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May 9, 1983

32nd Parliament, 3rd Session

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Hansard Transcripts

QUESTIONS TO MINISTRY OF EDUCATION

COMMISSION ON ELECTION CONTRIBUTIONS AND EXPENSES

MEMBERS' PRIVILEGES

VISITORS

STATEMENTS BY THE MINISTRY

KENTUCKY DERBY

DAY NURSERIES ACT REVISIONS

BUDGET

ORAL QUESTIONS

BUDGETARY PROCESS

TRUST COMPANIES

VISITOR

BUDGET INCENTIVES

MASSEY-FERGUSON

ONTARIO VETERINARY COLLEGE

STELCO EMISSIONS

ROLE OF CIVIL SERVANT

UNEMPLOYMENT

UNEMPLOYMENT IN TOURISM INDUSTRY

FOREIGN STUDENT FEES

BORG-WARNER

MOTION

COMMITTEE SUBSTITUTIONS

INTRODUCTION OF BILLS

STAR OF PROGRESS SPIRITUAL CHURCH ACT

LABOUR RELATIONS AMENDMENT ACT

RESPONSE TO WRITTEN QUESTIONS

MOTION TO SET ASIDE ORDINARY BUSINESS

BUDGET SECURITY

The House met at 2 p.m.

Prayers.

QUESTIONS TO MINISTRY OF EDUCATION

Mr. Foulds: Mr. Speaker, on a point of privilege: I wonder if you might inquire of the Premier (Mr. Davis) whether under standing order 27(

h) he has instructed the parliamentary assistant to the Minister of Education (Miss Stephenson), in her continuing absence because of her health, to answer on her behalf.

Mr. Speaker: I think it is really not my responsibility to pass along questions to other members. I would suggest that perhaps the appropriate time to raise this would be when the Premier or the Deputy Premier (Mr. Welch) arrives.

COMMISSION ON ELECTION CONTRIBUTIONS AND EXPENSES

Mr. Speaker: I beg to inform the House I have today laid upon the table the eighth annual report of the Commission on Election Contributions and Expenses for the year 1982.

MEMBERS' PRIVILEGES

Mr. Speaker: At this point I wish to rule on the question of privilege that the Leader of the Opposition (Mr. Peterson) raised on Friday last. The question is of considerable importance and I have carefully reviewed the arguments presented by a number of honourable members as well as the cases specifically cited and the parliamentary law texts.

The privileges of the House are stated in general terms in the 19th edition of Erskine May's Parliamentary Practice at page 67 as follows:

"Parliamentary privilege is the sum of the peculiar rights enjoyed by each House collectively as a constituent part of the High Court of Parliament, and by members of each House individually, without which they could not discharge their functions, and which exceed those possessed by other bodies or individuals."

To be considered a question of privilege, a matter must pertain to a right or immunity which the ordinary citizen does not enjoy. These special rights and immunities allow the Legislature to meet and carry out its proper constitutional role, members to discharge their responsibilities to their constituents and persons involved in the parliamentary process to carry out their duties and responsibilities without obstruction or fear of prosecution.

The principal privileges of the House or of its members are cited in the Australian parliamentary text, House of Representatives Practice, at page 645, and include the right of free speech in Parliament, the right of the House as a body to freedom of access to the Lieutenant Governor, immunity of members from arrest, detention or molestation for civil causes during defined periods, immunity of members from the obligation to serve on juries, immunity of witnesses summoned to attend before the House or one of its committees from being questioned or impeached for evidence given before the House or a committee, the power to order the arrest and imprisonment of persons guilty of contempt or breach of privilege, and the power to expel members.

The Leader of the Opposition and the member for York South (Mr. Rae), as well as a number of other members, stressed the importance of ensuring the secrecy of the provisions contained in the budget until it is presented in the House, the responsibility of the Treasurer and Minister of Economics (Mr. F. S. Miller) to take all the necessary steps to preserve the confidentiality of the budget, and the right of the House to call the minister to account for any breaches of budget secrecy.

The budget by its very nature must be kept secret until it is presented by the Treasurer in the House. Such a practice is, of course, necessary to prevent financial speculation and the loss of revenue to the government treasury. These reasons were enumerated by honourable members on Friday last. However, I have been unable to find any precedent which states that the matter of budget secrecy is one which may be treated as a question of privilege. The Leader of the Opposition made reference to two cases in the United Kingdom concerning budget disclosure.

In neither of these cases was the matter treated as a breach of the privileges of the House, nor were the cases sent to the committee on privileges for inquiry.

The 1936 case, involving Mr. J. H. Thomas, concerned a disclosure by Mr. Thomas, of certain budget secrets, when he was colonial secretary. The matter was investigated by an extra-parliamentary tribunal of inquiry and the secretary was found to have, without authority, disclosed contents of the budget. Mr. Thomas resigned on his own initiative from the government and from the House. The 1947 case, involving Hugh Dalton, the Chancellor of the Exchequer, concerned the disclosure to a reporter of budget information. The matter was raised by way of a notice of motion standing in the name of several private members.

The motion called for the appointment of a select committee to inquire into the circumstances of disclosure. Mr. Dalton resigned on his own initiative the position of Chancellor of the Exchequer before the select committee was struck to consider the matter.

Budget secrecy is a political convention, as is the practice that the Treasurer presents his budget in the House before discussing it in any other public forum. It has nothing to do with parliamentary privilege. My decision is supported by the decisions of a number of Speakers in several jurisdictions, including Speaker Sauvé on November 18, 1981, and most recently on April 19, 1983, and Speaker Smith of the Legislative Assembly of British Columbia on April 1, 1976.

I would also direct the attention of honourable members to the comments of Joseph Maingot in his text, Parliamentary Privilege in Canada, where he states: "Parliamentary privilege is concerned with the special rights of members, not in their capacity as ministers or as party leaders, whips or parliamentary secretaries, but strictly in their capacity as members in their parliamentary work. Therefore, allegations of misjudgement, or mismanagement, or maladministration on the part of the minister in the performance of his ministerial duties do not come within the purview of parliamentary privilege.

And neither does an allegation that a minister permitted a budget leak constitute a matter of privilege."

In finding that a prima facie case of privilege does not exist in this case, I am making a procedural decision the effect of which will not prevent the further discussion by the House of the matter. The effect is to refuse precedence to this matter as a question of privilege but not to prevent the presentation of this matter under different circumstances on another occasion.

2:10 p.m.

The disclosure of information relating to the budget has to do with the conduct of a minister of the crown in the performance of his ministerial duties. Allegations that the Treasurer failed to ensure the secrecy of the budget and thereby permitted a budget leak may only be raised by a substantive motion of want of confidence in, or censure of, the minister. The purpose of such a motion is to question or bring to account a minister's responsibility to the House.

In support of such procedure for making direct accusations against the holders of certain offices, including ministers, Speaker Michener stated on June 19, 1959, "Simple justice requires that no honourable member should have to submit to investigation of his conduct by the House or a committee until he has been charged with an offence." Such a charge is raised by way of a substantive motion.

Finally, the member for Renfrew North (Mr. Conway), joined by the member for Riverdale (Mr. Renwick) and the member for Essex South (Mr. Mancini), claimed it was a breach of parliamentary privilege for the minister to have spoken to the press about the alleged disclosure of information relating to the budget before making a statement first to the House. As I stated in my ruling of February 1, 1983, "Although it is a courtesy to the assembly for a minister to release information in the assembly before releasing it to the press or to the public, it is not a breach of the privileges or rules of the assembly if this does not happen."

VISITORS

Mr. Speaker: I would like to call the attention of all honourable members to the presence in the Speaker's gallery of a delegation of Boy Scouts representing the 75th anniversary of scouting. These boys have spent the day at Queen's Park and will, on behalf of the Boy Scouts Provincial Council of Ontario, present a plaque that will be displayed in this building.

I am certain all members join with me in welcoming our guests and in recognizing the outstanding contribution made by Boy Scouts over these past 75 years.

STATEMENTS BY THE MINISTRY

KENTUCKY DERBY

Mr. T. P. Reid: We won.

Mr. Breithaupt: What looks good in the fifth?

Hon. Mr. Drea: He won. If the members had listened to me --

Mr. T. P. Reid: You have to be good at something, Frank.

Hon. Mr. Drea: Mr. Speaker. before coming to the statement that was supposed to be delivered on Friday but unfortunately could not be because of other events in this House, it is my distinct honour this afternoon to convey the official congratulations of the government of Ontario and the people of Ontario to Sunny's Halo for that most distinguished and most magnificent mile and a quarter on Saturday afternoon.

Interjections.

Mr. Speaker: Order.

Hon. Mr. Drea: I think the particular win by this most distinguished and most courageous horse should be put into the economic perspective of this province. First of all, it was a very distinctive win by virtue of the fact that Sunny's Halo, like so many great products of Ontario, has had to overcome great adversity in order to triumph. It is a matter of record that last year that horse was running on a wrenched ankle and bucked shins. Very few horses ever come back from there.

Mr. T. P. Reid: Just like this government.

Hon. Mr. Davis: And just like Sunny's Halo, we will win again.

Mr. T. P. Reid: He won by a nose. You might win by another part of the anatomy.

Hon. Mr. Drea: The racing and the breeding industry in this province is a very significant part of agriculture. I think it should be brought to the attention of the House that in the last three years the racing stars of this province have brought the breeding and racing industry of Ontario into worldwide prominence. First, there was Glorious Song, an Eclipse winner, probably the greatest mare who has run in our time. Second, there was Deputy Minister last year, who unfortunately because of an accident has never reached his full potential, and now we have Sunny's Halo.

This will mean, in the fall, vastly increased sales and export dollars, because never before has the sire of this particular horse had an outstanding colt. It will mean new farms started up. It will mean better wages for a large number of people who depend on the racing industry and, indeed, for those who would risk not only their time but also their personal funds, as Mr. Foster has. He bred that horse, he stayed with that horse, he maintained that horse and he is fully entitled now to recognize the fruition of a particular dream as well as the great honour and distinction he has brought to this province.

It is also a matter of record that it has been one of the outstanding accomplishments of this government that we have invested for so many years in the breeding and racing industry of this province. Indeed, without government support, government initiative and government backing it is a well-known fact that the industry would not be in the position where we now stand in the forefront of the world.

Once again, I speak on behalf of all the people of this province who were thrilled, in the greatest individual sports spectacle of the year, to see an Ontario horse come well ahead, winning against all the odds and showing what not only Canadian initiative but Ontario talent can produce.

DAY NURSERIES ACT REVISIONS

Hon. Mr. Drea: Mr. Speaker, if I may come to the statement that was to be delivered on Friday last, I would like to advise the House of revised standards for the Day Nurseries Act of Ontario which will become effective January 1, 1984.

These standards are based on a consultation paper prepared by my ministry following a review of current literature on child development and preliminary consultation with authorities in the day nurseries field.

The paper was distributed province-wide in February 1980 to more than 5,000 child care experts and workers, parents and other groups and individuals interested in day nursery services. Staff from my ministry discussed the proposals contained in the consultation paper with more than 1,000 individuals at meetings in various communities across Ontario and we reviewed 101 written submissions on these proposals.

Most of the changes simply clarify the intent of existing regulations, some of which are imprecise and open to misinterpretation. Other changes bring the program into line with current knowledge of child development and existing practices in most of the province's day nurseries. Overall we believe we have streamlined and simplified the regulations. At the same time we have improved the quality of care for children in day nurseries and in supervised family day care.

