House of Commons Hansard #133 of the 39th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was budget.

Topics

Question No. 182
Questions on the Order Paper
Routine Proceedings

3:20 p.m.

NDP

Irene Mathyssen London—Fanshawe, ON

What Human Resources and Social Development Canada funds, grants, loans and loan guarantees has the government issued in the constituency of London—Fanshawe since February 6, 2006, including the 2006-2007 Budget and up to today, and, in each case where applicable: (a) the department or agency responsible; (b) the program under which the payment was made; (c) the names of the recipients, if they were groups or organizations; (d) the monetary value of the payment made; and (e) the percentage of program funding covered by the payment received?

Question No. 182
Questions on the Order Paper
Routine Proceedings

3:20 p.m.

Medicine Hat
Alberta

Conservative

Monte Solberg Minister of Human Resources and Social Development

Mr. Speaker, government information on funds, grants, loans and loan guarantees issued by departments and agencies is based on parliamentary authorities for departmental or agency programs and activities. This information is listed by department and government organization in the public accounts and disclosed on the web sites of government organizations. However, government organizations do not compile or analyze expenditure information by electoral district. Consequently, at present, it would not be possible to provide the information in the form requested.

Over the course of the 39th Parliament, a number of government organizations have undertaken efforts to identify federal expenditures by postal codes which could then be summarized by electoral districts using a tool developed by Statistics Canada. While there is some promise in this approach, there remains a significant potential for error since over 5,000 postal codes straddle two or more electoral districts. Moreover, the government would have significant concerns about the quality of the financial data derived by this approach because there is no way to track the geographic area in which federal funding is actually spent. For example, federal funding could be provided to the head office of a firm situated in one electoral district, while the funding was actually spent by a subsidiary located in another electoral district. This may also be the case for payments to individuals, organizations or foundations. For these reasons, and the fact that fewer than half of government organizations have acquired the Statistics Canada tool, it is not possible to produce an accurate and comprehensive answer to this question at the present time.

That said, Statistics Canada has initiated a process to enhance the accuracy of the tool that provides the link between postal codes and electoral districts. The process will allow departments to better approximate by electoral district data gathered on a postal code basis. The improved tool should be available in the fall of 2007. In the interim, the Privy Council Office will also launch an interdepartmental process to determine whether this tool can be extended to all government organizations as well as the means to ensure that it is used in a consistent manner across the whole of government.

Questions on the Order Paper
Routine Proceedings

3:20 p.m.

Conservative

Tom Lukiwski Regina—Lumsden—Lake Centre, SK

Mr. Speaker, I ask that all remaining questions be allowed to stand.

Questions on the Order Paper
Routine Proceedings

3:20 p.m.

Liberal

The Speaker Peter Milliken

Is that agreed?

Questions on the Order Paper
Routine Proceedings

3:20 p.m.

Some hon. members

Agreed.

National Defence
Request for Emergency Debate
Routine Proceedings

April 16th, 2007 / 3:20 p.m.

Liberal

The Speaker Peter Milliken

The Chair has received an application for an emergency debate from the hon. member for New Westminster—Coquitlam. I now call upon her to make her representations on this matter.

National Defence
Request for Emergency Debate
Routine Proceedings

3:20 p.m.

NDP

Dawn Black New Westminster—Coquitlam, BC

Mr. Speaker, I am asking for this emergency debate so that the House can discuss comments that were made by the Minister of National Defence yesterday. The comments effectively announced a new defence policy for the Government of Canada that would result in larger expenditures of public funds and basically a change in Canadian foreign policy.

I believe that the announcement made by the Minister of National Defence that Canada should expect to be involved in heavy combat with armour for the next 10 to 15 years in different parts of the world is actually momentous, historically significant and without precedent. The minister was talking about an undertaking three times longer than the great war or than World War II. This is something which clearly falls within the administrative responsibilities of government.

I cannot foresee, nor has the government proposed, a time for this issue to be debated in any other way. I felt it was my duty to raise this as quickly as possible with you, Mr. Speaker. I believe that Parliament should speak to this issue which affects the lives of tens of thousands of members of the Canadian Forces. Parliament must have a debate on this issue before the government makes commitments to conflicts over the next 15 years.

For Parliament not to debate this issue today would send the signal to the executive branch of government that it can pursue whatever policies it wishes and that Parliament is unconcerned with its plans or with its expenditures in the conduct of war.

