Manitoba Hansard — 8 April 1998 (Sitting 28, 36th Legislature, 4th Session)

36-4-28

Manitoba — Debates (Hansard)

Fourth Session - Thirty-Sixth Legislature of the Legislative Assembly of Manitoba DEBATES and PROCEEDINGS Official Report (Hansard) Published under the authority of The Honourable Louise M. Dacquay Speaker Vol. XLVIII No. 28 - 1:30 p.m., Wednesday, April 8, 1998 ISSN 0542-5492

MANITOBA LEGISLATIVE ASSEMBLY Thirty-Sixth Legislature Member Constituency Political Afriliation ASHTON, Steve Thompson N.D.P. BARRETT, Becky Wellington N.D.P. CERILLI, Marianne Radisson N.D.P. CHOMIAK, Dave Kildonan N.D.P. CUMMINGS, Glen, Hon. Ste. Rose P.C. DACQUA Y, Louise, Hon. Seine River P.C. DERKACH, Leonard, Hon. Roblin-Russell P.C. DEWAR, Gregory Selkirk N.D.P. DOER, Gary Concordia N.D.P. DOWNEY, James, Hon. Arthur-Virden P.C. DRIEDGER, Albert Steinbach P.C. DYCK, Peter Pembina P.C. ENNS, Harry, Hon. Lakeside P.C. EVANS, Clif Interlake N.D.P. EVANS, Leonard S. Brandon East N.D.P.

FAURSCHOU, David Portage Ia Prairie P.C. FILMON, Gary, Hon. Tuxedo P.C. FINDLAY, Glen, Hon. Springfield P.C. FRIESEN, Jean Wolseley N.D.P. GAUDRY, Neil St. Boniface Lib. GILLESHAMMER, Harold, Hon. Minnedosa P.C. HELWER, Edward Gimli P.C. HICKES, George Point Douglas N.D.P. JENNISSEN, Gerard Flin Flon N.D.P. KOWALSKI, Gary The Maples Lib. - LAMOUREUX, Kevin Inkster Lib. LATHLIN, Oscar The Pas N.D.P. LAURENDEAU, Marcel St. Norbert P.C. MACKINTOSH, Gord St. Johns N.D.P. MALOWA Y, Jim Elmwood N.D.P. MARTINDALE, Doug Burrows N.D.P. McALPINE, Gerry Sturgeon Creek P.C. McCRAE, James, Hon. Brandon West P.C.

McGIFFORD, Diane Osborne N.D.P. MciNTOSH, Linda, Hon. Assiniboia P.C. MIHYCHUK, MaryAnn St. James N.D.P. MITCHELSON, Bonnie, Hon. River East P.C. NEWMAN, David, Hon. Riel P.C. PENNER, Jack Emerson P.C. PITURA, Frank, Hon. Morris P.C. PRAZNIK, Darren, Hon. Lac du Bonnet P.C. RADCLIFFE, Mike, Hon. River Heights P.C. REID, Daryl Transcona N.D.P. REIMER, Jack, Hon. Niakwa P.C. RENDER, Shirley St. Vital P.C. ROBINSON, Eric Rupertsland N.D.P. ROCAN, Denis Gladstone P.C. SALE, Tim Crescentwood N.D.P. SANTOS, Conrad Broadway N.D.P. STEFANSON, Eric, Hon. Kirkfield Park P.C. STRUTHERS, Stan Dauphin N.D.P.

SVEINSON, Ben La Verendrye P.C. TOEWS, Vic, Hon. Rossmere P.C. TWEED, Mervin Turtle Mountain P.C. VODREY, Rosemary, Hon. Fort Garry P.C. - WOWCHUK, Rosann Swan River N.D.P. Vacant Charleswood

13 47 LEGISLATIVE ASSEMBLY OF MANITOBA Wednesday, AprilS, 1998 The House met at 1:30 p.m. PRAYERS ROUTINE PROCEEDINGS PRESENTING PETITIONS Women's Resource Centres Ms. Diane McGifford (Osborne): Madam Speaker, I beg to present the petition of Lindsey Tretiak, Darlene King, Roslyn Sigvaldason and others praying that the Legislative Assembly of Manitoba urge the Filmon government to consider providing long-term, adequate and stable funding for the Evergreen Women's Resource Centre and other women's resource centres in the province to ensure that the vital services provided by these organizations are continued.

Winnipeg Hospitals Food Services-Privatization Ms. Jean Friesen (Wolseley): Madam Speaker, I beg to present the petition of Lorette Krivak, Donna Boreski, Cyndy Park and others praying that the Legislative Assembly of Manitoba urge the Minister of Health (Mr. Praznik) to put an end to the centralization and privatization of Winnipeg hospitals food services. Mr. Gregory Dewar (Selkirk): Madam Speaker, I beg to present the petition of J.

Defoort, Carol Hennessy, Lorraine Remillard and others requesting that the Legislative Assembly of Manitoba urge the Minister of Health to put an end to the centralization and privatization of Winnipeg hospitals food services. Mr. George Hickes (Point Douglas): Madam Speaker, I beg to present the petition of Kim Marr, Marie Versace, Sophie Looker and others praying that the Legislative Assembly of Manitoba urge the Minister of Health to put an end to the centralization and privatization of Winnipeg hospitals food services.

READING AND RECEIVING PETITIONS Winnipeg Hospitals Food Services-Privatization Madam Speaker: I have reviewed the petition of the honourable member for Broadway (Mr. Santos). It complies with the rules and practices of the House (by leave). Is it the will of the House to have the petition read? An Honourable Member: Dispense. Madam Speaker: Dispense.

THAT the Urban Shared Services Corporation (USSC) has announced plans to privatize laundry, food services and purchasing for the Winnipeg hospitals; and THAT it is estimated that more than 1, 000 health care jobs will be lost over the next year as a result, with many more privatized in the next two or three years; and THAT under the terms of the contract, Ontario businesses will profit at the expense of Manitoba's health care system; and THAT after construction of a food assembly warehouse in Winnipeg, chilled, prepared food will be shipped in from Ontario, then assembled and heated before being shipped to the hospitals; and THAT people who are in the hospital require nutritious and appetizing food; and THAT the announced savings as a result of the contract have been disputed, and one study by Wintemute Randle Kilimnik indicated that, "A considerable number of studies have compared costs of service delivery in health care between self-operation (public sector) and privatization.

Invariably, privatization is more expensive. "; and THAT no one in Manitoba seems to benefit from this contract, especially patients.

13 48 LEGISLATIVE ASSEMBLY OF MANITOBA April 8, 19 98 WHEREFOREYOURPETITIONE RSHUMBLYPRAY that the Legislative Assembly of Manitoba urge the Minister of Health to put an end to the centralization and privatization of Winnipeg hospital food services. * (1 335 ) Women's Resource Centres Madam Speaker: I have reviewed the petition of the honourable member for Osborne (Ms. McGifford). It complies with the rules and practices of the House. Is it the will of the House to have the petition read? An Honourable Member: Dispense. Madam Speaker: Dispense.

THAT the Evergreen Women's Resource Centre provides services which focus on prevention and intervention in domestic abuse for communities within a 1 00-kilometre radius; and THAT with only partial funding from the provincial government, Family Dispute Services, in the amount of $37,600 and some funding from the communities it serves, the Evergreen Women's Resource Centre hires three part-time employees and provides telephone, counselling, training and seminar facilities, in addition to education, information and outreach programming; and THAT Evergreen Women's Resource Centre is also involved in referral services on a crisis-intervention and second-stage outreach level; and THAT for years, the Evergreen Women's Resource Centre has struggled to provide these vital programs and services with limited funding or commitment from the provincial government; and THAT during the 1995 provincial election, the Filmon government said, "The safety and security of the individual, our families and our communities is vital to the quality of our life.

"; and THAT if the Filmon government is really committed to that statement, it must back it up with funding for the agencies that provide services to make it a reality. WHEREFORE YOUR PETITIONERS HUMBLY PRAY that the Legislative Assembly of Manitoba urge the Filmon government to consider providing long-term, adequate and stable funding for the Evergreen Women's Resource Centre and other women's resource centres in the province to ensure that the vital services provided by these organizations are continued. Madam Speaker: I have reviewed the petition of the honourable member for Swan River (Ms. Wowchuk).

It complies with the rules and practices of the House. Is it the will of the House to have the petition read? An Honourable Member: Yes. Madam Speaker: Yes. The Clerk will read. Mr.

Clerk (William Remnant): The petition of the undersigned citizens of the province of Manitoba humbly sheweth: THAT the Evergreen Women's Resource Centre provides services which focus on prevention and intervention in domestic abuse for communities within a 1 00-kilometre radius; and THAT with only partial funding from the provincial government, Family Dispute Services, in the amount of $37, 600 and some funding from the communities it serves, the Evergreen Women's Resource Centre hires three part-time employees and provides telephone, counselling, training and seminar facilities, in addition to education, information and outreach programming; and THAT Evergreen Women's Resource Centre is also involved in referral services on a crisis-intervention and second-stage outreach level; and THAT for years, the Evergreen Women's Resource Centre has struggled to provide these vital programs and services with limited funding or commitment from the provincial government; and THAT during the 19 95 provincial election, the Filmon government said, "The safety and security of the individual, our families and our communities is vital to the quality of our life."; and - -

April 8, 19 98 LEGISLATIVE ASSEMBLY OF MANITOBA 13 49 THAT if the Filmon government is really committed to that statement, it must back it up with funding for the agencies that provide services to make it a reality. WHEREFORE YOUR PETITIONERS HUMBLY PRAY that the Legislative Assembly of Manitoba urge the Filmon government to consider providing long term, adequate and stable funding for the Evergreen Women's Resource Centre and other women's resource centres in the province to ensure that the vital services provided by these organizations are continued.

Brandon University Foundation Madam Speaker: I have reviewed the petition of the honourable member for Brandon East (Mr. Leonard Evans). It complies with the rules and practices of the House. Is it the will of the House to have the petition read? Some Honourable Members: Dispense. Madam Speaker: Dispense. The petition of Brandon University Foundation praying for the passing of

an act to amend The Brandon University Foundation Act to delete clause 5e(

i) and (ii) and add clause 5g - The Corporation shall have the powers and capacity of a natural person of foil capacity. Winnipeg Hospitals Food Service-Privatization Madam Speaker: Order, please. May I get clarification from the honourable member for Elmwood (Mr. Maloway). Are you wishing to both present as well as read and receive? [interjection] You are just doing reading and receiving. Okay. Is there leave to revert to permit the honourable member for Elmwood to read and receive his petition? [agreed] I have reviewed the petition of the honourable member for Elmwood (Mr. Maloway).

It complies with the rules and practices of the House. Is it the will of the House to have the petition read? An Honourable Member: Dispense. Madam Speaker: Dispense.

THAT the Urban Shared Services Corporation (USSC) has announced plans to privatize laundry, food services and purchasing for the Winnipeg hospitals; and THAT it is estimated that more than 1, 000 health care jobs will be lost over the next year as a result, with many more privatized in the next two or three years; and THAT under the terms of the contract, Ontario businesses will profit at the expense of Manitoba's health care system; and THAT after construction of a food assembly warehouse in Winnipeg, chilled, prepared food will be shipped in from Ontario, then assembled and heated before being shipped to the hospitals; and THAT people who are in the hospital require nutritious and appetizing food; and THAT the announced savings as a result of the contract have been disputed, and one study by Wintemute Randle Kilimnik indicated that, "A considerable number of studies have compared costs of service delivery in health care between self-operation (public sector) and privatization.

Invariably, privatization is more expensive."; and THAT no one in Manitoba seems to benefit from this contract, especially patients. WHEREFORE YOUR PETITIONERS HUMBLY PRAY that the Legislative Assembly of Manitoba urge the Minister of Health to put an end to the centralization and privatization of Winnipeg hospital food services. * (1 340) PRESENTING REPORTS BY STANDING AND SPECIAL COMMITTEES Committee of Supply Mr. Marcel Laurendeau (Chairperson): Madam Speaker, the Committee of Supply has adopted certain resolutions, directs me to report the same and asks leave to sit again.

