(Motion agreed to.)
He said: Madam Speaker, 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 Tax Act and other legislation discriminates against families, particularly those that choose to provide direct parental care to preschool children. One aspect of this has to do with the extension of Canada pension benefits or service credits for those who choose to provide care in the home to their preschool children.
This bill therefore seeks to promote changes which would have the intent of extending Canada pension plan benefits or service credits to those who choose to provide care in the home to their preschool children.
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(Motions deemed adopted, bill read the first time and printed.)
He said: Madam Speaker, I am pleased to rise in the House today to introduce a private member's bill calling for a binding national referendum on reinstatement of capital punishment.
For too long, in fact forever, Canadians have been shut out of the debate process where this issue is concerned. Through the use of a referendum this bill would allow Canadians a say on whether the Criminal Code should be amended to include the death penalty as a sentencing option for persons who are convicted of first degree murder.
Critics will note on reading the bill that it does not ask them to vote for or against reinstatement of capital punishment. Instead it asks simply that MPs allow Canadians to make the final determination in this respect.
I also want to thank my constituents of Nanaimo-Cowichan. It was they who voted overwhelmingly by a margin of 919 to 104 for this initiative to be brought before the House which it is today. I believe this sentiment to be an accurate reflection of the support in rest of Canada for the bill. As such, and in closing, I ask colleagues on both sides of the House to support the bill when it comes before them. More important, I urge members of the subcommittee-
(Motions deemed adopted, bill read the first time and printed.)
He said: Madam Speaker, this private member's bill would provide penalty for those not for profit organizations which fail to disclose the salary and benefits of their executive officers. This includes non-profit organizations as well as charities.
This is the type of accountability that the public is now demanding of those organizations which directly or indirectly receive taxpayers' funds.
This bill is in the same form that Bill C-224 was at the time of prorogation of the first session of the 35th Parliament.
(Motions deemed adopted, bill read the first time and printed.)
The Acting Speaker (Mrs. Ringuette-Maltais): The Chair is satisfied that this bill is in the same form as Bill C-224 was at the time of prorogation of the first session of the 35th Parliament.
Accordingly, pursuant to order made Monday, March 4, 1996, the bill is deemed to have been read the second time and referred to the Standing Committee on Government Operations.
The petitioners 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. They also state that the Income Tax Act discriminates against families who make the choice to provide care in the home for preschool children, the disabled, the chronically ill or the aged. 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 for preschool children, the disabled, the chronically ill or the aged.
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The petitioners bring to the attention of the House that the consumption of alcoholic beverages may cause health problems or impair one's ability and that, specifically, 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 alcoholic beverages.
[Text]
Question No. 11-Mrs. Wayne:
Did the Minister of International Cooperation speak to the employees of the Canadian International Development Agency on January 31, 1996, in the Palais des Congrès in Hull, and if so: (a) what was the total cost to the taxpayer, including: (i) rental of the facility; (ii) translation; (iii) audio visual expenses; and (iv) other costs; (b) where these costs charged to the office budget of the Minister, and if not, to which budget were these costs charged; (c) did a camera crew film the Minister's address, and if so: (i) for what reason was the Minister filmed; (ii) what was the name of the firm contracted to film the Minister's address; (iii) how many copies of the tape were made, and to whom were they given; and (iv) what was the total cost to the taxpayer, including production, editing and distribution?Hon. Pierre Pettigrew (Minister for International Cooperation and Minister responsible for Francophonie, Lib.): In so far as the Canadian International Development Agency is concerned, on January 31, 1996 an agency forum was convened by the president of CIDA with CIDA headquarters staff to introduce the Minister for International Cooperation with responsibility for CIDA, the Honourable Pierre S. Pettigrew. As is the common practice when a new minister is appointed to any federal public service department, staff members were given the opportunity to hear the minister's views on pertinent issues and to meet with him afterwards.
The cost of this agency forum was $1,670, broken down as follows: room rental, $750; coffee, tea, juice and muffins, $920. There was no translation provided, as these staff meetings are conducted in both official languages.
The costs were charged to CIDA's communications branch, as the event supported internal communications.
The agency forum was videotaped so that CIDA staff members posted to Canadian missions overseas could view the forum on videotape. This is the usual practice for departments with employees posted abroad. The taping was carried out by Productions André R. Lavoie Inc., and 60 copies were made for CIDA staff abroad. All work was done in-house, with the exception of the taping which cost $400. Tape stock was purchased for $410.73 and the ADCOM Presentation Group provided technical equipment for $56.71. The total videotape cost was $867.44.
[English]
Mr. Zed: I ask, Mr. Speaker, that the remaining questions be allowed to stand.
The Acting Speaker (Mrs. Ringuette-Maltais): Is that agreed?
Some hon. members: Agreed.
Ms. Marlene Catterall (Ottawa West, Lib.): Madam Speaker, I am pleased to have the opportunity to address the 1996-97 budget.
Since the beginning of our mandate in 1993 the government has been faced with many significant challenges. These challenges have been met directly, openly and honestly with the people of Canada.
[Translation]
We all know that too many Canadians are unemployed, that Canadian businesses are still having a hard time, that we must get down to work right away to maintain social programs that are the envy of the world. We all know this, and our government intends to deal with these issues that concern all Canadians.
[English]
Much progress has been made to date in achieving the goals of job creation and economic growth, and the sustainability of social programs. The unemployment rate has declined two full percentage points since the Liberals formed the government. Over 600,000 jobs have been created and inflation is at its lowest level in 30 years. Interest rates have remained low largely because of the successful action on deficit reduction. Interest rates are critical to the maintenance of job creation and economic progress.
We have also tackled the maintenance of the health care system and social programs through progressive reviews in consultation with Canadians.
The 1996 budget accomplishes much to complement the work that has been done to date. To progress with the job creation and economic growth agenda, the government has in the budget focused on three priorities: youth, trade and technology.
Despite reduced spending in virtually every area of government activity, spending on youth has been substantially increased. This budget will provide an extra $315 million over the next three years toward creation of jobs for young Canadians. An additional $165 million is being provided for students. The federal government will work closely with provinces and businesses to help young Canadians find that crucial first job.
[Translation]
Since we came to office, Canada's exports have soared. This increase in trade has been the driving force behind job creation and economic growth. Team Canada's trade missions have been highly successful, generating $20 billion in sales for Canadian businesses.
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[English]
The 1996 budget will further aid the development of exports by giving the Export Development Corporation $50 million in new equity capital for export financing and the Small Business Development Bank $50 million to assist small and medium sized businesses, in particular, to participate in international trade.
I said the third priority was science and technology. Leadership in the knowledge industries means more jobs, lasting jobs and better jobs for Canadians. High knowledge industries have contributed more to recent job growth than all other industries combined.
Over the long term, businesses using new technology will create new jobs faster than old jobs disappear. This is why technology is a key element of the job strategy.
Through the 1996 budget special support is being provided to key sectors such as aeronautics, biotechnology, environmental technology and the development of the information highway. Just one example is the student connection program which will hire 2,000 students to show 50,000 small companies how to use the Internet to help their businesses.
This is an area of investment of scarce dollars that is particularly important for my community and for the national capital region. The region has been significantly affected economically by downsizing in the public service which will amount to a total of 15,000 jobs disappearing over three years starting with the last budget. As we seek to diversify the local economy, local governments, the business community and the federal government working in co-operation, the importance of high technology development to our region is absolutely crucial.
At the same time the government is making efforts to improve the situation of the public service. The wage freeze legislation will expire this year. It will not be renewed. It will not be extended. Beginning in June annual increments to public service employees will again be the order of the day. A return to collective bargaining as the wage freeze legislation expires is something to which we all look forward.
I want to speak very briefly about a couple of things that are of particular concern to my constituents because deficit reduction without tax increases does not come easily and does not come without pain, nor does ensuring the sustainability of social programs like our pension system.
The government is acting to ensure that the public pension system, which has done so much to alleviate the poverty of seniors, continues. It will be done by increasing benefits to the lowest income seniors and by ensuring that those now receiving benefits or within five years of receiving old age security or other retirement benefits will continue to have the right to those benefits.
As the minister looks toward the development of this legislation I want to raise with him some concerns that have come to my attention. First is the very short time frame for implementing the rollover of RRSPs into RRIFs or retirement income. This is causing great concern to people who have made investment plans under the rules that existed. They are saying we need a better phase-in period.
I also want to draw to the minister's attention my concern that the legislation implementing the changes to pensions as well as to RRSPs should pay attention to the need to improve the economic status of retired women. Ninety per cent of the poorest elderly in this country are women. I do not think any of us need an
explanation as to why that happens; work history and a variety of other situations.
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We have an opportunity as we implement changes to the pension plan to also equalize the retirement income of women. I urge the minister to do that. I would be happy to share with him some ideas on how that might be done.
In conclusion, this has not been an easy budget. It has involved some difficult choices as has every one of our budgets since 1993. It is a reasonable balance between the kind of compassionate, caring society we want and the fiscal restraint that currently is necessary to get us to a much better future for the entire country. I am pleased to speak today in support of it.
Mr. Leon E. Benoit (Vegreville, Ref.): Madam Speaker, the member indicated that her government is concerned about maintaining social programs into the future. She is concerned particularly about maintaining pensions.
If that is the case, why does her government continue to increase the amount of money spent on interest payments on the debt from $38 billion to about $50 billion since it has come into power? Why did her government leave in place a pension plan that is totally out of line with what is acceptable to Canadians? If the government was serious about maintaining social programs and pensions, it would not have left in place the pension plan that it has.
How can Canadians believe that her government is really, truly concerned about the future of social programs when its actions say otherwise?
Ms. Catterall: Madam Speaker, I think it behoves the hon. member for Vegreville to acknowledge those areas in which the government has made substantial progress.
Specifically the member talked about the debt and the deficit. I sat in this Chamber through five budgets of the previous government and saw threats, promises, cutbacks and sacrifices so that we could get the deficit under control. The deficit just kept going up.
Our government in just two budgets has been able to substantially reduce the amount of the deficit. The hon. member knows very well that in the next two budgets we will have dropped not from 6 per cent of GDP in deficit to 3 per cent as we committed at the last election, but to 2 per cent, in other words not by 50 per cent but in fact by 66 per cent. That will bring the deficit from over $45 billion when we took office to $17 billion by the time our term is over.
Regarding pensions, this is the first government since the MPs pension plan was introduced in the 1950s that has actually reduced it to the tune of $3.3 million worth of savings to Canadians. It has reduced the benefits by over 20 per cent. We have met every single one of our commitments on that matter and have gone beyond them.
Yes, it is still a very generous pension plan. It is one for which, as the member knows, MPs pay very generously as well, far more than most other pension plans. It needs further reform but one cannot disrupt the lives of people who have served in this House for decades by suddenly saying they do not have the pension plan they thought they had.
In terms of the sustainability of pensions generally, 75 per cent of seniors in this country live on incomes of under $26,000. Ninety per cent of the poorest seniors are women who are either single, widowed, divorced or separated.
I regret as much as anybody in this House an end of a universal pension plan which is an entitlement of citizenship. I also realize the necessity of looking after those lowest income seniors when resources are limited. I am pleased that we are going to be increasing benefits to those lowest income Canadians in retirement.
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Mr. Benoit: Madam Speaker, in the last election campaign when Reform proposed targeting old age security to those most in need, the Liberals promised that they would never end universality of old age security. Now the finance minister has done that.
We could not believe them on the GST. We cannot trust them on old age security. The numbers the hon. member used in terms of deficit reduction are yet to happen sometime in the future.
The Liberal government has made a little progress on the deficit. Canada's debt is the second highest in the industrialized world and it is still being added to every year.
It is so difficult to understand how members of that party can say with a straight face that they are doing what has to be done to assure that the money will be there for social programs into the future because they have not.
Ms. Catterall: Madam Speaker, as I encouraged the member to do on his first question and comment, I suggest that he might want to accurately reflect what our government has done. He knows perfectly well that deficit reduction is not something for the future. He knows very well this is the first government in over a decade that has successfully reduced the deficit from $45 billion to $30 billion. That is a one-third reduction in only two budgets and that is a substantial reduction.
On pensions, let me just say we are not like the Reform Party. It wants everybody to have to rely on themselves for their pensions.
Mrs. Dianne Brushett (Cumberland-Colchester, Lib.): Madam Speaker, it is a pleasure for me to rise in the House today to address the 1996-97 budget as presented by the Minister of Finance on March 6.
When our government was elected in October 1993, Canadians from coast to coast to coast told us that reducing the deficit and the debt must be our number one priority. This budget along with our two previous budgets showed Canadians that we have been and continue to be listening.
When this government was elected the annual deficit was more than $42 billion. By the end of the 1995-96 fiscal year we reached the deficit reduction target of approximately $32 billion. We are on target to reach our original goal set for the 1996-97 fiscal year of a deficit of 3 per cent of GDP which will be approximately $24 billion.
The Minister of Finance has already set two rolling targets to take us into the second half of our mandate. These targets will reduce the deficit to 2 per cent of GDP by fiscal year 1997-98. By the turn of the century, by the year 2000, I personally hope to see that the deficit is realized to zero and the introduction of a balanced budget to this House.
