Committee Transcripts: Standing Committee on Finance and Economic Affairs - 2001-Feb-20 - Pre-Budget Consultations

Pre-Budget Consultations
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PRE-BUDGET CONSULTATIONS

LONDON HOME BUILDERS' ASSOCIATION

UNIVERSITY OF WESTERN ONTARIO

TOGETHER IN EDUCATION

LONDON CHAMBER OF COMMERCE

INVESTING IN CHILDREN

LONDON AND DISTRICT
LABOUR COUNCIL

ADVANCE LONDON

THAMES VALLEY CHILDREN'S CENTRE

ALLIANCE OF CANADIAN
SECOND STAGE HOUSING PROGRAMS (ONTARIO CAUCUS)

LONDON MUSLIM MOSQUE

ELEMENTARY TEACHERS' FEDERATION OF ONTARIO,
THAMES VALLEY LOCAL

INTERFAITH SOCIAL ASSISTANCE
REFORM COALITION

ONTARIO BUSINESS NETWORK

LAMBTON KENT DISTRICT
SCHOOL BOARD

ONTARIO SECONDARY SCHOOL TEACHERS' FEDERATION, DISTRICT 10

ASSOCIATION OF COLLEGES
OF APPLIED ARTS AND TECHNOLOGY
OF ONTARIO

F-25 F-25

ISSN 1180-4386

Legislative Assembly Assemblée législative
of Ontario de l'Ontario

First Session, 37th Parliament Première session, 37e législature

Official Report Journal
of Debates des débats
(Hansard) (Hansard)

Tuesday 20 February 2001 Mardi 20 février 2001

Standing committee on Comité permanent des finances
finance and economic affairs et des affaires économiques

Pre-budget consultations

Consultations prébudgétaires

Chair: Marcel Beaubien Président : Marcel Beaubien
Clerk: Susan Sourial Greffière : Susan Sourial

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Publié par l'Assemblée législative de l'Ontario

LEGISLATIVE ASSEMBLY OF ONTARIO ASSEMBLÉE LÉGISLATIVE DE L'ONTARIO

STANDING COMMITTEE ON COMITÉ PERMANENT DES FINANCES
FINANCE AND ECONOMIC AFFAIRS ET DES AFFAIRES ÉCONOMIQUES

Tuesday 20 February 2001 Mardi 20 février 2001

The committee met at 0857 in the Four Points Sheraton Hotel, London.

PRE-BUDGET CONSULTATIONS

The Chair (Mr Marcel Beaubien): Good morning everyone. I'd like to bring the meeting to order.

LONDON HOME BUILDERS' ASSOCIATION

The Chair: Our first presenter this morning is the representative from the London Home Builders' Association. Good morning, and could you please state your name for the record.

Mr Carl Dinardo: Good morning, Mr Chairman and members of the committee. My name is Carl Dinardo and I am vice-president of the London Home Builders' Association. I've been a builder in London for almost 10 years, and I specialize in building custom single-family homes. I am a volunteer in the local association and support the work of our provincial group, which is the Ontario Home Builders' Association.

I appreciate the opportunity to speak with you today and I'll make sure my report is fairly brief. You have copies of the full written submission. It was prepared by our Ontario association and outlines in detail some of the points I'd like to make today.

Let me start off by telling you a little bit about the Ontario Home Builders' Association. The Ontario Homes Builders' Association is the voice of the residential construction industry in Ontario. As a volunteer organization, the OHBA represents about 3,500 member companies which are organized into 31 locals across the province. Here in London our local consists of more than 200 member companies. Our membership is made up of all disciplines involved in residential construction, and that would mean builders, land developers, renovators, contractors, suppliers, manufacturers, realtors, lenders, housing consultants, economists, planners, architects, and the list goes on and on. Together we produce about 80% of the province's new housing. The residential construction industry employs approximately 200,000 people in the province and contributes over $20 billion to the province's economy every year.

As I am sure you can appreciate, a healthy residential construction sector is not only indicative of a healthy economy in general; it is also a precursor to future growth. Economic expansion usually starts with an increase in housing starts as well as industrial and commercial development. This leads to new infrastructure projects, along with institutional expansion, which provide the necessary foundation for the next generation of economic activity.

Last year just over 186,000 jobs were created in Ontario, and many of these jobs were in residential construction. It's estimated that every average housing start generates approximately 2.8 person-years of employment. Housing starts and renovation spending for the year 2000 were the highest in this past decade, allowing our industry to provide record levels of employment for Ontarians.

Last year our industry contributed over $20 billion to the economy of Ontario. Construction activity also contributes significantly to government revenues. On average, each new home contributes $40,000 to $50,000 in taxes and fees collected at all three levels of government. Based on over 71,500 housing starts last year, that amounts to over $3 billion in tax collected at various levels as a source of revenue. Add to that tax revenues collected from renovation work, and it is clear that our industry is a major contributor to the health of Ontario's economy.

In general, the year 2000 was another busy year for our industry. Ontario's housing market was healthy and stable, showing a steady improvement. Starts last year were up by 6.4% over the year before. Stability in the housing sector should continue into the year 2001, bolstered by high consumer confidence, a healthy employment market and a solid GDP.

Some of the major highlights for 2000 would include the fact that starts were up across the province with some areas showing very significant gains. Some of the larger increases were found in Kitchener, Ottawa-Hull, Oshawa and Toronto. However, there were communities that experienced decreases in starts. The communities that experienced these decreases included Thunder Bay, Sudbury, Hamilton and the St. Catharines area. Here in London, starts were just over 2,900 homes, which is a slight drop compared to last year.

Multiple-family construction was up almost 10% in 2000 compared to the previous year, and single starts were up about 4%. However, the rental housing construction is still quite stagnant, despite Ontario's robust economy and incentives brought forth by the provincial government.

One of the contributors to the healthy new housing market in Ontario can be attributed to the success of the land transfer tax rebate program for first-time buyers of newly built homes. Since this measure was first introduced in 1996, about $106 million in rebates were given to over 78,000 Ontarians to assist them in the purchase of their first home. This in turn contributed to 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 buyers.

Every year OHBA conducts an economic forecast survey of our members and the results of that November 2000 survey are included as appendix A in the submission. Nine out of 10 members surveyed expect sales to increase or remain the same in 2001 compared to the previous year. This optimism is reflected in OHBA's forecast for 2001. We expect 70,000 starts this year, which would represent the fourth straight year of growth.

Renovation spending is continuing on an upward trend, with about $11 billion spent in the sector last year. We predict renovation spending will climb to more than $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 many new buyers into the new housing market.

While generally optimistic, enthusiasm for the coming year is tempered with concerns over labour shortages and rising costs for materials and skilled labour. These increased costs, combined with increasing and new taxes, fees and charges, could hinder future growth.

More than 60% of our members cite increasing labour costs as an impediment to growth in 2001, and almost as many, 58%, are experiencing difficulties in finding skilled labour. The perception that increased building activity correlates to higher profit margins is inaccurate as builders continue to operate under extremely tight margins. Some 44% of our members say this is key concern for them in the coming year. Most of this is due to the difficulties in finding skilled labour and the higher cost for that labour.

Builders and renovators are not in a position to absorb increases in materials, labour costs or further government fees and taxes. The reality is that increased costs seriously hamper industry efforts to provide affordable housing for Ontario consumers. The London Home Builders' Association is fully supportive of the Ontario Home Builders' Association recommendations that are intended to make sure residential housing and renovation markets remain strong in Ontario. For example, development charges and education development charges imposed by municipalities across Ontario continue to concern us. Not only do these charges contribute significantly to the cost of housing in the province; there are serious concerns about municipalities not following the intent of the act, which is to ultimately reduce charges. As a result, development charges in Ontario have become some of the highest in Canada. The Ontario Home Builders' Association recommends close government monitoring of the development charges and education development charges and even intervention, if necessary, to ensure that the intent of the legislation, which was to reduce costs, is met.

Secondly, excessive regulation and overtaxation on the home-building industry pushes the price of new homes higher and higher and consequently puts home ownership out of the reach of many citizens. The Ontario Home Builders' Association urges the government to introduce legislation that ensures fees are based on a reasonable direct cost-recovery basis and, further, that such legislation allows for an appeal of municipal decisions about fees and level of service. The Ontario Home Builders' Association participated in the work of the business tax review panel appointed by the Minister of Finance and encouraged a thorough review of the recommendations from the panel.

The difficulty in finding skilled labour to meet the needs of our industry is a very serious and complex problem. Tradespeople lost during the recession, combined with a record number of workers retiring, has truly exacerbated the situation. Informing and educating the public about the opportunities in our industry, as well as dispelling some of the negative stereotypes that are associated with skilled trades, is a major challenge for all of us. The Ontario Home Builders' Association recommends the development of co-op programs, perhaps at the high school and college levels, that actually bring students on to job sites and provide them with some hands-on experience in construction and the safety practices associated with the construction sites. We also urge the government to increase school funding for shop facilities in order to run the programs productively. In addition, we encourages the government of Ontario to take an active role in urging young people to consider a career in skilled trades.

Rental housing is in short supply in a growing number of urban centres across this province. Nine regions have a vacancy rate of under 2% and five cities, including Toronto, Barrie, Ottawa, Kitchener and Guelph, have vacancy rates under 1%. Here in London, our vacancy rate has dropped to about 2.2% compared to 3.5% in 1999.

Despite Ontario's robust economy, the reality is that very little new rental housing is being built. The provincial government has undertaken a number of initiatives in the past to encourage the construction of rental accommodations, including most recently, the PST grant program. OHBA recommends the government renew the PST grant program and increase funding for this important initiative to support new affordable construction. A review of program criteria is recommended so that the grants target the intended sector. In addition, OHBA urges the provincial government to review the recommendations from the Housing Supply Working Group and to seek to eliminate any disincentives that currently discourage the private sector from building rental accommodation.

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

0910

Pressure from the underground economy continues to be a major problem for our industry, particularly in the renovation sector. In addition to unfair competition, obviously governments lose out on billions of dollars in lost revenues. Health and safety standards of workers are not likely to be met by underground contractors, and homeowners suffer, with little or no recourse, in the event of shoddy or unsafe workmanship. OHBA recommends that the government work together with the industry to seek out ways to encourage and entice consumers to use the skills and services of legitimate, honest renovators and subcontractors. OHBA also supports the idea of a voluntary registration of renovators and site supervisors, as opposed to a mandatory certification outlined in the recent recommendations of the Building Regulatory Reform Advisory Group, or the BRRAG committee.

Let me conclude by noting that this government has cut taxes almost 100 times since being elected in 1995, and in last year's budget announced a further 67 tax cuts over the next five years. We urge the government to continue on this path that has proven to be successful for Ontario. Let me also repeat that the OHBA and its members strongly support the fiscal policy of the provincial government and encourage the government to continue in the direction of spending cuts and tax cuts.

Mr. Chairman and members of the committee, I'd like to thank you for your attention and interest in our presentation, and we look forward to hearing any comments you might have.

The Chair: We have approximately three minutes per caucus, and I'll start with the official opposition.

Mr Monte Kwinter (York Centre): Thank you very much for your presentation. We've heard from various groups representing the home builders of Ontario. I'm particularly interested in what's happening in London. London is a vibrant community. It's got a very solid business base. Yet I see that the housing starts are down, whereas in most other communities, the housing starts are up. I can understand, we were up in Thunder Bay and they are down fairly dramatically, but Thunder Bay is a long way from the main corridor that we have right here. What do you attribute that to?

Mr Dinardo: London is unique, as I guess every centre in the province is, in its own way. London, I think, doesn't have the peaks and the valleys that some of the other municipalities in the province might have. I think London has just been a little bit slower to pick up to the speed of the municipalities that are a little bit east of us, like Toronto, Kitchener, Guelph and so on.

We see it as being a busy year this year. The land transfer tax rebate has probably been a huge benefit for first-time buyers. I think the problem has been affordable housing more than just housing in general and the ability of keeping housing affordable for first-time buyers. As long as we continue to work together on that, I think London will come back into its own and we'll be up this year over last year's figures.

Mr Kwinter: I don't know whether you saw the Globe and Mail this morning, but there's an article that says manufacturing shipments dropped in the month and StatsCan has already revised its figures from 0.3 to 0.1. There's an interesting comment which says that the manufacturing sector in the United States is in a recession even though the rest of the country isn't. It would seem to me that what happens there happens here because we are so dependent on that market. Do you feel that that is going to have an impact on your ability to increase the starts?

Mr Dinardo: Thank you for comments. I'd like to just say that London is unique in one specific way in that we don't have a lot of manufacturing proportionally compared to other municipalities. We do build in other locations near London and a lot of them have a very strong manufacturing base, such as St Thomas. We find that their housing starts have declined this year. Basically, you're 100% correct. It's a manufacturing-direct relationship.

In London, fortunately, that's probably why we don't have the peaks and valleys. Usually manufacturing, driven by spending or a lack of spending by consumers, tends to create those peaks and valleys. In London it stays fairly flat because it appears not to have that much manufacturing compared to other areas.

Mr David Christopherson (Hamilton West): Thank you for your presentation. I want to pick up on the issue of the underground economy. It's one we've focused on in past tours but not so much this time, and yet it continues to be a growing problem. Most people seem to point the finger at the GST as being the trigger that really drove even more people into the underground economy than before, because of the psychological impact of the GST. Whether that's true or not really doesn't matter. What matters is that we've got major leakage in the economy, and I have a great deal of sympathy for those of you who are trying to play by the rules. It doesn't make a lot of sense for us as legislators to pass laws and then not have them followed by the people who elected the folks to pass those laws.

Having said all that, how do we begin to turn this tide? My sense, from my own personal experience, what I see and what I know, is that it's growing and that it's becoming seen less and less as anything illegal. People believe that the government really doesn't have the moral ground on this issue. I think a large part of the leakage as a percentage of the total economy is in your area of the economy. How do we begin to turn that around, in your opinion, without having troopers marching down the streets?

Mr Dinardo: It's interesting. I was at a committee meeting with respect to the underground economy. I think this year in particular we're seeing the auditors at the Workplace Safety and Insurance Board of Ontario concentrating more on the construction sector. The rates in new construction are about $13 per $100 of labour, and certainly you can appreciate that if someone is making a cash deal, if you will, there are a lot of tax dollars that don't get put back into the economy that should be. Obviously, each and every one of us picks up those costs in increased tax rates across the board.

What we've found -- I think the concentration, as our report outlines, is that we're not necessarily looking at additional enforcement but rather are trying to twist it in a positive way, in that we'd like to see the government's help and recommendations on ways to encourage and entice consumers not so much not to use the underground economy or the cash economy but rather to use legitimate, honest renovators and contractors, mostly from the perspectives of getting the job done right the first time -- I think no matter what we do, we'd like to do it right the first time -- and of warranty. From a new home construction perspective it's not as important because we have to be registered builders; it's done typically on purchase and sale agreements and so on. It's the renovation industry that is the difficult sector. We definitely look for the government's support on ways to advise --

Mr Christopherson: Would you start with the business community? This I don't know. Is it as prevalent, do you think, in the business community as it is in the private world?

Mr Dinardo: I would say not, but that's really only a personal opinion. It doesn't seem to be. There are all kinds of measures there to ensure that you're doing things properly. It's the private person who needs a roof done and says, "Will you do it for cash?" Those are the real problems.

Mr John O'Toole (Durham): Mr Galt may have a question too.

I just want to concentrate on the rental issue, if I may. I wonder if you could comment on the decline in rental units. The development charge is part of that. Do you know what the development charge is per multi-residential or rental units? Also, is there a difference? The GST is charged on rental and it isn't on residential. Also, the multi-res classification has a higher tax rate than residential. Those are three measures that could affect the supply of rental accommodations. We hear that housing is a significant social shortage. Perhaps you could comment on those three tax aspects.

Mr Dinardo: I would love to, but unfortunately that's not my area of expertise. If you'd like me to get somebody to offer an opinion on them, I'd be happy to do that for you.

0920

Mr Doug Galt (Northumberland): Thanks for your presentation and also for your kind comments about some of the government's initiatives. I want to explore the area of affordable housing. Just to set the stage a little bit, I hear everything from you commenting on lower vacancy rates in London. In small-town rural Ontario those vacancy rates are going up. I hear people can't afford some of the housing; I also have landlords coming into my office about their apartments being trashed or their homes that they've leased out being trashed. They're almost petrified to rent out; they'd rather leave them empty.

A bit tongue in cheek, are we talking about affordable housing from the government's point of view? I don't think so; I expect you're talking about it from the lessee's point of view. I've heard you say and I've heard many others say "affordable housing." What is affordable, and to whom? What's your definition of "affordable housing"?

Mr Dinardo: Affordable housing, to me, means your average citizen working at an average wage should be able to afford to get into the housing market and not feel there's a barrier to being able to get into that market. The price level is obviously determined by wages, determined by interest rates, a percentage of down payment. There are lots of factors other than just to peg a number to affordability.

Mr Galt: So for you the purchase of a home is affordable housing.

Mr Dinardo: Sorry, I apologize, Doug. From my perspective it is, because we're in the business of building single-family. I'm not too up on what's affordable from a rental perspective.

Mr Galt: I was just curious -- you were using it -- what you were making reference to. So in your case it's at what level of price the home can be afforded by the average Joe and Jane Public.

Mr Dinardo: Exactly. I have a personal interest in that, because both of my parents are immigrants to this country and both of them had very average jobs, and they could buy a house, which was something they couldn't expect overseas. I feel really strongly that everybody should have that opportunity. So when it comes to new housing, or buying a home in general, I feel very strongly about continuing some of those incentives. They're not necessarily huge incentives, but they're very effective. I have to look at it as very similar to, say, advertising, where you can spend a great deal of money in advertising but if it's not effective, it doesn't do you any good. The same thing is important here. This is the purpose of these types of groups, that we want to not only ensure that policies are implemented, but also that they're effective -- cost-effective as well -- in getting the results we're looking for.

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

UNIVERSITY OF WESTERN ONTARIO

The Chair: Our next presentation is from the University of Western Ontario. As soon as the presenters are ready to come forward, I would ask them to state their names for the record. On behalf of the committee, welcome. I'd like to point out that you have 30 minutes for your presentation this morning.

Dr Paul Davenport: I'm Paul Davenport, the president of the University of Western Ontario. I'm here with my executive assistant, Dalin Jameson. Thank you very much for this invitation. We are proud citizens of London, Ontario, and of our province. Our university makes an extraordinary contribution both to the city and the province, and I want to tell you a little bit about that contribution. I'll say a bit about how the province has helped us in recent years and then a bit about the challenges we face in the future.

First of all, just to say a little bit about Western as an economic force: we had a study done by an accounting firm a couple of years ago and presented it to our city last year. Our university generates about a billion dollars' worth of economic activity every year in the London area. We would be one of the pillars of the London economy, both in terms of employment and the spinoff benefits of our research. We do over $100 million of sponsored research every year, and that in itself is like a large export industry. It generates jobs both in our region and across the province. So we are part of that economic force referred to as the knowledge-based economy that Mr Eves and others have referred to many times in their speeches. Increasingly our prosperity as a province, as a city, in London, will be dependent on how well we educate our young people, how well we prepare them for an advanced economy and how good we are at research. Are we generating the new ideas ourselves in Ontario or are we forced to buy them from others?

I believe by now everyone has received a copy of our brief. I'm not going to read this brief but the ideas I will speak to are included in it. You've also got a copy of a recent document from the Council of Ontario Universities called For the Record, which goes into much greater detail than I can on the importance of Ontario's universities for prosperity and job creation.

Finally, I'm going to get to the last document, which is a description of our biomedical sciences project, which is right at the edge of the knowledge-based economy and very important to us and to the city of London and, we think, to the province as a whole.

With that economic background in mind, let me turn to some of the key government initiatives we've seen in recent years, by way of saying thank you. Among those key initiatives would be the Ontario student opportunities trust fund, which allowed us to partner with the province and raise over $30 million for student aid at the university; the access to opportunities program, which has allowed us to double the size of our programs in electrical engineering and computer science, not only giving our students tremendous opportunities but meeting very pressing labour market demands in the province; and the extraordinary investment in research in the last five years.

I came to this province from the University of Alberta, where I had been president, in 1994. At that time there was a feeling of despair among researchers in Canada. There was a feeling that Canada might not be a good place for you to invest your career if you were a young researcher because the support for research just wasn't there. We were clearly losing a growing number of our bright young people to the United States.

That has been turned around dramatically, and here are some of the programs that turned it around: the Ontario R&D challenge fund; the Ontario Innovation Trust, which provides support for researchers who win funding in the Canada Foundation for Innovation; the Premier's Research Excellence Awards; and the Ontario research performance fund, which provides badly needed overhead costs for the research we do. Taken together, those programs in the last five years have dramatically changed the setting for Ontario universities in general, and Western in particular. We can now look forward confidently to competing for outstanding researchers and giving them the funds they need.

Finally, I want to express Western's gratitude for the investment of the SuperBuild Growth Fund, which was some $40 million for our campus and will allow us to build the infrastructure we need to accept the growing student demands that come from the echo of the baby boom and from the double cohort. I'll say a little bit more about those in a moment.

0930

What are the challenges then, if that's the background? We face an unprecedented increase in enrolments over the next decade. You would have to go back to the 1960s to find anything like what we're going to face now. In the 1960s it was the people of my generation, the baby boomers, who were the problem. Indirectly we're the problem again, because now it's our kids who are coming to university. I have three children, all of whom are approaching university age, and there are millions like me. So we are facing an extraordinary increase in the demand for higher education right across North America.

In Ontario we're estimating that there will be an increase of some 30% to 40% in university students over the next decade. We'll be competing for faculty, with US states and other Canadian provinces facing similar kinds of increases. So it's going to be an extraordinary time over the next decade.

In the case of Ontario, the general North American issue of course is reinforced by our double cohort, the fact that there will be two classes graduating in 2003-04 from our high schools: the one class that entered 9th grade in 1998 and did a five-year program and the other class that entered in 1999 and did a four-year program. My daughter is in that second class, and I can tell you, when I go to receptions and cocktail parties, that's what people are talking about: how are we going to deal with this double cohort?

At the same time that's coming at us, all those faculty we hired for the first baby boom are going to be coming to retirement. About a third of our professors are age 55 or over. So we're going to face an extraordinary challenge in getting the new professors to teach the increased enrolment and simply replacing those who leave.

We'll be facing these challenges at a time when our relative funding has been in decline for 15 years or more and our student-faculty ratio in Ontario has risen far above the standards in the rest of Canada and North America.

So here's the baby boom echo, the increase in population over the next decade, and you can see that Ontario leads the county. Not everybody in Canada is going to experience this, but we are. We're going to have a very sharp baby boom echo, stronger than any of the other provinces. We look like most American states, our demography is similar to most American states, so we've got a big challenge ahead of us.

Moreover, you can see the age pattern. We should have done these slides in colour for you. Forgive me. It's hard to read this thing without the colour. What's happening? If you look at that peak shifting to the right, that's the growing age of our faculty. You can see that age is now overwhelmingly above 55, a third of those people are now 55, and they're going to be going. If you go back to 1976, here on the left-most graph, we had an extraordinary number of people in their 30s. Now we have relative few faculty in their 30s and a whole lot over 55, and they're going.

We've also struggled in Canada to keep our faculty and recruit more because of the growing divide between our funding and that in the United States. This is a graph that shows, with an index of 1980 equal to 100, that in the public universities in the US states -- and these are states that often have balanced budgets in their constitutions, they're very fiscally careful -- they've been investing massively in their public universities, so that over this 20-year period their funding is up nearly 20%. You can see that in Canada our funding per student, corrected for inflation, is down nearly 30%. That's a big difference and it's making it tough for us to compete either in quality or in resources with those US public universities, and they are representing our biggest trade partner. Just to be clear, there's no Stanford or Harvard in here. We're talking about universities that look just like mine. They're funded by the US states and they're doing very well indeed.

Here's how we compare in terms of funding, if you look at a purchasing power parity dollar of 82 cents. So we're not looking at the 65-cent Canadian dollar; we're saying that's undervalued. It should be worth 82 cents in terms of what you can buy, so we're twisting the comparison so Canada looks better than the 65-cent dollar would have us. But you can see that in terms of tuition or core public funding, the funding from the state or the province, and total funding, we're lagging the US by about 35% to 40%. We're well behind in terms of real funding per student. Again, that makes it tough to compete.

I mentioned the student-faculty ratio. You can see that over the last 13 years that student-faculty ratio has gone up by more than a quarter. This has been a trend when the enrolments were not growing much. We are very concerned that we get a cap on this thing before the echo of the baby boom hits us, so that when we look at this graph 10 years later, it didn't go up by another quarter over the first decade of this century.

How do we stack up in terms of our student-faculty ratio relative to other universities? Let's take the US public universities -- Ohio State, Mississippi State -- as our comparison and call them 100%. The rest of Canada would have a student-faculty ratio of about 20% above those US public universities. Ontario would be 35% above the US public universities. So again we're at a disadvantage. You wouldn't find statistics looking like this for the public school system, the primary and secondary school system, but we are at a disadvantage in the university sector.

What do we need to do, then, to meet the challenge of the double cohort, to meet the echo of the baby boom and give our students a quality education that prepares them for the knowledge economy? How can we get the resources in place to make our contribution to that knowledge economy at Western? Our first need is rebuilding what we call our human infrastructure. We've seen significant declines in our full-time faculty and full-time staff over the last decade -- about 16% for faculty and 19% for staff -- at a time when our enrolments were growing. This is what of course creates that growing student-faculty ratio. We've been closing positions and laying people off and we've just got to reverse that if we're going to meet this challenge of the double cohort. We need to start hiring faculty again and hiring staff again. I want to underline the staff. When we say "staff," we mean non-faculty staff. These are the folks who look after students in the dormitories, who guide them through the registrar's office, who work in the libraries, who provide all those services that make a university a university. We can't do without them and we can't do, of course, without the faculty in the front of the classroom, teaching.

We also have to deal with our physical infrastructure. We've got some 40 very large buildings on campus and this is when they were built. You can see slightly more than half of them were built in the 1960s and early 1970s. Where that says 1970, that was all done by about 1974. These buildings are now 30, 40 years old or more and they are reaching the point where they need their first massive upgrade. We're trying to run laboratories for very modern science in spaces that were built back in the 1960s, and it's not working. We're losing our ability simply to do the experiments in terms of air cleanliness and so on. We need some major upgrades there.

Western, as my paper points out, and you can read about this, has been setting aside three quarters of a million dollars every year from our operating budget for deferred maintenance on a continuing basis. So it goes three quarters, a million and a half, two and a quarter, three; we're now up over $4 million. So we've been doing our part, but we do need help with that deferred maintenance problem. It's a big issue for us. I should say the payback on that deferred maintenance is that suddenly the students and the faculty have modern laboratories, modern work spaces, and we're just a lot more efficient in producing a quality education and getting successful research done.

I also want to say a little bit about our response to the baby boom. Our plans are to increase our enrolment at Western during that baby boom period by over 3,000 students, and that's on top of the significant increase in student numbers in the years preceding 1998. So we are committed to growing with the baby boom. We have three large buildings now that we'll be able to put up with SuperBuild funds: an advanced technology centre that will house our engineering faculty and its expansion, and two new academic buildings that'll have student labs, research labs and classrooms. We will also put up with our own money -- we'd never get any provincial money for this purpose, and we should not -- a new student residence. We built two student residences in my six years as president. They are a tremendous recruiting tool for us. They allow us to bring academic programs into the place where the students live.

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So that's our plan. What we need are the operating funds to be able to hire the professors and the staff. The other pieces are getting in place. We need those funds to be able to hire the teachers, and the staff will look after the students.

You should know that we are committed to an accessible university at Western in the sense that we will be growing and we will be sure that no one is denied admission for financial reasons. So in terms of the student aid funds that we actually control, they've gone from $5 million to $24 million in just the last eight years. Our province gets a lot of credit for that. Part of that is the OSOTF program of matching grants for student aid endowments, and the other part is the 30% set aside on our tuition. Every time we raise tuition $1, we set aside 30 cents for student aid, and there it is. So our commitment is that no one is going to be denied access or the ability to finish a Western degree for financial reasons.

We have been strategic in the use of our resources; I'll give you just a couple of examples. We've been building cross- and interdisciplinary teaching areas that are extraordinarily popular with the students. Our new student recruitment is arriving in these new areas, like our health sciences degree, in an astounding fashion. We've also been switching money very effectively into those programs that are expanding fastest. So we're putting our money where the students want to take their courses. It's been a good recruiting strategy for us.

First-time, first-year, first-choice applications this year in the province are up about 3%; at Western they're up 10%. We're doing very, very well in our student recruitment, for those reasons.

When I arrived in 1995, I embarked on a strategic planning task force. That document is called Leadership in Learning and it has guided us for the last six years. We are now involved in an update on that document. We'll be circulating the first update in June and a revised strategic plan next fall. Again, that will keep us focused on our strengths, investing in our strengths, making sure that we use our funds wisely.

This is my last slide, and then I'd welcome any questions.

What would be our priorities? I think to a degree on this first one you'll find unanimous feeling among the universities. It would simply be that we get funding for the enrolment increases that we know are coming, the massive increases in undergraduate and graduate students that are coming. We would ask the committee to endorse the notion that they will receive full funding at current rates so that we do not drive our student-faculty ratio up any more and we can stabilize it where it is in the hopes one day, frankly, of getting it down.

We're also hoping that perhaps in the one-time funds from the year-end budget surplus there would be provision for deferred maintenance funding so that we could get on with refurbishing these buildings from the 1950s, 1960s and 1970s that need help. One example of that deferred maintenance is the medical sciences building. London is a medical powerhouse. We're known around the world for our medical research. Western is at the heart of that reputation. A great many of our labs are in the medical sciences building. We simply must update them if we're going to keep recruiting great scientists.

We will be recruiting a number of faculty over the next 10 years, probably about the same number we currently have. If you can imagine that, it's an extraordinary challenge. We won't get the right people in medical sciences unless we have good space to show them; they just won't come to us. So that's mission critical for us. I should say that all our partners, all the hospitals in the city, all the research labs, have signed on and support that project, as they support the city-wide animal care facility. That again will allow us to stay on the cutting edge of science.

So medical science and the city-wide animal care plug into that knowledge-based economy, plug into our leadership and research, and help us make London and Ontario a dynamic place to live, work and raise a family.

I think I've left a little bit of time for questions. I would welcome any that the committee might like to put to me.

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

Mr Christopherson: Thank you for your presentation. Certainly, your university has a phenomenal reputation right across the province, and I say that as someone who has McMaster in their riding.

I wanted to talk about skilled workers. Obviously, you would know that we're hearing right across the board that we need skilled workers, all the way from construction to the high-knowledge-based end and the high tech. Assuming, and I realize your main desire in being here is to get the government to focus on the need that universities have, and I would point out as I have in other communities that on one of our opening days in Toronto the chief economist for the TD Bank went out of his way to include in his presentation the comparators of post-secondary education funding here versus our main competitors, similar to what you've done; but they went into greater detail. So you've got business on your side saying that we need this as a component of a good economy in which to make money.

That notwithstanding, that you're here to convince the government, and they've heard it over and over and over again, of the need for post-secondary education funding, is it your sense that we have enough young people who will be interested in all facets of where we need skilled workers; or, even in your most optimistic projections, are we still going to fall short and should we recognize that now and begin to take steps, whatever those might be, students from other countries, something; or is it a question of just making sure we've got the facilities to put them through, because there are enough young people who will go on to acquire the skills we need in our economy?

Dr Davenport: The skills issue is a very broad one. Most people right now don't go to university, so you have a responsibility to see that that majority of people get the skills they need in high school or in other institutions. Often, those skills are very, very specialized, whether they are pipefitters or electricians or whatever it is. In those cases, you may be able to fill the gap with selective immigration or selective programming or whatever it is.

In my world, we're talking about people who graduated for the most part with a fairly broad education and are in enormous demand right now. It's not well understood that the people graduating in arts and social science and the basic science courses at Western and elsewhere are going out and making a wider wage gap, making more money compared to a high school grad, than they ever did. There, I think, immigration won't do the job. There you really need to invest in the people themselves, invest in their education.

Yes, I think the demand from the students is going to be there. We're just watching a surge in demand for Western, because people see this relation between getting a university degree and success in the labour market.

Let me say that there will be specific niches where we need to work with you to fill a specific gap; nursing is one, and Western is expanding in nursing. We have a great joint program with Fanshawe College. We jumped at the opportunity with ATOP and we've expanded there. But this knowledge economy is not about narrow gaps in computer science or nursing; it's about a broadly based, broadly educated workforce. There, I think, the solution is the investments we're calling for.

The Chair: To the government side.

Mrs Tina R. Molinari (Thornhill): Thank you very much for your presentation, Dr Davenport, and also thank you for the work you do on the Council of Ontario Universities and the working group on university capacity. I've met with Dr Ian Clark a number of times, and I know the minister is quite pleased with the work you do and the consultation process that takes place in assisting the ministry to resolve some of the challenges that we'll be facing.

I have a couple of questions and just a comment on the comparison you made with the United States. What I find interesting at times is that various people compare to the United States, and there are some who criticize us for going toward the Americanization of Canada, and that's done in a very negative way. Yet when we talk about the funding that is available for some things, like education, then certainly we take great pride in comparing to the United States. In saying that, I just want to say that in some cases it's a good comparison, yet in others it isn't. We can't have pieces of it without the others, just to put it in perspective.

I'd like to hear your comments on the idea of student-focused funding and looking at the possibility of doing that for the post-secondary institutions, and also your comments on the new private universities bill that has been passed and the implementation of that.

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Dr Davenport: First of all, let me say on the preamble that there are many things wrong in the United States and many things I wouldn't want to copy, certainly. But I think the US has the knowledge economy right. They get it. They understand the relation between investing in education and research and giving opportunities to their citizens. So on that one, I think they're setting a standard that the whole world should be interested in. I think they're getting it right.

Student-focused funding: absolutely. I think what we are evolving in Ontario is a very competitive higher education system, where students now are paying a greater share of their education; they're very, very oriented toward quality and outcomes and they're appropriately putting the pressure on us, as universities, to show that we monitor quality and that we deliver it. So I think our current system is leading to a situation where we are funded according to the number of students we have and, indeed, our ability to attract students depends on quality.

I think we have a student-focused system now, and I'm certainly open to any suggestions for improving it, but I can tell you -- let me take Western, for example. We're the only university that I know of in Ontario that does this. We survey all of our courses every semester at the end of the course, and then we immediately put the results up on the Web site so that the students can see that Sally Jones is doing a great job and Paul Davenport is not. We try to monitor quality in that way to help the teachers who need to pull up their socks to do so. Frankly, one of the great results of that openness has been that the students see that overwhelmingly they're rating our courses very well. We do a similar thing when they graduate. We have an exit survey and then we publish the result. So student-focused funding: absolutely. But I think we can do that through our boards and through internal accountability.

My position on private universities is well known, I think. Western is not worried about competing with private universities in Ontario or anywhere else. It's not a problem for us. We are worried about getting the public funds to compete with the great public universities of the US. We see them as the competitive force we have to deal with. I've been quite at ease with the legislation that was passed, and when I appeared before the minister's consultative committee, I put all my emphasis on the quality evaluation and had suggestions about how the quality assessment board could operate.

