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December 11, 1991

35th Parliament, 1st Session

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Hansard Transcripts

vol. A

Hansard Transcripts

vol. B

The House met at 1330.

Prayers.

MEMBERS' STATEMENTS

MINISTER'S COMMENTS

Mr Miclash: Over the course of the past two days, the Minister of Northern Development and Mines has told this House that she fabricated allegations about a doctor in northern Ontario during a conversation, that she has apologized to those individuals involved and that she has done everything possible to correct this incident.

This minister has not apologized to the people of northern Ontario who placed their trust in her to secure for them the best possible health care. Some two years ago, the minister toured the north hearing health care concerns. On February 8, 1989, she stated in this House, "By far the most common problem was that of attracting and retaining specialists in northern Ontario."

As long as the minister remains as the Minister of Northern Development, her presence will simply compound this problem. The minister has not apologized to northern residents for jeopardizing one of the most key components of a reputable health care system for the north, that being the attraction of doctors and specialists.

I will tell members why she has not apologized. It is because the minister does not understand the gravity of the incident. It is not solely about seeing private files or slandering an individual. It goes beyond understanding the difference between a mistake and a deliberate falsehood. It is about betraying the trust of people. The minister has betrayed the trust of people who believed she would be responsible enough to act in their best interests. As a minister of the crown, she has displayed a total lack of judgement. As a result, she has lost her credibility and her dignity.

Before the minister loses her integrity, she should please show that she understands her responsibilities and resign.

LABOUR LEGISLATION

Mr Cousens: The government is not listening to the concerned businesses of Ontario. The proposed Labour Relations Amendment Act will be the final straw to force business out of this province. Already there is a loss of over 160,000 jobs in this province.

Small business is the backbone of this province and business people are saying that conditions are not conducive to staying in Ontario. This level of frustration is highest here in the greater Toronto area. Walter Ho, president of the Scarborough Chinese business association, is quite explicit in conveying his feeling that prevailing economic conditions and the proposed labour legislation will deter business investment from Hong Kong. More and more Chinese businesses are looking elsewhere to invest.

Markham businesses are fed up. The labour legislation is yet another worry. This worry is distracting business from planning for the future, thereby doing a disservice to its workers and the economy.

Yesterday's bad news from Pink Floyd Laughren should indicate to the government that business is ready to leave Ontario and that the workers of this province will be the first to suffer. There are no initiatives for business in this province from this government; there are only disincentives. This government is not doing its job. We just have to get rid of it or get it to understand that business needs leadership and not the corruption this government is good at.

STUDENT FORUM

Mr Fletcher: Our Lady of Lourdes High School in Guelph recently held a students' forum on national unity for 80 delegates from Prince Edward Island, Manitoba, Quebec and Kahnawake Mohawk Nation. This was the third forum organized by the senior students of Joe Tersigni's class in Canadian History in North America.

An

article in the November edition of Canadian Living magazine describes how the students, in caucus meetings and open sessions, tackled issues such as the Oka crisis, Quebec's "distinct society" clause, western separatism and aboriginal self-government. Keynote speakers were Robert Catherwood, senior editor for the Financial Post; Chief Davis Rice, Mohawk Nation Quebec, and Keith Spicer, the former chair of the Citizens' Forum on Canada's Future.

After three days of sometimes heated debate, the students passed three resolutions: first, that Quebec be granted distinct society status in the Constitution; second, that we recognize the aboriginal right to self-government and, finally, that the Prime Minister call an immediate first ministers' conference which includes aboriginal delegates to solve our constitutional crisis.

The students sent their resolutions by telegram to Prime Minister Brian Mulroney.

Mr Tersigni is already planning his third forum, called Canada Round Forum '92. On October 2 of next year, five delegates from each province, five Innu and first nation delegates will gather in Guelph.

I say to my colleagues of all parties that if Joe Tersigni's students can work together to resolve key controversial issues, surely we can do it for the people of this province and surely our federal representatives can do it for the nation.

ONTARIO ECONOMY

Mr Phillips: It is increasingly clear that the New Democratic Party government is creating a bleak future for the people of Ontario.

In the first year of this government, it developed a four-year fiscal plan that is devastating the fiscal stability of this province. It has managed to put in place a plan that will mean, without question, massive new taxes, huge deficits and a doubling of the debt. In fact, at the end of the regime of this government every working person in this province will personally owe $16,000 worth of debt.

In spite of the fact that the economy in 1991 actually performed better than the Treasury people predicted, it has created a massive fiscal problem in 1991. Now we are beginning to see the impact of its economic plans. Daily we see bankruptcies, plant closures and growing despair among the unemployed.

As we look at the economic renewal plans of the government, they are at least six months away, and each of the aspects of its economic renewal plan is, in our judgement, questionable. The Labour Relations Act changes will create turmoil. The Ontario Training and Adjustment Board, which is fundamentally a sound conceptual idea, will be managed by the unions. In our opinion, the union venture capital plan will not work.

The 500,000 people who are unemployed in this province are looking for action from this government. We need action now, not six months from now, and not action that will not work.

AGRICULTURAL LAND

Mr Turnbull: The commission on planning and development reform in Ontario, headed by John Sewell, sets out a number of conditions which would have to be met before good farm land can be developed, including preparing a 20-year plan that must show there is no good, practical alternative.

In May 1991 the ministry announced its plan to construct an eight- to 10-lane highway through the heart of the town of Newcastle. This southern route will destroy thousands of acres of prime farm land, while the alternative northern route would cut fewer farms in half and destroy less agriculturally developed and agriculturally suitable land. A videotape has been sent to the Ministry of Transportation proving this point.

Contrary to a report from the Ontario Ministry of Transportation consultants, the town council of Newcastle has not endorsed the government's proposed route. It has instead scheduled a public meeting on Monday, January 27, for consultation with the public on this very important issue.

I call on the Ministry of Transportation to respect the opinion of the people of Newcastle on the location of this highway through their community and to honour the government's commitment to save valuable farm land.

WORLD ICE FISHING CHAMPIONSHIP

Mr O'Connor: As we approach this winter season, residents in my constituency are preparing for the winter sport of ice fishing. This sport has been gaining in popularity and this winter is going to have a greater impact economically than in previous years. Members may ask me why. I will tell them.

This year the World Ice Fishing Championship, which has never been held outside Europe, is being hosted in my riding by the town of Georgina. This international event is going to have five teams from more than 30 countries competing on the ice of Lake Simcoe, from Jackson's Point all the way around to Beaverton.

This year, for the first time, the derby will focus on a catch-and-release policy. Competitors will be allowed to keep a trophy-weight fish but are very responsible in making sure that any damaged fish are kept as well. They are going to use this policy to demonstrate an action of conservation of the fish stocks in Lake Simcoe.

The World Ice Fishing Championship, which takes place from February 5 to 11, will wind up on February 10 with the closing ceremonies at De La Salle Park in Jackson's Point. The dinner festivities will take place at The Briars. February 11 is going to be a day left free for the residents to show off their community and for the competitors to visit and tour around their host country. I invite all members of this House to take an opportunity to come up to that event.

MINISTER OF NORTHERN DEVELOPMENT

Mr Brown: I rise on behalf of the people of the north. The people of the north struggle every day. The jobs they once took for granted are disappearing. Unemployment, welfare rolls and deterioration of the health care system are the issues northerners are thinking about and worrying about.

The Minister of Northern Development has a responsibility to northerners. The Minister of Northern Development is the north's voice at the cabinet table. The Minister of Northern Development must be a strong advocate for northern jobs, northern health care and a myriad of other northern issues.

We cannot afford to have a Minister of Northern Development who pits one northerner against another northerner. We cannot afford to have a Minister of Northern Development who writes the district welfare board to have an NDP alternate provincial representative appointed. We cannot have a Minister of Northern Development who interferes with the College of Physicians and Surgeons of Ontario. We cannot have a minister who slanders northern physicians. We cannot have a Minister of Northern Development who clearly believes the end justifies the means.

The north more than ever needs a strong voice, an uncompromised voice, a voice that carries the weight of a northern consensus. The north deserves better.

POST-SECONDARY EDUCATION

Mrs Cunningham: In his 1990 throne speech, the Premier said, "To face the challenges of the 1990s effectively, we must become a learning society, where education and training are seen as fundamental to individual growth, where investment in people is understood to be as important as investment in capital or in research and development."

After waiting a month with absolutely no reply from the Premier's office, the council of board chairs of Ontario universities was told it will not be granted a meeting with him. The council of chairs asked for the urgent meeting in late October, following a $13-million clawback of promised funds to colleges and universities. They were part of the universities' base at that time. The board chairs wished to discuss the urgent need to establish a multi-year plan, which is something we have been urging the Minister of Colleges and Universities to provide for months now.

The students of this province ask whether post-secondary education is truly a priority with the Premier's government, as promised during and before the election campaign. If it is, we urge the Premier to keep the promise of his open-door policy and invite the board chairs to meet with him as quickly as possible.

TASHI RABGEY

Mr Drainville: I want to thank the members of this House who have sent notes of support, as my father has been very sick recently. I appreciate the kind words that have been expressed in this House.

I would like to bring a young woman to the attention of the House. Her name is Tashi Rabgey. She is from Lindsay, Ontario. Her parents are there. They were Tibetan refugees who came to Canada and found a home in Canada. She has just been named a Rhodes scholar. I believe it is very fitting to raise this issue here because we are always looking in Ontario for those people who seem to exemplify excellence. Indeed, in her studies at the University of Toronto she has shown such leadership and excellence in her studies that she has been awarded this Rhodes scholarship. She will be going to Oxford and will be studying international relations there.

I want to say how proud I am to have a member of my constituency given such an honour as a Rhodes scholarship. It is my hope, and I believe the hope of every member in this House, that Tashi will go forward to Oxford, distinguish herself there, come back again to Canada and give the leadership we always need in this country so that we might build a bigger and better future for the people of this province.

Mr Malkowski: Mr Speaker, I rise today on a point of privilege in response to the statement made by the member for Mississauga South on cochlear implants last Monday with respect to the W5 interview. My views on cochlear implants have clearly remained on the editing floor. I do not oppose government funding on cochlear implant research or development, nor do I --

The Speaker: Order. To the honourable member for York East, I realize this is a point of considerable interest to himself, but it is indeed not a point of privilege. I thank him for attempting to bring it to my attention.

VISITORS

The Speaker: Before proceeding with our routine proceedings, I invite all members of the House to welcome this afternoon, seated in the Speaker's gallery, Ms Joan Sawicki, Speaker-designate of the Legislative Assembly of British Columbia, joined by Mr George MacMinn, the deputy clerk. Welcome to Ontario.

ORAL QUESTIONS

MINISTER'S COMMENTS

Mrs Caplan: I have a question today for the Minister of Health. Very serious allegations have been raised. I would like to ask the minister if she could help us explain what appears to be at least a contradiction. According to a Toronto Star article, Dr Robert MacMillan, whom I know well and whom I respect, has said, and I quote, "Someone had broken their oath of allegiance." Could the Minister of Health please say if she knows whom Dr MacMillan was referring to?

