WHEREAS section 43 of the Constitution Act, 1982 provides that an amendment to the Constitution of Canada may be made by proclamation issued by the Governor General under the Great Seal of Canada where so authorized by resolutions of the Senate and House of Commons and of the legislative assembly of each province to which the amendment applies;
NOW THEREFORE the House of Commons resolves that an amendment to the Constitution of Canada be authorized to be made by proclamation issued by His Excellency the Governor General under the Great Seal of Canada in accordance with the schedule hereto.SCHEDULE
AMENDMENT TO THE CONSTITUTION OF CANADA
1. Term 17 of the Terms of Union of Newfoundland with Canada set out in the Schedule to the Newfoundland Act is repealed and the following substituted therefor:
``17. In lieu of section ninety-three of the Constitution Act 1867, the following shall apply in respect of the Province of Newfoundland:
In and for the Province of Newfoundland, the Legislature shall have exclusive authority to make laws in relation to education but
(a) except as provided in paragraphs (b) and (c), schools established, maintained and operated with public funds shall be denominational schools, and any class of persons having rights under this Term as it read on January 1, 1995 shall continue to have the right to provide for religious education, activities and observances for the children of that class in those schools, and the group of classes that formed one integrated school system by agreement in 1969 may exercise the same rights under this Term as a single class of persons;
(b) subject to provincial legislation that is uniformly applicable to all schools specifying conditions for the establishment or continued operation of schools,(i) any class of persons referred to in paragraph (a) shall have the right to have a publicly funded denominational school established, maintained and operated especially for that class, and
(ii) the Legislature may approve the establishment, maintenance and operation of a publicly funded school, whether denominational or non-denominational;
(c) where a school is established, maintained and operated pursuant to subparagraph (b) (i), the class of persons referred to in that subparagraph shall continue to have the right to provide for religious education, activities and observances and to direct the teaching of aspects of curriculum affecting religious beliefs, student admission policy and the assignment and dismissal of teachers in that school;
(d) all schools referred to in paragraphs (a) and (b) shall receive their share of public funds in accordance with scales determined on a non-discriminatory basis from time to time by the Legislature; and
(e) if the classes of persons having rights under this Term so desire, they shall have the right to elect in total not less than two thirds of the members of a school board, and any class so desiring shall have the right to elect the portion of that total that is proportionate to the population of that class in the area under the board's jurisdiction.''
Citation
2. This Amendment may be cited as the Constitution Amendment, year of proclamation (Newfoundland Act).and of the amendment.
Mrs. Francine Lalonde (Mercier, BQ): Mr. Speaker, I am pleased to speak to this complex and difficult issue.
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It is an issue that is complex and difficult for Newfoundlanders and for Canadians, but less so for Quebecers. That having been said, I can understand that members across the way, who are particularly concerned by the effect that a vote in the House of Commons could have on the recognition of the rights of minorities, of native peoples, in the Constitution, may be thrown into disarray by the House's approval of the amendment proposed by the Province of Newfoundland.
This needs to be acknowledged, and the Senate has given us an opportunity to take another look at this issue. I would note in passing that it is unacceptable for an unelected Chamber to be permitted to do what it has done, and the Bloc has made this point on a number of occasions.
But, back to the main item. The opportunity we have been given to take another look at this issue allows us to bring out a number of facts: the fact that the Newfoundland referendum was not won by a large majority, quite the contrary, allowing us to say that the groups affected-and I am not calling them minorities-in this case, the various denominations, gave their approval. It is clearly a decision by Newfoundlanders regarding the organization of their schools, irrespective of the original provisions of the Constitution.
Some people may have language concerns, but we know that for most the primary issue is denomination. You know that this is an extremely sensitive issue in Quebec, and that the Constitution of 1867 provided guarantees, which at the time were supposed to be guarantees for anglophones in Quebec and francophones in Ontario, and later in other provinces. But back then, as denomination and language were largely, not exclusively, but largely linked, the guarantees given denominations were largely language guarantees.
Today, urged on by a large percentage of the public, by extremely urgent constraints, the Government of Quebec wants to reorga-
nize the entire school system on the basis of language, rather than denomination. But it is prevented from doing so by section 93.
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Obviously, Quebecers who would like to change their school system and thus change the guarantees given in the Constitution to religious denominations are extremely interested in this vote, this referendum that was held in Newfoundland and in the amendment requested by the Government of Newfoundland.
It is important to realize that the rights affected here are not those of an internationally recognized minority. These are guarantees given to religious denominations for which the province is, in the end, responsible.
When this measure became before the House, the Bloc Quebecois voted in favour of the motion because it recognizes the right of the people of Newfoundland to organize their schools as they see fit, and also the fact that the people of Newfoundland would give religious denominations the guarantees they felt were required by law.
In Quebec-and I say this quite frankly-using section 93 is more complicated because to do so we would have to accept the Constitution of 1982 which was imposed on us, and when I say us, I mean the people of Quebec and the National Assembly. This Constitution of 1982 is considered internationally as a denial of the fundamental right of the people of Quebec.
