Mr. Speaker, it is a pleasure today to speak about the main estimates for budget year 1994-95.
These estimates represent the fulfilment of the government's commitments to Canadians. They also represent a balanced approach to promoting economic growth in jobs while taking steps to reduce the deficit.
These estimates reflect the fact that there are no quick and easy solutions to the financial issues which confront Canada. It is essential that Canadians understand this in order that they may be able to make with us the difficult choices which lie ahead. I am therefore pleased to have the opportunity to talk about some of the highlights and significance of these estimates.
First it is important to set these estimates in the context of the government's fiscal plan. When the minister tabled his budget in February of this year he said that it represented the first stage of a two-stage budget. That budget has set the country on the road to economic recovery, but there is still a great deal of work now being done to prepare for the second stage of the budget.
As we promised, the government has launched a number of initiatives and reviews which will enable us to accelerate our progress down that road to economic recovery.
It is important that the government take action but it is also important that the government take the time to take the right action.
For example, the President of the Queen's Privy Council and Minister responsible for Public Service Renewal is reviewing the programs of every department. He is also reviewing the structure of every commission and federal organization. Moreover, he is co-operating with the provinces to find ways to reduce overlapping and duplication. These measures will ensure more efficient and affordable government services to Canadians.
As for the Minister of Human Resources Development, he is currently conducting the most comprehensive review of the social security system in Canada since that program was put in place. It should be clear to everyone that the government intends to do what is necessary, and to do it in a responsible way, from a financial point of view. The results of these reviews and other initiatives will be made public as early as this fall, so that they can be discussed in the most open budget process ever put in place by a government.
Canadians will have a say in the critical decisions which will have to be made. At that point, we will have reached the second stage of the budget.
As the President of the Treasury Board said in the House when the main estimates were tabled in February, the estimates set out the details of $160.7 billion in planned expenditure for this fiscal year. Overall program spending, which is total spending less debt service charges, is increased by just 0.7 per cent.
Spending on most government programs has been reduced. The operating budgets of government departments have been reduced by $400 million, with further reductions of $600 million to come in the next two years. Defence cuts total $745 million this year alone, with more to come. Grants and subsidies to business have been substantially reduced. The government has frozen the wages of public servants for a further two years. This action has reduced the cost of providing necessary services
while making it possible to protect jobs and meet job security commitments to our employees.
At the same time as taking these necessary reduction measures, the estimates provide for $700 million for the implementation of the national infrastructure program. This is a key element in fulfilling our red book commitment to create jobs. We know there are two sides to the ledger. There is the expenditure side and there is the revenue side. With so many Canadians out of work the revenue side of our ledger book is not in good shape either. We are paying attention to both sides of the ledger book.
It was the Prime Minister who launched the infrastructure program in his December 1993 meeting with the premiers. Within eight weeks agreements had been signed with every one of the provinces in Canada. In spite of those who said it could not be done, a three-level program was put together in a matter of weeks. The municipalities have found the money to participate and all three levels of government are working co-operatively.
Furthermore the federal government came up with its $2 billion share of the program without increasing the deficit. As we promised, funds were reallocated from other less productive, less high priority federal programs.
I take this opportunity to say that we expect 80 per cent of the project funding will go toward core infrastructure such as water and sewer systems, roads and bridges. We are committed to funding projects with the municipalities that are their priority. Some of these projects are non-traditional but nevertheless are innovative and worthwhile.
When the budget discussions take place this fall it is important that Canadians understand where their tax dollars go, what benefits and services are provided and who receives them. It is important because I believe that many Canadians have been given the impression that with a few minor changes here and there, a bit of tinkering we could balance the budget and live happily ever after and nobody would be hurt.
This is nothing but a fairy tale. We can and we will return to full economic health but difficult choices lie ahead and making the right choices requires that the public be fully informed and involved.
When the main estimates were tabled in the House in February both official parties in opposition predictably expressed their disappointment and claimed that the budget did not go far enough to eliminate waste in government.
We recognize that we must constantly find more efficient ways of delivering services to Canadians and we are doing that. The Treasury Board secretariat is pursuing a variety of initiatives to improve efficiency, including a number which take advantage of the exciting potential of new information technology. These initiatives promote responsive and affordable government services.
In one of many examples 18 government departments are together establishing 10 Canada business service centres, many of them with the participation of the provinces and local authorities. These centres reduce complexity and overlap for business clients and provide one stop shopping with no increase in costs.
