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September 27, 1982

32nd Parliament, 2nd Session

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Hansard Transcripts

MEMBER'S APOLOGY

LEGISLATIVE PAGES

STATEMENTS BY THE MINISTRY

NIAGARA RIVER POLLUTION

ORAL QUESTIONS

WAGE AND PRICE RESTRAINT PROGRAM

METROPOLITAN TORONTO POLICE PRACTICES

WAGE AND PRICE RESTRAINT PROGRAM

EXTRA BILLING

METROPOLITAN TORONTO POLICE PRACTICES

SHELTER ALLOWANCES

INTERNATIONAL HARVESTER

METROPOLITAN TORONTO POLICE PRACTICES

ABITIBI-PRICE WAGE CUTS

WINDSOR PACKING

ORDERS OF THE DAY

INFLATION RESTRAINT ACT (CONTINUED)

The House met at 2 p.m.

Prayers.

MEMBER'S APOLOGY

Mr. Gillies: On a point of privilege, Mr. Speaker: I might have wished that the member for Downsview (Mr. Di Santo) were in his seat for this point of privilege, but I do not see him here. I will proceed anyway.

Last Thursday, during question period, I made a remark here in my seat for which I cannot correct the record because it did not make the record. None the less, for this interjection I feel I owe both an apology to the member for Downsview, and an explanation to the House. I did speak privately to the honourable member on Friday and I think everything is fine between us. None the less, an explanation is due.

The remark I made, which as I recall as "Translation required" or "Translation needed", something of that sort, was made at the time the honourable member was retelling an anecdote about election promises.

I want to make two things clear to the House on this point. The intent of my remark was certainly not, in any way, a slur. It was more in the vein of, "What is the honourable member talking about?" rather than "What is he saying?" I want to make that very clear.

The other point is it has been recorded in certain of the media that my interjection was made at a time when the honourable member was asking a question of some import to the injured workers of the province. This is completely untrue. I want to make it very clear that my interjection came at the time he was telling his anecdote at the beginning of the question, and not at the time he was addressing a question of such importance to the injured workers of the province.

Despite all this, the important

part is that no matter what the intent, the levity or gravity of my remark, I fear that I may have caused injury or insult to the honourable member. It was the last thing on my mind. He is a man I hold in the very highest regard and to him I offer my most sincere and abject apology.

LEGISLATIVE PAGES

Mr. Speaker: Before carrying on with routine proceedings, I would ask all members to join with me in recognizing the following legislative pages:

Cheri Bradish, Middlesex; Alyssa Clark, Carleton-Grenville; Dominic Dowd, St. David; David Dowey, Brampton; Sam Gauvreau, Sudbury; Sandra Glista, Mississauga South; David Hunt, Brock; Nicole Laframboise, Beaches-Woodbine; Sharon Leighton, Scarborough Centre; Alex MacFarlane, Lincoln; David McLaughlin, Hastings-Peterborough; Steven Mock, Algoma; Tracy Ryan, Essex South; Christine Schiller, Wentworth North; Marisa Sterling, York Mills; Sheri Varley, Huron-Middlesex; James Verner, Kingston and the Islands; Paul Visser, Durham West; Emma Waverman, St. Andrew-St. Patrick; Dianne Zdybal, High Park-Swansea; Mark Zwegers, Kitchener.

STATEMENTS BY THE MINISTRY

NIAGARA RIVER POLLUTION

Hon. Mr. Norton: Mr. Speaker, as the honour- able members are probably aware, negotiations are now under way between the United States Environmental Protection Agency and Hooker Chemicals and Plastics Corp. concerning the control and cleanup of certain chemical wastes deposited by the company in sites in the Niagara Falls, New York, area. This is one of the contaminant source areas being studied by the Niagara River improvement team that was set up in the ministry in November 1981.

I said then that we would not hesitate to intervene in the US proceedings when this action would contribute to the cleanup of the Niagara River. I have instructed my ministry's legal staff to prepare a submission to the United States district court in western New York requesting intervener status in the negotiation concerning one of these sites, which is presently under way. We expect the submission to be filed with the court that is presiding over the negotiation within about two weeks.

Our major concern at this time is the S area site adjacent to the company's plant in Niagara Falls, New York, about 200 yards from the Niagara River. Intervener status is necessary for us to gain access to all of the information on the S area site, including confidential information, so we can evaluate fully the effectiveness of any proposed corrective measures.

The waste products from the manufacture of more than 250 chemicals were dumped in this site between 1947 and 1975. We estimate that a total of more than 70,000 tons of wastes have been placed in this and the adjacent N area sites, including wastes from the production of caustic soda, chlorine, chlorotoluenes, Mirex and halogenated organic chemicals, among other products.

The consulting firm of Geologic Testing Consultants in Ottawa, retained by our Niagara River improvement team, has completed a hydrogeologic report on the Hooker S area, which we are sending to Environment Canada, the EPA and New York state, and which I would like to table in the House today.

The report draws these conclusions:

First, the ground water in the fill area used to reclaim sections of land from the Niagara River and the sediments immediately below that fill are heavily contaminated with organic chemicals originating at the S area site.

Second, the ground water flow direction in this upper layer of the fill is primarily southerly towards the Niagara River. There is also a downward flow of water into the underlying Lockport dolomite or limestone.

Third, the upper 10 to 15 feet of Lockport dolomite contain relatively high concentrations of organic contaminants as well. The ground water in this rock layer moves initially north and then turns westerly to the Niagara gorge downstream of the falls.

2:10 p.m.

Fourth, there is a reasonable potential for some of the organic contaminants to move south towards and beneath the Niagara River, in the direction of the Canadian side.

As you can see, we regard the situation in S area as serious. Contaminants from the site have entered the ground water and have access to the river.

Our intention, as an intervener in these negotiations, is to make sure that the concerns identified in this study, and in our other monitoring activities, are resolved in any agreement developed for remedial action on the site.

I would add that our participation as an intervener at this stage would not, if the agreement does not meet our requirements, preclude our further involvement should the matter end up before the courts in the further part of this process.

I will keep the honourable members of the House advised about our continuing activities both on the S area site as well as others relating to the clean up of the Niagara River.

I would add that there are copies available for members, such as the critics, the opposition leaders and other interested parties if they would like to notify us.

ORAL QUESTIONS

WAGE AND PRICE RESTRAINT PROGRAM

Mr. Peterson: Mr. Speaker, I have a question for the Minister of Consumer and Commercial Relations. The minister sent a letter to his cabinet colleagues with respect to the criteria for his program, saying: "The cabinet committee has access to an independent review by the new Inflation Restraint Board.

However, our intention is to minimize the administrative costs of this program and to use the excellence of the existing regulatory process to apply the relevant criteria in the first instance." Could the minister please clarify that and tell me the answer to this question: is the minister asking his fellow ministers to request the agencies under their control to comply with the guidelines, or is he saying they should be ordered to comply? What are the rules?

Hon. Mr. Elgie: Mr. Speaker, I would hope it was clear that what we are saying to each minister is that all prices that come within his control or supervision are to come within those guidelines. On the particular reference that the member made: for example, if I was to refer to the Minister of Energy (Mr. Welch) -- and I hesitate to refer to him because he is such a lovely young man -- but if I was to refer to him and to his ministry that he runs with such dedication and capability --

Mr. Swart: You ought to watch that colleague of yours.

Hon. Mr. Elgie: You agree with that, do you? Then I would say, and take this as an example, the Ontario Energy Board reviews the details of gas applications in great detail. I am simply telling him that process is to continue. The Ontario Energy Board is to continue examining the details and putting it to the close, careful scrutiny that they usually do. Following that careful scrutiny, if the Minister of Energy is not satisfied that it comes within the guidelines, he is to refer it to the cabinet committee.

Then that cabinet committee, having all that information available to it, will review that documentation and the raise that has been recommended. If it is not satisfied, it can do one of two things: make a recommendation to cabinet or it can refer it to the Inflation Restraint Board for their review and consideration.

Mr. Peterson: Would the minister not agree with me that he is now creating and introducing new measures into the implementation of this legislation. He is creating a lot of confusion. I gather he has four levels of boards, groups and agencies. I understand his fondness for boards, agencies and commissions in his government, but now he has the Inflation Restraint Board and he has the ministers responsible for various regulatory agencies, cabinet committee and full cabinet, all of which can be involved in the setting of the rules somehow or other.

We have yet to understand what the rules and the criteria are and who is responsible for what. That is not clear in the legislation, it is not clear in his letter and it is not clear from what he said today. People may want to appeal but they may not know how, whether they appeal directly to the minister or to someone else. There is so much ministerial discretion involved in this whole matter still that it appears to me the minister is creating the seeds for failure of a program that he wants to succeed.

Hon. Mr. Elgie: I do not sense the confusion that the Leader of the Opposition seems to, over responsibility and criteria and the outline of responsibilities and guidelines; I think it is very clear.

In the case of the Minister of Energy, for example, he has obligations with respect to those prices that come directly under his control. He has responsibilities to make certain that the guidelines are followed with respect to agencies that are regulated by a subsidiary of his. If he is not satisfied that the prices come within those guidelines, he may then refer them to the cabinet committee, which may then determine whether or not to take direct action, through a recommendation to cabinet, or to refer it to the Inflation Restraint Board. I do not understand where the problem is. To me it is a very simple and straightforward line of authority.

Mr. Foulds: Mr. Speaker, why is it that the government, through this legislation, gave the discretionary power to a minister, such as the Minister of Energy, to decide whether or not an increase was too great, and therefore he has the power to refer it to the cabinet committee, and did not give the same discretionary power to the Minister of Labour (Mr. Ramsay)? It simply slapped on an arbitrary five per cent on the workers of the province,

whereas it did not do that on the price side. Why is the government so soft; why does it use the velvet glove when it comes to the price side and the iron fist when it comes to the wages side?

Hon. Mr. Elgie: Mr. Speaker, as I said the other day, I do not think there is anybody in the room who does not wish that one could just wave a wand and say that prices will be no more than such-and-such per cent, but the reality of life is that there are only certain things we can control, that come within our control.

One is to make certain that the wages that are passed through as a component with the price come within the guidelines -- the five per cent. Second, that if the profit margin on common equity shares goes up by more than five per cent, then we deal with that.

As the member knows and I know, there are costs -- like the cost of gas -- that are beyond our control because of the Alberta, Saskatchewan and Ottawa agreements, and because of the fact that TransCanada PipeLines have been allowed a certain increase that is beyond the federal government guidelines. There are certain costs, my friend, that we just have no control over. We cannot arbitrarily banish them from the world, they are there and they have to be passed through; but those things that are within our control we are dealing with.

Mr. Conway: Mr. Speaker, to the new czar of price and incomes control: In respect to the same press report in the Saturday Globe and Mail, I want to ask the minister to comment on the apparent contradiction between, on the one hand, the Premier's (Mr. Davis) statement here last Tuesday: "in keeping with these directives to significantly reduce our current fiscal account, Management Board is currently working with all ministries in order to reduce their operating budgets;" and a statement of the Management Board official who is quoted in this particular

article as saying that there is no process, either yet determined or yet in place, to bring about these very reductions.

Can the czar of price and incomes control tell us if he is aware of a process and procedure yet determined and yet in place to control the likes of Malcolm Rowan in spending this government and this province into the seventh heaven of fiscal irresponsibility?

