Bill C-2 (Historical)

An Act to amend the Employment Insurance Act and the Employment Insurance (Fishing) Regulations

Employment Insurance

[Jane Stewart, Liberal, Minister of Human Resources Development]

Mr. Speaker, let me say again that the government has continued to take a balanced and prudent approach to managing employment insurance.

I would remind the House that as a result of Bill C-2 we have changed the system to benefit seasonal workers. If the Bloc would have had its way, that bill would never have passed and the 340,000 Quebecers who are now benefiting from those changes, from the elimination of the intensity rule, for example, would not have received their repayments if it had been up to the Bloc.

[Jane Stewart, Liberal, Minister of Human Resources Development]

Mr. Speaker, I say again that changes were made. They can be found in the changes in Bill C-2. They can be found in the decisions that we made to make the small weeks pilot project permanent and in changes to undeclared earnings.

What is also very important to understand is that our members of parliament are working with their communities to find new ways of diversifying their economies because Canadians want jobs.

Softwood Lumber

[Odina Desrochers, Bloc, Lotbinière—L'Érable, QC]

Mr. Speaker, I am very pleased to rise tonight to take part in this emergency debate, which was requested by my party and deals with the economic crisis affecting Quebec and my region because of the softwood lumber issue.

First, I would like to thank my colleague from Joliette for all the efforts he made over the last few months to try to prevent this crisis, as well as my colleague from Laurentides, who travelled to Washington twice to try to resolve this issue.

Personally, I made representations at the Canada-United States parliamentary association, particularly at the annual meeting that was held last May in Blue Rivers, British Columbia, and just recently, on Monday morning, in the presence of a representative from the U.S. congress.

Once again, despite all the diplomatic and political efforts, Quebec and Canada are facing economic turbulence. Once again, Quebec is facing a problem that was created by the U.S. government.

The Americans are increasingly protectionist, and I would even say increasingly selfish. They ignore the free trade agreement and impose economic measures that slow down softwood lumber production considerably.

In recent years, the U.S. government has become the killjoy of bilateral and multilateral agreements by not complying with trade rules.

I would like to address the Americans' attitude as far as agreements in the agricultural area are concerned. The U.S. has not even respected the GATT agreements by maintaining the heavy export subsidies and grants to sustain their domestic trade, which results in a market distortion. Most countries that do business with them are forced to constantly appeal to the WTO tribunals to get their rights respected.

While Canada is battling before the courts to win its case, thousands of jobs are being lost in Quebec.

As the member for Lotbinière—L'Érable, I have risen in the House on numerous occasions in defence of the economic interests of my region. Today, the decisions of the U.S. government on softwood lumber are jeopardizing hundreds of jobs in my riding.

When they were already reeling under the 19% countervailing duties, the U.S. government last week delivered the final blow to companies directly or indirectly connected to softwood lumber, by adding anti-dumping duties of 12.5%.

In our riding of Lotbinière, a number of companies were already severely affected by the U.S. countervailing duties. In Daveluyville, Doucet Machineries has experienced a considerable drop in purchases and orders. Since the countervailing duties have been introduced, the company has been operating on a job-sharing basis.

In Plessisville, countervailing duties have had an impact on the For-Min group, which includes Carbotec and Vibrotec, which is also slowing down production. Forano U.S.N.R is also suffering as a result of the U.S. government's decision.

The Government of Canada must demonstrate much stronger leadership when dealing with the Bush government, which is not at all shy about interfering with all kinds of economic measures to slow our economy. The Prime Minister needs to tell President Bush clearly that he is wrong on the softwood lumber issue.

It is American consumers who are directly affected by their government's attitude. In fact, as we know, our softwood lumber is of better quality, and costs less to produce than the lumber from U.S. mills. American families who want to build a house are being penalized because they are being denied access to our 2x4 lumber.

On behalf of the thousands of employees whose jobs are threatened, I urge the Government of Canada to demand that the Bush government return to free trade for softwood lumber, and that the U.S. respect its signature.

Softwood lumber producers cannot afford to wait for 10, 20 or 40 days. The U.S. government must immediately suspend the countervailing duties that are choking our provincial and regional economies.

The Bush administration knows that it is wrong. I am asking the Minister of International Trade to settle the issue quickly and efficiently, not through negotiations that will drag on interminably. Time is of the essence. Quebec's economy, the Canadian economy, and regional economies are already suffering in the wake of the attacks of September 11. Quebec, and Lotbinière—L'Érable cannot afford to wait. The United States has the power and the responsibility to act immediately. And it must.

The softwood lumber crisis has become cyclical. We need to come up with a permanent solution for this issue.

The Minister for International Trade should not be going it alone here. He should immediately call all stakeholders to a meeting in order to hear what they want and to work out a common strategy with them in order to resolve this issue for once and for all.

In the last few minutes, I have been critical of the U.S. government in this issue. I would now like to address the Minister of Human Resources Development, who seems unaware of the softwood lumber crisis in our regions. She too must do her job.

In fact, the minister has the authority to relax the EI rules by removing the waiting period, and increasing the number of eligible weeks and the amount of benefits. This would show her solidarity with workers affected by the softwood lumber crisis.