13 50 LEGISLAT IVE ASSEMBLY OF MANITOBA April 8, 19 98 I move, seconded by the honourable member for Emerson (Mr. Penner), that the report of the committee be received. Motion agreed to. TABLING OF REPORTS Hon. James Downey (Minister of Industry, Trade and Tourism): Madam Speaker, I am pleased to table the Supplemen tary Information for Legislative Review for the Department oflndustry, Trade and Tourism for '98-99. Hon.

David Newman (Minister of Energy and Mines): Madam Speaker, I am pleased to table the Supplem entary Information for Legislative Review, 19 98-99, Departmental Expenditure Estimates for the Department of Energy and Mines. I am also pleased to table the Supplem entary Information for Legis lative Review, 19 98-99, Departmental Expenditure Estimates for the Department ofNorthern Affairs.

Introduction of Guests Madam Speaker: Prior to Oral Questions, I would like to draw the attention of all honourab le members to the public gallery where we have with us firstly, 25 journalism students from Red River Community College under the direction of Mr. Donald Benham and twenty-nine Grades 9 and 11 students from Elm Creek School under the direction of Mr. Dave McGill. This school is located in the constituency of the honourable Minis ter of Agricult ure (Mr. Enns). We also have forty -five Grade 11 students from Churchill High School under the direction of Mr. Ed Lenzmann.

This school is located in the constituency of the honourable member for Osborne (Ms. McGifford). On behalf of all honourable members, I welcome you this afternoon. ORAL QUESTION PERIOD Manitoba Telecom Services Board Appointments Mr. Gary Doer (Leader of the Opposition): Madam Sp eaker, my question is to the Premier. On April 6 and 7 of this week the Pr emier and Minister of Finance (Mr. Stefanson) and minister responsible for the golden share of the Manitoba Telephone System stated that Mr. Tom Stefanson was not one of the appointees of this government on the board of the Manitoba Telecom Services.

Madam Speaker, we have an Order- in-Council dated January 7, 1997, which is sig ned by the minister responsible for the golden share, one Mr. Stefanson, and signed by the Premier that appoints Mr. Tom Stefanson to the chair of the board of the Manitoba Telecom Services. Will the Premier now confirm that he was misleading this House, and in fact he was the one who signed the Order-in-Council appointing the first private board at the Manitoba Telecom Services? Hon. Gary Filmon (Premier): As the member knows full well, that was the case previously but is not the case today.

There are only four members who are appoin ted by the government at the present time, and they do not include the gentleman to whom the member refers. Stock Option Plan Mr. Gary Doer (Leader ofthe Opposition): Madam Sp eaker, the Order -in-Council clearly appoin ts Mr. Stefanson, sig ned by Mr. Stefanson, signed by the Premier on January 7, 1997. I would like to further ask the Premier then, on this board appointed by the Conser vatives, friends of the Conserva tives, relatives of the Conser vatives initiated a massive stock option plan that would provide significant funds for their own personal use.

They proceeded to initiate this plan almost immediately, and by April 14 , 1997, the same board, with the same chair, appointed by the same government and the same minister, had initiated a massive stock option plan for themselves, had had it already approved by the Toronto, Winnipeg and Montreal stock exchanges. Does the Premier think it is appropriate for this Tory boa rd to start initiating increases in salaries and stock options for themselves by April 14 in a circular long before the shareholders' meeting? Hon.

Eric Stefanson (Minister of Finance): Madam Speaker, I encourage the Leader of the Opposition to go -

April 8, 19 98 LEGISLATIVE ASSE MBLY OF MANITOBA 1351 back to the minutes of the first annual meeting ofMTS back in 19 97, and he will see very clearly that the board of directors was elected by the shareholders. Out ofthe 11 board of directors, seven are elected by the board of dir ectors, four are appoi nted by the provincial government, and I have indicated to him before who our four appointees are. Mr. Robert Chipman, Ashleigh Everett, Don Penny and Sam Schellenberg are the four provincial appointees. The other seven were elected by the shareholders at that meeting in 19 97.

Later in that same meeting the shareholders again ra tified a stock option plan in concept which allowed for the issuing of up to $3.5 million of additional shares under a stock option plan. Going forward now to the 19 98 annual meeting, the board of directors ofMTS has come forward with the details of that plan, which includes an allocation to board members and an allocation to many senior executive officers. That is the sequence of events. Those are the facts. * (1 345) Mr.

Doer: Yesterday the Mini ster of Finance, who is responsible for the golden share and also responsible for the Order -in-Council appointing his brother and other Tories, stated that he became aware of the stock option plan just weeks ago. Madam Speaker, I have the circular dated April 14, which was initiated by his chair, by this government's slate of Tories, Tory friends, Tory relati ves, that initiates the stock option plan that virtua lly makes members of the opposite side's relatives millionaires.

That was initiated and circula ted on April 14, 19 97, prior to the shareholders' meeting that the Minis ter of Finance is talking about today. Is the Mini ster of Finance saying that he did not read the circular, he was totally unaware of the stock option plan that was initiated by his Tory board and his Tory relatives? Is he saying today that as a responsibi lity of holding the golden share, he pays no attention to the Tory greed that is going on at the new telephone system? Mr.

Stefanson: Madam Sp eaker, I encourage this member to pay attention when he sits in this House, and go back and read Hansard of two days ago, on Monday. I indicated very clearly that there was a circula r issue, that a stock option plan was approved by the board back in 19 97, so read those minutes from Hansard. To the member opposite, I encourage him to do that. So the plan in concept was approved back in 19 97. What we are talking about now are the details of the allocation which have just been released in the last 10 days.

I was just made aware of the details of the allocation, as I indicated in this House yesterday, within the last couple of weeks, so there is a big difference. There is the approval ofthe concept of a plan which I referred to on Monday, which is outlined very clearly in the circular. I offered to the member for Crescentwood (Mr. Sale) to provide him a copy of that circular. It was ra tified by the board back in 19 97, by the shareholders back in 19 97. The detail allocations have now been provided within the last 10 days, and those are what I was referring to.

So I encou rage him to pay attention when he is in this House and go back and read the minutes. Manitoba Telecom Services Stock Option Plan Mr.

Tim Sale (Crescentwood): Madam Sp eaker, is the Finance minister, the minister responsible for Manitoba Telecom Services trying to tell the House that a stock option plan which was approved by three of Canada's stock exchanges, regulatory bodies that had to receive substantial detail, substantial information about those plans, that that information which must have been submitted to those exchanges about six weeks after his board was appoin ted- these people were beavering away at their own compensation immediately on appoi ntment-is he saying he is so totally unaware, so out of touch with the appointees and the board he appoin ted that he did not know anything about this happening?

When he realizes that the stock exchanges that approved this, they must have had it six weeks before this circular went through; they were lining their own pock ets within weeks of approval of your board, your brother. Hon. Eric Stefanson (Minister of Finance): Madam Speaker, I can see how I will have to provide things in writing to the member for Crescentwood, because he too does not pay attention. I indicated very clearly on Monday in this House; I read from the information circ ular that very day that in 19 97 a stock option plan was approved. I referred to the fact that the plan allows

1352 LEGISLATIVE ASSE MBLY OF MANITOBA April 8, 19 98 for up to $3 .5 million of shares to be issued under the stock option plan. The detailed allocation was referred to the human resources committee of the board of directors. They came forward to the board, and those details have just been made public and released within about the last 10 days, the detailed allocation to the board members, the detailed allocation to senior executive officers. So we are well aware . We have been well aware that there was a plan approved in concept, in terms of the detailed allocation within that plan.

That has been made public and brought to our attention within the last couple of weeks. So again, that is exactly the sequence of events. It is the same information I gave this House on Monday, the same information I am giving members oppos ite today. I encourage him to pay attention and, if they need to, go back and read Hansard. Mr.

Sale: Madam Speaker, is this minister responsible for the Telecom Services asking this House to believe that never in the past 14 months has he had any contact with his brother, the chair, with the four appointees, with Sam Schel lenberg, the chair of the compensation committee, that never was he aware that by April 14 , 19 97, all of the substantive details of this plan had to have been in place, that in fact all of the details were in place by that annual meeting, and that he should have known that if he was exercising any stewardship or any ethical cons ideration for what had been going on with his appointed board?

Mr. Stefanson: Madam Spea ker, this member for Crescentwood is clearly confused. I have indicated on many occasions that this stock option plan was outlined in a cir cular that was dated April 14 , 19 97. The same stock option plan was approved by the board of directors and by the shareholders of Manitoba Telecom Services on May 30, 19 97, so the plan in concept was approved. What is happening now in 19 98 is the details within the allocation, within that plan have been made public and have been provided.

So we are certainly well aware and have made it very clear to this House that a stock option plan was approved back in 19 97. All telecommunications companies, I believe, in Canada today have stock option plans. It is nothing new; in fact, it is a require- ment to register with some of the stock exchanges in Canada. The issue is the allocation within that stock option plan, and that is what has become public and what we were made aware of within the last couple of weeks. * (135 0) Mr.

Sale: Madam Spea ker, will this minister not simply acknowledge the truth and that is that well prior to the annual meeting, that is at least by April l4 , 19 97, the board of directors, including his brother, appointed by him on an 0/C of January 7, 19 97, had already approved this stock option plan? They already had it registered with the stock exchanges. That must have taken place in Febr uary if the time lines were going to be met. They had already put this in place; they had already approved it. Will he not simply acknowledge that? Mr.

Stefanson: Madam Speaker, we have never denied that a stock option plan was approved in 19 97. I said in this House on Monday, and I referred to the information cir cular that members opposite are finally referring to today-1 referred to that circular on Monday- that it was circula ted back in April 19 97 outlining the concepts of the plan, the amount of shares that would be available, 3.5 million shares, the equi valent of 5 percent of the total shares of MTS. That was all approved in 19 97. It was ra tified by the shareholders ofMTS, some 70,000 shareholders, many of them, the major ity of them Manitobans.

That was all done in 19 97. What has happened subsequent to the plan is the detailed allocation to individual board members and individual senior executive officers. That is happening in 19 98. That was made available in a document ref erring to the 19 98 annual meeting. That will be information that is available to the shareholders at their 19 98 annual meeting. That is the sequence of events, and again, those are the facts. Manitoba Telecom Services Board Appointments Mr. Steve Ashton (Thompson): The more that one looks at this, the more it stinks.

The more one looks at it, it is clear that the minister responsible for MTS has - -

April 8, 19 98 LEGISLATIVE AS SEMBLY OF MANITOBA 1353 not been telling the truth to this Legi slature and Manitobans. Will the minister confirm that in an Order -in-Council dated January 7, signed by him and the Premier, they appointed not four directors, as he indicated yesterday, but II directors, of which one was Tom Stefanson and the remaining of which was the slate for the actual board of direc tors that was adopted at the annual meeting in May? Hon.

Eric Stefanson (Minister of Finance): Madam Sp eaker, I tell the truth at all times, and I tell the truth every single time I am in this House, unlike some people in this Chamber. When it comes to the issue of the board, as we have indicated on a number of occasions, the board of directors was elected in the 19 97 shar eholders' meetings that are referred to on May 30, 19 97. That is when the shareholders elected seven out of the 11 board members. We as a government have appointed four of the members, and I have outlined on many occasions who our four members are. Mr.

Ashton: Why will not the minister for MTS acknowledge that he not only appointed his own brother, he appointed all of the directors that were currently in place, the Stefanson slate, as well as the individual that recommended this stock option, and that it was a fait accompli before it went into the shareholders' meeting in May? Why will he not tell the truth that he set his brother up for a million dollars at the expense of Manitobans? Mr. Stefanson: Madam Speaker, I do encourage this member for Thompson to look at the minutes of the first share holders' meeting of Manitoba Telecom Services on May 30, 19 97.

He will see the election of seven of the directors . He will see subsequen t-later in that meeting, he will see the approval of a stock option plan by the shareho lders, some 70,000 shareholders of Manitoba Telecom systems, approving the stock option plan. That approval approved a plan in concept. In fact, it goes on to talk about: the board of directors of the corporation shall administer the plan, determine participa nts to whom options shall be grant ed, and so on and so forth. During 19 97 and 19 98 the board did just that; it provided that information within the last 10 days.

