Mr. Chairperson (Ben Sveinson): Order, please. Will the Committee of Supply please come to order. This afternoon this section of the Committee of Supply meeting in Room 255 will resume consideration of the Estimates of the Department of Consumer and Corporate Affairs. When the committee last sat, it had been considering item 5.1.(b)(1) on page 37 of the Estimates book. Shall the item pass?

Mr. Jim Maloway (Elmwood): Mr. Chairman, we had previously decided in the committee that we would not deal line by line.

Mr. Chairperson: You are right.

Mr. Maloway: We would simply move around in the report.

Mr. Chairperson: Yes, that was agreed and you can resume your questions wherever you would like.

Hon. Shirley Render (Minister of Consumer and Corporate Affairs): Actually, Mr. Chairman, if I could just advise the member for Elmwood of the staff who are here because he may want to direct some of his questions. We have Marjorie Simpson, who can handle all questions regarding the Consumers' Bureau; and Lucy Couture, Acting Director, Insurance Branch; and Fred Bryans, who was introduced yesterday. Perhaps you may wish to direct some of your questions in that direction. I am sorry, I did not catch the honourable member's question that he just posed.

Mr. Maloway: Mr. Chairman, I would be happy to repeat it. Yesterday, at the end of our session we had just started to deal with the issue of Y2K as it relates to this particular department. There are quarterly meetings held in which the deputy minister is briefed as to the progress of Y2K readiness of the computer systems. So I would like a report on what happened with the deputy at the last meeting held, well, it would be held at the end of May as to what was discussed and what sort of problems were dealt with at that meeting.

Mrs. Render: Again, I am wondering whether we can defer just for a short time the questions on Y2K discussions simply because we have other staff here. Would that be possible? Maybe can we shorten those questions, so we can deal with the Consumers' Bureau or the Insurance Branch.

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Mr. Maloway: I would expect that we will have plenty of time to deal with Consumers' Bureau and Insurance Branch now and at future meetings. I certainly did not come totally prepared to deal with exclusively those two areas in totality today, although I can, there is no question about that, but we will be wanting to bring them back again later on. I only brought up the subject of the Y2K because that is just where we left off last night. I was going to suggest that we could go into the Planning branch because I know we can take care of a lot of areas that I was interested in under the Planning and Research branch. Since Lucy is here, we can deal with the Insurance Branch pieces of that today, too.

Mrs. Render: Our director of the Planning and Research was unable to be here in the city today. Unfortunately he was scheduled for out of town.

Mr. Maloway: That is certainly not a problem with us. We have lots of time. So, if we could deal with the Y2K issue and get that out of the way, then we could go on to others.

Mrs. Render: My deputy advises me she was unable to be at the last meeting, but from past conversations our department is in very good shape. As I had mentioned to you yesterday, our department is Y2K ready.

Mr. Maloway: I would like to know about the testing program that the department has done regarding Y2K as to what the schedule was for it or is for it, whether there is still testing going on or whether it has been all completed.

Mrs. Render: I am advised that all the programs have been tested. Is that correct? And there is a full-scale dress rehearsal, so to speak, in September. Also, just to answer a question that the member asked me earlier about the annual report, I understand it is to be ready sometime in September.

Mr. Maloway: Could the minister tell us whether the whole Y2K computer project as it relates to her department was under budget or over budget?

Mrs. Render: Some of the testing was done by the Better Systems initiative, so, in other words, our part was time and material. One of the areas came in under budget. One, I believe you said Vital Statistics, was right on budget, and the balance has been done internally.

Mr. Maloway: I assume the minister is dealing with the SOAs, as well, then, including those systems.

Mrs. Render: That is correct, Mr. Chair.

Mr. Maloway: I wonder if the minister could provide us with a list of the Y2K projects, who did them, and the testing methods and so on. Obviously, you will not be able to get that today, but if you could endeavour to get it. I am interested in–

Mrs. Render: Yes, we can provide that.

Mr. Maloway: What I am interested in here is not only the computer programs that were purchased and the computer hardware that was purchased, the cost and where they were purchased from, but also the Y2K testing contracts, if any, that were let. The minister will know that in some of the other departments companies were hired to do Y2K testing and Y2K changes to the computer systems. In some cases they were running parallel systems, right. In case of failure of one, they could go back to the other.

Mrs. Render: We will be pleased to gather this information and provide it to the honourable member.

Mr. Maloway: I would like to know what activities have occurred in the last year regarding Y2K issues with this department as it relates to its dealings with consumer groups, financial institutions, school systems. What, if anything, has the minister or minister's staff done in that regard?

Mrs. Render: Consumer and Corporate Affairs has worked with a variety of clients, client groups, and national associations to advise Manitobans about the Y2K issues. I will just briefly go over some of the groups that they have worked with.

Trust, Cooperatives and Credit Union. The branch sent out a brochure entitled Impact 2000: What the Turn of the Century Will Mean to Your Computer Programs and Your Bottom Line to all co-operatives. Credit unions and the caisses populaires have fully developed plans to Y2K compliance, and the branch is monitoring progress to ensure that the plans will be completed on schedule.

The Insurance Branch: In September 1997, all provincially incorporated insurance companies were advised to assess their year 2000 computer exposures, and, in order to ensure compliance, all insurers are expected to follow the federal Office of the Superintendent of Financial Institutions Best Practices.

Mr. Maloway: Could the minister detail any actions of the Securities Commission has taken with regards to Y2K?

Mrs. Render: The Manitoba Securities Commission has taken a very proactive role in conjunction with the other Canadian securities regulators through the Canadian Securities administrators in addressing year 2000 issues as they relate to the securities industry.

On December 1, 1997, the Manitoba Securities Commission distributed to the industry CSA Notice 31-301: The Year 2000 Challenge: Setting Out Expectations for the Industry concerning readiness to deal with the issue.

Then about a month later, on January 30, 1998, the Manitoba Securities Commission distributed a second CSA notice, 41-301N and 51-302: The Year 2000 Challenge Disclosures: Issues Dealing with Expectations concerning disclosure by companies distributing their securities to the public. Very specific to this particular issue.

Then again, a few months later on April 1, 1998, the Securities Commission distributed a notice to its registrants, advising them to contact the Manitoba Securities Commission, really concerning any anticipated year 2000 compliance problems.

Then a number of months later, at the end of October 1998, the Securities Commission distributed a notice and CSA national instrument 33-106: Year 2000 Preparation Reporting, which imposed reporting requirements on our registrants to report on year 2000 readiness on an ongoing basis.

So I guess really it would be correct to say Consumer and Corporate Affairs continues to advise clients about Y2K in as many ways as possible.

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Mr. Maloway: I would like to know whether the minister has any detailed plans to deal with this issue. When the year 2000 arrives, what sort of problems does she anticipate might occur? How does she plan to deal with them at the time?

Mrs. Render: Well, I am not too sure just what the member's question refers to. I can really only talk about Consumer and Corporate Affairs. I cannot discuss other departments and their programs. There is obviously no way to ensure that everyone gets the Y2K message and no way to ensure that all who get the message take notice of it. Maybe the member could be a little more specific.

Mr. Maloway: Well, certainly the minister will know that during the flood two years ago there were contingency plans that the government had in place. They pulled up the old project–I forget the name of it right now–from the 1950s. They were making plans, they were updating. I believe it was Project Blackboy from the 1950 flood. They worked out a contingency plan to deal with the flood, depending on how bad it got, depending on how high the water went, and they would make certain moves.

What I do know is that the deputy is meeting quarterly with Y2K. I have no idea whether it is just simply for them to tell her what is going on or whether it is a two-way discourse here, but surely there must be some sort of an overall game plan that you are following here.

Mr. Maloway: I appreciate the response. I mean, what the minister is dealing with here is exclusively the department itself. I appreciate the fact that this department may be fully operational January 1, but it would be small comfort if the rest of the province is shut down, though, but at least you will be operating correctly. What I am asking about is does the government itself have an overall plan as to what it is going to do on January 1?

I know it is certainly taking care of itself. I am aware of that. The government up to two or three years ago has recognized this is a problem. I recognized yesterday that this province is further ahead in this area than some other jurisdictions. Certainly it is ahead of a lot of other countries and it is ahead of other provinces in recognizing, understanding the problem and working to do something about it. That was quite clear a year ago, but what was not clear is who was worrying about the rest of the province and the rest of the economy, and it did not seem to me like anybody was.

It was just a few people recognized the problem, were getting the government compliant, but that is wonderful, so the government's compliant, but what about the rest of the province? We talked yesterday about the municipalities and the mining industry and all sorts of other industries. So does the government itself have an overall plan?

I know you do and you are going to be operational. I understand that, but what about the rest of the province and where is the plan for the rest of the province?

Mrs. Render: There is a Y2K office, and it is the Minister of Finance (Mr. Gilleshammer) who oversees that.

Mr. Maloway: I know where it is, I know who is there. I have all those answers. What I am trying to get at is where is the overall plan here, and is there an overall plan? Is there any appreciation of how minor this could be or how major this could be?

Mrs. Render: I guess I would have to say to the honourable member that, yes, government is very mindful of what could potentially be an interesting moment in our history. That is why the Y2K office is in the Ministry of Finance, because Finance touches on every single department. The Minister of Finance will be overseeing and ensuring that everything is in compliance.

Other than that, I really cannot speak for the Minister of Finance and tell the honourable member the overall plan. I can only speak as it concerns our particular department.

Mr. Maloway: So I guess then what the minister is saying is go to Finance for the questions about the overall government, and that is fine, we will do that. So we have established that the department is going to be Y2K compliant and things will work here. We are not sure about the overall government and as far as the consumers are concerned, which is the other big area, I would like to know what the minister is planning to do about consumers, potential consumer problems?