I therefore believe that this matter meets the test of Standing Order 52(6).

Speaker's Ruling
Request for Emergency Debate
Routine Proceedings

3:25 p.m.

Liberal

The Speaker Peter Milliken

The Chair appreciates the interest the hon. member for New Westminster—Coquitlam has shown in bringing this matter to the attention of the House today, but having reviewed the letter that she forwarded to me, the notice that she is required to give pursuant to the Standing Order, together with a copy of the interview, and having heard her remarks today, I must say that I am not satisfied that this request for an emergency debate meets the exigencies of the Standing Orders at this time. Accordingly, I am going to decline her request today.

The House resumed consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the second time and referred to a committee, and of the motion that this question be now put.

Budget Implementation Act, 2007
Government Orders

3:25 p.m.

Liberal

The Speaker Peter Milliken

When the matter was last before the House the hon. member for Yukon had the floor for questions and comments arising out of his remarks. I therefore call for questions or comments. The hon. member for Mississauga South.

Budget Implementation Act, 2007
Government Orders

3:25 p.m.

Liberal

Paul Szabo Mississauga South, ON

Mr. Speaker, I want to thank the member for his intervention in the debate on the budget implementation bill, Bill C-52. He is a member from the Yukon and travels a great deal to participate in this place. In fact, he is here as often as anyone doing his job. His constituents should be very pleased with that.

He spoke very eloquently about the impact of the budget on his constituency, about the impact on the needs for aboriginals and maybe the lack of support for the needs of the aboriginal community. His speech was so full of insight that I want the member to elaborate on the consequences of not having the kind of funding that would have been prescribed under the Kelowna accord but which the Conservative government has totally rejected and voted against. What would it mean to our first nations, Inuit and Métis to have the kind of supports that were proposed in the Kelowna accord represented in the budget?

Budget Implementation Act, 2007
Government Orders

3:25 p.m.

Liberal

Larry Bagnell Yukon, YT

Mr. Speaker, before I answer the question, I want to mention two things I am in support of, but which I forgot to mention. One is the $300 million for cervical cancer immunization. That is excellent. The other is the registered disability savings plan. At least it gets disabled people on the agenda again.

With regard to the member's question, as I said in my speech, just over $400 million was added to the regular budget of $9 billion or $10 billion a year for aboriginal people, which is a totally insignificant amount in a very few areas and would not address the major issues. Fortunately we had the recent experience that the major issues were identified by the aboriginal people themselves in the historic Kelowna agreement. All the premiers, aboriginal leaders from across the country and the federal government got together to make this historic accord with the bottom up itemization of those issues. Instead of $400 million there was $5 billion that would have dealt with those issues, such as housing, economic opportunities, education and health care.

This morning the teachers' association visited me and talked about how aboriginal people in Nunavut actually sleep in shifts because there are so many people living in a house. How can people survive in school when they have to sleep in shifts in the bedroom because there are so many people living in a house?

There is an obvious need for economic opportunities in rural areas where aboriginal people are found. Compared with the rest of Canadians, the statistics in all these areas for aboriginal people are much lower. Canadians are generous people. They want to narrow the gap in educational achievements so aboriginal people can achieve more. In certain cases, special assistance is needed in the classroom and in health care. Why do more aboriginal mothers and babies die in childbirth than the average Canadian? These are critical issues. I imagine there are very few Canadians who would not want to reduce that disparity. The $5 billion in the Kelowna accord would have done that. Instead, we did not even get enough money in this budget to deal with inflation and the large increases in aboriginal people and other types of problems.

Budget Implementation Act, 2007
Government Orders

3:30 p.m.

Liberal

Paul Szabo Mississauga South, ON

Mr. Speaker, one of the broken promises of the government is that it has failed to deliver on the health care wait times guarantee. There were five priority areas. As we know now, the government is working out deals with each province individually saying that if a province satisfies the wait times criteria in any one of the five areas, it will get the money. That makes it interesting considering the health difficulties and the challenges faced by aboriginal people in Canada.

What exactly does that mean in terms of providing the same kind of benefit to the Canadians in Yukon and the other territories? What negotiations are taking place? Where is the money going to go? Is Yukon going to get any money under the so-called broken promise of wait times guarantees?

Budget Implementation Act, 2007
Government Orders

3:30 p.m.