Hon Ms Lankin: I am sorry. I would appreciate it if the member could send over a copy of the

article so I could actually see that

article and the statement. It may help me and I might be able to answer the question, but based on what the member has said I am unable to answer that question.

Mrs Caplan: As I said, these are extremely serious allegations. The minister now has a copy of the news

article I am referring to. It is the second paragraph, "I almost fell off my seat when I learned that someone had broken their oath of allegiance," and further in the article, and this is a direct quote, "Someone has made someone outside the ministry aware of the document." Would the Minister of Health be aware of what document Dr MacMillan is referring to that was released to someone outside the ministry, and could she identify who that person was?

Hon Ms Lankin: Last evening I became aware as a result of a phone call from a member of the press gallery to my office and to other individuals in the ministry. The detailed level of knowledge behind the questions that were asked gave me serious cause for concern that within the last couple of days confidential information may well have been revealed to individuals outside the ministry.

I do not fault the individual reporter or the media. They are following up on information they were provided with. But the level of detail of questioning, referring to an internal OHIP document, gave me cause for concern. I can assure the member that at this point in time I am not aware of how that information was revealed, but I think it is so serious a concern that I have instructed my deputy minister to write -- this has taken place -- to the freedom of information commissioner and request that an investigation be carried out with respect to that.

Mrs Caplan: In this House on December 9 the minister was very clear in her response when she said that she was satisfied no confidential information had been given to the Minister of Northern Development. Is she prepared to say that today, in light of the information that very clearly information was given to the Minister of Northern Development or her staff? If the Minister of Health was aware of that, then she seriously deceived and misled this House.

Hon Ms Lankin: Based on the review of all the facts I had available to me when I made the statement, I was very confident information had not been shared with any MPP or with the Minister of Northern Development and Mines. Last night the information I became aware of was specifically with respect to information one member of the press gallery has. In response to that, I believe a leak of confidential information has taken place.

I have followed up on that. I have held meetings with all the people involved. To the best of my review of it at this point in time, I am still of the opinion that this information was not shared with the Minister of Northern Development and Mines or any other MPP. It appears to me at this point that it has been shared with a member of the media.

However, it seems to me that it is such an important issue of a potential breach of confidential information under my ministry, for which I have responsibility, that I have directed the deputy minister to ask the freedom of information commissioner to conduct an investigation. I think that is appropriate and I will certainly share the results of that with all members of this House.

Mrs Sullivan: My question is to the Minister of Northern Development. Yesterday outside the House the minister, in response to questions from the media, said: "No one gave me anything. No one showed me anything. No one told me to say anything. I did not see anything."

The minister is aware, however, of a story that was heard over CBC North this morning where another Sudbury doctor described a recent meeting with the minister and another physician, and at that meeting the minister told those doctors that she was totally familiar with their files. We understand that today Dr Robert MacMillan is saying, "I almost fell off my seat when I learned that someone had broken their oath of allegiance." What information did the minister have in that meeting and how did she use that information in that meeting?

Hon Miss Martel: I am pleased to respond to the question. I have a copy of what was said by Dr Hollingsworth this morning. He said, "She told me she had seen my file when I met with her." We met in this House two weeks ago. At that point in time we discussed two things, the very serious situation with respect to doctors and retention of doctors in Sudbury, which I am very concerned with, and second, the underserviced-area program, in which Dr Hollingsworth is a participant.

The file that I have seen with respect to both him and Dr Kosar is the file I have in my hand, which is public information with respect to all the doctors in the province who are involved in the underserviced-area program. If I might, Mr Speaker, I would like to table this with both yourself and the two members.

Mrs Caplan: We can't believe a word she says; one lie after another.

Interjections.

Hon Mr Cooke: On a point of order, Mr Speaker: The member for Oriole can say whatever she wants to say, but she cannot continue to call a member of the House a liar. That is what she just said. She said "one lie after another." She must withdraw that comment.

The Speaker: The Speaker is at a disadvantage in that he did not hear the comment.

Interjections.

The Speaker: Order. If indeed the member did make an accusation of another member of the House, it would be appropriate to withdraw that. The Speaker did not hear what was said and under those circumstances a request is always made of the member involved, if in fact the member did say what was alleged, to withdraw the remark. We do not accept allegations of lying across the floor of the House. Could the minister succinctly complete her response.

Hon Miss Martel: The importance of the information that was relayed to the doctor was that in fact he is part and parcel of the program and therefore exempt from the threshold. He had a concern about this because he had said very clearly on another occasion in Sudbury that he felt he was going to be affected and that he would have to leave the community. I assured him that the information that was contained here made it very clear that he was on the program and that he was exempt from the threshold. By the time he was off the program, which would be in June 1992, we surely would have resolved the situation in Sudbury long before then.

Mrs Sullivan: I would like the minister to confirm or deny that in the conversation with those two physicians she also discussed the situation of other physicians from Sudbury, including one physician whom she also discussed at a meeting three days later on December 5, and that she discussed with those doctors that physician's billing practices and medical practice and indicated her concerns to them, naming him by name, and that she also discussed with those doctors other physicians in the Sudbury area who she indicated she knew were over the billing cap.

Hon Miss Martel: When I became aware of the situation in Sudbury, I asked the Ministry of Health for two things: information with respect to the underserviced area program, which is public, and second, numbers with respect to the physicians or specialists who were going to be exempt, who were going to have a problem with the threshold in northern Ontario --

Mrs Caplan: A briefing of what was going on. They gave you confidential information and you broke your oath of allegiance.

Hon Mr Cooke: Mr Speaker, you have to have heard what the member just said. The member cannot accuse a minister of the crown of breaking her oath of allegiance. She cannot say that. She said it as a statement of fact. She must withdraw.

Interjections.

The Speaker: I confess that at the moment the alleged remark was to have been made I was concentrating completely on the reply by the minister, which is my responsibility to do. I would advise all members of the House to please, especially during a very difficult situation, try to use temperate language so that we can deal with the issue in a very common, reasoned way. Intemperate language does not assist this process at all.

Would the minister complete her response.

Hon Miss Martel: I asked the Ministry of Health for two things. Number one was information with respect to the underserviced area program, because I knew that those who were on the program would not have a problem with the threshold. I also asked the ministry if it could provide me with public information with respect to how many people may be affected by the threshold, because it was my concern that there would be a very large number in Sudbury or in northeastern Ontario, and that would leave me in a very difficult position as Minister of Northern Development.

The ministry supplied me with numbers, which were also very public, which were also given to the doctors, which said three things: There are 35 people who could be affected by the threshold; 17 of those are in Sudbury, and 13 of those 17 are specialists and four are GPs. So I knew those numbers and I very clearly gave those numbers to the doctors. That is public information.

Also, I should point out to the member that there have been doctors who have been dealing directly with me because they would like me to help their case. They have told me clearly they are over the cap, and it is those particular physicians I have been working with, in conjunction with the Ministry of Health, to try to resolve the situation.

Mrs Sullivan: The minister clearly did not understand the point of the question.

The point of the question was whether she would deny that indeed she discussed with two physicians the position and her own concerns and passed on information, which was the same information she passed on in a so-called private conversation in a public scenario, about a third physician to two physicians who met with her on the Monday previous, and that this information was indeed confidential information, subject to all of the regulations and privacy requirements relating to the Ministry of Health, protection of privacy of physicians' practices, and that this information was disclosed at that time to those two physicians.

Hon Miss Martel: Again, I have never had access to any confidential information with respect to billing or OHIP on any physician or any specialist in Sudbury or anywhere else. I have never seen that information. I have never been given it verbally over the phone. I have never reviewed any confidential information.

The discussion that took place between Dr Hollingsworth and another doctor and me was with respect to the serious situation in Sudbury, some of the doctors who were affected, those doctors I had met with two days before in Sudbury in order to find a resolution to their problem and, second and most important, the underserviced area program, which showed clearly that one of the doctors I was having the conversation with and several others were on the underserviced area program, were therefore not subject to the threshold and in fact were not in any danger of leaving the community. That was the kind of conversation we had.

Mr Harris: To the Minister of Northern Development, I would like to quote Dr Hollingsworth from a transcript of CBC This Morning: "I didn't realize that the politicians were entitled to have our files, but Miss Martel did have my file. She told me she'd seen my file when I met with her." He goes on: "I'm saying she told me she'd seen my file. She knew when I entered the underserviced area program. She knew statistics about me that, I must say, I didn't know myself."

This conversation took place in the east lobby, I believe, with Dr Kosar present as well as Dr Hollingsworth. The minister is saying she has not seen Dr Hollingsworth's file. Dr Hollingsworth is saying she told him she did see his file. Is Dr Hollingsworth lying? Is Dr Hollingsworth's understanding of this conversation incorrect, or did in fact the minister see information on Dr Hollingsworth that, in hindsight, she now realizes she ought not to have seen?

Hon Miss Martel: The information I saw on Dr Hollingsworth is contained in this document, which is a public document. It was released to the Sudbury and District Medical Society and to the meeting that took place in Sudbury last week. It was also public information, which is why I got it from the Ministry of Health in the first place, so that I could determine, as the local member, which specialists or which physicians were on the program and therefore were not subject to the threshold and would not be in any danger of leaving the community.

Dr Hollingsworth and I talked about two things. We talked about the very serious situation in Sudbury, which I agreed was a serious situation, and I told him very clearly I was working towards finding a resolution. Second, we talked about the underserviced area program, because very clearly he was our participant in it. He did not realize that under the terms of the agreement he may in fact not have a problem. He is on the program until June. He is not in any conflict or danger right now of having to leave the community.

Those are the discussions we had. The information I had access to and had seen was this file which I have sent to the members today.

Mr Harris: The information in this file has supposedly no identifying information of whether anybody is threatened by the cap or not, unless the minister was able to piece that together with some other information.

I spoke with Dr Hollingsworth today. He says the minister told him at that same meeting in the east lobby that she had access to Dr Steve Kosar's file. He does not say that the minister saw Dr Kosar's file but that she had access to Dr Kosar's file. Could the minister tell me how she would have access to Dr Kosar's file?

Hon Miss Martel: The information I am referring to is this. If the member will take a look into the kit, he will see that Dr Hollingsworth's name is in here with respect to the underserviced area program, and so is Dr Kosar's. I received that information from the Ministry of Health when I requested information on the underserviced area program. Both those doctors are participants in the program, and for the length of time they are in the program, they are exempt from the cap. Therefore, they will be able to bill. There will be no limit to their billing. In both cases the information I had came from this information which was released publicly in Sudbury last week.

Mr Harris: The minister, in her conversation in Thunder Bay, was obviously releasing information that she now says she made up. She just lied at the time, I think is what she told us, not in the House, to try and make the point of her argument or to defend the government. But it stretches credibility that the information in that Thunder Bay conversation just came off the top of her head.

