments from members of the Conservative Party saying that it may be injurious to clients. Mr. Chairman, what I fail to understand is that the Minister of Fitness and Amateur Sport, who is in charge of the Manitoba Development Corporation, publishes information quarterly of all the business 3789A-10

Thursday, 15 May, 1980. dealings. And these are businessmen, these are small businessmen, no different from any farmer in Manitoba in terms of their loans, in terms of the guarantees that they receive from the Manitoba Development Corporation or the Community Economic Development Fund, yet somehow we are in a position to say, well, it's okay for those guys, but for these guys we're going to treat it differently. Both groups of people are entrepreneurs in the province of Manitoba.

Both groups have come to the public for either loan guarantees or loans, and on one hnnd the information is published and given out readily, even insofar as quarterly reports, and on this hand, in this area, we have, it appears, a bit of reluctance. As the Member for Lac du Bonnet has said, you know, when there is that reluctance, all kinds of questions can be conjured up and raised because of the inability of the Minister or unwillingness to provide that information. That's why I asked the Minister.

I mean, if the government felt that they were going to go into estimates tonight, the staff could have been here or brought in. There should have been no problem to bring the staff in from the Manitoba Agricultural Credit Corporation. - (Interjection)- Mr. Chairman, the historical precedence of budget debates, when the Leader of the Opposition makes his speech, usually no members - usually, traditionally and usually ... And I think the Member for Rock Lake should recall how it was on his side when they were in opposition.

I think they are liable to be and likely to be back there sooner than he thinks, and then he will see for himself that when his leader will be making the reply to the Budget Speech, whether any of his members will be following right on the heels of the leader, Mr. Chairman. MR. CHAIRMAN: I wonder if we could get back on Resolution 3, Administration. The Member for St. George. MR. URUSKI: I just want to make sure - the Minister didn't comment on the Member for Lac du Bonnet's question - is that undertaking there, Mr.

Chairman, to provide that information to this committee if loans or guarantees were made by any of the people in the questions that were raised, in the three or four questions that were raised by the member. Is that an undertaking? MR. DOWNEY: Yes, Mr. Chairman. MR. CHAIRMAN: 3.-pass - the Member for Lac du Bonnet. MR. USKIW: Mr. Chairman, I would like to pursue with the Minister the logic of not showing the names of the people who have purchased properties with respect to some twenty Orders-in-Council confirming the sale of certain properties held by the Manitoba Agricultural Credit Corporation.

These are all approved sales, but we in the opposition have no way of knowing just who purchased these properties. MR. DOWNEY: In answer to the member, Mr. Chairman , it is approval to sell. Those particular pieces of property are still in the process of being finalized. The top tender has been accepted; the agreement to sell is there and we would expect that everything is in normal transfer. However, I think the difference is they are approved sales, or approval to sell, and that's basically the difference, that they are approval to sell and they are in the process of being sold. MR. USKIW: Mr.

Chairman, the instruction here is that the Manitoba Agricultural Credit Corporation accept this tender and said property sold for 80,000, subject to approval of Lieutenant-Governor- in­ Council. Last year, these OCs carried the name of the individual. What is the logic or the reason for not doing that this year? That's a change of procedure but what is the reason for that? MR. DOWNEY: Mr. Chairman, the process is to make sure that the individuals, before transfer of the land, that the individual's financing is in place to purchase those properties. MR. USKIW: Mr.

Chairman, could the Minister indicate to this committee whether or not MACC is financing these purchases? MR. DOWNEY: Mr. Chairman, they could be in the process of financing some of them. MR. USKIW: Could the Minister explain just what kinds of properties these were or why they became surplus to the needs of the Corporation? - (Interjection)- Mr. Chairman, the Member for Emerson says this was stupid land and I don't know, my knowledge of

definitions is that I have never heard of land being stupid, Mr. Chairman. I've heard of land not being productive or terribly valuable, but I've never heard of land being stupid. I've heard of Members of the Assembly being stupid from time to time, and non-productive, yes, Mr. Chairman. The Member for Minnedosa is quite right, and at the moment, the contributions of the Member for Emerson are just that, non-productive and stupid, Mr. Chairman. -(Interjections)- Mr. Chairman, I would like to tell the Member for Emerson . . . MR. CHA IR MAN: remarks to the Chair. Order. Please address the MR. USKIW: Mr.

