House Business

Hon. Jim Ernst (Government House Leader): Madam Speaker, on a matter of House business, I would like to inform the House that the Venture Manitoba Tour's financial statements which had been referred yesterday to the Standing Committee on Public Utilities and Natural Resources on October 17, 1995, at 10 a.m. in Room 255 will instead be considered by the Standing Committee on Economic Development on the same date at the same time as previously announced.

Madam Speaker, would you call Bills 9, 11, 2 and then the balance of the bills as listed in the Order Paper.

DEBATE ON SECOND READINGS

Bill 9--The Wills Amendment Act

Madam Speaker: To resume debate on second reading on the proposed motion of the honourable Minister of Justice (Mrs. Vodrey), Bill 9, The Wills Amendment Act (Loi modifiant la Loi sur les testaments), standing in the name of the honourable member for St. Johns.

Mr. Gord Mackintosh (St. Johns): Madam Speaker, the purpose of this bill I think was described very well by the minister. The Wills Act as drawn up currently is relatively unique to Manitoba. It says that you do not have to comply with all the formal requirements for making a will for the courts to recognize that there is a valid direction or request existing. Now that particular revision, that particular section, I think, was a great contribution to the law of wills not just within Canada, but I think within the common law jurisdictions of the world.

I think it was a great contribution because it said that there was something more important than strict rules. It was more important that the real intention of a person making a will be respected. We recognize that this bill does not have application to thousands of Manitobans, but it can be very critical in certain circumstances. I think it is important that the legal system, the justice system allow access by people to their intentions. The legal system should not be there merely to put up barriers or formalities that can thwart the real needs and the intentions of individuals.

We know that since the provision under consideration was passed by this Legislature, that is, the requirement that strict rules be secondary to the real intention of a testator, the courts gave an interpretation to this section on a couple of occasions. Unfortunately, in 1990, a Court of Appeal in the Langseth estate case appeared to say that some compliance with the formal requirements was required. I think that was bothersome and frightening to those who had seen the provision in the bill--it was actually Section 23--as representing a liberal and purposeful approach to the interpretation of wills because what that decision said was that at least one of the formal requirements required by the legislation had to be complied with, whether that be the signature or the dating of the will or how the will was witnessed. That led to the Law Reform Commission presenting a report to the then-Minister of Justice on December 14, 1992, some time ago, I think unfortunately some time ago.

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In the Law Reform Commission report the commission identified the difference between requiring substantial compliance with the formal requirements for wills that was exhibited in the Langseth case with what I think was truer to the original intentions of the provision, and that is that there be a dispensation power, in other words, the courts be given the powers to dispense with all the formal requirements required for making a will. The Law Reform Commission concluded that The Wills Act should be amended and that the provision under consideration have the wording as set out in this bill.

We support this amendment to The Wills Act. I might add that it appears that the wording accurately sets forth the intention of the original Section 23 and the intention of what the Law Reform Commission set out to do, so we look forward to seeing this bill go to committee, Madam Speaker.

Mr. Kevin Lamoureux (Inkster): This is, in fact, a bill that is fairly straightforward. From what we understand, the bill will allow the law to continue to have the desired effect of insuring that testators' wishes are in fact carried out. This is, in fact, something which has been run by the Law Reform Commission, and at this point in time we do not have any problem seeing it going to committee at this time.

Madam Speaker: Is the House ready for the question? The question before the House is second reading of Bill 9, The Wills Amendment Act. Agreed?

Some Honourable Members: Agreed.

Madam Speaker: Is it the pleasure of the House to adopt the motion?

Some Honourable Members: Agreed.

Madam Speaker: Agreed? Agreed and so ordered.

Bill 11--The Trustee Amendment Act

Madam Speaker: To resume debate on second reading of Bill 11, The Trustee Amendment Act (Loi modifiant la Loi sur les fiduciaires), on the proposed motion of the honourable Minister of Justice (Mrs. Vodrey), standing in the name of the honourable member for St. Johns.

Mr. Gord Mackintosh (St. Johns): Again, Madam Speaker, essentially repeating my comments from the last session, the amendment proposed to The Trustee Act is similar to the intent of the amendment proposed to The Wills Act. Both allow for more liberal interpretation or application of the law to circumstances.

I am familiar with the Law Reform Commission considerations and the report on the topic of what is called ethical investments. Essentially what this amendment attempts to do is allow trustees to make investments on behalf of beneficiaries which do not only consider financial criteria. I think it is much more common today that all of us make investment decisions based not simply on the expected rate of return but on other considerations whether they be religious, whether they be otherwise moral considerations, ethical considerations, perhaps based on environmental concerns.

I know of the offering of what is called green stocks on the market and they are very successfully marketed and I think widely accepted in our community. People are making a conscience decision. They are saying that it is important to invest in this case in sustainable development, important to invest in green ventures more so than it is to get the top dollar that one could get with perhaps some other investment. It is not uncommon for investors now to recognize moral decision making being acknowledged as legitimate.

We have seen, for example, investments avoided in South African businesses in the recent past. That is one example. When we want to invest in certain offerings made by community economic development initiatives or such investment vehicles as the Crocus Fund in Manitoba, it may be that the predominant reason for the investment is not merely financial, but there is a balance that is required nonetheless.

So clearly when one makes a decision for oneself, there is no review, there is no accountability in law, but there is for a trustee, because when one is a trustee there is a requirement that decisions be made with financial criteria being predominant.

Indeed the only measure of prudent trusteeship, this bill says, should not be financial criteria so long as safeguards are in place against an unreasonable financial detriment occurring from the investment. So the provision appears to balance that recognition that nonfinancial criteria has a role to play and should be legitimized. At the same time it appears to be saying that there still must be prudence in making investment decisions by trustees.

We will question and look forward to the presentations and the minister's detailed responses to this bill, and we want to consider further whether the predominant criteria is still financial. I think that is the main question, Madam Speaker.

We support this bill in principle, and we look forward to the committee stage.

