Bill C-28 (Historical)

Budget Implementation Act, 2003

An Act to implement certain provisions of the budget tabled in Parliament on February 18, 2003

Budget Implementation Act, 2003

[Roger Gaudet, Bloc, Berthier—Montcalm, QC]

Mr. Speaker, I would like to come back to the amendment of clause 64 of Bill C-28. When the budget was brought down on February 18, the Minister of Finance proposed a retroactive amendment that goes farther than the December 21, 2001, proposal, in that it circumvents the judgments obtained in their favour by school boards in Quebec and Ontario.

In order to start at the beginning of this, I have a letter from Stikeman Elliott dated January 15, 2002, addressed to the hon. member for LaSalle—Émard, former minister of finance, which reads as follows:

Proposed amendment to the GST/HST affecting school boards.

Mr. Minister:

This letter is in reference to the news release issued by your department on the evening of December 21, 2002, regarding the aforementioned subject.

We represent Consultaxe Planification (1996) Ltée, a firm of tax consultants from Montreal, and through them, 111 of the 415 school boards in the provinces of Quebec, Ontario, British Columbia, Alberta, Saskatchewan, Manitoba and Nova Scotia.

We have been instructed to inform you and your colleagues that our clients are completely opposed to the proposal contained in your release. Furthermore, they intend to rigorously defend their interests and their rights on this matter, as they feel they have suffered a serious injustice.

On October 17, the Federal Court of Appeal ruled unanimously in favour of the appellant school boards, the Commission scolaire des Chênes being the test case. The court ruled that studenttransportation is a commercial activity that is eligible for 100% input tax credits, under provisions of the Excise Tax Act (GST/HST) affecting school boards and their provision of student transportationservices.

The appellants were 29 Quebec school boards, whose cases were the first to be appealed.

The first cases started being heard in 1996 and over the years, these same school boards or the corporate entities that have replaced them as a result of the numerous mergers that occurred in 1998, submitted new claims. Also party to these claims were many school boards in Ontario, Manitoba, Saskatchewan, Alberta, British Columbia and Nova Scotia. Most of these claims, at the time of the ruling, were pending before the courts while awaiting the judgment in the test case mentioned above.

At the time of the judgment, the amount of GST in question represented approximately $70,500,000.

On December 21, 2001, the Department of Finance proposed amending the act so that school boards could only claim a partial GST/HST rebate. This amendment,if adopted as proposed, will be made retroactive to January 1, 1991, the date the GST was introduced. The proposal mentions that “the proposed amendment will not affect any case that has already been decided by the Federal Court”.

This means that the initial claims of the 29 school boards in Quebec will be reimbursed because they were the first case to be heard by the Federal Court, but their subsequent claims, as well as those of other school boards whose appeal cases were before the Tax Court of Canada pending the aforementioned ruling, will not be reimbursed.

Amending the Excise Tax Act is one thing. However, our clients feel that amending it retroactively to eleven years prior to the date of the ruling, and affecting cases that are pending before the courts is an abuse of the law and power and constitutes flagrant discrimination against the school boards that have cases pending.

Given your considerable political experience, you can easily imagine the reactions from school boards that have been treated this way. These institutions with cases under appeal feel that they have been prejudiced and deprived of a fundamental right, that of having the government respect a ruling by a federal high court of justice. Your department will no doubt respond by saying that it is respecting the judgment because it did not set aside the ruling involving 29 Quebec school boards, insofar as concerns their initial claims. However, this disregards all of the other cases under appeal, which are based on the same fundamental point of law. In order to avoid incurring needless costs for all of the parties involved, including the federal government obviously, it was decided to suspend proceedings for these cases and proceed first with only the 29 school boards mentioned above. Once a final ruling was handed down by the courts, all of the other cases could have been resolved accordingly. However, the legislative amendment proposed by your department would have the effect of retroactively reversing this arrangement. Needless to say our clients feel that the Department of Finance is playing the role of the better who says: “Heads, I win; tails, you lose”.

Therefore, we urge you, Mr. Minister, to reconsider this proposed amendment in order to make it fair for all school boards in Canada who were involved in these claims. This amendment could be made retroactive only to the date of the judgment for all school boards in Canada with cases pending before the courts at that time.

Respectfully,

The Honourable Marc Lalonde

c.c.: Members of the federal cabinet

I do not know if all of the government members received a copy of this letter, but I am prepared to give them one.

[Judy Wasylycia-Leis, NDP, Winnipeg North Centre, MB]

Mr. Speaker, I am pleased to have another opportunity to speak as loudly and as clearly as possible against Bill C-28, the budget implementation act.

Let me begin by saying it has been about three months since the government brought down its budget. The initial flash of the cash has had some time to wear off and Canadians have had time to take a closer look at the significance of the budget in meeting the pressing needs of Canadians.

The closer scrutiny has not favoured the government. As the hoopla dies down, more and more Canadians have come to the same conclusion the New Democrats have, and that is the government has failed to invest adequately in Canadians and has failed to invest in building the society that we want and need for the future of this country and of our children.

The inadequacy of the budget becomes very clear when we compare what the government has budgeted with what Canadians actually need. When we look at what the government has done with the fraction of the surplus it has left, after its ongoing tax cuts and the billions it continues to spend on paying down the debt, we realize just what a low priority the social needs of Canadians are for the government.

The government could learn from the Alternative Federal Budget process. The AFB builds its budget from the ground up, developing a coherent fiscal strategy toward achieving the social goals of Canadians, and it does it all within a balanced budgetary framework. It does not fudge surplus estimates to accomplish hidden agendas. In fact it has been far more accurate than the government in estimating realistic economic performance and surpluses over the years.

In looking at the budget, every sector of our society has come to its own conclusions. Let me just take a look at the issues pertaining to the status of women as one example.

Shocking to us all, Canada has been recently criticized by the United Nations for not living up to the Convention on the Elimination of All Forms of Discrimination against Women. What a scathing commentary on a country so wealthy and prosperous as Canada.

The UN has issued a report suggesting Canada has failed to move forward on a long list of measures to improve gender equality. One of the chief areas of concern was the disproportionate impact on women caused by the government's earlier cuts to social programs, cuts that happened under this government 10 years ago, under the member for LaSalle—Émard, and continued on by other members, including the present leadership candidates who are in the race today. The UN report calls on Canada to re-establish national standards in social programming.

The real test of Liberal commitment on this issue is not what the leadership candidates are saying but whether it is in this budget. Does the budget do this? Is the government's $25 million baby step toward a national child care program a sufficient response?

There are 4.9 million children in Canada under the age of 13. Three thousand child care spaces divided across the entire country will obviously leave hundreds of thousands of women without the support they need to work out of the home. Child care advocates have told the government time and again that even to begin building a national child care program about $10 billion will be needed during the first four years; $1 billion in this year alone.

This budget does not cut it. It does not advance the status of women and take us closer on the path toward true equality between the sexes.

The United Nations also has called for improvements to employment and employment insurance to make it easier for women to enter the workforce and stay there at better paying jobs.

What do we have? We have a government that makes it harder to benefit and keeps inflated premiums to the tune of $43 billion in a surplus. Did the government introduce changes to the EI system to help low wage part time working women access that huge surplus by expanding those covered or by bringing in programs to improve their skills and marketability? No. Not only has it not taken those initiatives, but it is still, as we speak, using public money to finance court battles to keep working women, like Kelly Lesiuk in Winnipeg, from getting the EI support they deserve. I am sure that impresses the world community.

The recent census information released earlier this month by Statistics Canada confirms absolutely that we have to do more. After a decade predominant with the Liberal government at the controls, single parent families, headed mostly by women, continue to lag more than 50% behind the national income average.

Violence against women is a very important area if we are to really deal with the status of women agenda and pursue women's equality. It is an area with a devastating impact on the lives of Canadian women and another area where the United Nations has called for action. Yet despite its acknowledgement of the ongoing violence against women, and tragically evidenced again last week in Mission, B.C., it is not a priority in this budget. For example, more second stage housing is urgently needed to help women re-establish themselves after escaping intolerable, violent or abusive situations. Apparently it is not a priority for the government.

There are so many other areas to address in this budget. I know my colleague, the member for Winnipeg Centre who has led a heroic battle at committee dealing with Bill C-7's aboriginal self government legislation, will have lots to say about how the government and how the budget fails first nations communities, how it has failed to address third world conditions on reserves and how the money in this budget is a drop in the bucket when it comes to that shameful aspect of Canadian history and society.

There is a gap in this budget when it comes to the rich and the poor, when it comes to first nations communities and other Canadians and when it comes to men and women. There is a gap when it comes to a government providing adequate housing, health care, education and child care. There is a clear gap especially in the area of health care, an area that has been an issue before the House time and time again. One would have thought that this budget would have closed the gap, would have avoided what we now know to be the Romanow gap, a shortfall of some $5 billion in terms of meeting the basic requirements of sustaining a health care system for the future.

We had thought we would get some clearer answers about what the share of the federal government is with respect to transfer payments to provinces for health care. We had thought, in the final stages of the budget process, we would get some answers but still we cannot get a straight answer out of the government on health funding; old money, new money, cash and tax points. This is exactly the situation that the Romanow Commission foresaw and tried to avoid.

We have a lot more to say about this budget and why we oppose it. Health care is one of those critical areas where the budget falls far short of what is required. The government's patchwork approach, whether in health, housing, community infrastructure, the environment, may serve the Liberals' short term political interests but it is ineffectual in providing the social investments Canadians need so critically.

