Bill C-52 (Historical)

Budget Implementation Act, 2007

An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007

Part 1 implements income tax measures proposed or referenced in Budget 2007 to
(a) introduce a tax on distributions from certain publicly traded income trusts and limited partnerships, effective beginning with the 2007 taxation year;
(b) reduce the general corporate income tax rate by one half of a percentage point, effective January 1, 2011;
(c) increase the age credit amount by $1,000 from $4,066 to $5,066, effective January 1, 2006;
(d) permit income splitting for pensioners, effective beginning in 2007;
(e) introduce a new child tax credit of $2,000 multiplied by the appropriate percentage for a taxation year, effective beginning in 2007;
(f) increase the spousal and other amounts to equal the basic personal amount, effective beginning in 2007;
(g) increase the age limit for maturing registered retirement savings plans, registered pension plans and deferred profit sharing plans to 71 years of age, effective beginning in 2007;
(h) expand the types of investments eligible for registered retirement savings plans and other deferred income plans, effective March 19, 2007; and
(i) increase the contribution limits for registered education savings plans and expand eligible payments for part-time studies, effective beginning in 2007.
Part 1 also amends the Canada Education Savings Act to increase the maximum annual grant payable on contributions made to a registered education savings plan after 2006.
Part 2 amends the Excise Tax Act to clarify the legislative authority that allows the Canada Revenue Agency to pay refunds of excise tax directly to end-users, where fuel subject to excise has been used in tax-exempt circumstances. It also amends that Act to repeal the excise tax on heavy vehicles and to implement the Green Levy on vehicles with fuel consumption of 13 litres or more per 100 kilometres. It also provides an authority for the Canada Revenue Agency to pay a refund of the Green Levy for vans equipped for wheelchair access.
Part 3 implements goods and services tax/harmonized sales tax (GST/HST) measures proposed or referenced in Budget 2007. It amends the Excise Tax Act to exempt midwifery services from the GST/HST and to zero-rate certain supplies of intangible personal property made to non-GST/HST registered non-residents. It also amends that Act to repeal the GST/HST Visitor Rebate Program and to implement a new Foreign Convention and Tour Incentive Program, which provides rebates of tax in respect of certain property and services used in the course of conventions held in Canada and the accommodation portion of tour packages for non-residents, and establishes new information requirements in the case where rebates are credited by the vendor.
Part 4 implements other measures relating to taxation. It amends the Customs Tariff to increase the duty-free exemption for returning Canadian residents, from $200 to $400, for absences from Canada of not less than 48 hours. It amends the Federal-Provincial Fiscal Arrangements Act to clarify that when a federal corporation listed in Schedule I to that Act pays provincial taxes or fees, wholly-owned subsidiaries of that corporation also pay provincial taxes or fees. It also authorizes the Minister of Finance to make payments totaling $400 million out of the Consolidated Revenue Fund to the Province of Ontario to assist the province in the transition to a single corporate tax administration. This last measure is consequential to the October 6, 2006 Canada-Ontario Memorandum of Agreement Concerning a Single Administration of Ontario Corporate Tax.
Part 5 enacts the Tax-back Guarantee Act, which legislates the Government’s commitment to dedicate all effective interest savings from federal debt reduction each year to ongoing personal income tax reductions. That Part also commits the Minister of Finance to report publicly at least once a year on personal income tax relief provided under the Guarantee to Canadians.
Part 6 amends the Federal-Provincial Fiscal Arrangements Act to set out the amounts of the fiscal equalization payments to the provinces and the territorial formula financing payments to the territories for the fiscal year beginning on April 1, 2007 and to provide for the method by which those amounts will be calculated for subsequent fiscal years. It also authorizes certain deductions from those amounts that would otherwise be payable under that Act. In addition, it makes consequential amendments to other Acts.
Part 6 also amends that Act to provide increased funding for the Canada Social Transfer beginning on April 1, 2007, and to provide for the method by which the Canada Social Transfer and the Canada Health Transfer amounts will be calculated for subsequent fiscal years, including per capita cash allocations. It also provides for transition protection.
Part 7 amends the Financial Administration Act to modernize Crown borrowing authorities.
Part 8 amends the Canada Mortgage and Housing Corporation Act to permit the Minister of Finance to lend money to the Canada Mortgage and Housing Corporation.
Part 9 amends the Bankruptcy and Insolvency Act, the Canada Deposit Insurance Corporation Act, the Companies’ Creditors Arrangement Act, the Payment Clearing and Settlement Act and the Winding-up and Restructuring Act to allow the Governor in Council to prescribe the meaning of “eligible financial contract”. Those Acts are also amended to provide that, after an insolvency event occurs, a party to an eligible financial contract can deal with supporting collateral in accordance with the terms of the contract despite any stay of proceedings or court order to the contrary. This Part also includes amendments to the Bankruptcy and Insolvency Act and the Winding-up and Restructuring Act to provide that collateral transactions executed in accordance with the terms of an eligible financial contract are not void only because they occurred in the prescribed pre-insolvency or winding-up period.
Part 10 authorizes payments to provinces and territories.
Part 11 authorizes payments to certain entities.
Part 12 extends the sunset provisions of financial institutions statutes by six months from April 24, 2007 to October 24, 2007.
Part 13 amends the Department of Public Works and Government Services Act to provide the Minister of Public Works and Government Services with the power to authorize another minister, to whom he or she has delegated powers under that Act, to subdelegate those powers to the chief executive of the relevant department. That Act is also amended with respect to the application of section 9 to certain departments.
Part 14 amends the Financial Consumer Agency of Canada Act to allow the Minister of Finance to provide funding to the Agency for activities related to financial education.

