Bill C-13 (Historical)

Budget Implementation Act, 2006

An Act to implement certain provisions of the budget tabled in Parliament on May 2, 2006

Part 1 amends the Excise Tax Act to implement, effective July 1, 2006, the reduction in the Goods and Services Tax (GST) and the federal component of the Harmonized Sales Tax (HST) from 7 to 6 per cent. It also amends the Act to provide transitional rules for determining the GST/HST rate applicable to transactions that straddle the July 1, 2006, implementation date, including transitional rebates in respect of the sale of residential complexes where transfer of ownership and possession both take place on or after July 1, 2006, pursuant to a written agreement entered into on or before May 2, 2006. The Excise Act, 2001 and the Excise Act are amended to increase the excise duties on tobacco and alcohol products to offset the impact of the GST/HST rate reduction. The Air Travellers Security Charge Act is amended to ensure that rates for domestic and transborder air travel reflect the impact of the GST/HST rate reduction. Those amendments generally apply as of July 1, 2006.
Part 2 implements income tax measures proposed or referenced in Budget 2006 to
(a) reduce personal income taxes;
(b) increase the child disability benefit;
(c) increase the refundable medical expense tax credit;
(d) eliminate capital gains tax on charitable donations of publicly-listed securities and ecologically-sensitive land;
(e) reintroduce the mineral exploration tax credit for new flow-through share agreements entered into before April 2007;
(f) expand the eligibility criteria for the disability tax credit;
(g) expand the list of expenses eligible for the disability supports deduction;
(h) expand the list of expenses eligible for the medical expenses tax credit;
(i) clarify the eligibility of home renovation and construction expenses for the medical expenses tax credit;
(j) double the amount of disability-related and medical expenses that can be claimed by a caregiver;
(k) introduce a tax credit in respect of adoption expenses;
(l) introduce a tax deferral for shareholders of agricultural co-ops;
(m) reduce corporate income taxes;
(n) eliminate the federal capital tax; and
(o) extend the carry-over period for non-capital losses and investment tax credits.
Part 3 amends Schedule I to the Excise Tax Act to repeal the excise tax on clocks, items made from semi-precious stones and items commonly known as jewellery, effective May 2, 2006.
Part 4 amends the First Nations Goods and Services Tax Act to facilitate the establishment of taxation arrangements between the government of specified provinces and interested Indian Bands situated in those specified provinces. It also amends the Yukon First Nations Self-Government Act to provide transitional income tax measures consistent with negotiated agreements.
Part 5 amends the Excise Tax Act, the Excise Act, 2001, the Air Travellers Security Charge Act and the Income Tax Act to harmonize various accounting, interest, penalty and related administrative and enforcement provisions. These amendments will apply based on an implementation date that is the later of April 1, 2007, and Royal Assent. It also amends the Excise Tax Act to confirm that debt collection services that are generally provided by collection agents to financial institutions are not financial services for GST/HST purposes and are therefore taxable for GST/HST purposes.
Part 6 enacts the Universal Child Care Benefit Act to assist families by supporting their child care choices through direct financial support to a maximum of $1,200 per year in respect of each of their children who has not attained the age of six years. It also makes consequential and related amendments to the Income Tax Act, the Employment Insurance Act, the Children’s Special Allowances Act and the Old Age Security Act.
Part 7 amends the Federal-Provincial Fiscal Arrangements Act to determine the amount of the fiscal equalization payments to the provinces and the territorial formula financing payments to each of the territories for the fiscal years beginning after March 31, 2006 and to authorize the Minister of Finance to make an additional fiscal equalization payment to British Columbia and Newfoundland and Labrador, and to make an additional territorial formula financing payment to Yukon and Nunavut, for the fiscal year beginning on April 1, 2006.
Part 8 provides for a total payment of $650,000,000 to the provinces and territories for the fiscal year 2006-2007 in respect of early learning and child care. It provides for payments to the territories for the fiscal year 2006-2007.
Part 9 authorizes the Minister of Finance to enter into an agreement to provide protection to mortgagees in respect of mortgage insurance policies that are provided by a mortgage insurer that is approved by the Superintendent of Financial Institutions to sell mortgage insurance in Canada. It also fixes the maximum amount of such protection and determines how that amount can be changed.
Part 10 extends the sunset provisions of financial institutions statutes by six months from October 24, 2006 to April 24, 2007.
Part 11 amends the Canadian Forces Superannuation Act, Public Service Superannuation Act and the Royal Canadian Mounted Police Superannuation Act to change the existing formula by which adjustments are made to a contributor’s annuity.
Part 12 enacts the Mackenzie Gas Project Impacts Act, the purpose of which is to create the Corporation for the Mitigation of Mackenzie Gas Project Impacts. The corporation will provide contributions to regional organizations that will fund projects that mitigate the existing or anticipated socio-economic impacts on communities in the Northwest Territories arising from the Mackenzie gas project. The Part also provides that a payment of $500,000,000 may be made to the corporation and adds the name of the corporation to the schedule of certain federal Acts.
Part 13 amends the European Bank for Reconstruction and Development Agreement Act to permit the European Bank for Reconstruction and Development to carry out its purpose in Mongolia and to allow the Governor in Council to amend, by order, the schedule to that Act. It amends the Freshwater Fish Marketing Act to increase the Freshwater Fish Marketing Corporation’s legislative borrowing limit from thirty million dollars to fifty million dollars. It also amends the Public Sector Pension Investment Board Act to create share capital for the Public Sector Pension Investment Board

Budget Implementation Act, 2006

[The Acting Speaker, Royal Galipeau]

Is there such agreement?

