Committee Transcripts: Standing Committee on Finance and Economic Affairs - 2001-Feb-16 - Pre-Budget Consultations

Pre-Budget Consultations
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PRE-BUDGET CONSULTATIONS

CITY OF THUNDER BAY

TOWN OF FORT FRANCES

THUNDER BAY HOME BUILDERS' ASSOCIATION

LAKEHEAD ELEMENTARY TEACHERS OF ONTARIO

ONTARIO MINING ASSOCIATION

CONFEDERATION COLLEGE

THUNDER BAY TRANSPORTATION AND INDUSTRY COMMITTEE

KINNA-AWEYA LEGAL CLINIC STEERING COMMITTEE ON SOCIAL ASSISTANCE

NORTHWESTERN ONTARIO DEVELOPMENT NETWORK

THUNDER BAY CHAMBER OF COMMERCE

NORTHWESTERN ONTARIO ASSOCIATED CHAMBERS OF COMMERCE

THUNDER BAY COALITION AGAINST POVERTY

ANNE SCHEFFEE

CONTENTS

Friday 16 February 2001

Pre-budget consultations

City of Thunder Bay
Mr Ken Boshcoff
Mr Brian MacRae

Town of Fort Frances
Mr Glenn Witherspoon

Thunder Bay Home Builders' Association
Mr Ray Williamson

Lakehead Elementary Teachers of Ontario
Ms Christina Lofts
Ms Sharlene Smith
Mr Stuart McNabb

Ontario Mining Association
Mr Patrick Reid

Confederation College
Ms Pat Lang
Mr David Ramsey

Thunder Bay Transportation and Industry Committee
Mr Jim Pretchuk
Mr Hartley Multamaki

Kinna-aweya Legal Clinic; Steering Committee on Social Assistance
Ms Sarah Colquhoun

Northwestern Ontario Development Network
Mr Harold Wilson

Thunder Bay Chamber of Commerce
Mr Don Slobojan
Mr Harold Wilson
Mr Jim Pretchuk

Northwestern Ontario Associated Chambers of Commerce
Ms Tannis Drysdale
Mr Tony Beyak

Thunder Bay Coalition Against Poverty
Ms Chris Mather

Ms Anne Scheffee

STANDING COMMITTEE ON FINANCE AND ECONOMIC AFFAIRS

Chair / Président
Mr Marcel Beaubien (Lambton-Kent-Middlesex PC)

Vice-Chair / Vice-Président

Mr Doug Galt (Northumberland PC)

Mr Ted Arnott (Waterloo-Wellington PC)
Mr Marcel Beaubien (Lambton-Kent-Middlesex PC)
Mr David Christopherson (Hamilton West / -Ouest ND)
Mr Doug Galt (Northumberland PC)
Mr Monte Kwinter (York Centre / -Centre L)
Mrs Tina R. Molinari (Thornhill PC)
Mr Gerry Phillips (Scarborough-Agincourt L)
Mr David Young (Willowdale PC)

Substitutions / Membres remplaçants

Mr Steve Gilchrist (Scarborough East / -Est PC)
Mr John O'Toole (Durham PC)

Clerk / Greffière

Ms Susan Sourial

Staff / Personnel

Ms Elaine Campbell, research officer, Research and Information Services

The committee met at 0857 in the Prince Arthur Hotel, Thunder Bay.

PRE-BUDGET CONSULTATIONS

The Chair (Mr Marcel Beaubien): Good morning, everyone, and welcome to beautiful, sunny downtown Thunder Bay. You can't ask for a better morning than this, especially in the north. It's nice and cool.

The only announcement I have to make is, for all the members who have not checked out, we must check out by 11 o'clock. So make sure that you're out of there by 11.

CITY OF THUNDER BAY

The Chair: Our first presenter this morning is the mayor of the city of Thunder Bay. Your Worship, if you could step forward and state your name for the record, and on behalf of the committee, welcome. You have 30 minutes for your presentation this morning.

Mr Ken Boshcoff: Thank you very much, Mr Chairman. My name is Ken Boshcoff, mayor of the city of Thunder Bay. To my right is our city manager, Brian MacRae, and to my left is Carol Busch, our manager of finance.

First of all, I'd like to say welcome to our city. I know that many of you have been here before on several occasions; welcome back. We certainly appreciate you travelling to Thunder Bay to conduct these pre-budget consultations. This is a welcome opportunity to present the challenges and issues we face today and to comment on the fiscal and economic policies of the province.

My presentation will highlight the main topics covered in our detailed written submission. As you can see from the booklet, I would pretty much occupy most of the early morning should we decide to read it. But it's important to know that the details are in here, and we're very proud of the document and the research that was conducted for it.

The city of Thunder Bay has faced many challenges over the years; however, this year's challenges are extraordinary. Many of these challenges are related directly to global economic factors. However, some of course are specific to our city.

Two recent arbitration awards have significantly impacted the 2001 budget. Our firefighters were awarded a wage increase in excess of 13% for the period 1998-2000. This significantly exceeded the 6% negotiated by the majority of other city groups for the same three-year period. SEIU members employed at our homes for the aged received a 9% increase for the period June 1998 to June 2001. The combined estimated annual difference between the increased cost of these two awards and costs that would have been incurred had the awards been consistent with other city settlements is over $1.1 million per year.

Benefit costs are escalating as well. Health costs have been increasing at rates well above inflation. The increase in WSIB administration charges from 19% to 32% of the value of claims will result in additional costs of $400,000.

The consumer price index increased approximately 9% in the last five years. In addition, there have been significant increases in certain commodities, including fuel and natural gas. With fuel prices up approximately 27% over last year, the additional cost on an annual basis is approximately $565,000.

Over the last few years, many municipalities achieved balanced budgets by financing capital projects from reserve and reserve funds. Likewise in Thunder Bay, uncommitted capital reserve funds have been depleted to the point where opportunities that existed in the past to fund capital projects no longer exist to the same level as in previous years.

Our city has responded to the combined pressures of growing responsibilities and costs, scarce resources and public scrutiny by focusing on cutting costs and holding the line on tax increases. The municipal full service tax rate has increased only 1.2% since 1994. However, the city of Thunder Bay increased its capital out of revenue by approximately $1.7 million as a result of the 2001 capital budget review process. A number of factors have contributed to this increase, including an aging infrastructure that needs to be maintained or upgraded to provide core services, a lack of uncommitted reserve and reserve funds, and a lack of provincial subsidy dollars for capital projects.

Local service realignment has brought about fundamental changes to provincial and municipal roles and responsibilities. Northern Ontario municipalities are generally disadvantaged due to the following: northern Ontario municipalities cover large geographic areas, which significantly increases operating costs; we have more severe weather conditions than the remainder of the province, which translates into higher costs, including road maintenance and snow removal; we also have generally a lower assessment base.

Municipalities inherited many capital-intensive programs as a result of the LSR. Local government must now fund all road improvements and transit vehicle purchases.

The downloading of social services to our district social services administration boards will result in additional capital infrastructure to be maintained. We must state our fear regarding the devolution of social housing to the municipal tax base and concerns with respect to the potential liability associated with the housing stock and the financial impacts on our costs for social services in the event of a national economic downturn.

There are still outstanding issues to be resolved regarding items previously eligible for subsidy that are not eligible for the community reinvestment fund. In addition, we must have some assurance with respect to the level of funding on a timely basis, as delays in confirmation of funding levels are detrimental to good public service practices.

To further complicate the financial issues being experienced by the city, it is now facing a potential $5.5-million shortfall in revenue as a result of the recent provincial reassessment. We experienced a drop in our total assessment base of 4.9%, with total taxable and grantable assessment dropping to $5.8 billion from $6.1 billion, a decrease of $300 million. We have requested ministerial intervention to mitigate the impact of the latest reassessment and Bill 140's hard cap on levy increases in order to prevent the undue hardship that residential taxpayers will otherwise encounter: a projected increase of approximately 20% due to the shift in the overall tax burden on to the residential property class.

Under Bill 140, the Continued Protection for Property Taxpayers Act, 2000, there is a shift of responsibility from the Ontario Property Assessment Corp to lower- and single-tier municipalities. Municipalities must initiate a vacancy verification program, thereby placing further strain on the limited resources of tax departments.

There are several important issues not dealt with in the legislation, including: will new transition ratios be calculated to minimize inter-class shifts? What are the threshold tax ratios for the capped classes that will determine whether a hard cap applies in a given municipality? How will levy increases be determined?

We must emphasize the importance of receiving the Bill 140 regulations on a timely basis. A considerable amount of administrative time will be required to review and implement the requirements. If we must delay our final tax billing, there will be a considerable financial impact on the city of Thunder Bay.

At the same time we are dealing with emerging issues, we continue to deal with ongoing issues. There is a need for the province to commit to ongoing funding to help with the capital cost to improve our road and transportation system. From a provincial perspective, announcing new, major investment in our transportation and transit infrastructure demonstrates confidence in the province's economic future and signals that Ontario is serious about remaining open for business.

SuperBuild and the federal-provincial agreement on infrastructure are partial solutions. Municipalities have yet to be informed of how the proposed billion-dollar millennium fund will or will not assist in dealing with our road and transit deficit. While these federal and provincial programs help, and we are grateful for them, there is much more that needs to be done.

Our city covers a large geographic area and is responsible for maintaining approximately 950 kilometres of roads. The cost to maintain them to city standards is $5.22 million annually. Severe weather conditions contribute to higher road maintenance and snow removal costs, thereby exacerbating the financial issues. The city of Thunder Bay currently spends between $12 million and $14 million annually on transportation infrastructure, including roads, sidewalks and bridges, which is primarily funded from the property tax base. More than $20 million annually is needed to meet present and future demand and improve present levels of service.

With deferred maintenance and rehabilitation of our road, sidewalk and bridge infrastructure approaching $100 million, the ability to finance the required work poses a significant financial dilemma for the city of Thunder Bay. Likewise, the expanse of the service area, along with its long travel distances, the urban-rural nature of the city of Thunder Bay and the discontinuation of provincial grants, is making it increasingly difficult to provide cost-effective transit services.

The operation of a system of public transit is an essential social service. We must stress the need of infrastructure dollars to ensure cost-effective, efficient and safe public transportation. Canada is the only G7 country that does not provide infrastructure dollars for public transportation. It is important that all three levels of government work co-operatively to find a solution to the issue of public transportation.

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Legislative changes have also impacted on the cost of providing other municipal services. We are now fully responsible for paying for local policing costs. However, the province subsidizes policing costs in smaller municipalities and unincorporated areas through capping police costs at $90 per household. Capping of policing costs results in a significant inequity, as ratepayers in municipalities such as the city of Thunder Bay are paying the full cost of policing services through property taxes and contributing further, by way of provincial taxation, to the costs of maintaining the cap in other jurisdictions.

Even court security, costing $460,000 annually, is now our responsibility under the revisions to the Police Services Act. Furthermore, the cost of having to transport prisoners, especially young offenders, to facilities with available beds is now costing our city over $315,000 annually. We have also incurred significant costs as a result of the provincially mandated adequacy and effectiveness standards, including a quarter of a million dollars to meet equipment requirements; and we estimate the additional costs for the new training certifications to be over $370,000.

In July 1998, the Hotel Fire Safety Act was repealed and instilled in the Ontario fire code. Consequently, the responsibility for inspecting and enforcing the code in the city's 40 hotels and motels, as well as our four nursing homes, was downloaded to the city of Thunder Bay fire and rescue service. In addition to enforcement, the responsibility for education was also downloaded, with a total annual cost of $45,000.

Two of our homes for the aged are D-listed. Current legislation requires these homes to become compliant by 2006. To do so will cost approximately $10 million. There is an obvious need of infusion of capital funding by the province in order that capital costs are shared on an equitable basis.

With respect to the social housing issues, the senior level of government must continue to play a role. Through local services realignment, there is a larger municipal role. However, if needs are to be met globally, there must continue to be both funding and policy roles at both the provincial and federal levels.

The city of Thunder Bay has embraced the three Rs: reduce, reuse and recycle. However, today we are asking for latitude to do it in a fashion that would best suit our community. Regulation 101, which mandates how we recycle, focuses on the wrong R. Research of cases in Edmonton and in European countries found that diversion from landfill sites is far more effective than the blue box/curbside process that is currently in the province of Ontario. We strongly encourage the province to consider such an approach.

Our community is facing an immediate, critical situation in accessing physician services and in providing care to the people of northwestern Ontario. While the concern for recruitment and retention of physicians has been a concern for many years, it is now reaching crisis proportions. Training more physicians in northern Ontario is certainly the best response to this problem in the longer term. We are, however, in urgent need of support for immediate, short-term solutions that will allow our community to both retain current physicians and recruit new family doctors and specialists in seriously understaffed areas. As residents of Thunder Bay and northwestern Ontario, we urge you to respond to our community's and our region's critical and immediate needs. For us, this is truly a matter of life and death. The new Minister of Northern Development and Mines has been asked by the previous Minister of Northern Development and Mines to continue pressing the new Minister of Health to meet with representation from the city of Thunder Bay on this critical matter regarding physician and professional health care shortages.

We are anxious for the new Municipal Act to proceed. A new Municipal Act can set a valuable framework reassuring our common electorate that governments are working together and helping to renew respectful, good government. However, the city of Thunder Bay has some specific areas of concern with respect to the proposed new Municipal Act.

One proposed limitation is the restriction on a municipality's ability to create or hold shares in a corporation unless specifically authorized. This restriction certainly may limit the range of options open to municipalities for the joint provision of services under private-public or public-public partnerships. Section 265 provides a very onerous process of disclosing licence fees and the method of calculation, which is closely tied to the annual budget process. Section 266 is similar in that it ties the establishment of fees and charges to the annual budget process and requires a bylaw establishing such fees and explanations as to how the fees were established. These sections would result in a bureaucratic nightmare and would be very restrictive to every operation within the city.

Flexibility of the municipality to adjust as required is eliminated, and the city's ability to conduct operations in a responsive, businesslike manner is substantially impaired. In addition, the new Municipal Act does not appear to provide sufficient corporate capacity to allow Thunder Bay Telephone to provide telecommunications services as defined by the federal Telecommunications Act, thereby limiting our ability to provide services as would reasonably be expected from a telecommunications common carrier.

Municipally owned telephone systems should have the opportunity of entering and exiting existing and new lines of business. Our telephone company has long recognized the valued role that public and private sector partnerships play in the successful deployment of services to residents of northwestern Ontario. It is imperative that the proposed new Municipal Act allows municipally owned telephone systems to own shares.

The proposed act restricts the ability of municipally owned telecommunications common carriers to fulfill their federal mandate. We are concerned that the proposed legislation will further impair the ability of the residents of northwestern Ontario to access the telecommunications services required in today's knowledge-based economy and contribute to a further erosion of the region's quality of life.

In this new millennium, local telephone companies are faced with more challenges than ever before. With the advent of local competition and the potential erosion of traditional sources of revenue, it is imperative that locally owned telecommunications common carriers be given equal legislative rights to pursue new business opportunities.

We are supportive of the following issues that will be raised by Development Thunder Bay, including encouraging the government to provide adequate funds to the Ministry of Northern Development and Mines to carry out its economic development function; increasing funding to our educational institutions, our regional hospital, the Northern Ontario Rural Medical School and the Northwestern Ontario Development Network. We support reactivation of the heritage fund, especially the inclusion of infrastructure access to destination tourism as a funding component; and designing an investment mechanism for venture capital for uses in northern Ontario communities.

There is a definite need to be able to expand the revenue sources available to municipalities. In that regard, we suggest amending the Public Utilities Act to permit sanitary system or drainage system utilities, thereby facilitating movement to a full user-pay structure. User fees should be set so that those who consume public services pay for them. Easing the tax burden on lower-income individuals is more equitably and efficiently handled through income transfers from the provincial government or through local social assistance programs targeted to specific groups, rather than through setting user fees at a level below the cost of the service.

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There are solid economic arguments for the implementation of provincial legislation permitting municipalities to levy new taxes as a supplement to property taxes. A municipal fuel tax, piggybacked on to the provincial fuel tax, makes economic and political sense, especially in areas with considerable road and bridge infrastructure needs.

While the city of Thunder Bay strongly supports the concept of performance measurement and best-practice emulation to the extent that we are voluntarily participating in ICMA and the CAO's benchmarking initiative, we do have reservations about the approach that the province is taking. Performance measurement is a long-term, results-oriented management tool to be used to highlight success and identify areas for improvement. Because of the unclear definition of costs and the lack of a common methodology for cost allocation, the results achieved are not comparable. Consequently, there is a risk that the report card will be used in a punitive manner. We urge the province to take a leadership role in educating the public and politicians about the uses and limitations of comparative performance measures.

Considering the significant progress that has been made by the municipal CAO's benchmarking initiative, it may be prudent of the province to consider partnering with that group to refine the data collection process and resolve cost allocation issues to achieve a true apples-to-apples comparison.

Members of the standing committee, the city of Thunder Bay is committed to providing high value municipal services through forward-thinking policies and effective management. To do this, we also count on the province of Ontario for support and effective policy-making. We greatly appreciate that the standing committee's report to the House will include an understanding of the north. Thank you very much.

The Chair: Thank you very much, Your Worship. We have approximately two minutes per caucus, and I'll start with Mr Christopherson.

Mr David Christopherson (Hamilton West): Thank you, Mayor. I appreciate your presentation. I was drawn to page 14, where you talked about the fact that "easing the tax burden on lower-income individuals is more equitably and efficiently handled through income transfers from the provincial government, or through local social assistance." I just wanted to bring to your attention that we had an economist in a couple of days ago who pointed out that one of the things that makes Canada and Ontario work is the income redistribution that we have. Because there is such a growing gap between the very wealthy and the very poor-the gap is one of the greatest in the developed world. If you take just the gross income of the top 20% versus the lowest 20% income earners, it's a 27:1 ratio. By the time you finish doing the transfers, the public services that we provide, our progressive income tax system, at the end of the day, you end up with a ratio at 4:1, which starts to even things out a little bit, and that's why overall there is a better standard of living.

Is it your clear understanding that if things follow through the way they are, and you don't get relief in the areas you've outlined here today, you're going to have to implement more and more user fees in order to offset your costs and thereby at the end of the day, if every municipality had to do that, it would probably leave us with a different ratio and therefore a whole different quality of life across the province?

Mr Boshcoff: I think a couple of us will answer that. From the political standpoint, certainly the pressure is on for municipalities, and for us to try to find revenue sources becomes more and more difficult, which leads us down only a certain number of paths that we have open to us, unless we get some measure of support from the senior levels. That's really where we're coming from philosophically. We would probably not have to implement so many things if the pressure was off, but the pressure is on, and it's on severely. So we have to look at ways of doing this, which leads us to the inevitability of user fees.

Mr Brian MacRae: I think the other aspect here is that we are looking and need to continue to look for non-tax revenue sources, which translates into our need to establish a broader range of user fees for a number of the services that we provide. We are suggesting that we don't want to be constrained from putting an appropriate user fee in place because there isn't enough focus on income redistribution at the more senior levels of government.

Mr Christopherson: Right. Thank you.

The Chair: The government side.

Mrs Tina R. Molinari (Thornhill): Thank you very much for your presentation. I have just a couple of questions. One, I was interested to hear the results of the recent arbitrations that you had with the firefighters. Before this government was elected, the arbitrations were decided upon a number of specifics that they had, and this government introduced a number of regulations. One had to do with the ability to pay for those who were paying for the settlements and also comparison factors with others within the field. It surprises me to hear that an arbitration was settled in such a vast-so if you could just comment a bit on that.

Mr Boshcoff: I'll tell you now that the Association of Municipalities of Ontario, Northwestern Ontario Municipal Association-just about every municipal organization-has been sending resolutions in fairly strong terms to the government as a result of several of these arbitrations that have occurred across the province, because in almost every case the argument about ability to pay has been ignored by the arbitrator. Our concern is that these are very heavy. The provincial government sets out a standard saying this is where you should be; municipalities similar to ours try to bargain along those lines, it goes to arbitration and the costs inevitably are higher.

The Chair: Thank you very much. Mr Kwinter.

Mr Monte Kwinter (York Centre): Thanks for your presentation. You said you were very proud of it, and you have every right to be. It's very comprehensive.

I have a concern and it sort of runs throughout your presentation. You keep talking about user fees, municipal fuel taxes, and each of these, whether it be called a user fee or a tax, is a tax. The same person is paying it. As a politician, do you feel comfortable with doing that? Do you feel that this is something people will accept?

Mr Boshcoff: No, I don't feel comfortable about it, Mr Kwinter, but we-and I say "we" as I'm also on the board of the Association of Municipalities of Ontario-as municipal representatives, are against the wall. Our reserves have been essentially used up. We've gone through many years of cost-cutting and trying to hold the line on taxes so that what we are left with now are very few tools to try and sustain municipal finances.

It is one thing to have special funds come along-those are great, don't get me wrong-but to me it would be a lot better to have a predictable, stable level of funding that came out well in advance of when municipalities prepare their budgets. The bottom line is-am I comfortable with it?-I certainly am not, and I wish we didn't have to go that way. The entire gist of our presentation today is that if we are going to have a new Municipal Act with new responsibilities, then it would have to have a greater understanding of the role of the province in funding major infrastructure for municipalities and stabilizing that funding so that we know it's coming, we can plan for it and we know when the tax bills can be sent out, which is also a costing for us.

The Chair: On behalf of the committee, thank you very much for your presentation this morning.

Mr Boshcoff: Thank you.

TOWN OF FORT FRANCES

The Chair: Our next presenter is the mayor for the town of Fort Frances. Your Worship, if you could come forward and state your name for the record, please. On behalf of the committee, welcome, and you have 30 minutes for your presentation this morning.

Mr Glenn Witherspoon: Good morning, and I too welcome members of the finance and economic committee to northwestern Ontario. I understand that the Chair might have had a little fortune at the casino last night? A little birdie told me. I too had some fortune, so it's great.

Mr Christopherson: Did you win last night?

Mr Witherspoon: Didn't he tell you that?

Mr Christopherson: No.

Mr Witherspoon: What a guy.

Mrs Molinari: It's on the record.

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Mr Witherspoon: Today I speak to you on three different subjects, and I repeat some of the sentiment the former speaker, the mayor of Thunder Bay, spoke about regarding the impact of Bill 140 and the new reassessment on smaller municipalities. I'll also speak to you on directing exported northern dollars into local small businesses and the future of our district jail. I bring the last subject up because I take every opportunity to speak to various levels of government, in attempting to get decision-makers to Fort Frances, about the future of our jail because it has a big economic impact, especially where we are located.

First of all, Bill 140 restricts the property tax increase on commercial, industrial and multi-residential properties if a municipality's tax rate is above the provincial average, as is the case in Fort Frances and in 85% of municipalities throughout the province. Any tax increase needed to continue the standard of service must then go to residential properties. Fort Frances and the Rainy River district probably have an average age older than the majority of municipalities in all Ontario, and additional burdens on residential property taxes will be very detrimental.

I agree this is a fair bill when one thinks about Ontario's competitive challenge in the world today, and I applaud the government for doing this. However, the end result of reassessment and the moving of such huge dollar figures in one year has left small municipalities with a balancing nightmare. Such is the case in Fort Frances. Over $400,000 was removed from the industrial tax base and now must be put on the backs of residential taxpayers. We basically have our paper mill, Abitibi-Consolidated, which contributes about $3 million a year to our taxes. We raise $11 million to $12 million in taxes municipally. Moving $400,000 of that, plus constraining any increases we will have on commercial, multi-residential and industrial, makes it very difficult.

The province must provide a fund over and above the community reinvestment fund. Creation of a short-term, special-circumstances fund is required until a more equitable plan can be established locally. I re-emphasize that we did have a special-circumstances fund in place two years ago, and it was discontinued.

I found out about Bill 140 while attending the Rainy River District Municipal Association annual meeting. Our member, Howard Hampton, presented us with a document in regard to Bill 140. I emphasize that Bill 140 is needed to be competitive, but prior knowledge, probably a little bit of input and the tools to make it work are needed. I'll re-emphasize that.

The 10-5-5 taxation regulation over the past three years has worked in most cases. The impact on municipalities is such that we need help in order to maintain a zero per cent tax increase while continuing to maintain a service which the citizens of our province truly deserve.

I take pride in saying I'm in my 10th year as mayor of Fort Frances. We've had one tax increase, that being to pay for a debenture for a new sportsplex, a new theatre and a secondary treatment plant. Other than that, we have been able to maintain a zero tax increase. But with these changes coming, I have to emphasize again, we need help. It doesn't have to be continuous. CRF needs to be continuous because of the transfer of services, which again we take open-heartedly because we've always wanted to take a crack at social services and whatnot, and it's working well. But in this case we do need help.

The second part of my presentation: I've been dealing with our Rainy River Future Development Corp, which does the economic development for the Rainy River district. They are hired under contract by the town of Fort Frances. We find it is very difficult for capital ventures and whatnot to get local money for our small business. Currently all money that is invested by area residents through their annual purchase of RRSPs is invested in mutual funds, money markets or stocks. For Fort Frances and the Rainy River district alone, this amounted to approximately $11 million in 1991, with significantly more being invested by the year 2001.

Currently only three district businesses are listed on the stock exchange, other than mining companies. These are Abitibi-Consolidated Inc, Normiska Corp, and Voyageur Panel through Boise Cascade Corp. This is only a small percentage of local monies that, if actually invested through RRSPs in the region-the north is exporting its investment dollars, like our youth, to southern Ontario, Canada and abroad.

Two other examples of local dollars going south to benefit urban Ontario and the rest of Canada would be the Ontario municipal employees' pension plan and the Ontario teachers' union pension fund, one of the biggest in the world, which invest northern Ontario investment dollars elsewhere in Ontario and Canada.

In order to stimulate development across the north, Ontario must work with Canada to develop a mechanism which will allow northern residents to invest in northern businesses and obtain RRSP tax credits. One example is the labour-sponsored investment funds, such as the Crocus fund in Manitoba. These funds have been able to redirect significant RRSP dollars into local businesses. This example has been so successful that it has grown over $200 million since its inception in the late 1980s. Investors obtain both an RRSP credit and an additional provincial tax credit, which increases their RRSP refund. This upfront return on investment makes such funds very attractive as part of a portfolio, and investors will lock in their money for up to eight years in order to gain a benefit.

Unfortunately Ontario's fund, the Working Ventures fund, does not appear to invest in northern companies. To the best of my knowledge, the only company in which it has invested is in North Bay. With its great rate of return-7% as of last week's National Post, as compared to the Crocus fund's rate of return of 0.5%-the fund may be working well, but it is not working for northern Ontario. We need our own vehicle for investing in northern companies, big and small.

Another mechanism which I believe is essential for northern Ontario's future is the creation of the ability for our entrepreneurs to roll over a portion of their RRSP funds into a small business. If this were possible, it would give potential entrepreneurs the opportunity to use their own money to invest in themselves. Currently an entrepreneur must cash an RRSP and pay whatever taxes are applicable prior to being able to use the money in a business. He or she must finance the difference between the RRSP before and after taxes in order to do the project. This places an undue financial burden on the new venture which would not be there if the total RRSP amount could be used. These funds would be tracked by Revenue Canada, as the entrepreneur would always owe a minimum tax to Canada. I believe this would be an inexpensive way for Canada to generate business and create jobs, especially when we compare it to having the system allocate monies to business, eg, Canada jobs fund of late.

I am seeking the assistance of Ontario in forwarding such initiatives in order to create a strong northern Ontario economy.

The third subject I'd like to talk to you about today is the closure of the Fort Frances Jail, which was announced in May 2000 by then-Minister Sampson. We've had various meetings at the municipal level, and I've talked to Deb Reid in the minister's office several times. The minister was scheduled to come to Fort Frances, and then he had to resign his post. We have a new minister in Norm Sterling, and we look forward to his visit to Fort Frances and area to see the infrastructure that is there.

I present to you today some letters from the lawyers' association of Fort Frances and the Rainy River district, also from the people who work at the jail, as to the importance of the jobs and the economy it will create. We have 23 people who work in the jail, with a budget of about $1.5 million. This is going to be very important when it comes to the new budget, but the province has said they will save approximately $300,000 or $400,000.

0940

If you read the documentation that is presented to you in the plan we have, we need to work together. I've talked to the mayor of Pembroke and they are attempting to put a package together, but if you consider that the province will pay $1.1 million to transport prisoners and then they'll have the same expenses at the other end with regard to clothing and housing them and the extra security that will be needed, I feel that indeed it's not a financially prudent decision. All I'm asking today is that you take the message back, especially the people of the government, to the new minister and to the cabinet people who are going to be putting the budget forward that we request a meeting in Fort Frances. It is the gateway to northwestern Ontario.

I have a letter here that states what some of these conditions will mean, especially to tourism. Carrying a .45 in an RV is daily life for an American. So if he comes to the border and is asked, "Do you have any firearms or whatnot?" the majority of them say no, because they just carry them. It's a way of life. If they do an inspection, and the guy could be a brain surgeon from Chicago, a pretty high-profile person, and they say, "Well, we've got to arrest you because you didn't declare your gun, but, I'm sorry, you're going to have to go 300 kilometres or 420 kilometres to a jail in Thunder Bay"-where there are over a million people a year using our crossing, it's imperative that we maintain the system we have. If you say to this doctor, "We'll have to take you to Kenora to lock you up. You can't have a hearing until Monday or Tuesday," they're never going to come back. These people are not all criminals.

All I'm saying is that if they close a jail in southern or northeastern Ontario, with a proximity of 50 kilometres or 60 kilometres from one jail to another, that is not very significant. It is very significant-the district of Rainy River deserves a jail. I can't emphasize it enough. For example, yesterday the Prime Minister said to a group of students in China, "The economy is based on a strong judicial system." The same position stands in Fort Frances. Judicial services include local jail services. Fort Frances has had local jail services for approximately 100 years. The Prime Minister says that the judicial system is needed, and we're depleting our infrastructure by moving this.

We will be a partner. We will invest money; the private sector will invest money. We just need the government to come and see what we have, and we can work as a team. We know our jail is antiquated. We know we need a new one. We're willing to house a youth detention centre; we're willing to house a women's jail. We're willing to work together and be a partner, but we need help and we need it now, before 2004 comes around.

That's my presentation, sir.

The Chair: Thank you, Your Worship. We have approximately three minutes per caucus, and I'll start with the government side.

Mr Steve Gilchrist (Scarborough East): Thank you, Your Worship. We appreciate your coming forward.

I'm impressed with the proposal of the RRSP for the north. Let me ask you, as a corollary to that: given that 10% of the population of Ontario is Sudbury to the Manitoba border, should there be a regulation compelling the existing municipal and provincial public sector unions to invest 10% of their resources in some way into the north? They got the money there. Would you agree it's only fair to-

Mr Witherspoon: I'd agree with that, and it would probably be a first step.

Mr Gilchrist: It would be an impressive first step. The teachers' union alone would be investing $6 billion in the north instead of in office buildings in downtown Toronto.

Mr Witherspoon: That's correct.

Mr Gilchrist: So I appreciate that suggestion. That's the value of these hearings, getting good ideas like this that we might otherwise not have seen.

Mr Witherspoon: We don't want to go all the time to Queen's Park with our hand out. This would just eliminate one hand.

Mr Gilchrist: I appreciate that. That's the sort of suggestion we particularly like.

The other question comes back to something Mayor Boshcoff raised as well, and that's the issue of Bill 140. My apologies that I didn't bring the detailed mill rates for your municipality.

Mr Witherspoon: I have them here.

Mr Gilchrist: Are you above the provincial average in the other category?

Mr Witherspoon: Yes, we are.

Mr Gilchrist: Are there specific reasons why that transpired over the years?

Mr Witherspoon: I've been involved for 15 years municipally, and in that period of time we've really held the line, but in the 1960s and the 1970s it was willy-nilly, and probably commercial and industrial were the least resistant. They didn't have as many eyes or as many mouths to bitch at the politicians, so that was easy prey. This is why we're in the state we're in today.