Budget Implementation Act, 2007

[Bill Casey, Independent, Cumberland—Colchester—Musquodoboit Valley, NS]

Mr. Speaker, I wish I could answer that but I cannot even come close because I do not understand why the Conservatives do not understand why a signed contract should be honoured.

I think every Canadian should demand of their government, whatever government it is, that if we sign a contract, if we put Canada's signature on it above the little red flag that we are all so proud of, that commitment should be honoured no matter where it is.

I do not understand. I have a theory though. I think the government wants to have uniform programs for everything. It wants to run Canada by an Excel spreadsheet. It wants everything the same. That happened with the summer job program. It wanted to do everything the same.

The problem is that we are not a uniform country. We cannot have uniform programs in this country because we are not uniform. We have so many different economic and cultural standards in the country that are different that it just does not work.

I think the Conservatives, if they want to stay in power, will need to adapt and realize that every region has different challenges and that they need programs that are designed to meet their needs. We just cannot have one program that fits all.

[Brian Murphy, Liberal, Moncton—Riverview—Dieppe, NB]

Mr. Speaker, I congratulate my friend on his words. He is virtually a neighbour of my riding and many of his constituents visit my riding and vice versa.

The economy is very strong in southern New Brunswick and in northern Nova Scotia. Communities like Truro and Amherst are economic hubs of their areas.

Could the member underscore again for the House and for the country how important it is for the pockets of prosperity in Atlantic Canada to have hope and to have economic tools that the Atlantic accord would provide for our future, for our children's future and probably, in the member's case, his grandchildren's future?

[Bill Casey, Independent, Cumberland—Colchester—Musquodoboit Valley, NS]

Mr. Speaker, I am glad the member mentioned that because my first grandchild will be born in August and her name will be Willow. We are all quite excited about it. Here is to Willow Victoria Casey.

Most economists estimate that by the government not honouring this contract, it will cost Nova Scotia about a billion dollars. That means so much in the way of economic development, future growth and not being able to build infrastructure to attract industry and investment. It will have an impact on everyone for decades and decades to come.

When this agreement was signed it was not signed as part of an equalization formula. It was signed as an economic development program. Now it is being taken away because the government made it part of equalization and removed the concept and changed it dramatically.

[Diane Ablonczy, Conservative, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, I am pleased to add a few words to this debate on what has been happening today for Canadians watching.

The government has moved a motion to ensure the budget gets through Parliament today. Canadians may be wondering what the rush is and why the government is so determined to get the budget through today. The simple answer is that if the budget does not go through today and it does not get to the Senate for it to consider and, hopefully, pass, then important spending measures would simply disappear, which is an important and undesirable consequence.

