Budget Implementation Act, 2007

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

This bill was last introduced in the 39th Parliament, 1st Session, which ended in October 2007.


Jim Flaherty  Conservative


This bill has received Royal Assent and is now law.


This is from the published bill. The Library of Parliament often publishes better independent summaries.

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.


All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.


June 12, 2007 Passed That the Bill be now read a third time and do pass.
June 12, 2007 Passed That this question be now put.
June 12, 2007 Passed That, in relation to Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, not more than one further sitting day shall be allotted to the consideration of the third reading stage of the Bill; and That, 15 minutes before the expiry of the time provided for Government Business on the day allotted to the consideration of the third reading stage of the said Bill, any proceedings before the House shall be interrupted, if required for the purpose of this Order, and, in turn, every question necessary for the disposal of the said stage of the Bill shall be put forthwith and successively, without further debate or amendment.
June 5, 2007 Passed That Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, as amended, be concurred in at report stage with further amendments.
June 5, 2007 Passed That Bill C-52 be amended by deleting Clause 45.
May 15, 2007 Passed That the Bill be now read a second time and referred to the Standing Committee on Finance.
May 15, 2007 Passed That the question be now put.

Royal Recommendation--Bill C-290Points of OrderRoutine Proceedings

June 18th, 2009 / 10:40 a.m.
See context

Regina—Lumsden—Lake Centre Saskatchewan


Tom Lukiwski ConservativeParliamentary Secretary to the Leader of the Government in the House of Commons

Mr. Speaker, I rise on a point of order.

On June 9, 2009 you made a statement with respect to the management of private members' business and noted the spending provision in three private members' bills appeared to infringe on the financial prerogative of the crown. At that time you invited members to make arguments on whether these bills required a royal recommendation.

One of the bills is Bill C-290, An Act to amend the Income Tax Act (tax credit for loss of retirement income), which will be debated later today. Notwithstanding the possible merits of Bill C-290, the bill would create a new refundable tax credit for the loss of retirement income, and I believe it would require a royal recommendation.

Refundable credits are direct benefits paid to individuals regardless of whether tax is owed or not and are paid out of the consolidated revenue fund, also known as the CRF. As a result, any legislative proposal to create a refundable tax credit requires a royal recommendation.

Two recent rulings in the House of Commons and the Senate concluded that creating or increasing a refundable tax credit would require a royal recommendation.

On June 4, 2007 the Speaker of the House ruled that a proposed amendment to Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, to create a refundable tax credit could not be selected at report stage because the amendment required a royal recommendation.

On May 11, 2006 the Speaker of the Senate ruled that private member's Bill S-212, an Act to Amend the Income Tax Act (Tax Relief) was out of order because it would have increased a refundable tax credit. The Speaker of the Senate stated:

--bills proposing to alter refundable tax credits need a royal recommendation. This is because the payouts that will be made to taxpayers who are entitled to claim them must be authorized. This authorization is the royal recommendation. These payments can only be made from the CRF; they are expenditures of public money.

Since Bill C-290 would create a new refundable tax credit, it must be accompanied by a royal recommendation.

Bill C-445—Speaker's RulingPoints of Order

May 2nd, 2008 / 10 a.m.
See context


The Speaker Liberal Peter Milliken

I am now prepared to rule on the point of order raised by the government House leader and minister for democratic reform on April 8, 2008 concerning the requirement for a royal recommendation for Bill C-445, An Act to amend the Income Tax Act (tax credit for loss of retirement income) standing in the name of the member for Richmond-Arthabaska.

I would like to thank the hon. government House leader as well as the hon. member for Richmond--Arthabaska for their contributions on this issue.

In his intervention, the hon. government House leader stated that refundable tax credits are direct benefits paid to individuals regardless of whether tax is owed or not and are paid out of the consolidated revenue fund. He argued that a legislative proposal creating such a tax credit therefore needed to be accompanied by a royal recommendation.

In support of his argument, he pointed to a Speaker's ruling of June 4, 2007, which did not select a report stage amendment to Bill C-52, the Budget Implementation Act, 2007, that sought to create a refundable tax credit because it required a royal recommendation. He also referred to a ruling of May 11, 2006 from the Speaker of the Senate that ruled out of order Bill S-212, an Act to amend the Income Tax Act (tax relief) on the basis that it increased a refundable tax credit.

In response, the hon. member for Richmond--Arthabaska argued that legislation proposing a reduction in taxes has always been permitted under our parliamentary rules, even if this leads to reimbursements being made to taxpayers.

To support his arguments, he pointed to a ruling by Mr. Speaker Parent of October 16, 1995 regarding Bill S-9, An Act to amend the Canada-United States Tax Convention Act, 1984.

The Chair has carefully reviewed Bill C-445, the previous rulings that were cited as well as the comments from the hon. members and believes that the central issue in the present case is whether the creation of the tax credit found in Bill C-445 is strictly an alleviation of taxation or an authorization to spend for a new and distinct purpose. If it is the latter, the bill would need to be accompanied by a royal recommendation before the third reading motion can be proposed to the House.

The bill standing in the name of the hon. member of Richmond--Arthabaska seeks to amend the Income Tax Act by providing for a tax credit to a taxpayer in respect of whom an employer and the employees failed to make required registered pension plan contributions. Whether or not the tax credit is refundable or non-refundable is the key issue in determining the need for a royal recommendation.

Non-refundable credits are deducted from a person's tax payable rather than being calculated separately: they simply reduce the amount of tax payable by an individual. The amount of the credit is limited to the amount of the tax payable.

This is not the case for refundable tax credits, which are unique in the Income Tax Act: they provide for a taxpayer to receive an amount from the government due to a low amount of taxable income and tax payable. Such credits are calculated separately on an income tax return because they are not simply alleviations of taxes otherwise payable.

Bill C-445 is proposing a refundable tax credit. The Chair is of the opinion that the bill would not only alleviate taxation but also potentially allow monies to be disbursed from the consolidated revenue fund, in the event the taxpayer had taxable income for the year that yielded taxes less than the amount of the credit.

The circumstances of Bill C-445 are quite different from those referred by the hon. member for Richmond--Arthabaska in the ruling concerning Bill S-9. There, reimbursements were limited to tax payable. By making a tax credit refundable, Bill C-445 could lead to refunds that are greater than taxes paid. Such spending, for a new and distinct purpose, would need to be accompanied by a royal recommendation.

Accordingly, the Chair will decline to put the question on third reading of this bill in its present form unless a royal recommendation is received.

The debate, later today or on Monday, is currently on the motion for second reading and, as usual, this motion will be put to a vote at the close of the second reading debate.

I thank the hon. government House leader and the member for Richmond—Arthabaska for their comments on this matter.

Royal Recommendation--Bill C-445 and Bill C-490Points of OrderRoutine Proceedings

April 8th, 2008 / 10:05 a.m.
See context

York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, I rise on a point of order. I want to speak to the question of the need for a royal recommendation on two private members' bills.

On March 11, 2008, you noted that the spending provisions in two private members' bills appear to infringe on the financial initiative of the Crown. You invited members to make arguments on whether those bills require a royal recommendation. That is what I intend to do at this time.

The two bills are Bill C-445, An Act to amend the Income Tax Act (tax credit for loss of retirement income), and Bill C-490, An Act to amend the Old Age Security Act (application for supplement, retroactive payments and other amendments).

Let me begin with Bill C-445. This bill would create a new refundable tax credit for the loss of retirement income.

Refundable credits are direct benefits paid to individuals regardless of whether tax is owed or not and are paid out of the consolidated revenue fund. As a result, any legislative proposal to create a refundable tax credit requires a royal recommendation.

I would draw to the attention of the House two recent rulings wherein the Speaker of the House and the Speaker of the Senate concluded that creating or increasing a refundable tax credit requires a royal recommendation.

On June 4, 2007, there was a Speaker's ruling that a proposed amendment to Bill C-52 to create a refundable tax credit could not be selected for report stage because the amendment required a royal recommendation.

On May 11, 2006, the Speaker of the Senate ruled that Bill S-212 was out of order because it would have increased a refundable tax credit. The Speaker of the Senate stated:

--bills proposing to alter refundable tax credits need a Royal Recommendation.

This is because the payouts that will be made to taxpayers, who are entitled to claim them, must be authorized. This authorization is the Royal Recommendation. These payments can only be made from the Consolidated Revenue Fund; they are expenditures of public money.

Since Bill C-445 would create a refundable tax credit, it needs to be accompanied by a royal recommendation.

Now, in regard to Bill C-490, this bill proposes a number of changes to the old age security program which would result in increased spending and would therefore require a royal recommendation.

Clause 1 of Bill C-490 would apply to a person who ceases to have a spouse or common law partner because of the spouse's or common law partner's death and would provide that person with the old age security pension that would have been payable to the person's spouse or common law partner, for a period of six months. This extension of benefits would be a new program requirement, which would result in additional spending.

On December 8, 2004, a Speaker's ruling in the case of Bill C-278 concluded that a similar extension of benefits for the employment insurance program constituted a new and additional requirement for spending, and therefore required a royal recommendation.

Clause 2 of Bill C-490 would eliminate the requirement to make an application for a supplement for old age security benefits. Formal application is needed since the information available from the Canada Revenue Agency is sometimes insufficient to determine eligibility. This change would result in benefits under the old age security program being provided to persons who otherwise would not be eligible to receive them. This would be a new program requirement that would require additional spending.

On October 24, 2005, a Speaker's ruling with respect to a provision in Bill C-301, dealing with other proposed retroactive payments under the old age security program, concluded that:

Bill C-301...proposes to alter the process by which compensation is awarded to old age security recipients in the manner that retroactivity is handled.

Clauses 2, 3 and 4 remove the requirement that the recipient must make an application before they can receive a payment...This changes the conditions of the compensation process and creates new or additional spending.

Clause 3 of Bill C-490 would increase the guaranteed income supplement monthly benefit by $110. The Department of Human Resources and Social Development estimates that this change could cost up to $2 billion a year. This would constitute additional spending for a new and distinct purpose and would therefore require a royal recommendation.

Clause 6 of Bill C-490 would provide for retroactive payments where a person has not received a supplement, or a portion of a supplement, to which that person would have been entitled under the act.

On October 24, 2005, a Speaker's ruling on the retroactivity of payments in the case of Bill C-301, respecting the monthly guaranteed income supplement under the Old Age Security Act, concluded that:

--retroactivity is limited by the date upon which the application was made. Late applicants may only be eligible for the period dating from the application. It would appear then that this modification authorizes increased spending which would require a royal recommendation.

The Department of Human Resources and Social Development estimates that Bill C-490's provision of unlimited retroactivity for guaranteed income supplement monthly benefits could represent an initial lump sum payment to beneficiaries of up to $6 billion.

In conclusion, Bill C-490 would result in increased spending for the old age security program in the new and distinct ways I have just outlined. The bill therefore requires a royal recommendation.

Motions in AmendmentIncome Tax ActPrivate Members' Business

November 28th, 2007 / 6:35 p.m.
See context

Macleod Alberta


Ted Menzies ConservativeParliamentary Secretary to the Minister of Finance

Mr. Speaker, my colleague has always spoken very positively about the need for education, the need for students in Canada to have access to good education and, in our discussions in the foreign affairs and international development committee, the need to incent young students coming from other parts of the world to get their education in Canada.

However, we have some very grave concerns with Bill C-253, which initially contemplated that the deduction would be limited to an RESP annual contribution limit of $5,000, indexed after 2006. However, budget 2007 eliminated the RESP annual contribution limit and raised the lifetime contribution limit to $50,000 from $42,000.

Amendments to the Income Tax Act to implement these changes were made in Bill C-52, which was assented to in June 2007, to which the hon. member has alluded.

These changes were extremely well received. Indeed , Peter Lewis, chair of the Registered Education Savings Plan Dealers Association of Canada, called the changes “a very positive leap forward for Canadian families”. He went on to say:

These improvements will benefit all Canadian families, and provide even greater incentive to invest in their children's college or university education. And that's good for everyone.

We sincerely commend [the] Finance Minister...for recognizing the value and importance of encouraging families to save for post-secondary education.

The proposed amendments adjust the bill to reflect the elimination of the RESP annual contribution limit. The effect of the proposed amendments would be to allow a taxpayer to claim a deduction for RESP contributions of up to $50,000. The amount of the deduction would be reduced by the total RESP contributions made by the taxpayer in previous years.

As we have stated in analysis provided previously, the behavioural impact is uncertain. If the RESP contributions were to increase by 20%, the total fiscal cost of Bill C-253 would be $765 million per year, including a CESG cost increase of $85 million per year.

The proposed amendments, if adopted, would not allow RESP contributors any more leeway in allowing up to an annual $50,000 deduction for their contributions.

While it is uncertain how much this would exactly increase total RESP contributions and the specific long term costs of Bill C-253, it is likely the proposed changes could again increase the cost of the deduction in the early years following implementation.

Therefore, we will not be supporting Bill C-253.

Motions in AmendmentIncome Tax ActPrivate Members' Business

November 28th, 2007 / 6:25 p.m.
See context


Dan McTeague Liberal Pickering—Scarborough East, ON


Motion No. 1

That Bill C-253, in Clause 2, be amended by deleting lines 10 to 24 on page 1.

Motion No. 2

That Bill C-253, in Clause 2, be amended by replacing lines 8 and 9 on page 2 with the following:

“(b) the RESP lifetime limit minus the total of all contributions made by the taxpayer into a registered education savings plan in previous taxation years.”

Mr. Speaker, I am pleased to speak today. If I may, I will take the opportunity to congratulate you on what I believe is a very well deserved citation by all your colleagues in the House as the most honourable of our members. I realize that you have said you will be leaving at some stage, but clearly you are just coming into your own stride and I suggest that you may want to reconsider that position.

Bill C-253, now at report stage, is an act to amend the Income Tax Act in relation to the deductibility of RESP contributions by the contributor.

As colleagues know, I have proposed two amendments to this bill as a result of changes in the RESP regime created by the 2007 budget. People who are watching and in fact listening will know that there were changes made subsequent to changes in the RESP regime, as well as with respect to the last budget.

I will discuss these changes and the necessity of my amendments in a moment, but I note that registered education savings plans allow taxpayers to accumulate funds for their children to use toward the high costs often associated with obtaining post-secondary education.

Technically, an RESP is a contract between an individual, the subscriber, and a person or organization, the promoter. I should point out that the subscriber or the person acting for the subscriber generally makes contributions to an RESP, and the contributions, as we know, earn an income. The subscriber names one or more beneficiaries, one's child or children who are eventually going to attend post-secondary institutions, and agrees to make these contributions ultimately for them.

These contracts are then registered with the Canada Revenue Agency. From a tax perspective, which should be known, contributions made to an RESP are not deductible by the subscriber. Further, leftover funds in an RESP, after amounts are paid to a beneficiary, that are returned to the subscriber are not included in the subscriber's taxable income. Instead, contributions that are paid to a beneficiary of an RESP become taxable income of the beneficiary.

Before the 2007 budget, subscribers were limited in both the annual and the lifetime amounts they could contribute to an RESP. I should point out that after the 2007 budget implementation act, Bill C-52, was passed in the first session of this Parliament, the RESP annual limit was removed and only the RESP lifetime limit remained.

What that meant was the occasion to necessitate an amendment, and an amendment to Bill C-253 put forward by the House of Commons Standing Committee on Finance created a deduction for the subscriber, the contributor, for the taxable income for contributions made to an RESP.

This deduction, however, was limited to the RESP annual limit as defined in the former provisions of the Income Tax Act and prior to the passage of the budget in 2007.

Finally, Bill C-253 ensured that leftover funds in an RESP that are returned to the subscribers become taxable income of the subscribers themselves. The amendments I have proposed simply remove the proposed provisions in the bill that contain a reference to the RESP annual limit.

Bill C-253 nonetheless retains the tax deduction for contributions made to an RESP, but this annual deduction amount is now limited by the RESP lifetime limit, rather than the RESP annual limit.

That annual limit, for the benefit of all my colleagues here, will remain, and under the pre-RESP regime it was certainly there, at $50,000. A provision, paragraph 2(4)(2.01)(b), is also added for accounting purposes to ensure that contributions made in previous years are taken into account in determining the annual contribution deduction so that the RESP lifetime limit is not exceeded.

Members will know that in my last speech on Bill C-253 I made it abundantly clear that existing provisions of the Income Tax Act as concerns RESPs provide harsh penalties for anyone who tries to use an RESP as a tax shelter. Let us be clear on that. One cannot use this as an RESP shelter, much in the same way that the guidelines exist with respect to RRSPs.

While I will not rehash the details as I have only a limited amount of time, I must point out and will again repeat that should a beneficiary of an RESP, a child, not attend a post-secondary institution, in this case the funds accumulated in that RESP account are returned to the contributor and the moneys earned beyond the actual contributions made are indeed taxed. They are taxed significantly.

The tax rate, so everyone will know, would be 20% over and above the regular tax paid on the income. Like many other people, I feel that rate more than adequately deters anyone from using the RESP as some scheme or tax shelter. The lifetime limit of $50,000, in addition to the 20% penalty, further detracts from the usage of an RESP as a vehicle to avoid taxes.

I also mentioned in my previous remarks the soaring costs of post-secondary education in Canada. I did put a great deal of emphasis on that then and it clearly has not changed. By some estimates, there is now a cost of over $100,000 by the year 2010 for a four-year degree program.

That is a lot of money. I cannot see how families are going to be able to make ends meet without having some kind of opportunity, one that does not take away from the public treasury but in fact contributes to the development of our young by providing them access to post-secondary education in a way that uses the existing system but builds and improves on it.

There is also the issue of the fact the RESP is not being used by a majority of Canadian families to offset the rising cost of post-secondary education. I should point out, as all of this has been taking place in the past, that we have seen a number of examples where Canadians have not had the benefit or the opportunity of ensuring their positions and their ability to become more meaningful members of society in terms of adequate attention to education. It has not been made available, as we can certainly see by the fact that many have not had an opportunity to provide the savings.

While a large number of savings opportunities exist for parents and families, they are always, frankly, after-tax opportunities. Therefore, I am looking to Parliament to look much deeper, to use an existing system that I believe works for all Canadians. I believe we need a system so that Canada is able to meet the competitive edge, as so many are pointing out we will need to do in order to provide a continuous education and a reformed idea in terms of our education system. We need to allow young people and people throughout the course of their lives to make the kinds of transitions that I think are very much a necessity in terms of building a modern, adaptable and flexible society.

In the two minutes I have left, I would also like to point out that a few other areas have come to our attention very recently. One is with respect to the ability of many of our universities to continue to attract high calibre and state of the art types of equipment and technologies and to bring in professors and staff who will allow our young people to benefit at our universities and at any post-secondary level of education and to get the very best. To do that, I note, we are living in an increasingly competitive international market. It can hardly be blamed on our universities, colleges or polytechnical schools if they do not have the ability to bring in these people without higher tuition fees.

The reality is that post-secondary education is not accessible to a vast majority of our students. For a good many, it is a challenge that they will never be able to take on.

I was speaking earlier with a few members of this House who are concerned about this limit. With the amendments I am proposing here today, which affect the annual limit for contributions, I wanted to do everything I could. In the end, the clerks informed me that it would be impossible for me as a backbencher, through a private member's bill, to amend a budget that was adopted by a vast majority of members. Thus, I cannot repeal the legislation to change the limit, which is currently set at $50,000. However, the principle remains.

Access to higher education is limited to some 20% of students. That number should be 100%. This bill proposes ways to improve the system to ensure that people can contribute to their RESP. I look forward to hearing other members' comments.