Chairman, I did address you. I said, through you, that I would like to tell the Member for Emerson that these stupid lands that were bought yielded the province a capital gain of 109 percent. Mr. Chairman, I don't know who is stupid here. I think it is the Member for Emerson, Mr. Chairman. I think so, Mr. Chairman. As a matter of fact, if the Member for Emerson would like to peruse these documents, you know, it is rather amusing. We have here a document dated in April, Mr. Chairman, just last month, where we have a purchase price of 59,000 and a sale price of 80,000, Mr.

Chairman, some 37 percent of capital gain accruing to the people of Manitoba, Mr. Chairman. Mr. Chairman, if you look at the next document - (Interjection)- Well, some people do better than others, Mr. Chairman. We have another document here, Mr. Chairman, which shows a purchase price of 45,000 and a sale 3789A-11

Thursday, 15 May, 1980. price of 65,000, a 45 percent capital gain. We have another document here that shows a purchase price of 22,200 and sold for 38,000, some 70 percent in capital gain, Mr. Chairman. We have another one here that has a purchase price of 12,000 that was sold for 17,700; that's roughly a 50 percent capital gain, Mr. Chairman. -(lnterjection)­ Notwithstanding what it is, it's a good capital gain, Mr. Chairman. Then we have another one here. The purchase price on this one was 11 ,000 and the selling price is 19,095, Mr. Chairman, with some 80 percent capital gain on that one. Mr.

Chairman, we have another one; they didn't do so well on this one. The purchase price was 25,000 and they sold it for 33,500; that's about a 33 percent in capital gain, Mr. Chairman. That's a low one. Then we have one here, Mr. Chairman, where the purchase price was 17,500 and the sale price was 46,810; that's about 160 percent capital gain, Mr. Chairman. Now we have one more, Mr. Chairman; they're very interesting ones, Mr. Chairman. The purchase price on this one was 25,000 and the selling price is 53,200.00. That's some 11 3 percent capital gain. We have another one, Mr.

Chairman, where the purchase price was 22,000 and the selling price is 72, 160, for a 280 percent capital gain, Mr. Chairman. Then we have another one here, Mr. Chairman, where the purchase price was 36,000 and the selling price was 85,000, some 235 percent capital gain. Mr. Chairman, we have another one here that was purchased for 16,000 and sold for 30,255, some 80 percent-odd in capital gain. Mr. Chairman, we have another interesting one here. The purchase price was 52,000; the selling price was 129,000, some 250 percent in capital gain on that one, Mr. Chairman. We have another one here, Mr. Chairman.

The purchase price was 18,800 and the selling price was 27,700, roughly a 50 percent capital gain. We have another one, Mr. Chairman. The purchase price was 18,000 on this one and the selling price was 23,500, some 30 percent in capital gain. That's the lowest capital gain of the lot, the only one at 30 percent. We have another one here, Mr. Chairman, at a purchase price of 23,500 and a selling price of 55,000, some 240 percent in capital gain there. This one here, Mr. Chairman, was bought for 81 ,000 and sold for 16 1,000; that's about a 99 percent capital gain. This one is most interesting here, Mr. Chairman.

This one was purchased for 37,500 and sold for 130, 170; that's a 350 percent capital gain. 350 percent, Mr. Chairman. Oh, that's a beauty, that one. Now we have one here, Mr. Chairman, with a purchase price of 47, 100 and a selling price of 11 1,200; that's 135 percent. We have another one here, Mr. Chairman, which has a purchase price of 13,500 and was sold for 36,565; that's a 270 percent capital gain. The last one, Mr. Chairman, was bought for 26,000 and sold at 55,500, and that's 11 5 percent in capital gain. All this stupid land, Mr.

Chairman, that the Member for Emerson refers to as being stupid land, yielded the province a substantial amount of money, some 662, 155 of profit. -(Interjection)- Well, the Member for Emerson, Mr. Chairman, would like to know if that's why it was bought. Quite frankly, no, that is not why it was bought, Mr. Chairman. For the benefit of members opposite, and indeed for the benefit of the Member for Emerson, it was hoped that in these kinds of opportunities benefits would have accrued to lessees, should they have exercised their option to purchase, in which case, you can readily see, Mr.

Chairman, how much assistance that would have been, or could be yet, for lessees, who would be opting to purchase, Mr. Chairman, at the old price and the amount of equity - well, it's unbelievable the amount of capital gain, never mihd equity - that they would have realized on these purchases. Mr. Chairman, that's why I asked the Minister to give us some detail on what happened with these transactions. I mean, why were they not purchased by the original lessees; why did they become surplus to the Crown?

