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April 26, 1979

31st Parliament, 3rd Session

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Hansard Transcripts

Hansard Transcripts

L031 - Thu 26 Apr 1979 / Jeu 26 avr 1979

STATEMENTS BY THE MINISTRY

ASSISTANCE TO SMALL BUSINESS

LOTTERY GRANT TO TORONTO HUMANE SOCIETY

DIOXIN IN FISH

ORAL QUESTIONS

NUCLEAR PLANT SAFETY

DIOXIN IN FISH

SHORTAGE OF SKILLED WORKERS

REED PAPER COMPANY

HYDRO URANIUM CONTRACTS

APPRENTICESHIP PROGRAMS

TUITION FEES

HOSPITAL BED ALLOCATIONS

DOMGLAS DISPUTE

THAMES RIVER FLOODING

FOOD PRICES

NUCLEAR PLANT SAFETY

VISITOR

REPORT

STANDING RESOURCES DEVELOPMENT COMMITTEE

INTRODUCTION OF BILLS

EDUCATION AMENDMENT ACT

ONTARIO HERITAGE AMENDMENT ACT

ANSWER TO QUESTION ON NOTICE PAPER

ORDERS OF THE DAY

PRIVATE MEMBERS’ PUBLIC BUSINESS

FOOD PRICES

TRANSPORTATION OF RETARDED ADULTS

BUSINESS OF THE HOUSE

FOOD PRICES

TRANSPORTATION OF RETARDED ADULTS

The House met at 2 p.m.

Prayers.

STATEMENTS BY THE MINISTRY

ASSISTANCE TO SMALL BUSINESS

Hon. Mr. Grossman: Mr. Speaker, last January my ministry initiated an extensive analysis and review of our programs of assistance to small business. Our goals were:

1. To find ways to make more money available through our small business support programs.

2. To develop more flexibility in our financial support to enable us to shape our programs to the particular needs of those small businesses which require assistance.

3. To expand our advisory support systems and capabilities.

4. To co-ordinate our own programs providing assistance to small business with federal government programs, private lending activity and our new employment development fund in a way which maximizes the access of small businesses and avoids overlap.

This review is now substantially, though not entirely, completed.

We wish, therefore, to outline the basic operation and direction of Ontario Development Corporation, Eastern Ontario Development Corporation and Northern Ontario Development Corporation which we see for the period ahead.

First, the existing direct lending programs of the Ontario Development Corporation will continue in those situations where private financing at reasonable cost is not available. These are: (

i) export support loans; (ii) Ontario business incentive program; (iii) tourist loans; (iv) venture capital loans; (

v) small business loans; (vi) industrial mortgage loans; (vii) pollution control loans.

Second, the preferential lending rates and terms applying to certain EODC and NODC programs will continue.

Third, the ODCs will focus on the needs of small business in Ontario. To this end, the Ontario development corporations will deal with all applications involving financial assistance of $250,000 or less; other requests for incentives will be handled by the Employment Development Fund.

Fourth, the Ontario development corporations will place increased emphasis on encouraging private-lender participation in small business support programs. To this end, the Ontario development corporations will be working more closely with the traditional lending institutions to expand our loan guarantee programs. The Treasurer (Mr. F. S. Miller) has agreed to an increase in the limit to total guarantees, and this will enable the Ontario development corporations to arrange much more private financing than otherwise would have been possible.

Fifth, we are developing an interest subsidy program for use in situations where both guarantees apply and where they do not in order to ensure access to privately arranged financing for small business at reasonable costs. The boards of directors of the development corporations -- which, I remind the House, comprise business people from northern Ontario, eastern Ontario and southern Ontario -- will be asked to play a more important role in considering requests for special support of all kinds -- incentives, guarantees and subsidies -- to ensure adequate private lender participation.

Finally, Ontario’s three development corporations will take on a larger role in providing financial advice to local entrepreneurs and assisting them in their search for alternative private financial resources. In this connection, the Ontario Development Corporation will be working closely with representatives of other government ministries to ensure that the recently announced incentives to small business equity investment through the introduction of small business development corporations will be developed to the maximum advantage of small business in Ontario.

I have already referred to the need for the Ontario development corporations to provide new and better advisory support to entrepreneurs. In addition, they will be expected over time to work more closely with private lending institutions to ensure their participation and to free up government resources for those situations where special government assistance is really required.

The ODCs should not just be another option to banks and private institutions. They should be an additional and different vehicle, available to do and accomplish and cause to happen things that won’t happen with traditional lending services.

Mr. J. H. Joyce, chairman of the board of the Ontario Development Corporation and chief executive officer of the development corporations, who has been involved in developing the innovative new face of the ODCs over the past five years, has reached retirement age and will step down as chief executive officer, effective May 1 of this year. Mr. Joyce has agreed to stay on as chairman to guide the ODC through this critical stage of its development. Mr. Blair Tully, formerly director of the economic policy branch with the Ministry of Treasury and Economics, will take on the duties of chief executive officer and executive director of the three development corporations.

Board meetings of the three development corporations will resume immediately. Those applications pending will be reviewed in the light of the new mandate and processed immediately. Meanwhile, I expect that action will be taken to develop with private lenders new programs which will include broader participation in meeting the financial needs of small businesses in Ontario.

To enable the ODCs to carry out this more diverse and flexible role, additional resources will be made available to meet new commitments. Together with the increase in the guarantee limit provided by the Treasurer, this will allow the development corporations to expand substantially the range and volume of financial support available to small business in Ontario.

LOTTERY GRANT TO TORONTO HUMANE SOCIETY

Hon. Mr. Baetz: Mr. Speaker, as the minister responsible --

Mr. Bradley: A new lottery.

Hon. Mr. Baetz: -- for Ontario government lotteries, I am pleased to inform this House that the government has approved a grant of $1 million from the provincial lottery fund to assist the Toronto Humane Society in relocating its present facilities.

Mr. Kerrio: You’re all going to the dogs.

Mr. Cassidy: I wouldn’t bet on the minister, if I was a gambling man.

Hon. Mr. Baetz: The new facilities are to be located at the corner of River Street and Queen Street East in Toronto. At present, they are located in a government-owned building on Wellesley Street West in midtown Toronto.

I would like to point out to the House that this one-time grant will be more than matched by the society’s fund-raising activities which have already received the generous support of the public. We also hope this will act as a further incentive to the public to continue its financial support of the society’s objectives.

As the members of this House know, the Wintario and Lottario lotteries, which operate under the Ontario Lottery Corporation Act, can only allocate funds for cultural and recreational uses. The grant, therefore, to the Toronto Humane Society will come entirely from the Provincial lottery which is not so restricted.

Mr. S. Smith: It’s for health and environmental research.

Hon. Mr. Baetz: In fact, to date $56 million has been allocated from Provincial lottery funds to eight Ontario ministries --

Mr. S. Smith: The Provincial is for health and environmental research.

Hon. Mr. Baetz: -- $25 million to Health; $7.5 million to Labour; $7.5 million to Environment; $4 million to Community and Social Services; $5 million to Agriculture and Food; $5 million to Natural Resources; $1 million to the Justice policy field; plus the $1 million we are now allocating for the society’s use.

This is yet one more example that the Provincial lottery is meeting our expectations.

Mr. Sargent: It’s a political slush fund, that’s all it is.

Mr. Kerrio: Strange priorities.

Hon. Mr. Baetz: The decision of the society to locate its new premises at Queen and River Streets in Toronto is a sound one based on several studies carried out by the society and several ministries. Several potential sites were considered, one of which, as many of the members know, was the Don Jail building and property. However, the Don Jail site was ruled out after study by four relevant ministries due to the possible future needs of a neighbouring hospital and the current needs of the Ministry of Correctional Services.

Both the government and the Toronto Humane Society are happy with the Queen and River Streets location.

DIOXIN IN FISH

Hon. Mr. Parrott: Mr. Speaker, I had intended to make a statement today on the fish testing program in Ontario to coincide with the opening of our fishing season, but I wanted to amend that statement to also include --

Mr. Kerrio: You can drink the water but daren’t eat the fish.

Hon. Mr. Parrott: -- a statement on dioxin and the testing that has taken place in New York. I do not have that information ready for today; I will have it for tomorrow and would like, therefore, to postpone the statement until tomorrow morning.

I thought I should give you that information, Mr. Speaker, because I had intimated that I would make the statement today.

ORAL QUESTIONS

NUCLEAR PLANT SAFETY

Mr. S. Smith: A question for the Minister of Energy, Mr. Speaker, with regard to nuclear safety: The question concerns the defective Babcock and Wilcox boilers supplied to Ontario Hydro nuclear generating stations; some 32 of these boilers were so badly damaged that they require major rebuilding at tremendous cost. I remind the minister we’re still waiting for details of this matter, which he promised the House a week ago.

Is the minister aware that in 1976 Atomic Energy of Canada Limited stopped using Babcock and Wilcox boilers for Candu reactors sold abroad because of concerns over the design safety of Babcock and Wilcox boilers?

Hon. Mr. Auld: No, I was not aware of that, Mr. Speaker, and I will inquire about it.

Perhaps I might take this opportunity to answer the question that I was not able to give full details about last week, the question the Leader of the Opposition asked me in connection with those boilers and the inspection procedures. It’s relatively short.

The damage to the internals of the Pickering generating station B boilers occurred after they were fully assembled, apparently during a beat treatment process of the completed boiler. Careful inspection during manufacture and assembly ensured no damage to the boilers had occurred up to that point.

[2:15]

Examination of the internals of a completed boiler is quite difficult because of the heavy steel shell and the internal steel shroud which surrounds the tube bundle. The damage to the internals is localized and limited to a certain group of tubes not easily inspected from the very limited access at the ends of the finished vessel.

Constrictions in the tubes were first detected by Ontario Hydro forces during tube-by-tube inspection of the first unit of the Pickering B station. This on-site inspection of the tubes was being undertaken to ensure tube wall integrity. Constriction of certain tubes was encountered. The cause and extent of the constrictions were not immediately evident, and considerable investigation ensued before the extent of the damage was defined and the post-weld heat treatment process identified as the probable cause of the difficulty.

A very preliminary estimate of the cost of rebuilding the damaged boilers was given by Ontario Hydro as $35 million. However, considerable work is required to firm up these costs. No information is yet available on possible costs to Ontario Hydro.

I also said I would attempt to get a drawing of the boiler to indicate the problem. I have one, and I will send it over to the Leader of the Opposition. I might say that the boiler is some 46 feet in height and has about 25 miles of tubing in it, or some 2,600 tubes.

Mr. S. Smith: Since the minister said he was not aware that Atomic Energy of Canada Limited stopped using the Babcock and Wilcox boiler for its Candu reactors sold abroad, might I ask him to check with Hydro to find out if Hydro was aware that AECL had stopped using Babcock and Wilcox boilers precisely because this heat treatment process was thought likely to produce the kinds of bending which eventually did ensue? Could he find out, if Hydro did not know about that, why it did not know and why it continued to use the Babcock and Wilcox boiler even to the point of accepting it for Darlington?

Hon. Mr. Auld: As I said, I will get that information. But, as the Leader of the Opposition is aware, before any unit can go into service, Hydro must get a licence and approval from the Atomic Energy Control Board. I would assume that, if there was some previous design fault encountered by Atomic Energy of Canada Limited, it would have been rectified, because otherwise, I assume, the Atomic Energy Control Board would not license the unit.

Mr. Nixon: Supplementary, Mr. Speaker: Is the minister aware that the president of the control board told the select committee yesterday that a special review had been undertaken as to the capability of Babcock and Wilcox in this connection and that the review has been completed? Does the minister have a copy of that review, and can we see it?