The fact of life is that each of these ministers here will tell the member that in the past three or four months he or she has already gone through two restraint periods. They have already had two occasions on which they have had to restrain their budgets. That process will continue, and will continue in the allocation process as we head for the 1983-84 budget process. It does not mean it will always be possible because there are certain public needs that have to be provided for.

Let me assure the member -- and there is nobody who doubts this in spite of the beautiful, eloquent way in which he expresses his question -- there is nobody who doubts this government has achieved far more than any other government in this country in restraining its budgetary activities.

2:20 p.m.

Mr. Conway: What does the minister think of Peter Worthington?

Hon. Mr. Elgie: I think he is a lovely man. I wish he was somewhere else.

METROPOLITAN TORONTO POLICE PRACTICES

Mr. Peterson: In the absence of the Attorney General (Mr. McMurtry), Mr. Speaker, I have a question for the Solicitor General, given the fact that he has the ultimate responsibility for the conduct of the police force. I would like him to explain this to me, if he may.

On September 7, the Attorney General is quoted as saying, with respect to the Proverbs' tapes: "Allegations by Neil Cameron Proverbs of illegal actions by police and of corruption in high places are 'totally without any substance.'" Further he said: "I am advised by my crown law officers that the police have reviewed all these allegations to determine if there was any substance or could be any substance in any of them. And I'm told that, again through my crown law officers, that the view of the Metropolitan Toronto Police was that there was no substance to any of his allegations."

Those quotations are attributed to him on September 7. Within hours of the story hitting the press and the Toronto Star hitting the news-stands, the Attorney General said this: "I want to inform you that I have asked the Ontario Provincial Police to investigate every single allegation and innuendo made by Mr. Proverbs or the officers with whom he met." He goes on to say: "I want to state that I am profoundly distressed by the alleged activities of the two police officers in this matter. I do not believe their actions were in the interest of justice, the police force or the public."

I would like to ask the minister to explain this road-to-Damascus conversion of the Attorney General. Why did he change his mind on this very serious matter?

Hon. G. W. Taylor: Mr. Speaker, I am sure the opposition can address those questions to the Attorney General as they are quotes attributed to him. I am not always sure that quotes attributed to him are correct. The Attorney General is frequently present in this Legislature and those questions can be addressed to him.

Second, the matter is at present under investigation and there are charges flowing from that. I think it would be most inappropriate and improper for me to comment on a case or on facts that are at present before the courts.

Mr. Peterson: This is a typical stonewall that the minister is now getting conned into being involved in himself. There was a major change of position, very different views were expressed. I am not aware that there is anything before the courts at this point. Perhaps it is being investigated, but I am not aware of any charges relating to these tapes that are before the courts. The minister may have some information I do not have, and he may want to argue the sub judice rule, but I do not think that is at all relevant to the question I asked him. He is ultimately responsible for the conduct of the police in these matters, which is very much the subject of my question.

I would ask the minister, and I assume he was involved -- is he the Solicitor General or is the Attorney General still the Solicitor General? If this minister is the Solicitor General, then I think he should be informed about these matters and I would like an answer to the question I just asked him about the major flip-flop and change in position by his government.

Hon. G. W. Taylor: There has not been any change. The statements attributed to the Attorney General can best be explained by him. I do not think that the member opposite need have any concern about who is the Solicitor General. I am the Solicitor General, and I am responsible for the police, as the member said, but there is an ongoing investigation in this matter. When there is an ongoing investigation, it is better to speak on these matters after the investigation has run its course and has completed examination of the material before it.

Mr. Renwick: Mr. Speaker, I have a supplementary question of the Solicitor General. Has he given any consideration to referring the matter to the public complaints commissioner, as I have done and as the Canadian Civil Liberties Association has done, on the allegations made by Mr. Proverbs, particularly the allegation with respect to the shaping of evidence by witnesses before the courts? If not, will he do so?

Hon. G. W. Taylor: Mr. Speaker, until the investigation is completed by the Ontario Provincial Police and I am able to see its full documentation, I will reserve judgement on whether to refer it to the police complaints operation at that time.

Mr. Peterson: It is no secret the police had access to these tapes for some considerable period of time before the whole matter became public. In fact I understand one of the people who reviewed those tapes and advised the Attorney General there was no cause for concern was one John Takach, the director of crown attorneys. The minister is aware of the facts in this matter, I assume.

He is aware of course that Mr. Takach, the same person who gave the Attorney General the advice there was absolutely no substance in what was contained in the case, is now the adviser to the police in their own investigation. How can a man like that be objective? This is the minister's police force that is involved in this investigation, getting advice from Mr. Takach and Mr. McLeod, presumably the same gentlemen involved in the original decision that there was no substance in the allegations. How does the Solicitor General respond to that and how is he going to maintain the integrity of this entire investigation?

Hon. G. W. Taylor: Mr. Speaker, the Ontario Provincial Police, amongst other attributes, is a police force of integrity. It will complete the investigation with all due dispatch and in its most professional manner. When the investigation is completed, the law officers of the crown will review the material to see whether any charges are warranted.

WAGE AND PRICE RESTRAINT PROGRAM

Mr. Foulds: Mr. Speaker, I have a question for the Treasurer. Can he confirm my

interpretation of Bill 179? Can he confirm that the arbitrary powers of the Inflation Restraint Board include the following five: One, the right to not hold any hearing whatsoever on any matter referred to it; two, the right to make any order, decision or determination without any hearing and without giving any reason, written or otherwise, for the decision; three, the right to deny any increase at all for the so-called transitional period when a dispute is referred to it. Therefore, the so-called nine per cent solution could be a zero per cent solution if Jack Biddell so decides.

It is my impression a fourth power is that the board, for a collective agreement that expired before October 1981, has the sole right to determine unilaterally the increase which could be as low as zero per cent. Finally, a fifth is that the board has the right to award non-unionized public sector workers an increase of as little as between zero and five per cent in the control year itself. Can he confirm whether these five immense arbitrary powers are within the purview of Bill 179?

Hon. F. S. Miller: Mr. Speaker, I believe the member is correct on each one.

Mr. Foulds: Can he then explain why the board, in making its wage determinations under these immense arbitrary powers, does not have to conform to any criteria whatsoever, since none have been set in the legislation and none have been indicated as being forthcoming by him or his government?

Hon. F. S. Miller: I think a question like this was asked on Thursday or Friday morning -- I am not sure which day. We stressed that for a one-year period strict measures were going to be taken. No one was trying to claim they were totally equitable. However, in the interests of avoiding a very large bureaucracy, we had set our overall parameters: five per cent for the control year for salaries under $35,000, plus merits under that limit, and five per cent on all other salaries. We decided that in the transition period there would be none greater than nine per cent but there would be some flexibility to look into that.

If the member feels we can write down every possible variation that may come before that board and give hard and fast criteria in advance, so be it. I suggest to him that a good deal of the tradition of our very system has been based upon commonsensical decisions made within broad parameters and criteria rather than very specific predetermined ones.

With a person like Mr. Biddell, who has had a good deal of personal experience with the Anti-Inflation Board, I believe we are going to see wisdom brought to this process, and fairly speedy and fair decisions, in so far as they can be fair within the system.

2:30 p.m.

Mr. Wrye: Mr. Speaker, considering the sacrifice which this legislation asks of the public sector, does the Treasurer not agree that it would have been appropriate to set up a cabinet committee, perhaps chaired by the Minister of Labour (Mr. Ramsay), which would have allowed public sector workers, some of whom may find that the increases in their contracts, which will go back to the pre-October 1981 period, are inadequate, the mechanism of a final appeal should they find that those increases are unjust in their view?

When the bill goes to committee, will the minister ask the Premier (Mr. Davis) to consider setting up such a cabinet committee, which would give the workers some small feeling that perhaps there is a little more justice in the government's actions?

Hon. F. S. Miller: Mr. Speaker, for those older contracts that go back for more than one year, one will find a good deal of fairness played. If I am not wrong, we are dealing with some 60 contracts that predate the October 1981 date, and only something like 0.2 per cent of all the employees are caught in some fairly old, unexpired contracts. We had to have some mechanism for resolving them.

Mr. Foulds: Two thousand people.

Hon. F. S. Miller: I was told it was 0.2 per cent. My friend may work that out and tell me. That sounds like a little more than 0.2 per cent to me. There are an estimated 500,000 employees. One per cent would be 5,000, and that is about 0.4 per cent for the figure the member gave us.

Mr. Wrye: Well why not protect those 1,000 people?

Hon. F. S. Miller: "Protect" is a very interesting word. I think the very steps we are taking are aimed at the maximum protection, not only for those people who have wage and job security within government areas but also for the rest of society which has not got that kind of protection.

Mr. Foulds: Is the Treasurer now admitting before this Legislature that there are inequities in this legislation? Is he admitting that he is willing to condone those inequities when it comes to the wage side but that his colleague the Minister of Consumer and Commercial Relations (Mr. Elgie) is not willing to condone any inequities when it comes to the prices side and wants them to be allowed to pass through all their additional costs?

Can the Treasurer further confirm that, contrary to the Premier's assertion in a statement to this House, there is no provision in this bill for collective bargaining on nonmonetary items, by the simple fact that the contracts are continued in force it is entirely up to the employer to decide whether he will talk about any nonmonetary items; and that, contrary to normal practice under the Ontario Labour Relations Board, he does not even have to return a phone call from the bargaining agent for the workers when it comes to such things as the shift system, health and safety, work load or grievance procedure'?

Hon. F. S. Miller: On the last one, I think the honourable member is exaggerating a bit. Obviously, the Premier has said, and the legislation foresees, that there will be discussion and negotiation on non-wage-related items.

Second, the idea that there is total equity in the system was dispelled at the beginning. We never claimed there was total equity. In fact, we said just the opposite, that you could not have this kind of action taken and have total equity.

Mr. Peterson: Don't compound it.

Hon. F. S. Miller: We are simply saying that we have done the best we can, recognizing that no freeze or reduction of ceiling can ever equitably hit all people. I look at the teachers who have settled their contracts by September 1. I would bet there were not too many that were less than nine per cent. Those who chose to stay out or who had not signed by September 1 will have "a less equitable answer" than those who signed.

Mr. Wildman: The boards chose not to sign, too.

Hon. F. S. Miller: I am just saying that we cannot make major moves of this nature and foresee or prove or guarantee equity. I suggest, though, it is wrong to attempt to say that we have harsh justice on the one side for wages and no justice on the other side for prices. My colleague the Minister of Consumer and Commercial Relations spelled that out clearly, simply and objectively.

EXTRA BILLING

Mr. Foulds: Mr. Speaker, I want to ask another question about equity, equality and justice. This is not even rough justice; it is roughness. Can the Treasurer explain why the government's so-called restraint program did nothing to stop extra billing by the doctors, which cost the patients of Ontario $64 million last year?

Hon. F. S. Miller: Mr. Speaker, I do not know what percentage of the doctors are opted out. I think it was something in the range of 16 per cent the last time I heard a figure. The Minister of Health (Mr. Grossman) could verify it.

Under the present system in Ontario, a doctor is either opted in or opted out. We did not change that in any way. Extra billing has been part of the system, and I very much believe it should remain part of the system. I sincerely hope the physicians of Ontario will not take actions that will rule out that difference. That is one of the key differences between a total state system and the system we have.