Now, the Consumers' Bureau is represented here, but I guess I would like to know whether there have been any complaints thus far about noncompliant consumer products? Let me give you a few examples. By way of background, as late as last July, I believe it was possible to buy fax machines in one of Canada's leading retail consumer product stores here in Winnipeg that were not Y2K compliant. It is only if you understood the subject and asked the question of the salesperson and got the salesperson to actually spend some time and look into it that you really got answers.

Now, let me tell you what I found out. In the case of three or four fax machines at this particular leading chain store, after putting an effort into it and chasing this issue around with him because he obviously did not want to talk to me about it, obviously did not understand the problem, once I pinned him down and got his information, I found that I think two of the four were compliant and the other two were not.

Now, I ask you: what will happen when these things do not work? What will happen when these machines do not work properly in the year 2000? Will the people that bought them file a complaint with the Consumers' Bureau, and if so, then what is going to happen at that point? Are we dealing with a warranty question here? You know, it is buyer beware, right? If you were lucky enough to have bought one of the two that works, then you should be okay. If you were unlucky enough and bought the other one, then what is going to happen?

I set another example. Until last year, one of the major computer manufacturer-resellers, Gateway would–and Dell as well. I mean, these companies are huge and they are very reputable companies. But I think even if you phoned them today, you will have to chase them to get them to certify Y2K compliance on their computers, and it is only six months before the deadline. They just do not want to do it.

So what is being done in this area? Have you had any complaints so far regarding products that may or may not work? If so, when you do, what are you going to do about it?

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Mrs. Render: The Consumers' Bureau did hold an information session just last month, using consumer education volunteers and officers. They went out to give some, I guess, you could say basic information to refer consumers to other sources–provincial, federal publications and websites and so on when questions do arise. The Impact 2000 and the Millennium Home Bug Check are on display at the Consumers' Bureau and are also available to consumers and other clients upon request.

In answer to your question, have we received any complaints, no. Maybe you are going to be the first one bringing one to us.

Mr. Maloway: I am not surprised that you have not received complaints yet, because nobody has had one that will not work, right? It is just how many consumers before they buy a product today are asking this question, and the truth is they are probably not. But they will be January 1. So are you planning to bring the staff in overtime or hire some new ones to handle the flood of complaints that you may get when these products do not work?

Mrs. Render: I can see a smile on the honourable member's face, so I am not too sure just how to take that question. I would say that consumers are fairly well informed. There has been a lot of media. I would say that a lot of the stores that are selling computers, the salespeople are very quick to talk about their product and the fact that their product is Y2K ready.

In answer to the member's question as to whether we are going to be bringing more staff on, making our staff work overtime, I guess I do not have an answer for that. I think perhaps the minister is being a little pessimistic. Staff at the Consumers' Bureau have always seemed to be able to handle anything that comes at them.

Mr. Maloway: Well, you know, I admit there are no right answers here. I mean, you have to start considering all the possibilities, right? I would like to know who, if anybody, is going to protect the consumers and perhaps issue some warnings, or at least talk to the stores and so on about what they are stocking. I am not sure what the right answer is.

You have this Research and Planning monitoring department that has been monitoring gas prices ever since Ed Connery's days, and I have not seen a lot of results coming out of there on gas prices. Now, can this same research department not do some research on just what we have been talking about, go in and check these consumer products, start asking these questions and compile some results, maybe come up with some kind of analysis as to how many consumer products are out there on the shelves right now that are compliant and how many of them are not and come up with a recommended list. [interjection] The Chairman says how many need to be compliant? These are questions that you should be asking now, Mr. Chairman, not after you have the products.

Mrs. Render: I agree with a lot of what the honourable member has said. Again, I repeat, I think there has been a lot of media attention on this. I think we probably will be putting out a news release once again advising consumers to ask the question. Possibly we will be suggesting some of the questions they should be asking. I believe that the Y2K office is also going to be doing more as we approach the end of the year, again alerting consumers of questions they should be asking.

Mr. Maloway: The minister knows that one of the biggest problem areas for the department is the whole area of warranties. That is where a huge amount of problems are, have been historically. Businesses are ready to deal with or sell the products and actually even make verbal warranties that are never followed. That is a big problem. You can save $100 on a product and then find out that you have warranty problems at the end of the day. I would like to know what is being done to, in a way, find out just how big the problem is. Are we looking at a huge amount of noncompliant products being sold in this province? Then we are going to have a huge amount of complaints about them.

I am looking at computers here. Do we have a lot of computers today? Does anyone here know whether all the computers being sold today are Y2K compliant? I mean, they should be. You would think they should be. But do we know that for sure? The same thing is true of other consumer electronic machines.

I am suggesting, the research department is there. Why do we not send that research department out to do this little study and have them come back with some results? The minister could give me the results, and we could take it from there.

Mrs. Render: There are provisions in The Consumer Protection Act to protect the consumer. If the consumer was promised Y2K readiness in the contract–I am looking for the word that I am looking for. I guess the bill of sale. You are asking about computers. I know that when I purchase a computer it has certain things on it. Again, when I purchase a computer as, hopefully, ideally, most consumers do when they purchase a computer, they are ensuring that what they are requesting for in the computer is all laid out.

Certainly this is a question that I myself have asked: Is it Y2K ready? So I keep my bill. As I say, The Consumer Protection Act is here to protect the consumer. But, obviously, the consumer has to do his or her homework ahead of time to ensure that he or she has asked the questions and that is in the bill of sale.

Mr. Maloway: I have noticed a distinct reluctance on the part of the computer people to certify that it is compliant. If they are reluctant to do it, it means simply that they are not really sure whether it is going to work either. I mean, it is the bottom line. They do not want to warranty something that they are not 100 percent sure of. I am sure that is what it is. But, at the end of the day, the consumer is the one we have to worry about here. I would like to know: Will the minister undertake a study of this area and report back?

Mrs. Render: I guess the question would have to be asked: is it just computers you study? I would say that there is a whole spectrum, and our Consumer Affairs department just would not be able to handle that spectrum. I mean, you have got computers, you have got cars, you have got anything with an electronic device in it, and I do not think you can just pick one particular area. That would tie up I do not know how many years. I have been advised that we think that the federal government is doing something in this area, and obviously we will be asking them questions.

Mr. Maloway: Well, once again, I do not think it is really that complicated. Whoever you have checking gas prices, just have them stop at a few stores and do some random checking. I mean, you give the Consumers' Association money, grants. Ask them to do it. They do price comparisons right now, grocery price comparisons, so ask them to do it, but get somebody to do it. Then, when you get some results, have a press conference and start promoting your findings. That would be my suggestion. I mean, I will come along with you and attend your press conference.

Mrs. Render: I will certainly take the member's suggestion, and perhaps the member and I can go out and do something.

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Mr. Maloway: That is fine. I would appreciate it if the minister would look into that a little more. I know that Minister Radcliffe last year got back to me and did report back a couple of times on all these meetings he was doing. It is just that at that time we did not get into the whole idea of whether he should be doing some checking on products and whether he should be holding press conferences and so on, but it seems to me that that is the logical thing to do, so that at least at the end of the day, one year from now, you do not have me asking you, assuming you are still here and I am still here, that is, but I do not have a situation where I am asking you: why did you not foresee this, why did you not foresee that?

At least you will be able to say that I did all the checking at the time and my best information at the time was that there was this problem or that problem. At least you put yourself in a stronger position on the issue.

Has the minister met with the federal Y2K co-ordinator? The federal Y2K co-ordinator was here last spring when Minister Radcliffe was still the minister, and I do not think they met at that time. I would like to know, in the year since, have you met with the federal co-ordinator, and, if not, why not?

Mrs. Render: I do not know for sure, but I do not believe the previous minister had met with the Y2K officer, and, no, I have not either.

Mr. Maloway: Then would the minister endeavour to contact the Y2K co-ordinator and arrange a meeting with the co-ordinator? I found the person to be quite well informed on this issue, and, in fact, the Y2K co-ordinator for Canada was extremely interested in meeting with anybody who wanted to meet with him. He was interested in meeting with MLAs, was interested in meeting with cabinet ministers, so, unless he has changed his mind in the matter, I am sure that he would be willing to meet with the minister on this.

Mrs. Render: Mr. Chair, I thank the honourable member for his suggestions, and we will be following up with the federal government the inquiries that we have made and will certainly continue to make inquiries and see what more information we can gather.

Mr. Maloway: Well, I think since the Consumers' Bureau is represented here, we probably should deal with some issues in the Consumers' Bureau, and then we can come back to it at a future date if we have some more questions.

The problem, I guess, that we have is our annual reports are always a year out of date, so basically we would be looking for some updated information on a number of these areas. But, on a year-to-year basis, what sorts of trends are developing now; what is the Consumers' Bureau finding in trends compared to the year before? I noted that certain types of offences, non-compliance, some were up and some were down over last year. Looking at travel agents here, we have the number gone up from 27 in 1996 to 89 in 1997-98. I assume that has to do with Mr. Canada, but I cannot be sure exactly. So, if the minister could take a few minutes and come up with some detailed answers on that, that would be fine.

Mrs. Render: The complaints are broken down into three areas, as I am sure the honourable member knows: one having to do with motor vehicles; second, home improvements; and other. The automotive has the bulk of the complaints; again, home improvements is next. There actually was a decrease in complaints in the automotive.

Just for the member's information, the number of automotive complaints for 1997-1998 were 295, and for 1998-1999, they were 235, so there was a decrease in complaints. The same, interestingly enough, with sport machines. In 1997-98, there were 13 complaints, and in 1998-1999, there was a small decrease: they went down to 11. Now, the home improvements–

Mr. Maloway: Mr. Chairman, the minister is giving information from the 1998-99 report? Oh, I see, okay, perhaps you could go back then to the beginning, and I could just make a note of these from automotive. Because from automotive you started with 319 complaints in '96-97, then you would drop to 295 in 97-98, and I assume you are giving me '98-99, but I did not write it down.

Mrs. Render: Yes, you are correct. I was giving you the '97-98 and then '98-99. Okay. Do you need those numbers again? Okay. The automotive–no?