Throughout our examination of Bill C-28, New Democrats have presented constructive alternatives and tried to focus the government on investing in Canadians. We have failed to this point. The government has turned away from us, from Canadians needing housing, women needing better employment support and an end to violence, children still mired in poverty, first nations living in third world conditions, those trying to ensure our very survival on this planet, and the list goes on. It leaves us no alternative but to vote against this budget and this bill.

[Gilles-A. Perron, Bloc, Rivière-des-Mille-Îles, QC]

Mr. Speaker, this is the second time I have spoken on Bill C-28. In my previous remarks, I objected vigorously to clause 64 of the bill before us.

Even though my hon. friend from Trois-Rivières has stolen some of my thunder, I want to give the history of this from A to Z.

Clause 64 is going to punish your grandchildren and mine, and all students in Canada. The problem is that money is being taken from the pockets of the 415 school boards in Canada, including 72 in Quebec, and a serious shortfall is being created.

I will go on with my historical analysis. This shortfall will result in fewer services or higher school taxes in order to provide the same service to our students who use school buses. The majority of these are elementary students, not high school or university students. I think of my granddaughter and this situation upsets me.

I will remind the House of the problem of input tax credits as they apply to school transportation. In 1991, when the GST was introduced, the federal government, through the Minister of Finance, gave a 100% tax credit on school transportation. In 1996, a unilateral change was made by the Minister of Finance at the time—now the front runner in the Liberal Party's leadership race.

I will just explain how we use the word front runner in Quebec. It means the horse that leads the race, that is running at the front of the pack, the one that has a good chance of winning. That is the member for LaSalle—Émard. The runner-up, of course, is the one in second position. In this case, it is the current Minister of Finance. In his budget and in Bill C-28, he has clung to an invention of the Liberal Party's current front runner.

So, as I was saying, in 1996, the front runner in the leadership race reduced the input tax credits from 100% to 68%. Naturally, there was an outcry from the school boards. They stood up and fought the current front runner in the Liberal Party's leadership race. Nothing changed. The former finance minister was deaf, possibly blind, and possibly mute, but he never gave an answer. Nothing changed.

Finally, a school board in Quebec—the Commission scolaire des Chênes—filed suit and took the Minister of Finance to court. On September 12, 2001, at hearings in Montreal, Justices Alice Desjardins, Robert Décary and Marc Noël, heard the case with lawyers representing the school boards and Her Majesty the Queen.

On October 17, 2002, the three Federal Court of Appeal judges ruled unanimously in favour of the Commission scolaire des Chênes. What an insult to our front-runner. How did our-front runner resolve the problem?

He issued a press release dated December 31, 2001 which said, “No problem. What we will do is change the legislation retroactively to 1991 to get around or tie the hands of the three Appeal Court justices who handed down this judgment”.

We are talking about a judgment. This is truly an exceptional move. This is the first time in history that legislation has been passed in order to circumvent a judgment. This leaves the door open for any minister who has been taken to court and lost to decide simply to change legislation. This is precedent setting.

Perhaps unwittingly or without realizing it, the runner-up, the current Minister of Finance, just included clause 64 in Bill C-28. The last time I spoke on clause 64, I had a discussion with my Liberal colleague from Laval East—a nice lady with an open mind—who told me she was not aware this was going on. I said I had a huge file which I could show her, because as the revenue critic, I had the opportunity to meet people involved in this issue. She said, “I did not know; this is terrible. We are penalizing our children”. She was horrified, adding, “I will take this up with the caucus”. What happened? When the time came to vote on the bill following the clause by clause study, she stood up and voted against the motion by the hon. member for Drummond to delete clause 64.

This is an insult to all parents. I am begging you, Mr. Speaker, today. This concerns the school boards in the Cornwall region. They are experiencing a shortfall. I urge the hon. members across the way, members from every part of Canada, to push for this clause 64 to be deleted because it is penalizing their school boards and their children or, if they have grey hair like mine, their grandchildren. This is an important issue.

Now people are going to say, “There goes the evil separatist. This nasty Bloc member, this damn sovereignist is getting all worked up”. The fact is that I am not alone. I have here a three-page letter from former finance minister Marc Lalonde. I think that you know him, Mr. Speaker. He is one of your friends who used to be a minister—

[Yves Rocheleau, Bloc, Trois-Rivières, QC]

Mr. Speaker, I am pleased to rise and debate Bill C-28, a bill to implement the 2003 budget.

First, I would like to congratulate my colleague, the member for Drummond, for having brought to the attention of the House section 64 of this bill, which deals with the government's attempt to recover GST rebates that Canadian school boards received.

We know that the GST is considered an input. This involves the whole system of GST inputs and outputs that the Liberals wanted to scrap a few years back, in 1992-93. Yet, today, they are such staunch defenders of it that they are prepared to violate the ruling handed down by a court. I say this because the court handed down a unanimous ruling saying that the school boards' position was perfectly right.

This involves public money at two levels, at the federal level and at the school board level. The provincial governments have not sat idly by, particularly given the amount of money involved--$70 million at the time the judgments were handed down. Their concerns are outlined in a letter written by the counsel for the school boards, who—by coincidence or very clever strategy by the school boards—hired the eminent legal expert, Marc Lalonde, a former minister of finance himself and colleague of the minister of finance at the time, the member for LaSalle—Émard, equally eminent, you will all agree. In his conclusion, the Hon. Marc Lalonde, counsel in this case, said on behalf of his clients, the school boards, and I quote:

Needless to say our clients feel as though the Minister of Finance is playing the role of the better who says, “Heads I win; tails, you lose”.

As I was saying, the court of appeal ruled in favour of the school boards unanimously on this matter. The government, in response, decided to pass legislation that would exempt it retroactively, in what can only be described as a flagrant abuse of power. Therefore, the legislation is retroactive, which exempts the government from any rulings against it in this matter. We cannot accept this type of retroactive legislation. This type of response must never be accepted.

This may illustrate the culture of this government, of the past Minister of Finance or the present one. Imagine what a fine choice there is: the old and the new finance ministers both prime ministerial hopefuls. Canadians, and proud of it, that's for sure. There is lots to be proud of when we see these two competing for a new job, given their recent past performances.

I would like to congratulate my colleague for having raised the consciousness of this House on this. I would also point out that, once again, we have total silence from the other side, from the Liberals from Quebec. They are keeping mum when there is anything to do with public funds, as I have said, not just at the federal level here but also in Quebec and at the level of the school boards. Once again, these members are not saying a word, rather than backing the cause that has been presented by my colleague for Drummond.

There is one other point I would like to draw to your attention concerning three flaws in this budget. The first of these is the total absence of any reference to the restoration of the older worker adjustment program or an equivalent. This is a program that was around in the 1980s and 1990s and one I had the pleasure of administering when a Quebec public servant, with the help of my federal colleagues.

This program started off as the workers assistance program and evolved into POWA, the older worker adjustment program. For the most part, it applied to major plant closings—a heavy blow to any community—and was for workers aged 45 and over who found themselves facing a somewhat closed labour market and saw themselves doomed to welfare, given their level of education.

So this was in addition to unemployment insurance and a highly intelligent and well-targeted measure that met an obvious social and economic need. It was well thought out and yet it was made to disappear arbitrarily, more or less. Now there is a refusal to resuscitate it, despite the sad situations I have seen in my riding, with the closures of Tripap and Fruit of the Loom, for instance.

Six hundred women have been forced onto unemployment and will soon be on social assistance. Representations were made, by us and by many of our colleagues in this place and probably others across Canada as well, to get the government to make amends by establishing such a program. It keeps turning a deaf ear, and this budget is no exception. I want to once again condemn this kind of mismanagement.

Second, as mentioned earlier, is an issue raised by my hon. colleague from Champlain which concerns tens of thousands of Quebeckers who are vulnerable or old: the guaranteed income supplement. This guaranteed income supplement augments the old age pension for a number of Canadians and Quebeckers who are unfortunately having a tougher time of it than others.

There is a supplement but because it is so very generous, as we know, the federal government is making sure that thousands of individuals who have neither the physical nor the intellectual capacity to demand this supplement never get it, because it is not sent out automatically. There is so much involved in applying that those who need it are deprived of the supplement. They are badly in need of it, but they cannot fill out the forms. That is what is likely to happen, if I understand correctly the problem very aptly described by the hon. member for Champlain, whom I want to congratulate once again.

So this government which is raking in billions of dollars—this will never be overemphasized—has no solution to offer, no sympathy, no empathy.

Perhaps because of my interest in and concern for foreign affairs, I would like to raise a third point: international aid. In spite of all these billions it has at its disposal, Canada will not go along with what the United Nations Organization is proposing. A member as prosperous and developed as Canada should allocate 0.7% of its budget to international aid, as do the Scandinavian countries. Instead of 0.7%, it is a mere 0.3%.

So, it is slightly disgraceful that a country that benefits from the international community's largesse, that is rich in natural resources, that has been developed, like others, at the expense of underdeveloped countries—there is no denying it—refuses to be more generous. It is a complete disgrace. I am certain, and I dare hope, that a sovereign Quebec would be much more sensitive to such concerns, as are the Scandinavian countries that have been such models for Canada. So, it is somewhat disgraceful to see the Canadian government behaving this way with regard to international aid.

I would like to give a quick overview, because ten minutes is not a long time. What is working in this country? I want to look quickly at this. Are things going well with regard to the fisheries? Air travel? Aboriginal affairs? Agriculture, shipbuilding, health? Is the federal government part of the problem or part of the solution in health? I think it is more part of the problem. Are things going well with regard to helicopters? Employment insurance?

