LEGISLATIVE
ASSEMBLY OF
Monday,
April 26, 1993
The House met at 8 p.m.
COMMITTEE
OF SUPPLY
(Concurrent
Sections)
FAMILY
SERVICES
Mr. Deputy Chairperson
(Marcel Laurendeau): The Committee of Supply will be resuming consideration
of the Estimates of the Department of Family Services.
When the committee last sat, it had been
considering item 1. Administration and Finance (e)(4) Information Systems (a)
Salaries‑‑pass; (b) Other Expenditures $151,800‑‑pass.
Mr. Doug Martindale
(Burrows): Oh, I am sorry. Are we on five?
Mr. Deputy Chairperson: We are just going to five.
1.(e)(5) Policy and Planning (a) Salaries
$762,000.
Hon. Harold Gilleshammer
(Minister of Family Services): I have
some information I would like to put on the record here in relation to a
question that was asked earlier today in the Program Budgeting and Reporting
communications costs for 1993‑94.
There was a budget line of $19,700. Of that, telephone costs were $4,900;
printing is $13,700, of which the annual report was $11,700 for 550 copies in
English, 250 copies in French. I have a
distribution list‑‑the Legislative Assembly, caucus offices,
central government office, internal distribution in departments, universities
and public libraries, on request to other governments, agencies and the public.
The Estimates Supplement, which is also
part of that budget, was $2,000 for 200 copies, and the distribution is
similar, plus $1,100 for messenger and courier costs. The total cost of that was $19,700.
Mr. Martindale: Mr. Deputy Chairperson, before I start asking
my questions, is there agreement that we are adjourning at 10 p.m?
Mr. Deputy Chairperson: What is the will of the committee?
Mr. Gilleshammer: Oh, I would go later if you would like.
Mr. Martindale: We would like to adjourn at 10 p.m.
Mr. Deputy Chairperson: We will check with what the committee wants
to do at ten o'clock then.
1.(e)(5) Policy and Planning (1) Salaries
$762,000.
Mr. Martindale: Mr. Deputy Chairperson, I see there are two managerial
staff and nine professional/technical.
Could the minister tell us what they do in Policy and Planning?
Mr. Gilleshammer: Yes, I would be pleased to tell you what they
do in Policy and Planning. This is the
branch of our department that has a lot to do with the various functions that
go on within the department.
It undertakes management support,
strategic planning and policy co‑ordination, including briefings for the
minister and deputy minister; support for legislative debate and Estimates review;
and the preparation of policy papers.
It conducts policy research and analysis
on social service and income security issues.
It undertakes program analysis and
assesses the effectiveness of departmental programs.
It prepares and negotiates
A good part of the expenditures within
this department‑‑I will just break away briefly to welcome the
Leader of the Opposition (Mr. Doer) here, a stranger in our midst.
It also conducts research and develops
strategies to maximize federal recoveries, represents the department in
intergovernmental and interdepartmental discussions related to a broad range of
social service and income security issues.
In very broad terms, that is what they do in Policy and Planning.
Mr. Martindale: I guess almost any question on social policy
would be relevant under this line, so I would like to ask if the minister or
his staff can put a dollar figure on the amount of money from the federal
government under CAP that would be lost as a result of capping the number of
child‑care spaces. If you have
fewer children being subsidized, presumably you are giving up some federal
revenue, since I believe child care is cost‑shared 50‑50 by the
federal and provincial governments.
Mr. Gilleshammer: There are some variables at play in the
question that you ask, but if there are 400 fewer children who are occupying a
subsidized space, it would be somewhat dependent on the age of those children
and the rate at which they are being subsidized.
Mr. Martindale: I wonder if the minister could tell us
approximately how much revenue might have been foregone or at least what the
federal government's share of the 400 spaces or cases, and we will get into
that later, was eliminated in the child‑care system.
* (2005)
Mr. Gilleshammer: Again, it depends on the level of the subsidy
required for that particular person. If
it is an infant, the subsidy is greater than an after‑school‑age
placement, so again we can talk in averages.
If you assume that the average per child would be around $16 per child,
a fully subsidized space, the cost would be $4,160.
Mr. Martindale: Could the minister tell us what kind of
analysis the Policy and Planning department did before the child‑care
cuts were made and increases were made in fees, and did the staff analyze the
effects on parents and employment, for example?
Did the staff do an analysis on increased social assistance costs if
parents are unable to get child care and therefore are unable to work or have
to give up employment? Was this kind of
analysis done before those decisions were made?
Mr. Gilleshammer: For sure there was input into the fact that
we had a certain number of spaces. If
you freeze the licensing, we are aware that has an effect on the system. Similarly, when you have 10,000 subsidized
spaces, then when you revert to the fact that there would only be 9,600, there
will be people that may be affected that would have to be on a waiting
list. The reality of the situation is
that we overspent our budget last year considerably, and even though this
year's budget, the print is higher than the previous year, we wanted to be able
to live within that budget.
Mr. Martindale: Can the minister tell us if any analysis was
done and if so what the analysis showed on reducing the number of weeks of
subsidized child care for job search from eight weeks to two weeks?
Mr. Gilleshammer: Well, the department certainly discussed and
brought forward ideas on the fact that we did have a very generous component
within the daycare spectrum of services that was available whereby people who
were unemployed and searching for work could access daycare for eight weeks
twice a year. One of the ways for us to
bring the budget into line so that we could live within the printed amount was
to reduce the number of weeks that they were eligible for.
Mr. Martindale: Now, the minister says that he discussed
these things with the staff and that their previous policy was generous. I ask the minister if they did an analysis
and what the analysis showed? I would
like to have that question answered.
Also was any analysis done on, for example, the average length of time
it takes people to find a job, which might provide a rationale for a particular
time period?
* (2010)
Mr. Gilleshammer: The ability to access a job ranges from, on
the one hand, people that have had a job offered and accepted many weeks ago to
people who will not access a job through the period that they have left school
and are seeking employment. Again, the department certainly made the government
aware that there would be people that normally were accessing daycare from the
end of June to the beginning of September and did not find employment and then
went back to school that would be impacted by this. Again, I point out to the member, we were $5
million over our budget last year and these measures were put in place so that
we could live within a budget that was larger in print this year than it was
last year.
Mr. Martindale: I asked the minister if an analysis was done,
and the minister in his answer said that the time taken varies for different
individuals. So I take it that there was
no analysis done, otherwise the minister would have told me. I am wondering if the minister's staff went
to the trouble of asking Canada Employment Centres how long the average time of
job search was?
Mr. Gilleshammer: The information that is provided from people
who are close to the seeking of employment indicate that there is a wide range
of possibilities there depending upon the skills of the person, depending on
the availability of jobs. Averages can
be factored in but, really, our decision was not based on the fact that we were
able to produce some averages.
Mr. Martindale: So once again the answer is no. There was not a consultation with Canada
Employment Centres. I am left to
conclude that really these were budgetary decisions and there was not a lot of
analysis or thought put into them.
Mr. Gilleshammer: Clearly, these were budget decisions, and I
have explained that to the member, that we had a budget that was overexpended
last year. Even though the new budget is
higher than the print from last year, we were determined, even though we were
going to spend print over print more money, to live within that.
Part of that was to put some restrictions
on the system as to the licensing of spaces and to the accessing of subsidies.
Mr. Martindale: I have a similar question which also has to
do, I believe, with a lack of analysis.
I spoke to a constituent who was very
concerned about the changes in child‑care policy. She indicated that she had a friend who
worked for a public opinion polling company who was hired by the provincial
government to ask questions of the public, specifically if the government has
to cut funding to reduce the deficit, which of the following organizations do
you think should no longer get funding?
One of them was subsidized daycare.
Can the minister confirm that his
government hired a public opinion polling company to find out what kind of
cutbacks were acceptable or unacceptable to the public?
Mr. Gilleshammer: No.
Mr. Martindale: I will ask for a clarification. You cannot confirm it or you know for sure
that it was not done?
Mr. Gilleshammer: Well, the member has some responsibility to
check the facts before he comes to either the House or committee. I am indicating that I have no knowledge of
anyone doing any polling that had anything to do with my department or
decisions made here.
I would caution the member that when he
brings rumours that he gained from a friend who knows a friend who supposedly
works for somebody, that is not very accurate information.
We did a lot of work within the department
to analyze the expenditures that we have, and to make some very, very difficult
decisions that were part of this budget exercise.
Mr. Martindale: I would like to ask the minister in the area
of joint or shared responsibility once again with the federal government.
I understand that the federal government
may be putting out a white paper this spring on a guaranteed annual
income. Does the minister have any
knowledge of that? Are there any
negotiations that are going on now or that you know of in the near future?
* (2015)
Mr. Gilleshammer: There have been indications that the federal
government is going to do that, but we have no hard knowledge about if it will
be done this month, next month or whenever. There has been some public
discussion that a social policy paper may be forthcoming.
Mr. Martindale: I assume then that‑‑well, I will
make that a question. Does the minister
or his department know what some of the topics might be in a social policy
paper?
Mr. Gilleshammer: We have no definitive configuration for a
policy paper other than federal politicians and federal bureaucrats have been
talking about some form of paper to look at planning of social policy on into
the next decade. As I indicated earlier
that when you have provincial Premiers such as Bob Rae saying they cannot
afford to continue the social policies of that government, when we have new
presidents indicating that the largest and most powerful country in the world
can no longer afford to have people sit at home and collect social allowances
and be there for a long time, when you hear the Roy Romanows of the world
talking about the very difficult decisions that had to be made by New
Democratic governments who are used to what they called redistributing wealth
and now they have to cut programs, yes, I think there is real pressure out
there, that there will be some policy papers put forward by the federal
government and possibly by provincial governments.
Mr. Martindale: Does this minister have a position on a
guaranteed annual income? Have your
staff studied this or made any recommendations on it?
Mr. Gilleshammer: Clearly a guaranteed annual income has to be
designed by the federal government and have the input of the provinces. Without having any definite goal posts put
forward by the federal government it is difficult to say whether we can support
that or not. For sure, there is such a
mixture of income transfers from government to government, from government to
individuals. Some of the provinces
exempting it, some of them regarding it as additional income. There is really a smorgasbord of programs out
there now, I think, which in many ways is crying out for some commonality that
does not exist now. It seems to me that
a lot of the tax transfers and benefits are confusing. When we talk about what the basic safety net
is and then layered above that is exempted income and that varies from province
to province, I would think that it is crying out for solution and that if the
federal government is wanting to move in that direction we would support
looking at that.
Mr. Martindale: The minister says it is crying out for
solution. That suggests that‑‑the
minister I think said there should be some changes. So I would like to ask him, are you suggesting
that the system needs to be simplified or what kind of solutions or changes
would you like to see?
* (2020)
Mr. Gilleshammer: I took the question earlier today about
reforms that
Mr. Martindale: I would like to move on to another topic, and
that is, income that some people are eligible for but social assistance
recipients are not. If changes were made
so that they were eligible for that income, there would be a cost to the system
or a cost to the taxpayer, so one is reluctant to recommend those changes
without knowing what the costs are‑‑for example, child maintenance.
My understanding is that women on social
assistance are forced to pursue maintenance, but they cannot keep the money or
their children do not keep the money.
Does the minister know what the amount of money is that may be available
in terms of child maintenance but which single people are not eligible to
keep? Has there ever been an attempt to
put a dollar figure on that?
Mr. Gilleshammer: We are not able to put a dollar figure on
that amount of money that is ordered by the courts that comes in the form of
maintenance payment, but you are correct that that is regarded as additional
income, and it is then deducted as additional income. It is not exempted income.
Mr. Martindale: I have a policy question. What is the rationale for these single
parents not being allowed to keep child maintenance payments, given that
normally they are intended for children and in other family situations, people
are allowed to keep it? I would think
that parents on social assistance are an exception. So what is the rationale for parents not
being allowed to keep the money to spend on their children?
Mr. Gilleshammer: The social allowances is intended to provide
that basic safety net for shelter, clothing and food and determines the rate at
which this is paid, and when additional income is garnered by that individual
or that family, it is not exempted. It
is regarded as additional income and it is treated in that way.
The member is right, that there would
individual families not on social assistance which would have that money flowed
through to them, but in determining the level of social assistance required,
their requirements would be less if, in fact, they have other sources of
income.
Mr. Martindale: I think it is a relevant topic to pursue because,
as we know, approximately 60 percent of single‑parent women live below
the poverty line. So, if we want to
lower the poverty rate for single‑parent women, then one way of doing it
would be to allow them to keep child maintenance payments. So I guess that is one of the reasons why you
need to know how much it costs, but certainly having that additional income
would be very helpful to single‑parent women to enable them to have a
more adequate standard of living.
Would the minister be willing to ask the
Policy and Planning staff to do some research and to provide me some
information at some future date on what the cost to the system would be or even
a best guess of allowing single parents to keep the child maintenance payments?
Mr. Gilleshammer: I would assure the member that, when we are
finished our Estimates either later this week or next week, the staff will take
the time to go through all of the comments that have been made by honourable
members to review what has been said and to see what ability we have to move on
some of those issues.
Mr. Martindale: Could the minister tell us if an analysis was
done on the elimination of the student social allowances program? Did the staff do any analysis or make any
recommendation saying what the effect would be on those students, how many they
expected might possibly be able to return home, how many might have to drop out
of school, how many would go on the city social assistance system for those who
are resident in
Mr. Gilleshammer: As I have indicated earlier, departments
every year bring forward options that are possible target reductions. The
caucus of which the member is a member went through the same process where
people who work within that particular branch of the department bring forward
possible target reductions, and these are analyzed. These are discussed, and the impact is
determined as far as we can take it.
For instance, there are something like
1,100 students on the student social allowances now, and, as I have indicated,
this program will terminate at the end of June.
It is difficult for us to‑‑difficult for anyone to predict
what the decisions that are going to be made by these individuals will be, and
in some cases those student allowance recipients may have three or four options
they look at.
Well, we are indeed pleased to have the
member for
(Mr. Gerry McAlpine, Acting Deputy
Chairperson, in the Chair)
Of the individuals who are on the program,
some of them will graduate; some will return home; some will find part‑time
work; others will perhaps access other programs. So they will have some decisions to make, and
many of them will not make those decisions until later this year.
* (2030)
Mr. Martindale: The minister says that students had options
and there was some analysis done, but it is difficult to predict the impact on
those 1,100 students. Why would you go
ahead and eliminate the program if you did not know what the impact was going
to be on the students? Why was the
analysis not done first rather than after the fact?
Mr. Gilleshammer: Mr. Acting Deputy Chairperson, what I have
said to the member is that there are a number of options that they can
exercise, and when they have not made those decisions themselves, it is
difficult for us to put them into particular decision‑making categories.
However, I have explained to the member
before that this was a program that did not exist anywhere else in the country,
and in downsizing some of the efforts that the department was responsible for,
it was one of the very difficult decisions we had to make. I know that the Premier and the Minister of
Finance (Mr. Manness) and the Minister of Health (Mr. Orchard) in
Mr. Martindale: The minister has repeatedly said that the
student social allowances program does not exist in other provinces, as if that
is some sort of rationale for eliminating it in
I presume the student social allowances
program was a good program. It was very
much appreciated by the students. We
certainly heard that when talking to the students. They are very distraught that the program is
being eliminated and do not know what is in the future for them. The minister has repeatedly said that some of
them can go home. Many of them said they
could not go home, because they came from abusive families. So I would still like to know what the rationale
was, because I do not buy some of the rationales that this minister has given,
particularly the one that it does not exist in other provinces.
