36th Parliament, 2nd Session
EDITED HANSARD • NUMBER 59
CONTENTS
Tuesday, February 29, 2000
 | ROUTINE PROCEEDINGS
|
1000
| MAIN ESTIMATES 2000-01
|
1005
| ORDER IN COUNCIL APPOINTMENTS
|
| Mr. Derek Lee |
| GOVERNMENT RESPONSE TO PETITIONS
|
| Mr. Derek Lee |
| EMPLOYMENT INSURANCE ACT
|
| Bill C-204
|
| Mr. Paul Szabo |
| MAIN ESTIMATES 2000-01
|
| Reference to Standing Committees
|
| Hon. Lucienne Robillard |
| Motion
|
| PRIVACY COMMISSIONER
|
| Hon. Don Boudria |
| Motion
|
1010
| PETITIONS
|
| Child Pornography
|
| Mr. Dale Johnston |
| Child Poverty
|
| Mr. Dale Johnston |
| Cruelty to Animals
|
| Hon. Christine Stewart |
| Charitable Donations
|
| Hon. Christine Stewart |
| Taxation
|
| Mr. John Reynolds |
| Constitution
|
| Mr. John Reynolds |
| Child Pornography
|
| Mr. John Reynolds |
| Immigration
|
| Mr. Gary Lunn |
| National Highways
|
| Mr. Richard M. Harris |
| Rights of the Unborn
|
| Mrs. Rose-Marie Ur |
| Constitution
|
| Mr. Paul Forseth |
| Child Pornography
|
| Mr. Paul Forseth |
| Divorce Act
|
| Mr. Paul Forseth |
1015
| Child Poverty
|
| Mr. Paul Szabo |
| QUESTIONS ON THE ORDER PAPER
|
| Mr. Derek Lee |
| Hon. Ralph E. Goodale |
| Hon. Allan Rock |
| QUESTIONS PASSED AS ORDERS FOR RETURNS
|
| Mr. Derek Lee |
| GOVERNMENT ORDERS
|
| THE BUDGET
|
| Financial Statement of the Minister of Finance
|
| Budget motion
|
| Mr. Preston Manning |
1020
1025
1030
1035
1040
1045
1050
1055
1100
1105
1110
| Amendment
|
1115
| Mr. Yvan Loubier |
1120
1125
1130
1135
| Amendment to the amendment
|
1140
| Mr. Roy Cullen |
1145
| Mr. Odina Desrochers |
1150
| Ms. Louise Hardy |
| Hon. Lorne Nystrom |
1155
1200
1205
1210
| Mr. Sarkis Assadourian |
1215
| Mr. Ken Epp |
| Mrs. Elsie Wayne |
1220
| Mr. Nelson Riis |
| Mr. Scott Brison |
1225
1230
1235
1240
1245
| Mr. Roy Cullen |
1250
| Mr. Mac Harb |
| Mr. Jean-Guy Chrétien |
1255
| Mr. Roy Cullen |
1300
1305
1310
1315
| Mr. René Laurin |
1320
| Mr. Pat Martin |
1325
| Mr. Monte Solberg |
| Mr. Monte Solberg |
1330
1335
1340
1345
| Mr. Paul Szabo |
1350
| Mr. Yvon Godin |
| Mr. Howard Hilstrom |
| Mr. Paul Bonwick |
1355
| POINTS OF ORDER
|
| Camera use in Chamber
|
| Mr. Paul Szabo |
| STATEMENTS BY MEMBERS
|
| THE BUDGET
|
| Mr. Gary Lunn |
| INTERNATIONAL WOMEN'S WEEK
|
| Ms. Carolyn Bennett |
1400
| NIAGARA REGIONAL POLICE SERVICE
|
| Mr. Walt Lastewka |
| GASOLINE PRICES
|
| Mr. Guy St-Julien |
| THE BUDGET
|
| Mrs. Marlene Jennings |
| AGRICULTURE
|
| Mr. Rick Casson |
| THE BUDGET
|
| Mr. Bernard Patry |
| MICHEL DUMOND
|
| Mr. Benoît Sauvageau |
1405
| ST. PATRICK'S DAY
|
| Mr. John Nunziata |
| THE BUDGET
|
| Mr. Ian Murray |
| APEC INQUIRY
|
| Mr. Jim Abbott |
| PUBLIC TRANSIT
|
| Mr. Mac Harb |
| THE BUDGET
|
| Ms. Wendy Lill |
1410
| THE BUDGET
|
| Mrs. Monique Guay |
| THE BUDGET
|
| Mr. Paul Szabo |
| THE LATE CLARENCE EUGENE HANK SNOW
|
| Mr. Gerald Keddy |
| FOREIGN POLICY
|
| Mr. Robert Bertrand |
| NATIONAL PARKS
|
| Mr. Rick Laliberte |
1415
| ORAL QUESTION PERIOD
|
| THE BUDGET
|
| Mr. Preston Manning |
| Hon. Paul Martin |
| Mr. Preston Manning |
| Right Hon. Jean Chrétien |
| Mr. Preston Manning |
| Right Hon. Jean Chrétien |
1420
| Mr. Monte Solberg |
| Hon. Paul Martin |
| Mr. Monte Solberg |
| Hon. Paul Martin |
| HUMAN RESOURCES DEVELOPMENT
|
| Mr. Gilles Duceppe |
1425
| Hon. Jane Stewart |
| Mr. Gilles Duceppe |
| Hon. Jane Stewart |
| Mr. Bernard Bigras |
| Hon. Jane Stewart |
| Mr. Bernard Bigras |
| Right Hon. Jean Chrétien |
1430
| HEALTH CARE
|
| Ms. Alexa McDonough |
| Right Hon. Jean Chrétien |
| Ms. Alexa McDonough |
| Right Hon. Jean Chrétien |
| HUMAN RESOURCES DEVELOPMENT
|
| Mr. Peter MacKay |
| Right Hon. Jean Chrétien |
| Mr. Peter MacKay |
1435
| Right Hon. Jean Chrétien |
| Miss Deborah Grey |
| Hon. Jane Stewart |
| Miss Deborah Grey |
| Hon. Jane Stewart |
| Mr. Paul Crête |
| Hon. Jane Stewart |
| Mr. Paul Crête |
1440
| Hon. Jane Stewart |
| Mrs. Diane Ablonczy |
| Hon. Jane Stewart |
| Mrs. Diane Ablonczy |
| Hon. Jane Stewart |
| Mrs. Christiane Gagnon |
| Hon. Jane Stewart |
1445
| Mrs. Christiane Gagnon |
| Hon. Jane Stewart |
| Mr. Chuck Strahl |
| Hon. Jane Stewart |
| Mr. Chuck Strahl |
| Hon. Jane Stewart |
| Mr. Stéphane Bergeron |
| Hon. Jane Stewart |
1450
| NATIONAL DEFENCE
|
| Mr. Hec Clouthier |
| Hon. Arthur C. Eggleton |
| HUMAN RESOURCES DEVELOPMENT
|
| Mr. Rahim Jaffer |
| Right Hon. Jean Chrétien |
| Mr. Rahim Jaffer |
| THE BUDGET
|
| Ms. Judy Wasylycia-Leis |
1455
| Hon. Paul Martin |
| Ms. Judy Wasylycia-Leis |
| Hon. Allan Rock |
| HUMAN RESOURCES DEVELOPMENT
|
| Mr. Jean Dubé |
| Right Hon. Jean Chrétien |
| Mr. Jean Dubé |
| Hon. Jane Stewart |
1500
| THE ENVIRONMENT
|
| Mrs. Karen Redman |
| Ms. Paddy Torsney |
| HUMAN RESOURCES DEVELOPMENT
|
| Ms. Val Meredith |
| Hon. Jane Stewart |
| Mrs. Suzanne Tremblay |
| Hon. Jane Stewart |
| TUITION FEES
|
| Ms. Libby Davies |
| Hon. Paul Martin |
1505
| ACOA
|
| Mrs. Elsie Wayne |
| Hon. George S. Baker |
1510
| POINTS OF ORDER
|
| Official Document
|
| Mr. John Cummins |
1515
| Mr. John Duncan |
| GOVERNMENT ORDERS
|
| THE BUDGET
|
| Financial Statement of Minister of Finance
|
| Budget motion
|
| Ms. Sarmite Bulte |
1520
1525
| Mr. Ken Epp |
1530
| Ms. Judy Wasylycia-Leis |
1535
| Mr. Tony Valeri |
1540
1545
| Mrs. Christiane Gagnon |
| Mr. Deepak Obhrai |
1550
| Mr. Richard Marceau |
1555
1600
1605
1610
| Mr. Ken Epp |
1615
| Mr. Alex Shepherd |
1620
| Mr. Ted McWhinney |
1625
1630
| Mrs. Christiane Gagnon |
1635
| Mr. Pat Martin |
| Ms. Aileen Carroll |
1640
1645
| Mr. Ken Epp |
1650
| Mr. Ghislain Fournier |
| Mr. John Solomon |
1655
1700
| Mr. Roy Cullen |
1705
| Ms. Judy Wasylycia-Leis |
1710
1715
| Mr. Paul Szabo |
1720
1725
| Mr. Jerry Pickard |
1730
| Mr. Rick Borotsik |
1735
| Mr. Alex Shepherd |
1740
1745
| Mr. Ken Epp |
1750
| Mrs. Elsie Wayne |
1755
| Ms. Diane St-Jacques |
1800
| Mr. Rick Borotsik |
1805
1810
| Mr. Roy Cullen |
1815
| Mrs. Rose-Marie Ur |
1820
1825
| Mr. Gerald Keddy |
| Mr. Roy Cullen |
1830
| ADJOURNMENT PROCEEDINGS
|
| Gasoline Prices
|
| Mr. John Solomon |
1835
| Mr. John Cannis |
| East Timor
|
| Mrs. Francine Lalonde |
1840
| Mr. Robert Bertrand |
| Airline Industry
|
| Mr. Bill Casey |
1845
| Mr. Stan Dromisky |
| Foreign Affairs
|
| Mr. Paul Szabo |
| Mr. Denis Paradis |
1850
(Official Version)
EDITED HANSARD • NUMBER 59
HOUSE OF COMMONS
Tuesday, February 29, 2000
The House met at 10 a.m.
Prayers
ROUTINE PROCEEDINGS
1000
[Translation]
MAIN ESTIMATES 2000-01
The President of the Treasury Board presented a message read by
the Deputy Speaker in which His Excellency the Governor General
transmitted the Main Estimates for the fiscal year ending on
March 31, 2001.
* * *
1005
[English]
ORDER IN COUNCIL APPOINTMENTS
Mr. Derek Lee (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, I am
pleased to table, in both official languages, a number of order
in council appointments made recently by the government.
Pursuant to the provisions of Standing Order 110, these
appointments are deemed referred to the appropriate standing
committee, a list of which is attached.
* * *
GOVERNMENT RESPONSE TO PETITIONS
Mr. Derek Lee (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, I am
pleased to table, in both official languages, the government's
response to six petitions.
* * *
EMPLOYMENT INSURANCE ACT
Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker, I
rise on a point of order. I would seek the unanimous consent of
the House to withdraw my private member's Bill C-204, which was
first introduced in the House in October 1998 and was
reintroduced in October 1999.
This bill sought to extend maternity and parental leave benefits
to a full year. In view of the budget provisions announced last
evening, I now ask the House for its consent to withdraw Bill
C-204.
The Deputy Speaker: Is that agreed?
Some hon. members: Agreed.
(Order discharged and bill withdrawn)
* * *
[Translation]
MAIN ESTIMATES 2000-01
REFERENCE TO STANDING COMMITTEES
Hon. Lucienne Robillard (President of the Treasury Board and
Minister responsible for Infrastructure, Lib.): Mr. Speaker,
pursuant to Standing Orders 81(4) and 81(6), I move:
That the main estimates for the fiscal year ending March 31,
2000, laid upon the table on February 29, 2000, be referred to
the several standing committees of the House in accordance with
the detailed allocation attached.
There is a lengthy list associated with the motion. If it is
agreeable to the House, I would ask that the list be printed in
Hansard as if it had been read.
The Deputy Speaker: Is that agreed?
Some hon. members: Agreed.
[Editor's Note: List referred to above is as follows:]
Indian Affairs and Northern Development, Votes 1, 5, 10, 15, L20,
25, 30, 35 and 40
Agriculture and Agri-Food, Votes 1, 5, 10, 15, 20, 25, 30 and 35
Canadian Heritage, Votes 1, 5, L10, 15, 20, 25, 30, 35, 40, 45,
50, 55, 60, 65, 70, 75, 80, 85, 90, 95, 100, 105, 110, 115, 125
and 130
Privy Council, Votes 30 and 35
Canada Customs and Revenue Agency, Votes 1, 5 and 10
Finance, Votes 1, 5, L10, 15, 30 and 35
Foreign Affairs, Votes 1, 5, 10, 15, 20, 25, L30, L35, 40, 45, 50
and 55
Health, Votes 1, 5, 10, 15, 20 and 25
To the Standing Committee on Human Resources Development and
the Status of Persons with Disabilities
Human Resources Development, Votes 1, 5, 10, 15 and 20
Industry, Votes 1, 5, L10, L15, 20, 25, 30, 35, 40, 45, 50, 55,
60, 65, 70, 75, 80, 85, 90, 95, 100, 105, 110, 115 and 120
Justice, Votes 1, 5, 10, 15, 20, 25, 30, 35, 40, 45 and 50
Privy Council, Vote 50
Solicitor General, Votes 1, 5, 10, 15, 20, 25, 30, 35, 40, 45 and
50
National Defence, Votes 1, 5 and 10
Veterans Affairs, Votes 1, 5 and 10
Canadian Heritage, Vote 120
Governor General, Vote 1
Natural Resources, Votes 1, 5, L10, 15, 20, 25 and 30
Parliament, Vote 1
Privy Council, Votes 1, 5, 10, 45 and 55
Public Works and Government Services, Votes 1, 5, 10, 15, 20 and
25
Treasury Board, Votes 1, 2, 5, 10, 15 and 20
Parliament, Vote 5
Privy Council, Vote 20
Privy Council, Vote 15
Transport, Votes 1, 5, 10, 15, 20, 25, 30 and 35
(Motion agreed to)
* * *
[English]
PRIVACY COMMISSIONER
Hon. Don Boudria (Leader of the Government in the House of
Commons, Lib.): Mr. Speaker, there have been consultations
among all parties earlier this day and I would like to move the
following motion without debate:
That, in accordance with subsection 53(3) of the act to extend
the present laws of Canada that protect the privacy of
individuals and that provide individuals with a right of access
to personal information about themselves, Chapter P-21 of the
Revised Statutes of Canada, 1985, this House approves the
reappointment of Bruce Phillips as Privacy Commissioner for a
term of four months, effective May 1, 2000.
This is a four month extension only.
The Deputy Speaker: Does the hon. the Leader of the
Government in the House of Commons have the unanimous consent of
the House to propose this motion?
Some hon. members: Agreed.
The Deputy Speaker: The House has heard the terms of the
motion. Is it the pleasure of the House to adopt the motion?
Some hon. members: Agreed.
(Motion agreed to)
* * *
1010
PETITIONS
CHILD PORNOGRAPHY
Mr. Dale Johnston (Wetaskiwin, Ref.): Mr. Speaker, my
constituents, along with other Canadians, are horrified by
pornography which degrades children and are astounded by legal
determinations that possession of such pornography is not
criminal.
Therefore, the petitioners call upon parliament to take all
necessary measures to ensure that possession of child pornography
remains a serious criminal offence and that federal police forces
be directed to give priority to enforcing this law for the
protection of children.
CHILD POVERTY
Mr. Dale Johnston (Wetaskiwin, Ref.): Mr. Speaker, in the
second petition my constituents urge parliament to fulfil the
promise made in 1989 by the House of Commons to end child poverty
by the year 2000.
CRUELTY TO ANIMALS
Hon. Christine Stewart (Northumberland, Lib.): Mr.
Speaker, I have the pleasure to present two petitions to the
House today. The first petition is from constituents from
various communities in Ontario who express their concern about
cruelty to animals and request that the federal government bring
in new legislation to deal with it.
I am sure they will be pleased with the legislation we have
tabled in the House.
CHARITABLE DONATIONS
Hon. Christine Stewart (Northumberland, Lib.): Mr.
Speaker, the second petition is from constituents who believe
that registered charities and not for profit groups deserve the
same tax credit advantage for donations of $1,150 and under as
federal political parties.
TAXATION
Mr. John Reynolds (West Vancouver—Sunshine Coast, Ref.):
Mr. Speaker, I have three petitions to present this morning. The
first one is from constituents in western Canada who ask the
government for 25% tax relief. I wish them good luck.
CONSTITUTION
Mr. John Reynolds (West Vancouver—Sunshine Coast, Ref.):
Mr. Speaker, the second petition is from constituents who ask
that parliament ensure that the supremacy of God remains in the
Canadian constitution.
CHILD PORNOGRAPHY
Mr. John Reynolds (West Vancouver—Sunshine Coast, Ref.):
Mr. Speaker, the third petition bears over 40,000 signatures of
people who believe that the government should be doing more about
child pornography, especially using the notwithstanding clause to
protect young children in Canada.
IMMIGRATION
Mr. Gary Lunn (Saanich—Gulf Islands, Ref.): Mr. Speaker,
on November 3, 1999 I presented a petition which I had received
bearing over 10,000 signatures from people residing in British
Columbia who called on the Government of Canada to enact
legislation which would change the immigration laws so that when
refugees arrive on our shores, come through our airports or
arrive in Canada through any means who are found not to be bona
fide refugees, they be sent home immediately, without delay.
I am pleased to add another 203 signatures to the original
10,000, making a total of over 11,000 as of today.
NATIONAL HIGHWAYS
Mr. Richard M. Harris (Prince George—Bulkley Valley,
Ref.): Mr. Speaker, the people in my riding of Prince
George—Bulkley Valley are very concerned about the lack of
attention the government has been paying to the national highway
system, in particular Highway 16, the Yellowhead highway system.
The petitioners urge the government to designate a portion of
the fuel taxes that it collects on an ongoing basis to improve
and maintain highways.
The petitioners call on parliament to prioritize highway
maintenance funding from the revenue which the government
receives from fuel taxes.
There are several hundred signatures which I am pleased to
present on behalf of concerned citizens of Prince George—Bulkley
Valley.
RIGHTS OF THE UNBORN
Mrs. Rose-Marie Ur (Lambton—Kent—Middlesex, Lib.): Mr.
Speaker, pursuant to Standing Order 36, I wish to present a
petition signed by residents of the towns of Wallaceburg and
Dresden who urge the government to protect human life at the
pre-born stage by amending the criminal code to extend the same
protection enjoyed by human beings to unborn human beings.
CONSTITUTION
Mr. Paul Forseth (New Westminster—Coquitlam—Burnaby,
Ref.): Mr. Speaker, I am pleased to present three petitions
today. The first one is from over 4,200 petitioners, many from
my riding, who oppose any amendments to the Canadian Charter of
Rights and Freedoms or any other federal legislation which would
provide for the exclusion of the reference to the supremacy of
God.
CHILD PORNOGRAPHY
Mr. Paul Forseth (New Westminster—Coquitlam—Burnaby,
Ref.): Mr. Speaker, the second petition requests parliament
to immediately invoke the notwithstanding clause to override the
B.C. court decision concerning child pornography and to make the
possession of pornography illegal in British Columbia.
DIVORCE ACT
Mr. Paul Forseth (New Westminster—Coquitlam—Burnaby,
Ref.): Mr. Speaker, in the third petition the petitioners ask
that the government amend the Divorce Act immediately, taking
into consideration the recommendations made by the Special Joint
Committee on Child Custody and Access on December 8, 1998,
including the minority report submitted by the Reform Party of
Canada.
1015
CHILD POVERTY
Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker,
pursuant to Standing Order 36, I am pleased to present a petition
signed by a number of Canadians, including petitioners from my
own riding of Mississauga South. It concerns the issue of child
poverty.
The petitioners want to draw to the attention of the House that
one in five Canadian children live in poverty, and that in
November 1989 the House of Commons passed a resolution to seek to
achieve the elimination of child poverty by the year 2000, and
also that the number of poor in Canada has increased by 60% since
1989.
The petitioners therefore call on parliament to use the federal
budget 2000 to introduce a multi-year plan to improve the
well-being of Canada's children. I believe the finance minister
did that.
* * *
QUESTIONS ON THE ORDER PAPER
Mr. Derek Lee (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, the
following questions will be answered today: Nos. 2 and 36.
.[Text]
Question No. 2—Mr. Rick Borotsik:
What was the total cost of the Canadian Wheat Board's 61 public
forum meetings held on Justice Willard Estey's grain handling and
transportation review recommendations, including per diem for
board members, travel, staff costs, hall rentals and advertising?
Hon. Ralph E. Goodale (Minister of Natural Resources and
Minister responsible for the Canadian Wheat Board, Lib.):
Pursuant to a decision by its directors, two-thirds of whom are
directly elected by prairie producers, the Canadian Wheat Board
held a total of 61 meetings across the prairies in order to
consult with farmers on grain transportation issues. The total
cost of holding and attending these meetings was $53,000.00.
Question No. 36—Ms. Judy Wasylycia-Leis:
With regard to the special allocation for hepatitis C announced
by the Minister of Health on September 18, 1998: (a) how much
of the $50 million for new hepatitis C disease prevention,
community-based support programs, and research has been spent to
date and what is the breakdown of those expenditures (including
an indication of the amounts spent within Health Canada); and (b)
how much of the $300 million special transfer to provinces to
supplement health services has been spent to date and what is the
breakdown of those expenditures?
Hon. Allan Rock (Minister of Health, Lib): (a) On
September 18, 1998 Health Canada announced a strategy to address
the concerns of Canadians regarding hepatitis C. As part of this
strategy, a commitment of $50 million over 5 years was made for
the development and implementation of a new hepatitis C program.
Health Canada officials consulted with stakeholder groups, the
provinces and the territories, medical and research organizations
and individuals across the country living with or affected by
hepatitis C (persons living with or caring for someone who has
hepatitis C) and the organizations that represent them to
identify needs and to seek guidance on designing the various
components of the new hepatitis C program.
Following these consultations, a new unit in Health Canada, the
hepatitis C division, has been created to ensure federal capacity
to respond to the challenges and needs posed by hepatitis C. This
division has a mandate: to act as focal point for a population
health approach to hepatitis C: to build knowledge and provide evidence
by fostering research initiatives; to increase awareness and
capacity; to develop prevention strategies and support
initiatives, and to ensure that Canadians who have been infected
through blood do not incur out-of-pocket expenses for medical
treatment.
The Program is now in operation. Program expenditures to date
total $650,543. The breakdown of these expenditures and projected
expenditures for 1999/2000 are as follows:
First year funding was profiled at approximately $6 million in
recognition of the need to develop and staff the program and to
develop funding frameworks and accountability measures. Internal
expenditures to date are principally for salaries.
A public document describing the hepatitis C disease prevention,
community-based support and research program will be released in
the near future.
A program advisory group (PAG) of representatives from key
stakeholder groups has been created.
On July 7, 1999 Health Canada and the Medical Research Council
announced a joint $18 million research initiative. A joint
advisory committee on research made up of clinicians,
researchers, the private sector, Canadian Blood Services/Héma
Québec and representatives from key stakeholders' groups has been
formed. Twenty-eight research proposals have been received and
are under consideration.
A survey questionnaire to obtain baseline data has been
developed and is being administered by the regional offices.
Funding guidelines for three national level stakeholders (i.e.
the Hepatitis C Society of Canada, the Canadian Hemophilia
Society and the Canadian Liver Foundation) were released in July
and applications from these organizations for operational funds
are currently being assessed. Some of the activities proposed by
these stakeholders include the enhancement of 1-800 lines,
volunteer needs assessment, newsletters to provide information on
hepatitis C, and the development of information and organization
development sessions at the national, regional and local levels.
The funding guidelines for prevention and community-based
support for the regional and local levels are now available.
Staff in the regional offices of the Health Promotion and
Programs Branch of Health Canada are administering this funding.
In partnership with stakeholders, staff will also establish
regional priorities for funding.
Projects initiated and/or supported under the care and awareness
component currently include:
Dissemination of treatment guidelines for hepatitis C which were
recently developed by the Canadian Association for the Study of
the Liver (CASL). These guidelines provide treating physicians
with the best available evidence and will help to ensure
consistency of treatment for all Canadians. It is available on
the CASL website (http://www.ihsc.on.ca/casl/) and will be
distributed to all physicians in the future. Their address is:
Canadian Association for the Study of the Liver; c/o President, Dr. Sam Lee,
Division of Gasteroenterology; University of Calgary; Health
Science Centre; Room 1721, 3330 Hospital Drive; Calgary, Alberta,
T2N 4N1, telephone (403) 220-3245, fax (403) 270-0995;
The development of a physician document-patient handout by the
Canadian Liver Foundation. The handout will be provided to all
general practitioner and family doctors in Canada to support the
treatment of infected persons and provide “first contact”
information for those persons diagnosed with hepatitis C;
A Canadian Association for the Study of the Liver (CASL)
steering group meeting for a Hepatitis C Network for Research and
Treatment was held on October 28, 1999, supported with funding
from Health Canada;
A request for proposals for treatment guidelines for pregnant
women is ready to be tendered; and
Funding guidelines for national projects under the care and
awareness component have been finalized and are currently
available.
(b) The federal government is working hard with the provincial
and territorial governments to implement this $300 million
special transfer. While no funds have been transfered to date, we
are anticipating that the money will start to flow shortly.
* * *
[English]
QUESTIONS PASSED AS ORDERS FOR RETURNS
Mr. Derek Lee (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, if
Question No. 61 could be made an order for return, the return
would be tabled immediately.
The Deputy Speaker: Is that agreed?
Some hon. Members: Agreed.
.[Text]
Question No. 61—Mr. Jim Pankiw:
For each of the past five (5) fiscal years and with respect to
federal funds used in the promotion of French and English across
Canada, what has the government through the Department of
Heritage determined to be: (a) the total amount spent on
promoting French in communities outside Quebec; (b) the total
amount spent on promoting English within Quebec; (c) the names
of all organizations, in respect of the foregoing, and the amount
of funding received by each; (d) the total number of
Francophones, by mother tongue, who reside outside Quebec; and
(e) the total number of Anglophones, by mother tongue, who
reside within Quebec?
Return tabled.
[English]
Mr. Derek Lee: I ask, Mr. Speaker, that the remaining
questions be allowed to stand.
The Deputy Speaker: Is that agreed?
Some hon. members: Agreed.
The Deputy Speaker: There is a motion under Standing
Order 52 from the hon. member for Calgary Centre.
Mr. Eric Lowther: Mr. Speaker, we will withdraw for the
moment.
GOVERNMENT ORDERS
[English]
THE BUDGET
FINANCIAL STATEMENT OF THE MINISTER OF FINANCE
The House resumed from February 28 consideration of the motion
that this House approves in general the budgetary policy of the
government.
Mr. Preston Manning (Leader of the Opposition, Ref.): Mr.
Speaker, I rise to begin debate on the first federal budget of
the new century.
I would like to dedicate this reply to the budget address to a
new Canadian, Joshua Jacob Kroon, born early yesterday evening to
our oldest daughter Andrea and her husband Howard. The baby was
born on budget day. When I meet young Joshua I am afraid it will
be my duty to inform him that according to the budget tabled
yesterday he already owes $18,600, that being his portion of the
national debt. That is bad news for young Joshua. However, the
good news is that by the time he becomes of age, Canada will no
doubt have a new government and the Liberal legacy of high
spending, high taxes and high debt will be a distant memory.
In addressing budget 2000, I am conscious, and I am sure all
members are conscious, that millions of Canadians have hopes and
dreams for themselves and their children that can be affected by
the spending policies, the taxation policies and the budgetary
promises of the federal government. For example, if the federal
government wastes taxpayer dollars through irresponsible spending
it is Canadians who suffer because there are then insufficient
dollars available to fund those services, such as health care,
which Canadians value highly.
If the federal government taxes Canadians too heavily it is the
take home pay and the bank accounts of individuals, families and
employers that are savaged and it is Canadian jobs and economic
opportunities that are killed and exported.
If the finance minister makes promises and commitments in his
budgets which are then broken, if the truths asserted in the
budget turn out to be half truths, which are more dangerous than
falsehoods because they are more difficult to detect, then it is
the faith of Canadians in the integrity of the government itself
which is shaken and eroded.
With this preamble, allow me to review the federal budget under
three simple headings: spending, taxes and integrity.
It is clear again from this budget that the highest priority of
the Liberal government is not tax relief but the increased
spending of taxpayer dollars. The budget reveals that the
government will be spending $4.3 billion more this year than
provided for in last year's estimates. In other words, the
promises in last year's budget to limit spending to $111.2
billion will once again be broken as the government spends $115.5
billion.
This chronic tendency of Liberal governments to break promises
to limit spending has been criticized by the auditor general in
these words:
At issue is more than the mere fact that the government spent
more than it planned to spend. How this was done also matters.
A scramble around budget time to find ways to spend money before
the year ends is not a process calculated to ensure efficiency,
effectiveness and economy in the use of public funds. In fact,
it differs little from the end of the year spending by the
departments with surplus funds, except that it involves not
millions but billions of taxpayers' dollars.
1020
In other words, the end of the year spending binges that have
often characterized the government's departments has now spread
to the Treasury Board, the finance department and the government
as a whole, and this of course is a backward step.
Turning to the future, the finance minister projects surpluses
for the next five years of more than $150 billion. If the
government truly believed that these surpluses belong to the
people, it would give the bulk of them back to the people. What
is the finance minister's highest priority with respect to the
use of those future surpluses? Is it tax relief? No. Is it
debt reduction? No. Once again, the highest priority is to
spend.
Of the $152 billion in projected surpluses over the next five
years, the government implies that it will spend $66 billion,
provide $58 billion in tax relief, apply $15 billion to the debt
and leave $13 billion unallocated. Even if one took these
figures at face value, which we do not, spending is still the
highest priority.
The taxpayers and the official opposition also know that the
government spends unallocated revenue, so that the $13 billion in
unallocated revenue should be put into spending. The child care
tax benefit is a social program not a tax relief program, so that
should be put into spending.
Taxpayers and the official opposition also know that the
cancellation of bracket creep, with which we concur, is a
cancellation of future tax increases not a cut for today's
taxpayer and it should not really be included in the tax relief
figure. Even if we just take into account these first two
adjustments, what the government will do with the projected $152
billion in surpluses is apply $15 billion to debt reduction,
provide less than $51 billion in tax relief and spend $86.3
billion. Surprise, surprise. Once again the highest priority of
the government is spending taxpayers' dollars.
I note with interest that the government says on page 12 of the
budget that it will be supporting more genetic research. When the
human genome project is completed, perhaps a complete genetic map
of the Liberal species will become available. I am sure that our
scientists will discover that the Liberals possess a recessive
financial gene. That gene renders them congenitally incapable of
saving taxpayers' dollars and compulsively inclined to spend
them.
Whether a permanent cure for this disorder will be developed,
only time will tell. At present, however, there is only one
known remedy and that is to remove the temptation and the
capacity for Liberals to spend taxpayer dollars by removing them
from office.
The most shocking and disappointing aspect of the federal
government's spending program is not the government's
overspending of last year's budget. It is not that increased
spending of taxpayer dollars continues to be the government's
highest priority. We expected all that. The most shocking and
disappointing aspect of the treatment of federal spending in this
budget is what can only be described as an incredible omission.
I refer to the finance minister's failure to even mention in his
budget, let alone address, the spending scandal at human
resources development, a scandal which shakes to the core any
faith the public might still have in the government's capacity to
spend taxpayer money responsibly.
All the government's spending promises and spending plans remain
compromised as long as the spending scandal at HRD remains
unaddressed and unresolved.
As everyone in parliament knows, the spending of HRD on programs
like the Canada jobs fund has been suspect for years. The odour
finally became so bad that this summer the department itself was
compelled to do an internal audit of 459 files, representative of
$1 billion in spending on grants and contributions.
What did that internal audit reveal? It revealed that 15% of
the files reviewed did not have an application on file from the
sponsor; 72% had no cashflow forecast; 11% had no budget
proposal; 11% had no description of expected results; 97% of the
files showed no evidence that anyone had even checked to see if
the recipient already owed money to HRD or the government; 80% of
the files showed no evidence of financial monitoring; and 87% of
the files showed no evidence of supervision.
1025
We understand that this audit has inspired the CBC to propose a
new game show called “Who Wants to be a Grant Recipient”, with
the Minister of Human Resources Development as the host. It
would be just like Who Wants to be a Millionaire, except
the host does not ask any questions.
Of particular concern to parliament, the ultimate watchdog over
the public purse, is that the gross mismanagement of taxpayer
dollars at human resources is just the tip of the iceberg.
The federal government spends more than $13 billion per year
under the heading of grants and contributions; the spending
category under which the HRD funds have been so grossly
mismanaged.
If a random audit found that 8% of the files the auditors looked
at were so bad that they required a forensic investigation and
perhaps referral to the police, what is the situation in the
thousands and thousands of unexamined files in that department
and across the government?
The Auditor General of Canada has repeatedly warned the
government concerning the presence and the size of this iceberg.
This is not something new.
In chapter 27 of his 1998 report he said:
We have reported to parliament on numerous audits of grants and
contribution programs over the past 21 years. Many of those
audits identified similar concerns: inconsistent application or
interpretation of government policy on grants and contributions;
inefficient use of funds and inadequate measures to ensure
accountability by program recipients; lack of control, monitoring
and evaluation; and reporting in the estimates and the public
accounts that was inadequate to facilitate examination and
year-to-year comparisons by parliament.
These conditions all still exist at human resources, hence the
spending boondoggle there.
The auditor general went on to say in his 1998 report that these
same conditions also exist with respect to the management of
grants and contributions by the Department of Indian Affairs and
Northern Development, by the Department of Citizenship and
Immigration, by the Department of Fisheries and Oceans and by the
Department of Industry with particular reference to federal
regional development agencies, such as the Atlantic Canada
Opportunities Agency, the Federal Office of Regional Development
for Quebec and the Western Economic Diversification Agency.
At a meeting recently in the Peace River country, I described
the whole HRD scandal. A farmer came up to me afterward and
asked if there was any way that we could persuade the Prime
Minister to make the human resources development minister the
minister of taxes. When I asked him why he would want such a
change, he said that if she mismanages the collection of tax
money like she mismanages the distribution of it, that might be
as good as a tax break. He said that she might lose his file or
forget to check whether he owed the government any money.
It is not just the Minister of Human Resources Development who
is implicated in the gross mismanagement of taxpayer dollars
under the heading of grants and contributions. The government
says in the budget that it wants to foster a culture of
innovation. However, it is a culture of fiscal irresponsibility
that permeates this government. The blame lies with all the
ministers who have tolerated it or cultivated it for so long,
including the Minister of Finance and, worst of all, the Prime
Minister himself.
That the Prime Minister is part of the problem, if not at the
heart of the problem, can be demonstrated in half a dozen ways.
Let us look, for example, at the mismanagement of grants and
contributions to the Prime Minister's own riding, particularly
through the transitional jobs fund or later the Canada jobs fund.
What are we to conclude from the following: The Prime
Minister's statement to the electors of Saint-Maurice in 1993, as
reported in the Montreal Gazette of October 15, “When a
dossier for Saint-Maurice lands on a cabinet minister's
desk—need I say more—”, he said to gales of laughter during
a campaign meeting yesterday”. The taxpayers are not laughing.
Over $2 million in federal government grants and loans given to
the Shawinigan hotel project owned by a self-confessed embezzler,
$600,000 of it granted and announced without any departmental
paperwork two months before the 1997 federal election.
The $164,000 transitional jobs fund grant given to Yvon Duhaime
whose hotel was adjacent to the Grand-Mère golf course in which
the Prime Minister held a 25% interest. This grant was announced
four days before the election and almost two months before any
ministerial approval.
