Manitoba Hansard — 27 March 1997 (Sitting 19, 36th Legislature, 3rd Session)

36-3-19

Manitoba — Debates (Hansard)

Third Session- Thirty-Sixth Legislature of the Legislative Assembly of Manitoba DEBATES and PROCEEDINGS Official Report (Hansard) Published under the authority of The Honourable Louise M. Dacquay Speaker Vol. XLVII No. 19-10 a.m., Thursday, March 27, 1997

MANITOBA LEGISLATIVE ASSEMB LY Thirty-sixth Legislature Member CODStitueocy Political Aftiliation ASHTON, Steve Thompson N.D.P. BARRETI, Becky Wellington N.D.P. CERILLI, Marianne Radisson N.D.P. CHOMIAK, Dave Kildonan N.D.P. CUMMINGS, Glen, Hon. Ste. Rose P.C. DACQUA Y, Louise, Hon. Seine River P.C. DERKACH, Leonard, Hon. Rob lin-Russell P.C. DEWAR, Gregory Selkirk N.D.P. DOER, Gary Concordia N.D.P. DOWNEY, James, Hon. Anhur- Virden P.C. DRIEDGER, Albert Steinbach P.C. DYCK, Peter Pembina P.C. ENNS, Harry, Hon. Lakeside P.C. ERNST, Jim Charleswood P.C. - EVANS, Clif Interlake N.D.P. EVANS, Leonard S.

Brandon East N.D.P. FILMON, Gary, Hon. Tuxedo P.C. FINDLAY, Glen, Hon. Springfield P.C. FRIESEN, Jean Wolseley N.D.P. GAUDRY, Neil St. Boniface Lib. GILLESHAMMER, Harold, Hon. Minnedosa P.C. HELWER, Edward Gimli P.C. HICKES, George Point Douglas N.D.P. JENNISSEN, Gerard Flin Flon N.D.P. KOWALSKI, Gary The Maples Lib. LAMOUREUX, Kevin Inkster Lib. LATHLIN, Oscar The Pas N.D.P. LAURENDEAU, Marcel St. Norbert P.C. MACKINTOSH, Gord St. Johns N.D.P. MALOWAY, Jim Elmwood N.D.P. MARTINDALE, Doug Burrows N.D.P. McALPINE, Gerry Sturgeon Creek P.C. McCRAE, James, Hon. Brandon West P.C.

McGIFFORD, Diane Osborne N.D.P. - MciNTOSH, Linda, Hon. Assiniboia P.C. MIHYCHUK, MaryAnn St. James N.D.P. MITCHELSON, Bonnie, Hon. River East P.C. NEWMAN, David, Hon. Riel P.C. PALLISTER, Brian Portage Ia Prairie P.C. PENNER, Jack Emerson P.C. PITURA, Frank, Hon. Morris P.C. PRAZNIK, Darren, Hon. Lac du Bonnet P.C. RADCLIFFE, Mike, Hon. River Heights P.C. REID, Daryl Transcona N.D.P. REIMER, Jack, Hon. Niakwa P.C. RENDER, Shirley St. Vital P.C. ROBINSON, Eric Rupertsland N.D.P. ROCAN, Denis Gladstone P.C. SALE, Tim CrescentWood N.D.P. SANTOS, Conrad Broadway N.D.P. STEFANSON, Eric, Hon. Kirkfield Park P.C.

STRUTHERS, Stan Daupbin N.D.P. SVEINSON, Ben La Verendrye P.C. TOEWS, Vic, Hon. Rossmere P.C. TWEED, Mervin Turtle Mountain P.C. VODREY, Rosemary, Hon. Fort Garry P.C. WOWCHUK, Rosano Swan River N.D.P.

915 LEGISLATIVE ASSEMBLY OF MANITOBA Thursday, March 27, 1997 The House met at 10 a.m. PRAYERS ROUTINE PROCEEDINGS PRESENTING PETITIONS Gang Action Plan Mr. Gord Mackintosh (St. Johns): I would like to present the petition of Debi Spence, Klaus Tibelius, Elmer Schartrand and others praying the Legislative Assembly of Manitoba urge the Minister of Justice to consider using this action plan, the NDP 18-point plan to deal with gang crime as a basis for provincial policy on organized criminal gangs.

READING AND RECEI VING PETITIONS Gang Action Plan Madam Speaker: I have reviewed the petition of the honourable member for St. Johns (Mr. Mackintosh). It complies with the rules and practices of the House. Is it the will of the House to have the petition read? An Honourable Member: Yes. Madam Speaker: Yes. The Clerk will read. Mr.

Clerk (William Remnant): The petition of the undersigned citizens of the province of Manitoba humbly sheweth: THAT the increase in violent crimes in Manitoba since 1990 has been more than three times as much as the Canadian average; and THAT crime can only be effectively dealt with through both prevention and suppression; and THAT the tough talk of the Manitoba Justice minister has not been matched with action; and THAT Manitobans want a positive, comprehensive response to crime and gang crime that provides alternatives for youth; and THAT the New Democratic Party has put forward an 18-point plan to deal with gang crime; and THAT this plan is divided into elements focused on both the justice system and families, schools and communities; and THAT this casted plan has been subject to widespread consultation and has been praised as a detailed plan to fight youth crime that is well thought through and constructive.

WHEREFORE YOUR PETITIONERS HUMBLY PRAY that the Legislative Assembly of Manitoba urge the Minister of Justice to consider using this action plan as a basis for provincial policy on organized criminal gangs. Introduction of Guests Madam Speaker: Prior to Oral Questions, I would like to draw the attention of all honourable members to the Speaker's gallery where we have this morning His Excellency George Bullen, High Commissioner for the Eastern Caribbean States. On behalf of all honourable members, I welcome you this morning.

Also seated in the public gallery, we have eight visitors from the Applied Linguistics Centre under the direction of Mrs. Ruth Klippenstein. This group is located in the constituency of the honourable member for St. James (Ms. Mihychuk). On behalf of all honourable members, I welcome you this morning. ORAL QUESTION PERIOD Labour-Market Training Federal-Provincial Agreement Mr. Gary Doer (Leader of the Opposition): Madam Speaker, my question is to the Premier. The

916 LEGISLATIVE ASSEMBLY OF MANITOBA March 27, 1997 Charlottetown Accord, which included a devolution of labour market training, was rejected by Manitobans in a referendum or plebiscite a few years ago. The provincial government has been negotiating with the federal government on the devolution of the human resources sections of manpower training. *

(1005) I would like to ask the Premier what mandate does he have to proceed to negotiate an agreement with the federal government from the people, first of all. Secondly, can he confirm that the cabinet of Manitoba has approved an agreement and the federal cabinet of Canada has also approved an agreement on devolution of power in this area? Hon. Gary Filmon (Premier): It is interesting the manner in which the member opposite phrased the question about the Charlottetown Accord, having been defeated or at least denied by the people of Manitoba.

The member opposite, as Leader of the New Democratic Party, and his party supported the Charlottetown Accord and all of the contents, including that devolution of labour authority. The whole process of events that has been carried out by federal and provincial governments ever since has been to try and disentangle responsibilities for delivery of various services in which there is clearly an overlap or a duplication between the federal government and the provinces. In good faith we have been working towards that disentanglement on a whole series of fronts-very up front about it.

I mean, they have been named constantly in discussions that I have had in First Ministers' meetings, in annual Premiers' conferences. It is not a surprise to anybody. In that context, cabinet gave a mandate to the minister responsible for labour market training, and we are getting very, very close to an agreement. I might say that this is the product of, I think, serious discussion, serious negotiation, but there has not to my knowledge been anything signed at this point. There is no question that we are working out a lot of the issues that could lead to a signing. Mr.

Doer: My question again is to the First Minister. In light of the commitment today to be up front on this issue, I would ask him to table the terms and references of the devolution agreement with the federal government. Can the Premier confirm that the devolution agreement is similar to the one negotiated by the provinces of Alberta and New Brunswick, which, unfortunately, the agreements between New Brunswick and Alberta include only a three-year commitment for support in terms of specific dollars?

They only include a three-year agreement which again raises the whole question of offloading of the federal government onto the provincial government in these vital federal areas of jurisdiction. Mr. Filmon: I do not think it would be in anybody's interest to table drafts that are for the purposes of negotiation. What I will say though is that we are all concerned about the possibility of federal governments, this or future federal governments, offloading responsibility on the provinces. I mean, it has been happening.

The responsibility for social services to aboriginals living off reserve has already been just dumped, offloaded by successive governments. The Mulroney government did it first, and we objected to that. It was carried on despite the fact that the Liberals criticized that. It has been carried on by the federal Liberal government of Prime Minister Chretien now, and that has cost us over $100 million as a province over the last number of years.

This is the kind of thing that we all have to be vigilant about, but in the end what we also have to be aware of is that we want to be able to create a Canada in which we serve the best interests of all Canadians, in which we do our best to eliminate overlap and duplication and make more efficient the delivery of services that are needed. We also know-and I know the member opposite accepted the argument, in fact, put forth the argument-that we have a greater knowledge of and awareness of our specific labour market demands here in this province. We know where the skill shortages are.

They do not know that in Ottawa, and a separate bureaucracy from Ottawa is not going to make it better for us to be able to train and develop our labour market to meet the skill shortages and the economic opportunities of our province. -

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 917 So I believe we are working on the right thing. I believe that progress is being made. I believe that in the end the goal will be, for the best interests of all Manitobans and all Canadians, to get out of this overlap and duplication that has evolved over more than a hundred years in our country. *

(1010) Mr. Doer: The Premier never answered the question on the three-year term, which was my specific question. We have been informed that the agreement has been approved by both cabinets but not signed, as the Premier has indicated. We, too, are concerned about what the impact will be on our local communities. Can the Premier confirm that the staff reductions from the federal government to the provincial government will be from 143 positions to 118?

Can the Premier inform this House what will the impact of those changes on human resource officers and training officers be on the communities of Thompson, Selkirk, Brandon, Portage, St. Boniface, Morden, Steinbach, Dauphin, Swan River, The Pas, Flin Flon and the Winnipeg offices? They, too, Madam Speaker, work at the grassroots with people in terms of resource training and development on the human resource side. Can the Premier please indicate to the House what are those specific impacts on this devolution of power agreement? Mr. Filmon: Madam Speaker, I do not have specific figures at my fingertips.

As I indicated, the agreement has not been signed, and obviously at such time as any agreement is made public, then there will be an opportunity for discussion of all the possible impacts, positive and perhaps negative, although I believe that it is a positive initiative and a positive agreement that will ultimately create better opportunities for labour market development for us as a province. Labour-Market Training Federal-Provincial Agreement Ms.

Jean Friesen (Wolseley): Madam Speaker, the government of Manitoba has, with no public discussion, no public input, in secrecy, behind closed doors, accepted the offload of the federal government in labour market training. Nova Scotia rejected it. Newfoundland negotiated a co-management agreement that is long term and it involves both parties. P.E.I. as well as the Yukon are also negotiating co-management agreements. I want to ask the Minister of Education why was she afraid of asking and listening to Manitobans on an issue of constitutional significance of jobs and of post secondary training. Hon.

Linda Mcintosh (Minister of Education and Training): Madam Speaker, the member is incorrect in implying that there was some fear attached to in camera negotiations that go on between federal and provincial jurisdictions across this country. I can assure the member that negotiations between the provinces and the federal government are being done bilaterally, province by province with the federal government, looking for solutions that are made to order for each particular province.

