Mr. Raj Grewal (Brampton East, Lib.):
Mr. Speaker, it is an honour to rise in this House to speak to the government's second budget, entitled “Building the Middle Class”.
My constituents elected me to serve as part of a government that will help the middle class and those working hard to join it. To be able to represent these priorities of the residents of Brampton East in this House is a privilege.
I am lucky to be a member of the Standing Committee on Finance, which has kept me quite busy thus far. Recently the finance committee concluded a study on tax fairness for all Canadians. It studied tax evasion and tax avoidance. The committee's report contains 14 recommendation for the government on topics such as conducting a review of the voluntary disclosures program and requiring all tax advisers to register their tax products with the CRA.
I am proud to share that in response to the finance committee's recommendations, the government affirmed its support for all 14 recommendations. Additionally, the government shared the work that has already been done or is currently being undertaken to ensure all Canadians pay their fair share of taxes to our great nation.
Paying our fair share of taxes is an essential part of financing measures that enhance all Canadians' quality of life. When certain individuals and companies find ways to cheat the system, it is the middle class that usually picks up the tab. That is totally unacceptable and counterproductive to our country's goals. That is why making the tax system more fair is an ongoing priority of our government.
In support of this objective, budget 2017 proposes to invest additional resources to combat tax evasion and aggressive tax avoidance. Budget 2017 also proposes legislative changes to the tax rules. These changes would close tax loopholes that result in unfair tax advantages for some at the expense of others, invest additional resources to crack down on tax evasion and combat tax avoidance, make existing tax relief for individuals and families more effective and acceptable, eliminate ineffective and inefficient tax measures, and provide greater consistency in the operation of tax rules.
Going forward, we will continue to eliminate poorly targeted and inefficient tax measures and make our tax system more fair and efficient. The government is committed to taking these steps because we know and understand that fairness is essential to ensuring Canadians have confidence in their tax system.
Last year in budget 2016, our government committed to undertake a wide-ranging review of increasingly complex tax expenditures that now exist. This review of federal tax expenditures has highlighted a number of issues regarding tax planning strategies using private corporations, which can result in high-income individuals getting unfair tax advantages. A variety of tax reduction strategies are available to these individuals that are not available to other Canadians. An example of such a strategy is the use of private corporations to reduce taxes through sprinkling income to family members.
Budget 2017 sends a strong signal that the government is taking action to ensure that high-income individuals cannot use strategies involving private corporations to gain unfair tax advantages. The government will release a paper in the coming months setting out the nature of these issues as well as proposed policy responses. In addressing these issues, the government will ensure that corporations that contribute to job creation and economic growth by actively investing in their businesses continue to benefit from a highly competitive tax regime.
A fair tax system requires constant attention. Ongoing legislative adjustments are needed to ensure that rules are functioning as intended, and they do not result in some taxpayers paying less than their fair share, for example, through complicated tax planning arrangements.
To ensure the tax system operates as fairly and effectively as possible moving forward, the government will continue to study, identify, and address tax loopholes and tax planning schemes. Tax evasion and avoidance is unfair to the vast majority of Canadian individuals and businesses that play by the rules.
The measures in budget 2017 will build on previous investments to support the Canada Revenue Agency in its continued efforts to crack down on tax evasion and tax avoidance. To do this, the CRA is increasing its verification activities, hiring additional auditors and specialists with a focus on the underground economy, developing robust business intelligence infrastructure and risk assessment systems, and improving the quality of investigative work that targets criminal tax evaders.
Budget 2017 will invest an additional $523 million over five years to support these efforts. As CRA has a proven track record of meeting expectations from targeted tax compliance, budget 2017 accounts for the expected additional revenue of $2.5 billion over five years from these measures that crack down on tax evasion and combat tax avoidance.
We know that in a globalized world it is not enough to simply concentrate our efforts here at home. We need to have an international focus as well. To this end, Canada is part of a coordinated international effort to address what is known as base erosion and profit sharing or BEPS. BEPS refers to tax planning arrangements used by multinational enterprises to unfairly minimize their taxes. Canada has implemented, or is in the process of implementing, agreed international standards under the BEPS project.
This includes recently enacted legislation which requires large multinational enterprises to provide information about the international distribution of their activities. This information will enable tax authorities to better assess tax avoidance risks. We will continue to work with our international partners to ensure a coherent and consistent response in fighting tax avoidance through BEPS.
Over the past year, we have worked to build a fairer tax system that benefits the middle class. Our review of tax measures identified opportunities that make existing tax measures more effective, equitable, and accessible to all Canadians. Specifically, budget 2017 proposes to simplify and improve existing tax measures for caregivers, persons with disabilities, and students.
Right now, Canadians who are caring for loved ones face a caregiver credit system that is complex and difficult for families to navigate, so we have simplified it by introducing the Canada caregiver credit. This new non-refundable credit will provide greater support to those who need it the most and will apply to caregivers whether or not they live with the family member who is receiving the care. This measure will provide $310 million in additional tax relief over the 2016-17 to 2021-22 period and will support families struggling to take care of loved ones.
Canada is a country founded on the belief that with hard work comes success and that with success comes a responsibility to help others. Canadians share the understanding that success as a nation is only as great as the success of our most vulnerable. They know that challenging the barriers that persist is a necessary part of moving our country forward.