November 27th, 2007 / 5:10 p.m.
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Margaret Lefebvre Executive Director, Canadian Association of Income Funds

Thank you very much. The Canadian Association of Income Funds has been before this committee on several occasions in the last year, and we're glad to be here again regarding the income trust policy announced on October 31, 2006.

Bill C-52, the first Budget 2007 implementation bill, which contained the income trust legislation, did not in fact address significant implementation issues that require immediate attention. It is to address these issues that we appear before you today.

However, the committee should also be aware that the damaging consequences of the government's actions continue. Since October 31, 2006, there have been more than 42 transactions that involved the selling, merging, or acquisition of income trusts with an enterprise value in excess of $31 billion. The majority of these transactions by dollar value involved foreign buyers of Canadian assets. Most have gone into the hands of private equity and pension funds. Virtually all of these entities will pay little or no tax to either to the federal or provincial governments.

In addition, ordinary Canadians are frozen out of participating in the potential investment benefits of not only our own natural resources but also a diverse and entrepreneurial business trust sector. Many small and medium-sized Canadian businesses have had their access to capital severely impaired. This makes them vulnerable to takeover and leaves them powerless to compete.

At best, the estimates of tax leakage at the time this bill was put forward were $500 million at the federal level and potentially $300 million at the provincial level. Together that makes $800 million. In 2006, the trust distributions from the sector totalled $16 billion. To recover totally would have required a tax rate of no more than 5%; instead we are faced with 31.5%.

Let me now turn to our technical recommendations. The following sets out some of the issues and deficiencies, although this list is not intended to be exhaustive.

No certainty or legal clarity has been given in the legislation for the transition period in the guidelines issued December 15. This clarity is urgently needed in some form, whether through the release of further policy guidance or another mechanism available to the government.

For example, under the existing guidelines, it is not clear whether issuing equity to replace debt--convertible or not--that was outstanding as of October 31, 2006, will be considered growth for the purposes of the guidelines, and whether equity issued to replace outstanding lower-tier debt will be excluded from the growth in equity capital.

In many circumstances, a trust has borrowings and lower-tier entities in which it has a direct or indirect interest, and such debt should be considered the same as replacement of the debt of the trust.

Also, no legislative framework was included in the legislation to facilitate conversion back to corporate status on a tax-deferred basis, similar to other tax-deferred rollover rules that already appear in the tax act.

By opposing the high level of statutory corporate tax rates on trusts, and especially on the distributions, the government has clearly signalled the elimination of the trust sector. There was no legislative mechanism in the bill to eliminate the remaining trust vehicle in a tax efficient manner after conversion to a corporation.

Such rules are necessary to remove uncertainty and provide an orderly transition. Furthermore, the trust rules have such breadth of application as to bring within their ambit non-publicly traded units under certain circumstances, which surely could not have been the intent.

This matter has been brought to the attention of the Department of Finance by this association, a host of income trusts, and the joint committee of the CICA and the Canadian Bar. We urge this committee to move quickly on recommendations to rectify these issues so the businesses can make informed decisions during the transition period.

We welcome the direction of the reduction in the corporate tax rate in the economic statement. Within this paradigm we are anxious to sit down with the government and find an appropriate resolution to the damaging consequences outlined today within the government's stated corporate tax policy. CAIF is ready to sit down with the finance department as soon as possible.

Thank you.

Sitting ResumedGovernment Orders

November 1st, 2007 / 11:50 a.m.
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Mike Wallace Conservative Burlington, ON

Mr. Speaker, I just want to ensure that the House is aware and clear on the facts. I also have a question that goes along with the facts.

A number of members have made mention, including the previous speaker, that we have not been investing federally as a government in child care spaces. If they disagree with the $100 per child, per family, under the age of six, that is fine.

However, I want to point out that Bill C-52 was passed in the House on June 22, 2007 and received royal assent. A section in the act, if they would care to read it, is called child care spaces. The finance minister is authorized to give $250 million to the provinces to create child care spaces in the provinces. It was set up. The provinces have the responsibility and the expertise for developing child care spaces.

The question should be: Where did the money go? It was included in the social transfer; $250 million annually.

My question is for the member. Can you remember what the Liberals put in their implementation bills--

Opposition Motion--The EconomyBusiness of SupplyGovernment Orders

October 25th, 2007 / 11 a.m.
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Mike Wallace Conservative Burlington, ON

Mr. Speaker, I thank the Parliamentary Secretary to the Minister of Finance for sharing his time with me and congratulate him on his new role. I know he will do a fantastic job in that office.

I welcome the opportunity to speak to the motion of the hon. member for Markham—Unionville.

At the outset, it is important to acknowledge my colleague's recognition of our government's efforts to lessen the tax burden on Canadian families, individuals and businesses. His motion correctly highlights that we have significantly reduced both personal and corporate taxes, as well as the national debt, in order to increase the competitiveness of Canada's economy.

Clearly, as an economist by training, he has a fine eye for effective economic policy. We appreciate his support and trust that there may well be others across the aisle who share his views but are somewhat resistant to be overly positive.

Accordingly I will take a little time today to reiterate what we have done so far on both tax and on the debt side of the ledger, with the hope that others might find the courage exhibited by my friend opposite to speak positively and publicly about the government's accomplishments.

It would appear, given the second portion of the motion, that the member for Markham—Unionville may be unaware of the positive work we have done with respect to investing in infrastructure, post-secondary education and so on. Therefore, I also will take some time to address what we have done in these areas.

With respect to reducing taxes, our credentials are solid and have been from the moment we assumed office. We have provided more than $41 billion over three years in tax relief for individuals and businesses. As the Minister of Finance has noted often, there is more still to come.

We will build on the efforts and continue to create a tax advantage for Canada, which will fuel economic growth, investment and the creation of wealth. It started less than 18 months ago, in May 2006, with the 2006 federal budget. For those who have not read it, I have it here with me.

The document proposed 29 personal and business tax relief measures that provided more than $20 billion of personal tax relief alone. That sum, which represents more than the four previous federal budgets combined, helps me to better understand the praise of my friend of whom I referred to earlier. Clearly, he probably wishes that the previous government had taken similar action on behalf of Canadian taxpayers.

For example, he no doubt recognizes the wisdom of providing tax relief for each and every working Canadian through the introduction of the Canadian employment credit. I say this with all sincerity, who can argue with providing a tax credit to recognize the cost of work related expenditures such as home computers, uniforms and supplies?

Similarly, who among us would oppose the creation of the children's fitness tax credit as a means to encourage healthy, active kids by helping to cover the eligible fees up to $500 for enrolment in physical activity programs? Who would oppose the new textbook credit for students to help offset the cost of textbooks? Who would oppose increasing the basic personal amount that an individual can earn every year before paying federal income tax? Who would oppose a 1% point reduction in the GST that benefits all Canadians, including those who do not earn enough to pay personal income tax?

Who, one may ask? That would be the members of Her Majesty's Loyal Opposition. That would be the same party that opposed the government's fair tax credit plan, a plan proposed with significant measures to help Canadian seniors. As hard as it is to believe, the Liberals opposed tax fairness. In doing so, that means they are opposing helping Canadian seniors plan for a better retirement through an increase in the age credit amount and the historic action of permitting income splitting for Canadian pensioners. Frankly, it is very hard to fathom.

It should therefore not be so hard to believe that the same group of folks has not supported the long term plan to build a strong economy for Canadians, “Advantage Canada”, by creating key advantages, including a tax advantage that would set Canada apart from our competitors around the world.

Maybe it is a little hard to believe that Liberal members are opposed to creating a tax advantage for Canada to help us attract and maintain the workers and the capital investment that Canada requires to succeed and prosper in the 21st century.

Maybe it is a little hard to believe that Liberal members oppose a tax advantage that is fiscally responsible and that will build a stronger Canada and help to improve the quality of life for all Canadians.

It is also hard to believe, at least for those of us on this side of the House, that responsible people could oppose the creation of other key advantages envisioned under “Advantage Canada”, a fiscal advantage, an entrepreneurial advantage, a knowledge advantage and an infrastructure advantage.

How else are we to explain that at the first opportunity they had to show their support toward creating comprehensive advantages for Canada, the vote on Bill C-52 in the last session, Liberals said nay.

Those members said nay to the creation of the tax back guarantee, through which all interest savings from the reduction of national debt would be returned to taxpayers in the form of income tax redemptions.

Liberals said nay to the working families tax plan and the creation of a $2,000 child tax credit that would provide up to $310 per child of tax relief to more than three million Canadian families starting this year.

Liberals said nay to increasing spousal and other deductions in order to provide up to $209 in tax relief starting this year for a supporting spouse or a single taxpayer who was supporting a child or relative.

Liberals said nay to reducing the general corporate tax rate by 0.5% effective January 1, 2011.

Liberals said nay to establishing a federal foreign convention and tourism incentive program.

Liberals said nay to the introduction of the green levy on inefficient fuel vehicles.

Liberals said nay to predictable long term funding to the Canada social transfer to support post-secondary education, social assistance and social services.

I could go on, but I trust the general idea that I am trying to put forward here is very clear to everybody in the House.

The fact is the opposition tries to make all the right sounds and hit all the right buttons about lowering taxes, increasing productivity, investing in infrastructure and R and D, but when it comes to actually doing something about it and following through and doing the right thing, those members abdicate. It hardly inspires confidence in Canadians that they will actually do the right thing when they next get a chance. Let us hope that is many years away.

However, given the wording of the motion before us today, I am willing to give the opposition the benefit of the doubt. Soon the government will introduce the 2007 budget implementation bill. Members opposite will have the opportunity to walk the walk or talk the talk. They will be able to tangibly demonstrate that they mean business by voting yea and not nay to the tax measures that will benefit Canadians and help create the Canadian tax advantage.

For example, among other measures the Liberals can say yea to is the introduction of the working income tax benefit to help people who are out of work get back to work and over the welfare wall.

Liberals could say yea to expanding the scope of the public transit credit to better encourage individuals to make a sustained commitment to public transit use.

Liberals could say yea to increasing the lifetime capital gains exemption to $750,000 to increase the rewards for investing in small business, fishing and farming.

I look forward to the pending debate on these important matters. I hope I am not wrong in giving the benefit of the doubt to my friends across the way.

Message from the SenateRoyal Assent

June 22nd, 2007 / 12:20 p.m.
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The Speaker Liberal Peter Milliken

I have the honour to inform the House that when the House did attend Her Excellency the Governor General in the Senate chamber Her Excellency was pleased to give, in Her Majesty's name, the royal assent to the following bills:

Bill C-12, An Act to provide for emergency management and to amend and repeal certain Acts--Chapter 15;

Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs)--Chapter 16;

Bill S-6, An Act to amend the First Nations Land Management Act--Chapter 17;

Bill C-40, An Act to amend the Excise Tax Act, the Excise Act, 2001 and the Air Travellers Security Charge Act and to make related amendments to other Acts--Chapter 18;

Bill C-11, An Act to amend the Canada Transportation Act and the Railway Safety Act and to make consequential amendments to other Acts--Chapter 19;

Bill C-277, An Act to amend the Criminal Code (luring a child)--Chapter 20;

Bill C-31, An Act to amend the Canada Elections Act and the Public Service Employment Act--Chapter 21;

Bill C-18, An Act to amend certain Acts in relation to DNA identification--Chapter 22;

Bill C-60, An Act for granting to Her Majesty certain sums of money for the federal public administration for the financial year ending March 31, 2008--Chapter 23;

Bill C-14, An Act to amend the Citizenship Act (adoption)--Chapter 24;

Bill C-47, An Act respecting the protection of marks related to the Olympic Games and the Paralympic Games and protection against certain misleading business associations and making a related amendment to the Trade-marks Act--Chapter 25;

Bill C-61, An Act to amend the Geneva Conventions Act, An Act to incorporate the Canadian Red Cross Society and the Trade-marks Act--Chapter 26;

Bill C-42, An Act to amend the Quarantine Act--Chapter 27;

Bill C-59, An Act to amend the Criminal Code (unauthorized recording of a movie)--Chapter 28;

Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007--Chapter 29;

Bill C-288, An Act to ensure Canada meets its global climate change obligations under the Kyoto Protocol--Chapter 30.

It being 12:23 p.m., the House stands adjourned until Monday, September 17, 2007, at 11 a.m., pursuant to Standing Orders 28(2) and 24(1).

The first session of the 39th Parliament was prorogued by royal proclamation on September 14, 2007.

Sittings of the HouseBusiness of the HousePrivate Members' Business

June 20th, 2007 / 6:15 p.m.
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Peter Van Loan Conservative York—Simcoe, ON

Mr. Speaker, I would be happy to assist the Liberal House leader.

In terms of the precedent, the whole nature of this motion is, of course, an amendment to Standing Order 28. The same constraints that are being applied to the Speaker's discretion with regard to a recall of Parliament, in that it provides for it, are the same type of directions that are being provided in terms of the royal assent ceremony, which is the second aspect of this motion.

The intent of the motion and as it is drafted it would only create a right of recall for the government in relation to Bill C-52, the budget implementation bill.

Sittings of the HouseBusiness of the HousePrivate Members' Business

June 20th, 2007 / 6:15 p.m.
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Ralph Goodale Liberal Wascana, SK

Mr. Speaker, in order to have complete clarity with respect to the motion that the government House leader has just put forward in the House, I wonder if the government House leader could indicate to us the availability of precedents with respect to the constraint upon your discretion, which is involved in the reference in the motion to Standing Order 28(4).

That necessarily imposes a restraint on your discretion, Mr. Speaker, and substitutes instead the discretion of the government. I would be interested to know, since that is a serious matter in our Standing Orders, if the government House leader can inform the House, after consultation with the Table, which I am sure he has had, whether there are in fact the appropriate precedents for this type of provision to be included in an adjournment motion.

Mr. Speaker, I wonder if we have the clear assurance, because the wording of this motion is somewhat complex, that the special provisions being referred to here apply only in relation to this adjournment and only in relation to matters pertaining to Bill C-52.

Sittings of the HouseBusiness of the HousePrivate Members' Business

June 20th, 2007 / 6:10 p.m.
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York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, I have another motion but I will read this one a little more slowly. I move:

That, notwithstanding any Standing or Special Orders or usual practices of the House, when the House adjourns on Wednesday, June 20, 2007, it shall stand adjourned until Monday, September 17, 2007, provided that, for the purposes of Standing Order 28, it shall be deemed to have sat on Thursday, June 21, and Friday, June 22, 2007; and, for the period of this adjournment only, in relation to Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, Standing Order 28(3) shall read:

“Whenever the House stands adjourned, and at the request of the Government that the public interest requires that the House should meet at an earlier time, the Speaker shall give notice that the House shall meet for the sole purpose of considering Bill C-52, and thereupon the House shall meet to transact this said business. In the event of the Speaker being unable to act owing to illness or other cause, the Deputy Speaker, the Deputy Chair of Committees or the Assistant Deputy Chair of Committees shall act in the Speaker's stead for all the purposes of this section”, Standing Order 28(4) shall be amended by replacing the word “may” with the word “shall” and Standing Order 32(1.1) shall be amended by deleting “to be given royal assent”.

The BudgetStatements By Members

June 15th, 2007 / 11:15 a.m.
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Guy Lauzon Conservative Stormont—Dundas—South Glengarry, ON

Mr. Speaker, this week Bill C-52, legislation implementing budget 2007, passed third reading in the House.

This is a great budget that stands to benefit all Canadians in all provinces. There is $1 billion in health care funding, $1.5 billion in clean air funding, $225 million for the nature conservancy of Canada, $614 million for federal-provincial infrastructure projects, $30 million to protect British Columbia's Great Bear Rainforest, $30 million for Rick Hansen's foundation, and $133 million in new aid to help the people of Afghanistan rebuild their lives and their country.

A majority of democratically elected members passed this legislation. Why then is an unelected Liberal dominated Senate holding up the passage of Bill C-52, a bill that Canadians want and need?

A leader gets the job done. Why can the Leader of the Opposition not get the job done by insisting his Liberal senators approve this great budget?

The BudgetStatements By Members

June 15th, 2007 / 11:10 a.m.
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Gary Goodyear Conservative Cambridge, ON

Mr. Speaker, just as they did on Senate term limits, the unelected, clearly unaccountable Liberal senators are trying to hold up passage of Bill C-52, which could cost Canadians almost $4 billion, money the region of Waterloo and my riding of Cambridge desperately needs, money for our environment, spinal cord research, and our labour training initiatives.

It is bad enough that the Liberals and NDP members voted against money for women and girls with cervical cancer in Cambridge and North Dumfries, but in doing so they said no to their own women and girls. They also said no to firefighter training in their own ridings. They said no to money for school boards in their own ridings.

The Conservative government has clearly delivered for Canadians. It is time the Liberals and the Liberal senators do the same. I urge the Liberal interim leader to stand up to his Liberal senators for Canadians and stop these selfish political games for power.

Business of the HouseGovernment Orders

June 14th, 2007 / 3:10 p.m.
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York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, I will be happy to address that in the affirmative in a moment but there is more that we should know about in terms of the business we are doing.

We will continue today with Bill C-42, the quarantine act, Bill C-58, the railway transportation bill and Bill C-21, An Act to amend the Criminal Code and the Firearms Act (non-registration of firearms that are neither prohibited nor restricted).

Tonight we have the emergency debate pursuant to Standing Order 52 that the Speaker has determined should proceed.

On Friday we will call Bill C-33, the income tax bill and Bill C-6, the aeronautics bill.

Next week is got the job done week when the House has completed the nation's business for this spring's session. During the got the job done week we will continue and hopefully complete the business from this week, as well as some new legislation and legislation that will be out of committee or the Senate.

The list of bills that are currently on the order paper, in addition to those I have identified for this week that I would like to see completed by the House before the summer recess are: Senate amendments to Bill C-31, An Act to amend the Canada Elections Act and the Public Service Employment Act.

There are also the following bills: Bill C-32, An Act to amend the Criminal Code (impaired driving) and to make consequential amendments to other Acts; Bill C-44, An Act to amend the Canadian Human Rights Act and Bill C-53, An Act to implement the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention).

Another bill includes Bill C-54, An Act to amend the Canada Elections Act (accountability with respect to loans).

By the end of next week, Canadians expect that the Senate will have completed its consideration of budget Bill C-52 without any amendments so that they can relax for the summer with the knowledge that $4.3 billion in the 2006-07 year end measures will be in play.

If there are amendments, we will have to be here in the House to respond and protect measures that might otherwise be lost, such as a $1.5 billion for the Canada ecotrust for clean air and climate change; $600 million for patient wait times guarantees; $400 million for the Canada infoway; $100 million for the CANARIE project to maintain the research broadband network linking Canadian universities and research hospitals; $200 million for protection of endangered spaces; and much more.

The BudgetOral Questions

June 14th, 2007 / 3 p.m.
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Louis-Saint-Laurent Québec


Josée Verner ConservativeMinister of International Cooperation and Minister for la Francophonie and Official Languages

Mr. Speaker, this is an important issue.

In the Budget Implementation Act, 2007, we committed to giving $135 million to reconstruction and development in Afghanistan. Unfortunately, unelected Liberal senators are delaying Bill C-52.

We hope that the opposition members will support our development efforts for the Afghan people. Were they not the first to demand more money for reconstruction and development in Afghanistan and Kandahar?