Mr. Foulds: Speaking of state systems, can the Treasurer explain why he and his government are willing to impose arbitrary agreements on 400,000 unionized workers and 100,000 non-unionized workers but are unwilling even to make the 15,000 members of the Ontario Medical Association abide by the terms of the agreement they signed voluntarily, let alone allowing them to continue to extra-bill?

Why does the government allow the medical profession to have it both ways? They signed an agreement, yet the government allows them to extra-bill. Every time they extra-bill, they break the agreement they signed; they break their contracts. Every worker on whom the Treasurer is going to impose the five per cent solution would love to have that opportunity.

Hon. F. S. Miller: The honourable member is totally off base. Nothing is abrogating that agreement. Not all doctors have to take the government's fee as paid; those are the opted-out physicians. They have been that since the day the plan was formed, as far as I know. At times there have been pressures both ways: (

a) to opt out all the physicians, from the physicians' point of view; and (

b) to opt them all back in, from the benches opposite.

I suggest that we have had a fair system. There are rights for both the patient and the physician in society. There are rights for a physician who may be the most senior in his category just as there are for lawyers, school teachers and all other groups to say that for a specific function he or she is worth a little more. That is the opting-out privilege.

Mr. Peterson: Mr. Speaker, with the provisions of Bill 179 the government is controlling administered prices and is doing that in the time frame known as the administered price restraint program. Can the Treasurer please tell me why an increase in Ontario health insurance plan fees is not an administered price and why it does not fall in the time frame for the legislation when it comes into effect on October 1, the day the programs starts? Why is this excluded?

Hon. F. S. Miller: Mr. Speaker, I think there is a

section in the act that talks about budgetary or tax measures. One can argue for some time as to whether OHIP is an administered price. If the Leader of the Opposition can help me solve the other side of that equation, the cost of the health care system, he will do me and this House a very large favour. I can just suggest to him --

Mr. Peterson: Do you call it a tax?

Hon. F. S. Miller: The honourable member knows we have a paper out at this point asking for a review of the alternatives to OHIP premiums. People think of a premium in the normal sense of the word as the price attached to a risk that covers the full cost of that risk. It is supposed to be true of any other kind of insurance. The member knows it covers a little less than one fifth of the cost of the health service provided. It is scarcely a premium; it is a source of government revenue.

I wish to point out one more fact. It was May 13 when historically the rate was changed to cover the increases in OHIP for the last year. For all the talk on the far side about health care going to the dogs, health costs exceeded 17 per cent growth last year and I am told hospitals exceeded 20 per cent growth last year. That has to be reflected in the cost of the system. It was announced May 13. We bill a full three months ahead -- I am sure the member is aware of that -- and because of the intricacies of the billing system the first effective date it could come into place was October 1. That was named on my budget day.

2:40 p.m.

Mr. McClellan: Mr. Speaker, I asked this question of the Treasurer last week and he refused to answer. Since we are on the eve of the government's meeting with the OMA, I hope he will answer the question today; it is a very simple one.

Is it not a fact that the OHIP

schedule of fees, which establishes the fees payable to doctors for services provided to their patients, falls under the definition of an administered price according to subclause 26(a)(ii) of Bill 179 and is administered by OHIP, a public regulatory agency under clause 26(

d) of Bill 179? If not, will the Treasurer kindly explain how he managed to exclude OHIP from the act when the language of the act is absolutely clear that OHIP is covered?

Hon. F. S. Miller: Mr. Speaker, when we get into the act itself on a clause-by-clause --

Mr. McClellan: Answer yes or no.

Hon. F. S. Miller: I am not going to answer yes or no because the member yelled that from his seat. If I answer yes or no he will tell me I do not give him enough information.

Mr. Cooke: Don't you know the answer to the question?

Hon. F. S. Miller: It happens I do not know the answer to every question in the world. I am not like the honourable member.

Mr. McClellan: Mr. Speaker, I have asked this question twice --

Mr. Speaker: Order.

Mr. McClellan: -- and it is preposterous for the Treasurer to say he doesn't know the answer to the question.

Mr. Speaker: Order.

METROPOLITAN TORONTO POLICE PRACTICES

Mr. Conway: Mr. Speaker, in the presence of the Attorney General, I want to pursue a line of questioning that was initiated by my leader a few moments ago with the Solicitor General (Mr. G. W. Taylor). It concerns the very worrisome contradiction about his reaction before and after the publication in the Toronto Star of the tapes concerning the activities of Mr. Neil Proverbs.

The Attorney General, as the chief law officer of the crown, will appreciate that his position in this matter is of genuine importance to this Legislature and to the public at large. Can he help us in understanding why it was that prior to the publication of those allegations derived from the tapes in the Toronto Star, statements were attributed to him on September 7, 1982, as having said that allegations by Neil Proverbs of illegal actions by police and of corruption in high places were totally without any substance." The Attorney General went on to indicate, prior to the publication, that he felt this way upon a careful examination of these matters, assisted by his crown law officers.

Then, shortly after the publication in the Toronto Star, he indicated: "I want to inform you that I have asked the Ontario Provincial Police to investigate every single allegation and innuendo made by Mr. Proverbs or the officers with whom he met... I want to state that I am profoundly disturbed by the alleged activities of the two police officers in this matter. I do not believe their actions were in the interest of justice, the police force or the public."

The allegations were totally without substance prior to their publication, and lo and behold, upon their publication, there was an immediate inquiry because the Attorney General felt their actions did not serve the interest of justice, the police force or the public. What changed his mind in the intervening couple of days?

Hon. Mr. McMurtry: Mr. Speaker, I am sorry I missed the earlier exchange between the Leader of the Opposition (Mr. Peterson) and the Solicitor General. I doubt that I missed very much, but in any event I am happy to pursue it at this time.

Interjections.

Hon. Mr. McMurtry: The Leader of the Opposition has traditionally demonstrated some difficulty in understanding issues relating to the administration of justice.

I just want to make it clear that there was no change of heart, no change of mind. I think there was some confused reporting as to what was said-Interjections.

Hon. Mr. McMurtry: Well, I trust that any time the honourable member is ever quoted in the press he will assume that every word is precisely as he stated it.

I attempted to clarify this matter a little bit in a letter I wrote some days ago to the Toronto Star. The situation was simply this. The existence of approximately three and a half hours of tapes had been known to the law officers of the crown for some time. Before the Star's publication, an internal investigation had been proceeding and, to my knowledge, it was still proceeding on the date of the publication.

What I said to the Toronto Star reporter on the telephone was that as of that date I had been told by my crown law officers that they had not been able to confirm any of the allegations and that there was nothing to warrant a royal commission but that the investigation was continuing.

As I pointed out to the Toronto Star upon the publication and the understandably wide publicity that was given to the very unusual circumstances -- and one obviously could expect a great deal of public interest -- notwithstanding the fact that I had great confidence in the ability and the credibility of the internal affairs branch of the Metropolitan Toronto Police Force to conduct a complete, impartial and objective investigation, it was in the interests of the Metropolitan Toronto Police Force, in my view, to have the Ontario Provincial Police take over the investigation.

I pointed out at the time that it was not by reason of any lack of confidence on my part or on the part of my law officers in the integrity of the internal affairs branch of that police force.

We knew, of course, that this matter would become a very public issue at some time. Quite frankly, I had hoped the charges against Mr. Proverbs would have been disposed of before, because obviously in this whole issue we cannot lose sight of the fact that Mr. Proverbs is facing a criminal charge which is scheduled to proceed to trial in October; that fact in itself, of course, inhibits us a little bit as to just what we can say about this matter.

I just want to reiterate that there was an ongoing investigation at the time the news story referred to by my friend across the aisle was written and that as of that date I had been advised that internal affairs had not been able to come up with anything of substance in relation to the allegation; but the investigation was going on and is still going on.

Mr. Conway: So that I will be clear in my own mind, is the Attorney General now stating that he never said to anyone at the Toronto Star, as he was quoted on September 7 as having said, that the allegations were "totally without any substance"? Is he now denying that he ever said to anyone at the Toronto Star that those allegations, such as he knew them then, were "totally without any substance"? That is a direct quote, and I want his direct response to that if I might have it.

Will he help us as well to understand the chronology between September 7, when apparently he was first confronted by the newspaper with a limited amount of the material, and the position he went on to outline in his letter of September 16? What specifically happened to him in the intervening nine days such that he had a very different attitude as expressed in his letter of September 16? Can the minister indicate, in answer to the second part, whether along the way he had taken into his confidence either Mr. Rod McLeod or Mr. Takach?

2:50 p.m.

Hon. Mr. McMurtry: I repeat what I said before. Absolutely nothing had changed. I indicated to the Toronto Star that as of that date, and I repeat it again today, that a very careful investigation of the allegations in these tapes with respect to a number of judges and other individuals had been unable to confirm any substance to those allegations. That is what I said then and that is what I say now. I repeat: The investigation was ongoing and it is still ongoing. I do not know how I can make myself any more clear than that.

SHELTER ALLOWANCES

Mr. R. F. Johnston: Mr. Speaker, my question is for the Minister of Community and Social Services.

Since only 14 per cent of general welfare assistance recipients and 18 per cent of Family Benefits Act recipients are living in public housing and, therefore, the vast majority are out in the private market, and since we normally expect people to pick up about 30 per cent of their shelter costs from their total income, is the minister aware that in Ottawa general welfare recipients are paying 55 per cent of their income for shelter and in Brantford 59 per cent, while here in Toronto, according to the Open Door rooms registry, people are paying up to 81 per cent for rooms on the registry and 93 per cent for those listed in the local daily papers?

Does he not think this is an unacceptable amount of money for these people to be spending, and is it not time we had some action from him now rather than waiting till whenever he decides winter begins?

Hon. Mr. Drea: Mr. Speaker, the honourable member is being cute, as he always tries to be. He is talking primarily about people who live in rooms rather than in a dwelling. Is that not correct'?

Mr. R. F. Johnston: Specifically.

Hon. Mr. Drea: It would be nice if he had said it in the first place.

Mr. Foulds: Just answer the question.

Hon. Mr. Drea: Oh ho --

Mr. Speaker: Never mind the interjections, please.

Hon. Mr. Drea: The member for Port Arthur (Mr. Foulds) may be the acting leader of a dying party, but he should not try to give me orders.

To come back to the question: Last year, because of what I regarded as a rather preeminent need, we did move to shelter supplements, but these affect only people with dependants, other than the odd person who may be disabled and is on long-term benefits.

I am looking in particular at the shelter problem for single individuals this winter, both as a matter of shelter and as a matter of seeing what is going on in the rooming house or boarding home industry. I will probably have some things to say about that in the reasonably near future.

However, I point out that traditionally -- and I notice the honourable member did it himself in his continuing saga with his welfare allowance -- people who are single and employable tend to double up in rooming houses and that brings down the cost of the shelter.

The member cheated himself, because he did not take that into account with his budget. But there are still a few days left; he might be able to spend a little bit more on himself.

Mr. R. F. Johnston: Just to clarify the record: I was primarily talking about single rooms, as the minister said. That is why I used the example of the rooms registry, which primarily deals with single rooms. It is true that people double up, but in Toronto they are often charged double as well.

Is the minister aware that Metro Toronto social services department now is approving rents for singles of up to $60 per week, or about $260 a month, which is approximately 100 per cent of the amount -- $266 -- a single will receive in a month? That means they have no money for food. That is why more than 700 men and women lined up at the Scott Mission yesterday for their one meal of the day.

Does the minister not think that is more of an emergency reason to call back this House and to give those people some money than this arbitrary breaking of contracts with his civil servants?

