It’s a real pleasure to stand before you again – among friends, among colleagues, among partners in building a better Canada. This is the fourth time in six years that I’ve had the chance to address the FCM – and I’ve just got to say that in many ways, coming here feels like coming home.

June 05, 2005
St. John's, Newfoundland and Labrador

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It’s a real pleasure to stand before you again – among friends, among colleagues, among partners in building a better Canada. This is the fourth time in six years that I’ve had the chance to address the FCM – and I’ve just got to say that in many ways, coming here feels like coming home.

I want to talk to you about our New Deal for cities and communities. Now – this is a subject you know plenty about. But what I’d like to do today is discuss the New Deal in the larger context of how it fits within the government’s overall plan. I really like you all – despite the fact you got me fired as finance minister – but the New Deal is not about pleasing anybody. Rather, it is fundamental to the future prosperity not only of our municipalities, but of our nation.

Let me begin by briefly considering two of the sweeping changes that we are undergoing as a world and as a country – changes that have real implications for all orders of government.

What’s been talked about for decades is now well underway – the global economy is coming to be dominated by giants: the United States, Europe and now the emerging powerhouses of Asia. For many of the established, industrial nations of the world, the rise of China and India is a double-edged sword of promise and predicament. For Canada, with our small domestic market and our export capacity, I believe it places within our grasp unprecedented potential.

At home, meanwhile, the baby boomers are getting ready to start retiring and we’re growing older as a society. That means fewer workers supporting more seniors. Potential skills shortages. Greatly increased demands on health care and other public services. And to this demographic evolution add the ongoing movement of people to cities – a shift that places an increased burden on our urban centres and creates new challenges for our rural communities.

Two significant forces – a changing world and changing demographics. How do we prepare for the pressures they will exert on Canada? The answer is that we must do what government has too often been unable or unwilling to do. We must plan ahead. We must find better ways of working together.

During the deficit years, long-term planning was all but impossible at the national level. That’s because the federal government was always concerned with the now -- with the urgent pressures, the need to borrow, the rapidly escalating interest payments. We didn’t just have deficits back then – we had a culture of deficit. Liberal government, Conservative government – it didn’t matter. Nothing ever changed.

We put an end to that. We balanced the books. Eight consecutive years in surplus now. Indeed, Canada is only member of the G-8 not in deficit. Think about that – the only one.

This is a new era – an era of fiscal responsibility, of living within our means. This new era demands governments committed to foresight, determined to work not only for the Canada of today but for the Canadians of tomorrow.

There are those in the House of Commons who don’t agree with my approach of reinvesting the fiscal dividend in our collective future. Indeed, they continue to demonstrate their opposition by doing whatever they can to prevent the budget bills from being passed. Some of these people are of the view that we should simply cut taxes deeply and walk away from initiatives that might seem expensive, such as affordable early learning and child care, such as the New Deal. That’s a legitimate point of view, but it’s not mine.

For me as Minister of Finance, balancing the budget was never an end in itself. I am not a Conservative. We worked hard as a government, a Liberal government, to get to a surplus position – not to thrill economists but so we could actually do something for Canadians; so we could make a positive difference in people’s lives, instead of simply shrugging and saying, “Sorry, we can’t afford to help you. We can’t afford to do anything.”

Today, Canada’s economy and public finances are national strengths that increasingly set us apart. We have the best growth in living standards among the G-8. The fastest job growth. The only nation paying down debt. Low inflation. Low interest rates. Unemployment that’s 30 per cent lower than a decade ago. For Canadians, it’s easier to find a good job, buy a house, pay the bills.

As stewards of Canada’s finances, we helped build this record of achievement. And we will protect it. I will protect it. We will stay the course.

That means financial discipline. It means paying down debt so we are fiscally strong and resilient as our population ages and demands on health care and other public services grows. It means cutting taxes – to benefit families, to encourage entrepreneurs and investors, to help Canada thrive in an integrated North American economy and in a world of economic giants. It means investing in innovation, supporting research and development in communities across our land because ingenuity and specialization are crucial if Canada, a nation of only 32 million, is to prosper among the titans of tomorrow.

And it also means reinvesting part of our fiscal dividend in the kinds of programs and pursuits that enhance our quality of life, that set Canada apart, that give opportunity and security to our people.

