House of Commons Hansard #155 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was port.

Topics

The House resumed at 12 p.m.

The House resumed from April 10 consideration of the motion.

Budget Implementation Act, 1997
Government Orders

April 14th, 1997 / 11:15 a.m.

Liberal

Jesse Flis Parkdale—High Park, ON

Mr. Speaker, I am pleased to participate in the debate of Bill C-93, the budget implementation act, 1997.

With all the election fever in the air, this may be the last opportunity in my political career to share with you and others some experiences I have had since the introduction of the last budget.

It is peculiar that this last budget statement invoked very little response from my constituents in Parkdale-High Park who are as conscientious as they are diverse. As usual I received many representations from constituents before this year's budget presentation, but since the minister's statement I have had few comments that came to my attention.

I recently had the opportunity to interview the hon. Minister of Finance on a local television station and I explained to him the

situation. In response the minister explained that the reason why Canadians have not reacted adversely to the last budget is because it was the result of a process that incorporated the wants and needs of Canadians. The budget is proof that the government has listened to Canadians and responded accordingly.

For this reason we can be proud of the popular participation of conscientious Canadians as it has reaped rewards like the child benefit act, expanded financial assistance for students in post-secondary studies, an extended interest in the Canada infrastructure program, and the list goes on.

During my interview with the minister I asked him the questions I thought my constituents would ask him if they had the opportunity. Of particular interest in my constituency is the Canadian infrastructure program. One of the larger projects that has been undertaken as a result of the federal funding is the Western Beaches tunnel. This $57 million project will provide a conduit for the area's storm sewage so that it may be diverted to treatment plants, keeping Lake Ontario free of materials that prevent adults and children from enjoying the city beaches every time the temperature goes up above 25 degrees Celsius.

Thousands of constituents and visitors are making excellent use of the new Western Beaches boardwalk, built not with boards but with a recycled plastic substance, making the boardwalk almost indestructible. Furthermore, the infrastructure works program has provided improved lighting and new paved roadways for High Park, a major attraction for the city's walkers, picnickers and tourists.

Projects like these have had an impact on long term and short term employment as well as on relations between the federal, provincial and municipal governments in investing in our future. I emphasize the word "investment" as it is the predominant theme in the budget.

An additional issue that has held the attention of many of my constituents is that of small business promotion. Parkdale-High Park is home to many small family run businesses. These businesses have multiplied over the years and have created communities that are renowned for their shopping and services.

Throughout my riding one can find business improvement areas and associations, known as BIAs, that have engaged the interests of local business people to pool their resources in order to improve the local environment and attract consumers. Members of these BIAs, including the Parkdale Village BIA, Junction Gardens BIA, Bloor West Village, Roncesville Village and Bloor by the Park BIA, depend on programs like the Small Business Loans Act and the quarterly remittance of withholding amounts in order to stimulate their operations and assist them in reaching their markets. The presidents of the BIAs that I contacted for input on the recent budget statement were all pleased with the actions the government had taken and encouraged the minister to stay the course.

Speaking of staying the course, I assume that one of the fundamental reasons for Canadian support of the last budget is because they are pleased that the minister has committed to deficit reducing measures, and has not been swayed by the recent success of overachieving deficit targets. I am sure that everyone here is aware that the government surpassed its goals and reduced the Canadian deficit to the lowest among G-7 nations. This level is the lowest Canadians have experienced in 15 years and it is a testament to the excellent job the government is doing in controlling its spending and taxation activities.

Canadians are proud to be in such economic good health but they are also wary that there is still a long way to go. For this reason the government has shown its prudence in not reversing the current trend. However, due to a combination of success and prudence, the government made no new program spending cuts in its last budget announcement. Instead it created new outlets for assistance to Canadian students, children below the poverty line and Canadians who are searching for jobs. These programs will cost the government less than $1 billion to implement and the result will be a great profit for all Canadians in the form of a preserved social safety net and a growing commitment to investment in Canada's future.

The idea of investment takes on the guise of a theme throughout the budget. On this particular theme two initiatives spring to mind. The first is a child tax benefit for impoverished children and Canadian families, and the second is the government's commitment to post-secondary students, a demographic that is essential to the continued growth and prosperity of our nation.

The issue of the child tax benefit is of great interest to me because I spent many years with the Toronto Board of Education where I was challenged to stimulate the attention of young children who came to school with hunger pains and the troubles associated with living below the poverty line.

With the child tax benefit the government is increasing its current level of spending of $5.1 billion to $6 billion with the intention of increasing services and programs for poor working families such as child care, drug and dental benefits. This is a clear investment in the children who will one day grow up to be contributing members of society.

Finally, I would like to spend a moment on the issue of post-secondary education and initiatives by the government to ease this pressing concern of students and parents across the country. Students are currently facing tuition increases in most post-secondary institutions. The fear of increased debt loads by students who need to borrow money to complete their studies is a great deterrent to potential.

As a government we must do what we can to ensure that Canadian educational institutions will continue to produce highly educated adults who will be the next professionals and teachers for future generations. Through tax assistance and changes to the registered education savings plan, the RESP, student and parents will be better able to save and provide funds for those important years of study.

The government has announced its intention to extend the interest free period for students facing hardships in repaying their loans from 18 to 30 months. Furthermore, the Minister of Human Resources Development will be looking into the possibility of negotiating with the provinces to alleviate part of the burden of a payment schedule for students.

