Debates of May 27th, 1998

Monte Solberg Medicine Hat, AB

Mr. Speaker, I begin by seeking unanimous consent to split my time with the member for Calgary Southeast.

Monte Solberg Medicine Hat, AB

Mr. Speaker, I appreciate that. Now that my colleagues across the way have agreed to that I am afraid I am going to have to be less than charitable about why we need to do that.

Bill C-36 is about a number of things. It is the budget implementation act. It is about things like the millennium fund and all kinds of measures the government discussed in the budget.

The first issue I want to talk about is that the government has moved closure on this bill. Therefore my colleagues and I are forced to split our time so that we can speak at least twice on the third reading of Bill C-36. Otherwise we simply would not have the chance to do that.

When these government members were in opposition they routinely chided the Conservative government of the day for the times it moved closure. But now the Liberal government has actually exceeded the former Mulroney government in the number of times it has moved closure. I think it is 41 times since it came to power just over four years ago.

The hon. House leader for the government said when he was in opposition “I am shocked. This is just terrible. This time we are talking about a major piece of legislation. Shame on those Tories across the way”.

A member from Kingston said “What we have here is an absolute scandal in terms of the government's unwillingness to listen to the representatives of the people in the House. Never before have we had a government so reluctant to engage in public discussion on the bills brought before the House”.

We throw that back at the government and say when in opposition this was completely unacceptable. As members pointed out, on major pieces of legislation there should never be closure. We should be allowed to debate these things.

We are now talking about the budget. We believe that citizens, through their representatives, should have the ability to call the government to account for some of the things it has decided. We are talking about decisions to spend hundreds of billions of dollars. To move closure so that we have a scant two hours to debate the budget implementation act at third reading is unbelievable and completely anti-democratic. The government should be ashamed.

In order to talk about the millennium fund, I am afraid I have to go back in history a few years. When the government was running to be the government in the 1993 election, the current Prime Minister, then the leader of the Liberal Party, said in the leaders debate that he would not cut transfers to the provinces for health care and higher education. He told the leader of the Reform Party that if it were up to him he would raise the transfers to the provinces.

History shows that not only did the government not raise transfers to the provinces, it cut them by $7.5 billion, a 40% cut for health care and higher education. The impact of that was devastating. We saw people in the provinces rebel. The were extraordinarily upset. We saw people picketing and marching on provincial legislatures.

I think the people were misguided. They should have been on the lawn of Parliament Hill because when the provinces are faced with cuts of $7.5 billion they have no choice but to make cuts themselves in health care and higher education.

Unfortunately the government blatantly broke a major election promise and now it has chosen to introduce the millennium scholarship fund in the vain attempt to convince people across the country that it somehow cares about higher education.

When Canadians start to look at the details of the millennium scholarship fund they will be extraordinarily disappointed. They will find it helps precisely 7% of all students today trying to upgrade their skills so they can get a job in the modern workforce. But the government has carried on as though this is going to help everybody.

It could have helped everybody if it allowed the provinces to keep these transfers and the provinces could have given them to everybody in the form of lower tuition costs, and that truly would have helped everybody.

Now we have the government saying it is going to help 7% of the students who return to school. Granted, a lot of those students are part time but nevertheless they need skills upgrading to get a better job.

The government's argument is that this will help 100,000 people through scholarships to individuals. That is only 25% of the full time students, leaving 75% to be completely excluded.

This huge memorial fund to the Prime Minister is really going to help very few of the people who should be helped and could have been helped had the government allowed the money to stay in the pockets of the provinces and be used to reduce overall tuition costs.

The Reform Party and colleagues in the Conservative Party, the Bloc and the NDP brought forward a number of serious proposals to hold the government accountable on how the millennium scholarship fund would be used. Unfortunately when we brought these forward at report stage the government moved closure, cut off debate and these very serious helpful proposals never had a chance to be discussed.

Unfortunately again the democratic will of parliament was thwarted. I believe the democratic rights of Canadians to have these things discussed by their representatives were thwarted. We are in situation now where the government will completely ignore all the suggestions that came forward from the various opposition parties via the witnesses who will be most affected by changes brought about by the millennium scholarship fund. They will never find their way into legislation.

The moves to hold the fund more accountable will not be discussed. They will not be looked at by the government. The suggestion that the auditor general be the auditor in charge of the fund may not ever be accepted by the government. The suggestion that the millennium fund be subject to access to information will be completely ignored by the government.