There must be some reasoning and logic behind why the Minister had to find himself in a position to re-sell them. It seems to me if the Minister was very interested in introducing new young blood into the industry, Mr. Chairman, he could have foregone all of these capital gains and placed new lessees on these assets. Yes, he could have done that without any cost to the province, without any cost to the province, Mr. Chairman. That's right. But this Minister chooses not to do that, he chooses not to do that, Mr. Chairman. - (Interjection)- And yes, that is true, the Member for Emerson says, That is not our policy.

Therefore, the members opposite, the government has maintained a consistent philosophy, there is no question about that, and that is that they will do nothing in the marketplace to assist people into this industry even if it costs them no money, even if it can be self-sustained, because it is against their grain to tinker with the market economy in some form. That is really what it is all about, Mr. Chairman. I think what we have witnessed here is the missed opportunities for a good number of people, and demonstrates full well, Mr.

Chairman, the advantages of those original lessees of this program, should they have exercised an option to purchase, and the ones that did exercise the option to purchase have realized these gains. There is no question about that. I think it is worthwhile recalling that essentially the purpose of the program was to provide people with an opportunity to enter the industry, but who were financially strapped at the time and were not able to finance themselves into it. This was a means of doing it, Mr. Chairman. -(Interjection)- You know, Mr.

Chairman, the Member for Emerson keeps shouting from his seat, and I mean his seat because it is obviously not with too much brain power, that we could have financed these people into the business of agriculture. Mr. Chairman, the member knows that this element that we are dealing with is always in the position of not being able to achieve a financing capability, because of the fact that they have nothing to begin with.

If we are going to rely on the economics of the market to decide who is in and who is out, then ultimately only the person that has - I always use the expression - the fattest wallet ends up owning it all, and therefore there are no opportunities for others. You keep shrinking the opportunities for new entries into this industry, this is 3789A-12

Thursday, 15 May, 1980. what you do in the long term, and that has been demonstrated over and over again throughout the world, Mr. Chairman. This is not a new phenomenon. This is as old as the world is, Mr. Chairman. The people who have the wherewithal always have the ability to get more of it. That is right. That is the nature of the beast in terms of market economy, oh yes. The people that are already up there have the leverage to suppress those below from not getting up there. -( Interjection)- There is a good example, Mr.

Chairman, the Member for Minnedosa introduces an interesting name of a person who I gather has gone into receivership because of the weight of his operation, the size of his operation, Mr. Chairman. I want to remind the Member for Minnedosa that yes, he uses an example and it's a person who is, or was at least, if he isn't today, teaching our young aspiring farmers on how to get into the farming business. I don't know what that says for the facility that we have over at the Fort Garry Complex, Mr. Chairman, but whatever it says, it demonstrates part of the weakness of the system.

I would like to ask the Minister, Mr. Chairman, what he intends to do with all this new found wealth? What is the intent of this Ministe·r with respect to his realized capital gain? Would he not at least plough this bank into new opportunities for young and up­ and-coming farmers who want to get into the industry, or some of them who are having problems staying in, who have just gotten into the industry and are having some difficulty because of the atrocious money market today, whether or not he would be prepared to use the profits out of this program to assist at least that group of people, Mr.

Chairman, that, by the way, need some attention at the moment? MR. DOWNEY: Mr. Chairman, the Member for Lac du Bonnet has taken on quite an approach to capital gains that he feels so pleased with himself that he was probably the only one Minister of the Crown that is able to read into the record that any business they were in made some money, but let me say, Mr. Chairman, he is so proud of it, because really it was at the expense of the young farmers.

Really that is who he made the profit on, were the young farmers. -( Interjection)- He admits that, that it was at the expense of the young farmers, who he initia lly intended to help. Mr. Chairman, he asked me the question -( Interjection)- Mr. Chairman, those properties became surplus to the corporation because of people letting their leases lapse or they weren't desirous of carrying on, and what happened? What he has failed to do, he read in the cost to the corporation, but he didn't read in the carrying charges to the corporation.

He read in the cost, but it does cost money to carry these lands, so he has somewhat not totally told the full story. That is No. 1. I think the point he makes, what are we doing with those funds? Yes, Mr. Chairman, we are reinvesting them in land which farm people own. People will own those properties; they will take advantage of the increased value of land, or the decreased value of land and whatever. The way the industry goes, I think it is a matter of seeing that happen. Mr.

