Mr. Speaker, today I present the 1994-95 main estimates for the Government of Canada.
I have the honour to table the first Estimates of this 35th Parliament, which contain the government's expenditure plans, department by department, program by program, for the next fiscal year.
I take pride that these estimates reflect the commitments we made to Canadians in the election last fall. They reveal a balanced approach in which the government supports growth and creates jobs while taking steps to reduce the deficit.
The main estimates set out the details of $160.7 billion in planned expenditure in the next fiscal year. This includes the $112.1 billion in statutory expenditure that flows from legislation that Parliament has previously approved and $48.6 billion in expenditures for which we are seeking parliamentary authority at this time.
The main estimates are the first step in carrying out the expenditure plan amounting to $163.6 billion set out in the budget of two days ago delivered by my colleague, the Minister of Finance.
However, unlike the budget, the main estimates do not include reserves and they do not anticipate the impact of proposed legislation. In other words, if legislation has not yet been passed then the dollar figures would not be in the main estimates.
The main reason total spending is up is the increase in public debt charges. Program spending, which is our total spending less public debt charges, is virtually flat, increasing by only 0.7 per cent. Spending on most programs is down.
Old age security and aboriginal programs account for a large part of the increase in program spending. That is because of an increase in the population in those two categories which are drawing on the programs.
As the Minister of Finance made clear two days ago, this is a budget that sets in motion the most comprehensive reform of government spending policy in a decade. The budget tabled on
Tuesday and the main estimates that I table today provide a framework for the future delivered by a government for the future.
One of the clear policy planks of this government is that we are going to do what must be done and we are going to do it in a fiscally responsible way.
In the main estimates we have set a course of action for each component of the agenda in "Creating Opportunity", better known as the red book. Canadians have told us that job creation is a high priority and in the red book we have said that a national infrastructure program would be a key element in job creation.
Since we have come to office, I am proud to say that we have made this a reality by signing agreements in every province across this country. In the main estimates we are asking Parliament to appropriate more than $700 million in the coming fiscal year for the implementation of this program.
Also in the red book we said we would impose further cuts in operating budgets by some $400 million in 1994-95, increasing to $620 million in the following two years. The main estimates reflect the commitment. We hope that we can generate a lot of these savings through efficiency gains, but we realize that it may also require having to set priorities.
Of the $400 million just mentioned, the largest part will come from savings on professional services. These are services that we contract for. We will shortly be asking Parliament to look at this whole area of contracting out.
However, this was not enough. Solving our fiscal problem required taking more restraint measures in the operating budgets. We looked at different options available to us. We looked at what other governments and the private sector were doing. We consulted with our public service unions in this process. In the end we did what we believe is best for Canadians, best for public service employees and for the economy.
As the Minister of Finance stated in the budget, we extended the freeze on the federal public service for a further two years and we suspended annual increments for two years beginning in 1994-95. We also provided for the opportunity, working with our employees and working with their bargaining agents, to be able to shorten that period of time by finding other efficiencies in government spending so that we could in fact end that freeze at an earlier time.
We believe that under the circumstances this was the best course to follow. It allows us to better protect jobs while minimizing the impact of our ability to deliver quality services to Canadians at the lowest possible cost.
The reduction in the defence budget reflects reality. We had a defence structure that reflected the priorities of the past. The world order was changing and we had to adapt. The result will be an armed forces that will meet our future needs.
Reductions in our international assistance funding is a statement of our fiscal capacity rather than a reflection of what really is the need. We will nonetheless continue to spend $2.6 billion on international assistance as is shown in the main estimates.
Canadians told us that grants to business were not getting the best value for the tax dollar. We made it clear in the red book we would cut grants that were not of value in helping small and medium sized business and we have done that.
Canadians were vocal in expressing their desire to reform the unemployment insurance program because it was more than taxpayers could afford. The payroll tax required to pay the benefits was putting us in an uncompetitive position vis-à-vis our trading partners. We had to take action and we have.
In the main estimates 16 per cent of the total spending is in payments to other levels of government and 25 per cent is in payments to persons such as the old age security and unemployment insurance. The government will spend about $62 billion on social programs and $4.8 billion on natural resource based programs, $3.9 billion on industrial, regional and scientific programs, $2.8 billion on transportation programs, about $3 billion will go to cultural and heritage programs, $3.3 billion for justice and legal programs, and $6.4 billion for general government operations.
My colleague the Minister of Finance made it clear in his speech this is only the beginning of reform. He announced that over the next year we would make service delivery more efficient and effective and we will do that.
As a result of the course set out in the budget, program expenditures will decline in real terms between now and 1995-96. Even now, as I said earlier in my remarks, expenditures are virtually flat with last year.
Our annual deficit is on a downward curve, a very important downward curve, and we have set our sights on the fiscal objective of a deficit which amounts to no more than 3 per cent of all the goods and services we produce in Canada in a given year.
This is the true sign of a government that listens to the electorate, shows leadership, takes decisive action, consults its partners, and sets a clear vision for the future of each and every Canadian.