Hon. Mr. Auld: I would answer no to all three questions, Mr. Speaker. I have no doubt there has been a review, because I think I indicated to the House that Hydro asked that production cease on those boilers last December when it first became apparent that there were some problems.

Mr. M. Davidson: Supplementary, Mr. Speaker: Has the minister checked into the accusation by Babcock and Wilcox that the reason for the problem they have now run into was a change in the method of process, which change they were doing under instruction from either Ontario Hydro or Atomic Energy Canada Limited? Has he looked into that matter yet?

Hon. Mr. Auld: Mr. Speaker, I have not had any definite information on that as yet.

Mr. J. Reed: Supplementary, Mr. Speaker: Since the difficulties with these boilers was discovered by some test or inspection procedure which was done in the Pickering plant, could the minister tell us why this kind of search or procedure would not be undertaken as an inspection procedure at the point of fabrication before these boilers actually get in as finished products?

Hon. Mr. Auld: Without getting into the technical details which I am frank enough to say I am not qualified to discuss effectively --

Mr. Sargent: You’ve made that quite clear all along.

Hon. Mr. Auld: -- as I recall, the problem was found after delivery. It may well be something happened during delivery, I don’t know, but I really can’t answer that question. I will be delighted to try and get the answer to the member.

DIOXIN IN FISH

Mr. S. Smith: I’d like to direct a question to the Minister of the Environment, if I might have his attention for a moment, regarding the matter of dioxin. I’d like to ask him why he is not prepared to make a statement about dioxin in the House today. Why do we have to wait for tomorrow? In particular, would he agree if dioxin is present in the fish and possibly in the water, it’s very likely it comes originally from dioxin present on or in the land?

How does he expect his ministry at any point to be able to tell where the dioxin is coming from to get into the water when, for instance, the ministry does not even know about a site in Fort Erie into which it would appear the Hooker Chemical company has been dumping if we take the ministry’s list which they gave the resources development committee as an indication? The Hooker Chemical company, which manufacturers dioxin, at least in the States, has been dumping into that site. Is the minister aware his own inspectors have no record of any water quality testing done at the Fort Erie site?

Hon. Mr. Parrott: Mr. Speaker, that’s a very long question and it’s hard to get all of the impact of it, but let me give the House some information which I hope to amplify tomorrow.

I think one of the things I’ve learned about dioxin in the last two weeks is that it is invariably found with other substances, polychlorinated biphenyls particularly. If one finds high levels of those materials, one would expect therefore to find a possibility for dioxins. In their absence, one would not expect to find dioxins. That’s a pretty well known and accepted biological fact.

We have tested very carefully for the polychlorinated biphenyls and we have found minimal levels. Therefore, we have every reason to believe dioxin is not present.

It is a very complicated test. We’re prepared to do those tests in water. I think what also must be drawn to the attention of the leader of the Liberal Party is that because dioxin may be on the land it doesn’t easily follow it will be found in water because it’s a very insoluble material.

I believe the dioxin in the flesh of the fish has come from the ingestion of the solid particulate matter, not from the water itself. Therefore, I think if one puts all of that information together, one can readily believe we have every reason to know there is a very small amount of dioxin, if any, in the drinking water from Lake Ontario we consume.

I think those are logical progressions of the facts we know in Ontario. I don’t think we would be expected to know, and I don’t think the member is asking me to know all of the sites in New York state. Indeed, it wouldn’t be reasonable to request that we should know their sites. We’d have to expect they would supply that information. Certainly, we’ve got to test the water in the Niagara River and we have done that very consistently.

I think the word that describes it best is a herald substance. In other words, as I explained earlier, the dioxins are in a direct relationship with these other chemicals. Those herald chemicals show a very minimal level. I put that on the record today.

If I am not misunderstood, I have a couple of illustrations of the concentrations we’re talking about. I had them dig this up for me today because I think it is important to get some concept of the magnitude of the concentrations. I don’t offer this in a light way. A couple of the illustrations are light, but I think they do put into perspective the concentrations we are talking about. Let me give members some illustrations, if I can, to give some perspective to the concentrations.

In the fish we measured, there were four parts per trillion. Here’s what a part per trillion relates to, and I might be in some trouble with this first one. One part per trillion equals one shot of vermouth in a 28-million-ton martini.

Mr. Nixon: That’s your kind of martini.

Mr. Makarchuk: That’s pretty dry stuff.

Hon. Mr. Parrott: That’s a pretty strong martini. For those who would prefer I dealt with other interests, it’s like a one-gram needle in a million-ton haystack, or, if one put one drop of dioxin in a bucket of water, it would have a concentration of 2.5 million parts per trillion. What we found yesterday was four and six parts per trillion. I am saying that’s one drop in a bucket.

All I am trying to do is to give some perspective of the very minute quantities that today’s technology can measure. In the scheme of things, we shouldn’t lose sight of those extremely small concentrations. That doesn’t for a minute mean, and I am not trying for a minute to suggest, that I am not concerned about any concentrations of dioxin, but to give us a perspective we must know that those are the concentrations we are talking about. Therefore, when we are talking about four parts per trillion -- and the Americans have said that 10 parts per trillion is their action level -- we mustn’t lose sight of that perspective.

Mr. S. Smith: It’s the most exceptional answer we have had in this House in some time, Mr. Speaker. The real question, it would appear to me, is whether pregnant women and children ought to be eating the fish. If they are not, I don’t care how this relates to martinis.

Let me get to the precise matter. Need we in Ontario just sit back and wait to see whether our Great Lakes become poisoned or can we have a ministry that knows where chemicals have been dumped and will measure the water in the area of those dumps?

Given the fact that the minister gave to the resources development committee an alleged complete list of sites accepting liquid waste, which did not even have the Fort Erie site on the list; given that the Hooker Chemical company has been dumping into that site; and given that they make dioxin, why has the ministry not been measuring the water quality, the effluent and the surface water from that site and many other sites in Ontario? Why do we just have to sit back and wait to find the stuff in the fish?

Hon. Mr. Parrott: I am not going to repeat again the amount of testing we have done. I thought I had today made fairly clear that we have done a lot of testing. We are not sitting back. We have a very significant amount of knowledge about the dioxin in our Great Lakes and our streams. We haven’t tested it, but surely the Leader of the Opposition recognizes that the water from those dump sites in Fort Erie or anywhere else would find its way, if it’s a hazard, into our lakes and streams. I think I put rather clearly on the record today that all scientific evidence would clearly suggest there is not a danger of dioxin in our streams, and that’s where it becomes extremely important to us.

There is a highly unlikely possibility that people would ever consume sufficient quantities of fish that could be a serious hazard. I wish the member would try to hear this point. There is no danger in the quantities of fish that we are likely to consume here in Ontario. It is extremely unlikely. The New York authorities say they see no need to take action at the level of four and six parts. It is their standards that we endorse; we have a similar understanding of the levels of safety. They are saying there is no hazard and we are endorsing that

[2:30]

So surely the member can accept that we have an intimate knowledge. He is extrapolating a lot of facts and it makes a rather interesting case. In one sentence he talks about New York state and the next time talks about Fort Erie. The last I heard Fort Erie was not in New York state.

Mr. S. Smith: I never mentioned New York state.

Ms. Bryden: Mr. Speaker, I would like to ask the minister if he is planning to install his own testing facilities for fish so we can make sure our fish are completely safe. Also, has he yet been in touch with the governor of New York state to see that the dioxin that had got into Bloody Run Creek is being contained? There is still a danger, even if dioxin isn’t soluble, that it gets in the bottom of the streams and then gets into the food chain.

Hon. Mr. Parrott: Yes, we are making some tests on water and the level of dioxin. Earlier I described how we can extrapolate a good deal of information right now from the tests we have done on other materials and we will be doing that on dioxin.

We have taken the opportunity to send samples not only to the lab in Nebraska but to another lab as well, to confirm their analysis. I think it is important we have that done. We are prepared to send the flesh of the fish there for analysis.

We think the analysis in water is perhaps more important at this time, because it will affect every one of us every day. When we have that well in hand we will then do the tests on fish here in our labs; but the water testing is our first priority now.

Mr. Haggerty: Mr. Speaker, I think the question my leader was trying to convey to the minister is that there is a Hooker Chemical plant situated in the town of Fort Erie. There is a small stream running through the property that enters into Frenchman Greek which empties into the Niagara River. Has there been any chemical analysis done in that stream by the ministry?

Hon. Mr. Parrott: Yes.

Mr. Kerrio: Mr. Speaker, is the minister aware that upper New York state has probably one of the largest chemical dumps in America? Does he realize there is enough dioxin in one site to kill all of the people in North America? Because that condition exists in the neighbourhood of Bloody Run Greek, and with the great danger of that dioxin leaching into the waterways, wouldn’t we be well advised to have the very best testing equipment that exists? Should we not insist that those people in New York state cooperate so that we know what is happening?

Hon. Mr. Parrott: I don’t argue that case at all. Indeed, I think our lab has done a tremendous number of tests on the water in the Niagara River and Lake Ontario. We are getting co-operation from those authorities -- no problem there at all -- and I am very concerned that there is enough material in one site to destroy an unbelievable number of people. I think it is awfully important that be contained.

All of that I agree with; but surely the member would agree too that I have to expect, and he must expect, that will be done by the New York state authorities. He really can’t expect, on a reasonable basis, that I would go over there.

We have every reason to believe they are treating the problem as seriously as we do.

Mr. Warner: Swim your way over.

Hon. Mr. Parrott: I have said repeatedly that we have done a large number of tests, not specifically for dioxin as yet, although we will be. Because of what I call these herald substances, which give us a great deal of information about dioxin, we feel very confident of what our tests will show on dioxin.

I hope that technical point comes through in the dialogue here in the House because I think it is important. We do not yet have clear test results for dioxin per se, but we will have shortly. In the interval, I think the members must understand the significance of these other tests we have done very extensively which would lead us to believe there is no threat from dioxin at this time.

That will be confirmed when we carry out a larger number of tests specifically for dioxin.

SHORTAGE OF SKILLED WORKERS

Mr. Cassidy: Mr. Speaker, I have a question of the Minister of Industry and Tourism, arising out of the work of the selective placement service which, in fact, we had understood was a part of his small business development branch.

In view of the minister’s statement on Monday that the selective placement service has worked closely with both unions and companies in an attempt to provide options to reduced operations, or raiding other companies in looking for skilled manpower, did the ministry satisfy itself that General Motors had made an adequate effort to find the skilled workers it needed in Canada through contacting unions or private employment agencies before GM went off to Britain, and just what does “an adequate effort” mean, in the minister’s opinion?

Hon. Mr. Grossman: Mr. Speaker, may I clarify one point? We did not say it was part of the small business branch of the ministry; it is part of the selective placement service. It is a specialized service for all industry operating through our ministry.

The direct answer is yes, we did satisfy ourselves with regard to General Motors’ request. In fact, my information is that their request was for something more than the ultimate number with which we agreed to assist them, which was 95. After discussing the matter with them, the unions and Manpower, it was determined that the actual number which could not be recruited in Canada, so far as they all could determine, was 95.

Mr. Cassidy: Mr. Speaker, can the minister explain why he and his ministry believe that an adequate effort was made to look for the skilled workers here in Canada when, so far as we can ascertain, only one private employment agency was contacted, and union locals in the relevant skilled trades such as electricians, machinists and pipefitters were not contacted at all? Is this, in the minister’s opinion, an adequate effort? Or is the ministry prepared to insist that companies using this service will, in fact, have looked across Canada and in Ontario to find where the skilled workers may be available?