Every time a crisis hits the regions of Quebec, the Minister of Human Resources Development drones on about Bill C-2, which made only small improvements to the EI system, which is leaving our regions poorer every year.

Again this afternoon, the auditor general pointed a finger at the current EI system, which is building up a surplus year after year. The minister therefore has the financial leeway to take action now.

A treasury board document shows clearly that, since 1998, the surplus in the EI fund has grown at the rate of $7 billion a year. So, over the past three years, this surplus has grown to $21 billion. Despite this huge amount, the minister is still waiting.

Perhaps we should ask the person who decides everything in her department, the Minister of Finance, why the government is doing nothing.

Again, I call on the Canadian government to find a speedy and permanent solution to the softwood lumber issue. Quebec, the second largest producer of softwood lumber in Canada, with over 25% of Canadian production, must receive massive and tangible support from the Canadian government in order to end what I would describe as these unjust and unfair actions by the U.S. government, which are now paralyzing a vital sector of our economy.

Employment Insurance

[Paul Crête, Bloc, Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC]

Mr. Speaker, a unanimous report by the Standing Committee on Human Resource Development goes further than the few changes proposed in Bill C-2. If the Liberal MPs have passed it, this is because the amendments proposed are really in line with the campaign commitments.

How can the Minister of Human Resource Development ignore the campaign commitments made by her fellow ministers in all regions of Quebec, commitments so firm they convinced even the Liberal MPs?

[Jane Stewart, Liberal, Minister of Human Resources Development]

Mr. Speaker, the government does appreciate it and in fact has been responsive to the concerns of seasonal workers. Indeed, we eliminated the intensity rule in Bill C-2 when we made changes to the clawback provision to make it fairer.

I would remind the hon. member that the fundamental change from a weeks based system to an hours based system has directly benefited seasonal workers by increasing the length of their entitlement. He would be interested to know that their average weekly benefits are about 8% higher than those of other claimants.

Prebudget Consultations

[Paul Crête, Bloc, Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC]

Mr. Speaker, I will be brief.

I would like to know what the hon. member thinks of the response of the Minister of Human Resources Development to the unanimous report on the issue of employment insurance.

We know that in June all members from all parties agreed that major changes had to be made. There were 17 recommendations. In the context of the present prebudget consultations, it is important to know whether members share the minister's position that the solution is to do nothing, to change nothing and to put no additional funding into the system because it is apparently working very well.

Does the member share that position or does she agree with her Liberal colleagues who sat on the committee and who were still in the spirit of last year's election campaign, in which they all committed to making major changes to the employment insurance plan above and beyond the mere elimination of the intensity rule? The unanimous report, entitled “Beyond Bill C-2”, meaning beyond the bill passed by the government to eliminate the intensity rule, contained 17 additional recommendations.

Does the member agree with the minister or does she agree with the members of her own party and of all parties in this House who were calling for a fundamental reform of the employment insurance plan to enable us to deal with the crisis we are now facing because of terrorism, as well as the crisis in the softwood lumber industry and the overall economic downturn?

Would giving the less fortunate in our society the means to spend some money to meet their everyday needs not be a good way of putting money back into the economy?

Prebudget Consultation

[Stockwell Day, Canadian Alliance, Okanagan—Coquihalla, BC]

Mr. Speaker, I am pleased to participate in this take note debate on the upcoming budget. It is our sincere regret that it has taken the government nearly two years, over 650 days, to prepare a full accounting of the nation's finances.

It is unheard of in any free nation today that the government would go almost two years without tabling a budget. There is no premier in Canada or mayor of any city who could get away with such a high degree of unaccountability.

I congratulate the federal Liberal spinmeisters on deflecting media attention away from this glaring record, perhaps the greatest record of the last century in terms of length of time without accountability. This is not a laughing matter. It has been one of the many reasons for the lack of confidence in the Canadian economy.

Two years without a budget is far too long.

The finance minister has totally dismissed our concerns about the economy for months. We talked about the economy slowing down, the out of control spending of the government and how we were heading toward a deficit. The lack of clear information on the government's fiscal priorities was irresponsible and disrespectful toward parliament.

They laughed at us and ignored us. It is inexcusable that it has taken the beginning of a war and the onset of a recession to cause the finance minister and the government to finally table a budget.

It has been interesting to watch so many different areas of government public policy planning over the last seven years. In virtually every area the Liberal ship of state has been adrift at sea without an anchor and compass. When the winds of adversity blow the government panics. It puts up the sails and inevitably runs aground on some rocky reef of poor public policy planning. That is inexcusable.

It has been a decade of being adrift. It is not only in the area of not having a budget or fiscal priorities but also in the area of security where there has been no forward planning. There is only panic as with the anti-terrorism legislation that drifts into areas which perhaps we should not be going into.

We now have the softwood lumber problem that has thrown tens of thousands of people out of work. We warned the government about it for years. Yet it did not react. The panic sets in when those winds of adversity hit. It is inexcusable that nothing is being done and that people are run aground. We will continue to bring it to the attention of Canadians.

On September 11, the world changed and we have to view certain realities from a fresh perspective. It has forced us to review our priorities. We hope that the government will align its priorities with those of the people it is supposed to represent.