Mr. Kevin Lamoureux (Inkster): Again, Madam Speaker, this is a bill in which we do not have any problems in terms of seeing going to the committee as the amendment protects trustees from legal action for reasonable, prudent investment decisions that incorporate other considerations such as the social, religious and environmental factors. In principle, as I say, we do not have any problem with this particular bill going to committee.

Madam Speaker: Is the House ready for the question?

Some Honourable Members: Yes.

Madam Speaker: The question before the House is second reading of Bill 11, The Trustee Amendment Act. Is it the pleasure of the House to adopt the motion? Agreed?

Some Honourable Members: Agreed.

Madam Speaker: Agreed and so ordered.

Bill 2--The Balanced Budget, Debt Repayment and Taxpayer Protection and Consequential Amendments Act

Madam Speaker: To resume debate on second reading on the proposed motion of the honourable Minister of Finance (Mr. Stefanson), Bill 2, The Balanced Budget, Debt Repayment and Taxpayer Protection and Consequential Amendments Act (Loi sur l'équilibre budgétaire, le remboursement de la dette et la protection des contribuables et apportant des modifications corrélatives), standing in the name of the honourable member for Wellington (Ms. Barrett).

Is there leave to permit the bill to remain standing in the name of the honourable member for Wellington? [agreed]

Mr. Jim Maloway (Elmwood): Madam Speaker, I am very pleased to put some comments on the record regarding this bill. I see this bill as one of the more important ones that the government has brought in. The reason I say that is because it highlights the hypocrisy of this government, a government that at any time in the last seven years could have governed itself by bringing in even a surplus budget in each and every one of the last seven years. What this government has done, it has run excessive deficits. In fact, it has increased the debt load of this province by over one-third.

Since this government attained office seven years ago, it has taken the total debt load from almost $10 billion up to $14 billion. Now this is from a group that pride themselves on being fiscally responsible, being able to, as the member for Inkster (Mr. Lamoureux) says, manage a peanut stand. This record of this government is something quite different. It is a record of bungling. It is a record of mismanagement. In fact, Conservative governments across the country historically have had atrocious records on fiscal responsibility. One only has to look at the Mulroney years. One only has to look at the Devine years in Saskatchewan. Conservative governments have atrocious records of fiscal responsibility. Yet they talk the talk, but they do not walk the walk, and that is the history.

It is our job, our job in opposition, to communicate that fact to the voters, because what this government is doing very cynically is responding to the current flavour of the month, the current polls which say that it is now popular to bring in balanced budget legislation. It is the thing to do. It is the thing to do at the moment to confuse the public and to try to make the public forget about their sorry record over the last seven years.

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I know what some of the members opposite think about debt, but how they have been able to sit in a caucus, how they have been able to sit in a caucus for seven years and pile up year after year after year massive debts. In fact, one of the largest debts in Manitoba history was brought in by their previous Finance minister. In fact, the former member for Rossmere virtually resigned over the whole issue because he could not reason with people in his caucus.

So, Madam Speaker, this is very much a public relations exercise on the part of this government. It is incumbent upon the opposition to remind people out there of their record, of their record for the last seven years, and the fact that at any time they could have brought in the legislation that they talk about. In fact, they did not have to bring in legislation at any time. They do not have to bring in legislation now. They simply can do what they promised to do and that is run a surplus budget and be fiscally responsible in government and that is not something we have seen here.

Now, this government has had choices. This government has had basic choices to make as to what to do with its money, and it has made some choices that I think even the member for Lakeside (Mr. Enns), and I know he would question this, because the member for Lakeside I believe agrees with the Federation of Independent Business and others who say that governments should not be throwing tax money at profitable businesses. Okay?

Now, what has this government done, Madam Speaker, in the last seven years? It has given money to a whole range. This gets into the whole question that the member for Inkster (Mr. Lamoureux) is interested in hearing about, and that is the differentiation between good debt and bad debt.

You know, I have often said that I feel that good debt is debt that we put into hydro projects, the floodway, other useful building projects that have a beneficial effect to the people of the province.

Yet there is another classification of debt that I find very hard to tolerate, and that is that whole area of doling out money essentially to pay off campaign supporters and keep them happy, to businesses who do not need it.

I mean, tell me, why would Labatt's Breweries need $55,000 of taxpayers' money? Why? Why would Pizza Hut need $22,000? Are they not responsible enough to know that the province is in a deficit and there are other people in this province in need of help much more so than they? Tell me, why would McDonald's Restaurants need $68,000? Why would Molson's need $23,000? Why would Taco Bell need $8,000 in taxpayers' help? Why would Wendy's Restaurants, A & W foods? Why do these companies need tax money? Does the government not understand that by giving them tax money, it is borrowed money? That is the borrowed money they love to talk about. Mortgaging the future, they say.

When we were in government, they constantly talked about how it was that we were putting our grandchildren in hock, the ball and chain, the bankers, the gnomes from Zurich were going to foreclose on us and this accumulating debt was going to be a ball and chain on our grandchildren, that we would never pay it off.

They took government, and what have they done? They have compounded the problem. They have compounded the problem by increasing the total debt by a third.

Now, Madam Speaker, we do believe that there is a role for government borrowing. Like I said, we do believe that when the province is building hydro projects, that is necessary borrowing. That is good debt. We have likened the situation to a family situation where we have to try to balance our family budgets but we do not go out and sell the car when we are a few dollars short. That is what is going to happen with this legislation, you see. What is going to happen is, in years when the government is short of money, they will simply sell off a Crown corporation at fire-sale prices. That is like going around a Monopoly board, landing on the gas company where the rent is $4 and having to take off one of your hotels at half price to continue in the game.

That is one of the things we are concerned about, that if the government straitjackets itself to the point that it has to sell off assets at fire-sale prices just to meet the targets in the budget, then we say that that is not very prudent in fiscal management. If the government insists upon doing that, then they will have a shorter lifetime as a government than they might otherwise have.