In ridings such as mine, 85% of those who lost their job were entitled to employment insurance; under the party opposite, only 40%, if not 38%, qualify and the government refuses to relax the rules. It continues to enforce strict rules, despite statements such as those our hon. colleague from Toronto—Danforth made earlier, about the hotel industry being devastated by fallout from SARS. We are seeing the same rigidity with regard to softwood lumber. There is a lot of boasting going on, but what is going well in this country?

If we take off our rose-coloured glasses, things are not going so well. In my opinion, the government's sole aim is to have a hand in everything in order to create a centralized, unified country at the provinces' expense. It is perhaps not so terrible that it is being done on at the provinces' expense, but it is at Quebec's expense, because there is an attempt to minimize the Quebec nation. We will continue to speak out, as long as we are here.

[Wendy Lill, NDP, Dartmouth, NS]

Mr. Speaker, it is my pleasure to speak on Bill C-28 today, the implementation of the budget. It gives me an opportunity to speak once again on some of the issues I have heard about from hundreds of constituents, which we in this House all know translates into thousands of Canadians.

I would like to speak on a couple of issues. One of them is the impact the budget has on persons with disabilities. There is also the impact it has on people who work on and enjoy heritage, culture and creativity in this country. Finally, I would like to speak about the impact of the budget on the needs of native children and on children in general.

I will start by saying that I have spoken out many times in the House about the disability tax credit and the fact that it does not meet the needs of Canadians. I am afraid that continues to fall on the deaf ears of the government.

On May 12, I moved an amendment to the draconian changes to the disability tax credit. I moved to have those amendments withdrawn from the budget, but that was to no avail. These changes go completely against the will of the House of Commons as expressed on November 19, 2002, when we all voted together as a House on a motion put forward by the New Democrats, which was:

That this House call upon the government to develop a comprehensive program to level the playing field for Canadians with disabilities, by acting on the unanimous recommendations of the committee report “Getting It Right for Canadians: the Disability Tax Credit”, in particular the recommendations calling for changes to the eligibility requirements of the Disability Tax Credit so that they will incorporate in a more humane and compassionate manner the real life circumstances of persons with disabilities, and withdraw the proposed changes to the Disability Tax Credit, released on August 30th, 2002.

At that time the Minister of Finance reluctantly withdrew the changes, only to reintroduce similar ones in the bill. That was a very major disappointment to people in the disability community and to the House. We feel that it was a contemptible act on his part. This credit is already so restrictive that officials from the department have admitted at committee that Terry Fox, if he were alive today, would not be considered as having a disability under the draconian interpretation of this law.

This is not a bill that has persons with disabilities in mind. I would like to review some of the changes within the budget that impact on persons with disabilities. First, the employment assistance for persons with disabilities program was renewed, but only with a $13 million increase over five years, which is less than the rate of inflation.

The disability tax credit, which amounts to about $400 million annually and goes to 450 million Canadians, provides a reduction of about $1,000 per recipient. The budget adds another $25 million this year and $80 million more per year starting in 2004-05, so what is wrong with this picture? The tax credit is still not refundable, so Canadians with severe and prolonged disabilities with no or low incomes still get nothing out of this credit. The proposed changes in the amount of the tax credit are insignificant, other than the normal increase due to indexation. The proposed changes to eligibility are designed to restrict eligibility: to reverse court decisions that said the eligibility was too restrictive.

The pilot project to recognize episodic and mental health disabilities through a consultation group is a welcome first step, but these types of disabilities need to be incorporated into the mainstream programs under the DTC and CPP and probably will need more than $25 million.

The child disability benefit, which will provide $1,600 more per year for disabled children in families that are eligible for the national child benefit supplement, is a good measure, but only families earning less than $33,000 will get the full credit.

I would like to move on now to the area of culture. The budget shows, in my estimation, very little concern for preserving and promoting Canadian arts and heritage. There is not a penny for the CBC and there is minimal cultural investment elsewhere. Specifically, there were increases of $150 million over two years to the Canadian television fund to increase Canadian programming, $20 million over two years for historic places, and $17 million over two years for Katimavik.

For cultural and heritage programs, the government added $187 million over two years, $150 million to the Canadian TV fund over two years, and $20 million for historic places, as I have said. However, by not renewing the $60 million to the CBC there will be cuts to real annual programming of $29 million for English TV, $18 million for French TV, $5 million each to English and French radio, and $3 million for new media.

Critical to cultural survival in this country is the future of Canadian television drama. This budget cuts the Canadian television fund by $25 million for what appear to be unknown reasons. As time goes by and more and more people come to the House and talk about the crisis in Canadian drama, it is an absolute mystery why the finance minister will not put that critically needed money back into the system, where it would then go toward triggering other moneys.

As many people have pointed out, the changes that were made in the budget for the film and TV industry in fact take money from Canadians and give money to Americans. In fact, there is a tax break for foreigners producing in Canada and a cut for Canadians who are trying to make their own culture here. As a result of the reduction in CTF funds, many Canadian made shows may have to be cut and others are in peril. Canadian TV dramas have gone from twelve to four currently in production.

As well, thousands of jobs are at stake. An actor who was here recently pointed out that the $25 million means much more than its face value because the money is then matched by private donors. If our government is unwilling to support Canadian TV content, why would private donors be willing?

Nor is Canada unique in providing government funding for television production, because most countries around the world also provide support. I know that some people see television production as an extra or a luxury when money is needed for so many other things. However, without Canadian made drama we would be left living our experience through American made dramas and would have a completely distorted sense of reality.

Trina McQueen's report to the CRTC about the dire straits of Canadian drama quotes Canadian producer David Barlow, who said:

If a society consistently chooses the dramatic fantasies of another culture, they come to believe that their own reality is not a valid place on which to build their dreams. Their reality simply isn't good enough for dreaming.

In 2003, that is a sad and tragic state for us to find ourselves in.

As a playwright I know first-hand how difficult it is for our Canadian artists and creators to earn a living. It is amazing that they continue to persevere as they do. We are all richer for it, yet there is nothing in the budget that really acknowledges the sacrifices that artists make, particularly as their average income is about $13,000 a year.

This budget does not recognize the needs of income averaging for artists. The budget does not in any way reflect the needs of artists to be eligible for employment insurance. Another way to acknowledge the contribution of our artists is through income tax breaks on the moneys earned by artists through their creative works. This is what my current private member's motion proposes. I know there are government moneys available through agencies such as the Canada Council for the Arts, but the council, for example, accepts only about 25% of the applications, and artists can apply only twice over four years.

I know that some have argued against treating artists as a special interest group in the tax system, but the reality is that our tax system has had many special interests, including students, persons with disabilities and persons contributing to their RRSPs. Why not spend additional credit on our artists in acknowledging their contributions?

Money for culture seems to suddenly appear when the Prime Minister's legacy is at stake, such as the $100 million for the political history museum in Ottawa. One wonders how much of that will be devoted to the Prime Minister's wing. While money definitely should be allocated to Canadian museums, I am wary of opening up yet another museum in Ottawa when so many regional museums need funding and this is not allocated in the budget.

I recently spoke to people at the Dartmouth Heritage Museum about their situation. As other museums across the country are saying, they need money to keep the lights on. They need money to hire curators and to collect artifacts. The regional museums across the country, of which there are over 2,500, need money to provide clean, dry storage for their artifacts. They need money for promotion. They need money to make sure they can collect the pieces of heritage from their regions and put them in a form that local residents will be able to see, value and understand as being part of a larger patchwork of heritage across the country.

As I said, there are over 2,500 non-profit museums and related institutions across Canada, which attract more than 50 million visits each year. With few exceptions they have been languishing under severe funding cutbacks for many years and are not funded adequately. Many buildings are crumbling and roofs are leaking. Collections of great local and national significance are threatened. Our collective memory is fading.

I would like to say that this budget has been a major disappointment in terms of heritage. The Canadian Museums Association and the New Democrats are saying that what we need is a comprehensive museum strategy instead of haphazard announcements that are more political than anything. We need to make available more funding for existing museums, particularly outside the national capital region.

To go back to the whole issue of the importance of museums, it is important to realize that more Canadians--and this is a very interesting statistic--go to museums than they do to sporting events. Local museums are like canaries in the mines: if the museum is in dire straits, it likely means that the town is in dire straits and that in fact there is trouble in many other sectors of the community already.

There have been many disappointments in the budget, but particularly critical are the cuts we see to Native Friendship Centres and the lack of any really effective anti-poverty strategies that would benefit the lives of aboriginal children. I would like to talk about the need for funding for children's programs, particularly for aboriginal children.

I have had the pleasure since February of this year to sit on the subcommittee on children and youth at risk. We have been conducting a study on the conditions of aboriginal children in Canada, both on and off reserve. I have met some exceptional people through this exercise and have heard some amazing testimony. No one spoke of any kind of government dependency, but rather of partnerships and horizontal collaborations to create an integrated policy framework for the development of young first nations children.

It is important to look at first nations children because the aboriginal population is much younger than average. Children 14 and under make up 33% of the aboriginal population in Canada, compared with only 19% in the non-aboriginal population. As well, sadly, more aboriginal children live in poverty than any other segment of the population. In fact, aboriginal people in cities were twice as likely to live in poverty as non-aboriginal people, yet little attention is given to aboriginal children living off reserve, particularly in cities, where they are most likely to be in poverty.

One of the few places that provided programs and support uniquely for aboriginal children was the native friendship centres, but this bill reduces the funding to these centres. Native friendship centres offered programs such as head start for young children and went a long way toward building a happy and healthy future for these kids. Therefore it is inexplicable in my mind as to why this funding was reduced.