Mr. Maloway: Yes.

Mrs. Render: For the '97-98, there were 295, and for '98-99, there was a decrease to 235. Then, for sport machines, a very small decrease: '97-98 was 13, and '98-99 was 11. The next area where there were the bulk of the complaints were the home improvements. In '97-98, it was 160 complaints, and '98-99, 163.

Mr. Maloway: Could the minister proceed further then to the area under travel agents, because '96-97 there were 27 complaints, and then it rose dramatically to 89 in '97-98?

Mrs. Render: Yes, 1997-98 was 89; 1998-99, a huge drop, it was down to 31.

Mr. Maloway: Could the minister give us in as much detail as possible the reasons for the increase and then subsequent reduction and explain that whole situation?

Mrs. Render: The 1997-98 number of 89 and then the decrease the following year, likely the reason why the 1997-98 number was so high was because that was the year there was a travel company that failed.

Mr. Maloway: That is kind of a short answer. I was looking for a more extended answer than that. I know she is talking about Mr. Canada. That is probably the company that we are talking here. I would like a whole history of that as to why we have 89 complaints that year.

Mrs. Render: I have been advised that under the act there is a confidentiality restriction, so I really cannot talk specifically about a certain company. I can tell the member that the Manitoba clients to my knowledge were either reimbursed or a substitute product was given to them.

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Mr. Maloway: I do not know why there would be such a reluctance to talk about it. It was in the newspapers, well reported, well documented. The problems of the company started, came about or became big information in Saskatchewan. Surely we can explain how it started and how it developed and what the resolution was. I mean, what is the secret?

Mrs. Render: Again, I can only repeat that the legislation does specify confidentiality, and what was in the newspaper, I do not know how accurate it was. Obviously, we know that newspapers get a hold of information that perhaps sometimes they are not supposed to, but, as the minister responsible for overseeing the act, I do not think I am in a position to breach it knowingly.

Mr. Maloway: Could the minister tell us how much money was lost in total by these 89 consumers?

Mrs. Render: The average claim was about $100, but, again, for Manitobans, they did receive their money back or did receive another trip.

Mr. Maloway: Well, then, how did that happen, because the company went bankrupt? How did the 89 people manage to get $100 and/or another trip out of it? How did that happen to materialize?

Mrs. Render: I am afraid the honourable member is not going to be too happy with my response. I am just advised that this is something that I cannot put on record, simply to say that the Manitoba customers were satisfied with the assistance that the Consumers' Bureau was able to give to them.

Mr. Maloway: Would the minister then say that all 89 of these people were completely satisfied with the resolution of this matter?

Mrs. Render: I think the honourable member has probably answered his own question off the record there. I was listening with one ear over in this direction. The Manitoba consumers, I think it would be correct to say that, yes, they were satisfied, but they did not make up that figure that the member is–the total figure. I believe there were some out-of-province people in that figure that the member is putting on the record, so I cannot really speak for them.

Mr. Maloway: For clarification, then, the 89 people, I would understand, would be Manitobans, and there were another several hundred people maybe from Saskatchewan that were affected by this? No?

Mrs. Render: No. I am advised no. Some of the complaints may have been directed to another company, not just to the one company that the member has referenced.

Mr. Maloway: Now I am even more confused. There are 89 complaints for that year, right? Are we saying there are more than 89 in total? [interjection] There is not. There is a total of 89 and some of them are split between–well, they could be split among all kinds of companies. I guess that is what you are saying. So we are not saying they are all Mr. Canada related; that is what we are saying. We are saying they are not all Mr. Canada related.

Mrs. Render: The honourable member is correct.

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In Manitoba there is just no protection. If you live in Kenora and you bought it in Kenora, you simply go and collect your reimbursement from the travel fund of Ontario, funded by the agencies, the airlines and the suppliers. I would like to know why this is not reality here in Manitoba. After 11 years of this government and probably another 11 ministers, we still do not have a travel act in this province. What is holding you back?

Mrs. Render: I suspect that the honourable member knows that legislation governing the travel industry had been contemplated by the province in the early '80s. Then it was not proceeded with because it was felt that the travel industry in Manitoba was too small to support the establishment of a travel insurance fund, and default insurance to protect the travelling public was available from insurers offering travel plans.

I am advised by the department that that answer really is still correct, although I will say to the honourable member that the department is talking with, because we always want to make sure we are reaching out and perhaps just keeping ourselves advised–we are talking with some of the other departments to see whether we should be doing something more. Now, at the request of the Association of Canadian Travel Agents (Manitoba) in June 1998, the previous Minister of Consumer and Corporate Affairs and the Minister of I, T and T did meet with the Association of Canadian Travel Agents, with reps from that association, to discuss various issues facing the travel industry, and whether or not there was a need for any type of regulation.

It is not that it is a dead issue. We are looking at it to see whether it is something we should be doing something more on.

Mr. Maloway: Could the minister tell me what the results, or tell us what the results of that meeting were, the meeting of June '98. What got resolved?

Mrs. Render: The Association of Canadian Travel Agents hired a consultant in the fall of 1998. They conducted a survey to collect information regarding consumers' understanding and expectations of the travel industry, as well as concerns related to the protection of funds and responsibility for accountability within the travel industry. The survey results reported recently indicated, I guess you could say, a need for more information and education about the travel industry and did demonstrate that consumers are concerned about protection of travel funds, suggested that the travel industry is responsible to provide assurance to the travelling public.

I think it was ACTA that initiated a program to–I have been advised that I, T and T did provide funding to ACTA to initiate a program to educate travel consumers in the industry and the questions they should be asking of their travel advisors. There are a number of these kinds of education initiatives that will be ongoing, I suspect.

Mr. Maloway: How much money was given for this study or this grant?

Mrs. Render: We do not have that figure here with us. It comes from I, T and T.

Mrs. Render: Yes, the member is correct. There is discussion. I would say driven by both the department and the industry itself.

Mr. Maloway: Mr. Chairman, does the minister then envision a travel act with a trust fund component to it?

Mrs. Render: I think you and I will have to be back here at the table next year before I can answer that. I think it is premature to give an answer. We just do not have enough information to know whether legislation is warranted at this point, or what route to go to best advise the public.

Mr. Maloway: I was planning to ask the minister, then, what the timetable was, what stage we are at, when we will be meeting next, and what the agenda and the schedule are for this discussion.

Mrs. Render: I am advised that we do not have a firm timetable, but I will be meeting with the industry.

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Mr. Maloway: I would like to suggest to the minister that I know the argument, that the old arguments were that the industry was too small. She mentioned that in her answer, but the minister knows that when it came to the lemon law, for example, that is one example, it was successfully negotiated among the ministers for all the provinces–right?–where they developed a national program.

Perhaps something like this might be looked into here, developing a national program, given that we have Ontario. Am I correct–is it Ontario, B.C. and Quebec? Those are the three. So what you have is you have a population of 30 million in the country, and you have Ontario, Quebec and British Columbia. So the three biggest provinces are all governed by these acts, and you have seven provinces, with nowhere near the population of the top three, outside the act. It would make sense to me that you would have a sort of a national pool be set up. Take the best from each of the acts that have been around a number of years now, and simply have Manitoba sign on to a national plan.

I wonder if that is possible, or do we get into the parochial arguments about jurisdiction and stuff like that? Let us face it, we are looking at internal trade. We have a free trade agreement that makes it easier to trade internationally than it does among provinces, and the federal government and the provinces have been trying to address that issue. You have an agreement now, an internal agreement, on trade. Does it not make sense that perhaps a consumer in Kenora should have the same footing–or a consumer in Winnipeg should have as good a footing as a consumer in Kenora?

Also, you have to understand, too, that we are dealing with national companies here. Sure, you can argue there are some independents, but, by and large, the majority of the industry is either dealing with huge airlines–you are dealing with huge airlines here; you are dealing with national chains when it comes to travel agencies; and you are dealing with national tour companies. You have a consolidation in that business as you have in most other businesses over the last few years.

The consolidation is becoming even more so, with fewer and fewer players, and so companies are operating tour companies right across the country, in all the provinces. So I can imagine that internally, they must be seeing some level of inefficiency here whereby if you are a national tour company, you have to employ somebody who understands the Quebec travel fund and somebody else to understand the Ontario travel fund and somebody else to understand the B.C. travel fund and try to adjust by depending on where the consumer lives.

I think it would be in the interests of some of these national companies, too, to have a consistent level of regulation across the country. I would like to ask the minister if she has been looking at that area at all.

Mrs. Render: Mr. Chair, yes, just to clarify the record, the member was correct when he said that British Columbia and Ontario and Quebec did have legislation and regulations in place. Many of the points that the member has put on record are certainly, I think, valid points. This is an ongoing discussion, and we certainly take your points and continue having discussion, possibly a prairie association. As I say, it is a little bit premature to say definitely.

Mr. Maloway: Mr. Chairman, well, I understand it is a bit of a bigger gamble and a bit of a shot in the dark to try to get the whole country on a program, and we may be all very old people by the time some of these things develop. Unfortunately, what has to happen or what usually has to happen is there is a major insolvency and thousands of people are stranded and then the action comes about. Right? That is what usually precipitates action, but I guess it is not too early for the minister to take the initiative and bring in her own act and, once you have your own act in, to merge it or meld it into a national program.

This issue has been outstanding now for quite a number of years, and I know that 10 years ago there was a lot of resistance on the part of the industry members. They were really resistant to that idea. So is the minister suggesting that there is not the level of resistance that there was before?

Mrs. Render: Mr. Chair, certainly, ACTA is interested in this.

Mr. Maloway: Mr. Chairman, I wanted to put it in sort of a historical context because I recall that the industry on the eve of the 1990 election was sending me demands to meet with them. You know, they did not show a big interest in it before that, but, all of a sudden, they were really interested. They were really hot on the idea of trying to pin me down on this travel act. The meeting never happened, but I remember them being quite excited about it. Certain members of the organization were putting a special effort into this thing.