We have asked her in the past about files. She has told doctors she has seen their files: several different ones, two different meetings, two different times. She used information in Thunder Bay that would indicate she had seen files. We have heard from Dr MacMillan that confidential information has been sent out. He is not sure who has seen it, but the minister has given out information that leads many of us to believe she has seen it.

Are we to believe that she lied in Thunder Bay and now she is telling the truth? Given all the information that has come out in the last couple of days, somehow or other there is one smelly, huge coverup by her, the Minister of Health and the Premier's office.

Hon Miss Martel: Two things: Yesterday I thought I had made it clear in this House. When it was apparent I had not, I said very clearly outside that I have never had access to any confidential files, any confidential information. No one has called me over the phone with any confidential information. No one has sent me any confidential information to review. The comments I made in Thunder Bay were my own and only my own and there is no one else to blame there.

With respect to the conversation that took place here with Dr Hollingsworth and Dr Kosar, we talked about two things: the serious situation in Sudbury with respect to medical practitioners and the underserviced area program. I said very clearly to them that I had seen information with respect to their particular situation. What exactly I was referring to was the underserviced area program, which I had seen and which is a public document.

I certainly told them very clearly that they were both part of the program, that in the case of Dr Hollingsworth in particular, he was on the program until June -- therefore, at the immediate point in time there was no concern that he might leave the community -- and that it was my understanding and certainly my hope that we would have a resolution to this problem long before June of next year.

Mr Harris: We have two new pieces of information today: one, confidential information which ought not to have been released regarding a Sudbury doctor was released, was easily accessible; two, another Sudbury doctor says the Minister of Northern Development told him she had seen his confidential files.

Would the Premier not agree with me it is time to put an end to this charade? Will he ask the Minister of Northern Development to step down and will he undertake a full investigation of the Minister of Health, of how the confidential information was released and how it is being used by his ministers of the crown?

Hon Mr Rae: First of all, there is an investigation now under way by the freedom of information commissioner with respect to the statement by Dr MacMillan about information that was released that in his opinion should not have been released. I think all of us are troubled by that fact.

It is entirely appropriate that an investigation independent of the government -- the freedom of information commissioner responds directly to this Legislature -- be carried out by the commission with respect to whatever information it is, whoever it is alleged this information was sent around to or how it became available to someone outside the Ministry of Health. That investigation is taking place with respect to the statement by Dr MacMillan.

The second question, and it is a separate question, has to do with the interview this morning on Sudbury North with respect to Dr Hollingsworth. I think the minister has clearly indicated that the information she was referring to in any conversation she had with Dr Hollingsworth or Dr Kosar is information which is available, information which has been provided to the media in Sudbury and has been provided to the Ontario Medical Association, having to do with the doctors who are part of the underserviced area program.

The Speaker: Will the Premier conclude his response, please.

Hon Mr Rae: That is what the minister has told me, that is what the minister has clearly told the House, and I think the minister's word in a matter that is as basic as this is something that she has clearly given to the House with respect to whatever information she discussed with Dr Hollingsworth and Dr Kosar.

If the member has any other indications with respect to information --

The Speaker: Would the Premier take his seat, please. Supplementary?

Mr Harris: This is the third day we have been trying to get to the bottom of the matter involving the Minister of Northern Development. As each day goes by, more and more information becomes available. All we have had from the Minister of Northern Development for two days, when we asked how she had the information that she regrets having used in Thunder Bay, was the same tightly scripted, orchestrated non-answer.

It is very obvious to me, and I think to members of this House and the public, that there is an organized, systematic coverup of this whole affair going on. I would like to ask the Premier very directly: Is he or is his office involved in coaching the ministers and being part of this coverup?

Hon Mr Cooke: On a point of order, Mr Speaker: I think it has been indicated several times in this Legislature that a member of the opposition or anyone else cannot accuse another member of the Legislature of being part of a coverup. I would ask for that to be withdrawn.

Interjections.

The Speaker: Order. Regarding the point of order raised by the government House leader, on occasion allegations are made in the House, allegations across both sides of the chamber. What is most helpful, of course, is that those allegations not contain language which is inflammatory and indeed leads to disorder. In that regard I will allow the question to stand and ask that members please keep in mind that we should not use language which in fact does create disorder. The member had completed his question, if the minister could then respond.

Hon Mr Rae: I understand, and I am sure all members do, that if there are disagreements in the House with respect to something that has happened or has not happened, there immediately will be an allegation that someone is covering up or that someone is lying or that someone is a crook or a crud or whatever it may be. I want to say to the honourable member, the facts as I know them are as follows.

There will be many occasions on which we will have a chance to meet in many different forums, and I say to the honourable member, I have many disagreements with him with respect to public policy. I regard him as a man of integrity and as somebody who would not engage in a coverup within his own organization in any way, shape or form. He may choose to have whatever opinion he wants of me; that is up to him.

I would simply say very directly to him that what I know is as follows. Last week the minister had a conversation with doctors here, at their request, at which time she had information about the underserviced area program, which information was released in Sudbury, was publicly available, is information one can readily get with respect to which doctors are members of the underserviced area program.

The minister has told me and the House that she has had access to no confidential information. The question of the confidentiality of information which is referred to by Dr MacMillan is being investigated now by the freedom of information commission, which is where the investigation should take place.

I can say directly to the leader of the third party, that is what is taking place and that is what has happened. I am answering his questions as directly and as forthrightly as I can. We may disagree, but surely we have not reached the point in a democracy where people of integrity cannot have a disagreement without referring to the integrity or lack of it of the people with whom they are in disagreement.

Mr Harris: On November 20, 1990, a new government was sworn in in Ontario.

"My government's first challenge is to earn the trust and respect of the people of Ontario. My government's integrity will be measured by the way this government is run and our relations with the people we serve. Our task is to guard against institutional arrogance and the abuse of power wherever they exist.

"We will set clear standards of behaviour for the conduct of ministers...."

The longer the Premier lets this go on, the worse he is making it for everyone, including his government. Surely he does not believe that the Minister of Northern Development has credibility lobbying for access to northern specialty health services today. Surely he does not believe that.

He is making it worse for everyone. The Minister of Northern Development is either guilty of slander or she is guilty of releasing confidential information. That is the bottom line. He can try and cover it up all he wants, but those are the facts. Those are the two options.

Why will the Premier not ask for the minister's resignation today in light of the statements he made at the swearing in and in the throne speech on November 20, 1990?

Hon Mr Rae: The member for Sudbury East, the Minister of Northern Development and Mines, has told the House, has told me and everyone here that she had no access to confidential information. That is what she has said.

I would say to members, and I say to members of the public, if the minister says that and if the member has information to the contrary or if he believes that --

Interjections.

The Speaker: Order.

Hon Mr Rae: If the member has any information to the contrary with respect to the conduct of the minister, then he has an obligation to bring it forward as do other members.

Interjections.

The Speaker: Would the Premier take his seat, please.

Interjections.

The Speaker: Premier.

Hon Mr Rae: That is really what I wanted to say. The member has already indicated very clearly that she has had no access to confidential information. The minister had a heated conversation with a former Conservative candidate in Thunder Bay. She has apologized for that conversation and assured me and everyone else that she had no access to any confidential information. I take the minister at her word in that regard.

Mrs Caplan: My question is to the Minister of Northern Development and Mines. It is a simple question. We know she did not make up anything in her heated conversation in Thunder Bay; nobody believes that. We know she had access to information, even though yesterday in this House and outside to reporters she said no one gave her anything, no one showed her anything, no one told her anything and she did not see anything.

We want to know who gave the minister the information. Did her staff get it from the Minister of Health's staff? Was it from somebody directly in the Ministry of Health? Where did the minister get the information that breached confidentiality about a Sudbury doctor?

Hon Miss Martel: As clearly as I can, I have never received any confidential information about any physician or specialist in Sudbury. I have never received any information with respect to OHIP, invoices, billings or physicians.

Mrs Sullivan: Then where did she get it?

The Speaker: Order.

Hon Miss Martel: I have never had that information sent to me. I have never had a conversation over the phone with anyone who gave that to me. I have never reviewed any confidential information with respect to any physician or specialist, none.

Mrs Caplan: The minister has been in this House as a veteran since 1987. She is not a newcomer. How can she stand in her place, give those answers and expect anyone in this province, particularly people in northern Ontario she has spoken to and will speak to in the future, to believe a word she says or have confidence in anything she is saying? Does the minister not believe the honourable thing is to step aside?

Hon Miss Martel: I will say it again as clearly as I can. I have not had access to any confidential information at all with respect to billings, OHIP numbers or any income statements for any physicians or specialists. During a very heated conversation in Thunder Bay --

Interjections.

The Speaker: Order.

Hon Miss Martel: -- I made comments which I deeply regret. I made those comments, no one gave me any information, I made them myself. I have apologized as best I can. I have tried to resolve the problem as best I can and that is the action I have taken.

Mr Harris: The Premier told us he did not discuss this issue in any detail with the minister until yesterday. I am trying to get at the issue of who is orchestrating what appears to me to be a major coverup. I asked the Premier if he was orchestrating that coverup. I did not accuse him, I asked him. That was the question.

The Premier told us he did not discuss the issue in any detail with the minister until yesterday, yet on Monday, the day before he was given full details, he said that he would not consider the minister's resignation, that she had done nothing to warrant her resignation. Since he did not have all the details, as he has admitted to us and told us, on what did he base his decision on Monday that is now the decision he is going to try to defend to the death? What did he base his decision on then?

Hon Mr Rae: The honourable member uses words like "orchestration" and "coverup" and all the rest of it. We are here in the House. We are answering the questions and we are answering them as directly as we can. Any information he has is directly responded to with respect to the questions he has here. What I am relying on today is every indication from the minister that what happened was that she lost her temper in a conversation on Thursday evening and that she regrets what has happened, and clearly answers today and at any other moments that she has had no access to any confidential information.

Mr Harris: For two days when the minister was asked about the confidential information she used in Thunder Bay, she continually replied in evading the answer to the question, "The allegations I made were unfounded and untrue." That was the answer. She did not answer the question about the information. She just kept saying, "The information I used was unfounded and untrue."

Was it the Premier or his office that advised her to give that answer to whatever question came along for two days in the Legislature?

Hon Mr Rae: Question period is a time when ministers answer questions. The two conversations of any length that I have had with the minister were yesterday and today. I had another conversation with the minister today because of the information with respect to Sudbury North that was obviously on the airwaves and with respect to other stories in the newspapers. I asked the minister several questions about her explanation as to what happened. That is the beginning and the end of the discussions I have had with the minister with respect to what has happened.

HIGHWAY RECONSTRUCTION

Mr Wood: My question is for the Minister of Transportation. As the minister knows, in my riding of Cochrane North, Highway 11 plays an important role in the economic and social infrastructure by linking many communities together. What is the status of the Highway 11 four-laning project through the town of Kapuskasing?

