Mr. Gary Doer (Leader of the Opposition): My question is to the First Minister. Mr. Ross Nugent has acted for years for different Crown corporations, the Manitoba Telephone System, Manitoba Hydro. He has acted through different political parties, and he is a person who has a very, very honest reputation in terms of his presentations on behalf of the bodies that he represents. Unfortunately, he has joined now the group of people on the Premier's hit list of being wrong about the Manitoba Telephone System. He has joined the seniors of Manitoba, he has joined the municipalities of Manitoba, he has in fact joined the majority of Manitobans, in the opinion of the Premier, as a person who is wrong.

I would like to ask the Premier to confirm that Mr. Nugent, in his verbal presentation to the CRTC, the testimony of which we tabled yesterday, was accompanied by MTS regulatory staff at the Ottawa hearings.

Hon. Gary Filmon (Premier): I am informed that the process before the CRTC was the presentation of a written document to the CRTC and that Mr. Nugent, as is confirmed by the transcript that we have, in his capacity as a representative of the Manitoba Telephone System with respect to the rate application of the Stentor group of companies, decided to add some verbal presentation, shall we say extemporaneously, to the written document, and he made that presentation.

In that presentation, for whatever reason, some of the comments he made were regrettably inaccurate, and I have to believe it was simply because he was not in possession of all the facts on these issues.

Mr. Doer: He is not in possession of all the facts. Perhaps the Premier someday would let all Manitobans get all the facts on the Manitoba Telephone System. When you have legal counsel, respected legal counsel, arguing before a quasi-judicial body for an exemption to raise the rates beyond the cap, surely he would be entitled to all the facts, as would all Manitobans, as the Premier unilaterally breaks his election promise and sells a Crown corporation that he has no democratic mandate to proceed with.

I would like to ask the Premier, in light of the fact that Mr. Nugent's testimony was provided to the CRTC on November 13 and MTS regulatory officials were in attendance, can the Premier table today the amended statement that he would have had to table on November 13 or 14 to the quasi-judicial body, or are we just into major damage control because the Premier has been caught with a contradiction with the legal counsel, Mr. Nugent?

Mr. Filmon: I have the utmost respect for Ross Nugent. In fact, I count Ross Nugent as a personal friend of many, many years. Several of Ross Nugent's daughters babysat my children. Ross Nugent has often proudly said that I am the first politician for whom he put a sign on his lawn, so I have absolutely the utmost respect for Ross Nugent, but clearly in his role in this particular case on behalf of Manitoba Telephone System, he was adding extemporaneously many things to the record that regrettably were not accurate, and they were because he has represented many different Crown corporations, and many different circumstances within those Crown corporations are not necessarily applicable in these circumstances.

I would say, for instance, one of the points that he makes in this off-the-cuff comment is MTS has never been allowed by statute to earn a profit. There is nothing in MTS's statute that says it cannot earn a profit. There is not, for instance, the same reference that is there for the Manitoba Hydro that says they must provide service at cost. That is not there in MTS. He is not aware of that unfortunately, and that goes as part and parcel of the presentation.

He said that MTS, quote, has been in the development of a rate stabilization reserve over the years. They have never had a rate stabilization reserve over the years. That has not been something that MTS has done. MPIC has and so has Manitoba Hydro, both of whom Mr. Nugent has represented at rate hearings before the Public Utilities Board. The one area that I am surprised the member does not recognize as being clearly inaccurate is, he says, further in his presentation, approximately two years ago, as a matter of government policy, MTS was required to establish a program called Service for the Future.

The member opposite, the Leader of the Opposition, constantly reminds us that Service for the Future was his program that he conceived in 1987. It was brought in and the written presentation that was put before CRTC clearly puts on the record that Service for the Future was announced in 1988, and the investments began in 1989. Yet he says it was only two years ago that it was. So I can go through this, chapter and verse, and clearly there are a number of inaccuracies. That is because it is done off the cuff, and he was not clearly in possession of the facts.

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Mr. Doer: Madam Speaker, perhaps the Premier would do as we have challenged him to do all along and table all the facts in this Legislature, all the information in this Legislature, not just the brokers information and the Bay Street people that the minister and the Finance minister are following in their broken election promise.

Madam Speaker, I asked the Premier to table the amended presentation to the CRTC. This is a quasi-judicial body. The Premier obviously has not got one since November 13, and now they are into full damage control because Mr. Nugent clearly states that privatization will raise costs for the Manitoba Telephone System.