Although the new standards will become effective January 1, 1984, existing operators of day nurseries will have until the date of their annual licence renewal next year to comply with them.

The following are the highlights:

Beginning next year, all agencies supervising private home day care must be licensed. There are now 5,000 spaces in these family day care settings in Ontario, of which 4,000 are subsidized by my ministry. These agencies employ home visitors to assess family homes for day care and to provide training and support to the care givers. The new regulations stipulate that the maximum number of homes that each of these staff members can supervise is 25.

This supervised family day care is the fastest- growing area of child care today and will no doubt be the largest area of expansion in the future.

2:20 p.m.

As far as day nurseries are concerned, the new regulations will require at least one of the program staff members working with each group of children in a day nursery to have a diploma in early childhood education or the equivalent. The staff in most urban day care centres already have these qualifications. Staff working at centres where they are not met will be given time to upgrade themselves.

A group of children in a day nursery may be comprised of 10 infants, 15 toddlers, 16 preschoolers, 25 five-year-olds or 30 school age children. Only one group of children will be allowed in a room at one time except in the case of preschoolers where up to 24 children aged 30 months to five years will be permitted.

The toddler category, which now includes children from 18 months to 24 months of age, will be expanded to include children up to 30 months of age. This is in keeping with the results of widely accepted research which show that children need intensive adult support during this period to build good language skills as a foundation for learning.

Recent studies have found that both staff-child ratios and group size affect the quality of day care for children under the age of three years. The current staff-to-child ratio for children in the toddler category in Ontario day nurseries is one care giver for every five children. It will remain the same for the extended toddler group, allowing children to benefit from a higher staffing ratio for six more months.

With respect to the other age groups in day nurseries, our revised regulations will set the minimum staff-to-child ratio for children in the preschool category -- 30 months to five years -- at one to eight. It now ranges from one to five in small day care centres to one to nine in large centres. In keeping with current practices, the ratio for five-year-olds will be set at one to 12, and the ratio for children aged six to nine will be set at one to 15.

As I have just indicated, the ratio for toddlers -- age 18 months to 30 months of age -- will be one to five. There will be no change in the staff-to-child ratio for infants up to 18 months of age. It will remain at one to three.

The revisions to the staffing ratios will create a uniform high-quality minimum standard for all centres. By allowing for the redistribution of staff, they will also provide more support for the age groups that need it. The changes are not expected to increase costs substantially and, in fact, the additional cost to my ministry for all of Ontario will be only $60,000 a year. Day care centres with fewer than 45 children will require no increase in staff, and most of the larger centres already employ more staff than required by the existing regulations.

As of December 31, 1982, there were 81,768 children enrolled in 1,877 licensed day nurseries in Ontario. Our annual budget for child care subsidies for parents who qualify is $80 million. In addition to our regular expenditure on day care, the Ministry of Community and Social Services is also providing funds for special child care programs in Ontario. In co-operation with nine municipalities across the province, we have launched a series of employment support initiatives.

For the duration of these pilot projects we will subsidize the cost of child care for more than 3,000 children of sole-support parents on social assistance who are looking for jobs or are in retraining programs. Those parents will be able to choose from a comprehensive range of child care services the form of care most suited to their needs and the needs of their children. Depending on the type of care they choose, my ministry will pay between 80 and 100 per cent of the cost.

These programs are under way in Peterborough, Metropolitan Toronto, Thunder Bay, Ottawa, Waterloo, Windsor, Peel region and the counties of Dufferin and Lanark. The employment support initiatives projects will also provide pre-employment counselling and cover the cost of other employment related expenses such as transportation for sole-support parents.

I will be giving the House an update on the entire general welfare assistance-Family Benefits Act integration program and the employment support initiatives projects in the near future. Both the revisions to the day nurseries standards and the additional child care subsidies we are offering parents on social assistance underline the special responsibility this government has accepted for children and our commitment to provide them with the finest services available.

BUDGET

Hon. F. S. Miller: Mr. Speaker, as I told the House on Friday, the decision we decided to make about the printing of my budget could disrupt our original timetable. I am now pleased to report that a great deal of work over the weekend has put us back on

schedule and I intend to present my budget to the House tomorrow afternoon. I plan to begin the presentation after all the Canadian stock exchanges have closed, or at approximately 4:30 p.m. Toronto time.

We were able to return to our

schedule and begin printing early today through the extraordinary efforts of a great many public servants who have been involved in this project. I have already told the members of my staff in the Ministry of Treasury and Economics how grateful I am for their loyalty and for their dedication and of my admiration for their skills and commitment.

I would also like publicly to express our appreciation to the staff of the translation bureau and the printing services branch of the Ministry of Government Services for the efforts which they are making in very abnormal circumstances. I have spoken to their minister about this and I have asked him to pass on to them my thanks and admiration.

Finally, sir, I must use this opportunity to thank my colleagues in this House, my friends in Muskoka and the hundreds of others throughout Ontario for the support and the understanding they have shown to me in so many ways over the past four or five days. I am very grateful to them.

ORAL QUESTIONS

BUDGETARY PROCESS

Mr. Peterson: Mr. Speaker, I have a question of the Treasurer. Given the recent events, given the events that I am sure the Treasurer will recall with respect to the passing of his last budget a year or so ago when he was called to a committee to explain that budget after the fact, given some of the very serious difficulties Mr. MacEachen had in presenting his budget, which did not conform with some of the realities of the world at that time, and the problems Mr. Lalonde has had recently and about which the Treasurer has commented, and given the fact that, as I am sure he and his Premier (Mr.

Davis) have admitted, it is probably the single most important document this Legislature deals with in the course of a year, and mindful of the words of Gladstone when he said budgets are not merely affairs of arithmetic but in thousands of ways go to the root of prosperity of individuals, the relations of classes and the strengths of kingdoms, will the Treasurer not agree with me now that the time has come for a very serious review of the way in which we draft and prepare our budget?

Will the Treasurer not agree that his government should be thinking of ways to update the budgetary process and bring it into the 20th century?

Hon. F. S. Miller: Mr. Speaker, the suggestion my friend makes cannot be taken as if the budget were standing free and alone within the system of government we function in. One would have to look at the entire system of government. Should a party with a majority form the government? We believe it should. If that is sustained, should that party retain the responsibility for bringing in budgets which are generally acceptable to the public and upon which that government is judged at voting time? We believe it should.

I do not believe the Leader of the Opposition can get to the point he is going to try to get to: i.e., letting his party share in all the benefits of writing a budget whilst accepting none of the responsibility for being on this side of the House.

Mr. Peterson: With great respect, that is not my point. It is not the point of the Canadian Tax Foundation or anyone else who has looked at this very serious issue. Certainly one of the things the Treasurer could do would be to present his taxing options to a standing committee of this House, for example. Ultimately the final selection would be the prerogative of the Treasurer, shrouded in secrecy at that particular time, but at least it would open up this process and avoid, with great respect, some of the difficulties he had in the last budget and that Mr. MacEachen had in his two budgets.

Does the Treasurer not think, given the topicality of this situation at the present time and some of the difficulties that have arisen, that this entire matter of budget reform -- and if he wants to include reform of the entire Legislature, that is his prerogative -- should be referred at least to the standing committee on procedural affairs of this House so we can develop budgets that will better serve the people of this province? Surely that is a reasonable request.

2:30 p.m.

Hon. F. S. Miller: I believe the people have been well served by the system we have in this province, in this country and, in fact, in all those nations that use the parliamentary system of government. I believe the system works very well.

There are times when Treasurers or finance ministers go the route he discusses with good cause. For example, last year I asked the Ontario Economic Council to study whether or not Ontario should stay within the federal-provincial income tax collection agreement. I also put a paper out on the Ontario health insurance plan. Those are for structual changes in the tax system. We do listen when structural change is occurring; we do talk a lot.

On the other hand, one of my options in any budget period is the imposition of three or four per cent more sales tax on a particular item, such as an automobile; or the removal of sales tax from an automobile. If I were to suggest that to him, what would he think that does to a market while we are making up our mind in some committee? If he thinks it does not have a dramatic, immediate effect upon buyers' points of view he is wrong.

Mr. Cooke: Mr. Speaker, I think there is at least one part of the system that could be changed. When the budget is tabled in the Legislature, rather than having to go through the silly process we went through last year of getting the Treasurer to refer one bill to committee, does he not think it would make sense to have a committee of this Legislature examine that budget in detail?

Whether it is called the budget committee or the finance committee, it would be a group to which we could have the budget referred in total, where expert witnesses could be called and we would have the participation of members of this Legislature. Does he not think that would be better than going through what is rather an insular process now, where he could have the experts come in and talk to him? Now he presents the budget and that is the end of it; there is very little opportunity for other members of the Legislature to really benefit and learn from the system, or to participate in debating it.

Hon. F. S. Miller: Mr. Speaker, the same tack is being taken by the member for Windsor-Riverside; that is, that somehow the philosophy of the budget should be up for grabs in a committee. I do not say that is not right in some forms of government or in some types of organization of government; I simply say that in our form of government one cannot change one part of the jigsaw puzzle without looking at all the other responsiblities.

What we do, as he knows, is we refer bills specifically for reviewing the wording of the bills. That is really all that is there unless one wishes to defeat it. In a majority government such as we have the chance of that defeat is not likely; therefore, we generally concentrate our attempts to discuss a bill on the phraseology. I have no problem, as he knows, with better wording of a bill. That is properly the function of both the opposition and our side. He knows the principles of this government require us to stand or fall upon the policy of the bill.

Mr. T. P. Reid: Mr. Speaker, I have always had great admiration for the Treasurer and the fact that he is one of the few who are willing to accept individual responsibility for their actions. But does he not believe something worthwhile came out of the process last year when the retail sales tax bill went to the committee and members of the public, along with members of this House, were able to present their concerns to the Treasurer?

He rightly said: "It is my responsibility and I will stand or hang with it." But he had that opportunity to hear what impact his budgetary measures were actually having on the people of the province. He also had the chance to change those instances which may have adversely affected a lot of people, which the Treasurer and his experts were not aware of. Surely the time spent in that kind of process is well worth while, both for a good budget we all want to see and for the impact it is going to have on the people of the province and the accountibility we all owe them.

Hon. F. S. Miller: Mr. Speaker, my understanding was that it was referred to the committee under the rules of the House and was the choice of the opposition parties under those same rules. They make a decision each time as to whether they want a bill debated in that forum. They have that power, as I understand it. I am not an expert on House rules, but I do not recall being the one who volunteered that measure.

TRUST COMPANIES

Mr. Breithaupt: Mr. Speaker, I have a question of the Minister of Consumer and Commercial Relations concerning the trust companies affair.

In a letter from Mr. Jack Biddell to the minister, dated February 28, 1983, which became public last week, Mr. Biddell wrote: "I came to the conclusion that in this affair we were probably witnessing a 'scam' which, even though it might not prove to be illegal, simply could not be allowed to continue and to escalate."

It is clear from the letter that there was much consultation between Mr. Biddell and the minister. Can the minister indicate, either according to Mr. Biddell or from his own knowledge, how long this apparent scam had been going on within these companies?

Hon. Mr. Elgie: Mr. Speaker, if I may clarify the availability of the Biddell letter, the letter was voluntarily tabled by a counsel last week in the courts and subsequently was the subject of a press release by one of the parties. That clarifies how that letter became public.

The letter revealed that Mr. Biddell, acting as special adviser to the government, had reviewed the information available and had come to the firm opinion that on the one transaction alone, the Cadillac-Fairview transaction, the companies involved had seriously eroded their borrowing bases or had eliminated them completely so that they no longer had the right to take deposits.

