In response to concerns expressed by representatives from the public and private sectors, our committee sought to ensure more effective parliamentary oversight of government contracting, particularly with regard to the open bidding service. We have made a number of recommendations with a view toward making the contracting process more transparent, accessible and competitive, thus ensuring more effective management of the process by the government itself.
Pursuant to Standing Order 109, we are requesting a comprehensive government response.
He said: Mr. Speaker, as it is customary for the mover of the motion to say a brief word about the purpose of the bill, I want to say that this bill proposes the establishment of a national DNA databank. This is the second phase of our strategy to enable DNA evidence to be used in solving crimes. The first step was the legislation to enable DNA samples to be taken by warrant, which was passed a year ago.
I am very pleased to continue our commitment and to table legislation to carry out the second phase of the creation of a DNA databank.
Finally, I wish to inform the House that I propose to move that this bill be referred to committee before second reading, pursuant to Standing Order 73(1).
(Motions deemed adopted, bill read the first time and printed.)
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He said: Mr. Speaker, it is my pleasure to rise in the House today to present my first private member's bill, an act to amend the Bank Act respecting amalgamation.
This bill addresses recent proposals by a number of Canadian large banks and financial institutions to merge with smaller institutions in Canada.
The primary substance of the bill is to prohibit that process only in limited circumstances, for example where one of the institutions
under the advisement of the Superintendent of Financial Institutions could demonstrate insolvency.
The health of the Canadian financial sector would not be served by these kinds of amalgamations. Most Canadians feel very uncomfortable with some of the banks, particularly at this time, amalgamating even more power. With the help of my colleague, the hon. member for Trinity-Spadina, we propose to table this today.
We believe it will contribute in a very substantial way to the ongoing debate in financial institutions in Canada.
(Motions deemed adopted, bill read the first time and printed.)
He said: Mr. Speaker, it is a pleasure today to table my new private member's bill which would repeal Bill C-68, a gun control bill masquerading as a crime control bill, which imposes an unfair and unjust requirement for law-abiding owners of rifles and shotguns to pay new fees and register their legal firearms while it does nothing to punish the criminal misuse of firearms.
My new private member's bill will restore the Criminal Code as it was before the introduction of Bill C-68 and replace Bill C-68 with serious minimum penalties for the criminal misuse of firearms.
My bill will amend the Criminal Code to require a minimum sentence of five years for using a firearm to commit a crime or to escape from a crime scene, that penalty increased to ten years if the gun is fired. People convicted of such criminal misuse of firearms would receive a lifetime prohibition against owning a firearm, ammunition or an explosive device.
(Motions deemed adopted, bill read the first time and printed.)
She said: Mr. Speaker, I am pleased to introduce a bill entitled an act to amend the Canada Elections Act. The intention of this bill is threefold. First, the bill amends the Canada Elections Act to allow registration of a political party by the Chief Electoral Officer when the party nominates candidates in at least 12 electoral districts throughout the country, down from the present requirement of 50 electoral districts.
Under the present act, the Chief Electoral Officer must deregister a party that does not meet the conditions set out in section 28(2) of the act.
Second, the bill removes the obligation placed on the chief agent of a political party to liquidate the assets of that party when it is deleted from the registry of political parties by the Chief Electoral Officer of Canada.
Finally, the bill lowers the amount required for deposit with the returning officer at the same time the nomination papers are filed.
(Motions deemed adopted, bill read the first time and printed.)
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The second petition is a similar type of request. The petitioners call on Parliament to eliminate the right of convicted pedophiles to be let out of jail on bail pending an appeal. This would ensure the protection and safety of the victims and the community from such convicted offenders. There are 165 names on this petition.
My constituents do not believe that any amount of provocation should excuse the act of murder. Therefore, the petitioners request that Parliament review and change the relevant provisions of the Criminal Code to ensure that men take responsibility for their violent behaviour.
The petition states that because there are over 30,000 nuclear weapons on earth, the petitioners pray and request that Parliament support the immediate initiative and conclusion by the year 2000 of an international convention which will set out a binding timetable for the abolition of all nuclear weapons.
Consequently, the relevant and legal rights and obligations should be fundamentally the same for both parents before and after separation or divorce.
This petition, signed by over 300 residents primarily of my constituency, asks that the government review and change that law so that persons who attack and kill their spouses are not able to claim provocation as a justified defence.
The petitioners would like to draw to the attention of the House that our police and firefighters place their lives at risk on a daily basis as they serve the emergency needs of all Canadians. They also state that in many cases the families of police officers and firefighters killed in the line of duty are often left without sufficient financial means to meet their obligations.
The petitioners therefore pray and call on Parliament to establish a public safety officers compensation fund to receive gifts and bequests for the benefit of families of police officers and firefighters killed in the line of duty.
The petitioners therefore pray and call on Parliament to pursue initiatives to assist families who choose to provide care in the home for preschool children, the chronically ill, the aged or the disabled.
The Deputy Speaker: Is that agreed?
Some hon. members: Agreed.
April 9, 1997-The Minister of Finance-Second reading and reference to the Standing Committee on Finance of Bill C-92, an act to amend the Income Tax Act, the Income Tax Application Rules and another act related to the Income Tax Act.Hon. Christine Stewart (for the Minister of Finance, Lib.): Mr. Speaker, I move:
That Bill C-92, an act to amend the Income Tax Act, the Income Tax Application Rules and another act related to the Income Tax Act be referred forthwith to the Standing Committee on Finance.[Translation]
Mr. Barry Campbell (Parliamentary Secretary to Minister of Finance, Lib.): Mr. Speaker, I am pleased to be able to start off the second reading debate on Bill C-92, the Income Tax Budget Amendments Act, 1996.
The Minister of Finance has asked the House to approve this procedure so that it can be passed quickly, while allowing members to examine the bill in detail.
We cannot emphasize enough how important it is for this bill to be passed quickly. It includes a whole series of important measures for increasing the fairness and effectiveness of the Canadian tax system. The measures were initially unveiled in the 1996 budget, a
budget that received the support of the Canadian public and of this House.
[English]
Since that time a large number of Canadians have planned their affairs on the basis of these measures, many of which are of a relieving nature.
The introduction of this bill was delayed for an important reason. Most of my colleagues will recall that the 1966 budget included provisions to enhance the working income supplement of the child tax benefit, the so-called WIS.
In the period following the 1996 budget it became clear to the government that it had the opportunity and the obligation to do more to advance the well-being of Canadian children. This meant, among other things, revisiting the proposed changes to the working income supplement set out in the 1996 budget.
After extensive discussions with the provinces and territories, the federal government decided to propose in the 1997 budget the Canada child tax benefit. This new benefit would eventually combine the working income supplement with an enriched child tax benefit. This proposal represented a major step toward a national child benefit system. As a result, the changes to the WIS that would have otherwise been contained in the bill have not been included.
The bill was available to taxpayers in draft form late in 1996. Since that time, in keeping with the government's usual practice, taxpayers have had the opportunity to comment on the legislation and consult with the Department of Finance.
Let me now review briefly some of the measures included in the bill before us. As the legislation deals with taxation, probably the most important point to note is that it does not raise taxes, not corporate, not excise, not personal. Indeed, as my hon. colleagues know, the government has never raised personal income tax rates in any of the four budgets it has brought before the House. This is no small achievement, given the magnitude of the fiscal problem we inherited. Moreover, the Minister of Finance has made it clear we will lower taxes once we can afford to do so and once we know that it is permanent.
What the government has done in the meantime, and what was done in the 1996 budget, was to propose a number of measures to enhance the fairness of the tax system and ensure that it operates as effectively as possible. These measures included changes affecting registered pensions plans, RPPs and registered retirement savings plans. Those changes will help to ensure the sustainability of those programs while better targeting assistance to modest and middle income Canadians.
For instance, the bill proposes the elimination of the seven-year limit on carrying forward any unused portion of a maximum allowable RRSP contribution. This will make it easier for many Canadians who find it hard to make full RRSP contributions in their younger years to eventually benefit from the RRSP system when they can afford to do so. This is a very important change.
The bill also proposes to increase tax assistance to students and their families.
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First, in the area of registered education savings plans or RESPs, the bill proposes to increase the annual contribution limit from $1,500 to $2,000 per beneficiary. It would increase the lifetime limit from $31,500 to $42,000. The 1997 budget proposed to enhance tax assistance delivered through RESPs further still. The bill also proposes to increase the amount in which the education tax credit is calculated from $80 to $100. Once again this is an amount the 1997 budget has proposed to increase still further.
The bill will also increase from $4,000 to $5,000 per year the limit on the unused tuition fees and education amounts that students may transfer to spouses or parents. This measure will also be further enhanced by the proposals in the 1997 budget.
Today's bill will also improve access to training and retraining for many Canadians who have young families to care for. Specifically, it proposes to broaden eligibility for the child care expense deduction by allowing parents who are full time students to claim the deduction against all types of income.
The bill will also raise the age limit for children for whom child care expenses may be claimed from 14 to 16, thereby providing increased tax savings for families with older children. A further measure in the bill that will benefit taxpayers caring for children is the change to the rules governing child support. The bill provides that child support paid under a court order or written agreement made after April 1997 not be deductible by the payer nor included in the recipient's income. This change reflects the widely held view that the old system of deduction inclusion was not working for the benefit of children.
[Translation]
This tax measure is one in a series of measures affecting child support payments that were recently approved by the House. In addition to the tax changes in the bill, this series of measures includes guidelines for the fair and uniform awarding of child support, as well as new measures for enforcing related orders.
Not only does the bill increase support for education and assistance to children, but it also increases tax assistance to the charitable organization sector. The bill reflects the government's policy of giving charitable organizations the tools they need to do their work.
[English]
For that reason the 1996 budget increased from 20 per cent to50 per cent the annual limit on the amount of a taxpayer's net income eligible for tax assisted charitable donations. Once again this is an area in which the 1997 budget has further substantially increased tax assistance.
I will skim very quickly over some other major measures in the bill. I begin with labour sponsored venture capital corporations. Generous federal and provincial tax credits have helped these funds, sponsored by labour organizations, attract large amounts of venture capital for investment in small and medium size businesses. By the time of the 1996 budget they had more than a three-year supply of capital. In view of the substantial level of capital accumulation, the bill includes a range of measures that will help keep the level of special tax assistance to these funds in line with current fiscal realities.
The bill also includes some important measures for the energy and resource sectors. For the oil, gas and mining industries, the bill would modify rules relating to the resource allowance, thereby resulting in a more stable and consistent tax structure. As for the oil, gas and mining industries the bill proposes significant improvements to the flow through share regime, improvements that will make the system less restrictive and will remove existing incentives to economically inefficient corporate decisions.
The bill also includes measures designed to promote sustainable development of energy resources by providing an essentially level playing field between certain renewable and non-renewable energy investments.
The measures I have outlined will make the tax system fairer and more efficient. They were announced as part of a budget that has been debated and approved by the House and favourably received by Canadians. Sending the bill to committee before second reading will expedite its passage while it enhances the ability of this House to review the bill intelligently. With these considerations in mind I have no hesitation in urging my hon. colleagues to approve today's motion.
Mr. Monte Solberg (Medicine Hat, Ref.): Mr. Speaker, I am pleased to rise to address this issue.
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I must answer the parliamentary secretary's comments. He asserted at the beginning of his speech that the government had not increased personal tax rates. That is true but there are more ways other than raising personal tax rates to take more money from Canadian taxpayers. It is very important to point that out.
Another way the government can take money away from Canadian taxpayers is to change how it defines income. That is exactly what the government has done, and we must point that out.
The 1997 budget documents say that the only way to judge the impact of taxes is to measure the increase in taxes against growth in the economy. That is a good way of doing it. When we look at the growth in personal income taxes in Canada versus the size of the economy since the government came to power they have gone up over 14 per cent. The government has done that by redefining income. It has removed legitimate deductions so that overall Canadians have faced an increase in taxation. Ultimately that means that Canadians are paying more and more money.
That is why revenues have gone up over $24 billion in four years. That was not because of growth in the economy. Growth in the economy would not come anywhere near to accounting for that growth in revenue. Obviously the government has closed up legitimate deductions that Canadian families rely on. The result has been that the government does not need to make the cuts in departmental spending that it promised to make in the 1995 budget.
In other words the government cut the heart out of health care and higher education. They were cut by 40 per cent. It has closed more hospitals in the country than any premier. That is a fact. It has cut the heart out of higher education. Many university students are struggling to pay back loans because the government has cut back so dramatically in areas of higher education.
When it came to departmental spending, when it came to cutting in its own backyard despite its promise that it would cut by 19 per cent, the government failed to cut anywhere near that. It came up to about half that amount. The government went on a spending binge. It spent money on flags, on television production funds and all kinds of ridiculous things. It gave away money to Bombardier which just announced a $400 million profit.
The government has completely failed Canadians in the vital areas where the government should be responsible. It failed to provide the levels of health care funding that Canadians deserve and want. It failed to provide levels of higher education funding that Canadians truly deserve.
Contrary to what the parliamentary secretary says the budget deserves even more debate. We need to talk more about all these changes. We do not need to force it through committee before second reading. We need to have some real debate.
I want to follow up a bit more on what the parliamentary secretary said. He talked about personal income tax rates and I have addressed that. He failed to mention the government raised taxes in other areas: $1.5 billion for fuel taxes. We cannot ignore that. Canadians drive a lot. It is a big country. That impacts on all kinds of people.
Let us not try to suggest that because the government did not raise personal income tax rates people have not felt the rise in taxes. That is ridiculous.
