ISSN 0542-5492 Second Se88ion - Thirty-Second Legislature of the Leglslatlve Assembly of Manitoba DEBATES and PROCEEDINGS 31-32 Elizabeth II Publl•hed under the authority of The Honourable D. JamN Walding Spealrer VOL. XXXI No. 30A - 2:00 p.m., MONDAY, 21 MARCH, 1983.

MANITOBA LEGISLATIVE ASSEMBLY Thirty-Second Legislature Members, Constituencies and Political Affiliation Name ADAM, Hon. A.R. (Pete) ANSTETT, Andy ASHTON, Steve BANMAN, Robert (Bob) BLAKE, David R. (Dave) BROWN, Arnold BUCKLASCHUK, John M. CARROLL, Q.C., Henry N. CORRIN, Brian COWAN, Hon. Jay DESJARDINS, Hon. Laurent DODICK, Doreen DOERN, Russell DOLIN, Mary Beth DOWNEY, James E. DRIEDGER, Albert ENNS, Harry EVANS, Hon. Leonard S. EYLER, Phil FILMON, Gary FOX, Peter GOURLAY, D.M. (Doug) GRAHAM, Harry HAMMOND, Gerrie HARAPIAK, Harry M. HARPER, Elijah HEMPHILL, Hon. Maureen HYDE, Lloyd JOHNSTON, J.

Frank KOSTYRA,Hon. Eugene KOVNATS, Abe LECUYER, Gerard LYON, Q.C., Hon. Sterling MACKLING, Q.C., Hon. Al MALINOWSKI, Donald M. MANNESS, Clayton McKENZIE, J. Wally MERCIER, Q.C., G.W.J. (Gerry) NORDMAN, Rurik (Ric) OLESON, Charlotte ORCHARD, Donald PAWLEY, Q.C., Hon. Howard R. PARASIUK, Hon. Wilson PENNER, Q.C., Hon. Roland PHILLIPS, Myrna A. PLOHMAN, John RANSOM, A. Brian SANTOS, Conrad SCHROEDER, Hon. Vic SCOTT, Don SHERMAN, L.R. (Bud) SMITH, Hon. Muriel STEEN, Warren STORIE, Jerry T. URUSKI, Hon. Bill USKIW, Hon. Samuel WALDING, Hon. D. James Constituency Ste.

Rose Springfield Thompson La Verendrye Minnedosa Rhinel and Gimli Brandon West Ellice Churchill St. Bo niface Riel Elmwood Kildonan Arthur Emerson Lakeside Brandon East River East Tuxedo Concordia Swan River Virden Kirkf ield Park The Pas Rupertsland Logan Portage la Prairie Sturgeon Creek Seven Oaks Ni akwa Radisson Charl eswood St. James St. Johns Morris Roblin-Russell St. Norbert Assiniboia Gladstone Pembina Selkirk Transcona Fort Rouge Wolseley Dauphin Turtle Mountain Burrows Rossmere lnkster Fort Garry Osborne River Heights Flin Flon Interlake Lac du Bonnet St.

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LEGISLATIVE ASSEMBLY OF MANI TOBA Monday, 21 March, 1983. Time - 2:00 p.m. OPENING PRA YER by Mr. Speaker. MR. SPEAKER, Hon. J. Walding: Presenting Pe titions . . . Read ing and Receiving Petitions . . . Presenting Reports by Standing and Special Committees . MINISTERIAL STATEMENTS AND TABLING OF REPORTS MR. SPEAKER: The Honourable Minister of Energy and Mines. HON. W. PARASIUK: Mr. Speaker , I beg leave to table the Annual Report of the Manitoba Forestry Resou rces Limited for the year ended September 30, 1982. MR. SPEAKER: The Honourable Minister of Economic Deve lopment. HON. M. SMITH: Mr.

Spe aker, I beg leave to table the 198 1- 82 Annual Report of the Department of Economic Deve lopment and Tourism. MR. SPEAKER: Notices of Motion . . . Introduction of Bills ... INTRODUCTION OF GUESTS MR. SPEAKER: Before we reach Oral Question Period may I direct the attention of honourable members to the gallery where there are 57 students of Grade 9 standing from the Charle swood Junior High School under the direction of Mr. Lerner and Mr. Small. The school is in the constituency of the Honourable Leader of the Opposition.

There are 15 visitors from the Practical Politics Group from Swan River under the direction of Mr. Hodgson. The group is in the constituency of the Honourable Member for Swan River. On behalf of all of the members, I welcome you here this afternoon. ORAL QUESTIONS Report by Governor Bouey re high deficits MR. SPEAK ER: The Honour able Lead er of the Opposition. HON. S. LYON: Mr. Speaker , I have a question for the First Minister.

Since the House last met, we unde rstand that the Governor of the Bank of Canada has made his Annual Report to the Government of Canada, wherein - I'm using words that others have used - he has warned in his Annual Report that during the 19 70's big budget deficits to stimulate the economy led to vicious cycles of higher inflation followed by greater unem ployment and would do the same in 1983 if that 893 policy of excessive deficits were to be followed by the Federal and, one presumes, Provincial Governments. Can the First Minister advise the House and the people of Manitoba, Mr.

Speaker , how the recent unfortunate Budget that was brought down by his Minister of Finance calling for an increase in expenditure of 17 .2 percent, one of the high est increases in Canada, fits into the advice that is being offered to the Government of Canada by the Governor of the Bank of Canada? MR. SPEAKER: The Honourable First Minister. HON. H. PAWLEY: The Leader of the Opposition may agree with Governor Bouey; I, as Premie r, do not. HON. S. LYON: Mr.

Speaker , can the First Minister give us some indication from something other than perhaps a Marxist symposi um, which apparently a number of his Ministers attended or supported, from any kind of substantial economic thought which would indicate that Governor Bouey is wrong in the warning that he is giving to the Government of Canada? HON. H. PAWLEY: Mr.

Spea ker, I think there is plenty of example to indicate that the kind of policies that are being urged by Governor Bouey upon Canada and, inde ed , on each and every one of the Provincial Governments in Canada, have assisted in driving us to the position that we are in today: first, by way of recession and rising levels of unemplo yment; and seco nd, if we want to talk about deficits it is those policies driving us to recession that have resulted in the largest per capita deficit in Alberta, a deficit in excess of $1 billion in British Columbia, a deficit that is the largest in some 40 years in the Province of Saskatchewan, deficits that are beyond anything that had ever before been anticipated in provinces such as Ontario and Quebec; it is the policies exemplified by Gov ernor Bouey that' s driving this count ry, unfortunately, to the posi tion it is today.

HON. S. LYON: Mr. Spe aker, given the unde rstanding by rational thinkers in this field - and I realize that there aren 't too many on the left where my honourable friend, the First Minister, finds himself - given the understanding that Alberta, Saskatchewan and British Columbia are three of the richest provinces in Canada and can afford, temporarily, to have large deficits,

whereas, Mr. Speaker, Manitoba now is one of the most debt-ridden provinces in the country thanks to the mismanagement of the last fou rteen months, is the First Minister trying to indicate and trying to justify to the people of Manitoba that a budget deficit of $579 million, going up to $700 million this year, is the right tonic for the economy of Manitoba at this time? HON. H. PAWLEY: In view of the experience that Canadians have been inflicted with for the past number of years under Bouey-like monetary policy, Mr. Speaker, it is not difficult to justify a change in direction that ought to be taking place.

Monday, 21 March, 1983 HON. S. LYON: Mr. Spe aker, can the First Minister indicate whether the rather aberrational, although unde rstandably, funny view of finance that he holds, particularl y on the fiscal side because socialists traditionally don't know much about the monetary side, can he indicate to the House and to the people of Manitoba if any other Premie r, or indeed even the Prime Minister of Canada, shares the rather uninstructed view that he has just given to the House? HON. H. PAWLEY: All that I can speak for, Mr. Spe aker, is the approach of the Manitoba Government.

The approach of the Manitoba Government is that indeed there must be a co-operative federal-provincial initiative from one end of this country to the other in order to attack un emplo yment. Mr. Speaker, do any other premiers concur? Mr. Speaker , I sense that a number of other premiers that are Conservative by way of stripe do not share the same ideological right-wing thinking as my honourable friend across the way.

Certainly, that is not the impression I received, for example, from Premier Peckford; it's not the impression I received from Premier Davis; it certainly is not the impression I received from Premier Lougheed, who indeed has been very vociferous in his criticism of high interest rate policy and is concerned that Canada follow a more independent policy in regard to interest rates. HON. S. LYON: Mr.

Sp eaker , given the fact that fortunately a high interest rate policy is not part of the problem that is affecting Canada today because even though the First Minister would like to deal in the past, interest rates in this country have been declining following tracking the American interest rate reduction for some considerable number of months. The problem now is not interest rates, even inflation has been going down. What Mr. Bouey is saying, Mr.

Spea ker, and this is what I would like the First Minister to comment upon, if he can logically and reasonably, that excessive deficit spending now is liable to cause a reintroduction and a reinflation in the economy which can inflict even more harm on the unem ployed, more harm on those on fixed income. Does the First Minister not realize, or does he not feel that there is sortie merit in that point of view? HON. H. PAWLEY: Canada's manufacturing capacity is in the neighborhood of some 60 percent of total capacity in Canada today.

There is in the neighborhood of some two million Canadians that are unemplo yed including 54,000 Manitobans. Mr. Spe aker, that is what the political leader ship of this country should be concerning thems elves about. Governor Bouey is not the elected representative. If he was the elected representative, Mr. Speaker , I don't think the Canadian public would tolerate the kind of views that he's been espousing for one moment. Constitutional Conference on Aborginal Matters HON. S. LYON: Well, Mr.

Speaker , given the statement of the First Minister a few moments ago that he was looking forward to working co-operatively with the other Premiers of Canada and with the First Minister, and 894 with anybody else to whom he can practise his attentive art of listening, would the First Minister indicate, Mr.

Speaker , how that particular policy of co-operativeness is going to be enhanced, or how the interests of the people of Manitoba are going to be improved, by the First Minister giving standard broadcast news interviews in which he criticizes the other nine Premiers of Canada for not, as he said, "doing their homework on the constitutional matter.' ' Could the First Minister cease slapping his own back long enough to tell the people of Manitoba how he thinks that is going to enhance his barga ining position with the Prime Minister or the other nine Premiers who he is criticizing? HON. H. PAWLEY: Mr.

Spe aker, I don't know whether we're moving from Governor Bouey to the Native Constitutional Conference . If that is the intent of the Leader of the Opposition, I'm prepared to certainly accommodate him. I want to mention, by way of response, that it's not just - what did the Honourable Leader of the Opposition refer to us a few moments ago as? - those that engage in their thinking from Marxist symposiums that come through with what the Leader of the Opposition referred to as "fu nny-money" ideas .

In Toronto last Monday, on my opportunity to travel through to Ottawa, I noted in the Toronto Star, its lead editorial said, "Ontario ought to follow the Manitoba lead ." It pointed out, Mr. Speaker, that if Ontario should commit itself, proportionate to its population, to a Jobs Fund as Manitoba has, that there would be some $1.6 billion to a Jobs Fund . Mr. Spe aker, if each Provincial Government would do that throughout this country, and if those funds were matched by federal dollars, Mr.

Speaker , there would be a $10 billion Jobs Fund to attack unemplo yment during times of peace, just as we'd be able to mobilize men and women in this country in order to wage war. HON. S. LYON: Mr. Speak er, I'm sure that the people of Manitoba will rest quietly knowing that the Premier of Manitoba places great faith in the Toronto Star, which was the paper which suppor ted Ed Broadbent for Prime Minister, and I, amongst others, was heard to say at the time, Sir, that the owners of Toronto Star supporting Ed Broadbent was something like a turkey asking for an early Christmas. Mr.

Spea ker, given the track record of the Toronto Star and putting that to one side, can the First Minister tell us what was his motivation for the kinds of reports that are being widely carried, to the effect that he was criticizing the other nine Premie rs of Canada for allegedly not doing their homework - as he so kindly put it - with respect to the Ind ian consti tutional questions;

whereas, of course, Manitoba, which is out of step with everybody most of the time, was by implication 10 0 percent right . HON. H. PAWLEY: Mr. Speaker , we are then moving to the other subject matter. I certainly did not criticize nine other Premiers; I criticized the fact that some Premiers had not involved themselves in the kind of dialogue that we had in the Province of Manitoba, that in the Province of Manitoba for the past year we've

Monday, 21 March, 1983 conducted a very active dialogue with Metis and with Indian groups in the province, that we included Indian and Metis groups within our provincial delegation. Indeed, I believe that the only exception to that was the Province of Quebec. Quebec also had Native representation. Mr. Speaker, it is my view that some provinces just had no dialogue at all; some had as much dialogue as we had in Manitoba. If we are to ensure that next year's Constitutional Conference is a success, yes, it is my view, Mr.

