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The Acting Chairperson (Mr. Helwer): Will the Committee of Supply please come to order. This section of the Committee of Supply will be dealing with the Estimates of the Department of Consumer and Corporate Affairs. Would the minister's staff please enter the Chamber.

Okay. We are on Resolution 5.1. Administration and Finance (b) Executive Support (1) Salaries and Employee Benefits.

Mr. Steve Ashton (Thompson): Mr. Chairperson, I would like to thank the Acting Minister of Consumer Affairs (Mr. Pitura) for filling in. I am also the acting critic so this will be very interesting. Fortunately we have staff that are not acting staff; they are the real thing and we look forward to raising some questions. I thank the minister for filling in at the last minute on this basis. Primarily, we have questions on the rental side, and I appreciate the minister is an acting minister, but we are certainly expecting that the expertise of the staff will certainly move his knowledge of this area which I am sure is pretty significant anyway. I know he has probably studied Consumer and Corporate Affairs quite diligently, and I think you could say he does know something about consuming, but anyway I certainly appreciate his willingness to fill in.

I want to start because it is an area that I often do get calls on, in my own constituency, and I know some people in our caucus will be raising other concerns down the line, and what I wanted to ask initially is what the current experience is in terms of complaints, either from renters or landlords, in terms of what the caseload is, and I would like to get some sense of the last five years or so. In my own constituency, I am getting more calls than I have for quite some time. I do not know if there is any trend that is indicative of that, but if the minister with his staff present could give some indication of the kind of caseload that we are dealing with it would greatly appreciated.

Hon. Frank Pitura (Acting Minister of Consumer and Corporate Affairs): Mr. Chairman, I welcome the opportunity to sit in, in an acting role, in Consumer and Corporate Affairs and I really hope to get well educated today in the aspects of residential tenancies. I was just wondering if it would be acceptable with the critic if some of the answers to the questions that he is posing could be answered directly by either the deputy Minister, Alexis Morton, or the director, Roger Barsy?

Mr. Ashton: I hate to sound unco-operative but I think it would be better through the minister. But I would suggest if the minister wants to take items under notice that is agreeable. We certainly understand the situation he is in currently. I know some sections of the committee have done this but the role of Estimates really is not for the staff to be speaking directly and I do not think they want to be in that position a lot of times. So, if there are occasions where it is better taken as notice for the actual minister and in some cases, for example, with this kind of question if that information is not readily available, or detailed information is not available but some general information is available, I am quite prepared to accept it on a written basis.

It could be tabled the next meeting of this committee, and I think there will be at least one more set of meetings with Consumer and Corporate Affairs. So, with apologies to the minister, I suggest we deal with that, but we are more than open in terms of, if the minister takes items as notice, because that may be appropriate with a lot of these questions and we appreciate that.

Mr. Pitura: I am advised that within the terms of the Winnipeg workload that under Parts 1 to 8, which is the basic tenancy disputes and this includes the informal mediations, and Part 9, which is under the rent regulation, the number in 1995 was 6,973 and the number in 1998 was 8,462, for an increase of 21.4 percent over four years. I would also inform the member that these are not the statistics that are gleaned from the annual report.

Mr. Doug Martindale (Burrows): The staff will be aware that The Residential Tenancies Act allows for the branch to take over a building, collect the rent, use the rent for repairs and return the building to the owner. I would like to ask the minister if this provision of the act has ever been used, and if so, how often.

Mr. Pitura: Again, I am advised that there has only been once in the history under residential tenancies that the receivership aspect of the regulation has been used, and I am advised that that was used in 1994 in the city of Thompson.

Mr. Martindale: I would like to ask the minister why this provision of the act has not been used more often. As the staff will know, frequently it is the same landlords who generate complaints from renters and from MLAs. In my constituency, for example, it is always the same apartment building, and I try to go and visit that apartment building and go door to door every year in January or February when it is very cold to make sure that the tenants have enough heat because in the past there have been problems where people have been heating their suite by opening the oven door, for example. I do not know why it is–I have some suspicions–that we have to continually phone the Residential Tenancies Branch on behalf of tenants and initiate complaints and fax over requests for repair orders for the same bad actor repeatedly.

