Guy Côté

[The Budget, March 7th, 2005]

Madam Speaker, I will be sharing my time with my colleague from Beauport—Limoilou.

We have before us a government that has presented a budget that is totally unacceptable, to Quebec in particular, since some of its orientations run counter to the consensus that exists in Quebec. There is consensus on a number of issues, and I will try to provide an accurate picture of the situation.

One of these is the consensus in Quebec on equalization payments and fiscal imbalance. In this budget there is no measure to correct fiscal imbalance in any way whatsoever. More serious still, we are dealing with a Minister of Finance who, as recently as last week, was still giving us evidence of his arrogance in a speech to the Quebec City chamber of commerce.

The Minister of Finance said that fiscal imbalance did not exist, because the federal government invests heavily in areas of Quebec jurisdiction. That is precisely where the problem lies. Rather than looking after its own areas of jurisdiction, it is constantly invading those of the provinces and of Quebec, thereby creating fiscal imbalance.

We had evidence of this—and I am going back more or less to 1995 here—when the federal government pulled out of cost-shared programs. So who got left holding the bill? The public. The Government of Quebec provides a number of programs and services to its citizens, and that is totally normal. As soon as one level of government opts out, Quebec has to try to take up the slack. That is more or less what fiscal imbalance is all about.

The Minister of Finance showed a great deal of arrogance in claiming that there was no such thing, and that he preferred to invade provincial areas of jurisdiction. It is outrageous. We have another example of the government's arrogance when its transport minister dares to say that a reasonable unemployed person will find this budget acceptable.

Last week, the Minister of Transport was in Jonquière. He did not meet with any jobless people, understandably. If he was looking for reasonable ones, I am sure he would not have found any. The way this government is managing employment insurance is a total disaster.

This is unfortunate, because we had indications to the effect that this government was getting ready to propose a number of reforms that might have been interesting. We will recall that last December a unanimous report containing eight recommendations was agreed to unanimously by the Standing Committee on Human Resources, Skills Development, Social Development and Status of Persons with Disabilities. Unanimous means of course that the Bloc Québécois voted in favour of these eight recommendations, as did the Conservative Party, the NDP and the Liberal members on this committee.

Three weeks ago, the same committee put forward once again about 20 proposals to improve the employment insurance system in Quebec and in Canada. They were not agreed to unanimously; this time, our Conservative colleagues preferred to vote against them. However, once again, members of the government party voted in favour of these proposals.

Along comes the budget and so much for the committee vote.

Concerning a comprehensive reform of the employment insurance system, the Minister of Transport, second in command in Quebec, clearly told us that the reform is over. What does this mean? It means that we have to forget about an independent fund. The most outrageous thing in all this is that the Minister of Human Resources and Skills Development has recognized this, quite unwillingly, I am sure. She said that an independent actuary will now determine the level of premiums to ensure that it does not exceed a certain amount of what is needed for the system to work.

What she is recognizing essentially is that the level of premiums was much too high. Instead of serving adequately people in need, people who lost their job, who have to wait a minimum of two weeks before receiving an employment insurance cheque, who must live through the black hole, who work in seasonal industries and who suddenly find themselves without any income, they do something else.

They made the decision to divert $46 billion from the EI fund for other uses that are of no benefit to contributors. It is outrageous.

The budget provides $300 billion to help seasonal workers. First, this kind of money is not adequate. Second, this help will apply just in areas where the unemployment rate is over 10%. The minister is proud to tell us that those eligible will get benefits for five more weeks. I would like to clarify this. Unless I am mistaken, it is “up to five more weeks”. It is quite different.

Something particularly outrageous—and it is one of the major problems with this EI plan—is that only 45% of all contributors are eligible for EI benefits, which means that 55% are not.

Just imagine what it would be like if this was an insurance company, and if 55% of the claims of the insured customers were denied. It would be outrageous. But the minister is satisfied with this and she does not do anything to correct the situation. How arrogant. It is just another example of this government's arrogance.

If there is one thing on which all Quebeckers can agree, it is the need for a new Program for Older Worker Adjustment, a new POWA. There is nothing about it in this budget. Instead, the Parliamentary Secretary to the Minister of Finance confirmed in a CPAC broadcast, “No, the old folks are so happy they ought to be dancing in the streets”. In terms of the Guaranteed Income Supplement, it will mean an extra $36, five years from now. There is no reason for older workers to be dancing in the streets. I am ashamed to hear a fellow member of Parliament saying such things.

