Bill C-28 (Historical)

Budget Implementation Act, 2006, No. 2

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

Part 1 implements the following income tax measures proposed or referenced in Budget 2006:
–       the new Canada Employment Credit;
–       the new Textbook Tax Credit;
–       the new tax credit for public transit passes;
–       the new deduction for tradespeople’s tool expenses;
–       a complete exemption for scholarship income received in connection with enrolment at an institution which qualifies the student for the education tax credit;
–       the new Children’s Fitness Tax Credit;
–       a doubling, to $2,000 from $1,000, of the amount on which the pension income credit is calculated;
–       an extension of the $500,000 lifetime capital gains exemption, and various intergenerational rollovers, to fishers;
–       the new Apprenticeship Job Creation Tax Credit;
–       a reduction of the current 12 per cent small business tax rate to 11.5 per cent for 2008 and to 11 per cent thereafter;
–       an increase, to $400,000 from $300,000, of the amount that a small business can earn at the small business tax rate, effective January 1, 2007; and
–       a reduction of the minimum tax on financial institutions.
Part 2 implements the proposal in Budget 2006 to lower the income tax rate on large corporation dividends received by Canadians.
Part 3 implements the proposal in Budget 2006 to reduce excise duties for Canadian vintners and brewers.

Budget Implementation Act, 2006, No. 2

[Libby Davies, NDP, Vancouver East, BC]

Mr. Speaker, I am pleased to have a brief opportunity to address the member for Burnaby—Douglas who has given us a very good sense of what this budget means in terms of people's everyday lives.

In my riding of Vancouver East a lot of low income housing, or what we call single room occupancies, has been closed down and low income people are being evicted. Housing is being lost at an alarming rate. Just recently, a number of people in the downtown east side took over a building. Is it any wonder homelessness and destitution are growing on the streets not only in the downtown east side but in other communities across the country?

The member for Burnaby—Douglas has outlined very well the situation in his own riding with respect to the cuts made to the summer student career program and the cuts made to the literacy program. We have to ask the question: Who benefits from this budget? Who are the winners and who are the losers, especially when the cuts are stacked up against the $13 billion surplus that could have been reinvested in substantial programs that people in this country really need?

One group that gets overlooked for sure by the government are new Canadians. As the very able citizenship and immigration critic for our party, my colleague knows that new Canadians want to settle into their new communities and learn English, and yet those programs have been cut back. We have seen that in British Columbia.

I wonder if he would comment on the need for investment in these areas given the fact that we have a $13 billion surplus at the federal level.

[Bill Siksay, NDP, Burnaby—Douglas, BC]

Mr. Speaker, the issue of housing is incredibly serious. My riding adjoins the riding of Vancouver East so we are neighbours in that regard. Our housing issues are different but similar at the same time. There are a lot of specific single room occupancy issues in Vancouver East that are not an issue in a more suburban riding like Burnaby—Douglas, although there are housing issues in my riding.

We would never have considered doing a homelessness count years ago in Burnaby—Douglas. Now every year people from my community go out to find homeless people living in Burnaby and every year there are more than the year before. People are living under overpasses and in our parks. It is easy to live full time in parks in the Vancouver area. The vegetation is pretty dense in the rain forest and homeless people are not easily found in those settings. Homeless people in Burnaby--Douglas are living in terrible conditions in public parks.

Homelessness or single occupancy buildings are not the only issues. In Burnaby—Douglas the issue is also housing co-ops. Just a couple of weeks ago NDP members from the lower mainland gathered at the Norman Bethune Co-op in my riding, which is one of the buildings affected by the leaky building crisis in British Columbia. Building envelopes have failed and the water has gone through the walls and caused all kinds of structural and health issues. Mould is growing on the walls of some of these buildings.

