Manitoba Hansard — Sitting 65 (33rd Legislature, 2nd Session)

33-2-65

Manitoba — Debates (Hansard)

LEGISLATIVE ASSEMBLY OF MANITOBA Tuesday, 9 June, 1987. Time - 1:30 p.m. OPENING PRAYER by Madam Speaker. MADAM SPEAKER, Hon. M. Phillips: Presenting Petitions . . . Reading and Receiving Petitions . . . PRESENTING REPORTS BY STANDING AND SPECIAL COMMITTEES MADAM SPEAKER: The Honourable Member for Burrows. MR. C. SANTOS: Madam Speaker , the Committee of Supply has adopted certain resolutions, directs me to report the same and asks leave to sit again . Madam Speaker, I move , seconded by the Honourable Member for Inkster, that the report of the committee be received . MOTION presented and carried.

MINISTERIAL STATEMENTS AND TABLING OF REPORTS MADAM SPEAKER: The Honourable First Minister. HON. H. PAWLEY: Thank you, Madam Speaker. Madam Speaker, in the 1986 Throne Speech, this government set forth four basic priorities by which it would be guided throughout this term of office. We set those priorities after listening very carefully to the people of Manitoba .

By renewing my government's mandate, Manitobans told us that they wanted a government that would create jobs, that would work hard to improve the rural economy, that would bring greater fairness to the lives of Manitobans, and one that would not be afraid to fight for the rights of Manitobans . In the Throne Speech that opened this Session , we reaffirmed our commitment to those priorities and among the initiatives we outlined was a commitment to defend the interests of Manitoba natural gas consumers. Madam Speaker, the natural gas policy I'm announcing today is a major step in the fulfillment of that commitment.

More than 200,000 Manitoba households, community institutions and small businesses rely on natural gas. In total, 32 percent of the energy used by Manitobans is supplied by natural gas. The price and availability of natural gas is critical to the Manitoba economy and to the quality of life we enjoy. Lower energy costs mean stronger businesses and more jobs . Making fairly priced energy alternatives available to more parts of Manitoba would help build the economy. Bringing fair prices to Manitoba families would put more money back into the pockets of ordinary Manitobans .

Madam Speaker , it has become clear to most Manitobans that the current system, in which the natural gas industry operates, is incapable of meeting these needs or the long-term goals of Manitobans. In 1973, the world changed. OPEC jolted the world with the first of a series of energy price increases, which fundamentally altered the economics of energy. In Canada, regulated prices for petroleum and natural gas were developed during the Seventies and Eighties to safeguard Canadians against price shocks originating outside our country.

In 1986, the deregulation of the Canadian natural gas market again changed Manitoba's energy world . Many regulations designed to ensure fairness to consumers were removed by other governments and without Manitoba 's concurrence . Today Manitoba consumers are at risk. They have the worst of both worlds. They have not yet received the benefits of lower priced natural gas in our present market environment, and they are vulnerable to future price shocks without any ceiling in place. Your government has continuously tried to ensure that Manitobans are not adversely affected by these changes .

Efforts to convince other governments and the companies delivering natural gas to Manitobans that deregulation must work for all consumers have failed . Over the last year-and-a-half, we have made every effort to introduce fairness into the deregulated natural gas market . We have tried with all the major players in the natural gas industry. We have tried to negotiate a fair and a just arrangement on pricing and supply . In December 1986, we asked the Manitoba Public Utilities Board to investigate the prices proposed by Inter-City Gas.

The board was asked to determine if the prices were competitive and if existing means were adequate to protect consumers under deregulation . Evidence submitted by our staff and by some of Canada's top experts in natural gas revealed the excessive and the discriminatory nature of natural gas prices in Manitoba. We were joined in our efforts by the Consumers Association of Manitoba, by the Manitoba Society of Seniors , who argued that, in their words, the prices were unfair, they were unjust, and they imposed a hardship on the people of Manitoba.

The reports of the Public Utilities Board demonstrated that, despite deregulation, there is not a competitive price, a competitive market in natural gas. These reports confirmed that prices were excessive and they were discriminatory, and that changes are required to protect the interests of Manitoba consumers . The Public Utilities Board urged the government to take action to ensure fair prices for Manitoba consumers . This government takes this responsibility to the people of Manitoba with the seriousness with which it demands. We have reviewed our experience with natural gas.

We have examined the history of our provincially controlled hydro-electric system. We have noted the ability of Manitoba Hydro, a utility owned by Manitobans, to provide reliable long-term supplies of electricity to all Manitobans at the lowest rate structure anywhere in North America. 2891

Tuesday, 9 June, 1987 Madam Speaker, Manitoba families and Manitoba small businesses are now expected to pay $3 per 1,000 cubic feet of natural gas, while the same Canadian gas is being sold, in many instances, to Americans and to big businesses for under $2 per 1,000 cubic feet. No responsible government can simply sit back and watch that kind of injustice imposed on the people that it was entrusted to serve. When Manitoba sells electricity to the Americans, we offer that electricity on the same or on better terms and conditions to Canadian provinces.

Madam Speaker, we would expect Alberta to treat their Canadian neighbours in a similar fashion . Manitobans are not second-class citizens. They deserve and they have a right to a long-term , secure supply of natural gas at a fair price. The policy I'm announcing today will ensure fairer natural gas prices for all Manitobans. It will ensure Manitobans have longer-term security of natural gas supply at fair prices . This policy will ensure fair natural gas distribution costs within Manitoba. Where feasible, it will provide Manitobans with increased access to natural gas through extension of service .

Madam Speaker , I am pleased to announce today that, under the direction of my Minister of Energy, the Province of Manitoba had successfully negotiated and signed long-term contracts with natural gas producers to supply gas to Manitobans at prices below $2 per 1,000 cubic feet. That, Madam Speaker, is substantially lower than the $3 currently being charged and is below the $2.25 price the Public Utilities Board concluded was reasonable in today's market.

The producers we have purchased this natural gas from are satisfied the price is fair and sufficient to ensure the continued long-term viability of the natural gas industry . Furthermore, the contracts are long term, satisfying the Alberta Government's concern in that area. These contracts provide long-term security of supply from diversified sources at fair prices. Madam Speaker, although natural gas has been secured, there remain a number of challenges that must be overcome before savings begin to flow to Manitobans .

The Government of Alberta may attempt to impose retroactive restrictions on natural gas exports which could impede the flow of fairly priced natural gas to Manitoba . We have and we will work with the Governments of Alberta and Canada to ensure that this natural gas flows to Manitobans . We are not looking for special treatment in this matter. Rather, we expect that Manitoba families and small businesses be treated in this same manner as Americans and big businesses. I am confident, Madam Speaker, that we will be able to resolve this issue in a manner that is just and is fair to all parties .

Madam Speaker, I am also confident that the National Energy Board will approve the arrangements to have the natural gas transported to the Province of Manitoba and, finally , this fairly-priced natural gas must be distributed in Manitoba.

If one thing has become obvious in the past year and-a-half it is that, if Manitoba consumers are to get the fairest prices for natural gas in this complex environment, then the agent representing Manitobans in the purchasing and distribution of that natural gas must have, as their exclusive interest, the concerns of Manitobans and that agent must have the strength th at is required to meet those concerns . Madam Speaker , this situation does not currently exist. That is the reality of today's system.

It is not the sole fault of one government or corporation , but rather • the result of a system that has failed Manitoba consumers. It is for this reason that my Minister of Energy has • entered negot iations with Inter-City Gas to purchase i Manitoba's natural gas distribution system . Negotiations, to date, are proceeding well. I expect . these negotiations to be concluded in the near future. To facilitate this purchase , my Energy Minister will , introduce legislation in this House tomorrow to create a new public utility called the Manitoba Consum ers · Gas Corporation .

Through this new public utility, we will distribute , natural gas to Manitobans at a fair price. We will also , pursue the purchase of natural gas reserves in order , to provide guaranteed long-term security of supply at continued fair prices . The activities of the Manitoba Consumers Gas · Corporation will be financed out of its own revenues. ; The purchase of the Inter-City Gas distribution system · will be financed out of natural gas revenues, while providing a reduction on Manitobans ' natural gas bills. , At the same time, Manitobans will be gaining a precious asset which can be used to protect our future.

The Manitoba Consumers Gas Corporation will . provide the vehicle we need to implement sound natural gas polic ies. Together, these policies will protect the interests of ordinary Manitobans , now and in the decades to come . We believe that only a strategy based , on a long-term commitment to Manitoba, and a belief in the ability of Manitobans to meet the challenges of the future can take us forward toward secure supplies of energy at fair prices to Manitoba . These policies recognize the new realities of deregulation and offer a way out of the current morass of unfair prices .

They offer a Manitoba solution to a problem which threatens our long-term economic health, our long-term economic growth, and the quality of life for all Manitobans . Madam Speaker, by carrying out these new policies, 1 we will be able to purchase natural gas on behalf of Manitoba consumers at fair prices. We will be able to distribute this natural gas to Manitoba consumers at fair distribution costs. Where feasible, we'll be able to extend natural gas services, providing low-cost energy alternatives to more Manitoba communities.

These policies will ensure that natural gas customers large enough to contract their own requirements are able to get their gas distributed at a fair price. By establishing the Manitoba Consumers Gas Corporation , by directly purchasing natural gas on behalf of Manitobans, by bringing the distribution network for natural gas into the hands of Manitobans , and by continuing to fight for fair treatment for Manitobans, the people of this province can expect to save over $50 million annually .

The average household can expect to save about $150 on their annual natural gas bill, while the average small business will realize savings of almost 1,600 per year. In addition , Madam Speaker, Manitobans will be in a much better position to avoid the effects of future 2892

I t Tuesday, 9 June, 1987 price shocks resulting from world fluctuations or the impact of deregulation. Madam Speaker, this is a bold initiative, but it is certainly not one that is unprecedented elsewhere in Canada . Governments of all political stripes have followed this course when it was necessary to defend the public interest . The inequities which Manitoba consumers are being subjected to in natural gas pricing has created in this provice such a necessity.

A failure to act decisively in the face of the unjustifiable burderni being placed on Manitobans would be a betrayal of the trust which they have placed in this government . Madan- <;peaker, it is because we are committed to fair prices and the extension of services that we are now acqu iring all the tools we need to represent Manitobans in the natural gas industry. This will not be easy. We ask all Manitobans to support our efforts to obtain fair natural gas prices and long-term energy security for the Province of Manitoba . Together we can build a better and more secure energy future for the province.

By standing together, we can bring greater fairness to Manitoba consumers and to Manitoba small businesses . We can create more jobs and, with vision and determination, we can together work towards further building our economy. Madam Speaker, this is a great challenge and a great opportunity for Manitoba and I am confident Manitobans will meet the challenge and will realize that opportunity . Thank you . SOME HONOURABLE MEMBERS: Oh, oh! MADAM SPEAKER: The Honourable Leader of the Opposition . MR. G. FILMON: Thank you, Madam Speaker.

I thank the Premier for making that announcement here today, to set aside the rumours that were prevailing throughout the province and throughout the media during the past 24 hours, and to ensure that we were aware of the plans and indeed the direction that the government was taking with respect to natural gas distribution in Manitoba . I find it interesting, Madam Speaker , that this NOP administration, which has proven to be the most incompetent at running Crown corporations in the. province's history, now sets ~s a priority bringing another multimillion dollar Crown operation under its jurisdiction .

Madam Speaker, this is .the group of people who changed The MTS Act back in 1982 . After that corporation had run with only two increases in over 25 years, they changed the act, passed an Order-in Council, set up a new arm .of that Crown corporation, known as MTX, that would allow them to spread the influence of the corporation; create jobs as they say in this · news statement; increase their control of the economic activity in this province ; and do business in places like Saudi Arabia, China, Texas, California, all over the world, Madam Speaker.

They changed the mandate from that of providing the best possible telephone and telecommunications service to the people of Manitoba at the least possible cost into one of giving them an opportunity to market their expertise and their capabilities and their equipment that they could represent anywhere in this world. Well, Madam Speaker, when they passed that change in the act and when they passed that Order-in-Council and when they undertook all those activities as a Crown corporation, under the venture known as MTX, they saddled the people of Manitoba with a $27 million debt.

