The House resumed from April 16 consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the second time and referred to a committee, and of the motion that this question be now put.
Hon. Garth Turner (Halton, Lib.):
Mr. Speaker, politicians are citizens that other citizens nominate and elect to represent them and their interests. As such, the bond between them is quite simple: it is called trust.
If and when that bond is broken, there can be no greater disconnect or breach or falling out or betrayal between them. The people are no longer represented. Instead, I would say, they are ruled.
Today we are debating the implementation of the 2007 federal budget, a document that affects the lives of millions of Canadians in thousands of different ways. Some are beneficial and some are not.
My remarks concern themselves today with just one aspect of this and that trust I mentioned between politicians and the people. It is at the very heart of what I wish to say.
In the last election campaign, the man who is now Prime Minister of Canada said over and over again from podiums from one end of this country to the next, including in my area, that a Conservative government would not tax income trusts.
He put it in writing in an op-ed article in the National Post. He directed that it be published in the party's platform, called “Stand up for Canada”.
In short, the man who is now Prime Minister could not have been clearer in his messaging to income trust investors, many of whom are seniors. He told them to relax, saying they would be safe if they voted for the Conservatives because, unlike the Liberals and the NDP, the Conservatives would never attack their income trusts.
Now we know that he lied. The government brought in a tax on income trusts on October 31 of last year, which tanked the stock market and erased $25 billion--
Hon. Garth Turner:
Thank you, Mr. Speaker. I withdraw the accusation.
The Prime Minister said one thing and did another. This actually caused investors in this country to lose more than $25 billion in private savings. Most of those people were retired. They could not possibly and will not possibly be able to recoup these losses.
It is the biggest single erosion of private savings ever caused by a single government action.
With that one draconian and, as it turned out, stupid, costly and senseless action, the Conservative leader broke faith with the people. He breached it. He destroyed it. He threw it away.
He is no longer representing the income trust investors whom he asked to vote for him. Now he is ruling them. He is telling them that they must live with the gratuitous pain the government has caused. Now, with this bill, the government seeks to make this breach of faith the law of the land.
That is why I voted against the budget and why I cannot support this enabling legislation. Shame on those who wrote it and seek to impose it upon Canadians.
Today I am not going to add any more of my words to the debate. Instead, I will turn to those of average Canadian investors.
This week on my blog I mentioned that I would have the opportunity to stand here for a few minutes to speak about this issue. I asked individual Canadians if they would send me some messages they would like conveyed to the House. I was overwhelmed with the response.
I would like my hon. colleagues to listen for a couple of minutes to some of the messages.
Mr. Don Bool, of Courtenay, British Columbia, wrote:
|| For me it's not having the proof of tax leakage. The blacked out pages by the finance department pretty well says it all. I could live with changes to income trusts if it was proven they were not good for the Canadian economy. Just give me good reasons for changing income trust policy and I'll eat the loss. I didn't know much about the particulars of income trusts but when they presented blanked out pages I studied up on trusts and a simple person like me could see the fix was in. I have been taken for a schmuck.
Ron Murray said:
|| I am a senior citizen that dropped some $30,000 because of the [Minister of Finance's] complete misunderstanding dealing with income trusts. No discussion, no notice, lying to the public--
Sorry, Mr. Speaker. I mean to say “saying one thing to the public and doing another”. Mr. Murray continues:
||--refusing to give the background of his numbers on the 'tax loss'.
Mr. Murray said that he sent a letter and states:
|| I sent a copy to my local MP and was called by him. I went to his office and was muzzled with [the] party line...I am not sure he had a clue what an Income Trust was. The main reason according to [the member of Parliament opposite] was that we were the only country in the world that did not tax income trusts.
Mr. Murray says phooey.
Then we have Tom and Ethna Anderson, who said:
|| The current government broke its promise not to tax income trusts. These actions have seriously lessened our confidence in the government's ability to govern with honesty and integrity.
Donald Metcalfe of Hanover, Ontario, said:
|| My wife and I are devastated by the damage the decision of the government to tax income trusts has done to our investments and to our monthly income. We are both seniors and rely on this income...we are down more than $1,200 per month. This is robbery and has affected our living in a major way. I talked to our [Conservative member of Parliament] and he told me [the Prime Minister] would allow him and his fellow MPs no say so why do we elect MPs to represent us when [the Prime Minister] is a dictator.
Again, in sympathy, Mr. Speaker, I will not name the member.
Elmer Sather of Surrey, British Columbia, said:
|| I am speechless, and in shock over how fast these Income Trusts are being taken over by foreigners.
He said it is staggering.
The Martinson family said that the Prime Minister told people something and did something else, although they used a more descriptive term. They wrote:
|| The government has successfully made it sound like they get no tax money from businesses involved in the Income Trust structure and people seem to be buying this. I feel it is important that it be made clear to the Canadian public that Governments gets lots of tax money due to Income Trusts.
As of March 31, the Martinson family reminds us that the Canada pension plan had 80 individual income trust businesses in its portfolio. If it was such a bad idea for individual citizens to hold income trusts, as the government would suggest, how could our public pension plan have invested in 80 of them?
Bill Fischer says this in regard to the Secretary of State (Multiculturalism and Canadian Identity) who had a town hall meeting in his riding the other day on income trusts. He said:
|| I attended and here's my comment:
|| “We worked hard to elect a Conservative government, and were rewarded with betrayal. [The Prime Minister] promised one thing and did another. A 35 billion dollar--
I will not use the word--
||--action. Calling manure a rose doesn't change the smell”.
|| [The secretary of state] spoke a lot of “rose” at the meeting, but few were fooled. He and [the Prime Minister] need to listen to Ralph Klein and recant, repent, and reimburse investors and seniors. You can't reward...politicians by voting for them [when they do not tell the truth]. It encourages them to continue the practise.
I have another comment here:
|| I don't remember reading in the party's platform anywhere that you had decided to decimate the nest egg of hundreds of thousands of senior Canadians. This is despicable behaviour from a government that touts itself as being accountable. To whom?
Art Moss, another senior says,
|| My RRSP took a 25% haircut in the aftermath of the Halloween massacre. It has since recovered about 10%.
|| However, the real pain of this legislation will come in 5 years when I convert to a RRIF. If all goes according to plan...I was projecting distribution income of $2,000/month.
He goes on to say, “the Minister of Finance calls this tax fairness. There is nothing fair about it”.
Mr. Speaker, I have probably 400 comments here. Could I have a couple of hours? If I could get unanimous consent from the House to continue to table these comments from individual Canadians, I would be a very happy guy because I would be able to tell these Canadians that I came here and stood here today, and actually got their voices to the floor of the House of Commons. Could you ask for that consent, Mr. Speaker?
Ms. Catherine Bell (Vancouver Island North, NDP):
Mr. Speaker, I would like to begin my remarks today by painting a picture for my hon. colleagues about how this budget fits into the overall course that Canada seems to be taking under this Conservative government. This course is guided by its not so obvious agenda and if members read between the lines, they will see that it is there.
This agenda is also driven by five priorities: one, help the rich get richer and pretend the prosperity gap does not exist; two, privatize at all costs, including municipalities and their infrastructure; three, treat first nations with disdain and ignore their advice; four, invest as little as possible in social programs, no matter how big the surplus; and five, ignore the crisis situation in the forestry sector.