Hon. Mr. Grossman: I can only repeat what I said earlier, which is, that this program -- the placement of these 95 people -- was done only after consultation with union local -- I mentioned the number the other day -- 1973. And that union has two representatives on the committee which ultimately worked with GM to make this decision. In addition, the company’s intentions were specifically brought to the notice, I am informed, of the international union in Oshawa who were in concurrence with the company’s actions.

I would have thought, notwithstanding what the member has said -- he may have different information -- that clearly the unions were aware of it and explicitly approved of the fact that we had to go outside to fill those 95 jobs. If the union has informed the member that they are not satisfied, I would like that information, because we were informed exactly opposite.

Mr. Sweeney: Supplementary: I would ask the minister what long-term guarantees, if any, General Motors gave him, that they would proceed immediately to train their own people. I know there is a short-term one, but is there any long-term one?

Hon. Mr. Grossman: Again, General Motors has undertaken the program and it is in operation. They undertake to continue that program for as long as it is necessary in order to serve, obviously, their own purposes. After we get them to inaugurate the program, as a condition of providing these workers, all we can do is check back to monitor that they are fulfilling their commitment to us to proceed with the training. Obviously, the long-term apprenticeship programs still remain the responsibility of the firm, and the long-term programs relate to the ministries of Labour and Colleges and Universities.

Mr.

Cassidy: Supplementary: Since the United Auto Workers is not the only union which has jurisdiction over electricians, pipefitters, machinists and other trades that were being sought by General Motors, doesn’t the minister think GM should have been required to go to the relevant unions that have jurisdiction over most of these skilled tradesmen, particularly when there were more than 2,000 construction electricians in this province who are now out of work, many of whom have the skills that could be used at that plant, and when there are hundreds of unemployed pipe- fitters who have been seeking work in Alberta because they can’t get work in this province?

Surely GM should be required to look there and not just to the UAW?

Will the minister insist in future that before the services of his selective placement service are used every effort is made to look at all the possibilities for finding skilled workers in Ontario or across the country before going abroad?

Hon. Mr. Grossman: I have listened carefully and I don’t think the leader of the third party has yet indicated that he believes there were skilled workers in Canada who could have taken these 95 jobs. If he believes that to be the case, just so we’ll know what we’re talking about, rather than allegations I think the member ought to indicate that he is firmly aware that there are or are not skilled workers in Canada.

Mr. Swart: That’s your job.

Hon. Mr. Grossman: We’ve done our job, and we say --

Mr. Swart: No, you haven’t. You haven’t done your job.

Hon. Mr. Grossman: Let me finish. We said quite clearly, and we haven’t backed off from that, that all the efforts were made to locate other skilled workers in Canada. I just want to clarify whether the leader of the third party is saying there were skilled workers that GM and the other authorities involved were unable to locate. That is important information to us, because I am sure if he will pass that information to us, GM would be more than happy to consider making those jobs available.

I look forward to hearing from the member whether his allegation is that there are people who can take those 95 jobs. We checked in quite great detail with the Canada Employment and Immigration Commission, the unions and with all the government agencies involved. I think it is fairly reasonable for this province to rely upon the information given us by CEIC with regard to the number of skilled workers who are unemployed in Alberta or any other province.

I want to finish by saying, having done all that, we believe we carefully canvassed the field and that our analysis is complete. If the member has information that there are skilled workers who are currently unemployed and who could have filled those jobs, send that information to me and I will make sure those are forwarded through my selective placement service to General Motors. If they are qualified they will have the jobs.

Mr. Speaker: A new question.

Mr. Cassidy: Supplementary, Mr. Speaker --

Mr. Speaker: A new question.

Mr. Cassidy: The minister asked me a question.

Mr. Speaker: We’ve spent 32 minutes and we are not yet finished with the leaders’ questions. This isn’t the first day you have discussed it. I will entertain a new question.

Mr. Cassidy: Mr. Speaker, if the minister wants me to carry on his job I’ll be happy to take it, but he should resign first.

Mr. Speaker: Order. Do you have a new question?

Mr. Cassidy: I have a new question directed to that particular minister. However, I would say to him that the unions he is looking for --

Mr. Speaker: Order. Do you have a new question?

Mr. Cassidy: Okay, I’ll see you later, Mr. Speaker.

REED PAPER COMPANY

Mr. Cassidy: A question to the Minister of Industry and Tourism: In view of the fact that the Reed paper company has now been turned down on its application to the Employment Development Fund for a $26-million grant for the Dryden paper mill, can the minister explain the reasons for that decision, which has now been communicated to Reed?

Hon. Mr. Grossman: We received their application and it was processed in the light of the statements made and the programs set out. In simple terms, they didn’t meet the criteria as laid out in the program several months ago.

I would be pleased to indicate the criteria against which theft application, and all applications out of the pulp and paper industry, are measured. Economic viability, unquestionably. We want to make sure, of course, that the proposal improves the overall efficiency of the plant and the mill in order that it has a reasonable chance of competing over the long run.

[2:45]

Second, the commercial rate of return is obviously an important factor. We want to make sure that the ultimate operation which continues is one that is not overly susceptible to the cyclical changes in that industry; we do not want to cause a major investment to occur which cannot survive a difficult period of years -- and there will be such times in that industry.

Thirdly, and most important, we want to make sure the investment is such that it creates long-term employment in the area. Any investment which might be approved has to be an investment that will assure us that the plant is going to be in business and economically competitive for 20 years or so.

Fourth, environmental improvements: Obviously much has been said about this; we want to make sure that the environmental improvements are of such magnitude that they meet all the requirements of the Ministry of the Environment.

Fifth is optimum forest utilization.

Sixth is integration with federal programs so that, for example, we accomplish some goals which the federal program -- whenever it really gets under way -- will not meet.

Finally, we want to obtain maximum leverage on public funds. I ought to take this opportunity to clarify the one-for-three ratio which was set out in January when the document was released and the Treasurer announced the program. One for three is the minimum ratio. We hope to achieve much better leverage than that. We would hope that in many circumstances we could lever as high as one for seven: one public dollar for seven or eight private dollars.

In a general way, I would say that the entire atmosphere within which these proposals are assessed is one in which we want to make sure that we maximize the benefits out of our own natural resource base. Taking that as the overall criterion, and following down the seven things we have said, we obviously concluded that, overall, the proposal submitted by Reed was not one which satisfied enough of those criteria in enough ways.

I do want to emphasize, of course, that Reed is more than welcome to come back again with a new and different proposal.

Mr. Cassidy: In view of all that the minister has said and what that indicates about the major industry in the town of Dryden -- a town which has 1,200 employees in the paper mill and which is several hundreds of miles from any other major centre of employment -- can the minister say what plans the government has to maintain the economic viability of the town and its surrounding area?

Hon. Mr. Grossman: I may say that we believe there is a scheme of modernization which can make that plant economically feasible in the long term.

The proposal submitted to us, in our opinion, was not one which would have done that. But we do believe that the mill, with appropriate modernization, is one that can and will survive in the long run. That is why we have made it quite clear to Reed that we would hope they would come back and make a proposal that would accomplish our goals; they can be accomplished.

Mr. Gaunt: Supplementary, Mr. Speaker: Since the Minister of the Environment indicated this program was one of the main reasons why he came in with a 1982 deadline, and since the company now has been turned down under the terms of this program, is the minister going to recommend to his colleague that the deadline now be extended to 1985?

Hon. Mr. Grossman: Mr. Speaker, the question of the deadline is one which the Minister of the Environment has been quite explicit on and one which he will take up with cabinet.

May I say we are convinced there is a scheme of modernization which can work in the plant? Our outlook in terms of this was to deal with the questions in the context of whether there is a modernization scheme which can work and make that plant viable, be it in 1980, 1981, 1982, 1983, 1984 or 1985. We still believe there is a scheme which can make that plant viable and, quite possibly, by 1982. This just does not happen to be the proposal.

Mr. Mackenzie: Supplementary, Mr. Speaker: Inasmuch as all three parties made a commitment to maintain Dryden as a viable unit, considering the investment we have there, and in view of the minister’s statement that they’re not going to make the grant requested by Reed paper, is the minister telling this House this government is willing or ready, if necessary, to acquire that plant and bring out the modernization that he’s talking about to maintain that community?

Hon. Mr. Grossman: No, of course not.

Mr. Warner: What is the government going to do?

Hon. Mr. Grossman: But we do believe private operators of that mill can develop a program, with the assistance of this government, to make that plant commercially viable. That’s as simply as we can put it.

Ultimately, we believe a scheme can be developed. We’re very familiar with the problems in that location and the commercial viability.

Mr. Mackenzie: How does the government get Reed out?

Hon. Mr. Grossman: I want to emphasize that the member who asked that question and his party particularly would be most critical of this government if we put ourselves in a position to accept a proposal coming along from Reed or anyone simply because that was the first proposal through the door. I think the members would expect us to do exactly what we’re trying to do -- that is to maximize the operation and maximize the return on our resources.

Mr. Warner: The government normally rewards the polluters.

Hon. Mr. Grossman: We are going to carefully analyse those proposals --

Mr. Warner: We remember Dow Chemical.

Hon. Mr. Grossman: -- and rather than buckle down and kneel down to the company that came through the door, as the member would --

Mr. Warner: If the minister bowed down he’d disappear.

Hon. Mr. Grossman: -- be willing to charge, we have instead said to them, “We don’t think this is one which maximizes that facility as it might be. Please come back and see us.” And I hope they will.

HYDRO URANIUM CONTRACTS

Hon. Mr. Auld: Mr. Speaker, last week the Leader of the Opposition asked me about Ontario Hydro’s agreement with Shell for uranium exploration. I think I gave the Leader of the Opposition the number of agreements Ontario Hydro has for uranium exploration in various parts of Canada, but I did not have with me the terms of Hydro’s agreement.

The terms of Ontario Hydro’s agreement with Shell do not prevent Ontario Hydro from entering into agreements with others, either in Ontario or in other parts of Canada.

Since early 1974, Ontario Hydro has considered and turned down more than 35 proposals for the support of uranium exploration in Ontario. I’m informed by Hydro these have all been turned down, following review by Hydro’s consultants, on technical and/or economic grounds. In no case, did Ontario Hydro’s agreement with Shell influence the decision.

Ontario Hydro does not carry out uranium exploration itself. In some cases where proposals were of no interest to Ontario Hydro it was suggested they could be taken to Shell as being better able to assess -- and potentially, I suppose, act on -- the proposed programs. This did not represent a deferment to Shell but was intended to assist the vendors of the proposals.

As I indicated last week it is the Ministry of Natural Resources which licenses prospectors. They can prospect wherever they choose and for whomever they choose.

Mr. S. Smith: By way of supplementary: Is the minister saying there are geologists who tried to enter into agreements with Hydro and that Hydro sent them to Shell, not because Shell had control of the situation but in order that Shell would give them advice or something of this kind? Is it reasonable that Hydro should be sending Canadian geologists to a multinational company for this kind of advice? Could we see that contract between Shell and Hydro? Would the minister please table that?

Hon. Mr. Auld: I would be delighted to get that from Hydro and do so.

What I said was that Hydro might have suggested, when prospectors had come to them and said they would like to do some exploration for Hydro, that their proposal was not of interest to Hydro -- for any one of a number of reasons. They have suggested to those prospectors on occasion, I am informed, that perhaps their proposal might be of interest to Shell for its own purposes.

APPRENTICESHIP PROGRAMS

Hon. Miss Stephenson: Mr. Speaker, there has been some confusion about figures regarding apprenticeship statistics which were made available to the leader of the third party last week.

Mr. Van Horne: Scrap the whole program and start from scratch.

Hon. Miss Stephenson: I promised I would check these and correct them. Mr. Speaker, I should like to table the correct statistics today.

