Hon. Marcel Massé (President of the Treasury Board and Minister responsible for Infrastructure, Lib.): Mr. Speaker, I would also like to table, in support of the estimates, Part I, ``The Government Expenditure Plan''.
In addition I will table with the Clerk of the House on behalf of my colleagues Part III of the estimates consisting of 76 departmental expenditure plans. These documents will be distributed to the members of the standing committees to assist in their consideration of the spending authorities sought in Part II of the estimates.
This is my first occasion to address this House as the President of the Treasury Board. And if I may say so, I am very pleased to be here in this capacity, although I am very aware of the many responsibilities that this position brings with it.
The control of the government's expenditures, the delivery of public services adapted to the needs of Canadians, and the well-being of a dedicated and efficient public service are all significant challenges facing the Treasury Board. They are issues that I was able to examine in depth in my former portfolio of President of the Privy Council and Minister reponsible for Public Service Renewal.
I would like to take the opportunity, today, not only to discuss the content of the estimates tabled in this House, but also the process and initiatives that preceded them.
In particular, I would like to highlight the program review begun two years ago and the prospects it offers for today, the many alternatives for delivering government services, and our vision of a renewed, dynamic, and efficient public service.
(1010)
The estimates submitted to this House reflect the government's main priority-which encompasses all of the others-and that is to put Canada back on the right track a track characterized by fiscal
responsibility, by more effective program and service delivery, and by harmonious and productive relations between the federal and other levels of government.
When we assumed responsibility in 1993, the government was struggling with two major, endemic problems: a deficit and a debt that were out of control, and a lack of clarity in the roles and responsibilities of the federal government. To put the country back on the right track, we had both to reduce the budget deficit and clarify the roles, responsibilities, and priorities of the Government of Canada.
Canadians clearly would not be satisfied with cosmetic solutions. They expected us to act methodically and with good judgment. This was the framework in which we launched a comprehensive review of all federal government programs and services in 1994.
We based this review on six specific criteria. First, the criterion of public interest: Was the activity still serving the public? Second, the role of the government: Did the government have a necessary and legitimate role in this activity? Third, the criterion of federalism: Could some other level of government deliver the program more effectively? Fourth, the criterion of partnership: What activities or programs could we transfer, in whole or in part, to the private sector or a volunteer organization? Fifth, the criterion of efficiency: How can we enhance the efficiency of the activity or program? And sixth, the criterion of affordability: Can the government still afford this type of activity?
This program review has been a success on many fronts. First, it has enabled the government to reduce is spending significantly. By the end of 1998-99, program review measures will have reduced program expenditures by $9 billion.
[English]
The program review decisions have also enabled the government to refocus its efforts and to concentrate on its priorities. For example, there have been almost no reductions in the programs for aboriginal peoples and those for corrections and the justice system. In contrast we have cut spending on natural resources and defence substantially and eliminated many subsidies to business.
The program has opened the door to very interesting prospects in federal-provincial relations. In particular, federal departments have a much clearer picture of their roles and responsibilities. This new vision is based on a recognition of the federal government's true spending capacity and a clear understanding of its priorities.
Our vision was evident in last week's throne speech and the subsequent statement by the Prime Minister. We are confident that it will have a positive impact on relations between the federal and other levels of government and will strengthen Canadian unity.
I have also tabled in the House, along with the estimates, a document entitled ``Getting Government Right'' which summarizes the government's approach to its review process and highlights the key results to date.
[Translation]
In addition to redefining its role and responsibilities, the Government of Canada must also attack another fundamental issue: What are the most efficient and least costly ways to deliver its programs and services? Like most organizations in the world, the government has rethought the way it delivers its services based on what many call the ``client approach.''
The government continues to develop ways to measure performance. It is making more use of modern technology to reduce costs and enhance service quality. And more and more, it is seeking feedback from Canadians on the quality of the services they receive. As a service provider, we must be flexible if we are to meet the expectations of our citizens. That is why we must be open to other ways of delivering our services.
(1015)
But this does not mean that the government's presence will no longer be important, because it will continue to play an active role. Alternative delivery will not be appropriate for all federal programs or services. The Treasury Board will review carefully individual programs or services put forward as candidates for alternative delivery.
The government will continue to restructure service delivery where this is a sensible thing to do. A few examples will illustrate some of the ways in which we have experimented with alternative service delivery.
[English]
For example, for some years the government has been shifting its role from an operator of the transportation system to focus on developing policy and legislation and enforcing standards for safety and security. This has led to the transfer of airports to local airport authorities and the proposed sale of Transport Canada's air navigation system to a not for profit operator.
The sale of both Petro-Canada and CN Rail illustrates situations where it makes sense to privatize government assets or activities that the public sector no longer needs to retain.
Using an alternative delivery model, Canada business service centres provide single window services to small businesses from 21 federal departments and agencies and related provincial services.
Recent announcements have enhanced the development of new approaches to services. The government has announced the cre-
ation of three new organizations, a parks agency, a single food inspection service and a Canada revenue commission. These organizations, which will remain within the public sector, will be established under separate legislation.
As our experience with these new structures increases, we expect other departments and agencies to submit more candidates for alternative program delivery.
In addition, the Treasury Board has recently established a new policy for employee takeovers which will make it easier for groups of employees to take over activities their departments previously did. We already have some early examples of this process. We see real potential here to privatize or commercialize certain functions in a way that protects the jobs of former public service employees and yet allows the government to reduce costs.
Our approach to service delivery is pragmatic. Our goal is to identify flexible and efficient delivery options so that we can continue to offer Canadians the services they expect.
Each case must be evaluated on its merits and the solution made to measure in the spirit of innovation, efficiency and service to the client.
[Translation]
The past six years have been difficult ones for the Public Service of Canada. As a former career public service employee, I am very much aware of this fact. The significant reductions in the number of jobs have created uncertainty and anxiety among employees. For those who remain, there has been no collective bargaining and their workloads have increased. Salary increases have been suspended for five of the last six years.
I am pleased to say, that we can now see the light at the end of the tunnel. Not only do we wish to treat our employees fairly, we what them to be motivated and feel valued for the work they do for the public service.
In the near future, we will introduce measures that will help to recognize our employees' contributions and modernize our human resources practices.
I am pleased to announce that the Public Sector Compensation Act will not be extended and will expire as scheduled. This act was introduced as a temporary measure in 1991, and has been subsequently extended and broadened in its application. It has been an important component of accomplishing much needed fiscal objectives.
As the Minister of Finance confirmed in the budget yesterday, the government is on track with its fiscal targets. Now it is time to resume more sustainable compensation practices. This means that, beginning this June, we will lift the two-year suspension of annual increments, as was promised when this provision was introduced.
(1020)
At the same time, we will reintroduce performance pay, the equivalent of such increments for more senior employees, which has been suspended since 1991.
Because of the timing of the application of the Public Sector Compensation Act, some junior ranks in the Canadian Forces have a salary shorfall when compared with other public service employees. We will compensate these groups by lifting the freeze on them sooner. My colleague, the hon. David Collenette, will announce details shortly.
[English]
The government is committed to returning to collective bargaining in a way that is fair to employees and to taxpayers. Many critics say collective bargaining cannot work in the present public sector environment. The success we have had with most of the unions in negotiating terms for alternative service delivery gives us cause for optimism. It shows that collectively it is possible to find better solutions to difficult issues when both sides are prepared to make a reasonable compromise, the very essence of collective bargaining.
We need to bring together at one table issues such as wages, benefits and employment security which have a cost for the employer and economic value for employees rather than dealing with them separately. Where we can increase efficiency by streamlining existing policies and practices such as the travel and foreign service directives, we will share the savings at the table.
We will ask the unions to sit down with us shortly to design such a process. However, given the difficult times ahead of us we must be cautious. Obviously with our continued need for fiscal responsibility we cannot leave determining the results of collective bargaining to a third party unaccountable to Parliament. For this reason we will introduce legislation shortly to suspend the binding arbitration in collective bargaining for the next three years.
[Translation]
It is clear that both the services of government and how these services are delivered must change. While it is not possible to guarantee continuing employment for all public service employees, we want to protect employees when arrangements are made to transfer activities out of public service departments to alternative service delivery structures, whether they are inside or outside the public sector.
We will introduce legislation to provide fair and reasonable conditions for employees who transfer to a new employer in such situations. We will enhance these arrangements for employees in unions with which we have entered into agreements on such transfers.
We will also introduce a series of amendments to the Public Service Superannuation Act to provide for pension vesting and portability arrangements that meet the requirements of the Pensions Benefits Standards Act. This will give public service em-
ployees the same range of pension options that other employees have when they leave their employees.
Yesterday, my colleague, the Minister of Finance, noted in the budget that more employment reductions are likely. We do not anticipate than these reductions will be as big as those resulting from previous decisions. Departments will decide during the coming months where to make these reductions for 1998-99 and establish what impact the reductions will have on employment.
We do not expect to have to extend the early Departure Incentive and early retirement incentive programs beyond their current expiry dates.
The Public Service of Canada has always been known for its competency, integrity, and hard work. I am confident that the men and women of the public service will continue to display these qualities of professionalism.
I would now like to highlight the key elements of the 1996-97 Estimates. This year's estimates package responds to concerns of parliamentarians and the auditor general about the need to make the estimates document more strategic, easier to read, and less oriented to accounting.
(1025)
We have included in the package six pilot Part IIIs that test the new approach. Part III has been simplified and arranged to bring together in one section all the information related to departmental performance. We shall continue to work with parliamentarians and others to evaluate this new way of presenting information. If it is effective, we shall update the information and table more departmental performance reports in the fall.
[English]
The estimates provide details to support $157 billion in expenditure authorities for the 1996-97 fiscal year. Of this total, $45 billion must be voted and authorized through an appropriation act. The remaining $112 billion is statutory and has been approved previously by Parliament in various pieces of legislation. All those statutory programs do not require Parliament's approval.
The estimates provide information on how these programs are proceeding. Although the Minister of Finance presented planned program spending of $109 billion in his budget yesterday, this figure and the total in the estimates differ significantly.
In particular, the estimates do not include any program spending changes that require legislation. These technical differences between the estimates and budget figures can obscure the information parliamentarians need to examine departmental spending plans.
Therefore this year I am introducing a new document entitled ``Program Expenditure Detail: A Profile of Departmental Spending'' which provides information on program expenditures at departmental and agency levels. This document will undoubtedly help people who use the estimates to understand the implications of the program review and other changes in spending plans for the coming fiscal year.
The move to a smaller, more effective federal government means spending on programs and services will continue to drop. The government plans to spend $109 billion on programs and services in the coming year. This is almost $5 billion or about 4.4 per cent less than in 1995-96.
[Translation]
Let us now take a look at the challenge ahead. This government has taken a straightforward approach in its efforts to put Canada on the right track. First, we must get the deficit under control so that we have a reasonable margin to manoeuver in responding to the issues facing Canadians. Second, we must enhance our ability to assess and respond to the new pressures on Canadian society.
Finally, by relying on a motivated and dynamic public service, we must provide Canadians with a government that knows how to deliver its programs and services more efficiently and more flexibly. I know we are on the right track.
[English]
Mr. Strahl: Mr. Speaker, on a point of order. Given the size of the estimates, the dollar amount of the announced national debt and the impact this will have on Canada's social programs and future taxation, would it be appropriate to ask for a moment of silence to allow the minister personal reflection-
The Acting Speaker (Mr. Kilger): Clearly the hon. member does not raise a point of order.
[Translation]
Mr. Richard Bélisle (La Prairie, BQ): Mr. Speaker, the President of Treasury Board this morning tabled the Estimates of nearly $157 billion, of which $76 billion is earmarked for various transfer payments to individuals and the provinces primarily and nearly $48 billion will go to service the public debt, which is the government's largest budget item each year.
The minister said that deficit control, improved government ability to assess and react in time to new pressures exerted on Canadian society and support for a motivated and dynamic public service are the three main pillars underlying the 1996-97 Estimates.
(1030)
Let us have a closer look at the merits of the minister's objectives and try to assess the means he will use to achieve them.
To control the deficit, they talk of controlling government expenditure through program review. What has come of these
program reviews? We should point out that all major regional development agencies are seriously affected in this time of high unemployment, when young people are leaving the regions for the cities.
There is, for example, the Enterprise Cape Breton Corporation, whose budget has been cut by 36.1 per cent; the Western economic diversification program, cut by 24.3 per cent, and the Federal Office of Regional Development-Quebec, the hardest hit by a budget cut of $102 million or 21.3 per cent of its total budget.
Meanwhile, the budget of the Office of the Commissioner for Federal Judicial Affairs has been increased by $6.3 million, an increase related to judges' salaries, allowances and pensions.
Although cut, defence spending still represents 21 per cent of direct program expenditures, excluding transfer programs. This is still far too much in a post cold war period.
The minister says we have to look and see whether, in the federal context, another level of government would be better placed to deliver a specific program more effectively. I would say to the minister that 11 years as councillor with the city of St. Lambert, a city in my riding, 13 years as a Quebec provincial official and two years here in this House as a federal elected representative have shown me very clearly that the closer a government is to the people, the more effectively it delivers a program and that the client approach the minister seems to favour requires the transfer of as many powers as possible to the provinces, the regions and the municipalities.
The increased control the government is preparing to exercise is what hurts the most. While it is talking about a client approach, the government is planning to create three new agencies, as mentioned this morning by the minister: a national parks board, a single food inspection agency and a national revenue commission that will be competing directly with Revenue Quebec, which already collects the GST and the QST on its territory.
There is a lack on consistency between the goals set by the minister and the means he intends to use to meet them. The government is talking about flexible arrangements with the provinces, but whenever it has a chance, it tries to centralize.
Similarly, we are told that, by the end of the 1998-99 fiscal period, the new measures brought about by this year's program review will allow the government to cut its program spending by $9 billion. However, the documents tabled yesterday in this House by the Minister of Finance clearly show that, due to the reallocation of funds to other programs, the net result of the program review will be a net increase of $34 million this year and a drop of barely $200 million next year, as the effect of this year's new measures will obviously be felt only in two or three years.
In short, cuts are badly targeted, reallocations are badly targeted, and, for the time being, these new measures have absolutely no impact on the fiscal situation.
To conclude, I would like to ask the minister how he thinks he will be able to rely on a motivated and dynamic civil service, when a more generous package is being offered to employees belonging to the unions with which the government has reached a settlement regarding the transition to a new structure, and when the Minister of Finance announced in yesterday's budget the possibility of more layoffs?
(1035)
[English]
Mr. John Williams (St. Albert, Ref.): Mr. Speaker, I will start by congratulating the minister on his appointment as President of the Treasury Board. I also congratulate the department on the six pilot projects on the reformatting of the part IIIs so that parliamentarians can more fully enjoy and appreciate what is going on in the departments. We hope this progress will continue and that parliamentarians will be able to have useful documentation in order to analyse what the government is doing. Unfortunately my compliments seem to stop there.
The government is spending $157 billion and the minister gave a fairly short speech to cover how the government intends to do that. He boasts about the fact that program spending is coming down by about $9 billion, but interest on the debt is going up by $9.8 billion. It is not even a saw-off; we are spending more money. That was quite evident in the budget which was tabled yesterday by the Minister of Finance. We saw quite clearly that the deficit is coming down on the backs of the taxpayers because as the deficit has come down by $25 billion, tax revenues have gone up by the same amount.
He talked about program review. In the last session of this Parliament I tabled Private Member's Bill C-289 which talked about program review. I said that four things have to be done. We should be looking at programs and reviewing programs on a cyclical basis, based on the following: What is a program designed to do? Is the program meeting that definition that we intend to serve society? Is it being done efficiently? Is it a better way to accomplish the same service to society at a lesser cost?
The program review which has been done by this government has been done behind closed doors. It has been politically motivated. We have not seen very much in the way of efficiencies and improvements. Yet the government continues to slash across the board each department by 2 per cent, 3 per cent and 4 per cent. That is not program review; that is management without intelligence. It is basically cost cutting for the sake of cost cutting. It does not focus on service to Canadians.