Now to the credit of the branch, they actually did do a proactive inspection of this building but probably because of previous complaints or even current complaints. In many cases there are tenants who do not complain, who do not know their rights, and I suspect that the regulations of the act are not always being followed. So just to summarize or recapitulate my question, why is this provision of the act not used more often?

Mr. Pitura: Mr. Chairman, in response to the honourable member's question with regards to why receiver-managers have not been appointed more often, I would just refer to The Residential Tenancies Act under which the section to appoint a receiver-manager is: "A local authority or a majority of the tenants of a residential complex may, in writing, request a director to apply to the court for the appointment of a receiver-manager of the residential complex if

With that section of the act, it would be the responsibility of the tenants as a group to petition the director, in terms of the contravention of the obligation to repair, to appoint a receiver-manager. Secondly, it would have to be an order of the Department of Health, which would have to be exercised and not complied with in order to bring in and appoint a receiver-manager. So it is a fairly complex process that brings about the appointment of a receiver-manager by the director.

Mr. Conrad Santos (Broadway): May I ask what is the legal ceiling limit in terms of a person thinking about rent increases this year, this fiscal year?

Mr. Pitura: I was just wondering if the member would clarify his question somewhat specifically.

Mr. Santos: By what percentage can a landlord of a housing complex increase the rent?

Mr. Pitura: Mr. Chairperson, to the honourable member, the annual rent guideline increases over the past number of years have been limited to 1 percent. I am advised that for 1999, the rent increase is limited to 1 percent.

Mr. Santos: Are there any exceptions to that rule?

Mr. Pitura: Mr. Chairperson, in response to the honourable member's question, I will attempt to give him as thorough an answer as possible. Under the rental increase guidelines, I guess you would call it, the landlord can apply for an exemption from these guidelines based on what the landlord would feel would be extraordinary costs that cannot be covered by the rental increase, but the landlord must make application to the Residential Tenancies Branch for approval. If approved, at that point the tenants who are living in that complex are advised and asked to respond. Indeed, they also have the right to object. If that process takes place, then I believe it comes back to the Residential Tenancies Branch director to make the final order with respect to any increase.

I am also advised that apartments $970 a month and over, that there are no rental guidelines in place with regard to rent increases. However, even under that scenario, tenants can object to the increase that the landlord is placing on rents. Again, it would come to the Residential Tenancies Branch to arbitrate and to end up with an order.

There are also two other exemptions that I would share with the member. One is that the newly constructed rental accommodations are exempt from rental guidelines for five years, and also reconstructed rental units, often described as rehabs, are allowed to have a five-year exemption. In order for rehabs to take place, the landlords have to make application to the Residential Tenancies Branch with respect to the types and kinds of renovations that are going to take place within the apartment complex before they are granted an exemption by the branch for their rental complex.

I would just add to that that in some cases, if it is just a cosmetic type of renovations to the rental units, it would probably be seen as a nonexemption type of environment, as opposed to some major renovations such as walls and floors, plumbing, et cetera. That would be seen as a major rehab or reconstruction of the area, and then in that case there would be a five-year exemption granted.

Mr. Santos: In terms of time horizons, at what point in time will a landlord make the application for exemption in the case of some kind of renovation that you call rehab?

Mr. Pitura: To clarify for the member, because I was wrong in the one aspect of the rental guidelines for the member, that applies to the rental units that are in excess of $970 per month. I am advised that the rental guidelines, in fact the section in regard to that, does not apply to those units in excess of $970 per month. So it is wide open. In other words, there is no regulation, so to speak, that regulates the top end of the rental units.

