House of Commons Hansard #83 of the 38th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was budget.

Topics

Ways and Means

April 15th, 2005 / 10 a.m.

Mississauga East—Cooksville
Ontario

Liberal

Albina Guarnieri Minister of Veterans Affairs

Mr. Speaker, pursuant to Standing Order 83(1) I wish to table a notice of a ways and means motion to introduce an act to provide services, assistance and compensation to or in respect of Canadian Forces members and veterans, and to make amendments to certain acts.

I ask that an order of the day be designated for consideration of this motion.

The House resumed from April 13 consideration of the motion that Bill C-43, an act to implement certain provisions of the budget tabled in Parliament on February 23, 2005, be read the second time and referred to a committee.

Budget Implementation Act
Government Orders

10:05 a.m.

Conservative

Joe Preston Elgin—Middlesex—London, ON

Mr. Speaker, I rise today to speak to Bill C-43, a bill reflective of the arrogance of the government. Before I speak to specific financial items, let us discuss why this piece of legislation is so large and includes items that should be put forward as stand-alone legislation.

I refer to the Atlantic accord, a promise made to the people of Nova Scotia and Newfoundland and Labrador, that is buried in this legislation.

The Prime Minister feigns support for this accord, but holds the provinces hostage by linking it, or perhaps I should say burying it, in the bill. The accord should be presented as stand-alone legislation. The government has dictated to the country for too many years and this level of legislative manipulation must stop. I and the Conservative Party see it, and the people of Canada agree.

The other item lumped into the bill is the so-called Kyoto plan. This conniving government knew the Kyoto measures were distasteful to the majority of the House, so it piled them into the bill to delay legitimate budget measures or at least put them at risk.

Let us turn to the budget measures in the bill. We should ask ourselves of the unfocused and wasteful practices of the government and allow Canadians to decide if the people handling our purse strings have the right stuff.

Certainly in the areas of projecting surpluses we have been woefully represented in the past and in the present, and using past behaviour to predict future ability, the government will not be able to predict correctly again.

Let us speak of our surplus predictions which in fact continue to result in the overtaxation of the Canadian people to the tune of billions and billions of dollars each year.

If honest business people in the country were to inadvertently overcharge their customers, I believe in each case an attempt would be made to find the customer who has been overcharged and rightfully refund the difference. However, the government chooses not to attempt to return this overtaxation to its rightful place. It uses it at its whim.

I may have just made two mistakes. I compared the government to the honest business people in Canada and with the current reputation of the government, I am afraid I have insulted the business community. I also said that if persons were inadvertently overcharged and the surpluses were inadvertent; however, I do not believe these surpluses were inadvertent.

That having been said, about the inability of the government to predict financial outcomes, is the reason why the Conservative Party continues to ask for the creation of an independent parliamentary budget forecast office. The government has announced so many items in the budget which will simply not occur for years to come. Most, if not all, of the tax relief in the budget is back end loaded. It will not be a benefit to the hard working people of Elgin—Middlesex—London and indeed all of Canada for several years.

The government has made announcing an art form. Every piece of news is announced again and again, and sometimes even again and again. Canadians continue to be retold each idea. Is this the trial balloon method? Does the government simply announce plans to the Canadian people in budgets and throne speeches to test the drive of Canadian voters with its schemes?

It announced this year's tax relief schedule for some time in 2009 to provide some perverse guidance as to whether anyone out there likes it or not. If they do not, it does not really ever take place anyway. I suspect that a great many items in the budget fall into this category.

The personal tax relief measures in the bill are insufficient. They amount to a reduction of no more than $16 next year and if we can wait until 2009, there are plenty of paltry goodies for us. This is a bait and switch game that the taxpayers of the country do not want to play.

Let us discuss tax cuts. I have already mentioned the personal tax cuts. Let us discuss the increase in the guaranteed income supplement, as paltry as it is, and the years of waiting it will take for it to come into effect. It may all be for naught as provincial governments allow for clawbacks or seniors in subsidized nursing homes will have this amount simply taken by the nursing home. Is this how we honour our seniors?