Mr Gilchrist: As a last point on this question, you talk about a transition period and the need to manage your way through this. I do have your total assessment base; it's about $375 million. Clearly, while there is a shift, $400,000 divided over that base isn't all that big. What sort of time frame-

Mr Witherspoon: For taxation purposes it represented, actually, a 4% increase, but what we did was reduce another $200,000 out of the operating and took the additional 2%. For this year alone we said we had to raise our taxes 2%, but now, with Bill 140, in the second billing the 2% will come off the industrial and commercial and have to be put on to residential.

Mr Gilchrist: What will that translate to?

Mr Witherspoon: Probably another 2% will be another $50 to $80 per household.

Mr Kwinter: Thank you very much for your presentation. I have some concerns about your proposal on the RRSPs. The whole thrust behind an RRSP is to provide a vehicle where people can invest tax-free dollars for their retirement. The fund managers who manage these funds try-you wouldn't know it by the stock market today and what's been happening lately-to get a reasonable return and as secure a return as they can for their investors. Capital goes where it can get that return, where it can get it at the least risk and the greatest return. Capital has no allegiance; it has no love; it goes where it can go.

My concern is that if you tie an RRSP to investment in the north, you set up the situation where investment is made not because it makes any particular sense but because emotionally you want to put the money into the north. If a decision is made by some multi-conglomerate that they have to rationalize and they shut down a mill, they say arbitrarily, "We're shutting the mill in Rainy River," but it had nothing to do really with the specifics of that particular company. You hear it all the time, where a company closes a plant, the workers say, "We are one of the most efficient plants you've got," and they say, "Don't confuse us with the facts. We have our corporate strategy in shutting down." Suddenly, all of these people who are depending on a return for their investment are left without it.

I think there's a role for government to play. This is where you spread the risk over everybody and, as a matter of public policy, you set up a development fund for the north. But it isn't tied to individual residents of the north who have to literally gamble their future on what happens there. They should be able to mitigate the risk and have a relatively safe investment.

You really have to think that through, because there are some very serious potential repercussions of trying to promote that kind of thing, where people say, "I know I can get a better return somewhere else, but I have a responsibility to the north and I'm going to invest my money there whether I lose it or not." I think that's a role the government should take; I don't think it's a role the individual should take. I'd like to hear your comments on that.

Mr Witherspoon: As you know, most of the industry in the north would be natural-resources-based. We've just recently hired Paragon consultants out of California to do economic feasibility, and the natural-resources-based industries look a lot stronger than the techs in southern Ontario today, if we watch the stock market.

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We do have some good companies in the north that require capital funding. It would behoove the government to work with the federal government to create a body that would disburse a fund to invest in the north which could be RRSP-compatible. That would be great. That's my report to you.

The Chair: Thank you very much.

Mr Christopherson: Thank you, Mayor, for your presentation. It's unfortunate he's not here-I don't want to talk behind his back-but I'm sure he'll return in a moment after doing his clip. It's interesting that for the government member suddenly, when you talk about $400,000, it's not so much money as long as it's your budget that it's coming out of as opposed to his. What crossed my mind when you said that the 2% could turn into $50 or $80 a year-I spent time on municipal councils, so I understand the relationship between municipal and provincial. It's got to be infuriating-I know it is in my community of Hamilton-to have the government make as their main gift, if you will, as they see it, to the people of Ontario all of these tax cuts, but at the end of the day they're causing increases elsewhere. Everybody else is having to raise their rates and they're taking the heat. The mayor who was here before you spoke of user fees that are having to go up and how that has a detrimental effect on the lowest-income members of your community.

Anyway, I'll leave that with you. If you want to comment on that, I'd appreciate hearing it. But I do find it frustrating, on behalf of municipalities and other transfer agencies, that the government stands there and says, "We cut taxes; we cut taxes." You know, cutting budgets is easy, really, if you don't want to think about it. You just take your red pen and start stroking and there you go, you've cut the budget. But at the municipal level of government, where you're actually there to provide the services on the ground, you either cut those services or you have to increase. I'll leave that with you.

Also, on the issue of the Fort Frances Jail, I've been there.

Mr Witherspoon: In the jail itself?

Mr Christopherson: Yes, although I was able to come and go as I wanted, but I was there.

Mr Witherspoon: Saturday night.

Mr Christopherson: No, actually as the minister at the time. It's a real dilemma, but one of the reasons we backed off from a lot of the closures was because of the economic impact. It made sense, corporately, for us to do a lot of the things this government is looking at. Those plans were in front of me too. So it looked good for us and it would have made my ministry budget look good and therefore would have helped the government, but there was a really negative impact, particularly the farther you went out from Toronto. The farther you went out, the greater the impact, whether you went east, west or to the north.

These jails are older and they require investment, and I know it's difficult, but I would suggest, and I wouldn't mind your comments, that the government has an obligation to recognize the impact on the local economy. Your financial responsibilities don't end at your own budget when you're a senior level of government like the province. You've got an obligation to make sure you're putting in place measures and doing things that support local economies in the community, because at the end of the day the province is merely a collection of all our municipal communities. So some of your thoughts on that would be appreciated.

Mr Witherspoon: We'll go to your first question first in regard to tax implications on the $400,000. I believe that the municipal level of government is the most important level of all three governments when it comes to the individual people they serve. They can see us, they can touch us and they can bitch at us every single day. The implication of the $400,000 is very significant. Like I mentioned in my presentation, we need a tool to get us through this. We take pride in developing the service that people have, and taking $400,000 out of our operating or future capital purchases is devastating.

In regard to the jail in Fort Frances and the impact economically, one of your two words here is "economics," your committee that's looking at economics for the future. It's very important that we maintain this infrastructure part. We have a beautiful courthouse, we have a beautiful civic centre and we now have infrastructure for recreation, for culture. I challenge any community our size to go against our infrastructure, but we also need the social part of it-we are right on the border-in tourism, and the government of the day is promoting tourism. We have a million people come and we just can't take that aspect of it out of where we are. The weather is severe here. It could be blowing and we might have to transport 10 people today who are a little less than reputable, and if we have an accident and they're out on the road-we need the jail and we need it in Fort Frances, especially on the border. I just can't emphasize that enough.

The Chair: Your Worship, on behalf of the committee, thank you very much for your presentation this morning.

Mr Witherspoon: Thank you. Enjoy your stay in Thunder Bay. You can always bring this to Fort Frances.

The Chair: We were in Kenora last year, a little closer.

THUNDER BAY HOME BUILDERS' ASSOCIATION

The Chair: Our next presenter, the representative from the Thunder Bay Home Builders' Association, just came into the room. I will ask the gentleman to come forward when he's ready and to state his name for the record. On behalf of the committee, welcome. You have 30 minutes for your presentation this morning.

Mr Ray Williamson: If they hadn't told me you guys were going to be buying houses, I wouldn't be rushing so fast. I don't do this for a living.

Thank you, Mr Chairman. My name is Ray Williamson. I'm President of the Thunder Bay Home Builders' Association. I've been building homes and have been exposed to home building in this city all my life. I specialize in a whole pile of different areas. We're into the high-tech area of telecommunications. We also do revitalization programs on the development of communities. So we build more than just homes. Basically, I'm a volunteer, along with 3,500 other volunteers, for the province of Ontario in the home building industry through OHBA, the Ontario Home Builders' Association. I really appreciate the opportunity to speak to you today. I'll make my report very brief, which is almost impossible, because once I get going it's pretty hard to stop. Like I said before, the Ontario Home Builders' Association represents 3,500 members and they probably contribute toward the neighbourhood of 180,000 jobs in Ontario.

Here are some of the areas I'd like to get into. The major highlights of 2000 include: start-ups were up across the province, with some areas showing significant gains. Some of the larger increases were found in Kitchener, Ottawa-Hull, Oshawa and Toronto. However, there were few communities that experienced decreases in starts. Here in Thunder Bay we were down about 34%. In Sudbury they dropped about 13%. So much of Ontario is booming, and we in the north continue to struggle with a sluggish housing market. Multiple-family construction was up about 9.4% in 2000, compared with the previous year, and single, detached starts increased by 4.2%. However, rental housing construction is still stagnated, despite Ontario's robust economy and incentives brought forth by the provincial government.

One of the contributors to a healthy new housing market in Ontario can be attributed to the success of the land transfer tax rebate program for first-time homebuyers of newly built homes. Since this measure was first introduced in 1996, about $106 million in rebates was given to over 78,000 Ontarians, which assisted them in the purchase of their new homes. This, in return, contributed to the growth in the new housing market. We congratulate the government on making the rebate program permanent in last year's budget and helping to ensure that housing remains affordable for first-time homebuyers.

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Every year, the Ontario Home Builders' Association conducts economic forecast surveys with our members. The November results of that are included as an appendix to our submission, which I think everybody has. Nine of the 10 members surveyed expect sales to increase or remain the same in 2001 compared to the previous year. The optimism is reflected in OHB's forecast for 2001. We expect 70,000 starts this year, which represents the fourth straight year of growth. We need some of that here. In Thunder Bay we have a really good council, we have a lot of people with vision and we're struggling to get our economic growth stable. We're struggling to achieve that especially in the housing market.

With industry cutting back-and we've become so dependent on industry. The infrastructure of a town like this is dependent on mines, the mills and elevators. When they start cutting back at Bowater from a 3,000-person workforce to about 800, and then you have the elevators, from around 3,200-I'm not sure of the exact numbers, but around 3,000-to about 400, where do you find jobs that pay that kind of money? What happens is that the market starts to slow down quite a bit because you don't have the jobs that pay that kind of money to stimulate it. Our council has the vision to try to stimulate and get industry back into the community. Because we're centrally located, I think that's going to help out a lot.

Renovation spending continues on a upward trend even in Thunder Bay. About $10.5 billion was spent in this sector last year in the province. We predict renovation spending will climb to about $11.5 billion in 2001.

Ontario's economic performance has been impressive over the past year. Low mortgage rates and strong job creation fuelled consumer confidence and encouraged the new homebuyer to buy in this market. While generally optimistic, enthusiasm for the coming year is tempered with concerns over labour shortages and rising costs of material and skilled labour. These increased costs, combined with new taxes, fees and charges, could hinder future growth. More than 60% of our members cite increased labour costs as an impediment to growth for 2001. Almost as many as 58% are experiencing difficulty finding skilled labour.

That brings me to another issue on skilled labour and the educational system. I dropped off a report where you can see that basically the provincial government has been entrusted with the stewardship of educating our kids. We can't forget the fact that skilled labour is our bloodline. If we don't have people coming into the industry in carpentry, plumbing, heating, whatever-the average age of an apprentice is 27, and the average age of a bricklayer is 55. We're not doing enough to get those kids interested in the programming early enough. We used to be in there in grades 7 and 8. Those programs were cut.

There are further hindrances in our sector with the Ministry of Labour not allowing kids under the age 16 on a work site, even under controlled supervision. If you go in like it was before, where you could bring in children when they're making their initial-at 14 they get introduced into the high school system. That's when they start making career choices, and that's when you have to get them. We can't all be behind a computer or behind a desk. Our industry's strength is also through the bloodlines of skills and labour. We have to do something that's going to perpetuate that into the 21st century so that we're strong. No matter what else we do, our kids are our future. In Thunder Bay right now, we're not experiencing a booming housing market, and we had a shortage of skilled labour about three months ago because one of the mines pulled most of the guys out of it. Again, when we get into the labour aspect we have to do something that's going to continue to develop that in the educational system.

Thunder Bay Home Builders' Association is fully supportive of the Ontario Home Builders' Association recommendations that are intended to make sure the residential housing and renovation market remains strong in Ontario.

Development charges: we've been very fortunate with our mayor and council and the staff. We haven't been subjected to development charges, and I think that is a hindrance in most situations. We need it, but we always have to maintain control over it. In some situations in Thunder Bay we've been fortunate enough that councils didn't implement it, and that could be set as a role model. How they are able to get funds from other areas to supplement that should maybe be taken in other communities. With the Development Charges Act, people are having a tough enough time buying a house. We've got to remember the Canadian dream is home ownership. Throughout the world, people don't have the luxury of having homes, and we're very fortunate to do that. If we don't have controls like some of the communities I've been involved with-I actually chair all of Ontario for health and safety and I'm on the board of directors for CSAO, so I go down east quite a bit and I see what's happening to the industries in Barrie and places like that where the government hasn't stepped in and said, "You can't do it." They let them go wild with some of these development charge acts. What it's going to do is, you've got a perpetual motion right now of people buying, but once it stops it's going to stifle it and you're going to go back into a recessionary period. We don't need that. The time to re-evaluate that and implement controls is now.

I wrote all this stuff, but I just got back from Toronto myself. I had other stuff and I'm trying to get myself together here.

Another area that is very important: You can implement all the policies you want-and I don't have to read this for this stuff; the underground economy. If you don't have anything in place to enforce what you set out, don't bother implementing it because it just makes so much paperwork; it doesn't matter whether it's through WSIB or through Revenue Canada. If you implement policies you have to have an enforcement team that can deliver, that can go out there and make people follow what you've implemented, because it doesn't do you any good. What happens is, it's a two-tier system. The people who comply are being penalized because they're competing against people who don't have to comply.

We're very fortunate. I find the people who are in place now have the willingness to listen. It's all about working together. You guys wouldn't be here if you didn't want to learn from people. It's really good that you're here, and I really appreciate that too.

Rental housing: we look at 3.8% as about average. Anything above that is a buyer's market; anything below that is a landlord's market. Right now we're at 5.8%. In the rental housing market, housing is in short supply in a growing number of urban areas across the province. Nine regions have a vacancy rate under 2%, and five cities, including Toronto, Barrie, Kitchener and Guelph, have a vacancy rate under 1%. Thunder Bay is 5.8%. Still, that has dropped from a rate of 7.5% in the year before. Despite Ontario's robust economy, the reality is that there are very few new housing starts. The provincial government has undertaken a number of initiatives in the past to encourage construction of rental accommodation, including most recently the PST grant program, which is pretty good.

The Ontario Home Builders' recommends that the government renew the PST grant program and increase funding for this program initiative to support new affordable home construction. A review program is critical and is recommended so that the grant targets the intended sector. In addition, OHBA urges the provincial government to review the recommendations from the housing supply working group and seek to eliminate the disincentives that currently discourage the private sector from building rental accommodations.

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Many municipalities across Ontario have undergone or will undergo amalgamation. While over 80% of OHBA members support the concept of amalgamating communities, they do have concerns about increased costs and delays that are being incurred by builders as these municipalities merge. Therefore, OHBA urges the provincial government to expedite the supply of necessary funding to renew amalgamated municipalities to ensure a quick, effective merger of building and planning departments and rewrite zoning and bylaws.

Again, in Thunder Bay we have a building department that is very receptive to the growth of our industry. They have a willingness to communicate. Communication is a key factor in anything. If you lose the communication skills, you might as well not get up the next day to go to work, because you have to communicate.

Let me conclude by noting that this government has cut taxes 99 times since being elected in 1995, and in last year's budget announced a further 67 cuts over the next five years. We urge the government to continue on this path that has proven to be very successful for Ontario. Let me also repeat that OHBA and its members strongly support the fiscal policy of the provincial government and encourage the government to continue in the direction of cuts in spending and taxes.

If you want to open up the floor, I can probably answer questions.

The Chair: Thank you very much. We have approximately four minutes per caucus, and I'll start with Mr Kwinter.

Mr Kwinter: Thank you very much for your presentation. I'm sure you know we've already heard from the Ontario Home Builders' Association and the Toronto Home Builders' Association, so we've heard the general concerns and the specific concerns of your industry.

I'd like to talk to you about Thunder Bay in particular. I was quite surprised to hear that home construction in Thunder Bay is down 34%. Is that just a one-year phenomenon or has that been going on for some time?

Mr Williamson: It's the worst it has been-it's actually been on a decline for the last few years, and we need something to kick-start it. I think industry's going to do that. We have to try to get some sort of industry in the high-tech programs, either computer manufacturing or something-because we're centrally located, call centres are a good idea. Actually, when you look at a call centre, it doesn't pay enough money to draw from, but it's still moving in the right direction. You need call centres, but you need other things that can supply higher wages so people can afford the luxuries of owning homes and even paying the rents that are already established. We're running about $650 a month on an average for rental costs. So what we have to do is, I think, create consumer confidence and the introduction of industry into this community.

We are centrally located. Even for shipping or the exporting of product, we have a beautiful harbour and we have the exporting facilities to get it all over the world from here. If you're in Halifax and you manufacture something and you have to ship it to BC, the costs are huge. But in Ontario you can manufacture and go to both coasts and you cut your costs in half.

It's just like call centres. If you're a call centre-this is my perception and it could be wrong-and you're in the centre and you phone to BC or you phone to Halifax, your rates are half those than if you were in Halifax phoning to BC. So actually we're in a super location and a very competitive location globally even for the American market because we're right down the middle of the States.

Thunder Bay can offer a lot, and if we can kind of nurture that and grow with that concept I think we can rekindle the market a little bit, get consumer confidence up in this region and get spending back into housing.

It doesn't matter what market you look at: if housing is not booming, you don't have a very good market economically anywhere, so it's a good indication to look at. If you've got a booming housing market, you usually have a very stable economic climate.

Mr Kwinter: Have you done any analysis? Is the decline in housing starts because of affordability or because of population decline? Is there a pent-up demand for housing but people just can't afford to buy it or is there no demand?

Mr Williamson: I just think basically Thunder Bay is not growing. We have to get people to come in here. That's the pendulum. That's going to start the motion swinging, because it has kind of been stagnant. There really hasn't been a lot of growth in Thunder Bay for people coming in. I think the market has been dependent on existing families who have been supporting it. I think a growth issue has a lot to do with it. If you bring industry in and you bring professionals in-the hospital is a phenomenal opportunity for the community to start experiencing some of that growth. The casino was a phenomenal opportunity for this community to start experiencing some of that growth. We need a lot more of that. It's not enough. We need more.

Once you get industry coming in, you're going to get the jobs, you're going to get the families, you're going to get housing, and you're going to get stability.

Mr Christopherson: Thank you very much for your presentation. I want to tell you, it's a breath of fresh air to hear somebody from the home builders talk about the fact that higher wages are an important part of our economy. It's a shame that has to be seen as such a big deal, but very few will come forward and acknowledge that, I guess mainly because they're looking at the micro, maybe their own business, and cost is their bottom line. But at the end of the day, if you had the whole province working at minimum wage, you would be out of work. You wouldn't have a company, because nobody could afford to buy a house. So I really appreciate the fact that you at least acknowledge that.

I want to pose to you a dilemma, though, that I have trouble getting over in my own mind, and it's this. I can appreciate that you like the tax cuts. Nobody likes to pay taxes, nobody. If they can pay less, they're all for it, and you've advocated that the government continue to do this. The difficulty we see from our perspective is that this has cost us somewhere in the equation.

You mentioned what's been cut in education. I would argue that the government needed to take $1 billion out of education to pay for their tax cuts. You further talked about the lack of skilled trades, of skilled labour. Again, in order to do something about that, it takes a reinvestment of money. That's public money. It's hard to find a pool of public money when you've just cut your revenue stream and you don't have as much money coming in because you've cut the taxes.

The underground economy is being hit a lot. I heard from a lot of the construction companies, and I praise them for it, "Look, we're here to represent those who play above-board. We're prepared to play by whatever rules are fair for us, but you've got to make sure everybody is onside." Fair enough. But, again, in order to enforce-and that's where you put your emphasis-it costs money. Some things are recoverable but not everything. Again, we have this dilemma that in order to meet some of the needs you've identified for the future, we need to spend some money, but to do that at the same time that we're cutting creates a real problem.

Let me pose one more thing to you, and that is, if you've got people who are working in your industry-

Mr Williamson: I hope I-

Mr Christopherson: You can comment on whichever part you like.

Mr Williamson: No, it's just my memory. I hope I can recall-

Mr Christopherson: I'll give you a whole cherry tree and you pick the cherries you want. How's that?

Mr Williamson: OK, good.

Mr Christopherson: Today is clearly going to be a very sad day in a lot of households, as they watch their mutual funds go through the floor. With the downturn, there are going to be people it will affect. If all of this continues, there are going to be more and more layoffs, and it's going to be felt first right where you are, at the housing end of it.

I'm really concerned about what happens to your employees and other employees who get laid off, not because you want to lay them off but because you don't have the work for them. Only one third of all workers in Canada now qualify for EI. So if you aren't one of the lucky ones there, you fall through. Social assistance has been ratcheted down, again, to pay for the tax cuts, so a lot of people aren't going to make it there. In the course of one year, you could very easily go from making really good money as a construction worker to, a year later, putting your own house on the market because you can't afford to keep it any more.

I see all of these problems built into further tax cuts. We had mayors in here this morning saying if they don't get more assistance from the province, because of the cuts there, they're going to have to increase user fees, again affecting the quality of life. I just don't get how all of that is going to work for us.

Mr Williamson: But do you know what? It's the restructuring; that's what it is. You've started the process. You've made the cuts, and now it's a rebuilding time. So we're not saying, "Cut, cut, cut," with no reason. You're making cuts; you're making them in areas that needed to be cut, but now you can sit back, reassess any damage that has been done and rebuild from that. It's a learning process. I would say on that end that it's not just, "Keep her coming"; you have to do it within reason. But again, the underground economy-there are numbers that show the astronomical amount of money we're losing from that, and it's revenue recovery. It doesn't matter what process you go into. If we can start recovering some of that money, it would justify any of the cuts you're making in other areas. It's astronomical.

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When you get into the Thunder Bay area, it's 82% owner-built. Again, where are the controls, when an owner builds a house and a builder builds a house? If I build a house, I have the Ministry of Labour, I have everything, the process, all on me. When an owner builds a house, he doesn't have any of those restrictions. Nobody is checking his stuff to make sure everything was paid. Basically, again, enforcement: when you implement policies to control, they have to be fair across the board. We've been fighting for that fairness for everybody, right from notice of projects, because again, it starts the process rolling. If an owner built a house before-

Sorry if I'm-

Mr Christopherson: No, I was looking to see if I had time to ask you a follow-up question and he's signalling to me no.

Mr Williamson: I was just going to say that with an owner-built house, they didn't have to have the notice of projects, therefore the Ministry of Labour didn't have to go to the site. For owner-built houses we've actually pushed the issue, because the law was always there-it's just that they didn't really enforce it-that if you employ more than one person, you're classified as a constructor and therefore have to comply to the Ministry of Labour's guidelines. Our city was very receptive on that, to say, "OK, fine, we're going to start passing out those forms now," because an owner didn't have the obligation to go get one. Therefore, there is revenue that could have been lost because Joe up the street decides to do it for cash or another guy is working over here, and there's a lot of money lost in those areas.

It's working together as a team, working with the municipalities, with all levels of government, from education to labour to finance, putting the package together and delivering it. That's all we're saying, is to make sure, before you do it-I've always said when you get in there you should stay close to the people you serve.

Mr Doug Galt (Northumberland): Thank you for your presentation. It was most enjoyable. I appreciate some of the comments you made. It's delightful to have it juxtaposed with the gloom and doom we just heard from the third party. We heard their whole platform in about four minutes here. It's good to hear your comparison.

What I wanted to explore were the labour concerns you expressed. You expressed concerns about labour shortage. My understanding about salaries is that you were concerned about the high labour costs as they related to construction, and also the skilled labour. Certainly, as chair of the Premier's Task Force on Rural Economic Renewal, skilled labour in rural Ontario, small-town Ontario, was a very big concern.

Along with that, I've recently had a construction workers' union-I think their official name is Universal Workers' Union, number 183-come to my office. They do a lot of training of their own, just-in-time training, so if a large facility is coming in, they would have the workers ready to go as the tenders were released. In the area of construction, carpenters etc, they would have them ready to go.

It's refreshing to see this kind of thing happening in the private sector, rather than government. How much is this a government responsibility to have them ready, as you're describing-when I say "government," I'm talking about community colleges etc-or is it a union responsibility? Where does some of this lie? How do we make it happen?

Mr Williamson: First of all, it is a government responsibility because they've taken the task and they've been entrusted, as I said, with the stewardship of education for our children. It's a partnership everybody has to be involved with, right from the unions to everything. Nobody can just walk away from it. The thing is, we've already started the process. The educational tool has been the tool we use to develop a child's mind or set the direction they're going to grow in. We've removed that through the technical aspect.

Before, we had grades 7 and 8 shop. They're not there any more. You had high school, where in the introduction to high school you could take them out and they could actually work with the industry; you can't do that any more. Now it's two years into the system before they're permitted on the site. It's against the law in the province of Ontario for a child under the age of 16-and when I say "child," it's not a child; 14 years old isn't really a child but we're calling him a child-to be permitted on a site; it's a $25,000 fine. So if I had a co-op program that the board of education was trying to introduce, their hands are tied. Now do you get it?

It puts more responsibility on them. They've been cut so much. Go into their shop systems. Take a look at what they have to work with. The equipment is archaic. If you get into architectural services, they're running 386s, and we all know they can't keep up the process; Pentiums are all in there. So they're putting kids out into the system who are frustrated before they even get started.

Then you get into the technical sides where you get into the shops where they're using power saws and that. They're 40- and 50-year-old pieces of equipment and if they break down, it's a catastrophic event for one school. Right now there's $75,000 allocated through OYAP, which is the Ontario youth apprenticeship program, for all the schools for Thunder Bay; but the Toronto board gets the same thing. So all the schools are only getting $75,000. But it doesn't go for equipment. It just goes for the student who might need extra help on books or whatever else; it doesn't go for the actual development process.

So I think we have to look at developing that, because again, when we get into skills, to the migration of people coming over, we've lost that. You can get the stats on that. I had them and I was actually going to do a little bit of follow-up on that and I didn't have time. I'm sorry; I apologize for that. We used to have a high migration of skilled labour, but because the work isn't there, especially up here, they're not migrating here, so we don't have that resource to draw from. So we have to think of alternatives.

And we haven't been replenishing our youth, because everybody is saying, "Don't go into that. It's hard; it's tough. It's everything else." It's not. It provides a good life. You can make a good living and you can provide a good opportunity for growth in the family sector, like have a family, have a house and work that way.

The Chair: I have to bring the discussion to an end since we've run out of time, but on behalf of the committee, thank you very much for your presentation this morning.

LAKEHEAD ELEMENTARY TEACHERS OF ONTARIO

The Chair: Our next group is representatives from the Lakehead elementary teachers. Could you come forward and state your names for the record. On behalf of the committee, welcome, and you have 30 minutes for your presentation this morning.

Ms Christina Lofts: I'd like to thank you for the opportunity of allowing us to make this presentation. It's being brought to you from a local perspective. My name is Christina Lofts and I'm the president of the Lakehead Elementary Teachers of Ontario. My co-presenters are Sharlene Smith, vice-president, and Stuart McNabb, vice-president.

I just want to say that in spite of the funding cutbacks to education, the teachers are working very hard in the classroom and are providing excellent learning opportunities for the students, often at their own expense and certainly ensuring that these experiences will enrich the students and will provide the best possible citizens of this province for the future.

The Lakehead Elementary Teachers of Ontario are here to present their issues and concerns to the standing committee on finance and economic affairs. The Lakehead Elementary Teachers of Ontario represents 530 members, who belong to the Elementary Teachers' Federation of Ontario. LETO is proud to represent the interests of public elementary students and teachers and to defend the public education system. The need for this role has never been greater.

We'll first address the imbalance of funding. Last year, LETO spoke to you regarding the underfunding of elementary education. This year we bring the same concern. Although we believe the entire education system lacks the resources necessary to provide the best learning conditions for all Ontario's students, our purpose in this submission is to demonstrate how "student-focused funding" is especially punitive and disproportionately disadvantages our elementary students-our youngest and most vulnerable learners.

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The imbalance in funding between elementary and secondary students, although historical, is certainly not justifiable. Resources directed to the early learner not only improve a child's chances for future success in school but also save all of society significant expenditures in the future through reducing dropouts etc. This government has an opportunity to do the right thing. They had the opportunity to correct the imbalance that existed when they assumed control of education funding. However, they chose not to. Moreover, the new funding model actually has increased this gap between elementary and secondary funding. They took money away from early learners, increased primary class sizes, cut funding to students at risk, reduced the number of teachers in the system and cut valuable programs for elementary students. Let's take a closer look at what student-focused funding means for our children.

Cuts to the classroom: a good education system has many components, not the least of which is its teachers. Elementary teachers are on the front lines of education every day. They see the children who come to school hungry, frightened or hurt. Not only do they teach young students how to learn, they identify difficulties early in a child's education to ensure that the student can get the extra help needed to secure the best chance for success in later years. What did the new funding model do? It eliminated teachers; it eliminated programs; it eliminated resources for the early identification of special-needs students. The student-focused funding therefore resulted in fewer teachers for our students, not more.

A further casualty of this funding model is the loss of specific valuable programs and their teachers, such as instrumental music, industrial arts, home economics and teacher-librarians. Teacher-librarians were people who had specific skills in assisting the further education and the further implementation of curriculum with classroom teachers.

Our recommendations are that (a) the foundation grant for elementary pupils be increased to eliminate the gap in funding between elementary and secondary students; (b) all elementary schools have a minimum teacher-librarian allocation of half a full-time equivalent; (c) as a minimum, any funds generated for elementary education be used exclusively for elementary education, and both the ministry and school boards be required to report revenues, allocations and expenditures by panel.

Ms Sharlene Smith: Our next section is that research on class size overwhelmingly points to the importance of small classes in elementary schools. Student achievement improves in smaller classes; learning problems are more easily identified. Remediation can occur early, when it is most beneficial, and integration of students with special needs is more successful when class sizes are kept lower. Studies show that students who were in small classes in their elementary years benefited throughout their entire school career.

The special education funding drives more students into full or partial integration. Where these students are integrated, class sizes should be reduced even further, in order that the classroom teacher can give every student the valuable time each deserves. Adequate education funding should be available to allow special education teachers the opportunity to work directly with these students in order to provide the support and appropriate learning for the success of these students.

The restrictive space limitations, coupled with the mandated averages, increase the number of combined-grade classes. At the same time, the province also introduced grade-specific curriculum. In the context of larger class sizes and rigid grade-specific curriculum, combined grades disadvantage elementary students and increase the workload of your elementary teachers. Teachers have to prepare more lessons; students take more work home now. The average class sizes for combined grades are alarmingly high.

What happens in the first few years of a child's life sets the base for later learning. During their kindergarten years, children acquire important skills, knowledge and attitudes that will affect their ability to learn. Class sizes must be reduced to allow for more teacher-student interaction. Children in kindergarten are involved in problem-solving, literacy, numeracy and developing their social skills. Adequate funding must be there to ensure they get a fair start in lifelong learning.

Ontario's elementary students are being forced backward at a time when the trend in other provinces and even in the United States is to recognize the importance of early years through injections of new money aimed at reducing their class sizes. For instance, initiatives in British Columbia will mean no kindergarten class over 20, and grades 1, 2 and 3 will have 22 by 2000-01. California launched a US$1.5-billion effort to reduce class sizes to a maximum of 20 for students in kindergarten through grade 3. In the United States, President Clinton introduced a seven-year initiative to reduce early-years class sizes to a national average of only 18. The recent settlement in Quebec includes a four-year, $100-million reinvestment in the education sector to hire 2,000 additional teachers to reduce kindergarten through grade 2 class sizes.

If this government wants our students to excel, with particular emphasis on grade 3 and grade 6 testing due to standardized tests, then they must fund the appropriate supports by providing an infusion of money for textbooks, resources and fewer combined grades in the elementary grades, especially within grades 3 to 6, to build a strong foundation for future learning. Teachers are presently delivering programs without textbooks and resources. They must find or create the appropriate support materials for their own curriculum.

