The House met at 2 p.m.
INDIAN BAND AGREEMENT
The Provincial Secretary for Resources Development (Mr. Henderson) gave this House information that we know now to be inaccurate and maybe misleading. In reply to my question --
OLD HOME WEEK
If I may, I would like to distribute buttons and brochures outlining all the activities for this week and for the next few months of the summer. I think the members will see from this material that this is a very special occasion.
I hope many members will come by and see us this week or, if they cannot, at least pay us a visit some time this summer and leave some of their well-earned money there.
Because the horse came sixth, I wondered whether the minister is now going to rebate to any members of his ministry -- who no doubt will have taken this as gospel, as they do all his other advice -- the mortgages they have lost on Sunny's Halo.
STATEMENT BY THE MINISTRY
WOMEN'S DIRECTORATE APPOINTMENT
Over the past week I have had the opportunity to meet with a number of prominent women both within and outside government circles to seek their counsel on the short- and medium-term steps required to move ahead. I have also taken the opportunity to discuss with many of the members of the House the issues that are essential to ensure the full and equal participation of women in all facets of life within this province.
I wish to thank everyone who has spent time with me over the past week. Their candour has been most helpful in clarifying for me the tasks of primary importance that must be accomplished immediately, and those issues that must be discussed and acted upon.
I would like to tell members of the House how impressed I am by the progress already achieved by dint of individual effort, by the commitment and dedication of many people working for the betterment of their peers. In particular, this counsel will be of great benefit to me as I prepare to represent the issues of interest to Ontario women at the federal-provincial-territorial conference of ministers responsible for the status of women, being held in Ottawa next week.
I will not repeat the discussion of last week in which the many steps already taken by this government and by the people of this province were outlined quite proudly. It is sufficient to say at this stage that much has been accomplished, and we have many people to thank for this. Much has yet to be accomplished; the women's directorate offers an excellent opportunity for focusing our efforts.
Of course we will be addressing the needs of women who must be afforded the opportunity to pursue careers both within and outside the home. We recognize that more often than not, career decisions for women are made not on the basis of the job but on the basis of the support services available to them. We will be addressing the need to encourage the development of training options to place women and men on equal footing in the developing field of new technology.
Achieving greater equity and fairness for women in our society demands that these and many more areas be considered. Of great importance is the environment in which women must function. We must ensure it affords the opportunity for equitable advancement in all facets of life.
This is why I am very pleased this afternoon to be able to announce to the House that Glenna Carr has agreed to become the executive director for women's issues.
Glenna Carr has worked within the Ontario civil service for more than 10 years and has been a member of many different committees and task forces charged with the review and development of women's issues. She was this government's first affirmative action manager, working with the Ministry of Treasury and Economics and with the Ministry of Intergovernmental Affairs.
For the past five years, Glenna Carr has been with the Ministry of Municipal Affairs and Housing, first as the director of subsidy and job creation programs and more recently as director of finance policy.
I make this announcement and greet her as she is sitting in your gallery, Mr. Speaker. I am convinced that her experience and her obvious interest in the issues of particular concern to women, and the executive positions she has held within government will serve this assignment very well.
In her new role as executive director, Glenna Carr will co-ordinate the planning, development, delivery and communication of policies and programs designed to assist and encourage women in all aspects of life. Under her direction, the women's directorate will provide the leadership and focus required to achieve our goals and objectives.
May I also take this opportunity this afternoon to report to members of the House that, on my advice, Cabinet Office has issued an instruction that any and all future cabinet submissions must contain an analysis of the impact of the proposal on women.
These are concrete steps being taken to achieve greater equity and fairness for women in the province. I remind all members that much work lies ahead for us and for those working within this new area of responsibility.
I look forward to the continuing support of the members of the House in all endeavours to meet these challenges, and greet Glenna Carr as she assumes her new responsibilities.
EQUAL OPPORTUNITIES FOR WOMEN
In the last busy week in which he has been learning about all these issues, has the minister had time to look at some of the other ministries? Has he looked at Education and Colleges and Universities, headed by his colleague to his right, the one who was scowling when he was reading his statement? Is he aware that women make up 56.7 per cent of the staff but earn only 62.9 per cent of the amount earned by the average male?
Is he aware that in the Ministry of Consumer and Commercial Relations women make up 62.8 per cent of the total staff while earning only 66.3 per cent of the salary of the average male, or that in the Ministry of Municipal Affairs and Housing, women make up 53 per cent of the total staff but earn only 64.1 per cent of their male counterparts' earnings? The list goes on.
Is it the minister's explanation that the same criteria apply to these other ministries? Why are they almost as bad as his own and why has no progress been made?
I did remind the Leader of the Opposition, when he was pointing out the situation in my ministry, that it provided an excellent opportunity to point out there is a great deal of work to be done in freeing women from what one might call the question of occupational segregation, so that they would see career opportunities in other professional endeavours. I pointed particularly to one very low percentage -- I think my colleague the Minister of Colleges and Universities (Miss Stephenson) would agree -- namely, that less than two per cent of the graduating classes in engineering schools are women. Surely something has got to be done to improve on that category so that when ministries such as mine or ministries looking for engineers are out in the job market, there are candidates available.
The record is there; the report is there. I cannot change the report. There is obviously room for improvement and we are going to do something about it.
Is the minister aware that in his own ministry only 31.6 per cent of the training and development dollars is going to women, even though they comprise some 50 per cent of his staff? Further, only 11 per cent of the women employed at the ministry received accelerated career development initiatives. Surely the minister has to start in that area to prove his bona fides.
I can point out promises after promises made by a succession of ministers prior to him who were responsible for the same thing, but no progress has been made. How do we know this minister is going to be able to make progress when everyone else has failed?
I remind the Leader of the Opposition that I thought the minister was at least open enough to say the facts contained in that most recent report are there. We are going to work to improve upon them. In all fairness, he should make some comparisons over the years to show there has been some progress in this area. We should not lose sight of that.
When we talk in terms of the options or opportunities that are available, I assume we still believe in freedom of choice. Whether people take advantage of those particular opportunities or not, really becomes a personal decision, but with whatever encouragement we can give because of the new organization here, we aim to do our best to improve on those figures.
I also would remind the leader that both of these items are on the agenda of the national meeting, which opens next Monday night. Indeed, Ontario has been asked to take the lead in the discussions in the whole area of affirmative action.
I remind him of the trail of broken promises in this area, as I said, by a plethora of former ministers responsible. I refer him to the then Minister of Labour, now the Minister of Consumer and Commercial Relations (Mr. Elgie). who promised an employment strategy. He said, and I quote from Hansard on page 4236 in 1980:
"The Ontario Manpower Commission, in co-operation with the Ontario region of the Canada Employment and Immigration Commission, is working towards the completion of a women's employment strategy report. I expect to receive that report and to present it to my colleagues within the next month or two. Judging from the work of the commission in its other undertakings, I have no doubt that the report will be a thorough and comprehensive analysis and evaluation of a broad range of topics."
Is the minister aware that this report has never been forthcoming? It is only one more broken promise. Will he give us his undertaking that he will come forward immediately with that report promised in 1980?
I can assure the member on the basis of what I have read and as a result of my discussions that there are some further statements to be made along those lines. I do not want to be tied down to a specific time just at the moment.
The minister, I gather, is going to bring Bill 14 forward for second reading today. Is the minister aware that in the last few days there has been a great rush to close a large number of land transactions involving share transfers held beneficially by foreign owners? A number of people are rushing to close those deals in order to beat his tax legislation.
He is aware, of course, that he originally introduced the bill, at least in similar form, on December 10, 1982, and there has been ample warning to all of these people that there was going to be a change. Is he aware of the extent to which people are rushing now to beat his tax initiatives, which were introduced in the budget and given first reading on April 21? How much of it is going on?
I am sure part of the debate may very well end up being whether there should be some retroactivity to the date of introduction on this legislation. I would be happy to hear the views of the two parties opposite in that regard.
Why would the minister be so dumb as to bring in a tax matter that was not retroactive to the day of first reading, like almost every other tax measure in this House? It was straight incompetence on his part. Notice was given. Why did he not think out the matter in order to beat this abuse of the system?
In terms of the question, as I indicated in my answer to the original one, I would be very happy to hear the views of the two opposition parties on that issue. If there is unanimity on that side on that issue, I may look favourably upon that kind of amendment.
In any event, we are going into second reading of the bill this afternoon. In the debate I am quite prepared to entertain the views of the parties opposite on this issue and may very well entertain an amendment or place an amendment that would make some retroactivity, based on the notice given when the bill was tabled for first reading.
What is the logic of introducing an amendment to close the loophole if that amendment does not come into effect the day the amendment is introduced? Why is he telling us he would entertain an amendment to make it retroactive when he knows we are dealing with a tax bill, and he knows the only person who can introduce that kind of amendment is the minister himself? Why is he passing the buck to us?
PRIVATE NURSING HOMES
The statement shows the company made a profit of $362,000 on revenues of $2.2 million. This means the company earned clear profits of $4.93 per resident per day. At the same time as the company was earning those profits, it spent about $1.90 a day per resident on food, excluding wages, and spent $400 for the entire year on recreation.
Given the fact that well over half the revenues for this nursing home, as for all the other privately operated nursing homes in this province, come from the Ministry of Health's budget and the taxpayers of this province, does the minister not feel it is time we started regulating the profits of these companies operating in Ontario to guarantee the money earned by these nursing homes is reinvested in the same homes and not taken out by the owners?
The member has not provided me or anyone else with the slightest bit of evidence that the nursing home is not providing an excellent standard of care; that is my concern. They are providing excellent care so the answer to the question is no.
The evidence shows that in 1980 the owners of this company took nearly $500,000 out of the company in various ways. Some of that money was invested in the purchase of a new nursing home in the United States of America.
Does the minister not think it fair that money spent by the taxpayers of this province and the residents of that home be reinvested in that home? Is he seriously saying the best he can do is simply to give the money away to these private owners and say, "Go and play the market with public money"? Is that what he is encouraging, playing the market with public money?
Using the profit figures contained in the financial statement, is the minister aware that if the home were run on a not-for-profit basis the public subsidy could have been reduced by 30 per cent, the standard of care increased dramatically or the residents' fees reduced substantially? Does he not see the blatant contradiction in subsidizing this kind of profit-making by merchants of care when a higher standard of care could be provided for exactly the same money? Does he not recognize the standard could be substantially higher if nursing homes in Ontario operated on a not-for-profit basis?
Until the member points out that this nursing home, which he wants to slander, is not providing adequate quality of care for the money it has lawfully earned he has absolutely no case to put.
All the rhetoric he wants to develop and all the press releases he wants to put out are not going to deny what this government has done. It has provided more nursing home and extended care beds per capita than any other jurisdiction he knows of and has provided an extraordinary number of community-based programs to assist the elderly as well. If he wants to put the proposition that all those beds would be dramatically better off if they were government run or government owned, he should do so. But he should not say this government does not care what happens to the people in those beds.
To sum up, the member should be able to understand --
DEATH OF DAVID HARVEY
Another point raised at the coroner's inquest was particularly disturbing. The Labour ministry inspector, Mr. DeMeer, testified that he had not checked the premises during the one and a half years he was responsible for the area. He also acknowledged that the company had no set safety program. He said the tank in which Harvey was found did not have readily accessible exits and was not ventilated according to the Ontario Occupational Health and Safety Act.
This is an unorganized plant. My colleague the member for Sudbury East (Mr. Martel) has demonstrated time and again the very real difficulties that workers in unorganized plants are facing. What is the minister going to do to see that the act is enforced and that inspections are regular so that tragic occurrences of this kind do not happen in this province?
Considering the cycle that the minister has pointed out in the David Harvey case, how can he justify those kinds of statements by people on his staff? Is it not time he accepted the recommendations of our health and safety task force for health and safety committees, for increased inspections and enforcement, and for mandatory health and safety training and protection of unorganized workers across Ontario?
I fully appreciate the efforts of our inspectors in looking after the work places. I feel that on balance they do a truly outstanding job and this is an isolated case as far as I am concerned. That was the main --
FARM ADJUSTMENT ASSISTANCE PROGRAM
Will the minister personally get involved and try to expedite the processing of these applications so these farmers can get operating capital or assistance through OFAAP in order to get their crops planted?