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Now to the specifics of the member's question that a landlord to apply for an exemption status with respect to the rental guidelines, if there are major renovations being completed or being worked on, 20 percent or less of the project has to be completed and that application by the landlord has to be made before they approach that 20 percent level to qualify for the branch to grant them approval for the exemption. So the project has to be in its infancy stages and the landlord would be making application.

I think the logic of it would be if I was a landlord looking at a major renovation on a rental unit that I would be very wise I think to apply prior to my doing renovations with regard to getting the exemption and not wait to be partially done the project because I might be exposing, at least the kind of work that I might be doing, may not in fact qualify me for a five-year exemption. So therefore I think it would be probably in the landlord's best interests to make these applications early before the project work is started.

Mr. Santos: The term "less that 20 percent of the cost of the project renovation" means that as soon as you have 1 percent or less, that is still less than 20 percent and a landlord can apply for exemption already?

Mr. Pitura: Yes, he can apply, but that simply starts him going through the approval process by the branch to gain that exemption when the project is completed.

Mr. Santos: Is the landlord obligated to notify all the tenants as soon as he files his application for exemption?

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Mr. Pitura: Yes, the tenants have to be notified prior to the project beginning, and they also have to be advised. I guess the details of the project renovation have to be shared with the tenants as well.

Mr. Santos: What does it mean, Mr. Minister, "to be shared with the tenants as well"? The tenants will have to put in the proportionate share of their own renovation?

Mr. Pitura: Just to clarify for the honourable member that when the landlord is intending on doing major renovation work to rental units, first, prior to 20 percent of the work being completed, the application must be made to the Residential Tenancies Branch. That is simply part of the regulatory process that must be followed, but the landlord prior to that would, in terms of the major renovation work, be obligated to share that information with the tenants that are in that rental unit because obviously the work that is going to be done is going to have an effect on their living accommodation. So therefore that advice has to be given to them prior to this major renovation work being completed.

They are not obligated to pay anything towards the renovation project, but the landlord must advise them that, as a result, for example–and I will maybe be corrected on this, but if I was a landlord who was subject to the residential guidelines right now, that because of the major renovation work that I was doing I was going to have an exemption from the rental guidelines, and the renovations that I am going to have done within the rental units is going to result in a substantial increase in the rent in order to cover the new capital cost, amortized capital cost of the units, therefore I would have to advise the tenants that this was going to take place.

Now the tenants, if they have to be displaced as a result of the major renovation taking place, the landlord has to cover their moving costs up to $350 for them if they have to live outside of their rental unit for the period of time that it is being renovated. When the major renovation work is completed, the tenants who are within that rental unit have the first right of refusal with regard to their rental accommodation within that unit. If they decide that for one reason or another they would not wish to live there any longer, then they can refuse that offer for the unit, but they do have that first right to come back in and live in that rental unit in a newly renovated rehab, as they are called.

Mr. Santos: In general, the normal duration of the lease agreement or the rental agreement is one year, and under the law either the tenant or the landlord has to notify the other of any kind of intention to renew or to move out. What is the requirement now?

Mr. Pitura: Within this rental unit, this rehab unit, prior to the major renovations taking place, there are fixed-term agreements in place, which is the one-year lease that the member was referring to, that the landlord must provide notice at least three months prior to the expiry of the agreement that it is the landlord's intention not to renew the tenancy agreement with the tenant as a result of the major renovations taking place. The landlord also has to be sure within the auspices of the act to ensure minimum disruption to the tenants.

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Mr. Santos: So three months prior to the expiration of the existing annual rental agreement, the landlord will notify the tenant that the landlord is not going to renew the agreement. What about if there is a phrase in the rental agreement about the right to renewal, is there such a phrase in the rental agreement itself that it can be renewed at the option of the tenant?

Mr. Pitura: I am advised that under the lease agreement, under The Residential Tenancies Act, the tenant has an automatic right to renew the lease. So, if nothing happens and the tenant is living in this rental accommodation, at the end of the 12-month period, the lease is automatically renewed to go on to another year. Now the exception to this is, of course, with respect to what we have been talking about with the rehabs. In that case, the landlord has to provide the three months notice to the tenant giving them the notice that the landlord intends to not renew the tenancy agreement. The specific reasons are outlined in The Residential Tenancies Act as to what kinds of specific reasons are outlined in the act that the landlord can use as a reason for termination.