The budget was introduced on March 19. Members of this House have had three months to attack it, to rail against it or, conversely, to laud its virtues and the good things about it. There has been plenty of time for everyone, not just members of this House, but Canadians themselves to look at this budget. The budget has been out in the public domain for quite a while.

This budget should have passed the House a few days ago in order to give the Senate reasonable time to consider it, study it and make its determination on it. If this budget does not pass the House, there will be no royal assent and the budget will fail, as will the important spending measures in this budget implementation bill for Canadians.

If the spending programs are not endorsed by Parliament, by law the money will need to go toward paying down the debt. These programs, which Canadians are counting on, and a lot of my colleagues have gone through the list many times, programs for the environment, for education, for the provinces and for a whole range of good, proper and appropriate things, will not be implemented. In the next budget there will be less money to work with and there will be other priorities so these spending measures could well be lost altogether. The government cannot allow that to happen. It is, therefore, urgent that this budget pass and go over to the Senate before the Senate rises for the summer as well.

Getting the budget through is fundamental to the government's interests, and I do not think anyone would question that. I think everyone recognizes that fact. The Liberals agreed that if they could have all the witnesses they wanted at the finance committee to look at this budget, that they would not impede the budget going through the House in time to preserve these important spending programs.

However, as events unfolded, the Liberals saw an opportunity to cause grief to the government by continuing to attack the budget. I understand that is a well-nigh, irresistible opportunity for the Liberals in the official opposition so they broke the agreement to let the budget go through the House.

Here we are today and the government needs to get these measures through. This is an urgent matter. It is not something that would be nice to get through or that we would really like to get through. It must go through or these measures will be lost. Limiting debate through time allocation, which we are debating today, is the only way to save these important spending programs.

I do not understand the Liberal hypocrisy of saying that the government should not be limiting debate. There has been plenty of debate in this House on the budget. I might add that the Liberals used closure and time allocation as a matter of course when they were in government. Almost every single major government bill put forward by the Liberals had time allocation limiting debate. They pushed their legislation through. More than one-third of their measures were pushed through that way and yet they are crying foul when, on a clearly urgent matter, the government is using the only tool available to get the budget through.

The government is not doing this alone. The majority of the members in the House want the budget to go through, including members of the opposition. It is not just the big bad Conservatives doing this. The majority in the House recognize that we cannot lose these important spending programs.

The Liberals know they cannot defeat the government's budget through the front door so they are claiming they should be allowed to defeat it through the back door with these delaying tactics, but that is just not so. They said that they would not use these tactics and yet they are using them. We now need to limit debate, but not in any unreasonable or arbitrary way because there has been plenty of debate, but we need to get the budget through the House so it can go to the Senate and then Canadians can have the programs they have been counting on.

We heard a lot of hues and cries from over there because new program spending for festivals was not released two weeks after the budget came out. However, the same people who are asking us for the money are not supporting the budget. There is so much hypocrisy that it is hard sometimes to even sit still and be quiet about it.

My friend who just spoke has one interpretation of the Atlantic accords and what they should mean, but he knows there are other legitimate interpretations in the Conservative Party, among the experts who he cited and in his own province. There are legitimate differences of opinion. That is not a surprise. That is what happens in a big country with a lot of experts and people looking at many different factors. These are very complex programs.

He says that we need to find a way to resolve these differences of opinion. I agree and the government agrees that we need to find a way but how will we find a way if we close the door, walk away from the table or refuse to be part of the discussions? Sadly, that is what my friend did. I have the greatest respect for my friend but we cannot resolve differences or find a way to bring people with different opinions together if we just throw it aside and say that nothing will happen my way so I will walk away.

As the House knows, voting against the budget is a public statement of non-confidence in a government. How can someone be part of an organization in which he says publicly that he has no confidence? If I am a member of a law firm and I say that the firm is not doing a good job for its clients, does anyone think that law firm would keep employing me, paying me money and letting me be a partner when I am saying that it is not a good law firm and I do not have any confidence in it? It cannot be that way.

