House of Commons Hansard #149 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was budget.

Topics

The Budget
Government Orders

10:25 a.m.

Reform

Werner Schmidt Okanagan Centre, BC

Mr. Speaker, the hon. member for Lethbridge mentioned a lot of things about Quebec, the Constitution, the security of Canada and unity. Those are very significant issues. However another area that has been of concern to me has to do with the promise to create jobs.

Could the member give us some examples of measures in the last two budgets which gave encouragement to young people in the area of job creation?

The Reform Party, with its fresh start program, is telling young people that there is hope. There is a vision for Canada which will give them job security, stability and hope. It will give them the things they want for their families and their future.

Could he say a few words about that?

The Budget
Government Orders

10:25 a.m.

Lethbridge
Alberta

Reform

Ray Speaker Lethbridge

Mr. Speaker, I reiterate a point I made earlier. If the Liberal government had been elected with a plan to reduce the deficit and bring forward a balanced budget during the 35th Parliament, there would have been a greater amount of stability in the Canadian economy and a greater amount of confidence in the nation.

The 1997-98 budget could have been a balanced budget.

If that happened, the confidence of the investors in Canada would have been greater. We would have had investment in all kinds of small and medium size business across this nation.

The consumers of Canada who would have been more secure in their jobs would have been ready to spend money and buy. However, the problem is confidence is not there. The Minister of Finance stands in the House and says interest rates are low.

We remember what happened in the 1970s when interest rates ballooned into the 18 to 23 per cent range and there was a floating interest rate that a small company or as a small businessman or a farmer took out. It devastated their business. It took all the cash flow and we are scared that that could happen again. This government has not come to grips with its finances. The confidence level in this country is horrible even though it has been glazed over by a good media communications plan by the Minister of Finance.

That is not going to hold water very long. If the interest rates in United States start to increase, we know the Canadian interest rates are going to follow. That, in turn, is only going to reduce the confidence of the investor and the consumer.

That leaves our young people, 25 per cent between the ages of 18 and 25, who are now currently unemployed in a very unstable condition. We must deal with our budget in a more responsible way.

The Budget
Government Orders

10:30 a.m.

Reform

John Cummins Delta, BC

Mr. Speaker, four years ago I came to this place excited at the prospect of trying to affect some change here. At that time, I shared the enthusiasm of my fellow Reformers for fiscal prudence and for promoting the notion of fiscal prudence and some sort of social responsibility. As well, I came with an interest in the fishery, especially the fishery on the west coast.

Canada's fisheries represent a valuable national resource. The responsibility for that resource is vested in the federal government. It is a constitutional responsibility, one that the federal government cannot ignore. Yet this government has failed miserably in that regard.

It has ignored the best advice of the Supreme Court of Canada. It has ignored countless participants and shareholders in the fisheries who have attempted to offer good and solid advice to the government. Most curiously, it was ignored by a former Speaker of the House whom this government appointed to conduct a review of the Fraser River fishery in 1994.

Why I bring this up in the context of the budget is that the federal department of fisheries has a budget this year approaching $1.2 billion. We are not talking peanuts here. We are talking about a huge budget, one which is not spent wisely and one which puts this valuable natural resource at risk.

Mr. Fraser in his comments suggested the same: "DFO must formulate a strategy and a plan that will marshal the personnel, facilities, equipment and communications systems needed to re-establish a credible enforcement deterrent. The first step in the process must be a proper assessment of what is required at minimum to ensure adequate enforcement. This cannot be achieved in the context of a budget exercise".

What the former Speaker was saying was that when there is a department like fisheries and oceans with a constitutional responsibility to protect a national resource, we cannot simply take the accountant's view and start slashing at the budget. We first have to determine what is needed to protect that resource and go from there. In managing the budget this government has not done that.

That is not to say, necessarily, that we are standing here saying that more money must be spent. What we are saying is that a proper assessment must be taken of what is needed. We must ensure that the moneys spent are spent wisely.

In 1994 the government reaffirmed its support for something known as the aboriginal fishing strategy. This was a strategy that established a racially segregated fishery on the west coast which the previous government said was an obligation as a result of a Supreme Court decision and Sparrow. This of course was false.

Nevertheless, a mid-term review was conducted of this program in 1996. In that mid-term review it was noted that reallocation of money from within DFO to the aboriginal fishing strategy starved the real needs of the department such as enforcement.