Will he also give consideration to those farmers who have a high debt-to-equity ratio? Far too much emphasis is being placed on the viability aspect of these farmers and all they are asking is, "Give us a chance to prove we can be viable within the next year." Let us make the criteria for the viability of the farmers a little more lenient. Why does the minister not help the farmers out instead of doing nothing over there?
Mr. Speaker, I point that out only because it seems this kind of speech is made only for the benefit of people in the gallery. We do not hear it on other days.
As I understand -- and please correct me if I am wrong -- the proposal made to me this morning, and I undertook to give an answer in the next week, it is as follows: in certain individual instances or cases, regardless of the amount of debt outstanding or the source of the debt, whether it be to a lending institution or to supplier creditors, that debt be set aside, and for the purposes of a program of guarantees of operating credit -- not taking into consideration that proposal is based on the premise or assumption that the existing creditors would waive their rights under section 178 of the Bankruptcy Act of Canada; notwithstanding all that -- the government of Ontario should be prepared, virtually in any case, to grant or stand behind or guarantee a line of operating credit for 1983, based on, and I have pressed this point with them, whether or not the proposed operation in 1983 was viable in 1983, again putting to one side any outstanding debt.
That is a significant departure from any other program in place. We do -- and I am not quite sure what the member was trying to infer in his question -- as a matter of course in the farm assistance program require that it be shown that the individual farm enterprise be viable.
As the member would know, every farm has to be treated separately and distinctly from every other farm in the province because of the combination of the size and type of the operation, the quality of the soil, the extent of indebtedness. When taken together, all of those things add up to a unique situation. Every farm in the province is different from all of the others in the province, so they have to be judged on an individual basis.
I was very frank with the group, and the member can check with one of his colleagues who was at the meeting. I have some difficulty with two aspects of what they are suggesting. One is that we would somehow put to one side the matter of any outstanding debt because, first, we cannot be sure that creditors will waive their rights under section 178. Quite frankly, a lot of it is based on the assumption or the hope that Bill C-653 will pass in the House of Commons in the way in which it was proposed. I do not think that is at all certain from what I am hearing from Ottawa.
The second aspect is that the government would take the crop as security. I have a lot of trouble with the notion that the government would stand first in line and, in some cases, have to go in and say, "We are taking that corn, we are taking those soy beans" or whatever "back to the government." I had a lot of trouble with both of those.
I would point out to the member that the farm assistance program has helped a great many people.
At the outset of his question the member inferred that there had been a delay in individual cases that had been approved. If that was the inference he was trying to transmit, I ask the meniber to give me names. I have always asked him for those. If the member will give me names I will check them out, as he knows, and where we are wrong we correct it.
Further, would he have his staff work overtime this next week across Ontario and here to see that as many of these applications as possible are processed within the next week so they will be of some benefit to the farmers?
Last year, when there was a much heavier flood of applications, we pulled staff out of the colleges as they finished the academic year and assigned them to the heaviest counties -- including Grey, when I come to think of it -- to keep up the processing of the applications.
The criteria are fairly wide now. As the member knows, one of the key ones is the question of equity: 10 per cent to 60 per cent. We do go below 10 per cent but we are not allowed by the order in council that established this program, passed by cabinet about 18 months ago, to consider applications where there is negative equity.
But we do go below even the 10 per cent figure and we have approved a number of applications under OFAAP where they have had less than 10 per cent equity. I believe in a couple of cases it has been literally a fraction of one per cent equity; but where it looked as though the farm plan proposed was viable, and given everything that was known at that time about what was happening to those commodity prices and interest rates, all the things that would have an impact, they were approved.
There are going to be hundreds of farmers who will not plant this year. Apart from the 110 that his ministry has turned down, there are hundreds of others whose applications have never been processed or are in the process now of going through OFAAP.
Would the minister not think it reasonable that farmers who planted a crop last year should also be given the opportunity this year to plant a crop up to the limits of last year's expenditure? Would he not immediately issue a certificate to those farmers, recognizing the limited number, so they can plant their crops and have some hope this fall of being able to pay back not only this loan but also other loans they took out last year and over a long period of time?
The whole point of including viability in the farm adjustment assistance program right from the beginning has been our conviction on this side of the House that we should be giving assistance where there is a chance to hold on to or regain viability, given everything that is known at that point, as I just said in answer to the member for Grey (Mr. McKessock), about the prices for the commodity they are producing, about interest rates, about all the things that impact on the applicant and his farming application.
I stress again that every single case is treated individually, because no two are the same. The reason we do that is, on the basis of the information provided to the provincial decision committee, if it appears that based on what happened in the previous year and what they propose to do in the current year they are going to put themselves deeper and deeper into debt, it is our view that we do not do them any favour by helping them dig a deeper hole. That is why we have placed so much importance on the question of viability.
Admittedly it is a judgement call. We believe we have some very well-qualified people who are making those judgements. The ag reps and any number of my specialist staff in the ministry have input. There have been many cases where the provincial decision committee has felt that the submitted farm plan is not viable and we have gone back -- through our ag reps, our soil and crop specialists, our livestock specialists, any number of people in the ministry -- and have helped the individual prepare what would be a workable, viable farm plan.
GRANTS TO MUNICIPALITIES
I would like to ask the minister whether he is aware that in the city of Chatham the welfare budget is up by 35.7 per cent; in London it is up by 49.7 per cent; in Sudbury it is up by 39 per cent; in Hamilton it is up by 20 per cent; in Sault Ste. Marie it is up by 71 per cent; and in the city of Windsor it is up again over and above last year's figures, which were record figures as well.
All these municipalities are suffering considerable increases in welfare costs because of the recession and therefore the welfare costs are passed on to the municipal taxpayers. The minister indicated last November that he would consider ad hoc grants to these municipalities to assist the taxpayers, and now there seems to be no announcement. Is the minister going to be assisting these municipalities or is he not?
If the honourable member will recall my remarks some months ago, I said clearly that we would be looking at special grants to municipalities upon their application indicating to us the pressures on their tax systems in relation to the loss of tax revenues, the assessment factors going down and the other things that go together to make the case for them. Indeed, I gave that same message just a week ago to the member's mayor.
I said, and I repeat, that I have met with the mayor and some of the council from Windsor and we will review that case as the facts and figures come forward.
All the mayors and their administrators across the province communicate on a fairly regular basis with the field officers of the Ministry of Municipal Affairs and Housing, who give them the background that is required to make an application if they believe that a special grant is required from the province of Ontario. It is not a secret; it is right there for the observation of those communities that wish to avail themselves of it.
PURCHASE OF TTC VEHICLES
Is this new policy not at variance with the government's buy-Canadian program, and does it not invite trade sanctions both internationally and in Canada against Ontario transit technology and perhaps even against other products, such as steel?
I had a letter from Mr. Porter, the chairman of the TTC, some little while before my reply with regard to the acquisition of a number of new vehicles of various types that they will need over the next few years. I replied to this letter suggesting that after giving it full consideration I felt it would be in the best interests of all concerned -- the TTC, Metro and the province of Ontario -- if a long-term contract could be negotiated with UTDC-Hawker Siddeley, taking into consideration the fact that the design of the streetcars had been developed and paid for by UTDC and that of the subway cars by Hawker Siddeley and the TTC.
I thought it would be only reasonable to continue having those vehicles supplied by the supplier that had been used in the past; as well, of course, it would maintain a lot of employment within the province. It is not a vendetta; it is not a trade barrier against anyone else. Parts, supplies and components for those vehicles, I am sure, will be coming from a number of other provinces in Canada, but it so happens that they will be assembled in Thunder Bay.
"Therefore, in the light of all the benefits and the contributions from the province of Ontario for 75 per cent funding, the government of Ontario requests you to enter into direct negotiation with UTDC-Hawker Siddeley for the provision of this equipment."
Notwithstanding that, the minister has also been quoted in the paper as saying, "UTDC vehicle prices are and will continue to be competitive with prices anywhere else." If that is the case, what is his aversion to public open competitive tenders? What is he afraid of?
Whether the TTC had called tenders on streetcars or subway cars on a worldwide basis, or whether there would have been any bidders other than those that bid on the US international contracts -- I might say there was only one US bidder on those contracts as well -- we have the technology, we have the manpower, we have the expertise, both in design and in manufacturing. I could see no reason why I should encourage the TTC to go on a worldwide tender basis.
Has the minister or the Ontario Provincial Police investigated, or will they be investigating, whether Mr. Davids or Mr. Fruitman, whichever name he happens to go under, committed an offence in signing a contract to build a robot when he had never built one before and when his company was clearly not in a financial position to undertake such a venture?
As I said on the first question, I would be pleased to pass that along to the Solicitor General and to the Attorney General.
PURCHASE OF TTC VEHICLES
I told them my main interest was in seeing that plant avoid the ups and downs it has had over the past 20 years. Perhaps it cannot maintain a 1,200-man work force. Perhaps it can maintain a 500- or 600-man work force. In doing so, if we can avoid bunching up the orders, we can maintain a steady work force and not have the uncertainties those workers have faced in past years.
I also told them it had to be competitive in an international market, because we had to be able to get orders offshore, outside of Ontario and outside of Canada, if we were to keep even a 500- or 600-man work force busy.
In talking to the management and the union presidents I met with, they complimented me on that position. I assured them we would do everything to bring as much work as possible to that plant and it was not going to be maintained on government force-fed contracts, if we want to call them that.
RESPONSE TO WRITTEN QUESTIONS
It asks in part: "Would the Minister of Health advise the House as to his current timetable for the implementation of the chronic home care program? Specifically, what counties, districts or cities remain uncovered by this program? When can the county of Renfrew expect to hear of its inclusion in this health care initiative?"
I note there is an asterisk of sorts --
Mr, Speaker, I ask you to consider two things. Will you investigate to satisfy yourself that this is not just a typographical error? It may be that. Surely the ministry is not indicating to me that it cannot tell me for at least eight months what its current timetable is.
I understand the circumstances whereby ministers are going to need and want additional time. It is often reported to us that it is necessary. I as one member am quite prepared to extend that consideration in fairness and in a good parliamentary way. However, when I look at my question 195 and see that we are not going to get the information for eight months, I have to think that represents a contempt of parliament.
That is a major public policy being entertained by this government. I know the minister is a busy man, but surely if we are to play by the rules -- and I draw your attention to standing order 81, particularly 81(d), which says answers shall be provided within 14 days unless the minister indicates it is going to be complicated and costly or time-consuming. I think the minister, as an active parliamentarian in this place, would not want any of his colleagues in this House to be left with the impression that he is in contempt of parliament. I hope he will rectify the information contained in today's notice paper.
For the minister to suggest that he cannot give us for another eight months his current timetable for the implementation of a major program in his ministry, one that has been ongoing for two years, is laughable if not contemptuous.
I am trying to point out that I put that question on the order paper over 18 months ago, and 18 months ago it was indicated to me that there would be an answer in six weeks. According to this, we are not getting the answer until December 31. If there is an answer today, I will cede my place.
INTRODUCTION OF BILL
MUNICIPALITY OF METROPOLITAN TORONTO AMENDMENT ACT
Mr. Grande moved, seconded by Ms. Bryden, first reading of Bill 48, An Act to amend the Municipality of Metropolitan Toronto Act.
Motion agreed to.
ORDERS OF THE DAY
The following bills were given third reading on motion:
Bill 1, An Act to amend the Provincial Courts Act;
Bill 25, An Act to amend the Solicitors Act;
Bill 28, An Act to amend the Small Claims Courts Act;
Bill 29, An Act to amend the Estates Administration Act.
LANDLORD AND TENANT
Hon. Mr. Sterling moved, on behalf of Hon. Mr. McMurtry, third reading of Bill 32, An Act to amend the Landlord and Tenant Act.
We appreciate the government following that leadership. We wish the government would, in fact, follow the leadership of the member for Etobicoke and the New Democratic Party in providing adequate protection for all tenants who are victimized or threatened in the market today.
Motion agreed to.
LAND TRANSFER TAX AMENDMENT ACT
Hon. Mr. Ashe moved second reading of Bill 14, An Act to amend the Land Transfer Tax Act.
The nonresident may also escape payment of the proper tax by acquiring the beneficial interest of a trust that owns agricultural land. As well, a nonresident may at present avoid the proper tax by arranging his financial participation in a corporation that owns agricultural land in such a way as to avoid the technical definition of a nonresident corporation.
