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Ottawa-Carleton Board of Trade Luncheon
February 13, 1997
Ottawa, Ontario
In a few days, the government will deliver the fourth budget of
this mandate. With every government, budgets are the milestones
and markers of a term in office. They are the statement of its
spending priorities. Its agenda for action.
That is why now is a good opportunity to share with you -- and
with Canadians -- my thoughts about where we have been through
the course of this mandate. And where we are going. Not just as
a government, but as a country.
When we took office in 1993, Canada had lost its fiscal sovereignty.
Because we were so indebted, and so dependent upon them, the money
markets and bond traders had more say over our economy than Canadians
did. Our economic and social fate depended on their whims and
opinions.
The country was suffering from the worst of all worlds. The unemployment
rate in January 1994 was 11.4%. And the deficit was at an all
time high of $42 billion. Canadians had lost hope that an economic
turnaround was possible. We knew Canadians had to recover that
hope.
It was clear to us as a government -- and a nation -- that if
we did not start getting our fiscal house in order, the country's
decline would continue. Unemployment would increase. And the very
ability of the government to act positively on behalf of Canadians
would be lost.
So we took action. The action we promised to Canadians in the
Red Book. The cold, abstract numbers are well known. We have reduced
the deficit from 6% of the GDP when we took office, to our interim
Red Book goal of 3%, which we will meet or better in the budget
next week. And at the rate things are going, we are likely to
beat our target of 2% for 1997-98.
I don't want to pretend that some of the cuts haven't hurt. I
know they have. But we have tried to accomplish the task without
sacrificing the values Canadians hold dear. Like fairness -- to
regions and individuals. Or compassion. Or caring. Or the belief
in strong social programs that can uphold a decent quality of
life for all Canadians. That is why we cut defence spending, but
established a Pre-Natal Nutrition Program and new Centres of Excellence
for Women's Health. That is why we reduced subsidies to business,
but increased spending on programs for young people. That is why
we closed loopholes for the wealthiest Canadians, but raised the
limit for parents who contribute to Registered Education Savings
Plans for their kids.
The job is not completely over, but there is light at the end
of the tunnel . We are already seeing the rewards -- low inflation,
low interest rates, an economic climate favourable to continued
and stronger growth and a growing capacity to address our social
needs and to make the strategic investments we need to prepare
our country for the next century.
Interest rates are lower than they have been in almost 35 years.
In two years interest rates have come down by 5 ½ percentage
points. Short term interest rates are now 2 ¼ % lower than
U.S. rates -- after 20 years of being an average of two points
higher in Canada than the U.S.
This has been more than a government achievement -- it has been
a Canadian achievement. We are succeeding because of the discipline
and support of Canadians. Canadians have understood from the beginning
that this has been about re-establishing our credibility as a
nation. The ability to set goals and achieve them is inspiring
others to have confidence in us as a nation. And even more important,
it is re-building our own confidence in ourselves.
Forecasters in the private sector are predicting that 1997 and
1998 will be years of strong growth. They say we will lead most
of the industrialized world in economic growth. They say the economy
will create an additional 300,000 jobs a year for the next two
years -- on top of the more than 700,000 created since we formed
the government.
I know that for someone without a job these statistics may not
be much comfort. But I want them and all Canadians to understand
what we are doing to combat unemployment. And how I believe our
actions will create a stronger economy and more jobs for all Canadians.
Immediately upon taking office, we implemented our Red Book promise
of the Canada Infrastructure Program in partnership with the provinces
and municipalities. That program has resulted in more than 12,000
capital projects in every province across Canada, creating work
for more than 100,000 Canadians. And we are extending this program
for another year.
We have embraced the opportunities the global economy pose for
a country like Canada. We rely more on exports for jobs than almost
any other major industrialized country. That is why we have taken
the lead in seeking liberalized trade around the world -- and
in the drive for free trade zones in the Pacific and the Americas.
And we are working hard to help Canadian businesses -- big and
small -- sell Canadian products and know-how abroad, creating
jobs here in Canada. That is what the very successful Team Canada
missions -- including the one just a few weeks ago -- have been
all about. And they and other trade promotion efforts will continue.
