House of Commons Hansard #134 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was budget.

Topics

Government Response To Petitions
Routine Proceedings

10 a.m.

Fundy Royal
New Brunswick

Liberal

Paul Zed 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 nine petitions.

``Getting Government Right-Governing For Canadians''
Routine Proceedings

10 a.m.

Hull—Aylmer
Québec

Liberal

Marcel Massé President of the Treasury Board and Minister responsible for Infrastructure

Mr. Speaker, on behalf of the government, I have the honour to table, in both official languages, a document entitled "Getting Government Right-Governing for Canadians".

``Program Expenditure Detail: A Profile Of Departmental Spending''
Routine Proceedings

10 a.m.

Hull—Aylmer
Québec

Liberal

Marcel Massé President of the Treasury Board and Minister responsible for Infrastructure

Mr. Speaker, I also have the honour to table, in both official languages, a second document entitled "Program Expenditure Detail: A Profile of Departmental Spending".

A message from His Excellency the Governor General transmitting Estimates of the sums required for the service of Canada for the fiscal year ending March 31, 1998 was presented by the Hon. the President of the Treasury Board and read by the Speaker of the House.

Main Estimates, 1997-98
Routine Proceedings

10 a.m.

Hull—Aylmer
Québec

Liberal

Marcel Massé 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. These documents will be distributed to the members of the standing committees to assist in their consideration of the spending authorities sought in Part II of the Estimates.

1997-98 House Of Commons Estimates
Routine Proceedings

10 a.m.

The Speaker

I have the honour to lay upon the table the expenditure plan in relation to the 1997-98 estimates for the House of Commons.

Main Estimates
Routine Proceedings

10 a.m.

Hull—Aylmer
Québec

Liberal

Marcel Massé President of the Treasury Board and Minister responsible for Infrastructure

Mr. Speaker, it is my pleasure to table the Main Estimates of the Government of Canada for the 1997-1998 fiscal year.

In 1993, the Red Book stated: "We will exercise unwavering discipline in controlling federal spending and will reorder current spending priorities to make sure that maximum return is obtained on each investment".

These estimates mark the turning point: the point where we regain control over government spending. The point where we deliver public services adapted to today's reality.

As we promised in 1993, we are working to put the country's financial house in order. The main estimates I am tabling today contain expenditures that are closer to our means.

We are fully committed. We have worked hard and we are on the verge of achieving our objectives.

In the span of four years, we have significantly reduced the deficit, we have built a more efficient public service. We are working to deliver quality services to all Canadians.

For example, this year, Revenue Canada will process several million tax returns, and it will do so in less than 10 days.

Environment Canada has rationalized its approach. The number of weather offices was reduced from 71 local offices to 17 regional offices. This was made possible by better use of modern equipment and technology. Weather information and services provided to Canadians will be improved.

By the end of the current fiscal year, the percentage of the gross domestic product allocated to federal programs as a whole will be the lowest it has been in almost 50 years. Government program spending will account for only 11.9 per cent of the gross domestic product in 1998-99 as opposed to 16.8 per cent in 1993-94.

Since it assumed responsibility, this government has reduced the federal government's expenditures from $120 billion to $106 billion.

As we promised, we have changed the way in which we govern even as we continue to put public finances in order. We took up the fight and we will win the battle to provide our citizens with quality government.

The people of Canada elected us because they had confidence in us and believed, with just cause, that we could succeed. Our expenditure plan will live up to their expectations, but we still have a long way to go to transform government. This year we can achieve our financial goals without announcing any new reductions.

I left the public service and decided to enter the political arena in order to protect the financial future of our country. I was already dreaming of the day when I would be part of the birth of a new culture of public financial management.

In December 1993, I said: "Over time, governments collectively have promised more than they could deliver- and delivered more than they can afford". Today marks a turning point in the history of the administration of public finance in Canada. We have examined our financial situation, made firm decisions, and taken action to achieve our objectives. We have governed strongly and wisely.

But make no mistake: the battle has not yet been won. To relent would be to stray from the path that we have set. We are readying ourselves to enter the 21st century on sound and solid footing.

In February 1994 I told hon. members that we had to undertake an in depth review of the roles and responsibilities of the federal administration so that we could give the country a government equipped to meet the challenges of the 21st century.

Program review has been the cornerstone of our strategy. Thanks to this unprecedented exercise, we have been able to achieve our deficit reduction targets, to improve the delivery of services to Canadians and to clarify the role of the federal government in a number of areas.

