House of Commons Hansard #69 of the 37th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was federal.

Topics

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1:15 p.m.

Liberal

Jim Peterson Liberal Willowdale, ON

Mr. Speaker, I thank the hon. member for his very generous words toward me. I can assure him and all hon. members that my thoughts are with them too.

Is he proposing that the meeting of first ministers for the purpose of reapportioning a tax base among the federal and provincial governments through the transfer of tax points would involve the transfer of tax points from the provinces to the federal government?

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1:15 p.m.

Bloc

Yvan Loubier Bloc Saint-Hyacinthe—Bagot, QC

Mr. Speaker, I would also like to welcome the member and wish him a speedy recovery.

However, I have to say that I am very disappointed with his diatribe. Each time we put sensible projects forward, we are told we want to destroy Canada. They do not need us to do that. They are destroying the country themselves by being as narrow-minded as they are, and by not even accepting the idea of a federal-provincial meeting. Really! A federalist is opposed to a meeting between his prime minister and the provincial premiers to talk about the efficient operation of the federation. This is really unbelievable.

They talk about the elimination of the deficit as if it were a miracle. Well if all miracles came about that way, we would never have seen one on the face of this earth. It is easy to have somebody else do the dirty work and then say it is a miracle. He did not see how the budget was balanced, that is for sure because it was done somewhere else, not here. It is the unemployed who did it, as well as the provinces. But I do agree, it is a miracle.

Could we strike some sort of a balance somewhere? It is not only the public finances that need to be balanced. Could he show a little more balance and admit that it would be a good idea, given anticipated surpluses of between $70 billion and $90 billion in the next four years, to talk about reapportioning the tax base?

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1:15 p.m.

Liberal

Jim Peterson Liberal Willowdale, ON

Mr. Speaker, I thank the hon. member for his kind words.

He said that the federal government does not want to meet with the provinces to discuss fiscal arrangements. If my memory serves me right, the Prime Minister and all the premiers had a meeting on September 11, last year. Under their historical agreement, the federal government transferred more than $23 billion to the provinces.

Is this the kind of Canadian co-operation the hon. member dislikes? Does he not want to have this type of co-operation between the federal government and the provinces?

If he wants to talk about problems, let me tell him quite frankly that since separatism became a force to reckon with in Quebec, we have seen a great deal of change.

I was living in Montreal in 1970. In those days, Montreal was the very best city in Canada and in North America. But since we have separatism in Quebec, it is a challenge to get investments and create jobs. I would like to see the day when Montreal will regain its past glory. All Canadians will work together so that this happens one day, with Quebec being part of Canada.

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1:20 p.m.

Bloc

Diane Bourgeois Bloc Terrebonne—Blainville, QC

Mr. Speaker, I have a question. The hon. member talked about nothing but powers throughout his speech. From the moment he stood up, he talked about powers.

I never felt any compassion whatsoever from the hon. member for the 1.3 million children living in poverty in Canada. I did not hear the hon. member say anything about the problem facing the families. He did not mention the fact that single mothers need social services, health care and education services.

There is also the fact that the federal government completely withdrew from social housing in 1994. It does not invest one cent in social housing anymore.

Does the hon. member opposite not think that it is high time to stop squabbling over powers and talking about separatism all the time, and to start thinking about the real people who need the money?

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1:20 p.m.

Liberal

Jim Peterson Liberal Willowdale, ON

Mr. Speaker, I congratulate the member for that question because, on this side, we agree totally with her ideas.

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1:20 p.m.

Some hon. members

Oh, oh.

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1:20 p.m.

Liberal

Jim Peterson Liberal Willowdale, ON

Let me say one thing. As far as children and working families are concerned, our investment in child benefits, which will reach nearly $9 billion annually, is one of the most considerable ever made for children and low-income working families.

What we have done for education is very important for the future of all our youth. Even when there was a deficit we invested in post-secondary education. We had a budget for education and invested enormously through various programs: chairs of excellence, Canadian scholarships, millennium scholarships and tax credits for students.

We have given enormous amounts to that sector and Canadian universities have thanked us for all we did in the area of education because education might just be the most important thing for the economic future of our country and for individual opportunities offered to each and every Canadian.