When a program is working well why is money taken away from it? Why is it not added on? Why do we not learn lessons from that and create even stronger programs?

The way to deal with poverty among aboriginal children is obviously to deal with the poverty that exists within aboriginal families and families living in poverty in general. The budget has been very weak in dealing with the real needs of poor Canadians. The budget does not deal with what we need, which is a truly effective anti-poverty strategy.

What the budget does not deal with is the fact that we need a national day care strategy inspired upon the Quebec model. We could also use a national initiative to raise the minimum wages in all jurisdictions above the poverty line.

We need a national welfare standard that is above the poverty line. We also need effective strategies for ensuring full access to comprehensive disability supports. A national poverty strategy would also look at an enriched child tax benefit with assurances that all welfare families would be eligible.

We need to see the elimination of inter-provincial residency requirements and fee differentials for long term care, all health procedures, post-secondary education and other services. We need a coordinated strategy to build low income housing and end homelessness. Of course a national poverty strategy would include the realization of food security for all in Canada and a substantial reduction in the rate and depth of poverty in Canada.

I now want to say a couple of things about post-secondary education. I think everyone in the House is on the verge of attending graduations at the high schools in their ridings. Each of us will sit there very proudly watching as these young people go up to the stage with their dreams ahead of them. Many of them will go on to universities with plans to go into medicine, engineering, the arts, social work or into working with children. However their dreams depend on being able to afford post-secondary education.

The budget has been a disaster in terms of providing any real moneys for young people and for universities to actually provide affordable education. We are all seeing students in our ridings who get into university and who get a student loan only to find out after a year or two that they cannot afford to continue. Some have to work at two jobs while trying to keep up with their courses but they fall behind. Their debts are growing, their marks are falling and they are becoming overburdened by debt at the age of 19 and 20.

We are seeing a huge tragedy occur among the people who we had hoped would step into our shoes at some point and provide the energy and the idealism to make this the kind of country in which we all want to live. Our young people have found a very hard rock and an unlistening government in this budget.

I feel that the budget has been unfortunate in so many ways. It has missed the point in being able to build a stronger Canada. For persons with disabilities, for artists, for first nations children and for our students, this budget, like the ones before it, continues to ignore the realities facing all Canadians.

[Charlie Penson, Canadian Alliance, Peace River, AB]

Mr. Speaker, this is a good opportunity to rise today to speak Bill C-28, the budget implementation act. At the outset, the Canadian Alliance is very disappointed with the government in terms of its approach to the budget in this year of 2003. We believe it has taken the wrong focus and wrong approach to this budget, and there needs to be major adjustments, even at this stage, to the spending commitments it made.

This budget was brought in on February 18. It increased the amount of program spending by the federal government from $124 billion in 2002 to $150 billion in 2003, a $26 billion increase in three years. That is almost a 20% increase in spending on an annual basis, and clearly it is not sustainable. We pointed that out at the time, but it was pretty clear even back then that this was intended to be a legacy budget for the Prime Minister, and probably a leadership budget for the Minister of Finance.

What we told the Liberal Party and the people of Canada on February 18 is just all the more accentuated now because there are significant changes to the economy that would indicate the government simply has to move away from some of the budget commitments it made on February 18 in terms of the spending; spending increases that clearly cannot be maintained or sustained. The reason I say that is because we are seeing a lot of factors starting to gather. However even back on February 18 it was clear the economy was starting to slow down.

The United States economy was bumping along the bottom in terms of major changes such as the collapse of the IT sector, the information technology sector of the United States. Also the stock market had a big hit in the United States in terms of the confidence of the people who were buying stocks. By the way, that is a pretty big part of society in the United States. Almost 30% of the public own stocks and bonds. The Americans confidence was hurt by some of the scandals in the United States leading up to Enron and other matters, and it was clear the United States economy was not going to recover very quickly.

How can the Liberal Party suggest that Canada can go it alone in terms of growth in the economy if the United States is not growing or if the recovery is not underway? It was clear back then to us that could not be maintained. Now we see the Bank of Canada and other economists around the country saying that rates of growth have to be adjusted downward from those projections made by finance minister on February 18. He was talking about 3.2% growth for next year but it has already been revised down to 2.5% and may be revised down further.

We have a number of factors right here in Canada that are having a major effect on the economy. The rising Canadian dollar, or the depreciating U.S. dollar, is one of those. The 2% spread in interest rates between Canada and the United States is attracting investment in Canada and driving up the Canadian dollar. The huge current account deficit in the United States is driving down the U.S. dollar against other currencies around the world.

This should be a celebration for Canada. Canadians should be able to celebrate the fact that our dollar has appreciated. Unfortunately, past policies by the Liberal government and the other one sitting down the way, when it had its brief time in office, had a major detrimental effect to the Canadian economy. We are now only 80% as productive as the United States. Our living standards are only 70% of that of the United States. Clearly these have a big impact on us.

One would think that a rising dollar should be good news for Canadians, and it is for some people. However we are a major exporting country and as such, the cost of production in Canada has to be lower to compensate for the cost of the Canadian dollar. Clearly that is starting to have an effect on the economy. There are industries talking about layoffs as a result of it.

Over 30 years we have seen this long term decline. I do not think it was a natural decline. Back 30 years ago, and over the 100 years previous, the Canadian and the U.S. economies could be charted on an analytical basis. There are people who chart these things. Through good times and bad times, ups and downs, the graphs showed basically the same function for the two economies.

About 30 years ago that started to change and the Canadian economy started to dip. I believe it was because of public policies that were pursued by the Liberal and Conservative governments of the day that had a major impact. In fact the size of government in the United States has not changed much in 30 years, representing roughly 30% of the GDP of the country. In Canada in 30 years, those fellows across the way have grown the size of government from about 30% to 42% of GDP of the country. That takes up a pretty big chunk of the economy.

If this was all productive spending, it would not be too bad, but we know there is a lot of waste in government, particularly in this government, for things like the gun registry which has cost $1 billion and is still running. That really personifies what the problem is. The government has wasted $1 billion in the EI program. A lot of grants and subsidies have been given to the business sector, and some people would say that is a good thing.

If Canadian taxpayers wants to invest in General Electric or Bombardier, they can do that. There are stocks out there that they can buy. They should not have to do it as taxpayers of the country for something committed to by this Liberal government. Those are the kinds of things that have caused the Canadian government to rise as a percentage of GDP and a bigger take of the economy. This is part of our productivity problem.

Witness after witness appeared before the industry committee. Three major studies have been done at the industry committee about Canada's competitive position and our productivity. They have told us that we need lower taxes in Canada, probably lower than the United States, to have a competitive edge but we do not have that. The U.S. President pushed a package through Congress the other day for about $500 billion, Canadian, a further tax cut in the United States. We were already behind the United States in corporate and personal tax income rates and it is moving further. That will put us into a more uncompetitive position.

What we need is a realistic approach to this. The government has to have an economic statement recognizing the problems we have with the rising Canadian dollar. We need to recognize the slow down in the economy. We need to recognize that things like SARS and mad cow disease do have an impact on our economy. The closure of the Canada-U.S. border to imports of over $4 billion worth of beef has an impact.

The Canadian dollar rising 18% without any corresponding decrease in corporate or personal tax rates and red tape also have an impact. A canola farmer knows that instinctively. The price of canola went down from $8 a bushel to $7 a bushel just on the exchange rate. There is no corresponding decrease in the cost of production. This is hurting us and will continue to hurt us unless the government reacts by dealing with this productivity factor. The government has to lower tax rates.

I call on the government to accelerate its corporate tax cuts which are being done over five years. There are some budget measures on resource tax allowance and some things have been done on the capital tax. However they have long phase-out periods of five years. I call on the government to move quickly to bring those tax cuts in on an accelerated time schedule.

We have a problem here. The Liberal government is absolutely committed to spending. It is the old tax and spend regime. It is like the Trudeau era Liberals are back. These are the kinds of Trudeau era policies that got us into all this trouble to begin with. That government had spending rates of 6%, 8% or 10% a year. Under the current Prime Minister we are back to these rates. This year's spending alone has increased by 12% or 15%. How can that be maintained? It cannot be maintained, and it was clearly evident at the time the budget was brought down.

The Prime Minister and the finance minister buried their heads in the sand. The Prime Minister wants to do a bunch of social spending because he has to buy himself a legacy. That is a sad commentary, after 40 years in office to have to think of some way a new spending program can be invented in order to have a legacy for oneself. That in itself in my view is the legacy, and it is not a very good legacy at that.

The Liberals have put us in a very difficult position. They have a dug a hole for Canada of which it will be difficult for us to dig out. I believe we have the potential to have a far better and stronger economy than the United States. We cannot do that if we have been harnessed by bad policies over 30 years which have put us into a very uncompetitive position versus our major trading partner.

Why is it important that we compare ourselves with the United States? It is important because of the two-way trade flow and business we have between our two countries. We know that 87% of our exports go to the United States. The exports to the United States alone account for almost 40% of the GDP of Canada per year.

We have to think about what happens if we are not competitive and we lose manufacturing plants, such as DaimlerChrysler to the United States, because it is concerned about things such as border security. We know that 80% of the production of the automotive sector in Canada goes into the United States. Border security became a problem after September 11. The government clearly is not willing to talk with the United States about security issues. There is hardly a working relationship between the Prime Minister and the President of the United States.

Although, the Prime Minister finally did make a phone call yesterday after months of not wanting to talk to the President of the United States. I hear he talked about baseball. I hope he talked about things such as the Canadian border in relation to the BSE issue and about a number of other issues, such as security issues about which the Americans are clearly concerned. Like it or not, the Americans will take measures to deal with that security issue on the Canada-U.S. border. That could result in a slowdown of product crossing the border.

