House of Commons photoWon his last election, in 1993, with 42% of the vote.
Canada Pension Plan November 25th, 1996
Mr. Speaker, higher job killing premiums are the cornerstone of the Liberal reform of the Canada pension plan. Lower job creating premiums for employment insurance are overdue and demanded by nearly everyone except the Minister of Finance.
Will the minister do the right thing for future generations and today's workers and commit himself to a package of simultaneously higher CPP and lower EI premiums, a package which does not increase job destroying payroll taxes?
Canada Pension Plan November 25th, 1996
Mr. Speaker, the Canada pension plan is in trouble because it is not backed by investment but only by taxes on future generations. Today's young face a very bleak prospect. When they have families of their own, three of them will have to pay the taxes to take care of one pensioner, half of the six doing so now. Only the full private investment of CPP premiums can prevent such an unfair burden.
When will the Minister of Finance do the right thing, stop the unfair burden on future generations and make the CPP a fully funded system?
Taxation November 21st, 1996
Mr. Speaker, different information is coming from the retailers of Canada to us and to the minister.
The tax-in pricing policy was recommended by the Reform Party in its minority report on GST reform, but only in the context of a nationwide introduction of a federal sales tax. Reform, as well as national retailers, oppose tax in-pricing when it is applied only in Atlantic Canada because it costs too much and has already caused the closing of some retail outlets.
Will the minister stop trying to download on consumers in Atlantic Canada the costs of his party's indefensible, irresponsible and politically opportunistic election promise to eliminate the GST? Do the right thing and scrap the federal sales tax for Atlantic Canada.
Taxation November 21st, 1996
Mr. Speaker, a study shows that the inclusion of the new federal sales tax in all prices will cost millions of dollars. Computer systems have to be changed and there are the large annual costs of advertising,
ticketing, warehousing and distribution. All these costs will be passed on to already overtaxed consumers.
Will the minister stop this new burden on consumers in Atlantic Canada by withdrawing the required tax in pricing until the federal sales tax is implemented nationwide? It is a request made by Canadian retailers and strongly supported by the Reform Party.
Speech From The Throne November 1st, 1996
Mr. Speaker, last Friday I spent two hours with a group of highly concerned citizens who met at the McGill faculty club. They were discussing possible steps that might be taken to create a renaissance in the city of Montreal.
These were people who have spent all their professional and business working lives in Quebec and Montreal. They have seen this wonderful Canadian city go from one of the most prominent, rapidly growing, charming and great cities of North America into a tailspin that makes them extremely sad. They all acknowledge the root cause. What they were trying to do was to say: What can we do to reassure the world to come back to Montreal even though this threat exists?
Unfortunately, I did not have much good advice for them. I talked about my experiences with countries that have pulled themselves up by their bootstraps, such as Singapore, Hong Kong and other of the Asian tigers. They rejected the view that the separatist government, if it comes into power, would model itself after those countries because of its great commitment to social democratic values meddling in the economy. That is not reassuring for any of the potential businesses that might consider moving to Montreal.
The insight I gained is that it is not just the idea there might be separation with all of the uncertainties surrounding it. There is also the added problem that all of the pronouncements we have heard until quite recently from Mr. Bouchard are that we will continue to have huge government spending on all kinds of worthy projects which are preventing the growth of the economy and the restoration of confidence.
I do not know the answers. I would say to my colleague there is no doubt that the threat of separation, plus the prospect of what might happen after separation by a very left wing government, carries the primary responsibility for the sad decline of the city of Montreal from one of the great cities in North America to a city with a sick economy.
Speech From The Throne November 1st, 1996
Mr. Speaker, since February, this session of Parliament has delivered exactly what the throne speech promised in the fields of economics and finance, nothing. Policy is on auto pilot with the Prime Minister regularly issuing reassuring messages that he is in control and that no corrections are needed.
The country's biggest problem, the deficit, has been dealt with by benign neglect. Sure, the numbers have improved but mainly through downloading $6 billion on to the provinces a year earlier. There has also been an economic recovery in the United States which spilled over into Canada through increased demand for exports. As a result, spending on unemployment insurance benefits
has dropped by $5 billion. There is not much credit to the government here.
With tax rates set at very high levels, the export stimulated growth has resulted in higher revenues of $25 billion which exactly matches the reduction in the bottom line of the deficit. The much advertised spending cuts on the outer rim of bureaucracy have been very minor. More are slated to come but not for another year. In other words, the much vaunted deficit reduction has been achieved by taking more money away from Canadians through higher tax revenue.
Canadians who want a smaller government in Ottawa and less bureaucracy wrapping them in red tape even when it is not Christmas, will not be pleased by the reduction of less than $1 billion a year when that total government spending is $150 billion, $50 billion on interest alone.
