October 30, 2013

Mr. Ernie Hardeman:

I’m pleased to rise today to speak to Bill 105. The Progressive Conservatives realized the need to reduce the burden on small business in 1996 when we first announced the $400,000 employer health payroll tax exemption. Although the goal of this new bill may remain to help small businesses with this exemption, it’s obvious that the purpose of the act does not achieve that end.

The government claims that this bill will help small business by increasing the employer health tax exemption by a mere $50,000—one employee. But the members on the opposite side fail to realize that if the current tax-and-spend culture continues to exist, there won’t be any small businesses to help.Small business is the key component of Ontario’s economy. I understand how difficult running a small business can be. I ran a small business in Oxford for nearly 30 years, but I never had to endure some of the hardships that the small business owners today experience.


Since the summer of 2011, the government has increased hydro rates four times, the latest increase coming later this week. For businesses that are struggling to make ends meet or for entrepreneurs who are trying to start a business, every dollar counts. These hydro increases can singlehandedly limit the growth and even cause small businesses to fail.

The most recent hydro increase is a direct result of wasteful spending and the Green Energy Act. The government pays other jurisdictions roughly $500 million to use excess energy Ontario shouldn’t have produced. They wasted $300 million by giving wind priority over hydro and another $180 million in wasted nuclear efforts. Couple that with the $1 billion lost in relocating gas plants, and it’s no surprise that hydro rates are forecast to increase 46% by 2017.

It’s no surprise that 97% of Ontario’s farmers reported that they are affected by the recent increases, and 60% of Ontario farmers reported that their operations would be significantly impacted. The point is that increasing a tax exemption for small business by $50,000 is nowhere near enough when the government is increasing operating costs for those same businesses by a lot more.

Try and tell the farm supply stores in Oxford that they’ll have to pay more just to stay open from 9 to 5. Then tell them, when they finally get home to make dinner, do the dishes and laundry, that the increases are high even for non-peak hours. Business owners are already doing all they can to save costs, but there’s no escaping the hydro increase.

Mr. Speaker—and welcome to the chair—the Premier’s telling agribusiness to double the rate of growth of their output, yet the Premier has done nothing to address the high price increases in their inputs. These entrepreneurs need government action that addresses the larger problem affecting their bottom line, not minor concessions.

It’s not just hydro rates. Another large burden on a small business owner is red tape. There are over 380,000 regulations today on small businesses. How is a shop owner, already working tirelessly for every dollar he or she makes, supposed to set aside time to comply with all these different regulations? Every moment that a small business owner spends dealing with red tape is a moment they spend losing money.

Now the members opposite actually claim that an added benefit of this bill is that larger employers won’t have to fill out an employer health return. That’s not real action to address this. Now, these larger employers they’re talking about are those that will move from $400,000 to $450,000, and they will not then have to fill out one form.

I think it’s amusing that eliminating one of the 380,000 regulations is a selling point when small businessmen and women of Oxford and Ontario can’t afford to deal with all the regulations they have. If the government were serious about helping small business owners, they would focus on eliminating unnecessary red tape.

Just last month, the Alliance of Ontario Food Processors released a report detailing their business strategy for the upcoming year. In the report, they list a major obstacle to success as the high and unavoidable costs resulting from increases in energy, water and waste management, making it less attractive to invest in this province. The AOFP also goes on to discuss the regulatory burden that often obstructs growth initiatives, investment and speed to market.

The Canadian Federation of Independent Business is all too familiar with these problems. In fact, in January, they will be promoting their fifth annual red tape awareness week. Red tape suffocating small business is a massive problem. The CFIB reported that 68% of farmers and 62% of small business owners are discouraged from growing their businesses, while another 28% of farmers claim that they may not have gone into business if they had known about the regulatory burden. On average, an Ontario farmer spends nearly four standard 40-hour workweeks filling out government forms. Can we seriously expect these businesses and farms to succeed with such an amount of regulation?

The red tape affecting small business at times is almost comical. The CFIB reported in a story January this year about an Ontario small business owner and her ordeal with red tape. After filling out two mandatory statistical questionnaires in the same week, she received a third form asking how she felt about filling out government forms. You can’t make this stuff up: three in one week.

It’s disheartening to know the challenges that small business owners are facing. I know how hard small business owners work. These people are some of the most dedicated workers in the province.