But we are in a North American environment where, in some jurisdictions, private universities have been extraordinarily successful. My concern is that we give our public universities in Ontario the tools they need to do the job.

Mr Pat Hoy (Chatham-Kent Essex): Thank you very much for your presentation this morning. You've touched on a number of possible barriers in the future, but I'll talk about your retirement of faculty, the natural increase in the population of Ontario wanting to avail themselves of universities and, of course, the wonderful notion that students want to go to Western as their number one choice, more so than any other university. What will be the bigger problem in the near future in terms of faculty? Will it be your ability to financially pay them or will it be finding them? What is going to happen with this huge retirement? Are there people to take those jobs?

Dr Davenport: Right now our problem is with the money to pay salaries. We haven't been able to recruit, because we haven't had the funds in our budget. When we do recruit, we get outstanding people. If you were to look at the people we've hired over the last five years, they are superb.

Somewhere in the next three or four years, though, I think the pendulum is going to shift and that second problem you raised is going to start to bite on us. We have not expanded our graduate programs in Canada the way we needed to. We're going to face tremendous competition from the United States. The problems that we can see already in certain niche areas, like finance in our business schools -- all of our business schools are killing themselves to hire finance professors. They're getting offers from the United States at over US$100,000. Similar things at different salary levels are happening in electrical engineering and computer science. I think there is a threat that this kind of severe competition from the US will be generalized, and then even if we have money to hire professors at our going rates, they'll be very hard to find.

What's the solution to that? It's to get out into the market early. The sooner we can get funding to hire our new faculty, the better the faculty we will get. While I didn't say this in my presentation, I should have: our hope, of course, is that the government's announcement on the double cohort and the echo of the baby boom funding is going to be in that May budget. That's when we need it. We need that commitment of funds to educate those students so we can get out now and get the best faculty.

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

TOGETHER IN EDUCATION

The Chair: Our next presentation this morning is from the elementary teachers' federation, Waterloo local. I would ask the presenters to come forward and state their names for the record. On behalf of the committee, welcome.

Mr John Ryrie: My name is John Ryrie, and I'm actually president of the Ontario Secondary School Teachers' Federation, district 24, in Waterloo. On my right is Brydon Elinesky, who is president of the Elementary Teachers' Federation of Ontario, Waterloo unit; and on my far right is Pat Cannon, who is the president of the Ontario English Catholic Teachers' Association, Waterloo unit.

We are members of a group we call Together in Education, which has been around in our region for about 20 years where all the affiliates try to work together to do various initiatives. One of the things we have done this year, for example, is raise money for our teacher-build through Habitat. It will be the first teacher-build in Canada. We've raised over $67,000 so far toward that end. That's the kind of thing we have done and we do. So we're actually three federations coming together to speak with one voice.

You have a presentation in front of you, and we'll just work our way through it.

As the introductory paragraph indicates, we represent 75,000 students and more than 4,000 teachers and educational employees in the region of Waterloo. Our presentation indicates our belief that the education system lacks the resources to provide the quality of education that Ontario students deserve and that we know their parents expect.

We are certainly here to refute the notion that in 2001 we can possibly continue to do more with less. This is a rather simplistic notion that we believe has long outlived any usefulness it ever had when applied to schools, which are intensively people places.

We are here to encourage the government to restore funding that has been removed from our schools and our students and to establish true core stable funding that is supportive and enhancing instead of destructive and debilitating.

Bill 74, like all legislation since 1995, has presumed to improve the quality of education provided to students in Ontario. It has had the opposite effect. This has been especially true at the secondary level, where teachers have been forced to teach an additional seventh class during part of this current school year as part of their full-time workload.

Compounding this additional workload has been the additional work required to prepare the new courses of studies in grades 9 and 10, next year grade 11, and the following year grade 12. Teachers who have been used to the norm of four "preps" -- and I had a principal say very recently that that was what they always tried to do in the past. If you had six courses, they would try to give you four preps. That in turn supported everything else that teachers have provided to secondary students. But these people have faced the grim prospect of preparing six or seven preps while having less time than ever before to do the marking, the report cards, and everything else associated with those courses.

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The fallout of this particular bill has been particularly devastating. At every high school in Ontario there are 6% to 8% fewer teachers to teach all the courses and all the students. Of course, you have people doing more courses so you don't need as many teachers. When coupled with the additional challenges of the changes in secondary courses and structure, many teachers have had only one possible response to cope with this workload issue, which has been to reduce or eliminate their extracurricular activities.

Some examples from Waterloo: the public high schools last year sent 21 entries to the Sears Drama Festival; this year, according to the head of the drama association, they will be sending three, four or five. I received news yesterday that this year, for the first time in 20 years, our region will not be holding the annual English awards banquet that honours the remarkable achievements of students in prose writing, drama, poetry, school yearbooks, short story writing, debating, school newspapers and filmmaking. This is an astounding banquet that we've had for 20 years that recognizes the remarkable achievements of our finest students, supported by both local universities, which go to the trouble of not only marking some of the submissions but also doing workshops for the students in the particular areas. It's been organized entirely by teachers and has for years honoured these kinds of students in not only the separate and public boards but also participating private schools in the region.

To quote the fax that I got yesterday from Peter vanderMaas at Kitchener collegiate, "There are too few teachers available to continue this year."

The loss of other activities, whether they be sports, clubs, bands, choirs, or dramatic productions, has been well documented since September; I don't have to go into a lot of detail on that. But it continues to be a problem that cannot be solved by the threat of mandatory free overtime or by the simplistic notion that community volunteers can slip in and fill the voids. Besides which, as students said so well and so compellingly to Gerard Kennedy, who I notice is here today, at Resurrection High School on January 16th, the students don't want outsiders heading up their extracurricular activities; they want to connect with their teachers.

The educational cost of removing $125 million to $150 million from secondary schools in order that more courses are taught by fewer teachers has been enormous. Nothing has been improved by the removal of this money. The dramatic change was shortsighted in the extreme, not just in terms of throwing extracurricular activities into disarray, but in terms of lowering morale, increasing staff illnesses and disfiguring the reputation and the attraction of teaching in Ontario. The new workload is one more detraction from a profession that already has a critical shortage of teachers in such areas as computer science, mathematics, technical studies and French. The previous speaker pointed that out, essentially, that all of these people coming out of these areas in our universities are being snapped up by places that honour them, appreciate them, pay them more money and give them a workload they can manage. The sharp reduction in university graduates applying to Ontario faculties of education is the clearest indicator that for all intents and purposes a job teaching in our schools, if not all our schools, has lost its appeal, even to those who want to make a difference in the lives of young people.

Regrettably, time does not permit a full discussion of the funding we need for our libraries, our technical areas, our infrastructure, our school maintenance, our office-clerical support -- and the list goes on. But there is a simple way to make a pretty good comparison. In 1995, the total monies spent on elementary and secondary students was approximately $14.5 billion. The government at the time bandied about this figure when it came into office. In 2000-01, the figure is approximately $12.5 billion, yet we have more students and we have exceptional needs that are not being met. In relative terms, we have sunk below every single American jurisdiction in per-pupil expenditures, if you compare American and Canadian dollars accurately. If you don't do that, if you take Canadian money at par with American, we now rank only 28th in North America. By comparison, in 1992, when we had far more teachers and far more supports for students, we ranked 13th, which wasn't bad at all, in per-pupil spending. We have moved a long way downward since 1995.

The key question with respect to the budget is whether education is a cost to taxpayers or whether education is an investment. You heard that from the previous speaker as well. If, as we believe, it is an absolutely critical investment in the future, then we have every right to expect that you will place this investment ahead of any imminent tax cuts. There may be a place for those tax cuts down the road, but right now we need investment. We all know the tax cuts will exert pressure for further cuts to programs and supports for students. There is no other way to balance the books.

If you recognize that taking billions away from publicly funded Ontario schools has had the same effect as forcing 10,000 nurses from our hospitals, then we are hopeful you will see the same need to put real money, and not just announcements, toward the dramatic shortfalls that continue to erode the educational services and supports for Ontario's students.

Ms Pat Cannon: What's missing in education today? The answer is really very simple. There is a great need for sufficient staffing by qualified and certified teachers, as well as enough money to fund the current curriculum changes mandated by the government. The problem is that there is not enough of either. Because of this, some of what could be happening in education just isn't possible.

Why are there not enough certified teachers? The answer to this is fairly simple as well. We have more teachers leaving the profession than entering and staying as a lifelong career.

The reasons for this situation are more complex, but they fall into five main categories: lack of motivation to enter the profession; current inadequate hiring ratios; the realization of actual workload, once hired; the lack of appreciation for their efforts by government and the public; and inadequate compensation for the investment of time and education they've put into it.

Consider first the motivation to enter any profession. There may indeed be a large number of idealistic, young future teachers out there, but how many of them are giving their career choice a second thought now because of all the negative press that has been directed at teachers and education in Ontario in general over the past few years? Most of it has been coming directly from our own provincial government, the one responsible for providing an education to the children of Ontario. Those who do still apply and are accepted into teachers' college soon find that teaching may not turn out to be exactly what they had envisioned.

The current ratios for hiring in elementary and secondary schools are calculated in the aggregate for the board and have not changed the fact that there are still many large classes in the province of over 30 students. In fact, because of these numbers, there are also many split grades, which means that a single teacher is now responsible for delivering two complete new curriculums to the children in his or her class.

Workload does become a major issue. Once a teacher has been assigned a classroom and a group of children, they have the overwhelming task of planning, preparing, delivering, assessing and reporting on as many as 13 curriculums in the elementary grades, and potentially seven different courses at up to five different grade levels in the secondary panel.

Of the five main tasks that teachers do, only one, delivering the curriculum, is actually done during the child's 300-minute instructional day. Somewhere in the rest of their day, they must find the time to complete the rest of their job in order to be properly prepared. Add to this the fact that teachers frequently spend three to four hours of additional time beyond those six or seven at school and you end up with pressures and expectations which bring about a very high degree of stress in their lives.

Then there are the expectations that seem to have been the centre of much debate over the last three years. What obligation does a person have to provide voluntary extracurricular activities to our children at school? Government and parental pressures are high for these to be provided and, for the most part, teachers would like to be doing them. They do find, however, that they just can't work activities into a schedule that is already too full, just completing the job that they were actually hired to do: teach the children.

How is workload affecting the burnout level of teachers? This is a more complex situation but the relationship is definitely there. Every week, we, as federation leaders, are seeing and counselling more teachers who are it finding harder and harder to deal with the multitude of curriculum changes that have been downloaded on to the classroom teacher over the last three years.

They are expected to implement all the changes in every area of the curriculum based on new and more difficult expectations for each age level. They are expected to evaluate the children's progress using an entirely new model for assessment, one that is very confusing for many parents to understand when they get their child's first report card.

Frequently, frustrated parents, upset with these new evaluations, are confrontational when dealing with the teacher, simply for evaluating according to government exemplars. This develops into a stressful situation for many of our colleagues. Many are feeling unappreciated by both parents and the public and that the integrity of the profession is constantly in question.

Because of these problems, we find ourselves in a major dilemma. The teachers continue to require a great deal of in-service just to begin to accomplish some of these curriculum change expectations. We now have only four PA days in an entire year. This is far too little time to manage the huge task that is still ahead of us. Can it be provided through workshops during the day?

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There is often too much information to be disbursed, causing too many teachers to be out of the classrooms too much of the time. To further complicate matters, there are often not enough occasional teachers available to cover the classes for the teachers receiving the professional development. In many cases, there is not enough money provided in a budget to pay the occasional teachers to cover the classes for professional development during the workday. Because teachers generally want to spend as much class time with their own students as possible, it leaves them with a confusing tangle of what's necessary for them to deliver a comprehensive program, and the desire to spend as much time in the class actually delivering the curriculum.

How are teachers coping with this stress? Many are not doing very well with it at all. In fact, in 1999-2000, of the nearly 10,000 teachers who left the pension plan rolls, only about 60% left to a retirement pension. The rest of them simply left the profession. That is a 23% increase over the previous year of those leaving. Of the retirees who went on pension, there was approximately a 20% increase in those who took a penalty and retired early, rather than stay until they could collect an unreduced pension. One might speculate that this could mean many left because they just couldn't cope or didn't want to deal with the heightened expectations and poor working conditions, or didn't feel sufficiently appreciated or compensated for the job they were doing.

Consider also compensation for teaching. It is the only profession that has a 10- to 14-year probationary-type pay scale. I know of no other form of employment where it takes this long to attain the top wage for a similar job. A large number of university graduates, particularly in the sciences, maths and computers, could enter the workforce in those areas, commanding a much higher starting salary with superior long-term expectations for their future recompense. Even within the teaching profession, many other countries are competing for our well-trained graduates. Various states south of the border are offering generous signing bonuses, enhanced wages and waiving green card requirements.

Teachers who are trying to cope with the changes are facing burnout and are making greater use of our health care services. There is a much higher use of sick days, a higher incidence of use of certain drugs and medications within the health care plans, as well as use of services such as chiropractic and massage. Many have asked for reduced schedules and many are taking leaves of absence. LTD claims for teachers are the highest in the industry and over 50% are made for stress and mental health concerns. In the private sector there is a claims rate of seven per 1,000 in LTD claims. In education, the rate increases to over 17 per 1,000. However, in our particular board, the Waterloo Catholic, our current rate is almost 30 per 1,000. It is obvious that many teachers are starting to break under the pressures and stresses of the job. Inadequate funding is creating increased workload and stress situations that are proving hazardous to our teachers' health.

The following recommendations are made to encourage new people to enter the profession and the more experienced teacher to stay in the rewarding career of education. With the huge number of retirements and the constant turnover of new teaching staff, we need the following things to happen in order to stabilize and strengthen education in Ontario to the level it once was not so long ago:

We recommend that sufficient PD time and funding be provided in order for teachers to receive the necessary in-service on new programs and initiatives during the workday, but when children will not be negatively affected by their teacher's absence.

We recommend that the funding model be adequate to allow for a reduction in split-grade classes.

We recommend that there be a reduction in all class sizes in all grades, and that the maximum class size cap for each division be determined.

We also recommend that some funding be used to promote the education system and the career of teaching.

Mr Brydon Elinesky: More from the elementary perspective, as John mentioned earlier, it's our belief that education is not a cost but an investment. Although the government and the federations have had many differences of opinion, we do have one major goal in common: the current and future success of the students in our care in Ontario's education system. We want our students to become good citizens, to be active participants in society, to contribute to the economic well-being of the province and to lead productive lives in their own eyes.

There are many factors that will come into play as the lives of our students unfold, but the grounding we provide for them in the early years of their education will be a significant determinant in their life experiences. No matter what course their life takes or what career path they choose, they will require basic tools, skills and attitudes to attain the goals stated above.

Everyone agrees that literacy and numeracy are critical to building success in today's society. Fostering an enthusiasm for learning is often forgotten as one of the keys to success. Regardless of the focus, from formal education to learning the art of cooking as a hobby, the love of learning is a prerequisite for success. Elementary teachers do this every day. It is not only the curriculum skills that are taught in our elementary classrooms, but it is also the life skills of how to learn and how to solve problems that are taught as well.

Opportunities are also provided on a daily basis for students to work with and to get along with others. All of these are essential to the end result of developing caring, responsible and productive citizens. The investment that is made in the early years of a child's educational career will determine the success of this province. A wise investment will in fact reap long-term benefits for all. In order to ensure that our goals are met, we must make a serious investment in our early learners.

There are a number of areas where this has to be done, and one of them is class size. Many studies have shown that small class sizes, particularly in the early years, lead to improved learning for our youngest students and, as a result, future savings for the educational system. The Tennessee Student-Teacher Achievement Ratio, the STAR project, and the California initiative to reduce the kindergarten-to-grade-3 classes to a maximum of 20 both proved overwhelmingly that the following occurs:

Students in smaller classes in kindergarten to grade 3 were six to nine months ahead of their counterparts in larger classes in math and reading by the time they reached grade 4, and the results were cumulative, as they were over a year ahead by the time they reached grade 8.

Students in smaller classes participate more in school and have fewer discipline problems.

There are more opportunities for students to problem-solve with others and to take on added class responsibilities.

Teachers are able to cover curriculum faster and in greater depth.

Early identification and intervention for students with learning difficulties is made possible with smaller class sizes.

Although smaller classes cost more, the long-term benefits are irrefutable. Fewer dropouts, less need for expensive remediation in subsequent years and fewer repeated grades are the savings that will be realized. It will mean that our graduates will be more successful, with a resultant reduction in the need for social assistance programs. Spending money now on lower class sizes will save huge amounts in the future.

The government moved in the right direction last year by investing $100 million to reduce class size to 24 in the primary grades. The next step is a plan to continue that reduction to a goal of a maximum of 20 in the primary grades by 2005.

In the Waterloo Region District School Board, the importance of the low class size at the primary levels is recognized, and the class size maximums are lower in those grades than the funding formula allows. In order to accomplish this, however, the board has significantly raised the class size averages for grades 4 to 8. This works to counteract the positives gained in those early years. Only providing the funds necessary to reduce the overall class average in elementary grades will reap true benefits.

Specialist teachers are also needed. Funding more resources, particularly more teachers, is another successful investment strategy. Locally, we've had a significant reduction in the number of specialist programs. For the 2001 school year, there will be a reduction of more than 70 teachers within the elementary panel of the Waterloo Region District School Board. These reductions will occur in the areas of teacher-librarians, design and technology, family studies, guidance and special education. These are not so-called frills, but they are necessary components of complete education for our students.

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The reduction in teacher-librarians will mean less access to books and reading as well as another resource for the classroom teacher to assist with the delivery of program. The loss of our guidance staff at the kindergarten-to-grade-6 level means the opportunity for intervention at the earliest years, when it is most effective, will be gone. Further reductions to the number of special education teachers will also have a significant impact on our students. The long-term costs of such reductions will be enormous. Removal of the design and technology and family studies classes deprives the students of practical applications of mathematics and literacy components.

Although there have been no further reductions in the ESL programs in Waterloo region, the current funding does not address the needs of our community. Educators involved with meeting the needs of our students claim the census data used for the grant entitlement is flawed since it only addresses those students five years of age and older. We have many students enrolling in the kindergarten classes who come from families where English is not spoken in the home even though the family has been in the country for several years, making their children ineligible for ESL funding. The region of Waterloo now has the third-highest immigration rate in the country. As well, we have a significant Mennonite community in which English is not spoken in the home. Both of these factors make it necessary to change the rules for grants to make facility with the English language upon entering the school system as the determining factor for ESL funding and to start that funding in junior kindergarten. We cannot continue to ignore this significant problem and still espouse literacy of all Ontario's citizens as a goal. Unless we address the needs of all of our children in the early years, we will not be able to rectify the problems later on.

The government also must make a commitment to an investment in junior and senior kindergarten in order to ensure the future success of our students. The government's own Early Years Study recommended additional resources for early learners, and the recent Education Improvement Commission also made recommendations for a $1-billion investment in full-day junior and senior kindergarten. Funding all-day senior kindergarten is the first step in the right direction for funding, and the next would be to fund full-day junior kindergarten as well.

Investing in our students now will result in long-term benefits for all of Ontario. The savings that will be realized by making the above-mentioned investments in the education of our students, particularly in the early years, is sound financial strategy. It is not just the right thing to do, it is the common-sense thing to do.

Thank you very much for hearing us. We have a few minutes left, so we would gladly take any questions.

The Chair: You're quite right. We have one minute per caucus and I'll start with the government side, Mr Arnott. Now make it tight.

Mr Ted Arnott (Waterloo-Wellington): I've got five minutes of questions.

Thank you very much for your presentation. Brydon, you said, "Although the government and the federations have had many differences of opinion, we do have one major goal in common: the current and future success of the students in our care in Ontario's education system." I completely agree. I think we need to get beyond the disputes that we've had in recent years, whether it be the pension dispute that took place with respect to the Liberal government in the late 1980s or the social contract dispute that took place under the NDP or the changes that our government has initiated. We need to work together for the benefit of the students. I want to thank you for your presentation today and the tone that you've brought forward.

I want to ask you about ESL funding, because I know that in Waterloo region we are underfunded with respect to ESL funding. What are we presently receiving, and what does your federation think we need in order to adequately meet the needs of the students in Waterloo region?

Mr Elinesky: What we currently need is the recommendation we have that what we do is allow the students to come in, and what we look at is what their language is when they come to school, not how long the family has been in Ontario. If we do that, I believe then the funding amount will be correct. It has to start with junior kindergarten, not with senior kindergarten.

The Chair: Thank you very much. The official opposition?

Mr Hoy: Thank you very much for your presentation this morning. I will just make a quick comment about the Mennonite community in your area that you mention. I also have a significant Mennonite community, and I've heard of this problem, the language aspects that you're talking about.

I think, as legislators, we're all aware of the numbers of persons who retired from the teaching profession recently. But I am really struck by your information today that only 60% left to a retirement pension. This is quite serious, I would say, that people are retiring simply to exit the teaching profession without a secure pension behind them. I think it really does speak to the situation quite graphically. I wasn't aware that this was occurring at this percentage and, as well, a 23% increase over the previous year.

I have visited elementary and high schools on many occasions since 1995, and I know of some of the stressful situations that exist, but this is quite an alarming figure, in my mind, at least, and I am certain for many members here.

Mr Christopherson: Thank you for your presentation. I've mentioned before in other communities, and I'll mention it here again, that I've had now on two occasions, actually, physicians in my riding, and I represent Hamilton West, mention to me out of the clear blue, unprompted by me, that they've never had so many patients who are teachers who are off on stress leave. So when I see your stats, and we've seen others in the province, it shores up what I'm hearing anecdotally is happening out there. It's a shame we can't find a better way to phrase it, because there's nothing that will hurt the system even more, I would say, than the funding cuts if the whole array of teachers become so demoralized that they lose their enthusiasm. If the enthusiasm is lost, all the money in the world is not going to give our students, our children, what they need.

I also wanted to join with my colleague Pat Hoy and say, again from Hamilton, you can appreciate that ESL is a huge issue. In fact, we've had other presenters come forward and say, "If you don't resolve this issue for those children, the entire system could vaporize and it wouldn't make any difference because they're not getting it anyway." At a time when the federal government is increasing immigration in recognition of our skilled trades shortages and the population growth we have to maintain, and grow to allow this to happen, you'd almost wonder if there couldn't be, just to make the point, a human rights complaint that, where equal opportunity to accessibility of quality education is supposed to be assured to every child, by not funding this in the most obvious, practical fashion, there's a human rights infringement.

I've been to schools in my riding, Pat, that have got thousands of kids who are not taking in the education system they should because they don't speak the language and they're not getting the ESL courses they should get to offset that. It's heartbreaking, and there's not a darned thing any of us can do. It's all in their hands. It's just, as you say, a question of recognizing -- base your funding on the need after testing all the children rather than saying, "Three years or five years you fit in this box." Well, guess what? It doesn't work that way. There are a lot of people moving to our communities, having been somewhere else first, and the government itself has said it takes about seven years to become totally proficient in a second language, especially to have that language as one you're learning in.

Thank you, Chair.

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

LONDON CHAMBER OF COMMERCE

The Chair: Our next presentation is from the London Chamber of Commerce. I would ask the presenters to come forward and state your names for the record, please. On behalf of the committee, welcome.

Mr Gerry Macartney: Thank you, Mr Chair. Ladies and gentlemen, thank you for allowing us the opportunity today to share our views with you. My name is Gerry Macartney. I'm the general manager of the London Chamber of Commerce. I'm accompanied today by the president of the chamber of commerce, Mr Wayne Dunn; and our director of liaison, Mr Todd van Rees. In the audience are Don McCallum, our vice-president of policy; and Anne Creery, the chair of our economic policy committee.

The first section I'm going to turn over to our president, Wayne Dunn, who will tell you a little bit about the chamber of commerce and get into our first issue of the day, which is debt.

Mr Wayne Dunn: Thank you, Gerry. It's nice to be here today. I'll just give everyone a synopsis of what we are all about. The London Chamber of Commerce is London's broadest-based business organization, with nearly 900 member firms, employing over 50,000 people in London and region. Our mission is to be the voice of business, contributing to economic prosperity and quality of life in London and region.

In that role, we speak out regularly on behalf of our members on matters of local, provincial and federal legislation that affect business and the business climate. We are pleased to welcome the members of the standing committee to London today and to offer our views with regard to the forthcoming provincial budget. To that end, our presentation will focus on five key issues that we believe should drive Ontario's fiscal agenda over the next few years: government debt, tax competitiveness, investment in infrastructure, education and training and health care. Each of these issues is provincial in scope, but with regard to education and training and health care, we will offer some suggestions that focus on circumstances here in London.

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I'll speak on government debt to begin with. Then I'll turn it over to my colleagues for the other issues.

The elimination of the provincial deficit has been a substantial achievement, and we congratulate the government on this accomplishment. From a business perspective, however, the job remains unfinished until we begin to make significant inroads on the reduction of our accumulated debt of more than $114 billion. The current debt is at present absorbing 15 cents of each revenue dollar, compared to a provincial-Canadian average of 12.6 cents. We'd like to see that move downwards.

While some may see debt repayment in competition with goals of tax reduction and program spending, we believe that in the long term a priority on repaying debt can actually enhance the opportunities for both tax reductions and strategic investment. Debt repayment has the added benefit of reducing the amount of existing debt to be refinanced, ultimately freeing up funds for tax reductions and program expenditures. In the fiscal year 2001, for example, the budget called for Ontario to spend more than $8 billion to refinance existing debt. That expenditure compares with $7.7 billion originally budgeted for operating expenses at Ontario hospitals.

To put the situation in perspective, Ontario's debt-to-GDP ratio is currently at 28%, nearly twice its historical average of 15%. Like the deficit, the debt will not be eliminated overnight, but the fiscal flexibility afforded by reducing the burden of debt refinancing means that debt repayment should be a top priority.

The London chamber's recommendation to this committee this morning is as follows: that the provincial government target a reduction in the provincial debt-to-GDP ratio from the current 28% to 15% within five years.

I'll now turn it over to Todd to speak on the taxation issue.

Mr Todd van Rees: The Ontario government is a leader among Canadian jurisdictions working to achieve competitive corporate and personal tax rates. Our member businesses and their employees have benefited from the government's decisive action in this area. We were also pleased that the government responded to the Ontario Chamber of Commerce's request for a business advisory panel on corporate taxation, and we look forward to the results of its review of Ontario's business taxation system.

In the meantime, however, we urge the government to continue in its efforts to reduce the tax burden. Our members compete with businesses from US border states as often as with firms from the rest of Canada. Tax competitiveness, like business competitiveness, is an international, not just regional or national, phenomenon. We would further note that the emerging consensus in the US federal government for substantial tax cuts will only increase the challenges to our members competing for business and skilled employees with US firms.

Our recommendations in this area are as follows: within a framework of enhanced debt reduction, the government should continue with its plans to further reduce the tax burden on businesses and individuals. Such plans should consider tax competitiveness in an international context, particularly in relation to those US states that make up a large percentage of Ontario's international trade. Possible priorities for change could include the elimination of the small business deduction clawback; raising the threshold for the highest income tax bracket in Ontario; and strongly consider the elimination of the provincial surtax.

Our comments on education and training are as follows: stable economic growth and investment flourish when people are afforded access to education and training that result in improved basic skills, specific occupational training and lifelong learning. Business prospers when it has access to a sufficient number of individuals with the tools necessary to produce, discover, invent and expand product lines and grow new markets.

Ontario's community colleges play a key role in developing skills in critical thinking and the technical and professional expertise that our member businesses need in their employees and managers. That role must be recognized with appropriate funding. The government already has indicated its willingness to reinvest in post-secondary education and training through SuperBuild, the access to opportunities program and other initiatives. The spectre of the double cohort, which will necessitate a significant new investment by colleges in learning facilities, equipment and staffing, looms closer. This phenomenon, combined with rising labour market pressures and a demand for more training and lifelong retraining, will place community colleges' operating budgets under increasing strain.

The London Chamber of Commerce concurs with the submission from the Association of Colleges of Applied Arts and Technology of Ontario, which points to the significant reduction in per-student funding over the past 10 years.

Our recommendation in this area is as follows: Ontario needs to ensure that colleges are able to continue to provide their students with the skills and training they need. We understand that the Investing in Students Task Force will be offering recommendations to the government on this issue, and further note that the Association of Colleges of Applied Arts and Technology of Ontario has also brought forward suggestions on this issue.

Therefore, we recommend that the provincial government respond to the impact of the double cohort on operating costs at Ontario community colleges by offering the appropriate financial support.

Mr Macartney: I'll speak to the investment and health care initiatives.

Investment in the physical infrastructure that enables economic development and growth is a primary responsibility of government at all levels. The London Chamber of Commerce was encouraged by the establishment of the Ontario SuperBuild Fund. We believe that this approach, leveraging enhanced public sector investment through private sector partnerships, is the appropriate strategy.

We do, however, share the concerns expressed by the Ontario Chamber of Commerce in its paper released earlier this month recommending a study of the issues around the creation of a transportation authority for Ontario. Investment in transportation infrastructure is important, but it's vital that such investments take place in the context of an overall strategy. Clearly, some distinctions can be drawn between purely local and regional transportation issues and those impacting on international trade. But ultimately, all such issues are connected, and the recommendation for a transportation authority with representation from all levels of government and the private sector makes good sense.

We recommend therefore that the government implement the Ontario Chamber of Commerce recommendation for a study of the prospects for establishing an Ontario transportation authority. I have copies of that paper here today if you need them. I think they were presented to the government on February 13.

I apologize in advance for the lengthy preamble on health care but it goes to the importance that the health care industry plays in the economy of London, so I'll take a little time on that one.

The province of Ontario will play a critical role in the future and quality of the health care sector in Canada. For its part, London, Ontario has historically enjoyed a respected place among the world leaders in health sciences. As a result, we have also benefited from the many economic spinoffs associated with a strong health care sector. Research and development, the creation of new biotech businesses, investment and job creation can all be tied to how well or how poorly our health care sector performs. Typically, for every dollar spent by hospitals, between $2 and $3 is generated in additional economic activity in the community through purchasing, construction, taxes, consumer spending etc.

There is also a direct correlation between the wellbeing of our hospitals and the future sustainability of our universities and research institutes. The three often work hand in hand on research projects and joint ventures and one can be weakened without the sustained strength of the others. London's hospitals have garnered well-deserved credit for their efforts in being the first in Ontario to respond positively to the challenge of restructuring. Not only did they embrace change, they demonstrated their leadership for all to follow throughout the province.

In our 1998 position statement, Health Care Infrastructure Plays Key Role in London's Economy, the chamber attempted to compare investment in health care facilities with that of traditional infrastructure expenditure, namely roads, sewers and bridges. The belief was, and still is, that if we don't look after our health care infrastructure, it will shrink along with the economic advantages associated with a healthy health care sector.

Communities like Calgary, Edmonton and Winnipeg are poised to pounce on any health-related economic advantage they can wrestle away from Ontario and indeed London. On a broader scale, Rochester, Minnesota, Boston, Detroit, Cleveland and Buffalo, to name a few, are continuing to look for opportunities to capture a larger share of Ontario's health care market.

The chamber's infrastructure statement goes on to point out that investment in the health care sector is an investment in an environment that promotes growth in new ideas, new research and development, as well as education and patient care that will enhance the wellness, spirit and quality of life for the millions who rely on its sustained viability.

Any sector that contributes nearly 14% to a community's overall economy and 13% of the total tax revenues, as is the case in London, warrants particular attention, in our view. With over 879,000 clinical visits per year, which translates into $44 million in local spending -- a fact which is not lost on suppliers, area retailers, hoteliers and restaurants and, I might add, local governments and provincial governments -- our hospitals need the continued support of our provincial government. What may be more important to London is the added economic potential that a sustained health care sector can have on our futures.

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Our recommendations are as follows: the London Chamber of Commerce joins with area MPPs Frank Mazzilli, Dianne Cunningham and Bob Wood in support of hospital restructuring at London Health Sciences Centre and St Joseph's Health Centre. It's now clear that the original cost sharing agreement whereby the Ministry of Health and Long-Term Care would contribute $150 million of the $280 million projected cost must be revisited due to unforeseen costs and a need to respond to a longer-term vision. Changes to the building code requirements, in conjunction with asbestos removal and the increased cost in construction material as well, as associated inflation costs over the past three years, make it critically important to revisit this agreement.

Renovations to certain facilities are no longer feasible and new construction will have to replace older, unsuitable buildings. Furthermore, more extensive renovating for patient flow and efficiency needs is required. A revised plan by the joint committee estimates an increase in costs of over $90 million to cover these additional expenses. The ministry leaders have visited the site and recognize the need to advance these projects.

While Londoners and area residents are unwavering in their support of the restructuring initiative, there is a concern that the $90-million shortfall cannot be absorbed through more fundraising. The community partners involved have reached their limit in terms of their contribution capabilities, and for this reason we are requesting that the ministry address this issue forthwith. This is a matter of some urgency as we focus our attention on providing the most efficient, professional and dedicated patient-centred facility available, all within certain time constraints.

Projects are currently at the ministry offices, and more projects are scheduled for the months of February and March, but stand unapproved. Decisions are needed now to advance hospital restructuring in London and in Ontario.

We therefore respectfully ask that you give serious consideration to increasing the Ministry of Health and Long-Term Care's financial commitment to this tremendous undertaking. With its completion, London would become the site of the first fully restructured facility in the province and a model for the future of Ontario.

On behalf of my colleagues today and the members of the London Chamber of Commerce, I would like to express our appreciation for the opportunity of sharing our views with you, and we trust that you will report back on your findings here today.

I would also reiterate our appreciation for having chosen London as one of your key stops in this consultation process, as we believe London and its people represent a true reflection of the Ontario mindset.

We'd be pleased to respond to any questions that you might have.

The Chair: Thank you very much. We have four minutes per caucus.

Mr Kwinter: Just a couple of observations. In your presentation you talk about an $8-billion interest charge on the debt. The number, really, for this year is $9.4 billion, so it's up about $1.4 billion over what you estimate. You and others -- other chambers of commerce and tax organizations -- have actually targeted the fact that one of the top priorities has got to be the reduction of the debt. That crippling service charge, which is the third-largest item in the budget, really restricts the government's ability to do some of these other things.

You state that is your top priority, and then you go on to list all of these other things where you need increased funding. We hear that all the time. Of every single group that comes in here, no one has ever asked us to reduce the funding that they get. They all come in and say, "We need more funds for education," "We need more funds for health care," "We need more funds for child care," or "We need more funds for poverty." Then we have other groups, like yourselves, that come in and say, "We have to reduce the debt."

When the budget is struck, these numbers are all projected on what the best estimate is going to be of our gross domestic product, because there's a direct correlation to tax revenue and the growth of the economy. Those numbers are being reduced literally on a daily basis. We started out at 3.2%. The Treasurer has now announced it's going to be 2.8%. I saw a report in the paper today where an economist is saying it's going to be 1.6%. So we, as a committee, and the government have got to cope with a situation where the projections are going to be less than anticipated, and that's going to put tremendous pressure; it's going to make it very difficult to even keep a balanced budget, let alone address all of these pressures that people want. Do you have a comment? If you had to pick one item, would it be debt reduction or would it be some of these other things that you mentioned?