Mr. Gilleshammer: I may be able to find a quotation here that
is apropos from Roy Romanow, and it is about deficits and debt and government's
ability to sustain programs. This is
what we are talking about‑‑the ability of government to sustain
programs. He said: For a New Democrat who is used to being in
government when the economy is expanding and who is used to redistributing
wealth, the change to creating wealth and to taking back concessions given to
people in better times is so darn difficult.
We are faced with somewhat of the same
situation, that as government and we look at our debt and our deficit, there
are programs that we cannot sustain and, unfortunately, this was one of them.
Mrs. Sharon Carstairs
(Leader of the Second Opposition): Mr.
Acting Deputy Chairperson, can the minister tell us just what program analysis
and assessment was done by this department this year?
The Acting Deputy
Chairperson (Mr. McAlpine): Excuse
me, could you pull your mike up, please.
Mrs. Carstairs: Can the minister tell us what program
analysis and assessment was done by this department this year?
Mr. Gilleshammer: Earlier this evening, I read into the record
some of the Activity Identification associated with Policy and Planning and it
is in the record. I might just be a
little more specific with a couple of other initiatives and one of the things
we did was to co‑ordinate the drafting of a new vulnerable persons living
with a mental disability act and a tremendous amount of time has been spent on
that particular piece of legislation. We
co‑ordinated some departmental legislative proposals where we have
consequential amendments to various acts, provided support for the creation of
the International Year of the Family Secretariat, prepared environmental
assessment and departmental overview for strategic planning.
Again, one of the points I mentioned
earlier, this particular branch is very much involved with the cost‑sharing
arrangements with the federal government under CAP and VRDP. As well, the branch works on co‑ordinating
and preparing briefing material for use at the Estimates process that we are
now participating in. I might just as an
aside want to wish the member a happy birthday.
Mrs. Carstairs: Well, thank you, but I was not asking about
the policy research and analysis, nor was I asking about federal‑provincial
cost sharing. I was specifically asking
about that section, and it is reported in your annual report on program
analysis and evaluation. I want to know
which programs were evaluated, which programs were assessed in the year 1992‑93.
Mr. Gilleshammer: Mr. Acting Deputy Chairperson, there was some
detailed analysis of the Human Resource Opportunity Program and the Human
Resource Opportunity Centres as well as the Employability Enhancement Programs.
Mrs. Carstairs: Surely the assessment of employability
indicated that there was a direct relationship between the educational level of
those seeking employment and their actual success in job search.
Mr. Gilleshammer: Yes, a higher level of education and higher
skill levels usually puts those individuals in a better position to move into
the world of work.
Mrs. Carstairs: By having done that particular type of
evaluation with regard to employability and recognizing that there was a direct
correlation between employability and level of education skill, why did this
government choose to cut student social allowances?
Mr. Gilleshammer: Well, one of the things that we did in recent
weeks was to move all of the training programs under the umbrella of the
Department of Education. That meant
moving about $12 million worth of programming from Family Services and other
programming from the Department of Labour so that that particular department,
the Department of Education, could focus on job training, on education, and on
the specific training that is required by individuals to access employment.
The Department of Education now offers or
is responsible for the full continuum of programming that exists in government,
whether it is at the high school level or whether it is at the community
college level and as well is responsible for the programming that was formerly
in this department.
Mrs.
Carstairs: Well, this is not
Education Estimates, but it is clear from a detailed analysis of the Education
budget that in fact these areas have been cut.
So presumably, no new dollars went from the Department of Family Services
into the Department of Education with this letting loose, if you will, of some
responsibility.
(Mr. Deputy Chairperson in the Chair)
* (2040)
Mr. Gilleshammer: We transferred within that budget that I have
referenced approximately 150 staff to Education, which were responsible for the
Gateway program, the HROCs and HROPs, the single‑parent job access, and
the youth programs that were part of Family Services, so those have all been
transferred to the Department of Education.
That includes the contract staff that were part of this function as
well.
Mrs. Carstairs: Can the minister put a dollar value then on
the cost of transferring these kinds of staff to the Department of Education?
Mr. Gilleshammer: The transfer to the Department of Education was
not a relocation of them, so there was not a cost to that. They have been
reassigned to the Department of Education.
Mrs. Carstairs: Well, then, why does it not show a decrease
of 150 staff years in your budget?
Mr. Gilleshammer: Mr. Deputy Chairperson, we transferred some
$15 million to Education and Training that was part of this department last
year. I am told that the staffing does
not show up on here, but that we did transfer some 150 staff years.
The 150 staff refers to staff years,
refers to a number of contracted staff as well, but that function, that budget
has been transferred to Education.
Mrs. Carstairs: If you look at Chart 7 of your Detailed
Estimates, it shows that you had a staff of 1621 in 1992‑93; for '93‑94,
you have 1602, which is a staff‑year deduction of 19. What has happened
to the other 131 people?
Mr. Gilleshammer: What page are you on?
Mrs. Carstairs: Family Services Five‑Year Staffing
History, Total Department, page 89.
Mr. Gilleshammer: I am told that the staffing has been
retroactively adjusted. The staffing
levels for previous years have been retroactively adjusted, but those transfers
have taken place.
Mrs. Carstairs: Well, if the staff years have taken place,
where is the $50 million? You say you
have transferred it to Education. Your
budget shows a 4.5 percent increase. If
you have also lost another $50 million, would that not show‑‑
Mr. Gilleshammer: $15 million.
Mrs. Carstairs: $15 million.
Would that not show an increase in your budget of even more than 4.5
percent?
Mr. Gilleshammer: If I can refer you to page 53 of the budget
book, the printed Estimates, the bottom of the page shows a transfer of
functions to Education and Training of $15,512,300. That money is taken out of
our department for this year and also is taken out of the spending Estimates
for last year, for 1992‑93, to show a more accurate comparison between
this year's budget and last year's budget.
Mrs. Carstairs: Then, when I look at Schedule 3, page 8, and
I see $628 million, and I see $657 million for this year, I am to presume that
$15 million has been taken out of both $628 million and $657 million?
Mr. Gilleshammer: That is correct.
Mrs. Carstairs: It will be interesting to now look at the
Department of Education and find out where this wonderful $15 million has
appeared.
In terms of the student social allowances
program, if, in fact, there has been some record, some analysis done with
regard to employability, what impact do this government and this minister
believe there will be as a result of denying 1,200 students the ability to go
to school in terms of their employability?
Mr. Gilleshammer: As I have indicated earlier to the critic of
the NDP, there are a number of options that students who are currently in the
program will have to make. Some of them
will be graduating; some will seek part‑time employment and attend school
part‑time; some will seek full‑time employment and attend school at
night or by correspondence; some will rely on family support to continue their
education; others will explore mature‑student status for post‑secondary
programs; some will take the GED high school equivalency test.
So I readily admit that this is a program
that is going to be eliminated. The
1,100 students who are currently in the program will fall into a number of
categories, but as I just indicated to the critic from the first opposition
party, it is a program that we felt we could no longer sustain, given the
budgetary pressures that we have at this time.
Mrs. Carstairs: Can the minister tell me what analysis was
done of those 1,100 and where they had come from? Had they been previously employed? Had they been previously on social
assistance? What is the demographics of
that group of 1,100?
Mr. Gilleshammer: The profile of that group of 1,100 students
is that the vast majority of them are between the ages of 18 and 24 years of
age. About 70 percent of them, I
believe, are currently in the city of
* (2050)
Mrs. Carstairs: Well, what it did not give me was their
status at the time that they were accepted into student social allowance. Were they on social assistance? Were they working? Were they allowed to, for
example, leave a job and go on student social assistance? Were they unemployed? There must have been some reason for their
acceptance into the student social allowance program. What was that reason or reasons?
Mr. Gilleshammer: The guidelines for accepting them are that
they have no other source of income, that they have a good educational plan
that is acceptable to the program, that they are prepared to make a commitment
to pursue their education. Because most
of them, if not all of them, have left education prematurely, some of those
reasons reappear, and we do have a dropout rate in that program during the
course of the school year.
At one time, I think at the beginning of
September, there were something like 1,500 or 1,600 who enrolled, and at the
present time, it is down under 1,100.
Mrs. Carstairs: If the minister knows that approximately 400
dropped out of the program, can he tell us what happened to those 400? Did they go into the employment market, or
did they in fact go on the regular social assistance?
Mr. Gilleshammer: A variety of things have happened to them.
Some of them have found part‑time work; some have found full‑time
work; some have moved out of province; some have gone on full‑time social
allowance.
Mrs. Carstairs: What is the percentage of those who have gone
on full‑time social allowance?
Mr. Gilleshammer: We do not have a number for you here tonight.
Most of them would be accessing municipal social allowances, and that would be
information we would have to get from the city.
We do have some information, and perhaps I can bring something back for
the member.
Mrs. Carstairs: What is the projection of this minister of
those numbers increasing in social assistance as a result of this program having
been cut, in other words, not this specific 1,100, but the 1,100 that would
have been considered eligible come September?
Where will those 1,100 be next year?
How many of them, according to this department's analysis, will move
just from social allowance to social assistance?
Mr. Gilleshammer: Again, as I had indicated to the other
critic, in many cases, those decisions have not been made yet, until they come
to the end of their school year. We are
anticipating that some of them will achieve part‑time employment and
continue their education at night. Some
of them will find full‑time employment; some will rely on family
support. Some will do the high school
equivalency.
I expect, of that 1,100, some of them will
access for a period of time the municipal social assistance, but to give any
accuracy to projections we have about what their intentions will be and what
they actually do come September is difficult to say.
Mrs. Carstairs: I specifically said I was not addressing the
1,100 who have been in the program this year.
Every year, presumably, you found 1,100 to 1,500 young people, primarily
between the ages of 18 and 24, who had no other source of income, and you put
them into this program. There is no
indication that I have, with employment rates, that you will not have the same
1,100 to 1,500 young people, 80 percent between the ages of 18 and 24, who will
have no other source of income, who will have to turn to social
assistance. So, when you did your
projections for how your budget would have to increase in social assistance,
how many of these young people did you budget for?
Mr. Gilleshammer: The 1,100 or 1,500 that would have accessed
the program next year would include part of the group that is currently in the
program, because they are not going to finish their programming all in the same
year. Our social allowance budget is
available on demand, and we make projections within that budget to try and
accommodate what the projected demand is, both at the provincial level and the
municipal level.
At the municipal level, it is nearly
impossible to say how many of these are going to fall into that category, but
we do know that our provincial component has been increasing at about 2 percent
or 3 percent a year. At the municipal
level, we have factored in an increase in municipal allowance for next year of
about 9 percent to 10 percent.
Mrs. Carstairs: I find it difficult to believe that the
department, in formulating a budget on social assistance, knowing that they are
cutting 1,100 people from a program, have not budgeted for a certain
percentage, if not all of those people, to have moved into their figures for
social assistance.
Mr. Gilleshammer: The reason for that is, all of them are not
going to be on social assistance. Some
will be in the world of work, some will be working part time and going to
school part time. We have made
projections about what the caseload growth at the municipal level is going to
be, and we have increased our income security in that area by about 10 percent.
Mrs. Carstairs: So you are anticipating that many of these
young people will turn to municipal assistance.
Mr. Gilleshammer: No, that is not the only source of clients
that the municipal rolls have. We have
other people who access the municipal program who are new to perhaps the city
of
Mrs. Carstairs: Can the minister tell this committee what
cost differentiation there is between a young person collecting student social
allowance and that same young person going on either municipal or provincial
assistance?
Mr. Gilleshammer: The cost per individual case is essentially
the same for a single person who is accessing the system, but if they are on
student social allowance historically they have stayed on the system longer.
* (2100)
Mrs. Carstairs: Mr. Deputy Chairperson, can the minister tell
me what analysis was done of those parents receiving subsidies and being
charged $1 a day, an increase now to $2.40 a day? How many of those were actually paying that
dollar a day to the child‑care centre?
Mr. Gilleshammer: That is information that is lodged in the
daycare centre. Some centres charged the
dollar a day. Some centres did not
charge the dollar a day. Some centres
made individual provision for some of their clients. They had the ability to charge that dollar a
day. Some centres did, some did not and
some centres did both.
Mrs. Carstairs: Well, the information that I have from many
of the child‑care centres was that they technically charged the dollar a
day, but many of the people could not pay the dollar a day. It was not that they would not have taken it
if they could have got it. It simply was
not in the capacity of those individuals to pay the dollar a day. Does this minister have no figures whatsoever
on that capacity to pay, and if he did not under what basis did he increase it
to $2.40 a day?
Mr. Gilleshammer: The individual decision to charge the dollar
a day or not charge the dollar a day or charge it to some people and not to
others was made within that centre.
(Mr. Jack Reimer, Acting Deputy
Chairperson, in the Chair)
The board and the administration of that
centre made the decision about what charges they were going to pass on to the
parent, and they did so in consultation with that parent. That is information that all the centres did
not share with the department.
Mrs. Carstairs: Did the minister, through his policy analysis
section of this department, not seek out that information before he increased
it by, what, 150 percent?
Mr. Gilleshammer: Well it is information that some centres
share with us and some centres do not share regarding their individual
budgets. We know that with the
additional cost the centres are basically following the same strategy. They have the ability to levy that if they
wish. In some cases they choose not to
do it, and in some cases they make individual arrangements with that particular
family.
Mrs. Carstairs: Were there no calls, contacts made by this
department which has the role to establish a policy for this government to
investigate whether there was any capacity on the part of parents receiving
subsidies to pay a 150 percent increase?
Mr. Gilleshammer: We meet regularly with the daycare groups
that represent the centres, that represent the private sector and that represent
the home‑based daycare, and deal with a variety of issues and certainly
we talk about the funding that they receive.
We have been fully subsidizing for spaces to the tune of $17.40. We have dropped that subsidy down to $16 and
allowed the centre to make a decision if they are going to charge that through
to the parent or not. It was felt that
this was a minimal amount of money that most centres could pass on to the
subsidized clients, many of them paying a partial subsidy. Again, it was a way
of preserving the system where we have almost 19,000 spaces and over half of
those currently subsidized.
Mrs. Carstairs: The minister says it is a minimal amount of
money, but how did he make that decision?
I mean, if there was no contact specifically with the child‑care
givers to find out how many of their people simply could not pay, how did he
make the decision that it was a minimal amount of money?
I have child‑care centres phoning me
who tell me that they are going to have to give up some of these children
simply because they have families with two children, that they cannot pay an
additional $4.80 a day per child. They
simply do not have the money.
Mr. Gilleshammer: Well, the member misunderstood my answer
then. I said that we meet regularly with
the child‑care givers. That is the MCCA, the Family Day Care Association
and also the private centres. We talk
about a range of issues, a lot of it to do with funding. So we have regular contact with them, and
they have quarterly meetings with the MCCA and my senior staff.
I have met with any and all of those
groups as often as they have wanted to meet.
I have indicated to the member that certainly we have talked about
rates; we have talked about the budgets that centres and homes and the private centres
have. We have talked about all of these
funding issues.
It was the judgment of the department that
we could levy an additional cost or, if you want to put it another way, flow a
lesser amount of subsidy to those fully subsidized people and also the
partially subsidized ones to maintain the amount of money that we have in the
system at this time and allow for the continuance of over 19,000 spaces, and
have lowered the subsidized children in care from 10,000 to 9,600.
Mrs. Carstairs: I do not dispute that the minister has met
with these groups but the minister, just a few minutes ago on the record, said
that no analysis was done by his department to indicate whether or not those
that would be asked to pay this additional $1.40, that their capacity was ever
analyzed.