Madam Speaker, this is the same group who took a publicly owned automobile insurance company that operated in a monopoly within the province of Manitoba, whose only customers for auto insurance were . the people of Manitoba, who had no choice but to deal with this publicly owned company in a monopoly situation, a situation of no risk, they took it and last year lost $58 million - $58 million . That is the track record of this .government in running multimillion dollar Crown corporations .

Madam Speaker, this is the Premier making this announcement today who, in 1981, said that he was going to start up ManOil Corporation as a publicly owned Crown utility in the oil and natural gas business that would be able to save money for Manitobans and, in fact, invest its profits in health care and education . Today we're closing hospital beds, because that corporation lost $700,000 since its inception, Madam Speaker . Thi.s is the Premier , Madam Speaker, who in 1986 promised that he would lower gasoline prices in this province .

He passed legislation to make that capability available to the province and we now still have amongst the highest, if not the second-highest, gasoline prices in this country. Madam Speaker, now we're being told that it is absolutely urgent and necessary that this NOP administration get their hands on the distribution of natural gas in this province. It's in the urgent public Interest that we do that. We take over all natural gas distribution and, Madam Speaker, some of us have to ask why, because we already have many of the tools that we need to ensure that the customer can be protected in this province .

No. 1, it's a totally regulated industry; No. 2. the Public Utilities Board, which has been. appointed by this government, sets the prices. These are the people who appointed the Public Utilities Board who set the natural gas prices in this province. They have no investment, they have no risk and they collect millions of dollars of taxe.s .from ,that operation In the province . Yet, Madam Speaker, the Premier IS telling us that we don't. have the tools ., He says that ·the Public Utilities Board urged that they :take · action · but, Madam Speaker, they urged that competitive · bids for supply be obtained.

They urged a number of regulatory changes, but they didn't urge that the government buy the natural gas distribution facility in this province. Madam Speaker, one has to wonder why, because none of us would argue against lower natural gas prices for Manitoba consumers. That has to be an objective that all of us want to see realized, Madam Speaker. Madam Speaker, how does this major financial commitment serve that purpose? How does it ensure that we're going to have lower gasoline prices and what other effects will it have?

For Instance, how will it impact on our finances in this province, our already troubled finances which see us in a situation where every man, 2893

J~~•day, ~ Jun~, 1~7 woman anti chilcl has a debt of $9,500 in this province, which see us in a situation where we had to add $369 million in additio~ai taxes just two months ago in the Budget that was brought in by_ tt)is aoministrationiH,ow is that going to be impacted by buyif'\g and operc1ting a natural gas distribution f1;1cilitY, in IV!ani,obaf . what evi.dence does .the goveroment have that !hey can ensure these substantic1lly lower gasoline . prices . to jU!;tify the risk that Manitobans are being . put urider, to the tune of hundreds . of millions of dollars of additional risk now in the hands of this NDP adnilnistration ·with its track record?

What impact .woul(l this vent1,1re have Oh the operation of a sister energy utility, the Manitoba Hydro, now a competitor of this gas distribution outfit? · · . . Now, what additional impact will it have on tt)e cit>ility of all Manitobans to. 'enjoy natural gas distribution ih Manitoba? What assurance 1Nill we _hav~ th~t Manitobans who do not enjoy natural gas distribu _tion will not be sub5idizing those of us who do· enjoy natural gas distribution throughout the parts of the province in which we live?

Madam Speaker, if this deal is a good deal, the11 it ought to be reviewed by a totally independent inquiry that takes a look at the economics .of, this, .that objectively - puts forward the pros and the cons, the advantages and disadvantages and, above all, the financial impacts on Manitot;>ans. Madam Speaker, if this will stand the .test of public scrutiny, then all Manitob~ns will support it. If they know that the assurances they are looking for will be provided without the major risk of hundreds of milli.ons of dQllars in the hands of this administration, then they will support it.

But, Madam Speaker, at this point in time ,·we knoVI( it as a political decision, a political decision th~t has been made by this administration that has saiQ, 1,1nder this Premier, that it wants to use Crown corporations as instruments of public policy. It wants to have .more hands-on control of all aspects of our econoqiy, rnore control over how dollars are spent in every · asp~t of our lives in Manitoba. Based on that kind of philosophy, they have chosen, Ma.dam Speaker, to buy a natural gas distribution facility for the people of Manitoba.

I say, Madam Speaker, that the public will support this if they know that it has been . looked at independently, that it wiU stand the test. of public scru,t,iny in an independent inquiry, that it is not being r:nade simply on a political decision by a government that ,has a predisposition to take more and more into Crown operation , more and more of the operation of businesses in .this province under its control. MaQam Speaker, if it stands . the test of an inquiry, then it may be seen as good policy. . . . .

At the moment, Manitobans know that they will ti.ave millions of dollars of their tax money further placed at risk by this government and they won't know anything more, unless they see a full and independent analysis and inquiry and know that this is not simply a poliHcal de9ision. Thank you very much. MADAM SPEA~ER: The Honourable Member for River Heights on a point of order. MRS. S.

CARSTAIRS: Thank you, Madam Speaker, not for a point of order, but with an announcement that I am in a conflict of interest with regard to this particular proposal by the governmen( My husband i5 the vice-president of Inter-City Gas, which is the total • parent of Inter-City ~as Utilities, of which utilities 1 division Manitoba has a part. · ,,, I would like a ruling from this House as to whether ornot I will be al;>le to continue to participate in question ·0 period, altt)ough I wo_uld obviously not participate in ~ any questions having to do wi,h this particular endeavour or plan 'on behalf of the government.

I would like a ruling, so that I · may remain in the House to ask questions of a different nature . MADAM SPEAKER: The Honourable Attorney-General. HON. R. PENNER: Madam Speaker , I wouldn't want the Member for River Heights necessarily to rely on m~ opinion, but having been the . . . SOME HONOURABLE MEMBERS: Oh, oh! HON. R. PEN.NER: I said not necessarily, you see I left myself an out. But having been the Minister responsible for the legislation in question, it's clear that when the bill is introduced , at that juncture, anyone, whether it's .the .

Member for River Heights or anyone else on either side ~ of the House ·who has any interest in either ICG or in .J Bell or any of the parent comp;mies , would declare it ~ a confli .ct of interest and absent themselves during any (j time when the matter is being discussed .. ~ I, for one , don 't see and certainly this side of the i'l House would not raise the issue that the member or ·; anyone e.lse in her -position tias a c::onflict of interest fflj at the time of a Ministerial Statement or during the question period which follows. '.j MADAM SPEAKER: I will take that matter under advisement , and we'll certainly notify the Honourable Member for River Heights as soon as possible .

Notices of Motion . . . Introduction of Bills . INTRODUCTl9N OF GUESTS ~ ~ I ·~ "ADAM SPEA~ .ER: Before moving to Orc11 Questions, may I direct the attention of honourable members to the gallery where we have 75 students · of Grade 6 from ,j the Shamrock School under the direction of Mrs. Labelle. The school is located in the constituency of 1 the Honourable Member for Niakwa. 'l We have 29 students from Grade. 5 from the Ecole ·'~. Lavalle:e. 'The students are under the direction of Ms. S Yvette Dion . The school is located in the constitutency ,1 of the Honourable Member for Riel.

On behal'f of all the members , we welcome you to the Legislature this afternoon . < ORAL QUESTIONS ., Natural gas distribution "'. public inquiry re entrance of gov't into MADAM SPEAKER: The Honourable Leader of the Opposition . MR. G. FILMON: Madam Speaker , my question is for ·~ the Premier.

Tuesday, 9 June, 1987 Given the many concerns that Manitobans will obviously have about the potential impact of an investmen t in the hundreds of millions of dollars in a publicly owned Crown utility in natural gas distribution and the many aspects to that industry , the regulation, the price setting and all of the aspects of that industry and the potential risk of an investment of that nature in the hands of a Crown corporation, I wonder if th e Premier would agree to commissioning a full public inquiry into the potent ial entrance of this government into the natural gas distribution field, so that all Man it obans will be aware of the advantages, disadvantages and the economics of such a decision .

MADAM SPEAKER : The Honourable First Minister . HON. H. PAWLEY: Madam Speaker, this is a point in time where action is required on a timely basis . It is clear , at this very time, gas is being shipped into the United States, as I indicated in my statement, at prices that are less than $2 per thousand cubic feet. Clearly the timing is now for decisive action . Madam Speaker , we cannot afford to delay, as requested by the Leader of the Opposition . We cannot afford to procrastinate when the time is with us at this time.

I do not know , Madam Speaker, whether the time would be on our side six months from now or a year from now , if we should delay. Madam Speaker , in any event , there will be opportunity for committee hearings and submissions to be presented in the normal course of the bill which will be introduced tomorrow. MR. G. FILMON: Madam Speaker , surely nobody can come and tear up the natural gas distribution facilities . Surely nobody can remove anything from this province in the way of natural gas distribution infrastructure. MADAM SPEAKER: Does the honourable member have a question? MR. G.

FILMON: What concern is there that a delay would cause, in order to have the public fully informed on all of the economics of such a decision, a major $100 million decision? HON. H. PAWLEY: Madam Speaker, I don 't believe the Leader of the Opposition ever asked a question on this, so he may not be aware that the Public Utilities Board, I believe, sat for upwards to one month.

They received submissions from many, many individuals and organizations in the Province of Manitoba , the senior citizens ' group in Manitoba, the Consumers ' Association , the anti-poverty groups , other organizations and individuals within Manitoba. The Leader of the Opposition may not know , Madam Speaker, that there were many oil energy experts that gave best evidence before that Public Utilities Board .

The Leader of the Opposition may not be aware that , after one month of very extensive and complete hearings - I suspect as complete and extensive hearings as we could have anywhere in Canada - the Public Utilities Board was left with no alternative but to state , quite clearly, that natural gas rates in the Province of Manitoba were first excessive, they were discriminatory . Madam Speaker , we required no further public inquiry to inform ourselves that the natural gas rates in Manitoba are excessive and are discriminatory .

We need no further public inquiries to delay decisive action on the part of this government , to ensure that the consumers of Manitoba are treated with fairness , which they deserve , insofar as the payment of natural gas bills in the Province of Manitoba. MR. G. FILMON: Madam Speaker , the Public Uti lities Board hearings were not into the purchase of a natural gas distribution fac ility by the Provincial Government. That proposal was never on the table and was never the subject of any discussion . What is the Premier afraid of in terms of holding a public inquiry into this proposal? MADAM SPEAKER: Order please.

That question is out of order. Would the honourable member care to rephrase it? MR. G. FILMON: Why will the Premier not conduct a public inquiry into this proposal? HON. H. PAWLEY: Madam Speaker, as I've indicated by way of my previous answers, th is is not a time for delay, it's not a time for procrastination. Time may, in fact , be on our side. This is a time for leadership , Madam Speaker, and this government is determined that it must demonstrate that leadership. _W.Or-kers Compensation Board - underestimated deficit MADAM SPEAKER: The Honourable Leader of the Opposition. MR. G.

FILMON: My quest ion is for the Minister responsible for the Workers Compensation Board . Madam Speaker , I wonder if the Minister has been informed that the former Director of Finance of the WCB, in a report to the board late last year just prior to his leaving the board's employ, stated that the present liabilities of the Workers Compensation Board are significantly understated . That is the deficit in the view of that Director of Finance was much larger than the $84 million that was declared in the last financial statement. MADAM SPEAKER: The Honourable Minister responsible for the Workers Compensation Board.

HON. H. HARAPIAK: Madam Speaker, yes , I am aware of the report that the Director of Finance put out and the actuaries and the auditors have worked with us since that point . They have analyzed the books that they usually do and they did not agree with his analysis . Workers Compensation Board - pensions be indexed MR. G. FILMON: Madam Speaker, was the Minister informed that the Director of Finance in that report stated that the pension obligations of the Workers 2895

Tuesday, 9 June, 1987 Compensation Board should be indexed, as is common with other Workers Compensation Boards, and that indexing would increase the liability by an amount of $90 million. Was he informed of that? HON. H. HARAPIAK: Madam Speaker , it is my understanding that he did inform us. The rehabilitation pensions were the ones that should be funded and we did recognize that . The actuaries did recognize it last year and, when we received that information , we did include that information in our annual report. Workers Compensation Board - reserve for existing claims or future rehabilitation payments MR. G.