Mr Macartney: I guess the advantage that the government has today is that it has reached that point in its history where it has the fiscal flexibility and nimbleness to respond to that question. We think they've done a good job to date of, first of all, eliminating the deficit and contemplating further tax reductions. The difficulty with leadership, of course, is making those tough decisions. I know that Paul Martin uses the expression "suck and blow" and we anticipated that coming from certain individuals on this committee today.

We think that you can spend strategically within the current spending envelope and continue along the path of debt reduction and tax reduction at the same time. I agree, Mr Kwinter, that if the economy changes dramatically or it tends to mimic that of the United States, we're going to have to make some reassessments on spending and on debt reduction and on tax reduction. I think they can all be done incrementally but in a balanced way.

Mr Christopherson: I want to pursue the same line. You said we might have to do a reassessment. I think the question that was being posed was, if you do the reassessment and realize you can't do everything, which is the priority? Just to put a local reflection on it for me, on the front page of the Hamilton Spectator today is, "City Must Spend $2 Billion on Sewers: Taxpayers Face Massive Bill for Hamilton's Aging Infrastructure." I can tell you, one of the leading proponents -- it's interesting. I'm one of those who have been arguing for a long time we need to do this. It makes good economic sense, it helps local business, and of course the chamber is on side and everybody is recognizing this is a priority. But if you do this reassessment, as you just mentioned, and you can't do everything, does that mean you would want to change what you've said is the top priority?

Mr Macartney: Let me give you two responses to that, Mr Christopherson. One would be from a local perspective. Clearly, health care has such a huge impact on our economy here that we'd be remiss not to emphasize health care once again as our local priority. If you ask me the question on a provincial basis, which would be the number one priority, if left with only one choice: debt reduction.

Mr Christopherson: But that would mean in effect --

Mr Macartney: I know what the implications are.

Mr Christopherson: You realize you wouldn't get your funding for your hospital, we wouldn't get our infrastructure, and we wouldn't get the money we need for education.

Mr Macartney: But indirectly you would. I think the point is that by emphasizing debt reduction and reducing the amount of debt servicing charges, more of those dollars are then able to go into program spending.

Mr Christopherson: The difficulty I have is that we have almost six years of experience under that kind of thinking. I pointed out the other day that it works fine on the bottom line equation -- when you take a look at tax rates and business activity etc, you can make that argument -- but on the other side, it hasn't worked. The money has not found its way into our health care system. That's why you've got a crunch. It hasn't found its way into our education system. That's why we have teachers coming in and the university coming in before them, saying they've got to have this money in order to do these things. So that didn't work. I think it sounds good. That was during booming economic times that the one equation worked, but the other one didn't.

Now if we're into a situation where there's no money at all to be had, you're suggesting we're still going to leave this sit. I don't understand from a business case how it makes sense to let the infrastructure of Hamilton and every other major urban centre in Ontario continue to fall apart; not to meet the needs of business in the education system, in terms of the skilled workers we will need in the future; and not to stay on top of our health care, which is one of the key attractions of doing business and living in Ontario. So help me. I can argue it from a social point of view, but I can also argue it from a business point of view. I don't understand how it makes good business sense.

Mr Macartney: I think your question has gone from which would our priority be to your assumption that if we picked a priority, it's at the cost of all other things, and that's not what I heard. We would not presume for a moment that if debt reduction became the single priority of this government, all other things would stop. We assume the economy is going to click along reasonably well.

Mr Kwinter, you're quite right, we've heard economic forecasts from a number of different sources. But I propose to you that if we had all the economists lined up end to end -- you've heard the story before -- you'd have a whole bunch of different forecasts ranging anywhere from 1% growth to 4% growth, and that's today. Those are current projections by the economists in this country. So I'm not sure where it's going to take us.

I can't answer your question, Mr Christopherson, on speculation, only that the math does work. In practice, I'm not sure. We'll have to be watchful and guarded in that regard.

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Mr O'Toole: The chamber of commerce is a very important commentator on business and community, so I commend you on your contribution here today and to your communities as well.

I do hear the three points. The debt issue: it may be better to speak about it as the deficit issue that was and the debt issue that is now. There is more work to be done, clearly, and they are a fiscal approach. They're certainly a longer-term approach to solving our infrastructure problems. I do hear the importance of education. We hear it -- as has been said in most communities -- and the health care issue, as being tops. So you've clearly identified the issues.

Just on a very important local issue, in fact I guess it's provincial: the whole issue of education and training -- one of your comments -- and the double cohort. In the broadest context of strengthening the curriculum to address the new knowledge-based economy, that has been part of what the education quality changes are about, and also to deal with the double cohort, the restructuring of our school system to make it common with other provinces and, in fact, better. The SuperBuild fund has over $1 billion to create spaces for the double cohort. We heard the president, Paul Davenport, say this morning that they are in fact well underway to meet that challenge.

I want to talk in general terms for a moment, respecting your thorough presentation, about the issue of competitiveness. It really comes down to a dilemma, the dilemma being which came first, the strong economy or the strong social infrastructure. I've heard you say here that the economy and its competitiveness in all its forms comes first; that government has no money itself, it just redistributes the money it collects from you. We've always said that a strong economy is the first part to building a strong society. In fact, if you look at the overall approach of the government -- and it's hard to think that when I hear the daycare workers and the groups that work with homelessness and poverty; I am just as concerned. However, my solutions are, unlike Mr Christopherson -- unfortunately, he's not here -- more about the longer view.

You mentioned the debt and the load and how the debt doubled. We know the debt doubled. The debt doubled because of ineffective operating budgets and the inability to make tough choices. That's very difficult. Humanistically, compassionate choices are made. These are priorities that you were being asked about. So I commend you for giving a very thoughtful review of current government policies. There is a very difficult bridge ahead of us. Hopefully, we will all work together.

But the other part, health care, to mirror what you've said, the spending in health care was $17.4 billion. That has grown to almost $23 billion. That's almost a 30% increase, in quick numbers.

We are making investments in education. There has been no billion dollars taken out of education, despite what you hear. That's the bottom line. How it's spent may be an issue. If you have a minute or two to respond, just to see if I'm reading your message correctly, I would appreciate it.

Mr Dunn: If I can speak to that, I co-own a business that employs 70 people in London, and I can assure you that in my own case a healthy business means doing what we can in the economy for social issues, or whatever the case may be. In our own situation, we've been able to eliminate our debt at our company. By doing so, we can invest a lot more in machinery and people. Regarding social issues, we contribute a lot more to the local economy, various charitable organizations and such. I think that's a top priority. It's not even for my own business; it's through a chamber and through a whole community. That's why I would encourage, even on the debt situation -- it's the cart before the horse. We have to tackle this debt, and as we do it, a lot more money will flow for other sectors, and we can spend it wisely.

The Chair: We've run out of time. On behalf of the committee, thank you very much for your presentation this morning. Gerry, nice to see you again.

Mr Macartney: It's nice to see you again, Marcel. It's great to have you in London.

The Chair: It's our pleasure to be here.

INVESTING IN CHILDREN

The Chair: Our next presentation is from Investing in Children. Could the presenter come forward, and state your name for the record, please. On behalf of the committee, welcome.

Ms Jan Lubell: My name is Jan Lubell, and I am the project director of several London initiatives, which after Thursday of this week, are going to become an amalgamated whole: Investing in Children, Kids Count and the London Investment in Education Council. For the past decade, these three organizations have assumed a leadership role in facilitating system responses and solutions to local issues having to do with the growth and development of our children and, ultimately, the health and prosperity of our whole community.

Investing in Children was pleased to be named one of five provincial demonstration projects for the early years project in the fall of 1999. We are very proud of the accomplishments and success we have achieved in terms of this project. In 1997, Kids Count was the recipient of the Peter F. Drucker Award for innovation in the non-profit sector, recognizing work in building capacity in disadvantaged neighbourhoods. The London Investment in Education Council has initiated and facilitated a number of successful ventures in London, including Take Your Kids to Work Day, Do Jobs Grow on Trees? and the Bridges program, all of which relate to school-to-work issues.

By raising issues and community awareness, by building coalitions among all sectors in the community to support planning and change processes, and by working to strengthen the capacity of our neighbourhoods and their residents to seek solutions to local problems, we have facilitated collaborative partnerships for change and a top-down, bottom-up approach to problem-solving. We then go on and advocate for the steps to make the change happen, and any programs developed under our leadership are incubated only to a position of strength and sustainability. Our role is not to run programs but to hand them off to the community for further continuation.

Another goal of our initiative -- and we're quite aware of the need to evaluate our progress. We want to answer critical questions: how do we know we've achieved what we set out to do, how are we accountable for resources spent in pursuit of system change, and do the changes we've proposed really make a difference? Good evaluation that considers programs, processes and policies takes time. We are well on our way with a number of baseline measures in our community. We've done a first-step community report card, which I think you'll find in your folders that I passed out, and we've done, through the early years initiative, local readiness-to-learn measures for all of our kindergarteners in London.

From this vantage point, I am pleased to have the opportunity to raise resource allocation issues with you on behalf of my organization. I have attached a list of members, and you can see from the list that we are a collaborative group of all of the key local leaders in our community. We have people from all sectors: education, health, social services, recreation. We have business leaders. We have a whole range of people. We're all working together to try to make a difference to children and their families in London.

Very briefly, I'll just run through the few recommendations we have. They have more to do with the "how," I think: some ideas for how government programs can come to groups like ours which are dealing with services that deal with people.

We ask you to consider the following issues: ensuring and supporting local authority for decision-making and program development; providing government support to operational infrastructure needs of local agencies, including staffing and administrative costs, not just resources for program innovation. This speaks to the sustainability issue. We want to see attention given to prevention programs, providing sufficient and continuing supports to those who carry out activities at this very early level of capacity-building. We want to have you think about providing financial support to designated groups or organizations which can assume local accountability for improving community awareness, building coalitions for project support, ensuring collaborative service delivery and evaluating the success of local programs. Lastly, we'd ask you to think about multi-year funding streams and taking away some of the departmental barriers for funding between health, education, recreation and social services, which to us at the local, "doing" level are probably more critical than you may imagine at the theoretical, provincial level. So I'll just continue; I'll basically read what I have.

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We seem to be in a time of changing paradigms here. The first paradigm is the family responsibility one. This reflects the view that it's the family unit that should and must take care of its own children. This outlook is primarily supported through tax incentives, school supports and child care policies. London's own city council tends to have that viewpoint about families taking care of their own children.

The other perspective -- and by our name, Investing in Children, you can see that's the one we subscribe to -- is called the "investing in children" paradigm. It calls on all sectors within a community to focus on the needs of children -- all and anyone's children -- and to provide financial supports for programs that assist children's growth and development. This could be referred to as the "it takes a village" viewpoint. The direction of provincial funding dedicated to the early years seems to reflect this particular value.

Locally, I think we've been good about accommodating both perspectives and knowing that in the changing world no one way is going to achieve anything. So I don't think it's our purpose to say we need to be all on the bandwagon for one or another. I think living with pieces of both is something that we have done and will continue to do well.

One of the issues that's critical in our community today -- and I'm hoping if you hear nothing else, it's going to be this one -- is the issue of local authority. It's been raised prominently by the new directions and guidelines relating to the early years initiative. Those of us who were demonstration projects enjoyed a great deal of local autonomy to build and make decisions around what was good for our communities. Although we worked clearly within provincial goals and guidelines, and provincial visions, that freedom to act as was correct in our own communities has resulted in collaborative integrating solutions for local program development. It's been centred squarely around the needs of young children and their families. Our accomplishments promise a culture change in terms of how we approach and support early child learning opportunities.

The funding model recently announced for the early years challenge fund reflects, on the contrary, a very controlling top-down process and provincial ownership, rather than what we think ought to be the desired provincial leadership. It does not, in our view, support collaborative processes, cross-sectoral coalition-building or a system of shared contributions.

We'd like to call for a fairly rapid transition back to local authority, both in reality and in perception, and think this can be maintained with due recognition to the province for its mandated leadership. It can be maintained within guidelines that protect principles such as inclusion, access, availability and multi-sector contributions. We understand that the vision and its management are provincial roles. In this case, we applaud the province for taking a good step in terms of early years. However, we would caution that a top-down, bottom-up approach will derive greater local buy-in, better processes and a greater accomplishment of goals.

So local authority to make funding and allocation decisions based on local needs and meeting a local service plan and operating model is strongly recommended.

The issue of sustainability is another one that comes to the fore when we're working in an arena where we're actually trying to make things happen locally. Over time, we've had a sizeable number of innovation opportunities that have come from the province to communities in a variety of sectors. Generally, these are greeted with enthusiasm and energy as local groups undertake development processes to try to put them in place. The work is usually supported by start-up or short-term innovation funding. However, it's too often been the experience in our community that by the end of the pilot phase either not enough change has happened at the community systems level or no change in choices has been made at individual agencies' program level. The innovative structure fails to continue for want of financial support. Our community, like others, is littered with good intentions that have been tried and failed.

Another reason why programs die after a spurt of initial activity is the lack of longer-term infrastructure support from the government level. Program elements might be picked up through donations and existing organizational staffing levels might pick up incremental increases for the short term. However, without sufficient funding to support longer-term operations, the programs simply expire. We've learned through the demonstration projects for the Early Years that although businesses and the voluntary and service sectors are able, and in fact quite happy, to pick up in-kind supports or cash toward the trial phase of programs or one-time funding for tangible items, they simply can't be counted on to carry staffing and administrative costs nor unending program costs.

As a remedy, we would recommend that pilot funding for new programs ensure ample attention to staff and administrative issues, not just to program components. We're recommending also that you think about multi-year funding. This would give the community a longer time to build collaborative structures relating to sustainability, to assess opportunities for shared contributions toward program continuation and to evaluate which parts of the pilot result in greatest benefits. The evaluation component could certainly be a requirement for continued infrastructure support. It would seem that this approach would speak to supporting innovations so that they might really have a chance to work. Otherwise, the investment of resources in the short-term innovation models is indeed wasted.

In addition, it would seem that every provincial regional unit would benefit from financial support to enable some sort of local group that could have accountability for leading and in fact driving the move toward program integration, increased collaboration, community awareness about exemplary practices and making new solutions happen.

This is not a call for a return of the old style of information-sharing, service-provider planning groups nor is it a call for heavy infusions of resources to well-intentioned groups that meet together without an accountability for producing change. But it is a recognition that change in a community does require time, resources and a leader to make change happen. It recognizes that existing agencies, that themselves feel cash-strapped, cannot find contributions or resources to dedicate to this function. Finally, it recognizes that a group of community members outside any agency may be the best vehicle to achieve collaborative change.

What the group will look like in any community depends on what already exists, where it derives its mandate, to whom it is accountable, and for what purpose. In London, it could be the Early Years Council, it could be a body somewhat like our former Coordinating Council for Children and Youth, or it could be something like the one that I'm heading up now, our own current initiative of Investing in Children/Kids Count/London Investment in Education Council. Supportive funding with a multi-year term gives the freedom to carry out activities toward agreed upon goals.

Prevention Programs: Our strong recommendation must be for greater attention to prevention-oriented programs for children and their families before they require very sophisticated, very costly out-of-home and therapeutic care; for greater operational supports for community-based groups that struggle with the daily, front-line needs of children and families and who do excellent early intervention work; and for supports for those needs that research tells us are important to children as they grow. We already know, from what is working in other communities, what works and we need to be able to do that: recreation, skill-building and cultural opportunities and activities, good nutrition, safe housing, mentored leisure time and leadership development activities. These are called the determinants of health and learning.

London has been proud of its many achievements relating to children and youth and has a good community capacity to continue this work. We are supportive and appreciative of recent provincial initiatives such as literacy improvement programs in schools, improved financial support to the children's aid society, early health identification programs for children, and focused attention on the Early Years project. The latter, especially, has great potential as a foundation for collaborative, cross-sectoral, prevention-oriented programming and for bringing about a community culture change about our children.

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In conclusion, then, we can ask the province to pay attention to several key issues that would greatly improve the efficiency and effectiveness of service delivery, would meet the demonstrated developmental needs of children, and assist in the culture change required to make the community systems more vital and sustainable.

As I said, it's not a question of asking for more money. It's a question of addressing the question of how: how the money comes down, how we're allowed to use it. Just to repeat, we're looking for local authority respecting decision-making and program development. We're looking for some attention and support to core operational needs, not just to program innovation elements. We're looking for greater attention to prevention programs, and hopefully over the long run -- we know from research some of the things that are being done do make a difference.

We're looking for the thought about supporting some specified local groups to assume accountability for this whole area of raising awareness, building coalitions, ensuring collaborative service delivery and evaluating the success of local programs.

Finally, we're asking that you think about multi-year funding streams. Otherwise, all these innovative ideas come upon an organization which needs to spend that year getting it up and running, doing it, evaluating and then searching for more funding to continue it. It's a lot to ask of any group in our city.

Thank you for your attention. I appreciate the opportunity to raise these issues and I'm pleased to answer any questions.

The Vice-Chair (Mr Doug Galt): Thank you very much for your presentation. We have approximately three minutes per caucus. We'll start with Mr Christopherson.

Mr Christopherson: Thank you for your presentation. On the conclusions, I know you made the point that you're not necessarily asking for money per se, but I did note that out of the five recommendations four pertain to funding one way or another. Correct?

Ms Lubell: I suppose you're right, yes.

Mr Christopherson: It's just important because, if there are things that can make a huge difference that don't cost anything, you could probably get automatic unanimous support from all of us and we'd do whatever we could to move it.

Ms Lubell: I was going to say, if you did the multifunding streams and gave greater authority locally to figure out how to do this collaboratively, then there's a shared contribution, there's a synergy in what people can contribute. I think that would do it without more money.

Mr Christopherson: Is it your experience that London knows already how to work? Some communities seem to have a really great network in them and there are others -- I won't get into names but there are some that are known for being very siloed and compartmentalized. I assume you're expressing to us that London clearly has that ability, has those --

Ms Lubell: London does have a very fine --

Mr Christopherson: Could you give other examples that are outside this particular --

Ms Lubell: Of working together?

Mr Christopherson: Yes, in an innovative way, where the local authority in decision-making made a difference.

Ms Lubell: I'm trying to think right now, and they involve Kids Count, let's say, that I'm also involved with. The school literacy programs now are certainly in that, K to 3. Because we were the demonstration project for Early Years, we came along and we've talked together. I had the occasion to address all the principals in the school system a couple of weeks ago and I've had many calls. We're trying to figure out how to do something different at that school entry level, working together among us.

We've got certainly the other organizations such as Merrymount Children's Centre, the children's aid, Madame Vanier. We've got all kinds of groupings of organizations that are working together. Now it happens that, through the Early Years demonstration project, we were able to raise $100,000 from businesses, from volunteer groups, and then that was matched. We've developed 25 neighbourhood centres for Early Years. This all comes about, not just through one organization or one person, but from all of us working together. It's an excellent community. I think London would be a good place to pilot some of these things if you wanted to. Over the years -- and I've certainly been working in the community for a long time here, and I think over the years we've had really excellent relationships and good working together.

Mr Christopherson: Very good. Thanks very much.

The Vice-Chair: We'll move on to the government side. Mr Arnott and then Mr O'Toole.

Mr Arnott: Thank you, Ms Lubell, for your presentation this morning. I've reviewed the material you've given us, and it's certainly evident from the package that you have substantial community support. That's a testimony to the work you do, but also to the efforts you put forward to bring that together, because it's not easy and it doesn't just come about by accident. So I want to compliment you on the work you've done.

I want to ask you about the issue of local authority that you mentioned. You've indicated that the demonstration projects for the Early Years program allowed for a great deal of local autonomy, but that the new early years challenge fund doesn't give you that same degree of autonomy.

If you could just illustrate that with a few examples as to how that's the case, that might be helpful for us as committee members to bring the view forward.

Ms Lubell: Maybe the easiest one is, in terms of developing a model for how we might meet the needs of these young children and their families -- we developed all kinds of committees and focus groups and whatever. Together with a whole variety and range of service providers and parents and business representatives, we came up with a model which is really a network of neighbourhood centres.

It involves a number of places making contributions. For example, Merrymount Children's Centre, which I'm really well familiar with because I used to be the executive director there for quite some time, does a program in the community. They said, "Why don't we take our program to your neighbourhood centres?" We talked to Orchestra London, we talked to the art gallery and we talked to the children's museum, and all of them said, "OK, we'll work with you and we'll be glad to go out into your centres, into your neighbourhoods and do programming with you." It's easier, certainly, to operate through one channel for all of them than to go to every one.

We arranged with Dr Barry Onslow at Althouse College and we have together developed a curriculum for family math for preschoolers. He's got a wonderful set-up. He's got an Esso family math program which primarily has been doing things for school-age kids, so we said, "How about preschoolers?" "Fine." So, collaboratively the curriculum was developed. The education students were trained to take it out into the community. We worked with community groups to develop where it would go. This is the kind of thing we've been doing.

The early years challenge fund now, as it's set up -- I may be reading it wrong, it's not quite in place yet, but it seems to me it's going to encourage organizations to apply for dollars to bring their matching funds. It's not going to do much to get them working together in a synergistic way. It's going to just perpetuate the old, "I'm going to try to get money for my own organization." True, it's for the kids, but it's for your own organization. It's just going to keep that splintering.

I think, because we had the opportunity to work differently, in achieving the same results, we can all evaluate what's happening. I think it promoted greater synergy, greater collaboration. I hope that explains that.

The Vice-Chair: We're really out of time, but I'll allow you a 30-second quick question.

Mr O'Toole: Ms Lubell, I'm really focusing on the removing of barriers between organizations like health, education, recreation and children's services, and most of your presentation looks like a window there.

How do you deal with the organizational legitimacy of the credentialling -- only certain people can do certain things, compartmentalized thinking? The curriculum in math is a good example. If you developed it and you're not an educator, well -- I think I've made my point.

The Vice-Chair: We'll move on to the official opposition.

Mr Hoy: Good morning. Thank you for your presentation. You did spend a fair bit of time -- you mentioned in a number of different spots in your brief the need for funding and the attention to staff and administration. Are you fearful that these programs will fail if the government does not provide money for staff?

Ms Lubell: Past experience shows that a lot of these innovations are great ideas, and people seize on them and they're able to keep them going for a very short time. But because they tend to be only focused on the program innovation parts, and the dollars are given for that, over time an organization isn't able to sustain that because it's too big a drain on its other resources. You can do anything for a short time, but I think if we're going to look at long-term sustainability, we really need to pay some attention to administrative costs. By and large, programs haven't tended to do that.

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Mr Hoy: You mentioned a three-year funding model, for example. Do you have a recommendation as to who would provide the government with that three-year funding request? Someone is going to have to look at what the needs are and what the community needs here at the local level. Do you have a suggestion how it would be done or who would provide the government with those figures?

Ms Lubell: If a call for proposals came or something, I'd like to see any proposal have to come from more than one place. It'd like to see it have to come from more than one sector. If you put something in for a three-year proposal, let's say, or a multi-year stream, I could see requiring, certainly, some kind of evaluation of outputs -- not outcomes but outputs -- at strategic levels. I could certainly see that kind of reporting thing. I could see groups getting together and being able to apply. But it's the length of time, because you honestly need a bit longer than people think is necessary to get something sustainable going.

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

I would like to remind the members and the staff that we have to check out of the room by 12. For lunch we have reservations in Tuscany's Bistro. It sounds pretty exotic.

LONDON AND DISTRICT
LABOUR COUNCIL

The Chair: Our next presentation is from the London and District Labour Council. I would ask the presenter to come forward and state your name for the record. On behalf of the committee, welcome.

Mr Gil Warren: Thank you. It's Gil Warren, London and District Labour Council. We represent most of the unionized workers in London, Ontario. I'm the president of the labour council. I want to thank you today for giving us an opportunity to speak to the committee about the upcoming provincial budget. We have a lot of ideas. I think many of them are different from those of the government; I recognize that. Some of them are even a little different from those of the NDP. However, I'd like to have a discussion. I get half an hour, is that correct? Maybe I could keep it down to 10 or 15 minutes on the presentation side, and we can do some questions. I notice that you gave me the time just before lunch, when everybody's kind of grumpy and wanting to eat, so I'll not be too hard on you.

The Chair: Although they're pretty well behaved. They're all on diets this morning.

Mr Warren: All right.

I thought of doing my usual 20-page speech and writing it all out and giving it to you, but I've sort of noticed that the longer I write, the less people pay attention, so I've got it really short today. I'll get to the page I handed out earlier, but I just want to make some comments ahead of time.

First of all, while we're pleased to be able to speak to this committee about the upcoming budget, our labour council was quite displeased that we weren't able to have public hearings on the Employment Standards Act in the fall. We repeatedly asked for that and didn't get it. I know perhaps it's not the responsibility of this committee, but it is of the government, that there should have been employment standards hearings. There were a lot of people in London who wanted to speak, and people from this area of southwestern Ontario: St Thomas, Woodstock, Chatham and that sort of thing. So perhaps you could carry that message back.

The theme of this is apparently what to do with the surplus that we have with the provincial government. We wanted to make some comments about that. First of all, our key concern is that, yes, we agree there is a surplus in the provincial budget for this year. We still have a very large debt, but the deficit on a year-to-year basis has been eliminated. Our point is, how did we get to a surplus? What we feel is that, one, the government was lucky that we've had a very prosperous economy in the last two or three years, especially in the United States, and that's basically why there is a surplus to some extent. The other factor is that this government made massive cuts to provincial programs in health and in education and social spending, in the Ministry of the Environment, in social housing. So we feel that on the one hand the surplus is due to good luck in terms of the economy, and on the other hand that you did cut billions and billions of dollars from provincial spending.

Our position is that if there is a surplus, that money should be put back into social spending. For instance, we see in Toronto now 100,000 homeless people. It's just outrageous that we're not spending money, both provincially and federally, to house those people. The problem is that we're all so overwhelmed by the details of life that we lose track of the big picture, and the big picture is that there have been massive social spending cuts both provincially and federally, and our labour council's position is that we want that spending money put back. We're not asking for greater spending than what we had, say, in 1990; we're just asking that it be restored. That's the central message we want to get out.

When the provincial government claims credit for the surplus and good economic times, I think we have to ask the question, "What about the federal government? Surely they must get some credit too." It's a 50-50 deal in the scheme of things here, so we wanted to get that concept in as well.

The other point about spending, when we say that we want to go back to the spending levels we had in the 1990s, we're not even accounting for inflation, which has been running at 2% or 3% per year, or the fact that our population is growing numerically with immigration, and also that it's an aging population. So to restore funding to previous levels, you have to take into account the fact that you've had inflation of 2% or 3% per year.

These aren't just my opinions. We had some discussions at our labour council before I came to make this presentation about what people wanted to say. The labour councillor from the bus drivers' union wanted to have some comments put in and the retired GM worker wanted some comments, so I've included those in our comments today.

Another point we want to make about the surplus is that we think it could have been even bigger if the provincial government hadn't done the tax cuts that we've seen over the last two or three years. Those tax cuts actually came when we were not in a surplus position with the budget but when we were actually still in a deficit position. Basically those tax cut dollars were borrowed and added to the provincial debt, and we think that's kind of strange, because this government has made so much about the issue of the debt and how it increased with previous governments. But at the same time they're willing, for political purposes, to gain popular support, to do a tax cut that's funded with borrowed money. It doesn't make too much sense.

The other thing is that when previous NDP and Liberal governments were spending a lot of money on social programs -- and, by the way, those did not increase dramatically; that spending was basically either level or actually decreased, for instance, under the Rae government -- we had a situation where governments were spending money on social programs but your government came in and then started to cut on those programs. Our feeling is that, yes, the dollar deficit has gone down, but the social deficit of this government has gone up. We see it as a deficit when you have homeless people or you have people on welfare who are getting a lot less money than they used to, and we see it when there's a health problem or an environmental problem. We feel there is a need to look at the social deficit side of things.

What about the debt? That's curious, because when you told us you had to cut back on social programs, you told us it was because there was this terrible debt of billions and billions of dollars and that we had to get rid of the debt. But when you get to a surplus position in terms of your revenue, suddenly the issue becomes tax cuts. We wondered, did you really believe in the deficit thing or the debt issue, or was it all just posturing to get rid of social programs and to decrease taxes on the wealthy? That's a very serious issue we should look at.

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The other concern we have is -- in the last few months it's become really clear -- that the Ontario economy is headed into a recession, and the Canadian economy. It started in the United States. It's been a very rapid recession that has amounted to thousands and thousands of layoffs, both in the States and here in Canada, in the auto industry and the high-tech industry.

We say that if you have some surplus dollars floating around, you'd better save them because you're soon going to be in a situation similar to what Bob Rae had when he took power. He rolled into power and then suddenly there was a very great recession, with a decline in tax revenue and increased spending costs. Our feeling is that when the recession comes, there will need to be dollars for increased public works programs and job creation. There's a great need there.

One of the things you did as a government was very cleverly to split some of the responsibilities between the province and the municipalities, and you downloaded things like social housing and public transit. Our concern there is that now that there's a recession coming, there's going to be a great need for increased welfare payments because people are being laid off and they're losing their jobs. So who's going to pay for that? Now it's going to be the municipalities trying to cover increased welfare costs. In southwestern Ontario in the early 1990s, we had massive layoffs and massive unemployment and the welfare rolls rose dramatically.

This government boasts that they've reduced the welfare rolls. Part of that is because the economy was prosperous, and now we have a situation where it's going to go into recession again. Are the resources there to cover the welfare costs? It's not a case that on January 1, 2001, the working class suddenly becomes lazy and all apply for welfare. The problem is that they lose their jobs. Unemployment insurance federally doesn't cover. Now only 33% of the people who become unemployed are eligible for UI. So that cost is passed on to the province and on to the municipalities.

People go on social assistance because they don't have a job. When there's work, they go back to work. That's the simple reality of it. We just don't know how the cities are going to be able to cope, especially with social housing. They can't cope now with the social housing need. How are they going to cope with it when there are two or three times more people who are homeless due to unemployment?

We want to talk for a minute about the issue of tax cuts, and that's what I handed out here, this one-page paper. On one side it says, "$1 Billion Worth of Jobs." On the other side it says, "MOEE Staff." We won't talk about the Ministry of Environment staff just at the moment; we want to talk about the $1 billion worth of jobs. Perhaps you could just write on the top there that this is part of the presentation from the London labour council.

Sometimes in life something just comes along that sums up everything, and I think this chart does. I want to take a minute to go through it because it really does show a tremendous difference in approach. This is from an alternative federal budget that was produced a few years back, and I've had it in my files and I always like to get it out and have people take a look at it. I acknowledge that this study was done, as you can see, by Informetrica, which is a legitimate company that does research on the economy with economists.

They're looking at, and you can see it at the top: if you had $1 billion to spend, what would you do with it? It says, "$1 Billion Worth of Jobs." It says, "Job creation impact of $1 billion worth of various federal government actions." So this study was done for the federal alternative budget, but I'll bet you that this committee has the resources to find another economic company that would do the same thing for the province. What it says, and this is really significant, is that if the federal government directly hires new workers, for instance, whether they be federal government employees or whether they be nurses or whether they be transit workers or whatever -- you can see the number over there -- 56,000 jobs are created. That's really significant. As you run down the column you see, "Spending on goods and services." So this is government purchasing for supplies and things; if you had $1 billion, you would create 28,000 jobs. "Infrastructure spending": this is building a bridge, for instance, or a railway, high-speed, inter-city public transit or whatever; $1 billion spent on that creates 26,000 jobs.

GST cuts -- there's a tax cut -- would create 17,000 jobs, but what this says is that different types of tax cuts will create greater or lesser numbers of jobs for the same amount of money: $1 billion. Corporate tax cuts would create 14,000 jobs. Personal income tax cuts would only create 12,000. Payroll tax cuts would only create 9,000. Now that we're at the bottom of the column there, 9,000 jobs created from payroll tax cuts, notice how direct hiring created 56,000. Your government says when they do tax cuts -- and you're not the only one; I've seen the federal Liberal Minister of Finance do exactly the same thing -- "Oh, the economy's going into recession. Our tax cuts are arriving at just the right time because we can create jobs by reducing personal taxes or payroll taxes." That's true, but it's not really the story. The story is that while you create some jobs with a tax cut, you can create thousands more by direct hiring: by hiring a nurse, by hiring a teacher, by hiring a city worker. That's our point.

I wonder why it is this little chart, that I had to dig out of the federal alternative budget, is not in the media. The media don't pay attention to this issue. They just blandly accept the idea that personal tax cuts create jobs. But I'm saying, as a labour person, as a taxpayer, I like good value for my money. Right? I'm not a spendthrift personally. Neither is our organization. We have employees and we have to meet payroll. What I'm saying is, if the government has $1 billion, let's put it to good use. Let's not do personal tax cuts; let's do something like direct hiring.

Just to explain why this happens, if you give someone a personal tax cut and they're a millionaire, they can go and buy a car, for instance, a German sports car made in Germany. No automotive jobs are created. You guys have given this person the tax cut, and that's what they do with the money. Even if they invest it, they could invest it in a hotel in Thailand. It doesn't do anything for our economy. But if you do a direct hire, if you hire a nurse who is working-class person, the odds are they're going to spend most of their money in the local economy. That's why it creates more jobs. Also, if you spend the money and build a bridge, the bridge isn't going anywhere once you've built it. The bridge stays right there. You might be able to sell the bridge, but the bridge isn't leaving the community. However, if you do personal tax cuts, that money can go anywhere. It's not like the bridge; it doesn't stay in the community. That's our point.

We're saying we would like to see social spending restored. We disagree with the whole approach of the last 20 years of Margaret Thatcher, Ronald Reagan, Premier Harris and the right-wing agenda, which said, "The way to create jobs is to go for personal income tax cuts." We do not agree with that.

A couple more minutes, a couple more points. Another point we notice here in London is that when we get into a recession, the layoffs happen right up front. They're happening right now every day in the paper, thousands and thousands of layoffs. The economy's actually at its very peak right now. There's panic in the media and we get big layoffs. Those layoffs tend to be way over what is needed; in fact, the company ends up without enough people in a few months. But what happens in terms of our local economy is that it might take five years for the employment level to get back to where it was just before Christmas. We're seeing an incredibly long time before the employment levels get back up, and it's at the peak of the next business cycle. We have short-term levels of unemployment, maybe at 6%, and then it quickly goes back to 12%. We never did reach the level of the States, which was looking at 2% or 3% unemployment. There are some real problems here in our economy, and there are still millions and millions of unemployed people, underemployed people and people who are going to school because they can't find a job. We think the emphasis should be on social spending and job creation.

I've just about used up my 15 minutes. I had another page of stuff, which I won't get into, but if you want to ask some questions or have a little debate here, I'd be happy to respond.

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

Mrs Molinari: Thank you very much for your presentation. I'm hearing you say that you disagree with a number of initiatives this government has taken and some of the initiatives of the NDP. It's difficult, when one is in government, to make decisions that are going to please everybody. Sometimes no party is going to please some people. So I'm interested to hear you say that.