Second, as my friend the member for Kitchener has pointed out, he indicated that although there was no positive proof of any illegal activity at that stage, it was his opinion from 40 years of working in this field that in all probability there was a scam. That is what the honourable member is talking about. He then went on to concur with the recommendation that he had put to me with respect to actions the government might take.

Mr. Biddell has been under cross-examination before a special examiner for the past four weeks on the very issues the member is talking about. The exact extent of the information that was available to him is a subject of that transcript and will be available at the appropriate time.

Mr. Breithaupt: Since Mr. Biddell indicated in his letter that the registrar of loan and trust corporations and his staff were one source of his information, does the minister know to what extent the annual examination reports of the registrar's investigators assisted Mr. Biddell in arriving at his conclusion to advise cabinet to seize these companies on January 7?

Hon. Mr. Elgie: As I have said, Mr. Biddell has been under cross-examination for four weeks about the various information and sources that led him to the conclusions he has reached, and whatever his sources were will be information that will be available in those transcripts.

Mr. Cassidy: Mr. Speaker, it is clear that the questionable loans made by Crown Trust were made in a very short period of time shortly after the company was acquired by Mr. Rosenberg. However, it is also clear that questionable loans appear to have been made by Seaway Trust over a lengthy period of time, during which time its capital was increasing, its assets were increasing at an extraordinary rate compared to the rest of the industry and during which time the cabinet itself was mandating the increase in its borrowing base because of the approvals that were given to Seaway Trust.

Can the minister now explain how it is that this government itself could have been so unaware of the kinds of things that were going on in Seaway Trust that they actually approved officially of the kinds of activities they were getting into?

Hon. Mr. Elgie: Mr. Speaker, the issue of the equity participation of Seaway Trust, for example, that the honourable member referred to is a matter we have discussed here before. Clearly, an increase in the amount of capital that individuals have in a business is to the benefit and assurance of the public. I certainly hope the member is not suggesting that this should not have been done in our endeavours to strengthen that company's equity base.

As to the role of the regulators during the course of those few months, I have indicated on many occasions in this House that there is an internal review going on and that there is a Morrison report coming out at the end of this month. I would hope the objectivity of this House would demand that all of this information be seen and put in the proper perspective. If that is not what the member wants, let him say so.

Mr. Martel: Don't be so petulant. You sound like a little boy.

Mr. Swart: Sensitive, aren't you?

Mr. Speaker: Order.

2:40 p.m.

Mr. Breithaupt: I have a final supplementary, not entirely following that last line of comment.

Mr. Speaker: Question, please.

Mr. Breithaupt: Since the minister advised these series of activities on the part of the government were as a result of information and opinion Mr. Biddell gave him, can he indicate, on the basis of any conversations he has had with the registrar, what indication the registrar gave him as to how long this state of affairs had existed in the companies? I ask that because presumably, in the cross-examination of Mr. Biddell about that, that particular information may not be otherwise be available.

Hon. Mr. Elgie: I have responded to this question on other occasions and I can only repeat the answer I gave to the previous member. As the member for Kitchener is well aware, there are a number of judicial actions under way at the present time and this subject matter is part of it.

VISITOR

Mr. Speaker: Just before proceeding, I am advised we have a distinguished visitor in the gallery in the person of the Solicitor General of Canada, the Honourable Robert Kaplan. I ask you to join me in welcoming him.

BUDGET INCENTIVES

Mr. Rae: Mr. Speaker, I have a question for the Premier. It is with regard to some statements he made over the weekend concerning the provincial economy.

In discussing the contents of the budget on Saturday, the Premier said the focus of the budget would be to provide incentives for private industry to create jobs. The Premier said, "We intend to introduce policies and programs that will encourage the creation of jobs in the private sector."

I wonder if the Premier is aware that six Secretaries of Labor in the United States, serving both Democratic and Republican Presidents, have together written a letter to President Reagan saying the approach of focusing only on the private sector is inadequate and will not deal with the immediate crisis in terms of unemployment.

If I may just quote from their letter, which was in yesterday's New York Times, they said: "We agree that the private sector under ideal circumstances should generate such jobs and participate in retraining programs, but this will take time. Until then, government has an obligation to provide relief."

I would like to ask the Premier, does he not recognize that there are hundreds of thousands of people out there who cannot wait for jobs simply to trickle down and who are looking to this government for direct job creation and direct leadership? Can he give us the assurance that he will heed the advice of these gentlemen, who are not particularly of our political persuasion in this party, and recognize that there is a crisis which government has to deal with?

Hon. Mr. Davis: Mr. Speaker, I am always delighted when the leader of the New Democratic Party goes south of the border to seek his economic and political advice. I only wish he would accept it on some other issues. I find it intriguing that the leader of a party totally committed to economic nationalism, cultural nationalism, no more branch plants and, "We do not like the Americans," gets up here and recites to me the view of six former Secretaries of Labor in the United States government. Here is another conversion on the road to Damascus.

I can only say to the honourable member, being as knowledgeable as he is about the differences in the economies of the United States and Canada, where we have always had some greater measure of balance in terms of the public and private sectors, that I would think he really would not seek out the opinions of our American neighbours in relation to the Ontario economy because he, his predecessor and the member for Sudbury East (Mr. Martel) have spent their total careers belabouring me as to why we should accept no economic advice or help from our American friends.

Mr. Rae: I am trying to find language and arguments the Premier will understand. When he had Phil Crane, Alexander Haig and these dinosaurs entertaining members of the Conservative Party in the city of Toronto over the last month, I thought it might be appropriate, given the abjectly colonial nature of the mentality on that side of the House, to try to devise some arguments that would made some sense to them.

Mr. Speaker: Question, please.

Mr. Rae: I would simply like to ask the Premier, again, a direct question. Does he really think the hundreds of thousands of unemployed people in this province can afford to wait for all the job creation measures to come trickling down from the private sector? Does he not recognize that the government of this province has a very real obligation, a contract with the people of this province to provide jobs when the private sector is clearly not providing the jobs that need to be provided for the citizens of this province?

Hon. Mr. Davis: I am delighted the member reads my speeches so carefully. I wish he had been there to listen to me on Saturday, along with the Leader of the Opposition (Mr. Peterson). I gave some friendly advice on how to handle certain political issues of the day. Friday would have been a much happier day if the member had accepted that advice in advance; but that is getting into another area. I only say to the member that if he would read page 8 of my remarks --

Mr. Bradley: You would never have got away with it in Ottawa.

Hon. Mr. Davis: That is why I am here.

Mr. Speaker: Never mind the interjections, please.

Interjections.

Hon. Mr. Davis: I understand --

Mr. Speaker: Will the Premier please address himself to the question? Order.

Hon. Mr. Davis: I will resist the temptation to say to the member for St. Catharines (Mr. Bradley) that his lips move before his brains, but I will get back to the --

Interjections.

Hon. Mr. Davis: Look on page 8.

Interjections.

Mr. Speaker: Order.

Mr. Conway: Let's not be personal now.

Hon. Mr. Davis: I wasn't; I was just stating a fact --

Mr. Conway: We wouldn't want the Tory women to be upset, would we?

Mr. Speaker: Will the Premier please address himself to the question? And will the member for Renfrew North (Mr. Conway) please contain himself?

Hon. Mr. Davis: I gave the honourable member some advice on that matter the other day.

If the member will read the first two lines of the second paragraph on page 8, they will answer his question.

Mr. T. P. Reid: Mr. Speaker, the subtle socialist reminds me more of a punch-drunk fighter who comes out and keeps forgetting to watch the right hand of the Premier on these kinds of issues. We will not go into that, but it is unfortunate that the leader of the New Democratic Party has put it in the context he has, because it is a real problem.

Can we be assured that in regard to those people between the ages of 16 and 24 who are facing poor prospects regardless of the Premier's optimism, there will be matters related entirely and directly to them in this budget to ensure there will not be mere words from the Premier about his optimism but programs to make sure that for the next decade at least there will be jobs created in the private or public sector?

Hon. Mr. Davis: Mr. Speaker, I do not know that I can take it into the next decade --

Mr. Langhren: That's going for the jugular; you really got him there.

Mr. T. P. Reid: I didn't give him a slow curve ball.

Mr. Speaker: Order.

Hon. Mr. Davis: I wonder whether I am at a baseball game or something. I will hit a lob, a curve, whatever the member throws.

Mr. Kerrio: You're a switch-hitter.

Hon. Mr. Davis: Speak for yourself.

Mr. T. P. Reid: You're still talking about baseball.

Hon. Mr. Davis: I say to the member for Rainy River (Mr. T. P. Reid) that we are perhaps talking to somewhat different issues. I expressed the view the other day, and I really believe it, that over the longer period of time for the people we categorize today as being young -- in my humble opinion, anybody of 52 is young, but I know the age group the member is referring to -- there will be without question job opportunities.

As a government, what we are concerned about is the shorter period of time, and I think it will be a relatively short period of time. I can only say to the member that this government does recognize the unemployment difficulties of young people, and I will not comment upon what the budget will contain tomorrow.

Mr. Rae: The truth will be found tomorrow.

Given the speed with which he has dismissed the suggestions that we in our party have made, practical suggestions with respect to job creation in social services, in the environmental sector, in the resource field, in the automobile industry and right through the entire Ontario economy, does the Premier not recognize the very special obligation the government of Ontario has with respect to the need to retrain workers who are being affected by the destruction of jobs in many of our basic industries?

Can the Premier give us a commitment that particular measures will be taken with respect to retraining so we do not have a situation where literally thousands of people are told at age 45, 50 or 55 that they are out the door, that there is nothing there for them and there is nothing anybody can do? Does the Premier not recognize that the government and the public sector have a special obligation to those people?

2:50 p.m.

Hon. Mr. Davis: Now that the discussion has reached this level and we are not quoting experts from south of the border, I think the leader of the New Democratic Party and I might come somewhat closer in terms of our point of view. If he is asking me whether, in my view, retraining amongst various age groups in this province is part of any long-term economic strategy, the answer to that, simply, is "yes."

If he is asking me whether I agree with some of the rather grandiose proposals in the document that two of his colleagues tabled, particularly one relative to the auto industry where part of the solution is to create a crown corporation to get into the auto field, it is not just a matter of theology or philosophy with me: I do not feel any useful purpose will be served in terms of employment opportunities by creating "an Ontario automobile company," by whatever name.

I know it has particular attraction to the member's party but, with respect, I do not see that as a solution. I think the member should sit down and talk quietly to Mr. White and some others, and I know this may provoke them to say publicly, "Yes, it's a great idea," but the fellows I know in the auto business really are not excited about having yet another company, a crown corporation, involved in the production of automobiles.

MASSEY-FERGUSON

Mr. Rae: The Premier will change his tune soon when the task force report comes down.

Mr. Speaker, I would like to address a question to the Minister of Industry and Trade. As one of the trustees for the people of Ontario at Massey-Ferguson, since we now are holders of preferred shares, how does he feel about the fact that the chairman and chief executive officer of Massey-Ferguson received in 1982 an increase in salary of about $160,000, from $395,000 to $554,000, in exactly the same year that Massey was losing $510 million on sales of $2.54 billion?

Hon. Mr. Walker: Mr. Speaker, that is something the Massey-Ferguson people have to resolve themselves. The corporation has a number of shareholders, and the shareholders have to pass judgement on it, as indeed do the board of directors. All I note is a company that was in pretty bad shape just a few years ago seems to be suggesting that this year it might be reaching a break-even point. That is a rather interesting comment. There will have been a rather impressive turnaround in that period of time if that comes about.