They may have characteristics in common, but the solution that is finally put in place for Manitoba, in terms of its relationship with Ottawa in this regard, will be a made in-Manitoba solution designed to best meet the needs of the people who live in this province and to have a good working relationship with Ottawa, which will be providing funding for the programs that we will then deliver. Ms. Friesen: Madam Speaker, I see the same secrecy continuing.

I would like to ask the minister, now that we know that the cabinet has approved, approved but not signed-we know that the cabinet has approved an agreement-will she tell Manitobans whether that will enable them to receive the same bilingual services that the federal government has provided. She has agreed to something. What has she agreed to? Mrs. Mcintosh: Madam Speaker, the member can indicate that she is conversant with the happenings in cabinet, and I say that she-I know not from whence she gathers her information.

918 LEGISLATIVE ASSEMBLY OF MANITOBA March 27, 1997 I can tell you that we have been negotiating for many months now, that we are close to being able to get an agreement with Ottawa. One of the things, of course, that we are looking for in terms of French language services is that services that people currently expect will be maintained, perhaps even enhanced, because they are important to the people who Jive here in this province.

That is the type of thing that will be kept foremost as we continue the discussions towards conclusion, that the needs of the people of Manitoba be dealt with in a very positive, proactive way that will see improved service and not loss of service. Ms. Friesen: Madam Speaker, could the minister confirm that the policy of her government has been to cut longer-term training such as New Careers and to substitute short-term training programs, which the Manitoba Chamber of Commerce refers to as low or no cost and no commitment required?

Is this what we can anticipate when the federal government has offloaded onto Manitoba labour service programs? Mrs. Mcintosh: The member asked two questions. believe she is only permitted one. I will answer her first question because I am only allowed to answer one. Her first question was, can I confirm that we are going to low-paying, short-term jobs? No, Madam Speaker, I will not confirm that. A.E. McKenzie Co. Ltd. Status Report Mr.

Leonard Evans (Brandon East): Madam Speaker, on Tuesday, December 20, 1994, the minister responsible for McKenzie Seeds attended a joint conference with officials of Regal Greetings & Gifts announcing the sale of McKenzie Seeds to Regal. Further, it was announced that the government will continue to hold $4.2 million of preferred shares in McKenzie for up to seven years in order to provide job security and ensure that the operation remains in Brandon. Since then, its newly appointed president has left without yet being replaced, while more senior direction is coming from Regal in Toronto.

Two vice presidents have left, and their positions are being abolished. The job of consumer products marketing assistant has been eliminated, and at the same time the marketing and sales office has been transferred to Toronto and a new position of new product manager is being established in Toronto. *

(1015) Madam Speaker: Order, please. Does the honourable member have a question, please. Mr. Leonard Evans: Can the minister tell the House whether this shift in operating control of McKenzie to Toronto and Regal Greetings in Toronto and the Joss of positions in Brandon is in keeping with the intent and the spirit of the government's sale agreement with Regal Greetings? Hon. Harold Gillesbammer (Minister of Labour): Madam Speaker, my honourable friend has not brought up McKenzie Seeds for a number of years. Certainly he is correct that in 1994 this company was bought by Regal Greetings & Gifts.

We had set out at that time six preconditions to the sale which were universally agreed upon. Those conditions have not been violated, and I am told that the number of employees at the Brandon plant has actually been enhanced. Madam Speaker: The honourable member for Brandon East, with a supplementary question. Mr. Leonard Evans: I would advise the minister to go to Brandon and talk to some of the employees who are worried about getting- Madam Speaker: Order, please. Mr.

Leonard Evans: Can the minister tell us how the government is monitoring developments at McKenzie Seeds to ensure that the new owners are truly maintaining the agreement to keep jobs and the control of the operation in the city of Brandon and, specifically, who is on the board of the company representing the government's interests? Mr. Gilleshamme r: Madam Speaker, I am truly disappointed in the member for Brandon East. When we discussed this a number of years ago, I can recall vividly him indicating that Brandon was not a good place for people to do business.

That, of course, is consistent with what we have heard from some of his

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 919 colleagues about other operations within the province of Manitoba, whether it is- Point of Order Mr. Leonard Evans: On a point of order, Madam Speaker, the minister is making allegations about statements that I made that I said Brandon was not a good place to do business. I never said that. I would never say that. The minister should withdraw that remark because it is not true. Madam Speaker: Order, please. The honourable member for Brandon East does not have a point of order. *** Madam Speaker: The honourable Minister of Labour, to complete his response. Mr.

Gilleshammer: Madam Speaker. Had I known my honourable friend was going to raise this issue, I would have brought along the clippings from the Brandon Sun where he was quoted as saying that, among a number of other things. I want to say to the member for Brandon East that the preconditions- Point of Order Mr. Steve Ashton (Opposition House Leader): A point of order, Madam Speaker. Under Beauchesne we understand that ministers do not have to answer questions if they do not want to answer questions, but we do have restrictions on ensuring that whatever answers are in place do have some relevancy to the question.

I would suggest, Madam Speaker, you call this minister to order. If he can do nothing better than to call into account the credibility of one of the longest serving members of this House who has always fought for Brandon, I would say he should withdraw those disgusting comments. Madam Speaker: The honourable government House leader, on the same point of order. Hon. James McCrae (Government House Leader): Madam Speaker, on the same point of order. The honourable members ought to know, or be at least reminded on this occasion, that matters related to the A.E.

McKenzie company are outside the administrative competence of the Minister of Labour in any event. So, while we are talking about points of order, it may well be an appropriate point to make at this time. * (10 20) Madam Speaker: The honourable government House leader, I believe, raised an additional point of order or a different point of order, so I will take both points of order under advisement and report back to the Chamber. *** Madam Speaker: The honourable Minister of Labour, to quickly complete his response to the question asked. Mr.

Gilleshammer: Madam Speaker, my honourable friend was asking some detail about the corporation. I would suggest that perhaps he talk to one of the board members. He perhaps knows Mr. Ray West, a long time resident of Brandon, who was named Man of the Year a few years ago by the Brandon Chamber of Commerce, and I would suggest that, if the member for Brandon East is in Brandon at some time, he should contact Mr. West. Mr. Leonard Evans: Well, not only is the minister being loose with the truth making false allegations, but he is being flippant. He is being flippant. He does not give a damn.

Some Honourable Members: Oh, oh. Madam Speaker: Order, please. The honourable member for Brandon East was recognized to pose a final supplementary question. Sale Agreement Tabling Request Mr. Leonard Evans (Brandon East): In the name of open government, will this minister now make available to this House a copy of the government's agreement with Regal Greetings and MDC, as was done in the sale

920 LEGISLATIVE ASSEMBLY OF MANITOBA March 27, 1997 of the Manitoba Data Services by the former Minister of Finance? In the name of open government, please table a copy of that agreement. Hon. Harold Gilleshammer (Minister of Labour): Madam Speaker, I would indicate again that the preconditions were built into the agreement and have been lived up to. I was told as recently as this morning that there are at least 10 additional staff positions at the operation in Brandon and an increase in payroll of almost half a million dollars since the time that Regal Greetings & Gifts bought McKenzie Seeds.

I will review the discussions we had when we last met dealing with the annual report and see that all the commitments we made there have been met. Home Oxygen Supply Service Rimer Alco Contract Mr. Dave Chomiak (Kildonan): Madam Speaker, despite the fact that no government report recommended the privatization of home care, the government has gone ahead to privatize a portion of home care.

It is ironic that on the Rimer Alco deal the government justifies Rimer A leo on the basis that they do not want to fragment service, yet the government is fragmenting service by privatizing some portion of-with the public portion. [interjection] I hope the Premier (Mr. Filmon) who speaks from his seat will answer the question as well.

Madam Speaker, my question to the Minister of Health: since this is a multimillion-dollar venture, will the minister-and since these are public dollars that are going to private companies-today provide us with the cost of the contract, the number of employees from Health that are going to be affected by that contract, the profit margin and the number of patients affected? *

(1025) Hon. Darren Praznik (Minister of Health): Madam Speaker, the value of this particular contract-and, as the member may not have pointed out, this was the lowest bidder. It was the only bidder, in fact, that resulted in a reduction of costs to our system. As was discussed when this matter was debated very thoroughly in the last session of the Legislature, we would only award no more than two quadrants of the city to a particular company for new entrants into the system.

Many of the details with respect to employer relations were part of an agreement reached with the union of the affected employees, the Manitoba Government Employees' Union. The value of this contract is approximately $5.6 million. Mr. Chomiak: Madam Speaker, this matter was never debated in the Chamber of the Legislature in Manitoba.

My supplementary to the minister: since the government promised that they would provide the standards and ensure the standards were enforced and they would be published so that patients would not be affected by this privatization, will the minister now table the standards that that company will be required to uphold and the criteria under which it will be dealing with patients? Mr. Praznik: Madam Speaker, absolutely. It was a commitment that my predecessor made, and I pleased to do that today. Mr. Chomiak: A new question to the Minister of Health, Madam Speaker.

The government has awarded a $5.6-million contract to a private company. Can the minister indicate the comparison between-will he outline for us what the profit considerations are from Olsten and what the comparison is of the rates paid to their employees versus the rates that will be paid to the employees of the government and the other contracted agencies, namely, the nonprofit VON, and what the comparisons are with respect to the service that is delivered? Mr. Praznik: Madam Speaker, to answer that question, I believe it is appropriate to put it in the context of the process in which bids were entertained.

As the member will probably recall from discussions with the previous Minister of Health in August of last year, proposals, a solicitation of interest was put out. Nine organizations were short-listed from that. Of those short-listed proponents, they were asked to provide requirements for formal proposals or they were asked to put in formal proposals to provide home care

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 921 service in the Winnipeg region. In December, those were received. Of the nine short-listed, I believe that five met the quality requirements. Three of those had other difficulties in which they decided not to pursue the contract. Three remained; their bids were opened. Only one of those bidders resulted in a saving from the estimated cost of delivering our own system. Madam Speaker, that is about a half-million-dollar saving on the two quadrants. Regional Health Authorities Elected Representatives Mr.

Kevin Lamoureux (Inkster): My question is also for the Minister of Health. It is to follow up with respect to the regional health boards. In Saskatchewan, it was clearly demonstrated through the way in which they had their elections that less than, I believe, 15 percent of people actually showed up for the actual vote. My question to the Minister of Health is will the government acknowledge in the election of regional health authorities that maybe the best way to administer that is at the same time that we elect our municipalities.

We would call on the minister to make a commitment that the next municipal election will also have on the ballots regional health boards being elected. *

(1030) Hon. Darren Praznik (Minister of Health): I think the average turnout in municipalities across this province is in the order of a third turnout. It varies across the province, but it is not as high as provincial and federal elections.

The real key issue in going to an elected system-I have said that to municipal officials, I have said that to regional health authorities, I have challenged him and members of the New Democratic Party-is what mechanism would they recommend to ensure that there is a direct taxing authority of some sort for those health authorities so that they can be responsible to the taxpayers and their electors. In any democratic system you have to have that responsibility to return to the electors, to the taxpayers, for the results of your decisions.

I have yet to hear of a model that the Liberal Party or New Democratic Party is prepared to argue publicly should be part of that elected system. Mr. Lamoureux: We would disagree with the government with respect to taxation rights. Madam Speaker: Order, please. Question. Mr. Lamoureux: My question to the minister-and, quite frankly, I would be prepared to debate him anywhere the Minister of Health would feel most comfortable-is specifically will this government commit to an election of regional health boards at the next municipal election.

