House of Commons Hansard #132 of the 36th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was tax.

Topics

Economic Policy
Government Orders

1:10 p.m.

Liberal

John McKay Scarborough East, ON

Madam Speaker, I do not know what figures the hon. member is reading. My recollection of the budget numbers is that spending absent debt has basically been flatlined for the past two or three years. The management by this government has resulted in the ability of the government to significantly reduce debt. I would have thought that the hon. member's party would have been more than supportive of the notion that the nation's debt should be reduced. I do not see how the hon. member thinks he can have it both ways.

I cannot quite get my head around how the hon. member and his party in particular can criticize the mini-budget. Reducing taxes with cuts, which I understand to be the most significant part of the hon. member's party platform, by accumulatively $100 billion, is a pretty significant cut for Canadians across the board, both at the upper and lower ends. I cannot quite see how that can be criticized. I cannot quite see how putting back $21 billion over five years into the health care system can be criticized as a terrible thing. Over that period of time $21 billion is a significant sum of money.

We have also put money into technology research. We are in the bizarre situation of spending 9% or 10% of our gross domestic product on health care and having absolutely no idea how it is spent, where it is spent or by whom it is spent and of having to beat the provinces over the head just to have a reporting system. I support the position taken by the government on this for the simple reason that I would not want to continue to send money down a sinkhole until we knew exactly where the money was going and how it was to be spent. I would think I would have the support of the hon. member for the initiatives taken by the Government of Canada on that issue alone.

Economic Policy
Government Orders

1:10 p.m.

Liberal

Steve Mahoney Mississauga West, ON

Madam Speaker, I want to deal with a few specifics but I would rather talk a little about the philosophy of what the mini-budget is and what it is not.

First let me deal with what it is not. It is not a document that mirrors in any way whatsoever the philosophies or the attitudes of the Conservative government in the province of Ontario. I want to respond directly to my good friend the treasurer, the minister of finance for Ontario, Ernie Eves, who is quoted in the paper as saying “Give credit where credit is due. I think finance minister Martin is moving in the right direction. We have been preaching a lot of the stuff that Mr. Martin seems to have picked up on since 1995”.

Let me be clear. One thing we did not do which Mr. Eves and the Ontario government did do, is we did not borrow money to give a tax cut back to the wealthiest people in the country. How does one give a tax cut while continuing to run a deficit? That is absolutely crass politics at its worst. While we appreciate the fact that my hon. friend in Ontario congratulates the minister and the government for bringing in a budget that he seems to like, we do not need any lessons on how to balance our books, how to reduce the tax load, or how to pay down the debt. In fact, this government has shown true leadership in all of those regards.

I have been interested to hear some of the responses. I am sure the members opposite were busy with all the spin doctors yesterday trying to figure out how in the world they were going to criticize this without looking like they want to take back things that the government is giving to Canadians.

This is not a socialist budget, I can assure members. It is absolutely not. I heard the leader of the NDP stand in her place, and in a scrum, say that the government has clearly decided that its agenda is based on tax reductions. That is absolutely correct.

What does it do in terms of helping families? Let us take a look at some of the examples. This is what is so puzzling when I hear the socialists stand up and say that the government did not do enough here, that it did not do enough there.

A two-earner family of four with a combined income of $60,000 last year paid about $5,700 in federal tax. Next year their taxes will fall by over $1,000, a first year cut of 18%. A cut of $1,000 for a family of four, a husband, a wife and two kids, means that they have $1,000 more that they can use perhaps for their children's education, for a family vacation or to pay some bills they are behind on. Is that not all good social policy? It makes a lot of sense to me.

A single mother with one child earning $25,000 a year received a net benefit of just $1,400 last year. Next year she will receive an additional $800, for a total benefit of $2,200. Maybe the silk stocking socialists that inhabit the chairs in this place just do not think that $800 is a lot of money. Let me tell them that to a single mom in Mississauga $800 is a heck of a lot of money. She can use that money to benefit her children, to pay for something she needs, to help pay for their education or to help pay for their clothing. Of course it is a social benefit. Would the NDP take it away? Would it suggest that we not give that tax break?