There are three critical areas in which the government must realign its priorities: first, the whole question of a deficit of resources for our national security concerns; second, the oncoming Liberal recession; and third, the long term decline in Canada's standard of living. Factual, calibrated and measurable, these must be addressed.

In the area of security, the first and foremost responsibility of any federal government is to defend national sovereignty and to protect the safety and security of its citizens.

That is why the Canadian Alliance, and before it the Reform Party, has consistently called for adequate resources for our police, intelligence and defence services, calls that have gone unheeded. We have done this even though we are a party that believes in smaller and less costly government in almost every other area. However we believe that freedom is not something we can take for granted. Freedom comes at a price and its price is eternal vigilance.

Regrettably, despite the blizzard of rhetoric from the Liberal government, its actions suggest that national security is in fact one of its lowest priorities. We can say all the things we want but we measure people on their actions and the actions of the government suggest national security for its citizens is among one of its lowest priorities.

Over the last few years the government has routinely dismissed our calls for necessary spending to enhance national security and defence. We made those calls long before September 11. It continues to dismiss those calls.

Since 1993 defence spending has been cut by $1.6 billion, a massive 23% reduction in real terms. Any time the Minister of National Defence stands up and talks about a very recent knee-jerk reaction in spending, moving up in a small incremental way, he must account for the fact that the Liberal federal government slashed our national defence by 23%. It was one of the single greatest reductions of any department. The government cut its own preferential spending by only 7%.

I get tired of hearing the Minister of Finance stand up and talk about dealing with the deficit in this country. He neglects to say that he did it by huge cuts in two areas: our national security and our national health care system. That is how he cut the deficit and did only 7% in terms of the government's own wasteful spending. Every time the minister talks about deficit reduction he should be mentioning how he did it and whose backs were affected. That is where the cuts have come.

During this time the reduction in terms of military personnel has declined from 90,000 to 58,000. The Conference of Defence Associations, which is the major scientific and advocacy group related to military needs, resources and spending, has defined in a very recent report that there is a $1.2 billion annual deficit in terms of the needs of our military. That $1.2 billion annual deficit is just for maintenance and ongoing operations and does not even address the ongoing needs of increased national security that we now face.

They are not alone. The auditor general has estimated between now and the year 2012 a $30 billion funding shortfall in defence equipment just in those few years.

The government has given Canada the embarrassing distinction of giving the second smallest defence commitment to NATO. These are the hard facts. Canada's commitment of 1.0% of gross domestic product is less than half of the NATO average of 2.2%. This is not something for which we can be proud. In other words, for Canada to match just the average spending in terms of the commitment that our allies share, it would require us to nearly double our defence budget from $10 billion to $21 billion. There must be an increase even beyond what the defence association says, of $1.2 billion.

I have addressed this subject many times. Our defence critic, the member for Lakeland, and other members of parliament in the Canadian Alliance have also detailed this enormous funding shortfall. We have made it very clear that it is impossible for Canada's military personnel, whom we personally believe are the most dedicated and the most courageous in the world and have proven that in the last century, to adequately meet all the commitments and requirements that are put upon them, which includes continental defence, treaty obligations, UN peacekeeping and now the war on terrorism.

We believe it is wrong to ask our military personnel, whom we believe are the best in the world, to defend this country, its assets and its interests at levels on which they are not able to do so. It is wrong for us to make promises we cannot keep. It is wrong for Canada to leave it to our allies, particularly the United States, to do all the heavy lifting on our behalf.

On September 11 Canada's free ride on national defence came to an end. The time has come for the government to make its lowest priority the nation's highest priority and that is the protection, safety and security of our citizens.

In analyzing what we believe will be the numbers in the budget, we have identified that it will require approximately $2 billion from low priority areas being moved to the Department of National Defence. That is as a down payment on additional future increases to give our military the resources it needs.

Maintaining national security is an increasingly important task of our domestic intelligence and police agencies, such as CSIS and the RCMP. Since 1993, again, the government cutting its own pet projects only by 7%, has reduced the CSIS budget by 28% in real terms at a time when we need more of that intelligence activity than at any other time.

Through the years the Canadian Alliance and our members before us have been telling the government about the concerns worldwide of bandit or rogue individuals or nations and that we would require even more resources in this area, but the government cut CSIS by 28% in real terms. That is a diminishment of our national security.

Given the enormous new demands on that agency it is only reasonable that the funding should be restored at least to the 1993 levels of $272 million. That would entail an increase of $76 million.

The RCMP is also currently in need of more personnel. Customs and immigration also require added resources, not just personnel but for major new technology acquisitions, updated passport scanners and computers, and potentially for advance biometric screening systems. They need all of this and it must be addressed.

It is interesting to hear the government talk about its concern for national sovereignty. The coast guard has seen its fleet cut by 40%.

When the government talks about national security and protecting Canadian sovereignty, it thinks that means we must respond to the minister of culture and stop watching satellite systems that come from other than Liberal approved programs. It believes that is what will keep our national sovereignty in place. Well it will not.

A 40% cut to the coast guard is irresponsible and does put national sovereignty at some risk. It requires new funding to replace aging vessels, to increase the coastal patrols and to acquire satellite tracking systems for incoming ships.