Speaker , that other provinces might want to look to the kind of model, the kind of example, that was establi shed by Manitoba. HON. S. LYON: Mr.

Speaker, given the fact that no one in this House has criticized the First Minister or his colleagues for including, as part of their delegation, some of the aboriginal people and so on; and given the fact that Manitoba, even before this government came along, did have negotiations with the aboriginal people about constitutional matters, which is not a new thing, does the First Minister really think it is helpful in his much touted co-operative stance with the other Premiers to go about patting himself on the back, or appearing to pat himself on the back, when really he is very much, if I may say so, Sir, a new boy in the club and he would be better to learn a little before he gives advice.

SOME HONOURABLE MEMBERS: Oh, oh! HON. H. PAWLEY: Mr. Spe aker, there are times when the senior boys in the club can provide useful advice; from occasion to occasion new boys sometimes have some useful advice to provide as well. HON. S. LYON: Mr. Speaker, would the First Minister mind telling the House which of the other nine Premiers did not do their homework on the Indian constitutional matters? HON. H. PAWLEY: Mr.

Spe aker, I think if the Leader of the Opposition would peruse the reports and the transcripts of this past week, he would sense very, very qu ickl y, unfortu nately, which Premiers migh t have provided greater initiative during the Conference to ensure that there be greater success. Marxist Study Conference MR. SPEAKER: The Honourable Member for Sturgeon Creek. MR. F. JOHNSTON: Mr. Speaker, my question is to the Minister of Economic Development and Tourism.

I'd like to ask the Minister, did she, the Minister, chair a panel at the Marxism Conference held at the University of Manitoba between the 12 th and 15 th of this month, March. MR. SPEAKER: The Honourable Minister of Economic Dev elopment. HON. M. SMITH: Mr. Speaker, I was honoured to be asked to chair one ses sion. 895 MR. F. JOHNSTON: Mr. Speaker, can the Minister inform the House what she learned that would employ 54,000 unem ployment Manitobans and stop the record bankru ptcies in this province? HON. M.

SMITH: Since the topic of the session was the International Trading and Mone tary Systems, I learned that some of the dislocation we're having in world trade can be accounted for by our inability, at the international level, to provide sufficient liquidity for developing countries and loans on terms that they can realistically repay, and without that kind of improvement in the international monetary fund and the world banking system, our chances for building a fairer and more stable international trading system are fairly low. MR. SPEAKER: The Honourable Member for Sturgeon Creek. MR. F. JOHNSTON: Mr.

Speaker , my question is to the Premi er. The Attorney-General, the Minister of Energy and the Minister of Economic Development were all listed as part of the agenda for the Marxism Conference held at the University of Manitoba and sup ported financially by the Provincial Government. I wonder if the Premier could let us have information in this House or would he supply us a list of all of the Ministers in his government and members of his caucus who participated in this conference. MR. SPEAKER: The Honourable First Minister. HON. H. PAWLEY: Mr.

Speak er, I don't think for a moment that I intend to delve into whether caucus mem bers or Ministers or others partici pated in a particular academic seminar or not, a seminar involving academic study. I'm not going to check from the Member for Springfield, the Member for Thompson, all the way along to find out who answers yes and who answers no to attendance and involvement at this particular seminar any more than a sem inar that apparently I'm going to be attending personally tonight at the planetarium. Eating Disorders Clinic MR. SPEAKER: The Honourable Minister of Health. HON. L. DESJARDINS: Mr.

Sp eaker, I think the Hono urable Member for St. Norb ert asked me a question that I took as notice. It was the funding of the Eating Disorder Clinic at the Health Sciences Centre. I wish to say to him that at no time was the hospital approached, the Manitoba Health Services Commission, to request any funds for that. At no time did they indicate that this was a high priority of theirs.

This is something that was done, although the commission kept on paying the doctors to deliver this se rvice, on fee for service, the situation was that this was a program of the hospital with the block funding, if my honourable friend understands the setup, the choices they have on certain programs. I want to say, though, to my honourable friend that the hospital has changed their stand and they will now fund - I think it's the nurse that had been funded -

Monday, 21 March, 1983 until there is a clear decision what their policy and the prioriti es are at tha t ho spital, and un der these circumstances I don't think it would be proper for either the commission or the government to be involved with something that is a decision of the hospital. MR. SPEAKER: The Ho nour able Mem ber for St . Norbert. MR. G. MERCIER: Mr. Speaker , I thank the Minister for that answer, but I would ask him, Sir, in view of the fact that there are 25 people being treated by the Eating Disorders Clinic, and in view of the fact that there are another 31 on the waiting list to be treated - I think in today's newspaper there is indeed a newspaper

article about a psychiatrist who is involved in that program in a su rvey, and it is a serious health problem for many people - is the Minister of Health saying that because this comes under a block-fu nding grant to the hospital that if the hospital finds it doesn't have sufficient funds, for reasons that the hospital itself decides, that this program can be done away with? HON. L.

DESJARDINS: In view of the fact that the member belongs to a party that is stating that we have too large a deficit; in view of the fact that the member, although first approved the closure of certain beds, now want to see them opened; in view of the fact that there are many of the other groups like this that are certainly valid; I think that the best place to discuss this and I recognize the importance of the program, I think that should be done during the Estimates because there is no way that we can respond and I think it would be wrong just by pressure on every program.

There has to be an orderly way and that is done through the hospital. We believe that the hospital and the boards and the medical group in certain hospitals should priorize and this is what we're doing. We' re not going to make a decision and bypass the hospital that encouraged that. We're going to look at this in an orderly fash ion. Health-care sy stem restoration - election promise MR. G. MERCIER: Mr. Speaker , would the Minister like to explain the election promise whereby Manitoba New Democrats would restore the health care system? HON. L.

DESJARDINS: I' m very pl eased - (Interjection) - you took the words right out of my mouth, I'm very glad to. I think that the situation, if you're going to restore this, first of all, you have to do it in a resp onsible way and I think that you have to look at the situation at the front, - (Interjection) - well do I have a chance to answer this, or do you all know the answers. MR. H. ENNS: You can't stand the heat, Larry. HON. L. DESJARDI NS: I can stand all the heat you can give me, as long as you give me a chance to answer your questions. I think, Mr.

Speaker, first of all, the same people: across are talking about big government, that the 896 gover nment are trying to play doctors and they make all the decisions. We don't work like that. We work with the hospitals. There has been no reduction in the funds that we've given the hospitals. I've tried to explain to my honour able friend - (Interjection) - what's that? MR. H. ENNS: The promise talks about a massive restoration. HON. L. DESJARDINS: We are. We're doing exactly that and to do that you've got to repriorize, you've got to stop du plication and you've got to make some very hard decisions.

If that's what you want, you've got to be suppor tive or at least you can't be on every side of every issue. Talking about the heat, you'll have to be able to face the decisions that you have to make that are not always the most easy and that'll be controversial. (Interjection) - If you don't know that, you'r e not very bright. MR. SPEAKER: The Honourable Member for Fort Garry. MR. L. SHERMAN: Mr. Spe aker, I'd just like to ask the Minister of Health whether one man's restoration is another man's cutback? HON. L.

DESJARDINS: I'm ready to debate with my honourable friend any day and I hope that we will in the Estimates, because I understand that he is now giving a service as a consultant on health and I want to see what kind of consulting we'll be doing. MR. L. SHERMAN: Would the Honourable Minister consider, Mr. Speak er, that he had four years of that experience and during that time he and his colleagues addressed every rationalization we tried to bring to the health-care system as a cutback? HON. L. DESJARDINS: Mr. Speak er, there is a bit of HON. S. LYON: That's a hypocrisy, that's a hypocrisy. HON. L.

DESJARDINS: Watch out, you had to withdraw that word once before and you might have to do it again. There is a bit of truth in what my honourable friend has just said, because I think when he was on this side, I think he was sucked in and he responded to every thing. My intention is not to run every single hospital. You know, we asked him a question, he was going to see the next day, he was going to correct it. The boards of certain hospitals have certain responsibilities. They will priorize and I'm not going to answer every question that he tried to answer.

That was his busi ness; I'm not going to operate like that. NON-POLITICAL STATEMENT MR. SPEAKER: The Hono ur able Mem ber for Concordia. MR. P. FOX: Thank you, Mr. Speak er. I'd like to make, with the indu lgence of the Ho use, a non-politi cal statement. (Agreed) Thank you, Mr. Spe aker.

Monday, 21 March, 1983 Words are often inadequate but I would like to express my gratitude, and that of my children, Elaine, Kenneth, Donald and his wife, Bev, for the many messages of sympathy and condolences received in the past few days. I would like to thank the Leader of the Opposition, and my colleague, the Member for Radisson, for their wonderful tribute on last Tuesd ay, the words they had to say about my wife. Mr.

Speaker, I should also like to express my gratitude to the Reverend Bill Blaikie for his comforting eulogy on Friday, and also, as well, my thanks to the Ladies Auxili ary of the Royal Canadian Legion, Prince Edward Branch, for their help on Friday afternoon. There are many more words I would like to say, Mr. Speaker . Nancy was a friend to all, and all were her friends. She was a devoted mother and a wonderful soulmate to myself. We will all miss her. My deepest and heartfelt thanks to everyone for their kindness. Thank you. ORAL QUESTIONS Cont'd Manfor Operation, The Pas MR.

SPEAKER: The Honourable Member for Turtle Mountain. MR. B. RANSOM: Mr. Spe aker, my question is for the Minister of Energy and Mines. At the time that the government changed in Novem ber, 1981 negotiations were under way between the province, the Federal Government, and the private corporation with respect to some refi nancing and res tructuring of the Manfor operation at the Pas. I wonder if the Minister of Energy and Mines could advise the House now as to the results of those negotiations MR. SPEAKER: The Honourable Minister of Energy and Mines. HON. W. PARASIUK: Mr.

Spe aker, at the time the gov ernment changed hands, in No vem ber, the negotiations under way at that stage between the government and a private company had in a sense stop ped . We had rene wed di scussions with that company; we have kept them informed of what we are doing in terms of a fed eral-provi ncial study as to the options with respect to Manfor, because, Mr. Speaker, any investments with respect to Manfor, as hypothesized by anyone, entailed federal contributions ano federal input. Mr.

Speaker , the reason why we're going through the detailed study in concert with .t he Federal Gover nment is to insure that Manitoba gets as fair and equal a treatment with respect to federal contributions to the forestry industry as have other companies and provinces to the east of us. MR. B. RANSOM: Mr. Speaker , I believe that study has been under way for some time. Can the Minister advise the House when that study might be completed? HON. W. PARASIUK: Mr.

Speaker, we're hoping that it would be completed in the next two to three months. 897 There's some work required by some federal people on this, but we are hopeful that it will be completed in the next two to three months. At that stage, of course, it'll be considered by the management, and by the board, and I would expect to be hearing from the board and management as to their recommendations of the alternatives that might be pursued. MR. B. RANSOM: Mr.

Speak er, since the Minister apparently will be asked by the Manfor Board to have the government provide anywhere from $50 million to $400 million of refi nancing and upgrading for Manfor, will the Minister assure the House that his first priority will not be for the government to unde rtake this alone, but will be to seek private sector input. HON. W. PARASIUK: Mr. Speaker, what we are doing is looking at all the options. We certainly haven' t precluded any type of priv ate involvement in the development.

Many of the private companie s tha t had been approached in the past, and are continuing to be app roached , are finding that their own cash flow situation is extremel y tight. In fact, some of the companies have gone into what's called a

Chapter 11 Bankru ptcy, in the United States, where they've had to reorganize their own financial affairs in particular plants that they have, but certainly we don't preclude private involvement. We have been looking at it to ensure that we have the full est opportunity of locking in markets, especially if the option of going to a bleached craft operation was pursued. MR. B. RANSOM: Mr. Speak er, during the election of 19 81, the First Minister promised that his government would put $10 million into upgrading the Manfor operation. That would be sufficient to see the company into the future for some time.