Now, I know people change, personalities change, over all these organizations and so on, so I just wondered whether there was a different sort of a leadership over there now and a different approach to this issue because certainly they were just dead set again this idea. They were quite content to have regulation up to the Ontario border, but not in Manitoba.

Mrs. Render: Mr. Chair, the ACTA members are interested, but not all the travel agents are part and parcel of that association. I think there are changes in the industry. I think the industry is undergoing some changes. As in anything, there is always a change of viewpoint, but I can only really speak to the association, which, I believe, is most interested.

Mr. Maloway: Well, it seems to me that it would be a decent investment. I know they were concerned about costs to them, and that is a fair concern on their part. On the other hand, there are some benefits to them, too, because if the public is more at ease in dealing with them, then why would they not look at something like this?

I should not say I am encouraged. I expected that there probably would not be anything going on, so the fact that they are even talking about it is kind of a bit of a shocker. I just cannot get used to all this change, but, anyway, I wish you luck with that.

I would like to ask about prosecutions then. Have there been any prosecutions concerning these 89 complaints regarding the travel business?

Mrs. Render: The answer to the honourable member's question, were there any prosecutions, is no.

Mr. Maloway: Have there been any prosecutions at all in the last year in any area?

Mrs. Render: Yes. In 1998-99, there were a total of 38 charges that were laid against various individuals and companies for breaches of consumer protection statutes. This included 21 charges of committing an unfair business practice; that fell under a particular subsection of The Business Practices Act.

There were four charges of direct selling without a licence, and this fell under a particular subsection of The Consumer Protection Act. There were two charges of direct selling under, again, a subsection of The Consumer Protection Act, and 11 charges for breaching another section of The Consumer Protection Act. This was for collecting fees for a prepaid service in a manner prohibited by The Consumer Protection Act. There were also three arrest warrants issued to individuals charged with violations of The Consumer Protection Act and The Business Practices Act.

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Mr. Maloway: Could the minister give a little more detail on these charges as to what the circumstances were for each one of them?

Mrs. Render: I do not have that information. We do not have that information here in front of us, but if the member would like to have the information provided, we can get it for him.

Mr. Maloway: Yes, I would appreciate that. I would like a breakdown of all the charges and what the resolution was at the end of the day, the complete picture. Give me the whole story.

Mrs. Render: We will try to provide as complete as possible. Obviously some of them will not be resolved. As I say, we will give you what we have.

Mr. Maloway: I would like sort of a progress report on them, if they are not resolved. I assume some of them may be related to loan brokers. Am I correct with that assumption?

Mrs. Render: Yes, the honourable member is correct. Three loan broker companies were investigated under The Business Practices Act. Actually that was almost three years ago in 1996.

Mr. Maloway: Has there been any recent activity in this area with regard to loan brokers, or did you solve the problem when you charged and convicted all of the people at that time?

Mrs. Render: I think the member is correct again. It seems that problems with loan brokers have not surfaced since this very successful investigation was undertaken.

Mr. Maloway: I assume that there have been other activities that have surfaced to take their place and keep your staff busy over there. My guess is there is an issue now dealing with the sale of telephone, I guess it is long distance packages. Yes, it would be long distance charges that are being sold by a multilevel marketing operation. I would like to know once again who is involved in this and at what level is it operating? Has it been around a long time? A short time? How many people have been signed up to it? Is it working well? What has the department done with regard to this company?

Mrs. Render: I am not too sure how to answer this question because I think the member is probably talking about the Excel Telecommunications. I cannot really say too much. It was licensed as a vendor by the Consumers' Bureau in January of this year. Your question sounded as if you were talking about a scam. Now, yesterday, you were asking questions about multilevel marketing.

Mr. Maloway: What I am asking the minister is we talked about the loan broker situation. I understand that there has been some interest in the department in a whole range of areas. One of them would be the selling of long distance packages. I want to know, one, are they interested in it, and two, have they done anything about it? Have they approved it? Maybe it is fine. I am not sure. Tell me what the story is.

You are saying in January the company has been registered. What has happened since January?

Mrs. Render: Yes, as I mentioned, the Consumers' Bureau did approve, did issue a licence because Excel was selling at the multilevel marketing scale. I think you are trying to find out if there are any scams involved.

Mr. Maloway: Yes, if they are approved.

Mrs. Render: Yes, it has been approved. I have been advised maybe what I should do is Consumer Affairs has put together just a small paragraph, so if the member would allow me, I will just read this: under The Consumer Protection Act the Consumers' Bureau licenses vendors who are direct selling their goods or services to consumers. A number of these vendors market their goods or services by means of a multilevel marketing plan. When a vendor selling in this way applies for a licence, the multilevel marketing plan is reviewed and an advisory opinion from Industry Canada may be required to ensure the plan is not a pyramid scheme. If the pyramid schemes are identified, then these are referred to the appropriate enforcement authorities for investigation.

So Excel Telecommunications (Canada) Inc. is a company which sells long distance services to consumers by means of a multilevel marketing plan. It was licensed as a vendor by the Consumers' Bureau in January of 1999.

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Mr. Maloway: Can the minister tell us how many licensees this company has?

Mrs. Render: We do not have a number here in front of us. We can get the number for the member, but we believe it is over 300 have been licensed.

Mr. Maloway: I am just wondering whether that would be considered quite a high number relative to other companies, other similar companies, that are operating out there. I would also like to ask the minister how many other multilevel marketing companies are operating in businesses such as this. Is this a growing industry or stable?

Mrs. Render: I guess 300 could be considered a high number. Whether it is a high number for the telecommunications area, I am not too sure. Your second question was how many multilevel marketing licences. We do not have a number with us. We probably could get it.

Mr. Maloway: I guess what I am trying to pick up is whether there are any trends here, whether there were zero a couple of years ago and now there are 500 of them, or whether there are three or four, three or four years ago, and still three or four of them are operating. Do we have a large number of these companies?

Mrs. Render: I am advised that there does not appear to be a trend in multilevel marketing. I think probably all of us are aware of the companies that market vitamins and supplements and things like that, but there does not appear to be a huge number coming on to the Manitoba market.

Mr. Maloway: Could the minister then provide us a list of the companies that are currently licensed, or the products that they sell?

Mrs. Render: I wonder if the member would clarify. Are you just talking about the multilevels or all vendors? I ask the question just because our staff do put in full days, so I do not want to ask them to do anything extra.

Mr. Maloway: I am interested in knowing just the multilevel marketing schemes. I guess what the minister has said is that each of their plans are submitted to Industry Canada. Industry Canada determines whether they are operating according to your rules and regulations and not illegal under the Criminal Code or any other statute, but then you approve them.

Mr. Maloway: That brings up an interesting issue then. How do you know whether the operations of the company are above board then unless you do more investigations? If you simply take their plan as submitted and submit it to Industry Canada if you are suspicious of it but keep it to yourself if you do not, how do you know that the operation of the company is being done properly?

I draw your attention to a case a few years ago where one of these multilevel marketing operations were selling gold coins, I think it was. On paper it all checked out. They are not stupid people. They usually are smart enough to take it to a lawyer. A lawyer looked at it and said, yes, this conforms with Manitoba laws. In that case I think it was B.C. law, and they went happily about their way of recruiting people and calling meetings. They had meetings I think at the International Inn. The police went in there and recorded their presentation and arrested and charged a large number of these people. That was in about 1990, 1991, something like that.

Once again, we had a case where technically their plan was legally and technically correct. It was not considered illegal. Sending it to Industry Canada would not get you anywhere at all. What got them was the method of selling the product. The way they sold it was illegal, and they closed them down that way.

So I guess what I am asking is, are we really in sort of a feel-good situation here where we find these people–I do not know whether they come to you or you go and chase them down. I imagine it is a combination of both. I do not imagine they all come knocking on your door, but one way or another, you do get in contact with them and they submit–what? They do not fill out an application with you, or do they? Then they submit their marketing plans. How do you know that you have all their marketing plans that they submit? Then you make a decision at some point. Who makes the decision as to whether this one qualifies and that one does not?

Anyway, I wanted to leave enough loose ends here for you to go on at whatever length necessary to give me as thorough an explanation as possible on this point.

Mrs. Render: I think the member may have answered part of the question himself when he gave his example about going to Industry Canada would not have put a stop to that particular thing. I guess I would say to the member that the experience of the staff is what determines whether or not they discuss or send an application on to Industry Canada.

So I will back up a step. The vendor, whatever you want to call, whether it is selling vitamins or whether selling gold jewelry, whatever, does complete an application. The application is signed off either by a manager or by the director herself, and as I say, the experience of these individuals I think has been such that they know when to send an application to Industry Canada if they think that there might be a problem.

Also, there is a bond required, so that if the company fails there is recourse for the consumer and we can make a claim.

Mr. Maloway: So is the minister saying that when the company is approved, the company itself provides a bond? Does the bond cover each of the direct sellers that are licensed?

Mrs. Render: The bond is for the company, and the company is responsible for the direct sellers. So if there is a problem, you go back to the company and claim.

Mr. Maloway: So let us take this example of Excel communications then. Excel communications would provide a bond. What is the form of the bond, and how high is the bond? I would like to further just suggest for further clarification that I think what we are interested in here is the formula for the bond. Is it based on so many direct sellers? Is it based on the volume of sales anticipated or expected? What are the criteria for deciding how big a bond this company should have?

Mrs. Render: Again, the member answered part of his question. As the member likely knows, when you go for bonding, it does not really matter what business you are in, your bond is determined by a particular situation. In this instance, I am advised that it depends upon the number of sellers, the average amount or the average value of sales and the annual amount of sales. So all of these things are taken into consideration when setting the price of the bond.

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Mr. Maloway: So basically the bonding requirements then–is it left up to the discretion of the Consumers' Bureau to decide how large the bond is, or are there some written rules as to if you do this then you must have a certain-sized bond? How big do some of these bonds go?