Finally, the Department of Transport will have to assume some of the cost related to airport security. Some of those costs could and should be shared by users but the Department of Transport will have to be there to share some of the costs of increased security measures. Altogether, these and other security related measures are likely to cost in the neighbourhood of a billion dollars annually. I hope the finance minister is jotting these numbers down.

Let me say again that enhancing our national security and working with our American neighbours to create a secure, common perimeter is not an option for Canada. I cannot understand the Prime Minister's paranoia when he says that building a strong continental border and working with the Americans somehow puts our national sovereignty at risk. That is a ridiculous state of paranoia.

The other night millions of Canadians gathered around their Japanese made television sets, wearing their made in China, fleece lined exercise outfits, sitting on furniture made in Sweden, watching an American baseball game played by players from all over the world including Puerto Rico, drinking Coca Cola and munching Mexican tacos. Their sovereignty was not being threatened by those actions and they did not fear their sovereignty was being threatened. However our sovereignty is being threatened when we slash the military and our security forces and say we will not work in common with Americans to develop some strong policies for North America. That is simply irresponsible thinking.

It is a necessity that we work together to increase the levels of security and the levels of safety for all of our citizens. This is all a question of priorities.

My colleague, the member for Calgary Southeast, will outline several billion dollars in wasteful and low priority spending. He, other Canadian Alliance members of parliament and the auditor general have done some good work on this. This year the auditor general pointed out hundreds of millions of dollars of waste, and he called it waste. The auditor general wanted to know who was minding the store. Well the official opposition is going to mind the store because the government does not. We will take on and have been taking on that responsibility.

These areas of wasteful and low priority spending have been identified. We need to reallocate from low priorities of spending and move back to high priorities of spending on safety and security which is what Canadians want. For example, we talked about the $2 billion immediate increase in the defence budget that is required. That is roughly equivalent to what the government spends now on corporate welfare.

The $1 billion that we see in additional security measures is less than the industry minister plans to blow out the door on his Internet scheme.

We expect some intelligent prioritization to go on. When we talk about a billion dollars being blown out the door by an Internet scheme we do not expect a response from him saying that the Alliance does not care about Canadians having computers.

Canadians in the free world are among the highest users of computers and that has been done without the billion dollar plan to get higher speed chat rooms for all Canadians from the government. Canadians have moved on it aggressively themselves and they will continue to do so. Safety and security are areas of priority.

We talk about an oncoming recession. The government needs to get its priorities straight on national security but it needs to be honest with Canadians about the deteriorating state of our economy and the nation's finances. We are tired of empty accusations from the finance minister and the Prime Minister when we raise, as we have been raising for a long time, questions about the economic recession which we were in pre-September 11. We get accused of being unpatriotic. Economists, like Jeff Rubin at the CIBC, predicted over a year ago that within 18 months the dollar would be sitting at 60 cents. We hit historic lows just yesterday. Mr. Rubin had better be careful, the Liberal thought police may be coming to arrest him for being unpatriotic. The government has to become honest with Canadians about this.

Last spring we issued many well-founded warnings about a potential downturn in the economy, one which we were witnessing was taking place before our eyes. We talked about the need for the federal government to tightly control spending in order to avoid going back into a deficit. We talked about that over a year ago.

The Minister of Finance and the government dismissed our concerns and continued to whistle past the economic graveyard and go down the path of increasing our vulnerability to a bleak economic picture. The minister's budget will not be able to hide the fact that he and the government led us into a recession. A decade of economic drift, as I have already indicated, has led us into a full blown recession and all of these indicators were in place before September 11. We are getting tired of the disaster and horror of September 11 being used to cover up the government's out of control spending and poor management which was happening well before that.

The aftershocks of September 11 clearly deepened our economic trouble. That is a fact. Let there be no doubt though that Canada was headed toward a serious slowdown before that tragic day. Economic growth screeched to a halt in the second quarter of this year and it is almost certain to contract in the third and the fourth quarters, with many economists predicting that the slide could continue well into next year. We hope that will not the case but many economists are saying that it will be.

The government should not be accusing us of being unpatriotic because we are concerned about the future and economic uncertainty of Canadians.

Employment was up before September 11. Thousands of job layoffs have taken place. The dollar hit an all time low yesterday.

As the Canadian dollar plummets, it is reaching out in desperation to grab on to some twig of confidence from the government but seeing none it continues to move downward.

The finance minister has allowed spending to get out of control at a time when revenues are beginning to contract. Yesterday's surplus may soon turn into tomorrow's deficit. Many economists, Dale Ore of WEFA, Don Drummond of the TD Bank and others, had predicted these planning deficits by the year 2003. The federal Liberals have been running three year projections in terms of where their spending was taking them. We analyzed the numbers and we could see that they were headed for a deficit before the three year mark. What was their response? They quit the three year planning and they put out two year projections.

If there is a projection that comes out that says we could hit a deficit in two years, maybe all they are going to do is project one year. It is irresponsible. They need to tell Canadians what we are facing. By knowing what we are facing we can prepare for it.

The Bank of Nova Scotia, for instance, is projecting an annual federal deficit of $5 billion by next year. What will that mean? Will it mean that our next projection will be only a six month one because we want to avoid the ones that people are putting out?