A one-earner family with two children making $40,000 last year paid about $3,325 in federal tax. Next year they will pay about $1,100 less, a reduction of 32%. This is a family in which one spouse goes to work and the other stays home as a caregiver, with two children. They are saving $1,100. This is real money. This is real money back in the pockets of Canadians who need that money.

We absolutely have the financial house in order in Canada and we have turned around and given back that money to where it belongs, in the hands and the pockets of the hardworking taxpayers.

Let me say what it also is not. It is not a Bloc budget. Why? It actually strengthens Canada, which is clearly not on its agenda, not in its interests and not in its party platform. It would rather continue to drive wedges. Not only does this budget strengthen Canada, it benefits Quebecers, because a lot of the people I referred to, the two-earner family, the single mom, the one-earner family with two kids, live in Quebec. They are going to see that money coming back. Going into an election—let us admit that is what is going to happen—the people of Quebec are going to look at this and ask the Bloc why it is criticizing the fact that the Government of Canada is giving them back some of their money.

I can tell the House what this is also not. This is not a federal Conservative budget. We had a number of years of federal Conservative budgets under Brian Mulroney and, I might add, with the assistance of the current leader of the Conservative Party in this place who was a member of the Mulroney cabinet. With his assistance they managed to drive this country to the state where people were saying, in New York and other places around the world, that Canada was bordering on being a third world country, that Canada had run up a deficit, an overdraft, of $42 billion with no idea of how to pay it off.

The Canadian people had an idea. While we stand here and take credit for it, the true credit for eliminating the deficit, and for this budget, belongs to the Canadian people.

It is not a conservative budget. It is far-reaching. It is visionary. It sends a message to all Canadians that says the government knows they have suffered through years of cutbacks and years of turmoil, and it is time because we do have a surplus, not because there is an election. If there is an election in November or in April, what is the difference? There is a fall mini-budget or economic update that is done every year.

Those members know this. For them to suggest that the Alliance should be able to put out its policy book and tell everybody that it will do some of the nonsensical stuff it is talking about and that we should just sit back and do nothing, excuse me? We have a constituency in the country, a very large constituency. We are the only party with representatives from sea to sea to sea, everywhere in the country.

This mini-budget is not an Alliance budget, I can tell hon. members that. The Alliance claims that we have somehow stolen its ideas. What nonsense. It wants to put in a flat tax. I will be making a statement later about what that really is, a three-hump camel, so I will not go into it at the moment.

Let me just tell the House that the Alliance wants to bring in a flat tax. Do hon. members know why? Because it is simple for that party to understand. It can ask Canadians how they would like to pay 17% or maybe 25%. It thinks that is simple to understand.

What is the result of that? Add up the Alliance numbers. If the Alliance was putting out a budget of this nature it would turn the federal government into nothing more than a head waiter for the provincial governments right across the country. It would put the situation in such a disastrous state that all we would need would be annual meetings of first ministers who would meet somewhere, who knows, maybe in Charlottetown, or likely in Edmonton.

Economic Policy
Government Orders

1:20 p.m.

An hon. member

Maybe Mississauga.

Economic Policy
Government Orders

1:20 p.m.

Liberal

Steve Mahoney Mississauga West, ON

Yes, Mississauga. They would get together, ask how much the pie is and then say “Here is your share based on per capita”. They would eliminate regional development.

What that party has attempted to do to decimate the HRDC plans is a national disgrace, because the people it is hurting are the people who need the most help. We have heard members from that party say that they consider people in the maritimes lazy. We have heard them denigrate all the different groups in the country that we support and believe in.

We believe in economic regional development because it creates jobs. It creates pride. It creates self-respect for Canadians wherever they live in the country. Just because people happen to live in oil-rich Alberta does not give them the right to have a better standard of living than somebody who lives in Newfoundland or New Brunswick.