FILMON: Madam Speaker, was the Minister informed that the Director of Finance in that report indicated that the board currently was not building in a reserve for existing claims and rehabilitation or for future rehabilitation payments , wh ich unde r the continuance of the current rehabilitation policy , would increase the liability of the board by $20 million to $30 million . Was he informed of that? HON. H. HARAPIAK: Yes, we were informed of that and the rehabilitation is part of the reason we now have an unfunded liability . We took that into consideration .

The actuaries who were working with the Director of Finance, when they were working with him, that's when he came up with the report saying that there was an unfunded liability, and that 's why we have come up with the final figure the actuaries came up with prior to the tabling of our final report, was $84 million . Workers Compensation Board - rehabilitative costs used for cover-up of waste and mismanagement MR. G.

FILMON: Madam Speaker, was the Minister informed that in the Cormack report that was given to the board , the report implied that the board was attributing costs, substantial costs, to the rehabilitation department which were not rehabilitation costs? In other words, it was becoming a catch-all to cover up for the waste and mismanagement of the board . HON. H. HARAPIAK: Madam Speaker, the Cormack report is an internal report which was asked for by the Workers Compensation Board. It was brought forward to make improvements to the Workers Compensation which was in a mess when we formed government in 1981.

We found that workers were not receiving their just rights, widows were not receiving their payments, the children of the injured workers were not receiving their claims either . We have made great gains in the area of rehabilitation. Madam Speaker, there is still a lot to be done in the area of rehabilitation and we recognize, when you'r e moving to an area of reform , there are going to be some adjustments to be made to the system when you 're making that reform.

The Workers Compensation Board recognizes that and that's why they asked the senior people to carry out a review and see in what areas they can make recommendations to make the system work better for injured workers . Workers Compensation Board - underestimated deficit MR. G. FILMON: Madam Speaker, further to the same ; Minister. Was he informed that in this new system of operation ; of the Workers Compensation Board that he says is going so well, the former Director of Finance Mr Wiebe · in his report stated that in totality the board;s u~funded liabilities or deficit may be understated by $150 million ?

That's $150 million more than the $84 million that was stated publicly by this Minister. HON. H. HARAPIAK: Madam Speaker, this area of the unfunded liability is addressed in the report by the : review committee, and I'll be tabling the revi ew; committee on Thursday. Thursday, I go into my Estimates . If the Leader of the Opposition would like to have further discussion on it, I think th at would be an appropriate time to have further discussions. Workers Compensation Board - losses due to not collecting premiums due MADAM SPEAKER: The Honourable Member for Springfield. MR. G.

ROCH : Madam Speaker , to the Minister responsible for the Workers Compensation Board . Has the Minister been informed that a former Director of Finance stated in his report to the board prior to leaving that the board continues to experience significant annual losses as a result of not collecting all the premiums due? HON. H. HARAPIAK: Madam Speaker, I would leave it up to your judgment, but it appears to me that it's the same question that the Leader of the Opposition asked. We will be tabling the review committee on Thursday, and we will be deal ing with the Workers · Compensation Annual Report on Thursday.

We can deal with that question at that time. Workers Compensation Board - effect of new internal policies MR. G. ROCH: Madam Speaker, to the same Minister. Has the Minister been informed that many new internal policies have been adopted which have had a significant cumulative effect or, I should say, cost impact , which the government and board were not aware of prior to adopting these policies? HON. H. HARAPIAK: Madam Speaker , I mak e no apologies for any of the programs that have been implemented to deal with the rehabilitation of injured workers .

All the money that has been spent has been spent to help the injured workers , the widows , and the children of thos e injured workers. And sure, there have been some increase in costs, but you have to look at the programs that have been delivered since 1981 , the improvements in the program that is coming to that part of our society. The improvements are imm ense and there have been costs involved with it. 2896

Tuesday, 9 June, 1987 Workers Compensation Board - policy change to stop spiralling costs MR. G. ROCH: Madam Speaker, to the same Minister. Has he been informed that the former Director of Finance has stated, and I quote : " Serious consideration must be given to policy change in order to stem the spiralling costs of the Workers Compensation Board."? HON. H. HARAPIAK: Madam Speaker, I could not hear that question. I wonder if he'd repeat it for me, please . MR. G.

ROCH: I asked the Minister, Madam Speaker, has he been informed by the former Director of Finance , that - well, I'll quote it again , Madam Speaker - the former Director of Finance stated that , "Serious consideration must be given to policy change to stem the spiralling costs of the Workers Compensation Board ." Has the Minister been informed of that? HON. H. HARAPIAK: Madam Speaker, that's very clearly the reason that the former Minister asked for the review committee to look at all aspects of the Workers Compensation . The policies are all being looked at, and the financing is also being looked at.

We will be tabling the report , which deals with all parts of the Workers Compensation , on Thursday . Welfare system - abandonment of two-tiered system MADAM SPEAKER: The Honourable Member for River Heights . MRS. S. CARSTAIRS: Thank you, Madam Speaker. My question is to the Minister of Economic Security . Earlier this Session, Madam Speaker , I asked the Minister about the two-tiered welfare system which we have in this province. He said that the government was considering it, but that it would not solve all the problems .

But, Madam Speaker , it certainly would have prevented the balkanized system which is existing in Brandon at the present time with regard to the Westman Women's Centre. When will this government abandon the two-tiered system which causes such inequities and. thereby allow women to go to an abuse centre such as the Westman Region when they require such a service? MADAM SPEAKER: The Honourable Minister of Employment Services and Economic Security. HON. L. EVANS: Thank you, Madam Speaker.

A question related to this matter was raised a week or so ago, and I can tell the honourable member that I share her concerns about what is happening at that Westman shelter . There are other elements to financing of that organization of course, such as a cutback of a major grant, elimination of major funding by the Federal Government which is a reality of thousands and thousands of dollars, between $25,000 and $30,000 .00.

Also, the City of Brandon has a particular approach whereby they are not following the recommendations of my department for implementing an adequate per diem in order to keep that organization viable . But to answer the question directly , Madam Speaker , this government has stated on various occasions that philosophically we believe in the one-tier system. That matter is under active consideration and, when a policy decision is made, it will be announced in due course . Brandon officials re liens on abused women MRS. S. CARSTAIRS: A supplementary question to the same Minister.

Has the Minister met with Brandon City officials regarding the liens placed on abused women, in that women who are abused are unlikely to get financial help from the person who has been abusing them? HON. L. EVANS: Madam Speaker, the question of placing liens in this matter was meant to be a progressive move inasmuch as the attempt was to penalize, if you will, or to collect from the errant spouse. However, I agree with the member who perhaps impl ied in her question that this can have a negative impact on the treatment of the women , particularly those going to a shelter.

I haven't discussed this matter directly with the City of Brandon officials - my staff have - although I have discussed the matter with officials of the Westman shelter. Special Needs Allowance - regulations MRS. S. CARSTAIRS: Madam Speaker, a new question to the same Minister . The Minister has indicated that many of his regulations or the guidelines to the regulations are not being followed, and one which I raised before was the $150 Special Needs Allowance which he in fact said was in effect but no longer realistically being used .

Madam Speaker, I know of a case in this city where a couple was denied the purchase of a crib and told to use a bureau drawer because they had already exceeded their $150 allowance . Can the Minister explain why he does not put those guidelines in regulat ions? HON. L. EVANS: If the honourable member has any particular case where she believes someone has been treated unjustly , I'd be very appreciative if she would draw that to my attention. With regard to this Special Needs category , indeed the $150 is a regulation that is in place.

But I would also advise the member that the personnel in the regional offices have the authority to raise the Special Needs limit to $500 at their own discretion without coming back to senior people. So, in effect, the regional staff, the field staff can go up to $500.00 .

But I'd also point out, Madam Speaker, where there is real need - and I can document cases where we pay thousands of dollars of Special Needs, in the case particularly where people have been ill, where they need special medical equipment, special transportation, special treatment, special services and indeed we pay thousands of dollars in special needs to those people who are deserving of that assistance . 2897

Tuesday, 9 June, 1987 Workers Compensation Board - losses due to not collecting premiums due MADAM SPEAKER: The Honourable Member for Niakwa . MR. A. KOVNATS: Thank you, Madam Speaker. I would direct my question to the Honourable Minister responsible for Workers Compensation. Has the Minister been informed that the former Director of Finance of the Workers Compensation Board stated in his report to the board, prior to leaving, that the board will continue to experience significant annual losses as a result of not collecting all of the premiums due?

MADAM SPEAKER: The Honourable Minister responsible for Workers Compensation. HON. H. HARAPIAK: Yes, Madam Speaker, we are aware that there are some premiums not being paid. Workers Compensation Board - overpayments at rate not necessary MR. A. KOVNATS: To the same Minister. Has the Minister been informed that the former Director of Finance, stated in his report to the board, prior to leaving, that he said that overpayments continue to happen at a rate which is not necessary? HON. H.

HARAPIAK: Madam Speaker, as I had mentioned earlier, we are going into the Estimates process and we will be discussing Workers Compensation. But I believe questions are being asked here on an internal report of the Workers Compensation . The Director of Finance left a report just before he left the employ of Workers Compensation . Yes, I am aware of the report. I have not dealt with it thoroughly. Workers Compensation Board - directive to not collect overpayments MR. A. KOVNATS: A final supplementary to the same Minister .

Has he been informed that the former Director of Finance of the Workers Compensation Board stated in his report to the board, prior to leaving, that the Minister informed that the board had passed a directive to instruct that Workers Compansation Board not to attempt to collect any of the overpayments? Was he informed? HON. H. HARAPIAK: Madam Speaker, that is not correct. The board makes every effort to collect assessments that have been attached to every corporation that exists in Manitoba. Workers Compensation Board - position offered to Chairman MADAM SPEAKER: The H:>nourable Member for Minnedosa. MR. D.

BLAKE: Madam Speaker, my question is to the Honourable Minister responsible for the Workers Compensation Board . Could the Minister confirm to the House that a position of employment outside of the board has been offered the chairman, Sonny Arrojado? MADAM SPEAKER: Would the honourable member repeat that question? You're not bringing information to the House and asking a Minister to confirm or deny, I hope? MR. D. BLAKE: I was asking the Minister if he could SOME HONOURABLE MEMBERS: Oh, oh! MADAM SPEAKER: Order please . I didn 't hear the question. MR. D.

BLAKE: I was asking the Minister if he could confirm to the House that a position of employment, .il outside of the Workers Compensation Board, had been .. offered to the former chairman. MADAM SPEAKER: Positions of employment in other areas are not within that particular Minister 's jurisdiction, unless it's dealing with positions within the Workers Compensation. MR. D. BLAKE: I wonder if he could confirm if the former chairman has been offered a position within the Workers Compensation Board. MADAM SPEAKER: The Honourable Minister responsible for Workers Compensation. HON. H.

HARAPIAK: Madam Speaker, the chairperson of the Workers Compensation Board is presently operating in her capacity . I'm not aware that she is looking for any other employment . I'm not aware of her being offered any other position. Workers Compensation Board employee - ~ position offered in Dept. of Labour ~ MR. D. BLAKE: I will direct this question to the Minister of Labour then. I wonder if he could advise the House whether or not Mr. Fleury, a member of the Workers Compensation Board, has been offered a position within the Department of Labour as a conciliator .