So how can a decision be made without even
undertaking a brief analysis to find out from child‑care centres how many
people can pay the dollar a day, how many are not paying because they simply
cannot afford to pay, and what the implication is going to be on them of being
asked to pay $2.40? Surely, that is the
function of this Policy branch.
Mr. Gilleshammer: I was responding to the fact that the member
said that we have not met with and discussed financial arrangements with the
child care‑‑
Point of
Order
Mrs. Carstairs: A point of order. There is no way that I put on the record that
this minister had not met with these groups‑‑no way.
The Acting Deputy
Chairperson (Mr. Reimer): The member did not
have a point of order. It was clearly a
dispute over the fact.
* * *
Mr. Gilleshammer: I am indicating, in our meetings with the
child‑care givers that the member referenced, we have talked about
funding, we have talked about the daily cost of care, we have talked about the
subsidies that flow to the families who access daycare. After having discussions with that community,
after having met with departmental staff and having arrived at the stage where
we are making decisions on how we can maintain the system, maintain the number
of spaces that are currently licensed and maintain a reasonable subsidy level,
one of the ways of reducing our costs from being overspent in the last budget
was to, first of all, freeze new spaces and, secondly, to put a cap on the
subsidies at 9,600.
We realize that this may well present some
transitional problems to the centres, but we felt that $1.40 was a minimal
amount for a family to contribute in addition to what they were contributing
before. I can assure the member that a
lot of work went into this prior to the decision being made.
* (2110)
Ms. Becky Barrett (
The minister stated that two of the
elements that needed to go into an individual being able to access the student
social allowances program were that they had no other source of income and they
had an education plan. Also, it seems as
though, if you had about 1,500 students at the beginning of the year and now
just under 1,100 finishing up the year, for a program in this department, in
this division, this is a very low dropout rate, comparatively speaking. So it would appear to me that the students
who made use of the student social allowances program were, in a sense‑‑to
use a phrase that I probably should not use‑‑the cream of the
crop. They are the people who are the
most committed, who are the most motivated, who have obviously a connection to
the program, given the dropout rate.
Given all of those kinds of things, it
would appear to me that this is a very successful program. I am wondering what the cost‑benefit
analysis, if there was one done, given the fact that there is no difference in
a year's support for an individual on the student social allowances program as
related to a year's support on social assistance. If these are as motivated individuals as it
would appear that they have been, why would a program that seems to be so
successful be eliminated?
Mr. Gilleshammer: Mr. Acting Deputy Chairperson, I think we
have covered this ground before. It is
one of the very tough decisions, which your Leader has referenced on a number
of occasions, that governments have to make when we are in a situation of
declining revenues, increasing deficits and a high debt load.
The program, as I have indicated, is one
that did not exist anywhere else in
That would have been a different
environment, and perhaps an environment where a program like this could have
been maintained. The fact of the matter
is that we had to make very, very difficult decisions. This was one of them.
I have indicated there are a number of
options for these students, that some of them will continue their education on
a part‑time basis, some will be graduating. For those who cease their education and find
employment, they will pursue that path.
If they cannot find employment then they
may well be accessing municipal social allowances for a period of time. But at the same time, they will be looking
for work or the municipalities also have the ability to write into their by‑laws
a by‑law such that they may permit, on a part‑time basis, students
to be pursuing their education.
Ms. Barrett: The minister has stated at least three times
this evening and several times in earlier discussions in the House and
elsewhere about these options that these individuals have.
Theoretically perhaps they are options for
people, but in reality, given the unemployment rate for the 18‑ to 24‑year‑old
age group in our province, given the fact that many of these people‑‑although
the minister did not give us a figure, and I would like to ask what the
percentage is‑‑many of these individuals on student social
allowance have children.
Given the fact that for those people on
student social assistance, or the children who are now going to have to try and
find a job, they are not going to be able to access subsidized daycare spaces
because those subsidized daycare spaces are, according to the minister's own
statements in the House, going to have a wait list attached to them; given the
fact that the jobs that we have in this province, we are losing the high‑paying
jobs and we are getting the lower‑paying jobs; and given the fact that
these students do not even have the basic educational qualifications if they do
not complete this program to be able to access whatever jobs there are
available, how can the minister state to the House and to the people of
When the minister says to those students
on the front steps of the Legislature that they can do what he did which was
stay at home and work part time while he got his university degree, I would
suggest to the minister that for those 1,100 students, that is really living in
technicolor. They do not have those
options available to them. Obviously
they do not have those options available to them or they would not have been
able to access the program in the first place.
How he can say that this is anything other
than a punitive measure instituted on the backs of these individuals is beyond
me, particularly when the costs to the system are marginal at best, seeing as
how the number of these students who will be going on social allowance is
probably going to be very extreme? It is going to be a very high percentage
because those other options are just not real for these people.
(Mr. Deputy Chairperson in the Chair)
So there is very little cost benefit in
that context. Taking a little longer
view, if these students actually do graduate and get their high school diploma
or they get their university degree, they are much less likely to have to
access the social assistance system either immediately or in their future.
Therefore the cost‑benefit analysis, even on a two‑year, long‑term
strategy is very beneficial towards keeping this program in place.
I just do not understand the minister's
rationale. I would like to just put on
record the fact that the options he references are not available to these
individuals.
Mr. Gilleshammer: Much of what the member said just now I
reject, and I would tell you that I was not giving that advice on the steps of
the Legislature. I was asked a very
specific question. [interjection] No, that is not correct. The member I think was there and does not
have a good recollection of it. Somebody asked me what I did when I was a
student, and I told them. I was not
giving anybody advice. But I can tell
you that if the governments, during the 1970s and 1980s, had not spent far in
excess of revenue coming into government in those years, there would be much
more latitude today to sustain programming and to create new programming than
we have.
We simply are now having to pay for what
happened in the 1970s and 1980s, and it is a long time since this province had
a balanced budget. We are severely
impacted by the debt load, as I have indicated, and by the deficit. That is no different than most other
governments across this country.
I am sure Bob Rae does not want to lay off
4,500 Hydro workers, but they are doing it.
He does not want to send 12,000 out of the workforce who are civil
servants, but they have to do it. These
are the tough decisions. Roy Romanow did
not want to close 52 hospitals, but because of the deficit we no longer have
that ability to create new programming and we do not have the ability to
sustain the programming that we had during the '70s and '80s. That is why these tough decisions are being
made.
The member, I think, has to come to grips
with that to understand why tough decisions are being made. She shakes her head, and I am sure she is a
proponent of that school that says, do not worry about the debt, do not worry
about the deficit. This is a rich country.
We can spend more money and tax more.
I can tell you that Manitobans are taxed
to the hilt, and we are putting so much of our expenditures now to pay for past
expenditures. The fourth largest
department in government now is the Department of Finance as they pay for that
long‑term debt.
* (2120)
The member says that there are no
options. That is not true. Those people who are accessing this program
do have options, options which they will exercise. I point out to her that 90 percent of them on
this caseload are single. I mentioned
that before and I mention it again because she refuted that 90 percent of these
people are single. [interjection]
The member said, a lot of these students
had children. That is not true.
[interjection] Well, the member was not asking, she was making a
statement. And they have options; they
can seek part‑time employment and continue school part time. Many, many people have done that, and that is
an option.
They can seek full‑time employment
and attend night school. That is an option.
Some of them will return to family and rely on family resources as they
continue their education, so do not tell us in this committee that they have no
options. They certainly do. I grant you that their options may not be as
widespread as other people who have more affluent means, but there are options,
and they will make those decisions.
But, again, this is a program that only
existed because these people wanted to be students and they had no other
income. They have options‑‑options
that students in other provinces explore. To give definitive answers on what
they will do at this time is impossible, but they have a number of options, and
they will exercise them.
Ms. Barrett: I will not belabour this point anymore except
to make a comment that the government is preparing, according to notes that I have
just taken, that the minister stated earlier this evening, that there will be a
9 to 10 percent increase in the provincial government's support to
municipalities for social assistance payments and either a 2 to 3 percent
increase, and maybe even more this year, in the government's own provincial
social assistance rates.
Now, that is an enormous admission of
failure of this government, it seems to me, to recognize the fact that in order
for these increases to be decreased, there needs to be programs, like the
student social allowances, which allow people the opportunity to get out of
that cycle instead of continuing to perpetuate it.
I am suggesting that hard economics could
very easily lead one to believe that a program like this is beneficial and should
be maintained so that there can be a reduction as early as next year in at
least the increase in student social allowances payments, if not an actual
decrease in the numbers.
Mr. Gilleshammer: If you think this government is admitting
failure, I would say to you that we are recognizing the reality that exists,
that there is unemployment.
But what the member is saying is that we
should not recognize that reality, we should not budget for the fact that in
this coming budget year we expect there will be some increase in the number of
people on social allowances. I just met
with a colleague from
Mr. Martindale: Mr. Deputy Chairperson, I noticed that when
the minister answered a question about what kinds of activities the Policy and
Planning did that he mentioned the International Year of the Family Secretariat. It is my understanding that 1994 is the
International Year of the Family. Is
that correct?
Mr. Gilleshammer: That is correct.
Mr. Martindale: Is it also correct that two staff years have
been assigned to work on the International Year of the Family?
Mr. Gilleshammer: Two people have been assigned from our
department to work on that.
Mr. Martindale: And one of those people is a former member of
your political staff?
Mr. Gilleshammer: That is correct.
Mr. Martindale: Are there plans to add any more staff?
Mr. Gilleshammer: We may be doing that.
Mr. Martindale: Could the minister tell us if Policy and
Planning did any analysis or made any recommendations about the International
Year of Indigenous People which I believe is this year?
Mr. Gilleshammer: We did not within this department. I am not sure whether other departments
perhaps did that work.
Mr. Martindale: Okay, well, I guess we will have to ask in
Northern Affairs and Native Affairs the same questions.
I have a letter, copies of which I would
like to distribute to members on the committee.
I think it is easier to have the questions answered if the minister can
see the letter. It is not addressed to
him, but I am really wanting to concentrate on the contents, not on the fact
that it is addressed to a minister who is here tonight. It has to do with your department and single
mothers transitioning off social allowances.
I hope there is a copy for the Minister responsible for the Status of
Women (Mrs. Mitchelson).
In this letter it refers to the Single‑Parent
Families Report of 1990 and revisions to the social allowance program to
eliminate program‑generated barriers to training and long‑time
employment. I guess my first question
has to do with the first paragraph on page two.
Has there been a change to assistance in the year after they gain
employment by continuing health benefits, et cetera?
Mr. Gilleshammer: Well, we announced that certain categories of
clients would be able to retain their health card for up to a year as they
transition into the world of work.
Mr. Martindale: The recommendation apparently was that former
clients be allowed to maintain social allowance benefits until their wage
equals the Statistics Canada poverty line.
I believe that is a quote from the Single‑Parent Families
Report. Has there been any analysis of,
say, the cost of a system if single parents did that? What is the position of the minister on that
recommendation?
Mr. Gilleshammer: We think we have made a major step by
allowing the clients, whether they are single parents or the disabled, to
maintain that card for up to a year with certain income thresholds. But, if the member is asking that we allow
recipients to maintain that health card for as long as they wish, or until
their salary reaches a certain stage, that is a step further than we have
indicated in our announcement on this particular initiative.
* (2130)
Mr. Martindale: I would like to refer the minister to the
second last paragraph which says: The
department's interpretation could lead to the following. One young mother leaves social allowance for
employment and keeps her health benefits for a year; another single mother
leaves social allowance for training and lives for six months on less money
than the first mother while being denied health benefits. I am certain you would not regard this as
fair or just.
Is there a difference between leaving
social allowance for employment and leaving social allowance for training in
terms of benefits that former recipients are allowed to keep?
Mr. Gilleshammer: Many of the single mothers that took training
maintained their social allowance while they were taking that training, whether
it was in the COPE program or the single‑parent job training, so while
they retained their social allowances, they also retained their health
card. What is new here is that the
individuals who are leaving social allowances to go to work, and who normally
would have lost their health card when they accessed that job, now have the
ability to keep that card for up to a year.
It is an initiative that other provinces
are looking at. I think B.C. is very
interested and asked some questions on this. It is too early for us to have any
data of how successful this is, but certainly from Policy and Planning and from
the community, from the department, there was a feeling that there were people
who were offered employment or could access employment who were making the
decision not to take that employment because they were going to lose their
health card. As a result, we think that
this is very positive move. In fact, it
has been not only hailed by ministers from other provinces, but I think
generally well accepted here in
Mr. Martindale: For clarification then, if recipients go to
work, they can keep their health card for one year. It they take training, some continue to keep
their health card, and some do not.
Perhaps the minister could clarify the training for me.
Mr. Gilleshammer: If the training was part of the programming
that was formerly offered within the Department of Family Services and that
training was part of the programs I referenced, they continue to be on social
allowances and they continue to have their health card. This program is targeted to the single
mothers who are on the provincial system and to the disabled who are on the
provincial system who have an opportunity to access work. To encourage them to move in that direction,
we have allowed them to keep that card up to a year or up to a certain wage
level, and we hope that this will be an incentive for more of those clients to
enter into the world of work.
Mr. Martindale: I guess that brings us to the fundamental
point that the author of this letter, Linda Taylor, the program manager of
Resources for Adolescent Parents at Children's Home, was trying to make, and
that is, she implies that it is not fair or just that social assistance
recipients going to work can keep their health card but not all of those who
are entering training can. So I guess my
question for the minister is, why can all single mothers receiving social
assistance for training not keep the health card or not be eligible for the
same benefit?
Mr. Gilleshammer: What the member is asking us to do is expand
the use of this concept that recipients as they leave social allowances
maintain their health card. Now the
member must know that there is a cost to this, and from the luxury of
opposition it is easy to ask for the expansion of programming and the expansion
of costs. We are targeting this at the
moment to two groups of people. It is an
experiment that we hope is going to work.
We need some time to analyze that data, and perhaps a year from now you
could ask the Minister of Family Services how successful that has been. She, I am sure, will be able to provide you
with the statistics at that time.
Mr. Martindale: Could the minister tell us how much has been
budgeted or if an analysis has been done on a projected cost of allowing former
recipients who go to work to keep their health card?
Mr. Gilleshammer: We do not have that information this evening.
Perhaps, if we could come back and have you ask that question when we are under
that portion of the budget, I could give you an answer. I will attempt to bring it back next day.
Mr. Deputy Chairperson: Item 1.(5) Policy and Planning (a) Salaries
$762,000‑‑pass; (b) Other Expenditures $329,100‑‑pass.
1.(6) Internal Audit (a) Salaries
$251,400.
Mr. Martindale: Mr. Deputy Chairperson, under Expected
Results, it says: "The review of
all major programs, functions and systems over an audit cycle of five
years." I wonder if the minister
could tell us which programs have been audited in the past year.
Mr. Gilleshammer: If I could just come back to that in a minute
while we are getting some of that data, I do have the information on the
extension of Social Allowances Health Services benefits. We are anticipating
about 500 of our long‑term cases will benefit from this initiative, and
the estimated cost is $300,000.
The question that the member is asking,
what specific branches or programs have been audited during 1992‑93? Scheduled and completed are the following
eight: Residential Care Licensing
branch, social allowances program directorate, Children's Special Services,
Special Employment Programs, Westman regional office, Selkirk social allowances
program district office, Winnipeg South social allowances program district
office, and the Family Dispute Services.
Scheduled and in process are two:
the Information Systems branch and the Community Living Program.