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I want to put on the record some clarification on some of the comments you've made. There's a number I could address, but with the shortness of time I will focus on your comments with respect to health and the fact that you indicated in your presentation that health care spending has gone down. I want to clarify that.

In 1995, the Ontario government made a commitment to protect health care operating spending at $17.4 billion, and that commitment was exceeded. In fact, health care spending in 1995-96 was $17.6 billion, and it's been increasing every year ever since. As of the third-quarter finances for 2000-01, the base operating spending is $22.5 billion. That's an increase of $4.9 billion since 1994-95. While the government promised last year to invest $22.7 billion in health care by 2003-04, that target will be achieved by next year, two full years ahead of schedule. This year, the base operating spending on health care is increasing by $2.1 billion over 1999-2000 actual expenditures, and the increase is primarily due to a number of new measures and initiatives that this government has taken forward.

You've also talked about the federal government and their responsibility with respect to health care. As our Premier stated, the federal government should pay 18% of the nation's total health and social program bill. This is a level that was supported before it started making the major reductions in funding in 1994-95. Also, what they included didn't account for the escalator, which would keep federal funding increases coming as fast as the cost of health care spending should be. The Canada health and social transfer cash entitlements are still not allocated among provinces on an equal per capita basis. I encourage you to also make presentations to our federal government, encouraging them to give Ontario its fair share of the Canada health and social transfer payments.

You mentioned in your presentation the $1 billion that we should be investing. I think most of the presentations that have come forward in the last number of days are claiming that $1 billion. It's been spent over and over again, if we were to take all of the recommendations that come forward with that money.

You also indicated in your presentation that tax cuts don't create a good economy and that you don't agree with that. Regardless of whether you agree or not, the facts show for themselves. Many economists have also indicated and agreed that tax cuts have created jobs, and the economy in Ontario is a direct result of the fiscal responsibility that this government has exercised.

The Chair: You have one minute left.

Mrs Molinari: In the one minute then, I would like to ask a question and get a response. It's to do with your disagreements with major governments. I want to know your opinion on the NDP's social contract.

Mr Warren: I opposed the social contract. You're only going to give me a minute, so it's a long answer.

Mr Christopherson: You can do better than that, Tina.

Mr Warren: But let me point out that I did not say that a tax cut did not create jobs. I took five minutes going through there. Your line you gave me was the line the government gives back. I very clearly pointed out that direct hiring creates more jobs. I didn't say that tax cuts didn't create jobs.

Mrs Molinari: You said you didn't agree with that.

Mr Warren: I don't agree with your direction. But be clear about what I said. I said direct spending creates more jobs. That's the whole point.

The Chair: With that, I have to go to the official opposition, Mr Hoy.

Mr Hoy: Thank you very much for being here this morning. You did indeed touch on a great many issues: housing, social housing specifically, municipalities and downloading and the pressures they're under. I took note of that as well.

You spent time talking about health care. Saturday of this week, I met with some workers whose plant is earmarked to move to the southern states, and it was made fairly clear that one of the advantages those workers talked about was our health care system here as in comparison to the United States. They want that preserved -- I suspect you do as well, from your comments -- and that our education must be funded properly. We've had presentations made here this morning in that regard to children and/or students by three other groups out of six. You touched on education as well and the fact that we have an excellent workforce here. We have a lot of good things happening in Ontario, but we need to continue to fund those in a proper way.

I believe it's much easier to govern when times are good. The real test now for the current government will be when we're in this downturn, to say the least. Some predict a recession. It will be interesting to see if the government blames this on the United States, because they never thanked the United States for those years of good times just prior to this.

You have an opposition to tax cuts. Is that something you've held in the past, or is this something you see now as the wrong way to go with a softening of the economy? Have you always been philosophically opposed to it, or do you say that now that the economy is softening and we need to shore up health care, education and other social aspects?

Mr Warren: To answer that question, I am saying that right now with the economy going down, tax cuts are definitely not the way to go. That's very clear. In terms of my long-term view, if the government has no deficit and a balanced budget and it's covered all its social obligations in terms of social spending and there's money left over, fine, do a tax cut. But it's a balancing thing and it's a matter of choices. It's not a situation where we don't have a choice. There are many choices here. It depends on what your objectives are. I say tax cuts are a tool, but I think it's just totally overblown now, the emphasis on tax cuts. People have a vested interest in paying less in taxes in the short term, but they lose out in the long term because they don't get the social programs that are needed by everyone.

Just a comment on the health issue as well. We're not denying that the provincial government is spending more money on health care. The point we're making is, it's not keeping up with inflation. It's not keeping up with an aging population. It's not keeping up with an increased population. A lot of the money that's being spent by the provincial government, which is an increase in spending dollar-wise, is pouring into the multinational drug corporations to pay for patent drugs and a lot of the money is pouring into high-tech equipment. Our argument is that health care spending should be for preventive care, home care and things like that and, again, you might get much better value for your dollar. But the government just says, "We're spending more money on health care, so there's no problem." We're saying look at where the money's being spent, look at the problems of population increase.

The Chair: Mr Christopherson.

Mr Christopherson: Welcome, Gil. Thank you for your presentation. It's good to see you again. In light of Ms Molinari's approach, I wanted to ask you about an initiative by Premier Robarts in the 1960s and how you feel about it. You mentioned a lot of things, covered a lot of ground. I'm just so disappointed, Tina. You can do so much better. But I think it's a compliment to you. It shows she was really stuck. To be able to put you on the spot she had to reach back into the early 1990s.

I'm sure you're aware of Jim Stanford, an economist with CAW.

Mr Warren: I've read his material, yes.

Mr Christopherson: Did you read his material to the committee?

Mr Warren: No.

Mr Christopherson: Oh, I see. He came in before the committee and did a presentation, an excellent one I would highly recommend. You might want to pull it off the Hansard to read it. I think you'd find it very interesting.

The premise of his argument was that not only did cuts in personal income taxes not create jobs and contribute to the boom we had, he was arguing there really wasn't a tax cut. He talked about effective tax rates, meaning the amount of money in total that was available as disposable income by the population. His calculation -- and I haven't heard anybody refute it yet, none of the Tory members at the time, none of the economists who came forward -- no one has refuted his presentation. So, to this moment, it stands. His figures were that only $689 million in 1999 -- which to you and me is a lot of money but in the context of the Ontario economy is pretty small -- he said that's all that's available.

He was tying that to his anecdotal experience -- and it's the same with me and a number of others -- that the average middle-class working person didn't even feel the income tax cut, that the money was so minuscule that it didn't affect their quality of life one way or the other. It wasn't until you get into the big dollars --

Mr Warren: I agree.

Mr Christopherson: -- you know, you start getting into 200 grand and up, where you really start to see some serious money on an individual basis. But overall it didn't have any impact. I'll leave that with you and maybe you can comment on what you get back from your members across the London area in terms of the tax cut. Nobody argues the fact that it's human nature to not want to pay taxes. I think that's pretty obvious. But the fact remains, are you going to get the benefit you think you're getting just because they throw 75 bucks a month at you? That's pretty much the question.

I thought you did an excellent presentation, by the way. You covered a lot of ground. Obviously you know your stuff. You mentioned welfare. It's important to recognize that the other thing is that there will not only be more people going on social assistance -- which was in part the contributing factor for our increased costs, because the free trade agreement kicked in, and hundreds of thousands of decent-paying jobs, especially in the industrial sector, were lost to our economy as a result. But this government has also changed and squeezed out an awful lot of people who otherwise would qualify for social assistance. I raised this earlier, and I raise it with you. You pointed out how few people already qualify for EI. What do you think is going to happen to those people and their families in the London area who don't qualify for EI, go to social assistance and don't qualify there? My question is, then what? Where exactly do they go?

I don't have a lot of time. Why don't I leave that with you and get you to sum up.

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Mr Warren: The answer to "Where do they go?" is that the family ends up living under a bridge and then they get cold or sick and die. That's where we're headed, and those are Third World conditions. It's outrageous that our most advanced civilization is disinheriting thousands and thousands of people. We've seen that here in London. We've seen an increase in people who are absolutely, totally helpless and have no resources. They have no friends, they have no family in town and they're faced with living under a bridge. One wonders sometimes if the government wouldn't like all of those people to just go away forever.

On the issue of welfare, I agree the welfare costs have gone down because people got jobs. They've also gone down because all kinds of people have been disqualified for all kinds of picayune, silly reasons. There has been a campaign to remove the dignity of people on welfare. We think that's outrageous and it should be restored.

In terms of how people are doing with the tax cuts, I agree that for most of my workers in the labour movement, and these include people who make good wages like $20 an hour, the tax cuts were nothing to them. It didn't matter, $100 or $75. In fact, when you factor in the increased municipal sewer taxes, user fees and all the other additional taxes, I would argue there really hasn't been a tax cut, that any taxes that were reduced for average people have been taken back with user fees, recreation fees, school fees and on and on. However, there has been a tax cut for the very wealthy.

In the last couple of years, I will acknowledge the economy was doing not bad in terms of gross provincial product, in terms of the wages of the top 30%, stock value and things like that, and people made a lot of money, if they were in the top 30%. For the average worker who works at Ford or GM here in London, their income stayed about the same when you factor in inflation. For minimum-wage workers, there hasn't been a minimum-wage increase in this province since this government took power. With inflation at 2% or 3% per year, they're out by at least 10% or 12% compared to when the NDP were in power. For the people on welfare, their income went down with the welfare cut. What was that percentage?

Mr Christopherson: It was 21.6%.

Mr Warren: Some 21 points. Then we've had inflation for five years, with inflation at 2% or 3%. I'd say welfare people are 30% or 35%, a third, worse off than they were when the government came into power. It's the same for people on minimum wage. This economic boom went to the top 30%; it didn't go to the rest of us. That's the problem. If you're going to have an economic boom, it should be spread around. That's why governments have this role of redistributing wealth during the good times.

The other problem we look at is demand. Companies say the way to get more business is to cut costs, cut wages, cut raw material use or whatever. But the problem is, who's going to buy the product? We see it as totally the other way around. The problem is demand. If there aren't enough people working, making a decent wage, there's not enough demand, so your economy ends up overproducing, which is exactly what has happened now. We have surplus production and not enough people to buy stuff. That's the big contradiction. We can produce, but if we don't have people working, they can't buy and the economy goes down. That's why we're going into a recession right now.

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

We'll recess until 1 o'clock this afternoon.

The committee recessed from 1155 to 1257.

ADVANCE LONDON

The Chair: Good afternoon, everyone. I'd like to bring the meeting back to order. Our first presentation this afternoon is from Advance London, and I would ask the presenters to come forward and state your names for the record. On behalf of the committee, welcome.

Mr Dale Henderson: My name is Dale Henderson, president of Advance London. I'm with Jeff Shervington, the chair of our finance committee for Advance London and a small business owner, who certainly has an interest in small business as well as a speciality in finance law for corporations.

In front of you is a small package I've handed out. The first page has the three proposals that we want to put forth from Advance London and the back page is a little summary of our accomplishments in Advance London, where we set it up four years ago and united with about 450 business people in London to try to change the culture and the logistics of what happened in London. Many of our successes are shown there -- the 30-odd -- which included the formation of the London Economic Development Corp being spun off as a private-public partnership, and a lot of other things that are directly because of that initiative.

I guess I'll give just a one-minute background of myself, to give you an idea of just where we're coming from, from a business background. I'm a professional engineer who graduated 30 years ago and have been operating my own companies, eight companies to date -- still in business -- over those years. They include a high-tech company where we custom-design and build electronic equipment -- we still do that -- for GM, 3M, Northern Telecom and large companies; we have a farm operation going, Arondale Farms; we have a first private band radio station in London, Spirit Radio, that's on the air now as of last April.

I got a personal gaming licence years back, one of 24 they gave in the province and we, in 10 weeks, opened up a racetrack and created 85 jobs directly, and $230,000 in tax and did $5.6 million in sales in the first 85 days -- I say "days" -- of operation and sold to the agriculture society in Leamington; we also have a chain of medical clinics and we're setting up the Mayo Clinic of North America; as well as a school that I own.

So other than being the founding director of the London High Technology Association, and president for nine years and one of the founding directors of the small business centre in London, I've got a good idea of what it takes to create jobs. I've been doing it for many years with low finance.

The presentation: three proposals to create a minimum of 50,000 new Ontario jobs with no new provincial government expenditures. The spirit of what I want to say here is, how do we, without any new spending by the government, legislate to try to have an environment where new people can create jobs and entrepreneurs can raise the financing in order to do that?

The first problem is limited, inexpensive or no access to risk capital for new company start-ups or expansions, so the idea of how do you get money from someone other than your mother and dad or mortgage your house in order to get a bank to finance you? This is what is happening in the States and it's luring many companies away from Ontario in order to get low-cost IPO financing for their companies. Adopting the SCOR program -- that's the small corporate offering registration -- means less stringent filing requirements, seriously reducing costs of completing an IPO and instituting a uniform offering prospectus that would standardize access to capital in Canada. It would also be in full support of the NAFTA, as 46 of the American states right now are using SCOR programs, each implementing the above criteria for their own programs, state by state, and in conjunction with the federal government/SEC.

Briefly, what that says is there is a system in the States right now that will allow a company to put down $10; they can take a 50-page registration form, fill it out and, if approved by the adjudicator, can then go public and raise funds from the public. They can also take a course -- I think it's a three-day course -- and sell from the treasury their shares to the public, all legal today. Because of the NAFTA agreement, I believe it's also, by inference, legal in Canada.

In order to encourage this, and since none of the provinces have picked this up yet, I think if Ontario is first in making this happen from the point of view of making sure that the agreements are transferable from the US to Canada due to NAFTA agreements, we can generate a whole bunch of opportunities for small, low-cost IPAs, to be controlled by the registrar and compete in the small business start-up funds. We can answer questions on that in a moment, I guess, if there are any special details.

The second problem we've suggested here is that right now the unlimited personal liability provisions for directors of corporations is hindering financial and management talent from joining boards and helping to create new jobs. There have been changes over the years to how a person can join. Whether it be in the non-profit, any corporation, there is a liability extended to that, so a lot of people are turning down work on boards. They have to put all their assets in their spouse's name or are lured away at trying to move assets offshore in order to protect themselves in case there is some type of a bad occurrence in the company.

What I've proposed for a solution here is to limit the personal liability of directors of corporations due to business losses, to specify and limit personal damage limits and direct conditions where general insurance policies can be competitively quoted to companies. The idea here is, let's have a situation where I, owning eight companies and having a health care company and not wanting to go broke, am wondering how I get liability insurance on all these different concerns where I'm creating jobs. How can I have an insurance policy? How can I limit my liabilities without having to go to Switzerland and live there for six months plus a day in order to protect what's going on here? I think this is a major issue that can be addressed with legislation and with no money being spent other than setting up conditions where people can do their thing.

The third problem that I think could create a whole bunch of jobs without any additional expenditures by the provincial government is that our research and development tax credit and rebates are only aiding a few large corporations and are creating very few net high-tech jobs in small businesses. We can debate this probably for a couple of days, but I, as a high-tech company for 20 years and president of the high-tech association for nine, have seen what's been happening with the rebates. Basically Ontario, I think, is twinning with the federal system and there's a whole way by which monies are being allotted back. The illusion is that jobs are being created.

In my opinion what's happening -- for example, in the first five years of this decade, half the money of all R&D tax credits went to Northern Telecom. It's not well known, but the large companies are getting the majority of the money. Even a lot of the federal grants are going to one company: GM Diesel. So if you take a look at what jobs are being created, certainly all the audits are coming into the small business area. For years we claimed back a whole bunch of their tax grants because of issues like, who made the circuit board and is this in fact new funding? It became basically punitive. I know about half the high-tech companies in London don't even subscribe to the R&D tax credit system today. So on that basis Ontario is subsidizing that program, and here is where I am proposing what we could do with the monies that we would otherwise be giving back in tandem with the federal government.

We would scrap the Ontario twinning rebate R&D provision with the federal government and form Ontario's new R&D job creation program, with the existing expenditures invested in the following way: we'd take a third of the money from this Ontario fund and finance scientific research at universities where the invention or the process patent is 51% owned by the public institution. That would be controversial to some extent, because a lot of the inventions right now that are paid for by the government, paid for by the university, are owned, believe it or not, by the professor. The problem is, if he doesn't choose to set up his own company or choose to give away the rights to it, this project and all the financing may not get to create a job. So on this basis I would say that the way the money should go back is that the university should have at least 51% control of that patent and be able to spin it out and create some jobs.

Second, one third of the Ontario fund could finance a central technology transfer and commercialization group working with the universities to commercialize their research and inventions. This is a central group that would have marketing people and finance people connected and would be pulling out all the available projects coming out of the university environment, as well as inventing through the university. It would be a better way, I think, to coordinate and have hits and in fact create jobs based on that type of dialogue. So that's the second idea for the expenditure of that money.

The third thing is that one third of the fund would finance expenditures in advanced technology, seed funding to create and fully fund strategic cluster skills and products. This process will create jobs quickly and create a royalty stream to financially sustain and grow this activity. That fund is a little bit unique but yet I think is very strategic in this fast-moving business that we're in where every two years your computer is obsolete. We have to move very quickly. In this case, we could have a pool of money where a technology-connected board could make decisions on how this money would be spent. It wouldn't be matching funds, it wouldn't be 50-cent-dollar funds; it would be fully financed.

For example, eight years ago Canada had the lead on cellular technology. They were making cellular phones, they were top in the world. If they had at that point decided that they wanted to let out, let's say, three $1-million contracts to design a small, hand-held cellular phone, have it designed by the three companies that were awarded the contracts, then in turn license it back into industry so they could manufacture, you would have a tremendous amount of manufacturing here in Canada. You'd have a whole pool of talent with cluster skills knowing all about what happens in cellular technology and in fact allow it to spin off for the biggest bang for the buck.

A thought here is also that if there is a royalty stream, that would self-sustain that fund and you don't have to have more and more tax dollars; it would in fact sustain itself because it has opportunities in a growing business.

Those are several things I would propose that you could consider in your finance committee and what the directors and the government could do. Again, we're not asking for money. We're just asking for legislation to in one case tandemly approve what is going on in NAFTA, and the others, adopt an environment where we as entrepreneurs want to work in Canada, want to stay in Canada and want to make money and keep it in Canada. This provision I think would be tremendously advantageous to growing jobs in Canada.

We're open for questions.

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

Mr Kwinter: Thank you very much for your presentation. I have a couple of questions. The small corp offering registration: the concern I have is that you say it means less stringent filing requirements. The filing requirements are a consumer protection device. One of the big problems we have is that even with those filing requirements we have problems. We have problems with companies like Bre-X and others where suddenly the consumer, in this case the purchaser of their stocks, winds up with nothing. My only concern, and maybe you could tell me, is how these SCOR programs in the United States work to protect the small investor, who needs the most protection.

Mr Henderson: My understanding, and Jeff can answer after I answer what I know about it, is that there is no lowering of standards for doing the corporation IPO. You still have to have the high standards in there. The difference is, you're not paying $250,000, or whatever it is, to fund a company to back or to sell these shares. You're responsible for doing your own deals as far as selling them to the market.

The legal issues, as far as the corporation officers, if there is anything done that is untoward, they go to jail. There are serious criminal actions taken upon the directors. They do not allow any scams to happen. It's the same qualifications as a senior IPO but it's just a low cost. You can register at hundreds of dollars as opposed to hundreds of thousands of dollars.

Jeff, do you want to mention --

Mr Jeff Shervington: Yes. One of the inhibitors, if you will, so you don't get suffering too many Bre-Xes out there, is that there are four levels of funding through the SCOR program currently. In any 12 months these three programs apply. There is a state or a federal program which limits to $1 million. The regulation A is $5 million. You've got your SB, small business, level one offering which is under $10 million, and your small business level two which over $10 million. Generally, your large institutional investors do not participate in a SCOR program because they cannot substantially buy a chunk large enough for their interests. So it is the small investor, but there is not that potential for it to snowball into a major catastrophe that will affect the markets.

There is that element, but it is still a fill-in-the-blank question. It's a uniform offering prospectus. As Dale had mentioned, the first $250,000 -- I've got friends on Bay Street who say, "Pay me $250,000; I can take you public." That doesn't accomplish anything for the company. That covers for the accountants, the lawyers and the printers to get you to that point. This is a self-serving mechanism and a vehicle whereby it's driven by the issuer to advance the goals of the issuer without worrying, "Do I have $250,000 to pass go?"

Mr Kwinter: I also want to address problem 2. The whole theory behind a limited liability company is that the exposure is only to what the capitalization of that company is. I don't see quite what the problem is with members joining the board, other than that there is no question that if you're a member of a board of a public company and there are some problems -- we have a situation right now where the former Premier of Ontario is being charged by the securities commission and, notwithstanding that it's a limited liability company, he is still potentially liable. But there is insurance for that. There is directors' insurance for that and that's available. All the company has to do is make sure that happens. It's for the liability of the directors where the company does something that is illegal or contravenes any legislation. That is available, and I'm not quite sure what you're trying to do with your number 2 issue.

Mr Henderson: For example, if you're a corporation director and if it winds down or something like that -- if people aren't paid, if payroll wasn't paid -- that's a personal liability of a director. So anyone joining a large company, whether it be a non-profit group and they happen to go broke, the directors are on the tab for any payroll deduction or taxes owing. It's part of the requirements of the director, which is something to worry about, something to have insurance for, if in fact you can get insurance for that.

The issue has to do with limits. For example, if I have a health care company and someone is being treated for cancer and whatever happens -- the person doesn't live or whatever happens there -- I'm saying there has to be a limit to which one can take insurance, whether we say it's $10 million or $100 million, whatever the number would be such that you can take insurance for that so it doesn't go to a billion dollars or the director doesn't get completely wiped out. If he's acting untoward or if there's any kind of culpable or criminal activity, that's a different story. But if a person is just acting in due diligence as a director of a corporation, then I'm saying put a limit on the liability. Set up the conditions by which this is the general government's rules on liability so that other insurance companies can all bid for the same thing. You get a competitive environment, so we're not going out and saying, "What would you like?" or "This is a special case for what you want," and then you're paying hundreds of thousands of dollars in some cases, which would be punitive enough for anyone wanting to be on the board.

The Chair: Mr Christopherson.

Mr Christopherson: Thank you for your presentation. I had questions around the same issue, around the limiting, so I won't go back over that ground. I really have just one comment and a very brief question.

My comment is, I think it's an excellent approach to offer up at least one segment of recommendations that don't entail new spending but that will help advance a local economy here in London. I appreciate your efforts.

I just thought of another question too. Are there similar organizations in other communities that you're aware of?

Mr Henderson: This is a volunteer group. There are other groups, mainly in the States, I think, getting together to try to make things happen, a little different from the chamber of commerce.

Mr Christopherson: I was going to ask. Yes.

Mr Henderson: We've been working with the chamber of commerce and with the University of Western Ontario in order to encourage the private-public partnership which ended up to be the London Economic Development Corp, spun off a year and a half or two years ago now. It's been a volunteer group. It's just, in my vision, people going and doing it, opposed to having a committee to decide on what somebody else is going to do. So that was the thrust.

Mr Christopherson: Is that how you differentiate your purpose from the chamber's?

Mr Henderson: It's also -- I guess that would be the best way -- more trying to set up an environment by which people can do their thing. For example, we decided that London was a good spot to make movies. The powers that be and the other groups were saying, "We're not too interested in the movie industry," although we could detect that there was an interest group on London, and now the biggest industry in Toronto is movie-making and it's only two hours away. So we formed a group called our "manufacturing entertainment committee" and they started to have meetings. We had close to 30 people at different monthly meetings for that. They ended up helping to set up a list of who's available in town, get people to know each other, a networking group, and one group has now spun off and is doing a show on Global, as a matter of fact.

It's that type of growth thing as opposed to saying, "Well, we've done this in the past, we've had this committee in the past and what can we do in the future?"

Mr Christopherson: You take a real risk calling it the "manufacturing entertainment committee," I have to tell you.

I have one very brief question, and it's simply because I don't know the answer. You mentioned in 3(c), the last sentence, "This process will create jobs quickly and create a royalty stream to financially sustain and grow this activity." Where would that royalty stream have gone or where does it go now, as opposed to this?

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Mr Henderson: First of all, it's twinning up whatever the federal government is doing, so it shows up in their books. You may have a tax benefit for a company if you buy in, or Northern Telecom would have the money in creating jobs, you know, somewhere else in the world. But this is new product, so you attach it to an invention at a university, for example -- no, in this case, I'm suggesting they would go out and do something and fully fund it.

So let's say they got wind that there was a new technology for separating gold from soil, and they said, "Oh, gee, for $500,000 this could now become a project that could create a whole bunch of jobs and have a strategic benefit to Canada." Then they would fully fund that project, could even have a tender on it, and whatever process or whatever product was developed from that, they then relicense it out to the industry. There would be a royalty tab to that and that would be self-funding for this whole development.

Mr Christopherson: Right, thanks very much.

Mr Galt: Thank you for a super presentation. If it isn't the best, it's one of the best, from my vantage point, and congratulations on getting it all on one sheet of paper. It sort of meets my objective: if you can't put it on one sheet of paper to explain, then you don't understand the problem. You've certainly met that objective.

Mr Henderson: That's the problem with being an engineer. I try to assimilate it so small that people don't understand it.

Mr Galt: It's just marvellous. Problem 3, I think, is self-explanatory. I wanted to make a comment on problem 2 and then I want a query on problem 1.

It's interesting that you point out this personal liability with boards of directors. Certainly volunteers are very concerned about this. I did take a resolution to the Legislature, having concern about that. It's very difficult to put it into legislation and not have perpetrators taking advantage of the situation. It's one that I believe does need to be addressed. I was thinking of it more from the volunteer boards, but you bring forward an interesting point.

I chair the Premier's Task Force on Rural Economic Renewal and one of the three major barriers to job creation and development in rural Ontario, small-town Ontario, has to do with creating capital. This is kind of interesting and Mr Kwinter explored the risk, which I was concerned with.

One of the things we're hearing, particularly in northern Ontario, is about all the dollars that flow out. Probably you could say that about most of rural Ontario. Is there any way with this approach that dollars raised in the Fort Frances area would be invested in the Fort Frances area, to use that as an example?

Mr Henderson: Yes. I believe that the next wave of development that we can attach ourselves to in Canada is a wave of self-sufficiency. Yes, NAFTA and world trade and what have you -- we could, you know, do all the beer in the world in one place but yet we want variety and we like to have the little ma-and-pa operations doing it. So I think if we had some type of fund that would have self-sufficiency -- if you drew a circle around one of the northern towns and said, "OK, where is the cheese made that would be used by this town?" and you point to who makes cheese or who makes the secondary products -- whether it be cheese, the butcher, it could be growing any foodstuffs, it could be entertainment issues. You try to identify that and then try to support that type of self-sufficiency, for two reasons. One is, you have a certain amount of skill set learning that would happen, plus you'd put people to work immediately.

Mr Galt: Could this solution to problem 1 work in what you're describing?

Mr Henderson: Yes. If someone wanted to, let's say, start a cheese-making entity up north, whatever, they would then fill out their $10 application form and they would list that through whatever listing mechanism was set up to do that. There are two issues that could happen here. I, as an investor, then can invest in that company, through the Internet, through the stock market, whatever, and I want to put $100 into his company. The question is, would I want to and what's the advantage?

But here is one of the keys to this, which I think could be unique. Let's say that company said, "I'm going to guarantee you a dividend every year. As a small company, I'm going to give you 5% of my sales, which will be part of the dividend I'll guarantee you every year." Now, who's not interested? A lot of companies now are just running around on speculation and/or they're hoping for the equity. But if you said that part of the uniqueness of this company would be a guaranteed dividend, 5% of the sales, then I'd put 100 bucks into your cheese-making company and I'm going to get maybe $2 or something every year based on the revenues generated by that company. Now you've got a play. You've got an equity play, a dividend play and also a speculative play, which a lot of people seem to want, which could generate a whole bunch of capital. I think the wealth-creation portion of it would be -- 150,000 jobs is nothing; you'd have such a demand.

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

THAMES VALLEY CHILDREN'S CENTRE

The Chair: The next presentation is from the Thames Valley Children's Centre. Could I ask the presenter to come forward and state your name for the record. On behalf of the committee, welcome.

Dr John LaPorta: Thank you for this opportunity to address you. I am John LaPorta. I'm the chief executive officer of the Thames Valley Children's Centre. The centre is located in London, and in fact has been in existence for 50 years. We are part of an association of treatment centres; there are 19 of us across the province. We serve children with physical disabilities, speech and language disorders, developmental disabilities and a whole range of what we call multiple disabilities.

Mr Galt, I failed you criterion of getting everything down on one page, but I could actually summarize what I'm here to talk about in almost one sentence. It's simply this: if we invest a bit more in our children with multiple disabilities today, it will pay off for all of us much more down the road. We'll have many more individuals who are not on financial assistance, who are not receiving ODSP and unable to get off it, who will not be a drain on our social services system, but it means we have to invest in that today.

These 19 treatment centres basically serve somewhere in the neighbourhood of 20,000 to 25,000 children annually. Our centre here in London, which is a regional centre, serves 5,000 children across southwestern Ontario.

The issue for us is that for approximately six years -- and we are predominantly funded by the Ministry of Health, although we also receive funding from the Ministry of Community and Social Services, and some of our centres have special schools so they receive Ministry of Education funding. For a long time, the entire system didn't know what to do with us, so what happened was that we languished in a situation where our budgets were frozen after the cutbacks through the social contract period while everyone was trying to figure out what to do with us. In essence, we didn't wait for the ministries and government to try to figure out what to do with us.

We went to our own clients and asked them, and we talked among ourselves. A year ago, a review was done by the ministry through the office of integrated services for children. What came out of that review was that essentially this system, which is actually unique in the world -- we have a system of children's rehabilitation centres that is nowhere near in existence not just in Canada but throughout North America and the rest of the world. What we found and what that review found is that this system has been found by the clients -- by these families and their children -- to be a naturally occurring system that meets a lot of their rehabilitative needs but could meet even more of their needs as well as be an integrative and coordinating force for them in the system.

We actually have a wonderful system of services in our province today, and we've had some new initiatives, such as the preschool speech and language initiative and the initiative for children with pervasive developmental disorder. I don't know if any of you have a special-needs child, but if you were to try to navigate that system on your own, you would be lost. What these families also need, in addition to a broad range of rehabilitation services, is help in coordinating that system. They themselves identified to an objective review team that our centres provide that kind of natural hub, an integrating and coordinating centre for them.

Basically, as you'll see in the report that's outlined in front of you, we've done an assessment of what it would take to ensure that children throughout the province have equitable access to an effective range of core services. Our estimate is that it would take approximately another $20 million to $25 million of investment in this system to provide a system that would in effect provide the kind of applied skill development that would assist these children in participating in all walks of life.

I'll stop there -- because this is just a quick summary of the four pages you have ahead of me -- and answer any questions you have.

The Chair: Thank you very much. I'll start with Mr Christopherson. We have approximately eight minutes per caucus.

Mr Christopherson: I was just looking at the last page as you were talking. What would be the first steps that you would take?

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Dr LaPorta: It would be a collaborative step. The creation of the office of integrated services for children, or now the integrated services for children division, was a significant step in government to try to pull together a number of facets in terms of legislation, policy and practice that in some ways conflict. To work with that division, with the parents of these children -- and in my 30 years in children's services, I have never seen such a coordinated group of parents before -- with the centres, to really look at what needs to be in place both in terms of legislative changes, policy, as well as some of the funding elements, that would be the first step.

Mr Christopherson: When you say "some of the funding elements," are you looking at new funding or are you looking at perhaps redirecting existing as a result of the new initiatives and new legislation that would be generated?

Dr LaPorta: It would probably be a combination, to be quite honest. I have to admit, I don't know all the elements around the existing pots of money. I think there are some initiatives that are already in existence where some of the monies could be diverted toward this end and still not affect the initiatives and the benefit they bring. Where there's a shifting of funding within, say, the Ministry of Health envelope, that's probably where the majority of the funds would come through.

Mr Christopherson: Do you already have a core of people from across the province who can lend support to this, so it has voice from different aspects of the services as well as geography?

Dr LaPorta: Yes. The board of our association, the Ontario Association of Children's Rehabilitation Services, is primarily volunteers -- families and community members. As a system, we probably have a very wide, expansive support for this throughout all of Ontario. In fact, there are three areas, one of which is the Premier's, that would like to have their own children's treatment centres, and we have an alternative to that. We think, through outreach and satellite systems, we can actually cover all of the needs throughout the province, especially in those areas that presently aren't getting it to the extent they wish they could.

Mr Christopherson: You provide some very stimulating ideas, and hopefully someone, somewhere where they can make a difference, will take a look at this and give it a nudge to the first step, because I think it definitely would be worth looking at. I appreciate your coming today.

Mr O'Toole: Thank you very much, Dr LaPorta, for your presentation. Just to recognize the children's treatment centres, we have one in Durham, Grandview, which I'm sure you're very familiar with. I'm quite familiar with the dilemma you're in. Because of its innovative nature, you were not administered by a single ministry, which made it a difficult, from-the-top-down delivery model. But I do agree with this one window.

I recognize you're funded by three ministries, and arguably a lot of community support, volunteers and others who form your boards etc. I fully agree with investing early and supporting the problem, both for the individual and family, but the integrated children's treatment centre approach and that study that was done were long overdue. It was promised for quite a while, as you know. But I saw some anomalies and some red tape issues, as a layperson. I'm not an expert; you're an expert. They had the speech-and-language money, the delivery model, and then we had the CCACs, community care access centres. Who delivered what where became the problem. You know that.

Dr LaPorta: Yes.

Mr O'Toole: The whole issue of "If you don't have your bachelor of ed, you can't do anything in the school," we have to fix that problem, because there are well-trained people, physio and other people, who should be in our schools actually delivering, instead of the family having to deliver the child to the centre. Do you know what I mean? That is a barrier. If we can help, we need your confidence that we have the courage to change what I call silo-thinking barriers.

But I also see it coming on with the learning opportunities grant. It's the same thing. It's the same client group you're dealing with, that learning opportunities money that goes to the school. We were told yesterday in Ottawa by one of the groups that the money is actually going to subsidize teachers' salaries; it's not getting into program delivery.

I want to respect Tina Molinari, who works in the Ministry of Education in the PA role. I just couldn't resist, seeing the barriers I see in my community. On the other side, I support Grandview; so does Jim Flaherty, the Minister of Finance, by the way -- big supporter.

The Chair: Any comments, Dr LaPorta?

Dr LaPorta: I think one of the issues Mr O'Toole is raising is something that our system of centres has made a lot of movement toward. I'll just use our own centre as an example. Today, approximately 60% of our work is done outside our centre proper. We're in daycares, we're in schools, we're in homes, and that's where you need to bring the work to. We're not talking about what I'll call an institutionalized system, where clients come to a physical facility. We have to get our therapists out where clients are. Working with others, school teachers, daycare providers, parents, there's real value in that.

The Chair: Ms Molinari.

Mrs Molinari: Thank you very much for your presentation. You talked in your opening comment about the importance of investing in children, and that's very important. Certainly as a government we're committed to investment in children. We're also committed to improving services for children and families caring for those with multiple disabilities.

