Bill C-207 (Historical)

Ted Menzies Parliamentary Secretary to the Minister of Finance

Mr. Speaker, as members know, the finance committee has studied Bill C-207 and the Liberal members, along with the Conservative majority, recognize the many flaws in the bill.

It would be unfortunate, but should it pass, it would cost the federal government $600 million in foregone revenues, with no evidence that this would help regional economic development. I would encourage all members of the House to act responsibly and oppose this private member's legislation.

Denis Lebel Roberval—Lac-Saint-Jean, QC

Mr. Speaker, tomorrow the House will vote on private member's Bill C-207 introduced by the Bloc. The bill was rejected by the majority of members of the Standing Committee on Finance because the financial implications were too great, it would not obtain the desired results and it did not constitute a long-term solution.

Canadians want real solutions like our targeted initiatives for regional economic development—for example, the $1 billion national community development trust—and not Bloc proposals that are riddled with serious shortcomings.

Could the Parliamentary Secretary to the Minister of Finance explain to the House the ramifications of passing such a bill?

Robert Bouchard Chicoutimi—Le Fjord, QC

Mr. Speaker, this Thursday, members of the House of Commons will have an opportunity to vote on Bill C-207 at report stage from the Standing Committee on Finance. I introduced this bill in 2006.

Since then, a number of individuals and organizations have expressed their approval for a tax credit for new graduates working in designated regions. Some 60 municipalities, RCMs, youth forums, educational institutions, youth employment centres and chambers of commerce have decided to support Bill C-207.

New graduates working in Haute-Mauricie, Gaspésie—Îles-de-la-Madeleine, Abitibi-Témiscamingue, the upper Laurentians, the North Shore, Saguenay—Lac-Saint-Jean and northern Quebec would be entitled to a maximum tax credit of $8,000.

We need measures to stop youth out-migration and promote the retention of skilled workers in economically depressed regions. Bill C-207 meets that need.

Dennis Bevington Western Arctic, NT

Mr. Speaker, it is a pleasure to stand and speak to Bill C-207, An Act to amend the Income Tax Act (tax credit for new graduates working in designated regions). The bill would give each graduate who settles in a designated region a credit equal to 40% of the individual's salary, up to $8,000. This would encourage new graduates to settle in designated regions.

This is an important concept but it only goes so far in the whole context of what is happening in the northern regions of Canada. I also have full sympathy for northern students because almost all of them must travel to institutions in different cities to get a degree in a particular subject. In my own riding in the Northwest Territories, the government invests heavily in community colleges, to the point where students can now stay in the Northwest Territories and get a degree in education or in nursing, but that is about it.

In order for students in a designated region to get the education they want, they need to travel. The expenses are greater for them at the beginning. They also do not have the luxury of living at home when they are going to school. Once again the burden is greater on students from the far reaches of our country in achieving the education they need. These things all add up and make it very difficult for students.

When I went to school, our federal government at that time--

Paul Szabo Mississauga South, ON

Mr. Speaker, I am pleased to rise during private member's business to speak to Bill C-207 put forward by the Bloc member for Chicoutimi—Le Fjord.

As has been covered in the debate, and I do not want to spend too much time describing the bill, it prescribes a tax benefit through a tax credit to allow employees, in areas which have economic challenges, who may have skills needs but may not be able to compete with some of the more attractive centres, an opportunity to work in those centres.

I can only imagine what Canada would be like if some of the smaller, economically challenged regions and communities in our country were to continue to fall behind. The population and businesses would decline, people would move away, jobs would be lost, and companies would shut down.

I believe this bill is important for Canada because it has to do with the shared value of the need for regional economic development. There are areas within our country that need some assistance from time to time to ensure they have some of the tools they need to continue to be economically vibrant.

We can imagine new graduates with the needed skills having opportunities to go to work in Quebec City, Montreal, Toronto or Vancouver. What about a place like Abitibi-Témiscamingue? Is it going to be able to compete with the fancy job in Montreal? Is it going to be able to pay the same money to attract a skills set to that area?

When I look around the country, I feel like saying that Canada is a picture or painting which has many aspects to it. How many of those parts of the picture can be taken away and still retain the integrity of the picture? It is very easy to imagine that Canada could shrink to urban economic centres. Eighty per cent of our population lives within 100 kilometres of the U.S. border.

There is a real threat and it affects not just agricultural communities, not just resource communities but thriving communities that have good fundamental economic bases, and they are at risk. That is why we have regional economic development programs because we need to ensure that there is a continuation of operations and the sustainability of communities.