The member, unfortunately, is not sitting on our benches and is not part of any discussions that might be taking place in order to resolve the very differences that he says we must resolve. I might remind the Liberals opposite who say that this should not have been done and that someone who says that he or she has no confidence in the government should still be sitting on government benches, their party just a few months ago kicked somebody out who dared to give the Prime Minister of Canada some advice in an area in which he had some special expertise. He helped the Prime Minister of Canada and, therefore, was kicked out of the Liberal Party.

Another member of the Liberal Party was kicked out because there was something in the budget that his constituents had been asking for quite a while. The Liberals did not give it to them but it was in the Conservative budget and the member felt that he had to vote for it. He was kicked out.

We then had the Liberal leader saying that a member would be kicked out if he or she supported the two measures that the Liberals had put in and, even though the Liberals decided they did not like them, members had to vote the way they were told.

The fact is that we do not want anyone to be kicked out of any party. What we want is for all members of the House to realize that we are here to do a job for Canadians. If there are differences of opinion we want to resolve them in a timely and reasonable manner.

We want to get this budget through. We want to continue to work to bring people together to give them the programs they need and deserve. I urge members of the House to vote tonight for the budget and let us get on with doing the job that we are here to do, which is to help the people of this country.

[Sue Barnes, Liberal, London West, ON]

Mr. Speaker, I would like to ask my colleague in the government to verify to Canadians that it is the government House leader who sets the agenda for which bills are called before the House.

About three weeks went by after the budget was introduced when the bill never saw the light of day on the House order list. We could have been at this earlier. I just want the hon. member to confirm that it was the choice of the government in the movement of the bill. Here we are today finally with another time allocation period. I believe that if the Conservatives had wanted to do this earlier, they could have.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Mr. Speaker, it is only partly true that the House leader sets the agenda.

What has happened over and over in the House is that the opposition has called for something called a concurrence motion. The opposition has moved a concurrence motion, which automatically means that the motion is debated for three hours in the House. The opposition has done that about 20 times or more, so the House leader cannot bring forward legislation when there are impeding measures by the opposition to interrupt the business of the House in order to have these side debates on concurrence motions.

The hon. member knows that. Things get delayed and delayed, and then agreements are broken, and here we are today with an urgent matter which, I believe she knows full well, all members of the House have a responsibility for creating.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Speaker, I simply disagree with what has just been said by the parliamentary secretary. It is simply not true. The government could have put it on the order paper, but chose not to.

We had the incredible spectacle last Friday, when the government moved to make this a life and death emergency two minutes before the expiration of private members' business. It is incredible that on a Friday afternoon the Conservatives would pull such a despicable conjuring trick to try to get their budget through.

The real reason for the closure today is that we have seen reaction from across the country to the budget. We have seen the reaction to the betrayal of the Atlantic accord. We have seen the reaction everywhere, except within the Conservative caucus, to the betrayal of Saskatchewan and the Conservative members from Saskatchewan who are not speaking up for Saskatchewan.

We are seeing the reaction from British Columbians who have been betrayed on the lack of funding for flooding, the betrayal on the leaky condo promise, and the lack of action on the pine beetle

We are seeing in this budget a critical mass now of Canadians simply saying the budget is wrong. It should be rejected. That is why the government is moving to impose closure today. It is for that reason, simply because the government knows it no longer has credibility with the budget. That is the reason.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Mr. Speaker, in spite of the overheated rhetoric of my friend, and I understand he is in opposition and has to do this, he knows very well that the government has many other issues it has to deal with. We have to deal with the crime bills. We have had cries just today from the opposition saying that we have to keep criminals off the streets. These are important measures. We had democratic reform measures to reform the Senate and bring other democratic reforms forward.

We have a broad agenda, a full agenda. We give time for all of these aspects to come forward. I would say that it was the delaying tactics of the opposition that brought us to the point where the government had to use whatever measures it could to get the budget passed in time for the spending measures to go forward.

It is important that the government does all its business and manages its business, so that it is not just a one note government. There are a lot of other measures that have to be dealt with. The member knows that. To try to impede one measure and say somehow it is the government's fault just does not wash.