Budget 2017 takes the next step in the government's long-term economic plan, understanding that in the face of unprecedented change, a confident Canadian middle class will always be the beating heart of our country and the engine of our economy.
Hon. Kevin Sorenson (Battle River—Crowfoot, CPC):
Mr. Speaker, it is always an honour to stand in the House and debate the issues that governments and Canadians face, and that Canadians have to deal with.
There was great anticipation about the budget around the country. People were looking forward to a second fiscal strategy put forward by a government that failed, most people would say, with the first one. When we look at the growth rate, the job numbers, and all those, certainly there was failure. There was a hope: I think an expectancy among Canadians that they would see something in the budget that would give them a degree of optimism and hope.
We know some of the problems Canadians are facing. They are facing high household debt. Their hope was that perhaps there would be something in the budget that would help in that regard. We know they are facing skills and training deficiencies, and perhaps there would be something in that regard. We know that Canadians are not saving to the degree they should be, and perhaps there would be something in the budget that would help them. The day after the presentation of the budget, I think all of us would agree there is great disappointment out there. For Canadians, there is no increased hope, no increased optimism, and no increased drive because of things they find in the budget.
What do we know about the budget? We know there is a $23 billion deficit from last year. It was originally projected to be higher, but because the Liberals were unable to get much of their money out of the door, it is a little lower. We know the budget is again written in red ink. It takes Canadians deeper and deeper into national debt. It will increase our debt service charges. It will increase revenues that will go only to service debt, which the government continues to pile up.
Being involved somewhat in former budgets, I can say that we put in place strategies to bring us back to balanced budgets. When the world went into a global recession, Canada was the last to enter into that recession and we were the first to leave it. Why was that? It was because we had a strategy to come back to balanced budget. We understood the importance of keeping our economic house in order, of taking fiscal responsibility for our country. We understood that Canadians expected that of us.
It seems that, even with this budget, Liberals do not seem to care if the federal books are balanced anytime soon. They have gone beyond “budgets will balance themselves”, a quote our Prime Minister gave Canadians, to a frame of mind that is not even concerned about the debts that are being amassed and left to our children and grandchildren to pay off.
I want to be clear. In our 10 years in government, in the first two years we paid down national debt. We took surpluses and paid down just under $40 billion to our national debt. When the entire world went into the worst downturn and recession since the Great Depression, many countries were in massive trouble. We saw that their currency was failing, that their banks were failing, and that their whole plans were failing. We know about Greece and many of those countries, like Iceland and others. There were massive problems. However, Canadians knew they had people at the rudder who understood economies and knew what they had to do.
Although we were opposed to debt and deficit spending, we realized that in the worst recession since the Great Depression we would invest to kick-start the economy, and we did, as every G7 country did. We make no apologies for that. The largest infrastructure spending, the largest infrastructure program in Canadian history, was brought forward by a Conservative government to kick-start the economy. Therefore, the question should be asked, and it is fair to ask because we will ask it of the Liberals. Did that strategy work? The answer is obviously an unequivocal yes. It did work.
We saw that Canada was the first to leave that recession. Out of all the G7 countries, Canada was the very first to leave that recession and come back to growth. We saw that those investments were in long-term infrastructure that would be around for decades, that would help grow economies, and it worked. We know that we came back to our surplus and balanced budget, as we had promised. In fact, some would say it was a year earlier than we had promised. We paid down that $40 billion and went on to watch our economy grow.
I listen to questions being posed by Liberals here, and many of them are new, as the Liberals had 30 seats before and they have 160 now. The Liberals have a majority government, but many of them are first-time MPs. They say we ran up a big deficit; we ran up debt. The answer is yes, we did, but we had the plan to come back.
The Liberals had a plan to come back. They spent, went into deficit and massive debt, but they had a plan to be back to a balanced budget in 2019. However, now our parliamentary budget officer is saying that it is going to be 2030 or 2035. It will be 30 years down the road before we see any kind of plan that can feasibly bring us back to balanced budgets.
We cannot do that. We cannot fall into that trap. We cannot become a country that has that type of massive debt, and we must do what we can. I think in the next election, the very first main plank in coming back to balanced budgets will happen, and I am very optimistic going into that.
On jobs, our focus as a government during the recession was how we would hold on to the jobs we had and how we would create new ones. We invested in innovation and skills development. We invested in making sure we had the best labour force in the world.
However, we did something more than that. We said we had to make sure our tax regime was such that we could be competitive around the world, first of all. We need to sell our goods into a global market, and we have to be certain that we could be competitive. There is no use trying to have a job, make a gadget, and try to sell it if it was be so over-priced that nobody would be willing to buy it. Therefore, we made sure that our taxes kept going down. In fact, we lowered our taxes more than 160 times. We had the lowest tax rate among the G7 countries. Bloomberg said that we were the second best place in the world to do business. That is why we came out of the recession early.
We sat down with employers and business and asked what it would take to have them hold the jobs they had or create new ones. They were very clear. They said not to do things like raise payroll taxes or increase their level of taxation. Therefore, with what I thought was agreement of all parties, we said we would lower the small business tax rate from 12% to 11%, and we did, and then from 11% to 9% phased in over three or four years. We were committed to that. In fact, all parties were committed to that. However, right after the current Liberal government was elected, it made sure that was one promise it would not keep. The Liberals would say to our small business sector, “Why would we ever lower taxes?”