Hon. Mr. Drea: I said I was in the process of formulating some particular programs with agencies and so forth for the winter.

However, I draw to the member's attention -- he started this last year as well, and I am surprised he is not already sleeping in the parking garage to show that there is a shortage of shelter for those who are either transients or who are caught up in the very difficult impact of the recession -- that the number of meals served at this time of the year by various groups that are funded either by Metropolitan Toronto, and therefore through the province or partially by the private sector, really does not have a great deal to do with who is on general welfare assistance, and the member knows that.

They are two separate and distinct matters.

If the member wants me to run a welfare state for rooming house operators, then I can start getting into picking up very high costs in boarding houses, rooming houses and so forth. I do not understand what he means by "Metropolitan Toronto is approving."

Mr. R. F. Johnston: They accept the payments so you can live there for $60 a week, and they then give you a cheque.

Mr. Speaker: Order.

Hon. Mr. Drea: That does not mean that Metropolitan Toronto is approving the rentals.

Mr. R. F. Johnston: Sure it does. They used to not accept them -- or don't you know anything?

Hon. Mr. Drea: Part of the problem for Metropolitan Toronto in that regard is that a number of addresses downtown have disappeared. Indeed, there is a particular shortage in the downtown area, and rather than get into --

Mr. R. F. Johnston: The individual still has the same number of dollars.

Hon. Mr. Drea: I beg your pardon?

Mr. R. F. Johnston: Zero.

Mr. Speaker: Order. Never mind the interjections, please.

Hon. Mr. Drea: Mr. Speaker, I resent that very much, and I am getting a little bit tired of the member and his snide remarks. Nobody has answered a question more directly than I am doing, and I would appreciate the right to continue answering.

Mr. Laughren: You are copping out, Frank.

Mr. Foulds: Take off your glasses and resign.

Mr. Speaker: Order.

Mr. Boudria: Mr. Speaker, can the minister indicate to this House a firm date by which he intends to increase the level of general welfare assistance? Regardless of his argument with my colleague the member for Scarborough West that we are not 10th but are really ninth, or whatever the figure is, with respect to our level of benefits in comparison with those of other jurisdictions and so forth, can he indicate to this House whether he will increase the rate shortly and give us a date by which he intends to do it? There are many people in this province who are desperately waiting for that increase and who are falling farther and farther behind.

Hon. Mr. Drea: Mr. Speaker, as I said the other day, and I trust the member was here, we are reviewing the situation, and I will have something to say about it before winter.

INTERNATIONAL HARVESTER

Mr. Watson: Mr. Speaker, I have a question for the Minister of Industry and Trade. The community of Chatham has been very concerned about proposals by International Harvester to close or modify one of its truck manufacturing plants. Does the minister have any information concerning whether the Chatham plant will be affected by this proposal?

Hon. Mr. Walker: Mr. Speaker, actually just minutes ago we received word that there will be a --

lnterjections.

Hon. Mr. Walker: I just happen to have a prepared statement here.

Interjections.

Mr. Speaker: Order.

Hon. Mr. Walker: There will be a major rationalization of the truck plants in the United States to Springfield, Ohio. That, however, will not affect Canada, and the Chatham plant will be maintained in total. I can assure the honourable member that, to the extent the telephone information we have received is correct, the plant will remain at the current levels, presumably: and, indeed, there is a likelihood that a global mandate will be achieved, or at least a North American mandate, as it relates to the products they will be providing from that plant.

Mr. Watson: Does the minister have any information as to whether any global mandate that will be given will increase employment in the Chatham area?

Mr. Walker: I think it would, given the nature of the mandate I understand might be offered.

3 p.m.

Mr. Wrye: Mr. Speaker, given his general feeling there will be some increase in employment, can the minister indicate what discussions he has had with the International Harvester people in the last couple of months since the need to rationalize North American operations became public knowledge? What guarantees has he had from Harvester that, should the announcement made today actually occur, Chatham, which is suffering from high unemployment will, indeed, get a shot in the arm? Is the government prepared to play any role in ensuring Chatham will get higher employment?

Hon. Mr. Walker: Mr. Speaker, we have had discussions. Our people have been in constant contact with the member for Chatham-Kent (Mr. Watson) as well as with Mayor Carter from Chatham and with Mr. Munro, who is the president of International Harvester. At times there has been almost daily contact over the last couple of months. There has been a lot of byplay back and forth. We have no guarantee from them. We are not in a position to demand a guarantee so they obviously have not offered a guarantee.

I think one would have to look at the news that has come out today as welcome news rather than try to cast a pall over the top of it. It seems to me the member should be looking more at the upside of this than the downside. It is important that it has been established that an exemption will be given to the Chatham plant and those vehicles will continue to be produced in that International Harvester plant in Chatham. The member should be looking at that from a positive side rather than continually putting a pall over it.

METROPOLITAN TORONTO POLICE PRACTICES

Mr. Conway: Mr. Speaker, I have a new question to the chief law officer of the crown for Ontario whose primary responsibility is undoubtedly to see to it that justice is done in this province and that it is seen to be done.

On September 7, 1982, the Attorney General said, after consulting his crown law officers -- who presumably included one or both of Messrs. McLeod and Takach -- that having reviewed all these allegations to determine if there could be any substance to any of them, he had come to the conclusion they were totally without substance.

A few short days later, the Attorney General launched an inquiry, embellishing it with a lot of very personal concern about the import of these allegations which hours before, presumably in consultation with McLeod and Takach, he had dismissed with something of a royal flash as being totally without substance. I want the Attorney General to help this House with the specifics that intervened. What was it that came to his attention, and how, in the intervening hours and days, did it make him change his mind rather dramatically'?

Hon. Mr. McMurtry: Mr. Speaker, I am quite happy to answer the same question the same way for the third time. Maybe it will get through to the member this time; maybe it will take 30 times, I do not know.

First of all, I want to make it very clear there was no change of mind at any time. What I said on that occasion, and I will repeat for the third time in this House today, is that as of that date I had been kept informed about this matter. It had been known to us for some time. It was a matter we had expected to become very public, at least by the time Mr. Proverbs went on with his trial. I had been advised by my senior law officers that the investigation which had been going on for some months had not revealed any substance whatsoever -- that there had been no substance established as of that date through the police officers on the tape as far as these allegations were concerned.

There was no suggestion at that time -- and I say so for the third time today -- there was no suggestion by me or anybody in the Ministry of the Attorney General that the investigation had been completed. I do not know how many times I have to tell the member that.

Mr. Conway: Is the Attorney General saying the allegations that so profoundly distressed him post-September 7 and that caused him to initiate the inquiry that he wanted no part of on September 7, were not allegations that either he or his officers had seen prior to the publication of these matters in the Toronto Star? Let me say for the first time, was it not the case --

Mr. Speaker: Order, that is not a question. It is a statement.

Mr. Conway: Then would the Attorney General not agree what really happened and what really changed his mind and the conclusive evidence which intervened was the publication of a raft of headlines in the nation's most-read daily newspaper -- that it was on the basis of that political pressure he changed his mind? Is that what people in this province are supposed to conclude?

Hon. Mr. McMurtry: For the fourth time, I will make it clear that is total nonsense. The member for Renfrew North seems to have the same difficulty a couple of journalists of the Star have had, and that is knowing the difference between a criminal investigation and a public inquiry. The member has used the two terms sort of interchangeably.

There is a difference. A criminal investigation is an investigation. A public inquiry is a public inquiry.

Interjections.

Hon. Mr. McMurtry: Does the member understand that?

Mr. Speaker: Order.

Hon. Mr. McMurtry: What I said and will repeat for the fourth time today, if not the fifth, is that as of that date there is nothing in the internal investigation that warranted a public inquiry. To my knowledge, as of this date there is nothing that has come up through the ongoing investigation that would warrant a royal commission.

As of that date, the investigation was ongoing and it was being reviewed and continued by another police force, I understand because of the enormous public interest in this matter. It was obviously in the interest of the Metro police at that point to have the Ontario Provincial Police involved.

As I said in my letter to the Star the other day -- a couple of weeks ago or whenever it was -- it was quite evident that at some point there would have to be an external review of this investigation because of the serious allegations that had been made by these officers on the tape. I preferred for that to await the disposition of the criminal charge against Mr. Proverbs.

Given the enormous attention that was then concentrated on the matter it seemed -- again I say for the fourth and fifth time -- that it was in the interest of the Metropolitan Toronto Police to have the Ontario Provincial Police take over the investigation. I have had absolutely no change of mind at all. I hope the member would understand that.

Mr. Conway: On a point of privilege: The Attorney General asked me whether I understood that a criminal investigation was a criminal investigation and a public inquiry was a public inquiry. Yes, sir, I do understand.

ABITIBI-PRICE WAGE CUTS

Mr. Wildman: Mr. Speaker, I have a question for the Minister of Labour regarding attempts by Abitibi-Price to pressure its White River mill employees to take wage cuts. I emphasize that I am referring specifically to the mill workers who are members of the Lumber and Sawmill Workers Union and who have a collective agreement in effect until August 31, 1983, not the bush workers whose contract has expired.

Is the minister aware that Abitibi-Price is using the threat of a mill closure to pressure these workers to agree to wage cuts in contravention of its collective agreement? Does he consider that to be in the spirit of the Labour Relations Act?

Hon. Mr. Ramsay: Mr. Speaker, I am aware of the circumstances the member has described. I am not sure that I accept them exactly as he has described. We are looking into the situation at present.

3:10 p.m.

Mr. Wildman: If the minister is aware of it, does he not consider this to be intimidation of the White River workers? Would he agree that what Abitibi-Price is really attempting to do in threatening to shut down this mill, which was built with the taxpayers' money through the Department of Regional Economic Expansion, is to manipulate the workers into appearing to be the reason for the closure of the mill and the shutting down of a whole community? They would make it seem it was because of wage rates and market losses rather than because the mill itself is poorly designed and the company is losing money because of bad design.

Hon. Mr. Ramsay: Mr. Speaker, I am just as concerned as the honourable member is about the future and status of the town of White River, but I am not going to agree to the statements he is making. I would not indicate there has been bad faith until I have had an opportunity to look into it completely.

WINDSOR PACKING

Mr. Wrye: Mr. Speaker, I have another question of the Minister of Labour. Last Friday during question period the Minister of Agriculture and Food (Mr. Timbrell) indicated he would bring to the minister's attention concerns raised over the fact that the 130 employees at Windsor Packing, which closed last week, have been left without their last two weeks of wages and with no vacation pay. Apparently the minister is aware of this.

My questions of the minister are these. Has he now considered the situation? What action is he prepared to take to ensure the workers will receive the proper amounts of money due them to help at least cushion, in some minor way, this latest closure?

While he is on his feet, has the minister been able to make any progress that would indicate that Great Lakes Forgings, which was hit by a strike some four or five months ago, is going to pay the $80,000 in vacation pay that has been properly earned by the workers and that the company has been under ministerial orders since, I believe, April to pay? Could he bring us up to date on those situations?

Hon. Mr. Ramsay: Mr. Speaker, I will try to answer the second part of the question first. I did meet with the solicitor for Great Lakes Forgings, and also a representative of the receiver on Friday past. We had quite a lengthy discussion. We reviewed the various options. We are in a bit of a bind in that we do not want to see the plant close permanently. We want to see the collective bargaining dispute that is going on at the present time resolved. We want to see the plant reopen. We do not want to do anything that would interfere with that.

