House of Commons Hansard #161 of the 35th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was budget.

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A message from His Excellency the Governor General transmitting estimates for the financial year ending March 31, 1996, was presented by the President of the Treasury Board and read by the Speaker to the House.

Main Estimates, 1995-96
Routine Proceedings

10 a.m.

York Centre
Ontario

Liberal

Art Eggleton President of the Treasury Board and Minister responsible for Infrastructure

Mr. Speaker, I would also like to table in support of the estimates part I, the government expenditure plan.

In addition, I will table with the Clerk of the House on behalf of my colleagues part III of the estimates consisting of 78 departmental expenditure plans. We distributed these documents to members of the standing committees to assist in their consideration of the spending authorities sought in part II of the estimates.

House Of Commons
Routine Proceedings

10 a.m.

The Speaker

I have the honour to lay upon the table the expenditure plan in relation to the 1995-96 estimates for the House of Commons.

Government Response To Petitions
Routine Proceedings

10 a.m.

Kingston and the Islands
Ontario

Liberal

Peter Milliken Parliamentary Secretary to Leader of the Government in the House of Commons

Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government's response to several petitions.

Main Estimates, 1995-96
Routine Proceedings

10 a.m.

York Centre
Ontario

Liberal

Art Eggleton President of the Treasury Board and Minister responsible for Infrastructure

Mr. Speaker, today I presented the 1995-96 main estimates for the Government of Canada.

They are the second main estimates of the 35th Parliament containing the expenditure plans of the government for the next fiscal year.

They reflect the government's commitment, as the Minister of Finance outlines in the budget, to restrain spending, streamline operations and change fundamentally what government does and how its programs and services are delivered.

The main estimates lay out details of $164.2 billion in total planned budgetary expenditures for the next fiscal year. This includes $116.2 billion stemming from existing legislation and $48 billion in expenditures for which we are seeking parliamentary authority.

The main estimates are the first step in carrying out the expenditure plan set out in the budget.

Yesterday we heard the Minister of Finance announce an expenditure plan amounting to $163.5 billion in 1995-96. As I mentioned, the main estimates that I have tabled today total $164.2 billion for 1995-96.

The difference between these two figures is explained by the fact that the main estimates do not include the impact of the proposed legislation that is needed to implement some of the budget expenditure cuts that the Minister of Finance talked about yesterday, nor do they include some other technical adjustments which are set out in part I of the estimates.

Program spending in the budget which excludes the cost of interest on the public debt will decline to $114 billion in 1995-96. It will go down to $107.9 billion in 1996-97, down 10.8 per cent from $120.9 billion in 1994-95. This is as a result of the program review and previous budget measures.

The budget cuts spending. It demonstrates that we will continue to reduce the deficit and continue to meet our fiscal targets.

The budget focuses on the need to cut government spending and to improve the economic climate so that job creation can flourish. The program review is a central part of the budget and a key element in our jobs and growth agenda. The government launched the review to pinpoint the programs and services that are no longer useful or that could be delivered more efficiently or effectively by others.

We have seen the results in the budget reducing the federal role in some areas and highlighting the programs and services that other levels of government or the private sector could provide.

By 1997-98, and this is important, departmental spending subject to the program review will decline by some 19 per cent relevant to 1994-95 which is very key in our meeting our deficit target of 3 per cent of GDP in three years and of course going beyond that.

I will give some examples of how the government is implementing the program review in an environment of declining resources. First, the government will focus on its essential responsibilities. For example, Transport Canada will concentrate on developing policy and legislation and setting and enforcing standards for safety and security. As a result some of the department's activities such as its air navigation services will be commercialized. In addition, transportation subsidies will be reduced or eliminated and the remaining operations will be made more efficient.

Second, the government is reducing federal and provincial overlap. For instance, Fisheries and Oceans Canada will negotiate the transfer of its freshwater programs with the provinces and concentrate on conservation and the sustainable use of the fisheries and oceans and other resources.

Third, the government will use new technology to become more efficient. As an example, Environment Canada will automate its atmospheric environment services. The department will also be looking into providing weather services in a more effective and efficient fashion.

Fourth, we are promoting self-reliance by shifting away from direct subsidies to business. The regional agencies will move from direct subsidies to providing loans with more emphasis of course on small and medium size enterprises.