We consulted with Canadians. We consulted with businesses. We hoped to save jobs and secure economic growth during that difficult time. This is why we incurred budgetary deficits. It is also why we created opportunities for young Canadians and saved jobs during an economic recession.
There was a very fragile economic recovery that followed the recession around the world. Too many nations had a difficult time recovering from the recession. It was painfully slow. However, our government immediately pursued getting back to balanced budgets, showing Canadians and the world confidence in our dollar, showing Canadians and the world that we were getting our fiscal house in order, and our dollar reflected that.
Canadians understood that the difficult economic times were over. By 2015, we had brought forward a surplus in the federal budget. Canada was ready to confront another global crisis.
Governments normally only go into deficit if there is a crisis confronting their nation. Governments with budgetary surpluses or balanced budgets have the ability to combat something new. I really fear that with the level of debt we are seeing the Liberal government piling on Canadians, we would not have the capacity to react effectively if there is another massive crisis or global downturn.
In the last budget, the Liberal government said it would be investing in infrastructure. I think all Canadians know the story. During the election the Liberals promised that there would be an itsy-bitsy deficit of $10 billion. The Prime Minister said, “We can do a lot with $10 billion. It sounds big, but we can do a lot with $10 billion.” Then when he came to power, we found that the $10 billion had grown to nearly $30 billion. That was the concern then.
That money was supposed to raise growth. It was also supposed to get the jobs market and the building sector going. It has been a failure all around. The government has had a hard time getting the money out, and the growth has not been there. In fact, there has been less growth. Growth is happening in the United States and all around the world, but it is certainly not happening very quickly here in Canada, in spite of all the measures that the Liberals took in their 2016 budget.
Why would Canadians have hope in this budget? What is in the budget that they could find some hope in? Well, we can listen to the media. I am not one to encourage people to do that too often, but even the media recognize that the budget is probably one of the weakest budgets ever. I spoke to a former Liberal member of Parliament yesterday; he said that this is the most nondescript budget that he has ever seen. That was coming from the Liberals' own benches.
Where should Canada be? Canada should be in its third year of budgetary surplus. This year the Government of Canada should have a surplus of tax dollars to spend without borrowing. The interest payments on Canada's national debt should be decreasing, but the budget book shows us that the interest Canada will have to pay is increasing. We know that when we service debt to the degree that the Liberals will have to service debt down the road, that money is not going to go anywhere else. That money is not going to social programs. That money is not going back into education or health care. The Liberals seem to feel that they will just print more money or that they will just go deeper into deficit.
There are consequences to the actions we take. I warn the Liberal government that there are massive consequences to not having a plan to come back to balanced budgets. There are consequences to increasing deficits and national debt. This generation may not face those consequences, but for our children and grandchildren it will be difficult.
The 42nd Parliament should be in a position now to pay down Canada's national debt. Instead, the Liberals are not spending money to create jobs or grow Canada's economy. They are actually adding to the national debt instead of paying it down. They are leaving their debt for future generations.
The Liberal government has even failed to achieve the economic and employment objectives presented in its last year's budget. Budget 2017 needed to include no further tax hikes on Canadian families, businesses, seniors, or students, but instead needed immediate measures to encourage companies to hire young Canadians and to address the youth unemployment crisis. It should have included a credible plan to return to a balanced budget by 2019, as promised to Canadians. This budget has failed Canadians. The Liberals have failed Canadians with their second budget. There are no new job creation incentives. There are only more education opportunities.
Young students I know are coming out universities and colleges hoping for a job, but the government says, “We'll see if we can get you to take more education after that.”
There is no plan to balance the budget.
According to the parliamentary budget officer, budget 2016 did not meet employment targets because infrastructure investments were delayed, and there were many other reasons. The Liberals get an F. They get an A for announcements, always—Liberals are great at that—but when it comes to delivery, they are looking at a D or an F, because Canadians end up paying the costs.
In Alberta, the new Building Canada funding that was promised to municipalities was withheld by the NDP provincial government. Five rural municipalities have been told to wait or have been left behind altogether. I will even give it to the Liberals in that I think when they sent that infrastructure money to the province, they expected the province would send it out to where the priorities were, but the provincial NDP party said, “No, we're putting it into our general revenues, and then we will pick the priorities sometime down the road.” I think even the Liberals would shake their heads at that one.
No wonder there is no growth. No wonder there is no incentive. No wonder there are no kick-starts in Alberta. The province has the latitude to use the large majority of those infrastructure dollars as it sees fit, but the funds did not go where they were expected to go. It is a massive loss of opportunity for those municipalities, and in some cases the rural municipalities seem to be having the majority of the problems in that respect.
The Liberals also failed to grow the economy with their budget. The economy grew by 1.4% in 2016, which is 0.5% lower than what they had anticipated and claimed it would be in their 2016 budget. They believed it would grow by over 1.8%. They would kick all this money into it and see this massive growth. The previous Conservative government had economic growth of 1.8%, so the Liberals thought they could at least count on that with these extra massive spending measures. When we were investing in infrastructure, the Liberals claimed that we were not investing enough, that we were not spending enough money. They spent a lot more and they realized a lot less growth in the economy. They got less bang for the buck. They had less success. They had lower results. That is the record of the Liberal government.
What did the Liberals do with the $30 billion? What did they accomplish? Well, it is not in jobs and it is not in new revenues coming in.
I want to conclude with two things.