I do not think some of the people in Brantford feel quite as disappointed as the honourable member might in terms of the success they seem to be having. Perhaps the member should be congratulating them on the success they are achieving, rather than being somewhat derogatory about some of the other aspects of their operation.

Mr. Rae: So much for the restraint program and so much for a single standard of social justice in Ontario. I am asking the minister directly, as somebody who represents the shareholders in Massey-Ferguson on behalf of the people of Ontario, how he feels about the fact that this is an increase of 40 per cent in compensation in one year, taking this gentleman to well over half a million dollars a year. Does the minister really think that kind of compensation is appropriate when thousands of workers at Massey-Ferguson are losing their jobs, let alone being asked to take a cut in pay?

Hon. Mr. Walker: As a participant, along with the federal government, and as a shareholder of the operation by a law passed by this Legislature and voted on by members of the member's party and those of the Liberal Party, I can tell him the fact that the shares have doubled in the last few weeks is rather impressive from one point of view: the kind of management of this world-wide operation that has substantial employment in Ontario. I keep saying the member should be somewhat more impressed by what they are accomplishing, rather than going around spreading dirt all over the top of them.

Mr. Sweeney: Mr. Speaker, as a shareholder, and given that we have what other members of the minister's party have sometimes referred to as a "window on the industry," exactly what kind of influence can the minister exert on this company on behalf of the government shares, or does he?

Hon. Mr. Walker: Mr. Speaker, we have the rights and obligations of preferred shareholders, which we are.

Mr. Rae: I am sure that puts fear in the hearts of all those who are operating this company.

I would like to ask the minister, as a matter of policy, instead of our having to go to the United States for this kind of information with respect to compensation of executive officers in companies operating in Ontario, is he prepared to change our securities and companies laws to require full publication of information with respect to corporate compensation in Ontario?

Hon. Mr. Walker: Those acts do not fall within this ministry.

ONTARIO VETERINARY COLLEGE

Mr. Worton: Mr. Speaker, in the absence of the Minister of Agriculture and Food (Mr. Timbrell), I would like to ask a question of the Provincial Secretary for Resources Development.

The provincial secretary is aware of the announcement on the weekend that the Ontario Veterinary College has had its accreditation reduced by the American Veterinary Medical Association because of a lack of proper facilities and well-trained instructors. The minister will realize this reduction in accreditation means the college has been put on probation and risks losing its accreditation entirely if it cannot improve its facilities.

This matter has been the subject of discussions and questions asked by the Agriculture and Food critic of the Liberal Party, and back in 1981 the minister assured this House that we would have the best veterinary college in North America and that he planned to keep it that way. In view of those statements, and in the light of what is happening now, what can he tell us?

Hon. Mr. Henderson: Mr. Speaker, let me first clarify that I was not aware of the item in the paper until about half an hour before I entered the House.

Let me take the honourable member back over the period of years. The Minister of Colleges and Universities (Miss Stephenson) has met with the Minister of Agriculture and Food on several occasions to keep the type of credibility we have at the University of Guelph for veterinarians.

As I understand the statement that was made over the weekend, we have no problems for the next five years; we will keep our credibility and we will keep our accreditation. During that period, the Minister of Colleges and Universities and the Minister of Agriculture and Food will be working towards bringing that university and the veterinary school up to a standard that is equal to any place in the world.

Mr. J. A. Reed: That is nonsense.

Mr. Speaker: Order.

Mr. Worton: In the light of that statement, there seems to be a difference of opinion. I have not read the Toronto news, but from what I have read in the local paper there seems to be a difference of opinion from what the minister says.

Interjections.

Mr. Speaker: Order.

Mr. Worton: The minister is aware that the veterinary college in Saskatoon has full accreditation and is in the process of expansion, and that the Ontario Veterinary College still needs another $2 million in operating funds and $9 million as the province's share of the cost of the expansion of the clinic facilities.

I think we can all agree that it has come to a sorry pass when we have a university with such a historic background as that of the OVC and the Ontario Agricultural College and we are putting it in jeopardy. I think we have to get serious about this and do something. Does the minister not agree?

Hon. Mr. Henderson: I recognize the concern of the member. Let me take it a step or two farther.

On Thursday of last week I met the president of the University of Guelph on the east steps here. He is Dr. Forster, as the members know very well.

Interjections.

Mr. Speaker: Order.

Hon. Mr. Henderson: I was also at the funeral of the late William Amos, the clerk of McGillivray township, earlier last Thursday. The head of the veterinary college was one of my colleagues as an honorary pallbearer on that occasion. Again we had an opportunity to speak about this. Let me just assure the honourable member on behalf of this government that that college will be operating over the next five years under its president and that five years from now it will be one of the best veterinary colleges again in North America.

3 p.m.

Mr. Swart: Mr. Speaker, surely the Provincial Secretary for Resources Development must feel it is a sad day in this province when the former agricultural college at Guelph, one that has been known throughout the world, is being reduced to its present status. Would he not think this has come about because of the small amount of its budget that his government puts into agriculture?

Specifically, now that this has come to light, has he made any representation to the Treasurer (Mr. F. S. Miller) so that the government will not reduce the amount being put into agriculture this year by another 13 per cent?

Hon. Mr. Henderson: Mr. Speaker, ordinarily this honourable member does his research and follows through on most of the questions he asks, but it is a sad day when a member who carries this status blames the Minister of Agriculture and Food and does not understand that this university is funded strictly by the ministries of Education and Colleges and Universities. The Minister of Agriculture and Food is there only in an advisory capacity.

STELCO EMISSIONS

Mr. Mackenzie: Mr. Speaker, I have a question of the Minister of Labour. Is the minister aware there is a serious dispute over who is covered at Stelco under the new coke oven emission standards? Is he also aware that some 40 workers in the coal-handling and the byproducts plant -- in the coal-handling plant in some cases the bunkers are right over the coke ovens, and in the byproducts plant only 50 to 60 feet away from the ovens -- have been excluded from the regulations because of the ambiguous nature of subsection 3(1) of the regulations?

Hon. Mr. Ramsay: Yes, Mr. Speaker, I am aware.

Mr. Mackenzie: Can the minister tell us why, on April 21, Ian Carruthers and Vern Tidey of the industrial and occupational health branches supported the company, interpreting the regulations in the company's favour, which is certainly totally opposed to the way we interpret the lead regulations, where everybody exposed to them in the plant is covered? Is he prepared to take another look at the situation?

Hon. Mr. Ramsay: I do not think it is a case of looking into it for the first time. The ministry has been actively engaged in seeking a resolution, and I am sure there will be one in the very near term.

ROLE OF CIVIL SERVANT

Mr. Epp: Mr. Speaker, I have a question for the Minister of Municipal Affairs and Housing. The minister will recall that I wrote to him on April 21 expressing my objections to the alleged impropriety on the part of Milton Farrow, the assistant deputy minister of community planning, and Allan Masson, the chief hearing officer of the Niagara Escarpment Development Control Hearing Office.

The behaviour in question relates to the development of Mariner's Cove in the town of Oakville. The assistant deputy minister's brother, George Farrow, had previously been denied permission to build 14 town houses in Mariner's Cove. However, town council reversed its decision last month after interference on the part of ministry staff.

Has the minister started to investigate the events surrounding the approval of George Farrow's development? If so, what progress has he made? If not, why not and when does he intend to do so?

Hon. Mr. Bennett: Mr. Speaker, first may I say to the honourable member that it has not been my practice to answer to press releases, and that is exactly how I interpret what the member sent out to the press. It was an open letter to the minister. It is not my practice, nor do I intend to make it my practice.

I want to refer to the situation in specific terms, and I want to make it very clear that Mr. Farrow happens to be an assistant deputy minister who is of outstanding quality. There is not a member in this House -- whether it be you, Mr. Speaker, members on the opposite side of the House or members on this side of the House -- who has not approached Mr. Farrow in a very personal way to seek his advice and guidance to help out his constituents.

Although one of the constituents in Oakville happens to be Mr. Farrow's brother, I would think he has the same privilege of asking that brother for some advice as to how he processes an application through the mill. The final analysis -- let us put it very clearly -- is the decision of a municipal council to take the vote and stand on it one way or the other in relationship to whatever the application might refer to.

Indeed, I recognize that Mr. Farrow's brother had submitted an application a year or so ago that had not won the approval of the council. He resubmitted his application, which is not out of the ordinary in this province; there are many who resubmit applications under different terminology to seek further advice and approval if they can get it from the council. He did so, and the council in this particular case supported his application. I see no reason to review the situation any further.

Mr. Epp: Need I remind the minister that George Farrow's comment to Oakville council on April 18 was, and I quote -- and this is on tape so there is no question about it: "You know who my brother is. He is not the one who answered the letter but he can sure make it move when we want an answer." That was George Farrow's comment to Oakville council.

George Farrow also quoted statements made by one of his brother's subordinates, namely the manager of the ministry's community planning review branch, John Livey. According to the developer, Livey stated that the project was consistent with Oakville's official plan and spoke favourably of his boss's brother's development proposal.

As for Mr. Masson. it is completely inappropriate for any hearing officer, whether associated with the Ontario Municipal Board, the Niagara Escarpment Development Control Board or the land titles branch of the Ministry of Consumer and Commercial Relations, to appear before a town council in an unofficial capacity to help the assistant deputy minister's brother get his development proposal approved.

Does the minister condone this sort of behaviour; and what message is conveyed to other senior officials, given the minister's refusal to clear the air with respect to this suggestion of a flagrant abuse of power? Finally, if the minister is not prepared to deal with the improper actions of his staff, will he at least take the appropriate steps to prevent the damage to Mariner's Cove that their interference is about to cause?

Hon. Mr. Bennett: First let us review exactly what did take place. The member wants to say what Mr. Farrow's brother replied in the Oakville council, which is correct; but one should ask oneself, what was the question which was asked. The question was asked by the councillor who opposed the plan as to who Mr. Farrow might know in the ministry.

Everyone in that council was very well aware that Mr. Farrow was the brother of an assistant deputy minister in the Ministry of Municipal Affairs and Housing in the province. So he repeated very clearly and distinctly that his brother was Milt Farrow, which all in that council happened to know. That is what is on the record.

One should take into account what the question happened to be before the response. I have looked at the situation and had some discussions with people in my ministry relating to it. Mr. Farrow did seek some advice and guidance from the ministry, as any other taxpayer would be entitled to do so. The assistant deputy minister Mr. Farrow did not himself get into the discussion with his brother, but did refer him to others within the ministry who could give him the advice or guidance that he would seek, to which any other taxpayer in this province would be entitled. I see nothing out of line in relationship to this action.

Mr. Breaugh: Mr. Speaker, I would like to ask the minister a simple question. Does he not think it is wrong for a developer to appear before a council and clearly to imply that he knows people in places of power who will expedite this project? Is that not wrong, morally and otherwise? What has the minister done to correct the situation?

Hon. Mr. Bennett: Mr. Speaker, in direct answer to that question, I suppose if the member who asked the question happened to have a brother, and he was making an application, would he deny that he was his brother? Would he deny it? That is the very situation that we are confronted with. Indeed, I would hope he would not deny his brother.

Both are very fine individuals in this province and serve their community extremely well. Mr. Farrow in the ministry has --

Interjections.

Mr. Speaker: Order. Would the minister please address the person who asked the question?

3:10 p.m.