Can the Minister of Energy and Mines now confirm whet her that was ei ther willful mis lead ing of the electorate or a dismal ignorance of the facts? HON. W. PARASIUK: Not at all, Mr. Speaker. Indeed the truth of the matter is that some thing in the order of $10 million may indeed be required for the sawmill operation to establish its future into the longer term. The situation with respect to the pulp and paper complex has been dramatically altered, Mr. Speaker , by the Federal Government in its negotiations on tariffs whereby our tariff protection is being lost, Mr.

Spe aker, for the type of product that we produce. Mr. Speaker, the rather interes ting thing in this respect is that the previous management and board had made recommendations to the previous government calling for improvements and investments in Manfor, of a small nature, Mr. Spe aker, which would have stabilized that operation more so but, Mr. Sp eaker , those re commenda tions were ign ored by the previous administration because they had their intentions set to sell off the corporation, Mr. Spe aker. Interest Rate Relief Program re farmers MR. SPEAKER: The Honourable Member for Roblin­ Russell.

Monday, 21 March, 1983 SOME HONOURABLE MEMBERS: Oh, oh! MR. SPEAKER: Order please, order please. The Honour able Member for Roblin-Russell. MR. W. McKENZIE: Thank you, Mr. Speaker . Mr. Spe aker, I have a question for the Premie r, the First Minister. Mr. Speaker, I wonder if the First Minister and his government have satisfied themselves that the Interest Rate Relief Program for farms has failed the farmers miserably and that the govern ment's new regulations and guidelines to MACC has also failed the many financially strapped farmers in this problem miserab ly.

Is he and his government now, according to Winnipeg Sun, prepared to sit down with the banks and the financial institutions in our province and help solve the dilemma our farmers are facing? MR. H. PAWLEY: No, Mr. Speaker . MR. W. McKENZIE: Mr.

Speaker , since last Thu rsday, on the opening of the Estimates of the Minister of Agricultur e, the Honourable Minister refused to deal with the serious problems when I pleaded with him and the former Minister of Agriculture, the Member for Arthur, pleaded with the Minister of Agriculture to come to grip s and deal with the problems that the se financially-strapped farmers are facing today. Does the Minister agree with the statement that's in today's paper that as many as 1, 000 farmers may not be able to muster enough cash to put a crop in the ground this spring? HON. H. PAWLEY: Mr.

Speaker , there is a serious problem confronting agriculture, not only in Manitoba, but all of Canada. One need only look for a moment or two at some of the national broadcasts of auctions that are taking pl ace involving the sale of farm equipment because of foreclosures on the part of the banks . Mr.

Speaker , if the honourable member is wishing to identify the reason and cause he need not travel too far, indeed in today's question period, to the very commencement of today's question period, as to the reason by which farmers and busine sses and workers and others are in difficulty in this land and it relates right back to the kind of policies that have been proclaimed and pushed by the Governor of the Bank of Canada. MR. SPEAKER: The Honourable Member for Arthur. MR. J. DOWNEY: Mr.

Spe aker, in view of the fact that the First Minister of this province has indicated that he's not going to sit down and discuss the financial difficulties of the farm community with the banking commun ity, and in view of the fact tha t there is legislation in Ottawa presented last week to deal with this particular issue, is he going to bring in companion legislation in Manitoba to bring in debt moratorium for the farmers in Manitoba? MR. SPEAKER: The Honour able First Minister. HON. H. PAWLEY: Mr.

Speaker , certainly I did not want to leave any impression that we were not prepared to 898 sit down with the farmers in this province and discuss the financial situation that is introduced as a result of backward looking financial policies that have been pursued for the last number of years; certainly the Minister of Agriculture is most anxious to do so, has been doing so, and will continue to do so.

One of our responses to that had been the Interest Rate Relief Program that the Honourable Member for Russell just referred to, that indeed has assisted some hundr eds of farmers and the precise number can be made known to honourable members. That has been a provincial initiative, limited as to its scope and ability, but it has made a significant contribution to assis ting the farmers in the Province of Manitoba. I believe, Mr.

Speaker , it may be the only such Interest Rate Relief Program of its type in Canada attempting to help, in some limited way, within the provincial jurisdiction of the agricultural community. HON. S. LYON: The only ineffective one in Canada, that's true. A MEMBER: The only one that's failed, Howie. MR. J. DOWNEY: Mr. Speaker, does the First Minister support the legislation that was tabled in Ottawa last week, which in fact, would bring in debt moratorium legislation?

Is he going to bring parallel legislation or supplementa ry, complementary legislation into this Assembly , at this particular time, or at this Session? Does he support that program or that proposal? HON. H. PAWLEY: Mr. Speaker, by the way, I have some information as to the - I gather some 702 applications have been approved and thousands of more farmers have received financial management consultations, so 702 farmers in the province are presently receiving Interest Rate Relief assistance in the province. I suppose the Honourable Member for Russell was asking the question in ignorance of that basic information.

Mr. Speaker, I'm encou raged by the initial reports I've received pertaining to the federal legislation. I don't interp ret the legislation to be debt moratorium legislation but rather a referral kind of legislation. We are certainly interested in perusing that legislation and if complementary legislation is required at the provincial level, to cer tainly ex amining and considering the feasi bility of doing so. In principle it appears to me that the step, by way of the legislation tabled in Ottawa, is a positive one and it deserves serious consideration on the part of the Province of Manitoba. MR. J. DOWNEY: Mr.

Sp eaker, I have a final supplemen tary. In view of the position that the First Minister has taken that he is contemplating or will be contemplating bringing in debt moratorium legisla tion, is he prepared, Mr. Speaker , to instruct his government to increase the funds through the Manitoba Agricultural Credit Corporation . . . MR. SPEAKER: The Honourable First Minister on a point of order. HON. H. PAWLEY: On a point of order, I don't know whether the honourable member failed to hear me

Monday, 21 March, 1983 accurately or whether he's intentionally attempting to mislead. My statement was not that we were going to bring in debt moratorium legislation. What I indicated was that complementary legislation, if required by the province, might very well be considered, in view of the federal initiative. MR. SPEAKER: I thank the Honourable Minister for his explanation. The Honourable Member for Arthur. MR. J. DOWNEY: Mr. Speaker, I'm somewhat confused at the response by the First Minister because the

interpretation that I took from his first answer was that in fact they would be moving with legislation. I have a further question, Mr. Speaker. In view of the now First Minister's election promise in November of 19 81 that no farmer or no person would lose their farm or their home, will he in fact make changes to the Manitoba Agricultural Credit Corporation and expand the amount of funds available there, so that in fact that won't happen, if he is not going to move in a legislative way to support the farmers in Manitoba? HON. H. PAWLEY: Mr.

Speaker , there appears to be some difficulty across the way in honourable members getting their act together. If my recollection is accurate, 30 minutes ago the Leader of the Opposition had indicated there wasn't an interest rate problem now. I recall a statement on the part of the Leader of the Opposition but 30 minut es ago to that effect. Now we have the Member for Arthur, backed by the Member for Russell, disassoc iating themselves from the position by the Leader of the Opposition, in advising us, Mr. Speaker , that there is . . . SOME HONOURABLE MEMBERS: Oh, oh! MR. SPEAKER: Order please. HON. H.

PAWLEY: . . . a serious interest rate crisis. - (Interjection) - Mr. Speaker , if a recess is necessary for honourable members to get their act together, I would suggest that we do likewise now. MR. J. DOWNEY: Mr. Speaker , I will fully associate myself with our leader and, in general, the majority of interest rates have gone down a considerable amount in this country, except for those that his Minister of Agricultur e is maintaining at 18 percent under the Manitoba Agricultural Credit Corporation, which he refuses to lower. HON. H. PAWLEY: Mr.

Spe aker, if that was a question, I couldn't hear it for the banging of desks across the way, so the honourable member would have to repeat the question because I just couldn't hear it for all the noise across the way. A MEMBER: Hit him again! MR. SPEAKER: Does the Honourable Member for Arthur wish to reph rase his question? MR. J. DOWNEY: Mr. Spe aker, I have no difficulty in repeating that because it is in the best interests of the 899 farm commun ity, unlike what the First Minis ter is prepared to do in anybody's intere st . The question was, Mr.

Speaker, is he prepared, and I said to start off with, because he didn't hear me - I want to make sure that he does - that I fully associate myself with our leader of our party, who did a lot of things to help not only the farm commun ity, but Manitoba. The question is, will he instruct his Minister of Agriculture, who is maintaining for some of the farmers, under the Manitoba Agricultur al Credit Corporation, an 18 percent interest rate, will he instruct his Minister of Agriculture to lower those to those farmers that are trapped in that 18 percent interest rate level? MR. SPEAKER: The Honourable First Minister.

HON. H. PAWLEY: Now that the member has indeed clarified his position in rela tionship to the position adopted earlier by the Leader of the Opposition, then, Mr. Speaker , certainly insofar as the latter part of his question, this government is open to any constructive views that may be expressed. We're certainly prepared to exam ine same, but I mu st em phasi ze to the honourable member that this side of the Chamber and this government has to also be very conscious of the financial implications of any proposed offer. SOME HONOURABLE MEMBERS: Oh, oh! Pruning of trees re Dutch Elm disease MR.

SPEAKER: The Honourable Member for Pembina. MR. D. ORCHARD: Thank you, Mr. Speaker . My question is for the Minister of Natural Resources. Last week I posed the question as to whether he could make available personnel and equipment from the Dutch Elm Disease Control Program to u.ndertake pruning of trees damaged by the recent ice storm in communities of southern Manitoba. He indicated last week that he would approach his department to see if that equipment and personnel could be made available. Is the Minister willing to offer that equipment and personnel to those communities? MR.

SPEAKER: The Honourable Minister of Natural Resources . HON. A. MACKLING: Mr. Speaker , I did take the question as notice; the department is looking at that. That involves more spending, and of course that's a problem, but we are interested in putting people to work and so we were looking at opportunities for that. I haven't had a report on it yet. When I do, I'll report to the Hous e. MR. D. ORCHARD: I very muc h appr eciate the Minister's answer. It would offer those communities some hope.

I would ask the Minister if he could give a general indication as to how soon he might be able to ma ke a decision on tha t since some of the communities no doubt will be undertaking pruning with equipment that is not safe by any means and, if he could give an indication of how quickly his decision

Monday, 21 March, 1983 could be available to the people, then they might forestall that pruning activity on their own. HON. A. MACKLING: I will attempt to abridge the normal time or prune that time to get an answer quickly. MR. SPEAKER: Order please. The time for question period has expired. ORDERS OF THE DAY MR. SPEAKER: The Honourable Government House Leader. HON. R. PENNER: Mr. Spe aker, would you please call the adjourned debate on the proposed motion of the Minister of Finance on Page 3, standing in the name of the Member for Lakeside. MR.

SPEAKER: On the pro posed motion of the Honourable Minister of Finance that Bill No. 29 . the Honourable Member for Lakeside. MR. H. ENNS: Mr. Spe aker, I ask the indulgence of this House to have this matter stand. MR. SPEAKER: The Honourable Government House Leader. HON. R. PENNER: Mr. Speaker, I move, seconded by the Minister of Finance, 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. MR. SPEAKER: The Honourable Member for Turtle Mountain. MR. B. RANSOM: Just on a point o! order, Mr.

Speaker, will the Minister of Agriculture be present for his Estimates? MR. SPEAKER: The Honourable Government House Leader to the same point of order. HON. R. PENNER: The Minister of Agricultur e was attending a speaking engagement and expected to be back in the House by 3:00, Sir. There may be a short dela y, but certainly it is our intention to proceed with the Agriculture Esti mates, so we would ask the indulgence of the members opposite. I'm sure they need that time in order to sharpen their wits; it became quite obvious during question period. MR.

SPEAKER: On the motion that was put to the House, is it the pleasure of the House to adopt the motion? (Agreed) MOTION p resented and carried and the Ho use resolved itself into a Committee to consider of the Sup ply to be granted to Her Majesty with the Honourable Member for River East in the Chair for the Department of Agriculture, and the Honourable Member for Burr ows in the Chair for the Department of Consumer and Corporate Affairs. 900 CONCURRENT COMMITTEES OF SUPPLY SUPPLY - CONSUMER AND CORPORATE AFFA IRS MR. CHAIRMAN, C. Santos: Committee, please come to order.