I just find it absolutely unbelievable that they could be so self-righteous in their approach to this particular problem, that they could in fact bring in this legislation at this time and in fact use it in the election and win a bigger majority by appearing to be fiscally responsible when the figures show that that is certainly not the truth.

In fact, Madam Speaker, the general purpose debt in the last seven years increased from $5.2 billion to $6.9 billion. That is a $1.7-billion increase in the general-purpose debt in their period of time. As I said, the government had choices. It had a number of choices.

They will argue that the debt is an international problem. It is true that in the '50s and so on people from all persuasions acted in much the same way. In the '50s and '60s, people, whether it was an NDP government or CCF government in Saskatchewan, whether it was a Social Credit government, whether it was Conservative, Liberal governments, in those days people were not comfortable with debt. They did not have credit cards. They were not comfortable taking out long-term mortagages. They tended to pay their bills as they went along, and that was the attitude in those days.

Over the years, with the availability of credit and the seductive advertising programs that are in place with the financial institutions and other people selling consumer goods to lure people into debt, people have managed to convince themselves over a generation that it is all right to do that. The result is that we are seeing the downside of getting into hock.

What has happened is that politicians are being no different from people in the general public. Whether they be Conservative politicians, NDP or Liberal, politicians today are comfortable taking out mortgages at 60 years of age. They are comfortable buying cars on credit. They are comfortable buying cottages. So what we have done is, we have basically extended ourselves to the point where each and every one of us is carrying around a ball and chain that we were not carrying around in the '50s.

Now we have come to the wall. We have finally come to the wall and now we have to scramble and find out how we are collectively to deal with the problem. I say and we say here that we have to recognize the problem, and that is something that I think all parties have had trouble recognizing.

The Tories talk about it. They claim they recognize it but, clearly, their seven-year history shows they have not done anything about it. Now we are being forced to recognize the problem. The question is, how do we deal with it? Of course, the Conservatives way of dealing with it will not be the same as ours. We will not be giving McDonald's Restaurants $68,000. We will not be giving car dealers grants to train used car salespeople. These are profitable corporations. They should take care of their own training and pay for it themselves. The taxpayers of this province should not be paying for that. So we will save money by not doing things like that, but we will not cut entitlements to people who are most in need.

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The Conservatives are really running headlong here to catch up. They feel they have been outflanked by Harris in the East and Klein in the West. When you think of the new rights' approach to things, it is basically welfare benefits are a problem, so says Mr. Harris, and the answer is just chop it by 20 percent. Meanwhile, those same private companies that paid for the Conservative election campaign in Ontario will still be getting their benefits. On top of that, they are demanding and they will get tax cuts which is another basic tenet of the new right.

So this government, having reached the wall, having hit the wall, is now in the process of trying to decide, how are we going to bring things back into line; how are we going to take that $14 billion and pay it off? That is the total debt, the $14 billion. It is $7 billion as far as the general purpose debt is concerned. How are we going to do that and, more importantly, who is going to do this? What we are going to see under this legislation when it is passed is that this government is going to successively over a period of years use this legislation and use this debt crisis to further--

Mr. Lamoureux: Justify cuts.

Mr. Maloway: Justify cuts, as the member for Inkster (Mr. Lamoureux) says, but also further that agenda of getting the government out of various activities.

So what we will see is a privatization of government housing programs and a whole range, because they have sold off a few corporations as it is, and they will be sold off to people at fire sale prices. When I say friends, I mean that very generically. I do not mean that there is a personal friend of the Premier (Mr. Filmon) or the personal friend of the member for Lakeside (Mr. Enns) is getting this or that. I am saying there are supporters of the philosophy of the government, and they are being given public assets that taxpayers have paid for, and, in fact, borrowed money has paid for in a lot of cases, and they are being sold at a fraction of their value in many cases to outside interests.

So what you are going to see as a result of this is a race to the bottom. You are going to see a selling off of public assets. We are seeing right now the federal Liberal government--and I know we are talking about a provincial bill--but the federal Liberals are trying to sell off the railway. What are they doing? To save money or to stop the bleed of money, they are taking an additional billion dollars of taxpayers' money, paying down the debt, basically fattening up the cow for sale because the private entrepreneur does not want to take it if it is losing money. So you pay more tax money to fatten it up, and then hand it off to these business people who in fact turn around and break it up and sell it off.

So if you want to get back to the law of the jungle--and that is what these people want. That is what these people are comfortable with is the law of the jungle, but certainly one of the biggest hypocrisies of business people and particularly Conservatives that I have seen is that they do not believe in the talk. The first time they have to deal in a free enterprise environment they come crying to the government. I mean, good God. It is constant. These free enterprisers, riding tall in the saddle across the prairie ready to take on the world, want the government to stay out of their affairs; they do not want to pay taxes and so on. Yet they are the first ones who are crying about grants for business.

Well, tell me, where is the free enterprise? Where is it? The Conservatives are not free enterprisers. I do not see any over there. They are not free enterprisers because at the end of the day what they believe is basically a hijacking of the system to benefit a few. Their ideology grabs the system and doles out the goodies, the tax deductions and the grants to their few. That is how this system works.

Now they are going to use this legislation to attempt to throttle the deficit and convince the public that now it is time to sell off their hard-earned and already paid-for assets at fire-sale prices to take care of a deficit that in fact they have created. To be fair, they have not created the total deficit. As I mentioned, in terms of the entire generation, we had our share of responsibility for that debt as well, and we have to accept that. We did not necessarily make our whole political careers out of talking about the deficit. You did, and I do not see the action there.

Madam Speaker, the bill contains some other interesting provisions to it. One of them has to do with the cabinet ministers' salaries if they do not make their targets, and I think they think that is going to be quite an incentive for the cabinet ministers to get in line and do their job behind this. Only time will tell how many of those cabinet ministers will fall victim to the restrictions that they put on.