Our recommendation 2 is that (a) funding be provided to reduce class sizes in kindergarten to grade 3 to no more than 20 students, (b) funding for full-day senior kindergarten be restored, (c) real caps be placed on elementary class sizes, (d) class sizes for grades 4 to 8 be no more than 22 students and (e) adequate funding be provided for textbooks and resources for classrooms.

Special education needs: Parents, teachers and school boards have been telling the government for years that programs for students with special needs are dangerously underfunded, cheating these students of the extra supports they require. Underfunding in these programs hurts young children disproportionately. Learning problems and exceptionalities must be identified and addressed as early as possible. The role of the special education teacher has become one of filling out forms and reports, which generates hours of work, when applying for special education funding. This is more costly and less effective. Remediation is what is needed if special-education programs are cut or time continues to be used for paperwork. Identifications are slower. Students are now on waiting lists for placements, or programs are dropped for lack of funding. Our youngest students are being robbed of their futures.

One of the problems we have is the failure of ESL funding to capture the needs of those students born in Canada who come to school from non-English-speaking households. These students entering school are suffering because language programs are inadequately funded. They do not qualify for ESL teaching support.

When children are at risk due to their socio-economic circumstances, their best chances for success rest in what the school setting can do for them in their earliest years. If they get enhanced programs, help with reading and individual attention, they have chances for success that their home environments may have otherwise denied them. A government that continues to fail to fund the needs of special-needs and high-risk learners is a government that will condemn these children. In the end, this ill-informed, mean-spirited view of educating Ontario's most needy will cost all of society more in human and financial resources later. This situation is reminiscent of the stance this government has taken towards blaming the poor for Ontario's economic deficiencies.

Our recommendation 3 is that special education, learning opportunities and ESL grants be increased with new money to address the needs of these elementary students, and that ESL grants include students who come from non-English-speaking Canadian families.

Mr Stuart McNabb: The model funds pupil spaces-maintenance, renovation and new spaces-at a lower level for elementary students than for secondary: 100 square feet per elementary student and 130 square feet per secondary student. This limitation is arbitrary and unrealistic in a time of child-centred learning. Young students need as much space as older students. To limit them is to limit their learning opportunities.

The space limitations are forcing school closures, which means some students as young as four years of age are now spending an hour or more on the bus in order to attend larger schools further from their homes. There are other repercussions. When a school closes and students move to a neighbouring school, it means loss of program. The loss to the community is immeasurable. The receiving school must convert science labs, libraries, music or special-education resource rooms to classrooms to accommodate the influx of students. Class sizes will be driven to maximum capacity, making it impossible to lower elementary class sizes.

Our recommendation 4 is that the formula for funding elementary pupil spaces be increased.

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The funding formula further undervalues elementary students by undervaluing their teachers. The formula does not even meet the standard set out in Bill 160. Consequently, elementary teachers are left to implement nine new curricula in larger classes with more special-needs students. Despite these increased demands, administrative support has been reduced, special-education support has been reduced, new report cards have been implemented and documentation requirements are escalating. Without textbooks, resources and materials, teachers spend many hours searching for age-appropriate materials in order to deliver the programs. This requires time and effort in addition to the normal classroom expectations. As part of their regular routines, teachers continue to liaise on a daily basis with parents and outside agencies. The expectation is that elementary teachers do all this with a level of support significantly below that given to our secondary colleagues.

Therefore, it is the recommendation of LETO that prep time for elementary teachers be funded at a rate no lower than the 200-minute standard set out in Bill 160. Meeting these recommendations would go a long way to restoring the quality of elementary education, which we believe has been eroded since the inception of the current funding model.

Our recommendation 5 is that prep time for elementary teachers be funded at a rate no lower than the 200-minute standard set out in Bill 160.

By removing from boards of education any flexibility to access local taxes for local initiatives, the new funding model stifles innovation. The way to ensure flexibility and innovation is to return to school boards access to their own sources of funds. This will also ensure that programs match community needs. Other factors must be taken into consideration-geographic isolation, population etc-which drive the cost of materials and availability of resources higher. Lack of funding forces school closures and a move toward placing elementary students into secondary sites.

Our recommendation 6 is that the right to levy taxes for local education needs be restored to school boards.

Teacher shortage: Teachers perform one of society's most important jobs. They shape young minds. Our future voters, taxpayers, Prime Ministers and Premiers are sitting in elementary classrooms right now. They are students today, developing into the citizens responsible for the society we leave to them tomorrow. Every day, elementary teachers invest in that future. They invest their time, their energy, their own money and their expertise in young people. It's time the government invested in elementary teachers. In this time of teacher shortage, the government needs to make teaching an attractive alternative for our university graduates.

It's our recommendation that the funding formula fully recognize increases in inflation and enrolment and, secondly, that the overall funding for elementary and secondary schools be increased immediately to reverse the cuts to funding that have been made since 1995.

Ms Lofts: This government wants to be proud of our education system, and so do our teachers, parents and students. Lakehead Elementary Teachers of Ontario is looking to this government to restore funding so that Ontario can return to being the leader in education in this country.

Studies clearly show that the long-term benefits of early childhood education far outweigh its cost. Indeed, for every dollar spent on early education for four- and five-year-olds, the benefits gained by the whole society are over $7.

Our commitment must be to an education system that emerges strengthened and enhanced. It must be accessible to all students, and equal opportunities for success must be available to all. In this way, the investment we place in these young citizens will reap benefits for the community and the future.

The last page is a summary of all our recommendations.

The Vice-Chair (Mr Doug Galt): Thank you very much for an excellent presentation with precise recommendations at the end that bring it to our attention. We have about three minutes for each party. We'll start with Mr Christopherson.

Mr Christopherson: Thank you for your presentation; it's very good. I'll start by mentioning that special needs continue to come up at every single location, every hearing, every community, and I go through it in Hamilton. I'm just glad you've raised it. If you want to add anything a little later-I have one question-please go ahead. We've got to underscore this. We've got to put enough heat on the government that they take the pressure off that. We've got kids who should be in school, could be in school, used to be in school and aren't, and it's simply because of the dollars.

Also, the cuts to the classroom have been a fascinating shell game to watch as the years have unfolded. What the government did was say, "We're going to focus on those things that affect the student in the classroom. That's going to be our emphasis." They call it student-focused funding. Then what they did was redefine those things that they determined constitute classroom funding versus others-administration. In doing that, you know as well as I do that they cut out custodial work. They cut out transportation, and I would think that's huge here and wouldn't mind hearing about that. I know it's huge in my new city, and it's not nearly the geography we're talking about here in Thunder Bay. The maintenance of computers isn't considered part of it. The hydro, heating the classroom-those things somehow magically don't have anything to do with what is happening in the classroom.

In effect, what they did was reduce all these things, take those out of the equation, and then throw a little bit of money at what is left and say, "There you go. We increased student-focused funding by X percentage of dollars. We're the ones who really care about kids." It's tough to get the message through to the public that you've got to look past the rhetoric. You've got to take a look at what is left in that funding. What are the things that were defunded in order to pay for the tax cut, and what was the trade-off in terms of the few dollars that went back in?

I wanted to hear whether or not that's what you've experienced and what your view is from this part of the province also.

Ms Lofts: What we found ourselves in is that when the new curriculum came forward, we very energetically became involved with it and studied it, but without any resources, without any training and without any textbooks. Right now I am in the process of collating information from our classroom teachers which clearly indicates we still do not have textbooks in our classrooms or the resources in order to assist us in the application of the curriculum.

What the teachers do is go on the Internet and search out the materials. They have to make it age-appropriate because a lot of the resources are designed for the adult learner, so we must make them suitable for the age-appropriate classroom. That's the first thing.

The other thing is, you're right about the custodians. We used to have the custodians come into the classrooms on a daily basis. They are only able to clean the classrooms every second day. That becomes a health hazard. There are other issues associated with that. They aren't able to do all the work that they used to do, and this impacts our classrooms, our day-to-day environment. I've often said to my students, "This is our living space for at least a five-hour day every day. It should be healthy and it should be clean. It should be a place that we want to go to every day."

When you mention special education, you're absolutely right. The government has forced teachers, and special education teachers, to do hours-I have heard up to 400 hours a year-of paperwork in order to make applications for funding. They are filling out special paperwork for testing because there is an auditing done of the boards. They spend hours and hours doing the paperwork. They are not able to provide direct service to those students who need it. The time that is there, the money that is spent in paying for their salaries, is just an extension of a job that is now part of, I guess, a government job, because they're doing the paperwork.

The Vice-Chair: We're well over four minutes. We're going to have to move on to the government.

Mrs Molinari: Four minutes is hardly enough time to address a lot of the points that you've made in your report. We've had several presentations from various teacher groups and there seems to be some consistency in some of the comments that are being made.

I would just like to put on the record a couple of things. The funding model that is presently in place is a far fairer model than the one we used to have. Over years and years, studies have been done that determined that the funding model was flawed, and yet no government prior to this one had the courage to do anything about it and change that. This funding model now allows for every student in the province to have equal access to equal dollars. The old funding formula gave rich assessment boards more funding than poor assessment boards, and it was not equitably distributed through the province of Ontario. The reasons for the change in that were called upon by all boards, teachers and everyone. There was a problem with that. The way the model is now, it's more equitable to all the students in the province.

I want to also address some of the comments you made on special education. It's certainly a very important factor. Having been a school trustee for 11 years and chair of a school board and also chair of SEAC, I know a lot about the issues with respect to special education. It's ever-evolving. I don't think we're ever going to reach a point in time when we say that it's perfect, because students are all different. They all learn at different levels, especially our special-needs students, and that is evolving. I understand there is a lot of paperwork that is done by teachers, and the Minister of Education is very receptive to input from everyone on how best to serve those students, because at the end of the day that's what we want to do: serve those students to the best of our ability.

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You talked about some combined grades. Combined grades are a reality in any small school, and that is an issue that's been ongoing in a number of areas, but it's a reality when you have small schools that you're going to have combined grades. The best way to approach that is to look at the individual student and certainly the principal along with the teacher to decide on which students would benefit best from a combined grade rather than a strict grade.

Teacher shortage is worldwide; it's not just in Ontario. As a matter of fact, the chair of the Toronto District School Board, Irene Atkinson, recently reported that it's not just an Ontario problem; it's a worldwide problem. Certainly it's something that as a provincial government we need to address, but it's not something that is just an Ontario problem.

Learning materials-you talked about textbooks. The way the funding model is now, there's specific money given for students for textbooks and it's up to the school boards to determine how that money is spent. It is one of the envelopes where there's some flexibility and the school boards have the ability to do that. Is it something that we should look at, taking away the flexibility so that boards have to spend it specifically on textbooks? That's a question that we're looking for input on. Is that something boards are asking for, more flexibility on how they spend their dollars? Because most boards are spending above the average salary that is given for grants, then boards need the flexibility in other areas to be able to provide for some contractual agreements that they presently have. So there are a number of issues. I think I'm running out of time here.

The Vice-Chair: Ms Molinari, you've used up four minutes. That's a minute over what you were allowed.

Due to the circumstances, you won't be able to respond to Ms Molinari, but I can give you two minutes to wrap up. If you want to make reference to her comments, you may, but you have two minutes to wrap up.

Ms Lofts: I'm going to say that the funding model just doesn't fit, so the government has to look at it again. It doesn't address the inequities, it doesn't address the transportation costs we have in the north, and it doesn't address what is happening in my classroom. So if you're going to tell me you've put enough money there, I'm going to tell you it isn't enough.

With regard to what are appropriate incentives, if we have a global teacher shortage we want to attract the best-qualified and the best teachers to our province. You know, the United States is doing it. The incentives have to be there, and that does cost money as well. We want to make sure we have the best possible system.

Combined grades? You have a double curriculum there. We need to address that issue. We need to address how those teachers can deliver that program as effectively as possible. We need to make sure the best funding model truly does address the concerns in the classroom, because the people in the classroom are our future and we need to make sure the money is there, all the money that is necessary.

We also need to look at the way all the paperwork and all the other things that go along tie the hands of boards, yes. But you have the money now. You have a surplus. You can direct that surplus into what is going to come back and reap benefits for you, and that is our recommendation.

The Vice-Chair: Thank you very much for your presentation. We much appreciate it. The recommendations are very specific, and we appreciate that. Have a good day.

ONTARIO MINING ASSOCIATION

The Vice-Chair: Our next delegation is the Ontario Mining Association: Patrick Reid, president, and Peter McBride, manager of communications. If you're both here, come forward. Welcome, and state your name at the beginning for the record. We look forward to your presentation. You have a half-hour in total for presentation and the remainder that you don't use will be split up among the three parties here.

Mr Patrick Reid: Thank you, Mr Chair. I'm Patrick Reid, the president of the Ontario Mining Association. My colleague Peter McBride is attending an energy committee meeting across town, so he will not be with me. He has let me out on my own today.

I'd like to thank you folks for coming to the northwest part of Ontario. We're in the middle of Indian summer here, as you've probably noticed. I come from this area. I was born in Fort Frances, some 220 miles west of here, raised in Atikokan. I represented Rainy River in the Ontario Legislature for a few years.

Mr Christopherson: Welcome back.

Mr Reid: Thank you. The Ontario Mining Association has been holding its energy committee up in Thunder Bay. We have a number of mines in the area. They have gold mines: the Red Lake gold mines; Musselwhite, north of Red Lake. Yesterday we had a tour of the Palladium mine, North American Palladium, who are just undergoing a US$125-million, so about C$250 million, maybe more-I've been away from the financial centre of the universe-depending on what's happened to our currency. So they're investing US$125 million in a new facility, which is about an hour-and-a-half drive north and a little west of Thunder Bay.

I probably will not take my full time. I again want to thank you for coming to this part of the province. I think it's very useful for MPPs to see the rest of Ontario and certainly to get a feel for how big the north is. I don't want to lecture you, but you're probably aware that if you look at a map of Ontario, you see that southern Ontario looks like it's about three quarters of Ontario. If you look at a real map, you'll see that northern Ontario is 80% or so of Ontario and southern Ontario is only about 20%. So we have those problems of time and space and communication in this part of the country.

I'm not going to touch on everything in the brief. I just want to reiterate for you that modern-day mining is a high-tech industry. We can't compete around the world unless we are in the high-tech business. I grew up in a mining town. It's amazing to see what has happened in mining in 30 or 40 years since I first worked in a mine. But we are a high-tech industry. We are not a pick-and-shovel industry.

We have about 20,000 direct jobs in mining. They're high-paid, high-skilled jobs with about 70,000 spinoff jobs. We're a major provider of government revenues. We have very high productivity. Our productivity is twice that of manufacturing. A large part of what's directly responsible for that is the high-tech end of our business. Our value added is about $205,000 per employee annually. We make significant investments in employee safety and training, environmental protection and research and development. With a lost-time injury rate of 1.4 per 200,000 hours, mining is the third-safest industry in Ontario, behind hospitals and the pulp and paper industry. We are the main economic engine in 50 Ontario communities, including many in northwestern Ontario and a number of mines in southern Ontario.

In recent years the provincial government has given a big boost to mining, particularly in last year's budget, when the Treasurer announced that there would be a 50% decrease over five years in the Ontario mining tax; there has been an offer of a 10-year Ontario mining tax exemption for new and remote mines. We may well have a new diamond mine up near Attawapiskat, near James Bay, hopefully. You've made available tax incentives for investors and flow-through shares invested in geoscience and advanced technologies. The government has also promoted mineral exploration activity through its Operation Treasure Hunt and earmarked $29 million over three years and, importantly, has invested $27 million in the rehabilitation of abandoned mines and mine sites. Industry has been assisting in this area.

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Ontario has a long history of mining and in fact is very responsible for the opening up of a large part of Ontario, particularly northern Ontario. But there is a legacy of mines that were shut down, some as many as 100 years ago. They were shut down without the knowledge we have today of possible environmental and/or health and safety hazards. So there are some of these sitting out there that the government is doing a good job in rehabilitating, making them safe and stopping any environmental problems, but much has to be done.

All these have had a very positive impact on the investment climate for mining in Ontario, and the Ontario mining industry is very grateful for them. We still have a vast geological potential for future mineral development which will benefit all Ontarians.

The response to these moves by the government has been that exploration has increased by over 20%. Falconbridge in Timmins has announced a $650-million investment in its Kidd Creek mine. That's the second-largest investment that was announced last year, other than the Toyota plant. Inco has announced expansion plans and investment of $116 million in new developments. Barrick Gold is expanding its mill at the Holt-McDermott mine. I've mentioned De Beers, a possible diamond mine at Attawapiskat. Northwestern Ontario, where we are presently, is sharing in this new and renewed mineral development. I've mentioned North American Palladium spending $125 million to upgrade and expand its Lac des Iles mine. Goldcorp opened its Red Lake mine last year; that was about $90 million. Kenora granite is putting $4.5 million into a dimension stone quarry south of Red Lake near Ear Falls. Along with continued production from its Campbell mine, gold producer Placer Dome is putting up more than $8 million for exploration in the Red Lake area and has spent $90 million sinking a new shaft in the Madsen-Red Lake area.

All of these have a very positive effect on the city of Thunder Bay, because a lot of the people are from Thunder Bay or live in Thunder Bay, and most of the goods and services that are provided to these mines are either provided directly by Thunder Bay businesses or are in transit through Thunder Bay. Musselwhite, for instance, includes 260 direct jobs, including 60 from the first nations, a monthly payroll of $1.7 million in wages and benefits; $700,000 in monthly expenditures on various types of energy; $2.6 million spent monthly on other goods and services, with about half of that being spent locally. The types of goods and services provided by local companies to Musselwhite include flying services, explosives, trucking, janitorial services, catering, underground mining equipment parts and maintenance, fuel, hardware, lubricants and service vehicles. First nations companies are providing several of the goods and services purchased by the mine, and it is estimated that Musselwhite generates $56 million in benefits to Thunder Bay.

North American Palladium's major expansion means that Thunder Bay is a prime beneficiary of the socio-economic benefits generated by the mine. The expanded Lac des Iles operation will spend more than $55 million annually on labour, goods and services, with more than $28 million of that total being spent in Thunder Bay. The expanded Lac des Iles operation will support 700 full-time jobs in Ontario, 234 direct and 466 indirect and induced. Employee-related payments to governments, in taxes etc, are anticipated to be in the range of $4.5 million.

Mining operations strive to be responsible partners in society, making contributions in the communities where their employees live. I might add that there are only two palladium mines in North America. One is Lac des Iles, which I referred to; the other is the Stillwater mine in the United States. Other than that, most platinum and palladium comes from Russia. Palladium, particularly, is used in catalytic converters for automobiles, to take some of the noxious gases out of the air. It's used as a cleansing instrument for combustion in automobiles.

The mining-you have this; I'm not going to go through the rest of it. A recent survey had indicated that in North America, Ontario is third-ranked as a place to look for and invest and develop mines. This is largely due to our geology, but also government policies, including tax rates.

That's all the good news. There are a few-

Mr Galt: Stop there.

Mr Reid: You'd like me to stop there? There are a few flies in the ointment. One is in the area of property taxation. The Chair is well aware of this situation. We have a situation where two uranium mines in Elliot Lake went out of business in the late 1980s, early 1990s. One by-product of mining is that you have what are called tailings, the waste rock after you've extracted the minerals. You have to store these on, usually, very low-grade land. Mud is what it is, generally, and it's usually placed in low-lying areas, usually in what amounts to swampland. The mining companies are no longer situated there-the ore had been mined out-but Elliot Lake is asking for a review under the assessment review commission to have the land on which these tailings are situated elevated from commercial, the lowest rate, to industrial or occupied-industrial rates. This would mean that for all of the mining companies across Ontario, probably, if this went through, their taxes for basically what are sterile areas not useful for anything else could go up anywhere from 300% to 400%, depending on what happens. This is not, believe me, an incentive to look for and develop a mine in Ontario.

In fact, mining companies are required by law to rehabilitate the lands, which means taking down the buildings, capping the shafts and making sure that the tailings areas are safe and secure. Under market value assessment there are no willing buyers for this property. So the property is worth nothing, in effect. The mining companies would be quite happy if somebody would take it off their hands for a buck. This is a bit worrisome for us and we hope that through Mr Beaubien's committee there will be a rational response to this particular problem.

The other problem, and I think it's much larger than just for the mining industry, is energy costs. Mining operations spend about $250 million annually on electricity, and Ontario has the second-highest industrial electricity rates in Canada. The current rate freeze is very helpful, but we really need to move to a competitive market in electricity. Between 10% and 15% of the cost of producing metals is related to energy, but in the pulp and paper industry-and they can speak for themselves, but we've been talking to them as well-they're up in the 20%. So if these costs of energy go up, unfortunately unemployment goes up as well, because people have to cut costs somewhere and often it's the worker who unfortunately gets stuck holding the bag for these increased costs. So we need to really go to the competitive marketplace, and we realize the difficulties that have been experienced in Calgary, Alberta, and California, but there have been particular reasons why those things have gone awry out there.

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We would like to see the government sell the transmission and generation assets to reduce the stranded debt and ensure that the need for the creation of a genuine electricity market is met.

The third issue we have is the inclination now of government ministries, particularly environment, to do what they call cost recovery. We have no problem with the concept of cost recovery if it is directly related to the services that are unique to, in our case, the mining industry. However, it would appear that the recent initiative of the Ministry of the Environment is to recover more than just cost recovery for those areas and to in fact come in the side door with what amounts to taxation. The Ministry of the Environment is proposing to charge companies to report their air emissions and monitoring, to set up an emissions Web site database which would be accessible to the public, for instance. We think this is something that should be paid for out of government revenues. It is one thing to have user fees which realistically cover the cost directly associated with administration fees for a licence, but fees to cover the cost of government programs are probably more suitably financed from general government revenues. The OMA would like to see a limitation on the apparent proliferation of these cost-recovery fees.

And-the best words that I know you hear from everybody who sits before you-in conclusion, the government has done a great deal to restore the recognition and encouragement of responsible mineral development in Ontario to benefit all citizens. We would like to see the government continue on that path. Thank you very much today for this audience and best wishes in your work in helping to build a budget for the next fiscal year which will benefit all Ontarians. Thank you, Mr Chairman.

The Chair: Thank you very much. We have approximately three minutes per caucus and I'll start with the government side.

Mr Galt: Thank you for your presentation. I remember several presentations last year on mining. Of course the concern was the 20% tax, and more equitably it would be at 10%. As you know, and have in your presentation, the Minister of Finance in his budget last May did come through with reducing this over some time, 20% to 10%, and also the exemption for exploration.

We hear the criticism from opposition as we cut taxes, "There's going to be no revenue to do other things with and therefore you're going to have to cut," and all the rest of it. What I want to explore here is that you mentioned different mines being opened etc. Down the road, with the change in that tax structure for the mining industry-and I know you won't have the specific dollars; there's certainly stimulation, and you've indicated that-to what degree do you anticipate this? Would it double the mining industry in Ontario, therefore compensating for that 50% cut in the tax? Will more mines come on? Will current mines step up their production etc? How much of a feeling do you have as it relates to tax recovery?

Mr Reid: First of all, miners are the highest-paid industrial workers in our society, so the more miners you have the more they're paying in income tax to the provincial coffers. We also pay, by the way, corporate income tax. For those taxes, the more income they earn, the more they will pay. I can tell you that in at least two or three instances the cutting of the Ontario mining tax resulted in a positive investment decision by three companies that I know of. They frankly don't tell me everything about their internal workings, especially when their price is going up, or down, for that matter, but it certainly has had a very positive impact. I think the more economic activity that you generate, obviously the more taxes the government is going to get. I can't give you a specific number but I can assure you that it has really focused people's attention on Ontario as a place to explore and develop mines.

Mr Galt: I think I've come across someplace where we're now the third most competitive region in the world, or in North and South America.

Mr Reid: We're seen as the third-best place to look for and invest in mining, Nevada being the first one. These recent changes moved us up from about sixth place to third.

Mr Galt: From what I've heard from your comment, we may not recover fully that 20% to 10% loss, but where we will recover is in other corporate taxes, in other income taxes from miners, who I think you said were the highest-paid industrial workers in the country. That will more than compensate for that reduction in-

Mr Reid: Absolutely. Yes, it will.

Mr Kwinter: Thank you very much for your presentation. It's rather nice to suddenly hear you in a positive sense, because over the years when you've appeared before us we've always acknowledged that Canada had the reputation of having the best mining people and we certainly had good geology, but, notwithstanding that, a lot of Canadian mining companies were going other places to invest because of the climate, and that's changed. I think that's good.

I want to address some of the negatives that you're still pursuing. One of them has to do with the slag storage, or the tailings. Are mining companies getting secondary recoveries out of those tailings?

Mr Reid: In some cases they've tried. For instance in Cobalt, they've gone back and run some of the old tailings through a mill to recover the cobalt and silver. In some of these old mining camps where the technology wasn't as good and they got what we call low-recovery grades, they left a lot of the metals in there. But it's not a big thing.

Mr Kwinter: You say it's not a big thing. The reason I raise that is, if that is the case, it's hard to justify a finding that there's no activity taking place on those lands and they shouldn't be taxed if in fact there is commercial activity by the secondary recovery of tailings. I'm just raising that as a question.

Mr Reid: I think, as I say, you could buy them from a company pretty cheaply, if you wanted to try that yourself. In most cases there's no value to them.

Mr Kwinter: The second comment I'd like to make is that I agree with you that the current energy issue in Ontario, and electricity particularly, could potentially be a very strong deterrent to a lot of economic activity. I'm curious to see where you suggest there should be some competition in the transmission. Transmission lines are a natural monopoly. I hope you're not suggesting that companies should come up and set up competitive transmission lines on the grid.

Mr Reid: No. We're more concerned about the generation, really. It's the generation where the problem is. Right now, Ontario Hydro, no matter what they say, is still controlling all the generation, and nobody is going to come in and set up any generation facilities until they can be sure that there will be open competition.

Mr Kwinter: I agree, and we've raised that question from day one. As I say, I just picked up on the fact that you included transmission.

Mr Reid: I think what we're getting at there is that we're a little concerned that Hydro is buying up all the municipal transmission systems, which again puts them back in a monopoly situation.

Mr Christopherson: Thank you for your presentation. Let me make two comments at the outset: one, if the government was hell-bent for leather to go ahead and cut taxes, then let me say that the money invested in the cuts to the mining was probably a good idea. There was more that needed to be done in the north. Other than the fact that we didn't think it was a time to be cutting taxes, if you're already into that world, then at least there's something productive about that that's going to lay the groundwork. I don't disagree with what the good doctor raised in terms of future revenue and job growth, as well as economic growth, as a result of that.

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Having said that, I also want to point out that the long and bitter strike at the gold mine in Red Lake was certainly a real black eye to that company and, I suggest to you, didn't do mining overall a lot of good. There's a lot of reverberation, certainly within the labour movement across Ontario, as a result of that. It's the sort of vicious labour relations that does a lot of damage to business and sends out a bad signal to investment, I would say, not to mention to the ability of those people you said make good money. Part of that is having collective agreements, because you sure can't rely on minimum wage in this province to give you a decent standard of living, and of course you can comment on that if you choose.

Having said that, I want to make one other observation and ask your thoughts on it. You mentioned flies in the ointment, and you mentioned two examples where the municipality was making moves you have some difficulty with and probably-I don't know that you used the term-would see it as a cash grab. To you, it was a way not fairly applied in terms of extracting money. Then on page 10, you also make reference to a number of provincial ministries that you likewise believe are charging you money that you really shouldn't be paying. Then you say, "But fees to cover the cost of government programs probably are more suitably financed from general government revenues."

The dilemma is that if everything is "Cut taxes, cut taxes, cut taxes," and that's your way to ride the boom as well as get out of a recession or a downturn, if that's everything, then at the end of the day it shouldn't be surprising that municipalities-if you heard the two mayors who were here this morning talking about the cuts they've had to their budgets, which is what the provincial government had to do in order to do all the tax cuts, particularly on the income tax side that especially very well-to-do Ontarians were very happy with. The same with the ministry itself: once they cut their own budget, then they also have other demands, and they try to find those internally without having to go on bended knee to the finance minister saying, "I need more money in my budget."

My question to you is, this blind drive toward tax cuts above all else, in my humble submission, is going to result in these sorts of things in a whole host of other areas, and the two just aren't compatible. There's got to be a balance, and what we don't have in this province is a balance. So maybe your thoughts on those things.

Mr Reid: I don't comment on individual companies-you referred to the strike. I have no mandate. As a matter of fact, I would be among the ranks of the unemployed if I did.

Mr Christopherson: Fair enough.

Mr Reid: I would only comment that there are always at least two sides to each story, but I can't comment otherwise.

In terms of the dichotomy supposedly between cutting taxes and providing services, I think the theory-and it has been seen to work in some jurisdictions-is that if you cut taxes, you put more money back in the hands of the consumers, who are responsible for 60% to 70% of the economic activity in the economy. The more the consumer has to spend, the more he/she/we will spend, and that in fact creates economic activity. As the pie grows bigger, you get more revenue. That at least is the theory.

We had somewhat this discussion last time, as I recall, Mr Christopherson.

Mr Christopherson: That's right, we did.

Mr Reid: I guess I still hold to the view that creating jobs is the main thing. If people have jobs and they have money, then they're paying taxes and companies are paying taxes, and hopefully there will be enough to go around.

As far as the municipalities are concerned, I'm not always sure that-and I come from this area, so I say this and I'll get in trouble. As a matter of fact, I ran into one of the mayors downstairs who was before you. He's an old friend of mine. Municipalities have a tough time raising funds, and I'm not speaking specifically of any community. If you look at the tax rates in some of these municipalities, the residential tax rate is relatively low for the services they get.

I'm probably sounding very nostalgic when I say there used to be a connect between taxes you paid and the services you got. There now seems to be a complete disconnect. But for accountability purposes I think that if people in municipalities were paying more for their residential taxes, they'd be more aware of the services they were getting and they might be saying, "We can do with this and maybe we don't need that." In many of these municipalities, the commercial-industrial is carrying 70% of the tax load, and the residents, who are getting most of the benefits-not all of them, because obviously it's a bigger situation than that-

Mr Christopherson: Of course municipal property taxes are very regressive.

Mr Reid: That's a problem.

The Chair: With that, I have to disconnect the discussion, because we've run out of time. On behalf of the committee, thank you very much for your presentation this morning.

Mr Reid: Thank you very much, and enjoy yourselves in the beautiful northwest. You really should come back in the spring and summer.

CONFEDERATION COLLEGE

The Chair: Our next presenters are representatives from Confederation College. Would you please come forward and state your names for the record. On behalf of the committee, welcome. You have 30 minutes for your presentation.

Ms Pat Lang: Thank you and good morning. My name is Pat Lang, and I'm the president of Confederation College. David Ramsey is with me today. David is a member of our faculty union. I also have two other people in the audience from the college. Larry Brigham, a counsellor who works directly with our students, is here. Jan Lewkin has just arrived. Jan is a member of our board of governors. Lorne Sarmiento was here a moment ago; I think he has disappeared. He's the president of our faculty union.

Thank you for the opportunity to be here today and to present. I'm going to use overheads. Does that work for you?

The Chair: Yes, you may.

Ms Lang: I also have copies of my presentation for you, so you can take notes on that, if that makes it easier for you.

First of all, thank you for the opportunity to be here today. I realize you had more requests than you could accommodate, so I certainly value the opportunity for the college to present here today, and I know my colleagues do as well. Thank you for the invitation and for accommodating us.

I'm going to speak about three things today. First, I'd like to tell you a little about who we are as a college; secondly, I'm going to talk about what our major issue is; and, thirdly, I'm going to leave some recommendations for you.

Given that this is the pre-budget consultation process, I assume you can well imagine our biggest issue is going to be funding. I'll begin by talking about who we are as a college. I know you've been completing these exercises elsewhere, so you have a sense of what the community college system is about in Ontario. In terms of our particular college, we have 4,500 full-time students and 10,000 part-time students. We offer a full range of programs, from post-secondary education through to apprenticeship and basic skills. We're not dissimilar to other colleges in that we serve a fairly large region. Our main campus is here in Thunder Bay, and we have six regional centres as well, as far north as Sioux Lookout. Geraldton, Marathon, Fort Frances, Kenora and Dryden are our campus locations, so it is a very large territory that we serve. We tell people the territory we serve is the size of France, if that gives you a context in terms of distance and space.

