First Session - Thirty-Seventh Legislature of the Legislative Assembly of Manitoba Standing Committee on Law Amendments Chairperson Mr. Doug Martindale Constituency of Bu"ows Vol. L No.5- 10 a.m., Monday, July 17,2000 ISSN 0713·9586 MANITOBA LEGISLATIVE ASSEMBLY - Thirty-Seventh Legislature Member Constituency Political Affiliation AGLUGUB, Cris The Maples N.D.P. ALLAN, Nancy St. Vital N.D.P. ASHTON, Steve, Hon. Thompson N.D.P. ASPER, Linda Riel N.D.P. BARRETI, Becky, Hon. Inkster N.D.P. CALDWELL, Drew, Hon. Brandon East N.D.P. CERILLI, Marianne Radisson N.D.P. CHOMIAK, Dave, Hon. Kildonan N.D.P. CUMMINGS, Glen Ste. Rose P.C. DACQUAY, Louise Seine River P.C. DERKACH, Leonard Russell P.C. DEWAR, Gregory Selkirk N.D.P. DOER, Gary, Hon. Concordia N.D.P. DRIEDGER, Myrna Charleswood P.C. DYCK, Peter Pembina P.C. ENNS, Harry Lakeside P.C. FAURSCHOU, David Portage Ia Prairie P.C. FILMON, Gary Tuxedo P.C. FRIESEN, Jean, Hon. Wolseley N.D.P. GERRARD, Jon, Hon. River Heights Lib. GILLESHAMMER, Harold Minnedosa P.C. HELWER, Edward Gimli P.C. HICKES, George Point Douglas N.D.P. JENNISSEN, Gerard Flin Flon N.D.P. KORZENIOWSKI, Bonnie St. James N.D.P. - LATHLIN , Oscar, Hon. The Pas N.D.P. LAURENDEAU, Marcel St. Norbert P.C. LEMIEUX, Ron. Hon. La Verendrye N.D.P. LOEWEN, John Fort Whyte P.C. MACKINTOSH, Gord, Hon. St. Johns N.D.P. MAGUIRE, Larry Arthur-Virden P.C. MALOWAY, Jim Elmwood N.D.P. MARTINDALE, Doug Burrows N.D.P. McGIFFORD, Diane, Hon. Lord Roberts N.D.P. MIHYCHUK, MaryAnn, Hon. Minto N.D.P. MITCHELSON, Bonnie River East P.C. NEVAKSHONOFF, Tom Interlake N.D.P. PENNER, Jack Emerson P.C. PENNER, Jim Steinbach P.C. PITURA. Frank Morris P.C. PRAZNIK, Darren Lac du Bonnet P.C. REID, Daryl Transcona N.D.P. REIMER, Jack Southdale P.C. ROBINSON, Eric, Hon. Rupertsland N.D.P. ROCAN, Denis Carman P.C. RONDEAU, Jim Assiniboia N.D.P. SALE, Tim, Hon. Fort Rouge N.D.P. SANTOS, Conrad Wellington N.D.P. SCHELLENBERG, Harry Rossmere N.D.P. SCHULER, Ron Springfield P.C. SELINGER, Greg, Hon. St. Boniface N.D.P. SMITH, Joy Fort Garry P.C. SMITH, Scott Brandon West N.D.P. STEFANSON, Eric Kirkfield Park P.C. STRUTHERS, Stan Dauphin-Roblin N.D.P. TWEED, Mervin Turtle Mountain P.C. - WOWCHUK, Rosann, Hon. Swan River N.D.P. 99 LEGISLATNE ASSEMBLY OF MANITOBA THE STANDING COMMITTEE ON LAW AMENDMENTS Monday, July17,2000 TIME -- 10 a.m. We have two presenters who have registered to make public presentations on Bill 41. It is the LOCATION-- Winnipeg, Manitoba custom to hear public presentations before consideration of the Bill. Is it the will of the CHAIRPERSON- Mr. Doug Martindale Committee to hear public presentations on Bill (Burrows) 41 first? [Agreed] VICE-CHAIRPERSON- Mr. Jim Rondeau There are two presenters registered to make (Assiniboia) a presentation this morning: Mr. Paul Nielson, private citizen; and Mr. Victor Vrsnik of the ATTENDANCE -11-- QUORUM- 6 Canadian Taxpayers Federation. Is there any­ body else in the audience who would like to Members of the Committee present: register or has not registered and would like to make a presentation? Would you please register Hon. Mr. Lemieux, Hon. Mr. Selinger at the back of the room. Just a reminder that 20 copies of your presentation are required. If you Ms. Allan, Mrs. Dacquay, Messrs. require assistance with photocopying, please see Jennissen, Loewen, Maloway,Martindale. the Clerk of this committee. Penner (Steinbach),Rondeau, Stefanson. Before we proceed with the presentations, is it the will of the Committee to set time limits on WITNESSES: presentations? Victor Vrsnik, Canadian Taxpayers An Honourable Member: Yes. Federation Mr. Chairperson: Do we have an amount of MATTERS UNDER DISCUSSION: time in mind? Please indicate you want to speak. Bill 41-The Balanced Budget, Debt Mr. Gerard Jennissen (Fiin Flon): Mr. Chair,I Repayment and Taxpayer Protection suggest 10 minutes for a presentation and 5 Amendment and Consequential minutes for questions. Amendments Act Mr. Chairperson: It has been suggested 10 *** minutes for a presentation and 5 minutes for questions. Mr. Chairperson: Good morning. Will the Standing Committee on Law Amendments Mrs. Louise Dacquay (Seine River): I would please come to order. This morning, the prefer not to put on time limits. There are only Committee will be considering the following two presenters and we have only one bill before bill, Bill 41, The Balanced Budget, Debt Repay­ us this morning. I do not anticipate that they will ment and Taxpayer Protection Amendment and be long, drawn-out presentations. Consequential Amendments Act; Loi modifiant la Loi sur l'equilibre budgetaire, le Mr. Eric Stefanson (Kirkfield Park): I concur remboursement de la dette et la protection des with my colleague, Mr. Chairman. I know we do contribuables et modifications correlatives. put time limits sometimes when we have a 100 