People are going to the polls at that time-providing the additional ballot, so this way people will have a direct vote for these regional health care boards. Mr. Praznik: It is very interesting this position from the Liberal Party. They are suggesting that, without having the right to raise its own revenue, these boards, quite frankly, if they were to be elected then, would have no ultimate financial responsibility for the decisions.

All they would be setting up across the province-it is not direct involvement-they would be setting up that standard, classic debate of one group saying we want to deliver these services; we are really not accountable because we do not have to return to the taxpayers who pay the bill, so every one of our mistakes is someone else's fault. I think what has made our school boards more responsive and effective, our municipalities responsive and effective, is that they have some responsibility to their taxpayers and have to return to their taxpayers not just for election but also to levy a tax bill.

That right and that ability is absolutely critical I think to the effectiveness of any elected boards. We are not adverse to that, but let us get into the real discussion, which is how we develop that mechanism. Mr. Lamoureux: My question to the Minister of Health is why does he persist in using the taxation

922 LEGISLATIVE ASSEMBLY OF MANITOBA March27, 1997 rights as the issue in order to prolong indefinitely the need to have an elected regional board as opposed to a politically appointed board. Why does the government noi commit to elected regional boards? Mr. Praznik: If the member for Inkster wants to attack the whole concept of governments, we are elected, members opposite are elected by their constituents, members of Parliament are elected.

He is attacking the principle that we as elected members and trustees of the public, who have the responsibility to go back to the taxpayers for the results of our decisions, do not have the right that somehow, when we appoint boards to administer services, we have to go to the taxpayers to fund. If he is attacking that principle, then I would like him to attack as well the principle of all the appointments that his federal Liberal colleagues have made, including that of his former Leader to the Senate of Canada.

Madam Speaker, I am not asking to do that because I think that is unrealistic and unfair to the Government of Canada They were elected to discharge the duties. They will be responsible to the voters for whom they appoint. We have never said that we are adverse to elected boards. In fact, we have included that provision in the legislation. All we have said is there has to be a tax and responsibility, and Jet us get into that discussion and not try to hide from it. Spring Flooding Advance Preparation Mr. Gregory Dewar (Selkirk): Madam Speaker, my questions are for the Minister of Natural Resources.

Last night, over 200 area residents attended a public meeting in Selkirk to discuss preparations for potential spring flooding. One of the many concerns raised at the meeting was advance notice of the opening of the floodgate. My question is to the minister. Can the minister tell Manitobans what the government is doing to ensure that there will be as much advance notice as possible this year? Hon.

Glen Cummings (Minister of Natural Resources): Madam Speaker, certainly I would assure the member that the ministry is aware of the concern and will make sure to do everything possible to make the public aware of anything that is about to happen. Mr. Dewar: Madam Speaker, that answer is cold comfort to those individuals faced with the potential flood. My supplementary question to the same minister: can the minister tell the House what additional monitoring is being added this year in order to avoid a repeat of last year? Mr.

Cummings: Madam Speaker, we are dealing with the forces of nature, and in co-operation with EMO we have undertaken to make sure that public information is readily available, and advance warning on the issues such as the member raises is of primary importance. If he wants a time and a day and an hour, obviously, I cannot give him that. Mr. Dewar: Madam Speaker, my final question: could the minister tell the House whether he has made a decision on bringing in a hovercraft to break up the ice, as I and others have recommended to him over two months ago? Mr.

Cum mings: Madam Speaker, this is a serious matter when people's well-being, safety are at stake, and I do not think either the member for Selkirk or myself is trying to one-up each other on who has the best ideas as to how to deal with the issue. He is as well aware as I am with the information that was made available at the meetings, and that is that we intend to look at carefully and bring in people who have experience in this practice to advise us if it in fact can work under Manitoba conditions. If it is their advice that it will work, then we will attempt it. New Home Buyers City of Winnipeg Tax Credit Ms.

Marianne Cerilli (Radisson): Madam Speaker, we have concerns about the proposal passed by the City of Winnipeg yesterday to give a property tax break to new homes built on the periphery of the city, that even though there is a small incentive for infill over new lands, the report makes clear that the majority of new homes under this program will be on the outlying areas of the city. I want to ask the Minister of Urban Affairs and Housing if he will confirm that he supports this report. - -

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 923 Does the minister not agree that this program will not address the problem of a stagnant city population spreading out over a larger area, further increasing the burden on the majority of property taxpayers in Winnipeg? Hon. Jack Reimer (Minister of Housing): Madam Speaker, I find it ironic that the question and the criticism of what the city is trying to bring forth to stimulate an economy, to try to bring forth the creation of jobs through the housing industry is being overly critical.

The program that has been outlined by the City of Winnipeg is an incentive to increase not only the homes in the new development, but another component of it that I feel the member may not be aware of is that there is a component for infill housing also. I feel that this is a tremendous incentive for people to purchase homes as first-time buyers. They can look at savings upwards of almost $8,500 over three years if they combine the various rebates not only because of the rebate on the provincial side but on the homeowner side.

These are incentives that are going to create jobs, that are going to give first-time buyers the opportunity to be homeowners here in the city of Winnipeg. I believe this was an excellent initiative by the City of Winnipeg. Ms. Cerilli: Does the minister not realize that there is more than one and a half times more jobs created in renovation and retrofitting? Does the minister not agree that new homes built either just inside or just outside the city of Winnipeg line with no plan for existing urban home retrofitting and renovation will just further contribute to the decline of the urban core of Winnipeg? Mr.

Reimer: The member is referring to a home renovation program. This government had a tremendously successful home renovation program over the last few years, which added to the enhancement of a lot of homes in the city of Winnipeg. The new program that has been initiated by the City of Winnipeg is an add-on for the stimulation of the business. I find this very ironic that, with the initiatives that the city is trying to bring forth, there is a criticism of people wanting to own homes, to take advantage of the home ownership, to take advantage of the first-time homeowners.

This, Madam Speaker, I find very, very unfortunate. The home renovation program was a program that was very successful. In fact, it was that side of the government that voted against it. You cannot have your cake and eat it and be part of the recipe. *( 1040) Ms. Cerilli: Madam Speaker, my supplementary to the minister is will he make any requirements in this program for developers to complete existing housing developments, such as Harbour View South in my own constituency, rather than allowing new lands to be started for new housing developments on the periphery of the city.

Will they complete the existing housing developments so they qualify for services rather than opening up new lands in the periphery of the city? Mr. Reimer: The indication that I have from the City of Winnipeg is that the program is geared to new development. I believe it does not cover the additional new development as she has pointed out. It is in regard to homes in the development areas of the city of Winnipeg. It involves the homes that are in the infill area of the city of Winnipeg. So it has its expansive nature that a lot of the area's various components can be complied with.

The homes that were going to be constructed are homes that the Home Builders' Association can take advantage of with this program. The homeowners will benefit from it. There will be a tax rebate of upwards of, as I mentioned before, $8,500 over the next two years. So, Madam Speaker, it is a good thing. Law Reform Commission Termination Mr. Gord Mackintosh (St.

Johns): To the Minister of Justice, when the Pawley government appointed departmental staff to do the work, take on the work, of the Law Reform Commission, the Conservatives screamed bloody murder and in the 1988 election ran committing to restore the commission and enhance its independence. Then in '89 the Attorney General introduced legislation in this House that he said would, and I quote, protect the commission as far as possible

924 LEGISLATIVE ASSEMBLY OF MANITOBA March 27, 1997 from any attempt by any future government to destroy the effectiveness of the commission. My question to the minister: Given that the government is now committed to entirely abolishing the commission, would the minister admit that there is something wrong with this picture? Hon. Vic Toews (Minister of Justice and Attorney General): Madam Speaker, the issue is a difficult one, and it indicates the dilemma that we face at times when we are met with the budget restraints that have been imposed on us by the high-spending days of the Pawley government.

Some Honourable Members: Oh, oh. Madam Speaker: Order, please. The honourable Minister of Justice, to complete his response. Mr. Toews: The choice that we as a government had to make at this particular point in time was whether we continue the Law Reform Commission or whether we put those resources into public safety and community issues. My preference was into public safety, and I find it strange that the member for St. Johns would not support us in that respect. Madam Speaker: Time for Oral Questions has expired. Point of Order Madam Speaker: The honourable member for St. Johns, on a point of order. Mr.

Mackintosh: It just shows you cannot be part of the cake if you eat the recipe. Madam Speaker: The honourable member for St. Johns does not have a point of order. NONPOLITICAL STATEMENTS Madam Speaker: Does the honourable member for Brandon East-order, please. I am having difficulty even recognizing the honourable member for Brandon East, and I wonder if those members that are engaged in conversations would do so either in the loge or outside the Chamber. Brandon Royal Winter Fair Mr. Leonard Evans (Brandon East): Madam Speaker, I wonder if I could have leave for a nonpolitical statement.

Madam Speaker: Does the honourable member for Brandon East have leave to make a nonpolitical-leave has been granted. Mr. Leonard Evans: Madam Speaker, I would like to take the opportunity to urge all members of the House to attend the Royal Winter Fair in Brandon, which is scheduled for Tuesday, April 1. This is a long-standing tradition of the House to adjourn for that particular day so that members can take their families and friends to attend one of the finest shows of its type anywhere to be found in Canada or, indeed, North America.

It is indeed a first-class show, and among other things there is a wonderful horse show that we are usually privileged to see in the evening. My only complaint is that, at the same time as the horse show is going, there is a great CKLQ old-time fiddlers' contest d1at I like to hear, as well as, I know, others. So there are a lot of things going on to be taken in, and I would surely hope that each and every one of us will do our best to attend on Tuesday, April 1. Thank you. Chamber of Commerce Award Presentation Hon.

James McCrae (Minister of Environment): Madam Speaker, might I have leave to make a nonpolitical statement? Madam Speaker: Does the honourable Minister of the Environment have leave? [agreed] Mr. McCrae: Madam Speaker, last evening the Deputy Premier (Mr. Downey) and the Minister of Rural Development (Mr. Derkach) and I, and hundreds of others from the Brandon area attended the annual Chamber of Commerce dinner. At that dinner there was an award presented, the annual presentation of an award for the business person of the year. -

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 925 *( 1050) This year, the Chamber of Commerce, in its wisdom, significant wisdom I might say, decided to make that award to Mr. Stuart Craig of the Craig broadcasting company. The contribution of Mr. Craig and his father and his family, not only to the community in Brandon but through their efforts throughout Manitoba and now well beyond and all across western Canada, is well known to everyone, I am sure, in this Chamber.

I just wanted to call this matter to the attention of honourable members, because I think it is a well-deserved recognition of the work of the Craig family in general and Stuart Craig in particular of their contribution to our cultural life, to our ability to know what is going on in the world today through news broadcasts done by Craig broadcasting company. I just thought that honourable members would like to be aware that this citizen of Brandon has distinguished himself not only in our area but nationally, and I believe in the future more and more internationally.

A very successful story for Manitoba and congratulations go to Mr. Stuart Craig. Mr. Gary Doer (Leader of the Opposition): May I have leave for a nonpolitical statement? Madam Speaker: Does the honourable Leader of the official opposition have leave for a nonpolitical statement? [agreed] Mr. Doer: Madam Speaker, I would like to join with the Minister of Environment in paying tribute to Stuart Craig and recognizing his tremendous contributions to Manitoba. Before I was elected, I had the opportunity to participate in letters of support to the CRTC for the Craig network to establish the MTN or Manitoba network.