The initiatives I have discussed are the ones I have gauged to be of the most interest to my constituents in my riding of Parkdale-High Park. These initiatives are clear responses to representations from my constituents and other Canadians who have shared their views with the government throughout its mandate. Canadians are content that their voices have been heard and they feel as if they have had a valuable hand in formulating the budgetary process.

I would like to conclude by applying this public confidence and participation to a more global context. I recently had the honour to represent Canada at the Liberal International meeting, hosted by China. This nation has indicated that it is open to the ideas of liberalism which guide many North American and European national policies.

During the nine day meeting, I spent a great deal of time discussing the virtues of public participation in Canada's democratic society. The Chinese were interested to learn how our budget process works, along with the decision making process for deficit targets and monetary policies. I believe that the Canadian system stands as a perfect example of how the public can become involved in the political process by speaking up and being heard. What Canadians have been saying and what the government has been hearing is: Stay the course.

My course will be to exit this Chamber after the 35th Parliament is dissolved. Before doing so, I wish to thank you, Mr. Speaker, for ensuring objectivity and fairness to the democratic process. You protected the rights of every elected member in the House, regardless of party affiliation or sitting as independent members. You also brought into the House outstanding Canadians, such as former parliamentarians, well known artists, outstanding athletes and photographers. You made all of us feel at home in our House of Commons.

I would like to express my appreciation to the table officers, the pages, the interpreters and the Library of Parliament for making my work easier and more effective.

During each of the four terms that I was elected, I was sent here to serve my constituents, to make Canada a better country in which to live and to represent Canada abroad. I was able to do so effectively, thanks to the support resources on the Hill, within the House of Commons and outside the Chamber, especially in committees.

To all individuals, departments, researchers, media, staff and all the others who I would like to mention but do not have the time, my sincere appreciation for all of their support.

Budget Implementation Act, 1997
Government Orders

12:10 p.m.

Bloc

Jean-Guy Chrétien Frontenac, QC

Mr. Speaker, this morning we now have 71 minutes left to talk about the latest budget, about Bill C-93, the Budget Implementation Act, 1997, and the motion to refer the bill to committee before second reading.

As the member for the beautiful riding of Frontenac in Quebec and as a member of the Bloc Quebecois, the official opposition, I can hardly be expected to be enthusiastic about the latest budget which as far as I am concerned is a lot of smoke and mirrors. This is an electoral budget.

First of all, when the Liberal Party came to power on October 25, 1993, about three and a half years ago, the Conservative deficit was around $42 billion. For the current year, the deficit should be around $17 billion. Sure, the deficit went down by $25 billion, because the minister was able to take advantage of favourable economic trends and because of the drastic and often brutal cuts he made in his budget.

First of all, let us remind the Minister of Finance that today the employment insurance fund has a $6 billion surplus.

So what did they do to get this $6 billion dollars? They kept employer and employee premiums very high. They reduced the time during which workers who lose their jobs can receive benefits. They also increased the number of hours worked-we now talk about hours-people need to qualify.

Furthermore, 1 per cent of 55 per cent is deducted for every 20 weeks a worker draws employment insurance. If a worker receives employment insurance every year, after 20 weeks of benefits he will reach the minimum, which is 50 per cent of his eligible earnings.

So there is a $6 billion surplus the government uses year after year to reduce its deficit. It also cut $4.5 billion in transfers to the

provinces. In other words, the government has offloaded a substantial part of its deficit onto the provinces, including Quebec. The Quebec government also has to make cuts in transfers to municipalities and school boards. This is a chain reaction. You kick your neighbour, who kicks the next person, and so forth.

What I really want to condemn this morning, during the 10 minutes I am allowed, are the promises made but not kept in the notorious red book that was distributed across Canada. Today, we are looking for copies to give our constituents before the next election, but they have become very rare. I am willing to pay a lot for the red books that were being circulated in 1993, just like Mao's little red book. I suppose the Liberal Party, in its shame, has collected all the red books and burnt them.

Mr. Speaker, you know the Prime Minister often has a colourful choice of words. He said they were going to scrap, and I imagine he meant tear up, the GST legislation. And now, less than three and a half years later, instead of scrapping the GST, he is doing everything he can to hide it. In fact, he gave $960 million, nearly $1 billion, to three small maritime provinces for harmonizing his GST with their provincial sales tax, the so-called harmonized sales tax, the HST. So that is what the Prime Minister and the Minister of Finance did to make us accept the fact that the GST would no longer exist, at least in part of the country.

I may remind the Minister of Finance that he is not being fair to all citizens of this country. Two weeks ago, in a pre-election tour of my new riding, I met the mayor of Saint-Ludger, in the Beauce region, who asked me: "Why is the government not treating Quebec fairly? How does it explain giving $1 billion to harmonize the GST in the Maritimes, when we in Quebec did it in 1991 with Robert Bourassa, the Liberal premier in Quebec at the time, and Brian Mulroney, the Conservative Prime Minister?" Mr. Mulroney had the courage to create the GST, and it is the cause of his downfall to a large extent and of the Conservative Party's being swept out of office in all but two ridings in Canada.

So, Brian Mulroney and Robert Bourassa agreed in Quebec to harmonize their sales taxes, the GST and the QST. The Government of Quebec collects them, while, in the case of the maritimes, Ottawa will be collecting them. Year in and year out, it costs the government in Ottawa some $60 million, because we split the cost of recovering the government's GST fifty-fifty.

What does this government give the Quebec government in exchange for having harmonized in good faith in 1991? Zilch. It gives it nothing. This government is not treating Quebec taxpayers fairly. And Frank McKenna is using the money he gets from the federal government to pay for advertising to lure our industry away.