It is time to go to the Canadian people, put our two visions on the table and let the people decide.

Economic Policy
Government Orders

1:20 p.m.

Progressive Conservative

Peter MacKay Pictou—Antigonish—Guysborough, NS

Madam Speaker, I must say that natural gas emission rivals the massive Sable gas offshore project in my province of Nova Scotia.

Unfortunately, when I speak of gas, this mini-budget with its mini vision is really not going to offer the people very much other than more postdated promises until after the election. What we see happening is this approach by the government to come trick or treating to the Canadian public, just on the eve of an election, dangling these goodies out in front of the public only to pull them back unless it gets the vote.

My question for the hon. member is, with this so-called mini-budget, where is the vision? Where is the long term plan to tackle the deficit and the debt? Where is the long term agenda to try to pay down this national debt that we have?

What does this do for students? What about students who are wrestling with huge debts coming out of university and with no hope of getting on their feet or even a kick-start into the economy? Right now their choices are either to go bankrupt or to go to the United States. That is unfortunate and that is the environment they are facing right now based on what the government has set up. What are we going to do for students? What is the long term plan to deal with the debt situation?

Economic Policy
Government Orders

1:20 p.m.

Liberal

Steve Mahoney Mississauga West, ON

Madam Speaker, it is really interesting to get a question about debt and deficit reduction from a member of the Conservative Party.

With all due respect, this member was not here. Other members of his family might have been but he was not here during that time. The reality is that we do not need any lessons from the federal Tories about how to eliminate debt.

What we have done with this budget is wiped out $28 billion. It is gone, kaput, done.

Economic Policy
Government Orders

1:25 p.m.

Progressive Conservative

Peter MacKay Pictou—Antigonish—Guysborough, NS

Because of free trade. Don't forget that.

Economic Policy
Government Orders

1:25 p.m.

Liberal

Steve Mahoney Mississauga West, ON

The benefit of that amounts to $1.7 billion in payments that no longer have to be made. That is $1.7 billion that can be used to invest in students.

Economic Policy
Government Orders

1:25 p.m.

Progressive Conservative

Peter MacKay Pictou—Antigonish—Guysborough, NS

Talk about the GST.

Economic Policy
Government Orders

1:25 p.m.

Liberal

Steve Mahoney Mississauga West, ON

If the member would stop chirping, I will talk about students. Do not take my word for it. Take the media's word which talks about a $3,200 tax credit going to students to help them with their rent and their textbooks. I do not think the member has even taken the time to read the document if he actually has to stand in this place and ask what this does for students.

This is one of the most progressive documents, which will assist students right across Canada with research and investment, and R and D in the universities, money for textbooks and tax credits to help students pay their rent. It is visionary both in terms of eliminating the debt, with $28 billion gone now, and a commitment to reduce the debt every single year that we are in office.

Economic Policy
Government Orders

1:25 p.m.

NDP

Gordon Earle Halifax West, NS

Mr. Speaker, it is quite pathetic to listen to the member opposite trying to justify that this vote buying budget is anything other than that, and trying to put it in the realm of a budget that deals with social ills.

Everyone knows that a budget is usually something that puts forth the goals and objectives of a government and should be addressing the major issues in our society.

A major issue that has been dominating the news for the last number of months, which has slowed down a bit because the fishing season has closed, is the dispute involving the aboriginal people in Burnt Church and St. Mary's Bay. That is just the tip of the iceberg, illustrating that there is a need to deal with the problems confronting aboriginal peoples across Canada. This budget does nothing whatsoever to deal with any of those problems.

A big part of the problem relates to the residential schools and the fact that the Anglican Church is now almost being forced into bankruptcy because the government has failed to take a leadership role in dealing with the residential school problem and has failed to bear its responsibility in that matter. The budget does not address that issue and it does not address many other issues.