The measures contained in this bill will help to contain ownership of one of our most important natural resources, agricultural land, in the hands of Canadians. In those situations where ownership does pass to nonresidents, they will no longer be able to avoid the tax rightfully due on the transactions by manipulation of the circumstances surrounding them.
This bill will also contain amendments that will make the administration of the provisions of the Land Transfer Tax Act more efficient and effective. It will provide a greater degree of fairness in the application of certain provisions and will provide more consistency with other taxing statutes. These changes will see the notice of objection and appeals provisions extended to refund disallowances, and will allow a nonresident to acquire agricultural or recreational land and pay a reduced rate of tax when acquisition is for a certain specified purpose.
Other changes will recognize that a single affidavit has replaced the consideration and residence affidavits and established the value of consideration as fair market value in transfers between shareholders and a corporation or from one trustee to another. Other administrative amendments will deal with definitions in the act and provide interest provisions consistent with other taxing statutes.
So I borrowed a dictionary from the clerk of the assembly and looked up "progressive." It is defined as follows, "Characterized by moving onward, moving forward, of the nature of onward motion." There were a number of other definitions, but the one which struck my fancy said, "Progressive conservatism is to adopt liberal principles and say they are always one's own."
Progressive Conservatives in this case have adopted Liberal principles. Going back through Hansard, I noticed that on December 5, 1978, I asked the former Minister of Agriculture and Food if he was aware of the widespread and serious concern about block purchases by foreign investors of agricultural land in Ontario. I also asked if it was true that foreign interests were circumventing the land transfer tax by forming Ontario corporations, and whether he would undertake a survey of current foreign ownership of rural lands in Ontario and monitor all new land transfers.
It has been four and a half years since I raised this matter in the Legislature and now we have a bill that requires nonresident foreign purchasers of our land to pay a 20 per cent land transfer tax. We hope it will plug the loophole. The main purpose of this bill, as stated in the explanatory note, is to prevent a nonresident from avoiding the 20 per cent tax imposed on conveyances of land by purchasing shares in a company owning Ontario agricultural land.
We support this amendment, and I would add that it is long overdue. It is just another example of a government that will act on a problem only after it becomes painfully obvious that a situation no longer can be tolerated and it is so controversial that the government must be seen to be doing something.
Even though this minister introduced this legislation, he continues to maintain there is no problem out there. As he stated at the time of the introduction of this amendment, "We frankly do not think that it is an extremely large loophole, but obviously a loophole becomes larger when more and more people become aware of it."
I know, and the minister knows, that this government has lost millions of dollars through the avoidance of land transfer tax. I know this because I or my researchers have been talking from time to time with Ministry of Revenue officials. They tell the truth. They have told us this government has lost millions of dollars through the avoidance of land transfer tax.
Even now, when we raise the question in the Legislature, we know the government stands to lose in five counties, where the push is on at present to complete the transactions for foreign ownership of this land. The government stands to lose a quarter of a million dollars between now and the time this bill is proclaimed. Just think what the farmers could be doing today with the millions of dollars this government has lost through the circumvention of land transfer tax.
The fact remains that thousands of acres of our most productive agricultural land in this province are being purchased for speculation by foreign nonresident interests, The extent of these purchases has never been seriously or completely investigated by this government. The true purchasers of this land are unknown, and the details of the purchases continue to be denied us.
Not only have the foreign purchasers avoided the government's Non-resident Agricultural Land Interests Registration Act, but they are also avoiding the 20 per cent land transfer tax on nonresidents. We hope this amendment will close the loophole in the Land Transfer Tax Act.
It is a mystery why this government has waited so long to act on this problem in view of the fact that the problem was recognized when the Land Transfer Tax Act was announced in the budget of 1974. At that time it was stated, "Where a nonresident acquires control of a corporation which owns land in Ontario this will be deemed to be a transfer of land and the tax will apply." The government, however, never introduced this section of the bill, for whatever reason. That is why we are debating this amendment today.
I would like the minister to indicate to us, in his response, the amount of money his ministry estimates has been lost by the government as a result of this loophole in the legislation. My information tells me the government has lost at least $48 million. I would like the minister to confirm that. This lost revenue could have been used to provide financial assistance to help many of our farmers survive bankruptcy and thus not to have been forced to sell to these foreign purchasers.
I would now like to go into a little bit of the history of this problem of nonresident ownership of agricultural land, which we in this party have been pressuring this government to act on for more than five years. In fact, as far back as 1973 a select committee of this Legislature on economic and cultural nationalism recommended to the government in its report on foreign ownership of Ontario real estate that "future acquisitions of land by individuals, including agricultural land, and the opportunity to farm in Ontario should be restricted to Canadian citizens and landed immigrants residing in Canada."
Needless to say, that recommendation was rejected outright by this government, and the true indication of how the government viewed this suggestion was that a member of the government party on that committee, who later became the Minister of Agriculture and Food -- I am referring to Bill Newman -- was the one dissenting vote on the recommendation.
Pursuant to my private member's bill in 1979, which would have required the registration of all foreign-owned land in Ontario, the province introduced its own act in 1980. While the act came into force on December 1, 1980, and a final report on the extent of foreign ownership in this province was to have been released by the Ministry of Agriculture and Food on December 1, 1981, no such report has yet been made.
We were provided with another interim report in December 1982. This report demonstrated very clearly the need for the government to become serious about this problem and to come to grips with this very disturbing trend. While the government continues to maintain that this problem is insignificant, this latest report shows that nonresidents now own about 152,000 acres of agricultural land in this province, if we are to believe this figure.
We have demonstrated to the government on a number of occasions the ease with which foreign purchasers have bypassed this legislation. Based on the government's figures, however, nonresident ownership in this province has increased by more than 100,000 acres since the government's last registration report, one year previously. Moreover, we still do not know the full extent of this problem, since the government has failed to adequately monitor this situation after years of procrastination.
In November 1982, the minister will recall, this party released details of corporations and individuals who were able to circumvent the registration legislation as well as the Land Transfer Tax Act. Those details involved 3,585 acres of farm land in Huron and Bruce counties. These parcels were discovered after detailed research at the local land registration office and represented only a fraction of the sales that have occurred throughout the province unknown to this government.
In those sales alone, a total of $845,136 in land transfer taxes had been circumvented. We find these transactions alarming because they are only a small reflection of a much larger problem.
Under the existing legislation, foreign purchasers were required to pay 20 per cent of the purchase price in compliance with the Land Transfer Tax Act. By comparison, resident buyers are required to pay only two fifths of one per cent of the first $45,000 and four fifths of one per cent on the remaining purchase price.
The spirit of this legislation was clearly being violated with the transfer of land through shares of a company. Unfortunately, while this amendment will plug this loophole, there is still no means of ensuring that nonresidents forming Ontario companies to purchase land will register under the Non-resident Agricultural Land Interests Registration Act. This can be ensured only by an amendment to the Corporations Act to the effect that land companies with nonresident ownership must first register with the Non-resident Agricultural Land Interests Registration Act before they file under the Corporations Act.
Moreover, in the cases we had documented, the individual who was acquiring the land for other unknown buyers will not have to pay the 20 per cent land transfer tax in the future, since he has now become a landed immigrant. He has already established a number of companies into which he will amalgamate future land purchases. These companies in reality represent the shares which are owned by the true, nonresident investor. Therefore, this amendment will be bypassed in this manner.
I want to give the minister an example of the way in which this legislation will be circumvented. The minister may recall the concerns I expressed on former occasions about a person known as Helmut Sieber, who was acquiring the agricultural land for other foreign interests. This was borne out in the cases we personally examined.
Helmut Sieber is now a landed immigrant. He has bought a number of acres under numbered companies, some of which are known as Underwood Farms Ltd., Frangis Farms Ltd., Manica Farms Ltd. and Elderslie Farms Ltd. Mr. Sieber can continue to acquire land for these companies as a landed immigrant and thus not pay the 20 per cent foreign tax.
As a matter of fact, I had a phone call this morning from a very adamant person in Huron county who told me that Sieber owns well over 4,000 acres in Morris township. He said, "Jack, if you can't pound any sense into that group of people sitting across from you, being a cattleman, I am prepared to come down to the Legislature with my cowboy boots. When I load cattle I have a cane in one hand and a whip in the other. Believe me, I am prepared to do a lot of whipping down in the Legislature unless we can get the goverment to come to its senses about this whole matter of foreign ownership of land." This man knows Helmut Sieber very well.
How does the government intend to find out where this money is coming from? Where is Helmut Sieber getting all this money to buy this land? Is Sieber surreptitiously acting as an agent for foreign investors?
If the minister had acted when we first drew his attention to the method that was being used to avoid the land transfer tax, the government would have collected millions of dollars in taxes from the sale of land to nonresidents.
Furthermore, the tax may have served as a deterrent to foreign purchases of our farm land, in which case the young Canadians who wanted to farm would not have been denied that opportunity. It is very difficult for our farmers to compete with foreign investors, who in most cases were and are buying our agricultural land for speculative purposes and totally ignoring the value of the land.
If it were in order for opposition members to amend tax bills that would require an expenditure of money, then I would be making this legislation retroactive to the day the land registration bill came into effect. But as I indicated to the minister in question period today, opposition members cannot amend tax bills where money is involved. The minister knows that, and I do not know why he insists that the opposition members should take upon themselves the responsibility of putting an amendment to that act. It is the minister who should bring in that kind of amendment. If he does, we will support it.
The millions of dollars this would generate could assist our farmers to survive the greatest economic crisis they have faced since the Depression in the 1930s. Perhaps the minister could see some merit in making this legislation retroactive, considering the fact that foreign purchasers and their agents have deliberately used manipulative ways to avoid paying the land transfer tax for nearly a decade now.
I want to ask the minister how he intends to police the legislation so the government can ascertain the source of the money that is being used to buy our agricultural land. I also want to ask the minister whether the information acquired through this legislation will be cross-referenced with the registration act of the Minister of Agriculture and Food (Mr. Timbrell).
It is my understanding that at present the real concerns of Helmut Sieber and other foreign purchasers or their agents, such as Wolf Von Teichman, are not the extra 20 per cent tax, since land values have dropped significantly during this recession; rather, their concerns are focused more on having to register under the Ontario Ministry of Agriculture and Food land registration legislation.
The point I am trying to make is that the foreign purchasers of land and their agents are not so concerned now about having to pay the 20 per cent land transfer tax, because the price has dropped right out of the land market. It has been cut in half in most cases. They are quite prepared to pay the 20 per cent land transfer tax, knowing they are still getting a very good buy on our agricultural land. Their concern now seems to be having to register that land under the Ontario Ministry of Agriculture and Food land registration legislation.
For reasons I do not fully understand, the foreign purchasers of our agricultural land do not want to be identified as foreign nonresident owners. It may well be they believe that if the government ever becomes concerned about the loss of agricultural land to foreign interests, the nonresident foreign owners would be the first to feel the effects of any action the government might take.
I hope the government comes to its senses before we find the last primary resource we own in this country has been sold in large measure to foreign interests. Ontario has pretty well given up the shop in connection with most of the other resource sectors; surely agricultural land will not be allowed to go the same way.
We are hoping this legislation might act as a deterrent to further foreign control of our agricultural land. Failing that, the government will have no alternative but to present legislation governing the ownership of land similar to that which has been enacted in practically every other province in Canada.
We in the opposition are concerned not only about the loss of our agricultural land to foreign interests but also about the long-term effects on rural communities resulting from increasing nonresident concentration. I would encourage the minister to take a trip through rural Ontario to see firsthand the effect that a declining population has on local businesses, schools, churches and other farmers who are unable to compete with the prices foreign buyers are willing to offer for land.
Another very disturbing aspect of the foreign ownership of farm land is its concentration within certain areas of Ontario. In certain areas, the extent of the foreign buying is not one per cent as the Minister of Agriculture and Food maintains but, rather, five or 10 per cent; it has even been estimated to be 15 per cent in one township, Morris township, in Huron county.
The person who phoned me this morning has a record of all the land that has passed into foreign ownership. He was the one who told me that 15 per cent of the 54,000 acres of agricultural land in Morris township has been sold to foreign interests. As I say, he is livid about this.
We in this party do not want to see our agricultural land controlled by nonresidents, as are other sectors of our resources economy. We will continue to urge this government to take action on this question before it leads to the deterioration of rural communities, making farmers feudal tenants.