This Conservative agenda masquerades behind what it likes to call the harmonization of inefficiencies. This language is often used by the right as a kind of code. To the rest of us, harmonization of inefficiencies loosely translated means the alteration of policies to the benefit of rich corporations and to the detriment of ordinary Canadians.
This policy change ignores the ever-increasing prosperity gap, environmental conditions, food safety concerns, health care services and the control of our natural resources. Furthermore, this budget offers deep integration with the U.S. at the cost of our sovereignty.
This agenda of privatization by stealth has been going on for many years. This path has seen the rich get richer and the rest of us get the leftovers.
This budget is nothing short of deceiving. While the Conservatives beat their chests about standing up for Canada, their actions suggest quite the opposite to hard-working families. While they talk about a stronger Canada, they intentionally attack our public institutions; thereby, eroding the foundation of an independent Canada.
Allow me to elaborate more clearly what I believe the government's real priorities are. Priority number one: ignore the widening gap between the super rich and ordinary Canadians.
Surplus after surplus of hard-working Canadians' taxes have gone to tax cuts for large corporations. These surpluses subsidize the development of the oil sands at a time when the industry is making record profits. It gets to continue to receive subsidies until 2015. That is six years before it even starts to see a phase-out. But no money from the federal budget went to the thousands of Canadians whose families are looking for affordable housing.
In fact, affordable housing was not even mentioned in this budget. So, how is it that a profitable corporation can continue to receive subsidies but ordinary families are ignored? The gap between the rich and the poor in this country is widening and this government has no plan to correct it.
Priority number two: use privatization as a mantra for change. How do we start the process of privatization? First, we need to set up shop.
On page 162 of the budget, it states this government will, “establish a new federal office to identify and implement opportunities for public-private partnerships in infrastructure”.
Step two, then we have to make it mandatory. On page 169 of the budget, it goes on to state that municipalities, “seeking funding...will also be required to demonstrate that the option of undertaking the project as a public-private partnership has been fully considered”. This is simply bad policy and a waste of Canadians' money.
We have seen the experience of public-private partnerships when companies take over a public project. The focus shifts away from the public interest and meeting community needs to ensuring profit for the company's shareholders. Maybe the Conservatives should have consulted with the Federation of Municipalities who believe that this government should not be forcing a one size fits all policy down their throats.
Mandatory P3s are not the only privatization at play. People in Vancouver Island North, in my riding, are very concerned that this government is trying to privatize one of the largest common property resources in the country: our fishery. While it may not be part of the budget, the fact that the bill was introduced with no consultation with fishermen, lodge owners, recreational and sport fishermen, first nations or anyone else is a huge concern in my riding.
Then there is the issue of our forests. We in the NDP have spoken at length about the softwood lumber sellout and now we are seeing the result of that bad deal: raw logs exported at an ever-increasing rate and the government not willing to take a stand and implement a made in Canada policy to protect jobs in our communities.
Priority number three is that the Conservatives went out of their way to exclude first nations from the budget. This is one of the most outstanding and offensive omissions I have ever seen.
I have been meeting with many of the chiefs in Vancouver Island North over the past couple of weeks to talk about the budget. We have also spoken about many other issues of concern to their communities. The level of frustration and anger they are feeling because of what is lacking in the budget is very high.
The government announced $300 million for a housing initiative that allows them to buy their own homes, but it is a reannouncement of old money, nothing new. What the chiefs want to know is when they use the $300 million for housing and there is no new money, what programs they are going to lose to have to pay for it.
There was nothing in the budget for land claims and treaty settlements. First nations are ready to settle. They want to move forward for their communities, for their economic well-being, but they cannot because the government says it does not have a mandate to settle. The government underlined that in the budget by not putting any money in it for land claims.
Priority number four is that no matter how big the surplus, no matter how well our economy is running, the Conservatives invest nothing in social programs. This particular priority hurts every community and quite often the most vulnerable in our society.
A reintroduction of the same money the Conservatives introduced last year for child care, $250 million, will not help build a national child care program. That program would be helping ordinary working families and parents with escalating child care costs and a lack of spaces.
There is nothing in the budget for the arts. There is no mention of culture. It is not even on the government's agenda. There is nothing for art programs for kids and communities, nothing for artists and sadly, nothing for museums. There is nothing for pharmacare, home care or long term care for seniors. There may be some old money to address wait times, but the government said that last year and wait times actually went up. These programs are what made Canada a great country; at least my Canada includes them.
Priority number five is to pretend that a crisis does not exist in the forest industry. On the contrary, the current state of the lumber industry is a perfect example of how Canada is losing on trade with the U.S. The steady creep toward free trade and further harmonization at any cost is hurting this country.
Our timber mills are closing. Over 5,000 jobs have been lost since the softwood lumber agreement was signed. Ask the mill workers in my riding who have seen their jobs and their logs get trucked over the border on a daily basis. “Did this government stand up for Canada?” they are asking. I say no. Instead, in a rush to placate their Conservative counterparts in the south, the Conservatives ignored five international trade rulings in favour of Canada. They signed a bad lumber agreement and managed to give away $1 billion in the process.
This whole mess was done in the name of harmonizing inefficiencies. What is so efficient about losing jobs? The Conservatives may have made harmony with the U.S., but they sure left a heck of a mess behind in their wake. And to add insult to injury, the budget provided no funds to help struggling communities when our mills are closing.
The government cannot just ignore these problems and hope they go away. It has to take action to help these communities. The government has to stop exporting raw logs from federally regulated lands. Then it needs to clean up its act by providing aid and a comprehensive plan to help these communities and stop mill closures. But there is no plan. There is no stabilization funding. It cannot be found in the budget. The government needs to start making decisions that actually help hard-working Canadians.
As a former labour representative, I understand the intent of these policies. Their point is to undermine local democracy and allow private corporations to benefit from government contracts. That is it. The result is there is a steady race to the bottom in the quality of work being completed while municipalities struggle to accommodate more and more needless bureaucracy.
While the government beats its chest about standing up for Canada, ordinary Canadians are beginning to recognize that the truth speaks louder than words. The truth is the prosperity gap is growing. The truth is our communities, infrastructure and natural resources are being privatized. The truth is first nations are being ignored. The truth is investment in social programming is abysmal. The truth is the forest sector is in crisis.
Canada's corporate CEOs are getting richer and richer. Ordinary hard-working Canadians are being left in the dust. They deserve better. They deserve fairness, and the budget does not deliver it. For those reasons, I cannot support the budget.
Hon. John McCallum (Markham—Unionville, Lib.):
Mr. Speaker, I am very pleased to speak once more to the budget. I thought I would use my time to focus on two items in the budget, which have been the recent focus of attention, income trusts and the interest deductibility provisions. I also want to use part of my time to show the linkages between those two.
The first point to make, which has been made before but it is so fundamental that it cannot be said too often, is that the income trust tax was a massive broken promise. The Prime Minister said, in words that could not have been clearer, during the election that he would not tax income trusts. On the strength of that solemn declaration, hundreds of thousands of Canadians took the Prime Minister at his word, put their life savings into income trusts, knowing that there were market risks but confident that there were no political risks, because the Prime Minister of the land had committed himself in unequivocal fashion to not tax those income trusts.
On Halloween of last year, when he absolutely and totally broke that promise by imposing a draconian 31.5% tax, he cut all those people off at the knees, caused a $25 billion meltdown of the hard-earned savings of those Canadians, many of whom are seniors who depend on the proceeds of their savings to pay the bills. The error was not simply the broken promise, but it was the incompetence of the manner in which that promise was broken. This is the first parallel between the income trust decision and the deductibility decision.