I ask the hon. member, what in this mini-budget does anything at all to deal with the very important issue around aboriginal peoples on reserve and off reserve?

Economic Policy
Government Orders

1:25 p.m.

Liberal

Steve Mahoney Mississauga West, ON

Madam Speaker, clearly this is not a budget. It is an economic statement. It says so right on the document. It is something that the finance minister does each and every fall as he sees how the economy is performing.

We committed during budget 2000 that we would go faster if finances allowed us to do so. This is the appropriate time.

I am sorry if the hon. member's party is not ready with its platform. However, very clearly the government has an obligation to say to Canadians “Here is where we believe we should be going with your economic future and we want to put exactly what we are prepared to do on the table”. That has been done with this document and it clearly shows the vision for the country.

Economic Policy
Government Orders

1:25 p.m.

NDP

Lorne Nystrom Qu'Appelle, SK

Madam Speaker, I am pleased to follow that member of the Mike Harris cabinet across the way talking about his very conservative budget. I see he is putting his earphone on. I said that I am very pleased to follow that fan of Mike Harris who spoke on the budget a few minutes ago.

The ghosts of Liberals past must be rolling over in their graves when they think of the sharp turn to the political right, this very conservative budget, this mini-budget we had delivered in the House yesterday by the Minister of Finance.

I have seen many budgets over the years but this is the most conservative, right wing budget I have seen in the last 25 years in the House of Commons. It is more conservative than Brian Mulroney, more conservative than the former Prime Minister who is now the leader of the Conservative Party.

This is a millionaire's budget. It is a Bay Street budget, with $100 billion in tax cuts skewed to the wealthy and the rich. If someone is making $300,000 or $400,000 a year, if someone is a millionaire or a golf partner and buddy of the Prime Minister making $400,000 or $500,000 a year, he will get anywhere from $20,000 to $50,000 in tax cuts depending on capital gains. A single person making $30,000 in Pembroke receives a tax cut of only $521 a year. Compare this to the millionaires who are going to receive $40,000 to $80,000 a year on tax breaks. That is a sharp turn to the right by the Liberal Party which has been influenced by the Canadian Alliance and by the politics of Mike Harris. The ghosts of Liberals past, leaders like Lester Pearson, Pierre Trudeau and Allan McEachern must be pretty disgusted with the government they see across the way.

Let us look at the facts. There are $100 billion dollars in tax cuts with only about $21 billion going into health care, social transfers, welfare and education. That brings us up to 1994 levels only. There are also at least $31 billion in terms of paying down the national debt.

The very size of government programs is dropping faster now than at any time in the history of Canada. The government is taking money away from social programs. When it took office at the end of Brian Mulroney's term, government programs amounted to 17% of the GDP. They now amount to about 13% of the GDP. The projections in the mini-budget, by the end of the next term if it is a majority government that lasts four or five years, will be under 11% of the GDP.

The government is taking money out of health care and education. It is providing less money for the environment. It is doing nothing about our farm crisis. This is a government leading a country, one of the few countries in the world without a national highways program, that has decided not to put money into highways. This is a government that is devising a tax system that is not as equitable as it is giving big breaks to wealthy people. This goes in the wrong direction.

If we look at results of polls and surveys we find that most people in Canada want more money put into health care. If we had a poll and asked people what to do with a surplus, whether it should be spent on massive tax cuts that favour wealthy people or put into health care and education, about 75% of the people would say that we should put more money into health care, education and the environment. That is the direction in which the Canadian people want to go. Those are the values Canadians want pursued. The Liberal Party, like the Canadian Alliance, wants to give more tax cuts to wealthy people.

Why is this done? The Liberal Party has been drafting a very cagey election program and strategy. What we saw yesterday was a move to the political right to capture votes from the Alliance and the Conservative Party in the 905 belt around Toronto, the wealthy areas around Toronto, the Mike Harris belt around Toronto. The big issue there is tax cuts so the Liberals are going to cater to that and they have taken the Canadian Alliance program. The Liberals left the Leader of the Opposition without a plank.