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We have over 50 post-secondary and post-diploma programs at the college. If we had three hallmark programs, or programs for which we would be best known, they would be our aviation programs. We have aviation maintenance, flight and manufacturing, and we have aboriginal programs. Law and advocacy tends to be the one for which we're most recognized. Our newest programs are in the field of media: film production and multimedia. So that's just a general overview of who we are and what we're best known for.

Just so that you can see the size of the area that we serve in comparison to the rest of the province, the other 24 colleges consume this part of the province, and this is the large sector that we serve as a community college. It serves area 18, which is over half the land mass of Ontario.

The other interesting statistic that I can share with you today is that Confederation College is the largest user of Contact North services. We use Contact North as our means to connect with our communities to be able to provide both part-time and full-time studies to the students within the catchment area.

I just want to give you a little bit about the history of the funding for community colleges and how it's changed. These statistics that I'm sharing with you are provincial statistics. The enrolment in community colleges in the last 10 years has increased by 35%, and government funding is down 39.9% of operating funds. We are the hardest-hit sector per client of all sectors that are served by the government. In Canada, nine provinces have already increased their post-secondary funding, and 43 out of the 50 states have increased their post-secondary funding as well. The Ontario colleges are one of the lowest publicly funded systems in Canada and the United States. This is a major issue for us as we try to meet the needs of our communities.

One of my fundamental beliefs about community college education is that we are inextricably linked to the success of the community. When communities are successful, the college is successful, and the opposite of that is also true. The reason for that is because of our link to economic development. We prepare people for the workforce, so the colleges do play a critical role in our government's agenda.

Just a story about tuition fees and how the tuition fees have changed over the years. Since 1991, tuition fees have increased 132%. We are now limited to a 2% increase in funding, but the overall average in that last 10-year period has been a 132% increase. Even with that increase, we are still below the average and the median of all provinces in Canada. The university tuition fee is almost $4,000. But probably one of the biggest concerns we have is that student debt continues to rise. It's not uncommon for us to hear of students graduating with $20,000 and $40,000 worth of debt after having completed their post-secondary studies.

There has been an argument that the tuition fee is meant to offset the decrease in government funding. That does not compute. The net decrease in funding, regardless of the increase in the student funding, is a 35% difference. So we still have a decrease of 35%, regardless of the increase in the student tuition fees.

I'll give you an example of what's happened to our operating revenue in the last few years. Initially, in 1994-95, we were operating at about $63 million, and right now we're just about $45.5 million. That's the graph that shows the decline in the funding to our college, in particular, during that same time period.

What kind of an impact has it had? We've eliminated 10 programs that we previously were able to offer throughout our catchment area. We've consolidated seven of our technology programs. The reason that is significant is that one of the areas this province needs to continue to prepare graduates for is the whole field of technology. It is a growth sector, and yet we were having to consolidate our programs because of the cost of delivery of those programs.

We have been able, in spite of the funding decrease, to develop seven new programs in the last 10 years. Our enrolment has increased at this college by 7%. We have five new programs planned for the fall of 2001, in spite of the fact that we're getting no new funding for new programs. So the theory of us doing more for less is really true, but we're on the verge of no longer being able to do that. I think we've arrived at the stage of no longer being able to do more with less.

We talked earlier about the fact that the funding to colleges has been decreased by 39.9%. Interestingly enough, our full-time faculty ratio is down 39% in the last 10 years. Our full-time administration is down by 35%, full-time support staff is down by 26%, and we have lost 33% of our workforce since 1992. So it's interesting that the funding was decreased by 39.9% while our staffing has decreased by a third at the same time.

I want to speak about one of the trends that you're going to be hearing more and more about, and that is the trend toward e-learning. Confederation College has been at the forefront of alternative delivery for years. We have been servicing the six communities that we serve, that large land mass, through audio conferencing and video conferencing. The shift now is into e-learning. I'm sure you're going to be hearing at the government tables as the presentations come forward about the Ontario Knowledge Network for Learning. I know they are asking for funding. The Ontario Knowledge Network for Learning is a very critical part of our ability to be successful within our catchment areas and I would ask that you give it due consideration and support as well.

You do hear about the great digital divide. When that terminology is used, it is usually based on economic lines. I am discovering in northwestern Ontario that the great digital divide does not only apply from an economic perspective but is also a geographic issue. We do not have the infrastructure in place to provide e-learning. I can ship a course to China faster and easier than I can ship it within my catchment area using technology. That's the kind of change that we need to see happen within our province. In terms of the need to shift to be able to offer courses through e-learning, it will make us a provider of that service as opposed to an importer of that service. I think that's an important role that we have to play as educators.

In terms of the recommendations that I would like you to consider as they apply to funding, obviously we need to increase the funding levels for colleges. Also, the aboriginal funding needs to be increased. If there were any way to sign an agreement between the province and the feds for HRDC training, that would be wonderful. Obviously, supporting the telecommunications infrastructure in northwestern Ontario is critical, as well as support for the Ontario Knowledge Network for Learning report that I assume you've already seen.

In terms of some of the specific details related to that, increasing the funding level, what is a fair funding level for a student? That needs to be determined. I would ask as well that you examine the funding in other provinces. For example, a small college in Alberta right now gets between $6,000 and $12,000 per student. Our operating grant per student, on average, is $3,750.

We would ask that we start by returning to the 1994-95 transfer levels and that we fund the actual growth in enrolment. We are continuing to grow and yet the funding is not increasing. Interestingly enough, with all of the salary settlements that occurred provincially within the last two years, the cost of those increases has increased our costs of delivery by 12%. So we're operating at a time when our enrolment has increased by 35%, our operating funds have decreased by 39%, and, in the last couple of years, our salaries have increased by 12% across the board. Those are significant changes for us to be able to manage on that decreased funding.

We're also asking you to consider an increase in the targeted funding that is made available. There has been a submission made by the Association of Colleges of Applied Arts and Technology of Ontario, and we support and endorse their requests for funding. One of the requests that they've put on the board is to create an educational technology fund so that we can deliver e-learning courses. As a province, they're asking for $40 million, and Confederation's share of that would be $1.1 million.

Institutional equipment is critical. Inasmuch as our operating funds have decreased, so have the funds for our equipment. We talked about our technology programs. You all know the price of computers. All of those costs continue to escalate, and we need to be able to fund that aspect of our delivery as well.

We're also asking that the key performance funding be increased funding as opposed to part of our regular funding. The province is asking for a $28-million increase in that, and the amount for Confederation College, if that were done on a pro rata basis, would be $750,000.

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Faculty renewal is an important element and you're starting to see that in the paper, particularly as it applies to universities. It also applies to colleges. Professional development budgets have been slashed throughout the years, and we need to ensure that our faculty remain current and relevant. Faculty renewal is critical. We're asking for the ATOP funding to be maintained this year at the same level it was last year and the amount for Confederation College out of that would be $680,000.

In terms of the aboriginal funding that I mentioned earlier, Confederation has the largest body of aboriginal students for all colleges in Ontario. The population in northwestern Ontario that is aboriginal is 18%. We need to be able to better serve these clients and we're not able to do it with our current funding. We would request a larger share of the special purpose funding for aboriginal programming so that we can continue to work with our aboriginal communities to meet their needs for learning.

We are also requesting that there be a signed agreement between the feds and the province related to training. When the college system was created in the late 1960s and well into the 1990s, the funding for all of our regional campuses came as a result of the agreement between the federal government and the provincial government. That funding has virtually been eliminated and this has had a major impact on what we are able to deliver within our catchment area. We would ask that that be revisited and, hopefully, signed.

We talked about improving the telecommunications infrastructure in northwestern Ontario. I know it's hard to believe that we live in a part of the province where the electronic highway does not connect to the other, but that is true in northwestern Ontario. The bandwidth, for example, to access a T1 line in Thunder Bay is four times its cost in Toronto. The farther away you go from Thunder Bay, the more expensive it is. I was meeting yesterday with some of my colleagues from the boards of education in northwestern Ontario, and their costs are 14 times what it is to access bandwidth in southern Ontario. Those are costs that need to be considered. The T1 access is not available throughout our entire region and, obviously, for us to be able to meet those learning needs, you need to be able to access that kind of delivery.

In terms of a summary, as I said earlier, education and training are critical in northwestern Ontario, and the role the college plays in that is vital. We have faced the revenue declines over the past years and we've gone through what that looks like. However, we really believe that support for our colleges is critical. We often talk about the fact that the two things that separate a Third World country from a First World country are the quality of education and the quality of health. I'm concerned that we're on the verge of creating a Third World education system unless we start to fund it.

I am certainly open to questions and comments. I know my colleague Dave Ramsey would like to make a few comments as well.

The Chair: Go ahead.

Mr David Ramsey: Good morning. Just as a quick survey, how many people here have had children?

Mr Gerry Phillips (Scarborough-Agincourt): My wife has.

Mr Ramsey: The reason I asked that question is that, as an employee of the college system for the last 25 years in my capacity as a faculty member, and now in the latter five years as a counsellor, I come in contact with students who value coming to school. But my frustration as a faculty member has increased over the years because the ability for faculty members to treat students as they should be treated-uniquely, with attentiveness and with all sorts of extra help-has gradually diminished. As Pat has indicated, the numbers of students have increased and the number of people available to assist them has correspondingly decreased.

My experience in the classroom is such that some of our students-many of our students at times, given the year-don't always readily grasp the issues they have to deal with. So taking time to speak with them individually, giving them opportunities to perhaps do supplementary assignments, that's done in order to ensure that they're successful. That's always been, I think, the objective that my colleagues on faculty have had: to help the students be the best that they can be.

But we can't expect that that will happen for all of the students. Some students can come in the classroom, can readily follow the directions, can readily be successful in any assignment they're given. There are other students who need some extra help, and quite frankly, as a parent, as a citizen of Ontario, it concerns me greatly when I can't give all of the time that I feel these students need, because they're our investment for the future, as we all know. Although that may become a bromide these days, the reality is that these young people are our future.

As a counsellor I know there are many students who either have to leave school early or who can't be as successful in school as they would like to be because they've had to take more than one part-time job in order to meet their financial commitments. As Pat has suggested, the increase in tuitions has greatly burdened many students. The number of students who now need a student loan is significant, and a student loan, unfortunately, is often inadequate to meet students' needs while they're at school. So they have to take part-time jobs, and oftentimes they have to take more than one part-time job. Quite frankly, the demands we place on our students are high. We expect them to be able to cope with the academic standards that we've set, but we're frustrated when we see good students fall by the wayside because in order for them to survive economically they can't give all of their attention to their main job, which is their education.

As you may be familiar with, there have been two significant reports in Ontario on post-secondary education in the college system. The first one was done in 1985 and the second one was in 1996. The Ministry of Education, in 1996, said very clearly that if resources, mainly dollars, were not going to flow into the system, there would be negative impacts on access and on quality. The report that I've given you today, Voices From the Classroom, was commissioned and completed in November 1999. The main point of this document was to survey faculty across our 25 colleges. There were 517 faculty and counsellors who were surveyed, and they were asked questions as to what was happening from their vantage point on the front lines. This report very clearly indicates that the prediction that was made in 1996 by the Ministry of Education report, that if resources were not forthcoming, serious compromises would occur to the quality of education, has unfortunately come true. I want to hit just two points from this report, and I hope, if you have an opportunity, you will look at the summary because there are other good things in this report. But there are two things that my colleagues have said across the system.

First of all, they said they are dismayed and they are frustrated that the potential for dialogue and interaction between the teacher and the student in the class and after class has been seriously diminished, and it's been diminished because there have been more students whom each faculty member has had to have responsibility for because there is less faculty and there are more students in our system. Anyone who's ever had the opportunity to try to teach something to someone else knows that it's not just the material, it's the way you convey that material that is so important. And it's the relationship that's established between the person who's trying to convey the material to the person who is the learner.

When I was a faculty member, when I started at the college 25 years ago, I had the benefit and the opportunities not only to know each of my students by name and know of their personal situations, know their strengths and weaknesses, but I also had opportunities outside of the classroom time to individually tutor them, to meet with them, to give them mentoring on their projects. That, sadly, has gone by the wayside very seriously right across the Ontario college system.

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The second point this report reveals is that the types of evaluations and assignments that are now given by my colleagues are not of the same quality that they once were. Many of my colleagues used to give essays and projects. These were huge undertakings, and many hours were spent reviewing them and helping the students come up with the results they needed to be successful. Because of the increasing numbers of students, because of the fewer numbers of colleagues, many faculty have now had to resort to multiple-choice evaluations. This is a very serious situation, because it leads to not only a uniform method of evaluation that, for some students, is not a fair way to assess what they really know; in fact, some students cannot perform well on multiple-choice testing. But, secondly, it robs the student of the opportunity to have a holistic evaluation. I would mark the grammar, I would mark the spelling, I would mark the thought process that was present in projects. But that cannot be done on a multiple-choice test, and I think that's a serious deficiency. I mourn the loss that this means for our students who are graduating today.

I know demands for money are always high. I know priorities are difficult to set. But I would ask you, in your deliberations, to please keep in the forefront that when we're talking about education, we are talking about an investment in the future of our community. We want, all of us, to have an accessible education system, one that doesn't have barriers because of increasing tuition fees-and that does produce barriers. We want to ensure that our education system is healthy so that people are not burning out in the ability to do the work that they want to do, the kind of quality things that are involved in the interaction between students and their faculty members.

Thank you for this opportunity. As Pat says, we'll certainly entertain any questions that you have.

The Chair: We've basically run out of time, but I'm going to be fair: I'm going to allow each caucus two minutes for a question. I'll start with the official opposition.

Mr Phillips: First, if I might make a comment, congratulations to the community colleges. I think they have a terrific reputation. I live in Scarborough, and Centennial has a fabulous reputation there. You're doing great work, and I think everybody recognizes it. My congratulations. By the way, I don't have time, but you may want to read the government's own document on why you should invest in Ontario. It talks about "Ontario's highly accessible system of 25 community colleges" and "substantial reputation among employers," blah, blah, blah. It goes on to say, "Despite its massive commitment to education and training historically, Ontario is increasing its investment." That's what they're saying; the facts are a little bit different, as you point out.

Here's the challenge for us, and that is that the government has committed to substantial tax cuts. We're heading into a period of an economic downturn-hopefully not a recession, but a downturn. So that is going to be a big claim on it. The government said that health care costs will increase by 5%. They've said they'll meet those needs. In spite of what we in the opposition will say, the NDP and ourselves, yesterday the Toronto-Dominion Bank pointed out that while the US states are increasing their investment, Ontario is decreasing its investment. There is not the public cry that there should be in this area. I guess I'm looking for advice from the colleges. How can we mobilize more public support for the cause? That will be necessary to actually make this happen, because the opposition has a relatively limited influence on the government, tragically.

Ms Lang: That's an interesting question. Part of the dilemma in responding to the need to make this a public issue is if there were some way for us to resolve the issue without it being a public issue, that would be the direction I would prefer to choose. The reason I say that is I don't want the public to lose confidence in the system that we offer. So we've been trying to keep this debate out of the public realm and off the front of the newspapers for that very reason. Maybe what you're telling us is we need to rethink that and maybe through ACAATO and provincially we need to start to be on the front page of all the newspapers and get that message out. But our approach has been to try to keep that off the front page because we don't want the families and the students to be concerned about the quality of their education.

The other challenge we're going to face is that when there is a downturn in the economy, guess what students do? They go back to school. So as the economy goes down, the enrolments in community colleges increase. That's a trend we've seen unfold over the years and I would think we're going to continue to see that. So we're going to be hit again.

Mr Christopherson: Thank you both for your presentation. Like Mr Phillips, I'm lucky to have a prestigious community college in my riding, as part of my new expanded riding, Mohawk College. I'm sure you know Catherine Rellinger. We're very proud of the coordination.

You didn't get a chance to talk on, and if you get a second I wouldn't mind hearing just a little comment about-I know we're tough for time, Chair. In Hamilton, McMaster University and Mohawk College-and I happen to represent both-have been working diligently under Keith McIntyre, who played a key role in making that happen, in trying to have more co-operation, coordination and fluidity in terms of the students' educational career between the two institutions. I think that's giving us some real advantages. I'd be interested to hear whether you have a similar relationship happening.

I'm just going to get all mine out, David, because the Chair's going to shut me down at any moment and I want to try to get as much as I can out.

Ms Lang: He knows you well.

Mr Christopherson: Oh, yes.

I also was very impressed by the fact that-I guess this is directed toward you, Pat-you have both union representation and board of governors representation here making your submission. I think no matter who the party is in power, that always tends to have a stronger impact on us, because you're speaking with one voice. It's obvious why that works on us.

I also wanted to mention that it's a shame we can't see the government seeing the benefits of investing-not spending per se, but investing-money in our post-secondary education system, as easily as they do in, say, the mining industry, which was just in here a little while ago. They're all for that-"Yes, it's a great investment; that's going to help out"-but somehow they don't seem to see the same equation. As Gerry mentioned earlier, we had the TD Bank. I've raised this whenever we get an education submission, because I think it's terrific that the chief economist with the TD Bank, in his presentation, took two of the charts he presented to us and spoke in a business context about the concern they have for the declining investment in post-secondary education. You may want to get a copy of that or be aware that you have an ally in the bankers. That usually comes as a surprise to all of us when it happens.

The last thing is the point you ended on just now about increased enrolment. Am I hearing you say that you have some concern that if we have the same kind of trend and we get into a bit of a longer downturn, you may not be able to meet that demand, thereby denying a whole lot of people who are looking at this as their hope for the future being shut off from it, and where else do they go if the jobs aren't there and they can't get into community colleges? I would suggest maybe the same thing is happening at the university level.

Ms Lang: I'll answer your three questions. The first one is in terms of our relationship with Lakehead. Yes, we do have a very positive working relationship with Lakehead, and the two presidents have just decided that we're going to create a blue-ribbon panel to take a look at what kind of opportunities we can create to create a greater seamlessness and a greater transferability and accessibility between our two institutions. That will be unfolding within the very next period of time.

In terms of my colleagues being here with me today, I did want to tell you our students were due to come with us as well. Unfortunately, it's election time and I know each and every one of you understands what it means when it's election time. They called and apologized at the very last moment, but they needed to do some electioneering. So there they are; they would have been here as well.

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In terms of the impact on enrolment, not only will we see an increase in enrolment when we see a flattening of the economy, but we are also getting prepared for the double cohort. My colleagues, the directors of the boards of education in northwestern Ontario, said yesterday that it's not going to be a double cohort; it's going to be a quadruple cohort because of the number of students they have who are fast-tracking through high school to get ahead of the double cohort.

Mr Christopherson: I don't blame them.

Ms Lang: So I think it's going to be a bigger issue than just the double that they're predicting. I think we are going to be affected by that.

The Chair: Thank you very much.

Mr John O'Toole (Durham): It's Pat and David, is it?

Mr Ramsey: Yes.

Mr O'Toole: It's a pleasure. To answer a couple of your questions, I have five children, all of whom have gone to university. In fact, one did a graduate degree here at Lakehead. As a parent of five children, the $40,000 debt load is unimaginable to me. How someone could do that would perhaps be an argument in itself. I could say that if any of mine ever accumulated-we're just average people, and I'd be depressed that their future didn't look very good in terms of money management.

I am also very proud to have Durham College in my riding. It's a wonderful facility. In fact, Gary Polonsky is from here. He's a wonderful guy and a great initiator, if you will. He is very much pushing what he would call the applied degree status for the colleges, and perhaps you could respond to that.

More importantly, I recognize the job you're doing under difficult circumstances. Certainly a geography the size of France is pictorially easy to understand. I think that e-education, as you called it, is a solution that has to be there, not just for you but for the whole issue of access and affordability. It's certainly one of the solutions-not the only one. The socialization part of it, the contact, is extremely important, and I understand that.

The Ontario Knowledge Network is moving forward, and you talked about contact learning, is it? Is that the program?

Ms Lang: Contact North.

Mr O'Toole: You talked about some of the digital divide infrastructure questions. Hopefully, they are being addressed. I know that under Minister Wilson that whole access question is paramount in the Ministry of Energy, Science and Technology. In your response you could probably give me some response to that as well.

On the funding-I am quite interested in the double cohort, the increasing enrolment issues-would you like to see tuition tied directly on a per student basis, where it's a per student and not a course load issue? If there was funding, we'd tie it directly to students. As you know, the KPIs, the outcomes, the key performance indicators are absolutely critical in the new funding piece. Not everybody can be teaching hairdressing at every college just to fill courses.

I want to admit that the government has made a significant commitment, as you know, through SuperBuild. That SuperBuild commitment, in capital, is $286 million. I think that funding will eventually follow up with operational funding.

The Chair: Mr O'Toole, you're going to have to wrap up your question.

Mr O'Toole: I just want to make sure there is one fund you are involved in: the strategic skills investment fund. In my understanding, with the global entrepreneur and electronics commerce course you offer, you are a recipient of funding under the SSI fund.

I appreciate your being here. I appreciate the job you are doing. As parents and taxpayers, we certainly want to help make sure you are able to deliver quality education in the future. I appreciate your plea to us this morning.

Ms Lang: Thank you. In terms of the student debt load, what I will do, if you give me your business card, is get information to you on the student debt load. It is very real and I think we need to be cognizant of that, so I will get you that information.

One of the questions you had was around the infrastructure that needs to be built. The one caution I would have for the government is: education is asking for an infrastructure, telehealth is asking for an infrastructure, the municipalities are asking for it, and I have a concern that we're not going to coordinate all of that and we're all going to be asking for the same thing and somehow we're going to overspend in one area and underspend in another. So I ask that there be a concerted effort around that across all ministries and across disciplines.

Your other question was with regard to-I'm having a senior moment.

Mr O'Toole: The access and some of the technical difficulties, your bandwidth and that. Are you able to deliver distributed learning? It sounds like you are.

Ms Lang: We are, but only to our campuses.

Mr O'Toole: It's not at the home.

Ms Lang: It's not at the home, because the access lines are not there.

I do appreciate the special funding the government has provided. We were not only given money under the SPI fund but also under SuperBuild. We were given $3.9 million for that. That is wonderful and we truly appreciate and value that and will use it wisely. The challenge is that it is not operating, and we need both. So we're going to have a building and we won't have the operating funds.

The Chair: With that, I have to bring the discussion to an end. On behalf of the committee, thank you very much for your presentation this afternoon.

Mr Ramsey: I would like to say just one word, if I may, Mr Chairman.

The Chair: You certainly may.

Mr Ramsey: A question was asked about collaboration. I am glad to hear Pat say that a committee is established, but as a faculty we are deeply disappointed that, where every other college has managed to make arrangements with a university with the same kind of qualifications as our nursing faculty, the collaborative arrangements between our two nursing faculties have not been successful here. We are hoping we can have some sort of mediation to assist in this process, because it will gravely affect students in this community who wish to be educated here, and we feel we have a responsibility to those students to make this program accessible to them.

One last comment, if I may, about the advocacy issue. I think it's your responsibility as leaders to ensure there is equitable funding for all three public services, whether it's health, education or social welfare, because these are the tripods that our society rests upon. If one of those legs is missing, we are going to have significant difficulties in this society. I hope that you will, in your wisdom, ensure there is equitable funding for all three serious public services.

The Chair: One announcement: the shuttle bus for the airport will be leaving at 6 o'clock in front of the hotel, so let's be on time.

Mr Christopherson: Will the room be secured during the lunch break?

The Chair: We'll make sure it is.

The committee is adjourned until 1:30.

The committee recessed from 1208 to 1326.

THUNDER BAY TRANSPORTATION AND INDUSTRY COMMITTEE

The Chair: Good afternoon, everyone. If I can get your attention, I'd like to bring this committee back to order.

Our first presenters this afternoon are representatives from the Thunder Bay Transportation and Industry Committee, if you could please come forward and state your names for the record. On behalf of the committee, welcome. You have 30 minutes for your presentation this afternoon.

Mr Jim Pretchuk: Thank you very much. My name is Jim Pretchuk. I am the treasurer of this transportation and industry committee. I presently have been the chair of the National Transportation Week committee in Thunder Bay for the last six years and sit on the chamber of commerce transportation committee and get paid by Consolidated Fastfrate.

Mr Hartley Multamaki: Thank you very much. My name is Hartley Multamaki. I'm the vice-president of planning and development for the Buchanan Group of Companies, and I also sit on this transportation and industry committee as one of the industrial representatives, basically representing a part of the heavy industries that are in Thunder Bay and the region.

To give you a bit of background on the Thunder Bay Transportation and Industry Committee, it has been around for a number of years now and it represents over 30 of the major transportation and heavy industrial companies in Thunder Bay and throughout northwestern Ontario. That's a range of everybody from very small trucking companies through to major multinational organizations, from the one and two employees up to the several thousand, 4,000, 5,000, 6,000-plus employees. So we do have a broad base of representation. We are very committed and knowledgeable in the transportation end of the industry. We're hoping we can bring some valuable points for consideration to your deliberations.

We're going to try to limit this to about 15 or 20 minutes, the presentation part, because we're quite prepared to answer questions and we think it's very valuable that you have the opportunity to ask us. There may be some members in the crowd as well who are with us, by the way.

The first issue we wanted to talk about was the load restriction issue. This is the half-loads issue on secondary highways in northwestern Ontario. It applies throughout northern Ontario but particularly in northwestern Ontario, which affects the city of Thunder Bay and the surrounding area.

There was a recent change in legislation that moved the load restriction date back from March 1 to February 15. That's a huge fundamental change in how the Ministry of Transportation does business, and the rationale behind that of course is that you place half-loads or load restrictions on heavy trucks to limit the amount of damage to secondary highways during the spring breakup period. I guess the thinking on it is that we are experiencing some difficult weather patterns; warming up is happening much earlier. I'm not sure that we necessarily buy the fact that suddenly global warming has hit and the spring thaw has moved 15 days earlier into February. I think that's something that is more of a long-term issue than a four-month or six-month issue. However, the impact of load restrictions on the resource-based industries, particularly the pulp and paper industry, the sawmilling industry and the wood-using industries, is huge.

Really, the issue there is that the forest-products industries start cutting winter wood down in the swamps about January 1. We have basically six weeks to cut, skid to roadside, process, load on to trucks and haul that wood to the mills to build up enough inventory for five to six months' worth of operation. That's assuming that this date of February 15 is enforced. In the past, it has always gone into March 15, maybe March 2, March 3.

To put it into perspective, that additional 15 days will mean that the forest-products industry in northern Ontario could potentially have to move an additional 30,000 loads in those 15 days, and I don't believe it can be done and I don't think any of my colleagues believe that can be done. The vehicles simply aren't out there, and the ability to harvest wood that quickly isn't out there. So it has the potential to have a huge impact on the resource-based industries in northwestern Ontario.

Also, to try to put it into perspective, the city of Thunder Bay sees approximately $2.8 billion worth of forest products flow through this city, all of it over the Queen's highways, and any change in those dates has the potential to impact on that.

I'd also like to point out as well that there is a huge amount of crown revenue that's involved in the resource-based industries in the form of stumpage. The forest-products industries pay a large amount of money to the province of Ontario for stumpage. If we don't move that wood, the stumpage doesn't get paid and it doesn't get collected. Also, there's personal income tax, corporate income tax and fuel taxes. I understand that there are going to be other groups that are going to come forward with this discussion of the issue of fuel taxes and how it affects industry. That's a problem for us as well, but I won't dwell on it here because I understand it will be dealt with by other groups.

I want to leave you with the understanding that this change in load restrictions on highways, first of all, is a huge issue for us and needs to be addressed; and second, with the thought that the simple solution of course to it is to upgrade our secondary highways to a standard whereby there's no necessity for putting on load restrictions. It is a monetary issue. Upgrading highways is very expensive, but I think the payoff in the intermediate to long term is certainly there. It allows us to operate 12 months of the year on the highways and not have to carry huge inventories, and in this case we may not even be able to build the inventories to keep our operations going.

The other issue I'd like to bring your attention to is the recent turnover in the last decade of a number of highways to local municipalities, towns, cities and whatnot. There are a number of roadways out there that have been turned over, and there have been indications that some of the local communities would like to place load restrictions, ie, move heavy truck traffic off these undesignated or redesignated highways. That again is a huge problem for the transportation industry and the heavy industries that rely on truck transport, because it means that in some cases there is limited or inappropriate access to the industrial facilities. An example of this is the main road through Greenstone, the old community of Geraldton. There have been discussions of closures on that road. It is the only highway to the latest and newest sawmill, which was an investment of $50 million to $100 million, which would be in jeopardy if that were the case. It's the same thing with highways like Highway 102, which is Dawson Road coming into the city of Thunder Bay. The Trans-Canada traffic relies on that basically from Vancouver to Toronto. It is part of the Trans-Canada traffic. Also, the local industry relies very heavily on Highway 102.

I think we'd like to leave you with this thought: there should be a dedication of highway traffic corridors and some mechanism for ensuring that these are protected and that industry can make multi-million dollar investments and be able to count on the fact that those traffic corridors will in fact remain available to them on a permanent basis.

Finally, I'd like to touch on the issue of dedicated funding. I think all of the issues we've discussed so far really rely on having dedicated funds to deliver on the programs, things like upgrading the highways. Obviously it takes a fair bit of money to bring a secondary highway to a primary highway status and eliminate the need for half loads, and it obviously takes dedicated funding to deal with some of these municipal type issues with load restrictions and road closures. The obvious solution to the Highway 102 problem, of course, is to construct the Shabaqua bypass, which would eliminate most of the need for Highway 102 to remain open. We are suggesting that there are various avenues available, things like the SuperBuild fund, things like the northern Ontario heritage fund. They have been very helpful in the past, and our organization strongly supports the continuation of these funding sources and perhaps the dedication of portions of those sources of funding to transportation issues.

At this time that's all I really had to say, but if there are any questions, we'd be pleased to address them.

The Chair: Thank you very much. We have 15 minutes, approximately five minutes per caucus.

Mr Christopherson: Thank you very much for your presentation. I have to say that one of the benefits of travel is that it gives you a new opportunity to have a different first impression when somebody throws something out at you. For instance, if you talked about transportation problems to most of us while we were back at Queen's Park, the first thing you think of is of course gridlock in and around the GTA, which is a real problem even for your industry. But if you're from the north, this is likely to be the first thing you think of. So I just want to say to everybody that it does underscore the importance of getting around. As much as it's not always convenient, it does seem to be important.

I just wanted to talk to you about the communities that have responsibility now for the highways. I'm a former municipal councillor, so I understand sort of looking at the world from that point of view. Are these areas where there were traditionally problems anyway even when the province still had control over those highways, that there were still these concerns being raised in these communities, or did something change besides just responsibility?

Mr Multamaki: It really depends on the individual situation. I don't believe, from my conversations with other people within the industry throughout the province, that this is an isolated instance in northwestern Ontario. It's occurring in a number of locations, from what I can tell. I think it is on an individual basis. It depends on the history of each individual highway or road that MTO previously had responsibility for and that was turned over to the municipalities.

It appears to me that it is somewhat of a standard problem that's combined with things like municipal planning processes and zoning changes and so on. But over time, what has tended to happen with these transportation corridors is that they start off as a main highway, and as the community grows it tends to place what we would consider somewhat inappropriate uses adjacent to the highway, such as residential, schools and so on, without the appropriate setbacks or the appropriate planning. Over time, it gets to the point where people start to complain that there is in fact heavy truck traffic on the highway. Also, there are a whole bunch of things like increased traffic as the economy picks up and so on, and as the community grows. So there are a whole bunch of contributing factors to this issue.