The finance minister has a tendency to go nuclear. When he sees a problem that might be a little problem, his tendency is to drop a nuclear bomb on it. He does not consult, he just drops the bomb and then finds out afterward what happens. A far more sensible approach would be a surgical approach; look at the problem, isolate the problem, consult before acting and think before acting. He does not think it through, but drops a nuclear bomb, lets it explode and then deals with the consequences thereafter.
Just yesterday he said, on the subject of deductibility, that he would spend some time on it now, some weeks after the budget. Why did he not spend some time on it before he made that decision? Instead of destroying $25 billion of consumers wealth, why did he not spend some time on thinking it through before he took that ill-fated action last Halloween? It is a bit late to start to spend some time on it now.
My point about the surgical nature of the operation in the case of income trusts is that what he should have done, and he had the information at his disposal, was to follow the Liberal plan, which says not to impose a 31.5% tax. That is absolutely unnecessary, draconian and it causes a $25 billion meltdown in Canadian savings. What we would do, and what we will do if we come to power, is impose a 10% tax, not a 31.5% tax and our tax would be refundable to all Canadian residents except non-residents who would have to pay the tax to ensure that they would pay a reasonably full share of the tax burden.
There are three positive effects of this alternative Liberal policy. Some intelligent people in the finance department could have told the minister this. It is not rocket science. Had he done our much more moderate, surgical, non-nuclear approach first of all, some two-thirds of the $25 billion lost to ordinary hard-working Canadians would have been returned to them through the markets under this Liberal plan.
Second, seniors in particular, who have need of a high yield instrument in order to get a return from their savings to pay the bills, would not be deprived of this income trust instrument, which is what is in the process of happening under the government's budget.
Third, the energy trust sector, which was a vibrant sector contributing to the nation's productivity according to the governor of the central bank, would have been allowed to continue to thrive under the Liberal plan.
Before Halloween, the energy trust sector was repatriating foreign capital. It was a net acquirer of foreign assets. Right now, it is sitting on its back, at bargain basement prices, being gobbled up by U.S. companies that are still subject to the tax rules that our Canadian energy trust was subject to prior to Halloween.
This is hugely damaging to a vibrant, highly productive sector in Alberta and it is hugely counterproductive to thefinance minister's stated goal. The finance minister's stated goal was tax fairness, that ordinary Canadians should not pay more than their share of taxes.
Let us think through, logically, the consequences of his actions. It was imminently predictable at the time of his decision that these energy trusts in Alberta, and other income trusts, would be for sale at bargain basement prices and that foreign entities, notably private equity companies, would come in and buy them up.
What does that do to the necessity for ordinary Canadians to pay taxes? Logically, it means that ordinary Canadians will have to pay more tax, not less tax. Why? Because under the previous structure, income trust holders were paying a lot of personal tax. Now what has happened is these private equity foreign companies come in, buy the assets and structure those purchases in such a way that they pay no tax. How does that save tax money? It does not; it does the opposite. It is not rocket science.
Previously, income trust unit holders were paying a lot of tax. Now the foreign entities come in, buy out those income trust holders and pay no tax. The net effect is the income trust sector is paying way less tax, and in many cases no taxes, than they were before. The public at large is going to end up footing a larger tax bill, not a smaller tax bill. Therefore, the fundamental objective of the policy, as stated by the finance minister, the opposite is in fact what is going on today.
There is a second way in which this is not fair.
First, the ordinary Canadians pay more tax because of the policy. Second, in the good old days, the pre-Halloween days, ordinary Canadians had access to this relatively high flow of income arising from the energy trust sector. Now the government says, no, that ordinary Canadians can no longer go there, ordinary Canadians can no longer participate in this revenue stream that is so important for seniors. However, the people with deep pockets can. If we had enough money to buy an oil field, we could still get those same benefits. Large pension funds can acquire those assets. Large private equity enterprises from the United States can achieve those same income streams, without paying any tax at all. That is unfair.
It was a revenue stream that was available to all Canadians, some with modest incomes, some with less modest incomes, in a democratic way. Ordinary Canadians cannot go there any more. Only the entities with the deep pockets and the big wallets are allowed to go there.
I will now come to the important point about interest deductibility.
This is a very important parallel between these two policies. What the government is doing with the interest deductibility prohibition is it is tilting the playing field in favour of foreign companies and against Canadian companies. Whether we look at Europe, the United States or Japan, all those jurisdictions have equivalent policies. Their companies, when they go abroad, can deduct the interest on debt. Canada's companies can no longer do that. Our companies are weakened relative to companies from the U.S., Europe and Japan.
Why would the Minister of Finance and Prime Minister wish to tilt the playing field in favour of the foreign companies and against the Canadian companies? It is a totally erroneous policy. It is anti-competitive. It is exactly the same as what the government has done with the energy trusts. The U.S. equivalent of energy trusts have the same favourable tax treatment.
The government has tilted the playing field in favour of the U.S. companies both for energy trusts and in general. It has moved against Canadian companies. Canadian companies for competitiveness, for jobs, for prosperity need to expand abroad and the government has attacked that ability to the gain of foreign companies.
I do not have to remind the House of that great Progressive Conservative Peter Lougheed. He has spoken out against the dangers of the hollowing out of Canadian companies, a message that the government has totally ignored.
Mrs. Irene Mathyssen (London—Fanshawe, NDP):
Mr. Speaker, I would like to take this time to talk about the impact of the budget on the housing crisis in Canada and its impact in my riding of London—Fanshawe.
With the growing homeless crisis in this country and the cost of housing on the rise, there is a definite need for more investment in affordable housing. With over $9 billion in budgeted corporate tax cuts, we know that there is money available and that it should be available for the vulnerable of this country but, sadly, there is no new money for affordable housing or homelessness in the recent federal budget.
The budget made it very clear that the housing of our citizens is not a priority for the government. In fact, the number of times homelessness was mentioned in the budget was zero. This is shameless. With over 200,000 homeless people in this country, there is not a single mention of their plight. How can we begin to address the problem when it is clear that the government does not even acknowledge that there is one?
We should just imagine having no family support, no income and no place to call home. The bag containing all of our worldly possessions was stolen last night. We are too sick to get a job. We have been abused and rejected. Our last meal was a bowl of soup two days ago. We do not know where our next meal is coming from. We have not had a change of clothes or a warm bed for a week. The Conservative budget does nothing to help the most vulnerable. There is no money for housing.
In the current federal spending estimates, overall spending on housing and homelessness by Human Resources and Social Development will drop in 2007-08 by more than $44 million from the spending of 2006-07. In the federal spending estimates, funding for assisted housing will drop by $391 million. Again, in the same federal spending estimates, funding for affordable housing dropped from the $800 million budgeted last year and put in trust for the provinces, to $92.8 million this year.
There is no new money for northern housing or off reserve housing in the 2007-08 budget. The budget document only highlighted the $300 million for northern housing and the $300 million for off reserve aboriginal housing that the NDP secured in the 2006-07 budget.
New Democrats want a real, substantial investment in affordable housing and we need to see investment in our current housing stock. We can easily create more affordable housing by increasing federal support for co-op and non-profit housing that already exists in Canada. This investment will provide an opportunity for co-ops to offer more subsidized units, complete much needed maintenance for current units and to proceed with purchasing or building new affordable housing units.