HealthOral Questions

June 14th, 2007 / 2:55 p.m.
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Joy Smith Conservative Kildonan—St. Paul, MB

Mr. Speaker, yesterday the Liberal MP for Bramalea—Gore—Malton made a statement in the House praising Rick Hansen for his dedication to raising research funding to treat spinal cord injuries. Yet this week the member voted against a budget that gave the Rick Hansen Foundation $30 million to continue its important work.

Could the Minister of Health convey to the House what will happen to that funding if the Liberal Senate delays the adoption of Bill C-52?

Budget 2007 Implementation ActStatements By Members

June 14th, 2007 / 2:15 p.m.
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Daniel Petit Conservative Charlesbourg—Haute-Saint-Charles, QC

Mr. Speaker, the Liberals do not recognize the fiscal imbalance, and now they are voting against Bill C-52.

The bill is now before the Senate, which is comprised of a majority of unelected Liberal senators. If the bill is blocked by the Liberals in the Senate, it will result in the loss of more than $4 billion in tax breaks and funding for programs to the end of the 2006 fiscal year, including more than $1 billion to help provinces reduce patient wait times and $1.5 billion for provincial environmental initiatives in support of projects that reduce greenhouse gas emissions.

The Leader of the Liberal Party should show a bit more leadership by urging irresponsible Liberal senators to make the interests of Canadians their priority, to respect the will of the House of Commons and to vote for bill C-52.

June 14th, 2007 / 10:20 a.m.
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The Chair Conservative Rob Anders

That's very kind of you, sir. Thank you.

I see people up and getting around. Stay in the room. We have some other things to deal with.

There is this issue of when the House will break. I don't know. I have no crystal ball on these matters. My general sense, for whatever members wish, is that I believe the government whip is waiting to see what will be done with Bill C-52, or the budget, in the Senate. If the Senate sees fit to have that budget bill move out of there without significant amendment, then I think the House will rise for the summer. If the Senate makes substantive amendments to the budget, then I think the House will wait until that bill has a chance to come back and be re-amended by the House.

Anyhow, that's all in the hands of the Senate, and I understand there were probably discussions with regard to this amongst the official opposition caucus on Wednesday morning, which I was not privy to, but I'm sure the issue was raised.

That being said, we do have questions. A lot of other committees are wrapping up their business and closing down for next week, pending the House closure.

Monsieur Gaudet, I notice you had your hand up.

Budget Implementation Act, 2007Government Orders

June 12th, 2007 / 5:15 p.m.
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Roy Cullen Liberal Etobicoke North, ON

Mr. Speaker, I am pleased to rise to speak to Bill C-52, An Act to implement certain provisions of the budget.

I listened to the member for St. Catharines talk about how the Conservative government is setting up the new seniors council. After the Conservative government talked about not having patronage appointments, what it has done is it has disbanded the National Council on Aging, an organization that had been set up by our Liberal government, and has started a new seniors council. The council basically has the same mandate and the same terms of reference, but there is one noticeable difference: it is stacked with Conservative appointees. This is not strictly a budget matter, but I had to comment on it.

This budget lacks vision. It lacks a direction for Canada. It is a collection of some sundry items, but it has no cohesion. There is a large amount of spending, spending in the wrong areas and spending that is going to be inflationary. In fact, we are already finding that it is inflationary because of the intended actions of the Bank of Canada to deal with it. We knew it would be inflationary. If the spending had been put in the right places, it would not have been as inflationary and might have had some benefit. The spending is in the wrong areas. Let me give an example.

Of course we know the Conservative government wants to reduce the GST, but in doing so, it increased personal income taxes, which any self-respecting economist will say is not good economic policy.

The government has also reneged on the Kelowna accord, which was providing many benefits to our aboriginal people in terms of housing, schools, clean water and many of the basic needs that aboriginal Canadians in this country need. The government has reneged on that.

The Conservatives have failed to deliver the funding required to implement the early childhood development agreements that had been negotiated in good faith by our Liberal government. They set up this phony child care program which does not really provide any spaces for child care in Canada.

The finance minister stood in this House, and I will never forget this, and said that the acrimony with the provinces and territories had been resolved, it had been fixed. He said that the so-called fiscal imbalance had been dealt with. I remember thinking how naive can a finance minister get. Certainly that came home to roost in spades when Nova Scotia, Newfoundland and Labrador, Saskatchewan and many of the provinces said that this budget fails to deliver on equalization, that it reneges on the promise with respect to the Atlantic accord.

Income trusts are another good example. The Conservatives campaigned on the idea that they were not ever going to tax income trusts. What did they do? They broke that promise. They have come in now and taxed income trusts with hardly an apology. They wrote off about $25 billion to $30 billion in capitalized value of Canadians who counted on the word of the Conservative government not to tax income trusts. That promise was broken.

Many of us in the House would agree that the income trust question needed to be dealt with, but there were ways to deal with it in a much smarter and a much more fair way for all Canadians. In fact, the grandfathering that the government chose was not fair. It could have been done in a much more equitable fashion. In fact, I think there was an argument to be made to go back to the original raison d'être of income trusts, which was to help with the capitalization of energy companies and with property management companies. What did the government do? It brought in this measure which really hurt many Canadians who were saving for their retirement.

The government through the finance minister has come out with provisions with respect to the non-deductibility of interest expense. What the Conservatives tried to do was deal with some tax evasion measures, in other words, where income by companies is put into low tax or no tax jurisdictions and the interest expense is put into the jurisdiction of Canada and treated as an interest expense.

Yes, there was some abuse of that, but what the government has done is taken the measure to a ridiculous extreme. It has created the unintended consequence, or maybe the intended consequence, I am not sure how clearly the government thought this through, that companies in Canada will be put at a disadvantage when trying to acquire companies abroad.

The income trust decision of the government and the interest non-deductibility measures mean that Canadian companies are going to be targets of more takeovers, more takeovers than we have seen already. The list goes on of Canadian icons such as Inco, Falconbridge, Hudson's Bay and many other companies that have been taken over by non-Canadian interests. Takeovers of energy companies are going to increase, given the income trust decision, and also of companies in general, given the non-deductibility of interest measures.

What does the government do? The industry minister sits on his hands while the world goes by. He argues that the markets will solve everything and that the government should not be an interventionist. The government is finally going to respond and is proposing to make some changes to the Investment Canada Act, but I suspect it will be too little, too late.

There is one aspect of the budget that I think is particularly devastating. The budget provides no real initiative to enhance Canada's productivity, nor to enhance the rate of innovation in Canada. We have some productivity challenges, especially with respect to our neighbours to the south, our major trading partner, and this budget does nothing with respect to innovation or research and development.

We look back to the mid-1990s. Our government inherited a $42 billion deficit in 1993. In three short years, with the cooperation and the commitment of all Canadians, that deficit was eliminated and our government began on the path of reinvesting in research and innovation.

We created the Canadian Institutes of Health Research, the CIHR, and the Canada Foundation for Innovation. We set up research chairs across Canada. We also provided some funding for the indirect costs of research overheads. We changed the brain drain to a brain gain.

When a number of my Liberal colleagues and I visited the MaRS project in downtown Toronto recently and we went to the Hospital for Sick Children, I was saddened to learn that some of that brain gain is in jeopardy. We met researchers from all over the United States who had come back to Canada based on the research environment here, but they were thinking that maybe the research environment here in Canada was not so wonderful after all.

There was a lack of commitment to funding for the CIHR in this budget. There was a paltry increase. The CIHR also has some serious challenges with respect to continuity of funding. If a researcher who is an expert in his or her field cannot set up the team that he or she needs and set up a research program over a number of years, then that research is in jeopardy. That is what is happening.

There is also a significant problem with respect to the indirect costs of overheads. Our Liberal government took some measures in that area, but more needs to be done to ensure that the research environment continues here in Canada.

I will talk briefly about crime and safe streets. In our 2006 election platform, the Liberal Party promised a complete ban on handguns. In fact, the then prime minister, the member for LaSalle—Émard, came to my riding of Etobicoke North and committed our party, if elected to government, to a complete ban on handguns.

Just this weekend, again in my riding of Etobicoke North, there was another murder, a drive-by shooting. It was a senseless cowardly act. One person is dead and three are injured. This happened because of the proliferation of handguns.

It is true that handguns are coming across the border from the United States, and that is why our government made more commitments at our border to stem the flow of guns coming from the United States into Canada. More needs to be done on that front. However, the reality is that many handguns are stolen from collectors

Instead of backing away from the gun registry, which is what the Conservatives are planning to do, they should be investing in the gun registry. They should be banning handguns.

We know that putting $1 billion into arming our border guards will have no deterrent effect on the people in Chicago, Boston or wherever, who run guns or drugs into Canada. These people are not sitting around thinking that now that Canada has armed border guards they had better not run the guns or drugs into Canada. Instead of using $1 billion to arm our border guards, that money could be put into much more useful endeavours.

This budget fails on a number of accounts and I will be voting against it for sure.

The House resumed consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the third time and passed, and of the motion that this question be now put.

Budget Implementation Act, 2007Government Orders

June 12th, 2007 / 4:45 p.m.
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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--

Budget Implementation Act, 2007Government Orders

June 12th, 2007 / 4:15 p.m.
See context


Bill Casey Independent Cumberland—Colchester—Musquodoboit Valley, NS

Mr. Speaker, it is a pleasure to rise again to talk about the budget and the implementation bill, Bill C-52.

I want to address the hon. parliamentary secretary who just spoke so eloquently. I want to draw his attention a couple of things. He mentioned Mr. Dithers and criticized him and described the current Prime Minister as Mr. Action. I want to point out to him that it should not be just Mr. Action, but Mr. Right Action.

There are a lot of good things in the budget for my riding. It is a rural riding and I do not hesitate to say that there are a lot of good things in the budget for my riding, but it does not mean that one can break a contract. As we have heard over and again, this budget breaks a contract with the people of my province of Nova Scotia.

It is a nine paragraph contract signed by Cecil Clarke, the minister of energy at the time. It is the Atlantic accord agreement, which gives Nova Scotia 100% access to the gas and oil revenues, with no clawbacks, and it was meant to be applied to whatever equalization formula is in existence at the time.

Anyway, that is now broken in this budget that we are debating here today. Every day I hear the Minister of Finance, maybe the Prime Minister and maybe other ministers say that Nova Scotia can have the new formula or the old Atlantic accord. That simply is not true. They say over and again that the Atlantic accord has no amendments, that it is not changed. I do not know how they can say that because of consequential amendments in Bill C-52.

I want to read this into the record: “Section 220 of the Canada-Newfoundland Atlantic Accord Implementation Act is replaced by the following:”, and after that there could be about 10 paragraphs of replacements and amendments. Several parts of this act are amended.

As well, clause 81 amends the Canada-Newfoundland Atlantic Accord Implementation Act by adding another paragraph. This goes on for several amendments, replacements, additions and so on. This also includes the 2005 offshore revenue agreement that was negotiated by John Hamm. It is amended as well. Whole paragraphs are amended and definitions are changed. It is just not accurate to say that the old Atlantic accord is still available.

I hope that in these closing hours leading up to the vote tonight the government side will come to its senses and restore the Atlantic accord exactly as it was signed by John Hamm in 2005.

Members may recall that I voted against the budget on this issue. It was a difficult decision in a way, but in a way it was not. It was not a matter of policy whereby we decided whether it was good policy or bad policy; it was just right and wrong. The contract with my province of Nova Scotia was supposed to be a 15 year contract. In two years the government has made all these amendments to which I just referred. That changes the contract. It was supposed to go for 15 years, but it only went two years before the changes were made.

At this time I want to say that I did not make this decision easily. I want to thank my wife and others for helping me make that decision, because it affects her as much as it does me. It has had a big impact on my family and is going to have a big impact on whatever future I may have as a politician. My wife Rosemary was a very big part of this decision and I hope she is listening. I also want to thank my brother Dan. He is not interested in politics and does not have anything to do with politics, but he helped me because he actually gave me a non-political point of view on this.

Also, I had a lot help from friends and people in my riding association. A lady by the name of Tilly Armstrong said some things I will not forget. Her husband Dave and son Scott said a lot of things I will never forget. There were others like Jeff Hunt. Many people helped me make that decision.

I want to come back to the accord, because if the budget passes the House at third reading tonight, the accord as we know it, as it was negotiated in 2005, will be gone. Every single Nova Scotian will feel a loss if this happens. I hope that when it goes to the Senate the senators will use their sober second thought to review it again, to make sure that the right thing is done, and to make sure that the Atlantic accord is restored exactly as it was written, because once it is gone, it is gone, and I doubt that we can get it back.

I did not know a lot about the Atlantic accord until this debate came up. The more I got into it, the more I realized how magic it is and how well thought out it was, how well it was written and how it really represents the interests of Nova Scotia and provides a future for the economy of Nova Scotia.

I want to compliment former premier John Hamm, who did the negotiations, and Cecil Clarke, who was very much a part of them as well. He was the minister of energy at the time. We should all be grateful to them, but we should all also fight to make sure that this accord is kept exactly the way they negotiated it.

Another thing I hear quite often is that Nova Scotia gets this gift of $95 million under the new program. It is not a gift. It is just part of the same program that all the provinces have. It is not a gift any more than whatever the province of Quebec or any other province gets in the way of funding from the equalization formula.

However, somehow it is made out to be a big consideration for Nova Scotia. It is not. It is exactly the same benefit the other provinces get, but what it does do is take away the ability for the offshore revenue agreement to be attached to the new formula, which is what it was always intended to be.

What has happened is that under the budget the government has changed the whole concept of the offshore revenue agreement. It was originally envisioned to go with whatever equalization formula is in place at the time. It was to follow that. It is a rolling commitment to follow whatever the equalization formula is.

What the budget does is lock it into the previous formula. It changes the whole concept and the whole basic formula of the Atlantic accord. It means that after this budget passes it will not apply to the formula that exists at the time, but that is exactly what the formula was supposed to be. That is exactly what its purpose was.

This budget changes it dramatically and takes that away. I do not believe the people of Nova Scotia are going to accept that. Certainly it does not look like it to me from the response I have had, even just from my vote, and it absolutely puzzles me why I am getting this positive response, because all I did was ask the government to honour a signed contract. This is not a political promise. It is not something that was said loosely. This is a signed contract. It is signed by the Government of Canada.

I believe that every Canadian wants the signature of the Government of Canada to be honoured. It does not matter whether it is on a nine paragraph agreement with the Government of Nova Scotia or a trade deal with Washington or some kind of deal with Moscow. When Canada signs a contract, everybody in the world should know that it is rock solid, that it is solid gold and it will be honoured.

In this case, the signature was supposed to mean that the contract would be honoured for 15 years. It was honoured for only two years and now the government is changing it. In any case, it is a sad day at this point due to the fact that we have not made more progress. I understand that the premier of the province of Nova Scotia is in town today. I understand that he has met with the Prime Minister.

However, I do not think the government has agreed to restore the Atlantic accord, which is the only thing that Nova Scotians are going to accept at this point. At some point they might have accepted a compromise, but they are mobilized. Nova Scotians from every walk of life are mobilized and focused. They are crystallized on this matter of maintaining the Atlantic accord. Nothing other than the Atlantic accord will be accepted. We had it. We should continue to have it.

I think the government made an awful mistake to tamper with it. It had been going for two years. Nobody found a problem with it. It was working. It was accepted by all the other provinces. Why in the world the government brought it into the debate on the budget and tried to tamper with it and tried to change it, I will never understand. I think in the end the government is going to pay a price for it because it has opened up the whole debate again.

I hope that Nova Scotia will have the Atlantic accord restored, but I do think it is going to cause other provinces to become more animated in the debate and to seek similar agreements. It is a shame the government ever tried to meddle with this.

With that, I will end my remarks. I hope that between now and the vote tonight the premier of the province of Nova Scotia and the Prime Minister of Canada find a way to restore the Atlantic accord exactly as it was negotiated and as it was signed on Valentine's Day 2005.

Budget Implementation Act, 2007Government Orders

June 12th, 2007 / 4 p.m.
See context

Calgary East Alberta


Deepak Obhrai ConservativeParliamentary Secretary to the Minister of Foreign Affairs

Mr. Speaker, it is a pleasure for me to rise to speak to Bill C-52. Before I start, I take exception to what the NDP just said, and that is the government has not taken British Columbia into account in the budget. Prior to that, we had a Liberal member stand up and talk only about Saskatchewan.

Those members of Parliament think the government is not addressing provincial issues. We are addressing provincial issues. We are addressing issues that affect all Canadians. This is their way of twisting the facts. That is how they want to do it. The actual fact is the budget is for all Canadians from coast to coast to coast. We disagree with the opposition parties, but that is their way it is.

The member from Saskatchewan talked about Saskatchewan and then he went on to talk about the Kelowna accord. I remind him that a short while ago the Prime Minister made a speech on how our new government would address the issue of land claims. What is interesting is the national chief was with the Prime Minister. This is what he said:

—today's announcement...is a positive response to what our people have advocated for decades, and it is a testament to the perseverance and dedication of our people.

By this statement, he is saying that the Liberals ran the country for 13 years and for 13 years they did nothing.

Since the Conservative government has come into power, it has taken action. We know the previous government was run by Mr. Dithers. The Conservative government is run by Mr. Action. The Prime Minister has shown commitment and action. He has given a firm direction of where we want the country to go. That is reflected in the budget.

Very clearly, this is a Conservative budget with Conservative values. This is not a Liberal budget that dithers on this side or that side.

What are the Conservative values in the budget? They are restoring fiscal balance, tax relief, debt reduction, investing for Canadians, preserving the environment, improving health care, supporting our troops, supporting our farmers and supporting our seniors.

The NDP and the Liberals of course do not support it or the things about which I have talked. They want to go down to their narrow, little agenda.

Let me talk about seniors. This is what CARP, an association for people who are 50-plus, had said. Again, after years of advocating when the Liberals were in power, nothing was done. Now they stand and cry indignation about all the things which they did not do. CARP says, “After years of advocating for the age at which RRSPs must be converted from 69 to 71, this has happened as well as income splitting”. CARP is saying that this is a good budget for seniors.

Let me talk now about tax fairness, income splitting and income trusts. The previous speakers did not address the issue of income trusts. Do they really think we could have the income tax burden moved from corporations on to the shoulders of ordinary Canadians? That is what would have happened. They do not want to talk about that. That is why the government was very firm, despite the fact that we had to change the rules on income trusts. We knew tax fairness was very important for Canada. The Conservative government stands for that.

Budget 2007 carries the Conservative policies, which are good for Canadians. It addresses issues that Canadians want. Of course we do not expect the Liberals to like this budget because they never did it.

What is really very funny about the Liberals is they argue about things as if they were never in power. It is as if they had nothing to do with the situation we are in today. However, the good thing about is the Conservative government is very forceful. We know where we want to go. The Prime Minister made it very clear in the election promise as to where our direction would go. That is strongly reflected in the budget.

When the Liberals and the NDP members vote against the budget, this is what they will vote against.

The budget is about tax relief for individuals and families. It is about tax relief for businesses. It is about money for infrastructure. It is about making Canada's economy stronger. It is about reducing federal debt. It is about post-secondary education and skills and training. It is about science and technology. It is about defence and public security. It is about preserving our environment. It is about investing in Canadians, improving our health care system and most important, restoring the fiscal balance for a stronger federation.

The main point is the budget is the firm direction, the firm road map to where Canada will go, after listening to Canadians. The budget is all about that. When the Liberals and the NDP vote against this, they will vote for what Mr. Dithers and the Liberals did for the last 12 years they were in power.