On the other hand, we have made it very clear to the company we expect the $80,000 to be paid. We went over two or three options. The company is to get back to us within the next day or so about those options. If it is not prepared to meet them, then we have a particular action in mind at that time.

As far as the first part of the question is concerned, yes, we have been aware of the circumstances. Our employment standards branch is conducting a full investigation and, if necessary, I will take the same steps there as I took with Great Lakes Forgings and bring the principals in to discuss the matter.

ORDERS OF THE DAY

INFLATION RESTRAINT ACT (CONTINUED)

Resuming the adjourned debate on the motion for second reading of Bill 179,

An Act respecting the Restraint of Compensation in the Public Sector of Ontario and the Monitoring of Inflationary Conditions in the Economy of the Province.

Mr. Cooke: Mr. Speaker, before I get into the comments I want to make today, I must say there has been a marked change in the member for Chatham-Kent (Mr. Watson) in regard to the interest he is now taking in the problems in Chatham and the unemployment situation. I note that last spring he asked a very serious question of the Premier (Mr. Davis) about the baseball game --

Mr. Speaker: With all respect, this has nothing to do with the bill.

Mr. Cooke: It has to do with industrial development; it has to do with neglect by the Conservative cabinet, and it has to do with neglect by the Conservative government.

Mr. Speaker: I would have to ask the member to refer his remarks to the bill, please.

Mr. Eaton: He is a better member than you are.

Mr. Cooke: We will be watching the member for Chatham-Kent and I think the mayor of Chatham will be as well. I understand --

Mr. Speaker: And now, back to the bill.

Mr. Cooke: -- there will be a serious contest for the nomination meeting in that riding. We had the opportunity last week --

Interjection.

Mr. Cooke: The member is in real trouble in his riding with the chamber of commerce, the labour unions, the farmers. He has a lot of problems.

lnterjections.

Mr. Speaker: Order.

Mr. Cooke: The member for Chatham-Kent has more on the record in the last two days than he has had for the whole of last year.

Mr. Speaker: Order, order. I am willing to listen to you if you are going to restrict your remarks to the content of the bill.

Mr. Cooke: I would like to make some more comments about the unfairness of this bill, if the member for Chatham-Kent will restrain himself.

More and more evidence is coming out --

Interjections.

Mr. Cooke: Curtis Carter is listening, I remind the member for Chatham-Kent.

I would like to make some more comments about the unfairness of this bill. More evidence seems to be coming out every day about what impact this bill will have on the economy of Ontario and on jobs. I note just this morning in the Globe and Mail comments were made by Peter Cook:

"What is more probable is that consumers will be hurt because consumer prices will not come down as fast as people's incomes do. There will be a transfer of income from consumers to corporations, which may or may not be a desirable redistribution at a time when consumer confidence is crucial."

It goes on to say: "If the program is successful and works to bring wages down it will enhance the competitiveness of Canadian exports. Since it will also work to reduce demand in the domestic economy, it means that Canada is now relying more heavily than before on a recovery in exports."

What that is saying is that by restricting wages of hundreds of thousands of employees at both the federal and provincial levels we are neglecting the very important aspect of domestic demand for our own goods. That will result in more unemployment, it will result in higher expenses in the social sector in terms of welfare and unemployment insurance and will do exactly what my leader suggested last week at his press conference: it will result in a higher deficit for this government and will do nothing about the structural problems within the economy.

There was a Canadian Press

article Saturday in my local paper, the Windsor Star, which stated:

"'Restraints programs introduced by the federal and Ontario governments to curb public sector wages and prices probably were politically motivated and will worsen the recession,' a senior economist said Thursday.

"Professor Morley Gunderson and Frank Reid at the University of Toronto Centre for Industrial Relations said in interviews: 'The programs seem to be based on opinion polls rather than statistical evidence or academic support.' Gunderson said he suspects both programs were politically motivated and timed to make them look successful. Whether or not they were needed, it looks good,' he said.

"Reid said: 'If the program succeeded in reducing government deficits, there will be less spending and fewer jobs for the private sector with the result that it is going to worsen the recession. I do not think that a school of thought exists anywhere that public sector controls are the answer.'

"He said the two programs are much less fair than the controls imposed under the Anti-Inflation Board in the mid-1970s because the current programs single out government employees

whereas the anti-inflation controls were universal. There is little evidence to support the widespread belief that public sector wage settlements have been an important factor in recent inflation. His own studies show public sector employees have had only a slight wage advantage over the private sector employees and that exists mainly among lower-paid and female workers."

As I said, the evidence is coming in that this program is unfair. It is politically motivated and will result in more unemployment in this province and in this country. I had a meeting Friday night with a large number of representatives from public service unions in Windsor. I believe the turnout was 50 or 60 of the trade union leadership in that sector. They asked a lot of very serious questions which, quite frankly, I could not answer. They wanted to know what the motivation of this government was in saying even nonmonetary items could not be settled through arbitration.

What logic is there in the fact that this bill completely destroys not only the right to strike, but also access to arbitration in order to settle nonmonetary items?

They cannot understand why the

section on the nine per cent phase-in is so incredibly arbitrary that they cannot make written or oral presentations and the Inflation Restraint Board need not give any written or oral explanation of why it has come to the conclusion and the decision it has. They are angry and feel very much betrayed by this government. The basic feeling all of them have on behalf of their membership is one of alienation and helplessness. They asked me how an individual making $15,000 a year, or how the library assistant in the case I raised last Thursday evening, who is making $16,000 a year, could possibly contribute to inflation.

They wonder how fair it is that gasoline, natural gas, food, Ontario hospital insurance plan premiums, Hydro, all those prices will not be controlled and all increased costs for those agencies can be passed through to the consumer, yet their price of labour, their salaries, their wages are absolutely controlled with no pass-through, no recognition of interest rates and the other increasing costs we all face in today's society.

They asked why the government continues the ad valorem tax on gasoline. Why is it that, on one hand, the government says cost of living allowances are not acceptable -- five per cent is the limit -- but, on the other hand, a cost of living tax which provides that every time the base price goes up the tax goes up, so that there is a built-in inflation factor, is maintained by this government? They ask why the Premier and the Treasurer of Ontario (Mr. F. S. Miller) are so silent on interest rates and why they have not pushed much more aggressively, and used the power they have within this country, to force the federal government to act to lower interest rates.

They feel their jobs are at risk because of the municipal transfer payments. We have received and heard about the threats from the Minister of Municipal Affairs and Housing (Mr. Bennett).

Hon. Mr. Bennett: They are not threats.

Mr. Cooke: No. They are promises that they may get up to five per cent; it is more likely zero per cent. In many cities, especially those like Windsor, Sudbury, Brantford and other cities that have been hard hit by the recession, it will mean layoffs at the municipal level and at the school board level.

There are also implications for property tax increases. On the one hand, their wages are being limited; on the other hand, by lowering the transfer payments so that they do not keep up with the rate of inflation, property taxes are being raised and they cannot pass those costs on through their wage increases.

I noted last week the Minister of Municipal Affairs and Housing said municipalities should cut back on nonessential items, such as recreation. Perhaps that minister over there is living in a dream world. In the city I come from -- and in Chatham and in Brantford and in Sudbury -- the families that are on layoff cannot afford to go away in the summer for a vacation. They do not go down south, as perhaps the minister does, or on a winter vacation. They stay at home and take advantage of the recreation programs that are provided by the municipality.

Yet this minister and this government say those municipal activities perhaps should be cut back, that they are nonessential items. For many thousands of children they are essential items.

Hon. Mr. Bennett: It is a review.

Mr. McClellan: What does that mean?

Hon. Mr. Bennett: That is exactly what it means.

Mr. McClellan: It means a cutback. That is what it has meant for the last eight years.

Mr. Cooke: If the grants are not increased to keep up with inflation it is a cutback. That is exactly what it is.

Perhaps the government would be willing to entertain a suggestion that was made by various union representatives to me on Friday. The big rationale -- it was enunciated again in the Legislature by the Treasurer -- for controlling public sector wages is that they have job security. That is not something I agree they have, because there have been teachers laid off, there have been chest clinics that have closed. There have literally been hundreds of jobs cut out of the public sector. The Ontario health insurance plan office in Windsor is another example. Sales tax offices have closed down. Those people have lost their jobs.

If the government is saying there is job security, perhaps it would be willing to amend this bill in two ways: (1) there should be no provision and no allotment for any contracting out for the elimination of jobs -- no contracting out; and (2) when an individual retires, that job should not be eliminated through attrition but be replaced so the public service stays at the same levels.

I doubt very much whether the government is willing to look at those kinds of alternatives. They talk about job security and then at the same time they eliminate programs, they cut back the colleges and universities and the end result is more layoffs.

I would like to talk about what I think is a positive alternative to this very negative and regressive program. It is a program this party put forward last week and much of it was also part of our pre-budget statement earlier this year. Our alternative puts jobs as the first priority. For the nearly 700,000 people who are unemployed, that is what they want to hear from a government. They want to hear from a government that says, "Jobs are a priority. We value your abilities and your skills. We want to have you contribute to society, not have to resort to unemployment insurance and welfare."

Let us look at housing. A government that was innovative and that cared would look at the needs of middle- and low-income families in this province. They would do what we suggested -- put $150 million into new rental units for middle- and low-income families. That would create 33,000 new taxpayers in this province. It may initially cost $150 million, but by and large those 33,000 people are now living on either social assistance or unemployment insurance. We would turn 33,000 people into taxpayers in this province and we would also create spinoff jobs in the various sectors, such as appliances, furniture and so forth.

About conservation, instead of the ads that talk about "Conserve it, preserve it," let us get serious and get into a major program of conservation. Let us give low-interest loans to people who want to convert to natural gas or for insulation and have energy audits done. Those types of programs could create 20,000 more taxpayers in Ontario.

About public works, we need only look south of the border to see where the neglect of cities has resulted in the need for literally billions of dollars of investment in terms of basic services within municipalities. We cannot allow that type of thing to happen in Ontario. There are cities that very much need to have roads built and sewers improved. We should be talking very seriously about accelerated public works projects in order to create jobs and to fulfil very important needs at the municipal level.

In the longer term we are talking about addressing the structural problems within the economy. We have put forward our Autocan proposal that would use government capital to co-invest with the private sector to modernize our auto parts sector. This would take advantage of the Canadian base that exists now, to build on that Canadian base, to improve competitiveness and to combine that with pressure that should be exerted on the federal government to bring in content legislation. Even under present economic circumstances that would create thousands of jobs in Ontario and would address a very serious structural problem within the economy.

Also in the auto sector, we very much need to get into research and development and that would be one of the very important mandates of Autocan.

In food processing, since the beginning of the 1960s, over 1,300 independent Canadian food processing plants have closed in Ontario. They have been taken over by the large multinationals and now, as I said the other evening, we are a net importer of food in Ontario. We need to get involved through government investment, not through grants and giveaways to such multinationals as Heinz. We need to say to those multinationals that, sure, we need to replace our imports -- for example, tomato paste -- but we are not going to bribe the multinationals to do it.

If they do not want to do it on their own, we will co-invest with the farmers and get into co-ops or we will look at the Canadian suppliers and food processors and co-invest with them. We can replace a lot of our imports through an industrial strategy and planning in that sector.

3:30 p.m.