What we have here is an abuse of priorities. Where the key priority must be enforcing regulations and laws and protecting the resource, the government in its wisdom took money from that critical area and put it into an area which came about as a result of a political need rather than a constitutional need.

Within a year of coming to power, the government reaffirmed its support for this aboriginal fishing strategy and approved the continuation of AFS commercial sales projects and allocated money away from key enforcement areas. This is totally unacceptable.

DFO auditors went over the results of the mid-term review and they noted two things. The first thing they said is that it was difficult to get an overall sense of what had been accomplished through the expenditure of almost $100 million over four years. That $100 million was spent on this aboriginal fishing strategy.

The auditors went on to say that most of the examples used in the document contained no hard data, thus they had no way of knowing the magnitude of the project, whether it was cost effective or how the results were determined.

The government asked Mr. Matkin, former head of the B.C. business council, to conduct a review of this aboriginal fishing strategy. The review was completed toward the end of January and

the government promised that this review would be made public. We are still waiting for the publication of that review.

At the same time as we are waiting, it is preventing the government from doing its job and that is preparing for the upcoming fishing season. In a draft of the Matkin report, Mr. Matkin noted that these pilot sales programs were in a rut and that something must be done. Yet again we are waiting and waiting for something to come about here.

The government further spent money on another study, a study which would deal with the coast wide implications of using the Nisga'a treaty as a model for treaties which would be established coast wide and the impact of using that treaty as a model, especially with this fisheries component. In other words, what is the cost of replicating the Nisga'a treaty coast wide to the commercial fishing industry?

Over a year ago we applied under access to information to get a copy of that study. It took 12 months. The Department of Fisheries and Oceans, in its wisdom, refused to release anything to us, not even the cover page of that 98 page document. We are still working through access to information to get it. What does the department have to fear from the public understanding of what it is doing and what the cost is going to be in settling these treaties?

My colleague from Fraser Valley East has also asked the department for a study it did on the Sto:lo and their budget. He still has not been able to get that. There was a May report, again commissioned by the department. We are waiting for action on that. It is yet to happen. This report was delivered last December and we are still waiting.

As I said, the department spends about $1.2 billion a year. There is no denying that the problems it faces are complex. Unfortunately the department has not measured up to the job. Time is running out for Parliament to examine the workings of this department and yet examine it must.

Last fall a federal court judge accused the department of a litany of corrupt behaviour which included vote rigging and sham consultative process. This had reference to dealing with the establishment of a halibut quota system on the west coast.

The federal court judge noted: "A DFO official's unwillingness to face the obvious meaning of his own words caused the court to doubt the reliability of the evidence offered in defence of the minister's, DFO's, and his own position". This is a tremendous indictment of the department. The judge went on to say: "Rules were simply broken because it was necessary to do so to reach the planned objective".

The minister has refused to this point to dissociate himself from the action of the official named by the court.

If the federal court of Canada can come down with an indictment of the Department of Fisheries and Oceans with the intensity it did last fall, why should I or why should the Canadian public have any confidence in the ability of this department to manage this huge budget? It is an issue that needs to be addressed and addressed quickly by this House.

The Budget
Government Orders

10:40 a.m.

Reform

Ted White North Vancouver, BC

Mr. Speaker, I found the member's speech very interesting because it dealt with an area of waste in the budget where there seems to be no control and no accountability, and the auditor general is very concerned about spending in the whole range of activities of the Indian affairs department.

I would like to ask the member about fishing rights and the cost of those exercises, those legal situations that are occurring on the Fraser River now. I realize he may not be able to speak in much detail about cases. Has he any idea of the cost to Canadian taxpayers for the constant intervention of officials of the Department of Fisheries and Oceans in enforcing what are probably illegal regulations that give fishing rights to a specific group over another group? Yet these officials will keep spending taxpayers' money and forcing regulations that could be illegal and then not carrying them through to get a court ruling to actually prove whether they are legal.

The Budget
Government Orders

10:40 a.m.

Reform

John Cummins Delta, BC

Mr. Speaker, I thank my friend for the question. The cost to the Canadian taxpayer for these court cases has been absolutely remarkable. We know that just the operation of this fishery which is operating beyond the law with the consent of the minister has cost Canadian taxpayers well over $100 million in the last few years.

The actual legal costs to the government I cannot recall at the moment. I do know that industry has spent over $1 million of its own money representing itself in an intervener status in pursuing these cases through to the Supreme Court of Canada. That is a huge amount of money.