First, I want to talk a bit about our neighbours to the south, the United States. I want to talk about our relationship with them. I think the Liberals backed off on a lot of measures and I think they would have put it to Canadians even more than they have with this budget if it were not for the Trump administration and the knowledge that the U.S. is going to very quickly lower its corporate tax rate.
When we came into power, we lowered our corporate tax rate from 22% to 15%. That created jobs. Our business sector said, “We will create jobs”, and it did, coming out of that recession. Now the Americans are talking about taking it down from 35% to 15%.
We need to be very concerned about businesses making the trip back to the United States, businesses settling down again in the United States. We need to have a plan.
When we lowered that tax rate, we saw head offices and companies, especially in manufacturing, coming into Ontario and across Canada. We need to be cautious. The Americans are here and they are going to compete, and we need to be certain that we are competing at an equal level. We cannot compete at an equal level if we continue to raise the tax burden on them. We cannot increase our manufacturing sector and our business sector if we increase EI and CPP and say, “Here are some extra taxes for you to pay.” Then there is the carbon tax and things like that.
The Americans are competitive. We had better be competitive. The Liberal government's budget nickels-and-dimes Canadians, but it really hits business.
Mr. Speaker, I see my time is up. I thank you for the opportunity to speak, and I look forward to some questions.
Hon. Hedy Fry (Vancouver Centre, Lib.):
Mr. Speaker, I rise today proudly to support this budget. I think it is everything one would expect of a good Liberal budget. In 2016, the budget looked at how we would help the middle class and those hoping to join it get more money in their pockets. The child benefit and the lowering of taxes for the middle class facilitated that. If we look at the data a year later, we find that there was an increase in spending on household items and in general retail spending. It achieved what it wanted to achieve.
Budget 2017 is focusing on jobs, focusing on how people in the middle class can get good, solid, permanent, well-paying jobs and how industry and sectors that create jobs can actually create more of those permanent, well-paying jobs for people to get. This is a budget that builds on the last budget. This is a budget that says that here is how we move people into that place where they get such jobs.
We know it is not enough just to say that we want to create new jobs. We know that government in itself does not create new jobs. However, we can create a climate. We can foster and give initiatives to businesses and industries to create jobs. We know that in Canada we have good education and good workers who are intelligent and understand the issues. We need to move into the new sectors of work, the global economy. We know that innovation is where we are going to get Canadian citizens to find jobs.
In speaking to that, we also needed to look at a gendered budget. How do women fare in this new world of work? How are women going to get opportunities? We saw with infrastructure that only 2% of women work in infrastructure projects and construction. We know the reason they do not. They have told us over and over that this kind of work needs flexibility. It needs the ability to sometimes spend long hours working, and sometimes not working because of the weather. Therefore, being able to put $7 billion over 10 years into fostering not just child care but good learning and development for children for the next generation is the most important thing we can do in helping women get into the workforce and the well-paying permanent jobs we are talking about.
By the way, l am just reminded that I am splitting my time with the member for Vaughan—Woodbridge.
It is not only child care. It is looking at how we can help families adjust to the world of work so that they can be more flexible. It is allowing women who are pregnant to have another four weeks of maternity leave if they choose, and I add that everything is if they choose, and also ensuring that we move from 12 months to 18 months of parental leave that is flexible. Parents can decide who wants to stay at home and who wants to balance that world of paid work and that world of helping to raise their children. We have set a standard kind of formula for people to make a decision on how they do that.
The second part of getting people to work is to create ways in which people can have access to skills training and post-secondary education. It is to facilitate a clear way of getting adults who are already in the workforce but only have part-time work and are not in that world of good-paying jobs to go back to university. We are suggesting student grants that would let people who are working part-time get access to that kind of training.
We also know that EI has been changed so that if people are working in particular jobs, but they are not long well-paid jobs, they may be able to get training at the same time they are working on that older job.
We are also looking at how student loans can become a flat-rate student loan system. In the old days, people could not qualify if they owned a home or if they were working part time. We are now saying that if people own a home and are working part time and have children, they can have access to an expanded flat-rate student loan program. This is about getting people into the workforce.
Now we have to talk about how to get those jobs created. Helping industry and businesses move into this new world of work is something we are going to do.
We are talking about innovation in areas in which Canada already has a strong reputation in those sectors. We are focusing on five sectors. This is not the end of it. We are starting by focusing in areas.
There is agrifood. This is good news for my province of British Columbia. We are looking at advanced manufacturing, which is good news for people in Ontario and in Quebec.
We are also looking at clusters in biotech and health sciences. British Columbia biotech and health sciences are creating clusters and hubs of new innovation in health sciences. Of course, we are looking at pharmaceuticals and creating hubs for delivering that. We have Triumf in British Columbia. All these groups are going to benefit in creating these new kinds of jobs.
There is also clean tech. The Minister of Innovation, Science and Economic Development recently came to British Columbia. British Columbia has only about 13% of the Canadian population, but we are creating 33% of the high-tech jobs. Helping us to move forward into those areas, looking at innovation and clean technology, will not only benefit my province but every province.
One thing that has always been a priority for British Columbia is housing. Housing prices are going beyond anyone being able to afford a home. By putting what I consider to be a good amount of money in these areas, the federal government is getting back in to national housing, working with provinces and territories, municipalities, NGOs, groups that create housing, the private sector, and other areas where housing is being created. However, we know we cannot do everything in one, two, or even three years. What the minister heard when he did his consultation on national housing, was that we should focus on the most vulnerable.