Let us also talk about the massive $10 billion increase in CPP premiums the government has spearheaded. We just had the former parliamentary secretary for finance, the member from Winnipeg, saying in the newspaper in Winnipeg the other day that in 15 years we would have to revisit CPP. As he pointed out, young Canadians know that the changes being made are simply not adequate. They do not address the concerns of young Canadians. It is just like 30 years ago when the Liberal government brought in the CPP on an unsustainable footing. We will be put in the same situation because of the changes the Liberal government is bringing in now. We will be put in that same situation.
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The member from Winnipeg has been honest with Canadians in pointing that out. There have been $10 billion in increases on hard working Canadian taxpayers. Ultimately the Canada pension plan will not be put on a sustainable footing. I am glad the member from Winnipeg had the courage to point that out. He deserves some credit.
I want to talk about some specifics in Bill C-92, for example the child care expense deduction. The government will raise the maximum age of children with respect to who may claim the deduction from 14 years to 16 years of age. How many people put children who are 16 years old in child care? Is that really a good use of precious government resources right now? It is ridiculous.
When people in Ontario were polled a margin of 7:1 said they would much prefer tax relief for the entire family as opposed to putting more money into child care. Effectively that is what this change does. Instead of listening to the bureaucrats, instead of using our own petty reserve of judgment which the government has done, let us listen to the Canadian people. They are telling us, said by a margin of 7:1, that they want tax relief for the entire family.
Not coincidentally that is exactly what the Reform Party proposed in our fresh start platform. We say that parenting is valuable irrespective of whether the child goes to day care or a parent chooses to stay at home and raise children. We proposed changing the child care expense deduction to a credit and extending it to every family in the country who has children 12 years of age and under. That will put more money in the pockets of all Canadians and not discriminate against those people who choose to stay at home with their children. I cannot believe the government allows that to continue when Canadians have spoken out so clearly in favour of the plan we propose.
Another change in Bill C-92, which I noticed the parliamentary secretary did not focus on, was government was requiring RRSPs
to mature at age 69 rather than at age 71. The Canada pension plan is under tremendous pressure today. People have admitted in the Liberal caucus they do not have confidence the Canada pension plan will be there to serve them well. This is what the member from Winnipeg was talking about the other day.
Why in the world are we saying that from here on in people will only be able to contribute to their RRSP until age 69? The two years between 69 and 71 are precious years for compounding. That is when they have the most money in their RRSPs. If there is another two years to contribute and to allow compounding to happen it would mean a lot more income. Unfortunately the government seems to take the approach that people should be penalized for trying to provide for their own retirement.
I fail to understand why we should be allowing the bill to be pushed through so quickly when it is an important issue. Canadians obviously feel very concerned about the viability of the Canada pension plan, especially considering the sorry record of previous federal governments and this one too in ensuring that the Canada pension plan has the necessary funding to provide for all Canadians.
I will touch for a moment on the issue of foreign reporting rules. I will allow my hon. friend from Calgary Centre to speak on this issue in a bit more detail. With respect to foreign reporting rules the government is proposing that people with offshore assets of over $100,000 must declare them and fill out the paperwork. I do not deny that there are some people who abuse the reporting of income from assets held offshore. Undoubtedly that happens. It happens in Canada as well. That is why we have auditors who go around checking these things. To all of a sudden make the assumption that all people are cheating and we have to record all their assets is absolutely ridiculous. If we apply that principle we should be doing it in Canada as well.
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The government should be focusing its resources on doing more audits, if it is suspicious about people not reporting income, instead of creating one more massive bureaucracy. There will be truckloads of forms that will have to be filled out. It will ultimately cause some people to leave the country because they will not want to face that kind of scrutiny from big brother.
My time is up, but I invite my colleagues in the Reform Party to have another go at this ridiculous bill.
[Translation]
Mr. Roger Pomerleau (Anjou-Rivière-des-Prairies, BQ): Mr. Speaker, I am pleased to speak to Bill C-92, which in a way brings the Income Tax Act and another act related to the Income
Tax Act in line with the 1996 budget, last year's budget in other words.
Before I begin, I would like to indicate my agreement with my hon. colleague from the Reform Party when he says:
[English]
``This government closed more hospitals than was ever done before by any other government''. He is absolutely right. That is the reality of things.
[Translation]
There was absolutely nothing new in the 1996 budget and, ever since it came to the House, the Bloc Quebecois has, as you know, been calling for a complete reworking of the Canadian taxation system in order to bring it up to date. Since our arrival, we have been recommending an item-by-item analysis of all government expenditures.
This was not to be found in last year's budget, nor will it be in this year's. At the very most, the Minister of Finance announced in the last budget the creation of a technical committee on corporate taxation, or more specifically on tax havens.
The mandate of this committee is, however, too narrow for these recommendations to lead to the changes required to get Quebecers and Canadians back to work. It contained no measures specifically related to employment or to ensuring an equitable division of the tax burden between individuals and businesses on the one hand, and major corporations and small and medium size businesses on the other, the latter being the true creators of employment in both Canada and Quebec.
There are still serious doubts about the objectivity of the members of this committee. Several come from big private companies which advise wealthy clients and major corporations on how to avoid paying taxes. Certain members of the committee are, therefore, in a definite conflict-of-interest situation, and we spoke out against this situation last year.
We know that this committee has had an extension and must table its report by the end of 1997, after the election of course, and we also know that the majority of members of the committee examining the use of tax shelters by corporations themselves make use of tax shelters, and often have businesses in the tax havens they are supposed to be studying.
Yet, in its 1996 budget, the government attacked one tax measure, perhaps the only one, while unemployment is still rampant, and the Liberals have not succeeded in meeting their election promise of jobs, jobs, jobs. It has not been said often enough, nor can it ever be said often enough: the Minister of Finance has directly attacked a priority tool for job creation. The Liberal government has cut the tax assistance to workers' funds, in particular by reducing the federal tax credit linked to these funds, and by decreasing the annual maximum that can be invested in them.
The Bloc Quebecois was very critical of this decision, as you know, and even suggested, when tabling its documents on tax reform, that the maximum annual amount should be restored to the level it was before the cuts were made. We must not forget that the purpose of these funds is to create or protect jobs, mostly in Quebec. The FTQ fund alone was able to preserve or create 38,000 jobs.
The government remains inconsistent. It talks about job creation and then savagely attacks the only tax measure we could be absolutely sure would create jobs. This measure, as we said before, mainly affects Quebec, because half of the money in these funds comes from Quebec. The Bloc Quebecois has constantly been after the government on the tax system. We did so in the case of family trusts, and although the response was not always satisfactory, we have done this systematically. We did so in the case of the GST, a government promise that was not kept, and in the case of the shocking abuse of tax havens.
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From the outset the Bloc has been asking for a thorough review of both corporate and personal taxes. This aspect of our tax system has not been updated for many years.
But we did more than criticize. Since we were well aware that last year the government did nothing and had no intention of doing anything in this year's budget, which has been confirmed, the Bloc did some research and drafted two papers, one on corporate taxation which received the approval of the Minister of Finance, who said we did a professional job. He took the report we wrote but has now probably dumped it in file 13.
We produced two analyses that consider all aspects of corporate and personal taxes, something that normally should have been done by the government. I may remind you it has been quite some time since Canada's tax laws were reviewed. I may also remind you that this is the first time an opposition party did the government's job by doing its own analysis of the tax system, something the government should have done.
The opposition parties have a relatively small budget for research and compared with the government, their resources are extremely limited. Nevertheless, we took the trouble to produce this study and do a full analysis of the tax system.
I would like to give you some idea of the work that was done on corporate taxation, for instance. But first, I would like explain, for the benefit of our listeners, what a tax expenditure is. When we sit on committees, the first thing tax experts tell us when they come to meet members and individuals sitting in is: ``Tax laws are extremely complicated. You will need our help plus a whole battery of lawyers to understand the system''. I would say that tax laws are
purposely obscure so the general public cannot understand what they mean.
I recommend reading Linda McQuaig's book recently published in English in Toronto as The Lion's Share and translated into French as La part du lion. The book shows, over a period of 30 or 40 years, precisely how wealthy Canadians used tax leverage to their advantage and to the disadvantage of the ever poorer middle class.
Fiscal spending occurs when a tax deduction is accorded for some reason to a corporation or an individual. When an individual is accorded a tax deduction of $1,000, it is as if the government sent them a cheque for $1,000-because this amount was owing to the government-as in the example given, but it looks better.
Clearly if the government sent a $50,000 cheque to a company, the public would understand what was happening and would object, so it gives a $50,000 tax credit under some provision described in a book somewhere in a huge pile of books. Nobody sees what goes on, but the $50,000 will be paid by someone other than the company-the general public.
So, if this sort of tax arrangement is made for all companies, which is what is happening in Canada, little by little, the tax burden is displaced and transferred from corporations, the rich, to the middle class, which is becoming poorer for having to pay others' taxes.
I would like to point out that we used the Carter report from 1962, which remains valid today in many cases, to prepare our analysis, which comprises some 100 pages on corporate taxes alone. We have clearly shown this in a table based on statistics on personal taxes for the 1993 taxation year taken from government documents.
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We have clearly shown that, since 1950 to date, more and more taxes have been transferred from companies that should be paying them to individuals who are in fact paying them now. I would like to cite five key dates as examples, even though the trend remains constant from year to year. These five dates reveal the extent to which the tax burden has shifted from the companies-the wealthy-to individuals: in 1952, 51 per cent of Canada's income taxes were paid by corporations; in 1962, 36 per cent; in 1972,20 per cent of taxes were paid by companies; in 1982, 17 per cent; and, in 1992, 7.6 per cent. These figures are from Statistics Canada.
As we can see, from 1950 on, the burden has shifted, with the tax load being transferred from the rich to the middle class. So, today, when we look at the number of unemployed, the number of people on welfare and the number of poor people in Canada, we see that the rich have succeeded in transferring their tax debt to the people in the middle class, who are becoming increasingly poorer.
We would have liked the Minister of Finance to really examine and utilize both last year and this year the reports we provided, which he himself described as highly professional and which are based on Statistics Canada figures.
I close on this point. In the 1996 and 1997 budgets, we saw no effort by the minister to look hard at Canadian taxation.
[English]
Mr. Derek Lee (Scarborough-Rouge River, Lib.): Mr. Speaker, I am pleased to engage in the debate on this motion which would advance the government's bill to implement elements of the 1996 budget.
I could not help but reach a conclusion earlier this morning that some of the opposition comments are bordering on the hysterical. I refer to some remarks of colleagues in the Reform Party. Some of the remarks are less than accurate.
I want to attempt to put some balance into the record. For example, there was a suggestion that there was a 40 per cent reduction in the transfer payments from the federal government to the provinces which impacted on education, social programs and health care.
What the Reform Party fails to acknowledge, and I stand corrected if I am wrong, is that at the time those transfers were renegotiated with the provinces there were tax points transferred as well. Tax points are the equivalent of cash.
This is a process whereby the federal government actually turns over to the province the equivalent of a tax point, 1 per cent or a portion of a point of taxes. That is worth money, just as a transfer of cash is.
For someone to stand in the House and not include that in their remarks in discussing transfers to the provinces, whether equalization or the old CAP or whether it is under the current Canada health and social transfer, is less than accurate.
There was also a remark that the federal government has closed more hospitals than the premiers. This could not possibly be a fact. Most Canadians know that the federal government does not administer hospitals.
Hospitals are administered locally and by provinces. To my knowledge, the federal government has not closed a single hospital unless there is some reference to the national defence medical centre which is not closed but which continues.
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I think that is less than accurate, if I can continue to use that euphemism, in suggesting it. It is utter nonsense for the Reform Party of Canada to say, and I am quoting what the hon. member said, that the federal government has closed more hospitals than the premiers. Please set me right if I am wrong on this.
An hon. member: You are wrong.
Mr. Lee: The member will have an opportunity to speak later.
I am also struck by the degree and amount of what I will call the retropromise. It seems that anything that has moved within the last three or four years is now being characterized by the almost hysterical Reform Party and sometimes members of the Bloc Quebecois as a promise. If I per chance two or three years ago had told someone I intend to be in Ottawa on Thursday, hon. members opposite seem to have a penchant now for characterizing those words as a promise.
Day in and day out now in this debate we have constant reference by members opposite to what I call the retropromise. If it moved it was a promise and in the event that I did not happen to show up in Ottawa on Thursday, I broke my promise. That is not fair. I think Canadians see through that.
Aside from these deliberate acts, misleading revisionism involving the retropromise, there are a couple of other areas I could not help but note and I think Canadians noted as well. They are references to tax increases. I have heard members opposite talk about increases in taxes. What they are really talking about is that there has been growth in the economy, there has been population growth, there have been increases in business revenues. Everyone knows that when that happens there is an increase in tax revenues.
If hon. members opposite want to call that tax increases, they can do it but I do not think that is fair. I think that is misleading. When this government says that it has not increased taxes in a certain area, that is the truth. When members here say that, it is the truth and they mean it. When members opposite say there has been a tax increase, they seem incapable of speaking straight on the issue and what they really mean is the economy has grown, business revenues have increased, the population has increased and therefore tax revenues have increased.
I hope members opposite will forgive the growth in the economy and forgive the increasing prosperity of this country for generating more tax revenues.
I do not have any illusions that my remarks today will make much of a difference in the rhetoric around this place, but I thought I should put that on the record.