The 1996 budget continues on the track of reinventing government. Last year through a major program review we managed to protect vital programs while reducing spending to its lowest level of GDP in almost 50 years. This year we have further reduced program spending in order to move closer to a balanced budget. Federal program spending this year will represent 12 per cent of GDP, its lowest level since 1949 and down from 20 per cent only a decade ago.
Liberal governments over the years have played a leading role in building Canada's social programs. Today faced with dramatic changes to our society and our economy, the Liberal government must ensure that these programs remain effective and financially sustainable.
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One way the government is doing this is through the new Canada health and social transfer which consolidates transfers for health care, post-secondary education and social services. The transfer is a block fund which offers more flexibility to the provinces. This flexibility will allow for the development of innovative programs for Canadians receiving social assistance. Greater flexibility will also reduce administrative costs and will allow provinces to adjust to the new funding levels while still protecting programs that Canadians desire.
This budget introduces a five year funding arrangement for the CHST for the years 1998-99 through to 2002-03. The CHST will be stabilized at the 1998-99 levels for another two years and then will begin to grow. There will not be any cuts to the CHST beyond those announced in last year's budget. When the CHST begins to grow beyond the year 2000, federal transfers will increase for the first time since the mid-1980s.
The CHST will allow provinces to plan programs to meet their needs with clearly set levels of federal funding. By providing predictable funding, the government is demonstrating its commitment to safeguarding health care and other social programs that are valued by all Canadians.
As we all know, part of the CHST is made up of a cash transfer which was scheduled to gradually decline. However, in response to concerns about diminishing cash transfers, this government has announced that the cash component will be kept above a floor of $11 billion per year for the five years between 1998 and 2003.
While the CHST will give more power to the provinces, the cash transfer will guarantee a strong federal presence for programs of national priority such as post-secondary education and social assistance.
In addition, the government will continue to vigorously defend the five principles of the Canadian health care system: comprehensiveness, universality, accessibility, portability, and public administration. The federal government will also work with the provinces to develop other shared principles and objectives for this new transfer.
This budget is good for Canadians. For the third year in a row there will be no increase in personal income tax rates nor will there be any increase in excise taxes.
Additionally, the budget marks a significant turning point. In our first two budgets we were forced to make a lot of tough but necessary decisions in order to clean up the economic mess left by the previous government. Unlike those budgets, this budget has a more direct focus on the future, a more sustainable plan, a long term plan for Canadians. This focus is reflected in our attention to our youth, our attention to working families and in particular to seniors.
February's throne speech put the problems facing Canadian youth into the spotlight. Youth unemployment and underemployment are a serious concern in my riding of Cumberland-Colchester. Young people throughout the area feel that they have to leave home, in fact many of them must leave the country to find employment.
This budget announces concrete measures which demonstrate that the Liberal government is serious about improving opportunities for young Canadians. To make education more affordable, tax credits for university and college students and their parents will increase. This budget will also stabilize the funding that we transfer to the provinces for post-secondary education. In addition, it lays out a plan to increase that funding over time.
This budget will double federal funding for summer jobs. In 1996-97 we doubled the number. There are 200 more jobs in my riding. The deadline was April 12 and we encouraged employers in all sectors of our society to get out there and employ our youth this summer allowing an extra 30,000 young Canadians to gain vital experience and help finance their education. It also challenges the
private sector and other levels of government to do their share to create opportunities and to assist our youth in finding their first job.
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My riding of Cumberland-Colchester consists of hard working families who work long hours with fewer benefits to try and stretch that paycheque as far as they can. These families will benefit from this year's budget.
Parents who wish to return to school in order to find better jobs will now be able to make full use of the child tax credit. This includes parents who show the courage to return to high school. We are raising the age limit for the child care deduction from 14 to 16 years so that more parents who work nights can claim it. As well, we are doubling the working income supplement of the child tax benefit. This will mean an extra $500 a year for low income working parents.
This budget is also committed to security for the elderly through the availability of old age security and the guaranteed income supplement. The budget includes a new seniors benefit to be implemented in the year 2001. This tax free benefit will replace the existing OAS and GIS programs. More than 70 per cent of our seniors will actually receive higher benefits under this new system, many of whom are single women.
Pensions for today's seniors, near seniors and their spouses will be protected. Seniors will be guaranteed to receive an amount that is no less than the current pension plan. The new system will better respond to the needs of low income seniors and will ensure a responsive, affordable system for our children and grandchildren. Let there be no doubt that we will look after our elderly and that this budget is the first step in doing so.
There are a record number of single parent households in this country. When a marriage breaks down, the children are always the first to suffer. I have received many letters from men and women alike who are concerned about the current child support system. This budget speaks to those concerns and introduces measures to improve the system, measures that include a revised tax treatment of child support payments.
Currently child support payments are taxable for the recipient and tax deductible for the parent paying support. This is wrong. Payments are supposed to provide support for children. They are not income for parents. The budget proposes that all child support awards agreed to on or before May 1, 1997 will not be included as income of the custodial parent for tax purposes, nor will they be tax deductible for the parent paying the support. The government will also introduce new guidelines and enhance enforcement for the collection of child support payments.
The Acting Speaker (Mrs. Ringuette-Maltais): I regret but the member's time has expired. Questions or comments. Resuming debate.
Mrs. Daphne Jennings (Mission-Coquitlam, Ref.): Madam Speaker, this is the third federal budget I have spoken on since I came to Ottawa. In each budget I have expressed major disappointment: in the first, because it did not deal with the fiscal realities that faced Canada in 1994, the deficit and the debt; in the 1995 budget, because it missed a tremendous opportunity to put Canada on a positive fiscal course which would see the deficit eliminated and the debt paid down within the next five years.
Like Liberals of old, the Liberals who started deficit financing rather than making tough decisions, these present day Liberals again put off tough decisions. This refusal to come to grips with Canada's debt problem plus interest on the deficit means that the debt has continued to soar. By the end of March it was over $578 billion. The Liberals by failing to address this issue have added over $200 billion to the national debt.
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As the debt grows, so does the interest that must be paid. The government now pays $47 billion in interest on the debt. This is more than it pays on elderly benefits, unemployment insurance, payments to aboriginal peoples, foreign aid, the CBC, and science and technology combined.
Let us face it. This is not just a waste of the taxpayers' money. It affects how business and industry reacts to our country. This kind of mismanagement of the country's economy does not create a climate for investment, it does not create confidence.
If the government had proceeded immediately in the 1994 budget to address Canada's problems with the economy, the confidence for investment and job creation would now be with us. The job creation proposals in the budget which we all know will not create a single long term job would not have been necessary and would not be with us now eating up taxpayers' dollars.
If the right economic road had been followed in the beginning by these Liberals, they would now be in a position to reduce taxes. A reduction in income taxes, a reduction in payroll taxes, unemployment insurance premiums and the elimination of the heavy regulatory burden which follows Canadian companies would go a long way to stimulate investment in Canada. These are the measures that should have been announced in this budget.
A failure to deal with the deficit and Canada's accumulated debt is not the only shortcoming of this budget. This budget also has severe human consequences. The finance minister and the Minister of Justice through their combined wisdom have seen fit to get involved through the budget in the payments made by the non-custodial parent to the custodial parent after divorce. Starting in May 1997 these payments will no longer be tax deductible by the
paying ex-spouse and will not have to be included in the income of the receiving spouse.
Why the government will not leave the issue of taxation of child support payments to be dealt with by the parties themselves with the help of a mediator is beyond me. However what worries me even more is the fact that this new rule can be made retroactive. It can be made to apply to payments that are now being made. This means that thousands of Canadians, who prior to budget day thought the matter of child support was well settled, are now reviewing their child support agreements to see how this budget will affect them.
Now that the paying ex-spouse may no longer claim a tax deduction for the support payments, he or she will have less money to look after their new family as well as to help the ex-spouse and the children of the first marriage. Who is going to benefit from this massive tax grab? Not the parents involved in the divorce, not the custodial or the non-custodial parent and certainly not the children.
Who will benefit? The government. No new taxes in this budget. That is a very dishonest statement. The government already knows it will make over $250 million on this new program in a major tax grab.
What if some of these ex-spouses are already having a difficult time making support payments and keeping up with the demands of a new family? Without the help of a tax deduction might they be less inclined to make full support payments? Is the government building a new monster, another social problem on the backs of divorced parents?
As well, thousands of family law lawyers across the country are down on their knees thanking the justice minister for increasing their billable income for at least the coming two years. This piece of legislation has opened the floodgates to more litigation. How dare the Minister of Justice and indeed the Liberal members of the House of Commons justice committee decide to vote down my private members' bill on grandparents rights because it might increase litigation and then support this budget measure which virtually by definition will increase litigation. Perhaps my bill in reality did not increase litigation enough for them to support it.
What about seniors issues? Seniors issues are put off to be dealt with in the next century. If the old age security and the guaranteed income supplement need to be changed or need to be replaced, why put it off for four years? Again, if a tough decision which might affect the government's popularity could be made, the Liberal solution is to put it off at least until after the next election.
More than that, I believe the Liberals in this budget have broken faith with our seniors. During the Quebec referendum period and in the run-up to the budget, the Prime Minister repeatedly assured Canadian seniors their retirement incomes were safe. In a supplementary document entitled: ``The Seniors Benefit: Securing the Future'' the government stated: ``Current seniors have the right to continue in their retirement secure the change will not affect them. That is guaranteed''. This is what the government said but this is not what it has done.
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Let us look carefully at the actions of this government. The government reduced the mandatory withdrawal age for RRSP contributors from 71 to 69. Seniors will pay more in taxes over their retirement. Because of this budget, seniors will have to remove their retirement savings from the their RRSP accounts attracting tax a full two years earlier than would otherwise be the case.
Could it be that when reality hits our seniors and they realize they will not be better off, that in fact they will be forced to roll over their RRSPs at 69 years of age instead of 71, they will realize that this Liberal government has increased their tax burden and taken away direct savings from their many long years of hard work as dependable Canadian taxpayers?
Is it that by placing the proposed new seniors benefit to come into force in the year 2001 the government hopes to coast in on the next election and by the time that our seniors realize they have been hit with a new and higher tax on their retirement income it will be too late?
This government seems to be maintaining its do nothing attitude and closing its eyes to an increasing debt of close to $600 billion. No change that negatively affects seniors, I do not think so.
What else did this budget do? The government froze the RRSP contribution limit at $13,500 until 2003, lifting it marginally thereafter. Again this affects the ability of Canadians to provide for their own retirement. Again the government's promise to seniors has been broken.
As I said earlier, seniors are living longer healthier lives, retiring later by some. They want the right to service their own retirement. They want the government to live up to its promises.
Then there are the Liberal make work programs. The Liberals will spend over $65 million in the next five years to establish a commission to study health care needs. Canada's health care needs no more studies. This is simply a way to put Liberal friends on the commission. Then there are the other make work projects for youth. None of them create meaningful long term jobs. I know it, my party knows it and worst of all, the Liberals know it but again, it looks good and it sounds good to the electorate.
The only long term permanent jobs are created by industry in a healthy marketplace. Industry will only create these jobs when it is
confident the government is moving in the right direction. Tax relief might have been a good answer in part of this budget.
With this budget the Liberal government has missed a great opportunity to do something for the future of Canada. It did not. Perhaps it is time it stepped aside and let the people of Canada decide on the future of this country.
Mr. John Williams (St. Albert, Ref.): Madam Speaker, it is as clear today as it ever has been that Canadians do not want rhetoric from their government. What they want is action. What they seek is real progress.
These are the standards that Canadians have set. These are the standards by which this government wants to be judged. Seldom in our history have so many experienced such anxiety. Canadians feel our very way of life is at risk. They look at medicare and feel it is threatened. They look at the pension system and wonder if it will be there in the years to come. They consider the economy and worry that the gale force winds of competition and change will carry away their jobs. And Canadians think about their children, our youth, and ask what kind of opportunities will be left for them.
These are damning statements from a member of the opposition but that is a direct quote, the opening paragraphs of the speech by the Minister of Finance to this House, the budget speech on March 6, 1996. That is the admission of the Minister of Finance to the House and the country: the government does not have the answers that are required, does not have a plan and, halfway through its mandate, has done virtually nothing to address the major concerns of Canadians.
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Let us look at these questions. Canadians feel their very way of life is at risk. That is a statement by the Minister of Finance. Of course it is at risk. Why? Taxation is going up and up, contrary to what the Minister of Finance says. While he says that he has not raised taxes, everyone knows that he has raised taxation revenue from Canadians by taking a dollar from the seniors, by reducing the amount that they can put into RRSPs. They are going to be cut off at age 69 instead of age 71.
The minister knows full well that the basic exemptions for income tax are not indexed for inflation at all as long as inflation is under 3 per cent. He has taken unemployment insurance premiums out of Canadian taxpayers faster than would otherwise would be required.
What a litany of exercises by the Minister of Finance. By squeezing more dollars out of this program and collecting a little more from that program, ensuring that Canadians have to pay more somewhere else, all the while he is claiming that he has not raised taxes. I will give him his due. While he has not raised the general rate of taxation, he has done everything in his power to raise taxes by every other means at his disposal.
That is why Canadians feel that their very way of life is at risk. The Minister of Finance says that Canadians look at medicare and feel it is threatened. They have every right to feel it is threatened. The government remains absolutely committed to keeping its head in the sand. It stands by its five principles that unfortunately are outdated.