At the end of the day, as long as it was under the control of the province, it was always recognized that there would be heavy traffic on the highway itself and there was really nothing anybody could do about it; it's got a long history of that and there's a lot of investment on it and, no, we will not change the fact that it's a designated highway and there are trucks on it. Once the province relinquishes control over some of these critical highways, then the local decision-making takes over.

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Mr Christopherson: Then you can do something about it.

Mr Multamaki: That's right. Then you can actually do something to address these situations. There has been the intent to do that in some locations, which is a huge problem because industry does make investments based on the fact that you have the free flow of goods and products.

Mr Christopherson: I wouldn't question that at all.

The other side of it is that regardless of whether it was poor planning or not, if you've got trucks rumbling in front of your house or in front of the daycare centre or school, it's going to add to your concern, especially if you're new to the community and don't know the evolution of it.

Mr Multamaki: Absolutely.

Mr Christopherson: Assuming that it's one of those where you don't have an easy, "You're right; you're wrong," because anybody can do those-we tend to get the ones where, "They're right and they're right," and now what do you do? Let's just assume for the sake of argument that you've got situations where the communities have a legitimate concern that they've raised. Certainly I don't think anybody at this table would argue that you haven't raised legitimate concerns. What do you do? Are there any other win-win solutions, or do they cost money? If you're going to build detours around each of these-

Mr Pretchuk: It costs huge dollars. You're absolutely right. As a community, as a taxpayer, as a business owner, runner, we don't believe in spending money needlessly. Some of the solutions are dreams. I don't want to get rid of anybody's dreams, but let's face it, some of them are dreams. So what we're asking for is just some firm legislation in place and then to have them looked at so that we don't have to get bogged down with what in most cases is pretty obvious: you just do not change a Queen's highway without building a massive, multi-million dollar alternative.

Mr Christopherson: But again, you can appreciate the council's concern that, number one, they are getting pressure from their constituents and there are perhaps in some cases legitimate health or safety concerns, and to just take a blanket provincial law that says, "No consideration whatsoever. It is and it shall forever be," may be a little bit short-sighted. I'm saying there's no easy answer here.

Mr Pretchuk: You're right. We agree with that. Again, every community would be different. If there are alternates, everybody should work together to do it. If there aren't, then we don't want to have a situation where you're sweeping your dirt under your neighbour's doormat, and in some cases that's what it is. It is a municipal concern, and I think the municipality should just somehow put an end to those-

Mr Christopherson: You can see why they get upset, though, because they're paying the freight. They're maintaining it, they're responsible, and now they are going to accept this problem that they don't have to any more. Why should they?

Mr Multamaki: I think, though, there are some legitimate ways of at least addressing some of these situations. For example, yes, the municipality does take over the costs of having traffic on that particular piece of ground, but in exchange for that they also collect taxes from the industry that is using that. There may be the opportunity, for example, through provincial transfer payments to the municipality, for something with respect to the fuel tax. I don't know that-

Mr Christopherson: Don't hold your breath.

Mr Multamaki: I understand there may be some challenges there, but that is the sort of thing. In the past there has been compensation in most of these cases from the province to the municipality to take it over.

Mr Christopherson: The council would still benefit when the province owned it, and they didn't have to pay the bill.

Mr Multamaki: Yes, but they also received a payment in most cases when they accepted responsibility for that.

Mr Christopherson: The whole downloading thing is a big-there's not total agreement.

Mr Multamaki: It is an issue, and I don't think it's necessary for us to get into that. I think there are other things as an industry as well that we are obligated and we have a responsibility to do as well in this situation. I'm not sitting here telling you, as heavy industry and as the transportation industry, that we don't have some obligations as well. If it's a health and safety issue, if it's a speeding issue, if it's a noise issue, we have an obligation to the people of Ontario and the people in the community to deal with that as best we can. Part of the mandate of our committee is to look at each of these situations, and we have zero tolerance for things like that.

Mr Christopherson: But you can't do that-if you're not able to take care of your business, you can't do those things either.

Mr Multamaki: I see it as part of our business.

The Chair: With that, I have to go to the government side. We've run out of time. Mr Galt.

Mr Galt: Thanks for your presentation. I think I remember, either with this one or the presentation of the Task Force on Rural Economic Renewal, the talk about the half-load issue.

Can we explore that just for a few minutes? You're concerned about the date changing. I can understand that. There must be ways of predicting when the roads are going to be in this condition.

As a kid driving a tractor on the farm, in the morning you could go across a ploughed field, and in the afternoon you'd get stuck just because of some frost on the ground. I would think on a highway there's a certain amount of frost that's going to carry a vehicle fully loaded versus a day once it starts to thaw out. Meteorologically, can this not be predicted?

Mr Multamaki: Yes. Other jurisdictions are using a number of different techniques and technical methods for determining when half-loads should go on, from a meteorological perspective. One, obviously, is frost probes, where you install frost probes in these highways that are subject to load restrictions. Based on the amount of frost in the road base, you place the load restrictions.

There's a certain amount of art involved in that science as well, because every road base is not exactly the same, but it does give you a fairly reasonable estimate of the amount of frost and the loads that could be carried on it. We certainly support the use of technical assistance and tools of that nature to help in the decision-making.

Mr Galt: Now, the technology is there to say, "Today it's safe and tomorrow it's not," or vice versa, and I expect pre-February 15 there's probably the odd day that you shouldn't have that big a load on; I don't know, but possibly. How do you get the message out and how do you police it? Is this something that could be handled on the weather channel? How would truckers be informed? Would there be an 800 number to dial into? There is policing and you don't want them out on a day when it's really going to wreck the roads. You want to be able to say, by law, if somebody's stopped with a full load and it's going to stand up in court, that they're doing something they shouldn't be.

Mr Multamaki: Yes, there certainly is the legal perspective on that. I think the reality, though, is that on roads that are half-loaded, there is signage on them. When the signs are up, you cannot travel on it. When the signs are down, then you would be able to.

In the past we have always supported what we call "bagging." You bag the signs when it's suitable to travel on it with full loads. You take the bags off the signs so that the signs say the half-loads are in effect and you go ahead.

It's very easy to inform the trucking industry that this is the way the system works. Certainly, there is a variety of methods that could be used, whether it's a call-in number or it's a contact number or whatever. We're in an age where technology is very good for that. It may be just an e-mailing list that comes out and every morning the transportation managers check that list or phone that number or are phoned by that number and know whether or not the road they're interested in is available.

Mr Pretchuk: But that's not happening right now. The important thing is that everybody understands what's happening now is that a news release is put out prior to the half-loads. It's in stone, more or less.

Mr Multamaki: That's right. Where it goes up, it goes up.

Mr Pretchuk: That's the problem, because what will happen is, let's say the 15th was half-loads, and along came the 15th and it was freezing cold and it was cold for another three or four weeks. We want to see something that can happen very quickly, at least addressing some of these ideas with the technology we have, an 800 number etc, where the ministry will show the flexibility. Right now, that's where our concern is: OK, once it's said, it's done and that's the end of it.

The Chair: We have to go to the official opposition. Mr Kwinter.

Mr Kwinter: Yes, I'd like just to follow up on that because I have the same concerns. Is this new legislation mandated that on February 15 half-loads go into effect regardless of the weather?

Mr Multamaki: No, it's not mandated, but it allows MTO to put the half-loads on as early as February 15. It does not allow MTO to put them on prior to February 15.

Mr Kwinter: And once it's on, it can be taken off if the weather allows it.

Mr Multamaki: Not very easily. I'm not sure of the legislation on it. This is the bagging issue, where they can bag the sign. It appears to be a very, very difficult process. I don't believe it's a legislative process. I believe it's the policy, procedure and internal workings of MTO that prevent them from easily reopening a road once it's on, because there's a 30-day public notification process that goes into the paper, and it's this whole policy and procedure on notice that appears to be the hang-up with MTO.

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Mr Kwinter: Just so I understand it, there is the flexibility that they don't have to commence the half loads on February 5. They can, but they don't have to. But you're saying that once they do-for example, if there's a really cold spell on February 15, they could postpone it until they think the conditions warrant it, and then, once that happens, it's difficult to take it off.

Mr Multamaki: In fact, right now, half loads could be on every highway in northern Ontario. It is after February 15 right now. The problem for industry is that we can't plan for a March 1 deadline to build our inventories in the mills if we know that the ability to put half loads on comes on February 15. We can only plan on February 15, because it can occur that early. We have to make sure we have the inventory in the yards to keep our mills running prior to February 15. We can't say, well, the weather might be cold until March 1, so we'll plan to move all that wood up to March 1. We now have to have every stick of wood that we need to carry us through till about June 15 in the millyards by February 15, and we don't start cutting in the swamps until January 1.

Mr Kwinter: Does this issue only pertain to the forestry industry?

Mr Multamaki: It's primarily a forest industry problem or concern, but also for the mining industry, who move heavy equipment and that sort of thing, drill rigs and so on. It does impact them to a certain degree as well, and it also to a certain degree affects some of the highway haulers who are hauling into places like Armstrong, Aroland-

Mr Galt: Pickle Lake.

Mr Multamaki: Pickle Lake, yes. So it is an issue for the trucking industry in general, but primarily for the forest products industry. By the same token, the forest products industry is the bulk of the industry in northern Ontario.

Mr Pretchuk: It literally doubles the cost.

Mr Phillips: Just to comment on that, I went out for a walk at noon, and there's no need for a half-load limit today.

Mr Pretchuk: Absolutely. You can make the decision.

Mr Phillips: I hope you can rest comfortably until tomorrow at least.

But my question is, what has led up to this? We've gone through a local services realignment; that's the term that's used. In my judgment, there's about $1 billion of capital that used to be spent on things transferred to municipalities that hasn't been accounted for, and I think municipalities are now starting to realize there were two parts of the downloading. One was the operating and the other was the capital, and in my opinion there is a $1-billion shortfall on the capital side.

I'm just trying to determine: have municipalities been encouraging the Ministry of Transportation to move this deadline up, or did the Ministry of Transportation simply decide that now they needed to move it for their own reasons?

Mr Multamaki: I do not believe the municipalities on secondary highways that are controlled by MTO are encouraging them at all; in fact, quite the contrary. It's not in a municipality's best interests to have half loads on the Queen's highways, where they pay none of the costs. The cost of highway maintenance is entirely the province's.

Mr Phillips: So this is purely on provincial highways, then? There's no municipality that's moving these load limits?

Mr Multamaki: That's right. There's another issue with municipalities. There's a whole number of municipal roads that are half-loaded by the municipalities themselves, but that's a separate issue. That's an issue we have to deal with directly with the municipalities.

Mr Phillips: And they have the right to determine those dates independently.

Mr Multamaki: Yes, they do.

Mr Pretchuk: They generally tend to follow the ministry.

Mr Multamaki: Yes, they do. They tend to follow the ministry. The other thing is that when MTO puts the half loads on, the municipalities tend to follow suit at the same time. If MTO puts the half loads on on February 15, like yesterday, a fair number of municipalities would probably look out the window and say it's not necessary, because they live in those communities and they realize that, for example, yesterday in Nakina it was -32ºC. It was raining in Toronto. Obviously, in Toronto you would want to put half loads on. In Nakina, you've still got at least a month before you would think about it. So it's a case of scope and geography and everything else with this half-loads issue. There's a huge difference in weather patterns within the province, even within northwestern Ontario. Fort Frances tends to break up and the roads tend to be in jeopardy much earlier than they are on the Nungesser Road, which is 50 miles north of Red Lake.

The Chair: With that, we have to bring an end to the discussion. On behalf of the committee, thank you very much for your presentation this afternoon.

KINNA-AWEYA LEGAL CLINIC STEERING COMMITTEE ON SOCIAL ASSISTANCE

The Chair: Our next presenters are the Kinna-aweya representatives. On behalf of the committee, welcome. You have 30 minutes for your presentation this afternoon. If you could please state your name for the record also.

Ms Sarah Colquhoun: My name is Sarah Colquhoun. I'm a lawyer and the coordinator of legal services at the Kinna-aweya Legal Clinic in Thunder Bay. Kinna-aweya Legal Clinic is funded by Legal Aid Ontario to provide poverty law services to low-income people in the district of Thunder Bay.

I am also a northern clinics representative on the provincial Steering Committee on Social Assistance, which is an organization made up of legal clinic advocates from across the province, lawyers and community legal workers. Our mandate is to work toward systemic solutions for problems that our clients face with respect to the social assistance system, and that's what I would like to speak to you about this afternoon.

Our clients are people struggling to survive on social assistance in Ontario. Even for the other work that we do-for instance, at our clinic at Kinna-aweya more than half of our casework at present is with respect to disability appeals for the Ontario disability support program. We also do appeals for other income maintenance programs, tenancy work and other poverty law issues, but most of our clients are on social assistance. They're in receipt of either Ontario Works benefits or Ontario disability support program benefits, and that's how they support themselves and their families.

It's apparent to those of us who work with and talk to people on social assistance that the struggle to survive on the level of benefits that are available today in Ontario is a struggle that is becoming more and more desperate.

Social assistance recipients are not a vocal constituency. Because of the practical demonization of people receiving public assistance in recent years, many recipients are deeply ashamed that their circumstances have forced them to rely on welfare or disability benefits. I can't tell you the number of people who have sat in my office and said, "I know from reading the paper that people who are on social assistance are cheaters and liars and fakes, but I know that I'm honest and hard-working and I need those benefits." They have internalized the myths about social assistance recipients and they recognize that they don't meet those myths, but they still think that other people on social assistance do. They don't want to be identified as people on social assistance.

Most people who are struggling day to day to pay the rent and put food on the table do not have any energy left to be political. They are not in a position to speak publicly about the debilitating effects of trying to cope with too little money to pay for basic necessities. That's why the Steering Committee on Social Assistance has taken this opportunity to speak on behalf of our clients. Although some of us have experienced living in poverty, personally I have not, but I do have day-to-day experience of talking to people who are struggling with living in poverty. So we've taken this opportunity to speak on behalf of our clients and to urge this committee to recommend to the government an increase in social services spending in the coming budget.

We deal with lots of different issues related to social assistance at our office. We help people who've been cut off for various reasons: because they've been fired from a job because they were off sick or if they're not getting enough money because there is a deduction from their benefits for money they're not receiving. They're all sorts of issues that we deal with. In the past few years it's become increasingly clear to those of us who work with social assistance recipients that the primary issue for them is adequacy.

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No one chooses to be on social assistance. It is an income of last resort. It's the bottom of the safety net. It's where you go when you have no other choice. The program changes over the last five years have been extensive. They have tightened eligibility requirements to the extent that everyone recognizes that there are now people in need, who have no income or assets, who are not eligible for benefits. Everyone who is receiving benefits has been pre-screened and screened and has provided written verification to verify everything that needs to be verified, and they have been determined by the bureaucracy to be in need and eligible for benefits, yet the benefits that they receive are hopelessly inadequate.

The social assistance benefits available in Ontario through the Ontario Works program and the Ontario disability support program are not adequate to allow recipients to meet their basic needs. The amount that a single employable person receives is not enough to pay rent and buy food in most municipalities in Ontario, let alone pay for other necessities like clothing and transportation. It is not a matter of budgeting more carefully or being more wise in choices; it's a matter of there simply not being enough money to pay for everything that needs to be paid for. The amount of money that people receive is simply inadequate to meet their basic needs.

In 1995 the provincial government reduced social assistance rates by 22.6%. They stated that their aim was to set benefit rates at 10% above the average of the rates for other provinces. But the rates were set without any meaningful analysis of the cost of living in Ontario and whether the amounts provided would allow recipients to meet their basic needs.

That rate cut in 1995 was devastating for recipients. In the five years since the rate cut, despite steady increases in the cost of living, social assistance rates have not changed, leading to a further erosion of the value of benefits. The total decrease in the value of benefits since 1995 is 27% to 30%. That's a 30% decrease in the spending power of people whose benefits were already well below the poverty line. In real terms, welfare benefits at present are the lowest they have been for decades in Ontario. Welfare benefits have always been far below the poverty line; in the last five years they have been falling farther and farther below the poverty line.

There have been a number of reports written recently outlining the devastating impact of the reduction in welfare rates on families who rely on social assistance in Ontario. The Ontario Federation of Indian Friendship Centres commissioned a report, called Urban Aboriginal Child Poverty: A Status Report on Aboriginal Children and Their Families in Ontario, with heartbreaking stories from parents who can't provide the necessities of life for their children on social assistance. The Ontario Social Safety Network has produced a report called Five Years Later: Welfare Rate Cuts Anniversary Report. I've included the Web site www.welfarewatch.toronto.on.ca in my submission, where a copy of that report can be found, along with other very interesting analyses of social assistance issues.

Everyone who has examined this issue agrees that rates are simply inadequate. Two thirds of social assistance recipients spend more than their allotted shelter subsidy on rent; that's because the maximum amounts provided for shelter are far less than the average cost of rental housing in any Ontario city. Just to use Thunder Bay as an example, a single parent with one child on social assistance receives a maximum of $511 for shelter, which includes rent and utilities. The average cost of a two-bedroom apartment in Thunder Bay is almost $700. The average cost of a one-bedroom apartment in Thunder Bay is more than the amount that a single parent with one child receives for shelter. Most people on social assistance have to spend money that's supposed to be for other basic needs to maintain their shelter. Use of food banks has steadily increased as people use their food money to pay for rent.

I think it's important for you all to remember that we are talking about people who everyone would agree have no option but to rely on social assistance for their basic needs. These are people who've been through the process, they've provided all the documentation; they've been determined to be eligible. They don't have any other choice. They're people who are temporarily unemployable because of health reasons. They are single parents with small children who've just left a relationship. They're older people, 50 years old, who've been downsized and have run out of employment insurance, have degenerative disk disease in their back and can't do the kind of work that they've done before. These are people who have no choice. That is why we have a social assistance system in Ontario: it is to provide the necessities of life for these people who everyone agrees should be receiving benefits. But the benefits they receive now aren't enough.

I'd like to give you just one example. I could sit here all afternoon and give you examples of the hardships faced by our clients, but I've included in my submission an example of a client of our office who was a woman in her early 50s who had always supported herself as a waitress. She's a single woman, no children, no family to provide any support to her. She had medical problems. She had to have surgery on both her knees, so obviously she can't work as a waitress while she's recovering from the surgery. Everybody would agree that she has no choice but to go on social assistance. She got employment insurance benefits as long as she could, and then she had no income; she had no money to pay for basic necessities. So she applied for Ontario Works benefits.

As a single person, the maximum amount of benefits she's entitled to receive is $520. That's made up of a maximum shelter amount of $325 and a basic needs allowance of $195 to pay for everything. She lived in a small house that she had rented for a number of years, and the rent was actually quite reasonable. It was only $400 a month. That's less than the average cost of a one-bedroom apartment in Thunder Bay. But once she'd paid the rent, she didn't have enough money left to pay the utilities and buy food. She's never had any experience on social assistance before; she had always worked. She was astounded because, from reading the newspapers, you get the sense that people on social assistance are living a life of Riley, sitting around drinking beer, according to Premier Harris.

So she contacted her worker, thinking there must be some mistake, that there must be more money available. She was told no, the most she could get was $520. She said, "What can I do? I'm going to be off work for the winter. I can't go back to work for months yet. How am I going to survive?" Her worker said, "I guess you should move to somewhere cheaper." Move? This woman can't even walk. She's had surgery on both her knees. How could she find somewhere cheaper? There is no place cheaper. I mean, $500 for a single person is really cheap in terms of accommodation.

As I said, this woman is not a woman who has choices. She has no family in a position to support her. She has no option but to rely on these benefits.

She spent the winter huddled in her frigid house, because she kept the heat turned way down because she couldn't afford to pay the utility bills. She relied on friends to bring her food. She was fortunate that she had a sympathetic landlord who allowed her to fall behind in her rent on the understanding that she would catch up later, when she was in a position to do so. Many landlords aren't in a position to be that sympathetic.

She survived, but at what cost in terms of her dignity and her self-esteem, in terms of her health? She's not an isolated example. People who have to rely on social assistance should receive enough money to pay for the necessities of life in Ontario in the year 2001.

When the cuts were made in 1995, the government promised that people would be able to earn back the difference if they found part-time work. There's a program called the supports to employment program that was introduced in the late 1980s to assist in the transition from welfare to work by allowing people to keep a certain percentage of the money they earned before they were cut off social assistance, so that even when they were earning money and weren't eligible for monetary benefits, they might still be eligible for prescription medication coverage or something, just to ease the transition from social assistance to work. It's been a very successful program, and these sorts of programs that help people make the transition from social assistance to work have been successful in other jurisdictions in Canada and in the United States.

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This program has recently been gutted by the provincial government. Recipients who work part-time will now be able to keep less and less of their earnings over time. The longer they have earnings, the less they can keep. Rather than an incentive to find full-time work, these changes amount to a penalty for those who are unable to find full-time work. It's basically a disguised welfare cut, as people with earnings will see their welfare benefits decrease over time.

With respect to the general issues of adequacy of social assistance benefits, the recommendation we make to the committee is that benefits must be increased generally to recipients of social assistance. In particular, social assistance rates should be raised immediately to the levels they were at before the rate cuts in 1995. In future, rates should be set after careful analysis of the true cost of living in Ontario, not some sort of artificial 10% above the provincial average which doesn't take into consideration that the cost of living in Ontario is more expensive than in other areas of the country, and provision must be made for automatic annual cost-of-living increases in social assistance benefit levels.

I've been talking mostly about Ontario Works benefits, which were subject to the rate cuts in 1995. Disability benefits, which are now paid through the Ontario disability support program, were not reduced in 1995 but have not been increased either. They are also inadequate, although they're significantly higher than the benefits available to people who can't meet the very stringent definition of a person with a disability. Time-limited changes in the variable exemptions under STEP should be revoked.

I'd like to speak for a few moments about the particular issue of child poverty. The number of children living in poverty in Ontario has increased in the last 10 years, in both relative and absolute terms. Researchers agree that adequate income and a healthy start in life have an immense long-term impact on the well-being of children. Poor children have higher rates of health problems, learning disabilities and emotional problems.

The federal government has acknowledged the importance of public investment to protect children from poverty. The national child benefit supplement was introduced in 1998 and increased the amount payable to families with dependent children under the child tax benefit. But the provincial government immediately started deducting the amount of the national child benefit supplement from the cheques of social assistance recipients. These are the poorest of the poor children in Ontario. Yet when the federal government tried to assist their families, the provincial government simply took the money. This is a windfall for the provincial government, because it's money that's deducted from benefits that have remained static. It means the poorest children in the province receive no benefit from the national child benefit supplement.

Poor children live in poor families. They are not poor in isolation. Efforts to alleviate child poverty have to recognize that there have to be efforts to alleviate the poverty of the whole family. There are not enough good jobs to enable all poor families to lift themselves out of poverty. If every available job opening in the province was filled today, there would still be people who would be reliant on social assistance because they would not have a job. The meagre, inadequate amounts of social assistance benefits mean that children in families relying on social assistance are being deprived of the necessities of life in the present and of opportunities for the future. Report after report details the painful choices made by parents on social assistance as they try to decide whether they should pay the rent or pay the utility bills, and decide to keep children home from school rather than send them without lunch because there's no food in the house.

Benefits that are available through assistance to families with children, such as the back-to-school allowance paid in the fall and the winter clothing allowance, are hopelessly inadequate. The winter clothing allowance is $105. That isn't enough to buy a snowsuit and a pair of boots, let alone anything else you might need for the winter. It's only available if the family has been on social assistance in the month of November. If they have earnings in November and they don't get a cheque, they don't get a winter clothing allowance in December, January or February.

Reductions in social assistance payments have resulted, as predicted by those of us who made submissions to the government about the intention to reduce, in increased pressure on other government-funded programs. You will probably all have noted in the paper in the last few days that the provincial government recently announced increases to the budgets of child welfare organizations because the number of children involved with child welfare organizations has increased dramatically in recent years. This is not a coincidence. This is something we predicted when the government indicated they were going to make less money available to families with children. Children's aid societies across the province recognize that the increase in the need for their services is related in part to the desperate poverty experienced by families on social assistance.

We recommend that the benefits paid to families with children be increased in several ways: that the clawback of the national child benefit supplement be ended immediately and that families on social assistance be entitled to keep that supplement, and also that the amounts paid for back-to-school allowances and winter clothing allowances be increased and be more widely available.

Housing: Homelessness is increasing across the country. Reliance on emergency shelter has increased in Ontario to a frightening extent, particularly among families with children. More and more families pay more than 50% of their income on rent. Among social assistance recipients in Toronto, the number of families that use some of their allowance for basic needs to pay for shelter because the shelter subsidy is hopelessly inadequate, is higher than 60%.

The production of social housing in Canada has fallen dramatically in the last 10 years. Waiting lists for subsidized housing have grown just as dramatically. The goal of affordable, safe, secure housing for all families is of course a long-term goal and is dependent on senior levels of government developing a long-term housing policy. But in the meantime, it's important that low-income families be provided with sufficient resources to secure adequate housing. Shelter costs, which are the most significant item in the budget of most families, including families that depend on welfare, are much higher than the maximum amounts available for shelter in social assistance programs. The shelter subsidy amounts are simply too low.

Even families that are fortunate enough to live in rent-geared-to-income housing find that their tenancies are less secure than was previously the case. Our legal clinic provides services in tenancy law. Prior to the welfare rate cuts in 1995-and I've been doing this work since 1984-having a client who was being evicted from subsidized housing because of rent arrears was really rare. People recognized the importance of trying to maintain subsidized housing, and they did everything else to catch up if they fell behind in their rent. They used their food money and went to food banks. They cut corners in other areas and got their rent paid up to date. It was really rare to see somebody being evicted from subsidized housing for rent arrears.

Since 1995, our office has seen dozens of families facing eviction from subsidized housing because of rent arrears. There is so little money available to these families that an unexpected expense leaves them no option but to use money earmarked for rent, with no way to catch up. You can't cut back on food money and start running to the food bank when you're already going to the food bank because the money you receive is so inadequate.

Our recommendation is that the maximum shelter subsidy amounts be increased to reflect average rents in communities in Ontario.

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A word on the issue of violence against women: the cuts to social assistance programs have had a devastating effect on women fleeing violent relationships. The Ontario Association of Interval and Transition Houses reports that 100% of their members felt that cuts to social assistance had a severe impact on survivors of abuse. Women are choosing to stay-it's not a real choice-in violent relationships or to return to violent relationships when they're faced with the option of not being able to provide the necessities of life for themselves and their children. When they go into a shelter for abused women and find out how much money they're expected to live on in the community if they leave their spouse and try to set up their own residence, they feel that it's just not possible. The government has stated that it is concerned about the issue of violence against women, but its actions in reducing the benefits available to women who are trying to leave violence have increased the likelihood that they will be forced to stay.

In conclusion, the Steering Committee on Social Assistance urges the standing committee to recognize that social assistance payments in Ontario are not adequate to meet people's needs, and to recommend that the government immediately take steps to improve social assistance benefits in accordance with the recommendations we've made.

Thank you for the opportunity to speak to you this afternoon.

The Chair: Thank you very much. I'm going to take one quick question from each caucus. We have three minutes left, so I'll be tight on the time. The government side.

Mrs Molinari: Thank you very much for your presentation. I don't have a question but I would just like to make a couple of comments.

It's important to note that Ontario's welfare rates are 34.7% higher than the average in the other nine provinces, and you have indicated some of that in your presentation. I wanted to clarify that for the record.

With respect to the national child benefit program, Ontario has reinvested $100 million in 1998-99 in the Ontario child care supplement for working families, bringing the total value of Ontario's supplement to $200 million annually. You indicated in your presentation about the money coming from the federal government. We have reinvested it in child care and services.

Also, the 1998 poverty profile report released in December by the National Council of Welfare states that Ontario's poverty rates were among the lowest in Canada and were well below the national average throughout the period.

So we are concerned about some of the issues you've expressed, and certainly as a government we feel there's always more that we can do and that can be done. Certainly in listening to presentations, the suggestions and recommendations you have will be taken into consideration with a number of others that come forth. When the pie is only so big, it's challenging for the government to be able to make decisions-

The Chair: Ms Molinari, we're out of time.

Mrs Molinari: That's my last comment. It's difficult to make decisions and please everyone, but certainly your recommendations will be taken into consideration. Thank you.

Ms Colquhoun: Just with respect to the investment in child care with the money that's being deducted from the national child benefit supplement, I would argue that it would be more useful to families to have that money directly in their pockets to pay for food and housing.

The Chair: The official opposition.

Mr Phillips: Thank you. I appreciate your comments.

There's a fundamental problem, I think, and I've said this publicly many times to the government. I think what has disturbed me the most about the actions of the Harris government are things that Mr Baird has done recently. I've said this publicly. A year ago I was with our local member here. We went across the North Shore of Lake Superior and went into a city hall and there was a poster there: "Phone this 1-800 number if you suspect anybody of welfare fraud." It was sort of like a Wanted poster. He often gets up in the House with a gold credit card, implying that thousands of people on social assistance have these gold credit cards that no one else has. There are his actions with the syringes and the drugs. In my opinion, rather than being the advocate for the most vulnerable in our society, he is attacking them.

I've said it to his face, I've said it in the House, and I'll say it again here: we should be ashamed of ourselves for demonizing people on social assistance. They are the most vulnerable in our society, and 99.5% of them are there for reasons not of their own doing. I know it's politically convenient and useful to attack people on social assistance, but until we change that, we'll never tackle your issues. I don't know how to solve it. I really don't. I think perhaps the Legislature has to humanize this. Perhaps a legislative committee has to meet in the community with people on social assistance to understand how they're struggling. We have to go back to the days of the Bill Davises of this province, who recognized that we have a responsibility to those people.

Ms Colquhoun: I agree, Mr Phillips. I think it's a moral issue, really, in terms of how vulnerable and unfortunate people are treated in our society, and at present they're treated very badly.

The Chair: I have to bring it to an end, Mr Phillips. Mr Christopherson.

Mr Christopherson: If more people knew that the United Nations has condemned Canada because of the number of children who are in poverty relative to the kind of wealth we have and the kind of economic boom we've had in the last half-decade, it might shake them up a bit. Quite frankly, just to pick up on a bit of what Gerry was saying, it's outrageous and it's just mind-boggling to believe the government, with pride, within weeks of taking power, announced that they were going to cut the income of the poorest of the poor by 22%.

If they had said that the very wealthy in this province are going to cough up 22% every year, there would have been a counter-revolution within 24 hours. As it was, not enough people said anything. I was at a demonstration in Hamilton; there were about 15 of us. It was heartbreaking. I have no doubt in my mind that when the history books are written, this is going to be seen as one of the darkest times in the whole evolution of Ontario as a civilized society. It's just so outrageous, and the fact that you can come in and remain so calm says a lot about you, because it still drives me crazy that in my lifetime something like this happened. I still find it hard to believe that it really happened.

Further to that is the fact that they took this windfall money where the federal government finally-and let's recognize this is the federal government that decided they had $100 billion extra to give away to the very wealthy-at least put this in place, and these guys scooped it and said, "We're going to use this to give further tax cuts to our rich friends."

It's outrageous that it's happening. Welfare rolls are increasing, and those are the people who did manage, as you point out, to get through the system. January showed us there were 4,500 more people in Ontario on social assistance. When that happens in this province under their rules, you know we've got serious trouble, so please keep doing what you're doing.

Ms Colquhoun: OK. Thank you.

The Chair: On behalf of the committee, thank you very much for your presentation this afternoon.

NORTHWESTERN ONTARIO DEVELOPMENT NETWORK

The Chair: Our next presentation is from the Northwestern Ontario Development Network. Could you please step forward. On behalf of the committee, welcome. Please state your name for the record, and you have 30 minutes for your presentation this afternoon.

Mr Harold Wilson: My name is Harold Wilson. Ladies and gentlemen, thank you very much for coming to the northwest and providing this opportunity for us to give comment during the pre-budget consultation period.