Mr. Santos: So there is an automatic right of renewal built into the contract of the rental agreement. But then there will be circumstances or situations which give the landlord the right to break the lease by not renewing or negating this automatic renewal. What are those circumstances at the moment?

Mr. Pitura: In response to the honourable member's question, the specific reasons that a landlord can terminate a lease agreement or the fixed-term agreement are one that we have been discussing, which is a major renovation taking place to the rental unit. Another reason is when the landlord themselves want to move into that particular rental unit, or a member of the landlord's immediate family. That is another condition under which termination notice can come forward, three months prior to the renewing. In the case of rental units that are houses, where the property is sold and the purchaser of the property purchases the dwelling on the basis of occupying a dwelling themselves as a family, in that particular case there is a right to terminate the rental agreement under that situation. If the rental property is converted to another use, I am advised that under that last one there are probably very few and far between in terms of the properties that would be converted to another use with respect to the termination.

Mr. Santos: Obviously all these rules are very complex for ordinary tenants to understand. Let us go back to the more basic question. What are the basic statutory laws passed by the province that govern landlord and tenant agreements? Can we have a review of all these basic statutory laws passed by this Legislature? Let us review them.

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Mr. Pitura: Mr. Chairman, I am advised that the statutory legislation that covers rental property is The Residential Tenancies Act, and that is the only statute that we have in place.

Mr. Santos: Under The Residential Tenancies Act, there are rules and regulations promulgated by the government, right? Who promulgated these rules and regulations? Who wrote them as rules or norms that would be followed in the interpretation of the statute?

Mr. Pitura: Mr. Chairperson, in response to the honourable member's question with respect to the statute and the act with regard to The Residential Tenancies Act, the act was passed in 1992. Of course, in order for an act in this Legislature–one of the things that this government has done is brought in a review process by which legislation, proposed legislation that is deemed to be necessary legislation by any department of government, comes forward for review by a legislative review committee. This is a committee of the government which includes cabinet and caucus members. These members look at the legislation with regard to the way the legislation is being drafted and what it intends to accomplish with the legislation.

Secondly, once the legislation goes through that process, and, of course, it goes through this House and becomes proclaimed or assented to, the drafting of regulations take place in order for the legislation to be enacted, and the regulations go through a similar review process with a committee of cabinet. Once those regulations are approved by that committee and subsequently approved by cabinet, then the legislation can be proclaimed and have the regulations attached to it.

Now, this process I think is one of the major steps I think we in this government have taken with regard to trying to refine the legislative process and the regulation process to try to ensure to the public that they are not going to be overburdened by unnecessary regulations.

So regulations are always scrutinized very closely by that committee, and members of the department who appear to that committee with regulations have to be able to justify that they have had adequate consultation with the people who are going to be affected by the regulations. That is a very vital part of this process that we insist upon that consultation takes place with those that are going to be affected. Once that feedback is taken into account and any adjustments made to the regulations in that regard, we also ask the departments to commit to a sunset clause, a review mechanism by which the regulation will be reviewed within a certain period of time. Then they have to bring it back to the committee as a part of that review process so that the regulation does not get left on the books and unattended to for an undue length of period of time, because we found out when our government came into office in this province that many of the regulations that we started to take a look at in the mid-'90s as part of the regulatory review process, that many of the regulations were old and outdated and totally unnecessary, but they were still there on the books and still active, along with the legislation.

We are now in the process of trying to take a look at all the legislation and all the regulations that are there in an attempt to try to ensure that legislation that is active and alive is still being used, and if any legislation is repealed that it gets totally repealed and off the books and the same thing with the regulations.