This co-op has tried for years to receive some assistance from Canada Mortgage and Housing Corporation with no success. The former Liberal minister of housing visited that co-op. In fact, hours before he visited it, a rotting beam collapsed. He saw the damage that it caused and yet nothing came forward to help the co-op. It is now facing foreclosure on its mortgage. It has been paying an exorbitant mortgage rate.

Canada Mortgage and Housing Corporation is more about being a bank these days than being a housing development organization offering any real assistance to people. This is good housing. In Burnaby we cannot afford to lose one unit of affordable housing given the high housing crisis in British Columbia and the lower mainland let alone the 24 units that are available at the Norman Bethune Housing Co-op.

Housing is a serious issue in all of our communities and I do not see anything in this budget that will help.

[The Deputy Speaker, Bill Blaikie]

Before we resume debate, I remind members that the first five hours of debate on this bill have now expired. Speeches from here on in are 10 minutes, with a five minute question and comment period.

The hon. member forDavenport.

[Mario Silva, Liberal, Davenport, ON]

Mr. Speaker, I wish I could say that I am pleased to rise and speak to Bill C-28, but one has only to look at the content to realize that there is very little indeed to be pleased with in the first Conservative budget since the election.

Before making any comments on Bill C-28, let us go back to October 25, 1993 when the people of Canada chose the Liberal Party to form a government in the wake of nine years of Conservative rule. During those nine years we witnessed astounding short-sighted fiscal policies that left our country, one of the most prosperous in the world, with an enormous operating deficit and an ever increasing national debt.

Under the excellent stewardship of the new Liberal government that succeeded the Conservatives in 1993, we worked hard over the course of three mandates as our house was put into order. The operating deficit disappeared, the deficit was reduced, and Canadians received the services they both needed and deserved.

Imagine, upon taking office in 1993 the Government of Canada was operating with $40 billion annual deficits. Within four years the deficit was gone and Canadians had a balanced budget. The country's triple “A” credit rating was restored. The world could see what we had already come to know as a Liberal government put Canada's house in order.

I make mention of the fact that it was a Liberal government because from 1997 Canadians have to go back all the way to 1912 to find a Conservative balanced budget.

It was from this prudent fiscal management that the Liberal government was then able to move forward again with progressive policies that have made Canada the envy of the world.

In order to understand the differences in approach, we need only to look at the last Liberal budget in 2005 and the subsequent fiscal outlook also in 2005, both presented with great and deserved pride by the member for Wascana, our previous minister of finance.

What did we find in budget 2005? We found a robust economy, secure social foundations, a sustainable environment, and a sound fiscal framework. This sounds to me like the ingredients of a great fiscal policy that included responsibility, compassion for who needed our assistance, and a sound vision for the future.

In fact, the Liberal budget of 2005 recognized that the fiscal policy of the Liberal government had created the fastest rate of increase in living standards among the then G-7 countries since the budget was balanced in 1997.

What did we find in budget 2005? For one thing, we found a solid and measurable commitment to universal accessible policies and publicly funded health care for Canadians. This was not only talk, but action.

The Liberal budget of 2005 reaffirmed the government's commitment of $41.3 billion over 10 years to improve access and reduce wait times for Canadians.

This enormous commitment to health care highlighted in budget 2005 included investments in health based human resources, healthy living and chronic disease, pandemic preparedness, drug safety and environmental health.

These are the kinds of investments that we could make as a result of the sound fiscal management of the Liberal government since taking office in 1993.

Recognizing the unique challenges facing Canadians with disabilities, we changed tax policies to assist them and their caregivers.

The previous Liberal government increased the guaranteed income supplement over five years by $2.7 billion. Liberals understood the needs of senior citizens in this country and they acted.

Canadians with children also faced significant fiscal pressures and the Liberal government committed $5 billion over five years for our early learning and child care initiative.

The agreements and those being negotiated with the provinces would have created real and sustainable child care spaces. The Conservative government, of course, chose to cancel these significant steps forward and that is regrettable indeed.