That is what happens when a government moves closure on an important piece of legislation like a budget. It is absolutely ridiculous and it is an affront to people who believe in the idea of democracy. We are extraordinarily disappointed in how the government has dealt with this whole issue. But it even goes beyond that. Not only did the provinces take the heat when the government cut transfers back in 1995, all the heat for what the federal government had done, now the government is going to end up letting down all Canadians once again. I would argue it is going to let down many of the very students it proposes to help.

What students are going to find out when they graduate from universities, after having taken advantage of the millennium scholarship fund, is that many of the jobs they have been trained for simply do not exist in Canada, which is why we have a massive problem with brain drain today.

My colleagues in the Reform Party have spoken on this issue many times in the past. I know my colleague from Calgary Southeast has talked on this before. Many of their own family members have had to go across the border to the United States most often, also around the world, to apply the skills they have received because of the generosity of taxpayers in this country. These students take this subsidized education and go across the border. One of the best examples is the university class at the University of Western Ontario where I think it was one-third of the entire graduating class in computer sciences was scooped up by Microsoft.

Canadian taxpayers via the millennium scholarship fund end up subsidizing the richest man in the world, Bill Gates, because he is the one who benefits by all these people who earn their education at taxpayer expense. How much sense does that make? What point is there in putting together a millennium scholarship fund if we are only going to graduate students to send them south of the border and never have the ability to take advantage of all those skills within Canada and all the benefits that would bring to the economy? What is the point of that? I do not think it makes any sense.

The government has failed utterly and completely to deal with the demand side of the equation. It is taking faulty steps in dealing with the supply side by providing these funds, but it has done absolutely nothing on the demand side. These highly skilled people, doctors, lawyers, computer scientists, nurses, engineers, technicians, our brightest and best, are being driven out of this country by an economic regime and a tax regime that is simply too difficult to live with. Why would they try?

I received an E-mail from a young man, 23 years old. He has a wife and child. He at the age of 19 went to the United States to apply his tremendous skills as a computer technician at various companies. He worked in silicone valley in California, got tired of that and wanted to come home. He ended up taking a job for less money than he was making in the U.S. He was making $75,000 U.S. in silicone valley. He came to Toronto to accept a position for $65,000 Canadian.

He sent me the E-mail when he received his first paycheque and had a look at the government tax bite. That is the problem this government has consistently failed to address. Now this young man with his tremendous skills is considering whether he really does have a future in Canada after all. He is considering taking his family and his tremendous skills and all the benefits that will reap for the economy and moving back to the United States. I think that is a terrible indictment of this government and this government's failure to deal with the huge economic problems that people in this country have to face every day.

That young man is extraordinarily lucky. He has these abilities and these skills and he has I gather a tremendous natural talent. He is able to parlay that into all kinds of job offers. But not everybody has that. So we have a different set of problems for people who do not have those skills and do not have those abilities, who have not had the chance perhaps to get an education. Those people are in a situation that is far worse than my friend the computer programmer.

They are in a situation where they are competing with hundreds of thousands of other people who do not have very many skills for jobs.

We have an unemployment rate of 8.4%. Today in question period I heard the finance minister boasting about the 8.4% unemployment rate. I would not boast if I were him because we simply need to look across the border to the United States to see that it has an unemployment rate about half what ours is, 4.3%. Here we are, economies that share a tremendous amount of trade, very similar economies, except its economy is far more efficient than ours. Its puts hundreds of thousands of people to work whereas hundreds of thousands of our people have to sit on unemployment insurance and welfare. That is a human tragedy of tremendous scope.

When a budget is brought down, one of the first things to be done should be to address issues like unemployment and high taxes that cause unemployment. I know what my friends opposite will say. They will say they did bring in tax relief. They will point to the cuts they made to the surtaxes.

What they fail to point out is that according to their own budget papers, the cut in income taxes through the reduction of surtaxes in this budget year will be more than erased by the phenomenon of bracket creep.

Right away taxpayers are still worse off this year. In other words, taxes are still going up this year compared to last year. That does not even take into account the whole issue of Canada pension plan premiums which are marching inexorably upwards 73% over the next six years, the largest tax hike in Canadian history. Where does that leave workers? It leaves them looking for jobs on the unemployment line. That simply is not acceptable.

I turn now to the issue raised today not only by members of the opposition but by the premier of Ontario and by Statistics Canada, the EI surplus.