Two and a half years ago I was in a major steel plant. To illustrate how integrated we have become and how business works across the Canada-U.S. border, the steel rolled that day had been ordered about four months earlier. One thing I did not know is the plant makes about 200 different types of steel there. It is a very specialized business. The steel rolled that day was shipped out that very afternoon to a car manufacturing plant. It was stamped into fenders later that afternoon on a just in time delivery basis.

What does that mean? Why has the plant done that? It has done that because the cost of production has been too high. The plant had to get efficiencies into the system. The cost of carrying inventory is very high. Basically the steel plant eliminated that problem. It does not have to carry inventory any more as a result of delivering that product on a just in time delivery.

Why is that an important factor? It is important because any slowdown at the Canada-U.S. border influences that. All of a sudden if companies have to begin carrying inventory again, there is a massive cost to that. Therefore, the United States is concerned.

Companies that are thinking of new investment in Canada are concerned too because if there is a slowdown at that border and 80% of their production goes into the United States, then they might as well locate their plants in the United States.

There are a few other problems on the horizon that we have been dealing with for a while. They also have to do with a poor Canada-U.S. relationship. It is something the government has actually been very bad at. In fact I think the government enjoys tweaking the nose of Uncle Sam and sticking its finger in his eye. I am talking about duties that have been put on wheat for Canadian farmers.

I think this action is in direct response to a government that has not cooperated with the United States on a number of issues. We think the softwood lumber issue with the United States will be resolved in our favour but it has been a longstanding dispute. It costs our Canadian producers 27% duty I believe. On top of that the Canadian dollar appreciating has made it very difficult for our softwood lumber producers to compete in the United States. There have been some job layoffs.

These are the kinds of things that have to be addressed. This is the reason the government needs to come out with a new economic statement this spring. It has to recognize the realities that there is a changing situation with the economy. It has to recognize that it clearly made a wrong assessment, that the United States is not recovering as quickly as it thought it might.

United States interest rates are still only 1.25%. There is a concern about deflation in the United States and the economy is not responding very fast. So, between that and the rising dollar as a result of the depreciating U.S. currency, these are causing us a great deal of difficulty.

I call on the government to bring in a new economic statement where it would accelerate corporate tax cuts and take into account what the United States just passed through its congress, a massive tax bill of over $500 billion dollars over 10 years. Some people think that this may be picked up and continued on, and it may be a lot more than that.

We were far behind in terms of charging too much in taxes. Now the United States has moved the yardstick even further and it is clear that Canada must react. The finance minister is finally admitting that the economy will not perform as well as he suggested on February 18. If he has already made that assessment, perhaps he should come out with an economic statement that says we are prepared to make those necessary tax cuts on the personal income tax side and go further on the employment insurance rate cut so we stop overcharging Canadians.

Even this year the government is overcharging Canadians almost $3 billion in terms of excess employment insurance rates. This just goes into general revenue and as we know there is a lot of waste by the government. Day after day we hear about the ad contracts where millions and millions of dollars are being wasted.

The government and the finance minister are clearly distracted. He is running for the leadership of the Liberal Party. He is hardly ever in the House so that we can ask him a question. Clearly his focus is not where it should be. If he cannot handle the job, perhaps he should step down as finance minister and let somebody take over while he is running his leadership campaign.

We on this side have somebody we could suggest. We could clearly provide a few names for him in terms of doing that. If he is going to take his job seriously he had better come up with a new improved economic statement that would recognize the new realities of the Canadian economy and our major trading partner. We need to make the proper adjustments so that Canada can be competitive and get back on the road to improving our competitive position and productivity.

That is my challenge to the government. We want to see an economic statement this spring that would recognize all of those realities that I have just been talking about.

[Rick Borotsik, Progressive Conservative, Brandon—Souris, MB]

Madam Speaker, I knew there were questions and comments. I just did not think anyone would want to ask a question or make a comment on the speech of the hon. member for Regina—Qu'Appelle.

It is my pleasure to stand in the House and resume debate. It has been a long week, I can appreciate that. It has been a very exciting week for myself and my party with the byelection results on Monday evening. I know the weeks to come will be equally as exciting, particularly with the government trying to defend its budget when it comes to not just simply a byelection, but a general election. It is not only their budget the Liberals have to try to defend, but the mismanagement that has taken place by this government over the last 10 years.

The member for Regina—Qu'Appelle had indicated that it seemed the economy changed in 1993 when the Liberal government was elected. I know the member for Regina—Qu'Appelle would have to give credit where credit is certainly due, in that the policies that were put into place prior to 1993 were the policies that this government is now living on.

The policy of the GST, where we took the manufacturing tax off and put it on to a goods and services tax, I appreciate is not a tax that Canadians appreciate all that much. However when it was brought forward in 1993, it was with the understanding that it would be a tax that would reduce the deficit, which Liberals always talks about, the $42 billion deficit prior to 1993. It was that particular improvement which helped us find ourselves in the economy we have today.

It is the same government that will throw up its arms and say that the Tories left it with a $42 billion deficit, but it does not seem to always take the other highroad and mention the free trade agreement which was negotiated with our American friends at that time because we did have a relationship with our American friends. This is something the government does not have at this time. We were able to sit down at the table and negotiate a free trade agreement that allows us to flourish in the economy we have today.

I know the member for Regina—Qu'Appelle did not mean it when he said there were terrible economic times prior to 1993 and immediately when the government took office those economic times changed, because it did not happen that way. It certainly did not happen in this government. As a matter of fact, in spite of themselves, the Liberals have taken our initiatives and allowed themselves to balance those budgets that we would have had balanced certainly long before they did.

The budget which has been tabled today is only a reflection of what has gone on in years past with Liberal governments. It gives us the understanding of the old 1970s Liberal philosophy of spend, spend, spend. It is a legacy, and we keep hearing that word all the time, of a tired government and a tired Prime Minister telling us that they will shotgun this budget, that they will please just about everybody they have in their political pockets and that wherever the economy goes from here, it really does not matter.

We have returned to an era where the Prime Minister of the day was the previous finance minister. We have returned to an era of the Pierre Trudeau spend, spend, spend philosophy of the Liberal government. Canadians are not terribly pleased about returning to that. It is a shotgun approach.

Bill C-28 is the budget implementation bill that puts into place the budget the Liberals have tabled in the House. This is really an unfortunate happening for Canadians because the Liberals have now increased program spending in this budget alone, which means spending that was there for programs prior to the 2003-04 budget, by 7.3%. That is substantial. I do not think Canadian households have the ability to spend an additional 7.3% this year than they did last year. That 7.3% program spending increase is taking out of this budget the health care and the military expenditures, which by the way were absolutely required.

When we take out those extraordinary costs of health care and defence and the military, there is still a 7.3% increase in program spending. It is shotgun program spending, I might add. The Prime Minister probably had a dartboard somewhere in his office or maybe a putting green and he kept putting into different areas to decide which programs he was going to spend on. That is what it seems like. There was no logic to this; it was simply an ad hoc, shotgun approach to the budget.

There is a 7.3% increase in program spending. However, the finance minister of the day, who is up against that other guy from LaSalle—Émard for the leadership, says that the Liberals are going to find $1 billion somewhere in this morass of government bureaucracy that they are going to put back in that area of program spending and they are going to save $1 billion.

I will tell members how the government has saved $1 billion. It got involved in a gun registry that has cost Canadians about $1 billion over the life of that registry. It is not gun control, it is gun registry. The Liberals are going to save money in other areas to put it back into program spending, so maybe they will save money in different areas to go back into this black hole of the gun registry. From where are they going to spend some of this money? They are going to find some efficiencies in the military, the same area that Canadians and our own Auditor General have said is sadly and sorely lacking for resources.

We were supposed to put about $1 billion or $1.3 billion back into the military for this year just so it could continue in its operations. We did not. I think the military received $800 million in this budget. Not only did it get less than what was necessary as the Auditor General indicated, now it has to find $200 million in its operations to give to the finance minister to spend on the gun registry.

Taxation

[Bryon Wilfert, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, the Minister of Finance had a very productive and very useful meeting with his Quebec counterpart yesterday. It is nice to see that we can do that with the new government of Quebec.

I would point out that one of the ways the member across the way could help is to pass Bill C-28 so that needed funds to go to health care in Quebec could be passed. That member unfortunately talks on one side but does not act on the other. Let us get on with Bill C-28 to get that money to Quebec and other provinces.

Budget Implementation Act, 2003

[Reed Elley, Canadian Alliance, Nanaimo—Cowichan, BC]

Mr. Speaker, I will be splitting my time with the hon. member for Surrey North.

It is my pleasure today to rise and join in the debate on Bill C-28 regarding the 2003 budget. Before the bill was tabled in the House of Commons, Canadians, and in particular my constituents in Nanaimo—Cowichan, were hopeful that the government would actually realize what was happening in the real world outside of Parliament Hill. Canadians were hopeful that the government would begin to come to grips with the disappointment and disbelief that has arisen out of past budgets presented by the member for LaSalle—Émard.

My constituents have expressed to me, in the strongest possible terms, the conviction that the government does not even know that they exist. My riding on Vancouver Island is one of the western most ridings in this country and simply put, out of Liberal sight, out of Liberal mind. Indeed, the staff in my riding at one point had a letter from the Prime Minister's Office wanting to inquire about someone who lived on Victoria Island. Members can imagine how crushing a blow that is to our ego out there to realize that the Prime Minister's Office does not even know the right name of the island on the west coast of Canada.