I sat on that side through three Liberal budgets and I listened to the Liberals. They had this whole beautiful budget that would make Canadians feel good because they would address all these issues. At the end of the day, most of the issues were never addressed.

I am very happy and glad that the new Conservative government will tackle those issues right.

Budget Implementation Act, 2007Government Orders

June 12th, 2007 / 3:30 p.m.
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Gary Merasty Liberal Desnethé—Missinippi—Churchill River, SK

Mr. Speaker, I am pleased to rise today to speak to Bill C-52. I am going to speak mostly from a Saskatchewan perspective.

I have heard a few things that I am quite disappointed about from my colleagues across the floor with respect to Saskatchewan. I want to break it down and talk specifically about some of the things that I think are drastically unfair when it comes to Saskatchewan's treatment under Bill C-52, the budget of Canada.

First of all, we have heard the Conservative members from Saskatchewan boast about the spending in Saskatchewan. I think this is quite misleading from the perspective that we have also seen increases in taxes to Saskatchewan. It is from that perspective that I am going to spend a bit of time.

First of all, we have seen that taxes have been raised in Saskatchewan by tinkering with the basic exemption. Most people in Saskatchewan unfortunately earn middle to lower income salaries. What the tinkering with the basic exemption has done is cause most people in Saskatchewan to pay more taxes at the end of the year. This is not good because it clearly does not help Saskatchewan. That is one issue.

Then we have the issue of the child tax credit. It is not available to lower income families because it is non-deductible. We have a demographic in Saskatchewan, the low wage earners, who probably need this type of supplement the most but they are virtually unable to get it because it does not apply to them. The group that needs it the most is denied it. Other tax credits are not available to low income people, and again they are being shut out, for example, spousal support and so on and so forth.

The tax regime is not favourable to the majority of Saskatchewan residents because the tax treatment they are getting at the end of the day raises their taxes and does not allow them to participate in a lot of the supposed investments that the government has announced in Bill C-52. That is a concern for a lot of people in Saskatchewan right now. It has been one tax year already, and they have seen at the end of the year that holy cow, they are paying more taxes than they ever did and that is not good. They cannot find places to reduce the tax grab from the government. They are not very pleased.

Then there is the income trust fiasco. A lot of people in Saskatchewan lost their life savings because of the flip-flop that occurred. The Conservatives promised they would not do it. People took them at their word and people in Saskatchewan have suffered. We should chalk it up as another attack on Saskatchewan. People lost their life savings, and they are not very happy about that. I certainly would not be happy. I know many people who have lost a lot of money because of that broken promise, which is just one of many broken promises.

Then there is the registered education savings plan. Again, it can be argued that by raising it and changing it in the way the government did it could be good, but lower income people could not even meet the original benchmark. The government raised it but what help is it providing to lower income people to allow their children to pursue their dreams, to obtain a post-secondary education, to pursue the careers they would like to pursue? In effect they have been cut out. They are not happy with that either.

The working income tax benefit does nothing for lower income people. It does not help them scale the welfare wall. They are kept in the situation they are in because lower income people cannot access the benefit. They are not happy with that.

The gist of my speech so far is that lower income people in Saskatchewan are being left out.

The GST cut is fine but not if one does not have the income to purchase, because it is a consumer tax. Most lower income people do not have the disposable income to make large purchases so they benefit very little from the GST cut of 1%. Again it is the lower income people who are left out in the cold. They are not happy. I get calls. I talk to people, I get phone calls, and I visit different communities. People ask why they are being targeted. It is not fair.

I guess one of the biggest things on which everybody in Saskatchewan agrees is that the Kelowna accord was virtually killed and gutted. In my previous statements in the House, I talked about how Saskatchewan's share of the Kelowna accord, if it were implemented fully, would have been approximately $600 million or $700 million over five years. This is money that would have been invested in that young aboriginal population, to mobilize them into post-secondary education, to mobilize them into the workforce, to invest in housing, to improve the quality of life for aboriginal people in that province. When they do well, Saskatchewan does well.

With the Kelowna accord we would have seen aboriginal people and non-aboriginal people in Saskatchewan walking hand in hand, prospering, taking advantage of the opportunities available for them. Saskatchewan is doing fairly well. Saskatchewan just moved out of a have not status to a have status. We are worried because we do not want to slip back. Resource revenue is just that; it is one time and once it is gone, it is gone. What is Saskatchewan to do? Saskatchewan needs to firmly establish itself so it never slips back into being a have not province.

With the killing of the Kelowna accord, not only did the Conservative government abandon the aboriginal people in Saskatchewan, it abandoned all people in Saskatchewan, because as I said, when aboriginal people do well in Saskatchewan everybody does well. They would have walked hand in hand. They would have prospered and been able to capitalize on the benefits that Saskatchewan has to offer its residents.

I guess one of the big issues over the last month has been the broken promise to exclude resource revenue from the equalization formula. Very clearly, a promise was made. The Conservatives very clearly have broken their promise to Saskatchewan.

My colleagues from Saskatchewan are feeling the pressure, and I do not blame them for feeling that pressure, not only from Saskatchewan residents but I am sure from all sectors. Saskatchewan media has chastised my colleagues from Saskatchewan for their lack of action to stand up for Saskatchewan, for trying to mislead Saskatchewan with irrational numbers which I heard today. As I said previously, the Conservatives give a new definition to the algebraic term of “irrational numbers” because their numbers simply do not make sense. They are trying to confuse and distract from their broken promise. Very clearly, a promise was made and a promise was broken. That is what people in Saskatchewan understand.

People in Saskatchewan may be misled once, but they will not be misled again. People in Saskatchewan do not like to be taken advantage of or taken for granted. Do this once and they will not let it happen again. People in Saskatchewan do not think that the government cares for them, and they are going to be voicing their displeasure through many and various means.

I talked about income tax being raised in Saskatchewan. My colleagues across said, “Look, we are putting some $250 million into Saskatchewan this year”. People in Saskatchewan are paying for that because their taxes have been increased. They are paying for it because they are not able to access the tax deductions that are made available to everybody else.

At the end of the day, people in Saskatchewan are paying for their own lack of funding from the Conservative government. At the end, it is zero. I would say there is a net loss at the end of the day to people in Saskatchewan because of the way the Conservative government has manipulated the numbers.

It is a shame to mislead the people in Saskatchewan, but it is more of a shame to take advantage of lower income people who work very hard to make a living in Saskatchewan. Instead, they see their taxes are being raised. They are being marginalized even more. They are being given no support and then there is the promise that has been broken. It is unfortunate.

Budget Implementation Act, 2007Government Orders

June 12th, 2007 / 3:25 p.m.
See context


Patrick Brown Conservative Barrie, ON

Mr. Speaker, I rise today to speak to Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007.

Bill C-52 is an economic plan that will reduce taxes for hard-working families, pay down debt and invest in Canadians' key priorities, like improving health care, protecting our environment and making our communities safer.

In my riding of Barrie, parents are faced with the daily financial challenges of raising a family. Bill C-52 offers parents a choice in child care by making it more affordable for families to raise their children. Bill C-52 includes a working families' tax plan. This plan has three components.

First, for families with children it includes a brand new $2,000 per child tax credit for children under 18 that will help families get ahead. A constituent of mine, Jennifer Woods from Lions Gate Boulevard, called me after hearing the news and told me how much this means to single mothers like her with three young kids.

Second, this piece of legislation would end the marriage penalty through an increase of the spousal and dependant amounts to the same level as the basic personal amount.

Third, it would help parents save for their children's education by strengthening the RESP program.

The bill would also help Canadian seniors by raising the age limit for RRSPs to 71 from 69 years, increasing the age credit by $1,000 and permitting pension income splitting.

Since being in power, the Government of Canada has introduced nearly $38 billion in individual tax relief over this and the next two fiscal years.

Our government has proposed to lower our national mortgage by $9.2 billion, on top of the $13.2 billion we have put against the debt since being elected. That is the equivalent to $700 in debt relief for every Canadian. Lower debt will mean lower interest payments, which will mean lower taxes. Through the tax back guarantee, every dollar saved from lower interest payments would be returned to Canadians through personal income tax reductions.

Bill C-52 also provides a total of $2.6 billion in new health care investments, as well as an increase in health transfers. This means our government will transfer $44 billion in health care funding to the provinces and territories over the next two years.

The Canada health transfer would provide $21.3 billion in 2007-08, or $1.2 billion more than in 2006-07, to support provincial and territorial health delivery. This would continue to grow by 6% annually to reach $30.3 billion in 2013-14.

This new health care spending is positive news for my riding of Barrie. According to Statistics Canada, Barrie is one of the fastest growing census metropolitan areas in Canada and for many years now we have been faced with the challenge of critical physician shortages and an overload of pressure on our local hospital, the Royal Victoria Hospital. The fund increase in health care by this budget would help hospitals like RVH by providing the provinces with more discretion to fund their needs.

Just recently it was announced that Barrie and Simcoe-Muskoka cancer patients will soon have access to Canada's first portable radiation unit at our local hospital. This new cancer treatment technology will begin to provide life-saving radiation therapy to hundreds of patients by this coming fall.

I want to specifically thank the Minister of Health and Dr. Rob Ballagh for first examining this concept last November. The announcement of this mobile cancer unit is an example of what increases in health care transfers to the provinces can achieve.

In addition to these transfers, Bill C-52 would provide $612 million to a patient wait times guarantee trust. For Ontario, this would translate into $205.4 million to the Ontario government for patient wait time reductions over the next three fiscal years.

Additionally, Bill C-52 would offer $30 million over three years for patient wait times guarantee pilot projects to assist the provinces and territories in implementing their patient wait time guarantees. Many Barrie residents will be positively impacted by this government initiative.

Since the introduction of the federal-provincial wait times strategy, the Royal Victoria Hospital has been a success story. Hospital procedures have been reduced by 19.6% for cataract surgeries, 17.9% for hip replacements, 11.8% for knee replacements, 25% for angioplasty, 23% for MRI exams and 13.6% for CT scans. Over $3 million has been directed to help RVH patients, and this has had a dramatic impact on our community.

We have seen an increase of more than 600 cancer, cataract and joint replacement surgeries performed at RVH, and more MRI hours of operation. The hospital has been able to increase MRI hours to 24 hour coverage on weekdays and extended hours on weekends. This means an additional 1,880 MRI hours for our hospital. I send kudos to the RVH management team of Scott Elliot, David Blenkarn, Janice Skot and Garth Matheson for using government resources so effectively to improve the health care in Barrie.

Another important priority that Bill C-52 addresses is the preservation of our environment. This includes $1.5 billion in the Canada ecotrust for clean air and climate change, the doubling of the number of environmental enforcement officers and the creation of a new national water strategy.

I am pleased that our new national water strategy commits $12 million over the next two years to support the cleanup of Lake Simcoe. This is one of the largest investments of its kind by the federal government in Canadian history to Lake Simcoe. These funds are a significant step toward preserving and protecting Barrie's beautiful waterfront, which is the heart of the city and brings the community together. Furthermore, these much needed funds will directly help residents in the community by creating clean and safe water.

Bill C-52 also takes action to make our communities safer. Many serious crimes that we read about today include gang activity linked back to the drug trade. Bill C-52 will launch a new national anti-drug strategy to combat the use of illegal drugs.

This legislation will also provide funding to protect children from online sexual exploitation and assist investigators in suspected cases of human trafficking. We have a great chief of police in Barrie by the name of Wayne Frechette. This is the type of action that the federal government should be doing to help and support our local police forces.

Budget 2007 is an excellent one for Ontarians. In fact, several leading provincial Liberals have sung its praises. Premier Dalton McGuinty said that it meant real progress for Ontarians. The Minister of Finance said that it contains some really positive elements for Ontario. The Minister of Intergovernmental Affairs said that it offers concrete results to Ontarians.

If Dalton McGuinty's provincial Liberals think that this budget is excellent for Ontario, that means it is a good budget for Barrie, for Ontario and for all of Canada. Perhaps the federal Liberals should follow their provincial counterparts' example.

Bill C-52 will help create a Canada that will make us proud to pass on to our children and grandchildren, a Canada with a standard of living and quality of life that are second to none. The Minister of Finance has delivered another balanced budget that builds a stronger, safer, better Canada by cutting taxes for working families, paying down the nation's debt and investing in the priorities of Canadians.

It is a good budget for my riding in Barrie, a good budget for Ontario and a great budget for Canada.

Budget Implementation Act, 2007Government Orders

June 12th, 2007 / 3:05 p.m.
See context

Regina—Lumsden—Lake Centre Saskatchewan


Tom Lukiwski ConservativeParliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, before question period, I was remarking that there was a number of myths and half-truths that had been propagated by members of the opposition today with respect to the budget implementation act, Bill C-52.

I pointed out that in contrary belief to what the member for Wascana had been advocating, we in fact had spent more days debating this bill than the last two budget implementation bills brought forward by the member for Wascana, when he was minister of finance. To suggest we are not giving adequate debate is absolutely a fallacy.

Let me point out two more points before I sit down and entertain comments and questions with respect to equalization and the formula respecting Saskatchewan.

One of the other fallacies is that members opposite, as well as the Premier of Saskatchewan, suggest that Saskatchewan will get no equalization money next year because of changes made to the equalization formula. That is an absolutely untrue statement. The reason Saskatchewan will receive no equalization dollars next year is because it does not qualify for equalization. Its economy is red hot. It is the third fastest rising economy in Canada. The Premier of Saskatchewan, as well as the public of Saskatchewan, should be proud of that.

Here is one thing that is true. If the previous Liberal government were in power today, Saskatchewan would receive no money in equalization this year. Why? Because the position of the Liberals is not to remove non-renewable natural resources from the equalization formula and, on top of that, put a fiscal capacity cap.

The member for Wascana said that it is not true. These are words echoed by his own leader a month ago on the Mike Duffy Live show. We can check the transcript or the film. He stated that he believed there was no equalization receiving province that should have money that would result in a fiscal capacity higher than a province that paid into it.

Saskatchewan is far better off under a Conservative regime than it ever would be under a Liberal regime.

The House resumed consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the third time and passed, and of the motion that this question be now put.

Third ReadingBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 1:50 p.m.
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Regina—Lumsden—Lake Centre Saskatchewan


Tom Lukiwski ConservativeParliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, it is indeed a pleasure to speak in this chamber today to Bill C-52, the government's budget implementation bill.

I am particularly pleased to speak because I want to ensure I have the opportunity to dispel some of the half-truths and outright fallacies being propagated in debate, particularly today, by members of the opposition.

The first thing I want to talk about is the complete untruth that somehow we have been stifling debate on this important bill. We have heard it from the member for Wascana and the member for Vancouver East. They have consistently stated that the motion we brought in for time allocation today was an attempt to further curb debate on this very important bill. I assure members that is the furthest thing from the truth.

In fact, I point out, particularly for the members opposite, we have so far debated Bill C-52, this year's budget implementation bill, for 15 days. On the last two budget implementation bills presented by the previous government, now the official opposition, in the two years combined, the government had only allocated 14 days debate between the two years. In other words, to put things in context, we have spoken more days on this one bill than the last two budget implementation bills by the previous government combined.

For them to say that we have been curtailing debate is an absolute fallacy. Nothing could be further from the truth.

Now that we have that settled and put it to rest, let us talk about the bill itself and some of the benefits that apply to Canadians.

In particular, we know now that the fiscal imbalance situation, a concept that the previous government, and the leader of the official opposition in particular, failed to recognize, has been put to rest. More money has been paid to provinces in the form of transfers, whether they be health transfers or post-secondary education transfers, than has ever been done before, and we are very proud of that.

In addition, we have brought in initiatives to help families with child tax credits. We put money toward infrastructure. We put money toward a biofuels industry. We put money toward agriculture to help our farmers who have been suffering a decade long of income crises, from one crisis to another. We have provided Canadians from coast to coast to coast with a type of budget, presented by the type of government, that they deserve, for the first time in 13 years.

What I really want to talk about in the few moments I have before we get into question period is the question that has been predominating the airwaves today, and that is, the entire topic of equalization, whether it be the Atlantic accord or equalization as it sort of plays itself out with all the provinces besides Newfoundland and Labrador and Nova Scotia. I will give a particular perspective and insight into what it has been doing to Saskatchewan because Saskatchewan has been unfairly portrayed as a province that has been hurt by the new equalization formula changes.

Again that is, at best, a half-truth, and I would suggest a complete fallacy if members really want to know the truth. Saskatchewan has not only resulted in receiving $878 million in new money, which is a $230 per capita payment, the highest of any province in Canada, but the changes we have made to the equalization formula itself are actually there to protect Saskatchewan in an essence of fairness across the board.

Let me explain what I mean by that.

The changes we have made in budget 2007 to the equalization formulation are, as promised, 100% removal of non-renewable natural resources after extensive consultations with the provinces. Both of those elements we talked about in the election platform. We promised to make those changes, and we did.

Now the question seems to be, particularly for members opposite, is that somehow we treated the province of Saskatchewan unfairly because we put a fiscal capacity cap on the formula.

Let me just say what a fiscal capacity cap is all about. This is nothing more than something that maintains a convention that has been in effect with the equalization program for the last 50 years.

Since equalization was first announced in Canada in 1957, and later enshrined into the Constitution in 1982, there has never been an instance in those 50 years where a province that receives equalization payments ends up with a higher fiscal capacity than a province that has paid into the program. Why is that? It is a matter of absolute fairness. Because the name “equalization” means simply that all provinces should have equal abilities to deliver services at relatively the same level of taxation.

This program is not intended to make a have not province richer than a have province. In fact, I point out that had the program, which introduced in budget 2007, been in effect in the 1990s, when Saskatchewan was considered a have not province, Saskatchewan would have received an additional $4 billion in revenue.

These figures are not my own making. These figures come from the department of finance in the province of Saskatchewan. Why is that? Because with a have not province, at least in the particular case of Saskatchewan, the $400 million a year that it would have received over that decade would not have put its fiscal capacity higher than that of Ontario. In other words, Saskatchewan would have received 100% of all the benefits flowing from their non-renewable national resource revenue.

What happened? Why did Saskatchewan not receive it? Because the previous Liberal government did not address the equalization program, even though there were repeated calls from the province of Saskatchewan to consider at least removing non-renewable natural resources from the formula. The previous Liberal government did absolutely nothing.

The member for Wascana is proud to stand in the House and say that when he was the minister of finance, he gave close to $800 million in his last budget to the province of Saskatchewan, and he did. Why? To try to redress all the inequities hoisted upon Saskatchewan for the previous decade.

Even with that $800 million, he was woefully short of treating Saskatchewan fairly. As I mentioned just a few moment ago, had the provisions we have placed in budget 2007 been in place during the 1990s, Saskatchewan would have received $4 billion in additional revenues.

Unless the member for Wascana commits to coming up with another $3.2 billion to give to Saskatchewan, what he did over 13 years amounts to absolutely nothing in terms of fairness. What we have done is redress that. We have made the equalization formula not only principled, but fair to each and every province.

I hear a lot of chirping on the other side and them saying “not true”. It absolutely is true. The member for Wascana knows it. I know it. I hope the people from Saskatchewan know it as well.

That is not the only thing these changes have done in terms of equalizing and ensuring that the equalization formula is more professional and a principle based program.

I understand that we have to go to question period. I will have a few moments left after question period and I look forward to continuing this discussion then.

Third ReadingBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 1:20 p.m.
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Rahim Jaffer Conservative Edmonton Strathcona, AB

Mr. Speaker, I am very proud today to rise in the House of Commons and have the honour of speaking on Bill C-52. Unlike the previous speaker, I will focus on some really positive initiatives that I think Canadians are very proud of when they look at our government.