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1:20 p.m.

Bloc

Réal Ménard Bloc Hochelaga—Maisonneuve, QC

Mr. Speaker, with your permission, I would like to ask for the consent of the House to share my time with the member for Charlesbourg—Jacques-Cartier. In any case, I think it is in accordance with the standing orders.

It really takes quite a lot of nerve for government members to rise here in the House and tell us that everything is perfectly fine and to refuse to see a reality that the member for Saint-Hyacinthe—Bagot is not the only one to observe.

All the premiers, regardless of their allegiance, whether they represented a Progressive Conservative, New Democrat or Liberal government, including the former premier of Newfoundland and now Minister of Industry, came to the same conclusion as that of the Bloc Quebecois today. This conclusion is that, in the Canadian federal system, there is an incredible distortion between the pressure under which the provinces are to provide services to their citizens in vital areas such as education, health and social services, and the situation of the federal government, which accumulates surpluses and is involved in areas where the pressure is much less.

A number of experts have mentioned the paradox whereby this government got rich partly because of free trade, while it was opposed to free trade. Beyond the economic policies that it has chosen, this government has had recurrent influxes of money, only because a free trade agreement was signed.

This government was opposed to free trade. It had pledged to abolish the GST. The whole thing became so ridiculous that anglophones say that GST stands for “give Sheila time”. It became a well known fact that this government did not feel bound by its commitments.

The motion put forward by the hon. member for Lévis-et-Chutes-de-la-Chaudière is asking that, through existing mechanisms, a first ministers' conference be called to decide on the type of fiscal rebalancing that should be considered to ensure the kind of balance that is so important in a federation.

When I was a university student I learned—and I am sure I am not the only one who did—that federalism is characterized by the coexistence of two levels of government in a state of balance. If this is the case, then we must call this conference, because we desperately need to correct the existing imbalance.

Here are some figures which I find very meaningful. Between 1993 and 2001, federal government revenues increased by 53%. During that period, its expenditures went down by 3%. If its spending were reduced, one does not need a doctorate in economy to understand that it made cuts and offloaded a number of responsibilities, or that the pressure to provide services is not on this government, but on the provincial governments.

In the meantime, during the same period—no one can say that our numbers are not precise—from 1993 to 2001, program spending in Quebec, when considering all the programs administered by the Quebec government, increased by 16%. It increased by 32% in health care alone.

I would like members to remember that a year ago all the health ministers asked their public service—so it is not the member for Saint-Hyacinthe—Bagot or the member for Hochelaga—Maisonneuve or the member for Lévis—the public service of each province was asked by its health minister to see what kind of pressure will be put on the different health departments throughout the country in the coming years.

This led to a study that I have here witch says that for the next several years, not two or three years, but 15 years if the provinces want to provide exactly the same services every year, if all Quebecers who received health services last year expect to receive exactly the same services, the budget of Quebec's health minister will have to increase by 5%.

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1:25 p.m.

Bloc

Yvan Loubier Bloc Saint-Hyacinthe—Bagot, QC

Every year.

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1:25 p.m.

Bloc

Réal Ménard Bloc Hochelaga—Maisonneuve, QC

The hon. member for Saint-Hyacinthe—Bagot understands me well when he whispers to me that it is per year. That means that we will not come to the end of the tunnel if the status quo in the fiscal imbalance between the provinces and the federal government persists.

The 5% is attributable to the aging population, to the acquisition cost of medical technologies. For a hospital, acquiring a scanner may cost millions of dollars and that is only for a single hospital and one piece of medical equipment.

Do members know what item is currently the most costly in hospital budgets? It is the increased spending on drugs. That expense cannot be cut down, so over the next few years there will be significant increases.

Let us acknowledge something. Has there ever been in the history of Canadian federalism, in the history of this parliament, a more hypocritical government than the one opposite? Has there ever been one? No.

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1:30 p.m.

An hon. member

No, it is the worst.

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1:30 p.m.