Hon Mr Pouliot: The project that began in 1985-86 is near completion. The work will be completed in the fall of 1992. We are talking here about 350 jobs for the duration of the project. Because of its definition, because it is a link between Kapuskasing and Highway 11, yes, members have guessed it, 90% will be funded by the taxpayers of this province -- $8.89 million, value for money indeed. I welcome the question.

Mr Wood: The people of Kapuskasing have found the paving project that was completed in 1990 showed signs of premature surface deterioration in some areas. What will be done to rectify this problem?

Hon Mr Pouliot: During these difficult times, we are so appreciative and thankful that we have at Transportation a maintenance guarantee. Winter has set in; let's be cognizant of the conditions. But as soon as the snow melts, the contractor, at no additional cost to the province, will rectify the situation. It is a matter of a few months but we are right on top of it. The work will be done.

NORTHERN HEALTH SERVICES

Mr Miclash: My question is to the Minister of Health. The Minister of Health will realize that I am a member from that other part of the province, the north. She will also realize that in my statement today I quoted the Minister of Northern Development, who actually came into the House on February 8 and stated that by far the most common problem was that of attracting and retaining specialists in northern Ontario. The Minister of Health and the Minister of Northern Development are responsible for recruiting health care professionals to our northern areas.

In light of the slanderous comments made on two occasions by the Minister of Northern Development -- I am referring to the one in Thunder Bay on December 5 and the comments made in the east lobby on December 2 -- in light of those comments made by this minister from the north, against a doctor in Sudbury who was at odds with a government policy -- we know he was at odds with one of the government's policies -- what impact does the minister feel this will have on attracting health care professionals to our northern communities?

Hon Ms Lankin: The underserviced area program, which is a program that both I and the Minister of Northern Development have responsibility for, is an important policy initiative to continue to support and refine and make it even more effective.

Over the course of the last number of years, the program has effectively attracted and helped us retain a number of general practitioners in the north. The situation with respect to specialists in the north is still a problem. I think the whole discussion with respect to the thresholds and the impact of thresholds on specialists and their retention in the north, and all the attendant publicity and all the attendant discussion that has taken place here in this Legislature with respect to this issue and all the issues the member has raised, help us focus on the need to ensure that program is effective and working.

I have indicated publicly and to the Ontario Medical Association that I continue to review that program. I think we can make some changes that will make it more effective and address some of the concerns that have been raised by the specialists which have given rise to all this controversy and debate.

Mr Miclash: That was a lovely description of the program, the underserviced area program for the communities in the north. We know about that. That is not the question I asked.

When the minister talks about the underserviced areas, I look around my riding. If I take a look at the riding to the south, the riding of the Attorney General, we have three communities in that riding -- Rainy River, Fort Frances and Atikokan -- that are today looking for doctors. If I take a look at the riding of the Minister of Transportation, we are looking at Marathon and Pickle Lake, both looking for doctors to come to their area. Ear Falls in my riding is looking for a doctor today.

The question I asked the minister was, how does she feel about the statements made by the Minister of Northern Development in attracting those professionals we need in the north? We need them now. We have 30 communities that I have listed right here that need those specialists now. How does she feel about the statements made by her colleague in attracting those professionals to our northern communities? That is the question.

Hon Ms Lankin: I believe I answered the question. I said that all the debate, including many of the statements that have been made by doctors in the media and by many members of the media and the public in the north, draws attention to this issue and the need to further improvement of the underserviced area program. I believe it is not just an issue of attraction; it is an issue of retention. I believe we have to really focus on getting people the right information.

I would say, and I have said publicly in the northern media, that I think there is a tremendous amount of misunderstanding about the impact of the thresholds with respect to the practices of northern specialists. I continue to say that. I think the kind of information discussion that the Minister of Northern Development held with the two doctors here in the east lobby, which the member made reference to, specifically was trying to clear up some of that. It says to those doctors: "Here on public record it shows your period of service.

Under the underserviced area program you are clearly, by the way in which the exemptions have been set up under the threshold, not affected by the threshold for that period of time."

I think there are a number of other things with respect to the exemptions that have already been offered under the threshold program that many northern doctors do not understand. The bottom line, however, is that I agree with the member in terms of the need for improved health care services to people in the north. I think northerners have been fighting for so long, too long. Quite frankly that is where my concern lies. We will try to make the improvements with the profession that will attract and retain more specialists in the north.

NOTICE OF DISSATISFACTION

Mr Miclash: I would like to give notice at this point that I am not satisfied with the answer to that question, a very specific question, and that I request a late show.

The Speaker: The member will file the necessary document with the table, please.

MINISTER'S COMMENTS

Mr Harris: I have a question for the Minister of Northern Development. On Monday and on Tuesday in this House, and as had been quoted in numerous media reports with reference to the comments that were made in Thunder Bay, the minister said, "The remarks that were made were my own...they were unfounded and not based in fact." Could the minister tell us what those remarks were that were unfounded and not based in fact that she made in Thunder Bay?

Hon Miss Martel: No, I will not. It seems to me that I have faced up to a situation which is a very serious situation. I have offered my apologies to those involved. I do not think anything would be served by my repeating comments which were unfounded, either here in this House or in public.

Mr Harris: The minister is well aware there are two issues here. First, I and most members of the House and most observers who have read the Premier's conflict guidelines believe that if somebody maliciously slanders, in her capacity as a minister of the crown, another member of this province, she should resign. That stands all on its own. The second issue is one that is obviously going to be pursued for quite some time, and that is, who had access to this confidential information and how did it get there? That is a bigger issue and may involve more ministers and in fact even the Premier.

But on the first issue, I think what the minister said to a number of members of the public, that she now tells us was unfounded and was untrue, is important. I think what I have heard is very germane, as a matter of fact, to why it is inappropriate for her to carry on as a minister of the crown. I ask the minister again what it is she said in Thunder Bay that was unfounded and untrue.

Hon Miss Martel: As I said in response to the first question, I do not think there is anything to be gained by my repeating the details of a private conversation. The situation is bad enough. I do not think there is absolutely anything to be gained by repeating them here or anywhere else.

Interjections.

The Speaker: Order. Will the member for Willowdale please come to order?

AUTOMOBILE INSURANCE

Ms M. Ward: My question is for the Minister of Financial Institutions. The minister announced major changes to Ontario's auto insurance system, including new and enhanced accident benefits --

Interjections.

The Speaker: Order.

Ms M. Ward: I will begin again. My question is for the Minister of Financial Institutions. The minister announced major changes to Ontario's auto insurance system, including new and enhanced accident benefits for drivers who are hurt. We know that many people were not adequately compensated and in some cases were not compensated at all under the system brought in under the previous government. I am thinking in particular of children and students. Could the minister please explain how young accident victims will be compensated under his proposed reforms?

Hon Mr Charlton: There are two parts to the compensation that would flow to young children, depending on the circumstances in which they found themselves. First, they have full access to medical care rehabilitation benefits and up to $36,000 a year for attendant care, if such is required. In addition, any young student who is forced to miss a year of school as a result of an auto accident would get a lump sum of $2,000 for an elementary year, $4,000 for a secondary school year and up to $8,000 for a university or community college year.

In addition to that, the young child who is permanently injured would start receiving income replacement benefits at the age of 16, would receive $185 a week for six months and then would start the escalation to the average wage at age 30, which would be indexed for the rest of that child's life if the disabilities were permanent.

Ms M. Ward: I have also been concerned about the old system's failure to recognize the valuable work of care givers who are injured in car accidents. The benefit of $50 a week to pay for child care was an insult, and there was no recognition at all that many others in our communities work at home looking after adults with disabilities. When these care givers are hurt their dependants need outside support. Most care givers do not receive an income for the work they do and so they cannot claim income replacement if they are hurt. How is the minister planning to change the system to recognize and compensate care givers for the work they do?

Hon Mr Charlton: I thank the member for the question because this is one of the issues that has been somewhat inadequately represented in the media coverage of the package so far.

The benefits for dependant care -- that includes day care or additional assistance in the home in dealing with an adult dependant -- would move from $50 per week to $250 per week for the first child in question and an additional $50 per week for each additional child.

The member is also correct that care givers have been significantly discriminated against in the past in terms of access to income replacement benefits because they were not working and therefore were deemed to have no economic value. In the case of the care giver here, the member should know that the individual care giver would get benefits after six months equivalent to 90% of net income in terms of whatever last income they had or the base benefit in the plan.

MINISTER'S COMMENTS

Mrs Caplan: My question is to the Premier. I know the Premier has been in this House for a long time and has spoken quite a lot about the standards premiers should have. The responsibilities -- the ministerial responsibility in particular -- are something he knows about.

We have a situation where one of the Premier's ministers in the east lobby on December 2, we are told by Sudbury doctors, told them she had confidential information about them. She then went to Thunder Bay on December 5 and in a conversation in a public place told someone else she had confidential information and she disclosed that information. She returned to this House and said: "I made it all up in Thunder Bay. That wasn't true."

She said yesterday that nobody gave her any information, that she did not have any information and that she did not see anything. Her credibility is seriously damaged. The reputation of the Premier and his government's standards are in question. Does the Premier not think she should do the honourable thing and offer him her resignation?

Hon Mr Rae: I think all honourable members should do the honourable thing. When the member opposite sits in her chair and says the minister has breached her oath of allegiance, which I heard her say clearly, when she uses the word "lie" as she has done over and over again sitting in her chair --

Interjections.

The Speaker: Would the Premier take his seat, please.

Interjections.

The Speaker: Would the Premier succinctly complete his response.

Hon Mr Rae: What happened with respect to the honourable member has been described on a number of occasions in this House. I would just say to the member that the allegation she has made that the minister had access to confidential information, which the member opposite has repeated again and again, is an allegation which the minister has repeatedly, clearly and categorically denied. That is what she is saying. That is what she has told the House on a number of occasions.

If the honourable member says the minister is not telling the truth or if the honourable member has an allegation to make with respect to the conduct of the minister, let her make it with regard to the specifics of the situation.

Mrs Caplan: The fact is that the minister admitted in this House to a falsehood. She said in this House that she did not tell the truth. What does she have to do before the Premier will ask for her resignation?

Hon Mr Rae: Let me answer the member very directly. The minister has made it very clear, and it is not denied by anyone, that in the course of a conversation she had in Thunder Bay she lost her temper with regard to a particular situation. The minister has told the House on a number of occasions that she has had no access to confidential information with respect to medical specialists in the north or anywhere else.

If the honourable member is saying today that the Minister of Northern Development has seen confidential information which she should not have seen with respect to doctors, or that she has been given confidential information and has released that information, or that she has discussed information that is in the confidential file of a particular doctor, if that is the allegation the member opposite is making, let her make that allegation with respect to the conduct of the minister.

She should not hold up a newspaper article, but make the allegation herself, because it is the allegation that has been specifically denied by the minister in question, and that is what is on the record in this Legislature.