There are a couple of others that are
being looked at at the present time.
Mr.
Martindale: Could the minister tell
us what a program audit consists of?
What sort of evaluation is carried out that is included in a program
audit?
Mr.
Gilleshammer: Under Activity
Identification they undertake audit reviews and assessments in the areas of,
first of all: "the design, development, implementation and operation of
financial, managerial and operational systems, policies and practices, processes
and controls including computer‑based systems."
Have you already got that?
An Honourable Member: Yes, we can read this.
Mr. Gilleshammer: The Activity Identification covers it.
Mr. Martindale: Could the minister tell us if there is any
particular reason for doing an audit of social assistance offices or income
security offices by region. I think the
minister referred to Selkirk and Winnipeg South and other areas.
Mr. Gilleshammer: The audits are done office by office to see
that they are complying with the legislation, with the procedures that are in
place. As a result, a number of offices
are done on an annual basis to see that they are consistently applying the
regulations in that particular office.
Mr. Martindale: Are the results of the audits used for
internal purposes only, or are recommendations made to the minister about
proposed changes resulting from the audit?
* (2140)
Mr. Gilleshammer: They are primarily used internally to improve
efficiency and effectiveness.
Mr. Martindale: Were any of the list of items read into the
record by the minister of the kind under the Activity Identification, special
reviews? The second last Activity
Identification which says, "Conducts special management‑directed
reviews encompassing a wide range of issues . . . ."
Mr. Gilleshammer: All of the ones that I read into the record
earlier were regularly scheduled audits.
There were two that were directed by management. One was the management of client personal
funds, and the second was a specific agency review on a specific issue at Ikwe.
Mr. Martindale: Is the minister able to share any of that
information with committee, or is it considered confidential?
Mr. Gilleshammer: Are you referring to all of these?
Mr. Martindale: I am referring to the two that you just
mentioned.
Mr. Gilleshammer: I am told that these are viewed as internal
procedures.
Mr. Martindale: Could I ask‑‑not could I, will
I? I will ask. Was there a reason why
management directed an audit of the use of client personal funds? Was there something that triggered that
audit, and if so, could the minister tell us what it was?
Mr. Gilleshammer: Mr. Deputy Chairperson, we are participants
on this committee, along with staff from Justice, from Health and the Public
Trustee's office, to establish programs and policies and practices in regard to
trust accounts. It is primarily related
to adults under the Community Living portion of our department.
Mr. Martindale: Could the minister tell us what the reason
was for an audit of the Family Dispute section?
Mr. Gilleshammer: That was part of the regularly scheduled
audits that take place on a five‑year rotational basis.
Mr. Martindale: Were there any recommendations coming out of
the audit of Family Disputes?
Mr. Gilleshammer: I indicated earlier that this was an internal
audit to improve efficiency and effectiveness within that branch of the
department. I am told, on a regular
basis, there will be recommendations coming forward on all of these audits.
Mr. Martindale: I presume the recommendations are to the
minister?
Mr. Gilleshammer: No, these are recommendations to the managers
who can make changes within the programs to make them more effective and more
efficient.
Mr. Martindale: Can the minister share any of these
recommendations with the committee?
Mr. Gilleshammer: Well, the recommendations will cover a broad
spectrum of activities that the department is involved in. I suppose it is an opportunity for one area
of the department to learn from the practices and procedures of another area of
the department, and the recommendations that are brought forward at the
management level can be shared with those offices.
In many cases, the offices reference‑‑the
programs referenced provide a broad cross section of work, but that same work
is being done in other areas of the province, in other offices, in other
regions. If there are practices there
that have proven to be feasible or proven to be beneficial, they can be perhaps
emulated somewhere else, but it does provide a level of assurance about
departmental operations: the adequacy of
systems and procedures; the comprehensiveness of policies and operating
guidelines; the reliability and adequacy of management information; the
protection of public funds and public assets; the extent of compliance with
legislative, central agency and departmental directions. So these program audits have a wide variety
of information that they can bring forward.
Mr. Martindale: Mr. Deputy Chairperson, I think I am almost
finished this page. One what I hope is a
final question‑‑I noticed that the total subappropriation has
declined year over year by approximately 33 percent. I hope my calculations are correct, or would
$90,000 be more accurate? But a question
based on that: Does the department plan
to carry out the same number and quality of audits with fewer staff? Obviously the number of staff years is down,
which according to the footnote reflects the workforce adjustments.
* (2150)
Mr. Gilleshammer: The level of and number of audits will
continue based on the availability of time.
There is a workforce readjustment that is taking place, and we may have
to change in part the cycle on which we do these audits but by and large are
comfortable that the internal audits will take place.
Mr. Deputy Chairperson: 1.(6) Internal Audit (a) Salaries $251,400‑‑pass;
(b) Other Expenditures $24,900‑‑pass.
1.(7) Agency Relations Bureau (a) Salaries
$201,100.
Mr. Martindale: Mr. Deputy Chairperson, could the minister
tell us if under Activity Identification, which says, establishes purchase of
service principles, if contracts with external agencies are what is part of
purchase of service, is that the same thing, contracts between your department
and external agencies and purchase of service?
Mr. Gilleshammer: Yes, this is referring to the funding and
service agreements that we have negotiated and are negotiating with a number of
groups.
Mr. Martindale: I would like to use as an example the
Manitoba Foster Family Association because, along with correspondence to
yourself, they sent copies of their correspondence to the opposition critics,
and they sent us a copy of their contract with your department.
My understanding is that they spent a
considerable amount of time negotiating this contract. It is dated January 11, 1993, the draft that
I was sent. It is called the Memorandum
of Agreement. My understanding is that
they negotiated this in good faith, and as far as I know, your department
negotiated this in good faith. Then very
suddenly, at the last minute, they no longer have a Memorandum of Agreement;
they no longer have funding with your department.
So I would like to ask the minister if
this is the only agreement that was not entered into or whether this was the
same experience with other external agencies, that they negotiated in good
faith service contracts or Memorandums of Agreement with your department and
also if your department negotiated in good faith agreements with them only to
find at the end of the day that there was no agreement.
Mr. Gilleshammer: Mr. Deputy Chairperson, we have negotiated a
number of these agreements with organizations where we are the major
funder. Certainly in reference to the
Manitoba Foster Family Association, there were discussions at the officials level
on service and funding agreement. The
member is correct, that decisions which were made in the budget went beyond the
service and funding agreement and, as a result of budget decisions, we of
course terminated any discussions.
Mr. Martindale: The minister has repeatedly said during
Estimates that the Estimates procedure for his department is a very long
procedure and that it starts in the early fall and takes quite a few months to
complete.
If that is the case, because I think the
minister implies that many of those decisions were made early in the game, but
the notification of the agencies came very, very late in the budget process,
why, as a minister and as a government, could you not have said to those
agencies, we have to reduce our deficit and you should make other plans and
give them time to find alternative sources of funding, whether it is fees that
they assess on their own members or whatever method it is rather than going
through a long and protracted process of negotiations, apparently in good
faith, and then abrogating the agreement or at least not signing it, not going
through with it, giving organizations like the Manitoba Foster Family
Association very short notice in order to make other arrangements.
The result has been in a number of cases
that organizations have had to lay off their entire staff. This has caused great turmoil for these
organizations, which have boards, but their boards are volunteers working very
hard on their behalf and they are left with a crisis situation to make
alternative arrangements. Why could you
not have done it some other way?
Mr. Gilleshammer: Well, the member is not being fair and honest
when he says that I have implied that decisions were made early in the
fall. I responded to a question that the
member raised last week when he said that decisions were made at the last
moment, and I said in fact that discussions on the budget started last August,
and that is correct.
Now, if the member has inferred from that
that decisions were made last August, he is wrong. We did not conduct negotiations and
discussions with groups during the fall months and the winter months knowing
all that time that a decision had been made. Those decisions on the budget are
made in the weeks and perhaps a number of weeks prior to the budget being
finalized. Until those budget decisions
are final, the department carries on business as usual.
So let not the member mix an answer I gave
to a question the other day about when the process starts with the inference
that he has taken that decisions were made at that time, that the department is
on a budget cycle the same as other departments. I am sure that most departments, once the
summer is finished, into August and September, will actively begin discussions
internally on the budget for the next fiscal year. We have signed these agreements with a number
of groups that we are involved with, and we still have some that are pending,
but, yes, the negotiations were in good faith but the decisions that were made
on the budget were taken after those negotiations and discussions at the
officials level were going on.
So I certainly want to clarify in the
member's mind that these discussions by officials from our department and
officials from the Foster Family Association were taking place prior to final
decisions being made within the Department of Family Services and within this
budget.
Mr. Martindale: Shall we call it ten o'clock?
Mr. Deputy Chairperson: Is it the will of the committee to call it
ten o'clock?
Mr. Gilleshammer: Do you want to pass this line first? Do you want to go till 12 tonight?
Mr. Deputy Chairperson: Is it the will of the committee to call it
ten o'clock?
Some Honourable Members:
Yes.
Mr. Deputy Chairperson: The hour being ten o'clock, committee rise.
HIGHWAYS AND
TRANSPORTATION
Madam Chairperson
(Louise Dacquay): Order, please.
Will the Committee of Supply please come to order. Would the minister's staff please enter the
Chamber. We are continuing to deal with the
Estimates for the Department of Highways and Transportation. We are on page 91
in the main budget.
Item 5. Transportation Policy and
Research.
Hon. Albert Driedger
(Minister of Highways and Transportation): Madam Chairperson, first of all, I would
like to take the opportunity to introduce Don Norquay, who is the chairman of
the Motor Transport Board and also the chairman of the Manitoba Taxicab Board.
The member was raising various questions
before, and part of the difficulty that I had was because he was jumping
between the owner‑operator concerns and the load broker concerns. So I would like to sort of maybe set the
record straight before we get to any further discussions on it. Under the owner‑operator concerns that
he raised, he was, in my view, sort of all over the map trying to confuse the
two, and I want to clarify that at this stage.
Madam Chairperson, I had the privilege of
making a presentation to the NTA review committee at the time when they were
here in the city and addressed both the issues of the owner‑operators as
well as the load brokers' concerns. At
that time, under the broker concerns, with a certain amount of preamble, our
recommendation was that the commission should review the issue to consider the
merits of establishing a uniform transport broker regulation, which included
basically mandatory registration of load brokers, required contributions to an
industry claims fund or bonding, payment trust requirements, liability for
proper administration of trust accounts, record keeping requirements,
disclosure of records of a transaction to the parties and powers to cancel
registrations for breaches of requirement.
Those were the recommendations that we made under the load broker
category.
Under the owner‑operators' area, I
just want to maybe read from things that I presented to the NTA committee at
that time, saying that pressures are mounting to introduce measures to ensure
that authorized carriers behave in a financially responsible manner towards
their contracted owner‑operators in the current regulatory
environment. The commission should
examine this problem to determine the need for introducing regulations to
correct this problem, including licensing owner‑operators as independent
contractors with the ability to operate as subcontractors for any number of
carriers, the authority being issued on proof of fitness, including business
ability and safety components, and that the federal government would ensure the
reciprocal recognition by all jurisdictions of a contractor's operating
authority from any jurisdiction to provide uniform application of the policy as
well as flexibility and administrative simplicity, and that the model standards
developed by the CCMTA task force be prescribed at federal regulation for all
extraprovincial trucking undertakings.
I want to come back to the owner‑operator
aspect of it now. The member raised the fact the report said‑‑from
the CCMTA, an agreed‑on recommendation came forward. However, when the ministers met at that time,
there were different political views on the matter, and the ultimate decision
was that every jurisdiction would decide as to whether they wanted to
individually implement some of the recommendations. What has happened, it appeared that at that
time maybe
Our concern, by and large, was that if we
moved ahead and were the leaders in this direction, it would disadvantage some
of our carriers. As a result, by taking
the lead in this thing, we could probably jeopardize the fact that we are the
exporter of transportation services, that we consider ourselves a
transportation hub, and that it could jeopardize some of our carriers and
possibly lead to the fact that they might consider moving to other
provinces. So what I said before we
adjourned is that we are looking at this and reviewing it to see exactly what
is taking place. Once we have a better
feel for what is taking place, we would then take and move forward on some of
the legislative aspects of it. We are
not prepared to do this at this time because we feel we do not want to
disadvantage our carriers in terms of coming forward with the lead legislation
when we feel that it is very important to our carriers that we take and give
the indication that we are supportive and working with them to try and maintain
the transportation hub aspect of it and the export of transportation services to
the rest of the country. So I wanted to
put that on the record.
In terms of the transport broker
legislation that was proposed, we have looked at it very carefully, and we have
some concern that‑‑well, not a concern really; the problem that we
have is that, by and large, through the Motor Transport Board, we have received
virtually no complaints in this area. It
is not a major problem for us here, and it is for that reason that we are sort
of just sitting back and not doing anything with it. So I hope that clarifies to some degree to
the critic the concerns that he raised in terms of why we were not moving
forward on the recommendations of the CCMTA that came forward to the ministers,
because there was no unity among the provinces.
We want to have uniform standards applied whether it is the owner‑operators
or whether it is the transport brokers.
We do not want to take the lead in this thing if we are going to take
and jeopardize some part of the industry for
Mr. Daryl Reid
(Transcona): The minister indicates that he wants to have
unity with respect to these two issues‑‑[interjection] National
unity. I stand corrected for that one
word. In that sense, then, what position
do this minister and his government take or occupy with respect to the other
jurisdictions in
Mr. Driedger: Madam Chairperson, I want to, first of all,
try to differentiate between the two aspects of it, whether it was the owner‑operators'
or the transport brokers' end of it.
The member will specify which area he
wants to address. If he wants to address
it on a general basis, we will cover the waterfront, but I think I would like
to be more specific as to whether he is talking the owner‑operators or
whether he is talking the transport brokers' end of it.
Mr. Reid: Okay, we can do both, but we will do them
separately. We will start off with the owner‑operators. I would like to know the minister's‑‑the
policy of his government and his working nucleus or his group that he says he
has to decide on these issues, because it appears to be done by consensus
internally in the department. What
position have they taken with respect to the owner‑operators' concerns
that have been raised with this government with respect to the way they are
dealt with by the carriers, and other concerns that they might have?
Some of the concerns were dealt with in
the report here. Now, is this minister onside with other jurisdictions in
* (2010)
Mr. Driedger: At the ministers' level, at that meeting,
there was not agreement between the various provinces, so the decision was made
that those who regarded it as a problem would proceed with legislation.
Certain provinces indicated that they
might proceed. To date, we know of only
Quebec that has proceeded with legislation, and it is for that reason that we
basically said, hey, we are going to wait and see, because we do not want to
take and disadvantage our carriers by bringing this forward, and then take that
chance that our carriers might feel disadvantaged and want to take their
headquarters somewhere else.
So we are protective in terms of the
position that we have. I said before that seven out of 11 national carriers are
headquartered in
So by doing this, what we do is create an
unfair disadvantage for our carriers, and that is why we are sort of taking it
and reviewing it. As I said before we
adjourned, we are looking at this, we are studying it. The member was critical, saying, well, why
have you not implemented it? Well, this
is one of the reasons why we have not implemented it.
Mr. Reid: Well, I thank the minister for finally being
forthright to the questions that I had, concerns I had raised before the supper
hour, because it is now clear that the minister is concerned about the
positions that the carriers have brought forward, or had brought to the
minister's attention, and that he is not concerned one small, minute amount,
even about the people who are employed within these industries. I am talking particularly here, the owner‑operators.