I was made aware of that allocation within the last couple of weeks. So the issue of the plan was approved back in 19 97. I believe every telephone company in Canada has a stock option plan. It is certainly very common in all kinds of businesses right across Canada, and the detailed allocation was provided in the last couple of weeks. * (1 355) MATTER OF PRIVILEGE Manitoba Telecom Services Board Appointments Mr.

Steve Ashton (Opposition House Leader): Madam Speaker, I rise on a matter of privi lege, and it relates directly to the contempt shown to this Legislature not only by the minister responsible for MTS but by the Premier (Mr. Filmon). I would like to table a copy of the Order- in-Council that was signed by Eric Stefanson, the minister responsible for MTS, also signed by the Premier.

It outlines, contrary to what the Premier said on Monday when he pointed to four government appointees, the current four, and what the minister said yesterday when he tried to use the same line to duck the fact, that on January 7 he appointed by his signature a board of 11 directors, the interim board, which included his brother, which included one D. Samuel Schellenberg, the person who was responsible for the compensation committee.

I also want to table a copy of the information circular that was filed by Manitoba Telecom Services Inc. which indicates that as of April 14 , well before the meeting that they keep referencing, they already had agre ement to the compensation package and it had been approved by the three major stock exchanges. I want to table that as well and point to the fact that this minister responsible for MTS still does not get it. He appointed his brother to the interim board. He appointed by his own signature. The Fir st Mini ster signed that.

He appointed the 1 1- person board which became the slate, the interim board, also people that they are very well aware of. This slate, this board, the interim board was the board that developed the compensation package

13 54 LEGISLATIVE ASS EMBLY OF MANITOBA April 8, 19 98 which, surprise, surprise, ended up with Tom Stefanson getting a million-dollar stock option program . If the Minister of Finance and the Premier do not understand that is unethical, Madam Speaker, they do not understand what ethics are about. We asked on Monday; we asked on Tuesday; we asked again today, and we gave the minister responsible for MTS the opportunity to clarify the record, to tell the truth to Manitobans. I say, Madam Spea ker, we have no choice as a Legis lature other than to find that minister in contempt.

If he does not understand what is wrong with being the minister responsible for MTS appointing his brother, who ends up getting a million dollar benefit at the end, we have serious problems. That is why I move, seconded by the member for Concordia (Mr. Doer), that the matter of the Premier (Mr. Filmon) and Mini ster of Finance (Mr. Stefanson) showing contempt for the House by deliberately making misleading statements concerning the unethical appointment of Thomas E. Stefanson to the board of directors of Manitoba Telecom Services, allowing Mr.

Stefanson and other directors to enrich themselves through a multimillion-dollar compens ation plan, be referred to the Committee on Privileges and Elections. Hon. James McCrae (Government House Leader): Madam Spea ker, the honourable member for Thompson has for I do not know how many times raised questions of privilege in this House related to the priva tization ofthe Manitoba Telephone System. He fails on both the grounds that are required to be met with respect to questions of privilege. The issue of timeliness, it is clear he has failed on that one.

With respect to a prima facie case, it is a common occurrence in this House that honoura ble members on each side of the House see things in a different light. That in no way amounts to a question of privilege. In fact, it is a good thing. If we did not have that, we would not have the kind of democr acy that we have in our country. But that said, on the prima facie matter of making a case of privilege, the honourable member has totally failed to prove anything except-or to bring forward prima facie anything other than a difference in the way he sees things and in the way the honourable Mini ster of Finance (Mr.

Stefanson) and honourable members on this side see things. What we are involved in, and I think honourable members opposite sometimes show some expertise in this area, is a matter of spin, and the honourable member for Thompson has spun every which direction he could ever since the fall of 19 96. He is in a time warp. He cannot get over the events of those days. When this House agreed on certain courses of action, and just because the honourab le member's party thinks that it should be able to rule this House and cannot, they feel they have to raise a question of privi lege on every occasion they can.

They simply do not get it, to repeat the honourable member for Thompson himself, they do not get what democracy is all about. Democr acy allows Legis latures to speak and honourable members would like to stifle this Legis lature. Some Honourable Members: Oh, oh. * (1 400) Madam Speaker: Order, please. A matter of privilege is a very impor tant matter, and I would ask for the co opera tion of all honourable members in listening to the advice that is being provided to the Chair. I am experiencing great difficulty in hearing some of the comments of the honourable government House leader.

Was the honourable government House leader finished? The honourable government House leader, to complete his remarks. Mr. McCrae: I had virtually concluded because there is business that needs to be done in this House, and the honoura ble members opposite cannot seem to get over the cir cumstances in which they find themselves. I know that the honourable Minis ter of Finance has something to say as well, and I have indeed concluded. Hon.

Eric Stefanson (Minister of Finance): Madam Spea ker, the member for Thompson has no matter of privi lege and I want to remind him and his Leader and members opposite of some of the things I said on Monday. The suggestion about the awareness of the cir cular on April 14 and the annual shareholders' meeting in 19 97 on Monday in this House, in response to a question from the member for Crescen twood (Mr. Sale), I said very clearly: "I am certainly prepared to under take to provide members opposite with - - -

April 8, 19 98 LEGISLATIVE ASSE MBLY OF MANITOBA 1355 information from the circular providing information on the stock option plan, obviously minutes of the shar eholders' meeting that was held on May 30, 19 97, ratifying a stock option plan for MTS." I am certainly more than prepared to provide that information, which is public information, by the way. I go on again in responding to the same member, again ref erring in fact in that circula r that was distributed almost a year ago: "it says very clearly in the circular, for the benefit of the member for Kildonan (Mr.

Chomiak)," at that time, "that on the recomme ndation of its human resource and compensation committee, the board of directors of the corpora tion has approved the implementation of a stock option plan." That is the sequence of events that took place in 19 97. At a shar eholders' meeting, I believe on May 30 of 19 97, a board of direc tors was elected; seven of those board members were elected by the shareholders, by the some 70,000 shareholders, a majority of them Manitobans.

We as a government at that point in time appointed four members, on many occasions read into the record who those members were, and we have never in any way put any false information, any incorrect information, and always told the comp lete truth on the sequence of events and the tran sactions on this issue.

It is the member for Thompson who continues to be blinded by this issue, as we have seen on many occasions in this House, and continues to try to find any aspect of anything to do with the privatiza tion of MTS because he has opposed that, and he continues to rant and rave in his own way, but there is definitely no matter of privilege whatsoever, Madam Sp eaker. Mr. Kevin Lamoureux (Inkster): Madam Speaker, I, too, want to put a few words on the record with respect to what I think is a very important issue. It is an issue which has been brought up in the past.

I can recall one of my colleagues had discussed the issue of conflict of interest with me, in fact had sought out legal counsel to make sure, in terms of what it is that he should be doing, because someone that was very close to him was an employee at MTS, and it was that person or the employee who was subject to receiving some monetary benefit. He had decided after consulting and talking about the issue to avoid the vote itself because of the whole issue of perception. I think this is where the government is losing it somewhat on this issue.

You have to acknowledge that perception is impor tant in politics, and what Manitobans see here is in fact a brother of a minister who is receiving sign ificant dividends as a result of a government action. Under normal circumstances, if it were not the Mini ster of Finance (Mr. Stefanson) who was conducting or playing the role that he is playing or has played in the divestiture of MTS, I do not think it would be as questionable in terms of the whole issue of perception.

So what I see before us is two issues: The first issue dealing with a brother of the minister who was responsible for divesting, enriching or being enriched as a result of the divestiture, and the other issue of the conflict of interest of how these monies or the actual price that MTS was being sold for and people, outside of the minister's brother, also being enriched. The issue that concerns me is the one of the perception, because I do not believe this is something in which the government can in fact win. I think that it is very awkward.

I would find it very awkward to stand up and defend something, when in fact I am so closely tied to it because it is my brother who is in fact the receiver of a substantial amount of what is, in one way or another, indirectly, tax dollar benefits. I want to be very care ful because I realize whatever I say inside the Chamber I can get away with saying and not be liable to lawsuits outside of this Chamber. So I recognize that it is very, very impor tant in terms that we choose our words carefully. Madam Speaker, I think that there is concern with respect to how this individual was in fact appointed.

If in fact it was the Minister of Finance, I think that there is some merit to it being looked at. So what I would suggest is that, at the very least, this motion be taken as notice so that all parties concerned have some time to review it and to make a good decision as to what best to do with respect to it. Thank you. Mr. Tim Sale (Crescentwood): Madam Speaker, the point of the motion of privilege is the misleading of this House, the knowing misleading of this House by the

13 56 LEGISLATIVE ASS EMBLY OF MANITOBA April 8, 19 98 Premier (Mr. Fil mon) and the minister responsible for Manitoba Telecom Services. I want to review the chronology, because it is impor tant that we, first of all, make the prima facie case, and it is impor tant that you understand that we raised it at the first possible opportunity.

We needed to review Hansard-and I want to deal first with the opp ortunity questi on-very carefully and to review the evidence from the annual meetings and the circula rs that were shared with shareholders of the Manitoba Telecom Services prior to being able to move a motion of privilege. We did not receive the minister responsible for Telecom Services' answers until this morning in the rough draft of Question Period. So this is I think clear evidence that we have satisfied the first condition.

This is a very impor tant matter, and we did not want to pre-empt having read Hansard carefully prior to raising the matter. Secondly, on a prima facie case. The Premier on four different occasions earlier this week ref used to acknowledge that he had in fact, as the president of the Executive Council, signed an Executive Council order, an Order- in-Council, appointing Mr. Stefanson and Mr. Schelle nberg as continuing members of the board of directors of Manitoba Telecom Services on January 7, 19 97-that is more than a year ago-and further that that same 0/C appointed nine other new members of the board.

In other words, the first and most central issue here is the appointment of the first board of directors of this company long before there was a shar eholders' meeting to ra tify new directors of the corpora tion. The point my honourable colleague the member for Thompson (Mr. Ashton) has made is also important, that these are exactly, identically the same people whom the shareholders approved and continue to approve; that is, they are the people appoi nted by this government. They include relatives of senior members of this government. The person appointed from the previous board, Mr.

Schel lenber g, turns out to be the person in charge ofthe compensation committee of the new board. So the first point of the prima facie case is that on minister responsible, signed an Order -in-Council appointing II members of the board, one ofwhom was the brother of the minister signing the order, a second of whom was the person who turned out to be the chair of the compensation committee, Mr. Schel lenber g, continuing from the previous board. Now let me now tum to the second part of the prima facie case here, Madam Speaker.

What we are attempting to show, and I think we have shown, is that people appointed by this government directly, by the Premier and the Finance minister, developed, appro ved and put forward a plan to compensa te themselves and their senior executives, that that plan was developed well before there was ever an annual meeting of the shar eholders, and let me show that so that we are clear on those dates. This information cir cular to which the Finance minister refers was dated April 14 , 19 97. The annual meeting did not take place until May 30, 19 97.

So six weeks prior to the annual meeting, an information cir cular was sent to all shareholders, including the Minister of Finance, who of course has a special share which the minister responsible for the Telephone System previously, perhaps aptly called the golden share. Madam Sp eaker, let us work the chronology backwards. In this information cir cular on pages 10 and 11 , there is an item called specia l business of the meeting. Specia l business of the meeting is the stock option plan and the approval of that plan. There are quite a lot of details, approxima tely a page and a quarter in length.

It is a fairly detailed statement of what the plan contains, but it is very impor tant that the second-last paragraph be understo od, that this plan has been conditionally approved by the Toronto Stock Exchange, the Montreal Exchange and the Winnipeg Stock Exchange. Now, those exchanges do not as a matter of routine simply rubber-stamp a fax and send it back. I do not think it takes too much imagination to recognize that the board of directors must have approved this plan in March of 19 97 in order for it to be forwarded to the three exchanges with the approval of the board. January 7, 19 97, this Premier (Mr.