In terms of the environment, the Liberal budget of 2005 included a $5 billion commitment to ensuring a sustainable environment.

The Liberal government was committed to the Kyoto accord which would have realized real and measurable action on greenhouse gas emissions. Once again, the Conservatives have chosen to join with the United States and abandon the Kyoto agreement in favour of an ineffective long term policy that has more to do with optics and political expediency than with any results on environmental protection.

What about our cities? The former Liberal government was delivering needed support to them with a share of the federal gas tax. This was a Liberal policy. It was innovative and it was welcome news in municipalities across the country. The total commitment was $5 billion over five years from gas tax revenues.

Canada has long been recognized as a leader in terms of assistance to developing countries across the world. The Liberal budget of 2005 increased our international assistance by $3.4 billion over five years. This was a sound and measurable commitment to those nations most in need.

These solid commitments, among many others, were reinstated in November 2005 when the Liberal government produced its final fiscal update. This plan outlined $2.2 billion over five years to improve financial assistance and to ensure that post-secondary education was within reach for lower and middle income Canadians.

Liberals believe that everyone deserves a chance to reach their maximum potential and that the country benefits when we all have the opportunity to achieve our goals.

There was $550 million over five years to extend Canada's access grants to all lower income students in post-secondary education. This was an incredible step forward that many students welcomed.

There were also tax benefits for low income Canadians contained in the fiscal update, as well as infrastructure commitments.

All of this was proposed while maintaining a sound fiscal footing within the context of a balanced budget. As all members of the House will know, the progressive commitments contained in the fiscal update were cast aside when members of the New Democratic Party joined with their associates, the Conservatives and the Bloc Québécois to defeat the government in late November 2005. It was an election that nobody wanted and was completely unnecessary.

Members of the New Democratic Party will certainly need to reflect on the wisdom of their action now when casting an eye on Bill C-28. Gone are the major commitments in the 2005 fiscal update. Gone are the great strides forward in child care service in the country. Gone is the Kyoto agreement. The list goes on and on.

Instead of waiting a few short months, members of the New Democratic Party joined with the Conservatives and Bloc Québécois for the purpose of political expediency to force an election. They also caused some of the most progressive policies this country has seen in years to vanish with the cold wind of Conservatism that has swept through the esteemed corners of Parliament.

I am sure many of those who have in the past supported the New Democratic Party will now be asking themselves why their party would have joined with the Conservatives in voting against the Liberal government on that November day causing all of these commitments to vanish in a single vote. I am sure they will also have much to say about what took place in the House on October 24 when members of the New Democratic Party voted with the Conservative government against a Liberal motion which stated:

That, in the opinion of the House, the government inherited the best economic and fiscal position of any incoming federal government and has not demonstrated the need, value or wisdom of its announced expenditure cuts which unfairly disadvantage the most vulnerable groups in the Canadian society.

What possibly could the members of the New Democratic Party have found so offensive about this resolution that they would once again vote with the Conservative Party? The truth is that so much has been lost to so many Canadians as evidenced in the Conservatives' first budget.

For example, where would we find in the budget the great accomplishment that was the Kelowna accord? The answer is that we do not because it is not there.

The Kelowna accord budgeted $5 billion over five years to our native people in the country. It was negotiated with provincial premiers and aboriginal leaders. The Kelowna accord was described at the time as an unprecedented step forward. I believe this to be true. I believe the decision by the Conservative government to abandon the agreement is quite frankly an unprecedented step backward.

The reality is that there is little in the budget speech for ordinary Canadians. Even those things that have been heralded by the Conservatives as significant really amount to very little.

Take the so-called tax plan for public transit users. The Minister of Finance, and indeed the Prime Minister, make much of this part of the budget. However, when actually calculating the amount, it is about $12 a month for transit users, hardly anything to really cheer about it.