If the finance minister and the Liberal government lead us back into deficit, the slowing economy will not be to blame. Out of control spending, fuelled by the undeclared Liberal leadership campaign, has put at risk the surplus that the taxpayers have paid so dearly to achieve, paid for by a reduction in spending on security, a reduction in spending on national defence and a huge reduction in spending on our health care needs.

Spending jumped last year by 7%. That was twice the level of inflation plus population. The finance minister has allowed spending to so far exceed his targets year after year and to exceed this phenomenal growth in revenues being paid by taxpayers. If spending in the current year was at the level projected by the minister in 1997, we would have had a solid surplus of approximately $25 billion if he had kept his surplus in check rather than the $8 billion that most forecasters are predicting.

Markets look for signs of restraint in government spending and accounting but they have not seen it from this government and have made a judgment according to the value of the Canadian dollar.

The government must get its priorities straight. On the economic and fiscal front that means keeping a balanced budget while reallocating resources from low priority, unproductive spending to areas of high priority, including areas of continuing the stimulus effect of tax reductions in very necessary areas.

To stimulate and create jobs and create investment, the government must continue to implement the tax changes it announced last fall. It also has to proceed with other areas of taxing business and individuals in terms of high input costs, EI premiums being one alone where we have far in excess of what we need, even with the oncoming recession, in terms of the insurance fund being there. The government takes those hard-earned dollars, taxing individuals and businesses for employment insurances, and launches the money into all kinds of spending that has nothing to do with employment insurance.

The government should sit down and consider including a yearly basic exemption, as suggested by various industry groups, when it comes to EI. We must also look at eliminating or bringing down the very destructive capital tax. As recently as yesterday the finance minister pointed to capital going to the United States. Why does capital flee? It looks for quality and certainty. The government has provided neither. We have to start doing that and we can within our various systems.

These measures in the areas of input cost reductions and tax reductions can be accommodated within the existing budget. People across the way say that we should spend, spend, spend. Yes, we should spend on priorities but we should reduce on discretionary and wasteful spending.

Only if the government puts a freeze on all future discretionary spending and controls spending in the low priority areas can we do these things, but they can be done. Let us not respond in panic and fear to the accusations that they cannot be done. It is a matter of discipline. These are critical if the government is going to leverage the fiscal policy to join the Bank of Canada's efforts to fight this Liberal recession.

I served as a finance minister in a time when commodity and oil and gas prices were going down. Even in a down time of plummeting commodity prices and with the Asian crisis, we had the discipline and foresight to continue tax reductions to send the signal of confidence to the economy, an economy which continued to be confident because it was being stimulated; investment staying instead of fleeing. That is what has to happen here.

When the finance minister tells us there is no room for additional relief in these areas, I have to question him. Where did he find the extra $6 billion for the ministries of industry and human resources development, those great stewards of the public purse, to spend on those pet projects? Then he says there is no room to allow Canadians to keep their hard earned money in their pockets.

Canadians know that an extra dollar left in the hands of a hard-working citizen or innovative entrepreneur will do a lot more to create jobs and wealth than a dollar in the hands of a federal Liberal politician. Canadians continue to suffer. Every time the finance minister gets up and does his arm waving he never addresses these facts.

We have the highest income taxes in the industrialized world. That is a fact. I want to see the arm waving today when he gets up and starts talking about the great things he is doing for Canadians.

The government needs to get its economic priorities straight by spending less on interventionist pet schemes that do not work and putting more on priorities for Canadians by allowing them to keep more of their hard earned money in their pockets.

The upcoming federal budget represents an enormous missed opportunity by failing to take more decisive action in all the areas I mentioned: proper spending, tax reduction and paying down debt. We will watch for the arm waving today. Any way we shake it out, even though there have been payments on the debt, and the official opposition has acknowledged those payments, they have not been what they could have been. It is another hallmark of the era of lost opportunity and the federal debt today stands higher, at $557, billion than it was in 1993. That is the plain basic fact.

Yes, when the surplus has been splashing over in its economic bucket, the government has allowed some of that to go to the debt but not as aggressively as it should have. It has not legislated the down payment of debt.

These are the signals the market needs to see so that investment will stay here and not run southward where it will be taxed at a less punitive rate.

Canada is headed into a recession exposed by some fundamental economic weaknesses. We continue to carry one of the largest debt burdens in the industrialized world. It costs taxpayers over $40 billion a year just to carry that debt. It costs $100 million a day to reduce a debt that should have been reduced far more aggressively and should have had a law behind it saying that a bigger chunk of the surplus would go to its reduction.

Our dollar has lost 25% of its value against U.S. currency since 1993. We want to see Liberals stand and applaud today when the finance minister gets up to address this. We want to see how loud the applause is when he says that it is true that our dollar has lost 25% of its value since those people took office in 1993. That makes all Canadians poorer relative to our American friends.

There is a 22% gap between the Canadian and U.S. standard of living, which amounts to a difference of $29,000 for an average family. We want to see the cheering on that today when the finance minister stands and does his usual rant. We want to see the pompoms go up in the air.

U.S. productivity has grown at a 50% faster rate than in Canada over the past decade. I want to see the finance minister go after the Chamber of Commerce for being unpatriotic because it has said the nineties will stand out as the poorest decade relative to growth since the 1930s.