I think all of us feel in this House and all of us feel in public affairs and debate that there is often a tremendous void in coverage in communities outside of the so-called Perimeter Highway. I think to some degree we tried to meet that. The Pawley government tried to work with the former federal government to meet those challenges by establishing some native communication systems in northern Manitoba to start getting the video and voice messages of people in those communities that would deal with the unique nature and the unique challenges of those communities.

I think it is also similarly true that the Craig family, with the establishment of the MTN network and the work in Brandon, has been able to get a lot more of the stories of Manitoba communities, of the diversity of Manitoba communities and the diversity of stories across to all Manitobans, and for that I think every member of this Chamber, no matter what our political stripe, is indebted.

I am pleased to see that many local communities in the Craig system have their own networks and access to those networks, and I have always found that the media network, the Craig networks have always been very fair to all political parties in having the opportunity to speak directly to the viewers or to the people in the other forms of media. I think it also very interesting to note that in Alberta, the Craig family has been awarded the licences in Alberta, but he was competing against another Manitoban, Izzy Asper.

I think when we look at what these two business people have done in terms of establishing communications across Canada, I think we are to be very proud. Having said that, Madam Speaker, I also think we have to redouble and triple our efforts to ensure that we have a nonprofit public broadcasting network that also will provide, not competition, but the balance. We always talk about balance in here, I think we also have to, in paying tribute to Mr. Craig, remember that we need balance in our broadcasts and balance in our coverage.

It is interesting that the TV station in Brandon is a private station but also receives the national feed from the CBC, both in their local news coverage and in their evening news coverage. So I want to pay tribute to Mr. Craig, wish his family well and also pay tribute to the ability of all Manitobans to have access to public and private broadcasting. Global Change Game Mr. Tim Sale (Crescentwood): A nonpolitical statement, Madam Speaker.

926 LEGISLATIVE ASSEMBLY OF MANITOBA March 27, 1997 Madam Speaker: Does the honourable member for Crescentwood have leave to make a nonpolitical statement? [agreed] Mr. Sale: Madam Speaker, I rise to pay tribute to a group of Manitobans who have developed over the last five years an environmental education project called the Global Change Game. These young people, for the most part, were graduates of the universities of Winnipeg and Manitoba, some in natural resources and some in other areas.

They took it upon themselves to develop a game that involves simulating the world's current environment and playing forward into the future with assumptions about global arms, pollution, health care, feeding, resources, et cetera, with largely high school students, although many adults and university students have also play ed the game. Madam Speaker, they have toured this game across Canada from Victoria to St. John's, Newfoundland. They have had the support of the Mennonite Central Committee, Via Rail Canada and other corporate sponsors to make this game available.

I have had the honour and opportunity to have the game played twice in two high schools in my constituency, in Kelvin and Grant Park. In both cases, approximately 90 young people took a morning to find out how complex it is to think about public policy in managing the environment of our world in the kind of conditions it finds itself in. Madam Speaker, recently this group of young Manitobans were the winners of the Sustainable Development awards in the category of education. The game is now on tour in eastern Canada. By the end of this year, more than 400 high schools across the country will have used this game.

I commend it to honourable members of both sides of the House as a marvellous educational opportunity in environmental and other policies moving us towards a more sustainable world. The Global Change Game can be located easily in the phone book, and I hope other members will take advantage of it for their high schools. ORDERS OF THE DA Y Hon. James McCrae (Government House Leader): Madam Speaker, I move, seconded by the honourable Deputy Premier (Mr. Downey), that Madam Speaker do now leave the Chair and the House resolve itself into the Committee of the Whole to continue considering Bill 10.

Motion agreed to, and the House resolved itself into a Committee of the Whole to continue to consider Bill 10 with the honourable member for St. Norbert (Mr. Laurendeau) in the Chair. *( 1100) COMMITTEE OF THE WHOLE BilllO-Tbe Interim Appropriation Act, 1997 Mr. Chairperson: Order, please. We have been considering Bill 10, so we are resuming consideration of the bill. Is the House ready for the question? Some Honourable Members: No. Mr. Chairperson: Okay. In that case, we will recess for just a second, okay? Order, please. The committee will come to order. We are resuming consideration of Bill 10. Mr.

Steve Ashton (Thompson): Mr. Chairperson, I realize we have some ministers who will be in shortly to answer questions. I wanted to put some issues on the record, and I will raise this with ministers perhaps via way of Hansard rather than waste any of the valuable time for Interim Supply. They are to do with northern Manitoba, and I wish to deal with some transportation issues which I wish to put on the record to deal with.

I want to, first of all, indicate that we will be pursuing these issues further during Estimates, but I think members opposite can understand that our transportation links are vitally important for northern Manitoba. I want to start with the issue of highways. I want to note, by the way, there has been some progress on some of the specific projects that I have certainly been raising, as the member for Flin Flon (Mr. Jennissen) has raised this year, particularly 391 which has been announced. There has been some priority given to 391 -

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 927 and also the access lane for Wabowden, and I am very pleased in both cases. These were issues that were raised by the communities affected. These issues were raised at the meeting which the then Minister of Northern Affairs and the current Minister of Health (Mr. Praznik) attended in Thompson in 1995. In fact, I raised the specific projects at that time. I have raised them in writing with the minister. I want to remark on that because I do think there is some positive response to the communities and some of the issues that we have raised.

I know I have been very critical on highways, but I want to put that on the record initially. I am somewhat disappointed that essentially what has happened is that the government is still not recognizing the need to go back to the kind of allocation for northern Manitoba that existed prior to 1988 and, in fact, even in their first term as a minority government. Under the NDP, northern roads received close to 25 percent of the budget in given years, and that should not be a surprise given the needs in the North, given the fact there are many communities do not have a road.

I am quite disappointed that, even though the spending on highways in northern Manitoba this year is somewhat increased, it has dropped as low as 5, 6 percent according to the minister's own figures a couple of years ago in various years, and I still believe that the minister is using formulas which do not indicate the need. He has talked about the percent of the road network that is in northern Manitoba and allocating a percentage for construction that reflects that. I would suggest that we should also include the percent of roads that are not there, that should be there.

I want to put on the record that communities in my constituency, such as Thicket Portage, Pikwitonei, Ilford, and York Landing have no roads, and I have raised the specific concerns with them. I want to put on the record, and I will be raising this directly with the minister, concern about Thicket Portage. Because of Repap's logging activities, the road will be very close to the community of Thicket Portage. I think there is an opportunity to establish an all weather road. It is going to require some commitment from the government to maintain the road and to provide the access.

I want to suggest that that should be a priority for the department. I think there has to be consideration for Pikwitonei, as well, and both these communities, of course, are on the rail line. While we are hopeful that rail service will continue with the OmniTRAX company, I think anyone can see that there are some very real concerns. York Landing and II ford: York Landing has been attempting to get all-weather road access into Split Lake, which gives it access to the provincial highway system. Ilford actually had a road that was on the books. In 1977, it was cancelled by the Lyon government when it was elected.

What is interesting on that is, I think, it was a lost opportunity at the time. After that, the communities did pursue other projects and options. I looked at the member for Arthur-Virden (Mr. Downey), who was a member of that government, and he will remember that. It was cancelled in 1977 and it is unfortunate, the road between Ilford and York Landing which would have given the people of Ilford access to the ferry which runs between York Landing and Split Lake. I just wanted to put that on the record.

I want to indicate in advance, too, that we will be raising some questions about the future of the rail line and the port. I have met with some of the officials from OmniTRAX, and I want to indicate that there is still a lot of concern on the Bay Line about the future of our transportation links. The bottom line is we are very concerned about that. My communities in northern Manitoba, the communities I represent, are very concerned about that. I was just, for example, in Thicket Portage, and people are very anxious to find out what is going to happen in terms of long-term rail service.

I want to indicate there are some real opportunities, I believe, in some of the communities in northern Manitoba for economic development, and I want to throw this out as a challenge to the government. I am prepared to provide a whole series of ideas that really reflect what I am hearing in the communities about ways in which we can deal with economic development in northern Manitoba. I think there has to be a recognition from the government of the unique circumstances in Northern Affairs communities and First Nations communities. The bottom line is we have to, we absolutely have to, I think, put a major, major

928 LEGISLATIVE AS SEMBLY OF MANITOBA March 27, 1997 commitment in and, quite frankly, I am not sure if that commitment is in place. I have other issues I wish to deal with, but one of the ministers is here, the Minis ter of Rural Development (Mr. Derkach), and I know there are some questions. I will put those remarks on the record, forward them to the Minister of Highways (Mr. Findlay), and hopefully the Min ister of Highways can respond to me, if not at this committee, in writing. Mr. Tim Sale (Crescentwood): Mr. Chairperson, I have a series of questions for the Minis ter of Rural Development.

I would just like to get some background on the current situation facing a number of the companies that Manitobans have invested in and that our government has supported through the Grow Bonds Program. First of all , I wonder if the minister could indicate whether the dividends or interest payments are current for the following companies, and I will list them for him. First of all, the list is as printed awhile back so the order is more or less in the order that the bonds were issued , although not entirely. It is close.

First of all, the Rimer A leo company, are they current with their dividends and/or bond interest, Care Corporation, Gilbert International and RCS Greenhouses. *( 1110) Hon. Leonard Derkach (Minister of Rural Development): Mr. Chairperson, I would like to indicate that I would certainly be pleased to research the status of the dividends as they might exist as of this particular time.

I cannot honestly indicate on each and every one of these whether they are current with their dividends, unless we go back to the bond corporations and ask that question, but we certainly will pursue that information and make that available. Mr. Sale: Mr. Chairperson, that answer is precisely the problem that the Auditor pointed out when he did, I think by all agreements, a devastating report on the handling of the Woodstone Grow Bond.

He pointed out that the government had failed to implement any kind of reasonable oversight of the bond, failed to ensure that the Grow Bond corporations, in the case of the Woodstone corporation, actually fulfilled the regulations which the minister knows and has some responsibility to enforce.

So when the minister stands up and tells the House that he does not know if companies that are supposedly under some kind of scrutiny in his department are even current with the Manitobans' dividends or interest payments who invested in them, I find that a shocking admission of the minister's either incompetence or cavalier attitude towards the investment of many, many millions of dollars. The Min ister of Rural Development (Mr. Derkach) has stood in this House and bragged about how many millions of dollars have been levered by the investment of $8 million in Grow Bonds.

The minister has never stood up and said that some hundreds and hundreds of Manitobans lost $6.6 million in the Woodstone operation. It was levered all right. It was levered right down the drain. Manitobans have lost-that is the amount of creditors, the total value of the creditors for the Woodstone corporation-$6.6 million. An Honourable Member: Of our money. Mr. Sale: OfManitobans' money. [interjection] No, of Manitobans' money. Mr. Chairperson, through you to the minister, you brag about how many dollars have been levered by Manitobans' investments .

What you do not tell Manitobans is how many dollars have been lost by virtue of your failure to provide oversight of the corporations in which you have invested. I say for the record that the Care corporation of Winnipeg is not current in its payments. The minister may wish to take that information and research it further. He has letters on file from a number of bondholders in the Care Corporation, one of which is a gentleman in Victoria who holds $50,000 ofbonds. He has not been paid. As oflast July, he has still not been paid.