In addition to the current spending, we also need a federal housing program with secure ongoing funding every year. This program can be funded in part or in whole by the surplus generated from the mortgage insurance collected by CMHC. What is needed to truly address our housing crisis is an investment of $2 billion in a federal program each year and the CMHC surplus can achieve this.
An investment in long term core funding would benefit communities across Canada. In my riding of London—Fanshawe, the need for core funding is critical. Over the past year I had to write letter after letter and request meetings with the minister to alert that minister to the fact that organizations that assist homeless people or those at risk of homelessness were closing down. After much pressure, the government started to approve programs.
As we neared the end of the year, organizations again started to scramble as the main funding program, SCPI, was about to end. After many more phone calls and letters, a new program was finally introduced and, with further pressure, SCPI was extended for another six months.
The problem now is that organizations and programs are facing closures. Federal dollars for homeless programs have been so poorly administered by the government and so lacking in long term commitment that local service providers and community members are forced into a cycle of crisis management.
Under the new program, there will be far less money for London area organizations. It is not clear what the new program will look like or if organizations that received SCPI in the past will qualify for the new program funding. As it stands, eight projects addressing homelessness and poverty in London may soon be closing and over 2,000 of our most vulnerable citizens will be put at risk yet again.
The worst has happened for some and the clock is ticking for others. This includes the following programs.
Street Outreach London East will no longer be picking up messages. As of March 31, 2007, it had to shut its door.
The London Housing Registry can sustain one full time staff person until September 30 and will not be able to provide the housing access services that it once was able to offer. Its operating budget has been affected by unstable funding.
The bridge funding and donations My Sister's Place has received will only hold the agency over until September 30. After that it will need to close its doors. It will continue to generate some revenue from donations but it is not enough support and no one can depend on it.
The money the AIDS Committee of London will receive will hold it over and its “closet for tears” program for three to four months. The program, which services at risk youth and those at risk of homelessness, will shut down at that time. Eliminating this program will put more vulnerable young people at risk of contracting AIDS.
The Youth Action Centre organization offered an outreach program for homeless youth and those at risk of homelessness. This program is due to shut down September 30 and the single staff position eliminated.
Because the funding took so long to come for Nokee Kwe during the 2006-07 fiscal year, it had to cut back two of its three staff. The organization is down to a single person and, with its current funding, can only hope to survive another six months. After that program shuts down entirely, the outreach, prevention and advocacy for homeless aboriginal people in London ends.
The bridge money for the London Community Resource Centre will only help sustain the program cultivating communities for another three months. This program sets up collective kitchens and community gardens, relying on student involvement from the community college to run the program as it has not been able to find money for a full time development position. This, of course, will make it very difficult to sustain the project on a long term basis.
All of those organizations run on a shoestring, with skeleton staff. In the past year they have been given the runaround and left in limbo. This adds unneeded stress on the staff and leaves less time for them to do the actual work of helping others in the community. How on earth are they supposed to be effective and efficient? How are they supposed to plan for the future? How are they supposed to help people when they are spending all their time worrying about an imminent shutdown?
We all know that a good business model has planning and efficiencies built in. It is the government funding formula that is preventing this good business practice. People are spending more time filling out forms for funding than doing the important work that they set out to do, the important work that alleviates suffering and strengthens our communities.
This budget clearly does not address any of the problems faced by these organizations. In London and in other communities across Canada, we face the same challenges. The government has not and does not put enough funding into securing adequate housing for Canadians, nor does it sufficiently fund homelessness prevention. Instead, the government makes what little money it makes available to address homelessness almost impossible for organizations to access and use efficiently and effectively.
The budget not only fails Canadians, it fails the homeless. It is time that the government remembered that it was elected to serve Canadians, not the bankers, not the corporations, not its well-heeled cronies, but the hard-working and deserving people of this country. I truly hope the Conservative government comes to realize this soon for the sake of constituents, for the sake of our communities and for the sake of all Canadians.
Hon. Michael Chong (Wellington—Halton Hills, CPC):
Mr. Speaker, I was listening to the speech by the member from the New Democratic Party and it was full of factual inaccuracies.
One of the things she stated was that housing was not mentioned in the budget. I have the budget document here, budget plan 2007, and on page 91, just one of our many initiatives, the section titled “Housing in First Nations Communities”, it reads, “Safe and affordable housing is a basic need for all Canadians”. It goes on to state, “To this end, $300 million will be dedicated to the development of a housing market in First Nations communities”. That is the first factually inaccurate statement she made in her debate.
The second inaccurate statement was that the budget was full of “corporate tax giveaways”. That too does not make any sense to me because here we have the Liberal opposition criticizing our budget for putting a tax on income trusts and removing the deductibility of money borrowed by Canadian corporations for their operations abroad. We are receiving criticism from the Liberal opposition for other tax measures, such as the elimination of the accelerated capital cost allowance for the oil sands. These things are, in fact, not tax giveaways but quite the opposite. They are good for the Canadian economy, which is why we have acted.
I want to address the main point of her speech which was housing. As she knows, coming from London, Ontario, much of the housing is driven by municipal governments, locally owned and run, whether cooperative or non-cooperative developments, and many of these programs are facilitated by provincial governments in terms of affordable housing programs. To that end, our government has invested $39 billion in transfers to this.
Hon. Raymond Simard (Saint Boniface, Lib.):
Mr. Speaker, I am pleased to speak to Bill C-52, the budget implementation bill. It is always a pleasure to speak on a budget because when a government tables a budget, it affects all Canadians, obviously, but it affects directly people in a member's own riding.
The first thing I would like to do is to dispel a few of the myths around the Conservative government. I know that the Conservatives have been going around talking to people and telling them what good money managers they are, how fiscally responsible they are. The reality is that it was the previous Liberal government that cleaned up Mulroney's mess and got this country back on a solid footing.
I know that we keep coming back to the $42 billion yearly deficit but that is a reality that we picked up in 1993, and it is a reality of which Canadians are aware. However, when we left 13 years later, and I know they keep talking about our 13 years in government, we left the government with a $13 billion surplus and we set the basis for a second solid surplus this year. Even the Conservatives seem to be ashamed of taking credit for it because they know that it will not work. They know that Canadians know that the basics were set up by the previous government.
Prior to the last two surpluses, when was the last time that a Conservative government had a surplus? This is really interesting. Mr. Mulroney was in government for nine years. One would think that in nine years with a solid majority government he would have had an opportunity to do what he had to do and basically come up with a surplus, but not at all.
Let us go back to 1958 and the Diefenbaker sweep. Mr. Diefenbaker swept the country. I am sure that he had an opportunity to get the House in order and have a surplus, but no, absolutely not. In fact, the last Conservative surplus was in 1912 under Sir Robert Borden, before the first world war.
The myth the Conservatives are trying to portray out there is that they are good fiscal managers, but I think that puts that to rest.
The Conservatives keep talking about the last 13 years of Liberal government. In the last 13 years of Liberal government we had seven consecutive surpluses. I could enumerate all the other amazing things that were done in that period to put Canada on a solid fiscal footing, which everybody in the country realizes.
The second myth is that they control spending, that they have really tight reins on spending. The Conservative Party has been spending like a drunken sailor. It is absolutely incredible what has been going on.
When the Conservatives were planning their budget they basically eliminated the $3 billion contingency that our party used to put in place when we were doing our budget planning. Old habits die hard. They are very close to incurring deficits. It looks like a return to the good old Mulroney days is just around the corner.