If we look at the main estimates which were tabled today, we wonder why the status of women and the office of the co-ordinator get almost a 9 per cent increase, up by $1.3 million, while every other Canadian has to do with less.
The Department of Citizenship and Immigration will get another $8.6 million, which is an increase of 3.8 per cent. That amounts to $8.6 million extra with the concept that it is going to save money. It seems rather strange.
We all know what is happening in the fisheries, but the government is going to give an extra 47 per cent to the Department of Fisheries and Oceans. Maybe that is just to go out and look for some fish. We need programs that work and programs that help Canadians. Giving another 47 per cent to the Department of Fisheries and Oceans is not going to bring back the fish as far as I am aware.
The Department of Foreign Affairs and the Canadian International Development Agency are both up, while Canadians get less. We want to maintain this facade of an image abroad that Canada is a wonderful place and that it has money to spend, while Canadians pay more and get less.
These are the types of things that have to change if the government is going to get it right. One of the documents which the minister tabled this morning was: ``Getting Government Right''. I think that getting government right is spending on Canadians, not maintaining this facade abroad by spending our money on other people.
It says here that the Department of Indian Affairs and Northern Development had a 20 per cent reduction in its budget, but yesterday the Minister of Finance said that the government was going to spend more. Money is going up and the numbers are going down just because they fudge it and move it elsewhere.
These are not the types of things we like to see in the estimates. We like to see some real solid facts and continuity from year to year so that parliamentarians can understand what the government is doing.
His own department, Treasury Board Secretariat, is going to get another $160 million. That is the department which is in charge of downsizing government, but he takes another $160 million for his own department to do that. It is incongruous that we see these types of numbers in the estimates.
(1040 )
I was glad to see the minister intends to remove the wage freeze next year. We have already called for the government to do that and we are glad to see it is doing it. At the same time we called for the unions to give up the job guarantees. We want to see merit in the civil service where people who do a good job are recognized. We want every civil servant to know that if they are doing a valuable job and doing it well, job security is there on that basis. We have to tell them that.
However, the government has gone one step further. It has suspended binding arbitration. It has said it is prepared to talk about an increase in wages, but it will suspend binding arbitration which simply says: ``We are going to compromise, but we will do it our way''. I do not think that is the message the government should be sending to the civil service. It is like the sword of Damocles.
Last year the Minister of Finance announced 45,000 job cuts. Tens of thousands of jobs were going to disappear and the civil service took it on the chin and carried on knowing that the morale was low because so many of their colleagues were going to go. Yesterday the Minister of Finance said: ``That is not all. More are going to go''. We do not know how many are going to go or when.
The minister said this morning that the civil service is known for its competency, integrity and hard work. The government has maintained the wage freeze during the two and a half years it has been in office. It has said it is going to eliminate 45,000 jobs and it has said it is going to eliminate more. It is going to deny binding arbitration to the civil service. I wonder how long Canadians can expect competency, integrity and hard work from those in the civil service while the government continues to treat them this way. That has to change. We have to treat our civil service well. We have to recognize that those employees are working under difficult circumstances and they deserve better treatment.
The minister talked about client approach. Client approach in the government has to serve Canadians. As a businessman I always knew I could look after my customers. Accountability and service delivery has to be number one. While the minister talks about it, what do we find?
The Canadian health and social transfer is being maintained at a constant level by the Minister of Finance. He said so yesterday. There is no accounting for inflation which means that the extra costs are going to have to be borne by the provinces. That is not service.
We have seen cuts to medicare from the 50 per cent that was guaranteed by the Liberal government many years ago. It is now down to the fact that it is only paying 23 per cent of health care. And the minister calls this client approach service delivery. Hospitals are closing, people are waiting for surgery everywhere. That is not a service delivery approach. It is budget cutting and Canadians suffer.
Total spending is $157 billion in these estimates and we know there will be more coming in the supplementaries. There is $112 billion in statutory spending and we as parliamentarians are going to vote on $45 billion. That is a disgrace. It is absolutely intolerable
that with the fiscal situation we are in today we as parliamentarians can only vote and express an opinion on $45 billion out of $157 billion.
We know from past experiences over the last two years that the government has maintained that absolutely not one nickel can change in the estimates regardless of what people on this side of the House say. That has to change. I look forward to the day the Reform Party is over on that side and introduces some meaningful change so that parliamentarians on both sides can have input on how money is spent in this country.
According to the minister, spending will continue to drop. Taxes are going to remain high. We got no tax relief yesterday. The amount of money being spent on programs is going down and down every year by the government's own admission and there is no tax relief. It points out that the Reform Party had it right when it told the government to balance its budget as quickly as possible. Every dollar that Canadians are denied from tax revenue is being spent on bankers abroad. There is no way the government can deliver or continue to deliver social services to Canadians that are so dearly needed. The government promised jobs and it has yet to deliver on that promise.
(1045)
I see government is spending another $111 million on CIDA, the Canadian International Development Agency. The estimates say aid is going up and yet the Minister of Finance said yesterday it is going down $150 million over the next two years. This is yo-yo accounting. One year the government jacks it up, the next year it cuts down and says it is saving money. This is no way to do things.
Let us be realistic. If cuts are to be made, let us cut, let us cut now and let us get the benefits so that we can ensure that things are going well.
My last point is defence. I have some correspondence from the minister of defence. Last year he said that the estimate to build a new range in CFB Gagetown was $2 million. I see in the estimates it is going to cost $3.5 million. That is a 75 per cent increase over the estimate in one year.
In Shilo, Manitoba, construction estimates according to documents that I have was $29.9 million last year and is now going to cost $47.2 million. That is increase of 58 per cent over the estimate of less than one year ago. There is no management in defence. In the meantime it has been cut overall by 21 per cent. There are morale problems in the ministry of defence. The chief of defence staff has said he cannot even fight a war to defend Canadians. Budgets are being cut and the estimates are out to lunch. There is a problem in the management of the department of defence. It should be fixed and fixed now.
I look forward to examining these estimates in committee over the next few months. Reform members will be calling the government to task. We expect that if we point out real, meaningful and
intelligent savings that government members will agree to them and amend these estimates when we vote on them in the months to come.
If the House gives it consent I intend to move concurrence in the fourth report later this day.
This bill is in the same form as Bill C-96 of the first session at the time of prorogation. Therefore, I request that this bill be reinstated as provided in the special order adopted on March 4.
(Motions deemed adopted, bill read the first time and printed.)
The Acting Speaker (Mr. Kilger): The Chair is satisfied that this bill is in the same form as Bill C-96 at the time of prorogation of the first session of the 35th Parliament.
Accordingly, pursuant to order made on Monday, March 4, 1996, the bill is deemed to have been read the second time and referred to the Standing Committee on Human Resources Development.
(1050)
Mr. Speaker, this bill is in the same form as Bill C-111 at the time of prorogation of the last session. Therefore, I request that this bill be reinstated pursuant to the special order adopted on March 4.
(Motions deemed adopted, bill read the first time and printed.)
[English]
Mr. Williams: Mr. Speaker, a point of order. I would like clarification from the Chair that these bills can be reintroduced without the consent of the House. Could you please give me the rules on that?
The Acting Speaker (Mr. Kilger): I believe that a few days ago there was a vote on a motion regarding the appropriate procedure by the government to bring back certain bills from the previous session.
(Motions deemed adopted, bill read the first time and printed.)
The Acting Speaker (Mr. Kilger): The Chair is satisfied that this bill is in the same form as Bill C-111 was at the time of prorogation of the first session, 35th Parliament.
Accordingly, pursuant to order made Monday, March 4, 1996, the bill is deemed to have been referred to the Standing Committee on Human Resources Development.
(Bill deemed referred to a committee.)
He said: Mr. Speaker, I rise today to introduce my private member's bill which is entitled an act to amend the Bell Canada Act (construction charges).
Rural Canada is put at a disadvantage by inadequacies in the cost and accessibility of advanced communication technologies. In rural Canada this disadvantage extends to the simple provision of telephone service. Rural Canadians often face steep costs for service provisions because of their increased distance from existing lines. Right now service is mandated to customers within 62 meters of distribution facilities.
This bill proposes that service be provided for customers up to 1,000 meters away from existing lines and that beyond that construction charges be capped at a reasonable amount.
Phone service is an essential service. It should be affordable to rural Canadians. I ask all members of the House to support the bill.
(Motions deemed adopted, bill read the first time and printed.)
He said: Mr. Speaker, first I would like to thank my hon. colleague for Fraser Valley East for seconding this bill.
The purpose of this bill is to lower the age limit which defines who is a child or a young person for the purposes of the Young Offenders Act. It will now include young offenders age 10 and 11.
Currently the police cannot charge 10 or 11-year-olds who are picked up for robbery or for viciously beating innocent victims. Eleven-year-olds are deliberately recruited by gangs because the law cannot touch them. These youth need help but the system is failing them. They are falling through the cracks and we cannot get them into the appropriate counselling or rehabilitation programs because the current law says they are too young.
If they are old enough to pack a gun or a knife, sell drugs or their bodies, then they are old enough for the justice system to address their problems. The sooner they get relevant help, the easier it will be to reverse their criminal behaviour.
(Motions deemed adopted, bill read the first time and printed.)
(Motion agreed to.)
(1055)
[Translation]
Since 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 has been read.
Therefore I move, seconded by Hon. Ron Irwin:
That the Main Estimates for the fiscal year ending March 31, 1997, laid upon the table on March 7, 1996, be referred to the several standing committees of the House in accordance with the detailed allocation attached.The Acting Speaker (Mr. Kilger): Is there unanimous consent?
Some hon. members: Agreed.
[Editor's Note: The list referred to above is as follows:]
That the Main Estimates for the fiscal year ending March 31, 1997, laid upon the Table on March 7, 1996, be referred to the several Standing Committees of the House in accordance with the detailed allocation attached:
To the Standing Committee on Aboriginal Affairs and Northern DevelopmentIndian Affairs and Northern Development, Votes 1, 5, 10,
To the Standing Committee on Agriculture and Agri-FoodAgriculture and Agri-Food, Votes 1, 5, 10 and 15
To the Standing Committee on Canadian HeritageCanadian Heritage, Votes 1, 5, 10, 15, L20, 25, 30, 35,
To the Standing Committee on Citizenship and ImmigrationCitizenship and Immigration, Votes 1, 5, 10 and 15
To the Standing Committee on Environment and Sustainable DevelopmentEnvironment, Votes 1, 5, 10 and 15
To the Standing Committee on FinanceFinance, Votes 1, 5, L10, L15, 20, L25, 35 and 40
To the Standing Committee on Fisheries and OceansFisheries and Oceans, Votes 1, 5 and 10
To the Standing Committee on Foreign Affairs and International TradeForeign Affairs, Votes 1, 5, 10, 15, 20, L25, L30, 35, 40,
To the Standing Committee on Government OperationsCanadian Heritage, Vote 140
To the Standing Committee on HealthHealth, Votes 1, 5, 10, 15, 20, 25 and 30
To the Standing Committee on Human Resources DevelopmentHuman Resources Development, Votes 1, 5, 10, 15, 20, 25,
To the Standing Committee on Human Rights and the Status of Persons with DisabilitiesJustice, Vote 10
To the Standing Committee on IndustryIndustry, Votes 1, 5, L10, L15, 20, 25, 30, 35, 40, 45,
To the Standing Committee on Justice and Legal AffairsJustice, Votes 1, 5, 15, 20, 25, 30, 35 and 40
To the Standing Committee on National Defence and Veterans AffairsNational Defence, Votes 1, 5 and 10
To the Standing Committee on Natural ResourcesNatural Resources, Votes 1, 5, 10, L15, 20, 25 and 30
To the Standing Committee on Procedure and House AffairsParliament, Vote 5
To the Standing Committee on Public AccountsFinance, Vote 30
To the Standing Committee on TransportPrivy vote 15
To the Standing Joint Committee on the Library of ParliamentParliament, Vote 10
To the Standing Joint Committee on Official LanguagesPrivy Council, Vote 25
(Motion agreed to.)
[English]
The first petition I present this morning, and I am honoured to do so, is due to the many changes to food and food products as a result of the current rise in genetic engineering.
Canadians request Parliament to ensure that all transgenic foods and food products be clearly labelled that they are transgenic foods.
The petitioners request Parliament to please look seriously at the Divorce Act to consider changing it in order to allow grandparents standing in the court to ask for access.
The petitioners draw the attention of the House to the fact that the Constitution Act of 1982 guarantees freedom of conscience and religion in the Canadian Charter of Rights and Freedoms, and that recognition of conscientious objection exists in Canada.
They pray and call on the Parliament of Canada to establish peace tax legislation by passing into law the private member's bill of the member for Burnaby-Kingsway, the conscientious objection act.
The first petition has to with the family. The petitioners would like to draw to the attention of the House that managing the family home and caring for preschool children is an honourable profession which has not been recognized for its value to our society.
The petitioners therefore pray and call on Parliament to pursue initiatives to eliminate tax discrimination against families who decide to provide care in the home to preschool children, the disabled, the chronically ill or the aged.
The petitioners would like to bring to the attention of the House that consumption of alcoholic beverages may cause health problems or impair one's ability, and specifically that fetal alcohol syndrome and other alcohol related birth defects are 100 per cent preventable by avoiding alcohol consumption during pregnancy.
The petitioners therefore pray and call on Parliament to enact legislation to require health warning labels to be placed on the containers of all alcohol beverages.
The petitioners point out that whereas section 43 of the Criminal Code allows school teachers, parents and those standing in the place of a parent to use reasonable force for the correction of pupils or children under their care; and whereas the 1994 study in Ontario found that 85 per cent of all reports of physical abuse of children began as attempts to discipline; and whereas the use of force for correction teaches children that violence is an acceptable method of dealing with conflict, the petitioners call on Parliament to end legal approval of this harmful, discriminating practice by repealing section 43 of the Criminal Code.
The Acting Speaker (Mr. Kilger): Is that agreed?
Some hon. members: Agreed.
[Translation]
The Acting Speaker (Mr. Kilger): Before we move on to debate I wish to inform the House that due to the statement by the minister, Government Orders will be extended by 39 minutes.
[English]
Mr. Blaikie: Mr. Speaker, I rise on a point of order. Pursuant to a discussion we had the other day in the House I rise to seek the unanimous consent of the House that the NDP be allowed to respond after the spokespersons of the three official parties in the House.
The Acting Speaker (Mr. Kilger): Is there unanimous consent?
Some hon. members: No.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Mr. Speaker, we often say that we should sleep on something, and I did. However, I am still of the same opinion as yesterday, and I have the same arguments against the last budget of the Minister of Finance.
To us, this budget is window-dressing. It was a big production meant, first and foremost, to hide the real damaging effects of the finance minister's measures on the economy and on jobs, and to hide also the real state of the federal government's finances.
The minister who, for months, has been saying that he is a good manager, that he will reach his budgetary targets and make sure we see a definite improvement in public finances, forgot to tell us that the accumulated debt will top $600 billion this year. He forgot to tell us also that since he has been in the job, and after three consecutive budgets, he has added more than $110 billion to the debt. Is that good management of public finances? Is that controlling the medium-term debt? Is that having regained control of public finances? I wonder whether it is not the contrary. I does not make any sense.
If it had not been for the Unemployment Insurance Fund which, after a reform that everybody is denouncing across Canada, produced an annual surplus of $5 billion; if it had not been for the systematic transfer of deficit problems to the provinces; if it had not been for the economic growth of the last two years, the Minister of Finance would certainly not have reached his target for the deficit, which is 3 per cent of GDP.
It is by tampering with reality, by dipping into a fund to which it does not contribute any more-the unemployment insurance fund-by dumping its responsibilities onto the provinces and by taking into account the evolution of the economic situation only that the Minister of Finance gets to present this overall picture.