He has been told by a senior official of the minister's department that that official thinks there are enough assets in the company to pay off all the bonds when the company is put into bankruptcy. Now that is a pretty devastating statement from a deputy minister to -

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 929 come to a bondholder. In other words, we have got another company here that has failed to pay its bonds. The Waskada greenhouse was in the news a number of times as they attempted to get refinancing to stay in business, and apparently they have got some money to put the next crop in. Surely to goodness, the minister has had at least one meeting with his officials in the last little while, while there were concerns about this greenhouse, and has asked them is the company current with the bondholders. Is our Grow Bond at risk?

Did he ask that question of his officials? If he did, what was the answer? If he did not, why is he the minister? What is his role if it is not to have some oversight of companies where there is some risk and to be able to take whatever kind of remedial action is available to him, or does he just watch as these companies fall one by one? Mr. Derkach: I have to indicate that I am appalled and so are Manitobans appalled at the approach that this particular member has taken with rural companies and with rural Manitobans. It is a shameful and a disgusting approach that has been taken.

He takes this high-handed approach as though, I know it all and let me tell you how we should formulate these companies and let me tell you how we should save them. He has got all these answers, Mr. Chairman. He goes out to the public, and he makes statements that are absolutely untrue. He makes statements that are absolutely false, misleads companies, misleads- Point of Order Mr. Chairperson: Order, please. The honourable member for Crescentwood, on a point of order. Mr. Sale: The minister is both imputing motives and making accusations in terms of use of truth and falsehood.

The minister ought to withdraw those statements and continue the debate in an orderly manner, Mr. Chairperson. Mr. Chairperson: Order, please. The minister was pushing the line a little bit on some of his statements. I would ask him to withdraw that one portion that was directly impugning motive to the member. Mr. Derkach: Mr. Chairman, if l have offended yo u in terms of the language that I have used, I will withdraw that. Mr. Chairperson: I thank the honourable minister for that. *** Mr. Chairperson: The honourable minister, to continue his response. Mr. Derkach: Mr.

Chairman, I have never seen such sloppy research as has been done by this member for Crescentwood. All y ou have to do is look at the statements that were absolutely strangers from the truth with regard to the comments he made about Woodstone in the initial stages. One of the issues that was at stake with W oodstone, when W oodstone was having its financial difficulties, was the fact that we had a company that was trying to refinance its company, so that jobs could be preserved in the community of Portage. The member of Crescentwood's solution to that was close the company in Portage and move it to Winnipeg.

That was going to be his solution to preserving those jobs in Portage. Then he stands up in the House and he says why is the minister not protecting these jobs in Portage. I think his credibility is well known in the rural parts of this province and indeed in this entire province, and it certainly is not held in high esteem. Mr. Chairman, I have to talk about Rimer Also for a minute, another rural company that this member has attacked for no reason at all.

Here is a company that is employing rural Manitobans, giving jobs to families in rural Manitoba, and it has bid on a contract, a contract worth something less than $2 million, I believe. In addition to that, they were requested to bring a bond forward that was worth about $1 .7 million, I believe, and they were able to secure that bond. This member made a statement in the House that this company was insolvent. That was an absolutely false statement. He misled, whether willingly or unwillingly, rural Manitobans and Manitobans right through this province about this company's state. Why?

Why are you attacking rural Manitobans, rural companies,

930 LEGISLATIVE ASSE MBLY OF MANITOBA March 27, 1997 people who are trying to make a living for their families, by spreading this kind of false information throughout the province? Now, he asked the question about whether or not dividends are current on specific companies. I indicated to him that, as of today, we do not know that. We can find that out. My staff keep in touch with companies at all times, Mr. Chairman, but we do not know the day-to-day dealings with these companies. One of the other things that has to be acknowledged is cl ient confidentiality. Does this member know anything about that?

Does he know anything about client confidentiality? Today he brings another statement to this House that is absolutely a long way from the truth. He says that we put $6 million of taxpayer money at risk with Woodstone Foods. That is wrong, absolutely wrong. The guarantee that this province put on the table was for some $970,000 with regard to the Grow Bond. It is understood by Manitobans throughout that this is a Venture Capital program, and there will be plants that will, in fact, fail. It is unfortunate but that happens in business. An Honourable Member: Half of them? Mr. Derkach: Half.

Now he makes another rash statement, another untruth, Mr. Chair, because he says half of them are now going down. Mr. Chairperson: Order, please. Mr. Derkach: Mr. Chair, I apologize for using that term. Mr. Chairperson: Order, please. I would ask the honourable member to retract that statement. He already has, I think. The honourable member to continue. Mr. Derkach: Mr. Chair, how can anyone stretch the truth in that way by bringing to this House a statement that says half of the Grow Bonds are going down or fail? Where does he get his information? All of these companies are in rural Manitoba So what is he doing?

Is he helping these plants that are trying to struggle to survive in the rural part of our province, that are employing people in the rural part of our province? My department works very hard with every one of these companies, and, yes, there are companies that are having difficulty. There is no question about that. We are working with the communities and working with the companies and working with individuals. We are trying to find partners in some of these instances to try and ensure that jobs for these families, these communities can be sustained and can be secured for the long term.

I also have to tell the member, although he does not acknowledge this and would never admit to it, in 1994, it was this minister and this department that asked for the Auditor to come in and take a look at the processes that we were undertaking with respect to Grow Bonds, to give us some idea of whether or not this new program was following procedures as we should in normal business practice. There were recommendations that were made by the Auditor at that time, and those recommendations were followed, and when we asked once again, yes-and the member for Crescentwood (M r. Sale) shakes his head.

Well, he is wrong again because when we asked for the audit in 1996, the Auditor very clearly stated that the recommendations that were made in 199 4 had been progressed with by the department and indeed had been implemented. Once again he made other recommendations, and those are being followed up. They are not going to be ignored. *( 1120) An Honourable Member: They have been so far. Mr. Derkach: Now he makes another statement. He says, they have been so far.

He does not know of what he speaks, but that is not unusual for this member because that is the way he approaches everything, whether it is finances, whether it is Rimer Also, whether it is Woodstone, or whether it is any other rural company in Manitoba. He comes in with half-truths, puts it on the record, and then expects Manitobans to, in some way, believe that he is, in fact, telling Manitobans the realities of the situation.

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 931 Well, Mr. Chair, I want to indicate very clearly that, in every one of these situations, my staff are current with regard to the status of all of the companies. If you ask me today to disclose whether or not Rimer Also, Care, Gilbert International, RCS Greenhouses are current with their dividends, I said I would go back to my department to ensure that whatever I put on this record is not indeed false, that the information that I bring back here is going to be accurate.

Surely, the member wants the information to be accurate and he wants it to be up to date, or does he just want us to make statements so he can get up in the House and then contradict them or in some way destroy the credibility of another company? These are very important companies to this province. The people that work in them contribute to the economy in a very real way. They sustain their families on these jobs, and whether they are in Arborg or whether they are in Portage la Prairie or in Waskada or whether they are in Morden or Killarney, they are all important.

Yes, there will be times when these companies experience difficulties. It should be known that indeed if these companies were all flush before they came for funding to us, they would go to the banks, so it has to be recognized that the programs that they have, whether they are Grow Bonds or other programs that governments extend, are indeed Venture Capital programs, where there is risk and anytime we have risk we know that a company may fail. Look at the national statistics with regard to Venture Capital companies. What do the national statistics tell you?

The national statistics tell you that six out of 10 companies will fail; two of the four that will survive will have great difficulty; two will probably do well. Well, I have to tell the member opposite we are far above that level of success at this point in time, and I am hoping and praying that we can continue that way. We will do everything we can to ensure that we explore every possible opportunity in the projects that are having difficulty. I have never said that all of our Grow Bond companies are flush and are not having difficulties. There are some that are having difficulties, but Mr.

Chair, this is not the place to debate companies on a one-to-one basis. Client confidentiality has to be respected, and if the member were honourable and wanted to know some information. he would call my office- Mr. Chairperson: Order, please. I would ask the honourable minister to retract that statement. All honourable members are honourable. Mr. Derkach: I am sorry. Mr. Chairperson: I thank the honourable minister. The honourable minister, to conclude. Mr.

Derkach: If this member had indeed a serious tone about how he approaches these matters, he would can my office, we could sit down, and we could discuss, as we have with the member for the Interlake (Mr. Clif Evans), who is a critic for Rural Development. When he has an issue, we do sit down and we do talk about it, and maybe we will not agree, maybe our philosophical approach will be different to a problem, but, indeed, at least then we have the information on the table as much as we can disclose. I would be happy to do that with the member for Crescentwood (Mr.

Sale), but, indeed, he has to express a willingness to be able to do this so that indeed our interests then could be for the betterment of the companies that are operating in this province, Mr. Chairperson. Thank you. Mr. Sale: Mr. Chairperson, I would suggest that the minister tone down his rhetoric and look at some of the realities. First of all, he just finished pointing out that, in fact, on a national basis some six out of 10 Venture Capital funded corporations do fail, and that, as he said, two out of the remaining four will have great difficulty.

So, when I say that it would not be unreasonable to expect that we might lose half of these companies at some point, his own statistics are suggesting that I am not far off the mark. In fact, I am being conservative in terms of the total risk, and I would sure not, you know, mind being conservative in terms of that kind of risk. Let me direct the minister to his own comments about the W oodstone fiasco. The minister stood in this House, and so did the Minister of Finance (Mr.

Stefanson) assert, that all the audit would serve to do was to point out that all was well, that there were no serious problems with this company, and that we were fearmongering, et cetera. Well, I just draw the minister's attention to the fact that in January of 1995 before the April election, the minister's department had data that showed that the company that year on sales of

932 LEGISLATIV E ASSE MBLY OF MANITOBA March 27, 1997 $5 .7 million-not up from the previous year, as was promoted and promised-lost $1 .4 million on sales of $5.7 million. The bank indebtedness increased. Their sales decreased. Their inventory increased , and he and/or his staff did nothing. He has a regulation in his Grow Bonds legislative package that requires-it is not permissive; it is not something that he can or cannot do depending on his whim-that 170 days after the end of any fiscal period, audited financial statements will be sent to all Grow Bond holders.

No Grow Bond holder in the Care Corporation in Teulon which I have been able to contact, and no Grow Bond holder in Woodstone which I have been able to contact, ever received an audited financial statement about the companies in which they held money, held bonds-nobody. The minister knows this is a regulation, and he knows that his own officials have sat still while corporation after corporation broke the regulations. He has a sworn duty to maintain these regulations. They are not options.

After the 199 4 audit said you have to do some things to strengthen what you are doing in this program, a few things were done. The minister is correct. Why, after four years of operating this program, are the regulations not enforced routinely company by company by company? But they are not.

Now, the minister makes hysterical allegations that my concern about Woodstone and Care and Rimer and all the others that are out there, including Crocus which the minister now owns through the Manitoba Development Corporation, he makes the allegation that I raise these questions or my colleague from the Interlake raises these questions because we somehow do not care about jobs. The absolute reverse is the case because the minister knows from his own officials-if he does not, I would suggest he talk with Mr.

Sweatman; perhaps he should talk with him more frequently-that when a Venture Capital investment is made by any good Venture capitalist, whether it is the Crocus Fund or Vision Manitoba or whatever it is, one of the things those Venture capitalists do is they get involved with the companies that they have invested in. They mentor them and they support them. They monitor them. They look at their cash flow and they watch their sales. They look at their marketing strategies, and they ask questions about how the business plan is going. They do not tum a blind eye.

They do not defeat the ability of shareholders or bondholders to have information they need on which to judge how the company is doing. They do not have annual meetings that, effectively, put friends of the company on the board of the bond corporation so it will not ask questions, which is what happened in the case of W oodstone. * (1 13 0) Mr. Chairperson, members on this side of the House are deeply concerned about jobs in rural Manitoba, as well as in urban Manitoba.