When it comes to announcements, and I think it is important to talk about them, I remember that a year and a half or two years ago, they were always saying how the previous government was making announcements and throwing money around. In the last little while in Manitoba it has been a whirlwind. People in the Conservative Party have been tripping over each other to make announcements. I have never seen in my five years here in Parliament so many announcements in so little time.
Hon. John McKay: Signifying so little.
Hon. Raymond Simard: Signifying so little, exactly.
I was just wondering why the Conservatives continue to call themselves Canada's new government. It just bothers me. After a year and a half, why would they do that? I think I have come up with the answer. They want to distance themselves from the Mulroney government. They want absolutely nothing to do with those people, which is understandable.
The income trust fiasco is another issue. A lot of members have spoken about it today. In my riding it has been a huge issue. People in my riding, most of them seniors, have lost from $50,000 to $80,000. This will go down as the biggest scandal in Canadian history. People may not realize it right now but $25 billion lost in a matter of hours is something that had been absolutely unseen before. Down the road historians will say that it was an absolutely horrendous move.
The Minister of Finance had all kinds of options but the Conservatives were in such a hurry to make a move on this that the Prime Minister and the Minister of Finance did not look at the options. All they wanted was to achieve their majority and do whatever they had to do to achieve that. Who pays for that? It is the 1.5 million seniors who were affected by it and who lost huge sums of money after the Prime Minister broke his promise on this.
The hon. Liberal member before me spoke to the fact that a lot of the income trusts were severely weakened and are now takeover targets. Normally there would be Canadian companies purchasing companies overseas and in the U.S., and there would be the reverse happening as well, other companies buying here in Canada and there would usually be a balance. We are told that in the last little while the imbalance is actually $100 billion and it is not on the right side. It is on the side of foreigners purchasing our companies. The Conservatives' policies are certainly impacting our country negatively.
Often, budgets are criticized for the things they contain. Some things were not in the budget and, in my opinion, that is often just as important.
I would like to say a few words about the court challenges program. In Manitoba, we were able to obtain the management of our schools and our own school divisions because of that program. Mr. Speaker, you are from Manitoba, so you will know that is important. It was only 11 years ago. In the riding of the President of the Treasury Board, there are tens of thousand of Francophones, and he was not even aware that that program was used to defend the rights of Francophones and official language minorities in Manitoba. Ever since the vibrant French-speaking community in Manitoba has taken control of its own curriculum. That is an important step that should be highlighted.
There was nothing for literacy in the budget. Some $18.5 million was cut and those funds have not been restored. In Manitoba’s Francophone communities, 11 literacy centres were closed and organizations such as Manitoba Literacy Partners are in jeopardy today. I find it insulting that the Minister of the Environment would say we should not repair something that is broken. We are talking about people here, not cars. Some people have not had the chance to learn to read or write. We cannot talk about people in those terms. I find that very insensitive on his part.
I could also talk about women’s groups, as well as the $10 million for “Santé en français,” a program that was not renewed, even though it had produced absolutely extraordinary results. They added $30 million to the total budget for official language minority communities. That is ludicrous. There are nearly two million Francophones living outside Quebec. They are making a laughing stock of our communities.
I would also like to point out that there was a reference in the budget to an official languages action plan with $642 million over five years. However, the official languages action plan should receive $750 million over five years. I hope that was a typo and not a $100 million cut that they tried to slip through. I would very much like to hear the government clarify its position on that subject.
On the environment, the Conservatives until a few months ago did not believe the science of climate change, until they saw the polls of course. All of a sudden, there was an instant conversion. The new Minister of the Environment bought a green tie. He thought that would do it. He thought that was enough to convince people that he had totally made the conversion. He ran over to Europe to tell our friends overseas that the Conservatives had seen the light, that the environment was suddenly important to them. The Europeans did not buy it and Canadians did not buy it.
An example of the Conservatives' false commitment to the environment can be found in Manitoba where their budget sprinkled $6 million over two years to clean up Lake Winnipeg. We cannot rake the sand on Lake Winnipeg for $6 million. This is absolutely ridiculous. What we need to clean up Lake Winnipeg, we are told by experts, is $120 million, and the last government had projected that in the last platform. That is the kind of commitment that needs to be made. The Conservatives cannot just say they are going to invest $6 million when they know it is not going to do the job. It makes one wonder if the Conservatives had a majority government whether they would even bother to show this newly found commitment to the environment.
There was not a word on the aboriginals in the budget. There was not a word on the Kelowna accord.
The Conservatives did do some things well. I think allowing corporations to write off their equipment faster is a good idea. I support increasing the capital gains exemptions to $750,000.
The Conservatives' best initiatives are when they basically reannounce past Liberal programs: EnerGuide; reintroducing the same funds promised on the Red River floodway; reintroducing the funds on the Sydney tar ponds; reintroducing the Liberal homelessness initiative under a different name; reintroducing $755 million to grains and oilseeds producers.
Overall it is a very frustrating budget for Canadians. It is a budget targeting their support for a majority government but not in the best interest of Canadians.
Hon. Michael Chong (Wellington—Halton Hills, CPC):
Mr. Speaker, I was listening to the member from Saint Boniface and I have a couple of comments.
I heard a similar refrain in this debate by the member for Markham—Unionville. It seems that the Liberal Party may be changing its position on foreign direct investment into Canadian companies and enterprises.
I heard him say, in a castigating way, in a way that was negative, that there was an imbalance, that over $100 million in net money had been invested in Canadian enterprises and businesses in the last while and that this was somehow a bad thing.
The Investment Canada Act is the act that governs investments by foreign companies and by foreign individuals into Canadian enterprises and companies. It has allowed for a significant amount of capital inflows into our economy, allowing for investments into plant, capital and equipment, and has really driven the Canadian economy.
I am wondering if the Liberal Party is now opposing the idea of Canadians investing in enterprises abroad and the idea of foreign individuals and foreign corporations investing in Canadian enterprises and businesses.
The second thing I want to point out with regard to the member's speech is the environment.
When I was 18 years old, I moved to Toronto in 1990. In 1990 and well into the early nineties, 1993, we had no smog days, none. Today in 2007, smog days are, day in and day out, a huge concern, as they were in 2006 and in 2005. There are dozens of smog days. The deterioration in the quality of air in Toronto happened under the watch of the previous government. All the while, while I was in Toronto I never saw--
Hon. Raymond Simard:
Mr. Speaker, I am sorry but I did not hear the second question.
With regard to the first question, no, we have not changed our position on this at all. We have always been in favour of companies purchasing Canadian companies and vice versa. What we do not want to do is handicap our Canadian companies in that process. When the government puts income trusts on their knees, when it devalues their worth and make them vulnerable to foreign takeovers, that is a totally different thing. That does not mean that we do not encourage purchases on either side.
I have a couple of quotes that are very telling from people who are very important. Allan Lanthier, retired senior partner of Ernst & Young and immediate past chairman of the Canadian Tax Foundation, said, “...the single most misguided policy I've seen out of Ottawa in 35 years”.
That is what we are against. We are not against the policy. We are against what the government has done to handicap our companies.
Mr. Claude Lamoureux, chief executive officer of the Ontario Teacher's Pension Fund, has indicated, “This is unbelievable. I don't know who in finance looked at this. I can't believe any sensible person would do this”.