Liberal

Larry Bagnell Yukon, YT

Mr. Speaker, that is a very interesting question because the government has, to its credit, seen that the issue is different in the north. The fact is that a lot of those surgeries do not occur in the north. In a lot of cases, people have to go south for them. The access is to primary health care, actually getting in at the primary stage, because of the long distances people have to travel. We have half of the area of Canada and only three full scale hospitals. People sometimes have to travel hundreds of miles. Primary health care access is a huge issue.

The government's energies in this area are going to be concentrated on reducing the wait times for that primary access and making sure that primary access occurs for all people in the north. That is good and I will certainly be watching to make sure that is implemented.

Budget Implementation Act, 2007
Government Orders

3:30 p.m.

Bloc

Pierre Paquette Joliette, QC

Mr. Speaker, it is my pleasure to rise in debate on the budget implementation bill, Bill C-52. As you know, from the moment the Minister of Finance delivered his budget speech, the Bloc Québécois has supported this budget, even though it is not perfect. This has to be made very clear. It does, however, have enough good stuff in it for us to be comfortable voting for it and, consequently, voting for Bill C-52.

Obviously, in the budget implementation bill, not all budget items are implemented. But the bill does contain items such as measures concerning corporate and personal income tax, fiscal arrangements with the provinces, particularly with respect to equalization, the Canada social transfer, and the Canada health transfer. This budget implementation bill also deals with trusts and new funds, the amount of such trusts, and direct payments to the provinces, territories and other entities. It also provides the legislative framework for using money saved in debt service from paying down the debt to lower taxes, and it contains a number of other measures I do not intend to get into in any great detail, except perhaps for one, and I will start with that one.

As I was saying, this bill has many items, some more interesting than others. I will primarily focus on the measures affecting fiscal arrangements with provinces and environmental issues.

Moreover, I want to start by bringing up an extremely sensitive point concerning income trusts. Obviously, the Bloc Québécois has supported the principle of preventing corporations from converting into income trusts as of the Minister of Finance's announcement on October 31, for a number of reasons based on various factors. Tax leakage was obviously brought up. While the committee was working on this issue, I realized that there were some revenue losses because of income trusts, but the department was unable to pinpoint to what extent. We were given an absolutely unbelievable figure, which included tax deferrals, since some shares in trusts are in registered retirement savings plans. This represented at least half of the figure presented, and, though I will not go as far as to call it dishonest, I think this method was completely biased.

There was tax leakage for the federal government and the Government of Quebec, but certainly not to the extent that the minister was talking about. Moreover, Minister Audet, who, up until the last election, was the Quebec finance minister—we will soon know who will replace him since, as you probably know, he decided not to run again—told me that the Government of Quebec was currently losing approximately $40 million a year because of income trusts. This is rather far from the figure provided by the Minister of Finance, which was in the billions of dollars over the next few years.

I believe that the government decided to put the brakes on income trust conversions primarily because they would have put pressure on a number of businesses. Take BCE, which did not necessarily want to convert to an income trust but was under pressure because a competitor, Telus, had announced that it intended to do so. It was therefore conceivable that in the future, some immature sectors needing investment would convert to income trusts, thereby causing problems for all of Canada and Quebec. I find this argument more convincing than the tax evasion argument.

Moreover, as I said, on October 31 we were in favour of no longer allowing corporations to convert to income trusts. However, that did not address the problem of existing income trusts. We would have been comfortable with changes to existing trusts that had taken advantage of the established rules for years. The Prime Minister's announcement during the election campaign that the rules were set in stone was irresponsible. It is clear that he promised not to change the rules for income trusts. He broke his promise, but as I said, it was an irresponsible promise anyway. I explained why a few minutes ago.

Nonetheless, the people who invested in existing income trusts did so in good faith, thinking they could trust the Prime Minister, who, as I said, promised not to touch income trusts.

We studied ways to minimize the impact on existing trusts. We would have been comfortable with keeping the 250 or so existing trusts and preventing more from being created. We could have agreed to that.

The government, however, decided to force them to convert back to corporations within four years or to pay the equivalent of the taxes paid by people who invest in regular stocks—which is not entirely true, as the committee found during its work.

As I said, the government decided to allow just four years for the transition. We think the government could easily have extended that period to eight or ten years to mitigate the impact of the October 31 announcement.

As I mentioned earlier, we are going to support the budget. However, when election time comes, the government, that is the Conservative Party, will have to explain to us why it did not heed the recommendations of the Standing Committee on Finance. The Liberals, like the Bloc Québécois, gave suggestions for minimizing the negative impact on the 2.5 million Canadians, including Quebeckers, who invested in good faith in these income trusts and who have since been swindled, despite the Prime Minister's promise during the election campaign.