The biggest deficit throughout the nation exists in machinery. We import literally billions of dollars worth of goods in the machinery sector each year. Through a capital investment program with the private sector, and in some areas on our own, we could create thousands of jobs. We talked extensively about mining and forestry machinery when we were debating the Sudbury situation on Friday. We have incredible deficits in those areas.

The demand exists and the jobs are very much needed in northern Ontario. Instead of setting up committees to study the problem, instead of blaming the federal government and waiting for the federal government to act, why does this government not go it alone if the federal government will not co-invest'?

We have an incredible number of machinery imports in the manufacturing sector as well. For example, even when an automobile plant is built up from the ground, the bricks and mortar represent usually around 20 per cent and the machinery and tooling accounts for about 80 per cent. The vast majority of that machinery is imported and therefore we are exporting thousands of jobs.

Also mentioned on Friday during the Sudbury debate was the serious need to refine our minerals here in Ontario at source, a position we thought was endorsed by the Minister of Natural Resources (Mr. Pope) on Thursday, but he backtracked from that position significantly on Friday.

We must trim a significant amount of government waste. There is waste in this government, for example, in the capital expenditure of Hydro which need not take place if we had a conservation program and if we took advantage of the surplus that already exists in Hydro production. We need not expend that amount of money. We could take that capital investment and use it in the manufacturing sector in Ontario.

We have suggested other areas. For example, this party has gone on record to say we should not be investing in Trillium Exploration Corp., that we should be using that money to invest in Ontario for Ontario jobs.

The advertising budget, while it is a small percentage of the overall provincial budget, is a significant, symbolic expenditure of a government that on the one hand says, "We have to cut back your wages and tear up contracts," but on the other hand says, "We can promote our party through the expenditure of provincial funds." We think 0 per cent of the provincial government's advertising budget, at least, should be cut, for a saving of $20 million.

To fight inflation, we have put forward the proposal that the price of Hydro and of home heating fuel should be frozen for eight months. Public transit fares should be frozen for one year. The ad valorem tax on gasoline should be frozen at its current level, we should freeze the retail price of gasoline at the current level for six months and then allow price increases only as established under the energy accord between the federal government and the western provinces.

In the matter of rents, there are extremely serious problems in terms of passing through increased finance costs. I am sure my colleague the member for Etobicoke (Mr. Philip) will expand on that in his presentation on this piece of legislation. There have to be amendments to the Residential Tenancies Act to protect those tenants from the large increases that range up to 40, 50 and 60 per cent in some areas, because of refinancing, especially here in Toronto.

Food is obviously an essential item, one in which this government does have a role to play. We should not be allowing the middle man, the wholesaler, the food processor, to expand his profits from food. Obviously, there is a need for the farmer to maintain and achieve profit levels, but the middle men are the ones who are profiting right now and we have to make sure those profits and the margins between the price at the farm gate and what is charged to the consumer are closed.

At this time, job protection is very important. Last week I raised the case of Windsor Packing, and my colleague from Windsor-Sandwich (Mr. Wrye) mentioned it again today: a company that could put up a notice on its door at seven o'clock last Thursday morning saying the plant was closed. There was no prior warning to the union, no consultation with the union; the only consultation that occurred was a message that had been given to the union at the beginning of September that it was time to have preliminary contract negotiations. There was absolutely no indication that this plant had any difficulty at all.

There are many other cases. We studied many plants in the plant shutdowns committee, which was then destroyed, discontinued by this government. We have got to look at amendments to the labour acts in this province to provide for mandatory justification; and in order to have mandatory justification for plant closures we have to have longer notice -- at least six months. We also have to look at expanding the severance pay provisions that were introduced by this government a little over a year ago so that we have universal severance pay in Ontario.

This government has a very important role to play when it comes to interest rates. I said last Thursday, and I repeat today, that this government continues to give conflicting messages to the federal government as to what its position is on interest rates. On one day the Premier says they should be lowered; on the next day he says we have to take into consideration the effects on the outflow of capital. He does not support currency controls.

We should be sending from the Ontario Legislature and from this government a very clear message to the Prime Minister that we expect a directive to be given to Gerald Bouey that the interest rates have to be lowered. If this means there have to be controls on the outflow of capital, then it means we have to put controls on. But the damage that is occurring to this economy and to individual people in this province and in our country, caused by the high interest rates, simply cannot be allowed to continue.

In the short run, this government has to put into place interest rate assistance programs for small businessmen, farmers and home owners. It is simply unfair that thousands of people in Ontario have lost their homes and this government just sits back, throws up its hands and says, "It is the federal government's fault." Other provinces have brought in programs: the Social Credit Party, the Conservative Party and my party have all brought in programs; but this government instead decides to play the political game of passing the buck and saying it has no role to play at all.

The issue of banning extra billing was raised in the Legislature today. I do not think there is any more symbolic issue for workers in this province than that of the doctors in this particular wage control legislation. On the one hand, the government gave a $750-million settlement over three years to the doctors just a few months ago, and then they come back here today and say: "We have signed an agreement with the doctors. They are on their own.

They are individual business people, and therefore we cannot touch the so-called contract we signed with them." On the other hand, they suggest to 500,000 employees, 400,000 of whom are unionized, that their contracts can be torn up, that they mean nothing.

Now the Premier has called a meeting with the doctors for tomorrow, at which time he is going to beg them to show some voluntary restraint. He is going to use moral suasion. On the one hand he uses legislation for the ordinary working men and women of this province, and on the other hand, for doctors, the highest income earners in the province, he attempts to use moral suasion. I think that is a very unfair approach, and I think the idea is going to come back to haunt this government.

As we go on in this debate, and when we have committee hearings, the inequities, the unfairness and the arbitrary powers that have been given to the Inflation Restraint Board by this legislation will become increasingly clear to the people of this province. There are other parts of this restraint program that are still to come forward.

They will not be debated in the Legislature, but they will be announced by cabinet: cutbacks in transfers to municipalities, school boards, colleges, universities, hospitals, leaving those already living in a situation of poverty in our province to go into a situation of deeper poverty. These are all part of this government's restraint package, a package that makes no economic sense, but that, in the short run, will make a lot of political sense to the Conservative Party.

3:40 p.m.

The cutbacks to colleges and universities that have occurred over the last decade will continue. They will probably be hastened. The end result will be that, in future years, we will not have adequate numbers of engineers. We are already short. The kinds of skilled people we need in the high technology area will be in further short supply. The evidence is very clear that this government is taking a short-term political approach when we need a long-term economic approach to solve these problems.

We expect this bill will go out to committee after we have had a lengthy debate here in the Ontario Legislature, and that in committee we will have the opportunity to hear from all sectors of the economy: the labour movement and individual people who are being hit hard by this legislation. In the five years I have been a member, there has been no other piece of legislation that I have been more opposed to. I wish we were still in a position in this Legislature to have more influence on this government, but since it has re-achieved its majority, it has become more out of touch and more arrogant than ever. I doubt very much whether there will be any significant changes in this legislation.

I can assure you, Mr. Speaker, that this party and this caucus feel very strongly about the legislation. We will fight it on second reading; we will fight it in committee; we will introduce our amendments, and we will vote against this bill on third reading. There is no amendment I can foresee that could possibly change the position of this party, because the principle of this bill is completely contrary to the basic principle of equity in which we, in the New Democratic Party, believe.

I was going to say I look forward to further debate on this legislation. I do not. I really resent having to be back here to debate such a regressive piece of legislation. I would much prefer to have been back here debating a job creation package.

Mr. Watson: You would prefer to be in Chatham.

Mr. Cooke: No, I have not been to Chatham lately, but I will be there next Sunday at one o'clock at the UAW hall, if the honourable member would like to stop by.

I hope this government will not try to stop the public hearings when the bill is referred out to committee. I hope this government will allow full and complete public hearings. I hope that somehow, through those public hearings and through the individuals who present themselves before the committee, there will be a withdrawal of the legislation, but, to be a little more realistic, knowing the position of this government and the position of the Liberal Party -- or what we should perhaps be calling the Liberal-Conservative coalition -- I hope there will be some changes in this legislation, at least.

Hon. Mr. Bennett: Mr. Speaker, last Thursday, as I indicated to this House, we had the opportunity of meeting with representatives of the Association of Municipalities of Ontario, the overseers of the responsibility from the province to the municipalities. There are some 838 municipal units in this province.

At the time the Premier (Mr. Davis) and I had the opportunity of meeting with them, we reviewed the reasons for the legislation that is at present before the House. We took into account some of the problems that municipalities had been facing over the last number of years. We reviewed with them things relating to the grant formula, arbitration, and the increase in costs to the municipalities as far as licence fees and things of that nature were concerned. At the time I emphasized again that I doubted very much that there would be any substantial increase in the grant payments in actual dollar factor to municipalities in the year 1983.

We went through the situation with the municipalities, and I want to emphasize here today, to put it to rest, the fact that never at any time have I discussed with municipalities that I was going to encourage the Treasurer (Mr. F. S. Miller) of this province or, indeed, the cabinet to increase grant payments to the same extent as inflation was affecting this province or the country.

I said a year ago in speaking to the Association of Municipalities of Ontario that this was not my intention, that I would seek for them what I thought was a reasonable amount of increase in transfer payments in relation to the province's ability to raise revenue; but I assured them, as I assure this House this afternoon, that I was not going to recommend to the Treasurer that we look at an inflationary factor.

I said it clearly and I repeat it: If that is what we are looking for and if that is what municipalities want, the problem, in my opinion, is that we are encouraging inflation instead of trying to defeat it. And I did not see the responsibility as solely with the federal government or solely with the provincial government; it must be a collective effort by all governments if we are to try to bring inflation down to a more realistic level.

Mr. Cooke: Forget the rhetoric. Tell us what effect this will have on inflation.

Hon. Mr. Bennett: I would suggest, Mr. Speaker, just to reply to the interjection for a moment, that if we took the attitude taken by the honourable member -- do nothing and just let it go on -- it will eventually devour us. If the member thinks the way to succeed is to spend his way out of a difficult situation, I can tell him that is not my opinion -- a long way from it. The members over there are the greatest ones in the world to try to tell us all the time how to reduce the cost of running government but increase the expenditures.

Mr. Cooke: Time out, there.

Hon. Mr. Bennett: Time out, yes. I will tell the member: With him around, we have had time out for about two hours and 30 minutes in the last couple of days.

Mr. Speaker, I have met with the municipalities on a number of occasions, and let me assure this House that when we met with the municipalities last week, we reviewed with them some of the areas of responsibility. At the time we met with them we reviewed some of the things they were going to be confronted with. The first one the municipalities raised with us was the problems they have been confronted with in the field of arbitration over the last number of years. And they had some very, very strong views.

They submitted to this government a report from AMO that clearly indicates the way they believe we should be handling arbitration in relation to many of the municipal disputes that have taken place. The ministry, along with the Solicitor General (Mr. G. W. Taylor) and the Minister of Labour (Mr. Ramsay), is reviewing that report now, and we hope to have some responses to the municipalities in relation to that report.

But one of the things they could see as a positive aspect of the legislation we are dealing with at present is the fact that, at least for the period of 12 months, they will have a breathing space to try to review the situation in the place they happen to be in. I want to say clearly to this House that I was delighted with the remarks of the president of AMO, which were clearly very supportive of the legislation.

Mr. Cooke: Who did you talk to? The Tories?