Medicare has stood us well until now, but unfortunately we have a plan that we can no longer afford. Changes are required. What does the government do? It does absolutely nothing. It has not changed one thing, other than transfer less money to the provinces. It is allowing them to figure out how to deliver health care within a framework that was devised 30 years ago. Unfortunately the provinces are finding that they cannot live within the new restrictions. That is why medicare is threatened.
It is up to the government to do something to demonstrate leadership. If I recall, the Prime Minister campaigned in the last election that he would convene a conference of the health ministers to resolve the crisis in health care. That was going to take place by June 1994. It will soon be June 1996 and we are still waiting for that to happen. That is why health care is threatened.
Seniors look at the pension system and wonder if it will be there in the years to come. The actuaries have said that there is a $600 billion shortfall in the Canada pension plan.
Today the government has started a travelling road show to ask Canadians what they want. Where is the leadership from this government? Where is the commitment by the government to the seniors who have worked hard all their lives? Now that they are retired and dependant on their savings and the money that they paid to the Canada pension plan in the belief that old age security was going to be there for them, these are the things that are threatened.
Seniors are concerned. They are asking if the pension system will be there for years to come. We have said and seniors are saying it more and more that it is not going to be there. The newspapers today are suggesting that the premiums are going to double in order to maintain the program that is currently available.
I am not sure the Canadian economy can afford a doubling of premiums. That is why Canadians are concerned. Is the Canada pension plan going to be there for the seniors of today, far less the seniors of tomorrow? It is an answer to that question which we want from the government.
In the budget speech the minister said that old age security and the guaranteed income supplement are going, that they will be finished in the year 2001. No more old age security. No more
guaranteed income supplement. The programs that seniors have depended on for the last generation or more are going to be wiped away.
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Where does that leave them? We know the minister is going to introduce something called a tax free benefit to seniors. However, is that going to be better or worse for seniors? They do not know, which is why they have every right to be concerned.
Not only is the government saying it has a serious problem with the Canada pension plan but it does not know how to fix it. In the same speech the Minister of Finance states he is taking away the old age security and the guaranteed income supplement and is replacing it with something called a tax free seniors benefit which, as far as we can tell, could in many cases pay seniors less than what they are receiving today.
Do seniors not have the right to be concerned? I think they have a right to be concerned. I would think the government would say that they have a right to be concerned. Yet halfway through its mandate, the Minister of Finance is making statements at the beginning of his speech which are almost an admission of failure to manage the programs that it was elected to manage.
The government considers the economy and worries that the gale force winds of competition and change will carry away the jobs. Does anyone remember what was the promise of the election campaign of this government? It was jobs, jobs, jobs. Now it is saying that people are concerned that the changes in the competition will carry away their jobs. What is the government doing about it? Not very much. Nothing at all.
The government spent $6 billion on an infrastructure program and the President of the Treasury Board said it created 8,000 permanent jobs. This is 8,000 jobs for a $6 billion investment. Was that value for money? I do not think it was. As I have said many times, the government would have been better to have put the money in the bank and given the people the interest.
There are many more things I would like to speak about, such as the privatization of NavCan and CN Rail. We are now hearing that the food inspection branch is going to be set up in some kind of unaccountable, removed from government, removed from criticism by the members of Parliament. We hope it is going to do a good job.
The government says it is committed to cutting down on waste. There are many issues that I would love to talk about and continue on. I have only got to the first half of the first page of the minister's speech. I could go for days. Unfortunately I cannot.
Ms. Marlene Catterall (Ottawa West, Lib.): Madam Speaker, I have to make the same comment I made to the person questioning me after speaking on the budget. I think one of the best things we can all do as parliamentarians for our constituents and for Canadians generally is to give them the facts.
Therefore, when the member who has just spoken talks about taking away the old age security and the GST and talks about those programs as being gone, finished, wiped away, he knows that is not the truth. He knows perfectly well that any senior now receiving a benefit will continue to receive exactly that benefit. He knows that any person within five years of being entitled to those benefits will be entitled to continue receiving them for the entire period of their retirement. He knows that is a commitment of the government and of the Prime Minister personally. It is precisely what is laid out in the budget, unless those seniors now aged 60 and looking forward to retirement at 65 determine that the new combined benefit is in fact to their advantage.
The member also knows that combining those benefits and directing them is going to make sure that 90 per cent of the elderly poor who are at the lowest level of income, 90 per cent being sole support women, will in fact get more not less. He knows that the benefits for today's seniors are not in danger.
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That is quite a bit different from the Reform Party plan which requires everybody to put something aside for their own retirement under some kind of private RRSP system.
I remember the days when my father made $90 a month. This plan would require many families to choose between putting food on the table for their children or providing for their retirement 40 years hence. As a mother, frankly I know what choice I would make. That is not security in retirement.
As well, he knows that the Prime Minister has kept his promise concerning health care by establishing the national health forum which the Prime Minister personally chairs. Perhaps the hon. member would consider doing what I and many Liberal members have done in our ridings and hold a forum in which his constituents can give him their views, as mine have done, on what their priorities are for a sustainable health care system for the future.
The member asked about the infrastructure program. Was that value for money? Ask the 100,000 plus people who had a job for that time if they thought it was value for money.
Mr. Williams: Madam Speaker, the member asked for the facts. Let me give the facts.
``There is widespread anxiety, particularly among the young, that the public pension system will not be there for them when they retire''. That is a direct quote from the Minister of Finance. ``First
the CPP must be put on a sound financial footing and done so in a way that is sustainable, affordable and fair''. Another direct quote from the Minister of Finance.
Carrying on: ``Clearly, the government should have acted some time ago to address this problem''. A direct quote from the Minister of Finance. I can go on and on.
The point I am trying to make is that seniors and everybody else listened to the Liberals when they said jobs, jobs, jobs, when they said that is going to be there for them. The Liberals told Canadians not to worry about their pensions because they would make sure they will be there. What did we find out? There were no answers coming from the government. The facts speak for themselves. These were direct quotes from the budget speech by the Minister of Finance to this House on March 6, 1996.
Hon. Charles Caccia (Davenport, Lib.): Madam Speaker, in the few minutes available I would like to put forward some thoughts on future budgets.
First, let me congratulate the minister on his announcement on March 6 of the change to the Income Tax Act regarding investments in energy efficiency and renewable energy sources. This is an initial step in the right direction which will help in keeping our red book promise to reduce carbon dioxide emissions.
The main point I would like to make today is to express the hope that sooner or later, but preferably sooner, the government will find it possible to conclude the policy of deficit reduction and review and expand public sector expenditures in an effort to improve the social and economic conditions of most Canadians, particularly low and middle income earners.
We have witnessed with apprehension the phenomenon of certain large corporations, banks and other financial institutions making record profits by continuing to ``downsize'' their workforce. The time has come, as one observer recently put it, to downsize downsizing for the sake of social peace and stability.
The Easter recess has allowed me time to note the profound malaise caused by unemployment and poverty and to bring back to Ottawa from Toronto and Montreal recent images and impressions of the hardships Canadians are presently enduring.
In increasing numbers people are sleeping on sidewalks and in telephone booths and are reduced to begging for change in our downtown urban areas. Families are struggling to make ends meet. There are even reports that the financial hardship resulting from cuts to welfare payments in Ontario has become a factor in parents offering their children for adoption. Cash strapped municipalities are finding it almost impossible to provide basic services, from road maintenance to public libraries to providing an adequate number of teachers, to mention a few.
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Social housing applicants are waiting longer and longer, in some cases several years, before their turn comes.
High youth unemployment set at 15.3 per cent in March has eroded the confidence and hope of our young people to find meaningful work commensurate with their training and career plans. It is no wonder that youth are without jobs when thousands of people have been and continue to be thrown out of work as a result of corporate and government layoffs, including the 10,500 provincial civil servants recently cut by the Harris government in Ontario.
Consumers are hesitant to buy even small appliances because of the uncertainty posed by potential job loss. Companies such as General Motors are closing down auto parts plants in Oshawa and Windsor because of low cost competition in the U.S., all in an effort to please the insatiable corporate appetite for larger and larger profits. Also, Kenworth Trucks in St. Therese, Quebec is giving notice that it intends to shift and enlarge truck production to its plant in Mexico.
New housing starts remain at a record low while the savings rates of Canadians stay at record low levels and the percentage of after tax personal income going toward servicing their debt is at a record high.
The poverty gap, that is the amount of additional income that would be required to bring all Canadians above the poverty line, amounts to a staggering $15.2 billion with single parent mothers representing one of the largest groups living in poverty.
It seems to me that these points call for a number of measures, the most pressing being the urgent necessity of redistributing incomes. Personal and corporate tax expenditures alone still cost the federal government billions of dollars in lost revenue. Some of these expenditures are necessary and warranted but others such as the non-taxation of gambling and lottery winnings, alone amounting to some $900 million in lost revenue in one year are not.
To give another example, the tax concessions in the resource sector such as the Canadian exploration expense and the Canadian development expense are conservatively estimated at $150 million a year. These expenditures are no longer justifiable if development is to become sustainable.
Over the past 30 years corporate taxes as a percentage of federal government revenue and as a percentage of GDP have declined. There was a corporate tax rate reduction from 46 per cent to 38 per cent under the Mulroney regime, thus reducing the corporate fiscal burden in Canada to one of the lowest among OECD countries.
While the social safety net has undergone intense scrutiny and reductions, for example unemployment insurance and the Canada assistance plan, outside of small increases in the large corporation tax and corporate surtax in 1995-96, increases in corporate taxation remain untouched in this budget. This policy has produced a serious imbalance between the treatment of social and economic policies.
For these reasons, sooner rather than later the Minister of Finance needs to shift his focus of attention from deficit reduction toward a policy which will: one, restore fairness and progressiveness in the tax system so as to bring back the confidence of Canadians in their government's sense of social justice and equity; two, give poverty issues the attention they so urgently require; three, provide low income Canadians with adequate social measures to ensure they can live in dignity; and four, translate the government's commitment to sustainable development into coherent policies that will ensure future growth while taking into account the need to protect our freshwater resources, the necessity of clean air to breathe, the fragility of many ecosystems, the need to adequately conserve our agricultural soil and the need for sustainable fisheries and forests, to name a few.
In addition, our sustainable development policies must respect our international commitments from the management of toxic waste to the ratification of the law of the sea, from the biodiversity convention to our commitments to lower carbon dioxide reductions under the climate change convention. All of these are important Liberal commitments we must work to realize.
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In conclusion, I have a few words on the phasing out of the old age security pension over the next five years and the Canada pension plan. The replacement of the old age security pension with the proposals for new seniors benefits involves basing benefits on household income instead of on individual income as is the present case. Unfortunately the losers in the scenario are married women who have no income of their own who at the same time have no legal entitlement to the income of their spouse. I urge the government to redress this inequity over the next five years to ensure that married women retain the same degree of financial independence they have presently under the old age security pension.
On the Canada pension plan, I congratulate the government for launching today public hearings in Toronto which will help decide on the future of the CPP. Our increasing senior population makes it necessary to do in Canada what has already been done in other OECD countries namely, to increase contribution rates so as to retain both the present retirement age and level of benefits. This is a small price to pay for a retirement plan which benefits most Canadians who cannot afford a private retirement plan and which permits mobility from province to province and from job to job.
The Canada pension plan is one of the best plans of its kind in the world. It is funded entirely by contributions from employers and employees without a penny coming from taxes. It serves Canadians well and has done so for some 30 years. It ought to remain as a public fund owned and operated by the public sector for the benefit of many generations of Canadians to come.
Mr. Jack Ramsay (Crowfoot, Ref.): Madam Speaker, we have seen governments over the years bring forward budgets that have expressed their concern about overspending and deficit spending, yet each year the debt has grown and grown and grown. Since 1993 we have heard exactly the same kind of rhetoric, that everything is fine, we are on track, be happy and do not worry. Yet the debt has continued to grow year after year after year. The finance minister will not tell us when he believes we will stop sliding into debt. In other words, he has not set a date like many of the provinces have for a balanced budget.
Seeing as how the interest payment on our debt is the greatest threat toward our social programs, including our senior citizens programs, that enormous amount of money we have to pay on an ever rising debt which is going to amount to approximately $50 billion by 1997, which is just next year, is the government prepared to tell Canadians when it expects to balance the debt? Would the member be prepared to offer an estimation of what the debt will be when the government finally reaches a point when it is no longer overspending and borrowing, but instead living within its means? What does the hon. member think that debt and the associated financial interest payments will be?
Mr. Caccia: Madam Speaker, the hon. member is engaging in a typical Reform misconceptual game of linking debt with social security payments and I think he is wrong. He is completely wrong because the social security system cannot be seen in isolation as a factor that runs counter to economic interest.
Whatever penny or dollar is spent in terms of pensions is returned to the economy very quickly through expenditures by seniors who certainly know how to use their revenue. Usually that revenue goes to the cornerstore, to the supermarket, to transport and other commodities.
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Therefore there is no conflict between the well-being of the economy and the well-being of social security. On the contrary, by ensuring that our seniors receive an adequate pension payment, adequate security and the ability to live in dignity as they do now, we also pump the money back into the economy and everybody benefits from it.