Madam Speaker, I would like to ask--

Some Honourable Members: Oh, oh.

Madam Speaker: Order, please.

An Honourable Member: Read it.

Mr. Doer: I obviously read it before the Premier, judging from his answers yesterday.

In light of the fact--

Some Honourable Members: Oh, oh.

Madam Speaker: Order, please. The honourable Leader of the Opposition, to pose a question.

Mr. Doer: Both the Manitoba Telephone System in its submission and Mr. Nugent in his summary to the CRTC body are requesting an increase be on the cap for Manitoba Telephone System. The Premier can solve this problem today and keep his word and recommend to the Manitoba Telephone System that they withdraw the request to exceed the cap; then the argument about Mr. Nugent's testimony and the MTS's testimony will not be a point because the Premier will withdraw the request to raise rates beyond the cap, and all of us can be assured that we can go on to debate on MTS with all the facts before us.

Mr. Filmon: Madam Speaker, if the member opposite will be honest and direct about it, and read two things, one being the presentation in writing that MTS made to the CRTC, and two being the comments that Mr. Nugent has made, Mr. Nugent's reference to rate shock and the request for more flexibility by MTS both referred to two things and two things only: Service for the Future, the requirement to recover their investment, that $630 million invested in Service for the Future is one way in which they say that they want to have some flexibility because of the impact on rates of attempting to recover those investments; secondly, as CRTC's own policy of rate rebalancing which they enunciated and embarked upon approximately a year ago.

Those are the two factors that they refer to, and neither of those factors are impacted by whether it is privately or publicly owned. That is in both the comments of Mr. Nugent, and it is in the Manitoba Telephone System's written response and written presentation. Those are the reasons why they asked for flexibility, and they are reasons clearly that would prevail, whether it was publicly or privately owned, Madam Speaker.

Mr. Steve Ashton (Thompson): We on this side of the House and all Manitobans have gotten used to the Premier trying to attack the personal credibility of those that dare to disagree with him, but the most pathetic example of this is when he launches an attack on the credibility of a respected counsel who made not off-the-cuff comments but an oral presentation to the CRTC on November 13.

I would like to table a copy of the written submission, and I realize the Premier may want to attack this as well, because this was filed November 13, 1996. Mr. Nugent, in his oral presentation, stated: When that happens, MTS with privatization will face costs it has never faced before.

I am wondering if the Premier can then explain why the written submission states that this legislation, Bill 67, will affect MTS and will result in cost changes to MTS and then outlines the same two elements that Mr. Nugent outlined in his oral presentation.

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Hon. Gary Filmon (Premier): Madam Speaker, I repeat again that, for instance, in the oral comments, among other things, the counsel said that various rulings would be anticipated by the federal government with respect to taxes and other matters will be made known, he said.

Well, the fact of the matter is, as I have said before, more than 10 days ago in this House, that that ruling has already been obtained with respect to the transference of pension funds into the Manitoba Telephone System on a privatized basis. That transference of over $325 million would result in a cushion that would see the telephone system not having to pay taxes for a considerable period of time.

The second thing, of course, is with respect to the borrowing rates. I have indicated that there are two factors there. Firstly is that, in some cases, borrowings, bonds would be replaced by equity and that the rate for it being paid as a return on equity clearly has been established by CRTC as being less than the rates of interest being paid, so there would be a saving there.

The second thing is the analysis which has been received by the telephone system with respect to its borrowing rate. They make a point, for instance--the brokerage firms which would have to borrow money make the point that MTS currently pays a 50 basis points, which is a half of 1 percent interest rate fee to the government of Manitoba for the guarantee that they give, and MTS on a private basis is expected to have at least as good a credit rating as the government of Manitoba currently does. Their analysis is that, on borrowing, MTS would pay 40 basis points less than they currently pay for their money.

So, on both those points, there is adequate assurance and there is adequate information. Members opposite may not want to believe that, it may not fit with the scare tactics that they put forward, but that is fact, Madam Speaker.

Madam Speaker: The honourable member for Thompson, with a supplementary question.

Mr. Ashton: Madam Speaker, now if the Premier is saying that talking about these issues is a scare tactic, I wonder if he also considers the June 10 MTS CRTC submission which also outlines that there will be changes due to privatization, including the tax status and segment cost of capital, is he now attacking both the CRTC submission of MTS on November 13 and also the June 10 MTS submission? Is he the only one in Manitoba who knows the truth? Is the MTS wrong, too?