I want to address as well one of the items in this important bill dealing with the budget. I want to talk about the proposal to reduce the age limit for maturing registered pension plans, RRSPs, the reduction in the age for contributing to those plans from 71 to 69. What that means is simply that individuals will not be able to contribute to RRSPs or accrue pension benefits after age 69. They will also have to start drawing income out of those plans by the end of the year in which they turn 69.
This change is being made for a number of important reasons. The first reason is that it will help to move the maturation age for retirement savings and pension plans closer in line with the ages at which most Canadians will start retiring. The simple fact is that very few Canadians are saving for future retirement when they are in their seventies.
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A second and closely related consideration is that the proposed measure will limit the use of RRSPs for estate planning purposes, that is, what will happen to a person's cash and assets after they are no longer with us. The use of the RRSP for that purpose is outside of scope of what was originally intended. The RRSP is for the living. It is for the person who is retiring, and the type of generous tax assistance provided to the RRSP mechanism was never intended for estate planning purposes.
There is the broader question of cost. The federal revenue cost of tax assistance for retirement savings is now quite significant. Technically, inside government it is called tax expenditure. It is really a question of tax revenues forgone in assistance of the retirement savings mechanism. In 1993 that tax expenditure totalled nearly $16 billion. As the finance minister has made very clear, the government is firmly committed to preserving Canada's retirement assistance program which serves a vital function. It does so in a very effective way, measured in both Canadian and world standards.
However, steps had to be taken to ensure that this program remained financially sustainable. The cost of the program was limited while assistance was targeted where needed. Even with the changes announced in the 1996 budget, the system will remain a generous one.
As this is an important debate on important legislation, I return to my opening theme which is to encourage colleagues in the House to try to stick a little closer to the straight line of accuracy when they use terms like those I have mentioned. I respect the need of the opposition parties to hit hard at things. They do not think our policies are the way they should be but it would help us all if we would use a standard of rhetoric and a standard of language. We should use terminology that keeps us straighter to the line and that allows Canadians to better understand the public policy issues that we debate here.
Mr. Jim Silye (Calgary Centre, Ref.): Mr. Speaker, I rise to add my two cents worth to this debate and to talk about the 1997 budget. I will discuss five or six points.
First, the budget projects a deficit of $19 billion. That is an awful lot of money. Yet the government is bragging that this figure means that the back of the deficit has been broken. It spends $19 billion more than it brings in and it claims that it has broken the back of the deficit. It came in with a deficit around $42 billion. It boosted it to $42 billion from $38 billion. It has reduced it to $19 billion
which is a little over half. It has taken the government four years to cut the deficit by $23 billion. In my estimation that is just half a job. It is only half good which means it is also half bad.
It is a shame this finance minister brags to the nation that our finances are in good order. We are spending more than we bring in. He is giving the Canadian public a false sense of security. It is one thing to hold out hope-which is important-but it is another thing to claim victory before you have won the battle.
There is another thing I do not like about this budget and the finance minister. The finance minister plays games. He cooks the books. He does what the previous member just talked about. He borderlines on representation and sometimes comes close to misrepresentation. He reduced the social transfer by $7.5 billion, which I believe is an accurate number. I believe it covers health care, welfare and education. I believe it affects all the provinces. I believe it means they have less money to put into health care, education and welfare, which means they in turn have to do something and the problem has been transferred to them. It is called downloading, I believe. I believe all those statements are accurate and true and not a misrepresentation.
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To justify this painful decision, which I also agree had to be done, the government said it would cut $9.5 billion or $9.8 billion from departmental program spending. That is the amount of money that is spent, excluding these transfer payments to provinces. After four years only $4.6 billion has been cut. There are $5.2 billion missing.
The President of the Treasury Board tried to explain it to our finance critic and our deputy critics. He almost had them hoodwinked. Talk about misrepresentation. Talk about cooking the books. Talk about keeping on the straight and narrow and being honest with the people and telling them the way it really is.
I am not going to distort this, I am going to be very accurate. What really happened in this case is that the government, in order to come up with an explanation on why it is $5.2 billion short of its projected $9.8 billion promise after four years said, ``wait a second, there is another year''. Plus the government has changed the definition of departmental spending between what it was in 1995 and today. That is accurate because it came right from the Treasury Board officials when we met with them.
That is how the government can claim that it kept to 18.8 per cent and how $4.6 billion now represents 18.8 per cent in program spending reductions versus the $9.6 billion, the definition in 1995. This is how the government plays games, and I am tired of it. I hope that the Canadian public is tired of it as well.
The finance minister has gone against generally accepted accounting principles. The auditor general slapped his wrist for it in the last budget.
The public accounts committee will be meeting in two weeks. I have asked for finance minister's presence but he cannot make it because he is busy. However, the deputy minister will be there. I want to know how they can get away writing off $961 million on the harmonization of the sales tax in the budget two years ago when the money just went out last October.
There are $800 million for the foundation for innovation that will be spent over the next five years which is written off in this budget. That is not right. There had better be a darned good agreement with that foundation. There had better be a darned good signed agreement with all the provinces on where the money is going and who is going to get the money for innovation. If not, the books are being cooked. Public sector companies get fined by Revenue Canada for doing things like this.
Money cannot be written and charged off to a year's expenses unless that money has been spent or there is an agreement in writing in which the money is committed to be spent in a short term, meaning one year, not five. We will see. The meeting is coming up in two weeks.
I have already heard government members say twice now that the government has not raised personal taxes. I agree. It is a true statement. Then the finance minister and even the Prime Minister in question period say, ``We have not raised taxes,'' which is a much different statement. Is that not misrepresentation? Is that not borderline with what the member just talked about and that he wishes members would not do? I wish he would talk to his finance minister and to his Prime Minister and tell them not to do it because they are giving Canadians a false sense of reality.
Finally, after being pushed by our finance critics they agreed: ``Yes, if you mean that we have eliminated loopholes for wealthy companies, yes, we have increased taxes. If you mean that we have done insurance things, yes, we have increased taxes''. We finally got it out of them. Then a day later they said: ``We have not raised taxes''.
There are two ways to raise taxes. If it is the personal tax rate, they have not done it. I agree. But they have raised taxes through the elimination and reduction of the sizes of exemptions and what can be deducted. Therefore, they have raised taxes 35 times.
Let me give another example of the games they play. My colleague from British Columbia submitted a petition prior to the 1995 budget about not raising taxes on gasoline. We are afraid of it, and were saying, do not do it. They claim they have not raised excise taxes. We know they have. We know that two years ago they
raised the excise tax on gasoline by 1.5 cents. Is that true or not true?
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An hon. member: That's true.
Mr. Silye: A Liberal said: ``That's true''. They raised excise taxes on gasoline by 1.5 cents per litre, which amounts to an increase in government revenue of $1.2 billion to $1.4 billion. That is a tax increase, is it not? It is a tax increase. I got that concession as well.
In response to the petition, here is what the Department of Finance, perhaps under the influence of the finance minister, claims: ``-that the past two budgets presented to the House of Commons in March 1996 and February 1997 contained no tax increases in any area. In particular, these budgets did not propose any increases in the excise tax on gasoline''.
It went on to say: ``Since taking office the government's budget savings have been secured principally from expenditure reductions rather than tax increases. Ninety-one per cent of the $28 billion reduction in the 1998-99 deficit is due to expenditure reductions. These budget initiatives will enable the government to keep moving toward budget balance''.
Let us see how close that is to the truth. Let us see how close that is to borderline misrepresentation.
These are bureaucrats that work for the Canadian people. Are they not supposed to be honour bound? What they said in the first sentence is true. They did not increase the excise tax on gasoline in this budget or in last year's budget. The increase was contained in the budget previous to that.
That is playing mind games. That is playing word games. We all know that. This kind of stuff makes me sick. It is one of the reasons I am getting out of politics. We do not have enough people who are prepared to tell the truth and hold the course. That is why politicians are held in such low esteem in the country. They do not keep their election promises.
Provincially it is slowly changing. Alberta especially has done an excellent job of holding the line. Ontario appears to be following, although it might be wavering on a few promises because of the pressure of the 98 federal Liberals in Ontario who want the Ontario government to start spending money.
There have been 35 tax increases. The department says there have not been revenue increases, but that there have been expenditure cuts. That is not true. Tax revenues have increased by $30 billion. Yes, a lot of it is due to growth in the economy.
Let us talk about that wonderful growth. It is 2.5 per cent. Boy, that is a booming economy. Darn, that is almost the rate of
inflation. It has been just a bit higher in the last couple of years. Boy, they have done a great job. Two per cent per year for four years. That is wonderful. We should all clap and be happy.
Yes, that has increased tax revenues. However, the 35 tax increases, which represent $30 billion in revenue, amount to about $12 billion in extra tax revenue due to tax increases. It is not all attributable to growth in the economy. If any member opposite says it is all due to growth in the economy they are misrepresenting the issue. He knows that.
Do I have time to wrap up my comments, Mr. Speaker?
The Deputy Speaker: The hon. member may not wrap up his comments as his time has expired.
[Translation]
The hon. member for Portneuf.
Mr. Pierre de Savoye (Portneuf, BQ): Mr. Speaker, I am pleased-
[English]
The Deputy Speaker: Excuse me. With the rotation principle, the hon. member for Mississauga South has the floor.
[Translation]
Mr. de Savoye: On a point of order, Mr. Speaker. The member who spoke before the hon. member from the Reform Party was a Liberal member. If there is to be rotation, it should be-
The Deputy Speaker: Unfortunately, the rotation is from one side of the House to the other. It is a matter of numbers-
Mr. de Savoye: It is your call, Mr. Speaker.
[English]
Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker, I am pleased to rise in support of Bill C-92, an act to amend the Income Tax Act, the Income Tax Application Rules and other acts related to the Income Tax Act at second reading.
The Deputy Speaker: I am sorry to interrupt the hon. member for Mississauga South. Rotation in this type of debate is not back and forth across the floor, it is the parties going round and round.
[Translation]
I will recognize the hon. member for Portneuf. He was right.
Mr. de Savoye: Mr. Speaker, once again, I am pleased-it is not everyday that we get to start over the same speech-to speak to Bill C-92 to amend the Income Tax Act.
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The subject of income tax raises the spectre of government digging into the pockets of individual and corporate taxpayers in order to cover its expenditures.
I cannot help but notice that our finance minister's insatiable appetite is caused by the fact that, for many years, government spending has exceeded government revenues. The Minister of Finance spends more than he earns. In fact, he is like the captain of a boat that is taking on water. Because the Minister of Finance has failed to plug the holes, the ship is sinking.
The finance minister did reduce the deficit. He did slow down the rate at which the water is flowing in. But do you know how he did it? Not by plugging the holes, but by throwing bucketfuls of water onto the provinces' ships. His financial needs and appetite remain unsatisfied. He needs more and more money, which, of course, comes out of the pockets of taxpayers.
It must be realized that the overall situation as regards taxation and public spending, both at the federal and at the provincial level, including in Quebec, is not good, and the basic problem that gave rise to all these difficulties originated in this House, right where the finance minister sits.
We saw how the Harris government, in Ontario, and the Quebec government headed by Mr. Bouchard were forced to take drastic measures and to make deep cuts to the health and education sectors, and even to their own human resources, the provincial public service. Indeed, we witnessed very sad situations experienced by people in Quebec, in Ontario and in other provinces. The public must realize that these problems are not created by the provincial governments, but that they have their roots in this House, right where the finance minister sits.
The minister simply dumped his problem on the provinces, by cutting the funds that were supposed to go to the provinces. He did so in two ways. First, by reducing transfer payments. What is a transfer payment? Under this process, the federal government essentially gives back to a provincial government the money paid by the taxpayers of that province. However, in this case, the federal government simply decided not to do so, with the result that the provinces are no longer getting the money to which they are entitled. We are talking about $2 billion, which was earmarked for health services and higher education.
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It comes as no surprise that the provinces, including Quebec, were forced to cut services and budgets relating to health and education, given that the $2 billion paid to the federal Minister of Finance by Quebec taxpayers was never given back to the province.
But there is something else which, in a way, is even worse. The minister has developed the bad habit of taking $5 billion a year out of the employment insurance fund, which used to be called the unemployment insurance fund. Five billion dollars is an awful lot of money. In fact, what the Minister of Finance has done is to artificially create a tax on the backs of workers and their employers.
If we look at it in terms of proportions, we could say that each time a worker or an employer pays a dollar in premiums to the EI fund, 30 cents of this dollar will be skimmed off; not borrowed, not put into a separate fund for the eventual benefit of workers and employers but, when it boils right down to it, diverted from its initial purpose, which was to provide for the future needs of the unemployed, and used to reduce the finance minister's deficit.
Of course the Minister of Finance can then say he has reduced the deficit. Let us be clear. He has not eliminated the deficit, he has not prevented the ship from taking on water, he has not pumped out the water that is already slowing us down. No. He has just reduced the amount of water in the hold. How did he accomplish that? By passing on the problem to employers and employees throughout the country, using 30 cents of every dollar to mop up the consequences of the deficit. It is a tax in disguise that the Minister of Finance will not admit to publicly.
Fortunately the official opposition is here to denounce it, to explain it and to see that people understand clearly that what is happening provincially is not the cause, that the provinces are not to blame, but rather the method of operating imposed by the Minister of Finance, here in the House.
Something must be done about what is going on and, as my colleague mentioned earlier, the Bloc Quebecois has proposed in this House appropriate, detailed and carefully thought out measures to rectify the discrepancies that now exist in tax measures. In fact, with respect to individual taxpayers, the Bloc Quebecois has produced a well researched document in which it proposes to the finance minister ways of eliminating unfairness and introducing new measures that would help families and others.