Fifth, the government will recover its costs by charging or increasing service fees to those who benefit directly from them, a move that is fair to taxpayers in general. Such charges include fees for immigration, agricultural inspection, drug testing and drug certification.

Sixth, we will merge similar programs for more efficiency. For instance, Fisheries and Oceans Canada and Transport Canada will take steps to integrate the coast guard and fisheries surveillance fleets.

What I have just outlined shows that we did not shy away from tough decisions. We are focusing on the key functions of the federal government and we are going to get them right.

Inevitably the transition from trying to be all things to all people to offering Canadians fewer but high value programs and services will mean a smaller federal workforce. As a result of reshaping the government and the transfer of some functions to other sectors, the government will reduce the public sector workforce by as many as 45,000 jobs over the next three years. That is the largest workforce reduction by the federal government since it returned to peacetime operations after the second world war.

I have announced a program of options that will help employees to move successfully to new lives outside the Public Service. This program, which is comparable to private sector plans, will be fair to employees as well as fair to the taxpayer.

It will allow us to make the program changes and meet the fiscal targets in the budget. For the remaining programs and services the government will provide services that balance the interests of taxpayers with those of the clients who are receiving them. It will seek cost effective ways to deliver quality programs and services that improve service and efficiency where it can.

Across the government, departments and agencies are responding to the challenge of innovation. The results of the program review and the initiatives I mentioned demonstrate that government is intent on being more efficient and focusing its energies and resources where they are most needed while living within its means, and that means what Canadians can afford. We have a very dedicated professional public service I know can deliver those services.

The government is committed to fiscal responsibility. We will continue to manage changing priorities by reallocating resources. The overhaul of the expenditure management system that I announced recently will help departments adjust their programs to operate with their reduced resources. It will also provide parliamentary committees with the information that they require to carry out their mandate to examine the future year expenditure plans and priorities of the various departments and agencies.

Our ultimate objective is to deliver quality programs and services with the resources Canada can afford. These Estimates are evidence that we are on the right track.

Main Estimates, 1995-96
Routine Proceedings

10:15 a.m.

Bloc

Richard Bélisle La Prairie, QC

Mr. Speaker, the minister has just tabled the 1995-96 Main Estimates. The Main Estimates represent a total of $164.2 billion in expenditures. The minister explained that program spending in the Budget will decline from $120.9 billion in 1994-95 to $114 billion in 1995-96 and $107.9 billion in 1996-97, a reduction of 10.8 per cent.

Where will the $13 billion in program spending saved over a two-year period be applied? It will be used mainly to finance rising debt charges which during the same two years will increase by nearly $9 billion, assuming that the economy is in good shape, inflation is practically zero and interest rates remain at reasonable levels. What we have is an increase of 20.7 per cent in debt charges over the next two years, almost twice the reduction in program spending announced by the minister.

Nearly 75 per cent of all these efforts, of all these program cuts will merely go towards servicing the debt, which will cost us more than $50 billion in charges in 1996-97.

In 1994-95, debt charges represent 33.6 per cent of budgetary revenues. In 1996-97, these debt charges will represent 36.6 per cent of budgetary revenues. Make no mistake, despite program review and previous budgetary measures, the debt marches on.

Program review merely transfers billions of dollars from Canadian citizens to investors who finance a debt that is increasing steadily.

The minister also said that by 1997-98, departmental spending subject to the program review will decline by 19 per cent relative to 1994-95. What the government did not say is that most of the money saved will be used to finance the cost of servicing the debt, as I said earlier.

The government keeps telling us it is reducing overlap between federal and provincial levels. In fact, the government is transferring the debt and the bills without transferring the corresponding authorities and tax points.

For instance, the Department of Fisheries and Oceans will divest itself of its inland waters programs. In fact, this has been going on for some time in Eastern Canada. Why not transfer authority over the fisheries outright, as requested by the provinces concerned?

The government has not withdrawn from areas under provincial jurisdiction or transferred the corresponding tax room to the provinces. There are still two departments of Health and two departments of Human Resources Development responsible for social programs in each province.

If the government had withdrawn from areas under provincial jurisdiction, it could have saved billions of dollars more on its operating expenditures, while at the same time eliminating costly overlap on the federal side.