My constituents were truly hoping for tax relief, but received none. Instead, they received $17.4 billion in new spending initiatives over the next three years. The simple truth is, and it is an easy truth to understand, that while the government attempts to lay claim to tax reduction, the budget says that for every one dollar in tax relief the government puts in additional $7.56 in spending. That is the new math. That is not a tax reduction budget; that is a tax and spend budget.

I would like to speak to several specific points in the bill. There is no question that tax changes for small business and the eventual elimination of the capital tax would benefit many Canadians. We have called for this for a long time. The government has paid far too little attention to the small business community in this country. This is only a feeble step in the right direction. Small business is Canada's economic backbone and has been ignored for far too long.

I am pleased with the proposed 40% reduction in the air security charge, something that the former finance minister refused to do. I eagerly wait to see if the current finance minister will actually deliver on these promises or if there is any real difference between these two members as they vie for the leadership of their party. In a country the size of Canada and the speed at which business of all sorts is conducted, air travel is absolutely imperative. The current air tax reduction of 40% is a good start, but it will continue to discourage air travel in Canada. I know and have heard from many business people in my own riding about the negative impact of the air tax. This tax should now be eliminated, not simply reduced.

The next point is child care. The Canadian Alliance believes that child care options should be given to parents, not to bureaucrats. I believe that the family is the cornerstone of society and we will prosper or collapse on the basis of that strength. We support a $3,000 per child, up to age 16, deduction for families and therefore allow them to choose the best child care option for their children and family by keeping the money in their own pockets.

With the national child benefit, Canadians once again see how the Liberals give and the Liberals take. The Liberals give the national child benefit to low income families with one hand and then tax thousands of dollars away from these very same families with the other. If the Liberals were so concerned about Canada's working poor, why would they tax them so heavily? They tax them through rising Canada pension plan premiums. They overcharge them through their employment insurance premiums as well as through low income contingent GST credits. The Liberals simply have not given working poor Canadians a fair break in the budget.

The spending on health care is another issue covered by the bill. Perhaps there is nothing that affects Canadians more than health care. Whether it is for our aging parents, our growing children or ourselves, each one of us here and across the country is impacted by health care and the costs of the system. Simply put, the money is now on the table and it is time to get on with the job of real health care reform.

When will the federal government realize that it cannot stay mired in the past? This path of health care has led to the many problems that we are currently attempting to deal with in Canada. The Liberals balanced the books largely on the backs of the provinces' own health care budgets. This was not acceptable, and it is not acceptable today. The Canadian Alliance will hold the federal and provincial governments accountable to ensure that new health spending buys real change, not simply more of the status quo.

An issue that affects all Canadians, but most notably many constituents of mine in Nanaimo--Cowichan, is the budget allocated to aboriginal affairs. Despite the billions of dollars the government has spent on aboriginal programs over the past decade, the standard of living for aboriginal Canadians remains appalling. I have visited numerous reserves, homes and sat with councils and understand this issue as well as anyone in this chamber.

I support the reallocation of departmental funding for key issues such as health, education and capital infrastructure, such as water and sewage. Let me be perfectly clear on this. I do not support the role of an increased bureaucracy. The absolutely last thing that aboriginal Canadians need is one more hurdle to jump over, one more hoop to jump through and one more piece of red tape to cut through.

Aboriginal Canadians need real assistance. Neither native nor non-native Canadians can afford to be saddled with any more administrative costs with which to deal. The number of mouldy homes, non-potable drinking water and non-existent sewage systems is simply not acceptable.

This is not a problem that has just cropped up recently. This is an issue that has been with us for years. It is an issue that existed when our present Prime Minister was the minister of Indian affairs 40 years ago, and had an opportunity then to change things and make things right. Now aboriginal Canadians are living with the failed promises and the poor attitudes that were displayed in those days. The Prime Minister of this day did not do then what had to be done to change the life of aboriginal Canadians in this country.

The Liberal government likes to talk a good story under the guise of being protectors of the environment. The Liberals have already wasted over $3 billion without a plan for Kyoto, and at this date have absolutely no results to show for it. Throwing more good money into the Kyoto cookie jar will simply lead to more waste and misuse and will not protect the environment for Canadians. The Canadian Alliance supports the need for targeted funding for new green technologies that will bring real environmental benefits to Canada. There are viable options available, yet to date this government refuses to consider them or to implement them.

An issue that is important also to many Canadians, but in particular importance to the many active and retired Canadian armed forces personnel who live in my riding, is the appalling way this Liberal government has undermined our military. This also shows up on the radar screen of a lot of polling that we do. The Canadian Alliance agrees with the Auditor General as well as many other organizations calling for an immediate increase of $2 billion per year in our defence spending. The Liberal commitment of $600 million per year falls far short of what is necessary to sustain our armed forces let alone start to rebuild it.

The examples are almost endless and they are shameful, indeed scandalous: the ill-fated replacement helicopters that have caused the death of armed forces personnel; a lack of camouflage uniforms for Afghanistan and the necessary equipment when we sent our troops into battle zones or put them into harm's way; now the government's refusal to spend any money on any heavy lift capability, expecting our allies to do the job for us; as well as underpaid personnel which leads to a deteriorating moral among our armed forces personnel. That is simply scandalous. It has to change and a Canadian Alliance government would make sure that that change takes place.

The government is making some token gestures toward tax changes. The move to increase RRSP limits to $18,000 by the year 2006, to increase the small business deduction limit to $300,000, to eliminate the capital tax over the next five years and lower the resource tax rate in line with the general corporate rate are positive moves. Unfortunately, from our point of view they are being implemented far too slowly and they fall short of what could and should be done.

I presume that my time is drawing to a close, but I would like to say that there are other issues I would love to talk about such as foreign aid, amendments to the federal-provincial fiscal arrangements, the Canada Student Financial Assistance Act, the employment insurance compassionate care benefits and of course the Liberals favourite tax, which they were going to scrap and abolish, the GST. However I do not have time to speak about all those things even though I would love to.

The bottom line however is this budget is a tax and spend budget, not unlike many budgets that have been presented in the House by previous Liberal governments. It builds on the broken promises brought in by the current Prime Minister. It builds on the boondoggles to which Canadians have been witness at HRDC and the failed gun registry.

Canadians can see through this Liberal smoke and mirrors show. They recognize that there is no significant tax relief for them in the 2003 budget. Instead the Liberal government has increased spending by 20% over the next three years. I would challenge the government to go to the people and ask if they really feel that kind of spending is in line with the priorities of Canadians. Canadians are growing weary of this, and I will continue to oppose this budget until real tax relief is available to all Canadians.

Business of the house

[Don Boudria, Liberal, Minister of State and Leader of the Government in the House of Commons]

Mr. Speaker, this afternoon we will continue with the opposition supply day motion that we commenced this morning.

Tomorrow we will resume the debate on Bill C-28, the budget implementation bill. This would be followed by Bill C-31, the pension bill of certain veterans and members of the RCMP. If and when this is completed, hopefully tomorrow, we would then resume consideration of Bill C-36, the archives bill, and possibly Bill C-17 on public safety.

Next week, as the hon. leader of the opposition in the House has stated, is a constituency week.

I have designated May 26 as an allotted day, although we are willing to have further conversations about that this afternoon.

On Tuesday, May 27, if Bill C-28 has not already been disposed of, we would at that point have to return to it. We would then turn to Bill C-25, the public service bill, followed by business not yet completed from this week.

This is the program at this juncture.

Excise Tax

[Bryon Wilfert, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, again I point out to the hon. member that the letter of December 16, 2002 clearly says, notwithstanding those decisions, that retroactive legislation would come in. We know that the courts have upheld that. Parliament has the right to do that. The member knows that. We have debated that.

The fact that the member has not won the debate has obviously not stopped him from raising the question, which is fine, but the answer remains the same. We are moving ahead with Bill C-28 and that provision is in the bill.

[Bryon Wilfert, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, the member knows very well that when the Minister of Finance on December 21, 2001 issued a press release with regard to this issue, it said that we would be bringing in legislation which we have in Bill C-28. The member also knows that the 29 cases in Quebec are not affected prior to December 21, 2001.

The solicitors for those school boards have a letter dated December 16, 2002, knowing, notwithstanding any decisions by the court, that retroactive legislation would come in. The member knows that. I have repeated it umpteen times.

[Pierre Paquette, Bloc, Joliette, QC]

Mr. Speaker, despite the Bloc Quebecois' attempts to amend Bill C-28, the budget implementation bill, the federal government is going ahead with its plan to retroactively amend the provisions of the Excise Tax Act as it relates to school bus transportation.

Can the parliamentary secretary tell us why, when his government brought in legislation regarding the transfer of family trusts abroad, it was content to legislate for the future, without retroactively reversing the decision made earlier by public servants, but in the case of school boards, it overturns court judgments in favour of the other side?

Budget Implementation Act, 2003

[Val Meredith, Canadian Alliance, South Surrey—White Rock—Langley, BC]

Mr. Speaker, thank you for the opportunity to speak on the budget implementation act, Bill C-28.

I find the dialogue we have had very interesting. The Liberal government feels it has done a really good job and we in opposition have been challenging where it has been spending Canadian tax dollars. It gets down to the original premise of what is government for and on what criteria does it collect money from taxpayers.

Basically, one has to start on the premise of should government be all encompassing and huge, or should government be as small as it possibly can be and provide the necessary services to Canadians and, therefore, have a need for less money to do that.