All these figures point to Canada's greatest economic challenge, to stop the slide in our standard of living and eventually, as we stop the slide and put in place the proper policies that stimulate confidence, I believe that on the race track of economic growth we can sprint ahead of the American economy. We do not have to lag behind. Every time the dollar drops and debt increases or some other economic measure hits us, the finance minister stands and says that it is the Americans.

Canadians can outpace them. We are a little upset that this year the Mexican peso is outpacing the Canadian dollar relative to the U.S. dollar. We congratulate President Fox. We offer no congratulations to this finance minister for allowing that to happen. We want to hear those cheers today when he stands up and addresses these factors.

We have a vision of our economy being strong and focused, a government that is disciplined and our business, our people, our hard workers literally being able to sprint past the Americans when it comes to productivity and growth. It is possible as long as we have a government that can recognize that.

The United States congress is in the process of passing an economic stimulation package that includes $100 billion in immediate tax relief on top of the $1.3 trillion tax cut that was passed earlier this year.

Canada cannot afford to stand still. The flight of capital and people is happening. There are 98,000 highly educated, highly skilled Canadians moving south this year alone. We have to get our economic priorities straight. That does not mean just more stimulative tax relief but tax reform that is designed to reduce and eliminate the disincentive that Canadians face right now when it comes to work, savings and investing.

The Alliance proposal is to eventually eliminate the marginal income tax rates. That would be a clear step in the right direction. The federal government should also explore ways to move Canada away from its huge overreliance on income taxes. It has to continue to look at reforming taxation, especially corporate taxation, relative to the recommendations brought forward by the Mintz commission.

If we are to close this gap in the standard of living, we must also implement some structural reforms, especially related to inefficient programs. The government took a big step backward in this regard, with Bill C-2, by rolling back its own very modest employment insurance reforms out of political fear and nothing else. Instead, we would pursue experience, rating and other reforms designed to modernize Canada's labour markets.

We should reform equalization to stop penalizing provinces that are starting to get ahead, especially those provinces having the ability to move ahead thanks to their non-renewable resources. Possibly for the first time since Confederation, Atlantic Canada has the opportunity to realize the promise of Confederation. However the federal government will continue to clawback its hard earned efforts at moving ahead. That is unacceptable.

The federal government has to drop its dogmatic approach to health care. Health care costs continue to skyrocket through the roof. The government's response has been to not restore health care to its 1995 levels. This is an economic situation as much as it is a health care and security situation. The government must begin to allow provinces to be innovative with internal market mechanisms within the public system, if we are going to preserve our provincial economies and help them to weather the storm that was set loose upon them when the government slashed their health care transfers by almost 35%.

We have to pursue serious reform of some of our entitlement programs to ensure that they are sustainable, making sure that maximum return to those people, especially on fixed income, is achieved. There are many ways in which that can be done. This federal government refuses to look at those possibilities.

The government should exercise real leadership in terms of striking down provincial trade barriers. It has not done that. It should be pulling the provinces together in many areas where those barriers still exist and get the type of reduction in those provincial trade barriers that is necessary.

Federal regulations need to be analyzed in a way that the costs are looked at carefully as to what regulations are effective and needed and which are ineffective, outdated and unneeded. That is a huge cost to business and a drag on our economy.

Rather than taking any of these bold steps to strengthen our economy and to secure our future, the finance minister, along with the rest of the government, continues to be adrift. The government ship of state is adrift at sea, tossed about on the waves of circumstance without an anchor when needed, without a compass when needed. For every serious challenge we face, the recession, the falling loonie, our slide in productivity, the finance minister blames some external forces.

We can be masters of our own destiny but we have to take charge. In difficult times like these Canadians want and deserve tough decisions, not familiar excuses from their national government.

The Canadian Alliance will continue to do everything in its power to ensure that the government gets its priorities straight. These include providing adequate resources for our national security; fighting the Liberal recession, while maintaining a balanced budget; and reversing the current downward trend in our standard of living.

I move an amendment to government Motion No. 17 as follows:

That the motion be amended by adding:

“and in particular, the need to increase spending on national defence and public security by reducing waste and spending in low and falling priority areas, such as the proposed new Industry Canada-HRDC strategy paper, preserve and accelerate scheduled tax reductions, restore confidence in the Canadian dollar, and avoid falling back into a fiscal deficit.

Privilege

[John Reynolds, Canadian Alliance, West Vancouver—Sunshine Coast, BC]

Mr. Speaker, I rise on a question of privilege to charge the Minister of Transport with contempt. The minister has brought the authority and dignity of the House into question and has breached the new procedure that was established by the adoption of the first report of the modernization committee.

On Thursday, October 25, while the House was in session, the minister held a press conference to announce a $75 million bailout for Canada 3000. While this brand of disrespect is not uncommon for the Liberal government, I believe that this is the first time that such an act has occurred since the adoption of the first report of the modernization committee. At page 4 of that report the committee states:

Concerns have been expressed that government announcements, regarding legislation or policies, are increasingly made outside the House of Commons. While this is by no means a recent phenomenon, it continues to be a source of concern. The Committee is recommending two initiatives to address it.