The Speaker: New question from the third party.

Mr Harris: I have a question for the Minister of Northern Development. The Premier's Conflict of Interest Guidelines, which she swore to obey and uphold, state on page 1, number 4: "Ministers shall at all times act in a manner that will bear the closest public scrutiny."

Last June the minister made and reported to this House an honest mistake, an unintentional mistake, and she offered her resignation. The Premier accepted it for a period of time. I accepted it was an honest mistake and said so at the time. At that time the minister wrote to a body she was not aware, I presume, was a judicial body on behalf of an issue she felt strongly about. It was an honest mistake but she felt it violated the guidelines and she should offer her resignation.

Now she tells us she deliberately fabricated a story and slandered a doctor's reputation. As a minister of the crown representing the government in the most sensitive and concerned issue northerners have now, access to specialists, she slandered one and deliberately fabricated a story. Can she tell me why she felt it necessary to tender her resignation in June when she made an honest mistake and not today?

Hon Miss Martel: In the first case I wrote to the College of Physicians and Surgeons, which is clearly outside and not part of the guidelines. None of us, as members of this cabinet, is permitted to do that.

With respect to the situation that took place in Thunder Bay, I got involved in a very heated conversation and I made comments which I should not have made and which were not true. It was a serious error and I recognize that. That is why I have take the steps I have to talk to those who have been involved, to say very clearly that the remarks were not based on fact and I deeply regret them. I have offered my apology for those remarks and all those people have been good enough to accept those regrets as well.

VISITOR

The Speaker: The time for oral questions has expired. I invite all members to welcome, seated in the Speaker's gallery, the Honourable Louis Jones, member of the House of Assembly for St Vincent and the Grenadines. Welcome to Ontario.

PARLIAMENTARY LANGUAGE

Hon Mr Cooke: On a point of order, Mr Speaker: During question period I raised with you the language being used by the members of the opposition parties and in particular the language of accusing another member of the Legislature of being involved in a coverup.

You did not rule and I would like to point out to you, Mr Speaker, that this language has been ruled on December 8, 1983, by Speaker Turner, on December 16, 1983, by Speaker Turner, and on July 11, 1985, by Speaker Edighoffer. It is inappropriate language to use in the Legislature.

Mr Speaker, I think it is incumbent on you to follow the precedents in this place and rule to not allow that kind of language to be used in what can only be described as an attempt by the opposition parties to engage in a character assassination in this place this afternoon.

Mr Harris: To the same point of order, Mr Speaker: I will try in minimal time to minimize my absolute disgust at the words coming from that member with all the things he has on record in this Legislature in his career. Absolute disgust.

Speaking directly to the allegation, I believe he was referring to me. Mr Speaker, if you check the record and find I have accused a member of the cabinet or the Premier of a coverup directly in my remarks, I will withdraw them. If you check the record, you will find I said there is a coverup and that is obvious to all. I asked the Premier if he was involved in that coverup. I did not accuse him; I asked him to explain if he was involved or not and I stand by that.

Interjections.

The Speaker: Order. The honourable House leader for the official opposition has a contribution to make to this particular point of order.

Mr Mancini: On a point of order, Mr Speaker: I, like a lot of other members, was listening very closely to what was being said today. I do not agree in any way with the accusations being made presently by the government House leader. In fact, I consider some of the words he has used, such as "character assassination," out of order.

I think all honourable members do use language which you consider to be intemperate at times, Mr Speaker. That does cause a lot of honourable members to make interjections, whether they are in order or not. I think that is the situation we have today, nothing more.

The Speaker: To the government House leader's point of order: First of all, I appreciate the contributions made by the other two members. Members will know that indeed I have a grave concern with respect to the language level that is used in the House. I have never viewed it that intemperate language is a way to accomplish the public business nor to maintain order and decorum in the House.

While the members will know there is no dictionary or list of unparliamentary terms, at the same time I take the point raised seriously. I will indeed be pleased to review the record and to examine the references to which the honourable member refers.

VISITOR

The Speaker: I would be remiss if I did not invite all members to recognize and welcome to our chamber this afternoon, seated in the members' gallery west, the former member for Dufferin-Peel, Mavis Wilson.

REPORTS BY COMMITTEES

STANDING COMMITTEE ON GOVERNMENT AGENCIES

Mr Runciman from the standing committee on government agencies presented the committee's 21st report.

The Speaker: Pursuant to standing order 104(g)11, the report is deemed to be adopted by the House.

STANDING COMMITTEE ON THE LEGISLATIVE ASSEMBLY

Mr Duignan from the standing committee on the Legislative Assembly presented the report on the Review of the Freedom of Information and Protection of Privacy Act, 1987, and moved the adoption of its recommendations.

Mr Duignan: The committee undertook its year-long comprehensive review of the Freedom of Information and Protection of Privacy Act, 1987, as directed by

section 68 of the statute.

As Chair of the committee, I offer my thanks to all members of the committee who acted in a very non-partisan way, and the report is basically a unanimous report of the committee.

It was a pleasure for all of us working together to learn about and contribute to the issues of such importance for citizens as open access to government information and protection of individuals' personal privacy.

I would like to express the thanks of the committee to all those who appeared before us or wrote to us with their submissions. In particular I would like to thank the Chairman of Management Board of Cabinet and his staff, Frank White, director of the freedom of information and privacy branch, and Tom Wright and his associates and staff. I would also like to acknowledge the expert help of our research officer, Andrew McNaught, together with the assistance of the committee clerk, Doug Arnott, and clerk pro tem of the Canadian Senate, Nicole McMillan.

I do not have time to review all the recommendations.

On motion by Mr Duignan, the debate was adjourned.

INTRODUCTION OF BILLS

TASMAQUE GOLD MINES LIMITED ACT, 1991

Mr Miclash moved first reading of Bill Pr114,

An Act to revive Tasmaque Gold Mines Limited.

Motion agreed to.

PITTSONTO MINING COMPANY LIMITED ACT, 1991

Mr Miclash moved first reading of Bill Pr115,

An Act to revive Pittsonto Mining Company Limited.

Motion agreed to.

PETITCLERC MINING LIMITED ACT, 1991

Mr Miclash moved first reading of Bill Pr117,

An Act to revive Petitclerc Mining Limited.

Motion agreed to.

SUNBEAM EXPLORATION COMPANY LIMITED ACT, 1991

Mr Miclash moved first reading of Bill Pr116,

An Act to revive Sunbeam Exploration Company Limited.

Motion agreed to.

HOTSTONE MINERALS LIMITED ACT, 1991

Mr Miclash moved first reading of Bill Pr113,

An Act to revive Hotstone Minerals Limited.

Motion agreed to.

ORDERS OF THE DAY

FINANCIAL ADMINISTRATION AMENDMENT ACT, 1991 / LOI DE 1991 MODIFIANT LA

LOI SUR L'ADMINISTRATION FINANCIERE

Mr Christopherson, on behalf of Mr Laughren, moved second reading of Bill 156,

An Act to amend the Financial Administration Act / Projet de loi 156, Loi modifiant la

Loi sur l'administration financière.

Mr Christopherson: The Financial Administration Act sets out the responsibilities of the Treasurer in managing the financial position of the government. It is therefore very important that it be up to date with the latest financial management practices and procedures. The Financial Administration Act has not been substantively revised in almost 10 years. In that time major changes have taken place in the financial markets, including the introduction of increasingly sophisticated and complex financing instruments.

In addition, the borrowing program of the Ontario government has undergone major change, resulting largely from the decision to stop using public sector pension plans as our main source of capital.

I am moving second reading today of this bill, on behalf of the Treasurer, to ensure the province can operate an efficient and effective borrowing program that will minimize its borrowing costs. The amendments will allow the province to use contemporary borrowing mechanisms such as the issuing of debt denominated in European currency units and index-linked securities that will enable the province to take advantage of financing opportunities not currently available to it because of restrictions in the act. The amendments will allow the province to support the development of non-bank financial institutions by making them eligible for investment of our government funds.

The amendments will allow the province to enact a framework for the new capital fund announced in the 1991 Ontario budget. This new approach to accounting for expenditures will improve decision-making by drawing a distinction between operating and capital expenditures.

The amendments will increase the province's ability to effectively control its financial position and to increase the return on its investments by permitting the use of more contemporary investment vehicles. These changes will also improve the province's ability to manage the risk associated with its portfolio. The amendments will provide additional operational flexibility to commercial activities of ministries and crown corporations and agencies. This will allow these operations to be run in a more businesslike manner.

Finally, the amendments will increase the province's ability to co-ordinate the borrowing activities of its portfolio of crown corporations and agencies.

Mr Phillips: The major part of this bill that concerns us is the establishment of the capital fund. It is quite clear that the fundamental intention of this is to allow the government next year to report a deficit that will probably be reported at $5 billion less than this year. It is a neat trick because they will put the capital expenditures into debt.

The Premier has been very careful throughout all our discussions, as has the Treasurer, to say it is the government's intention to balance the operating budget of the government. The way they are going to do that is to take the approximately $5 billion the Ontario government must spend to refurbish the infrastructure each year and put all that into debt. That is a neat trick because it will allow the government to say next year's deficit is only $3.5 billion instead of $8.5 billion. The public will perhaps have difficulty in understanding that the $5 billion of capital is hidden away in debt.

All that will show next year on the financial statements will be the interest payments for that one year on the $5 billion worth of debt. That will probably mean an interest charge of maybe $250 million. I applaud the government's nerve in this respect, because it is neat, and the Treasurer, when he stands up here on April 23, 1992, will say: "Amazing, amazing. The deficit now is only going to be $3.5 billion."

If this were the private sector -- the capital paper points this out -- the government would show depreciation charges of probably $5 billion, because that is what it costs just to keep the provincial infrastructure refurbished each year. This is not like a one-time only thing where I am buying a house and I am going to take a mortgage out on it. Every year, as the capital paper and the budget point out, the province needs to spend $4 billion to $5 billion in refurbishing the infrastructure. Make no mistake about it: This little bill has one major objective in mind and that is to help the government's finances look neat.

This is not the first thing they have done. They have asked Ontario Hydro to pick up many of the expenses for assisting communities that normally would have been shown as expenses on the budget statement. It will not be the last thing they will attempt to do, because they are desperately trying to find a way to make the numbers for next year look good. But for me at least, this is a move that will disguise the true financial picture of the province.

Having said that, the Treasurer, at one of the meetings of the standing committee on finance and economic affairs, said something like, "The people of Ontario are smart enough to see through these things and they will appreciate that our deficit next year will in fact include the capital." However, this move will, in my opinion, permit in the budget statement next year an understatement of the spending in the $4-billion to $5-billion range.

I suggest our fundamental concern with this one is public disclosure and ensuring the public understands that what this bill will do is simply hide expenditures that must be made each year in debt. The provincial debt will go up by an additional $5 billion, and the only thing that will be shown on the financial statement will be the interest charges on that $5 billion worth of debt. As we look at this bill, that is our fundamental concern. It is full disclosure, the fundamental concern about how the province plans to account for its refurbishing of the infrastructure of the province.