The government wants to promote autonomy by eliminating direct subsidies to business. These subsidies, which total $3.8 billion today, will still add up to $1.5 billion in three years' time. Why not get rid of them now, since the business community and business groups, including the Conseil du Patronat du Québec, have been asking the government to abolish them outright?

The government also intends to charge fees for a number of government services. On paper this sounds great, but will charging every adult who applies for immigration to Canada a fee of $975 really reduce the deficit? Charging people this amount when they come here seeking a better life strikes us as mercenary, to say the least.

The budget proposes a 30 per cent reduction in dairy subsidies over the next two years. Quebec, which receives 50 per cent of these direct subsidies, will bear the brunt of this measure. Farmers in Western Canada whose subsidies are cut will receive compensation but not in Quebec.

We are also told that 45,000 positions in the public service will be cut in the next three years and yet this is barely enough to slow down the debt rate. The government says it is determined to be fiscally responsible, but the debt keeps growing as it did under Wilson and Mazankowski.

Why were positions not targeted for cuts in departments and organizations where there is an overlap with the provinces? A significant proportion of staff cuts will, in fact, be made in departments like National Defence and Transport, where there is no overlap with the provinces.

If the government was really serious about flexible federalism, it should have demonstrated its intention, when tabling the budget, to withdraw from areas of provincial jurisdiction. By remaining in these areas, it retains the right to impose its standards and its regulations.

Much greater cuts should have been made now, but more judiciously, so that less would have to be cut in the future and the deficit could be eliminated completely by 1997-98. This way, the cost of the public debt would not represent nearly 50 per cent of program expenditures as it will in 1996-97. The cuts planned for next year in transfers to the provinces and the cuts that will have to be made to programs in two years' time will hurt, but, unfortunately, they will serve only to maintain the cost of the public debt below $50 or $55 billion dollars at that time. Difficult decisions are always put off until later.

The main estimates for the Office of the Auditor General are down by 5.2 million dollars, a little over 10 per cent. The bulk of

this reduction, $4.4 million, results from the review of government programs, whereas program review is one of the cornerstones of government operations. Is this not somewhat paradoxical?

The budget of the Auditor General is cut when the role of this department is expanding, and the government is telling us that the Auditor General will publish as many as five reports a year. The existing legislation will have to be amended, in any case. It provides that the Auditor General may publish one annual report and three supplementary reports. Let us give the Auditor General the funds he needs to do his job, instead of cutting his budget as his role expands.

Main Estimates, 1995-96
Routine Proceedings

10:25 a.m.

Reform

John Williams St. Albert, AB

Mr. Speaker, I noted in the statement by the President of the Treasury Board that he says: "What I have just said shows that we didn't shy away from tough decisions" and "this government is committed to fiscal responsibility".

The government thinks it is just a case of more taxes, more taxes, more taxes. Then it says: "We're going to do some cutting all across the board". However, on looking at the estimates we find the spending of the government is going up again for the second year in a row. Of course the previous government did it every year before that.

Every year spending goes up. The government says it is cutting. It is cutting the programs it delivers to the people of Canada because the amount of interest paid on the national debt is getting out of control. That is why when we add the two together, spending goes up.

Let us get the job done. Let us get the budget balanced and let us stop the growth of interest during the first three years of this Liberal government. It is going to cut services to Canadians from $120 billion down to $108 billion. However the interest on the debt will go from $38 billion to $51 billion, which more than offsets all the cuts that are going to be made. That situation is going to continue. Spending will go up and services to Canadians will go down.

Main Estimates, 1995-96
Routine Proceedings

10:25 a.m.

Reform

Jim Silye Calgary Centre, AB

In their last year they will spend more money than in their first year: 158.7 to 158.

Main Estimates, 1995-96
Routine Proceedings

10:25 a.m.

Reform

John Williams St. Albert, AB

Mr. Speaker, we also find out about the great commitment for looking after social programs. The government is going to cut social spending by 7.3 per cent. If we look at the cultural programs, it is going to cut them by 6.9 per cent.

Let us get the priorities straight here. Surely we should be protecting the core of social programs and the cultural programs should be set aside until we get the deficit under control. Surely these are the types of things that a prudent manager would be focusing on in a government that is trying to do the difficult job of balancing the budget.

I noticed the Auditor General's budget is going to get cut by 10 per cent. He manages his department responsibly. He says he can do with 10 per cent less. He is the one that points out all the waste and mismanagement right across government. Surely if he can cut by 10 per cent, every other department could get cut by 10 per cent.