Just this month in my riding, the Ingersoll District Chamber of Commerce handed out the 2013 awards of excellence. The winners included Bob Shelton, Maggie Carter, the Elm Hurst Inn and its general manager, Alon Gurman; Conestoga College; and a local entrepreneur, Dale Hurley.

Dale Hurley is a prime example of a dedicated small business owner. He started off sorting pop bottles and expanded to open his own grocery store in Ingersoll. That family store soon expanded over the next 38 years into a superstore that employs 185 people. I want to congratulate Mr. Hurley on his success.

These winners are just a few of the dedicated and hard-working members of Oxford’s business community. It’s a shame that despite their continued work and success, they have to deal with the recent hydro increases and the constant regulatory burden.

Dedicated small business owners like Mr. Hurley who have worked their entire lives to grow their business aren’t helped by this act. Everyone in Ingersoll knows that Mr. Hurley is a perfect example of a small business, yet he is not eligible for this benefit. Some smaller businesses may be eligible for a slight increase to the employer health tax exemption, but if these larger problems are not addressed, there will be no one to exempt. Raising another sail doesn’t do any good on a sinking ship.

Small businesses are being attacked by the government on all fronts. Higher hydro rates and excessive regulatory burdens are just some of the issues facing shop owners. A more recent development deals with the Workplace Safety and Insurance Board premiums. Owners used to pay for their own insurance to make sure that their families were protected if they were hurt on the job. Now these same owners are forced to pay more premiums for less coverage. These owners are forced to choose between their original policies they paid for for years or larger WSIB payments forced on them by the government.

Issues like this need to be fixed. Small business owners cannot afford to pay for the mistakes of nearsighted policy.

Right now, times are tough. Small business owners have to be creative to make ends meet. Because of the barriers to small business that exist, that creative spirit could mean moving to another province. We’re at a point where businesses are having too much difficulty trying to survive in this province. Because of this difficulty, I’m eager to see the government’s fall economic statement.

When you change the rules of the game, you change the way the game is played. If the act is passed, companies near the $5-million payroll cut-off will intentionally keep their payrolls below $450,000. The 60,000 employers that will now be covered by the exemption will have no incentive to grow any further. This act will simply stop the growth of Ontario businesses. If the government truly wanted to support small business, they would consider doing so by lowering hydro rates and easing the regulatory burden on these hard-working men and women.

The increase in the employer health tax exemption is a band-aid solution to a systemic problem. I believe that the people of Ontario and small business owners in this province expect the government to put forward a real plan, not just a bill with a good name that does very little to actually help.

Thank you very much, Mr. Speaker, for allowing me to speak this afternoon.

Mr. Ernie Hardeman: I do want to thank the members from Davenport, Ottawa–Orléans and Northumberland–Quinte West for their kind comments.

I also want to mention the member from Timiskaming–Cochrane, who mentioned the different vantage point in which he was sitting when I was making the presentation. I would point out that it may be the first time that, because of his duty, he actually had to listen to me. I’m glad to hear that when he did that, in fact, it wasn’t a negative that came out of it. I’m quite pleased to hear that he actually listened and maybe even appreciated what I said. So I want to thank him very much.

Mr. Speaker, I spoke a lot about the difficulties with this bill—not so much what’s in it, but what isn’t in it and what it doesn’t do. It’s such a small part of the challenges that small businesses are facing.

I think we really need to look at what the government is going to do, moving forward, to actually help small business, and I think the first opportunity when we can see that would be the fall economic statement. It’s crucial that this statement include a plan for the economy of Ontario and specifically for small businesses. Hydro rates need to be addressed, the regulatory burdens need to be reduced, the books need to be balanced, and a vision to create jobs and further the economy of this province needs to be put forward. The best way to encourage investment in the province is to lead by example. The fall economic statement should be the time to set that example with a strong plan, with a vision to the future. I think that’s really where we need to go here.

It’s one thing to banter back and forth here about whether we should be debating this bill, whether we have a right to speak our minds here or whether we should move along—I would have thought that this debate could have been completed more equitably if we had actually had a debate from both sides so we could discuss where we were going, instead of just standing here pointing out what’s wrong with it. We have nobody here coming across and defending it and putting the defence for this position.

I think we really need to look forward to some better action to help small business across the province of Ontario, from this government.

Second reading debate deemed adjourned.