What is most serious about it is in focusing its energies on this issue, the department is not able to manage the resource for other fisheries. I have an example at hand here right now which we are currently petitioning the minister about. That has to do with the eulachon fishery in the Fraser River. It is a small fishery. There are probably only 25 to 35 participants in it in any one year. This year there were 20 tonnes allocated to that eulachon fishery on the Fraser River.

Because the department could not get a management plan in place to operate this fishery it shut it down this year. It shut it down in spite of the fact that the participants committed that they would pay for an observer to monitor the fishery so that it would not go over the total allowable catch and so that it would not cost the

department any money. Yet the department has refused. It has shut down that small fishery this year and said it cannot fish because the government cannot get a management plan in place.

How outrageous is that? It is like saying to a farmer "you cannot plant your crops because there may be a snowstorm in the Fraser Canyon that is going to prevent the trains from getting to the coast". It is absolutely outrageous. Yet this is the kind of thing that goes on in this department time after time. Time permitting, I could give the House example after example just as outrageous as this one.

The Budget
Government Orders

10:45 a.m.

Reform

Werner Schmidt Okanagan Centre, BC

Mr. Speaker, I would ask my hon. colleague to explain an area that he probably has not touched on directly, but I think ties into the categories of fisheries which have apparently been created.

I wonder whether within this mismanagement, this lack of planning, there is some sort of perpetuation of inequality among Canadians, of one group of Canadians getting one kind of advantage at the expense of others.

In the time that is left, I wonder if the member could talk about that a little bit because I think equality before the law is a very significant issue. It attacks the very unity of the country.

The Budget
Government Orders

10:45 a.m.

Reform

John Cummins Delta, BC

Mr. Speaker, no doubt the inequality promoted by the aboriginal fishing strategy has driven wedges between communities which have been able to get along for the last 100 years. There was harmony, people worked and played together and now wedges have been driven between these communities.

The industry has no faith in the department. In fact, it has been treated better by the courts than by DFO in the past. Many in the industry say it is preferable to litigate because the courts hear and take into account the arguments of non-aboriginals when dealing with the issue, something the department has refused to do.

The Budget
Government Orders

10:45 a.m.

Liberal

Beryl Gaffney Nepean, ON

Mr. Speaker, on February 18, my hon. colleague, the Minister of Finance, presented the government's 1997 budget, its fourth budget. I am pleased to speak on this budget. I will be sharing my time with the member of Parliament from Erie, Ontario.

It is a budget for all Canadians. It is a budget that works. It is a budget that stays the course. It stays the course in a manner that is seeing the deficit fall, but remains true to the ideals that Canadians hold dear. Through this budget the government has not only ensured but strengthened the social safety net for this generation of Canadians and for generations of Canadians to come.

The 1997 budget proposes selective tax cuts for low income families, charities, the disabled, students and workers pursuing higher education, and for parents saving for their children's future educations. But it is not yet feasible to consider a broad based tax cut. When the government does so, it will ensure that a tax cut is affordable and sustainable. Broad based tax cuts would be too costly at this time. They would require additional spending cuts or an increase in the deficit. Neither of these options are acceptable to the government.

The budget continues on the course of putting Canada's finances in order in a manner that is measured, deliberate and responsible. This is an approach that is giving Canadians control of their own finances.

Financial requirements will be eliminated by 1998-99. This means that the government will not have to borrow any new money from financial markets that year for the first time in 19 years. We are restoring self-sufficiency.

Keeping inflation low and progress in deficit reduction have paved the way for dramatic declines in Canada's interest rates. In the past three years Canadian short term rates have fallen close to 5.5 percentage points, the lowest levels in close to 35 years.

By creating a favourable economic environment, the government has enabled Canadians to save thousands of dollars a year on their mortgage payments and the benefits to small business have been even more dramatic. Let me give an example. On a $1 million loan with a 10-year amortization and monthly payments, a small business would save approximately $33,395 over comparable payments in 1995.

It is true that lower interest rates take time to stimulate the economy. However, developments in late 1996 show that the lower interest rates are beginning to stimulate growth. Let me give two examples. Housing sales soared in late 1996, stimulating strong gains in new home construction. This is very evident in the riding of Nepean. Sales of consumer goods have risen strongly, led by motor vehicle sales.

As demand has grown, so too has job creation. In the last five months 61,000 jobs have been created by the private sector, the majority of which are full time jobs.

The government is not alone in its optimism. It is shared by consumer, by businesses and by private forecasters alike. Consumer confidence has risen for four quarters in succession. Business confidence is at a record level with more businesses than ever believing that, now is a good time to invest.