But this is no way to improve public finances. This is no way to put public finances back on the right track. There are two ways, and both involve systematic elimination of the shameful waste that we have seen for the last two and a half years. Since we have been elected, we have come to know the machinery of government. We know there is waste, we know there is duplication, we know there is a lot of overlap.
(1105)
As far as this first way of really improving public finances, the Minister of Finance announced yesterday that the fight against waste is over. This is no joke. Even in his budget plan, we see in his table on page 14 that, in the direct budget savings for 1996-97, he expects additional cuts in the government machine of 0.0; that means zero. There are no cuts this year. It is over. There is no more waste, no more duplication, no more overlap, no more fat anywhere. It is zero.
Next year, it will be 0.2; what does it mean? It means $200 million in a budget of over $150 billion. It is an insult to taxpayers in Quebec and Canada to present such a plan for reducing waste, for downsizing the cumbersome government machine. And the Minister of Finance claims to be a good manager of public finances.
Why, for example, did he not follow the suggestions of the official opposition, which asked him, among other things, to continue to make massive cuts in national defence? It is not normal that, in peace time, the armed forces still require an investment of tens of millions, even hundreds of millions of dollars in different types of war time equipment. There is talk, for example, of anti-tank missiles or ultra sophisticated equipment for submarines.
There is talk of investing in all kinds of weapons and equipment, when all experts agree that we could cut $1.5 billion from the defence budget and amend DND's mandate so as to provide for the maintenance of peacekeeping forces around the world. That is the way to make public finances healthier and more rational-common sense would also prevail.
Why did they not propose, for example-and I am sure that most taxpayers in Canada and Quebec would be agreeable-cutting the nearly $50 million allocated to the other House, to parliamentarians who doze off during the throne speech? People noticed that, too. The time has come not only to get rid of the deadwood but also to give in to official opposition demands to eliminate, once and for all, all appropriations to these people who are paid to do nothing or to sleep.
As for the ``jobs, jobs, jobs'' that were promised in the last three years, this slogan can still be heard but it is getting fainter and fainter as the months go by, for the very good reason that this
government not only did not put forward significant measures to create good, lasting jobs but also made cuts, in the finance minister's last budget, that apply to the levers or ways used to create jobs.
Let us take, for instance, the finance minister's attack on labour sponsored venture capital funds. This is incredible. The Fonds de solidarité des travailleurs du Québec, for example, works well and helps maintain 40,000 jobs. Yesterday, the finance minister decided to pull the rug out from under their feet- this also applies to the newly created CSN fund-thus undermining this instrument that is so important to Quebecers. This is not normal.
It is not normal to talk about creating jobs while at the same time undermining the basic tools used to create jobs and spread the benefits of economic growth throughout Quebec. The same goes for Canadian funds in all parts of Canada. This is what they call taking measures to promote employment? Had we known this, we would have explained to the people that when they were talking about ``jobs, jobs, jobs'', what they really meant was job cuts. That is what the government was proposing.
(1110)
Student summer employment, that too is to laugh at the face of students in Quebec and Canada. A sum of $120 million has been earmarked for student employment creation, it is true. But did you know how much money was taken away from students through transfer cuts to post-secondary education and so on? This year, the government has cut or plans to cut $150 million.
Do you know how much will be cut next year? Approximately $500 million. On the one hand, $650 million is taken away from students over two years, while, on the other hand, $120 million will be provided to create summer jobs. I can understand why they are upset and why they came out, Mr. Rebello first, to denounce the government's attitude. They are being laughed at.
Another measure designed to discourage job creation was announced yesterday in the finance minister's speech. As you know, to maintain one cent of the employees' or employers' contribution to the UI fund, the jobs of 6,000 Quebecers or Canadians have to be sacrificed.
The Minister of Finance could have announced yesterday plans to substantially reduce the unemployment insurance premiums paid by employers and employees. Instead of appropriating the UI fund surplus he could have announced that it would be used to alleviate some of the problems faced by the economy these past couple of years in creating employment. He could have come out and said: ``We will balance our budget by systematically eliminating waste and create thousands of jobs by lowering employer and employee premiums''.
Instead, premium levels remained unchanged. When we hear that this government is about jobs, never has it been more obvious
than yesterday that this government is working against the creation of the thousands of jobs our economies need, in Quebec and Canada.
Regarding the Canada social transfer, the minister announced, and immediately recanted-but it is nonetheless written on page 59 of his budget plan-that cuts would be shared among the provinces on the basis of population.
What does this mean? I will repeat it over and over again: This means that Quebec, which represents about 25 per cent of the population, will support 40 per cent of the cuts to the Canada social transfer. On page 59 of his budget plan, the minister said, and I quote: ``-each province's allocation will be further adjusted to more closely reflect its share of Canada's population''.
Solutions are thus being delayed by a few years, but the machinery is clearly on the move to have Quebec absorb 40 per cent of the cuts to be made under the social program transfer.
Yesterday, the minister told us: ``Do not worry. The issue will be discussed. Nothing is definite yet''. Well, maybe nothing is definite, but there seems to be a clear and precise intent in the budget toward making cuts based on population, and Quebec would clearly lose out if other criteria than population were applied. That is unacceptable.
Does anybody know what the cuts imposed by the federal government on the provinces will amount to this year and the next? These cuts of $2.5 billion plus $4.5 billion will total $7 billion in the next two years, and Quebec alone will lose $650 million this year, more than $1 billion next year, and 5 billion over the three following years. For the government, stabilizing public finance means offloading its deficit onto the provinces and making Quebec pay more than its fair share.
With this budget, not only harmful budgetary measures are being introduced, but principles are being trampled.
(1115)
Some struggles lasted for decades, but now the gains that were made are simply pushed aside. I am referring to the measures proposed in the budget regarding old age security and women.
The Minister of Finance decided that the progress made by Quebec and Canadian women was not important. In just three lines, he pushed aside what was gained over 50 years of hard struggle to promote gender equality and financial independence for women by making these priorities secondary issues and moral values for Quebecers and Canadians.
The minister proposes to use the family income as a criterion to determine the level of benefits to be paid to Quebec and Canadian households. This clearly penalizes women. Earlier today, I listened
to the reaction of some women. They were outraged by the fact that the government's action will set them back several decades behind.
Remember, not that long ago, when a woman had to get her husband's signature to borrow money at the bank. What difference is there between using the household income, to which the man is usually the main contributor, and the way loans were granted to women a few years ago? In terms of principles involved, it is a shame to have included such a measure in a budget.
Let us now take a look at the tax system. Yesterday, the official opposition made what I would call a small gain. Why? Because the Minister of Finance has finally understood that there were inequities in Canada's tax system, that there were all kinds of loopholes in the corporate tax system, and that, ultimately, every Quebec and Canadian taxpayer pays for the loopholes used mostly by major corporations to avoid paying their due to Revenue Canada.
After urging and pressuring the government and the Minister of Finance for two and a half years, we have finally convinced them that it is necessary to do a major clean-up in the corporate tax system, whose exemptions cost us at least $10 billion annually-and this figure is based only on the measures that are known, because we do not know the impact of just as many loopholes.
The minister has just realized that you clean up government finances not by making cuts that impact on provinces, not by making cuts in the unemployment insurance account, not by surfing on the economic conditions, but by taking action in an area which I feel is fundamental, taxation.
We see that, while he realized that, he does not really intend to do anything to remedy unfairness in the tax system. Why? For two reasons. First, he proposes to establish a working group, which he calls a technical committee on business taxation. The members of that working group will be mandated to work behind closed doors, in camera, without anybody knowing where their discussions are going and exactly what tax breaks are available to businesses-some might no longer have any justification-and the cost of these tax breaks to the public purse. If they work behind closed doors, it may be to hide a little strategy that would go like this: change two or three tax breaks; then, once two or three of them have been changed, say that nothing more can be done.
That is not what the minister was asked to do. That is not what Quebecers and Canadians expected from the finance minister. We asked for an open process, for a special parliamentary committee that would swiftly review, in the open-that is what democracy is all about- the whole range of tax breaks available to big corporations at a cost of billions of dollars to the public purse, year after year.
(1120)
This is what we wanted and what the people want. Instead of that, we are faced with a closed process, a review that will take place behind closed doors. What kind of credibility can such a review have? How can we trust it?
There is something far worse than that, however. If one looks at the membership of this working group, one realizes that it does not make any sense to have people from corporations or universities who not only have their own set agenda, but may also be in a conflict of interest because of the committee's mandate. We notice for example that one member comes from the Simon Fraser Institute, an institution not particularly well known for social-democratic leanings. It is not known to favour big business having to pay its fair share of taxes. It clearly came out in favour of cuts in social programs as the only means to get our financial house in order. Here we have a representative of that venerable institution on a committee whose mandate is to review the corporate tax system and point out to us unfair aspects of the system we can deal with so that all corporations, and not only some of them, pay their fair share. That is quite something. It certainly does not do much for the credibility of this working group.
But there is even worse than that. People from Ernst & Young and Price Waterhouse will sit on this technical committee whose mandate, I repeat, is to find out how we can close loopholes corporations and big taxpayers use to avoid tax. One of these is tax havens. For the last two years and a half, we have been decrying the tax treaties Canada has signed with countries that are considered like real tax havens, such as the Caribbean or many others. In these 11 countries, corporate income tax rates are a lot lower than ours, something like 10 per cent of the Canadian tax rate. Therefore, profits are transferred to affiliates set up in these tax havens, taxed at a much lower rate than the Canadian one, and then sent back here. These profits are not subjected to any further taxation measure. By transferring their profits and losses in this way, corporations manage to avoid paying any taxes to Revenue Canada.
Well, can you believe that the two companies I referred to earlier, Price Waterhouse and Ernst & Young, both have affiliates in countries considered as tax havens? That is unbelievable.
As the Leader of the Opposition put it so eloquently yesterday and again today, that is like inviting the fox into the henhouse, and I would even go so far as to say that it is like inviting the fox to lunch.
``Price Waterhouse, P.O. Box 3910, Nassau''. Do the hon. members want the phone number? I have it. ``Ernst & Young, Nassau, the Bahamas''. ``Ernst & Young, Gibraltar'', that is another country considered to be a tax haven. ``Ernst & Young, the Cayman Islands'', the best of all tax havens, with 28,000 companies for 30,000 people. Incredible, right? ``Ernst & Young, rue d'Italie, Geneva'', Switzerland being another famous tax haven. ``Price Waterhouse, Les Échelons Street-nothing to do with taxation echelons, as we call them in French-, Guernsey'', the British Isles; another marvellous tax haven. ``Price Waterhouse, P.
O. Box 3910, Nassau, the Bahamas'', again, I have the fax and phone numbers for those who think it might be useful.
That does not make any sense. Quebecers and Canadians are being laughed at. The minister no longer has the political will to solve the problems related to corporate income tax. He no longer has the political will to do so. This hare-brained scheme, this creation of a closed group with obvious conflicts of interests, proves it. They talk of a delay in the production of a paper, which could come out sometime by the end of the year, because it is still on the agenda. This paper will probably be released after the election.
(1125)
This reminds me of the initiative that the Minister of Finance announced last year concerning family trusts. He said: ``Yes, we will abolish some privileges associated with family trusts but only in 1999'', giving all those with millions and millions of dollars stashed in these luxury tax exemptions enough time to find other tax shelters, thus denying the government any new money, since capital will have fled by 1999 to other tax havens in order to avoid taxation.
The only tax initiative in this paper by the Minister of Finance is the creation of the Canada Revenue Commission. The only purpose of this sole initiative is to once again isolate Quebec. In his paper titled: Budget Speech, which he read to us yesterday, the finance minister told us: ``Canadians know full well that there is only one taxpayer. A number of provinces have asked us why there was not, as well, only one tax collector?''
This is the object of the Canada Revenue Commission.
Has anyone realized what we are saying in these two sentences to Quebec, which is the only Canadian province to levy its own income tax, the only one that acquired, the very hard way, since Mr. Jean Lesage, the tax autonomy that it had always wanted and that went with Quebec's distinct society?
Does the minister of Finance realize that what he is saying about the possibility of setting up a national revenue commission, combined with the provision in the speech from the throne concerning the possibility that the federal government would create a Canada-wide program in areas of exclusive provincial jurisdiction, where a majority of provinces agree, makes for a very explosive mixture? Does he realize that?
Sometimes, I wonder if the minister of Finance is aware of the impact of his budgetary policies. Ever since taking power, he has announced a whole series of measures aimed at, firstly, isolating Quebec, and secondly, further centralizing all aspects of social, economic and political life in this country.
He has announced a national securities commission, in a field of exclusive Quebec jurisdiction. No problem, let us do it! Last year, he announced Bill C-100 on financial institutions. Once again, the Bank of Canada and other federal institutions are moving in and even shoving aside institutions such as the Quebec Securities Commission or the Inspector General for Financial Institutions.
Now we are being told that it might be a good idea to do away with duplications and overlaps, and why not, while we are at it, do away as well with the tax autonomy of the Quebec government. Now that takes a lot of nerve! On top of that, he has something planned which has been in the works for about two years, and that is the implementation of a Canada-wide sales tax.
This national sales tax would be administered by the Canada Revenue Commission; as a result, if the government of Quebec decides it does not want this second version of the GST, it will be forced to accept it because it is said clearly in the speech from the throne that if a province wishes to opt out of this new national program, it could do so only if it proposed to apply exactly the same program with the same criteria or equivalences in the province.
(1130)
In other words, if the federal government decides to create a new national sales tax that is not wanted in Quebec because the Quebec government wishes to control its tax base, what goods and services to tax or not to tax, it will not be able to do so because it will be forced to accept the new tax, a majority of provinces having decided otherwise in its place. Those are the hidden intentions behind the budget speech and the orientations of the speech from the throne.
When we are talking about disguising, that is also what we mean. And it is ironic, as I said yesterday, and I will say it again today, that when it is speaking of eliminating duplications and overlaps, the federal government is not looking in its backyard, but in the provinces' backyards. That is where, in its opinion, duplications and overlaps are to be found, even in strictly provincial fields of jurisdiction. That takes the cake!
One last point on which I would like to inform the people of Quebec, and of Canada as well, is the treatment of the milk subsidy, which affects particularly Quebec's milk producers.
You will recall that, last year, the minister of Finance cut $32 million in the budget for Quebec's milk producers. While cutting $32 million in the budget for Quebec's agricultural sector, it planned to increase by $2.9 billion the credits extended to the Prairie provinces. It planned to make $32 million worth of cuts in
Quebec while increasing by $2.9 billion the credits allowed to the Prairie provinces. Such is the Canadian agricultural policy.
What the minister told us yesterday is that not only did Quebec pay more than its share while the Prairies received several billion dollars more, but also that the government has made a unilateral decision to cut all subsidies to dairy producers in Quebec and Canada. This decision affects Quebec producers in particular since approximately 47 per cent of industrial milk production subject to subsidies comes from Quebec. Strangely, this measure hurts Quebec. There are no phoney committees set up, no panels of experts who are in a position of conflict of interest and who are prejudiced. The government has decided to cut and that is all there is to it.
Do you know how much Quebec dairy producers will lose? Between $80 and $100 million. In tough times, at a time when they have to adjust to the new rules imposed by the recent World Trade Organization agreement, to the opening of the borders and to stronger competition, at a time when they have to consolidate their industry to be more competitive in a global trade environment, the government is depriving them of $100 million, and we are supposed to think that this is a good budget. That is going a bit too far.
The conclusion is the same as yesterday. I hear my Liberal colleagues who are laughing. They think that this inequity, this unfairness toward Quebec is funny.
In closing, I move the following amendment:
That the motion be amended by replacing all the words after the word ``That'' with the following:
``the budget statement by the Minister of Finance be rejected by this House because: it proposes no real job creation initiatives and does not reduce government spending, most notably the approximately $50 million appropriated annually to the Senate; it uses the Unemployment Insurance Fund surplus to reduce the budget deficit and reduces social transfers to the provinces; it undermines labour sponsored venture capital funds, such as the FTQ and CSN funds; it does not propose a transparent process for achieving genuine reform of corporate taxation, or an unequivocal determination to undertake such reform; it undermines the provinces' fiscal autonomy; it eliminates subsidies to dairy producers without offering them adequate financial compensation; it jeopardizes women's financial independence by adopting household income as the basis for determining seniors' benefits.''(1135)
[English]
The Acting Speaker (Mr. Kilger): The amendment is in order.