With respect to corporations, old tax loopholes that are to all intents and purposes no longer used, except by corporations rich enough to do so, should be eliminated and replaced by measures more likely to encourage businesses to create jobs.
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One of the things I should perhaps point out in closing is that it is unfortunate that the Minister of Finance has not at least implemented one of these measures, which was intended to prevent corporations from deferring taxes indefinitely. As things stand now, corporations are in a position to avoid paying taxes today, next year
and for years to come, because of certain provisions in the Income Tax Act.
The Bloc Quebecois has asked, and will continue to ask the finance minister to take action to eliminate these measures and replace them with new measures that are effective and productive and that, above all, show respect for the citizens of Quebec and of Canada.
[English]
Mr. Paul Szabo (Mississauga South, Lib.): Mr. Speaker, I am pleased to debate Bill C-92 at second reading. The parliamentary secretary well laid out the principal features in Bill C-92. I do not propose to repeat them. He has done an excellent job.
I take this opportunity to put on record my views on an issue that has been raised in my constituency by a number of my constituents, particularly seniors. It is modifications to the RRSP rules, particularly with regard to the lowering of the age at which contributions can be made down from 71 to 69.
There has been much written in seniors publications about this. One need only look at who is offering these publications and these articles. One has to assess what their motivation might be.
An article has been circulating by a former member of this place, Garth Turner. He is suggesting this change is awful, that it will cost anywhere from a $36,000 reduction in the value of an RRSP account for a Canadian.
I want to attempt to explain how one might account for this apparently significant number and why it is very misleading. The maximum contribution under RRSPs is currently $13,500. To the extent that a taxpayer would not be making contributions in either their 70th or 71st year, it means that $27,000 will not be contributed to the plan. Therefore naturally the planned value will not be as high if those capital contributions have not been made.
Second, there would be an additional two years of interest accumulation on all contributions that have been made throughout the contribution lifetime of the taxpayer which would not be accumulating and compounding during those two years.
Of the $30,000-odd that the accounts would be lower, this represents some $27,000 of capital which Mr. Turner, if entirely honest with Canadians and with seniors, would say that although their RRSP account will be lower by $27,000, their bank account would be higher by $27,000 because that contribution was not made.
It is absolutely intellectually dishonest for anyone to suggest that there is this loss of principle simply because it is not in one pocket but in another. We have to look at value of the wealth of an individual in all its forms.
I want Canadians to reflect on what is happening when RRSP time comes around. There is a feeding frenzy of people trying to sell RRSPs. One has to wonder why it is important for them that we buy from this one or that one. There is one very simple reason why they are trying to alarm the public about this. This is when they earn their living. This is when they make these massive commissions on selling.
These commissions are charged through to the funds that we are investing in and passed on to us through management fees and general expenses of the fund management. They have a vested interest in selling more and more simply because it means money in their pockets.
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I want the ordinary taxpayer and those seniors watching the proceedings or will read Hansard to know there is another part of the story they have to look at. It is not in the best interest of any taxpayer to see how much money they can put into an RRSP. The real issue is how much can they put in and what plan do they need to get it out with the lowest possible tax consequences.
Many Canadians are fortunate to earn substantial amounts of money which allow them to buy $13,500 of RRSPs and effectively obtain a 50 per cent tax savings as a result of that contribution. If they turn around and purchase an RRSP for a spouse who is not working and come retirement time take their corporate pension and the spouses who are working in the home take out the RRSP moneys, they have effectively split the income and are both paying at a lower rate.
The tax rate at which the contribution was put in was high. The tax rate at which the contribution is paid out is low. There is an automatic windfall in rate. Never mind the savings by the virtue of the fact that they have government money on which they are able to earn investment income. Everybody is entitled to that. High income earners are entitled and have an opportunity to income split or by set up their income averaging annuities in a way that allows them to stream the income out at the lowest possible rates.
The best advice in my view for Canadian taxpayers is not how to get the total amount of money into the RRSP. When it is one's time to go and there is no surviving spouse, the full amount collapses and is taxed in the year in which a taxpayer is deceased at the highest possible rate.
Canadians have to look at their spousal situation. They have to look at their personal health situation and they have to anticipate.
Although I am a chartered accountant I do not propose to give advice to anybody on how to manage their affairs, but I raise these issues for them to ask the questions of people who would suggest that somehow not being able to put money in an RRSP is bad. My own personal view it is best to wonder how to get it in and how to get it out at the lowest possible rate.
On top of that taxpayers should know that once the moneys come out of an RRSP and are taxed in taxpayers' hands at a lower rate they have an opportunity to do something with the cash. One of the best recommendations I had for some family members I have talked to was to help out their family members who do not have the cash flow they need to invest in their own RRSPs so they can start building up and preparing for their retirement income.
When gifts of cash given to family members who are 19 years of age or over there is no income attribution back to the person who gave the money to them. It is important for taxpayers to look at the long term plan of not only building up an RRSP fund and getting a good return but also finding out a strategy on how to stream that money out for the best tax advantage for the family as a whole.
I hope Canadian taxpayers and certainly seniors in my riding will be cognizant of the other questions to ask experts in RRSPs whose only interest is that they want to sell more. They have to ask them: ``What is my plan to get that money out? How can I make it work the best for me, for my spouse, for my children and for other family members?'' Families do care about the financial health and the physical health of all family members. That is the way it should be.
Mr. Garth Turner and others tend to bring forward rash generalizations about what a terrible thing it is. They have been intellectually dishonest with taxpayers if they suggested the change in years from 71 to 69 took cash from RRSP accounts without saying that it increased cash in their personal bank accounts. That is telling half the story.
Canadians have to know where they are coming from. Canadians have to know why they are trying to push RRSP investments on them. It is because it is in their best interest with the high commission rates they are getting.
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I know some would think those are strong words, but every now and then Canadians have to be alerted to the fact that they need the whole story from the beginning to the end to ensure the decisions they make are in the best interest of not only their own financial planning but of the rest of their family members.
I hope this insight into one aspect of the bill will help Canadians to ask questions that are important for them when looking at retirement planning.
Mr. Ian McClelland (Edmonton Southwest, Ref.): Mr. Speaker, as I stand to speak to the budget debate it would be fair to say that I speak for millions of Canadians from coast to coast to coast. If things are so good why do I feel so bad? If things in our economy are so good why do I not have any money?
All Canadians appreciate that for all levels of government, municipal, provincial and federal-and the federal government especially has by far been the most devious-taxation no longer has much to do with income or resources. It has more to do with licensing. If the tax stream coming in from people is based on profit or income it is variable. Governments do not like variable income. They like income that they can depend on. Therefore far less of our taxes have anything to do with how much money we have, how much money we have made or our profit. It has more to do with the privilege of being either in business or having the privilege of earning income.
I use as an example the recent changes to the Canada pension plan, perhaps the most nefarious of the worst investments any individual could make, particularly a young Canadian, with rates going up to 9.9 per cent. The finance minister and the Prime Minister are now the only two Canadians who say they are not taxes. They call them investments. It is a pretty rotten investment that takes 9.9 per cent of the working income of Canadians for their lives and gives them a return on investment of about $9,000 after 40 years.
Canadians have this ever increasing tax burden that is represented to them not as taxes but as licence fees, mandatory investments or whatever it is. It is almost impossible for a politician not to spend other people's money if it means there is a potential for the politician to be re-elected. That is the way it works.
In my lifetime one did not get elected by telling people they had to live within our means or that we did not have any more money. One did not get elected by saying it is unfair to tax future generations of Canadians so that we can live beyond our means today.
What government has ever been elected by looking people in the eye and telling them the truth? Certainly not this government and certainly none of the governments that got our country into this mess.
The reason our country is in the mess it is in today is that politicians have had a free hand to spend other people's money, taxpayers' money, to get re-elected.
How can we get ourselves out of this mess? We must say the only way to possibly reduce taxation levels is to reduce the size, the scope and the intervention of government in our daily lives. If we are not prepared as individuals to assume responsibility for our own lives, if we as individuals pass off responsibility for our lives to other people through governance, then it will take more and more and more resources of the nation to fund it.
The first step is for Canadians to say they have had enough government; they want less government; they are sick and tired of it; and they are not going to take it any more. The only way we will
achieve that is to elect people who will look us in the eye and tell us they must be responsible for lives. We cannot ask others to be responsible for our lives.
Collectively we will be responsible for each other. If we cannot first look after ourselves, how can we look after others? The interdependence we cherish is based on personal independence. If we cannot first be independent, how can we be interdependent?
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This brings me to the second item I would like to speak about, which also refers to the taxation by stealth the country has been living under for the last couple of budgets. It has to do with the changes to the support payments for parents who divorce or are separated.
It used to be that when families unfortunately split up the custodial parent, the parent with the children, received money from the non-custodial parent. The paying parent earned a higher income and the taxes were paid by the receiving spouse, usually the female. She had the children. Her income was usually lower than that of the male and therefore she paid less tax.
This situation has been changed in the budget. The taxes will now be paid by the spouse who makes the payments. The money will be received by the custodial parent. There are benefits to that, one of which is that at the end of the year the custodial spouse will not be nailed with an unexpected tax bill. In all cases they should expect it, but the reality is that most of us as human beings do not make provision for it and it comes as a surprise.
That tax windfall, the changes in that tax ruling, will mean the federal government will take in an additional $200 million. The question is whether that $200 million will be turned back directly to the care and maintenance of children and whose children will be maintained by that.
It should be the parents who make the decision on how the $200 million is spent. There is no reason in the world why in the absence of an agreement on separation the taxes could not be split 50:50. There is no reason in the world the default position could not be 50:50. With agreement by both parents in the court either parent could pay the tax. The taxes should be paid in the interests of the children so the majority of the money would stay with the children. Instead we have gone from all in one direction to all in another direction, which does not make sense.
In the debate on the bill that spoke to the issue the point was made that there was no connection between access, custody and support payments. The only people who would make that assertion are people who do not know anything about it. If there is a problem in maintenance payments, in the regularity of the payments being made, obviously there will be a problem with custody. That is usually where the problems arise when there are problems. I do not know if it is possible for legislatures to legislate common sense. In times when people's emotions are running on high it is difficult for the government to say: ``Wait a minute. You have to put the interests of your children first''.
We can ensure the laws, the rules and the regulations we enact enure to the benefit of the children and make it less likely that there would be an explosive situation to be dealt with. It seems that maintenance payments are a tinderbox in relationships that have gone bad and that there is a continuing acrimony between the two parents. There might be a better way to handle the matter. I do not know what we have arrived at will achieve what it is hoped to achieve.
Earlier the member opposite spoke about RRSPs and the changes in the budget which affect the collapsing of RRSPs. He did not say that it is the compounding of the money in the RRSP in a tax protected state that brings additional benefit to the people who own the RRSPs. RRSPs are the vehicle of savings for the vast majority of Canadians.
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The vast majority of Canadians really do not have any savings outside of their RRSPs because there just is not that money. The increase in taxation by all levels of government, particularly by the federal government over the last few years, has sapped the total growth in the economy. When governments through taxation suck every bit of growth and money out of the economy then what is left to reinvest to create the new jobs?
It is only through the decrease in taxation by all levels of government, particularly the federal government, that there will be money left in the hands of taxpayers that will be used as investments and purchases in a consumer economy.
The changes through the seniors benefit were not mentioned at all. We are talking now about taxation by stealth. For the information of members opposite, there is a change to the old age security and the guaranteed income supplement. The seniors benefit which combines both ensures on a universal basis that all Canadians will receive $11,420 a year without tax but then the tax provisions that used to be on the guaranteed income supplement will be on the whole kit and caboodle. Old age security will be taxed by this government, which has said time and time again ``don't worry, seniors, we are your protectors, nothing is going to happen''. It combined the two, changed the name and it is taxing it all back.
That means that all pension income, including RRSPs, will be taxed back at 50 per cent on the first $12,500 after the new seniors benefit.
Mr. John Williams (St. Albert, Ref.): Mr. Speaker, I rise on a point of order with regard to the terms of reference for Bill C-92 and Bill C-93.
Notice has been given to refer these bills to committee before second reading. The minister has already moved to refer Bill C-92 to committee before second reading pursuant to Standing Order 73(1). Bill C-93 is the next item on the government's list today and we have already received notice that this bill will also be subject to Standing Order 73(1).
I bring this to your attention today because this is a new standing order and it is under test. We as parliamentarians have a responsibility to ensure that the intent of a new standing order is not distorted and we must ensure that any rights and traditions are not intentionally thwarted by any distortion of the use of a new standing order.
On Monday, April 7, 1997 the House passed a ways an means motion which adopted the budgetary policy of the government. On Tuesday, April 8, 1997 the House adopted two ways and means motions upon which Bill C-92 and Bill C-93 are based. The procedure to send a bill to committee before seconding reading allows a committee to bring forward amendments that can alter the principle of the bill and go beyond the scope of the bill. That is its purpose. There should be no other reason for the government to send a bill to committee before second reading.
I would argue that if the House adopts the budgetary policy of the government and then adopts a ways and means motion which leads to a bill, that bill cannot and should not be subject to a process that could alter the bill in such a way that it would be different from the ways and means motion. I will argue that the only process for a bill that is based on a ways and means motion is the traditional process where the bill is adopted in principle before being subject to committee study.
I Refer to Beauchesne's sixth edition, citation 983:
(1) A bill, related to a Ways and Means resolution, must be based on-the resolution.