MADAM SPEAKER: The Honourable Minister of Labour. HON. A. MACKLING: Madam Speaker , normally I hear the Member for Minnedosa very clearly but there was some background noise here . I didn 't hear the last part of his question. MADAM SPEAKER: The Honourable Member for Minnedosa to repeat the question. MR. D. BLAKE: I'll repeat the question, Madam Speaker. 2898

Tuesday, 9 June, 1987 I asked the Minister of Labour if Mr. Fleury, a member of the Workers Compensation Board, had been offered a position as a conciliator with his department. HON. A. MACKLING: Madam Speaker , there is a competition, and I'm not aware whether the Honourable Member for Minnedosa or anyone else has entered the competition at this stage. Westman Women's Shelter - increase in funds MADAM SPEAKER: The Honourable Member for Arthur. MR. J. DOWNEY: Thank you , Madam Speaker. I have one question for the Minister of Economic Security. SOME HONOURABLE MEMBERS: Oh, oh! MADAM SPEAKER: Order please.

The Honourable Member for Arthur has the floor. MR. J. DOWNEY: Thank you, Madam Speaker. I have a question for the Minister responsible for Economic Security. I wonder if the Minister would quit playing cheap politics with the safety and lives of the women in the western part of the province. SOME HONOURABLE MEMBERS: Oh, oh! MADAM SPEAKER: Order, order please. As the honourable member well knows, he is not to question the integrity of other honourable members. The Honourable Member for Arthur with a question. MR. J.

DOWNEY: Madam Speaker, I wonder if the Minister of Economic Security would put the interests of the women in the Westman region , who have to use the women's shelter, ahead of his own political games that he plays . MADAM SPEAKER: Order please, order please. The question is out of order. Would you like to rephrase your question? The Honourable Member for Arthur. MR. J.

DOWNEY: Madam Speaker , I wonder if the Minister of Economic Security would tell this House that by agreement, the Federal Government support was lowered at the Westman shelter, an agreement which was entered into in 1984, and that his department is giving them a measly $15 ,000, and they were instructed not to ask for an increase because they wouldn't get any from his department. That, Madam Speaker , is the truth. MADAM SPEAKER: The Honourable Minister of Employment Services to answer the question. HON. L.

EVANS: It' s obvious, Madam Speaker, that the Honourable Member for Arthur is very sensitive about the fact that the Federal Conservative Government of Canada no longer supports the Westman Women's Shelter, nor do they support it in other parts of this province. The facts are, Madam Speaker , that it was this government that established the centre through the Department of Housing wh ich now pays for that building . The Department of Housing pays for that building, the Department of Community Services pays a grant, a reasonable grant, not my department.

In addition, we are prepared to pay reasonable per diems if the City of Brandon would be prepared to cooperate in order to finance this shelter. But, Madam Speaker, the facts are that this shelter was put in place by this government and indeed will be continued to be supported by this government in spite of the insensitivity of the Ottawa bureaucrats. MR. J.

DOWNEY: Madam Speaker , in view of the fact that there are six people who have to be paid and in view of the fact that this Minister puts a measly $15,000 into the Women 's Shelter in the Westman Region, will he increase it so they can provide the proper care and shelter for those people in need, without having to go with cap in hand to other sources? Will the province pick up their responsibility to look after those individuals? HON. L. EVANS: Madam Speaker, the Honourable Member for Arthur didn't listen to my previous statement or he chooses not to listen.

I indicated that the Department of Community Services provides the block funding, but that we provide , through our department and in cooperation with the City of Brandon, per diems. But the facts are the per diems that we have suggested are not being implemented by the City of Brandon and therefore we had ongoing discussions with the City of Brandon, asking them to pass on the per diems that we've suggested . If that were the case, I would suggest that shelter would be in a much better finan cial situation than it is today. MPIC - Tabling of Annual Report MADAM SPEAKER: The Honourable Member for Arthur. MR. J.

DOWNEY: Madam Speaker , I have a new question to the Minister of Finance . This morning in committee, we were told by the Auditor, Madam Speaker, that the report from the Manitoba Public Insurance Corporation had been given to him on June 4, a report which I believe the Legislature should have received from the Provincial Auditor, not the Minister of Finance. Why is the Minister of Finance not providing that report immediately to the Manitoba Legislature? What's in that report that he's afraid to show the public? MADAM SPEAKER: The Honourable Minister of Finance. HON. E. KOSTYRA: Thank you, Madam Speaker.

The answer to that question is exactly the same as I responded to the same member this morning in committee , and that answer is that the Minister of Finance, upon the request of the Minister responsible for the Manitoba Public Insurance Corporation , 2899

Tuesday, 9 June, 1987 reque ste d that the Provincial Audit or hold a special audit into the Manitoba Public Insurance Corporation , raising a number of questions for the Audi tor to address . That was done at the request of the government , Madam Speaker . The request that was made was made public and a copy of the transmittal letter to the Provincial Auditor was made public , so that the public and members opposite were aware of that request. That report has been recei ved , it was received last week .

As I indicated to members opposite, that report will be released to members opposite , to members of the public within the next seven to ten days, which will give ample opportunity for the members opposite to prepare for the committee that is still seized with the review of the Manitoba Public Insurance Corporation. This government is open to requests and is open with respect to the results of the special audit.

There is no legislative requirement that those repor ts be made public or be tabled in the Legislature, but it's our position as a government that those special audits ought to be tabled, and we will ensure that they are tabled and available for public debate , Madam Speaker . MADAM SPEAKER: The Honourable Member for Morris . MR. C. MANNESS: Madam Speaker, before I direct my question to the Minister of Energy and Mines, I too would like to declare my interest in the matter of the government purchasing shares or indeed the distribution system of Inter-City Gas .

I'm a material shareholder in that company, although my share total is very small. My question is to the Minister of Energy and Mines. It's been reported in the paper by some government spokesman that there would not be a large transfer of cash , indeed there would not be a cheque written for the ICG distribution system. My question then to the Minister of Energy -{Interjection)- I declared it, I declared it, there's no trouble. SOME HONOURABLE MEMBERS: Oh, oh! MR. D. BLAKE: I've got shares in the Royal Bank . I can ask questions about interest. MR. C. MANNESS: A ruling, Madam Speaker?

MADAM SPEAKER: Order please, order please. I took the matter under advisement of whether, even though a person declares their interest, they can still participate in discussion or be present while a matter is being discussed . SOME HONOURABLE MEMBERS: Oh, oh! MADAM SPEAKER: Order please , order please . This is rather a serious matter. Could members please come to order? The Honourable Attorney-General. HON. R. PENNER: I would not want , nor would anybody on this side and I'm sure anybody on that side, want anybody, inadvertently, to fall into conflict with the legislation .

It's my intention to ask legislative counsel to have a report available for all sides of the Hous e befor e the end of the day, because there are some areas of concern. For example , it has been suggested to me by legislative counsel, but I want that in writing for both sides of the House, that the mere fact that you don't have an interest of a size to inc lud e in the written declaration does not mean you don't potenti ally have a conflict of interest.

Nor is it clear to me, and I'm going to put it no further, that participating in question period directly on point, whether or not that is potentially a conflict of interest. I think it's up to the Member for Morris, but he should be aware of the pitfalls that are there and I wouldn't want him, out of respect for him, to fall into that trap . MADAM SPEAKER: The Honourable Memb er for Morris on the point of order? MR. C. MANNESS: No, Madam Speaker . MADAM SPEAKER: I would, just at this point while we're in question period , like to just read the one

section from the act , and I have still taken the matter under advisement. But for information of all members before I report back to the House, on

section 4(1)(

c) it says: "A member shall disclose the gene ral nature of the direct or indirect pecuniary interest or liability , (

d) withdraw from the meeting without voting or participating in this discussion , and refrain at all times from attempting to influence the matter," so that is the legislation under which we're operating and we are also in the process of checking with legislative counsel to bring a definitive answer on this question to the Chamber . Inter-City Gas - mortgage on sale to Gov't of Man. MR. C. MANNESS: Madam Speaker , my question to the Minister : Will Inter-City Gas be carrying the mortgage , therefore , of this sale to the Government of Manitoba? MADAM SPEAKER: The Honourable Minister of Energy . HON. W.

PARASIUK: Madam Speaker, as the Premier indicated, the negotiations are proceeding. I certainly can't comment on them publicly when they are proceeding . When the negotiations are complete, the material will be brought to the House for House discussion and review. Inter-City Gas - details available before Second Reading MR. C. MANNESS: My supplementary then to the Minister. Will the details of that purchase sale agreement , will they be available before Second Reading of this bill? HON. W. PARASIUK: I can't say. I can't put a specific timetable on the negotiations. I would hope that the 2900

Tuesday, 9 June, 1987 members on the other side wouldn't as well. I would hope that they would want these negotiations to be successfully concluded at a price that is fair to all parties, to in fact promote the public interest of lower costs of natural gas for all Manitoba consumers of natural gas. That is the issue , Madam Speaker - (Interjection)- When those negotiations are concluded, there would be a requi rement under The Loan Act to come before and provide that information to the Legislature , and that information will indeed be provided once the negotiations are completed.

Labour Management Review Committee - legislation receiving approval of MADAM SPEAKER: The Honourable Member for Brandon West. MR. J. McCRAE: Madam Speaker, my question is directed to the Minister of Labour. Yesterday , the Minister agreed to let me know what important legislation in the last five years has received the concurrence of the Labour Management Review Committee. MADAM SPEAKER: The Honourable Minister of Labour. HON. A.

MACKLING: Madam Speaker, I am given to understand the Labour Management Review Committee was brought into being in the Sixties, and I have asked staff to review the minutes and correspondence from that committee to confirm what specific legislative initiatives were identified in correspondence or minutes from that organization. That will take some time because the committee has been in being for over 20 years. So we will certainly look at that and we will give you that information in due course. Labour Management Review Committee - recommendations prior to bringing in legislation MR. J.

McCRAE: Madam Speaker, this Minister told us also that about two years ago, along with a whole lot of other matters, he left the matter of final offer selection in the hands of the Labour Management Review Committee. Then he introduced legislation on Friday. Did this Minister ask the Labour Management Review Committee for a report or their recommendations or their comments, specifically , on this legislation before he brought it in? A MEMBER: No, he just told them what he was doing. HON. A.

MACKLING: Madam Speaker, in questions I answered earlier, I did fully indicate in my response tha t the Labour Management Review Committee was requested by me about two years ago to review a number of items of concern, including final offer selection . I have not, to this date , received a report from the Labour Management Review Committee in respect to the matters that I referred to them . I did meet with them just prior to the introduction of the legislation and there was some concern evidenced to me that there should have been more consultation in respect to the introduction of this legislation.

I pointed out to them as I pointed out in this House that I, as Minister of Labour , do not feel I can make specific, formal demands on what is a consultative mechanism. They don 't receive any remuneration. They break bread together and share concerns together and, to the extent that they bring forth any specific recommendations , certainly any government will be happy to listen to them . But we don't make specif ic demands on them. Labour Management Review Committee - withdrawal of bill MR. J.

McCRAE: Madam Speaker , in view of the admission by this Minister that there has been no meaningful consultation respecting final contract selection, will the Minister now agree to withdraw the bill, engage in meaningful consultation and, by that, I don't mean consultation with Wilt Hudson and Bernard Christophe and Bruno Zimmer only? Then if there is support after all that consultation, that meaningful consultation, will the Minister reintroduce the bill at some later time? HON. A.

MACKLING: Madam Speaker , we 've heard members of Her Majesty's Loyal Opposition, certainly the Leader of the Opposition and others say that everything, every political decision must be prefaced, must be introduced after there has been an inquiry, after there has been kind of a referendum. There doesn't seem to be any endorsement of political will on the part of the Opposition.

We have looked at final otter selection for in excess of five years and we note a growing consensus in this province that strikes and lockouts should be avoided if it's possible, that there should be alternative mechanisms considered to avoid the trauma and the economic hurt that work stoppages incur. Therefore, we're proud to introduce this legislation, Madam Speaker. MADAM SPEAKER: The time for Oral Questions has expired .