[Some hon. members]

Agreed.

No.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, when I left off in my comments about the budget I was referring to the concerns this party has and many Canadians have about the missed opportunity in child care.

I will now speak to the issues around education, particularly around those who are presently in post-secondary education and those who are looking for the promise of opportunity of post-secondary education.

In my first year of university my tuition level was $900 and the most I ever paid was $1,200. Today, sadly, students are incurring debt at an average of $25,000 to $30,000 and we hear stories of people walking out of university with student debts of $60,000 and more.

I am certainly not the oldest member of the House of Commons but neither am I the youngest, but I hesitate to believe that the intention of the government was to create more barriers for students and young people in the future.

I also want to underscore the fact that most members of Parliament who went to university or community college did not incur the kind of debt that young people are incurring now and the student debt that we will be placing on young people in the future. If we look at the student debt being incurred by young people today it is absolutely abysmal. All we have seen from the government is to give a couple of crumbs in the way of support for textbooks. Clearly, that is not enough.

This is not an ideological discussion. This is a pocketbook issue. It is an issue of parents wanting their sons or daughters to have opportunities and discovering that the opportunities for post-secondary education are not there. The opportunity is for more debt and this budget continues that legacy. It does not open up opportunities for young people.

In last spring's budget, we made some headway in making changes to provide relief for young people. The Conservative government took the money that was bookmarked for helping young people with their tuition and it put it into the capital investment for universities. I am sure everyone would agree that is an important priority because universities do need money and support for capital costs and for research and development, but when a government takes the money that was to go to young people and students and puts it into the capital investments of universities, it is on the wrong track.

In my time remaining I want to underline the fact that this was yet again a missed opportunity for the poor. I have not heard the issues of the poor and those who are most vulnerable talked about at all. In fact, what we see is that the opportunities and the supports that are being provided for in this budget will create more of a chasm between those who have and those who have not. This will be a legacy that we all have to answer for. I would hope that the government acknowledges that there will be further erosion of opportunity for those people who are the most vulnerable in our society.

[Karen Redman, Liberal, Kitchener Centre, ON]

Mr. Speaker, I am pleased to have the opportunity to speak in the House today and offer my comments on the recent budget speech.

Preparing a budget, whether it is for a household or a nation, is a delicate balancing act of many worthwhile competing priorities. As a member of the Liberal Party, I have consistently advocated for support for Canadian families while promoting fiscal responsibility in building a solid economic foundation for the future.

The Conservative government's first federal budget presented on May 2 fails to provide a sound economic vision for the future and it also brings Canada dangerously close to being back in deficit. I find the budget to be irresponsible and short-sighted and I will not support it in the House.

Let me be clear. I support affordable tax cuts. I was proud to serve in a government that instigated Canada's strong economic growth with eight consecutive balanced budgets, $61.4 billion shaved off the debt and more than $100 billion in tax cuts, which was a historic record for the country. It was through fiscal prudence and responsible spending of Liberal governments that Canada eliminated its deficit and went on to build one of the strongest economies in the world.

The Conservative government's plan to cut the GST will benefit Canada's wealthiest while leaving lower income Canadians with very little benefit. An average Canadian two-earner income family with children currently earns about $72,000 a year while 48% of Canadian families earn less than $40,000 a year. Canadians earning less than $45,000 a year would have to spend 100% of their disposable income on taxable goods and services in order to save $320. This does not include the money that families would have spent on groceries, prescription drugs, rent or tuition and education.

I cannot in good conscience support a budget where the rich get richer and the poor get poorer. Lower income families work hard. They make sacrifices to make ends meet and income tax reduction puts money in their pockets. Income tax reductions give them a chance to change their financial situation so they too can flourish as part of our Canadian economy.

Canada as a whole has the potential to flourish in the 21st century global economy but we need to invest in our people and in our brainpower. Waterloo region has become synonymous with technology, innovation and education. The technology triangle contributes to the local prosperity and to job growth.

It is a huge disappointment that the Conservative government is unwilling to partner in research and development as evidenced in its recent budget. Its budget contains virtually nothing to help Canada go forward and to put us at the front of competitiveness, knowledge and innovation.

In my region of Waterloo, we are proud to be the home of several of our country's finest post-secondary education institutions. We have a thriving research and development and technology sector. Our region has reaped the rewards of an economy that is driven by ideas, innovation and technology.

The federal government must be a partner in this growth through investments in research and development. Tomorrow's jobs can be found in today's technologies. We cannot put our nation's future prosperity at risk by abandoning these economic issues.