(2) The most desirable practice is for the bill to adhere strictly to the provisions of the resolution, and departures, if any, ought to be subject to the strictest interpretation.(1150 )
Citation 984 deals specifically with the committee consideration:
If any of the provisions of the bill should be found to go beyond the Ways and Means resolutions as agreed to by the House:
(a) a further motion must be passed by the House before those provisions in the bill are considered by committee; or,
(b) the bill must be amended so as to conform to the motions to which the House has agreed.Citations 988:
Amendments must not exceed the scope, increase the amount or extend the incidence of any charge upon the public, defined by the terms of the Ways and Means resolutions, by which the provisions proposed to be amended are authorized.Citation 989:
The motion by which a tax is proposed in the House is now treated as an effective expression of the financial initiative of the Crown, and therefore, as the standard in relation to which the admissibility of amendments is determined. Accordingly, an amendment is debarred, not only from increasing the rate of a tax but also from extending its incidence to new classes.We cannot have a process that recognizes the clear precedence that the bill must stay within the narrow confines of the ways and means motion, yet subject the bill to a process whereby the government is inviting amendments that may vary the principle of the bill and by inference go beyond the scope of the ways and means motion.
If this is the case, then how can these bills be referred to committee before second reading? It does not make procedural sense to do so. It should not be allowed under our rules to do this because it is a departure from our tradition of dealing with bills based on ways and means motions and in particular a bill to implement certain provisions of the budget which is based on two ways and means motions adopted by the House.
If we consider that the general principles of these measures have been adopted by the budgetary process and the details of the principles of these measures have been adopted by a ways and means motion, then how can we proceed to consider these bills in committee before second reading when the principle of the bill has already been fixed and determined?
It is clear that these restrictions on the way bills are based on ways and means motions are dealt with disqualifies them from being considered by a committee before second reading.
The committee cannot deviate from the ways and means motions that were passed by the House, so the proper procedure is to consider these bills in a traditional manner.
It is clear to me that what the government is trying to achieve is to abuse the rules of the House in order to fast track its budget implementation bills.
Not today, Mr. Speaker. I ask you to rule that these bills and any future bills based on ways and means motions cannot be referred to committee before second reading and that the motion we are currently debating is out of order.
The Deputy Speaker: I thank the hon. member for St. Albert for his representation which he has obviously thought out carefully and has presented very precisely.
Ms. Marlene Catterall (Ottawa West, Lib.): Mr. Speaker, the member for St. Albert is arguing that Standing Order 73 should not
be applied to this bill. I think it might be helpful to recall why Standing Order 73 was adopted unanimously by the House.
It was in response to a concern among the public and parliamentarians that members of Parliament needed to have more ability to play a real role in the development of legislation and not to be constrained unduly by the government's intentions with respect to legislation. For that reason, the government did introduce into the House an amendment to the standing order allowing any bill to be referred to a committee before second reading so that the committee of ordinary members of Parliament would not be constrained by the intentions of the government in examining the issue of the bill and making the appropriate recommendations back to the House.
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As the member for St. Albert said, by referring a bill to committee before second reading, the standing order allows a parliamentary committee to look at the principle of the bill and to not be constrained in proposing amendments which are consistent with the principle. It allows those members of Parliament to examine the entire issue that the bill addresses and to go beyond the scope of the bill.
My colleague quoted Beauchesne. I would like to point out that the citations he referred to predate the adoption of Standing Order 73 and therefore are superseded by Standing Order 73.
Both the government in introducing the change to the standing orders and the House in adopting it unanimously did not in any way limit which bills could or could not be referred to a committee before second reading. That was left to the discretion of the government in proposing that a bill be referred before second reading and, more important, to the members of the House to vote on the proposal to send a bill to committee before second reading.
I do not think that citations and interpretations which were made before the House expressed its will to give members of Parliament more latitude and scope to influence legislation without restriction should supersede the views expressed by Parliament.
This whole issue of members of Parliament having more influence, particularly on matters of expenditure and taxation, was studied for over a year by the subcommittee of the Standing Committee on Procedure and House Affairs, of which I and the member for St. Albert are members. Throughout the study our discussions on Standing Order 73 concerned how to give members of Parliament more influence, in line with the wishes which we heard from Canadians. Hopefully the report of that subcommittee will be tabled before Parliament in the near future.
Frankly I am astonished that the member for St. Albert is proposing that members of Parliament and the standing committees should not have the expanded scope that Standing Order 73 intended to give them.
Finally, the committee is constrained by the will of the House, as expressed in the ways and means motion. The member should be aware of that. The committee has to act within the authority it has been given by Parliament.
What the member seems to be suggesting is that a committee, in exercising this new responsibility under Standing Order 73, should not be constrained by the directions of the House. I find his argument somewhat confusing. He says that because it is a decision of the House, the House does not have the authority to act in accordance with Standing Order 73, but if it does then the committee should not be constrained by other decisions of the House. There is a contradiction there.
However, the fundamental principle is that Standing Order 73 was adopted by the House to allow committees to have the scope to examine the principles of a bill, the scope of a bill, and to bring back its best recommendations to Parliament. Parliament will ultimately decide.
The committee of course will exercise its new responsibilities in accordance with the directions it has received from the House, including the ways and means motion.
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Mr. Jim Silye (Calgary Centre, Ref.): Mr. Speaker, I rise on the same point of order. When the hon. member who just spoke quoted Standing Order 73, she was thoroughly accurate.
The purpose of sending bills to committee prior to second reading is to give the committee an opportunity to look into a bill thoroughly and to improve it before it comes back to the House for second reading. In that way, a lot of valuable time of the House is not tied up. There is no question that that is the intent, the scope and the purpose of that standing order.
However, when you look at this bill and the other one we will be debating later today, what has to be pointed out is that the general principle of the measures contained in the budget have been adopted by the budgetary process.
The details of the principles of these measures were adopted when the ways and means motion was passed. Why is the bill being sent to committee prior to second reading when, in principle, in scope, in containment, in its content it is a fait accompli?
Puis parce que nous avons-I do not have very good French-to send it. Not to make light of this, how can we proceed to consider these bills in committee before second reading when the principle of the bill has already been fixed and determined? What is the Standing Committee on Finance going to do? What is it going to amend? What principle is it going to change? What scope is it
going to go back to? Will it spend less somewhere? Will it recommend cuts elsewhere? Will it change the amount of money, the $800 million, that is given to the foundation of innovation for science?
This is a misuse of the standing order, plain and simple. The argument that we are trying to put forward is that neither this bill nor the other bill we will be debating today, Bill C-93, should be sent to committee prior to second reading.
The very same point that the member from the Liberal Party, the former whip like myself, made about the purpose of Standing Order 73 is accurate and true. I support her when she makes that claim.
When the rules of Standing Order 73 are applied, any good lawyer-I see one sitting beside her now-will say that this is just smoke and mirrors and that the purpose of the government is to get it out of the House so that debate is limited. When it comes back the rule states that debate is limited. We do not have the number of hours to debate the bill after it comes back from committee if we send it to committee prior to second reading.
They are using a double whammy on the opposition members. It is another example of limiting the democratic rights and principles of the opposition parties. Our job here is to go through legislation, to go through ways and means motions, to decide whether it is in the best interests of the Canadian public to either support them or, if not to give them our full endorsement, then to make recommendations through amendments either here in the House, in committee or at report stage, then come back and work on them.
There was an agreement at the start of the 35th Parliament. A lot of bills come here at second reading, prior to going to committee and we make a lot of amendments. It ends up being a big waste of time. For certain legislation, for complicated bills, there are advantages in sending them to committee where the job of the committee is then to thoroughly go through the bill. Sometimes the committee has done it but sometimes it has not.
Agricultural bills have been sent to committee prior to second reading and the members in the committee just ram through clause by clause. They limit debate. We know all about the complaints we have had. They have misused their majority in committee. That is one thing.
However on this one, there will not be any debate on scope. There will not be any debate on principle. It has already been adopted. It is the law of the land. It is a done deal.
I submit very humbly that this point of order be considered, Mr. Speaker, and that you rule that this bill not be sent to committee prior to second reading for the very reasons that I have outlined. To summarize, it is unnecessary. It is just a way that the government has figured out to once again stifle and limit freedom of speech and the time that is supposed to be allocated in the giving of opinions on bills.
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This legislation will pass. We all know that. We all know how important the budget is to the nation. We all know it is necessary for the budget implementation act to pass, so money can be borrowed and that kind of thing. But what we object to is limiting the time that we can discuss the bills.
I believe this bill should not be sent to committee prior to second reading because the principle and the scope are clearly established. Nothing will be changed. It should just remain in the House for second reading.
Mr. Williams: Mr. Speaker, I would like to rebut some of the points brought forward by the government whip. She stated that Parliament should not be constrained unduly. However, because the House voted on the ways and means motion, in essence we put a circle around that bill, a very definite circle.
I would like to refer you, Mr. Speaker, to Commons Debates, page 962, dated February 7, 1994. It is about three paragraphs. It states regarding the adoption of the standing order change:
There is, however, an important additional benefit to be gained. The broad role of standing committees with regard to a bill dealt with in either of these two new processes could substantially reduce the quasi-proprietary attitude of ministers and their officials toward their legislation. By the time such a bill is ready for second or third reading, it could be as much a committee's bill as it is that of the sponsoring minister. It has been suggested that a vote on second or third reading of such a bill could as a consequence of this be more difficult to describe as standing by itself, a confidence issue. Members on all sides of the House could find themselves freed more often of constitutional implications in voting and would be able to depart from the party position without concern about defeating the government.
In other words, the suggestion has been made to me that these two new legislative routes could be one way of increasing the number of so-called free votes.
The new procedures can also help avoid situations that all governments face from time to time. They result from bills being developed within departments without sufficiently broad and open public consultation. As a consequence, things could be overlooked and governments as a result are embarrassed, to say the least, when the bill must be dramatically changed or even withdrawn in the face of a strong expression of negative public opinion after the bill has been introduced.This all points to the fact that a bill going to committee before second reading allows a process whereby major fundamental changes can be made, the principle of the bill can be changed and before the House has expressed its opinion in a vote.
In this case we have had two votes, one on the budget and one on the ways and means motion. Those in essence are first reading of this bill. The House voted and said that is it. We cannot allow this
to go to committee before second reading. This motion is out of order.
Ms. Catterall: Mr. Speaker, I do not want to belabour the point. However, since there has been a response to my comments I would like to reinforce some of them and perhaps just point out to the member from Calgary Centre that unlike him I am not a former anything.
Standing Order 73 is very clear. It is unlimited. It says ``any government bill''. I trust that Parliament knew what it was doing when it adopted Standing Order 73. It does not suggest any limitations to the principle, the scope of the bill. It makes no such references. Those are ways in which we have interpreted it in some of our debate on how Standing Order 73 might apply. But the standing order itself simply says ``any government bill may be referred before second reading''.
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The Deputy Speaker: I think I have heard enough. I thank all three members who spoke on this matter. Rather than reserve on it, I think it is important to give reasons now rather than later in the day.
I note that Standing Order 73(1) states very clearly: ``-a Minister of the Crown may, after notifying representatives of the opposition parties-'' for any government bill, as was indicated. This is pretty all inclusive. The hon. member for St. Albert has a point in that this appears to be the first time that Standing Order 73 has been used for a ways and means bill.
Standing Order 73, however, does not alter directly the practice of the limits imposed by the ways and means motion. The ways and means motion was adopted by the House and the committee, as members will appreciate, is bound by it. Anything in the bill not directly related to the ways and means motion, however, would be open to the larger scope of amendments envisioned by Standing Order 73.
I might add that it is not unusual for ways and means bills to contain matters which are outside the ways and means motion. This apparently has happened dozens of times. Those matters can be amended without reference to the terms of the ways and means motion. In that case, Standing Order 73 seems to be an applicable use and not necessarily an abuse, as was argued by the hon. member for St. Albert.
Accordingly, the Chair finds, despite a most eloquent and carefully thought out argument by the hon. member for St. Albert, that Standing Order 73 would appear to govern in this situation.
[Translation]
Mr. Osvaldo Nunez (Bourassa, BQ): Mr. Speaker, after that half-hour procedural debate on the scope of Standing Order 73, I am going to enter the discussion on Bill C-92 to amend the Income Tax Act. The purpose of this bill is to implement certain measures announced in the 1996 budget. I wonder why the government tabled this bill only yesterday, more than one year later.
To begin with, the purpose of the 1996 budget, like its predecessors, was to battle the deficit. But the losers in the battle were the provinces, the workers, the unemployed and the most marginalized members of our society. This budget pretends to reduce the deficit by taking the $5 billion surplus from the unemployment insurance fund. We can see the consequences today: the bulk of the budget problems of the Government of Quebec today are, in fact, due to the 1996 budget, as well as the 1995 and 1997 budgets.
Many of the difficult choices the Government of Quebec has to make are the consequences of the cuts in social transfers to the provinces that have been decreed by Ottawa. I must state that it is immoral for the government to use the unemployment insurance fund surplus to solve its deficit problem. These funds do not belong to the state, to the government, in any way; they belong exclusively to the workers and to the employers.
When Bill C-12 reformed the unemployment insurance system in Canada, it drastically reduced benefits, their duration, and the number of unemployed people eligible for benefits. Workers and especially the unemployed will not forget Bill C-12 when they vote in the next election.
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Neither Bill C-92 nor the budgets brought down in 1996 and 1997 contain any provisions for the kind of tax reform in this country that the Bloc Quebecois has been demanding repeatedly. The 1996 budget only went so far as to create a technical committee on business taxation, a committee whose appointees had a conflict of interest and whose members advise large corporations on how to save on their income tax. Moreover the committee's mandate, which was for a set term, has already been extended until the end of 1997.