Although the Constitution of 1982 that was imposed on us by force does not apply with any legitimacy, we nevertheless refer to the possibility of using section 93 as a way to deal with this urgent matter of reorganizing our school system.
I would like to explain how urgent the problem is. You probably know that about 90 per cent of immigrants who settle in Montreal and become Canadian citizens in Quebec still remain largely in Montreal and the surrounding area. This means that the proportion of francophones has gone down steadily and that, since the guarantees provided under the Constitution prohibited us from organizing school boards along language lines, we have this absurd situation where the children of immigrants are required under Bill 101-which became Bill 86-to study in French. That is the only thing left of the bill.
However, many children do so in Protestant and therefore anglophone school boards, although they have French classes. However, in these French classes-and I have heard many comments from teachers and parents who send their children there-it is clear they are not part of a francophone whole but of an English-language organization that provides classroom teaching in French.
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It is public knowledge that when these young people graduate from high school and are no longer under the obligation to study in
French, most of them end up in one of the anglophone CEGEPs. So this is a problem for all of Quebec, but it is mainly concentrated in the Montreal region.
The Montreal region has to live with the problem of the permanency of these guarantees which actually no longer guarantee anything at all as far as the Protestant religion is concerned. Since there are so many denominations, there is a tendency to teach religion outside of school, while the schools will teach ethics, but they will still have a so-called religious, anglophone organization.
On the French side, there are parents in Montreal who want their children to go to Catholic schools, although as we saw recently in a survey, the majority is not in favour, so certain distinctions must be made.
The important question is to find out whether the Montreal component of Quebec society will be able to integrate the children of immigrants and of new citizens of Quebec, which is vital to maintaining, if not improving, the position of the French language in Quebec.
Accordingly, and I would like to come back to the nuances I mentioned, parents clearly want their children to continue to be educated in religious history and in religion in school. They do not want their children to remain ignorant about the existence of religion, authority, the Bible and the Gospel. On the other hand, they are very aware that, if schools are to teach religion, there will have to be schools for all the denominations that make up the religious mosaic of Montreal.
This issue is therefore both complex and delicate. For Quebecers, and especially those in Montreal, it means that, if the Constitution as it stands is not changed, it will be impossible, for all intents and purposes, to reorganize the schools so as to promote integration.
There was an attempt by the previous government to have the Supreme Court interpret a bill that did not pass, through a change to section 93. The result was ludicrous, because it split up school systems by maintaining the religious elements and tacking on French or English elements to them. The resulting fragmentation would be extremely expensive, but would not serve the fundamental needs I mentioned earlier.
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As a Quebecer, I can easily understand what the people of Newfoundland want, especially since they worked so hard for something that was imposed on Quebec, namely the patriation of the Constitution.
For the rest of Canada, for francophones outside Quebec, whose assimilation, which is on the rise and alarmingly so in some cases, seems a tragedy, the fact that the House of Commons can, by a majority vote, change what was guaranteed by the Constitution--
not to the minority but to certain groups-seems to pose a serious danger.
Would this House vote for the elimination of the constitutional provisions that protect francophones in one western province or another?
I know that, whether they speak French or English, my colleagues opposite who are concerned about this strongly oppose this measure and I can understand why.
The result of this alarming assimilation rate in some parts of the country is that the rights of the francophone minority in Canada are being and will continue to be trampled. In this respect, the vote on this motion has set a precedent, not because it concerns religious guarantees but because it concerns guarantees entrenched in the Constitution. I can understand my hon. colleagues when they say that a line may have been crossed.
We fought with all our energy for francophones outside Quebec. Our history-and there is no doubt about this in my mind-is the reason why the Official Languages Act exists. As a historian by training, I have no hesitation in saying that the Official Languages Act would never have seen the light of day, had it not been for the tumultuous language debates that took place in Quebec during the sixties.
Had these debates not taken place, Prime Minister Trudeau would never have had any reason to impose on the whole country an act which a large number of Canadians did not want. This act was passed because people believed it would settle the Quebec issue. They were bitterly disappointed when they realized that this was not what Quebec wanted. What Quebec wants is to eventually have all the powers. It does not want an official languages act imposed from coast to coast.
So this is an important vote. It was an important vote the first time and it is an important vote today.
I believe that the existence in a mostly French speaking, sovereign Quebec of an English speaking minority would also help protect the French speaking minority in Canada.
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Again, for the time being, I understand the hesitations of the members opposite. I understand them because, in spite of the very disappointing and shallow comments made by the heritage minister, life for francophones outside Quebec is not easy. These people have to perform daily heroics, as I have frequently seen during trips to the western provinces, Ontario and, occasionally, Acadia.
Daily heroism is not conducive, among other things, to maintaining the enthusiasm of young people. We know that assimilation is rampant and almost a normal phenomenon when these young people marry English speaking persons. It must be noted that the assimilation rate in Ontario is 38 per cent, and rises to 76 per cent the further west you go. The situation is getting worse, not better, and is a cause for serious concern.