My constituency of Kitchener Centre has seen a significant decline in employment in the manufacturing sector. These good paying jobs are hard to replace in my riding. I implore the government to revisit its plan. I implore it to develop a strategy for investment in research and development. We are a nation of ideas. Let us support our innovators and our researchers by enabling these ideas to get to the marketplace.

All residents of southwestern Ontario are acutely aware of the challenges of climate change, extreme heat waves contributing to air pollution and smog days. These pose serious health risks to the residents of the area.

Given the reality of climate change and the profound effect it will have, not only on our lives but on the lives of future generations, Canada needs a federal government that will be willing to address the impact of climate change and what that impact will have on our health and well-being.

The Conservative government has chosen to abolish several effective climate change programs and it is set to pull out of the Kyoto accord. A responsible government would recognize climate change as the crisis it truly is and it would increase, not slash, funding to mitigate its impact. The detrimental effects of climate change are expected to increase over time. This in turn will hurt future generations of Canadians.

I cannot support a budget that does not do everything possible to ensure the health and well-being of our children and our grandchildren.

It was a proud day for me when Canada committed to the Kyoto protocol. Good climate change policy contributes to a better quality of life and better health for Canadians today and for future generations. Canadians overwhelmingly support actions to reduce greenhouse gas emissions and, at the same time, they expect all sectors of our economy, governments, industry and consumers, to be part of that process.

All Canadians got a wake-up call last summer on the quality of life of Canada's aboriginal peoples when we saw the evacuation of the Kashechewan reserve. The Liberal Party responded to that crisis with a historic landmark agreement between first ministers and aboriginal leaders in Kelowna, British Columbia. At that meeting, the government of the day committed to over $5 billion over five years to close the gap between aboriginal peoples and other Canadians in such significant areas as education, health, housing and economic opportunities.

The Conservative government has forsaken this agreement. Not only has it forsaken it but it has provided a mere $200 million to address these very important aboriginal issues.

The Conservative government has disappointed Canadians with a budget that falls short of addressing the real needs of families. It has cut programs essential to the prosperity of our country. It has canceled a national child care plan. In one year it will back away from provincial agreements that our government had forged with all provincial governments. It is cutting virtually all the funding to environmental programs like EnerGuide and REEP, programs which, from the evidence I have from groups in my riding, are effective and have not only taken greenhouse gas emissions out of the air but have saved home owners on average $750 a year.

The Conservative government has raised taxes of lower and middle income families. It truly does have a trickle down mentality, whether it comes to social programs or the economy. It intends to make the rich richer and the poor poorer. It is not ensuring that all Canadians can thrive with the prosperity that Canada now enjoys.

Canadians deserve much better than the first Conservative budget and the things that have been omitted. For all those reasons, I will not be supporting the budget.

[Jim Abbott, Conservative, Parliamentary Secretary to the Minister of Canadian Heritage]

Mr. Speaker, I must say to my friend across the aisle that I have a very high regard for her and therefore I know she says these things with sincerity, but I still have to ask this question.

When she says that we raised the taxes for lower and middle income Canadians, I wonder if she would not agree that although in fact where the Liberals had promised a particular rate, that rate had not hit that point, and that we are at a difference of one-half of one per cent on the lowest rate. I wonder if she would not take into account the $1,000 employment allowance. I wonder if she would not take into account the trades benefits that are in our plan.

I wonder if she would not take into account the $1,200 that is payable to a parent of children under six years of age, which is payable entirely without tax if that person is earning no income. In other words, taking a look at that plus the GST rollback for people who are in the lowest possible range of income, who are just barely getting by to a point of not even being able to pay tax, can she not understand that in fact they are significantly better off as a result of the Conservative budget?

My second question is with respect to Kelowna. I wonder how she feels about the fact that on the Kelowna agreement there was absolutely no discussion and no part in that agreement for 50% of the aboriginal Canadians, that 50% of aboriginal Canadians who are not on reserve, those urban people who are in an urban situation. There was absolutely no place for that. It was a very wonderfully crafted show, but it did not really have the substance. We are going to be working on the substance.

[Karen Redman, Liberal, Kitchener Centre, ON]

Mr. Speaker, I know that the member is a hard-working member of Parliament too, but I disagree. I would tell him that the Conservative budget lowers the rate of how much non-taxable money one can earn, so it has lowered the non-taxable income rate by $400 per annum. I would tell him that the 15% reduction the Liberal government had brought will go up to 15.5%. I think that is a real disservice to low income families.

I would also say that I think the $1,200 should not be paraded as a child care system at all. I am a mother of four children and I recognize how important it is for young families to have a choice. This will not create additional child care spots and that is what we hear parents want. They want to have some kind of variety.

The Liberal government introduced the national child tax benefit, which was something that helped all families with children. While the $1,200 that is given to families may be tax free if one is below the level at which one would pay income tax, the Conservative government did take away the supplementary benefit that went to the poorest of families with very young children so that they could afford formula and diapers.

So I would tell the member, no, I do not believe families are better off. I believe the government is affording families less choice. I come to this place being a clear advocate of child care, but the government ought not to dictate to families how they raise their children. By limiting the choice of young families, the government is limiting how they decide to raise their families.