In the next election, taxation will be a central issue. The Bloc Quebecois will talk about Canada's unfair tax system. The tax burden must be shared equitably between private citizens and corporations. There should also be a greater measure of fairness in the tax system's approach to large corporations and small businesses, because small businesses are the sector that creates jobs.
Our current tax system does not promote job creation, although unemployment is our number one problem today in Canada, Quebec, the maritimes and everywhere else. Again, we have to mention all those promises that were not kept by a government that was elected under the slogan: jobs, jobs, jobs. Today, unemployment has reached 12 per cent in Quebec and 10 per cent in Canada. The main victims are women, young people and workers around 45
or 50 years old who can no longer find work when they are laid off. Immigrants are also hit by unemployment.
Last week in Montreal, I met several leaders of the Spanish speaking community who told me that 40 per cent of the members of this community are now unemployed in Montreal, more than half of the black population in Quebec, especially Montreal, is unemployed. These people want to work. They are even prepared to take on difficult jobs, to work the night shift, to work for the minimum wage, even without employment insurance. They want to work, but the government is doing nothing to create jobs.
In my riding in Montréal-Nord, almost one third of the labour force is unemployed. People come to see me at my office and ask me to help them find a job. This is very sad, because there is almost nothing I can do to help them. Zellers, which is doing very well, announced it was closing its warehouse in Montréal-Nord, so 378 employees will lose their jobs as of July 1.
Last week, we attended a meeting called to create a committee to salvage these facilities. The meeting was attended by federal members, of course, and provincial members, representatives of the municipality of Montréal-Nord and the unions. I want to take this opportunity to ask Zellers not to close its warehouse in Montréal-Nord, an area that has a very well trained and highly skilled workforce with considerable experience in this field.
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I also take this opportunity to appeal to business to develop social responsibility. Banks, for example, which made more than $6 billion in profits last year, more than any other business sector in Canada, also lay off the largest number of employees. That is unacceptable.
Again, I think the government should introduce a bill imposing a minimum tax on corporations, and banks in particular.
The situation in Montreal, and Montreal North in particular, is extremely difficult. More and more women, children and immigrants are living in poverty. A very large share of the responsibility for this most acute problem lies with the federal government. There are 1.5 million poor children in Canada. More than 5 million Canadians and Quebecers are living under the poverty line. In Montreal North alone, about 9,000 households, or 20 per cent of the total population, rely exclusively on social assistance.
Efforts have been made these past five years to establish a CDEC. I made this a priority when I ran for office. The CDEC has been in operation since February and is doing a great job. However, the federal government will not contribute $170,000 to the Montreal North CDEC, but at the same time, older workers are no longer covered by the POWA, the Program for Older Worker Adjustment, since it was abolished on April 1.
For all these reasons, I can only find fault with this government, and all this will come out during the next election campaign.
[English]
Mr. Jay Hill (Prince George-Peace River, Ref.): Mr. Speaker, it is a pleasure for me to speak today to Bill C-92, the budget implementation act.
I note that this is an act to implement parts of the 1996 budget. It seems more than a little odd that at this late date we are debating a bill which applies to different facets which were brought in under the 1996 budget, albeit in limited fashion because of the government's choice to use a procedure which was just argued against.
What does this mean? Obviously it points to the ineptness of the present Liberal government since it has taken it approximately 15 months to bring forward this legislation. As my hon. colleagues from St. Albert and Calgary Centre pointed out during their very eloquent presentations, it is a tragic misuse of Standing Order 73. It is a way in which the government is able to circumvent the democratic process and utilize a standing order which was agreed to by all members in the House very early in this Parliament. Perhaps we were naive enough to trust the Liberals. We do not do that very often, obviously for good reasons. We trusted the government not to abuse Standing Order 73 in this fashion. We took the Liberals at their word that the intent of Standing Order 73 was to allow more input from rank and file members of Parliament.
Mr. Campbell: Mr. Speaker, on a point of order. I am sorry to interrupt the hon. member. I know it is disconcerting to have that happen. I believe the Speaker has ruled on this issue and the hon. member in the context of his comments in debate on the motion has returned to a matter on which the Speaker has just ruled, against the position the member is advancing.
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The Acting Speaker (Mr. Milliken): I know the hon. member was making comments about the tenor of the debate. I did not think he was reflecting on the ruling of the Chair. I think the hon. member knows it would be improper for him to do so. Bearing that in mind, I am sure he will continue with his comments.
Mr. Hill (Prince George-Peace River): Mr. Speaker, since I did not opt to rise, as a number of members of Parliament did, to take the time of the House during that point of order, I thought it was within the purview of my presentation to at least point out that you are quite right, Mr. Speaker, I was not challenging the decision made by the Chair, nor would it be appropriate for me to do so.
What I was clearly pointing out is the misuse by the government of this standing order, not the decision arrived at by the Chair.
The Acting Speaker (Mr. Milliken): The hon. member will want to be careful because the Chair has ruled that the procedure being adopted is correct in accordance with the rules. I invite him to be temperate in his remarks in discussing this issue. There has been a ruling from the Chair and I know he respects that. I invite him to perhaps address another subject. It might be safer.
Mr. Hill (Prince George-Peace River): Mr. Speaker, I was merely pointing out that I believed this standing order is broad enough and loose enough that potentially some abuse can exist. That was the point I was trying to make.
Earlier in debate the hon. member for Scarborough-Rouge River attacked Reformers, saying that we were misrepresenting the facts on how this government is moving toward a balanced budget. I believe the Canadian public is coming to realize that how the Liberal government is moving toward a balanced budget is on the backs of taxpayers.
Tax revenue has increased in the neighbourhood of $24 billion a year. There is a proliferation of user fees for various things that used to be provided for Canadian citizens. There is the downloading of approximately $7.5 billion to the provinces in reduced transfers through the Canadian health and social transfer. The government has been enjoying the lowest interest rates on the national debt in four decades.
If taxpayers and voters really analyze who is responsible for gradually bringing the budget into line they will recognize that they are. They are the ones who are paying and making the advances that have come.
It really galls me to no end when I hear government members saying it is because of the growth in the economy. Who has ever said that if we as a nation enjoy some growth in the economy big government should benefit by just taking more out of the economy to spend as it sees fit? It is the principle of the matter and I have great difficulty believing that principle is supported by the majority of Canadians.
This bill deals with a range of subjects, tax credits for individuals, child care expense deduction, deferred income plans, foreign reporting rules whereby people with assets overseas will have to report not only the income derived from those assets but the assets themselves to the government. It deals with a wide range of issues.
Earlier the member for Scarborough-Rouge River said Reform is not accurately representing the facts on the budget and the whole issue of bracket creep. People have asked me ``who is this bracket creep and what crime has he committed?'' They are really interested. They hear about this bracket creep and they wonder where they should direct their attention.
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To try to explain it as simply as possible, bracket creep is what happens to a taxpayer in a certain income tax bracket who, because the government has failed to index income tax to inflation, finds himself moved up into another bracket.
Mr. Fewchuk: That is the guy from Calgary.
Mr. Hill (Prince George-Peace River): The hon. member opposite is suggesting that it is only millionaires who experience this. It is quite the contrary. This is falling on the already horribly overtaxed middle class of Canada.
It is interesting to note what was said by some government members about bracket creep when they were in opposition. I remind those members of what they said by quoting from Hansard.
Who do we suppose said the following? This individual was referring to the Tory finance minister, Michael Wilson:
He said lower taxes. He told us there were no tax increases in this budget. That statement is false because taxes are going up in this country because of the deindexation of deductions which this government has done in its past budgets. The government knows it is going to get more money this year as a result of the removal of the indexation provisions on all deductions in the Income Tax Act and the removal of indexation on the rates of tax on various levels of income. Those have all been taken out so taxes will go up this year.That is a quote from Hansard of April 28, 1993. I am sure the House will recall that individual, the Liberal member of Parliament for Kingston and the Islands. It was you, Mr. Speaker. Back in 1993 you recognized that bracket creep was a sneaky way in which governments, at the time the Tory government, could increase taxation on the already-
Ms. Catterall: Mr. Speaker, I rise on a point of order. I am extremely concerned about the direction the debate has taken. There were approximately 84 Liberal members of Parliament in the last Parliament, any one of whom could be quoted.
I trust the member is not trying to drag the Speaker off his neutral throne at the head of this Chamber and into this debate, but I am afraid that is the effect his comments are having. I would ask you to rule on whether he may in fact quote the Speaker who is now occupying the chair as part of his debate.
The Acting Speaker (Mr. Milliken): I appreciate the kind words of the deputy government whip but I am always pleased to be quoted.
The hon. member has a few seconds left for his remarks. I would appreciate it if he could conclude quickly as his time has expired.
Mr. Hill (Prince George-Peace River): Mr. Speaker, I was merely referring to the fact that back in 1993 you recognized this as a form of increase in taxes. I was merely applauding your insight.
What Canadians are telling us today is clear. It is Liberal-Tory, same old story, when it comes to taxing, taxing, taxing.
The Acting Speaker (Mr. Milliken): I thank the hon. member. I appreciate the new term bracket creep, which I do not recall using and do not recall hearing before. It was a delight to hear it.
[Translation]
Resuming debate. The hon. member for Saint-Jean.
Mr. Bachand: Mr. Speaker, I would like to speak-
The Acting Speaker (Mr. Milliken): I am sorry. It is the other party's turn to have the floor.
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Mr. Claude Bachand (Saint-Jean, BQ): Mr. Speaker, I thank you for being absolutely neutral, as you have just shown us.
I am pleased to address Bill C-92 which, as we know, is a ways and means procedure to implement certain measures announced in the 1996 budget. That 1996 budget was yet another opportunity missed by the government to put its fiscal house in order and to make things somewhat more equitable.
That budget was yet another missed opportunity by the government to review the corporate tax system. In order to put things off for a while and to make sure that corporate taxation would not be reviewed too soon, the 1996 budget provided for the creation of a technical committee. However, we recently learned that the mandate of this technical committee is now being extended until the end of 1997. Once again, the government is playing it safe, given the upcoming election campaign.
As the official opposition, we have a duty to point out these things, and we will definitely do so during the election campaign.
What did the government do to postpone this tax review and to make sure things remain unfair, as they currently are? It set up a technical committee. That committee is made up of people from the top consulting firms, people who are in the know and who try to make sure large corporations do not pay their fair share of taxes.
I consider that a bit like putting the fox-or Colonel Sanders-in charge of the henhouse. The chickens, that is the people footing the bill, are told ``No problem, chickens, we have everything under control. The good old Colonel will look after everything''.
But we have a major problem with that. The people advising the minister, advising the government, are just about in a conflict of interest situation. They will not be able to come up with solutions which might put their own clients in an awkward position.
We understand that this is a stalling tactic, to ensure that the tax contribution by the major corporations is not looked at too soon. In this connection, my hon. colleague for Bourassa referred to the situation with the banks, which I feel has become scandalous. At the present time, bank profits are in the billions. Yet they are rushing to lay off as many bank employees as they can. There are virtually no measures proposed to reform the taxation system, to get these banks to pay a bit more of their fair share.
And what is the situation in the meantime? The ones who are getting richer in Canada are the bankers; the ones who are getting poorer are the middle class. Everyone is contributing to support the state except the major corporations, which are making a small contribution, but far from enough.
Another thing that is in the 1996 budget which Ways and Means will focus on is the venture capital corporations. This is another example of Quebec's distinctiveness. Unions such as the CSN with its action fund and the FTQ with its solidarity fund make it possible for people to invest a little more venture capital. This was a first of its kind when it started up.
The central labour bodies said: ``We are going to get together with people, with workers who want to put money in a pension plan for their retirement and arrange it so that we can provide venture capital and maintain jobs''. Often, when companies are short of cash, the solidarity fund or the CSN action fund will provide assistance, helping not only to create jobs but often to maintain them.
So what did the government do? In 1996, the government decided to reduce the tax credit it had introduced which had been an incentive for workers to put money into the solidarity fund because they would get a more substantial tax refund. Probably when the government saw this incentive was too successful-not as successful as the banks, but they did not touch the banks, they hit the labour-sponsored venture capital corporations-the government decided to reduce the tax refund, which meant reducing the tax credit. Furthermore, there would be a ceiling on the amounts people are allowed to pay into these funds.
I think that was a pretty low blow, because we had workers and employers who were encouraging the public to do something socially responsible with their money, to use the money as a lever to create and maintain jobs.
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Of course the government made cuts all over the place, and I think this is deplorable. As usual, when decisions like that are made, it seems that Quebec is hardest hit because 50 per cent of the money in these venture capital corporations in Canada comes from
Quebec. In other words, the government missed an opportunity to let this type of fund expand. It would been far better, as I see it, to set up a committee that would really do something about making the system more equitable as well as doing something about those who have all the capital, in other words, the banks.
Another ways and means motion about to be implemented is the unemployment insurance fund heist. You will recall that in 1996, the fund had a surplus of $5 billion. Employers and employees make a contribution. Studies show that each time the contribution is reduced by 10 cents, up to 30,000 jobs can be created. It was maintained and artificially raised over the years.
Naturally the minister decided this year to lower it by 10 cents. Will he create 30,000 jobs? I think so. But he had plenty of room to lower it much more than that and yet he did not. Why? Because he is taking the surplus from the unemployment insurance fund and paying off the deficit with that. Who is bearing the cost? Workers and employers, as I said.