First, it is important that more ministerial statements and announcements be made in the House of Commons. In particular, topical developments, or foreseeable policy decisions, should be made first—or, at least, concurrently—in the chamber. Ministers, and their departments, need to be encouraged to make use of the forum provided by the House of Commons. Not only will this enhance the pre-eminence of Parliament, but it will also reiterate the legislative underpinning for governmental decisions.

The committee recommended that the government make greater use of ministerial statements in the Chamber and that the House leaders be advised in advance of these statements.

I was not advised of this announcement. When I stood in the House on Thursday and asked the Thursday question, the government House leader had the opportunity right there and then, but failed to do so.

There was no reason why the Minister of Transport could not have advised the opposition and there were no procedural difficulties preventing the Minister of Transport from making his announcement in the House. I am certain that all parties would have extended every courtesy to the minister if he had chosen to respect the House and make his announcement here.

It is important to know that the House adjourned early on that day for lack of business. It adjourned early last Monday and Friday and it adjourned early on Friday, October 19, and on Monday, October 22, so wherein lies the problem with debating these issues on the floor of the House? A $75 million bailout is no small change. Where does the minister think the authority to spend the $75 million comes from?

The government and its departments are continuously making a habit of mocking the parliamentary system in this manner. We have had the deliberate leaking to the media of contents of Bill C-15 and, more recently, of the anti-terrorism bill, Bill C-36.

One of the reasons the modernization committee felt it necessary to address the issue was that in the last two parliaments the government got away with mocking the legislative process at every turn, belittling the role of members of parliament. I will cite a few of the more serious examples.

On Thursday, October 23, 1997, the government announced that provincial and federal governments had constituted a nominating committee to nominate candidates for the new Canada pension plan investment board. The nominating committee was provided for under subclause 10(2) of Bill C-2. The House had not yet adopted Bill C-2.

On January 21, 1998, the minister responsible for the wheat board met in Regina to discuss the rules for the election of directors to the Canadian Wheat Board's board of directors, as proposed in Bill C-4, an act to amend the Canadian Wheat Board Act. Substantial amendments to Bill C-4 tabled at report stage by opposition members were scheduled for debate in the House. While the House debated how many directors should be farmer elected versus being government appointees, the minister was holding meetings as though the bill was already law.

When the Canadian millennium scholarship fund was being established, a published article in the Toronto Star announced that Yves Landry had been named as the head of the Canada Millennium Scholarship Foundation. Mr. Landry was quoted as saying “I am only one member of the board and my job is to be a facilitator”. There was no legislation before the House setting up the foundation, nor had the budget announcement allocating $2.5 billion in revenue to the foundation been adopted.

The Minister for International Trade announced on March 30, 1998, the establishment of a Canada-China interparliamentary group. At that time, the House had not set up a Canada-China interparliamentary group.

Finally, the date of the last budget that was delivered in the House, so long ago we have probably forgotten, was announced by the Prime Minister outside the House.

Each disrespectful act we allow to stand unchallenged becomes a precedent that serves afterwards to justify more acts of disrespect. The modernization committee recognized this and felt it necessary to make a statement.

The adoption of this report outlined what standard the House expected from ministers in this regard.

On page 119 of Erskine May there is a reference regarding a select committee that was appointed to inquire into the conduct and activities of members and to consider whether any such conduct or activities amounted to a contempt of the House and whether any such activities were:

--conduct...inconsistent with the standards the House was entitled to expect from its Members.

The minister cannot claim ignorance because the House pronounced itself on this issue through the adoption of the modernization committee report. When the Minister of Transport made his announcement outside the House on Thursday, October 25 while there was still an opportunity to make it inside, his conduct was clearly inconsistent with the standards the House was entitled to expect from him. As a consequence the minister is in contempt of the House.

The other related parliamentary tradition that the government likes to forget about is the issue of and respect for the doctrine of ministerial responsibility.

The Minister of Transport and the rest of his colleagues, and particularly the Minister of Justice, should review the definition of ministerial responsibility from page 63 of the 22nd edition of Erskine May. It states:

—ministers have a duty to Parliament to account, and be held to account, for the policies, decisions and actions of their departments...it is of paramount importance that ministers give accurate and truthful information to Parliament—

Where can we find the truthful and accurate information regarding the decision to hand out $75 million to Canada 3000? Not in Hansard of Thursday, October 25. Where it was found was in the Globe and Mail of October 26.

I am beginning to think that being held in contempt in the House is of little concern to the government. Let us look at the example of the Minister of Justice who was held in contempt for leaking to the media the contents of Bill C-15.

When I appeared before the Standing Committee on Procedure and House Affairs to review another charge of contempt involving the minister, I pointed out that we no longer respect, to the same degree as in the past, the principle that ministers have a duty to parliament to account and to be held to account for the policies, decisions and actions of their departments.

I cited the example from 1976 involving the Hon. André Ouellet, the then minister of consumer and corporate affairs. Mr. Ouellet made a comment on the acquittal by Mr. Justice Mackay of the sugar companies accused of forming cartels and combines. As a result, Mr. Justice Mackay cited him for contempt of court. He was found guilty of the charge and resigned his cabinet post over the incident.