As far as the Kelowna accord is concerned, I have always been very supportive of the kinds of services we need for urban aboriginals, and as a matter of fact, I have a fairly large component of urban aboriginals in my own riding of Kitchener Centre, but it should not be done at the cost of the Kelowna accord. The accord was landmark and historic because we had aboriginal leaders sitting with first ministers and the Government of Canada to work out a long term framework that would address some of the very serious concerns we see on reserves. I think it is a false dichotomy to pit urban aboriginals against on reserve aboriginals.

[Joe Comartin, NDP, Windsor—Tecumseh, ON]

Mr. Speaker, I have to say I am a bit disappointed that the last member who asked a question used up all the member's time, because I wanted to ask her a question. Perhaps we will do that some other time.

With regard to Bill C-13 and the budget, one matter stood out for me. To some degree it is a local matter, although it affects a number of communities across the country. It is a matter that was not addressed in spite of the long history of the Conservatives, and the Canadian Alliance and the Reform Party before them, in championing this issue of trying to attain some fairness and justice in the tax system. However, as soon as the Conservatives were in government, they seemed to forget about it. It is the issue of the manner in which we tax, in Canada, individual taxpayers who are receiving social security benefits from the United States.

This has been a longstanding issue. It goes back to 1996, at which point we entered into a treaty with the United States, saying that people who resided in Canada but received social security benefits from the United States would be taxed in Canada and the revenue from that would be collected in Canada. We would do the same thing with Canada pension benefits in the United States, that is, the United States would tax them, collect the revenue there and retain those funds. We had worked out a formula within the treaty, which in effect was to continue whatever the taxation rate was in those respective countries with regard to that income.

Immediately after that treaty was signed and we began to tax this in Canada, we in fact changed the formula. The way the formula worked in the United States was that because of the way money had been contributed to social security, the taxation of those revenues, that income, was to be on only 50% of the revenue.

Initially, the Liberal government--and to its eternal shame, because of some of the representations the Liberals made to the recipients of these funds--first taxed all the income, the full 100% of the income. The individual recipients began to lobby. They organized and they created associations, including a very strong one in my area of the country. They were able to get the government to move a little. Ultimately, in the 1997-98 period, the Liberals taxed on only 85% of the income. They reduced it by 15 points, but not down to what they should have, and that should have been to tax on only 50% of that revenue.

There have been a number of hearings on this, both in this chamber and in committee, and in the Senate. The groups of recipients who were opposed to this type of unfairness lobbied strongly, made representations and appeared before both houses, but they have been unsuccessful up to this point.

I wish to digress for a minute to speak about the impact this has had. One has to appreciate that for a large number of these recipients this is their total income. At the time this happened, of those who are receiving it now, for more than half of them it was their entire income. They had been living on that income. They had structured their finances accordingly. Suddenly they had this hugely increased tax burden. It was grossly unfair. They had lived their whole lives and had contributed to the social security in the United States with this program and scheme in place, which was completely legal. They planned their retirement and retired with that planning in place. Then, out of the blue, they were hit.

I have come across some horror stories. For example, one involved a member of my church, who has since passed away. Both he and his wife were receiving social security. They were still Canadian citizens. They returned to Canada and bought a house. They obtained not a large mortgage, but one they could afford with those incomes and that tax regime. When they both got hit with the increased taxation burden, they had to give up the house, something they had planned for through their entire lives. It had a devastating impact on them.

When I was campaigning in one of the elections, an elderly man told me about his brother, who had been forced to give up living independently because he had been hit the same way. For his whole life, he had planned for the way he was going to live his life. He had a small apartment and was living on his own. Because of the taxation burden he was forced to bear because of this new regime, he was forced to give up living independently in his apartment and move and share a room in his brother's house. This man said the only time his brother comes out of his room, and this had been going on for well over a year, is to come to meals and to go to the washroom. Other than that, he is embarrassed and depressed.

Those stories are repeated over and over again. The really sad part about this is that the government knows full well what is happening. There were three private members' bills put forward. On two different occasions, the Parliamentary Secretary to the Prime Minister, the member for Calgary Southeast, put private members' bills before the House that in effect would have put those people back into the position they were in at the time the treaty was signed, when the Liberal government attacked them. He was a champion for them. This was picked up more recently by the member for Essex, again, a government member. He also had a private member's bill before the House in the last session.

Both of those members lobbied the government heavily.When the Conservatives became the government of the land, when they took power, what happened is pretty simple: absolutely nothing. There were no changes. This is a simple change. It does not even require legislation. Those private members' bills are not absolutely necessary under the legal regime we have in this country. This decision can be made at the cabinet level with one meeting. The government fully understands what it is necessary to do. It knows about the unfairness. It knows about the injustice for these people.

One can only conclude that the government does not care about them, and in much the same way as the Liberal government before it, in a very cynical fashion. The government knows that the longer it draws this out, the more these individuals, who are in their later years, will pass away every year. The fight for fairness and justice keeps dwindling because they will become more elderly and there will be fewer of them. That cynicism is extremely regrettable. It does not bode well for the government or the two members who championed this, or at least allegedly championed it. We do not have the results we need, so the injustice and unfairness continue for literally thousands of people.