We have used the same partnership approach to create the Canadian
Tourism Commission with the provinces and the private sector.
Experts say that over 125,000 jobs can be created in this sector
alone over the next decade. And this coordinated approach is already
bringing results -- helping reduce our annual tourism deficit
from $8 billion to $2 billion.
We have also been investing in the other growth sectors of the
future. Industries where Canada can take on the world. That is
what the Technology Partnerships Fund is all about. Investing
in the cutting edge winners -- not with handouts or loans, but
with hard-edged commercial investments. And that will translate
into thousands of jobs for Canadians -- good jobs with a good
future. We are committed to helping our aerospace industry move
from number six in the world to number four. With all the tens
of thousands of jobs that will go with it.
We have tackled structural obstacles to jobs. We have transformed
the Unemployment Insurance Program into an Employment Insurance
Program, removing disincentives for work and making the program
more sustainable. We have reduced Employment Insurance premiums.
Now they are 14% lower than the previous government had planned.
And last fall, we introduced what we call the New Hires Program,
that will virtually eliminate EI premiums on new jobs for almost
900,000 eligible businesses who hire new employees.
In these actions and in everything we have done over the last
four years, the focus has been on setting priorities. In fact,
we implemented the most comprehensive review of government in
Canadian history so that we could focus our scarce resources on
those issues of greatest importance to Canadians. We asked ourselves
what areas we should focus on to best serve Canadians. And where
it made sense to establish partnerships with or leave the field
entirely to the provinces, the private sector or community organizations.
In our sector by sector approach, step by step, we are making
progress. Government cannot do everything. It must focus on the
right priorities and it must find ways to encourage others to
play their part. In our relationships with the private sector,
we have shifted from subsidy to partnership -- and this is already
yielding dividends as our entrepreneurs are breaking new ground
domestically and internationally. Just look at Team Canada. Our
infrastructure program used federal/provincial/ municipal partnerships
to make strategic investments in our communities and create jobs.
The new labour market agreements with New Brunswick and Alberta
are proof that governments are able to work together in new ways
to benefit Canadians. And our agreement with the provinces to
work together on child poverty shows that when it comes to the
most important social issue of our times, governments can work
together.
The Canada Health and Social Transfer and our guarantee of a cash
floor... our reform of Employment Insurance and Seniors Benefits...
the creation, with the provinces and territories, of a Ministerial
Council on Social Policy Renewal... and the cross-Canada consultations
of the National Forum on Health have all established the base
for a new approach to securing our social safety net -- including
Medicare. And they are ensuring that these programs remain sustainable
-- that they are not just a birthright enjoyed by this generation
of Canadians ... but a legacy we can pass on to future generations.
I know Canadians are concerned about the future of social programs.
I know some of the cuts and the reforms have been particularly
hard on some people. But the purpose of all our actions has been
to ensure that those programs are there for future generations.
By taking the actions we had to take -- and in a decent, humane
way -- we are saving the social safety net in Canada. Make no
mistake about it, when a country has to increase the payments
it is making to bankers every year and reduce spending on social
programs, those programs don't have much of a future. That is
why we have had to work to eliminate the fiscal mess. And that
is why those social programs will be able to begin growing again.
Our next budget will continue to advance our balanced approach.
We will not budge in our fiscal discipline. We can't give up now.
Not when so many have sacrificed. Not after so many years of failure
by our predecessors. Not when we are so close.
Not if we want our children to have the same opportunities in
life we had. Not if we want them to have the choices and tools
to build their lives. It would be just plain wrong to step back
into an era of high deficits and low hopes. Wrong to shortchange
our future.
But, in our upcoming budget, as we see the light at the end of
the tunnel, we can begin to make wise investments for the future.
Technology and globalization are transforming economic activity.
Governments cannot change this. Nations cannot hide from it. What
we can do and are doing is work to ensure that Canada and Canadians
are winners in this new global economy. An economy which above
all focuses on knowledge and our knowledge capacity.
That means helping our universities modernize and enhance their
science capacity. It means helping our teaching hospitals improve
their research capacity. It means increasing our investments in
new technologies, research and development.