Mrs. Render: Yes, it is left up to the discretion of the managers or the director, and the bonds can go from between 5,000 to over 100,000.

Mr. Maloway: I know that bonding has something to do with the experience in the business too, so I do not know how they would get a handle on the experience. We are bonding the company here and we are bonding the salespeople, is that correct?

Mrs. Render: Bonding just the company.

Mr. Maloway: So then how does it happen that the bond can be called in or collected on then, and what experience do you have in recent times of bonds being called? What is the procedure here for calling the bond? Does one of the salespeople get into some sort of trouble with one of the customers and then the customer goes after the salesperson and the company bond is called in? Is that how it works here? What triggers, and by way of experience, what recent past experiences do you have where bonds have proved useful and have been called in?

Mrs. Render: Usually the Consumers' Bureau becomes involved if there is a complaint from the customer. That is what triggers things. At that point the Consumers' Bureau steps in. If things are not resolved, then they call the bond. Now just to give the member some numbers here, in 1998-99, two bonds totaling $85,000 were forfeited. In addition, a total of $3,526.19 were paid to five consumers from bonds which had been forfeited in prior years.

Mr. Maloway: Could the minister explain that again? I think she said that $89,000 was paid out. What were the circumstances of the $89,000 payout, and what is the significance of the $3,000 settlement?

Mrs. Render: There is a two-year discovery period, so the $85,000 that I referred to is held. That $3,500-plus that I talked about does not come out of the $85,000 that is being held.

Mr. Maloway: I would like to ask the minister what the significance of the $85,000 is. What was the company that was involved in that and the type of business they were involved in?

Mrs. Render: I have been advised, again, I cannot give the member the names of the companies. The companies have shut down. The bonds are being held for two years.

Mr. Maloway: It is not a trick question; I am not trying to trick the minister. In the case of the travel company, I told you what the name of it was; I was not trying to trick you into telling me what it is. I knew it before. What I am trying to find out here is to get the type of business that this company was involved in, whether it is vitamins or something else. I am not expecting to get the details as to the exact name of the company, but just tell me the type of business, the scope of the business, how many direct sellers there were, the area of operation, the scope of operation, all the details you can about this company.

Mrs. Render: We will have to get back to the member.

Mr. Maloway: Could the minister give me then an indication of what other areas of problems that her department has had in the area of direct sellers and direct seller applications and direct seller, multilevel marketing, I guess that is the best way to describe them, companies over the last while? We have dealt with this Excel communications, and the minister tells me that they have 300 direct sellers. They are bonded, so, as far as we know, everything is going fine with them. What about some other companies that are operating right now and over the last year?

Mrs. Render: Again, I am advised that nothing comes to mind. There appear to be no trends in this area.

Mr. Maloway: Could the minister tell me what is happening with the organization known as the Community Party? She probably has a file or has some information that she can tell me about this particular organization. We know that its plan was referred to Industry Canada, so I would like to know what her department is doing about this problem.

Mrs. Render: I believe the honourable member was in the Consumers' Bureau and was advised two months ago now, almost two months ago now, that this really was a pyramid scheme and as such fell under the jurisdiction of the police because it was an offence of the Criminal Code. So it has been turned over to the City of Winnipeg Police.

Mr. Maloway: So the minister has nothing more to report at this time then regarding that particular situation.

Mrs. Render: That is correct.

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Mr. Maloway: We dealt with the area of the loan brokers, we dealt with pyramid or multilevel marketing arrangements.

Periodically, the old subject of fitness clubs surfaces, and I would like to ask the minister just what has she done to try to guard against any future problems. It never fails to amaze me how much interest is generated when one of these clubs go under. It is a very popular activity these days for people to join clubs to get in shape when, in fact, it might be a lot cheaper just to go out and walk along the river during the lunch hour, but people do join these clubs at fairly high entrance fees.

What happens is, in order to entice–and there is a very tough competition in the field. What happens is people keep disregarding the rules that exist, and they pay these clubs annual fees. The rules that we have set down long ago are that the fees have to be paid and cannot be paid up front for the whole year, but clubs manage to avoid and entice, I guess, people into making up-front payments. What happens? Everything goes fine until the club goes out of business, and we have people phoning to complain that they have paid and they have no facilities.

I would like to know just what is happening with that, because the last time we had one go under was I believe last year, and a number of people were out of money at that point. We suggested to the minister that he meet with the remaining clubs and that he make some effort to make sure that they understood that they could not collect up-front fees for the entire year, that perhaps people should be paying on a monthly basis to make certain that they did not lose money in case of a failure. So I would like to know just what if anything has been going on with this whole issue since last year.

Mrs. Render: Four charges were authorized by the Department of Justice under the prepaid services provisions of The Consumer Protection Act. This matter was concluded in March of this year, and it resulted in fine and restitution orders being given to four consumers. Since December of last year news releases have been issued and particularly just before Christmas, I guess you could call them educational issues. One was titled Check Refund Policy to Avoid Return Problems, also informing Manitobans when joining fitness clubs to be aware of the rights when signing prepaid service contracts. You are talking I guess mainly about the fitness clubs, so I will just focus on that particular part.

Your question also, what else are we doing, not only have we sent out releases to again alert the consumer before he or she buys a product, but also we have sort of put on notice–maybe that is not quite the right word. Fitness clubs were advised in writing by the Consumers' Bureau of the amendments that went into place last year and reminded of their obligations under The Consumer Protection Act. So we have tried to cover off both the fitness clubs and alert them as to what their requirements were and also tried to advise consumers of the questions they should be asking before they sign on the dotted line.

Mr. Maloway: The minister recognizes, I am sure, that this problem is not just peculiar to fitness clubs. I think last year we had an ISP go out of business, and the same sort of problem developed there. Have any others gone out of business in the last year? Could the minister give me an update on the state of those?

Mrs. Render: There does not appear to be a significant number of complaints.

Mr. Maloway: The reason I asked was that there are a number of ISPs–one of them went out of business last year, and a number of people lost money as a result. I do not know how many complaints the department received on that issue, but certainly it was a concern. I suppose that when these things happen, there is a tendency to go with the stronger ones, Sympatico probably I would expect being the biggest in Manitoba, affiliated with the telephone system. So I think when people hear that an ISP has gone out of business and left people in the lurch after they have prepaid their fees, then that probably is a big boost to Sympatico's business because they have been around and they are well known.

I know that this is certainly a large area, and the whole technology field changes so rapidly. So I would like to know how many complaints the department got on the one that went out of business last year and whether she has an idea as to how many are currently operating and what the current state of affairs is with regard to the ISPs.

Mrs. Render: The department tells me that they simply have not identified this as an issue because there just are not very many complaints.

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Mr. Maloway: I think that, to a large extent, people take their lumps and they are not happy, but they kind of use it as consumer education, probably no different from what some people are going to conclude when they find their VCRs do not work, may not work January 1. They will just accept that they should have been a little sharper in their consumer purchases. I mean, you recall three or four years ago the red box, blue box, green box recycling companies. I remember paying them for three months in advance or something like that. I learned my lesson that oftentimes prepaid services are not what they seem because it depends really on the solvency and how solid and reputable the company is that you are buying the service from.

You get into the whole area of trust funds again for deposits, because the minister will recall that a few years ago we had a big issue in the province about sunrooms that were being built. Deposits were taken and sunrooms were not finished and were not built and people were out a bunch of money. They came down to the committee hearings here when I believe Ed Connery was the minister in those days. At that time there were quite a number of people who were out money, quite substantial amounts of money too. I guess the public conclude in situations like that, if you can afford a sunroom then, you know, they do not have a lot of sympathy for you.

But we brought the people in here. They made representations to the committee. I introduced some amendments at the time to put these funds in trust. This is not something that is unknown. I mean, when you deal with lawyers your money is put in trust before you buy a property, lawyers trust funds.

Insurance trust funds are supposed to be held in trust, but it is debatable how much that is actually followed because, unlike Ontario, where they follow up and file reports every six months or whatever the amount is, we do not have that. I think it is the law in Manitoba, but I do not know that there is any way of enforcing that. It is an interesting question as to whether or not prepaid or deposits, I guess that is what we would call them, deposits for things like sunrooms and other types, any kind of good or service bought should be held in a trust situation. I would like to know whether the minister has done any–once again, I get back to this planning department. What is this planning department doing? Have they done any work over the last year in this whole area of deposit legislation?

Mrs. Render: We have not looked at deposits. As far as construction goes, under The Builders' Lien Act there is a 7.5 percent holdback for home renovations. If it is a direct sale, there is a bond as part and parcel of it, so there is recourse there.

As I mentioned earlier in response to your question on the fitness clubs, the Consumers' Bureau had been proactive in alerting consumers for the fitness clubs. They were also proactive in advising homeowners when the homeowners were considering doing home renovations. I guess their alert at that time was called right when considering direct sale home renovations.

I happen to have the Manitoba government news release in my hand which–it is just dated not too long ago, April 19, 1999–Manitobans advised to beware of rights when considering direct sale home renovations. Manitobans should know their consumer rights when dealing with direct sales of home renovations, Consumer and Corporate Affairs, Shirley Render, and Minister responsible for Seniors, Jack Reimer, said.

I think we all know that when the weather warms up, that brings an increase in the salesmen coming to the door. That is why the release was sent out in mid-April. The vast majority of direct sale home renovation companies are reputable, but, of course, there are always some that do cut corners or use poor quality materials. So it was felt wise to advise consumers of what questions to ask if you are going to become involved in home improvement contracts, especially if it was at the door.

Mr. Maloway: I would like to ask the minister then: what media outlets and/or newspapers picked up on that press release and printed a story based on that?

Mrs. Render: I do not know that I can answer what media picked it up. I believe it was in some of the seniors brochures. Other than that, I really could not tell him. I really cannot tell the member.

Mr. Maloway: Well, that sort of illustrates, I guess, part of the problem, that it is a nice gesture to send out a press release, but if it does not get picked up then it does not really help matters.