Mr. Mancini: Apologize.

Hon. Miss Stephenson: Indeed, the honourable leader of the third party was provided with inaccurate information. It was the fault of the staff of the ministry, and for that, I apologize.

Mr. Cassidy: I thank the minister for the figures on apprentices.

Will the minister confirm, however, that although she has now provided us with new figures that we were not able to get accurately from her ministry before, they still show that between March 1978 and March 1979 there has been in fact a reduction in the number of apprentices in the area both of industrial electricians and also of construction electricians; there has also been a reduction in the number of apprentices in the area of millwrights, both in the industrial and construction areas; there has been a reduction in the number of apprentices in the areas of both construction pipefitters and industrial pipefitters?

Will she say when this government will start to ensure we increase the supply of skilled labour rather than reduce it?

Hon. Miss Stephenson: There are selected apprenticeships, which were those mentioned by the honourable member in his original question, which were listed on this tabulation. There has not been a decrease in the number of industrial electricians. There most certainly has been a decrease in the number of construction electricians and apprentices in other construction trades because of the fact we are reasonably well supplied at the present time with skilled tradesmen in those construction areas.

We do have needs, however, in the industrial area and we are attempting, as I am sure all the honourable members know, to increase the numbers in that area. This is one of the focuses of our increased activity in employer-sponsored training, and certainly one of the focuses in the increase in apprenticeship training.

There has been, in fact, an overall increase in the numbers of apprentices over the last several years, but in certain specific areas, there have been very small reductions in numbers.

TUITION FEES

Hon. Miss Stephenson: There was a matter raised by the member for Windsor-Riverside (Mr. Cooke) regarding the fee increase for the nursing program at Mohawk College. As I said when the question was asked in the House, the directive of January 19, which outlined a change in fee policy, was issued in error and that directive was rescinded and was replaced by one that stated an increase of $10 per academic term would be the right one.

It was also specified in that directive that the colleges were to apply the new tuition fee in accordance with 1978-79 college fee practice. When I investigated the case that was brought to my attention by the honourable member, I found Mohawk College had indeed increased its fees for the nursing program from $425 in 1978-79 to $599 for the second year of the program in 1979-80.

I have communicated my concern about this matter to the chairman of the board of governors of Mohawk College, and have written to the chairman as well, directing the college to conform with the policy on fee increases. As a result, the fees at Mohawk College for the nursing program will be $445 for the 1979-80 academic year. I would like to thank the honourable member for Windsor-Riverside for raising the matter.

HOSPITAL BED ALLOCATIONS

Mr. Nixon: Mr. Speaker, I have a question for the Provincial Secretary for Social Development. I assume she chaired the cabinet committee which approved the policy for the cutback of active-treatment beds in the hospital system of the province. Is she aware that the result of that policy, by action of the boards of the Brantford General Hospital and St. Joseph’s Hospital, is the closure of a total of 66 beds and the announcement of the layoff of 51 staff, and that the former chairman of the health council is saying the health care system in Brant county is “disintegrating before our very eyes” and he is responding to what he describes as “a potential disaster.”

If she is aware of that, would she agree with the Treasurer (Mr. F. S. Miller) and the Minister of Consumer and Commercial Relations (Mr. Drea), who both assured the people of the area, and very properly so, that if the quality of medical care was going to be substantially reduced, the policy would be reviewed?

[3:00]

Hon. Mrs. Birch: I think that question was directed to the Minister of Health (Mr. Timbrell) from a member of the third party this week, at which time the minister said he would be in touch with the local council of health and would be reporting back to the House.

I expect the minister will be in the House later this afternoon, and perhaps that question could be directed to him at that time.

Mr. Nixon: Supplementary, Mr. Speaker.

Mr. Speaker: It was taken as notice when it was asked previously and it has been taken as notice now. Why don’t we wait until the appropriate minister answers it?

Mr. Nixon: I was trying to bring to your attention, sir, that the minister was coming in. If I may, I would also like to bring to your attention that the question asked by the member for Brantford (Mr. Makarchuk) -- and a very good question it was -- had to do with the $400,000 the hospital boards say the ministry owes them.

Since that time -- and I say this for the benefit of the minister who is now here -- the decision has been taken to close the beds and lay off over 50 staff. The former chairman of the health council, a person who was appointed, though not as chairman, to the health council by the ministry, says that the health care system is disintegrating in the county. He’s Jim Longley.

The minister is frowning. I phoned notice of this to his ministry. This is a matter which is of grave concern, not only in the area, but here, because the minister has assured people locally that there would be no deterioration of the service. What is the minister going to do about it?

Mr. Van Horne: Plan ahead.

Hon. Mr. Timbrell: Thank you, I will. I apologize for being late. I was in the great city of Oshawa.

Mr. Breaugh: We love to have you as long as it is only temporary.

Hon. Mr. Timbrell: On the way in, I was handed some information about this. As background, let me say, when I met with the delegation from the local health council and the hospitals three or four weeks ago, I indicated that up to $384,000 or $390,000 would be reinstated when a rationalization plan was agreed upon by the hospitals.

I haven’t seen it yet, but apparently there arrived in my office today a telegram from the health council, asking if we would agree to fund valid deficits between April 1, the beginning of the fiscal year, and the point at which a rationalization agreement would be concluded.

I think we are dealing with reasonable people and, depending upon what they define as valid deficits, I am quite prepared to do that, again to the limit of the $390,000. They apparently are asking for a further meeting and that will be set up as soon as possible.

Mr. Nixon: I am sorry the minister is not up to date. Is the minister not aware that the rationalization which had been proposed by a committee of the health council and which evidently the minister thought was going to he accepted, has been turned down by the hospital boards, and that action on another type of rationalization, that is, laying off over 50 employees and closing the active-treatment beds, has been entered into as the only alternative under the minister’s policy?

Is the minister not aware that in this area at least his policy is a dangerous failure and must be reviewed?

Mr. Kerrio: The minister of lotteries gives the money away.

Hon. Mr. Timbrell: The point of the offer in my letter to them following the last meeting was to provide a substantial financial incentive to complete the process of a rationalization agreement. At the time, I was not making any assumption that what was on the table then would in fact be the agreement. Apparently, all the hospitals agreed to it, save one.

What I want to assure myself of is that we can get everybody back to the table quickly to get on with this process. I certainly don’t want to see services cut further than would be prudent.

Mr. Nixon: Should they withdraw their dismissal orders while you get them back?

Hon. Mr. Timbrell: The telegram, which is apparently in my office, asks if we will approve -- I think the wording, according to the note which was handed to me, is --

Mr. Nixon: Interim financing.

Hon. Mr. Timbrell: -- valid deficits, which would be incurred between the beginning of this fiscal year and the point when rationalization would be concluded. Within reason, I’m quite prepared to go along with that. Obviously, I can’t give a blank cheque but I’m certainly prepared to be reasonable on that. I don’t think you want me to give a blank cheque anyway.

Mr. Nixon: Within reason you’re quite prepared to go along with that.

Mr. Speaker: Order.

Hon. Mr. Timbrell: Mr. Speaker, I think we’ve demonstrated in countless situations that we’re quite prepared to work with the local people and within the resources available to do everything possible. The same would be true here.

Mr. Makarchuk: Mr. Speaker, is the minister aware of the fact that just a couple of weekends ago there was no bed available for a serious suicide case? There are two bodies from that hospital upon which inquests will be called shortly. In the sense of just something known as human decency, will the minister resolve that problem before we have more bodies in that area?

Hon. Mr. Timbrell: That’s a pretty serious allegation. I would have thought by now the member would have contacted me directly and given me names or something rather than this kind of tactic on his part.

Mr. Makarchuk: There’s a letter on the way.

Hon. Mr. Timbrell: It doesn’t speak well for you.

Mr. Speaker: Order.

Hon. Mr. Timbrell: Again, the clear purpose of the letter that I gave to that health council following the meeting of a month ago was to provide a substantial financial incentive to get on with the job of rationalization. If there’s some additional variation I need to give to ensure that happens and services are maintained at reasonable levels, I’ll do that.

DOMGLAS DISPUTE

Mr. Mackenzie: A question for the Minister of Health: Is the minister aware that Domglas in Hamilton, currently in the fourth week of a labour dispute, has cut off the coverage for sick benefits, extended medical, life insurance and prescription drugs for its employees? Could the minister tell the House what he is prepared to do to ensure employees such as Art Lee, who has been on sick leave since January 4, can get the $50 worth of pills per month that he needs to function?

What action will the minister take to assure that Domglas’s dog-in-the-manger attitude, which puts even Inco to shame, is not allowed to deny workers or their union the right to pick up the coverage for such essential services through the refusal of the company to allow the insurance carrier to extend the coverage?

Hon. Mr. Timbrell: I don’t believe my ministry would have any authority in that area whatsoever as it pertains to benefits under what I take to be an expired collective agreement, but I will look into the matter. I believe it would more likely come under the jurisdiction of my colleague, the Minister of Labour (Mr. Elgie). If that’s the case, I will see it is referred to him and his ministry as soon as possible.

THAMES RIVER FLOODING

Mr. Watson: I have a question for the Minister of Natural Resources. In view of the fact it’s some six weeks since we had the serious flooding in Dover township, and in view of the fact the minister appointed a committee to investigate it and the committee’s initial timetable called for a report sometime before May 1, can he indicate to this House the committee’s progress or whether that report is forthcoming?

Hon. Mr. Auld: I understand the report is being typed; it has been written. I’m expecting to receive it any day now. When I receive it, I will take whatever action is indicated, if action is indicated, and the report will be made public.

FOOD PRICES

Hon. Mr. Drea: On Tuesday last, the leader of the third party asked me, through the Premier, why on February 28, 1979, a can of Carnation evaporated milk containing 15 ounces of milk cost 46 cents and a week later, ostensibly because of the conversion to metric, a can that contained 10 per cent less milk cost 45 cents. The truth of the matter is Carnation did not raise their prices. When they converted to metric they dropped their price by the exact same amount, 9.4 per cent. As late as this week that product can be bought in Sudbury for 42 cents, not 46 cents. The reason it was bought at that price on that day was a clerical error in the store. We have checked it out.

I am going to give back these cans to the honourable member and I hope he gives the one back which has a price tag on it. The store is perfectly willing to give back the three cents. It was a clerical error. May I suggest that the honourable leader of the third party please apologize to the Carnation Company Limited which did not engage in the alleged rip-off. It has lowered its price; the price is 42 cents today as it was.

Just to avoid another question, Mr. Speaker, at the end of March the federal government increased the support price on powdered milk by three cents. That means that somewhere along the line, as soon as present stock is sold, right across the province, here in Toronto and in Sudbury, these cans are going up to 45 cents. I would just clear that up before there’s another question.

I do believe, however, before I let the leader of the third party have the cans, that he should make an apology to the Carnation milk people.

Mr. Martel: Is it the responsibility of clerks in stores to set prices? Is that what the minister is telling us?

Hon. Mr. Drea: Mr. Speaker, in this case there is a price chart in the store. The clerk made a human error. The clerk can hardly be blamed if he put 45 on instead of 42. The store will give it back.

NUCLEAR PLANT SAFETY

Mr. Sargent: Mr. Speaker, a question for the Minister of Energy --

Mr. Speaker: We have about 30 seconds left in question period, if you will put your question.

Mr. Sargent: Is it correct that the stack monitoring system at the Bruce nuclear generating station is not operational and never has been? Is it correct that this monitoring system is supposed to warn the plant operators of excessive releases of radioactive gases? Is it correct that radioactivity could be released through the stack without the operators knowing it; that the operators are unable to take immediate defensive action because the monitoring system doesn’t work and never has?