Just to put on the record some of the things we have done in initiatives we've taken, there is the investment of $35 million in more community living supports for individuals with disabilities, including children with disabilities and their families. There is an organization in Thornhill, the riding I represent, the Reena Foundation, which does a lot of wonderful work for developmentally challenged adults. There is the commitment of over $20 million annually to create and expand speech-and-language services for pre-school children across the province, and $7 million for respite enhancement funding for medically fragile and technologically challenged dependent children living at home. In the spring 1999 budget, the government also announced $10 million annually, this year growing to $20 million, to enhance children's mental health services to enable innovation and better access. There are a number.

You asked how many of us -- I have a special-needs child, although being almost 25 years old is not really a child but an adult. So, certainly I recognize some of the challenges that are experienced by families, having experienced them myself.

The work you do in your organization is admirable. It's one of those jobs that really tears at your heart, being unable to do all of the things you want to do, and there never seems to be enough, you always feel you could do more. Our government is committed to assisting in whatever way we can so that you can do your job and do it well to serve the most vulnerable that we have. So, thank you very much for the work you do.

Dr LaPorta: You're welcome.

Mr Hoy: Thank you for your presentation. I found it enlightening that over 50% of the children served by CTCs have three or more serious health problems. I've met with special-needs parents, as I'm sure many of us have, and the more serious ones with multiple challenges present unique problems and the parents find themselves lost, even at times when they are receiving some help. When they receive very little or not enough adequate help, it is quite difficult on the family, the extended family beyond that household even.

You mention that children and families are "waiting longer for less service" in part of your brief that you didn't mention in your oral presentation. Has that been alleviated, or is it increasingly so that people are waiting longer for less service?

Dr LaPorta: That is the reality. While there have been some recent funding increases that came from the ministry for all of our centres, it's a combination of realities. First of all, contrary to a myth in our society today, the numbers of these children are actually increasing. Some of that is because of some of the new initiatives in earlier identifications. Some of it's due to new technology. We have children surviving today who didn't survive 10 years ago. As well as those things happening, what has happened is that, as a result of inflation and being locked into frozen budgets, basically we're operating with less money today for services than we had even six years ago. So what has happened is we have more demand for our services; we actually in some respects have less service available, so we have more individuals waiting for longer periods of time.

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What many of our organizations have done is we've actually cut back the level of service to clients. I'll use our centre as an example. We average about 25 hours per child per year. Five, six years ago we were probably upwards in the neighbourhood of 40 hours per child per year. And 25 we feel is just at the standard line. Anything below that and we're probably slipping below. That's our situation today.

Mr Hoy: Later in your written presentation, you mention that a total investment of up to $22 million is needed to stabilize service loads for core services at a minimum standard. Is that $22 million an annual figure?

Dr LaPorta: Yes, it is.

Mr Hoy: What were you receiving in 1999?

Dr LaPorta: As an entire system, which includes 19 centres, it's approximately $63 million.

Mr Hoy: Thank you.

The Chair: I guess that completes the questioning. On behalf of the committee, thank you very much for your presentation this afternoon.

Dr LaPorta: Thank you very much for your time.

The Chair: We'll take about a five- or 10-minute recess until the next presenter comes in.

The committee recessed from 1341 to 1349.

ALLIANCE OF CANADIAN
SECOND STAGE HOUSING PROGRAMS (ONTARIO CAUCUS)

The Chair: If I can get your attention please, we have the next presenters, from the Alliance of Canadian Second Stage Housing Programs. On behalf of the committee, welcome. If you could state your names for the record.

Ms Ruth Hyatt: Thank you very much. To my left is Donna Hansen. She's our program coordinator with the Alliance of Canadian Second Stage Housing Programs. To my right is Wendy Makey. She's our vice-president. I'm Ruth Hyatt. I'm the president of the Alliance of Canadian Second Stage Housing Programs (Ontario Caucus). Thank you for inviting us here today.

We come before this committee today on behalf of the membership of the Alliance of Canadian Second Stage Housing Programs to implore this committee to commit to making adequate funding of second-stage housing programs in Ontario a priority in the upcoming budget.

We understand that the provincial government has every intention of making it safer for women to live in this province. The events of this past summer that led to the deaths of five women and four children underscore the need for safe and supportive housing programs in this province. Studies have shown that women are most at risk when they are leaving the abuser. Second-stage housing provides that additional safety and support for women who are leaving these abusive relationships.

In 1995 second-stage housing lost all funding from the province to support counselling programs. As a result, second-stages across the province have been devastated. There has been a significant loss of programs, staff and ultimately safety and support for the women and children accessing the programs. Boards of directors and staff in these organizations have had to shift their focus toward fundraising to survive. Second-stage housing programs in this province need your immediate attention. Please listen carefully to our concerns.

I'll tell you a bit about second-stage housing. It was developed in response to an identified need for longer-term safety and support for women and children leaving abusive relationships. Emergency shelter workers witnessed women returning to abusive partners after leaving shelter because of a serious lack of safe, affordable and supportive housing alternatives in the community.

Approximately 40 women are murdered by their estranged partners each year in Ontario, according to a 1994 study of intimate femicide. The study also shows that women are most at risk and often killed after leaving the relationship.

The first second-stage housing program in Canada was built in 1979. Between 1985 and 1995, the number of second-stage housing programs in Ontario had grown to 28. A 1996 survey by the Canada Mortgage and Housing Corp shows that safety is the number one reason that women, with or without children, seek housing at second-stage facilities.

Today, there are 26 second-stage housing programs operating in the province of Ontario. The facilities range from three units to 40 units, with a total of 366 units. They are typically self-contained apartment, townhouse or single-family dwellings where women can live independently with their children for approximately one year. The length of stay depends on the needs of the woman and the program guidelines.

Women often access second-stage housing after leaving first-stage shelters. Living in second-stage provides women the opportunity to rebuild their lives and the lives of their children in a safe, affordable and supportive environment.

Second-stage housing provides a unique service to women and their children. Women living at second stage are usually on a low, fixed income. During their tenancy, women are able to set goals and objectives, connect with appropriate community resources and are provided the opportunity to build on new skills as they move on to economic independence. We like to think of second-stage as a proactive form of program.

Now I'll hand it over to Donna for the internal report.

Ms Donna Hansen: Marie McKeary, a research consultant, prepared on our behalf an internal report based on returns of questionnaires that she sent out to second-stage housing programs in Ontario. The summary said that she found the Alliance of Canadian Second Stage Housing Programs (Ontario Caucus), to be a collective body composed of 23 of the 26 second-stage housing organizations which exist in Ontario. The report was the second step in a process to standardize protocols of second-stage housing programs, to develop strategies for the alliance to improve its effectiveness and to raise the visibility of second-stage housing issues. The first step in achieving these objectives was for the alliance to host a conference in September 1999 in Stratford, Ontario.

The goal of the report was to poll members of the alliance and determine areas where policies needed to be developed. The following is a summary of the findings. She received a high response rate of 52% of the questionnaires completed and returned to her.

The earliest organization was founded in 1986. New programs have come on board as late as 1998. This was prepared in October 2000. Since then one other has come on stream, and one in Ontario has changed its mandate from being a hostel to second-stage housing, then we learned of the YWCA running one in Sudbury, so we are now up to 26.

The average age of all programs reporting was nine years and a majority of those programs serve urban areas. A majority of the programs have either a strategic plan or a business plan in place. Of the members reporting, 73% were forced to implement major structural and policy changes within their organizations as a direct result of the 1994 government cuts to funding. Impacts included a loss of all counselling programs or a loss of some of the counselling programs, significant staff cuts, and the remaining staff had to multi-task.

There was a constant relocation of some second-stage housing programs to find affordable space. The organizations had to be restructured. There was a major shift in focus to fundraising to support counselling programs. Some level of security features is offered by 92% of the programs, including controlled entry, a fenced-in yard, extra lighting, video cameras etc.

Access to clerical support was reported by 58% of the members. Twelve members were forced to refuse shelter to 837 women and children in 1999. The main reason given for the refusal was a lack of resources, including physical, financial and human resources.

Support in most programs is offered through individual and group counseling in order to assist women and children to develop coping strategies, build social networks, enhance self-esteem, understand the impact of violence on their lives and develop realistic plans for their futures.

Many of the children and youth at second-stage housing have been the targets of physical and sexual violence and most have been witnesses to woman abuse. According to Children Exposed to Woman Abuse, a recent handbook that was compiled by the London Family Court Clinic, "Children who witness woman abuse frequently experience post-traumatic stress disorder. The symptoms of post-traumatic stress disorder include extreme anxiety, fear, irritability, intrusive thoughts and flashbacks about the violence, unpredictable anger outbursts and avoidance of situations which remind the child of the abuse witnessed."

These children have a number of needs in common. They need to be able to break the silence of abuse. They need to learn about safety planning in case the abuse recurs. They need to learn they were never at fault. They need to process the traumatic memories in a safe and nurturing environment and they need assistance with coping strategies around trauma symptoms such as irritability, avoidance of situations which remind them of the abuser, anger outbursts, withdrawal, fearfulness, tension and intrusive memories. They need to learn that there are alternatives to violence in relationships and that violence is not acceptable. They need to learn about equality in relationships and have the myth about woman abuse dispelled.

Individual and group programs strive to increase children's and youth's knowledge and awareness of these issues, develop coping skills and support them in making healthy choices in their lives.

You can see from the graph on the next page that 12 of the 23 programs at the time reported. Of those 12 programs, there were 196 units that sheltered 333 women. However, nine programs reported that they provided services that did not include housing to 748 women. Children serviced and/or sheltered by these 12 programs that reported were 523. The maximum length of stay allowable ranged from two years to eight months. However, the average length of stay for all programs reporting was 12.5 months. The 1998 statistics indicated an average stay of 8 months.

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Programs vary from organization to organization: 82% offer cultural interpreting; 64% offer services for deaf and hard-of-hearing clients; 83% offer an advocacy program; 83% offer counselling programs, however only 40% of those reporting were able to offer programs on-site, a direct result of the cuts in 1995; 67% offer education and/or public awareness on a limited basis; 75% offer programming geared specifically for children, but most often this is limited, and often only offered through volunteers or students.

One hundred per cent of those responding had some form of evaluation, including staff, client-programming, board and community input. Ms McKeary found regarding funding that common sources of funding include federal, provincial -- which is only housing dollars -- regional, rents, fundraising, foundations and grants. Ninety-two per cent report a major focus on creating sustainability by organizing and hosting events and activities that include but are certainly not limited to dinners, flower sales, garage sales, golf tournaments, concerts, fashion shows, aerobathons, yard sales, T-shirt sales, and I'm sure the list can go on and on.

Regarding policies, Ms McKeary found that the top five areas of policy development identified as priorities were safety and security, funding, programming, occupancy, and human resources and personnel.

In her conclusion, she writes:

"In conclusion, I believe the Alliance and its individual members have begun a crucial, complex and ongoing journey to strengthen the organization, improve service delivery and ultimately bring about positive social change on behalf of their clientele.

"Although completed over a brief time, this report offers a rich and multi-faceted depth of information. Its strength is a reflection and testament not only to the time individuals donated to the project but to the commitment of time and energy expended every day to empower women and children caught in the web of violence."

The Chair: That completes your presentation?

Ms Hansen: No. I'm sorry.

The Chair: OK, go ahead.

Ms Wendy Makey: The final piece we'd like to speak on today is the financial status of second stage housing programs across Ontario. The biggest struggle facing all second stage housing programs today is the serious lack of funding to support programs. However, the impact goes beyond the cuts to staff and to services. The number one reason that women enter second stage housing is for safety. In many programs, safety and security have been compromised for two reasons: (1) there are insufficient funds to repair, maintain and upgrade security systems and (2) there is insufficient staff to ensure safety policies and procedures are followed. At times, staff and volunteers are at risk from abusive partners determined to have access to the women. Every effort must be made to ensure the safety of everyone connected to the programs.

In Dryden, because of the cuts to funding, the second-stage housing program is now under the administration of the local housing authority, addressing only priority status issues. There is no staff on-site to provide any level of counselling or support.

Partnerships between violence against women agencies and community groups are used to develop prevention initiatives and public education events and to coordinate the services provided to victims of violence. Most staff in second stage housing programs report that it is difficult, if not impossible, for them to attend violence against women services community coordinating committee meetings, children's services coordinating committee meetings and domestic assault review team committee meetings because of a serious lack of time, money and staff.

Credibility has become an issue for second stage housing programs throughout the province. Systems were in place when programs were funded to ensure that programs were supportive, responsive, and accountable to the women and children using the programs. The complete withdrawal of funding to support the counselling services disconnected the programs from the government body that gives direction to all other violence against women service providers. Therefore, we are no longer directly involved in policy development and program planning, which also means that the women and children using our services have been taken out of the decision-making process.

Many program directors found that prior to 1995, information flowed through the provincial funding body. When funding was cut, information stopped flowing. In order for service providers to maximize women's safety, it is imperative that they keep abreast of changes that occur in the system. It is most difficult for many of the programs to keep abreast of the changes. An example of information that has not reached all second stages are the changes to child welfare legislation involving reporting procedures and service delivery changes.

Though staff training is a priority for many second stage housing programs, it is impossible to allocate funding resources or staff time for training and development. Many second-stage housing boards, volunteers and staff have also needed to change their focus to that of fundraising for survival of the agency. Day to day issues and actual work with the women and children must be attended to around fundraising schedules.

Though second-stage housing programs may vary in size, configuration and management style, the mandate of all programs is to deliver services which contribute to keeping women and their children safe. We need the help of the provincial government in order to continue to provide these efficient and cost-effective programs. Many second-stage housing programs in the province of Ontario have experienced significant losses of staff. Many have left exhausted and burnt out.

In the five years since 1995, all programs have changed. Counselling programs have been carved to the bone. Many second-stages are in crisis survival mode. Today, on behalf of the Alliance of Canadian Second Stage Housing Programs (Ontario Caucus) we are asking the provincial government in Ontario to support the continued operation of these efficient and cost-effective services for women and children who are fleeing abuse in this province. We are requesting $120,000 in annualized funding for each second-stage housing program in the province of Ontario. This would total $3.36 million.

We'd like to thank you for your time, and we are here to answer any of your questions.

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

Mrs Molinari: Thank you very much for your presentation. Certainly, you've made some excellent comments. I would just like to state for the record what the government has invested in order to prevent violence against women and children: in 1999-2000, $110 million was invested; $135 million in 2000-01; and that investment will increase to about $140 million for 2001-02. This is for programs and services that address and prevent violence against women and their children.

There are also 40 programs and initiatives involving 10 different ministries that address some of the concerns. Some of these programs are the 33 sexual assault-rape crisis centres that provide 24-hour crisis support accompaniment, and public and professional education and information and referral services. A victim's crisis assistance and referral service provides 24-hour-a-day service in which police, with the consent of the victim, request a highly trained team of volunteers to provide short-term assistance to victims and make referrals to community services for longer-term assistance. The victims' services line provides toll-free information in English and French on a number of services to victims. SupportLink, a pilot project with private sector partners, provides wireless phones pre-programmed to 911 and safety planning to victims identified as being at risk for sexual assault, domestic violence and/or stalking. The sexual assault treatment care centres are available in 28 hospitals in the province, seven of which also provide services to the victims of domestic violence. The children's aid society staff and front-line staff working with abused women are being trained to provide specialized counselling and related services in child abuse cases that involve violence against women --

Mr Christopherson: On a point of order, Chair: This is about the third, maybe the fourth, time now the government has deliberately used the time to dialogue and ask questions of presenters to just read verbatim correspondence into the record, using up the time, avoiding the issue. I'd ask you to direct the government caucus to at least provide -- there's nothing wrong with providing some background information, but to use it as a diversionary tactic, to disallow any dialogue because you're afraid to answer the questions, is wrong and is against the spirit of what these hearings are about.

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The Chair: I can see your concern. However, as Chair of the committee, my only role is to maintain decorum. Whatever time any caucus has and how they use that time is up to them. There's really nothing I can do about that. Each caucus has four minutes on this particular matter. If that's what they want to do with their time --

Mr Christopherson: Perhaps just raising it will change the patterns. Thank you.

The Chair: Go ahead, Ms Molinari.

Mrs Molinari: Thank you, Mr Chair.

I will continue to clarify for the record the government initiatives that have been put forward. Building Opportunities for Women is a pilot project that links women in shelters with employment, education and literacy services to help them achieve economic independence. The cultural interpreters are available from 10 sites across the province for abused women who speak languages other than English and French and are in need of support services.

There are a number of others. Counselling is provided through the victims of violence program to female offenders who have been physically and/or sexually abused at some point in time in their lives. There are several others that I could put on the record. There's French-language services that are available in several places across the province. There are a number of initiatives, as I've stated, that the government has taken to address some of the concerns.

The concern you have is also a concern of ours. It's different ways that various governments and various parties have of addressing the issues. The second-stage housing that you're referring to is one way.

I would like to ask if you know of any other province in Canada, just to have some comparisons of what other provinces are doing to address some of the concerns that you've raised here and how we as Ontario compare to other parts of the country.

Ms Hyatt: I'll respond to that, if I can. In 1995 we had been very active in communicating with second-stages across the entire nation. But with the cuts in 1995, we actually lost contact for a year and half to two years with even the provincial second-stages. We were almost cut afloat, so to speak. We were barely in connection with second-stages in Ontario, let alone those across Canada. We have regrouped as an alliance and have pulled our forces back together so that we can start providing support to other second-stages in the province. But we have not had the time or the resources or the finances to reach out and connect with other provinces. We've lost that connection.

The Chair: We've run out of time.

Mr Hoy: Thank you very much for being here today. Would it be fair to say that if not you individually, your staff and other volunteers would know of those other avenues that the government just read a few minutes ago that are available to the public, and women and children in particular? You would have known that, I assume; if not individually, your staff would?

Ms Hyatt: Yes.

Mr Hoy: Even with that, you obviously believe that second-stage housing is important to women and children and the communities of Ontario.

Ms Hyatt: We do know that there are waiting lists for probably every program. We haven't polled everyone recently, but at this point we have a lot of second-stages with waiting lists across the province. On average, I believe we have a 92% occupancy rate, which is very high when you consider we have a changeover time as well in the programs to allow new residents to move in. So I think the need for the program has definitely been established over time. The effectiveness as well has been established.

Mr Hoy: Thank you. You mention in your brief that women living at second-stage housing units are usually on a low or fixed income. Would it be possible that in the beginning, when they first come to visit you, they might have no income?

Ms Hyatt: That's possible. I'm not sure how other programs deal with that, but we do assist women in trying to access some kind of financial support.

Mr Hoy: But initially, that first day, they may not have any?

Ms Hyatt: Quite possibly, especially if they have assets that are tied up in the courts, because they can't get social assistance at that point.

Mr Hoy: You mention also in your brief that a majority of the programs serve urban areas. I suspect, if you had adequate funding, that there would be a need for rural areas as well. Do you have problems with that situation where people in rural areas are actually looking for a place to go that might be some distance from where they live now?

Ms Hyatt: Currently what we find is that to access the service, women will move from the rural areas into the city.

Mr Hoy: But the problem is not restricted to urban?

Ms Hyatt: No, definitely not. In fact, there is a large group that looks at farm women and the rural population in terms of the special needs they have.

Mr Hoy: In your brief you also mention that women can live independently with their children for approximately one year. Does that mean that after a year you would ask them to leave, or is that just a general statement?

Ms Hyatt: Depending on the woman's situation, the average length of stay may be of six to eight months. Depending on the program and the situation at hand, the woman would not be kicked out on to the street. We try to help her obtain subsidized housing within the community but, depending on the situation, we would extend her length of stay if needed.

Mr Hoy: Thank you very much.

Mr Kwinter: Could I just get a quick rundown of how this works? I understand the program and the counselling and everything else. Who provides these houses? Do you rent them? Do you own them? How does this system work?

Ms Hyatt: Specifically in Hamilton we have 20 units scattered throughout the community. Non-profit housing corporations have given us units. Within the community the women pay a subsidized rent dependent on their income and pay the rent to us, and we then pay the housing corporation. They're responsible for hooking up their own telephone, hydro, gas, television etc.

The Chair: Mr Christopherson.

Mr Christopherson: Thank you for your presentation. This is one of those issues which just makes no sense on any front whatsoever. The government has been taking more heat over this. Time after time, every year, whenever there's an issue that has us addressing this they always get hit with the fact that they've devastated second-stage housing, and I note now that you're down to 26. All the funding has been gone for quite some time.

You mentioned too the information flow. I was pleased that your answer to the government member was the core, that rather than saying, "No, we don't have the information," you went on to explain, "We don't have the information because since 1995 we haven't had the money to even communicate with our own members, let alone find out what's going on across the province."

When I look at this, I have to ask myself what is driving the government on this issue. Why this one in particular? If I'm wrong I'd be pleased to hear from the government members on the record or off the record, but you have to wonder, is there a philosophical issue at play here with the government? Is it their determination that they're going to have Ontario try to reflect the fantasyland vision of home in the 1950s as Leave it to Beaver had it, that they're going to force children and mothers and wives back into families? I don't know. If I'm wronging somebody, fine, jump in and say so, but I can't find a reason.

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Every organization that's involved with violence against women says that funding for second-stage housing ought to be reinstated and ought to be expanded -- unanimously -- and why they continue to refuse just infuriates me to no end. Women are being hurt and being sent back to situations where the children and the women are going to be abused again, and there is an obvious solution that at least helps and they won't do it. It drives us crazy, because there seems to be no rationale for it. Even if they didn't believe in it, you'd think they'd do it for political reasons. So I wonder, as I say, if it's not some sense -- they've got this weird what they call "family values caucus," if you can believe it. This is the group that is sending people off to work 60 hours a week, so they're going to be away from their families even more, but they still want to be considered the only party that cares about families. I don't know whether they've got a throttle on this issue and said, "We're not going to support programs that keep families apart," and that's as far as they think about it.

I don't know whether you have any thoughts on why this is happening. It absolutely drives me crazy that this is happening because I know the kind of work that has been done in Hamilton; I've known about it for a long time. Why it's not supported is beyond me. If you've got any issues or reasons and want an opportunity to lay them on the table, let's do it now, because something is missing here. It's the element of common sense. Unfortunately, it's not just a debate. People are being hurt; innocent people are being hurt. Since everybody agrees that they should put the money back, I don't know why they won't.

Ms Hansen: We have no answer to that either, Mr Christopherson. We have bandied this question about, when the alliance gets together, since 1995, and we have no answer and have received no answer. It would be nice to have one. We don't know if we have upset someone or hurt someone's feelings or if we have done something the government has not approved of or what it has been. We have received no answer and, like you, would like to have one.

Ms Hyatt: Another thing we have wanted to do as well was to have the government come and visit our programs and talk to the women who have actually used the programs because they are the ambassadors of second stage. These are the women who find the success in our programs. Quite often they come into the program very confused, upset, not knowing which way to turn because their whole world is upside down. In the time they spend in our programs they grow, they learn, they change, they develop and they move on to economic independence. Sometimes I've watched women come in, and when they're leaving I think, "Wow, she's done her work. She has worked really hard to get to where she needs to be to make those changes."

The Chair: With that, we've run out of time. On behalf of the committee, thanks for you presentation this afternoon.

Mr Galt: On a point of order, Mr Chair: Could I ask for unanimous consent for time for Mr Christopherson to explain why his government wouldn't allow a shelter for women to be built in the county of Northumberland?

The Chair: I think that's out of order, Mr Galt.

Mr Galt: I thought he might like to do that with his --

Mr Christopherson: Struck a nerve, eh, Doug?

Mr Galt: You could explain --

Interjections.

The Chair: If that's going to continue, Mr Galt and Mr Christopherson, I'm going to have to recess the meeting, and I'm sure some people are going to be --

Interjection.

LONDON MUSLIM MOSQUE

The Chair: Our next presentation is from the London Muslim Mosque. Could the presenters come forward, please, and state your names for the record.

Interjection.

The Chair: Mr Galt, come to order, please.

On behalf of the committee, if you can hear me, welcome.

Mr Adeeb Hassan: I am Adeeb Hassan, chairman of the board of directors of the London Muslim Mosque. At the projector is Dr Ashraf Eldamatty, vice-chairman of the mosque; and to my right is Mr Hassib Zabian, the treasurer of the board of the mosque.

Mr Chairman and committee members, I would like to thank you for giving us the opportunity to meet with you today to discuss issues that are important to us as a community. On behalf of the London Muslim community, I'd like to give you an insight into the development of the community and the London Islamic School, and as well present to you some of our thoughts on developing a partnership in education.

The first known Muslims arrived in Ontario in the late 1800s, coming mainly from Syria, young men who left their families and country to seek a better life here in Canada. For the next 30 years, the number of Muslims remained small. In 1939, the first Muslim family established in London when one of the pioneers returned to his homeland to marry and return to London with his bride.

The community began to grow slowly, and in 1955, on Oxford and Summit streets in London, a property was purchased and a large home on the site was renovated, thus establishing the first mosque in Ontario. In 1961, this building was destroyed by fire, and the present mosque was constructed in its place and opened in 1964.

Since then the community has thrived. Second- and third-generation Muslims living in London, along with a huge influx of immigrants beginning in the 1970s, have seen our community grow at a rate tripling its size each decade for the past three decades. With this growth came enormous responsibility and challenges for our community leaders to keep up with the religious, educational and social needs of such a flourishing community. Over the past 10 years, the London Muslim community has invested over $3 million in purchasing property and constructing the required facilities next to the existing mosque, which consists of an elementary school and gymnasium to serve out community needs as well as to make available for our neighbours in that area of the city. In addition to this, the community has established a second Islamic centre on Pond Mills Road, just south of the 401.

In 1994, the London Islamic School was opened and dedicated to stressing Islamic values -- values such as faith, truth, helping others, serving the community, respecting diversity of faith and ethnicity, discipline and good conduct. We have approximately 200 students enrolled in our school. The LIS curriculum is based on the Ontario Ministry of Education requirements for each grade level.

Last year, our grade 3 and 6 students participated in the Ontario-wide testing of reading, writing and mathematics. Our students achieved above-average scoring results, based on the provincial results. This result was extremely satisfying to us, given the fact that our school receives no funding outside our community resources.

We believe that the Ontario government's ongoing refusal to fund these charter schools is a disservice not only to the faith communities operating them but also to the taxpayers of Ontario. If we were to follow other provinces' funding levels of charter schools at a rate of 50% to 60% of public school funding, the Ontario taxpayers would save millions, if not billions, of dollars. The Islamic Schools Federation of Ontario estimates that there are approximately 80,000 Muslim students in the public system. You can do the math that if only 60% of these students were to move into a publicly funded charter school, the savings would be found not only in funding levels but also in facilities, which would be provided through our own resources. We deem that it would be a wise move for the government of Ontario to study this more closely and not to brush it aside so deftly.

You have communities that are willing to build or purchase schools, to cover 50% of the operating costs and continue to achieve the high standard of education promoted here in Ontario. Isn't it worthy of consideration and further study? The LIS school board of directors is at your disposal as a resource for further information on our school and its operation. I'm also assured that the Islamic Schools Federation of Ontario would be willing to help in any capacity to aid your study of this important issue.

The London Islamic School is open any time for anyone interested in visiting and seeing at first hand the professional manner in which we operate. Talk to our teachers and visit with our students, and then try to explain in your heart of hearts why your government refuses to see the injustice of your policy not to fund all religious schools through some mechanism. It should not take a tribunal at the United Nations to help us to make the point of simply seeking our equal rights as citizens of Ontario, citizens with a long history as hard-working, dedicated people who love this country and this province and proudly call it home. We simply ask that your government policies indicate that you also recognize us as equal citizens; not just as taxpayers, but as mothers and fathers, sons and daughters who wish to participate and live in an Ontario that encourages unity through our diversity and promotes fairness and equality for all.

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

Mr Kwinter: Thank you very much for your presentation. This is an issue that I am very, very familiar with. I can tell you that in the community I represent, it's an issue that has been out there for many, many years. I totally agree with you. I have been supporting this concept for 15 years, notwithstanding that when we were in government I could not convince my government to support it. Just to be fair, the other two parties have also had the same issue and they've all refused to do it.

There are several issues. One of them is -- and this has been challenged in the courts -- under the British North America Act, it has really been set out that the funding was to be provided on an equal basis to both the English Protestant community and the French Catholic community, and that has carried over. Notwithstanding that several ethnic groups have challenged this in the courts, the Supreme Court has ruled that this is the case and that it cannot be changed. It's an issue.

One of the things that I have been advocating as a minimal sort of compromise, and I'm sure it's an issue in your community as well, is that not only is the Muslim community providing this facility -- I haven't seen it physically, but from the slides it looks like it's an outstanding facility -- and charging the students who come there to support it, but those people are still paying their public school taxes. So in effect it's a double penalty. They're not getting any funding from the government, they're paying funds into the school system that they're not using, and they're providing a comparable education, if not a superior education, because they're getting the requirements as set out by the Ministry of Education plus their particular religious training.

I have felt that as a minimum compromise there should be at least a tax credit for that amount that is being paid to the public school system because, as you say, if those students were turned back into the public school system, there'd be a huge cost. Have you proceeded or have you put forward that argument with the government?

Mr Hassan: No. In the discussion I personally had with one of our members of provincial Parliament here in London, we discussed a voucher system. I read about the idea of a tax break for those who are spending on tuition in private schools or charter schools of a religious base. But our discussion has always been based on a voucher system to support the operation of the school.

Mr Kwinter: One of the big arguments that is put up to deter any of this from happening is that if you had a voucher system, it would in fact so fracture the public school system that it would no longer be viable, because every group would want to establish their own school. As a result, the only people who would be left in the public school system would be those who didn't have a group they could coalesce with to establish their own school. Do you have a response to that?

Mr Hassan: I find that hard to believe. I don't think the mass exodus would occur. I think there would be a number of people who would move over to the privately funded schools through their faith communities or whatever community it is they belong to that's operating a school. But I don't think that even in the Muslim community we would see 100% of the students in the public system move into the private school. I just don't think that would happen.

Mr Kwinter: I hope you understand, I'm just throwing out these questions to see if you've got any arguments.

Mr Hassan: Yes, and I'm giving you my --

Mr Kwinter: I've argued this issue for 15 years. Yes?

Mr Ashraf Eldamatty: If I can add something, remember that these schools are built by the communities, so the communities have a certain limit. The Muslim community in London has struggled for over the past 10 years to build the facility of $3 million to accommodate something like 400 or 500 students. We don't expect a community to be able to build for a huge amount of students so it will take everybody from the public system. It will never happen, if you'd like to be realistic.

Mr Hassan: In other words, the community couldn't absorb the so-called mass exodus, if it were to happen. It wouldn't happen.

Mr Kwinter: What is the size of the Muslim community in London?

Mr Hassan: It's 30,000.

Mr Kwinter: Again, I don't want to make your arguments for you; I would like you to make the arguments.

Mr Hassan: No, you go ahead.

Mr Kwinter: One of the other issues, of course, is that there are many other jurisdictions in Canada that have been providing funding.

Mr Hassan: That's what I was going to ask you, because you mentioned about the BNA that provides for funding for Catholic and Protestant schools. How did the other provinces get around that when this is a Canadian law, not provincial?

Mr Kwinter: You have to understand that law is used only if you don't want to do it. If you want to do it, you don't have to worry about it because it doesn't say, "You must not do it." What they're saying is that if a government decides not to fund it, this is the way out.

The Chair: Thank you very much. Mr Christopherson.

Mr Christopherson: I will continue the same discussion, because the parameters of the debate I think are fairly well defined and actually fairly limited. It really comes down at some point to an opinion of whether or not you believe that any fracturing of the public education system is bad and ultimately is to be seen as the slippery slope.

I have the greatest amount of respect for your religion, for your beliefs. I think they contribute enormously in a positive way to the Canadian culture, and the fact that you're able to maintain your own schools says a lot about the commitment of your members.

But I am one of those who is very concerned about starting to fracture off -- notwithstanding the constitutional issue, which is one we can debate or not debate, but as Mr Kwinter says, there it is. It was part of the founding understanding that created what we now call Canada, what evolved to modern-day Canada.

Beyond that, we've taken a strong stand. Our public education system has been noted as one of our key strengths. We are known around the world as having one of the best education systems, and please don't take that as any suggestion that you're not providing the same standards. That's not the issue here at all. I have no doubt that you are, but I am merely saying that if we don't keep concentration of dollars and attention on the public school system that we have, then we're going to start to fracture it.

Is that a bad thing in and of itself? Probably not. I don't think it's evil. It's a question of which, in one's individual opinion, is better: to have a strong, united education system or to have one that's broken into various pieces? I just happen to believe that it makes such a difference for us, and I think the evidence is there, that it has served us well, that it really is the slippery slope.

Whether 100% of your community went to the Muslim school or not, and the same with the Jewish community, and you could do the same with virtually any religion -- by the way, that creates a little subset of problems too: how do we ultimately define "community of interest" and how do we define "religion"? We have an interesting couple of ministers in Hamilton who get headlines in Canada from time to time, and I'm sure they'd love to start up their own school. So that becomes a subset of problems.

Again, I just emphasize that it's not a question of looking and saying this is a bad thing. It's a question of what's in the best interests of Canada, what has worked for us and what has given us the quality of life that we have? To date, I would argue the evidence is there for us to keep a secular, public education system.

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Mr Hassan: Certainly no one wants to destroy or fragment the system that we have. Speaking for our community, we would like to offer an alternative for our community for the children to be educated to the high standard that we have in Ontario, but to be able to impart to them at this crucial stage the morals and the judgment that are required and to take away the peer pressure they have in the public school system. We have found that our children attending these schools are doing without a lot of those issues, and the parents are not dealing with a lot of those issues either. For that, we benefit as a community. We also can see, as Canadians and Ontarians, that we're not reinventing the wheel here. You can look at other provinces where this is being accomplished and you'll see that the public system has not been destroyed or even fragmented. So we're not treading on new ground by looking for Ontario to fund these schools, because it's being done quite successfully without any detriment to the public system.

Mr Christopherson: It remains a point of debate and ultimately one of politics. Again, the difficulty here is that this is one of those issues where there's really no membership to our cards that guide this. This is a question of not right and wrong or someone else's rights versus someone who doesn't have any rights; it's a question of what are your rights and how do they stack up against other rights, and when you can only pick one, where do you go? Sometimes compromise is a good idea; sometimes compromise is the beginning of the slippery slope.

Mr Hassan: But changes are sometimes a part of life. Demographics change in this country. Things are not demographically the same as they were in 1867 or even in 1967. So for our government to stick their head in the sand and say, "This is the way it has been and this is the way we think it should stay, because we're proud of our public school system," and just throw our hands up and say, "We don't really want to look at anything else" -- what we're asking for as a community is just to study this, just take a good look at it and see if the fears are founded and if our claims are reasonable.

Mr Christopherson: Again, my sense of it is that in this case it's not one of really just refusing to look at any kind of change. I've been an active participant in advocating change most of my adult life. It's a question of not letting go of things that you're clear that work. Right now we have a secular system that doesn't favour any religion, again notwithstanding the Catholic, and we've talked about that. We have a secular system that says religion is not going to play a role in the public education system, regardless of what your religion is. It could be anyone who would come to the table today, and my comments would be the same.