Let us discuss the air travel security charge. This is a tax on business, tourism, and on travelling Canadians. A meagre reduction of this tax will not result in any meaningful difference in airline fares. This continues to be yet another tax grab by the government.

Here is an example of the changes. The basic tax for flights in Canada is now $4.67. This is a reduction from $6.54. That is $1.87 per flight. Wow, I can buy a cup of coffee. Wait, no I cannot because airport rents in Canada are so high that any savings must be eaten up by increased airfares to cover these rents. What happened to the airport rent reductions?

The Conservative Party members in the last election set plans and priorities for both tax cuts and investments committing nearly $58 billion over five years. They were told by the government that they were being irresponsible, that the Conservative Party was just wrong. However, just 10 or 11 months later here we stand with a budget to almost the exact amount we had said.

Not only were Canadians being told it was affordable all along, again we have the arrogance and manipulation that only this government can be right. If anyone else finds a better or more responsible way, they are wrong, at least temporarily wrong until the government takes their ideas to make them its own. So again, it was just a political ploy at election time to discredit the Conservative Party and to prevent Canadians from electing a good, honest government.

This brings me to the area of management and I may repeat some, but it needs repeating. We as Conservatives have asked the government for tax relief for low and middle income Canadians. It has become more and more evident of late that despite bragging about great reductions in taxation, Canadians continue to say “show me the money”. Despite stated reductions in taxation, the hard-working people of Elgin—Middlesex—London and the rest of Canada have less money in their pockets.

We must find a way to both offer needed services for the citizens of this great country and to stimulate growth of our economy. We must ensure that all money taken from Canadians in the form of taxes or taken in payroll deductions or in fees by the government is treated with the respect it deserves.

We must remember the source of these funds: the pockets, the wallets, the bank accounts, and the piggy-banks of Canadians. These funds belong to the people, not the finance minister. It is the job of the government to wisely collect, account for, and prescribe spending that this country needs to support its people remembering that the money belongs to the people. We must ensure that only the amount needed to accomplish the needs of Canada is taken from citizens and that the habit of huge surplus budgets must end. We must, as suggested, implement a fully independent process for forecasting the government's financial situation.

The government has proven that either through deceit or ignorance it cannot be trusted to take billions and billions more from the taxpayer. If we just leave these funds with Canadians in the first place, we will save the cost of collection and influence the disposable income of all Canadians. The government must also ensure that tax dollars and other funds sent to the government must also be treated with the respect they deserve. We must erase waste. The government has a legacy of waste, mismanagement, and now corruption.

Canadians value their earnings more than the government. The waste of the sponsorship debacle, the gun registry fiasco, and budget errors, all have permanently set into the minds of all Canadians. Many Canadians cringe each time they send money or have it taken from them. They think of the wasteful way in which it is about to be spent.

Canadians are fully aware of the hoax of our employment insurance funding. So many young, low income earners are stolen from on every paycheque, EI deductions are made for a program they can never use. Employers then pay matching contributions into a fund that should be used as an emergency support fund to assist workers. Out of no fault of their own, the government uses their money as it sees fit.

In summary, let me say that this bill and this budget have some glaring faults.

It is a disservice to the people of Nova Scotia and Newfoundland and Labrador to have the Atlantic accord lumped into this bill. The Conservative Party continues to believe that its separation into stand-alone legislation would be best for Newfoundland and Labrador and Nova Scotia.

The Conservative Party and most of this Parliament would like to see the Kyoto measures separated from this budget so they can be discussed on their own merit or lack thereof.

If one practises something long enough, one gets good at it. Over a decade of Liberal waste, mismanagement and scandal, billions of dollars sent to Ottawa would have been much better left in the pockets of Canadians.

The Conservative Party has said that it will strive to make this minority Parliament work so long as it is in the best interests of Canadians. Currently this bill is not reflective of that principle. We will work to try to turn this bill into legislation that is in the best interests of Canadians.

Budget Implementation Act
Government Orders

10:15 a.m.