I point out to my friends opposite that the employment insurance fund is there to ensure that in the event of a downturn there are adequate funds set aside so that the fund can provide benefits to unemployed workers. That fund is now at about $15 billion, way more than is necessary to take workers through even the toughest recession. In the next several months that fund will continue to grow.

The government does not actually have that money sitting in an account. It has essentially spent it, so there is an IOU. In other words, if there is a downturn in the economy they will have to borrow $15 billion. We should be very clear about that. This is another example of the government's so-called prudence.

The government is now using the overage, the extra premiums, coming in not for unemployment insurance, not for benefits, not to give back to the workers who are supplying it, including the small business people, the very people who create jobs. It is keeping it. What will it do with it? It is putting it away to use it for its election slush fund down the road. I think that is completely unacceptable. That is a breach of the deal that was made implicitly between governments and workers.

The deal was that money should be returned to them in the form of lower premiums so that they can keep it in their pockets, so they can use that money for the things they want to use it for, things like providing for their education, providing for their retirement. Unfortunately the government thinks it knows better.

We are in a situation today where the finance minister could not bring himself to say that we are going to start to reduce payroll premiums in a serious way so that workers are not so heavily burdened.

I also point out the impact that high payroll taxes have on business. The Canadian Federation of Independent Business points out regularly that payroll premiums are a job killer. It points to the government's finance department economists who say that payroll taxes like EI premiums are a job killer. Joe Italiano is one of the people I will point to. We qutote him in our document which we have made widely available to the public. My friends across the way laugh when I say that but it is a fact. When we have 8.4% unemployment we should have the government taking steps to deal with those sorts of issues.

This government has failed completely to deal with the issues that are the most important to Canadians. It has failed to deal with the issue of taxes and debt. It has done nothing about the debt issue. Instead it has tried to blind people and mislead them with all this talk about the millennium scholarship fund. I do not think Canadians are buying it. I encourage my friends around the House to vote against Bill C-36.

Jason Kenney Calgary Southeast, AB

Madam Speaker, I am delighted now that we have made a motion that at least one Liberal has decided to appear and to listen to the rest of the debate on the budget.

As I was saying before I was so rudely interrupted by the absence of members opposite, those debt interest costs will be $45 billion in tax dollars for this year, next year, the year after, and the year after that. That amounts to two full years of CPP benefits for every pension beneficiary in the country. Just the interest this year amounts to two and half years of GST revenues.

Seventy-one per cent of all personal income tax revenues paid this year will go just to finance the interest on the debt. All that we spend in benefits for old age security, the Canada health and social transfer for education and health care and employment insurance, the three big social programs administered by the federal government, are the amount equivalent to what we will spend on debt interest because of this budget and this bill.

The debt interest costs are equivalent to the entire annual budgets of British Columbia, Alberta, Saskatchewan and Manitoba. The debt interest this year alone is equivalent to the entire net debts of all provinces, except for the three largest provinces.

The $45 billion interest bill is enough to pay for all Canadian hospitals, all physician charges and all drug and pharmaceutical costs for an entire year.

That is how much this government has chosen to spend on debt interest because it has not made the right and difficult choice to reduce the debt and to prioritize spending.

What we spend on debt interest through this budget would be enough to cut taxes on an average of $3,200 a year per taxpayer, not per household. It is closer to $6,000 a year per household. It is enough to provide for a $30,000 a year endowment for every poor child in Canada.

The Liberals talk about their millennium prime ministerial endowment fund, heritage fund, or I do not know what spin name they have given it. If they had started earlier in the 1980s when they were in power to make the difficult choices and if they had continued on today, we would not be spending $45 billion a year in interest. Then families could keep $6,000 a year in their pockets, or we could set up an endowment of $30,000 for every poor child in the country.

If we were to convert the annual interest bill into $100 bills and we stacked them up one on one, the pile would be 118 kilometres high. The pile would be 214 times higher than the CN Tower.

That is the status quo which we are going to let sit there, that huge debt which is festering. This government and its spin machine talk at great length about prosperity in the Canadian economy and growth of jobs and so on but they have fallen prey to the very same fatal hubris of the Mulroney government. The Liberals believe arrogantly that they have managed to defeat something called the business cycle, the notion that in a market economy or any economy there are ups and downs.