A charge of contempt by the House should be considered just as serious, if not more serious, as a contempt charge in a court. Unfortunately the Minister of Justice chose not to take responsibility in the time honoured tradition of ministerial accountability, as did Mr. Ouellet.

Getting back to this case, I will conclude my remarks by saying that had I had an opportunity to respond to this announcement by the Minister of Transport I might have asked the minister why he can justify giving Canada 3000 $75 million but cannot spend one dime on the softwood lumber industry that lost millions of dollars over a trade dispute with the United States. Thousands of people are out of work as a result and thousands more are expected to lose their jobs.

Also, what about the farmers who suffered through this summer's drought?

These are some of the questions we might have asked if the minister had given us an opportunity, but we did not. The minister might want to talk about timing, about how the House was not sitting. It was not sitting because the government chose not to have it sitting. It adjourned early. We have adjourned early too many days over the last little while.

Certainly I saw the minister on television that night at 7 p.m. The House adjourned early,and I cannot remember if it was 3 p.m. or 4 p.m., but surely he must have made the decision earlier in the day. He could have spoken to the government House leader and made sure it was put on the agenda so that we could have done it in the House and it could have been done properly.

Mr. Speaker, if you find that we have a case of privilege, I am prepared to move the proper motion.

Employment Insurance

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Speaker, my question is for the minister responsible for the Atlantic Canada Opportunities Agency.

The government decided to ignore the recommendations made by the members of the Standing Committee on Human Resources Development, which were supported by the Liberals, outlined in a report entitled “Beyond Bill C-2”, regarding changes to the employment insurance program.

Given this decision, what steps does ACOA intend to take in order to help people who will have to deal with the gap next January?

[Gérard Asselin, Bloc, Charlevoix, QC]

Mr. Speaker, back in May, the Standing Committee on Human Resources Development presented to the minister a unanimous report on the urgent need to go beyond Bill C-2.

Close to five months later, the Liberal government responded to the 17 recommendations by rejecting all of them. Even though six out of ten people who are unemployed continue to be excluded from the employment insurance program, the minister simply said that everything was fine.

Yesterday, when the minister was unable to indicate the estimated EI surplus, she justified her ignorance by saying that it was a “notional” surplus.

The minister showed once again that she is in over her head as a cabinet member and that she remains insensitive to the workers' plight.

Committees of the House

[Jane Stewart, Liberal, Minister of Human Resources Development]

Mr. Speaker, pursuant to Standing Order 109, I am pleased to submit herewith two copies, in both official languages, of the government's response to the report of the Standing Committee on Human Resources Development and the Status of Persons with Disabilities entitled “Beyond Bill C-2: A Review of Other Proposals to Reform Employment Insurance”, that was tabled in the House on Thursday, May 31.

The Acadians

[Raymonde Folco, Liberal, Parliamentary Secretary to the Minister of Human Resources Development]

Mr. Speaker, I can assure my colleague opposite that the government and the minister in particular are in the process of drafting their response to the recommendations of the House standing committee that looked at the EI issue. We will respond to the committee report within the timeframe prescribed by the act.

I can assure my colleague and all members of the House that this concern about a certain clientele that is not covered under the employment insurance plan is shared by government members as well.

That is why, over the last few years, we made changes to the plan to ensure that it meets the needs of Canadians and is better adapted to the changing labour market.

Most recently under Bill C-2, the bill on employment insurance which the House passed, we eliminated the intensity rule because it did not improve workforce attachment. We adjusted the clawback provision which no longer applies to Canadians who seek temporary income support for the first time or those who receive special benefits.

Under Bill C-2 parents coming back to work after taking care of young children qualify for regular EI benefits with the same number of hours required of other workers.

Each year we assess the impact of the plan on Canadians across the country. We will continue to ensure that it is well adapted to the changing labour market and to the needs of Canadians. Our plan is flexible and it meets the needs of Canada's labour force.

Employment Insurance

[Jane Stewart, Liberal, Minister of Human Resources Development]

Mr. Speaker, let me remind the hon. member that the employment insurance system is sound and it is there for Canadians who need it. Let me also remind the hon. member that our government makes changes where there is evidence that changes need to be made.

I remind the hon. member that we recently made changes in Bill C-2, and I remind the House and the hon. member's constituents that they voted against those changes.

[Jane Stewart, Liberal, Minister of Human Resources Development]

Mr. Speaker, first, I want to assure the hon. member and tell him that the employment insurance program is sound and it will be there to support the Canadians it is intended to support.

Our most recent monitoring and assessment report indicates that 88% of Canadians in paid employment would be eligible for benefits if they need them. Having said that, the government continues to make improvements in the program, and we need look no further than Bill C-2 for indications of that approach.

[Jane Stewart, Liberal, Minister of Human Resources Development]

Mr. Speaker, as I have said time and again, the Government of Canada monitors and assesses the impact of the Employment Insurance Act on Canadians and we make changes as changes are necessary. That is why we doubled parental benefits. That is why we introduced and passed the amendments in Bill C-2. That is why just last Sunday we published in the Canada Gazette a proposal to change EI regulations that would guide the treatment of undeclared earnings.

Those changes were proposed so that the EI program would be more reflective of the work patterns of claimants. It is an idea that was presented to us by the FTQ, as well as other stakeholders. Again I point out that we make changes as warranted.