Once again, I am proud of the excellent work that the finance minister has done in constructing a budget that meets the needs of ordinary Canadians. Our budget package provides a plan that will aspire to create a stronger, safer and better Canada. This will be achieved through restoring fiscal balance, reducing the tax burden on working families, investing substantially to protect the environment, and promoting our health care system.

In communicating with my constituents from the riding of Edmonton—Strathcona, I have received tremendous support for this new budget. Edmontonians feel confident that Canada's new government is continuing to speak to their needs by providing a focused fiscal agenda, something the previous Liberal government failed to do for 13 years.

Specifically, budget 2007 speaks directly to the students at the University of Alberta, to business owners and entrepreneurs on Whyte Avenue, and to ordinary parents and grandparents who put a premium on family. It is these individuals who get up every morning and go to school and to work in order to better their lives and those around them. Canada's new government wants to help them be successful.

In the past, the previous government sought to impose one size fits all solutions for very real problems. Our vision is different.

Canada's new government does not claim to have the answer to every problem or to be better prepared to address all the problems ordinary Canadians have.

Canada's new government is willing to listen to Canadians, get an understanding of their issues and provide them with the resources necessary to achieve their goals and realize their dreams. That is what Canada's new government has done and what Canada's new government will continue to do.

Students at the University of Alberta will benefit exponentially from the money allocated in this year's budget. Building upon the targeted tax relief outlined last year, budget 2007 will invest substantially to improve Canada's post-secondary education system. Our government will allocate $1.3 billion to science and technology research, coupled with a 40% increase in funding for Canada's post-secondary institutions.

In addition, budget 2007 outlines 14 supplementary monetary investments that will specifically target areas of R and D, employment training and post-secondary scholarships. All of these investments will ensure students at the University of Alberta are receiving a world class education and the necessary skills to compete in a globalized economy.

I am proud to say that Canada's new Conservative government has once again delivered for students.

Students graduating from university, technical schools and other institutions of higher learning want to know that employment will be attainable immediately upon graduation. That is why budget 2007 proposes a number of measures that will enhance infrastructure and the necessary resources for business to succeed.

For example, a small business owner on Whyte Avenue in my constituency can expect to benefit from the government initiative to reduce the paper burden by 20%. Less time will be spent on excessive government red tape and bureaucracy, and more time can be spent on driving the economy, thus creating jobs.

Furthermore, the capital gains tax exemption for small business owners will be increased to $750,000 from $500,000. Undoubtedly, this will help business people in Edmonton--Strathcona reap additional benefits from their investments.

Additionally, budget 2007 speaks to the needs of ordinary families across Canada and in my riding of Edmonton--Strathcona. Since taking office, our government has always made working families a number one priority and I am proud that we have proven that once again in this budget.

Working families in my riding can expect to receive a new $2,000 per child tax credit for children under the age of 18, along with the elimination of the marriage penalty on single earning families.

Additionally, Canada's new government also wants to help parents save for their children's post-secondary education. That is why the Minister of Finance has transformed the RESP program to allow parents to contribute more on a yearly basis and has increased the lifetime contribution limit. Education is important to Canada's new government and we want to help parents help their children to succeed.

Finally, budget 2007 sets out comprehensive funding to reduce greenhouse gases and improve air quality. Undoubtedly this is something that will benefit all Edmontonians by making a cleaner, healthier environment.

Some examples of these environmental initiatives include: rebates of up to $2,000 on new fuel efficient vehicles; investments in biofuels; the $1.5 billion ecotrust to help clean up our land and water; $22 million to enforce environmental protection laws; and, of course, a new national water strategy.

In closing, I would like to say that the government cannot spend Canadians' money better than they can spend it themselves. This budget recognizes that Ottawa can do more with less and Canadians can do more with more.

I am delighted that my constituents finally have a government that recognizes the need to support them in their choices by giving them more resources with which to shape their own future.

In short, by offering a broad based fiscal plan that targets their specific needs, budget 2007 will make a difference in the lives of Canadians and particularly the lives of people in Edmonton—Strathcona.

I cannot emphasize enough the fact that I have heard from so many people who are pleased to see a focused fiscal plan. I have had a number of phone calls and emails over the last number of weeks and months since the budget was tabled in the House, with particular examples of how families feel that the government understands their concerns and needs. In particular, there is a breadth of knowledge and there is the diversity of my riding, with Canadians who range from seniors to students to business owners. They all feel that this budget was very focused in its delivery and that it aims to help a number of them.

In particular, I will emphasize the University of Alberta. It is clear from the work done in the previous budget and then in this budget that we can see the support this government is giving to the future, particularly when we see what is happening in Edmonton and in Alberta with their current economic growth and the challenges we are facing in managing that growth. This government has implemented a number of measures to support that growth and to build on it to enhance what is happening with all the growth in Alberta.

I think back to the last budget when we made simple changes that were never made by previous governments, one being to allow foreign students the chance to work off campus. So many of them come to this country looking for new opportunities.

My family still operates a small business, as members know. I had very humble beginnings before I came to this place. I ran a small business on Whyte Avenue for a number of years. A number of our family members and others benefited from this change last year, especially in a really hot labour market where we have had a challenge in finding and retaining people.

Now we are able to have that opportunity for students who are looking for new or better opportunities in coming to Canada. Not only is it an opportunity for them to make the most of their education, but it is also an opportunity for them to then afterwards get value from that education by being in the Canadian workforce. Hopefully many of them will decide to remain here in Canada and we will benefit from those skills.

Our government even has opened up the opportunity for them to be able to look at staying here. Unfortunately, the previous government talked a lot of talk when it came to immigration opportunities and supporting students, but it really delivered very little. That seems to be the legacy of the previous government. That is something we wanted to change when we took office.

We have had a Prime Minister and a finance minister with clear leadership. When they put certain directions or changes on the table it is to deliver real results. Not only have we seen that in the budget, but we have seen environmental changes put in place. The previous government's record is unacceptable. As I mentioned earlier to the member for Richmond, a 33% increase in emissions under the Kyoto protocol is not real results. We are looking to improve air quality and the health of Canadians in working with them to implement those changes.

That is why many of the changes we have implemented in budget 2007 will help to actually integrate Canadians in working with their governments and helping shift behaviour. Those changes will benefit Canadians in the long term with real results, something that has been missing in this country for a number of years. That is the type of feedback I am getting from my constituents, who are proud to see a government and a finance minister with the vision to lead, for a change, and not follow.

Third ReadingBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 12:50 p.m.
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Blackstrap Saskatchewan


Lynne Yelich ConservativeParliamentary Secretary to the Minister of Human Resources and Social Development

Mr. Speaker, it is a pleasure today to address Bill C-52, the budget implementation act . It seems the Liberals and the NDP have been unable to imagine a better, safer and stronger Canada, which budget 2007 has asked us to aspire to be.

The constituents of Blackstrap get it. They can envision that Canada and they have embraced the budget. In fact, the budget is well received throughout Saskatchewan, where it largely is seen as a blueprint for better and more prosperous times. It has not hurt that Saskatchewan is a big winner in budget 2007. It is receiving the largest per capita gains of any province with the new fiscal balance package.

I do not believe there has ever been a better budget in Canadian history that has been subjected to such a barrage of misinformation, blatant partisan criticism and wholesale misrepresentation.

For instance, almost three months after the release of the budget, members of the opposition in the House of Commons as well as members of the Saskatchewan NDP government continue to claim that the government has failed to keep its promise to Saskatchewan to exclude non-renewable resources from the equalization formula.

That erroneous information has been repeated so often by so many politicians and written in so many political commentaries that it has been endowed with a sense of truth, but nothing could be further from the truth. The government has kept its promise. The Prime Minister has kept his promise.

Saskatchewan Conservative MPs are voting for the budget because the budget delivers for Saskatchewan. I have made my support of the budget very clear in the House, in letters to the editor and in columns published.

The budget gives us none of us any cause to worry. For those of us in Saskatchewan, the budget is about the tale of two leaders.

The first is of the Prime Minister, a visionary who had the courage to solve the fiscal imbalance and determine an equalization formula that is fair to all provinces, based on a 10 province standard.

The other is of the Premier of Saskatchewan, a standard politician who has spent $300,000 on a provincial advertising campaign called “Imagine”, but lacks the vision to see his province move beyond a have not status. He is a critic for criticism's sake. He will not embrace the future because he is too attached to the past. Partisan to the end, he will not acknowledge a promise kept by his political opponent, so he insists a different promise was made.

First, the government has kept its promise. Saskatchewan can exclude natural resources in the calculation of equalization revenues. The Finance Minister further clarified the equalization formula when he first reminded people that our government did not negotiate side deals with any individual province or territory and that we could not run the country on side deals.

Second, the federal government is currently consulting, not negotiating, with Nova Scotia about the implementation process and the benefits of budget 2007 to determine the process of maintaining our guarantee that no province will be worse off under the new system.

Our government is not in the midst of making any side deals for political expediency. Equalization has been restored to a principles based program for the first time in many years. Equalization has been restored to a truly national program. That is what all premiers asked us to do and that is what all Canadians expect us to do.

Restoring fiscal balance brings federal support for Saskatchewan to $1.4 billion in 2007-08, including over $800 million in new funding. That is more new funding on a new per capita basis than any other province.

Under the old Liberal equalization program, Saskatchewan would have received zero dollars this year. Under budget 2007's new, strengthened equalization, it will receive $226 million per year. That is more now than it had before to fund health care, education and other important public services.

It was that self-proclaimed defender of Saskatchewan, the member for Wascana and former finance minister, who began this ad hoc process of doing side deals with some provinces and not others in 2005.

To set my position straight, I always believed in a fair, principled transfer to all province. Saskatchewan never sought special treatment; just a fair deal. I believe the Prime Minister worked out a fair deal for all provinces, including Saskatchewan.

It is a sad day for Saskatchewan when the NDP premier suggests the government has not kept its word to Saskatchewan. Not only did he choose to misrepresent the situation, but he chose to wage his war in the media with sound bites, clips and one-liners that were less representative of the truth. When dealing with an issue as complex as equalization, a little more substance, time and debate is required.

At first the premier insisted that Saskatchewan had been forced to include non-renewable resources into the calculation of its equalization. Then when that was revealed to be false, he insisted that a cap on equalization dollars was never envisioned. A fiscal cap was always envisioned because the very concept of equalization implied a cap.

We cannot have equalization without a cap because the level of equalization would constantly rise and equalization receiving provinces would then develop a level of prosperity beyond that of provinces not receiving equalization. Some provinces would be more equal than others and the levels of have not provinces would exceed that of have provinces and have provinces would then expect equalization funding.

The no cap argument is absurd. Only because it remains a dominant news story and the opposition's favourite criticism of the budget, it is worth examining the history of equalization in Canada.

Canada's equalization program has been in place since the mid-1950s. It has always been and continues to be a complicated formula. While many changes have been made throughout the program's history, the basic approach involves assessing the fiscal capacity of provinces to deliver public services.

Equalization provides unconditional transfers to less well off provinces to assist them in providing services to local citizens. Checks and balances have always been built into the formula. Measuring the fiscal capacity of the provinces and ensuring the formula is figured out fairly and equally between the provinces is where the term cap originates.

Why Premier Calvert claims he is surprised about the cap is unclear. In the pre-2004 equalization formula, before the member for LaSalle—Émard's government went to its ad hoc ideal approach, there always were internal checks and balances to ensure that equalization payments did not lift have not provinces to a higher total fiscal capacity than contributing have provinces. This would not be fair.

The pre-2004 budget was based on the fiscal capacity of only four provinces: Ontario, Quebec, Manitoba and British Columbia. Due to its volatile economy, Alberta was taken out of the old formula to make calculations more viable. Since 2004, the federal approach to equalization was ad hoc, involving side deals for certain provinces. The provinces, collectively, with the Council of the Federation's provincial body, called for equalization review and reform.

The provinces wanted a new formula based approach, a 10 province standard and a predictability of funding. Therefore, the finance minister was not exaggerating when he described this budget as historic. Our government has taken equalization payments in a historic new direction, which includes a new formula with a principled 10 province standard. It is stable, it allows for long term planning and a seven year framework and it is exactly for what the provinces, including Saskatchewan, were calling.

However, the Saskatchewan premier seems not so much protective of equalization dollars as he is addicted to them. He is utterly afraid of his province ever achieving a have status and not requiring equalization dollars to meet priorities. He seems unable to perceive Saskatchewan growing beyond his limitations. In fact, the former Saskatchewan finance minister recently revealed his government needed equalization dollars to higher provincial civil service salaries.

No wonder the StarPhoenix in Saskatoon today reports that the highest paid Saskatchewan crown corporation executive actually lives in Vancouver. He receives an annual salary of $313,000.

What is going on in the front pages of our news in Saskatchewan has been analyzed by the Atlantic Institute for Market Studies. It has examined the provincial public services across Canada and has found that many use equalization to inflate the size and wages of their public services. AIMS has found that in Saskatchewan, for every 1,000 of population, 109 are public servants. In fact, it is the highest ratio per capita in Canada. Statistics Canada says that Ontario gets by with 67 per 1,000 and Alberta with 73.

That is where the extra money is going and that is why Saskatchewan is closing schools. Rural taxes for schools are very high, and the provincial government is closing schools every week. Schools there are the heart and soul of our communities in Saskatchewan. Meanwhile its population continues to decline drastically. The leader of the Saskatchewan Party was recently quoted as saying that since 2001, Saskatchewan's population declined by 10,000 residents, the size of Weyburn, Saskatchewan.

In 2004 the Saskatchewan Chamber of Commerce pointed out that the labour laws did not help us either. The chamber reported in its publications that Saskatchewan's labour standards act had not been amended since 1995 and pointed to labour laws as a provincial barrier to growth.

The budget is all about fixing fundamental problems and meeting fundamental needs. Budget 2007 invests in families, seniors, small business and farmers and it puts Saskatchewan at the forefront of a revitalized stronger Canada.

Third ReadingBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 12:35 p.m.
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Robert Thibault Liberal West Nova, NS

Mr. Speaker, I am pleased to rise in this House to discuss the federal budget again and to raise a few other points.

It is unfortunate that so few members have the opportunity that I have today. The time allocated to a debate on a very important aspect of government has been limited. How will programs be implemented? How will services be provided to Canadians? I believe these questions deserve a good debate and some good discussion.

I have the honour to be a member of the House Standing Committee on Finance, where the Conservatives wanted to eliminate the opportunity for Canadians to appear before the committee to share their opinions on budget 2007. I found that most unfortunate.

We had to negotiate to bring even a few people before the committee, and even then, their testimony was restricted. For example, Premier Calvert was given only a few minutes despite having been promised a whole hour.

What has been interesting to me in this debate today is not the question of whether or not this budget represents a betrayal to Canadians. The only discussion has been on what is the biggest betrayal. Is it the income trusts or is it the Atlantic accord? What is it? The fact that there are so many betrayals is very worrying and the fact that nobody can argue that Canadians have not been betrayed.

The government has flip-flopped on the issue of summer jobs. What bothers me is not the fact that the government has flip-flopped. It is the fact that there are some issues that it refuses to flip-flop on because it comes out instinctively with an incompetent position, which causes us to fight all the time within committees and within this House to get the government to understand and to get the item out in public so the government will be forced to retract its position or improve it.

We have mentioned many examples in the House of government flip-flops but I will name one that might not get much attention. There is a small area of the scallop fishery in my province called area 29. There has always been a huge debate as to who would fish there. Is it the inshore? Is it the Full Bay? Where does the Full Bay begin? Where are the offshore scallop taken? It has taken a long time to come to some accommodation.

When I was minister of fisheries, we came to an agreement on sharing within area 29 between the Full Bay fleet and the inshore fishermen. Having been asked by the Full Bay Scallop Association to maintain the current position, a letter was sent saying that the current sharing formula would be maintained in area 29. A few days later we found out that the minister was appointing a panel to revisit the allocations in that area, again causing consternation within the fleets. This is another example of the government's flip-flops. It is perhaps not one that gets national attention, but it is one that is very important and symptomatic of what we have seen.

We have seen cuts to summer jobs which has hurt little community organizations that need summer students to operate. Thank goodness for the work of the member for Dartmouth—Cole Harbour who brought this to the floor. All Liberals MPs worked very hard with him and we were able to get the Conservatives to retract on that . However, we are still not sure of how we will do in future years. This year the cut was only $11 million, and we saw the impact of that. Next year the government is forecasting a cut of $59 million. What will that mean?

Foreign investment is another issue on which the government has flip-flopped. The government came out with a knee-jerk reaction in the budget saying that an individual could not deduct for tax purposes any interest expense for investments outside of Canada. The government knee-capped Canadian industries that must compete internationally with other companies. It is a global market out there. We had to embarrass the Conservatives at committee to force them to retract on that decision.

Now the government is talking about stacking and about double-dipping. Nobody wants any corporation, Canadian or otherwise, to evade taxes but it is important that our corporate sector become competitive internationally. We worked very hard on that.

The issue of income trusts has been discussed many times. There is no doubt in my mind that we had to take action in that sector because there were problems. The Governor of the Bank of Canada pointed that out very well at committee, as did many others. He also said that it was an excellent vehicle for certain sectors of the economy and that there was a demand for that type of investment in the capital markets.

Rather than solving the problem, the Minister of Finance came out with a nuclear bomb, when a surgical strike would have been appropriate, and completely crushed the whole sector, eliminating $25 million of capital savings of mostly seniors across this country. He killed a very important sector and caused these companies and corporate assets to be sold abroad. The minister had an opportunity to retract and make changes. The member for Markham—Unionville made an excellent proposal that was adopted by the committee that would have solved that problem.

I have also mentioned the issue of the Digby wharf in the House many times. For over a year and a half now the government has had the arbitrator's report. It knows that the error was an error by the Department of Transport. It is not a huge amount of money on a national basis to solve the problem and give this port back to the people where it belongs.

I want to spend a bit of time on the question of the Atlantic accord, which is a huge betrayal because, like income trusts, the Prime Minister promised not to touch it. Further, when the Conservatives were in opposition they were so in favour of the Atlantic accord that they wanted it split from the full budget so they could vote in support of that element but not in support the entire budget.

In last year's budget, the government sent out a message that it did not like the Atlantic accord and that it was not very well received in certain parts of the country. We could debate that. We could debate as to the value of that type of an agreement between the provincial and the federal government or special agreements with any province, but that is not a matter to debate. That debate happened in the House a year and a half ago and the Conservatives agreed to it. An agreement was signed between the federal government and two provinces and that agreement should be honoured.

A promise was made by the Prime Minister to the people of Saskatchewan and that promise should be honoured. A promise was made in the campaign by the Prime Minister to the people of Atlantic Canada that the accord would be maintained, and that promise should be honoured.

It is those flip-flops and betrayals that we object to and the way that people are treated.

We had the member for Central Nova stand in the House, when I questioned him before the first vote on the budget, saying that if Nova Scotians did not like the budget that he would see them in court. We thought that was some buffoonery until yesterday when we heard the Prime Minister make the same challenge, so we now know that it is the position of the Government of Canada.

While the Minister of Finance said that we would have peace in our time and that the bickering between the federal and provincial governments is over, the Conservatives have now gone fully 100% to the American way and the judiciary can resolve all these discussions. We will sue one another rather than discuss and negotiate.