What we are seeing happening is that jobs are failing and being lost because this minis ter and his department do not do the mentoring, do not do the supporting. They do not do the work with the corporations. They throw their hands up and say, oh, that is the local bond corporation's problem. Well, the local bond corporations are made up of volunteers, very well meaning often and very competent members often, but they are not paid to babysit the corporations in which they have invested.

In fact, in many cases, as the minister knows, there may well be that confidentiality requirement which would prevent a Grow Bond board officer from acting in a mentoring capacity to the company in question. I give him the example of the situation again in W oodstone where one of the original Grow Bond members was a financial adviser. He was a member of a financial institution, but he happened not to be a member of the financial institution that Woodstone dealt with.

So do you think Woodstone would disclose to that person intimate details of how they were doing on sales and marketing when he was with a competitor organiza tion? Of course not. The minister makes what is a very good point in def ence of a very weak department's operation. There is a real question about third-party confidentiality, but this minister does not do that any good by providing either no information or scant information to bondholders who are not then in a position to ask questions that might help the company survive.

His attitude is keep it secret, keep it quiet and run around in great circles trying to save something, but do not let anybody know about it and deny and deny and deny

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 933 until the day when the bankruptcy writ is filed or the day in which he has to take the company over because he has failed to provide the nurturing and mentoring that any Venture Capital investor would make and provide in any company that they invested in. So Jet him not suggest that we do not care about jobs.

Every time a company goes down because he failed to do his job, it is his government's failure that is at stake here and not the fact that the opposition has asked questions about the capacity or the interest of his department to do their job in mentoring these new corporations. Mr. Chairperson, the Department of Rural Development has finally hired one or two more people-I am not sure; the minister will no doubt tell us-to help deal with the Grow Bond portfolio. Mr. Chairperson, I have talked to Venture capitalists in Manitoba and I have talked to them in Toronto, and I asked them a simple question.

I asked this question specifically of the senior partner of Arthur Andersen in Winnipeg who has a Venture Capital arm. I said to him, if you had in your portfolio 20 small, young vulnerable corporations in which you had invested, had venture investment-that is an investment seeking on average 20 to 30 percent return in order to deal with the risk inherent in this-if you had done that, I said to him, how many staff would your need to mentor those companies effectively? Arthur Andersen is not an inefficient corporation. They are the largest consultancy in the world in financial consulting. You know what he told me?

He said that he would need at least six people working full time working with those companies on a monthly basis, looking at their sales, looking at their marketing, looking at their human resource development, looking at their capital investment, looking at how they were pursuing their patents. He said, at minimum my company would have six people, approximately one person for every four venture investments that we made, in total terms, to support that kind of portfolio. Now, we are not talking about one clerical person, we are talking about somebody who knows how to nurture an investment successfully.

The failure in this program is not the failure of the concept of local people investing in jobs in their community. It is certainly not the failure of local entrepreneurs who want to have the opportunity to develop viable smaller companies in rural Manitoba or, for that matter, in urban Manitoba. I think the concept would work well in urban Manitoba too.

It is a rural concept and we support it and I support it, but you do not do rural Manitoba any favours any more than you would be doing urban Manitoba to invest a chunk of change and then say we will see you in a year, we will see you at the next annual meeting of the Grow Bond corporation. At the next annual meeting of the Grow Bond Corporation, you do not even send out financial statements.

You do not provide any kind of serious review, and when we ask have you been involved with the kinds of things the Auditor asks, for example, in his report on Woodstone-which is a devastating critique, not of the failure of the existing staff of the program but of the failure of the minister to ensure the resources were there to do the job which the Auditor finally had to tell you you were not doing, you did not do in the case of Woodstone, you are not doing in the case of the Care Corporation, you have not done with Crocus which went belly up, as well.

You have lost the Manitobans' money who was involved in that. Crocus corporation is now owned by the Manitoba Development Corporation, and you had to pay out the bond. It has had to go through refinancing. In other words, the investors have lost their money and you have lost our money. The real issue here is not the question of whether Venture Capital in rural Manitoba is a good idea or not. The real issue is that this government has failed to provide the resources to enter into that program in a successful and sustainable way. Mr.

Chairperson, I want to ask the minister at the end of my remarks if he will undertake to return very shortly to this House with a list of the corporations which have complied with the regulation requiring that 170 days after their year-end, financial statements have been sent out to the bondholders. In other words, I would like to know where his department is in ensuring the rights of bondholders to information.

934 LEGISLATIVE ASS EMBLY OF MANITOBA March 27, 1997 They are Manitobans, too. They are Manitobans who have risked their capital and the interest on that capital. They have put it aside because they believed in their communities, and your department has let them down by not protecting their rights, just as you have let down the companies in which they invested by not providing the kind of support and sustenance that any decent Venture capitalist would provide if they were risking a half a million or even a hundred thousand dollars in a new entity. They would be there every month.

They would be looking at the cash flow. They would be looking at the receivables and the payables. They would be looking at the technology. They would be investing time and energy. Your department does not have the resources to do that. So let it be understood that we are supportive of the concept of the investment in those bonds. We are supportive of the development of those corporations, but you do Manitobans no favours when you fail to support the program with the resources it needs to do its work, and it does not have those resources today.

It has never had those resources, and the result is that corporation after corporation is not fulfilling the mandate that it undertook in terms of its Grow Bond board. It is not getting the oversight that they need in many cases to survive those rocky few years and get to the point of being self-sustaining. Mr. Chairperson, the minister talked about concerns around Rimer Alco. The government appointed Gordon McFarlane, who is an accountant with Doane Raymond, a private sector accountant. In the committee meeting that assessed the bids, Mr.

McFarlane said: I have grave concerns about awarding a contract to this company because of its fiscal situation. He said he had grave concerns. Now, to me, when an auditor uses terms like "grave concerns," this is a very serious matter because auditors are not known for using flowery speech or making extreme statements. Mr. McFarlane expressed grave concerns. *

(1140) A cursory look at Rimer Alco's balance sheet on March 31, 1996, would show that its current liabilities exceeded slightly its current assets and it had long-term and short-term debt. There was virtually no equity in the company whatsoever. [interjection] That is M r. Mc Farlane's assessment of this company in the committee meeting. Mr. McFarlane was the person who was hired to do that, and he did his job well, I believe. An Honourable Member: You are prepared to put that on the record outside the House . Mr. Sale: Mr. McFarlane is the person who put that on the record .

He put it on record in the committee meeting. I have also put on record the fact that the statements do not present the picture of financial health, and I am very, very happy to confirm that. I would imagine that if a minister is not, then he has even more serious problems administering the Grow Bond Program than anyone else. I would just conclude by saying that the minister, I hope, acknowledges what he said privately to me, that Woodstone was a disaster, that its management was a disaster, that he wanted to never see the face of the person again.

Yet only a few weeks after he said those things to me from his seat in the House, his own officials were still pushing Woodstone. They were still pushing Mr. Nickel and Mr. Mullen and Mr. Brazz ell as wonderful investors who were just going to put their company back on the market. Mr. Sweatman was telling American investors that all was well, all was well, and yet the financial statements for that company, which the minister consistently refused to make available to bondholders, showed that even a year earlier it had lost $1 .4 million.

It had lost, in effect, 30 percent on every dollar sold, which is virtually exactly the figure that we said was happening when we first raised this issue in the House and tried to get some attention paid to it. Instead, we went on for another full year. Workers lost $2 12, 000 in wages because this government would not support the fact that they had the right to those wages so they paid out the bond instead. The minister's officials met with Labour Canada, and Labour Canada said these workers had a right to these monies. Instead, this minister said no, my friend Mr. Brazz ell and my friend Mr.

Nickel and my friend Mr. Mullen have a right to their Grow Bond and we will pay the Grow Bond out before you can table that order in court so that those workers cannot get their wages

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 935 back. That is what they did; they paid out the Grow Bonds before the workers' order for payment of wages could be tabled in court. Now it is tabled in court and the money is gone. He talks about being concerned about workers. He is not even close, when 57 workers have wages owing to them and he gives money away to the principals that took money out of this province to the tune of $6.4 million of our money, of Key-Point Transportation's money, of Walker Seeds' money, of any number of suppliers' money.

So instead of dealing with the issue of at least the workers, the poorest of the group, he hands back the Grow Bond money early, earlier than the court order could be put in place, earlier than the workers could attach that money, so that they at least could pay their mortgages and put food on their table. This minister talks about our concern for jobs. Let him understand that we are the only party that has spoken up for these workers over the last year and a half. We are the only party that has spoken up for them and tried to get their wages back.

We are the only party that raised the questions about the potentially fraudulent actions of the previous ownership of W oodstone Corporation. The member for Portage la Prairie (Mr. Pallister) stands behind and hoos and hahs while his own workers that he is going to have to campaign to are going to be asking him, why did you not care enough about my wages? Why are we not going to care enough about my wages to recover them from these people who flimflammed Manitobans? Point of Order Mr. Brian Pallister (Portage Ia Prairie): On a point of order, Mr.

Chairman, the reality, of course, is somewhat different than what is perceived by the member for Crescentwood, which is not uncommon with his comments. The fact is that I have worked diligently with the people of Woodstone, that I have stood by them throughout this whole process. The fact is that the member for Crescentwood has done nothing other than attempt to move them away from their homes and their communities. Mr. Chairperson: Order, please. The honourable minister did not have a point of order. It is clearly a dispute over the facts. *** Mr.

Chairperson: The honourable member for Crescentwood, to complete his question. Mr.

Sale: I will just conclude by saying that this minister, if he really is concerned about rural jobs, will strengthen in a very sincere and very significant manner the ability of his department to do what it has not been able to do so far, and that is to provide the kind of support and counselling, active intervention with the companies in which Manitobans have invested so that all of us, the rural employees, the rural entrepreneurs, the rural bondholders will have a much better chance of success than they do under the kind of cavalier stewardship in which the minister does not seem to know about the current status of any of the companies in trouble, does not seem to care about the fact that there are companies at risk because he does not put the staff resources or the energy and time in place to give them a real shot at success.

Let him defend to the workers that have lost their jobs because of his inability to supervise and to provide entrepreneurial support why he has not done so. Mr. Derkach: Mr. Chair, let me begin first of all by indicating to the House that my department has always ensured that we are current with regard to the status of every company that we have supported through the Grow Bonds Program.

Just to demonstrate the sincerity with which my department addresses the Grow Bonds Program I think is demonstrated by the fact that in 199 4 we indeed did ask the Provincial Auditor to come in and take a look at the processes that we were following with respect to the Woodstone project, because this was the largest Grow Bond at the time and indeed it was a new program that we had launched. We wanted to ensure that all of the processes that we were following were indeed proper and correct. It was indicated at that time by the Provincial Auditor that indeed there were some procedures that needed to

936 LEGISLATIVE ASSEMBLY OF MANITOBA March 27, 1997 be addressed and those were addressed, but in an overall sense the processes that were followed by the bond corporation, by the review committee, by the department were ones that were proper. Let me also indicate that this is a grassroots program where we involve people from the community on a Grow Bond board. Now, we do not go into a community and begin the process of appointing people to a Grow Bond because, as the member for Crescentwood (M r. Sale) says, these might be our friends. Indeed, we let the community do that.