Liberal

Derek Lee Scarborough—Rouge River, ON

Mr. Speaker, the debate today is certainly going to be interesting, but I cannot help but respond to the member's reference on the budget planning process. He seemed to take umbrage with the fact that the government has had a surplus this year, last year and the previous year.

Would he not accept that the existence of a surplus involves two separate things? The first is that it is a legitimate part of the budget planning process, whereby we do not plan to have a deficit; we plan to do better than break even. When we spend $150 billion a year, trying to get that dollar right on the money is difficult, and this government has decided to err on the side of caution and build in contingencies so we will inevitably end up with a surplus rather than a deficit. I think Canadians are happy with that. The second point is that every bit of our surplus, whatever it happens to be, and if there is one, gets applied to the national debt, which is a little heavy. We are making good progress on it.

Would he not accept those two elements in the budget planning process and would he not accept that his criticism of a surplus is a little over the top and a little unfair to Canadians?

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10:15 a.m.

Conservative

Joe Preston Elgin—Middlesex—London, ON

Mr. Speaker, what is unfair to Canadians is the amount of money taken from their wallets each and every year that is over and above what this government needs to do the job it is asked to do.

We have had eight years of surpluses. In each of those years there have been budgets that have had contingency funds in them. We need not mix up what the contingency fund is versus the surplus. We allow a flexibility in budgeting by allowing the contingency fund to be there for emergency use, but to then add to that another $9 billion or $10 billion worth of surplus is just excessive taxation on the backs of the people of Elgin—Middlesex—London and the people of Canada.

We have had eight years of surpluses. In each and every case, the surplus has been projected to be minuscule compared to where it has ended up. This is just poor planning and excessive taxation. As I stated in my debate, this is like walking into a store and being overcharged, with the owner of the store not caring whether we ever get our money back.

When my good citizens of Elgin—Middlesex—London send their tax dollars to Ottawa, they expect that those dollars will be enough to cover the difference. When they find out that the government has taken percentages more than it needed to do the job, they expect that perhaps they will get some value back for that money.

The member mentioned paying down debts and adequate use of surpluses. That tends to happen only when the surplus is discovered after the year has ended. If the surplus is discovered while the year is still in existence, then of course it goes to this government's whims and the spending non-priorities of this government.

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10:20 a.m.

Bloc

Guy Côté Portneuf, QC

Mr. Speaker, my Conservative colleague has expressed very well the tendency of this government to underestimate surpluses over at least the last eight years. What we have seen in the last eight years is in fact much more serious. Overall, we can say that the government is quite good at estimating expenditures, which are usually in line with its forecasts. The problem lies mainly with the revenues, which are consistently underestimated.

Recently, the Standing Committee on Finance heard some officials of the Department of Finance. We told one of them that we found it quite strange that the Department would consistently underestimate its revenues for eight years. The official's answer was exceptionally candid. He said that the Department of Finance had to calculate an average of the surpluses or a fiscal balance average, but that it could not be done on a ten year period. The figures have to be calculated every year. However, the government's budget is based on a five year period. The finance minister should, perhaps, be talking to his officials.

As far as debt repayment is concerned, there is no budgetary item in this budget for the debt repayment. What we have seen in the last eight years is accounting calculations, macroeconomic calculations, and what I now call creative calculations through contingency reserves, prudence reserves and ministerial anxiety reserves.

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10:20 a.m.

The Speaker

The hon. member for Elgin—Middlesex—London for a short answer. His time is almost up.

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10:20 a.m.

Conservative

Joe Preston Elgin—Middlesex—London, ON

Mr. Speaker, my friend is absolutely right. The expenditures have been almost exactly the same in each budget. They have certainly known how to plan their spending. It continues to increase.

With what the Liberals have done for eight years, it is no wonder that there is no area in the budget that talks about debt retirement. Apparently even the IMF is critical of their budget planning from a surplus point of view. In each of the past eight years they just simply have had a surplus. That is what they use it for. They no longer have to plan debt retirement. They know they will have a surplus because of the poor planning they use to plan the surplus in Canada. They take the money from the good hard-working people of Canada and they have it left over at the end of the year.