It will not be by refusing to pass the amendment sought by Newfoundland, which is facing an educational and denominational organization that is very difficult and complex for a small province, or by preventing Newfoundland from resolving this problem that the growing assimilation in western Canada will be halted. I think this issue will be, not resolved, for it is too late for that, but at least affected by energetic measures that we have yet to see, which will focus attention on the problem and slow down the rate of assimilation.
One thing I would like to point out, and this still falls within the area we are talking about, is how many functionally or totally illiterate francophones there are outside Quebec, and how rare and inaccessible the measures are to help them learn to read in their own language. My point is that, in order to protect the future, we need to take active, energetic steps, rather than stand in Newfoundland's way.
Mr. François Langlois (Bellechasse, BQ): Mr. Speaker, the debate triggered by Resolution No. 12 in this House on term 17 of the Terms of Union of Newfoundland with Canada has, as the hon. member for Mercier said in her speech, brought to light all the misgivings we may have concerning constitutional change, particularly when it appears that a category of persons protected under the Constitution will find its rights diminished, if not done away with altogether, without its consent.
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The question before us is not a partisan one, but a matter of analyzing the protection of categories of persons.
I do not wish to interfere in the matter of the administration of Newfoundland's schools, but I can still analyze the situation. Obviously, their school system is a complicated one. To all intents and purposes, term 17 gives the legislator of the province of Newfoundland, what is, after all, a limited power over education in that it cannot legislate unless the various religious denominations are respected. Strange situations occur, like having six different school buses picking up children of six different religious denominations in one small locality, because these denominations must be given equal treatment. Perhaps, in 1996, this needs reviewing.
A position definitely needs to be taken, when all is said and done. The more the debate progressed-and I have listened attentively, either in my office or in this House, to my hon. colleagues who have spoken on this-the more it struck me that it was not all that obvious that, in the September 5, 1995 referendum, each and every religious denomination constitutionally protected by term 17
of the Terms of Union of Newfoundland with Canada had given consent.
I cannot state the contrary, either, that every religious denomination refused to consent. In some parts of Newfoundland, people voted massively against the Newfoundland government's proposal, while in others they voted massively in favour. The vote was very divided, and the final vote was also very divided. So much so that basically, it is up to those who are primarily concerned to pass a final judgement on this issue. The Newfoundland government, rightly or wrongly, thought that on the basis of a referendum held on September 5, 1995, it had a mandate to pass a constitutional resolution to amend term 17 and ask the governor in council to refer the same question to this House, which is what happened.
History will have to realize we did not initiate these proceedings, that the Newfoundland legislature acted first, and that the Government of Newfoundland drew its conclusions from the outcome of the referendum. I respect its decision although I have quite a few questions.
It will be up to the voters of Newfoundland, if the government or the legislature did not act wisely, to pass judgment on their elected representatives who adopted the constitutional resolution before the House today.
The situation that will be created by the vote in this House is not irreversible, in that a new legislature in Newfoundland, with different concerns, may request a constitutional amendment to revert to the previous legal position.
In that respect, we are not doing anything irreparable. It would not be like amending the Canadian Constitution to say that from now, bills and court rulings will be in English only. That would be irreversible. So there is still a certain amount of flexibility here.
In the end, although we are extremely reticent, because this is a mine field and we might be accused of having created a precedent today, in the end perhaps we can, by stretching our tolerance to the limit, accept the resolution before the House.
However, this precedent should not be used to attack the rights of Franco-Ontarians or the rights of francophones in Manitoba or anywhere else, but especially in those two provinces where they enjoy constitutional protection, as in the province of New Brunswick, which subsequently protected its francophone minorities.
The question is of course a sensitive one where Quebec is concerned, as the hon. member for Mercier said earlier.
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We know that in Quebec we have provisions governing schools and minority rights, which are now out of date. The only way to get around this would be perhaps to have section 93 of the Constitution amended, while ensuring that those protected under this section are in agreement. There are ways to do so and these ways have already been used in other circumstances.
I also understand the reticence of the Government of Quebec to apply under the amending formula of 1982, which it and all political parties in Quebec never recognized. I can understand its reticence in not joyously rushing, with honour and enthusiasm, to pass a resolution to call on this House to pass one as well to amend section 93, which would make things so much simpler in Quebec, as the hon. member for Mercier pointed out earlier, by enabling us to update our system of education.
However, the Government of Quebec has not acted in order to show how touchy constitutional change is with respect to minorities, because a fairly strong consensus is emerging in Quebec. There is of course the 1982 padlock, which is more of a yoke than a padlock, obliging us to live with this situation.
Those like me who were raised in a rural municipality of Quebec, where, two or three times a year, a collection was taken up in school for the survival of French-the hon. member for Mercier must remember that-get a little nervous when there is talk of taking rights away from classes of persons protected by the Constitution.
That is why, as this debate draws to a close, I am telling you that, because of this uncertainty and in spite of all the misgivings I have, in the end, I could probably vote in favour of the proposal before us, while at the same time expressing the wish that the provisions contained in the Constitution that protect minority rights not be changed without first obtaining the consent of the minorities concerned.