Another fine promise I would like to look at in the now extinct famous red book is the slogan of "jobs, jobs, jobs". I was listening to the Prime Minister saying in a speech last week: "We have created 675,000 jobs in the past three years". In my region, while I was taking part in the opening of a new store known as Intermarché, the owner told me they were going to create 55 new jobs. At the end, off in a corner, I said: "You are going to create 55 new jobs, that is great. However, will there be layoffs in the other stores you will be getting your customers from?" He said: "Well, sir, one thing leads to another. Nothing is wasted in nature. I will create 55 jobs here, so 55 jobs will be cut somewhere else". The fact that there is a new Intermarché in Plessisville is not going to cause people to go grocery shopping three times a week.

It is the same story in the restaurant business. A new restaurant is opening on rue Notre-Dame, creating 43 new jobs. But I would expect there will be 43 layoffs in other restaurants.

I could remind the Prime Minister, who is going on about how he has created "jobs, jobs, jobs", that we have never, since the terrible economic crisis of the 1930s, seen an unemployment rate as high as this go on for so long.

Three weeks ago, one of my constituents turned up unannounced at my office with his tax returns. He asked my secretary if he could meet with me. Naturally, I saw him, but I wondered why he had brought along his tax returns. This was a man of 66, retired from the asbestos mines. Before sending off his tax returns, he had to add a cheque in the neighbourhood of $3,000 to each envelope, the one for the Government of Quebec and the one for Ottawa. I said to him: "Why don't you help us bring about sovereignty for Quebec?" Instead of having two agriculture ministers, a Prime Minister and a provincial premier, two industry ministers and so on, two of everything, you would just send your cheque to one place. Of course, the one cheque would be much higher but, proportionally speaking, you would pay a bit less and you would get better service". Right now, we have a premier, who is working to help Quebecers, and a Prime Minister, who is doing anything but.

Mr. Speaker, I request another 30 seconds in which to wrap up, 30 seconds to talk about the results of the Gallup poll that came out this morning. It says that a majority of Canadians, 45 per cent, say we are worse off today, after four years of Liberal government, worse off today after what this Prime Minister's Liberal government is going to try to make us believe during the next election campaign. The Gallup poll results appeared on page 7 of this morning's La Presse .

I take this opportunity to urge you to be wary and not to swallow everything you hear from politicians.

Budget Implementation Act, 1997
Government Orders

12:20 p.m.

Reform

Keith Martin Esquimalt—Juan de Fuca, BC

Mr. Speaker, it is a pleasure today to speak on the budget debate. In the 10 minutes that I have I would like try to dispel some big myths. The government has been making misrepresentations to the Canadian public over the last three years in what it claims to be doing with its budget and its fiscal, macro and micro economic policies. The reality is that the financial situation is very different from what the government portrays it to be. Members of the government have repeatedly said a number of things that do not represent the real economic situation of the country.

I would like to go through a few of them. The first myth the government likes to put forward is that it does not increase taxes. In my hand I have a list of over 30 tax increases that the government instituted since it came into power.

I will mention a few of them. The lifetime capital gains exemption was eliminated. The tax on private corporations dividends was increased. The air transportation tax all Canadians pay as they go through an airport was increased. The corporate surtax was increased. The excise tax on gasoline was increased, something that affects everyone, in particular people on fixed incomes.

There was a reduction of $8,000 in RRSP overcontribution. This is at a time when the government is telling people that the CPP is in a bit of trouble, that it will have to take some extreme measures to save it and that in future they had better look forward to trying to provide for themselves. What did the government do? It prevented people from actually taking care of themselves by saving money for future retirement.

It increased EI premiums from 3 per cent to 3.07 per cent. There have been a total of four increases in the CPP premium. That is a tax. It has gone from under 5 per cent to 9.9 per cent. That is what the government has done.

It is completely disingenuous to say there have been no new tax increases. There have been lots of them. That is not the way to get our fiscal house in order. The way to do it is to cut sensibly and compassionately, get rid of the waste, priorize spending, and priorize the money the people of Canada give to the government and spend it wisely on those things government does best.

Some would argue that increased tax on corporations is a good thing. When corporations are taxed it is the public that is being taxed. All those taxes fall on to the consumer to pay. It is not a tax on somebody who has deep pockets. It is not a tax on somebody who has a lot of money. It is not a tax on people with seven-digit incomes. It is a tax that has to be passed on to the consumer.

Further, taxing corporations will make them unable to compete within and outside Canada. That puts Canadians out of work. Hence the fact that our unemployment rate has been hovering around 10 per cent, the worst since the depression.

The government says it is a defender of medicare. It says it has put about $500 million into it. Bravo, but how could it possibly put $500 million into medicare when it has just removed $7 billion from education, health and welfare? It does not add up.

The government likes to say it is interested in jobs, jobs, jobs. As I mentioned before, the job situation is completely appalling.

There are things that can be done. This is not rocket science. There are real life examples of measures the government could institute to enable us to get our house in order. Where are they?

Two places come to mind. First is Alberta. Alberta is the top fiscal performer in Canada and in North America. It is the best. Why? It has cut sensibly, is now running a budget surplus and can bring down its debt, the real ogre in the situation. By bringing down the debt, the structural changes necessary can be put forward to get social programs in order and bring in tax relief. In essence, it provides economic impetus that puts people back to work and enables Canadian companies to be more competitive.

New Zealand is the other real time example. Instead of increasing taxes it drops taxes. Other countries such as Lebanon are doing the same. As a result, there has been a huge influx of capital and investment into these countries which has enabled them to create jobs and to become more economically aggressive.