So I know it is a long answer for the member, but I just wanted to share with him the kind of process that we go through with regard to legislation, the development of legislation and regulation by the province, and to try to ensure that the regulations that are being brought forward by the department, in this case residential tenancies, is a regulation that is not overly cumbersome and unmanageable by the public who are going to be affected by it.

Mr. Santos: Are the members of the House entitled to an up-to-date copy of those rules and regulations approved by committee of cabinet and by cabinet, so they can be at least abreast as to the changes that are taking place in these rules and regulations?

Mr. Pitura: Yes, the regulation development process, once the regulation is approved by cabinet, it becomes a public document, and at that point in time, any member of the public can obtain a copy of the regulations and a copy of the legislation. That is all available through the Queen's Printer and, in fact, I am also advised with respect to, for example, The Residential Tenancies Act, where you have a landlord tenant relationship, that the Residential Tenancies Branch have put together, for the benefit of both the tenant and the landlord, a policy guideline book which interprets the regulations and the legislation so that people who are living in that rental accommodation have a clearer understanding of how the legislation will affect them and what are their rights and privileges under that legislation.

Mr. Santos: Obviously The Residential Tenancies Act is written in broad outlines, broad provisions, but the specific meaning of the act can only be understood in terms of the specific rules and regulations prescribed by the agency to implement the act. These rules and regulations change so many times depending on the reactions of the tenants and the landlords and the inputs and the problems that they present in this kind of relationship.

What do you mean by the sunset clause with respect to reviewing and changing these rules and regulations?

Mr. Pitura: To answer the honourable member, if the regulation that is drafted as part of the legislative process gets approved, then the legislation is proclaimed and it becomes an active piece of legislation along with the regulation. Certainly in the development of the regulation, the departmental staff who are drafting the regulation must have the public consultation take place.

It is true that when public consultation takes place–and I will just give you as an example the three-month notice for termination of a lease. The public consultation takes place, and generally the tenants that were spoken to and the landlords that were consulted with in this whole process said that that is something we can live with. They say, okay, you can go ahead and use that in the regulation.

However, now the review mechanism in that regulation requires that the Residential Tenancies Branch would bring that regulation back for review within a certain period of time, and they must start developing that review process prior to the actual date, the review date set in the regulation.

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So, therefore, they have to go back out to the consumers again for further consultation. This time around, those particular individuals, both the tenants and the landlord, may indeed agree that three months is not long enough and that it should be six months. So they make a recommendation that we should have it six months. So the regulation is then drafted and revised and amended to read six months.

That is how that process works. I also believe that during the period of time where there is a regulation that is drafted, I would say firstly that the staff within the provincial government do a very effective job of drafting the regulations prior to them becoming law. However, there are some times when a regulation is enacted and one piece of that regulation may not work at all. In that particular case, the department is prepared and willing to come back to the regulatory review committee and to cabinet with an amendment to change that regulation.

So the regulation is very responsive to the needs of the people who are going to be affected by the legislation, and the legislation is written in broad terms because the legislative process takes a lot longer to change, and often by the time the changes take place other changes are required as well.

The regulatory process allows for the more immediate response to changes that is required, and if we are talking about things such as three months versus six months or $300 versus $390, or whatever, in terms of aspects of the regulations, it is much easier through the regulatory process to make that change than it is through legislation.

Mr. Santos: The matter of details such as this is taken care of by the rules and regulations change, let us say the amount of deposit, whether it will be increased or lessened, the duration of the notice, whether it is a three months or longer or shorter and any other details. These are promulgated by the regulatory agency which is the Tenancies–[interjection] Yes.

Now, before a committee of cabinet or cabinet itself can have the opportunity to act on these regulations, are these regulations already being implemented?

Mr. Pitura: The simple answer is no. A regulation has to be approved by cabinet and the proclamation date set for the legislation, set by cabinet, prior to the regulation becoming effective.

Mr. Santos: How are the members of this House who are not members of cabinet able to know when and what are those changes?