Therefore, it looks like we are not the only ones who have a concern about this. We have put our companies on their knees. We can no longer compete fairly. Those are the things we are against. We are not against fair trade.
Mr. Tony Martin (Sault Ste. Marie, NDP):
Mr. Speaker, I am grateful for this opportunity to speak to the budget.
I profoundly believe that government budgets should tell Canadians much more than just dollars and cents. Budgets should also articulate and echo a nation's vision and values. We should spend and save according to our priorities as a country and as a people.
I must say at the outset how profoundly disappointing this budget is as a document for stating the priorities for a Canada that was built on rights and opportunities for all.
The Conservative budget has actually reminded me why I am a New Democrat. New Democrats believe in an ethic of care, compassion and justice for all. The Conservative spin doctors said that their budget was a family budget for the kitchen table, not the boardroom table. They certainly were not talking about most families or kitchen tables I visited in Sault Ste. Marie and Algoma.
Both in the last Parliament and in this Parliament, it has been my privilege, first as my party's child care critic and now as social policy and poverty critic, to travel across Canada and listen to people. In this past year I travelled across Canada to conduct a series of poverty forums that shine a light on the growing prosperity gap that divides our society and our people.
On a positive note, I have been impressed in communities by the deep level of compassion and caring that exists. However, people are increasingly uneasy about the disparity they see around them and their own tenuous grip on some security for themselves and for their families. Too many hard-working people and their families find themselves only one or two paycheques away from poverty.
People tell me they remember a time when community mattered and government could and did make a difference. People are looking for a vision consistent with the Canadian story where we together wove a safety net of basic income, health care, education, unemployment insurance and pensions for all.
Frankly, we will need more from the government than its tinkering here and there to fix our problems. We need more than the budget's baby steps forward on a working tax benefit that will not offer one cent to people on minimum wage who work full time.
We in my party are calling for a national anti-poverty strategy. I want to speak today about what the elements are for such a strategy. It would require the challenge heard by the Newfoundland and Labrador government in its poverty reduction consultation, a challenge to produce money and guts from elected officials.
We will not have to reinvent the wheel here. Jurisdictions in the European Union and elsewhere are proposing national plans to combat poverty. They are doing this with noticeable early success. In Ireland, for example--and there was a wonderful article in the weekend Toronto Star--the rate of people experiencing consistent poverty dropped from 15.1% in 1994 to 5.2% in 2001. The United Kingdom has taken a million pensioners and 800,000 children out of relative poverty since 1999.
Here in Canada there are promising initiatives in Quebec's anti-poverty law with a goal to achieve one of the lowest levels of poverty among industrialized societies by the year 2013.
Newfoundland and Labrador's poverty reduction strategy has a goal to have the least number of people in poverty in the country. In Newfoundland, a recognition that a poverty reduction strategy included but meant much more than just creating jobs. They looked at three key outcome areas: general well-being, employment and economic security and community stability.
For well-being, we are looking at health status in a the family: adequate nutrition; economic security; safety; access to early childhood programs, services and schools; post-secondary education and education status; and literacy. They will look at the redesign of policies and programs deliveries. They will look at income support; drug cards and who gets them; disincentives to work; coordination with federal policies; discrimination facing specific groups: women, persons with disabilities, seniors, immigrants, youth and aboriginals; and poverty influenced by the broad policy framework of government, federal, provincial and municipal governments.
The current framework creates disconnects in the continuum of supports as well as an imbalance of effort directed toward fixing problems rather than focusing on poverty prevention.
In Newfoundland there will be a new commitment to review every new piece of legislation or policy from a poverty reduction strategy lens to identify what works; sustained, stable, multi-year funding; universal access to programming; policy changes that remove barriers to support; accountability frameworks in federal-provincial-territorial agreements so policy intent is achieved to take in development and sustainability of rural communities; and disability related supports.
Even the World Bank has articulated a poverty methodology. Its major components are to explore individual and community well-being, to give priority to the poor in policy, to include institutional analysis and to always include a gender analysis.
In Canada there is a new movement across the country called “the vibrant community initiative” which has undertaken a significant poverty reduction strategy to create and grow a movement of diverse leaders and communities from across Canada who are committed to exploring, challenging and testing ways to unleash the potential of communities to substantially reduce poverty and ensure a good quality of life for all citizens. It is engaging business, citizens, groups and governments to examine alternative approaches to conceiving poverty and poverty reduction in order to strengthen the capacity of communities to make choices about how best to frame, unfold, measure and communicate about local poverty reduction efforts.
We as New Democrats have been looking at this issue of an anti-poverty strategy for quite some time. In partnership with the work that I am doing crossing the country and talking to people, we have a number of my colleagues in caucus who have critic responsibility in areas of housing, employment insurance, child care, post-secondary education, seniors, and the list goes on. Each one of those individuals are working with their communities and within their communities of interest to devise strategies that we can bring forward to the House, and we do that on a regular basis.
A skeleton for a comprehensive anti-poverty strategy, according to our caucus and the New Democratic Party in Canada, is already well on the road toward this with some of the following initiatives that we have laid out here in the House. We introduced private member's bills to begin the discussion. I myself led the discussion here on an opposition day only a month ago talking about the need for a national anti-poverty strategy beginning with the raising of the federal minimum wage to $10 an hour.
We are talking about EI reform, something that my colleague from Bathurst has talked about so passionately since he came here in the late nineties. We are talking about income security and the federal minimum wage. We are talking about child and family poverty initiatives. We are talking about seniors and a caregivers campaign.
We are talking about affordable housing and confronting homelessness, a problem that is becoming more and more alarming across this country and in places we would never expect, places like Calgary and Victoria for example, where the economy is doing well, where business is booming. We have a growing underbelly of homelessness that is alarming and it is creating great difficulty and challenge for those communities as they try to tackle it with little or no help from the federal government.
We are talking about affordable post-secondary education. We are talking about gender equality. We are talking about helping our veterans and their families. We are talking about persons with disabilities and introducing initiatives that will be helpful to them.
We are talking about our first nations, a group of people who we must fundamentally right our relationship with if we are going to develop a vision for this country. We need to honour our obligations to the Métis and Inuit.
We are talking about immigrants and overcoming the low income gaps that exist in our country. In that speech that I made about a month ago, I asked the House to entertain and to drive the development of an anti-poverty strategy and that we need to work together on this.
Too many of our friends and neighbours, too many of our fellow citizens out there, are counting on us to give leadership and to drop some of the partisan wrangling that has been heard here this afternoon and that so often takes over this place. We must work in concert as a team, together, as a government, to eradicate once and for all this terrible blight on our society, the blight of poverty.
Mr. Tony Martin:
Mr. Speaker, because I have heard it twice now from the members who have just asked me questions, I want to ask what it was about my speech they did not agree with.
Do they not agree that there is poverty in the country? Do they not agree that we need a national anti-poverty strategy?
As for the specific question in this instance about what the NDP thinks of this new disability tax credit the government is rolling out, first of all, again it will be something that those who have money will be able to afford and those who do not have money will not.
What we actually need is billions of dollars across this country for the literally hundreds of thousands of disabled people in every province who right now are struggling to make ends meet. Disabled people make up one of the groups that live in poverty in this country, groups that just cannot find a way to pay the rent, feed themselves, look after their children and live a dignified life in their communities.
They are crying to us as government. No matter where I went across this country to talk about poverty, one of the groups that came forward and spoke with me very passionately and knowledgeably about the challenges that face people in poverty in this country was the disabled group.