Mr. Filmon: Madam Speaker, clearly, in June those factors had not yet been totally decided because the application to the federal government for the tax ruling with respect to the pension funds was not yet received, and they made that as an unknown. I said to the member opposite, that has been received, and it has been received in the favour of the Manitoba Telephone System, so clearly it is a positive response to that situation and that unknown. Similarly, with respect to the borrowing rates, again, that analysis has been made. I have put the facts on the table. MTS will borrow at a better rate than they do today.

Mr. Ashton: Madam Speaker, I would appreciate the Premier tabling any information on MTS, something he only does--

Madam Speaker: Order, please.

Mr. Ashton: I want to ask as a supplementary, Madam Speaker, a final supplementary on this question, how the Premier expects anyone to believe that now what he is saying essentially is that MTS was wrong on November 13 for the filing of this application, and if he is saying they are wrong, when are they going to withdraw the application? He cannot have it both ways.

Mr. Filmon: Madam Speaker, we have indicated in the past that MTS's privatization, and I believe that the counsel for the members opposite has stated in his presentation that there may well be efficiencies that will be as a result of MTS privatization, those are circumstances that may work in its favour. We have already established that in terms of their borrowing costs, their costs of financing. There are several factors, one being the replacement of equity for debt and the more favourable borrowing rates that will be in their favour. Those are facts, and they speak for themselves.

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Mr. Ashton: I know, once again, the Premier--

Madam Speaker: With a new question.

Mr. Ashton: On a new question, Madam Speaker--refuses to answer some very key questions, including my final question on the last series of questions.

I have a further question, though, Madam Speaker, and this is also in regard to the CRTC written submission, which I am sure the Premier may wish to attack as well, which points out what we on this side of the House have always said, and it states very clearly that Manitoba has been the leader under public ownership because of the public mandate in providing service to rural and northern Manitobans. It is documented in this submission. It also asks under the rate-capping regime that is going to be imposed by the CRTC, that those costs be part of the exceptions they are seeking to the rate cap, in fact, that they be passed on to Manitobans.

I would like to ask the Premier if he can now confirm that Mr. Nugent did not even deal with the possibilities that Manitobans will be paying significantly higher rates, especially rural and northern Manitobans, because of those service enhancements which are the result of a public company.

Mr. Filmon: No, as a matter of fact, it is totally the contrary. Mr. Nugent did refer to this Service for the Future investment of $630 million as a reason why the company wanted more elbow room.

Mr. Ashton: Will the Premier be honest with Manitobans and indicate, in this case, the flexibility that MTS is applying to the CRTC for is in terms of phasing in what will be very dramatic rate increases to rural Manitoba? Will he define what elbow room really means, and that is that rural Manitobans and Manitoba generally will be paying a lot more under this private company?

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Mr. Filmon: Madam Speaker, the only person being dishonest to Manitobans is the member for Thompson.

Some Honourable Members: Oh, oh.

Madam Speaker: Order, please.

Mr. Ashton: A point of order, Madam Speaker, I did not lie to the people of Manitoba in the election about selling off MTS. I demand you have the--

Madam Speaker: Order, please. On the point of order raised by the honourable member for Thompson, I am ruling that he does not have a point of order because he used very unparliamentary language in posing the point of order.

Madam Speaker: On the point of order now raised by the honourable member for Thompson, he did address a point of order. He indicated that the honourable First Minister had used unparliamentary language, but he did not do that in his first point of order.

On the point of order now raised by the honourable member for Thompson, indeed he--on the same point of order, the honourable First Minister.

Mr. Filmon: Madam Speaker, on the same point of order, I would ask that if the word "dishonest" is not to be used in this Chamber, then the member opposite cannot say that the Premier is not being honest with people. He cannot use it--well, he cannot have it both ways. If he wants it not to be used, he ought not to use it.

Madam Speaker: The honourable government House leader, on the same point of order.

Hon. Jim Ernst (Government House Leader): Madam Speaker, the use of the word "dishonest" appears, as the member for Thompson indicated, under Beauchesne Citation 489 as a prohibited word under parliamentary language, but it also appears under Beauchesne Citation 490 which says it is parliamentary, so I see it has been used on both sides from time to time, and it depends on the context alone as to whether it is unparliamentary or not.

Madam Speaker: On the point of order raised by the honourable member for Thompson, spoken to by the honourable First Minister and the honourable government House leader, I would like to remind all honourable members that indeed it is very much the tone in which the word is used as to whether it is determined to be parliamentary or unparliamentary. The government House leader is accurate that it does appear and has appeared on both; however, I want to remind all honourable members and particularly people posing questions that I have allowed an awful lot of latitude.