Another provision has to do with having referendums for major tax increases. I guess our observation there, Madam Speaker, has to do with the fact that this particular bill will provide for referendum on tax increases, but there are other ways that this government has raised tax. This government has in the past and will continue to offload on other levels of government, on the civic levels of government. It passed through an increase in the property tax credits by removing a piece of it a couple of years ago. Now these are not direct tax increases, but these are tax increases just in another name. They have expanded the PST into areas that it has not been covered. They have had revenue grabs in the past, and they will continue, which will be outside the purview of this legislation that they are talking about.

So you see that this thing was concocted by a favourite group of pollsters somewhere, who have guts and good polling results on this. In the backrooms they have come up with this concoction. They can see that it has produced some results in other jurisdictions, and they are going ahead with it. We will not be fooled by these attempts, and we will point out the negative aspects of this bill.

Madam Speaker, I wanted to deal with a couple of other examples of mismanagement and bungling in this government because this government has prided itself, and I believe columnists have made reference to the fact, that it is has not lost any ministers yet and that it has been relatively scandal free. I will grant it that. They have been a pretty disciplined lot over there on that side of it. [interjection] My colleague says, boring, not exciting. They are not an exciting bunch, and that is fine.

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There are many examples starting to come to light now of government mismanagement and government bungling. I will tell you that one such whole area is the Finance department and their collection or lack of collection of their accounts, that is, other taxes, exactly. Business people out on the street have some respect for and are quite, I should not say, terrified when it comes to Revenue Canada. When Revenue Canada comes a calling, they start writing cheques. The arthritis clears up pretty quick when Revenue Canada calls.

When a Manitoba tax department comes trying to collect its sales tax, the arthritis sets in again, and those cheques do not get written. There does not seem to be the same respect, I guess, for the provincial tax department as there is for Revenue Canada. They seem unable, they seem unwilling in some cases to collect these overdue accounts.

I notice that every year they come out with a list of long overdue accounts that they have been unable to collect. I have asked before and I wonder why they allow them to get to the state they are in. Why does an account get to be $100,000 in arrears? I mean, one would think that if people are awake over there, if the Finance minister was awake, they would be on top of these things as soon as the company starts being delinquent in its filings. We see incident after incident where the numbers get very high before the department gets involved, and clearly what is happening is the businesses are paying other people, but they are not paying the Finance department.

Let me also tell you why this is such a serious issue or more serious than maybe just a normal nonpayment of a bill would be. This money is essentially trust money. This is money that Manitobans have paid, have gone to the restaurant or the bar or wherever they have gone, country club, you name it, and they have paid 7 percent PST. This money belongs to the taxpayers of Manitoba. It is really trust money, and what these businesses are doing is misappropriating. They are taking this money and they are using it for some other purpose. They are using it for some other purpose, or it is outright theft--that is what it is. How else would you explain it?

There has to be some thought put in by the Finance department into a being a little tougher on these overdue accounts, and unless and until that is done, I think the lack of respect or the respect for the Finance department and their collection people is going to deteriorate. I think there is a morale problem there now; I think there has been for several years, but I think it is going to deteriorate. It is going to get worse, and, as people find out that other people are not paying their bills, I think that it is going to mushroom. So, clearly, this government has to get its house in order in that area.

You know, perhaps their Finance minister is finding that he is involved in too many things. I mean, he has been--the Premier (Mr. Filmon), whenever he has a hot potato in his hand, he is smart enough to juggle it over to one or the other people that are prepared to carry the bomb. Currently, the Minister of Finance (Mr. Stefanson) has been carrying a bag full of bombs for the Premier. You know, the Premier wades into the Jets issue, and things get a little hot, so then he throws it over to the Minister of Finance. You know, if it does not go off, fine, the Minister of Finance will survive. If the bomb goes off, well, we can always replace the Minister of Finance. So the Premier is smart enough to do that.

The Minister of Finance, you know, he is running around trying to save the Jets. He is running around with the Lotteries revenue and trying to kind of keep that hidden from the public long enough so he can get it back into the mix just before the election. So, while the Minister of Finance is fiddling away doing his work, his department is not collecting the money. You know, the first myth of Tory fiscal management is that it exists, because it does not. It does not when the chips are down and when you look at it.

Now, Madam Speaker, coupled with the mismanagement--[interjection] Well, in the government's press release that it sent out on this legislation on June 14, it talked about a deficit-free government. That is what the government is talking about, and we are talking about--[interjection] No, they are talking about a deficit-free government and paying off the debt over 30 years. So that is the road that we followed so far. We are talking 30 years. I do not think there will be too many people, other than the member for Brandon East (Mr. Leonard Evans) and the member for Lakeside (Mr. Enns), still here in 30 years to see this burning of the mortgage.

Now, Madam Speaker, I know you are very interested in hearing about the problem that this government has, and I admit this is a problem that all the provincial governments have. I think that part of it is being solved now with the federal government, but the province, when it gets into competition for businesses--[interjection] Yes, it cannot win. The member for Inkster (Mr. Lamoureux) says it cannot win. The member for Lakeside knows this very well too, that businesses know they can go cap in hand from one province to the other, play one province off against another, getting tax breaks and other incentives put in. When you do that, of course, you dilute your revenue base and create more problems down the line.

That problem is partially now solved with the federal government or the provinces getting together and agreeing that they would stop the practice of poaching, where they would go in and basically buy jobs from one area and move them to another. Madam Speaker, it still does not solve the problem of the incentives. It still does not solve the problem with incentives. You still have the bidding wars going on between the provinces to attract these businesses. So all they have managed to resolve at this point in time is the poaching problem, but the other problem is still very much alive. As long as we are in this battle for offering incentives to get businesses to locate here and we are up competing against another jurisdiction that is prepared to give them even more freebies, then that compounds our problem.

So we are going to have a lot of pain, no matter which way. No matter which government is in power over the next decade, it is going to have to deal with a lot of fiscal pain, and the public are going to make their judgments as to how the governments are dealing with that. From our point of view, we will not break the trust that we have with poorer people, with working people in the province. So when we are back in power--and it will happen. When we are back in power, you know, the car dealers of the province will have to rely on their own resources to get their training. McDonalds and other companies will have to have to pay for their own training, and we will still take care of the people who need it most.