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10:20 a.m.

Liberal

Marlene Catterall Ottawa West—Nepean, ON

Mr. Speaker, this legislation is about implementing the budget delivered in the House on February 23, which implements many of the commitments made to Canadians by the government during the last election campaign and which were reaffirmed and expanded on in the Speech from the Throne. The budget is about planning for the future. What is going to be done to make this a better country, to make our communities better and to make life better for all Canadians?

I want to talk today about the fastest growing segment of our population and that is people over the age of 65. In particular, my riding has the third highest proportion of seniors of any constituency right across Canada, second only to Victoria and St. Catharines.

Measures in the budget to make seniors' lives better are extremely important. That is why I want to offer one comment on their behalf to the member who just spoke, because part of planning for the future is paying off one's debt. The seniors I speak about this morning have lived a long time. They have owned homes, they have had mortgages and they know the value of paying off one's debt or credit cards and saving on interest, which the opposite side seems not to understand. Perhaps opposition members prefer to see us continue to have rising interest payments rather than paying off debt and saving $3 billion a year on interest payments, which is money that we can invest in programs that are important for our citizens.

Obviously for many seniors who raised their families and grew old through much more difficult times than we are experiencing in this country today, enough to live on with dignity and comfort in retirement is extremely important. That is why a number of measures in the budget are very important to seniors.

For one thing, the guaranteed income supplement that goes to any Canadian senior below a certain level of income is increasing for the first time since 1984. There have been annual increases to cover the cost of living, but for the first time in 21 years there is an increase in the budget to the basic amount of guaranteed income supplement. That will benefit single seniors to the extent of $400 a year and couples by $700.

In total, that is an amount of $2.7 billion being dedicated to our lowest income seniors. The amount of $2.7 billion happens to be coincidentally close to the amount we are saving on interest payments every year because of the debt repayment that the government has made with its surpluses.

The other important thing for seniors on low incomes is increasing the basic income tax deduction to $10,000. When fully implemented, this will take 240,000 low income seniors totally off the tax rolls of Canada.

As people live longer, they are also staying more active. That is why the new horizons program is very important. In my riding there are numerous volunteer organizations, many of them run by seniors themselves. They provide programs and activities and get people out of their homes and involved with the community. I am pleased to note that we will be more than doubling the new horizons program in the next two years from $10 million to $25 million, allowing for more programs for seniors, more activities and more involvement with the community.

Many seniors are not so lucky and in fact need caregiving either by family or somebody else outside the home. That is a very expensive thing for families or for the seniors themselves. This budget doubles from $5,000 to $10,000 the amount that can be deducted in regard to the costs to provide the care for someone who needs it, care that costs money.

Increasingly this population will require special measures in a large number of areas. It will be an ever more significant part of the population of Canada. That is why establishing an national seniors secretariat to look at the ongoing and new needs of seniors is extremely important. I mentioned that many seniors stay much more active, much longer, but living longer also means more health problems such as mobility and eyesight. What we have invested in health care is also extremely important to seniors.

I know there is a lot of skepticism about whether the additional nearly $100 billion since 2001 we are giving to the provinces for health care is going to really make a difference. The difference this time is we have agreed targets with the provinces for improving wait times by two years from now. That amount of money also contributes to ambulatory and community care for people who need it, that includes a lot of seniors. The focus is very much on those diseases and conditions that affect seniors such as joint replacement, cancer, heart problems, and ensuring that diagnosis and treatment is available faster.

However, just as important is the money we are investing in public health. If we need more and more health care and treatment of illnesses, which does happen with an aging population, one of the ways to keep our public health care system sustainable is to ensure we do everything possible to keep Canadians as healthy as possible. In a couple of weeks I will be holding a forum in Ottawa West--Nepean with the Minister of Public Health to get the ideas from our community on how we keep all our citizens healthier, our children, our families, our seniors.