Mrs. Lalonde: Mr. Speaker, I simply want to say that the hon. member's speech reflects how sensitive this issue, which appeals to people's principles, really is.
The whole debate, at least on our side, has led us to the conclusion that, in spite of some reservations, there are enough guarantees for the French speaking minority which, again, is not the one affected, and we can understand and accept why Government of Newfoundland made this request, to which the federal government has acceded.
The Deputy Speaker: Is the House ready for the question?
Some hon. members: Question.
The Deputy Speaker: 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: All those in favour will please say yea.
Some hon. members: Yea.
The Deputy Speaker: All those opposed will please say nay.
Some hon. members: Nay.
The Deputy Speaker: In my opinion the nays have it.
And more that five members having risen:
The Deputy Speaker: Call in the members.
(The House divided on the amendment, which was negatived on the following division:)
Jacob
Johnston
Keyes
Kilger (Stormont-Dundas)
Knutson
Kraft Sloan
Lalonde
Landry
Lastewka
Laurin
Lavigne (Beauharnois-Salaberry)
Lebel
LeBlanc (Cape/Cap-Breton Highlands-Canso)
Leblanc (Longueuil)
Lefebvre
Leroux (Richmond-Wolfe)
Leroux (Shefford)
Loubier
MacAulay
MacDonald
MacLellan (Cape/Cap-Breton-The Sydneys)
Malhi
Maloney
Manley
Marchand
Marchi
Martin (Esquimalt-Juan de Fuca)
Martin (LaSalle-Émard)
Mayfield
McGuire
McKinnon
McLellan (Edmonton Northwest/Nord-Ouest)
McWhinney
Ménard
Mercier
Meredith
Mifflin
Mitchell
Morrison
Murphy
Murray
Nault
Nunez
O'Reilly
Pagtakhan
Paradis
Paré
Patry
Payne
Peters
Peterson
Pettigrew
Picard (Drummond)
Pickard (Essex-Kent)
Proud
Ramsay
Reed
Regan
Richardson
Rideout
Ringma
Ringuette-Maltais
Robichaud
Robillard
Rocheleau
Sauvageau
Schmidt
Scott (Fredericton-York-Sunbury)
Scott (Skeena)
Shepherd
Sheridan
Silye
Simmons
Skoke
Solberg
Speaker
Speller
St. Denis
Stewart (Northumberland)
Stinson
Strahl
Szabo
Taylor
Terrana
Thalheimer
Thompson
Torsney
Tremblay (Lac-Saint-Jean)
Tremblay (Rosemont)
Ur
Vanclief
Venne
Walker
Wells
Whelan
White (Fraser Valley West/Ouest)
Williams
Wood
Young
Zed-186
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The Acting Speaker (Mr. Milliken): I declare the amendment lost.
[English]
The next question is on the main motion.
(The House divided on the motion, which was agreed to on division:)
Stewart (Northumberland)
Strahl
Taylor
Terrana
Thalheimer
Thompson
Torsney
Tremblay (Lac-Saint-Jean)
Tremblay (Rosemont)
Vanclief
Venne
Walker
Wells
Whelan
White (Fraser Valley West/Ouest)
Williams
Young
Zed-172
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[Translation]
The Acting Speaker (Mr. Milliken): I declare the motion carried.
(Motion agreed to.)
[English]
It is my duty, pursuant to Standing Order 38, to inform the House that the question to be raised tonight at the time of adjournment is as follows: the hon. member for Elgin-Norfolk-Endangered species.
read the second time and referred to a committee; and of the amendment.
The Acting Speaker (Mr. Milliken): When debate was interrupted, the hon. member for Wild Rose had the floor. I should advise the hon. member that he has nine minutes remaining in his time.
Mr. Myron Thompson (Wild Rose, Ref.): Mr. Speaker, when I was speaking yesterday evening I was talking about the loss of jobs that the harmonization plan is going to create.
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If the finance minister needs evidence that this policy will kill jobs, all he has to do is read the study from Ontario. It stated: ``Harmonization would remove $3 billion from the Ontario economy, and kill jobs and economic growth''. That is why Ontario did not agree to harmonization. It knew this policy will kill jobs, jobs, jobs and not create them.
In order to kill jobs, jobs, jobs in the Atlantic region, the Liberals will kill jobs, jobs, jobs in Ontario, Alberta and B.C. The Liberals will remove over $300 million each from the Ontario, Alberta and B.C. economies to bribe the Atlantic premiers into signing on to harmonization.
Have the Liberals no understanding of economics? Do the Liberals not know that if Canadians feel insecure in their jobs they will not spend and purchase more than absolutely necessary? This failure to create retail sales will kill jobs, reduce federal income and force higher expenditures from federal tax dollars to finance unemployment insurance and social services. All this adds up to a bad deal.
The Liberals will cost taxpayers more, create fewer jobs, stifle government revenues just so they can claim to have fulfilled a broken promise from their Liberal dead book.
Since the Liberal policy will lower sales, end jobs and give companies leaner profits, the self-fulfilling prophecy of less retail sales will be reinforced.