INTRODUCTION OF GUESTS MADAM SPEAKER: May I direct the attention of honourable members to the gallery where we have 60 students from Grade 11 from the Louis Riel Collegiate under the direction of Mr. J . Morassutti. The school is located in the constituency of the Honourable Minister of Health . On behalf of all the members , we welcome you to the Legislature this afternoon. COMMITTEE CHANGES MADAM SPEAKER: The Honourable Member for Emerson . 2901

Tuesday, 9 June, 1987 MR. A. DRIEDGER: We have some committee changes. Under Statutory Regulations and Orders: Enns for Birt , and Mccrae for Ducharme . Under Municipal Affairs : Cummings for Ernst and Driedger for Ducharme. Just one point I want to make, if my speaker doesn't work properly, the Member for Pembina has the responsibility for that. MADAM SPEAKER: I'll take due note of that when the repair bill comes. ORDERS OF THE DAY HOUSE BUSINESS MADAM SPEAKER: The Honourable Government House Leader. HON. J.

COWAN: Madam Speaker, on a matter of House Business, this is just to confirm that, through agreement with the Opposition House Leader, tHe Standing Committee on Public Accounts will meet on Thursday, June 11 at 10:00 a.m . to continue on with its consideration of the report of the Provincial Auditor and Public Accounts . I move, Madam Speaker , seconded by the Minister of Finance, that Madam Speake r do now leave the Chair and the House resolve itself into a committee to consider of the Supply to be granted to Her Majesty.

MOTION presented and carried and the House resolved itself into a Committee to consider of the Supply to be granted to Her Majesty with the Honourable Member for Burrows in the Chair for the Manitoba Jobs Fund, and the Civil Service; and the Honourable Member for Lac du Bonnet in the Chair for the Department of Business Development and Tourism. CONCURRENT COMMITTEES OF SUPPLY SUPPLY - BUSINESS DEVELOPMENT AND TOURISM MR. CHAIRMAN, C. Baker: Committee, come to order. The Minister has a few statements. HON. M.

HEMPHILL: Well, I have a few answers that were taken as notice yesterday that I wanted to provide as quickly as possible. One was about the Reiss Fur Company and Robe rt D. Reiss Enterprises, were they the same company. The answer is no. There's a bit of additional information about what a few of them are and I'll provide that to the member. The question about Elizabeth Warbansky and the Ukrainian Arts and Crafts Ltd., who received a $1,000 contribution for the Design Assistance project, and I think there was a question, was she getting other money from other places, other departments .

The purpose of the grant from us was to provide and help them develop a company identity, a catalogue price list and packaging to expand marketing through direct selling through trade and gift shows. They 've also received some funding from Industry, Trade and Technology, from their Assist ance Program, to participate in several gift and trade shows, and the contribution for that was $4,103.00.

Also , in terms of the question of the Daerwood and what financial security there was, there was some question raised as to whether or not we actually indeed had the collateral of the personal home , and I have the Certificate of Title here that indicates that the Royal Bank of Canada has transferred the mortgage to Her Majesty the Queen for right of the Province of Manitoba. I'll give the Member for Portage la Prairie a copy of that.

I also just wanted to take a couple of minutes to read into the record some additional information on the question of bankruptcies, because I think we did have a discussion yesterday that suggested that some of the figures were not correct. I want to confirm that Manitoba has registered a total of 100 bankruptcies , an increase of one over the same period from January to March of last year. In '86, we recorded 282 business bankruptcies, which was 42 business bankruptcies less than in 1985 , which was down 15 percent . Our long-term average is 80 .9 per thousand business firms, compared to Canada 's 101.

I just wanted to read those into the record. (lnterjection)- For 10,000 - I thought I said that. MR. CHAIRMAN: The Member for Portage. MR. E. CONNERY: Yes, Mr. Chairman , I have to agree. The research people were given the wrong information by the person who they were talking to and that person • inadvertently was giving her the stats for the two provinces. So it was an error. I apologize for the error because I don 't like inaccurate records. We do have some other ones that we want to clear · up with the deputy to make sure. There is still some cloud as to - we want to make sure we're on the same thing. HON. M.

HEMPHILL: Fine . MR. E. CONNERY: Going through one of the O/C 's back awhile , there was a Statistics Agreement with the · Federal Government that was signed by the previous deputy. What types of statistics were these going to do? I'm , concerned that we don't have enough stat istics . So : could we have an explanation on that agreement? HON. M. HEMPHILL: This is a three-year agreement that we have with Canada where Manitoba is providing , over the period of the three years , $90,000 - $20,000 , $35,000 and $35,000 .00. We get the information from , Statistics Canada.

The statistics and information is going to help businesses that are in operation and provide benefit • to business as well as to government. The information will be both on Canada and on Manitoba statistics. It will provide us information on productivity, on sales per square foot , on cost factors. I understand that about 30 percent of the information is in right now from Stats Canada. We expect the rest of the information to be provided to us over the period of the next two or three months , and there has been 2902

Tuesday, 9 June, 1987 already some information made available to the businesses . The bulk of it is not in or compiled yet though . MR. E. CONNERY: I gather none of this is going to target what is being imported from foreign countries or what is being imported from other provinces then? Those were the stats that I was looking for. HON. M. HEMPHIL'i<'L: No, Mr. Chairman. MR. E. CONNERY: In the RDC's, is there equal funding to all RDC's or is there preferential funding for some of the RDC's? HON. M. HEMPHILL: Mr. Chairman , there are a number of criteria that are applied . The grants are not totally equal.

They all get an operating grant that is exactly the same, which is $40,000.00. After that, there are some variations that might depend on the manager 's seniority, for instance, in terms of salary. There is some funding for travel in some of the RDC's. My recollection - I don 't have it here in front of me - but there might be a range of about $10,000.00 . MR. E. CONNERY: Is there any figure for, say, every dollar the RDC's raise on their own through their own appropriations, that there is a government dollar to match that? HON. M. HEMPHILL: No, Mr. Chairman .

They get the operating grant regardless of any funding activities . MR. E. CONNERY: Is that a change in the last two or three years? HON. M. HEMPHILL: No. MR. E. CONNERY: Well, I guess I'll have to do some more research . I think there was some different rationale between different regions where there was a one to one or a one-and-a-half to one. I've seen documentation on it, but I don't have it with me. HON. M. HEMPHILL: Mr. Chairman, we're trying to clarify the discrepancy in understanding.

It could be related to the fact that the municipalities provide some funding to them, based on a per capita grant that is over and above what they get from us. MR. E. CONNERY: Outside of the RDC funding, if businesses are looking to locate in certain areas, are there some areas, for whatever reasons the government wants, that are preferential areas and would get more assistance than if they went to another area in the province? HON. M. HEMPHILL: In our department, there is no criteria .

In IT and T, in their development agreements, there is an expressed desire to have development in the rural areas, which the Member for Portage la Prairie will appreciatE!, but not in our department, although you might suggest that some of our resources are focused on particular areas. I mentioned before the community development , the Northern and 'remote and the core . MR. E. CONNERY: In O/C 125386, there was $14 ,000 to Gimli Harbour Park Development Corporation . HON. M. HEMPHILL: Can you give us a bit more detail on the Order-in-Council or do you know how much it is?

We're into Tourism now so we're really flipping . MR. E. CONNERY: Is it Tourism? Okay. Then we'll wait till we get into Tourism . HON. M. HEMPHILL: Okay, we'll get it when we get there . MR. CHAIRMAN: Any more questions? Okay, we'll pass and , if they want to ask questions , we'll do it under the Minister 's Salary. 2.(a)(1)- pass; 2.(a)(2)-pass. Resolution No. 24: Resolved that there be granted to Her Majesty a sum not exceeding $3,464, 100 for Business Development and Tourism, Business Development , for the fiscal year ending the 31st day of March, 1988-pass . We now begin No. 3. Tourism : (a)

(1) Salaries . HON. M. HEMPHILL: Mr. Chairman , I have decided to forego what might be a traditional opening statement and simply talk about the major success that we have on our hands with the conference, the meeting, Planners International. Because I think what is happening there is very important to the Tourism industry, very important to Manitoba and Manitoba's economy, and the potential grow1h for the increased economic impact in the future .

We have a 1,000 - over 1,000 - delegates here, who are key convention planners, buyers and key people in the States - all from the United States - who make recommendations on conventions to major groups and organizations. Their feelings about Manitoba's ability to handle an international calibre event like this is very, very important , because they are going to be ambassadors and promotors for Manitoba when they go back home . I think that it's fair to say that we have a smashing success on our hands, and that we're knocking their socks off, to put it bluntly .

In every category, they are raving about Manitoba's ability in terms of organization, in terms of service, in terms of entertainment , in ·terms of hospitality . -Our accommodation is superb.- (Interjection)- Mr. Chairman , could they keep it down just a little? All of the delegates have been saying that they have seldom, if ever, seen a conference that has gone as well , has been as well-planned and as superbly executed . This is very .important for us. I mean one of the reasons of course is, as the Member for Portage la Prairie is constantly saying, that there has been a drop and a decline in U.

S. overnight visitors and that is true . It's a market that we want to improve; it's a market that we want to go after. We've now got a 1,000 promoters - I believe that - in the States promoting Winnipeg as one of the best places that they could possibly consider bringing a major convention . We can compete on the world stage. 2903

1\iesc.tay,, 9 June; 1~117 We can handle the highest level of international•calibre convention and we've shown our stuff. We expect to get $1 million out of this in direct sales, but the promotional activities that we expect to come out as a result of this are worth pure gold and can't be bougM. I have been talking personally to · as many of the .delegates as possible, hundreds of them . I've asked each ofthem how they're enjoying this day; how it's going, whether they're going to come back and whether they're going to recommend it as a place for people in their city or country to visit.

The answer has been, absolutely yes . Yes, we want to come back; we're going to come back and bring friends . We want to spend more time and we definitely are going to recommend this as one of the top places to hold major international conventions . Sci I think that's something that 's very positive . I think it's very important for us, and I think · it recognizes the cooperative effort that this province has been noted for, between the private sector, between the tourism industry and between the government.

What we pulled off last · night was really only done because of the here::ulean effort put forward by everybody. They're all to be commended, and I think it's a very good example of what we can expect in terms of our industry promoting and making people realize and believe that the tourism industry has tremendous potential in the Province of Manitoba. So I'm delighted as Minister of Tourism; the Industry is thrilled . The convention delegates are absolutely delighted with the whole program. I think that bodes very well for us and, hopefully in ·the long run , for our U.S. overnight tourist statistics .

Thank you, Mr. Chairman . MR. E. CONNERY: If I had my way, Mr. Chairman, I would immediately hire the Minister from her job as the Minister of Tourism and elevate her to a tourism ambassador . I think that's where the Minister's talent shines , and I must say that at meetings where I have been at, she augurs · well for Manitoba in her presentation. Last year, also in her opening remarks, she spoke glowingly of the tourism industry and with real optimism about the coming year. Of course, one thing is to have optimism and enthusiasm, but the second thing is to make it come to fruition . Last year, . Mr.

Chairman , she was forecasting an increase in the U.S. tourists of 4 percent to 5 percent . In fact , we · had a decline ·of 7. 7 percent of Americans entering 'Manitoba at border crossings . We have just completed 12 consecutive months of adecline in foreign visitors . We are also the only province to have a decline in foreign visitors in 1986.

Why were we down 7.7 percent while others were up: ou·ebec, 6. 7 percent ; Ontario, 5 percent; Saskatchewan , 6.5 percent; Alberta, 7.7 percent; and B.C., because of Expo , of course, we have to ignore it, but it was .up 80.6 percent, but that was a little bit different situation. At first, this Minister feebly alibied her way through the decreases and then changed her strategy to saying it was an insignificant part of our tourist trade and that was very disappointing because the foreign visitor is not an insignificant part .

We need those foreign dollars desperately, but this Minister doesn't seem to comprehend the significance of it to our economy. We had a $110 million tourist trade deficit in 1985, of a foreign tou rist deficit, and I'm sure it would be much higher in 1986 . -~ Manitoba, in my .estimation, is an island of embarrassment and shame within the tourist sector . You know, we almost. become the laughing stock of the country if we look at those tourist records . We also have an $80 million deficit in domestic travel.

So we have to address ourselves to these stats that we are realiy not doing what we want to do in the tourist industry. I sincere ly hope that Rendezvous Canada and Meeting Planners lnternation ·a1 have a positive effect on us in 1987 and subsequent years to come. If nothing else, I'm sure, along with the shift in the month that Easter fell, which was one alibi that was pretty weak, these corwention sales people will have a positive effect on May and June on the numbers of foreign visitors and I mentioned to staff earlier - methinks, I lost my 12 consecutive months is going to be the end of the record .