We then had the same highly placed minister of the government stand in this House and say that there would be no whipping, no flipping, no hiring, or firing and that no member of caucus would be expelled for voting his or her conscience and voting against the accord. The member for Cumberland—Colchester—Musquodoboit Valley did not have a chance to make it to the curtains after he showed courage by voting in favour of the people of his province before he was expelled from his caucus.

What does the member for Central Nova, the Minister of Foreign Affairs, say in the media after that? He said that he did not think anyone would vote against the budget. He did not mind misleading the House because he thought no one would take him up on it, no one would make him show his cards. Well, one member had the courage and we now know what I believe is an egregious misleading of the House by a member saying that there would be a free vote when there was not.

We then heard from members within the Conservative caucus that they had to stay within caucus because they were negotiating and trying to find accommodation between the federal government and the accord provinces and that the discussions were ongoing.

On Saturday, in the Chronicle-Herald in Nova Scotia, we see a letter signed by the Minister of Finance of this country saying that no such discussions were happening, that it was impossible and that there could not be some discussions. What is more, we learned that the Prime Minister's Office had written a letter and tried get the member for Central Nova to sign it, which would have been a complete suicide note.

However, I want to help the member for Central Nova, the member for South Shore—St. Margaret's and the member from Newfoundland to find a resolution to this problem. I want to give one last opportunity to the Conservative government to honour its accord. Therefore, I seek unanimous consent of the House for the following motion: That the previous question on Bill C-52, the budget implementation act, 2007, be deemed withdrawn and that the bill be recommitted to the Standing Committee on Finance for the purpose of reconsidering those clauses dealing with the Atlantic accord and equalization.

Third ReadingBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 12:10 p.m.
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Joy Smith Conservative Kildonan—St. Paul, MB

Mr. Speaker, I rise today to speak on this budget that is so important to Canada and so important to my riding of Kildonan—St. Paul and indeed to Manitobans.

Our budget will reduce the tax burdens on working families, and this budget will protect our environment and modernize our health care system. This is a very important budget that has to be passed by the end of this month. I must say that this government will provide equal treatment to Canadians and this is what this budget delivers.

Through budget 2007 we are providing the provinces and territories with well over $39 billion in additional funding to restore fiscal balance in Canada. We are returning equalization to our principled, formula-based program. I would like to take a moment to talk about how this does apply to my province of Manitoba.

Restoring the fiscal balance will provide Manitobans with $3.1 billion in 2007-08 and this includes $1.8 billion under the new equalization system. It will provide Manitobans with $807 million under the Canada health transfer. It will also provide Manitobans with $350 million for Canada social transfers including additional funding for post-secondary education and child care, and $83 million for infrastructure.

I would like to ask my fellow members of Parliament and the opposition to support Manitoba. I would encourage them to listen to Manitobans. Even the premier of Manitoba said this federal budget contains good news for our province and I would encourage the NDP members from Manitoba to do what is right for the people of Manitoba and support this important budget.

The NDP premier of Manitoba said, “So, I actually think the compromise is supportable by Manitoba. I think that it is difficult to get 13 separate leaders of provinces to agree on a perfect solution. And I think the consensus in the report that was produced by the former Liberal government, acted upon by [the] Prime Minister, is the appropriate way to go. And it treats hydro at least equally to oil and gas. And from that perspective I disagree with the member from Nova Scotia and his position, and I agree with [the] Prime Minister in his position”.

Here in the House we have NDP members of Parliament who are opposing this budget and complaining about it. The fact of the matter is the NDP premier of our province fully supports it. It is obvious that we have to look at what this does for our province.

We believe that paying down the national debt is important for Canadians and our government is lowering our national mortgage by $9.2 billion on top of the $13.2 billion we have put against the debt since elected. This is equivalent to $700 in debt relief for every individual Canadian. Through our tax back guarantee, lower debt will mean lower interest payments which will mean lower taxes. This is a good start because we believe as a government that Canadians pay too much tax.

In my riding of Kildonan—St. Paul parents struggle daily with the challenge of raising a family. With higher costs of living, housing and energy, it is not easy. We need to make it more affordable for people to have children and to raise them. As a result we have created a working families tax plan and that is important to families all across our nation.

It has four components. First, for families with children it includes a brand new $2,000 per child tax credit for children under age 18. That will help families get ahead. This will save families in Manitoba $54.1 million.

Second, we are ending the marriage penalty through an increase of the spousal and dependant amounts to the same level as the basic personal amount to provide up to $209 of tax relief to a supporting spouse or single taxpayer supporting a child or relative, saving Manitoba residents an estimated $8.4 million. This is a lot of money.

Third, we are helping parents save for their children's education by strengthening the RESP program. As the mother of six children all of whom have gone through university, I know what this means to Canadian families and to Manitobans.

Fourth, we are helping seniors by raising the age limit for RPPs and RRSPs to 71 from 69 years to save Manitoban taxpayers $1 million. This is getting direct results for hard-working Canadians.

Welfare is a difficult situation many Canadians face. Too many people feel trapped on welfare. A single mother with one child who takes a low income job can lose almost 80 cents of each dollar she earns because of higher taxes and reduced benefits for drug and dental coverage.

To help people get over this welfare wall, we are investing more than $550 million a year to establish a working income tax benefit. This measure will help remove barriers that discourage people from enjoying the dignity and independence that comes with a job. This new working income tax benefit of up to $500 for individuals and $1,000 for families will reward work. It will strengthen incentives to work and will benefit Manitoba workers to the tune of $18.9 million.

I would like to remind the member for Winnipeg North what she said about the working income tax benefit. She said:

It's an important program that goes in the right direction.

I would hope that this means she will be supporting this initiative and supporting the budget. This budget is very important. It has to be passed by the end of the month or a lot of people will miss out.

The budget includes a new long term plan for infrastructure that delivers $33 billion over the next seven years. There is an estimated $17.6 billion in base funding which consists of the gas tax fund and the increase from 57.1% to 100% in the rebate that municipalities receive for the goods and services tax they paid in 2007-08.

Base funding for Manitoba is forecast to be $46 million. The Government of Canada is providing $26.8 million of gas tax funding for municipalities in Manitoba in 2007-08. This is very important to Manitobans. There have been so many plans in terms of the infrastructure advantage from this government that really benefit Manitoba.

Manitoba will benefit from the enriched $1 billion Asia-Pacific gateway and corridor initiative. The Red River floodway is very important to the province of Manitoba and in preventing the flooding of the city of Winnipeg. There is a recent federal commitment of $170.5 million to complete the expansion of the Red River floodway. This will enhance the level of protection enjoyed by the residents of the city of Winnipeg. Members will remember that there was a very big flood a few years back which threatened the whole city.

Preserving and protecting our environment is a priority for our government. We have made tremendous strides in this budget.

In order to protect Lake Winnipeg, the Red River and other Manitoba rivers we are establishing a new national water strategy. It is all centred on the budget that needs to be passed by the end of June. This national water strategy will improve municipal sewer and water facilities.

The new Canada ecotrust for clean air and climate change will provide support to those provinces and territories that identify major projects, as we have done in Manitoba, that will result in real reductions in greenhouse gas emissions and air pollutants. Canada's new government intends to provide Manitoba with almost $54 million through this initiative. Water quality in Lake Winnipeg has deteriorated. This budget will provide $7 million over the next two years to Environment Canada in our province.

Unless Bill C-52, the budget implementation act, is passed in the House of Commons and Senate by June 30, the critical funding for Manitoba and for my constituency will be lost.

When elementary schools, such as Bird's Hill School or Maple Leaf School in my riding, write letters about their concern for the environment, how would I explain to students, our country's future leaders, that $54 million to reduce greenhouse gas emissions and air pollution was lost because opposition parties in the House of Commons voted against the bill? At my next seniors round table discussion at Donwood South or Carriage House North when one of my constituents asks why parliamentarians gave up $27.9 million to help reduce patient wait times in Manitoba, how would I explain that?

Without that funding, how do I explain that we are working toward ensuring that all Canadians receive essential medical treatment within clinically acceptable wait times? And what about the over $21 million for labour market training? All this money will be lost. It is critical that the games in this House of Commons stop and that the opposition parties get on board.

The population in my province of Manitoba is waiting for this budget to pass. They look forward to the passage of this budget. The future of this budget is in the hands of parliamentarians here today on Parliament Hill. It behooves us to be responsible and pass this budget and see that Manitobans get that money.

Third ReadingBudget Implementation Act, 2007Government Orders

June 12th, 2007 / noon
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Blackstrap Saskatchewan


Lynne Yelich ConservativeParliamentary Secretary to the Minister of Human Resources and Social Development

Mr. Speaker, I would like to comment and maybe correct the record a little bit. The member who spoke said that the Liberals were so interested in seeing this bill pass and that we are creating obstacles.

I want to remind him that between the calling of Bill C-52 at second reading on April 23 and May 4, we debated the Excise Tax Act, we debated the senate consultations, we debated the firearms offences, we debated the age of consent, and we debated dangerous offenders. We had the Liberal opposition day on residential schools. We had the NDP opposition day on Afghanistan. We had the Bloc opposition day on greenhouse gases.

After the bill was introduced on March 30, for four consecutive days the Liberals had all the time and spoke relentlessly. For four full days the debates were ongoing. As most government bills do, we allowed them to debate the bill for four full days.

How can he say that they showed signs of passing this bill when in fact they showed no signs? They were always creating obstacles in debating this very important budget bill. I would like the member to comment on where he is coming from.

Third ReadingBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 11:50 a.m.
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John McCallum Liberal Markham—Unionville, ON

Mr. Speaker, I would like to focus a bit on the process. Some of the members may know that on June 5 the government issued a press release on its website entitled, “Liberal obstruction could hurt families, taxpayers”. The first sentence read that with just a few weeks left before Parliament rises “for the summer, obstructionist tactics being employed by [the Liberals]...could result in the loss of billions of dollars...”.

Mysteriously, that press release was taken off the website after it was pointed out by our side that it was the government that had obstructed and delayed the passage of Bill C-52 in a matter of weeks.

I wanted to put that on the record and go through a quick timetable to demonstrate the point that it was far from the Liberals obstructing the passage of this bill. It was the government side, which, presumably, is why it took down the press release from its website after it had been up there for a very short time.

First, on March 19 the budget was finally tabled in the House, much later than most budgets but, coincidentally, only seven days before the Quebec election. The first delay was to produce a budget that was so terribly late by the standards of most years.

March 20 to March 23, the usual four days of debate occurred on the budget document, which is perfectly normal. On March 29, the budget implementation bill was tabled in the House of Commons. March 30 to April 23, the budget was debated at second reading on four out of six sitting days. The time span here includes a two week parliamentary break, which is also normal.

We now come to a real abnormality. Between April 24 and May 11, the Conservatives took the unprecedented step of removing Bill C-52 from the legislative agenda for 15 consecutive sitting days, three weeks in total. That was the only significant delay the budget experienced and it was 100% the fault of the Prime Minister, his government House leader and his government.

We have asked on a number of occasions, and I believe the House leader asked the finance minister earlier today, for an explanation of the three weeks in a row, the 15 consecutive days, during which the government simply yanked the budget bill out of the legislative process. We have not had any answer at all.

Therefore, if there is one reason for a significant delay in this budget bill and a significant delay in getting all that money out to Canadians, it is not on this side of the House. It is a combination of a super late budget in the first place and those 15 consecutive sitting days.

I will continue on with the chronology. On May 14 and May 15, the budget was finally brought back for second reading and was passed in short order. May 16 to May 30, the members of the finance committee sat extra hours outside their usual meeting time in order to pass the budget through committee stage as quickly as possible. They met on five of the next possible sitting days and got the budget through. June 4 and June 5, the government's own report stage amendments were debated and voted on. From June 7 to today, June 12, we are currently on the fourth day of the third reading debate.

I have gone through the full chronology and I would simply say that it is incontestable that the two delays of this budget were from that side of the House and that in other respects this budget bill has moved expeditiously through the various stages of committee hearings.

In terms of the substance of the budget, I would like to quickly summarize the points I have made in previous remarks on this budget. For me it is really summed up with the two words “incompetence” and “dishonesty”. I think those two forces interplay with each other in a number of aspects of this budget.

On the first of those, one has to cast one's mind back a number of years when the Minister of Finance was a senior member of the Ontario government and at that time the Ontario government ran on a platform of a balanced budget.

Lo and behold, after that government lost and the auditors came in, they found there was a deficit of $5.6 billion. For a government to run on what turned out to be a $5.6 billion deficit is not only fiscally incompetent, but it is also dishonest to pretend to be running on a balanced budget when it is not.

I would give a second example. it was clear to every Canadian who paid income tax that budget 2006 contained an increase in income tax. Again, that is incompetent because there is not an economist on the planet and I think very few Canadian taxpayers who would prefer an income tax hike to get a penny off the price of a cup of coffee. It is also dishonest when the government continues to repeat that this is an income tax cut when everybody knows, all the journalists and all taxpayers, that it is absolutely incorrect. The government makes that statement not once, not twice but interminably.

The third example is the equalization. Here we have the spectacle of that famous statement by the Minister of Finance to the effect that the long, tiresome era of bickering between federal and provincial governments is over. It lasted about 30 minutes until he was red in the face in a debate with the Newfoundland premier on television, and it continues to this day, which is perhaps day 80 or something thereabouts of the budget debate, whereas it is well-known that a good budget and a successful budget is out of the news cycle in three days, and here we are on something in the order of day 80 and it is not even clear whether another member from Nova Scotia may vote against the budget today.

Here are blatantly broken promises to the Government of Nova Scotia, the Government of Newfoundland and Labrador and to the Government of Saskatchewan. For all the words of the member from Saskatchewan who preceded me, he essentially ignored the only relevant point, which is that the government blatantly broke a promise to the people of Saskatchewan. One wonders why there is not even one Conservative member from Saskatchewan who would stand and vote against the budget on behalf of his or her constituents, as did at least one and possibly more members from Nova Scotia.

On interest deductibility, we have gross incompetence of a finance minister entirely out of his depth. The incompetence became clear and he withdrew, but he withdrew in an incompetent manner because he focused on double dipping when all the experts are in agreement that the real issue is something called debt dumping. Not only that, but the manner in which he withdrew he alleged that only he had read the budget properly and all of those tax experts out there, whose job is to read and to analyze budgets, had in fact got it wrong. Again, here is a case of incompetence but not even a willingness to admit that any error was made.

Finally, the mother of all broken promises is income trusts. Again, we have seen a comedy of errors, a comedy of unintended consequences in terms of not just a broken promise, but a grossly incompetent execution of that broken promise.

In conclusion, I would simply reiterate that we on the Liberal side will be very proud and happy to vote against the budget. We certainly have not given up on the income trust issue. It will be an election issue in the next election, whenever that may be, and we are confident of victory. We will bring a sensible income trust policy to Canada and significant relief to those hundreds of thousands of Canadians who took the Prime Minister at his word and, as a consequence, lost some $25 billion of their hard-earned savings.

Third ReadingBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 11:50 a.m.
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Ed Komarnicki Conservative Souris—Moose Mountain, SK

Mr. Speaker, it does not have very much to do with that but it does indicate the height of the hypocrisy of the previous government. We have to take things in context. When we look at the dissenting report that was made, it explains itself quite well. I would encourage the member to read it and take things in proper context, as should be the case with the equalization formula within Bill C-52 be taken into account.

In fact, if the government were to go down on a confidence vote, that member and all other members would be running from the House ensuring that the government did not go down because they cannot face an election. They are afraid to do that and we need to take this in the full context of where it is. We will be supporting the budget and the government because we have confidence in it. It will change the direction of this country and it will change it for the better. Canada will not be any worse off, as it would have been under the previous government.

The House resumed from June 11 consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the third time and passed, and of the motion that this question be now put.

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:45 a.m.
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Tom Lukiwski Conservative Regina—Lumsden—Lake Centre, SK

Mr. Speaker, my question is simply this. Since I understand, from hearing comments in the media today from some of the unelected, unaccountable Liberal senators, that those senators may be willing to block Bill C-52 when it finally gets to the Senate, could he tell me if there has been any precedent in Canadian parliamentary history for this occurrence?

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:45 a.m.
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Regina—Lumsden—Lake Centre Saskatchewan


Tom Lukiwski ConservativeParliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, I want to speak for a few moments about the allegations we have been hearing this morning as to the fact that there has not been ample time given for debate on Bill C-52. I want to underscore a point first made by my colleague, the hon. Minister of Finance, when he pointed out quite correctly that in this House on 22 occasions there have been concurrence motions brought forward by members of the opposition parties.

If we take a look at what concurrence motions actually do, we will see that they allow three hours of debate on that particular concurrence motion but that they in effect prevent three hours of debate, per concurrence motion, for government legislation. In effect, then, 66 hours that could have been used to debate important pieces of government legislation were absolutely boycotted by members of the opposition, because they felt they wanted to usurp the responsibility of the government to enter debate on legislation.

Any time I hear members of the combined opposition complaining about lack of meaningful debate, it is their own fault, and they have done it for purely political reasons--

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:40 a.m.
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Jim Flaherty Conservative Whitby—Oshawa, ON

Mr. Speaker, while I thank the member for her questions, she raises the point of reasonable and timely debate. She is a member of the New Democratic Party. There are 29 members of that party in this place. I understand that a total of 24 speeches were given by that party on this bill. One would think that tends toward a fulsome debate on a particular bill.

With respect to moving the bill forward and consultations and agreements, as I mentioned earlier, there was an agreement between the government and the Liberal Party, the official opposition, to move Bill C-52 to the Senate by June 6. That agreement was broken by the Liberal opposition. That is one of the reasons, of course, why we have to move forward.

The government kept asking the other parties in this place how many speeches would be given. Some of the other parties kept adding speakers, so we have come to a place where, as a responsible government, what does one do? We have these very substantial large transfers from the federal government to our government partners in Canada in the provinces and the territories. We need to get them out. The Liberal opposition apparently does not feel any urgency to work with our partners in Confederation for this to happen. In fact, the Liberal opposition broke its agreement to move this bill to the Senate by June 6.

For all of these reasons it is our duty as a government to move forward and make sure that the country works well as a federation in the fiscal sense, that is, that transfers happen for these important areas of government activity, for the people of Canada and of course for those relying on transfers relating to the environment, the Canada social transfer and the other important transfers.

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:35 a.m.
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Libby Davies NDP Vancouver East, BC

Mr. Speaker, I want to begin by saying that what began as a tendency of the government and then turned into a trend has now turned into a measure of desperation as it has complete and utter disregard for the Standing Orders in the House in terms of how it is bringing business forward.

I would like to follow up on what was said by the member for Winnipeg North, who pointed out that the Standing Orders are being used in a way that is not intended. Standing Order 78(1) makes it clear that a minister of the crown can seek agreement from all parties for time allocation. That was not done. Standing Order 78(2) makes it clear that the government can seek a majority of representatives for time allocation. That was not done.

Today the government now is asking for time allocation, without any consultation, but Standing Order 78(3) makes it very clear that this is to be done on the basis that an agreement could not be reached. I have to point out to you, Mr. Speaker, and to other members, that no agreement was sought.

Here we have another example of the government ignoring and disregarding our Standing Orders, even in how it uses this procedure. I find that very objectionable. I think the government should be accountable for that. The government should respond to that and tell this House why it is disregarding the Standing Orders in terms of how it brought forward this time allocation.

Second, why is time allocation required for Bill C-52 in the first place? As we have heard time and time again, this House has a calendar to sit until June 21. We have heard that the finance committee dealt with the bill in good order, heard witnesses and brought the bill back to the House. It was the government itself that either was incompetent or deliberately did not wish to bring this bill forward at second reading. There is a clear indication that there were 11 sitting days when the government could have brought this bill forward if it is as urgent as the government claims.