Hon. Mr. Bennett: I hope we are not in a situation here of trying to reduce in any way the effectiveness of one Mr. Milt Farrow to this government and the people of this province. I believe the actions that were taken were appropriate. When the gentleman was asked who he happened to know in the Ministry of Municipal Affairs and Housing, he answered straightforwardly and clearly that his brother Milton Farrow happened to be an assistant deputy minister.

I see nothing wrong with that. Indeed, I would not expect the architect, Mr. Farrow, to deny that his brother works for the ministry. He is proud of what his brother has been able to do in this province, and indeed we should be happy for his service to this government.

UNEMPLOYMENT

Mr. Cooke: Mr. Speaker, I have a question of the Treasurer. He will be aware the unemployment statistics announced Friday showed Ontario, contrary to the nationwide trend, had an increase in unemployment from 519,000 people to 532,000, or 11.7 per cent. He will also be aware the statistics on closures and layoffs in the province show a dramatic increase for January and February, an increase of 31 per cent over all.

Is the Treasurer now prepared to admit the recovery he so often talks about is not a real recovery? It is not a recovery that will see the people of Ontario going back to work. Is he now willing to accept that the public sector has a major role to play in order to create jobs in this province?

Whether it be through municipal capital works, through the construction of nonprofit nursing homes, through the forestry sector or in housing, will he not admit the public sector has a major role to play to create those jobs? This would be in the short run, but at the same time does it not have a role to play in constructing things that will be of long-lasting benefit to all the people of Ontario?

Hon. F. S. Miller: Mr. Speaker, I guess Friday morning I was not spending as much time looking at the unemployment and employment figures as I normally would have when they came out. I have them in front of me. The actual figures in Ontario in that month showed an increase in employment of 13,000 jobs and a decrease in unemployment of 18,000. The member will go down to the seasonally adjusted base, I am sure, because they suit him better. The fact remains that 13,000 more people were at work and 18,000 fewer people actually were not employed at that point.

When it comes to the question of how one creates jobs, I will never bridge the gap that exists between my colleague and me. However, unlike him I do not feel there is only one way to solve the problem. I hope when he sees my budget tomorrow he will be satisfied we have taken the multi-pronged approach to a problem.

Mr. Mackenzie: Mr. Speaker, will the Treasurer take a look at the actions of some of the plants in the Hamilton area that have shut down? They are one of the reasons for the increase in permanent closures between February 1982 and February 1983 and there has been, to say the least, less than good corporate responsibility -- whether it was Flavorite Poultry or Consolidated-Bathurst or Allen Industries. At least would he take a look at some justification procedures before closures take place in Ontario that do affect large numbers of workers?

Hon. F. S. Miller: I am not going to get into the issue of corporate responsibility again. That is a matter that one may evidence some bias about from time to time. The lists I get that show me the number of recalls, which the honourable member tends to forget about, show a net improvement. He only wants to talk about the negatives in life. I suggest to him that on balance the recovery we have been talking about is under way. If he is really interested in the people he purports to serve, he should evidence some of that confidence on their behalf too.

Mr. Wrye: Mr. Speaker, I will accept the Treasurer's argument for the moment that there may have been some mild numerical improvement, very modest none the less. He will know the areas that are resisting that movement are those that have been hit with structural unemployment. In some cities, such as my own and places such as Chatham and Sudbury, this is now into the third year and beyond. Can the Treasurer give us a commitment that his budget tomorrow will contain measures that will not only help alleviate unemployment across the province in general but will, for the first time, have this government targeting specifically toward those communities with long-term unemployment?

Hon. F. S. Miller: Mr. Speaker, again, the member will have to wait until tomorrow. He knows the Premier (Mr. Davis) has been quoted in the newspapers as saying there are measures in the budget to stimulate employment. I am reasonably sure if I showed them all to the member at this point, if I described them all carefully and patiently to him, he would still tell me they were not good enough or soon enough or effective enough.

UNEMPLOYMENT IN TOURISM INDUSTRY

Mr. Eakins: Mr. Speaker, my question is to the Treasurer. Given that the revenues of our provincial tourism sector for the latest fiscal year are much lower than his expectations, and given the importance of this sector in terms of employment -- 541,000 Ontarians and provincial tax dollars totalling more than $1 billion -- is it fair to ask the Treasurer at this time if he has given consideration to some of the recommendations presented to him by groups, such as Tourism Ontario, in their attempt to improve the state of our tourism industry?

They recommend methods such as the adjustment of provincial sales tax on prepared meals, accommodation and beverage alcohol in licensed establishments to a straight five per cent.

Hon. F. S. Miller: Mr. Speaker, the member knows I cannot answer that question. Of course I give careful consideration each year. I might suggest that particular industry thinks this Treasurer has been its supporter.

Mr. Eakins: How about the restaurants?

Hon. F. S. Miller: Their business is up 20 per cent in a year.

It so happens that when he talks about the catastrophic year I do not know if it was. Was Haliburton in trouble last year? Was the tourist business worse than in the previous year? Muskoka was not; Muskoka had the best summer season it ever had.

Mr. Kerrio: Mr. Speaker, would the minister not consider the problem of most jurisdictions that are close to the border, of having those people who visit us stay here? I wonder if the minister would take it under advisement to encourage people to stay, by talking to people such as some we have in Niagara who do as much advertising as, sometimes more than, the ministry itself?

Could the minister not do something that would help the balance of trade, because a good deal of that money certainly helps that balance'? Is he going to do something that would encourage those people who come to stay when they visit us?

Hon. F. S. Miller: Mr. Speaker, I guess my attitude is that that is the part that interests me most. The member is right on the border. They can get over to his city and back in minutes. Perhaps the fact is that the member sends them back; I do not know. It seems to me when they get to Muskoka, they stay.

Mr. Kerrio: They can't get away.

Hon. F. S. Miller: That is right. They usually do not have enough money to get home.

Besides that fact, they do have very localized American problems. He is close to one of the American cities that has also suffered heavily from unemployment.

After 23 or 24 years in the summer tourist business, we see a great difference in the advance bookings from the United States from year to year, depending upon the overall level of employment, particularly from the Buffalo area, which is still close to our best area for central Ontario. I am told that has been a weak area this year, that the bookings from Buffalo are down this year for the coming season. I can also tell the member, my colleagues in the business in Muskoka report bookings from other parts of Canada are up. I hope that is true.

FOREIGN STUDENT FEES

Mr. Allen: Mr. Speaker, I have a question for the Minister of Colleges and Universities. May I take the opportunity to welcome her back to the House. We all trust she is well recovered and ready for battle in her usual style. The questions have been piling up in her absence.

Mr. Minister --

Hon. Miss Stephenson: That's not the way to start.

lnterjections.

Mr. Allen: I will not make any remarks on that slip.

The minister is aware of the growing uneasiness in Ontario universities among students, professors and administrators, on the subject of visa student fees. Given the extent to which Canadian, and Ontario universities in particular, have been enriched by university systems overseas in the past, and given that two recent studies, one British and one Canadian, on the effects of differential visa student fees have concluded there is no overall benefit in their application and much that is adverse, will the minister commit her ministry to a complete review of provincial policy towards foreign student fees, it is hoped with a view to their complete abolition?

3:20 p.m.

Hon. Miss Stephenson: Mr. Speaker, first, I would like to thank the members of the House. It is nice to know I was missed. I did not believe I was except by my favourite combatants, the members for St. Catharines (Mr. Bradley) and Oakwood (Mr. Grande).

None the less, I am delighted to be able to respond to the question of the member for Hamilton West and to state clearly that the matter of the differential visa student fee for graduate students has been under review for the past several months. We are awaiting further input from the Ontario Graduate Association, input which was promised us several months ago but has not yet arrived. I am sure it will arrive in due course.

The specific concerns related to those graduate students found a good deal of sympathy within the ministry. We determined it would be well to delay any further implementation of the program announced in February 1982, in both its phases; and for all the universities, all the students and all the faculty in Ontario to understand clearly and to transmit to students who were enrolling from offshore, that that part of the program for graduate students would be put in abeyance until that monitoring was completed.

We are equally as concerned as the member about the contribution foreign students make to our students' educational experience. We have always been concerned about the contribution foreign universities have made to the development of intellectual capital in Ontario. We have not forgotten that and we have made every effort to ensure our responsibilities in terms of foreign students, specifically in areas where the students were from developing countries, were totally met by this government and the people of Ontario and Canada. We shall continue to do that.

To suggest we will immediately change the project which was announced on February 18, 1982, would be foolhardy. To suggest we will be watching it carefully would be a very wise decision to make.

Mr. Allen: In the light of the fact foreign student registrations in the first year of university programs dropped last fall by something like 4,200 students, from 7,000 to 2,800, and in that some $5,000 is spent by each student --

Hon. Miss Stephenson: What?

Mr. Allen: Sorry. Did I give a wrong figure? It is a drop in first-year programs from 7,000 to 2,700, a drop of 4,300.

Given that figure, and given that each student brings approximately $5,000 to the local economy where he comes to reside, meaning in that simple statistic we have suffered a loss of about $20 million in one year, would it not be wise for the minister to hold current student fees at their present level rather than increasing them at all next year, in order to continue to attract foreign students and their input into local economies pending the completion of the departmental review?

Hon. Miss Stephenson: The figures the honourable member uses are ones I have not heard before in terms of a total number of reductions. They are figures he must have acquired from some source to which I am not privy. The figures I have seen would demonstrate there has been a small but significant reduction in first-year enrolment of students in Ontario universities, and that is a matter which we will continue to monitor.

The position has been taken. It was announced in February 1982. I remind the member that is now 16 months ago. It was announced sufficiently clearly so everyone would be fully aware of the fact the two-phase program was to be in place. It will be in place. I believe some of the institutions are making some changes in their own circumstances, since I gather they have announced that they failed to notify their applying students of the circumstances.

BORG-WARNER

Mr. Wrye: Mr. Speaker, I have a question for the Minister of Labour concerning the Employment Standards Act as it pertains to Borg-Warner, a manufacturing plant in Oakville. I am sure the minister is aware that this plant used to manufacture car radiators for Chrysler and that in July 1981 the employer effectively laid off more than 50 of the employees, advising them their services were no longer needed. The company then dismantled and sold most of its machinery required in the production of the radiators and so it has no capability at present of producing those radiators.

The employees, therefore, are certain -- and I am sure the minister's employment standards people are aware -- there has been a permanent discontinuance of all or part of the business of the employer in accordance with the act. The employer alleges that because it is prepared, at any time, to bid on a potential car radiator contract, there has been no permanent discontinuance. Since July 1981, approaching two years, the employees have been waiting for their severance entitlement.

The ministry has been aware of this case now for over one year and refuses to make a ruling on whether the seemingly irrevocable closing-off of this company from the production of car radiators adds up to a permanent discontinuance.

Why is his ministry reluctant to arrive at the obvious conclusion that there has been a permanent discontinuance? How long must the employees wait? Does the minister not think it is time we looked at the phrasing of the term "permanent discontinuance" as it applies to the act?

Hon. Mr. Ramsay: Mr. Speaker, I am aware of the circumstances that have been described by my friend opposite. I must admit I am not immediately up to date on the present circumstances, but will make myself so and will report back to him either by letter or in this House.

MOTION

COMMITTEE SUBSTITUTIONS

Hon. Mr. Wells moved that the following substitutions be made: on the standing committee on general government, Mr. Cooke for Mr. Charlton; on the standing committee on members' services, Mr. Charlton for Mr. Cassidy; on the standing committee on procedural affairs, Mr. Cassidy for Mr. Charlton; on the select committee on the Ombudsman, Mr. Philip for Mr. Cooke.