Mr. Speaker, if you think I am the only one concerned about the foreign ownership of our farm land and the way in which foreign interests have been avoiding the land transfer tax, I would like to refer to you two articles in the Toronto Star, one of December 17, 1982, and the other of December 4, 1982. I am going to quote from the article dated December 4, 1982.
"Members of the Ontario Legislature have got hold of the wrong end of the stick in their current debate about foreign ownership of farm land in the province.
"Liberal members -- most notably Opposition Leader David Peterson and Huron-Middlesex MPP Jack Riddell -- have been complaining that a quirk in the land transfer tax law has enabled foreign buyers to escape paying a special 20 per cent levy on the value of the land they purchase.
"And now Agriculture Minister Dennis Timbrell has promised to eliminate the quirk and collect the tax."
I do not know whether the Minister of Agriculture and Food was talking to the Minister of Revenue (Mr. Ashe), prompting the minister to bring in this amendment. If he has, I have to give the Minister of Agriculture and Food credit.
But let me continue the quote.
"They're all missing the point. Instead of imposing tax penalties on foreign buyers, the government should prohibit foreign ownership of Ontario farm land.
"Oddly enough, such prohibition was part of the Liberal Party's platform in the 1981 provincial election. It made sense then and it makes sense now.
"There is after all little that is more vital to a country's stability and security than its ability to produce food. Canada's agricultural production has ever been, and must remain, a major component of our economic development. We need to husband our rich farm lands to produce as much food as possible, not just to feed ourselves but also to feed the hungry in other parts of the world.
"It may be argued that food production is not dependent upon who owns the land. The chances are, however, that a foreign owner -- particularly an absentee one -- is less interested in long-term productivity than in rapid profits. With such a goal, careful cultivation and crop rotation to preserve the soil's fertility may be ignored. And the temptation to sell to developers for large profits may well become irresistible.
"Under such circumstances, land can go out of production, dimishing our security of food supply or raising food prices.
"Even more important is the principle involved. Agriculture is a major Canadian resource, right up there with oil and gas. Canadian policy currently aims at bringing our energy resources into Canadian ownership so that Canada and Canadians can decide how those resources are to be developed for our benefit and not for the benefit of strangers in a foreign land.
"The same policy should apply to farm land; the Ontario government can apply it by banning the sale of farms to foreigners."
I conclude my remarks by quoting from an article that appeared in the Windsor Star on December 17, 1982. The writer makes the point well; I do not think anybody could do any better.
"Foreign interests purchased the equivalent of a 120-acre farm every single day last year in Ontario. At the end of last year the equivalent of 1,500 100-acre farms were owned by foreign interests. Foreigners, particularly Europeans, have found that Ontario is indeed the Province of Opportunity where land bargains abound because farmers have fallen on hard times.
"A recent report issued by the Ontario Ministry of Agriculture points out that 396 foreign individuals and companies now own more than 150,000 acres of Ontario farm land.
"Oddly enough, those figures do not seem to concern the minister of agriculture. According to Dennis Timbrell, foreign ownership isn't a serious problem and he has no plans to introduce control legislation because the study shows that only one per cent of provincial farm land is in foreign hands.
"It's amazing how the minister is able to so easily dismiss 150,000 acres of prime farm land and a disturbing trend that seems to indicate Europeans find this a good place to pick up a farm on the cheap.
"It's also amazing that the minister, who is actively involved in promoting greater markets for the products of domestic farm land, should at the same time seem indifferent to the growing foreign ownership of the same farm land.
"He glibly dismisses the numbers as only one per cent, but that is based on a total of some 16 million acres of agricultural land in Ontario, much of it marginal. The land being sought and bought by foreigners is the very best.
"The Liberal agriculture critic, Jack Riddell, has warned of the possibility of Ontario farmers becoming little more than `feudal tenants' on foreign-owned farm land. He charges that tough times are forcing farmers to sell out and in many cases foreigners are the only buyers they can find.
"Clearly, what is happening is that affluent foreigners are benefiting from our hard times while at the same time gaining control of a significant chunk of our best food-producing land.
"Timbrell needs to be reminded that foreign ownership of something as valuable as farm land is not a minor issue to be swept carelessly away but something that affects not only this generation but generations to come. The current figure of one per cent is perhaps an acceptable level, but if it continues to grow, as it appears to be, then the minister should seriously consider introducing control legislation.
"Perhaps the province's licence plate slogan of `Ontario -- Keep It Beautiful' should be shortened to simply `Ontario -- Keep It.'"
I know I have digressed a wee bit from this bill in talking about the foreign ownership of farm land, but it is a problem we have to deal with, and I only hope that a start has been made by the introduction of this amendment to the Land Transfer Tax Act.
It remains to be seen how effective this amendment is going to be, however. As I indicated previously, the foreign investors are not overly concerned now about the 20 per cent land transfer tax, because the value of our land has been cut in half. They know it is a good buy to pay the much-reduced price on our farm land, to pay the 20 per cent land transfer tax and still have a chunk of property that is going to make them a pretty nice profit some time in the future.
We are certainly going to support this bill, and do hope it is one step forward in bringing about some measure of control over the foreign ownership of farm land in Ontario.
When we go into committee, we will be proposing a registry that, in addition to what is now law, would enable us actually to find out who is buying this land. This has been one of the major problems over a lengthy period of time: we are left without resources to know what is actually happening.
The member for Huron-Middlesex this afternoon laid out his personal estimate of how much land is in foreign ownership and how active the people from offshore are in buying up prime farm land or any kind of farm land in Ontario, but the unfortunate truth is that we really do not know. We have seen a couple of attempts at this; we have seen some sets of numbers put out by the Minister of Agriculture and Food. But one has to question how accurate it is when someone says that only one per cent of farm land is in foreign ownership. One also has to look at the way those estimates were made.
Part of our difficulty here is that we appear to be in the same boat as every other province in the country and we appear to be out of sync with many of them, where an eloquent argument has been made that farm land in particular ought to be retained in the hands of Canadians. Of course, in other jurisdictions we have seen governments, sometimes of the same political stripe, show a marked difference in their approach to trying to retain the ownership of farm land in Canadian hands.
We sometimes have difficulty with this government because it does tend to obfuscate issues and confuse them as best it can and to put forth conflicting sets of numbers; so in Ontario it is difficult to answer the very basic question of who is buying up the farm land. It is difficult from a number of points of view: people do not have to declare where their interests are; people can buy it through a number of devices that allow them to be anonymous.
The word in the rural community, of course, is quite different from that. It is one thing to have the Minister of Agriculture and Food say, "There really is not much going on there. It is marginal: It is one per cent," and then to look at the numbers and see that it is 150,000 acres. But in the rural community there is at least a perception that farm lands are going out of the hands of Canadians on a large scale.
It is important to look at the history of this country and to recognize that we should have learned our lesson from other parts of the development of Canada. In many places the resources of this nation were sold out long ago to other interests, and rather than have an ideological argument about whether that is good or bad, I think we ought to look at the practical aspects of it and be very pragmatic and say this nation can no longer afford to sell off its resources to people who are not Canadian.
In other fields we have seen attempts to recover them and to say we ought to Canadianize sectors of our economy. We have also seen in other fields and other resources -- in our woodlands, energy resources and fisheries, where it is very difficult once that initial transaction has taken place -- once we have lost control of those resources it is very difficult and expensive to try to get them back. The best view, at least the one I support, is a very pragmatic point of view. That is, we should not allow it to happen in the first place.
When we look at the numerous articles in Canada, the United States and in other parts of the world that have been written about what happens to a nation whose food supply is out of its control, one begins to get an idea of how dangerous it is to allow something as basic as food commodities, the food we eat, the food that feeds a nation to get into another realm; that is, the whole realm of speculation and international manipulation.
The case for retaining farm land in Canadian hands is one which cannot be denied. Whether or not this particular act will really do a great deal in that regard is open to some question. We support the bill because it plugs an obvious problem. It is worthy of support on that basis, However, it is somewhat ironic that it is the Minister of Revenue (Mr. Ashe) who is making this proposal to the House and not the Minister of Agriculture and Food (Mr. Timbrell) or some minister who is responsible for the resources of this province.
It is rather unfortunate, but true, that what makes this government act is the jingle of the coin. When it senses it can grab a little more tax money, it actually does something from time to time.
I wanted to raise with members the problem of putting an amendment which would make this bill retroactive. We would support such an amendment and we had considered it. In the traditional sense of a tax bill, it would be a no-no for an opposition party to move such an amendment because it is a tax bill and part of the budget. Traditionally, opposition members can move amendments to such bills but not over money matters. It was our judgement that this would clearly fall within that purview and that the chair would rule such an amendment out of order if it were proposed from this side of the House.
With mixed feelings on the government side, one might even hear this is a matter of confidence and we had better have an election over it, not that we would mind that in particular. I have not had an election in the last year or so and I am getting a little anxious to get out there again, but I certainly would not want to stumble into it. I would like to know that we are doing that full tilt. We would support the concept of having some retroactivity in this.
There was a difficulty here. I notice the member for Huron-Middlesex (Mr. Riddell) had a problem with this as well. When we say we want this bill to be retroactive, are we talking about the first day the world saw this particular Bill 14 amendment or the same proposal in a previous incarnation, which I believe was just in December, or I thought I heard him say that one might want to even want to go further back than that? If we are to proceed with an amendment which makes it retroactive, we had better get our language clear as to which amendment to which bill we are talking about. If we can do that, I think that is supportable.
Again, we will support the bill. We do think it covers one part of a very large problem. Once again I want to put on the record the lament which I am sure many members would like to put on the record if they had a chance, and that is that it does not go far enough. It does not cover the major problem which has caused immense difficulties in the development of a Canadian economy, which is the loss of our own resources, particularly farm land and the problems that are related to absentee landlords.
I do not think we would have to look very far in the history of the world to discover that very quickly becomes a major difficulty for anybody's economy. This bill does not go that far. It does not resolve that particular problem. It does put a little more coin into the Minister of Revenue's pocket and since his pocket is now located in Oshawa, I am pleased to support that.
I feel that opposition members think they are the only ones who should criticize lack of legislation and I would like to just stand up and say that I would like to see this go through because it represents a real problem in my riding.
There is just one area of concern I can see us drifting into if we move along and take the second step whenever that may be necessary. I think the member for Waterloo North (Mr. Epp) should address this in his private member's bill which pertains to enshrining property rights into the Constitution, but that is for another day.
The member for Huron-Middlesex takes credit for his private members bill pertaining to registration of farm land sold to absentee foreigners. I would just mention that I seconded the bill introduced by the member for Middlesex (Mr. Eaton) about three years ago on this same problem, basically requiring the registration of land purchased by absentee foreigners. That bill, I am pleased to say, was brought in by the government a couple of years ago and it is legislation we now have in existence.
I would like to congratulate the minister in bringing this bill forward with the hope it will block one of the loopholes now in existence. I am concerned about the potential threat of this advancing into the rural areas, since, as some of the members have mentioned, it will likely escalate in view of the depressed farm prices.
I will not debate the merits of foreign ownership, if there are benefits, but I would like to mention something pertaining to this bill. In my riding of Wellington-Dufferin-Peel one individual, Hans Eilers, has purchased, controls or somehow owns 23 farms filling 2,190 acres in two counties, Wellington and Dufferin. One individual has bought out 23 farm families and now owns well over 2,000 acres.
In the township of East Luther, Dufferin county, Zentra Investments Ltd., controlled by Hans Eilers, has purchased 1,320 acres, seven farms; in the township of East Garafraxa, Dufferin county, the same company, Hans Eilers: 224 acres; in the township of West Garafraxa the company changes to Eurozentra, which is in some way controlled by Hans Eilers; in the township of Eramosa, the same company, same individual: four farms, 626 acres.
We move on to the same township and a new company by the name of Merlo Farms Ltd., owned by Hans Eilers: two farms, 391 acres; in the township of Pilkington, Merlo Farms Ltd., Hans Eilers: one farm, 225 acres; the township of Nichol, Merlo Farms Ltd., Hans Eilers: one farm, 107 acres.
There are three companies, with one person listed. I have not been able to determine who he is, what country he is from or what group of people he represents. There is a concern; we should know. I do not know how much land is going out of production and I do not think anybody does know; I do not think we can determine that until we find out who these individuals are and what company or country they represent. Indeed, they might be Canadian; but frankly I doubt it.
In the township of West Luther, 14 farms were sold -- a total of 2,190 acres -- to different people, not the same company. These are not the totals of all farm lands sold to known purchasers, but they certainly highlight the concern of the people in my riding.