May I remind the members that we are on Item 3. (b)(1) ? The Member for Tuxedo. MR. G. FILMON: Mr. Chairman, when we were last on this topic, at the last Session, I asked the Minister a question which he asked to have repeated.

The question was in reference to the Northern Union Insurance Company licence cancellation, if it wouldn't have been better for the department or the Minister to satisfy themselves, prior to cancelling the licence and plunging the company into receive rship, that there wasn't some ability or opportunity on the part of the principals behind the company to come up with sufficient assets or financial support to satisfy the requirements of the solvency

section of the Act. Second ly, if it would not have been better to at least call the bank to the table to find out the basis upon which they had blocked the transfer of funds and give some time, whatever time that would be, a week, 10 days, two weeks, whatever seemed reasonable, for the matter to be sorted through as opposed to taking an action which undoubtedly would plunge the company into receiversh ip and then leave the policyholders or claimants against the company in a position where it had to be obvious that they would not be in a position to collect on unearned premiums or outstanding claims or whatever.

What I am saying is, was there not a case to be made for at least bringing the relevant people to the table and discussing it, putting some time frame on, as opposed to just plunging the company into recei vership? MR. SPEAKER: Mr. Minister. HON. J. BUCKLASCHUK: Perhaps I can just respond to that by, again, providing some background to what took place during the time of the hearings. We met in camera. I failed to mention that before, but I think that's rather relevant to indicate that we were concerned about jeopardizing the viability of Northern Union. The meetings were held in camera.

We had been told by the principals that they had instructed the bank to transfer $4.2 million, I believe, to the Northern Union account. Documentation was produced, I believe, the Tuesday morning, and I believe the Member for Tuxedo has a copy of that documentation attesting that the transfer had been requested. We were informed that afternoon. I believe that a transfer had not been allowed. The hearings were adjourned to a future date. The principals met with the bank the following day and I belie ve they spent most of the day meeting with bank officials.

There was no satisfactory resol ution to the problem, nor was there any request by the principals for us to intervene with the bank on their behalf. In view of the information that had been provided to us, we were satisfied that the situation was serious enough that by not failing to cancel the licence or consider

Monday, 21 March, 1983 cancelling the licence at that time that we were in fact creating the possibility for future, even greater potential losses. So I don't think there would have been any purpose served in delaying the cancellation. MR. G.

FILMON: I'm given to under stand that upon the canc el lation of the licence by the Manitoba Gover nment, the Saskatchewan Government made a decision to place the resou rces of the Saskatchewan Gov ernment Insu rance Com pany beh ind any policyholders in Saskatchewan of the Northern Union Insu rance Company because they recognized that in this whole process of having to change their coverage the people would be left adrift for a certain period of time, whether that be over a weekend or over a period of time 10 days, two weeks, wh atever, while the action could be unde rtaken to replace the insurance with other companies and so on.

They recognize that there was a need for some umbrella coverage, some action to be taken to protect the interests of the policyholders of Northern Union resident in Saskatchewan. The Manitoba Government, it seems to me, was in the same posit ion, and in fact this Minister was responsible and is responsible for MPIC and could have taken the same action. As the Minister knows, I have been critical of him for not providing some short-term umbrella coverage and questioned him about that in the House.

I'm given to unde rstand that Saskatchewan took this action, at least that was some information I've been recently given, and I wonder why the Minister didn't consider taking that action here in Manitoba to protect the interests of the policyholders, at least on a short-term basis until they were in a position to transfer their coverage and effect the necessary changes. HON. J. BUCKLASCHUK: In response to the member's comments, I was aware of the action taken by the Saskatchewan Government Insur ance.

They offered to pick up the personal lines risks at a cost to the policyholder on an interim basis until such time as the policies had been placed elsewhere, or with them. In the situation in Manitoba, I was aware that immed iately upon the notice of cancellation that was publ icized on Fri day that a fairly substantial numb er of agents immed iately contacted MP IC and asked MPIC if they would take on that coverage. I don't recall the exact percentage but I do know that MP IC unde rwrote quite a number of personal lines policies.

I had MPIC take a look at some of the policies that had not been picked up and there certainly was a question as to whether we would wish to assume the type of risk that had been assumed by Northern Union. There certainly is a question as to what our. resp onsibility through MPIC was to the pol icyhol ders in other provi nces or to th ose poli cies that involv ed fairly considerable risk or higher risk than MPIC would have normally picked up. MR. CHAIRMAN: Are you finished with your line of ques tioning, the Member for Tuxedo? MR. G. FllMON: No, Mr. Chairman.

I wonder if the Minister could indi cate, whether in view of the circums tances and the way they evolved whereby 901 because of Ministerial action, the one company was put into receiversh ip, Northern Union, and in essence thrown out of the general insurance field in Manitoba, and the major benefactor appears to be the company for which the Minister is also responsible, MPIC having picked up a large percentage of the coverage in Manitoba, whether or not this is not a direct conflict of interest for the Minister to be in a position of regulating privately held insurance companies and taking actions which affect their viability and indeed their operations and then those actions resulting in benefits to MPIC, the company for which he is the Minister resp onsible to the Manitoba Legislature?

HON. J. BUCKLASCHUK: I gather the Member for Tuxedo didn't hear me. I had said that the insurance agents approached MPIC. At no time did MPIC solicit the agents for Northern Union policies, so I certainly can't see there's any conflict. Furthermore, there was no obligation on the part of MPIC to pick up these policies, that the agents came to MPIC. MR. CHAIRMAN: The Minister of Urban Affairs. HON. E. KOSTYRA: Thank you, Mr. Chairman. MR. G. FILMON: Mr. Chairman, on a point of order.

I thought we had an unde rstanding that as long as a member was pursuing a line of questioning with the Minister he would continue to be allowed to pursue that line of questioning until he was completed. This has always been the unde rstanding in committee and, if we're now going to cut off members so that a Minister can be bailed out by one of his colle agues, then I think it's absolutely ridiculous. MR. CHAIRMAN: Does the Minister of Urban Affairs wish to yield the floor? HON. E. KOSTYRA: Mr. Chairman, that, with all respect, is an improper point of order.

I haven't been through committee hearings before and I was never aware of that rule being established. However, I would not want any thought be left that my intervention or the questions that I was going to raise were in any way trying - in the terms of the honourable member - to bail out. It was rather to seek some further information and I certainly don't want to interrupt the line of questioning from the Member for Tuxedo because he may lose his train of thought, so I would voluntarily hold my questions until the time when he has finished his current line of questioning. MR. CHAIRMAN: Thank you, Mr. Minister.

It just happened that your hand caught my eyes first at that instant. The Member for Tuxedo. MR. G. FILMON: Thank you, Mr. Chairman. In pursuing the Minister's response, I fully recognize that the MPIC may well have been contacted by agents to replace the coverage with MP IC, but if the red uction of competition in the availability of general insur ance coverage in the province has the net effect of red ucing the options, then obviously more of that insurance,

Monday, 21 March, 1983 even if it's placed on a prorata basis of all the companies involved, it's to MPIC's benefit for companies to be closed down and licences to be cancelled . Is this not a direct conflict of interest? HON. J. BUCKLASCHUK: The remarks about dimini shing com petition were rather interesti ng. Northern Union was not one of the largest insurance companies in Manitoba, I can assure you.

I should also assure the Member for Tuxedo that it was neither the Department of Consumer and Corporate Affairs nor MPIC that brought about the problems that Northern Union was exper ien cing, so ho w we could have benefited from something that is entirely out of our control is hard for me to understand. MR. CHAIRMAN: On the same line of questioning? The Member for Tuxedo. MR. G. FILMON: Is the Minister saying that he didn't cancel the licence of the insu rance company? HON. J. BUCKLASCHUK: I readily admit to cancelling the insurance licence in the interests of the policyholders. MR. G.

FILMON: Isn't the cancellation of the licence what caused the policyholders to have to seek alternate coverage? HON. J. BUCKLASCHUK: I think the response to that is to have allowed Northern Union to continue would have left policyholders with absolutely nothing. We hope that in the process of cancel ling the licence that there will be some assets left to pay off existing claims and to at least prorate some of the premium rebates. MR. G.

FILMON: Is the Minister saying that the assets would have been withdrawn from the company in some way, so that there would have been - had they allowed the company to operate for another day, then the assets would have gone down to zero overnight? HON. J. BUCKLASCHUK: No, I certainly didn't say that. What I meant by that was that allowing the company to continue in operation, with what we now certainly see as being a bit of a pattern, the assets would have been diminished fu rther. MR. G. FILMON: Were the shareholders of the company given an opportunity to put up additional assets? HON. J.

BUCKLASCHUK: Yes, they had been. MR. G. FILMON: Was that just within the two-day period of the hearing, Mr. Chairman? HON. J. BUCKLASCHUK: Yes, su bsequent to a November 4th meeting with the Acting Su perintendent of Insur ance and, I believe, the Acting Deputy Minister of Consumer and Corporate Affairs, there had been a commitment given by one of the principles to have deposited, or to have into Northern Union an additional $1.5 million by the end of the year. As I had mentioned 902 last week, this was one of the commitments that had not been kept. MR. G. FILMON: Mr.

Chairman, we've covered that ground and that's a matter that I'm sure will be pursued in various legal actions that will no doubt ensue from this whole matter.

But getting back to the overall concern of conflict of interest and assu ming that we're not even talking about Nor thern Union Insu rance Company, with the Minister having the power to regulate and in effect cancel licences of operating insurance companies, as well being the Minister responsible for MPIC, is this not a direct conflict of interest, where he is acting not only as re gula tor, but as in effect , owner and competitor of general insurance companies in this province? HON. J. BUCKLASCHUK: I see no conflict whatsoever.

The cancellation was by Cabinet and the fact that the government is involved with MPIC, I believe, has no bearing whatsoever on this situation. MR. G. FILMON: Mr. Chairman, one of the members opposite just said it's always been that way. It has not always been that way, where the Minister responsible for MPIC has also been the Minister responsible for the administration of The Insu rance Act.

This is the first time, as far as I'm aware, in the history of the province and it puts the Minister in the position of being a competitor or res ponsible for the operation of a competitor of the insur anc e compan ies that he regula tes. I see it as a direct conflict of interest. I'm surp rised that the Minister can't see that. HON. J. BUCKLASCHUK: The member may be quite correct.

This, to my knowledge, is the first time a licence for an insurance company's been cancelled in Manitoba, but cancellation of a licence to protect the interests of policyholders can no way be seen as some sort of a conflict between that responsi bility that I have and my responsibilities for Manitoba Public Insurance Corporation. MR. G. FILMON: The cancellation of a licence for the protection of the policyholders may be one thing, what about cancellation of a licence for the opportunity to expand the interests of MPIC? - (Interjection) - I'm saying it's possible. MR.

CHAIRMAN: Is the Member for Tuxedo asking a question? MR. G. FILMON: Pardon? A MEMBER: Is that the motives you're imputing? MR. G. FILMON: I'm not imputing any motives, I'm suggesting to the Minister of Urban Affairs that in the situation where one Minister is both resp onsible for the operation of an insurance company in the field of general insurance, where he is a direct competitor with the companies that he is licencing and regulating, he has a direct conflict of interest and he has been put in that position unfairly by his Premier and his Cabinet and I say to you that as long as he's in that situation,

Monday, 21 March, 1983 he's going to be in a position of being suspected of th ose motives by people regardless of whether that's me or others. HON. J. BUCKLASCHUK: Well, again I can say that 1 certainly cannot see any confl ict of in terest whatsoever and I think the Member for Tuxedo is trying to build an extremely weak case. MR. G. FILMON: Mr. Chairman.

I now see the problem that we have with respect to the mem bers of the government's kno wledge and information on conflict of in terest, when they cannot see that this is an absolutely dir ect conflict of inte rest, then I know why we have a problem with conflict-of-inter est legislation in this province and that is that members opposite don't understand what a conflict of inter est is. HON. J. BUCKLASCHUK: Well, I'm glad the member raised that because it is our intention to introduce conflict-of-inter est legislation and I would suggest that if anybody had any problem with it. it's the opposition.

We are the ones who are introducing that legislation. MR. G. FILMON: That's exactly right, Mr. Chairman. The government is intr oducin g conflic t-of-interest legislation that doesn 't prevent direct conflicts of inte rest from taking place, such as this one. it's not worth the paper it's printed on. MR. CHAIRMAN: The Mini ster of Urban Affairs and Cultural Affairs. HON. E. KOSTYRA: Mr. Chairman, just on the latest line of questioning with respect to conflict of int erest, I've never heard such nons ense in my life coming from the Member for Tuxedo.