Finally, it almost amounts to an indirect tax, and the government is benefiting from it. Why is it benefiting? Not just because the employers and employees are paying, but also because it is tightening eligibility requirements and ensuring it is making people poorer and hustling them along to the welfare rolls. That is what is happening.
If we look at the statistics since the Liberals formed the government, the number of unemployed in Canada declined from 1.6 million to 1.5 million. The 100,000 no longer receiving unemployment insurance have probably thrown themselves into the clutches of welfare, which is under Quebec's jurisdiction.
And so, on the subject of the unemployment insurance fund, it is totally deplorable that the government is not settling the matter by ensuring further improvements to the system and using the money to try to create jobs. It is not necessarily a question of giving the money to the unemployed, but some effort must be made to create jobs. But the government is not trying to create jobs; instead, it is using the surplus to pay off its deficit.
In terms of the unfair tax system, the same thing is true. I talked about it to some extent earlier, but we can also talk about family trusts. There are also large corporations that do not pay tax. When asked when it intended to be pay its overdue taxes, which it used to defer, Consolidated Bathurst replied: ``Never''.
I suggest that the taxpayers who are working on their income tax returns write on those returns that they never intend to pay the money they owe the government. I suspect Revenue Canada will get back to them in a jiffy and say: ``Look, you must pay your taxes and they are overdue. There is a penalty for not paying and you will be charged interest on top of that''. But justice does not mean the same thing, depending on whether you are a large corporation or a middle or low income taxpayer.
Family trusts are another case in point. The government never managed to settle this issue. There is some mention, in a ways and means motion, of a possible deferral over time that would shorten the length of time, but what does this mean for family trust owners? It means transfers. Family trusts are still there to transfer. They are transferred free of tax, benefiting once again rich financiers. The poor and the middle class cannot afford to establish family trusts for their young children.
This is unfair all the way. There is also the $7 billion in federal expenditures that has been shovelled in the provinces' back yard with the last two budgets. What this government should do is listen to what the Bloc Quebecois is proposing to settle the personal versus corporate income tax issue. This is $7 billion that can be recovered.
Unfortunately, the government is not listening to what we are saying, but we will make a point of bringing this up during the election campaign. This will all be settled in the next federal election. In Quebec, the voters will send a clear message to the Liberal government, which has strayed off course, and this will all be settled in the polling booth on June 2 or 9, probably.
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[English]
Ms. Marlene Catterall (Ottawa West, Lib.): Mr. Speaker, I was very pleased to hear the Reform Party member who spoke last acknowledge that Canadians are responsible for the very positive gains that have been made in terms of putting the economy of the country on a sound footing.
That is something that members of our caucus, our cabinet ministers, recognize very strongly. The Prime Minister has spoken about it. The finance minister has spoken about it.
They are the considerable sacrifices that Canadians have been asked to make and the understanding we have had to seek from them for some of the program cuts made over the last few years to bring our deficit, finally, from over $42 billion down to under $20 billion, heading to under $10 billion for next year.
The member spoke about growth in the economy and somehow seemed to think it a sin that with growth in the economy the government would be collecting more taxes. It is quite obvious that if there are a larger number of Canadians who are working, and there are close to a million more Canadians working now than were working three and a half years ago, more people earning, clearly
there will be more people contributing to the cost of running the country and delivering the programs that Canadians value.
The member should also ask himself why we have enjoyed the growth in the economy that he has acknowledged. He talked as though lower interest rates are something the government should apologize for. We do not.
Those lower interest rates have contributed tremendously to the growth in the economy that the nation is enjoying. It is because of the good fiscal management that this country has had for the last three years since the October 1993 election.
I want to acknowledge that the Reform Party did, in the last speech, speak about the growth in the economy. We appreciate those comments about low interest rates.
One of the items in the bill before the House today is the taxation treatment of child support. This bill changes the taxation of child support. The change is part of a larger package of reforms to deal with child support. The reforms include measures to try to address the problems of inconsistent child support payments, inadequate child support payments, support payments that often are not paid at all, intermittently or inadequately.
The three reforms include the introduction of the federal child support guidelines to establish fair and consistent support awards in divorce cases. In addition, there is the enhancement of federal and provincial enforcement measures so that those awards decided by the courts would be paid. Finally, the item this bill deals with primarily, there is a change in the way that child support awards are taxed.
Let me take a few minutes to explain how we have changed the rules and why. Traditionally support awards have been tax deductible to the paying parent and taxable as income for the parent receiving the payment, i.e., the custodial parent who also has the responsibility for the day to day care of the children.
The 1996 budget announced that this system would be replaced with a system of no deduction, no inclusion. Perhaps some members need to be reminded that this is in line with the court decision delivered not that long ago that the practice of allowing the parent paying child support payments to deduct the payments before paying income tax and having the parent receiving it pay the tax on that amount was unconstitutional and contrary to the charter of rights and freedoms.
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To suggest that the government should not somehow be dealing with that and correct a provision in tax law that is contrary to the charter and to the Constitution of this country goes a bit beyond the ridiculous.
That is what we are trying to do. The court simply said that if we have two parents, both of whom are supporting their children, if one is still married to the other parent, they pay tax on that money, but if one is divorced from the other parent, they pay no tax on that money. That is discriminatory between parents who are married and parents who are not married. Quite simply that is the issue we are trying to address here.
In theory the old system could deliver a tax benefit that would make more money available to the children. That is because the paying parent usually had a higher income than the recipient or custodial parent and therefore was taxed at a higher marginal rate. If the paying parent saved money, that saving could in theory be passed along to the children.
In practice that is not what happened. The system failed to deliver this benefit and actually made it harder to set fair and realistic awards in the courts. The system was fraught with a host of frustrations that were reflected in the well known case of Suzanne Thibaudeau, which I have just referred to.
For one thing, the tax benefit was not targeted to reach children who needed it most, and complex tax calculations made it more difficult for parents to negotiate a realistic level of support that they both saw as fair. Many parents also found that waiting until year's end to receive a refund or to make lump sum payments created serious cash flow problems for both parents.
This package of reforms we have made including the tax measures in this bill is the result of a supreme court decision but also the result of cross-country consultations held under the auspices of my colleague, the member for Mount Royal, in which we heard the real life experiences of families that had broken up, what was happening to children, what was happening to their parents and the real poverty created by the existing system.
The Vanier Institute's last report found that two-thirds of women whose marriage breaks up walk out of the marriage and into poverty. That means their children walk with them. That is part of what we are trying to address by these reforms. It is part of the reason for this change in tax policy with respect to taxation of child support payments. It is a measure that is legally necessary but it is also necessary in justice and in fairness and putting the concerns of our children and their well-being first.
Mr. John Williams (St. Albert, Ref.): Mr. Speaker, normally I stand up to say that I am pleased to join in the debate on Bill C-92, but you did hear the point of order I raised earlier and the fact that Standing Order 73(1) has now become a time allocation standing order rather than a standing order that has real meaning. If we followed through with the real moral intent of the standing order we would never be having this time allocation today.
I know the Speaker has ruled, not in our favour and we do not feel he ruled in favour of the people of Canada, but certainly on a narrow interpretation-
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The Acting Speaker (Mr. Milliken): I hesitate to interrupt the hon. member, but he knows it would be improper to reflect on a ruling of the Chair. I thought he was moving off that subject, quite smartly, as I had sort of cautioned him to do. I invite him to move off the subject immediately. I think it would be unwise to continue this line.
Mr. Williams: Mr. Speaker, Bill C-92 deals with a budget measure of 1996. It is now April 10, 1997, 14 months since that budget was tabled. The legislation is just now being introduced.
I have a couple of children, one attending university. I saw that I was getting an extra deduction for his education. It has gone from $60 a month for full time attendance at university to $100 a month for full time attendance. I thought it was not bad, but I wondered when it went through. It is going through today. Here it is. Now we know why the government is in such a rush. It is here in Bill C-92 after I did my income tax. After millions of Canadians have done their income tax we now find that the legislation is coming along like the tortoise after the hare. Unlike the tortoise, it does finish first and causes the income tax returns to fall into line, if I may say.
Going through the summary of the act, it is complex and detailed. There are tax credits for individuals, charitable donations, child care expense deductions, child support payments, deferred income plans, foreign reporting rules, non-resident pensioners, all by and large things that are somewhat beneficial to individual taxpayers.
Then I read on, scientific research and experimental development. It introduces a salary cap for SR and ED treatment of salaries of specified employees. This is a tax limitation on a tax break that corporations can get.
No. 9, labour sponsored ventured capital corporations. It reduces the tax credit rate from 20 per cent of the cost of the LSVCC share to 15 per cent, another restriction on tax breaks for corporations.
No. 10, flow through shares. It extends the look back rule to allow qualified expenses incurred at any time in taxation year to be treated as if they were incurred in the preceding years, again a reduction in benefit.
No. 11, resources losses requires an add back to income or 25 per cent of prescribed resource losses, another one that increases the tax liability of corporations.
No. 12, Canadian field processing excludes gas plant processing from activities eligible for the manufacture and processing tax credit, another situation where businesses will pay more tax.
No.13, joint exploration corporations, repeals rules allowing for the renunciation of resource expenses by joint exploration corporation, another situation where corporations will pay more tax.
No. 14, part 6 capital tax, extends the application of additional part 6 tax by one year for banks and other deposit taking institutions and by three years for life insurance corporations, another extension of a tax on corporations.
The minister stood up and said he has not raised taxes. Right here is Bill C-92, coming from the budget of February 1996. Fourteen months later we now have the legislation in front of us. There it is, tax increase, tax increase, everywhere business turns there is a tax increase, all the while the government throws a few shekels to individuals. The government seems to think that there is no limit to how big business can pay more tax.
That is despicable. Who creates the jobs in this country? Business of course. How can business create jobs if they are being taxed into oblivion? That is what the government is doing. It is taxing business into oblivion.
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The employment insurance program is turning out to be nothing but a blatant tax grab by the government. According to the latest numbers I saw in the ``Fiscal Monitor'', the government will run a surplus on employment insurance premiums that exceed benefits paid out under employment insurance by approximately $7.5 billion. That is a $7.5 billion surplus in one year.
The government has dramatically cut back the eligibility of individuals for employment insurance. It has cut back the amount of employment insurance it pays to individuals who manage to qualify. It has made a pitifully small decrease in the amount of premiums paid by individuals and employers. In the course of doing all that up comes the surplus. As more money is coming in and less money is going out, away the surplus goes. The Minister of Finance is taxing business to the point that it cannot create jobs. Then he stands in the House and says that unemployment is still over 9 per cent and he wishes it were coming down. He does not know why it is not coming down. Let me tell him.
If he looks at Bill C-92 he will find out why the unemployment rate is not coming down. There are extra taxes for business under the scientific research and experimental development program, extra taxes for business under labour sponsored venture capital corporations, extra taxes on flow through shares, extra taxes on resource losses, extra taxes on Canadian field processing, extra taxes on joint exploration corporations and an extension of the capital tax for banks and insurance companies. We cannot have our cake and eat it too. That has basically been the rule with Standing Order 73 excepted.
The Minister of Finance thinks he can tax these businesses into the ground and then turn around and say it is their responsibility to create all these jobs. It is time the minister had a few economic lessons from somebody. It just does not work that way.
Let us look at the benefits he has given to individuals. He has made changes to the child care expense. People can now claim child care expenses for people aged 16. We throw young people into young offender institutions long before they are 16. I wonder if that would qualify for a child care deduction. It is an interesting thought: a 16-year-old going off to day care with a lunch bucket in his hand and holding his mommy's hand too. I can see it now.
The government is going too far in thinking it can buy votes from individuals and in taxing businesses into oblivion. I will leave it at that.
[Translation]
Mr. Benoît Sauvageau (Terrebonne, BQ): Mr. Speaker, before discussing the ways and means motion on the previous budget, I would like to take a minute to thank some people from the new riding of Repentigny.
You referred to me as the member for Terrebonne but, after June 2, that is after the next election, the Speaker who will be in the Chair, and I hope it will be you, will have to refer to me, assuming I am re-elected-but I am not overly concerned about this, since things are going very well in our riding-as the member for Repentigny, the first one to represent this new riding.
In a few years, if things go well, I will have become the first and last member for Repentigny, because that riding will not have a very long life. It will go through only three stages: first, the election of the Bloc Quebecois; second, the election of the Parti Quebecois; and third, the holding of a successful referendum. It will be a tie-breaker after the dead heat we had the last time. Therefore, the riding of Repentigny will exist for only a few years.
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My nomination meeting was held yesterday evening, in Charlemagne, one of the municipalities in that beautiful riding. On that occasion, people expressed their confidence in me by agreeing to let me represent them at the next election, as a Bloc Quebecois member. Therefore, I sincerely thank the people of Repentigny, Charlemagne, Lachenaie, Mascouche and La Plaine, for their support in the past three and a half years, and for their renewed support last night in Charlemagne. Over 150 people were in attendance and showed they are eager to get on with the next election campaign.
Some hon. members: Hear, hear.
Mr. Sauvageau: Now we are going to get to the heart of the matter, the ways and means motion for last year's budget.
I would like to quote from a book that I am sure you all read regularly a few years back, and that you were only too keen to forget about once we had read it too. I am talking about the red book. We are still waiting for the second volume, the one on promises kept, which will perhaps be as thick as this piece of paper. I would therefore like to quote from the red book. I will read what my friends across the way said on page 13:
Today, after nine years of Conservative government, Canadians are facing hardship: 1.6 million unemployed, millions more on welfare, a million children living below the poverty line, record numbers of bankruptcies and plant closings.I repeat, this appears on page 13 of the red book.