Mr. Pitura: Well, all proclamations on legislation and promulgation of regulation are usually published in the Gazette of the Province of Manitoba. But as soon as that is approved and passed by cabinet, it becomes a public document. So at that point in time you are advised of all the changes that have taken place within that piece of legislation and regulation.

Mr. Santos: It becomes public document, there is a time lag there before such public document comes to the public knowledge in the sense that opposition members and backbenchers even in government may not be aware of what cabinet had done because of the parliamentary tradition of cabinet secrecy of its decisions. How shall we be updated if we do not know what is going on inside cabinet chamber?

Mr. Pitura: With the development of legislation, and the member is aware, the legislation that we have before the House right now is the intentions of this government with regard to its legislative agenda. That is basically our role here as legislators, to pass legislation. With regard to the regulation, in some aspects, and I hope the member can appreciate this, if there is a piece of legislation where the regulation identifies that in order to administer the regulation there is a requirement for four full-time equivalent staff to be in place, there is a time lag then required before the department, in particular, is ready to enact on it, because the staff have to be brought in and put into place prior to the regulation and the legislation becoming an effective tool.

So in some cases that is a necessary time lag, but in other areas, usually the process that occurs is that the legislation that will be assented to in this spring session of this House, the regulation will then proceed to be developed for that legislation. Now, in some cases, and this is where our regulation and legislative review process is hoping to have a major impact, is the fact that the development of regulation should take place within a certain period of time after the legislation is passed, because there are pieces of legislation, and I am sure the member is even aware of some legislation that was even passed when the New Democrats were in government last that are still sitting on the books that have never been proclaimed because they never had regulations drafted to support the legislation. You can look back at a number of governments in this province that have had the same thing happen.

So the development of the regulation can sometimes take a few months, it can sometimes take a year. In some cases it takes two years to develop the regulation if it is a comprehensive regulation with respect to an act of the Legislature. So there is that lag time between the time when the legislation is proclaimed and the public are aware that this new legislation is there until the time that it actually impacts the public with the formulation of the regulation.

Mr. Santos: Let us take a concrete example of a specific rule. There is a rule, I believe, that 25 percent of one's total, I do not know if it is gross or net, income is the limit that one can pay for rental costs, let us say, of somebody who is occupying a public housing unit. Is that still the rule, 25 percent, is that total income, net income or gross income?

An Honourable Member: Gross income.

Mr. Santos: Gross income.

An Honourable Member: Whatever is reported to the income tax.

Mr. Santos: Whatever is reported to income tax. Is this rule applicable to both public housing and housing complexes that are operated privately?

Mr. Pitura: No, it is not.

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Mr. Santos: Only attached to public housing.

An Honourable Member: Yes.

Mr. Santos: What about the 27 percent? What is that rule?

Mr. Pitura: That refers to family units in public housing, 27 percent. Individuals are 25 percent. Bachelor units are 25 percent.

Mr. Santos: So a husband and wife is a family unit?

Mr. Pitura: If I am correct in my interpretation here, the 25 percent refers to a bachelor unit type of dwelling, and a family unit would be referred to as a multiple person type dwelling.

Mr. Santos: A single mother with a child, is that an individual or a family unit?

Mr. Pitura: I think we are getting into an area here where we are splitting some hairs, because a single mother with a child could well live in a bachelor unit. As well, a single mother with a child could also live in a family unit. If she and her child chose to live in either one, the one would be 25 percent, and the other one of course would be 27 percent. This would be the gross income as reported on their revenue tax forms.

Mr. Santos: I am just trying to clarify what the rules are. How old should a child be before he can be considered as a separate individual and thus become a family unit rather than a dependant of the mother?

Mr. Pitura: With regard to the age at which a person becomes of age, I guess the statutes of Manitoba recognize a person of 18 years of age as being an adult. However, I am also advised that you could have a bachelor unit which says 25 percent of your gross income is the level at which you pay for that particular unit.