Now, Madam Speaker, when I made reference to the selling off of Crown assets and said that that is what this government is going to do over the long haul, it is not a prediction that they are going to start doing this in another year or two. The fact of the matter is, they have already got into it. In 1994, they sold McKenzie Seeds, which was a money-making company, and they ended up putting the proceeds of that sale into general revenues. So there you have it. They have already gone through the exercise on one occasion. They have already gone through the exercise of taking a money-making taxpayer-paid-for-and-owned corporation, and they managed to sell it off and take the money and put it into general revenues. So why would we not think for a moment that this will not be an ongoing strategy of this government? This is only the beginning. [interjection]

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Well, the member for Inkster (Mr. Lamoureaux) wants to talk about the fiscal stabilization fund. When the member for Inkster has his 40 minutes, I am sure he will be making his comments about that.

Now, Madam Speaker, there have been some arguments made that in the last number of years we have not had the abilities to invest in different things, and there is a certain amount of truth to that because of the reluctance, I guess, of all governments to get involved in borrowing even more money, but the government, in the interest of the people, will have to, in the future, involve itself in borrowing money whether it likes it or not.

If the time comes when the province has to develop another hydro project, we will have to do it. We will have to pay the costs and we will have to develop the project. What this legislation is in effect telling us is that we may have to forgo some of those opportunities in the future because of the perceived debt problem right now.

Madam Speaker, I think that my time is just about up, and I thank you very much for your time.

Hon. Harry Enns (Minister of Agriculture): I move to make a few comments on this very important bill that is before the Legislature, and I move to make these comments at this time primarily because of what I know will be the constant refrain from members opposite, particularly the members of the opposition.

Madam Speaker, for disinformation to succeed, and honourable members opposite are practising disinformation, there has to be a kernel of truth to begin with, and they cleverly used that truth, and the speaker for Elmwood just demonstrated that again.

It is, of course, true that a Conservative administration here in this Legislature brought in large deficit budgets. It is, of course, true that the federal Conservative government under Prime Minister Mulroney brought in large deficit budgets, but it is absolutely untrue that Conservative administrations in this province or indeed on the federal scene are responsible for the unmanageable debt that brings about the necessity of this kind of legislation and that is simply true.

You see, the attack obviously is to begin with that bit of disinformation and then to take that one truism that is in their statement and then distort, indeed even falsify and perversely present to the people an entirely erroneous picture.

Let me just refresh honourable members' memory of the huge and unmanageable problem that Canada faces, one that my Liberal friends in Ottawa now find tremendously difficult to cope with and deal with. You hear that in the kind of expressions from that veteran former Liberal cabinet minister Warren Allmand, who was unceremoniously removed from his responsibilities in that caucus but who still honestly wants to espouse the Liberal beliefs.

In '68-69, Madam Speaker, the federal government's budget, current account, was in balance. That is not to say that Canada did not have a debt coming through the war years and the Depression and things like that, but it was a manageable debt. I have no problem, either in private life as a modest farm operator or that business person that deals with credit wisely and responsibly, as long as it is a manageable debt. That was the situation that Canada's finances were in when the Pearson administration left office and Canada was ushered into the era of Trudeaumania.

Since 1970, Canada's current account was in deficit and growing. It really got out of control when he required the support of the New Democrats with Mr. Lewis in those minority years, '73 to '74 or '77, and for a period of time right up until and including the short nine-month Clark administration, but up until 1984, before the federal government could bring its current account into balance.

So it is quite true that the Mulroney government, once Canada had rolled up a hundred-billion-billion dollars of debt, that the carrying charges and the interest rates on those carrying charges kept adding to that horrendous debt; when members opposite attack this kind of legislation and say, well, Conservative governments have brought in large deficit budgets, that is quite true.

But it was Brian Mulroney's government that brought Canada's finance into order in terms of current account. Now, that is not solving Paul Martin's problem today, because the interest clock is ticking. The things that the federal government is now having to do are not being done easily or with any great enthusiasm on their part, but they have to do it because that interest clock is ticking. But to suggest that the Conservatives nationally got us into that financially difficult situation is simply disinformation.

Madam Speaker, here in Manitoba, let me remind all members, the story is not much different. It is still inconceivable to me that one Premier, one administration, one Howard Pawley, of which the present Leader and some members are a part of, managed to borrow more money in five and a half, six short years than all 18 previous administrations since the inception of this province.

Prior to the Pawley administration, our provincial debt sat at about $3.5 billion. [interjection] Well, we are talking manageable debt. In a short six years, Mr. Pawley did not borrow just as much as all other 18 administrations--I remind honourable members that there were some high spenders among those 18 premiers, including the first premier I had the privilege to serve, the Honourable Duff Roblin; Ed Schreyer was a pretty good spender.

We went through two wars, and we went through the Depression, and we established consolidated school districts. We established two additional universities in this province. We introduced medicare. We introduced hospital care, and all of that was accomplished maintaining a manageable debt for the Province of Manitoba of roughly $3 billion.

Six short years later, after Howard Pawley, that one administration, we end up with a debt of over $7 billion or $8 billion, more than twice as much as all other 18.

That, Madam Speaker, is what makes it quite true, it is quite true when the honourable members of the opposition say that Clayton Manness brought in a big deficit budget. Yes, because by the time we came into office in '88 that clock was ticking on those $7 billion to $8 billion of debt, and we wrestled and were criticized for it.

I was in the Department of Natural Resources. The Department of Highways had to give up big chunks of money. The Department of Agriculture, all the working departments, as I like to call them, we tried to safeguard those essential services in Family Services, in Health and Education, but even they are now under some extreme difficulties in part because of the fiscal reality that is being placed on us by our federal partner.

Again, Madam Speaker, the major component of the debt that my colleague, my former colleague, Clayton Manness had to bring in to this House was the 550 millions to 570 millions of dollars of interest on that accumulated debt, of which Duff Roblin, Walter Weir, Ed Schreyer, D.L. Campbell and all the rest of them had precious little to do with. So let me put that on the record.