Hon. Mr. Auld: Mr. Speaker, I don’t know but I will certainly inquire.

Mr. Speaker: The time for oral questions has expired.

Mr. Sargent: Mr. Speaker, I had not finished my question. I am entitled to a supplementary.

Mr. Speaker: Yes, you have finished your question. The time for oral questions has expired.

Mr. Sargent: On a point of privilege, Mr. Speaker, the Minister of Energy and the Premier (Mr. Davis) last week assured me that the extensive special incident reports of Hydro were public information. I suggest that the minister has been misleading the House by saying that I could have those reports. The Premier told me that I could take them home for the weekend. Either he is misleading the House or he doesn’t know what the hell he’s talking about.

Mr. Speaker: The hon. member knows that he shouldn’t make those kinds of accusations. They are unparliamentary.

Mr. Sargent: What am I supposed to do then? He tells me one thing and I find it’s not true.

Mr. Speaker: Say it some other way. Withdraw that.

[3:15]

Mr. Sargent: I withdraw the misleading part. Mr. Speaker, we are dealing with a very important issue. There was a quotation this week by a prominent Hydro authority, who said: “When you are up to your ass in alligators you sometimes forget that your main objective is to drain the swamp.”

Mr. Ashe: Which one are you, the alligator or the ass?

Mr. Sargent: That is the situation today regarding nuclear power in this country, Mr. Speaker, and you sit there and block me from asking him a question affecting the lives of millions of people.

Mr. Speaker: The honourable member was obviously away in his riding last week on very important business when the Minister of Energy answered the member’s former point of privilege. I don’t know whether the minister wants to repeat it again, but it was actually done in this House. And don’t blame the chair for trying to block you from putting a legitimate point of privilege; you had just as much opportunity as anyone else.

Does the Minister of Energy wish to elaborate on the full statement he made earlier last week?

Mr. Sargent: Let him tell me if these reports are available to the public.

Hon. Mr. Auld: Mr. Speaker, I think I covered the matter thoroughly last week, although perhaps I could look into the other part of his question as Minister of Natural Resources.

VISITOR

Mr. Speaker: I would like to draw to the attention of all honourable members that we have a former colleague sitting under the Speaker’s gallery; the former member for Algoma, Mr. Bernt Gilbertson, with his good wife, Mrs. Gilbertson.

REPORT

STANDING RESOURCES DEVELOPMENT COMMITTEE

Mr. Villeneuve from the standing resources development committee reported the following resolution:

That supply in the following amounts and to defray the expenses of the Ministry of Transportation and Communications be granted Her Majesty for the fiscal year ending March 31, 1980:

Ministry administration program, $31,-286,000; planning, research and development program, $19,714,000; safety and regulation program, $42,697,000; provincial roads program, $429,190,000; provincial transit program, $63,535,000; air program, $4,289,000; municipal roads program, $386,423,000; municipal transit program $154,858,000; and communications program, $2,076,000.

INTRODUCTION OF BILLS

EDUCATION AMENDMENT ACT

Mr. Stong moved first reading of Bill 70,

An Act to amend the Education Act, 1974.

Motion agreed to.

Mr. Stong: Mr. Speaker, the act defines compulsory school age and guarantees every child of compulsory school age a right to an education.

ONTARIO HERITAGE AMENDMENT ACT

Hon. Mr. Baetz moved first reading of Bill 71,

An Act to amend the Ontario Heritage Act, 1974.

Motion agreed to.

ANSWER TO QUESTION ON NOTICE PAPER

Hon. Mr. Welch: Mr. Speaker, before the orders of the day, I wish to table the interim answer to question 138 standing on the Notice Paper.

ORDERS OF THE DAY

PRIVATE MEMBERS’ PUBLIC BUSINESS

FOOD PRICES

Mr. M. N. Davison moved resolution 9:

That, in the opinion of this House, the government should introduce legislation to create an Ontario Food Prices Review Board to protect consumers from unjustified, unfair or excessive increases in the price of fond. The board should consist of five members. The staff of the board should be seconded from ministries and agencies of the Ontario government and the board should be able to engage on a temporary basis the services of persons having technical or specialized knowledge to advise and assist it.

The board should have the power: (

a) to investigate, on its own motion or on complaint, costs, prices, profits and practices of any person or corporation engaged in the storage, processing, transportation, refrigeration, packaging, wholesaling and retailing of any food where a price increase has occurred, or where the board is of the opinion that a price increase is about to occur; (

b) to inspect and examine any or all books, records and materials in the possession or control of any person engaged in the activities set forth in (

a) and to require any other information from such a person that the board considers necessary; (

c) to delay any increases in the prices of foods where an investigation by the board is in progress.

Where, after making an investigation, the board is of the opinion that a price increase is unjustified or unfair or excessive, the board should have the power to order a rollback, or where the price increase has not yet taken place, to order that the price increase not take place. Persons affected by an order of the board should have a right of appeal to the Commercial Registration Appeal Tribunal. The board should report on its activities at least quarterly and that report should be tabled in the Legislative Assembly.

Mr. M. N. Davison: Mr. Speaker, I believe we are currently caught in a price-based inflationary spiral in this province and in this country, and that food prices are leading the way at an annual rate of 21.7 per cent. This government has a responsibility and a duty to its citizens to do something about that fact and to take action to try to get this situation under control. I have put forward this resolution as a starting point for the government.

Last month the AIB 12-city index which established the 21.7 per cent level contained the following component index, which I think should be on the record of this assembly: Beef was up four per cent over the four-week period, for a yearly increase of 65.9 per cent. Pork was up 1.2 per cent and that led to 11.7 per cent over the year. Other meats rose 5.1 per cent over the month, raising their level to 49.3 per cent higher than the year before. Poultry was up 2.7 per cent, which led to a yearly increase of 33.4 per cent.

Eggs were up 0.8 per cent in the four-week period, and 9.7 per cent for the year. Cereal and bakery products were up 1.1 per cent in the four weeks, a 17 per cent increase over the year. Fresh vegetables were one of the few that went down, they went down 3.9 per cent in that four-week period, but over the year had risen 21.6 per cent. Fresh fruit was up 1.3 per cent over the month, and 12.9 per cent over the year. Beverages, while going up 2.7 per cent over the four-week period, actually were the only item on the component index to have fallen during the year; they fell 0.9 per cent from the March before.

The last AIB report showed that the weekly cost of a nutritious diet for a family of four in the city of Toronto had gone from $51.43 in March 1978, to $59.54 in March 1979. This is a particularly outrageous finding, and I will tell you why, Mr. Speaker. If we view it against a recent survey that was done in the city of Toronto by Martin Goldfarb, that survey showed that in the year 70 per cent of Torontonians had adjusted their eating habits simply to try to deal with the ever-rising prices of food.

So while we find most of the people in Toronto, and I presume in the province of Ontario, have adjusted their diets to try to deal with increases in food prices, the prices escalate at remarkable rates.

While food prices rose 21.7 per cent in the last year across the country, third-quarter figures show that food store profits rose 37.9 per cent. If we can take one company as an example, I would like to take the Weston food conglomerate. In 1977, Weston recorded profits of $27.4 million. In 1978, Weston recorded profits of $50.6 million. That means that in one year alone Weston’s profit level rose 84 per cent.

So we have this situation: Food prices increased 21.7 per cent, food store profits increased 37.9 per cent, Weston profits increased 84 per cent, and in the same period workers’ wages went up 6.4 per cent. That is a crisis.

Earlier this month I sent a questionnaire to my constituents in Hamilton Centre, and they invariably have a good sense of what is happening in their city and in this province. I asked them who and what groups they thought were responsible for the huge increases we have seen in the price of food in this province and in this country. I took the three sectors, generally speaking: the farm level, the retail level and all of those in between.

The results have just started to come in, but I would be quite happy to share with the House the initial results. At the farm level, only 13 of my constituents thought that the farmers were responsible; at the retail level, 89 of my constituents put the blame on supermarkets; and 122 of my constituents put the finger on the middleman level in between. I think my constituents are quite astute in their assessment of the situation. That is why this resolution addresses itself to the post-farm-gate situation.

Evidence of an unacceptable degree of concentration in the food industry has been coming out over the past number of years, part of it in the current inquiry into various practices. I don’t intend to spend any time dealing with that question of concentration, with one exception a bit later on. It is well known that most of our chains in the country are both vertically and horizontally integrated to the detriment at least of consumers, if no one else, though I suspect many more.

Weston is a premier example. I will talk about Weston a little later on. If I can talk about another company, I would like to cite the example of Canada Safeway. Canada Safeway Limited is a wholly-owned subsidiary of an American company by the name of Safeway Stores Incorporated, which is the second largest retailer in the United States of America.

Canada Safeway owns grocery stores, fluid milk plants, ice cream factories, wholesale companies, coffee and tea plants, cheese-cutting plants, frozen food plants and beverage plants. The American parent company is also into, among other things, household chemicals and soap companies, and controls the largest private trucking fleet in the country. In 1977, Canada Safeway, that vertically integrated corporation, showed a return on investment of 27 per cent.

Many of our other corporations are horizontally integrated as well as those at the retail and other levels. One could consider the example of Del Monte, which has been raised in earlier debates in this Legislature. When Del Monte was competing with Canadian Canners, and having a decidedly hard time of it, it decided it would be a lot easier to buy them out rather than continue the competition. Del Monte proceeded to do so.

That has led to the rather interesting situation where we have well over 100 canneries in this country, but Del Monte controls over 20 per cent of the market. That means one company is in a position to set prices paid to farmers and to set the price that the consumer has to pay for all of those goods.

The large chains have gobbled up the small independent companies throughout Ontario and throughout the country at an alarming rate, whether it is the Weston takeover of Zehr’s in southwestern Ontario or the Dominion takeover of Hiway Market in the province.

The Minister of Consumer and Commercial Relations (Mr. Drea) and I had an exchange earlier this week -- on Monday, I believe -- about the effect of concentration, specifically dealing with bread. While I didn’t have time in question period to share with him the brand names, I would like to take the time now so that he and other members can understand exactly what the problem was that I tried to point out in that rather constrained period of time.

The federal lifting of the subsidy was supposed to result in an increase of 3.2 cents, I believe, in the price of a loaf of bread, according to most predictions before the fact. The actual increase was frequently seven to 10 cents on a loaf of bread. If one looks at the Weston company, Zehr’s, which is dealing in the southwestern Ontario area, one will find they had eight brands of bread on their shelves. They had Country Oven, Zehr’s, Dietrich, Weston’s, Wittich’s 1812, Stone Ground and Christie’s.

That looks like a great degree of competition and implies that the consumer has a pretty fair chance of not being taken by the amount of concentration in the industry; but in fact only Christie’s bread was not baked by a company owned by the Weston chain. Seven out of the eight were Weston breads.

[3:30]

Not only did Weston retail those breads, but if you take a look at the suppliers of the ingredients, Mr. Speaker, you can see it’s a fairly cosy arrangement. The milk for those breads came from either Royal Dairy or Donlands Dairy. The flour comes from Soo Line Mills

(1969) Limited or McCarthy Milling Company Limited; the sugar from Westcane Sugar Limited. The distributors are National Grocers Company Limited and York Trading. Every one of those companies is a Weston company. What we have is Weston supplying its own ingredients for its own bread, which it wholesales and retails. It’s all one big happy family.

In the process, they take off the cream. They take off a profit at every single stage, with no necessity for competition along the line because of the involvement of an independent company. All the while, that creates the appearance to the consumer of real and fair competition -- private enterprise -- in that particular sector. In fact that’s a myth that doesn’t exist; the appearance of competition is provided without actual competition.