We have reformed the system of expenditure management. We have inaugurated an ongoing program review, and soon will be in a position to provide public services within our financial limitations. We have created a stable long term planning framework for the departments.

The program review has, among other things, led us to the conclusion that, at the close of the 20th century, the state did not need to be the owner of railways, airports, or even the St. Lawrence Seaway in order to serve the taxpayers' interests. It enabled us to more clearly define the areas in which the government can best be involved in co-ordinating the actions of all citizens.

The main focus of public administration must still be the pursuit of program excellence and quality, in keeping with our means and with the needs of all of our fellow citizens.

Our mission has been developed without ever losing sight of the goal of enhancing the measurement of outcomes and of accountability. We are still faced with the challenge of maintaining a culture of state administration which supports constant improvement.

To that end, we have put in place a number of initiatives.

In partnership with industry we have eliminated half of the administrative irritants identified by small businesses. By next September, Veterans Affairs Canada for instance will have cut the time it takes to process an initial disability claim in half. All of this has been done while in fact spending less than we had predicted.

While reducing costs and providing quality services to Canadians, we are preparing partnerships with the provinces, the private sector and the NGOs.

The Canada infrastructure program is one example of a successful partnership.

Another is the transfer by Transport Canada last November of its civil air navigation services to a private sector not-for-profit agency, which today employs 6,000 former public servants.

Not only must program delivery reflect today's reality but most important, it must meet the needs of Canadians. Soon Canadians will be using more of the new information technologies to deal with government. This is a more economical, more efficient approach that will be accessible to Canadians at any place and at any time. The government would like to develop cost recovery more fully; however, we will move forward cautiously to avoid obstacles that might unduly inhibit the competitiveness of companies or the access of Canadians to services.

This tool will lead to a change of attitude in both public servants and those who pay user fees. Departments will have to better tailor their services to users' needs.

Thanks to the determined support of the public servants who have been behind our undertaking for the past four years, we have made considerable progress. Thanks to their innovative nature, these public servants have proven their ability to adapt rapidly to change, while keeping firmly in sight the objective of the pursuit of excellence and the delivery of quality services.

Canada has an administrative system that is the envy of the rest of the world. Yet we cannot rest on our laurels. The constantly and rapidly evolving world economy demands greater efficiency and greater rationalization of our operations.

Our public administration had become too unwieldy over the years. The governmental machine had multiplied its areas of intervention, and had built cumbersome and costly structures. After reviewing the functions of the state, we were forced to reduce its size.

However, we are treating our employees with civility and respect as we move through the public service reduction process. Accordingly, we established the early departure incentive program, called the EDI, and the early retirement incentive program, or ERI, both of which offset a number of the consequences of staff reductions.

The number of federal public servants has gone from 225,000 down to 195,000 between April 1995 and December 1996.

We all want a modern and dynamic public service. We also want a quality public service. We cannot afford to be left behind, nor to let events overtake us. Accordingly, we have introduced a series of measures and strategies to address this issue. The program known as "La Relève" is the catalyst for building a modern and dynamic public service.

The return to collective bargaining is another important step for the government. I look forward to successful negotiations with the unions. We are expecting a great deal from these negotiations. We are looking for financial accountability. We are looking to establish the concept of total compensation and we are looking at transforming the public service.

Canada deserved a new way of managing public affairs. We have a vision of the future that is shaped by the need to move forward with pride.

I do not need surveys to know that Canadians are happy that their financial independence is within reach and that they will soon be free once again to choose the type of society they want.

Our vision held true as we improved results, assessment, transparency and accountability. These changes mean that we can establish a new public service culture in the best interests of all Canadians.

We still have much to do, but I am proud of what we have already accomplished.

The House will recall that last March we introduced, on a pilot basis, a new format for six of the Part IIIs of the Estimates.

In October, I also tabled performance reports for 16 departments and agencies. These reports provided the House with more detailed information on the results achieved. And they brought this information to members six months earlier than if we had waited for the tabling of the traditional Part III. These documents were well received and appreciated. They reflect our efforts to improve the information we present to Parliament. We have therefore decided to continue with the initiative this year.

The 16 departments and agencies have prepared outlook documents, entitled "Plans and Priorities", which I am tabling as their

Part IIIs. They are the outcome of discussions with members of the House and the auditor general.

I would like to thank all of them for their valuable contribution, especially the member for St. Boniface and the members of his working group.

As further good news for Canadians, I am also making public today another document: "Getting Government Right-Governing for Canadians".

This document-which is close to my heart-is a report on the current status of government reform, as well as a description of the action we will be taking to achieve our goals.