That is what the Reform Party has been saying all along. There are cuts; there is waste; there is mismanagement that can be done away with in departments without cutting social programs.

We find there are some increases however. It is not just cut, cut, cut all the way. Enterprise Cape Breton Corporation in eastern Canada gets an increase of 69 per cent, from $10 million to $17 million. It seems a little difficult to explain why one particular area, one particular minister in one particular department can receive an increase of 69 per cent when everybody else has to do with a little less.

The minister tells us he is going to transfer the freshwater management of fish to the provinces. We thought: "This is going to be great. Now we are going to see some downsizing in the department". However, in the Department of Fisheries and Oceans, spending goes up from $775 million to $896 million, an increase of $121 million in spending as it divests itself of its responsibilities.

Main Estimates, 1995-96
Routine Proceedings

10:25 a.m.

Reform

Elwin Hermanson Kindersley—Lloydminster, SK

There are no fish.

Main Estimates, 1995-96
Routine Proceedings

10:25 a.m.

Reform

John Williams St. Albert, AB

And there are no fish. However we do have 123 executives in that department. As we transfer and divest the responsibilities, the proposal does not call for any decrease in the number of executives. We have to get this straight. We start cutting at the top before we get down to the bottom.

We have talked about the other place that spends a lot of money. I see the estimates are going to give them even more money this coming year. It is a small increase but nonetheless it intends to spend more money in that other place. We have said to start at the top. Start with MPs' pensions. Start with the House of Commons, the Senate and so on.

There are a lot of unemployed people in this country. We need to help people create jobs and we find that $427 million is going to be spent on our Canadian identity. We would much rather spend this kind of money creating private sector jobs and reducing taxes than spending it to protect our Canadian identity that in many cases has withered away through the multicultural programs that we spend hundreds of millions of dollars on.

Last fall the President of the Treasury Board said that we would have to wait until the budget was announced before he would give us a report on the money we spend on special interest groups. I did not hear anything in the budget yesterday about special interest groups. Another half a billion dollars of government money is being wasted. We could have cut in that area rather than cutting back on the core social programs.

We have a bad record on megaprojects. The Lloydminister heavy oil upgrader cost over $500 million and was supposed to be a great deal. We bailed out of that a couple of months ago and sold our $500 million interest for $42 million. Not good business. With the Regina heavy oil upgrader we walked away from our loan guarantee at a cost of $125 million. Hibernia, the biggest one, is now going to cost $5.8 billion. This government is going to put in $3.6 billion, 62 per cent of the cost and we are going to have 8.5 per cent of the equity.

We have major problems in the way this government runs the finances of this country. When we go through these estimates we are going to find many things. We are going to tell Canadians about the waste, the mismanagement, the protection of jobs at the top and the elimination of jobs at the bottom. We have to tell Canadians what this government is doing. Over the next few months we will be raising these questions at committee.

Main Estimates, 1995-96
Routine Proceedings

10:30 a.m.

York Centre
Ontario

Liberal

Art Eggleton President of the Treasury Board and Minister responsible for Infrastructure

Mr. Speaker, pursuant to Standing Orders 81(4) and 81(6), I move:

That the main estimates for the fiscal year ending March 31, 1996 laid upon the table on February 28, 1995 be referred to the several standing committees of the House as follows:

Since the list is rather lengthy, I would ask that it be printed in Hansard at this point without being read.

Main Estimates, 1995-96
Routine Proceedings

10:30 a.m.

The Acting Speaker (Mr. Kilger)

Is it agreed?

Main Estimates, 1995-96
Routine Proceedings

10:30 a.m.

Some hon. members

Agreed.

(Motion agreed to.)

Petitions
Routine Proceedings

10:30 a.m.

Reform

Jan Brown Calgary Southeast, AB

Mr. Speaker, I rise before this House once again to present the 17th petition in this course of action undertaken on behalf of constituents who wish to halt the early release from prison of Robert Paul Thompson. April 11, 1995 is the date set for the parole hearing.

The petitioners I represent are concerned about making our streets safer for our citizens. They are opposed to the current practice of early release of violent offenders prior to serving the full extent of their sentences.

The petitioners pray that our streets will be made safer for law-abiding citizens and the families of victims of convicted murderers.