Hon. Mr. Bennett: If the honourable member thinks we were talking to the Tories, he should ask the member for Cornwall (Mr. Samis) whether his mayor happens to be a Tory, because that is not my understanding. Indeed, there were several other mayors and reeves in attendance at the time. Thanks, George, for confirming it. He is not a Tory.

Mr. R. F. Johnston: He is a Liberal. It's the same thing.

Hon. Mr. Bennett: No. I would say he is like a lot of NDPers who run for political office municipally: he is apolitical until he is elected.

Interjections.

Hon. Mr. Bennett: Mr. Speaker, I will not get dragged into the little side discussions they are having.

The Deputy Speaker: Continuing on with the debate.

Mr. Kerrio: We know a good thing when we see it.

Interjections.

3:50 p.m.

The Deputy Speaker: Order. The member for Niagara Falls (Mr. Kerrio), are you next? Are you coming up next?

Hon. Mr. Bennett: Mr. Speaker, I was talking about the compulsory binding arbitration. We are reviewing the report. I do have some sympathy for the municipalities and what they have experienced over the last period of time. They believe they have had little or no control over the wage settlements. I think it has caused the municipalities unbelievable grief. I am not really worried about whether I am talking about Windsor or Chatham or any of the other municipalities in this province. They have all been confronted with basically the same problem. They have not had control over their own negotiating situation.

Mr. Philip: You are their problem.

Hon. Mr. Bennett: The member over there can argue it any way he wants. If I am their problem, at least they speak very highly of their problem. That is the main thing. I can tell him the complimentary remarks I have had. I take some degree of satisfaction and pride in the fact that the municipalities respect the fact that there is a Minister of Municipal Affairs and Housing who tries to assist them, but also tries to put them clearly and distinctly in a very positive position when he gives an answer. He is not like the NDP. He is not going to run around giving two or three different answers. I will give them a very straightforward position, not one in the House and one outside the House.

Mr. Cooke: You do not give us any answers.

Hon. Mr. Bennett: I gave them a straightforward answer. The member is complaining this afternoon because I gave them an answer.

Mr. Cooke: Answer my question: What effect will this have on inflation?

Hon. Mr. Bennett: On August 26, I gave them a very clear, distinct answer. I told them their increase in payments was going to be little or nothing in the 1983 year. They have asked constantly for somebody to give them some advance notice about where they are going as far as transfer payments are concerned for the preparation of their budgets for the following year. Because I gave them that kind of answer, the member says it is a dictatorial position. I do not consider it dictatorial at all. I think it is an informative position. It gives them the opportunity of trying to determine their budgets.

I said to them, "If revenue positions of this province change, then the Treasurer will be in a better position to try to cope with them." Let us not have the situation I see so often, where people go out at the municipal level and make expenditures predicated on what they believe is going to be the transfer payment position. They commit themselves to some long-term debt and then come back to say to us, "But we thought we were going to get XYZ."

I said to AMO: "Here is the clear-cut position we are in at the moment in this province, here are the economic conditions we have, here are the revenue positions we have in this province as enunciated by the Treasurer. Don't go out spending money that I can't assure you you are going to get. Live within your means."

The member asks me why I said that to the municipalities. I said to them very clearly that day and I say again today that they have to review their priorities. That is not my responsibility. Mine is to give them as much advice as possible so that they can be on the right road. I said there are other areas. In my personal opinion, there are some I do not think they can interfere with. Those are the life and safety factors of our community -- the fire and police for two of them; welfare payments for another -- because they are virtually dictated to us, whether we like it or not, as members of the Legislature. They are there.

There are other areas of expenditure that municipalities still have a certain degree of authority to make. That is what they are elected to do.

Mr. Cassidy: Close the swimming pools.

Mr. R. F. Johnston: Close the day care centres.

Hon. Mr. Bennett: Let me say to the members of the third party who are the greatest ones to talk about closing this and closing that, they would have us move into areas and close up everything except their pet projects. I suggest to the member for Ottawa Centre (Mr. Cassidy) that the decisions relating to the competence and capabilities of a municipality will be, I trust, made by the locally elected municipal officials, and not by the bureaucrats.

Mr. R. F. Johnston: You are forcing them into it.

Hon. Mr. Bennett: I am forcing them into nothing, Mr. Speaker. I am suggesting to them this is the number of dollars they have. They should not spend their way into bankruptcy. They should practise the policies that are within the framework and the financial capabilities of their taxpayers.

Mr. Cooke: How do they feel about the Treasurer's sales tax?

Hon. Mr. Bennett: I was coming to that issue, but I will deal with it now. I admit to this House that they did mention to the Premier they felt it was an unfair situation. I do not deny that at times there are certain things imposed upon this government by our federal friends that we have to accept whether we like them or not. There are occasions when, because of legislation or because of the time of budgeting in a province, something is imposed upon a municipality --

Mr. Cassidy: That was not mentioned. You should talk to the guy in front of you.

Hon. Mr. Bennett: I have to say that, overall, the fellow in front of me does an outstanding job.

Mr. Cooke: You do not have to say that. The Treasurer is out of the leadership race.

Hon. Mr. Bennett: The problem with the members opposite is that they think everything is -- it might be fall and the leaves are falling, but it is not money coming off the trees. The member for Ottawa Centre might think it is, but it is not money coming off the trees. The member for Ottawa Centre might think it is, but it is not.

Whether the Treasurer is in or out of the leadership race, let me assure the member he far surpasses anyone who sits on that side of the House. He has brought forward to this province a realistic budget to try to keep us in a positive economic position, not only in the eyes of the financial community of this country, but indeed in world circles. Without it, the cost to this government and to the people of this province would be a great deal higher than it is today.

A great number of words of compliment should go to the Treasurer who had the intestinal fortitude to do some things that may not be popular. He did them because it was in the best interests of 8.5 million people of Ontario, not just the Tory party of Ontario, the Liberal Party or the New Democratic Party, but indeed for all 8.5 million people who are concerned about the long-term position of our province, financially and in so many other ways.

Mr. Cassidy: I bet you enjoyed it. You really do, kicking the unemployed like that.

Hon. Mr. Bennett: I hope the member for Ottawa Centre read the

article on the editorial page last week about him kicking the unemployed where he could do certain things. Did he read that little story in the Ottawa Citizen? I do not read it that often, but I trust he did.

Mr. Kerrio: Tell us about Saskatchewan where they took away the right to strike. What about the people out there?

Hon. Mr. Bennett: During the course of the afternoon when we met with AMO for an hour and a half or two hours they had certain complaints, but overall they saw this particular piece of legislation as being very supportive of their position.

As the members know, they sent the Premier a letter at the time he was in the Maritimes at the first ministers' conference, supporting him in his position that we should bring in a restraint program in the province. Last week, they went through the situation with the Premier and said there were areas where certainly they had some concern, but basically they supported the initiative of this province.

On that AMO executive there is a political philosophy very much right and left of the centre of the government of this province. So it comes from those representing various jurisdictions that may not have the same political decision-making as this party happens to represent in Ontario.

Let me only touch on one or two other items that I think are of importance. Certain municipalities require extra help and I said -- and I trust the member from Windsor will recall that I said it although he conveniently omitted that in his remarks this afternoon -- that at the time of reviewing the transfer payments, the policy that will be enunciated by this party and government will take into account some of these conditions at the time of review of the communities where there is a very excessive unemployment situation prevailing. I indicated Brantford, I talked about Windsor, I mentioned Sudbury and several others.

Over the years, this government has dealt with municipalities in a very fair and honourable way. They have recognized the problems. I did not say we had an answer for all of them but certainly we recognized them and assisted them. They have been treated very fairly in the transfer-payment formula in the past and will continue to be dealt with in that fashion. I trust that their move the other day was to try to assist this province in meeting the challenge that was offered at the time we opened the House a week ago when the Premier said, "I trust that together we can find the means and the will to best achieve economic recovery for Ontario and for Canada."

I say with a great deal of delight that the municipalities have responded in an extremely positive way to assist this province in trying to recover from some of the economic ills that we experience today and not to continue to try to plough us deeper and deeper into a problem.

Mr. Speaker, I am pleased to support the bill that is before the House. I guess the greatest satisfaction is that I find AMO, which represents 838 municipalities in Ontario, is fully in support of the government's position. I look forward to the bill returning us to a stronger position economically, not only for this province but in its makeup for the nation.

Mr. Van Horne: Mr. Speaker, while we have the Minister of Municipal Affairs and Housing (Mr. Bennett) and the Treasurer (Mr. F. S. Miller) present, I am going to take the liberty of digressing for a moment and ask your indulgence -- if I can get their attention.

Are the Treasurer and minister of municipal affairs with me?

Hon. Mr. Bennett: Yes.

Mr. Van Horne: Okay.

In my community, there is one of the biggest, if not the largest, single dollar commitments made between this province and a municipality. I am referring to the relocation of Victoria Hospital to the Westminster Hospital site. If the Minister of Health (Mr. Grossman) were here, he could probably solve the mystery of the dollars.

When we are talking about co-operation from municipalities, I am sure the Minister of Municipal Affairs and Housing will have some understanding of the need in our community for the dollars to start flowing into this project, dollars that I understand have been committed. The question is how much longer must we wait until they can get started on this project.

4 p.m.

The delays that have come about in the past month or two mean that instead of having two winters to work through the construction of this megaproject, they will likely face the prospect of three winters of construction.

I ask the Treasurer and the Minister of Municipal Affairs and Housing whether they can shed any light on this. If they could nudge the Minister of Health in this regard, the municipality -- and the mayor in particular, the gentleman with whom I spoke only 24 hours ago about this -- would be very appreciative because this, in turn, would mean the construction industry would start to move again in our community. We would have a little more to hope for and to work with in the next few years.

Having allowed me that small digression, Mr. Speaker, I will move now into a few words on Bill 179, which our party is supporting,

An Act respecting the Restraint of Compensation in the Public Sector of Ontario and the Monitoring of Inflationary Conditions in the Economy of the Province. That is one of the longest-titled bills that any of us has seen in some time. I only hope its length equates to something positive. We are all desperately hoping that something positive does come out of this piece of legislation, because we are in desperate times.

Some businessmen in my community have suggested to me in the past few weeks that it is time for partisan politics to be put aside. I remind the members on the far left of this chamber of that need, and not the members opposite, because they are obviously very much aware of the need for partisanship to be put aside. This is the equation used by many of the people I know back home: "It's wartime, folks, and we'll only win if we can pull together."

We support the bill with the hope the war will be won. We are supporting it too with considerable pride, because members will recall that during the earlier part of the summer it was our leader who took the initiative in suggesting full wage and price controls in the province and, he hoped, in the Dominion of Canada.

We are proud of the leadership shown by the member for London Centre (Mr. Peterson), our new leader. As members know through his words and through the words of other people in the party, we support Bill 179. But at the same time we must point out that this bill is not the complete solution to the problems we are facing in this province and in this country.

One or two of the people in the fourth estate have referred to this as a five per cent solution to a 100 per cent problem. I would be more kind. I would submit that if we all worked together on this five per cent solution, it could turn into something closer to 100 per cent.

Each member of this assembly could give examples from his or her own riding as to the effects of inflation, unemployment and other factors that have almost brought us to our knees, economically speaking.

In London, the city of which I am proud to be part and which I represent in London North riding, we have had problems not unlike those faced by other communities.