When I spoke to the hon. member for Chicoutimi—Le Fjord, I looked at some of the names of the places. I do not know how many members may have been to places like Avalon Peninsula, Newfoundland and Labrador; Cape Breton; the north shore of Nova Scotia; Miramichi or Edmundston in New Brunswick; Gaspésie; Îles-de-la-Madeleine, Quebec; Estrie, Quebec; Laurentides; and Abitibi-Témiscamingue.

Windsor-Sarnia right now is undergoing a tremendous downturn in its economic outlook. Housing has gone down and unemployment has gone up. This was not the case a long time ago. Communities like Windsor were vibrant. The economic spin was going very well. Now, Windsor is becoming a have not area. It is just like a number of other communities across the country, whether it be in eastern or western Canada, northern Ontario or within Quebec. Circumstances change.

In fact, we are experiencing a significant shift in wealth and economic activity in Canada right now. Resource provinces are doing extremely well: Alberta, Saskatchewan and now Newfoundland. But 60% of the economic activity in Canada is in Ontario and Quebec collectively. That is where there is a lot of manufacturing going on and that is where there are going to be great pressures in terms of both employment and population dropping.

Populations are shifting where the resources are. I do not know what happens when finite resources start to disappear. I assume that people will migrate back again to the next best opportunity.

In the meantime, what will be the consequences? What areas will have to be sacrificed because we have not taken the initiative to provide certain incentives to allow them to sustain themselves when there are significant economic challenges.

We need our young people to be proud and to continue to be part of the communities in which they were raised. We do not want them all to stay in that community. We need to allow them to be as good as they can be. It may be a matter of graduates being able to go into another community which may be very similar, maybe not an urban centre, but chances are the economic advantages will not be there and will not be attractive enough for them, compared to other opportunities.

This particular bill provides at least initial economic assistance for these individuals to go, to take that job in a community that they know is the best fit for their skills, or is in an area in which they feel most comfortable. It is a win-win situation, not only for these individuals but also for the community and for the country as a whole.

I looked at the evidence presented at the finance committee. Everybody thinks that the committee did a very good job on this. I must say that I was a little concerned because one of the members of the committee, and I will not name the member or his party, but the member did say:

So the goal of your bill is to get young people to stay where they're from; it has nothing to do with making sure that the skill sets are meeting the needs of certain areas.

That tells me that this member did not even read the bill nor even understand the bill. In fact, the objective of the bill is quite the opposite. It is not to ask people to stay where they are, it is to give them the opportunity to go where they have the best opportunity to get that job and to develop those skills.

Then I hear another member over here saying, “You give them a tax benefit for one year, and then what are they going to do?” He has a lot of studies. I did not see any, but I can only assume. He can make that assertion. He asks, “After one year, what will they do?” He would say that they may leave because they are just there for the little tax credit, but once the tax credit ends, they are gone.

I know of members, even in my own caucus, who said, “My kid went to a community. He said he is going there for a year or two years”. That was eight years ago and that individual is still there doing that job because when a person gets that first job and develops that skill, his or her career is starting to build. People do not build careers by bopping around, job to job, every year, looking for a tax credit. We have to respect people's intelligence a little bit more than that.

I see that my time is up. I have a few more things that I really would like to say about the bill, but let me just say that I have taken enough time to look at it and I believe that the approach of the bill is sound.

There may be some disagreement or some discussion about the mechanics, but Quebec has had such a program since 2006. I understand that about 10,000 graduates were eligible. It is estimated that some 30,000 Canadian students, graduating with good skill sets, ready to serve Canada no matter in what region they choose to, would be eligible for such a program.

How can we be against that? It is the right thing to do. I support it and I will encourage my caucus to support the bill.

Steven Blaney Lévis—Bellechasse, QC

Mr. Speaker, you can hear them, too. I would like the members to listen to me. I had enough respect to listen to them and I would like them to do the same.

This is yet another in a slew of disappointing and really poorly thought-out economic proposals coming from the Bloc Québécois, proposals that really do not address the priorities of Quebeckers in any meaningful way. It is such poor proposals that have even led the sponsor’s Bloc colleague, the member from Longueuil—Pierre-Boucher, to admit, and I quote:

The economy is constantly an albatross for us. We are profoundly uncomfortable when it comes to discussing the economy.

The Bloc members had the chance to support budgets that included concrete measures to help Quebec's economy, but they remained seated. Other colleagues, such as the member for Roberval—Lac-Saint-Jean, rose in this House and stood up for the people of Lac-Saint-Jean by supporting these measures. Colleagues like the member for Charlesbourg—Haute-Saint-Charles rose and stood up for Quebeckers. They are working here, proud to be both Quebeckers and Canadians.