As I mentioned earlier, I do not want to get into the pros and cons of absentee ownership -- that is another issue which will take a long time to discuss -- if indeed there are any benefits. I feel all members of this Legislature are vitally interested in knowing who is purchasing our farm land: I do hope they will support the legislation and make it as strong as possible so that we can determine the owners and make the next assessment.
So I say to my colleague, without wanting to be offensive to him -- he is a member of the same party and if he wants to remain friends with the Minister of Revenue he cannot say those things -- that I am sure as I look at his smile he agrees in some way with what I am saying this afternoon.
My colleague the member for Huron-Middlesex explained the problem with his usual vim and vigour. I want to talk about two aspects of this legislation which show how incompetent and irresponsible the Minister of Revenue and the government are in bringing forward this legislation. I am looking at the minister's smile; I think he knows he sort of botched this whole process. He has known about the loophole for five years and has closed his eyes to it, in spite of the prodding and the evidence brought forward by my colleagues in this assembly.
For five years, it has been as though he wanted this loophole to continue. He appeared not to mind seeing people use a legal mechanism to get around legislation which was there, I understand, for a purpose. Even as he tries to close the loophole, it is just as though he is saying to his friends, or to people trying to circumvent the legislation: "Look, we are coming forward with this legislation. You had better hurry up and take one last fling with this because, folks, we are going to close the loophole when this legislation gets royal assent."
I have never seen a case which does not appreciate that people may try to take advantage of the process or of the problem the government is trying to eliminate in introducing a tax measure. That is why, when tax legislation is brought forward, the Treasurer (Mr. F. S. Miller) gets up in the House and says, "As of tonight there will be an additional sales tax on such-and-such a product." He tries to make the announcement at a time that will prevent people from taking advantage of the measure to gain financial enrichment.
Of course, that is the purpose of preventing leaks in the budget -- to prevent people from taking advantage of it. Knowing the loophole existed and that people were taking advantage of it, the government proceeded to bring forward legislation. Section 12 of Bill 14 states, "This act comes into force on the day it receives royal assent." I say it is irresponsible of the minister to stand there, as he did today during question period, and tell my colleagues and the colleagues in the third party, "I am anxious to hear your views on retroactivity and I am anxious to hear your views on bringing forward amendments."
As my colleague the member for Huron-Middlesex indicated, and rightly so, it is against the standing orders of this assembly to even think about bringing forward amendments which may amend this tax bill. Because clearly, that is what it is.
I have no doubt that if you were asked to rule, Mr. Speaker, if one of us brought forward an amendment, you would bring to our attention standing order 15, which states: "Any bill, resolution, motion or address, the passage of which would impose a tax or specifically direct the allocation of public funds, shall not be passed by the House unless recommended by a message from the Lieutenant Governor, and shall be proposed only by a minister of the crown."
So we cannot even propose the amendment. Yet the minister, whom one would think would know better, was talking to us, telling us, as my colleague has pointed out, "Bring forward an amendment, I would like to consider it; I would like to hear your views." We cannot even do that, Mr. Speaker, because you would rule it out of order and we could not do it. I think it is pretty irresponsible on the part of the minister to even suggest that procedure is open to us.
The second point, and probably more serious, is that the minister says: "I am anxious to hear your views about people who are trying to speed up, accelerate transactions to avoid the imposition of this or to avoid the closing of a loophole by Bill 14. I am anxious to hear your views on this." What was that?
With this legislation, the minister has invited people to try to accelerate transactions to avoid the bill. What he is saying to them now is simply this: "If any of you people out there have wheeled and dealed in the last while to do something which is at this time perfectly legal" -- they are not doing anything illegal; the minister has admitted it is a loophole so there is nothing illegal -- "we may go back and tell you what you did today or yesterday" -- my colleagues from the NDP were talking about going back to December -- "which was legal at the time you did it, is now illegal and you are going to have to pay the tax."
Does the minister not understand what my colleague the member for Huron-Middlesex is talking about is that we would support the retroactive principle in the original bill? Had the bill said, "This bill comes into force on the day it is brought forward," for instance, April 21, 1983, and then it was not passed for two months, we would understand that because then people are on notice. But for the minister to stand here and say to people who have transacted legally, people who have done nothing wrong, acting according to law, to tell them two months later or a month later or whatever time later that they are going to have to pay a tax on this transaction is simply not permissible.
There is now a Charter of Rights -- this government supported it -- and I suggest that is not permissible under the Charter of Rights. There are two sections of that charter which I suggest are applicable here. The first section is section 12, which states very simply that everyone has a right not to be subjected to any cruel or unusual treatment or punishment.
I am saying people who transacted legally entered into a contract. My colleague the member for Burlington South (Mr. Kerr), the former Solicitor General, who I am sure if he looked back at the law books, would agree with me. People get into a contract; what they did was legal. They thought it was permissible and that they would have a good argument before the courts. But what happens if we impose an extra 20 per cent is unusual treatment.
I am convinced a judge would overturn this legislation pursuant to the charter, and if the minister is considering bringing in something that is retroactive, he may be asking for it. I know the legal fee does not come out of his pocket, but he is going to end up in the courts and he is going to have this legislation delayed.
The minister knows what happened the last time the Attorney General (Mr. McMurtry) represented this government in the Supreme Court: nine-zip against. We told him before he went up there. The record with you sitting next to him in the Supreme Court would be just as bad, George; it would be no better.
The second thing is, if there are penalties or remedies in the legislation -- confiscation, garnishment or whatever -- they may well be unenforceable. Mr. Speaker, you are familiar with subsection 11(g) of the charter, which says that people cannot be found guilty of an offence that did not exist at the time it was committed. This is why the provisions of this statute may not be enforceable. In other words, what we call the penalty provisions of the statute may not be --
I am extremely pleased. Some of the New Democratic Party even understand some of the things I am saying here, and it is very encouraging for me this afternoon.
My colleague understands that most legislation has penalties to make sure that people follow its provisions, and if he tried to enforce the penalty provisions of this section people might well make an argument that the penalty the government is trying to impose did not exist at the time the contract was concluded and therefore offends section 11 of the charter.
Does the minister want to open up this can of worms? He has botched it up badly enough the way it is. Maybe he knows all these things, and one suspects this is what he wanted anyway: to give his friends one last fling to wheel and deal before this legislation becomes law.
But if the minister is thinking about bringing forward retroactive provisions to catch the transactions that have been going on for the last month or two months or the last year, I am sure he will find his legislation before the courts. I would bet some money -- not much money, because I am not a gambling person -- that the courts would look very harshly upon a minister of the crown who would tolerate a situation for five years, would bring forward legislation saying, "This act comes into force the day it receives royal assent," and then, in the middle of reading the bill, would turn around and say, "Now this act comes into force as of November 1982."
I think the courts would look very harshly on that type of conduct, because these people would be before the courts and would say, "Look, we concluded a valid transaction."
I notice from his smile that my colleague from Cochrane understands this. He is a business person. When you make a deal, you make a deal.
I want to alert the minister and the members of the House that I am offended, as are my colleagues in this party, that there were no retroactive provisions originally. I cannot understand why this bill, like much of the legislation that has been brought in and that the minister has supported, had no provision saying, "The law comes into force as of May 11" as in most of these taxing bills. Why did he not do the same thing with this legislation, knowing full well people would try to take advantage of it?
The minister should reconsider what he has been telling the opposition in the past few hours, that we should bring in such amendments when we cannot and that he is considering bringing in such amendments, knowing there are serious legal problems in so doing.
My colleague the member for Huron-Middlesex (Mr. Riddell) said it well when he said the government's action in this whole process has been a comedy of errors. If the minister is trying to correct a situation, which in my opinion is legally not correctable now, he should not compound it any more than he already has. He should try to live with his mistakes. We understand, and we hope the people of Ontario will judge him for what he is the next time he tries to get a mandate.
If one looks at the explanatory note, it says, "The bill deems a taxable disposition of land to occur where a corporation or trust which owns agricultural land in Ontario becomes nonresident."
My friend the member for Mississauga South (Mr. Kennedy) and I went through the experience of trying to find out who owned what. We had three full days of all the developers coming before us.
It was interesting that what happened throughout that whole exercise illustrated what is wrong with all our approaches to land: how we are going to tell who owns what. As a select committee, we tried for days and days to find out. We brought the land developers before us and, as my friend well knows, at the end of three days, just dealing with that small group, we were no further ahead as to who owned what, where, and what they were using it for, than we were before they entered the scene.
If the minister likes, I will just quote an extract from the select committee report. "It is apparent that the pressure of economic and social development in the province, accentuated by social trends and environmental concerns, makes the development of appropriate land-use policies a major challenge for the 1970s."
Obviously the government has not as yet adopted anything with respect to that difficulty, because we have one cabinet minister who is trying to get some land-use policy, and there are the Minister of Northern Affairs (Mr. Bernier) and the Provincial Secretary for Resources Development (Mr. Henderson) running interference for those people who do not want it. This report, which is now almost 10 years old, had the endorsement of at least four people who got to the cabinet: the former Mr. Speaker Rowe; Sidney B. Handleman; the member for Mississauga South (Mr. Kennedy), a parliamentary assistant; the member for York West (Mr. Leluk), who happens to be in the cabinet as Minister of Correctional Services; William Newman, who got to the cabinet; and the member for London South (Mr. Walker), who is now in the cabinet as Minister of Industry and Trade.
We recognized then, when we were trying to assess who owned how much agricultural land, that it was impossible to determine. We tried to look at who owned recreational land, and I defy any of the people under the gallery who happen to be with the minister's staff to come in and tell us how they have sorted that out; to tell us if they could what the land is used for and who owns it, in all categories; they could not.
One of the reasons my colleague will move an amendment to have a land registry is because, unless we get to the root of the problem, which is to determine who owns the land, everything else is for naught. Having spent a lot of time in that select committee, I know that obviously there are all kinds of ways to play little games.
We make the statement here that it is impossible to determine what the land is used for. We had research staff. The report says: "The committee confronted some complexity in examining various categories of ownership and use. In particular, it is often exceedingly difficult to distinguish what are purely residential uses from recreational uses, and the latter from agricultural uses.
"In the commercial arena, speculative investment in land may, for example, be difficult to distinguish from land assembly for desired housing and development." Has any of that been sorted out? I do not think so. That tells us that we, as a select committee, had research staff trying to figure out who owned what. We brought in the developers and they left us somewhat cold because obviously they were determined not to indicate specifically who owned the land they were talking about.
If we cannot distinguish what is being used for agricultural purposes or what is being used for recreational purposes from what is a commercial endeavour, I do not know what this bill is going to achieve, outside of getting a few bucks. It might resolve that problem, but it will not even start to deal with what the select committee recommended with respect to land-use planning and, in particular, land use with respect to ownership.
It might be interesting for the minister to know that if one looks at Ontario, southern Ontario in particular, as it sits in the heartland of the industrial USA, there are 100 million people within 100 miles of our border. At a time when our dollar is devalued, it is to their advantage to buy. We said back then, when certainly there was no 20 per cent difference: "For other reasons too, Ontario and Canada have been attractive places to buy land. For real estate in general, from a general business standpoint, Ontario has been and is a desirable place to establish business operations.
"Further, particularly in or near urban regions, investment in real estate in Ontario has been attractive to both foreign and domestic investors. In particular, British, other European and Japanese investors, encouraged by substantial upward re-evaluation of their currency relative to the Canadian dollar, are active participants in Ontario real estate markets."
I could not help but listen to my friend the member for Wellington-Dufferin-Peel (Mr. J. M. Johnson) as he indicated the number of properties owned by one or two individuals. That concern was before the select committee in 1973-74 when in the Haliburton region some German corporations, I am told, acquired almost half the county. It was one of the reasons the select committee tried to get a handle on who owned what. Ten years later the member for Dufferin-Simcoe (Mr. McCague) has a serious problem because large tracts are being bought in a part of his constituency.
With a 20-per cent differential today between our dollar and that of the United States and with 100 million Americans very close to our borders, it becomes a lucrative operation for them. The same applies to people from Germany who want to invest and with what we understood at the time were special tax laws for buying land in Canada. It becomes a very lucrative operation for the Germans or for the Americans. I cannot say it is so lucrative for Canadians, however.