There is no reason we cannot do this today. I suggest the government take a few suggestions from countries that have done something good for their people. There is more we can do. The government should have listened to the plan we gave it three years ago. My colleagues put forward a budget that would have given the government the ability to balance the budget by 1997. If it had taken the plan we put forward, the budget would be balanced. We would be running a surplus. We could have reduced debt and provided tax relief to all Canadians. Did the government do this? No, it did not.

Our party also put forward sensible solutions to decrease interprovincial trade barriers to prevent blocks to commerce within the country that prevent companies from being competitive across the border.

We also need to improve our education system. Making it more attuned to the needs of the 21st century is absolutely essential if we are to be competitive in the future. Similarly enabling students to have enough money to pay for their education is important. Students cannot do this if they cannot get jobs and once they are educated there are no jobs for them.

A massive brain drain is currently taking place. Our best and brightest students are going to other countries because they cannot get jobs in Canada. Furthermore, many who stay in here are finding it impossible to work in what they are good at. They wind up taking jobs for which they are overqualified. It is a huge waste of the best and brightest.

We need to do many other things. Above all we need to institute confidence in the Canadian public, Canadian corporations and foreign investors. It is impossible to do so if we continue to mismanage the finances and the fiscal responsibilities of the government.

Plans have been given to the government yet it has chosen for political expediency not to listen. If the government were to take the bull by the horns and put forth solutions, the public would fall in behind it. The public would say it has a government that is making decisions, that is taking action, that is not trying to be ruled by opinion polls and focus groups, and that is prepared to put forth sensible, effective solutions to the problems.

The government must consider several points. It has to get its fiscal house in order, bring our deficit to zero and decrease the debt and taxes. It has to provide strong educational support to the students and get rid of egregious restrictions, rules and regulations that prevent our companies from being the best they can be. It should take a leaf out of the books of other countries, look at what has been done there, look at what has been successful, employ it here, and above all else act.

Budget Implementation Act, 1997
Government Orders

12:30 p.m.

Liberal

Bill Graham Rosedale, ON

Mr. Speaker, I am pleased to be recognized to speak on the important budget we were privileged to assist in presenting to the House recently. I could not disagree more with the words of the member for Esquimalt-Juan de Fuca. The budget responds to the needs of the country. It responds to the needs of the people of my province of Ontario. It strongly responds to the needs of the people who live in Rosedale.

Rosedale is a complicated riding. It is an inner city riding with a great diversity of talent and background in its population. Its workforce is spread between those who work in some of the major financial institutions, mining companies and other big companies located in Toronto and those who have modest earnings in the southern part of the riding, some of whom are subject to the pressures of living in an expensive urban environment where they are dependent on social housing and welfare to survive.

It is important that budget has achieved the need to get our fiscal house in order. It has stayed the course in that extraordinarily important enterprise. As a result we are seeing the fiscal integrity of the country being restored. As a result of interest rates being low we are seeing more investment and a return of jobs for Canadians. In that sense the budget is making its most important contribution to the underlying economy of the country and the well-being of all Canadians wherever they may be located.

It is a budget, however, that does not follow the tenets of the party the member from Esquimalt spoke for. It does not seek to achieve fiscal rectitude on the backs of the poor and the disadvantaged. On the contrary, the budget has enabled us to address some very serious problems in society. I do not intend to go into all of them, but in my riding there is no doubt the budget's concentration on the need for reform of the old age security system country and the Canada pension plan has enabled seniors, the most disadvantaged, to say we are looking at a system that will address their needs. We are guaranteeing the preservation of a healthy, sane and intelligent policy for sustaining the seniors population into the future. That has to be one of the great contributions of the budget.

In the budget we have addressed another great problem facing many of us, the extraordinary issue of youth poverty. We cannot afford and should not further tolerate the problem of young people and children living in poverty. Nothing can be accomplished overnight. The seeds have been sown in the budget. The child tax benefit and other measures taken in the budget will help address this extraordinarily important social problem.

The budget contains a hopeful message for youth. It contains specific programs for youth employment, some innovative, useful and important programs to enable young people to get their first jobs.

The budget addresses the future, perhaps one of its most exciting aspects. The Minister of Finance made it clear to the Canadian people, to the government and to those of us in the House that we must have an intelligent policy for our future. If we are to have a future at all in a complicated, integrated global society in which we must remain competitive we must be able to deal with knowledge. We must deal with our survival in the most sophisticated manner. We must have a proper balanced approach to investment in research and development.

In that sense the construction of the Canada Foundation for Innovation is one of the most innovative and important steps any government has taken in a long time in this respect.

I would like to take the time of the House to read the comments of one of my constituents, the president of the University of Toronto, on the budget. He drew the attention of the public to the importance of the budget from a university perspective. In a recent publication he wrote:

February was a banner month for the University of Toronto and all other Canadian universities. The federal budget, containing the best news for Canadian research in many years, represents a new beginning for Canada and moves universities to a central place on the nation's agenda. It deserves the enthusiastic support not only of

universities but of all U of T alumni and all Canadians who believe in a more prosperous future built on ideas and innovation.

The budget commits the government to critically important investments in Canada's future. It allows us to begin restoring the international competitiveness of our universities and teaching hospitals; it helps students and their families meet the rising costs of higher education; and it encourages the private sector to give more generously in support of public purposes.