Before we get into any kind of due diligence on a project we go to the municipality and we ask the municipality to give their blessing to this project in their community. It happened in Portage Ia Prairie, where indeed the-well, the member shakes his head from his seat but, you see, he does not know and therefore he fabricates. Mr. Chair, the community and the council did pass a resolution- Point of Order Mr. Sale: The word "fabricates" is clearly unparliamentary. A case in point, Mr.

Chairperson, the Auditor's Report simply says that the Woodstone Grow Bond was approved before the Grow Bond corporation was put in place. That was the procedure that was changed because of that issue. So do not put untruths on, and take back the unparliamentary words you used. Mr. Cha irperson: Order, please. Just one moment. I am having a little bit of difficulty with the point of order. Number I, when the member started, I think he started to explain what the point of order was by using the word "fabricate," but then at the end he started to use "untruth," which is unparliamentary.

Could I ask the honourable member to withdraw the word "untruth" from his point of order? Mr. Sale: Oh, yes, I would be glad to withdraw the word "untruth." Mr. Chairperson: I thank the honourable member for that. I would also ask members to choose their words very carefully. It is more how we are using the words that are getting us into trouble today, so let us try and choose our words very carefully, and we might maintain some decorum. The honourable member did not have a point of order. It was a dispute over the facts on the rest of it. *** *( I ISO) Mr.

Derkach: I would to indicate, as well, that what I was talking about was not the bond corporation board. I was talking about the municipality passing a resolution, even before any due diligence was done, that indeed they supported the concept of a project, and supported the department and Manitobans investing in this project through a Grow Bond. Mr. Chair, in addition to that, we also call on a review committee that is made up of people who have some knowledge in business from throughout the province, to give us their approval, if you like, of a project, after due diligence has been done on the project.

Indeed, they have the ability to do due diligence on the project, as well. One of the things that the member keeps coming back to is the fact that information has not been flowing freely in terms of where the project was at. Might I remind him that, although audited statements are supposed to be filed with the Grow Bonds corporation in each community, indeed, it is up to the bond corporation to share those with their members. It is not the department's responsibility to send out audited statements to the bondholders. That is up to the bond corporation.

We have now changed some of the procedures, again on the recommendation of the Auditor, where we are going to be putting into the hands of bond corporations some funds whereby they can use those funds to ensure that the audited statements get into the hands of the bondholders. Now, Mr. Chair, again, this is one of those procedures that the Auditor has commented on that has been followed up with. In addition to that, we knew from the very beginning that all of the bond corporations were voluntary individuals from communities who put their names forward, who had the -

�� --- March 27, 19 97 LEGISLATIVE ASSEMBLY OF MANITOBA 937 best of intentions in the world. But they are volunteers. Some of them may have some experience with Venture Capital programs and Venture Capital projects, but not all of them. Therefore, we have embarked on a training program for the bond corporation. As I have indicated time and time again in this House, this is an evolving program. As we come up against little hurdles and challenges, we will address those . We will address those by working with the Provincial Auditor and working with the people of Manitoba. Mr.

Chair, this member talks about his sincerity in working with and for Manitoba ns. Not that long ago, he placed a phone call to my office. He said in his phone call that he was repr esenting the mayor of Portage Ia Prairie, and that he was representing bondholders who were wanting audited statements about the company. We said that is not our position. So we called the bond corporation. We called the trustee. We called the City of Portage. The mayor of Portage has access to my office any time he wants. As a matter of fact, he is the president of MA UM, and he has access to my office at any time.

So he does not need representation. He can represent himself very well. He can represent his community very well. Then we indicated that the proper place to get the financial statements, the audited statements, would be through the trustee. Then we checked with the trustee. Not one bondholder had requested information from the trustee. So what was the member trying to do? Again, he was putting on an air that he was representing this group of people who had all these concerns, and yet not one of them had made a request to get the financial statements from the trustee. So what am I supposed to make of that, Mr.

Chair? In addition- Point of Order Mr. Chairperson: Order, please. The honourable member for Crescentwood, on a point of order. Mr. Sale: Mr. Chairperson, the minister persists in putting untruths on the record. I did not ever claim to be representing Mayor Carlson with whom I have met and spoken many times on this issue. I did claim to be representing Mr. Ferdie van Dongen who is a bondholder and a former senior staff member of Woodstone Corporation. The minister's staff first said that you get the information from the bond corporation.

The bond corporation said they did not have it, they had shut down their of fice and filed all their records or burned them which is il legal according to his own regulations. They have to maintain them for six years. He then said it was the receiver's job. Mr. van Dongen then wrote to the receiver and did receive the audit statement. So let him stop putting distortions of the truth on the record. Mr. Chairperson: Order, please . I have advised the honourable members that the word "untruth" will not be allowed to be used.

I would ask the member not to use the word "untruth." I would also like to advise members, points of orders are questions raised with the view of calling attention to any departure from the standing orders or the customary modes of proceedings in debate. The honourable members are standing and using this to enter into debate, and that is not what a point of order is all about. If there is going to be a rebuttal to somebody's speech, I would appreciate it if they did it during their opportunity and that is when they are asking their question or during their 40 minutes.

I would ask the honourable member to retract the "untruth" again for another time. Mr. Sale: Mr. Chairperson, I have a difficulty, and I would like to ask for your guidance as the Chair. Members have a duty to speak truthfully. They have a duty to be honourable and to not make false statements.

So when a false statement, which is a very serious matter, because claiming to represent an elected official to an office of the provincial government is a very serious accusation, and when such an accusation which is patently false is made, a member against whom such an accusation is made has very little opportunity apparently under the rules. So I would ask your guidance. What is a member to do when a very serious untruth is put on the record by another member in a way which tends to bring into

938 LEGISLATIVE ASSE MBLY OF MANITOBA March 27, 1997 disrepute the honour of the member whose reputation is being questioned by the honourable member? So I am happy to comply with your requirement that I withdraw the word, but I ask for your guidance. What do we do when members make statements that are very damaging and certainly do not reflect the truth? Mr. Chairperson: Order, please.

I would like to remind the honourable member when I spoke about what a point of order was, it can also be used when a member feels that the member has impugned bad motives or motives different from that acknowledged by another member. So that would be your opportunity on that point of order, but it is not time to enter into debate on what the member had stated. I believe that is what the member had been doing. If you feel that there is a time when somebody is impugning motive, that would be a point of order. * * * Mr. Chairperson: The honourable minister, to continue. Mr.

Derkach: The member talked about being concerned about rural jobs and rural families and, yet, we have seen and witnessed the debate for a week in this House in Question Period with regard to a company in rural Manitoba that has won a bid, fair and square, in terms of a contract. Now, he scoffs at that, and then they began to question as politicians what the capability of this company would be to deliver this service, assuming that no one had checked that out. Mr. Chair, that is the furthest thing from reality because, indeed, this company is prepared and is equipped and is capable of delivering the service.

As a matter of fact, evidence was presented that they have experience through their sister company in delivering that kind of service to people who find themselves in need of that service. Mr. Chair, it continued. This attack on this company continued. I was very pleased that the president of the company, whom I do not know very well, I have met on a couple of occasions, did finally go on radio and did indicate very clearly what the position of his company was and what the capability of his company was. He also made reference to the member for Crescentwood (Mr.

Sale) with regard to the types of statements that he was putting on the record in this House . I think it does bring into question the credibility of the member when, again, in a situation here with a rural company he has put remarks on the record which do not reflect the reality of a situation. With regard to W oodstone, we had been working on the situation as it was unveiling itself with Woodstone for some time.

When you see a company lose money in a particular year-this is a private company, it is not a Crown corporation-we do enter into discussions with the company about how we can resolve the problems and address that kind of a situation so that it does not persist. That is when we try to find alternatives in how a company operates so that indeed it can become a profitable company. *

(1200) The fact that an audited statement goes out is something that we have to address, and it has to go out to the bondholders. So we are making provision for the bond corporation to send out those audited statements, but that would not have changed-how would that have changed the situation with regard to Woodstone? The company which was in difficulty was being worked with not only by my department, because there were many more players in the investment than just Grow Bond. So there were other players who were at the table trying to resolve the issue.

I am not going to come into this House and disclose confidential discussions, confidential negotiations that are going on with a client to the opposition and to the media so then it becomes a public debate. Mr. Chair, the Department of Rural Development does not put out the prospectus. That is the company that puts out the perspectus. In every situation we try to ensure that the proper procedures are followed. As we get down to the company winding down, the member for Crescentwood again comes into the House -

March 27, 1997 LEGISLATIVE ASSE MBLY OF MANITOBA 939 and says that we should not pay out the Grow Bond as per legislation. Our staff met with Labour Canada and followed the process in accordance with the decisions that were made under the law, according to the law. Indeed we want Labour Canada to now ensure that they do their part on behalf of the workers in that community and indeed go after those individuals who have responsibility for the obligations that they have put forward. An Honourable Member: The money is gone. Mr. Derkach: The member said the money is gone.

Well, if the money were not gone the company would still be operating today, and there was no way, there was no legal way, whether the member likes to accept this or not and we checked this out with legal counsel, for us to withhold those Grow Bond holders' investments and to pay out those monies to the workers. As much as I would like to do that, Mr. Chair, let me assure you that under the law of this province and this country we cannot do that-[in terjection] Now, the member persists. He says that is not what we are told. I ask him to check with legal counsel.

I ask him to check with the lawyers and then he will be told what the reality of the situation is and perhaps he can believe them. We have staff in my department, Mr. Chair, who are just simply good working, honest individuals who will give him the information, as the member was when he was in the civil service. I expect when he was in the civil service he did his job as honestly and as accurately as he could, and so do the people in my department. So when he asks for information, we will give him the information as honestly and straightforwardly as we can.

So I do not understand why he does not believe legal counsel, why he does not believe the staff in my department when they tell him something and then he goes to the media and says: I am going to call for a forensic audit because I have some questions about the Auditor. When you start questioning the Auditor, whose responsibility it is to report to this Legislature, then I really wonder about where you are coming from. I know the member for Crescentwood (Mr.

Sale) will say: no, no, I was never questioning the Auditor, but if you read the column in the paper when he asked for a forensic audit over and above what the Auditor has already done, what is one to assume? [interjection] Well, and here we have a Manitoba company that tried to create an industry in our province which would be successful and for all kinds of reasons they were not able to do that. And, yes, we can go back and try and piecemeal all of the reasons that the company went down but that is not going to resurrect the company.

One thing is right and that is that we take the information that is now available to us and that we learn from it so that we do not get into those same kinds of difficulties with other companies if we can avoid it. But it still will not mean that every other company in this province is going to be successful, and somehow the member for Crescentwood believes that the only reason that we allowed the $970,0 00 of Grow Bond money to flow to W oodstone was because these were my friends, or our friends. I have to tell the member, I think I met the principal of that company on two occasions. I think I met Mr.

Mullen on one occasion. I do not have any links to Mr. Brazze ll either. So these were not individuals that I wanted to confer some benefit from the province to for some unworthy reason. Mr. Chair, we were trying to ensure that a company in this province that had a technology that was indeed very innovative, that in my understanding was valuable, would have an opportunity to exist. We bring in professionals to do the due diligence on the company. They come from the private sector.