There have been many debates. In the House we heard another debate on what the role of the federal government should be. In Newfoundland and Labrador some people feel the federal government should no longer be controlling the fishing off the east coast because of the poor policy decisions that have been made, which have cost Newfoundlanders and Labradorians their fishing industry.

People on the west coast feel the federal government has not done an adequate job in international trade in protecting our softwood lumber industry or, for that matter, our salmon industry, our fishing industry on the west coast.

As Canadians, we have to decide what is it we expect from our federal government that we are willing to pay taxes to support. The message I hear and have heard over the last 10 years from my constituents is they expect the federal government to decrease its size, not increase its size. Canadians would like to see smaller government and getting out of their lives in a meaningful way, rather than the government growing and becoming more involved in the ordinary day to day operations of taxpayers.

It grieves me to acknowledge that what we have seen in Canada over the last 10 years is not a decrease in government size but an increase. There has been a 20% increase of senior management in the federal civil service over the last number of years. That is not decreasing the size of the federal government. That is increasing the size.

Why does the government do this? Because the federal government is getting into areas where it does not belong. It is getting into areas of providing programs for Canadians where quite honestly it should not be. Then one has to ask why is the government doing this? The government is doing this to get credit for it from the taxpayers. A more cynical person would say that the government is buying votes because often it does these sorts of things right before an election.

One of my federal Liberal colleagues asked an opposition member where he would spend the dollar if it was up to the him. That is a question the one has to address. Where are the priorities? Where does the federal government accept the responsibilities given to it constitutionally and where are its priorities?

I think Canadians are starting to feel that the priorities of the government are very misplaced. We have a gun registry that will cost upwards of a billion dollars by the year 2005. I can talk about the fuel rebate program which the Liberals introduced just prior to the 2000 election. That cost $1.2 billion. Three years later we are still paying individuals, even though it was established as an emergency fuel cost rebate.

It is those kinds of programs. It is Groupaction. It is the problems that we had with money that was not very well managed in HRDC. It is the federal Liberal philosophy I guess of bigger government, more government, more civil servants, more programs and spending more money, and that money comes from the pocket of each taxpayer.

Day in and day out I hear taxpayers saying that they want less government. They want the government to get out of their lives and let them get on with looking after themselves.

The federal government does not belong in babysitting. The federal government does not belong in some of the programs it finds itself in. I call it photo op. It wants the credit. It wants ordinary Canadians to recognize the federal government is the one that is giving them money. Ordinary Canadians will have to realize that it is their own money. It is just going from one pocket through the Liberal government back into the other pocket. This realization has to come to Canadians in order for them to understand what it is that we in the opposition are trying to bring to their attention.

A colleague across the way said that the Liberals have paid down the national debt substantially. Percentages have been used. It is like an accountant. One can use figures to support any position one wants to take. Perhaps as a percentage of the GDP it has come down, but the net debt was revised up $27 billion to $563 billion from $536 billion in last year's budget. It is not that the amount has been decreased. The amount is actually being revised upward.

We talk about priorities again and managing the money that the federal government really should have. What we have heard from Canadians recently is that they want to see the federal government recognize its responsibility for national defence. In order to accommodate defending our country and our sovereignty and fulfilling the roles that we have internationally, more money has to be designated to it. That does not mean that it taxes us more. It means that it takes money from somewhere else and puts it into defence.

The Liberal government is the one that cut health care so substantially that it put our health care system into crisis. Yes, now it is putting the money back in, but is it being managed properly and is it sufficient? Should it be putting more money into health care and taking it away from some other field, like fuel tax rebates or some of the other programs where it is questionable that the federal government should even be involved? Canadians recognize that the federal government should be involved in national defence, immigration, international trade and foreign affairs, but I think a person could argue constitutionally whether it should be involved in all the other day to day operations that Canadians find the federal government involved in.

Having said that, one has to also look at what is the role of the national government. Quite honestly I think it is to concentrate on growing the economy of Canada. Part of that is making sure that our business community is in a position of not only competing internationally but of growing its business and creating more jobs. Anyone will tell us that the more cost to businesses through taxation, through government regulations and government fees for bureaucracies that they do not want in the first place, the greater taxation that businesses pay means less money that they have for growing their operations, for creating more opportunities and creating more jobs.

There is a relationship, whether or not the government agrees or wants believe it, between high taxation and Canadian companies leaving Canada and going into the United States or other countries, China or wherever, in order to be more competitive. If the Liberals do not think that is happening, I invite them to my constituency. Daily I see businesses that can no longer compete because of the high cost of doing business, the high taxation, high land costs, again taxation through a different form of government. They simply cannot remain in business and compete with their competition in the United States, Mexico or wherever under the circumstances they find themselves operating. The government needs to recognize that there has to be a reduction in taxation in order for the business community to grow, to grow our economy, to hire more people, to provide those jobs.

It is also a question of whether or not the government knows better than ordinary Canadians what to do with their money. I would suggest that ordinary Canadians would love dearly for the government to get out of their lives and give them more tax money to spend themselves. Let them set the priorities of who looks after their kids. Let them decide in what institution they want to be educated. Let ordinary Canadians have the ability to look after themselves and their families.

It can be done. The government can reduce the taxes for ordinary Canadians and still have enough money to use on the programs deemed necessary but there is not enough money to lower taxes if the federal government is going to get into all these spending programs it has gone into. In the budget the Liberals increased their spending by 20%. The interesting thing is that taking that extra spending, 22% of it goes to major transfers to people. That would be pensions, child tax credits and that sort of thing. Some 26% was for major transfers to other levels of government. That would be health care, education, welfare transfers to the provinces. And 52% of the increase was for direct program spending.

I find it interesting that the majority of that money can go for the federal government to increase its own spending programs. I do not remember specifically, but I think defence only got a very small increase this time around. I think the infrastructure program received a small increase from what was in the first program. Where is all the money going? It is going for those photo op programs so that the federal government before the next election can say “See what we have done for you. Here is the cheque. Look how good we are. Re-elect us”.

I hope Canadians will be smart enough to realize that the money that is being passed to them is their own money. It came out of their pockets and they have to do without in order to give the government their money in order for the government to give it back to them in specific programs.

When we talk about child tax credits and all the other programs for low income individuals, why not have anyone making $18,000 or $20,000 or less not pay income tax? Why not recognize that people making that amount of money are going to have a hard enough time paying the rent and buying food that they should not have to pay taxes? Why would we take it away from them on one hand and then give them a child tax credit on the other hand? Photo op politics. The government wants recognition for being the good guy.

It is time to stop that nonsense. It is time for the federal government to look at what are its responsibilities under the Constitution. It must look at what are the priorities of Canadians. It must stop giving corporate welfare. It must stop picking one company as a favoured child and giving it billions of dollars in contracts or billions of dollars to compete against some other company that does not get any of it. How fair is that? It is time for the government to stop this nonsense. It is time for the government to pick its priorities based on what Canadians are concerned about, not about getting re-elected in the next election.

It is time for the federal government to start being a good manager of money. I sit on the public accounts committee. I cannot tell members what it is like to sit there and hear the horror stories about how things are not recorded properly, how the rules of the game that Treasury Board has established for contracting and bidding processes are not followed through on, how the administration of the tax dollars is not being done in a forthright way with good management practices.

The gun registry is only one example. We could get into how the government has transferred land and released its obligations without any protection for the taxpayer dollars that bought that land in the first place. We can talk about all the different circumstances of where contracts have been let, looking at Groupaction, where there was nothing received for the money that we paid. We are talking about $500,000 one time, the second time $500,000 with nothing to show for it and a third time it was $500,000. We are talking about $1.5 million with very little to show for it. Not only was it badly managed, but the results were not there for the money.

That is just one example. There is a bunch of them. It is frightening to see how much of the taxpayers' hard-earned dollars fritter away and cannot really be touched.

The government has decided it is going to use third party entities for some of the program delivery. I am concerned that there is not any reporting mechanism or auditing mechanism written into it. When the government set up this arm's length organization it removed the auditing function from the Auditor General. Therefore we lost control over how that money is going to be spent or whether the rules are properly followed.

The government has to start dealing with the responsibility of spending tax dollars. It is one thing to collect more money than, I would suggest, the government should be collecting. However when it does not have proper controls and cannot go to the Canadian taxpayer and say “We have looked at how this money is being used and we can in good faith say it is being managed well”, we have a real problem in our country.

Not only is the federal government spending more money than it should, it does not have a vision for the country in growing our economy, in growing the jobs and being responsible for the spending of tax dollars. It is time that the government was replaced.

A motion to adjourn the House under Standing Order 38 deemed to have been moved.

[Greg Thompson, Progressive Conservative, New Brunswick Southwest, NB]

Mr. Speaker, I always enjoy listening to the remarks of my neighbour from Palliser. He does not have to stay to listen to mine. We will not put him through that kind of agony.

I am pleased to speak to the budget implementation bill, Bill C-28. The interesting thing is that when the Minister of Finance brought down his budget in February, he was very optimistic. Things were going along pretty good. We knew there would probably be a war in the gulf, but some of the things that have happened I guess none of us could predict.

However one of the things the now finance minister did suggest about 12 months ago was that Canada was coasting in terms of its competitiveness and that we were relying solely on the weakness of the dollar to compete. He is now saying that it is fundamentally wrong and suggesting that we have to pay attention to detail because we cannot rely continually on a weak dollar to compete internationally. That is the message that we have been preaching for a number of years.

In all fairness, it is a tough message to articulate in such a way that it will be understandable and accepted by the marketplace. Given the fact that 85% of our exports go to the United States, a 62¢ dollar comes in handy from time to time.