There is nothing for the self-employed. There is nothing for immigrant workers who are not eligible for benefits. This government's management of employment insurance—and the budget—is simply scandalous.

With regard to agriculture, there is not much. The cull cattle problem which affects Quebec has been overlooked. They talk about $17 million spread across Canada. It is not fresh money; it is money taken from other budgets and rearranged. There is nothing for Quebec's farmers.

There is nothing about Kyoto. It is the same thing. Money is allocated for Kyoto, but there is no mandatory plan for industry. Instead, subsidies to oil companies and the auto industry continue, while there could have been very simple measures in the budget, such as income tax credits for public transit passes. But that is not in the budget.

An effort could have been made toward wind power. Moreover, there is no tax credit for the purchase of hybrid vehicles. And yet, these are relatively simple measures to apply, at least they seem so to me. This aspect has been completely overlooked in the budget.

I think it is not only sad but scandalous. It is not as if this government did not have the means. In fact, all the serious analyses tell us that over the next three years, the government's surpluses will not be $15 million, but $34.6 billion. It has often been said in this House that the Conference Board of Canada—and God knows it is not a den of separatists—estimates the federal government's accumulated surpluses over the next 10 years will amount to $166 billion.

During that time, it is not solving the problems of employment insurance, the fiscal imbalance, equalization, agriculture, nor older people. It is a complete failure; it is lamentable and scandalous.

[Budget Implementation Act, 2004, No. 2, February 25th, 2005]

Mr. Speaker, I hope you will permit me to point out the irony of being here on February 25, 2005, discussing a bill to implement a number of measures in the 2004 budget, which was brought in a year ago. I find it quite ironic.

As my colleague from Joliette mentioned earlier in the day, we will vote in favour of this bill because it contains a certain number of measures which can remedy—to some extent—a number of problems.

This bill lists many things. Unfortunately, what is even more striking is that it also ignores a number of things. On this point, I would like to read an extract from an article which, although the journalist was speaking of Wednesday's budget, could be applied very well to the measures in the 2004 budget and all the budgets presented over the past eight years. He says:

The lack of credibility is much more worrisome. It comes from the fact that the budget is based on figures no one believes anymore. For eight years, federal financial operations have generated large surpluses which budget speeches, year after year, have denied. Last year, as always, the Minister of Finance predicted a surplus of $3 billion. It will be $10 billion, $12 billion, $15 billion or something like that. For this year, the minister is announcing, as always, a $3 billion surplus. We do not believe him.

The gap between the forecasts and the reality is too wide, too predictable, for it to be justified by thrifty management. But especially, this gap is corrupting the very essence of the budget process. What a budget is meant to do, in addition to providing an update on public finances, is to establish the resources available and have a collective debate on their best use. This debate is essential for democracy and impossible if the real size of the surplus is not known.

For example, recognizing the fact that there are large surpluses could lead Canada to begin to seriously reflect on making different choices, reducing income tax substantially, creating a new agreement with the provinces, greatly reducing the debt or, perhaps, engaging in extraordinary initiatives—debates that are impossible if, technically, manoeuvring room is $3 billion.

More importantly, as a result of this budgetary fiction, important decisions are now being made outside the budget process, as surpluses materialize out of thin air. For example, for fiscal year 2004-05 ending in March, Ottawa incurred $10.9 billion in expenditures that were not included in last spring's budget. These are significant expenditures that escaped budgetary debate. And it looks like it will be the same this year. The new initiatives for 2005-06 announced in Wednesday's budget are in fact very modest, at $2.9 billion, probably because the real 2005-06 expenditures will come later, once a surplus has been uncovered.

—The fact that the federal government is so affluent while the provinces are increasingly struggling to carry out their responsibilities is creating an imbalance, both politically and fiscally. Besides the fact that it is unfair and causes misuse of collective resources, Ottawa's refusal to recognize this imbalance is translating into moves that are not always very bold.—

—Because of this dynamic, the finance minister's budget lacks consistency, credibility and legitimacy.—

—As a result, when the Minister of Finance announces an initiative, even an intelligent one, instead of applauding, we tend to think that the money he is spending should not be in his hands to begin with.

There are such initiatives in this bill.

These remarks were made by Alain Dubuc, a reporter with La Presse and Le Soleil , among others.

[Employment Insurance, February 24th, 2005]

—dipped into EI fund surpluses? Why is she not putting the money back?