We now move to the next stage of debate where members will be entitled to a 20-minute intervention subject to 10 minutes of questions or comments, unless there are other indications as to whether members might be splitting their time.
Mr. Herb Grubel (Capilano-Howe Sound, Ref.): Mr. Speaker, I will be taking 10 minutes.
Mr. Speaker, do you remember a time when you had aches and pains and went to the doctor for help? He may have given you some bitter tasting medicine and assured you that you would be well in two weeks. When you left the doctor's office you probably already felt better because your worries were relieved and you knew that all would be well within a definite period of time.
Canadians feel the pain and are worried about their economic situation. There are 1.4 million of them who are unemployed. Their neighbours who work for the government are expecting a pink slip any day. The daughter graduating from university has no job yet. There is a long wait at the hospital for the operation needed by one of their relatives. There is disturbing talk about the viability of the Canada pension plan. This is only a partial list of what worries and pains Canadians in 1996.
Canadians expect their doctor, the government, to help them. They expect the budget to offer relief and hope. They were disappointed. The doctor said: ``Keep on taking the bitter medicine I prescribed for you last year. Sorry, while I think you will be all right, I cannot give you a definite date when you can stop taking the medicine and stop worrying''.
Canadians are not satisfied with the measures by the government in this budget. The measures are not adequate to restore fiscal balance within a definite time frame. The uncertainty continues as there is increasing talk about a recession, another Quebec crisis or international financial upheaval.
Just a tiny bit more medicine in the form of spending reductions in this budget would have done the trick. Canadians were ready for it. They want to get it over with. They want to get back to normal. What did they get instead? A budget that interrupts a momentum gained by last year's tough love measures.
No one believes that next year's budget leading up to an election will restore this momentum. These facts are also known to international investors. They will not give up their demand for getting at least one or two points more on Canadian bonds than they can get on U.S. bonds.
(1140 )
As a result there is no interest rate relief. High interest rates are the main obstacle to job creation. They burden Canadians with higher mortgage payments and leave them with less income to spend on consumer goods and services that would result in the hiring of more Canadians. Investors cannot afford to build those factories. The interest costs make them non-competitive in international markets.
What worries Canadians also is what a number of media reports noted. The budget signals a shift away from deficit fighting into an election mode. The traditional Liberal methods for buying votes have reappeared.
Money we do not have is being spent to help summer student employment. I feel sorry for those students when in a few years they become taxpayers and have to repay these gifts from Ottawa in full, plus an awful lot of interest on top.
Money we do not have is going into the support of high tech industries. There are pious assurances that the money goes out through recoverable loans and in partnership. Some leaders of high tech industries say they do not want such programs. They do not like having to pay general taxes so that money can be given to competitors who will make life tougher for them. They know there are plenty of venture capitalists out there who lend money to those with economically viable projects and who are large enough to spread the risk.
It is only the high tech ventures that are rejected by the private investors as being too risky that the government will support. Almost by definition, a collection of them will end up not earning enough to repay the government. This is how loans made by the government inevitably turn into subsidies.
Finally, I am on a personal crusade to point out the almost criminal injustice that is being perpetrated on future generations of Canadians. They do not have a vote in Parliament. No one in the system is representing them. They can be taxed without cost to sitting politicians.
We are passing on to the helpless future generations not just a visible debt which already requires to service it about $50 billion of interest every year or 35 per cent of current tax revenues, but we also have burdened them with the cost of services for the elderly. It has been estimated that when the bulk of baby boomers retire in 2030, young or unborn Canadians will be required to pay another $50 billion for medicare, old age security benefits and the Canada pension plan.
Only economic growth, expected to be small, will relieve them of the burden of having to pay at least 70 per cent of tax revenue on the visible and hidden debt they are inheriting. The interest of these unborn or young Canadians obviously does not carry any weight in the minds of those who designed this budget.
It may be on target, as the minister keeps on boasting, but it is also adding shamelessly $90 million a day to the visible debt. I ask the minister and his colleagues: Where is the vaunted Liberal compassion? Does it get applied only to those who can vote for them in the next election? Do the young and future generations count for naught because they cannot vote?
Let me summarize Reform's and my objection to this budget. It coasts. It is giving up momentum in the move to a balanced budget. It fails to provide a definite end to the nation's trauma and uncertainty. It delays the time we are out of the tunnel and the sun shines once more on the possibility of lower interest rates, more jobs, tax reductions and a return to the good old times when budgets are balanced. It sends the wrong message by starting the traditional Liberal spending that precedes and election. It shows no compassion for future generations. It is a bad budget for the current generation; it is a terrible one for future generations.
(1145)
I move:
That the amendment be amended by adding after the word ``Senate'' the following: ``and in particular, its impact on investor confidence results in these investors continuing to demand high interest rates on Canadian bonds, which delays economic and normal job creation'' and;
By adding after the words ``transfers to provinces'' the following: ``and in particular it does not offer Canadians a definite date within this government's mandate in which the deficit is eliminated, and in which economic growth once again would make feasible discussions about tax cuts, debt reductions and the restoration of social program spending''.The Acting Speaker (Mr. Kilger): I will take the suggested subamendment on behalf of the member for Capilano-Howe Sound under advisement. I will ask our clerk and table officers simply to verify that it is procedurally in order and I will render that decision momentarily.
Mr. Peter Milliken (Kingston and the Islands, Lib.): Mr. Speaker, the hon. member for Capilano-Howe Sound lamented and shed endless crocodile tears that the budget spent money the government did not have and thereby increased the deficit. I know that he and his party are enthusiastic at the prospect of reducing the deficit, but I did not hear in his speech anything about the proposals for cuts he would make in government spending. I know they do not like cuts in defence spending.
I would like to have the hon. member for Capilano-Howe Sound tell us where he would cut the billions of dollars required to bring the dollars into balance.
Mr. Grubel: Mr. Speaker, I thank the member for his question. Indeed it is a legitimate question.
I do not believe that in the past opposition parties have been as courageous and open as the Reform Party has been in presenting alternative budgets, even though the job to propose methods is the responsibility of the government, not the opposition. The opposition's task is to criticize, and this is our main task. As I suggested, we have done so.
I will send the member the taxpayers budget as prepared last year. In there all of the cuts are presented. I did some calculations. It would take 5 per cent out of program spending this year and next year and the sun would shine on Canadians again. We would be out of the tunnel.
From what I hear from my constituents, this is what they would like to have more than anything else. They have continued pain and uncertainty of having to take bitter pills of continuously hearing cuts already on the books and which are still coming, and yet there is no hope.
This is a budget without hope. Everything is more cuts. More cuts have been announced for 1998-99, outside of the range of the government. That is all it is. There is no hope, nothing but pain. I believe it is a strategic error to do that, on top of the fact that the government has on its books an increase in the debt of $112 billion, if all goes well, which many are questioning.
(1150)
It will be over $600 billion that we are handing to future generations. I want to know how the member opposite will face his grandchildren and tell them he has left them as a permanent gift the interest costs and amortization on $600 billion, and that he was in the House of Commons while it went from $300 billion to $600 billion.
The Acting Speaker (Mr. Kilger): Clearly a lot of members are anxious to participate in this debate, but I must now resume debate with the hon. member for Medicine Hat.
Mr. Monte Solberg (Medicine Hat, Ref.): Mr. Speaker, in the 1993 election one of the things the Liberal government did was set up expectations. It campaigned on the promise that it would create jobs, jobs, jobs. Those were the expectations it left Canadians with.
In the 1996 budget and over the previous two and a half years we have seen nothing that solves the problem of the high unemployment we have in this country.
Today we have youth unemployment of 16 per cent to 18 per cent. We have 9.5 per cent overall unemployment. That is simply unacceptable. The government has failed miserably in its promise to create jobs for Canadians.
There are many good reasons for that. One of the things Canadians were hoping for in this budget was some tax relief, some light at the end of the tunnel. There is nothing like that in this budget. This budget is simply a cipher. It is a willow wisp. There is nothing to it. It is hollow. Anything proposed is over the hill and into the next millennium.
Canadians were hoping there would be something indicating stronger social programs down the road. They have certainly talked about the mechanics of social programs as they now exist and how they would change them. There is nothing in this document that explains it all. Nothing explains where the money will come from to sustain these programs over the long haul. By continuing to add debt on to debt the government is simply weakening these programs.
The government set very high expectations. It encouraged Canadians to think positively about what would come under a Liberal government. Unfortunately it dashed those hopes in the 1996 budget. It is simply an empty document with a lot of hot air.
It want to talk specifically about some of the challenges we face and how the government has failed to deal with these issues. I have talked about jobs, higher taxes and the unsustainability of social programs as they presently are. Now I want to talk about the cause of those things, why we have those problems.
The reason we have high unemployment is not that the government has failed to come up with short term, make work job creation programs, dusted off programs from the 1970s. That is not why we failed to deal with the unemployment problem. The problem is a debt of $575 billion. That has contributed to a structural problem with unemployment. That is why we have had 11 per cent, 10 per cent, and 9 per cent unemployment over the years.
This budget has completely failed to deal with that problem.
(1155 )
The Liberals are laughing at this. It is a big joke that we have unemployment. I do not think it is a joke. I do not think that when they went door to door saying they would solve the problem they made a joke of it. They led people to believe there was something serious going on and that they would solve it.
They have failed miserably to address the problem in the budget. They have not got to the root of the problem, the huge debt of $575 billion.
The only way we can create the jobs Canadians so desperately desire is to lower taxes and interest rates. The only way to do that is to wipe out the deficit and begin to pay down the debt. They have failed completely to do that. They have added $112 billion to the debt over the course of their mandate.
Not only have they failed to meet the hopes of Canadians with respect to jobs and job creation, they have contributed to the problem. They have added unemployment and for that they will be judged very harshly.
One of the concerns Canadians have, particularly those who are job creators such as small business people, is that we have extremely high taxes. The finance minister and members opposite have been crowing that they did not raise taxes in the budget. Raising taxes should not be a standard of a budget; it should be the exemption.
We have seen 22 tax increases since the government came to power. It has added $5.9 billion to the personal debt load of Canadians. That is shameful. Is it any wonder there are record bankruptcies in Canada. Is it any wonder people are so pessimistic about the future of the country.
The budget did not address that problem. There is no mention of tax relief. The reason there is no mention of tax relief is that the only way we can have tax relief is by wiping out the deficit. The government has failed miserably to address that problem.
The government did talk about a tax of one kind, in a very innocuous way about the GST. If I remember correctly, during the election campaign hon. members opposite told Canadians they would abolish the GST. They would axe it. They would kill it.
The Deputy Prime Minister on CBC national television on October 18, 1993, a week and a half before the election, said the GST would be abolished under a Liberal government and if not she would resign. Two and a half years and three budgets later, the Deputy Prime Minister sits in her seat and smiles. She knows the government has succeeded with its ruse, at least until now.
Canadians will not forget the issue. They will not forget that promise. They are already cynical about the promises politicians make. They will be very hard on the Liberals for that promise which they have failed to keep.
Not only have they failed to keep their promise with respect to the GST, the very tax they said they hated and would abolish, one which the finance minister called a stupid and contemptible tax, but they are talking about augmenting and strengthening it. They are talking about making it a tax which would reach more goods and services. They are talking about creating a super tax which in Ontario alone, according to a recent University of Toronto study, would kill 70,000 jobs. How does that square with their commitment to create jobs? It does not square at all.
I will talk about social programs. We have a situation in Canada today in which people are fearful about not being able to collect the pensions into which they have been paying over the course of their lifetime. The government has done nothing to address that issue. It has gone the other way.
The government talks about making changes to RRSPs which would mean that Canadians could contribute only until age 69 instead of age 71 and therefore they will not be able to save as much for their retirement. On the other hand CPP is in terrible danger. That works against the principle of merit. It works against the principle of initiative, that people should look after themselves. We are working against that. Why are we doing that? It makes absolutely no sense. We are making the pension system unsustainable on the one hand but also robbing people of the ability to save for themselves on the other hand. It does not make any sense.
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Again, is it surprising that people feel pessimistic when the government does not deliver on its implied promise that somehow things would be better when the Liberals got to power.
I will conclude by saying Canadians want some hope. They want to feel optimistic about their future. This government led them on in the 1993 election by saying: ``We will provide you with jobs, jobs, jobs''. Implied in that was prosperity; implied in that was that we would have a strong social safety net. None of that is happening. Quite the contrary, it is going the other way.
In fact this budget has been a budget of irresponsibility in the sense that despite the fact the government knows that these problems sit over the heads of Canadians like a very sharp sword, it has not done a thing to deal with them.
Mr. Paul Zed (Parliamentary Secretary to Leader of the Government in the House of Commons, Lib.): Mr. Speaker, I have listened carefully to the hon. member. I was hoping perhaps he might share with us either his personal views or his party's views on a couple of specifics, namely the seniors benefit, the child support changes, the credit for infirm dependants and the charitable donation changes.
The hon. member talked about the fact that there were no issues which dealt with securing the social safety net. There are some very concrete specifics on which we would certainly like to hear from the Reform Party, particularly as they relate to seniors and young people. I would be anxious to have him respond to the specifics about what this government has proposed in this budget.
Mr. Solberg: Mr. Speaker, the hon. member has asked me to comment on the specifics. Let me comment on them as a whole first.
The government has majored on the minors with respect to these programs. It has tinkered with the mechanics of these various programs but it has not addressed the underlying problem which is that we do not have enough money to sustain these programs. That is the underlying problem.
We do not have a particular problem with the direction in which the government has moved with respect to old age security and the guaranteed income supplement. It makes some sense to us. We have applauded the government for that. We have publicly said we agree with that direction.
However to major on the minors gives people the impression that somehow the government is providing some long term sustainability for that program. That is not the case. We are simply going deeper and deeper into debt by not announcing a date by which we
will balance the budget. Therefore these programs ultimately are destined to become unsustainable.
On the question of child support payments, we have a concern about what the government has proposed. I am very concerned that by heavily taxing people who are currently getting a tax deduction for paying child support, we are going to end up driving a lot those people away from making their child support payments.
We support the idea that there should be stronger enforcement measures. There must be stronger enforcement measures. That is where the emphasis should be in our judgment. We also want to see more money end up in the hands of the children. That has got to be the idea behind this.
In what the government is setting out to do I think it is going to end up driving a lot of people who pay child support payments away from doing that. It is going to give them an incentive to skip their child support payments.
With some of the other things the hon. member has mentioned, for instance child tax credits and things like that, again the government has not got to the underlying problem. If we give somebody $120 or $10 more a month or whatever it is, that is peanuts compared to the debt the government is asking them to assume the moment they take on a job. They pay for that debt in the form of higher taxes and weakened social programs down the road. They pay for it in the form of higher interest rates. They pay for it in the form of higher unemployment. It is simply ludicrous to give them $10 in one hand and to take $10,000 from them on the other hand because of the interest on the debt.
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Although tinkering around inside the envelope of the programs is fine, unless the government deals with the underlying structural problems then it is really not doing the job it was sent here to do.
The Acting Speaker (Mr. Kilger): I would like to resolve the issue of the subamendment.
Mr. Grubel: Mr. Speaker, on a point of order. An unfortunate clerical error has been made. Would you please in our subamendment insert the word ``recovery'' after ``delays economic'' so that the passage would read ``delays economic recovery and normal job creation''. Mr. Speaker, you have it in front of you so there will not be any ambiguity.
The Acting Speaker (Mr. Kilger): I want to thank the hon. member for Capilano-Howe Sound. Is there agreement?
Some hon. members: Agreed.
The Acting Speaker (Mr. Kilger): Ultimately, the subamendment brought forward is in order.