I want to make one final point on the subject. This is not a big ticket item. With all the tax breaks that were given in this budget, this would have been minuscule. When we look at the billions of dollars in tax breaks in this budget that went to major corporations, and international corporations in most cases, we can see that this would have been minuscule. That will continue now indefinitely. This size of tax break, which is really not a break at all but simply some justice for this group of taxpayers and citizens of this country, is a relatively small amount of money. The government is showing its inability to reflect any sense of fairness or justice for that group.

I know that my time is just about up, but I want to assure the recipients of this social security benefit that next week after the break I will be tabling a private member's bill, and this battle will continue. If the Conservative Party is not prepared to fight and get us justice and fairness, other members in the House are prepared to continue to fight for it.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Mr. Speaker, when I hear the government speak of EnerGuide and its high administration cost, I would say it is incredible, if not dubious, that it is including the assessment costs in that calculation. In fact, it would strike me that it seems to be doing this to meet a political goal. Would the member agree with that?

[Joe Comartin, NDP, Windsor—Tecumseh, ON]

Mr. Speaker, I wanted to address that point, but I got so caught up in the other issue. It is such an issue of unfairness that I became sidetracked by the passion I feel about it.

I have been a long-time environmentalist. The EnerGuide program makes good sense in terms of environmental protection and it makes good economic sense as well. When I heard the announcements I could not help but think of what the Mike Harris government in Ontario did when it first took power. His government cut the same programs in Ontario in the same kind of timeframe. I was involved with one of the environmental groups that was deploying these services in the Windsor-Essex County area. The funds were cut completely over a very short period of time.

The government is misleading Canadians. The Minister of Natural Resources has said repeatedly, and we heard it again today from the parliamentary secretary that we are only getting 50¢ of every $1 in EnerGuide to the Canadian taxpayers. That is simply wrong. The government is not taking into account the assessments and the cost of those assessments. I am sure the governing party would be the last to suggest that this work should be done on a pro bono basis. That work is absolutely crucial.

An individual is hired from the private sector to do an assessment. The individual looks at the electrical and heating sources as well as the structure of the home and then gives an overall recommendation as to how the energy efficiency of the residence could be improved. It does not need a lot of understanding; that is how the system works, but it costs money. Depending on the nature of the building, the cost runs from a minimum of $150 to $200 all the way up to $400 or $500 per assessment.

The government is saying those numbers should be on the administration side, that somehow the public service is gathering this money up. It is not at all. Every single penny of the money is in the private sector. It is going to private contractors and is benefiting the owners of the residences. The government is leading Canadians to believe that somehow they are not benefiting from it.

The next stage in the process is to make the recommended improvements. A subsidy of up to $4,500 is available. But the second stage cannot be done unless the first stage has been done.

We absolutely need to spend that money. It is going to benefit Canadians. As those assessments have been completely cut off because all of the money has been cut off, the second stage is not going to be initiated anywhere near the same level. It is all gone. The people who need that incentive are going to drop out. The impact is quite devastating.

If we are going to seriously deal with climate change problems, global warming problems, and carbon dioxide emissions, we have to do a lot of work by way of energy conservation. The only way we can conserve energy is to have this type of program, not just in residential buildings, but in commercial and industrial buildings as well. The government has completely cut the ground from under that program, and has done it in a very misleading way.

[Keith Martin, Liberal, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, it is a pleasure to speak to the budget implementation act.

I want to make a few constructive suggestions that I hope will help the government change some of its plans and focus some of its initiatives in ways that could help the Canadian public. I am sure they would receive widespread support in our House.

There are a couple of quite egregious shortcomings. One the government's move in its budgetary projections to stop the planned and successive reduction of the income tax burden on the poor and the middle class, particularly the poor. One of our primary jobs is to make sure that the least fortunate in our society are able to have as much money as possible in their pockets consistent with how much they make.

For example, someone who makes $20,000 a year is taxed about $1,800. That is not right. Eighteen hundred dollars is an awful lot of money for somebody who is making $20,000 a year. The government could have put in measures to address that. Instead it decreased the basic personal exemption, the amount of money that is tax free. It also increased the lowest tax bracket. The Liberals had reduced it to 15% from 16%. The government is going to increase it from 15% to 15.5% and then on to 16%.

Does that make sense? Is that beneficial to those who make the least amount of money? Almost every economist in the country says very clearly that this is not a wise move. The best thing to do is to make sure that people have the money in their pockets as opposed to giving the bits and pieces of so-called tax breaks which the government introduced.

For example, the $500 textbook tax break sounds good on the surface, but the question is whether it really puts $500 into the pockets of the students. The answer is no, because it is calculated by the lowest tax break. In effect they would not be receiving $500. They would be receiving 15.5% of $500, which is $155. That needs to be known. Similarly with the $1,000 tax break for working individuals, they would only receive $155 in their pockets, not $1,000.