A wide variety of initiatives to improve service and reduce costs is described in part I of the estimates. It makes good reading for those want a current picture of what the government is really doing to improve efficiency.
I certainly recognize that, in a parliamentary system, the role of the opposition is to oppose government's measures. Moreover, it may be that the two sides truly disagree as to which policies would best serve our country. However, we are not doing Canadians a service by implying that the deficit could be reduced overnight if only someone had the courage to take the bull by the horns.
Last February, the hon. member for La Prairie said that there was some fat and some waste in the government operations, and that billions of dollars could be saved if only the government eliminated waste and poor management practices. The fact is that if these simple measures were enough to solve the problem, we would already have taken them.
As the main estimates show, the cost of operating the entire Government of Canada, excluding defence, is just 12 per cent of the total expenditures of $160.7 billion, about $19 billion. If the government were to shut down all of its operations, cancel every one of its programs, fire every one of its employees, there would still be a deficit of more than $20 billion.
There would be no food inspectors of course, no air traffic controllers, no prison guards, no scientists working for Canadians in the fields of health and the environment, and no tax collectors either. Some of us might like that, but then the deficit would be even higher. That there would still be a deficit without any government operation assumes of course that there would be somebody to write cheques for the other 88 per cent of government expenditures.
The other levels of government receive transfer payments of almost $29 billion, most of it going to health care, to social services, to post-secondary education and the equalization payments which ensure that from coast to coast to coast in this country the less wealthy provinces have an opportunity to provide comparable services to their citizens.
There is another $20 billion that the Minister of Finance perhaps would need some help in writing cheques for if we had no public service, no government operations; $20 million to Canadian seniors for old age security and the guaranteed income supplement as well as another $19 billion to the unemployed.
Perhaps people who complain about fat and waste could tell us how we can possibly solve the deficit problem by getting rid of the government.
Canada has just recently been rated by the United Nations once again as the best place in the world to live. This is something all Canadians should be proud of. It has not happened by accident. It has not been achieved without a cost either. We have been borrowing to finance our programs, programs which many Canadians have come to view as a right of citizenship.
The public accounts of Canada show that in the 10 years from 1984 to March 1993 the debt of the federal government has more than doubled to just over $500 billion. As a result this year's main estimates provide for interest charges of $41 billion or 25 per cent of the budget on that debt.
If we add another $11 billion for defence and $5 billion for crown corporations we begin to get a picture of where the money goes. We spend money on what Canadians want and need and that is what these estimates are all about. That is also why we have a deficit.
Part I of the estimates provides a comprehensive overview of the government's expenditure plans. I recommend it to all Canadians who want to know how their money is spent. I recommend it to all Canadians who want to participate in a meaningful and positive way in the budget consultations that will take place this fall.
So it is not being honest to tell taxpayers that we only need to cut some fat to alleviate the tax burden, or that it is possible to significantly reduce spending with no one feeling any real adverse effect.
To try to make Canadians believe that there is a quick fix and that the government is not prepared or able to apply it, undermines the confidence of Canadians in their democratic institution. When they hear about these so-called quick and simple solutions, Canadians are less apt to realize that some hard and vital decisions must be made.
My comments may sound somewhat like propaganda, but I want to tell this House that the government intends to ask members from all parties, as well as the general public, to participate in a comprehensive discussion on the importance of the budget. To that end, we must question the very nature of government spending. I would like to conclude, for the benefit of those who might still be sceptical, by referring to some comments made by the Auditor General.
In his 1991 annual report the Auditor General said that he had an impression that a dedicated, competent public service is dealing with complex problems that have developed over the years. He also stated: "The deficit is not a result of bureaucrats burning the taxpayers' money but rather the reasons for the deficit are profound, complex and difficult to solve. I sense that there are few easy fixes".
In his 1992 report he went on to say that the reality is that governments alone do not create deficits. International forces beyond our control and the needs and demands of the electorate also contribute to deficits.
I would like to conclude with a final piece of advice from our Auditor General also from the 1992 report: "There is a need today for full and frank discussion about deficit, debts and related public policy choices".
I invite members of the House today to begin that frank, honest, open discussion and I assure Canadians that this government will give them the opportunity to be part of that debate as well, well before the budget for 1985-96 is prepared, well before the tabling of the next version of these estimates.