Motion agreed to.

INTRODUCTION OF BILLS

STAR OF PROGRESS SPIRITUAL CHURCH ACT

Ms. Fish moved, seconded by Mr. Cousens, first reading of Bill Pr23,

An Act to revive the Star of Progress Spiritual Church.

Motion agreed to.

LABOUR RELATIONS AMENDMENT ACT

Mr. Haggerty moved, seconded by Mr. Epp, first reading of Bill 31,

An Act to amend the Labour Relations Act.

Motion agreed to.

3:30 p.m.

Mr. Haggerty: Mr. Speaker, the purpose of the bill is to provide a mechanism whereby the Lieutenant Governor in Council can order a 60-day suspension of the strike or lockout and order a return to work where the strike or lockout constitutes an immediate and serious danger to life, health and safety or seriously disrupts the economy of the province or of any area of the province.

The bill provides that the Minister of Labour must appoint a conciliation officer where an order suspending a strike or lockout has been made, and may subsequently appoint a conciliation board where the efforts of the conciliation officer to effect a collective agreement are unsuccessful.

If conciliation efforts are unsuccessful, the strike or lockout may be resumed without a further strike vote. An order made under the bill would be enforceable as an order of the Supreme Court.

RESPONSE TO WRITTEN QUESTIONS

Mr. McClellan: Mr. Speaker, before the orders of the day I would like to bring to the attention of the government House leader (Mr. Wells) the numerous violations of standing order 81(

d) with respect to replying to written questions in Orders and Notices within 14 days. This having been brought to his attention, I trust it will be remedied, tomorrow.

Mr. Speaker: I am sure the government House leader will take note.

MOTION TO SET ASIDE ORDINARY BUSINESS

Mr. Rae moved, seconded by Mr. Foulds, that pursuant to standing order 34(a), the ordinary business of the House be set aside to debate a matter of urgent public importance, namely the unprecedented publication of apparent budget information several days before the official release date of the budget, the absence of a complete explanation as to how such a fundamental breakdown of security could have occurred and the ministerial responsibility and accountability of the Treasurer for such publication; and that this entire matter be referred to the standing committee on procedural affairs.

Mr. Speaker: I would like to advise the honourable members before we start any discussion that the motion has been received in time, and I will listen to the honourable member for up to five minutes as to why he thinks the ordinary business of the House should be set aside.

Mr. Rae: Mr. Speaker, I do not think there can be any question that the events that came to our attention on Thursday evening and Thursday night, which we had a chance to discuss in the Legislature on Friday, are matters of urgent public importance. There can be no question that what took place -- that is to say, the publication in the Globe and Mail of information that allegedly pertains to the budget that will be announced tomorrow by the Treasurer (Mr. F. S. Miller) -- amounts to an urgent situation.

I think it is important for us not to overreact, but I think it is also important for us to put it in the context of a number of issues that have come to be accepted as basic traditions in this Legislature.

I do not want to enter into a debate again today on the question of the responsibility or otherwise of the Treasurer for what has taken place. The Treasurer has made his decision to go ahead with the budget tomorrow. I think we have to wait until tomorrow to see precisely what is contained in the budget and to see what steps then need to be taken.

Quite apart from this and quite apart from the discussions we had on Friday in this House with respect to the responsibility of the Treasurer, I do think there are matters here that are quite different from the question of privilege that you considered on Friday.

I respect the ruling you made this afternoon, Mr. Speaker, and I think the matter we are asking to debate today is significantly different from the one we discussed on Friday. The discussion on Friday, as I am sure you will realize and remember, focused principally on the question of what the Treasurer knew, how he knew it and what he felt his responsibility was for the events as they took place. The substance of the motion I am putting before you is that this matter is of sufficient importance that it should be referred to the standing committee on procedural affairs.

We have operated on certain basic assumptions in this assembly, as have other legislatures that follow in the British parliamentary tradition, and I would say there are two key elements in that tradition with respect to the publication of budget information. The first is that budget information has to be kept secret and a leak or a release of that information prior to the publication of a budget in itself is cause for very real concern.

The second principle which has informed my understanding of the Constitution of Ontario and of our country, and which I think has informed the understanding of most people of the meaning of the parliamentary tradition, is that a minister is responsible and accountable to the Legislature not only for his own conduct or misconduct but also for the conduct or misconduct of his ministry.

With respect to budget secrecy, the arguments which we put forward on Friday were basically arguments, if you like, of strict liability. They were arguments which said that, however it may have been caused, a Treasurer was ultimately responsible for the release of budgetary information and that in the light of that practice of strict liability he had an obligation to offer his resignation once that information had been made public.

I do not pretend to have any monopoly on the answers to these questions. We were operating, and indeed are operating, on the assumption that certain rules have been in place and are there to be respected and that we are living in a society where majorities cannot simply change the rules willy-nilly in order to suit their understanding of the laws and traditions of our country and of our province.

That is why I would ask you, sir, in considering this motion, to consider that we are asking that it be referred to the standing committee on procedural affairs and that the standing committee itself would be bound to do two things, as we understand it: to examine what is going on, what are the facts of the situation; and also to deal with the question of ministerial responsibility and accountability for the breach that may or may not have occurred.

We are entitled to an answer to those two questions. They can be answered only by a reasoned and considered approach by a standing committee of this Legislature which includes representatives of all three parties. Rules cannot be changed by the will of the majority, but have to be changed by the will of all the members of this Legislature.

Mr. Conway: Mr. Speaker, I rise on behalf of my colleagues to support the intent of the resolution standing in the name of the member for York South. I do so, having before me your ruling of earlier this afternoon, where in three pages you indicate to us that you do not imagine this to be a matter of privilege.

I have, of course, little or no choice but to accept that decision and I do so. However, accepting the ruling that this is not a matter of privilege, let me say that like, among others, the editorial board of the St. Catharines Standard of May 6, 1983, like the editorial writer of that newspaper, I see the matter to be none the less a matter of honour and principle.

It is, of course, a very important and serious matter for this Legislative Assembly, made more serious and more important because no less an honorable member than the Treasurer has set the standard for public morality vis-à-vis the handling of these matters. It has been referred to, on a number of occasions, that the Treasurer of Ontario has in recent days set the standard for public morality in this kind of situation.

I found it interesting that the Treasurer earlier today decided to lecture this House on some of the important questions to which this resolution directs our attention. In his response today, the Treasurer, responding to the Leader of the Opposition (Mr. Peterson), who was asking for a lifting up of the budgetary process, drew our attention to some of the cornerstones of British parliamentary democracy. He drew our attention to the principle of responsible government, that time-honoured tradition which sees an executive council discharging executive functions and ultimately being responsible to a Legislative Assembly.

3:40 p.m.

That, of course, is the principal cornerstone of our parliamentary democracy. But the essential component of that British parliamentary tradition, as MacGregor Dawson and others have pointed out, is that turning on ministerial responsibility. It is a rigid and sometimes a harsh doctrine. It is a doctrine that is often relied upon by this government when it seeks to put off such reformist principles as freedom of information.

How many times have we in this assembly heard from ministers of the crown that they cannot open up the operations of government because that would dilute and compromise that principle known as ministerial responsibility? It has not been lost on me how, in this situation, so many in the current executive council are so willing and anxious to talk around the principle of ministerial responsibility.

However unfair, however harsh and however rigid is that doctrine, certainly my

interpretation of the duty of the Treasurer is clear in this matter. Perhaps we will not be able to adjudicate finally until tomorrow afternoon at four o'clock, but my colleagues and I think it important that this Legislature deal with this matter in the standing committee on procedural affairs, as the resolution of the member for York South suggests.

We are struck by the role of the press in all of this. I wonder, thinking aloud, about the exact circumstances surrounding the leak at the Carswell Printing Co. Did a reporter randomly, on the first visit in the trash alley of the Carswell establishment in Don Mills, happen upon some not too well shredded galley proofs? Or was it a matter of an inside tip?

One can just imagine the volume of garbage a printing house generates. My office is not far from the Progressive Conservative Party and the Liberal Party printshop downstairs. What goes out of there daily is, to say the least, voluminous. I really wonder whether what happened at Don Mills last week was a random visitation or was there an inside tipoff.

This is a question this Legislature might look into. Perhaps it should constitute part of the inquiry of the Solicitor General (Mr. G. W. Taylor). These are questions which direct our attention to the fundamentals of the way in which we do our business here. I certainly hope the Legislature this afternoon could give individual members an opportunity to ventilate their views on a matter of urgent and pressing necessity.

Hon. Mr. Wells: Mr. Speaker, we in the government have no objection to proceeding with this debate this afternoon. We feel that much of what could have been carried on in this debate was entered into by this House by the question of privilege raised on Friday. We had a fairly wide-ranging debate on this matter then, but we would be most happy to hear all members' opinions on this motion. Therefore we would have no objection if you will, Mr. Speaker, that this emergency debate proceed.

Mr. Speaker: To address myself to the honourable government House leader, it is not my responsibility to rule that the debate will or will not proceed. My responsibility is either to find the motion in order or not in order. I do so find that the motion is in order. I put the question to the House: Shall the debate proceed?

Motion agreed to.

BUDGET SECURITY

Mr. Cooke: Mr. Speaker, this is the first opportunity I have had to speak with those silly clocks working to figure out whether I have done 10 minutes or not. I am glad to have the opportunity to participate in the debate. I am not sure I will take the full 10 minutes but I do want to raise a few of my views on this matter.

This whole matter of a budget leak gets down to one of the most basic aspects of the parliamentary system, and that is the aspect of ministerial responsibility. We understand the sketchy details that have now been released about the budget leak, as to how it happened, but there are still some very relevant questions in terms of what would have happened if someone else had gained access to this information, if there is any other information floating around or if the information was any kind of a setup. I assume that is what the Ontario Provincial Police are looking at.

I think a standing committee of the Legislature that would examine this matter should not only look at what happened with this leak and how it came about, but it is time the Legislature examined the role of all members of provincial parliament, all members of this assembly, in the budget process to see how that accountability can be increased and how more members can participate.

I do find some aspects of what has happened in the last few days rather alarming. For example, when the Treasurer (Mr. F. S. Miller) first became aware that there had been a leak and that the Globe and Mail did, in fact, have some information that appeared to be part of tomorrow's budget, I think it was incumbent on him to come into the Legislature last Thursday evening to report to all members of the assembly that this had occurred.

Why he chose instead to speak with the press, why he decided to go on Metro Morning the next morning before speaking to the members of the Legislature, why he played that kind of a game with such an important violation of an accepted parliamentary procedure, demonstrates a lot of things that have gone wrong in the Ontario Legislature since I have been a member.

I remember last year when we had the budget response the lack of respect the provincial Treasurer, the Premier (Mr. Davis) and the government itself showed for the Legislature. They held this place in contempt when we had perhaps two or three members, back-benchers of the Conservative Party, present for the response of the member for Rainy River (Mr. T. P. Reid) to the budget. That also occurs on throne speech debate responses from the opposition leaders, and it demonstrates very clearly that the government has lost respect for the Legislature and lost respect for the process. The only time they try to rekindle that respect in the process is when it suits them.

In this case, it suits the government to say this is not really a violation of parliamentary procedure and ministerial responsibility, that it is an outdated principle in any case and therefore it need not be respected. I became most upset with this whole incident when I read in today's Globe and Mail and yesterday's Toronto Star comments that the Premier decided to make to the Progressive Conservative women's group.