Seniors also benefit by the new money that will go to communities and cities, through forgiving the GST and transferring an increasing portion of the gas tax to municipalities. For seniors living in their own homes, property taxes can be a huge burden. They may have wonderful old homes, but their incomes have not kept up with what is required from them in the way of taxes. By transferring $600 million this year, and that goes on every year, increasing to $2 billion by the year 2010 to our cities, that will relieve the demands they have to put on property taxpayers to pay for things like roads, clean water, sewers, parks and recreation programs. That directly benefits seniors who often have the hardest time paying higher property taxes.

However, seniors care about more than their own interests. They have also worked very hard and sacrificed a lot to educate their sons and daughters. They want to be sure that their sons and daughters can use their education in their jobs and careers and that their grandchildren or great-grandchildren will be well looked after. That is why the national child care program is also important for seniors. It allows their children to live the lives that they have educated and raised them for and to live the most productive lives they can.

I want to also mention that seniors want the best possible lives for their children, grandchildren and great-grandchildren. In the budget money has been dedicated toward cleaner water, cleaner land and cleaner air. A planet that we can survive on is also important for seniors. They know and I know that long after we are gone, our grandchildren and great-grandchildren will be living with the decisions we make today on how to protect the environment of our world. That is one element of the budget that I am extremely proud of as well.

On behalf of the many seniors who I represent, while there is not everything in the budget I would like to see, there is a great deal there that will make life better for seniors in Canada.

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10:30 a.m.

Conservative

Charlie Penson Peace River, AB

Mr. Speaker, I listened to the member from the Liberal side of the House talk about the surplus. It is a good thing to have a surplus in the budget. However, I would remind her that for the past eight years her government has lowballed the surplus to the tune of almost $80 billion in terms of the amount over eight years.

We had the CEO of the congressional budget office before our finance committee. She talked about the independent budget forecast of the Americans. She told us that either the administration or the independent budget office could be out, but they were not consistently out one way all the time. In other words, they do not consistently overestimate or underestimate. There are a lot of variables. In fact, it would be wrong on the low side as often as it would be wrong on the high side.

I put it to the member that what this does is hurt the credibility of this government. It hurts the credibility of the industry that is assisting it. At a time when we have had a real flurry of corporate malfeasance across North America, I would think the finance minister and the government would want to be as credible as possible.

Only six weeks after the budget was presented on February 23, the fiscal forecasters hired by the finance committee has hired, have already said that the finance minister's figure is not accurate. They are already saying that it is $3 billion higher than six weeks ago.

I see that the member is getting some help from the parliamentary secretary. I do not think it will help because this is indefensible.

The Liberals are at it again. How does this member defend the practice of lowballing surpluses all the time?

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10:35 a.m.

Liberal

Marlene Catterall Ottawa West—Nepean, ON

Mr. Speaker, I would hardly be quoting the United States as a fine example of budget planning. Look at its deficit and rising debt. Look at how much Americans are paying in interest alone. This money is not going into providing health care. The Americans have a system with 40 million people with no health coverage and most of them are women and children. Is that the sample the member wants to put in front of this House and in front of Canadians as what we should be striving for? Thanks, but no thanks.

I spoke about seniors. Every senior understands the importance of saving for a rainy day, and that may be an old fashioned expression. If the government plans exactly what it thinks it will spend and receive, if revenues do not meet the expenses and if there is a sudden crises, such as the Persian Gulf war or the tsunami with which we want to help, we cannot afford it without going into debt.

If we budgeted the way the member opposite would want us to do, then we would be back where we were when we were in opposition, between 1988 and 1993, listening to repeated budget promises about getting out of the deficit and balancing the books. Instead the debt kept going up, the interest payments kept going up and services for Canadians kept dropping year by year.

I would rather err on the side of caution and pay off a bit of debt at the end of the year. I think most seniors and most Canadians want to see us pay down that debt. They know that means we save money in interest every year. This is money that we can spend on the environment, on seniors, on health care, on pensions and on many things that Canadians value.

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10:35 a.m.

Bloc

Guy Côté Portneuf, QC

Mr. Speaker, the Liberal member had really nice words for senior citizens and young children.