As I said, it is not surprising the government would want to do this because it is a neat little trick to make the finances look substantially better.

Just to touch briefly on some of the other aspects of the bill, I think it is time we updated portions of the Financial Administration Act. As it was pointed out in the parliamentary assistant's opening remarks, there are needs to take into account. We are now doing different ways of raising funds and we need to make sure the administrative language catches up with that.

But back to our fundamental concern: We think this bill will perhaps not fully disclose the financial picture of the province. If this were a private sector organization it would show, we suggest to members, $5 billion worth of depreciation. All we will see next year in the budget -- I believe in the Treasurer's initial comments he released in April 1991 -- is perhaps $200 million worth of interest charges. That will be our concern about the bill.

The other somewhat administrative areas of the bill seem to be appropriate. We will be looking for some assurance that the government plans full disclosure of the real debt, that we do not see this used as a way to accomplish, we think in an inappropriate way, the Premier's pledge to balance the budget in 1997-98. The only way they plan to balance the budget in 1997-98 is by hiding about $5 billion a year in expenditures and debt. The problem with all that is that it will eventually come home to roost.

If they are not paying for the capital infrastructure on a year-to-year basis essentially just to refurbish it, if they put it all in debt, they have just postponed the financial problems for the province.

We will be looking in the bill -- we do not see it as yet -- for assurance of full disclosure of the real financial picture in the province and to ensure that this capital fund not be used to hide the true financial picture.

Mr Tilson: In response to the member's remarks, I think one of the concerns that can be put forward on this bill is that during the last election it was advised by the former government that there was a surplus of $11 million. This was prior to the election being called. Then the election came along, we went through the summer and of course the NDP was successful in the election and it was announced by the Treasurer that there was a $700-million deficit.

All that creates cynicism among the public. Who is telling the truth? Who is playing with what books? I think that is part of the issue the member is raising. Is the putting forward of this bill another opportunity to enable the Treasurer of any particular government to play with the books, to create an illusion of whether there is a deficit or no deficit? We know the government is in trouble. We know the deficit is much higher than what is being alleged. Is this is a bookkeeping method that would lessen the impact of the deficit? It creates, I would submit, a form of cynicism among the public as to exactly what this government is trying to do in hiding a deficit.

Mr Phillips: Just in a specific way on one of the comments of the member, it may be helpful to the member that in his report the auditor looked at the source of the deficit this year and explained it, I thought, in fairly good detail. Just as an aside, he may want to look at that.

He raises the issue that worries me and that is that the government is desperate to show the public a different financial picture than reality in the capital accounts, a neat thing to do because it will hide in the debt about $4.5 billion to $5 billion worth of expenditures each year. It will only be in about six years that the interest payments on all of that money put into debt will come home to roost. But of course that will be long after the next election.

The Premier is counting on this capital fund, counting on being able to say, "Listen, we balanced the budget. We are miracle workers." But the only way they will balance the budget in 1997-98 is through this little trick. We must have assurances that we will have complete disclosure of the true deficit, that is, the capital plus the operating -- and the Treasurer did say in our economic committee that he agrees there is the need for full disclosure -- so the public see that the real deficit is the operating deficit and the capital deficit.

We will need assurances that it is the government's intention that it will be fully disclosed, that the deficit reported will be the deficit of the operating and the capital account, and not just for one year. Otherwise we are playing with the books. We are fooling the public into believing that the economy, the financial picture, is better than in fact it is. The books have been set up in this way for many years, with capital and operating together. If we do not have a consistent basis for comparison we will not have a true picture.

Mr Sterling: I, like the previous member, have some concerns with the creation of the capital fund. Over the period of time I have been in this Legislature I have seen new treasurers, new governments come in and attempt to change the style and the method of keeping the books of the province. Therefore it is very difficult for the opposition and almost impossible for the public to go back and compare the records of the previous government versus this government as to their spending practices.

It will be very difficult, for instance, to know whether or not the amount of money going towards capital is higher or lower than normal in any given year, because we do not have a history of that kind of spending. Of all the documents the government produces each year perhaps the most important document is the budget, which is presented to us usually in the spring of each year.

At that time we look at the document and we try to determine whether or not it is a reasonable document in terms of the spending and the taxes which are collected in order to support that spending. Now we are going to have a change in the method of keeping those books, and I am always somewhat suspicious when a treasurer or a government goes to change the set of books.

One of the problems I have also, in terms of debating this bill in the kind of depth it probably deserves, is that it was introduced on November 21. That is little more than two and one half weeks ago. While the Treasurer indicated in his budget of last May that he was going to bring forward these kinds of reforms, it was only two and one half weeks ago that the legislation was tabled. Quite frankly, the legislation is very difficult, very complex and therefore probably requires a number of people to properly respond to that kind of legislation.

I only say to the parliamentary assistant for the Treasurer that the Treasurer's desire to have this passed by the end of the year or the end of this session will probably lead to a bad piece of legislation, an incomplete piece of legislation, or a piece of legislation which could be improved free of charge by the people who are involved in this kind of business.

I was sent over a compendium for this bill. As members read through the compendium they may be able to understand how --

Mr Tilson: On a point of order, Mr Speaker: I do not see a quorum.

The Deputy Speaker ordered the bells rung.

Mr Sterling: I was referring to the complexity of Bill 156 and the fact that I, as a legislator, going into the last two weeks of this Legislature and having only seen this bill over the past week and a half, have not really been able to obtain from the community at large its opinion about this legislation.

For instance, earlier this week or late last week, I cannot recall which, I phoned the Provincial Auditor, Mr Douglas Archer, and asked him whether he had any opinion with regard to this legislation: Is the capital fund, in the way it has been set up by the Treasurer, a fair accounting practice, and is it an objective way to set out capital expenditures when compared to other jurisdictions? I understand other jurisdictions have capital funds allocations within their budgets. I was perhaps somewhat shocked by the response I received from the auditor.

He had not been consulted by the Treasurer, he had not been informed that the legislation had even been tabled in this Legislature and he had not put his mind to it. I did receive a call from him this morning, and I have been unable to connect back with him.

That is one of the problems we have faced with regard to this government, not only dealing with this legislation but there is another piece of legislation, dealing with some amendments to our municipal laws dealing with their powers to debenture, which was only introduced last Thursday. As we go into these last two weeks, I get the feeling this is the kind of bill that does not have what I call the proper pacing to it. I believe if you want to have good legislation in this Legislature there should be a proper time frame and a proper distance between the time it is introduced, the time it is debated on second reading and the time it is called to third reading.

It is not so important to us that the bill goes from first to second reading in a very quick time and then possibly out to a committee of this Legislature. I am not certain that has been the intent of the Treasurer at this time, but perhaps we will seek that when the time comes to send this, after we have a vote on this particular piece of legislation.

I was referring to the complexity of it. I wanted to say that the glossary of financial terms is enough to scare you. For any person in this Legislature who understands the glossary of terms, I really challenge that person. For instance, it refers to FRAs -- forward rate agreements -- financial futures, options, bond options -- swaptions. Swaptions? I thought that is what they did at the Liberal Christmas party last night. No, I am sorry; that was wrong. I should not say that. Excuse me.

It refers to currency swaps, interest rate swaps, caps, floors and a collar. What I think about a collar is what you have around your neck, but a collar is an agreement with a cap and a floor. This is just so members know what this bill is all about and so they can understand the concern I have in terms of giving this bill the kind of quick and speedy passage which the Treasurer and the government House leader seek in this Legislature this afternoon.

I am also disturbed, quite frankly, when we go back to budget paper D of the budget, which explains what the Treasurer wants to do with regard to the capital fund. If you look at his example on page 83 of last year's budget, the implication there is that for every dollar of capital expenditure made this government will allocate a dollar of debt towards that capital expenditure.

I think what the government is trying to do is create the guise or the parallel of a balance sheet in the private world. What it is trying to do is create the comparison of a capital expenditure in the private world -- private corporations, private businesses -- versus a capital expenditure in government. I guess the philosophy behind that is that if they create a dollar's worth of expenditure and it is going to go forward for a number of years, it should be written off over a number of years.

I agree with my colleague with regard to the depreciation argument. In addition to that, in the private world, when a company or even an Ontario corporation like Hydro goes into an investment, it does pay down some cash on the investment. So the borrowing is not necessarily 100% of the capital asset which it produces. As I understand from reading this document, none of the costs of the capital improvement will be charged against the first year of the capital when the particular project is constructed.

I guess the other part that concerns me is that if they are going to create the scenario of a balance sheet type of government -- and we do not have a balance sheet in government because it is very difficult for the government to add up all our assets at any one time -- and are going to start to create the whole idea of a capital account, they also have to look at what the liabilities are doing during a particular year. These should be reported on in advance if they are foreseeable, or they should be reported the year after if they occur the year after.

We all know that, for instance, the Workers' Compensation Board -- which I consider a government liability even though it is supposed to be at arm's length, an employer-owned compensation plan -- went into a further $1-billion liability position over the past year. I do not know where Ontario Hydro is at at this time, but I understand its liability position is probably worse than a year before as well.

It is also not clear from the example that when the Treasurer sells off the SkyDome, which he has just done and which is $130 million, whether he will count that off against the capital spending he is going to undertake. If they are going to be accurate in terms of their capital accounting, they have to say, "Well, we're spending this money to improve our stock, but if we sell off land or if we sell off an asset like the SkyDome and receive compensation," what should be said in their document is that it should come off the capital account.

I am not clear from the budget paper whether the interest payments that will accrue as an expense of the government remain purely a part of the operating budget or if they tack on to future capital accounts within the accounting process. I read at the bottom of page 82:

"The capital fund will invest in Ontario's infrastructure through payments for capital projects approved during the estimates process. Money will flow into the capital fund from the operating fund through...debt interest payments from the operating fund to cover debt service costs."

I mentioned earlier that what seems to be the setup is that if $5 billion next year is spent on capital, $5 billion of debt will be appropriated against that capital. I am not certain, from looking at budget paper D, whether next year when, let's say, $500 million is required to pay the interest on the $5 billion, that will become part of the capital budget for next year.

If so, as time goes on, the capital spending will not only reflect what is being spent on hard buildings or hard services, infrastructure, but will also include the debt-servicing charges associated with debt which has been allocated to this capital fund. I would be very upset if that were the case. I consider the interest charges associated with the capital to be a part of the operating costs of government in future or subsequent years.

That pretty well completes my remarks. I would like to hear from the parliamentary assistant if it is his intention to send this out to the standing committee on finance and economic affairs, of which I happen to be a part, because I have come to the conclusion that would probably be the best path for this bill to go. I would have preferred that we dealt with it during the legislative process, but since this has come at such a late date, we would prefer it to go to committee so we can have some experts come in and talk about whether this is a fair process. We can have the Provincial Auditor come in and say whether this is a fair process.