LEGISLATIVE ASSEMBLY OF MANITOBA July 17,2000 number of presentations, but with two presenters circulated. The draft was introduced as a private - and just the one bill I do not see a need to do that member's bill before the '95 election. The CTF this morning. continued to press for passage of the bill by launching a wide media and advertising Mr. Jennissen: I was a little hasty, Mr. Chair. I campaign that involved TV ads and billboards. realize there are just two presenters. I am quite willing to let debate or presentation to go on as As an aside, it goes to show that citizen long as is needed. group advertising can have a positive outcome from an election now that both the Government Mr. Chairperson: It is agreed there will be no and the Official Opposition endorse the time limits this morning? [Agreed] principles of Manitoba's taxpayer protection law. How does the Committee propose to deal The previous government took up the CTF's with presenters who are not in attendance today challenge and ran their election campaign on a but have their names called? Shall these names taxpayer protection plank. After their victory, be dropped to the bottom of the list? Shall the the Bill was passed into law. Manitoba's names be dropped from the list after being called balanced budget law has been widely described twice? [Agreed] as the most effective and comprehensive law in the country, on account of stiff penalties to Did the Committee wish to indicate how late politicians and the wide scope of the law. Other it is willing to sit this morning? provinces modelled their balanced budget laws on Manitoba. Mr. Jim Rondeau (Assiniboia): We will sit until noon. Today, we are delighted that the new provincial government is equally committed to Mr. Chairperson: Until 12. Is it agreed we sit the three main tenets of the law: the requirement - til1 12 noon? [Agreed] of annual balanced budgets, regular payments to retire the debt and taxpayer protection through I will now call on Mr. Nielson. Do you have the mechanism of a referendum. written copies of you brief for distribution to committee members? The benefits of the legislation are evident. Not since '94, when the deficit was looming at An Honourable Member: I do not think he is $196 million has Manitoba suffered from a here. deficit. On account of regular debt retirement payments, public debt costs have dropped from Mr. Chairperson: Okay, we will proceed with $597 million to $490 million today. That is $116 the next presenter and come back to Mr. Nielson million that otherwise would not have been later. Mr. Vrsnik, do you have copies of your available for tax relief and spending. presentation? Yes. We will ask the Clerk to distribute them. Mr. Vrsnik, please proceed. The per capita debt servicing costs were also $110 higher than today. One can only imagine Mr. Victor Vrsnik (Canadian Taxpayers what would happen to the province's credit Federation): Mr. Chair, members of the rating, ability to attract business investment and Committee, thank you for the opportunity to employment opportunities if deficits were as present on Bill 41. commonplace today as in the past. The Canadian Taxpayers Federation has Lastly, the taxpayer protection act has long demonstrated an interest in taxpayer shielded Manitobans from unaffordable tax protection legislation stemming back to its increases as other provinces compete to lower inception in Manitoba five years ago. Prior to the the burden of over-taxation. The overall '95 legislation, the CTF made taxpayer direction of the legislation is encouraging: protection legislation its main priority. Draft balanced budgets, debt repayment and taxpayer legislation was prepared by the CTF and widely protection. While the CTF is supportive of many July 17, 2000 LEGISLATIVE ASSEMBLY OF MANITOBA 101 of the amendments included in Bill 41, we have budget law armour has been detected. The law a few misgivings with the Bill as well. allows for one fatal exemption. Section 4.2 states that after an election, the government is not First of all, we agree with the amendments required to balance the books when a deficit is that provide for the repayment of outstanding incurred in a fiscal year of an election. This pension liabilities and limit the use of proceeds loophole absolves any government from ever from the sale of Crown corporations to debt having to balance the books in an election year. retirement only. Revenues from the sale of Crowns have the effects of insulating a * (10:10) government from having to maximize operating efficiencies. This provision led to much confusion and anxiety this past year when Manitobans were In terms of retiring general purpose debt and told to brace themselves for an end-of-year the pension liability, the repayment schedule deficit for '99-2000 of $262 million to $417 remains to be seen.