Filmon), this * (1410 ) -

April 8, 19 98 LEGISL ATIVE AS SEMBLY OF MANITOBA 1357 Now let me remind you that in March of 19 97, in February of 19 97, in January of 19 97, the only members of the board of directors of Manitoba Telecom Services were those members named in the 0/C of January 7, 19 97, that is, the 11 members appointed by the Premier and by the Finance minister. Now, Madam Sp eaker, let us further run that chronology backwards slightly.

If it were to go to the three stock exchanges subsequent to the approval by the board of direc tors, it would have had to go to those exchanges at least by March, which means that the compensation committee must have been doing their work in Febru ary, bare weeks after they were appointed by the Finance minister, the minister responsible for the system and the Premier (Mr. Filmon).

So within a very short period of time, a matter of weeks, the compensation committee was hard at work beavering away at developing a stock option plan that would enrich the chairman to the tune, at current values of the stock, by one million dollars. They did all of that work, every last stick of that work, prior to the meeting of the shareholders. It had been approved by the board of directors of the corporation prior to the meeting of the shareholders. It had been approved conditionally-because of the way the law is written-by three stock exchanges prior to the meeting of the shareholders.

The shareholders did not change one dot, one iota of what had been put forward by the compensation committee. So I believe that it is clear that there is a prima facie case that this government has misled the House, particularly the First Minis ter and the minister responsible, by indicating that they did not appoint a board, which in fact their own 0/C shows they did appoint, and secondly, that all of the work on the stock option plan was completed before there was ever a meeting of the shareho lders. All of those details were in place. I believe we have made our case. Hon.

Gary Filmon (Premier): Madam Sp eaker, I think it is important that you ensure that, in ruling on this motion of privilege, you ensure all relevant information is available to you on the matter. I want to emphasize a number of things that perhaps have been overlooked deliberately or otherwise in the prima facie case, and I understand the politics of why it is being done in this manner, but a great deal has been made of the fact that the chair of Manitoba Telecom Services is the brother of the current Mini ster of Finance (Mr. Stefanson).

What is important to note is that he has been the chair ofManitoba Telephone System since 19 89, prior to the election to office in this Legis lature of the current Minis ter of Finance. So, in fact, he was appointed much earlier and has had a significant history as chair of the board. Over the period of time since 19 89, his continuance as chair has been reconfirmed periodically at various interval s along the way, but he arrived at that position, as I say, prior even to the election of the current Minis ter of Finance to this Legisla ture.

So members opposite can make whatever case they want to, but this individual was appointed based on his competence and his capability, judged by obviously a government of the day prior to the arrival of the Mini ster of Finance to this Chamber. Madam Spea ker, another issue that I think is being overlooked.

The members oppos ite clearly have this information, because it was contained in the news release that was issued on December 2, 19 96, and it is entitled "Findlay Announces Proposed MTS Board of Dir ectors" and that board of directors that is being quoted from the Order -in-Council was in fact developed and initially announced to be appointed by the then minister responsible for the Manitoba telephone services.

What intervened between the announcement of the names and the production and signing of the Order- in-Council, of course, was the priva tization of the former Manitoba telephone services into Manitoba Telecom Services, in which case then responsibil ity transferred over to the Minis ter of Finance as the pro tern holder of the golden share on behalf of government. So in fact the announcement and decision, which members were well aware of, of who the board of directors were, was made much earl ier by the minister then respons ible. Again, they do not make a fuss over that.

They are attempting, I know, to make the political credit and take the political shots, and so that is conveniently set aside. Once in private ownership, the Manitoba Telecom Services no longer obviously was in the control of this Legis lature in any way. Our responsibility, as has been laid out on numerous occasions, was to ensure, through

13 58 LEGISLATIVE ASS EMBLY OF MANITOBA April 8, 19 98 the golden share provision, that the public interest in the public investment as holders of bonds was being looked after, and that continues to fall under the realm and responsibility of this Minister of Finance. But, I repeat, that company is no longer and was no longer in control of this Legisla ture or this minister or this cabinet. So the plan to provide the shares as compen sation was then developed for presentation to the annual meeting. Why, Madam Spea ker? Because, in fact, it could not be implemented by the board of directors, because (

a) No. I, they had not been confirmed by the shareholders as the board of directors, and so they did not have power to act, and (

b) they did not have power then to approve this without the vote of the shar eholders. So all of these things that were prepared in the interim by staff and by others and developed by the board of directors could have absolutely no relevance if the shareholders decided to do different things, and in fact the shareholders had the power to vote a different board of directors. That has been done, will be done in future by boards of private companies where they will take the recommendations of whatever is the nominating committee, and they will set it aside and put in place in fact different choices.

We all have read about that being done. We have all read about different directors being put in place. In private corpora tions, we have all heard about shareholder revolts or shareholders' democracy taking over corporations and new directors put in place. So in fact two things could have happened at the annual meeting: one, a different board of directors could have been in place; and two, the shareholders could have turned down the proposal that was put before them for consideration for compensation of both senior staff and directors and including the share option.

None of that did happen because in fact the vote of the shareho lders did both confirm the directors and the compensa tion package . All of those things, though, did happen only after the new board was put in place, and in fact then it devolved to our area of authority which was that we had the authority to appoint only four of the II directors, which did not include Mr. Thomas Stefanson, the chairman. They were separately and independently elected by the shar eholders of the new privatized Manitoba Telecom Services.

So you will find, Madam Speaker, that in nothing that was said by either myself or the Mini ster of Finance (Mr. Stefanson) did we mislead or place false information on the record, that this is all a pipe dream of the member for Thompson (Mr. Ashton) and his colleagues who have, obviously, a very serious fixation about this particular issue with Manitoba Telecom Services, an issue which they will never ever let die, and that is their right. That is their right, because for them it is all politics. That is all they live for; that is all they work for.

They do not work for the best interests of the people of Manitoba. They only work for their own political interest. Mr. Gary Doer (Leader of the Opposition): Briefly to the point of privilege raised, Madam Sp eaker. Over the last two days on April 6 and 7, the Premier (Mr. Filmon) on four occasions and the Minister of Finance (Mr. Stefanson), the minister responsible for the golden share, repeatedly stated in this House and in Hansard that the only appointees to the board of direc tors were the four so mentioned.

They failed to mention that on January 7, 19 97- An Honourable Member: The current board of directors. That is all we are talking about. Mr. Doer: You know, I did not interrupt the Premier. Perhaps the Spea ker could hold the Premier accountable in this Chamber. Madam Speaker: Order, please. As I indicated earl ier, this is a very serious matter, and I would request the co-operation of members on both sides of the House in listening to the member presenting the reason for a prima facie case being established. Mr.

Doer: As I stated, the Order -in-Council sig ned on January 7, 19 97, appointed Thomas Stefanson to chair the board of directors. That was signed by the Premier (Mr. Filmon). It was further signed by the minister responsible for the golden share . That is what we asked on Monday and Tuesday in terms of the individual in question, in term s of the $I -million stock option bonus. That is the question that the Premier and the Minister of - - -

April 8, 19 98 LEGISLATIVE AS SEMBLY OF MANITOBA 13 59 Finance (Mr. Stefanson) in our view misled the House and misled the public and contradicted an Order-in Council that was signed by them, and it is clearly on the public record, which is the essence, the absolute essence, of the point of privile ge today in this Chamber. Now, Madam Speaker, the Premier goes on to talk about Mr. Stefanson was appointed in 19 89. We have not disputed that. If Mr.

Stefanson had been appointed in 19 89 and had received a million dollars in stock option bonuses with the old minister of Telecom Services or some other minister, it would have been a matter of Tory greed. It would have been, pure and simple, a matter of Tory greed, a political issue of the Tories selling a public asset and that public asset in tum being turned over for the priva te gain of a well-known Tory, and that would have been just simply Tory gre ed, but it goes beyond Tory greed.

It goes beyond Tory greed, because you have a situation today where the person who appoints the person who ends up getting a million dollars is in fact the brother of the same person. You have the person who is given the respo nsibil ity of maintaining the golden share-! refer back to two weeks ago Thursday when the former minister of telecommunications went on repeatedly in the Interim Supply and said over and over and over again the Minist er of Finance holds the golden share. * (1 420) So here you have an individual that is responsible for the public interest.

He is responsible for the public interest of the Manitoba Telecom Services. He has been appointed by his Premier, and I would say put in a horri ble situation, compounded by the fact that he did not realize he was in an unethical situation-he has been appointed to deal with our share and the debt that is owing to the taxpayers. So he is responsible for ensuring that the maximum amount of money that is owed to the public of Manitoba through the share offering be returned to the debt repayment as the holder of the golden share.

He is not responsible as the holder of the golden share for allowing obscene bonuses to be given to well-known Tories when it is against the public interest of claim centre s, rate increases and debt repayment. So if we were to look at Mr. Stefanson in his former capacity, it is Tory greed. If we look at him now in the relationship to the minister responsible for the Telecom Services holding the golden share, being the brother of the same person who is making the million dollars, regrettably that is Tory ethics.

The point of privilege today is focused in on not dealing with the relationship of the golden shareholder and the chair of the board and the Order -in-Council on January 7, on April 6 and 7 and 8 of this year. Madam Sp eaker, we think it is obscene that people are making millions of dollars, and we say that that is Tory greed, but we say the ethics of this issue go way beyond that. The Premier does not see it. The Minister of Finance regrett ably does not see it, but we on this side see it, and that is why the point of privilege today. Madam Speaker: A matter of privilege is a serious concern.

I will take this matter under advisement to consult the authorities and will return to the House with a ruling. Manitoba Telecom Services Stock Option Plan Madam Speaker: To resume Question Period. The honourable member for Thompson, with a final supplem entary question. Mr. Steve Ashton (Thompson): On a new question, Madam Sp eaker. We are seeing again just how little this Premier and this minister responsible for MTS understand the gravity of the situation we face.

Not only did this Minister of Finance appoint the 11 -person board, including his brother, but this was the board, the slate that ended up being the final slate of MTS. It is also the board that solicited proxies as part of this circ ular. This is standard practice in the corporate world. So what happened was by the time this came into the shareholders' meeting-by the way, the First Minister (Mr. Film on) had it wrong because, according to his own Order -in-Council, those directors are in place until the end of the first shareholders' meeting.

Why will the Minis ter of Finance not admit that what he set in place was a done deal that resulted in his brother getting a million dollars at the expense of the public of Manitoba? Hon. Eric Stefanson (Minister of Finance): Madam Speaker, all I can do for the benefit of the member for Thompson is basically repeat myself and repeat the

13 60 LEGISLATIVE ASSE MBLY OF MANITOBA April 8, 19 98 answers to similar questions that he has asked over the course of the last couple of days. First of all, stock option plans are nothing unique to MTS. They actually exist in all telecommunication companies across Canada, many other companies. If he goes back and looks at the information circular, he will see that the information circular provid es the concepts of a plan; it provides the parameters of a plan.

As I have read it into the record on at least one other occasion, it provides for options not to exceed 3.5 million common shar es, which basically represent about 2.5 percent or thereabouts of the total shares issued. So back in May of 19 97, I believe on May 30 of 19 97 at the shareholders' meeting the stock option plan concept was ra tified, and as they said in the cir cular itself, the board of directors shall administer the plan. The administra tion of that plan was put in place during 19 97-98. Those details have been provided publicly and were provided to us within the last couple of weeks. Mr.

Ashton: What does it take for the Premier, for the minister responsible for MTS to recognize that what happened was that they set in place a slate, they drafted the slate that was adopted at that meeting, they put in effect a slate that was in control of MTS right up until the end of that first meeting, and that slate which included the brother of the minister responsible for MTS ended up making a recommend ation, a fine-a done deal that ended up in that brother getting one million dollars? Do you not understand that is unethical in the eyes of every single Manitoban who has any concept of fairness? Mr.

Stefanson: Madam Spe aker, as has already been pointed out in this House back on December 2, 19 96, a press releas e was issued by the minister responsible for MTS at the time, outlining the individuals who were being appointed to the board. A shareholders' meeting was held on May 30, 19 97, where the 70,000 sharehold ers who owned the shares in MTS and are concerned about the performance of MTS had an opportunity to vote for the directors of MTS. They voted in seven directors to the board; we appointed four other directors that we have read into the record.