Canadian forecasters expect the economy to grow by 3.3 per cent in 1997 and by nearly 3 per cent in 1998. They expect the economy to create between 300,000 and 350,000 jobs during 1997 with similar results in 1998. That is good news. Even international

forecasters are impressed with Canada's achievements. The OECD expects Canada and the U.K. to lead the G7 nations in growth for 1997 and it expects Canada alone to lead the G7 in job creation this year. The IMF also paints a rosy picture of Canada's economic outlook.

While the budget is helping to create a climate for long term jobs and growth, the government is also investing in immediate job creation, bridging the gap to the stronger growth that will result from lower interest rates. Through the Canadian infrastructure works program, the government has provided $2 billion in partnership with municipalities and provinces for $6 billion worth of investment in 12,000 different projects right across the country.

In the 1997 budget the government proposes to increase this commitment by an additional $425 million. When leveraged with municipal and provincial contributions, this could translate into approximately $1.8 billion worth of new investment and hence new jobs.

To further stimulate job growth, EI premium rates will be reduced by another 10 cents on January 1, 1998 and the new hires program will completely eliminate EI premiums this year for additional employees hired by almost 900,000 eligible small businesses. This reduction of payroll taxes will save both employers and employees, including those in Nepean, $1.7 billion in 1997. That is a very significant amount.

The budget invests in both the construction sector and needy households through a $50 million extension of the residential rehabilitation assistance program.

Tourism will get a further economic shot in the arm with a $15 million injection to the Canadian Tourism Commission. And $50 million to the Business Development Bank will help finance the private sector tourism infrastructure.

Neither is rural business forgotten. The 1997 budget provides $50 million to the Farm Credit Corporation to expand its capacity to support rural economic growth and diversification. Through the community access program, rural small businesses are being helped to plug into the Internet to the tune of $30 million over three years.

Another important initiative in the budget is the reduction of the paper burden for small business. Eligible businesses will be able to file quarterly rather than monthly. Then there are the budget measures that invest in long term job creation and growth. An important component of this long term strategy is the government's support for Canadian youth and for education and skills training.

In addition to the youth employment strategy, the funds for which were provided in the 1996 budget, federal assistance for higher education and skills enhancement will be enriched by $137 million in 1998-99. This allotment will grow to $275 million annually when the full impact of these measures come into effect.

Through the proposed education credit, the tuition credit and the carry forward of the unused portion of credits, the government has demonstrated its commitment to education. Students who need help repaying their loans will have their deferral period extended from 18 to 30 months. The loan repayment schedule will be tied directly to income in co-operation with interested provinces, lenders and other groups. The registered education savings plan contribution limit will double, and parents will be able to transfer unused RESP income into their RRSPs if their children do not pursue higher education.

No long term growth strategy would be complete without investment in innovation. Again, the 1997 budget proposes the creation of the Canada Foundation for Innovation. One of the main budget initiatives, the foundation will help to modernize research infrastructure at Canadian post-secondary institutions and research hospitals in health, environment, science and engineering.

The foundation will help Canadians be at the leading edge of research and technology developments which keep our industries competitive and create the jobs of tomorrow. It will encourage the best and brightest Canadian researchers to stay in Canada. It will assist in generating the kind of technology oriented graduates the future workforce will require. With its vibrant high tech sector, benefits such as these will be invaluable to the Nepean high tech community. The foundation will develop partnerships among educational institutions, research hospitals, business and non-profit sectors, individual Canadians and the provinces which could trigger approximately $2 billion worth of spending in research infrastructure.

These initiatives are all important for the creation of jobs and growth. However, if we lost our compassion in the process it would not be worth the price. I want to stress that the government has not lost its compassion in its fight to bring down the deficit. That is evident in the budget proposals that sustain and strengthen the social safety net. Included among these measures is $300 million which will be spent over three years to improve the delivery of health services to Canadians.

These announcements address a number of recommendations made in the report by the National Forum on Health. That includes $150 million for a health transition fund to investigate new and better approaches to providing health care, $50 million allotted over three years for the Canada health information system and $100 million over three years in additional funding to the community action program for children and the Canada prenatal nutritional program.

The federal government is also providing support for medicare and other social programs through the Canada health and social transfer.

While health is of prime importance, so too is the need to ensure our children's successful passage into adulthood. That is why the budget proposal for a national child benefit system is a major step forward.