I would ask the Min ister to respond whether or not he, as the Min ister respon sible for The Insurance Act and the Minis ter responsible for the Man itoba Public Insuranc e Corporation if he received any personal gain out of the transactions that have taken place with respect to the subject insurance company or the Manitoba Public Ins urance Corporation.

To suggest, in such a perverse way as the Member for Tuxedo suggested, that ther e's a conflict of int erest because the Mi nister is charged with the responsibility of The Insur ance Act and the Manitoba Public In surance Corporation, probably that same situation would reflect on most, if not all Min isters of the Crown . To give a parallel example you have - and this was the same in the Cabinet that he was a member of - you have the Min ister respon sible for Ene rgy and Mine s also responsible for Manitoba Hydro.

Manitoba Hydro is a Crown corporation in the field of providing ene rgy, one form of energy to the residents and the citizens of the province; and you have the Minister responsi ble for other matters related to energy in the province, such as the distribution of gas in various cities and communities.

So taking his argument with respect to conflict of int erest to that extreme, there's a conflict there because here you have a Min ister responsible for a Crown corpora tion, Manitoba Hydro, that provides energy in one form to residents of the province and is also responsible for energy policy generally in the province. So that would put him in a 903 conflic t of inter est position given the honourable member's suggestion which is just totally ridiculous, Mr. Chairman.

I ask the Min ister to respond after whether or not he has received any personal gain as a result of the actions that he was respon sible for as the Min ister responsible for a statute of the Province of Mani toba, that being The Insurance Act, which has prescribed legislative actions that have to take place with respect to the kind of situation that confronted the Minis ter. I'd ask him whether or not he received any personal gain from that transaction because, if he did, then that would be a situation of conflict of interest.

I believe that the Minister was acting as he ought to, to protect the public good with respect to the operation and licenc e of ins urance companies in the province. The second question that I'd like to ask the Minister is that if the action that was taken with respect to Northern Union, if it was not taken, could he confirm that there would be further losses incu rred by residents, individuals, businesses in the Province of Manitoba, far greater damage than was done under the present situation?

I have one final question to ask the Min ister, that again is in line of the questioning of the Honourable Member for Tuxedo when he asked a question with regard to the sit uation during the period of the hearings that were held with respect to this insurance compa ny, wherein he asked whether or no t there was any opportunity given to the shareholders of the company to arrange for alternate financing.

I wonder if the Min ister could tell me whether or not the problems related to this insurance company were those that occurred during that two-day period or were they actions or situations that occurred over a longer period of time than those two days, and whether or not the company had on its own, prior to the actions that were taken and the in vestigations taken by the Superintendent of Insurance, if the company had the opportunity to put its own financial affairs in ord er. HON. J. BUCKLASCHUK: Okay, I'll attempt to answer those questions.

First of all, were there any personal gains that I received from this? - I can assure the member that absolutely none - as a matter of fact, the Member for Tuxedo would leave us with the im pression that I took some sort of great plea sure in the cancellation of this licence. I can also assure him that is as remote from reality as possible. 1t was a very difficult decision to make; it was one that we made with great reluctance. 1t was one we made after giving the principals of Northern Union every opportunity to resolve the problem.

With respect to the remarks about MP IC benefiting from Northern Union's demise, I would suggest that the Member for Tuxedo review the annual statement of the Mani toba Public Insurance Corporation I tabled last week. Ju st from a very qu ick perusal, and particularly of the general ins urance portion, one would note that M PlC has grown considerably in that particular area and cer tainly would not need the cancellation of Northern Union to enhance its premium income or position in the insurance indu stry. With respect to the qu estion about whether opportunities had been provided to the principals of

Monday, 21 March, 1983 Northern Union to put the company back in some sort of financial position where it could survive, I had mentioned the opportunity had been given and the commitment that had been given by the principals in Nov ember to inject an additional $1. 5 million, a commitment which was never kept. The opportunity that was provided during the hearings to have the transfer of funds take place, that transfer was not carried out.

The fact is tha t the insur ance company during the time of the hearings was in substantial default, not something that occurred in the two days of the hearings, or in the two days previous to the hearings, or to the days from which they were given notice. It was a matter that had accumula ted over a number of months. It was my feeling that there was no way in view of the circumstances that the assets, or the assets within the company, could be brought up to a level that could justify the continuation or the existence of the company.

I should mention, and I have failed to do this so far, that since the Member for Tuxedo apparently has some indication of the finances of Northern Union, he should be aware that had the trans fer been allowed that the overdraft limit with the bank would have been exceeded by some $4 million or $5 million. It was that reason that the bank had, as far as I know, refused to allow the transfer. It's nice to play with money that you don't have and that's what appeared to be the situation. MR. CHAIRMAN: The Honourable Member for Tuxedo. MR. G. FILMON: Mr.

Chairman, did the Minister speak with representatives or officials of the bank about this matter? HON. J. BUCKLASCHUK: I have not had any contact with the bank. MR. G. FILMON: Then on what basis did he make that last statement? HON. J. BUCKLASCHUK: The basis on which I made that statement was evidence provided to us under oath at the hearing by the principals as to what their line of credit was and with the statement that was provided to us during the hearings. MR. G. FILMON: The statement about the excessive overd raft was made by the principals? HON. J.

BUCKLASCHUK: We were presented with the financial statement at the hearings indi cating the position of the cash concentration account. We were also provided with information as to what their overdraft authorization was at the bank. It didn't take very much to ascertain, to notice that they had exceeded their authorized line of credit and, had the transfer been allowed, it would have exceeded the line of credit by an additional $4 million. MR. G. FILMON: Were the principals ever given an ultimatum of putting in fresh assets into the company in order to continue its opera tion? HON. J.

BUCKLASCHUK: The principals had provided us with some information about a pending sale which, 904 while they led us to belie ve that there was nothing more than a signature required, we had other evidence presented to the effect that in fact such a sale was not imminent. MR. G. FILMON: Who provided the other evidence? HON. J. BUCKLASCHUK: That information was provided by document by the Su perintendent of Insurance. MR. G. FILMON: Back to the statements made by the Minister of Urban Affairs, Mr.

Chairman , he indicated that this whole thing had not occurred on a shor t-term basis, but rather it was a long-term action, and since he wasn't here the other day when we were reviewing the process I will lay out for him the information as I have it. No. 1, the licence of Northern Union Insur ance Company was renewed by the Provincial Government and this Minister on January 1s t of 1983. No. 2, sometime later that month, the company was invited to appear at a show-cause hearing on February the 8th and 9th. Now it seems to me, Mr.

Chairman, that in terms of the public record, the actions that occurred had all occurred within about a month of this meeting. The strong position that was taken by the Minister and the lack of opportunity that was given to the company to perhaps meet the Minister's requirements was not evident by the process of events that is on the record. The next thing is that the Minister seems to be under the mistaken impression that the only type of conflict of interest that can occur is where there is a personal gain to the Minister.

I suggest to him that there are many other instances in which conflict of interest can take place that doesn't involve personal gain to the Minister. Let me suggest that I am not in any way refer ring to this particular case and so perhaps it would be best for me to outline my examples when I speak to the bill that's before us in the Legislature. But to suggest that the only reason there could be a conflict of interest is because it would result in personal gain to a Minister or a member of the Legislature is absolute fol ly.

There are many kinds, not the least of which is the setting up of an unfair competitive situation on behalf of any one party as a result of legislative or government action which is the case in this particular set of circums tances. MR. CHAIRMAN: Does the Minister of Urban Affairs wish to react to that remark from the Member for Tuxedo? MR. G. FILMON: I'm sorry, I'm not through and the Minister can react later. The Minister made some statement about there is no way that the assets could have been made to reach the required level.

If the Minister has evidence to that effect , that the company was given an ultimatum and was given the opportunity to produce additional assets to satisfy the solvency ques tion, that's fine, but so far he has not produced us that evidence. The Minister of Urban Affairs referred to the fact that ther e would be gr eater losses from a conti nue d operation of the company. I suggest to him he's ignoring

Monday, 21 March, 1983 the fact that the company, as long as it was operating, was a viable operation that had some value - and I think that's evidenced by an offer that was pending on it -whereas when the licence is cancelled it automatically drops in value substantially. Not only does it not have a value as an operating company, but you're forced with liquidating it at, shall we say, fire sale prices where you've got to start gathering up the typewriters, desks and leas ehold improvements.

They generally don't have the value that they are shown on the books because they have to be sold as sec ond-hand goods and depreciated prices. He was automatically condemning the policyholders of Northern Union to not being able to receive benefit or value for their investment in the company. That is a situation which I don't believe the Minister or the government addressed when it made its decision. HON. J. BUCKLASCHUK: I just want to very quickly respond again that the problem that we faced with Northern Union was certainly not something created by the department nor by MPIC.

I think the Member for Tuxedo should be able to understand that we cannot be held responsible for the actions of the insurance agents who took the initiative and approached MPIC to write the policies for the former Northern Union policyholders. They also had equal oppor tunity to approach the private sector and I'm sure they did. So how that can be construed as some sort of a conflict, this I don't understand. I must reiterate, because I presume the Member for Tuxedo didn't hear me, I ha d ind icated we had documentation presented to us at the hearings that there was no offer for any sale of Northern Union.

So if we want to keep arguing on the basis that there was an offer that we jeopardized, that's a very faulty basis to operate on because there had been no offer. HON. L. DESJARDINS: Gary's advocating socialism again. MR. G. FILMON: Mr. Chairman, earlier in this Ses sion, I had placed some questions before the Minister of Economic Development, and I think she responded by turning over some of the questions to the Minister resp onsible for The Insur ance Act with respect to the impending sale of the Monarch Life Assurance Company to an eastern com pany.

As I stated during my questioning, it would seem to me that this move represents a rationali zation within the insu rance industry, a rationalization that will undoubtedly see, after a period of time over which the moves will take place, it will undoub tedly result in only just a marketing component left in Winnipeg. I am wondering what discussions the Minister has had with the federal counterpart with respect to the allowance of the sale of Monarch Life to North American Life. HON. J.

BUCKLASCHUK: As I had indicated to the Member for Tuxedo, the morning after the announcement, or the morning of the announcement, I did sit in with a meeting with the Premier and Mr. Thompson, the President of Monarch Life Assurance Company. He did indicate that the sale of Monarch Life, the offer to pu rchase was initiated by North 905 American Life, and he had given us a commitment that Monarch Life would maintain a presence in Winnipeg. I would like to just quote from a letter from Mr.

Thompson to all employees, managers, general agents and agents, and he states, "Following amalgamation, the companies will maintain a strong presence in Winnipeg, a commitment made to the Minister of Finance by the President of North American Life. Some parts of the busine ss of the combined companies will be conducted from the present head office of Monarch Life with the intention that the present number of emp loyees will continue to be employed in Winnipeg." I might indicate that Mr.

Thompson had indicated there would be some restructuring of the operations within Winnipeg and that it was indeed conceivable that there might be an increase in staffing. Furthermore, he indicated that there would not be any change in the investment policies of Monarch Life with respect to investments in Manitoba, so there really was not much pur pose in our meeting or contacting the federal Minister responsible on this issue. MR. G. FILMON: Wh at period of time is tha t commitment valid to maintain the same number of staff here in Winnipeg? HON. J.

BUCKLASCHUK: I don't see a specific period of time here, whether it's one day or one year, but Mr. Thompson did assure us that into the future, there was a potential of a greater number of emp loyees being present in Winnipeg than at the present time. MR. G.

FILMON: Does the Minister believe that in terms of administrative staff, such as those who are employed in, say the computer sec tion, or the investment section, or the se nior ad minis trative sec tion, that giv en a combination of companies, such as will happen by virtue of this sale, it's likely that all of these services would be dupl icated in Winn ipeg when the cent ral administration will now be out of Toronto? HON. J. BUCKLASCHUK: No, I think the very opposite. What I meant to convey was that in fact the Winnipeg office would become special ized in one area of the total North Am erican Life opera tion.

Ju st as some departments would move to Toronto, there would be a transfer of emplo yees and responsibilities to the Winnipeg Branch and, in fact, it would specialize. MR. G. FILMON: What type of specialization would be located in Winnipeg, Mr. Chairman? HON. J. BUCKLASCHUK: Well, I believe that Mr.