I bring this to the government's attention again because here we are now, the Conservatives are desperate, and they are using time allocation. They are not consulting with the parties as they should under the Standing Orders. They now are trying to rush this through when nobody in this place has held up Bill C-52.

We are asking only for reasonable and timely debate. One day at report stage cannot be characterized as stalling. I would ask those questions of the government.

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:35 a.m.
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Jim Flaherty Conservative Whitby—Oshawa, ON

Mr. Speaker, I thank the member for Peterborough not only for the good question, which actually gets at the factual issues here in the House and the factual consequences, but also for his speech on this bill last Friday and for his hard work in the House of Commons finance committee on many issues, including Bill C-52.

What happens if this budget bill does not pass? When we talk about the environment, this will not happen: $1.5 billion to support provincial and territorial governments to reduce greenhouse gas emissions and air pollutants. In health, this will not happen: $612 million to support provinces and territories to put in place a patient wait times guarantee, which is vitally important to all of us across Canada.

In terms of training and post-secondary education, there is to be $570 million for Ontario for post-secondary education and training, which is very important to the people of my home province of Ontario. In terms of the territories, there is to be $54 million for the Northwest Territories to cover payments related to the previous formula arrangements. It very important to the territorial governments that they gets the funds to which they are entitled so they can carry on with day to day government in Canada's north.

In British Columbia, and these are important environmental initiatives, there is to be $30 million to promote environmentally sustainable practices in the spirit bear rainforest and Queen Charlotte Islands areas, which are beautiful areas of British Columbia.

Again on training, there is to be $21 million for Manitoba and $18 million for Saskatchewan for labour market training.

As I say, all of these things will not happen unless we pass Bill C-52.

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:30 a.m.
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Jim Flaherty Conservative Whitby—Oshawa, ON

Mr. Speaker, the member opposite is correct that Bill C-52 does address a very serious inequity in the Canadian tax system, that is, it would introduce a tax on distributions from certain publicly traded income trusts and limited partnerships, effective beginning with the 2007 taxation year. I thank the members of the NDP for supporting that measure.

Unlike the member for Mississauga South and his colleagues, we believe in tax fairness. This is an issue of some corporations that were paying the normal corporate tax rate and some that were choosing to become income trusts so they would not have to pay their fair share of taxes in Canada, which simply means that unless we change the law this advantage would be taken by certain corporate entities over some other corporate entities. It means that other people would have to make up the taxes so that we would have proper funding of health care, education and other important priorities of Canadians.

There is no mystery to this. It is quite straightforward. As I say, I thank the NDP for seeing the light. I regret that the Liberal opposition, including the member for Mississauga South, has failed to see the importance of tax fairness for Canadians.

With respect to speaking to the bill, I am told that at report stage the member for Calgary—Nose Hill, who is my parliamentary assistant, spoke to the bill.

Of course, the government members have the advantage of working directly in making sure that we answer their questions and that I can answer their questions concerning the budget bill, but also, they see the absolute importance of getting this bill passed before the end of June so that the transfers, the important Canada social transfers for important parts of provincial agendas, can be transferred to the provinces and territories. They see that clearly. Regrettably, it does not appear to have been seen by the members opposite, including the member for Mississauga South.

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:30 a.m.
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Jim Flaherty Conservative Whitby—Oshawa, ON

Mr. Speaker, I understand the concerns mentioned by the member. I also understand that 22 concurrence motions have been brought in with respect to debate on this matter.

The member talked about thorough and reasonable debate. I understand that 30 speeches in total have been given by Liberal members on Bill C-52 and 24 speeches in total by the NDP. This includes a series of members from both of the Liberal Party and the New Democratic Party who have spoken more than once to this issue, which is their right.

However, when the member raises the issue of reasonable debate, I think it is reasonable to look at the number of speeches that have been given, the number of concurrence motions that have been brought forward and the number of members who have spoken more than once with respect to Bill C-52.

With respect to consultations, I understand that the government House leader and the deputy government House leaders have had a series of discussions with their opposition counterparts with respect to the progress of the bill.

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:25 a.m.
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Judy Wasylycia-Leis NDP Winnipeg North, MB

Mr. Speaker, my questions have to do with the use of a very blunt instrument to achieve the government's agenda when it had many other avenues available to it to ensure that the budget was passed on a reasonable basis.

Today we are faced with a government that has chosen to bring in the heavy hand of closure on democracy and debate in this place. It is a measure that we regret. We know it was used hundreds of times by the Liberals but we thought the Conservatives were different. They said that they were different. They said that they believed in an open and democratic process. They said that they would not resort to these heavy-handed tactics and yet today they did so without having used all available means at their fingertips to move the process along.

My questions are threefold.

First, why did the government miss 11 days of opportunity to advance this bill through second reading? We know that between April 17 and May 11 there were 11 days when Bill C-52 could have been called for second reading debate. The government chose not to that and put us back on a schedule so we are at this point today.

Why did the government not use every opportunity, and the will of this House, to have a thorough and reasonable debate on Bill C-52, the budget implementation bill? Does the government have something to hide? Is it afraid of the developments that we are seeing today with respect to the Atlantic accord and Saskatchewan? Did they prevent the government from having the open debate back then? Was the government afraid that it would get out in the open? If that is the case, the government really hoisted on its own petard because it just created the circumstances for a much greater outcry from across this country.

Second, why is the government now using closure when the finance committee did its job in a very expeditious way? We took only five sittings to deal with this bill in terms of all of its ramifications, to have hearings and to do clause by clause. We were very responsible in that way and yet the government still brings in closure.

Third, why did the government not take advantage of our Standing Orders for consulting around the use of closure? The government has avenues for consulting with all parties, for seeking opinions and advice. Instead, the government chose to go immediately to the last resort measure in the Standing Orders, which is to unilaterally impose this motion on Parliament.

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:25 a.m.
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Jim Flaherty Conservative Whitby—Oshawa, ON

Mr. Speaker, the member wants me to answer the questions but he continues talking. I will try to answer the question. What he does not want to hear is that the budgets that we have brought in reduced taxes by more than four times what was done in the previous budgets by the Liberal Party opposite.

A tax reduction is important, which is why Bill C-52 going forward is important for Canadians.

The question was about consultations among House leaders. I understand that there was an agreement to report the bill to the Senate by June 6 but, obviously, that has gone by. There was a comment about there being an attempt to move forward today by the opposition House leader. If he wants to move forward today, that is exactly what we are proposing to do, to move forward with Bill C-52 to third reading today. I am sure the opposition House leader will support that since he says that is something he wanted to do, which is to move forward today with Bill C-52 to a vote.

In terms of the timing of Bill C-52, which has been debated here at some length, there were discussions between the House leaders about the number of speakers. I am told that the Liberal opposition kept adding more speakers after saying that they would only have so many speakers. This elongates debate, which is a good thing.

As to whether there were other bills being debated in this place, yes, important bills about democratic reform of the unelected Senate that is dominated by Liberal senators who are, as I say, unelected. We are trying to reduce their terms somewhat from a lifetime appointment to age 75 without them ever being elected.

The other legislation that is in this House, which has been opposed and delayed repeatedly by the Liberal opposition, relates to crime. I come from the greater Toronto area and crime is an important issue for us. One would think that the Liberal opposition would have been anxious to pass a bill that would have a minimum sentence for the use of a gun in a criminal offence, particularly given what we live through in urban areas of Canada, particularly the greater Toronto area. However, the Liberals were not. Those bills needed to be brought to this place for debate so we could get them passed and we could strengthen anti-crime measures in the country, which does not seem to be of interest to the members opposite.

Another question had to do with what went on in the finance committee but I would leave that to the members of the finance committee to debate.

The last point raised by the member opposite had to do with the Atlantic accords and the sort of discussions that have been taking place. It is always interesting to hear these questions from the opposition Liberals because they are led by a leader who says that there is no fiscal imbalance between governments in Canada. In fact, he goes further and says, “Fiscal imbalance is a myth”. Therefore, if the Liberals were the government they would do nothing on this subject, led by the current leader of the Liberals, and yet they want to ask questions about the Atlantic accords.

If we go back and look at the history--

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:20 a.m.
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Whitby—Oshawa Ontario


Jim Flaherty ConservativeMinister of Finance

Mr. Speaker, Bill C-52 is, of course, the first budget implementation bill. As a new government, I am very pleased that our budget 2006 had the usual spring implementation bill and the fall implementation bill and, together with this budget, reduces taxes for Canadians by $40 billion or so over three years. It is a very substantial tax reduction and in fact four times higher--

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:20 a.m.
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Ralph Goodale Liberal Wascana, SK

Mr. Speaker, I have four or five questions that I would like to address to the government House leader and I will attempt to put them all together at once and, hopefully, the answers could be forthcoming.

First, Standing Order 78 contemplates consultations to achieve an agreement on time allocation among all or, failing that, a majority of the parties in the House. I would like to ask the government why the government House leader did not consult with the official opposition on this particular matter.

I would point out to the government House leader that yesterday, in a debate about Bill C-52, I specifically indicated to him and to the House that from the perspective of the official opposition, we expected Bill C-52 to be disposed of today. I made that comment before the notice was given with respect to the minister's intention under Standing Order 78.

That being the case, having given that very clear overture, I would ask the government why there was no effort to consult about this matter and why there was no attempt to reach an agreement in advance of the minister taking the action that he has today.

Second, in the flow of events around Bill C-52 the government itself only got to its 2007 budget very late in this sitting, about the middle of March, and then the government only pursued debate on Bill C-52 sporadically. At one point there was a full, unexplained three week hiatus in the debate at second reading. Why did the government deliberately delay and avoid its own budget bill at several stages during its course through Parliament before we got to the situation that we are in today? What was the government's strategy in delaying its own legislation?

Third, in the committee proceedings on Bill C-52, the government first tried to avoid any scrutiny whatsoever by avoiding all witnesses being called to the committee. The opposition insisted on basic decent hearings and extracted a commitment from the government to hear at least some witnesses in a serious and dignified manner, especially those who believed that the government had not told them the truth. I am thinking here particularly of people who had invested in income trusts and a number of the provinces which believed they had been betrayed on equalization and the Atlantic accords.

The format for these committee hearings to hear these witnesses was unilaterally changed at the last minute by the Conservative committee chair, thus breaking the all party agreement on how to dispose of Bill C-52. Why did the government violate the agreement that was in place on how to hear these committee witnesses, especially any provincial premiers and especially Premier Calvert?

Fourth, and my final question, the Prime Minister and the government have defended Bill C-52 in blanket terms. They deny, for example, that this bill affects and changes the Atlantic accords but still they admit that discussions are indeed underway to fix the problem that Bill C-52 poses for the Atlantic accords. Either there is something that needs fixing or there is not. If Bill C-52 does not negatively affect the Atlantic accords, then what is being discussed with Premier MacDonald of Nova Scotia and will the same flexibility be shown toward Premier Williams of Newfoundland and Labrador and Premier Calvert of Saskatchewan?

Bill C-52--Time Allocation MotionBudget Implementation Act, 2007Government Orders

June 12th, 2007 / 10:15 a.m.
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York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform


That in relation to Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, not more than one further sitting day shall be allotted to the third reading stage of the Bill;

and fifteen minutes before the expiry of the time provided for government business on the day designated for the consideration of the said stage of the said bill, any proceedings before the House shall be interrupted, if required for the purpose of this Order, and in turn every question necessary for the disposal of the said stage of the bill shall be put forthwith and successively without further debate or amendment.

The House resumed consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the third time and passed, and of the motion that this question be now put.

Bill C-52--Notice of time allocation motionBudget Implementation Act, 2007Government Orders

June 11th, 2007 / 5:55 p.m.
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York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, an agreement could not be reached under the provisions of Standing Order 78(1) or 78(2) with respect to third reading of Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007.

Under the provisions of Standing Order 78(3), I give notice that a minister of the Crown will propose at the next sitting a motion to allot a specific number of days or hours for the consideration and disposal of the proceedings at the said stage.

Budget Implementation Act, 2007Government Orders

June 11th, 2007 / 5:25 p.m.
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Judy Wasylycia-Leis NDP Winnipeg North, MB

Yes, as my colleague from Ottawa Centre said, there is much here. We could talk for days. All we wanted in this whole parliamentary process was the ability to put on record the concerns of Canadians.

Indeed, there are many concerns across the country about the federal Conservative budget. We are not trying to hold up the process. We are not trying to be difficult. We are not trying to use any of the rules available to us to hurt democracy and to deny the need for the bill to be passed at some point, but we do want the opportunity to speak.

In fact, if we look at this whole process, as has been said many times in the debate, the Conservatives have had days and weeks to advance the bill and get it through the House.

Is it not interesting that today there is this panic? There is this need to create a crisis in order to get Bill C-52 through, but in fact the Conservatives had 11 days between April 17 and May 11 to actually advance the debate. They had 11 chances to bring this bill forward to debate, so that we could proceed and get it through committee, to report stage and back here for third reading.

Obviously, yes, as my colleague from Ottawa Centre said, it was not important enough at the time. They wanted to hide it as I am told by the member for Windsor--Tecumseh. Yes, there is clearly an attempt on the part of the Conservatives to hide, to bury, and to get rid of any avenues for discussing this budget.

First they tried not calling it, now they are hoisted on their own petard, and are forced to actually hear us out as we thoroughly debate Bill C-52 on third reading.

The developments of the last week have certainly given us a focus for debate and discussion. There is the realization on the part of the premiers of Newfoundland and the premier of Nova Scotia as well as the premier of Saskatchewan that the government in fact has no intention of keeping true to its word of keeping the promise that it made to honour the Atlantic accord and the Saskatchewan agreement.

The debate has now become, out of necessity, one that is dealing with the principle of governments keeping their word.

For too long political parties that have formed government break their promises the first chance they get. It is obvious that when a government breaks its word on something as fundamental as resources, an economic lifeline to regions such as Newfoundland, Nova Scotia and Saskatchewan, we cannot sit back and ignore it. We simply cannot let the Conservatives make up some justification for breaking their word and giving them the go ahead.

Obviously, the Conservatives who are waving their hands at me are embarrassed by this situation. They should be embarrassed. They ought to give some thought to the cries from people in the Atlantic region and Saskatchewan who want them to reconsider their position and keep their word with respect to the Atlantic accord and the Saskatchewan deal.

There are eons of writings on this issue and a multitude of quotes from members on the Conservative benches in support of the Atlantic accord and the Saskatchewan agreement. Let me quote the Prime Minister from November 16, 2005. He said:

The Prime Minister is also failing Saskatchewan on equalization. The government promised to reform the equalization program in 2004 for Saskatchewan. The government now says it will not get to that until at least 2006, costing Saskatchewan over $750 million in lost revenue. When will the Prime Minister overrule his finance minister and make the changes necessary, so Saskatchewan does not lose this money?

He went on to say on January 12, 2006:

A Conservative government would also support changes to the equalization program to ensure that all provinces and territories have the opportunity to develop their economies and sustain important core social services.

I could go on at great length making reference to all kinds of previous commitments, words, and promises by Conservative members in the context of the issue of fiscal balance and fairness in terms of distribution of wealth in this country.

However, the point has been made amply by the member for Cumberland—Colchester—Musquodoboit Valley. It has certainly been made in the news today by the premier of Nova Scotia, Rodney MacDonald. It has been made very well at the finance committee by the premier of Saskatchewan, Lorne Calvert.

It is time for the Conservative government to begin to listen. We offered a solution. We said from the very beginning that this issue could not be ignored. We said from the beginning that previous promises and commitments could not be ignored. We cannot go back on our word when it comes to economic lifelines.

We asked the Conservatives to honour the agreements and view these accords in terms of ensuring that the provinces have the wherewithal and the means to pursue their provincial economies as they develop their energy resources. It does not mean for all time we must ignore a formula that would look at some variation of what amount of revenue is included from natural resource revenue. It is to say honour the accords and then begin to look at how we move forward in the future.

There is no question that the Conservatives inherited an absolute mess from the Liberal Party. The Liberal government had years to sort out this problem. It refused, as happened with the income trust file. On both counts, they had the evidence and they would not bite the bullet and deal with them.

The Conservatives inherited an absolute mess and that is certainly the case with income trusts. On that issue, the government clearly recognized that it had to act or we would see more tax evasion on the part of corporations and more loss of revenue that would provide important programs for seniors and others.

With respect to fiscal balance and equalization, the case is equally so with the government, and I quote from the Edmonton Sun of a couple of months ago: “Grits Left 'Utter Mess' Books in Disarray After Deals With Provinces, Says Tory Minister”. I agree with that. It was an absolute mess.

There was a chance back in 2004 for the government of the day to build on a consensus achieved by the provinces to put in place a formula that would hold us in good stead for years to come, but the government refused. It refused, out of political expediency and out of a totally messed up sense of priorities in terms of fiscal balance. We have a government that cares more about putting money aside for a rainy day even though it is raining today.

We had a past Liberal government that has a $80 billion of surplus because of unanticipated surpluses caused by lowballing and refusal to forecast accurately. The government accumulated over $80 billion on a most unethical and immoral basis and then decided to put it all against the debt as opposed to deal with the priorities of Canadians.

This is the strange part. The Conservatives are following that pattern, not dealing with this trend line, this pattern of broken promises. Clearly, what is needed is for the Conservatives to have learned from the mistakes of the Liberals and not repeat them.

First, that means not to break its promise when it comes to the Atlantic accord and the Saskatchewan deal. Second, it means to stop the lowballing so we do not have all this unexplained surplus or a surplus that has no demands on it and then allow that to go against the debt without looking at the priorities of the country. Stop playing games with Canadians. That is what we are saying today. Start to put the issues on the table and hear the voices of Canadians.

That would mean, for example, talk about seniors and ensure they are able to live with integrity, decency and security as a reward for having built our country. Do not nickel and dime them. Do not take away the $200 per union it would cost the government to deal with an error by Statistics Canada in the consumer price index.

My colleague, the member for Hamilton Mountain has been saying this for days and weeks. She has been tabling hundreds and hundreds of petitions from seniors who are asking why, when they make a mistake and do not pay government what it is owed, it comes after them in a flash expecting them to pay right away? However, when the government owes them money, why do they have to sit back and take excuses? Why do they have to sign petitions? Why do they have to sue the government? Why is there no justice when it comes to government error in calculations that cause people to lose money that is rightfully theirs?

In this case the money owed to seniors, because of that mistake, is about $1 billion. Why did the government not say it was important to pay the people who built our country that money as opposed to putting $22 billion and more against the debt for a rainy day, when it is raining now on the heads of seniors, when the house is leaking, when many seniors are having a heck of a time trying to make ends meet, trying to find decent accommodation, trying to pay for their drugs, trying to provide for themselves, not having to resort to turning down the heat in winter or skipping medication just to save money?

Is it not raining now? What is wrong with the Conservatives? Do they not see that when there is any kind of despair in the country, any kind of destitution because of government inaction and government callousness, is that not enough for them to put some of that money toward the people who built the country? After all, they are not in poverty because of something they did or did not do. They are in poverty because of either deliberate policies to hurt them, like the failure to acknowledge the error in Statistics Canada and the consumer price index, or errors caused by lack of foresight, vision and planning, like we see with respect to the national pharmacare program or national housing.

Is it not time that we started to put money into those areas that will help ensure people have security now and can contribute to this economy and build for a better future?