[Employment Insurance, February 24th, 2005]

Mr. Speaker, the Minister of Human Resources and Skills Development is announcing that, in the future, premiums will not exceed program costs. In other words, she is acknowledging that, in the past, she has dipped liberally into the EI fund surpluses for other purposes. It sounds like she is promising not to do that anymore, but we have our doubts.

Is she admitting that she has—

[Employment Insurance, February 24th, 2005]

Mr. Speaker, let us discuss honesty. The Liberals also voted in favour of the report by the Standing Committee on Human Resources, Skills Development, Social Development and the Status of Persons with Disabilities, which called on the government to repay the billions of dollars it had pillaged from the employment insurance fund.

How can the government justify rushing to reduce the debt in order to repay the major banks, while refusing to reimburse the billions of dollars it has stolen from the unemployed?

[Taxation, February 22nd, 2005]

Mr. Speaker, when the same economic model is re-used, the same errors are repeated. Over the past eight years, the department has been off by $87 billion in its forecasts of the surplus. Come on now.

Does the Minister of Finance intend to open his eyes and use the next budget to settle fiscal imbalance once and for all and to use his enormous surplus to at least meet the urgent needs of the population?

[Taxation, February 22nd, 2005]

Mr. Speaker, last year the Minister of Finance predicted a $1.9 billion surplus, and the final figure was $9.1 billion, that is a margin of error of 450% for the year 2003-04 alone. Experts are predicting a surplus of between $25 billion and $33 billion for the next three years, while the Bloc's forecasted figure for the same period is $29 billion.

Will the Minister of Finance admit that all serious predictions give him the manoeuvring room necessary to solve fiscal imbalance once and for all?

[Supply, February 22nd, 2005]

Madam Speaker, unfortunately I may well be mistaken because, unlike government members, I do not claim to know it all. However, as regards the various foundations, it seems to me that most if not all the funding is provided with public money.

In my opinion, the fact that members of the public or people from various organizations or companies in the private or public sector, sit on the boards of directors should not, in my opinion, prevent the Auditor General from examining the books of these foundations.

Earlier, I referred to the Canada Foundation for Innovation, which is not the one that we are most concerned about. I would like to mention another case that is of concern to me as a parliamentarian and regarding which I would like to get some answers: Sustainable Development Technology Canada—

[Supply, February 22nd, 2005]

Madam Speaker, my Conservative colleague has asked an excellent question. That is one reason why it is so important for the Auditor General to have access to the foundation's figures.

If the government is as transparent as it says it is, if it has the interests of the people of Canada and Quebec at heart as it says it does, if the money involved is managed well by the foundations as it says it is, I do not understand the logic of not allowing the Auditor General to confirm what the government says. It would be quite proper and normal.

As I was saying earlier, there is a basic principle of democracy at stake. This money has been collected by the government but does not directly belong to it; this money belongs to the workers of Canada and Quebec, because it has been taken out of their pockets for the public good.

It would, therefore, be a matter of course for us as parliamentarians to get the correct information. The person who can give it to us is independent of the government and reports to Parliament. This person, in the current system, is the Auditor General.

It is healthy and normal for questions to be raised. I shall briefly suggest a few.

For example, the Canada Foundation for Innovation began receiving funding in 1997. It has received $3.651 billion. After nearly eight years, it has only given grants totalling $1.23 billion. What did the government gain by putting nearly $3.5 billion into it, when nearly eight years later, just over $1 billion has been paid out in grants? Moreover, we see that $39 million of that has been spent on administration.

These are questions that all of us as parliamentarians are entitled to ask, since our constituents ask us the same questions. The person who can provide answers in this situation is the Auditor General.

[Supply, February 22nd, 2005]

Madam Speaker, first, I would like to point out that I will be sharing my time with the hon. member for Jonquière—Alma.

Over the past few years, the Prime Minister transferred $9 billion to the various foundations. Of this, $7.7 billion has yet to be used. It is essential that the Auditor General have access to the accounting data of these various foundations and report on them to this Parliament, which is the trustee of the taxes paid by Canadians and Quebeckers. That is essential.

Through my hon. colleague, the Bloc Québécois introduced Bill C-277, which I supported. Hon. members will understand that we are in favour of this motion. To us, it is the least objectionable solution; of course, our preference would be for the abolition of these foundations, which this government is using as part of its trick to reduce surpluses and hide from parliamentary scrutiny the amounts previously mentioned.

Why do we think that the foundations should be abolished? I will be brief. The foundations are unacceptable for a number of reasons. They are unacceptable because parliamentarians lose control over the mission of the foundations. They are unacceptable because parliamentarians do not know whether these foundations are managed properly in accordance with the various policies of this Parliament. They are also unacceptable because, as I mentioned earlier, they have served too often to hide the budget surpluses of the current government and Chrétien government preceding it.