It's the same worry that many of us have about public health. It was interesting that Mr Kwinter talked about people worrying that they're paying double. That's one of the concerns that I have about further privatization in the education system, but also in the health care system: that people then begrudge paying twice. We know that the affluent tend to vote more as a percentage of the population, and suddenly religion becomes a huge issue in our education system, and right now it's not. I think so far that has served us well. If there are compelling arguments, one has to try to keep an open mind; so far I haven't seen them.

Mr Hassan: We don't want to make it an issue.

Mr Christopherson: But it is the issue, actually, isn't it?

Mr Hassan: We just want to be able to raise our children with our morals and our understanding. I can give you a personal anecdote. When my daughter, who is now in Western, was in grade 7, they were going to hand out condoms in her classroom. I went down and met with the principal and the health teacher, I think it was, and I asked that she be removed from the class and sent to the library for the period because we have our own moral judgment on premarital sex. I don't want the public system to impart their secular impression of premarital sex and safe sex, because safe sex is not something that we discuss. We discuss no sex before marriage; that's what we teach our children. I was told that that couldn't happen, that this course was mandated just like mathematics and science and the rest and she had to be there. I did my job as a parent. So we're not trying to push our values on anyone.

Mr Christopherson: No, and trust me, no one is trying to prevent your values from having their equal place in our society. It becomes a question of what we think the best structure is for Canada in terms of our education system, and I think there are still fair numbers who think, regardless of our own personal religions, that the secular approach we have, albeit not perfect, is the best one to date.

I know you're going to press me for time, Chair, but let me just say that as long as we can continue to have dialogue in this fashion, I think it serves us well. That it was Mr Kwinter who opened up the discussions -- we serve the history of Canada and the tradition of democracy well when we can talk about something like this in this fashion rather than some of the other ways of settling these things that are happening in the world. I really respect your opinion and appreciate your coming in and the kind of dialogue we've had.

Mrs Molinari: Thank you very much for your presentation. I represent the riding of Thornhill. In Thornhill there are five Jewish day schools, one Muslim and one Montessori. In the province of Ontario my riding is probably the one that has the largest number of denominational and private schools.

I was interested listening to Monte Kwinter's comments about his support, and he and I had some discussions about this issue not too long ago. As much as the Liberal government and the NDP government have not made any steps forward in this direction, our government provided in the year 2000 $3.4 million for health services for students in denominational schools and $11 million this year to provide for those services. So as a government there is recognition that there are some inequities that exist and that some of those services need to be addressed.

I meet with people in my constituency office weekly on this very topic, and having myself been a trustee for the York Catholic board and the chair of that board for four years, I know too well how difficult it is to pursue equity in funding for education and for denominational. One of the issues around pursuing funding for this is also keeping in mind that there may be some loss of autonomy, because whenever you're receiving grants and funding from a government source, there are certain parameters that you have to live within, and are those parameters things that you would want to live within. So that's a whole discussion that needs to be ensued on this topic, because the way you're funded now, you have complete autonomy over what it is that you do. Certainly that's something to keep in mind.

With the groups that I meet with in my office, we've talked about some possibilities of assisting in some of your expenses and some of the things you have to purchase. One of the things I'm working on with those in my riding is opening dialogue with the two school boards in the riding to look into the possibility of combined tendering and combined purchasing so that there are cost savings incurred by buying in bulk. Those are areas that I encourage you also to explore in doing that with the local boards in the area that you represent.

The Ontario Parents for Equality in Education Funding is an organization. I don't know if you're familiar with them. They have as their membership a number of various groups with the same issues and topics that you've raised here, and they've combined their efforts in making presentations on this very issue. They've come up with some very creative ways of assisting in some of your expenses. As I said, one of them is combined purchasing of services in textbooks, because some math books and English books are the same that you use to offer the Ontario curriculum. Those are some areas that I encourage you to explore to assist at least in the short term.

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We're engaging in a visioning exercise in the next few months. I've encouraged my constituents to become involved in that visioning exercise, that sets priorities and principles of what you'd like to see the province of Ontario look like in the year 2015 and so on. Those are some of the things that I encourage you to become involved in, because if those are priorities of your organization and your group, then I would encourage you to get into the areas where you're going to be able to influence some of those decisions.

Again, thank you for your presentation. It's not the first time I've heard this. It's as familiar to me, I think, as it is to Monte Kwinter in his riding. I appreciate your unique presentation on that issue.

The Chair: Mr O'Toole, you have 90 seconds.

Mr O'Toole: I just wanted to say that I also have met with the stakeholder groups in my riding. Certainly in listening, you've presented a very good case. So has Mr Kwinter, in outlining the history.

I do want to lend support for, as Mr Christopherson might say, traditional alternatives -- as if they have no value, sort of implying that some kind of new model of the family is more appropriate for society. So I am supporting the importance of home and culture -- be that community or church -- and school, as a fundamental triangle relationship, a shared relationship.

At the same time, the conflicting challenge before all of us as Canadians would be, we've sort of sold this John A. Macdonald vision of Ontario and Canada. Trudeau called it the multicultural mosaic. It's all nice words, but with those mosaic issues comes the very difference of what we are looking to the Supreme Court for. This will probably be decided some day in the Supreme Court. The constitutionality and the British North America Act and those issues will be described there. So we are listening and we realize that the culture we represent is changing as well.

The Chair: Go ahead, if you want to make a comment.

Mr Hassan: My final comment would be that we're looking for dialogue and further discussion and study by our government on this issue to look at the pros and the cons, weigh the issue in the balance. If we're correct, and we feel we are, then we would look for some action by our government.

The Chair: Gentlemen, on behalf of the committee, thank you very much for your presentation this afternoon. Good luck.

Mr Hassan: Thank you for seeing us.

ELEMENTARY TEACHERS' FEDERATION OF ONTARIO,
THAMES VALLEY LOCAL

The Chair: Our next presentation is from the Elementary Teachers' Federation of Ontario, Thames Valley Local. If the presenter or presenters could come forward and state your name for the record, please. On behalf of the committee, welcome. It looks like we're going to give you a bit of help with the maps.

Ms Nancy McCracken: Yes, I have assistants right here. Thank you.

My name is Nancy McCracken. I'm the elected president of ETFO, Thames Valley local.

I have brought a map here to show you the scope of the school board in which I work. Thames Valley is, as you know, an amalgamated board. To give you some idea of the size, this map in my hand is the city of London, with the London schools. Of course, all those little dots don't fit on to our larger map. The top northeast corner, the furthest school from the city of London, is in Plattsville. It's about an hour and 20 minutes from the centre of the city of London, approximately the same distance to any of the four corners. The geography we're dealing with in this board is a major factor and I hope you will remember that as I discuss our issues here.

Thank you for this opportunity to present the perspective of the Elementary Teachers' Federation of Ontario, Thames Valley local, on educational funding. Our organization represents over 3,000 elementary teachers, spread across the huge geographic area of Thames Valley District School Board. The geographic size and the diversity of the communities within Thames Valley make it a good sample of the operation of the education system across the province. We have a large, densely populated urban area, the city of London, smaller towns such as St Thomas and Woodstock, villages and hamlets too numerous to mention, and large rural areas. The people who live here and whose children attend Thames Valley schools are from all spectrums of society, from recent immigrants to families who are marking their seventh or eighth generation on the same farm; from diverse ethnic communities around the globe; from every strata of socio-economic levels.

I hope this afternoon to present some of the specific problems that we as teachers see and give you examples from real schools to illustrate the point. I will not use the names of actual schools or students, but I want the committee to realize how the application of the current funding formulas has affected individual schools, teachers and students. These are not just statistics. These are real students and teachers whose lives are being affected.

Amalgamation: I'll just speak briefly again to that issue. Thames Valley District School Board was formed by four former boards, Elgin, London, Middlesex and Oxford, in January 1998. Thames Valley is the third-largest school board in the province and has about 90,000 students. Each educational system had its own processes, procedures, policies and history. Each had its own quirks and pet projects.

The trustees and administrators worked very hard in Thames Valley to make the transition seamless for students, and they have succeeded quite well. It has, however, been a different matter for employees, including the teachers, who are still seeing the fallout from amalgamation and harmonization of programs and services. For example, we've only this past September moved into a single payroll system. At this time, no personnel records from previous boards can be read by the current new personnel computer. All our information has just been amalgamated into a totally new system, which is not the same as any of the previous systems. If a teacher needs verification of employment, for example, for pension purposes, the paper records and microfiche must be searched by hand, and I understand the alternative is to send a disk to someplace in Winnipeg and have them read it.

Thames Valley employees continue to operate under former policies in many areas, creating inequities. For example, we do not have a single harassment policy or an unified wage loss replacement policy. The personnel and time have simply not been available. I do not want to lay blame for any of these things on the staff at the school board. They work very hard. In the 2001-02 school year, students will, for the first time, have equitable access to French immersion programs in all areas of Thames Valley.

The point is this that amalgamation is not over. When old systems are destroyed, a new one must be created and it takes time and money for planning and implementation while day-to-day operations must continue. The cost of amalgamation has been badly underestimated. Funding should reflect continuing costs of amalgamation for several years into the future.

While moving toward this amalgamation, the school board has been severely restricted in the manner in which it can make decisions in any area by the rigidity of the current funding formula. The school board had hundreds, likely thousands, of small decisions to make in the areas of programming, services to students, contracts with employees and the like. In all of this, as employees, as teachers, we have often found that funding announcements are made far too late, with ridiculously short timelines, creating chaos and uncertainty in areas such as staffing schools for the following year.

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You have to understand that teachers plan a year in advance for their teaching assignment. School boards must be able to plan for several years in advance for programming and services to students. The funding and the rules that accompany it must be known well in advance. As an illustration, the staffing for the 2001-02 school year begins in January. It has already begun and is in process. This past year, new funding for primary students was announced in June, which was long after schools and programs were already determined for the following year. A smaller school board might be able to move more quickly, but a system the size of Thames Valley District School Board cannot. The results of uncertainty are a demoralized workforce of teachers and a school board that is planning in an ad hoc manner, both of which are likely to result in a diminished quality of day-to-day education of students, which is the opposite of the publicly stated goal of the provincial government.

Our schools: Thames Valley District School Board is experiencing a population growth, but because funding for new schools cannot be accessed until the system reaches 100% capacity, no money for new schools is forthcoming. Empty classrooms in the southeast corner of Thames Valley -- if you will recall the map -- do not alleviate crowding in schools in the north end of the city of London, which is our largest-growing population area, nor will boundary changes accomplish anything. Many schools are well over 100% capacity, creating very difficult working and learning conditions as students are housed in portables. I'm not sure if you heard a presentation from the Thames Valley board, but I expect they would have presented the capacity numbers which have been studied every year, and we have a lot of schools that are working at 150% to 175% capacity.

As schools, especially the mid-sized and smaller schools, become more crowded with larger numbers of classes, access to the gymnasium, the library and computer labs are restricted. Special education teachers, educational assistants and special support staff, such as speech-language pathologists, are working with individual students in closets, storerooms and hallways. This is not a way to deliver an education program or make students or teachers feel valued. Funding for the construction of new schools and additions to existing schools in areas of population growth must be made available to school boards.

Our students: the complete reworking of the delivery of service and funding to special-needs students has left parents and teachers frustrated. The definitions and rules keep changing, the paperwork expands, but here is some of the classroom reality: a student whose behaviour is so uncontrollable, he was discharged from a psychiatric facility is placed in a regular classroom because there is no other place for him; a student who must be watched constantly because he is a potential danger to other students is placed in a special classroom in a regular school, a normal school, after discharge from a psychiatric facility, but he cannot be assigned an educational assistant because his problem is not severe enough. Teachers have been threatened and teachers have been assaulted. That is the reality in our schools right now.

Students are not receiving the education they need and deserve. There is a desperate need for services and places in children's psychiatric facilities and support and assessment services within our school system. Teachers are coping with up to 12 special-needs students in one classroom. How can that teacher provide quality instruction to any of the students in the class under those circumstances?

We need to increase funding for students needing specialized services, such as psychometric and psychiatric assessment and therapy, speech-language therapy, behaviour and anger management training. We need to extend the funding to allow school boards to provide more extensive in-service training for teachers working with these high-needs students.

The discrepancy between elementary and secondary pupils and teachers: first in class size, it was difficult for elementary teachers to believe the announcement of the first new educational funding model a few years ago. We all thought the press had got the numbers backwards. Surely class size aggregates for elementary students would be lower than for secondary students. But, no, the reporters were correct. The funding model mandates there shall be more three- and four-year-olds in a classroom than there can be 18- and 19-year-olds. The class size ratio which dictates the number of teachers is 21 to one for secondary students, who range in age from 14 to 19. For primary students, junior kindergarten to grade 3, the ratio is 24 to one -- that is students between the ages of three and eight; and 24.5 to one for grades 4 to 8, or students aged nine to 13, approximately.

Do our youngest students need less attention? Are the fundamentals of literacy and numeracy so much less important? Which group of students is more likely to work independently while a teacher assists an individual with a difficulty? Primary teachers have borne the brunt of increasing class sizes in elementary schools since the restructuring of educational funding. The exhaustion and frustration is evident when you speak with any of them. There are simply too many students in early years and primary classrooms.

Let me give you some examples. In Thames Valley, there are numerous junior kindergarten classes of 25 pupils; 25 three- and four-year-olds and one adult, one teacher. There is a senior kindergarten class with 27 students; that is, four- and five-year-olds. There are 12 grade 1 classes with 27 students. I would challenge any of the panel before me to invite 27 five-year-olds to your home for a day and not only keep them safe and happy but teach them new skills, assess how well each one is progressing and record your observations.

About 30% of the grade 1 classes in Thames Valley have 24 or more students in them; that is, 30% of these students are in classrooms that are over the provincial class size average. It does not improve the quality of education of those particular students to know that somewhere there are classes that are smaller than the provincial average. Twenty-seven per cent of our grade 1 students are in split-grade classrooms with both grade 1 and 2 students. That means in real terms that a teacher is planning a program for students whose skills range from barely being able to identify letters to those who are reading "chapter books" independently. Those are real children, in the most receptive learning phase of their life, and once those optimum teaching times are gone, they are gone forever. Those real children right now are being shortchanged by an inflexible class size funding model which does not equalize opportunity, but denies it. Our youngest students deserve better.

The class size average for junior and senior kindergarten and grades 1 to 3 should be reduced to 20.

In our higher grades, the picture is very similar. Every school administrator, the Thames Valley staffing system, and the teachers through their collective agreement have attempted to maintain smaller class sizes in the primary grades. By necessity, this then increases the numbers in the junior and intermediate classes in order to meet the average class size for school and system. Grade 7 and 8 classes of 30 to 33 are common in many schools. The problem of numbers can be compounded by the physical structure of the school or classroom. We have one school, built about 10 years ago in a spirit of optimism when everyone thought the trend was to smaller classes, that actually built physically small classrooms. They are well below the standard, but those classrooms now have to hold the same number of students as schools with the regular, standard-size rooms.

The class size average for students in grades 4 to 8 should be set at 21.

The foundation allocation: each elementary-aged student was allotted $3,429, while each secondary-aged student was allotted $4,094 in the March 2000 funding, a difference of $665. This difference has increased as a result of the slight lowering of the ratio. While it is understandable that the distribution of funding will be different from elementary to secondary, reflecting different teaching and learning focus, why should there be more money overall for secondary students? There has never been a satisfactory answer to that question.

The amount for textbooks and learning materials is 25% less for elementary students. Our teachers are desperate for textbooks and learning materials for their classrooms. Wholesale curriculum changes have made old texts obsolete, but there is not enough money to replace them. In a survey of Thames Valley elementary core French teachers in the 1999-2000 school year, 40% did not have enough texts for one per student.

The amount allocated for classroom supplies is $77 per elementary student and $173 per secondary student, a difference of $96. No wonder elementary teachers cannot conduct proper science experiments, schools regularly run out of paper each spring, and teachers purchase art and craft supplies from their own pocket.

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Preparation time: funding for preparation time for elementary teachers is $228 per pupil, and $479 per pupil for secondary teachers, more than double. The Education Act mandates an instructional time of at least 1,300 minutes, leaving 200 minutes available for preparation time in the standard instructional week of 1,500 minutes. The foundation grant only funds four teachers per 40 classroom teachers, which is less than 150 minutes per week. Any improvement comes out of the total teacher compensation package; in other words, elementary teachers who have negotiated more preparation time pay for the improvement themselves. It still does not approach the preparation time allotted for secondary teachers, both in the Education Act and in the funding. While our teaching assignments are vastly different and difficult to compare, there is no justification for this huge discrepancy.

Funding for preparation time for elementary teachers must increase to the legislated limit, 200 minutes per week, and should move overtime to equal that of secondary teachers.

Staffing and program: the application of the staffing formula has led directly to significant loss of program throughout Thames Valley schools. This is why staffing and program must be considered as a single issue. When the formula recognizes only classroom teachers, it makes the delivery of specialist programs almost impossible except in our largest schools. Larger schools are at a definite advantage, as they can maintain class sizes while still assigning teachers to special assignments such as music. Smaller schools have no ability to assign teachers to anything other than classrooms. Here are some examples.

Computers in our schools: the rigid formula for calculating the number of teachers leads to innumerable difficulties which are not immediately apparent to anyone who does not know how schools work. For example, there is no staffing allocation for the teacher whom we locally call the computer contact teacher. These teachers instruct other teachers on new software, troubleshoot with technical glitches, and are often responsible for the printing of report cards, among many other duties. Previously the boards allocated a number of minutes per week or per six-day cycle to allow a teacher time to perform those duties related to the computer network and the software. This is no longer possible. It is a completely voluntary position, requiring a minimum of several hours of work per week. Neither is there enough technical support at a system level, so that computer networks in schools are often down for weeks together. The results in elementary schools are that either a teacher is spending hours of volunteer time or the job isn't getting done, which means thousands of dollars of computer hardware and software is collecting dust. If we want computers in elementary schools, then the funding must be there for proper training and ongoing maintenance.

Funding must be allocated to allow time for teachers to instruct other teachers and students in computer technology. Funding for technical support staff to maintain and service computer networks must be increased.

Music: music programs in Thames Valley schools have been decimated. I can find no other word for it. There is no funding for music programs or teachers. Any music programs remaining are in the larger schools which happen, through luck, to have a qualified specialist teacher on staff. If that teacher leaves, the program may die. Smaller schools have no options. They do not have any flexibility in assigning teachers, and music instruction is left to teachers with no background or qualifications. If our goal is quality education, this is not the path to take.

The estimated loss of music programs taught by specialist teachers, many of them Kodaly-trained, is about 60%. For example, one school went from a 90% music teacher to 35%. That 35% is currently only devoted to the junior-division classrooms, grades four, five and six.

Another school completely lost its talented music specialist in 1999, when she had to be assigned to a classroom. In the previous year, 1998-99, students in that school received a minimum of 150 minutes of music instruction per six-day cycle. In 1999-2000 they had no music program overall except what classroom teachers could deliver, and in 2000-01 the music instruction has been restored through a gymnastics of timetabling to allow 50 minutes per six-day cycle for each class.

Research in music instruction has proven its value in exercising the mind and enhancing learning. Our talented students are deprived of brilliant instruction from exceptional teachers. For many of our students this may be their only exposure to music in a formal sense. How many doors are we closing for the future? Funding must be allocated to allow for music instruction by qualified music teachers.

Teacher-librarians: teacher-librarians are the heart of a good instructional program in any school. They monitor and provide resources in a variety of media, work with teachers and students to develop research-based instructional units and are truly the gatekeepers in our information age. When Thames Valley District School Board was formed, one former board did not have teacher-librarians and, to its credit, program services made a commitment to expand the teacher-librarian allocation to all schools in the valley. However, this did not balance the overall cuts to teacher-librarian positions as illustrated below, and I believe the graph speaks for itself. The Thames Valley board is currently funding more teacher-librarians than the funding formula allows. We are hoping they will continue that commitment.

Many schools have a teacher-librarian allocation of 0.3, which works out to be one and a half days per week. That's unworkable as students and teachers need access to libraries and teacher-librarians on a consistent daily basis. We need to increase the allocation for elementary teacher-librarians to allow a minimum of a half-time teacher-librarian at each school and a full-time teacher-librarian for schools of over 300 FTE students.

Design and technology: under a previous provincial government, the program integrating science and mathematics into real experiences for children was developed. It was called design and technology -- D&T in teacher talk. Children developed projects and built working models of things like airplanes or bridges, giving them opportunities to understand how the world works. For many students this type of hands-on learning is their best learning mode. Schools purchased equipment such as saws, hammers, safety glasses and materials and renovated classroom space. Teachers were assigned to this challenging and interesting program. All of that equipment is now useless. It has been removed from most of the schools. There is no design and technology program.

Professional development: with completely new curriculum, electronic report cards, new processes for individual education plans and countless other changes, teachers are desperately in need of professional development time that is not tacked on to the end of a working day.

Most people do not understand that curriculum documents from the ministry provide no lessons, materials or methodology for actual teaching. New units and lessons must be developed and planned, keeping in mind the various needs of all students, the range of academic abilities and skills, and with materials and variety that allow success for all. This is a lengthy, demanding process. More funding should be allocated at the school level to allow teachers extra preparation time on a regular basis throughout the school year for the purposes of developing curriculum expectations into teaching units and lessons. This could be in the form of extra staff allocation or more funding through the occasional teacher line.

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Teacher compensation: teachers across the province have had their first salary increase since 1993. In that time, inflation has eroded over 12% of our salaries, while private sector jobs got modest salary increases throughout that time. The result is an extremely low compensation package for teachers in comparison to other employment groups. Many young people entering the workforce for the first time with an ordinary university degree or college diploma are making as much as experienced teachers who have an honours degree and a bachelor of education. I have appended at the back the current salary grid for the Thames Valley elementary teachers.

In the current and worsening teacher shortage, the government will need to respond, just as the private sector does, with enhanced compensation for teachers. If this does not happen, the teacher shortage will become worse as young people find more lucrative employment, trained teachers go elsewhere and experienced teachers nearing the end of their careers cannot be persuaded to remain.

There is actually a disincentive for teachers to improve their own educational qualifications. Since there is no allowance or allocation for extra degree allowances such as master's degrees or doctorates, our collective agreement gives teachers a one-time payment of $500, a truly insulting amount which does not begin to address the financial cost and effort involved, let alone recognize the expertise which is now available to the school board and to our students. Compensation for teachers must increase significantly to compare with other employment sectors with similar qualifications and responsibility.

To conclude, the central difficulties with the current funding formula, from the perspective of elementary teachers, are the following:

Class size ratio must be lowered, which would achieve both smaller classes and more flexibility in programming;

Funding for textbooks and learning materials must be increased;

Funding for preparation time and professional development must increase;

The disparity between elementary and secondary funding must be eliminated;

Specialist teachers and programs must be restored; and

Teacher compensation packages must increase.

I hope the committee has the vision to see that Ontario needs a significant reinvestment in our education system. Efficiencies can only happen once. Cutbacks and restrictions in spending have mortally wounded sound educational programs in Thames Valley. Continuing attacks on teachers in public relations campaigns have demoralized the teaching staff. Quality education is not cheap. It is disgraceful that Ontario ranks 55th out of 63 in educational funding among North American provinces and states. Please have the courage to demonstrate your commitment to children and to our future.

The Chair: You've used the entire 30 minutes for your presentation. On behalf of the committee, thank you very much.

INTERFAITH SOCIAL ASSISTANCE
REFORM COALITION

The Chair: Our next presentation this afternoon is from the Interfaith Social Assistance Reform Coalition. I ask the presenters to come forward and state your names for the record. On behalf of the committee, I'd like to welcome you.

Rev Brice Balmer: I'll start the introductions. My name is Brice Balmer. I'm the secretary for the Interfaith Social Assistance Reform Coalition. I also happen to be a chaplaincy director at the House of Friendship, which is a large social service agency in Kitchener-Waterloo.

Rev Darlene Cunliffe: I am the Reverend Darlene Cunliffe and I am from Brantford, Ontario. I'm also here as a representative of the Huron Against Poverty committee, which is part of the diocese of Huron. I also coordinate a meals for the homeless program in Brantford, with the co-operation of Ontario Works.

Rev Frank O'Connor: I'm Father Frank O'Connor. I'm here representing Bishop Sherlock and the diocese of London. I teach at St Peter's Seminary in London and have worked with the different poverty groups in the city of London.

Mr Greg deGroot-Maggetti: My name is Greg deGroot-Maggetti. I'm the socio-economic concerns coordinator for Citizens for Public Justice. We're a national, non-profit ecumenical group that works to promote public justice in Canadian public affairs. I live in Kitchener, Ontario.

Rev Balmer: We're glad to be here. Greg and I are both on the ISARC board, but when we are in different communities, as you are, we like to bring people from the community who also are participants with us. ISARC is both a provincial organization and an interfaith organization. If you have our brochure, you can see at the back of it we list the different faith communities that are a part of our organization. I think you'll see the breadth of the commitment to the Interfaith Social Assistance Reform Coalition.

We have a short statement, which is in the front of your packet. I would like to read that through for you and then we'd be open to questions and discussion about some of the points we've made and some of the concerns that you also would want to raise.

The Interfaith Social Assistance Reform Coalition, or ISARC, as we're known, is concerned that we build a sustainable society for all Ontario residents. Since 1986, we as faith communities have been deeply troubled by the rising numbers of Ontario people living below the poverty line. If you look at the back of that sheet, you will find many of us have been involved in Out of the Cold, in shelters, in all kinds of programs where we have tried to work with those who are the least fortunate. We're also getting very burned out at this point because the numbers continue to increase.

We have worked with Liberal, New Democratic and Conservative provincial governments and have not seen a substantial decline in poverty since our beginning in 1986. In fact, poverty has increased. Persons in the lowest economic quintile continue to struggle with decreased incomes, higher rents, more barriers to a living wage and more barriers to employment. Though welfare rolls have decreased, homelessness, child poverty, and food bank usage have increased. We call on the Ontario government to make the reduction of child poverty, hunger and homelessness a priority.

A society is judged not by its generosity to the affluent but how it treats the poor and the vulnerable. Therefore, we urge this government to use the current surplus to meet the needs of lower-income individuals and families.

During the past 30 years there has been an increasing economic gap between the rich and poor in Ontario, and that also goes for all of Canada. This gap is creating an underclass which has little chance of competing and whose children often are severely harmed. Instead of tax cuts, we call for monies to be allocated to affordable housing, to the children's agenda and to increased monthly incomes for those on social assistance. This reduces the gap and the barriers for the lowest-income Ontario residents so that they can become employed and take responsibility for themselves and their children.

One rationale for this proposal comes from the six values that are integral to our work. These values are embedded in all of our faith traditions: safeguarding human dignity; enhancing mutual responsibility; ensuring social equity; ensuring economic equity; working toward fiscal fairness for all Ontario residents; sustaining and improving the environment -- the water, the land, the air and the other public goods which we all have and own.

Specific recommendations for Ontario's 2001-02 budget include co-operation with the federal government to provide affordable housing. As you have all seen, the provincial government cut back 17,000 units in 1995 and only 4,000 rental units have been built since 1995, so we're facing quite difficult circumstances.

Second, co-operation with the federal government on the national children's agenda: the Early Years report is a well-researched provincial initiative and local communities are very willing to work toward the Early Years report. Funding is needed for start-up and for child-parent programs, prenatal and postnatal care, and quality pre-school and child care that is affordable and accessible to all Ontario families.

Third, eliminating the national child benefit clawback for welfare recipients and other means of adequacy in social assistance payments. Families on Ontario Works and the Ontario disability support program are unable to provide basic essentials, especially with the current high rents. The federal monies would be a real increase to their incomes and provide a sense of hope, which is needed in order to take responsibility for their lives and to increase employment.

Fourth, a moratorium on further tax cuts and rebates for more affluent Ontario residents. The government should work toward fiscal fairness and decrease the social and economic gap between the wealthy and the economically disenfranchised.

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ISARC will continue to work with the provincial government; in fact, we have been meeting with some of the deputy ministers. Yesterday a number of us were at a consultation, many of us for the second time, around the mandatory addiction treatment, which used to be called mandatory drug testing, and we continue to work at that level. We're also working with the opposition parties and other coalitions. In fact, if you look at the back of this, our work is with Campaign 2000, Workfare Watch, a number of the housing groups. We're involved with a wide group of coalitions that are working with lower-income and socially and economically disenfranchised people. We wish to help frame policies that will ensure a safe community for all of us to live in. We feel that safety and health are enhanced when all people have a safe place to live, enough to eat, ability to raise their children in a good environment and access to quality jobs.

I've listed the attachments, which are backgrounders. All of you were invited to a religious leaders' forum on February 7 and the backgrounders are the ones that are appropriate to this statement, as well as ones that were passed out on February 7.

The Chair: That completes your presentation?

Rev Balmer: We were hoping we would have a good discussion with all of you rather than trying to --

The Chair: We certainly will. I just wanted to make sure you were done.

Rev Balmer: Yes.

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

Rev Balmer: Pardon me, David. Susan Eagle, who's also one of our members, is at the end of the line. Maybe Susan could identify herself.

Rev Susan Eagle: Susan Eagle, from the United Church of Canada. I live and work in London.

Mr Christopherson: I don't disagree with a lot you've said, so we're not going to get into anything we can bandy back and forth. I would hope that you'll engage the discussion with the government about the tax cuts, because it's the same argument I've been carrying for the last week and a half. We even had Jim Stanford come in and make a presentation; you may have read it. I can tell you that no one has refuted that yet. It may happen, they're working on it, but it hasn't been outright refuted -- other than John, outside of that -- his argument being that there really weren't any tax cuts anyway.

There's just no argument there to be had, and yet it's the one they pay the closest attention to. I think what you're going to hear from them, and I'm sure you're ready for it, is that they're going to give the political spin, the economic spin, that these tax cuts are what's going to generate all the dollars and that's going to be reinvested, then there are going to be jobs created and the money that's generated through tax revenue will be spent on all these good things. It makes for a wonderful speech; none of it happens.

The reality is that we've gone through the biggest economic boom we've ever seen over five years and, yes, the dollar side looks good. The chambers of commerce roll in here and they sing the praises of this government from the beginning of their half-hour to the end of it, but virtually every group that has come in here and talked about the social issues, all of the things the average person and their families run into on a day-to-day basis, is paying the price. You're here representing those who have paid the absolute greatest price, so I hope you're ready for that.

I would ask you, out of all the things that you're asking, what do you think would be number one? I've posed that to the other side and it's only fair I put it to you. If you had one area that you could see moved on immediately, what do you think would have the single biggest impact? Recognizing nothing is going to solve all the problems, what would be the number one priority and why?

Rev Eagle: They're letting me speak right now because unfortunately I have to leave shortly. You're quite correct, all the social indicators demonstrate that in spite of what the economy is doing, the poor among us are getting poorer. Tenant incomes have had a net decrease, increased waiting lists for housing etc. I would be very torn in terms of one thing I could do right now, either restoring the cuts to social assistance or dealing with housing. I suppose if you started to deal with the cuts to social assistance, you'd be restoring some of the shelter amounts that people need, but those would be two huge areas that have had the most disastrous effect on low-income people.

When the government cut the housing programs in 1995, we lost 17,000 units of housing at that time, and there have been virtually no affordable housing units built across this province, in spite of all the promises that have been made.

For the people who lost the 21.6% social assistance, what happened is that they very often lost their housing, had to move to poorer-quality housing, smaller housing. Many of them are finding they can't feed their kids at the end of the month. So it's a difficult choice, but if I could stretch your question to identify two, those would certainly be two big areas.

Rev Balmer: I want to accentuate both of those but especially the housing one, because every place where we've had safe and affordable housing that people can live in, they start to take responsibility for their lives. We've had amazing experiences. I work for a large organization called House of Friendship. When we put street people in their own housing, they went back to school, and they stopped using alcohol and drugs. In this case there weren't children involved, but in other places where we've have housing, they start to take care of their children in a more appropriate way, they start to be involved in the community. But you have to be safe -- the barrier to employment is your own safety. If you're living in chaos, it's very, very difficult for you to get out and get a job and take responsibility for yourself. But once we get people into safe, affordable housing that they know is not going to be jerked away from them, we see amazing social progress being made and people going back to school and getting jobs.

Mr Christopherson: One of the things the government, unfortunately, has been effective in doing is to demonize the poor, my word, basically leaving the impression with the vast majority of voters -- I'm going to say "voters" because in the power play of this place, that's what matters. In the minds of a lot of voters, they've bought into this. I think for those of us who want to turn things around, one of the keys is going to be reaching the average working, middle class, where the bulk of people and their families are.

How best do you think we should be doing that? How do we re-educate people that people aren't poor because they choose to be? Little kids don't say, "When I grow up I don't want to be a police officer or firefighter. No, I want to be poor." This doesn't happen, and yet somehow, we seem to be at that point. What's your sense of how we begin to turn that around, aside from the value of your coming forward here, which I thank you for doing?

Father O'Connor: I would think that one of the crucial things that particularly this government should do is to appeal to what's best in us. That's crucial because, unfortunately, I think many times what's happened is that the appeal has been to what's most base in us -- in a sense, our greed. If we can look at the importance of the social fabric of our society -- I think we can see it in health care, I think we can see it in education, I think we can see it in housing and, above all, in social assistance. If we look on people as commodities and things and lose the perspective of the dignity of each human person, then we make the ultimate criteria the economic criteria rather than seeing that economics needs to be put in human values and moral values.

What do I think the great transformation is? I think the legislators and the teaching they give us as a basis of the principles that they use to make their decisions have to be principles that really have solid, human, moral values that are going to raise up the dignity of people and also appeal to what's best in us.

Mr Christopherson: Thank you all for coming today.

Mr Arnott: Thank you very much for making your presentation today. Mr Christopherson has indicated what I'm going to say already, but I think I would like to add to some degree to what he said.

First of all, I want to say that we don't doubt your sincerity and your desire to improve the lives of people in our communities. I'm privileged to represent the riding of Waterloo-Wellington and I actually represent a fairly big part of the city of Kitchener, in the Laurentian Hills area, the Country Hills and part of the Pioneer Park neighbourhood, so I am very interested in what is happening, obviously, in the city of Kitchener with respect to the issues you've talked about.

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I guess I would take you back to 1995 when we were elected to form a government. You may recall that the provincial deficit -- the cost overrun, if you want to call it that -- was about $11 billion per year. We were spending $1 million an hour more than we were taking in. The unemployment rate was unacceptably high. The numbers of people on social assistance were unacceptably high as well. We were trying to encourage job creation, and we had a plan and we put it to the people quite directly as to what we would hope to achieve in terms of our goals, and we were supported and elected.

The decisions we've had to make in government in terms of reducing spending have not been easy, and we've tried to do it as sensitively as possible. Certainly that's the subject of some considerable political debate, but we have tried to accomplish the goals that we set out for ourselves and improve the lives of people in the province. We have encouraged the creation of about 800,000 new jobs, and that is a significant accomplishment, I would argue. That's not to say we can rest on our laurels; we have to do more. I think that those people who now are working who weren't working before are much better off in every respect.