Again the Liberal understanding of economics is suspect. An increase in subsidy money acts as an increase in regional money supply, increasing inflation. The bribe money of a $1 billion is a regional subsidy that will further harm regional job creation through inflation. The Liberals have stated many times that inflation is a job killer, yet they will increase regional inflation, killing more jobs, just to keep this Liberal dead book promise.
The Halifax Chamber of Commerce said that harmonization will increase new house prices by 5.5 per cent. Consequently that is going to lead, according to many experts, to much higher property tax within the area, this in an area that has difficult economic problems because of past government policies.
The Liberals will do anything, regardless of the effect on Canadians, to try to prove that they have integrity, even though all Canadians know, thanks to the Liberal dead book, their integrity is very, very low.
The finance minister will argue his harmonization policy to falsely fulfil a Liberal promise will not kill jobs. I would like to ask the finance minister if this is so, why is Greenberg stores closing five stores even before harmonization takes place? Greenberg has run a cost benefit analysis. It knows this policy will reduce profits and have acted accordingly. What cost benefit analysis has the finance minister conducted and will he release this information to Canadians? I think not because it is obvious he had done none.
When the harmonization policy takes effect it will increase the cost of doing business to Atlantic province retailers. This much is already confirmed and known by the studies done in the provinces agreeing to harmonization.
This will simply drive consumers near New England states to cross the line, purchase their goods where taxes are lower and add further problems to our current balance of payments. If the Liberals would only wake up and listen to Reform policies and try to implement something that would be far reaching from sea to sea, involving each and every province, then Reform would gladly have a look at their proposal. But they do things in a piecemeal fashion and cause all sorts of problems, pitting one province against another. It causes nothing but grief. It is no wonder that we are having difficulty in this land, trying to bring unity and understanding.
Mr. Alex Shepherd (Durham, Lib.): Mr. Speaker, as I listened to the hon. member's comments I wonder if he is aware that when we harmonize two taxes that what happens is there are adjustments. That means some commodities go up and other commodities go down.
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The Reform member talked about those things which are going up. He did not talk about the reality that in all of those provinces at different rates, 5 per cent in Newfoundland, 4 per cent in Nova Scotia and 4 per cent in New Brunswick, the total quantum of taxes being collected by government has been reduced. The reality is that money is being added to the pockets of consumers. The bottom line is there will be more disposable income for consumers which will create jobs. The whole philosophy that the member used, that it will kill jobs, is erroneous.
The member talked about the Greenberg company. Its representatives have indicated that many of the Greenberg stores in the maritimes were marginal. They were losing money. They are talking about closing some of them. However, the bottom line is they were going to go out of business anyway. It has nothing to do
with the implementation of tax, but hon. members opposite want to use that as some kind of analysis.
The member did not talk about the positive things. One of the positive things is one collection authority. Right now each individual province has an administration to collect the retail sales tax and the federal government has an administration to collect tax. Why can the Reform Party not see that it makes sense to have only one administration collecting those taxes? Why can Reform members not see the great economic benefit that will be extended to the maritime provinces because they will not have to incur those costs?
Yesterday I talked to a fellow accountant in St. Anthony, Newfoundland. He said it was one of the best things he has ever seen happen in the province. The province of Newfoundland will save millions and millions of dollars. That money will go back into an economy which as we know is very weak. That is a positive benefit of this legislation.
Right now, small and medium size businesses, the job creators in this country, have to fill out forms for the retail sales tax and forms for the GST. There is not one of those small businesses that would not say that just having one form will be a tremendous improvement. Why is it that the Reform Party cannot see that?
Then there is the business about pitting one province against another. We have three provinces now, which is three more than we had a year ago. A couple of years from now we will have twice as many as that again, including my province.
Mr. Thompson: Mr. Speaker, it is difficult to answer a question that was a speech but I will try.
It is ridiculous for any member of this House to say: ``What are you talking about? This is something which Canadians want. After all, we got three provinces this year and two or three years down the road we will get a couple more and another five years down the road we might get one more''. What kind of a planning strategy is that?
What about offering a package to all the provinces and give them a chance to study the issue and respond? No, not from the dictators that we have in this place. It is better just to throw it out there and say: ``This is a good deal. If you do not believe it, just ask us and we will tell you''.
The Ontario studies have said it would cost that province $3 billion. Ontario is not interested. I am surprised the member who is from Ontario would not take that into account. He should talk to a number of people in his own riding. Obviously a number of people in Ontario are extremely opposed to this.
And the Liberals say that things are going to be cheaper overall. Add up the things which a family with an average income has to buy, like children's clothing, heating oil and other necessities. All of a sudden they will have to pay more for those items. Those families do not buy luxuries by any means; they try to make ends meet. I am talking about the bulk of the people, the people who pack their lunch, put their head down and go to work every day. They have a terrible time trying to make ends meet because of the taxes they have to pay. If the member does not believe that, he should ask anybody who is out there working how well they are making out.
To me this whole thing is a sham. It is a cover-up for a dead book error. The Liberals were going to scrap and kill the GST. They made big, brave statements in the campaign, but when push came to shove they did what we see today. It means nothing. If the Liberals want to make a proposal to the country as a whole, if they want to take Canada into consideration for the good of all Canadians, then they should show us something that does that and they should stop piecemealing around.