I want to quote from today's Globe. "In a scathing attack on the Liberals and NDP, Mr. Davis told about 150 members of the Progressive Conservative Association of Women that 'we must not allow ourselves to descend to the kind of total inconsistency and hypocrisy practised by the opposition at Queen's Park.'" He refers to us on this side acting in a hypocritical way when it was that government, whether it be the Premier or in this case the Treasurer, who took off the gloves the night of the federal budget and accused the federal government of violating parliamentary procedure when Mr.

Lalonde decided he should not resign. It was the Treasurer who carried that to the extreme when he decided to have his photo session with his budget and mocked Mr. Lalonde even further by putting a comic magazine inside the budget cover.

I suggest anything that comes out of this budget leak, any of the embarrassment that has been placed on this government, has been increased by the Treasurer and his own tactics when it came to the rather stupid leak that occurred in Ottawa just a couple of weeks before. The Treasurer has set the tone for this debate. He has set the tone of the whole debate on the budget leak by how he responded to Mr. Lalonde and the leak that occurred in Ottawa.

That is one of the reasons I have absolutely no sympathy with the provincial Treasurer for what has occurred. The responsibility, the practice and the principle of parliamentary procedures and ministerial responsibility are as relevant today in Tory Ontario as they were 10 years ago, or as they were two weeks ago in Ottawa when Mr. Lalonde showed his budget to Hamilton's channel 11 cameras.

3:50 p.m.

I would suggest that this does, however, give all of us the opportunity to participate in the debate and to take a closer look at the budgetary process in this province. I think it is time that we refer the matter to the procedural affairs committee of the Legislature, as suggested in this resolution, to take a look and see whether the system can be modernized.

I do not think the Treasurer should use this as a way out in this particular situation, but I do think it is something that members should examine to see if a system can be developed in which more members can participate; a system in which the entire budget, after it is tabled and read into the legislative record and responded to by the official critics, can then be debated by a committee of the Legislature with expert testimony.

Perhaps at that point a government would even be willing to accept some changes in the budget if the testimony indicated that it was reasonable to do so. In this way, all members of the Legislature would have the benefit of the experts who reside in our province, on both the business and the labour side as well as individual people, and we would all be able to act in a more responsible way when it came to budgetary matters both in estimates and, more particularly, in tax measures and economic strategy.

I have a couple of other points. One is that last week the government House leader made the point that this budget leak was not particularly relevant because it did not involve a tax measure. I think the government should realize -- I know the Treasurer did back in 1979 -- that the Ontario health insurance plan premiums in this province are in fact tax measures. They raise more revenue than corporate income tax, and that fact was recognized in 1979 by the member for Muskoka in response to questions in this Legislature, in which he referred to it as a tax measure.

I think the principle of ministerial responsibility is the most important aspect of this whole debate. If there is no acceptance of ministerial responsibility, whether it be with the Solicitor General (Mr. G. W. Taylor), the Treasurer or both, then there is something very seriously wrong with the system.

The security measures in this particular case did not work; that is obvious. I think the responsibility for the security measures certainly resides with both the Solicitor General and the Treasurer. This is something that cannot be sidestepped by this government.

We have to get an appropriate response, and I hope if the Treasurer joins the debate this afternoon he will also respond to those of us in the Legislature who feel rather offended. He was not here when I made these comments, so I will repeat them. We feel rather offended on two counts: first, that he did not have the courtesy or the respect for the Legislative Assembly to come in and talk about this matter or report to the Legislature last Thursday evening when he first knew about it; and second, on the whole aspect of his comments about Mr. Lalonde just a couple of weeks before.

Perhaps he can refresh the memories of all members of the Legislature about the comments he made in Leamington the night the federal budget came down: the comments about getting Mr. Lalonde off the hook for $200 million on the budget leak. Those comments were made publicly, and the Treasurer has to accept that if he thinks Mr. Lalonde should resign, as was the case just a couple of weeks ago, then where does he stand on this matter? Where does he define exactly what ministerial responsibility means in this case?

I think a lot of these matters can be explored and defined for the future by a committee of this Legislature. If we can separate ourselves from the leak that occurred last week, I think a committee of the Legislature can look at this whole matter in a fairly nonpartisan way, and I think something good can come out of what was a very embarrassing situation for the government on Thursday last.

Mr. Conway: Mr. Speaker, I would first like to acknowledge with thanks the attendance of the Treasurer at the debate. Unlike the member for Windsor-Riverside (Mr. Cooke), I do have as one member to another a sense of sympathy for the Treasurer. I have not had the privilege of serving on the executive council but I hope there is not a member here, or I hope there are not too many members here, who cannot feel deeply and personally for one of our colleagues who finds himself in this situation. It has to be difficult. It must be an extremely personal and difficult experience the Treasurer has gone through these past 72 hours.

Without malice and without prejudice I say to the Treasurer that, accepting the Speaker's ruling this is not a matter of privilege, it remains a matter of honour and a matter of principle.

However difficult, the Treasurer's duty as a minister of the crown is clear, in my reading of the British parliamentary tradition. When a minister of the crown is unable, for whatever reason, to discharge his extremely important executive responsibilities in conformity with his oath, the details of the circumstances surrounding his incapacity in that respect do not, it seems to me, make much difference in the final analysis. They might in a secondary way help to explain certain things, but the doctrine of ministerial responsibility has been tough and it has been rigid.

When a Treasurer, a Minister of Finance or a Chancellor of the Exchequer, for whatever reason, is not able to protect or guarantee the secrecy of his or her budget, I believe we have a clear case of a minister's responsibility not having been lived up to. I think the time-honoured tradition leads to only one honourable course.

Perhaps like other members, I would not feel as strongly about this as I do if the Treasurer of Ontario had not in recent days himself set the standard for public morality in this regard. The Treasurer, for whatever reason, was quick off the mark days ago in tendering gratuitous advice to the Minister of Finance for Canada as to what his obligation was with respect to the so-called leak that occurred, I believe, on April 17 or 18, a day or two before the Minister of Finance tendered his budget in the House of Commons.

Let me say further I do not share with others the belief that the situations in Ottawa and Toronto are as dissimilar as others would have us believe. I think the Minister of Finance for Canada might have reasonably expected that when the press came to his office for the customary photo opportunity they would have respected the conventions of budget secrecy and would not zoom in and try to get an early glimpse of the budget and, having received it through whatever technological process, then transmit it to the public at large. But they did so.

Of course the Treasurer, having knowledge of that situation, had his photo opportunity. For whatever good reason, and I can imagine a few, he joked with the press by opening a copy of what I remember to be the 1983 budget with Scary Tales inside.

Hon. F. S. Miller: It was not a budget.

Mr. Conway: He shakes his head. He says it was not a 1983 budget. It was not a budget. Well, he opened what looked like a budget to those of us who saw it reported in the press and, of course, showed Scary Tales.

I say to the Treasurer he has responsibilities. He had to believe that, given what occurred in Ottawa, there might be some effort to breach the security which took the budget outside of his immediate control in the Frost Building. The press, in a very particular way, sought to inquire after the health of the Ontario budget and, as we found out last Thursday, was able to piece together galley proofs of same.

4 p.m.

In my earlier remarks I said that some of us, and I will speak personally, have to believe, given what the press received in the back alleys of Don Mills when it went looking for the scraps of paper that one would normally find in the garbage collection, that it is almost unreasonable to believe that they were able to go up there and, helter-skelter or at random, find the unshredded galley proofs that provided the basis for their story.

I have some grave suspicions about a tipoff from the inside. If in fact there is reason to believe there was a tipoff, that there was some measure of insider information, I have to think to myself what possible opportunity was there for other interested parties to take advantage of that situation?

Tomorrow, at four o'clock, the Treasurer is going to introduce in this place a budget which in some respects has been leaked. We will not know for sure until that time tomorrow afternoon when the Treasurer rises in his place to read the budgetary policy of this government for 1983-84.

But it bothers me more than a little bit to think that the Treasurer is proceeding with a budget that has been leaked in some measure, that he told us on Friday he could not guarantee he had contained or controlled all of that leaked information, and that tomorrow we are still going to get a budget that has been prepared and delivered under those kinds of conditions. I am worried about the extent to which the secrecy has been provided for and guaranteed.

I want to say something about the role of the press in this respect. I read the Toronto Globe and Mail editorial this morning. I find I am almost incapable of talking reasonably about that. I really wonder what the chief magistrate of this great Upper Canada of ours thinks about the consistency of the national newspaper.

I suppose, if nothing else, it tells us the editorial writers at the Toronto Globe and Mail continue as always to be scrupulously even handed in the way in which they opine in terms of federal and provincial policies.

I would never in this assembly stoop to the use of the word "hypocrisy." I could not bring myself to use the word "hypocrisy" in this place because, of course, as Beauchesne has told us, it is unparliamentary.

I wonder if the chief magistrate for Upper Canada is not trembling in his high seat, in his high chair of judgement over the consistency of our national newspaper. That editorial made it very difficult for some of us to hold down our breakfasts at an early hour this morning.

I want to say, in concluding, I have said to the member for Peterborough (Mr. Turner), who sits as Speaker of this place, that it has concerned a number of us over the past number of months about the frequency of leaks around here.

We saw for example a few months ago, perhaps it was even more recently than that, the situation about the lockup for the release of the Dubin inquiry report. I got a copy of the Toronto Star containing the headline story, apparently

chapter and verse of that report which was being guarded in a lockup, as I walked into this place.

Mr. McClellan: The La Scala report.

Mr. Conway: My colleague the member for Bellwoods refers to it as the La Scala report.

I said to the member for Peterborough that I wanted that particular situation investigated because I felt somewhat suspicious about the circumstances surrounding the release of that report. Yes, it is true there are some of us on this side of the House who imagine, in fits of perhaps too partisan enthusiasm, that sometimes government ministers are wont to release, prior to the lockup's conclusion, a report to the press or certain parts of the press.

I wonder if in this respect the Ontario government has not itself been hoist with its own petard. I hope before we conclude this round of discussions the member for Peterborough will report to this House, with the help and the benefit of the Minister of Health (Mr. Grossman), the particular circumstances of how the so-called La Scala report, the La Scala version of the Dubin inquiry report on the Hospital for Sick Children in Toronto, managed to get into one of the Metropolitan dailies as and when it did.

In conclusion, this is a matter of honour. This is a matter of principle. I suspect no one knows and understands that more keenly than my friend the member for Muskoka (Mr. F. S. Miller). I hope he sets a high and good example in this respect not only for this Legislature but for the people beyond and for those who cherish the British parliamentary tradition.

Hon. Mr. Wells: Mr. Speaker, I would begin by saying that ever since this event began last Thursday evening people have certainly come to know a lot more about the budget process and also about the Treasurer. Several things have come to light and several feelings are held by most people today.

First, the Treasurer, according to long-standing British tradition, has certainly taken all precautions humanly possible for him to take to prevent any of his budget becoming public before he presented it here. The Treasurer has stated that and I have no hesitation in saying it is so. I also have no hesitation in telling this House something of which it is very much aware. The great majority of the people of this province, the commentators, news writers and editorial writers support the Treasurer. No one believes he should resign except perhaps a few people on that side of the House.

We are not debating a motion asking for the resignation of the Treasurer. There is nothing in this motion that suggests the Treasurer should resign. The only calls for his resignation come in the individual speeches made on this motion. I do not think there is anyone in this House who does not believe in the long-standing British parliamentary tradition surrounding the budget. We all believe in that and we all practise that. We would all believe that if those long-standing traditions were broken certainly a minister of finance, a chancellor of the exchequer, or a treasurer should resign.