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Why is it that the opposition opposes this bill to the extent that they oppose it? You have to ask yourself that question, because I will tell you quite frankly there is a great deal about Bill 2 that offends me as a free, elected legislator, a great deal. I would like to think that I am elected in this House to make the kind of decisions that my constituents ask me to make from time to time, but I will explain. I will explain.

We have reached a point in our fiscal management in this country and in this province that, No. 1, the simple statement has to be made, because I am also elected as a Conservative legislator. I simply believe that the level of a taxation, the level that big government takes from our hard-working citizens has reached an absolute plateau. You see, deep down although they do not believe it--and they know, they are legislators and the honourable member says and he may well be correct, and I suspect they will be government some day--but, Madam Speaker, they are also smart enough to realize that in the foreseeable future that we are living in, the fiscal climate will be such that it will be very, very difficult for them to change and alter the course and the principles contained in Bill 2.

I believe it with conviction that taking 50, 60 percent of hard-earned income from the people of Manitoba is too much and it stifles economic growth. It stifles the very things that you prattle about, job security, security for our social services. You will like the idea of having to be competitive in a globalized economy. Well, maybe I do not like it either. It is much more comfortable if you have a nice little backyard economy and not have to worry about what the big Americans are doing or what the Europeans are doing or, Heaven forbid, what the Japanese and the Koreans are doing, but that is not the real world.

If we want to sell our potatoes, if we want to sell our manufacturing produce, if our youngsters want jobs in this province, then we have to be competitive in the global world. Unless you are prepared to accept those truths, then you are just out to lunch. You are just out to lunch, and that means that we cannot saddle our businesses and our economic entrepreneurs with the levels of taxation that are wildly out of step with our major trading partners.

(Mr. Marcel Laurendeau, Deputy Speaker, in the Chair)

The word "harmonization" just shudders the socialist. They do not like the idea of harmonizing, least of all harmonizing with our American friends. They just do not like that at all. Why should we harmonize anything with our American friends? You do not have to like them, you do not have to love them, but if you want to trade with them and if you want the jobs in Canada, then you better be competitive with them.

The one thing governments can do is to recognize, and that is essentially what we recognize in Bill 2. That is why I support Bill 2 strongly, because I believe totally that the levels of taxation, 13 percent, 14 percent, in some provinces 15 and 18 percent on sales taxes--the GST and the provincial sales taxes, they are amounting to 16, 17, 18 percent in some provinces, 14 percent in our province. That is a max level. I am not troubled by saying that I am not going to try and raise those levels.

The levels of income tax are at max levels in my opinion, not that maybe there would not be a consensus among Manitobans or Canadians who would say, well, we value certain services, certainly some of our social services, at a higher level than other populations do in other lands. We might be willing, we might even form some consensus, and of course the bill provides it, although, let us not fool ourselves. I suspect that getting a referendum passed that says we are going to increase the provincial sales tax by two points, or something like that, is going to have pretty rough sledding--or the personal income tax.

Let us assume, Mr. Deputy Speaker, that that consensus was found. Let us assume, under the leadership of the member for Elmwood (Mr. Maloway), sometime in the year 2043, when his party forms government, that consensus is capable and the clauses of this bill are still in effect and he can convince Manitobans that we should raise taxes, I say to him, that still would be a mistake, because it is not good enough simply for us to say that we can, independently of our trading partners, raise levels of taxation that then make it next to impossible for our economic entrepreneurs and our businesses to flourish.

Remember, in a province like Manitoba, and certainly that will be true for the foreseeable future, so much of what we do and so much of the wealth that we generate, that supports us in those programs that are important to us, are totally dependent on our ability to export into all the markets of the world. Whether that is in agri-food products, whether that is in manufacturing products or whether it is some of our specialized endeavours in medicine and in technology, telecommunications technology and so forth, it is of no avail unless we are in a competitive position.

So, Mr. Deputy Speaker, let us understand, when members opposite--and it is picked up by those who fail or simply do not want to acknowledge the seriousness of our financial situation--take exception to this bill and oppose it, let us understand and let us be wary of the deliberate disinformation, that is, that the approach that the opposition takes to this bill is precisely that, disinformation. They take a kernel of truth and then distort it in a very perverse way. To suggest that Clayton Manness was responsible for the $550 million, $560 million of carrying charges is simply not true. For the first time since many of you sat in the Legislature--I had the privilege before of sitting in a Legislature where the current spending of the government was in balance. When Walter Weir left office in 1969, there was a modest $55-million surplus in the current account.

So let us understand that tactic for what it is, and let us strengthen our own resolve to move forward with this legislation. It is the kind of legislation that is benchmark legislation, one that all those who will be given the opportunity to support it, as well as those who have the opportunity no doubt will take it to oppose it, it will be remembered as one of the more significant pieces of legislation in their lifetime in this Chamber. Thank you very much, Mr. Deputy Speaker.

Mr. Leonard Evans (Brandon East): Mr. Deputy Speaker, I wonder if the honourable member would answer a question pertaining to his last speech.

Mr. Deputy Speaker: Is there leave for the honourable member for Brandon East to ask the honourable Minister of Agriculture a question? Leave? Leave has been granted.

Point of Order

Mr. Enns: Mr. Deputy Speaker, on a point of order, it is not a question of leave. If there is time permitting on my speaking time, it is for me to decide whether I will answer the question, not for the House, with all due respect.

Mr. Deputy Speaker: The honourable member for Brandon East, if the minister is willing.

* * *

Mr. Leonard Evans: I thank the minister very much for agreeing to answer a question. I always enjoy listening to him, even though I may not agree with most of what he says.

I would like to ask very simply, Mr. Deputy Speaker, whether this minister believes that his government or indeed any government cannot pay down the provincial debt without this legislation. Do you have to have this legislation to pay down the provincial debt?