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Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker, I understand there is only a little time so I will ask the member a very direct question. The member and his party have stated that they are opposed to the harmonization of the taxes. They keep pushing about killing, abolishing and scrapping. Is the Reform Party proposing that the current GST simply be eliminated totally?
Mr. Thompson: Mr. Speaker, it is pretty obvious what we have said from the very beginning. Let us have a responsible government, let us balance the books, let us stop spending more than what we have. Get the balancing effect into place, then start giving some people a break in taxes and maybe the GST would be an excellent place to start.
The Liberals are bringing in a harmonization plan that only affects a small number of Canadians in three provinces. It does not address the real issue all across the land. Other provinces are saying no to the plan and some are saying that they do not think so. What kind of decision making is that? Let us get this act together.
It is time the Liberal government started consulting Canada instead of its caucus.
Mr. Harold Culbert (Carleton-Charlotte, Lib.): Mr. Speaker, I listened intently to the hon. member's presentation and to the subsequent questions and comments which came forward. I wonder if the hon. member is aware of three relevant points to this debate.
One point relates to small business. I have talked to a number of small business people in Atlantic Canada. They have said that with the harmonization they will have one set of records to keep, one cheque to issue, one auditor to review their books and accounts. This will replace the current two sets of books, one for provincial sales tax and one for GST, two cheques to issue, and two auditors coming in from time to time to review their accounting systems.
They have said this is a tremendous cost saving to them in the operation of their businesses.
Second, in my home province the current provincial sales tax is 11 per cent and the GST is 7 per cent. Is the hon. member aware that currently there is 7 per cent and 11 per cent on top of that 7 per cent on purchases of such items as automobiles, refrigerators, stoves, paper towels, Kleenex, bathroom tissue, paper supplies, all the normal things that we use day in and day out? To harmonize that into one system with a single 15 per cent tax is a savings. There is no question about it.
According to the GST listing there are other products that will go on. For some of those a credit system will come forward but overall there will be a tremendous savings for the consumer and the business person. This proposal is supported by the majority of people in Atlantic Canada.
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Mr. Thompson: Madam Speaker, it is questionable how much support there is when I see petitions bearing 16,000 signatures of people who live in these provinces and object to the harmonization plan. I find it unusually strange that there has been some careful analysis done by some companies which were going to open new stores in 1997 but decided not to because of what was happening, that it was not good for business.
There has been a very careful analysis regarding retail sales. Many retailers have come to the conclusion that retail sales would be way down. We all know that whenever retail sales are lost there is a good chance of job losses and the overall effect is not good.
I think a very careful analysis has been done by both sides, not just on the cost savings because of the harmonization but also the increase in other problems that may arise. It has all been carefully done by those who have the expertise to do so.
I would ask the hon. member to remember that statements are coming from people who have a great concern about this, people such as those at the Retail Council of Canada.
The Acting Speaker (Mrs. Ringuette-Maltais): I am sorry, but the hon. member's time has expired.
Mr. Thompson: I thought if I was asked a question, I would have time to give the answer.
The Acting Speaker (Mrs. Ringuette-Maltais): The hon. Parliamentary Secretary to the Minister of National Revenue on debate.
Mrs. Sue Barnes (Parliamentary Secretary to Minister of National Revenue, Lib.): Madam Speaker, I am going to speak about improvements to Canada's federal goods and services tax. There are over 130 improvements and the government is introducing them to simplify the GST and to increase its fairness. These changes do go a considerable way toward replacing the GST as we know it with a better system.
The GST as we know has been a source of much controversy. There is nothing as topical as something everyone dislikes and no one likes taxes. That is not surprising.
It was not long ago in this country that nobody paid taxes because there were none. At the turn of this century there were no national income, corporate or sales taxes for anyone to pay, rich or poor. Believe it or not, in 1900 Ottawa got most of its revenues from customs duties. I suspect that this could be the reason our political ancestors promoted Canada as a great trading nation.
But we live in a different time and in many ways a much different country, a country cited as one of the finest in the world in which to live. One of the distinguishing features that makes this country of ours the envy of others is the priority we place on quality of life. We are known the world over for social programs we have devised to ensure a decent quality of life for everyone.
Taxes unfortunately are the duties and dues that we pay for the privilege of membership in this country and this society. The taxes we pay ensure a common richness. And let us face it, the GST is a tax that brings in $18 billion a year, or 13 per cent of the total federal revenues. Without a tax like it, our social programs would be in jeopardy, our debt problems would be deadly, and our national advantage as an international economy would be at risk.
Having said all this, I want to say also that the government has been correct to criticize the GST as it was. In so doing, we were responding to what Canadians told us. Canadians told us that the GST was poorly conceived. They told us it was an outrageous example of overlap and duplication that came out of bureaucracies. They told us that the GST was cumbersome and that in particular it cost small business too much time, too much energy and too much money.