Investing in the future also means investing in youth. Yesterday,
the Minister of Human Resource Development announced a government-wide
Youth Employment Strategy. It will create new job opportunities
for 110,000 young Canadians and expand a number of successful
programs. Just as important, it consolidates all the government's
programs for young Canadians, making them more easily accessible
through 1-800 lines, a new website and youth fairs -- going to
where young Canadians are and speaking to them in their language.
Investing in economic opportunity is important, but a healthy
economy is not an end in itself. What is important is a healthy
society. That means a decent quality of life for all our citizens.
And a commitment to help those who need it most.
Last June, in this very hotel, on the eve of a meeting of first
ministers, I pledged to Canadians that we would work with the
provinces to reduce child poverty in Canada. We have worked hard.
And we have demonstrated that with good will and common objectives,
Canadian federalism works. I want to congratulate Pierre Pettigrew
and his provincial counterparts for a job well begun.
Choosing this priority as the first focus for our fiscal dividend
says as much about the values of a government -- and a nation
-- as the decisions about where and what to cut in difficult times.
In the coming days we will be announcing concrete actions that
will begin the work of developing an effective, modern, truly
national approach to benefits and services for children and families
with children who need our help. This will not be the solution
to the problem. It will be the beginning of the solution. A well-spent
early dividend from our collective battle against deficits --
federal and provincial. A down payment on social justice now that
we can afford to make one.
Just as our system of elderly benefits was built over many years,
a national approach to combatting child poverty will not happen
overnight -- it will be built one step at a time. But that first
step can be the most difficult and the most important. That is
the step we will be taking in the coming days. We will build on
this base, in partnership, as fast as our fiscal situation allows.
Investing in people means investing in a healthy country. And
that means Medicare. Last week, the National Forum on Health tabled
its report. I am proud of the work of the National Forum. It was
a Red Book commitment -- meant to look past the headlines and
the interest groups and examine how we could improve our national
health care system. It brought together the top experts from across
the spectrum -- and across the country. And they came to a consensus
-- incidentally, ahead of schedule and under budget.
They were unanimous in their support for a universal, accessible,
publicly-funded Medicare system. And they recognized that as a
country -- public money and private -- we are spending enough
on our health care system. But we are not spending it wisely enough
or in the right areas. We have been too focused on the needs of
institutions -- and not focussed enough on the needs of individual
Canadians.
The report of the National Forum is nothing less than a new paradigm
for health care in Canada. A new way of approaching the challenge
of a healthy nation, in keeping with the timeless principles of
the Canada Health Act. This will not be a report that gathers
dust on a shelf. On behalf of the government, the Minister of
Health, David Dingwall, is starting to act on its recommendations
now. We will have specific initiatives to announce in the days
and weeks ahead.
Ladies and gentlemen, we are in the fourth year of our mandate.
But the pace of the work of this government will not slow down
in the days and weeks ahead. Because the task of building a nation
-- a united, committed nation -- can never slow down.
I have said many times that Canada is the work of every day. The
real test of our system is not rhetoric or speeches. It is in
the ability to work together with the provinces, with the private
sector, with community and volunteer organizations... toward common
goals.
For those who talk of the "status quo", of a "rigid
federalism" that never changes, I say just look at the record
of the last 3 ½ years. Governments working together in Team
Canada to bring jobs home to Canada. The federal, provincial,
municipal Infrastructure Program. Our work together in tourism
promotion. The country's first-ever agreement to reduce internal
trade barriers. Our new joint action on child poverty. The devolution
of labour market training to the provinces. The recognition by
the House of Commons of Quebec as a Distinct Society. The five
regional constitutional vetoes. The Canada Health and Social Transfer.
The restriction on the unilateral use of the federal spending
power. Greater cooperation in shared areas like the environment.
These are the proof a dynamic, evolving, changing country.
We are proving that Canada works, that our governments can work
together in the interests of citizens on economic issues, on social
issues, on the environment, on presenting Canada to the world.
We are demonstrating that we can modernize Canada and prepare
for the 21st century. And we shall continue meeting the real needs
of real people. Governing in a way that benefits all regions and
parts of Canada. Doing what has made Canada the number one country
in the world: coming together, working out accommodations, respecting
the diversity of Canadians, looking after our most vulnerable,
and always, always building for the future.
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