Ken Georgetti of the Canadian Labour Congress described the budget this way, “The arithmetic does not work for ordinary working Canadians”. This is true because at the end of the day there is very little in the budget for ordinary Canadians.

We can only look in disbelief and regret when we glance through the budget for the financial commitments that give substance to real action on the environment file. Stephen Hazell of the Green Budget Coalition stated after the budget was announced that there is virtually nothing in the budget to make good on the government's throne speech commitments to tangible reduction in pollution and greenhouse gases. He is right because there is nothing there.

Bill C-28, the budget bill, is really a confirmation that the government is not moving forward in a manner that reflects the real values of Canadians. We have only to compare the sparse commitments in this budget to those made by the previous Liberal government, both in budget 2005 and the fiscal update, to see the reality of the Conservative government.

Canadians are compassionate, hard-working and progressive people. Budgets are statements that reflect the priorities of the government. I cannot imagine any administration in recent memory more out of touch with the people of this country.

Canadians believe in the priorities outlined in the Liberals' fiscal plans, including the environment, seniors, public transit, cities, students and persons with disabilities.

We do not find much in Bill C-28. Clearly the government is very much out of touch with the people it is supposed to be governing. I trust all members will keep this in mind when it comes to cast a vote on Bill C-28, the Conservative budget.

[Bruce Stanton, Conservative, Simcoe North, ON]

Mr. Speaker, that was an interesting history lesson as the member reflected on the months coming up to the election, not just last January and they were rather revisionary comments I must say considering the outcome that we saw earlier this year.

The member must not have taken into account the kind of tax savings that have been proposed for Canadians. The GST cut, for example, will put more than $5 billion back into the pockets of Canadians. I do not know how he might consider that that would somehow be a disservice to Canadians considering that this will be an improvement not just right across the board for all of those who buy goods and services in this country, but most important, 30% of Canadians will not even pay any income tax.

I wonder if the member might respond as to how that is somehow a disservice as I believe he described it.

[Mario Silva, Liberal, Davenport, ON]

Mr. Speaker, I welcome the opportunity to comment once again on what I see are the problems with this particular budget of the government.

The member raised the issue of the GST. He also forgot to mention the fact that the government also raised taxes for low income Canadians by half a point.

There are many things that also need to be addressed which I did not have the opportunity to address in my budget remarks. I would like to take this opportunity to address them. They are the cuts that affect the vulnerable in our society, the cuts to programs relating to literacy, students, seniors. This is increasing the social deficit in the country. There are cuts to museums and to the Law Commission.

Most important, something which was recognized internationally as very fundamental to the democratic rights of many Canadians, the court challenges program was cut by the Conservative government. It is shameful because that program has greatly enhanced not only the freedom but the equality of all Canadians. It is sad that the government could not see the wisdom of a program that has benefited so many Canadians.

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, my colleague across the way mentioned the issue of the vote the other night.

The opposition day motion put forward really was very thin soup for Canadians as not a penny was added for the people who have been hit so hard by those cuts, but it was a very rich appetizer for the Liberal soul. I think those things made a bit of a meal that we in the New Democratic Party had a hard time eating.

Parliament is here not to keep score or to deal in that fashion, but to accomplish things for Canadians. We would love to work with the Liberals, just as we would love to work with the Conservatives on accomplishing things for Canadians.

How do you think your motion would have restored any of the dollars that were lost to Canadians in those cuts?

[The Deputy Speaker, Bill Blaikie]

Just a matter of order. The hon. member should ask the member about his motion rather than using the second person. The hon. member for Davenport.

[Mario Silva, Liberal, Davenport, ON]

Mr. Speaker, I am not sure what the member found so disturbing about the motion, given the fact that the motion clearly speaks about the lack of wisdom in the government's cuts and those cuts do in fact unfairly disadvantage the most vulnerable groups of Canadians. I thought that is exactly what the problem is with the budget and the way the government is acting.