We also have to recognize that we have over $80 • million, as I said, in domestic tourist travel deficit . So l Manitoba 's total travel deficit is in the area of $200 million and this is $200 million that is going out of Manitoba. I don't know if we'll ever bring it around to a break-even position . We have to do something to reverse the horrendous numbers that we have. , The Minister told us that Manitobans were taking up •j the slack and I was forced to believe it for awhile . But !1 once I had assembled the statistics, it was obvious that the Minister had misled the Legislature . HON. M.

HEMPHILL: . . . the statistics. MR. E. CONNERY: I got the statistics. HON. M. HEMPHILL: ... haven 't been so good lately. MR. E. CONNERY: It would be a delightful experience ii just once this Minister would admit there was a problem and then take appropriate action to correct the problem . But no, she waves her arms and says everything is going to be wonderful , but problems will • never be rectified until one recognizes that there is a ~ problem .

Once that is accepted - and maybe she does behind closed doors, and I guess in the political arena you don't like to admit - but I think, once ·in awhile, it might h1;ilp. If indeed Manitobans were touring more , as I asked the Minister in the House, what were they doing? Accommodation sales were down . Restaurant sales were up less than inflation. Park usage was down and retail sales are slow and below the national level. So I asked the Minister to show me her statistics that bear out the statement that Manitobans ~ re touring more in Manitoba and maybe we can come to an agreement.

A study performed t;,y the Minister's department in December, 1984, showed many areas where Winnipeg and Manitoba .were at a disadvantage with the provinces and stats around it. We have a study and it showed some of the problems that we have. It said, in terms of price competitiveness with regard to the food and beverage -sector , Winnipeg . can be seen as one of the least competitive jurisdictions and of course, Mr. '2904

Tuesday, 9 June, 1987 Chairman, the Minister has to recognize that it is the policies of other departments of government that contribute to this high cost. The minimum wage that we discussed the other day increases the price of food within Manitoba , which they say, our food costs are too high. The taxes, the 7 percent tax on our food and all the other items all raised the costs so Manitoba is not competitive. It is evident that all factors considered , North Dakota is clearly the lowest jurisdi ct ion within Manitoba's primary market area. So we're trying to bring them up here and there is some resista nce.

Minnesota in many respects can be considered as the next-lowest cost centre within this survey . Its liquor sales tax , 8.5 per cent and corporate income tax is second only to North Dakota. Also, there is no heal th and education levy per se and the effect of minimum wage with the exclusion of tip differential for 268 over over 18 years of age is the lowest in the survey area. This is put ou t by the Department of Business Development and Tourism .

They recognize, they look at and I know the staff recognized the problems th at this health and education tax puts on this province when we are selling, whether it's business or whether we're selling tourism. so that the department themselves recogni ze these problems. So it says, to c onclude , Winnipeg is not very competitive , in the terms of price of restaurant and hotel meals. Then we have the food people , the food •and restaurant. These are the free-standing , not including hotels, show some of the stats that they've had .

It's in the area of licensed restaurants , where they've take n a sign ificant decline of in around 15 percent, contrary to the national average. The nationa l average for licensed, unlicensed and take-out restaurants has shown a very similar increase , where in Manitoba we see the licensed restaurants taking a severe decrease and the unlicensed and take out showing the large increase in food.

So when we talk about alcohol , then we can see why it is that Manitoba has one of the higher alcohol prices in the area , but when you look at Manitoba's primary tourist area - we take in North Dakota and Minnesota - Manitoba's alcohol prices are very high . Winnipeg's average price for recreation and entertainment items was one of the lowest among the 10 cities, while that for miscellaneous items was the highest. So everything that we have in Manitoba is not bad, so there are some good parts.

The fact that the tax on domestic beer is only 6 percent in Manitoba is the underlying factor and of course that's changed since. This is a 1984 study. The under lying factor by Manitobans can be said to be competitiv e with the rest of its primary market. The tax on liquor in Manitoba puts a damper on the province's competitiveness, as this is amongst the highest sales tax . Discounts of the volume sales of liquor are a most crucial cost factor in the price of alcohol. Manitoba offers no discounts, while other areas do. They go on to list the amount of discounts that are there.

This illustrates why Manitoba is so high. It goes on to say that it is fair to say that hospitality 'operators in North Dakota and Minnesota can purchase their liquor at prices considerably below those found in Manitoba. It's in around the area of a half or less the cost for alcohol to the restaurants and lounges that we have to pay in Manitoba. It's a cultural shock when an American , who buys his drinks at $1 .00 a shot in North Dakota , Minnesota , comes up here and has to pay $3 .50 and $4.00, and you can see why. There's a list showing the different things.

So that shows you some of the problems that we have, and the Minister must have this. It was her department that put it out. So studies show that Americans are turned off by the high cost of alcohol, but also by the high cost of gasoline. Once again, when they have their first fill up at a Canadian gas station, it really is a cultural shock to find out what it's going to cost th em in dollars. Mr. Chairman, Manitoba does have a lot to offer tourists.

We have a wide range of terrain from the flat prairies. the medium-sized mount ains. mountain ranges, the Precambrian shield, numerous fishing lakes, naturalist areas, historical sites, sporting events , cultural festivals . entertainment spectaculars - you name it, we have it. But, Mr. Chairman , this Minister can't sell it. Let's take a look at the Vacation Planner and, you know , this was one of the - I hate to say it was one of the laughing things we had in the Legislature, but it was one that I hope that we don't see again .

I don 't know who did it, who was commissioned to do it, but it really leaves a lot to be desired in the sense and, you know , the Minister said, well , it's just to whet your appetite. This may be. But if they stop at a place and they pick this up and there is no other material around, they're almost going to take this as being what Manitoba is. We talked about the highways that are missing, Highway 10 in the Brandon area that the Peace Gardens are on , Highway 10 through certain areas.

There is just one incident after the other and, of course, the ferry at Treesbank is not a glowing one and it was good for some levity at the end of a long week. But for the people at Fairford and Gypsumville, it says in here, the last place you can get food and lodging is at Moosehorn. You can imagine the dismay of the people at Fairford. So I think when we do put these out , even though they 're just to whet the appetite , they should be somewhat more accurate. I would think that this would add to people coming in.

I've had many calls on this particular brochure from people who were very irate, and I guess the people at Fairford were probably the most irate, and I think rightly so. So it's an area that she could look at. I think we need to take a look at our media buy and, once again, I think we could get into some discrepancy with statistics here . I'm not an expert. There are vario us means of advertising, promotion and media buy. I'm told that Saskatchewan has a $4 million budget, PEI $775,000 and Manitoba has $700 ,000.00.

Now I don' t know if these statistics will be challenged and , if they 're not right, I would look for the right ones. (Mr. Deputy Chairman, D. Scott, in Chair.) Last year, the Minister said in Hansard, when we discussed this media buy, she said it was one of the areas that she was concerned about and that she would take it to the Cabinet. I don 't see an increase in the media buy. So, if she did take it to Cabinet, then the Minister is not having the persuasion that she should have in Cabinet . 2905

Tuesday, 9 June, 1987 Last year, we discussed the lack of information booths and the quality of these booths. She said that there will be some announcements to do with booths and upgrading, and I hope the Minister will be able to announce some plans today as to what's going to happen. The Minister was given a presentation by a company , and I didn 't bring it with me, it's Green-something, Greenspan or whatever that had these booths and the Minister had the presentation. They had this booth and they showed the different ways they were going to advertise. HON. M. HEMPHILL: Like information . MR. E.

CONNERY: Yes, an information booth, and it wasn't going to cost the government any money, but it would make money for the operator and I think that's great. Do it for the province for nothing and somebody makes a few bucks , as long as it's doing the job well. That's the decree that they're doing the right sort of promotion. So I would like the Minister's views on that . MR. DEPUTY CHAIRMAN: Madam Minister. MR. E. CONNERY: No, I'm not . . . HON. M. HEMPHILL: Is he finished? He just took a breath. MR. DEPUTY CHAIRMAN: You're not finished? I'm sorry, I mistook that.

A breath for a pause, waiting , maybe it's a pregnant pause. The Member for Portage la Prairie. MR. E. CONNERY: The quality in the imagination of the brochures, I would like to see us do some upgrading . I think some of them this year, there was some move in that direction. Last year, when I went to Alberta, I stopped at the Saskatchewan booths and the Alberta booths, and I must say that the Saskatchewan booths really impressed me. They were extremely well done, the material. They had tear offs to detour people for a day.

If you're going up Highway 16, they had little tear offs and they would show you what you would see and bring you back to Highway 16, delaying the tourists another day and just getting a few more dollars out of them. Personally, I think we could take a look at what Saskatchewan is doing. I think they're doing some things well . I think along the highways like 1, 10, 16, 75, the major arteries, there are no pull-offs with large signs and maps to show tourists what might be discovered by taking a detour and therefore keeping them for one or two days longer.

Saskatchewan have these pull-offs with a large sign which show you - and I suggested to the Minister last year - 1 and 16 just west of Portage, where we could show them where they could go by going up to Clear Lake and around and, if they wanted to come back by Trans-Canada, they could or they could go on to Saskatoon and back down. We would detour them around and get more tourist dollars out of them. I find these maps very interesting. If I'm a tourist with no set deadline , we will look for something to do but you've got to have something to tell you it's coming up.

I think we missed an opportunity to show the travellers to Expo what Manitoba has to offer. We know that there's a high traffic trade down the Trans-Canada Highway , but we chose not to build a pavilion at Expo . Are we trying to keep Manitoba to ourselves? It would almost appear that way. There was a letter that I would like to read from an individual and it was just some of the concerns that this individual had. He's with the tourist group. He's quite an involved person and he listed just a few of the concerns that he had.

The first one, the first concern was poor highway signs make it difficult to find the way. Poor highways make it difficult to travel and , of course , that's another one of our problems with the travel industry. Poor wayside parks and the great distance between rest areas; he was unhappy again with the Vacation Planner. It doesn't show the highways to Gillam, Snow Lake or Norway House. Then he had some other issues that were more related to the particular area that he's in. Mr. Chairman, highways are not a priority with this government and , because of this, remote areas will suffer.

The North will suffer, but the most tragic highway in Manitoba is Highway 75. Mr. Chairman, this is a killer highway. It's killing the tourist trade from the United States but, more drastically, it's killing Manitobans who travel it. This is one of the main arteries for bringing the people in on our primary target area. When you get people coming up 1-29 and then hitting Highway 75, at the rate they're going, it's going to take something like 20 years to do the twinning of Highway 75.

So we have to pressure the Minister of Highways to increase the Highways budget first of all, and put some priorities on to Highway 75. I think we could have had a priority by not building this highway int o Hecla Island at this point because, if we don 't get people into Winnipeg, we're not going to get them up to Hecla Island. I have a letter here from a person who came to Manitoba and this individual - I want to read the letter; it's very short. ''I'm a U.S. tourist from Minneap olis on a visit to Winnipeg.

A few days ago, I saw a news item on television saying that your tourist people are planning a campaign to promote tourism. The campaign is aimed primarily at the U.S. market. About 95 percent of the American tourists who visit here never come back a second time . Here are some of the reasons why : poor roads, high gasoline prices, expensive accommodation, high food prices and exorbitant liquor prices . Add to all this the high sales tax, and you're killing the goose that laid the golden egg". I'm sure the Minister has read this one; it was in the paper.

His name is signed here and he's from Minneapolis, Minnesota . One of the concerns that I have, when the Minister - and I think the Minister needs to spend more time at conventions and among the people who she is representing as Business and Tourism Minister. The Minister was not up at Hecla Island and there was no reason for the Minister not to be.- (Interjection)- Well, she was. She flew in for the dinner. HON. M. HEMPHILL: That's all I had permission to be away for. 2906

Tuesday, 9 June, 1987 MR. E. CONNERY: Well, Mr. Chairman, I hate to say this but the Minister is misleading the record because the Minister talked to me the previous week in the House and asked what my intentions were with the convention at Hecla Island. I said I was going up Sunday and I was staying right through until the end of the convention. If I changed my plans, I would let her know. I wouldn't leave her hung without a pair, because she did not have an official pair as for the First Ministers' Conference. But in the sense that I was going and staying - and the Minister knew this - she had a pair.