What does Eugene Forsey say are those long-standing British traditions about the budget? He says --

Interjections.

Hon. Mr. Wells: Eugene Forsey used to be a very respected member of that party.

Mr. McClellan: He has belonged to all three parties. If there were four parties he would have belonged to all four.

Mr. Conway: You had better be careful. I didn't talk about Erik Nielsen.

Hon. Mr. Wells: He is certainly not one of our party. I do not care what those members argue or call back about Eugene Forsey or what the member for Renfrew North says about him or anyone else. I am sure he would not --

Mr. Conway: I didn't mention Erik Nielsen because I didn't want to be personal.

Hon. Mr. Wells: In the context in which we are talking, a person like Erik Nielsen is not in the same category as Eugene Forsey when it comes to British traditions or a thorough knowledge of the British parliamentary system. Whether members agree with his opinions or not, Eugene Forsey is recognized as one of the eminent Canadian students in this field. I would not differ with that opinion which is held by many people. It is the opinion I myself hold.

Eugene Forsey says the tradition of secrecy is based on the need to prevent people with prior knowledge of what is in the budget from making a financial killing. Then he says in this letter that was printed, "What is out of date about that?"

There is nothing out of date about that principle. That principle sticks, and I think every member of this House believes in it -- including myself, the Treasurer and the members of this government.

Mr. Nixon: What letter is the member quoting from?

4:10 p.m.

Hon. Mr. Wells: I am quoting a letter that appeared in one of the newspapers. It was a letter to the editor of the Globe and Mail. It concerned the Lalonde leak. As members will recall, after that leak the federal Minister of Finance suggested that perhaps there should be some change in the whole idea we have about secrecy concerning the budget and perhaps some new procedures.

Eugene Forsey was writing this letter to say: "What's out of date about all this? It's a longstanding principle. No one should make a killing out of budget leaks. Maybe even the federal Minister of Finance is wrong now in starting to use what happened to him as an excuse for saying we should change the whole system."

Interjection.

The Deputy Speaker: I just remind all members that this is not a debate.

Hon. Mr. Wells: What I want to say is that if we take Eugene Forsey's statement of what this principle really is, that the release of tax information allows an individual to make a private gain or a killing, and apply that to this particular situation, it certainly does not apply.

Mr. Conway: We don't know that.

Hon. Mr. Wells: Well, first of all, I want to say that my friend the Treasurer tells me the Globe and Mail has sworn an affidavit that it has no further information than what was published; and certainly no one else has come forward to--

Mr. T. P. Reid: Why didn't the Treasurer tell us that?

Hon. Mr. Wells: It has just now come to light and he has indicated that to me.

The point now is, what is the information that was published in the Globe and Mail? First, the information concerned an increase in the Ontario health insurance plan premiums. Although they may have been considered from time to time as a tax measure, at the present time, in terms of the Inflation Restraint Board and its ruling, OHIP premiums are considered a regulated price and therefore a change in them is not, in the strictest sense of the word, a tax measure.

Besides, let someone tell me who is to gain from knowing whether there is to be an increase in OHIP premiums. It certainly is not the kind of measure that could cause some private gain, such as the disclosure of a sales tax change, a corporation tax change or something of that nature.

Mr. Conway: That is assuming somebody else didn't find another garbage bag with other information.

Hon. Mr. Wells: We are assuming that has not happened; and until that happens --

Mr. Conway: Do you know that for sure?

Hon. Mr. Wells: It is all very well to assume that, but we are talking about the specifics of the incident that has occurred.

The second matter that was disclosed in the Globe and Mail story concerned estimates, and it concerned what has been viewed as the prior release of information about some of the appropriations and money that were going to particular ministries of this government.

My friends across the floor all know that in past years we have tabled the estimates in this House prior to the budget. We have tabled them sometimes three or four weeks prior to the budget.

Mr. Laughren: Here?

Hon. Mr. Wells: Yes. We have tabled them in here. But the point is, they had nothing to do with budget secrecy or the accountability of the Treasurer.

Mr. Conway: Why was the Treasurer so hard on Mr. Lalonde then, because he did not know before?

The Deputy Speaker: I remind the member for Renfrew North that he has had his opportunity. The government House leader may continue.

Hon. Mr. Wells: Let me just say that in the context of what the Globe and Mail picked up from a garbage bag and printed in its newspaper, there was nothing that falls within my concept or the general concept of a tax leak that would account for private gain to an individual and would suggest that a Treasurer or a Chancellor of the Exchequer should resign, such as Hugh Dalton did in the 1947 case. That just does not apply.

I just want to conclude by saying that I and this government see no point in having the standing committee on procedural affairs study this matter, because there is no one on the procedural affairs committee who would have had any experience with the preparation of a budget. That, I think, severely hampers them in their determination. I say that because I sat in on a study group that was talking about how budgets should be prepared. It was calling for more openness. In that group there was one person who had been a former finance minister of this country.

He said: "Just a minute, fellows, you don't know anything about it. You all can talk academically about this but unless you have ever prepared a budget you really do not understand the procedures."

Mr. Foulds: That is like saying the select committee cannot look at nuclear reactors because it does not have prior knowledge. Do not be silly.

Hon. Mr. Wells: No, in this case I think we have many more important things for the procedural affairs committee to do, including revising the rules of this House.

Let me just conclude by quoting from the last

section of the Globe and Mail editorial which said today: "Frank Miller is an honourable man caught in a great embarrassment not of his making. He should remain in his post as Treasurer and take measures to make his next budget as secure as he thought this one would be."

I have full confidence that out of this the Treasurer will be able to take those steps.

Mr. McClellan: Mr. Speaker, I am pleased to be able to respond to some of the comments of my honourable friend the government House leader, who had the chutzpah to quote Eugene Forsey on the subject of secrecy of the budget in connection with Marc Lalonde, while at the same time sitting beside the very man who, pre-eminently I think in the political field, was calling for Marc Lalonde's head on a platter.

Mr. Conway: You heard that too.

Mr. McClellan: I believe I heard the honourable Treasurer of Ontario demanding the resignation of the Minister of Finance in Ottawa. I believe I saw him mocking Marc Lalonde on television with the funny, comic book cutout.

Mr. Mackenzie: That is the only thing he is embarrassed about.

Mr. McClellan: I think my friend shows a fair degree of nerve and audacity quoting Eugene Forsey in defence of Marc Lalonde's right to stay on as Minister of Finance when his colleague beside him has been so vociferous in the opposite point of view.

As my friend rightly pointed out, we are not debating the question of resignation or no resignation.

Mr. Kolyn: Why don't you quote the senator now?

Mr. McClellan: I do not have the senator's sacred text in front of me, but we are not debating the question of resignation or no resignation.

Mr. Martel: You are the ones who demanded the resignation, not us.

Mr. McClellan: We are debating the question of whether the matter should be referred to a standing committee so that the matter set out in the resolution can be looked at rationally. It does not do anybody's peace of mind any good to make reference to this morning's editorial in the Globe and Mail, talking about chutzpah and audacity, nerve and gall. For a newspaper to precipitate our dear Treasurer into this jackpot in the first place and then, Pontius Pilate-like, wash its hands of all responsibility or complicity verges on farce.

The third point, in response to the government House leader, has to do with the Ontario health insurance plan. For some reason, the government House leader does not seem to understand that OHIP is a tax on the people of this province. I think I set it down but I have a reference in Hansard where the Treasurer himself -- page 946 of Hansard, April 12, 1979 -- referred to OHIP premium increases as a taxation measure. This particular taxation measure raises $1.4 billion, which is more than the government raises from corporation tax.

The government House leader knows full well that for many companies and many employees and employers OHIP is a de facto payroll tax, that OHIP premiums are covered under collective agreements. The collective agreement clauses stipulate that if OHIP goes up, the employer who is paying the share of OHIP on behalf of the employee will automatically pick up the increase. If there is an increase in OHIP premiums, it has an impact on many companies in this province in exactly the same way that an increase in any other kind of tax does.

When companies are working out their pricing policies in relation to their competitors, they will bear this reality in mind, so companies that have advance knowledge of the impending OHIP tax increase of five per cent will begin to fold it into their pricing calculations immediately upon receiving it. So we cannot pretend that it does not have an impact; it does.

4:20 p.m.

I suppose one of the reasons that perhaps the government can get away with the leak of an OHIP premium tax increase as opposed to that of a sales tax increase, a corporation tax increase or a personal income tax increase is that so many citizens are not affected as businesses or corporations; they are simply low-income people for whom the OHIP premium is already an overwhelming burden, or perhaps they are among the many thousands of people who simply cannot afford OHIP premium coverage in this province at all because of the cost.

One of the reasons that a reference to a standing committee would be useful -- and it does not have to be the procedural affairs committee; if the government House leader has another committee up his sleeve that is less burdened with --

Mr. Nixon: He has got lots of committees up his sleeve.

Mr. McClellan: Well, the House leader of the Liberal Party has things up two sleeves with respect to the procedural affairs committee -- as does my House leader, I regret to say.

If that committee is too busy with the rules changes, perhaps there are other places it could go; but the government will have to come up with a more plausible rationale for not referring it to committee than the fact that it should not be the procedural affairs committee.

There are unanswered questions as to whether the budget leak was theft or whether it was negligence. We have heard from the company, giving its self-exoneration here in the House and in the media outside, and the extent to which the Treasurer has joined in this process of self- exoneration.

But really, the facts of the leak are quite preposterous. There is a contract between the government, the printing company and the Ontario Provincial Police. Security, the prevention of leaks and the preservation of secrecy are the responsibility of the Treasurer. Written into his contract with the printing company is an obligation to enforce and maintain secrecy. The OPP, those vigilant guardians of law and order, is brought into the printing company premises to ensure the terms of the secrecy provisions of the contract are carried out. All material that is not to be used is supposed to be shredded. There are OPP on the premises.

This company has had the contract for over 10 years; presumably it knows what its obligations are. And what happens? Key portions of the budget in the form of galley proofs are carefully -- I assume under the vigilant eyes of the OPP and the management of the printing company -- deposited in a green garbage bag. Perhaps the material was escorted under armed guard to the receptacle, carefully put in the Glad bag and perhaps tied with a little string.

Then, after they made sure the material had been placed in the proper receptacle according to the terms of the contract and the traditions of secrecy in force at the company, they carefully deposited the documents in the back alley of the company -- at least, I understand it was the back alley.

Hon. G. W. Taylor: The Globe says "abandoned."

Mr. McClellan: Oh yes, the Globe and Mail says it was abandoned, but the position of the government, I believe, and of the printing company is that the secrecy provisions of the contract were being fully maintained and there was nothing untoward going on in this place.

I cannot credit the words of the Solicitor General that this material was abandoned in the back alley. I assume this was part of their security regime. I assume that, having placed the galley proofs in the green garbage bag, they then took them under armed escort and carefully deposited the documents on their private property -- unfortunately outside rather than inside. But, of course, who can quibble with security arrangements under the watchful visage of the OPP with a 10-year history behind it?

Mr. Conway: And they hadn't been to La Scala.

Mr. McClellan: They had not even been to La Scala, we are told by the member for Renfrew North.

There is obviously also an element of farce in the events surrounding the leak. The question of whether it was theft or negligence is not one that can be easily answered, but neither can it be easily dismissed. It is the responsibility of the Treasurer to maintain secrecy.

His only defence, we believe, is the defence of surreptitious entry and theft in violation of the law. I believe that is his only plausible defence.

I am not at all sure