I noticed on the part of the hon. member the same tendency as that of the hon. member for Prince Albert, a desire to spread some fear among Canadians about the future of their Canada pension plan. The Canada pension plan as it stands today is not in any
danger at all. It is a pay as you go scheme. It is a scheme that takes care of the immediate present and will be put in a condition to take care of future generations as the number of seniors increase by adequate adjustment in the contributory benefits.
In doing so we can look forward not just to a few years but decades and decades of Canadians having a pension plan that will at least meet the basic requirements of an individual. It is a system and a scheme that for the last 30 years, as a result of a fine Liberal measure, has served us well. I must make sure the hon. members of the Reform Party understand that the Canada pension plan does not receive one penny from the taxpayers. It is a self-sustaining plan.
Mrs. Sue Barnes (Parliamentary Secretary to Minister of National Revenue, Lib.): Madam Speaker, I am pleased today to rise to discuss the Minister of Finance's March 6 budget.
This budget proves that the government is keeping its promise to put Canada's fiscal house in order. The 1996 budget consolidates and extends the actions taken in the 1994 and 1995 budgets. It continues our work to create the proper climate for economic growth and job development. It meets and even betters our fiscal targets.
It ensures the sustainability of Canadian social programs so that those who need assistance receive assistance. The budget relies on government expenditure cuts to meet our goals. There are $1.9 billion in cuts in 1998-99.
Program spending stood at 16.8 per cent of GDP when this government took office in 1993. It will be reduced to 12 per cent in 1998, the lowest level since 1950. Taken together this government's first three budgets have introduced seven dollars in cuts for every dollar of tax increases. Our borrowing requirements will drop from $30 billion in 1993-94 to $6 billion in 1997-98. As well the ratio of debt to GDP will drop by more than one percentage point in 1997-98. In other words, the economy will finally be growing faster than the debt in 1997-98. The hon. member asked that question just moments ago and I have just provided the answer.
The cuts we have made are strategic. We are remaking government to meet the needs of Canadians in a globalized high tech world. Government may be smaller but it is more efficient. Services are provided more quickly where and when Canadians need them.
I would like to review the budget measures relating to Revenue Canada. We are strengthening our ability to combat the underground economy. The underground economy is not a victimless crime. It hurts honest taxpayers who are forced to pay more than their fair share of taxes. It places honest businesses at a competitive disadvantage. Revenue Canada is undertaking new enforcement measures to address this. Some $3.8 billion of additional taxes have been assessed. More resources are going to our audit program aimed at unincorporated businesses and self-employed individuals and we expect this to bring us further net revenues of about $100 million.
Over two years ago the government consolidated revenue administration at the federal level. Sales, income and excise tax collection were integrated with customs and trade administration into a single department. The integration has performed as expected. By eliminating administrative overlap, considerable savings have been generated for the government. More important, the change has meant better service for Canadians. Administrative costs have been cut and the burden of compliance for taxpayers has been reduced.
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There has been excellent progress, but the job is not finished. The budget confirms that the government will create a new institution, the Canada revenue commission. The new commission will enhance internal efficiency by providing increased administrative and financial flexibility.
The real gains for taxpayers, however, lie in the possibility of greater co-operation between the federal and provincial governments and the streamlining of revenue administration.
We must also ensure that our social programs are affordable and sustainable into the future. The budget contains measures to provide secure, stable and growing funding for health, post-secondary education and social assistance.
The Canada health and social transfer, CHST, introduced last year provides the provinces with enhanced flexibility to design and administer their own programs while safeguarding medicare and other social support.
Since the cash component represents a sizeable part of total federal spending, we could not put our finances on a sustainable basis without reducing the transfers. That is why funding arrangements for 1996-97 and 1997-98 decline.
Following consultations with the provinces, the 1996 budget now acts to extend the CHST but there are no further cuts. We have set out a five year schedule in which transfers grow and the cash component is stabilized and increases over time.
The budget provides additional protection to the provinces. A new cash floor will guarantee cash transfers of at least $11 billion in all years. We also want to ensure that Canada's retirement income system will be there for Canadians when they need it.
Over the next 30 years the number of seniors will more than double while the proportion of Canadians working to support the pension system will decline. Recognizing the wide public concern
over this situation, the Prime Minister has promised to protect the pensions of today's seniors.
Beginning in 2001, a new seniors' benefit will replace the old age and guaranteed income benefits. The new benefit will be tax free and fully indexed to inflation. Those most in need will receive $120 more a year than under the current system. The vast majority of seniors will be as well or better off.
Those 60 and older on December 31, 1995 can opt for the new system or the old one, whichever is more advantageous. The Prime Minister's commitment to our senior citizens will be met and surpassed.
There will also be fairer, more affordable tax assistance for retirement savings. The government is committed to assisting individuals to save for their retirement. At the same time, our fiscal position calls for reasonable limits on the amount that can be saved with tax assistance.
For this reason RRSP contribution limits will be frozen at $13,500 through to the year 2003 but then will increase to $15,500 by the year 2005. These measures will affect only individuals earning over $75,000. Thus, individuals earning less will continue to be able to save up to the full 18 per cent of their earnings.
This is consistent with the government's objective of directing tax assistance to the large population of modest and middle income Canadians. Because our younger population is facing different challenges we have eliminated the seven year limit on carrying forward unused RRSP contribution room.
The budget also introduces improved tax treatment, new guidelines and better enforcement to ensure that adequate child support is paid regularly and on time to the custodial parent.
We are now in a situation in which six out of ten children who live with lone parent mothers are living below Statistics Canada's low income cutoffs.
The Thibaudeau case in the Supreme Court simply brought home what many had been saying for years. We have to make it simpler, faster and more efficient to get child support into the hands of the parents to the benefit of the children.
The government consulted the Canadian public widely on this point. It became clear that few Canadians think it is right to tax child support as though it were the custodial parent's own income. Nor should the person paying the support receive a special tax break merely for performing the ordinary obligations of a parent.
For this reason, child support will no longer be included in the taxable income of the custodial parent, nor will it be deductible to the payer. Custodial parents will no longer have to worry about setting aside a portion of the support they receive to pay taxes on the amounts and payers of the support will not have to make high payments and then wait for the deduction at year's end.
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The working income supplement of the child tax benefit is intended to help low income parents meet the costs of things like transportation and child care when they go out to work. It can also help to compensate for the loss of certain material benefits which parents lose when they go off social assistance to enter the labour force.
To encourage this type of initiative and to help low income families make the transition we are doubling the maximum annual benefit in two stages from its current level of $500 to $750 in 1997 and $1,000 in 1998.
When it is fully implemented, Canada's low income working families will have an extra $250 million annually to assist them with their child care expenses. About one-third of the families eligible for these benefits are single parents. We will thus be targeting what we have identified as a serious locus of child poverty.
The government has taken a number of actions to reallocate funds to increase Canada's investment in youth, technology and trade, all very important areas to Canada's future. To encourage education for young Canadians an additional $165 million over three years is being funded by reallocating money from within the tax system. We are increasing the limits on education tax credits, the limit on the transfer of tuition in education credits and the limit on contributions to registered education savings plans.
There will be more flexible child care expense deductions for low income parents who are in school or attending training programs.
We are creating new employment opportunities for youth by reallocating budget savings. We will double the funds for student summer employment to $120 million this summer. We will increase support for programs like Internship Canada and Youth Services Canada to help young people who have left school to find employment opportunities.
Canada is a nation at the cutting edge of high technology. To ensure our continued predominance in this field, the government is establishing the Technology Partnerships Canada. This new fund will encourage private sector investment in high technology products and processes and assist in technology diffusion. New equity capital will be made available to increase the lending efforts of the Business Development Bank in strategic growth sectors such as the new technology area.
When this government took office it was charged with a double task: to address Canada's increasing fiscal burden without destroying the social fabric that has made this country one of the most
admired in the world. We can achieve this only by ensuring the kind of economic health that made our unique social system possible in the first place.
The government has followed its jobs and growth agenda with one clear objective: to build an innovative economy that will mean prosperity for all Canadians. We are succeeding. Employment in the first quarter was up by 91,000, the largest quarterly growth in two years. The overall unemployment rate is down nearly two points from 11.1 per cent to 9.3 per cent. Interest rates are down and inflation is at its lowest level in 30 years.
Let us give credit where credit is due: to the Canadian people for their resourcefulness in a difficult time, to the private sector for its willingness to partnership and to explore innovative ways of doing business and sharing and joining with government, and to the Minister of Finance for his sure and measured handling of our national finances.
Mr. Jack Ramsay (Crowfoot, Ref.): Madam Speaker, I commend the member for her very clear message.
There are two questions I would like to ask her. The first one centres on the child support payments and the changes there. I believe those changes will cause some concern across the country. The non-custodial parents who have contacted me are very concerned about something that is not mentioned in the proposed bill that will be coming forward, their visiting rights and access rights the courts grant them and which are not lived up to by the custodial parent.
I ask the hon. member if she believes that the visiting and access rights should be linked with the child support payments.
My other question is whether the member sees a danger in the rising debt inasmuch as the interest payments that we have to make on the debt are drawing away from the revenue dollars we need to support our social programs.
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Mrs. Barnes: Madam Speaker, I thank the hon. member for his question.
When there is change there is anxiety about the change. It is true that people will call into a constituency office and say they are worried about the specifics of change which they think could adversely affect them immediately.
The first thing we must say is that there will be clear material given to people so they may understand the changes coming. With this budget we put out a special tax booklet identifying all the questions and answers relating to the changes in support payments.
We did another interesting thing relating to Revenue Canada. We allowed Revenue Canada, after the request from the Justice Department, to get information necessary to enforce payments of delinquent supporters. I believe this measure will go a long way.
I want to make it clear that Revenue Canada will not be releasing addresses to individuals requesting that information. However, we have done something to help with enforcement.
The changes we are talking about do not relate to visitation rights. That is not what we are talking about here. We are talking about tax treatment, a tax policy that will be implemented through the self-assessment process at Revenue Canada, which is the most successful in the world. Canadian taxpayers are honest for the most part. We are hoping to enhance the livelihood and to help with the real economic needs of children in homes where money is due to them from a non-custodial parent. We are changing the tax treatment to make it more efficient, more simple and faster. There will be concerns.
As a government we will spend money to assist in the administrative changes necessary. I can assure the House that the changes were necessary and were done after massive consultations. Members of the government crossed the country over a year ago asking for input from custodial parents. We got the input and we listened. Finally, after nearly a half a century of one system we are about to change and modernize our laws.
[Translation]
Mrs. Pauline Picard (Drummond, BQ): Madam Speaker, I am pleased to take part in the debate on the recent budget tabled by the Minister of Finance. We would have preferred to comment on a budget showing the government's determination to be more effective and to reduce its size and its non-productive interference. However, this is not the case.
We would have liked a budget showing that the government has a minimum of compassion and is sensitive to the plight of our 1.4 million fellow citizens who are jobless and who realize every day that the election promises of ``jobs, jobs, jobs'' were nothing but empty words. Unfortunately, there is no compassion for the unemployed in this budget.
We would have liked a budget showing that the government got the message that we, on this side of the House, have been conveying to it for two and a half years by reminding it of the urgent need to restore justice and tax fairness for overburdened average taxpayers, while companies avoid paying taxes on record profits. Again, this is unfortunately not the case.
We would have liked a budget showing that the federal government had finally decided to put its house in order, instead of resorting to the easier solution of leaving to others the responsibility of taking real measures by dumping its deficit onto the provinces. Unfortunately, this is not the case. The budget that we have to comment on is not of the courageous type. What the Minister of Finance has tabled is in fact a non-budget. It is a kind of economic statement on the country's financial situation, in which everything is explained by magic, that is as a percentage of the GDP, rather than by using actual figures. It is an economic statement which does not propose any real and effective measure to
face the problems that confront us and that can be summarized in very simple and concrete terms: 1.4 million unemployed and a debt of $600 billion.
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Expressing reality in hard figures, rather than projecting it through the rose coloured filter of percentages of GDP, is harsher, as well as less savvy from the political point of view. Harsher, because behind these real figures are real human beings, people who each and every day face the hard reality, real problems, and people who are getting more and more worried.
It is very sad to realize that a sizeable number of our fellow citizens are no longer concerned by government administration, have lost their illusions, can no longer relate to all of the contradictions coming from this government, contradictions raining down on their heads every day about administration, taxation, social services, as well as constitutional matters.
Understandably so. This government had promised employment-remember the red book refrain of jobs, jobs, jobs-and held out great hopes, for young people in particular. But their imagination dried up after they came up with the red book slogan. There had been a government promise to do away with the GST. The Prime Minister said he was going to scrap it, and the Deputy Prime Minister said she would resign if that was not done. This government's imagination was hard pressed to find the most effective means of trying to say what had not been said, and of convincing people that they had not heard correctly.
What people were meant to hear was not that the GST would disappear. What they were meant to understand was that, in light of the present economic situation, and in order to keep the deficit at 3 per cent of the GDP, the GST would have to be harmonized by adding the provincial taxes to it. That is what the members of the government would now like people to have understood, although their main campaign slogan was something quite different.
Strangely enough, today the Minister of Finance is using the same expressions, when speaking on the GST, as the Conservatives used during the election campaign. Within two and a half years, then, our Liberal friends have, in addition to reneging on their promise, espoused the same position as the Conservatives, a position they had so emphatically decried. The government does the opposite of what it says; no wonder our fellow citizens have so little confidence in their political leaders.