Chairman, I won't read through a lot, but I would just like to say that we do have one or two properties left for the farmers who feel that they may not be able to get into business. The Member for Emerson, I don't believe, meant what he said when he called stupid, maybe he would want to correct that himself. -( Interjection)- Maybe he should have aimed that in another direction or at an individual, because when we ...

Just one particular piece of property that wasn't sold, the carrying costs of that to date, of the corporation, are 83,000-and-some, in excess of 83,000, but the highest bid on that particular land was 42,000, which in fact was a great reversal of the argument that the Member for Lac du Bonnet is making. He sits here and says it is all one way. It really isn't; there are certain other situations. Really, Mr. Chairman, the point that I want to make is, is that the money will be made available for the farmers to own their land through mortgage financing, which has been very well received through the corporation.

MR. USKIW: Mr. Chairman, just to satisfy the Minister, I would like to tell him that I did do a calculation of the purchase price and the cost as he has illustrated in the Order-in-Council, and he still ends up, after all of that is taken into account, with a net capital gain of 447, 159.34, Mr. Chairman. After all things considered, he still has half a million dollars in his pocket, that is not a bad scene, Mr. Chairman. He has done very well on that one. That represents about 55 percent in capital gain. MR. DEPUTY CHA IR MAN, Jim Galbraith: The Honourable Minister. MR. DOWNEY: On a point of order, Mr.

Chairman, I don't think the member would want it left on the record that that was put in the hip pocket of the Minister but in fact is in the Manitoba Agricultural Credit Corporation to lend back to the farming community, and I hope he would want to correct that. MR. DEPUTY CHAIRMAN: The Member for Lac du Bonnet. MR. USKIW: Mr. Chairman, I think that kind of language is probably quite reasonable in light of the fact that the Minister just attempted to refuse to give us information. I have to admit that I wouldn't want to accuse him of putting a half a million dollars in his hip pocket, not of public funds.

He may do it of other funds ; the market system provides him that opportunity, and he might do that. I think anyone of us would do that, Mr. Chairman. Some of us have. That is nothing new, that is the nature of the beast, Mr. Chairman, but in any event he can't dispute the fact that there has been a fairly substantial capital gain out of the sales of those properties. MR. DEPUTY CHAIRMAN: 3 - the Member for St. George. MR. URUSKI: Thank you, Mr.

Chairman, it is interesting the philosophy that the Conservatives and this Minister is following in terms of what is now happening in rural Manitoba with farmers being squeezed the way they are in terms of the credit 3789A-13

Thursday, 15 May, 1980. crunch and the high interest rates and the inability of farmer s to be able to operate. Yet there is no program that the government has to allow farmers to receive assistance in terms of operating capital, but there is all kinds of funds available through the MACC to purchase land, Mr. Chairman. The Member for Minnedosa in his short comments mentioned that we may be just getting all of that back, Mr. Chairman, in time, and that may very well happen, Mr. Chairman.

The loans that the province is making when land of this nature is being purchased - not only this land, but other loans that they are making - there is always a possibility, especially at this time in our history in rural Manitoba , and the problems that farmers are faced with. We hope that times will be better, but it certainly doesn't auger well, unless as we have said before that there will be a good rain to set things off in motion. But yet there is no program for farmers to take advantage of in terms of operating capital. That whole area has been cut back. There are loans for . . .

If I recall the Minister's statistics that he presented to us the other day, all the funds -( Interjection)- Mr. Chairman, the Member for Portage, if he wishes to get into the debate, he can. I mean he took

part in the Budget Debate this evening and one could also accuse all the speeches of being repetition, but we did not do so, Mr. Chairman, we did not do so. Mr. Chairman, there is only less than 1 percent of moneys that are available for livestock and equipment, but nothing in terms, that I can see, of the loan capital for operating expenses. 16 percent of the moneys that have been used were for debt consolidation.

I presume that some of that money possibly could have been for operating expenses, but any new money to be injected into the rural economy certainly is not coming from this corporation, the majority of which, other than for the purchase of land, so it is likely that should the trend continue as it is being continued in the this last year, year-and-a­ half, with the squeeze on the farmers, that the government will be faced with, unless things change, repossessions, with closures.