1030
There was the $2.04 million transitional jobs fund grant given
to companies owned by René Giguère which contributed $4,000 to
the Prime Minister's personal campaign in 1997 and almost $15,000
to the Liberal Party of Canada in 1997 and 1998.
There was the $2.5 million grant from HRD given to build a
training centre for new economy jobs in the Prime Minister's
riding. This is currently being investigated by the RCMP because
of allegations that more than $100,000 of that money found its
way into the pockets of local directors.
There was the $200,000 grant announced by the federal regional
development agency for Quebec for building a lighted fountain in
the Saint-Maurice River in the Prime Minister's riding. Access
to information documents reveal that this project was being
lobbied for by the Prime Minister's office even before a formal
application had been made by the sponsor.
Just last week HRD was forced to order a forensic audit into how
funds earmarked for a project in the Montreal riding of Rosemont
ended up bankrolling a virtually identical project in Shawinigan,
once again in the Prime Minister's riding.
If I were describing to the House events occurring in some
underdeveloped country with a corrupt and dictatorial government
with no traditions or mechanisms for enforcing political or
fiscal accountability, hon. members might shake their heads and
say that it was regrettable but perhaps understandable. But the
events I have been describing have been happening in Canada and
involve the Prime Minister of Canada. What a shame. What a
disgrace. What a scandal.
We are talking about the misuse and mismanagement of taxpayers'
dollars, taxpayers' dollars which the House holds the Minister of
Finance accountable for budgeting and managing responsibly. We
have the right, indeed we have the responsibility to ask where
has the Minister of Finance been in all of this and why is there
not a single reference in the budget to these matters?
The finance minister, the would be prime minister, is implicated
in all of this. It is now clear from the public accounts
particularly between 1995 and 1998 that at the very time the
finance minister was slashing health care funding, he was
actually increasing the flow of funds to HRD and these programs
where taxpayers' dollars were being wasted by the millions.
While the finance minister was withholding funds for hospital
beds across Canada, he was authorizing funds for hotel beds in
the Prime Minister's riding. Not only were the government's
spending controls dysfunctional, but its spending priorities were
upside down and the finance minister did nothing to correct
either.
Despite all of the evidence of gross mismanagement of federal
spending on grants and contributions—and I have only touched on
the tip of the iceberg as the auditor general reports make
clear—I draw to the attention of the House that in the
minister's hour long budget speech yesterday, in the 350 pages of
the year 2000 budget plan tabled in the House yesterday, there is
not a single reference or even an acknowledgement of this
problem. Nor is there any comprehensive proposal for remedying
it and restoring the public's faith in the integrity of the
government's management of taxpayers' dollars.
This is an incredible omission. This is an inexcusable
omission. This omission is an insult to the finance committee of
the House. It is an insult to the public accounts committee. It
is an insult to the auditor general. It is an insult to the
intelligence of the whole House. Most certainly and most
deplorably of all, it is an insult to the long suffering Canadian
taxpayer.
I venture to say that if any large public company in this
country had a billion dollar spending boondoggle in one of its
divisions and failed to report it or address it in its annual
report to the shareholders, not only would its shares be hammered
on the stock market but its vice-president of finance would be
dismissed and would face disciplinary action from both the
shareholders and the securities commission.
The House passed a law called the Canada Corporations Act that
requires companies to adhere to a standard of financial reporting
higher than that practised by this government. How can we demand
a higher standard from the private sector than we actually demand
in the handling of public money?
1035
To add insult to injury, the finance minister has the nerve to
come to the House asking for authority to increase federal
spending by over $80 billion over the next five years. To that we
respond in the name of and on behalf of the taxpayers by asking,
why should the House give the government one dollar more of
taxpayers' money to spend when it is grossly mismanaging the
billions of dollars that it has already been given? Why should
the House authorize the government to spend more taxpayers'
dollars when the government's budget does not even acknowledge
the gross mismanagement or propose any concrete spending controls
to prevent it from ever happening again?
Some taxpayers may actually read the budget. They may come to
the heading on page 8, “Sound Financial Management”. Then the
taxpayers will come to the sentence on page 9, “Let there be no
doubt, we will control spending”. When the taxpayers see that,
they will say, “Really. You will control spending like you
controlled it at HRD, like you control it at Indian affairs, like
you control it in the heritage department. No thanks”.
The spending proposals of the minister and the government
contained in the budget are unacceptable to Canadians and to the
House. They are unacceptable not simply because they propose to
increase spending and the burden on taxpayers yet again, but
because the integrity of the government spending is compromised
and the budget does not even recognize the fact let alone address
it.
Mr. Lynn Myers: The taxpayers were paying while you were
away campaigning.
Mr. Preston Manning: An hon. backbencher across the way
mentioned the word taxes. Let us enlighten him on the subject of
taxes. It is a great, difficult task to enlighten the hon.
member.
I will turn to the other side of the loonie, to the taxation
aspects of the budget, because for every dollar the finance
minister and the Liberals propose to spend, there is a tax which
must first be imposed upon and collected from Canadians.
First, the tax proposals contained in the budget must be
considered in the context of the government's overall taxation
record. That record is one of constantly increasing taxes and
tax revenue. The official opposition finance critic, the member
for Medicine Hat, has prepared some instructive charts on the
government's taxation record which I commend to all members.
The one on personal income taxes shows Canada with the dubious
distinction of leading the industrialized world in terms of high
personal income taxes. The personal income taxes extracted from
Canadians by their governments amount to 13.9% of GDP compared to
the next highest nation which happens to be the United States at
10.7%. This is the biggest single reason why Canadians' standard
of living measured in terms of real personal after tax income was
$833 lower per person in 1999 than in 1989, while the real
personal after tax income in the U.S. increased by $2,200 U.S.
over the same period.
When it comes to payroll taxes, these charts show that
job-killing payroll taxes for Canadians continue to climb, with
skyrocketing increases in CPP premiums more than offsetting the
token decreases in employment insurance premiums. When it comes
to consumption taxes, by 2005 the federal government will be
collecting almost $30 billion per year from GST, almost double
what it was collecting in 1993 when the present Prime Minister
promised to abolish it. It is the combination of all these high
taxes which is driving capital, employees, employers and jobs out
of the country and which has earned the finance minister the
dubious title of Captain Brain Drain.
I wish to establish the fact that contrary to the assertions of
the Minister of Finance, after this budget Canadian taxpayers
will be worse off not better off than they were when the
government took office. They will continue to be worse off into
the future unless the government is removed from office and
replaced with one dedicated to genuine tax relief.
1040
The simplest way to demonstrate this is to look at the
minister's spending and taxation projections for the next five
years. The minister proposes to reduce federal taxes by $51
billion—and we think it is much less than that—over the next
five years, $11.2 billion over the next two. But over the same
period he proposes to increase the spending of tax dollars by
$86.3 billion. Figure it out.
This budget continues the old Liberal shell game that has been
going on for years and which has characterized every budget
presented by the minister in which tax relief has been mentioned.
With the right hand and with great flourish to attract our
attention, he gives $51 billion in tax relief over five years.
But with the left hand and surreptitiously through previously
authorized tax increases, he extracts $86.3 billion from our
other pocket. In the end the taxpayer is paying more, not less,
than the Liberals were taking in 1993.
The charts prepared by the finance critic for the official
opposition show that when the minister's hidden tax increases are
added to his announced tax breaks over the last six years,
Canadian families will still pay $703 per family more in taxes
next year than they did in 1993 when the Liberals took office.
When the finance minister's hidden taxes are added to his
announced tax breaks over the next five years, Canadian families
will still be paying more per family than they did when the
Liberals took office in 1993.
That is why we describe the tax measures in this budget as
half-baked tax breaks. We call upon Canadians who want real tax
relief to examine and support our solution 17 tax relief proposal
which my colleague, the member for Medicine Hat, will describe in
more detail later on.
It is not just the weakness and inadequacy of the finance
minister's so-called tax relief proposals that would disturb
Canadians. Once again it is the absence of integrity on the tax
side of the budget that casts a shadow over every tax proposal
and promise the minister makes. Unlike the concept of deficit
reduction or balancing a budget, which is an academic concept to
most people where the taxpayer has to take it on faith that the
goal has been achieved, when it comes to tax relief, the taxpayer
on his or her own is able to determine whether or not the
promised tax relief has actually been delivered.
The taxpayer can look at his or her paystub at the end of the
pay period. He or she can compare the deductions of this pay
period with those of last year or last month and determine for
themselves whether the take home pay has increased or decreased.
The family can look at its chequebook and bank account. It can
tell whether or not it is receiving real tax relief by whether
its after tax income is increasing or shrinking. When real
Canadian families do that, they find that real after tax income
in Canada over the last decade decreased by almost $3,000 per
family.
It does not matter whether the words tax relief appeared in
every second sentence in the federal government's throne speech.
It does not matter whether the words occur in every sentence in
the speeches by the Prime Minister or in the budget speeches by
the finance minister or in media headlines and reports on the
budget. If promised tax relief does not show up on the paystubs
and in the bank accounts of ordinary Canadians, then it is not
real tax relief no matter how much PR accompanies it.
If the government keeps promising tax relief year after year but
it does not show up on the paystub or in the bank account of the
taxpayer, after a while the taxpayer catches on to the shell
game. Yes there can be a highly visible tax cut like the changes
in rates, deductions and credits announced in the budget,
including the elimination of bracket creep, which we commend. But
there are also much less visible tax increases, like the
pre-scheduled increases in CPP premiums which take effect without
further announcements or fanfare. The list goes on and on.
Invariably under a Liberal government the increases are greater
than the decreases so that the total tax load gets heavier and
heavier. This has been precisely the Canadian experience and why
Canadians find themselves paying more in taxes despite all the
announced decreases than when this government took office.
The promise of tax relief is often a half-truth. The other half
of the truth is that there is also a tax increase.
1045
When government budgets like this government's budget are
riddled with those kinds of half-truths, and when promises of tax
relief are made year after year but no real tax relief shows up
in the taxpayer's paystub or bank account, we do not have an
accounting problem. We do not have a budgeting problem. We do
not even have a tax problem. Once again we have an integrity
problem, just as real and just as dangerous as the integrity
problem on the spending side.
Let me get more specific on this subject. I will read to the
House some of the promises that the finance minister has made in
the past to taxpayers concerning tax relief. Then I will share
with the House what the taxpayers to whom those promises
supposedly applied actually experienced. Then let us see what
this comparison says about the credibility of the finance
minister and the integrity of his tax relief promises in this
budget.
Promise No. 1 comes from a statement made by the finance
minister in the House on October 13, 1999:
On January 1, as indeed on January 1 of every year since we have
taken office, there will be a reduction in payroll taxes.
It is true that on January 1, 2000, employment insurance
premiums were adjusted downward, but what also happened as a
result of previously authorized changes to the Canada pension
plan was that the combined employer-employee premiums for CPP
went up on January 1 from 7% to 7.8% of contributory earnings.
The payroll tax hike from CPP premium increases is greater than
the payroll tax reduction through the reduction of EI premiums.
Thus many workers experienced not a reduction in payroll taxes as
promised by the finance minister on October 13 but precisely the
opposite, a payroll tax increase. Does one wonder why workers
and employers get cynical when they hear promises of payroll tax
reductions?
Promise No. 2 comes from a statement of the finance minister to
parliament on December 7, 1999:
At $30,000 of income, Canadians no longer pay federal income
taxes as a result of the actions taken in the last two budgets by
this government.
I ask hon. members opposite to listen to that statement. The
finance minister stood in the House and made that bold promise
and declaration. Let me read into the record a letter from Paul
and Fran Darr of Calgary, Alberta, taxpayers. The Darrs write:
We are a retired couple with a total income of $28,000.
If my math is right, that is less than $30,000.
Of that the government sees fit to take almost $4,000 in taxes,
documents attached. Paul Martin has repeatedly declared anyone
under $30,000 does not pay any taxes. Excuse me! This is
written proof. If this is truly the case, we would greatly
appreciate a return cheque for this amount that we had to pay for
1998, ASAP.
Let us look at promise No. 3. Mr. Speaker, do you see the
credibility gap that is developing here? The finance minister
makes these statements and promises. If one goes out to the
taxpayers to whom they apply and asks if they ever saw that tax
relief promised by the taxman, they shake their heads.
Promise No. 3 is from a budget speech. We are getting right
down to promises in the budget. It is from the budget speech of
February 16, 1999, at page 4. The finance minister said:
It is a budget that for the first time in many years offers tax
relief to every taxpayer and it does so without using borrowed
money.
Tax relief for every taxpayer, promised the finance minister.
Let us go out to the offices, the factories, the stores, the
union halls, the seniors' homes, the kitchen tables and coffee
shops where we meet real taxpayers and let us find out about the
finance minister's promise of tax relief for every taxpayer. We
ought to be able to grab any taxpayer off the the street and ask
if they got the tax relief the minister promised on page 4 of the
budget, that he said they would get. Has it got there yet? We
could ask them that. Let us find out how it is working out in
the real world.
1050
Shortly after last year's budget I was in Windsor, Ontario,
where I met a worker at one of the auto plants. He was a union
member. These are highly paid people. He had a paystub for
overtime work in which the total deductions were greater than his
net pay. He not only wanted to know where his tax relief was
that was promised by the finance minister. He wanted to know
whom he was working for. He thought he was working for Chrysler
but according to his paystub he was working at least half time
for Revenue Canada.
On another one of my trips last year I received a paystub from a
millwright in Saskatchewan. His gross earnings for an overtime
pay period were $2,022, but after paying income taxes, payroll
taxes and other charges all he got to take home was $1,009. Gross
pay, $2,022; take home pay, $1,009. It was less than half his
paycheque. On his way home when he stopped to buy gas and a
winter jacket, the taxman gouged him again.
This unsolicited paystub, along with many others I received, is
an example of the very real tax horror stories of Canadians. They
are stories which clearly show that the finance minister's
so-called tax cuts, tax relief for every Canadian, clearly fail
the paystub test. They are living proof that the finance
minister is completely out of touch with Canadian taxpayers. His
claims of so-called tax relief are in direct contradiction to the
actual experiences of many hard working, tax burdened Canadians.
To help illustrate this point further last November we decided
to hold the great paystub rip-off contest. Hundreds of Canadians
responded to the contest by e-mailing, faxing and mailing in
their paystubs and stories to my office. I want to take this
opportunity to give the House a sample of some of the paystub
stories we received and to announce the winner of this most
unfortunate prize.
After I am through, surely even the most obtuse government
backbencher will understand what I mean when I say that this
government has an integrity problem on taxation, a problem of
credibility that comes from promising tax relief to every
Canadian and then failing to deliver it, and an integrity problem
that is every bit as serious as the government's integrity
problem on the spending side.
Here are some of the best entries to the paystub rip-off
contest. Here is one called “pay raise rip-off”. Last year,
Annalora Horch, a teacher who works for a private school board in
Medicine Hat, Alberta, got a $1,000 raise. She was hoping to put
the raise away for her retirement. After taxes, however, Ms.
Horch's $1,000 pay raise left her with exactly $2.67 each month
to put away for her golden years. She was promised tax relief
from the finance minister.
You are shaking your head. I agree, Mr. Speaker, that we should
shake our heads. Let me read the letter:
Please find enclosed copies of two months of my
paystubs—September 1998 and 1999 and October 1998 and 1999. I
work for a private school board in Medicine Hat. My board gave
all the teaching staff a $1,000 raise for this year. I have
never been on welfare or received unemployment. I have worked
since I was twelve years old and am presently helping to finance
my son at university to keep his student loans at a minimum. Any
increase in pay is appreciated so I can save for my retirement.
It was with great anticipation that I waited for my increase.
However, the figures on the stubs tell the true story.
Listen to how taxes kill dreams. They do not just kill bottom
lines. She has the calculation here: $1,000 divided by 12
months, she should be getting $83.33 a month. However, the
paystubs for September 1999 show an increase of $81 in taxes.
October 1999 shows an increase of $81 in taxes as well. She
writes:
I already pay hefty taxes to the government and now it is
increased even more. My much needed raise is not going to me or
benefiting the school. It is going directly to the government
for taxes. This is a great injustice to an honest, hard-working
citizen. It is discouraging. Please, is there some way this
continuing burden of increasing taxes can be alleviated for the
ordinary, middle class worker? We need help and I am appealing
to you to help me and all other taxpayers in this area of
overburdened taxation.
Here is a short letter, signed by “Completely and utterly
ripped off”. A Toronto police constable writes:
In 1999, I grossed $61,000 and after taxes and other deductions
took home $34,000.
This is not some high income person. This is a person we
consider to be in the middle income bracket. He continues:
Every other purchase I make has a further 15% in sales taxes.
When are we ever going to get a break?
Completely and utterly ripped off.
Here is one called “back pay tax grab”.
Adam Grabowski, a full time teacher in Manitoba with 12 years
experience, writes:
I thought you would like to see a copy of a back pay statement I
received in July. We waited a little over 14 months to get this
pay due to negotiations.
As you can see, income tax accounted for a total of $508.33 or
48.6% of the pay. When you add in the employment insurance,
which I can never claim due to my job, and the CPP, which I
believe will not be there in 30 years, the federal government
takes $571.1 or 54.7% of my gross pay.
I am a single income earner with 3 boys all under seven. Tell
me how I can do anything wonderful with my family on the
remaining amount.
1055
These are real taxpayers, the object of tax relief in the last
two budgets of the finance minister. This is their story. Listen
to this one. A single mom sent the following letter to the
member for Dewdney—Alouette. This is a fairly lengthy one but
it is worth reading because it illustrates that taxes are not
just some accounting device. They intrude on the lives of people
when they are too high in ways that destroy people's dreams and
even destroy their lives. The letter reads:
In July of 1993 I found myself the single parent of five children
who worked as a Special Education Assistant. I could not support
my kids off that wage so I got a student loan, the first of many,
and started university where I hoped to become a teacher. Five
hard years later I made it. I didn't think about the debt
because I thought I would be able to make enough to support my
kids and pay the loan back. I loved teaching. I was good at it,
and I got a continuing contract, a permanent position in my first
year of teaching. Now, I thought, I'll be OK. The hard work
would be worth it.
I was wrong! The hard work was worth it because I love what I
do and I value the education I received and the process of
getting it, but I can't survive monetarily. I am a single parent
although I have only three children still at home. With the
level of taxation in this country...I can't make it. Yes, I make
a good wage, but after deductions I still can't buy my ten year
old son winter boots, or my sixteen year old daughter a monthly
bus pass. I am being asked by the student loan people to pay
over $350 per month. If I did that I couldn't buy any food for
my kids. I am not in a better place. I am only deeper in debt!
The taxation level in this country is killing me.
This is not a rich person. This is not the filthy rich the
finance minister and the Prime Minister talk about as being the
beneficiaries of tax relief. These are ordinary Canadians at the
lower and middle end of the spectrum. The letter goes on:
The taxation level in this country is killing me. I have to have
a part time job in order to survive, but I can't leave my kids
alone from 7 a.m. when I go to school until 10 p.m. when I would
get home from my second job!
I love living in this country because there is so much good in
it, but how can I see the good when the burden of taxation is
blinding me? Something needs to be done for people like me who
live on one income, be they single parents or families with one
parent working. I don't need a national day care scheme. I need
tax relief! I would love to be able to go into a store and buy
my son a pair of needed shoes without worrying that I will have
enough money left over so we can eat at the end of the month.
Some people say I should quit and just sit on welfare, but I
can't.
It is my hope that in this new session of Parliament the
government will see just how the average, low-middle income
earner in this country is suffering. I don't want pomp and
ceremony. I don't want Senators to get a fabulous tunnel so they
don't muss their hair in the Ottawa winter. I need relief from
the exorbitant amount I pay each and every month for taxes. I
need a break.
Please feel free to send a copy of this letter to Finance
Minister Paul Martin and the Prime Minister. They obviously
don't live in the real world. I do and I don't like it.
How do we pick a winner from all these? There are no real
winners, only hard working Canadians who lose out to a finance
minister who promises tax relief and then delivers tax increases.
It seems that no amount of income is too small to attract the
attention of the finance minister. The letter we have selected
as the winner strikingly illustrates this point. It comes from
Mr. Paul Meyer, a structural engineer from Montrose, B.C., who
worked half an hour of overtime, and listen to what the finance
minister did to him:
I have enclosed a copy of my two most recent paystubs. I think
they stand as a good example of how high taxation rates in Canada
can be a disincentive to productive workers.
The government says it is interested in productivity. Here is a
letter from a productive worker:
During the two-week period ending November 05, 1999, I was paid
for 80 hours work, while the following period, I was paid for
80.5 hours of work, having put in a half hour overtime.
The half hour overtime increased my gross pay by $19.33.
Amazingly, this resulted in my federal income tax increasing by
$20.13. In effect, I paid the government 80 cents for the
privilege of working a half hour overtime.
I recognize that this is an anomaly caused by “steps” in the
tax tables, but the very fact that a “step” could result in an
apparent marginal tax rate of 104% tells me that our tax rates
are too high. As a resident of British Columbia with a good
salary, my actual marginal tax rate is well over 50%.
I also note that, because it is late in the year, no CPP or EIC
deductions were made from my salary, as I had already “maxed
out” on both amounts for the year. If it were not for that
“anomaly” my apparent marginal rate would have been over 110%.
1100
Paul Meyer is with us here today. We congratulate you, Paul, on
this most unfortunate honour and thank you for sharing your tax
rip-off story for the benefit of the House and taxpayers across
the country.
It is people like Paul who are paying for the $1 billion
boondoggle at human resources and who are paying for all the
past, present and future tax increases not mentioned in this
budget. It is people like Paul who want real tax relief not token
tax relief, not sleight of hand tax relief, not fake tax breaks,
but real tax relief.
I remind hon. members that all these taxpayers whose letters I
have read were promised tax relief in last year's budget, that
all of them feel abused, not helped by the government and that
this is just a tiny sample of 15 million Canadian taxpayers.
The government and the finance minister have a credibility and
an integrity problem on taxation, just as they have the same
problem on spending. It stems from the finance minister's being
totally out of touch with ordinary Canadians, underestimating
their pain, underestimating their intelligence, underestimating
their patience and underestimating their desire for real tax
relief.
It is the role of the official opposition to hold the government
accountable for the management of taxpayers' dollars. We will use
this budget debate to do precisely that. Official opposition
members speaking on the budget are speaking first and foremost
from the standpoint of the long suffering, long abused taxpayer.
We are the voice of those taxpayers and we insist that they be
heard.
I believe that by the time my colleagues and I have finished
with this budget we will have demonstrated to the House and to
any Canadians who are watching that the government is
irresponsible when it comes to spending taxpayer money and
irresponsible when it comes to the taxation of Canadians, and
that lack of integrity characterizes its approach to bothe
spending and taxation.
The official opposition has a second role which is becoming even
more important in the light of the government's mismanagement of
public affairs. And that role is to make sure that a
constructive alternative is available to replace the government
when the day comes that Canadians decide to do so.
It is in the discharge of this responsibility that we have been
working together with others like-minded to bring into being the
Canadian reform conservative alliance, or Canadian alliance for
short.
This is not the time or the place to elaborate on this concept,
but I mention it in the budget debate because one of the great
founding principles of that alliance is genuine fiscal
responsibility; the principle that is missing from the spending
and taxation policies of the government and from this budget.
Under the heading of fiscal responsibility, the alliance policy
package includes proposals for restoring integrity and
accountability to federal government spending. It also includes
a tax reform that will deliver approximately double the tax
relief provided in this budget over the next five years. It is
characterized by a 17% single rate of federal income tax with
generous personal, spousal and child deductions that will remove
more than two million lower and middle income Canadians from the
federal tax rolls all together and deliver the largest reduction
in the federal tax burden ever provided to the Canadian people by
any federal political party.
One of the key MPs who has helped bring this alliance into being
is the member for Calgary Southeast. He also happens to be the
former president of the Canadian Taxpayers Federation and the
official opposition critic for revenue.
He has attended and addressed literally dozens and dozens of
meetings across the country where people have met together to
discuss uniting in new ways to control spending and get the debt
and tax levels down. We should listen to his report on these
activities.
1105
The member of the official opposition who has led the
development of the alliance's position on federal spending and
taxation, including the solution 17 proposal, is the member for
Medicine Hat, the official opposition critic for finance. On
these subjects, he has consulted not only his colleagues in
caucus but also think tanks across the country and supporters of
the provincial administrations of Premier Klein in Alberta and
Premier Harris in Ontario, provincial administrations that have
actually succeeded in delivering real broad based tax relief to
their people.
I would urge hon. members and the public to listen to these
members and other opposition members who are not only devoting
themselves to holding the government accountable for
mismanagement of taxpayers money, but who are endeavouring to
create a constructive alternative to the government. It is
members who advocate genuine fiscal responsibility in practice as
well as in words on both the spending and the taxation side who
represent the wave of the future, and they deserve our full
attention.
I want to conclude by reflecting for a brief moment on the truth
of an old saying which applies to governments as well as to
individuals, the saying that pride or arrogance precedes a fall.
It has been observed that there are two types of arrogance that
bring down governments.
The first is an arrogance that is rooted, sadly, in ability and
accomplishment. It is ultimately offensive to the public and
will ultimately turn voters against an administration. But it is
at least an understandable if not forgivable arrogance.
To illustrate, the Liberal administration of Louis St-Laurent
became infected with this type of arrogance in the early 1950s
and it contributed directly to the fall of that administration in
1957.
The wartime cabinet of Mackenzie King contained probably some of
the ablest individuals ever to serve in a federal cabinet in
terms of sheer ability and accomplishment, the ability to get
things done under difficult circumstances with limited resources.
There is no comparison between King's wartime cabinet and the
front benches of the present government.
Louis St-Laurent, though past his prime by the mid-1950s, was
an able and accomplished leader. Ministers like C.D. Howe, who
had demonstrated enormous capability when he was in the private
sector and even greater capabilities when he was in charge of all
of Canada's wartime production effort, had achieved almost
legendary status.
Unfortunately there is an arrogance that sometimes comes with
great ability, accomplishments and legendary status. Howe was
able and accomplished and he knew it. As the czar of Canada's
wartime production effort, he was used to getting his way. He
was impatient with anybody and anything that got in his way and
particularly got in the way of any of his pet projects.
The project which preoccupied him in the mid-1950s was a massive
pipeline project, the great Trans-Canada pipeline that would
carry natural gas in huge volumes from western Canada,
particularly from my home province of Alberta, into the energy
thirsty markets of Ontario and the American mid-west. My father
was very much involved, as premier of Alberta, in this project
and I know this story from the inside out, not just from reading
books.
A $1 million boondoggle in connection with that project was
brought to the attention of the great man, C.D. Howe, in the
House by the official opposition. Rather than acknowledge the
million dollar boondoggle and deal with it, in his arrogance, an
arrogance rooted admittedly in ability and accomplishment, an
arrogance which by then infected the entire government, C.D. Howe
dismissed the charge with his infamous line “What's a
million?”.
It was that display of arrogance that marked the beginning of
the end of that Liberal administration. The public had just
about had enough and “What's a million taxpayers dollars?” from
C.D. Howe was the straw that broke the camel's back.
There is another type of arrogance, an arrogance that is also
offensive and repugnant to the public. But because it has no
roots in ability and accomplishment, the public find it even more
incomprehensible and insufferable. This is the arrogance of
people and governments who are neither particularly able nor
accomplished but find themselves in positions of great power and
influence anyway. Their power and influence is largely
inherited.
It is built on the abilities and accomplishments of others, of
their predecessors. They enjoy safe seats, not so much for what
they have done but because of what others before them have done.
They fall into power, not because of their abilities or powers of
persuasion but because they were at the right spot at the right
time when somebody else stumbled.
1110
Such administrations do not appreciate the limits of their own
abilities and accomplishments. They have nothing to be arrogant
about, as Churchill observed, but they are arrogant anyway. It
is the arrogance of inherited position and the power that goes
along with it. It is like the arrogance that afflicted the old
monarchies and aristocracies of Europe who believed in the divine
right of kings, who believed they had a divine right to govern
regardless of ability, accomplishment or the impact of what they
were doing on their own people.
It is the arrogance of a Louis XVI and Marie Antoinette,
lounging around the water fountain at Versailles, completely out
of touch with the needs of their people but lording it over them
anyway. In that arrogance of inherited power, responding to the
news that the people of Paris have no bread by saying “let them
eat cake”.
To draw a more contemporary analogy, it is the arrogance of King
Jean I and the member from Grantford lounging around the fountain
at Shawinigan, completely out of touch with Canadians but lording
it over them nonetheless. And in that arrogance, responding to
the news that the people want real jobs and real accountability
for taxpayer dollars by saying “let them eat pork”.
In its arrogance and the mistaken belief that it is governments
that create jobs, this Liberal administration has conceived a
pipeline project. Not a magnificent nation-building project like
the CPR and the Trans-Canada pipeline, but a tawdry politically
inspired project to pipe federal government slush funds into
every Liberal riding, with subsidiary lines into every other
riding where there is a possibility of buying votes.
This time, not a million dollar boondoggle but a billion dollar
boondoggle, has been brought to the attention of the House by the
official opposition with the help of the media and the auditors.
In the House, the minister, who is supposedly responsible, and
the Prime Minister arrogantly deny that a problem exists, and
when the denial fails to calm the storm, the same Prime Minister
arrogantly seeks to dismiss the problem by reducing it from a
billion dollar boondoggle to $250. When that does not work, the
same Prime Minister arrogantly seeks to justify the billion
dollar boondoggle by maintaining that a Liberal inspired pipeline
to distribute patronage tainted pork is acceptable as long as it
winds its way through every federal constituency in the country.
To top it all off, as the supreme act of arrogance—and this is
the feeling that came to me in the lockup when I went through
those budget papers yesterday—the finance minister, who is
supposed to be responsible to parliament and the people of Canada
for the prudent use of taxpayer money, has the unmitigated gall
to present a budget statement to the House which seeks
authorization to collect and spend billions more of taxpayer
dollars while totally ignoring the gross mismanagement of
taxpayer dollars already entrusted to the government.
In other words, in a supreme act of arrogance, the finance
minister presents a budget which, by its glaring omission of the
issue of the day, says to the House and to the taxpayers not
“What's a million?” but “What's a billion?”.
It is that arrogance, not the boondoggle itself, which is bad
enough, but that arrogance of inherited position and power
reflected in the misguided belief that the Liberal Party has some
divine right to govern without any obligation to account for its
failures or abuses of the public trust. It is that arrogance
which when apprehended by the public will mark the beginning of
the end for this administration.
It is that arrogance which demands that the House respond to
this budget, not with fawning approval but by adopting the
amendment which I now place before the House. I move:
That the motion be amended by replacing all the words after the
word “That” with the following: “the House of Commons rejects
the government's budget statement because it totally ignores the
gross mismanagement of grants and contributions by the Human
Resources Development Department, and continues the tradition of
hidden tax hikes and boondoggle-prone spending that denies
Canadians real tax relief”.
1115
The Deputy Speaker: Debate is on the amendment.
Mr. Monte Solberg: Mr. Speaker, I rise on a point of
order. I believe it is the custom of this place for a member
from the government to respond in debate. I believe that is the
situation, but I stand to be corrected.
The Deputy Speaker: I think the normal thing is to
proceed through each party. The Liberals started the debate with
the minister's statement last evening. The official opposition
has had its chance to reply. Now we would normally hear from the
other parties.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker,
yesterday was a great disappointment for me. The heart on my
lapel is not a delayed celebration of Valentine's Day; it is for
the community groups, the people working on behalf of welfare
recipients, people without proper housing and others who are
getting a dirty deal. A dirty deal particularly because the
Minister of Finance has neglected them year after year, for
seven years now, in his budget.
For some time, particularly in the last two and one-half years,
the Minister of Finance has had surplus money coming out of his
ears, but there has been not one measure to meet the needs of
the least advantaged members of our society.
Every year, an alarm is raised about the increase in poverty, in
Quebec and in Canada, a cry from the heart coming particularly
from community groups and the Front des assistés sociaux in
particular. There is absolutely nothing in the budget to help
them. There is no great source of pride to be found in
discussing the budget of the Minister of Finance this morning.
From the social point of view, this budget is a total
disappointment, with the possible exception of the Canadian
social transfer, which is intended to fund health, post-secondary
education and welfare, and which will be $2.5 billion over the
next five years. That averages out at $600 million a year.
In order to re-establish the Canadian social transfer, which has
been cut systematically every year since 1995, what he would
have needed to announce, starting this year, is a reinvestment
of $4.2 billion in the social transfer to the provinces. This
would make it possible to meet the needs of those left lying on
stretchers thanks to the Minister of Finance.
1120
Instead of that, the Minister of Finance preferred using his
surpluses for other purposes by ignoring the needs of Quebecers
and Canadians, sick people and students, and by ignoring the
broad consensus achieved at two consecutive premiers' meetings.
On these occasions, the premiers asked that the Canada social
transfer be restored to its original level, that is before the
Minister of Finance began making deep, drastic cuts and gaining
popularity, thanks to the surpluses coming out of his ears.
In that regard, the budget is a big disappointment.
It is also disappointing to hear the Minister of Finance and his
officials telling us, as usual, that, compared to 1993, there is
more money in the social transfer for health care, post-secondary
education and social assistance, and that they are taking into
consideration the tax points given to the provinces, and Quebec
in particular, at the end of the sixties, to correct a situation
that was persisting.
That situation was the following. In response to the war effort,
the federal government had borrowed the provinces' fiscal
capacities, including income tax. The provinces, including
Quebec, were given back through tax points the tax field
borrowed from them in support of the war effort.
Tax points have been in use for a long time. They do not take
anything away from Ottawa and they are not even recorded as a
type of expenditure or revenue for the federal government.
It is like asking the former owner of a house sold thirty years
ago to fix the roof. In other words, it is no longer any of the
Minister of Finance's business. It is not federal money but old
tax points given away over thirty years ago. It is none of his
business.
What should grab our attention is the government's cuts to cash
transfers. By 2003 it will have cut around $31 billion in
transfers to the provinces for health, post-secondary education
and social assistance.
These are not small amounts of money. This year alone, the
Government of Quebec is out $1.7 billion. This money could be
used to hire 3,500 additional doctors and 4,500 nurses this
year, as well as to invest $350 million in the education sector
and over $350 million, close to $400 million, in income security.
This is an extra $40 a month in the pockets of recipients, which
they are not getting.
We have people coming into our riding offices who are short $40
at the end of the month to make ends meet, to be able to feed
themselves and their children. The Minister of Finance has
decided to turn a deaf ear to the pleas from those on social
assistance and the least well off members of society.
My second big disappointment concerned employment insurance. We
thought, or we would have thought, that the Minister of Finance
had his heart in the right place. But it is now clear that the
Minister of Finance is heartless because six out of ten
unemployed individuals do not qualify for EI and are left on the
sidelines.
The Minister of Finance announced yesterday that even over five
years and despite the fantastic surpluses in the employment
insurance fund, which the government has not contributed to for
a number of years, there will be no improvement in the
employment insurance fund.
Yesterday, I heard the messengers of the Minister of Finance
playing the “there will be parental leave, a great improvement”
tape again. They said the parental leave provided by the
government from the employment insurance fund will be twice as
long as what the Government of Quebec planned to offer pregnant
women.
Yesterday, the Minister of Finance had management, unions and
communities in Quebec saying unanimously that the measure
proposed was so much showing off, for appearance purposes, an
improvement on an empty measure.
In fact, half of the pregnant women will not benefit from this
plan, because they will not be employment insurance claimants.
Some will be unable to take advantage of this, because the plan
covers only 55% of these women's salary. Drawing only 55% of
one's salary over a year makes no sense. Even though the length
of the program proposed by the Government of Quebec was shorter,
the benefits were greater, as was the coverage. In fact, the
Government of Quebec intended to provide coverage for
self-employed women as well.
1125
Everyone knows that this government is in its pre-election mode,
that it is trying to win people over, trying to present people
with window dressing. On the surface, that is all very well,
but when thinking people scratch beneath that surface—and I think
that the intelligence of Quebecers must not be
underestimated—they find there is nothing underneath.
The government's treatment of social housing is a real scandal.