You've talked about six values that sustain your work and your beliefs and I wouldn't disagree with any of them, but I would also add that I certainly believe that there is merit in encouraging individual responsibility and in encouraging self-reliance in our people and that we need to also support those who are unable to support themselves. That has to be part of our fundamental value set.

We are in a position now to look at where we're moving forward from here. We've got at least two years to go in our mandate, and we are interested in hearing what the views of the people of Ontario are as we move forward. We do appreciate the advice that you've given us. Thank you very much for making the trip to London, some of you, to present to us today.

Rev Balmer: Some of us would ask the question, the wealthy in the Waterloo region, where you are and where I live -- we're 5% greater in terms of the growing gap between the rich and the poor. At the House of Friendship where I work, as you well know, we have not decreased our service. In fact, we have more food hampers going up from the Waterloo region, we have more people in shelters. The Out of the Cold program has doubled in the last year; ending in April until it started on November 1, we doubled. What's happening is that there are more and more women, and we're afraid that children are going to follow very quickly. They do come for supper; they don't stay overnight.

It's the moral and ethical question that we have to raise. We can't deal with the economics, but there is a moral and ethical failure in terms of not being able to address this issue. I don't want to just put it on your government, because ISARC started in 1986 and we at House of Friendship and the other churches thought we were into this thing on a short-term basis to help the lowest and the most needy and to try to figure out how to do that. But we have not yet had places where people have helped us with housing, with food, with -- you say jobs, but you have to take a person for a while before you get him to a job. If it's short-term poverty, we can get a person into a job really, really quickly; if it's long-term poverty, we have a big problem.

My question is, in terms of the moral and ethical dimension, when are we as political parties and government of Ontario, as well as Canada, going to start to take a look at why people are poor, why they stay poor and why the poverty figures don't go down? What do we see? Everybody's been lauding Nortel. Look what Nortel got us over the past week. Is that where we want to put our money? Many of us do with our RRSPs. Some of us are asking the question -- there is a moral and ethical issue here; it's not just a political issue -- how do you take care of the people who most need assistance and how do we all do that, and how do we create a community that does it, rather than tear our community apart?

The Vice-Chair: We have about a minute and a half left.

Mr O'Toole: At the risk of sounding like I'm lecturing you -- I am listening, but I do want to somehow legitimize my own situation. I consider myself a person of faith and conscience. I believe there are differences around this table in the approach to the solutions. I commend your community working together. It's going to take more of that, rather than more money in many cases. I do espouse to the teach-a-person-to-fish idea as opposed to giving them a fish.

I just want to go back to some of the fundamental premises where we all get off the track. The short-term solution of writing the cheque is no longer a solution at all. It's the politics. What you're talking about is a longer-term economic change in focus: the sharing and distribution of wealth, which is primarily a fiscal and tax policy. I believe what we're doing, and this is why I can with conscience and faith stand up and not disagree with you except on the approach. I fundamentally believe the simplest analogy is that you must have the strong economy first before you can deliver the house or the goods or the food.

Now, if you don't espouse that, I put to you the model is, in the vacuum of that, building capital infrastructure, you don't have the ability to redistribute wealth. So it's a very simplified premise, with the 90 seconds that I've got -- maybe you'll get time to respond -- but if we can't agree on that, then where does the fish come from without the silos and all of the bureaucrats in the offices? By the time program delivery gets down, there's about 12% in program; in every budget, it's 80% or 90% wages.

The Vice-Chair: We're going to have to move on. I gave you more time than the party was really allocated. We move on to the official opposition. Mr Hoy.

Mr deGroot-Maggetti: Do we get to respond to you?

The Vice-Chair: He used up all his time. Respond to him when you get the opportunity here. Sorry.

Mr Hoy: I appreciate your being here this afternoon, and I noticed your hand up a few minutes ago. How much time do I have, Chair?

The Vice-Chair: Six minutes.

Mr Hoy: OK. You'll have some time to speak, most assuredly.

One of the most disturbing things for me when I became an MPP, other than health-related issues, was the fact that people came to me and were just devastated that they would never own a home, and I appreciate your comment on safety. Now, it might have been that those people had a dwelling, but they didn't own it, and they said to me, "I will never have a home." They didn't care about a car and some other things in life, but they really wanted a home. So I appreciate your comment.

You would like to respond, I believe, to the other side. If you'd like to, you could.

Mr deGroot-Maggetti: Just to respond to some of the statements that were made.

Mr Arnott, you said that all those people who have jobs now are better off than they were, but when we look beyond the averages and the statistics and things like that, it turns out that actually the majority of working families are no better off now than they were in 1989. The situation hasn't actually gotten better.

The Vanier Institute of the Family released their latest profile of family incomes. It turns out that families are working harder just to not even reach where we were in 1989. So we need to take a look at reality. Are we really better off? If we look at the growing number of working people who are showing up in food banks, it should cause us to question, really deeply, is just having a job making you better off? For a lot of people, it's not.

We need to take a deeper look at some of the economic assumptions that we make. The assumption that economy comes first and then you can pick up the pieces afterwards has actually come under increasing questioning among professional economists. The concept is called "social capital." There has been a growing awareness as industrialized countries over the past 25 years have substantially eroded a lot of the social capital; they're finding out that the base for a strong economy -- and I think you would agree; I read it in government documents and things like that -- is the human beings. It's the people of this province who will create a strong economy.

Now, if we have children whose parents can't feed them, because either they can't get by on minimum wage jobs because minimum wages haven't been raised, or they can't even find basic shelter for themselves, this is not only an abuse of these children but it's a long-term loss for our economy. So the long-term legacy of cutting back so deeply is going to come back to us in higher health care costs, in a whole range of other social costs. We really need to take a close look at that, and I would suggest you pursue some of the work of economists that are pointing out the deep connection between investing in social capital and a strong economy.

There's one other point I'd like to make. I've heard time and time again about the huge deficit that you entered into office having to deal with, and of course we hear the same thing from the federal Liberals about your federal counterparts, the federal Progressive Conservatives, that they left them with a huge debt and deficit problem. Provincial governments can sometimes confuse what their economic role and responsibility can be and assume they have a much large impact on the macroeconomy than they actually do. In my judgment, the previous government had the same misperception, for the primary reason that a provincial government does not control monetary policy.

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Professor Peter Howitt, who at the time, in the early 1990s, taught at the University of Western Ontario and was a staunch advocate of the Bank of Canada's zero inflation policy, pointed out in an essay written for the C.D. Howe Institute, in a footnote, that if the central bank, the Bank of Canada, pursued that policy, it would create severe fiscal problems for provinces. Lo and behold, he was correct. That's where that debt and deficit problem came from. Part of it was spending that resulted from the deep recession that Canada was plunged into.

I would just caution that we make more realistic assumptions about the roles and responsibilities of different levels of government. The provincial government has a very strong responsibility in a lot of the social areas to make sure that the social infrastructure, the social fabric, is knit strong, that I can rely on my neighbours, that my taxes assure that all the children in my neighbourhood can have access to good family resource centres, child care and early childhood development, which your government has endorsed in the Early Years report.

But it's not just a matter of people being there, because people also need to pay the rent or the mortgage; the grocery store needs to get paid in money. So we can't just rely on people volunteering more and more and more; they have to be paid. What sense does it make to have more and more people showing up at food banks and having our grocery stores donate extra food and get a tax break, instead of raising the minimum wage so people can go and buy food at the grocery store, can eat at the local restaurant, can give a boost to the local economy?

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

I have a couple of short announcements. The bus will be leaving for Toronto at 6:30. The bus will arrive at 6:15, so let's be on time. The bus will also stop at the airport for those people who have vehicles at the airport. So, whoever is getting off at the airport, please leave your luggage at the back to facilitate the process of this in Toronto.

ONTARIO BUSINESS NETWORK

The Chair: Our next presentation is from the Ontario Business Network. I would ask the presenter or presenters to come forward and state their names for the record. On behalf of the committee, welcome. Go ahead, gentlemen.

Mr Bill Ross: Good afternoon. My name is Bill Ross. I'm with Michael Vanpelt. We represent the Ontario Business Network.

In January 2001, Mike Harris announced the PC government would embark on the third stage of the Common Sense Revolution. For the Ontario Business Network, this announcement could not come soon enough.

We are an organization reflective of a large core constituency loyal to Mr Harris's vision. This constituency has watched in angst as an aimless, reactive second-term government drifted away from its original principles. To us, Mr Harris's announcement is a welcome clarion that the government intends to refocus, return to key planks and, most importantly, attack our accumulated debt in earnest.

When we founded the Ontario Business Network our stated goal was to help elect a fiscally responsible, pro-business, balanced government. After researching Ontario's three main parties, we embraced the PCs and their philosophies.

From 1993-95, meeting regularly with Dianne Cunningham and her colleagues, we helped provide background and vetting for proposed party policies. In 1995, we devoted inordinate time and resources to elect Mike Harris and his Common Sense Revolution.

We printed and distributed the Real Story of Ontario, copies of which we have here, and Mike will pass them around just by way of introduction to let you know where we, as a small business group, felt Ontario was in 1993. There is a lot of emotion in that document, by the way.

We canvassed, raised funds, identified candidates, staged radio and television events, held press conferences and organized information seminars. One such seminar, held in February 1995 and featuring Catherine Swift of the CFIB, was credited by her in a post-election Financial Post interview as being the genesis of a public awakening to the deleterious impact of debts and deficits.

To promote the need for labour change, I appeared on televised debates with CAW's Buzz Hargrove, while other OBN members arranged photo opportunities for Mr Harris at small manufacturing facilities, thus affording the press first-hand exposure to the job-killing effects of Bill 40.

At public meetings, Mr Harris championed the need for a government revolution while attacking the powers of vested interests. Whenever possible, he proclaimed that Ontario did not have a revenue problem; it had a spending problem.

With his election, Ontario was reinvigorated. He implemented change with an unwavering belief of one truly convinced his vision was right. Not to act would have been reprehensible.

With the advent of a Harris government, the Ontario Business Network looked to disband, and I personally wanted to play more golf. However, the newly elected provincial government continued to beckon, and the network stayed involved, up to and including today.

During the first term, we provided Minister Witmer with countless empirical justifications for repealing Bill 40. In spite of her pledged commitment to do otherwise, Bill 7 fell short of complete repeal, an ominous precursor of future missed opportunities for improving Ontario's labour environment. Michael will elaborate on this later.

Commencing in the second term, stagnation began to settle around the government. The second term has been plagued by a sense of complacency and increasing paralysis. Ministries are less approachable, more absorbed in political correctness and concern for avoiding controversial public issues which could mar their minister's political future.

Gone is the adherence to the unofficial government mantra, oft repeated by my friend Frank Sheehan, chair of the Red Tape Commission, "If it's right, do it." It also makes for good politics.

I will cite one first-hand example of this ministerial paralysis. As a board member of a local charity, I participated in an initiative to establish a computer learning program serving over 200 economically challenged children. The objective was to provide equal opportunity for them in the interconnected computer world. Funds were raised, new computers bought and volunteer elementary teachers offered their time. All we lacked was software licensed to the Ministry of Education. A wonderful potential public relations opportunity botched.

My initial correspondence appealing for co-operation was ignored. Only after repeated attempts and intervention by various government MPPs did we get a perfunctory reply lauding the program's intent but dismissively rebuffing our request, on legal advice. Further attempts throughout 2000 bore no progress. Finally, circumventing the ministry, we were able to acquire the programs with the assistance of a local education administrator. Despite the ministry's reticence to assist, we now have a project recognized as prime for the Premier's Ontario's Promise initiative.

The above is one example of the malaise infecting the government. I can cite others, I assure you, but I won't. It is in this environment that Mr Flaherty must sculpt a budget that is bold and imaginative yet make an unequivocal attack on our debt.

Reviewing the government's financial statements in preparation for this presentation, I was struck by the plateauing of both the debt and our interest payments, as well as a discernable upswing in government spending. We cannot continue to spend nearly $10 billion to service the official published government debt, a debt which does not include Ontario Hydro or the unfunded liability of WSIB. Without a dramatic debt reduction strategy, future investment in Ontario will be vulnerable, as major investment competitors -- Alberta and the US, to name two -- have either fully eliminated or dramatically reduced their debts.

Mr Flaherty, for whom I have great respect, has a daunting challenge but also a significant opportunity. By making meaningful spending efficiencies his hallmark, he can reawaken his ministerial colleagues to a common objective. To succeed, he will need to challenge them to abandon their parochial and protective mindsets and to reinvent their ministries.

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The government cannot count on expanded revenues to decrease debt. Meaningful spending reduction must be accomplished. New approaches to ministerial management must be adopted, particularly at the two largest-spending ministries, education and health.

Education: where private sector competition for Earl Manners's monopoly must be considered as a bona fide option and where expropriating union negotiations from local school boards should be a priority. This is essential, given that salaries comprise 80% of all education expenditures and many existing boards lack the tenacity or philosophical ardour needed for effective union negotiations.

My understanding is the government's entire $5-billion spending increase is attributable to the Ministry of Health. Every critic will tell you this is a complex arena. This should not deter radical change, for the status quo is a recipe for a funding explosion which will undermine our objective to eliminate the debt while cutting taxes.

To this point, this presentation has focused on what the Ontario Business Network is, what its relationship with the government has been and what concerns it harbours re the province's future finances. I would now like to shift your attention to the second main tenet of our mandate: improving Ontario's archaic labour relations environment.

Having just spent the past year working with Frank Sheehan to draft meaningful labour change and producing what we felt was a well-researched, balanced, progressive document only to have it emasculated and rendered unrecognizable by a minister so preoccupied by the threat of a province-wide strike -- a hollow threat made by desperate union leaders -- I vowed never to participate in such a process again. Bills 69, 139 and 147 are merely bandages upon duct tape upon bandages. If we are to effect true change in an area critical to our long-term economic health, we must entertain a different approach.

Mike Vanpelt, president of the Work Research Foundation, a public policy think tank, feels he has just such an approach and asks your indulgence while he elaborates.

Mr Mike Vanpelt: Thank you, members of the committee, for the opportunity to speak. The Work Research Foundation is a non-partisan, independent think tank, and I will keep my remarks within a public policy orientation, not a political orientation.

There are what we see as two fundamental characteristics that form or inform the research that the Work Research Foundation is doing and has done on labour relations. Number one is that the principle of freedom of association is a fundamental freedom within the institution of unions here in Ontario, in Canada and in all of North America. Number two is that the process of collective bargaining is not necessarily, as generally thought in North America based on our present model, an adversarial process.

If we look at the public policy that we're dealing with here, especially here in Ontario, it's a dramatically polarized public policy. On the one side you have a view that employers need to be viewed with suspicion. I quote Buzz Hargrove in a recent article, his comment on being kicked out of the CLC, which was a fascinating initiative on his part, still noting that the interests of the corporation are fundamentally different than the interests of the employee. So you have that one side of the public policy discussion. On the other side of the public policy discussion you have many right-wing players, many of those being in business, who are intent on doing whatever it takes to break the union wherever they can and as dramatically as they can.

Quite frankly, our sense is and the research that we have done suggests that there are alternative ways of doing that. I want to point out two key aspects that might be suggestive for governments, business and labour to consider when viewing an alternative approach to labour relations, one that doesn't undermine the institution of the union or of collective bargaining, and at the same time encourages flourishing markets and entrepreneurship.

The first issue is union monopolies. The challenge we face in Ontario -- and I want to use the construction industry as an example. The construction industry is essentially fraught with union monopoly. If we pick up other models in our business experience, we know nearly intuitively, we know nearly by self-evident principle, that monopolies are troublesome concepts in terms of business activity. The telecommunications industry is one excellent example where removing a monopoly has created increased business activity, higher levels of productivity, the ability and the interest to integrate technology into change and into business operations. That same principle needs to be given consideration in the legislative frameworks and the culture that we have with respect to our unions here in Ontario, and especially in the construction industry. When we are prepared to review and to in effect eliminate this kind of monopoly, our sense is that we will have a much more conducive public policy environment where unions can actively compete among each other, can actively provide representation and service to their members.

There's a whole concept of worker choice and freedom of association behind this issue of union monopolies. There are many other examples besides the construction industry that have a union monopoly. The building trades council is probably one of the most pronounced and well-known examples of that.

The second issue I want to point out is for government, business and unions to give consideration to allowing more than one form of unionism in Ontario. In most of our legislative environments in Ontario and also right across the country, again specifically with the construction industry, we support and we have built in recognition of craft-style unions, where your union follows the craft that has historically been built. It is time for governments, business and labour to consider allowing alternative forms of unions, including wall-to-wall style unions. This is done in other jurisdictions, including Europe. It provides the kind of innovation that businesses will need to manage technology, to manage higher levels of productivity.

I come from Sarnia -- I was formerly the general manager of the chamber there -- and it's a perfect example, a petrochemical industry that needs an alternative form of unionism other than the craft-style union. That would eliminate numerous jurisdictional disputes. It would have a whole different approach to productivity. Already some of the unions are looking at this as an option, including the labourers' union, including the CEP, for example. However, they are being stymied by legislative environments that prevent that and they're also being stymied by a culture that prevents that.

So those are two practical policy ideas that we think will fundamentally change labour relations without forcing the kind of adversarial environment that we seem to have such joy in encouraging.

Those are my remarks, and hopefully they're helpful.

The Chair: Does that complete your presentation?

Mr Ross: Yes, it does. I just had a concluding remark. I wanted to remind members of the committee that we appeal to you on debt reduction and for ongoing labour relations improvements. This appeal comes from a volunteer organization. We've not only talked the talk but we've walked the walk, and we continue to do so. On that, we thank you for your time.

The Chair: Thank you very much. We have approximately four minutes per caucus.

Mr Galt: Thank you for your presentation. It's interesting. We've now come across somebody who is further to the right than Frank Sheehan. I wasn't sure that was quite possible.

I get accused of going both ways. I think in terms of, if somebody is in trouble, I'd like to be the first there to help. But when I find out the budget isn't balanced and we're spending far more and we have almost $10 billion that we're paying in interest, I go awfully hard to the right, maybe to the right of Frank Sheehan; I'm not sure. But I get very, very concerned about spending more than we're taking in.

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I thank you for your support and some of your kind words. I could use your kind of work in Northumberland, come the next election; it would be helpful. With your attack on the debt you were right on, and we certainly heard that earlier today, but I want to hear your response. I want to have you respond to the group that was ahead of you. You heard some of their presentation, I expect.

Mr Ross: A little bit.

Mr Galt: I want you to respond to the group that's coming after you, which is the Lambton Kent District School Board. It will probably have a similar message. I'm of the strong belief that if you want to present to any of the standing committees of the government, you should have to stay for half a day and listen to the other presentations as well. But I'd just like you to respond for a few minutes on the Interfaith Social Assistance Reform Coalition, how you would answer them when you're supporting our government, and then how you would answer the educators. You almost did earlier in your presentation.

Mr Ross: Yes.

Mr Galt: I'd love to hear your response. You get into this chair and you respond to them as a legislator.

Mr Ross: I'd like to preface my remarks for all of the committee so that they understand -- you mentioned right-wing. I'm strong on fiscal prudence and paying our way, so I come across that way. I've also organized groups that have won environmental awards, and continue to be a tree planter. I am a past chair of the Boys and Girls Club. So I'm very careful about labelling people, because in certain areas you're impassioned about them; in other areas, you're equally impassioned, but they don't necessarily fit a particular historic mould.

The social groups you talk about, addressing them, I have met with many of them and I deal with them in that context. Quite frankly, they have a difficult time challenging what we put forward when we talk to them. There is never enough money to satisfy them. I can tell you that I knew some of the people here. It is correct, we do have these needs within our society. We have these children that I talk about. Our group at the Boys and Girls Club, if I can use that as an example -- we have one of the best boards in London and most of them are small business people. Some of them are retired individuals. Some of them are young people. These people devote an inordinate amount of time to taking care of this social need.

We are developing programs that are precedent-setting in North America, like the computer program. There isn't a nickel of government money asked for that. We find ways to take volunteer time and create the financial wherewithal. We do not go to city councils seeking extra funding; we do not go to the provincial government. We take advantage of grants that are there. If you are prepared to appropriately go, put your case together, I don't care what social agency it is, you still have to do it on some kind of responsible basis, because the people you're appealing to hear these things constantly. They want to know what the value is. It doesn't matter whether it's a social value or an economic value, they want to know some accountability and some return. I can't see, for the life of me, what is wrong with that. There's only so many dollars to go around.

We're in a position in London right now where we are trying to collapse I would say at least half of the existing non-profit, non-charitable organizations. Why? Because many of them are created simply to employ individuals who are the sole employee of these organizations. They take away resources from the children and the social needs. We can take those, consolidate those, wipe out millions of dollars in administration. Your government could take $25 million out of the system in social services because you've got a whole infrastructure there that simply passes money to organizations like ourselves and others and creates no value to the end user. We could give you millions of dollars and still you could cut your budget if you looked at a different model and did it more effectively. It's there.

We have given submissions to the government, to Mrs Cunningham, to anybody who would listen on this. She's a friend of mine. We are going hat and glove, like these people do, to get more money and always telling people, "If you give us money" -- but we show them the value of what we can do. We take them, we show them the kids, we show them the accountability. Plus we can operate our overheads on less than 4% of our operations.

We ask any charity-giving body to examine that. We'd say, "We'll put it up against efficiencies and so forth," and they don't get this. They just think that this money is a non-accountable, endless thing. It always leads to overspending, underutilization, and you don't get the maximum. Consequently, we're always screaming because we have a shortage because we don't do it right in the first place.

The Chair: Thank you. The official opposition.

Mr Kwinter: I want to just say to Mr Vanpelt, I looked at your presentation and I have no serious problem with it. The reason I say that is that I'm sure all of our comments are going to be directed to your colleague, so I didn't want you to think that we were ignoring you.

I find your presentation interesting and repugnant -- I really do. This is a committee and it is made up of non-partisan people. If you want to make your pitch, go to the Progressive Conservative convention and tell them what you've done for them. But to come here and say what a great job you've done for the Conservative Party and how you were working for them and you ran ads for them and you did all of those things and, as a result, you feel you should be listened to -- and you have every right to be listened to as a citizen. But what I find repugnant, and this is something I've observed over the last several years the government has been in power, is that everybody else is a vested interest group, but you're not. You, of course, are on the side of the angels so you're not a vested interested group, but everybody else is.

You are a vested interest group. You are representing a particular segment of our society, and you have every right to be a vested interest group, but to categorize everybody else as if, "Well, they're a vested interest group" -- I have a vested interest in what goes on. Every single individual in Ontario has some vested interest: they want to be able to survive, they want their children to survive, they want to be able to do all of these various things, so they have an interest. But to label them, "You're a vested interest group so, as a result, something is wrong with you," I really object to.

We've heard pitches that you've made. I don't know whether I've told you, but to this day, Bill Davis, whenever I meet him, if I'm ever on a platform with him, will always say, "Monte Kwinter is more conservative than anybody I ever had in my cabinet." I don't deny that. I am a fiscal conservative, but I also feel that I have a responsibility.

You now are taking the government to task because they've lost their moral compass or whatever it is that they've lost in the second term. You have to understand that under our system -- which is not proportional government; it's first past the post -- you can form the government, as this government has, with about 40% of the vote. The minute you form the government, this is not a government of the Conservative Party, it is the government of the people of Ontario. There are 60% of the people who did not support this government -- and that doesn't matter, that's the way our system works -- but the government has a responsibility to deal with 100% of the people, not just the 40% who supported them, and that is the problem.

What is happening is that -- and I give the government credit in many ways -- they are addressing the concerns of those other 60%. You have to understand, they are all taxpayers. It's one thing to say, "How dare you ask for something when we, the 40%, are the ones who are creating all of the economic activity?" But that 60% are paying their taxes and they have every right to demand certain things from their government.

I hate to get on this harangue --

The Chair: You have 30 seconds, Mr Kwinter.

Mr Kwinter: -- because it's not normally a thing that I do, but when I read this, I just get infuriated because it really doesn't go to the core of what we in government have to deal with. We can't just discount the concerns of some of the citizens of this province.

You're right when you say -- and I used this quote the other day -- "Whenever possible, Mike Harris would say, `We don't have a revenue problem, it's a spending problem.'" Let me tell you, we are coming into an era where it is going to be a very serious revenue problem, because under our system there are fixed allocations that you can't tamper with. If you know anything about government, you'll know that. All you can do is nibble on the edges. You're the Treasurer of Ontario, and before you even start, you have commitments under contracts, under school boards, under hospitals and everything else, where that money is gone. Whether you like it or not it's gone, and you have a very narrow band that you can actually have some influence on.

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The Chair: With that, Mr Kwinter, we've gone over time and I have to go to Mr Christopherson.

Mr Christopherson: I won't try and top Monte in terms of expression of disagreement with much of --

Mr O'Toole: Monte's rant.

Mr Christopherson: Are you done?

The Chair: One conversation at a time, please. Mr Christopherson has the floor.

Mr Christopherson: Thank you, Chair.

I want to perhaps turn to Mr Vanpelt's document here. What I heard was the opening shot of a war that's going to have to be mounted to save and preserve the Rand formula. Perhaps you can either dispel me of that belief or confirm it, but that's what it sounded like to me. I want to tell you that any attempt by this government to fundamentally alter the Rand formula, and again if you know your labour history about how it came to be, the action and reaction we saw in society that the Rand formula solved would be matched or surpassed, especially since there's a great deal of fatigue, and I would say that in contrast to Mr Ross's opinion, to the Harris agenda. But I want to try to be fair and give you an opportunity to respond to that. Tell me I'm wrong; I'd love to hear that.

Mr Vanpelt: I'm not sure it's just a wrong-or-right issue. Let's imagine the Rand staying as it is and let's look at the construction provisions in the Labour Relations Act. There are a number of things not even dealing with the issue of the Rand that can fundamentally encourage union diversity and plurality. Your logic is going a little bit further than what is necessary to actually look at providing union diversity and creating an environment where there isn't a monopoly.

The Labour Relations Act, as you know, gives bargaining rights under its construction provisions to the building trades council, a group of unions, and right now I know the labourers have challenged that concept. Basically no other unions, including CAW or CEP or many of the other unions, can access that whole area of work. A good example where that has become a strong difficulty is in Sarnia. I know Dow Chemical had negotiated with CEP to work on an ICI project and the challenges they had to go through to make that happen, and in the end it didn't happen. So there are provisions within our own Labour Relations Act not even getting to that fundamental that you noted with the Rand formula that will create the kind of diversity that is necessary.

Mr Christopherson: What is this diversity and what's it necessary for? I'm not getting that picture.

Mr Vanpelt: Any ICI project right now in Sarnia of any size can only be done by the BTC, period, because they have a monopoly on that work, as you very well know. There are a lot more unions than the 17 --

Mr Christopherson: Is it your hope that you would have a contract that has lower wages or benefits? Where's the business interest in this? Where are you losing in the equation that you're trying to get back other than, it seems to me, if you've got this internal competition, that you would have the ability to cherry-pick those collective agreements that cost you less, which is understandable, but certainly at a loss to those workers who currently don't have to face that?

Mr Vanpelt: I think what you have to do is look at both the interest of the employer and of the employee. There are many employees who want to access that work. What you do is you create better unions; you create fewer jurisdictional disputes. If, for example, we would reconsider how the Labour Relations Act is designed with its construction provisions, number one, on the monopoly side of it -- and there are many unions that would support that notion. There might be 17 in Ontario that wouldn't, but the CAW would be first in line, the Steelworkers would be second in line and the CEP would be third in line. The suggestion that we're looking for a war, that's not at all the case from my analysis of it.

The other issue is with respect to craft-style unions. As you know, in the construction industry the BTC are all craft-style unions. That is becoming increasingly a challenge in terms of the operation of projects on-site, front-line-type operations, the ability to allow these different crafts to work together. Where, for example, a wall-to-wall-style union allows the kind of flexibility between labourers, pipefitters, electricians and that kind of thing, that's more natural to an environment where technology is becoming much more important, where productivity is becoming much more important and where you have less adversarial environments. You don't have to have all those jurisdictions --

Mr Christopherson: I'm sorry. At the end of the day it just sounds like union-busting, or at the very least gutting collective agreements, and that's my concern.

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

LAMBTON KENT DISTRICT
SCHOOL BOARD

The Chair: Our next presentation is from the Lambton Kent District School Board. I would ask the presenter to come forward and state his name for the record. On behalf of the committee, welcome.

Mr Jamie Armstrong: Good afternoon, Chairperson and panel members. I'd like to thank you for giving me this opportunity to speak to you on behalf of the Lambton Kent District School Board. I would like to take a moment to start off with an introduction of my family's involvement in education, take a few moments to congratulate the government on some of its education reforms and then briefly outline a few shortfalls in the student-focused funding formula that need to be addressed, particularly dealing with energy costs.

My great-great-grandfather settled at lot 32, concession 6, Euphemia township in 1848. He is said to have been the first licensed school teacher in Kent county. He taught school in a one-room schoolhouse for over 30 years. My great-uncle Charles was the secretary-treasurer of the local schoolhouse for many years. My mother was a schoolteacher, my sister still is a schoolteacher and my father was the secretary-treasurer of the school board when Euphemia Central school was built in 1965. Now I am a newly elected trustee for the Lambton Kent District School Board. Vickie, my wife, and I have four children who are currently enrolled in the public school system, with another child who will begin shortly. It was when this school board chose to close Euphemia Central school that I felt I needed to get involved to ensure a sound learning environment was being provided to our children as well as to all children in the Lambton-Kent district.

Some of the education reforms this government has implemented have certainly improved the quality of education as well as helped to improve accountability. The standardization of curriculum has made it easier for parents and students alike to compare what they are being taught. The new report cards are easier to read. The school board amalgamations have greatly reduced administration costs, but whether it has gone far enough is debatable. The code of conduct will help to keep our schools safe and help to give guidelines to all schools when it comes to discipline.

Today I am here to request a few changes to the student-focused funding formula. The student-focused funding formula is a great way to fund education as long as the board involved has increasing or stabilized enrolment. This year, with the unexpected huge increases in fuel and energy costs, boards with declining enrolment will be hard-pressed to make budgets work.

As you can see with graph 1, out of 71 school boards, there are seven that will receive more than a 1% decrease in funding dollars, while natural gas prices, fuel prices and transportation costs are all escalating out of anyone's control.

Table 1 depicts the funding that our board receives for transportation. As you can see, the dollars keep going down, yet the distance the buses are travelling remain relatively the same while the cost of fuel and maintenance keeps going up. Some form of stabilized funding needs to be introduced to recognize that buses generally have to travel the same distances even though they may be carrying fewer students due to declining enrolment. Another point to add to this is that in order to decrease excess pupil spaces, more busing is now being required on an already overextended transportation budget.

Table 2 depicts the price of natural gas in various areas of Lambton-Kent, and while some of the schools are locked into consortium pricing, some are not. Our business superintendent, Ron Andrechow, estimates our natural gas costs for heating purposes will increase $500,000 this year.

Table 3 indicates the increased usage and pricing that has occurred at two of our larger schools this year. At LCCVI, that increased cost of gas is 46%.

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Other funding pressures are incurred because of declining enrolment. Declining enrolment presents many challenges that are not addressed by the new student funding formula. The board has many costs which do not decline at the same rate as enrolment: Internet line feed costs, transportation costs, telephone costs etc; increased snow removal costs as a result of the heavy snowfall this winter, including removal of snow from the roofs of schools.

Funding allocations for prep time currently do not reflect contract conditions.

Other funding pressures: the school renewal funding is insufficient to meet the needs of our board, with so many older schools. Growing boards have a much newer stock of school facilities and therefore have the advantage of providing their students with the best classroom environment and learning conditions.

To close, I would just like to comment that the education reforms for the most part are having a positive effect on education. After years of being unaccountable to their stakeholders, school boards are now being looked at a lot closer. Student and teacher testing will be giving parents evidence of what kind of education their board is providing to their children. However, Rome was not built in a day, and the shortfalls in funding that are occurring in boards that are suffering from declining enrolment, coupled with escalating energy costs, is an area that needs to be addressed.

That concludes my presentation.

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

Mr Hoy: Thank you for your presentation this afternoon.

One comment I've received from teachers about the new report cards is that they feel there isn't enough flexibility in them to do justice to certain students; there isn't a wide enough range. But on standardizing report cards, I have no great opposition to it. I have no opposition to it, other than the comment that some teachers have made to me in that regard.

Much of your presentation has to do with fuel costs, whether it's in the school or on the road, busing. I have heard from hospitals that the same situation is occurring. We have a particularly cold winter as compared to some in recent years, and other industries are having the same problem; greenhouse, for example. I was talking to some people the other day. They're spending $20,000 a day for their greenhouse operation. They're also having problems with a lack of sunshine, which can generate and maintain some of that heat during the daylight hours.

You have significant cost increases, to say the very least. How is your board coping with this now and how do you propose that the government help you immediately here?

Mr Armstrong: Student-focused funding is always done a year in advance, and unfortunately there's no way that even the government can predict that the energy costs are going to escalate the way that they have. I'm suggesting some sort of formula so that as the energy costs go up, so do the allocations for the energy funds. That's basically where I stand on that, I guess.

Mr Hoy: You would like to see that put in place at the beginning of the school year so that with any event that might have any utility go up, it would kick in somehow.

Mr Armstrong: Yes, like a particularly cold winter. This year was abnormal, the cold weather that we had, so the usage is up as well as a very significant increase in the price.

Mr Hoy: So that would have to deal also with the transportation side: if gasoline or diesel fuel increased, there would be something there, some mechanism that would help you out. In other words, the funding formula is not flexible enough now at all.

Mr Armstrong: Not dealing with a world market such as the energy market.

Mr Hoy: Or such a winter. I think most would agree it's colder here in southern Ontario than it has been in maybe two or three years.

I wanted to know what your approach would be. It's simply to work with the funding formula to put something in place that would address it if need be?

Mr Armstrong: Yes.

Mr Christopherson: Thank you very much for your presentation. Certainly your message is consistent with what we've heard in virtually every community across the province that we've been into.

I was struck when you said in your second paragraph, and I'm quoting from your document, "It is when this school board chose to close Euphemia Central school that I felt I needed to get involved to ensure a sound learning environment was being provided to our children as well as to all children in the Lambton Kent district." Were you politically active at all before?

Mr Armstrong: No. I guess one of the biggest things I'm seeing now that I am involved --

Mr Christopherson: That was going to be my question. You're jumping ahead of me, but that's exactly where I'm going. I wanted to get a sense, first of all, whether you had been involved. I got the impression that no, you were just sort of the average person going along, watched politics but weren't particularly engaged, and then saw this and it moved you to offer yourself up and that's how you ended up. Is that accurate?

Mr Armstrong: Yes.

Mr Christopherson: Then my question is exactly where you wanted to go and that is, how's the view now from the inside? I'm sure you had some preconceived ideas about the trustees, about the system, when you first started to get involved around the school closure, both good and bad, and now you're there, you're on the other side of it. What's that telling you? What's the personal experience telling you now that you've been on both sides in a fairly compressed period of time?

Mr Armstrong: What it's telling me is the fact that ever since the school boards were conceived in 1969, as long as the education of their children was going along unaffected, no one really cared. I think that's one of the biggest problems that faced education, the fact that school boards basically went along, raised taxes, did whatever they felt needed to be done and basically were unaccountable. I was the same way. I didn't bother reading up on it. The kids got on the bus to go to Euphemia Central School every day because you just took it for granted that Euphemia Central School was going to be there.