[Merv Tweed, Conservative, Brandon—Souris, MB]

Mr. Speaker, I know that the NDP government of the province of Manitoba has said nothing or presented nothing but accolades for the government's current budget. I do know that there is some concern from our side, the government side, that the Senate may hold this up. I would like to ask the parliamentary secretary to comment on that.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Mr. Speaker, I do not think I want to speculate on what the Senate might do. I have a high regard for the members of the Senate banking and finance committee who will be looking at the legislation. I know that they understand how urgent this is, and I can only hope and trust that they will have a little bit more responsibility than some members of the House have shown in order to get this legislation--

[The Acting Speaker, Royal Galipeau]

Resuming debate, the hon. member for London West.

[Sue Barnes, Liberal, London West, ON]

Mr. Speaker, I am pleased to participate in today's debate on Bill C-52. I believe very strongly that if the government had wished, it could have brought this bill forward earlier for debate. The record will show that during a three week period this bill could have been debated, but here we are today with time allocation on the bill.

To me, the message that this budget brings to mind, and I have been here since 1993, is that it divides so much. It has pitted province against province. It has pitted the wealthy against the poor in our society, those with children against those without children.

Governing is not just about writing cheques after a bill has been passed. Governing is about real leadership. It is about developing policies that find substance in a budget, a budget speech coming from a throne speech and that is implemented through an act of Parliament.

I do not think that Canadians want a country where people are just told to fend for themselves. There are things that a government provides, services through its programming to individuals in society. I believe and hope that all members in this House want a united and strong Canada, hopefully led by a government that will change in due course, and we can get a real commitment to meeting our country's challenges and making our lives better in this country.

I have been in my riding many times since the announcement of this budget. What do people recall about the budget? I have to say that in my constituency office, people have been coming to talk to me, and the things they talk about are issues with respect to some of the smaller museums in my riding, issues with respect to literacy cuts that happened during the course of this government.

I was at a chamber of commerce meeting once and it talked about the money that went out in this budget, the volume of dollars. I chaired the finance committee three times when we were the government and this is the highest spending budget we have had.

Yet, what do people really think that they got from this budget? It is like telling people that in the last budget they got a 1% GST cut. Who noticed it? What they really noticed is that they did not have a child care space for their child.

In this budget, there was money given to graduate students, but what about undergraduate students? Undergraduate students received nothing in this budget.

We need to be talking more about productivity. We need real productivity in all of our industries in this country because now those industries have the challenge of a rising dollar. I have heard the stories from people in the manufacturing sector to the auto sector. They have been coming in and talking about how this will affect not only them, but if they are not productive in their industries, they are going to lose their jobs in the communities. They are going to lose their lifeblood and that will change the communities that exist all across the nation. This is not a regionalized situation, but we have heard today and other days how this is upsetting people.

The finance minister talked in his budget bill about peace with the provinces. I do not think so. The headline yesterday in a national newspaper was talking about the potential of the Prime Minister suing provincial governments. I have never seen that before. That is not peace. It certainly is not equitable in transfers. Our Atlantic province members are saying that. We see the cries from the Saskatchewan province and premier as well.

I want to go back to child care because I was recently called to a meeting with my local board of education, the public board of education. There were members of all political stripes there, NDP, Conservative and Liberal. That is the makeup in the London region in southwestern Ontario. The board was trying to convince people of how necessary real child care spaces were, that people needed these in their lives. This is something that last year's budget was going to create: 125,000 new child care spaces. It is a year later and there is not one.

We used to do a budget consultation that actually listened to what people told us. I chaired that report, “People, Places and Priorities”. That financial report called on our government at the time to create the child care spaces because Canadians needed them. Families needed them. Single parents needed them.

We have a token amount again. The government is putting some money out there as an incentive for industry to create these child care spaces, but it is not in the business of child care provision. The industry is in the business of producing whatever it is it produces, but it is not child care spaces. It wants the experts and people deserve to have the experts in these organizations, people who know what they are doing.