Later on in that same meeting a concept for a stock option plan was again put before the shareholders. The sharehold ers of MTS ra tified the concept of a stock option plan. There is a meeting coming up in April of 19 98, and once again, as is always the case with all companies, the board of directors will be held accountable by the shareholders of MTS. Madam Speaker: The honourable member for Thompson, with a final supplemen tary question. Mr.

Ashton: Madam Spea ker, why does the Mini ster of Finance, in this case the minister also responsible for MTS, not understand that the people of Manitoba want him accountable for his unethical actions in appointing his brother, 10 other directors that came in with this done deal, in fact at a time throughout which, up until this day, he has been the minister responsible for the special share, the golden share that the government holds in MTS?

Why does he not understand that he is directly responsible for what has happened and the unethical breach in this case which is leading to his brother getting to be an instant millionaire at the expense ofManitobans? Mr. Stefanson: As Minister of Finance and the holder ofthe golden share ofMTS, I certainly am responsible for the proper repayment of the debt that is owing back to the taxpayers of Manitoba. When MTS became privatized on January 7 of 19 97, as I have indicated, the debt owing back to the government was $426 million.

Today that debt is now down to $239 million, almost $200 million paid back by MTS to the taxpayers of Manitoba. That is certainly one thing that I am responsible for, and they are on trac k, ahead of track in terms of repaying that debt. When it comes to the protection of the public and the consumer in terms of rate and service, as we all know, the same process is in place where CRTC would regula te MTS under private and public, and as I have said before , today in Manitoba we have the lowest resid ential rates for telephone companies in all of Canada, something we should be very proud of, Madam Spe aker.

Registered Nurses Shortage Mr. Kevin Lamoureux (Inkster): Madam Speaker, my question is for the Mini ster of Health. If I were a registered nurse in the province of Manitoba, I would be somewhat confused in the sense that a couple of - -

April 8, 19 98 LEGISLATIVE ASSEMBLY OF MANITOBA 13 61 years ago it seemed that we had registered nurses being laid off at different facilities and so forth , and we had registered nurses leaving the province. Today, in fact, what we have is hospitals now trying to recruit registered nurses. My question is: I am sure that these registered nurses would like to see some form of stability; can the Minis ter of Health give us any indication, is there a shortage of registered nurses in the province of Manitoba today? Hon.

Darren Praznik (Minister of Health): Madam Speaker, the member for Inkster asks a very impor tant question about our whole situation with nursing, and as we look at numbers, there is some expectation, in the years approa ching, that if current trends continue we could be short of nurses in a variety of areas .

I think and believe very sincerely that the key to managing this problem does come with part of the tools at the Winnipeg Hospital Authority, and the cases Winnipeg will have with the ability to have a common employer to be able to do staff planning on a regional basis will go a long way to dealing with some of the issues that are impor tant in recruitment that the Manitoba Nurses' Union has raised and also to better plan and move nurses around the system as they are needed. * (14 30) Mr.

Lamoureux: Madam Spe aker, will the Minis ter of Health acknowledge that what is most impor tant is there has to be a sense of stability? A registered nurse has to feel in fact that they have the opportunity to practise what they have been trained to do, that one year they cannot hear that they are going to be laid off and the next year they hear that there is going to be some sort of a shortage. Will he acknowledge that to be the case? Mr.

Praznik: Madam Speaker, not only will I acknowledge that here today, because that is absolutely correct what the member says, but we have been advocating over the last number of years, and that is why in fact the Winnipeg Hospital Authority in the case of Winnipeg, having the ability to be able to tra nsfer staff with seniority with their benefits throughout the system as needed, goes a long way to providing that security. Over the next month or year or so as Miser icordia changes its function, there are some 250-plus acute care nurses in service at that facility who will be needed throughout the system.

We will not have stability if we have individual facilities being the employer having to lay off staff and forcing them to reapply for other positions, and that is why we have been taking the stand that we have had with respect to common employing authority in the Winnipeg Hospital Authority. Health Care System Role of Nurse Practitioners Mr. Kevin Lamoureux (Inkster): Madam Speaker, again I would ask the Mini ster of Health to recognize that we will not have that stability if in fact there is no broader plan that does deal with the employment of our nurses. Madam Speaker: Order, please.

Does the honourable member have a question? Mr. Lamoureux: Yes, Madam Speaker, and the question is to the Minister of Health with respect to the nurse pract itioners, an issue which I have brought up to the Mini ster of Health and the previous Minis ter of Health: is the government moving ahead with the idea of bringing nurse practitioners more into the province of Manitoba to again deliver a better quality of health care to all Manitobans? Hon. Darren Praznik (Minister of Health): Madam Sp eaker, the concept of a nurse practit ioner is a very good one.

As I am discovering in this portfolio, there are some important prer equisites to make that work. Obviously, being able to deal with the College of Physi cians and Surgeons for overlaps of authority, having alternative mechanisms of remunerating physicians that encourage the development of prima ry health care teams with nurses becomes very, very important for that to work. I am hoping over the next number of months, as we get into negotiations with the MMA , we will be able to develop some of those models that are an important tool in seeing nurse practitioners develop in our province.

13 62 LEGISLATIVE ASSEMBLY OF MANITOBA April 8, 19 98 Home Care Program Privatization-Contract Extension Mr. Dave Chomiak (Kildonan): Madam Speaker, my question is to the Premier. Can the Premier clarify what government policy is with respect to the Olsten contract? Is it the minister's statements of several months ago that the contract would end in four months? Is it the minister's statement yesterday in the House when he said there would be an extension of the contract, or is it the sta tement of the minister in the hallway when he said the contract would not be extended? What is the government policy? Hon.

Darren Praznik (Minister of Health): Madam Sp eaker, the real issue in home care is not whether or not an Olsten contract continues for a month or two for a tra nsition, unless of course, as the New Democrats would suggest, we should put patient care at risk and not have service for individuals. Madam Speaker, we embarked a year or so ago on a process to test our home care system. We entered a tendering process. I have discussed that in the House. We had one successful bidder.

Their contract expires, I believe, at the beginning of May, and there is provision to allow for a tran sition to whatever the successor program is. There is also provision with the Manitoba Governme nt Employees Union for a review of that contract. We have talked about that over and over again in this House, and it continues. Mr. Chomiak: My question again is to the Premier (Mr. Filmon), who supposedly is a manager of our public resources. My question to the Premier is: how is it that a contract that Olsten says has been extended would be worth $3 million of home care money-$3 million of patient care?

How is it that the Premier cannot tell us whether or not the minister's conflicting statements are either the contract is renewed or the contract is not renewed? What is the answer to this $3- million question? I think taxpayers and patients deserve an answer. Mr. Praznik: Madam Sp eaker, I understand that the one-year contract with Olsten, the contract expiry date is May 1. There is some pro vision for extension to accommodate a tra nsfer to the successor if that is required.

During the course of this year, another factor has entered into this that I have conveyed to the member for Kildonan, and that in fact is that home care in the city of Winnipeg is no longer delivered by the minis try but as of April 1 has moved to the Winnipeg long-term care, continuing care board. They have to be in a position to gear up the staff to be the successor to that contract. Surely to goodness members of the New Democratic Party would want a smooth tra nsition for the patients involved. This side of the House believes very, very strongly in putting patients first.

Madam Speaker: The honourable member for Kildonan, with a final supplemen tary question. Mr. Chomiak: Madam Speaker, my question is to the Premier. How does the Premier reconcile the statements of his Minis ter of Health who said yesterday in the hallway that the contract would not be renewed, when a vice -president of Olsten said the contract was continuin g, when Olsten is getting new clients every week according to their own information, when the Mini ster of Health said four months ago that the contract would not be renewed?

Madam Speaker, is there any wonder people do not have any confidence in the ability of this government to manage health care in this province? Is it any wonder that it is in the disastrous state that it is in as a result of this Premier and these continuing ministers of Health? It is incred ible. Mr.

Praznik: Madam Speaker, if tenders go out for a new process of service delivery, then we can have the debate on the future of health care, but surely to goodness, that members opposite to be critical of the Winnipeg Long Term Care Authority or the ministry in wanting to ensure a tra nsition and patient care just makes absolutely no sense. In fact, administra tively, home care has now passed to the Winnipeg Long Term Care Authority. They are managing the end of this particular contract with Olsten.

They are entitled to have some leverage, to have a smooth transition to meet their No. 1 responsibility, which is not to play the politics of the New Democratic Party but to put patient care first. It is - -

April 8, 19 98 LEG ISLA T1VE ASS EMBLY OF MANITOBA 13 63 our respo nsibil ity to ensure that every home care patient has adequate service during that tra nsition. Ross Family Arbitration Award Mr. Eric Robinson (Rupertsland): Madam Speaker, my questions are for the Mini ster respo nsible for Manitoba Hydro. On the 30th of March, this government lost yet another arbitra tion decision concerning Cross Lake, and I understand that the government is not going to be appealing this decision, unlike the bridge decision that the government continues to stall funding on.

I would like to ask the minister: how long will the Ross family have to wait for this government to settle their claim concerning the death of their loved one, Benjamin Ross? Hon. David Newman (Minister charged with the administration of The Manitoba Hydro Act): Madam Speaker, this is one ofthe 12 6 claims pursuant to the Northern Flood Agreement, 19 77, 73 of which have been resolved by agreement or other wise, 26 active, 27 inactive.

This is one of them that has been decided, and Manitoba Hydro has advised me and advised the public that they will be honouring this award, and they will be honouring the award with all due dispatch in accordance with the spirit of the Northern Flood Agreement, 19 77. * (1 440) Northern Flood Agreement Personal Injury Claims Mr. Eric Robinson (Rupertsland): Madam Speaker, according to Chief Roland Robinson of Cross Lake, he says that there has been at least a dozen deaths or injuries caused by Hydro.

I would like to ask the minister: will the families of these dozen other victims of changes to water levels have to go to court in order to obtain justice, or will this minister now agree to settle these claims? Hon. David Newman (Minister charged with the administration of The Manitoba Hydro Act): Madam Spe aker, I apprecia te this question because it allows to clarifY a record of substantial misinformation.

The fact is that personal inju ry claims pursuant to the Northern Flood Agreement, 19 77, are claims that have been received and have been honoured, in some cases by agreement before they ever went to arbitration and in some cases pursuant to an arb itration award. The Northern Flood Agreemen t, 19 77, provides a specia l treatm ent and a favourable chosen treatment agreed to by the parti es for personal inju ry claims. These claims can be by agreement, are settled by other negotiation or by arbitra tion, rather than the costly court process with all the appeal processes involved.

So this is the process that is followed even in those areas that have agr eed to a comprehensive settlement. Cross Lake First Nation-Review Mr. Eric Robinson (Rupertsland): Given the arbitrator 's decision last week, Madam Speaker, I would like to ask the minister now to review his position concerning the Northern Flood Agreement and Cross Lake. Will he review that position? Hon.

David Newman (Minister charged with the administration of the Manitoba Hydro Act): Madam Speaker, I of course have reviewed not only Manitoba's position historically under the Northern Flood Agreement, 19 77, since I have become minister, but I also reviewed the performance of Canada and Manitoba Hydro under the Northern Flood Agreement, 19 77, and that is why I think it is useful to understand some of the statistics and understand that $37 million have already changed hands and gone to the Cross Lake community of peoples.

Seventy-three out of 12 6 arbitra tion claims or claims under the Northern Flood Agreement have been resolved. Twenty-seven are inactive by the choice, primarily, of the Cross Lake claimants and 26 are currently active. All of them are being pursued with appropriate due diligence. I have indicated with respect to the all-weather road claim, that that is one that I am particularly interested in reviewing. The difficulty we have is the Cross Lake Band coming forward to indicate what they really want and what they understand to be the spirit of the Northern Flood Agreement. Manitoba Telecom Services Layoffs Mr.