That sector has had an injection of $58 million.
Everyone in Quebec and in the rest of Canada has said that,
right now, the minimum investment required Canada-wide to create
a minimum of new social housing in order to partially meet the
requirements of the most disadvantaged in our communities, who
are paying more than 50% of their income for accommodation,
would be $1.7 billion, not $58 million. That would not be enough
to build even half an entranceway. This is truly scandalous.
The Minister of Finance has not heeded the heartfelt cries of
those in need.
I turn now to the tax cuts. The Minister of Finance is a great
showman, and it is not the first time he puts on a show for us
but closer scrutiny reveals it is all smoke and mirrors.
We do, however, have the honesty to applaud the full indexation
of the tax tables and the tax structure in general. Why?
Because we have been pestering the government, pressuring it,
for seven years—
Mr. René Laurin: Mr. Speaker, I rise on a point of order.
Considering the importance of the issue, could you check to see
if we have a quorum?
And the count having been taken:
The Deputy Speaker: I see a quorum. The hon. member for
Saint-Hyacinthe—Bagot may continue.
Mr. Yvan Loubier: Mr. Speaker, we applauded the full indexation
of tax tables, and we continue to do so, because the Bloc
Quebecois has been fighting for seven years to convince this
government to end this tax injustice whereby, for 14 years now,
taxpayers have been paying an extra $3 billion in taxes every
year. Indeed, without any announcement from the Minister of
Finance about tax rate increases, the minister was collecting at
least $3 billion per year.
We condemned this injustice. In 1995 we even tabled a report
proposing a reform of the personal income tax system. In that
report, our first recommendation to the government was the full
indexation of tax tables to end this systematic robbing of
taxpayers.
Seven years and $17 billion later—because the federal government's
inaction has cost taxpayers $17 billion—the government finally
decided to index tax tables. Let us render unto Caesar what is
Caesar's. Had it not been for the Bloc Quebecois, no one here
would have talked about full indexation.
This year the Minister of Finance would probably have announced
a $2 billion tax reduction without changing anything to the tax
structure. In the end, he would have given $2 billion to
taxpayers while at the same time taking back between $3 and
$5 billion through the back door.
It is thanks to the Bloc Quebecois, the only party in this House
to raise the issue, if this long term adjustment has been made
and if, over the coming years, we will be seeing real tax
reductions, not disguised ones.
Where are the tax cuts that everyone is calling for this
year? There are none, or almost none. The most that the
government has done is to freeze people's taxes at the same
level as last year. That is it.
Next year there will be minimal tax cuts. I will give a few
examples.
There will be no tax savings at all for a family of two adults
and two children with an income of $20,000.
1130
For a single income family of two adults and two children earning
$35,000, the real tax saving this year will be zero.
For a single income family of two adults and two children earning
$65,000, the tax saving this year will be $700—less than $60 a
month.
But the lucky friends of the Minister of Finance and of all his
colleagues, the folks who earn $250,000 and up, are the real
winners this year. Their savings will be $4,796.43.
So much for tax relief.
As usual, the Minister of Finance makes sure that these tax cuts
are for those whose income is $250,000 or more this year. Next
year it will not be all that different.
With full indexing, the tax cuts will happen, but mainly four or
five years from now. In my opinion, those tax cuts need looking
into more closely.
The Minister of Finance gave us an interesting show yesterday,
but if we scratch the surface, we can see that the Minister of
Finance is an expert at making things look good. However, when
the time comes to take really effective measures, he will
certainly not be the one to do so.
Now for agriculture.
This is a particularly important sector and one which has in
recent years been hit with considerable cuts in the successive
budgets of the Minister of Finance, particularly the cuts to
subsidies and the measures aimed at the farmers of Quebec.
After six budgets in which there have been more than
proportional cuts in the federal agriculture and agri-food
budget, it seems to me that it would have been a good idea for
there to have been a little help this year for Quebec farmers in
the form of subsidies.
This is all the more important, crucial even, because of the
impasse in the WTO, where there are no longer any discussions
about subsidy levels in the United States and Europe, and our
international competitors receive two or three times what the
agricultural producers of Quebec do.
How can there be competition against people who are being
subsidized up to three times as much as we are? He ought to
have restored some of the agricultural subsidies so as to enable
that sector to be a front-runner on the international level,
despite this inequity on the international level. He did not.
Everyone deplores this now, particularly the president of the
Union des producteurs agricoles, who said that agriculture had
been completely ignored in the budget. When agriculture was
mentioned in the past six years, it was always to announce bad
news, such as the elimination of certain benefits that had been
in place until then.
I also want to mention infrastructures. There is unanimity
against the minister. Again, in today's newspapers, we can see
that all those who fought for a real infrastructure program to
construct roads, and for other types of infrastructures,
particularly municipal infrastructures, will be very
disappointed. Some of them already are this morning, but those
who were expecting more from the federal government will be even
more disappointed.
Some claim that the opposition can say anything, that its
members are not taking into account the need to achieve fiscal
balance, etc. This is not true. Whenever the Bloc Quebecois has
made proposals, it has always kept in mind the need for fiscal
balance and sound management of public finances. The same cannot
be said of the government opposite, given what is going on at
the Department of Human Resources Development, including the
scandal about the lost billion, the possibility of bribes here
and there and the largesse toward friends.
We redid the forecasts by taking into account the evolution of
the economy over the past three months and the most recent major
criteria for economic forecasts.
1135
We recalculated the Minister of Finance's surplus forecasts for
the next five years and discovered that there will be not $95.5
billion in surplus, but more nearly $140 billion.
With the Minister of Finance we are used to errors in
forecasting verging on 100%. Three months ago, he presented his
economic statement. He forecast a surplus for 1999-00, that is,
the fiscal year ending March 31, of $5 billion. Yesterday, in
the budget, the surplus had reached $7.5 billion. In two months
and a half, he erred by 21%.
There is worse to come. Yesterday, at the time of the budget, I
took out his own department's latest financial review. In the
first nine months of the current fiscal year, the surplus was
already over $10.9 billion.
The Minister of Finance has a real problem. Either he does not
know how to count or he does not know how to estimate or he does
not know how to manage or he does not know what is happening in
his own department, since the figures he gave yesterday, those
of two and a half months ago and those of the same day in the
financial review vary between 21% and 50%.
The problem is that the Minister of Finance manipulates figures.
He is a great manipulator. I will not use any unparliamentary
language, but we need only look at page 20, first column, table
1.2 of his budget plan 2000. It provides for spending in 2000-01
of $4.4 billion he committed in 1999-00.
Already we have $4.4 billion that will be spent later on showing
up in this year's figures.
Why does he do this? To mislead everyone. He talked about a $5
billion surplus. He realizes that the actual figure will be in
excess of $12 billion. He adds $4.4 billion to this year's
figures that will be spent the following year. He reduces this
fiscal's real surplus of $12 billion by a corresponding amount.
At the end of the year, he will crow that he was right on the
mark.
It is really too bad that we are treated to this sort of sleight
of hand.
He also could have brought in tax reform. That is what he did
for individual taxpayers, but we encouraged him to do so for
corporations. He did not follow our advice. Large corporations
are carrying forward far too much in unpaid taxes.
The amounts involved are not small. Year after year, profitable
corporations carry forward over $45 billion in taxes they owe
Revenue Canada.
I will mention just one, Bell Canada Entreprises, which has been
in the news in recent days, which will acquire CTV at a cost of
$2.3 billion. This is approximately what BCE owes the federal
government in unpaid taxes carried forward. Another example is
Bell Canada, which owes $2.1 billion. Seagram owes over $2
billion.
Seagram and BCE taken together represent enough in unpaid taxes
to restore the Canada social transfer, to be able to invest in
health and postsecondary education and help the poorest members
of society. But the Minister of Finance does nothing.
We are keeping our eye on him for the rest of this government's
term of office in order to see that he introduces this reform,
that he stops arranging things to suit his little millionaire
friends, that he gives a thought to the most disadvantaged and
listens to people's pleas.
I move:
1140
The Deputy Speaker: The amendment to the amendment is in order.
The debate is on the amendment to the amendment.
Mr. Roy Cullen (Parliamentary Secretary to Minister of Finance,
Lib.): Mr. Speaker, I wish to begin by saying that it is a great
pity that Canadians listening to this debate do not have an
accurate picture of budget 2000.
[English]
We have heard some speakers who are mired in the past and
speakers who are speaking half-truths. For example, on the
question of taxation we heard about examples from previous years,
but did the speaker talk about what this budget actually delivers
for Canadians?
I will give some examples. A one earner family of four with an
income of $60,000 will see its taxes go down by 24%. Did we hear
that? I do not recall hearing it. The elimination of the 5%
deficit reduction tax on income of up to about $85,000 will help
middle income Canadians. Did we hear that? I did not hear that.
A one earner family of four earning $40,000 will see its net
personal income taxes reduced by 48%. Forty-eight per cent. I
did not hear that in this Chamber just a few moments ago. A two
earner family of four with an income of $60,000 will see its net
income taxes reduced by 27%. Twenty-seven per cent. These are
the facts.
When we talk about transfers, the budget fully restores health
and social transfers to the provinces. In fact, it moves them to
new levels of $30 billion annually. With the equalization
payments, it moves to $40 billion annually being transferred to
the provinces.
It is no secret that the province of Quebec certainly with
respect to equalization payments receives the lion's share. The
Quebec government receives close to $5 billion in equalization
payments. The CHST has fully restored the funding on the
transfers for health, education and welfare.
[Translation]
I wonder if the Bloc Quebecois member would make a small comment
on transfers. Does he have any exact figures, or is this a sort
of make-believe story?
Mr. Yvan Loubier: Mr. Speaker, we are going to talk of reality,
not the inflated statements on the Minister of Finance's tape,
as replayed by his parliamentary secretary.
Does he want to know about tax savings? A family of two adults
and one child, with a single income of $65,000, will save $700
this year, which is barely $60 a month. That is a lot, is it
not, $15 a week?
Taking the same family of two adults and one child, but with two
incomes totalling $65,000, they will save $250 this year. Wow.
Some tax cut. This is wonderful.
If I had had the time earlier, I would have also talked about
the inflexibility of the federal tax system as far as Quebec is
concerned. I will give some examples, if I may. Quebec gives
tax credits for shipbuilding, but they are then taxed by Ottawa.
There is also inflexibility as far as deducting student loan
interest is concerned.
Since student debt load in Quebec is less than in the rest of
Canada, our province is not getting its share regarding that tax
deduction. This is an example of the inflexibility of the
federal tax system.
1145
Then there is the deduction for daycare costs. Everyone wants to
copy Quebec's $5 a day daycare program, but the federal
government has turned a deaf ear when it comes to making the
necessary tax adjustments. Some families in Quebec will lose tax
deductions, because they are claiming less in daycare expenses
from the federal government. The tab is $70 million.
I could have talked about this inflexibility.
Yesterday, it was announced—and I would have done it earlier if I
had had the time—that the super deduction for research and
development the Quebec government—through the Minister of
Finance, Bernard Landry—had announced in its budget last year, a
measure similar to what has been done in Ontario for ten years
with the hundreds of millions received by Ontario businesses
through federal deductions for research and development, is
quite simply a thing of the past.
Businesses did not even have six months to take advantage of
that deduction, while Ontario companies had ten years to benefit
from the hundreds of millions of dollars given by the federal
government.
To those who claim that federalism is beneficial to
Quebec, I say think again. It was demonstrated again yesterday
that when Quebec has a good idea, Ottawa turns a deaf ear,
because the Quebec government would look too good.
When there is a measure that is good for economic growth, the
government scraps it, as it did with the excellent Quebec
research and development deduction. That is what is meant by
federal flexibility.
I am tired of hearing about transfer payments being at the same
level as in 1993. That is not the case. They are lumping cash
transfers and tax points together. Tax points were transferred
in the late 1960s. We wish the government would quit trotting
out this tired old refrain. No one takes it seriously any more.
The truth is that provincial governments are out $4.2 billion
every year, and the Government of Quebec is facing a $1.7 billion
shortfall in health care funding.
It is the fault of the federal government that people wait so
long in emergency rooms and on surgery lists. It is the fault
of the federal government that hospitals are closing, because,
by 2003, it will have cut transfer payments for health,
post-secondary education and social assistance by $31 billion.
Members opposite should stop obediently playing the same old
tapes, and the government should do its job.
Mr. Odina Desrochers (Lotbinière, BQ): Mr. Speaker, I obviously
fully support the remarks by my colleague from
Saint-Hyacinthe—Bagot on the economic and social consequences
of the budget presented yesterday by the Minister of Finance.
I have in my hand an article published today in Le Droit. I
think with my colleague's expertise we have a good idea how
federalism is cost effective in Quebec. The article concludes
by saying:
Even with the natural increase in the performance of the tax
points, Ottawa's total contribution has increased from $30
billion to $32 billion in ten years, a miserable increase of .06% a year.
It then says:
In all, with all transfer payments combined, for each Quebecer,
cost effective federalism is $1,566 as compared to $1,600 when
Robert Bourassa left politics ten years ago. This does not
warrant a speech by the current Minister of Intergovernmental
Affairs—
I would ask my colleague if he agrees with these remarks and if
he can tell us in greater detail how the current budget will
impoverish Quebec further this year.
Mr. Yvan Loubier: Mr. Speaker, I thank my colleague from
Lotbinière. What he has just said is quite right. I will
simply take one cut to show that Quebec is doing more than its
share in absorbing cuts and is therefore poorer than the other
provinces in Canada as the result of the actions by the Minister
of Finance. Let us consider the cuts decreed in the 1995 budget
in the Canada social transfer, with which, it must be
remembered, Quebec was to fund health care, post-secondary
education and social assistance.
The plan for the cuts, which began in 1995 and will conclude in
2003, will mean that Quebec alone will suffer of some $16
billion of the $31 billion in cuts decreed by the Minister of
Finance. This is over 50% of the cuts.
1150
Quebec is going to suffer 50% of the cuts to the social
transfer, while it represents only 24.5% of the Canadian
population. Is this fair? Is this equitable? Absolutely not.
Looking at R and D expenditures—this should be heeded by those
subservient Liberals from Quebec across the way, because we have
been saying this for 20 years over and over, and they still
haven't got it—we have not received our fair share of federal
government goods and services expenditures and structuring
expenditures. We are $2.5 billion in the hole every year.
Telling us that this system represents enrichment for Quebec
is false.
My colleague from Lotbinière has done well to raise this aspect
of the question.
[English]
Ms. Louise Hardy (Yukon, NDP): Mr. Speaker, I know that
Quebec has a very large northern region and I was wondering if
the member would elaborate on how devastating this budget is when
it comes to health care in northern areas that depends on
Medivac.
[Translation]
Mr. Yvan Loubier: Mr. Speaker, by not restoring the transfer
payments via the Canadian social transfer to their 1993 levels,
the people whom the hon. member represents will be hard hit,
because it is already experiencing problems with health care
funding.
With the population growth that region is undergoing, the needs
are becoming more and more urgent and pressing. The Minister of
Finance has decided to keep the people of the Northwest
Territories and the Yukon waiting once more, as he has for the
past two and a half years.
It must not be forgotten that the surplus started two and a half
years ago, and the Minister of Finance has managed so far to
avoid any debate on its allocation, by concealing and disguising
it, as he has again this year.
We must not believe that the surplus will be $5 billion, as he
has announced. It will be $12 billion instead, this year.
He could, therefore, have done far more to improve the health
sector in the hon. member's riding and elsewhere, but has
decided not to. At best, he is going to invest $2.5 billion,
but over the next five years, so that will be $500 million
yearly. This figure represents about 12% of annual
requirements, according to the figures given by the provincial
premiers and territorial leaders.
[English]
Hon. Lorne Nystrom (Regina—Qu'Appelle, NDP): Mr.
Speaker, I rise to say a few words on this very important budget
debate today. I remember the Minister of Finance in London last
fall saying in his financial update that we were into the age of
a surplus.
When we get into the age of a surplus we can start looking at
the values of a society in terms of where we want to invest our
money and in terms of the new fiscal dividend. It is a new era.
It is a new age. It is a new chapter in terms of where the
country wants to go.
Because of that I looked forward to this budget with a great
deal of interest as the dawning of a new age, a new era, a new
direction for Canada. Because we have turned the deficit corner
what would the fiscal dividend be used for?
We listened to the Canadian people and we heard a great deal of
optimism about reinvesting in people, health care, education, a
children's agenda and the farm crisis, all kinds of things for
ordinary people and bringing down some taxes that affect them
such as the GST, bracket creep and others as well.
If we go back to 1995 we notice that the fight against the
deficit was carried out by a radical slashing of social programs,
the most radical slashing we have ever had in Canada. It was
much more radical than any Conservative government under Brian
Mulroney or John Diefenbaker or any other Tory in the history of
the country had ever done. The Minister of Finance slashed and
burned social programs in Canada to the point where social
programs such as health care are in jeopardy today.
Then came last night. Last night the minister rose in the House
to present his budget. I thought for a while I had a health
problem. I thought I had a hearing problem. I kept hearing the
Leader of the Opposition but I kept seeing the Minister of
Finance. I checked with my colleague from Kamloops and he was
adjusting his glasses. He was looking around. He saw the
Minister of Finance but he thought he was hearing the Leader of
the Opposition.
What we had last night was a very important paradigm shift by
the government, moving in a sharply conservative direction from
the past history of Canada, from the past history of the Liberal
Party.
We had a very conservative tax cutting budget.
1155
I checked more closely and watched the Leader of the Opposition.
He was embarrassed. He was blushing. He looked very red in the
face because what the Minister of Finance was saying remained the
things the Leader of the Opposition had been advocating for the
last two or three years. Meanwhile the Minister of Finance was
boasting and bragging about the new direction in which the
country was going.
A friend of mine has some very appropriate buttons. I should
not mention another member's name in the House but I can read
what the button says: “Paul Martin for UA leader. Paul Martin
for leader of the United Alternative”. The Leader of the
Opposition may have competition for the leadership of a new
conservative party.
What we have seen very importantly is a paradigm shift. We had
the deficit fought on the back of social programs. We expected
that once we got to a surplus position the social programs would
be reimbursed, that health care would be reimbursed, that
education would be reimbursed, and that people who had paid for
the fight against the deficit would all of a sudden get the
positive result of a fiscal dividend. However the opposite
happened.
We now have the smallest government we have seen in the country
since 1949-50 in terms of government spending and government
programs. The 2000-01 fiscal year spending on government
programs will amount to 11.6% of the GDP. That is down some 5.3%
from 1992-93 when government spending was 17.5% of the GDP in
Canada.
Investment in government programs has dropped by $4 billion
since 1993-94, the year Brian Mulroney left office and the
current Prime Minister came into office. In the budget speech
the government boasts about this radical downsizing of the public
sector and federal government programs. That is a drop of $4
billion at a time when inflation is gradually increasing costs,
when government revenues are going up and when the affordability
is there to expand government programs for health care,
education, homelessness and farmers. There is a cutback of $4
billion in terms of government programs which help ordinary
people.
There is a shift in values. I ask where those good old time
Liberals are, the Lester Pearsons. After its start in
Saskatchewan he started a national health care program that
brought in the Canada pension plan. Where is Pierre Trudeau?
Where is Paul Martin Senior, the national father of many of our
social programs who boasted about building social programs and
expanding them when they became affordable? Where are those old
time Liberals?
In the House today many Liberals are hanging their heads in
shame as they think back to the legacy of the Liberal Party which
tried to build some social programs and to invest in government
policies. Those programs are now gone. Where have they gone?
Some of them are in the Senate. Others have just gone out of
politics, but where is the legacy of the old Liberal Party?
We have had a radical downsize like we have never had before in
terms of government programs and social programs. Instead of
spending about 75% in terms of health care, education, the farm
crisis, children and senior citizens, in the budget for fiscal
year 2000-01 about 25% of the surplus is going into these
programs and 75% will go into tax cutting and cutting back on the
national debt. It is exactly the other way around to the way the
priorities should be. We should be reinvesting in people.
I want to look at some of the interesting facts. In the next
four years they are projecting tax cuts of $58 billion. The
spending on transfers to the provinces for post-secondary
education, health care and other social services will be $2.5
billion: a billion this year, a half billion next year, a half
billion the third year and a half billion the fourth year. That
is $58 billion for tax cuts and $2.5 billion for health and
post-secondary education. For every dollar that goes to cut
taxes, some two pennies go into increases in health care.
1200
What does that mean?
Two days ago I was visiting a person in the Pasqua Hospital in
Regina. I talked to some of the nurses about the crisis in and
the shortage of health care. No matter where we go, whether it
is the Pasqua Hospital or any hospital in the country, we get the
same story about health care being in crisis.
The federal government in the days of Paul Martin Sr. and Lester
Pearson funded health care on a 50-50 basis with the provinces.
What is it today? Today, under the son of Paul Martin Sr., about
13 cents or 14 cents on the dollar comes from the federal
government, depending on the province. It is no wonder that
Liberals hang their heads in shame in the House today with this
kind of track record.
What does it mean in my province of Saskatchewan? Over the next
four years this $2.5 billion will mean $80 million to the
province of Saskatchewan. That is enough to fund health care for
one day, two days or three days in those four years. I suspect
it will be the same in Manitoba, New Brunswick, Nova Scotia or
any of the smaller provinces in the country. That is what the
Liberal Party is giving us, funding for health care for an extra
three days in the province of Saskatchewan.
In fact the effects of this budget will be even worse in
Saskatchewan. Because of the changes in the tax system our
province will be at a net loss in terms of what it receives in
transfers from the federal government. There will be an extra
$80 million in transfers, but a loss when it comes to the change
in the tax system because our tax system, except for Quebec, is
piggy-backed on the federal tax system. It is no wonder there is
a great deal of shame across the way.
Years ago the Liberal Party would boast about the role of
government and the public sector in building a strong network of
social programs to help Canadians who need help. The Liberals
are now changing on a dime. They are intimidated by the Leader
of the Opposition, intimidated by the Reform Party. They have
slashed $4 billion from government spending since they took
office from former Conservative Prime Minister Brian Mulroney.
It is no wonder the Canadian Medical Association is saying that
there is not enough money in the budget for health care. It is
no wonder the people are worried about an American style of
health care, two tier health care coming into the country. What
the Minister of Finance did last night was open the floodgates to
the possibility of the American style of two tier medicine. The
federal government is not paying its fair share of the cost. At
13 cents or 14 cents on the dollar, when it used to be 50 cents,
the government is inviting the provinces, in particular Alberta,
which has the cash, to implement a two tier system of health
care.
I remind the House that in the United States 48 million
Americans are not insured for health care. They are mainly poor
people, black people, people living in inner cities and people
living in rural areas. That is the kind of vision the Minister
of Finance has in mind for Canada. It is not the Canadian way.
It does not reflect Canadian values. It is not what Canadians
are telling MPs from one end of the country to the other. That
is not the way we want to go in the New Democratic Party.
We need more money for health care. We need more money for
education. We need more money to invest in ordinary people and
in services for people. That did not happen last night. Last
night there was a shift in the values of the Liberal Party, which
is adopting the agenda of the Reform Party. That is why the
Leader of the Opposition was blushing. He did not know what to
say. All he could talk about last night in front of the cameras
was HRDC and how the government had spent money in those programs
over the last two or three years.
I turn for a moment to education and the children's agenda. A
number of months ago the Prime Minister spoke of a children's
agenda. Where is that children's agenda? It is not there. Where
is the extra money for education? The extra money, except for a
small portion of that $2.5 billion over four years, is not there.
It is not there at all.
If we want to build a stronger country and a more competitive
country, if we are concerned about the so-called brain drain,
then the place where we should start investing immediately is in
the children's agenda, in child care, in early childhood
development and in post-secondary education so that we can invest
in human resources, training and education to create in the
future a workforce that is second to none in the world and one
which will build this country into a strong country in the next
century.
1205
That is the vision and that is the direction in which we should
go. Instead, the income gap is widening. There are more and
more people living in poverty. There are more and more kids
living in poverty, more and more kids without opportunities some
10 years after we passed a resolution to eradicate child poverty
by the end of the last century. Now we have the money. Now we
have the surplus. What does the Liberal government do? It
decreases spending in proportion to our GDP rather than increase
it. It is the agenda of the Leader of the Opposition and members
of the Reform Party. They have intimidated the Liberal Party,
which has responded in kind by bringing in their agenda, which is
not the way that Canadians want to go.
I would like to speak about the farm crisis. We have the worst
crisis in the farming sector in Saskatchewan and Manitoba since
the 1930s. We have had protests. We have had people being
forced off the land. We have had bankruptcies. We have farm
stress. We have had people committing suicide. We have had
people on hunger strikes. We have had tractor demonstrations.
We have had questions put by members of this party in the House
of Commons for the last year. We have had delegations led by
Premier Romanow and Premier Doer.
With all the protest, the lobbying and the questioning that is
going on, what did we get from the federal government? We got a
measly $240 million last week, when all the major farm
organizations in the prairies were saying that they need a
minimum of $1.3 billion for Saskatchewan and Manitoba if they are
to survive, seed crops next year and the year after and maintain
the family farm. That is all they got. There was nothing added
in the budget.
Last night there was nothing in the budget about a long term
farm program, which prairie farmers are saying should be based on
the cost of production. That would give them some guarantee that
they would get back at least their costs and a decent income in
the years that lie ahead. Where was that vision? That vision
was not there, despite the fact that European farmers are being
subsidized to the tune of 56 cents on the dollar by the treasury
in Brussels and American farmers are subsidized by 38 cents on
the dollar, while our Canadian farmers get 9 cents.
Agriculture has taken the biggest hit next to social programs
from the Minister of Finance and the Liberal government with the
elimination of farm support programs and the Crow rate over the
last few years. Now that we have a fiscal surplus, what is there
for farmers? Mere peanuts for farmers and nothing in terms of a
long term vision.
This is a paradigm shift in Canadian politics. We are seeing
the Liberal Party shift to the right and adopt the agenda of the
Reform Party in terms of fiscal conservatism, in terms of the law
of the jungle and people having to make it on their own in terms
of the marketplace.
It does not matter where we look. Take, for example, the CBC.
There was not a penny last night for the CBC. There was very
little for arts in terms of a vision for our country, taking our
country back and standing for Canada and our identity.
There was very little for international development in terms of
playing a role in the third world.
There was nothing for parks.
I want to mention taxation. There were some good things done in
terms of indexing the taxation system and increasing the basic
exemption. After our party has been pushing, year in and year
out, for a fair and progressive move for the ordinary Canadian
citizen, the Liberals finally listened to this party and to the
Canadian people and indexed the taxation system.
At the same time they had to throw something to their wealthy
friends. They are going to change the capital gains system so
that instead of being taxed on 75% of capital gains, people will
be taxed on only two-thirds of their capital gains. Someone who
is a wealthy person and makes $200,000, $300,000 or $400,000 a
year in capital gains will get a major tax break compared to the
ordinary citizen.
It is the same with RRSPs. We can now invest 20% of our RRSPs
in foreign markets. That is a considerable expenditure by
ordinary Canadians, amounting to billions of dollars a year. Now
the government, despite what the Canadian people are saying,
wants to increase that to 25% and then to 30%. The taxpayers of
this country are subsidizing people to invest in the economies of
the United States, Asia or Europe, and yet it is the taxpayers'
money. These things are going in the wrong direction.
In the remaining time that I have I want to put a bit of a human
face on the budget that we saw last night. We have been in touch
with a few people this morning and we have heard different
reactions to the budget. For example, we spoke with John, who is
a currency trader in Toronto. He is one of those guys in red
suspenders. He was very happy last night. In fact, this morning
he had a bit of a hangover from popping all the champagne.
He was happily toasting the Minister of Finance because he made
$200,000 in capital gains. With that kind of capital gains he
will have an extra $8,000 in his pocket because of the change.
It was not a bad budget for John. It was no wonder he was
popping the champagne and munching on caviar as he watched the
Minister of Finance deliver a budget that was good for him
because of the capital gains exemption.
1210
We also heard from Donna. Donna is not like John. Donna is a
high school teacher. She earns $60,000 a year and comes from a
one earner family of four. Next year she will get a tax cut of
$1,007. By 2004 she will have a tax cut of $1,477. What does
this tax cut do in terms of lost services for Donna? She has
children in university. She sees tuition fees going up, and yet
there are no increased transfers for education and health.
In 1990-91 the average arts tuition at the university where her
son went was $1,496. In 1999-2000 that tuition had gone up to
$3,370, a hike of 125.9%. The reason is that the federal
government has not kept up its transfers to the provinces for
post-secondary education.
The Liberals have help from their friends in Ontario, like Mike
Harris, whom they seem to worship nowadays. By the way, Mike
Harris increased spending on government programs at the same time
that this government decreased spending. We have a government
that is even more Conservative than Mike Harris. Donna is a net
loser as a result of the budget of last night.
We heard from André, who is a student. What is in the budget
for him? Nothing at all. Tuition fees will not go down, they
will go up. There is nothing new in student loans for André.
We heard from a retired couple. Milfred and David live in
Kamloops. They make $30,000 a year. They will see their
personal taxes reduced by $546 a year, or $1.50 a day. Through
the tremendous generosity of the Minister of Finance, by 2004
they will be able to go to Tim Hortons to share a couple of cups
of coffee, if they are small cups. They would sooner see that
money invested in the health care system and education for their
grandchildren than in $1.50 to buy a cup of coffee at Tim
Hortons.
Doug is from my hometown of Wynyard. He will make probably
$2,000 or $3,000 next year. He may get an $8,000 payment from
the federal government. He will not be paying any income tax.
There is nothing in the budget for him. There is nothing more
for farmers. There is nothing for their cost of production.
There is nothing for him.
This budget is very unfair in the way it treats ordinary people.
We need a vision in which we invest in people, social programs
and health care; not a budget and a government which governs for
the wealthy.
Mr. Sarkis Assadourian (Brampton Centre, Lib.): Mr.
Speaker, I followed the comments made by my colleague from the
NDP very closely.
He forgot to mention that full indexation of personal income
taxes will cost the government $6.3 billion, which will go to the
taxpayers. He never gave the government credit for that.
Headlines in the Globe and Mail read: “$13.3 billion in
additional spending will go mainly toward health care, research
and education”. The Winnipeg Free Press read: “It's
payback time: Martin slashes $58 billion in taxes and puts an
end to bracket creep”. Further, former NDP MP, Doug Fisher,
said: “Finance Minister Paul Martin knows the nation's financial
situation has been improved under his stewardship”.
The other point I want to bring to his attention is that he
mentioned that last week the federal government gave Saskatchewan
and Manitoba $240 million. Who is complaining? The premier of
Saskatchewan was very happy. I do not know who speaks for
Saskatchewan, the premier or the hon. member.
Hon. Lorne Nystrom: Mr. Speaker, I did mention
indexation. We have advocated full indexation for our taxation
system for years. I am glad the government has finally listened
to the NDP and the ordinary people and has done something on the
tax side which will help ordinary people in Canada.
The concern I have is that at a time when the government should
be investing in people, it is not doing that.
1215
Take a look at the government's budget books. I will only refer
to the budget in brief because the big budget might be a bit more
complicated for the member across the way to go through.
On page 18 of the budget in brief, we find that in the fiscal
year 2000-01 the government spending initiative is to be $1.2
billion. Its tax cut initiatives are $3.5 billion. It will set
aside some $4 billion in terms of contingencies and prudence
which will probably be spent on the national debt. In the next
year 2001-02, spending will be $3.1 billion, tax cuts of some $7
billion and it is setting aside $5 billion for the national debt.
We can see what its priorities and values are. Its values are
not investing in people, the health care system, education or the
farm crisis. Its values are not the values of the Canadian
people and not the values of the Liberal Party of old.
Mr. Ken Epp (Elk Island, Ref.): Mr. Speaker, I
appreciate the opportunity to set the record straight. The member
in his speech made some comments about the Reform Party's
position on health care. I point out to him and to anybody else
who happened to hear those scurrilous statements that they were
false and what follows is the truth on the matter.
The Reform Party is, has been and I presume will be, a party
that listens to the people. We are a grassroots party. From the
beginning Canadians have told us by our own membership polls and
other indicators that we have had from many public meetings that
health care is priority number one.
It is true it has always been our highest priority. All one
needs to do is to look at the literature. Instead of simply
spewing back what others have said about us incorrectly, look at
the actual literature from our various campaigns. Look at what
we have actually proposed. It has always been a high priority.
We have a great commitment, contrary to what they are saying
about us, to the health care system. It is our number one
priority. We would like to prop up and buy some more equipment
for hospitals instead of fountains in Shawinigan.
I wanted to put that on the record. I do not know whether the
member wants to comment on it or whether he has another
scurrilous comment to make. Unfortunately that is what happens
in these debates but I wish he would simply stay with the truth
and recognize that is what our party is about.
Hon. Lorne Nystrom: Mr. Speaker, I remember going to the
Reform convention as an observer. I heard them talk about tax
cuts that amounted to $104 billion over five years when the
federal Department of Finance was projecting a surplus of about
$100 billion over five years. Reform wanted to spend the entire
surplus on tax cuts.
If one is doing that, we are not even going to keep up to the
increase in inflation in terms of health care and education. We
can see what kind of priority health care is for the Reform Party
of Canada. The other thing about the Reform Party of Canada is
that it supports Ralph Klein in a two tier American style health
care vision for our country. The Reform Party of Canada stands
for that.
Canadians want a single tier national health care system as
supported and enunciated in the Canada Health Act. Our party and
the Canadian people stand for that. We want to fund the national
medicare program. We want to bring back federal funding.
Canadians stand for that and the Reform Party stands on the
opposite side of that. It wants two tier American style
medicare. That is not what Canadians want.
Mrs. Elsie Wayne (Saint John, PC): Mr. Speaker, is the
hon. member from the NDP aware of what was brought down yesterday
in the budget? When it comes to the CHST, only 2% will be going
into the total Atlantic region. Ninety-eight per cent will go to
central Canada and out west.
People back home put a think tank together. Our people will be
hit extremely hard. I will read what was said by the minister of
finance back home in the province of New Brunswick.
He said that there is an imbalance in the Canadian federation
with Ottawa hoarding all the money while the provinces are left
holding the bag on the country's most expensive program, health
care. I want to say that when a province only gets 2%, it is not
even coming up to the 1993 level.
1220
This is a very serious situation which must be addressed by both
sides of the House. Was the hon. member aware of that? Are all
my colleagues in the House aware of what took place here
yesterday?
Hon. Lorne Nystrom: Mr. Speaker, the member of the
Conservative Party makes an excellent point. I am aware of it.
I fully agree with her. The premiers of Atlantic Canada, the
Liberal premier and the three Tory premiers, have said the same
thing as the two NDP premiers on the prairies, Romanow and Doer,
that last night's budget will be a net loser in terms of
transfers to the small provinces.
In my province alone, the transfer will be about $80 million for
health care over four years. That $80 million for health care,
according to the premier in his comments this morning, is enough
to keep the hospital system going for three days in Saskatchewan.
It is even worse than that when we factor in the tax changes.
The tax systems in all of our provinces, and I am talking to the
member from New Brunswick, are tied to the federal tax system.
Because there are changes to the federal tax system, there will
be tax losses in the smaller provinces. The four smaller
provinces in the Atlantic, Saskatchewan and Manitoba will be net
losers as a result of the transfers that were announced by the
Minister of Finance last night.
That is a really sad commentary when the smaller and poorer
provinces are the net losers in terms of the transfers and social
programs. It is about time we had a new vision that put people
first, that invested in people first.
The government is far more conservative than any Conservative
government we ever had under Brian Mulroney or John Diefenbaker.
We now have $4 billion less in terms of government programs than
we had in 1992-93 despite the fact that the cost of living has
gone up and despite the fact that government revenues have
skyrocketed since 1992-93. I commend the member for her
question.
Mr. Nelson Riis (Kamloops, Thompson and Highland Valleys,
NDP): Mr. Speaker, I got a letter from a constituent. It
says, “I appreciate that the Minister of Finance said that he
has a significant surplus in this year's budget. Did he not get
this surplus by dipping into the EI fund, money that was set
aside by employees and employers for people who lose their
jobs?” What is my colleague's view on this question from my
constituent?