When last year's budget hit this House, it really did hit this House. It terminated agreements that were made by ministers with all of the provinces and territories. It was a go forward because there was a real need here. That need is still there. This was an investment and there has been zero delivery.

Again, if people listened to the consultation, they would have heard that there is not going to be uptake again even though there are small amounts of money put out. It will just not work. We need children and families to be supported.

The $1,200 that last year's budget brought forward, I do not think a lot of people realized until this year's tax return time that it was taxable. So the average family had $400 out of the $1,200 taxed back. That is a new first for a child care tax. But what is lost in this shuffle is that there is now a universal benefit going out that we abolished in the past.

These were failed things where everybody got the money. We had child tax credits that went to the most deserving, the families that needed that money, not to the high income person who has money and it is not going to make the impact it would with a targeted approach.

I have been disappointed. One of the trustees sitting at that London meeting talked about how a woman who had five young children and gets the money said that it really did not go to the education and care of her children, it went to whatever the household expenses were. Even if we gave more money to the provinces in a social transfer tax, there is no agreement saying what the money is specified for like we had with the child care agreements.

There is no control over those moneys and there is a real need here. The government has to understand that there is a real need for child care and we lost it. It took a lot of work and we have lost it now.

I want to talk about how I saw this budget spend billions and billions of dollars. I believe the real reason that this was not put on the order paper immediately is because the Conservatives thought that this was a budget they would go into an election campaign and maybe there would be an election called back in March when everybody was saying there would be one. They would then not have to put through all of these high spending things that we see here because I have never seen such a calculated buying of votes that I see in this budget plan, if it can be called a real plan because a plan would be something integrated with policy.

In my riding of London West there is a billboard against the current government on the breaking of its promise on income trusts. I hope that billboard stays there a long time. It must be costly for the people, but not as costly as it was for the people who lost their money because they believed the promise of no change in the income trusts. We know that is not happening.

We have the situation of the GST promise of the last budget. People do not even notice it. Who notices that one point loss? Now we hear that the government did not even put it in this budget. Remember when the Conservatives came to power, they said they were going to do another reduction? I can remember those commercials talking about lowering the GST, well that is scheduled for 2012, a promise long in the future.

My Sister's Place is an organization that caters to the homeless and women in need. It received a couple of dollars to take it another couple of months. It seems like the Conservatives will give funding, but there is no homeless initiative or housing in this budget plan. It is just funding until the next election.

Organizations cannot run that way. They need sustainable funding whether it is child care--

[The Acting Speaker, Royal Galipeau]

Questions and comments. The hon. member for Moncton—Riverview—Dieppe.

[Brian Murphy, Liberal, Moncton—Riverview—Dieppe, NB]

Mr. Speaker, we heard from the parliamentary secretary earlier. She referred, with respect to the defection of one of the hon. members of the government side, to the analogy of a law firm. I know the member is a lawyer by trade. Has she ever heard of the firm of Dewey, Cheatem & Howe and does that apply to the firm across the way

However, more seriously, because this is a serious budget, with respect to the breach of the Atlantic accord to which the member for Cumberland—Colchester—Musquodoboit Valley has referred to as an economic development tool, not an equalization program, does she see, in her considerable legal background and experience, how the government can possibly win? Morally, how can it go to the courts, first? Second, how can it possibly win when the Government of Canada has signed an agreement with a province in Canada?

[Sue Barnes, Liberal, London West, ON]

Mr. Speaker, it is about breaking promises. The new government does not seem to have a problem breaking promises. It broke promises on the Kelowna accord. We have a bill in Parliament about the gun registry with which it has not even dealt.

The situation here, with the Atlantic accord, was a contract that was created. You have not lived up to what was signed by the Government of Canada. I hope the member, the foreign affairs minister, is looking at the current newspaper in his riding. If he were listening to his constituents in Atlantic Canada, they would be telling him that he should be living up to the accord and not changing the formula. There are changes and it has been outlined section by section by many members of the House, who have tried to advise and plea with the government.

I know another member from Atlantic Canada is considering how he will vote tonight. I hope that the members from Saskatchewan take a look at the budget with which they are trying to work.