Another one of this government's contradictions is its commitment to streamline the federal bureaucracy and make it more productive. They promised the people they would cut fat in order to preserve social programs. What the government is saying in this year's budget is that there is no more fat to be cut in the bureaucracy, when most of our fellow citizens feel that the federal government is living high off the hog.
In fact, as the finance minister's figures confirm, the real budget savings will amount to 0.0 per cent in 1996-97-which is nothing to write home about-and to around 0.2 per cent in 1997-98. We can only conclude that the government feels there is no more to be done in its own backyard and has given up on the greater challenge of reducing the size of the public service. It is, of course, easier to take over the UI fund, cut transfer payments to the provinces, and let others deal with the problems.
The government has brought down a budget with few real measures to stimulate the economy. Yet this budget clearly shows the government's inability to resolve three nation wide problems: the employment crisis, the debt crisis and the constitutional crisis.
This budget contains no concrete measures for the jobless. The government boasts about injecting another $60 million into the summer student employment program and investing $150 million in the technological innovation fund.
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It forgot to mention that what it gives with one hand, it had taken away several times with the other. It cut post-secondary education by $150 million plus another $300 million in 1997-98. In the 1995-96 budget, it cut $32 million from research and development for the Canadian Space Agency, $65 million from the three granting councils, and $11 million from the National Research Council. Those are the facts.
The government fails to provide tax incentives to promote job creation, helps itself to the UI fund instead of lowering premiums, and cuts benefits to workers' venture capital corporations whose sole purpose is to create and maintain jobs by investing in small and medium size businesses. This budget does not stimulate employment, it stifles job creation.
This budget does not contain any new government debt or deficit reduction initiative. Instead of putting its own house in order, the government is shovelling its problems into the neighbours' backyards. The provinces end up having to bear the brunt of the federal deficit reduction effort. While the federal debt has grown by $133 billion since the Liberal took office, tax shelters remain and unnecessary spending continues, including outrageous military spending.
Finally, this budget increases federal government's interference in areas of jurisdiction that are not its own, which is where the very essence of the constitutional crisis in Canada rests. Instead of showing goodwill and withdrawing from areas of provincial jurisdiction, the government is devising new initiatives to interfere even further while continuing to spend and getting deeper and deeper into debt. Three new angles has been found to undermine the
provinces' autonomy, namely the health research fund, the Canada revenue commission and the Canadian securities commission.
This is how, after tabling three budgets, this government has lost any credibility it may have had. It had promised to eliminate the GST, to create jobs, and to steer clear of constitutional matters. It has reneged on its promise in every instance. The people of Quebec and Canada can no longer trust this government.
[English]
Mr. Alex Shepherd (Durham, Lib.): Madam Speaker, I heard the hon. member say in her speech that jobs had not been created.
It always amazes me when opposition members talk that way. All they have to do is get a copy of a report by Statistics Canada and they can see that well over 500,000 new jobs have been created since the last election. In fact, for the last quarter, just about every month there has been new job creation in Canada.
Second, long ago the province of Quebec harmonized with the GST. I will tell the House why this is a good thing for Quebec and Canada and how governments should co-operate and work together. Manufacturers in the province of Quebec have the ability not to include retail sales taxes in the sale of manufactured goods for export. Quebec was clever enough to notice the advantages of harmonizing the GST.
Unfortunately my province of Ontario does not see that. Where I live General Motors is a major manufacturer. The manufacture of automobiles in Ontario includes a certain element of retail sales tax. That gives Quebec a tactical advantage over Ontario in the export of automobiles to the North American market.
I would like to suggest to the member that rather than attacking some of the advantages of harmonization, she should be applauding the government for its foresight in trying to apply the harmonization method that has been used in Quebec across the rest of this country.
Finally, I would like to suggest that if she contacts Statistics Canada it will tell her the net new job growth on a month to month basis. She will see that we have been very successful in creating new jobs in Canada.
[Translation]
Mrs. Picard: Madam Speaker, I will repeat what I said when responding to the speech from the Throne.
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In this budget, taxpayers expected the government to take important measures to get its finances in order and create jobs. Given that 1.4 million people are out of work, the Minister of Finance could have shown a minimum of compassion by introducing job creation initiatives. This is what matters at this point in time.
I am not an expert in the fields of finance and economy, but I do know, like everyone else, that when people have jobs, they pay taxes and that helps the economy. Putting people to work might help reduce the deficit. However, as long as the government keeps trying to cut here and there, particularly at the expense of the poor and of the unemployed who truly need help to find work, it will not succeed in promoting economic recovery.
Mr. Gaston Leroux (Richmond-Wolfe, BQ): Madam Speaker, as official opposition critic for heritage and cultural industries, I cannot stop myself from referring to the throne speech in my response to the budget speech.
What is written in the conclusion to the throne speech must be noted as something of great importance to the cultural industries, ``Culture is at the core of our identity as Canadians. The Government is committed to strong Canadian cultural industries''. This speech also confirms the government's desire to ensure the viability of the CBC, the National Film Board and Telefilm Canada. The statements of principle in the Minister of Finance's speech are, however, unequivocal. The Liberals want to reduce expenditures, while at the same time encouraging improved job prospects. Such a contradiction! Regrowth and reducing expenditures in the same breath. They claim to have a strategy which works via reallocation.
Let us be serious now. Contradictions do not belong in administration. The Liberals are full of great statements of intent, which we all know very well they have no intention of putting into practice. This government's sole objective is to make cuts, and its true cultural policy is to make cuts in culture. With a policy applied to strategic sectors that is threatening social cohesion through massive budget cuts, and threatening economic growth through a systematic layoff policy, we cannot look at the future with any hope.
Yet, if there is one sector that is strategic for maintaining cohesion and social equilibrium in Canada and in Quebec, it is culture. And what is this government doing? In the Liberal Party of Canada's budget, national cultural institutions are facing cuts of 9.7 per cent. Telefilm Canada, the NFB and the National Archives are the most affected, moreover. Let us take an example. The CBC alone is being hit the hardest, with cuts of $102 million between fiscal 1995-96 and fiscal 1996-97. According to Mr. Beatty, its president, there will be additional cuts of $48 million.
Telefilm Canada will face cuts of $19 million in the upcoming fiscal year just when it is looking at the possibility of going multimedia. The National Film Board alone will be hit with cuts of $10 million on top of the $16 million cuts in the 1994-95 budget.
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The National Archives will be cut by $11 million. Publishing support programs will be cut by $14 million, and the heritage and cultural development program will cut by $22 million in the coming fiscal year. Contributions to the cultural infrastructures project will be cut by 69 per cent in 1996-97, on top of the 44 per cent in 1995-96. This is totally unacceptable.
I ask this House if this the expression of a desire to develop cultural industries in Quebec and Canada. How can the Liberals claim to be promoting job creation with such cuts? How do we assure the long term viability of the CBC, the NFB and Telefilm Canada? When the government systematically cuts the operating budgets of these organizations, there is no guarantee of a future.
When everyone knows the importance of our cultural institutions, how do we convince the government that it is heading in the wrong direction? This lack of political will to develop the cultural industries is having a dramatic impact, let us face the facts, on lost jobs.
The $227 million cut from the CBC since 1995 represents 2,400 lost jobs, and the forecast cuts of $150 million between 1996 and 1999 will mean another 2,500 positions, making a total of 4,900 jobs lost in the years the government is giving expression to its alleged intention to develop Canada's cultural industries.
Such job losses have a significant impact on the cultural fabric of society in Quebec and Canada. Culture is made up of real people: actors, screenwriters, authors, musicians, performers, composers, model makers, make-up artists, costume designers, scenic artists, and others. They are the raw material of cultural creation and production. The very essence of our identity could be ruined and driven to despair by this Liberal government's extensive cuts and lack of strategy, vision and policy in cultural matters.
The prospect of an Anglo-American culture threatens our culture, as everyone knows. The Canadian Minister of Finance's budget is a major culprit, as it jeopardizes the very existence of our cultural industries.
That is one of the reasons why the Government of Quebec claims full responsibility for the management of its share of the federal funds allocated to cultural industries. The federal government's estimates for heritage and cultural industries directly threaten all of us as a culture. In these circumstances, the Bloc Quebecois, as the official opposition, urges Ottawa to withdraw from the whole area of culture and communications. While the Government of Quebec was increasing its contribution to cultural funding by 4 per cent a year and its share of all public expenditures affecting Quebec culture from 32 to 37 per cent, the federal government's contribution fell from 45 per cent in 1989-90 to 34 per cent five years later.
According to Louise Beaudoin, Quebec's Minister of Culture and Communications and Minister responsible for the Administration of the Charter of the French Language, although Quebec makes the greatest effort in Canada, it is not enough to compensate for the federal government's gradual withdrawal from culture. It is certainly logical.
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At a time when Quebec is taking action and increasing its budgets to ensure the viability and development of its culture, the federal government continues to withdraw and to cut funding. The Government of Quebec has no use for the more or less political goals pursued by the Department of Canadian Heritage through the distribution of millions of flags. At a time when everything is being cut, they suddenly found $17 million and hired 10 full time telephone operators to handle callers who want the flags promised to them by some deputy minister. As we speak, at a time when everybody is being hit by budget cuts, including those who create our culture, who guarantee our identity and development, they have just spent close to $7 million.
Meanwhile, on the other side of the Ottawa River, the federal government plans to reduce the funds spent on culture, something that would greatly compromise our cultural future.
In closing, this budget shows once again the government's inconsistency and lack of vision and respect for Quebec culture. We must, however, admit that the federal Liberal government is true to itself, making and breaking its own promises as it pleases.
Mrs. Eleni Bakopanos (Saint-Denis, Lib.): Mr. Speaker, what our friend opposite said about protecting culture is most interesting. A question comes to mind however: What culture is that? The Canadian culture, which includes the Quebec culture? Or are all cultures lumped into one?
I think the best way to protect a culture, a language or a people, as our friends opposite would say, is through the Canadian government, the federal government, as opposed to the provincial level of government. The measures we have adopted in this budget are but one way of ensuring that a typically Canadian culture is preserved, so to speak.
Mrs. Picard: That is blackmail.
Mrs. Bakopanos: Blackmail yourself, Madam. Let me speak.
The Acting Speaker (Mr. Kilger): I understand that the debate could excite emotions and even convictions, but I nevertheless ask the co-operation of the House in please addressing the Chair when making remarks.
Mrs. Bakopanos: Mr. Speaker, the opposition keeps attacking the budget put forth by our government by using intimidation
regarding the culture preservation issue. As I said before, as did several other speakers, the budget has put in place measures to ensure that funds are available to preserve our culture as weknow it.
The fact remains that culture-perhaps the opposition will disagree-is something that evolves. There is no such thing as an unchanging culture. It grows and gets better over time.
Moving to other budget issues raised by the hon. member, the preservation of our social programs and the sacrifices that had to be made in the system we have enjoyed in Canada, we can be thankful for the measures that we have taken as a government to ensure that sufficient funding will be available to continue preserving the French language across Canada and preserving French language programming across Canada. The survival of the French-Canadian language and culture in Canada is guaranteed through the measures put forward in this House by the Minister of Finance to ensure that funds will be available.
Mr. Leroux (Richmond-Wolfe): Mr. Speaker, I wonder on which planet the hon. member for Saint-Denis lives, given what she said about subsidies being given to French speaking communities everywhere. She should reread this blue document called the budget. She will realize that there are cuts, year after year, and that the assimilation rate keeps growing. It is time the hon. member woke up.
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The hon. member claims that her government provides many good things in its budget for culture. Let me just remind her of a few facts which she does not appear to have figured out: the CBC, cuts totalling $150 million and close to 5,000 jobs eliminated; Telefilm Canada, cuts of $19 million; the National Film Board, cuts of $10 million; the National Archives, cuts of $11 million; the writing and publications program-books are important, our authors tell our story-cuts of $14 million; heritage programs, cultural development, cuts of $22 million.
Please, wake up. These are cuts, not support. These are cuts and when cuts are made, it results in a reduction, not an increase, in production and in the number of jobs.
It is time to wake up and realize that the budget tabled in this House does not promote cultural development and does not in any way support one of the main recommendations made in the Juneau report, which provides that we should not only ensure the recognition of our cultural institutions such as the CBC, Telefilm and the National Film Board, but also their long term funding. Not only does this budget not follow up on these recommendations, which have gained unanimous support, but it also cuts everywhere, thus creating losses of jobs and services, while jeopardizing cultural development as a whole.
[English]
Mr. Harbance Singh Dhaliwal (Vancouver South, Lib.): Mr. Speaker, it is my pleasure to speak to the budget which was introduced by my hon. colleague, the Minister of Finance.
There has been much discussion both in the House and in the homes of Canadians since the budget was brought down in early March. The overwhelming consensus is that truly this is an outstanding budget. Editorials from St. John's to Vancouver have hailed it as a major step forward in the fight against the deficit and to protect social programs. I know the Reform members would not know much about social programs.
Let us look at the economic and fiscal framework in which the budget is presented. We should take a moment to recognize the achievements of this minister. First of all, his tenure in the finance portfolio has been marked by a measured, balanced and disciplined action.