Unfortunately, they are just that, words. Actually, in this budget plan, the increases in the guaranteed income supplement benefits will only start next year. The first increase will be just $16 a month for an individual living alone. In 2007, the increase will be just $36 a month. I am sorry, but that is not enough to buy a single book in a bookstore. The hon. member should not lecture us about the benefits the government has granted to seniors. It is just window-dressing.

If there is one province where the early learning and child care system is working well, it is Quebec. Once again this is clearly a provincial and Quebec jurisdiction, but the federal government is intruding once more.

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10:35 a.m.

Liberal

Marlene Catterall Ottawa West—Nepean, ON

Mr. Speaker, I will simply repeat that this is the first time since 1984 a government of any political party has raised basic benefits for senior citizens. If the hon. member thinks $700 a year does not make a difference for an elderly couple, he is badly mistaken.

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10:35 a.m.

Bloc

Pauline Picard Drummond, QC

Mr. Speaker, the federal budget tabled on February 23 is unacceptable, because it ignores the priorities of Quebeckers. For the past 12 years, this Liberal government, no matter who was at the helm, has not taken any concrete measures to fix the problems with EI, adequate funding for health and higher education, financial aid for students, agriculture, old age security and the guaranteed income supplement, culture, foreign aid, to mention just a few.

Once again, there is nothing in the February budget to fix these problems. So it comes as no surprise that, having voted against the budget, I will also be voting against Bill C-43, an act to implement certain provisions of the budget tabled inParliament on February 23, 2005, which is now before the House.

The Bloc Québécois has always acted responsibly. We worked to make changes to the throne speech and, immediately after the budget was tabled, we presented the government with a series of amendments. This Liberal government has rejected these improvements, particularly for EI and correcting the fiscal imbalance.

With regard to EI, I have met with women's groups in my riding and they have confirmed the discrimination they are facing because the Liberal government has imposed overly restrictive rules denying them access to EI benefits. We cannot say it enough: the EI fund belongs to the employers and workers, not the government.

In light of this minority government, the Bloc Québécois has taken an important step in its fight to improve EI by putting it back in the hands of its real owners: the workers and employers who contribute to it. I want to thank my colleague from Chambly, who has done an excellent job as the EI critic. After much diligence and hard work, the adoption at second reading of Bill C-280, introduced by the Bloc, has put us one step closer to our goal of preventing the federal government from raiding the EI fund at will in order to satisfy its obsession with paying down the debt.

I also meet youth for whom access to the workplace is not always easy. They are often faced with precarious jobs with irregular hours. Even though they work hard, they are often among the first to be laid off and, as they have not accumulated enough hours, they are not entitled to employment insurance benefits. Why is this government so stubborn that it refuses to lower EI eligibility requirements to 360 hours?

Young people are not the only ones suffering from the decisions of this federal government. Workers who are close to retirement are losing their jobs. In the riding of Drummond, the situation in recent years is quite revealing. I will just mention the sometimes brutal closing of textile plants. Many people who have spent almost their entire working lives in these jobs find themselves with nothing when plants are closed because of an administrative decision.

Let us not forget that this is the government that put an end to the program for older worker adjustment, the POWA. The current human resources minister, the hon. member for Westmount—Ville-Marie, will certainly respond that pilot projects are underway. I will simply remind her that, while pilot projects are going on and on, many men and women are going through tough times because of the Liberals' decision. Recently, an organization from our region, Les 45 ans pour l'emploi, wrote to me to ask for the reinstatement of the POWA. The same request has been made to me every time a business has had to lay off workers.

My reply has always been the same, that the request was on the table but the Liberal government continued to turn a deaf ear to their needs, in its arrogance toward the needs of older unemployed workers.

As for agriculture, a large part of my riding is agricultural, with field crops and beef and dairy operations, for example.

Agriculture is in crisis, and has been for a long time. The past 24 months may have been marked by the mad cow crisis, but field crop producers have also been suffering.