I am advised that there could be, in a bachelor unit–just try to visualize this–you usually do not have a bedroom, so to speak. You have an open area. But let us put three double-bunk beds in there, and we can have six adults. All of those adults could be working at full-time jobs, living in that particular unit. They must pay or could pay up to 25 percent of their gross income. It would not take very long for six adults who are working on a full-time basis to realize that living in a bachelor suite they are going to be paying a fair amount of rent per month. So that is the extreme at one end.

It is designed for the people, as the honourable member was mentioning, like the single mother with the child living in a bachelor unit; 25 percent of her gross income would be the maximum at which the rent level would be paid. So it is kind of a variable type of scale going from a very minimum amount of rent being paid based on the 25 percent to a very large amount based on the number of individuals living in that unit who are generating an income, because all their incomes totalled together constitutes the gross income. I hope that clarifies it for the member.

Mr. Santos: So, in practical terms, these four or six people, all of them making some kind of an income-generating activities, they will not as a result of this policy–even a single bachelor unit, they will be charged 25 percent of their total gross income, all the four or the six of them. So they will not find it acceptable to stay in that little place, and they will be forced to go to some other unit and rent some other unit. Is this applicable to both public housing and a privately operated complex?

Mr. Pitura: It only applies to public housing. Just to draw one more example for the honourable member, if you had a single mom with five children staying in that same bachelor suite with the bunk beds, only 25 percent of her salary goes to pay for the rent. So that is a very economical level of rent to pay in her particular case; of course, the other end of the spectrum was the absurd which I was talking about earlier.

Mr. Santos: Madam Chairperson, it might be economically feasible for the single mother but certainly very inconvenient for all the five kids waiting for the washroom and the toilet when somebody is occupying it or taking a shower, when there are so many people in the same bachelor unit. Is there no regulation or rules concerning health?

Mr. Pitura: Madam Chairperson, just to clarify for the member, the examples I was using are not exactly the correct examples to use. I am advised that under The Public Health Act that there is a minimum space requirement per person in a dwelling, and so therefore there would be a regulation under that act with regard to the number of occupants that could safely occupy a bachelor suite. I think that the honourable member himself would find that most of the public housing units are probably not necessarily overcrowded in terms of the living conditions there.

Mr. Santos: I want to go back to the right of landlord to terminate the lease when there is a plan or a project initiated already and then it affected the duration of the lease of the tenant. Supposing it is right in the middle of the term and the renovation project was initiated by the landlord. Six months in the middle of the one-year lease, the landlord initiated a project. As soon as he initiated, he applies for an exemption. As soon as he applied for an exemption, he notified the tenant that the lease will not be renewed. You have a right to either stay and accept the consequence of this renovation or you move out. That is the legal breaking of the lease, but that is legal. That is according to the rules. How do you solve this inconvenience and these uncertainties in the rental when there is only initiation of the project?

Mr. Pitura: Mr. Chairman, just to quickly answer the honourable member, is that with regards to the lease termination there are two conditions that are in effect. One is that the tenant has the right to stay there until the end of the lease. So the three-month termination notice prior to the end of the lease is valid. The other area that I would advise the honourable member on is that no termination of the fixed-term agreement can take place during the school year. So therefore the lease has to expire at the end of the school year or beyond the school year for the termination of the lease to take place.

Just one little point here. In terms of the practicality of the renovations taking place in a rental accommodation is that if the landlord and the tenants have good communication links between them, they can certainly make arrangements with regard to, well, if you have six months left to go on the lease, the tenant may well be acceptable to that and say, well, I would rather live in a modernized, fixed-up apartment rather than the one I am living in now, so there is agreement to do that.

That is some of the practicality of it. But under the regulations those are in effect, three months prior to termination and no termination during the school year.

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Mr. Chairperson: The House earlier today had agreed that at 4 p.m. this section would move to consideration of the Department of Northern Affairs. So at this time, I thank the honourable minister for sitting in, and we will invite the honourable Minister of Northern Affairs down.