Mr Phillips: I have a few comments. I want to thank the member for his comments and for sharing some of his sentiments that our Provincial Auditor could provide us with some valuable input on this. I am surprised also that he has not had an opportunity to review it because, after all, he comments on our accounts and has the public responsibility for ensuring that we accurately reflect the true financial picture.

As the member said, I believe there is a meeting of the standing committee on finance and economic affairs this week. It is possible that we could have the auditor in for a review and comment on this because there is no doubt, as the member just said, that this is a fairly fundamental change in the way we are going to report our budget and finances for the province. It is a great move for the government because it will be able to stand up and say, "My gosh, the deficit is $4.5 billion less than we said." That has nothing to do with the spending cuts; it is just a different way of reporting it.

I think there is some merit in hearing the auditor's comments on it, and it will give the new auditor a chance to ensure that if he can suggest improvements in the bill, we have that chance to incorporate them. Otherwise, we are going to be asking the new auditor to report the finances on this new basis without any input into its merits.

Mr Tilson: I too support the member for Carleton, who has requested that this matter be sent to committee. Obviously the two members who have spoken to date on the subject are concerned about the issue of accountability. They are concerned about the issue of spending by all governments in this province.

We are, it would appear, giving the Treasurer substantially more powers to borrow and more powers to purchase. It would be interesting to have remarks from such people as the auditor or others on the justification, the rationale, for providing these increased powers.

As I understand it, the bill increases the amount the Treasurer may raise by a temporary loan from $215 million to $4 billion. That is a substantial increase.

It would be useful to hear comments on that subject, and on the subject, just an interesting question, of subsection 21(1), which says, "The Lieutenant Governor in Council may by order authorize the Treasurer, on behalf of Ontario, to agree to guarantee or indemnify the debts, obligations, securities or undertakings of any person."

What does that that whole issue of guarantee mean? The whole issue of powers, the whole issue of why we are doing this, other than the fact that we have not done something for 10 years, needs to be looked into. I think a more appropriate time would be in committee, in light of the fact that this matter was only introduced on November 21. Certainly I think some of our concerns could be eased if this matter were dealt with in committee.

The Deputy Speaker: Any further questions or comments? The member for Carleton, you have two minutes to reply.

Mr Sterling: I have long felt that one of the problems we always have in this Legislature is that we shout back and forth at each other in terms of whether or not a government has delivered on a program or is accountable with regard to what it is doing.

As I mentioned earlier in my speech, the most important document of all in terms of accountability is the budget the Treasurer presents each year. If the Treasurer is being forthright in what he said yesterday in this Legislature, that he is anxious to change the budget process, then when his budget comes down in April or May of next year if he wants a sane, even or objective kind of reading of that budget, surely he must present those figures in a manner which in some ways is objective and logical to those who are involved in the accounting or investment fields.

We are not quite sure whether the intention here is to change the process to make governments in the future more accountable or whether this is a change in the process to create more smoke, more confusion in the public's mind, than has been there in the past. I hope it is the former. That is why I would like to sit down with a committee and determine how the books for this province should best be kept and do it in a manner so the Provincial Auditor agrees with what the Treasurer is doing.

Mr Turnbull: I have somewhat similar comments to make about this bill. We received this document on November 21 and were told that the government would like it passed by Christmas. I suggest this is a rather significant change in terms of how we operate the finances of this province. There is no doubt we probably need to update the way in which the Treasurer reports various pieces of information and indeed the way in which he can approach short-term borrowing, but I am particularly concerned about some of the aspects.

The act proposes that the Treasurer would be able to establish accounts with non-bank financial institutions such as trust companies, credit unions, and caisses populaires. It is quite clear that in the past there have been some difficulties with trust companies. With all due respect to my friends across the floor, they have certainly been very vociferous in their objections to what previous governments have done with respect to trust companies. I notice that slid in with this is also credit unions. Is this a way of somehow supporting their friends with the credit unions?

We need more scrutiny of it. I am not saying it is bad, but we really need to have public input. I would particularly like to hear what the Provincial Auditor has to say, and the fact that he has not had time to comment to us is somewhat of a concern. We should not be pushing through legislation which will significantly change the way the government will operate unless we understand all of the implications.

The rise in the borrowing limit from $250 million to some $4 billion is a rather huge jump to take in one fell swoop, 16 times the borrowing level. We know this is a government which is spending somewhat out of control -- I would only withdraw the word "somewhat" but certainly "out of control" -- and we need to get public accounting into the system of that.

The further concern I have is that if we start separating out the capital account -- which, by the way, I would suggest is a good idea -- in principle, I think we should have an accounting for capital investment in a separate set of books to the operating accounts. However, it would be good practice to make sure that we are going to have accounting for the funding of those capital accounts.

Any debt service should be accounted for in the operating budget, not in the capital budget, because there is this terrible, almost irresistible urge the government will have to move things into the capital budget and say to the taxpayers: "Look how fiscally responsible we've been. We've reduced the deficit. Look, we've only got a $4-billion or $5-billion deficit."

The fact remains that all governments prior to this have always spent on capital. It has not been accounted for in a separate account, and I think it should be. I would like us to have a review at least of the last 10 years and see how much has been spent on it so that we have some retrospective view of this when we are looking at future budgets where they say, "This much is capital and this much is operating."

The temptation to play with the books is there, and I really do not believe we should allow this legislation to pass without public scrutiny. Public scrutiny would involve having the best financial minds commenting on what the implications for the province in these accounting methods would be in so far as the borrowing restrictions placed on the Treasurer are concerned, and commenting on the implications to the province's credit rating of raising the borrowing limit from $250 million to $4 billion. I think that would be appropriate.

The famous saying was, "There are lies, damned lies and statistics," and I suppose I am concerned that we are going to get statistics in the future which will bamboozle the taxpayers who are already paying too much money and then find out after the fact that the government has been irresponsible, and I would say that is governments at all levels.

Mr Christopherson: I would like to begin by thanking the honourable members who participated in the debate for their constructive comments and concerns.

I would like to acknowledge concerns raised by virtually all those who spoke: the member for Scarborough-Agincourt, the member for Dufferin-Peel, the member for Carleton, the member for York Mills -- I hope I have left no one out -- who all expressed some concern as to whether the government was in effect trying to perform a neat trick, as one honourable friend said and as others have said, or to cook the books or to play smoke and mirrors with the figures.

The reality is that what we are attempting to do here are some very simple things. First of all, we are attempting to bring the borrowing ability of the province up to the 1990s. That is required not only because we have not made any changes for 10 years, but also because we no longer use the public service pension fund as a significant source of money to borrow from. We are out in the international markets much more than we have ever been in the past.

We need better tools, meaning the legislation, to allow us to participate in a full capacity that will allow us to benefit and maximize the taxpayers' benefit from the market system as much as we find it necessary to participate in those markets.

Also, I would quickly point out that much of the legislation here, and in particular the separation of the operating fund and the capital fund, are measures that are used by many governments across North America. This is not unusual. I think a number of the members who spoke acknowledged that this was a wise and prudent move on the part of the government in terms of allowing us, and indeed the taxpayers, to have a better idea of the financial picture of the government of Ontario.

When I mentioned our participation in international markets, I am told, as an example, that if the capital markets branch borrowed in denominations of the European currency unit, the ecu, we could save the taxpayers an estimated $9 million on a $400-million bond issue. I think that is a significant sum of money and is an example of the kind of benefits that would accrue to the taxpayers of Ontario if we made the changes the Treasurer proposes to make.

I would also acknowledge the concern raised by the member for York Mills, who talked about the line of credit increasing from $250 million to $4 billion. Again I would add, that has not been changed in 10 years. We are borrowing larger sums of money, as have previous governments, than we have in the past. I am told that the banks and financial institutions that extend this line of credit to us have no problem with it whatsoever. It has no effect on any kind of bond rating factors that play into those decisions.

Also important, because I think the member raised a very important question, is that it has nothing to do with the ability of this government to borrow or the with amount we borrow or with how much debt we may be incurring as a government. Rather it is the ability of the government of the day, regardless of what party is on this side of the House, to access the kind of money needed in the 1990s to pay the bills of the province, if for some reason the transactions that are taking place around the world do not leave the kind of money we need in the accounts at the time we have to have them.

This is a line of credit that is available to us on a very short-term basis to ensure that we are not caught without the ability to pay the commitments we have out there. There is nothing there that anyone need be concerned about. It is another tool to allow the government of the day the opportunity to run the government as it is mandated to do when it assumes power.

I would also like to spend just a moment, before I close, on the issue of the capital fund and the amount of money that will show for debt and interest on the debt and what will happen when it is reporting time. I want to say unequivocally on behalf of the Treasurer that there is absolutely no intent to hide or play any games whatsoever.

In fact, I would hasten to add that were the Treasurer to play any games whatsoever and get caught, he would probably do more damage to his credibility and his ability to answer and speak on behalf of this government, as he must in accounting for the billions of dollars this government must answer for, than probably anything else he has proposed at this point.

First, we have the assurances of the Treasurer, but also, I suggest, the commonsense analysis that he quite frankly cannot afford to play any games with this. I am saying on his behalf here publicly in the House that there is no intent to do that. I encourage members opposite that if they find something that gives them a problem, to please point it out in committee or in the House, because if there is something there that is not showing in the way they think it should, the Treasurer wants it to be reflected as appropriately as possible.

I answer, by way of a technical response, that the operating deficit plus the capital deficit will show separately and they will also show as a consolidated deficit, and the interest payments on both will be applied to the operating and the capital separately.

In closing, I would again like to thank, on behalf of the Treasurer, all the members who participated in this most important matter. I will make sure their concerns are raised with him. I want to again thank the assembly, assuming it is prepared to pass this today, for allowing the government the opportunity to benefit as much as possible from the kind of financial tools and instruments this legislation will put at our disposal, so that when we are dealing with the billions of dollars the taxpayers have entrusted to us, we are doing it in the most effective and efficient manner possible.

The Acting Speaker (Mr Farnan): Mr Christopherson, on behalf of Mr Laughren, has moved second reading of Bill 156. Is it the pleasure of the House that the motion carry?

All those in favour will please say "aye."

All those opposed will please say "nay."

In my opinion, the ayes have it.

I have a letter of deferral pursuant to standing order 27(

g) that the vote on the motion by Mr Laughren for second reading of Bill 156,

An Act to amend the Financial Administration Act, be deferred until immediately following routine proceedings on Thursday, December 12, 1991. Is there unanimous consent?

Hon Mr Cooke: Mr Speaker, there is unanimous consent that we have the vote this afternoon at 5:45, and there will be other stacked votes.

The Acting Speaker (Mr Farnan): Is there unanimous consent that this be deferred to 5:45 this evening?

Agreed to.

Vote deferred.