I believe the government has a duty to assist agricultural producers who are having to cope with the mad cow crisis, particularly with compensation to achieve a floor price. But instead, its actions are timid and inadequate, so much so that the farmers have recently decided on a $7 billion class action.

As for the field crop producers, I have met with them in my riding office. Despite the representations they made last years, they have received nothing tangible to counteract the trade injury they are experiencing. They continue to suffer from the federal government's withdrawal from their sector.

At their meeting with me, the farmers of my region again told me of the very difficult, even unbearable, situation being experienced by Quebec and Canadian grain producers. Why? Because prices remain terribly low and do not even cover their production costs, which just keep on increasing. Then there are the concrete interventions by the American and European governments, which have been subsidizing their agricultural sectors for a number of years.

What is Canada's reaction? Over the past 10 years of Liberal reign, while the present Prime Minister was the Minister of Finance, Canada chose the path of withdrawal from the agricultural sector, including the grain producers. Would anyone be surprised to learn that support to the agri-food sector went from 3.9% of the federal budget in 1991-92 to 1.6% in 2001-02, at the same time as Quebec grain producers were recording negative net incomes? When they came to Ottawa they hit a dead end with a Minister of Agriculture and Agri-Food who did not want to listen.

I also hear regularly from the young people of Drummond about their environmental concerns. I will take this opportunity to thank and congratulate my colleague from Rosemont—La Petite-Patrie for the excellent work he does on the environment.

The quality of our environment concerns each and everyone of us. Indeed, we must strive to improve things and every action is important. The recent announcement by the environment minister concerning the voluntary approach accepted by the automobile industry will not result in the attainment of objectives in the area of greenhouse gas emissions reductions. Who, in the final analysis, will foot the bill? It will be the taxpayers who will have to pay instead of the large polluters, because this government has opted for the polluter-paid rather than the polluter-pay principle. As to the implementation plan for the Kyoto protocol presented on Wednesday, it is overly timid.

In terms of social housing, the federal government has totally ignored the repeated requests of the Bloc. Why not use the surpluses of the Canada Mortgage and Housing Corporation, which total $3 billion, in order to build new units of social and community housing?

Needs are great: such is the opinion of the representatives of the aid network Le tremplin, of the Fédération des coopératives d'habitation and the Office municipal d'habitation de Drummondville. On December 31, 2004, in Drummondville, the eligibility list consisted of some 172 applicants, the great majority of whom were receiving employment insurance or old age security benefits.

It is hard to find adequate housing with an annual income ranging from $9,000 to $13,000. The government must make a commitment to devote 1% of program spending to the development of housing.

Much more needs to be said, but I will conclude by saying a few words on the treatment given to our seniors. Any improvement of their financial situation is a good thing. However, part 23 of the bill does not in any way correct the injustice done by the Liberals to the most vulnerable members of our society when they unfairly deprived them of their guaranteed income supplement. The government is still refusing to give seniors full retroactivity, setting the limit at 11 months.

The members of the Bloc Quebecois are committed to continuing to pressure the government until seniors in Quebec and Canada get all the benefits to which they are entitled.

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10:50 a.m.

Markham—Unionville
Ontario

Liberal

John McCallum Minister of National Revenue

Mr. Speaker, it is a great pleasure to speak in favour of this excellent budget.

I believe this truly is an excellent budget. It is a fine example of promises made and promises kept. During the election campaign, the government made promises with respect to the environment, national defence, child care and various other things. In the budget, we kept those promises, we did what we promised to do.

I thought it might be useful in my 10 minutes to focus less on the excellent expenditures of the budget and more on the way in which these expenditures were financed. In my role as chair of the expenditure review committee, we were charged to find $12 billion over five years to help finance the commitments of the government. While we had a number of years in which to find the $12 billion, in the end, over the space of some six to eight months, we found $11 billion, so there is now $1 billion left to go.

I would say there are two reasons why this was an important initiative. First, we needed the money. We had made the commitments in our electoral platform, had costed those commitments and found that we were $12 billion short in terms of the fiscal framework. The Prime Minister and the government made the commitment that we would pay for all these commitments but that $12 billion over five years would be financed through reallocation. In order to deliver on the commitments, we needed to find that money and we succeeded in doing so.