So yes, on the one hand, I would say good for the government for a tax credit program to help disabled people once a family moves on. On the other hand, with the billions of dollars we have in the surplus, why as a government are we not doing more for the disabled people living in poverty right now in Canada?
Mr. Sukh Dhaliwal (Newton—North Delta, Lib.):
Mr. Speaker, the Conservative budget is going to be remembered for a number of things.
Canadians are not going to forget the fact that the promise of large scale tax relief never materialized, amounting to a paltry $80 per taxpayer.
Canadians are not going to forget the government's failure to act on the environment by choosing to instead offer tax breaks and reductions in funding that will grow Canada's greenhouse gas emissions.
Canadians are also not going to forget the fact that federal program spending will rise by nearly 14%, or $24 billion, over the first two fiscal years of the government.
Today I want to talk about how this budget is the worst in a generation for the province of British Columbia and my constituents of Newton--North Delta.
The Conservative government has broken its promise and short-changed the Pacific gateway project by $44 million.
It has failed aboriginals by offering an insulting $21 million in new spending for the serious problems of poverty, substance abuse and widespread unemployment.
However, the action that is going to severely penalize British Columbia's exceptional growth is the new equalization formula for the provinces.
As a result of the budget, B.C.'s skyrocketing property values are now going to be included in the equalization calculations. My riding of Newton--North Delta, which is part of one of the fastest growing municipalities in Canada, is witnessing the trends that are going to make this single change punish B.C. for many decades to come.
In the recently released assessments of British Columbia property values, the city of Surrey's total assessment roll increased from about $50 billion in 2006 to $64 billion in 2007, a whopping 28% increase. In Delta, the total assessment roll rose by 21%.
British Columbia is experiencing a golden decade, and in the lead-up to hosting the 2010 Winter Olympics the province has become an engine that, along with provinces like Alberta, is helping to drive the Canadian economy.
However, as we all know, growth cannot continue forever, and there will be times in British Columbia's future when the prospect of an economic downturn becomes the new reality. Economies move in cycles and no province or territory is immune to these fluctuations.
In fact, this is precisely why the equalization payments exist: so provinces can be assured that regardless of the differences in annual tax revenues, program costs or economic slumps, every Canadian can expect a comparable quality of life.
Because British Columbia now has its property values working against it, that guarantee of equality is essentially over. Why? Because property values are continuing to rise at such an exponential rate, irrespective of the rate of growth in the province.
What this means is that B.C. will now surpass Ontario on the equalization ladder and will likely not be eligible for equalization payments ever again, not even in the worst of times.
British Columbia is being punished for its success by the Conservative government. It is clear that those on the other side of the House have absolutely no concern for this detail as long as they can achieve the political gain they seek so desperately by using the taxpayers' dollars.
But at what cost is this being accomplished? The Conservative government has carved this country up like a chessboard, picking winners and losers based on what will get it the most votes.
The fact is that the provinces are being pitted against each other as combatants. The fact is that inequality is being entrenched into the program that is supposed to ensure opportunity for all.
The fact is that this country is becoming a loosely constructed group of regional interests.
The fact is that this government just does not care.
In the budget speech, the finance minister made the following statement, saying that “the long, tiring, unproductive era of bickering between the provincial and federal governments is over”.
I am here to tell him that British Columbians wish this statement were true. Unfortunately, however, the short-sightedness of a government concerned with maintaining power at all costs has made that dream impossible.
The Conservative era of inequality and regional competition has just begun.
Ms. Dawn Black (New Westminster—Coquitlam, NDP):
Mr. Speaker, I am pleased to have an opportunity to speak to the budget today.
During the last election campaign, the Conservatives released a document in my province of British Columbia on December 17, 2005. They said that it was designed for the province of British Columbia. They called it “Stand up for B.C.” It looks like we may be on the brink of another federal election and today we can measure the Conservative Party's words in that document against its actions as government.
When we look at the track record, “Stand up for B.C.” was not a campaign promise. It was a warning that we would have to fight to convince the Conservatives in the House of Commons to do the right thing for the people of British Columbia. It was a warning that under a Conservative government we would have to fight to win fair treatment for working people and middle class families in British Columbia.
The Conservatives said that they would stand up for B.C., but instead we have been stood up and taken for granted. The so-called commitments in their document of December 17 to B.C. voters have a been a cruel hoax.
The Conservative government has failed to show leadership on the pine beetle crisis. The mountain pine beetle is destroying vast areas of forests in British Columbia, threatening communities, increasing runoff, increasing flood risks in the province and potentially harming salmon habitat.
The Prime Minister and the government made many promises and they have only really resulted in cuts. They cut $11 million from the mountain pine beetle mitigation program. The Conservatives have failed to support people who work in the forest industry in British Columbia. The special needs of B.C.'s forest industry and forest dependent communities were ignored in the budget, despite the deepening crisis and the high cost to working families when the Prime Minister caved in to Bush on the softwood lumber deal. There have been $.5 billion taken out of B.C. communities. Mills are closing, jobs are being lost and the government has done nothing to help.
It failed us in British Columbia on climate change. For too long the government and the Conservatives have followed the position of George Bush, with a head in the sand approach to climate change, ignoring the mounting scientific evidence. The Conservatives are actually more worried about appeasing the big polluters than protecting our children's futures and our environment.
The Conservative government has refused to support the communities that are hosting the World Police & Fire Games in the Lower Mainland of British Columbia. When these games were held in Quebec City in 2005, the federal government contributed $1.6 million to support this major event, but for the Lower Mainland communities, which are hosting the World Police & Fire Games in 2009, the Prime Minister says that there will be nothing for the British Columbia games, no funding, no help.
Events are taking place in my community at Mundy Park in Coquitlam and Queen's Park in New Westminster. These games bring emergency services personnel and their families from all across the world to Canada. They are a big income generator for the communities of the Lower Mainland. Once again, the government is failing the people of British Columbia.
It has failed to provide home care and long term care for seniors in this budget. The budget ignored the need to invest in home care to help seniors live in dignity in their own homes and the need to invest in long term care. If it had implemented those kinds of policies, it would reduce the pressure on expensive acute care beds in our hospitals.
The Prime Minister has failed to cut wait times for B.C. patients. The Conservatives promised a wait times guarantee, but it has not delivered much of a guarantee. It only covers one procedure per province and only guarantees that people will not have to wait much longer than they do already. It fails completely to shorten the wait lists.
The government has decided to support corporate concentration and not B.C. fishermen. It has introduced a new fisheries act that will weaken the already weak protection of the salmon runs and increase corporate concentration at the expense of ordinary fishers.
The Prime Minister has failed to respect the opinions of B.C. voters. The Conservative government made ringing declarations of accountability and respect for the opinion of voters, yet it has condoned and even encouraged floor crossing. There has been totally unaccountable floor crossing by members of Parliament, such as the member for Vancouver Kingsway who arrogantly superceded the voters' choice on election day and did it within hours after the last election.
The government has failed the people of B.C. by not replacing search and rescue aircraft in British Columbia. What do we have? We have 40 year old Buffalo aircraft. They are totally inadequate for our environment of the mountains, the ocean and for the people of British Columbia and the people who visit there. What does the government advocate? Stop gap measures to keep these old planes flying without the right kind of technology, the up to date technology. This is another failure for British Columbia.