At the risk of getting into trouble here, I am going to suggest that perhaps the two ministers should have had a press conference maybe, look at some sort of advertising. But ultimately, I guess, the problem, the only sure way, and there is a cost associated with it, is to require trust deposits, and even then you are not 100 percent sure, are you, if you have no compliance requirements to the trust funds. So you would have to set up a bigger bureaucracy here and require trust funds and then you would have to have somebody to go out and make sure there was compliance.

But there are several steps here. Even if you took one or two steps and did not necessarily take all the steps, you could work it and phase it in over, say, a 10-year period, whereby initially you considered the legislation at least dealing with some of the more problematic areas and maybe expanding it, phasing in some other areas over two or three years and then have your trust provisions come in perhaps four or five years later and then your compliance come in around that time as well, as opposed to just saying, well, it is too cumbersome and unworkable, which is what was said 10 years ago when we brought in the amendments at the time.

Now, let me tell you this, that at the time I only recall two people, two interest groups, two interested parties objecting, by the way, to deposit legislation. They had really good points, and we put in exemptions to exempt them, and one was monument makers. You know, if you get a funeral monument made for yourself and you are not happy with it, then what is the funeral director going to do with the monument, right? So in that case if you make a 10 percent, 20 percent deposit, that is probably unreasonable because if you do not like the finished product, then he is stuck with the monument. So we took that one out. Maybe custom-tailored suits, maybe it is unreasonable to say that only a 10 percent or 20 percent deposit should be made on a suit; it should be maybe 50 percent or 100 percent, right?

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So there are some exceptions, but clearly when you have businesses operating, when they are taking–you know, I could go down to my office and bring you up the files, but there were $10,000, $15,000 deposits taken on these bloody sunrooms and people, I guess, maybe it was just their own greed to a certain extent but they were given reductions. If you pay it all up front now, we will take a couple of thousand dollars off the front, and these people just basically changed the rules with every case. Some cases they gave them a $1,000 reduction, some cases it was $2,000, whatever was necessary to pull as much money up front as possible. Then what they did was they took the money, basically robbed Peter to pay Paul. You know, they had another job going on, and they simply took the money from one job and transferred it to the other job.

We said, well, there is a problem here. We have to get them to separate the monies. When the minister orders a sunroom, then if she puts up a $5,000 deposit on that sunroom, then that is the deposit on her sunroom, as simple as that, and that contractor should not be able to take her $5,000 and use it to build the Chairman's sunroom. That is just the nature of business, so that is what people do at the end of the day. So what are you supposed to do? I mean, you have to put down some sort of a deposit, and the reality is, you know, you can talk all you want about the 7.5 percent in builders' liens, but if you canvass people almost nobody knows about it. They do not. The awareness of the 7.5 percent is almost nil, and then if somebody does remember it, they forget it very shortly thereafter, and it does not come into play when you are negotiating to build these kinds of things.

Tell me what the difference is between a sunroom contractor and a renovation contractor. There are well-known contracting companies in Winnipeg that have been around 20, 25 years. Do you think they would have a severe problem with this, when every single insurance agency in Manitoba has these rules to follow, every single real estate company in Manitoba has these rules to follow, indeed probably the entire country, that it is just simple accounting? If it is trust funds, you put it in the trust account. If it is not trust funds, you do not put it in the trust account, and you separate the two. What is the big problem here? The industry will complain, of course, because it is new. That is natural, and they think it will increase their bookkeeping. But I can tell you for the long-term preservation and safety of the consumer's money, then this is the one sure way of making certain that you do not have ongoing future problems.

I mean, we probably pay for it in the end because we have all this extra activity in the Consumers' Bureau and at the political stages when one of these things happen. It is almost like playing the lottery or the horse racing here. We just kind of sit back, and we just wait for the next disaster to happen. A whole comprehensive sort of approach to the concept of funds, deposits being held in trust is something that the government should pay some attention to and be proactive with. Just relying on a press release that will never see the light of day is probably not really helping matters any. I mean, it might make us feel good for a day, but it did not get reported and nobody knows about it other than the person that wrote the press release and sent it out, and now I do. That is three people.

Mrs. Render: Well, I take the member's comments; I have listened to them with interest, and actually I am pretty sure I have seen these kinds of comments in the seniors brochures. They are talking about elder abuse, and I am very, very positive that in most of the seniors literature now, they have sections that are directed specifically to seniors, because seniors are usually the ones that are targeted for the home renovations.

In fact, in my door-to-door knocking, I was talking to a senior about this very thing, and she happened to have attended the St. Vital Seniors, and St. Vital Seniors are a very active group. I understood they had somebody come in and speak to them. My deputy is whispering in my ear and saying probably from our department, Consumer and Corporate Affairs.

But, seriously, Mr. Chair, I know that there has been a great deal of effort to make sure that this information is in the hands of seniors. As I say, I have seen brochures targeted directly for seniors, and I think your points are well taken. I also believe that educating the consumer, whether you go in to buy groceries or whatever, we do have to be asking questions and know a little bit more than just simply handing over a chunk of cash or writing a cheque. We have to be alert and aware.

Mr. Maloway: Well, if the consumer was so smart and so educated, he would not be paying for professional advice every day of the week. I mean, that is why we have professionals; we have lawyers, we have accountants, we have all these different professionals. We train these professionals to operate under certain rules and hope that that will solve, I think anyway, consumer problems. So why do we go and train lawyers to become lawyers? We have a Law Society, we have all the little rules of ethics that they follow, and 99 percent of them follow these rules. They have all of these rules of how you deal with the public. If any of them wanted to do bad things, they could, but they do not because they are rooted in the rules and procedures they have to follow. Most of us will follow whatever rules are made for us, right? We assume these rules are there for a reason, and we follow them.

All I am saying is that if you take it from the standpoint, ask any lawyer as to how their system is set up and why they have trust funds and ask any real estate agent or insurance agent how their system works, it is set up to protect the consumer. That is what it is there for. It is accepting the fact that there is going to be one in a hundred or one in a thousand people that are going to abuse the system, so we have to set this thing up. It is an important enough function in your life that you have to make sure that when you buy a house, you know, the real estate agent does not run off with the deposit or the lawyer does not run off with the deposit. Every once in a while it happens, in spite of all the rules. But they are there because the consumer cannot be up on all these things.

That is why the consumer goes to lawyers in the first place, because they accept that things are too complicated, and they have to go to all of these professionals. So you can try to educate them all you want, and I think the intention is good, but at the end of the day you have to have some basic ground rules that these professionals follow to make certain that people get treated fairly at the end of the day.

So if you can regulate these professions like law, real estate insurance, then tell me why it is such a big extension, why it is such a big leap to include, well, used-car dealers, renovation contractors. I mean, why is it such a big problem to move incrementally in this area and have deposit legislation.

Let us say that we say for the year 2000 we are going to select an industry. Look at your list here and see where you have your most complaints, and you say that you are going to trust fund a certain industry, and you are going to start with them and see how that works. Now, you have been in government for 11 years. By now you could have done about 11 different industries. Now, leave your monument dealers alone, right, leave your suit manufacturers alone, and there were two or three other custom business people that did not like this. The rest of the business, a large number of them, will thank you for it. I can tell you there are enough renovation companies in this town that have been around here for a long time that are extremely professional and probably run a trust fund system anyway, if you checked.

If you were to phone Abalon Construction or one of these other big construction firms, I will bet you that they do segregate deposits from their general revenues. I cannot be sure about that. I have done no checking on it, but there is another thing for your department to check out. But why not look at stuff like this? What would be the problem, because it is preventative medicine, is what it is at the end of the day. Look what the real estate–well, anyway, let us leave that for another day. But anyway, I would like to get your response on this whole area.

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Mrs. Render: Well, I am not too sure that the member has convinced me, but he has brought some interesting points, and I am certainly prepared to look at them. I think we have a difference in philosophy, having been on the regulation review committee from the day it was introduced by government, I do not know, back in 1992, '93, '94–I do not remember when it was–to look at regulations to try to reduce the number of government regulations to make sure that we were not hampering business. I would want to look very closely at this to make sure that if regulations or legislation were ever introduced, that it would be done in a way as to not constrict business, it would not be unduly onerous to business and at the same time be useful for the consumer. So I take the member's comments. But as I say, I am not too sure that I am convinced at the moment, but I certainly will discuss them.

Mr. Maloway: I guess in addition to that, the principle here is that the deposits should not be used for the cash flow of the company. It is kind of almost a fiduciary function of the deposit that it should be held in trust, not be used in cash flow, and that the cash flow problem should be secured by a bank loan. You know, it is just normal that the business goes and takes out a bank loan, and that is how they operate. They do not operate on somebody else's deposits. That is the principle involved here.

Now I am not sure whether the Consumers' Bureau deals with things like–well, the franchising legislation, that would not be the Consumers' Bureau that would deal with that. But in the case of Jeffrey Wuckert, can you talk about him or is he on your protected list too now?

Mr. Maloway: I would like to get into the area of warranties, because once again I know that is a problem here. I would like to know what are the problems that the department is currently having with warranties and what is the level of your complaints. Have they gone up, gone down? What types of complaints are you getting? Are people getting satisfaction? What sorts of settlements, if any, have been effected?

Mrs. Render: I am advised that the department does not track complaints by warranty, it tracks by commodity. So we do not have numbers to answer your question directly. The department, if they receive a complaint, will try to mediate and get satisfaction for the customer.

I am also advised that a typical misunderstanding, and I have to confess that I have always thought that I had to do this particular part, if you buy something from the store, and I am thinking just even a small alarm clock or something, that there is that little card that you get and it tells you to fill it out and send it in to somebody who lives in Ohio or somewhere. [interjection] You are on somebody's list, are you? In actual fact the seller is responsible. In other words, I could take that card back to whatever store I bought it from and they are responsible.