I am the executive director of the Northwestern Ontario Development Network, an association of community development practitioners and partners in northwestern Ontario. Our core membership consists of the economic development offices and community futures corporations serving the region, which extends from-always the geography lesson-Manitouwadge to Kenora, from Atikokan to Pickle Lake, but also includes some 33 economic development people through the Nishnawbe-Aski development fund. To drive west to east would take nine hours, equivalent to the drive from Windsor to Montreal.

Approximately half of the region's population of 246,000 resides in Thunder Bay. With the exceptions of Kenora at 17,000, Dryden at 10,000 and Fort Frances at 9,000, the remainder of the communities have a population of fewer than 5,000 people, often separated by distances that are unparalleled in the rest of Ontario. In 1981 the region was home to approximately 236,000. A review of our current demographic trend suggests that the minuscule total growth rate for the region of 4.2% over the period of 1981 to 1996 may even now be eroding.

The northwest has been well served by this government's commitment and investment in our roads these past few budgets. There is still much to be done, and we are hopeful that this concentration of financial support for infrastructure continues. However, our concern today lies with the fundamentals of our economy. We look to your committee to consider the opportunities to make effective changes that will assist our communities to improve themselves. Identifying the directed, strategic investments that are needed and working to make them happen define the efforts of our economic development members.

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The first fundamental issue is the fact that the existing property-based municipal tax structure does not provide an adequate tax base for northern Ontario communities. This is because the north is a resource-based rather than a property-based, manufacturing-based or population-based economy. Inadequate revenue generation from a property tax base has resulted in the dependency on transfer payments and support. Northern Ontario is not self-sufficient or self-sustainable at the municipal level, and the sparse population and vast distances between municipalities are an even bigger issue in the northwest than in the northeast.

Despite the opportunities of the new economy, the resource-based sector remains the engine of regional wealth and job creation. Much of our future still rests with the development of our natural resources rent with a value-added component. As the share of revenues generated by our natural resources to companies and government has increased, the wealth from our resources, which fuels our communities, continues to be reduced within the region, with less available for the services whose costs are increasing. Current measures to support our economy are short-term and subject to cost-cutting measures. Moreover, inadequate already, our current tax base is also shrinking. Service or user fees are also inadequate tools to fund municipalities and their services. Increasing the tax base or reallocating the wealth generated in the area has yet to be addressed.

The Northwestern Ontario Development Network, in association with the Northwestern Ontario Municipal Association, NOMA, and the Federation of Northern Ontario Municipalities, FONOM, produced in 1997 a discussion paper on the rationale for a resource revenue retention mechanism for northern Ontario. While a preliminary review, it is a concept that deserves to be thoroughly discussed with the provincial government. It is one method to address the shortcomings of the existing property-based municipal tax structure in northern Ontario.

Our organization and others have long requested that consideration for the economic rents that our resources bring in and the considerable taxes paid to the province find their way back to supporting our local municipal organizations in a consistent, comprehensive manner. For example, in 1997, direct contributions to the provincial government from forestry operations in the northwest were $304 million.

We need the support of the Ministry of Finance to consider different mechanisms, such as that of the Iron Range Resources and Rehabilitation Board in Minnesota. It has long been an instrument to return some of the wealth generated by the Iron Range to the regional economy, for use in developing its own economic development initiatives. This is but one model that needs to be reviewed for applicability to the northwest. The Ministry of Finance is the perfect instrument to do this.

As was stated previously, we are a resource-based economy and lack the tax base to support necessary infrastructure investments. For example, telecom infrastructure is essential in moving to the new economy. In the northwest, we do not have the concentration of population to attract the private sector investment without government support. At the same time, government investment based on a per capita formula ensures that population-rich areas in southern Ontario will experience significant leading-edge infrastructure enhancements, while our region prepares business case upon business case for approval of the most basic services. It is important that the north be provided with the tools necessary to have a significant impact on providing essential services and enhancing their ability to compete for investment.

The system in place ensures some transfer of funding from the province. However, it is through specific programs and the specific identified priorities and requirements of senior levels of government. Often, these do not match the needs that are recognized at a community level. To repeat, a commitment to consider alternatives to the municipal tax structure that currently exists must be reviewed.

Of particular interest to economic development practitioners in the northwest is the role of the province. To quote the Ontario Jobs and Investment Board's A Road Map to Prosperity:

"Economic prosperity is a `bottom-up' process that is driven by individuals' pursuit of opportunities and success;

"There is a great regional diversity within the provincial economy and no single recipe will work for all regions or communities to create jobs and economic growth....

"Economic development cannot be `commanded' by government, although governments have important roles to play through leadership and facilitation."

The provincial government has increasingly placed the responsibility for economic development at the municipal level. At the same time, the province, which used to have a significant role in community-based economic development, has withdrawn its support. The province's previous support enabled community-based economic development to be delivered in a formal, professional manner by our individual communities. The loss began with the phasing out of the municipal economic development assistance program.

Projects require nurturing, partnership-building, community involvement and advocacy to all three levels of government-a long-term activity. Return on investment often takes years, and while it is easy to show the benefits after a project is completed and the tax assessment has been enhanced or in some cases stabilized, this is not automatic; it never has been. The smaller centres require sufficient resources to take on the task of considering new initiatives. These projects and opportunities could become the enhanced tax base we need. To repeat, the northwest generates great wealth, but it does not find its way to the tax base.

We would hope that the Ministry of Northern Development and Mines, as the lead ministry for northern Ontario, would be properly and effectively financed. It has a key role to play at the community level, but it is unable to participate financially. This issue of some funding allocated at a local level for the Ministry of Northern Development and Mines to participate is essential to develop the types of projects that can later attract the funding of SuperBuild, the northern Ontario heritage fund or other supports. Many of the projects currently funded through the large capital programs that exist have had their beginnings as very small, local projects. Work is done locally to develop the feasibility of a project; then external dollars are sought. Projects require considerable partnership dollars at the community level.

Presently it is the municipalities and the federal government through Fednor that provide investment seed dollars; the province is not there. It is crucial that MNDM be provided with some walking-around money and get back to the role of being an advocate for seeding community-based economic development, to be able to participate, leverage the provincial interests and harvest the results. Without specific commitment from the province to support the promotion and effort required for effective community-based economic development, local projects to enhance the tax base will be more difficult to get off the ground.

Another opportunity to broaden the tax base for our communities is in provincial approval of cottage lot development. NOMA completed its Crown Land Acquisition Study in April 1998. Several municipalities have been ready for some time to proceed on the acquisition, having prepared the required development plans. This approach has long been advocated, but for years municipalities have been discouraged by the Ministry of Natural Resources. Support from the provincial government, from the minister to the district manager, for communities that are ready is required immediately. There is great potential, but it requires the desire and action of the province. The economic development practitioners welcome the chance to be included in the assessment and approval process at the local level.

Another critical need is private investment capital in the northwest. Labour-sponsored venture capital corporations such as Working Ventures are very well set up to remove money from our area, but there is no mechanism for investing that money back into the region. There are significant incentives to encourage people to invest into these vehicles, but although there have been many attempts, including by this government, to ensure that investments are made, they have not been made in northern Ontario; there are no plans that we are aware of, nor have there been any investments in northwestern Ontario by Working Ventures. The other labour-sponsored funds are even less likely to consider investment here. We have the need but not the tools.

In the early 1990s, the province's small business development corporations program was wound down. This program provided one mechanism by which local people and communities could have invested in a corporation, with some tax support, and then been able to have it invest in projects within the defined geographical or sectoral area. Initiatives similar to this should definitely be looked at again. The opportunity for people to utilize their RRSPs for strategic investments in local projects would be a significant step forward for northwestern Ontario.

Last but not least is the importance of provincial investment in our institutions. It has long been the history of northern Ontario that the surpluses from the resources culled in our region were used in the southern part of this province for the construction and development of many important institutions, from the Parliament Buildings to museums, universities, hospitals etc. The development and investment in our northern institutions is critical. These become economic engines in themselves and will support considerable economic activity through their presence, adequately funded. Confederation College, Lakehead University and our hospitals throughout the region are but examples.

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A project that has been proposed and is supported across northern Ontario is the Northern Ontario Rural Medical School. An institution of this nature will serve many purposes, such as increasing the possibilities of health professionals remaining in the north.

However, it would also be a profitable, strategic investment from an economic development standpoint. Companies that are considering locating in northwestern Ontario or expanding want to know that employees will be able to get adequate health care. This issue is increasingly a factor in our ability to attract business. For example, Pickle Lake has gone for a five-month period without any doctor or nurse practitioner. How can one attract either employers or their employees? In addition, the proposed Northern Ontario Rural Medical School will itself become an economic engine that will spawn other possible business opportunities and must be considered a strategic, long-term investment.

There are great opportunities in the northwest, and always have been. We need to work with the provincial level of government to develop more effective methods for revenue retention and expansion. As The Road Map to Prosperity stated, "Ontario needs to champion and embrace change, not resist it." Fundamental changes to the existing system are crucial. We want growth in population, employment, innovation, amenities and the tax base in the north. The province needs us to be a strong contributor, and we want this too. With your help, we can again be the choice location to live, work, invest and raise a family.

Thank you for this opportunity to present to you today.

The Vice-Chair: Thanks very much, Mr Wilson, for your presentation. It was very well put together and very thoughtful.

We have about three and a half minutes per caucus and we start with the Liberals.

Mr Kwinter: Thank you very much. I totally agree with your presentation. Earlier today we had a presentation by the mayor of Thunder Bay, who felt there should be some more user fees, there should be taxes on fuel, a municipal fuel tax. I feel that is not the solution to the problem. I think the government has a role to play.

I just want to relate to you an exchange I had with the then Minister of Economic Development and Trade, Bill Saunderson, in the House back in 1995. He said that the government has no role to play in economic development. When I got back to my office I sent a letter to Judith Wolfson, who was the deputy minister, and I said, "If the government has no role to play in economic development, what kind of a boondoggle are you running over there? Why don't you shut off the lights, send everybody home and save the taxpayers a pile of money?"

I never got a reply to that, but the thing that I feel very strongly about is that there are resources being developed in the north. I think that is where there is an opportunity to get some financial input into further development in the north. I think that's something that should be pursued because, quite frankly-and you've spelled it out in your presentation-a lot of these labour venture funds look at these proposals and they don't make initial economic sense. As a result, they have a difficult time justifying to their boards of directors: "Why would we put money in there when we're not going to get what we consider to be a reasonable return?"

The other thing I want to comment on, and I'd like to get your reaction to it is, we had various regional development corporations back when we were in government-I think they were there before we got into government-and they performed a very useful role. One of the greatest criticisms I used to get when I was the minister and went to estimates is that people would say, "Your bad-loan risk was too low. You were acting as a bank." Banks traditionally like to have about no more 1.5% of their portfolio in bad risks.

The development corporations were a little bit higher than that, but, as I say, our critics felt we should have been up about 10% because, "Otherwise, why do we need you? If you're going to serve the same function as banks and only fund projects that are absolutely foolproof and secured, then you have no role to play. Your role is to pick up where the banks won't go and provide the sort of investment to allow these projects in the north to have a chance to survive."

I think that's something we should continue to do. You spell that out, but do you have any comments on that?

The Vice-Chair: You've taken three and a half minutes, but we'll give you 30 seconds anyway.

Mr Wilson: OK, 30 seconds. First of all, the statement that Minister Saunderson made, I think I've seen actions from this government that show there might not have been that same thinking elsewhere. The OSTAR program, for example, and some other things have shown that the province does believe it has a role in economic development. It's just a matter of that role being in tune with the needs of the people and the populations.

Regarding the labour-sponsored venture capital, with so many of the investment firms it's the due diligence part that's the problem. I mean, when they're looking at a deal, they're figuring out, well, "Five trips to Thunder Bay. Let's see what Air Canada's charging these days." At $1,340 a crack times five, you've got to know it's a really good project before you'll come up. So again, although the investment's there, it's the due diligence and people making these kinds of decisions who don't even consider projects, no matter their merit. That is a concern as well.

Regarding the NODC and those other forms, what we would prefer to see is more of what we call the walking-around money for northern development and mines, which we think has the role, has the leadership there, but just doesn't have the financial wherewithal to make it happen.

Mr Christopherson: Thank you, Mr Wilson, for your presentation. I would just point out that certainly I would agree with your argument that you've got to make the investments in the institutions if you want to have a community that works in all aspects, not just in terms of the service they provide, but the economic aspect of it.

It's probably even clearer when you get into the north because the numbers are smaller, so the picture's a little clearer: there isn't as much there. It's an important message for us to help take back to the government that when we talk about investing in institutions across the province, this isn't about special interests getting their itch scratched; it's about making sure we're putting Ontario's money where it'll do the most good. Of course, we would argue that that's even more important than a personal income tax cut where you've got a choice between the two.

Further to that, you mention Pickle Lake. That's a great example. I'm going to use that one, because nothing could get clearer in terms of the quality of life having an impact on investment decisions. You're right. You've got Pickle Lake five months with no nurse, no doctor. If you're a young family ready to lay down some roots and you've got a few kids, is this going to be on the top of your list? So I think that's an important message.

It's the same thing in terms of cuts to the environment. What upset us the most was that it's stupid economics in the long run, Walkerton being of course the biggest example. But anything that erodes the environment and doesn't give you as close to a pristine or as safe an environment as you can make is going to affect investment, because that's where the people are going to live. Again, I thank you for that message.

I have two straightforward questions. One is, can you just give me a quick outline of what the crown land acquisition study in April 1998 actually said, very briefly, and also a little bit on the Iron Range Resources and Rehabilitation Board in Minnesota? I was there not that long ago, a beautiful state. I've never heard of anything like this. I just wondered how it works.

Mr Wilson: I will be quick, as you said. With regard to the NOMA study, this goes back well over 10 years. In fact, I think I was there at the unveiling in 1987: crown land as a development tool. I hope I don't hear groans, but it was the idea that we would utilize crown land and they could use it at the municipal level to be able to develop-to do things to increase that tax base.

In 1998, NOMA, the Northwestern Ontario Municipal Association, released their report, ready to go. The minister at the time and the current minister were quite behind it, but it still hasn't happened. There seems to be some kind of slippage between what they want to see and the release of that land. There are some incredible hoops that have been put forth that they have to go through, and if they could be done jointly, that would be effective, but it seems that to relinquish control over land is something that is not being supported by the Ministry of Natural Resources, and therefore an opportunity to enhance the tax base is not there for them. Again, it's been pursued a lot by NOMA and we've been supportive of them.

On the second matter, the IRRRB is in northern Minnesota. I believe it just had its 50th anniversary the year before last, and it is a mechanism by which some of the tax dollars that are generated through the Iron Range can be returned into a fund that is administered and the priorities chosen by the people of that area.

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Mr Christopherson: Is it a transfer from the collection on government?

The Vice-Chair: Thank you very much. We'll move on to Mr Gilchrist.

Mr Gilchrist: Thank you, Mr Wilson, for the presentation. It's going to sound like a broken record, but I too agree with most of the points in your submission here. In particular I appreciate that you've made a suggestion similar to one we heard earlier this morning about the idea of creating a mechanism where folks in the north could be able to invest in either a venture capital fund or some RRSP mechanism to ensure that their money stays in the north. I posed the question earlier today and I would seek your response as well, whether the existing municipal and provincial public sector union funds should be required, given that 10% of the population is from North Bay west, to invest 10% of their funds in the north? In the case of the teachers' fund, that would be an immediate infusion of $6 billion in the northern economy.

Mr Wilson: That's interesting. I'll go around it in a circuitous way. The first thing, with the issue of labour-sponsored venture capital: yes, some mechanisms have existed before. They've tried a couple of things; some of them haven't worked. It always comes back down to the RRSP side of things. So you're right, if we can find some mechanism to do that, then some investment will be there.

It will be interesting to see, though, what the response is going to be, because some of the pension funds that are already set up do make investments. I understand that the teachers' pension fund is one of the bigger investors in WestJet, which has been an incredible boon to northwestern Ontario; also Cadillac Fairview. You will find that some of their dollars, I believe, have gone to Intercity Mall. So there are some things from that.

Unfortunately, we're not 10% any more; we're down to about 8% and our concern is that, as Ontario grows-it's estimated to be, what, 14 million by 2010?-we might not be growing at all. This becomes another issue too, and a need to try to stimulate our area, hence the importance of really considering mechanisms that haven't been tried yet. I would think that they should be looking at, with their membership-and their membership should also be advocating-what kind of investments they are making in the areas that they come from, where they are resident.

Mr Gilchrist: Isn't that the irony? Presumably 10% of the teachers are represented in the north, not to single them out. They just happen to be a homogeneous group. We don't have to talk about, in the municipal plan, which municipality contributed which amount of money. But the principle that those who live in the north, who are seeing the same issues that you and others have described here today, are ironically sending their pension funds to support other things in Canada, internationally, and in southern Ontario-we appreciate the dollars that have stayed in Ontario, but it seems to me it would make a lot of sense if their own interests were furthered by ensuring that those dollars were kept here.

Let me ask you one very quickly, if I've got 30 seconds. We can approach the issue of economic development one of two ways: funds can be raised somewhere else and applied in an area that in and of itself might not be self-sufficient, or you could eliminate more taxes in those areas that you want to stimulate and attract business there. So rather than artificially maintaining a higher tax level somewhere else to provide a subsidy, what would happen if, let's say, northern Ontario was to see a different sales tax rate or a different income tax rate or a subsidy on your property tax? Would that have the same or a better effect than bringing southern Ontario money north?

Mr Wilson: To go out on a limb, the issue with the property tax is a difficult one. If you take a look at some communities that are in difficulty, their cost of a home is so low that that itself should be the attraction, and yet that isn't the thing that's attracting. They still need the jobs. In a sense, they might be more interested in that, but you need those strategic investments.

About the issue of cutting the taxes or some of the sales tax, I advocated a WCB-free zone at one point. Let's see what happens there, if we can attract investment to a specific area, just to try something, in the same way they have free-trade zones and other things like that. I think we've really got to be creative and look for some other things that will stimulate.

But it's strategic investments that need to be done to bring the infrastructure in the north to at least the same level as enjoyed-I know in rural Ontario they don't have that infrastructure benefit either, and I know that work through OSTAR and other things are helping with that. But I think we have to take a look at the strategic investment side in parallel, if we're going to look at tax cuts or anything like that, because if those investments aren't there, if people aren't prepared, you won't be able to attract the businesses.

The Vice-Chair: On that positive note, thank you very much for a very thoughtful presentation. On behalf of the committee, thank you for being here.

THUNDER BAY CHAMBER OF COMMERCE

The Vice-Chair: Our next delegation is the Thunder Bay Chamber of Commerce, Mary Long-Irwin, president.

Mr Don Slobojan: Needless to say, I'm not Mary Long-Irwin.

The Vice-Chair: He doesn't look like Mary Long-Irwin to me.

Mr Phillips: Mrs Molinari isn't here right now, but just in case I forget, I think she mentioned the number on the average-I think 34% or 37% higher. I hadn't heard that number before, and just so I don't forget it, I wonder if we might ask her to table the source of that for us. It would be helpful.

The Vice-Chair: Welcome. We appreciate your coming. State your name for the record. You have a half-hour, part of it for presentation and the rest of it divided among the three parties to ask you questions and for discussion.

Mr Slobojan: Thank you very much, Mr Chair. My name is Don Slobojan. I'm the first vice-chair of the Thunder Bay Chamber of Commerce. On behalf of the Thunder Bay Chamber of Commerce, we welcome the opportunity to present before the standing committee on finance and economic affairs. We have three issues that we would like to go over this afternoon: the northern medical school, transportation issues here in the north and a review of the retail sales tax.

We all realize that our physician shortage in Canada is at the breaking point. However, in the north it has reached the crisis point as far as we are concerned. Ontario has fewer physicians than it needs. The shortages are particularly serious in northern, rural and smaller communities. A quarter of the province's population lives in rural Ontario, yet only 10% of family physicians work in these communities. We can no longer apply Band-Aid solutions or quick short-term relief for this crisis. It has not worked, and in the long run this crisis has only got worse. The government must work collaboratively on measures that will encourage more physicians to work in the province's rural and northern areas. We need a long-term-solution approach to this issue.

The proposed northern Ontario medical school, to be operated out of Lakehead University and Laurentian University, offers a solid solution that not only addresses the northern region physician shortage but will also assist in solving the concerns of many other communities across Ontario, as many smaller communities in southern Ontario are also finding it more and more difficult to recruit doctors to service their populations.

We know this is not a new concept. This issue has been successfully responded to in other areas such as New Mexico, Grand Forks, northern Europe and Australia, with success in both increased enrolment of medical students and in graduating family doctors and specialists who are remaining in the area and setting up practices in rural and underserviced regions.

Networks for teaching already exist in the north. Both Laurentian and Lakehead have solid undergraduate science programs with strengths in the new biomolecular sciences and provincially accredited nursing and nurse practitioner programs. Both hospitals that serve these communities have the potential and the desire to work with their university partners to develop teaching hospital status.

This issue has strong support from mayors, chambers of commerce and residents from northern communities such as Sault Ste Marie, Timmins, North Bay, Thunder Bay and Sudbury.

Here in Thunder Bay we have respected physicians and specialists who are leaving because of the existing shortages and long hours, with no light at the end of the tunnel. Some of these doctors are leaving for the United States. All of us in this country lose when this happens. Clearly the problem is getting worse with each passing day. We must act now. Not doing so has brought us to this critical situation. The north needs to have its own medical school to resolve this situation.

On the second issue, our organization has over 1,000 businesses located in Thunder Bay and just over 2,000 throughout northwestern Ontario in our northwestern Ontario associated chambers of commerce affiliation. We also have a strong transportation committee working on these issues. All of us are in some way dependent on transportation for our ongoing viability.

As a result of the city of Thunder Bay community development plan, now called Thunder Bay Fast Forward, a new Thunder Bay transportation council has been created. This council consists of representatives of the owners of public and private infrastructure in our area: highway, road, rail, marine and airports. The council also includes in its membership the owners and operators of the carriers: trucking, busing, airlines and ships. The transportation council's mission statement is as follows: a forum for the development and viability of transportation in Thunder Bay and the region.

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Regarding some of the highways around here, one area we wish to raise with you is the plans of this government for new road development in this area. The chamber is of the opinion that the decision by your ministry to concentrate the last five years of funding on upgrading the existing network was appropriate. However, we understand that commencing with this provincial budget there will be an opportunity to begin work on some of the outstanding projects that have been in the planning stages for quite some time. We are raising this issue to allow for the construction of the first 13 kilometres of the Shabaqua highway, extending the existing Harbour Expressway west to connect with the existing Highway 11-17 at the 10th Side Road. This link will relieve what we believe to be significant pressure on the Arthur Street corridor. It will create a truck route with a direct connection to the heavy industrial area of the city. This will be supported by a ban on all but local truck traffic on Arthur Street, which is also known as Highway 17. This route has been in the planning stages since the mid-1970s. The land has been acquired, the right of way cleared and, we understand, all the environmental reviews completed. Its completion will divert the heavy traffic from a major thoroughfare that travels through a residential area.

We are strongly encouraging the provincial government to commit funding for this project in the next two budget years. We believe it appropriate that a small portion of the $1 billion allocated in the next budget for highway construction be allocated to this project.

A key area of concern for this region is the reality that both Highway 11 and Highway 17 share a single roadbed for a significant portion of the link between the junction of Highway 11-17 just east of Nipigon to Thunder Bay. Over the last number of years significant weather events and traffic accidents have forced the closure of sections of the highway for long periods of time. Where both 11 and 17 share the same roadbed, there is no Canadian road alternative to keep our east-west commerce functioning. It should be noted that when Highway 17 north of Lake Superior is closed, commercial travellers can access the northern Highway 11 with a minimum loss of time. The same is not the case between Nipigon and Thunder Bay. When the section between Thunder Bay and Nipigon is closed, or the section between Sistonens Corners and Shabaqua west of Thunder Bay is shut down, nothing moves between Manitoba and southern Ontario unless they go through the United States. In addition, some Canadian commercial traffic is prohibited from traversing US highways due to local state restrictions.

It is estimated that upwards of 70% of all truck traffic traveling through Thunder Bay is passing through, providing goods from southern Ontario to the west and vice versa. This route is clearly Ontario's only Trans-Canada trade corridor. A closure of this section of the Trans-Canada Highway is not in anyone's best interests.

We want to see our fuel tax dollars used to create a divided highway in all those sections where 11 and 17 are together. We believe that in the long term it makes good economic sense. As a country and as a province, we cannot afford to have our east-west commerce held hostage.

The members of the chamber understand that twinning this section of the highway is an expensive proposition. We also understand that a significant amount of planning needs to be done before the project can begin. We urge this government and the transportation ministry to accelerate the planning process and establish construction targets for commencement of the twinning. We also encourage the ministry to develop a 10-year plan that would see the project completed in a way that would provide stability in the highway construction industry in the area for a significant period of time. Our preference would be for the twinning to commence at either end of the corridor in order to deal with the most crucial sections first.

The chamber is of the view that this major undertaking should not be Ontario's responsibility alone. The initial construction of the Trans-Canada Highway was only possible through a major financial contribution by the government of Canada by designating the project as a matter of national importance. The Thunder Bay transportation council has written to the Honourable David Collenette and to the Minister of Finance, the Honourable Paul Martin, to request that the government of Canada contribute to the twinning of this section of the Trans-Canada Highway, and we support this initiative. We believe this contribution would be consistent with previous efforts by the federal government to assist the prairie provinces in their twinning effort, the construction and ongoing upgrading of the Yellowhead Route, which parallels the Trans-Canada Highway. We further understand that the federal government will accept applications for partial funding for this project. The province has every right to expect the federal government to come on board for the funding for the Trans-Canada Highway. Last year, Paul Martin had set aside $600 million for highways. We as residents from northwestern Ontario also have every right to expect safe roads.

The province of Ontario is investing significant funds, both capital and operating, in enhancing the tourist opportunities of this region. Private sector developments in the forestry and mining sectors will continue to add traffic volumes on the area highways. A further investment in the transportation infrastructure will ensure that there is a maximum benefit to both the region and the entire province of Ontario over the life of the project and beyond.

Here in northern Ontario we do not have the transportation alternatives readily available in other parts of Ontario; therefore we must rely more heavily on personal transportation vehicles for the economic and personal well-being of the area. We need roads that are not only safe but accessible at all times. This was considered an important improvement to the northwestern Ontario highway system 10 years ago, and there is no question that the need is even greater today with the increase in traffic that has taken place over that time period. The time for the province to act is now. If the province commits its own funding to this project in the next year's budget, it will be in a strong position to bargain with the federal government to provide support for the Trans-Canada Highway in Ontario, which we have all been led to believe they will.

The last issue we would like to bring to your attention is the retail tax issue. It was mentioned a little earlier. We suggest that the government consider a review of the provincial sales tax. Over 10 years ago it was proposed that the rate be dropped by 1% to 6%; unfortunately, the government decided to go the other way and raise it from 7% to 8%.

Interjection.

Mr Slobojan: Pardon me?

Mr Phillips: No, I'm just kidding.

Mr Slobojan: OK. We respectfully request that the Ministry of Finance consider this as the next tax to consider for reduction and review. Additional income tax cuts, as we know, will not assist those at the lowest level of our economy. By dropping the sales tax, you help those who use the majority of their income for consumption. Those at the higher end, as long as they live in Ontario, will receive a benefit.

Thank you for this opportunity to present our views and considerations in these pre-budget consultations. The council and the chamber of commerce certainly wish you well as you work toward the development of a budget that will cover these concerns.

The Chair: Thank you very much. We have five minutes per caucus and I will start with Mr Christopherson.

Mr Slobojan: Before you start, if you don't mind, Mr Wilson is backing me up. He was just here. He's the past chair of the board of the chamber of commerce. I'm fairly new on the block, so if you don't mind, I may have to refer to him.

The Chair: No problem.

Mr Christopherson: Excellent presentation. I want to comment that for the longest time I couldn't understand why so many of the chambers, which are made up primarily of small business-at least that's been my experience, and certainly it's the case in Hamilton-would support the emphasis being on personal income tax when small business needs the average citizen to have discretionary income so they'll spend money in their local establishments, thereby keeping the money circulating in the community. I think you're the first one I've seen who's come out and said it that clearly, and I want to compliment you for it.

I realize it's in self-interest-you're here to represent your community, the business community-but nonetheless it has always really bugged me that there wasn't this recognition that helping those who are at the bottom of the economic food chain also helps small business. And that means decent wages and it means a fair taxation system, and if you're going to do something along the lines of relieving tax pressures, make sure you're putting the bulk of the emphasis in the area where it will benefit our broader economy as well as the local economy, which is those who spend practically every dime they get. So I want to compliment you for putting that in there and for saying that, because you'll have some opponents within your corporate world who won't like that as much. They'd rather have it on the personal income tax, because if they're already pulling down a quarter million a year, that's where they'll personally see the benefit. This is a far better way to grow the small business community in municipalities, in my humble opinion, and I want to compliment you for that.

Having said that, I want to pose something to you, and I'm not trying to trick you. I legitimately said what I said and meant it and wanted to emphasize it. Now I want to place before you from that same perspective that came up with that-

Mr Galt: Watch him.

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Mr Christopherson: Never mind, Doc. That's just because he's so easily fooled, he worries about everything.

You've noted that you needed money and transportation, that to do some of the things you'd like to do is going to cost some big bucks.

Mr Slobojan: Correct.

Mr Christopherson: To address adequately the health care needs in the north is going to take some big bucks and, as was mentioned by Mr Wilson earlier, investment in the institutions is usually big-dollar stuff.

If it came down to it, where you had a choice between seeing the-

Interjection.

Mr Christopherson: I know, but these are the kinds of decisions we're given as legislators. But if you had to make that choice-again, this is not trickery or trying to put you in a political box. I'm curious: from what you've already said here, which one do you think would give you the better benefit? I'm obviously prepared to accept either answer, but if you had to choose either/or, which would be in the best interests of sustaining small business and growing it?

Mr Slobojan: Thank you, first of all, for the compliments and setting the things out. With what is available, and the federal dollars that are available at this point, I think the highway issue could be addressed. At the same time, if dollars are also available from the provincial government for starting the medical school, I think we can probably end up having both. I know that's not answering your question-

Mr Christopherson: But this is good. I'm just trying to get a sense of where you thought-really, I thought you were providing an honest comment there and I meant that. I was very serious when I complimented you on that. I happen to agree with you. I'm just curious how someone who says that then views the whole issue of those kinds of investments versus the benefits, economically, of a sales tax cut.

Mr Wilson: With regard to that, as you said, if you're providing that kind of a choice, again the issue of the sales tax cut has merit and really should be reviewed. It should be looked at because of this issue of being able to drop disposable dollars. What you're talking about with the other side, though, that would be strategic investment. I think your real question is choosing between strategic investments and income tax cuts-that seems to be more what you're choosing-rather than between sales tax cuts-

Mr Christopherson: Actually, that one I'm pretty clear on because I know where I'd go. It was on the other one where I was legitimately torn and wanted your opinion.

Mr Wilson: Again, one of the things with the sales tax cuts is, as has been noted-when they did income tax cuts they thought there would be less taxes coming in-there were more taxes coming in as people then utilized those discretionary dollars. I would suspect that with sales tax cuts, and from some people I talk to in retail, you may not lose anything from the retail sales tax perspective. The government would still be getting their money in. From a consumption point of view, that might be the stimulus they need.

Mr O'Toole: I'm probably going to share my time with the member from Northumberland if it works out that way.

I appreciate, Don and Harold, your presentation. I just want to make a couple of statements with respect to infrastructure, transportation specifically. We have heard a different kind of description in southern Ontario. But when you refer to it as the Trans-Canada Highway, that's where you really step off and say, "Just how much money does the federal government actually put into the highway system in Ontario?" It's surprising. We've committed, as you probably know, in the budget numbers about $1 billion in that. Arguably there's never enough of anything, but do you have any idea how much the federal government contributes, both in its own revenue sense from fuel tax and GST-a tax on a tax-to the infrastructure in Ontario, which is about 50% of the Canadian economy, of which you're an important part with the resource sector up here? Do you have any idea at all how much they actually contribute to the provincial highway system? Harold, any idea?