All we have to do now is look at the pages and pages in the farm papers of auction sales, where farmers are pulling up their stakes, and there will be more, Mr. Chairman, as the crunch comes in. I have had calls today from a farmer who indicates that the fuel companies are now starting to put the squeeze on. Where the farmer is extended likely close to what is considered his limit, the pressure now is coming from even the fuel dealers on some farmers, because they have gotten extended and they are having a very difficult time.

So the impact is there, not only on the farming community, but really on rural Manitoba as a whole, because once the farmer is - and the Minister well knows - once the farmer is short of cash everybody is short of cash, and then some. There i� an escalator effect. -( Interjection)- Mr. Chairman, there are some options open to the government. There are some options that were carried out on the prairies a number of years ago. The Minister has options, and as the Member for Minnedosa says, the money market looks better.

The Minister may want to consider a moratorium on loans for a period of, say, six months, until the interest rates become better, if the prognosis of the Mem ber for Minnedosa is accurate. That is something that the government can certainly consider for the farmers. There is ample precedence of this in western Canada. Saskatchewan did it, not only during the depression but, I believe, in the Sixties they brought in a farm debt loan - I forget the exact words of the legislation, but that was done in Saskatchewan, Mr. Chairman.

So there is ample precedence, and it's something that I believe the Minister should consider in light of, or in the absence of any program through MACC. MR. DEPUT Y CHA IRMAN: The Honourable Member for Minnedosa. MR. DAVID BLAKE: Mr. Chairman, just on a point of order, for clarification, would the Member for St. George, when he is indicating, would he indicate that that should be legislated, or would he indicate voluntary moratoriu m on debt by the financial institutions that are presently carrying the debt load? MR. URUSKI: Mr.

Chairman, seeing as the Minister does not wish to interfere at all by at least calling in the corporate sector in this province; he does not want to interfere in the hog industry by calling in Cargill; he says that the banks should tow the line, Mr. Chairman. The Minister can choose as he wishes. I mean, that is really up to himself as to which direction he wishes to take, but that is an option that is open to him, Mr. Chairman. I will not stand here and say that I will present the legislation to him. - (Inter jections)- Of course not, Mr. Chairman. Ab solutely -( Interjections)- I have offered suggestions, Mr.

Chairman. The Minister of Highways can blow his stack wherever he wishes, but if he is prepared to act on it, like he has on seat belts, he may as well go home and go back to his farm, Mr. Chairman. Mr. Chairman, I hope that the Minister considers well -( Interjection)- MR. DEPUTY CHAIRMAN: Order please. MR. USKIW: The Members can put whatever they like around their necks, Mr. Chairman. They have done quite well in the last three years of being in office. Not only have they done it around their necks, they certainly are doing it to the farmers in this province, Mr. Chairman. There is no doubt about it. Mr.

Chairman, I want to bring to the attention of the Minister of Agriculture, while he is going out and selling land and making a good capital gain from it in terms of the MACC land, his colleague, the Minister of Mines and the Finance Minister, are giving away land at no cost. While on one hand the Department of Ag riculture is tendering land and making a good return, the Department of Mines and Resources is prepared to allow land to be conveyed to whom? None other than the Canadian Pacific Railway, Mr.

Chairman, at exactly what the poor souls, the Department of Mines and the Canadian Pacific Railway, who is supposed to be providing service to farmers, has not and is on strike, and yet this government is prepared to say, Well, look, we will give you the land at no cost. If ever there was a way, Mr. Chairman, of the government putting some pressure on the railways, this would be one way, Mr. 3789A-14

Thursday, 15 May, 1980. Chairman. They should have said, Look, you want this land, you provide the service to the farmers that you have not been providing for 15 years, Mr. Chairman. There is another avenue that the government could have used to attempt to get better service out of the railway. But leave that for now, Mr. Chairman. Leave that be as it may, Mr. Chairman. I am assuming that the Minister will provide us the information on these lands that have been sold by tender, Mr. Chairman.

I would like to ask the Minister specifically on the sales that have been made, are these sales in addition to the 293 parcels that the Minister gave us details of that were conversions and sold and financed through other institutions that he gave us the other day? Are these in addition to those 293 sales? MR. DOWNEY: Yes, Mr. Chairman. MR. URUSKI: Are there other sales in the process of being completed at this time, Mr. Chairman? MR. DOWNEY: Mr. Chairman, I believe there is just one at this particular time. MR. URUSKI: Has the O.C. been