So I have to say that I am very
disappointed that the minister would take that type of position and not want to
strike some kind of a balance that would represent the interests of both
parties, both the carriers and the owner‑operators who are employed in
this industry. I hope that the minister,
when we get into further debate on this, will explain to me why he would only
defend the position in the interests of the carriers and would not want to look
at some kind of a balance in this.
Mr. Driedger: The member is totally wrong because I just
indicated the position that we have put forward to the NTA Review Commission
where we said that there should be a national perspective on it, and they have
accepted that recommendation. In their report that they have done, they
accepted our recommendations and said that a national system should be
established, instead of having each province do it individually.
So let the member not say that I have
ignored that. We have put our position
forward very strongly and I am defensive of that, but I am not going to start
being the lead minister or the lead province in terms of implementing
legislation that could be detrimental to our carriers and to our owner‑operators
if we do that. So I feel very comfortable
in the position that we have right now.
Mr. Reid: Maybe the minister can explain, and I will
put this question to him again as I did before the supper break. What part of this recommendation is
detrimental to the carriers' operations?
Mr. Driedger: Madam Chairperson, I wish the member would
have listened to my remarks initially where I said, if we were the lead
province in terms of implementing that when we consider ourselves an exporter
of transportation services, if we are going to disadvantage our carriers by
taking the lead in bringing in tough legislation, and the other provinces do
not do that, what is to keep them from packing up and saying, well, if that is
how you want to treat us we will move to a different province, when Alberta has
already indicated that they will not take and bring forward legislation and
jobs?
Mr. Reid: Always get the jobs in‑‑a very
important commodity for this province.
We wanted to make sure that we retain them in this province. I am glad that the minister mentioned the
word "jobs."
Can the minister give me an indication
then, because he says if we implement these recommendations of this task force
for both the load‑broker and the owner‑operator segments, how many
of the pieces of equipment that these carriers are operating are actually
registered and licensed in the
Mr. Driedger: It is not just the equipment. It is the jobs. It is the headquarters, the head
offices. I mean, it is very flexible, we
are talking national carriers. If we
disadvantage them, what is to keep them from picking up and moving their
headquarters to
My concern and our concern and his concern
should be that we basically try and keep our carriers happy, at the same time,
trying to address the concerns of the owner‑operators so that‑‑
An Honourable Member: We are not, though, we are not.
Mr. Driedger: Yes, we are.
I told the member, our recommendation to the NTA was basically that
there should be a uniform system, a national system, instead of each province
doing it individually. That is not
acceptable. I will tell you something,
if all the other provinces are going to do it, we would be right there with
them. We are prepared to deal with it in
that vein. So let him not try and give
the impression that we are not concerned about our owner‑operators.
Mr. Reid: The reason I raised the issue about the
equipment‑‑and I know there are jobs attached to what we are
talking about here as well. It is the
most important component. [interjection]
The minister says there is a
headquarters. I am sure he is aware, as
his staff probably is, that these firms have operations in other
provinces. One has to wonder sometimes
whether or not they are only operating headquarters here in name only and the
basis for their operation maybe actually headquartered in another jurisdiction
already.
Mr. Driedger: Madam Chairperson, I reject that totally out
of hand, because that is a very false assumption. I mean, they were located here in
What we are trying to do is just be as
fair and reasonable as possible in terms of making them feel comfortable
here. It is for that reason as well why,
under the budgetary process, or the budget that was presented, there is
provision there saying that we will freeze the wages, that there is not going
to be an increase that is going to affect the truckers, just to make them feel
more comfortable here, because I think it is vitally important that we have the
jobs here in this province. I will fight
for jobs in this province anytime.
Just a further piece of information that I
would like to put on the record is, Madam Chairperson, in
Mr. Reid: Can the minister give me some kind of an
indication then, because he says he does not want to be a leader and he wants
to wait for other jurisdictions to come forward with their legislation first
and, in acting upon these recommendations, when would we anticipate and how
many provinces would have to be enacting legislation before we would decide to
move forward to enact the recommendations of these two reports?
Mr. Driedger: Madam Chairperson, what my recommendations
were to the NTA Review Commission at that time were that there should be a
national acceptance or a national standard developed and that was our
recommendation. They are making the same
recommendations. They have accepted our
recommendation in bringing that forward.
The member says, how many will it take? We say that there should be a
national standard established and then everybody should implement the same
one. If we start having provinces each
implementing their own legislation individually in various categories it puts
everybody at a disadvantage. We have
operated on the principle that there should be national standards. We have worked at that through CCMTA and at
the ministers level we have continually worked at trying to establish a
national standard.
Mr. Reid: Has the minister received any indication from
the NTA that they are intent upon acting upon these recommendations to bring
forward a national standard?
Mr. Driedger: Madam Chairperson, could I ask the member to
please repeat. I did not follow the
question totally.
Mr. Reid: Has the minister had any discussion with the
NTA or any of his staff had discussion with the NTA, and have they received any
kind of indication that would show that the NTA is going to move forward on
these recommendations to do as the minister calls for to have a national
standard adopted?
* (2020)
Mr. Driedger: The NTA went out and had their hearings. We made our presentation to them. In their recommendations they have accepted
our recommendations as part of what they feel should happen. My understanding is that it has now been
referred to a standing committee that is now going to take further representations. Based on that, we will again make a
presentation to them reinforcing the position and congratulating them on
accepting the other position that we put forward.
I think we are premature in terms of
saying what have they said. The
committee has referred it to a standing committee that is now going to proceed
further with this, and I understand that this has to happen by the end of
June. We will be putting our provincial
position forward to the standing committee again, reinforcing our position on
that and hopefully that will come to resolve that we are going to have a
national perspective instead of having each province do a knee‑jerk
reaction and feel that they want to take and move in the direction as they will
be lobbied on.
I think that our position from the
Manitoba perspective is a sound one in terms of not charging forward and seeing
whether this review that is taking place, the standing committee, once they get
through with that and make recommendations to the federal minister, that this
might be an issue that we can deal with in September when the next council
ministers meeting takes place.
Mr. Reid: If I understand the minister correctly then,
it is going to be a significant period of time before we see any movement in
any kind of direction on this issue and, in that interim period of time,
however long it may be, the owner‑operators, the 5,000‑plus of them
who are operating in this province trying to eke out a living, are going to
continue to work under the same standards and the same system that they have
had to live under for a number of years now.
I know I have raised these concerns with
the minister before. They have been
brought to my attention, and I hope they have been brought to his attention as
well, because we have some good carriers in this province. There is no doubt in my mind, but there are a
few who are taking advantage of the owner‑operators. I think that there has to be something done
to address those concerns. When I say
that, I am talking about concerns where owner‑operators are gouged for
the fuel and equipment and services that they have to buy through the carriers
under which they operate, under which they have agreements.
There are problems with the
holdbacks. There are problems with
Workers Compensation premiums being deducted.
There are no itemized statements that these owner‑operators
receive from their carriers to itemize the deductions or the holdbacks that are
taking place on their payments. They
have no understanding of what is happening to their salaries, because some of
the unscrupulous carriers are taking advantage of them. I think that is why it is important for us to
move forward with recommendations on these issues that have been
addressed. We had Mr. Norquay represent
us and the concerns we had from this province, and I think‑‑
Mr. Driedger: Capably so.
Mr. Reid: Very capably so. He is a very capable individual, as a lot of
the minister's staff are but, if we do not address these concerns and we are
going to continue to allow these 5,000 people and their families to be taken
advantage of, that is the concern I have.
How do I go back and tell these people now, well, the minister says, we
are not going to worry about you right now, because you are insignificant, we
ought to worry about the carriers?
How am I going to take that back and tell
these people?
Mr. Driedger: Madam Chairperson, that is a totally
irresponsible statement for the member to make, and I will repeat again, when
we put forward our recommendations to the National Transportation Act review
committee, we said in the presentation, where there should be national
standards, we said, the standards include obligations for carriers and owner‑operators
to set out in a written contract their agreement on essential matters such as
the contract term, compensation, legitimate deductions, et cetera, rights to
disclosure of essential documents that funds held back from owner‑operators
shall be held in trust, that owner‑operators may purchase their inputs,
fuel, et cetera, from sources of their choice consistent with the independent
contractor status. These are the
positions we put forward.
He says, well, what am I going to go back
and tell them. Tell them that these are the conditions that we put forward to
the National Transportation Act review committee and that is what we are insisting
should happen on a national scale instead of having each province do it
individually.
I mean, we are going round the horn on
this thing. I think I have put the
position of the province very clear. We
have major concerns for our owner‑operators and are going to work in that
direction.
Mr. Reid: All right.
I will yield some ground to the minister on this then. If he requires a period of time to implement
the major recommendations with respect to these two reports by the task force
and he is waiting for other jurisdictions to implement that or the NTA to take
a role in that process‑‑
Mr. Driedger: The NTA.
Mr. Reid: Yes.
Mr. Driedger: I want that the national standard.
Mr. Reid: Yes, I understand what the minister is saying
when he said he wants a national standard.
I have no problem with that.
Is there any possibility then to assist in
the interim as a minority measure that can be taken where we can come forward
with some kind of a regulation dealing with the way statements are issued to
the owner‑operators who are working for carriers so that these statements
can be itemized? Something that might be
considered by some on that side to be minor in nature is very important to
those who are operating as owner‑operators out in the industry. Can we take some step like that that will not
have serious consequences for the carriers but, at the same time, will be a
good gesture and a good position to take for this minister to show some
confidence in the owner‑operators and the carriers to work together
there?
It is a gesture of good faith. That is what I am asking for here. Is there any way that we can implement some
kind of a regulation that will call for that type of a reporting system?
Mr. Driedger: By doing that, we still run the same risk
that we could take and have our carriers go to operators outside of this
province. So we are sensitive in that
direction. I mean, it all boils down to
the basics of what I said, that if we do this, any movement that we make aside
from other provinces could jeopardize our carriers to take and get out‑of‑province
operators to come and work for them, so we have to be sensitive in terms of how
we do this. The member is saying, well,
do something in the interim. If we do
that, I mean, it is the same thing. Then
we might as well move forward with the legislation and jeopardize it.
I refuse to take and jeopardize the
position of our carriers in terms of giving them an advantage or a reason to
look at different locations and options where they feel there is an advantage
for them.
Mr. Reid: I think the minister is being a little bit
paranoid on this request that I have put to him. I do not see how a simple request that the
minister could put forward through by way of regulation if necessary, or by
legislation, which I do not think it would require‑‑I think
regulation could be the proper route, although his department people would be
the experts on that‑‑why we could not, something as simple as
asking the carriers to itemize statements for the owner‑operators. It is not a financial problem that I can see,
or is there something hidden here that I am not aware of that the minister does
not want to bring out into the open? Is
there something untoward about this whole process that the minister wants to
keep hidden to protect certain people?
Mr. Driedger: The member can skate around this thing
whichever way he wants. I have put the
position of my department and the government forward in terms of why we are
doing this. If we were going to start
implementing certain regulations to address some of these things, then we would
not need legislation, would we?
I mean, the moment we move in that
direction, then we jeopardize the position, and that takes away from the edge
or the position that we have put forward to the NTA Review Commission by
stating that there should be a national standard applied. Then everybody would feel comfortable. The moment we start moving in this direction,
we are right back to, then we might as well bring in the legislation.
An Honourable Member: Not for something that simple.
Mr. Driedger: Yes, it is.
The member has a different view, and that is fine, but I will tell you
something. I will defend the position
that we have put forward in terms of making sure that our transportation industry
feels comfortable, at the same time, paying very serious regard for the owner‑operators,
whom I feel very compassionate with because they are a very important part of
our transportation industry.
We are certainly going to continue working
together with them to see whether we can resolve this but not at the jeopardy
of bringing forward legislation as an isolated province to do that.
Mr. Reid: I think what the minister is doing here is
totally ignoring a very simple request, something that will create, from my
understanding of the issue, no financial hardship or reporting hardship for the
individual carriers or those who own those companies but at the same time will
indicate to the owner‑operators that he is displaying some good faith to
them in meeting one of their requests.
Now, I do not understand what could be
more basic or more simple about a request like that, but I am not sure how this
minister is going to respond to those who are employed in the industry, for him
denying that type of simple request. I
mean, this is something that he could have done as a sign of good faith and now
he is totally rejecting that opportunity to show that sign of good faith.
I can tell the minister that I will take
that information back to those who are employed in the industry. I do not think that they are going to be very
happy with that minister's decision.
* (2030)
Mr. Driedger: Madam Chairperson, I do not get that kind of
direction that member is putting on the record here, because I just indicated
in my last statement that I am prepared to work very closely with the owner‑operators.
But if I bring down regulations that would
take and move one of our carriers out there, these same owner‑operators
are the ones who are going to have to move to a different province if the
carriers decide to headquarter somewhere else.
So get your head around this thing a little bit, because I would like to
think that I am even ahead of the member in terms of the concerns that have
been brought forward about owner‑operators and the carriers. So I reject the suggestion that he could run
back and say and twist it whatever way he wants.
But, ultimately, those owner‑operators
are going to be coming and talking to my chairman of the Motor Transport Board
and to myself, and I will tell him what our position is in terms of trying to
protect their jobs and their future.
Mr. Reid: The minister is right, we could probably
skate around this issue for a long time, and we will probably‑‑[interjection]
Yes, I am quite willing to go all night.
In fact, we will go right to the end of the summer if you want, that is
of no consequence to me.
Mr. Driedger: I am ready.
Mr. Reid: I am glad you are ready because there is
every likelihood that we will be.
Well, I can tell the minister I have had many
a long discussion with owner‑operators employed in the trucking industry
and they have some very serious concerns that they do not think are being
met. I am just trying to give the
minister an opportunity to save some face, which he is not taking the
opportunity to do here. Now, if he does
not want to save face that is his decision and he will have to defend it
himself, because I am certainly not going to defend him.
Madam Chairperson: Order, please.
Mr. Driedger: I want to just caution the member. He can interpret it whichever way he wants
to, but I am dealing with the same people that he is dealing with and I will
tell them they could look at exactly what I have said today. The position that we have put forward on
their behalf, I will stand by that and I will defend that in front of the owner‑operators
any given time. If he wants to slant that or take a different twist in it, I am
prepared to meet with him and the owner‑operators and discuss it and I
will be able to defend my position.
An Honourable Member: I think he got you there. He scored a point on you.
Mr. Reid: Well, it would not be the first time that the
minister scored a point on me. This is a
marathon for those members opposite who do not realize that yet. This is not just a sprint here. It is the long‑term results that will
really determine whether or not the minister's decisions and course of
direction are correct for the people in this province.
I am not convinced at this time that the
decisions that he is making are totally correct and that is one of the reasons
why I call and point out those problems with the minister's decisions. But we
could skate around that issue for a long time here and I am not really sure
that‑‑[interjection] Well, I do not see any written policy.
The minister says he puts it on the
table. If he has a written policy to
that respect indicating why he has not come forward with this, please put it on
the table. I would be more than pleased
to read it and distribute it to let those who are employed in the industry have
an indication of why the minister is not defending their interests, and is only
taking one side of the argument here.
Mr. Driedger: If the member had been listening for the last
half hour, he would find out what the position is that we are taking. I put
much more store in the people who are sitting around me here, to help give
advice in terms of whether we are doing the right thing for the people of
Manitoba than the member sitting across here trying to make some political
points, and I do not accept that.
So I would hope that he would be
forthright with the owner‑operators and say exactly what has transpired
here in the last half‑hour.