Stan Struthers (Dauphin): Madam Sp eaker, in the fall of 19 96, I challenged every member across the

13 64 LEGISLATIVE ASSEMBLY OF MANITOBA April 8, 19 98 way to come to my constituency and explain the reasons why they were selling of f the Manitoba Telephone System, none of whom took me up on that challenge, by the way. To the Min ister of Finance, I would like him to come to Dauphin and explain why our community is losing 24 jobs and explain to them why they have to suffer while he makes a millionaire of his brother. Hon.

Eric Stefanson (Minister of Finance): Madam Sp eaker, as we have indicated before, decisions that MTS are making today are basically similar decisions that they would make under a public or a private entity. Look at some of the adju stments to staffing that were done by MTS; many of them were done prior to priva tization because of the competitive nature of telecommunication.

The telecommuni cation industry here in Manitoba today, some 70 percent to 80 percent of MTS's business is now in competition, so they are making those adju stments, but in terms of the protection for consumers, for Manitobans, there is a reg ulatory process that they go through. CRTC reviews any rate requests, reviews any other expenditure adjustments and issues, and again, that is a process they would go through under private and/or public ownership.

When they were making their adjus tments on their staffing, I am told that in every instance they attempted to offer either voluntary separa tion incentive plans, redeployment oppor tunities, and even with all of the downsizing they did during their public sector time, they were able to keep layoffs down to an absolute minimum. Dauphin Phone Centre Mr.

Stan Struthers (Dauphin): Can the minister assure my constituents that the future of the Dauphin phone centre, a phone centre that could fall on the same hard times that the Swan River phone centre has under this government-o r Portage or other areas in the province-can he assure the people of Dauphin that their phone centre is secure, or will it, too, be closed so that more profits can be turned over to his friends and relatives? Hon. Eric Stefanson (Minister of Finance): Madam Speaker, MTS will obviously look at the requirement to deliver services, and they do deliver services right across the province.

They will continue to look at providing them in as efficient a way as they possibly can to continue to keep rates as low as possible for consumers, and today, as I have said many times in the last few days, our residential rates in Manitoba are the lowest of any province in all of Canada. That certainly is welcome news for the consumers, for the public here in Manitoba, but in terms of how they function, they will continue to make decisions that allow for them to oper ate in an effective and an ef ficient manner. Minister Responsible for MTS Conflict of Interest Mr.

Stan Struthers (Dauphin): Does this minister not realiz e that by choosing his friends and his relatives overtop of the needs of Manitobans and the telephone system, he is clearly in a conflict of interest? Hon. Eric Stefanson (Minister of Finance): Madam Sp eaker, I am not choosing friends or relatives or anybody over anybody else. I have indicated on several occasions what the process is for any rate adjustments for MTS. They go through a review process with CRTC . We saw evidence recently where MTS was requesting a rate increase, I believe, in excess of $3. Members opposite were making a big to-do about that.

We said to them there is a process that they have to go through which is the same process whether they are under public or private. They went through that process, and the rate increase that they were ultimately allowed, I believe, was 84 cents, one of the lower adjustments in all of Canada. So there is a process that does protect the consumers; that is the same process under any kind of a structure .

Madam Speaker, I have already outlined for the member opposite the job that MTS is doing in terms of repaying their debt to the taxpayers of Manitoba, that they have now repaid almost $200 million of the debt that was owing to the taxpayers of Manitoba. * (1 450) Manitoba Telecom Services Layoffs Mr. Jim Maloway (Elmwood): Madam Spea ker, my question is to the Premier. A group of 22 MTS --

April 8, 19 98 LEGISLATIVE ASSEMBLY OF MANITOBA 13 65 employees were fired on March 25, '98, plus another group were fired on March 20 just before they were due to go on vacation. Meanwhile, the board of directors, including the brother of the Finance minister, have rewarded themselves with million-dollar stock options, and rates are going up. I would like to ask the Premier: is this an example of Tory fairness, to reward family and friends at the expense of employees and the ratepayers of Manitoba? Hon.

Gary Filmon (Premier): Madam Speaker, of course when the member opposite sat on this side of the House as a member of government, his preferred way of dealing with the Telephone System was to take $27 million of ra tepayers' money from Manitoba and just dump it on the sands of Saudi Arabia, with no jobs being created in Manitoba and $27 million of taxpayers' money being wasted in Saudi Arabia. Some Honourable Members: Oh, oh. Madam Speaker: Order, please. Time for Oral Questions has expired. MEMBERS' STATEMENTS Federal Government-Request Mr.

Jack Penner (Emerson): I rise today to recognize that the federal government took 700- Madam Speaker: Order, please. We have moved on from Question Period to Members' Statements, and I am experiencing difficulty hearing the honourab le member for Emer son who was recogniz ed. Mr. Penner: I rise today recognizing that the federal government two years ago took $750 million out of the farmers of western Canada regarding the Crow rate, and that is every year from here on hence.

The federal government at the same time takes a huge amount of money out of the taxpayers and the users of the transportation system in western Canada in fuel taxes. I think, Madam Speaker, it is high time that Ottawa started pumping gasoline tax revenue back into western Canada. While the eastern pro vinces cruise along on a full tank, we are running on empty.

I think it is high time that we recognize that the $900 million allocated to infra structure in eastern Canada need also to be recognized in western Canada, and I am asking today that this House would support going to Ottawa and asking Ottawa to give us some of the gasoline tax revenues to build our roads and our infrastru cture. I also ask for support to ask Ottawa to give us part of the Crow benefit back, instead of transferring all this money to eastern Canada.

Chris Lorenc of the Manitoba Construction Assoc iation pointed out that the federal government is devoting less than 2 percent of its transportation investment to western Canada over the next five years but that the eastern pro vinces, many of them with Liberal governments, are being treated to high-octane transporta tion funding.

Madam Speaker, I am asking only that we in western Canada, especially in Manitoba, be given back some of our high octane, be given back some of our taxation, that we can provide transportation and transporta tion routing into much of our province and indeed see that value-added process continue. Manitoba Telecom Services Mr. Gerard Jennissen (Fiin Flon): Following the 19 95 pro vincial election, the Filmon government broke its prom ise and announced that the Manitoba Telephone System would be sold off. The decision outraged Manitobans in every region of the pro vince.

Prior to the sale, we had the second-lowest phone rates in North America. MTS kept local rates low as a way to both attract business and keep service affordable. Manitoba was one of just a handful of provinces in the country that had direct-dial phone service no matter where you lived. MTS had workers in every region. This is being scrapped. Flin Flon, Morden, Dauphin, Selkir k, Swan River, Steinbach, The Pas, Minnedosa and Portage Ia Prairie are just some of the communities that are losing jobs. MTS has increased local rates twice this year and is now requesting another increase for next month.

MTS was deliberately underval ued when it was sold to guarantee that it would do well on the stock market. As a result, Manitoba taxpayers lost as much as half a billion dollars in the sale of the company. Stockbrokers

13 66 LEGISLATIV E ASS EMBLY OF MANITOBA April 8, 19 98 made more than $35 million. Even bigger winners were the friends of the Progressive Conserva tive Party . The head ofMTS, Thomas Stefanson, was appointed to his job by Gary Filmon and Eric Stef anson. Thomas Stefanson is the brother of the Manitoba Finance minister. Thomas Stefanson can make $1 million ifhe- Madam Speaker: Order, please. The honourable government House leader, on a point of order. Point of Order Hon. James McCrae (Government House Leader): Two points, Madam Sp eaker. Very recently, the honourable member for Br andon East (Mr.

Leonard Evans) raised the issue of members reading their comments in members' statements, and you will recall what I said at the time: that it would have been just as well if the honourable member for Brandon East had not raised that matter. But the reason I rise has more to do with the tendency, and today I will say especially for members of the New Democra tic Party , to speak in the second person in this House. Honourable members, I respec tfully suggest, need to be reminded again that comments are to be put through the Spea ker.

In other words, you are not to refer-w e as members are not to refer to the honourable member for Concordia, for example, by his name. We are not supposed to do that, and yet members opposite are doing it daily, including the Leader of the Opposition (Mr. Doer). I am with the honourab le member for Brandon East, who cares a little bit about parliam entary trad ition. I do, too, and I raise this for that reas on. Madam Speaker: Order, please. The honourable member for Thompson, on the same point of order. * (1 500) Mr. Steve Ashton (Opposition House Leader): The same point of order, Madam Sp eaker.

I think if the government House leader were to reflect on the first part of the supposed point of order, he would notice that the member for Flin Flon was really just quoting from detailed notes. I think, on the second score, I would say that the government House leader does have a point. It is somewhat difficult for us on this side, though, when we have a government that refuses even to run elections on its own party name and runs under the name of its Leader, the Filmon Team. I would also suggest that the government House leader may wish to make sure that some of his members, as well, do the same thing.

I would actually agree with the point of order raised by the government House leader. We should be referring to members by their ministerial title or their constituency. The government House leader is quite right. Madam Speaker: Order, please. On the first point of order raised by the honourable government House leader, I did take that matter under advisement yesterday, and I will be reporting back to the Chamber so there is consistency.

On the second point of order raised by the honourable government House leader, as agreed to by the honourable House leader of the official opposition, indeed he did have a legitimate point of order. I would remind all honourable members to refer to members in this Chamber either by their constituency or their portfolio. * * * Madam Speaker: The honourable member for Flin Flon, to continue. Mr. Jennissen: Madam Spea ker, I stand corrected. The brother of the current Finance minister can stand to make $1 million if the shares that he has are sold. Other MTS executives are able to make quite a bit of money as well.

At the same time, we know that 450 jobs have been cut since the sale ofMTS. None of the promises made by the Filmon governmen t have been kept. Less than 20 percent of the shares of MTS are now held in Manitoba hands. As well, we have every reason to believe that Manitoba Hydro is being slated for sale. We have the lowest residen tial hydro rates in North America. The Filmon government did not have a right to sell MTS or to privatize our health care system. It does not have the right to sell Hydro either. The government should ease off the pork barrel - -

Apri l 8, 19 98 LEGISLATIVE ASS EMBLY OF MANITOBA 13 67 politics. This government should scrap its privatization plans. Brandon Royal Winter Fair Mr. Peter Dyck (Pembina): Madam Speaker, it is my pleasure to rise today to congratulate all of the directors and the volunteers of the Royal Manitoba Winter Fair. Once again they did a fantastic job of organizing and hosting this wonderful event. The Winter Fair was held in the Keystone Centre in Brandon from March 30 to April 4. Last week on MLA day I had the pleasure of attending the fair, along with many of my colleagues from both sides ofthe House.

I cannot emphasize strongly enough what a great event this is for Manitoba's producers . There was something special for everyone from seed displays and livestock sales to a petting farm showcasing young farm animals. The fair also provides valuable educational experience for individuals who are not familiar with our province's agricultural industry. I would like to congratulate all who partici pated in the many horse, cattle, swine and pou ltry shows. Judging from the shows I was able to observe on April I, the competition this year was as competitive as ever.

The agricultural industry is an integral part of Manitoba's economy and is responsible for the crea tion of one out of nine jobs in our province. For that reason, the organizers of the Royal Manitoba Winter Fair need to be applauded for giving Manitobans the opportunity to learn more about one of their most impor tant industries. With that, I would like to congratulate the directors of the winter fair and the many volunteers who spent their spring break ensuring the fctir was such a success. I wish them all good luck with the next year's fair as they try to surpass this succes sful year. Thank you very much.

Manitoba Telecom Services Ms. Jean Friesen (Wolseley): I wish to make a member's statement on the issue of the Manitoba Telephone Sys tem and to draw to members' attention the shameful way in which this government has conducted itself. This was a government which came to power on an election promise that it would not sell the Manitoba Telephone System. It proceeded to do that. This was a government which road roughshod in the House over the rights of members of this House in order to sell that telephone system.

This was a government, Madam Spea ker, which compromised your position in this House and continues to compromise your position by the effects of that action in the House. Anger was high in the House at that time, and no one who was here on that occasion will forget it. And deservedly it was high, because what the government was doing was taking assets from the hands of all the people out ofthe public and into the private, taking assets which belonged to all of us and transferring them into the hands of a few. It was a shameful betrayal of the common wealth of Manitoba.