These 2.5 million Canadians, including many Quebeckers, are not all millionaires or wealthy people. Many of them are even retired individuals who are now having a hard time making ends meet, because they have had a good portion of their income cut off. I understand why they are angry. The Standing Committee on Finance, the Bloc Québécois and the Liberal Party have made suggestions to the Minister of Finance. He did not consider those suggestions. Thus, it is up to the Conservatives, the Prime Minister and the Minister of Finance to explain, in an election campaign, why they did not consider the suggestions made to them, for example, by the Bloc Québécois.

That said, as I mentioned, we agreed with the approach in principle. We believe that the Conservative government, the Minister of Finance and the Prime Minister failed to show compassion for hundreds, if not hundreds of thousands of people who invested in good faith in income trusts.

I therefore wanted to send out this caveat—or update—because, clearly, many people who followed the work of the Standing Committee on Finance concerning income trusts are having a hard time understanding that, even though we disagree with how this measure is being implemented, we are nevertheless going to vote in favour of the budget.

We are going to support the budget because—as I have said many times—it represents a significant, yet largely insufficient, step towards correcting the fiscal imbalance. We are talking about money that Quebec desperately needs.

As we all know, the Prime Minister promised on December 19, 2005, to correct the fiscal imbalance. Thus, the Bloc Québécois supported the previous budget primarily, although not exclusively, because it promised to correct the fiscal imbalance in this budget.

The Bloc Québécois looked at what an appropriate solution would mean for Quebec and made a certain number of conditions. They may not have been met in their entirety but some have been partly met by this budget. In any event, the conditions have been met to the extent that the Bloc Québécois feels it can support Bill C-52 at this stage. However, this is not an indication of what will happen in future, especially when the next budget is tabled. If no other significant steps are taken towards the definitive resolution of the fiscal imbalance, we reserve judgment on future budgets.

I would like to say one thing. What was extremely important to the Bloc Québécois was that there first be an increase in transfers to Quebec and a change in the equalization formula to take some of Quebec's claims into account. When the amounts were announced, the financial imbalance caused by the Liberal government, the former Prime Minister and the former Minister of Finance in 1994-95 and 1995-96—when draconian cuts were made to provincial transfers to deal with the deficit—had to be corrected. At that time, the problem was simply dumped on the provinces.

What is very serious is that, beginning in 1997-98, large surpluses were routinely recorded and the situation was not resolved. The imbalance has yet to be corrected.

We calculated that $3.9 billion was needed to correct the fiscal imbalance. Because we are realistic, understanding and moderate in our approach, we proposed that this amount be disbursed over three years. Therefore, in this year's budget, there is the equivalent of an additional $1.7 million in equalization payments, the Canada social transfer and the Canada health transfer.

Unfortunately, I must subtract $270 million from this amount because the Conservative government unilaterally tore up the child care agreements it had with the provinces. Therefore, this year there is an additional $1.723 billion for Quebec, which is not bad in view of the fact that two years ago the Government of Quebec had to sell $800 million of its own assets in order to balance its budget. This money was needed.

For the next year, according to the 2007-08 budget, the government is already announcing an additional increase of $888 million and of $330 million for 2008-09. I know that this is very far from now, but this wish has been expressed and put down on paper. This comes to a total of $2.9 billion, or almost $3 billion. Adding a number of other things, we reach $3.3 billion, which is not far from the financial target of $3.9 billion that we had established.

This is a financial adjustment. The former Liberal prime minister said that the provinces were under financial pressure and this would have to be corrected at some point. That had never been done systematically. Some money was put into health and some into infrastructure programs, but, as a whole, the government had no approach and was unable to put a figure on the adjustment that had to be made to reach a fiscal balance.

However, the current Prime Minister promised us to redress the fiscal imbalance, not the financial imbalance. Now, all he has done is partially redressing the financial imbalance. As I was mentioning, the increases that would be necessary to correct the situation that was created in the middle of the 1990s were estimated at $3.9 billion in the third year, and he is at $3.3 billion. Let us say that, in the next few years, we force him to put in a little more, if we are all still here, of course. As we know, this Conservative government is in a minority position, and I hope it will keep that in mind.