Hon. Lorne Nystrom: Mr. Speaker, the hon. member's
constituent in Kamloops is absolutely right on. The reason we
have a surplus is that the EI fund has gone into surplus and that
goes into the general revenues. What should be happening is that
the benefits should be expanded. Only about 35% of the people who
are now unemployed qualify for benefits, under 30% of women and
15% of young people. We should expand the benefits like we used
to have them a number of years ago.
Mr. Scott Brison (Kings—Hants, PC): Mr. Speaker, last
night when the finance minister introduced his seventh budget
there was much anticipation about what the budget could do for
the standard of living of Canadians, for the prosperity of all
Canadians. Canadians will be very disappointed with the budget
once the dust has settled.
There have been seven budgets, we could say seven deadly sins
from the finance minister. Again the missed opportunities of
this budget will hold Canadians back when they should be rushing
forward to seize the opportunities of the 21st century.
The government is big on labels. The 1998 budget was the
education budget and the year after that, 12,000 graduates in
Canada declared bankruptcy. The 1999 budget was the health care
budget and over the past year, hospital waiting lists have
continued to grow in Canada. Canadians remain uncertain about
the future of health care. They do not believe their health care
system will be there when they need it. That was the result of a
health care budget.
This year we have seen the tax cut budget. Before this budget,
we had the highest personal income tax rates in the G-7 and the
second highest corporate tax rates in the OECD.
Well, guess what? After this budget we will have the highest
personal tax rates in the G-7 and the second highest corporate
taxes in the OECD. There is no change because as we take these
baby steps forward, other countries are taking gigantic leaps
forward.
1225
The government is working with a $150 billion surplus. It says
it is going to devote $58 billion over five years to tax
reduction. It is including the elimination of bracket creep and
the reindexing of tax brackets in that.
The fact is this is not a tax cut. This is a cancellation of
future tax increases. To promote it as a tax cut is disingenuous
at best.
We are pleased with the reindexing of tax brackets. We have
been calling for it for three years. It was a deficit reduction
measure and once the deficit was gone we wanted to see the tax
brackets reindexed. We are pleased that finally the government
has taken a page out of our book on this.
With this budget the government continues to look inward when it
should be looking outward. The government is ignoring the global
realities that are occurring around Canada while bragging about
progress within Canada.
Progress within Canada frankly is in many ways irrelevant if we
are simply comparing ourselves to our past performance. It has
nothing to do with the reality of how we are going to build a
stronger economy and increase the standard of living of all
Canadians and the levels of opportunities for all Canadians.
In this hypercompetitive global environment, we do not write the
rules, but we ignore the rules at our own peril. Other countries
have embraced these global realities earlier. In response to
these global changes, our trading partners have pursued policies
of lower taxes, less regulation and lower debt. The levels of
growth have been striking.
Ireland's real GDP per capita growth has been 92% from 1988 to
1999. Corporate tax reductions helped in Ireland because it drew
capital, entrepreneurs and investors to Ireland to create a
greater level of economic growth. GDP per capita has increased in
the U.S. during the same period of time by 18%, and in the U.K.
and in Germany by 14%. Yet in Canada our GDP per capita growth
has only been 5% during the same period.
We are stagnating while other countries are progressing. While
citizens in other countries are getting richer, in Canada we are
getting poorer. In the 1990s we have seen an 8% drop in our
personal disposable income or take home pay in Canada. During
the same period, Americans have enjoyed a 10% increase.
With this budget the government has opted for baby steps with
regard to tax relief and tax reform. The progress that Canadians
expect to make as a result of this budget simply will not
materialize because as we take these microsteps forward, other
countries are rushing forward with much more visionary approaches
and much more gigantic steps and leaps.
Canadians may gain some comfort from seeing the directional
shift of the government on taxes. However with the mobility of
capital and the mobility of people that exist today, we cannot
afford to be one nanosecond behind our trading competitors.
It used to be that high taxes redistributed income. In the
current technologically driven global environment, high taxes
redistribute people. That is what we are seeing.
Perhaps one of the most damning barometers of how we are doing
is the unprecedented level of brain drain in this country. Young
people, in particular our best and brightest people, are leaving
Canada to seek greater levels of opportunity elsewhere.
Over a 10 year period we have seen the number of Canadians
seeking opportunities in the U.S. grow from 17,000 people per
year to almost 100,000 people per year. Some of our best and
brightest, the types of people we need to build a stronger more
productive society, are choosing to go elsewhere to seek greater
levels of opportunity.
Capital gains taxes are a major contributor to the brain drain
because increasingly, Canadians particularly in the high tech
sector are compensated with stock options. After this budget is
fully implemented, effective capital gains rates will still be
13% higher than the effective capital gains tax rates of the U.S.
It would cost about $70 million to $80 million, not billion, per
year for the government to equalize our capital gains tax regime
with that of the U.S., but it is not doing it.
1230
The reason why it is not doing it is that the government is
dealing with perceptions. It is not dealing with realities. In
reality, effectively oppressive capital gains tax regimes will
continue to drive innovators out of Canada. When we lose those
innovators, when we lose that investment, we lose the jobs, the
growth and the entrepreneurial energy that Canada needs to move
forward.
In our tax task force report tabled in January we were calling
for a reduction of capital gains taxes in Canada to the U.S.
effective levels by reducing our inclusion rate to 50%, not 66%.
That step would have put us on a level playing field with the
U.S. in the very important areas of capital gains and taxation.
Unfortunately the government in its incrementalism has missed the
boat again and as a result Canadian entrepreneurs will be held
back.
The government also had an opportunity to adjust tax brackets to
a more realistic level reflecting global realities. Unfortunately
again it failed to do so. Moving the top marginal tax bracket
from $60,000 to $70,000 is a pathetic, tiny step in the right
direction.
The government could have used the opportunity it had to reform
and reduce taxes to redefine Canada's middle class. Instead the
government believes that Canadians making $70,000 should be taxed
as if they are rich. One does not hit the top marginal tax rate
in the U.S. until he or she is making an income of $400,000
Canadian. Yet in Canada we are taxing those making $70,000
Canadian as if they are rich.
This means that a high tech worker in Vancouver making $70,000
per year will be taxed at the top marginal tax rate of around
52%, federal and provincial combined. A high tech worker in
Seattle, an hour and a half away, making the same level of income
will be taxed at a 26% marginal rate. Do we wonder why these
people are leaving?
The starting wage for most MBA graduates from Canadian schools
is over $70,000 in technology driven companies or the financial
industry. We are sending those people out of Canada. We are
telling them that we do not want their innovation, their brains,
their sweat, work and efforts to build a better country. However,
the U.S. wants young Canadians because they are well educated,
bright, hardworking, the best in the world and will build a
better country. Unfortunately that greater country will not be
Canada because of the government's backward thinking policies.
That greater country will be the U.S.
Don Goodison of the Canadian Certified General Accountants
Association, said after the budget last night that it was not
good enough. If he were contemplating moving south of the border
this budget would not keep him here. The current Prime Minister
has suggested that young Canadians should leave the country if
they are unhappy with Canada's taxes. I am afraid that he may
get his wish. Sadly, when we lose the best and brightest young
people, we lose the capital and talent necessary to create a
greater level of prosperity for all Canadians.
On the digital highway of the global economy Canada has fallen
two years behind the U.S. in e-commerce. Silicon Valley is full
of expatriate Canadian innovators who are there not because they
want to be but because they needed to access the entrepreneurial
environment and capital necessary to grow.
Canada's comparatively high tax regime has driven over $135
billion worth of investment from Canada over the last 10 years.
Access to capital is critical in the high tech sector,
particularly in the incubational stages. While there are
Canadian high tech innovators here the government is making it
very difficult for them to stay.
We are proud of our new technology success stories like Nortel
or JDS Uniphase. We are proud of the new economy startups like
Versus Technology, Bid.com, Leitch Technology, EcomPark, Imagic
TV from Saint John that is riding the wave of the future of
convergence of technology, and Hemosol, a cutting edge biotech
industry player that is emerging in Canada. We are proud of all
these ventures.
1235
We believe that the CDNX can be Canada's NASDAQ or NASDAQ north,
financing Canada's future and creating greater levels of economic
growth. For that to happen, the government has to recognize the
power of technology and the power of the opportunities facing
Canadians. It should stop getting in the way and start helping
the Canadian technology industry seize the future.
We need to do more than simply to retain Canada's best and
brightest. We need to develop a high tech industrial strategy
that attracts innovators from other countries to Canada. With
the death of distance as a determinant in the cost of
telecommunications, with the quality of life advantages in
Canada, particularly Atlantic Canada, and with the highly
developed post-secondary education infrastructure in Canada—and
coming from Atlantic Canada I am very proud of our post-secondary
education infrastructure—these are advantages we can utilize to
succeed in the global environment, not just to compete.
I believe that Canada can be a world leader, not a world
trailer. We can lead the world of innovation if we actually
start producing policies designed for Canadians well into the
21st century, instead of merely focusing on policies that may
give the Liberals a bump in next week's polls.
The government should be striving to develop a tax system as it
applies to the technology sector that is not almost as good as
the U.S. system but in fact in some ways is better than the U.S.
system. As I mentioned, we are two years behind the U.S. in the
very important area of e-commerce. We are now entering a period
of growth in the biotech industry. In fact it is a biotech
revolution. We still have an opportunity. I see our health
critic here. He is very interested in the future of biotech as
it applies to the Canadian health care system and health reform.
This can be an opportunity for Canada. If we change our
policies now, we do not need to be a laggard. We do not need to
be held back. We do not need to watch the U.S. and other
countries move ahead. We can actually ride the wave of the
biotech revolution, create jobs and opportunities, and reform our
health care system at the same time.
On the debt issue, the finance minister was ignoring warnings
from economists that Canada needs to set out a more aggressive
debt reduction strategy to reduce the debt in real terms. The
former Liberal finance minister, Donald MacDonald, has asked the
government to reduce the debt that he helped to create in the
1970s.
This $570 billion albatross costs Canadians $40 billion per year
in debt servicing charges. By not addressing the debt issue more
seriously, the Minister of Finance is forcing future generations
of Canadians to face the issue he continues to duck. Debt
reduction may not be the most politically exciting way to invest
a fiscal dividend in the short term, but reducing Canada's debt
in the long term is the best way to ensure that we can continue
to afford the social programs and low taxes that we value as
Canadians.
At current levels of debt reduction it would take 150 to 200
years to eliminate the accumulated debt. The finance minister is
crowing that within five years Canada's debt to GDP ratio will be
down to 50%. The situation in France and the U.K., for instance,
has allowed those countries to have debt to GDP ratios of 40%
now, and we are saying we strive to have a debt to GDP ratio of
50% in five years.
In terms of health care, probably the greatest single
disappointment in this budget is its failure to address the real
needs of Canadian health care. At one time the federal
government shared the cost of health care equally with the
provinces. Fifty cents of every dollar spent on health care was
spent by the federal government. In recent years, particularly
under this government and its draconian slashing of the CHST
transfers, that share has been reduced to 13 cents on the dollar.
Only 13 cents of every dollar spent on health care in Canada come
from the federal government. The $2.5 billion over the next four
years is frankly a drop in the bucket.
Health care expenses in Canada are growing in some estimates of
upward of $2 billion a year due to inflation, population growth
and the aging population. The increases the government is
promoting do not even keep track with the increase in the expense
in health care.
1240
This investment hurts provinces like mine in Nova Scotia. It
hurts all provinces, but Nova Scotia Premier John Hamm said that
without full restoration of the health transfers cut in the fight
against the deficit Nova Scotia health care standards would slip.
They have already slipped under this government. We have seen
the health care system in Nova Scotia and across Canada
deteriorate significantly.
Even Brian Tobin, Premier of Newfoundland, wannabe Liberal
leader on the other side of the House some time and perhaps a
future competitor for the holy grail of Liberal leadership, is
saying that the government missed the boat by not reinvesting in
health care.
Mike Harris, Premier of Ontario, said that we could not deliver
the quality of health care we are delivering today with declining
dollars from the federal government.
The Canadian Health Care Association said that the budget's
announcement of an additional $2.5 billion over four years did
not recognize the severity of the current health care crisis in
Canada.
This budget has virtually ignored the agricultural crisis in
Canada. When it talks about the agricultural crisis the
government believes that if it is not grown in the west it is not
agriculture anyway. It is ignoring the plight of farmers in the
west, but at least it is talking about the agricultural crisis in
the west. It does not even talk about the agricultural crisis in
eastern Canada and we have some real problems in Atlantic Canada
in terms of an agricultural crisis.
On defence, since 1993 the government has cut 23% from defence
spending. The budget's anemic attempt to reinject a bit of much
needed cash into defence falls far short of what is actually
needed. In an increasingly complicated global environment we are
asking our soldiers to do more and more. Instead of giving them
more to do that, we are actually paying them less and less.
Quality of life issues are paramount.
On equipment, we are sending helicopters up in the air with
baler twine and duct tape holding them together. The government,
which is only reinvesting $1.9 billion over the next several
years in defence, was willing to spend half a billion to cancel a
helicopter contract for political reasons. The government is
more focused on short term politics than on the long term needs
of Canadians. Canada spends less on defence as a percentage of
our GDP than any of our NATO partners except Luxemburg. After
this budget Canada will still be spending less on defence on a
per capita basis than any other country except Luxemburg. It is
an embarrassment.
On infrastructure, the government's reinvestment in
infrastructure is an insult to the provinces. It means that
highways like highway 101 in Nova Scotia will not be twinned.
Death traps in some of our provinces will not be addressed. The
$100 million this year for the infrastructure program is nothing,
given the cost of what needs to be done across Canada with the
municipalities and with the provincial governments.
One of my disappointments with this budget was that the Minister
of Finance in the estimates is giving the HRDC minister an
increase in her blank cheque of $1.3 billion in this budget.
Instead of cutting her allowance we are giving her more money.
The Minister of Finance must have been wearing his boondoggle
blinders when he wrote this budget. For the past two months
Canadians have been focused on waste in the HRDC department and
in other departments. The minister has ignored this fact.
We could have lower taxes. We could have better spending on
health care. We could have better spending on defence, highways
and agriculture if the government had the courage to ensure that
Canadian taxpayer money would be invested carefully instead of
wasted rampantly.
We need more vision if we are to lead the way into the 21st
century. I believe Canada can do it, but only if the government
seizes the day and starts to recognize the opportunities and
challenges facing Canadians.
1245
Mr. Roy Cullen (Parliamentary Secretary to Minister of
Finance, Lib.): Mr. Speaker, I am quite surprised. The
member for Kings—Hants is a member of the finance committee and
I would have thought he might have read the budget. He covered
so much terrain and there are many areas in which there is much
misinformation. I would like to focus on a couple.
First of all, on the CHST and the transfers to the provinces,
the member cited a 13% increase. As I indicated earlier and as
the budget papers clearly portray, the cash portion of the
transfers, which is only one part of the transfer as there are
tax points as the member full well knows, is increasing with this
budget by 25%. In fact, the CHST has been fully restored. If we
throw in equalization, it is at a level of about $40 billion in
transfers to the provinces.
He talked about making business more competitive. The budget
reduces the corporate tax rate from 28% to 21% for the highly
taxed sectors. That is a pretty bold move. It takes the 21% rate
and for small businesses applies that immediately for income
between $200,000 and $300,000.
He talked about access to capital and incubation of small
companies. If he turns to the budget papers, he will realize
that the budget introduces taxation benefits for stock options,
the capital gains treatment of stock options. That will help
businesses, start-ups and particularly those in the high
technology sector. If he read the budget papers, he would
realize that the government has introduced capital gains tax
remission for companies that roll over their capital gains and
put it into small businesses and start-ups and part of the
invigorating part of our economy.
If he actually read the budget, he would discover that the
capital gains tax inclusion rate has been reduced from
three-quarters to two-thirds.
If he read the budget, he would understand that it puts close to
$2.4 billion into defence.
I could go on and on but I think the member should read the
budget before he comes to the House. Normally he is most
informed on these issues. I was surprised today. Has the member
read the budget?
Mr. Scott Brison: Mr. Speaker, I appreciate the
non-partisan intervention from my colleagues opposite.
The hon. member asked if I read the budget. I did read the
budget. But had he been sitting in the House when I gave my
speech he probably would have heard a little more clearly what I
was saying. I did not say 13%. I said 13 cents. Just to
reiterate, the government feels it is appropriate for the federal
government to only pay 13 cents of every dollar spent on health
care. Clearly that is not consistent with what the Canada Health
Act has set forth when it was 50%. I expect the hon. member has
been clarified on that one.
When we talk about global competitiveness issues I am not
surprised the hon. member is confused. As a party that fought
free trade and thought it was a bad thing, clearly his is not a
party that can actually put together the types of policies that
Canadians need to compete in a global environment.
Corporate tax reduction is very important. After this budget is
fully implemented, Canada's corporate tax rates will go from
being second highest in the OECD to being fourth highest in the
OECD. That is assuming that over the next five years no other
OECD countries reduce their taxes. In fact 28 of the 31 OECD
countries plan to reduce corporate taxes. We will be just
catching up in five years to where we should have been much
earlier.
An hon. member: Five year plans did not work in the
Soviet Union and they will not work here.
Mr. Scott Brison: The government is focused on five year
plans. As my hon. colleague just mentioned, five year plans did
not work in the former Soviet Union and they probably will not
work here either.
The government is constantly playing catch-up and unfortunately
Canadians are trailing when we should be leading.
On the capital gains tax regime, the hon. member opposite
boasted that the government has reduced the inclusion rate from
75% to two-thirds. If he had been listening to my speech, he
would have heard me reiterate the PC Party's position of reducing
it to a 50% inclusion rate which would have provided an effective
capital gains tax regime equal to that of the U.S. Instead the
effective capital gains tax regime after the government's budget
will still be 13% higher than that of the U.S.
1250
The member believes that he should be boasting about a system
that is 13% more oppressive in Canada than in the United States.
Capital gains taxes impede productivity. They hurt initiative.
They punish entrepreneurs and they damage the Canadian economy
and the potential for us to grow in the future. And he is
satisfied with a 13% disadvantage in Canada. He may be satisfied
but I am not satisfied. My party is not satisfied with that and
Canadians will not be satisfied with that kind of response in the
next election.
Mr. Mac Harb (Ottawa Centre, Lib.): Mr. Speaker, my
colleague is trying to have it both ways. Let us talk about the
economic health of the country. The Conservatives came to power
back in 1988 and by 1993 the deficit was about $42 billion. The
debt moved from $170 billion in 1988 to over $400 billion in
1993. It is fairly clear as history shows and it is documented
everywhere that if this government had followed the Tory
traditions of the late eighties and early nineties, by the year
2003-04 there would have been a zero transfer payment in the
areas of health care and education.
This government first had to put the nation's fiscal house in
order. It would have to eliminate the deficit. It would have to
control the economic situation. It would have to reverse the
trend of tremendous cuts the previous government had made to
social programs and the spending of the previous government.
We have put the nation's fiscal house in order. We have
controlled the debt. We have controlled the deficit. Now we are
beginning to invest, unlike what those guys have done. Every year
from 1988 to 1993 the Conservatives said they would reduce the
deficit and they never once met their objectives or targets. Why
should Canadians believe them when they say that they are going
to do a better job than we are doing?
Mr. Scott Brison: Mr. Speaker, I appreciate the hon.
member's intervention. I believe the hon. member was elected in
1988 during a campaign in which he railed against free trade. As
a member of parliament he has subsequently railed against the
GST. He has railed against the deregulation of financial
services, transportation and energy. He has fought all those
structural changes that were implemented by the previous
government. He fought against every single one of those
cornerstones of the new economy.
There was an interesting article in The Economist
magazine's 1998 preview. It said that credit for the deficit
reduction in Canada belongs to the structural changes made in the
Canadian economy by the previous government. It listed free
trade. It listed the GST. It listed deregulation of financial
services, transportation and energy. I would like to know why
the hon. member when he was in opposition fought against all
those changes and why now as a Liberal government member he is
taking credit for the results.
The Liberal members are the patron saints of hypocrisy if they
believe they can sit in the House today and attack the
Conservative record. Those Conservative changes have enabled the
present government to eliminate the deficit with the help of
Canadians who have seen their taxes rise and their services
slashed.
[Translation]
Mr. Jean-Guy Chrétien (Frontenac—Mégantic, BQ): Mr. Speaker, the
late Quebec Premier Maurice Duplessis often said “Instruction is
like alcohol, not everyone can handle it”.
For the party currently in power, the surpluses are a little
like alcohol, they are having a hard time handling them.
1255
I saw earlier the member for the City of Ottawa have a fit of a
sort in the House. I would ask my colleague who represents a
riding in Nova Scotia to explain what his electors said when the
member and his minister announced they were prepared to give
$100,000 to the Senators, millionaires who earn $1.2 million a
year on average, whereas the ordinary folks have to struggle to
bring in $30,000 or $40,000.
[English]
Mr. Scott Brison: Mr. Speaker, the proposed hockey bailout was
a significant indicator of the degree to which the government has lost
touch with Canadians. At a time when Canadians have seen their take home
pay drop by 8% in the 1990s and have seen Americans enjoy a 10% increase, $100
million for hockey was not the right step. There is a homeless
crisis in Canada. Children are suffering. Child poverty is a
very important issue that has not been addressed by the
government in the budget.
It is appalling that the government wanted to spend $100 million
on professional hockey. When we look at it, the hockey players
and teams in Canada are like the canaries in the old coal mines.
They would put canaries in the coal mines and if the gases became
toxic or noxious, the canaries died. They would then know they
would have to change the environment.
The tax system and the oppressiveness of our tax burden is
killing Canadian industry. It is hurting the high tech sector
and the hockey players. Instead of dramatically changing the
environment in Canada, rather than this tax tinkering, the
government is putting gas masks on the hockey players. The rest
of us need to breathe and succeed in this country too. All
Canadians need broad based tax relief and tax reform, not just
hockey players.
Mr. Roy Cullen (Parliamentary Secretary to Minister of
Finance, Lib.): Mr. Speaker, I am especially pleased and
honoured to participate in the debate on our government's first
budget of the new millennium.
It is a budget that builds on the foundations we have put in
place in past budgets. It also takes historic new action to turn
our nation's better finances into better lives for Canadians.
This budget makes use of hard won surpluses to raise the standard
of living for all Canadians, to enhance their quality of life and
to prepare our economy to succeed in the new century.
[Translation]
Each of the key measures we have taken directly relate to the
needs and concerns reported to us by Canadians from across the
country in the prebudget consultations.
They include of course a fourth consecutive increase in funds
for health care and education, a $2.5 billion increase.
In addition, a five year tax reduction plan reintroducing
indexing into the federal tax system reduces the intermediate tax
rate and, overall, will cut taxes by at least $58 billion by
2004.
This will mean an annual tax saving of 15% on the average, and
more for families with children: targeted spending to make our
economy more innovative, and increase help for children and the
environment.
[English]
While many of these measures speak clearly, confidently and
concretely for themselves, some do not need further advocacy or
explanation from me.
My colleagues will focus more fully on the benefits to Canadians
of our five year tax reduction plan, including the reductions of
the high tax burden at the middle income level and increased
support for families and children.
Earlier the Leader of the Opposition cited a number of examples.
Unfortunately I do not have enough information on some of the
individuals he cited in terms of their marital status or whether
they have children.
I would like to speak to Paul and Fran Darr of Calgary, Alberta.
They are a retired couple with a total income of $28,000.
I would like to tell them that with the measures we are putting
in place in this budget their federal income taxes will be
reduced by 45%. I am sure they will be pleased to hear that.
1300
They need to check their facts with the Leader of the
Opposition. I think they were living in the 1998-99 era and that
some of the measures we put in place in 1998-99 were not even
reflected in some of those figures. Canadians deserve the facts
and those are the facts. Paul and Fran Darr will save 45% in
federal income taxes by the year 2004.
Others in the House will elaborate on our targeted smart
investments in health care, our knowledge and innovation and the
environment. Others will elaborate on the fact that along with
last year's budget we have fully restored Canada health and
social transfers to the provinces which will reach a new peak of
close to $31 billion in 2000-01.
However, there are a number of measures I want to highlight
today. Some are major and some are less glamorous, but they all
demonstrate how we are living up to our commitment to keep Canada
as the best place in which to work, to live and to raise a
family.
Let me begin with the budget's announcement that we are
restoring full indexation to the tax system. I know this is not
as glorious as the direct tax cut rates that we are delivering
but it is vitally important. That is a fact. It is not just
partisan politics. Just ask business groups and tax experts
across the country. It is no accident or corporate conspiracy
that they have universally and consistently called on the
government to restore the protection against tax inflation that
was virtually abandoned by the previous Tory government in 1986.
Last week, for example, the Canadian Institute of Chartered
Accountants put reindexation at the top of its list of budget
recommendations. As a chartered accountant myself, I can say
that is right on.
In recent weeks just as many commentators and critics were
warning that our government would not reindex the personal income
tax system. They thought that because indexation can be more
difficult to explain to the public than other types of tax relief
and because once it is in place and there is no annual political
bang for the buck, restoring it would not be in our best
interest. Now there is political cynicism.
Maybe it was not the expedient thing to do but it was the right
thing to do. That is why I want to especially congratulate our
Prime Minister and the Minister of Finance for their courage.
They have put the interests of Canadians, especially low income
Canadians, such as seniors on fixed pensions, ahead of partisan
political advantage. It is something every member of the House
should be proud of.
Why is restoring indexation the right thing to do? It puts an
end to bracket creep and gives people real and permanent tax
relief. It protects taxpayers against hidden tax increases
caused by inflation. Without indexation, if we were to receive a
2% pay raise it would just cover inflation. Our real income would
not have grown at all. For many low income Canadians that unreal
raise forces them onto the tax rolls while middle income earners
find themselves pushed into a higher bracket. In other words,
their incomes have not really gone up but their tax bite has.
That is just not fair and that is why, now that the deficit is
behind us, we are putting that protection back into the tax
system and more money back into the pockets of Canadians.
Indexation will also stop the erosion of the value of benefits,
such as the GST credit, the Canada child tax benefit and the old
age credit. Without indexation, these credits, designed to help
those in real need, are slowly eaten away by inflation year after
year. Now these amounts will automatically increase to offset
inflation keeping their real value and their ability to provide
real help.
In the years ahead our decision to restore indexation will leave
every Canadian better off. But the ultimate foundation for
personal prosperity is a good job. To make sure those jobs are
there for people we have to make sure that Canadian companies are
internationally competitive.
That is why our 2000 budget takes action to make the tax system
more conducive to investment and innovation. For example, over
the next five years the corporate tax rates that apply to the
highest taxed sectors, such as high technology services, will be
brought down to 21% from the current 28%. That means that all
our different industrial sectors will share a level playing
field.
1305
The budget will also reduce the income inclusion rate for
capital gains from three-quarters to two-thirds and will allow a
$500,000 tax free rollover for qualifying investments in new
small business ventures.
I realize this sounds very technical and complex. Let me just
emphasize the goal here. A key to starting up new, innovative
and high risk businesses is the availability of risk capital. The
tax free rollover will give such businesses, especially high tech
start-ups, greater access to capital from what are called angel
investors.
Many employers share ownership plans and stock options to
encourage employees to become participating owners of their
businesses, most notably in the fast growing high technology
industries. Tax rules that apply to stock options and employee
share ownership plans have been under review to ensure that they
remain appropriate as the economy evolves.
In this budget we announced that up to $100,000 in stock options
granted annually by companies to employees will be taxed only
when the shares are actually sold instead of when the options are
exercised.
[Translation]
The objective here is a simple one that makes sense. Stock
options are one way of encouraging employees to play a greater
role in the development of the company in which they work. The
high tech sector in particular will benefit from this measure,
which will help it to attract the best innovators and
entrepreneurs to Canada and keep them here, resulting in the
creation of jobs for Canadians.
[English]
Another example of a budget measure that will make Canada more
competitive is the new export distribution centre program. This
will virtually eliminate the GST and the harmonized sales tax
cashflow costs borne by export oriented businesses that add only
limited value to products in Canada. These businesses will be
able to import and buy inventory in this country without paying
the GST or the HST. For these companies the new program will
alleviate the cashflow burden because currently they have to pay
the tax up front and then wait to claim it back when they file
their sales tax returns.
Mr. Speaker, you can understand why, as an accountant and former
corporate executive, I wanted to highlight some of the tax
actions that would not normally grab the public eye or the ears
of the opposition.
I now want to return to a broader issue and remind the House of
the fiscal achievements that have made our budget 2000 action
plan possible.
Just seven years ago, when we came to office, the yearly federal
deficit was a huge $40 billion. We needed one-third of our
annual revenues just to pay interest on the debt that two decades
of deficits had built. Now financial results for the first nine
months clearly indicate that a balanced budget or better will be
recorded again this year, 1999-2000. That will mark our third
consecutive balanced budget or better for the first time in
nearly 50 years.
This underscores the soundness of the government's fiscal
strategy using two year rolling budget plans that are based on
prudent planning assumptions, backed by a contingency reserve,
but also pursuing strategic investments to support economic
growth and job creation.
Our bottom line is clear: The government is not prepared to
risk a return to deficits. The benefits from maintaining sound
public finances, sustained economic growth, more jobs and higher
incomes for Canadians will not be put at risk. In fact, this
year's budget commits the government to balanced budgets or
better for the coming two years in the budget track, 2001 and
2002. This will mark five consecutive years of balanced budgets
or surpluses.
1310
Since Confederation there have been only two other occasions
when the Government of Canada recorded balanced budgets for at
least five consecutive years: in the 1920s and again in the
later 1940s through to the early 1950s, the period of
demobilization following World War II.
How does this fiscal progress stack up internationally?
[Translation]
According to the accounting standards used by our G-7 partners,
this year, in 1999-2000, Canada will post its fourth budgetary
surplus. No other G-7 nation, not even the United States, has
accomplished such a turnaround between 1992 and 1999.
[English]
Let me say again that by the accounting standards used in most
other countries, the federal government will post a financial
surplus for the fourth consecutive year in 1999-2000. In fact,
we are the only G-7 country to do so, including the United
States.
Let me point out that this is not just a federal success story.
[Translation]
The financial situation of the provinces and territories will
also have improved for the seventh year running in 1999-2000. As
a result, the total deficit of the Canadian public sector will
have dropped to its lowest level in over 20 years. This means
that Canada is the G-7 country whose financial situation between
1992 and 1999 has improved the most.
[English]
It is this ability to turn around federal finances, thanks to
the support of Canadians across the country, that now makes it
possible for us to deliver dramatic new tax cuts and make key
investments in health, education, children and the environment.
There is another benefit we are seizing; that is to make
continuing progress on debt reduction. Under the debt repayment
plan, we will again set aside a $3 billion contingency reserve
each year to ensure that we continue to achieve balanced budgets
even if economic problems arise. When the reserve is not needed
it will automatically go to paying down the debt.
Through this approach, total public debt has declined by $6.4
billion over the last two years, producing a $300 million yearly
saving in interest costs. Financial market debt will have fallen
by almost $20 billion by this March 31.
More importantly, the federal debt to GDP ratio has declined
each year since 1995-96. This ratio, which measures the size of
debt in relation to the economy, is generally recognized as the
most appropriate measure of the debt burden as it measures the
ability of the government and the country's taxpayers to finance
it.
In 1995-96 the debt to GDP ratio reached a post-war peak of
71.2%. By the end of this fiscal year it will have fallen to
61%. This ratio is expected to decline to 55% by 2001-02 and
fall below 50% by 2004-05.
Achieving strong finances has not come easy. It has taken tough
action, including careful control of program spending; that is
all federal spending except debt interest charges. That is a
commitment we will never abandon. The proof is in the budget
figures.
[Translation]
Between 1997-98, when we first balanced the budget, and 2001-02,
the increase in program spending should correspond to inflation
combined with demographic growth. This is the standard used by
most economic observers.
In fact, even allowing for the
measures announced in today's budget, program spending next year
will be $4 billion less than what it was when we took office.
Expressed as a percentage of the economy, another key measure,
federal program spending will continue to drop, reaching 11.6%
in 2001-02, that is its lowest level in 50 years.
1315
[English]
Since we have balanced the budget fully two-thirds of our new
spending has been on priorities of Canadians such as health,
higher education, access to skills and knowledge, and innovation.
Having said that, there are areas where the government has
responsibilities and obligations within Canada and outside its
borders, responsibilities the official opposition party clearly
shirks from. They include farmers, the homeless, the RCMP, the
military, our national infrastructure, clean air and clean water,
just to name a few.
The future of Canada and its people is looking brighter all the
time. The deficit is eliminated. The debt burden is falling.
Our unemployment rate is at the lowest level in more than 20
years and the disposable income of Canadians is on the rise.
These favourable economic developments are setting the stage for
a better quality of life for all Canadians. Balanced budgets
have paved the way for tax cuts and increases in the Canada child
tax benefit. They have made possible increased transfers to the
provinces and territories for post-secondary education and
health.
The measures in the 2000 budget will move Canada further along
the path to greater prosperity, security and opportunity in the
future. I ask all members of the House to put aside partisan
rhetoric and look at the real results of this budget, at what it
will deliver to Canadians, and support it wholeheartedly.
[Translation]
Mr. René Laurin (Joliette, BQ): Mr. Speaker, I would like the
hon. member for Etobicoke North to explain what he means by a
courageous movement to pay off the country's debt.
As we are speaking, the debt is $579 billion. For the last three
years of the plan, it will remain at $576 billion. At a rate of
$3 billion per year, supposing we apply the government's
provisional reserve for the debt, it will take Canadians 192
years to eliminate the debt. The debt does not bother the
federal government too much.
What really bothers the federal government is the assistance it
could provide to the provinces to help them overcome the daily
problems that confront them. All the provinces agreed that the
priority was health care. All Canadians, including Quebecers of
course, need additional resources to pay for health care.
Everyone agrees that it is the top priority.
The federal government does not recognize that because, in
order to carry out this priority, it would have to go through
the provinces and give them more money to provide the services
for which they are responsible.
Instead of meeting the essential needs of Quebecers and
Canadians, instead of meeting them via the provinces, the
federal government has opted for impoverishing the provinces
still further by keeping them in a position of dependency, so
that they will be increasingly unable to act, even in areas that
are set out as their jurisdiction.
What then are the heroic gestures the federal government has
taken to meet the essential needs of the people? Why does the
federal government not allocate any significant amount to
solving the problem of Canadians' health? Is that what the
budget's generosity is all about?
If there had been no budget last evening, Canadians and
Quebecers would not have gone all year without noticing, because
the significant effects will not kick in for two, three and four
years.
Where does the heroism of the government lie? Where is the
government's sensitivity to the needs of taxpayers clamouring
for health services, educational services, and more money for
poor children? Where is the federal money for this year?
1320
Mr. Roy Cullen: Mr. Speaker, in my opinion, we are talking about
two contradictory things, because the Bloc Quebecois member is insisting
that the government increase its transfers to the provinces.
[English]
At the same time they argue that we should be reducing the debt.
I can tell the House that our government is balanced in its
approach. With respect to the debt, I think something Canadians
should understand is that we do have a significant amount of
debt.
[Translation]
What the hon. member is forgetting is that when the economy
improves so does the percentage of the debt in relation to the
size of the economy.
[English]
Since we have been in government the debt in relation to the GDP
has been reduced from 71% to 63%. It will go further down and it
will reach 50% in the next three or four years.
I liken it to when people first purchase a house and take a
mortgage, those of us who have been able to do so. In the first
stages they look at the mortgage in relation to their income. As
their income grows, in those cases where it does, they are able
to carry a higher mortgage
Yes, we are concerned with the debt, but we are managing the
debt in the context of a growing economy and the capacity of the
economy to sustain that debt. If we suddenly paid down a huge
amount on the debt it could actually have a dampening effect on
the economy. We want to continue the sustained growth in the
last quarter of 4.3% real growth in the economy of Canada.