Mr Wilson: No, I really don't. I think it's zero.

Mr O'Toole: I think it's zero too.

Mr Pretchuk: I can answer that, actually. The Ontario trucking industry currently pays the same amount that the federal government puts into the entire Canadian infrastructure.

Mr O'Toole: I'm glad there has been a letter, as I see in your thing, to David Collenette and Paul Martin, and certainly you would be encouraged to pressure that. I certainly agree with you, the way you've described it, for safety and a whole bunch of other reasons, and the economy. It may answer the question that David Christopherson mentioned with respect to strengthening the economy. We heard that in Jim's presentation, the importance of having the right infrastructure to support the resource-based industries, because that's basically the economy up here really. So we accomplish a number of outcomes.

I know the health care issue is a huge one. The theory there of course is to educate them closer to home. Hopefully they'll be indigenous people, people related to the area, and they would hopefully stay here. I support that. Some of the larger medical centres may not. They have their own personal reasons to keep everybody in Toronto.

We're fighting the same issue here. There was a report issued today by the physicians. There's going to be a shortage of 1,300 family physicians in very short order. So just a couple of comments.

The Chair: You've got two minutes.

Mr Galt: I'm kind of curious on this promise that you have from the federal government that it would come through and assist the province to build that. I interpreted you to say a promise, or a good reason to believe they would, particularly when I see recently where they made a commitment in their red book back in 1993. When that commitment, word for word, was introduced by the opposition, they collectively voted against their own commitment, their own platform back in 1993. I wonder what kind of commitment you have if the province comes in to help, how you're assured that the feds are going to join in, especially when they'd vote against their own resolution.

Mr Slobojan: I guess we're never really assured of anything, but it's our hope that they would certainly step up and help out with a situation like that.

Mr Galt: But I got from you the feeling that you had assurance they would come through.

Mr Slobojan: I don't think we have-

Mr Galt: You don't have assurance. It's just that they have suggested they might have $600 million set aside for transportation-

Mr Slobojan: We were led to believe that's what the case was.

Mr Galt: -when they collect $2 billion taxes from Ontario drivers.

Mr Slobojan: We were led to believe that's the amount of money that was set aside for the different projects in the province.

Mr Galt: In the province or across Canada?

Mr Slobojan: Across Canada, I think. Pardon me, yes.

Mr Galt: When they collect $2 billion in Ontario a year?

Mr Slobojan: Right.

Mr Galt: It's good that you have that kind of assurance. It may give our Minister of Finance a little bit of comfort to look at doing something like that, because obviously on the Trans-Canada Highway, the federal government should be involved.

Mr Slobojan: There's no question in our mind about that.

The Chair: Mr Phillips.

Mr Phillips: Firstly, just on the tax policy issue, this is going to be a huge issue of debate over the next little while.

Mr Slobojan: Excellent.

Mr Phillips: Yes, I think it is. I might add, I wish this committee could have a debate on it. We asked the minister to come and have a debate on tax policy and he wouldn't. I really felt that's something we should be debating here. As Mr Beaubien will know, he wouldn't come to debate it.

But in any event, yesterday or the day before we had one of the senior bank economists in talking to us. We were talking about how in Ontario the average employee has health benefits that are worth the equivalent of $2,500, health benefits that they don't get in the US. The government tells us in its documents-I think it says that US manufacturers pay on average more than $3,100 per employee for the kind of health care coverage provided by Canada's publicly supported system, whereas Ontario employers pay about $540 per employee in employer health tax. So there's about a $2,500 cost advantage to companies in Ontario versus companies in neighbouring US states-quite substantial. The issue then is, how do we fund that? That comes from taxpayers. We have funded our health system in a different way than neighbouring US states.

He was also saying to us that, in his opinion, corporate taxes are going to continue to drop. In fact, the government's announced that taxes in Ontario will be 25% lower than in neighbouring US states. So it won't come, vis-à-vis neighbouring US states, from corporate taxes.

Then on the income tax side, they're saying we have to match the bordering US states.

I gather your recommendation here on tax policy is that we'd be better off, in the Thunder Bay chamber's view, reducing sales tax than in reducing income tax. I guess I have two questions. Does the chamber discount significantly the arguments of someone like the bank economist who said that we need income tax rates equal to bordering US states or people will move there? Secondly, I see a huge challenge in maintaining our health care system and, I might add, our education system in an economic slowdown and having taxes lower than the neighbouring US states. So I gather the chamber's advice to us is sales tax over income tax how does the chamber view advice to us in terms of how we fund our unique health care system?

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Mr Slobojan: I think we would really like to see a study on it, to take a look at those proposals. I don't have the answer for you right off the top of my head.

Mr Phillips: That's fair.

Mr Slobojan: We're bringing it to the government's attention to review it. That's part of the key.

Mr Wilson: If I can just relate the difference with Minnesota, one of the issues that's taking place right now in the northwest is that you have still a very strong and heated economy in Minnesota, and they're actually drawing some of our best people from the northwest. We have an unemployment rate that's much higher. In the United States in a lot of those areas it's 2% or lower, and 2% means even people who don't want to work are working. So you have this situation down there. They are attracting some of our people. So this issue of income tax is a consideration. Health care, though, that kind of investment, has some very great value, and to the companies as well as to why they would locate. Again, it's an issue. You're trying to take a look at two jurisdictions. There are lots of things in that mix.

The only other comment I would make, and this is a personal one, is that if someone from one of the national banks or wherever was making a statement about what would be best for Ontario's economy, again, from my presentation previously, that's not necessarily what might be best for the regions.

The Chair: With that, we've run out of time, gentlemen. On behalf of the committee, thank you very much for your presentation this afternoon.

Mr Slobojan: Thank you very much. We wish you well.

NORTHWESTERN ONTARIO ASSOCIATED CHAMBERS OF COMMERCE

The Chair: Our next presentation is from the Northwestern Ontario Associated Chambers of Commerce. I think we have two presenters. Could you please come forward and state your names for the record. On behalf of the committee, welcome. You have 30 minutes for your presentation this afternoon.

Mr Phillips: Mr Chair, before we begin, Ms Molinari is back now.

You mentioned in a previous presentation that Ontario social assistance rates were 34% higher, I think, or 37% higher, than the average. I hadn't seen that before, and I just wonder if you might provide the committee with that. I'd find that useful.

The Chair: Perhaps you could submit it to the clerk or the researcher.

Go ahead.

Ms Tannis Drysdale: I'm Tannis Drysdale, and I'm president-elect of the Northwestern Ontario Associated Chambers of Commerce.

Mr Tony Beyak: I'm Tony Beyak. I reside in Dryden, Ontario. I'm what's termed, on NOACC, a senior adviser.

Ms Drysdale: The Northwestern Ontario Associated Chambers of Commerce is the largest business group in northern Ontario. We represent the interests of over 2,000 businesses throughout the area. We are the voice of business for a geographic territory stretching from Marathon to the Manitoba border. We are proud that our membership also includes 14 of the largest corporations active in our region.

Annually, since 1931, when our association was formed, we have reviewed government policy and lobbied for progressive solutions that best fit with the needs of our communities. On behalf of our membership, I thank you very much for travelling to Thunder Bay today and allowing us to have the opportunity to have some input into the 2001 budget.

Over the past few weeks, Premier Harris began to lay out this government's renewed vision for continued growth in Ontario, smart growth. In the Premier's recent address to the Toronto Real Estate Board, this vision was structured primarily around the needs of our larger urban neighbours in the south of Ontario. It should be clear, though, that the concepts of smart growth-focusing on development that will create a strong, efficient economy; building strong communities; and preserving and protecting the environment-will be equally important in defining the framework for prosperity here in the north.

As you've probably heard a lot of today, we northerners like to spend a lot of time explaining how the many challenges of our businesses, communities and lifestyles differ dramatically from those of you who live on the other side of the map. At our core, however, we share the same vision of prosperity for our communities, region and province.

Mr Beyak: Focusing on development that will create a strong, efficient economy: It is the role of government to facilitate the environment in which our northern businesses can flourish. A strong, efficient economy and job growth in the north translates into infrastructure support, a well-trained workforce and continued attention to and support for a competitive business environment.

We believe that investments in quality highways will provide for economic growth by enabling cost reductions, improving the quality of goods and services, and allowing for expanded production and access to wider markets.

The improvements to the maintenance of our highway system throughout the northwest have not gone unnoticed by our membership. Given that in 1991 only 40% of this province's highways were rated in good condition, the goal of bringing that figure to 85% by the end of 2001 is to be applauded. Soon, maintaining the current highway system will not be enough to facilitate economic growth in our region. As we increase the use of highway systems for the purpose of trade and tourism, our systems must grow with us.

We recommend that the government of Ontario commit long-term funding to upgrade highways and work in co-operation with the federal government to develop multi-lane routes at key tourism and trade corridors. On the map attached to the back page of this presentation, you will see that Highways 11 and 17 meet west of Thunder Bay at Shabaqua and continue through to Nipigon as the same road. They are then from Shabaqua to Thunder Bay and from Nipigon to Thunder Bay the only east-west route through Canada. Closures on these stretches of highway cannot be avoided by traffic.

Given the importance of maintaining the free movement of materials and travellers across the province of Ontario, we would request that the twinning of this highway section be assigned priority in future planning. Making investments in infrastructure throughout northern Ontario that meet local demands and priorities through programs such as the SuperBuild Corp and the northern Ontario heritage fund will continue to be important to the development of our communities.

Heritage fund projects ranging from increasing our agricultural capacities to waterfront development have provided northern communities with the assistance they need to increase tourism, commerce and improve the quality of life. We eagerly await the announcement of the reopening of this fund to new applications.

The Northwestern Ontario Associated Chambers of Commerce has taken a leading role in promoting the development of tools and skills required by our membership to maintain their presence in the new economy. We anticipate government programs such as Connect Ontario will further serve to assist in overcoming the geographical barriers of our region.

As the lead agent representing most provincial ministries throughout our territory, the Ministry of Northern Development and Mines plays a critical role in our ability to access and communicate with the government. Therefore, we have been encouraged by the government's continued support for this ministry.

While job growth in Ontario has soared over the past few years, northwestern Ontario has only been able to grasp a small percentage of the dividends of the boom. Despite our limited growth relative to Ontario as a whole and continued higher than average rates of unemployment, investment in training or retraining has been and will continue to be a priority.

Commitments made by this government to bring business needs and the education system together are being well responded to by programs such as Passport to Prosperity and the Ontario youth apprenticeship program. The flexibility and responsiveness of Ontario's education system to the changing needs of our business communities will become more and more important as we in the north develop diversity in our economy.

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Ms Drysdale: We believe to this end that a provincial-federal labour market training agreement should continue to be pursued by the province of Ontario.

Maintenance of a strong, efficient economy must provide for continued attention to and support for a competitive business environment. This government has not only listened to the needs of the business community but has begun to make the changes necessary so that the business community feels confident about the future of this province.

A strong regulatory environment is not only necessary to provide equity for private citizens but it also assists our business community by creating universal rules of responsibility. In many cases in the past, regulations and restrictions on commercial activity have appeared without thoughtful consultation and remained there past their usefulness, hampering commercial growth in the province. Entrenching the Red Tape Commission and providing a mechanism for the review of the implications of government change is a progressive step.

Providing a competitive environment also requires that governments continue to recognize the importance of reducing the tax burden faced by businesses. The business community continues to report to government that the major obstacle retarding their ability to expand, create employment and contribute to economic growth are the various taxes present in Ontario.

We recognize the efforts this government's contribution in reducing taxes already, and encourage it to continue. Legislation such as Bill 140 and the Fairness for Property Taxpayers Act that preceded it work toward our mutual goal of allowing businesses to invest in expansion and jobs and not increased government.

Building on the successful fiscal management of this government in translating tax savings into jobs, the government may wish to consider a universal review of the various provincial sales taxes.

Providing for the basic medical needs of citizens is critical in developing strong communities. Many of the communities that we represent the interests of through our member chambers of commerce today are unable to provide this to their residents. We have the hospitals, we have the beds, the labs and in many cases the technology; what we lack is the physicians. Recruitment and retention of medical professionals has become an area of concern and thus activity for both NOACC and our member chambers. As we work to create diversity and growth in our local economies, we must include access to medical care as one of our primary infrastructure needs.

We believe the proposal to create a Northern Ontario Rural Medical School put forward by Laurentian and Lakehead universities will provide the north with the opportunity to attract and retain the medical professionals we require.

In the analysis of physician supply, mix and distribution conducted in 1999, the McKendry report details that Ontario must make a commitment to attracting students who are likely to choose rural practice and to providing the rural medical education they need to prepare them for such practice. And finally, Ontario should consider creating a new medical school in rural medicine, with a specific mission to attract students who are interested in working in the province's small rural and remote communities.

There has been extensive research conducted supporting these findings as a realistic long-term strategy to alleviate the chronic physician distribution problems in the north. This research further demonstrates that medical students with a rural background are more likely to choose a rural practice, and rural-based medical education produces more graduates who choose rural practice. This is best illustrated by the fact that less than 10% of all the medical schools in the United States produce over 25% of rural physicians. These 12 schools, located in rural areas, provide a rural-oriented curriculum and experience.

We know that this government, a government committed to not making convenient decisions for today at the cost of the right decision for tomorrow, will recognize this opportunity and make the necessary budgetary allocations for a Northern Ontario Rural Medical School.

In the short term, we have two further recommendations to the government related to increasing the quality of health care in the north. The first relates to the northern Ontario health travel grant system. The system currently is failing to meet the needs of our citizens. Traditionally, northern Ontario residents have had to travel great distances to see specialists. We now have communities in northwestern Ontario where such acute physician shortages exist that travel is required for primary care. Under the current system, only a small portion of the real costs of accessing this basic health care is covered. Thus, for many families in the north the concept of universal health care does not exist and they are forced to make health care decisions based on personal finances and not medical need.

As I mentioned earlier, physician shortages are so serious that even in the city of Thunder Bay 30% of residents do not have a family doctor. In this climate, it remains increasingly difficult to attract people to live in our towns and cities. We are, therefore, requesting that the government review the current designations under the underserviced area program.

Mr Beyak: Protecting and preserving the environment: Perhaps there may be no greater challenge in northwestern Ontario than in providing balanced and responsible usage of the vast natural resources we have in the region. The effective use of the natural resource base and the level of support for our industries that rely on these resources will dictate the future of our region.

We have been pleased to see the government's continued support of mining and adoption of our recommendation to reinstate flow-through shares. Throughout the north, exploration has increased, and we expect to see considerable job growth in this industry in the coming years.

While technological advances have allowed the pulp and paper industry to slowly downsize its workforce, the use of alternative wood has encouraged new industries to form and increased development in value-added products.

The traditional industries of northwestern Ontario will continue to be our major sources of employment and revenue generation. The government of Ontario should be mindful that it is Ontario's resource-based industries that will continue to, by and large, fuel the economy of our province.

We again thank this committee for travelling to the northwest and giving us the opportunity to share our vision of the needs of the north and its role in the future prosperity of this province.

I'll just add a couple of comments about the mining industry, for instance. It is absolutely crucial to continue to improve how this government treats mining companies. I had the opportunity to spend some time with a mining executive one afternoon in November. He said that Ontario is fast becoming the place to do your mining business. They have mines in Chile, in Indonesia and in the United States. They've just opened another mine here and they're looking at two more because of the way they're being treated in the province of Ontario; this, in contrast to the exodus eight to 10 years ago that was going on.

When you hear that mines are opening, you have visions of the land being ripped up and torn apart. These stats are a little dated, but we should know that the total disturbed surface in the province of Ontario, including quarries-that's gravel pits-is 130 square miles. What do we have? I think it's about three million square miles of surface in this province.

Everybody touts the automobile industry as a revenue generator, and obviously, by the dollar volume, it is, but for every dollar the auto industry generates, there is $177 spinoff, whereas with the mining industry, for every dollar they pull out of the ground, there is $262 generated. It is certainly a thought to keep in mind, when we have environmentalists or whoever saying that perhaps this mine shouldn't go forth.

One last comment: in the previous 10 years, the federal government has pulled out $2 billion a year in fuel taxes, $20 billion total. That's 20 thousand million dollars out of the province of Ontario, and they have contributed back $87 million-out of $20 billion-into the highways of Ontario. That's out of Minister Clement's mouth, a year and a half ago or two years ago, when he was minister.

The Chair: Thank you. I'll start with the government side. We have four minutes per caucus.

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Mr O'Toole: Very quickly; I might share, if someone else is concerned. I appreciate your presentation. Thank you very much. Between the three presentations, it was a pretty broad overview of the economic priorities within this region. It looks like transportation is a significant piece, besides the health issues, the shortage of physicians.

I want to focus on one piece here; it's on page 3. It says, "We believe that developing a common provincial-federal strategy through a labour market training agreement should ... be pursued." In fact, it is a very important issue, as you probably know. I think Quebec and Ontario are the only two signatories that haven't agreed, and it really has to do with the formula. My numbers probably aren't that accurate-I'm sure Mr Phillips will correct me if I'm overstating or understating-but I think we contribute about 40%, potentially more, to the EI fund, given that there's 11-point-something million people in Ontario sustaining a strong economy, probably 50% of the total economy.

Our argument is that we're only getting back a fraction of the-while believing that this is a nation and we should all contribute. I guess my point to you is to ask, is there any way we can pressure the federal government to make sure that Ontario-it's very important for Canada that it's strong and it remains strong. With the challenges, whether it's in medical school or whatever, the training dollar adjustment thing we're looking at is absolutely needed to support that intellectual infrastructure we need for jobs and future growth. Don't you think there should be a better formula, which recognizes a per capita formula? There are about 30 million in Canada, and about a third of them are in Ontario. We should get a third of the money, basically. Would you agree with that?

You're also affected, I'm sure, by seasonal conditions up here. The EI payout funds have been chopped.

Mr Beyak: That certainly has affected us. Where do you find a fair formula for funding? This country, federally, we seem to have an imbalance. I don't know how you correct it, other than through political means.

Ms Drysdale: The federal government has continued to provide for training for EI recipients in the traditional reach-back plans that we've seen in the past, but there are still some individuals who don't have access. I know that in your previous hearings, you've been talking about apprenticeships-

Mr O'Toole: Yes.

Ms Drysdale: -which have grown throughout our region. These are going to start to become critical issues. Even if we talk about an economic slowdown, it's a slowdown of growth; that growth is going to continue and we have to have the labour force. Whether or not the federal government gives us the exact formula we want, we as citizens need this training and we as businesses require the labour force, so something should be done.

Mr O'Toole: Are there other questions? I just wouldn't go on, other than just to make sure we use all the time.

Interjection.

Mr O'Toole: I guess that is the case: it's the share formula of the federal repatriation.

You mentioned a couple of programs which I want to commend you for: the OYAP, the Ontario youth apprenticeship program-excellent, very important. It should be supported, it should be talked about. It should be partnered with the colleges, and I'm sure it probably is here. That's the kind of infrastructure that will sustain growth. What I'd consider to be the real growth in the economy isn't really the GDP measurement; it's the value-added part, where you're actually adding productivity through knowledge.

Mr Beyak: It's appreciated.

Mr Kwinter: Thank you very much for your presentation. I'm really pleased that you've raised a particular issue, and it's an issue that I thought would be raised more often during our stay here in Thunder Bay. It's an issue that has really been given a lot of prominence, certainly in the Legislature by two of your local members, Lyn McLeod and Mike Gravelle, and that is the northern Ontario health travel grant. It's an issue where we've had delegations from this part of northwestern Ontario come to the Legislature to talk to us about the inequity of having patients in Ontario who require cancer care and have to go to a mid-north location having all of their expenses paid for by the government, whereas patients from the north coming the other way don't have that.

Notwithstanding the arguments that have been made and notwithstanding the presentations by people who have actually been disadvantaged by this, the Minister of Health consistently stands in her place and says that isn't true, it just isn't happening, that there is no discrimination, and the people in the north are treated exactly the same way as the people in the south. Could you just elaborate on that for me? Do you have any first-hand-

Mr Gilchrist: That's not what she said.

Mr Kwinter: That's exactly what she has said. She has said that on many occasions.

Interjection.

The Chair: We can have only one conversation at a time. I think the question has been put.

Ms Drysdale: I understand there are two different programs that we're talking about here. At the core of it, if there are people in southern Ontario making medical decisions based on financials, that's not correct anywhere in Ontario. What we're asking for is a review of the system, to look at the real costs for northerners to access the medical care we require, not only specialist care but, until we get this doctor thing fixed up, sometimes primary care. That has to happen in Ontario. As we invest in medical care, that has to be one of the priorities.

Mr Kwinter: Another thing I'd like to talk about is support for the Northern Ontario Rural Medical School, which I think is a great idea as long as it works. It's going to address sort of a subspecialty in medicine, which is to provide doctors who specialize in rural medicine. How are you going to make sure that is what the students who go there are going to do? Are you going to screen them so that only students who have a commitment to rural medicine get in? What happens if a student in southern Ontario decides, "I can't get into any other medical school in Ontario. I'm going to go there. I'm going to tell them I'm going to be a rural medical practitioner, and once I get my medical degree, goodbye, I'm going somewhere else"? Has anything been done to try to ensure that the facility that's going to be established is going to serve the purpose it's intended for?

Mr Beyak: The feeling in the northwest is, anything's better than what we've got. In my community, for instance-I moved there six or seven months ago from Fort Frances-I do not have a family doctor. If my wife broke her finger, she'd have to go to the emergency any time of the day or night. There are no doctors available. I think this is a problem throughout not only the province but the country.

Our hope is that coming to these northern communities, seeing the lifestyle, living with the people-I'm one who spent 25 years next door to Mr Phillips in Agincourt. I migrated down there from the north and then back out here again. Our hope is that once they experience the lifestyle and become part of the community, they will stay. If I'm not mistaken, this has been proven in Australia, the United States and several other countries that have tried this program. Certainly it's worth looking at. I also believe that, if possible, whether provincially and/or federally, there should be some incentive to practise in the north. We have to talk to the Canadian and Ontario medical associations about opening the doors-it's my understanding that's the roadblock here-to let more doctors in if they don't want to practise in these underserviced areas. You can't have your cake and eat it too. We're getting to the point that it's-"desperate" is the word I'd like to use. It's not a crisis yet, but it's desperate in northwestern Ontario and in many other communities throughout the north.

The Chair: That pretty well uses all the time. Mr Christopherson.

Mr Christopherson: Thank you for your presentation. It certainly is abundantly clear that you are big fans of this government. You say things as straight out as-and I'm quoting-"We know that this government, a government committed to not making convenient decisions for today at the cost of the right decision for tomorrow will recognize this opportunity" and on and on, and then on the next page you talk about "protecting and preserving the environment." But the track record of this government in terms of what they've done to the Ministry of the Environment-they've gutted the funding and gutted the staffing. The Ministry of Natural Resources, which I understand is really like the government for many people up north, has been devastated.

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Further to that, we've had people come in this morning and talk about the fact that your education system is in serious trouble, just like it is across the province. They're attributing much of that to underfunding. We had two mayors come in this morning and say that because of cuts by this government, they're going to have to look at either cutting services or putting in user fees. From where I sit, and how I look at the province-and I don't pretend to be an expert on the north-I've got to tell you that that's the last thing this government deserves credit for. You can give them credit for making a short-term decision-quite the opposite-and making sure they took care of their friends. That's fine. But to come in and make the argument that they've made the tough decisions and that they're going to-

Interjection.

Mr Christopherson: Do you mind? I listened to you.

Interjection.

The Chair: Order, please.

Mr Christopherson: But to say they've made the long-term decision-the next group is a group that represents people who are in poverty. They've been pushed further into poverty by the actions of this government. We've got the United Nations condemning Canada-and in large part that's Ontario, because that's where the large population is-for the way we're allowing more people to go into poverty during a time of expansion. Absolutely true.

Further to that, if you take a look, the only two provinces in Canada where there's an increase in poverty rates is us and Newfoundland. If you say something like that, you leave yourself open to at least a counter-thought. It's fine to come in and praise them, but I thought that was a bit over the top. The one thing they haven't done, in my opinion, is take steps that put us on a stronger course for the vast majority of people and certainly not for our communities, and that's where our sustainability is.

Now you can take your shot at me.

Mr Beyak: My only comment is that over the last five or six years we have seen increased economic activity. You can argue till the cows come home about whether lowering taxes is better or worse, but I know of no jurisdiction that has lowered taxes and not increased revenues. It's a science; it works. Any country or province that has done it has prospered. Again, it's hard for me to relate. In Dryden, Ontario, we have approximately 8,000 people and service an area of 38,000 people. We have one homeless person, and he doesn't want to get help. He just wants to do his thing, so we as a community kind of look after him.

I grew up and have invested in this province. I now have 47 employees. One of the major reasons I went through the expansion I did was that this government shows me where they're going. You may agree or not, but I personally agree with them.

Mr Christopherson: That's obvious.

Mr Beyak: I chose to invest a fair amount of money to make it better for myself but certainly the people around me as well. That's how it works in this North American economy. That's how it works. If you tax-look at BC and the other places; they're just bailing. Read Maclean's magazine, "Alberta Bound." It's there that people are going. They won't put up with it when a government starts taking more than 50%. I think we reached the point in this province. When combined taxes of 66% of my total income are going to various levels of government, people like myself say, "Enough."

The Chair: With that, I have to bring it to an end, because we've run out of time. On behalf of the committee, thank you very much for your presentation this afternoon.

Mr Beyak: Thank you. You can have close to half, but that's it.

THUNDER BAY COALITION AGAINST POVERTY

The Chair: Our next presentation is from the Thunder Bay Coalition Against Poverty. On behalf of the committee, welcome. You have 30 minutes for your presentation. Could you state your name for the record, please?

Ms Chris Mather: My name is Chris Mather, and I'm the coordinator for the Thunder Bay Coalition Against Poverty and also for the Lakehead Coalition Food Bank. I have been a social worker in Thunder Bay for 18 years. I've worked in the areas of health care, child welfare, psychiatric care, children's mental health. I set up the first child sexual abuse treatment unit in the north. I set up a wife assault unit in the north. I set up an elder-abuse unit in the north. I've given parenting courses to single parents. I've conducted marital and family counselling. For the last six years, I've worked in the area of alleviation of poverty. I've taught in three programs at our local community college. I'm on the board of directors of the Ontario Association of Food Banks and was invited to address the United Nations in Geneva on the issue of how well Ontario was meeting its commitment to look after the welfare of people in this province. Those are my credentials.

The coalition, which is known locally as T-CAP, has been in existence for about six years. We're an incorporated body headed by a volunteer board of directors elected by our membership-you know the way that works with community non-profits. At the last count we had about 80 members. The majority of our members and also of our board of directors are people who live on low incomes. That includes people on social assistance, people with disabilities, people who are aboriginals, students, people who are employed part-time and also the elderly. I'm just trying to give you some background as to who we are.

We have three primary goals. The first is to undertake non-partisan political activity to bring the concerns of low-income people to the attention of all levels of government. So the jargon for what I'm engaged in now is "non-partisan political activity," in case you didn't know. Our second goal is to provide public education about the reality of poverty. That's kind of going to the college and the university and teaching students there what it's like to live in poverty. Our third goal is to engage in co-operative projects with low-income people designed to ameliorate their circumstances.

The main example of co-operative projects is the operation of a food bank. Our food bank has been running for six years. We provide food to between 1,000 and 1,500 people per month. We also operate the Thunder Bay branch of the National Food Sharing System. Through this system we've provided over 59,000 kilograms of free food over the last six months to 13 other food banks, breakfast programs and soup kitchens in Thunder Bay and the surrounding areas. Just to put perhaps a less-than-rosy tint on the community of Dryden, I'll let people know that they've just opened their first food bank and we're soon going to be supplying them with food. I think there's more than one homeless person there.

Because of the nature of our membership and of the extensive contact with people we have who use emergency food suppliers, and because of my background and the background of the other social workers who work with us, we feel well able to comment on the living situations of low-income people in our community. I can tell you that those living situations are abysmal.

It's commonplace to hear talk about how Canada consists of two solitudes: Quebec and the rest of the country. It's commonplace, but perhaps it's true. Unfortunately, it is definitely true that the economic policies of this government have transformed Ontario into a province of two solitudes. I want you to take this very seriously; I mean this from my heart. I'm an immigrant to Canada. When I came to Canada in 1975, Ontario was not a province of two solitudes. There was not a big gap between the poorest and the rest of the province, and now there is. I mean this sincerely. Please take this seriously.

There are those who prosper and those who face poverty to a depth and extent that I, a social worker in this community for 18 years, have never seen before. Please take this seriously. You are people of power, people of influence. I'm an expert in this field. Perhaps that's being big-headed, but I am. Please take this seriously; it's very, very bad.

I'd like the members of this committee to reflect on the statistic I gave you a moment ago. At our food bank we provide food to between 1,000 and 1,500 people per month. Think about that. Now think that 40% of those people are kids. Now think that there are 29 other emergency food programs in this town. Six years ago, when you guys assumed power, there were four food programs, and now there are 29. You don't open an emergency food program for fun. It's very hard work. It's soul-destroying work. You go home at night crying because of the situations you hear of. People have opened those other food programs because people in this community are going hungry.

I've spoken to the federal government. No federal government department is willing to take responsibility for hunger in this province. They are signatories to the United Nations Declaration of Human Rights, which guarantees, under section 25, that people in this country will not go hungry. I've spoken to eight other provincial standing committees. Nobody in this provincial government is willing to take responsibility for making sure that people in this province do not go hungry. Your government is also a signatory to the United Nations declaration.

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Certainly our city council so far does not seem willing to take that responsibility either. Please listen this time. This is my eighth presentation. Please listen. People are desperately hungry in this community. I feel guilty if I go to McDonald's. That's what my life is like. That's what our social workers' lives are like. We feel guilty if we take our kids to McDonald's because we know there are kids in our community who are hungry. I hope you feel guilty the next time you take your kids to McDonald's.

Lest you think that I'm being alarmist here because I'm speaking very strongly, I have included a clipping from a local newspaper. It's talking about how a local soup kitchen run by a Roman Catholic church has been in existence for 20 years. The article states that the priest in charge says that over the last four years he has noticed a steady increase in people using the soup kitchen. He continues to say the reason is simple: cutbacks. With the provincial government cutting back on social services and welfare spending, more people are relying on organizations like the Dew Drop. It's called the Dew Drop and it's kind of a hokey name, but they give great service. They're one of the people that we send free food to.

I talked about this being a province of two solitudes and, believe me, I chose that word with care and I believe it's absolutely apposite. We say "solitude" because we do not believe that this government is listening to the concerns of low-income people. The low-income people we serve do not believe that the government is listening to their concerns. We try to be a great organization, so we do these consumer satisfaction surveys at our food bank, you know, to see how well we're doing. Sometimes we ask them how well they think the government's doing, and the last time we did that 85% of them said the federal government didn't care that they were hungry; 63% of the people said they didn't think city council cared that they were hungry. Now get this, guys: 92% of the people who answered our survey said the provincial government did not care that they were hungry. Some 92% of the people who come to our food bank don't think that their provincial government cares that they're hungry.

Certainly in six years of making similar presentations to other provincial standing committees and seeing the briefs presented by other groups, I have noticed no attempt to address these concerns, unless you call a more stringent welfare regime, self-congratulatory government publications mailed to private households, downloading onto municipalities and what can only be a blatant campaign of scapegoating of people on social assistance addressing the cries for help from the poor. That's what it is: it's cries for help; it's real.