That was why the select committee finally came to the conclusion that only Canadians and landed immigrants should own land. Some of us went further, and managed to get the committee convinced. If one goes down to Lake Erie, I am told, one cannot find a piece of recreational land that is not blocked off and does not belong to the Americans.
Does it make us anti-American when we say that land should only be sold to Canadians for recreational purposes? I do not think so. What we attempted to do at the select committee was prevent that from occurring any further with recreational land. And certainly with agricultural land it is imperative.
My friend takes most of the credit for this, but long before he even entered the Legislature Stephen Lewis was speaking about land ownership. I do not want to detract from what my friend has done; I give him full credit for that. I just want to keep it in perspective that the question of land was the major theme in a number of elections.
I cannot help but admire my friend across the floor for bringing in what he did. In fact, one of his colleagues, the member for Timiskaming (Mr. Havrot), brought in a resolution on the subject a couple of years ago. All the Tories jumped on it and pounded their bloody desks and said it was magnificent. Then the government went out and started to sell recreational land again, despite the resolution from the member for Timiskaming to the contrary. So we go on our way and now we are selling land again.
As I say, there is the Minister of Natural Resources trying to protect land, the member for Dufferin-Simcoe and the member for Timiskaming also trying to do it, yet this government fails to deal with it. What the hell is it going to do? Wait until the land is all gone or until it is totally in foreign hands before it acts on any of the recommendations of any committee?
They bring in something that is going to plug a little loophole but they have not even got in there how they are going to identify who has the land. Maybe the minister can tell me, when he responds, how he is going to identify who owns the land and the use to which it is being dedicated. We could not find out and unless he has a whole new battery of people doing it now, I guarantee he cannot do it. Neither can his staff nor could that of the former Minister of Natural Resources.
The select committee brought his people in to try to get a picture of what was going on in the province. They did not know. Maybe the Minister of Natural Resources can tell me about the use of all that land. That ministry has categorized all the land across the province that comes under them directly as to its use. I suspect he cannot and I am certain he has even less of a handle on it where it is under private ownership. That is why, when the member for Huron-Middlesex gets up, he has to talk in generalities. There is no real registry that tells us where the land is, who owns it and what type of land it is. Surely that is the basis we start from.
The government has had 10 years. My friend said it acted within five. To plug the little loopholes took five years; I do not know when it is going to get serious. Maybe the minister can tell me that all those red Tories on that select committee were off their nut or had fallen out of a tree. I suggest members read some of their dissents and they will find out they were not.
I well recall dealing with the former Minister of Agriculture and Food. We had it within an ace at the committee that we would only lease land for every reason in the province, commercial, the whole schmeer, until Billy came in. He had read the recommendation which had been approved, by and large. Those of us who knew Bill Newman well saw he just blew his cool. He was beside himself with how far that recommendation had gone.
It indicates those of us who spent a lot of time looking at this found we did not have any answers. We found we did not know who owned what; we did not know the reasons. We also found there are so many Americans so close to us and so many reasons why other countries are encouraging people to invest in Canada, such as for speculative and tax write-off purposes -- you name it, that some day we will simply have to protect our land.
Other provinces have moved into it. I read about the recent objection of Prince Edward Island to the thrust of the great debate in Ottawa. Prince Edward Island recognized a long time ago it had to protect land. One can say it is much smaller than Ontario but that is not what triggered that. They did it to protect that good agricultural land for its own people.
Some time ago, Saskatchewan also decided it was time to protect itself. Even in British Columbia, where they said they were going to change the legislation on land after Barrett was defeated, they did not alter that either because they realized that with a limited amount of agricultural land in British Columbia they could not afford to see good agricultural land being ploughed under for yet another development.
I often make the case that I cannot understand why there is no secondary industry in northern Ontario. One cannot grow much on the rock pile, but I see good agricultural land --
To see good prime agricultural land being ploughed under for yet another development is crazy. That was at the nub of why we could not get information on who owned what land from Wimpey and the various companies who appeared before the select committee. They had a lot of land taken around Toronto and in the east. They did not want to tell us who owned it. They kept saying, "We do not know who owns it." Yet they knew full well.
The government is going to have to get serious. We are going to support this. I hope the minister is prepared to accept our amendment on a registry because that will be a very important move to determine who owns what and the use to which it is put.
"Information: The committee recommends that the government prepare and publish on an annual basis detailed ownership and residence data by region and use for land owned both by individuals and corporations in the province.
"The committee further recommends that such data be developed in a manner that will generally support and facilitate the ongoing analysis of behaviour and performance of real estate markets and institutions in Ontario."
That was recommended eight or nine years ago. Even though some of the minister's colleagues dissented from some of this report, I looked it over and could not recall that any of them opposed that recommendation.
It seems to be imperative that we start. I hope the minister in his remarks will not rule it out out of hand based on the select committee report. I am sure he will get backing for this very important recommendation from the Minister of Industry and Trade, the Minister of Correctional Services and the member for Mississauga South, his parliamentary assistant.
The reason suggested is that we simply did not know and I do not think we know even today. If we want to get a handle on it, this is the place to start. It is long overdue; it was recommended 10 years ago. Surely the government is prepared to go at least that far to find out what is going on in Ontario, who owns the land and the use to which it is being put. I would urge the minister to be prepared to accept the land registry concept.
My colleague the member for Huron-Middlesex indicated he gave warning of this particular loophole five years ago. While it might not have been unreasonable for the minister or his predecessor not to accept the recommendation that very day, I believe the minister and his staff must be subject to some real criticism for having accepted that the loophole existed and could be reasonably and easily closed, yet still delayed bringing the corrective legislation forward.
The minister must be aware, even more than we are, that during this period of delay a number of transactions have taken place. There have almost been fire sale prices as the people who are selling the land, the legal advisers or agents for the vendors, have tried to move the land before the loophole was closed by this House.
The minister is asking our advice about a retroactive amendment. I believe my colleague, our agriculture critic, has indicated we would support such an amendment; although my colleague the member for Ottawa East (Mr. Roy) has said he does not believe such an amendment would be legal.
It is clearly up to the minister to bring forward an amendment that would be in order in this House to begin with. He must be able to convince opposition members as well as his own colleagues, perhaps just as tough a job, that such an amendment establishing retroactivity, which was not established at the introduction of the bill, does not fly in the face of the Constitution of our country.
The minister would surely beware of getting himself embroiled in a legal controversy that might take many months or years to settle. Frankly, I do not think he can do it. I am very disappointed that the minister did not take the initiative, or his advisers in and out of government did not so advise him. We could have proceeded with this legislation last fall or earlier this winter, before this great flurry of land transactions actually started to occur.
I want to say something else about the bill. I am sure the minister is aware that while everybody in this province wants the land preserved from foreign ownership, there are many farmers who have seen the value of their land drop dramatically and have been very glad indeed that somebody from outside the country had the cash to pay for it.
Not a mile from my farm is one of the finest orchards anywhere. It was sold by an old family in South Dumfries township to foreign ownership. They have stayed on with some responsibility for management until the foreign owners want to change that management or perhaps take up occupation themselves.
I can assure you, Mr. Speaker, there is no objection whatsoever to people buying the land who are going to come to Canada and farm it. Good heavens, it would be ridiculous to have any objection since all of us are, related to certain benchmarks, very latecomers indeed. Only my constituents in the Six Nations reserve have any claim to be original citizens, and even they have been here for only 200 years from what is now New York state.
The farmers in my area, myself included, have seen the expected value of their farms drop from perhaps $2,000 an acre to around $800, if one can get somebody to buy it. There are good farms for sale in the area, almost at fire sale prices, because of the heavy economic pressures some of the owners and operators have been subjected to in recent months and the past two years. They and their banks would be very glad if they could sell it to somebody to get out from under the debt load, which they find unbearable.
It is generally accepted that we want to do what we can to keep our farms in resident ownership. This does not exclude anybody anywhere in the world who can come to Canada, buy the property, farm it and become a part of our Canadian community. Obviously, that has been a part of our strength right across the province, and as much in the farming community, or more so really, than anywhere else.
It offends me that we have in this very strong legislation -- imposing an additional tax of 20 per cent on foreign ownership -- excluded so much of our valuable property. It was just last fall that we were completely concerned in this Legislature with the sale of most of the best apartments in Metropolitan Toronto to Arab interests. At least that was what the minister told us the disposition of the sale was. One can see that if the law applied to a sale like that, if one is going to sell $500 million worth of apartments to Arabs, they would owe us $100 million in land transfer tax.
Probably it is a shame the law does not apply to them. When it comes to foreign ownership of our resources, there are those of us who feel it is a shame somebody who is completely disinterested in our community owns the largest number of our best apartments. What is so great about that? Yet these are excluded from the bill.
If one wants to talk about retroactivity, Mr. Speaker, you may well recall -- since your interest in politics goes back to the days when you were nothing but a child -- when a company based in Switzerland came over here with nothing but a little line of credit in one of the local banks and made a contribution of $50,000 to the provincial Progressive Conservative Party. It has established itself as one of the largest land owners in Metropolitan Toronto -- Fidinam (Ontario) Ltd.
As a newcoming company not encumbered by any of these punitive taxes, it was able to work out a deal with the Ontario government to build them a new headquarters for the Workmen's Compensation Board; and they are still leasing it to them, for heaven's sake.
It is rather unfair that only the poor farmers are having to pay the price to maintain the ownership of our land in nonforeign hands. I just wanted to point that out, because when one looks at the reams and reams of explanatory notes here, one sees that pretty nearly everyone is excluded from paying this tax or being subjected to the closing of the loophole except the farmers, and only a few of them at that.
Section 10 releases from any responsibility any nonresident person acquiring land for development or resale. That is all right, if one can make a profit on it. There is at least a portion of deferral for land that is being acquired for use by the developer for residential, commercial or industrial purposes. That is all right. But if one is going to go out, spread manure, work the ground and hoe the turnips or whatever they do in that part of the world, then there is an additional 20 per cent tax that has a very serious effect upon the farmer's enjoyment of his own property and his opportunity to make a profit out of it.
I personally would like to see the concept of the bill applied right across the board so that we are going to see that our important resources, our property and our real estate, is going to be owned and controlled by residents and not owned and controlled by people in far-off lands.
It is interesting that in the one case of a farm which I have already described near me the new owners are West Germans. Although I have not spoken to them personally -- I have not met them, and I am not even sure they were here -- the local story is they are farmers where they now live and their feeling is that the land at the price we are charging here, even with the 20 per cent tax, is still a great bargain. They also feel that, God forbid, in the unlikely event that the SS-20s, or whatever it is we are concerned about, start arching over the international boundary and they want to go somewhere else, there could not possibly be a better place in the world than here.
That sounds like weird thinking, but obviously our land is very much underpriced in the eyes of people with some kind of world view and that is why this pressure is brought to bear.
I can assure members that farmers have spoken to me who certainly do not want the land in our province owned by so-called foreigners but who also are very anxious to make a profit on their land whenever they properly can. They are not at all as enthused as everybody in this House is with the provisions that restrict them from making that profit.
I have supported the bill and continue to do so, but I do believe these restrictions ought to be on a much broader basis in this province and not just directed against the group that so many people in this House look at from a distance and so romantically, the farmers and our productive land.
I recognize that the bill likely will go a long way towards plugging the loophole, which as the member for Huron-Middlesex (Mr. Riddell) has said has lost the government perhaps some $40 million in revenue that it could have had; but it may not entirely plug that loophole.
I suspect the government has brought in this bill with a great deal of reluctance. It is not like this government to bring in legislation that inhibits the speculators, whether they are foreign or local. I do not think it is any accident that it has taken them five years to do it. The only reason we have this legislation before us now is that it has become a bit of an embarrassment to them. The public out there are getting to know that this loophole exists.
Therefore, when it comes to the case of losing some additional votes, as they think they will, or moving against this loophole which their friends have been able to use for quite a period of time, they take the path of what they think is not only the least resistance but also of benefit to them politically in the long run and have brought in this bill which we have before us.
I am unenthusiastic about this legislation, despite the fact that it has been billed as being a bill that will help to preserve our prime agricultural land in this province; that it will inhibit, to some extent at least, the sale of our agricultural land to nonresidents and therefore we will be able to preserve more of it in agriculture and have control over more of it. Although it will obviously have some effect on this, I suggest the effect will be very slight.