I might point out that $11 billion is a lot of money. Eleven billion dollars is equal to 40% of the total new departmental initiatives in the budget, which are all the initiatives other than the transfers to provinces or individuals. It was important in terms of delivering on the commitments of the government to find this money.

The second reason I think is more fundamental. The second reason involves the sound stewardship of taxpayer money and it involves what one might call a second cultural shift in the way in which Ottawa does business.

I would remind hon. members that 10 years ago this country was mired in a $42 billion deficit and the Wall Street Journal was saying that Canada was approaching third world status. At that time, under the leadership of the Prime Minister and the previous prime minister, tough decisions were made to turn that deficit into a surplus. I think at the time, 10 years ago, few believed that the government would turn that deficit into surplus. Little did they know that not only have we now become the only G-7 country to balance the budget but we have done it for seven years in a row.

These decisions were extremely difficult. All Canadians paid to get from a deficit into a surplus. The point I am making is that this was a true cultural shift. Whereas in 1993 few believed that we could get into surplus, today it is difficult to find anybody in Ottawa who thinks we should go back into deficit. The ultimate proof of that is that even the NDP professes today to believe in balanced budgets. If that has sunk into the NDP, it surely is a general proposition accepted by all. I do not necessarily believe that but the culture of surpluses is so strong that the NDP at least is obliged to pretend that it believes in surpluses.

The second cultural shift is that our Prime Minister said that being in the black was essential but that it was not enough. We have to go to that second level where it will become a culture of Ottawa to not only balance the books but to ensure that every taxpayer dollar is well spent. That implies a culture of reallocation so that each and every year the government examines all of its expenditures with a view to reducing those items that are inefficient, or that have become low priority, and to shift those resources into the high priorities of that day.

That is precisely what was the spirit and the philosophy behind expenditure review. We found $11 billion in lower priority expenditure areas, areas in which we could reduce expenditures to reduce inefficiency.

We had all of that money to deliver in the budget, whether it was for the environment, for national defence, for child care, or for the new deal for cities. It is an excellent example of the first phase of the second cultural shift in Ottawa where we move to a philosophy of reallocation each and every year as stewards of taxpayers' money. There is proof that we are serious in this regard.

Many people have asked me why in the world we would carry out this reallocation exercise when we have such a big surplus. They said that they thought that this kind of thing was only done in a fiscal crisis, such as when we inherited the Conservative deficit in 1993. No, we are not doing this because there is a fiscal crisis. Thanks to the fantastic work of our Prime Minister in getting rid of the deficit, we have no fiscal crisis at all. We are one of the few countries that has balanced its books. There is no fiscal crisis in the land.

The objective of the exercise is not to deal with a fiscal crisis. The objective is to deliver good government and good stewardship of taxpayers' money to the people of Canada. That is why the government found $11 billion in relatively low priority areas and shifted that money to areas that Canadians really care about, such as the environment, child care, health care and national defence. We were able to reduce spending in areas that were less essential and deliver the money to areas where Canadians wanted it put.

We are on the way to a second cultural shift in this country. The first cultural shift was the brave and courageous actions taken by the Prime Minister when he was finance minister to eliminate the deficit and move to a culture of surpluses. This is a culture that is so embedded that even the NDP accepts it, at least on paper.

We have moved from that first cultural shift to the second cultural shift. Each and every year the government, on behalf of taxpayers, will seek to spend more wisely. It will find areas which could be dealt with more efficiently and break down the silos which occur in any large organization. In that way funds will be available to be put precisely where Canadians want them to be spent.

While the finance minister's job was to deliver the funds, my job was to collect part of the funds necessary for this exercise. It was a very positive exercise because we needed the money, and also because we demonstrated to Canadians our sound stewardship of their money. Having moved from the Prime Minister's successful efforts to eliminate the deficit, we have now moved to the second stage where each and every dollar will be reallocated and wisely spent.