Bloc

Réal Ménard Bloc Hochelaga—Maisonneuve, QC

Look at the situation. This is a government that is raking in surpluses. The hon. member for Saint-Hyacinthe—Bagot mentioned certain data from the finance minister's estimates. He was talking about a $60 billion surplus.

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1:30 p.m.

Bloc

Yvan Loubier Bloc Saint-Hyacinthe—Bagot, QC

His mistakes in estimates.

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1:30 p.m.

Bloc

Réal Ménard Bloc Hochelaga—Maisonneuve, QC

His mistakes in estimates were of about $60 billion. Not only has the government accumulated surpluses to the extent that we know, but year after year, despite the host of economists working for it, despite the econometric models that exist, despite the Department of Finance's powerful computers, it has been unable to estimate its assets and surpluses correctly—

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1:30 p.m.

Bloc

Antoine Dubé Bloc Lévis-Et-Chutes-De-La-Chaudière, QC

Or it made a mistake on purpose.

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1:30 p.m.

Bloc

Réal Ménard Bloc Hochelaga—Maisonneuve, QC

There is no doubt that it made a mistake on purpose. This regime is based on hypocrisy, it is based on smoke and mirror tactics. Do you truly believe that people will accept that? No.

Let me give a few examples. While the government has these huge surpluses, there is money to be paid. There are legitimate demands from the government of Quebec. These demands often come from both the Liberals and the Parti Quebecois. When dealing with such issues, there is a consensus in the national assembly.

Let us take an example with which I am very familiar, the expansion of the Palais des congrès. How many times did the Minister of National Revenue, who is responsible for the Economic Development Agency of Canada for the Regions of Quebec, rise in this House to say, in a bragging tone of voice, “We believe in regional development and we want to use taxes paid by Quebecers to promote development in Montreal and the regions”.

When the real test came, when the time came to get involved financially in structuring projects for Montreal, this government said no. It would not give anything, not even a penny.

We know about the tourism industry in Montreal. People from Europe and elsewhere come to Montreal to spend a few days and go to the Olympic stadium, and so on. But there is also what is called business tourism. That is what governments want to focus on, business tourism, not only pleasure tourism.

As a student, I was not as strong in economics as our finance critic, but I did take some classes where we were told “As the construction industry goes so goes the world”. The construction industry is very important. The government of Quebec paid for the expansion of the Palais des congrès all by itself, even though the federal government owes us $59 million.

The federal government could have taken this opportunity to support economic growth in Montreal.

I could give the House other examples like the ice storm. Hydro-Québec has submitted a claim for $400 million for losses incurred by crown corporations.

I see, Mr. Speaker, that my time is running out, although I feel like I have just begun. What I want to tell the government in conclusion is that everyone should support our motion, because it is not right for Ottawa to have all that money while so much pressure is being exerted on the services in the provinces.

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1:30 p.m.

Liberal

Tony Valeri Liberal Stoney Creek, ON

Mr. Speaker, I hesitate to use the word hypocritical. It is not my word. It was used by the hon. member across the way. What I find somewhat hypocritical is the fact that the Bloc is now recognizing tax points. This is great news.

I would inform the hon. member that when he is talking about the value of tax points with respect to health care, the value of the contribution by the federal government is 30 cents and not 14 cents.

I recognize the hon. member's comments about some of the other pressures that are on the health care system with respect to the change in demographics. The hon. member should recognize some of the other transfers that are actually made to the province of Quebec, such as 32% of the health research funds. Health care research is critically important to ensure a sustainable health care system.

While I respect the fact that the member can stand up in the House and engage in the debate, he should do so by recognizing the facts. The facts are that the contribution to Quebec by the federal government is substantially larger than the hon. member is prepared to recognize. I ask the hon. member to recognize that fact.

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1:35 p.m.

Bloc

Réal Ménard Bloc Hochelaga—Maisonneuve, QC

Mr. Speaker, I am going to ask our colleague on the government side to read the conclusions of the Clair commission. This commission is not the Bloc Quebecois or the government. The federal government is assessed as follows: “For every dollar spent by the Government of Quebec, 14 cents comes from the federal government, no more, no less”. When our colleague suggests that it is 30 cents, I respectfully submit he is out to lunch.

