Madam Speaker, I am pleased to speak in this final debate on Bill C-43. This has been a long journey. We started this journey back in February with the introduction of the budget on February 23, shortly thereafter, the budget implementation bill and then taking that bill all the way through the debate in the House, first reading, second reading, into committee, hearing witnesses, back out of committee and then the vote last night on report stage amendments. Now here we are on the final leg of our journey in the House with respect to Bill C-43.
The bill contains very important commitments made by the government on key social and economic issues. All of that is premised on the notion that we have sound fiscal management in the country and that we are committed, as a government, to balanced budgets. This budget represents the eighth balanced budget in a row and we anticipate, as we go forward, that we will be going into five more balanced budgets. That, in and of itself, is a historic first in this country.
However we have not always been in such an enviable situation. We will recollect back in 1993 when we came into government that the New York Times was describing Canada as an economic basket case. That was a formidable challenge for the government and it took us three or four budget cycles to actually turn the nation's finances around. We went from a situation of chronic deficits and skyrocketing public debt to a position of diminished deficits to 1997 when we actually ran our first surplus. We have been able to maintain our situation of running surpluses since then.
I think, even for all the parties opposite, we are now committed to the notion that we balance the books first and talk about what expenditures can be made after those books are balanced. I know that is a bit of a revolutionary concept for members of the Conservative Party, the NDP and the Bloc but, remarkable as it may seem, the Liberal government has been able to achieve a political consensus that balancing the books comes before everything.
We have been able to do some remarkable things in this country, one of which is the reduction in the national debt by some $60 billion over the past number of years. That has enabled us to not only achieve a triple-A credit rating, but it has also enabled us to save a significant sum of money on annual basis which is something in order of about $3.5 billion in interest costs alone.
The happy ripple effect of that is that as the Government of Canada goes, so also do other governments at both the provincial and the municipal levels but so also does business. We have at this point in our history very low interest rates. That, in some significant measure, is due to the fact that the Government of Canada has its fiscal house in order.
We have taken our debt to GDP from a historic high of 68% to now just down below 40% and the budget sets a track to go in the next number of years down to 25% of debt to GDP.
We are the only G-7 government that has been able to achieve such a remarkable turnaround and achieve such a balanced budget with surpluses going forward. We are therefore among the leading economies in the world.
That in turn, once we get the books right, allows us to contemplate investments in priorities both social and economic that Canadians have told us about over the last number of years. For those who follow these proceedings, they will know that the finance committee, for instance, conducts extensive hearings in order to be able to ascertain what the priorities are of Canadians.
The minister himself conducts a number of round tables in order to do that. There are what at least seem like endless numbers of meetings, both public and private, on what are the social and economic priorities of Canadians. I think the success of this budget and the way it has been so well received by Canadians across the country reflect the extensive hearings that we have held prebudget.
In turn, there is an expectation that the government live up to its commitments to Canadians: to Canadian families, Canadian individuals, Canadian businesses, Canadian municipalities and the provinces as well. The budget indeed lives up to some expectation on the part of Canadians that we involve ourselves to a greater extent in the affairs of the world.
If I may take a few moments, I will talk about some of these commitments and how the budget speaks to those commitments.
First, with respect to reducing the tax burden on individuals and families, members opposite will recollect that over the past five years we have had $100 billion of tax reduction initiatives, which have effectively reduced federal personal income taxes by 21% on average and by 27% for families with children.
In budget 2003, for instance, low income and modest income families received increases to the national child benefit of $185 per year for both July 2005, or in other words, next month, and July 2006. With these changes, the Canada child tax benefit program is now something in excess of $10 billion as of fiscal year 2007.
In some respects that reflects our commitment to Canadians and in particular to families raising children. That is an increase of something like 100% since 1996. As I say, members can see that this has been one of the priorities of the government once we moved into a surplus position.
Budget 2005 builds on our strong record of sustainable and responsible tax reduction by increasing the personal amount that all Canadians can earn tax free. The budget put forward in Bill C-43 proposes that we move the threshold up to $10,000 by the year 2009. As a result of that, we will take off the tax rolls something in the order of 860,000 tax filers, of whom about a quarter of a million are seniors.
Budget 2005 also tries to encourage savings. As we know, private domestic savings play a key role in our economy. We are very mindful of the demographic realities of our country. As the baby boomers age, the expectation in the not so distant number of years is that baby boomers will be drawing down on their savings, both public and private.
The government has therefore increased the limits for registered pension plans in Bill C-43 and also expects that these limits will increase further. By the year 2010, the annual dollar contribution to an RRSP will be something in the order of $22,000, with corresponding increases for registered pension plans. Thereafter, the ceilings will be indexed according to average wage growth.
We hope that by doing this we will encourage Canadians to save and assist employers in providing competitive compensation packages to attract and retain skilled workers and encourage savings to support investment, productivity and economic growth.
In addition, the budget proposed that we eliminate the foreign property rule. We did that immediately, effective the date of the budget. At one point the limitations were 20% and then ratcheted up to 30%. Now there is no ceiling on foreign property acquisition in one's RRSP. That enables Canadians to diversify their investments and creates larger pools of capital so that we can exercise those pools of capital for the benefit of all Canadians.
The budget also takes steps to improve the fairness of our tax system. It recognizes the special circumstances of certain taxpayers to reduce their ability to pay tax, so there are some initiatives to have a fair tax system and improve the quality of life for persons with disabilities. That follows the recommendations of the technical advisory committee on tax measures for persons with disabilities.