There are some glaring omissions in the budget. Number one is health care. Health care is the number one issue for Canadians from coast to coast. With our aging population, demands on our public health care system are very high. When we were in government, the former prime minister negotiated a landmark deal with the provinces to put $42 billion into the hands of the provinces for the health care of Canadians. It is difficult to get the provinces on side collectively at any time, but we accomplished that and we put money behind it.

Money is not the entire solution, but I think all Canadians and indeed members of this House were clearly looking for some leadership and solutions on the part of the government on the most important issue affecting Canadians. Did we see it? We did not. The government needs to take leadership. It is more than money. There are other areas that can be worked on in health care.

For example, why not bring together the provincial ministers of education and work to ensure that physical activity for children is part of the school curriculum from kindergarten right to grade 11 or 12? It is critically important to address the epidemic of childhood obesity, which we believe is going to shorten the lifespan of a generation of children. For the first time the longevity of Canadians will actually decline, we think as a result of the epidemic of childhood obesity.

Another way would be through the head start program. From Montreal, Quebec to Ypsilanti, Michigan the Y's head start program has had a good impact. There is also the work that our former MP, Claudette Bradshaw, did with respect to the head start program in Moncton, New Brunswick. That program should be integrated into an early learning program across the country. It strengthens the parent-child bond and has proven to have a profound impact upon an array of social issues, challenges such as teen pregnancies and youth crimes, issues that concern all of us.

There was a 50% to 60% reduction in youth crime with the introduction of a head start program for kids. The program works with parents and children to provide parents with good parenting skills and provide children with some basic knowledge in life skills. The savings are $7 for every $1 invested. A 25 year retrospective analysis was done on these programs around the world and the findings are consistent around the world. They will actually affect the very social challenges the government and indeed we in opposition are concerned about. They are pragmatic, affordable and doable. I urge the government to proceed in that way.

Turning to national defence, when we were in government we committed $13.7 billion over five years for our defence forces. All of us applaud and thank from the bottom of our hearts the hard work that has been done by the Canadian Forces not only here at home but also in Afghanistan. We thank them profoundly for what they are doing for us.

The Conservative government put in $1.1 billion over two years and $5 billion over five. That is a stark difference from the $13.7 billion that we committed over five years. Indeed in my one year as parliamentary secretary, our commitment over and beyond the base budget actually went to $1.1 billion for one year. I would ask the government to look at a more significant investment in the Canadian Forces.

I did not have a chance to speak during the recent debate on Afghanistan. I said to the government prior to that debate that we needed more than 36 hours' notice to make a decision on that which is arguably the most difficult and important decision any of us has to make, which concerns putting the lives of our troops in harm's way. We needed more than 36 hours, not because we are opposed to the mission, not because we do not support our troops, but because it is our moral responsibility to ask the questions that the troops and the Canadian public cannot ask on the mission's two year extension.

A case in point was that 12 hours after we heard that there was going to be a debate for six hours and then a vote, on the front page of the Globe and Mail there was a statement that NATO had requested that Canada take on the entire mission in Afghanistan. That is a very significant piece of information. We did not know about that until we read it in the Globe and Mail.

I said to the government that we needed a couple of weeks, not a long time, to get the information and briefings from national defence, foreign affairs and CIDA. We wanted to know the facts, to make sure that the conditions were there for the success of the mission for our troops. That is our responsibility. I would like answers to some questions.

First, in order for the success of our troops in Kandahar, the civil-military cooperation component, the CIMIC component, has to be there and completely funded. What are the plans for the CIMIC component? What moneys have been put into Kandahar? When I asked the Minister of International Cooperation she could not give me an answer.

The success of the CIMIC component is intimately entwined with the success of the mission. If I were a Canadian Forces member on the ground in Kandahar working my butt off in the interests of our country, putting my life on the line as they are doing for our country, I would want to make sure that the CIMIC component was there and fully funded. It is absolutely essential for the bottom line security conditions that are needed on the ground.

Second, how is the training going for the domestic security forces, the Afghan police and the army? Our exit strategy is predicated on the ability of the Afghan security forces to retain control over a reasonable part of their country so that the Taliban and al-Qaeda cannot take root again. That is the domestic interest in our being there. That is the end goal. I do not know how far we have got, but I simply want to have answers to those questions from the department officials.

I have run out of time and I have a list of questions. They are questions based on fact. They are not political but they are questions that I feel it is my responsibility to ask and to get answers to.

I support our troops, as do the vast majority of members in the House. The members of my party firmly support our troops, but we want to receive the answers to our questions that are critically important for us to be able to look CF family members in the eye and answer their questions directly.

It is a real shame the government did not take it upon itself to give us that opportunity to have those questions answered and execute our responsibilities and duties in a fair and fulsome manner.

[Jay Hill, Conservative, Prince George—Peace River, BC]

Mr. Speaker, I have a comment and a question for my colleague from Esquimalt--Juan de Fuca.

People who have followed both his career and my career know that we used to be in the same party a few years ago. He started out as a Reformer in the Reform Party, became a member of the Canadian Alliance and then, ultimately, made the decision to cross the floor and become a Liberal and sit with the Liberal Party. Then he ultimately rose through the ranks of the Liberal Party to be the parliamentary secretary.