That’s why last summer’s agreement on health care is so important – because the only way to begin preparing for the increased costs of an ageing society was with an agreement that’s long-term, that lays out adequate, predictable funding, that addresses the most pressing issues, such as access and waiting times, and that ensures accountability to our citizens.

That’s why we’re building an affordable, high-quality and truly national program of early learning and child care – one that’s focused on development, on giving children a leg up, so each child will get a better start and a better chance of thriving in the later years of school and in an increasingly competitive world.

And that’s why we’re implementing our New Deal for cities and communities. Throughout our nation’s history, pursuing the enduring goals of prosperity and security has required the federal government to set out the new national projects that were essential at each period. This was true when the West was settled after Confederation, when the railroads were built, when in the post-war years our social foundations were strengthened with the creation of Medicare and the Canada Pension Plan.

The New Deal is a national project for our time. It is a cornerstone of our commitment to govern not only for the Canada of today, but for the Canadians of tomorrow. It is an investment in our collective future.

For too long, the federal government failed to recognize that cities and communities are where it all happens. They are the places where national policies touch the lives of people, of families. They are the places where we live and go to work. And because of this, our quality of life as Canadians is measured largely by our experiences on our streets, in our parks, within our neighbourhoods.

Municipalities, therefore, are a crucial order of government, and ought to be recognized and treated as such. Yet for too long they have been underfunded. For too long they have had little input into shaping the national agenda. Thanks to the New Deal, this is changing -- it’s changing quickly, and it is my deep hope and my steadfast goal that it is changing for good.

Under the New Deal, communities are gaining to access new, reliable and predictable sources of funding. And those who represent our communities – those of you in this room and your colleagues across the country – are gaining a greater voice in the national conversation.

When we took office as a government 18 months ago, we made it clear that addressing the needs of our municipal governments – from those of megacities to those of small towns – would be an essential aspect of ensuring Canada’s prosperity in the 21st century. We made a promise to you and to Canadians, and we’re delivering on it.

We’re doing so because our government understands that the prosperity of Canadians – now and in the future – is and will be profoundly influenced by the health, vitality and safety of our cities and towns. We want and we need our communities to be great places to live. And the way to do this is to ensure that our cities, our towns, have the revenue they need to run public transit, to build infrastructure, to protect and maintain green spaces.

Now, within this context, we are well aware that our major cities face challenges that are very different from those that confront our smaller municipalities. The big-city focus may well be on urban gridlock and public transit, on attracting skilled workers. In smaller communities, the most urgent need may be related to ageing infrastructure or to the demand for industry – for well-paying jobs that will enable children to grow up and build a life, without having to leave home to do so.
As we work to plan for Canada’s future and for the generations to come, we must never forget that our major cities are this nation’s key generation points for economic progress. They are the focal points around which economic, social and cultural innovation takes place, and as a result they have special needs. As our major cities go, so goes Canada.

And let there be no doubt: our cities will lose their effectiveness and their vibrancy if their infrastructure is allowed to deteriorate. There will be implications for our national economy and so too for our international reputation. Our big cities are Canada’s signature to the world. We cannot allow them to atrophy. The quality of life in a large city has a direct bearing on the ability of its people to be creative and productive, to innovate, to compete with the best that the rest of the world has to offer, to thrive in an era of increased competition and unparalleled opportunity.

Our smaller communities, meanwhile, face unique challenges relating to population shifts and economic development needs. That’s why it’s crucial that we help them address their most pressing economic issues by giving them the tools to help themselves. The plain fact is that smaller communities sometimes have big infrastructure needs in important areas, such as the supply of clean water. But sometimes the tax base makes it very difficult to afford major projects, such as a new water treatment plant.

That’s why we’re making sure that smaller communities receive their fair share of funds under the New Deal. We know that big or small, all our communities require new sources of stable, predictable funding so they can make long-term financial commitments – commitments that will allow for new initiatives that will benefit all of Canada’s citizens.

To meet the financial needs both of big cities and of small towns, we have worked toward a solution that is both comprehensive and long-term. A rebate on the GST – that was one of our first major acts as a government. Major investments in transit, including a new $800-million commitment announced this week by John Godfrey. And of course the transfer of a portion of the gas tax – a move that will mean billions of dollars in new, predictable revenue being made available for important local projects – projects that will make a positive difference in the lives of Canadians.