The budget will do exactly what the minister heard. It focuses on seniors, on mental health and addictions, veterans, and housing for aboriginal people. We have a huge urban aboriginal population in the city of Vancouver. The west also has a huge urban aboriginal population, as well as on reserve, that need access to good housing.
We are also back again to this gendered budget, in which we say that a lot of women fleeing violence are going to be on that list of priorities.
We also recognize that we cannot make good public policy unless we have good data. We are putting $40 million in to Statistics Canada to develop to a housing statistic framework to look at how we get data and not just perception, perception that says foreign buyers are driving the prices up, etc. We need good data to find out who is doing what, where, when, and what is needed, how mortgages are affecting first-time buyers.
Then we are looking at that full spectrum of housing by putting in extra money. We are expanding the homelessness framework, with $2.1 billion. We are looking at the full spectrum of needs, from homelessness to SROs, which are single room occupancies, to affordable rental housing, which at the moment is where the bottleneck occurs. Being able to help young people and first-time buyers to buy a little starter home, working with CMHC and core housing is the kind of spectrum and partnerships we are building in creating housing.
How does housing help? Housing is a human right, the ability for a family to have a safe place to bring up their kids, an ability for those kids when they grow up to get a good education and skills training. We are looking at that whole continuum of how we help Canadians achieve the kinds of opportunities they need to fulfill their potential, to get work, to find good jobs, to spend money, which helps the economy. We are looking at how businesses in this new world of work actually get that work to the people.
I am so proud of the budget. On transit and getting people to and from work, the Broadway line that will be built in my riding and extended into Vancouver Quadra is great news. Our mayor has already issued a press release saying how pleased he is with some things in the budget, which will fulfill the needs of the people in Vancouver, and the needs of other mayors and people in British Columbia.
This budget not only serves British Columbia well, it not only serves the city of Vancouver well, it serves the whole country well. I am proud of this good, well-thought-out, comprehensive Liberal budget.
Mr. Francesco Sorbara (Vaughan—Woodbridge, Lib.):
Mr. Speaker, it gives me great pleasure today to rise to speak to budget 2017. This budget is the next step in our government's focus to ensure a brighter future for all Canadians with what I call a three-pronged approach: a focus on innovation, infrastructure, and skills training. This budget deals with the global realities and certainties that Canada faces, but meets head on the exciting opportunities that we as a nation must grab hold of, and charts a course in which Canadians can be proud and confident.
As someone who spent over two decades working in the global financial markets of New York City, London, and Toronto, I can state with expertise that budget 2017 is fiscally responsible and undertakes strategic investments that will strengthen and grow Canada's middle class, while taking the responsible approach to fiscal management, cemented in a stable and declining debt-to-GDP ratio. Canada's fiscal strength rests on its load-debt burden, and protecting this source of strength is of paramount importance.
On a personal level, as a father of two young daughters, Natalia and Eliana, this budget is not just a plan for the future of this generation but of successive generations. I know budget 2017 will make a positive difference in the lives of the residents I have the privilege of serving in the dynamic and growing riding of Vaughan—Woodbridge.
Earlier this year, I announced a multi-million dollar investment in a new inter-regional transit terminal in the city of Vaughan, which will connect with the Toronto-York Spadina subway extension project, due to be up and running in later 2017. This investment by our government, in partnership with the other levels of government, will benefit not only my community but all communities in York Region and the GTA. As I like to say, a better place to live, learn, and work.
We have already begun to see the green shoots in the Canadian economy, including a labour market characterized by having the strongest job growth since 2012, spending by consumers supported by gains in disposable income and the Canada Child benefit, and a robust housing market, that are attributed to budget 2016. The transformational Canada child benefit will provide over $20 billion of direct tax-free payments to Canadian families this year.
Strategic investments in infrastructure, the lowering of taxes for over nine million middle-class Canadians, and pursuing trade policies that saw Canada complete a progressive and standard-setting agreement with the European Union are all providing a solid foundation for a brighter economic future for all Canadians for years to come.
Let us examine the specific measures in budget 2017 that focus on what I called our three-pronged approach: innovation, infrastructure, and skills training. In our fall 2016 economic statement, the government announced that it would invest $81 billion in infrastructure for the next 11 years. I am proud to announce that within budget 2017, we see those details. This will include nearly $21 billion to support social infrastructure in Canadian communities, including $7 billion over 10 years to support and create more high-quality, affordable child care spaces across Canada.
I wish to highlight this specific investment in Canadian families with a quote from Marni Flaherty, chair of the Canadian Child Care Federation, as follows:
|| We are pleased that Canada’s federal government has taken this significant first step in committing to a multi-year funding plan. Moving forward, creating fundamental changes in how Canada supports the middle class – and all families – in accessing high quality and affordable child care will require increased funding, planning and coordination.
Over $11 billion will be invested over 11 years for an inclusive national housing strategy. There will be $1.8 billion invested over 10 years for cultural and recreational infrastructure. An additional $10.1 billion will be invested in trade and transportation projects from coast to coast to coast. We need to get our goods and services to market to export and we need to break down bottlenecks.
I applaud the strategic investment of $152 million to provide consistent and effective security screening of travellers and workers. Air Canada commented as follows:
|| Air Canada today said it welcomes funding in the Federal Budget that will improve airport security screening processes at Canadian airports. This will benefit travellers by reducing wait times and should enhance the overall travel experience.