Mr. Barry Campbell (Parliamentary Secretary to Minister of Finance, Lib.): Mr. Speaker, I am honoured to lead off the debate for the government on the 1996 federal budget and to share my perspective on how our government views fiscal policy in the context of overriding economic and social priorities. But before I do that, I want to make a number of comments.
Comments from the official opposition reflect a fundamental lack of logic, as Quebecers and other Canadians will see immediately. Perhaps it is only on the opposition benches that you can suck and blow at the same time. Let me give some examples.
We often hear people from the official opposition sounding like Reformers, complaining that we are adding to the deficit. I heard that this morning. Yet two sentences later we hear it said not to cut and certainly do not cut defence in the province of Quebec.
[Translation]
On the one hand they say the rich should pay more income tax but on the other they say it is not fair to take into account the family income, the combined income of rich people.
[English]
They cannot have it both ways. They tell us to look at the tax system. We are responding and looking at the tax system but they do not want us to include people in that consultation that do not agree with their opinion.
We hear from the third party the question of alternate budgets. Perhaps the reason that no alternate budget has been presented this year is that when Reform members presented last year's alternate budget they called for massive cuts immediately across the board and the only increase was going to be crime control and prisons. That is the kind of society they saw emerging from those cuts.
This budget is the third mile post on our government's journey to securing fiscal stability and a dynamic competitive economy, an economy that can provide the jobs Canadians need and sustain the social programs we cherish.
The plan announced yesterday consolidates and extends the actions taken in our earlier budgets. Together these implement a comprehensive strategy Canadians can believe in. This is an important point. The ultimate measure of any government's success is its credibility.
All of us here are aware of the disrespect and cynicism felt toward the political system by too many Canadians. There should be no mystery about why they feel that way. Too often they have experienced governments that seemed focused on special and narrow interests and more concerned with private and hidden agendas.
Our agenda is different. It is a public agenda to serve the interest groups that are the real heart of Canada. People who want jobs, who want medicare and social programs sustained; seniors and seniors to be, worried about their pensions; children made vulnerable by
family breakdown; students, young people looking for their first job experience; charities struggling to respond to the needs of Canadians: these are our vested interests. This budget provides them and every Canadian in every region with renewed hope for our future. We should be proud of that.
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I am also proud that our new initiatives do not violate the core commitment of getting Canada's deficit under control. We are reallocating funds to keep the trust of Canadians, not digging deeper into the pockets of besieged taxpayers.
Let me underscore our fiscal philosophy. We are tackling Canada's fiscal problem not as a narrow goal in and of itself but rather because it is a fundamental component of national growth, new jobs, economic security and sovereignty. We will keep hitting or bettering our fiscal targets again and again and again. And that is the nightmare of the third party. Our fiscal progress to date and other actions are paying off. Canada's economic fundamentals are strong.
[Translation]
So, let us begin by looking at this budget from a perspective I believe is everyone's concern: employment and economic growth.
As the minister said, the changing nature of work and the evolution of the economy are such that ``we are facing a revolution whose scope and depth rival that of the industrial revolution itself''.
Canadians know that direct job creation must come from the private sector. But it is incumbent upon the government to make sure the economic context is the best possible and favours the continuous economic growth necessary for job creation.
This requires first of all a reduction of the deficit because deficits keep interest rates much too high. High interest rates hinder investments, employment, and consumption. In a nutshell, they are an obstacle to job creation.
Deficit control requires, among other things, that we keep inflation low. This contributes to reducing pressures on interest rates and helps control the other costs of doing business. This makes Canada more competitive on foreign markets. We can also see the dividends derived from our ability to control the deficit and inflation.
Short term interest rates have diminished by three percentage points since last year's budget. This means a saving of $2,400 a year on a $100,000 mortgage.
Our increased competitiveness means a strong increase in our exports and a record exports surplus.
[English]
It is clear that our work is far from over. Much more needs to be done. Continued progress begins with further fiscal improvement and the 1996 budget delivers. With our first two budgets we established rock hard foundations. With these measures our 1995-96 and 1996-97 deficit targets bringing the deficit down to 3 per cent of GDP are secure.
The steps proposed in yesterday's budget consolidate and extend our first two budgets and further contribute to economic and financial objectives. We are maintaining our focus on reducing program spending because the debt is a problem created by government and the solution has to focus primarily in our own backyard. That is why of the cumulative fiscal actions we have taken from 1994-95 to 1998-99, a full 87 per cent have been expenditure savings.
Together the budgets will contribute $26.1 billion in savings for 1997-98. This action together with reform of employment insurance will ensure that we hit our new deficit target to reduce the deficit to 2 per cent of GDP in 1997-98. As the minister said the other day in this House: 6, 5, 4, 3, 2. When the Liberals arrived the ratio was at almost 6 per cent of GDP. We are heading toward 2 per cent and beyond. We are getting the job done in a balanced, humane, sensitive, reasonable way.
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The combined budget plans will deliver additional savings in 1998-99 of $28.9 billion. This means the deficit will continue to drop. It is very important that the debt to GDP ratio also start to fall.
Let me highlight one important fiscal measure we shall achieve.
[Translation]
It is changing financial needs-new money the government must borrow on lending markets.
When we came to power in 1993-94, the federal borrowing requirement was $30 billion. In 1997-98, thanks to our initiatives, it will only amount to $6 billion, or 0.7 per cent of the GDP. In relation to the economy, this is the lowest level since 1970, which would mean that of all central governments of the G-7, Canada would have the lowest budget variance.
[English]
There is a related issue. It is not just that the federal fiscal situation is improving. The outlook for the provinces and the territories is also improving markedly. The provincial-territorial deficit was cut to $12.6 billion in 1995-96 from its peak of $25 billion in 1992-93. That is a drop from 3.6 per cent of GDP to 1.6 per cent.
This year Canada's total government deficit should fall below the G-7 average to second lowest behind the United States. By
1997 the nation's total government deficit should be the lowest of the G-7 based on other members' current plans. I am confident that is hard fact, not rosy rhetoric. The government is making sustained fiscal progress and it is driving the opposition crazy.
However, the 1996 budget goes beyond bottom line calculations. As Liberals we know that financial reform must never be an end in itself. The steps we are taking to get our fiscal house in order are a means to an end. What is that end? It is lower interest rates and better job growth. These steps are a means to ensure that we can preserve the Canada that Canadians want.
Canada's social programs can be preserved while being fiscally responsible. The two are not mutually exclusive. The 1996 budget establishes a long term funding arrangement for the new Canada health and social transfer which was announced in last year's budget. This long term funding arrangement will be stable, predictable and sustainable.
The 1996 budget proposes a five-year legislative funding arrangement for the CHST covering the period 1998-99 through to 2002-2003. At the end of the five-year period total CHST transfers are projected to be $2.3 billion higher than 1997-98. This will mark the first time the federal government has taken action to increase the growth in these transfers since the mid-1980s, contrary to some of the things we have heard in this House which have suggested that we will continue to cut transfers forever. The government is moving in the other direction with the 1996 budget.
Most important, as part of this, framework legislation will be passed which says that cash transfers will never, ever fall below $11 billion. The cash component of the CHST will be maintained. A floor will be set. It may be above that but never below. As the minister stated yesterday, this will assure Canadians that the commitment of the national government in support of health care, post-secondary education and assistance to the poor will be intact and strong.
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Measures like these to secure social programs on a macro level are vital, but if any group deserves special focus it is young people, especially those buffeted by family breakdown. This budget speaks to them.
[Translation]
It announces a new child support system, a new strategy which is founded on the principle that children come first. First of all, according to the new system, child support payments will not be included in the income of the custodial parent for tax purposes, nor will they be deductible for the non custodial parent.
Second, the government establishes guidelines for determining levels of child support in a fairer and more consistent manner, in order to reduce conflicts between parents who separate.
[English]
There is another element of the action plan. The government will be reinvesting the anticipated revenue gains from the new tax rules in measures to benefit children.
Most Canadians agree it is time to prioritize the saving that are realized. Among other things, the working income supplement of the child tax benefit will be doubled. Beginning in July 1997, the supplement will go from a maximum of $500 to $750 and in July 1998 it will be increased further to a maximum of $1,000.
I have touched on some of the actions the budget will be taking to help children, but there is another vital component of the budget which is new support for the charitable sector.
Past budgets have emphasized the need to look to the non-profit and voluntary sectors, to recognize the fine work they do and have indicated that Canadians will be increasingly looking to the non-profit, voluntary charitable sectors when government has declining resources to do everything it might wish to do. That is why the role of charitable organizations has become more important than ever.
It is not enough for government to talk the talk, to say: ``Canadians will have to look to that sector. They do a better job in some respects than government does in any event and it has to pull back''. We have to walk the walk. We have to give that sector the tools it needs to get the job done. The 1996 budget does that. It takes an important first step in helping that sector to do more by encouraging more Canadians to be partners with charities.
It has been proposed, among other things, that the annual limit for tax assistance on charitable donations be raised from the current 20 per cent of net income to 50 per cent and to 100 per cent in the event of testamentary gifts, gifts on death. Gifts of appreciated property will also be encouraged through the measures being taken.
I want to stress that these are first steps because over the next year the government will be examining other ways to encourage charitable giving and charitable activities.
This is a budget of wide ranging and dramatic action. No single speech can fairly reflect the scope of its plans: the proposed seniors benefit, plans to boost investment and youth training in technology and trade, the measures that will help young people increase their lifetime contributions to RRSPs and tax measures to encourage sustainable development. My hon. colleagues will be addressing these other areas in detail as this debate continues.
I would like to close on the overall bottom line of this budget.
[Translation]
I think that today's budget reproduces and intensifies the positive messages contained in the speech from the throne, so as to restore hope for Canadians in key sectors.
We are continuing to restore fiscal health, an essential condition for job creation and economic growth. We are rethinking the government's role so that it better serves Canadians and the economy. We are securing the future of social programs, viable and fairer programs which help the most needy. We are investing in the future in order to provide new opportunities for Canadians in key sectors.
[English]
When we came to office three years ago, the economic challenges seemed daunting. We have taken dramatic action and as a result the economic and fiscal fundamentals in Canada are strong and improving. We will neither squander that progress nor abandon Canadians along the way.
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I urge all hon. members to support the 1996 budget and help us get on with the job of securing Canada's future.
[Translation]
Mr. Paul Crête (Kamouraska-Rivière-du-Loup, BQ): Madam Speaker, I listened attentively to my colleague's speech. Finally, he himself stressed the weakest element in the budget speech and the budget itself.
Today, we are experiencing a completely new situation in that there is economic growth, but not necessarily employment growth. When speaking of restoring hope among Canadians, we have to ask ourselves one question: Does the government have any solution that will give jobs to young people coming on the job market and to workers evicted from the work market by new technologies? Those are two categories of people who, today, cannot find a place on the job market despite the economic growth. Considering the budget's content on this aspect, it is not very promising.
I ask the hon. member: Would it not have been better if the government had sent positive messages by making an asset out of the UI fund surplus? By cutting premiums or in some other fashion, the government could have made this money available instead of using it only to cover the deficit. Is the UI fund's surplus not something that should have been addressed in the budget speech as something that could become a positive instrument?
The second element is: What message are you sending to Quebec regions for example when you make it so that the Fonds de solidarité des travailleurs-something that works, that allows capital venture investment of funds provided by workers-is less attractive under the Income Tax Act? That will certainly not help solve the job issue.
The third part of my question is this: How can the federal government simply establish what it calls a technical committee on business taxation, when time and time again for the last two years the official oppsition has been asking for a review of business taxation? After two years and a half in office all the government does is to establish a technical committee. It says that this committee will be made up of economists and taxation experts, but no one will be representing the social view so people can come and ask questions on human resource utilization.
In this society of ours, instead of being evaluated only according to the gross domestic product, why could we not be evaluated also on the way we develop all our human resources? How can we ensure that when 45 or 50-year old workers are laid off because of technical changes, they have an alternative, something to help them start another career. While there was still time before the next election to take concrete measures in favour of job creation why did the federal government not really give priority to the employment issue in this budget?
Why is the government not dealing with current issues?
[English]
Mr. Campbell: Madam Speaker, beginning with the last point on the technical committee, I thought that the opposition members wanted to study business taxation and other taxation issues. What they are saying is that they know exactly what to do right now, so let us just do it. Let us not consult with anybody who disagrees with our opinion. Let us just do what they say. We see things differently. We think Canadians want into the discussion and the process.
As for measures with respect to employment, the budget is right with those suggestions. As the opposition appears to be doing, I would not belittle the investment being made in youth. For instance, let us focus on the $315 million in budget savings which will be put into new employment opportunities specifically created for youth.
Let us not overlook, as the opposition is apparently doing, the technology partnerships Canada program which is laid out in the budget which will bring direct results to the province of Quebec. It has depended to a great extent on the previous DIP for high tech and important jobs for young people.
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Let us not overlook, as they seem to want to because they do not want to remind the House, improved funding, increased capital for the Business Development Bank of Canada and the Export Development Bank. That translates into investments and jobs.
Let us not overlook getting the fiscal fundamentals right. That will also contribute to lower interest rates and more jobs.
Mr. Jesse Flis (Parkdale-High Park, Lib.): Madam Speaker, since this is the first time I am addressing the House in this session with you in the chair, I congratulate you on the position. I know the decorum of this place will certainly improve with your excellent skills.
I congratulate the Parliamentary Secretary to the Minister of Finance on his address to the budget.
I was very pleased that he and the budget stressed the importance of protecting the rights of our children, especially the rights of children in a split marriage. Most parents, whether they live together or are separated, have the interests of their children at heart and provide support payments. However, there are always a few chronic defaulters who use children as pawns and do everything possible to delay the payments, to decrease them, et cetera.
I wonder if the parliamentary secretary could tell the House if there is anything in the budget plans to pursue chronic defaulters. It is not the other spouse who suffers; the children suffer.
I am pleased that Parliament is addressing the rights of the children.
Mr. Campbell: Madam Speaker, the budget and in particular the new child support package do contain measures with respect to enforcement.
Contrary to members of the third party who seem to feel we should look to the Income Tax Act to induce spouses to support their children, we believe that responsibility is there regardless of the Income Tax Act. We believe that parents under a court order or who have an agreement to pay certain amounts should meet those obligations. I think we all believe that parents have that obligation whether or not they have a written agreement to that effect. It is one of the fundamental principles of being a parent.
In specific terms we are proposing as part of the program to deal with chronic default, with which the hon. member was concerned, a number of features: a federal licence suspension initiative; extended searches to trace defaulters; broader powers for the diversion of federal pensions; generally supporting those ideas with enhanced consultations with the provinces. To a great extent this is a matter of provincial jurisdiction. We are working very closely with the provinces on this matter which is of interest to all Canadians.
Mr. Derek Lee (Scarborough-Rouge River, Lib.): Madam Speaker, I was looking at some economic statistics, some of which were in the budget, which indicate that in the first quarter of this year we have for the first time in some 23 years begun to turn the curve on the debt to GDP ratio.
The opposition may not believe that. It comes from the University of Toronto's policy analysis group. It is a major change in direction.
On a national accounts basis our cash borrowing needs for the year 1998 will be zero. That is a computer projection for the year 1998. That basically says we will not have to borrow any new money to finance the deficit.
I wonder whether the parliamentary secretary can confirm for us that our budget projections and the direction which the minister has taken in the budget will bring us to those computer projected goals.
Mr. Campbell: Madam Speaker, I will not comment on those specific projections because I have not seen them.
However, looking to the budget documents, taking us to 1997-98, in that year our financial requirements will be 0.7 per cent of GDP, the lowest in a long time. The debt to GDP ratio in that year will be declining. Those two ratios will continue to improve after that.