Second, as concerns research and development, with the fifty centres belonging to the federal government on the Ontario side—well, they are in the greater Outaouais-Ontario region, they are not on the Outaouais side, but on the Ottawa side—the figures given me are fairly dramatic. They date from 1999 and show that Quebec receives only 14.4% of the jobs in R and D.

Is our fellow member asking us to be satisfied with that? Is he asking us to keep a provincial and colonial mentality? If that is so, I say that on this side of the House we will never agree to that.

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1:35 p.m.

Bloc

Richard Marceau Bloc Charlesbourg—Jacques-Cartier, QC

Mr. Speaker, it is always intimidating to rise just after the very eloquent member for Hochelaga—Maisonneuve. However I will try to take the challenge offered so kindly to me by my colleague and friend from Montreal.

Since I have been listening to the debate I have had the feeling that government members have not taken the time to carefully read what we are debating. We are asking that the federal government call a federal-provincial first ministers' conference for the purpose of rectifying the fiscal imbalance between the federal government and the provinces in offering a new way to share the tax base, including through a tax points transfer that will respect the constitutional responsibilities of Quebec and the other provinces.

We are not asking to turn everything upside down, change the world or reinvent the wheel. We want a proper forum to be created to deal with a lack of balance in the tax system, which is acknowledged by most economists and stakeholders in Quebec and Canada.

The representations or questions raised by the Liberal member who spoke before me could or will be brought to the table by the federal government for discussion by the first ministers. I do not agree with his point of view. Instead of making demagogic speeches as he did, let us create a forum where such discussions will be meaningful because they will lead to concrete action within a very short time.

Let me say that the reason why government members will not vote for the motion is because they like the current situation which is part of Canada's nation building continuum, which started several decades ago and gathered speed in 1982 with the unilateral patriation of the constitution and is increasingly gathering speed since 1995.

This government is intent on turning the federal state that Canada should be into a unitary state. It is wants to weaken the provincial governments and turn them into big municipal governments, to rake in astronomical surpluses at the expense of the provinces so that Ottawa can wallow in money while the provinces have to take up increasingly difficult challenges with their heads barely above water.

While feeding mere crumbs to the provinces, the federal government is not just weakening them, it is also deciding on its own to dictate conditions on the transfer of new funds, impose national standards, bulldoze its own constitution—which sets out federal and provincial jurisdictions—to build a Canada that is more and more uniform nationally, a Canada that negates the specificity not only of Quebec, something which is crucial and essential, but also of other provinces.

We have many options. We still have in Quebec a continuous position that dates back to the Maurice Duplessis government. The Union Nationale governments of Duplessis, Johnson and Bertrand, the Liberal governments of Lesage, Johnson and Bourassa, and the PQ governments of Lévesque, Johnson, Parizeau, Bouchard and now Landry all had or have the same position. There is still a very broad consensus in Quebec that fiscal imbalance has been around for a long time and that it does exist. There is a consensus on this.

We know it only too well. We saw with the young offenders that there is no Quebec consensus that will stop this government. It is really a shame, and Quebecers will remember this when the time comes.

The member opposite talked about federal spending and said that the federal government gave more to Quebec than it deserved. That is what it boiled down to. I would like to respond, if I may, as follows. In 1997, federal government program spending in Quebec was $28.3 billion, or 23.9% of the total for Canada. That is less than Quebec's demographic share, which is 24.4%. But it is worse than that because when we take a closer look we see the form this spending took.

Quebec is over-represented when it comes to equalization payments and employment insurance—$2.9 billion more than its demographic weight—but under-represented when it comes to structuring spending, such as procurement of goods and services, investments and grants which represent $3.5 billion less than its demographic weight.

According to an independent organization, the Institut de la statistique du Québec, this under representation of $3.5 billion deprives Quebec of 45,500 jobs, which would account for half of the historic difference between the rate of unemployment in Quebec and in the rest of Canada.

When Premier Bernard Landry said that the federal system was not to Quebec's advantage, he went even further, and he was perfectly right. Other figures could be mentioned.

