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Ontario Hansard - 07-June1993

Hon Bob Rae (Premier): The single most important goal of this government is to make investments and implement policies that will put Ontario back to work. The plan we have proposed to renew the Ontario economy includes the largest capital investments by any province to modernize our infrastructure. Through an imaginative array of programs under Jobs Ontario, we're putting tens of thousands of Ontarians back to work building the roads, bridges, subway lines and other public facilities that help improve the province's competitive edge and therefore its future economic wellbeing.

On another front, we're working in partnership with the private sector to make investments which secure existing jobs and provide workers with new skills, and to build modern manufacturing facilities that are the source of jobs for the future. We're achieving our goal of putting Ontario back to work in the face of the worst recession since the 1930s, despite drops in government revenues and increasing demands on public funds.

Our plan to renew the economy of Ontario is built on a tough, practical approach to managing the government's finances. This government has accomplished what no government of this province has done in 50 years. We have, for the first time, reduced total government spending on programs. Using principles of good management and fairness, we've implemented a program to reduce and then eliminate the provincial deficit. We have cut the government's own expenses by $4 billion. The recent budget introduced tax and other revenue measures worth another $2 billion. We've asked the people of Ontario to bear a fair share of the burden of controlling the deficit. Every sector and every region of the province has made a contribution to moving the province towards that goal.

The concept of negotiating a new social contract is a vital part of the government's strategy of economic renewal and job creation. The thousands of formal and informal agreements among those who deliver public services, those who benefit from them and those who pay for them all constitute the social contract which makes Ontario work.

The renewed and modern economy Ontario needs to move into the future requires that we also rethink and modernize the social contract that binds our society and makes it work. The government proposed this process of modernization and restructuring to public sector workers. It was clear to everyone that one of our goals was to achieve a saving of $2 billion in public sector compensation. We also made it clear that in this challenge there was an opportunity.


We proposed to the province's 950,000 public workers that they participate in negotiating new ways of carrying out their work for the public, in fixing their compensation, their benefits and working conditions.

Quelques personnes nous ont dit et soutiennent toujours que ce n'était qu'une perte de temps, qu'il aurait été plus simple de ne pas penser à négocier et d'imposer tout simplement notre solution. Ce sont les mêmes premiers ministres de salon qui déclarent qu'il est facile de combler un déficit, de créer des emplois et de remettre l'Ontario sur la route de la relance économique.

Nous n'arriverons à rien si nous essayons de jeter le blâme sur quelqu'un d'autre ; ce n'est qu'en collaborant que nous trouverons des solutions.

We will not succeed by finding someone to blame. We will only succeed by working together to find solutions, and that remains the foundation of the government's approach.

The effort to build a new social contract between the people of Ontario, the government, the nurses, teachers, police officers and other public workers of the province is a difficult task. It's full of risk and frustration. Though the effort at the negotiating table did not achieve everything that we wished, it was none the less an important process. The talks focused the attention of all public workers, indeed of the entire population of the province, on the need to rethink how we deliver services and create the conditions that empower public workers to do the best job possible for Ontarians.

The social contract talks have broken rigid patterns of thinking about public services. They have set in motion a process of change and brought forth from public workers new ideas to improve public services and to keep them affordable. The representatives of public workers in every sector of society had a hand in shaping new ideas, bringing new approaches to the table, and in building through a process of collective bargaining an agreement not only to reduce costs, but to bring the public sector into the future as an essential support for the economic wellbeing and quality of life of people in Ontario.

The many ideas and new approaches that were arrived at during the social contract negotiations are a credit to all those who participated. They are an achievement for the people of Ontario, whose investment of support and hope in the talks will be justified by the results: better services delivered more efficiently and at a better cost.

The government is proud of what took place around the social contract table. I'm honoured today to report on the content of the package that had been negotiated by the end of the talks last week. Many people worked countless hours to forge these proposals. They drew on their individual experiences as public servants to examine how they work, how they can work better and how the exchange between public workers, those who use public services, those who pay for them and the government that manages the process can be made to work better for all the residents of Ontario.

It's not easy to change how we think about work and our routines, to adjust our expectations to reality and to put the common wealth or good ahead of private or partisan interests. Those who worked at the social contract tables achieved that objective. It is their efforts which brought about the offer which was on the table from the government when the social contract talks came to an end. That offer included:

-- Job security: The guiding principle has been to preserve jobs and to preserve services. The result was an assurance that every worker affected by the abolition of a position would have a priority for another job with the same public sector employer or with employers in the same industry or within the same region. For those affected by layoffs, we proposed a job security fund totalling $300 million over three years to top up laid-off workers' UIC benefits to 95% of take-home pay for one year or to be used to extend notice periods and allow time for retraining. The job security proposals had the effect of strengthening existing collective agreements in the critical area of job security. I'm proud of those proposals; I think they're very sound.

-- To recognize the link between the social contract and public investment in jobs, it was proposed to set up a provincial capital partnership board whose job it would be to participate in decision-making on capital investments aimed at improving public services.

-- Employees making less than $30,000 a year would be exempt from measures that affect compensation.

-- Wage increases and merit increases will be deferred until April 1, 1996.

-- The most significant savings would be realized by setting up a system of unpaid leaves of absence administered in such a way as to protect overall service delivery and to accommodate the preferences of individual workers.

-- Public sector workers would participate in eliminating wasteful expenditures and practices. Savings would be used as follows: one half to offset the social contract target for the sector where waste was eliminated; one half to be retained by the employer to preserve services and employment through training or redeployment.

As a result of this process, it was envisaged that there could be a saving of $500 million in contributions to pension funds: not to entitlements from those funds, but to contributions to them. The government proposed to utilize this amount to provide job security and to achieve part of the total savings target of $2 billion. This proposal would have in no way affected the pension entitlements of public workers, but rather was evidence of the government's flexibility in working with public sector unions to achieve the overall target for savings.

These and the other components which were on the table at the end of the social contract negotiations could not have been arrived at without the full and energetic participation of public sector unions, employers' groups and government representatives. They are the result of a new way of achieving our common purpose: to improve the quality of the services we provide to the public, to bring their costs in line with our resources, to make public sector workers participants in decisions that affect the cost and quality of the services they provide to the public.

I invite all members of this House to join me in congratulating everyone who laboured these past weeks to bring forth the ideas and solutions to establish a new social contract for Ontario. The government of Ontario welcomes these solutions and will ensure that they form part of the process of reforming public services in Ontario so they can better serve the interests of the people of this province.

That remains one of our key objectives and it remains our intention, as part of this process of reform and renewal, to achieve the savings of $2 billion in public sector compensation that was our initial target. The government will announce later this week how it will keep its commitment to achieve those savings as part of its plans to control the debt, to protect jobs and services and to put Ontario back to work.

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