Airports are key economic drivers with, for example, in Toronto, GTAA, a key economic cluster as the second largest employment zone in the country.
Canada also faces a rapidly changing global economy and for us to succeed, we must foster citizens to be global leaders in their fields and have our creative and entrepreneurial citizens propel the economy forward. Our plan on innovation and skills training meets this challenge and will position our citizens and companies to succeed not only at home but also on the global stage.
Budget 2017 contains a number of measures on innovation. We all know that Canada is positioned for innovation with the most highly skilled and educated workforce and one of the best places for openness in trade and investment.
Briefly, there are three I wish to highlight, which will help companies scale up and identify those with the greatest potential. These measures include establishing Innovation Canada, a new single window at Innovation, Science and Economic Development Canada for business innovation programming to help coordinate and simplify innovation programs. Second, $950 million will be invested over five years to support business-led innovation superclusters that have the greatest potential to accelerate economic growth, and up to $400 million will be invested in the Business Development Bank for a new venture capital catalyst initiative.
I am proud of our commitment and the compassion we demonstrated for Canadian families. Our commitment to Canadian families is steadfast. We understand that Canadians face a job market that requires lifelong learning, and we are there to help. As an old proverb states, if you give people a fish, you feed them for a day; but if you teach people to fish, you feed them for a lifetime.
Our government will invest $2.7 billion over six years to help more unemployed and underemployed Canadians access the training and employment supports they need to find and keep good jobs. Additionally, $225 million will be invested over four years to identify and fill skills gaps in the economy, to help Canadians be best prepared for the new economy.
Our budget follows through on a promise to parents. Our budget will let parents, at their choice, extend their parental leave for up to 18 months versus the 12 months currently. This is important as it will provide enhanced flexibility to families, particularly in areas where there is a current shortage of child care spaces or where there is a prohibitive cost for child care spaces. As we all know, the gap between 12 months and 18 months in child care is great, because a lot of child care centres do not offer the service for kids between those ages, or younger.
Additionally, there is a new employment insurance caregiving benefit of up to 15 weeks to cover situations where individuals are providing care to an adult family member. As well, expectant mothers will be allowed to claim EI maternity benefits of up to 12 weeks before their due date versus the current standard of eight weeks. Taken together, these measures are smart investments to assist Canadian families.
A few other measures that I believe are noteworthy include an initiative for better data collection in the Canadian housing market, with a $39.9 million investment to establish a housing statistics framework to address housing data gaps identified by the federal, provincial, and municipal housing working group. Our government's actions to date on the housing market are to ensure a sound housing market for all Canadians. Better data collection will strengthen our ability to ensure that home ownership remains robust and that our housing market remains sound.
Finally, a measure on which I hope to comment in the future is the introduction of the new Canada caregiver credit, which will vastly simplify the current system. It will replace the caregiver credit, the infirm dependent credit, and the family caregiver tax credit. With a single new tax credit, we will be better able to support those who need it the most. It will apply to caregivers, whether or not they live with their family member, and help families with caregiving responsibilities.
It is this type of measure that reflects the values of this government, and it will make a real and positive difference in the lives of Canadian families. It makes me proud to be part of a government that introduced budget 2017 with those types of principles and values.
Mr. Gérard Deltell (Louis-Saint-Laurent, CPC):
Mr. Speaker, it is always a pleasure for me to rise in the House, but obviously I am very disappointed.
I am very disappointed today to speak on this budget that, unfortunately, keeps going down the wrong path that the Liberal government wanted to take a year ago. The government has completely lost control of public spending. It is living beyond its means, it is leaving spiralling debt for our children, our grandchildren and our great-grandchildren who, unfortunately, will have to pay for the current government’s mismanagement.
It was not surprising, three days ago, to see the Minister of Finance all happy and proud, as is the tradition, to be able to launch his budget with a photo session, what in the business is called a photo op, surrounded by a group of children. What is clear is that he was surrounded by those who are going to have to pay later for today’s mistakes. That is the defining mark of the current Minister of Finance's second budget.
The government got elected, we sadly recall, almost two years ago on a formal commitment: to run very small deficits for three years of a maximum of $10 billion and to return to a balanced budget in 2019.
Basically, this was not a good election promise. However, we are democrats. We respect public opinion. The people spoke in October 2015 and elected the Liberal Party, which promised to run very small deficits. Had they run very small deficits, we would not have been happy, but we would have at least respected those who kept their word.
However, that is not the case here. Within months of getting elected, here we have them wallowing in a spending spree, completely breaking their election promise to run very small deficits. In the first year, we saw this government run a deficit that according to the books is $23 billion.
Let us not be fooled: the reality is that this government took the $6 billion financial cushion, which was to provide the necessary flexibility for unforeseen circumstances, not to deal with emerging economic issues, but to deal with its mismanagement. The reality is that the first year of this government resulted in a $29-billion deficit. This is three times worse than expected.
The government's latest budget does not deviate from that path: deficits, deficits, and more deficits. This year, $28.5 billion; next year, $27.4 billion; $23.4 billion in 2019-20; and $21.7 billion and $18.8 billion in the years after that. How very typical of this government: deficits in the tens and tens of billions of dollars.
The Liberal plan was to balance the budget in 2019-20. That is what millions of Canadians voted for. Instead, the Liberal Party will be partying it up with a deficit approaching $24 billion. That is typical Liberal government, and we will not stand for it.