Let me just repeat for some of my colleagues that this is a balanced and measured approach. I know some members would say that we have to cut and chop everything out of government. However, Canadians see that the position the government and the minister have taken to have a balanced approach. An approach where we deal with the deficit on a year by year basis is the right approach, instead of ignoring the problem which some of our members would like to do. Other members would like to slash and burn. As Liberals we know that is not the right way.
When the Liberals took office, the country's finances were in a disastrous state. There was no vision and no plan. Under the finance minister's stewardship, the government has worked with Canadians to craft a sound economic vision for the future.
The Liberals realize that the deficit, employment, economic growth, inflation and taxation are all interrelated. That is why we need a sound economic vision for the future of our country. That is why the budgets have been structured with an integrated economic framework.
Just two and a half years after the Liberals assumed office the outlook for Canada is much brighter. The results of the fiscal framework are the following.
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For example, short term interest rates have fallen by three percentage points in the last year alone. Imagine how much money Canadians are saving. People who have mortgages, people who finance their automobiles are saving a lot because short term interest rates have dropped. Something which I did not think would happen has happened. Overnight, interest rates are now lower than those in the U.S. This is a sign that the markets have confidence in this government and its economic policies.
In the last 13 months 263,000 jobs have been created. Since 1993 some 600,000 jobs have been created in the Canadian economy. Inflation is the lowest it has been in 30 years, reflecting solid productivity growth and virtual absence of cost pressures.
Let us compare Canada to other countries. On an international basis relative to other G-7 countries, our finances appear to be on a sound footing. Our financial requirements, deficit to GDP, our rate of inflation and unit labour costs are all looking good when we compare them to the G-7 countries. Of course, we cannot rest on our laurels for there is still work to be done but these numbers are sure signs that progress is evident.
We have seen in the international community how much more confidence there is by looking at interest rates, by looking at the targets we have met. So far we have been able to meet and do better on every target. The international community has a tremendous amount of confidence in us for when we say we will deal with the deficit we do, not through words but by action.
This budget represents another important part of our coherent and integrated plan to modernize government and to put in place the fiscal ingredients for a prosperous Canadian economy.
The major thrust of the budget is the future. Specifically, it speaks to our future by restoring health to public finances, defining a more appropriate role for the federal government in today's economy and federation, and by taking direct action to secure social programs for the future. It is very important to emphasize that we are taking direct action to secure our social programs, laying out a plan to restore confidence in our public pension system.
As the finance minister indicated in his budget speech on March 6, this budget is about addressing problems before they arise. It is about managing ahead and continuing to put in place new building blocks for security and prosperity. This is important because as we know we are in an age where social and economic transformation is occurring at a frightening speed.
Looking at the budget we can recognize the change that is coming in our society, the roles that information and technology are playing. That is why we are investing in those areas. That is why we are investing in our young people who are getting involved in helping small businesses take advantage of the information technology.
In British Columbia young people are working with small businesses. We as a government along with the private sector have said that we need to make sure that small businesses take advantage of the existing technology. That is why we are trying to bring our youth and small business together on programs that will take advantage of the information technologies.
That is why Canadians have given this budget glowing reviews. It minimizes the uncertainty of our future by simultaneously creating economic opportunity and safeguarding our cherished social programs.
British Columbians are very satisfied with the budget. I want to take this opportunity to explain why this budget is a good one for British Columbia.
Many of the Reformers are very supportive of this budget, particularly on our success in dealing with the deficit. Reformers have to understand that this government will not gut our social programs like they would do, nor would we destroy our cultural industries like Reformers would do. We will continue to ensure that we have social programs and that we support our cultural industries as this budget does.
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The reaction in my home province and in my riding has been overwhelmingly positive. That is why the Liberals are over 50 per cent in the polls in British Columbia and Reformers are down to 20 per cent or less in British Columbia. They only have one issue and that is the deficit and it is no longer an issue because we have broken the back of the deficit. They are looking for other issues all the time and are unable to find them.
There are three or four issues which are near and dear to the hearts of the citizens of my province and the people of my riding. We all know the figures by now so there is no need to reiterate them. Perhaps we should ask why our success in reducing the deficit is important. There is a link between deficits and our goal of jobs and growth. That is our ultimate goal, jobs and growth. We want to create an environment where the private sector can create those jobs and growth.
Pursuing a lower deficit helps to keep our inflation and our interest rates low. Low inflation helps to smooth the bumps of the boom and bust economic cycle. It also helps to keep interest rates low. Low interest rates in turn help to stimulate demand in interest sensitive industries, foster high levels of investment and keep Canada competitive relative to our global competitors.
We have started this process of fiscal recovery. By doing this we can eventually attack the debt, and we will attack the debt, which as we all know consumes more than one-third of federal revenues. For the first time in decades, British Columbians know that when the finance minister says he will balance the books there is real substance behind the promise.
This budget speaks volumes about the differences that exist between this government and other parties in the House. The Liberals are a true national party which effectively represents all Canada's regions and people across the political spectrum.
Members of the Reform Party say theirs is a national party but we have not seen that. In every byelection the Reform Party has
not been able to prove it is a national party. It has been a disaster. In not one of the byelections was the Reform Party able to make any substantial effort or win any seats. Reformers have a long way to go to prove it.
The Liberals are a true national party which effectively represent all of Canada's regions and people across the political spectrum. We do this by providing government that is open, honest, forthright and rational. We recognize there is a fundamental need to change the way government works. We have not retreated from the task of bringing Canada into the 21st century. Instead we have enthusiastically embraced this challenge by recognizing that difficult decisions must be made.
In making these decisions we have found the balance between retrenchment and social justice. We have shown Canadians and indeed people around the world that it is possible to protect the social safety net while restoring integrity to our nation's finances.
Mr. Ken Epp (Elk Island, Ref.): Mr. Speaker, I would like to ask the member a very short, directly answerable question. I would like to place a bet with you, Mr. Speaker, that he will not answer it. I cannot do that, I am sorry.
The Acting Speaker (Mr. Kilger): I have been known to take a flyer or two on a few tips but I do not think we should engage in that sort of game.
Mr. Epp: My apologies, Mr. Speaker. We will have to see how this speculation ends.
The hon. member knows a lot about business. If he were the chief executive officer of a corporation and when he took over the debt in that corporation was around $40 million and after four years it had grown to $50 million, would he be applauded by the shareholders? I would like the hon. member to give me a yes or no answer and I think he will not.
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Mr. Dhaliwal: Mr. Speaker, if the hon. member is concerned about direct answers he should talk to his leader. The last time I asked him a direct question about his party's stand on the turban issue with the RCMP, the leader of the Reform Party refused to answer. I am glad that some of the members have now brought this forward as an issue and they may deal with it at the next convention. If the member wants a direct answer he should start by talking to his leader so that he does give a direct answer when he is asked a question in the House.
In terms of corporations let me say that government is not a corporation. Some members of the Reform Party have to learn that you cannot try to compare a corporation with government. In government we are dealing with people. We are not dealing with the bottom line.
It used to be said that what is good for GM is good for this country. We have learned that sometimes what is good for corporations is not good for the general population. It is not good for Canadians. We are ensuring that we have a vision for the long term for our future generations, for our children, our grandchildren and their grandchildren. We do not look at just the bottom line. We look at our future to make sure that we have a quality of life we can be proud of and we can tell our future generations that we worked toward that. We cannot compare a corporation and government.
We are concerned with the debt. The first thing we said as a government was that we were going to deal with the deficit. We cannot deal with the debt unless we deal with the deficit. We have put forward a constructive program to deal with the deficit. The international community knows that when we say we are going to deal with it we are dealing with it.
Once we have dealt with the deficit the next step obviously is to deal with the debt. We will be dealing with it but we have to do it in a balanced, rational and a measured approach so that we ensure we are sensitive to the human dimension of cutting deficits and cutting budgets. The way we are doing it will be seen in history as the right way.
Mr. Leon E. Benoit (Vegreville, Ref.): Mr. Speaker, since this government has come into office and as a result of the budgets the finance minister has put forth so far the debt will increase by about $120 billion. The debt is ever increasing with no sign of that increase ending.
The government has made some cuts in spending but those cuts have been more than lost due to increases in the interest payments it takes to service the debt. The only reason deficits are decreasing in the projections is due to increased revenue, more money brought in by this government from taxpayers. Is this situation satisfactory to the member?
Mr. Dhaliwal: Mr. Speaker, first let me correct the facts. For every seven dollars cut there is only one dollar on the revenue side in action taken by the government. We have cut seven dollars for every one dollar of revenue whether it is through fees or in some other way. It is not accurate to say that most of the changes came about as a result of a change to the revenue side.
The approach this government has taken has not been to cut everything by 10 per cent or 20 per cent. We said let us look at government and see where we can improve, where we need to cut and where we need to add. Let us see where we need to add more money to government so that we have a core government, that we have an efficient government and we have a government that is working for the people of this country and not just a straight percentage cut everywhere. That is why we looked at the priorities of what is important for Canadians before we made the changes that we did in the budget.
Ms. Albina Guarnieri (Mississauga East, Lib.): Mr. Speaker, in less than a single full term in office this government has managed to cut the national deficit by $20 billion and at the same time cut the unemployment rate by a full two percentage points.
Canadians can have more confidence in how they are governed now that they have a Minister of Finance who sets and reaches ambitious fiscal goals without the destructive consequences of public service walkouts or wholesale elimination of service. Successes come from abandoning the failed policies of governments past.
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A sixty per cent cut in subsidies to business was born from the realization that little can be gained by collecting taxes from business with the sole purpose of redirecting the same dollars to the same businesses through subsidies and grants. We have learned that the value of targeting funds is small and more than offset by the consequences of increased taxation, administrative overhead and the cost to business of hiring consultants and lobbyists to apply for grants.
It was a typical case in the previous regime that $100 would be taxed away from an industry with $1 or $2 spent in the collection process, as much as $20 more spent on grant administration and the remaining $78 dollars would be handed out to business as a great gift. However, $15 had already been spent by business trying to get its tax money back by hiring consultants and applying for grants.
At the end of the rinse cycle industry would be about 35 per cent better off had the government just stayed away. We have done away with tax and grant government. We no longer believe that the role of government is to seize and reinvest the earnings of private corporations.
Rarely has economic success ever been built on temporary grants and subsidies. It is true the odd business may be lured to set up a factory by the promise of grants, tax credits or some other concession paid for by the local businesses. It is also true that often these factories vanish as soon as the locks get changed at the house of the free money.
Government grants impose a psychology on business that slows sustainable job creation as entrepreneurs wait for handouts rather than accept private sector funding under market conditions. It is not rare to hear of a small business owner planning an expansion which might create 100 jobs. Typically the entrepreneur could find the money needed from private resources or a bank or venture capitalist, but then the prospect of the government grant would get in the way.
The entrepreneur would start spending his time visiting bureaucrats, filling out forms, preparing his case. Pretty soon he would get frustrated and hire a consultant who specialized in positioning companies for grants. The process would drag on for months. A hundred people were still out of work but our entrepreneur would sense the competition. If he did not get a grant his competitor might then be able to undercut his price. He would have to press on. More months would pass with still no word, still more consulting fees, still no jobs created.
Finally there would be a sigh of relief with rejection letters from all granting agencies. Now our entrepreneur could actually carry on his business, creating jobs by using private sector resources for private sector results.
Many forms of subsidy will remain in selected fields and to support exports. Generally business is being freed of having to apply to government for funds to stay competitive. Overwhelmingly the government is being reduced to a level that can actually be understood by citizens who are too busy working and paying taxes to study every branch or tentacle funded by their tax dollars.
The confidence the public has shown in the government and the Minister of Finance arises from our efforts to limit government to its original and irreproachable aims. In 1997-98 total program spending will fall to about $106 billion. Fifty-four per cent of this spending will go to seniors, the unemployed and to the provinces to support education, health and other social programs. Business subsidies by contrast will account for barely one and one-half per cent of program spending.
By the conclusion of our first term in office, the taxpayer will be comforted to know that fewer and fewer hard earned tax dollars are leaking away from the core of government's role. Government will soon be able to say it is doing only what it does best which no one else will do.
Our role is largely to redistribute cash to help seniors, the unemployed, low income earners, provinces with smaller per capita tax bases as well as support our national medicare system and affordable post-secondary education.
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Some have criticized these programs, saying their home province is spending more than it receives, say from the employment insurance plan. This plan is about people, not about provinces. It is intended to treat individuals fairly according to the unemployment levels they face where they live.
Politicians in wealthier provinces who protest relief going to people in need in other provinces represent a view of the country shared by Lucien Bouchard, always calculating their share, discounting what they receive, focusing on any area where they pay more than they get back and never viewing Canadians as equal members of a single nature who have a long history of helping each other through hard times.
This 1996 budget does not give in to regional parochialism or selfishness. It preserves the Canadian sense of community by sustaining our social fabric while finding necessary savings in subsidies, administration and by closing tax loopholes.
In short, we have reduced Canada's deficit without reducing Canada.
Mr. Elwin Hermanson (Kindersley-Lloydminster, Ref.): Mr. Speaker, I have been in the House for a while now listening to some of the Liberal members who spoke. I have to admit that most of what they say sounds like it has been written by a speech writer in an office tower who is totally unattached to Canadian reality.
There is an occasional paragraph in some of the speeches where a few words have been added, but most of it sounds like pure political drivel by someone in the finance department trying to justify a rather uninspiring budget with accolades that are not shared by Canadians and which do not reflect the response Liberal members are getting from their constituents.