Mr. Reid: Okay, I think we have probably said enough
words on the owner‑operator aspect of it because the minister is not
willing to yield at all on that aspect or to show that sign of good faith.
I would like to change the direction of my
questioning towards the load brokers now, because that is the second part of
the report. Does that same load‑broker
situation‑‑and the recommendations that came forward in the final
report‑‑why are we not looking at implementing those
recommendations? Is it going to have, in
the minister's opinion, serious repercussions for the carriers in this
province?
Mr. Driedger: Madam Chairperson, I thought I had sort of
put that position forward as well, in terms of exactly the position that we put
forward to the NTA Review Commission.
They accepted our recommendations in that particular case as well.
What we basically said was, if there are
problems with the load brokers, there is lack of evidence through the Motor
Transport Board and the people that‑‑we have virtually had no
complaints about the load brokers.
An Honourable Member: That is nonsense.
Mr. Driedger: The member says, that is nonsense. He has maybe listened to one individual‑‑[interjection]
We work closely with the trucking industry, not like him where he runs to an
individual and gets some opinion and then comes to try and bang heads out here.
We have the Motor Transport Board which,
by and large, monitors and knows exactly what is going on in the transportation
and trucking industry. We have been a
leader in that for many, many years because of the qualifications of the chairman
of the Motor Transport Board. We feel
there is no justification at this time to move forward with load‑brokers'
legislation.
We recommended that again there be a
national perspective on this thing.
Mr. Reid: I am very disappointed in the minister that
he would discount the opinions of the individuals who have come to see me. There have been many owner‑operators
who have come to see me. He totally
discounts the opinions that they have brought forward.
After all, Madam Chairperson, these are
only people who work at these jobs six and seven days a week, around the clock
if some of them run dual teams. What do
they know about the industry that the minister does not know better? That seems to be the opinion and the position
that he is taking here. I do not agree
with that position and that opinion.
These recommendations and these examples
that I have here, that I hope the minister and his Motor Transport Board would
have had examples as well, indicate what is happening with respect to the owner‑operators
of the province. I am not bringing this
up because I do not have hard‑copy evidence. I have it right here in my hand right
now. If the minister and his department
do not have that information, then they are not the department that I thought
they were. I thought they would have
better resources and better opportunities to have some dialogue with those who
are employed in the industry.
Mr. Driedger: I think the member is all over the map
again. I think he is talking back to
owner‑operators again instead of load brokers. He does not know where he is coming from.
I want to tell you one thing, and I want
to put it on the record. If there are
concerns out there, my office is open and my staff are available anytime to
listen to their concerns. The member
goes out there, tries to promote some kind of a problem, and then he figures he
is going to come up here and raise a big issue with it.
I will tell you something, we have always
been receptive to any concerns that they have.
If he wants to be consistent in terms of dealing with one issue at a
time, under the load brokers we have no evidence to date. In the last year there have been no
complaints about that aspect of it. If
there are going to be concerns, we have proposals here that we are prepared to
deal with, but there has to be some evidence in terms of concerns that come
forward from the industry.
Mr. Reid: I beg to differ with the minister. He thinks the issues of the owner‑operators
and the issues of the load brokers are two separate and distinct issues. I tell him that they are not. They are intertwined. You cannot separate the two of them, because
they impact upon one another. The load
brokers are taking a portion of their profit and then are taking and
transferring those loads to other brokers.
You go broker to broker, and then, by the time the owner‑operator
gets to transport that load, they are hauling it for a fraction of what the
total bill was. It is the load brokers
that are creating a problem there. So it
is having a direct impact upon the owner‑operators who are doing the
actual hauling of the goods. That is why the two are intertwined. I thought the minister would understand that
and not discount the role that each plays in interaction with the other.
Mr. Driedger: Madam Chairperson, the member thinks that he
has the whole industry‑‑he knows what is going on. What happens in a case where an owner‑operator
hauls for a carrier and he hauls down to Ontario, for example, and unless he
has a load back, what he does invariably on his own is contact the load broker,
use the name of the carrier to get a load back.
* (2040)
The member says, well, the owner‑operators
are disadvantaged by the load brokers.
It is their choice if they go with the load broker. If they go on hire for a carrier, invariably
that is where they will get their loads back.
They do not do that. They take
and go on their own to a load broker to try and get their loads back in some
cases. So there is a difference in
there.
We can deal with the load brokers in the
one category or we can deal with the owner‑operators in terms of things
that affect them, but it is by their own choice, very often, that they make the
decision to go with the load broker.
Very often, for whatever reason‑‑I want to tell the member,
and I just told my staff at the supper hour, on April 15, I made my last
payment of $500 which I have paid for four and a half years because my son‑in‑law
happened to be an owner‑operator.
I paid the penalty and know the consequences of hauling for a carrier
and not having loads back and deadheading back, working with load brokers.
So the member is not telling me anything
that I do not know about the industry.
What I am telling him is, I have concerns about the industry because the
transportation trucking industry for
Mr. Reid: Well, I do not see how the minister has been
protective of‑‑I believe what he said is‑‑his son‑in‑law's
job in trucking as an owner‑operator.
I am trying to do things and ask the minister questions concerning owner‑operators,
something that would help his son‑in‑law, and he is taking the
opposite position here. I hope his son‑in‑law
becomes aware of this discussion and that there is no support. I do not mean to draw the minister's family
into the discussion, but he raised the issue, so I thought it was fair to
comment on it as well. I will not spend
any more time commenting on family members.
I do not think that is proper for us as members of the Legislature to
debate that.
I guess we will have to agree to disagree
on the position that the minister has taken with respect to owner‑operators
and load brokers. I hope that he will and
his department will give serious consideration somewhere down the road, whether
it is after the NTA has made its ruling and we get a common position‑‑and
that may not ever happen if what the minister says about Alberta is
correct. If
Can the minister tell me why, in his
opinion, we have not seen the road blockages and the blockades by the trucking
industry as we have seen in other jurisdictions across this country? Can he give me his impression of why that has
not taken place in this province?
Mr. Driedger: Madam Chairperson, without trying to not
necessarily flatter myself or the government, but even the previous
administration was on the defensive in terms of protecting
That position was carried on by myself and
the government to this day. The fact
that we have been concerned and compassionate in terms of trying to deal with
the trucking issues at the national level is one of the reasons why I think the
trucking industry feels that to demonstrate against us here would be
meaningless because, by and large, we have been on the side of the trucking
industry when we fought against deregulation.
We have been the leaders in terms of
trying to be defensive of the trucking industry, and I believe to some degree I
would like to think that that has some bearing as to why the trucking industry
has not been boycotting or demonstrating in
Mr. Reid: Because I had already raised this before the
supper recess, I have heard that there may be some work stoppages with respect
to the trucking industry this coming summer.
Whether that comes to pass or not is another matter. That is just what I have heard from members
of the industry.
What plans do we have in place? Do we have any plans in place to deal with
the issues that are raised so that we could prevent that from happening in the
Mr. Driedger: Madam Chairperson, first of all, let me tell
the member that I do not think that I want to deal in speculation. I would like to think that, if people
demonstrate they are unhappy with an issue, if there was an issue that they
wanted to take up with this particular government, they can come and visit
either the Motor Transport Board or my department. We can have discussions and see because we
have continually tried to be on the side of the trucking industry.
If there are issues that they have
concerns with at the federal level, we would be prepared to take those issues
forward and fight on their behalf. I would
like to think that, before they take action of that nature here in
If they have an issue that is of a federal
nature, we are prepared to talk with them and support them in that
position. If there is an issue here that
is related to
Mr. Reid: I thank the minister for that. I think it is important that if we have
issues that are in the province here, that are under provincial jurisdiction,
we would give those who are employed in the industry the opportunity to come
forward with their concerns and have them addressed, have remedies applied to
address those concerns before the work‑stop action would take place.
I hope that there are plans in place, and
that the minister, if he has received concerns, which I am pretty well sure he
has already, from those who are employed in the industry, that he is going to
act on some of them so that we do not incur the disruption of the flow of
transportation services in this province.
Mr. Driedger: Madam Chairperson, when we made our presentation
to the NTA review committee, we made it on behalf of the trucking
industry. Ironically, the owner‑operators
did not even make a presentation. We
made a presentation on their behalf.
I would like to think that, if there were
further concerns that they have somewhere along the line, they would come back
and talk to us because it was we who were fighting on their behalf in terms of
making these recommendations. They did
not make a presentation to the NTA review committee. We did it, presenting the views that we
thought they wanted to hear.
I would like to think that before they
take any action, if there are any further concerns with the position that the
province has taken on their behalf, they would come and talk to us. I feel confident that they will come and see
us before they do any actions of that nature.
Mr. Reid: I hope that does come to pass and they do
discuss this with the minister prior to any actions.
I will move away from that segment of the
Transportation Policy now and will leave that, even though we do not agree on
the direction. That happens sometimes
when you have people of differing opinions and policies.
There has been a great deal of concern
raised over the course of the last two, two and a half years with respect to
the airline industry. We have seen many
changes. Of course, we see the
difficulties our two national flight carriers are encountering. It is an area
that probably has no easy solution to it, but I am interested to know any of
the decisions that have been made and the positions that have been taken by the
government, as they try to hopefully protect the jobs of those that are
employed in the airline industry.
Can the minister give me an indication of
the number of people that are employed in the
Mr. Driedger: Madam Chairperson, I do not want to take away
from the ensuing debate about the air industry, which is a very complex and
difficult one.
I am wondering if the member, because I
have my chairman of the Motor Transport Board here at the present time, might
consider dealing with the Motor Transport Board issues.
If we want to get into the airport
industry, I can do that, but I have the chairman here right now, and if he
would want to accommodate, maybe deal with Motor Transport Board issues and
even taxis if he wants to. If not, then
I will bring the chairman back tomorrow again, but I thought because I had him
here, if the member wants to pursue that area because I have been very flexible
in terms of how we deal with these things.
If the member feels receptive to that, I would be prepared to do
it. If not, we will continue on with the
air questions.
Mr. Reid: Madam Chairperson, I would normally comply
with that type of request from the minister, but unfortunately I did not bring
my documentation that I need for my questions with me, although I have quite a
pile of literature here. I did not bring
that up with me from my office, so unfortunately I do not think it would be in
my best interests at this time, without those questions that I have available
to me.
* (2050)
Mr. Driedger: Madam Chairperson, I would then ask the
member, if he has no further questions than that, whether I could excuse the
chairman of the Motor Transport Board so he does not have to stay here. If the member feels we are not going to get
anywhere into that area, then I can excuse the chairman and he can leave, and
we can continue with the air debate.
Mr. Reid: I think that would be in order. My questions are going to be concerning the
airline industry and probably towards either the railways or Churchill or both.
Mr. Driedger: Madam Chairperson, then I will excuse my
chairman, and we will continue on into the air industry, the difficulties that
we have in that one. Maybe I should give
a little bit of background to the member before we get into questions and
views. I just want to put some information on the record.
For example, in terms of the employment
factor, Air
The air industry, since open skies, were
being moved on by the federal government.
We were relatively fortunate, because we put forward strong views on
that matter, that they give us a provision in terms of allowing us to have an
observer status. We got briefed before
every meeting that the open skies committee had, and we got a debriefing after
they have had their meetings, which is one of the things that we pushed for was
that we had some input and knew what was going on.
In that respect, the federal government
has been receptive to giving us provision for that. Rolly Savoie, who is very qualified in the
air industry, is the one that has been attending these things on the
department's and government's behalf. We
are very pleased with his ability and knowledge in that industry. He has been doing a very good job for us,
keeping us briefed and giving us direction.
The open skies debates that have taken
place came prior to the major problems that developed between the two national
carriers that we have in
One of the options was amalgamation
between the two, which we feel‑‑the concerns that I had from my
department's perspective was that if we allowed the amalgamation to take place
it would be a dramatic job loss as you merged the two industries. The other concern we had was the removal of
that competitive position by having two carriers out there. It has been a very difficult, tenacious
position that we basically had in
The member probably knows the percentages,
exactly what is involved with American Airlines, you know, whether that is the
right thing to do. Then you have the
Gemini component in there as well. We
have the Gemini employees here, out of‑‑I do not know what the
total is‑‑700‑some employees, we have I think 171 in
There have been endless discussions taking
place between the top people from both airlines with my colleague from I, T and
T, as well as with the Premier (Mr. Filmon).
We have also had extensive meetings with my department and people from
Canadian and Air
To clarify for the member, he probably
knows that the booking component which American Airlines says on the merger
with Canadian I think is less than 25 percent.
I was just trying to get additional
information here to the member that the tribunal‑‑ironic, would you
believe it after all those hearings finally decided they could not make a
decision on this thing? Like, it blows
my mind.
Anyway, but the tribunal had indicated in
the hearings that in the Gemini case that Gemini would probably be better off
under a buy‑out option from Canadian‑American and could still
function because it is only a certain percentage of the component. Gemini, in
their lobbying to us, felt that they would have to declare bankruptcy and be
broken up and we would lose 171 jobs.
Our position, by and large, we are not
sure whether that would necessarily be the case. We feel that they could still continue to
operate because they would be losing that booking component only from the
American end of it, which I think is just a small percentage. It would possibly be a reduction in jobs.
The position that we continually put
forward to both airlines is that, and when we looked at the options, where do
we lose the least amount of jobs for
Might I may be just be as bold to ask the
member: What would he recommend that we
do as government? We have been basically
playing the observer status and wondering which way it is going to have the
least job impact on
So there are some advantages to it. It is a delicate situation and I have
difficulty and so does the government have difficulty in terms of taking a set
position as to which is the best advantage for us. I ask for some advice from the member. He
says I do not listen to his advice. I am
asking now, what would he suggest that we do?
Mr. Reid: Well, the minister has never accepted one
piece of advice I have ever given him yet in two and a half years, so I do not
know why I would expect the minister, if I gave him some suggestions or helpful
advice now, would take my suggestions under consideration and maybe even accept
them for a change.
Now he is into a tight spot. He cannot make a decision on which way to go
and he wants me to bail him out. That is
quite a position for the minister to take.
I mean, I have put forward positions and suggestions on Churchill with
respect to the railway. I put positions
on the table here and have given the minister suggestions with respect to the
trucking industry. I have given him
information and positions with respect to Churchill.
He has not taken one of my recommendations
yet and now he wants me to bail him out of the airline mess that he has got
himself into here. Not a chance, Mr.
Minister, not a chance am I going to bail you out on this one. You have to tell us what your policy is.
Mr. Driedger: Got you, because until now, when it is easy
enough to pick a position, then the member comes up with all kinds of
suggestions. In this particular case, he
is squirming just as much as anybody else, and he cannot give me any definitive
position. He says, oh, I am in trouble
on this thing. I am not in trouble. We are being very careful what we are doing
with this thing, and he does not know which way to attack this, and when I ask
him for advice he is skating like crazy for a change. When he gives some good
advice I will listen. When I do not
listen to him it is because he does not give me good advice.
* (2100)
Mr. Reid: I am with you now, Albert.
Mr. Driedger: All right.
Mr. Reid: I do not know, maybe the minister has not
seen the position that we have taken on this, because it has been a public
release. I am sure if he has the time or
the inclination he can avail himself of that information and that position, and
I will not belabour raising those points in here.
Mr. Driedger: Put it on the record.
Mr. Reid: They are on the record. They are out in public consumption already. I am sure the minister, if his department
does not have them, he can make sure that the staff traces up that information
for him.