There was no reason for the Minister not to have been at that convention. HON. M. HEMPHILL: That's not a pair, that's not a pair. MR. CHAIRMAN: Order please, order please. The Member for Portage. MR. E. CONNERY: Should I let you off the hook? Okay, I'll let you off the hook, I won't read it into the record. But that's not fair ball, because the Minister - I told her that and I was not paired with anybody else, and I wouldn 't have been paired. I was disappointed that the Minister had an individual tell people at events that she couldn't go to Hecla because she wasn't paired.

So that's the sort of misinformation that I don't think we should have happening. The Minister should have been there, she could have been there and there was no reason for her not to be there. Mr. Chairman, those are my opening remarks. Just one other area though that I would like to say with the planners who are here, I didn't realize that they were also buyers and I'm pleased to hear - I thought they were more or less arranging meetings . I'm pleased that they are actually planning conventions and selling the areas that they're going to.

I'm sure with that kind of a number with Rendezvous Canada that Manitoba should , in the next year or two, experience some good tourist stats. We hope so because we blew it at Expo where we really should have had a pavilion to sell Manitoba . I hope that these other events - and I hope it was good management that got them here, not totally good luck, because getting conventions of this kind don't just come by accident. So I will compliment the staff for the hard work that they did in getting these two major events here. I know that the Minister does have a good staff.

Part of the problem is the direction that the Minister gives and sometimes it's the direction that the Minister is given from Cabinet that she has to give to staff. So they have to live within the parameters of what the government wants to do. Thank you. HON. M. HEMPHILL: Mr. Chairman, I think it might be convenient, since the Member for Portage la Prairie raised quite a number of points, and some of them I can answer fair ly quickly , that rather than have them have to come up again , I might give fairly quick answers to some of them right now. We did get an increase in the advertising budget.

It was $100 ,000 that is going into a media campaign. We've always said that we would like more money in advertising for tourism; every province I guess in the country would. I think what we're trying to do is clear. We're trying to get the best bang for buck by having our advertising be cooperative advertising between the industry, between ourselves and between the Federal Government. We're getting much more mileage for the advertising program there. I think we have to continue that.

The Member for Portage la Prairie is one of the first people to say that we have to recognize the importance of the private sector . We have to involve the private sector and we have to use private sector money and not public money whenever we can. This is a clear example of where we've been very successful in tapping, and I think we have to do more. More work and more talking to the industry to make sure that they understand how important it is that they advertise or share advertising with us - that we're all out there together . So that's one of the areas.

The Greenspan Information Booth was a very interesting presentation and you're quite right that they would set them up and it would be profit-making . We have no quarrel with that. We were very interested in the project. I think the meeting was held between myself , the Minister of Highways, and the Minister of Natural Resources. It had a lot of appeal and we thought it had considerable potential.

It's my understanding at meetings that we left it that we were very interested in pursuing it, and that it has been left with the firm and with the private sector to continue developing and bring back to us for actual consideration. I think if you check with them , you'll find that at that meeting they got a very positive response. We said, it has potential, we're willing to look at it.

In some cases like this where we're clearly having some difficulty with the financial resources setting up information centres throughout the province in all the places we'd like to have them, this may be an alternative way of getting good information available, and we certainly wouldn't rule it out. But to my knowledge, they haven't followed up and explored it. I guess Highway 75, we all like our, sort of, favorite whipping boys and Highway 75 certainly gets more than its share.

But an interesting statistic shows us that the traffic from the U.S. has increased 10 percent, which is an increase over most of the other provinces. That was last year and the highway isn't any different really, relatively speaking, now than it was last year. So in 1985 our traffic from the U.S. increased nearly 10 percent, a greater increase than most other - (lnterjection)-'85 . Okay, it was in'85. The highway condition actually has not changed that much either in the one year or tile two years previously . In Fort Frances, where the highway is terrible, they've had a 20 percent increase in U.S. traffic.

So I think that to be fair we have to look at all of the factors and there may be a number of reasons. I think we should try to find out why when the traffic is down , if it is down , what the reasons are, but not to try and suggest that it's going to be an easy solution like "a highway," putting millions of dollars into a highway. I don't think there will be any simple solutions like that. 2907 I just want, for the record, to make sure that I reiterate again the point that I've always made about U.S. overnight travel. I have never said that it was not

Tuesday, 9 June, 1987 important. What I was trying to do -(Interjection)- no. Let me explain. What I was trying to do, because I did say that it was a relatively small part of our market and that, in terms of the money that was coming in, I think the U.S. overnight market is out of a total revenue base of about $79 million. Our Manitoba and domestic market is about four hundred and fifty. So I was just pointing out the relative size of the revenue base of the market.

I said at the time that all markets were important, even the smaller ones like this and we wanted to find out why, and we wanted to do whatever could be done to improve it. What I was trying to do was off-set what I believed was an exaggerated point being made by the Member for Portage La Prairie where the suggestion -(Interjection)- just slightly exaggerated, slightly - being made by the Member for Portage la Prairie was , to me, giving the image that the whole tourism industry was in trouble and I wanted to get a balance in there. So I ho'pe that makes my position clear; that is an important market for us.

I think that the work that was done - and I'm glad the Member for Portage la Prairie recognized it. That was four years of work by the industry and by the government in the department to get MPI here . They really had to show their stuff. They were in an incredibly competitive market and would not have gotten it had they not produced what was needed and put on a fabulous show in Boston , I think, which was the icing on the cake that brought them up here . So recognizing the work that went in to bring MPI up here I think is an indication that we recognize the U.S. market as a very important one .

We don't have millions of dollars to go out there and advertise in sophisticated , very expensive television advertising. We have to target it and we have to use what we can and this is one of our greatest potential - I think certainly a year or two, or a couple of years down the road - for increasing the U.S. market of anything we could do with much larger amounts of money required.

Highways, there has been a move in the last five or six months to have a committee or an interdepartmental committee meeting between the Department of Highways and ourselves and Natural Resources where we have been meeting together and talking about the question of signage, because we recognize it's an important one . The signage could be better and we're trying to work on it so that the signage that's being done in the different departments, that everybody recognizes the use of it, the utilization and the importance of it for the tourism industry . So we're trying to improve in that area.

The Vacation Planner , I don 't know what the Member for Portage la Prairie does except stay awake every night until about three o'clock in the morning reading these things . I think we'll hire him as a proofreader , if he needs a part-time job in the next Session . I want to make a couple of points. One is that when they're given that - and we said it's what they call a lure piece - but they should never be given that in isolation. When we market it, we're letting people know at all the information centres and booths, people know that it's a package and that this will just give them a sense of what is available.

It was never intended - it's just to give them an idea to stimulate their curiosity , their interest and their excitement. I think on those grounds it does that. It doesn't give them every piece of information they need about every highway and every ferry and all of the other relevant things, but they should be informed that along with that , if that attracts their interest, go the other pieces that give them the detailed information that they would require, depending on what it is they want. Fishing, accommodation and facilities, the details are in there.

Now having said that, I also want to recognize that while mistakes can be made and are made, and I think it was brought to my attention that previous ly, I think when the Conservative Government was in, they had the Trout Festival up in Flin Flon, just a slight deviation . Is that accurate? So mistakes can be made.

I want to ind icate to the Member for Portage la Prairie though that I have some concerns with the numbers in this issue and that we have set up a process whereby there will be an additional - in some cases, we accepted information that came from the regional tourism areas where they had the information in their brochures and we simply lifted it out and put it in our material. Clearly the onus is on us to check every piece of information that we're putting in, regardless of where it's coming from. We've set up a process of monitoring this so that we hope it won't happen in the future.

I think there has been a little bit too much, and it clearly needs some additional attention by our department in this area. So I want to recognize that and say that we've instituted a procedure to do that, I believe. There is only one other thing that I want to do that I think is important to do at this point and that is read very quickly - it won't take me long - some of the positive statistics, to answer some of the questions raised by the Member for Portage la Prairie, and simply to get a few of the posit ive ones on the record.

We are talking about the domestic and the Manitob a market, which is and probably will continue to be our best and our highest revenue and most important market. The total trips in Manitoba are up 20 percent. Manitoba day trips are up 43 percent ; Manitoba overnight tri ps up 7 percent ; other Canadians entering Manitoba up 8 percent; other Canadian trips destined to Manitoba 23 percent; U.S. visitors to Manitoba by air is up 2 percent; total tourist expenditures up 15 percent; Manitoba expenditures up 16 percent ; other Canadian expenditures up 24 percent.

Now, I want to talk about restaurants.- (lnterjection)- 1 hope so. I want to talk about restaurants because this was an interesting point. In most cases , total restaurant sales are up 3.3 percent , but take-out restaurant sales are up 22 percent, unlicensed restaurant sales up 6 and cabaret sales up 45 percent.

Now , while the Member for Portage la Prairie made mention of our high liquor prices and indicated that he thought that perhaps was solely responsible for the drop in licensed restaurant revenue increases, I think we have to recognize that there are some lifestyle changes here that are clearly evident in the statistics , because peopl e are going for take-out restaur ants for two reasons. One, they're fast, and we're into, you know, let's do thing s immediately , no time, and we're into "chea per." They 're going for food.

They're eating out a lot more and they're going to places with their families where it is not as expensive. That's a lifestyle change. 2908

Tuesday, 9 June, 1987 The other lifestyle change is cabarets. Cabarets are up 45 percent. Cabarets are taking away clearly some of the activity that would be going perhaps to some of those othe r facilities, licensed restaurants. I'll just say, Winnipeg convention delegates up 4 percent; Winnipeg convention delegate spending up 9 percent; provincial camping permit sales up 4 percent; park entrance permit sales up 10 percent.

There is a lot of good news and, while we're looking at the one sector that is causing us problems and causing all of us concerns, the U.S. overnight traveller, let's recognize that in many other areas, the percentages are as good or ahead of any others in the country. MR. CHAIRMAN: The Honourable Member for Portage la Prairie. MR. E. CONNERY: I guess I'll start at the bottom, at the end. The Minister says campsites are up, the use of campsites, and yet when we're in Natural Resources, the Minister said for the second year in a row the use of the campgrounds was done .

Now somewhere along the line, there is a conflict. That's in Hansard and it's on the record that the Minister of Natural Resources said the use of campgrounds was down . So where that comes from ... The numbers of trips within Manitoba , how do we know how many people are travelling? If I'm travelling down the road in Manitoba, how do you ascertain the number of trips within Manitoba and whether they're a tourist or whether they're a business statistic or not? HON. M. HEMPHILL: The statistics we use for that come from the Canadian Travel Survey, and it's 50 miles or more.

I just want to make the point about the park, the difference there. My staff inform me that was the information we got from Parks, but this is one of those areas where we will want to check out the discrepancies between what we have or believe we've been given and what you believe came through the Natural Resources Estimates. So we'll check that out. MR. E. CONNERY: There's a Canadian Travel - what do they call it? The Canadian Travel ... HON. M. HEMPHILL: The Canadian Travel Survey. MR. E. CONNERY: Survey . Has it, for 1986, been completed? HON. M. HEMPHILL: We have the data on trips for 1986.

We have the trips and about three-quarters of the expenditures. We haven't got the total expenditures. MR. E. CONNERY: Is the survey in printed form? HON. M. HEMPHILL: No. MR. E CONNERY: Well, how did we obtain the statistics if it's not in pr int ed form? Are they available in what way? HON. M. HEMPHILL: It's a computer output from Stats Canada. We expect it will be in printed form, available for the public, in about six months. MR. E. CONNERY: Have they started doing this survey more often? They were only doing it every second year at one time. Are they doing it every year now? HON. M.