Mr. Pat Martin (Winnipeg Centre, NDP): Mr. Speaker, the
Minister of Finance and further Liberal speakers have been trying
to tell the House that this budget is a product of a broad
consultation process, that they went around the country and
listened to Canadians.
If that is true, they might have done a lot of consultation but
they sure did not listen to Canadians because the overwhelming
majority of Canadians said over and over and over again at every
opportunity that they wanted the health care system fixed.
This should have been and could have been the health care budget
that put the wheels back on our health care system, which
everybody knows is ailing. We heard instead a paltry $2.5
billion over four years for health care, education and social
assistance. In my home province of Manitoba this represents $20
million per year for health care, social assistance and
post-secondary education.
How can Liberal members try to say that they have put money back
into health care and they have done what is necessary to breathe
new life into our ailing health care system with a paltry
contribution like that? That is my comment.
Would the hon. member like to comment on the source of the
surplus the Liberals are now spending in various ways? Would he
not admit that much of the surplus is actually the EI surplus? We
have a perverse form of Robin Hood where unemployed workers, who
used to be able to enjoy the benefits of EI, are having their
pockets picked so the Liberals can flip it back into tax cuts for
corporations and capital gains tax cuts for the wealthy. Will
the hon. member please try to defend that position?
Mr. Roy Cullen: Mr. Speaker, with respect to the
budgeting process in Canada it is the most transparent and open
process that exists. We implemented cross-country consultations
where Canadians had the opportunity to come and present their
views to the Standing Committee on Finance. The department and
certainly this caucus reach out to talk to people. I do not know
about members opposite.
Let me just give the House something that came out yesterday.
This is a press release from the Canadian Taxpayers Federation
which says that bracket creep is dead, taxes are coming down and
the Minister of Finance listens to the people.
When the member opposite talks about transfers to the provinces
and investments in health care, I do not know if he has forgotten
already but he should recall that in the last budget the
government made the largest single investment in health care that
we have ever made of $11.5 billion.
If we add the $2.5 billion in this year's budget, it fully
restores and more the CHST levels from 1993 to an all time high
of $30 billion. These are the facts. That includes tax points
and cash. I would like the member to read the section on the
transfers. It might inform him better.
1325
Mr. Monte Solberg (Medicine Hat, Ref.): Mr. Speaker, for
the record, transfers are still way down at $400 per person
compared to 1995.
The member stated that Canadians would receive $58 billion in
tax relief. I would argue that those figures are wrong.
Nevertheless, will he acknowledge that almost $30 billion of that
tax relief will be effectively erased by the hike in Canada
pension plan premiums, being mindful that what Canadians care
about is their bottom line, their disposable income? Will he
acknowledge that is exactly what will happen and on their
paystubs Canadians will not see anywhere near the relief the
government has promised?
Mr. Roy Cullen: Mr. Speaker, when Reform members talk
about paystubs they should at least have the courtesy of bringing
into the House paystubs that reflect today's reality. They bring
in and talk about paystubs that do not even implement the
measures we brought in in 1999.
With the measures this year, and we do not need to go over them
all again, the tax reductions are significant. On average
Canadians will receive a tax cut of 15% and if that is combined
with the past budgets it is an average of 22%. Some Canadians
will receive a tax cut of 45%.
The member talks about the Canada pension plan. With respect,
he still does not get it. I have explained it to him before and
he still does not get it, but I will explain it briefly for the
House. The Canada pension plan is a funded pension plan with
employer and employee contributions. Those funds go into a
separate pension plan. They do not come near consolidated
revenue. Last year we implemented the measures that will keep
the Canada pension plan on a sound footing into the future. The
member needs to distinguish between CPP and other tax reductions.
Mr. Monte Solberg (Medicine Hat, Ref.): Mr. Speaker, it
is my pleasure to rise today in reply to budget 2000. I start by
taking issue with some of the things my hon. friend across the
way has just said. It really goes to the point of what I wanted
to say.
I simply have to point out that this budget is remarkable but
not for good reasons. It is remarkable in two ways: one for what
it says which simply is not true and in another sense for what it
does not say but is critical to maintaining or increasing public
confidence in government.
Just a minute ago we were having a discussion about the $58
billion tax cut. We all saw the headlines. The government
deserves top marks for the PR it has generated in anticipation of
the budget. It has been very good for it.
What will happen, and this is really where I want to go with
this, is that in a year's time when Canadians sit down to take a
look at their paystubs and figure out what the impact of these
big tax cuts are on them, they will be very disappointed. One of
the reasons they will be so disappointed is because of answers
like the one we just got from my colleague across the way.
It was an empty answer. I asked him very clearly what would be
the impact on people's disposable income when they have to pay
out the CPP taxes against the alleged tax relief the government
would deliver. He then went into a long dissertation about CPP
being off budget, being different, and all that sort of thing.
The people do not care. They are not interested in all those
technical arguments, I say to my friend. They are interested in
what will be the impact on their bottom line.
When we take a look at the $58 billion and start to break it
down some interesting things happen. All of a sudden we find out
that the $58 billion tax cut people are so eagerly anticipating
is a chimera. It is not really there. It is a mirage.
When we pull it apart, this is what we find. First, the $58
billion tax cut, all of a sudden, because of the increase in CPP
premiums over the next five years, is reduced by about $30
billion. What was $58 billion is now down to about $28 billion.
That is where we are now. The $58 billion in tax relief which
the government promised really becomes $28 billion over five
years when we factor in the $30 billion that we will have to pay
in increased CPP taxes. We should remember that this is spread
over five years.
1330
Second, about $7.5 billion of that amount is not really a tax
cut at all, it is a social program called the child tax benefit.
The child tax benefit works the same way as all social programs.
The government taxes everyone in the country, and it does that
very effectively, and then it gives the money back to some people
who have children. If that constitutes a tax cut, then I guess
old age security is a tax cut. I guess the guaranteed income
supplement is a tax cut. The fact is, it is not a tax cut. It
was put in by the government to pad its numbers and to make its
tax relief look a lot bigger than it really is. The definition
of a real tax cut is when money is left in people's pockets.
The third point I want to make has to do with the issue of
bracket creep. I applaud the government for following the lead
of this party and other parties in this place which have urged
that the government quit taxing people for inflation. That is
something for which we have been arguing for a long time.
Bracket creep is insidious. It has hurt people. It has hammered
low income Canadians. There is no question of that. We know
that is the case and we are glad it is gone.
It is important that the government be completely honest with
people about the impact on the government's finances, and more to
the point, the finances of individuals. Bracket creep is really
a scheduled tax increase for the upcoming year. If the
government cancels the scheduled tax increases through bracket
creep over the next five years, is that really a tax cut? Do
people have more money in their pockets? Of course not. It is a
bit like the bully shaking down the grade 4 kid for his lunch
money. When the teacher catches the kid and says he cannot do it
any more, the bully turns around and says that he is responsible
for putting even more money into the kid's pocket.
Canadians will not have more money because the government has
ended bracket creep, they will just not face yearly tax increases
because of it. If we take that out, that is $13.5 billion. When
we look at the real tax relief that is being delivered, it is
about $7.5 billion over a five-year period, or about $1.5 billion
a year. It works out to $107 per taxpayer. That is not exactly a
lot of money. It works out to about $2 per week. We might be
able to buy ourselves a cup of coffee at Starbucks, but that is
about all.
We must remember that this comes on top of massive tax increases
which the government has brought forward over the last six and a
half years since it has been in power. At the end of the day
Canadians will be paying more in taxes than when the Liberals
took power.
We would never know that from reading the headline “$58 billion
in tax relief”. What is the net impact? Canadians will still
be paying a lot more in taxes than when the government came to
power, about $700 more per family. That is shameful.
Congratulations to the government. It pulled the wool over a lot
of people's eyes, including some of my friends in the media, I am
sad to say.
The truth is that Canadians will still be paying taxes that are
far too high. I think that many Canadians will see that in their
paystubs as the year progresses and some of these changes are
implemented.
1335
We cannot put groceries on the table with headlines. We cannot
put more money into people's jeans with headlines, and that is
what Canadians really want. They want more money. They want
more groceries. They might even want to buy a pair of jeans, but
they will not be able to do that with this budget because it just
does not leave them nearly enough money.
We argue that instead of giving Canadians a fake break we should
give them a real break. I will say a little more about that
later on when I explain solution 17, the Reform Party's proposal
to dramatically lower taxes for all Canadians and to ensure that
middle class Canadians, whom this government is targeting, end up
with real disposable income in their pockets and not just a
headline which does nothing for them.
I want to touch on something which I mentioned at the outset of
my remarks. There is something glaring which the government
absolutely forgot to mention in this budget. My leader mentioned
it earlier today, but I would like to say a few more words about
it.
I want to point out something that the finance minister said in
his 1995 budget speech. He said that subsidies to business
impede growth. I agree with that. I just do not understand why
he, as the finance minister, continues to rubber stamp all kinds
of subsidies to business.
Three weeks ago the finance minister gave an interview in Ottawa
and he said that government cannot pick winners but losers can
pick government. Truer words were never spoken. There have been
many losers who have not only picked the pockets of this
government, but, by extension, those of the taxpayers of Canada.
Yet the finance minister sits in his place every year and rubber
stamps more cheques. They go to the human resources minister, to
the Indian affairs minister, to the industry minister and to the
Canadian heritage minister. Too often they are used for things
which are, frankly, political slush or things which are of such
low priority that they are laughable. In some cases they go to
some of the wealthiest companies in the world. It makes no
sense.
I want to touch on briefly, for people who have been on another
planet, what has been going on in the Department of Human
Resources Development. Back in January the Reform Party brought
to light an audit which revealed all kinds of terrible
mismanagement. We found that there was absolutely no monitoring
of files on over $1 billion worth of grants and subsidies. We
found that there were many cases where applications were not even
submitted but grant money was given to people. We found all
kinds of unbelievable things.
The interesting thing is, instead of acknowledging right away
that this was a scandal and saying “We are going to bring an end
to these grants and subsidies”, because of, frankly, the
political corruption that follows, they said “We are going to
implement a six-point plan and we will do better”.
What has happened over the last little while is that the more we
have dug the worse it gets. It is spreading like a stain. Now
we find that the Indian affairs minister has all kinds of
intrigues going on in his riding and the police have been called
in to conduct investigations in the Prime Minister's riding.
There is all kinds of stuff going on. This happens at a time
when the finance minister brings down a budget.
What does the finance minister do? He continues to rubber stamp
the cheques. We find that there is even more money in this
budget going to the human resources minister. That is
unbelievable, after that record. There is no question that she
should be fired.
The $1 billion is only part of it. The government spends $13.5
billion a year on grants and contributions. We were talking
about health care a minute ago. The entire time that the
government was cutting the heart out of health care it maintained
spending for grants and contributions. It could not let down its
political friends or stop funding its pet projects. No way. It
would rather cut hospital beds across the country so that it
could fund hotel beds in Shawinigan. It is disgraceful, but that
is exactly what happened.
I want to say a word about the Liberals' assertions that this
billion dollar boondoggle created 30,000 jobs.
Of course when they are challenged on the numbers they cannot
actually produce any evidence that it produced even one job
because they did not really keep any records. It is only a
billion. After all, how could they be expected to keep records.
1340
If that is true, if they really did create 30,000 jobs, and we
know they have this big surplus, then why in the world would they
not clean up all of the unemployment in the country? There are
1.1 million Canadians unemployed today. Why not spend $70
billion or $100 billion? We would not have any unemployed in
Canada any more. Imagine the revenues that would pour in. It
would be unbelievable.
The reason they do not want to do that is because they do not
believe their own arguments. They know this did not really
create jobs. All it did was take money from one group of people,
the taxpayers, and give it to another group of people who
happened to be their friends, or in some cases wealthy
corporations. Why would they do that except to curry favour and
buy votes? The fact is, they do not even believe their own
arguments. Otherwise they would be arguing that the amount of
money should be increased dramatically.
I want to say a word about something that was left almost
unmentioned in the budget. It is important and it should be
addressed. A moment ago my friend, the parliamentary secretary,
blew off a question from a Bloc member about the debt. Is the
debt not an issue in Canada any more? We have $577 billion of
debt in this country and the government has absolutely no plan.
An hon. member: It has gone down.
Mr. Monte Solberg: Oh, my friend says that it has gone
down. It has gone down $6 billion. At that rate, in another 190
years it will be paid off. It is going really well. The fact
is, Canadians see the debt as an impediment. They see it as
something which holds the country back. When there is debt there
are interest payments. In Canada today we pay about $42 billion
a year in interest payments. This government has absolutely no
serious plan to address the issue of debt.
We argue that the government should take some of the boondoggle
spending from human resources development, put it into health
care and education, and put it toward reducing the debt. That is
what we want to see. Why does it not do that? I think Canadians
are onside with us when we say that.
I will talk for a moment about what the Reform Party would do.
It is only fair that we lay out our plan. We argue that the very
first thing we should do is reallocate the wasteful spending that
has become a symbol of the Liberal Party over the years. We
would take that money from its political friends and we would put
it into things which Canadians care about. I mentioned health
care and higher education a minute ago.
We also believe that we should take that $13.5 billion, which
over the next five years would be about $65 billion, which is a
lot of money, and put it into things people care about. We think
that we need to start to fund lower taxes in a way that really
does put money into people's pockets.
An hon. member: We should be funding ESSO.
Mr. Monte Solberg: My friends across the way sit and
heckle. I think I have touched a nerve. They know, as part of a
government that has presided over these large cuts to health care
while continuing to fund boondoggle spending, that it is really
the party that has cut more hospital beds and—
The Deputy Speaker: Order, please. I know the hon.
member for Medicine Hat has raised points which have created some
interest in the House and the debate is lively, but it is hard
for the Speaker to hear the words of the hon. member for Medicine
Hat, which the Speaker is interested in hearing, and I know that
hon. members will want to conduct themselves accordingly.
Mr. Monte Solberg: Mr. Speaker, you are a wise man. I
appreciate that wise intervention.
My friends across the way are very sensitive about their role in
reducing health care to its present state, and well they should
be, but I will not dwell on that.
We believe that we have room, because we have a surplus
approaching $150 billion over the next five years, to reduce
taxes tremendously.
An hon. member: Thank you.
Mr. Monte Solberg: My friend from Simcoe—Grey
says thank you, but it is really the taxpayers who should be
thanked. They are the ones who have borne the burden of the
deficit fight through higher taxes. There are incredibly high
taxes today in Canada, the highest personal income taxes in the
industrialized world. We need to lower them.
1345
Our plan would do three different things. It would increase the
basic exemption to $10,000, drawing from that big surplus. It
would extend a $3,000 deduction to all families with children. It
would take the 26% and 29% rates and move every rate down to a
single rate of 17%.
What would the impact of that be? It would mean that every
Canadian would see their taxes go down dramatically. We would
see that our country would be the most attractive country in the
world when it comes to investment. We would see money come back
into the country. We have seen $135 billion flow out over the
last 10 years under the Liberal government and under the Tories
before it. That money would start to come back into Canada
because this would be an attractive place to invest.
More than that, we would see some great social benefits. I want
to say a word about that. We would see a tax plan that would
lift two million low income Canadians right off the tax rolls.
It is tough enough being poor without having the government tax
people for the crime of having a low income, but that is what
happens every year.
We would also end the discrimination against single income
families, something the government failed to do in its budget. In
the tax code there is a discrimination against single income
families. It continues under this tax plan despite the efforts
of some members across the way. Unfortunately it does not sound
like the government wants to change it. Under our plan it would
change. We would get rid of that discrimination.
More important, we would attract a tremendous amount of economic
activity to Canada. I want to say a word about why that is
important.
In a situation where the economy is underperforming like it is
in Canada today where we still have almost 7% unemployment, who
are the people who are hurt the most? It is people without
skills. It is people without education. We need to help those
people.
We would do that by having an economy that moved a lot faster.
If it did, those people would be scooped up. They would get the
jobs. They would get the experience, the contacts, the capital
and the confidence which would allow them to improve their lot.
They could maintain their dignity. They could provide for their
own families instead of being kept dependent by the government.
It is shameful that it would allow people to be left in that
state, but the government does it.
Solution 17 will lift Canadians off the tax rolls. It will
lower taxes. It will attract investment. My friends across the
way should not let pride get in their way. They should make sure
they adopt this plan. Let them adopt this plan. Let us get
Canadians back to work. Let us create some opportunity for
Canadians from coast to coast.
Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker,
in my experience for every complex problem there is a simple
solution and it is wrong. The Reform flat tax proposal is such a
matter.
I would like the hon. member to tell Canadians that if this were
introduced and if people at the low end of the tax regime were
dropped off and the highest income earners who are presently
taxed at high rates came down to lower rates, then exactly who
would pay for the lost revenues from the low and high groups?
Would the hon. member not admit that it would be middle income
Canadians?
Mr. Monte Solberg: Mr. Speaker, I would be happy to tell
the hon. member who would pay. The Department of Human Resources
Development and the minister would pay, because we would not fund
that garbage any more. It would be gone and the benefits would
go to Canadians of all stripes.
I am glad my friend across the way asked me the question. I
would like to quote from a study done by Dale Orr of WEFA Inc. He
is the fellow who chaired the finance minister's private sector
economists and who prepared the documents for the fiscal and
economic update in the fall. In talking about our proposals he
said:
The tax reduction proposals...are well focused on the needs of
Canadians today. They expand the economy, and most powerfully:
personal disposable income, consumption and our standard of
living. They create jobs. By lowering the marginal tax rates
they are particularly effective in stimulating work effort, and
stemming the brain drain and other productivity enhancing
features. By powerfully reducing the level of personal income
tax, particularly for Canadians of average and above average
income, they are well directed at providing a more competitive
tax environment in Canada relative to the U.S.
They focus precisely and effectively on “bracket creep”,
raising the basic personal exemption, particularly affecting the
lowest income taxpayers, by much more than the rate of inflation:
By eliminating the current 26% and 29% marginal tax rates, any
bracket creep relating to these rates is eliminated. The issue
of fairness is addressed, not only by the elimination of bracket
creep, but by honouring the original policy intentions of the 5%
“deficit reduction” surtax and reducing EI premiums to be
consistent with EI policy....The tax reduction proposals of the
Reform Party are affordable. If all of the tax reduction
proposals are introduced as a combined package, over the 2000-01
to 2004-05 period, there would still be a fiscal surplus in each
and every year.
1350
That is what our plan would do.
Mr. Yvon Godin (Acadie—Bathurst, NDP): Mr. Speaker, I
would like to ask to my colleague from the Reform Party a
question. Every time I hear we should bring employment insurance
premiums down, but what about those 800,000 workers who have lost
their employment and do not qualify for employment insurance?
What about the 1.4 million children who are hungry? What is the
position of the Reform Party?
I have a motion in the House of Commons and it seems that the
Reform Party does not want to support it. The only thing my
motion says is to revise employment insurance. The only thing I
hear from my colleague is to bring the premiums down. I have not
heard any workers on the streets asking for the premiums to be
brought down. They have asked that the benefits be brought up.
I would like to hear his position on that.
Mr. Monte Solberg: Mr. Speaker, it is interesting how
different people think so differently.
I would rather see people have a job than an enhanced social
program. Families with children need permanent jobs, jobs that
pay a good salary. That is what we have to focus our efforts on.
Why does my friend automatically assume that the best use of
money is through the hands of a government, to hand it out to
different people?
Let us give that money back to the job creators in Canada. They
will provide the best social program in the world and that is a
good job.
Mr. Howard Hilstrom (Selkirk—Interlake, Ref.): Mr.
Speaker, we are talking about where money might be coming from to
help out with spending on high priorities in this country.
Last week Environment Canada and Agriculture and Agri-Food
Canada made a big announcement that they are going to put up
$600,000 to put a sign by a farmer's gate to acknowledge that the
farmer is helping out on environmental issues by the way he
farms. Does the member believe that that $600,000 should go
toward that fence post in front of that farmer's yard or should it
be going into health care which we really need and want?
Mr. Monte Solberg: Mr. Speaker, clearly my friend has
pointed to another example of the idiocy that occurs on a daily
basis in the ranks of government. We see good money thrown after
bad.
My friends across the way are sensitive and they should be. At
the same time as that is happening, hospital beds have closed,
people have left the country because the taxes are too high, and
people cannot afford tuitions because they have been raised and
transfers to the provinces have been lowered for those sorts of
things. It is time to change that. Let us change that by
getting rid of the grants and contributions that go to
boondoggles. Let us take that money and put it to good use
instead.
Mr. Paul Bonwick (Simcoe—Grey, Lib.): Mr. Speaker,
first the hon. member suggested not to let pride get in the way.
Pride cannot help but get in the way for me because I am very
proud to be Canadian and very proud to be a member of the
government that has brought unemployment rates down consistently
for the last six years. I am proud of the fact that we have been
able to manage the finances of this nation and actually deal with
a surplus.
The hon. member seems to want to go to a flat tax system and gut
health care and social programs. The member talked about
redirecting funding from HRDC and focusing it on tax reduction.
Would he be prepared to come to my riding and talk to the
Georgian Bay Literacy Foundation that got $29,000? It helps
people who are illiterate to get jobs. Would he be prepared to
go and meet Tracks Youth Unemployment? The people who are
underemployed and unemployed in my riding who need the necessary
skills so they can go into the job market and secure full
permanent employment, would he tell them that the Reform Party
does not care about them because it wants to gut the social
programs in this country?
1355
Mr. Monte Solberg: Mr. Speaker, I am afraid my friend has
beat me to the punch. They have already gutted health care
across the way. Congratulations.
I will say to my friend that when he initially stood up and said
he would not let pride get in the way, I thought it was going to
be because he had no pride. Apparently he does not after the
yarn we just heard.
My friend across the way should be aware that the Reform Party
takes a very different approach. We say that Canadians
themselves are very generous. We know that they would come to
the fore any time they are asked to help out people in need. They
have proven that year after year after year.
Leave the money in their pockets and they will look after their
friends and their neighbours because they do it every day. We
are a generous people. We do not need my friend across the way
lecturing people on how they need to be a little bit more
generous.
My friend across the way has proven through his actions and
through his government's actions that they are the main culprits
when it comes to hurting Canadians. They have done it for the
last six years.
* * *
POINTS OF ORDER
CAMERA USE IN CHAMBER
Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker, I
rise on a point of order.
Yesterday during the budget speech I used a digital camera to
take pictures in the Chamber. I was advised by the Chair that
although this is not written in our rules, it is not the practice
of the House to permit that.
Therefore I would like to apologize to any members who were
concerned about that and indeed to the entire House.
I would also like to confirm that all of the pictures have been
erased and no pictures were printed.
The Speaker: As it is now approximately 2 o'clock, we
will proceed to statements by members.
STATEMENTS BY MEMBERS
[English]
THE BUDGET
Mr. Gary Lunn (Saanich—Gulf Islands, Ref.): Mr. Speaker,
I rise today to comment on the government's budget.
While I commend the government for following the Reform Party's
advice and eliminating bracket creep, I believe this budget could
have gone much further when it comes to tax cuts for average
Canadians.
I wonder why the government continues to pile money into
programs rather than health care and education where it is
needed. Added transfer payments to the provinces of $2.5 billion
over the next four years does not come close to meeting the needs
of our hospitals and schools.
The public is crying out for an end to the waiting lists for
hospital beds but the government would rather pour money into
HRDC and Canadian heritage programs which often go to Liberal
friends and insiders.
For every dollar the government is giving back in tax cuts, it
is still spending $2 on programs. Has the government learned
nothing from its billion dollar mishandling of taxpayers' money?
Canadians deserve better.
The Speaker: I would ask members to please contain
themselves, especially during the statements by members. We all
want to hear what they have to say. I would expect that we would
all listen to what members have to say. If members do not want
to listen to what others have to say, I invite you please to wait
in the lobby.
* * *
INTERNATIONAL WOMEN'S WEEK
Ms. Carolyn Bennett (St. Paul's, Lib.): Mr. Speaker, I am
honoured to rise today in the House to mark International Women's
Week, March 6 to 12.
The federal theme this year is “Canadian Women Taking Action To
Make a Difference”. This theme was chosen to highlight the
initiatives and accomplishments of women's organizations across
the country in the struggle against violence and poverty, the
major themes of the upcoming World March of Women in the year
2000.
Women's organizations have played a key role in influencing
government policy to advance gender equality in all aspects of
Canadian life. The work to make a difference in the areas of
violence against women and poverty has impacted on the lives of
many women and young girls in creating an awareness of these
crucial issues among decision makers and all Canadians.
As we celebrate International Women's Day, let us remember that
while we have made progress, women account for 88% of the victims
of sexual assault. Single mothers with children under 18 have a
poverty rate of 57%.
We salute the efforts of all women across Canada to end violence
against women and poverty in society. Each of us has had a role
to play in reaching these goals and we will all benefit from
these efforts.
* * *
1400
NIAGARA REGIONAL POLICE SERVICE
Mr. Walt Lastewka (St. Catharines, Lib.): Mr. Speaker, I
would like to congratulate the Niagara Regional Police Service
for its recent receipt of accreditation from the Commission on
Accreditation for Law Enforcement Agencies.
The commission is an independent, non-profit organization
founded by law enforcement membership associations. The
commission maintains a body of professional law enforcement
standards and administers a voluntary process for participation.
The Niagara Regional Police Service entered this voluntary
program to demonstrate its professionalism and pride in
delivering quality law enforcement service to Niagara.
The awarding of this accredited status makes the Niagara force
and its officers part of an elite group of law enforcement
agencies in the United States, Canada and Barbados that have
received this prestigious international recognition.
Congratulations to Chief Grant Waddell and to all the members of
the Niagara Regional Police Service.
* * *
[Translation]
GASOLINE PRICES
Mr. Guy St-Julien (Abitibi—Baie-James—Nunavik, Lib.): Mr. Speaker,
the government should make sure that the service stations of all
the major and independent oil companies and all businesses in
Canada display the base price per litre of gasoline or diesel at
the pump, free of the federal and provincial taxes, in the same
way as consumers see the base price of food and household
products they purchase.
* * *
THE BUDGET
Mrs. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.): Mr.
Speaker, in the budget speech, the government announced a major
innovation that will have a significant impact on the lives of
Canadians.
We are reintroducing full indexation of personal income tax in
order to protect all taxpayers from automatic tax increases
through inflation.
The plan provides immediate tax savings, that is as of 2001.
These measures will benefit Canadian families directly. For
example, a one-income family of four earning some $32,000 will
pay no net federal tax.
Also, a one-income family of four earning $40,000 will have its
federal income tax cut by 17%.
This is how our government is working to improve the quality of
the lives of Canadian families.
* * *
[English]
AGRICULTURE
Mr. Rick Casson (Lethbridge, Ref.): Mr. Speaker, for the
last number of years farmers have been caught in the deathly grip
of an income crisis forced on to them by years of federal
agriculture mismanagement and compounded by high foreign
subsidies and bad weather.
This crisis has shaken the agriculture industry to its very
roots. Increasingly, distressed farmers are turning to desperate
measures, including hunger strikes, to try and make this
government aware of their problems.
When simply ignoring the problem did not work, the Liberals
grudgingly announced AIDA, an emergency program that has only
delivered a paltry 23% of the promised $1.7 billion. When they
realized that AIDA was a failure they tried to apply another $200
million band-aid with no guarantee that any of these funds will
ever be delivered. If that was not insult enough, farmers were
completely shut out of yesterday's budget.
Farmers need more than band-aids. They need real reform that
addresses the root problem of the farm income crisis, and they
will not get that reform from this government.
* * *
[Translation]
THE BUDGET
Mr. Bernard Patry (Pierrefonds—Dollard, Lib.): Mr. Speaker, in
the budget speech, the Canadian government announced its
intention to invest $2.5 billion, over a four year period,
through the Canada health and social transfer.
I wish to point out that this is the fourth consecutive increase
under that program. Our government is receptive to the requests
and needs of Canadians.
The government also announced that the Canada child tax benefit
will get an additional $2.5 billion by the year 2004.
Finally, under budget 2000, the amount of maternity and parental
benefits paid under the employment insurance program will
double, since these benefits will paid for 12 months, instead of
six. The criteria will also be more flexible and more people
will have access to these benefits.
These are concrete initiatives that will allow us to help
Canadian families and improve their quality of life.
* * *
MICHEL DUMOND
Mr. Benoît Sauvageau (Repentigny, BQ): Mr. Speaker, I would like
to read a letter from one of my constituents.
This letter is a cry from the heart by a man who is paying for a
crime he never committed. After years of making representations,
Michel Dumond is still waiting for that injustice to be
corrected.
His letter reads as follows:
As you know, since 1990, I have been claiming that I was
innocent and you have in your possession a large file that
proves my innocence. The purpose of this letter is to inform you
of all the problems caused by the offence of which I am wrongly
accused, including loss of employment, impossibility to obtain a
passport and travel abroad, etc.
You have the authority to undo the harm done to me by the
justice system by invoking section 690 of the Criminal Code. I
am anxiously waiting for your decision.
Thank you for your kind attention.
1405
I hope the minister will follow up on Mr. Dumond's request at
the earliest opportunity, so that he can resume a normal life,
the one he led before these terrible events.
* * *
[English]
ST. PATRICK'S DAY
Mr. John Nunziata (York South—Weston, Ind.): Mr.
Speaker, as we approach St. Patrick's Day it provides an
opportunity to recognize the immense contribution of the Irish
community in Canada.
Ted McConnell, an Irish immigrant, is being honoured this year
for his significant contribution to Irish-Canadian relations and
his lifelong commitment to peace in Northern Ireland.
Ted was selected as this year's grand marshal for the St.
Patrick's Day parade and will be honoured at the Grand Marshal's
Ball on March 11 in Toronto.
Ted was born in Belfast in 1931 and immigrated to Canada in
1957. Throughout his successful career, Ted has devoted himself
to enhancing Canada's relationship with his homeland.
In recognition of his efforts, Ted was selected the first
honorary consul general of Ireland to Canada in 1997. He is
currently Canada's representative on the International Fund for
Ireland. He is also on the board of the Ireland Fund of Canada,
the Canada-Ireland Chamber of Commerce and the School of Celtic
Studies at St. Michael's College.
Ted was honoured in 1991 with the prestigious Order of the
British Empire.
On behalf of parliament, I would like to pay tribute to this
outstanding individual and to say thank you for bringing Canada
and Ireland closer together.
* * *
THE BUDGET
Mr. Ian Murray (Lanark—Carleton, Lib.): Mr. Speaker,
yesterday's budget gave the high tech community something to
celebrate. It fulfilled almost every priority on the industry's
wish list and showed support for innovation and technology across
the country and in particular those in silicon valley north in my
riding of Lanark—Carleton.
The Minister of Finance provided $1 billion worth of tax breaks
directed largely at the high tech industry, lowering the tax rate
paid by higher taxed industries, mostly in the high tech services
sector, from 28% to 21%.
The budget included a deferral on taxing stock options,
reductions in capital gains and corporate taxes and the creation
of tax free rollovers. This will allow individuals to defer
capital gains taxes on as much as $500,000 when they withdraw
capital from one small business and reinvest in another.
I am confident these measures will encourage innovation and
investment and help put all sectors of our economy on an
internationally competitive footing.
* * *
APEC INQUIRY
Mr. Jim Abbott (Kootenay—Columbia, Ref.): Mr. Speaker,
the Prime Minister has almost achieved his objective of burying
his involvement in the suppression of Canadian freedom of
expression at APEC. The Prime Minister has said that he does not
have to go and testify at the commission because he can reply to
questions in the House.
There are two important differences between the House and the
APEC Inquiry. First, the inquiry witnesses are under oath.
Second, witnesses may be cross-examined with direct challenges to
their testimony.
Obviously the commissioner feels that testifying under oath,
providing detailed answers and being cross-examined are what the
Prime Minister needs to do in order to avoid a cloud of public
suspicion over the APEC inquiry.
Understandably, complainants are withdrawing from the process in
Vancouver today. The use of the Public Complaints Commission has
been a smokescreen for the Prime Minister and his office all the
way along. The Prime Minister will not testify with the excuse
that he will set a precedent for future prime ministers. Well
the Prime Minister has already set the precedent, one of
arrogance.
* * *
PUBLIC TRANSIT
Mr. Mac Harb (Ottawa Centre, Lib.): Mr. Speaker, several
weeks ago I had the pleasure of meeting with Randy Graham and
public transit representatives who reaffirmed the importance of
public transit in Canada. It was good to hear in yesterday's
budget that this government is renewing one of its most
successful initiatives, infrastructure programs.
This is great news for municipal infrastructure. In places like
Ottawa, this means that public transit may be able to improve and
expand the existing transit system. Better public transit means
a reduction in harmful emissions, which is positive news for the
environment.
Also good for the environment is the commitment made to green
infrastructure. The green municipal enabling fund will help
communities assess where their environmental needs are greatest.
This budget is great news for public transit, the environment
and all Canadians.
* * *
THE BUDGET
Ms. Wendy Lill (Dartmouth, NDP): Mr. Speaker, yesterday's
budget abandoned the promise of investing in our children.
The minuscule social spending announced does almost nothing to
reduce child poverty, to give our kids an adequate education or
to protect our children's health. It says that it is okay that
one in five children live in poverty. It does not help families
find affordable child care. It does not help students with
crushing debt loads. It shrugs off the despair driving
aboriginal children to suicide.
Last evening, while the finance minister was out selling tax
cuts, CBC Radio's Ideas talked about our social obsession with
youth and the fact that we pay no real attention to the harsh
reality of our children.
The budget is a clear example of this. There is nothing about
overcrowded classrooms, too few teachers or out of date books.
The budget is silent on kids without food, without housing and
self-respect. Tax cuts come before poor kids, highways before
public caring.
1410
The budget says that this is an acceptable condition for our
children and that this government knows the price of everything
but the value of nothing.
* * *
[Translation]
THE BUDGET
Mrs. Monique Guay (Laurentides, BQ): Mr. Speaker, in many
respects, the government's last budget was a big disappointment.
Despite the desperate needs of hospitals, the crowding in
emergency rooms, and the unanimity of the provinces, community
groups and the public, the federal budget has announced a
one-time increase of only $2.5 billion over four years, a one-shot
payment that will resolve nothing and that represents only 14%
of the real funding called for by the provinces.
The federal government has also dashed the hopes of 58% of
unemployed workers, who do not quality for benefits, and of
women and young people who are heavily penalized by a system
that is too restrictive and that does not reflect reality.
With this budget, Quebecers and Canadians can see that surpluses
will remain high and will sit in federal government coffers for
the coming years.
The federal government's millennium budget is a missed
opportunity to show compassion and caring. This is a fine way
to mark the yeqr 2000.
* * *
[English]
THE BUDGET
Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker,
yesterday the finance minister delivered his seventh budget to
the people of Canada, which I believe will translate into a
better quality of life for all.
He delivered investments in health care, in knowledge and
innovation, in families with children and in the environment. He
also announced a five year tax reduction plan and a continued
commitment to sound financial management.
Since 1993 the finance minister has asked parliament to consult
with Canadians in preparation for each budget and he has acted on
their views and priorities year after year after year.
Last night the finance minister stated that budget 2000 puts us
in a strong competitive position internationally such that, in
his own words, “no one will be able to touch us”.
I wish to congratulate the finance minister for his leadership
role in getting our financial house in order and for delivering
to Canadians the tax cuts of strategic investments which will
make Canada the place to be in the 21st century.
* * *
THE LATE CLARENCE EUGENE HANK SNOW
Mr. Gerald Keddy (South Shore, PC): Mr. Speaker, on
December 20, 1999, after a long illness, Clarence Eugene Hank
Snow died at the age of 85. Hank was one of the few remaining
country music legends whose life's work helped define what
country music means to millions of its fans.
Born in Brooklyn, Queens County, Nova Scotia, Hank, as a
teenager, occasionally slept in Liverpool's historic CN Railway
building, now the home of the most unique country music
attraction northeast of Nashville.
In August 1997, I was fortunate to attend the grand opening of
the Hank Snow Country Music Centre in Liverpool, which was
established to celebrate the life and accomplishments of Hank.