The $800-million Canada Foundation for Innovation announced in the budget is a historic reaffirmation of the federal government's responsibility for research and innovation. We are extremely proud of the fact that the foundation will be headed by Dr. John Evans, an alumnus and one of U of T's most distinguished presidents-The foundation will help build critically important research facilities across Canada, facilities that will attract and retain Canada's outstanding scientists and enable them to unleash their full creative potential. In full partnership with the provinces and the private sector, this program will create new opportunities and jobs for the next generation of Canadians.

The decision announced in the budget to make the federal Centres of Excellence program a permanent part of our national science and technology policy ensures a secure foundation for partnership between universities and the private sector. The overwhelming success of the centres over the past 10 years fully justifies this vote of confidence.

The president went on to say that the tax incentives to be provided for students are a very important contribution to enable affordable university education for students and that the improved tax treatment of charitable donations would help unlock private wealth for public purposes. The budget has thus contributed as well to the welfare of our universities and other public institutions.

I believe that we must say a few words about this centre, or foundation, for innovation, because a number of Quebec MPs have criticized the budget and also the creation of this foundation.

It must be acknowledged that the purpose of the foundation is to enhance Canada's R & D capacity on the national level. In deciding which projects will be funded, therefore, the foundation will be more concerned with research excellence than with allocation by province.

A significant research potential is available from one end of Canada to the other. For example, Atlantic Canada distinguishes itself in the area of ocean and fisheries research; Saskatchewan, in biotechnology; Quebec and Ontario, in pharmacology; and Alberta and British Columbia, in sustainable forestry, to give but a few examples.

The foundation has the capacity to examine in depth all of the proposals for funding research and other crucial sectors, giving priority to quality projects. What is more, the bill calls for the foundation board to reflect regional diversity and to have equal representation from research and from business.

Everything points to the regional representativity of the council and the expertise of its researcher and business leader membership guaranteeing a fair and equitable distribution of funding while reflecting regional realities.

I would like to add that the president of the University of Toronto's reaction to the announcement of the foundation's creation in last February's budget was that it would make a huge contribution to the national infrastructure required to promote a knowledge-based economy.

I was, therefore, interested and somewhat astonished to hear the hon. member for Verchères criticize the budget and express regrets that the Varennes tokamak project in Quebec was no longer being funded. Yet it is that budget which has funded a major institution in order to enable it to carry out such research, and if this project merits funding, it will have the opportunity to get the money it needs. And that is exactly what has to be done.

In closing, I will return to what I said at the start: this is a well-balanced budget, and one which has acknowledged the need to bring the deficit under control, while making it possible for the less advantaged in this country to survive.

On behalf of my constituents of Rosedale in Toronto Centre, I wish to state that this budget will be accepted as one of the best the Parliament of Canada has ever seen.

Budget Implementation Act, 1997
Government Orders

12:45 p.m.

Bloc

Osvaldo Nunez Bourassa, QC

Mr. Speaker, I rise in the House today to speak to Bill C-93, an act to implement certain provisions of the budget tabled in Parliament on February 18 by the Minister of Finance.

This bill, which was tabled last week, proposes measures to implement the government's latest budget. It was tabled just last week, and the government wants to use the fast track to refer the bill without delay to the finance committee for consideration.

As we all know, the main objective of the latest federal budget is to fight the deficit, but at the expense of the provinces, with cuts of $4.5 billion in transfers to the provinces, and at the expense of the most vulnerable in our society, with cuts affecting health care, education and social assistance.

This was a very harsh budget. Today, we read in the results of a Gallup poll that Canadians feel they are worse off than they were four years ago. It is the truth. Most Canadians feel they are worse off than they were four years ago when the Liberals were elected.

The article in La Presse says:

The majority (45 per cent) of respondents believe that they are worse off now than in 1993, in other words, since the Liberals came to power in Ottawa. A little less than one

third (32 per cent) feel they are now better off, while one fifth (20 per cent) have seen no noticeable difference in their lives during these past four years.

In practically all age groups, negative responses predominate. This is particularly obvious in the 50 to 64 age group, where only 16 per cent of respondents said they felt they were better off and54 per cent said they were worse off. There you have the Liberal government's disastrous record for the past four years.

However, the 1997-98 budget contains no job creation measures. Worse yet, the federal government has been the main source of collective layoffs during the past years: 45,000 public servants lost their jobs. And because of cuts made by the provinces, because of the reduction in transfers of federal funding, hundreds of thousands of people have lost their jobs in provincial and municipal governments and in our school boards. In Canada generally, 200,000 people lost their jobs at provincial and federal levels.

As I said earlier, I represent Bourassa, a riding in Montreal which is now the unemployment capital. The federal government has done nothing. It appointed a minister to look after Toronto but did nothing of the sort for Montreal.

As regards the deterioration of Canadians' situation, I have here figures on poverty for the year 1995, a report from the National Council of Welfare. In its report, the council says that the statistics on poverty for 1995 were alarming. Growing family poverty raised the overall poverty rate to 17.4 per cent and the number of Canadians living in poverty to close to 5.1 million, a new record for the past 16 years. The number of such people was higher in 1995 than in the darkest period in the two recent recessions.

As far as children are concerned, the rising level of family poverty has caused a corresponding increase in poverty among children. In 1995, the level of poverty among children reached20.5 per cent, and the number of poor children was over 1.4 million. This is the highest figure ever reached in the past 13 years. Those are the statistics for 1995. We are in 1997, and the situation has got even worse.