Yes, I should clarify. I have actually been told, not by my department, but by somebody at the store, that, in fact, I do not have to send this little card off, that I can send it back to the store that I bought it from, but my department advises me that, in fact, the seller is responsible for the warranty, that if my clock does not work, I take it back to the store that I purchased it from.

Mr. Maloway: That has been my understanding, too. I believe companies treat those mailbacks that people send back as just, well, I guess, as a mailing list probably to sell to somebody else. But at the end of the day, while it says on a lot of them that you must send them back within 30 days or whatever, that, in fact, your warranty is not invalidated, that you go back to your original seller. Now, that is if the original seller is still around. What experience do we have with that?

I know that I bought a fax machine a few years ago for the legislative office from I think Majestic or somebody. Does anybody remember that company? It was the one with the yellow store. It was a national company, a national firm, and one would have thought that it would be around too. But when it came time, when I accidentally dropped it off the radiator downstairs, they were not around. They were not in business anymore. [interjection] Well, I think the warranty–it was a $75 repair job, but the point is that the company was no longer there, you know. So that is a chance you take when you are buying things. I guess that is the problem with warranties overall.

But I want to get into not my opinion of warranties, I want to get into your opinion and experience with these warranties. I have people who complain about these things all the time, and they are not happy. They buy a product, and they say, well, yes, I saved $10 or $20, but when it came to warranties that is when I really found out that I did not really get such a good deal. Surely there is some application here to the BPA, I would think.

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Mrs. Render: I have been advised that really it comes under The Consumer Protection Act, but, again, the director of the bureau tells me that there just have not been huge amounts of complaints, not enough that something is sort of lurking out.

Mr. Maloway: I think that the department probably does not get all of the complaints. That would be my guess, that the reality of it is that at the end of the day they end up choosing other methods. Why, I do not know, but they end up going to lawyers to try to resolve the problem for them. I can take you through case after case after case when that is exactly what has happened. I had a case a few months ago where after three years or so of dealing through lawyers and getting nowhere at the end of the day, I sent the complainant to the Consumers' Bureau and the problem was solved real fast, you know, no lawyers required. But the person did not know to go to the Consumers' Bureau in the first place, right?

So I think there are a lot of warranty kind of problems that people have. There are problems with warranties, but I think people do not automatically think of the Consumers' Bureau as a place to go to solve the problem.

Now, there is no guarantee that if you have a warranty problem that you are going to get satisfaction anyway at the Consumers' Bureau. If the operator or the seller does not want to provide the warranty, then they are not going to co-operate. I mean, the Consumers' Bureau tries to mediate, and if a guy or if an operation, if a business is having financial difficulties or they are just not interested in solving the problems, they are not going to pay much attention to you.

So that is the other problem. Because a lot of these are not expensive, I guess people just finally give up and decide to buy some other brand or deal with some other store. That is their method of dealing with the problem.

There are problems with car warranties. I never advise people to buy car warranties, either new-car warranties or any kind of warranty associated with a car, but some people do that. Who is to say whether–because it is only through the passage of time where you discover whether you are right or wrong. When you go to Future Shop and buy a computer printer or some sort of product, they will offer you a warranty. Well, I can assure you that it is probably not the best thing for you to buy, but at the end of the day, if you have nothing but problems with that machine, then you can get satisfaction and actually benefit at the end of the day. So it is really a crapshoot as to whether or not you are going to benefit. But, in terms of things new-car warranties and things like that, a lot of people do buy them because of persuasive sales techniques, huge commissions associated with these things, that there is real incentive to buy these products and then, when it comes time to collect on the car warranty, the car warranty company is out of business.

Now, surely, there have got to be some better rules for dealing with these car warranties. Now here I do not want to get into mentioning names again, because I do not want to get you riled up about this, but there is a company on Regent Avenue that sells car warranties with its new cars. Basically, they look at your pocketbook and decide the price of the car warranty when they see how much cash you have got in the wallet. They just set up their own rates. If the CBC can be believed, and I believe they can be, they determined that this used car lot was selling these warranties. In some cases they just paid the insurance company a flat net amount, and whatever commission they could tack on top of that was their profit. So, in some cases, it was just obscene profits. In some cases they were making, I do not know, maybe 20 percent, 30 percent, but in some cases they were making 130 percent. They were making a couple of thousand dollars on the warranty alone. That was an issue covered last year on the CBC.

So I want to know what is going on with these used-car warranties that are sold, and could you give me a whole bunch of detail as to how this system works and why it is not working properly?

Mrs. Render: Actually, I would advise the honourable member that the Consumers' Bureau, I think, is very well known. I will just give him a couple of numbers here: 1998-1999, the bureau handled 38,714 telephone inquiries and e-mail inquiries from consumers and businesses requiring assistance. Obviously, the number of complaints registered with the bureau does vary from year to year. So people with warranty problems can come to the bureau. The bureau does mediate, does help. So I would say that human beings by their very nature are not going to go to a lawyer; they are going to go to a service that they can get free of charge.

So I guess I would disagree with the member that, if a person has a problem with a warranty, their first step is to a lawyer. I would say that their first step quite often could be to the Consumers' Bureau. I believe the Consumers' Bureau is well known.

So when complaints about a business are received, the bureau does investigate the company's actions, and in most cases, The Business Practices Act is effective in dealing with unfair business practices committed by the company. Of course, consumers have the option of taking their complaint to Small Claims Court.

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Mrs. Render: A three-week trial has been set for the remaining charges. The trial is scheduled for November. Again, this company has been restrained from doing a number of things: (1) having consumers sign blank documents; (2) having consumers sign more than one offer to purchase for a specific vehicle; (3) advising that ALC requires no deposits on approved credit for selling warranties unless payment and/or a registering warranty are submitted with the warranty company; (4) refusing to refund deposits given by consumers after deposits are refundable. There are a couple of other things that they have been restrained against. I could continue, but I think–okay. Changing the terms of an offer to purchase without the consumer's knowledge; and advising consumers that their credit has been approved unless it is able to show the consumer documentation that it has been approved.

Mr. Maloway: Well, I mean, this, to me, sounds like a pretty out-of-control situation where we are not talking about one or two remedies here. We are talking about the whole book of problems. So I would like to know what sorts of guarantees do we have, does the consumer have that there is compliance with these requirements.

Mrs. Render: I have been advised that under the act we cannot shut down a business. We can investigate the complaint, but we cannot shut down a company.

Mr. Maloway: I would like to ask what form of compliance then does the department have, not with regard specifically to this case, although it could apply to this case, too. If the department has taken action in a case, then does it have a system whereby it monitors the offending company or checks into it at periodic times in the future, once or twice a year? Does it have any kind of follow-up to make certain that what it has investigated is resolved permanently?

Mrs. Render: No, we do not have a monitoring system, but if another complaint does come forward about the company, then we go back and investigate, and, of course, the complaint would be forwarded to the Justice department for further consideration and laying of further charges against that company. I have also been advised that that would include contempt of court, because they would be in breach of the injunction, at least the orders that had been set down.

Mr. Maloway: So essentially, then, if this used-car dealership on Regent then just goes back to its own ways and does not follow any of the recommendations here, or orders, then there is really nothing the Consumers' Bureau can do outside of waiting for another complaint to come through.

Mrs. Render: That is right. Unless a complaint comes through, if they are operating properly, then that solves the problem, so if a complaint comes through, the bureau steps in and, as I say, goes back to the Justice Department, and that triggers more action.

Mr. Maloway: I am wondering if there is any jurisdiction here for the Insurance Bureau, because these warranties, I assume, are backed by insurance companies. I have never bought one, but I assume that they are.

Mrs. Render: I am advised that some are underwritten by insurance companies. Of course, if there is a problem, then the department will take it up with the insurance company and again step in and try to resolve the problem.

Mr. Maloway: Was the insurance department involved in this particular case the company on Regent?

Mrs. Render: No.

Mr. Maloway: And why not?

Mrs. Render: The warranty was not in effect in this particular instance.

Mr. Maloway: So it essentially became a self-insurance proposition then where the guy was collecting a premium based on something that did not exist. He was the insurer. Is that what you are telling me?

Mrs. Render: If I am understanding this correctly, the problem was that the customer handed over the money, but the money was not handed over to the warranty company. So the warranty was not in effect. So the customer had no warranty.

Mr. Maloway: Right, so in a way Mr. Tiwani then became the insurance company. Is that what you are telling me or no, or there was no such thing as a warranty? Why are we talking about warranties if it was not a warranty?

Mrs. Render: Perhaps it would be better explained by saying, if the money never went to the insurance company, that is why the Consumers' Bureau was involved, because it was a case of fraud, unfair business practices.

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Mr. Maloway: So the question is was their policy enforced then? How would the Insurance department interpret that? The customer paid the money to I assume a registered car dealer, right, somebody who is registered. I would think that the insurance company would be responsible for any claim, assuming that Mr. Tiwani is the agent of the insurance company. Then why would he not be?

I can tell you that if it were a general insurance kind of question, then certainly the company would never get out of paying the claim. The consumer will get its money, get it from the insurance company and they will chase the responsible party. That would be my guess. Am I wrong here? I do not think so. I hope not.

Mrs. Render: The answer to the member's question, we do not know that it was an insurance issue; it was an unfair business practice.

Mr. Maloway: Well, then, the warranty companies, the insurance companies that back these warranties, are they registered with the Insurance Bureau?

Mrs. Render: We do not know what companies are involved in underwriting warranty companies.

Mr. Maloway: Well, I was making an assumption which I guess maybe I should not. I assumed that all the life companies are registered, and they are either registered federally or provincially, federally and provincially, you know, different combinations. They operate in various provinces. They are all in a book, and you can get their underwriting results, and you can get their presidents' home phone numbers–well, not quite that far, but you know, the name of the president and the operating officer. So that is there for the life companies; it is there for the P and C companies, all 100-plus of them.