We are going to see the election announced on Sunday. The Liberals will come out with another red book and then they will shuffle to the left. They will talk about investing in education, in the environment, in people's programs and things of that sort. That is what the Liberal Party is doing with this particular economic statement before the House today. This is like the steak and the sizzle. This mini statement is giving a lot of steak to the wealthy and the privileged and only the sizzle to the poor and ordinary citizens.

There are many programs that should have been enhanced. Health care is the very best example of that. In 1995 we had the biggest cutback in our history in health funding than we have ever seen. That came from a party that at one time initiated a national health care system where the federal government paid 50% of health care. Before some of the money is reinstated, through the agreement of the first ministers' about a month ago, the cash funding for health care had fallen from 50% to 13 cents or 14 cents on the dollar. Even with the $21 billion in social transfers, the cash into health care only goes up to 1994 levels.

Where are the priorities? The Canadian people fought to get rid of the deficit. It is the Canadian people, through their hard work and their energy, who have created a surplus in this country. I argue that the majority of that surplus should be spent on the social deficit that was created by the cutbacks of the Liberal government from 1995 on.

I am sure that if the minister of financial institutions across the way had his way he would agree with me that more money should be spent in the social pocket rather than on wealthy tax cuts for his big powerful friends on Bay Street. However, that is the way the government has gone and that is not the right way to go. That is not the vision of a new Canada. That is not a vision of equality, a vision of justice or a vision of sharing. Those are the values that the Canadian people stand for and the Canadian people want.

If we look through the mini statement from yesterday there are many things not mentioned at all. I think of my own province of Saskatchewan. I have already talked about health care. Health care was started in Saskatchewan by the CCF, by Tommy Douglas and by James Shaver Woodsworth many, many years ago. After fighting against the Liberals year and year out, health care became a reality.

The Liberal Party promised health care in 1919, the year that the minister for financial institutions was born. It was promised in 1919 but it did not become a reality until the mid-1960s, 40-odd years after promising it to the Canadian people. It is only there because it was pushed and prodded by the CCF and the NDP who started health care in Saskatchewan back in 1961.

In 1961 when health care became a very volatile issue in our province, when there were organizations led by the doctors and others to stop medicare—they called it socialized medicine in those days—the Leader of the Opposition was Liberal Ross Thatcher. He was one of the leaders in the fight against health care in this country. He went into the legislative assembly with a photo op, and he kicked the door of the legislative assembly in opposition to health care in our province.

Health care was so popular with the people that public opinion was mobilized. Through the mobilization of public opinion it was forced on the Liberal government in 1965 or 1966 and the government of Lester Pearson brought it in across the country. The Liberal government had been forced by the CCF and the NDP, which shows the influence of a social democratic party as setting a popular agenda of equality for the Canadian people.

That whole agenda has now been highjacked because of a paranoiac fear of the Canadian Alliance. What the Liberals are doing is adopting the Alliance policy and moving sharply to the political right through $100 billion tax cut. Even the Minister of Finance himself a while back was ridiculing the then Reform Party for talking about a $50 billion or $60 billion cut in taxes. What does he do? He betters that with some $100 billion at the expense of the ordinary Canadian people and the programs that make this country so definitely unique from the United States of America.

We have the CA and the Liberal Party catering to the wealthy and to the privileged. We saw that last night at a dinner in Toronto where the corporate elite gathered. Tables were sold for this dinner. I watched the television last night to see how many ordinary grassroots Reformers there were from Wymark, Moose Jaw, or Kindersley, Saskatchewan or Brandon, Manitoba. I watched to see how many faces I would recognize of the ordinary people from Yorkton. Does anyone know how many I saw? I did not see any. I wondered why. Does anyone know why? It was because the cost of a table was $25,000. Some grassroots party, catering to the business arenas on Bay Street, to the big banks and the big financial institutions.