The General Motors diesel division has a large plant in the northeast corner of our city. It happens to be in my riding. It has suffered the knocks and blows of the economics of 1980, 1981 and 1982. The Ford plant at Talbotville, just a few miles to the south of my community, has many of its workers living in the riding of London North. It too has been affected by prolonged layoffs and cutbacks.

I could name any number of smaller businesses in our community, but I will use only one name, that of Postian's Ltd., a rug business more than half a century old. It was a very successful family business that was brought to its knees by the economy we know in 1982. It had to close its doors a few weeks ago.

I could go on and on with these stories of heartache. I have brought along my telephone-call file. Every member has one of them. The call slips for today, picked up over the weekend from the answering service, are 18 in number. Of the 18 calls, 12 relate to being laid off or to some problem the person is having surviving in today's economy.

I could go on and on. The University of Western Ontario, also in my community, is my Alma Mater and a post-secondary institution that is renowned in our Dominion. We also have one of the finest community colleges, Fanshawe College, in the riding of London North. Both these institutions have many hundreds of students this fall who are there without the money needed to get them through the year. Summer jobs and part-time jobs are drying up. The students in turn are suffering, hoping somehow or other to survive the winter.

The universities, the colleges and the various boards and commissions within our community are all trying desperately to survive the exercise of economics in 1982 by holding the line or by cutting back wherever they can. We have to ask ourselves, "Is this enough?"

Of course, we know there are only certain portions or elements within the community over which we as a Legislature have direct control. We have to hope that what we are doing will rein in that sector of the community to help slow down the inflation process and put some stability back in our economic life, that the ripple effect will spread into the private sector and that we will see restraint shown there as well. A number of companies in the private sector have already said they are holding the line on expenditures and they will not have their usual percentage increase, whatever it is, this year. It is to be hoped that there will be a spinoff.

Aside from the interest we have in our own communities, we in the opposition have various assignments to reflect the job we have in opposition. I am referring now to the role of critic. In my area of criticism, Northern Affairs, it is most appropriate that I direct a considerable number of my comments to the concerns we have about restraint and about the economy as it affects our various areas of criticism. I will be addressing a substantial number of comments to this theme as it relates to Northern Affairs.

It is interesting to note that no matter what happens in Ontario, be it good or bad, it is always reflected with a slight increase in the northern part of our province. If we have an unemployment rate of 10 per cent here in southern Ontario, for example, one will likely find a rate of 12 per cent or more in the north.

The unemployment statistics are devastating when one looks at a community such as Sudbury, which at present has 26.9 per cent unemployed. We were given these numbers only a few days ago by Statistics Canada; so I hope their accuracy is as good as it can be.

In Thunder Bay, again quoting Statscan figures, unemployment is 10.1 per cent. In northeastern Ontario generally, it is 18.9 per cent; that compares with Ontario, which in total has an unemployment rate of 10.1 per cent.

Things are desperately tough in northern Ontario. As I pointed out in the emergency debate on Friday, restraint has become a way of life in northern Ontario, not only for those working in the public sector but also for many people working in the private sector.

4:10 p.m.

We have to take a look at the differing costs of surviving in northern Ontario and ask whether restraint is as fairly applied in the north as it might be in the south. The increase in food prices in southern Ontario during August, for example, was 7.3 per cent; in the north it was closer to nine per cent.

You do not have to spend too many days up in the north buying such luxuries as fresh fruit, for example, to realize you will pay 50 cents or $1 or whatever more, depending on the size of the bag of apples you buy. You pay more in Sudbury, more in Sault Ste. Marie and more in Wawa than you spend here in Toronto or in Hamilton or in London. They have that additional factor to contend with. They also have the severity of climate to contend with; their fuel bills are considerably higher because of the longer and colder winters.

One has to ask about the fairness of restraint across the board. In talking with the people I know in the north -- I certainly made a point of contacting as many as I could after this bill was introduced to get their reaction, and I attempted to get as much reaction as I could from the northern media -- the general consensus was: "We are as much Ontario as any other place. We want restraint if it is going to help." So there is a spirit of co-operation, even though economically they suffer more than we do in the southern part of the province.

I mentioned in general terms the effect of the economy on the employment situation, using very general numbers for Sudbury, as an example, with more than 26 per cent unemployed. I must point out as an aside that although these are Statistics Canada numbers, the percentages are probably higher. As the Treasurer knows, not everything is recorded officially in a government office. Many people who do not take the time to register would not show in this percentage; therefore, the actual percentage unemployed would be considerably higher than is officially recorded.

I wish the Minister of Northern Affairs (Mr. Bernier) were here, because he should be made aware of the concern we all feel about the specifics I am going to refer to.

In the mining industry, a 13-week layoff of Falconbridge's entire staff of 4,000 was announced recently. That will last until the end of September. Inco announced about a week ago that its layoff situation will continue into 1983. There are indefinite layoffs of 2,100 at Algoma Steel in Sault Ste. Marie. It is interesting to note that 750 employees at its tube mill were given layoff notices that lasted through the month of August.

Sherman Mine in Temagami and the Adams Mine in Kirkland Lake are other examples of very high layoff areas. At the Umex mine at Pickle Lake, 210 people lost their jobs. Eighty people were laid off at Dickenson Mines at Red Lake. And so it spins through the north of our province from mining community to mining community.

When one sees this -- and this is why I had hoped the Minister of Northern Affairs would be here -- one has to ask whether the devastating effect of layoffs in single-industry communities has been properly addressed by this government. Although we say, "Yes, it is great that you bring in Bill 179; it's great that you talk about restraint," we have to ask in the next breath: "But where is the total package for the economy of this province? Where is the total package that is going to put us back on our feet in every possible way?"

We can consider the forest industry for a moment. The layoffs in the forest industry are just as bad as they are in the mining industry. Layoff announcements change so quickly that keeping an accurate count of the layoffs at any one time is almost impossible.

The effect of this on people can be found if one takes a look at population figures in the north. Northern Ontario's population in the year 1981 stood at 819,576, an increase of only 2,435, or 0.3 per cent, since the last census in 1976. This is the smallest five-year increase in population for northern Ontario since the end of the Second World War. Over that same period of time, Ontario's total population increased by 4.4 per cent.

Northern Ontario's total population has remained fairly stable since 1971, when it was 806,719. This means that northern Ontario has not kept pace with natural increase and that nearly as many people have left northern Ontario in the past 10 years as has been the natural increase in the past 10 years.

Why is this? People have been forced to leave the north mainly because there are not enough job opportunities. Again we have to ask: In all the studies that have been done on the singleindustry communities, in all that has been studied on the environment and other factors in the north, where is the answer? Where is the total package'? Where is the leadership we need to keep this province of ours stable?

I have indicated time and again, as have my predecessor as critic of the Ministry of Northern Affairs, the member for Rainy River (Mr. T. P. Reid), and my leader -- who not only speaks of support for the north but also shows his determination to help the north and his desire to speak out on its behalf by actually being there and by working with them -- that northern Ontario has been treated as a colony of the south and that this colonial status has been reinforced in such areas as transportation costs. Northern economic development has been impeded by the predominantly north-south pattern of the transportation system.

According to an analysis by the Ontario Economic Council, shipping rates are significantly lower for goods outbound from the region than for shipments originating in other parts of Canada and destined for northern Ontario. The council concludes that the high level of rates on inbound movements is detrimental to the region's ability to diversify from its existing narrow export base, because many essential components of this secondary manufacturing process must be shipped over considerable distances.

It is interesting to note that the only concession, and it is a very minor concession, that has been made in this regard was found this summer when, after talking about this experiment for about three or four months, Canadian Pacific, Canadian National and the Ontario Northland Railway are going to reduce freight rates drastically for most types of northward-bound boxcar freight. The reduced rates will apply to certain limited commodities and are part of a short-term market test to see what sort of business reduced rates will generate.

4:20 p.m.

That is the only concession that has been given in the past two decades for transportation costs for northern Ontario, and it is a very small concession to a very major problem. Only a handful of selected commodities are going to realize the benefit of this lower rate. I wonder what it is going to take to prove the need the north has.

Dealing with another topic of concern, Ontario law says that all metals mined in the province must be refined completely in Canada, yet the Conservative government has passed hundreds of exemptions. It has passed more than 65 in the past half dozen years alone, allowing millions of pounds of semi-precious metals out of the country and providing processing jobs elsewhere. This law is for all purposes almost nonexistent.

Of the metallic minerals mined in Ontario, about 30 per cent of the zinc, 33 per cent of the nickel, 100 per cent of the platinum group metals, 38 per cent of the lead, 17 per cent of the iron ore, 11 per cent of the cadmium, 10 per cent of the copper and 55 per cent of the cobalt are processed outside Canada.

Another problem we had hoped this government might address somewhere along the way so we would see an economic upswing or a return to stability in the north is the lack of an adequate supply of replacement parts in the mining industry. Most mining equipment parts are made outside Canada, although they could easily be manufactured in Canada and specifically in northern Ontario.

In 1980, Canada's trade deficit in drilling and mining machinery was approximately $1.5 billion, a fivefold increase since 1970. Ontario's 1979 deficit was $250 million. The Treasurer himself, I think, agreed that if these imports were replaced from domestic sources, approximately 3,500 jobs could be created.

Mr. Kerrio: You'd think we had just started mining in northern Ontario.

Mr. Van Horne: Indeed, just to reopen them.

Mr. Kerrio: That's a shame.

Mr. Van Horne: We have a concern, not on this bill itself in so many words and what it is intended to do, but about the total package of restraint and economy building which we hope will see this province of ours get back on its feet. If it does, we all know Canada will get back on its feet, because in this province we have been blessed with practically every resource known to mankind and we have every opportunity to develop those resources and take the leadership role in this great Dominion of ours.

But we do have these problems we perceive in the overall government program. The government's record in recent decades is one we are not very proud of. The truth of the matter is that we do not feel our government has ever made an honest attempt to make northern Ontario more than just a provider of resources. Northerners are still hewers of wood and carriers of water.

The Ministry of Northern Affairs has not done anything to change the situation, certainly not in the five- or six-year history of this ministry. We still have the same problems now that were there five years ago and, if anything, rather than seeing the problems change in an improved way, they have become worse.

The government has failed to implement any plan that would lead to the diversification of the economy of the north. We still have one-industry towns up north, although there are fewer of them every day, based solely on the extraction of forest or mineral products or based on tourism. There has not been any addition to the economic base of these communities to ensure future stability. Severe difficulties have been experienced by one-industry towns that have lost their major source of employment, and I have already mentioned the names of many of these.

It was most interesting to read a press report in the last few months in which the Minister of Northern Affairs (Mr. Bernier) had called for a joint study group to look into the special problems of communities dependent on the mining industry for their economic health. What makes the report of this announcement particularly interesting is that the government established a cabinet committee on mining communities in 1977 to look at the very same problem. This committee was quietly shelved in 1980 without arriving at any conclusion or a solution.

Mr. Cassidy: That's what the member for Port Arthur (Mr. Foulds) said on Friday. Glad you're catching up.

Mr. Van Horne: I am going to respond. I do not like to respond to interjections, because I do not think it is very productive, but I think the member for Ottawa Centre (Mr. Cassidy) might recall that I too was here on Friday until one o'clock and spoke in that emergency debate. On more than one occasion I have made somewhat the same observations as the member for Port Arthur; so I do not know that I need reminding, and I will just leave it at that.

I would add, going back to this thought, that an in-house interministerial committee on single- resource industry communities was established towards the end