Thompson indicated it would those - I can't recall that he specifically indicated it would be this responsibility or that res ponsibility, but he did mention that because of the advanced state of communications, computers and so on, that they could virtually run any aspect of the busi ness out of Winnipeg, out of the total operation. MR. G. FILMON: Mr.

Chairman, given the fact that many of the staff members of Monarch Life have been given indications that if they want to remain in positions with the company, they're going to have to move to Toronto, I'd like to know what sections the Minister sees as being transferred from Toronto to Winnipeg.

Monday, 21 March, 1983 HON. J. BUCKLASCHUK: Well I can't comment on that but I sup pose the comment I could make right now is that it's not our respo nsibility to tell North American Life how to run their operation. We have a responsibility in terms of regula tory reponsibil ities, but certainly when it comes to the internal operations of North American Life or any insurance company, that's not within our jurisdiction. MR. G. FILMON: Mr.

Chairman, does the Minister then dis agree with his colleagues, who have intervened in other situations, in which there would be a potential loss of jobs and closing down of operations in Manitoba, such as the Kimberly-Clark situation, in which the Minister of Labour and the Minister of Econ omic Devel opment have become involved. Does he feel that they have then wrongly become involved, since, as the Minister puts it, it's none of the gove rnment's busi ness as to how these companies redeploy their staff and rationalize their operations? HON. J.

BUCKLASCHUK: Well, I'm glad the mem ber mentioned the concerns about loss of staff. Certainly we are concerned about the loss of staff and at our meeting we had been assured that the present number of emplo yees will continue and I think that's the important thing. If the emplo yees are here then what other concerns would we have? MR. G. FILMON: Mr. Chairman, but the Minister earlier indicated that the continuation of the num ber of emplo yees was not for any fixed time. It might be for one day or one year - he wasn't sure - so that's not very much of a commitment. MR. P.

FOX: Faith in private enterprise isn't very high, is it Gary? MR. G. FILMON: Mr. Chairman, I have a great deal of faith in private enterprise, to respond to the Member for Concor di a, but when the y' re dealing with a government in whom they don't have a great deal of confidence and trust, then I realize that stranger things can happen and given the lack of confidence of private enterprise in this government, then I'm worried for the consequenc es in the future. Well, Mr.

Chairman, if there's not going to be a response from the Minister, I guess we'll have to conclude that he doesn't care to discuss the matter with the Federal Minister, who will have jurisdiction over whether or not this licence is transferred, and he doesn't care to look into it deeply enough to assure himself of how the operation might survive in Winnipeg and to what extent.

I know this - that this sale will give a very golden opportunity for rationalization and removal of some significant administrative functions from Winnipeg and unless there are some commitments that the Minister can enu nciate and state with confidence, the long-term prospect for continued numbers of staff remaining in Winnipeg after the rationalization, can't be very good and I know that those conc er ns are shared by emp loyees at the Monarch Life. HON. J. BUCKLASCHUK: Yes, I'd like to respond. First of all, I would like to indicate that I am taking Mr. 906 Thompson at his word.

I have no reason to doubt the commitment that he's given us and if the Member for Tuxedo feels that we should be doing cartwheels, in the meantime, when we have a commitment, well that's his opinion. Secondly, the permission for the contract has been granted by the Honourable Paul Cosgrove, Minister of State for Finance. I fail to see how our writing him a letter or contacting him, expressing our concern about Monarch Life, would alter things.

The purchase is su bject to the approval by policyholders and if the Member for Tuxedo is suggesting that Ministers of this government should get involved in the private sector and vetoing sales of companies, while at the same time we're recei ving commitments that there will be no negative impact on the province, I suppose he can hold that opinion. MR. G. FILMON: Mr. Chairman, I wasn't suggesting that this Minister or any mem bers of his government do cartwheels over anything.

In fact, I'm sure that none of them are capable of doing that - certainly the Minister of Economic Development, in her current state, is not capable of doing cartwheels. She was, in her day as a cheerleade r, I understand, but those days are long gone for both the Minister and myself. He says that he fails to see how contacting the Federal Government is likely to have any effect in vetoing the sale.

It seems to me that if the Minister is concerned with maintaining a large corporate emp loyer in Manitoba, there would be justifiable action on his part, to at least make an inquiry, to see whether or not the Federal Minister shares any of his concerns. The Federal Minister, of course, comes from Toronto, which is the headq uarters of the company that it's buying out and maybe he's quite happy to have that sale take place. But it seems to me that the Manitoba Government should have a different perspective and a different view on the whole thing. I believe Mr.

Thompson to be an excellent corporate citizen and a man of his word, but the Minister has indicated that the commitment has no time frame and it may well be that there will be other people involved in the corporation at other times in future who will have different views on it. So, I see the commitment as being without any particular term and I see the commitment as being not necessarily one on which Manitoba can bank and I also see this Minister and his government acting in different ways under different circumstances.

There are many times when they have gone running to both the Federal Government and/or corporations demanding that they take action to protect jobs in Manitoba and in this one, they seem to be strangely silent and I'm jus t pointing out the dif ference in approach and I just wonder why. HON. J. BUCKLASCHUK: Well, again I will respond that I think we share the member's opinion of Mr. Thompson as a fine corporate citizen. We have his commitment; we have every reason to beli eve that he will follow through with his commitment.

I might also mention that I have a copy of a letter here from the president of North American Life, Mr. Mccaug hey, I belie ve, and he states, "It is important to stress our commitment to keeping a major base of operations in

Monday, 21 March, 1983 Winnipeg and to maintain an active presence and continuity of emplo yment in your city." Now, when you have the very top executive officer within No rth American Life giving that type of commitment; when you have the senior executive officer within Monarch Life giving us the commitment; we will take them at their word. If things should change, then we will deal with the situation at that time. MR. CHAIRMAN: 3.(b)( 1) -p ass; 3.(b)(2)- pass; 3. (c)(1) - the Member for Tuxedo. MR. G. FILMON: Mr.

Chairman, I wanted to ask the Minister, and I had mentioned it earlier in the discussion about - I suppose the status of his department's involvement with the Falcon Lake Resort and Club to beg in with, and allying to that, the status of the legislation which was under preparation when our government left office that would presumably work to protect investors in time-sharing ventures? HON. J. BUCKLASCHUK: First of all, I'll respond to where the Captran situation is at.

As the Member for Tuxedo is no doubt aware, court action appointing a trustee was brought by the Canadian Imperial Bank of Comme rce to protect its interest, I belie ve about two weeks ago. This court action was also brought to protect the interests of a number of lien holders who have claims under The Builders Liens Act. Another point that should be known is that the Manitoba Securities Com mission, at a meeting of January 27th, 19 83, halted further sales of time-share units until appropriate insu rance had been reinstated and the offering document updated by Captran to reflect the current financial position.

There had been no new sales of time-share units for some weeks prior to the action on the part of the Securities Commission and the bank had been enga ged in assessing its position relative to its loan before the commission took this step. The trustee has been appointed by the court. He has sent notices to all unit holders convening a meeting and he's making every effort to ensure that their interests will be recogn ized by any new purcha ser. I believe that meeting with the creditors was held last Friday.

The problem tha t the Falcon Lake project is experiencing stems from its inability to sell enough time­ share units to make the project safely viable and I should also mention that the Securities Commission ordered a freeze order in the latter part of February to protect unit holders' trust funds and the trustee is now in a position to safeg uard those trust funds.

With respect to where we're at with the time-share legislation, a new time-share regulatory scheme has been under considera tion but such a new regulatory apparatus, if it is to expand to fully comprehensive proportions, will entail a not insignificant increase in gover nment spending. As the member is aware, it's the desire to hold down unessential spending, and this has been a main factor in postponing the new legislation required.

One should also bear in mind that a considerable proportion of these time-sharing schemes are already covered to some extent at least, by the Securities 907 Commission under The Securities Act or under The Real Estate Brokers Act. I should also mention that the only province that has time-sharing legislation in place at the present time is Alberta. MR. G. FILMON: Mr. Chairman, I recall that we had sent staff members to Alberta to go over with the Alberta counterparts the legislation which they have in place.

Can the Minister indicate to me what would be the es timated annual cost of having appropriate legislation in place to govern these time-sharing agreements? HON. J. BUCKLASCHUK: I'm informed that the minimum would be in the neighbourhood of $50,000.00. MR. G. FILMON: How would that compare to the costs of having say travel agency protection legislation protection for those who deposit money on travel? HON. J. BUCKLASCHUK: I belie ve I'd indicated the figure last week, would be in the neighbourhood of $200,000 as a minimum. MR. G.

FILMON: And the government has other priorities that it feels are more appropriate for this money, like sponsoring Marxist Conferences at the University . . . MS. M. PHILLIPS: Good try, Gary, good try. MR. G. FILMON: It would go a ways towards the 50,000; I think if you give me enough time I'll find the other appropriate ones to cover 50,000.00. A MEMBER: Good luck to you! MR. G.

FILMON: Well, I'm suggesting that if there is a risk there for investors that the government should be considering legislation that would minimize or make it much more difficult for people to be attracting investors without proper information, without proper protection for them. - (Interjection) - MR. CHAIRMAN: Does the Member for Tuxedo have any questions? MR. G. FILMON: Mr. Chairman, I'm sorry. I am being interrupted by the Member for lnkster who is cross­ examining me across the table here.

So I'll go on to the question that I wanted to ask, and that is, the Minister said that various types of transactions are covered by The Real Estate Brokers Act and The Securities Commission Act, which types of transactions, with respect to time-sharing situations, are not covered? HON. J. BUCKLASCHUK: I was informed that there may be some issues in time-sharing that sort of fall between the cracks that are not covered under The Securities Act or under The Real Estate Brokers Act. MR. G. FILMON: Mr. Chairman, if a Manitoban invests in time-sharing property outside the province or outside

Monday, 21 March, 1983 the country, is there anything within Manitoba legislation that protects his interests? HON. J. BUCKLASCHUK: I'm informe d that the contract is outside the province, and we do not have any jurisdiction. MR. G. FILMON: But if the property, or the share of the property , is being mar keted in Manitoba, Manitobans are covered? HON. J. BUCKLASCHUK: I'm informed that under The Real Estate Brokers Act that transaction would be covered if that selling is taking place within the province. MR. G.

FILMON: Conversely , if a non-Manitoban buys a share in a time-share property in Manitoba and the purchase is made outside the province, is he currently covered by anything in Manitoba legislation? HON. J. BUCKLASCHUK: Yes. MR. CHAIRMAN: Would the Member for Tuxedo repeat the question? MR. G. FILMON: Let's say a person who is an investor in British Columbia or Saskatchewan, which doesn't have time-share legislation, were to purchase an interest in a time-share property in Manitoba, the purchase having being made in Saskatchewan, would he be covered by anything in Manitoba legislation? HON. J.

BUCKLASCHUK: I'm informed that if the person selling the real estate interest, if that transaction takes place within Manitoba, then that is subject to Manitoba regulati on. but if it's done outside of the province, we have no extra-provincial jurisdiction. MR. G. FILMON: How long will it be before the Minister foresees his government bringing forth this kind of legislation? HON. J. BUCKLASCHUK: That depends entirely upon our ability to obtain some funds for the extra staffing that's required. MR. G. FILMON: Mr.

Chairman, I wonder if I can ask the Minister what is the current status of the Winnipeg Mortgage Exchange situation in Manitoba. HON. J. BUCKLASCHUK: I unde rstand, from a letter I saw a few days ago, that the first payout is being made to the investors at, I believe, 65 percent on the dollar, 65 cents on the dollar. There are additional assets under administration and further payouts will be made when the assets are liquidated. MR. G. FILMON: I wonder if the Minister can indicate to me if he or his government have fired any of the former members of the Securities Commission in the past year. HON. J.

BUCKLASCHUK: I am informed that there have been no persons removed from the Securities Commission. I believe there has been one new addition. 908 MR. G. FILMON: Mr. Carson? HON. J. BUCKLASCHUK: That is correct. MR. G. FILMON: Have there been any additions to the staff of the Securities Comm ission in the past year or are there any contemplated for this year? HON. J. BUCKLASCHUK: Yes, as you'll note from Page 28 of the Supp lements, the number of SY's for 1983- 84 is the same as last year's figure of 22.0. We may be adding one additional staff person.