According to the Institut de la statistique du Québec, $100 million in federal government spending generates 920 direct and 381 indirect jobs. Spending of $3.5 billion would therefore mean 45,500 jobs in Quebec.

More specifically, this means that these jobs amount to one and a half times the number of jobs in all of the Gaspé peninsula; 80% of the jobs on the North Shore; two-thirds of the jobs in Abitibi—Témiscamingue; one-third of the jobs in the Eastern Townships; and one-third of the jobs in Saguenay—Lac-Saint-Jean.

The federal government is not giving Quebec its fairshare. Given the losses incurred by Quebec because of the fiscal imbalance and given the losses incurred by Quebec because the money spent by the federal government in Quebec is mainly passive money and not structural spending that generates economic activity, jobs and economic development, this is not only a criticism of the federal government—as we have said before, successive governments in Quebec have raised this question since Duplessis—it is a criticism of the system itself and of the logic of the system. It is imposing more and more constraints on Quebec, with the result that it has to face increased social spending. My colleague from Hochelaga—Maisonneuve was talking about this a little earlier. Quebec's social spending is increasing at an alarming rate. In health alone, it is increasing by 5% per year.

Quebecers are faced with the following choice. They do not have to choose between the status quo and the full and complete control over their development. They have a choice between Quebec sovereignty and an increasingly centralizing and unitary federalism, which is weakening the provinces a little more every day, riding roughshod over the Quebec nation, negating more and more the reality of Quebec, ignoring its consensus and personality, in fact aiming at making the Quebec nation disappear in the medium and long term.

This is the choice that the people of Quebec have. We will see that Quebecers will make the right choice and realize that the solution lies in full control over their development mechanism, sovereignty.

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1:45 p.m.

Bloc

Yvan Loubier Bloc Saint-Hyacinthe—Bagot, QC

Mr. Speaker, I would like to ask my colleague a question in connection with an intervention by a former parliamentary secretary to the minister of finance.

He said we were in an advantageous position as far as R and D investments are concerned, spending on laboratories. What is he thinking of? We hear on all sides that this is not the case, that Quebec is disadvantaged. The government side always turns up with miraculous figures and proportions. I do not know where they get them. I do not know what mental gymnastics they use to come up with them.

Would the hon. member be able to give us the truth?

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1:45 p.m.

Bloc

Richard Marceau Bloc Charlesbourg—Jacques-Cartier, QC

Mr. Speaker, first of all, I would like to respond to the question of the hon. member for Saint-Hyacinthe—Bagot as to where the figures come from. I too would like to know. I think the Liberals just pull them out of the air before they come here.

When we look at the future of R and D investment—we are in an increasingly wired world, and the future belongs to the most productive R and D people—federal R and D investments in Quebec represent 14.4%, which is more than 10% less than our population share.

I can hear my hon. colleague from Saint-Lambert say it is not so. These figures come from the Minister of Finance's own statistics, her minister, who says that 14.4% of research and development expenditures go to Quebec. The most flagrant example is that of the federal capital—the only national capital in Canada is Quebec City—where all R and D centres in the greater Ottawa region are on the Ontario side. There is not a single one on the Quebec side.

I challenge the hon. member for Saint-Lambert to find a figure other than 14.4% for federal R and D expenditures in Quebec and to show me an R and D centre in the Outaouais region on the Quebec side as opposed to the Ontario side. I send her this challenge. Let her take the floor to tell us what the figures are, if they are other than the ones I have given.

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1:50 p.m.

Liberal

Tony Valeri Liberal Stoney Creek, ON

Mr. Speaker, I just could not let the member's comment go by. To use his word, fabrication is the topic of the day. The fact that we are here debating this issue is, in a lot of people's minds, a fabrication.

From what I have heard to date, the Bloc is engaged in some phenomenal gymnastics. If the figure I provided earlier is not enough, perhaps the hon. member would want to get up and challenge the fact that Quebec receives 26% of the infrastructure dollars and 50% of the technology partnership fund which are actual dollars that flow directly into the province of Quebec.

Let us not dwell on throwing these numbers back and forth but let us recognize that there is a role for the federal government. The role is to maintain a united country that works for the best interests of all Canadians. That is something I do not believe the hon. member has with respect to his interest in being in this House.