In this budget, the maximum annual child disability benefit was increased to $2,000 from a sum of $1,681, beginning next month. Bill C-43 also proposes that the maximum amount of refundable medical expenses be increased from $571 per year to $750 per year. Other measures as well, responding to the technical advisory committee, will be included in a bill that will be tabled at a later date this year.
The government is committed to ensuring that Canada's tax system is fair for Canadian businesses. It recognizes that the corporate tax system needs to be competitive in order to foster investment. In that regard, the corporate tax reductions that were originally part of Bill C-43 will be reintroduced under separate legislation. Notice has already been given to that effect.
In the budget we also respond to the concerns about tax fairness expressed by the Canadian Federation of Independent Business. There is a priority recommendation of the House of Commons Standing Committee on Finance regarding the jewellery industry in Canada. This budget proposes a phase-out of the jewellery tax, much like the finance committee recommended on two separate occasions, and it is a reflection of the regard the finance minister has for the finance committee and the work it does.
I might mention in passing that I think the finance committee made 33 recommendations. Of those, I believe 24 are all or in part reflected in the budget. The work of the finance committee is recognized in the budget and is appreciated by the minister.
The government has expressed its commitment as well to provide federal funding for our cities and communities. In 2004 we took the first steps in recognizing that by providing a new deal that allocated $7 billion over 10 years through a full GST rebate. For instance, for my community in Toronto that means a saving in the order of about $52 million on an annual basis.
Since the mid-1990s, the Government of Canada has invested something in the order of about $12 billion in infrastructure programs, leveraging more than $30 billion in total infrastructure investment over that similar period of time. We have used the Canada strategic infrastructure fund, the municipal rural infrastructure fund and the border infrastructure fund in order to be able to leverage that $30 billion over the past number of years.
As I said, the full rebate of the GST was contained in a previous budget. Budget 2005 delivers on our commitment to share the federal gas revenues with municipalities in order to address their infrastructure needs. In 2005-06 Canada's cities and communities will receive a share worth about $600 million, which is the equivalent of 1.5¢ per litre. Subsequent legislation will increase the funding gradually, until it gets to be about $2 billion annually by 2009-10 or the equivalent of 5¢ a litre of the gas tax revenue.
The Minister of State for Infrastructure and Communities has already begun negotiations with the provinces and territories to share that gas tax revenue. The money will start to flow toward environmentally sustainable projects. In Ontario this will likely mean something like $1.9 billion over the next five years. To round that off, it is about $750 million a year for Ontario in additional moneys. We think this is a good example of all three orders of government working in partnership to build sustainable communities.
Hon. members will recall the commitment made last fall to the provinces on the equalization money for the provinces and the territories, which was something in the order of $33 billion over 10 years. That being enabling legislation, that arrangement has now received royal assent and the money has in fact started to flow to both the provinces and the territories.
I should point out that this initiative represents a fundamental reform of these programs in response to the concerns of premiers and treasurers alike that their funding flows were somewhat irregular because of the nature of the funding formula. They sometimes went up and sometimes went down according to economic conditions, both in the province and out of and external to the province. The government in effect took the risk out of the funding flow, so that commitment to the provinces is something on which they can go to the bank.
The additional moneys that were provided to the provinces, both equalization receiving provinces and non-equalization receiving provinces, were something in the order of $41 billion over 10 years, the total of which--$41 billion and $33 billion--comes up to almost $75 billion in additional funding, which should in large measure stabilize the funding process for provinces as they try to meet the needs of their citizens.
Not included in this legislation, budget 2005 also announced $805 million for direct support for health initiatives, but I wanted to mention this because it further illustrates our government's commitment to continue to try to improve our health care system.
I know that hon. members opposite, two in particular, will be quite keen to see the completion of this budget because they anticipate that both Nova Scotia and Newfoundland and Labrador will be receiving significant sums of money. In the case of Nova Scotia, it is something in the order of $830 million. In the case of Newfoundland and Labrador, it is something in the order of $2 billion.
I know that those hon. members in particular will be very enthusiastic and encouraging about this receiving quick passage. Possibly they could even convince their colleagues to only make one speech at a time so that we can move directly to a third reading vote. Maybe I am anticipating the power and authority of those two hon. members to encourage their colleagues to do that.
As well, I wanted to point out that this budget provides for $120 million for a northern strategy for the three territories, Nunavut, the Northwest Territories and Yukon, and those moneys will be divided equally among those territories, at about $40 million each. That money, upon the passage of this bill, will be put into a third party trust.
As well, the budget reaches out to the world. I know that you and I share a keen interest in the Caribbean, Madam Speaker. As well, we participated in the Iraqi elections, for instance. It was their first time and it was really interesting to talk to Iraqi Canadians who voted for the first time.
We want to continue that as Canada reaches out to Haiti, Africa, the Palestinians, Afghanistan and Kosovo, and this budget enables us to do some of that. You and I were both moved, Madam Speaker, in the early part of this year with respect to Canadians' response to tsunami relief, which, after all was said and done, ended up as something in the order of $425 million. I know, Madam Speaker, that you are also keenly interested in the welfare of our Sri Lankan population and you and I were able to encourage the government to make sure that the relief was distributed in an equitable and fair way.
As well, the Asia Pacific Foundation has received funding in the amount of $50 million. It will be an endowment, which will hopefully sustain the good work the Asia Pacific Foundation is doing.
Finally, I appreciate the work of colleagues on both sides of the House. Sometimes I appreciate the work of colleagues on the other side of the House a little less, but this in large measure reflects the priorities of Canadians. We have, in large measure, delivered on the commitments made to provinces, communities and to the global community at large.