They come from the Industry, Trade and Tourism department, they come from the Min istry of Finance, they come from my department and the economic development board who come together to ensure that indeed there is some viability to the company that we are looking at and so-[ interjection] (Mr. Deputy Chairperson in the Chair) Now, the member says we did not take their recommendations, but let him go back to the minutes of the review corporation, let him go back to the minutes of the town council where in every case there were approvals, and we followed the advice of the people

940 LEGISLATIVE ASS EMBLY OF MANITOBA March 27, 1997 who were giving it to us, and it was on that basis that we approved the Grow Bond. I am hoping that indeed the new owners of the company will continue to operate that company in this province and in the city of Portage because that will again mean the generation of more jobs. The member makes a statement about Crocus Foods. He says Crocus Foods went down, and then we bought it back. Well, that is not quite true, but maybe because he does not know all of the issues that are surrounding that particular company, he makes those statements. Mr.

Deputy Chair, it is true, in the interest of Manitobans, we did acquire the assets of Crocus Foods, and today Crocus Foods is operating. My understanding is that, in the next short while they will be hiring an additional number of staff, I have been told as many as 15, because ofthe volume of activity that is taking place in that company. Now, once again, we had 25 jobs there. If they add another 15, that would be somewhere in the neighbourhood of 40 jobs in that community, that are important to that communit'J.

Now we are hoping that our investment in that company will not only be returned in terms of the taxes that are paid by those individuals from their labours, but also the taxes that are paid by the company on the products that they use and that indeed the investment will come back to the people of Manitoba many times over, and it will if that company continues to function. *

(1210) It is not any different with Rimer A leo, so there is not some plot to give companies in rural Manitoba special privileges, but we want to ensure that there is a level playing field out there for them, that they can indeed compete for the kinds of services that other companies compete for.

You know, I find it somewhat strange when the members opposite criticize the government for allowing a contract to flow to a company that had the lowest bid, was bonded, is a Manitoba company, is a rural Manitoba company, and they defend a multinational as opposed to def ending a rural Manitoba company that is employing rural Manitobans . I do not understand that, Mr . Deputy Chair, and neither do the people of this province. I have to address the issue of how audited statements flow to the bondholders.

Yes, we have now included a provision for some funds to flow to the bond corporation so that they can indeed have some funds to do those necessary things such as delivering or mailing out the audited statements, but the obligation is on the company to provide those audited statements to the bond corporation. In addition to that, we have recognized the fact that indeed there is a need for the company to ensure that those audited statements do flow to the bond corporation, and that is being followed up with in each and every case. An Honourable Member: Five years. Mr. Derkach: Now, Mr.

Deputy Chair, the member says five years. The program is about four years old right now, it is true, and in the past four years we have learned many things about a Grow Bonds Program. We have tried to keep it successful. To date, we have two companies that have gone down out of 22. We have 20 companies operating. I am hoping that not many more will go down, but we do not know that at this point in time. We are working with some companies very diligently to ensure that they will continue, but there is no guarantee on any of them.

I would be happy in the Estimates process to enter into detailed discussions about any one of these concepts and to discuss them fully to ensure that the end result is for the betterment of that kind of a program for this province. Now, Venture Capital is not a new program in this province. The NDP know it well because they were involved in a Venture Capital company themselves. How many of those companies that were started through their Venture Capital program are operating today as they were put together under that Venture Capital program?

So they know what a Venture Capital program is, and I am not going to criticize their programs, although we could spend a lot of time doing that. But the reality of the situation is that a government attempts to create jobs through the private sector by giving some supports to companies that need those supports, if those companies indeed can prove viability, can prove that they are indeed creating wealth and

March 27, 1997 LEGISLATIVE ASSE MBLY OF MANITOBA 941 creating jobs for their communities and for the people of this province. Mr. Deputy Chair, I would be happy to debate any one of these points with the member for Crescentwood (M r. Sale) in a fair way, where we are not making rash statements about companies when those rash statements are not really in line with the reality, so that, indeed, we are exploring better ways of addressing these situations and these problems.

I have to tell you that I am proud of the staff that I have in my department and what they do with regard to economic development in my department, and if you were to check with Manitobans throughout this province, and I do not care which organiza tion you go to, go to UMM, go to the Manitoba Chamber of Commerce-and, yes, I read with some interest the comments that were made by the member for Crescentwood, I believe, to the Manitoba Chamber of Commerce about their support or their attitude as it relates to the economic development programs of this department. But, Mr.

Deputy Chair, I have to tell you all my department is attempting to do is to ensure that we are there as partners, that we are a catalyst in making companies succeed in the rural parts of this province, because the rural parts of this province need population. They need young people to get back into those communities to make those communities grow and to allow those communities to sustain themselves. That is why we entered into the natural gas program, and, yes, there is a new proposal now before us with regard to the Interlake, and I would be happy to sit down with the member for the Interlake (M r.

Clif Evans), and we have on many occasions, to talk about how we can better address the delivery of services and infrastructure to an area which will provide opportunities for companies to locate, for companies to grow from within, and for jobs to be created. That is all this exercise is all about. We are simply there as a catalyst and as a partner with any organiza tion that wants to do that. I want to reference our round tables. Talk to our round tables, and I ask the member for Crescentwood (M r.

Sale) to take some time and meet with the round tables in our province, in our community, to go into rural Manitoba, meet with them, talk to them, ask them whether they are better off today than they were five years ago or eight years ago, whether their community has a better attitude than it had eight years go, yes, despite some of the failures that have taken place, whether their community is better off today than it was some eight years ago.

I think he will be not necessarily surprised by the answer, but he should smile and be happy about the answer that he will receive, which will be a positive one, because it means that our province is getting stronger, that, indeed, we as Manitobans have something to be proud of, and we should be talking about that pride not only to communities in this province but, indeed, to others in other provinces, as well, because together we can make some very good things happen. So, Mr. Deputy Chair, I know that the member will continue to be critical of the process.

I can only continue to re-emphasize that we will follow the recommendations that were put before us by the Auditor, and we will continue to improve the processes. I mean, improvement is a continuous process. We will always make errors. There will always be challenges before us that we have to overcome. But, as long as we continue to keep our eye on the target and ensure that we continue to improve the processes that are in place today, I think all of us will grow. That is simply a statement that I can make about each and every project that we have out there today.

There are things that we are learning each and every day. There are new procedures that we are undertaking. Will we be successful in all of the bonds that are out there today? I do not know that. I do not know that, but this is a Venture Capital program, and my staff are very diligent in the way that they approach any of the projects that are out there today. I can assure the member that we have a hardworking staff out there who are doing the very best they can for the province of Manitoba. Mr. ClifEvans (Interlake): I just want to make a few comments to the Min ister of Rural Development (M r.

Derkach) and ask him a few questions. I have listened here for over an hour about his discussions with the member for Crescentwood, and the bantering going back and forth with words that were used. I just want to tell the minister that this member and this side of the House have a definite attitude towards rural

942 LEGISLATIV E AS SEMBLY OF MANITOBA March 27, 1997 Manitobans and economic development in rural Manitoba. I want to tell him that. I also want to say to him, he made mention about something that I perhaps did or did not do. The minister knows very well that, when Woodstone or any other project was either developing or not developing, something was wrong, this member, this Rural Development critic for the opposition, gave the minister plenty of opportunity to deal with the matter as brought to him by this member. Perhaps, not in Question Period, but in Estimates, in committee, in one-on-one. *

(1220) Point of Order Mr. Deputy Chairperson: The honourable minister, on a point of order. Mr. Derkach: On a point of order, Mr. Deputy Chair, I just want to indicate to the member opposite tha·. what he says is absolutely true. We have, indeed, approached many of the projects in a very positive way with the member opposite. Mr. Deputy Chairperson: Order, please. The minister did not have a point of order. It was a point of clarification. I thank the minister for that. * * * Mr.

Clif Evans: Having said that, and sitting with the minister and discussing Woodstone and other Grow Bond issues on one-on-one, I did give the minister an opportunity to be up front, to provide information so that we could work with the minister, so that we did not have to get up politically in the House and deal with a very serious issue. The whole Grow Bond issue is a serious issue for the province of Manitoba, and is an issue that we support, the Grow Bond issue. We have said that all the time. There is a Grow Bond issue in my community of Arborg about which I want to ask the minister.

He has told me the province and the government now want to be catalysts and partnerships in with it. They are going to follow the Auditor's suggestion. I have given the minister in committee, I have given the minister in meetings, an opportunity to work with myself, and with members on this side of the House, on dealing with the issues that have come forth, that perhaps are not what they should be, are not following the proper guidelines, the proper regulations, or the law itself. I have given him that opportunity. The minister has always told me, always said to me: everything is fine, Clif; no problem.

Everything is fine. You have said that to me. I take that at word from the minister. I am concerned, too, very concerned; not just the member for Crescentwood (Mr. Sale), we are all concerned about it. I think that when, we are dealing with rural economic development and the future of rural Manitoba, no matter where it is-southern Manitoba, northern, Interlake, western-it does not matter. When there is a problem with such an important piece of this province, we should be working more co-operatively.

The minister should be more responsive and co-operative with us, not in this venue but on a one-on-one, so that we can be made aware, so that perhaps we can make suggestions, so that the minister can be up front with the issue. That is what I am saying. The minister knows well. He knows that I am here, we are here, not to stand up and bash a program, if it is working and if everything is going well. When things do not go well and issues are brought up, this minister, this government should respond and react to the questions and the concerns that we have on this side of the House.

I want to ask the minister, if he is being co-operative and if he says that now the department is going to be working diligently with these Grow Bond issues, I want to ask the minister if he can provide me with an update on how Gilbert International is operating, how its finances are, whether it is operating at capacity, whether he knows that and whether he can provide me with that information now. What is the status of Gilbert International? Mr. Derkach: Mr. Deputy Chair, once again, I have to thank the member for the Interlake because, indeed, in a general sense, he has been very forthright in his approach.

He has been very supportive of what our communities are doing, and what businesses in rural Manitoba are doing. I think he is an exemplary critic

March 27, 1997 LEGISLATIVE ASSEMBLY OF MANITOBA 943 for Rural Development because he involves himself in rural development activities and has on many occasions been there on a first-hand basis to see what communities are doing and what municipalities are doing. He has often been at municipal functions and has spent some time in rural Manitoba understanding what this province is really all about. So I give him a lot of credit for that. Mr. Deputy Chair, I want to say that the company he asks the question about in his community is an important one to that community. It is an important one to our province.

It is a company that has grown very quickly in terms of the investment that has been placed into that company. There are many players who are involved in that company. I do not think it is a secret that we have one of our major grain companies now involved as a major player in that company. In its growth, there have been some growing pains that have been experienced, and the member knows about those.

That is how we have been able to bring partners to the table, investment and equity partners to the table, to ensure that that company can continue, will continue, that there is indeed an adequate amount of capital invested in the company. But the officials from my department have been working with it on a continuing basis to ensure that every opportunity for progress is given to it. I am told that the future looks quite bright for that company, that indeed there is a demand for the product that they are now producing.

They have changed, as the member knows, their line from the mini-quiche line to, I think it is, more of a meal line in terms of potpies which are now-there is some demand, there is an extreme demand for in some of our larger chains that deal in foods. So the window certainly does look bright from the information that I have been given. However, that does not mean that all of their challenges have been turned into opportunities and there are not any more facing them. There are hurdles that have to be overcome. But, in respecting client confidentiality, Mr.

Deputy Chair, I would not want to get into the detailed discussions about Gilbert or about any other particular corporation because they are private companies operating in a private f

Document details

Collection	Manitoba — Debates (Hansard)
Citation	36-3-19
Type	hansard
Volume / chapter	36th 3rd hansardpdf 19.pdf
Language	en
Format	pdf
Source	PROVINCIAL
Identifier	988af93a7b239df5f07d66b30627fc6c6b0286e7

Source file is stored in the law ingest library (pdf).