Student-focused funding came along and the school boards are still spending money in some ways that I don't agree with. There are some serious spending practices that go on in the larger urban centres. I just want to make myself clear: this is my opinion; this isn't the opinion of the Lambton Kent District School Board. Anyway, I still see that as a problem and I feel that the rural areas, especially, are starting to pay for the student-focused funding because, unfortunately, what happens is, when we get allocated the amount of money the government gives us, the school board has a tendency to divide that among the number of students that are there. That gives them a dollar figure. Anyone who thinks a rural child is educated for the same number of dollars as an urban child is only kidding themselves. It's always been more expensive to educate a rural child than an urban child because busing is involved in the smaller schools.

Mr Christopherson: I represent an urban area. Hamilton West is my riding. The other side of the coin is there are circumstances unique to the demographics in the large urban centres that are different in terms of ESL and there are more children with special needs because of the higher population. Whether it balances or not, I don't know, but certainly I wouldn't argue your point that there are unique costs to rural that don't apply to urban. I would just suggest that it plays both ways.

I'm curious, though; what sorts of things do you think boards are wasting money on in cities like mine that are causing communities like yours to lose? I don't quite understand that.

Mr Armstrong: I can only comment on the board that I'm from because I know some of the practices that they are doing currently and that they have done. Again, the opinions I'm expressing are my own. I'm only one trustee, so it is only my opinion. There are some high schools that have swimming pools in them, some that don't. There are some elementary and secondary schools that have air conditioning in them; some of them don't. One of my biggest concerns is dollars that are being spent on computers. I question whether we are actually getting our dollar's worth out of computers. We have a tendency to buy the top of the line computers when they are still rather new technology and 10 years down the road, those computers are worth absolutely nothing. There has to be a give and take in some of the areas that we're spending money on.

Mr Christopherson: Of course, the computer issue would be similar in an urban and a rural. That doesn't change.

Mr Armstrong: That's right.

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Mr Christopherson: Listen, we might disagree on some of the particulars of what you've said -- and I say that not as an NDPer but as an individual MPP, to respond to you in kind -- but certainly the whole concern that you have around the funding and the fact that student-focused funding, because of its definition and cuts elsewhere, is not serving and is putting added pressure on you as one of the custodians of the education system here in this area is one that I think you and I share. I look forward to your dialogue with the government, and they're next.

Mr O'Toole: Thank you very much, Mr Armstrong, for making your views known to the committee and also for the longevity of service to the community -- not politics, but really respecting your grandfather and the tradition, not just to the township but to the specific school. I commend you for standing up. Also, that's going to be the difficulty, that you don't become co-opted. I was a trustee for a couple of terms, as was Tina. A lot of people here served in other roles than this. You will get co-opted because you don't have the PhD or the legitimacy. It's just a humble kind of view of the world, "Computers aren't important," and the way you describe it will be twisted so that you will look like you aren't qualified to speak.

Mr Armstrong: It's not that I don't believe computers are important, but that --

Mr O'Toole: I didn't say that, but I may share --

Interjection.

Mr O'Toole: No, what I said was that you will be dismissed, generally.

I want to concentrate on a couple of things that aren't particularly unresponsive to the points you raised. Certainly on the student transportation, as you know, there is a subcommittee dealing with transportation. It's a very important issue, especially in rural boards. A lot of my riding of Durham is rural as well. I have small schools. We've got issues on declining enrolments in some areas; it's too far away from where the spaces are. So we're quite aware. The Chairman, Mr Beaubien, is a strong supporter -- and I'm not speaking on behalf of him except I'm repeating what I've heard him say on the issue of declining enrolment. Boards have serious challenges. There may need to be flexibility within that funding model, specifically on the capital side. I'd be quite supportive of that.

We have also contributed, I believe, one-time spot funding -- I think it's $200 million -- to transportation, allocated based on some usage and routes data. So we are looking. We're quite aware, as you are, that all of the pressures and the inflation across our economy couldn't be attributed to the fuel issue.

I just want to make sure that we get on the record that the stability of funding formula addresses a perennial problem. In my area, the board I was with, the Durham Board of Education secondary panel was and probably still is excellent. I'm not a teacher, so I'm not qualified, but my wife is and my daughter is a high school teacher so I do hear about it a lot. Quite a lot, actually. But they were recognized as the best board in the world -- the Bertelsmann award. I knew many of the people. Pauline Lang was the director of education. In fact, our government picked her. She was the head of the curriculum review; she was the curriculum leader. And the math curriculum was developed by a teacher who is in a little high school just north of where I live. I know them very well. Excellent people. It was also one of the lowest-funded boards in the province.

This inequity of some boards getting $8,000 per student and some getting -- it was all based on assessment wealth. The Royal Commission on Learning and the Fair Tax Commission both said that the province should fund education. Big problem: they couldn't use the ratchet effect in negotiations. I firmly believe that over time it will be a public education system, not a Cadillac and not a dilapidated Volkswagen. It will be very appropriate. I think we're going to hear that. There has been no money cut -- no money cut -- from education. I have the numbers. These are the public accounts audited. The next presenter is going to say there was $1 billion taken out. That's an absolute -- you're not supposed to use this word -- lie. It's propaganda. There's the numbers.

The Chair: I don't think that's appropriate.

Mr O'Toole: It's inappropriate, so I'll withdraw it. But I would say it's not accurate.

Mrs Molinari: It's inaccurate.

Mr O'Toole: It's inaccurate. I'd like you to stay and listen to it, because I've heard it until I'm sick of hearing it.

In conclusion, we must have quality, accessible and accountable education in all parts of Ontario. I'll be supportive of that, and I can't speak for my peers, except that is the goal of Janet Ecker. I commend you as a new trustee to stay focused, not on my agenda but on your own. I've read and listened to your report. I commend you. I encourage you to speak up positively to the board and challenge them so that every single dollar possible goes to that classroom and that student and that teacher. Everything else, whether it's buses or shovelling snow off the roof, question it.

The Chair: Any other comments?

Mr Armstrong: Well, I guess I have to agree with everything you were telling me. It's just that there are still some problems. No one is perfect, and there are a few problems with student-focused funding.

The Chair: On behalf of the committee, thank you very much for your presentation this afternoon. It's always nice to see you, Jamie.

Our next presenter is not here, but the last presenters are in the audience. If it's OK with the committee --

Interjection.

The Chair: Only one? OK. It looks like we're going to have to take a recess until that person arrives or the next presenter arrives. We'll recess for a few minutes.

The committee recessed from 1647 to 1706.

The Chair: If I can get your attention, I'd like to reconvene. Our presenter has arrived.

ONTARIO SECONDARY SCHOOL TEACHERS' FEDERATION, DISTRICT 10

The Chair: Could you please come forward and state your name for the record. On behalf of the committee, welcome. You'll have till 5:30.

Ms Jane Hulme: I apologize for being late. I'm Jane Hulme, president of the Ontario Secondary School Teachers' Federation, district 10.

I've prepared a document for you to outline some of the concerns we have, and I'll take a few minutes to go over some of the things.

Certainly in our area, in Lambton Kent District School Board, school closure is a huge, huge issue. Last year our district school board closed seven schools, and this year 10 are on the docket to be looked at. That's causing a lot of difficulties in our community, and I believe the reason behind the problems is the fact that the funding formula that generates the pupil spaces is flawed and doesn't allow very much flexibility for some special considerations.

As I'm sure you're aware, in the Lambton Kent District School Board we have a number of schools that are very small -- they're in rural communities. Also there are some children who have some specific special needs, and we have attempted to address those special needs with some special types of schools. For example, Alexander Mackenzie Secondary School in Sarnia has a reputation for having a lot of success with special-needs students, as does John McGregor Secondary School in Chatham. They have some very specialized programs for students with special needs.

The other item is the remote and rural grant being very restrictive and the fact that we don't actually qualify for a remote and rural grant, despite the fact that our schools are very spread out from one another and that would make busing absolutely impossible and not very conducive to good education.

If I can take you to the bottom of the first page, about Alexander Mackenzie Secondary School, the pupil allocation formula determines that Alexander Mackenzie school has about 800 spaces. However, it appears to be bulging at the seams at 458 students. One of the reasons for this is that we have a number of IPRC students. In fact, at Alexander Mackenzie school you have to be IPRC in order to attend that school. There are some very specialized programs. There are kids who need medical equipment such as walkers and wheelchairs; they have some very high special needs. The hallways are very wide, and the classrooms are very big. Because of the nature of the programs -- for example, they have a horticulture program -- and the fact they need a lot of space in the classrooms to facilitate mobility and to store the things they're using in the horticulture area, that doesn't leave a lot of room for student seating. Therefore the classes are a lot smaller. But those are the types of programs that put our kids back into the workforce, that give them the skills that take them into the workforce and lead to a very profitable future.

The other issue is certainly that the distance between schools is very great -- there's a chart I've provided for you. You can see the number of students who are in the schools. At Alexander Mackenzie there are 458 students; at Blenheim, 670; at Tilbury, for example, there are only 334 students. But the distances between those areas are very great. I've provided a map for you on the third page. It highlights the locations of the schools. To close any one of those schools would make it extremely difficult on busing -- it would provide a lot of transportation problems -- and really wouldn't facilitate a good educational experience for the kids. That puts us in financial straits because we've got too many pupil spaces. I believe that by adjusting the pupil allocation grant, basically, we could adjust and meet the needs of the Lambton Kent District School Board.

In part B we talk about funding for extracurricular activities. I know that's a hotbed right now, but behind the newspaper headlines is a more serious and chronic problem, and that is underfunding. At just one of our schools in the district, LCCVI in Petrolia, an average of $310,000 has been spent on extracurricular activities in the last four years. On an annual basis, the board has contributed about $15,000 -- less than 5%. The balance of the funding for these activities is acquired by fundraising, particularly bingo -- another hot topic in our area -- and from user fees that are imposed on students. It doesn't provide enough money to adequately operate the programs, and certainly the issue of transportation also comes into play.

The imposed increased workload legislation has created difficulties for teachers, who feel they may not have the time to run as many extracurricular activities because of their added responsibilities. For those who do have the time, there are no funds set aside to hire an occasional teacher to replace the teacher who is involved in an extracurricular activity that takes places during school time.

The quick-fix solution to that is not to have extracurricular activities that take place during the day. But that's simply not feasible in an area such as ours, which is so diverse in terms of geography. I use the example of North Lambton Secondary School, in Forest, playing Tilbury in a basketball game. It would take them at least two hours to travel from one location to the next, and that's on a good day. That's how long it takes me to travel in a car, so it may take a little longer, factoring in bus travel. The basketball game, including change time etc, would take approximately two hours, and then coming back would be another two hours, more or less. That would be approximately six hours in travel time.

It would leave very little time for students or teachers who are involved in extracurricular activities to study or prepare homework or lessons for the next day. For that reason, a lot of travel has to occur during the day. But there aren't any funds to run the buses during the day, and so one of the things that happens is that we're selling chocolate bars, doing fundraising to try to cover the cost of an occasional teacher or the cost of busing.

In part C I talk about workload and staffing. Teacher workload and pupil contacts have increased dramatically with the advent of Bill 74. While the government promised that the school boards would have a maximum average high school class of 21 students, a lot of parents actually believed the maximum class size was 21. That's not the case. In fact, in the Lambton Kent District School Board, where there are a number of rural schools which are traditionally smaller, the format disproportionately affects students in the urban areas. Because the smaller schools generally have smaller classes, these force the other schools to increase their class sizes so that the funded average is met across the school board. At the same time, funding is cut in areas such as guidance and library.

For example, despite the fact we have 14 secondary schools, there is only enough funding in the funding formula to support 12 teacher-librarians. Schools such as Alexander Mackenzie, or John McGregor Secondary School in Chatham, which I've discussed, have highly specialized programs for students with special needs and they affect the average class size in other schools. The very nature of the programs forces the average class sizes in other schools upward. It's not unusual to have class sizes of 32 or greater in order to support the programs. This is not new. That has happened in the past, but not to the level that it's happening now, and these are the constraints we're working under right now.

Bill 74 was designed to reduce the number of secondary school teachers by increasing their workload. In fact, the number of secondary school teachers in my district has decreased dramatically since amalgamation. In 1998, there were 753 full-time teachers; in the year 2000-01, 663. Part of this decline is due in fact to reduced enrolment, but more significantly it's due to the increase in workload.

The teachers have contact with more students, not more contact with students. Students have less individual time with the teacher. In fact, many teachers are jumping at the opportunity to leave the profession. I've received 40 letters of retirement from teachers, of the current 663. Many of them are not retiring because they've reached the end of their career; they're retiring from teaching in Ontario. Many are moving to the United States. Baker College in the United States seems to be getting a lot of our teachers. They've decided that their working conditions have made it impossible for them to continue doing what they feel is best in the classroom and they are moving onward and taking other jobs.

Now, this may not really seem significant. We have a teacher shortage looming in the future. The loss of these 40 teachers actually has a lot of impact on next year's funding also. I'm not sure if you're aware there's something called the teacher compensation grant in the funding formula. It actually claws back funding from school boards where teachers are placed at the bottom of the experience and qualification grades. This clawback is approximately $15,000. If the Lambton Kent District School Board replaces these 40 retiring teachers who are going in June with 40 newer teachers, the net result is about $600,000 less revenue than they would have been receiving before. So they're not benefiting from what we used to call rollover savings resulting from hiring less experienced teachers. The rollover savings used to be directed toward the school board so they could hire more teachers at a reduced cost, and certainly now they don't have those savings.

The last page is a list of some recommendations that we're suggesting:

The remote and rural grant should be less restrictive and the pupil accommodation grant should recognize the diversity of schools. In that, I mean schools like Alexander Mackenzie Secondary School or John McGregor Secondary School.

Local district school boards should have the ability to tax at some level to raise funds for education through taxation. That may be simply that if the community decides they want a specific program in place, they should be able to decide and be able to raise the funds to do so.

The provincial government should allocate funds for busing and equipment for extracurricular activities. That currently is not the case.

The government should immediately move to restore working conditions for Ontario secondary school teachers by investing in additional teachers to remedy the excessive workload.

District school boards also should benefit from the rollover savings resulting from hiring more inexperienced or beginning teachers.

I would be happy to answer any questions you had.

The Chair: I'm going to ask each caucus's co-operation here, because we're short on time, but I'm going to allow two minutes per caucus. I'll start with Mr Christopherson.

Mr Christopherson: Thank you for your presentation. You mentioned the number of teachers you've lost, who have left. You said some of them were because of declining enrolment. Do you have a percentage on that?

Ms Hulme: I know that for next year, we're anticipating a loss of about 200 students. A lot of that occurs during a normal teaching year; it has ups and downs. But we're losing about 200 students.

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Mr Christopherson: And that would normally mean how many teachers?

Ms Hulme: About every 15 to 20 students count as a teacher.

Mr Christopherson: So you've still got the vast majority of them leaving?

Ms Hulme: Yes.

Mr Christopherson: Are they not being replaced? I'm trying to --

Ms Hulme: They are being replaced. They're definitely being replaced, or some of them will be replaced. Not all 40 will be replaced because of the declining enrolment. But the idea of it is that the clawback situation is really affecting the school boards. They're actually being penalized for hiring younger, more inexperienced teachers. They're at the bottom of the grid.

Mrs Molinari: Thank you very much for your presentation. There are a couple of points, and then I have a question. It's interesting to hear mentioned sometimes that teachers are leaving the career and going to the US. Teachers leaving is talked about quite often. In my past experience, having been the chair of a school board, one of the criticisms the teachers had of this government was that it was in some way Americanizing Ontario and being too much like the US. So when I hear that teachers are leaving Ontario to go to the US, I'm trying to understand the bigger picture.

The other comment has to do with taxation. You recommend that there should be some taxation ability for school boards. Part of the problem with funding and taxation was the disparity between boards that were rich in assessment versus boards that were poor in assessment. Across the province there were inequities by virtue of the population. It was unfair for students living in an assessment-rich board to be getting a lot more than those living in an assessment-poor board.

The other difficulty was that when they had the ability to do that, undue influence was put on the boards and the trustees whenever contract negotiations were taking place. There was more pressure put on them by all the employee groups to go for wage enhancements, better working conditions and a number of things. Boards felt they were put against the wall and had to keep increasing taxes in order to provide for some of the contracts they were agreeing to.

The Chair: You have 30 seconds to wrap up.

Mrs Molinari: Just a question, then. Do you know where your board was with respect to the taxation disparity in reference to either the coterminous board in the same area or with surrounding boards as far as the taxation level in your board?

Ms Hulme: It would be difficult for me to comment on that because of amalgamation. I'm from the former Lambton board. We amalgamated with the former Kent board, and that would skew all the numbers. I hesitate to speculate on that.

Mr Hoy: Thank you for your presentation this afternoon. I appreciate the five points, the recommendations you make on your last page.

I couldn't agree with you more that the remote and rural grants should be less restrictive. I've met with parents who have talked about deer running through the yard of the school and they don't qualify for the rural, the remote or a combination of both rural and remote grants. It would seem to me that if anything was rural or remote it would be having deer running through the backyard. That would be a pretty good example of what's happening. Yes, there should be more flexibility in that. Ontario has wide expanses of both rural and remote areas, and we have a lot of fine urban situations that have to be dealt with as well. But I very much agree with that.

Currently in the conversation about elementary school closings, parents are afraid that their student is going to move to another rural school and two years later it will be closed. That could happen with high schools, by the way.

I appreciate your presentation. Your observation on busing is well taken. If the board is to get this rollover saving, I expect that someone is going to suggest, "Where would that money go?" If it's not for teachers' salaries, where would it best be placed? You have above that a list of four areas we could talk about, and maybe it could be shared equally.

The Chair: On behalf of the committee, thank you very much for your presentation. I'm sorry we had to rush you.

Ms Hulme: I apologize for being late. There was some activity outside.

ASSOCIATION OF COLLEGES
OF APPLIED ARTS AND TECHNOLOGY
OF ONTARIO

The Chair: Our last presentation this afternoon is from the Association of Colleges of Applied Arts and Technology of Ontario. I ask the presenters to come forward and state their names for the record. On behalf of the committee, welcome.

Ms Susan Bloomfield: My name is Susan Bloomfield. I'm chair of ACAATO, the association of colleges. I represent 25 board chairs and 25 presidents for the province. So rather than a local perspective, Dr Rundle and I are going to be giving you a province-wide perspective of the needs of the college system. With me is Dr Howard Rundle. He's president of Fanshawe and chair of the council of presidents for ACAATO.

I've been involved in the college system for six years. Up north, in Sudbury, I was chair of the board there for two and a half years and a member of their board for six. I have since moved down to a beautiful little village called New Dundee, in the Kitchener-Waterloo area, and I'm thrilled to be down in southern Ontario with you.

I'd like to talk for just a few minutes about the situation we're in and what we need you to do. In the last 10 years our funding has been cut by 40% and the enrolment has gone up 35%. That is a huge statement to make, and when you grasp it in terms of 25 colleges and the whole region in Ontario, you realize we are at a point where the situation has to change in terms of our funding formula, which you'll see on page 2 of the information I provided for you -- the recommendations that we need -- and it needs to be done right now. We have a very good working relationship with the current government. They have been very embracing in terms of forming committees and working with us in terms of changing that funding formula and being quite sensitive to the needs of where the college system is right now in terms of immediate assistance. So I direct you to that, and Howard will address that specifically for you.

We are committed to serving the province, to getting our students through to get into the workforce and be contributing members of society. This is our goal. We are totally student-focused. But for the government to come through on their promises to these students, we really do need to take a clear look at what has to be done. I realize today has been difficult for you, because everybody has been picking and pulling and making demands on you. I won't say we're different, but we do arrive today with very clear solutions to the problem and a very honest assessment.

KPMG did an assessment for us over the course of the last year, and they clearly stated that if we stay in the mode we're in, we will be not only in deficit, but we will be in a position within 10 years of having a debt of $538 million. Every college in the province, all 25, will be in a deficit position by April 1. That's how serious this is. I really would appreciate your full attention to the document and to the solutions. Dr Rundle will work us through that right now. We would appreciate most of our time spent on answering your questions.

Dr Howard Rundle: I'm not going to go through the document in detail; I'd rather respond to questions. But I'd like to highlight a couple of things.

Susan mentioned that you've been pulled, I'm sure, today by a number of groups, everybody asking for more money. I guess the situation in the colleges is that our prime purpose is training and retraining people for the workforce. When that happens successfully, there's a payback on the investment. When it doesn't happen, then the money gets spent in other ways, whether it's through the welfare rolls or through correctional institutions or whatever. So investment in colleges is not money down the drain.

1730

Why has the situation become critical this year? One of the presenting issues was the government's decision a year ago to, in effect, freeze tuition fees, a decision that I'm quite in agreement with. Tuition fees are now limited to an increase of 2% per year for the next five years. In the last five years, colleges have survived because of the government's decision to shift a greater portion of the bearing of the costs to the student. Again, I'm not particularly opposed to that decision. The students benefit economically from attending colleges. But it has been that significant increase in tuition fees over the last five years that has allowed us to carry on economically and now that lever is gone.

So we're trusting that the decision to limit tuition fee increases to 2% was also a decision by government itself therefore to pick up the increased cost from inflation alone, if nothing else. Otherwise, what is the decision? Is it to lower the quality of education and training that leads to jobs, or is it to reduce the volume of training at the very time we're poised in front of the double cohort and the baby boom echo when demand is going to go up? I can't believe it's public policy to reduce either the quality or the quantity of college education that has the kind of payback we're talking about.

In the paper, we offer sort of a menu of ways that this could be addressed, appreciating that the province may be facing a bit of an economic slowdown. Not every single financial measure proposed in this paper is necessary. It is a menu. If some of them are chosen, those that fit government policy better perhaps, that would be fine. But unless something along these lines is done -- my colleagues described it yesterday when we had our annual conference as "hitting the wall" this year, now that there are not going to be significant tuition fee increases.

That's the dilemma we face. It's quite significant and I certainly hope there will be a response to it. I'm going to stop there and we'd be pleased to answer questions.

The Chair: We have approximately five minutes per caucus and I'll start with the government side.

Mrs Molinari: I'll begin and then my colleagues may also want to make some comments.

Thank you very much for your presentation. I will review it and read it more clearly in the next little while. Just a couple of questions on your feelings on the key performance indicators that have recently been introduced.

You've indicated here that this is a menu and these are all ideas and in an ideal world, I suppose, doing all of these things would definitely assist and this is what you would want. But you did indicate that it's a menu, so if you could talk also about what the priorities are and which of these you feel is most essential and which would be nice and which would be, "Wow, that would be great."

Dr Rundle: OK, I would be glad to do that. On page 2, the first priority clearly would be some increase in the basic operating grant that would match inflation -- and not looking for a huge number there. The number that I've been throwing around is about 3%. Inflation is running at about 3%. That would be a minimum. Probably inflation in the college system right now is a bit ahead of ordinary inflation. We're heavy on energy costs and equipment costs and they're going up rather dramatically.

Mrs Molinari: Do you have a dollar figure?

Dr Rundle: Three per cent of the operating grant; the operating grant is about $600-plus million, so 3% of that. That would be the number one priority.

I think probably the number two priority would be the KPI issue. We're quite supportive of that approach to funding. It's an approach that is encouraging performance and not simply funding based on volume, so it provides incentive to institutions to perform.

The important component there is that the KPI money should be additional money, otherwise the system becomes predatory. If the KPI money comes from us stealing it away from Conestoga or vice versa, then that has as much negative impact as positive. That's the way it was introduced last year: 2% of funding for KPI was additional funding on top of the operating grant and that's an excellent way to do it. If the government wishes to increase that funding to 4%, for example, and increase the incentive, great, if that were additional money; not great if it's simply scooped away.

The third priority would be either renewal -- we've had a fair bit of deferred maintenance with the kind of cutbacks in the operating grant that Susan mentioned, which have been quite significant and have not been restored. If we compare, we look rather enviously at the health sector now, where virtually all of their cuts have been restored and then some. These reductions have never been restored so it's natural in that situation that institutions reduce the expendable things, things that you can live for a while without, such as maintenance of facilities and deferring acquiring new equipment. With the computer age and what's happening there now and the necessity to keep up on that, that would be the next priority, either or both of those.

The other things on the list, I would say, are the lower priority. So the first two I mentioned I would think are of extremely high priority; the next two, it would be really good if those could be done; the last ones, I don't know if I would go so far as, "Wow" --

Ms Bloomfield: They're needed.

Dr Rundle: They're needed but could be left to another time.

The Chair: You have about a minute and 30 seconds.

Mr O'Toole: Just on the facilities renewal, you will know that SuperBuild is almost $2 billion when you make the private partner connection and that's creating space. Obviously with that there will have to be operating dollars. That's a current debate somewhere. Tina is the PA to that ministry so she probably knows more about it, but it's a raging debate.

I think some of the issues you've brought here in concise form are important priority advice. This is what Tina was asking for. How you tie it to outcomes and accountability is really a priority with the government. I think your advice and attention to that would be good for us, because the tradition of throwing money at it without the accountability -- the ATOP grant is a perfect example of specifically targeting funding, both capital and operating, to make sure we have the latest -- but we appreciate your input today.

Just out of respect, Durham College, Gary Polonsky, is in my riding, a great college. He's a wonderful builder of community and education. So we do listen and we certainly know that that's the kind of infrastructure we need to be a successful, caring society.

Dr Rundle: I can say that the ATOP has been an excellent program and it absolutely is producing results. In the London area, Fanshawe College increased its IT output by the second-highest in the province of Ontario. It tripled the production of those types of employees.

Mr Kwinter: Thank you very much for your presentation. I am a real fan of colleges of applied arts and technology. I think you do a wonderful job.

Over the course of these hearings, we keep hearing from groups that are not in the new economy, they are still in the old economy, and they complain about the fact that their apprenticeship programs aren't working. They are not getting the interest and the students to come into their particular trades, whether it be carpenters or plumbers or bricklayers, because there seems to be a lack of, if I can put it this way, prestige in going into these particular trades, yet they are absolutely critical. This is something where students, if they choose to do this, have a wonderful future, where they can get an income that others would envy and they didn't seem to know quite how to address this problem. I'm just wondering whether you, Dr Rundle, can address that.

1740

Dr Rundle: It's a very real problem, compounded in fact because most of those trades women don't consider appropriate. So you're dealing with half the population, and they can perform quite well in most of those trades -- a very real challenge, and we need to be constantly addressing it.

There's one thing we're trying here in London right now that's something new. We had a very generous donation from the London Free Press in the form of free advertising, $100,000 worth of free advertising, so we're not talking about a little bit. We've devoted that entirely to that problem. In fact, I commend the Saturday issue to you. There's a half-page ad that is promoting the trades training and pointing out to young people that there are good incomes there if they would consider those professions. Whether this will work, we'll see, but there's a societal thing in North America, unfortunately, that doesn't exist in Europe and it's the prestige of people working in those professions. But if they saw the kind of money they can earn there compared to some of the other more prestigious things, like IT -- I mean, it's good money there too, but you can do just as well -- better -- as a diesel mechanic in London right now than as an IT graduate.

Ms Bloomfield: Or tool and die.

Dr Rundle: Or tool and die.

Ms Bloomfield: Tool and die makers make $60,000 to $70,000 a year, easily.

I think we have to keep in mind that the community colleges are the widest spectrum for post-secondary education. You have people who are immigrants coming in learning a second language, you have people who come in and have grade 3 or grade 4 education; they start with upgrading and they go through the system. We provide the best and most meticulous smorgasbord for people to be educated lifelong.

Definitely we have demonstrated over the adjustments of the last 10 years that we've been able to be fiscally responsible, tuned in to what each community needs, able to adapt to whatever change comes along and do it quickly. One of our strengths is our ability to respond quickly to whatever the needs are in the environment.

We are at a point now, though, where we can't make miracles. We have to have basic changes in the funding structure and we have to have those envelopes this year to meet the needs and the commitment of this government. I look to you to extend that direction and support it because the colleges are the community; we truly are. We can't maintain that and devote the kind of expertise we have given over the last 35 years without your knowledge and support.

Mr Christopherson: Thank you both for your presentation. I'm the proud representative of Mohawk College, Catherine Rellinger's territory.

Ms Bloomfield: Congratulations.

Mr Christopherson: I knew Keith McIntyre really well; I'm a big fan of Keith's and the work he had done. It was shocking to hear you say that by April 1 all the colleges are going to be in deficit. I would just point out to you that a lot of people came in with the mindset, especially in the opening days, that this was all about struggling for $1 billion. First of all it's been much more than that and should be. Regardless of who's in power, it should be a discussion about starting with a blank slate. Second, it's pretty optimistic now to think there's still going to be $1 billion available, and for the next couple of years, because there's the lag in the transfer payments from the feds and they're going to be lower than they've historically been. So it's going to be impacting on at least two budgets and things are going to be tougher.

Having said that, you've got friends in high places. We know this government is very selective about whom they listen to, and we know they like the banks, particularly the TD, given certain pieces of labour legislation that helped them. But Mr Drummond came in. He's the senior vice-president and chief economist for their financial group, and he went out of his way to show two different charts that showed the decline in support -- to be fair, both the national funding as well as Ontario -- doing a comparator and making the case obviously in the context of a business presentation that funding post-secondary education is key, absolutely key.

When I look at the charts you have, it's pretty clear to see that once the real GDP starts to drop -- and it's going to -- then there's every reason to believe you're going to see a peak. That will be in addition to the population growth, as well as those who realize that the only real opportunity for them to make decent dollars is to get as high an education as they can.

Having said all of that -- and I've asked this before, but it's good to get it from the umbrella organization -- if the funding isn't there and you're not able to meet the needs of the double cohort that's coming through and the population increase and also, of course, that inverse reaction to the economy, what happens to all those students, and some of them are adult students --

Ms Bloomfield: A lot of them are.

Mr Christopherson: Most of them, probably.

Ms Bloomfield: The average age is 26 years, for the average student.

Mr Christopherson: So we have a lot of adults who want to go into the colleges -- and the universities, but in this case the colleges. If you don't have the funding, what happens?

Ms Bloomfield: We cut programs, we cut staff and we lose community.

Mr Christopherson: And these folks just get turned away.

Dr Rundle: The only other choice is reducing quality. I know our own board has decided that is an unacceptable --

Ms Bloomfield: That's not acceptable.

Mr Christopherson: That's the kiss of death.

Dr Rundle: Exactly. They would rather not meet the demand than meet the demand but lower the quality of training.

Mr Christopherson: I suspect what we may be looking at -- it's probably not going to be overly helpful -- is there will probably be some money, but not nearly enough, and you're going to be left with this dilemma. What I worry about when you're in a situation like that, as I understand the post-secondary education system -- and I'm no expert by any stretch -- my sense of it is that what starts to give then is that there's enough money to take the student in, but it's the quality issue that starts to give. They're not going to put up with the politics of seeing thousands of people turned away in all of our communities, I would think, but if they haven't given you enough money to adequately meet the need, then what happens is, yes, the students get in the door, the headlines are avoided, but the quality inside starts to go.

Ms Bloomfield: I want to direct you to two things. We see a million students per year, and I want you to see that in 1990 each student had funding from the government of $5,775. Today we are down to $3,472. The colleges have been able to maintain quality and access for 10 years with more than a third less dollar value in an increasing inflationary market. We have the ability to deliver. We've done the best we can for as long as we can and we've hit the wall.

Mr Christopherson: Are those constant dollars? Are they constant dollars or actuals?

Dr Rundle: I don't think so, no. They're probably actuals.

Mr Christopherson: Really? That's even worse. That paints an even --

Ms Bloomfield: I think what it says is we're great; we're extraordinary. We have done an amazing job to continue the quality. But we are not magicians. We can't do any more in this situation without a change in the funding structure, and that can solve a lot of the problems. I don't think it needs to get to crisis. I don't.

Mr Christopherson: Do you see the possibility of privatizing more of the college services on the horizon? Is that a concern?

Dr Rundle: We don't support that.

Mr Christopherson: I know, but is it something that you can see -- we know it's happening with the universities. The legislation's there.

Ms Bloomfield: I hope not. That's going to be very expensive for students if it's privatized.

Dr Rundle: We tend to serve students that are not in as high an economic bracket as those who go to universities.

Mr Christopherson: Absolutely. That's why I worry about it. I want to find out whether you see that as a possibility, because often they use, manufactured or otherwise, a crisis to say, "We've got to do something," and the something, of course, is worse. But they argue, "We did something, and we're the only ones with the guts," and all that nonsense.

Dr Rundle: It's more costly for students to access private training -- and it's available. Look up the street here from this building. It's more expensive. If the college option isn't there, I don't think those students will have a post-secondary option.

The Chair: With that, I have to bring it to an end. On behalf of the committee, thank you.

Ms Bloomfield: That was a fast half-hour.

The Chair: Well, we still have to travel. On behalf of the committee, thank you very much for your presentation this afternoon.

Before we adjourn, I have a small announcement. Tomorrow morning, we will be meeting in committee room number 1.

Mr Christopherson: Why is that?

The Chair: Because 151 is being used by the justice committee, I think, tomorrow morning. So we'll adjourn until 10 o'clock tomorrow morning.

The committee adjourned at 1750.

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 Pat Hoy (Chatham-Kent Essex L)

Mr John O'Toole (Durham PC)

Clerk / Greffière

Ms Susan Sourial

Staff / Personnel

Ms Elaine Campbell, research officer,
Research and Information Services

CONTENTS

Tuesday 20 February 2001

Pre-budget consultations F-929

London Home Builders' Association F-929
Mr Carl Dinardo

University of Western Ontario F-932
Dr Paul Davenport

Together in Education F-937
Mr John Ryrie; Ms Pat Cannon; Mr Brydon Elinesky

London Chamber of Commerce F-942
Mr Gerry Macartney; Mr Wayne Dunn; Mr Todd van Rees

Investing in Children F-946
Ms Jan Lubell

London and District Labour Council F-950
Mr Gil Warren

Advance London F-955
Mr Dale Henderson; Mr Jeff Shervington

Thames Valley Children's Centre F-960
Dr John La Porta

Alliance of Canadian Second Stage Housing Programs (Ontario Caucus) F-962
Ms Ruth Hyatt; Ms Donna Hansen; Ms Wendy Makey

London Muslim Mosque F-967
Mr Adeeb Hassan; Mr Ashraf Eldamatty

Elementary Teachers' Federation of Ontario, Thames Valley Local F-971
Ms Nancy McCracken

Interfaith Social Assistance Reform Coalition F-975
Rev Brice Balmer; Rev Darlene Cunliffe; Rev Frank O'Connor;
Mr Greg deGroot-Maggetti; Rev Susan Eagle

Ontario Business Network F-979
Mr Bill Ross; Mr Mike Vanpelt

Lambton Kent District School Board F-984
Mr Jamie Armstrong

Ontario Secondary School Teachers' Federation, District 10 F-987
Ms Jane Hulme

Association of Colleges of Applied Arts and Technology of Ontario F-990
Ms Susan Bloomfield; Dr Howard Rundle

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