In addition—and this is an eminently Quebec concern—I think that the role played by foundations is really unacceptable because they have been used too often to trample—and I weigh my words carefully—on the jurisdictions of Quebec and the provinces. For example, there are the Foundation for Innovation, the Millennium Scholarship Foundation, the Health Services Research Foundation, the Canada Health Infoway. If there are areas that are clearly the jurisdiction of the provinces and Quebec, they are health and education. In addition, these foundations are outside the application of the Access to Information Act.

The foundations exist. What do we do? Let us ensure, as parliamentarians, that we know very clearly what is being done with these funds. The very person to exercise this financial control over the foundations is the Auditor General. I want to underscore this because, in a very important opening, the President of Treasury Board acknowledged this morning the importance of Bill C-277, which would give the Auditor General this responsibility. He said that he agreed with referring Bill C-277 to committee for further study.

This is essential because we, as parliamentarians, want to give the Auditor General this mandate so that at least there is some control over the financial operations of the foundations. The Auditor General must have access to the books. I said it before on another occasion. The government regularly states of course that the accounts are audited by experts. That is certainly true, but what do these experts do?

They really audit what I would call the basic accounting of these foundations. In the end, I am quite certain, the external auditors will recommend that the figures are correct according to generally accepted accounting principles. The Auditor General can go much further than that. She can comment on how these funds are managed and whether they are always fully in keeping with the mission of these foundations and the wishes of Parliament.

In her follow-up report of February 15 on the accounting of foundations, the Auditor General made a point that is important for people to know.

On the audit, she mentioned that, overall, progress was unsatisfactory and that the foundations were largely unaccountable. She mentioned that the transfer of funds to these foundations continues to keep public funds—not private but rather public funds—from an effective parliamentary review.

Furthermore, given the importance of the amounts at stake, she was concerned about the lack of proper accounting to Parliament. Ultimately, this is what it comes down to. These amounts were taken from workers and our fellow citizens. And we as parliamentarians are being told that we cannot do a proper examination in order to see how these funds are being spent. This is truly unfortunate.

As I said, we are in agreement. And with Bill C-277, we are going to give the Auditor General the tools she needs to act as auditor or joint auditor for the following organizations: crown corporations; bodies established by acts of Parliament and to which the Government of Canada has paid $1 billion or more over any period of 12 consecutive months; any corporate entity without share capital, to which the Government of Canada paid $1 billion or more, in money or in kind, over any period of 12 consecutive months and in respect of which the Government of Canada has, either directly or through a crown corporation, the right to appoint or nominate a member of the governing body.

The government is doing its best to earn a reputation as an open government, one that promotes transparency and that says, contrary to reality, its estimates are realistic and correct. If the Auditor General is given access to the figures of the various foundations, if she can do her job as guardian of public funds, then she could—we all hope—confirm what the government is saying. However, if this is not the case, she will be able to say so. She will be able to tell all parliamentarians whether the amounts that were—I will not say misappropriated because it is perhaps too strong—but whether the amounts allocated—to put it politely—to the various foundations were spent correctly or not.

It is our job as parliamentarians to be able to reach this conclusion, to have the tools we need to do this and to report back to the public.

Last weekend, I had the pleasure of a meal with my father-in-law, and the first topic of discussion he raised was this: “How is it possible that, with all the money there is in those foundations, you people have not a word to say about it”? I would have loved to defend the foundations, but what could I do as an MP? The only answer I could give was: “Yes, you are right. We have no control over that money. The government does not want us to. It blocks access to the Auditor General, the key instrument.” I added: “Don't worry. We are onto it. I have supported a bill to bring about some concrete control, and we will not give up.”

I am very pleased, as I have already said, with the openness offered to us this morning by the President of the Treasury Board, in order to get the bill referred to committee. It can then be examined in detail and we will be able to get to the bottom of the matter as far as the funding allocated to the various foundations is concerned.

What we are dealing with here is a fundamental principle of democracy: the public must know where and how the taxes the government collects are spent. These taxes are essential to the government's mission, and that is perfectly all right. That mission, however, must be fulfilled properly.

Care needs to be taken to ensure that there are no more incidents like the ones we have witnessed in recent years. I will mention just the one: the sponsorship scandal, that's it. Because of that alone, the Auditor General must ensure that the funds in the foundations are properly spent.