Unfortunately there will be a downturn sometime in this economy. The finance minister speaks as though he is a Pollyanna. He speaks about a new golden age where this country will have 20 or 30 years of uninterrupted growth. I am an optimist and I wish the minister were right but any rational, objective reading of economic history in this or any modern country will indicate that it simply will not happen.

There will be a downturn in our economy at some point, a recession at some point. Government revenues will drop at some point and social expenditures will increase at some point. Should that happen while we are still sitting on a $583.2 billion debt with $45 billion in interest payments and the highest income tax burden in the G-7, it will be too late.

We have not solved the problem, the problem that Reformers came here to solve in 1993, the problem of overspending, the problem of overtaxation and the problem of too much debt.

We say here today as this government rams this bill through this parliament that it is time to stop and get our heads out of the sand. We have to realize the Mulroney government made precisely the same mistake in 1988 when it thought it was facing a decade of future growth. That government decided to let it go easy on the spending side. It decided to let up on the fiscal reins as this government is doing in this bill and this budget today. We are paying the price today with a $600 billion debt and $45 billion in interest payments.

It is time for us to remember the fundamental principle of the terrible lesson we have learned with the fiscal history of this country in the past two decades. We have not yet solved the problem. That problem is still very much the $583 billion debt which the government leaves completely untouched, an act of fiscal irresponsibility which is almost unparalleled in the history of this country.

What have the Liberals done on the tax side? They talk about tax relief. Whenever we ask the finance minister he stands up and blathers about how he has given the child tax credit and all this stuff but most of what they call tax cuts are in fact tax expenditures. They are government cheques that are being cut. That is the Liberal accounting.

If we account for the $10 billion annual increase in CPP premiums and the enormous effect of bracket creep which sucks up $2 billion to $3 billion a year out of the pockets of taxpayers just through inflation, what we find is that this is actually a tax increase budget. When we calculate the total net effect of the CPP payroll tax, the EI tax, the bracket creep higher income tax revenues and everything else and what they call their tax cuts, when we add it all up what we end up with is this budget being a tax increase budget. It is the fifth consecutive tax increase budget from a government that promised in the 1993 and 1997 elections not to raise taxes. Another promise broken. Another trust betrayed.

Since 1993 the government has taken a cumulative $49.1 billion from the pockets of taxpayers amounting to an average of $3,500 per taxpayer. That is more than was being taken. That is an increase over the enormously high tax burden of this government's predecessor.

When we take into account this budget and the future years projected in the budget documents, the government, when it closes its books in the fiscal year after the next one, will have raised taxes by a cumulative total of nearly $80 billion. That is $80 billion, or $5,700 per year for the average taxpayer. Compare that to what we have proposed in the official opposition which is to cut personal income taxes by $12 billion a year, or $2,000 for the average family by the year 2000.

Another little feature, or technical flaw as we might say, in the budget bill is the change being made to what is called the child care tax deduction. The government has decided to raise by $2,000 the amount parents can deduct in the cost of paying a third party to care for their children. That is fine. We respect the choices of people who decide to do that.

There are millions of Canadian families and parents who make the sacrifice to stay at home and raise their children to do what they believe in their conscience is best for their children. Do they get the benefit of the $2,000 additional deduction or even the $5,000 deduction that is there now? They do not get one red cent of it. They are told if they give up the second income they get no consideration under the tax code. It is a two tier tax code, one for the daycare choices the government supports and the other for families who want to make choices for themselves.

This bill is a disgrace. Closure is a disgrace. The lack of disclosure is a disgrace. The public accounting principles that are manipulated here are a disgrace. The unfairness for families is a disgrace. The $583 billion the government is passing on to future generations is a disgrace. That is why I and my colleagues will be voting against it.

Paul Crête Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC

Madam Speaker, I was in a good mood when I got up this morning, but this is a sad day, almost a day of mourning, for Quebec in this parliament today. Anger is brewing.

We are at third reading of a bill that will violate Quebec's jurisdiction over education. To make its centralizing vision clear and show how it totally disregards Quebec's provincial jurisdiction in this area, the government has decided to wrap up third reading in two hours. In practical terms, this means walking over the consensus, which is unanimous in Quebec.

Representatives of every student federation, deans of universities, people involved in all the various areas of education, came to tell us the same thing about this bill.

I will attempt to demonstrate to this House today why this is such a sad day for Quebec. In so doing, I will be sharing my time with the member for Saint-Hyacinthe—Bagot. I seek the unanimous consent of the House to do so.