I have heard and even have a very sympathetic ear to his quest to try to produce a head start program for children, parents and families. He has been championing this for years. I can remember conversations he and I had back in the early days of the Reform Party of Canada. He crossed the floor so he could be more influential with the Liberal Party, when it was the government, yet he was completely ineffective in getting the program going.

Upon reflection, when he looks at the choice that he made, does he still believe he made the right choice, considering that he is still talking about this worthwhile program but it has never happened?

[Keith Martin, Liberal, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, I appreciate the comment from the government whip. We share a lot of interests in this issue. I appreciate the conversations that we had in the past on this. I look forward to the government, with his influence, implementing such a program.

I did not leave my former party to be more effective. My former party left me.

I will give the hon. member some examples of that because he came from the same roots as I did, reform. I can ask him some rhetorical questions. How can tolerate the cluttering of our tax system and the increases in taxes to the poor? How can he tolerate the undemocratic ways of his government, the muzzling of his ministers, the muzzling of his MPs and the thin legislative agenda on five points? Given his reform roots, surely he cannot condone the undemocratic measures which his government is putting in. Quite frankly, true Reformers would be rolling over in their graves to know what the current Conservative government is doing, which is not the Reform Party of old. In fact, it is violating some very basic principles on democratic reform, which the members who voted for the Conservative Party would find egregious.

On the head start program, we had an early learning child care program. The early learning program was not simply a place for children to be put in a room for six hours to eights a day. It was a place where children would get quality early learning, where a lot of the influences would occur and where parents would be involved.

As the member probably knows, because we come from the same province, the early learning program put forward by the former minister was an individual program per province. Flexibility was built into the program for every province. I spoke to our provincial counterparts in British Columbia and that was the quid pro quo for our success in signing on so many provinces. The early learning program we had was not simply a day care program; it did involve an early learning component.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Mr. Speaker, I am pleased to have the opportunity to rise today to speak Bill C-13, the budget implementation act. The bill intends to provide the legislative framework for the budget that was introduced on May 10 to many cheers from this side of the House, but far fewer down at this end.

Ultimately, it cannot be said enough that this is a budget of missed opportunity. After more than 12 years of broken promises from the Liberal government, this was an opportunity to reinvest in the priorities of Canadians. The only real multi-year plan in the budget is for corporate tax cuts. There is no multi-year commitment to child care, education, training or the environment.

The Liberals hid their broken promises behind claims of huge deficits long after the deficit was under control. The Conservatives are now ignoring the $8 billion surplus expected this year, not to mention the $83 billion surplus expected over the next five years.

These surpluses represent a massive fiscal capacity, a capacity to invest, an opportunity to invest. Instead the Prime Minister and the other members of the House chose to squander over $7 billion in corporate tax cuts.

While we pay record prices at gas pumps as prices continually spike, the Conservatives chose to keep the subsidies to oil and gas companies. The people of my riding know that this is a budget of missed opportunity. My constituents see the loss of federal funding for the best start program, which raised hope and expectation for the people of my community that affordable, accessible, child care would soon be available.

At the same time, as less affordable accessible child care spaces are available, working families will see the elimination of the young child supplement and will see the promised $100 per month taxed down to very few real dollars. They see no real money to fight for the environment such as the Hamilton harbour after decades of industrial pollution.

For Stelco and Dofasco workers, who have been through months and years of uncertainty, there are no changes to EI and no new retraining efforts that will help them as the industry continues restructuring and changing to meet the new challenges.

For students at McMaster University and the parents and families who support our youth getting a post-secondary education, the budget does not propose affordability. The Conservative's solution for the post-secondary crisis is an increased opportunity to acquire debt for education, but no investment to lower tuition fees or introduce grants.

Instead of the steps outlined in Bill C-13, we should be seeing a plan for child care that invests in children and their families. Seventy per cent of children under the age of six have a mother who is in the workplace. There are only enough regulated child care spaces for 15.5% of these children.

In my riding of Hamilton East—Stoney Creek, the best start demo project area would have reached out to over 3,000 children and their families. Cancelling the child care agreements with the provinces amounts to a grab back of $3.6 billion in investment in our communities. Between 2005 and 2008, this was to represent an investment of over $93 million in our province alone.

What does the Conservative government budget cost the families of Ontario? It costs $30 million every year, $30 million that could have created spaces that are desperately needed, $30 million that would have been well spent on a partnership with the parents of Ontario's children.

Health care is the number one priority of Canadians, including the people of my community. It has been completely ignored. In the bill there is no investment to start a national pharmacare program, even though in a few short months our first ministers on health are expected to report back on the issue. In a recent series of mailings to my community, a large number of constituents wrote back to me asking for a national pharmacare program.

The House resumed consideration of the motion that Bill C-13, An Act to implement certain provisions of the budget tabled in Parliament on May 2, 2006, be read the second time and referred to a committee, and of the motion that the question be now put.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Mr. Speaker, I thank the hon. member for the apology.