When I look back on previous rulings by Speaker Rocan, Speaker Walding, even the words "to tell the truth" have been ruled unparliamentary. Of recent, regrettably, I have exercised an awful lot of latitude in allowing those words to be used.

Mr. Ashton: Madam Speaker, I am just wondering if your ruling is whether the Premier (Mr. Filmon) was parliamentary or unparliamentary. I am not sure I caught that.

Madam Speaker: Order, please. The honourable First Minister used the words explicitly in reference to a member. Indeed, in that context, I would deem it to be unparliamentary, and I would ask the honourable minister to withdraw his comment.

Mr. Filmon: I will withdraw that comment, Madam Speaker.

Madam Speaker: I thank the honourable First Minister, and I would like to remind all honourable members once again to exercise extreme caution in the choice of your words.

Madam Speaker: The honourable First Minister, to complete his response.

Mr. Filmon: I repeat that both in the context of the written presentation and the oral comments that were added by the MTS legal counsel; they asked for flexibility with respect to the rates of Manitoba Telephone System, which would apply whether it was publicly or privately owned, for two things. One is for the ability to recover the investment being made in Service for the Future, some $630 million, and, secondly, with respect to CRTC's policy of rate rebalancing. In both those areas, they are making that appeal for flexibility with respect to rates in future based on the fact that those things are in existence whether or not it is publicly or privately owned.

Mr. Ashton: It is a final supplementary. I would like to ask the Premier, if he is now saying that they do not need this application, why the application specifically is to deal with the factors including the, quote, costs of privatization.

Will the Premier confirm that in fact what MTS has been doing with the CRTC is making sure it has the ability to raise its rates to deal with potential costs of privatization which were outlined by Mr. Nugent and by MTS, both in November and June?

Mr. Filmon: Again the member is wrong. I am not arguing that they do not need this application. I am saying that this application is required whether they are publicly or privately owned because the two major factors that they are asking for consideration on are the ability to recover their investment in Service for the Future, some $630 million, and their concern about the rapid rebalancing that the CRTC is mandating. On both those counts they are asking for flexibility whether it is publicly or privately owned.

Madam Speaker: Order, please. I would remind all honourable members this is not a time for debate; this is Question Period.

Mr. Leonard Evans (Brandon East): Madam Speaker, on February 21 of 1996, the mayor of Brandon sent a letter to the Minister for MTS outlining the serious concerns the City Council had with respect to the potential negative effect of a privatized MTS on the city of Brandon and on the province.

The letter concludes: On behalf of the Council of the City of Brandon, I urge the government of Manitoba to hold public hearings so that the shareholders of the Manitoba Telephone System have an opportunity to make their concerns known. Signed by Mayor Rick Borotsik.

The minister replied, in his letter of March 1, no decisions have been made or will be made about the privatization of MTS without public discussion, clearly implying that there would be public hearings.

My question to the minister is, will he now live up to his written word and put Bill 67 on hold and conduct a series of public hearings throughout Manitoba?

Hon. Glen Findlay (Minister responsible for the administration of The Manitoba Telephone Act): Madam Speaker, I think the member, if he checks the record, will find that over 50 hours of public presentations have just been held very recently in the province of Manitoba on this bill.

Madam Speaker: The honourable member for Brandon East, with a supplementary question.

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Mr. Leonard Evans: Madam Speaker, how can the minister give this reply since the City of Brandon in its letter had specifically asked for a series of public hearings and would understand from the minister's written response that he implied such hearings would occur before a decision on privatization?

Mr. Findlay: Madam Speaker, I just reminded the member, every bill goes to public presentations, and it was held on this bill. In addition, this cabinet and caucus had discussions with many people in groups across rural Manitoba the last number of months, including some 48 meetings held by MTS senior officials on request from a variety of different councils and councillors all over rural Manitoba.

Mr. Leonard Evans: Madam Speaker, how does this minister expect the City Council of Brandon and the citizens of Manitoba to have any respect for the minister and his government when he clearly implied in his letter that public hearings would be held before a decision was to be made on privatization?

Mr. Findlay: Madam Speaker, as I have already stated, an awful lot of hours have been spent on the public hearing process hearing people's input. Amendments have been made because of that process, but that does not change the fact that the telephone system with the government as a Crown corporation owner faces serious problems in terms of competition, current debt and the need for new capital. Those issues must be addressed and the process of what we are doing does address them responsibly for all citizens of Manitoba for today and on into the future.