Each year a Hank Snow tribute is organized by the Friends of Hank
Snow Society which features performers and a popular Sounds Like
Hank contest.
The Hank Snow Country Music Centre and annual Hank Snow tribute
will continue to celebrate one of country music's greatest
legends even though Hank Snow is now “Movin' on”.
* * *
[Translation]
FOREIGN POLICY
Mr. Robert Bertrand (Pontiac—Gatineau—Labelle, Lib.): Mr. Speaker,
for Canada, the concepts of peace and security have a special
meaning. They also translate into very specific action plans.
The government's focus is on protecting citizens and the rights
of children in armed conflicts; stemming the flow of
conventional and light weapons; implementing the Ottawa
convention, the official title of which is the convention on the
prohibition of the use, stockpiling, production and transfer of
anti-personnel mines and their destruction; and fighting
organized crime, drug trafficking and terrorism.
Canada is not alone in trying to better protect the public. A
number of countries are working together toward the same goals,
in order to improve the quality of life of citizens everywhere.
* * *
[English]
NATIONAL PARKS
Mr. Rick Laliberte (Churchill River, NDP): Mr. Speaker,
each year Canadians and international travellers visit our
national parks bringing economic benefits and employment to rural
communities across this great country.
The wilderness experience is shared by many generations and is
the highlight in many a child's vacation.
When the Governor General stated in her throne speech that the
government would continue to extend Canada's national parks
system, Canadians were delighted by her commitment to our natural
treasures.
Canadians knew that the Prime Minister's promise to complete the
parks system by the year 2000 would not come true, but we hoped
that the government would demonstrate at least some vision and
direction toward this honourable goal.
1415
There was no mention of Canada's park system in yesterday's
budget, not one commitment to reverse the loss of ecological
integrity, not one promise to restore interpretive and essential
services, not one single word to extend our legacy of national
parks.
ORAL QUESTION PERIOD
[English]
THE BUDGET
Mr. Preston Manning (Leader of the Opposition, Ref.): Mr.
Speaker, to no one's surprise increased spending was the number
one priority in yesterday's budget with $86 billion in new
spending over five years. Government members were so excited
they gave the queen of the boondoggle a standing ovation and more
money.
Some hon. members: Oh, oh.
The Speaker: Order, please. I ask hon. members to please
address each other by their titles.
Mr. Preston Manning: Mr. Speaker, the Prime Minister
should have been outraged by the billion dollar boondoggle at
human resources. Instead, he rewards the minister by giving her
an additional $220 million of discretionary spending.
Why would the Prime Minister give a massive increase in
discretionary spending to a minister who mismanages taxpayers'
dollars?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, when I hear the hon. member objecting to the increased
spending, the $80 billion to which he refers, I have a lot of
difficulty. This is spending for health care, for education and
for research and development.
However I have really discovered the answer. He is not
objecting to us spending money on health care, education, and
research and development. He is objecting to Stockwell Day
spending money on health care, education, and R and D. The
leader of the Reform Party—
The Speaker: The hon. Leader of the Opposition.
Mr. Preston Manning (Leader of the Opposition, Ref.): Mr.
Speaker, for more than 21 years the auditor general has been
warning and warning the government about misspending under grants
and contributions. The Prime Minister is aware of these warnings
but he chooses to ignore them.
This year an internal HRDC audit reveals more waste in the
management just where? In exactly the same place. The Prime
Minister's response to these warnings is to give the minister
another $221 million.
Is the Prime Minister's contempt for the taxpayers so high that
he did this out of spite, or did he do it so there would be more
money around for the next federal election?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, the government over the last six and a half years has
managed to take a deficit from $42 billion to being in a position
to present a fantastic budget.
Of course we are spending more money for the poor, the
underprivileged, research and development, education and health.
At the same time we gave the Canadian people the greatest tax cut
they have not had in the last 50—
The Speaker: The hon. Leader of the Opposition.
Mr. Preston Manning (Leader of the Opposition, Ref.): Mr.
Speaker, for once the Prime Minister got it exactly right, the
tax cut the Canadian people have not had.
Under any normal circumstances a billion dollar spending
boondoggle would send shock waves through an institution. All
departments would be called to account. The brakes would be put
on future spending. Management would be changed but not in this
government. Sixteen out of nineteen departments got spending
increases and not one manager has been changed.
Why should Canadian taxpayers give the government one more
dollar when that department mismanages—
The Speaker: The Right Hon. Prime Minister.
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, if the hon. member had done his homework he would know
that this money is going for a program that was announced in the
House in December, giving more money for the people who are
homeless in Canada. It was requested by the provincial
governments and the mayors, and we have done it. He would know
that this money has been given in order to give more money to the
students in Canada.
We could go on and on. We always have causes that need help in
Canada.
I know the Reform Party, which might be another party with a very
funny name in a few weeks, does not want to give money to the
people at the bottom—
1420
The Speaker: The hon. member for Medicine Hat.
Mr. Monte Solberg (Medicine Hat, Ref.): Mr. Speaker, HRDC
helping the homeless. I wonder if that means perhaps it will be
allowed to use the fountain in Shawinigan to clean up a bit. Is
that the idea?
Yesterday the government wrote a new cheque for $226 million to
the HRDC minister. I guess a billion dollars mismanaged to spend
on fountains and subsidies for Wal-Marts is not enough.
Why would the Prime Minister give even one cent to the human
resources minister when she has proven to be so completely
incompetent with the billion dollars she already gets?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, understand what that money is for. It is for the
student loan program. Understand what that money is for. It is
for grants to single parents who want to go back to school. That
is what that money is for.
The fact of the matter is that the member for Medicine Hat and
the leader of the Reform Party are the only two people in Canada
to the right of Stockwell Day. One more step and they are going
to fall off the side of the earth.
Mr. Monte Solberg (Medicine Hat, Ref.): Mr. Speaker,
words of wisdom from the president of the flat earth society and
Canada's top tax refugee.
The minister of human resources has stumbled and bumbled her way
through her department. She has knocked things over. She has
set them on fire, burning up a billion dollars along the way. Why
would the Prime Minister give one cent to this person who has
become the Mr. Bean of Canadian politics?
The Speaker: Order, please. I would ask members on both
sides to address each other by their proper titles.
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, it is pretty clear that the Reform Party's questions are
based on a fundamental misunderstanding of the budget.
Let me quote from the Reform Party website this morning: “The
federal tax budget will continue to increase over the next five
years due to bracket creep”. I just want to explain something.
Yesterday when I said that indexation was back it meant that
bracket creep was gone.
* * *
[Translation]
HUMAN RESOURCES DEVELOPMENT
Mr. Gilles Duceppe (Laurier—Sainte-Marie, BQ): Mr. Speaker, the
Minister of Human Resources Development thought perhaps she
would not be facing any more questions with yesterday's budget,
but we have a few more questions for her.
In the matter of the transfer of the project from Rosemont to
the riding of Saint-Maurice—
Some hon. members: Oh, oh.
[English]
The Speaker: Order, please. One of our fundamental
rights surely is to be heard in the House. I think it is just a
common courtesy.
1425
[Translation]
Mr. Gilles Duceppe: Mr. Speaker, I have a question for the
Minister of Human Resources Development regarding the Rosemont
project that was transferred to the riding of Saint-Maurice.
She spoke of lack of space, but that did not stand up. Mr.
Goldberger, the company president, confirmed this. He has been
the subject of legal proceedings on this matter since April 1999.
How can the minister ignore these facts and argue the lack of
space contention, when she has been in the job since August 1999
and keeps saying that she is responsible for everything that goes
on in her department?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, this is really quite incredible. Probably
the most important document in the parliamentary calendar was
tabled in the House yesterday and this party is still asking
about questions that were raised weeks ago.
I have said on this particular file that we have asked an
outside auditor to come in and make sense of the facts, but we
know that Canadians, including those living in Quebec, are
interested in what is in this budget. They will be very
surprised why this hon. member is not asking about our investment
in parental benefits, about our investments in Canadians and
their children.
[Translation]
Mr. Gilles Duceppe (Laurier—Sainte-Marie, BQ): Mr. Speaker,
we are asking questions because the budget tabled yesterday is in
the hands of ministers like her, whom we do not trust exactly.
This is why we ask her questions. We want to know what she has
done with the people's money, because money has disappeared.
Hon. Denis Coderre: Louder, louder.
Mr. Gilles Duceppe: Mr. Speaker, could the member for Bourassa
stop his Elvis Gratton routine while we ask a question?
Some hon. members: Oh, oh.
The Speaker: Order, please. I would ask the leader of
the Bloc Quebecois to put his question.
Mr. Gilles Duceppe: I would ask the minister, rather than hide
from questions and not respond, either because an investigation
is under way or because she does not know the answers or because
it was under her predecessor—now she wants to hide behind the
budget—whether she can tell us why she did not know the facts,
what went on, about the money transferred from Rosemont to
Saint-Maurice?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, we are not running away from the
questions. Indeed I have asked an outside auditing firm to come
in and look at this particular file.
Quite the contrary, what we have done is open the process of
grants and contributions to the House so members of parliament
can be aware of the investments that are going into their
communities, so that they can help and understand how we can
continue to make differences in the lives of Canadians.
We are quite prepared to be open in this regard. I have told
the hon. member that we will convey to him the information as is
appropriate.
[Translation]
Mr. Bernard Bigras (Rosemont, BQ): Mr. Speaker, yesterday the
Prime Minister reminded us that the Rosemont project that was
transferred over to his riding was signed off by the MP for
Rosemont and not by him.
How can the Prime Minister justify the fact that a project
approved by the MP for Rosemont ended up in his riding and is
being carried out on the premises of Maurice Perreault, whom he
knows very well, since his name appears in his March 1997
householder?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, let us go at this again. We have
clarified that we have asked an outside accounting firm to come
in and audit this particular project. At that point we will be
able to answer the questions of the hon. member.
[Translation]
Mr. Bernard Bigras (Rosemont, BQ): Mr. Speaker, yesterday the
Prime Minister, that unwitting linguist, told us that those
three little dots in French were known as an ellipsis. The
House was suitably enlightened.
What we want to know is: what exactly was that ellipsis? Was
that the time it took for the project to move from Rosemont to
the minister's desk and then on to the riding of Saint-Maurice?
Is that what he was referring to yesterday?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr. Speaker, I
am pleased to repeat that at no time was my office, or anyone in
my office, informed of the possibility of a transfer. The
individual in question was never seen in my office or speaking
to the press or doing anything else to create jobs in the riding
of Saint-Maurice.
The application was in the riding of Rosemount, and there was no
transfer to the riding of Saint-Maurice, to the knowledge of
anyone in my office or in the region.
* * *
1430
[English]
HEALTH CARE
Ms. Alexa McDonough (Halifax, NDP): Mr. Speaker, my
question is for the finance minister.
Canadians' number one priority is to fix health care. They had
hoped that the budget would reflect that. They are struggling
with crowded emergency rooms. They are struggling with growing
waiting lists. They are struggling with increasing drug costs.
Will the finance minister at least acknowledge the depth of the
health care crisis?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, yesterday the Minister of Finance after we invested a
lot of money in health care last year added $2.5 billion to the
transfer to the provinces.
This is the only program of all the programs of the government
where not only have we re-established the level of transfer from
1993-94, but next year it will go from $37.4 billion in 1993-94
to $40.6 billion. It is an increase of $3 billion in transfer of
cash and points and of—
Ms. Alexa McDonough (Halifax, NDP): Mr. Speaker, talk
about an exercise in deception. Health transfers in this
budget—
Some hon. members: Oh, oh.
The Speaker: I would ask the hon. leader of the New
Democratic Party to withdraw those words.
Ms. Alexa McDonough: Well, Mr. Speaker, I would like to—
Some hon. members: Oh, oh.
Ms. Alexa McDonough: Health transfers in this budget are
enough to run health care in Nova Scotia or Saskatchewan for
about three days.
Clearly the government has abandoned any leadership in fixing
health care. For every one dollar in tax cuts, there are two
cents in cash transfers to health care.
When Canadians so clearly regard health care as their number one
priority, why has this—
The Speaker: The Right Hon. Prime Minister.
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, I have explained. I will explain again that the
transfers to the provinces from 1993-94 have increased by more
than $3 billion this year. Of all the programs of the
government, we are still spending $4 billion less than was spent
in 1993-94. In spite of that, in the transfer to the provinces of
cash and tax points and equalization payments, they are receiving
today $3 billion more than when we started.
* * *
HUMAN RESOURCES DEVELOPMENT
Mr. Peter MacKay (Pictou—Antigonish—Guysborough, PC):
Mr. Speaker, yesterday when the Prime Minister was questioned
about an investigation by the RCMP on CITEC, a company in his
riding, he replied, “As soon as my office was informed, the RCMP
were informed within minutes”. However, the former Liberal
minister of tourism in Quebec, André Vallerand, has stated that
he waited over a month for the PMO and HRDC to reply.
There is a contradiction. Who is correct, Mr. Vallerand or the
Prime Minister?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, as soon as my office was informed, the same day when
they realized that there was an accusation of that nature, they
called the RCMP. From there it was the responsibility of the
RCMP. If they did not call Mr. Vallerand it has nothing to do
with my office. My office acted absolutely properly in acting
the same day in transferring the problem.
Mr. Peter MacKay (Pictou—Antigonish—Guysborough, PC):
Mr. Speaker, let me try this again. What was the exact date that
the Prime Minister was made aware of the investigation from Mr.
Vallerand? What did they do with that information and when did
they contact the RCMP? In other words, what did the Prime
Minister know and when did he forget?
1435
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, it was February 2 when we were informed and it was
February 2 that the RCMP was informed.
Miss Deborah Grey (Edmonton North, Ref.): Mr. Speaker,
here is another name. Remember René Fugère, the fellow who
profited from the famous hotel grant? Well, it looks like old
René has been up to his tricks again.
In February 1998 the Opitciwan sawmill applied for a TJF grant
and was told by HRD that there was absolutely no money left in
the kitty. That seems kind of strange because along comes
Fugère—
Some hon. members: Oh, oh.
The Speaker: The hon. member for Edmonton North.
Miss Deborah Grey: Mr. Speaker, in February 1998 the
Opticiwan sawmill applied for a TJF grant and was told by HRD
that there was absolutely no money left in the kitty. All of a
sudden, along comes Mr. Fugère, the Prime Minister's buddy. The
minister's office gets involved and just like magic $300,000
appears.
Why is it that public money follows Mr. Fugère like an orphaned
duck?
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, earlier in his questioning the member's
leader said it is 21 years since the auditor general talked about
grants and contributions and the need for us to improve our
administration.
I am glad to say to the hon. member we are doing just that. In
the context of grants and contributions in my department we are
going to work to build the best system of modern comptrollership
that is second to none in North America. This is an important
undertaking and we are going to fix our problem and be the better
for it.
Miss Deborah Grey (Edmonton North, Ref.): Mr. Speaker,
it wears thin. I am sure hon. ministers have been saying that
for 21 years now and we know who was in power then.
There is a cast of thousands involved here. Even the current
HRD minister had her hand in this pie when she was at Indian
affairs. She wrote a letter approving $200,000 in funding to that
sawmill right around the same time.
It was René Fugère who had the magic touch. HRD officials said
they had no money for any project, until they realized that Mr.
Fugère was involved.
Why is there one set of rules for the Prime Minister's friends
and another for every other Canadian?
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, this is absolute nonsense and I reject
the premise of the hon. member's question.
It is clear here yet again that on this side of the House we
know that there is a role for the Government of Canada to play in
supporting Canadians who do not have the same opportunities as
others. What is clear is that this party—
Some hon. members: Oh, oh.
The Speaker: Order, please. The hon. Minister of Human Resources
Development.
Hon. Jane Stewart: What is clear from the questioning
from that side of the House is that they do not accept that there
is a role for the Government of Canada to play. They talk about
waste. I point out again and again and again, it cannot be a
waste to support students with Canada student loans. It cannot
be a waste to support parents who want to save for their
children's education. It cannot be a waste to support Canadians
with disabilities so that they can have an opportunity—
The Speaker: The hon. member for
Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques.
[Translation]
Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques,
BQ): Mr. Speaker, Placeteco, a company located in the riding of
Saint-Maurice, received a $1.2 million grant. When that company
went bankrupt, Human Resources and Development Canada put the
money into a trust then gave it to the new owner, something
which goes against the rules set by Treasury Board.
How can the minister explain that her own department is
violating her government's administrative directives?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, I responded to this question in the House
earlier, before Christmas. I accepted that there were
administrative problems with the decisions that the hon. member
is actually making. That is why to me it is so important to
undertake the six point plan, to implement it, to improve the
administration of grants and contributions in my department
because it is the foundation for these important contributions
that the Government of Canada makes in the lives of Canadians.
[Translation]
Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques,
BQ): Mr. Speaker, it is pretty obvious that the minister does
not want any investigation. Yet, it is a great concern to see
that the trustee appointed by HRDC was also the lawyer for
Claude Gauthier, the person who bought the company.
Is this a pure coincidence? Absolutely not. Between 1993 and
1997, Claude Gauthier also contributed $48,673 to the Liberal
Party coffers.
1440
Does the minister not think that she should immediately order an
investigation, since this might also allow her not to have to
reply to other embarrassing questions in the House?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, again this is an old story that we have
reviewed in the House before. Fundamental in everything here is
that these questions are old news. The issue that has been
raised was raised by us. The identification that we could do a
better job in administration was raised by us. We are going to
work to improve the system of administration and in so doing
ensure that the contributions that the Government of Canada makes
in the riding of the hon. member and every other member of the
House will be secure, will be strong and will be there in the
future.
Mrs. Diane Ablonczy (Calgary—Nose Hill, Ref.): Mr.
Speaker, here are a few interesting facts. In March HRDC said it
could not fund the sawmill application because it had zero money
left. In July HRDC said, “Look, quit asking. We already told
you, all the money has been spent”. In August the Prime
Minister's personal representative let HRDC know that it would
have to deal with him on the sawmill file. Shortly thereafter
HRDC mysteriously came up with over $250,000 for the sawmill.
What is there about the Prime Minister's buddy that forces
public servants to scramble to do his bidding?
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, as a result of our undertakings in
reviewing our grants and contributions, we are looking at all our
files. The active files will be clarified and any necessary
action taken.
Some hon. members: Oh, oh.
The Speaker: Order, please.
Hon. Jane Stewart: Again I want to remind the House that
when we are talking about transitional jobs fund grants and
Canada jobs fund grants, not only are members of parliament
involved, but the decisions include the consensus of or the
acceptance by the governments in that jurisdiction, including the
province of Quebec in this case and other governments like the
kissing cousins of the Reform Party on decisions made in Ontario.
Mrs. Diane Ablonczy (Calgary—Nose Hill, Ref.): Mr.
Speaker, I am just asking about one decision. Perhaps the
minister could give a straight answer.
HRDC rejected the sawmill application not once but twice. Then
Fugère showed up and money magically was shaken loose in the
department.
What connections does this man have that he is able to pressure
civil servants in her department into changing their decisions?
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, I am not going to accept the allegations
made by the hon. member here today. What I will confirm, as I
have confirmed over and over again, is that we are reviewing the
files associated with the grants and contributions in my
department. We will continue to make that information available
and public.
Some hon. members: Oh, oh.
The Speaker: Order, please. The hon. minister of Human
Resources Development.
Hon. Jane Stewart: Mr. Speaker, fundamentally what is
clear here is that the opposition is caught up in its own
rhetoric and cannot get moving forward.
What we know to be true is that Canadians understand this issue.
They know that we are fixing the problem. They are probably
sitting at home right now wondering why the parties on the other
side are not asking about the important priorities that are
facing them today.
[Translation]
Mrs. Christiane Gagnon (Québec, BQ): Mr. Speaker, the minister
continues to refuse to put Placeteco under investigation. Yet,
Placeteco refuses to be accountable to her department, because
that company no longer feels bound by the grant it received
through a trust which, incidentally, was not legal.
Will the minister finally agree that the time has come to launch
an investigation at the earliest opportunity?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, clearly we are prepared to answer the
questions. That is why last week we tabled the largest volume of
information the House has ever seen in its history.
The hon. member asked about an independent review. I say again
that an independent officer of the House, the auditor general,
will be doing a full review of the transitional jobs fund and the
grants and contributions in my department. That is good enough
for me.
1445
[Translation]
Mrs. Christiane Gagnon (Québec, BQ): Mr. Speaker, in a leaflet
sent to all the residents of Saint-Maurice, in March 1997, the
Prime Minister announced the creation of 174 jobs by Placeteco,
when the file had not yet been finalized. By the way, no jobs
were created. In fact, some jobs were even lost.
Can the minister tell us why there is still no investigation,
since we do not know who got the money and what use was made of
it?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, again, the money was invested to create
opportunities in an area of very high unemployment.
As we have said, and as I have talked about before, in this
particular project administrative errors were made. They have
been clarified.
Mr. Chuck Strahl (Fraser Valley, Ref.): Mr. Speaker, you
will remember René Fugère. He was the fellow who arranged for
some TJF grants for the Auberge des Gouverneurs and the Auberge
Grand-Mère . The trouble was that he was an unregistered
lobbyist and for his work he got an ongoing investigation by the
RCMP.
Why, when this same fellow, René Fugère, came along after the
HRD minister's department twice rejected the application for
another grant, was it suddenly manna from heaven and the
minister's department approved a grant application from the Prime
Minister's buddy?
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, in this particular case we will obtain
the details and provide them to the House.
I want to be clear that in all of these undertakings the
intention was to create jobs to support Canadians in an area of
high unemployment. In all of these undertakings the province of
Quebec had to agree with the undertaking, and it did.
The federal government was but one partner in these
undertakings. There are many others. Fundamentally, they have
made a difference in this riding and in so many others of high
unemployment. Canadians understand that.
Mr. Chuck Strahl (Fraser Valley, Ref.): Mr. Speaker, the
big question is, why did two applications in a row get turned
down by the minister's departmental officials in HRD, but when
Mr. Fugère came along it was pennies from heaven? That $300,000
was given even though the application had been rejected twice
before.
While the minister is investigating she could look at a memo
from August 3 which details how Mr. Fugère went on to say to the
local human resources department in Shawinigan that he had
another deal that he would like to talk to them about as well.
Could she tell us what that deal is?
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, let me remind the hon. member again that
in all of these undertakings the Government of Canada is but one
partner. In the context of community development there are
provincial partners, there are local partners, there are private
sector partners. As a result of these undertakings Canadians who
otherwise would not have an opportunity are working.
[Translation]
Mr. Stéphane Bergeron (Verchères—Les-Patriotes, BQ): Mr. Speaker,
my question as well has to do with Placeteco, which is still not
under investigation at this time, but could be sooner than the
government thinks.
The minister hired a consultant to review the Placeteco file.
The consultant's report was damning, revealing a good dozen
discrepancies.
My question for the minister is a very simple one. Why did her
department go ahead and pay the grant anyway?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, again and again we have talked about
individual projects in the House, and we will continue to talk
about individual projects so that this House appreciates and
understands the investments we are making.
I want to remind this hon. member that the federal government is
but one partner. Madam Harel would have been an approver in this
case. We must appreciate—
1450
Some hon. members: Oh, oh.
The Speaker: Order, please. The Minister of Human
Resources Development Canada.
Hon. Jane Stewart: Mr. Speaker, I was just saying again
that the government in the province of Quebec would also have had
input and would have supported the program.
It is clear that the undertakings we have engaged in are focused
on ensuring that Canadians have opportunities for work.
* * *
NATIONAL DEFENCE
Mr. Hec Clouthier (Renfrew—Nipissing—Pembroke, Lib.):
Mr. Speaker, in my great riding of Renfrew—Nipissing—Pembroke
we have one of Canada's super bases, CFB Petawawa.
I would like to ask the obviously ebullient Minister of National
Defence to expand upon the government's renewed commitment to the
brave Canadian men and women in our military as expressed in
yesterday's scintillating budget.
Hon. Arthur C. Eggleton (Minister of National Defence,
Lib.): Mr. Speaker, yesterday's budget was good news for the
Canadian Forces.
There was a very clear commitment by the government to
strengthen the capacity of the Canadian Forces to do their jobs,
to help improve the quality of life for our troops, to help make
sure they get the equipment they need to do the job, to make sure
they get training and education and leadership development
programs.
I want to thank the hon. member, members of SCONDVA and members
of the finance committee for their support.
* * *
HUMAN RESOURCES DEVELOPMENT
Mr. Rahim Jaffer (Edmonton—Strathcona, Ref.): Mr.
Speaker, now back to reality. René Fugère is an interesting guy.
He can make bureaucrats do a reversal with the mere mention of
his name. He can make public money available where none existed
before. He can make ministers become interested in projects they
ignored before.
Why is it that Mr. Fugère has all of the qualities of the Prime
Minister?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr.
Speaker, this is not in my riding. This is in another riding.
There was a letter written to support the project, which I will
read:
[Translation]
In light of the importance of these jobs for the Obedjiwan
people, and as the member for Champlain, I recommend this
project under the transitional jobs fund.
And it is signed: Réjean Lefebvre, regional president, Bloc
Quebecois, and secretary treasurer of the national caucus.
[English]
Mr. Rahim Jaffer (Edmonton—Strathcona, Ref.): Mr.
Speaker, then why was it rejected twice? It seems that René
Fugère really does well when he gets out—
Some hon. members: Oh, oh.
The Speaker: Order, please. The hon. member for
Edmonton—Strathcona.
Mr. Rahim Jaffer: Mr. Speaker, if the Prime Minister says
that it was so good, then why was the project rejected twice?
René Fugère seems to do really well when he gets out and about
in Ottawa. He does particularly well at HRDC, and we know he is
not fond of registering his lobbying activities.
My question is for the HRD minister and it is very simple. Has
she ever been lobbied by René Fugère?
The Speaker: The hon. member for Winnipeg North Centre.
* * *
THE BUDGET
Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Mr.
Speaker, Canadians heard with disbelief and profound
disappointment that the government's response to the health care
crisis is a one time only, $2.5 billion supplement, spread over
four years, divided between health and education.
Canadians wanted and expected from this government a lifelong
commitment to medicare and all they got yesterday was a one night
stand. This budget has been universally dismissed as—
1455
Some hon. members: Oh, oh.
The Speaker: Order, please. The hon. member for Winnipeg
North Centre.
Ms. Judy Wasylycia-Leis: Mr. Speaker, with respect to
health care, this budget has been universally dismissed as a half
measure, a band-aid, anemic, paltry and a morsel. Canadians can
see it, patients can see it, health care advocates can see it and
the premiers can see it. Why can the minister not see it?
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, this is the fourth budget in a row in which the
government has increased health care transfers to the provinces.
Last year's budget was the largest single investment this
government ever made and it was in health care. Over the last
two budgets there has been a 25% increase in transfers to the
provinces for health care.
In addition, the Minister of Health has asked his colleagues to
meet with him to look at the development of longer term solutions
within the context of the protection of universal health care.
When that happens this government will be there.
Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Mr.
Speaker, what is clear from this budget is that the government
has replaced bracket creep with privatization creep. It is
absolutely clear that the paltry initiative on health care in
this budget is being interpreted as an open invitation for the
likes of Klein and Harris to privatize, Americanize and downsize
our public health care system.
Can the Minister of Finance or the Minister of Health not see
that this budget leaves the door wide open to private, for
profit, two tier health care?
Hon. Allan Rock (Minister of Health, Lib.): Mr. Speaker,
to lend an air of reality to this discussion the member should
know that every year public spending on health in Canada is about
$60 billion. This government transfers to provinces a total of
$40 billion, so naturally we are playing a major role.
The measures announced yesterday are intended to assist
provinces with urgent short term needs. As the Minister of
Finance has just observed, I want to work with my colleagues in
the provinces on a long term plan. A long term plan will involve
long term financing and this government will be there to do its
part.
* * *
[Translation]
HUMAN RESOURCES DEVELOPMENT
Mr. Jean Dubé (Madawaska—Restigouche, PC): Mr. Speaker, not once
but twice, the Obedjiwan sawmill was refused a grant under the
transitional job creation fund by local HRDC offices.
This same sawmill turned to René Fugère, and guess what? A
$300,000 grant was approved.
Can the minister tell us why a friend of the Prime Minister has
more clout in her department than her own local employees?
Right Hon. Jean Chrétien (Prime Minister, Lib.): Mr. Speaker, I
will again read from the letter of recommendation by the
riding's MP, a member of the Bloc Quebecois: “For some years
now, the Obedjiwan people have shown a desire to take charge of
their affairs and to innovate. In this context, one can
appreciate the economic impact of creating 100 jobs for these
people”.
This is a job creation project, such as are to be found in all
ridings. It is an opposition riding, but the Obedjiwan people
wanted to take charge of their affairs and have a sawmill and,
eventually, their project was approved. And this was a riding
represented by an opposition MP.
[English]
Mr. Jean Dubé (Madawaska—Restigouche, PC): Mr. Speaker,
I will ask the question a second time. Not once but twice the
sawmill was refused a grant by local HRDC officials. The same
company used up two lifelines. Then it called a friend, a friend
of the Prime Minister, and guess what? It received a grant of
$300,000.
Can the minister tell us why the Prime Minister's friends have
more influence with her department than her own local HRDC office
employees?
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, let me clarify for the House that in this
particular project the application came when funding had been
frozen in the province of Quebec because we had a number of
projects requiring funding.
1500
As money became available this project was funded because it was
a good project. It was supported by the Bloc member and by the
Government of Quebec. It was expected to create 62 jobs and it
created 66. It gave Canadians in a very remote area the
opportunity to work and we support it.
* * *
THE ENVIRONMENT
Mrs. Karen Redman (Kitchener Centre, Lib.): Mr. Speaker,
yesterday the finance minister pumped $700 million into the
environmental agenda. Can the Parliamentary Secretary to the
Minister of the Environment tell us how this money will enhance
the environment for the people of my riding of Kitchener Centre
as well as all Canadians?
Ms. Paddy Torsney (Parliamentary Secretary to Minister of the
Environment, Lib.): Mr. Speaker, yesterday's budget was great
news for all Canadians. Significant investments will help
develop new technologies to meet the challenges of global
warming, creating competitive advantages for Canadian companies.
New dollars will enable the government to protect species at
risk, to enforce tough new environmental standards and to expand
the Great Lakes action program.
The environmental investment provides Canadians with creative,
innovative ways to build capacity and generate new incentives to
protect our precious environment for all Canadians.
* * *
HUMAN RESOURCES DEVELOPMENT
Ms. Val Meredith (South Surrey—White Rock—Langley,
Ref.): Mr. Speaker, René Fugère has a remarkable ability to
pull money out of many hats. HRDC said that there was no money
available for the sawmill but when Mr. Fugère got involved the
money suddenly appeared.
Is it not true that when Mr. Fugère shows up on one's doorstep
it is the same as a visit from the Prime Minister?
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, there was a freeze on moneys available
for the province of Quebec. The project was a good project. As
money became available we invested in this very rural part of the
province of Quebec because the Bloc member said it was a good
thing to do, the province of Quebec said it was a good thing to
do and the government felt it was a good thing to do. Sixty-six
people are working on a very useful undertaking.
[Translation]
Mrs. Suzanne Tremblay (Rimouski—Mitis, BQ): Mr. Speaker, the
Prime Minister's assistant, René Fugère, is under investigation.
CITEC is under investigation. There is an investigation in
Rosemont into a grant that disappeared into the Prime Minister's
riding, and the Placeteco affair surely merits investigating.
With all these cases in the Prime Minister's riding, does the
minister not think that an immediate, independent, public
inquiry is called for at this time, as the Prime Minister would
say?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, I am glad to report again that of the
thousands of grants and contributions that we make in communities
across this country, they are working. I am also glad to report
again to the House that whenever we receive information, either
from within the department or outside the department, if there
are things that others need to look at, like the police, we send
it to the police.
I am glad to report to the House that whenever we find the
circumstances for an overpayment, we go after the money and we
return it to the Government of Canada.
* * *
TUITION FEES
Ms. Libby Davies (Vancouver East, NDP): Mr. Speaker,
students in this country are really hurting. They are facing
skyrocketing tuition fees and debtloads that have tripled under
the government's alleged commitment to education.
Students were looking for a sign of hope and a dedication of
public funds to education in yesterday's budget. They got
nothing. They got zero.
How does the finance minister justify giving big corporations
and big banks a huge tax break that they do not need while
leaving students out in the cold hurting—
The Speaker: The hon. Minister of Finance.
Hon. Paul Martin (Minister of Finance, Lib.): Mr.
Speaker, I am not quite sure what the hon. member would call
nothing. I would say that increased transfers to the provinces
is substantial. The fact is that increased cultural content on
the Internet so students can take advantage of it is substantial.
Nine hundred million dollars for research chairs and teaching
chairs so the universities can provide a decent education is
substantial. Increasing the tax exemption for scholarships and
bursaries from $500 to $3,000 is substantial.
* * *
1505
ACOA
Mrs. Elsie Wayne (Saint John, PC): Mr. Speaker, my
question is for the minister of ACOA, and it is not about Viagra,
but I do hope that he is going to get straight up and answer the
question.
My question is about a business in my greater riding and it has
to do—
The Speaker: Order, please. This is one question we all
want to hear.
Mrs. Elsie Wayne: Yes, Mr. Speaker, this question is not
hard.
Some hon. members: Oh, oh.
The Speaker: Let us get to the question.
Mrs. Elsie Wayne: Mr. Speaker, a company in my greater
Saint John area applied to ACOA for $500,000 and it was putting
up $385,000 of its own money. It was okayed by the local office
but when it came here the company was told it had to take $1
million. What did Ottawa want it to do with the other $500,000,
send in a contribution?
This is wrong and I want the minister to tell me why this was
done.
Hon. George S. Baker (Minister of Veterans Affairs and
Secretary of State (Atlantic Canada Opportunities Agency),
Lib.): Mr. Speaker, these are certainly times of rising
expectations as far as ACOA is concerned.
I will tell the hon. member about the ACOA management. Prior to
1993 the auditor general and the public accounts showed some
pretty bad investments. However, after 1993, according to the
auditor general, now we have as good as or better a record than
the chartered banks under the Liberal administration. That is
thanks to the good management of the government.
* * *
1510
POINTS OF ORDER
OFFICIAL DOCUMENT
Mr. John Cummins (Delta—South Richmond, Ref.): Mr.
Speaker, to begin with I will quote Marleau-Montpetit, which will
set the tone of what I have to say.
On page 968 of Marleau-Montpetit it states:
It goes on to say:
The editors may likewise alter a sentence to render it more
readable but may not go so far as to change its meaning. Editors
must ensure that the Debates are a faithful reflection of
what was said;
It then goes on to say:
Substantial errors, as opposed to editorial changes, must be
brought to the attention of the House by a means of a point of
order, as soon as possible after the sitting,
On page 769, it says:
A Member may correct the record of his or her own statement, but
may not correct that of another Member.
I will not be long but I think that the matter is important. I
would like to quote, in part, the Prime Minister from yesterday.
This was in response to my supplementary question.
The Prime Minister said:
I would like to inform the House of Commons that in the case of
the riding of Vancouver Island North the riding of the member has
received $52 million in HRDC grants.
He then goes on to say:
These are good programs that we have put in his riding despite
perhaps his opposition because those people do not want us to
help the poor and the needy.
Hansard then says:
An hon. member: Wrong riding.
Some hon. members: Oh, oh.
I find no fault in what Hansard said yesterday but what
bothers me is what came down in the blues. If you will just bear
with me, Mr. Speaker, I will make that, I think, clear to you.
Mr. Speaker, I would like you to keep in mind that a member may
correct only what he says but not what somebody else says.
When I received the blues yesterday my staff noticed that, in
the first sentence that I quoted, the words “the riding of the
member” were not included. The Prime Minister's statement was
altered to remove the words “the riding of the member”. As
well, the word “his” in the sentence “these are good programs
that we have put in his riding” was changed to “this”.
My staff informed the folk at Hansard that the blues were
not an accurate reflection of what was said in the House. What
was said in the House was quite clear.