Now the Prime Minister has announced that there will be no more cuts to government spending. The Ottawa leviathan will stay the same size for at least the next two years, by the end of which we can expect higher tax revenue of about $7 billion a year to have eliminated the deficit.
Hurray, then the Liberals will be free to get back to what they are best at: feeding the Ottawa monster. The Prime Minister already has promised to use the higher tax revenue for more spending at the rate of $7 billion a year. The Deputy Prime Minister is licking her chops as she anticipates and already promises money to some of the unlimited number of good causes that she attracts in whatever portfolio she is in.
Of course, Canadians know the flip side of this kind of policy. They feel it in their pocketbooks. Their family income has dropped by $3,000 a year after taxes, primarily because of increased tax revenue since this government came into power.
Then of course there is the biggest red book promise of jobs, jobs, jobs. How many jobs have been created? Just enough to employ the growth in workers, those coming out of high school and those who have immigrated to Canada. The fact is that nearly 1.5 million Canadians are still looking for work. Many more have indicated they are so discouraged that they have stopped looking and many more millions are working only part time.
Let us look at the government's commitments for the future. Over two years, $7 billion more in revenue for each year will go to the elimination of the deficit. Thereafter, increases in revenue are promised to be used for increased spending. That means if the government gets elected again, the pattern they have been on will produce another $3,000 reduction in family income because that is exactly what happened in the preceding four years. All the revenue increases from these rates of taxation has gone into feeding the monster government here in Ottawa.
It is not very encouraging for the people of Canada. I recommend that they look at an alternative which is laid out clearly in the document called Fresh Start for Reform. Under this program the leviathan will be tamed. We will cut another approximately $10 billion out of government spending, not from transfers to provinces. In fact, we will restore some of these transfers that were cut earlier. It will not come out of transfers to people nor out of transfers to the provinces for social programs.
It will come out of programs that should be cut, ones we hear about in the finance committee and from people to whom we talk. Let me list a few. There is overlap in the delivery of services between the federal and provincial governments. There are huge bureaucracies such as the Department of Fisheries and Oceans, the Department of the Environment, the Department of Industry, the Department of Labour. There is a whole list of departments where the provinces have been saying: "You are making life too tough for us". Business is asking: "Why do we have to fill in the same information that we have just delivered to the provincial governments? Why do we also have to give it to the federal government?"
On my shelf I have the Nielsen task force report. Mr. Speaker, you were here when this was produced. It has gathered dust. It indicates that billions can be saved through the elimination of overlap and duplication. That was 15 years ago. This government has not taken the hint. Not only would it reduce the leviathan, but it would also save money and make it better and easier for business to succeed.
Other expenditure cuts involve special interest group funding. A report was released recently which indicated that Canadians through an objective survey have indicated that multiculturalism is not working. Why do we insist on feeding that monstrous bureaucracy and all those activities? Reform is not against multicultural activities. We are against having them financed by the federal government.
Reform has proposed a large number of other cuts. For example, the elimination of the industrial subsidies that are now being given to business. Last week in the finance committee business representatives said: "Please government, get rid of all of the subsidies to business and lower the taxes". That is exactly what Reform is proposing to do.
What would Reform do with the surplus that would be growing and continue to grow? We would target tax cuts primarily at the reduction of barriers to the efficient operation of labour markets.
Whole books are written about this and why our unemployment rate is so high. New thinking is required in that field.
Reform would deliberately bias the fiscal structure in support of the maintenance, growth and strength of families rather than the current system which deliberately favours the splitting up of families so people can go to work and send their children to child care. People who stay at home, fathers and mothers, deserve that same support. Reform would have broad based cuts that would remove several hundred thousand poor people completely from all tax rolls.
Canadians now have a clear alternative. On the one side, a promise of a government that will keep the size of Ottawa and the bureaucracy where it is right now; use increased tax revenue to eliminate the deficit and then go on its merry old way, spending the increases in tax revenue that comes thereafter. Reform offers an alternative. It offers the elimination of the deficit through growth, some more reduction in the size of government and revenue increases thereafter used to give money back where it came from, the people of Canada.
Government Subsidies November 1st, 1996
Mr. Speaker, like the swallows' returning signals the coming of spring, so Liberal announcements of subsidies signal the coming of an election and a campaign of vote buying.
There is no rational defence of the subsidies to film makers and Bombardier which were announced recently. Canadian business representatives urged the finance committee to end all subsidies to industry. Huge subsidies to the Atlantic provinces were shown to have hurt rather than helped economic development.
All subsidies hurt the innocent competitors of the beneficiary. To add insult to injury, the subsidies are financed with taxes paid by the competitors. Job creation through a subsidy is matched by jobs lost through taxation.
Subsidies at election time are a Liberal tradition that stinks.
Government Policies October 31st, 1996
Mr. Speaker, the Liberals brag about their spending cuts, how the budget is under control, how they have tamed Leviathan. Balderdash.