It was reported at the end of last year
when Canadian Airlines was looking for some loan guarantees or some support or some
assurances from the various provinces and their employees that they were coming‑‑my
understanding‑‑and meeting with the various provincial
governments. Did Canadian Airlines
representatives come and meet with this government and possibly with this minister
to discuss the opportunities for this government to play possibly some role in
Canadian Airlines' survival?
Mr. Driedger: Madam Chairperson, yes, they did.
Mr. Reid: What was the position taken by the government
at that time with respect to Canadian Airlines' proposal, and what was their
proposal to the government?
Mr. Driedger: Madam Chairperson, that is also on the public
record as to the position that was taken.
Mr. Reid: Maybe the minister can put it on the record,
as he wants all of us to do, put forward his position and the position of
Canadian Airlines when they came and met with the government so that we can
have an understanding of what that position was.
Mr. Driedger: Madam Chairperson, we could play this game
for a while. Basically presentation was
made to us in terms of whether the province would participate. Consideration was given to some degree in
terms of the pros and cons of it. At the
same time the member well knows that Air Canada lobbied very extensively, they
had a big demonstration in front of here telling us not to do that. So we have been sort of very cautious
realizing the impact. That is why I put
forward the employment stats in the
I will repeat again because he was not
paying attention. Air
Mr. Reid: I cannot fault the minister for wanting to
move in that direction to protect every job possible in both of the airlines
and in Gemini as well. I think if there
was a middle ground or a compromise position that could be struck that would
allow that to happen, I think that would be the right direction to go in. What I am trying to determine here is what
the minister considers, what his department considers, because he has experts
at his disposal to advise him and the government, what position has he been
advised by his staff people would be the best direction and the policy to take?
Mr. Driedger: Madam Chairperson, I do not think it is any
secret, because we have been promoting the idea that we needed a competitive
service here, that we did not have a monopoly in this area.
The concern that has been brought forward,
for example, with Air
It is for that reason also where in the
last budget we moved down our tax on aviation fuel from 5 cents to 4.2 cents,
which is not an awful lot, but it is an indication at least, because we would
like to keep that industry here. I do
not know whether members have seen some of the articles that basically came
forward after the announcement was made:
Tax cut pumps up airport fuel sales.
He has probably read that article.
If he has not, I will try and get him a copy, because these are the
things that we have been trying to deal with when somebody accuses us of
favouring the big corporations. We like
to have their presence and the jobs here in
I think it also helps in terms of, if
there was a big differential between our fuel and American fuel over a period
of time, that these amalgamations could tend to possibly allow more of the
activity to take place where, in our relationship, if this continues, where
Canadian and American affiliate, that ultimately they would take and fuel up in
the States and come here. So we have to
balance that out a little bit. These are
all the major problems that we realize.
The member knows as well as I do the
concerns that the industry has, that we have in
Mr. Reid: If I did not know better, Madam Chairperson,
I would almost think there for a minute that the minister was American bashing,
something that his colleagues have accused us on this side of the House of
doing over the course of the last couple of weeks. It seems different to see the shoe on the
other foot now, where the minister is taking that tact.
Can the minister give me an indication,
because it had been reported that the Province of Manitoba was requested to
play a financial role in the survival of Canadian Airlines, and the figure that
was reported, I believe, if my memory serves me correctly, was $25 million as
an investment or a loan guarantee, is that figure accurate? Was that the position that was put forward by
representatives of Canadian Airlines?
Mr. Driedger: Madam Chairperson, various proposals were put
forward to the
This was initially. I mean, lots of things have happened that
have changed on a daily basis, certainly on a weekly basis in terms of all the
various things happening out there. We
said we would be receptive to listening, provided that on a comparative
employment scale and economic benefits from this that everybody pay the same
level.
What happened was that B.C. was the one
that by and large was not prepared to take and really play ball, because they‑‑for
whatever reason, I should not speculate, whether they had Air Canada whispering
in their ear about certain benefits and stuff like that. We would have been irresponsible if we would
have taken and come up with even a quarter when we had a small fraction
here. I do not have the figures here
right now as to what the other provinces by and large the employment factor is
but certainly both, I repeat,
* (2110)
If they did not feel compelled to take and
get involved percentage‑wise, then we felt that they obviously did not
care. So that is how negotiation started.
Then the mergers started coming down.
There has been ongoing dialogue and
changes in the format of what is coming down.
At the present time what is before us‑‑and that could change
again, I suppose, because the tribunal that was listening to it say they cannot
really make a decision on it. Who knows what is going to happen now?
Again, I think that we were probably wise
by not taking a firm position one way or the other way at this time and see how
this thing evolves, because I know that I, T and T, my colleague Mr. Stefanson
and the Premier (Mr. Filmon) have been very much involved in this thing in
terms of seeing which is the most beneficial position that Manitoba could
ultimately take as this thing unfolds.
Mr. Reid: One almost gets the impression from listening
to what the minister just said that we are going to take a wait‑and‑see
attitude to see how this whole thing shakes down and then wherever the chips
fall, so be it.
Is that the direction or the approach that
we are taking? Is that the policy now?
Mr. Driedger: Madam Chairperson, no, but I was trying to
explain to the member that if we would have come down on the side of Air Canada
and Canadian folded, we would have had a monopoly. If we would have come down on the side of Canadian
at this stage of the game, we have the Gemini factor to consider in terms of
the impact on jobs there.
So what do you do? It is a difficult position, and we are only a
small player in this thing, but we are selfish for the interests in terms of
jobs and the economic impact on the province.
That is why we are waiting to see how this thing unfolds a little bit.
From the time that this issue is started,
even from the open skies discussion, and then when we found out that both our
industries were losing megabucks that ultimately if it kept on, both would be
broke. So we basically said, well, hey,
you know, where is the best position for us to be in? We have not come down on the side of
Canadian. We have not come down on the
side of Air
I can tell the member that the lobbying
from both sides has been very, very extensive.
Choose us, choose us, you know.
We say, we will wait and see how this thing unfolds and see which is the
best advantage for
Mr. Reid: The minister mentioned that we had an
individual in the employ of the government who has some experience with the
airline industry. I am aware of the
individual as well. Was the individual
that the minister had representing us‑‑or maybe I should ask the
question first, did we have someone representing us at both the NTA hearings
and the Competition Tribunal hearings?
Mr. Driedger: Madam Chairperson, we had observer status in
both cases and at the last round, we had somebody that was filling in for us
and keeping us informed as to what was happening. My individual, basically Rolly Savoie, that I
had made reference to before, has been flying all over the country between the
open skies hearings and the hearings regarding Canadian and American. You know,
I think he has got heartburn, airburn, from flying up and down. So what we did basically at the last set of
hearings, we had somebody that was observing on our behalf and keeping us informed
as to what was going on.
Mr. Reid: No doubt the individual, Mr. Savoie, is
getting more than his fill of getting back to his roots in the airline
industry, maybe more than what he might like to undertake.
The minister indicated that we had another
individual since Mr. Savoie was unable to attend all of the hearings. Who sat in in our stead at those hearings in
place of Mr. Savoie? Was it someone
under a contract basis, or was it another jurisdiction that maybe were
advising?
(Mr. Jack Reimer, Acting Chairperson, in
the Chair)
Mr. Driedger: Mr. Acting Chairperson, we had a number of
sources that were basically keeping us informed on almost a‑‑well,
virtually a daily basis, if not hourly basis, as to what was happening. We had contacts in
Mr. Reid: I apologize to the minister. I missed the first part of his comments. Some of his colleagues were bantering back
and forth, and I did not hear what he said on the first part of his
comments. Could he repeat that, what he
said for me, please? [interjection]
The Acting Chairperson
(Mr. Reimer): I would remind all members that the minister
is trying to‑‑[interjection] Order.
Mr. Driedger: Mr. Acting Chairperson, what I was telling
the members, we had no contract with anybody.
We had a variety of sources that basically kept us informed from
Mr. Reid: These people that were advising us, were they
competing interest? Did they have
something that they might not want to share as far as the information is
concerned, that we might have been better advised to have our own adviser in
attendance at those meetings?
Did Mr. Savoie, or the people that were
representing us, since the minister has already indicated that we had standing
at both the NTA hearings and Competition Tribunal, did we make use of the
standing that we had, or did we make any kind of a presentation to either of
those two bodies?
Mr. Driedger: Mr. Acting Chairperson, we had information
coming to us from Air
Mr. Reid: The minister did not answer the second part
of the question. Did we make any kind of
presentation to either of those two hearings to put forward
Mr. Driedger: No we did not take a personal position or
make any personal presentation to those.
Mr. Reid: Is there a specific reason that we chose not
to do that, or is it because we were taking a wait‑and‑see attitude
to what shakes out in the industry, whoever is left standing in the end?
Mr. Driedger: Mr. Acting Chairperson, I thought I spent
quite some time clarifying why we were taking the position that we were,
because we were doomed if we do and doomed if we do not in terms of whether we
choose one airline over the other. We
have always believed that there should be a competitive industry out there.
We do not support necessarily a
monopolistic industry, and we think that the competitive position would be
beneficial in terms of making sure that we have good rates. That is sort of the unofficial position that
we have put forward. We will wait to see
how this thing evolves somewhere along the line.
Again, coming back to the point that the
reason why we have not taken a position is because we are also concerned about
the potential, and I say potential, loss of jobs going stateside because of
certain advantages that they might have over providing certain services in
*
(2120)
Mr. Reid: The airlines play a very important role for
us in this province. Hopefully, that
role will increase in importance in the future.
I hope that we will see both flag carriers remain. I have some doubts,
at least looking at what is happening so far, that that is going to occur.
Has the department presented the minister
with any different scenarios that might come to pass on what it would mean to
Manitoba's employment picture in the airline industry if either the Canadian
Airlines merges with Air Canada, or American Airlines does indeed take over,
what would happen to the jobs that we have in this province, the Canadian
Airlines base here, for example? What
would happen to that?
Do we have any studies that we have done
to determine the impact of any of the different pictures that might develop
with respect to the airline industry?
Mr. Driedger: We do not have the specific details in terms
of the impact it would have, but the most negative job impact would have been
if Canadian and Air
If you look at the spread of the employees
here, that would have probably been the worst‑case scenario. Now we have two competing forces here. Just look at the airport. When the member flies, you have the Canadian
component, the Air Canada component.
When you condense that into one, certainly there was a dramatic impact
on jobs if the two of them would merge.
That is one of the major concerns that we
had that you develop an uncompetitive monopoly for one carrier plus a
tremendous downturn in employment because of the merger. We have major concerns about that. Some people seem to feel that we would have a
big dip and then it would start coming back, and ultimately we would get the
employment back without having qualifications.
So I say that I have some reservations as to whether that would be the
route that would really take place when you had a merger between the two.
I personally, and this is not a government
position, but I personally feel that the situation with Air Canada and
Continental, for example, which is already accruing some benefits to Manitoba,
that if we could work it right that should the merger with Canadian and
American go forward, we should look to see whether there are also servicing
advantages to the province here. Our
location is very beneficial, central location across the province, the time
zone element. All these things I think
stand us in good stead, and we have to take and push and keep on trying to
capitalize on that element of it.
I would like to think that if the merger
would go ahead between Canadian and American that we should look at where there
are advantages, as we have done with Air
Mr. Reid: I hope that the reason why the jobs did come
to Air
I am sure that if the Minister of Urban
Affairs (Mr. Ernst) wants to have the opportunity, I could give him a few
moments if he wants to ask some questions of the minister. There may be something that he is aware of,
or maybe he wants to raise some issues.
I would be pleased to give him the opportunity here.
These are questions that are on my mind
here. We have not had the opportunity to
question the minister on this. This is
an issue that has been happening over the course of the last year since the
Estimates took place last, and we have questions with respect to the airline
industry.
I mean, we too have had meetings with the
employees of various airlines and Gemini as well, and we have heard their
concerns‑‑very serious concerns.
I admit there is no easy decision on this one. There is no easy call. With that in mind, in a sense I do not envy the
minister's position, because there is no black‑and‑white decision
that can be made here. If you go one way
or the other you stand to lose.
My concern here is that we could end up
losing a lot more if our two carriers merge, or maybe not merge so much in the open
sense but behind the scenes in their operations with American carriers or
foreign carriers, and we lose the headquarters or the bases that we have
here. Maybe in the long term that would
be more costly if that direction is pursued.
Time will probably tell on that.
The minister has indicated that, I
believe, Continental has brought some of their work to
Mr. Driedger: I cannot verify whether Continental is doing
any offshore repairs. All I can indicate
to the member is that the 727s that Continental has are the ones that are being
repaired here in
We think we have things to offer here in
We are watching this very carefully, and
if there are going to be opportunities where a merger goes ahead with Canadian
Air‑American, if there is some that we can take advantage of, certainly
we were going to prepare to do that. Our
position has all the time been, and I repeat again and I have said this many
times already, that whichever is the most beneficial in terms of jobs and
economic impact for Manitoba is the route we want to take. By jumping into the middle of some of the
controversies that take place, we could jeopardize that, and we do not want to
do that. We are very careful where we
are going.
Again, with my colleague from I, T and T,
and his people who are very, very cognizant of what is going on as well, we are
monitoring it very closely. Where there
are opportunities, we will step in and see whether we can get an advantage for
Mr. Reid:
It was my understanding that airlines
coming in from the U.S.‑‑Northwest, in particular, would come in
from
Mr. Driedger: Mr. Acting Chairperson, I have this article
here, and I will try and get a copy to the member somewhere within the next
day, because I only have this copy here.
But just to give an indication of what that did by reducing the aviation
fuel tax from 5 to 4.2 cents,
There is a whole article here which
basically gives that indication. I think
that is a positive thing when you think, even though we have reduced by‑‑because
they were overpassing wherever they could, and now it seems to be changing because
of that. I mean, everybody is trying to
rationalize and economize. This is a very good indication that, by doing that,
sometimes you win instead of losing that added revenue. I would send a copy of this over to the
member, if he has not got a copy of it anymore. It is from the Winnipeg Free
Press, April 16, "Tax cut pumps up airport fuel sales," just so the
member has that for his information as well.
* (2130)
Mr. Reid: If the article is correct, and we anticipate
that the aircraft will take on greater amounts of fuel here, are there any
opportunities and have we made any contact with the airlines to determine
whether or not Winnipeg and Manitoba would become a regular stop more so than
what they are now, because we have lost some of our routes? It was not that long ago we lost the Winnipeg‑to‑Chicago
route. Are there any opportunities for
us to bring back some of the transatlantic flights here? Has any discussion taken place with the
airlines with respect to either of those two issues?
Mr. Driedger: Mr. Acting Chairperson, first of all, the
airport manager is lobbying all he can in terms of making everybody aware of
it, but let me tell you that the aviation industry is such that the moment
something like this happens you do not have to tell them it has happened. They are very much aware of it. They go where they can make a buck. They are very efficient that way. We do not have to go out and hang out a
flag. They know exactly what the price
is here, and what it is going to cost them, and they now see an advantage of
fueling up here, so it is beneficial.
In terms of re‑establishing some of
the lines that are operating or were cut, by and large, there are ongoing
discussions taking place all the time between the air industry in terms of
whether it is economically feasible to do it, and that is what it all comes
down to. If you run a line or a flight
down to Chicago three times a day or three times a week, whatever the case may
be, if you are flying half full, ultimately it does not make sense to do that.
This is another thing that I think both
Canadian and Air
We have been lobbied by the air industry
as well as by the rail industry in terms of dealing with some of the tax
situations, and they are the first ones, the moment that announcement comes,
they know it. I have to tell the member
that I should not address the rail industry.
I will talk about that later, but certainly aviation people know what
the price is and what their advantages are.