Today, Madam Spea ker, we hear about a board appoin ted by the government which appears to have laid the groundwork for enormous stock options for itself. I want to say the government, which claims that this is normal corpor ate practice, must understand that this is not the normal pract ice on my street. This is not the normal practi ce, of lining one's pocket, in my constituency. It is not normal to do this. It is not right, and the government simply cannot see this.

I want the government, when it thinks about this, to think about my constituents who have seen the loss of jobs, hard-working Manitobans, many of them who devoted their lives to the Manitoba Telephone System, hard-working Manitobans who have lost their jobs throughout rural Manitoba and within the city of Winnipeg, hard-working Manitobans who now see across the province that they have no service in the way which they used to.

Madam Speaker, I ask the House to look at the news today from the perspective of my constituents, to look at those golden stock options and to join with me in expressing my sheer disgust at what this governmen t has done. Mr. Tim Sale (Crescentwood): Sorry, Madam Speaker, where are you in the Order Paper? Madam Speaker: We are still on Members' Statements, and according to our rota tion, we are

1 368 LEGISLATIVE ASS EMBLY OF MANITOBA April S, 19 98 entitled to five and today's rotation, the of ficial opposition is entitled to three. Mr. Gregory Dewar (Selkirk): Madam Speaker, in 19 96, when this government broke its promise to not sell the Manitoba Telephone System, the public was outrag ed. In fact, 78 percent of rural Manitobans opposed the sale of MTS-78 percent of rural Manitobans, and this government betrayed that trust of those Manitobans.

During the election, during that 19 95 election, this government also promised to spend $600 million on health care capital, and they also promised to save the Jets. Manitobans believed them on those issues. Manitobans voted for them, and this government betrayed those Manitobans. Now, Madam Spea ker, we have a situation here in the province where, because of the actions of the government in terms of MTS, we have workers laid off all across this province, in Flin Flon, Morden, Dauphin, Selkirk, Swan River, Steinbach, The Pas, Minnedosa and Por tage Ia Prairie.

We on this side of the House will stand up for those workers and those communities. I urge the members opposite who represent those communities to stand up in this Chamber and to stand up for the jobs of those workers, stand up for those workers as well as we are doing on this side of the House. Madam Speaker, Tom Stefanson as a chair ofMTS, he laid off workers, he raised rates and he was rewarded by a million-dollar stock bonus. That stinks. It is a shameful, shameful action of this government. MATTER OF GRIEVANCE Manitoba Telephone System Mr.

Tim Sale (Crescentwood): Madam Sp eaker, on behalf of my constituents, many of whom have called me on this matter, I would like to rise on a grievance in regard to the many things which this government has done to impoverish Manitobans through the forced and undemocratic sale ofthe Manitoba Telephone System. Madam Spea ker, in this Chamber, the ordinary business of the Chamber was set aside. The rules of the Chamber were set aside to drive through the undemocratic sale of this corporation. That was a low point in the history of this Legis lature.

It was precip itated by a Premier who promised a number of times, but specifically on CJOB and in constituency meetings, that he would not sell the Manitoba Telephone System. Madam Speaker, he had spoken falsely, obviously, because shortly after attaining government on the basis of that promise, and as my colleague from Selkirk has said, the promise to save the Winnipeg Jets, he broke both those promises. Madam Speaker, let us look at what has happened to my constituents,

part icularly to those in my constit uency who are low-income people. I had a phone call just this morning from a woman who is chronically ill, who has no option for her safety, for her personal safety has no option but to have a telephone. She has seen her phone rates go from just over $10 to just under $25 in a matter of a couple of years. The government likes to maintain that Manitobans have benefited because they have lower long distance rates. That is true . Manitoba companies have benefited from lower long distance rate s.

Wealthier Manitobans who can afford to use long distance have benefited from lower long distance ra tes, but many poorer Manitobans, many seniors, many chronically ill people have suffered from higher telephone rate s. * (1510 ) The woman who called me this morning has had her rates more than doubled in the last two years. She is saying: on my pension, on the money I receive for shelter, I cannot maintain a telephone; with my health, I must maintain a telephone. She is in a no-win situation.

If she meets her income needs to buy her medication and gives up her telephone, she gives up her security in terms of reaching health care when she needs it. This is a grievous situation for low-income Manitobans. Let us then move to what happened after the government undemocr atically sold this corporation by suspending the rules of this House. I will never forget standing at the back of this House completely -

Apr il S, 19 98 LEGISLATIVE AS SEMBLY OF MANITOBA 13 69 immobilized by rulings which prevented my speaking, my Leader spea king, my House leader speaking, to oppose an undemocratic ram-through of this sale. Madam Spea ker, within weeks of the sale, the minister responsible for the telecom serv ices, who is the Finance minister (Mr. Stef anson), and the Premier (Mr. Filmon), who had sold this corpora tion, signed an Order -in-Council, Order- in-Council No. 45 of 19 97, appointing the brother of the minister responsible and the man who turned out to be the head of the compensation committee, Mr. Sam Schellenberg.

Those people, along with the other nine appointees of this government to the interim board which served not until the annual meeting, as the Fir st Minis ter would like us to believe, not until the annual meeting, as the Finance minister and the minister responsible for the telecom system would like us to believe, but until the end of that meeting. In other words, they were still government appointees when they put forward the stock option plan which they had already cooked in Febr uary and March of 19 97, a plan, the details of which I believe were already well known to themselves and to others.

They had those details in mind, and we will show that in subsequent events. They made a millionaire out of a Manitoban whose only service to this province had been to assist his brother and the members of the government to ram through the undemocr atic sale of this corporation against the overwhe lming wishes of Manitobans, against the promise of the Premier not to do so. His only service was to shepherd through the sale. Madam Spea ker, I had both the honour and the sad privilege of sitting through every hour, every single hour of the committee hearings on MTS, and who answered the questions?

Jules Benson, the Minis ter of Finance. Who said in committee there will not be any further layoffs as a consequence of priva tization? Thomas Stefanson. Who said that rates would not rise? Thomas Stefanson. My constituents are outraged by the process that led to the sale, by the consequences of the sale, by the fact that the Minis ter of Finance's brother has been made a paper millionaire, been made a paper millionaire by actions of the board that was put in place by his brother on January 7, 19 97.

You know, the governmen t will assert that every other telephone system has a stock option plan and, you know, they are right. But there is also in the Toronto Stock Exchange regula tions and in all the regula tions of all the major stock exchanges in Canada a requirement that related family members not enrich each other without disclosure. They can enrich each other, but they have to disclose it. They have to put it on the public record. That is in the regula tions of the Toronto Stock Exchange. This minister enriched his brother, and he did not disclose it. He did not even see a problem.

He did not see a problem with signing an 0/C. putting his brother in place, and then he claimed not to know about the details of the stock option plan until the annual meeting. Well, Madam Speaker, my constituents have a great deal of difficulty with that statement, because they wonder how the minister responsible for the golden share-that is interesting, you know. All the members opposite have now started to use that phrase, and how apt it is.

The proper term is the special share, but the Finance minister says the golden share, the Premier says the golden share, the minister formerly responsible says the golden share . Perhaps it is Freudian or perhaps it just reflects the reality . That share has turned to gold for their friends, for their appointees, specifically for Tom Stefanson.

Well, in any other stock exchange in the world, brothers would not be allowed to enrich brothers without a full disclosu re of what was going on, so that other members of that corporation and members of the public would know that brother A appointed brother B who got a big fat stock option. Every other exchange in the world requires that, but not in this case. Brother A does not see what is going on here as a problem. Every Manitoban I have spoken to sees it as a problem. They understand that it smells to high heavens when brother A puts brother B in a situation to be enriched by the actions ofhis friends.

When this is happening in the context of the closure of important phone centre s in Portage, in Steinbach, in Morden, in Dauphin probably, these towns were promised that they would not see their stake in the

13 70 LEGISLATIVE ASSEMBLY OF MANITOBA April 8, 19 98 Manitoba Telephone System diminished. These towns were promised that they would continue to have the kind of presence that that company has provided as a public corpora tion owned by us all. I think perhaps the member for Kirkfield Park (Mr. Stefanson), the member responsible for the Manitoba Telecom Services, does not understand that in rural Manitoba we are not ju st talking about good services. We are talking about impor tant jobs, highly paid jobs, highly skilled jobs, to which rural Manitobans could aspire.

When you take away those kind of jobs, you take away a level of hope from the young people of those communities. You take away the sense that they can actually deliver some impor tant telecommuni cation services to themselves. They do not have to drive to Winnipeg. They do not have to get on the phone to the Faneuil corporation and ask for something to happen out of Winnipeg.

They could do it for themselves, and when those phone centres and service centres are closed, Madam Sp eaker, what happens is what a member of the telephone system who called an open line show on which I was a guest said to me just this week. I was raising the concern about the obscene stock options, and this gentleman phoned and he said I am still a member of the staff of Manitoba Telephone System, but he said I am very, very disheart ened. He said to the open-line show to the audience, never has morale been lower, never have we felt worse about the work we are doing.

This is a long-term employee of the company. What he went on to say was, Madam Speaker, it used to be that when customers called they got service quickly and effectively. It used to be that when we had a problem at a customer's house or at a customer's place of business, we could call on backup services that would quickly and efficiently offer their resources to solve the problem. He said not only now do people wait for service in the first instance, when we as employees call for backup support, it is not there anymore, he said. So people are doubly penalized. The quality of service is going down.

The cost of service is going up. The number of valued employees is going down, but the stock options are booming, and the stock price is booming. * (1 520) Let us remember that all across North America we have seen huge layoffs in the telecommunic ation industry and huge gains in stock prices. There is no surer way to enrich yourself as a member of the Board of Directors of the Manitoba Telephone System than to lay off more people. As soon as you lay off people, the stock price rises. So let us ask about a conflict of interest then. I have a stock option plan available to me.

I can enrich myself by the simple expedient of laying people off. Who has been laid off? Four hundred and fifty people have been laid off since this company went private. What has happened to its stock price? It has gone from $13 to $23 . What does that equate to, Madam Speaker? Well, that gain of $10 a share more or less equates to $700 million in nominal company value since this company was privatized. It was privatized for $9 10 million. According to the stock market today it is worth an additional $700 million.

That is value that was taken out of this province, transferred to shareholders in other parts of this country and in other parts of the world. Stockbrokers are telling us that less than 20 percent of this company is still owned in any way by Manitobans, less than 20 percent. So the great majority of that $700 million has not escaped into the pockets of a relatively few Manitobans. It has escaped outside this province, outside this country. The government told us what a risk it would be to keep this company because it was such a risky business. The stock market has passed its judgment on that foolishness.

The stock market says not only is it not very risky, it is worth $700 million more today than it was when you privatized it. The only thing that has happened between the date of privatization and today is that there are 450 fewer employees, and the chairman of the board, the brother of the minister responsible for the corpora tion, is a million dollars richer. That is the only thing that has happened. There is no new technology. There have been no new breakthrough s. There have been no new agreements that have enriched this company.

It is simply, we have got fewer staff, the stock market loves it, and the minister's brother is a millionaire. -

April 8, 19 98 LEGISLATIVE ASSEMBLY OF MANITOBA 13 71 That is the consequence of privatiza tion, while $700 million in value has flown out of this province, the biggest giveaway that has ever happened in the history of this province or, I dare say, in the history of any province in Canada. I do not believe any other province has given away such valm: and my constituents regret it. Mr. Stan Struthers (Dauphin): Madam Sp eaker, I rise on a grievance. The sale of the MTS by this Cons erva tive government is the biggest rip-of f in the history of Manitoba. It was not just a rip-off in terms of finances or economics.

It was a rip- off in the way that this Legisla ture has been treated by this dictatorial Premier (Mr. Filmon) and his cabinet and those who support him in the back benches. In Question Period today and earlier this week the Premier and the Finance minister (Mr. Stefanson) have told us that we need to look at the facts, that we need to be honest, we need to be truthful, and they claim that throughout this whole discussion about this his torical rip-off, the sale ofMTS, they claim that they have been honest with the people of Manitoba throughout this whole discussion.

Nothing could be further from the truth than the honesty of this governmen t when it comes to selling the publicly owned Manitoba Telephone System.