The legislation being introduced now both simplifies and clarifies the application of the GST and also streamlines the administration. In doing this it introduces a greater fairness in the system and lays the foundation for a national harmonized sales tax. Taken together, the measures that we see in the bill represent a major step toward replacing the GST as we have known it. They respond to what Canadians have been telling us.
In looking at alternatives to the GST, the all-party finance committee of the House went to Canadians for advice. It listened to nearly 500 witnesses and read more than 700 briefs from consumers, professionals, businesses and individuals. What did the Canadian people tell us?
Canadians told us to do what is sensible. They told us to fix the problems that were there. They told us not to run off and create some other new or strange scheme to adjust to, to do the same job as the GST and risk the same complexities. They said: ``We need the $18 billion, we understand that. The thing is in place now so fix the problems and get rid of the irritants. Fix the duplication and create sales tax harmonization. Fix the headaches that we have by
clarifying the rules and making it simpler and fairer''. This is precisely what this legislation starts doing. In so doing, it shows what can be accomplished by simply responding to what Canadians have told us to do.
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Our other colleagues in the House will speak to the issue of sales tax harmonization which is in the legislation respecting three of the maritime provinces. Today I do want to comment more on the measures that address the headaches that affect all Canadians in this legislation and which are also being dealt with at the same time.
In developing the changes, many of which are technical and sector specific, this government went straight to many of the groups, organizations, sector leaders and professional associations affected by the tax. We told them we had the tax and asked them what we could do with it to make their life somewhat easier. We wanted to know what we could do to fix their problems with this legislation.
What we heard in response resulted in this legislation with about 130 different changes affecting multiple sectors of our society. The package introduces measures to simplify the operation of the tax for many businesses and non-profit organizations. It introduces measures that make compliance easier and clarify confusing aspects of the tax. It also introduces measures to improve the fairness of the tax both for the consumers and for businesses.
I wish to elaborate on a few points. First, well over one-third of these proposed modifications are aimed specifically at simplification. These include streamlining the tax treatment of charities and non-profit organizations. They include a simplified calculation of employee and shareholder benefits for Canadian businesses. Businesses can now make a one step tax calculation using the same information they use for their income tax purposes. The modifications include measures which simplify transactions related to used or second hand goods, which have become a significant part of the economic activity in this country.
The package also includes proposals to clarify the application of the tax and, in particular, to ease the burden of compliance for small businesses. These changes were done to ensure that there is more precision in the application of the GST and that it does not complicate administration unnecessarily.
They clarify certain educational services such as those provided and what we are now defining as public colleges and vocational schools as well as universities. They involve streamlining the administration of tourist rebates, something that is very important in this country as an industry, and extend the eligibility to these rebates to non-resident businesses.
There is also the much needed clarification of the GST in areas relating to financial services, to trusts and estates and changes to existing partnership rules.
Finally, this package of measures restructures the GST to make it fairer for all Canadians. This is accomplished by ensuring competitive equity among businesses and applying the tax equally to all consumers. A variety of modifications restores the international competitiveness of Canadian service providers, equalizes the tax treatment of health care services and introduces a fairer application of the GST to housing rebates.
The themes are simplification, clarification and greater fairness. These have all been the guiding principles in developing these changes. Many of these measures being proposed are technical and strategically aimed to deal with specific problems in certain sectors.
In the amount of time I have here today it would be impossible for me to review each adequately or in sufficient detail. I know all the members have access to that material. Consequently, I would like to draw the attention of the House to some general examples of the improvements which are in this legislation.
I should first remind the House and its various members of the invaluable contribution being made to the well-being of our Canadian society by Canadians and Canada's charitable organizations. However, when the GST was established the rules were developed to address the activities of the largest charities. Many smaller charities have found these rules to be too onerous for their use. Yet combined together these small charities, precisely the smaller charities, do much of the charitable work in the country.
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This legislation proposes new and simpler rules for all charities but, in addition, new rules were specifically designed for smaller charities which will simplify compliance for the GST for the smaller charitable group. As a result of these changes significantly fewer charities, about 10,000 fewer to be exact, will have to register for the GST at all. For those that do remain registered, 10 to 12 per cent of all charities, the rules will be simpler, particularly for fundraising activities, for filing returns and for claiming rebates. I think that is very important and very positive. This will help our charity sector increase the range of its activities in a time that fiscal restraint is forcing many to become more dependent on the network of goodwill that exists among our volunteers and our community based organizations.
Further, a number of changes are proposed to make the federal sales tax system fairer in its application in the health care sector. We all know especially with our aging population how important
the health care sector is to Canadian society and how much more important it will be in the future.
There will be changes to the treatment of services provided by health care practitioners who are not medical doctors or dentists. A greater degree of fairness is being introduced to exempt from GST the services these practitioners provide. For example, the list of exempt health care practitioners will be extended to include dietitians who meet the criteria for health care professionals in five provinces. As a result, using that example, dietitians will be able to provide their services exempt from federal sales tax to individuals, health care facilities and public sector bodies starting January 1, 1997.
An added advantage of this measure is that it increases professional regulation of health care practitioners who are requesting an exemption. This makes their services more financially accessible to the public.