The member for Brant-Oxford-Norfolk (Mr. Nixon) has mentioned that the price of farm land has dropped so dramatically in the past couple of years, particularly within the past year, that they can pay this 20 per cent tax they are now going to have to pay and still be able to buy this land for 50 or 75 per cent of what they would have paid for it two years ago. It will have very little effect on inhibiting sales.
If the government wanted legislation that was going to preserve agricultural land from nonresidents, that is the kind of legislation that should have been brought before this house.
Of course, we need to plug this loophole, but this in itself is not going to provide the answer that we, at least in the New Democratic Party, would like to see; and that is legislation that would provide much more for the preservation of our prime agricultural land.
I am not at all sure that even the Liberal Party is tremendously interested in preserving our prime agricultural land.
Perhaps you will know, Mr. Speaker, even though the members may not -- although they know too -- that the loss of our prime agricultural land to urban encroachment has been many times what it has been to nonresident ownership --
There was an article in the St. Catharines Standard recently with regard to what has taken place there since the urban boundaries were set. The heading is "Regardless of Strict Policies, Region is Still Allowing Severances." I am now going to quote a very small amount from the article.
"At one point in a lengthy Ontario Municipal Board hearing three years ago into Niagara region's urban boundaries, the hearing officers asked how long the policies being debated would remain in force. `Until they are changed,' replied regional planner Alan Veale. `Pardon?' `The best professional opinion I can offer is until they are changed.' There were snickers through the gallery of lawyers, preservationists and individuals who had a keen interest in the boundaries and policies set. The two hearing officers sat silent for a moment, dumfounded by the reply.
"The hearing that would establish the region's policy plan, a plan to control urban growth and protect the farm lands, was approaching two years, one of the longest in Ontario. It was an exhaustive hearing, involving hundreds of witnesses and briefs. Municipalities, land owners and interest groups spent millions of dollars on their defences and these boundaries were to remain until they were changed."
The boundaries have been changed something like 32 times since they were established in 1981, the biggest and the last being at the behest of the Minister of Municipal Affairs and Housing (Mr. Bennett), who would not even refer it to the Ontario Municipal Board for a hearing.
When I see legislation like we had before, of five years with regard to nonresident ownership and this tax, and when I see the changes that are being made in it now with the thought that somehow or other this is going to prevent nonresident ownership by a government that does not believe in interfering to preserve our prime agricultural land, then perhaps I will be excused for being cynical about all of these measures.
In Niagara, the Ontario Municipal Board said these boundaries were to be considered permanent, but it has been proved that if a government or a regional municipality does not care about the preservation of our prime agricultural land, we can have all the laws in the world and they do not mean a thing. They will break them willy-nilly.
We have a government now bringing before us another piece of legislation that is supposed to plug a loophole. We have a government that once again does not really believe in the principle of what it is doing but is only doing it under pressure, it is not going to change a thing in the pattern of foreign ownership of our prime agricultural land.
As I said in the beginning, if the government were really sincere it would have brought in legislation that would not permit nonresident ownership of our land. As pointed out by other members, this has been done in at least two other provinces.
If the government were sincere about preserving our prime agricultural land, it would ensure that after hearings took place -- such as in Niagara, where they were the longest and costliest in the history of Ontario -- the decision would be upheld, instead of being broken at every opportunity.
This bill means nothing unless we have a government that is sincere in preserving our land. This government is not interested; so this bill, therefore, will not mean anything.
He started out by saying he supported the contents of the bill; it was going to bring in some equality in tax matters in Ontario. Then he summed it up and talked about the Preservation of Agricultural Lands Society and the preservation of land in the Niagara region. He thought he was going to have some difficulty with the bill.
If we go back to the early history in Ontario. section 46 of the Public Lands Act in 1860, which came under the Minister of Revenue at that time, repealed former legislation which said nonresidents and owners in Ontario and Canada would have to take an oath of allegiance to the King or Queen and to the country. Well, much of the choice recreational land in the province has gone to nonresidents.
On Decoration Day, which will be coming along in a number of municipalities within Erie riding, one sees the veterans who have fought for this land and for access to certain recreationai areas in Ontario, particularly along the shores of Lake Erie. We do have fences in the area where, over the years, land had been given to nonresidents. It was given to them for a song and dance. Today, the patent of that land has not been given back to the crown, which was the original intent. Much of the lakeshore in that area was farm land that provided limestone, sand and gravel to build the city of Buffalo. Those patents, given at that time, for the rights to remove sand and gravel, have never come back to the crown. Perhaps the patents followed to the new owners.
I wanted to draw that to the minister's attention. If we are thinking about legislation, from some of the comments this afternoon perhaps that is what we should be looking at. If we are talking about patriotism in Ontario and Canada, there should be allegiance given to the crown, or to Canada, as it relates to obtaining property. The bill itself does not protect us one bit from that.
We can see that by applying the 20 per cent land transfer tax it does provide some protective measure, but it is the nonresident owner who can come back five years down the road, as I interpret this bill, and remove it from choice agricultural land back into commercial, residential or recreational land development, from which he can reap huge profits with the minister's consent at the expense of a number of taxpayers and the Legislature.
I was interested in the comments of the member for Welland-Thorold when he talked about the preservation of agricultural land in the Niagara Peninsula. I was deeply concerned about it, and I still am. I have heard him make speeches in his days on Welland county council and talk about planning. The way to go about controlling lands, who shall buy them and who shall own them, was through planning, restricted-area bylaws and so on. Under his leadership as reeve of Thorold township I can think of some of the choice farm lands that disappeared. It will be on the records anyway.
In fact, June 4 this year will be the official opening of the municipality of Niagara. The council headquarters and administration building are on St. David's Road -- that is the road just above the escarpment of the Niagara Peninsula -- on choice agricultural land, now located in the city of Thorold, which was the township of Thorold. I suppose when I get thinking about it he will be right in his glory that day, standing up there on the platform taking credit as the godfather of regional government in Niagara.
I just thought members should be aware of that. In fact, I think we have one of the finest provincial detention centres located in the former township of Thorold.
But getting back to the principle of this bill, and I thought the Speaker would want me to do that, I suggest that perhaps it does not go far enough and, like other members, I do have some reservations about it. It does not control the ownership of the agricultural lands in Ontario, and that is what we should be more concerned about. For example, I have the problem in my area, where we have foreign ownership of some good farm lands in Fort Erie, that even the farm tax rebate does not go back to the person who is renting the land; it goes directly to the owner, and I suppose he is over in Germany.
So there are many loopholes yet that should be plugged, and perhaps it does not go quite far enough. I suggest that the minister responsible should consider making it retroactive so we can plug those loopholes further. He has got what -- three weeks, four weeks, five weeks; it could be a year before he proclaims this bill; and what does he accomplish by not making it retroactive?
I want to comment on one of the townships that is hardest hit by this phenomenon known in our area as foreign ownership, and that is Morris township. It is my home township. I was raised there and I can remember very well not very many years ago -- in fact, five, six, seven years ago -- when one could go down the concession roads and find any number of families occupying large and well-kept farm homes with very large and functional farm outbuildings.
Now you go down some concessions in Morris township -- the fourth concession and some places on the fifth and the sixth concession -- and you can go past farm lot after farm lot where the house has gone into disuse and the farm buildings are no longer kept in repair. In some situations the farm house has been taken down or has been burned so that the people do not have to pay the assessment on those buildings.
It is not uncommon for the people in the rural areas of southwestern Ontario to notice a migration of people from the rural area to feed the hungry labour markets of the urban centres. That has happened for years and it will no doubt continue to happen for a number of years to come. However, this phenomenon known as foreign ownership has speeded up that whole process because there is no place for the young rural person to look for a market for land.
I know a good number of farmers who sold to those nonresident people would have gladly sold -- for perhaps somewhat less than they took from the foreign owner -- to a person they saw growing up in the community. They would have preferred to sell to someone they knew would be a good farming prospect for the agricultural community in Ontario.
They would have sacrificed some of those extra dollars in interest for their retirement to see a person take over who grew up next door or who went to school down the road. They would have preferred someone who would re-establish a young family in the community so that there would be someone there to regenerate, to provide the vitality for the social fabric of our area to continue.
In Morris township there is a real sense of grief at the loss of the buildings, because the people there know there will be no neighbours coming in. Instead of having a neighbour to the east and to the west and across the road, now in some situations there may not be a neighbour between four and five miles down either side of the road.
There are individual farmers reaching their mid-40s with youngsters making decisions as to whether or not they will wish to carry on farming. Right now there is no way those young people can compete with the prices the foreign buyer can afford to pay. We heard the member for Brant-Oxford-Norfolk (Mr. Nixon) speak very well about the fact there are a number of farmers who would like to sell out for the top dollar. In fact, economic pressures are such that it is necessary for them to get the highest dollar to get out. We cannot quarrel with that. I know there are a number of areas where this has happened.
Through the law office with which I was connected before I came here, I can locate where offers were made and where the people were given two or three hours to decide. They actually jumped at the opportunity to sell out because of health reasons or because they could not command the type of price they needed from a domestic buyer.
The fact that the government has not reacted quickly has aided in the removal of farm populations in our area. It has been to the social detriment of the small communities and, I think in the long term, to the detriment of the planning and development of Ontario in general. I cannot see where the government and the people of this province can afford to fail to recognize that they are not developing in their entirety the resources of Ontario.
In the rural area of southwestern Ontario there are resources which the people of Ontario should develop to their full potential. The failure of the government to recognize the foreign ownership problem has been one reason there has been a real problem with uncontrolled growth in the urban centres which has caused an awful lot of social pressures.
I do not feel the Minister of Revenue (Mr. Ashe) was right in failing to include in the bill a date at which this should have been recognized to come into effect. At the time he first introduced this piece of legislation in December 1982 he should have indicated the tax would be imposed from that date on.
Having failed to do that I have grave concern, as a member of my party pointed out, about the practicality of instituting at this late date a retroactive part to this bill. I think it will cause real hardship. It will cause a great deal of uncertainty that will take some time to unravel.
I can support the idea behind this bill, only I do not feel the bill itself is going to accomplish the type of things it should. It certainly is not going to prevent foreign ownership in Ontario, if that is what it was designed to do. I do not think it was designed to do that.
I do not think the Treasurer (Mr. F. S. Miller), with the number of things that he has said about the problems in eliminating the influx of capital, would have agreed with preventing foreign ownership of agricultural land.
From listening to the Minister of Agriculture and Food (Mr. Timbrell) speak at a local meeting in Lucknow, Ontario, not too many weeks prior, I do not think he would have supported that. He certainly came out very strongly in favour of the influx of foreign capital in Ontario and perhaps he is running some interference against the whole idea of the preservation of agricultural land from the hands of foreign owners.
If the government was really serious about this, it could do a number of other things that would really prevent the agricultural land of this province from falling into foreign hands, if it wanted to. But it does not want to do that.
The member for Brant-Oxford-Norfolk indicated the number of exemptions where agricultural land will be freed up to be purchased by foreign owners and they can, in any number of ways, get around the payment, or they can defer or request a repayment of tax initially paid.
Again, if we were really serious, and I say this with all sincerity to the minister, about preservation of agricultural land, which is what this bill speaks to, he could tighten it up considerably. I would ask him to look at some of those provisions to try and do just those things. Because the people in the township of Morris, where I come from, and in the township of Ashfield where there are large amounts of land purchased by foreign owners, and also in the township of East Wawanosh and township of Hallett, where large blocks of land have just recently been transferred, are still living there and are trying to make a community out of the remaining population and would dearly love to see some people who are willing to live in the community take over those pieces of rural real estate.
I commend the minister for at least an attempt at this, but after having introduced this in December he could have gone a long way to tighten up this particular recycled piece of legislation to an extent where it would have really helped preserve our agricultural land.
It brought to mind a situation a few years back when, with the best brains that government has over there in developing certain tax methods, one could buy a single bottle of pop without paying tax on it and yet if one bought a carton one was obliged to pay the tax. It was not long before six and seven-year-olds could realize that one could go in and buy one bottle at a time and circumvent laws that were made by the supposed genius that sits over there on the other side of the House drafting these tax laws. The same thing has happened with this land transfer tax. While the government sets itself up and boasts about its good management, it is hard to believe that we could have a tax structure where foreign investors could come into Canada and buy up some of our very fine farm lands strictly to speculate and to circumvent the tax laws. That in itself is bad enough. What compounds it is the fact that this government sat idly by and watched it happen, and land transfer tax was lost on many hundreds of transfers.