Mr. Kevin Lamoureux (Inkster): Madam Speaker, I would like to make reference to a newspaper article back on June 4, 1991, where the editorial was actually expressing an opinion. It goes like this and I quote: Gary Filmon was appalled that the NDP, which said it stands for democracy, would try to cut off people's right to speak. Closure has been used by governments to cut off lengthy debate, he said, but the NDP was using it for a cheap political thrill. It was the most ignorant thing he had ever seen.

Madam Speaker, my question to the Premier: Has anything changed in the sense that does he still believe closure is not the way to go in dealing with the affairs of the province of Manitoba?

Hon. Gary Filmon (Premier): My answer is the same as it was the last time the member asked that, and I would suggest that he hire a better research staff if he has to keep repeating the same questions every day.

I have indicated that my preference is not to use closure.

Madam Speaker: The honourable member for Inkster, with a supplementary question.

Mr. Kevin Lamoureux (Inkster): Madam Speaker, maybe if the minister or the Premier would answer the question, we would not have to repeat some of them.

Madam Speaker: Order, please. The honourable member was recognized for a supplementary question that he knows requires no postamble or preamble.

Mr. Lamoureux: Madam Speaker, is the Premier prepared to permit debate for as long as this House is prepared to sit with respect to Bill 67?

Hon. Gary Filmon (Premier): Madam Speaker, we have rules in this House, rules that were unanimously agreed to, rules that were worked out in an all-party consultation, rules that have been referred to, I think, rather eloquently by the member for The Maples (Mr. Kowalski) when he said that people's words are their bond and that trust is an important factor in this House. I expect that this House operates on the basis of rules, trust and understandings that are in a time-honoured tradition of the British parliamentary system.

Mr. Lamoureux: Madam Speaker, given the Premier's response, I take it then the Premier is prepared to bring in closure on Bill 67.

Mr. Filmon: Madam Speaker, you know the Liberals have used closure in Ottawa on numerous occasions. The New Democrats used closure when they were in office in this province, but I have said that is not my preference. The rules do provide for closure; I acknowledge that. I have said that is not my preference.

Mr. Gord Mackintosh (St. Johns): Madam Speaker, my question is for the Minister of Justice.

Would the minister assure Manitobans that the counselling or treatment programs that she has in place in the youth and adult correctional facilities in Manitoba, such as anger management, substance abuse, sexual abuse, family violence, impaired drivers program, can be effective in dealing with the causes of crime and preparing inmates to return to the community as law-abiding citizens?

Hon. Rosemary Vodrey (Minister of Justice and Attorney General): Madam Speaker, there are programs in our institutions across the province. They are programs delivered to both turn around behaviour and attitude and, as always, however, they are dependent upon the individual who goes through that program also having a willingness to fully participate. As the member knows, that has been our concern about long-term offenders for some time, and one of the reasons why we put the CNAC process in place in Manitoba in that there are sometimes individuals who finish their sentence, who come to the legal end of their sentence and in fact there is still concern about public safety, and so our government acted where the federal government would not act in the interests of public safety.

Mr. Gord Mackintosh (St. Johns): In light of that answer, Madam Speaker, would the minister then explain why, except for the Family Violence Program which only started up again about six weeks ago, all the counselling or treatment programs at Headingley for going on seven months now have been scrapped?

Hon. Rosemary Vodrey (Minister of Justice and Attorney General): Madam Speaker, programming across the province has had to be adjusted according to which inmates are in which institutions, whether in fact there are inmates in institutions as well and whether or not the institutions were in fact in lockdown. The member is aware that in Headingley we were in a lockdown situation for some significant amount of time. However, there is now the beginning again of some of the programming, as much as is possible to deliver, with inmates moving through the institution, but the first issue is the issue of public safety, the safety of our correctional officers, the safety of the institution. There are, however, programs available within our community corrections to these individuals.

Mr. Mackintosh: Would the minister admit that this warehousing, this dangerous warehousing of inmates who are just let loose on the community without any positive intervention or efforts to change their behaviour is a threat to our community?

Mrs. Vodrey: Madam Speaker, what is a threat to the people of Manitoba is the behaviour of the member for St. Johns from the very day of the Headingley riot and onward, as well as comments that he has made previously that fully indicate that he often does not support incarceration, that he would prefer to see people within the community, and that his behaviour on the day of the Headingley Institution--was so inflammatory, it was only with the benefit of professional correctional officers, professional police services that we did not have deaths or escape on that day.