Mr. Reid: I look forward to our debates on the rail
industry. It will be interesting to see how the minister answers the questions
I am going to pose to him with respect to the employment levels.
On the airline industry and the jobs in
this province, has the department done any hard economic studies to determine
what role the airline industry plays in this province, what it means to this
province from an economic standpoint?
The
Mr. Driedger: Mr. Acting Chairperson, there was a study
done a few years ago as to the economic impact of the air industry in
Mr. Reid: I thank the minister for that. The minister indicated it was done in the
last few years. Would that information
be current then, looking at what is happening with the airline industry now, or
would that be dated?
Mr. Driedger: It would be somewhat dated, but I think we
will review what the study basically said at that time, compare the employment
figures and try to give us an updated view of it, which is about all the member
can basically expect, a general impact economically and job‑wise of the
industry in Manitoba, and I will try and get that information to him.
Mr. Reid: There has been some discussion surrounding
the airport and the fact that its 24‑hour operation is turning in to be
somewhat unique in airports across
Mr. Driedger: This discussion has been taking place for a
number of years, actually. I am always
pleased when I end up flying and landing in
There is always that ongoing debate as to
the noise levels and stuff of that nature, but I think especially the cargo
component, to be able to operate on a 24‑hour‑a‑day basis is
very, very important economically, and that is why the debate has been taking
place in terms of airport protection. I
am very pleased to say that the Minister of Urban Affairs (Mr. Ernst) and the
Minister of Rural Development (Mr. Derkach) is responsible for the planning
districts and the Minister of Urban Affairs responsible for the planning with
the city, are going to be bringing forward joint legislation for protection of
three airports in
Initially, we looked at doing general
airport protection legislation. We feel
it would not be necessary for most cases, but that we are addressing basically
the
Further to that, the member is probably
aware that there are efforts being made right now to establish an airport
authority in
We are into the second stage now in terms
of negotiating to see whether we can, first of all, negotiate a negative lease,
because it is not feasibly viable, economically viable, at this stage of the
game to proceed with a local airport authority under the present arrangements,
so that there should be a negative lease type of arrangement to take and offset
some of the shortcomings until the authority, by and large the airport
authority, can develop economic activities.
I initially had some mixed thoughts on the
matter, but I am very supportive of it because I feel that under the federal
jurisdictions, which the airports are run under at the present time‑‑for
example, the Winnipeg International Airport‑‑that the federal
government is not necessarily that aggressive in terms of looking for new
economic spins related to the airport.
We think that under a local airport authority, that kind of activity
would be enhanced and take place in terms of looking for other revenue sources
in terms of whether it is cargo hauling, et cetera. There are other areas that
could develop, and so the group that is promoting the airport authority concept
out here is very excited and feels that it can do a much better job than
allowing the federal government to continue the way it is.
So these negotiations have taken
place. Ultimately, decisions will have to
be made in terms of whether we proceed on that basis or not, but I think there
is merit in terms of the direction that they are moving and hopefully something
will come out of it.
Mr. Reid: Do we feel that there is a sufficient amount
of passenger traffic through the airport to justify or even support the
movement or the change to an airport authority?
From my understanding of the concept, there is going to be a change in
the business arrangements where we have a greater participation by merchants in
the airport operation itself as well.
Do we see that there will be enough
interest or enough support by the business community to support that type of
authority?
Mr. Driedger: Because at the present time there has been
quite a change in the passenger‑‑you know, there has been a dip in
the thing, at the present time it would not necessarily warrant it based on
passenger activities. That is why, by
and large, the local airport authority is trying to negotiate what they call a
negative lease so that there is, the airport authority, when they take over,
instead of paying a lease that the federal government would still be paying us
the difference between a successful financial economic operation and the losses
that would be incurred.
This is part of the process that is taking
place right now so that there would not be losses accruing to the local airport
authority as they develop the financial concepts in terms of getting the
business community involved and expanding the financial activities around
there.
* (2140)
Mr. Reid: If I understand the minister correctly, the
federal government will still continue to play a role, but a diminished role,
over what they would be playing now in support of the airport operations. That would assist them obviously but, at the
same time, change the concept of our operations here as well.
Mr. Driedger: That is correct. The other thing is the safety aspect of it is
still under federal authority, so that role would still be played by the
federal government as well. It is the economic
aspect of it that is basically under the local airport authority. The safety aspect of it is still under
federal transportation authority, the safety authority.
The advantage that we have is that we have
a number of the airports that already are under their own authority so we can
look at what they are doing and gauge comparatively. I think there is some advantage to not being
the guinea pig because ours is not one of the bigger airports.
We probably are the first ones looking at
negotiating a negative lease arrangement to cover some of the potential losses
until the thing is viable. I think there
is good strategy involved, and I think there are potentially good benefits for
the province in doing this.
Mr. Reid: There is also concern. We had thought there was going to be a
courier come and establish here and, of course, bring some job opportunities
for us to the province.
Is there ongoing discussion or discussion
still taking place to try and bring more of the courier‑type business
here? As the minister indicated, we have
24‑hour operation at the airport.
We are centralized on the continent.
What development or progress is taking place with respect to bringing
new freight or courier traffic to the province?
Mr. Driedger: There are ongoing discussions all the time in
terms of expanding their carrier service.
In fact, at the beginning of the week, I just looked at‑‑I
have not got it here‑‑an article, a fax that was brought forward by
Canadian converting some of their‑‑they have an oversupply of
certain planes. Instead of just having
them sit idle, they have converted them into cargo carriers, carrying big cargo
type of things. So that announcement
came forward just this week, and
Again, the fact that we are a central
location on central standard time, centrally located in terms of the activity
that goes carrier‑wise north‑south, east‑west, I think these
are things that stand us in good stead and that we have to just continue to try
and capitalize on them.
Mr. Reid: Have we had‑‑maybe I should ask
this question first just to continue along that line of thought. The traffic that CP Air is now using their
aircraft or converted their aircraft for, is that domestic traffic we are
talking about here, or are we talking North American traffic that may be going
offshore as well?
Mr. Driedger: Mr. Acting Chairperson, it is mostly domestic
traffic.
Mr. Reid: I have had some discussions with people that
are employed in the airline industry that obviously know it better than I
do. They have indicated that the
couriers that would fly international traffic like Winnipeg's location as a
refuel point before they go overseas to Europe in the sense that if the
aircraft comes loaded from American departure points, they would have to stop for
refuel before going over the Polar route to Europe. Has that type of business opportunity
developed, or is it in progress, where we can encourage American freight
shippers or couriers to utilize
Mr. Driedger: Those discussions have taken place not only
with the Americans, but when we had a Russian delegation here, they were
looking at the same thing in terms of using this as a route. That is why the reduction in the aviation
fuel tax gets to be more obvious all the time.
Obviously they would not stop here if there was going to be a big
financial disadvantage, but when you start making it more attractive with our aviation
fuel tax now being lower than Alberta's, for example, it starts drawing the
attention.
This is part of the discussion that is
taking place in terms of getting more maximum benefits out of the situation in
terms of aviation fuel, being a‑‑what do we call it?‑‑fuel
depot, whether it is going south‑north‑‑fueling stop even‑‑east‑west. We think that there are things that can be
addressed in that way that are going to be beneficial to
Mr. Reid: I know the minister has indicated that we
expect to see a significant increase in the amount of on‑load fuel here,
but do we anticipate that there will be increased opportunities as well to go
along with that, or are the aircraft just going to stop here, take on the fuel
and maybe a few passengers?
Mr. Driedger: Mr. Acting Chairperson, I would hope that
those are the things that we are trying to address, both with I, T and T and my
department, to see whether there are further advantages that could be gained by
the promotion of advantages to come here, that they do not just take fuel. I mean, the idea is to try and capitalize on
every dollar that we can from outside of the province.
Mr. Reid: Is the differential great enough over the
long term? Does the minister feel that the differential between the fuel taxes
of the various provinces is great enough to encourage the airlines to come
here?
Although I do not know for sure, because I
do not have that experience or that expertise available to me, do airlines make
long‑term decisions with respect to the location of their bases of
operations and their points of operation?
Have the airlines indicated to the minister that they are interested in
establishing greater utilization of the facilities in
Mr. Driedger: That is why I undertook to send a copy of this
article to the member, because it says in there: "Mr. Bishop said he expects a good chunk
of extra fuel will be purchased by Air
"But he expects some other domestic
and international carriers also will opt to take up more fuel here now that the
prices are more competitive."
That whole article, I think, sort of
relates to that, and I will send a copy to the member so that he can have a
feel for exactly how dramatic maybe this impact could be.
Mr. Reid: There are more questions that I could ask on
the airlines right now, but I think we have spent a fair amount of time on that
already, even though it is important to us.
I thank the minister for his comments on the role that the airlines and
the airport are going to play. I hope‑‑and
maybe I should ask one last question.
* (2150)
The minister has indicated that his
colleagues are going to be bringing forward legislation with respect to the
airport authority‑‑or not the authority, but the airport's 24‑hour
operations. Will we be expecting that
legislation this session, or will that come forward in the subsequent or next
session?
Mr. Driedger: Yes, Mr. Acting Chairperson, there will be
legislation coming forward this session for airport protection for the International
Airport, St. Andrews airport and the Selkirk airport. This is basically something that the
opposition has been screaming about for the last few years. [interjection]
Mr. Reid: Some of us may joke about this, but it is
very serious and very important to us in the province. We had tried in past sessions where we
introduced private members' legislation to protect the 24‑hour airport
operation. We had looked at the
Mr. Driedger: Mr. Acting Chairperson, the legislation has
not in my jurisdiction to bring forward.
The Minister of Urban Affairs (Mr. Ernst) and the Minister of Rural
Development (Mr. Derkach), and I tried to explain that before, are the ones
that are bringing it forward, whether they have used the Alberta model or not.
My concern was basically to bring forward
airport protection legislation. That is
coming forward, and I am very pleased though I have no role to play in terms of
the legislation itself. The two members
are going to bring it forward. How they
have modelled it, I do not know, but they have consulted with the city on this
matter which is very important. They
have also consulted with the municipalities involved. [interjection] They have
not consulted?
It has taken a long time to bring it to
this stage because initially we were waiting to see whether plan Winnipeg 2000
would be addressing it. Obviously it was
not what we basically wanted, and the Minister of Urban Affairs (Mr. Ernst)
time and time again said we would allow the city to take and make provisions for
protection of the airport in their Plan 2000, and failing that we would bring
forward legislation.
Obviously we were not quite satisfied with
what the city was doing in that regard.
As a result, the two ministers have taken the initiative and developed
legislation which will be introduced this session.
Mr. Reid: Well, I hope that the minister's colleagues
have consulted with him as well with the municipalities that are impacted,
since it will have an impact upon their role and their operations.
I look forward to that legislation when it
comes forward. I hope it does protect
the airport and has the intended purpose of providing that protection for the
operations.
I would like to switch now to talking a
bit about the policy with respect to the operations to the
Is the minister aware of these cars being
constructed and now being in service?
Does he have any information that he can provide or share with us?
Mr. Driedger: Mr. Acting Chairperson, let me first of all‑‑I
do not know to what extent we can get into the whole Churchill issue today, but
when we talk of the articulated hopper car that is being built in Regina, from
the time that this came forward we raised a concern with the federal minister,
had various discussions with him indicating that, first of all, the concept of
the articulated hopper car was developed in Manitoba.
This is where a prototype was built, here
in
However, one of the things among other
things that we were not successful in negotiating with the federal government,
the prototype hopper car that is being constructed in
Mr. Reid: It is my understanding that the original
articulated hopper car that was constructed here in the Transcona CN shops is
still in service. It is still providing
the service to the producers of western
(Madam Chairperson in the Chair)
It is also my understanding‑‑and
the minister can correct me if I am wrong; I will not be able to confirm this
until at least tomorrow‑‑that CN has constructed another hopper car
to serve the potash industry. I guess
the concern I have here is, are those cars going to be constructed? It is my understanding there is supposed to
be a fleet of cars constructed. Was that
second car constructed here? Does that
mean that we are going to have the opportunity to construct a portion of the
fleet or all of the fleet of cars should they win, because I understand it is a
competition between CN and CP who produces the best car.
Has the minister had any discussions with
either CN or CP with respect to construction of those cars?
Mr. Driedger: I do not have information on that issue at
the present time. I hope to have some by
tomorrow when we further the discussions on that, but if there is something
that the member can enlighten us on that we do not know‑‑seemingly
he has contacts there, sometimes more so than we have, but I would not
necessarily admit that all the time‑‑if he has some information
that he feels is pertinent for us to pursue further, we certainly would like to
do that.
Mr. Reid: What I will do is I have a release that came
out of CN public affairs just the beginning of this month, and I will provide a
copy of it for the minister so that he has an idea of what is taking place
here. Maybe he can do some research into
that, because there is potential here for opportunity, and it is my
understanding that it is a contest between CN and CP who makes the best
car. No matter who wins, maybe there is
some possibility here that we can construct some of those cars in this
province, create job opportunities for us in this province in the rail
industry. So I will provide a copy of
that for the minister, and maybe he can do some research on that.
I was also informed that quite possibly
the purpose of this contest, if we can call it that, the so‑called winner
of that contest would then be given the opportunity to move the potash traffic
in those cars that would not be owned, I understand, by either of the railways,
but would be owned by the corporation in Saskatchewan. Maybe the minister can do some research into
that as well, to see if that is actually the case. It would be interesting if we could have the
opportunity since we had built the original hopper car.
I would also be interested to know whether
these new cars that are constructed now, whether the new car that is
constructed by CN in particular is of similar or same design as the original
articulated hopper car that was constructed, because then I think the minister
would have a good case to go back at both CN Rail and the federal government to
say that the taxpayers of Manitoba had paid for some of the associated costs
with that first car and that we would have a stronger claim towards some of
that construction work.
Mr. Driedger: Madam Chairperson, I welcome some of the
comments that the member has made in terms of getting us some information, and
certainly we are receptive to any information we can get along these
lines. On the articulated hopper car,
the prototype that was built, to my understanding, it is built along the same
lines. Whether we have a copyright on
this thing or not is questionable, because they make some modifications and
they say, well, it is a new design, but we are looking further into that to see
whether there is some case we can make.
The only problem is that they apparently have made the decision that
this particular prototype or this particular hopper car that they are constructing
for the carrying of potash has already left, and how do you then change it at
this stage?
You see, it is almost two years ago since
they started manufacturing it. We have
correspondence where we raised our concerns and‑‑[interjection]
Dennis tells me here that CN had the exclusive design rights on that thing and
so they decided where they are going with that.
If it had been just the federal government, I think our case would have
been stronger. With CN, as we do with
many other things, we continually debate with them about employment issues,
Churchill issues, other issues. So that
is an ongoing issue with CN in terms of what they are doing or not doing to
Madam Chairperson: Order, please. The hour being 10 p.m., I understand the
honourable member for Transcona (Mr. Reid) wants to ask one quick
question. Is that the will of the
committee, to continue?
Mr. Reid: I have some information for the minister,
Madam Chairperson, not a question.
Just for the minister's information as well,
it is my understanding that the new car here that we are talking about is not
part of the GE rail car services contract.
It is, I think, from my understanding, a separate and distinct
construction agreement. That is all I
have.
Madam Chairperson: The hour being 10 p.m., committee rise. Call in the Speaker.
IN SESSION
Mr. Speaker: The hour being 10 p.m., this House now
adjourns and stands adjourned until 1:30 p.m. tomorrow (Tuesday).