The reason that I rise on a grievance on this particular issue today is that I do not know how any of us, I do not know how I, as an MLA, am to represent adequately my constituents if we have to deal with ministers and first ministers who refuse to let their words match their actions, ministers and the First Mi nister who say one thing and do another, do not contribute to democracy in this province and, as has been mentioned in Question Period earl ier today by spea kers from the government side of th1s House as well, what is impor tant are the democratic principles upon which this building was built.

Key to a democracy is the honesty of the government . That, Madam Speaker, has been breached from day one in this MTS debate and, since the privatization of the Manitoba Telephone System, honesty is not a word that I would associate with this whole debate coming from the government. To begin with, Madam Spea ker, I remember very clearly, and the people of Manitoba remember very clearly, the words of this government pre- 19 95 election where they categorically, undeniably stated that they would not sell the Manitoba Telephone System. They went furth er.

They said the only person who was concerned about selling the Manitoba Telephone System was the member for Thompson (Mr. Ashton). The member for Thompson had the fore sight and the courage to point out that this government, if they were elected, would sell the Manitoba Telephone System. He was right. The facts prove the member for Thompson correct. Madam Sp eaker, in our own election campaign in Dauphin in 19 95, I confronted the PC candidate with the same suggestion, and I suggested to him that if we re-elected the Conservatives in the 19 95 election, they would sell MTS. He said no.

I was accused of being a fearmonger. Well, how hollow does that cheap kind of an accusation appear now? If I have to be called a fearmonger again and again and again and be proven correct again and again and again, I will do it again and again and again. This government was not honest with the people of Manitoba. They said they would not sell it. They turned around and they did. Their word cannot be trusted. In the House, during the debate on MTS, this government stated that there would not be layoffs because of privatiza tion. This government said that unequivocally in this House. What has happened since?

At least 450 Manitobans have lost their jobs because of this government' s dishonesty. Twenty-four, in the latest round in Dauphin, are losing their jobs. The community of Dauphin is getting kicked by this government to the tune of 24 jobs. In the Parklands area, we are losing a phone centre and in excess of 30 jobs. The Tories said that was not going to happen. Here we are today, it is happening. It is right there in black and white in front of everybody to see. This governmen t said there would be no rate increa ses, Madam Speaker, no rate increases.

How did this government expect to pay off the shareholders in the new company if they were not going to have rate increases or if they were not going to lay people off? That is what is happening now. Ins tead of a telephone system being managed on the basis of the public good,

137 2 LEGISLATIVE ASSEMBLY OF MANITOBA April 8, 19 98 it is now being managed on the basis of benefiting the few, the few which includes the Finance minister's brother, Mr. Tom Stefanson. Another promise that this Conser vative government made in the debate concerning the privatization of the Manitoba Telephone System was that they would keep it Manitoban. Manitobans would still be in charge of their company.

That was unequivocally wrong, and I suggest that the Tories knew that there was no way that they were going to be able to keep Manitobans in charge ofMTS once priva tization became reality. * (1 530) Madam Sp eaker, again, when we told Manitobans that they would lose control of their telephone system and that people from outside of the province and indeed outside of the country would become major and ma jority shareholders in this company, we were accused again of being fearmongers. Well, once again, the facts bear us out. We were right again.

The people of Manitoba were right because they understood that once you put this company up for sale, there was no way you were going to be able to control where those shares were going. The government knew that, we knew that, the people of Manitoba knew that. Still the government stuck to its story and sold MTS. Madam Spea ker, another little fib that the Conserva tives laid on us in the discussion of MTS was that we needed to sell the telephone system to get more capital to buy more technology to improve the system.

Well, they have accessed less capital to buy less technology and less equipme nt to improve this system now. The private company is not keeping pace with the investment that the public Manitoba Telephone System was doing before this government privatized it. Did this government have suppor t of Manitobans in doing this? You know, if you strike out and strike out and strike out time after time after time when you consider the facts, I can see you might be able to get your argu ment across if you have support of the people of the province. Well, it was the opposite.

They did not have anywhere near the support ofthe people of the province. The vast majority, 78 percent in rural Manitoba, opposed what the Conserva tives were doing; 60-some percent in the city of Winnipeg opposed what the Conser vatives were doing. Again, this government struck out, but this government proceeded on and, in an undemocra tic fashion, threw the rule book out in this House, suspended democracy in this province and rammed through the biggest rip-off in Manitoba history.

Now, today, this government is really struggl ing to try to rationalize for all the things that they messed up in this whole debate. We pointed out that there would be very few people who would benefit from this deal, and now we are being borne out on that as well. It is becoming absolutely crystal clear just who is going to benefit, on the backs of taxpayers, I might add. The people that are going to benefit are, No. 1, the stockbrokers who took in $35 million, the same stockbrokers who recommended this sale, who recommended the sell-of f of Manitoba Telephone System, collected in $35 million for doing so.

Before that, the profits were being turned back into Manitoba. We were eliminating party lines at a cost to the Manitoba Telephone System, but at the benefit of my constituents in Rorketon, Manitoba, who were some of the last people to have to put up with party lines. The publicly owned MTS solved that problem. Other ju risdictions where there are private telephone companies still have party lines.

The Manitoba Telephone System was looking at ways in which we could use fibre optics to connect different parts of our province, using fibre optics to connect us through distance education, something that is very much needed in rural Manitoba. What is the private MTS doing now about that? Where are they going with it? I would suggest, nowhere.

In specific to what was going on in Question Period today with the questions that were being asked and not answered by members opposite, in respect to what went on the day before in Question Period and on Monday in Question Period, it is absolutely clear that the statements made by both the Premier (Mr. Filmon) and the minister responsible for Manitoba Telecom Services are in absolute contra diction to the facts, in absolute contra diction to what is down in black and white. On the one hand, the Finance minister (Mr. Stefanson) says that he appointed only four people.

The Order -in-Council says that he appointed 11 , one of - -

April 8, 19 98 LEGISLATIVE ASSE MBLY OF MANITOBA 13 73 which is his own brother, Tom Stefanson, who was given, they call it, the golden share; Tom Stefanson, who, who could stand to gain a million dollars was appointed through Order -in-Council by his brother, the Finance minister (Mr. Stefanson), to a position where he stands to gain a million dollars. That is exactly opposite to what the minister told us in the House. That is basis for a grievance.

How can I go to my constituents and try to explain what is going on in this House if the Finance minister will not give me the whole truth about the issues we are dealing with? That is the case with this deal, a deal which every time we kick it, smells a little bit worse. In black and white there is a circula r containing the government' s plan for this stock option, and the circular approves, before any shareh older's meeting, this plan, a plan put together by the appointed brother of the Finance minister through Order- in-Counc il, a plan put together by Mr.

Schellenber g who is the chair of this committee appointed by the current Finance minister. It is absolutely clear that if we in this House expect to serve our constituents, if we in this House want to go from the Legisla ture to our constituencies and explain what this governmen t is up to, with any hope of being fair, then we have to deal in honest terms. We have to deal with the facts, not the spin that the Premier (Mr. Filmon) or the Finance minister want to put on this but the honest-to-goodness facts.

I, as a member of the Legis lature, cannot go to my people in the Parkland and put forth the government's position as portrayed by the Finance minister, and I cannot talk about any kind of good things that this government claims to be doing when they do not give me the truth . Thank you, Madam Sp eaker. Mr. Gregory Dewar (Selkirk): Madam Speaker, I rise on my grievance. In 19 96, Manitobans were furious when this government broke their promise and sold the Manitoba Telephone Sys tem without consulting the Manitoba public.

As my colleague from Dauphin mentioned, against the wishes of over 78 percent of rural Manitobans who were polled at that time, 78 percent of rural Manitobans opposed the sale and the priva tization of the Manitoba Telephone System, yet this governmen t went ahead against the wishes of the majority of Manitobans and sold off the telephone system. During that election as well the governmen t also promised, and all of us here remember that, of course, to maintain Pharmacare . They promised to spend over $600 million on health care capital spending, and they also promised to save the Winnipeg Jets.

They promised $600 million for capital health care, and they also promised to save the Winnipeg Jets. There are Manitobans out there who believed them, and there are Manitobans who went and supported them because of their promises. Well, the government opposite and these members opposite, they betrayed the trust of those Manitobans because they did not spend the $600 million in capital like they promised. If they had done it then, we would not be facing some of the problems that we are facing currently in health care. They kept promising a person al care home in Oakbank. The sign is still up there.

They have to go at re-election and repaint it: Coming soon to your community, a personal care home. The sign is still up there, but there is no personal care home in Oakbank. * (1 540) Also they promised to save the Winnipeg Jets. Well, the Winnipeg Jets have moved to Phoenix, another broken promise from the members opposite, and Manitobans will remember them. They will also remember the promises that were broken by the members opposite. In fact, the only promises that they did keep were to find jobs and contracts for their friends and corporate donators.

That is the case, and that is why it is impor tant for us to stand up today and to put these comments on the record. Madam Sp eaker, MTS was a publicly owned utility in this Crown corporation for over 80 years, and it served Manitobans well. It kept rates low regar dless of where you lived, whether you lived in the city of Winnipeg or in Dauphin, Selkirk or in a remote northern community. MTS at the direction of the government, and this was started with Pawley administra tion and carried on with the Filmon administration, they spent, I believe, $600 million, $700 million in capital.

They upgraded the rural network. They brought individual-line service to all of Manitobans. They expanded community calling zones.

13 74 LEGISLATIVE ASS EMBLY OF MANITOBA April 8, 19 98 MTS upgraded their network in rural Manitoba, provided them, as I said, with individual-line service because it was a public utility. It was done so because the government of the day decided that this was in the best interests of Manitobans, and it went ahead and the public utility did that. There are two other provinces besides Manitoba that have individual-line services in this country. That is the province of Alberta and the province of Saskatchewan.

The province of Saskatchewan still has a publicly owned telephone system, the province of Alberta no longer, but it was because they were publicly owned or are publicly owned utilities that they have individual-line service. MTS has employees in every region of this province. In fact between 19 90 and 19 95, the eastern region where Selkirk is a part of, in 19 90, there were 546 employees; in 19 95, there were 428, significant downsizing because of the members opposite. But the former minister of MTS, the member for Springfield (Mr.

Findlay) said well, we had to downsize, but that is it, we are not going to downsize anymore. There is no reason for a privately owned, privately operated Manitoba Telecom Services to lay off any further. He said so in a quote in the Selkir k Journal, where he says, and I quote : There is no stimulus I am aware of says they are automatically moved to Winnipeg, Findlay says. I do not see anything as far as the jobs in Brandon, Morden and Selkirk as far as a change in ownership. Well, he was wrong. He was wrong in this ar ticle, and he is wrong now.

We have seen lost jobs in Selkir k and Br andon and Morden, Dauphin, in the North. I urge members oppos ite to stand up today in this Chamber, Madam Sp eaker, as my colleagues on this side are doing, stand up today in this Chamber and stand up for rural Manitoban and for northern Manitoba. They represent communities, they represent consti tuents that have been laid off because of the change from a publicly owned to a privately run Telephone System, so I urge them to stand up today and to really look at what has gone on in the MTS since it was sold.

We have seen rates go up, and they promised that rates would not go up. They promised that jobs would not be lost, and jobs were lost. They promised that ownership of the privately owned MTS would stay within the province. They were wrong, wrong, wrong on all those promises that they put before the public and they put before this Chamber. What we have seen, Madam Speaker, and it has been rai sed in this House this past week that in order to pay for this million-dollar stock bonus that the Minis ter of Finance's brother and others have received is to raise rates and to lay off those Manitobans.

Tom Stefanson laid off Manitobans, he raised ra tes, and he is now rewarded by a million-dollar stock bonus. Something stinks, and it is a shame that members opposite are sitting in their seats today supporting this action. We know members opposite, I do not think they do support it by their response today and other days in Question Period, while they are letting their Minis

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Collection	Manitoba — Debates (Hansard)
Citation	36-4-28
Type	hansard
Volume / chapter	36th 4th hansardpdf 28.pdf
Language	en
Format	pdf
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