The old Reform Party is dead and gone, the so-called grassroots party that protested against this kind of elite gathering. We now have a new Bay Street party in the Reform Party; $25,000 a table. They were sipping champagne. They were pigging out on caviar. The party of the so-called grassroots people that rebelled against Brian Mulroney, rebelled against Bay Street, rebelled against this kind of imperial power, rebelled against these back room deals, has changed its skin. Now it represents the party of the wealthy, the rich and the privileged. That is the new Canadian Alliance, the old Reform Party.

What does the Liberal Party do? It gets scared. It is afraid. It is afraid of this new party that is rising so it moves sharply to the right. The member from British Columbia over there is crying in his seat. He is afraid as he weeps in the House of Commons.

What is in this budget? What is in this budget, for example, for the farmers of western Canada? I can see the headline “Farmers: An Endangered Species Survey”. A report from Statistics Canada says that there are 22,100 fewer farmers in the prairies this fall than last fall. The reaction it said was jaw dropping from economists across the prairies. Yet we had a surplus of $100 billion over five years to work with. What is there for the prairie farmer? There are 40,000 fewer farm workers in the prairies.

Farmers came to Ottawa last year asking for some help. The Europeans massively support their farmers. The Americans massively support their farmers. The government does diddly-squat. There is nothing in the budget at all.

We had a big deficit. The Canadian people won the deficit battle and now there is a big surplus. Where does the surplus go? It goes to $100 billion on tax cuts. Where does the surplus go? It goes toward cutting capital gains for speculators and wealthy bankers. The surtax on the rich is gone. The tax bracket was dropped in terms of what the rich pay in taxes in this country. All kinds of tax breaks have been given to the banks and we have 22,000 fewer farmers on the prairies.

I am surprised at the government across the way, but we have the Canadian Alliance going one step further. It does not like any support for farmers. The Alliance leader was in Regina back in August. Does anyone know what he said about the Canadian Wheat Board? He said that it should be voluntary. He said that if the Canadian Wheat Board was not a single best seller then it would eventually be eliminated and eliminated very quickly. That is exactly what the Canadian Alliance wants to do.

Then we had the member from Interlake who was saying a few days ago that the big drop in farmers is really a structural readjustment. That is the sensitivity we have from the official opposition.

What does the government do? It makes no response. There is nothing there to help our farmers in a time of need. These are things that were missing in the mini statement made by the Minister of Finance in the House of Commons yesterday.

I look again across my riding and across my province. I see a highway system that is collapsing because the government across the way has allowed the rail lines to be abandoned forcing farmers to take their grain to market in large trucks. The highways are being destroyed and yet there is no money for a national highways program to help rebuild the infrastructure of rural Canada and rural Saskatchewan.

Where is that money? That money has gone to Bay Street and to the wealthy. It has gone to pay down the national debt very rapidly and to pay off the bond holders on Bay Street. Where is the money for the ordinary people in Cupar, Dysart, Wynyard, Elfros, Raymore, Qu'Appelle and all those other places across Saskatchewan to make sure the highways are rebuilt?

It is a question of choices and a question of priorities. The Liberals made their choice and their choice does not synchronize at all with the preference of the Canadian people, which is to reinvest in people's programs and in a new deal for people.

Economic Policy
Government Orders

1:45 p.m.

The Acting Speaker (Ms. Thibeault)

It being 1.45 p.m., pursuant to order made earlier this day, the House will now proceed to consideration of Bill C-45 in committee of the whole.

House in committee on Bill C-45, an act respecting the provision of increased funding for health care services, medical equipment, health information and communications technologies, early childhood development and other social services and to amend the Federal-Provincial Fiscal Arrangements Act, Ms. Thibeault in the chair.

Canada Health Care, Early Childhood Development And Other Social Services Funding Act
Government Orders

October 19th, 2000 / 1:45 p.m.

The Assistant Deputy Chairman

Order, please. House in committee of the whole on Bill C-45. Shall clause 2 carry?

(On clause 2)