The immigrants form another sector of the population becoming increasingly poor in Canada. What does the report say? The levels of poverty among single people born in Canada and families where the heads of households were born here are invariably lower than those of corresponding groups of immigrants. In 1995, for single people born in Canada, the rate was 34.9 per cent and for those who had immigrated to Canada, it was 42.8 per cent. The poverty rate for heads of households born in Canada was 12.9 per cent, while it was 20.3 per cent for those who were born elsewhere.

In addition, the government has imposed a tax of $975 on immigrants, including refugees. These days, Canada is the only country in the world to impose a tax on refugees, which contravenes the Geneva convention.

We have said that the level of poverty is increasing among old people, especially among people who have lost their jobs. At the age of 45 or 50 they are no longer able to find work. The government has made the situation worse by eliminating the program for older workers adjustment.

The situation is very serious in my riding in Montréal-Nord, but there are also signs of hope. I took part in the inauguration of the Montréal-Nord CDEC, the Corporation de développement économique et communautaire. Discussions have been going on for five years, and this was my priority when I was elected a member of Parliament. The CDEC finally began operations in February.

The Government of Quebec made a contribution to the CDEC, as did Montreal North, but there has not yet been anything from the Government of Canada, which was to put in $170,000. I take this opportunity to pay tribute to the exceptional work done to date by the CDEC's president, Claude Tessier, and by the chairman of its board of directors, Yves Deslauriers.

I also pay tribute to another organization that does a lot for the people of Montréal-Nord, the Montréal-Nord chamber of commerce founded in 1947, which is celebrating its 50th anniversary this year. It has made a major contribution to the economic development of our city. I would also like to pay tribute to its president, Richard Bertrand, and its executive director, Olive Lebeau.

This 1997 budget falls down in many areas. We are going to point these areas out in the election campaign to be launched in two weeks' time.

We are going to talk about the Liberal government's broken promises. We are going to attack the government for its total failure in the fight against unemployment. We are going to condemn this government that has cut tax credits for workers' funds, particularly the Quebec workers' solidarity fund, an important tool for the creation of lasting jobs. We are going to talk about the Liberal government's terrible record over the last four years.

Budget Implementation Act, 1997
Government Orders

12:55 p.m.

Reform

John Duncan North Island—Powell River, BC

Mr. Speaker, I am pleased to participate in the debate on Bill C-93, an act to implement certain provisions of the budget which was tabled in February. I wish to direct my comments to those parts of Bill C-93 that allow certain Indians in British Columbia to impose an excise tax and value added tax on sales of tobacco products on reserves.

I have had the opportunity to speak to the last three budgets and each time the conclusion is inescapable. The Minister of Finance still does not have it right.

Government generated debt and the resulting tax burden is placing many Canadians in a position of financial hopelessness, unable to get ahead and forced to survive with a current personal debt load equivalent to 95 per cent of their annual personal disposable income. This has grown since 1982 from 62 per cent. This administration has picked Canadians' pockets for a further $24 billion in taxes.

Before I turn to parts II, III and IV of Bill C-93 on the tobacco taxation issue, I would like to make a few comments regarding the manner in which the Indian affairs department is run and offer a few suggestions on what the government could do to improve the legacy of poverty that grips so many members of First Nations.

In 1976-77, not so very long ago, total government departmental spending for the Department of Indian Affairs and Northern Development was $587 million. Today that number is $4.3 billion. This is an increase of 2.4 per cent over last year's budget. All of this for 573,000 status Indians registered under the Indian Act, about 2 per cent of Canada's population.

This sink hole of spending is sad because we have continued misery and a sense of hopelessness where so many of our native people live and continue to live. Despite the spending restraint placed on all other government departments, the spending of the Department of Indian Affairs and Northern Development to 1998-99 will grow an accumulative 12.7 per cent during the term of this government compared with a decline of 24.4 per cent in other departments. This is the only federal department in which spending in 1998-99 will be higher than in 1994-95. It has a history of misguided priorities where the current minister feels that maintaining this native dependency on the federal treasury will deliver these people to self-sufficiency. This is a cruel hoax.

Furthermore, the Canadian taxpayer is suffering because despite all the federal largesse and misguided paternalism, the status Indians who live on reserves do not pay income, property or sales taxes on purchases sold on or delivered to their reserves. The department is totally compromised on this taxation issue.

Section 87 of the Indian Act is surely an outdated, out of step section of the act which protects and maintains this counterproductive exemption.

Total government spending for Indians for all departments runs $7 billion. This excludes the taxation exemption or forgone revenue which results from section 87 of the Indian Act. Reform's position on section 87 is clear. We saw some signs in the Nisga'a negotiations and Sechelt negotiations in British Columbia where the federal government is not dealing straight on the taxation issue.

We have also seen how this tax exemption creates a circumstance where there is no mandate for any other federal department on reserves. For example, the Department of National Revenue has no mandate. This has entrenched a longstanding, self-serving mandate by the Department of Indian Affairs and Northern Development, which has been very counterproductive.

This artificial financial arrangement has also led to many economic dislocations. Lower wages have been justified by the government, lower welfare rates, all kinds of things have been lowered on reserves because of the absence of taxation on these kinds of schemes. In my view this is very counterproductive and in the view of many others.

In hindsight the anecdotal evidence is that native run businesses with a focus on taxation exemption have not been nearly as successful as native run businesses which have operated with the same entrepreneurial focus as off reserve businesses.

To really demonstrate that none of this shows that the taxation exemption is really working, one could ask why are 43 per cent of on reserve natives in Canada on welfare. There are certainly some people getting bloated on the morass of spending. One place is the Hull bunker for the department of Indian affairs which houses 34,000 bureaucrats. Accompanying these public servants are consultants, negotiators, lawyers and advisers, all taking a piece of the $7 billion in action and keeping the myth and their club memberships alive.