Drug costs have doubled since 1985 and, after hospitals, are the second biggest category of health related costs in our country.

Almost four years ago, Roy Romanow in his commission recommended catastrophic drug coverage as a start. Not only does Bill C-13 not make preparations for pharmacare generally, the government cannot even act on a four year old recommendation for catastrophic drug coverage.

In the budget there is no funding for home care, something many seniors and their families rely upon. There is no funding for the training of health professionals so that people at the Henderson, St. Josephs' and General Hospitals in Hamilton do not have to wait as long to see a doctor.

The Conservative government could also have taken the opportunity to introduce measures to adjust seniors' pensions to help those seniors who have expressed concern to me about having to decide what to buy: hydro or food. However the government did not take that opportunity to invest.

For the many seniors living on fixed incomes and in poverty in my community and across Canada, a 1% GST tax cut or an income tax cut that only applies to a higher tax bracket means very little. It likely will not even cover the increase in home heating oil or hydro costs this year.

Not only will oil and gas companies get big tax cuts, they also continue to get the estimated $1.4 billion in subsidies; $1.4 billion for gas companies, but only $500 million in the budget to fight pollution. That is the same amount that the NDP put in its budget last year for low income housing energy retrofits, money for people with lower incomes to do renovations that would help green their homes, help them fight pollution and do their part.

The budget cancels that NDP investment. The budget not only does not fight pollution, it is taking away the help the NDP wanted to provide to low income families for retrofit.

By opting out of Kyoto, the Conservatives think they can do better than the years of consensus building in the international community. They will make their own plan but they do not have a plan yet. It is not in the bill we are debating today. The government tells us that it is under development. Canadians have heard that story before. The Liberals promised a Kyoto plan for years. When they finally did introduce something, it did not even try to meet targets set at Kyoto in all areas.

The budget means pollution will go up. Just like the Liberals, the government has no plan to invest in what we need to do to cut greenhouse gas emissions and reduce pollution.

We often hear governments, businesses and people talking about economic innovation, greening the economy or products. We do not have to be political scientists to know that the world is changing around us, and with those changes, particularly in the economic arena, come many new challenges. However it is worth stating that with those new challenges, challenges like those faced by steelworkers in my riding and people working in manufacturing industries across the country, come new opportunities.

Manufacturing as a sector was mentioned at least 10 times in the preamble of the budget when it was presented in the House, mentioned because of the huge losses expected in the sector. Yet, in the Conservative budget plan, the only mention of the manufacturing sector is that it will be getting some of the proposed corporate income tax cuts that we see presented here in the bill.

If we can get in on the ground floor, we can become world leaders in these technologies, manufacturing processes and knowledge.

The Conservative budget does nothing for the manufacturing sector, even though the dollar is now hovering around the 90¢ mark.

However, these changes do not just happen overnight. We need more training and retraining opportunities. Training is the clearest example of how we can invest in working families to improve real life opportunities and to boost our dropping productivity rate. While there are some positive changes for training here in the bill, they are very limited and specific to apprentices and a small tax credit for trades people who buy their own tools. There is nothing for training and immigrant settlement programs even while more and more people are facing underemployment and lower paying jobs.

Instead of a vision for an integrated training role in the 21st century and a strategy to get us there, the Conservative budget gave us a few ad hoc fragments but no strategy.

The budget also did not broaden the EI program. Even though all workers pay into EI, fewer than 40% of them qualify for support. The greatest percentage of those who do not qualify are women who are most often in the part time, lowest paying and least secure jobs.

In the 1990s, 75% of workers qualified for EI benefits. Now, only 38% of workers qualify for EI. This bill, this Conservative budget, does not change eligibility requirements or benefits, which is another lost opportunity.

I was pleased, however, to second a bill that was proposed to make some changes in the EI program. It was put forward by my colleague from Acadie—Bathurst a few weeks ago in the House and I commend him on his work in this area.

Bill C-265 would modify the employment insurance program so that benefits can be calculated on the basis of the best 12 out of 52 weeks. The private member's bill will also see the eligibility requirement at 360 hours for all benefit recipients in Canada. With a $49 billion surplus in this program, it is long past the time for these changes.

This bill is equally disappointing when we look at post-secondary education. Instead of keeping the tuition lowering oriented funding of the NDP budget at $1 billion, this bill proposes to convert that funding into one time education infrastructure funding. When four out of ten university students are unable to graduate on time because they dropped courses to work, we all lose. When 70% of high school graduates want to go to college but cannot, and list finances as the main reason for not getting a further education, we are all losing. We are losing out on the increased contributions that these graduates could be providing communities like my home town of Hamilton and others across the country.

This Conservative budget does nothing to address the most pressing financial issue related to students: the need to reduce debt loads. This budget does provide a few positive changes, such as removing the income tax on bursaries and scholarships and textbook credits. If the government will not invest when it has billions in surplus and corporations are not reinvesting the breaks they get through tax cuts and subsidies, who will invest?

That is why I stand with my NDP colleagues in opposition to this budget. It is a lost opportunity to invest and I do not believe it reflects what Canadians have asked us all to do in the House.