Mr. Enns: Mr. Deputy Speaker, I do not believe that this legislation is absolutely necessary to pay down the provincial debt. It is a matter of political will. This legislation expresses the political will of this administration in a very clear and precise manner.

You know, I would like to think that all of us who from time to time are entrusted with the stewardship of serving on Executive Council accept the will of this Chamber very seriously, and of course they better, because it is law, and that is what this bill does. But to answer the member from Brandon's question, no, it certainly can be done by discipline and political will. The bill in itself is not necessary to achieve that objective.

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Ms. Marianne Cerilli (Radisson): Mr. Deputy Speaker, I am pleased to rise and join the debate on Bill 2, the so-called balanced budget legislation. I have spent some time reading a variety of articles and publications that are dealing with the proposals in this legislation, and I have come to view it as one of the most dangerous pieces of legislation we have had to deal with, particularly in my tenure here in the Legislature.

I think that this piece of legislation is much like the Free Trade Agreement. It has the same agenda, and it is equally as dangerous for our province as both the free trade agreements have been for Canada and Manitoba. It sounds appealing at first to talk about balancing the budget. I think all of us would want to strive for that to make sure that we are not spending more than we are bringing in, that we are not spending more than we are bringing in to meet the needs of Manitobans. But I would suggest that this legislation is not balanced in its support. I would suggest too that this government is not balanced, but that is a different issue.

It sounds appealing, but when you look at the fine print, when you look at what this legislation is doing, it really is a straitjacket. I think it is really a political gimmick. I think that this government has latched on to this legislation as a gimmick that is something they can wave around both pre-election and now. But I think it is going to come back to haunt them. One of the things that is a gimmick about it is, I think, it will give this government something to blame when they want to continue slashing programs and funding and charging user fees and continuing to make our taxation system more and more regressive and unfair.

I think that is part of what the gimmickry of this is, as this government has done on so many more occasions when they blame school division boards, when they blame municipalities, when they blame agencies that they create who then have to cut services because they have cut the funding to those bodies. They are going to use this piece of legislation saying, it is not us, it is the law. We have to do all of these things.

I think that they will do all of these things because of this legislation. They will be forced to cut programs and funding, charge user fees and service fees, and create a more unfair tax system. Those things are built into this legislation.

But, like the Free Trade Agreement, this legislation takes away the ability of democratically elected governments to act on behalf of citizens, to respond to needs in the community and to plan investments for our province and to have a role in planning and directing the economy. Those of us on this side of the House believe that government should function in that way. We believe in an activist government that has a role in being involved in the economy. Those on the other hand, I would suggest, want to have this legislation because they want to reduce government's role in our community, in society, in the economy. They want to reduce the size of government, and this is just the kind of tactic that they need to do this, legislation that forces them to do that very thing.

One of the other things that is so amazing about this legislation is where it is coming from, where the push for this kind of legislation is coming from. It is coming from the far right in the country. I would say the far right in the country is represented by the Manitoba Taxpayers Association. I have read their most recent publication, their issue of their newspaper that we all receive in our mailboxes. I can guess where they get the financing to put out this kind of propaganda. When you read what they are saying about this bill--they give a lot of accolades to the bill--you have to really question the thinking. These are the same people who just had an article in the Free Press, a letter to the editor in the Free Press that said that poverty in Manitoba is being caused in part by high taxes, rigid labour markets, whatever that means, and the public education system.

I want to see if this government agrees with that since these are the people who are supporting this and are pushing the government to bring in this kind of legislation, if they agree with their analysis on what is causing poverty in this province and in this country, that it is our public education system. This is the same government that has just increased funding for private schools by a hundred dollars per child at the same time they are cutting and freezing the funding for public schools. So it makes us think that they do agree with this analysis on why we have poverty. The Minister of Agriculture (Mr. Enns) has just agreed that he thinks that taxation is contributing to poverty in this province, and that is the kind of analysis they are dealing with.

What I find really ironic, though, is that the same author for this letter to the editor was the same person who was an adviser to Mr. Grant Devine, the former Premier of Saskatchewan, who has to be one of the deficit and debt kings of this country. How can we believe this government? They do not and have not shown that they can walk the walk when they talk about balanced budgets. This government has no record on managing the finances of this province responsibly year after year--until now--of racking up some of the biggest deficit budgets.

In '92-93, Premier Filmon and his cabinet broke the record in Manitoba by ringing up a $742-million deficit that year, and we are supposed to believe that they can responsibly manage the finance with this legislation. I do not think so. I do not think that is the case. The same time this is the government that has irresponsibly cut programs for education like the Access program which proved to save money in the long run because it got disadvantaged Manitobans off the welfare rolls through education programs and into the job market at an unprecedented success rate like no other education program for those populations ever before in this province. It was New Democrat governments that brought in those programs that proved to be so successful, and that show that education is an investment and can prove to be a very good cost-effective investment.

Mr. Deputy Speaker, in keeping with the idea that this government has not shown itself to be responsible fiscal managers, we just have to look at the Jets fiasco. Where was their concern about cost when they were willing to sign an operating agreement to finance the operating losses of the Winnipeg Jets? Where was their big concern for Manitobans' pocketbooks? What are we at now in terms of the millions of dollars? It is somewhere at least $40 million that we have covered in tax dollars of a professional hockey team that pays its hockey players over $2 million a year in some cases. Where was their big concern then? It was very political decision making, and it is the same thing with this legislation, the same thing when during the effort to save face after the election on the Jets' broken promises that they were willing to dig us deeper into the Jets' hole by agreeing to spend $5 million to buy the team. These are examples that show this government has not been responsible in dealing with the public finances of the Province of Manitoba.

Then, also, just before the election, when they tried to cook the books and bring in their pre-election budget, they had no balanced budget. We had agency after agency, including the Provincial Auditor, say that it was really a $98-million deficit in that pre-election budget, and now we are expected to believe then that this legislation is going to be the panacea. Maybe this is the legislation that this government needs, that they will take a slash-and-burn approach, because they have not been able to do a responsible job without it. As the question just asked by the member for Brandon East (Mr. Leonard Evans) has proven, it is a gimmick, because the government should not have to have legislation to balance the books in Manitoba, so we have to ask ourselves why is this government doing this? It is a political gimmick.