We promised to create quality government. Canadians can be proud of their government. We have kept our promises. We are back on the right path-the path to cost-effectiveness and to quality.

Main Estimates
Routine Proceedings

10:20 a.m.

Bloc

Richard Bélisle La Prairie, QC

Mr. Speaker, as the minister said a few minutes ago, in 1997-98, the federal government will budget nearly $106 billion for program spending, 2.9 per cent less than in the current fiscal year.

In his speech, the President of the Treasury Board seems to be looking at the world through rose coloured glasses, and what he says is far removed from the experience of thousands of public servants who have been laid off or whose professional future is uncertain.

Take, for instance, the situation at the cheque printing centres, where employees, non-unionized and in a vulnerable position, were given the choice of accepting a 40 per cent drop in salary or staying home, when their service was privatized.

The minister's self-congratulatory tone is hardly appropriate, considering the unemployed who are getting poorer because their benefits were cut as a result of unemployment insurance reform, while today, the Minister of Finance is using the UI fund surplus to reduce his deficit artificially.

The minister tells us, and I quote: "We are working to put the country's financial house in order". How can the minister say that when we know that 50 per cent of spending cuts represent cuts in transfer payments to the provinces? Similarly, putting the country's financial house in order explains only 21 per cent of spending cuts, in other words, $1 out of every $5 committed by the government.

The minister went on to say, and again I quote: "In the span of four years, we have significantly reduced the deficit". What the minister should have said in the House this morning is that, in addition to the provinces, the unemployed have also significantly reduced the deficit, when we realize that the other major weapon in the battle against the deficit is the unemployment insurance fund.

The minister also said: "This year, we can achieve our financial goals without announcing any new reductions". However, as a result of cuts in transfer payments, the provinces will have to cut funding themselves and do the minister's dirty work.

Of this $14 billion in spending cuts, only $3 billion is directly the result of spending cuts within the federal government. Does the absence of new reductions mean the end of federal house cleaning before the election?

Making the provinces pay and thus take the blame for spending cuts in health care, education and social services and making the unemployed pay as well, is that the beginning of a new culture in public financial administration the minister has been bragging about?

The minister also said the government was treating its employees with civility and respect as it moved through the public service reduction process. Where is the civility and respect in refusing, as the minister himself did, to invest the $18 million required to align the federal employee drug plan with the plan under which all Quebecers will be covered once the Rochon plan is in place?

In Quebec, maximum insurance coverage is $760 per year. This means that federal employees who suffer from a serious medical condition will have to pay 20 per cent of their drug costs however high they may be, which could amount to thousands of dollars every year.

In response to a question on this particular situation, the minister told this House only 2 per cent of federal employees living in Quebec may be affected. If so few of them are affected, why not put them on an equal footing with the other 98 per cent, those who are blessed with better health?

The minister added that, between April 1995 and the end of December 1996, the federal public service shrank from 225,000 to 195,000 employees. We will have to check how much contracting-out the government did during the same period, especially now on the eve of a federal election.

This old Liberal habit of spending money they have not earned yet is obvious here. Where is this financial independence the minister is referring to when he tells us, as he did a moment ago, that he does not need polls to tell him that Canadians are pleased with regaining their financial independence, when the accumulated debt is $600 billion? The only good news is that the debt collector is no longer knocking at Canada's door? Thanks to the contribution of the unemployed and the provinces, the threat of bankruptcy and insolvency is not as imminent as it was four years ago.

Go ask the unemployed, those who despaired of ever finding work and dropped out of the labour market altogether, and the provincial finance ministers. Where is the financial independence the minister is boasting about this morning?

Here is an example of this old Liberal habit-one might even call it an atavistic trait-to spend other people's money.

At page 2-14, Part III, of the 1997-98 Estimates, we read the following:

The government is considering obtaining four UPHOLDER class submarines from the Royal Navy.

I hope Canada is no longer buying the old tubs that the British Navy wanted to get rid of a few years ago. It goes on to say:

Delays in approving this project resulted in expenditures which were paid through the operating budget, to support an additional program to overhaul OBERON class submarines.

There is also $8.6 million to buy a patrol frigate by March 1997; $61.3 million to buy sophisticated air-to-surface missiles. However, as regards spinoffs for the Canadian industry, the defence department document says: "Since the weapons, pods, testing material and spare parts will be bought through the American government, the Canadian industry will not be directly involved in the contracts".

In other words, this document, the Estimates, is drafted in Canada, but benefits the American industry.