We have already signed gas-tax agreements with British Columbia, Alberta and the Yukon. And we are working hard to add to that roster of success – to reach agreements with more provinces and territories and get that money flowing into your municipalities.

But it’s important to understand that our financial commitment to helping to build better communities goes beyond the direct transfer of funds and indeed beyond even our significant investments in infrastructure renewal.

We’re spending billions to clean up contaminated sites in cities and towns across our land. We’re supporting the Green Municipal Funds to accelerate investment in environmental technologies that deliver cleaner air, water and soil, and climate protection. We’re focusing on needs related to immigration – on helping new Canadians settle in major cities, and on attracting immigrants to our smaller centres.

And we’re investing to increase the supply of adequate housing and affordable rental units. Quality shelter is the very foundation of a strong community. Indeed, it is absolutely crucial to the successful settlement of new Canadians and the growth of supportive environments for Aboriginal people, who are moving to our cities in ever-greater numbers in pursuit of opportunity.

With these initiatives, we are seeking to help improve quality of life for Canadians. But the New Deal is not only about funding, for money alone will not guarantee the future prosperity and success of our communities. There are two other crucial components that help to define our approach to this new partnership with municipalities.

First, the New Deal recognizes that sometimes the best way to achieve national goals is to engage people at a local level.

On the environment, for instance – we will achieve very little unless Canadians commit to making it happen. Local hands can build more change and do more good than we ever could from Ottawa. That is why we are putting money in local hands to prompt environmental change and working with local governments on infrastructure that supports environmental change – money for transit, new means of dealing with waste, diversifying into more green energy sources, and so on.

Second, the New Deal recognizes the need to bring municipal governments and their leaders to the national table – and to give them a voice as we establish the objectives of the nation.

Now, what does that mean? It means that our government is dedicated to making local governments true partners not only in implementing the national agenda, but also in setting it. That means your voices will be heard before the federal budget is established each year. It means a spirit of partnership will define our shared pursuits. Above all, it means that our government will never hide behind walls and claim that the health of our communities is not a national concern.

Make no mistake: we respect the responsibility and the role of the provinces. We have no intention of interfering in their jurisdiction. For that reason we are working in partnership with them to implement all aspects of the New Deal. But unlike some, I believe the cities and communities you represent – the places where so many government services are delivered – deserve to be treated as real and mature partners in our nation. They deserve to help guide where we as a country are going. Because together, with all orders of government involved, we can accomplish more and achieve more for Canadians.

Our New Deal for Canada’s cities and communities represents the beginning of a long-term co-operative relationship. A relationship that will contribute to the more effective and efficient building of our country. A relationship based on forging economic opportunity, social well-being and environmental conservation.
Ladies and gentlemen, this is Canada’s time. I look to the future and I see such promise, such potential. I travel this land and I see a country and a people that are poised to seize the opportunities that lie ahead. There is so much we have going for us as a nation.

The New Deal is a central part of our plan to ensure Canada thrives in the years and decades ahead. To protect and build on our strong economy. To make Canada the envy of the world.

As long as we maintain our fiscal integrity, as long as we protect and enhance our social foundations, as long as we have the wisdom to invest in the vitality of our cities and towns, I believe that Canada will continue to discover greater opportunity, from which will come yet greater prosperity.

I believe in a government that recognizes the forces that will shape our world and then makes sure that we are ready to confront them, all of us, together.

I believe in a Canada that has a strong national government that is a force for good, making a positive difference in people’s lives, representing our values and our interests on the world stage.

I believe in a Canada that keeps its economy strong, keeps unemployment low, and protects its prosperity by refusing to go back into deficit.

I believe in a Canada that values and protects its publicly funded medical system, so care requires a health card, not a credit card.

A Canada that invests in the future of generations to come with affordable, high-quality early learning and child care, and a post-secondary education system that’s second to none.

And I believe in a Canada that supports and helps to strengthen its cities and communities, so that our rural municipalities can thrive, so that our major cities can serve as our signatures to the world

This is the Canada I believe in. This is the Canada we are working toward.

Because I believe that as a generation, we will ultimately be judged not by the conventional wisdom of today but by the Canadians of tomorrow. They will look back. They will understand that we had the means to plan ahead. And they will see that we acted – that we reinvested in the great shared project we call Canada; that we were up to the challenge of using opportunity in our day to build for them an even brighter future.

Thank you.