When looking at the budget we begin to see there are perhaps some changes coming for old age pensions and for CPP. There are some signs that perhaps the Liberals will not keep their promises. Liberals are great for not keeping their promises. They changed their minds on the free trade agreement. They said it was terrible and now they support the free trade agreement.
They said some things about the GST and they have been back pedalling awfully hard on that one. Why should Canadians believe one thing these Liberals are saying?
I believe that because of the fiscal mismanagement of the country, one day the Liberals will have to get up in the House and say: ``Sorry, old age pensioners, you will lose your old age pension even if you are low income''. They will say: ``Sorry, we mismanaged your CPP funds and you will lose them. We meant to tell you sooner, but we just did not get around to it''. They will tell our young people: ``Sorry, we have to raise your taxes. We did not do things quite right in the past. It just kind of crept up on us. We did not mean it to happen. That is the reality of the times''.
Our debt is increasing at an enormous rate. In spite of all the drivel we hear from the Liberal members, the truth is our debt has increased by almost $100 billion since the Liberals took over and the interest payments on the debt are approaching $50 billion every year. This from a government that only gets a little over $100 billion in revenue each year and is spending about $160 billion each year. It is atrocious. It is terrible.
I wish the Liberals would come to their senses and recognize the seriousness of the situation and be prepared to do something constructive about it before they lose all of the so-called social safety nets they claim to be the champions of. It will be the Liberals who will destroy all of our social safety nets by pretending there is nothing wrong with their budgets or with the ongoing deficits they have been ringing up not only in this decade but in previous decades to the tune of almost $600 billion to date.
I had to get that off my chest because I am extremely upset that they would mislead the Canadian people by letting them think everything is okay.
I want to direct most of my speech today to the agricultural perspective of the budget. As agriculture critic I am very concerned about what the budget states with regard to agricultural issues. There are a few issues that need to be discussed today.
There was a formal announcement in the budget of the government selling off 13,000 grain hopper cars. This was not much of a surprise because it had been discussed and the government's intention had been made known before the budget was release. It became very clear the government was prepared to go ahead when the budget was released in March.
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The so-called SEO group, the senior executive officers, made up of executives of the railways, elevators and other key players in the grain industry was set up last year by the federal government to develop a set of recommendations regarding future grain transportation systems in western Canada. In its set of recommendations to the Department of Transport and Department of Agriculture and Agri-Food last fall, the disposal of the hopper car fleet was considered. The railways would purchase these 13,000 cars on the condition that they be used to transport western grain. The cars would be sold for $100 million and the purchase cost would be recovered over five years through an approximate one dollar a tonne rate increase in transporting grains.
This all seems to be going down the drain. The recommendations for the car disposition seems to be derailed and any idea that the railways will be receiving the cars is very slim at the current time, which is not necessarily bad. Subsequently, a coalition of farm groups has banded together to develop proposals to buy the hopper cars. The primary objective of the coalition is that all 13,000 cars be sold together, that they be operated as a common fleet and that the first priority of use will be moving western Canadian agriculture products.
Members of the producer coalition have been critical of the federal government, suggesting it is difficult to develop a business plan or arrange financing until they know what the selling price of the cars will be.
I might use the illustration of a used car salesman. If any member of the House was to buy a used car and went to a used car lot, they would see a car and would ask the salesman the price of
the car. Our used car salesman, the minister of agriculture, said he wants to sell his used hopper cars to Canadian farmers but that there is one little catch, he will not tell them the price of these hopper cars. He wants the farmers to put together the financing by going to the Farm Credit Corporation or some leasing company and make all the arrangements and then he will finally get around to talking price a ways down the road.
We have heard of some pretty shady used car salesmen in the past but I certainly do not think farmers appreciate the used hopper car sales approach that is being used by the minister of agriculture.
In the budget the Liberals laid out a proposal that was far from specific and raised more questions than it answered: ``The government will examine proposals for the acquisition of the cars, taking into account the interests of producers, shippers and railways and the need to make the most efficient use of the cars. The Minister of Transport will be authorized to adjust regulated freight rates effective August 1, 1998 by 75 cents per tonne on average to cover the cost of the acquisition''.
Shortly after this announcement it was reported that the government was looking for somewhere in the neighbourhood of $250 million for the cars. However, this was only a rumour. There was no substantiation and no firm proposals put forward. There was no explanation as to how long the 75 cent per tonne surcharge would remain. There was no explanation as to the replacement process for replacing these hopper cars. There was no suggestion as to how they might be maintained. There was no suggestion as to how they might be allocated.
What the Minister of Agriculture and Agri-Food and the Minister of Transport are asking are for farmers to buy these cars. They will have no locomotives to pull these cars. They have no idea as to what kind of an allocation process will be put in place for these cars. Yet they are supposed to put the financing together and go storming ahead with this process.
It sounds an awful lot like the way the minister of agriculture handled the whole Crow situation. When the Crow buyout was announced it was supposed to be offset by efficiencies in rail transportation. The problem is the minister of agriculture forgot to address the issue of the efficiencies before he ended the Crow. It was kind of like putting the cart in front of the horse.
Certainly in this whole Crow fiasco there were a lot of mistakes made. Certain crops like forage were not included in the payment even though they were part of the regular rotation of eligible crops. There were instances where a renter and a land owner were going to arbitration and it was costing them an exorbitant amount, anywhere between $500 and $1,500 a day for arbitration for a cheque that may not be much more than that.
Cheques were to be mailed out in January. However, there are still constituents in my riding of Kindersley-Lloydminster who have not received that initial Crow buyout cheque.
I was talking to some people from the Farm Credit Corporation. I told them this whole Crow buyout plan allowed that the payment would be going to FCC for land they held and was being leased by a customer. If the customer chose to use that money as a down payment they could purchase their land and get it back. I asked how this plan worked. The corporation said it was really not working at all because they had to meet a December 31 deadline and many of them still did not have their initial Crow payment.
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They were not able to put together interim financing. They were not sure what the amount would be. Therefore, he said: ``It is very rare that you would see a client of the Farm Credit Corporation using the Crow buyout as a down payment to repurchase his land''. There was some very bad planning in the whole process.
Let us go back to the grain hopper cars. It makes sense for the government to develop a clear plan of action rather than taking the ad hoc approach that we are becoming quickly accustomed to in this House.
The minister of agriculture has stated publicly a bias in favour of some form of producer ownership. If the government would like to see the hopper cars go to the producers, it should develop a transparent and open framework that will accomplish that. The minister of agriculture should not be giving the producer coalition preference when he cannot guarantee the cars will be sold to the producers.
Second, if the government has already made up its mind who should own the cars, there is very little point in having a lengthy consultation process to arrive at a conclusion that perhaps is predetermined. There has been no openness in discussing the negotiations or the intentions of the government other than the minister's expressed wish that the producers somehow buy the hopper cars without knowing the details.
According to the budget, the bottom line is that the hopper cars will be sold. They should be sold. While the government should attempt to get a reasonable amount of money from the sale, producers that utilize the rail system should not be pained unnecessarily for paying off the cars. The ending of the WGTA subsidy has already increased farmers' transportation costs on average by 75 per cent. What is needed in the car disposition process is a clear and concise strategy that will prevent the process from going off the tracks.
The agriculture minister failed in the whole disbanding of the Crow. He is failing on the hopper cars. He failed on the durum trade
dispute Canada had a year or so ago with the United States and he failed on the transportation bill, Bill C-14.
The minister of agriculture spoke to a meeting of the Saskatchewan Wheat Pool in my province and indicated that he would be a point person, the person who negotiated the best possible transportation act for prairie producers.
Every prairie representative who I know that came before the transportation committee said that there were fundamental flaws with Bill C-14 which needed to be changed. If it would be enacted, it should be fair both to shippers and the railways. The minister of agriculture failed to represent that interest, which showed how hopelessly inadequate he was or how inconsistent he was in keeping his word.
I want to briefly touch on the reduction of the dairy subsidy and the creation of a single federal food inspection agency, which are also parts of the budget.
With regard to the reduction in the dairy subsidy, the Reform Party has stated that the supply managed sectors must not rely on federal subsidies to sustain their existence in the marketplace. Instead, producers must rely on their competitive advantage and create an environment that is viable, self-reliant and market driven.
The Liberal government has failed to come clean with producers when it told them that the status quo approach with a few cosmetic changes would allow the supply managed sectors to go unhindered into the 21st century. Once again, the government has relied on an ad hoc approach to the detriment of Canadian farmers.
As far as supply management is concerned, before the election Liberal candidates and Liberal members of Parliament were suggesting that article XI was safe, that they would defend article XI under the GATT. Once they got into power, they quickly broke that promise as they broke many others. They said, sorry, we did not have enough support in the international community. We had to break our word.
I fear that the Liberals are doing the same with supply managed industries. They are making promises that they are not going to be able to keep and that is unfair.
One of the promises they broke was the discontinuation of the dairy subsidy. I heard nothing prior to the last election that a Liberal government would discontinue the dairy subsidy. In power, that is what it has turned around and done.
Reform was very open. We had a dialogue with the supply managed industries. We said that in the overall scope of things we would reduce and eliminate the dairy subsidy, but we would do it in co-operation with the industry. The industry would know what was going on and there would be other avenues that it could follow to compensate for the losses the farmers would have.
The Liberals were not open and straightforward with the industry. They mislead the industry and now they are pulling the rug out from under an industry that was not prepared to deal with the end of the dairy subsidy. That is not good government and that is not a good way to deal with the agriculture sector.
As far as the single food inspection agency is concerned, that is a positive development if it brings about the forecast of expenditure reductions and if it continues to provide the service that is required.
(1750 )
It is about time the government realized that amalgamating the same services of three departments under one department will promote efficiencies financially while reducing the duplication among various levels of government and government departments.
It is clear that some of the other federal departments should follow this and reduce inefficiencies. We have to be vigilant to make sure that the government actually reduces the departments where there is overlap rather than reshuffle people around, create this new single inspection agency, but yet keep unnecessary bodies around in the other three departments because it is not prepared to make the cuts and do the decisive things that need to be done in the department of agriculture.
The Liberal delay in addressing the deficit will cost Canadian taxpayers in excess of $10 billion. If Canadians would have elected a Reform government in 1993, by the year 2000, taxpayers would have been $10 billion better off than they are under this Liberal government because of its mismanagement of the economy and of the budget.
A Reform government would have halted this waste by balancing the books more quickly. Furthermore with a balanced budget taxpayers would see a sustainability of funding for social programs and tax relief.
That is the compassionate way to deal with seniors. That is the compassionate and right way to deal with our youth. That is the right way to deal with the agriculture sector as well.
The sustainability of Canada's social safety net, job creation and a prosperous farming sector can only be achieved by creating a healthy economy through a balanced budget, reduced federal spending and a shrinking federal debt which will result in modest surpluses and a growing economy. That comes from proper management and proper budgeting and a finance minister that has more courage than our current finance minister.
Ms. Albina Guarnieri (Mississauga East, Lib.): Mr. Speaker, I simply could not let the member's words about drivel go unnoticed.
I wonder if he would agree with Bill Good, B.C. based radio call-in host, who said on CTV's ``Sunday Edition'': ``What Paul
Martin has done is gathered a considerable amount of credibility by hitting the targets that he has said he was going to hit, that is keeping interest rates relatively low because international investors now believe Paul Martin is serious about deficit reduction''.
Would he also agree with Jeffrey Simpson, Globe and Mail columnist who said: ``If only federal governments 10 years ago had introduced budgets like the last two, including yesterday's-The fight against deficit-debt has been waged thus far successfully without major tax increases to which Canadians have become politically resistant. It has instead been fought where it belongs, in the government's own spending and in transfer to the provinces''.
Would he agree with the Montreal Gazette editorial: ``For the most part Mr. Martin deserves praise for keeping his government's promise to keep federal finances under control without damaging the core of the country's social services and without hurting too many people too badly''.
Perhaps he would agree with Jason Moscovitz that the reason for the drivel of the member's opposite is that, as Mr. Moscovitz said: ``With the Liberals showing the deficit declining, the Reform Party appears to have been caught flat footed. Paul Martin had a day he may not soon forget. In straight parliamentary terms he beat up the opposition-
The Acting Speaker (Mr. Kilger): I hesitate to interrupt at any time but I think it is important to remember that although sometimes we might quote from any publication, the rule of the House is that we cannot do indirectly what we cannot do directly. In other words, directly we would not name the Minister of Finance. We would refer to him as the Minister of Finance.
I know we have been away for a few weeks and we are a little rusty. I just bring that to the attention of the House once again. I think the question has now been put.
Mr. Hermanson: Mr. Speaker, it was interesting. What the member was doing was quoting from the Liberal finance department's briefing notes. This is what the hon. member should say in response to Reformers. Use this quote, this quote and this quote, and see what happens.
I am not sure of the economic credentials of some of the people who wrote some of those articles. I am sure they are all excellent journalists in one form or the other. A lot of what the member said is true. The finance minister has hit his target.
Actually, Mr. Speaker, if you put a string a foot above the foyer I could jump over it without any problem. If you put the target up where it should be, where I would be competitive, in my case it still would not be too high because of the shape I am in. Let us say three or four feet and then it would be a challenge.