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[Translation]
Mr. Michel Gauthier (Roberval, BQ): Madam Speaker, it is always a great moment in the life of a government and in the life of politicians when a budget is introduced. It is an important moment as we can tell when we see the media bustle feverishly around the House of Commons or the Quebec National Assembly trying to see, to understand if what is going to be announced will have some impact on our lives. They try to find out if all the affirmations made some days earlier in the different media, in the newspapers-a tax on this or that-will be confirmed and if the government will once again hit the taxpayer with new taxes or increases.
In this case, I watched the media this morning and I read all the documents that the Minister of Finance tabled in the House. I worked with my hon. colleague from Saint-Hyacinthe-Bagot, who is the critic of our party on these matters, and with assistants to try to find out what the Minister of Finance had said and especially, what he had not said in his budget speech. I came to the following conclusion: either the government is short of ideas or it is preparing to call an election. We are going to discuss both scenarios.
I repeat: the government has no imagination. I know that you are going to ask me to prove it and it will be an easy task. Experts admit that they have not seen such a minor, feeble, watered-down budget tabled in the House for in a very long time. The Minister of Finance gave us some general indications on the state of the economy, on his deficit predictions, on the state of the debt. He mentioned a few small programs here and there, made some nicely put announcements, but his speech did not really respond to the need to know of parliamentarians and experts alike.
I decided to push my analysis a bit further. I looked at the documents. I took this one, The Budget Plan tabled in the House of Commons by the Minister of Finance. On page 14, we can read ``Direct budget savings''. Everybody knows, citizens asked us that, that the government's first objective is to reduce the size of the government. We absolutely must succeed in reducing the size of our governments, particularly the federal government, which is the biggest. The government must learn to withdraw, to do more with less, to reduce the size of its departments and organizations.
I tried to determine what direct savings would flow from this budget. Normally, in a budget speech like the one that was delivered yesterday, the finance minister tells us that the government will reduce its spending by three or five billion dollars. That is normally what the minister should have done, but he did not. That made me think.
I checked again and found that there will be absolutely no direct savings in the 1996-97 budget-and I use the minister's own numbers, Madam Speaker. None, and that is not much. There will be no savings in 1996-97. Zero savings, zero for the Minister of Finance. In 1997-98, the savings will reach $0.2 billion. I must come to the conclusion-and that can be checked-that the net impact of the budget on the reduction of the government's size will be nil. Zero again for the Minister of Finance.
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That shows that the government is unable to reduce its own expenditures. But you will object that according to the estimates tabled this morning by the President of the Treasury Board, there will be some budget cuts.
All these cuts result from previous budgets. As he is used to, the finance minister announced long term programs. We hear about cuts, but they will apply only next year. The cuts he talked about last year will show up this year in some departments. This year, the minister tells us that he is not cutting, which means that he considers he has finished downsizing the government. To me, that shows a considerable lack of imagination.
After realizing that he had not cut spending, I decided to find out what he himself said in praise of his budget. I checked the document giving an overview of the 1996 budget. These documents from the Minister of Finance are quite interesting. In the first section of this document, the finance minister and his government talk about ``securing our financial future''. This is interesting. What they fail to say is that we will be paying for a long time. Let me explain.
First of all, they say that the deficit will be cut to about 3 per cent of GDP, as though this 3 per cent was the ultimate objective, the philosopher's stone. Our spending will be cut to 12 per cent of GDP, which, according to the Minister of Finance, is a great achievement. So 3 per cent of GDP, 12 per cent of GDP, and then next year's goal is to bring the deficit down to 2 per cent of GDP.
I, however, looked at a different set of figures. This looked interesting. Like many others perhaps, I thought that the minister had done a terrific job and was on the right track, and then I looked at some other figures. The reality is this: Canada's debt exceeds $600 billion, or $20,000 per Canadian. This is quite something. I am not talking about 3, 2 or 15 per cent of GDP, but about the debt that we will have to pay: $600 billion, or $20,000 for every Canadian man, woman and child. Most interestingly, since this hon. Minister of Finance took the helm two and a half years ago, he has added $110 billion to the debt-as I figured out with my friend, the Bloc Quebecois' financial expert.
In the last two and a half years, this minister who brags about a budget with nothing in it has increased the debt by $110 billion, or $3,700 for every Canadian man, woman and child. Did you realize that, since the Minister of Finance took over this portfolio, he has borrowed or incurred a debt of $3,700 for every Canadian-for everyone of us in this House, for every person listening to us, for every member of our families, for each of our children and grandchildren, for everybody we know. That is a huge amount of money.
I looked at another figure that is more significant than the 12 and 3 per cent of GDP. Thirty-six cents out of every dollar we pay in taxes-and we know what a tax dollar means-go to service the debt, to assume our collective responsibility for this debt.
How can the Minister of Finance submit a budget he claims to be proud of? How can he brag and say: ``You see, we are reaching our goals''? The finance minister thinks he is a good manager who meets his targets, but his figures are meaningless for Canadians, considering that, in the last two and one half years, his government put them $110 billion deeper into debt, for a total of $600 billion, that it put an additional burden of $3,700 on each of them, bringing the total to $20,000 per capita, and that 36 cents of each dollar goes to the service of the debt.
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I decided to go a little farther in my analysis. You will understand that I was disappointed to see the state of public finances, given what we were told by our friend the Minister of Finance. So, I went a little farther. In that same brochure, which MPs will use to sell this budget, it says: ``Getting the government right''. I find this rather cute. ``Further action is being taken to define a more appropriate and effective role for the federal government''.
There is also a reference to Parliament's effectiveness. ``In the modern Canadian federation, most departments will have their
budgets cut-''. Etc., etc., etc. I checked it out. I kept searching. I certainly did my homework, Madam Speaker. I consulted a brochure tabled by the President of the Treasury Board on the role of the state.
I expected, like most Canadians I am sure, to learn that the federal government would withdraw from certain areas, given that it is involved in numerous fields that do not come under its jurisdiction, that it does not even comply with its own Constitution in that regard, that it is way too big, cumbersome and loaded down with debts, that it has difficulty making good decisions, and that it is overburdened by its bureaucracy. I would have expected the government to say that it would withdraw from certain areas. We could have expected the federal government to give back to the provinces the areas of jurisdiction that belong to them, to put an end to all the duplication and to totally abolish some of the services, which are provided by some departments that have no business providing them, and which duplicate services provided by other levels of government.
I found some real gems in this document. According to this action plan, the objectives of the federal government are to: ``strengthen our economy and economic union to ensure a prosperous country for ourselves and our children-that is so nice; enhance social solidarity in Canada-in preserving and modernizing the social union so that the caring and sharing society is truly Canada-wide in scope-this is really fine; pool our national resources to achieve common goals efficiently and effectively; protect and promote Canadian values and identity while celebrating our diversity; and defend Canada's sovereignty and speaking for Canadians collectively on the world stage''.
I found in the document a lot of principles and a lot of things that look quite trivial when you read them in a brochure like this one. However, when you know about the federal government's propensity to centralize and to interfere in areas of jurisdiction where it should not get involved, I think you are right to worry about the centralizing hidden behind all these nice principles.
So, I reread the throne speech, the budget speech, and realized something: the throne speech indicated that ``the federal government would not intervene in areas of exclusive provincial jurisdiction''. One must know the real meaning behind these words. ``The federal government would not intervene in areas of exclusive provincial jurisdiction without-''
Some hon. members: Ah.
Mr. Gauthier: ``-without the consent of the majority of the provinces''. Which means that if the majority of the provinces consent, the federal government will interfere in areas in which it has no business.
Instead of withdrawing, of minding its own business, of simplifying its machinery, the federal government has chosen to interfere still further in areas of exclusively provincial jurisdiction.
How can anyone conceive of a country where the main occupation of a government consists in seeking out areas of jurisdiction that do not belong to it, just to stir things up? To my knowledge, the only government that does so is the government in Ottawa.
Evidence of this is easy to find. We have been told of the creation of a Canadian securities commission. This is an area in which the federal government has never been involved and in which it has no business being involved, one which will require it to rehire staff, to create a structure, to duplicate what is already being done in Quebec, to complicate things. And why? In honour of what? In honour of its so-called mission, or what it thinks is its mission.
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The federal government has also announced its intention of creating a Canada revenue commission. ``It would be good if there were only one collector for all taxes in Canada''. In the course of history, not only has the federal government funded its war efforts through powers of taxation it did not originally have under the Constitution, but now as well it wants to collect taxes on behalf of all of the administrations in Canada. If this is how a government acts when it wants to cut back, to trim the fat, to mind its own business, my goodness, I wonder where we are headed. Over time, there is an increasing tendency for the government to want to poke its finger into areas where it has no business being.
Some may reply that it might be worthwhile to eliminate duplication. That could be the case, if there were only one department of revenue, one national commission. Have you noticed how the federal government is in a rush to do away with duplication if that means cornering all of the powers for itself, and how reluctant it is to return those powers to their rightful owners?
Not only is the federal government incapable of cutting its expenditures, not only is it incapable of staying within its own federal role and of leaving the jurisdictions of others alone, but on top of that it refuses to act in areas where it ought to have responsibility, employment for one. How many job creation measures-and this is another way of looking at the budget-did the Minister of Finance announce? Is the minister aware of the need to take action to create conditions that are conducive to job creation in this country?
``Jobs, jobs, jobs'', as they were saying during the election campaign. So I checked. Did the minister announce major job creation measures? Although, in the budget document, the government claims to be investing in future jobs and growth, students and their families get nothing but crumbs: $165 million over three
years. In the last budget, the minister cut student funding by half a billion dollars. Last year, they cut half a billion dollars but this year, they are investing in jobs and setting aside, for example, $165 million for students.
Have you ever seen anything like it? On the one hand, they cut millions of dollars and, on the other hand, they give away a few crumbs while bragging: ``We took action to stimulate employment. We are reallocating $315 million over three years to create new job opportunities for young people by, among other things, doubling the funds for student summer employment''. The federal government is incapable of taking action, of making changes, of supporting provincial governments adequately in their efforts to promote economic recovery, but it keeps unemployment hovering around 10 per cent in Canada and it tells us: ``We have allocated $165 million for students and their families, $315 million, over a three year period, for new job opportunities, including summer jobs''.
The government shows a total lack of vision. This is a trim down budget. There is nothing regarding what was asked of the government itself. There is nothing about stimulating the economy. The only thing this government made in recent years was to ask other governments to make an effort. Indeed, the federal government asked provincial governments to absorb part of its deficit. It asked the provinces to absorb a total of $7 billion.
It is easy for the federal government to lower its deficit when it tells the provinces: ``Look, you will no longer receive the money that you used to get from us''. So much for that. This means a shortfall of $7 billion for the provinces. It also means $5 billion less each year in the UI fund. It is easy to tell the unemployed: ``Listen, there is a surplus of money in your fund, even though the government does not contribute one penny to that fund. That surplus of $5 billion per year comes from your own contributions and those of your employers. Nevertheless, we want to put that money in our pockets. This is part of the federal government's budgetary effort''.
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Some $7 billion less for the provinces and about $5 billion taken every year from the UI fund. And the Minister of Finance tells us that these cuts will be maintained over a number of years. The minister says: ``Look at how good I am. I reached my objectives. I am a remarkable administrator and, in addition to all that, I also injected a few million dollars into the employment sector. Let us hear it for me, after all I am the best finance minister this country has ever had
We are not fooled by the message that was delivered to us. The Minister of Finance has tried to disguise the bad news for the unemployed and for the women who will lose their financial autonomy when they reach retirement age, as a result of the changes the minister wants to make in a few years in the old age security program. So, bad news for the unemployed, for women, for young people too, who will be bearing the brunt of the sizeable cuts imposed upon them by the minister, despite the few millions announced. Bad news for those who were hoping the federal government would finally learn to mind its own business and stay within its own areas of jurisdiction. Bad news, too, for those who had hopes that the government would finally trim some of the fat and become more productive.
In short, this budget reflects one of two things: either the minister has totally run out of new ideas, no longer knows what to do, is running out of energy, sees himself as unable to do more and is settling for apologies about what he has done in his time as minister, or the government is getting ready to go to the people and is trying to butter them up a bit, to use a bit of subterfuge, to say ``Well now, things may not be all that great, but neither are we all that bad a government after all''.
Before I close, let me say that the people are not fools. We will never be able to accept a government that has put us into debt to the tune of some $3,700 per person in the past two and a half years still wants to invade areas of jurisdiction that do not belong to it, nor will we accept its refusal to trim the fat as it should, or that it is now coming to us with the explanation that the provincial governments need to do their part, need to reduce their deficits, need to assume the federal deficit, in short that it wants to direct things on behalf of everyone within the Canadian federation.
I will be frank: Quebecers cannot accept such a budget. It is a cosmetic budget, one hiding the truth, one which may help the Minister of Finance and his government to hold on for a few more months, but it does not address the underlying problem. It does not address Canada's true financial situation, which is a disaster from all points of view. I believe that people have more respect for those who have courage and who know how to call things by their right name than those who try to disguise them with politics. This is a lesson the Minister of Finance ought to take to heart.
[English]
Mr. Bernie Collins (Souris-Moose Mountain, Lib.): Madam Speaker, it is a pleasure to speak in the debate on the budget presented by the Minister of Finance. It contains measures to satisfy the main concerns that I brought forward on behalf of my constituents.
I would like to take a moment to go through some of the concerns of the constituents of Souris-Moose Mountain. Interest rates affect everything we do. Even a 1 per cent increase can mean a great deal to homeowners, farmers, those who wish to purchase machinery and to the mining companies if they are looking to expand their staffs or their businesses. Interest rates have come down over 3 percentage points since 1995.
The act of keeping our fiscal house in order and doing it in a rational and balanced way is paying off. A lower deficit means lower interest rates, growing confidence in new investments leading to more jobs and growth. That means jobs for young people as
well. For us in Souris-Moose Mountain it offers an opportunity for hope.
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This budget offers a framework for that opportunity. We are encouraging education for young people, increasing tax benefits for students to allow them to continue, using summer employment as a mechanism.
Jobs will also continue to come from increased trade. That will continue to be a priority of this government.
One other thing that businesses in my area are concerned about is taxes. I am pleased to say we have set up a special technical committee to review the tax system to make it simpler and more effective. One more thing businesses are pleased with, and several phoned me last night, is we will make sure that banks do not enter into the insurance and the car leasing businesses. I am happy to announce that we have stayed the course and we recognize their concerns.
My constituents told me: ``Do not raise taxes''. I can tell them there are no tax increases in this budget. There have been no personal tax rate increases in any of the three budgets since we were elected as the government.
We continue to meet our deficit targets and to restore faith in our fiscal management through getting government right: reducing overlap, reducing waste and setting priorities that Canadians want.
Another thing that is extremely important to my constituents is security for families now and in the future. That is why all of these actions in the budget are very positive for stability and sustainability. We want our programs to still be there for our children.
In this budget we are acting now to ensure that social programs are affordable and will be there for Canadians in the future. We will restore growth to transfers to provinces and we will secure stable and growing funding for health, post-secondary education and social assistance.
Let us examine for a moment the Saskatchewan situation. The CHST transfer to Saskatchewan will increase $50 million over the next five years. From the years 1998 to 2003 we will maintain that base level. As well, Saskatchewan will of course continue to benefit from equalization.
Following consultations with the provinces, this budget put the CHST on a secure footing. There will be no further cuts to the CHST. It sets out new five year funding arrangements in which transfers are maintained and then grow.
Also important to Saskatchewan is the federal equalization payments because they will grow also. There are arrangements to safeguard medicare, which is very important in Saskatchewan, and our social programs, and restores stability and predictability for provincial governments.
This is the first time since the mid-1980s that the federal government has taken action to increase growth in these transfers. Our fiscal discipline is paying off. Getting our house in order and setting priorities has allowed us to now budget in growth in spending in the areas that count.
Speaking of these changes, many constituents have been asking since the time I was elected to do something about the taxation of child support payments. It is now done. As of May 1, 1997 child support will be paid but will not be included in the income of recipients for tax purposes, nor will it be tax deductible for the payer. This is only part of the child support package which puts the emphasis where it belongs, on the welfare of the child.