A number of changes are also proposed to extend or clarify the zero rating provisions as they apply to certain medical devices and associated services. For example, the zero rating of hospital beds will be extended to purchases by all health care facilities, including long term health care facilities. Currently the sale of hospital beds is zero rated only when purchased by a hospital or by an individual with a written order from a medical practitioner. I think we can see that there are positive elements in the legislation.
The zero rating of the cost of modifying a car, for instance, to meet the needs of an individual using a wheel chair will also be expanded. Orthopaedic devices will be zero rated when they are made to order for an individual or when they are supplied under prescription.
These are sensible changes which are being introduced at an appropriate time, as I said before, when the needs of an aging population are increasing. I do not think there would be any argument in this House that these are beneficial to certain segments of Canadian society.
I go to another sector, the municipal sector. We used to have various complications concerning the GST, for instance, garbage collection. These will be alleviated under this new legislation. The collection of garbage will now be exempt from GST when it is provided by a municipality or by a government.
Similarly, services to remove snow, ice and water, maintain water distribution, sewage or drainage systems or repair and maintain roads and streets and sidewalks, these all will now be exempt from GST when they are supplied by the municipality. This government proposes also that the collection of recyclable materials be included in the exempt provision for the collection of garbage. That is important when we are trying to help our environment in this country. These efforts, simplification and clarification in the application of GST, will have a beneficial effect for the environment and for different levels of government, namely the municipal level.
There is another sector this provision has a beneficial effect on, the agricultural sector. Here again the list of zero rated supplies is being expanded to include automated and computerized feeding systems, specified mulchers, crop shredders, transportable conveyers and elevators, and certain wagons and trailers.
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It is always important when we develop legislation that we treat all the sectors across this country, whether it is industrial, agriculture, municipal levels of governments or health care sectors, that there is something that is going to help a number of the organizations in this land.
There are changes to the existing rules for the benefit of builders of subsidized residential complexes to ensure that they also have equitable treatment for themselves as builders, together with non-subsidized housing.
There is a broader range of goods and services relating to international transportation which can and will also be zero rated, as will services provided by purchasing representatives to non-resident businesses.
These things are technical. I do not think they are the most exciting but I know to the people who are concerned with this legislation they are important changes. They will have a benefit in areas where people were complaining to us before. I know the members of the finance committee heard these complaints, and this legislation is the response.
There are many other proposed changes to the tax treatment of international transactions that will improve the administrative efficiency and the competitive advantages of Canadian businesses. I could go on with more examples but these changes address the inequities, the complexities and the unnecessary obstructions that have made the GST so unpalatable to Canadian citizens, Canadian businesses and different levels of governments.
They bring needed simplicity, clarity and fairness where issues sometimes were cloudy. In making these changes, this government has responded in large measure to not what a government wanted, or the government side of this House wanted, but what Canadians told us were problems.
In addressing these technical amendments to the GST, we are not talking only about the harmonized provinces. We are talking about across Canada. It is a response to the irritants in a system of a badly designed tax and we are trying to improve it. This is not a perfect world. There is no legislation that is perfection that I have ever seen in this House any former House or probably any future House. But we are moving forward with improvements.
That is what legislation does. That is our job as responsible people trying to administer fair taxes, simpler taxes and equitable taxes in a country.
An hon. member: Oh, oh.
Mrs. Barnes: It is incredible to listen to people heckling while one is trying to complete a speech but that is part of standing up and debating in this House.
We have to understand that this bill accomplishes a major step in replacing the GST as it was. In my opinion it is moving toward a better system. I would like this country at some point in time to be a fully harmonized system but life is not perfect, we as members of this House are certainly far from perfect, and other legislatures are far from perfect also.
What we do is make improvement and gradually things move in the right direction and maybe one day we will have the perfect solution for people who think there are perfect solutions. Right now we are working toward improvements.
The Acting Speaker (Mrs. Ringuette-Maltais): I will allow a very short question and a very short answer. There is one minute left in this debate.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe-Bagot, BQ): Madam Speaker, I have a very brief question, and I hope the answer will be equally brief.
I listened to my colleague, the member for London West, speak of her pride in being associated with such a bill. I would like to ask her what about this bill she is proud of. First of all, it is costing Canadians $1 billion in political compensation for a political agreement, when Quebec had already gone ahead with harmonization at no cost to the federal government.
Second, how can she be proud of her government, when the promise that it made-and that was part of the reason it won the election-was to scrap the GST, not to conceal it in the price, not to conclude harmonization agreements with the maritimes at a cost of $1 billion?
The Acting Speaker (Mrs. Ringuette-Maltais): It being5.30 p.m., the House will now proceed to consideration of Private Members' Business as listed on today's Order Paper.
[English]
Mrs. Barnes: Mr. Speaker, the short answer is that I am very proud of my government because it responds to the needs of Canadians. It has travelled across the country and has listened to people. If the hon. member had listened to my speech, many examples were given to him. There are 130 exact examples in this legislation which he can read. Constituents in all ridings, I do not care in which province, will benefit from this legislation.