So, we are currently at $3.3 billion. A little extra effort will be necessary to get closer to $4 billion. Still, that does not correct the fiscal imbalance because, as indicated by the word fiscal, this is a fiscal matter, something having to do with the level of fiscal autonomy that can be achieved by the provinces and Quebec. This means that the tax base will have to be renegotiated. But there is no indication in Bill C-52, or in the budget for that matter, that the federal government is prepared to open negotiations with the provinces to transfer the part of the tax base corresponding to the transfers for health, education and social programs. It makes absolutely no sense for Quebeckers to send money to Ottawa and then be forced to grovel on their knees to try and get their tax money back for programs that fall under the jurisdiction of the provinces, Quebec in this instance. We are talking about health, post-secondary education and social solidarity.

It is another ball game where equalization is concerned, because equalization is entrenched in the Canadian Constitution. As long as we are a part of Canada, the Constitution should continue to apply to us. Incidentally, I often like to joke about the Bloc Québécois being the only party in this House that really cares about enforcing the Constitution of 1867 and respecting the areas of responsibility of the provinces and the central government, which is much more than a federal government. That is what we will be working on in the coming months. My colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, who will be taking over as our finance critic, will therefore bring pressure to bear so that negotiations are opened with respect to transferring to those provinces that so desire the part of the tax base corresponding to the transfers for health, post-secondary education and social programs. Quebec so desires, and the Séguin commission was very clear in that regard.

As I have already mentioned, equalization will continue to be implemented. This program is not only enshrined in the Constitution, but it is a program that transfers revenues with no strings attached for the Government of Quebec to use as it sees fit, which is not the case with dedicated transfers. This is the first thing that is missing from Bill C-52 that we are working on.

The second thing is federal spending power. The government has not been silent about this, but it talks about it in a roundabout way and it simply pays lip service. The federal government and the Conservative Party are committed to limiting spending power. We do not want to limit it; we want it to be controlled. We are waiting for a very clear bill from the Minister of Finance to explain how he intends to control the federal government's power to spend in the jurisdictions of Quebec and the provinces. How can federal spending power be controlled in Quebec's jurisdictions? There is just one way: by giving the provinces who so desire the unconditional right to opt out with full financial compensation of a program implemented by the federal government in a shared jurisdiction or an exclusive jurisdiction of the provinces; and the province should be compensated.

Unfortunately, that is not exactly where things are headed. I will read a number of paragraphs from the 2007 Budget Plan for budget 2007-08. For example, I will read from page 120. In the objectives stated by the government, by the Minister of Finance, for renewing and strengthening the Canada Social Transfer, they talk about jurisdictions belonging to Quebec and the provinces. Among the concerns are: “The accountability and transparency of the CST—”.

As far as the accountability of the Canada Social Transfer is concerned, what are the Conservatives talking about? The provinces and Quebec are accountable to the federal government when it transfers their money to them.

We are far from the true approach to controlling or even limiting the federal government's spending power. The following sentence is smooth, “—Canadians are not informed of how much federal support is being provided to each of the three priority areas that the CST supports (post-secondary education, social assistance and social services, and support for children)”.

Not only does the Conservative government not have any intention of limiting or controlling the spending power, but it also wants to ensure that federal support—which is essentially the taxes of all Canadians and Quebeckers—will be more visible in the jurisdictions of Quebec and the provinces. It has absolutely no responsibility in this jurisdiction.

However, because of the fiscal imbalance, the federal government has more money than responsibilities. It is looking for responsibilities and is finding them in provincial areas of jurisdiction. So it adds money. Otherwise, what would it do with that money? It could lower taxes and transfer that money in the form of a tax base to the provinces that want it, as I already mentioned. It could also do useful things in its own jurisdiction. For example, what about the RCMP detachments that were closed? The Conservative Party promised to reopen RCMP detachments that had been closed, as was done in the Lanaudière region, where the Saint-Charles-Borromée detachment was closed. What about employment insurance, which falls under federal jurisdiction? It could at least ensure that the program meets the objectives for which it was created.

As we can see, it is a small step that is significant enough for us to be comfortable supporting Bill C-52, but not enough to talk about correcting the fiscal imbalance. I am sure that Quebeckers understand this very well. I am also sure that they will send back a majority of Bloc members to the House after the next election, to truly defend them. They will force the government—Liberal or Conservative—to genuinely correct the fiscal imbalance. The government cannot just go part way, as it is doing now, when it comes to restoring federal government transfers in areas of provincial jurisdiction.