The effects of this kind of concentration and this kind of integration on consumers is reasonably well documented. The minister and I had an exchange about certain federal government documents very briefly on Monday.

One of the component studies and reports for the AIB’s work was the Mallen report. I’m sure the minister is familiar with the Mallen report. It showed that in 1976 consumers were being overcharged by at least four per cent on their food bills because of the high degree of concentration and integration in the food industry. What does four per cent mean in Ontario?

Four per cent on the food bill in Ontario means something in excess of a quarter of a billion dollars over a year. When we look at the effects on the consumer of that kind of concentration, you’re talking about consumers being taken to the tune of something in excess of a quarter of a billion dollars a year in the province.

Numerous studies have been done in the United States, some of them by rather staid organizations. The FTC concluded, after studying 13 food lines in the United States, that American consumers were being overcharged by $2.1 billion because of monopoly power in the food industry. A further FTC study estimated that if highly concentrated industries were decentralized food prices to the consumer in the United States would fall by 25 per cent. The FTC is not the most radical economic organization in the world; the crisis is quite clear.

Over the past decade and a half the Ontario Food Council has been charged with the responsibility for keeping an eye on the food industry. Peter Hannam, the president of the Ontario Federation of Agriculture, characterized the council’s work as both irrelevant and ineffective. I think he’s accurate in his assessment. The government has virtually ignored the problem over the past few years of ever-rising food prices.

It’s only now, when public pressure has been built by organizations such as Women Against Rising Prices and many others, that the government has realized it can no longer ignore it and has to make at least some public attempt to deal with the problem.

What is the government response? They are going to monitor the situation. Consumers are going to have to pay for yet another monitoring scheme that’s going to tell them what their weekly trip to the supermarket tells them: that food prices are rising at an incredibly fast rate. The scheme proposed by the government is not an adequate way to deal with the problem. It’s just another in a continuing series of moves to get away from dealing with the problem.

Consumers in Ontario don’t want another in a continuing cycle of non-productive and non-acted-upon inquiries, reports, studies and monitorings. They want one thing: they want action on food prices; and they want it now.

The government obviously doesn’t agree with the consumers of Ontario. Last week the Minister of Agriculture and Food (Mr. W. Newman) was speaking -- it’s reported in the Hamilton Spectator of April 21. What was his response, on behalf of the government, to my proposal to establish an Ontario food prices review board? Let me read some of the things he’s reported as saying:

I’m quoting: “I think we live in a free enterprise system and that’s the one I believe in. Competition in the food industry is fair.”

How about: “The government should not interfere with food retailing.” Or try this for blaming the victim -- and the minister was very good at it, he claimed consumers are partly responsible for those increases: “There are substitutes; but if the consumer wants to pay $1 or $1.30 for a head of lettuce, it’s up to her.” That’s the response of the government. If you can’t ignore it, Mr. Speaker, you blame the victim, the consumer.

The Minister of Agriculture and Food and his government choose to ignore the basic concept of the board as proposed by myself and my party. That is that its mandate, in the broadest terms, would be to protect consumers from unjustified, unfair or excessive increases in the price of food. If all those corporate citizens who crowd in between the farm gate and the supermarket checkout counters are good guys they’ve got nothing to worry about; if they’re not ripping off consumers they don’t have to worry, they won’t be the subject of a board order.

An Ontario food prices review board as I propose it, is fairly clear from the resolution. I tried to make it as clear as I could in the resolution. It doesn’t require a massive bureaucracy to operate. It’s going to deal on a selective basis; it’s going to move when there’s a prima facie case of unfair, unjustified or excessive increase in the price of food, it’s not going to investigate everything that moves in the province.

The board, as I propose it, will have the effect of holding down unwarranted increases because companies will know they could be the subject of investigation by the board and they are going to have to think twice or three times before they consider making an unwarranted increase in the price of food.

The board will very simply have the power to investigate fully. The board will have the power to get full and complete disclosure of information from corporations involved in the food industry. The board will have the power to delay an increase while an investigation is going on. When the board finds that an increase is unfair, unjustified or excessive, it will have the power to roll it back. That is consumer legislation with teeth, and that’s something this government needs to learn about for a change.

The legislative initiative is a step in the right direction. My resolution, calling for the creation of an Ontario food prices review board, provides a short-term method of dealing with one of the major problems that arise from the current government’s food industry policy. That policy is going to have to be alerted. There is going to have to be a practical, fair and fundamental change in our food policy in this province.

Low, stable food prices, a secure and adequate income for the family farmer, self-sufficiency where possible in food, preservation of farm land and a shift away from large agribusiness must be the heart of a new Ontario food policy in the coming decades. We can no longer afford a policy such as that of the Conservative government of Ontario. It’s a policy that is narrowly based. It’s geared to supporting large agribusiness at the expense of the family farmer, the environment and the consumer.

Mr. Deputy Speaker: The honourable member has 45 seconds left. Does he wish to reserve that?

Mr. M. N. Davison: I’d be quite happy to give it up so that other members can participate in this important debate.

Hon. Mr. Drea: Mr. Speaker, I rise in opposition to this resolution, not because I doubt in any way the sincerity of the member in putting it forward and notwithstanding some of the remarks he has made about me.

In this regard I think like every member of the House, indeed everyone in public life today, he is concerned not only with the rising cost of food but the impact it has. However, I think it is incumbent upon me to point out that his proposed solution not only would be ineffective but also would ultimately mean higher prices for the consumer.

First of all, it would be very difficult for any provincial agency to effectively control prices established by the futures market. I know of no jurisdiction this board would have over such items, particularly sugar, cocoa and coffee. I know there has been a definite attempt to keep the producers’ marketing board out of this, but the proposed board would not be able to control prices established at auctions, which is the most common way for establishing prices for red meat, particularly beef, coming on to the market. The combination of those two, both the ones controlled abroad by commodities markets and beef here, does account for a large portion of the consumer dollar.

In addition, wage settlements in the food industry affect prices, and yet the proposal makes no mention of wage controls or guidelines -- although I will give the benefit of the doubt to the view that the increase in wages, whatever it might be, would be considered a justification for the price increase arising from it.

The history of this is that there have been three federal attempts, three federal agencies established, to control costs to consumers in the food line. The federal Food Prices Review Board was not able to control food costs; nor was the Centre for the Study of Inflation and Productivity. Even the Anti-Inflation Board, the only agency with the power to roll back prices, excluded all produce and imported foods from its mandate. Even the food costs it did control continued to rise, perhaps not as spectacularly as today but on a very steady basis.

The cost of produce cannot be controlled by government any more than we can control the weather. The reason the cost of lettuce is high is that it does not originate from Ontario at this time; it originates primarily from the southwestern United States. There has been an extremely bad crop this year. When crops are wiped out south of the border, the laws of supply and demand force prices up here.

It would be unconscionable at this time of government restraint to impose the burden of another government agency on the taxpayers of this province. The remark has been made that I am putting on another agency. I am not; nor is my ministry. There is already a great deal of data in the marketplace; it is simply a matter of compilation and a method of getting it out.

As I have mentioned, many of the food items, particularly those that are the most volatile in pricing, are imported from other countries, or they are manufactured in other provinces. If we did have an Ontario food prices review board, what right are we going to have to go into Quebec and demand information from a processor or a middleman there? The member looks at me in amazement. There are lots of products put on the shelves here that are processed in Quebec. Is he going to go to Quebec and say: “Give me your books, Mr. Quebec Company, and everything else”?

Mr. Swart: That’s a straw man.

Hon. Mr. Drea: It’s not a straw man; it’s a very essential point.

Mr. Swart: We’re big enough in Ontario to have a real clout on retail prices across the whole country.

Hon. Mr. Drea: I think I’m big enough to have a real clout.

It is very difficult for a provincial board to demand that kind of financial data from people outside the jurisdiction.

Finally, the solution to increased food costs is not through government controls. The real answer -- and it’s not semantics -- is selective shopping. The only way you can have selective shopping -- in other words, buying the commodities and buying the products that are priced justly and fairly and forcing down those that are priced unjustly or unfairly by the very glare of the public spotlight -- is to provide the consumer with as much necessary information as is possible.

Right now, one of the problems with food shopping is the aura of mystery that surrounds the marketplace: The product is here today, up there tomorrow, back down here the next day. Nobody can really understand.

The throne speech announced that we were going to do a monitoring program. The monitoring program is not going to make decisions for people; it will adequately arm them so that they can go into the marketplace and make the decisions they are capable of. They can see where the price increases are coming from. If the price increase is at the farm gate, then God bless the farmer, because he hasn’t had many good years and it is about time he got a good return.

[3:45]

If indeed there is some hanky-panky between the farm gate and the time it gets on the shelf, then the consumer is perfectly capable of taking the appropriate action which will put an end to that type of nonsense. Indeed, even the proposer of this monolithic, tinkering, snooping board points out that the very fear of being caught will end a lot before it occurs.

One of the things I would like to talk about today, and I draw it to the attention of the member, is that one of his problems is he does not have accurate figures. I don’t mean this in a derogatory way. Using 12 centres -- I presume that is the Canada one -- pork has come down almost six per cent in Ontario. I think realistically, when he is putting forward positions and saying people are changing their nutritional requirements in their diet, they are taking advantage of other types of meat that are going down, rather than coming up. That is another thing that we intend to do in this.

It will be all Ontario, not weighted for British Columbia, not looking at Newfoundland. I sympathize with them but it is not the problem here.

I want to serve notice and this is a very good occasion. One of the problems with beef prices -- and his beef prices are a little bit on the low side. I am not going to take any time today but I will certainly send him over the accurate ones -- one of the real difficulties has been the steady increase in the retail margins between the processor and what the consumer pays for it.

Last December I was asked to produce a report on the status of beef prices and the markups in this province. I pointed out January 1 of this year that the spread was 54.7 cents. In the first week of April this year it was already up to 72.2 cents. That is an increase of over 30 per cent. That is contributing more than anything else to the relatively high cost of beef. Indeed, in that period of time the producer’s share of the dollar has dropped by two per cent.

We are watching that extremely carefully. I expect, in the very near future, the supermarkets to do their duty, that that spread will start going down so the producer, particularly in the beef field where it is very well deserved, will be getting, quite frankly, his fair share of the market.

In closing, I would point out the responsibility for keeping food costs down is not going to be solved by the establishment of such a board. The responsibility ultimately lies with three groups. Industry must exercise restraint in its pricing policies and resist the temptation to catch up overnight, particularly in a case where federal subsidies are removed.

I can hardly see this provincial prices review board going down to Ottawa, whichever government is there after May 23, and saying to either Mr. Whelan, the incumbent, or to whoever his successor is, “Don’t you touch that subsidy on milled grain, my friend, or we will” --

Mr. M. N. Davison: Why not tell Weston not to take advantage of that?

Hon. Mr. Drea: Oh, come on, please, please.

I can imagine that tremendous scene. There will be five fewer civil servants. They are going to put five on this board.

Secondly, government responsibility is to demand explanations of price increases from industry and to provide that information to consumers in a meaningful way, not on a weighted average, not on what a board decides on two or three commodities, but in a way the person can watch. They can watch the introduction of the product, they can keep track of seasonal variations, whether it is meat or produce, whether it is canned goods or what have you.

Finally, consumers themselves; this is where we say, selective shopping having armed you with all this information where you do understand what is going on, you make your free choice in a free marketplace.

Any attempt there has ever been to control the price of food has been a disaster. The last real one was in the United States in the middle of the second Nixon administration. I look across at the member for Essex North (Mr. Ruston). I recall we were together in Lansing, Michigan, at the height of that and I can recall the restaurants didn’t have meat because the fanners were withholding their food from the market because they couldn’t get a decent price. This is precisely what this kind of board would inevitably do.