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It is a political gimmick just like it was a gimmick when they inherited in '88-89 the surplus of $58 million. Rather than applying that money to the debt, they created the Fiscal Stabilization Fund, and they put the money in the Fiscal Stabilization Fund so that they could again save face and not have to show that indeed the NDP had gone a long way, it had gone through that curve in the economy, had weathered the recession and now was able to bring in a surplus budget.

With this legislation the government is giving up on being able to balance its revenue with the needs of the community. We are no longer going to have the government able to invest into the province of Manitoba. One of the most dangerous things about the legislation is the way that it links operating and capital borrowing and investment, and this is one of the things that is the most disconcerting.

I want to quote from Premier Duff Roblin, celebrating the--

An Honourable Member: Some of the Premiers become popular about 40 years after.

Ms. Cerilli: Yes, it is amazing--these red Tories. He said he realized that if Manitoba was going to grow, it would have to borrow. Roblin once asked: Who can say what the monetary cost is of not building a road, a school or a hospital? That is the quote, and, of course, the legacy of Mr. Roblin around Winnipeg is the floodway, or some refer to it as Duff's ditch.

This is the kind of long-term vision and investment we have had in this province from a provincial government interested in co-operating with the City of Winnipeg and municipalities to create something that is going to be in the long run an advantage.

The same kind of vision and approach is needed now when we want to address the problem of the combined sewer system for parts of Winnipeg. We need the same kind of vision, but with this legislation we would not be able to borrow the money to have the long-term investment so we are no longer polluting the Red River by dumping raw sewage in there when we have heavy rains and flooding in the city of Winnipeg.

Similarly, we cannot have the borrowing to deal with the problems with the aqueduct in the city of Winnipeg, which is in dire need of repair, and we will not have the long-term planning to provide that kind of investment into the things that benefit all of our community. I would say that is one of the things that the government has a role in, to provide that kind of infrastructure that is going to meet the needs of the public in the province.

Now, all of this kind of borrowing will have to be done within a balanced-budget year, so this legislation requires not a cyclical allowance for fluctuations in the economy but the requirement that the budget will have to be balanced each year.

None of us in our families, unless you are independently wealthy, functions this way. Businesses that start do not function this way. How many of us have not had to borrow to buy a house or buy a car or go to university? Most of us, certainly most of the people that I represent in the constituency of Radisson, are of the means that we have to incur a debt to have all of those things. I do not think it is an option for any of us to live on the street while we are saving money to pay cash for a home. That does not make any sense, just like it does not even make financial sense to rent for the period of time to save enough money to pay cash for a home. We take out a mortgage. It actually is better financially to take out a mortgage in our economy. It does not make sense to continue to rent until you can have the full amount to pay for a home.

So we have to realize that this government is not dealing in reality when they are trying to say that we should be balancing, especially on the capital investment side of the province, but it is a gimmick, as I have said, by governments that really do not believe in governments in the first place. It is another justification for them to privatize public services, just like they did with McKenzie Seeds.

Now, they have taken criticism from the Provincial Auditor, the Dominion Bond Rating agency, the Canada West Foundation, for this approach which again was a pre-election budget gimmick to sell off McKenzie Seeds--and I think they did it with a couple of other Crown corporations, the Manitoba Development Corporation--and to keep that money aside and then count the revenue a year or so later in the pre-election budget. Now we can I think be sure that this government has the same plans for, first on their list, the Manitoba Telephone System, the Manitoba Public Insurance Corporation, Manitoba Hydro.

We have had the mayor of the City of Winnipeg recommend this for Winnipeg Hydro. I think she is of the same political ilk as the members opposite, and they do not seem to understand that our Crown corporations are of value to the entire community. We own that. We own them, and they are a tremendous investment, and over the long term if those are privatized we will lose billions of dollars. These assets are worth far more to the community functioning and operating than they ever would be as a budget line one year in a balanced budget for the province of Manitoba. It is exactly what we see happening with this privatization of CN. We are not going to get nearly what that is worth to our community, especially since they are having us pay off some of that debt before they even privatize it.

One of the most deceptive gimmicks of this bill, though, is in the provision for referendum requirements. It sounds good for people to have a vote on their major tax increases, but the loopholes in this referendum provision are quite large. It would allow the continued hidden or obfuscated tax increases that this government has been undertaking. For example, in 1993 when they increased the property tax credit, the tax grab that they took where it meant a $75 reduction for Manitobans, when they broadened the scope of the provincial sales tax to items that some people think should not have a sales tax on them--sales tax has been one of the most regressive forms of taxation--and also when they increased the fuel tax, all of these things broadening the scope of the provincial sales tax--continuing to reduce property tax credits for families--and these things, all of them, are exempt from having a referendum.

In 1993, the combination of all of these tax increases by the provincial Conservative government amounted to about $400 for a family of four in Manitoba. So what this government is doing is stacking the debt against having more fair taxation in our province, because the other thing that they are allowing with this provision in the legislation is that as long as the total revenue in the tax system of Manitoba does not increase they can continue to change our taxes and from collecting taxation for businesses and corporations and passing it off onto citizens and families, which is what I would say is causing or contributing to some of the problems we are having where individual families have taken more than their fair share of the tax burden, and we have had governments, Conservative and Liberal governments, give more and more tax breaks to wealthy corporations and individuals.

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So that kind of tax policy is to some extent made law by this bill because you do not have to have a referendum. People are not allowed to vote when you are going to increase their taxes that way. I find that quite disturbing, and it is going to be a big problem for this province.

Mr. Deputy Speaker: Order, please. The hour being 4 p.m., as previously agreed it is now time for private members' hour. When this matter is again before the House, the honourable member for Radisson (Ms. Cerilli) will have 20 minutes. As previously agreed, this matter will remain standing in the name of the honourable member for Wellington (Ms. Barrett).