What has become of the fine words of the Liberal Party, of the compassion that we read about in the red book, but that never actually materialized, because in concrete terms we have seen nothing? What have they done after three years? We will give figures, but not the Bloc Quebecois's figures, because as our friends across the way tell us, the nasty separatists tend to play around with figures. We will therefore give figures provided by Statistics Canada, Industry Canada and Human Resources Development Canada.
So, instead of the 1.6 million unemployed Canadians they complained about in the red book in 1993, there are now, according to Statistics Canada, 1.5 million Canadians without jobs. In 1993, they wrote about ``millions more on welfare'', but Statistics Canada tells us there are now 3 million Canadians in this situation.
Instead of ``a million children living below the poverty line'', as they told us in 1993, Statistics Canada reports that there are now 1.5 million such children, 500,000 more than before.
In 1993 they wrote in the red book about ``record numbers of [-]plant closings''-they did not give a figure because it was not true-while today Statistics Canada tells us there were a record 86,253 bankruptcies declared between January and November 1996.
Before speaking about the budget, it is very important to remember the compassion expressed by the Liberals in 1993, and the failure of the Liberals to take action since that time. The figures in the finance minister's budget can be interpreted any number of ways, as the secretary of state just demonstrated, and as other government members have shown, in trying to praise this government and cover up mistakes in the budgets and this government's failure to act or its blunders when it did.
We could also go on about a number of things, a number of critical sectors of our economy, our society, our culture, our history and our trade. I believe that the most important figures, the ones that will really make the public sit up and take notice in the next
election are these: the unemployment rate, the poverty rate, and the bankruptcy rate.
Before having a firm political ideology, before having intentions, projects, hopes, we need a bare minimum, that is to say enough money to realize our ideology, or enough money to realize our hopes and dreams for the future.
With a record as pitiful as 3 million people on welfare, 1.5 million children living below the poverty level, according to Statistics Canada, I do not believe the Liberals can pat themselves on the back and boast ``We are proud of our performance record. We can present you with a budget and describe it as having successfully bolstered the social and economic fabric of this country''. This is false, and who says so? Not us, but-I repeat-Statistics Canada, Industry Canada and Human Resources Development Canada.
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The government could, perhaps-and I suggest it do so, as it has in other sectors-tell us that the head of Statistics Canada must be wrong, that he ought to be sacked, that someone new should be hired who could change the figures. We know that is a Liberal tactic. They would put a good Liberal in charge, a few figures would get changed, and then something more attractive could be reported.
Unfortunately for the Liberal Party, and fortunately for us and the man or woman in charge of Statistics Canada-I do not know which it is-this tendency, or way of doing things, from the past is no longer in use. The chief statistician and the heads of the other departments I mentioned will be able to stay put and keep giving the real figures, the results of this government's failure to act.
As I said before, the government has nothing to be proud of in this respect, and I think it has an obligation to explain these results to the public. Meanwhile, what was the Bloc Quebecois doing? Was the Bloc Quebecois, as an opposition party, shooting down everything that moved? In a way yes, but in another way no.
Yes, the Bloc Quebecois objected to various bills that were introduced and that, in our opinion, were skewed towards these figures. But at the same time, the Bloc Quebecois made certain proposals. We offered both negative and constructive criticism. So what did we propose? We proposed a plan for corporate tax reform and another one for personal tax reform.
In the new riding of Repentigny, if the Minister of Finance bothered to listen to us and realized that the proposals made by three excellent researchers of the Bloc Quebecois, not the slew of researchers that can be found at the Department of Finance, if he bothered to consider and implement the recommendations we made, he would realize that what is needed is not new money or an increase in the deficit. By reallocating amounts that are already in the tax system, an average family-for instance, a Repentigny family of two adults and two children with an average income of $40,000, these are not wealthy people, this is an average, modest income-if the Minister of Finance were to implement the proposals of the Bloc Quebecois, this average family in Repentigny would pay $821 less in income tax. This proposal would affect more than 50 per cent of the families in my riding.
Unfortunately, this family will have to pay $820 more in income tax because of poor decision making by the Minister of Finance. It may not be a lot, but for the average family with a modest income of $40,000, this is a lot money that could be funnelled back into the economy and could create real jobs.
However, the Minister of Finance has trouble going along with proposals made by an opposition party, a party that objects when something does not make sense, but also makes suggestions on how things should be changed in the interest of fairness.
[English]
Mr. Williams: Mr. Speaker, I rise on a point of order. Is the order of debate from the Bloc to the Liberal Party and then back to us under this order? Should a Reform member not be the next speaker?
The Acting Speaker (Mr. Milliken): The last speaker before the hon. member for Terrebonne spoke was the hon. member for St. Albert.
The rotation today has been from the beginning I am advised- and I was not here at the beginning of the debate-Liberal, Reform, Bloc. That is the way it has been going. It is now a Liberal's turn. Accordingly I recognize the hon. member for Haldimand-Norfolk.
Mr. Bob Speller (Haldimand-Norfolk, Lib.): Mr. Speaker, it gives me great pleasure to say a few words on Bill C-92. I know I only have a couple of minutes to speak to the budget. It is a budget that I think is notable.
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I want to say a little bit about rural Canada and the impact this budget has in the rural areas. Rural Canada is an area that has really been recognized for the first time in a budget by a government that directly looked at solving some of its problems.
In the speech from the throne the government made a commitment to look at rural Canada and to try to make sure that it shares in the economic growth that is happening across the country. I would like to thank all our members from the rural caucus in the Liberal Party and the Minister of Finance for taking the opportunity, after listening to our concerns, to address some of the concerns that we have in rural areas so that we too can share in the economic growth in the country.
I want to highlight a few areas that the minister has touched on. One of those areas deals with the Farm Credit Corporation. He
made sure that the Farm Credit Corporation had more money in which to invest in rural areas.
The trade statistics show that agricultural exports have increased some 30 per cent over the last three years. We seem to be booming in exporting our products. One of the areas in which we need to do more is to make sure that the further processing of goods, especially in the agricultural area, can get to the export market. In order to do that the farmers, who have a lot of really good ideas, need some cash to invest in these products and to get them into the market.
On the one hand the Minister for International Trade has done a good job in getting the information out to these small businesses, these farmers, and to make sure that they are represented in our embassies around the world and that their product is there.
On the other hand, the Minister of Finance has made sure that cash is there. He has made sure that the Farm Credit Corporation has cash available to help invest in these small industries to make sure that they can get up, get running and get these further processed goods exported around the world. I want to thank him for that.
I would like to highlight a point that the hon. member for Parry Sound-Muskoka was pushing very strongly and I know the Minister of Finance thanked him for that, and that is the whole of tourism and the importance of tourism to job creation in Canada. The rural areas have a lot to show. A lot of tourists come to the rural areas but there is not as much co-ordination and there are not the groups in place to help co-ordinate a tour group or a tourist who comes in to certain parts of Canada.
The Minister of Finance in his wisdom and the cabinet agreed to put some money into tourism. I know all hon. members will agree it does a lot in helping to create jobs, especially in small tourist operations in rural and remote Canada.
Obviously education and health care were in the budget. These areas are important for rural Canada. I want to thank the minister for investing in the Internet and making sure that we in the rural areas are up to speed so to speak in having access to the Internet.
In fact our young people and our students can now in any community with a population of over 400 have access to the Internet. That is a very important initiative of this government that really helps in making sure that people in rural and remote Canada can get into the new technologies that I think are going to be important in rural areas in terms of job creation.
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It is also important to note this. I want to talk personally about my riding of Haldimand-Norfolk and the importance of taxation. In my nine years here, it seems that every year, the Minister of Finance has come up and once again increased the taxes on tobacco.
I want to thank him from my constituents' point of view for not raising the taxes on tobacco in the budget. As members know, to tobacco farmers in the community surrounding my area, the size of tax on tobacco is important, although not on the sales. It does not have a big influence in the production, but in giving them a good feeling and understanding of how the system works.
[Translation]
The Acting Speaker (Mr. Milliken): It is my duty to interrupt proceedings now to put the question now before the House.
[English]
Is it the pleasure of the House to adopt the motion?
Some hon. members: Agreed.
Some hon. members: No.
The Acting Speaker (Mr. Milliken): All those in favour of the motion will please say yea.
Some hon. members: Yea.
The Acting Speaker (Mr. Milliken): All those opposed will please say nay.
Some hon. members: Nay.
The Acting Speaker (Mr. Milliken): In my opinion the yeas have it.
And more than five members having risen:
The Acting Speaker (Mr. Milliken): Call in the members.
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[Translation]
Before the taking of the vote:
The Acting Speaker (Mr. Milliken): The member for Joliette on a point of order.
Mr. Laurin: Mr. Speaker, as the bells started sounding, the official opposition asked that the vote on Motion No. 92 be deferred, and the Chair did not recognize our request at that point.
I would submit, with all due respect, to your attention, Standing Order 73(1)(d), which provides in French:
-after not more than 180 minutes of debate, the Speaker shall interrupt the debate and the question shall be put and decided without further debate.In our opinion, putting the question does not mean we cannot defer the vote. Standing Order 45(5)(a)(ii) provides:
(ii) During the sounding of the bells, either the Chief Government Whip or the Chief Opposition Whip may ask the Speaker to defer the division.
This is what we did. Nothing in this Standing Order either indicates that we cannot ask to have the vote deferred to another
time. The French text is clear, and I would ask you to recognize the request of the official opposition, please.
[English]
Mr. Chuck Strahl (Fraser Valley East, Ref.): Mr. Speaker, I rise on the same point of order. It appears the whip of the Official Opposition is correct in his summary.
I bring to the attention of the Chair that there are other times, for example in Private Members' Business, where a set amount of time is allocated for debate, at which time the question is put and is often deferred. I think in this case the whip of the Official Opposition is correct.
Mr. Bob Kilger (Stormont-Dundas, Lib.): Mr. Speaker, I would submit respectfully that the standing orders are quite clear:
After not more than 180 minutes of debate the Speaker shall interrupt the debate and the question shall be put and decided without further debate.(1345)
[Translation]
In fact, debate was concluded after 180 minutes, the vote was scheduled, the division bells were rung for 15 minutes ago. We are now ready to vote.
[English]
Mr. John Williams (St. Albert, Ref.): Mr. Speaker, I would refer to the Chair's ruling earlier this morning on 73(1) where it was pointed out by the government whip that there was no restriction in Standing Order 73(1) and therefore it applies to bills that had a ways and means motion preceding it because there was nothing in 73(1) that contained that restriction.
I draw your attention to Standing Order 45, content contains no restriction. Therefore I humbly suggest you see that his point of order is in order.
[Translation]
The Acting Speaker (Mr. Milliken): I thank members of both sides of this House for their arguments on this point. I have looked at Standing Order 76, cited by the hon. member for Joliette, and considered the wording. Furthermore, I looked at the wording of Standing Order 45 to make a comparison, and I do not believe the
[English]
It is provided in Standing Order 45(3) that:
When, under the provisions of any Standing Order or other Order of the House, the Speaker has interrupted any proceeding for the purpose of putting forthwith the question on any business then before the House, the bells to call in the Members shall be sounded for not more than fifteen minutes.I interrupted the proceedings at the conclusion of 180 minutes.
[Translation]
-in order to put the question immediately on a matter under discussion in the House, the division bells must have rung for fifteen minutes at most.
[English]
Having done so, I refer the hon. member for Joliette and the Reform Party whip to Standing Order 45(5)(a)(i):
Except as provided in sections (3) and (6) of this Standing Order-In other words, where section (3) applies there is no right to defer under Standing Order 45(5). Standing Order 45(5) applies to 30 minute bells, not 15 minute bells. On any 15 minute bell the only hope for deferral lies under Standing Order 45(7).
I urge hon. members to have regard to that fact. I did not permit the deferral of the division because I believed it was out of order and I so ruled.
We will now proceed with the question.
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[Translation]
(The House divided on the motion, which was agreed to on the following division:)
Mills (Broadview-Greenwood)
Minna
Mitchell
Murphy
Murray
Pagtakhan
Parrish
Patry
Peters
Peterson
Phinney
Pickard (Essex-Kent)
Pillitteri
Proud
Regan
Richardson
Rideout
Robichaud
Rock
Scott (Fredericton-York-Sunbury)
Serré
Sheridan
Simmons
Speller
St. Denis
Steckle
Stewart (Northumberland)
Szabo
Telegdi
Terrana
Thalheimer
Torsney
Ur
Valeri
Vanclief
Volpe
Wells
Whelan
Wood
Young
Zed-115
The Acting Speaker (Mr. Milliken): I declare the motion carried. Accordingly, the bill is referred to the Standing Committee on Finance.
(Motion agreed to, and bill referred to a committee.)
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[English]
April 9, 1997-The Minister of Finance-Second reading and referrence to the Standing Committee on Finance of Bill C-93, an act to implement certain provisions of the budget tabled in Parliament on February 18, 1997.Hon. Paul Martin (Minister of Finance, Lib.) moved that Bill C-93, an act to implement certain provisions of the budget tabled in Parliament on February 18, 1997, be referred forthwith to the Standing Committee on Finance.
Mr. Kilger: Mr. Speaker, I wonder if there might be a disposition either to suspend the House or to see the clock as being two o'clock and we could go to Statements by Members in order for the member to have his full ten minutes following question period.
The Acting Speaker (Mr. Milliken): Is that agreed?
Some hon. members: Agreed.