When I say “we”, I do not mean just the Conservative Party, the party that balanced the books and left Canada on sound financial footing, the party that, under the leadership of the Right Honourable Stephen Harper and experienced ministers including John Flaherty and Joe Oliver, made sure that Canada emerged from the worst financial crisis this country has seen since the 1920s faster and in better shape than any other country.
We left the house in order and a $2.9 billion surplus. When I raised this point a few days ago, the Prime Minister refused to answer my question and spouted a bunch of nonsense about how it was not true. It is. If he cannot see that, could he at least believe the parliamentary budget officer who, at the request of Senator Larry Smith, determined that our government left a $2.9 billion surplus? We were careful about that. We were careful with government finances.
Should we be surprised by the Liberal government's lack of vision and finesse with respect to financial responsibility? Mr. Speaker, I do not know where you were and, honestly, I do not remember where I was on October 10. What I do know is that the Minister of Finance was in his office.
What did he have on his desk on October 10, 2016? He had a report signed by his own officials that concluded very clearly on page 14 that if Canada did not change course, the budget would not be balanced until 2055 and we would be $1.5 trillion in debt by 2050—incidentally, $1 trillion is $1,000 billion. In other words, the Liberals missed their mark by 36 years. Even worse, they have absolutely no plan to balance the budget.
Mr. Speaker, in your personal life, if you exceed your budget and go into debt, year after year, do you think that one day someone might knock on your door and tell you to get your act together? I know you are an honourable man, but it could happen to anyone.
How is it that the people who control a budget of $330 billion could lose sight of what all parents and Canadians know? That is what does not make sense. Even worse, the Minister of Finance was so proud to have that report on his desk, a report written by his own officials that said that if nothing changed, we would not return to a balanced budget until 2055, that he kept it all to himself for 10 whole weeks.
If such a damning report were written about me, I too might want to stick it in a desk and pretend that it did not exist. The Minister of Finance's primary responsibility is to face facts and to face the 35 million Canadians who pay his salary. That proves he did not have a clear conscience. It is hard to have a clear conscience after getting elected on a promise to return to a balanced budget by 2019 only to have that turn into 2055.
Worse yet, the government squandered an opportunity to turn things around with this budget. It chose to stay on the same path, the path to deficits, the path to debt, and the path to transferring debt to our children and grandchildren, who are going to pay the price for this mismanagement.
The Conservative Party is not alone in crying foul. Yesterday, on RDI, a Radio-Canada/CBC station, René Vézina, an economist, said, “The fact remains that there is quite a bit of red ink. There is no end in sight.”
It makes no sense, we need to know that much. What if the minister had told us that, well, we are spending quite a bit, but in seven, eight or nine years, we will be back to a balanced budget. That would not have been great, but at least there would have been a game plan, a vision, an action plan. We would know where we were going. This is not the case. There is no vision about the future of public finances, nothing. This is completely unacceptable.
That is what led Mr. Vézina to say that this is nonsense. That is also what led Carl Vallée, spokesperson for the Canadian Taxpayers Federation, to say that it does not make sense and that “the fact there is no sign of returning to a balanced budget soon is very troubling and certainly the most disappointing aspect of this budget”.
This is the reality and that is why we have to be careful.
What about Michel Girard, economist and analyst with Quebecor’s QMI, LCN and TVA? He said that this is a big spending budget, that “the federal debt is out of control” and that we are lucky we currently have low interest rates. However, sooner or later, interest rates are likely to rise and each percentage point increase means an extra $6 billion or $7 billion.
François Pouliot of Les Affaires wrote that “the goal of any government should be to protect its credit rating for the future and to get on a better financial footing for the next generation”.
That is exactly the opposite of what this government is doing. It makes no sense. There is a complete loss of control when it comes to taxpayers’ dollars.
There are other worrisome aspects, such as tax increases that will be borne by taxpayers and the elimination of certain tax credits put in place by our government. First, the government decided to come up with the Friday and Saturday night tax. The government is now charging a new additional tax on alcohol, tobacco, and the like. So when a Canadian worker, who has worked hard all week, seeing half of his paycheque going to taxes, wants to have a cold beer with his friends on Friday night, he will have an extra tax to pay thanks to this good government.
On Saturday evening, hardworking fathers or mothers who want to enjoy a good meal with their spouse and go buy a nice bottle of wine will now have to pay more thanks to this government. That is because of the Friday and Saturday night tax that this government just imposed. I am not the one saying it, it is an economist. I did not come up with that phrase.
It is not a good idea to raise taxes on alcohol and tobacco. According to the Canadian Taxpayers Federation, this is a major tax increase for consumers. It is a way for the government to take money out of the pockets of those who are going to use these completely legal substances regardless.
The government needs to be very careful about doing that.
What is more, there are dozens of tax credits. If someone had told me two days ago that I was going to say what I am about to say, I would not have believed it possible because we are talking about the Liberals. However, the Liberals are indeed directly attacking people who use public transit. Who would have thought?
This government goes on and on about how much it cares about the environment, unlike the big, bad Conservatives who could not care less. This government says it wants people to use public transit instead of cars. It has even said crazy things about the oil industry, but that is another story. Now it is eliminating the tax credit for transit riders, a tax credit created by the Conservative government.