We have a submi ssion into Treasury Board; that is yet to be determined whether that position will be filled. MR. G. FILMON: What were the responsibilities of the additional position intended to be? HON. J. BUCKLASCHUK: Yes, that position will be an Assistant Legal Counsel. MR. G. FILMON: Have there been any difficulties with respect to licencing and regulation of real estate dealers, brokers and salespeople? HON. J. BUCKLASCHUK: I'm informed that there has been nothing out of the normal in terms of the normal level of complaints. MR. G.

FILMON: I had a situation brought to my attention by an individual who went through and became licenced as a real estate salesperson and owned another busi ness on the side in which he, I guess, spent part of his time, and he was informed by, I guess it would be, the Real Estate Association that he could not continue to be actively involved in that other busi ness and continue to be licenced as a real estate salesperson. Is that the Minister's unde rstanding and is that a legislative mandate? HON. J.

BUCK LASCHUK: It is not a legis lativ e mandate, and I believe you had said that this had come about as a result of a decision of the Winnipeg Real Estate Associa tion. MR. G. FILMON: Does the Minister agree with that practice? HON. J. BUCKLASCHUK: I would have to study the circumstances of this particular situation. This is the first information I've had on this. MR. G. FILMON: As I understand it, the circu mstances are that if you're licenced as a real estate salesperson, you cannot be employed in any other endeavour on a full or part-time basis. HON. J.

BUCKLASCHUK: I understand that this is a rule of the Winnipeg Real Estate Board and I don't know whether it would be appropria te for me to comment on that or not. The board is made up of members from the profession and it's a voluntary association. MR. CHAIRMAN: The Member for Radisson.

Monday, 21 March, 1983 MR. G. LECUYER: In view of this question, I would like to ask the Minister if there has been changes or if this has been the current and existing practice all along? HON. J. BUCKLASCHUK: I'm informed it's an existing practice for a number of years. MR. G. FILMON: Mr. Chairman, the Minister says that it's a voluntary associ ation, does that mean that people can sell real estate without being members of the Winnipeg Real Estate Board? HON. J. BUCKLASCHUK: Yes, they can. MR. G.

FILMON: In view of the fact that restrictive trade practices, in essence, come under this Minister as Minister of Consumer and Corporate Affairs, if people who are qualified and licenced to do something are restricted from being emp loyed in that area by virtue of other conditions such as this of a voluntary associ ation, would this not be considered a restrictive trade practice? HON. J. BUCKLASCHUK: I und erstand that the Winnipeg Real Estate Board is a voluntary organization.

There is no compu lsory reason why a member would have to belong to that board, and therefore I don't see how his activities would be prohibited. MR. G. FILMON: Can a person sell real estate if he doesn't work for a broker? HON. J. BUCKLASCHUK: A real estate agent has to be emplo yed by a broker. MR. G. FILMON: The Minister is anticipating my question. If the majority of the brokers are members of that associa tion, then wouldn't that mean that it would be difficult for the person to be gainfully employed as a salesman if most of the brokers are members of that association and he has to work for one of them? HON.

J. BUCKLASCHUK: Again, it's a matter of choice who one wishes to work for. I am informed that quite a number of brokers are not members of the Winnipeg Real Estate Board and therefore wouldn't prohibit that person from being actively involved in the prof ess ion. MR. CHAIRMAN: 3.(c )(1) - pass; 3.(c)(2) -pa ss? - the Member for Tuxedo. MR. G. FILMON: Mr. Chairman, I'm sorry, I was just going to ask under Other Expenditures what's generally covered in that. HON. J. BUCKLASCHUK: Under Other Expenditures? The figure that you have is $68,600.00.

This involves professional fees, other fees, office furnishings and equipment, printing and stationery suppl ies, and there's a complete breakdown. You have it on Page 28 in your Supplement. MR. G. FILMON: Okay. Pass, Mr. Chairman. 909 MR. CHAIRMAN: 3.(c)(2)- pass; 3.( d)(1)-p ass? - the Member for Tuxedo. MR. G. FILMON: Mr. Chairman. I was just waiting for other staff to come, but perhaps there aren't any additional staff? MR. CHAIRMAN: The Honorable Member for Lakeside. MR. H. ENNS: Thank you, Mr. Chairman.

I notice that this is one of the few appropriations perhaps, as we go through the whole book, where we show an actual reduc tion. My question is of a general one. It would appear that there has been no indication to him to perhaps expand the operations of the board to include the regulation of future telecommunication services in the provinces.

I, by way of backg round, sim ply ind icate to him I'm well aware tha t this government has not proclaimed a certain legislation that foresaw the need for the Public Utilities Board to play a substantially larger role in the coming services which could involve pay television, extra services, a lot of them which would involve the Manitoba Telephone Systems network.

I don't fault the Minister for not being aware, because I don't think he was in the House when the previous administration, in fact, passed legislation that designated the Public Utilites Board to play a substantive role in the regulation of these coming modern communication services. I just ask the general question to the Minister, through you, Mr. Chairman, that with the no change in the status of the board in terms of salaries and other expenditure, indeed with some nominal decreases shown, can he confirm that the Public Utilities Board has not been instructed to gear up for that role?

Should that Act be proclaimed by the gove rnment, the Public Utilities Board would have a whole host of new responsi bilities in sorting out some of the obvious problem areas, the setting of rates between the monopolistic present cable carriers, as well as the introduction of new services, communication services, that was envisaged, perhaps somewhat optimistically, a few years ago when we talked about the, you know, the electronic city concept, Telidon, etc. etc., much of that having to do with the using the network of the Manitoba Telephone System which, of course, is regula ted regularly by this board.

If, in fact, that was the gove rnment's intention, this board would find itself with a lot more work to do and a considerably expanded role, you know, of expertise, staff, and time would have to be allocated to it. I'm simply asking the Minister, perhaps somewhat through the back door, whether or not he has received any information from his government that that role may still be forseen as an appropriate one for the Public Utilities Board to be part of? HON. J. BUCKLASCHUK: Yes, in answer to the comments made by the Member for Lakeside. My unde rstanding is that Bill No. 10 7 was passed a number of years ago.

It has not been proclaimed, nor do I have any indication at the present time that there's any intention of proclaiming it in the immediate future. Reference was made to the small increase or a decrease in expenditure in Estimates for this sec tion. Part of the reason for the decrease was that in last

Monday, 21 March, 1983 year's Estimates there had been a provision made for a vice-c hai rman, an associate secret ary, and an administrative secretary as part of this Bill 107 package. We took that out of the Estimates this year fe eling that if there was need in the telecommunications area to be done by the Public Utilities Board, this could be done by using consultants. MR. H. ENNS: Well, Mr.

Chairman, then perhaps just to ascertain the Minister's personal feel ings about the future role that the Public Utilities Board could play in this area, would he not confirm that this is the appropriate board that should, as envisaged in Bill 10 7, though unproclaimed, be the board to regulate that important aspect of our future communication systems, bearing in mind that we have in the City of Winnipeg basically provided for two monopoly private carriers that provide our current cable services, who I'm told are anxious to get on with providing a host of other services to the people of the City of Winnipeg.

I take it that this government's attitude would be similar to the previous government's attitude that under those circumstances a board such as this should be prepared, both from the point of staff and funds, to adequa tely protect the consumer interest as these new services come on line, and particularly, in the provision of these new services, where they have to, in some instances, share the facilities of another public utility; namely, the Manitoba Telephone System.

It's in that whole question of what is, you know, an appropriate price, what are appropriate service charges for these services. and how can, on the one hand, the people of Manitoba through the vehicle of the Manitoba Telephone System receive a fair share of the anticipated new revenues. I belie ve the Manitoba Telephone System has consistently indicated that there only hope of keeping basic communication services available to Manitobans at reasonable levels, is that they get an opportunity to share in some of the new revenues that are generated from these new sources.

It was for those reasons that a previous administration passed Bill 10 7, to set the stage for the introduction of these new services. I would urge the Minister to keep Bill 10 7 in mind. I appreciate that it's not his immediate re sponsi bi lity to either push or pr omote for its proclamation, but if the bill should be proclaimed, then the Public Utilities Board will have a lot more work on its table and he may well be asking for some additional fund to carry out that resp onsibil ity. HON. J.

BUCKLASCHUK: Well, with respect to whether or not the Public Utilities Board could deal with the problem inv olved with tele commun ications, I'm inf orme d that the PUB at the present time does adjud icate cable rates as directed by Cabinet. There would have to be a question as to whether it would be financially defen sible to set up a bureaucracy to deal with what I would consider at this time to be an unknown quantity.

Certainly there will be issues arising in the future, but whether we would want to set up a bureaucracy of $10 0,000 or $1 50,000, $200,000 to deal with a quantity that, at the present time, we can't gauge would be questionable. It may well be that it might be a better way to deal through the present arrangement 910 with the Public Utilitie s Board and to obtain the assistance of consultants to deal with the issue at that time. MR. CHAIRMAN: The Member for Lakeside. MR. H. ENNS: Mr. Chairman, let there be no misunderstanding. There is no question of setting up an additional bureaucracy to look into that.

It seemed to be very natural that the Public Utilities Board be the body to be involved in whatever kind of regulation may be required in the future. It would be the natural thing to acknowledge though that, with a new and expanded area of res ponsibil ity, the Board would have to be supported. However, I won't press the matter.

The issue is one that I intend to take up with the Minister responsible for Manitoba Telephones more directly as to what the future of Bill 10 7 is, but I just raise the matter here because I note that obviously, from the figu res in this appropriation, there is no anticipation of future activity by the Public Utilities Board in this sector. Thank you, Mr. Chairman. MR. CHAIRMAN: The time being 4:30 p.m., time for Pri vate Mem bers' Hour , I am interru pting the proceedings until 8:00 o'clock this ev ening. SUPPLY - AGRICULTURE MR. CHAIRMAN, P. Eyler: Committee come to order.

We are considering the Estimates of the Department of Agricultur e. The last time we met we had skipped over Item 1. (c)(1) which is Communications Branch: Salaries. Is it the will of the committee to go back and pick up the one that was omitted or to continue from 1. (d)(2)? Mr. Minister. HON. B. URUSKI: Mr. Chair man; first of all, I must apolog ize to the honourable members for my delay this afternoon.

I can only say that the meeting I attended in Oak Bluff, I was unable to get away as early as I thought, and I owe the honour able members of the committee and of this House an apology for that and I give that to them directly. HON. L. DESJARDINS: Buy a drink for the crowd, that will be all right. HON. B. URUSKI: That might be considered after the Estimates are through. Mr. Chairman, some of the questions that were raised with respect to Item 8, 1. (c)(1) with respect to the salary que stion within the Commun ications Branch, the increase over the '82-83 vote was $95.1 thousand or approxi mately 25 percent.

The '8 2-83 negotiated increase is $39,000; the '83-84 negotiated increase is $39.7 thousand; and the 27th pay period is $16 .4 thousan d, making the amount $95. 1 thousand as covering that increase. None of the general salary increase in '8 2-83 of 99 1 was allo cated to the Commun ications Branch because they didn't need it at the time, I'm advised. MR. CHAIRMAN: The Member for Arthur.

Monday, 21 March, 1983 MR. J. DOWNEY: Mr. Chairman, the opposition, I'm sure, unde rstand that when a Minister is delayed - when we as Ministers had to ask for accommodation by the opposition when we were on that side of the House - and do accept the apol ogy. However, I would wonder why his House Leader would not show him the courtesy or at least co-ordinate efforts and have called another item until he got back.

I think there could have been certainly some leadership shown or at least some co­ operation shown within their own Treasury Bench, and of course they're running the government and the province like they're running the committee hearings, Mr. Chairman. As we ll, Mr. Chairman, I ha ve a har d time understanding that the Minister of Agriculture attended this particular meeting today, which was sponsored by the National Farmers Union dealing with the Crow rate issue, when the Minister of Transport has been carrying that particular res ponsibility within their government.

I would hope at some point in the next day or two, there would be a full explanation from the Premier or the House Leader of the government explaining why that particular situation developed in view of the fact that the Minister of Agriculture's Estimates were before this Assemb ly.