HEMPHILL: Every second year. MR. E. CONNERY: So the'85 and '86 stats will be in this particular survey? HON. M. HEMPHILL: Yes. MR. E. CONNERY: How do they determine - now you say somebody travelling within 50 miles is a tourist, you say? That 's the definition of a tourist? HON. M. HEMPHILL: No, it's a trip . You asked how we determine trips. MR. E. CONNERY: Okay then , when they're doing this survey, and these numbers , is it random counts that they 're doing? How do they determine that more people are travelling within Manitoba? HON. M.

HEMPHILL: It's done by sample and projection, same as the labour force statistics. It's the same basis as the labour force statistics. MR. E. CONNERY: When they do a sample , is somebody sitting by the side of the road doing a visual count? I want to know how it's done. HON. M. HEMPHILL: I'll set up a luncheon with Neil for you. Can Neil buy you lunch someday? MR. E. CONNERY: I'm from Missouri. A MEMBER: No, you're not; you're from Portage. MR. E. CONNERY: I used to come from Missouri. HON. M. HEMPHILL: We'll even buy lunch. A random sample of individual interviews. MR. E.

CONNERY: Well, you've got to convince me how you got numbers by random sample interviews. Explain a random sample interview. HON. M. HEMPHILL: A random sample is a very legitimate way to get statistics because it's often most frequently used because you can't do the whole population. MR. E. CONNERY: I want to know what a random sample is. Are they taking an intersection every two weeks and they do it every year every so often? HON. M. HEMPHILL: I've been informed that we select 2,500 people in Manitoba at random and they are interviewed about their travel habits.

I have also been advised to inform you that the invitation does stand, that any time you want detailed information about how our statistical people compile all this data , we'd be quite happy to set up a meeting for you . MR. E. CONNERY: I think I'll accept that invitation and maybe Neil and I can spend a day or two to go over stats. I maintain .. . 2909

Tuesday, 9 June, 1987 HON. M. HEMPHILL: Half-a-day. MR. E. CONNERY: . . . your accommodations list, three out of four quarters being down in the accommodations, so I mean I don't know how we can argue that factor . HON. M. HEMPHILL: Right. MR. E. CONNERY: The retail sales aren't doing well in there. The Restaurant and Food Association, which does most of the food in Manitoba outside of the hotels , is only up about 2 percent by my calculations - I did it quickly - which is less than inflation - you said three - but still around the inflation rates which means there's no increase in that at all.

And with campgrounds we're going to try to find out if we can justify those statistics, that really there were more Manitobans touring and I think that , sure, maybe other Canadians would be on the way to Expo. I know that people who had motels right along the Trans Canada Highway had a reasonably good business, but other people weren't all that thrilled who were off the Trans -Ca nada . They didn't have that great of a year. So I'm going by what industry people are saying and I'm going by what industry people said up at Hecla, that they weren't extremely happy with last year. In fact, they weren't happy .

The feeling there was not that of great optimism . So I go by what the industry says, and I guess we could fudge figures forever and confuse everybody completely . HON. M. HEMPHILL: Mr. Chairman, there are obviously different pieces of information going around depending on who you talk to. In recent conversations with Mrs . Cornell, the President of TIAM , she was communicating to us that, as a tourist operator, things were looking very good. They were feeling quite positive about the season and that all other operators she talked to were feeling exactly the same way.

We've had other indications like that really from all other sectors. The Convention Centre, things are looking good. You know, all of the other sectors, we're getting that kind of feedback. They think it's looking good for this year. MR. E. CONNERY: Of course , I'm referring to '86, and like even Bob Locke, he said, and it's in the paper, that it was a "yuk year," in his terms . So I think we have to accept - hopefully, this year will be somewhat different. HON. M. HEMPHILL: The mood in the industry is very good and they should be the ones who know. MR. E. CONNERY: As you said, one month does not a season make.

HON. M. HEMPHILL: Right . Our inquiries are up 2,000 and , when we began advertising our brochures that the Member for Portage la Prairie loves so much , their response was so incredible that we actually for the first time have had a backlog that we hope to have taken care of in about a week . Since January, we 've had 2,000 inquiries , but most of them have come in in the last six weeks, the last four to six weeks. MR. E. CONNERY: When that good Progressive Conservative Government made that slight error in the Trout Festival, did anybody from the Opposition make note of it in the House? HON. M.

HEMPHILL: I can't recall, because the member who might have that information isn't available . Likely not , because we would have recognized that these things happen. MR. E. CONNERY: The MPI, the planner's group, what did it cost us to really bring that to Manitoba, the cost to Manitoba, the cost to the Boston party? HON. M. HEMPHILL : It 's $187 ,000 under the agreement ; so it's cost-shared with the Federal Government over a two-year period - a bette r bang for that buck for that, you cannot get. MR. E. CONNERY: I'm not criticizing it. I just want it put on the record just for my own edificat ion. HON. M.

HEMPHILL: No, I didn't think you were. MR. E. CONNERY : Rendezvous Canad a, do we subsidize some of the booths that go to Rendezvous Canada from Manitoba? HON. M. HEMPHILL: No, Mr. Chairman. MR. E. CONNERY: They all pay thei r own way? HON. M. HEMPHILL: They all pay their own way. MR. E. CONNERY: And if they go to Montreal or to places, there are no subsidies? HON. M. HEMPHILL: They pay their own way. MR. E. CONNERY: Okay. I made comment in the House and the Minister was some upset because I had made some comment on the Manitoba display .

I really do th ink that we can improve the Manitoba display compared to what I saw. Newfoundland had an excellent one; I think Quebec 's - just the style that they did there, it drew people to them. I know it 's individual selling and that, but it just gives you maybe a little bit better impression of the province and it may be the overall impression helps sell to the people who are buying. So it was the impression that I got just walking in. Maybe the Minister could take note of it. HON. M.

HEMPHILL: Yes, I'd like to even comment on it because when the membe r makes reasonable points, as he occasionally does, I like to recognize it. Actually, I was not upset because you made points about the display. I quite agree with the points you're making about the display. I think if we can get our industry people to recognize - and I think they're recognizing it more and more - the potential for putting forward a total positive image for the province by opening up those booths and th ose curtain s and sharing the space, I think it is a better image. 2910

Tuesday, 9 June, 1987 It's our intention to work with the people who are going to be

part icipating in the displays and see if we can get an agreement but since they pay for the booths , the money, it does require their agreeing that this is a good idea. I think we should be doing that. Just to make it clear what I was upset about , I think I was upset because the conference was such a successful one overall. They were suggesting or believing that they had done more business in the first day of Rendezvous than had been done in the whole previous three days in the year before . They were all calling it the most successful Rendezvous ever held in Canada since its initiation .

The Member for Portage La Prairie was focusing on one empty booth. So I think my point there was once again the balance. When things are pulled off that are such a big job , so important to the tourism industry, it would be nice not to have so much focus on one tiny element. The booth was empty. The booth shouldn 't have been , in my view, left there empty, but we had problems getting the people who control the booth making a decision on how to deal with it. That was unfortunate, because it doesn 't look good to have an empty booth, and I think we should be getting everybody together to get a special display.

I'd just like to make the point that Rendezvous itself was a tremendous effort and tremendous benefit, I think, potential to Manitoba , and that should also go on the record. MR. E. CONNERY: I have to concur. The sales with the Manitoba booth - we didn 't check with booths of other provinces - but the Manitoa booths, we checked them out and their sales were excellent. I agree they were good. How do people get to have a booth in Rendezvous Canada, from Manitoba? HON. M.

HEMPHILL: There is some history and past practice , and I think people who have had booths have some opportunity to indicate if they want to continue having a booth. I think that what we need to do is look at that practice, people who have been getting booths for a long period of time, and look at the total image that is being put forward by the province and make sure that our sectors and the things that we want to promote are there on display.

So I think that we may be taking a look at the overall show that is being put forward by Manitoba, but people who have been out there doing the job are basically given an opportunity to do it again. MR. E. CONNERY: Is there room for additional people then to come in, or are we boxed into this number? HON. M.

HEMPHILL: Our numbers are very tight and I guess we were given a few more this year simply because we were hosting it, but the numbers, I think, compared to other provinces - we're all marketing a province and the capital , the numbers of people in those provinces may vary considerably, but we're still all doing the job of marketing a province . To have a range and a ratio that goes from something like 11 to over 60, I find unacceptable.

While I'm told that there are hard and fast rules and regulations, I intend to question them and to suggest that there should be less disparity and better sharing of the booths and the space that is available with the smalle r provinces. MR. E. CONNERY: The Rendezvous Canada of course, if I am cor rec t, is totally put on , managed and whatever by the Government of Canada. Ther e is no provin cial input. The province paid half of the cost of the Monday night extravaganza and it was an excellent extravaganza. The entertainment was world-class . The food was good.

The whole evening was an excellent evening, and I thank the Minister for that inv itatio n. But it is put on by the government , I am told, and it 's a strictly Federal Government operati on. HON. M. HEMPHILL: Yes. MR. E. CONNERY: Okay. HON. M. HEMPHILL: Although, when you're hosting , it's clear that, when you're the host province, clearly what is made available in the host province has clearly got a lot to do with the people in that province, even if somebody outside is organizing it. Our ability to deliver what they organize is dependent upon our province's industry and our people. MR. E.

CONNERY: I want to go back to one item the Minister was quoting - travel on Highway 75. She was quoting'85 statistics but we should have '86 statistics. HON. M. HEMPHILL: I'm not sure. We'll look to our statistician. The information that I gave is that the U.S. travel on Highway 75 is up 10 percent for'85, and he is asking what it is for '86. It's down 4.2 percent. I'll have to repeat it so that it shows. It's down 4 percent. MR. E. CONNERY: I've got two ears. Is there any Jobs Fund money in the tourism sector? HON. M. HEMPHILL: No. MR. E. CONNERY: Okay, I want to go into the marketing plan.

The area that I want to take a look at, and I have some difficulty with some of the figures on page 9. It's addressing Manitoba's tourism economics. We look through the sectors and we have transportation, and I am assuming we are talking about Manitobans travelling within Manitoba, this sector, provincial receipts. HON. M. HEMPHILL: Total Manitobans and non residents. MR. E. CONNERY: Total Manitobans and non residents. Do you have a breakout for the non-residents for these various sectors? I mean not the non-residents - the Manitobans. We talk about the number of dollars for Manitobans.

What are those figures for that? HON. M. HEMPHILL: Mr. Chairman , I have some information that indicates total traveller expenditures 2911

Tuesday, 9 June, 1.987 in Manitoba in millions. I have the numbers for '85, and they 're not completed yet for '86 . Manitobans . . . MR. E. CONNERY: Do you have them by those sectors, transportation? HON. M. HEMPHILL: No, I don't have them by sectors right here. I'll just give you the totals. We'll get the sectors for you, I guess later, if you wish. Manitobans is $362 million; other Canadians, $124.9 million; Americans, $83.9 million ; foreign, $13 .3 million. The total is $584 .6 million. MR. E. CONNERY: How do you tally your transportation receipts? How do you get this factor for transportation?

We are looking at figures for 1985 . How does the $271 million in transportation, how do we arrive at that figure? If Americans are coming into Manitoba , they're buying their ticket someplace else . HON. M. HEMPHILL: Mr. Chairman, it includes a number of elements. One is Manitoba expenditures on transportation, non-resident expenditures on gas, and Manitoba expenditures on air fare leaving Manitoba. MR. E. CONNERY: What would the amount of air fare for Manitobans leaving Manitoba be? HON. M. HEMPHILL: I knew it. MR. E. CONNERY: I tell you , I don't sleep at night, I think. HON. M. HEMPHILL: Mr.

Chairman, our resident statistician informs us that kind of detail he will have to get for you another day. MR. E. CONNERY: Will we have it for Thursday? HON. M. HEMPHILL: Approximately $100 million he believes, and we'll confirm it for Thursday. MR. E. CONNERY: The transp

Document details

Collection	Manitoba — Debates (Hansard)
Citation	33-2-65
Type	hansard
Volume / chapter	33rd 2nd hansardpdf 65.pdf
Language	en
Format	pdf
Source	PROVINCIAL
Identifier	f3a7038818889cf211c38f71db443897f848fc3b

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