Why did the majority of the members of the Standing Committee on Finance vote against this bill? Because of its many serious and glaring flaws and the fact that it does not hold water.

First, the designated regions referenced in the bill are drawn from a list that has not been updated in over 20 years and does not account for the economic changes that have taken place during that time.

Second, the tax credit would also introduce inequities in the tax system: inequities between recent graduates and those who graduated earlier, and inequities between new graduates who work in different regions.

Third, the credit would be exceedingly expensive. The money could be invested elsewhere to support our manufacturing sector, which would create jobs and keep our young people in regions such as Bellechasse, Les Etchemins and other regions throughout Quebec.

Bill C-207 tries to use the tax system to encourage new graduates to work in certain regions of Canada in order to address perceived skills shortages, but attempts to do that in ways which, in the end, would make the tax measure ineffective. It would, for example, only provide tax relief to a new graduate's first 52 weeks of qualified employment. What happens after the initial 52 weeks when there is no longer a credit available? Clearly, this type of measure cannot yield long term benefits to regions, and I am not even sure it would have an incremental impact in the short term beyond reducing taxes for a selected group of workers.

Another concern with the bill is that it does not make any attempt to target skills sets that are in short supply in a designated region or that could benefit its development. As I just mentioned, it has been 20 years since the list of designated regions was updated.

That is not all. There are other flaws in the bill. As I said, it would create severe inequities by discriminating between regions, and between groups of graduates.

Graduates who finish their programs around the same time, but who live and work in different regions, could face entirely different income tax burdens during their first year of employment. That would result in inequities and create two classes of graduates. As well, two graduates working in the same job and region, but whose graduation dates are a year apart, would face an $8,000 gap in their respective tax burdens. This, too, is patently unfair.

Finally, this bill would be incredibly expensive. Not only would it be ineffective, it would be costly. Estimates suggest that the credit could cost up to $600 million, money that would be taken away from other areas on a tax measure for which the outcome is uncertain.

This bill is the wrong way to go.

Steven Blaney Lévis—Bellechasse, QC

Mr. Speaker, I am very pleased to rise today to speak to Bill C-207.

Unfortunately, I cannot support this bill, because it is flawed and expensive.

However, I supported a bill that created a fund for the manufacturing industry and I supported a budget that creates a package through which manufacturing businesses throughout Quebec can expand and create good, well paying jobs.

As usual, the sponsor of the bill introduces bills to impress the gallery, but unfortunately, he did not act at the right time. He did not stand up for Quebeckers, to support concrete measures for Quebec industry.

I would simply like to remind the sponsor of this bill that the economic outlook is very encouraging at this time. The manufacturing sector in Quebec saw an employment increase in the last quarter. Imagine that. These are encouraging numbers in terms of job creation in the manufacturing sector. There was also an increase in the net number of jobs created in Quebec.

Mario Laframboise Argenteuil—Papineau—Mirabel, QC

Mr. Speaker, I am pleased to speak on behalf of the Bloc Québécois about this excellent private member's bill, introduced by my colleague from Chicoutimi—Le Fjord, a member who does an excellent job. I would also like to say that the member for Chicoutimi—Le Fjord is an example for everyone in the Saguenay—Lac-Saint-Jean region, a region that, for various reasons, is not always favoured economically. One of those reasons is the current serious forestry and manufacturing crisis.

Obviously, one way to deal with the forestry and manufacturing crisis is to encourage businesses to hire young people. That is what this wonderful bill, Bill C-207, introduced by my colleague for Chicoutimi—Le Fjord, seeks to do.

I will summarize the bill for you. The Bloc Québécois does not reinvent the wheel. Our goal in this House has never been to claim that we are all-knowing. We are able to look at what other parliaments are doing and borrow their positive initiatives. One of those positive initiatives came from the Quebec government, which implemented a similar credit in 2003. Their goal was to curb the exodus of young people—this bill has that same goal—as well as to deal with the shortage of skilled labourers.

This bill would introduce a tax credit for young graduates who accept jobs in a resource region. Under the bill, this credit would be equal to 40% of the young graduate's salary for the first year, to a maximum of $8,000.

In 2003, the first year the Government of Quebec instituted a similar credit, 2,500 young workers applied for it. In 2004, the number rose to 9,700. There was a tremendous increase of 7,000 young workers between 2003 and 2004.

This applies to all designated regions, which are regions with a declining population. That is the bill's objective. As I have already said, and will continue to say, my colleague from Chicoutimi—Le Fjord is being practical. He looked at the situation in Saguenay—Lac-Saint-Jean, decided to take the bull by the horns and deal with depopulation.