LEGISLATIVE ASSEMBLY AMENDMENT ACT, 1991 / LOI DE 1991 MODIFIANT LA

LOI SUR L'ASSEMBLÉE LÉGISLATIVE

Mr Cooke moved second reading of Bill 163,

An Act to amend the Legislative Assembly Act / Projet de loi 163, Loi modifiant la

Loi sur l'Assemblée législative.

Hon Mr Cooke: Very briefly, this is a bill to amend the pay rates for members of the Legislature. Members of the Legislature will remember that the last time there was an adjustment to this act and to the salaries for members of provincial Parliament was on April 1, 1989. I believe that increase was in line with or a little less than the cost of living at the time. Then the election intervened and that is why there was not an adjustment to the pay for 1990.

This pay bill will affect the pay scale for MPPs effective April 1, 1990. It is a 3% adjustment across the board. I should point out that it has been announced it is the intention of the government that there will not be a pay increase for the next fiscal year or the fiscal year after that because of the difficult times the province is experiencing now. It also should be pointed out that normally, when we are dealing with pay bills, there is an accompanying bill that would amend the Executive Council Act. We are not doing that.

There will be no adjustment of the salaries of cabinet ministers for the fiscal year 1990-91 either, which in effect freezes the additional pay to cabinet ministers and parliamentary assistants for three years.

I know the strong feelings that members of the Legislature have. I certainly remember the position I have taken in the past on behalf of my caucus on this matter, and I still believe very strongly it should be the goal of this Legislature to eliminate the tax-free portion of our pay. That would require of course that the gross amount would have to be bumped up to allow for the net take-home pay to remain the same. I think it is appropriate that there should be no tax-free allowances and that we should pay tax on all our incomes in the same way all our constituents do.

That matter was looked at by me this time. The problem and the difficulty it creates for us right now is that it would mean an approximate increase in pay for each member of about $7,000. Even though the take-home pay would remain the same, the cost to the Legislative Assembly and therefore to the taxpayers of this province would be an additional $7,000 per member of the Legislature, which works out to nearly $1 million -- $900,000 to $1 million -- which simply cannot be afforded by the province at this time.

In addition to the elimination of the tax-free portion, I believe very strongly we need to look at and implement a fair system of annual adjustments so that we do not go through this every year or every second year or whenever it is decided it will happen. The way members are paid in this place is inappropriate and it is too low, but it is not possible to make those major adjustments to our pay scale now with the economic circumstances the province is in.

While this is inadequate and does not provide the kind of reform I believe in, that the government believes in and that I believe members of the opposition believe in as well, at least it rectifies the problem that there was no adjustment in 1990 because of the election and allows for some minor improvements in pay. It is inadequate and it is unfortunate, but I hope that at some time in the near future when the economy picks up, we will be able to work together to find a proper way of paying members of the Legislature and a proper way of eliminating the tax-free portion of our allowance now.

Mr Conway: I have some comments, but I know my friend the leader of the third party has some pressing engagements and I know he is interested in getting into this debate, so I am quite prepared to defer to him in this round.

The Acting Speaker (Mr Farnan): I think we can accommodate that.

Mr Harris: I do not wish to dwell on this at great length, but I do want to get a few things on the record, some with reference to the comments the House leader for the New Democratic Party and for the government has made.

I believe the public has said three things to me over a considerable period of time, off and on I guess since I have been elected. We have had a Conservative government during that period, we have had a Liberal government and now an NDP government and none of the three things I have heard has been addressed.

I am a little discouraged with that, of course. There are always reasons. We had the wage and price restraint program in the mid-1980s when we were in government. We had David Peterson, who really did not have very much courage to do anything tough during that time. I do not have many kind things to say about the Liberals in that regard. Then we had the New Democratic Party and I do not have many kind things to say about them in this regard. They were so vocal in opposition. I do not have much that is kind to say about 1981 to 1985 either, in not addressing what I think are the three major concerns.

I could stand here all afternoon and read back quotes of the House leader, the Premier, the former leader of the New Democratic Party, talking about --

Hon Mr Cooke: I read them this morning.

Mr Harris: The House leader says, "I read them this morning." I think the inappropriateness of at least two of the items I am going to talk about is a matter of long-standing record. I have not heard very many politicians talk about the third, but the public talks about it -- pensions.

The three things really are pensions. Our pensions are pretty good. Obviously it is a matter of judgement whether they are too good or not good enough, but can you get the accounting procedures to say they are fully funded by contributions, either by ourselves or by the government? That is a concern to the public.

The second concern on pensions, that they are indexed, is actually not true. The federal pensions are indexed. Ours, as you know, are not. They are open to adjustment at the discretion of the Legislature. Normally such adjustment parallels whatever increases are afforded to the current MPPs. That, of course, is substantially different than indexing and, I think, a much better way. If there is a time for restraint there should be a period where nobody gets a raise.

I believe we have gone through a year of that already and I am most distressed that the government missed the opportunity to show leadership in that regard, starting with the Premier, the cabinet, us, all the way through the public service and the extended public service. I have spoken on that on many occasions. Now we are reaching a year where the government is recognized. They were in error last year, things got away from them and out of control and now some restraint is being brought forward that, I assume, would apply to the pensioners as well, the 3% and the zero-zero.

I am going to talk a little bit about pensions. I will come back to that. The second aspect the public is most concerned about is that we vote these things for ourselves. We make a decision and vote ourselves a pay increase. Some will say, "Well, that is your responsibility and you should be accountable for it." I know some municipal councils have dealt with this in such a way as to set the wage scale, if you like, for their positions at the expiry of one council for the next one. It is out there, up front, you know what it is going to be for three years and you can run for the position on that basis and the current council never sets the salaries for itself.

That may be one way we could look at it. Another way, of course, is to have our salaries set by some other form of independent body, either the Commission on Election Finances or an independent body in a constituent assembly-type mode. I would suggest to members that that body should represent the people, the taxpayers, who are looking for good people to run, good government and quality representation. They are also concerned about the taxpayers' dollars. I think we would probably find that if we had that appropriate body we would arrive at a fair figure and we would take away voting or not voting ourselves a raise and how much it is going to be.

The third aspect I hear a fair bit about is the tax-free one. You get all these tax-free perks when you are on council or when you are on the school board. I will not be popular now with the thousands and thousands of people who are trustees or who are on local councils, and perhaps I am not so popular with some of the elected MPPs in the Legislative Assembly.

There was a time, and you have to change with the times, when the tax-free allowance -- I cannot speak for the municipalities -- was most appropriate for members of the Ontario Legislature. I know before I was elected there were not such things as constituency offices, members from out of town paid their own expenses while they were in Toronto, and travel was not reimbursed by the Legislative Assembly.

Over a period of time we have arrived at the point where most of our expenses -- there may still be some incidental ones but certainly not in excess of $14,000, which is what we get tax-free. There may still be some additional costs of meals if you are eating out when you are from out of town. It might cost you a little more than if you ate those meals at home. One could make that argument, I suppose. There may be some additional living expenses over and above what it would cost you to have one household instead of, as many of us have, two.

We might be able to make an argument that in our role as MPPs there is not a charity we do not support, although I suggest we are kind of pressured into that; we bring that on ourselves. But some may make an argument that some of those contributions are because you are an MPP, but certainly not $14,000 worth.

I am most distressed that we have continued this practice as we have improved the living expenses and other expenses MPPs have to bear. They have been more and more reimbursed: surely all our travel expenses -- I do not think anybody can make that argument any more -- and certainly expenses in using our automobiles, our constituency offices and our offices here at Queen's Park, and there has been more and more flexibility on how we could use more and more money in a substantial way. The $14,000 tax-free is not justifiable. It really is something I know the public is concerned about, and there is absolutely no defence for it.

I am distressed we have not had a government with the courage to address this. There may be some negatives attached to it. There may be the perception that somehow or other there is more money coming to us. I make it quite clear that there ought not to be as a result of any transition from doing away with the tax-free. I might be persuaded, if it is across the board and applies throughout the public sector, that perhaps the gross-up amount would not even bring home the same amount of take-home pay.

The public has spoken time and time again, and it affects our ability to speak with credibility and integrity on many issues. It does not affect our ability to do that; it affects how we are received. We all know politicians are not the most esteemed people in the neighbourhood these days. I think this is a contributing factor. We have an opportunity here. The Premier had an opportunity in opposition, and he spoke often; he spoke to me privately and he spoke in this Legislature. The House leader has spoken privately to me and publicly. I can recall two meetings I had with the Premier.

Normally I would not relay information from a private meeting but I am going to relay this, and I do not believe I am breaking any particular confidence in doing so. When the Premier took office he called the former leader of the Liberal Party and myself into his office on two occasions to discuss how he would like to proceed on some issues. The Constitution was one. I welcomed that discussion. We talked about a couple of others.

In both those meetings, not brought up by Mr Nixon, the former leader, and not brought up by me, the Premier brought it up and said: "I want you to know I am committed to doing away with the tax-free allowance. I want to make those changes that I've spoken about and I'm going to do it."

I am relaying that publicly now to tell members that there is not much point in going to private meetings with the Premier. I am wasting my time and I am mad about that, not just on this issue but on any issue to be called in to have this on the agenda -- it is the Premier's agenda -- and hear, "I'd like to discuss them, I'd like your thoughts about it," and then find out that is not at all what he is going to do.

There is nothing new today that we did not know last fall. We have got tough times, and it is more important than ever that we send out the proper signals to the public, which is paying the taxes, paying our salaries, and that we in fact put some of the myths to rest. But certainly the tax-free allowance is not a myth. It should not be tax-free. It is morally wrong. It is an incorrect amount of money, in a tax-free way. By putting off decisions and not addressing any of these as to what the appropriate level of pay is -- there are never good times and bad times.

I have been here 10 years and none of those 10 years has been a good time, apparently. Meanwhile the public is becoming more and more cynical about those of us in elected office.

I want to get that thought on the tax-free on the record. I want to say that I am prepared to sit down with the Premier, if he wishes to live up to the commitment he made to me privately and publicly to this Legislature and to the people of this province, and find a way that makes some sense.

In the second area, the Premier has been so vocal on not having us set our own salaries, whether it is for this term in particular, and to discuss mechanisms -- he has put that completely aside, and that also sends out a most improper signal to the public.

I have no difficulty with the 3% and 0%. I wish the restraint had been brought in much sooner by this government, starting at the top and sending out signals. I really find it strange that I have now seen comments, I think, by two different leaders of teachers' unions who have said, "If the government will pave the way, if the government will assure us that it is not our board taking zero or our teachers taking zero and others are getting more, or it isn't just teachers; it's all of those in the public sector," who they know are very fortunate during difficult economic times to have a job at all.

If there is a greatest fear among those particularly in the private sector, it is the fact that they have already lost their job and they are unsure about being able to find one, or indeed that their job is in jeopardy and they may not have it next year. This is a terrible feeling for people to go through, for families to go through, and by and large those in the public sector for the most part do not have those fears in their day-to-day lives.

I have been most critical of that. T