I have just never seen any specific car warranty companies listed anywhere. I assume they are just some life insurance companies that want to write auto warranties. I have never bought one of these things, but surely if there is an insurance company operating in Manitoba, it should be registered with the Insurance Branch. They should know who it is and what they are doing and their premium volumes and how many agents and how many customers and all the whole financial detail. So if it is not the case, then I would like to know why it is not, and I am sure there would be good reasons why it is not.

Mrs. Render: I will answer part of the question. Yes, the member is correct. Any insurance company which is operating in Manitoba is registered. We know the volume of business.

Our records do not indicate that, but if somebody bought a warranty they could check with the Insurance Branch to find out–if the company underwriting the warranty were registered here in Manitoba, then we could give information that way.

Mr. Maloway: I just happen to have a 1998 annual report of the Superintendent of Insurance here, but it only goes up to 1997, and I do not see any company that is specifically selling car warranties here. Presumably there would be something called the car warranty company of wherever. I do not see anything like that. So my assumption is it is being written through one of these other companies as kind of a sideline that they are doing, and that is how they would get around the registration side of it. But surely there should be some indication in here. They have classes of business and so on, aircraft and liability and all the different classes–marine–that they write, and I know I have never seen any section that says car warranty business.

My assumption is that it is a jurisdictional question; it probably deals with some other area. For example, there is self-insurance on tombstones in one of the cemeteries. I do not know whether the minister is aware of that as far as the insurance is concerned, but I know that when I had a complaint about it about 10 years ago, when I checked with the Insurance Branch I was told that this was some exception, because there are always exceptions in life, it seems. There was this little exception that had been allowed for the last 20, 30 years whereby this particular cemetery was allowed to run its own little insurance scheme. Kind of a neat little idea if you can do it, but they have been doing it for a number of years, and the Insurance Branch evidently knew all about it. It was all news to me and certainly news to the person that was inquiring, but this cemetery is collecting these, well, cemetery or monument dealerships in the northwest part of the city, was collecting, if you bury somebody in the cemetery or you buy–pardon me, let me start over here.

If you buy a monument from the monument company on Keewatin or that area, they will offer you the ability to insure that monument, and you can pay $10 or $20, and presumably you are getting insurance on your marker, on your monument. That is certainly not a registered insurance company; that is just a little self-insurance scheme. I thought this was something that I had never run into before, but there it was. I assume they have been doing it for a number of years, and they are still doing it today. So what gives? What can you tell me about this?

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Mrs. Render: Perhaps an answer to your comments earlier. I would doubt that the type of warranty we are talking about is a separate classification. So that is why it would not show up. It seems to me, I heard you say marine, so it might be a subsection of something else, but I do not know that it would be a particular classification of business.

Your comments on the cemetery and the monument are interesting to say the least. Perhaps you would bring us some particulars, and before any of us go out and take that big step of getting insurance on our monuments we will better advised.

Mr. Maloway: Well, you know, we have to be worried about confidentiality here, do we not? But I would be happy to give you the information, because I did check for the person that was interested in this a few years back, and we did check with the Insurance Bureau at the time. They had the answers; they knew exactly what it was about. I just thought it was one of the strangest things I had ever seen, but I am prepared to accept that there are exceptions to every rule, and for some reason this company was doing it.

But I thought that it kind of reminded me of something that sort of verged on the betting track, stuff like that, right, where you just simply operate your own little internal insurance company without an insurer, without a registration or anything like that. I believe they were aware of it; maybe they are not, but I will tell you privately what it is, and you can check it out and see for yourself. But that is what I am thinking is that this auto-warranty business may be in that kind of a league. There may be some requirement that does not allow–I mean some exception that they have that they do not have to register with the Superintendent of Insurance, although I do not know why not.

Let me explain further. If it were mainstream, as in the P and C business, then this would be something that would be offered by all the insurance agency force. Correct or not correct? I mean, it would be logical that car warranties would be sold through every insurance agency in the province, and that has never been the case to my knowledge. I mean, you buy them at car dealerships. Car dealerships know about cars, but they do not know anything about insurance. At least that is the theory. I do not know whether that is true or not. But anyway, so car dealerships are selling insurance products. I am sure you have probably had representations in the past about that. Is it an insurance product? Is it not? What is it? I do not know, I am just asking.

Mr. Maloway: Well, you know, hold on here. The car warranty is essentially an insurance scheme, is it not? I mean, it is basically probabilities, right? You buy a warranty–you buy a life insurance policy, you die, somebody else collects. You buy a house insurance policy, you have a fire, you collect. What is the difference here? You buy a warranty, there is no guarantee that you are going to call on the warranty, no guarantee. You have an idea that perhaps you have a certain amount of–actuaries can tell you there is a certain amount of chances that your vehicle is going to break down within the first 100,000 kilometres, and that is how the premium is calculated, and a certain number of people have to replace their transmission under the warranty and certain other people just sail right through.

The insurance company or the company makes money on those who do not make a claim, and they lose money on those who do make a claim. What is the difference? There is no difference; it is the same thing. It is an insurance scheme pure and simple. You cannot tell me it is not. There is absolutely no difference between that and insuring against rain at a ballgame or insuring a house or a life or anything else.

All you are doing is insuring the probabilities of whatever it is, Mr. Chairman. Whether it is a used car or a new car, you are gambling here. It is a gambling scheme; you are gambling against the probabilities of a loss, and you hope you charge a correct premium for it. So that being the case, then why would the warranty company not be registered under the Insurance Bureau? I do not understand why it would not be, and where is the list of these companies? [interjection] They do what?

Mrs. Render: Mr. Chair, again, I guess what I can say is that we simply have not looked at that as an issue, but I would say that is probably the same thing as a warranty with a dishwasher and what not.

Mr. Maloway: Mr. Chairman, well, since we are going to be back doing this again in the near future, maybe we could give the Insurance Branch an opportunity to check into this, come back with all of the information that we are looking for and that is all the names of the warranty companies–well, first of all, the jurisdiction question.

Mrs. Render: Mr. Chair, we do not have the names of the warranty companies. They are not required to register. It does not fall under the Insurance Branch.

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Mr. Maloway: Mr. Chairman, well, then, perhaps the minister could undertake to get an opinion or get some sort of answer as to why it would not, because to me, in a warranty program where you are paying a premium, it is no different than an insurance proposal, that warranty companies–some of them are insurance companies, no doubt about that–so why are they not registered?

So perhaps we could just use it as an exploratory question to get back to us as to what the story really is. I am saying that if you can find out the list of warranty companies that are operating in Manitoba, then it would be nice to find out. If you cannot, well, then, tell me you cannot, but then we will have to find out from some other source as to where we get this information, right? But if I cannot ask you, who can I ask? [interjection] I could ask the Chairman, that is right, and is he going to know?

Mrs. Render: Mr. Chair, I do not know that we are going to be able to get back to you next week with an answer.

Mr. Maloway: Mr. Chairman, leaving the car warranty issue for the time being, I wanted to ask the minister about these new-home warranties and how they are set up. Perhaps the minister could give us some information about the New Home Warranty Program.

Mrs. Render: We are aware of two new-home warranty programs, but we do not regulate them.

Mr. Maloway: Does the minister have any information then as to whether there are complaints made to her department regarding the new-home warranty programs.

Mrs. Render: The act does not apply to real property but, having said that, the Consumers' Bureau always tries to be of assistance.

Mr. Maloway: I guess we can come back to the Consumers' Bureau another day and deal with more outstanding issues. I had not planned to deal with the Consumers' Bureau at all today, but that is okay. I was thinking about that research group again.

Mrs. Render: He was the one that was out of town.

Mr. Maloway: Right. So maybe he will be back on Monday. If we are in session here on Monday, that is a possibility, I suppose, that he will be back on Monday or she will be back on Monday. Okay.

The area of the Insurance Bureau, I wanted to talk about the demutualization process. I mean, there was no interest in this subject two or three years ago when it was first being discussed, and now, of course, there are all these stories in the paper. People are checking their policies to see if they are going to cash in and be able to go out and buy those hot tubs and other products. There are more issues here than just a little temporary boom to the economy with people going out and spending money they got from their whole life or participating life insurance policies. There is a whole question here about whether the control of these companies will, in fact, devolve to outside Canadian interests and whether, in fact, the insurance company investment portfolios will stay where they are, too.

I mean, at the end of the day, I guess, it has been observed that, in fact, the big benefit–I mean, there is a benefit here, I guess, to people that are going to be getting money or shares in these companies, but we cannot underestimate the push here on behalf of the management for stock options and million-dollar salaries, because that is one of the side effects of this move to demutualize.

The insurance companies are trying to tell you that it is a measure that they need to be able to acquire new companies and do new and great things, but what they do not tell you is that, in fact, they are looking at huge salary increases, $100,000 to $200,000 that they are earning in salary, assuming that is what they get, and benefits. They want to translate that into ten times that amount in stock options and be able to golf with bankers that they golf with right now on an even kind of scale on the monetary side.

So this is a fairly substantial issue. So far all we have seen is stories that applaud the move from people who have a vested self-interest in promoting this idea.

Mrs. Render: I just want to mention to the honourable member that under the proposed regime there are a number of elements that the companies have to follow. One of them is that management is prohibited from benefiting from the company's demutualization proposal, just so he realizes that not necessarily are there these leaps in salaries.

Mr. Chairperson: Very quickly, the honourable member for Elmwood.

Mr. Maloway: I would like to see where that is written. I am not denying that the minister is maybe correct in that, but that is not the information that I have. So if she has some information to indicate that is the case, I would like to have a copy of it, certainly check the website and talk to the people in Ottawa about this matter and some people in the industry. That is from people who know more about it than I. That is the observation that I have been given, that it is a lot of this, and I would not say it is all about big salaries for company presidents and executives, but that has been given to me as one of the reasons why there would be this big push.

We can get into this at a later time.

Mr. Chairperson: The honourable minister, very quickly.

Mrs. Render: Yes, we can provide the information for the member.

Mr. Chairperson: The time being six o'clock, committee rise.