Who would have thunk it? The Liberals are doing away with a green policy implemented by the Conservatives. That makes no sense.
Who is this move going to hurt? Cash-strapped students who have to scrimp and save. Seniors and people who cannot afford a car. People with modest incomes. People who want to be part of the solution, people with an environmental conscience who care about the planet and want their footprint to be as small as possible, who choose public transit over cars. Those are the people the Liberal government is hurting here. Those are the people the Conservative government protected. It was not a flashy measure, but it was a good one that should not have been axed.
Again, it is not just us big, bad Conservatives saying that. Who else? Our friend Denis Coderre, mayor of Montreal, and former Liberal member and minister is saying the same thing. Denis Coderre is criticizing the Liberal government. I am sensing some scepticism across the way. Allow me to quote an article by Boris Proulx, updated on March 22, 2017, at 6:15 p.m. to be precise: “[Denis Coderre] is disappointed that the budget eliminates the tax credit for transit passes. He sees this as a contradictory measure from the Trudeau government.”
That was Denis Coderre, former minister, former Liberal member in this place, and a good friend of the current Prime Minister, the hon. member for Papineau, as everyone knows. “How can the government fund mega projects in public transit and then stop encouraging Canadians from using it?”, the mayor asks.
I have the same question for the governing party. They do not have to answer me if they do not want to, but let them at least answer their friend Denis Coderre who is questioning their unacceptable contradiction.
The same goes for public transit users, who simply do not understand. On TVA yesterday, people in the street were asked what they thought of that measure. They said it makes no sense. Sure, that tax credit was not going to change the world, but still, it was a little extra incentive. It gave people a bit of breathing room, and they were excited about that. Now the Liberals have decided to punish people who use public transit. It is just ridiculous.
I would point out that there were some other Liberals who were not too happy, either, namely the Quebec provincial government Liberals, under the leadership of the Hon. Philippe Couillard, the Premier of Quebec. We know that there is no link between the provincial Liberal Party and the federal Liberal Party, ever since Jean Lesage in 1965, but they are Liberals nonetheless. Yesterday, the Quebec minister of finance and the president of the Treasury Board were “extremely disappointed”. Here is exactly what senior ministers in the Couillard government said yesterday: “We are extremely disappointed and concerned that there's no clear signal in this budget.” There is nothing in this budget to address Quebec's needs. Pierre Moreau called out his federal counterparts:
|| I would have liked to hear the Quebec caucus speak up on matters relating to the province's major infrastructure projects.
I am therefore once again asking my government friends from Quebec where they were when it was time to stand up for Quebec at the cabinet table. I have a lot of respect and regard for the member for Louis-Hébert, and he knows that. However, the president of the Quebec treasury board, the hon. Pierre Moreau, believes that the 40 federal MPs from Quebec were mostly silent, restrained, and sidelined during the preparation of the budget. I am therefore calling them to order.
Many people who believed in what this government could do were disappointed by this budget. We, on the other hand, knew full well that the government's approach to managing public funds was wrongheaded.
Now let me talk about innovation.
The current government is very proud of innovation. The Liberals say that this is the budget of innovation, and they talk a lot about innovation. The Globe and Mail reported that the Liberals used the word “innovation” more than 250 times in the budget. This is the key issue of this budget, is it not? The reality is that we are talking about $1 billion for the next five years. It is not bad, and we are not against it, but is it really an innovation budget that they are talking about? Not so much.
More than that, I just want to say something for the members. Yesterday we were around the table with some colleagues working on that, and I had the privilege of sitting with great personalities, great people who served this country well for the past 10 years as ministers. Among them, close to me, was a former minister. She said, “Look at that. They are talking about innovation, but there is nothing new there. We did exactly the same a few years ago, when I was a minister.”
The former Conservative government tabled a plan called “building Canada's innovation economy”. That is exactly what it was. We created that too, and we were not the first government to table that kind of issue, because every government has to address the issue of innovation. Year after year, in the 1960s, the 1970s, the 1980s, and the 1990s, all governments tabled innovation platforms. This is good. We did it, and the Liberals are doing it; fine, but is that worthy of being called brand new? Not at all.
This is why I just want to say to the cabinet minister that we do agree on some issues, especially about innovation, because it is the reality of Canada and the reality of every country that governments have to address the issue of innovation instead of looking at others and doing what they do.
However, the way to help businesses is to lower taxes. With the current government, there is no indication that it wants to address the reality of the Trump administration, which has said day after day that it is going to lower taxes in America. If we do not do that, our companies and businesses will not be able to respond appropriately to our most important partner and our most important competitor.
However, I still want to be a good sport and recognize the good things that this government has done, particularly in this budget, such as the support for family caregivers. This is a sensitive issue that cuts across party lines, and our government made investments. When my colleague from Richmond Centre was in government, she made some good proposals in the area.
We are pleased that the government has decided to implement these measures and to group them in a single program that will move things along. Well done. It is the right thing to do.
Unfortunately, this government missed an historic opportunity to turn things around. It had a golden opportunity to admit that the plan it implemented one and a half years ago has not yielded the desired results. If it does not turn things around and take control of spending we are going to hit a wall and our children and grandchildren will be footing the bill. Unfortunately, this government failed on that account.
The government had a golden occasion to say it would get back to controlling public spending, but unfortunately it failed. It has only created a budget that is a manufacturer of deficit. This is why we urge all the members here to reject this bad budget.