I know it's not easy to think of our province becoming divided along economic lines. I know it's not easy to speak harshly to government members. I know it's probably not easy to listen politely to me criticizing your party's policies. But I can tell you it's immeasurably harder to watch a senior citizen walk 12 blocks in -30˚ weather to come to our food bank and get a tiny amount of food and watch the icicles that have formed on their eyebrows start to melt as they come into the warmth of the church basement. It's sickeningly harder to listen to a single-parent mother tell me how she's meeting her food budget by prostituting herself with her former abusive partner. This very civilized ex-partner of hers worked out a sliding scale for her; you know, so much if she gave him oral sex, so much if it was straight sex, so much if she spent the night with him.

It's devastatingly harder to turn these people away empty-handed, because we're running out of food in this community. More and more food banks are turning people away because we just don't have enough food. It's a harder task than I'm capable of fulfilling, despite all my experience, to provide any real measure of comfort to the staff and volunteers, who are crying because they don't have enough food to give to people.

There, that was the emotional part. We can all breathe again.

I'd like the members of this standing committee to listen to the following five measures, which, if they were part of the next budget, would begin to address the concerns of low-income people:

(1) Food bank use has doubled over the last 10 years. There are now 270 food banks in Ontario. People are using them because they don't have enough money. One of the first actions the government took was to cut social assistance payments by 22%, and at that time the amount left over was inadequate. It was already said today but it bears repetition: in real dollars, welfare benefits are close to the lowest they've been in 35 years. You've achieved a budget surplus, and it's now time to address the concerns of low-income people by spending some of the budget surplus on an increase in welfare payments.

(2) Five years ago the government stopped building social housing. Thunder Bay lost 13 social housing projects at that time. When heating costs are factored in, we have the second highest shelter costs in the province. We've just found out we're having a 6% property tax increase, and that will be passed on to tenants by landlords.

I remember very clearly being told at a government hearing that it was time for the government to get out of the business of building homes and let the private sector take care of things. There was no doubt in my mind then that the private sector was not going to build low-rental housing, and it turned out I was right. It's now harder than ever for poor people in Thunder Bay to find safe and affordable housing. A recent report said that there are now 3,300 homeless people in our community. It is time now to address the concerns of low-income people by spending some of the budget surplus on building social housing.

(3) In July of last year, I and representatives of five other food banks from across Ontario met with the Minister of Community and Social Services, and we told him that the shelter allowance portion of social assistance was inadequate. I won't give you the statistics; Sarah Colquhoun already gave them to you.

We told him that people were regularly going without food in order to pay their rent and/or their heating bills. He expressed great concern. We sat there in his fancy office and we all had coffee and we were all very polite, but I genuinely believed that he was concerned. Now I would say it's time to translate your minister's concern into spending some of the budget surplus on increasing the shelter portion of social assistance payments.

(4) This government has given large tax cuts to the wealthy and smaller tax cuts to average-income families and it's clawed back the federal child tax benefit from people living on social assistance, which means that the poorest families in Ontario have not received a federal benefit intended to fight poverty. Sometimes I do public presentations and when I tell ordinary citizens, ordinary taxpayers, that the federal tax benefit is clawed back from people on social assistance, they're horrified. I tell them what Ms Molinari related about the programs that's being spent on, and the people I present to think that the people should be getting the money. We have a big sign in our office. It says, "I don't need therapy, I need money."

It's time for the provincial government to stop clawing back this money and thereby address the concerns of low-income people.

(5) There has not been an increase in the minimum wage since 1995. It's time now to address the concerns of low-income people by increasing the minimum wage.

I thought I'd tell you what you'd get if you took these five measures that we're suggesting.

First of all, you'd get a lot more money going into local economies. People on low income spend their money in their local communities. They don't take trips to Florida in the winter.

You'd get a good saving in long-term costs, because it's well established that people who grow up in poverty cost the health and education systems a great deal. So you'd get a good, long-term saving there. Mr Christopherson was saying that this is a government that hasn't looked ahead. You could look ahead and make some savings in the long term for health and education.

You could say, "Yes, we listened. We took some action to alleviate poverty. We listened to the concerns of low-income people. We stopped our province being split into a place of two solitudes."

I'm an immigrant, but I love Canada. You can tell I'm from England, right? It's three thousand times a better country than England. Let's keep it that way. Let's not let it split along class lines the way England is. If you've ever lived in England, you'll know it's very much a place of us and them. Let's not let our country become us and them.

In summation, we believe that the gap between the rich and the poor in this province is growing ever wider. We believe that it's time to start decreasing that gap by increasing welfare payments, increasing the minimum wage, investing-and it is an investment-in social housing, and by stopping the clawback of the federal child benefit.

Thank you for your attention to this presentation.

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The Chair: Thank you very much. We have four minutes per caucus, and I'll start with the official opposition.

Mr Phillips: Thank you very much. I appreciate all you've done personally and your presentation. I wish I could be very optimistic. In the month of December we tried to get the Premier to act on the social assistance rates and were unsuccessful. It doesn't mean we'll stop trying.

I want to focus a little bit on the housing side of it. In Ontario I think we need between 15,000 and 20,000 rental units built per year. We've seen maybe 1,500 built per year in the last five years. There's a huge backlog building up. There are some condos being built that are being rented out, but that's short term for investors' purposes, I think.

The reason that I'm focusing on housing is just because it gives us a chance to understand the situation here in Thunder Bay. You point out that you feel there may be as many as 3,300 homeless people in Thunder Bay.

I think the government at the time said, "The private sector will build rental units and we'll give some shelter allowances and it will all be kind of fixed." We had the homebuilders in, the people who build these things, and they essentially told us that they're not going to build them because of the fear of rent control. They get a bigger return on their investment elsewhere.

My question on the housing side is, of the 3,300 homeless people in the community, where are they? Are they living with relatives? How are they actually spending tonight?

Ms Mather: There are a percentage of people who during the summer and the spring and fall actually live outside. Sometimes you go down to the overpasses over the railway line and you see these pathetic little communes where they've even tacked up pictures out of magazines to make it seem like a home. Come winter in Thunder Bay that's not possible. We've had some people freeze to death in Toronto. We've had people freeze to death up here, but it's much rarer for people to freeze to death up here because it just isn't possible to live outside up here in the winter. So they're at the shelters, which are overflowing. People are living with relatives. People are for part of the time living in scuzzy motels. They're living in battered women's shelters. Sometimes the Salvation Army will pay for a couple of nights in a hotel for a woman with kids.

Mr Phillips: Certainly in my community, of the issues that I get, this is a growing issue of desperate people with literally nowhere to go. What is the situation in terms of the building of rental accommodation in Thunder Bay?

Ms Mather: From my awareness, it's at a standstill. The housing that's being built are really nice, fully detached homes in very nice subdivisions. We have a vacancy rate. We do have rental properties here in town, but they're well above the rent that people on social assistance can pay. We need more low-income housing. I guess we could ask the government to subsidize units in for-profit buildings. That used to happen.

Mr Phillips: Have you raised that issue with the ministry at all?

Ms Mather: I raised that issue with the Minister of Community and Social Services, yes.

The Chair: With that, we've run out of time, Mr Phillips.

Ms Mather: Thank you for your question.

Mr Christopherson: Thank you for your presentation. I wish the previous presenters could have stayed just so they could hear the other side of the discussion. I thought it was interesting, because the government members are next and I have had on occasion, both formally and informally, different members of the government caucus-I won't mention any names; that's not the point-who will argue that there aren't that many poor people. I think an earlier presenter talked about one in Dryden, and then you came in and said, "I'm not sure what that means. They've just opened up the first food bank and we're going to be helping them." I would just say to the government members, if there's anybody who wants to argue that it's a growing problem, that they be the first ones to line up and take on a Roman Catholic priest who says he's noticing a steady increase, and then he's saying, from where he sits, it's directly attributable to cutbacks. Again I say to the government members, when you hear the United Nations condemn us for allowing poverty, especially child poverty, to continue to grow, at some point you've got to ask yourself, "How much longer can I live with the fact that our government policies are contributing to this, especially since we just went through the boom?"

You know what's going to happen now. Now every time anybody comes in, if the downturn continues, it's going to be, "We can't do that now; there's not enough money. We can't. Things are bad. We've got to cut back. We've got to do this and that." That was our fear all along: if we couldn't get them to spend the money in the good times when it was there, we're never going to convince them to spend it in the bad times.

Two questions, really. I wanted to ask you about the experience here in the north to see if it's the same as it is in the south in terms of the relationship of the lack of adequate shelter allowance for those who are on assistance, the reduced availability of affordable housing and the increase in food banks. Down south there's an equation there. You can see it; it works. I just wonder if it's the same here.

My other question would be, in terms of the people visiting the food banks, is it only those who are on social assistance? Are there the working poor, are there seniors, or is it primarily those who are on assistance?

Ms Mather: Your first question was, are people using food banks because of the cuts?

Mr Christopherson: Yes. Is there a relationship?

Ms Mather: Yes, there is. When we ask people that, they say they are coming to the food bank so they can pay their rent. Everybody takes care of their shelter costs first. It doesn't matter how rich or how poor you are: you take care of your shelter costs first. When you're on social assistance, the only disposable income you've got is your food budget. So that's exactly right. On average, we're thinking that about $150 from the basic allowance is added to the shelter costs. That's $150 a month for a single mom. For a single person, the amount that's transferred from budget to budget is considerably higher. I'm sorry. I'm desperately trying to remember that stat, but I'm nervous and I can't.

The second question I think was-

Mr Christopherson: Who is visiting you? Well, not visiting-using.

Ms Mather: Using the food bank, yes. The highest percentage of people who visit are people who are aboriginal. It used to be only people on social assistance, but now we find that we're also seeing a great many seniors and people who are living on the Ontario disability support plan. We're lucky in that the church that lets us use their basement free has one of those disability lifts so that people in wheelchairs can get up and down.

What's most distressing is that we see a lot of kids coming to the food banks with their parents. What that means is that that kid isn't going to school that day because the parents didn't have lunch to send with the kid. What I really hate, which we see more and more of, is people come in and they open their package of food immediately and they start to eat it there and then. You know that people are hungry right there and then because they're opening their package and eating it.

I'm sorry, Mr Christopherson. I don't say "the working poor"; I say "poor people who have a job," because all people work. If you work in the home, you work. I don't like the term "working poor."

Mrs Molinari: Thank you very much for your presentation, and congratulations on all your credentials that you stated at the beginning of your presentation. It certainly sounds like, with everything you've done and all the work, you have a lot to say for the work that you do and the people you serve and represent.

Just some brief comments on some of the points you've made. On the national child benefit, as I indicated in a former presentation, the provincial government has reinvested into the Ontario child care supplement for working families. Out of the $100 million in 1998-99, the Ontario child care supplement for working families is bringing it up to the total value of $200 million annually. That means, to single-parent families with young children, up to $1,310, and for dual-parent working families the annual benefit is $1,100 per child under age seven. So it is being reinvested. I know you've indicated, as did the previous presenter, you would like that to be given differently.

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Ms Mather: Can I respond to that? It is given to working families. By definition, people who are on social assistance are not employed or are underemployed. So the money that citizens and taxpayers think is going to help the very poorest children-everybody is concerned about child poverty, and I'm sure you are. The money that's supposed to go to the very poorest children whose parents don't have a job, whose parents are living on the rock bottom of the social safety network, aren't getting it because they don't have jobs. Do you understand my point better now?

Mrs Molinari: Yes, most certainly. The article you've given us is interesting. A lot of work is done by the Catholic Church, and certainly it's part of their mandate to reach out to families and to the needy. The soup kitchen, by way of the headline, has been in operation for 20 years. It's 20 years old, so it's not something recent. It's interesting that some are regulars who have been going, I guess, for the last 20 years.

Certainly there is a concern whenever there is an increase in the need for something like food banks or soup kitchens. As a government we have made a number of initiatives in the area to serve, and certainly there is a lot more to be done. It's a systemic issue, a problem not only in Ontario but I'm sure in a lot of other countries. It's a challenge for any government to address some of the issues.

I do believe, though, and I would ask your opinion, that it's not just a provincial government problem to be addressed. It's something that needs to be addressed by all levels of government. I appreciate your making presentations to other levels of government, trying to get the message across to them as well that we need to work in co-operation in order to address some of the systemic problems that exist in society. Certainly poverty and homelessness are some of the issues we need to address and work together on.

Ms Mather: It's great that you appreciate my presenting to other levels of government, because they don't seem to appreciate it at all.

What I would say is, yes, you're right. Because of the religious philosophy of the Roman Catholic Church, they have always reached out to the hungry, through things like St Vincent de Paul. But I would say that your government also has a responsibility actually and is not doing enough.

I would also say that, yes, some of the responsibility for the increasing levels of hunger and poverty in our community most definitely falls on the federal Liberals, because they got rid of CAP, the Canada assistance program, which allowed your government to do away with some of the standards for social services that were there.

I kind of see what your government has done and what the federal Liberal government has done have kind of worked in tandem to create this situation. So I don't think we can really say the province is let off the hook by saying, "The big old feds did it first."

The Chair: With that, we are out of time. On behalf of the committee, thank you very much for your presentation this afternoon.

Ms Mather: I just want to say I'm glad you guys are back in Thunder Bay. It seems like over the last three years we've had no provincial hearings up here. We thought you'd forgotten us.

ANNE SCHEFFEE

The Chair: Our last presenter this afternoon is Anne Scheffee. Could you please come forward and state your name for the record. On behalf of the committee, welcome. You have 15 minutes for your presentation. Please make yourself at home.

Mr Phillips: On another matter, I asked a question earlier. Mrs Molinari-

The Chair: I have it. I'll read it into the record after.

Mr Phillips: That's fine, thank you.

Ms Anne Scheffee: I want to thank you for having me here. It means a lot to me.

My name is Anne Scheffee, and I'm here today to leave an impression of how I feel improved financing to the Thunder Bay Regional Hospital maternity ward could impact the mothers of our city and their families. I will do this by reading a letter I wrote to Nancy Persichino, the director of maternal services here in Thunder Bay. Following this, I will prove that I have taken an active role in initiating immediate improvements for our mothers of the city. Those mothers come from all walks of life, working and non-working. Of all the ones I've talked to, many don't want the things I've asked for today, but the majority do, so everyone is going to be different. If it's available, they've got options, and that's how I will start this. It will hopefully be clear now how any increase in cash flow to the hospital will greatly provide the difference in the overall health of our families.

I'll go to the letter now, which everyone should have a copy of.

"Dear Nancy:

"As per our telephone conversation, I am writing with details of my personal experiences throughout my two-and-a-half-day stay on the maternity ward. I was offered a visit from the Thunder Bay health unit"-after the baby was born-"and I used my time with them to voice my opinions on some of the issues.... They requested that I write these concerns/suggestions to you. They valued what I was saying and suggested I could help improve the existing system by taking the time to write. I will compare my second experience in childbirth to that of the first"-three years ago-"at the birthing centre. Please feel free to use only what you want from these lists to make the maternity ward experience as comforting as the birthing centre one was."

If I'm talking too fast, please let me know. I'm a little nervous.

Mr Phillips: You're doing great.

Ms Scheffee: "I am a large advocate of breast-feeding and I feel that any modifications made in that area of concern would increase the chances that more mothers will make the commitment to breast-feed and will have the confidence to endure. In addition to that, most mothers will focus on the true blessing of childbirth instead of focusing on negative memories and on their own insecurities."

I am currently a member of Our Kids Count, the federal government initiative. I can see that from birth to the older child, it's really important that we do what we can, as the government and as people, to make it better for those children. I've seen people who have no money, and just from talking to this other lady, some of that welfare, some of them could use their money a little bit more wisely, but other ones are really in desperate need, so it's very interesting how this all goes together. Anyway, back to my point.

(1) In the birthing centre, I had a one-on-one nurse at all times and a 24-hour stay only, so I was more comfortable in my own home, faster.

(2) I had a home visit prior to labour by a nurse. I had a chance then to air concerns and I was reminded to bring lots of underwear to the hospital. That's going to be important later in my letter.

(3) The birthing centre allowed me to come in and learn how to use the gas mask prior to labor to reduce anxieties.

(4) A nurse checked labour progress at the house, instilling my confidence and getting me in on time. There was a little problem with blood pressure and it was caught right away.

(5) The quality of care was astronomical.

(6) I had friendly, caring nurses who took special time with me. This is in February 1998, by the way, that I was in a birthing centre.

(7) Nurses really listened to me during labour. They gave options and suggestions as we went along.

(8) There was a Jacuzzi right in my room.

(9) There was a home environment, which was less stress for me.

(10) I was given explanation of what next to expect during my labour stages.

(11) The nurses displayed optimism and happiness for me throughout labour.

(12) I was never left to feel overwhelmed. I was provided a rundown of each progression, given in an environment that was very warm and kind.

(13) I was given warm blankets by the nurse upon entering hospital.

(14) I was given the opportunity to walk the halls during the labour.

(15) I was given support to ensure my comfort during breast-feeding, ie, pillows, extra feeding options; all the information I needed about expressing the first six weeks.

(16) I was helped out of bed and to the washroom when necessary, the first night of birth.

(17) I was offered a snack right away.

(18) I was helped through mental anguish of hearing another labouring woman.

(19) I was given explanations of what to expect while back at home.

(20) I was shown how to bath the baby and what different cries meant.

It seems pretty down to earth, but the thing is, if you've never had a baby or you've forgotten from the first childbirth, it's almost like starting again and you need those extra nurses to help you through that.

(21) I was given home care for one week after my daughter was born. The baby and I were checked regularly during that time; great mental relief at postpartum period.

Back in the earlier days they used to keep you in the hospital for a week, so any problems would have been picked up. Now, obviously, we can't afford to keep moms in hospital for a week, so you go home and you take your chances with infection.

(22) Nurses are great as midwives but in the birthing centre the doctor still delivered baby, which to some women is the greatest of peace of mind, including myself.

(23) I was helped several times during breast-feeding to ensure confidence.

I wasn't just checked once to see if baby was latched on. I was checked almost every hour in a 24-hour period, and I kept track of that.

(24) I was checked at home for engorgement and encouragement to breast-feed was continued.

(25) I was helped with my concerns about my child's jaundice. I could see it going away, with the nurse's help.

(26) I became very close to nurses very quickly.

(27) I instantly was overjoyed by baby and stopped focusing on my labour.

(28) I was given a hospital book and pamphlets to take home, and I reviewed with the nurse different sections of the book and different breast-feeding ideas and concerns.

This is the maternity ward experience that I experienced three months ago. I wrote this while I was in postpartum but the letter, I feel, is still very important to point out the differences. Now I'm not in postpartum, so I hope it's taken seriously.

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The nurse listened to me about induction concerns. Number one, induction is a whole different experience from the birthing centre right there, but just the coldness of the environment compared to the birthing centre was unacceptable. Induction is bad enough without everybody rushing around and not with you because they don't have the money to provide a nurse to be there the whole time. So the nurse did listen to my concerns but told me I shouldn't concentrate on machines, only labour. I needed to know I was going to be informed as my labour progressed. The nurse was very, "OK, are you ready? Can I put this in now?" It was very like this: knocks twice on table.

Preparation for induction only came because I phoned Nancy. No counselling was given to me on what to expect. I phoned her because I knew her from the birthing centre. She happens to now be the director, so I was very lucky to feel free to phone her.

The nurse I had was a good listener and very professional. That's the point. Some people don't need that. I needed a more friendly, comforting approach throughout my labour experience. Again, that's my preference. Maybe someone wouldn't have minded her going in and out and rushing me, but in my case this was a very hard thing to deal with, not having a nurse the whole time, a good nurse who could sit there and hold my hand.

The nurse came in only when the bell went off. There was a bell and it made me feel like a number; because I didn't know what that sound was I was extremely nervous. You're already being induced at two minutes apart; you don't need a bell going off, and this had been discussed with Nancy. But part of the point of this is that they don't have the staff to be there, so they're using a bell; they're using a computer for the safety of the child and the mother. They're not looking at the mental health of the mother at all.

Ice chips were offered during labour, no warm blankets. I don't know if they would have been appropriate in an induction, but it's something I remembered from the first time that I didn't get the second time. The ice was offered by my aunt, who was my support person. I didn't hear from the nurse. I had to ask her for that. Labour was very quick, so there were no relaxing techniques. There was never a shower offered. No one even thought of that. The nurse finally did allow my coaches to read the monitors, because I was getting so nervous about them. That gave me back some control. I asked for gas at some time into labour. I was an hour and a half total and I think at one hour I asked for the gas, and at that point I was given it. But I think at two minutes apart, when that machine went from the five minutes that they initiate down to two instantly, I should have been offered the gas right there. But the nurse again was gone. She had to do whatever she was doing. I have talked to Nancy about that and I was told that I did have a one-on-one nurse. My aunt and my husband couldn't believe it when they heard that, because we never saw her except for when that bell went off.

I was surprised there was no chair right in the room, with holes in it for the contractions, no birthing ball, no squatting bars for easier pushing, although I never had a problem with that part, obviously, for an hour and a half; it was that quick. It's something I didn't see in the room. My aunt is a nurse from many years ago and she didn't see anything like this either.

Unlike the birthing centre, there are no home visits after a maternity ward labour; there's no after-care. You go home and you're alone. That's it. You're up to yourself. It's up to you to do the things you need to do. You can go with the midwife if you want, and we'll talk about that in a minute.

There are no walk-through appointments offered to meet the nurses before your induction and, again, no relationship is formed.

The doctor told me I had clearance to request an IV for the prevention of strep B going to the baby since I felt nervous about having strep B, as my daughter had it. At the time that the induction was beginning, I argued with the nurse; I asked her to please put it in. She didn't go get the doctor. She was in a hurry to put it in. She stood there and said, "You're not a high risk. You're not early; you're late. It's not necessary." She and I argued back and forth and I never did get my way. I never got the needle in my arm-so of course, mental anguish for a mother just about to be induced.

No real encouragement from the nurse or doctor during labour; I never saw my doctor, and that could be because he thought I would be worried about seeing him. But the nurse-never any real encouragement. The only thing, at one point I pushed against her just before the baby came out and that's all I can remember about her ever being near, other than checking, and that was about it. Again, no relationship. I don't even know my nurses' names. That's how terrible-I remember every single one from the birthing centre and I was only in there for 24 hours.

I was left on my own to get out of bed the first night. I did plan a private room, thinking I was going to have the kind of care I had at the birthing centre as far as nurses coming in and talking or something, but I was completely alone except when they checked my temperature and to take the baby away to get checked.

There were no chairs with holes in them in my room either for the painful stitches. I was not told about anybody coming in at 6 o'clock in the morning for breakfast. They were there very early. I can't remember what time, but there should have been time when a nurse could have talked to me, "This is what's going to happen while you're in hospital. You've never had this experience. The birthing centre is different." No one ever talked to me about anything. It was very cold.

My panties had soaked through at 8 o'clock the night my son was born because nobody told me there were adhesives on the pads, and when I did find out I'd already lost two pairs of underwear. The third one, even with the adhesives, wasn't enough because I was in such pain with my back, from the induction, that I was getting up and down just to walk, trying to avoid the pain. The result was that I ended up bedridden for 16 hours.

There's a letter that I'm not going to read, but I will explain what I've done about that situation because I thought that was completely unacceptable. I will explain what initiative I took, as I said, at the beginning.

I felt cheated from induced labour but no one had the time to talk about the disappointment I was feeling. No counsellor was offered, and my comments were taken lightly. I was told, "You'll be fine. Aren't you happy to have a nice, healthy baby?" I felt almost guilty for mentioning it in the first place. No one had time to talk; they were in and out and that was it.

I was told by a nurse that she was surprised that I didn't know about some baby care. She didn't take the time to tell me. She basically said that and then walked away. It was in regard to bathing a baby, as my son was getting circumcised, and I wanted to know about that. They ended up taking heat and helping me with that. The comment that I got, because they were so busy they had no time to listen to me, was just devastating. I was only reminded on how to bathe a baby because I asked permission to look over at another mother in the nursery.

I was not given any sitz bath information. In the birthing centre they have a toilet, it's called a bidet, I guess, that sits on the ground. In this particular situation it was a portable one, and I'd never seen one before. I didn't think to ask about it until I was about to leave the hospital and phoned the nurse, and she said, "Oh, that's a bidet. You'd know that from the other place." No, I'd never seen anything like it, so I didn't get any sitz baths the whole time I was there because no one noticed that I hadn't had one. That was pretty frustrating.

I was having trouble with the baby eating more than my daughter did, and when I showed some discouragement the nurse at the front desk said, "Well, this is where we offer supplementation." That was it. She never said anything about, "Can we help? Is there something we can do to help you through this so that you can keep breastfeeding?" There was absolutely no help there, and I was surprised that they suggested that. I walked away and I kept persevering and I am still breastfeeding and it's been 17 weeks. I definitely believe in it, as I said. If there was a little bit more money for the care, I think the nurses would be listening more to their patients.

I was not given anything except the Caring for Mother and Baby book when I left the hospital. A breastfeeding pamphlet for support had not been given to me, and I became engorged two days later. I was misdiagnosed with mastitis. I had no nurse coming back to the house so I got very sick before I realized I was sick. One week later I went to emergency and got diagnosed with mastitis. There was a hard lump and I could hardly get the milk out of it. I was very sick. I had a temperature and everything. I was given drugs for mastitis but I was told to go see my specialist. The next day I went and he took me off them, but by then my son had a rash. So I was misdiagnosed there. There was just milk fever, a backup of milk because I expressed too early and I expressed too much and I expressed incorrectly. There were three reasons why it happened. Had a nurse been there to help me with that, like they were in the birthing centre, I would have been fine.

I didn't have mastitis with my first and I was just as big and I had just as much milk. The book from the hospital didn't show the difference between the two conditions. I did use the book that I got, and the book mentioned mastitis treatments on page 57-I didn't bring a book and I apologize for that-but point 65(a) said that with mastitis you should let the baby drink for shorter, more frequent feedings, while point 65(f) said that the baby should feed from the infected breast as long as he or she wants. So there was a contradiction there.

Between the doctors having different opinions, the nurses sending me away when I approached them, not only during the beginning of the breastfeeding but also when I had the lump-I went up there first and they sent me away again to go to emergency-and the third, the book having contradictory points, I was ready to give up breastfeeding.

Thank you for your time hearing me comparing these important points from the experiences of my labor and delivery. I hope you can take some of this and help better merge the birthing centre experience with that of the maternity ward. I think people will walk away from the hospital feeling confident and happy in their new role as parents.

The second letter I'm not going to read, but I'll tell you what it was. I guess I was a little bit too thorough here in this letter and I don't want to go there. Anyway, I basically wanted to say that because I had done wrong on my protection pad, I lost two pairs, and on the third time around I was really bleeding a lot and I couldn't walk. With an induction of two hours it's like getting hit by a truck. I've been hit by a truck, and the pain was comparable.

1640

The induction itself was just terrible, but I breathed through the whole thing and I did what I had to do to get through that, but even the after-effect is like you've been hit by a truck. You're sitting by yourself trying to get to the baby, you're trying to get to the washroom, and you're in terrible agony. All that felt better was to walk. Because this happened with the Depends, with no extra underwear at that point, I had to be bedridden for 16 hours. I did call the nurse and I asked for a pair of underwear, knowing that mine had been soiled. I had called my husband, who was just putting our two-year-old to bed so he couldn't come down. In the end I asked for a Depends product, some kind of a panty that I could put the white pads into-because the hospital does supply the pads, but these things are actual underwear-and they said there was none available for moms, "Sorry, you're lucky to get what you have because in the States they pay for everything."

So I said, "Could I have a Depends product from the senior citizens' ward?" She said, "I'll do what I can." This was at 8 o'clock at night and by noon the next day I had a Depends diaper. I was bedridden for 16 hours because they didn't have the staff to run upstairs two floors for me. That's a pretty horrifying experience for someone who has just been induced, as far as I'm concerned. I have talked about it.

Of course I took the initiative, because that's who I am, and I wrote Kimberly-Clark, because I just happened to get a Depends thing in the mail for the senior diapers. I wrote to them and I asked for 1,700, which is approximately the number of births that Dr Holloway said we have in Thunder Bay a year. I don't know if that's regular doctors, but specialist deliveries for sure are included in there. Kimberly-Clark has provided-and I gave them to Nancy at my meeting last Friday-300 Depends products for moms so that they can put the white pads in if they run out of their underwear; they have a backup.

In summary, I feel I've worked hard to make a difference for new mothers. I feel the little red wagon program the provincial government is initiating should begin by taking care of our mothers. I ask that you take a moment before the budget of 2001 is established to consider what a significant difference your role can make. A mother who is healthy and satisfied brings joy, love and warmth to her newborn and radiates that same warmth to the family waiting at home.

Sometime following his election of 1935, Tommy Douglas, the father of medicare, said, "It's not too late to make a better world." It is my belief, therefore, that if we use the same energy as Tommy did to create change, have the same integrity as he did and are as committed to the cause, we together can make our families healthier and happier.

Going along with the children, just from having a newborn and my husband working till midnight, there are days when you feel like shaking that newborn. If you've got that support from the hospital and the nurses, you won't get to that stage where you feel like that.

Going forward, I ask that you focus on mothers, the reason we all are here today.

The Chair: On behalf of the committee, thank you very much for a very interesting and somewhat unique presentation of those that we've had over the past four days. Good luck.

Ms Scheffee: Thank you very much. Do we have any questions or anything?

The Chair: Does anyone have any questions? We had 15 minutes allocated.

Ms Scheffee: Has it been 15? I apologize.

The Chair: No, it's OK.

Mr O'Toole: Just for the record, actually, as a father with five children, I appreciate the desperation you must sometimes feel when these things don't happen the way you planned.

Ms Scheffee: I never shook him, by the way. I walked away and read my book from the hospital. So thank God for it.

Mr O'Toole: That's good. It's certainly a lot of pressure in families in that sense.

I was just wondering, though. I thought the province had the initiative of actually increasing the stay in hospitals for newborns and they've increased the home visits. Now maybe it's just the firstborn, I'm not sure. But there has been a significant amount of emphasis on the whole process of birth and mothering, and not just Ontario's Promise. You mentioned the red wagon thing, which is part of it. So I'm sort of disappointed. It sounds like a delivery problem in a way, not delivery of the baby but a site problem.

Ms Scheffee: I think it's the big picture of the lower staff. I have talked to Nancy and she said that some issues were financial, but many of them are using the money that you've already given them and changing it around. She's going to take my letter, by the way, and move it into many of their nurses' meetings. They're going to be doing some extra training. But that takes extra time, which again is pressure on the budget.

I guess I don't have a lot more to say except that if there's any room for improvement, you'll see how important it is to mothers and the kids. Being in Our Kids Count through the federal government, I see those moms. A lot of them are single moms out there and when they have two, I can see that's where child abuse comes from, right there, because you don't have any support. You have no husband. You have no one coming home at midnight. You're done. So if you don't have that nurse coming home for a week after-maybe they could have offered a counsellor. That alone, if they'd taken 20 more minutes, if they'd had the time to offer one more nurse that night, because I think there were 17 babies-but don't quote me-if they'd had the extra time just to talk to me, maybe there would have been more help there.

Just one last thing: in the birthing centre I had a nurse for nine hours at a time going through all this. In the induction, the nurse wasn't there a whole hour and a half. I asked an hour and a half with her. I got eight hours at the birthing centre and I only got an hour and a half this time, because they had a whole bunch of other mothers who were getting induced at the same time. She needs to be there; she needs to do her thing with the doctors. She may be just my nurse but she's got other work she has to do because the other nurses are being called to the other rooms. So if we could just get funding for one more nurse per day, or whatever, that could be all it would take, or a little bit of money for education, something, just something extra.

The Chair: Again, on behalf of the committee, thank you very much.

Mr Phillips, you had requested from Ms Molinari some information after a presentation that was made this afternoon. Here's the information that was given. I'll read it into the record. It says, "Ontario's welfare rate for a single employable person is 34.7% higher than the average of the other nine provinces, according to the National Council of Welfare, an arm's-length agency of the federal government." That's for the record.

With this, I think that concludes our presentations today. This committee will adjourn until 9 o'clock on February 19 in Ottawa.

The committee adjourned at 1647.

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