Many seniors have asked us to address their concerns with security for their grandchildren and security for themselves. I am pleased to see a new tax free benefit for seniors that will replace the old OAS and GIS benefits and will secure and ensure the long term stability and sustainability for seniors' pensions.
These seniors benefits will help those who need it most while streamlining the program. It will make the system fairer. It will guarantee that all current seniors, in fact all those who are over 60 years of age now, will receive no less than the current pension benefits. Most people will receive the same or more money under this system.
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We in Souris-Moose Mountain in the rural agricultural area of southeast Saskatchewan are heavily dependent on agriculture. These actions have a large impact upon us. As well, we endure many restrictions due to our rural nature. We must overcome distance and resource barriers to be able to contribute to the economy and support ourselves adequately.
This budget builds on actions in the last two years that laid the foundation for changes in the west. Spending reductions, elimination of waste and overlap made room for spending in research, adaptation initiatives and trade. We need to see a continued focus in these areas laying the infrastructure or framework for a new revitalized agricultural sector.
Subsidies have been eliminated and change is upon us. We need adjustment assistance for this major change. And so it has been delivered. This budget will see the time frame accelerated for distributing $300 million in the western grain transportation adjustment fund and $72.6 million under the feed freight assistance adjustment fund.
Just this morning I spoke to the president of the Saskatchewan Association of Rural Municipalities, Sinc Harrison. He said how pleased he was that the government is moving quickly to put money into the hands of rural governments in a faster and fairer manner.
Adaptation support is needed. And so our government delivers again. Direct producer delivery mechanisms for federal funding will set up adaptations and rural development funds and other adjustment initiatives.
We continue to consult with producers and other stakeholders toward a more efficient grain handling and transportation system. We will be selling 13,000 hopper cars. We will continue to discuss with producers the most efficient way of doing this.
This is the kind of budget my constituents have asked for. It is fairer across the board. It deals with all regions of Canada. It secures a future for us both fiscally and socially.
As I travelled throughout my riding, constituents raised concerns. They did not want a fuel tax because we travel such a large area. There was no fuel tax. Others wanted streamlining. The minister has streamlined to make the Government of Canada run more efficiently.
I have had the opportunity to talk about youth employment programs. I talked to the mayor and some councillors in Broadview. They were really impressed with our youth employment program. I am glad to see we are going to double the youth employment program this summer to meet the needs of those students who want to go on to post-secondary education.
In summary, let me say I am happy to be one of Team Canada's players. In a country as diverse as ours, it is a real privilege for each of us to be able to be part of a team that sets objectives and goals and meets them. We do not just talk about them; we meet them. We have set the challenges for the years to come. I know through our Minister of Finance and all who are involved we will meet those challenges.
[Translation]
Mr. Ghislain Lebel (Chambly, BQ): Madam Speaker, I listened attentively to the remarks by the member who just spoke and I am tempted to ask him the following question: ``Could it be that his political partisanship is making him totally blind?''
When comments are made on a budget as important as the one tabled yesterday, people have the right to know what it will cost them, what awaits them, what are the risks in job terms, what about their own jobs, how big is the debt. The Minister of Finance talks of 2 per cent of the GDP, 3 per cent of the GDP and 15 per cent of the GDP.
Mr. Duhamel: Of course, one must understand.
Mr. Lebel: Would you be please quiet. It is a bit as if I took the minister's hat size, divided by his shoe size, less his waist size and said: ``There is the amount of your debt''. If he puts on weight, it does not work anymore. The same is true for the GDP.
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We want Canadians to know that they are in debt to the tune of $20,000 each, babies born this morning arrive with a $20,000 debt. In the past two years, we have added $3,700 to their debt load and to that of those who are not yet born, but are on the way.
I do not think we can close our eyes. The government appears to be acting like a windsurfer who has just come off a great big wave and is on the flat part of the wave. He is turned sideways and is getting ready for the next wave, whenever and however it comes.
This is what a budget plan is. You have to invent, think of the next wave. Right now we are talking about 10 per cent unemployment. Some 400,000 workers in Quebec alone were added to the welfare rolls last year. They are not considered unemployed anymore, and our statistics are therefore lower. But there are people who are not eating or eating very little. The member, with every good intention, I am sure, refuses to see the data of the problem.
My question is as follows: Does the budget tabled by the Minister of Finance meet his expectations? Is he ready for the next wave? He has not convinced me that he is.
[English]
Mr. Collins: Madam Speaker, it is a pleasure to respond to the series of ramblings by my friend from the Bloc.
I certainly do know what it is like for young people. Having eight children and ten grandchildren, I know what they are going to face as they come into the challenges of the future.
What we have done as a Team Canada approach is we have said that we want to lead. When we came in as government there were a series of things we had to do. We had to set some targets. We set those targets and surpassed them. If the member wants to review those I think he should. Let us put them in factual order and see what has happened with this government over the years we have been here. The member may be well advised to check with the new premier of Quebec to see what he will do with the challenge that faces him as the premier of that province.
Yes, it is not easy. No, I do not like to see those who face unemployment. On the other hand, I do say that the task we have been dealt is a serious one and one we do not take lightly. We will continue to set the goals and objectives, whether it is for the youth, the old, or the unemployed. They will know this government is committed to meeting those challenges. They will know that as they come into the workforce there will be a job. If the member had only followed Team Canada he would know that for every billion
dollars of new funds we were able to create in the way of exchange 11,000 new jobs will come into the Canadian economy.
There is a reality there and the member has to address it. Perhaps once he has done that, he will agree with us and will be more than happy to support this budget and the work of the Minister of Finance.
Mrs. Rose-Marie Ur (Lambton-Middlesex, Lib.): Madam Speaker, I would like to address a question to my hon. colleague who spoke most eloquently. It is with respect to the youth and seniors in his rural riding.
In the budget last night there was the community access component of the SchoolNet. He and I both share a rural riding so I know how important the low cost initiative aimed at helping 1,000 rural communities to participate in this knowledge based economy is to my hon. colleague. I would like my hon. colleague to explain to us how this will affect his riding and how beneficial it will be to youth.
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Mr. Collins: Madam Speaker, it is a very important topic for us in rural ridings whether in Ontario, Saskatchewan, New Brunswick, Manitoba or Prince Edward Island. We have to ensure those people in the rural areas will be part of this whole country.
Through this program I am pleased to see that seven of those Internet arrangements were allowed to come into my riding. Now a series of others want to get on to it because it is a program that brings us in very close contact with one another. It provides us with vehicles through the communication network we did not have before. This brings us together because we have distance barriers of rural ridings. It allows us to communicate almost instantly.
In the agricultural sector I have grain farmers who are so excited that they can now use this as a basis for communication worldwide on almost an instantaneous arrangement.
I thank the member for the question. It is a very important aspect of our whole budget proposal and it will take us forward into the next century.
[Translation]
Mr. Ronald J. Duhamel (St. Boniface, Lib.): Madam Speaker, it is now my turn to talk about the budget and I am doing it with great pleasure.
I would like to start by congratulating my colleague from Souris-Moose Mountain on his speech, which I found quite eloquent and which helped clarify the content of the budget.
Here we go again, as you probably noticed. The opposition parties are saying all kinds of nasty things on the budget. What is interesting is that it is not at all what is being reported by the media. What are people with no political connection saying? Let me share it with you.
Earlier, you heard the Reform Party members and their magical solutions, simple solutions to complex problems; such is their political platform. I am looking forward to seeing what kind of solutions the nearly defunct New Democratic Party is going to offer. What could the Progressive Conservative Party have to say, it is already extinct.
What concerns me is that the Bloc has already started to spread information; in a little while, I will read a quote showing what I mean. Let us look at what today's papers are saying.
Le Devoir: No tax increase in Martin's budget. The Bloc and the Reform do not like this, but Canadian people do. Le Droit says it is a good budget. We read in La Presse: ``What the Minister of Finance is telling us is that it is quite possible to wrestle the deficit and yet remain compassionate; he is also telling us that fiscal responsibility is possible without an abrupt change in direction, contrary to what we have witnessed in Alberta and Ontario.'' This is what La Presse is saying.
[English]
The Ottawa Citizen said: ``The budget is a compromise between relief and austerity''. The Winnipeg Free Press said: ``Budget Boosts Buck'' and ``Blueprint Encourages Economists''.
[Translation]
La Presse: ``$480 million for young people''.
[English]
The Financial Post said: ``Old and young to reap rewards from continued program spending cuts''. The Globe and Mail said: ``Education, Jobs to Receive Boost'' and ``Students, Families Get Relief from Taxes''.
[Translation]
This is what the media are saying. The vast majority are praising the budget. They are saying, with great eloquence, that the Minister of Finance gave us a budget that answers the needs of Canadians; they are saying that he listened and responded.
But what happened to the Bloc? They used part of a quote that I will repeat for you: ``The government will not use its spending power to create new shared-cost programs in areas of exclusive provincial jurisdiction without the consent of a majority of the provinces''. They stopped there. But that was not the end of the paragraph, the rest said: ``Any new programs will be designed so that non-participating provinces will be compensated, provided they establish equivalent or comparable initiatives''.
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Why did the Bloc use only half of the quote? Obviously because it does not want it to work. This is regrettable because the Bloc ought to have been perfectly frank, totally honest and open.
Now, I am going to talk about the four main themes of the budget. The budget of Canadians: securing their financial future in a number of key areas; reaching or exceeding financial objectives; consistently reducing program spending. There is much information proving it is being done. We are going to rethink the role of government. We will take measures to determine a more appropriate role in the context of a modern federation economy. We will guarantee the future of our social programs, restore trust in the old age security system by providing long term sustainability, and guarantee the security and stability of federal support for health care, postsecondary education and welfare. We will also invest in the future, reallocate funds to make new investments, provide help for young people and support technology and international trade. These are essential areas for job creation and future growth.
I would like to be more specific on some of these points. I will talk first about the investments in our future as they are described in our budget, but before that, there are some details we must remember and repeat. There are no new taxes.
[English]
There is $2 million in additional government expenditure reductions. This marks the point at which the Canadian economy begins to gain on the accumulated debt. This is a historic, meaningful and significant happening.
[Translation]
There will be investments in our future. To ensure our future and restore the confidence of Canadians, job creation and financial growth are a priority in the budget; the government has allocated resources to new investments in three main areas: youth, technology and external trade.
[English]
Action in these fields is not an increase in expenditure but is financed by budget savings through reallocations from lower priorities. Government cannot solve Canada's problems by simply throwing massive sums of public money at them. This is what has created our difficulties in the past. Instead, we must create an economic and social environment which will encourage the economic growth that makes sustainable new jobs possible.
There is still much work to do, unemployment and youth employment in particular. Therefore taking a collaborative partnership oriented approach to building an environment propitious to economic growth and employment is of utmost importance. We need low inflation, low interest rates and declining deficits because these are all critical to the future of our nation, to the future of Canada.
Let me talk for a moment about youth. Most of us will know that the unemployment of youth, those under 25, is very high; it is in the neighbourhood of 16 per cent. This therefore needs to be addressed. They are the key to our future and we must never forget that. We need to enhance the educational opportunities that will lead to jobs. We must help young people get their first jobs. In that objective I applaud the government for asking profitable businesses to reach out and do exactly that.
[Translation]
It is a very commendable initiative and I see some colleagues in the opposition parties nodding; no doubt it means they agree. I am very happy to see that agreement because it does not happen often enough here.
[English]
Let us talk about the learning package. There is an additional $165 million in tax assistance to students and their families over three years. There is 25 per cent in educational tax credits and tuition fee limits.
[Translation]
The ceiling on annual contributions to an education savings plan has been raised. Some help is given to low-income parents living alone in the form of a tax deduction for child care; there is also help for secondary school students; that is a new initiative.
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Two-parent families are also eligible for the deduction if both parents are full time students. The current age limit for the deduction will be raised from 14 to 16.
[English]
There is $315 million dollars for new employment opportunities.
[Translation]
Seven hundred million dollars are already provided through such programs as Youth Internship Canada, Youth Service Canada and summer job programs.
We will double government commitment to summer job programs, from $60 million to $120 million. With these $60 million we created 30,000 jobs, so we hope to double this number. The remaining funds will be used to improve job possibilities for young people in innovative sectors: information technology, environmental technology, tourism, culture, trade and international development.
[English]
These investments will build on a new domestic Team Canada style partnership between business and governments to create entry level jobs for youth.
[Translation]
With these new funds, $315 million reallocated and $165 million in tax expenditures, the budget brings total expenditures for youth-specific programs over a three year period from $700 million to $1.2 billion.
I conclude by saying that I could have gone on for another two hours. I am sure that had I seeked unanimous consent of the House the answer would have been yes.
Mr. Maurice Bernier (Mégantic-Compton-Stanstead, BQ): Madam Speaker, since this is my first speech since you became Acting Speaker, I wish to congratulate you on your appointment.
I would like to share my colleague from St. Boniface's optimism regarding the budget. Unfortunately, like all government members, our colleague from St. Boniface merely watched the finance minister's show in this House yesterday and let himself be hypnotized by the minister's oratorical performance.
What government members failed to do is read between the lines; it is one thing to listen to or read the budget speech and quite another to appreciate or analyze the impact of this budget.
I will take the hon. member for St. Boniface's own example, because I want to give him the chance to repent and perhaps correct what he said in this House a few minutes ago-I will take his own example, student assistance. I will get to my question in a minute if you allow me to continue.
Regarding student assistance, the hon. member reminded us that the budget sets aside $375 million over three years for student summer employment. This is a panacea, the find of the century.
The hon. member fails to mention that, as a result of the cuts to the Canada social transfer that were announced last year, which for Quebec alone amounted to $600 million last year and $1.2 billion for the coming year, Quebec's finance minister will probably have to raise tuition fees by a significant amount.
The few additional jobs that will be created for our students-and I am happy for them-will not be enough to compensate for the increase in tuition fees. That is one consequence of this budget.
I could go on for several minutes on this, but I will give the hon. member for St. Boniface a chance to immediately repent in this House in front of all his colleagues. I will get back to this later.
Mr. Duhamel: Madam Speaker, I thank the hon. member for his comments and his question. I would have thought that the first thing he would have done was to explain why the leader of his party quoted only half a paragraph.
It troubled me. If the whole paragraph had been quoted, it would have been obvious that that section deals with trying to meet the needs of all provinces, including Quebec. This worries me a little.
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He chose to remain silent, so bet it. But I was also surprised to realize that the hon. member is incredibly pessimistic. Since the budget speech yesterday, we hear all sorts of comments everywhere. The only people opposed are members of the opposition parties. I thought such pessimism was exclusive to Reform members, but I see that it is contagious and that Bloc members have caught it. How unfortunate.
How can the hon. member say that the $700 million to which nearly $500 million has been added, totalling $1,2 billion, does not provide significant help for students? This is really sad.
Moreover, as far as cash transfers are concerned, there is a figure of $25 billion, that will be increased to more than $27 billion. That is a lot of money.
Really, the hon. member looked at only a line or two on one page, and he is using that as the whole basis for his argument. One must look at the whole picture. Optimism and understanding are in order.
[English]
Mr. Jay Hill (Prince George-Peace River, Ref.): Madam Speaker, I will be splitting my time with the hon. member for North Vancouver.
I was encouraged to hear that the government has listened to what the Reform Party and many Canadians have been saying all along: Do not raise taxes. However, when the Minister of Finance said that he was staying on course and maintaining the current pace, he may as well have been referring to the reckless spending going on in some areas under the guise of regional and economic development.
We have heard the old rhetoric about the need to eliminate overlap and duplication, yet a slew of government offices are still subsidizing private business with taxpayers' money. Various federal agencies are competing with each other and with provincial bodies for the same client and fighting over which can spend the most tax dollars the fastest. There could be nothing more ridiculous.