Under the national child benefit system, the federal government will introduce an enriched Canada child tax benefit, while the provinces and territories will redirect some of their spending into improved services and benefits for low income working families. The proposal includes a two-step enrichment of the current child tax benefit to create a new $6 billion Canada child tax benefit by July 1998.

Canadians with disabilities have also been addressed by the budget. As well, charities have not been ignored.

In conclusion, we are staying the course on deficit reduction. We are investing in short term and long term strategies to stimulate job creation and growth.

The Budget
Government Orders

10:55 a.m.

The Deputy Speaker

I am terribly sorry to interrupt the hon. member, but her time has expired.

The Budget
Government Orders

10:55 a.m.

Reform

Ted White North Vancouver, BC

Mr. Speaker, the member talked about compassion and how wonderful the budget was because it had gone slow. I wonder if the member recognizes that presently the debt is $600 billion and the interest payment on that debt is about $50 billion, give or take, per year at present interest rates. If the interest rates go up by 1 per cent it will add $6 billion a year, 2 per cent will add $12 billion and 3 per cent will add $18 billion.

How compassionate will her go slow budget look when interest rates rise 3 per cent and we have to slash $18 billion more from social programs because her government went too slow?

The Budget
Government Orders

10:55 a.m.

Liberal

Beryl Gaffney Nepean, ON

Mr. Speaker, obviously the Reform member was not listening to my speech. We are a very compassionate government. We have dealt with all of these programs in a most compassionate way.

The deficit has to be reduced first. Once it is reduced then we can start on the debt. Until we get the annual operating budget in order, there is no way we can start on the annual debt.

He is quite correct in stating that if interest rates rise and if inflation rises, it would certainly hurt our ability to reduce our indebtedness, both through the annual operating deficit and the debt.

We are quite confident that we have our house in order. Interest rates are down and inflation is under control. Obviously, we are at the mercy of international markets. We hope that what he says will not happen. I really see it as being hypothetical.

The Budget
Government Orders

10:55 a.m.

Liberal

John O'Reilly Victoria—Haliburton, ON

Mr. Speaker, I want to congratulate the hon. member for her fine approach to the budget and the informative speech which she gave.

I wonder if she could elaborate a little on measures for the disabled which are in the budget.

The Budget
Government Orders

10:55 a.m.

Liberal

Beryl Gaffney Nepean, ON

Mr. Speaker, I thank the hon. member for giving me the opportunity to speak on persons with disabilities as I did not have time to do it in my speech. The proposed measures in the budget will allocate $230 million over three years to assist the disabled.

The list of expenses eligible for the medical expense credit will be broadened. We will eliminate the $5,000 limit on the deduction for attendant care expenses for disabled earners. Audiologists will be allowed to certify eligibility for the disability tax credit.

The definition of a preferred beneficiary of a trust will be broadened to include adults who are dependent on others because of mental or physical infirmity. The customs tariff will be changed to provide duty free entry for goods designed for use in this area. I could go on and on.

Hockey
Statements By Members

11 a.m.

Liberal

Raymond Bonin Nickel Belt, ON

Mr. Speaker, on last Wednesday we fought the annual page-MP hockey challenge. I wish to announce that the MPs have dropped their protest and assault charges against the pages. The MP team concedes that the winners of the game are the pages. The score was pages 7 andMPs 6.

We congratulate the pages and we thank them for organizing a fun evening. We also thank the fans who provided the moral support and entertainment between periods.

I would not want to end this statement before recognizing a key figure in the page victory, the referee, our hon. colleague, the government whip.

Health
Statements By Members

11 a.m.

Reform

Philip Mayfield Cariboo—Chilcotin, BC

Mr. Speaker, where are the priorities of the federal government? Since 1994 the Liberals chose to hack, gut and gouge health care to the tune of $3.6 billion. The effects of this slash and burn policy have been devastating.

In Quesnel and district there are only 44 hospital beds for a population of 25,000 and the sick and suffering are being cared for in the hallways. Unfortunately the Liberals do not seem to care.

While people were hurting they chose to give $221,500 to the Society for Canoe Championships. While people were hurting they chose to give $734,766 to the Majestic Fur Association. While people were hurting they chose to give thousands of dollars to build golf courses, ski hills and club houses.

Canadians believe health care and human life are more important than new golf courses and canoe championships. That is why Reform will reinvest $4 billion into health care and education. We will show compassion to the suffering and we will make the needs of the sick and hurting our top priority.