Budget Implementation Act, 1997
Government Orders

1 p.m.

An hon. member

An Indian industry.

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Government Orders

1 p.m.

Reform

John Duncan North Island—Powell River, BC

It is an Indian industry that has made some very rich.

We have before us today another half step, somewhat like the initiative of Bill C-79 that allows modifications in the application of the Indian Act for certain First Nations. It is a tinkering and at this rate with 600 First Nations we may address section 87 tax exemptions by the third millennium if we are lucky.

This legislation in Bill C-93 is very much a British Columbia specific initiative. Part II of the bill before us will enable the Cowichan Indian tribes to impose a tax on sales of tobacco to Indians on reserves of the Cowichan tribes. The Cowichan tribe is essentially mandated by the legislation to collect a tax from its own membership similar to the way the province currently collects tobacco taxes off reserve. The tobacco taxation provisions for on reserve sales to Indians vary by province and are very complex in British Columbia.

In some provinces there is no on reserve provincial tobacco tax exemption at all. It is a hodge-podge, getting hodgier and podgier.

To further supplement the application of the first tax in section 2, section 3 of Bill C-93 will enable the Cowichan tribes to impose a second tax or 7 per cent value added tax on sales of tobacco on reserve. One might compare this to the GST which is exempt for tobacco sales on reserve to band members.

Part IV of Bill C-93 enables another First Nation, the West Bank First Nation, to impose a 7 per cent value added tax on all sales of tobacco products on its reserves. The West Bank band provisions do not include the provincial equivalent taxation provisions that apply on this bill to the Cowichan tribe.

I have raised the issue of native taxation many times both in and out of the House and I have received the rebuke and bluster of the minister. His approach, like his predecessors, is to maintain more or less the status quo.

The government now spends more on natives than it did three years ago. The Indian Act has not been amended, let alone repealed. Accountability for funding is no closer to acceptable procedures, and complaints from many quarters about undemocratic band elections remain unaddressed. Here we have complexities in our taxation scheme in Canada being assailed from all sides. A simplification need is apparent.

Whose agenda is fulfilled by this initiative? Legislative tinkering has become a substitute for substance and vision from this government.

Budget Implementation Act, 1997
Government Orders

1:05 p.m.

Liberal

Murray Calder Wellington—Grey—Dufferin—Simcoe, ON

Mr. Speaker, the overall thrust of this budget has been restoring Canada's fiscal health. The deficit for 1996-97 will be no more than $19 billion; $5.3 billion less than the target of $24.3 billion set in the 1996 budget.

The target for 1997-98 is $17 billion and for 1998-99 it is $9 billion. By 1998-99 the deficit is expected to be 1 per cent of GDP with no new borrowings. On top of that these projections are based on prudent assumptions and include a contingency reserve to cover any unpredictable events.

There is more to this budget than just the figures I have talked about, particularly for the agricultural community. I know the chairman of the standing committee on agriculture is going to be very interested in what I have to say about this. This is the national advantage. It is by far a better way of looking at agriculture than what the Reform Party, heckling me from the other side, has come up with so far.

All stakeholders in our agriculture and agri-food sector stand to gain substantially in net benefits from being included within the larger Canadian federation. Together as a strong and modern unified nation we as an industry are indeed much greater than the mere sum of our individual parts. That is what the Reform regional approach is about.

By being Canadian we have access to a valuable domestic agricultural marketplace serving 30 million people, valued at more than $70 billion per year. While some interprovincial barriers still continue as impediments, over 90 per cent of our agricultural food products flow freely from coast to coast aided by federally developed standards. This is underpinned by the mobility of human technology and by financial resources and a single monetary system.

By being Canadian we all benefit from national regulatory policies which, for example, created and sustained our made in Canada supply management system for dairy, poultry and egg producers. No one province alone would be able to do so. The financial fiscal policies of this government have resulted in a dramatic drop in interest rates. That has saved thousands of dollars in input costs for farmers and the agri-food business in every corner of the country. It is by far a much better system than the tax cuts that are put forward by the Reform Party. National taxation policies which include unique advantages for agriculture are available to all Canadian farmers.

By being Canadian we all gain from Canada's international credibility and influence earned through 129 years of nationhood. Our reputation for the highest quality and reliability is an invaluable asset, something the Reform Party would try to destroy, the respectful manner in which we deal with our customers.

Our unified Team Canada approach to trade missions in dealing with trade disputes has had a strong role for Canada to play in the WTO, the Cairns Group, the Quad Group, the APEC the Commonwealth, the UN and the G-7. In short, worldwide goodwill about Canada gives us the advantage that could not easily be duplicated. By being Canadian we all enjoy substantial economies of scale. This is important for our bargaining clout in dealing with both consumers and competitors.

It is important in running a world class inspection and quarantine system, the cost of which would be prohibitive on a provincial basis. It is important in the field of science and technology where we have the leading edge in research and development facilities distributed nationally according to local natural advantages with all the accumulated knowledge networked to everyone regardless of location.

The 1997 budget funding for the Canadian Foundation for Innovation can be used in support of research into biotechnology and other agricultural sciences. Our national advantage is impossible to quantify but it is hugely important. It is a combination of

synergy, strength, equity and compassion which is the envy of the world, and our government is committed to building it even better.

Budget levels for the key responsibilities of Agriculture and Agri-Food Canada, research adaptation, safety nets and inspection, were maintained, ensuring the department would be able to continue to meet the needs of the sector. In maintaining spending for these key areas, the 1997 budget responds to the needs of the sector for stability.