My concern is that the blues, as we received them, were
inaccurate and a gross misrepresentation of what the Prime
Minister said, and if my staff had not been vigilant and had not
taken the time to read that, an incorrect version of what was
said in the House would have appeared in Hansard.
That bothers me because I do not think it should be my job or
the job of my staff to review what somebody else is saying on the
record in this place and yet it seems that is the case. I would
like to know how that error, an error of that magnitude, could be
made in the blues which we received, because that would have been
the official record as I understand it if we had not been brought
it to the attention of House personnel.
The Speaker: As I understand it, the blues are a first
pass or first cut if you will and notwithstanding the fact that I
am glad that the hon. member did take the time to make the
correction, at this point at least I am not sure that the
correction would not have been made when you put the words which
were recorded in juxtaposition.
We have a recording of what was said and we have it on
television.
1515
It is conceivable that it would have been caught along the way,
but I thank the hon. member for bringing it to my attention. We
must be ever vigilant when this type of thing happens. I believe
his intention was to be of service to the House and I take his
representation as such. I thank him very much.
Mr. John Duncan (Vancouver Island North, Ref.): Mr.
Speaker, I rise on a point of clarification on the discussion we
have just had. When someone asks a question in question period
and there is a response, normally the questioner gets the blues
for the question in his or her office. Unless we make a special
request we do not often get the answer. We just get the question
the individual asked. This leads to a potential vacuum.
As a matter of standard practice it might actually be a more
suitable arrangement to provide both ends of the dialogue to both
parties so that there is a natural check and balance on that
process. I am wondering if that request would be appropriate.
The Speaker: Ordinarily what happens is that when a
specific member asks for the blues we usually interpret that to
be what he or she said in the House. If a member wants extra
information then I am sure it can be provided.
As to it being provided automatically, I do not know if we
should give what is on that page, what is on the previous page,
or what is on another page. For greater certainty, I would
advise that when members ask for their blues, that is what they
said, they can change or at least clarify what they said. Then
if they want the response it should be added to it. In that way
there would be no question about it. Most times they just want
to know that they were correctly quoted in the blues and then
subsequently in Hansard.
Mr. John Cummins: Mr. Speaker, I did not want to turn
this into a debate. It was not my intention, but I think what my
colleague was saying was that vacuum does exist when we only
receive one-half of a discussion. It just happened, I guess
because of the positioning on the paper, that I received the
transcript of what the Prime Minister said, so that check was not
there. It might be helpful, when there is an exchange in
question period, if both sides were distributed. If you could
take that under consideration, Mr. Speaker, I think it might be
helpful.
The Speaker: I am sure the hon. member for Delta—South
Richmond will revisit what I have just said today. He asked me
to take it under consideration. I am always open to advice from
any member of the House.
GOVERNMENT ORDERS
[English]
THE BUDGET
FINANCIAL STATEMENT OF MINISTER OF FINANCE
The House resumed consideration of the motion that this House
approves in general the budgetary policy of the government, of
the amendment, and of the amendment to the amendment.
Ms. Sarmite Bulte (Parkdale—High Park, Lib.): Mr.
Speaker, I will be splitting my time with the member for Stoney
Creek. I rise today to congratulate the Minister of Finance on
budget 2000, the first budget of the 21st century and the next
step in the government's balanced and comprehensive plan to make
Canada the place to be in the 21st century.
I would like to use my time to highlight parts of the budget by
comparing it to the main priorities of my constituents, which
were elicited during prebudget consultations last year. Prebudget
consultations have become an annual event in my riding. Every
year I meet with local business representatives, community
activists and members of various community organizations.
1520
Last year I also distributed a prebudget questionnaire in my
riding and solicited responses through a local newspaper.
Following the consultations I prepared a report which was then
forwarded to the Minister of Finance, the Parliamentary Secretary
to Minister of Finance and to the chair of the Standing Committee
on Finance.
Yesterday the Minister of Finance thanked Canadians who shared
their ideas and insights with the Standing Committee on Finance.
Today I would like to take this opportunity to thank everyone who
participated in my consultations.
When asked what should be the government's main priority in
terms of investing the projected budget surplus, the great
consensus among my constituents was a balanced approach. However,
three major priorities dominated these consultations. First, 40%
felt that the government should continue to repay the debt.
Second, 35% felt that the government should renew spending and
investment in key sectors. Finally, 25% advocated tax cuts.
Virtually everyone during my consultations felt that some action
was necessary to pay down the debt. Every year I am finding
increased understanding of the debt issue: how large it is in
terms of the government's overall finances and how much of our
revenues are eaten up in interest payments. I am increasingly
hearing that if we are unable to retire a substantial part of the
debt during the current relative boom, how will we be able to do
so when some day we face a recession?
Others have pointed out the riskiness in very deep tax cuts
while the debt and interest payments are still so high. Once
again the concern is centred on the prospects of an eventual
recession. If taxes are substantially reduced now, it will be
politically difficult to raise them again in recessionary times.
However, no one has suggested that debt reduction should be the
government's singular priority. Most people felt that we were
now in a position to reduce debt, address a host of social needs
and cut taxes.
What did yesterday's budget say about the debt? The Minister of
Finance confirmed that we would not abandon the balanced approach
which the government adopted from the beginning, an approach
which recognizes that debt reduction, tax relief and spending on
health, post-secondary education and other priorities are not
competing claims but complementary components of a fair and
effective plan.
Let us not forget that the government inherited a record $42
million deficit in 1993. Yet Canada has not just eliminated this
deficit. We are one of the few countries that is now reducing
the absolute amount of its debt and will indeed continue to do
so.
Over the past two years we have paid down the debt by $6
million, resulting in interest savings alone of more than $300
million a year each and every year. The budget also confirmed
that we would continue to set aside a $3 billion contingency
reserve to protect against unforeseen events. In accordance with
our debt repayment plan we will continue to use the contingency
reserve fund to reduce the debt when it is not needed.
Canada's debt to gross domestic product ratio, which measures
the amount of debt against the size of our economy, has markedly
improved. In 1995 Canada's debt ratio was 71%. Today it has
dropped to 61% and we predict that it will fall to 50% by 2004.
Beyond this the downward track must continue. We are still a
long way away from the 25% ratio Canada enjoyed in the late
1960s, which in fact was the last time our books were in the
black.
The second priority of my constituents was increased social
spending with health care, a children's agenda, the environment,
affordable housing and eased access to post-secondary education
being most often recommended. Several constituents in fact
pointed out that spending such as this should indeed be looked
upon as investment in human capital.
I am delighted to advise my constituents that all their top
priorities were also the government's top priorities. In fact
the very first announcement the Minister of Finance made in his
first budget of the 21st century was to increase funding for
post-secondary education and health care. Moreover the Minister
of Finance confirmed “these are priorities of Canadians and they
are ours”.
That is why budget 2000 transfers an additional $2.5 billion over
four years through the Canada health social transfers to help
provinces and territories to address pressing health care and
post-secondary education concerns.
1525
In addition, the Minister of Finance acknowledged that
scholarships and bursaries were an important part of expanding
our access to higher learning. Therefore, to ensure that more
students receive their full value the budget increases the tax
exemption from its current level of $500 to $3,000.
The environment was also addressed in this budget. The Minister
of Finance has made it absolutely clear that protecting the
environment is no longer an option. It is something that we must
do. For Canada to be the place to be in the 21st century our lakes
and air must be clean, our green spaces and diverse habitat and
species must be protected, and we must deal with climate change.
Consequently budget 2000 proposes to invest $700 million to
promote the government's environmental agenda.
The budget also specifically noted that affordable housing was
also an essential element of our modern society and critical to
meeting the 21st century needs of our municipalities. Moreover,
the government announced its intention to improve provincial and
municipal infrastructure in cities by committing $450 million
over the next two years and $550 million in each of the following
four years.
The most important commitment made in the budget was to assist
families and our children. Assisting families is not only the
smart thing to do. It is the right thing to do. Governments can
do this in two ways: through income assistance and support for
services on which so many of our families rely.
Budget 2000 takes action on both fronts. First, it enriches the
Canada child tax benefit with another $2.5 billion by the year
2004, increasing it to more than $9 billion annually. Second,
the budget doubles the duration of employment insurance,
maternity and parental benefits to 12 months.
Very quickly let us go to my constituents' third priority, tax
relief. Although tax cuts were not as widely advocated as debt
reduction and social spending, it was evident that the need for
them is growing. The majority of my constituents advocated tax
relief for lower income families, especially those with children.
Employment insurance premium reductions, indexation and other
across the board tax cuts were also adhered to.
Once again budget 2000 has responded to my constituents'
concern. We have delivered a five year tax reduction plan that
provides an average reduction of 21% to middle and low income
families with children by the year 2000. The budget restores
full indexation to the personal income tax system immediately and
retroactively to January 1, 2000. Over the next five years we
will increase the amount Canadians can receive tax free to at
least $8,000.
The budget also decreases tax rates which have not come down in
the last 12 years. Over the next five years the middle tax rate
will be reduced from 26% to 23%. Effective July 1, 2000, the
rate will be reduced to 25%. In addition, the income level at
which the middle tax rate begins to apply has been increased to
$35,000. Since 1994 employment insurance rates have been reduced
each and every year from $3.07 to $2.40. The budget also assumes
that these rates will continue to fall to $2 by the year 2004.
To conclude, I repeat what the Minister of Finance said
yesterday in his closing remarks:
This is a budget with many elements, but a single theme: creating
better lives for Canadians in a rapidly changing world.
While the budget may have many elements, it attempts to address
the main priorities of not only my constituents but of all
Canadians. It does so with one major objective: to translate
better finances into a better quality of life for all Canadians.
Let us never forget that the values of our society are reflected
in the fiscal choices we make.
Mr. Ken Epp (Elk Island, Ref.): Mr. Speaker, I listened
intently to the speech and was really interested in the
feedback the member had from people in her riding. It is
consistent with what I get from the people in my riding.
I would like some clarification. In the last half of her speech
the member went through her list pretty much in the same order of
priorities as the finance minister did in the budget speech with
debt repayment last. Yet if I heard correctly at the beginning
of her speech she indicated that the highest priority of people
in her riding was to reduce the debt. I think it was around 40%
and that was the highest rate. I am wondering whether the member
would confirm that I heard correctly.
1530
I would also like to remind all members of the House that the
debt reduction plan of the government is dismal indeed. In the
document I received yesterday the net public debt every year from
1998 onward to the projection into the year 2001-02 is $576.8
billion, $576.8 billion, $576.8 billion, $576.8 billion, the same
number four years in a row. There is no plan for debt reduction
at all, except there is $3 billion in a contingency fund and if
we do not find some place to spend it, yes, we will apply it to
the debt.
I would like the hon. member's comments and clarification on
what I think I heard.
Ms. Sarmite Bulte: Mr. Speaker, the hon. member was right. He did
hear that 40% of my constituents advocated debt reduction but I also stated
very clearly that no one in my riding suggested that debt reduction
should be the government's singular priority. Most people felt
that we were now in a position to reduce debt, address social
needs and cut taxes.
There were three approaches and three priorities. One perhaps
is a little ahead, but no singular one was there alone. We
looked at three priorities and that is exactly what this budget
addressed.
With respect to the debt repayment, the hon. member has said
that we do not have any plans at all to reduce the debt but that
is not the case at all. We have reduced the debt by $6 billion.
In fact yesterday in his speech the Minister of Finance also
noted that market debt, the debt which is issued in financial
markets, has fallen even further and by the end of this fiscal
year we will have reduced it by close to $20 billion. So in fact
the plan is in place.
Let us also not forget what the Minister of Finance said
yesterday in his opening remarks. We will not abandon our
balanced approach, the approach that this government has taken
since it was elected to office in 1993. Again we are following
what we said we are going to do. We are tackling the main
priorities of Canadians but we are doing it in a balanced and
comprehensive manner.
Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Mr.
Speaker, I have heard enough from the Liberals today to assume
that each one of them has been handed a little sheet of paper
with a message that says if they are asked questions about tax
transfers and cash for health care, they are to deflect,
obfuscate and confuse and try to suddenly throw in a tax point
argument so that Canadians are put off guard and the Liberals can
somehow finagle their way through this one.
I suggest that all members read page 67 of the budget of 1997
where it clearly says that what matters for program spending is
the cash. The government knows and we know that the cash is
needed to hold provinces accountable to the Canada Health Act.
How does the government intend to do that? If we roll in the
meagre amount that is in the budget, the federal government is up
to a 15% share of health care financing in the country. How is
it going to hold provinces to account and stop premiers like
Klein, Harris and others interested in privatization?
Ms. Sarmite Bulte: Mr. Speaker, first I would like to
assure the member that I have not been passed any notes by any
officials of any department.
I would also like to take this opportunity to tell the member
and all of my constituents that I actually wrote my own speech.
I do not read speeches of the Department of Finance.
The important thing is when we talk about the budget that we
also talk about the things we ask our constituents. In the
economic update in November, the finance minister asked Canadians
to join in the debate as to what to do with that surplus.
What we are going to do with that surplus will determine the
Canada of the future. That is what we did. We went out and
sought Canadians' input, me in my riding. With all due respect
to the member, whom I respect very highly, when she claims that
we are trying to confuse people with tax points, she is trying to
confuse people by saying tax points do not play a role. Where—
1535
The Acting Speaker (Mr. McClelland): Order, please. If I waited
for the member to take a breath, we would still be waiting, but
the hon. member's time has expired.
Mr. Tony Valeri (Stoney Creek, Lib.): Mr. Speaker, it is
certainly a pleasure to speak on the budget today.
As the member for Parkdale—High Park indicated, certainly
members on this side of the House consult with their
constituencies. I did on the prebudget consultation. Quite
clearly what came back from my constituency was the direction to
essentially focus on the tax file and ensure that Canadians are
able to keep more money for their hard work and to ensure the
fiscal management we have provided over the last number of years
is consistent and to also pay down debt.
The member for Elk Island often speaks of debt reduction. On a
constant basis we do provide that continued reduction of the debt
certainly on a debt to GDP ratio basis.
Today I would like to provide brief highlights in terms of the
tax file. I would also like to deal with something specific that
is in the budget, something which I and others in particular
sectors have worked on. That is foreign trade zones, referred to
as export distribution centres in the budget itself.
I will start with the tax file in terms of what we have been
able to provide. We provided some structural changes to the tax
file. The reindexing of the tax system is certainly critical.
Canadians at the lower end of the income scale will certainly
benefit from reindexation. We have provided a reduction in the
middle bracket from 26% to 23%. We will move to 24% relatively
quickly. We will essentially provide a cumulative amount of $58
billion of tax reduction over the next number of years.
Personal income taxes will be reduced on an average of 15%, and
over 20% for Canadian families with children. We targeted the
Canada child tax benefit. Most members know that it is the
government's primary means of helping families. Some 90% of all
children in Canada will receive benefits. Over the past three
budgets we have invested a total of some $2 billion in this
particular program.
Like the Minister of Finance, and I would suspect most members
in the House, I believe that assisting families is not only the
smart thing to do but it is the right thing to do.
We have heard some discussion about the transfers to the
provinces. The budget transfers $2.5 billion in addition to the
$11.5 billion. We should make it very clear as members get up
over and over in the House, as the Minister of Finance got up in
question period, that the additional $2.5 billion is not the last
of our commitment to health care. The ministers of health from
the provinces are getting together in May. They need to put
together a plan that will deal with the health care challenges in
the country. Once they do, and if in fact it does require
additional funding, the Minister of Finance has already said very
clearly that the national government is certainly going to be
there with more money for health care.
As chair of the economic development committee in caucus, we are
presently studying the electronic commerce and the new economy in
Canada. For me in particular I was very pleased to see the
announcements in the budget concerning e-business or e-commerce.
Budget 2000 has put Canada in a stronger position to accelerate
its leadership in the Internet economy and to encourage Internet
investment.
In the papers this morning the managing director of the Boston
Consulting Group of Canada commented on the budget. He is also
the co-chair of the Canadian e-business opportunities round
table. He commented, “It is encouraging to see government
on-line emerge as a major priority in the budget. The government
is dedicating serious money, $160 million over the next two
years”. He went on to comment about the improvements where we
have effectively reduced the capital gains tax by taking it from
75% and reducing it to an inclusion rate of two-thirds and also
the new treatment of the stock options.
1540
In terms of research, innovation and that sector of the economy,
members are certainly aware that there is an additional $900
million put in place with respect to the Canada Foundation for
Innovation. There is the funding of the century chairs for
research excellence. All of these areas speak to the new economy
and speak to the brain drain in a lot of ways. Researchers have
said over and over again that it is research money and research
grants that will allow them to do the work they need to do in
Canada and to not exit the country. That is the kind of
brainpower we want to keep here in our great country.
I am sure members are aware of the Federation of Canadian
Municipalities and its proposal with respect to the quality of
life program. The Minister of Finance has responded with an
infrastructure program, a quality of life program that deals with
road infrastructure and certainly deals with affordable housing
as well.
In my constituency of Stoney Creek there are real demands to
deal with road construction, road infrastructure, urban
congestion and certainly to maintain the trade corridors that we
have been fortunate enough to develop in the province of Ontario.
Let me spend a few moments on what we call the export
distribution centres. When we talk about foreign trade zones
many members certainly associate them with the United States. We
in Canada have a geographic location which we need to take
advantage of. We need to exploit it in fact. Our our proximity
to Europe and to Asia is such that goods that are trying to
access the North American market can flow through Canada. We can
become a gateway to the North American market.
There are changes proposed in this budget that will facilitate
and in a lot of ways create the logistics industry that has been
lacking in this country. The changes proposed in this budget
will allow Canadian companies and entrepreneurs to set up shop
and attract European manufacturers who are looking to access the
North American market. They will allow these Canadian
entrepreneurs to add value, to set up shop and to deal with
products as they flow through to the North American market.
We made some changes back in 1996. We dealt with bonded
warehouses. We dealt with duty deferral programs. That was
initially our response to foreign trade zones. We did not see it
happen. We did not see foreign trade zones begin to flourish in
this country. With the additional provisions in this budget we
are now providing to independent Canadian companies expanded
capabilities to handle goods for overseas manufacturers and to
add Canadian value and content not only free of duty but also
free of GST.
We are also able to attract foreign manufacturers who themselves
can establish operations in Canada within a foreign trade zone to
undertake this value added activity. What does it mean? It means
jobs and additional revenue for us as a country.
A number of Canadian firms are already accessing this type of
provision through U.S. foreign trade zones. We need to
repatriate that type of opportunity. What does that mean? For
communities like Vancouver, Winnipeg, Hamilton and Montreal right
through to Gander, at locations like airports and ports where
there is a natural infrastructure and a natural gateway to the
North American market, it means that these areas can take
advantage of this type of provision.
What does this really mean? The export distribution centres
provision in budget 2000 presents an excellent opportunity for us
as a country with respect to economic development. I mentioned
some cities but that is only to name a few. We can challenge
many others to deal with this export development opportunity.
We have a geographical advantage, as I have indicated. We are
closer to Europe. We are closer to Asia. We need to take
advantage of that. Combined with the announced tax cuts for small
business, the general corporate tax cuts, the personal income
taxes and the improvements in road infrastructure that will take
place when we finally come to an agreement with the provinces and
the regional municipalities, we are positioned with these
provisions to grow a logistic sector and a value added sector in
Canada. It will increase jobs. It will improve the opportunity
for jobs right across the country, from Atlantic Canada to
Ontario, right through to the western provinces and certainly in
Quebec as well.
1545
I urge hon. members to look for this provision in the budget and
ensure that they go back to their communities and talk about it.
It is a great opportunity for economic development.
[Translation]
Mrs. Christiane Gagnon (Québec, BQ): Mr. Speaker, a number of
people are disappointed by this budget, regardless of what the
hon. member of the Liberal party says.
This budget contains some slip-ups. There could have been a
significant sum invested in the social transfer in order to
alleviate the burden of the provinces and to be in a position to
meet the needs of the population.
Earlier in his remarks, the member praised our health care
system, saying that sensitivity to demands in that area was
required.
I would like to quote him from an article in this morning's Le
Soleil, in which Michel Vastel refers to health care
expenditures. He writes:
Where is the hon. member headed with this praise of his
government, saying that it is investing $5.2 billion in response
to provincial requirements in the areas of health, education and
social security?
This morning, I heard what some welfare recipients had to say.
Social housing was forgotten. There was an expectation of
$1.6 billion yearly, for a total of $8 billion, but the figure
ended up being a pitiful $57 million over four years. The hon.
member better not try to tell me that this budget shows the
government has its heart in the right place.
I wish to hear his reply to this.
[English]
Mr. Tony Valeri: Mr. Speaker, I am very pleased to
respond to the hon. member. When we look at the investment of
$2.5 billion as an increase in transfers I think we ought to look
at it in the context of the additional $11.5 billion in the last
budget. I said earlier in my speech that the commitment to
provide additional money for health care is certainly there. It
has been made by the finance minister. It will be incumbent on
provincial health ministers to come up with a plan that will
work.
I also want to mention to the hon. member, since she brought up
the question of transfers to the provinces, that she should not
forget that the province of Quebec is one of the provinces that
receives equalization payments.
I do not know whether this is the correct figure but I am sure
it is in or about an approximate one. In the last budget we had
about a $1.4 billion increase in equalization payments which I
believe the province of Quebec put to its bottom line. It
certainly had an opportunity to continue to run the deficits as
it always does in that province or to put that increase in
equalization payments into health care. It had the opportunity
but it chose to put it to the bottom line.
Mr. Deepak Obhrai (Calgary East, Ref.): Mr. Speaker, I
heard the hon. member talk about business opportunities, trade
zones and the investment into infrastructure that this budget
addresses.
I remind the member on the opposite side that due to his
government's inaction trade with Europe has fallen dramatically.
We know that it is on the rise, but what it used to be
historically is not there due to the government's high taxes over
previous years.
The hon. member talked about infrastructure. This budget has
only committed $150 million toward infrastructure. We know, and
everybody knows, there has been a huge outcry because of a need
for infrastructure investment. Why did his government not use
the dedicated taxes it collects and invest them in
infrastructure? Why was such a key area not addressed in this
budget?
1550
Mr. Tony Valeri: Mr. Speaker, in response to the hon.
member's question about trade with Europe, the hon. member said that
the lack of trade or the reduction in trade with Canada was particularly
due to the high corporate taxes in Canada.
Perhaps the hon. member would like to travel to Europe at some
time, or I could provide him with some reading material which
shows that most European countries have higher corporate taxes,
certainly higher payroll taxes, than we have in Canada. The
member opposite is often on his feet advocating that payroll
taxes are job killers and reduce the outflow of the economy. Yet
he makes reference to Europe.
When I talk about foreign trade zones it presents an opportunity
for the hon. member to go back to his community and do his part
in terms of trying to increase trade with European countries, to
use Canada as the gateway to the NAFTA countries, and to ensure
that perhaps individuals in his community have the opportunity to
employ and/or set up the entrepreneurial corporations I have
described.
[Translation]
Mr. Richard Marceau (Charlesbourg, BQ): Mr. Speaker, I am
pleased to rise in the House today to address the budget.
One thing that struck me yesterday, both in this House and
outside—from what we could see and hear—is that Quebecers and
Canadians no longer trust this government to manage public
funds, absolutely not. There are a number of reasons for this,
the main one being, of course, the ever bigger scandal at Human
Resources Development Canada.
When this government gets its hands on public money, what it
does with that money is far from being for the well-being of the
general public.
More specifically, as regards this budget, we can mention three
major disappointments shared by many people.
First, there is no real tax relief this year. The
government had promised to lower taxes. It even boasted about
it, saying “Yes the tax burden of Canadians and Quebecers will
be reduced”. Well, it is not the case this year.
Second, the transfers to the provinces are ridiculously low
compared to the needs that the provinces must meet year after
year.
Finally, some claim that this government's heart is in the right
place. Nothing could be further from the truth, because there is
absolutely nothing in this budget for the poor and the
unemployed.
I will discuss each of these points separately.
I could talk for hours about these issues. Unfortunately, we
have very little time. Yet, we could level many criticisms at
this budget.
Everyone knows the priorities of Quebecers and Canadians are
health care and education. We know. We hear it talked about
everywhere. So what is there in this budget for health and
education? Pittance.
They talk of an increase of $2.5 billion over four years, when
the provinces were unanimously calling for $4.2 billion this year
alone, increasing to $4.4 billion next year and $4.6 billion the
following year, that is, indexed for the following years. And
what will they get? A mere $2.5 billion over four years.
The Minister of Finance could have done a lot better with the
surpluses he has. He talked of $95 billion over five years, when
we know very well that he will have $137 billion available over
five years. The Minister of Finance is playing squirrel again.
We also learn that the $2.5 billion allocated to the one time
payment for health and education will be charged to 1999-2000.
Another game of the hand is quicker than the eye to make the
surpluses the government has in hand disappear.
1555
The minister is keeping his old, less than transparent
management practices. They are camouflaging figures to make us
believe that Ottawa does not have the means to give back to the
provinces, and Quebec especially, what it stole from them for
its election coffers.
There is worse to come. Quebecers, who are watching us, and I
know there are many of them, realize that Quebec is the real
loser in this political announcement, despite what my Liberal
predecessor was saying. After being forced to cut in health
care, education and social assistance, Quebec will bear over 50%
of the total cuts to the Canada social transfer.
It represents 25% of the population but it has to absorb 50% of
the cuts. That is what federalism means for Quebec.
By including tax points, the Minister of Finance is saying that
the total Canada social transfer between 1999 and 2004 will be
$156 billion. I think the time is long overdue to lay the tax
point myth to rest.
The increase to $156 billion is due solely to the value of tax
points which, for the same five-year period, will increase from
$14.9 billion to $17.2 billion. These tax points are not
transfers. They are revenues that belong, and have long
belonged, to the provinces and to Quebec.
According to the federal government, the Canada social transfer
constitutes a transfer of cash and tax points.
But the Canada social transfer does not consist of cash
transfers alone, because the federal government turned over the
tax points a good thirty years ago, before I was born.
Furthermore, the federal government has no say in how these tax
points are allocated. So always wanting to include tax points
in the Canada social transfer is completely ridiculous and
completely misleading.
What does the Minister of Finance also say? He says “Canada
Health and Social Transfer payments will be increased by $2.5
billion. This budget announces an additional $2.5 billion in
CHST support, providing an added $1 billion in 2000-01 and $500
million a year in each of the following three years. This means
that the cash component of the CHST will reach $15.5 billion in
each of the next four years”.
Cash transfers will not be raised $2.5 billion, because they will
be put in trust, temporarily at least, until the enabling
legislation is passed. This has not happened because of the
decision by the Bloc Quebecois, in response to the demand of the
people of Quebec, to ensure that Bill C-20 and all other bills
introduced by this government are, if not blocked, at least
slowed down.
Returning to this trust, we do not know what this is. Does
this mean that the social union is going to apply from now on to
cash social transfers? Is this to prepare us a bit in advance
for the “coast to coast” programs that are the dream of several
of those ministers and members across the way, who love to spend
money? All this is yet to be determined? We do not know yet?
Returning to the cuts, they are a great little horror story for
Quebec.
Between 1994 and 2003, the provinces will have undergone
$33 billion in cuts under the Liberal administration. In fact,
even if the ceiling for the social transfer is raised from
$12.5 billion to $15.5 billion in coming years, Quebec's share
will drop from $3.9 billion in 1999-2000 to $3.6 billion in 2002-03.
What is Ottawa trying to do? Ottawa wants the provinces to
struggle, their heads barely above water, while it is floating
nicely along amidst a huge surplus. This is one concrete
example of the extreme federalism against which Yves Michaud
spoke out not so long ago. They want the provinces to be
nothing more than big municipalities, with Ottawa calling the
shots and the provinces carrying them out. What they are in the
process of doing with the social union is to turn Canada into a
kind of de facto unitary state.
1600
This may not be what the texts say, but in fact, with the
enormous surpluses Ottawa is reaping and the fact that it is
keeping the heads of the provinces barely above the water line,
federalism is less and less a fact. Increasingly, we are
heading toward a de facto unitarian government.
As for the transfer of funds with the Canada social transfer,
the provinces' situation is not improving. The cuts by the
federal government have hurt very badly, especially in Quebec
where the per capita shortfall in 1999-00 is $225 as opposed to
$121 for Ontario and an average of $138 for Canada.
Once again, Quebec is being had. What is even worse is that the
ministers and Liberal members are saying “Yes, go on, hurt us,
we like that.
Go after Quebec, take more money away from it than from the
other provinces. Take more, we like that, we are going to stand
up on our flippers and applaud like seals for the Minister of
Finance, who comes from Quebec, and does it more harm than he
does to all the other provinces”. This is unacceptable, it must
be made known and condemned.
The annual shortfall for Quebec is $1.7 billion. The effect is
dramatic. It means a shortfall of $875 million for health care,
$375 million for education and $450 million for social
assistance. What does it mean specifically? An additional $875
million for health care would mean the creation of over 3,000
jobs for doctors and 5,000 jobs for nurses. Why do we not have
them? Because this government decided to cut health care and
education.
It is interesting to compare Ontario and Quebec. Since it took
office, in 1993, this government did not merely make cuts to
cash transfers. It also unilaterally—they like that word, across
the way—decided to change its method of calculation, at the
expense of Quebec.
The Liberals respond to accusations of having sabotaged health
care by saying that all the provinces suffered cuts, this in a
fair manner, and that it is the fault of the sovereignist
government in Quebec City if things are not going well in our
province.
In fact—and everyone knows that, as I found out when I recently
travelled across Canada—all the provinces suffered cuts. The only
common denominator between all the provinces is the federal
cuts.
As for the alleged fairness of these cuts, the federal
government put in place, as early as in the 1996 budget, a
mechanism “to reduce current disparities in per capita
entitlement between the provinces by half by 2002-2003”.
The mechanism in question would have increased the per capita
weighting from 10% in 1998-1999 to 50% in 2002-2003. But, in the
1999 budget, without a word of warning to Quebec, the federal
government proposed “to completely eliminate these disparities
in three years, that is by the year 2002”. This means that
Quebec will absorb 50% of the cuts, when it only accounts for
25% of the country's population. This is the price to pay for
federalism; this is the price to pay for not having achieved
sovereignty.
The Liberal member who spoke before me talked about tax
reductions. He stressed non-indexation, the fact that the
government is again indexing tax tables.
Let us be clear—indexing is not a real tax cut. With indexing,
the taxpayer does not pay more, but he does not pay less; the
effect is neutral.
We are most certainly in agreement with deindexing; we have been
pushing for it for five years and it is time the government
listened to us. In fact, I think that if it listened to us more
often, things would improve.
That having been said, it could have done more. It could have
reindexed the tax tables, as well as making significant tax
cuts, which it decided not to do. Even though it is raking in
surplus after surplus, this year it consciously decided not to
give the public tax cuts.
1605
Since 1993 when this government took office, the non-indexing of
tax tables has accounted for between approximately $12 billion
and $17 billion. Surely, with the surpluses it has, it could
have relinquished a small portion of this large amount, but it
made a conscious decision not to do so.
It proudly announces that it has eliminated the 5% surtax this
year for incomes under $85,000 and that it will eliminate it for
all incomes over the next five years, by 2004. The complete
elimination of the 5% surtax in 2004 will result in a tax cut of
approximately $5,600 for the 61,000 taxpayers earning over
$250,000. Meanwhile, it will be less than $100 for middle income
earners, who make up the majority of those listening.
Is this fairness? Is this justice? No way.
The third point I wanted to raise is the lack of any improvement
to the employment insurance program for the least advantaged
members of society. Yet the demands of the Bloc Quebecois were
very clear. Our party made itself the spokesperson of a
consensus that exists, not just within Quebec, but in the rest
of Canada as well.
The Bloc Quebecois called for five main points.
These were: that the employment insurance fund no longer be used
as a tax on employment; that the administration of the
employment insurance fund be depoliticized and removed from
government control, or in other words made into an independent
fund; that the employment insurance fund conform to the
objectives of the legislation, which is to ensure the unemployed
of a decent and fair income during temporary periods without
work; that priority be given to returning to contributors the
benefits to which they are entitled; that it retain its role as
an anticyclical measure.
Yet this budget contains nothing for the unemployed, which means
that, in the aftermath of this budget, six out of ten jobless
people will still not qualify for employment insurance.
In addition, this budget contains some measures that are
specifically anti-Quebec.
I shall mention four of them. The first one relates to the
shipbuilding industry.
The federal taxation system has just taken back the assistance
Quebec has given to this industry in decline, assistance that
the Government of Quebec had been intelligent enough to put into
place. I come from the Quebec City region, where the Davie
shipyard is important for employment. Yet the federal government
is doing nothing, worse than nothing, for it is taking back part
of the assistance the Government of Quebec had given to an
industry that has unfortunately been in decline because of the
federal government.
Second, the budget tabled yesterday in the House of Commons will
include retroactive taxation of the super-deduction for R and D
credits announced less than a year ago by the Government of
Quebec.
For about 12 years now, Ontario has benefited from such a super
deduction. Less than 10 months ago, Quebec set up a similar
program and guess what happened? The federal government pulled
the rug out from under the province by ensuring that the super
deduction cannot benefit people working in research and
development in Quebec.
Third, there is the deduction for interest on student loans. We
are well aware that Quebec made a conscious choice to have the
lowest tuition fees in North America, because we feel this is
the best way to ensure the greatest possible access to
post-secondary education. That approach has worked. However,
because Quebec students are paying lower tuition fees and are
therefore less indebted, they are getting less from the federal
government. This is unfair.
Quebec adopted a very progressive and modern social measure to
promote access to university, and what did the federal
government do? It made sure that students from the rest of
Canada can benefit a lot more than Quebec students from the
deduction for interest on student loans. Quebecers are
supporting students twice, first by paying taxes so that tuition
fees are the lowest in North America and, second, by helping
students in the other provinces, because they made a conscious
decision to have lower tuition fees.
1610
The fourth anti-Quebec measure in this budget concerns the
deductions for daycare. Less is paid to Quebec families,
because they pay less in daycare costs since the Government of
Quebec established a $5 daycare plan.
Quebecers are being penalized once again for creating an
innovative program, praised by many and the envy of all across
Canada.
There are four anti-Quebec measures in this budget.
You are signalling me, Mr. Speaker, that my time is almost up,
and I want just to respond to the Liberal member who spoke
before me. He said that Quebec received more than its share in
equalization payments and so on.
If so, it is because it does not get its fair share in active
spending, in structuring spending.
Let us talk about all of this. Quebec got an average of 21% of
federal purchases of goods and services, 15% of current
transfers to business, 18% of federal government investment
between 1992 and 1997. In 1998, this translated specifically
into 19.5% of jobs in the public service and 19.1% of jobs in
the armed forces, whereas Quebec represents 25% of the
population.
Quebec's annual shortfall in federal purchases of goods and
services, the difference between Quebec's population size and
the share of federal spending the province receives, is $1.2
billion. In the case of current transfers to business, the
shortfall is $339 million and, for investments, the figure is
$219 million a year.
I conclude on this.
If the federal government gave Quebec its fair share of job
creating spending, that is, $1.7 billion, over 30,000 jobs could
be created in Quebec, which would mean a .7% drop in the
unemployment rate. The unfair distribution of spending could
explain as much as 50% of the difference between the
unemployment rate in Quebec and in the rest of Canada.
That is the cost of not having sovereignty.
[English]
Mr. Ken Epp (Elk Island, Ref.): Mr. Speaker, I listened
with some interest to my colleague from the Bloc. I want him to
know that as an Albertan, as a member of the Reform Party and as
a member of the House I consider him to be part of the Canadian
family. He is a Canadian. He lives in Canada and he serves in
Canada's parliament.
I heard throughout his speech too often that Quebec was not
getting its fair share. I have done a little study on
equalization, which is what he was talking about. As I recall,
the Quebec population is now about 24% of Canada's population.
The numbers I have over the last 10 years show that of the
equalization that was paid out to the seven so-called have not
provinces, which excludes Alberta, Ontario and British Columbia,
Quebec received in excess of 60% of the money as a percentage.