There is not one member in this House who can afford to ignore such situations. When areas such as Saguenay—Lac-Saint-Jean experience an exodus of youth we must try to find solutions. The member for Chicoutimi—Le Fjord has made a good attempt, in tabling Bill C-207, to do something about the exodus of youth and the shortage of skilled labour.

This tax credit for designated regions will not apply to just the Saguenay-Lac-Saint-Jean area. The bill will apply to all Quebec and Canadian regions that may experience depopulation so that we can retain our youth and deal with the shortage of skilled labour.

We will see, in this House, those members who care about the regions. We will see where political parties stand when they vote on Bill C-207. I cannot fathom that there would be a Conservative member who would vote against. The former mayor of Roberval is from the Saguenay—Lac-Saint-Jean region and the member forRoberval—Lac-Saint-Jean. I met this member when he was mayor of Roberval and he had a backbone. It seems that he has become spineless since becoming a member of the Conservative Party. We will see what he does and how he will react to the vote on Bill C-207.

Once again, the minister responsible for this region, the member for Jonquière—Alma, has already said he opposes this bill. That is not surprising because he was already a spineless Conservative. He only has himself to blame.

There is one thing, however. Once again, this bill, which was introduced by my colleague, the hon. member for Chicoutimi—Le Fjord, simply duplicates a measure adopted by the National Assembly of Quebec in 2003 that produced positive results. I invite people to listen to the figures once again. I am pleased to repeat them, since some of my colleagues in this House seem to prefer to hold the party line. They will be given documents prepared by their research staff and what I have to say will certainly not appear in their documents.

With respect to the program instituted in Quebec, in 2003, 2,500 people took advantage of it and in 2004, that number rose to 9,700 people. It continues to increase all the time. This therefore allows businesses to hire young people and allows the regions to stop the exodus of young people. It does not apply to all regions of Quebec. Some regions of Quebec are seeing a growth in population, like elsewhere in Canada.

The regions that are experiencing growth do not warrant such assistance, but we must do everything we can to keep young people and jobs in the regions with declining populations. We must stop the decline of the regions. That is the major problem created by the current crisis in the forestry and manufacturing sectors. We run the risk of losing our entire work force in the regions, of losing all the expertise and experience of those men and women who were the economic driving force of our regions.

And this is all because the Conservative Party decided not to give businesses direct assistance. They offer tax credits, but those are not refundable. A forestry or manufacturing business that is not turning any profit will not get any tax credits and cannot benefit from the advantages of the budget that was tabled. The Conservatives do not seem to understand that if a business is not paying taxes, tax credits must be refundable.

We also need a plan to help companies modernize. In the case of the forestry sector, trees will continue to grow. It is not a matter of telling people, as the Conservatives are doing, to try to find a new career, when forestry workers have experience in that field. They are being told to go into computer technology or into other economic diversification sectors. Meanwhile, the trees will continue to grow. If we want to compete, we need to modernize our companies and help them purchase state-of-the-art technology so that they can become more competitive and regain their position on the market.

The Conservatives decided to leave it to the free market. They saw that smaller companies had been taken over by larger ones, and that the larger ones will not make it through the crisis. The situation will play out as they want it to. There will be regions living off the forest that will no longer have an economy, and the people will move to larger centres. That is not what the Bloc Québécois wants.

My colleague from Chicoutimi—Le Fjord is doing excellent work. I am always surprised by what I read in the news in his region. Even the media, which is often rather tough on the Bloc Québécois, believe that he is doing excellent work. That is to his credit, but not to the credit of the two Conservative members from the Saguenay—Lac-Saint-Jean region.

I am anxious to see how the Conservative members will vote on this bill. I thought that the former mayor of Roberval, the member for Roberval—Lac-Saint-Jean, found it interesting. Then he realized that there is the Conservative Party line to toe when the minister, the member for Jonquière—Alma, said that he opposed the idea. He is probably about to vote against a measure that would help young workers in his region and stop them from leaving the area.

I always find that surprising. I am always amazed to see a Quebecker buckle before the Canadian right and to give in. I have a great deal of difficulty with that. He is repudiating our values, the interests we defend and our citizens for the sake of the future of a political party that no longer has a future and that will see what happens in the next election. Perhaps the time has come for Quebec MPs to rise and defend the regions of Quebec, whether they are Conservatives or Liberals.

They will be in a position to say to Quebec's designated regions experiencing depopulation and the exodus of their youth that, for once, they will implement a positive measure on their behalf—one that produced results in 2003 when implemented by a similar law by the Quebec government. Quite simply, it would give this opportunity—