The government is working toward a growing, competitive, market oriented agriculture and agri-food industry, one that is profitable, responsive to changing needs of domestic and international customers and less dependent on subsidization; one that contributes to the well-being of all Canadians and the quality of life in rural Canada and one that generates farm financial security, environmental stability and a safe and high quality food supply.

Significant progress has been made toward these goals but more remains to be accomplished. Strong partnerships with all the stakeholders are key to the further success. To this end the Minister of Agriculture and Agri-Food has been consulted extensively with all the agri-food sectors in all the regions through a series of round table meetings across the country, a national conference on Canadian excellence in agriculture and agri-food held in Winnipeg in June 1996, and a prebudget meeting with all stakeholders this December. The output of this effort is a practical business plan which portrays the ambitions of our sector as we head into the 21st century and lays out an agenda for action for governments, farmers and farm organizations, agri-food business and other stakeholders as we together strive to achieve our future goals.

Examples of this consultative process between government and agriculture and agri-food sectors that reflect this desire to move together are numerous. It is hard to put a figure on it.

The Canadian adaptation rural and development fund, for instance, is providing $60 million annually to support diversification, value added processing, market development, innovation and job creation. The national biomass ethanol program will help support financing of ethanol plants across the country. This is the fuel of the 21st century. The pesticide management advisory council and economic management advisory committees are being established right now to better foster communication and co-ordination of pest management issues. The Farm Credit Corporation has introduced new programs which will provide long term stability. A national agricultural environment committee, made up of farm leaders, has been tasked with providing the federal government, the federal minister of agriculture, with advice on new policies, research and development and key agricultural environmental indicators. The Canadian Agri-Food Marketing Council will provide strategic sectoral advice on how to make the most of the available market development programs.

I could go on and on with this good news. We must continue to let more and more people know that agriculture and agri-food in Canada accounts for 8.7 per cent of our gross domestic product. Two million Canadians' jobs are dependent both directly and indirectly on the health of the agri-food sector which presently generates $17.5 billion in exports annually. We are going to go over the top of $20 billion by the end of the century.

The Canadian agri-food sector is on the leading edge of highly sophisticated science and technology. Canadian agriculture is a leader in environmental stability. It is one of our base industries.

Budget Implementation Act, 1997
Government Orders

1:15 p.m.

The Acting Speaker (Mr. Milliken)

Resuming debate, the hon. member for Peace River. I should warn him that at 1.21 p.m., under the special order adopted by the House last Thursday, I will be obliged to interrupt the debate and put the question.

Budget Implementation Act, 1997
Government Orders

1:15 p.m.

Reform

Charlie Penson Peace River, AB

Mr. Speaker, that was the longest one minute I have ever heard.

Budget Implementation Act, 1997
Government Orders

1:15 p.m.

Liberal

Murray Calder Wellington—Grey—Dufferin—Simcoe, ON

But it's good news.

Budget Implementation Act, 1997
Government Orders

1:15 p.m.

Reform

Charlie Penson Peace River, AB

I am glad to be part of the debate on Bill C-93. We have to put things in perspective when talking about a budget implementation bill. My perspective focuses on something that members on the Liberal side of the House have not talked about in this debate, the $111 billion they have added to the national debt in the past three and a half years.

An equal amount of debt has been generated by the Conservatives and the Liberals, over $300 billion each in their mandates. It only took the Liberal government three and a half years to accumulate the last $111 billion. Talk about overspending. We are still deficit financing with $19 billion in this current year.

I hear Liberal members in the House and Liberal candidates on the hustings say that now that we have a balanced budget they want to be part of the debate on how to address the national debt. The last time I heard, there was still a $19 billion deficit. That is what is being borrowed this year. That is what they have trouble getting their heads around. They seem to think that a $19 billion deficit is a balanced budget, and that will be the launching point for them to start spending again. That is what Canadians are worried about.

During the last three and a half years we have gone through a whole process of budget cuts. The Liberals are telling people that now we have a balanced budget with a $19 billion deficit, we are going to start to talk about what we are going to do from here on. That could only be Liberal mathematics.

Most Canadians want lower taxes. They want a balanced budget, there is no doubt about that. When we get to that point they want lower taxes which really can only be offered by smaller government. The Prime Minister is saying that lower taxes are not the Canadian way. Where has he been? Canadians want lower taxes. I agree with him that it has not been the Canadian way under Liberal government over the past 30 years, nor was it under the Tory government. Taxes have gone up almost every year to feed this monstrous government we have.

In order to accomplish lower taxes for Canadians, the size government has to be pared down. Most Canadians realize a lot of paring could be done without too much hardship.

We have seen the government spending that has added to our national debt in programs like the national infrastructure program. There is not a Canadian who does not believe that infrastructure needs to be funded, that it is deteriorating and needs to be replaced, but a different method could be used to accomplish this. Some kind of a revenue sharing program between the federal government and the municipalities has to be a better way of approaching it. Then we would not get into these patronage, politically driven motives where the ball bounces only at election time. My understanding is that the government has just announced it is going to increase the amount of infrastructure spending in Quebec by about $112 million. It is going to supplement it a bit before election time. It is important to fix a canal over there.

The infrastructure program that the federal government has proposed will cost $6 billion. The federal Liberal government has spent $2 billion in the last three and a half years. It is borrowed money. That money was financed on international money markets. The program has been a failure. Every job created has cost $60,000 and they are not long term jobs.

Surely the better answer has to be smaller government and lower taxes.