I have to point out to the minister, who happens to be here, that we on this side have never been convinced there has been good management by the government. This is just one of many instances where there has been such a simple way to plug a loophole, and it should have been done many years ago. Here we find ourselves with the minister wondering whether he should put an amendment.
I want it to go on the record that there are many of us on this side who have realized for a good long time that this government lacks any kind of ability when it comes to management. This is just another one of the long list of such involvements. The government experts have failed miserably to protect the citizens of this province.
The member for Huron-Middlesex indicated a figure of some $48 million as his estimate, or it was a figure that was given to him, of the revenue that was lost to the government in not enacting this piece of legislation a number of years ago. I do not know what that figure was derived from, but I suggest, at the very best, it is highly inflated. I will acknowledge and admit, as well as the member would, that we do not really know for sure, and neither would he.
Based on our estimate of the additional revenue, it is perceived we will derive somewhere between $2.75 million and $3.75 million a year from Bill 14. Based on the activity that has accelerated only during the last two years approximately -- it was very much less before that time -- I would agree it is possible. Neither of us can prove or disprove our figures. I will put that out front. There may have been a loss. I am not sure loss is the appropriate word. There was revenue that did not come in because this legislation was not in effect. It approached $15 million, but nothing more than that.
Having said that about the revenue that might have been lost, one has to put into perspective the issue and philosophy of this government and province over many years. We did not want to turn off the foreign investor in this province and country. If members will look back at the record of development in Canada and Ontario, it took place very significantly because of offshore moneys that were made available in many different ways. It is fair to say that a government, through enacting legislation -- maybe within a very narrow perspective with all good intentions and a very good rationale behind it -- can give a perception elsewhere that it has completely changed its philosophy and policy and has now come up with a new philosophy to discourage investment in this province by out-of-country capital.
That was always the risk that was there, and I suggest it was one of the reasons the government chose to wait a period of time before this problem became more of a problem. It has been recognized to have been so in the past year or two; hence, this legislation before us.
A question that came up all through this was how the act will be enforced. Will there be any cross-reference with the Ministry of Agriculture and Food legislation, the Nonresident Agricultural Land Interests Registration Act? Yes, there will be.
There are many ways in which we will be able to enforce this act. There are rather stringent penalty sections within the act that will place a financial penalty on not coming forward with the facts. There will be penalties upon those who are party to trying to circumvent the act. All in all, there could be significant financial penalties. It presumes that if they have avoided the act at the beginning, we will catch up with them somewhere along the line.
How will we do that? First of all, there is the obvious way that does not involve government at all. It is somebody phoning in or putting in a complaint that they think so-and-so is breaking the law. Of course, we would follow up on that.
However, there are a lot of internal ways in which we can enforce the provisions of this act. I will not go into them in any great detail. I would just refer members to the assessment program within this ministry that will bring forward changes in ownership of all relevant land on an annual basis. We can look back to see whether we have become aware of them under the Land Transfer Tax Act. If not, we can follow through as to the actual ownership change, how it took place, why it took place and to whom it took place.
We have in this same ministry the Corporations Tax Act and the relevant income tax acts. Tax returns will often identify transactions that have not been recorded elsewhere. We have the farm tax reduction program that was referred to earlier. We have the Nonresident Agricultural Land Interests Registration Act. All these pieces of legislation, most of them in the purview of the Ministry of Revenue, will be used to back up further the enforcement provisions within the legislation itself.
A person seeking to avoid the land transfer tax would have to be prepared either to default in filing returns or to file false or misleading returns under a series of federal and provincial statutes. If that is the case, a progressive number of penalties are being brought forward. That person or persons would be subject to those penalties when we catch up with them. It may not be tomorrow or the next day, but time passes and I think there will be many opportunities to find somebody who is breaking the law.
It has been somewhat confusing to listen to the six Liberal speakers who are somewhat middle of the road and straddling the fence on this issue as on many others. There seems to be general support for the bill. At the same time, I have heard many honourable members, including one of the most honourable here, the member for Brant-Oxford-Norfolk, put it quite plainly that there are many farmers and property owners within the province who want to sell their farms and look very kindly upon the numbers offered to them by foreign buyers.
I suggest we cannot have it both ways. I appreciate there are many other areas where we all run into the problem of saying, "Yes, it is great for me if I happen to be the one who will benefit, but if it happens to be my neighbour, I am opposed to it." Frankly, that is the principle many subscribe to here. They want to be able to look back and say, "Yes, I supported your interest in this position;" or alternatively, "Yes, I supported this position." That is fine, one can do that.
I find the same attitude on the issue of retroactivity. I think I heard a majority of the Liberal speakers say they would support some form of retroactivity. As a matter of fact, I heard suggestions of retroactivity back to the original date of Bill 14, back to the original date of the previous bill in the last session, back to the date of the introduction of the Nonresident Agricultural Land Interests Registration Act, right down to one or two others who said we should not make it retroactive at all.
Again, I guess one could call it protecting one's butt on that particular issue. One can refer to remarks being made on both sides of the issue. I must compliment members of the third party, however. I do not always agree with what they say or with some of their analogies and comparisons, but at least they are consistent on particular issues, this one included.
We are going to call the bluff of the opposition on the question of retroactivity. In committee I will be proposing the amendment I have here. It was prepared long before I came in here today and will make these sections retroactive to the date Bill 14 was introduced in this session, April 21, 1983. When the numbers are counted at the appropriate time in committee, we will see whether there is any sincerity in what was said in that regard.
Again, many members asked why we delayed for a particular period of time. They said taxes are always effective the date they are brought in; that is the date they are effective. Let me suggest there are many times when this has not occurred; one example just happens to come into effect today under the Retail Sales Tax Act, which we have not yet dealt with in second reading. Many of the items relating to sales tax were effective at midnight on the night of the budget, but the different sales taxes on alcoholic beverages became effective today, some two weeks later. It is not entirely unusual to have a different effective date.
If it would ease the conscience of some of the members, particularly some of those who may have had clients involved in transactions over the last while, I can assure them that if any solicitors or prospective buyers inquired of our various offices whether there was any possibility of retroactivity in this legislation, they were assured there was that possibility. Granted they were not told there would or would not be, I acknowledge that, but they were told and forewarned that the possibility existed.
It would not have been fair and equitable to bring the retroactive date back to a date in 1982 as suggested by the members of the official opposition. I think the date of April 21, 1983, when Bill 14 received first reading, is fair and equitable.
Although several honourable members spoke to the bill, in many cases there were repetitive items. I heard something about the goings-on in Thorold when a certain member was the reeve there. Although I have no personal knowledge of that issue, some closer to it may very well have.
I would respectfully suggest to those who feel they have some problems with the new Charter of Rights that the charter makes reference to the Criminal Code and, of course, we are not talking about a criminal issue in this regard at all. We are not talking in terms of penalties for transactions retroactive to April 21; we are talking about the validity of the legislation as of that date.
With that, I would close off the second reading debate and hope the legislation receives the support of all honourable members. I understand there is some concurrence to go into committee of the whole House to deal with particular amendments.
While I am on my feet, I might say I will not be supporting the amendment of the New Democratic Party, not because I have anything against it, frankly, but because this is the wrong piece of legislation for it. I will be quite happy to make the commitment to recommend it for consideration to the Minister of Agriculture and Food (Mr. Timbrell). because his bill is quite properly the place where that particular section should be embodied, not in the Land Transfer Tax Act.
Motion agreed to.
Bill ordered for committee of the whole House.
House in committee of whole.
LAND TRANSFER TAX AMENDMENT ACT
Consideration of Bill 14, An Act to amend the Land Transfer Tax Act.
Section 1 agreed to.
On section 2:
"(d) Where a corporation or a trustee or other holder of the legal interest in lands becomes liable to pay tax under subsection 2(a) or 2(b), the corporation or trustee or other holder of the legal interest in the land shall immediately file with the director appointed under the Nonresident Agricultural Land Interests Registration Act and report in the prescribed form setting out the names and addresses of the shareholders of the corporation or beneficiaries of the trust and containing a brief description of the land.
"(e) Where a shareholder or beneficiary of a trust named in a report filed under subsection 2(d) is itself a corporation or a trust, the report shall also set out the names and addresses of the shareholders of that corporation or beneficiaries of that trust.
"(f) All reports filed under subsection 2(d) shall be made available in the office of the director referred to in subsection 2(d) for inspection and copying by the public during ordinary business hours."
This amendment basically resolves the problem we find in a number of areas. From time to time it is difficult, nay impossible, to find out information that appears rather simple and necessary; that is, exactly who are the players in this type of an event?
This provision in this act would simplify the matter. It simply provides that when a transaction of this nature occurs it will now be possible for us all to find out exactly who is involved in this business transaction. It is a simple, straightforward amendment that would provide information which we, as a party, think is necessary and desirable.
I must point out that in recent circumstances the government itself has attempted to find out who is involved in various land transactions and has encountered similar frustrations.
We think this is not a big deal but it is an important one. It is a relatively simple matter to have them register at a simple source the names of the people involved in the transaction. I believe it would serve this province well to have such information available. I believe it is necessary if one is serious in trying to determine who is involved in this kind of transaction, the purchasing of what we think are large amounts of farm land.
I think it is straightforward. From time to time, I think I have heard members in all three parties say this is something that is important and desirable. I am putting forward this amendment this afternoon because I believe that in this bill it is fundamental to have access to the reality of what is actually going on. I believe it is fundamental to have in it an amendment of this nature which simply provides that we can find out who is involved in this kind of transaction.
If the government would enforce that act, and if its representatives would report to the house as they are supposed to, I think we would have a better understanding of who owns the land, where the shares have been transferred, what the source of the money is and all the other concerns we have about foreign ownership of land.
If the Ministry of Agriculture and Food is not going to enforce the act it introduced, maybe it will have to be left to the Minister of Revenue to try to find the answers about foreign ownership of land.
In that respect we are going to support this amendment. But I do not think it would be all that necessary if the Minister of Agriculture and Food would enforce the land registration bill, which I believe became effective in the latter part of 1980.
I suppose my views are not too different from those of the member for Huron-Middlesex (Mr. Riddell) in that I am not too sure whether this is identical wording to that already contained in the Non-resident Agricultural Land Interests Registration Act; but in my view it would be inappropriate in the Land Transfer Tax Act.
However, as I made the commitment in second reading debate, and will do so again right now, I will be very happy to pass it onto my colleague the Minister of Agriculture and Food, not only informally but formally as well. I will ask him to look at the amendment and request that, if he feels it is stronger or would add anything to the existing Non-resident Agricultural Land Interests Registration Act, he give it due consideration.
On that basis I will not be supporting the amendment for inclusion within the Land Transfer Tax Act. I will pass it on to the minister with the recommendation that he look at it very seriously.
All those opposed will please say "nay."
In my opinion the nays have it.
Section 2 agreed to.
Sections 3 to 11, inclusive, agreed to.
On section 12:
"(1) This act, except for subsections 1(1), 1(5) and 1(12); subsections 2(3) and 2(7), and section 4, comes into force on the day it receives royal assent.
"(2) Subsections 1(1), 1(5) and 1(12), section 2, subsection 3(7) and section 4 shall be deemed to have come into force on April 21, 1983.
"(3) For dispositions occurring on or before the day this act receives royal assent, the return required to be delivered to the minister under subsection 4(8) of the Land Transfer Tax Act as re-enacted by subsection 3(7) of this act shall be delivered on or before the 30th day following the day this act receives royal assent.
"(4) Provided that no disposition of agricultural land described in subsection 2(2c) of the Land Transfer Tax Act as enacted by section 2 of this act has occurred, no tax is payable where a corporation or a trust becomes a nonresident person as a result of the amendments contained in section 1 of this act, and no tax is payable with respect to any disposition of agricultural land that occurred before April 21, 1983."
I think I also indicated in the second reading debate that I could see fairness and equity in going back to the date of introduction for first reading of Bill 14, but I could not see the fairness or equity in going back to the introduction of the bill in the previous session of this parliament, namely, last December, or back to the original date that the bill of the Ministry of Agriculture and Food was enacted some two years or so ago.
This is the date that I am prepared to go with. I think it is fair and equitable. When the member looks back in Hansard, he will see the definite indication I gave that I was prepared to introduce an amendment. I did not say to what date, I will acknowledge that, but I did say that I was prepared to introduce an amendment and have done so.
The House recessed at 5:57 p.m.
top | new search