The $14 billion in spending cuts have hardly scratched the monster. Of this amount, only $4.1 billion or 29 per cent came out of monster government that writes regulations, pays MP pensions and writes cheques for multiculturalism, a mere $1 billion cut per year.
Three-quarters of all cuts came from reduced UI payments of $3.4 billion due entirely to economic recovery and from cuts to social transfers to the provinces worth $6.5 billion.
These figures show clearly the Liberal strategy: Keep big government; let the provinces take the political heat.
Now the Prime Minister promises to fatten Leviathan again with more spending. Remember Canadians: Liberals, like leopards, never change their spots. They will always find ways to spend your money.
Taxation October 23rd, 1996
Mr. Speaker, the Minister of Finance at this week's Liberal Party convention will claim that he has delivered on his red book promise and got rid of the GST. This is a false claim. Rolling the GST and PST into one in a small part of Canada does not meet the expectations raised by Liberals during the last election.
Of course, we have heard the Liberals reply to this criticism: "Read the fine print. We never promised to eliminate". In my experience neither voters nor candidates read the fine print in red books. Not even an experienced politician with a name that reminds us of the police did so. No more proof is needed.
I could raise many shortcomings of the new blended GST-PST. Let me mention just a few.
First there is the added cost for national retailers who have to print a different set of flyers, catalogues and price tags on merchandise for distribution in the Atlantic provinces and who have to change computer programs and cash registers. The Retail Council of Canada estimates this cost for all retailers to be $100 million.
The second criticism of the agreement for the new blended retail tax is that it costs the rest of Canada $1 billion. This payment is basically a bribe which the government was forced to pay because of the embarrassment caused by the red book. The Liberals obviously decided that the political cost of this payment was smaller than that of the broken red book promise, especially after their spin doctors told them to emphasize the fairness of the payment in light of adjustment costs incurred. We will see whether such payments will be made to other provinces in the future. Quebec tried to get equal treatment and failed.
We will also have to see what such equal treatment will do to the deficit. I also worry about the distribution of this adjustment assistance. Will it reach the small retailer who has to adjust his cash register and buy new computer software? How much will it cost to distribute this money to such users?
The third criticism of the deal is that it increases incentives for the underground economy. In the finance committee we heard how evasion of the GST is rampant in a number of industries; in construction, automobile repairs and many other services.
Such tax evasion is more rewarding; the larger is the gain. Since the blended tax is higher than the GST alone there will be more underground activity in untaxed income.
Fourth, the PST was a retail sales tax. In order to prevent the cascading of taxes business buyers did not have to pay the tax. As it turned out, for reasons I do not understand, many firms did pay it anyway to the tune of many millions of dollars. The blended tax falling on consumers only has to be higher in order to make up the money paid by business under the old system.
Fifth, the blended tax will not get rid of the complexity of the basic GST system. As the minister well knows, it is a nightmare. Municipalities, universities, schools and hospitals get special deals. Doctors and other professions enjoy yet another treatment. But most annoying is the special treatment given to food. "No GST on food". What a slogan. What a nightmare in practice.
Five doughnuts are not food; six are. Frozen pizza is a food. Pizza in a restaurant is not. I will not go on with the many examples of costly deviations from a value added tax on all transactions, as recommended by most economists and serving extremely well the people of New Zealand.
The trouble with today's announcement is that this complexity is now even higher. Books are no longer books free of tax. There are good books like the ones bought by libraries and universities and not so good books bought by everyone else. What a sham. What an administrative nightmare, a typical political compromise that serves no one.
Finally, I cannot help note that the minister in his statement claims that the tax will benefit consumers. I have trouble understanding this. I thought that the blended tax was revenue neutral. Are we now to understand that it lowers taxes?
If it does, what will be the effect on the provincial and federal deficits? If it is revenue neutral, how then can it benefit consumers?
In sum, the entire scheme of the blended GST-PST tax in the Atlantic provinces is one gigantic failure. It cannot be justified economically and socially. It can be justified only by someone whose judgment is clouded by the desire to extricate the Liberal Party from the serious political hole of their own making.
Reform Budget Platform October 23rd, 1996
Mr. Speaker, the Minister of Finance often talks nonsense about the Reform budget platform. For him and the media, here are the facts made simple.
Spending cuts of $15 billion plus $24 billion in revenue increases in four years will produce a surplus of $39 billion. This money will be used to eliminate the deficit of $14 billion, provide tax relief of $15 billion, raise spending on medicare and education by $4 billion and pay down the debt by $9 billion.
This spending program uses exactly $39 billion in the revenue surplus. Our fiscal program does not produce deficits. We first balance the budget and then use only money in the bank to finance tax cuts and spending increases. The debt reduction money is our contingency reserve. Simple, eh?