The Conservative government has ignored the huge debt loads facing B.C. students. The budget ignored the need for improved access to education. Students from average families, if they can afford post-secondary education at all, must carry huge debt loads for years to repay the skyrocketing tuition fees. In fact, they mortgage their future.
The government has failed to act on representation and proportional representation. The Prime Minister promised a more equitable representation in the House of Commons to recognize B.C.'s growing population. He said that he would increase the number of B.C. seats from 36 to 40. He has failed to act on that promise too. He is stalling the NDP's proposal to bring in proportional representation so that every vote in British Columbia would count. This is another failure for British Columbia.
The Prime Minister has handed huge tax giveaways to profitable corporations. At a time of record profits by large banks and the big oil companies, the government shows what side it is really on by providing almost $9 billion in tax giveaways to large corporations, while working people and ordinary families are gouged at the ATM machines and the gas pump.
The government has poured billions into other provinces and failed to recognize the legitimate needs of British Columbia. The budget ended the nation of Canada at the peaks of the Rocky Mountains, cutting B.C. right out of Canada. Then the government changed the equalization plans. There are millions of dollars less for British Columbia and hundreds of millions for other provinces. The farther provinces are from Ontario and Quebec the less they matter to those Conservatives.
The government has also undermined child care for working families. The wait just got longer for working families that are already on long waits for child care. We need more accessible, affordable, high-quality child care spaces. The government has cut $1 billion from what was previously planned for child care.
The Conservatives have failed also to address the serious threat of massive flooding on the Fraser River this year. Snowpacks are away above normal in British Columbia, 50% in some cases above normal. There is concern that the runoff will be much faster from the forests killed by the pine beetle. First nations and local governments have expressed great concern about the state of the dikes, yet the government is doing nothing to reduce the threat of the worst flooding since 1948 in the Fraser Valley.
The government has backtracked on its promise to help leaky condo owners in British Columbia. The government has failed to understand the pressures in British Columbia of housing costs. We have the highest real estate prices and they are skyrocketing still in British Columbia. The government has done nothing to make housing more affordable for young people, for seniors or for working families. It has done nothing to help solve the growing problem of homelessness, which is a crisis in British Columbia.
The annual budget is one of the more carefully proofread documents presented by any government. It is a document where every government does its utmost to avoid errors or oversights. For that reason, the geographic error in the last budget truly underlines how far the people in British Columbia had fallen off the radar screen of the Conservative government.
Despite the claims in this budget, Canada does not end at the peaks of the Rocky Mountains and the Conservatives do not stand up for working families in British Columbia. Instead, they are focused on central Canada, where they hope to win seats by buying votes with this cynical budget. They have adopted a style of government that puts their own political interests ahead of the best interests of working families and communities across the country.
Hon. John McKay (Scarborough—Guildwood, Lib.):
Mr. Speaker, I want to talk about how the government has turned advantage Canada into disadvantage Canada. There are three policies that are so plainly wrong-headed and stupid as to make us wonder whether there is any adult supervision in the government.
The first one is the GST reduction. The Conservatives raised the taxes in order to be able to make the GST reduction. Is there anything more plainly stupid that one could think of? The second is the income trust policy. First of all, the Conservatives did not tell the truth about it during the election and then they went about it in such an incompetent manner as to blow away $35 billion of Canadians' savings. That is both stupid and dishonest. The third policy is the issue of interest deductibility for foreign acquisitions by Canadian companies. That is a stupid and deceitful policy. These three policies taken by themselves turn advantage Canada into disadvantage Canada.
Much has been said about the advisability of emphasizing consumption taxes in preference to income or capital taxes. Taxes are a fact of life. If we want the services we had better be prepared to be taxed; that is just the way it is and Canadians understand that. What they do not or cannot understand is why one would reduce a tax that does not improve productivity and increase living standards while simultaneously raising income tax which kills improvements in productivity and living standards.
The nation seems to understand this, but the government does not. The rationale is simple. When Canadians get income or tax reductions and capital, they invest or pay down debt. That in turn leads to reduced borrowing costs, which goes directly to the purchase of machinery and equipment, which enhances productivity and improves living standards. It is not much more complicated than that.
A consumption tax reduction, however, does none of that. It is just plain stupid. It is wrong-headed and it is against all the advice of all the best economists in the world, with one exception, the third rate economist who currently sits in the Prime Minister's chair. So much for advantage Canada.
It gets worse. Advantage Canada gets whacked again. The income trust deceit perpetrated upon thousands of Canadian investors was generating good returns for Canadians, huge revenues for the government and repatriating economic sovereignty. Millions of Canadians saw this as a good investment vehicle, until the sector was destroyed by the finance minister and the Prime Minister.
Not only were Canadians' savings destroyed, as predicted, these trusts became takeover targets. Sixteen have left the country already, representing $9 billion in capitalization since October 31, and more are under review. In fact in today's Globe and Mail there is an article which reads:
|| Foreign money snags three more trusts
|| Pace of deals unlikely to ease
|| Three more income trusts were thrust onto Canada's endangered list in less than three hours yesterday, raising to 16 the total number of trusts set to disappear with a value of more than $9 billion since Oct. 31.... Analysts and investors believe the furious pace of takeover activity is not about to ease. And the blame, they insist, rests with Ottawa's decision to clamp down on trusts.
Tell me how that is good for Canada. The minister argues, somewhat naively, that Canadians are acquiring assets at an equivalent pace while selling off Canadian assets, but this is where he is just so naive as to be almost dangerous. Having put a huge for sale sign on Canadian assets at bargain prices, he turns around and handicaps Canadians acquiring foreign assets. He must have been joking when he said advantage Canada. This is disadvantage Canada.
Now the minister prevents Canadians from deducting the interest costs of foreign acquisitions. Is this just plain lunacy? Canadian company X wishes to acquire foreign company Y and so also do a number of other foreign companies. The only company that is handicapped is the Canadian one, which effectively means the Canadian company is out of the running.
How do financial service companies acquire abroad any more? Why try to become an international company with a head office in Toronto, Montreal, Vancouver or Calgary? All the good jobs and all that go with it and all the collateral services in law, finance, accounting and technology services will no longer be needed. Either they acquire or they are acquired. Either they buy or they are bought. Either they eat or they will be eaten.
No other country in the world hobbles its business community the way the Conservative government does. Whenever the finance minister starts talking about tax fairness, it is advisable to head for the hills, especially if he is saying it during a budget speech or making an election promise.
The folks from the income trust debacle have learned to their great chagrin to never trust Conservatives during an election. After specifically and repeatedly saying they would not tax trusts, they shocked Canadians by imposing a draconian tax on trusts and destroying $25 billion to $35 billion worth of value.
People were so staggered by this betrayal that they have been putting full page ads in national newspapers saying that the Prime Minister's word is worthless. Now he is talking tax fairness again on interest deductibility. Fair share is code language. He used it with income trusts, he did it to the premiers and now he wants to destroy businesses in Canada who want to invest abroad.
Listen to what others say. Ernst & Young retired chairman Allan Lanthier said that this is “the single most misguided policy I've seen out of Ottawa in 35 years”. Claude Lamoureux said, “This is unbelievable. I don't know who in finance looked at this. I can't believe any sensible person would do this”.
Tom d'Aquino, hardly a friend of the Liberal Party, wrote:
||--we are worried that the change announced in the budget may seriously undermine the competitiveness of Canada's homegrown champions -- the companies that are most active and most successful in building global businesses from head offices in Canadian communities. It may also damage Canada's--