Although seeing that he was there, unable to get back, I can appreciate the difficulty that he had in that regard, but that doesn't excuse the fact that his House Leader and that government were unable to co-ordina te themselv es so tha t they could accommodate all members of this House and keep on with the busi ness that is so important to the people of Manitoba. It has to be put on the record, Mr. Chairman. The Minister, in his explanation for the Commu nications Branch salary increases has, I gue ss, been answered and it'll take me a little bit of time to check it on the record what he has said.

However, there were some other questions dealing with staff and I would have hoped that the Minister would have had a list of those people who have been newly emplo yed, those people who were both term position, permanent civil servants and contract people who have been relieved from their jobs or added to the agricultural staff. That was another question that I had. I'll leave the specific increase in wages. My colleague may have some comments, but at this time I will reserve those until a later date. MR. CHAIRMAN: Mr. Minister. HON. B. URUSKI: Mr.

Chairman, we didn't pass, I don't believ e - yes, Thu rsday, we did not conclude. There is some information under the Manitoba Natural Products Marketing Council that I have for the members. When we come back, I'll give them that - give the Honourable Member for Morris those answers. With respect to the questions of contract and those, we will have tha t information tomorro w for the honourable member on the entire department. MR. CHAIRMAN: The Member for Pembina. MR. D. ORCHARD: Mr.

Chairman, I just want to get a few more detai ls from the Minis ter on his rationalization of a $95,000 or a 25 percent wage 911 increase in the Communications Branch. First of all, am I correct in assuming that there was no reconciliation in the left-hand column of the General Salary Increase? There was no allocation of the General Salary Increase to the Commu nications Branch? HON. B. URUSKI: That is correct. MR. D. ORCHARD: And the reason was that they didn't need it? Did they not get a raise last year, Mr. Chairman? HON. B. URUSKI: Mr.

Chairman, there were vacancies within the branch and there were vacant positions that didn't require the budg etary amount that was voted initially to cover off any funds that would have gone with the increase. They received the same increase in the same negotiated increase , but because of vacancies and positions that are in place, staff years that are in place, the full amount of any monies from the 991 did not have to be allocated directly to the branch. MR. D.

ORCHARD: The Minister indicated that there was a $39,000 figure which represented the fiscal year '82-83 raise; a $39.7 thousand figure which was the projected '83-84 raise; rough calculations would indicate tha t the 39,0 00 would be some wher e in the neighbourhood of 10. 5 percent, fiscal year '83-84. It was my un derst anding that the first year of the settlement was in excess of 12 percent. Would that not be correct, Mr. Chairman? HON. B. URUSKI: In the branch, Mr. Chairman, the average increase, the $39,000 for the '82-83 average increase is 10. 3 percent. MR. D.

ORCHARD: That seems to be somewhat less than the contract settlement by the Manitoba Government Employees Asso ciation. I belie ve it was somewhere in the neighbourhood of 12 .5 percent. The second question is, Mr. Chairman, the Minister, in his answers of Thu rsday evening last week, indicated that there would be three components making up the 95,000, namely, the unallocated salary increase from '82-83; the salary increase for '83-84, plus increments.

Where does the Minister show in here increments which - are we to assume that no one in the Communications Department received an increment which, generally I think by average calculation, adds 1. 5 percent to the salary package as an average throughout a Jepartment. We are given here a 10.3 percent increase which, No. 1, does not reflect the full value of the first year settlement of the MGEA contract, nor does it reflect any increments which one would assume at least a portion of the staff in the Communications Branch would have received.

That same problem exists in the 39.7 thousand that, theoretically, is the wage increase outside of the 27th pay period for fiscal year 19 83-84. Are we to assume tha t no perso nnel in Commun ications received increments last year and that they are not going to receive increments this year, or do we assume that the increments are going to be provided as an additional Supp lementary Supply at some later date so that the Minister has unde restimated his salary costs in all these departments?

Monday, 21 March, 1983 HO N. B. URUSKI: Mr. Chairman, what I have provided for the honourable member was the global amount of money that was included in the increases. What the mem ber didn't speak about and is part of that figure and I gave it to him was the 27th pay period . MR. D. ORCHARD: Yes, I did. HON. B. URUSKI: ... which was $16 .4 thousand.

The honour able member should understand that, in terms of the merit increases, they are included within the amount of money that we have in here and, because of the vacant positions in the branch and the varying salary ranges and classificat ions that staff are in - when one talks about averages, while they vary because you have some out-o f-scope or higher amoun ts, the increase, I believe, in 198 2-83 was an average of 10 percent plus $600.00. It would have taken varying percentages, depending on the classification and the staff level that individual is in.

In terms of dollar terms, it may have increased more for those at the higher level, but what I've done is given the honourable member global amounts. Insofar as to whether we will require any further amounts of money in terms of this year, I am advised that there will not be any additional funds required in terms of the present contract, in terms of merits and the total salary component this year. MR. D. ORCHARD: Mr. Chairman, I am going to finish with this remark.

The Minister has given us a 10 .3 percent figure as being all that was requir ed to bring the salary settlement for fiscal year 1982-83 to comply with the 10 percent plus $600, plus the merit. Now all figures given by his colleagues, the Minister of Finance and the Minister of Labour, when they were talking about the MGEA settlement was that departments would average approximately 12 percent increase in wages.

The general figure that is always bounced around as being an average for the merit increments is 1. 5 percent on top of that, which would mean that we should see something in the neighbourhood of a 13 .5 percent increase in salary for fiscal 198 2-83. The Minister has got it down at 10 .3 percent.

Now that may well be the case, but I suggest the problem gets a little more tenuous when we r,onsider that the Minister is giving us a $39.7 thousand increase, being sufficient to cover the second year of the MGEA contract plus increments, and that settlement comes out to be somewhere in the neighbourhood of - it would have to be somewhere between 9 percent and 9.5 percent on a percentage basis, where we know that the MGEA settlement is 10 .3 percent. Merit increases of 1. 5 percent would bring us close to 12 percent, but yet the Minister has us believing that it's underbud geted by some 3 percent.

I simply ask the question again, can the Minister assure us that he is not going to be going back to the Cabinet table and to Treasury Board after the Session finishes to have a Supp lementary Supply passed to cover approximately a 2.5 percent to 3 percent salary shor tfall. We have made the allegation in the Budget Debate that the Minister of Finance has, once again, underestimated his expenditures in the government for the fiscal year, 198 3-84. It would seem here clearly, 912 that this Minister has under estimated his salary costs.

They don't reflect the current settlement plus increments that all members of the Treasury Bench are indicating. If he is coming back for Supp. Supply, so be it, but we would like to get that indication from him now so that we can have a better idea in each department how much more money this Minister is going to require to pay salaries. MR. CHAIRMAN: The Minister of Finance. HON. V. SCHROEDER: Mr. Chairman, I have been listening with a little bit of amazement to the Member for Pembina. His arguments certainly don't accord with the facts, but that's not strange for him .. MR. D. ORCHARD: Give us the facts, then.

HON. V. SCHROEDER: . . . he starts off by saying, the numbers are too high. He ends off by saying, they are too low, and what brings me into the debate is the matter of somehow misjudging numbers for last year because that is beginning to annoy me. The facts, Mr. Chairman, are very clear. Under the previous government, when the Member for Turtle Mountain was Finance Minister, there was a much larger discrepancy between what they said they were going to spend and what they did spend than what happened last year.

I remind the Member for Pem bina that last year, we had Special Warrants, for instance, in the area of $45 million. When you people were in government, in your last year, you had $105 million in Special Warrants which were items which you go ahead and spend beyond what this Legislature had approved .

Last year we had, as far as our latest projections are concerned and I've handed out the December report, the Quarterly Financial Report of the Province of Manitoba to De cember of 19 82, and I would recommend to the Member for Pembina that he spend some time reading that document because it deals with projections and what actually happened. Mr. Chairman, if we look at the Statement of Expenditures for the first nine months of the year, because that's what we can only deal with for last year, and I refer to Page 3 of that document.

For 19 8 1-82, the year the Tories were in gover nment, there was a projected figure of $1 .832 billion, actual $2. 15 0, in crease 317 million. The next year, 19 82-83, expenditures 2.15 0 . . . MR. A. ANSTETT: Mr. Chairman, on a point of order. HON. V. SCHROEDER: Mr. Chairman, I am dealing with the matter that was raised by the Member for Pembina. MR. CHAIRMAN: Order please. The Mem ber for Springfield on a point of order. MR. A. ANSTETT: Mr. Chairman, I didn't catch everything the Member fur Pembina and the Member for Arthur said.

I know the y were talking about Communications within the Department of Agricultur e, but I think, with respect to the Minister of Finance, he's talking about the overall fina ncial position and

Monday, 21 March, 1983 expenditures of the province and we're going to get into a precedent here for a cover-the-waterfront debate by the Minister of Finance which I am not sure is in the best interests of getting the Estimates of Agriculture pass ed . A MEMBER: For once, you're right, Andy. MR. CHAIRMAN: The Minister of Finance. HON. V. SCHROEDER: Mr. Chairman, I can assure the Member for Springfield that the item I am referring to includ es information within the Department of Agriculture.

That was part of the spending for the first nine months and it was part of what the Member for Pembina was referr ing to, but I certainly do thank the member. As a result of his intervention I will try to keep my remarks, with respect to information in agriculture, short. Mr. Chairman, I want to emp hasize the fact that our spending for last year was much much closer to our original projections than what it was in 19 8 1- 82. That was the issue raised by the Member for Pembina.

That is the issue that I now wish to respond to because it is untrue and I wish the member would stop referring to it because he should hims elf know that it's untrue and he can refer to the documents that prove it. MR. CHAIRMAN: The Member for Pembina. MR. D. ORCHARD: Thank you, Mr. Chairman. Could the Minister of Agriculture indicate what percentage of increase the $39. 7 thousand on salaries for fiscal year 19 83-84 represents and does that percentage include merit increments? HON. B. URUSKI: Mr.

Chairman, that amount of the $39.7 thousand, on an average 9.5 percent in terms of negotia ted increase will includ e, in the total complement of staff within the branch monies to cover increments primarily because there are vacancies within the branch and if those vacancies are not covered we do not anticipate in requesting any further funds this coming year as far as salaries or any other salary increments. MR. CHAIRMAN: The Member for Lakeside. MR. H. ENNS: Mr.

Chairman, I'd like to talk just generally for a moment or two about the Commu nications Branch and its requirement to inform, and I do so because the New Democratic Government from time to time has had difficulty in distinguishing between the responsi bility that a government has from time to time, or in this case the Depart ment of Agriculture and the Minister of Agriculture has to inform the rural people, the farm people of Manitoba about the various programs that he is charged with the resp onsibility administrating and seeing to it that the farmers understand them, that they have access to them and that communication is indeed appropriate.

Allow me, Mr. Chairman, to quote from the Weppler Report on Commun ications which points out that governments are different. The things they do, the way in which they do them, the decisions they make, the 913 services they provide affect the way we live in a very basic way. People actually need the information that governments generate and gover nme nts have an obligation, freely and constantly stated, to make it available to them. Now, you can transla te that in this case, the Department of Agricultur e has that obligation.

The farmers have a right, the rural people have a right to kno w the kind of programs tha t the Exten sion Department is providing, the kind of programs that the 4-H Department is providing and so forth. I'm assuming and I make that as a general state ment as the resp onsibilities that come under the Commun ications Branch in providing that kind of basic information to the farmers of Manitoba, Mr.

Chairman, what is not an appropriate use of this branch is to use particular points of view that are held by the New Democrats or by, let's say, the National Farmers Union from time to time and then use this branch and to use public money for the spread ing of that kind of information. Now, Mr. Chairman, I'm cautioning this Minister who's relatively early in his career as Minister of Agriculture in this government, but I remind him, that wasn't always the case.

In the previous NDP administration we all of a sudden fou nd extensive public monies used to promote, for instance, very specific points of view that they held as a party, for instance, that rapeseed should come under the direct control of the Canadian Wheat Board. Now, Mr. Chairman, that may or may not be the case. Farmers have different points of view on that out in rural Manitoba. But it is not an issue, it's a political position that I have no objection to if the New Democrats want to take that. I do object when monies are expended under this appropriation for that kind of purpose. Mr.

Chairman, the same thing can be said about the kind of moni es that were expended by the New Democrats with respect to a position that they held on the Crow and they printed very fancy publ ications, they took out ads in the farm papers and, Mr. Chairman, the issue of the Crow is a very complicated one. There is not unanimity, obviousl y, in rural Manitoba and until there is unanimity - (Interjection) - unanimity was created