Meanwhile, the minister is proud of these results.

Granted, the minister is an intelligent person. However, he does not live in the same world as we do, he does not live in the same world as Canadians do. That is the tragedy.

Main Estimates
Routine Proceedings

10:30 a.m.

Reform

John Williams St. Albert, AB

Mr. Speaker, I am pleased to respond to the President of the Treasury Board's tabling of the estimates this morning. I think that we have to point out that not everything is as clear as he would like us to believe. I refer to his speech in which he said "we will exercise unwaivering discipline in controlling federal spending". That is a wonderful statement.

When I looked at the Globe and Mail last week I happened to see an article that said ``next week's government spending estimates will prove the ad hoc and very political nature of the heritage minister's eleventh hour $10 million gift for CBC because the money won't be there''. Guess what, I checked the estimates and the money is not there. There is a little column for last minute add-ons for the political changes made by cabinet and sure enough we find that the heritage minister at the very last minute, after the estimates were printed, was able to squeak in another $10 for her little favourite programs. So much for the unwaivering discipline in controlling federal spending. Obviously it is completely and totally subject to the whims of the people who have power around here. Therefore we have to take a look at the political nature of the rest of the documents to see what else we have found.

The President of the Treasury Board goes on to talk about the fact that the percentage of program spending is going to be the lowest in GDP for almost 50 years, but again he completely fails to tell us about how much money in addition to program spending we are paying in interest. Canadians have to take out $45 billion to $50 billion a year of their pockets to pay for interest for the past mistakes of this government and the previous government. The Tories and the Liberals combined for the last 25 years have been spending with abandon. Now Canadians have to come up with $50 billion a year or the better part thereof just to pay for these mistakes. They were not their mistakes, they were the government's mistakes but guess who gets to pay. And that is the shame of these estimates.

What else did we find in the president's speech: "Over the last few years the federal public service has grown too large and therefore we have to make it smaller". A wonderful statement but what do find? Let us take Nav Canada. Again in his speech he referred to the fact that he has transferred 6,000 former federal employees into this hybrid crown corporation, not for profit organization, hid from the auditor general organization; 6,000 federal employees and he claims he is reducing the public service.

Not one person lost their job. It was a transfer from one department into a not for profit agency. Nothing changed. Yet he would have us believe that he is downsizing the federal civil service, that we are getting more efficient and that we can manage our money better. Wrong. Completely wrong.

We saw the Minister of Finance stand up in this House and heard him boast about his accomplishments, how he has brought down spending, how he has brought it under control and how we are finally getting the federal government's fiscal house in order.

When we look at it, we find that the federal government is getting its house in order again at the expense of somebody else. Remember how I said that the taxpayers have to pay for the government's mistakes. We are also finding that provincial governments are now paying for the federal government's saying it is getting the job done. The health and social transfer to the provinces is how it is doing it.

Last year the federal government transferred to the provinces $14.9 billion for health, education and social services tax. This year it is only going to spend $12.5 billion. That is a reduction of $2.5 billion right there that did not reduce the size of the federal government one inch.

It did not reduce the number of civil servants by one. It was a case of passing the buck to the provinces and saying "you will do with less in order for us to balance our budget". Is that responsible

government? Is that the way we want to manage our federal government, by passing the buck to the provinces with $2.5 billion less while Canadians are saying "what about my health care, it has fallen to pieces"? Does it care?

It cares about the Minister of Finance's being able to stand up and boast about his accomplishments. We read in the paper and I see in Edmonton, where I come from, that people have been denied emergency services, that people have died because they have had to transfer from one hospital to another in an emergency. They died in the process because there was not a bed available for them.

This government is cutting $2.5 billion in cash from health and education. It says it is a good job. The other day the Minister of Finance stood up and said "Boy, am I good. I am going to throw another couple or three hundred million dollars back into health care. Is that not good news?"

Compare that to the cut of $2.5 billion from health care in one year. That is terrible news. Canadians ought to know what is really going on when it comes to this government's management of health care for Canadians. Abysmal. Downright abysmal.

We have also heard the Minister of Finance tell us about how interest rates have come down and how he is saving all kinds of money. Let us recognize that interest rates are down right around the world. They are down in Japan. There are practically non existent there. They are down in the United States. They are down in the United Kingdom. They are down all through Europe.

I wonder if the minister is taking credit for all that, too. The reality is he just happened to catch the benefit of a wave that was going around the world. Let us remember that interest rates came down not because the Minister of Finance caused it. He just happened to get the benefit of it.