(1755)
The finance minister has set his sights very low. He is certainly hitting his targets but he is doing it at great cost to future generations. Low income seniors will not have their old age pensions and CPP because of the finance minister's low targets. Young people today, our kids and our grand kids will be paying taxes that they cannot afford to pay and they will be looking for jobs that are not available because the finance minister set his targets far too low.
Mr. Simpson said that this should have been done sooner. It certainly should have been done a whole lot sooner. The debt was $17 billion in our centennial year. Now the deficit is $30 or $40 billion a year.
One of the worst finance ministers during that period is the current Prime Minister. He started us down the wrong road. The Mulroney government came along and it could not fix it either. Canadians finally started getting mad and now they are electing Reformers because they realize they were headed on a course to disaster if we do not get the federal ledger balanced and get it done soon.
As far as Mr. Moscovitz is concerned he is a great reporter. I enjoy watching his show. He is always entertaining but he reminds me in that statement of a lot of reporters who said in 1988 that the Reform will never elect an MP. These are the people who said that. ``They will never elect an MP. You will never see one of them sitting in the House of Commons''. In 1989 we elected our first MP.
They said that Reform would never get anywhere outside of western Canada and it will never be anything more than just a rump in the west. We hold the majority of seats in western Canada and we elected a member in Ontario. We were the second strongest party in Ontario.
The other day we almost won a seat in Newfoundland where the experts had written us off and said we would never even get a toehold.
Mr. Moscovitz may be wrong. We see the Liberals breaking their promises, taking away OAS, not being able to fund CPP, not being able to support post-secondary education. Then Canadians will say the Liberals betrayed us, the Reformers were right and that is where we had better put our stocks in the future.
The Acting Speaker (Mr. Kilger): Before I resume debate, earlier an hon. member raised the issue of a wager. The last member who spoke made mention of how high he might be able to jump. That might make for an interesting wager.
Let me see if I can get some clarification here. Is the hon. member for Elk Island seeking the floor for debate?
Mr. Epp: Yes.
The Acting Speaker (Mr. Kilger): Let me clear the matter up as best I can. The last spokesperson from the Reform Party, the hon.
member for Kindersley-Lloydminster, went well beyond 10 minutes if there was split of the debate time. I am having great difficulty in recognizing someone from the same party at this time.
I hope that the hon. member will understand. I might have been of more assistance if I had asked the member if he was sharing his time. I failed to do so. I regret the confusion.
Mr. Epp: Mr. Speaker, a point of order. I was of the opinion that we were splitting our time, however I will gladly defer if you can assure me that some time down the road I may get another opportunity.
The Acting Speaker (Mr. Kilger): I am sure the hon. member will get another opportunity. The matter of debate today is the amendment of the official opposition. It will be voted on no later than after the bells at 6.15 p.m. I believe there is still some debate time left on the budget motion. Could the table officers indicate to me that there is still some time? There is still some debate time on the budget, and so the hon. member for Elk Island will have an opportunity.
(1800)
Mr. Hermanson: Mr. Speaker, on a point of order, I am sorry if I went over my 10 minutes. I was of the understanding that we had indicated we were dividing our time. Could you indicate whether there is still part of the half-hour slot remaining? Would the member for Elk Island at least be able to use some of that time if there is some time remaining?
I apologize if I went longer. I was expecting a sign from you when nearing the 10 minute mark.
The Acting Speaker (Mr. Kilger): Normally in all likelihood I would have given any member some indication when getting close to his or her time. However, not having the previous information that the member was to be splitting his time, once we got beyond the 10 minutes I accepted the fact that possibly the hon. member for Kindersley-Lloydminster was to take the full 20 minute slot.
Again, I apologize if I contributed to this confusion but I must look to the opposite parties now for debate.
Mr. Hermanson: Mr. Speaker, I apologize for using more time. It is probably my fault and I accept responsibility.
Would the House consider granting unanimous consent in the short time we have before the bells ring to give the hon. member for Elk Island about 10 minutes to give his speech. If the House denies I understand, since it is my fault, but if the House would be generous I ask for unanimous consent.
The Acting Speaker (Mr. Kilger): Could the hon. member for Elk Island possibly summarize in five minutes?
Mr. Epp: Mr. Speaker, I will gladly do that given the opportunity.
[Translation]
The Acting Speaker (Mr. Kilger): So, here we are. We all realize that there was some confusion. The hon. member for Kindersley-Lloydminster thought he would speak for ten minutes and split his time with the hon. member for Elk Island. However, he went on for nearly 15 minutes.
With the consent of the House, I will give five minutes to the member for Elk Island and I will then give the floor to the hon. member for Chicoutimi for his allotted ten minutes. Then the bells will ring for the vote. Is that agreed?
Some hon. members: Agreed.
[English]
Mr. Ken Epp (Elk Island, Ref.): Mr. Speaker, I will focus my comments on the urgency of balancing the budget. This is the thing most Liberals are missing. The talk is always that they are on target. While they are meeting their soft targets, for which they should be commended, at the same time we are losing the battle.
As a high school student I ran a marathon race. Each of us in that high school competition had to set our own goals. Each person practised and did his training in order to achieve his goal. I set the goal to finish the race. That was my only goal. I have never been athletic. I have always been heavy for my size. It is not all muscle.
I set my goal to finish the race, and I did finish it. When I finished the run there was only one person left there, the high school official who checked me off as having met my goal. All the others had already gone home, but I finished.
Notice I do not have any credentials or accolades as an Olympic racer. I met my own goal, which is great, but I did not compete at all outside of that. This is what the Minister of Finance is doing. He is setting goals he can reach, which makes him feel good. There may be one person at the finish line, not many more, who will give him a check mark and say ``you done good''. However, he will not be an Olympic winner at the rate he is going.
The essence of the speed or the importance of the speed is what is happening in the growth of our debt. I did a few little calculations. In 1993 to pay off our debt we would have needed a surplus of some $47 billion a year for 25 years. Regrettably we now need an annual surplus of approximately $56 billion per year. We need a surplus that large if we are to pay off our debt.
(1805)
Every year we postpone balancing the budget and bringing the deficit to zero, that number increases. That, hon. members, is the reason for the urgency. I really feel we are letting down our
children and our grandchildren by allowing the debt to grow indefinitely without solving the problem.
I recognize that my short time has ended. I appreciate the opportunity to speak to the issue.
[Translation]
Mr. Gilbert Fillion (Chicoutimi, BQ): Mr. Speaker, I am pleased to discuss the budget recently tabled by the Minister of Finance.
I feel quite comfortable doing so, because I since had the opportunity to consult my constituents and to hear their comments, which I will convey to this House.
First, taxpayers and residents in my riding of Chicoutimi feel that the Minister of Finance totally missed the boat. They simply ask the government to get its revenues-since the revenue minister is here-where the money really is, starting with family trusts.
They also want the government to review the whole corporate tax system and to abolish tax shelters.
The Minister of Finance is ignoring these calls from ordinary citizens. With the support of all government members, he continues to take what little is left in the pockets of the poor, the unemployed and students.
By contrast, no measure is proposed to recover the $6.6 billion owed to Revenue Canada. Nor is there any plan to review the whole tax system. In this budget, we note that, in terms of income tax, more than $5 billion will be collected from individual taxpayers this year, as compared to a mere $700 million from corporations.
Several of my colleagues have mentioned the fact that, as part of its deficit reduction effort, the government was helping itself to money that workers and employers have contributed to the UI fund, thereby creating an artificial deficit reduction. This astronomical amount could have been put to other uses, such as creating employment.
By his actions, the Minister of Finance is disguising his deficit. He even went so far as to say that he would continue to dip into the UI fund in coming years. It is a disgrace.
Incidentally, business people, workers and unemployed people will be holding a protest march in Saguenay-Lac-Saint-Jean, on May 4, with the support of the Conférence des chambres de commerce du Saguenay, to show the Minister of Finance that they disagree with his action and also to let the Minister of Human Resources Development know that they disagree with his reform. I can assure you that no activist will be taking part in this demonstration.
The fact is that the Minister of Finance is completely blind to the reality, and he is pulling his government along in his wake.
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This budget also contains some measures which endanger another sector of activity that is very important in my area, in Quebec. The announced cuts to the dairy industry place it in jeopardy. Quebec's agrifood industry will be facing cuts of some 32.3 per cent.
For some years now, we in Saguenay-Lac-Saint-Jean have seen the number of dairy farms decrease. Federal government funding, estimated at some $8,000 per farm, allowed milk producers to keep production costs low. You can see right away what will happen. You can guess what the results of this cut will be: increased cost to the consumer. Production will likely be lower because of that.
According to a number of people in the region, quotas could leave the region because dairy farmers will not be able to support their operations on their own. Once again, more unemployment in a region that has long been number one in the country for unemployment, a dubious honour we could readily do without.
Yet, when the Liberal government announced abolition of the Crow benefit, it automatically included a $3 billion compensation for western farmers. Here, the subsidy to the dairy industry is being abolished, but where are such measures this time? Nothing has been planned. A fine country, is it not, with equality for all? The true face of those people across the floor is a two-faced, double standard.
Comparisons are unavoidable. Thus the Liberals have always had two speeches: one for Quebec and one for the rest of Canada. Things are different from one place to the other. Things are watered down. There is, for example, no more mention of distinct society status for Quebec. Now they are talking simply of a cultural homeland in North America, a homeland where the Americans may perhaps have something to say. Why not state right now, clearly, that Quebecers are a people, yes, a people?
Now, I would like to go back to taxation. The minister did promise a review of taxation. But no. What better thing did he come up with? He came up with the clever idea of setting up a committee with people coming from very important companies that have the pleasure of using tax havens. It is ludicrous. However, until this committee makes its report, money is flowing out of the country causing unemployment to rise.
This budget, which we in the Bloc described rightly as a mediocre make-up session, hides the truth about Canadian finances. It makes promises whose fate is the same as those the famous red book made. When will jobs be created? When will the GST be abolished? When will real steps be taken to improve the economy? Nothing. Not even a glimmer of hope.
However, people were hoping for something better. Everything is falling on their heads at the moment. They were especially hoping for jobs. So the famous promise of jobs is a smoke screen. The Minister of Finance has announced he would double summer jobs for students. He is simply putting back what was there before.
Last year, in my riding, half of this funding was cut. This year, it is being doubled, so we are back where we started from. This has happened all over Quebec. Once again, it is window dressing.
We have come to the point where the government has lost all credibility. It is unable to revive the economy, to keep its promises, or to create jobs. Furthermore, the government is about to pass a law that would deprive thousands of unemployed workers of UI benefits. This reform is an admission of failure by the government.
The budget tabled by the Minister of Finance is not a responsible budget. It simply implements what the minister announced earlier and tells us what to expect in the future. For example, if you are 60 years old today, will you remember in five years that you may no longer qualify for the old age pension? Again, this is nothing but a smoke screen. The Minister of Finance must go back to the drawing board so that he can finally meet the people's expectations.
The Acting Speaker (Mr. Kilger): In closing, I would like to thank all hon. members of this House for their co-operation.
It being 6.15 p.m., it is my duty to interrupt the proceedings and put forthwith all questions necessary to dispose of the amendment now before the House.
The question is on the amendment. Is it the pleasure of the House to adopt the amendment?
Some hon. members: Agreed.
Some hon. members: No.
The Deputy Speaker (Mr. Kilger): All those in favour of the amendment will please say yea.
Some hon. members: Yea.
The Acting Speaker (Mr. Kilger): All those opposed will please say nay.
Some hon. members: Nay.
The Acting Speaker (Mr. Kilger): In my opinion the nays have it.
And more than five members having risen:
The Acting Speaker (Mr. Kilger): Call in the members.
(The House divided on the amendment, which was negatived on the following division:)
Debien
Deshaies
Dubé
Duceppe
Epp
Fillion
Forseth
Frazer
Gagnon (Québec)
Gauthier
Gilmour
Godin
Grey (Beaver River)
Grubel
Guimond
Hanger
Harper (Simcoe Centre)
Hart
Hayes
Hermanson
Hill (Prince George-Peace River)
Jacob
Jennings
Johnston
Lalonde
Landry
Langlois
Lavigne (Beauharnois-Salaberry)
Lebel
Leroux (Richmond-Wolfe)
Loubier
Manning
Marchand
Mayfield
McClelland (Edmonton Southwest/Sud-Ouest)
McLaughlin
Mercier
Meredith
Mills (Red Deer)
Morrison
Nunez
Picard (Drummond)
Pomerleau
Ramsay
Ringma
Robinson
Rocheleau
Sauvageau
Schmidt
Silye
Solberg
Solomon
Taylor
Tremblay (Lac-Saint-Jean)
Tremblay (Rimouski-Témiscouata)
Tremblay (Rosemont)
Venne
Williams-72
Pettigrew
Pickard (Essex-Kent)
Pillitteri
Proud
Reed
Regan
Robichaud
Rock
Scott (Fredericton-York-Sunbury)
Serré
Shepherd
Speller
Steckle
Stewart (Brant)
Stewart (Northumberland)
Szabo
Telegdi
Thalheimer
Torsney
Ur
Valeri
Vanclief
Verran
Wappel
Wells
Whelan
Wood
Young
Zed-123
(1840)
The Acting Speaker (Mr. Kilger): I declare the amendment lost.