Overall in Canada, including all ten provinces, Quebec received
between 40% and 50%. The peak was around 48% in one year
according to my records.
With a population of 24% and getting 48% of all equalization
payments in the country, how can the member say that Quebec is
not getting its fair share? It is getting twice the average,
which seems to me to be inconsistent with his statement. Before
I sit down, with that I would like to invite him to stay in
Canada.
[Translation]
Mr. Richard Marceau: Mr. Speaker, the response to his invitation
is no.
As for the first part of his comment—for which I thank the
member, who is one of the hardest working members in the House—he
suggests that Quebec is the spoiled child of the federation and
that it is receiving more than its share of federal spending.
I wish to remind him that if Quebec is receiving more than its
share of provincial transfer payments for employment insurance,
it is mainly because it is not receiving its share of spending
to create jobs.
1615
Some spending produces nothing because the money goes to people
who stay at home, which does not create any jobs, and some
spending that produces jobs.
Quebec is not receiving its share of the money that creates
jobs. I will repeat a few figures that I gave just before
concluding: 21% of federal goods and services are purchased in
Quebec, and yet we represent between 24% and 25% of the
population; 15% of current transfers to businesses, and yet we
represent 25% of the population; 18% of federal investments
between 1992 and 1997, and yet we represent 25% of the
population.
Quebec's annual shortfall with respect to federal goods and
services spending is $1.7 billion. This represents 30,000 jobs
in Quebec and an approximate drop in unemployment rates of 1%.
If, instead of doing all its investing in Ontario, the
government ensured that Quebec received its fair share, then we
could talk again.
[English]
Mr. Alex Shepherd (Durham, Lib.): Mr. Speaker, I am
always fascinated when members of the Bloc talk about fiscal
matters because they certainly are inventive and imaginative
about the way they restate the books and the public accounts of
Canada.
I share with the member for Elk Island the frustration that we
have in constantly having to rise to point out the fact that
Quebec does quite well by this country. That does not mean that
it is favoured or pampered, but Quebec certainly gets its fair
share. Having people say that it does not, that it is
discriminated against, is, quite frankly, untrue and an insult to
our country.
The member talked about moving toward a unitary state. There is
no one who has studied political science or social policy, not
only in Canada but throughout the world, who would not say that
Canada is the most highly decentralized federation in the world.
I want to address the issue of tax points. The member went on
and on about tax points. It was once again creative economics.
A lot of people do not understand tax points. Let us say that
the federal tax was at 40%. I will use that figure for
simplicity. The federal government, in agreement with the
provinces, including Quebec, said that instead of the government
taxing the provinces at 40%, it should reduce the tax by 3 or 4
percentage points and the provinces would take that back.
Individual taxes would be the same. The federal government would
reduce its share of direct taxation on individuals and the
provinces would be able to tax directly. This was done and I am
sure the province of Quebec felt it was a wonderful thing because
it could tax the people directly to raise money for its social
programs.
I would be very interested in knowing if the member is
suggesting that we reverse the original concept of tax points and
have the federal government reoccupy that level of direct
taxation, with the province of Quebec similarly reducing the
amount which it taxes Quebecers directly.
[Translation]
Mr. Richard Marceau: Mr. Speaker, I hope I have 20 minutes
or so to respond, because it is not often that one hears such
utter nonsense.
As far as the unitary state is concerned, yes we are heading
more and more in that direction, and I trust the hon. member for
Durham is listening. His government has implemented what is
called the social union. What does social union mean? That the
federal government can, merely by notifying the provinces—this is
also going to interest my colleague from
Anjou Rivière-des-Prairies—interfere in any provincial area of
jurisdiction. What is that all about? Is this still
federalism? According to what I learned in my law courses, any
federalism requires totally different “spheres of sovereignty”
for the different levels of government.
When the federal government gives itself the right and the
power to interfere in areas of jurisdiction that do not belong
to it, this is no longer federalism, and Canada is moving more
and more toward a system in which Ottawa dictates to the
provinces.
1620
Nine out of ten provinces are relatively okay with that having
signed the social union. Why? Because for them the “national
government” is located in Ottawa. For them the supreme
representative of their interests is in Ottawa.
For Quebecers, however, whether federalists or sovereignists,
their national government is in Quebec City. This is why the
three political parties represented in the National Assembly,
including the strongly federalist Quebec Liberals, refuse to get
involved in such a system, and reject the social union proposed
by their federal cousins, rightly so, moreover.
There is one other thing that the hon. member referred to, and I
am not sure I grasped it properly.
He talked about occupying tax fields, wondering, I think,
whether the trend that has existed since 1960 had to be
reversed.
The transfer of tax points essentially stopped in the 1960s,
unless I am mistaken, after another Liberal government, under
Pierre Trudeau, decided to take a harder federal line and to
centralize Canada increasingly rather than remain flexible.
Flexible federalism does not exist in Canada.
With surpluses estimated at $137 billion, the provinces have the
need, and the federal government has the money. The federal
government is very tight with its money, because it refuses to
give back to the provinces what it took from them, while the
provinces' needs in health care continue to grow, as my
colleague from Québec among others pointed out a little earlier.
As I said earlier, I think rightly, the federal government is
keeping the provinces struggling, their heads barely above
water, while it is rolling indecently and disgustingly in
surpluses.
[English]
Mr. Ted McWhinney (Vancouver Quadra, Lib.): Mr. Speaker,
I will be sharing my time with my colleague, the member for
Barrie—Simcoe—Bradford.
It is a pleasure to support this budget. It is a budget for the
21st century, the knowledge century, and that is the element of
the budget that I will signal in my remarks.
You will remember, Mr. Speaker, the tragedy of the failure of
the KAON project, launched by a man of genius, Erich Vogt, but
allowed by a previous government to fail for lack of financing.
Why did it fail? The previous government, one, did not
understand the nature of pure research and its importance for a
modern society and for a viable economy, but, two, had doubts
about constitutional power, which on examination were
unreasonable. “The constitution”, as Lord Sankey said, “is a
living tree”. Where the social necessity exists the power will
follow for rational men and women.
The KAON project failed and our first mandate when this
government was elected in 1993 was to support the successor, the
TRIUMF project. It was a period when we had inherited a $42.8
billion deficit budget from the predecessor government. We were
asking for $167.5 million to support the TRIUMF project. It took
12 months of discussion in caucus and in the House to explain
what pure research is. It is not an esoteric examination of
subjects fit for angels but for no one else; it is an examination
of the basic intellectual infrastructure of our society. It
meant explaining what is particle physics, why is particle
physics important to us, that when properly applied in its
lessons it leads to highly skilled jobs, it leads to an export
economy.
That was the demonstration made with the TRIUMF project. We
were able to demonstrate $193 million in export contracts in a
single year in spinoffs from TRIUMF. So the battle was won, pure
research, the thing that saved Germany and Japan after their
devastating defeats and the devastation of their industries in
the second world war. Invest in pure research. The federal
government has never really looked back from that.
Therefore, it is perhaps a matter of interest to note that we
can believe newspapers sometimes. The Vancouver Sun has in
some ways jumped the gun and suggested that TRIUMF may be
refinanced.
I believe the announcement will come next week, but let us face
it, TRIUMF was when we turned the corner in the federal
government and said that research in the areas of science,
technology and medicine was crucial to our survival as a
competitive country in the 21st century.
1625
I look through this budget and I see the follow-on of this
distinctive philosophy of the knowledge society being carried
through. There is a project in which major intellectual
contributions were made by Dr. Martha Piper, the president of the
University of British Columbia, a distinguished research
scientist in her own right, and Robert Lacroix, the rector of
the Université de Montréal. It is the establishment of the
millennial professorships with 2,000 new university research
chairs across Canada and $900 million invested by the federal
government.
Why do we spend this money? We want to keep these people in
Canada. There are Nobel prize winners there already, but there
are also the Nobel prize winners of tomorrow. These are the
people who expand the frontiers of knowledge. So that is a very
positive step.
I look back at the Foundation for Innovation established with a
billion dollar grant by the federal government, with a further
$900 million in this budget. This is to provide for innovative
research, science, medicine, the equipment of laboratories and
the basic infrastructure of research in universities. Dr. David
Strangway, the former president of the University of British
Columbia, has been extending this in his administrative talent.
It is a very vital task.
We took the science minister on a visit to the University of
British Columbia and told him that we wanted him to see an
historic laboratory. We took him to the second floor of the
science building and he asked what was historic about it because
it looked like an ordinary rundown university science laboratory,
with not enough equipment and out of date. We said that was
where the last Nobel prize winner from Canada went as a graduate
student and did his research. It is still in the same condition
it was in when he attended 30 years ago. It needs rebuilding.
The creative idea for the Foundation for Innovation comes from
there.
There has been talk of federal-provincial co-operation. We
devised this concept of co-operative federalism. I look at the
Canada health and social transfer program, with $2.5 billion for
that, of which $340 million will go to British Columbia. We wish
to co-operate with the provinces, but it is a two-way process. We
are tired of giving money—and I think even British Columbia may
feel some guilt here—for education or research and finding that
it ends up in highways with no end and no beginning, into the
never never land. We extend the invitation to the new premier,
sworn in several days ago in British Columbia, to come and join
us, to spend this money, this transfer, on education, on
post-secondary research and on work in the hospitals. We will
work with him if we can.
I look at money for forestry research. It is British Columbia's
basic industry but it is in some sickness today. We need
research in new methods and new technologies. The $15 million is
for the three forestry research institutes scattered over Canada.
There is $160 million for Genome Canada to advance the study of
genetics. It is led by Dr. Michael Smith, the Nobel Laureate in
chemistry. He knows both the possibilities and also the prudent
restraints in the application of this new science to plants and
to other forms of research. This is a most interesting aspect of
the budget.
There is $100 million in the sustainable development technology
fund. A good deal of this will go to companies like Ballard
Power, the new fuel cell technology that can revolutionize
transportation and at the same time reduce to minor proportions
the problem of pollution that conventional batteries create with
the power involved.
If one looks through the budget, there is $5 million for
geoscience to improve new techniques for mining.
1630
Our mining industry needs revitalization. Abstract research?
Not on your life. The jobs of tomorrow are there. They are
highly paid jobs and vital to our economy.
Over this whole spectrum of work we see an imaginative budget
that looks forward, not backward. It uses our surplus at once to
reduce taxes, to stimulate the economy in that sense but also to
create the knowledge that is the basis of breakthroughs in
science and technology which are in essence the foundation of our
industry and of our competitive economy with the opportunities for
brilliant young Canadians who might otherwise be lured by the
temptations to go south and follow the brain drain.
We can keep these people in Canada. We need them. We invite
the provinces to co-operate with us. It is a two way process but
the basic foundations are there.
It is a pleasure to assist the adoption of this budget, the
knowledge budget, a budget for a knowledge based economy. That
has been the inspiration of our government, the science minister,
the finance minister and the Prime Minister since the inception
of this government.
It comes to fruition here with a budget with the first big
surplus. All the hard work of saving, prudent pruning of
overstaffed departments and the like comes to fruition here with
the stimulus we have provided for the economy.
[Translation]
The Acting Speaker (Mr. McClelland): It is my duty, pursuant to
Standing Order 38, to inform the House that the questions to be
raised tonight at the time of adjournment are as follows: the
hon. member for Regina—Lumsden—Lake Centre, Gasoline Prices; the
hon. member for Mercier, East Timor; the hon. member for
Cumberland—Colchester, Airline Industry; the hon. member for
Mississauga South, Foreign Affairs.
Mrs. Christiane Gagnon (Québec, BQ): Mr. Speaker, I was anxious
to address the budget.
Budget day is always an important day for Canadians, for people
in all the provinces, including Quebec, because they want to
find out what impact the budget will have on their daily lives.
Today, Oral Question Period focused on the current scandal at
Human Resources Development Canada. This is not because the
budget is not a priority, an important issue for members of
parliament, including Bloc Quebecois members, but because we
wanted to show how badly this government has failed, in terms of
managing programs, of managing one of the most important
departments.
This is not the first time.
I remind members that in 1984 the federal government lost $1
billion hole through a new tax to promote scientific research.
That tax loophole resulted in the robbery of the century. Over a
nine month period the tab climbed to $3 billion, while the cost
of that initiative was expected to be $100 million.
Considering all these losses created over the years by Liberal
patronage, considering the measly $2.5 billion that will be
paid, I thought the member would have had a more balanced
approach, a vision regarding the needs of the provinces in
health and education—
The Acting Speaker (Mr. McClelland): I apologize for
interrupting the hon. member but I must give the floor to the
hon. member for Vancouver Quadra for his answer.
Mr. Ted McWhinney: Mr. Speaker, if we are talking about the
management of these projects, we are talking about Martha Piper,
Robert Lacroix, David Strangway, and Michael Smith. These are
well known scientists and physicians; we trust their advice and
judgment. That is why I strongly supported their appointments.
I have complete faith in their judgment.
1635
[English]
Mr. Pat Martin (Winnipeg Centre, NDP): Mr. Speaker, the
Liberal members on the other side are doing a very good job
cheerleading and boosting their budget, but I can guarantee
that not everybody in the country is doing cartwheels in quite
the same way.
We have received a series of critical faxes from organizations
like the Canadian Medical Association, the Canadian Health Care
Alliance, the Canadian Federation of Teachers and the Canadian
Chamber of Commerce that point out the irony of this.
In a budget, in which the primary focus and concern was to fix
health care, we have seen a meagre and paltry $2.5 billion. I
remind the hon. member for Vancouver Quadra that in the province
of Manitoba that amounts to about $20 million per year over four
years. This is an amount of money that is almost insignificant.
It does not register in the total overall health care spending.
Of all the initiatives and the lofty ideas the member had in
terms of spending and reinvesting in the knowledge sector and
post-secondary education, what does he suggest Manitoba should do
with its $20 million for health care, post-secondary education
and social allowance?
Mr. Ted McWhinney: Mr. Speaker, I accept the challenge. I
think the MPs from Manitoba should do what I have been doing for
the last six or seven years.
I have no reproach for engaging myself in boosterism. I
explained what pure research was in the House. I explained it to
my caucus. I persuaded people. I and my office staff spent 250
hours of work on the TRIUMF project. We had the good fortune to
have a science minister who, although a very distinguished
lawyer, was not a scientist in the natural science sense but who
took the time to understand.
The main thing is that we have made a revolution in Canadian
society. Our research and advanced education was lagging behind
in significant sectors. We went to the Prime Minister and said
that he must invest. I make no apologies for that. I would
offer the same advice to our colleague opposite who asked the
question. Go out and fight for knowledge. He should go out and
fight for projects he believes in but he should bring reasoned
empirical arguments.
When I went to the science minister and said that these were the
facts, he read the documents, listened to the arguments and he
approved. That is the way to do it.
Ms. Aileen Carroll (Barrie—Simcoe—Bradford, Lib.): Mr.
Speaker, at the outset I offer my congratulations to the Minister
of Finance for crafting a budget of remarkable scope and balance.
The minister has remained to true to his course and, as well, has
responded to continued input from the Liberal caucus.
I have spoken in my riding of Barrie—Simcoe—Bradford to many
groups at various times about how committed the government has
been to realigning the federal balance sheet, getting our
finances in order, eliminating the deficit and planning for the
day when we would be able to return dividends to Canadians for
their investment in successive Liberal governments.
Canadians, including my constituents of
Barrie—Simcoe—Bradford, have invested in this government. They
have given us their trust to restore our nation's finances. They
have shown confidence in us to build a stronger, more innovative
economy. They have trusted us to improve the quality of life for
them and their children.
The time has now arrived when we begin to repay Canadians for
supporting our plan.
A key component of my government's plan is to cut taxes. This
will mean more money in the pockets of Canadians, stronger
economic growth, continuing job creation and the enhancement of a
more competitive edge for Canada globally.
The five year reduction plan that will restore full indexation
to the personal income tax system is an essential ingredient of
this budget. Core tax rates are reduced for the first time in 12
years. Personal income taxes are being reduced on an annual
basis by an average of 15% in 2004-05. This plan will reduce
taxes by a cumulative total of at least $58 billion over the next
five years.
Full indexation is a fundamental break with the past and is a
measure requested by many of my constituents. I am heartened
that the Minister of Finance has heard those of us who have
advocated for this tax change, and I thank my constituents who
persisted in raising this issue on various occasions over the
last three years.
Full indexation will stop the automatic tax increases and
benefit erosion that have taken place under our Canadian tax
system since the mid-80s. For the first time the real value of
benefits, such as the Canada child tax benefit and the GST tax
credit, will no longer be eroded by inflation.
1640
For the first time in 12 years a federal income tax, the middle
tax rate, will be lowered. The plan reduces the middle tax rate
to 23% from 26%, starting with a two point reduction to 24% in
July of this year. Eventually this will cut the taxes for 9
million Canadians.
The bottom line is that Canadians will be able to earn more
income tax free and more of their income will be taxed at lower
rates. This is the dividend Canadians have earned for their
patience and fortitude in supporting the Liberal plan to get the
federal fiscal house in order.
The plan enriches the Canada child tax benefit so that by 2004
an additional $2.5 billion annually will be provided to low and
middle income families with children. This measure alone
provides increased income for more than half of my constituents
in Barrie—Simcoe—Bradford.
The plan eliminates the 5% deficit reduction surtax on middle
income Canadians with incomes up to $85,000, and the plan raises
to 25% this year and 30% next year the permissible foreign
content of investments in registered plans and RRSPs. This is a
measure that I and many of my colleagues have been promoting. I
am very pleased that we have seen its accomplishment.
For students, I, along with many of my colleagues, was alerted
by post-secondary institutions and student associations that the
level of taxation on scholarships did not synchronize with the
objective of reducing student debt load. Consequently, the
government listened and it responded by increasing to $3,000 from
$500 the amount of tax free income from bursaries, fellowships
and scholarships, such as the Canadian millennium scholarship.
Other tax reduction measures include a reduction in capital
gains from 75% to 65% effective immediately. In fact, this plan
is so munificent that the opposition, which has been militant in
its pursuit of a tax agenda, cannot even come up with a response.
Even Owen Lippert, spokesman for the conservative Fraser forum,
complimented the budget and the tax cut plan on this morning's
edition of Canada A.M.. Mr. Lippert stated that the
government must have been listening to him. If the Vancouver
based Fraser Institute likes this budget then the opposition
Reform and Conservative Parties are obviously taking a long walk
off a short peer as they scramble to take issue with it.
There are other equally vital priorities as well. Canadians
have reported repeatedly to pollsters, the media and to us, their
elected representatives, that there must be an increase in
support for post-secondary education and health care. The
government has responded by increasing the Canada health and
social transfer payments by $2.5 billion. Next year the CHST
cash allotment will reach $15.5 billion, a 25% increase over the
past two years. This infusion brings the federal transfer to the
provinces above the original full funding level. The initially
removed moneys have now been replaced and enhanced. The onus is
now very much on the provinces to ensure that these allocated
moneys become moneys dedicated to the intended purposes.
An editorial last week in the Toronto Star pointed out
that the Ontario government, amidst its constant criticism of the
federal government, has neglected to dedicate the full amount of
$1.5 billion transferred in last year's budget for health care.
The Ontario government has still not utilized $700 million for
health.
While Ontario's share of the new money in this year's budget
will not solve all our problems, distinguished health care
systems analyst, Michael Dechter, stated again this morning that
it would be enough to hire thousands of nurses. We Ontarians
should therefore be looking for significant improvements in our
health care delivery system.
As well, the budget reinforces the government's grasp of the
essentials of research and development and the need for Canada to
excel in all areas of skills, technology and knowledge. The
government created the Canada Foundation for Innovation in 1997
and we continue to make it one of the cornerstones of our plan by
infusing the CFI with an additional $900 million in this budget.
1645
In addition, the creation of the sustainable development
technology fund will foster innovation by helping companies
develop new technologies and bring them to market. In this
regard I exhort Canadian companies to follow our lead and
reconfigure their entrepreneurial spirit which has focused far
too frequently in recent times on the need to cut costs rather
than to develop new products.
Canadian companies have not invested sufficiently in the
development of unique products and processes. As a result Canada
stands 12th worldwide with regard to company operations and
strategies. While Canada sits second only to the U.S. in overall
connectedness, our businesses are not making optimal use of our
connectivity. Canadian CEOs place a greater priority on cost
reduction rather than on capturing markets in every corner of the
globe through e-commerce.
As the Minister of Finance said yesterday in his budget speech,
the private sector must change its concept of risk. This budget
assists them in every facet. It is vital that the private sector
meets the challenges of the 21st century and meets the bar the
government and this budget have set.
I am also delighted that this budget recognizes that our
Canadian forces have endured severe financial restrictions in
recent years. I have promoted the serious need to reinforce the
programs and resources of our forces, and quite frankly the
successful result read in the House yesterday was a victory for
many members of our caucus. This infusion will allow our
military to continue to represent Canada with distinction in our
peacekeeping and peacemaking roles.
Another victory for all of us is the recognition that the
municipalities have an enormous role to play in the ever growing
responsibility of environmental protection. The green municipal
enabling fund helps communities assess where their environmental
needs are the greatest. The budget also creates a revolving
fund, the green municipal investment fund. The administration of
these two funds will be the responsibility of the Federation of
Canadian Municipalities, a highly respected organization. From
this initiative we hope to generate the best approaches to
renewable energy, water conservation, waste management and urban
transit programs.
I have dedicated much of my time since my election to the study
of environmental degradation and the search for remedies. These
initiatives permit immediate implementation of measures that
communities can activate and thus make practical use of the
knowledge, experience and recommendations of the environmental
science and engineering professions.
I am honoured to be an active participant in the Liberal
government and to represent the constituents of
Barrie—Simcoe—Bradford. I am confident that we will continue
to enjoy the support of Canadians so that we can further build on
the frameworks we have structured concerning all these things.
Mr. Ken Epp (Elk Island, Ref.): Madam Speaker, I have
been listening to the Liberal speeches today with a lot of
interest. Obviously Liberal members have bought into the plan,
and I understand that. That is part of their party plan. The
budget has been presented. Many Liberal members I am sure
sincerely support everything in the budget. I suppose all of
them will vote for it. We expect that.
Would the member be so bold as to be really candid with us and
say something about the lack of planning to actually reduce the
debt? The debt is standing at $576.8 billion. The government
has said it will pay $3 billion a year against the debt out of
its contingency fund if at the end of the year it has found no
other way to spend it. In the event that the government actually
does not spend it, that means it will take almost 200 years to
pay off the debt. Meanwhile we are paying $40 billion a year in
interest.
Would the member, in her great candid spirit, tell us what she
thinks and what members of her constituency think with respect to
actual debt repayment and reduction of the interest thereby?
1650
Ms. Aileen Carroll: Madam Speaker, debt reduction has
always been a priority of the government. We have from the
beginning addressed it by a 50:50 approach: 50% on new spending
and 50% on tax reduction and debt reduction. We have helped to
create a economic milieu in the country whereby the economy has
grown. It continues to grow at such a pace that it factors into
the debt ratio. This has declined, as the questioner knows, and
will continue to do so. Yes, we have reduced it by $3 billion
for each of our years. Yes, we continue to set aside a
contingency fund which most likely will be able to be applied to
the debt at the end of this fiscal year.
In phrasing his question the hon. member made reference to the
fact that perhaps members on this side of the House were singing
from a song sheet that someone else prepared. We prepared that
song sheet. We had a finance minister and a cabinet listen
closely to a caucus wherein we are free to speak of all things
vital to us, to reflect what our constituents tell us about
health care, to hear from our constituents and to feed into a
budget. This budget is a result of that. It reflects an open
caucus where every person on this side of the House feels that he
or she has been a part in setting the budget.
The official opposition, to the best of my knowledge, for a
party that wants to be grassroots does not run a caucus in any
way like the caucus of the Liberal government.
[Translation]
Mr. Ghislain Fournier (Manicouagan, BQ): Madam Speaker, it is
often said that the Minister of Finance is a smooth talker, but
his glib words are at our expense, and they will not pay the
bills.
I have been listening to the members opposite all afternoon.
They all agree that they have spent money. That is true—Human
Resources Development Canada has been practically throwing it
out the window, while the Government of Quebec has been
investing it wisely.
After the federal government cut tens of billions of dollars in
health, education, and social programs, the provinces
unanimously demanded $4.5 billion a year. But all they are
getting from the federal government is $2.5 billion over four
years, which boils down to $600 million for Quebec—crumbs.
[English]
Ms. Aileen Carroll: Madam Speaker, it is important to
note that we have restored to 1993 levels and even above federal
contributions to health care. Quebec receives about 28% of total
transfers. That is quite a bit considering that it represents
24% of the population.
As well, we have seen the health minister emphasize the need for
efficiencies. We are back to a large percentage of the funding
of health, but there is a need for all provinces to come together
to make a more efficient system. It requires all their input.
Mr. John Solomon (Regina—Lumsden—Lake Centre, NDP):
Madam Speaker, I will be sharing my time with the member for
Winnipeg North Centre and I will take 10 minutes to make my
remarks regarding the budget.
When I look at the budget I try to measure and gauge it with
respect to where it sits in terms of the priorities of my
constituents. As a matter of fact I undertook to poll my
constituents and I did so in January. I sent them all letters
and asked them to priorize where they would put the surplus for
this fiscal year. I want to share with the members of the House
exactly what my constituents told me and asked me to tell the
government with respect to priorities, which my party and I did.
There is one thing almost everyone in my constituency agrees on:
the restoration of federal health care funding.
Eighty-three per cent of them indicated that they wanted health
and education transfers restored and for the government to make
up for the losses.
1655
The Liberals talk about restoring to 1993 levels. They have
taken $600 million out of health care funding in my province of
Saskatchewan in the last five years and have restored it by $18
million this year. We are short $582 million, yet they are
saying that it is as big as it was in 1993. They neglected to
tell Canadians that since 1993 the population of Canada has
increased by about one or two million people. I am not sure of
the exact number, but over one million people, to be safe, and
they have cut back in terms of health care.
The number one issue in terms of measuring the budget with my
constituents' priorities is that it fails the test of what they
believe is the highest priority of our national government with
respect to this important social program.
As the number two priority my constituents also wanted to see
money for a long term farm aid program until such time as the
international subsidy war was dealt with at the WTO. I look in
the budget and what do I see? There is not one dime for
agriculture in terms of a long term program. We see a short
term, inadequate amount of $180 million. We in Saskatchewan are
grateful for that, but meanwhile the treasuries of France, Spain,
Great Britain, Germany and the United States of America keep
subsidizing their farmers to the full extent. Thereby western
grain farmers are at a disadvantage being at the lower end of an
uneven playing field. They are finding it very difficult to
compete as a result of the prices being driven down.
The third most important item to my constituents was a personal
income tax cut. Sixty-eight per cent believe they should have a
GST cut of one point or a modest decrease in their personal
income tax. The budget addressed the personal income tax cut. I
think that will be a very positive step in the long haul. One
out of three is not bad, although my constituents wanted
something a little more substantial in terms of the GST.
Fourth, 66% of my constituents polled believe that we should
have some kind of additional significant program to the tune of
over $2 billion to address child poverty. We see in the budget a
modest attempt to do so, but neither my constituents nor I think
it goes far enough. There is a big gap in terms of differences
in our priorities.
Most important, we sent out thousands of questionnaires and had
almost 1,000 returns, which was not bad for a mail-back. Not one
constituent indicated that we should further subsidize the NHL.
Yet the Liberal government in the first week in January announced
a big subsidy program for NHL hockey players. I wonder what its
priorities are. I see the Minister of Industry is in the House.
I can understand the pressure applied to him from the local
hockey team and the local supporters, but surely there must have
been some sense in the budget of the priorities of Canadians
before this was undertaken.
I do not want to talk only about my constituents' priorities and
how they differ from those of the government. I want to try to
measure the budget from a fair perspective. How do we measure
whether or not a budget is fair? I confer with my constituents,
which I have done, and in their view they do not believe this is
a fair budget with respect to western Canada.
The real test of whether the budget is fair is whether it is
providing some progress for Canada. The true test of progress is
not in our country. It is not whether we add to the abundance of
those who have much but whether we as a government, we as a
country, provide enough for those who have too little. Under
this test the budget does not pass. It does not provide
substantial support in terms of tax cuts, child poverty programs
or health care financing to help those who have too little, but
it will provide huge tax cuts for the very wealthy.
In this current fiscal year the Liberals gave millionaire hockey
players a $16,000 tax cut.
They gave Canadians zero in this fiscal year. The next fiscal
year which is the budget we are speaking on, they are going to
give the hockey players another $9,000 or $10,000 on top the
$16,000.
1700
The millionaire hockey players in this country will now have a
two year tax break of about $26,000. What do we get as average
Canadians? What do average Saskatchewan residents get? They may
get $250 a year, 20 bucks a month. That will not not buy a daily
cup of coffee.
In my view health care has been put on the wait list. Education
has been put on the wait list. We have letters from the
Saskatchewan school trustees saying that this is an inadequate
budget.
The president of SSTA, Gary Shaddock, in expressing his
disappointment to the Minister of Finance said, “This was
supposed to be the children's budget. Several things outlined in
the budget are positive for families but the budget did not do
enough to address the national children's agenda and provide a
strategy of how Canadians will support their children in the
future”. For somebody from the SSTA who is a very responsible
parent, a very responsible citizen of this country, to say this
about the budget in a non-political fashion in my view condemns
this budget even further than what we have already outlined.
Agriculture is on the wait list. We have tax cuts in terms of
personal income tax cuts. There is some progress there, but in
this calendar year it is basically the wait list for Canadians
with small and average size incomes.
We have seen no action in this budget on defending our economy
with respect to energy prices. I have stood in the House a
number of times since the House resumed in February to ask the
government what action plan it has to defend our economy and to
defend Canadian consumers from international price gouging by the
refiners and other vertically integrated oil companies. There is
nothing in this budget.
Regarding highways, in Saskatchewan this government takes out
about $180 million a year in excise taxes. What was put back in
this budget for highways? Not $180 million, not even $100
million, not even $5 million. Not one cent in this budget has
gone to highways in Saskatchewan after the government has taken
away the transportation subsidies. The roads in our province have
declined and deteriorated in an accelerated fashion and there is
not one dime.
It is getting to the point where we need a government with some
kind of conscience. We need a government that believes in having
a balance to the economic powers that run our economy. The fact
is the very wealthy corporations and the very wealthy families
run the country's economy. It is the government's obligation,
duty and responsibility to be the balance to those powers that
run the economy. One of my constituents said, “Leave the rich
alone in this budget and help out the rest of the country”.
I believe very strongly that this government has failed in its
test. It has wait-listed seniors. There is no substantial
support for seniors in their very severe challenges with respect
to inflation. It has wait-listed education and health care. It
has wait-listed tax cuts. It has wait-listed agriculture. It
has wait-listed an energy plan to defend our economy. It has
wait-listed any kind of national highway program.
My view and the NDP's view is that the government has failed
with the most incredibly poor budget we have ever seen in this
country. It does not help people. It helps the very rich and
the very wealthy families and corporations. As a result, I can
assure every one of my constituents who have written to me that I
will stand in the House and I will vote against the budget. I
think it is the wrong budget for Canadians and for western Canada
in particular.
Mr. Roy Cullen (Parliamentary Secretary to Minister of
Finance, Lib.): Madam Speaker, I could speak to many of the
items the member Regina—Lumsden—Lake Centre commented on.
Regarding the federal transfers, as I said earlier the federal
transfers have gone from $37.4 billion in 1993-94 to $38.6
billion in this year alone. We are back to the days of the 1993
transfers.
With respect to Saskatchewan, in 2000-01 the federal transfers
to Saskatchewan will exceed $1.2 billion. They will account for
about 22% of the Saskatchewan government's estimated revenues.
They will equate to about $1,174 per person and over the next
five years will total about $6.3 billion. I think that is pretty
fair.
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With respect to the income tax cuts, the member should check the
budget closely because it is targeted to middle and low income
Canadians. For example, a one earner family of four with an
income of under $35,000 will receive more in benefits than it
pays in the year 2004. I could go on and on.
There is the agricultural aid. We can all empathize with the
plight of the farmers on the prairies but in the last three or
four budgets we have put in over $2 billion and $240 million was
announced recently.
The member should be more candid and fair in his critique of the
budget.
Would the member comment on the increase in the Canada child tax
benefit which will increase to $9 billion a year? Will that not
help children?
Mr. John Solomon: Madam Speaker, I would like to point
out the facts exactly as the member has asked me to do.
The Liberal government has taken $30 billion out of health care
since 1994 and this year it is putting $1 billion back in. For
every 30 bucks it has cut, it is putting one dollar back. And
the Liberals call that reinstating funding for health care. That
is appreciated. I guess $1 billion is better than no billions
but the government has cut $30 billion in terms of the total
losses to health care in the last five years.
Saskatchewan receives a little over $1 billion in all the
various transfer payments. The question I would ask the member
is how many billions does the government take out in terms of
income taxes, licences, GST and other fees for the federal
treasury? I can say it is a heck of a lot more than $1 billion.
It is billions more than $1 billion. We are sharing that with
the rest of the country. We are happy to do that and we are
getting some of it back but not all of it, so let us call a spade
a spade.
There is a debt in the country. Every single Canadian, whether
born this minute or 79 years old, is paying $1,400 a year in
interest on the Liberal-Conservative-Reform debt. A family of
four is paying $5,600 for the Liberal-Conservative-Reform debt
and the Liberals are giving a $250 a year tax cut. Are they
crazy? I think they are. It is ridiculous.
We have to look at the budget. I give the Liberals credit. They
are masters at doing and saying things to make people feel good.
There may not be any kind of substance to their actions but they
can do their spinning and promoting. They have 155 MPs and
hundreds of millions of dollars as we found out during the last
month, to do those sorts of things, to make people feel good
about things that they are supposed to be doing, might be doing
or may want people to believe they are doing. On every occasion
it is a feel good approach. There is never any substance to
address the hard core issues facing Canadians.
The final point the member raised was with respect to
agriculture. Yes, they have paid $2 billion with provincial
shares into agriculture in the last two or three years.
Saskatchewan out of $2 billion may have received about $400
million or $500 million. The vast majority went to Ontario,
Quebec and Atlantic Canada.
My final response to the member's question is that the
government has done a good job for farmers in Ontario. I see my
colleagues from the rural Liberal caucus in Ontario. They have
done a good job getting money for their farmers but they have
failed to address the western agricultural issues and that is
where we are falling down in western Canada. They should provide
more money to farmers, whether they are in Ontario, Quebec, or
western Canada. The government needs to address the huge issue of
the restructuring of agriculture in western Canada as soon as
possible.
Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP):
Madam Speaker, I am pleased to share this time with the member
for Regina—Lumsden—Lake Centre and put on record our concerns
with the budget.
1710
We have heard a lot today from Liberal members about the
opposition getting in touch with reality. I would suggest that
members across the way on the Liberal benches should stop and
think just what this budget means in terms of the priorities of
Canadians.
If they take a moment to study the facts and determine what the
reality is, they will hang their heads in shame. Yesterday a lot
of folks gathered here. They represented all kinds of
organizations, particularly those in the health care field.
People advocating for patients were here. People representing
nurses and doctors were here. Ordinary citizens were here
waiting with bated breath to hear what this government would say
and do about their number one priority, health care.
The reaction in this building in the circles of folks gathered
together to witness this government's response on that important
issue was like being at a funeral. It was like a wake. People
were devastated. One cannot imagine the sense of disappointment
that was felt yesterday and which continues today.
People believed that at least the government would take their
concerns seriously when it came to health care. They truly
believed there would be something significant on health care in
the budget. One cannot imagine the dismay, disappointment, fear
and worry among those folks gathered here and all across the
country when they learned that the response by this government on
health care was to put in a one time short term allocation of
funding to be shared by health and education, and maybe even
other social programs if one reads the budget carefully, over
four years. My leader was absolutely right in saying that the
government is prepared to give two cents for every dollar in tax
relief. It is a 2% solution when this country has a health care
crisis.
There was that disappointment yesterday and today that concern
is reflected in every media outlet. There is without exception
nothing but absolute opposit