This year we are going to see a reduction, finally, in the cost of our debt. It is going to drop by $1.8 billion, the prediction is, down to $46 billion. Let us remember that it was not the management of this government and it was not the management of this Minister of Finance that caused it.

Thankfully Canadians who have mortgages and loans with taxes to pay are getting the benefit of it. Again there are the seniors who would rely on their investment to give a little enhancement to their quality of life on top of the pittance this government gives them. What happened to their incomes?

I did not hear the Minister of Finance say seniors are going to be better off because interest rates are coming down. While he was boasting that someone with a big mortgage would save $500 a month, he did not say that the senior who has a $100,000 investment is going to lose $500 a month. I did not hear him say that, but that is what happened.

My hon. colleague is going to be retiring after the election. He is going to have to suffer because his investments are going to bring him less money. Does the Minister of Finance care? Perhaps not.

The point is there are hundreds of thousands of Canadians across this land who are being squeezed by the reduction in interest rates, squeezed by taxes going up, squeezed because health care is not there for them, all because the Minister of Finance says "boy, am I doing a great job". Canadians know he is not doing a great job. They know that their jobs are potentially in jeopardy. One in four Canadians is concerned about a job. There are 1.5 million unemployed who are looking for a job, and high taxes are destroying these opportunities.

University graduates are asking how to get a job. The Minister of Finance is saying they will have an extra six months to before they have to start to repay their student loans. Let me assure the House that each and every one of them would rather have a job opportunity than an opportunity to defer the payment of a student loan. But these are the types of things that are going on that we do not hear about. We did not hear it in the government's tabling of the estimates.

I refer to the people in power seeming to be able to get what they want. In a stack of documents I have here there is a little interest in what is going on in the department of heritage. If I remember the numbers clearly, while the Minister of Finance says: "I am squeezing everybody, everybody is having to do with less", does anybody get more? Yes, the Deputy Prime Minister and the minister of heritage gets more. I think she gets about $90 million more, an 8.4 per cent increase in her budget.

Main Estimates
Routine Proceedings

10:40 a.m.

An hon. member

Her Canada pension payments.

Main Estimates
Routine Proceedings

10:40 a.m.

Reform

John Williams St. Albert, AB

Not her Canada pension payments, it is for the little programs she wants, the CBC, $10 million; flags for everybody, another few million dollars; the information office, $20 million. She gets what she wants and everybody else has to do with less.

She is on the left side of the party and she thinks government exists to spend money, government exists to manage the economy and manage people's money properly. She does not even know what that means. That is why these estimates fall in hard behind the budget. It tells us that Canadians are being duped by the government.

The other thing I want to point out is the smoke and mirrors. The Minister of Finance said that program spending is coming down and we are finally getting a handle on this. But let us take a look at the numbers. CRTC's budget in the main estimates is down by $18 million, from $22 million to $3 million. Wow, what is going on here? I checked into it and I found that the revenues that were collected have been netted against the expenditures for the depart-

ment. Therefore rather than showing the $22 million which is normally spent, the revenues have now been netted out and they are down to $3 million. But it is still going to spend $22 million.

So what has changed other than the numbers on the piece of paper? The facts are that the way the numbers are presented would lead one to believe that major progress is being made. But when we ask the questions behind it, we find that is not the case. That is the story of the government. That is the story everywhere.

It does not matter if the department of heritage states at the last minute that it wants another $10 million out of taxpayers to get their favourite programs on TV. It does not matter if it is the President of the Treasury Board who stands and says that civil servant numbers are coming down. He is just moving them off the balance sheet. It does not matter if the Minister of Finance stands up and says that interest rates are coming down because of his great management. That is also wrong.

I could go on and on. The point is that the election is coming up and Canadians will have a real choice between the fiscal responsibility and management by the Reform Party and the fiscal irresponsibility by this government.

Main Estimates
Routine Proceedings

10:45 a.m.

NDP

Len Taylor The Battlefords—Meadow Lake, SK

Mr. Speaker, on a point of order. I am wondering if I might have unanimous consent to reply on behalf of the New Democratic Party to the tabling of the estimates.

Main Estimates
Routine Proceedings

10:45 a.m.

The Acting Speaker (Mr. Milliken)

Is there unanimous consent?

Main Estimates
Routine Proceedings

10:45 a.m.

Some hon. members

Agreed.

Main Estimates
Routine Proceedings

10:45 a.m.

Some hon. members

No.

Main Estimates
Routine Proceedings

10:45 a.m.

The Acting Speaker (Mr. Milliken)

I hear nos.