The government has talked about eliminating direct loans to businesses. What does that matter if it is still dishing out indirect subsidies? It is just a play on words. The government has no business trying to manipulate the private sector. Not only is this grossly distorting the marketplace, it is creating unfair competition among businesses. It is helping some businesses at the expense of others. The government is propping up the economy and creating a
system of corporate welfare. The government is trying to give us a false sense of security and it is costing us big time.
For example, an audit revealed that 17 failed projects supported by the Atlantic Canada Opportunities Agency have cost Canadians nearly $100 million in grants, loans and loan guarantees. This is just one of many examples of wasted money. As if this pill could get any harder to swallow, the auditors concluded that a good look at the failed business plans would have indicated they simply were not viable.
Government spending entities such as ACOA, western economic diversification and others are actually hurting the people they are supposed to help. Atlantic Canadians pay taxes too. ACOA has put Canadians further into debt. Regional development agencies are nothing but a front for wasting billions of tax dollars on political pork barrelling and patronage.
It is no coincidence that Winnipeg received a disproportionate amount of WED dollars. The WED minister, the member for Winnipeg South Centre, became the patronage saint of pork barrelling after his hometown received a disproportionate amount of WED funding between November 1993 and November 1994. That city received more than $12 million. The next highest was Vancouver. Despite its larger population it received just over $2 million. Calgary and Edmonton combined received just over $3 million. There was also the outrageous patronage in Atlantic Canada during the last ACOA minister's reign.
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The government cannot continue its reckless spending to buy taxpayer votes using its own money. Regional development agencies must be eliminated as soon as possible. The savings will put a significant dent in our $600 billion debt.
Consider also the senseless waste of money through administrative and overhead costs of WED, ACOA, the federal economic development initiative in northern Ontario and the Federal Office of Regional Development in Quebec. For example, WED has an annual budget of about $478 million.
Add to that list numerous other organizations that grant loans and waste government money. There is the Business Development Bank of Canada, the business development centres, aboriginal business programs, business service centres, women's enterprises centres, community futures offices and others. On top of that the provinces have their own economic development initiatives. These various offices are competing for the same client. They are all funded from the same source, the same taxpayers. These organizations report to different people in different governments.
Ultimately the government's right arm has no idea what the left arm is doing. We have a number of players involved in one game: handing out government money. Too many cooks are spoiling the broth. The pot is already bubbling over with debt. It is rising at $95 million per day and $1,000 per second.
In many cases these organizations refuse to release details of their dealings in the interest of client confidentiality. They are not accountable to those who foot the bill: the public. Canadians get angry when they hear of their money being used to fund businesses that are competing with others. There is the potential for one government funded business to push another publicly funded business into bankruptcy and render it unable to repay its government loan.
It has been argued that giving the private sector a boost benefits Canadians in the long run because it fosters private sector job creation and diversifies local economies. That is rarely the case. It has also been said that even the businesses that fail benefit Canadians by taking people off the welfare rolls temporarily. This is misleading. In reality, while some businesses are temporarily up and running, others are thrown off kilter.
ACOA reported to Parliament that it had created 42,000 jobs between 1988 and 1992 but could not back that claim with any evidence except a Price Waterhouse study of which officials refused to release details. An audit found the agency had based some of its success statistics on proposals rather than on results. There certainly has been a lack of consistent monitoring of long term results by the regional development agencies. Simplifying the tax system to encourage private sector job creation would have been a much healthier way to go.
ACOA has a long history of reckless spending. For example in 1990 it invested $13 million in a wallpaper company that failed, then later paid its loans and the bills to clean up the hazardous waste it left behind.
Why do large firms that rake in billions of dollars in profits receive government handouts? Between 1992 and 1994 federal aid to large corporations included a $200,000 grant to IBM for employee training and nearly $76 million to Pratt & Whitney Canada for research and development. Multimillion dollar companies do not require scarce tax dollars. WED handed out nearly $280,000 between November 1993 and October 1994 to lobby groups, some of which lobby against the government.
The government's priorities are mixed up. It would rather invest half a million dollars in a Newfoundland golf course when the people of Goose Bay, Labrador are still waiting for a decent road to connect them with the rest of the country. That is not regional development. Regional development entities and other money agencies are supposed to be lenders of last resort. That does not mean giving money out to anyone who asks.
Hagensborg Marine Farms Ltd., a project to build the first land based fish farm on the west coast went into receivership in 1991. The more than $1 million it received from WED is lost forever. Altero Technologies Inc. borrowed $475,000 to produce exercise
machines. The company went out of business and the loan was written off. These are just two of many examples.
It is more tempting for entrepreneurs to launch themselves into risky business ventures when it is other people's money that is at stake and with loans that can be written off. Certainly there are some cases in which it may be beneficial for the private sector to be able to turn to government as a lender of last resort. However, there is a much better way to do it without the tremendous waste of money that has been going on in the past.
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First, there should be only one money lending agency reporting to one minister and it should eventually be self-sufficient. That is, the interest it makes off loans would be used to cover its operating costs.
It should not be a slush fund for politicians to dole out cash to favoured individuals. Borrowers would have to meet certain criteria, including presenting a viable business plan. National standards must be established. Any duplication with the provinces must be eliminated. Any Canadian needing business help will appreciate a one stop shopping office rather than getting the government runaround.
Money lending decisions must be taken out of the hands of patronage minded politicians and distant bureaucrats. Decisions must be made at the local level by a board of business people with proven track records. This would help ensure decisions are made with a community's or region's best interests at heart. Perhaps the community futures program could be used as a model since this program has been quite successful in some provinces.
All decisions must be open to public scrutiny. Private banks scrutinize and monitor their borrowers. Why would the public expect any less with its money? If this government is really serious about boosting the economy, it will do so by fostering a good business environment. However, that does not mean giving away free money because there is no such thing. It means eliminating the deficit, lowering the barriers to trade, reducing taxes, lowering real interest rates and enhancing labour mobility.
Taxpayers want real action, not the pork barrel of false promises we have been getting in the past.
Mr. Réginald Bélair (Cochrane-Superior, Lib.): Madam Speaker, it is with great interest that I have been listening to the speech that was just given by the member for Prince George-Peace River. I stopped paying attention to the member's speech in his reference to ACOA. For the two years the Reform Party has been here, time after time its members have debased ACOA. He also touched on FedNor which affects my region of northern Ontario. We all know these economic development agencies are there to spur the economy and growth and to create jobs.
Western diversification has also created thousands of jobs. I want the hon. member on behalf of his party to tell us whether he is willing to totally scrap western diversification, the dollars that come along with it, the jobs that have been created and the economic growth that has been created. We noticed that Reformers never talk about it. I want him to come clean and answer a specific question.
Mr. Hill (Prince George-Peace River): Madam Speaker, the short answer would be yes we are. We have talked as much about WED as we have about ACOA. Therefore, I dispute what the hon. member is saying. We have talked about all the regional development agencies and we say it has to end.
This government talks about balancing the budget. It wants to move toward a balanced budget. It is always asking for new ways in which to bring down government spending. We have been consistent in condemning these types of ridiculous loans to business.
Mr. Bélair: Say the number of jobs that are going to be lost.
Mr. Hill (Prince George-Peace River): Say the number of jobs that are going to be lost. There is absolutely no accountability for these agencies. There never has been and there never will be as long as they continue to be run the way they have.
We have seen a tremendous growth in the amount of dollars spent on these agencies over the last few years. In 1991-92 WED, since that is the particular agency the hon. member is directing his attention to, had a little over $185 million to dole out. In 1995-96, our current year which is coming to an end at the end of March, it had almost $500 million to dole out, yet we have not seen the positive effect of that. There is so much money taken up in the administrative costs of running these programs they actually kill jobs, not create them.
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Mr. Joe McGuire (Egmont, Lib.): Madam Speaker, the hon. member alluded to Labrador during his speech. Maybe we should send a copy of it to the constituents in Labrador.
I wonder what the Reform Party is telling the people of Labrador about the unemployment insurance system. Is it telling them that the unemployment insurance system should be eliminated? Is it saying that ACOA should be eliminated? Ninety per cent of ACOA supported businesses are successful in that area. Is it telling the people of Labrador that it would like to reduce the Marine Atlantic program? Is it telling them it is in favour of a two-tier medical system?
I would like the hon. member to respond to what the Reform Party is telling the people of Labrador.
Mr. Hill (Prince George-Peace River): Madam Speaker, I was recently in Labrador. While I was there I met with representatives of ACOA, representatives of the business development centres, and I talked to them about the problem. The most frustrated people are the people inside the system. They see the huge waste of tax dollars. They are also taxpayers. It has to end.
Perhaps after March 25 we will have a member representing Labrador over here who will be truly representing those people for the first time in a long while.
Mr. Ted White (North Vancouver, Ref.): Madam Speaker, after studying the finance minister's budget I could just about give last year's speech. We are still on the debt and deficit treadmill and nothing much has changed.
The one good piece of news is that last weekend it seems that the Deputy Prime Minister went through some sort of fiscal conversion. I heard her on ``Ottawa Inside Out''. She said that a dollar invested by the private sector in jobs was a dollar going a lot further than one put into job creation by the government.
Most people in Canada instinctively know this is true. The Reform Party has been saying so at public meetings and in its election brochures since 1989. A dollar left in the hands of an investor, a business person, a consumer or a taxpayer will be much more productive in the economy than that same dollar in the hands of politicians.
The Deputy Prime Minister now realizes that the Liberal $6 billion infrastructure program was a complete waste of money. It did not create a single job, just like we told her. The Prime Minister's solutions of 30 years ago simply do not work.
Business has told the government how to create jobs: stop running deficits and reduce taxes. The resulting flow of money back into the hands of consumers and taxpayers will guarantee generous job creation from increased demand and new investment.
It is not really a hard concept to grasp. However, instead of doing what is required, the Minister of Finance has chosen to keep us on the treadmill of deficit and debt, exceeding $30 billion per year for the deficit and a debt which is now approaching $600 billion, with enormous interest payments of almost $50 billion per year on that debt.
In the time that it takes me to give this short speech the government will have overspent by another million dollars. As long as there is no swift action to really balance the budget and to begin running surpluses, taxes are certain to increase, the debt will continue to grow and interest payments will get larger.
It certainly does not take a rocket scientist to calculate that the cancer of interest payments will within a few short years completely consume our social programs and virtually wipe out every government service which is offered today.
Since the end of 1993 the Liberal government has added almost $90 billion to the national debt and, as a result, almost $10 billion in interest payments. That extra $10 billion per year has to be cut out of government services before we make one step forward in reducing the overall deficit.
Are sensible decisions being made about spending cuts? Absolutely not. There are major areas of waste not properly dealt with in the budget, such as the massive Indian affairs budget which is forecast to expand by 15 per cent over the next three years while services to other Canadians are being reduced by up to 70 per cent.
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There is the excessive and unwanted spending on multiculturalism and grants to all manner of special interests and businesses. The government also fails to exhibit any will to control incremental spending waste, the little things that together add up to billions of dollars.
For example, a few days ago I received in the mail a certificate from the minister of heritage. It was beautifully printed, multiple colours with gold ribbon on it. It said: ``Canada Day Certificate of Merit: Awarded to the Hon. Ted White in recognition of your contribution to Canada Day 1995''. The award was signed by the minister of heritage. When I showed that certificate to a number of people in my riding I had comments like: ``What sort of pea-brained, cerebrally challenged idiot would approve the expenditure of tax dollars on a certificate of merit to MPs for doing their job on Canada Day?''
I do not know who the pea-brained idiot was but the minister should have had enough common sense to put a stop to that project before it even started. The fact that she did not shows that she has a flagrant disregard for other people's money. It is certainly easy to spend it, is it not, when they just have to dip into the trough.
As a second example of incremental waste, a travel agent in my riding approached me and showed me the actual computer records of how taxpayers ended up spending much more than was necessary on a fare from Vancouver to Ottawa return.
A conscientious federal employee, knowing that a visit to Ottawa was coming up, approached a travel agent and requested the cheapest fare. The agent showed how a certain combination of fares would result in a total cost of $880. Instead of being pleased, the employee's supervisor instructed the employee to use Rider Travel here in Ottawa which subsequently issued a ticket costing $1,963, almost $1,100 more than that employee would have spent purchasing the ticket in North Vancouver.
Every MP gets letters and calls with examples of that type of waste but absolutely nothing is being done to control it. No wonder the voters have lost respect for the politicians. People see MPs as puffed up porkers slurping at the trough, handing out hard earned taxpayers' dollars to people who will not work, to special interest groups and to businesses that do not need and should not be getting the money.
Meanwhile the Minister of Finance is subjecting Canadians to the torture of a thousand small cuts. That is not the death of a thousand small cuts, but the torture of a thousand small cuts, nothing large enough to get us off the debt and deficit treadmill, but just enough to prevent an immediate fiscal crisis. Irritating little bits of pain for absolutely no gain. It is a course of action that will guarantee years of suffering and no measurable benefits for all of the action taken.
It represents a failure to learn from the experience of countries like New Zealand, provinces like Alberta and states like New Jersey, Massachusetts and Michigan which have shown that the more quickly the budget is balanced the faster the benefits accrue.
The man who was the Prime Minister of New Zealand during the debt crisis, the Hon. David Lange, who is roughly equivalent to an NDP type of prime minister, told me in 1994 that the only regret he had was that he had not moved faster to balance the budget. In hindsight he could see that the benefits would have accrued much more rapidly, shortening the adjustment period and creating jobs more quickly. Today the New Zealand economy is even in better condition that when I spoke about it last year. I used it as an example and I am pleased to update members.
The government sector is about 40 per cent of the size it was in 1984. The abolition of various marketing boards has allowed entrepreneurs to develop new products and markets. Income tax reductions approaching $23 per week for the average worker are being introduced in the next couple of months, and a further tax cut of the same size next year is promised, while the government continues to run large surpluses, paying down its national debt and increasing spending on social programs at the very same time.
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Imagine how stimulative it would have been for the Canadian economy if the Minister of Finance had been running surpluses and yesterday had announced a $46 per week tax cut for Canadian workers. This could easily have been attained if the Minister of Finance had adopted Reform's zero in three program the day he came to office in 1993.
We would not today be talking about how to balance the budget. We would be arguing about how to spend the surpluses. With more money in their pockets Canadians would have spent more, increasing domestic demand which in turn would create jobs and increase government revenues.
In New Zealand and in Alberta revenues increased faster than expected after the budget was balanced, allowing spending on social programs to be increased, for example in New Zealand by almost $1 billion in one year.
It is also important to note that the 12 per cent unemployment rate in New Zealand is now down to 5.6 per cent. When did Canada last have a 5.6 per cent unemployment rate? Canada has proven government deficit spending kills jobs and it will continue to kill jobs as long as it stays on this track.
The failure of the Minister of Finance to decrease taxes in yesterday's budget guarantees that even more jobs will be killed. It also guarantees ongoing deficits and a crippling tax load for our children and our grandchildren.
Mr. Bernie Collins (Souris-Moose Mountain, Lib.): Madam Speaker, I listened intently to what the hon. member from the third party had to say. Let me raise a whole series of items to which he may wish to respond. The only thing about the zero in three is that in three years we would all have zero. We would all be out on the streets looking for a job.
Concerning infrastructure, I do not know where the member travels but as a municipal person who has travelled throughout his riding, I want to assure him that municipal people throughout Saskatchewan were more than proud of the infrastructure program. They supported it wholeheartedly. I do not know where he travels in his riding but he should get out to my riding in Saskatchewan. He would find that people there are responsive. They said that it was a good program. They would like it to go on.
With regard to his evaluation of MPs, I can assure him that as I travel throughout my riding in Saskatchewan and elsewhere in Canada the attitude and level of respect for MPs will come up depending on what he expects it to come up to. If he wants to downgrade MPs and say that all MPs are not doing their jobs, he should just keep on. However, as an MP who feels he has a responsibility to the public, I will continue maintain that we are there, we are honest-
The Speaker: As members know, I like to start a few seconds early. May I ask the hon. member if he would be prepared to answer this question immediately following the question period?
It being 2 p.m. we will now proceed to Statements by Members.
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