Ms. Diane McGifford (Osborne): Madam Speaker, one of the real dangers in Manitoba is to Manitoba women. During 1996 and to date, 12 Manitoba women have been murdered in domestic situations, and we hear today from the member for St. Johns (Mr. Mackintosh) that all programs at Headingley have been cancelled for seven months, although the domestic abuse program was recently reinstated. Since clearly this flies in the face of safety for Manitoba women, I want to ask the minister how many domestic abusers were released without taking a program in domestic abuse, and how many were released early.

Hon. Rosemary Vodrey (Minister of Justice and Attorney General): Madam Speaker, as the member knows, we also have programs that deal with people who have been convicted of domestic violence cases available through our community corrections, so I believe that she is well aware. I have gone through those issues with members opposite over the course of Estimates for at least three years. So I think that if the member is in any way questioning this government's commitment to dealing with domestic violence, I think she can clearly look at our record and the total lack of record from members opposite. It was this government that set up the domestic violence course; it was this government that developed the programs. Across this country, our province has been recognized as leaders in the area of domestic violence cases.

Ms. McGifford: Madam Speaker, 12 dead women are questioning this government's--

Madam Speaker: Order, please. The honourable member for Osborne, to pose her question now.

Ms. McGifford: Since recidivism is particularly an issue among domestic abusers, I want to ask the minister to tell us what steps she has taken to protect women whose partners were released without taking the appropriate programs in domestic abuse.

Mrs. Vodrey: Madam Speaker, as I said, there is also programming in the area of domestic violence available within the community. That has been available across the province, and we continue to work. One of the most important things that we have done in the area of dealing with offenders who reach the legal end of their term, whether or not they have taken a program--because people do reach the end of their term; that is not dependent on the taking of a program--is to recognize and apply a risk assessment instrument to that individual to recognize that they may in fact be a long-term offender, that there may in fact be recidivism. That is why we have asked the federal government to be absolutely vigilant in setting up a national tracking system and that is why this province, in the total void of the federal government's action, set up the CNAC process, the community notification process to deal with the safety of women and children in this province.

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Mr. Tim Sale (Crescentwood): Madam Speaker, earlier in Question Period the Premier (Mr. Filmon) indicated that the MTS had received a favourable tax ruling in regard to the $325 million in the pension fund contributed by the employers over the last few years. Could the Premier clarify for the House whether this means that the new company will have carry-forward tax deductions equivalent to approximately this amount that it can use to offset any profits which it might be generating during that time?

Hon. Eric Stefanson (Minister of Finance): Madam Speaker, the issue is that Manitoba Telephone System will get a one-time deduction for the employer contribution to the pension plan depending on what that does to the overall profitability of the company. With that magnitude of a deduction, it will put the company into a loss position which for tax purposes can be carried forward for up to seven years.

Madam Speaker: The honourable member for Crescentwood, with a supplementary question.

Mr. Sale: Are the Finance minister and the First Minister saying to Manitobans then that we have paid for the contributions to the pension plan through our rates, $325-million worth, now we are going to pay again because they are going to be allowed to avoid taxes by claiming something we have already paid for as a deduction in the future?

Mr. Stefanson: I find this twist really interesting from the member for Crescentwood. On the one hand they are expressing concern about what will happen to rates and the whole issue of paying taxes and so on and the company becoming profitable and as a result of that rates going up, in terms of their estimation. On the other hand they are being told now that the company will get a tax deduction for the pension contributions, and it will be able to be a method of maintaining that rates do not increase. So I am not sure where the member for Crescentwood is really coming from on this issue.

Madam Speaker: The honourable member for Crescentwood has time for one very short supplementary question.

Mr. Sale: Is the Finance minister then effectively confirming that Manitobans had a choice--they could either pay sharply higher rates for their telephone system or they could pay through the loss of tax revenues from a private company? It does not much matter, does it? Manitobans are paying one way or the other.

Mr. Stefanson: What the member for Crescentwood seems to fail to understand is that Manitoba Telephone System today does not pay any corporate income taxes; it does not pay any dividends back to the government of Manitoba or the taxpayers of Manitoba. Through this deduction it will be able to not pay taxes for a period of time, but ultimately Manitoba Telephone System will become taxable and will provide a return to the taxpayers of Manitoba.

Madam Speaker: The time for Oral Questions has expired.