Mr. Breithaupt: Mr. Speaker, in the 1975 election we issued a booklet entitled, Priorities. We recognized at that time a need for a mechanism of some kind that would monitor price increases in order that the best interests of the consumer were served.

With respect to consumer protection, the booklet stated: “The Liberal Party believes that the people of Ontario must receive the highest possible quality of goods and services at affordable prices. We aim to protect consumers from unjustified swings in quality, safety and prices, whether for shelter or food, clothing or transportation, by setting standards and maintaining them. The Liberal government would strengthen the Ontario Food Council as a consumer watchdog to investigate unacceptable price rises and provide consumer information on food, quality and price.”

Today’s resolution shows the interest which the New Democratic Party, of course, has in this subject. We have been equally pleased to see that the Conservative government has realized the need for some action in the proposal which was set forth in the throne speech and was followed by the announcement in the Toronto Star on Tuesday of this week.

The food industry of Ontario and, indeed, of Canada is neither isolated nor self-sufficient. Inflation, the effects of weather and world commodity prices are all factors which cannot be ignored. Inflation has sent costs up at every stage of food production. We have found ourselves to be slaves to our climate in many instances where inflated prices of imports have occurred. This all leads to the attempt to find a scapegoat to blame or constantly rising prices.

Yet, Mr. Speaker, when you talk to various sectors in the industry, you find great difficulty in pinning the blame on anyone. Producers are starving. Wholesalers claim to be taking only fair profits and apparently the supermarket business is said to be so tight and highly competitive that profit margins, we are told, have been trimmed to the bone.

How, then, does one deal effectively with increasing food prices? The member for Hamilton Centre commented on the increases that the Anti-Inflation Board saw last year and referred to the fact that beef prices rose 65.9 per cent in that period. Canadian shoppers spend some 13.1 per cent of their disposable income on food which is about the same as in the United States. No one escapes from that expense.

Let’s consider the farmer, the first step in the production process. As the member for Hamilton Centre has mentioned, the investigations of this review board would commence after the farm gate, so that increases for the farmer would be protected. One of the biggest problems for Canadian farmers is that of import competition. They can be as hard hit by US and Mexican imports during our growing season as by the volume of those imports during the winter months and because of the growing periods at the time. So the blame isn’t there.

The market boards are between the farmer and the retailer. They finance their operations by a levy which the farmers pay as a percentage of sales. We have some 23 such boards which, in 1976, handled $1.5 billion worth of products. The idea of the boards, of course, is to provide fair returns to fanners and to attempt some price stability.

While this might suggest farmers to be land barons who are trying to garner the best prices they can with monopoly control, that doesn’t actually occur, least of all in the experiences we have had with the price of beef and our knowledge with respect to the three-year cycle that is involved in the pricing of that item. It may just be that the stabilizing influence on commodity prices is something which should be further reviewed.

At the retail level we’ve talked about excessive profits and we’ve had before the Legislature various leaders from that side of the operation who have commented upon the actual amount of the purchaser’s dollar remaining for the company when all of the cost of goods and component parts are removed.

According to the Ontario Public Interest Research Group, more than 2,000 food and beverage companies closed in Canada between 1961 and 1971. They couldn’t compete with the larger companies that were moving in at that time. The trend is certainly towards fewer corporations controlling more of the sales. Right now, 1.5 per cent of companies in the food and beverage industry control 75 per cent of the sales. Forty-five of these 72 companies are foreign controlled.

In concentrated markets profits are high. In order to have higher profits you must have higher prices. This is not to accuse the food companies of conspiracy but, rather, such trends occur as a natural consequence of corporations controlling a sector.

Since 1935, there have been over six federal inquiries and a similar number of provincial ones into food policies and prices and nothing really has been done as a result. The fact is, there are no easy answers.

No government could pass a law which would make farmers, processors, retailers and consumers all happy at the same time. What does appear to be effective in the war against high food costs are the community groups which have been organizing boycotts against certain products whose prices have risen drastically and unjustifiably. According to the Brampton head office of Women Against Rising Prices, WARP, the prices of two beef items, blade roast and shoulder roast, dropped after they urged a boycott of any beef priced higher than $1.79 per pound. After a two-week boycott of potato chips, the price of that product dropped, we are told, from 99 cents to 59 cents.

Under the Ministry of Agriculture and Food, there are over 40 governmental bodies to which provincial government either allocates funds or at least appoints some members. At least eight of these bodies could be similar in nature to the board proposed by the member for Hamilton Centre. They include the Farm Products Marketing Board, the Milk Commission of Ontario, the Ontario Apple Marketing Commission, the Ontario Cream Producers’ Marketing Board, the Ontario Corn Council, the Ontario Milk Marketing Board and the Produce Arbitration Board.

In addition, the eighth one is the Ontario Food Council which may have its operation somewhat changed, resulting from the report of the member for Lanark (Mr. Wiseman).

I have certain reservations about this resolution, that’s true. I hate to think, for example, that this government is going to appoint five more of its friends to another board. I wouldn’t want the board to duplicate any of the other activities which are necessarily being done. I would like to replace some of the existing boards, if that is going to be the thrust of this product marketing board, so that we would not have duplication.

We have to find out whether the current inquiry into food prices is going to bring in satisfactory results and have some actual changes which would influence the need or otherwise for this board. However, if the proposed food prices review board can influence food prices in a similar fashion to the Brampton experience I have quoted, then it may well be our most effective tool. But the point is we need some kind of monitoring mechanism, because food is quite an unavoidable expense for all of us and particularly for those on fixed incomes who suffer terribly as the purchasing power for such an avoidable expense is eroded.

The only solution for some elderly people is to change their diets by diminishing and cheapening both quantity and quality. That is a consequence none of us would ever like to think could become a reality in a province of opportunity like Ontario. To this end, we welcome the concept of a consumer watchdog in this as a board or in any other acceptable form. I am pleased to support the resolution.

Mr. MacDonald: Mr. Speaker, I am sorry the minister isn’t here because I wanted to begin with his statement this afternoon in my comments on this resolution. He is capable of extraordinary political footwork and he usually ends up by making the government look as though it’s fairly good and even demanding resignations from the other side of the House for alleged misdemeanours.

The interesting thing in that case of the two Carnation milk cans is that the company contends that the correction was made at the wholesale level. This was their contention yesterday when the media got in touch with them. They didn’t know what had happened at the retail level. The minister’s explanation is at the retail level another poor clerk takes the rap. They made a mistake. This is the standard explanation we get time and time again when there is a mispricing; namely, that the mistake has been made by one of the clerks brought in on a part-time basis at a low wage for marking up prices.

Hon. Mr. Drea: It’s a union company. You had better be careful.

Mr. MacDonald: Not with the part-time people, and it’s the part-time people who are dragged in over the weekend and overnight sometimes to make many of these changes. I know something about the supermarkets. I have been looking at the supermarkets for quite some time in their operation.

Let’s not be misled by the minister’s fast footwork in dismissing this example because before the week is over and before the next few weeks are over, we will have many examples of consumer ripoffs in metrication. I am not going to take the time this afternoon to document them. We will come to it in good time.

Hon. Mr. Drea: Give them to me.

Mr. MacDonald: The minister had his chance to speak. Now let him just listen for a moment.

Hon. Mr. Drea: Then keep your attacks to yourself.

[4:00]

Mr. MacDonald: This problem of what happens beyond the wholesale level or beyond the farm board level is something that we have talked about many times. Many times, for example, the milk marketing board has come to the government and said, “Why is it fair that you should regulate the price the farmer is going to get?” But there is no regulation at all, no investigation to find out whether there is a justified increase at the processor and the retail level. So they play games in terms of orchestrating prices in order to try to lure the customer in.

Some reference was made by the last speaker to the impact of the efforts of WARP, the group centred -- it is all across the country now, but it was centred originally in the Premier’s own home riding. The prices came down when they began to list and to boycott for certain weeks. When they list their products at the beginning of the week, these are the ones the supermarkets then seize upon as the specials -- they reduce their price for that week in order to try to counter the boycott for that week. But, of course, the next week up it goes again.

There is a certain reality here we have to recognize in the nature of the food industry. The food industry is not only fantastically complex, it is also very significantly integrated. When one talks about a retailer buying from a wholesaler, and a wholesaler buying from a processor, and a processor getting that food from the farm gate by truck, one gets the image of hundreds, if not thousands, of middlemen involved there. The reality is that increasingly there are four or five conglomerates.

The retailer is owned by a conglomerate, and the wholesaler he buys from is owned by the same conglomerate, and in many instances the processor the wholesaler buys from is part of the whole conglomerate -- the Weston empire for Loblaws, the Argus empire for Dominion Stores.

So you can play games in orchestrating the prices, and not only at the retail level. It has been traditionally done at this level as was documented in one of the research studies for the farm income committee as far back as 1969. But you can play games back through the chain. What appears to be a change in price may be a manipulated price between two corporations that are part of the same conglomerate.

Let me come to the minister’s approach; his approach always is that the best defence is offence. The other day he thought he was setting us back on our heels by saying that very shortly he is going to unveil a great program -- 37 monitoring stations across the province --

Hon. Mr. Drea: Thirty-nine.

Mr. MacDonald: -- getting facts on the pricing of food.

That will be fine; I will be the first to applaud if the minister sets up adequate monitoring and provides the information to the public. That will be something of a contribution because we don’t know what goes on in the food industry. Beryl Plumptre’s rather sham effort up in Ottawa -- on one occasion she did venture into monitoring, on a comparative basis, certain supermarkets in Ottawa and Hull, but it stopped after a week. This “food basket,” this hole-in-the-wall effort that this government has conducted for a long time -- we don’t know what stores they monitor, we have no information at all; all we get is their aggregate figure.

So in this monitoring system, if we get some more information about what is going on in the food industry, that will be good. But having conceded that as a minor step forward, I say to the minister that will not be good enough. Because then one has to rely totally on the marketplace to correct it, and the marketplace isn’t going to correct it, even with the valiant efforts of WARP, the Women Against Rising Prices. They can’t go on for ever and a day, having taken the initiative in trying to expose what goes on in prices and trying to expose the orchestration of prices by the supermarkets.

What we must have is some agency of government that has the power to move in and to investigate any unexplained extraordinary increase in prices and to expose it to the public. What is more, if such increase is not justified, that agency must have the power to roll it back. That is the proposition put forward in this resolution by my colleague from Hamilton Centre.

One must bear in mind that 80 per cent of the food industry lies beyond the farm gate; 80 per cent of the food industry lies in these highly integrated conglomerates. The retail outlets of those four or five conglomerates now control more than 70 or 75 per cent of the food retailing business in Ontario. There is no real arm’s-length relationship in the purchase of that food, because they are buying it from another fellow in the conglomerate.

The net result is that the farmer often gets too little and the consumer is paying more than is necessary. Let me just pause and underline that; The consumer is paying more than is necessary. That remains a fact, even though it may be true in Ontario and in this country that less of our expendable income is going for food than in practically any other country in the world.

The consumer is paying more than is necessary because of the high profits that are found in the food industry; when representatives of the industry were before the committee, we found that theft profits were in the range of 15 or 16 per cent. How much of that is drained off from the retailer into one of the other corporate brothers and sisters within the conglomerate, we do not know, because it can be so easily done.

The role an Ontario food prices review board will not be to establish an across-the-board price control. We all recognize that if we establish across-the-board price controls, we may correct some inequities to begin with but inevitably in a dynamic economy new inequities emerge, and we cannot get at them within the straitjacket that is being established. But with the flexibility of a consumer champion, an organization that has the power to zoom in whenever there is an excessive increase in prices to get the explanation for it and to roll back that price increase if the company won’t move, is going to have a very salutary effect across the board.