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1:50 p.m.

Bloc

Richard Marceau Bloc Charlesbourg—Jacques-Cartier, QC

Mr. Speaker, if the Liberal member who just asked a question wanted to be honest, he should not be so close to the tree that he ignores the forest.

I will explain. It is easy to look at a program in isolation, but we should consider the whole situation. The figures for his own department are as follows: the Quebec share of federal spending on goods and services is 21%; its share of current transfers to businesses is 16.5%; its share of R&D is 14.4%. These figures come from his department.

It is quite easy to look at just one program. Instead of being too close to a single tree, let us look at the forest. When we do this, we realize that Quebec is being short changed.

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1:50 p.m.

The Acting Speaker (Mr. Bélair)

I must remind the hon. members that all members are honest.

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1:50 p.m.

Liberal

Steve Mahoney Liberal Mississauga West, ON

Mr. Speaker, I find it interesting that the only resolutions or ideas that come from the Bloc deal with taking money, power or both, and we know they are both the same, away from the federal government and giving increased money and power to the provincial government in Quebec City.

We know what the agenda is of the members from the Bloc but I find it curious indeed when I sit in this place and see the Leader of Her Majesty's Loyal Opposition stand in his place and rap his arms warmly around the Bloc's concept of stripping power away from the federal government and increasing it at the provincial level.

What we have here is a group in opposition who are indeed provincial politicians who should be selling their wares in the beautiful province of Alberta or in the province of Quebec. The reality is that there is a role, much to the chagrin of the Bloc Quebecois, for the federal government.

Mr. Speaker, I will also be splitting my time after question period with the member for Markham.

I find it astounding to hear members of a national parliament stand in their place, as a member opposite did, and refer to the nation of Quebec and to hear the Canadian Alliance agree with that. The reality is that there is no nation of Quebec. There is a wonderful province of Quebec in the nation of Canada. It is about time those members understood that.

I heard a member also stand in his place and ask when the Liberals were going to accept the consensus of the people of Quebec? I have a message for that member. Perhaps that member did not get it in the last election.

The Liberals won 10 additional seats in the province of Quebec in the last election. We accept that. We are quite happy to accept that. We have 36 or so people in the Quebec caucus representing the federal government in the province of Quebec.

The issue is not whether Quebec City, Toronto Queen's Park or Alberta should have more authority to take more money away from the people, or whether or not the federal government should deliver services. The real issue is that the provincial governments, and my province of Ontario is a classic example, having done this for years, continue to run a deficit while cutting taxes, which means they are cutting taxes while borrowing money to pay for those tax cuts. Someone help me understand where that fits in economics 101.

How can the province of Ontario, with a straight face, hand out to all hospitals around the province envelopes with $2 million, $3 million, $4 million, and $5 million for the purpose of buying capital equipment? When we add up the amount of money being transferred to the hospitals it just happens to be $294.5 million. That happens to be the exact amount of money transferred from the federal treasury to the province of Ontario for the purpose of acquiring new equipment. Is that not interesting?

How can the province then turn around and announce it will spend $114 million on children's services under the ministry of community and social services? When we look at the CHST and the amount of money transferred under that agreement to the province of Ontario from the federal government, it just happens coincidentally to be $114 million.

The real issue is how to make the nation work. I suggest there is a very important role for the government to play in terms of national standards. I say to the members of the Bloc Quebecois that there is only one nation. Outside of the one policy they have in their policy platform they are not bad parliamentarians, except that every once in a while that one policy, like eating a bad cucumber, comes back up.

That policy simply says that they want to destroy Canada. I have news for them. We will not let them do it under any circumstances. Under our watch there is no chance and no way that they will have success in convincing either Quebecers or Canadians that somehow we should split the country along provincial lines. It is not on.

I had the privilege of attending the FCM conference in Banff, Alberta, last weekend where I spoke to many people from Alberta and many people from right across the country. The people from Alberta love this country. They will not allow any kind of an unholy alliance between the Canadian Alliance and the Bloc Quebecois destroy what amounts to the greatest country in the world, a country of which we are all very proud.