Obviously the Minister of Finance will not comment on the dollar. An historical fact is that finance ministers seldom do. However, I think the point the finance minister, who was the minister of industry at the time, was making was that he knew we were headed for trouble with that 62¢ dollar. His argument was that if the dollar were to go up in value in relation to the American dollar that we would be in trouble because we rely solely on the weakness of the dollar to compete, that we have not addressed things like competitiveness or productivity, that we are letting productivity slide because we are again relying on a weak dollar.

He did not mention things like research and development. He paid slight attention to that. He did not mention the education or re-education of our workforce, our capital cost allowances that would allow our companies to compete on a level playing field with the Americans, and other tax treatment issues, including income tax issues.

Those words were somewhat prophetic, although the minister will not admit to that. I did put that question to the minister in his absence. It was actually answered by one of the junior ministers the other day in the House. In fact, I wanted to put that question to the finance minister today but I did not have the opportunity.

The point is that in the few short months from the February budget to today a lot of things have changed and some of those statements that the minister made a year ago are now coming back to haunt the government. An example of that was last month where we had 19,000 job losses in Canada. Now the question would be why.

We also have the SARS issue, which I guess in a sense is a budget issue as well because in dealing with that it will cost the Government of Canada and taxpayers something. However there is no question that the mishandling of that issue has cost the Canadian economy and has cost us dearly. We could argue that some of those job losses were not a result of the increased value of the Canadian dollar but were a direct result of the SARS issue, or the SARS crisis. Transportation took a heavy hit. The hospitality industry and entertainment business took a heavy hit. Therefore at the end of the day 19,000 jobs were lost. Next month's figures, May's figures, I think will tell the story as to how much of an impact this has had.

I think the dollar has also had an impact on that. As the Canadian dollar rises, our ability to ship goods to the United States diminishes because we have not addressed those productivity issues that we should have. In other words, we squandered our opportunity through those days of continued growth knowing full well that when an economy slows down we have to be prepared for the tough times. That is exactly what we are in. I think our salad days are behind us. The government has not prepared us for those tough times where we actually have to get out and compete in the marketplace on the basis of a Canadian dollar that is a little higher than 62¢.

That is something that I think the government should have addressed and did not. I would like to hear the minister's response to that when he comes back to the House.

More specifically in terms of the budget, we have to go through some of the realities that are out there today. One of the things that the government has been very good at in the 10 years that it has been in office is its management of the economy. I think the government is giving itself more credit than it deserves, because a lot of that success is based on initiatives that were taken by previous governments, which spent political capital to do what was right for the Canadian economy. One of them, of course, was the dreaded GST. I can remember when I was in the House, on the government side at the time, having the opposition accusing us of creating a cash cow. I can remember that argument very well. Of course the Minister of Finance at the time was saying that it was not going to be a cash cow but that it would noticeably increase revenue, because otherwise why would the government bring it in.

The truth is that it has been a cash cow. Some of those surpluses that have been generated simply would not be there without the GST. I guess in terms of a budgetary measure it is probably one of the best unkept promises in the history of civilization when the present Prime Minister of Canada campaigned in 1993 on a promise to rid us of that dreaded tax. The fact that he did not is probably the thing that has basically saved the government, although we will never get the Prime Minister to admit that. I think the only cabinet minister who did admit that at one particular point is no longer here with us. It was Mr. Tobin.

The other thing we spent a lot of political capital on and which has created a lot of wealth in the country is the free trade agreement. It generates about $2 billion of trade per day between Canada and the United States, and there are all the jobs that go with that.

I think those are two examples which show that when we spend political capital on issues that are controversial and obviously difficult to implement if we are doing it for the right reasons it will pay dividends down the road. They may not be political dividends, but the truth is that we will prepare the country for the future in the way it should be prepared. I think those two initiatives have worked well, better for your government, Mr. Speaker, than the one I was in. I am not going to use the word “caucus” here again which would get me into trouble with you, Mr. Speaker.

The fact is that the government has been very negligent in paying down its accumulated debt. I think it is important to recognize that the deficit has been eliminated, that is, the year to year deficit in terms of spending. In other words, the government is bringing in enough to pay the day to day bills. At the end of the day there is a surplus and the government is not adding to the accumulated debt. However, the accumulated debt that we have today is greater than what it was when the Liberal government took office in 1993.

The Liberals paid scant attention to paying down our accumulated debt. As long as that debt is there, it is taking more than money than need be out of our pockets and every Canadian paycheque to simply pay the interest on that accumulated debt, which is $507 billion as we speak. The government has paid little attention to that.

In fact, the little bit of bookkeeping magic that the Liberals have been able to generate is the huge surplus that has been accumulated in the employment insurance fund, which is approximately $45 billion. That is $45 billion that they have taken out of the hind pockets of Canadians, more than was necessary to sustain the fund. Where did that money go? It is hard to say where it went, but certainly none of it went to paying down the debt.

Let us talk about some of the areas the government has completely mismanaged. One of them is the long gun registry. The government has now spent over $1 billion on a failed registry. That would be $1,000 million. I listened to someone speak about that the other evening back in my home province of New Brunswick. He pointed out that $1,000 million divided by 10 provinces would generate $100 million in each of those 10 provinces for things like health care and education, which of course are two areas that the present government has ignored over the last number of years. In fact, when it went about balancing its books, it did it at the expense of the provinces. It was better to download on the provinces than take a look at some of its own expenditures; the government has failed to do that over the years.

I do not want to sit down without talking about defence. I just want to put some of the defence budget into perspective in terms of how much attention or lack of attention the government has devoted to this issue in terms of dollars. The defence budget in 1993-94 was $12 billion. In 1998-99 it was down to $9.4 billion. That was a reduction of 22% in five years. The current budget is 1.1% of GDP. It is the third worst in NATO, better only than Luxembourg and Iceland. The committee wanted 1.6% of GDP and a one time investment of $4 billion. It got far less than that. The money that is in the budget simply would not pay for the equipment that is needed, for example, air lift equipment and sea lift equipment. The government simply has not addressed that in its 10 years in office.

On Canadian Forces strength, let us take a look at the number of people in the military. In 1991 we had 87,600 persons. In the year 2003, that is down to 57,000. The defence committee wanted manpower up to around 60,000. The Conference of Defence Associations thought it should be up somewhere around 75,000. With the navy it is the same situation. Specifically on the navy, there are 9,000 regular forces and 4,000 reserve forces. There are 16 destroyers and 12 coastal vessels. Of those submarines that were delivered, I believe only two are serviceable. The problems are so serious with the other two that it looks like a complete waste of money by the Government of Canada.

The story goes on with other examples of mismanagement by the government and issues it did not address. One of the things the government is good at is taxing the poor. The government taxes the poor and then gives the money back to them as tax credits.

I will give an example of what we might do. We propose to stop taxing the first $12,000 for Canadians and to stop taxing the first $24,000 earned by single income families. We do not believe in taxing the poor. The fact is that a family of two earning $24,000 is not exactly rich.

These are specifically some of the things that could have been in the budget but were not, and here is a clawback example of how the government is capable of taking back money that people earn. I will step through this very specifically.

A Nova Scotia widow has four children and an income of $33,500. She works overtime, as an example, to earn an extra $1,000, for whatever reason, let us say for graduation for her son or daughter. She faces the following clawbacks in taxes; this is what would come out of that extra $1,000 this person would earn in overtime. Federal income taxes would chew up $220 of it. The clawback of the GST credit would take an extra $50 from her. The clawback of the national child benefit would be $321. The clawback of the Canada child tax benefit would be $50. The CPP and EI, net of tax credits, would be $52, and Nova Scotia tax would come in there as well, because that is a percentage of federal, in all fairness. Then there would be the clawback of the low income tax credit in Nova Scotia as well. In total, after earning $1,000 in overtime this particular person in Nova Scotia would pay back $892, with $108 to be netted by this individual. This is an example of the unfair tax treatment of individuals across the country.

I have the same example with a family of three in Manitoba with an annual income of $29,000. Again, if they worked overtime and earned an extra $1,000, after all the various taxes, some of them provincial there as well, the total of all the taxes in Manitoba would be $702. Out of that, the federal government would take $160 in federal tax. The family also would lose on the tax credit of $50 and the national child benefit clawback of $321 for a total of $702 in taxes.

When we are talking about tax reform in this place and addressing those real issues, I think there is more that the Government of Canada can do and I think it has an obligation to do that. There has to be an incentive to work. When the Government of Canada takes too much money out of our hind pockets, it simply kills that initiative. There is no reason for people to get out of bed and do it for themselves. We do reach a point where we are overtaxed and I think we have reached that point in this country. The government has had 10 years to do something about it and it has not.

One of the things we do support is the federal government's infrastructure program, which I think has been very successful in many parts of the country. In fact, we have a couple of projects in my hometowns--I am using the plural--St. Stephen and St. Andrews, about $9 million in two projects, water works and sewage projects, which are very important. We completely support them, with the help of one-third from the federal government, one-third from the provinces and one-third from those local communities.

That was an initiative by the federal government which we support, but we are not supportive of the Liberal government's past record and ability to deviate from that funding core in terms of infrastructure, where it winds up spending money on projects that have basically no merit at all. I am talking about some of what we call boutique infrastructure projects, like the famous monkey pavilions, canoe museums and NHL hockey arenas. That is just another example of how sometimes the government loses sight of why these programs are implemented in the first place.

The government has had 10 years to do it. It has had some success but the fact is there is more it can do. It is time it started to at least listen to some of the arguments that we put up on this side of the House and maybe consider some of those in its future planning.