We all know that, day in and day out, when we go to buy food at the supermarket, the price of the product that used to be 75 cents has suddenly become 95 cents. The only way we are going to be able to get these facts is through this kind of an investigation and with this power to roll hack.

I note that my time is just about up, Mr. Speaker. I welcome the kind of support that has come from the Liberal Party. I think we can proceed with this proposal without waiting for the report from the royal commission that is looking at discounts, because that is a narrow part of a very great and complex industry. It is not going to deal with the whole industry; it is only going to deal with its discount aspects. This board is necessary as a champion to protect consumers, because the information the minister is going to rely on as the sole solution is hopelessly inadequate to do that job.

Mr. MacBeth: Mr. Speaker, I attack this resolution on the basis of my prejudices generally against agencies, boards and commissions. I think these types of bodies for the most part are the antithesis of good government. I might even refer to them in some cases -- although, naturally, one cannot make wide, sweeping statements -- as the bureaucrats’ ripoff. That is a word I do not like, but it is one I have learned since entering this House, and I think very often these boards amount to just that; they spin their wheels, they burn a lot of rubber, they make a few backfires, but for the most part they go nowhere.

When I say “ripoff”, naturally I am referring to my thoughts and convictions that most of these boards, agencies and commissions cost the public of this province much more than they save it. I think this is another example of what might be happening here. There is not only the cost of the operation of these committees, but there is also the cost borne by the citizens of the province in appearing before these committees, in preparing their work and presenting arguments of one sort or another. These costs add up to millions of dollars. Where does the money come from?

Of course, these costs are added on to the cost of the service rendered, whether it is food, hydro-electricity, or no matter what it is.

Mr. Samis: It’s those lawyers again.

Mr. MacBeth: My friend is right; the lawyers make a good thing out of these agencies, boards and commissions. I am probably speaking against my self-interests, but some of us do that around here occasionally.

Mr. Samis: Speak for the public interest then.

Mr. MacBeth: Let me refer, Mr. Speaker, to some figures I have here in connection with Ottawa’s efforts on this matter. Establishment of an Ontario food prices review board would be a costly undertaking because it would inevitably lead to creation of a bureaucratic machinery.

Mr. M. N. Davison: Nonsense. All the staff is seconded.

Mr. MacBeth: They’ve got to be paid for. Don’t be silly. The Federal Food Prices Review Board was given a budget of $500,000 in 1973, and by 1975 the board had a staff of 75 persons and an annual budget in excess of $2.4 million.

Mr. Swart: That’s what you’re going to set up without any teeth in it.

Mr. MacBeth: All right. Don’t let the members opposite think this board they are proposing would operate for little or nothing.

Mr. Swart: Yours won’t either if it’s going to have 39 monitoring stations.

Mr. MacBeth: Don’t let the members think it doesn’t cost companies money to come before that board. The citizens of the province pick it up. I don’t mind that. I don’t mind paying $2.4 million, or whatever the Ottawa figure was, if it would save the taxpayers of this country $2.4 million in lower prices, but you and I know that’s not the case. That’s why I used the word “ripoff” -- which I very rarely like to use -- meaning that for whatever is put into this government expenditure you may return five cents on the dollar. That to me is absolute nonsense.

Let me give some examples of other boards, Mr. Speaker. The Canadian Transport Commission -- the Speaker is very familiar with that -- was originally set up to save the people of this country some money. It did one thing -- or certainly contributed in great part to one thing: ruining rail passenger service in this country. The Canadian Transport Commission laid down so many conditions and made it so awkward the railways were glad to get out of it. I mention that as an example.

Mr. Samis: That’s not a good example.

Mr. MacBeth: The Canadian Transport Commission is also interfering with Bell Canada. Contrary, probably, to the thoughts over there, I think Bell Canada is one of the best-run companies in this country. I wish we, as a government, at all levels could keep our prices down to the same extent as Bell Canada. Their rates have not increased one fraction of the amount taxes have gone up in this interval.

By way of an example of what they get into, I’ve recently had a little personal dispute with them. They wanted to charge me $28 for transferring my telephone account from one name to another. It happened to be my riding office account. That’s the sort of thing where the Canadian Transport Commission says, “Yes, you may do that. We will give your approval for that.” Then it becomes law. They can’t waive it; they just put the blame on the Canadian Transport Commission. It absolves the company -- Bell Canada, in this case -- from any responsibility in regard to it.

The point I’m trying to make is when you get boards like this operating somebody has to go into gimmick operations, make gimmick charges to make any money. Bell Canada is doing just that sort of thing. They’re trying to sell coloured telephones and things of that sort.

We ourselves set up the Ontario Energy Board in this province. I don’t think it’s saved the people of this province nearly one portion of the cost of operating that board. I say I’m sceptical; and my prejudices are showing.

Mr. Samis: That’s for sure.

Mr. MacBeth: There’s no question as far as I’m concerned that most of these boards are a bit of a fraud for the public. They cost the public far more for their operation -- not only their own operation, but also the trouble they put the public to -- than they ever return in the way of value.

Let’s take a look, for a minute, at food costs. There are not only the three people my honourable friend mentioned when he referred to what causes prices to go up. There’s another group in there that support them. They are the members’ constituents; they are my constituents -- they are the consumers. Consumers demand things today they really don’t need but they want them for convenience sake.

A short while ago I bought a 75-pound bag of potatoes. That’s the way to buy potatoes at a saving. You can buy them either at the farm gate or at one of the farm markets. There are many farm markets around. The public don’t want potatoes that way today. They want them washed; they want them scrubbed; they want them pre-prepared. They buy them in a little package of three, all ready to go in the oven for baking.

That’s why I say they are the fourth group we’re talking about. They are the constituents. They want to buy them in small quantities; they don’t want them in large quantities. They want them fancily packaged -- and goodness knows, they’re fancily packaged. They don’t want potatoes in the way I mentioned -- bought in a 75-pound bag; they want them flaked already so all they have to do is mix a little water with them.

[4:15]

Mr. M. N. Davison: That’s not how we eat our potatoes in Hamilton Centre.

Mr. MacBeth: Those are the sorts of things that are causing the costs to rise in part. They belong to the fourth group, that is, public demand. When I think of all of the fancy products I see in the store I’m not surprised that costs are rising. There is a way to get around these things if one wants. One can still buy products at the farmers’ market or at the farm gate or in quantity.

If we approve this resolution, we will simply be approving government for government’s sake. We’ve had these commissions and boards at Ottawa. We’ve had them in various places. One of the reports in Ottawa, and I’ll close with this states: “Based on a comprehensive investigation of 81. processors, eight wholesalers and 14 retailers, the Anti-Inflation Board concluded that for the major Canadian food processors and retailers, overall net profit margins, measured by per cent return on sales, have varied little from historic norms during the recent upsurge in food prices. The consumer price index rose 27.2 per cent during the prices under study by the Anti-Inflation Board.”

I have been reading from a study of profit margins in the food industry by the Anti-Inflation Board in February 1979. What I am suggesting to this House is that we can establish all the boards and commissions we want, but the reports we’ve already seen on this type of thing would indicate that prices in the food industry, as well as in many other industries, have not risen unduly in line with other things. I don’t say we haven’t got inflation --

Mr. M. N. Davison: They’ve risen 21.7 per cent as opposed to a general increase of nine per cent.

Mr. MacBeth: -- we’ve got inflation, but these increases are not out of line with other things that we are buying. To impose a board of that nature, and many other boards and commissions that we have in this province -- and I can be critical of the government for many of the boards we have -- instead of saving the people of this province money is simply adding to the cost of operation --

Mr. Samis: Why didn’t you do something about it?

Mr. MacBeth: -- creating more red tape and is a nuisance. It is government for government’s sake.

Mr. M. N. Davison: Laissez-faire is not the answer.

Mr. McGuigan: Mr. Speaker, I rise to support the resolution in principle but not in all of its substance. I share the member’s concern about rising food prices, as a member from a food-producing constituency, as a farmer myself and as the elected representative of consumers who feel the adverse effects of the present rising food prices.

As a farmer representative, I can say that farmers do not fear the investigative powers that might be granted to such a board because they have nothing to hide and they are not making excessive profits, but they don’t see the need for such a price review board because they feel that we already know the causes of rising food prices. We heard of the number of review boards that have preceded this one under discussion today.

Some of these results of the needed adjustments that are taking place in the food system are the cause of it. Clerking or working in a store or in a processing plant is no longer the subsistence level income that it once was. It is not on a par yet with industrial wages but if one looks back over the historical relationships, one will find that the gap has closed, and justly so. People working in this industry require decent wages.

I know myself from rising at two or three o’clock in the morning and going to market in Detroit, Windsor, London, Sarnia and sometimes Toronto and arriving at six o’clock to have the wares on display for the wholesale market, that the people engaged in that industry are just as skilled in their activities as are the people who work on assembly lines as machinists and tradesmen. They deserve to earn good wages. Consumers can’t expect to escape the consequences of that. I’m afraid my friends on the left are often the first ones to complain about the results of that.

Farm labour deserves the same breaks, and in those fields where the producers are shielded from imports and where production is controlled to match demand plus a small overrun -- and I emphasize that in every one of the quota-controlled marketing plans they do arrange for a small overrun -- the farm workers do receive good wages. If the members doubt this, let them look at any farm paper and see the wages, fringe benefits and accommodations offered to herdsmen or to people who work with dairy herds.

Producers who don’t have a favourable marketing situation -- those who compete directly with the United States and Mexican farmers -- can’t afford to be so generous. We found this out when the farmers of British Columbia first joined the Farm Income Insurance Plan. They reduced their production to meet only the local demand, and the workers, the professional people, people from all walks of life, took to their cars and went over to Bellingham, Washington, to make their food purchases.

Fruit and vegetable fanners would love to pay industrial wages, but they find they cannot do so when they compete freely -- that is, with very little tariff protection -- with the United States, where the minimum wage is $2.65 an hour, compared with our $3 an hour, and the minimum wage in the United States is very poorly enforced. In the view of many observers, it’s a matter of US public policy -- unstated policy, mind you, but public policy nevertheless -- to allow in Mexican workers; the figures vary, according to the authority, from four million to 10 million people.

One need hardly dwell on the effects of rapidly rising petroleum prices. Petroleum products are the raw materials in nitrogen fertilizers; in plastics for packaging fertilizers, supplies and foods; for making plastic twine; for making fires; for producing pesticides; and, of course, for transporting, drying and processing food. As these production prices rise, food prices will rise as a consequence.

In the foregoing, we are talking about fundamental economic shifts that have taken place. These are shifts whereby wealth is transferred from consumers to producers; I’m mainly talking about shifts from the people who use petroleum products to those who produce them.

The member nations of the Organization of Petroleum Exporting Countries have vowed that, as fast as we inflate the price of our food and manufactured products that we send them, they are going to raise the price of their oil.

We cannot escape those changes in food prices, but there are other areas that can be acted upon. It’s not likely to happen, though, under this government because of its attitude which it has well shown over its 36 years in power.

When the allegations were made a year ago about discounts and allowances in the food industry, the government’s reaction was that such practices were normal business practices. This government has taken refuge behind the Farm Products Marketing Act and has said to farmers: “Here is the act. Use it; it’s your only defence.”

I would submit that the Farm Products Marketing Act by itself is an excellent tool, but it’s not the total answer. Marketing boards that go to a chain store and say, “We have a good supply of this product. Would you feature it? Would you give it more space? Would you advertise it?” do get good co-operation, and the chains do move great quantities of food. But they are not going to go to those stores the next day and complain to those people abou