The members of his party talked about the cuts that have taken place to the volunteer programs, to literacy, to the court challenges program, to the museums and to the Law Commission. These are things that we as Liberals had fought for. We put it in the budget.

It is the present government, which was supported originally by the NDP, which is making those cuts.

I do not have to explain myself. I think it is the member and his party who have to explain to Canadians why we see so many cuts, so many aggressive policies that are taking place and why the member's party supported the government.

[Jim Peterson, Liberal, Willowdale, ON]

Mr. Speaker, I am very pleased to speak to Bill C-28.

The Conservative government is the most meanspirited retrograde government I have ever seen in the entire time that I have been in Parliament. It uses policies for politics, not for good governance. Let me give an example.

The Conservatives financed a cut in the GST by increasing income taxes. Good fiscal policy demands that there be a variety of tax sources. Most jurisdictions in the world have a consumption tax. The beauty of having a mix of taxes is that we are not victims in our fisc of economic circumstances. We can weather storms. This is the reason every single expert, economist, teacher, practitioner said that cutting the GST instead of personal income taxes was wrong.

When we cut personal income taxes, we are giving people options. They can spend the savings, as they can with the GST cut, but they can also have more money to invest and more money to save. That is why the income tax cuts that the Conservatives reversed on us were so important for the ongoing performance of our economy, to give us that money to reinvest in our capacity to compete in a global economy.

What did the Conservatives do with child care? We had meaningful child care spaces for parents in this country, as demanded by all of the groups. What did they do? They went back to something cut long ago, the baby bonus. Anyone with a child gets $100 a month. What does that do?

[Maria Minna, Liberal, Beaches—East York, ON]

That is taxed.

[Jim Peterson, Liberal, Willowdale, ON]

And that is taxed back. What does that do to help people put their kids in quality child care? Nothing. That is why every child care expert in this country has condemned the stupid politics of the Conservative government trying to pander to everybody but doing no good for any of them.

What did the Conservatives do with Kelowna? It was a historic accord reached by our government with the provinces, the territories and the leadership of all our aboriginal communities. It was historic to allow that community to develop, to grow and to have the standard of living that it is going to need. Today many of our aboriginal peoples live in such shameful conditions that we cannot hold our heads high in this country. We had to do something about our first peoples, and what did the Conservatives do? They cancelled the Kelowna accord.

Let us look at the environment. What is the single biggest problem faced by us globally according to all of the ecologists, all of the environmentalists, all of the experts? It is global warming. What has the government done with global warming? It has said that within 45 years it will reduce emissions by 45% to 65%. Does any action have to be taken today? No, it is going to continue to consult, continue to consider what measures should be taken.

We do not deal with the crisis of global warming by renouncing Kyoto. We do not deal with it by not bringing in targets. This thing has been studied to death. We know what has been accomplished in other countries in the world, in Europe.

I am not saying our record was great in Canada, but we at least had in place a program for dealing with meeting the Kyoto targets by 2012. Even our biggest detractor, the Fraser Institute, said that our green program would have gone at least 80% of the way toward meeting those Kyoto targets. The Tories have not put in place anything to start dealing immediately with greenhouse gas emissions.

Global warming is taking place at an incredible rate, 30 times what it was 20 years ago. We see the melting of the ice cap. We see the disintegration of the Larsen B Ice Shelf in the Antarctic. This is serious. There is enough ice in the Arctic ice cap and in the Antarctic--

[The Deputy Speaker, Bill Blaikie]

Order, please. I hesitate to interrupt the hon. member because I know there is quite an appetite for his words, at least on one side of the House, but it is now 5:30 p.m. and the House will now proceed to the consideration of private members' business. The member will have four minutes and forty-six seconds remaining in his time.

The House resumed from October 26 consideration of the motion that Bill C-28, A second 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.

[The Deputy Speaker, Bill Blaikie]

I believe that the hon. member for Willowdale has five minutes left in his remarks.