That is just one example. Here is another one. Why does the budget refuse to collect $300 million from big oil and gas companies that are getting this subsidy from government to develop the oil sands? Why are we giving subsidies to these giant corporations, which are developing and extracting our natural resources from the ground, including the water, and making huge profits?

That $300 million could have gone some distance to deal with some of the issues we see in our own communities, with concerns coming from seniors, from aboriginal people, from parents trying to find child care. That money could have gone into the economy. It could have built the economy and helped bring down the debt in the long run, and at just as fast a rate as will happen from putting it directly against the debt, $80 billion under the Liberals and $22 billion under the Conservatives, with some foolish little catchy program called a tax back guarantee, which does not mean a hill of beans for Canadians.

It will not mean anything to people struggling, but it would have meant a lot if they had taken at least some of those billions of dollars and invested them in programs that would guarantee some reasonable access to job opportunities in the country. It would guarantee some reasonable means of transportation. We might have put some money against the infrastructure deficit and some money into child care and other programs that support parents trying to juggle work and family responsibilities.

The government says that it has to get this budget bill through immediately. Otherwise it cannot spend money on a number of programs. First, that is nonsense. It knows and Canadians know that when money is in the budget and the budget is passed, it does come to fruition and people can count on that money. That is certainly a given. It is also interesting that the government chose to list a number of initiatives that it felt might not get the money on time as an excuse for ramming the bill through and bringing in rare Standing Orders, like the one I talked about, which has not been used more than twice in the last 30 or 40 years.

The government says that it must have the bill through so it can spend the $1.5 billion for the Canada ecotrust for clean air and climate change. Perhaps it is not such a bad idea that we hold off on expenditures in this area when it does so little to help ordinary people refit or restore their housing so they have heating or other services on a more sustainable basis. Perhaps it would give the government a moment to consider the fact that this program now does not provide any means to low income Canadians to retrofit their houses. Perhaps the government might want to take seriously the proposals for redefining this so-called green energy program to allow for low income households to take advantage of it.

Why do we keep getting from the government programs, tax credits and a scattering and smattering of initiatives that always benefit those at the top end and do nothing to help those at the bottom end? Why do we keep allowing the prosperity gap to widen when it is the role of government to close that gap?

Surely the way to do that is through progressive measures, not things like child tax credits, which give rich families more than low income families, not envirofit programs, which exclude low income Canadians, and not credits for manufacturers, which are meaningless when in fact all the jobs are gone and the plants are closed.

It is time for the government to reconsider its direction and realize it is squandering an important moment and a great opportunity that will build a wonderful country. However, it takes leadership and it takes vision. It takes a government that says that it will balance our fiscal priorities to ensure some money goes against the debt, some money for tax relief for Canadians and some money for those important programs that build a country.

The House resumed consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the third time and passed, and of the motion that this question be now put.

Extension of Sitting HoursRoutine Proceedings

June 11th, 2007 / 4:35 p.m.
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Joe Comartin NDP Windsor—Tecumseh, ON

As my colleague from Acadie--Bathurst has said, this is about slashing the court challenges program and any number of really good programs that the government has taken an axe to, both in this budget and in previous policy decisions.

We started hearing last week that the government members were in a panic, that they had to get Bill C-52 through the House. Wait a minute, we said, the government has had well over three months to work this through. My colleague from Vancouver, our House leader, has detailed this. The government has had a number of opportunities to bring the bill forward for full debate at second reading, report stage and third reading. This is the budget. This is the biggest item for any Parliament to deal with.

What did the Conservatives do? They just kept putting it off. They brought forward other bills. This was completely within their control. They brought forward 11 other bills and said the House would deal with them first. Now we are going to deal with this one, they said, and then we are going to deal with that one. They brought forward 11 different items on 11 different days when they could have brought forward Bill C-52. Now it is panic time for the Conservatives and they are saying they have to get the bill through.

I want to address what seems to be a suggestion that somehow these programs are all going to collapse, along with this new funding, if the bill does not get passed in the next 24 hours. That is just not true. This money will be spent when Bill C-52 finally gets through the House. The flow of that money may be postponed by several days or several weeks, but it will get spent because obviously both the government and the Bloc Québécois have indicated that they are going to support the bill and they have the numbers in the House to get it passed.

Constitutionally, the government again putting around the panic that the Senate somehow is going to block this bill. That is not going to happen. It may be delayed a bit, but the Senate does not have the constitutional authority to block a money bill. Specifically, it has no authority to turn down a budget. That is not going to happen either.

What this is really about is the fact that the Conservative government is tired, it does not have a program, and it wants to get out of here. If they can get away with it, Conservative members are going to move adjournment of this House as soon as they get Bill C-52 through.

We do not have a problem with debating Bill C-52. I have here about 20 items that I would just love to be able to get into. If I did, I could be here for many hours showing the flaws in this budget. That is not what this is about. This is not about this opposition party or, quite frankly, the other opposition parties being shy about debating the contents of Bill C-52 and all that it lacks.

What this is about is the government's unwillingness to face, in a realistic fashion, what is going on in the country. It continuously gets beat up, whether it is on the climate change file or whether it is on Afghanistan. We can go down the list. The government is just tired of being here.

I could not help but think of the hypocrisy of some of the statements coming out of the mouth of the House leader when he addressed this motion earlier this afternoon. He said that we should believe the Conservatives because they did not intend to have an election. Of course he did not address the fact that their airplane was lined up, with a contract for it, and their campaign office was open and substantially staffed. They were ready to go to an election. Quite frankly, if the Canadian people and the opinion polls had not made it clear what was going to happen if they took the country to an election at that time, we would have been in an election now.

What has happened is that the Conservatives did not have a fallback position. They did not know what they were going to do if they did not have an election. They do not have an agenda as to how they are going to deal with it. They want to get out of here so they can regroup and see what they might do when we come back in the fall. They want to get out of here as fast as possible. That is what the motion is really about.

I want to say very clearly on the record that the NDP has no problems whatsoever with staying here until June 22, which is what is scheduled. Quite frankly, we have no problem with extended hours. What my party and I are concerned about is that Standing Order 56.1 will get used probably as early as Wednesday and the House will adjourn.

I know that most Canadians do not fully appreciate the amount of important work that happens outside this chamber and particularly in committee. Again, in many incompetent ways, the government kept pushing crime bills through the justice committee, through the two special legislative committees it set up, and also in some work that we have been doing in the public safety and national security committee. There is a lot of work going on, both in terms of bills that have come from the government itself and in terms of a large number of private members' bills on specific crime issues, which we have been dealing with.

A number of those, probably three, four or five, and both private members' bills and government bills, would be dealt with and completed if we stayed sitting in committee until June 22. If in fact we adjourn earlier than that, all of this work will be postponed into the fall. As well, depending on whether the government actually prorogues sometime through the early fall and comes back with a new session of Parliament, which is the rumour is floating around, some of those bills may be ended completely and never will see the light of day.

Thus, it is quite important for the House to continue to sit. We in the NDP understand that. We as the NDP are quite prepared to sit here. We as the NDP will do whatever we can to thwart the government's attempt to adjourn the House early.

The motion, though, is misleading for the public when it tries to let the public know that the government really wants to work longer hours. That is not what it is about. We believe very clearly that if we do not stop the Conservatives the House will adjourn in the next few days.

Specifically with regard to Bill C-30, it is one of the bills that badly needs to get in front of the House. All three opposition parties are supportive. They have gone to great lengths and have done a great amount of very good work in amending the bill into a form that in fact will allow the country to deal with the crisis we are confronted with as far as global warming and climate change are concerned.

In that respect, we would very much like the government to commit this week or next week to bring that bill forward for a fulsome debate at report stage and third reading. It is ready to go. All the background work has been done. In that regard I am proposing at this time to move an amendment to the motion before the House which would read as follows: “That the motion be amended to add immediately after 10 p.m. the following: 'and if the government calls Bill C-30 at any time, the House shall continue to sit until the bill has been decided at all stages'”.

Extension of Sitting HoursRoutine Proceedings

June 11th, 2007 / 4:30 p.m.
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Libby Davies NDP Vancouver East, BC

Mr. Speaker, the 11 days in which the government could have brought forward Bill C-52, the budget implementation bill, does not include the opposition supply days. The fact is the government makes its own choice and its own priorities. I totally agree those bills were debated.

However, today we are now hearing, and we heard it on Friday, that the government wants to take these extraordinary measures to get through its budget bill, but it has left it to the 11th hour. If it were such a priority, why did it not take precedence over other bills? I can think of one bill that dealt with the exotic dancers. Why on earth did that have to be debated?

It is the government's decision in what is or is not called. It clearly made a decision not to call its budget bill, to leave it very late in the day and then come in with this little tactic of it being urgent and that the hours of the House would have to be extended. It is absolute nonsense. Clearly, if it were a priority, it had ample opportunity to manage its agenda.

It is either deliberate or it is incompetence. One can take a pick.

Extension of Sitting HoursRoutine Proceedings

June 11th, 2007 / 4:20 p.m.
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Libby Davies NDP Vancouver East, BC

Mr. Speaker, I was happy to allow the House leader for the Bloc to go ahead of me in the usual order.

I will be sharing my time with the member for Windsor—Tecumseh.

I want to spend a few minutes laying out what is going on here.

First, we are all aware, as members of the House, that we receive a calendar every year. The calendar is very clear in that the House is intended to sit until June 22. We all agreed to this, all parties, through the whips. It is something with which we are all familiar.

We also are aware that on this day the government can, as it has done, move a motion for the extension of hours. We are debating a motion now as to whether the hours should be extended from June 13 to June 21 to 10 p.m. every night. The question that is really before us is this. Is this a warranted measure? After hearing the government House leader, this is a crisis that the government has manufactured.

Let us be very clear about what has taken place. This is happening because of the incompetence of the government in the management of its legislative agenda, its lack of consultation with opposition parties and its lack of calling its own bills. For example, we heard the government House leader talk about the budget bill, Bill C-52. He has said that he wants to get it through. There were 11 days when the Conservatives could have called the bill for second reading and they failed to do so. Instead they brought in all kinds of other bills that were quite inconsequential. If the budget were so important, they had ample opportunity to bring the bill forward for second reading.

I point out on the record that once it went through second reading, when the Conservatives finally brought it forward into the House and it went to the finance committee, the finance committee met for four sessions only to hear witnesses. It in effect fast-tracked that bill. It heard witnesses very quickly on a budget bill, which is core to our whole reason for being here. Then it was brought back to the House. We had one day of debate on the report stage. Now we are now debating third reading.

When we look at what has happened, it is clearly a manipulation by the government itself on its own agenda. I think what is happening is the Conservatives have brought forward this motion today for extension, even though they are saying the extended hours would go to June 21, so they can cut a deal to get out of here early. If we get out of here early and they get their budget bill, which we know they want, there will be no committees, no question period and no debate on other bills. That clearly needs to be put on the record.

In terms of management of other business, we have heard the government House leader say today that all these justice bills have to come forward. If we look at the agenda of the justice committee, the government made it a priority to deal with private members' business. It has taken up the valuable time of the committee to deal with private members' bills. Now we are being told it has all these other bills that it wants to get through. It really does not cut it. It does not make sense.

I really appreciate the position you took on Friday, Mr. Speaker. At the very last moment on Friday, the government tried to bring in a very rare Standing Order, used for emergency debates, to deal with Bill C-52 and extend the hours to rush the bill through. To your credit, you listened to what members in the House had to say and you made the correct decision in the end. I want to thank you for that. These things are really important. We have to play in a way that is open and transparent, and I do not believe the government is doing that at this point. Therefore, we are very suspicious and skeptical about the agenda.

Again, another irony is the Conservatives are saying that they want to extend the hours of debate. Yet we have never seen the light of day for Bill C-30, the clean air and climate change bill that came out of committee. The bill was amended by the opposition. It is a bill that would work, and it has the support of the majority of members in the House. However, the government itself is refusing to call it forward. We will stay here for as long as it takes to debate that bill. We consider it is an urgent matter that Canadians want us to address.

We will stay here for as long as it takes to debate that bill. We consider it is an urgent matter, which Canadians want us to address. It is a priority that goes beyond all partisanship, but I did not hear the government House leader mention that bill.

The Conservatives would rather get out of here, not having to bear the public scrutiny in question period and committees and not debate all the other bills. They just want to get the budget through. I fear they have made a deal with the official opposition. I do not know that, but I can almost guarantee, even though these extended hours will be approved, in a couple of days, maybe Wednesday, they will find a way to adjourn the House. That is really their agenda.

As the Bloc House leader has mentioned, one bill that we believe must be brought forward is the ways and means motion. It used to be called Bill C-55, which was the wage earner protection bill protecting workers from bankruptcy. This has been an outstanding matter.

The government, again, has not engaged in adequate consultation with the opposition parties, which want to get this bill through. It was passed in a previous Parliament, but was never given royal assent. It is an absolute injustice that today workers still do not have protection from bankruptcy. Millions of dollars have been lost, legitimately earned and deserved wages of workers because they have not had the protection of that bill.

I want to put on the record today that this attempt by the government to bring in extended hours is really about adjourning the House. It wants to get a very bad budget bill through. It looks like the official opposition is now complicit in getting through a budget bill, which, as we have seen, is a disaster in Atlantic Canada in that it has broken the accord. It is a disaster in terms of so many other areas, whether it is housing and homelessness, student summer programs or the environment.

We know the government wants to get the budget passed and that is all it cares about. I am very concerned we are facilitating its agenda under the guise of extending hours when really what it will do is rush to adjourn the House. We know it does not want to be accountable or go through question period.

Let us not forget that the Conservatives were filibustering in the committees. The Conservative members were making the committees dysfunctional. Why? Because they did not want business to go ahead in committees.

We found out about their 200 page playbook, a handbook for all the tactics that its members and chairs could use in the committees. This is further evidence that the Conservatives real game plan is not to deal with all the legislation about which the government House leader spoke. They want to rush through a bad budget bill that has barely been debated.

Nobody is holding up the budget bill, by the way. There are no tactics being employed by the opposition to hold it up. We want to have an adequate debate. We want to ensure that people can say, on the record, what they think about the budget because we have a lot of criticisms about it.

Let us be very clear. The motion today is under the guise that government members are ready to work and extend the hours of the House until 10 p.m. every night. Really it is about getting out of here, for the Conservatives to get beyond public scrutiny, to shut down the House, committees and question period once the budget bill is passed. That is what we will see happen.

Extension of Sitting HoursRoutine Proceedings

June 11th, 2007 / 4 p.m.
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Pierre Paquette Bloc Joliette, QC

Mr. Speaker, we have before us a motion which asks, pursuant to Standing Order 27(1), that commencing on Wednesday June 13, 2007, and concluding on Thursday June 21, 2007, the House shall continue to sit until 10 p.m.

The Bloc Québécois will support this motion because we are determined to see Bill C-52, the budget implementation bill, passed before we adjourn for the summer. As you know, this bill contains some significant transfers for Quebec. They do not correct the fiscal imbalance, but they will make it possible to relieve the fiscal and financial pressures Quebec is experiencing.

The Bloc Québécois set the bar at $3.9 billion in additional transfers to Quebec, the third year, to be satisfied with the budget. As you know, there is $3.3 billion. More remains to be done, especially when it comes to post-secondary education, but we think that with $3.3 billion for Quebec in the third year, an important step has been taken to relieve Quebec's financial pressures.

Once again, this does not correct the fiscal imbalance. A solution to the fiscal imbalance will take negotiations to transfer tax points equivalent to the transfers for post-secondary education and health care to Quebec, to prevent Quebec from being at the mercy of unilateral decisions by the federal government. In the mid-1990s, for example, when the former finance minister and former Prime Minister decided unilaterally to cut transfers to the provinces in order to solve the government's problems, this created problems for the provinces. It is therefore extremely important to us that the budget be adopted before the summer recess.

In addition, I do not completely share the opinion of the House leader of the official opposition that we are referring to 2006-07 when we are talking about closing the books. It is true that when the books are closed in September, they will be the books for 2006-07. But if we have not disposed of the budget surplus, if we have not decided how the surplus is to be used before the books are closed, that money could well be used simply to pay down the debt.

I have an opinion here from the Library of Parliament that supports what I am saying. I would like to read a short excerpt from it:

If the budget were adopted before the end of the fiscal year but the Budget Implementation Act creating the trust [we are talking here about the Canada ecotrust] were adopted later in the 2007-08 fiscal year but before the government's books were closed, for reasons related to the parliamentary calendar, a portion of the 2006-07 surplus could no doubt be deposited in the trust.

It is very clear, then, that if we do not dispose of the budget before the House rises for the summer, that money will no longer be available for the Canada ecotrust, because the books will be closed in mid-September. This is also true of certain amounts for the health trusts.

We cannot take that risk. That said, the Bloc Québécois had another extremely serious concern. When the government talked to us about the possibility of introducing this motion, we indicated that what was important to us was the budget—and we are going to work to get it adopted as soon as possible—but that we also wanted an amendment to the notice of ways and means motion concerning the Bankruptcy Act and protection for workers' salaries when their employer goes bankrupt. We told the government that this was imperative for us.

As I was saying, we will support this request for extended hours. It is a priority not only to ensure that the notice of ways and means is tabled and corrected by taking into account the unanimous motion of the National Assembly, but also that the government agrees to fast tracking this bill to amend the Bankruptcy Act so that wage earners are protected—which is what all parties in this House now want—and that the laws of Quebec and the Civil Code of Quebec are respected.

Earlier, in response to a question that the Bloc Québécois asked and that I myself asked the Minister of Labour, we were assured that sometime tomorrow an amended notice of ways and means, taking into account the unanimous motion of the National Assembly, would be tabled with a bill. I think we will have the unanimous consent of all the parties in this House. I do not see why the New Democratic Party or the Liberal Party would oppose the will expressed so many times by the government and the Bloc Québécois

I would like to take this opportunity to congratulate my colleague for Saint-Bruno—Saint-Hubert, who worked so hard on this and who never stopped hounding the entire Conservative government—especially the Minister of Labour—to achieve today's result. With these two guarantees, we feel comfortable knowing that Bill C-52 will be adopted before the summer break. This will ensure that Quebec receives the transfers it needs even though this bill does not close the debate on the fiscal imbalance. This will also put workers in Canada and Quebec on the list of preferred creditors, thereby giving them new protection when businesses go bankrupt. The creation of a wage protection fund will give them a chance to be compensated should their employers be unable to pay their wages. We think that this is extremely important.

As my colleague mentioned earlier, one of our priorities is Bill C-51, which would cede certain islands that are currently the property of the federal government back to Inuit nations. This is a request that dates back a long time, and it seems that everyone is in agreement. That is also the case for Bill S-6, An Act to amend the First Nations Land Management Act. We think it is very important that this bill be passed to bring justice to the first nations of Quebec. There is also Bill C-59, which would make using digital cameras to make unautorized recordings of movies a new offence under the Criminal Code. Unfortunately, Canada, Quebec and even Montreal have become hotbeds of this kind of piracy, which is a threat to the development of the Montreal region's very prosperous film industry.

This idea has already been raised in committee by the hon. member for Hochelaga. If my memory serves correctly, he also introduced a motion adopted by the Standing Committee on Justice and Human Rights. We feel it is important that this bill is passed before we break for the summer, which, incidentally, is not all vacation time. We have many appearances and meetings planned in our ridings. It is, however, a time for festivals, and we have many in the Lanaudière region. I invite all members to come and enjoy them. Furthermore, I would like to take this opportunity to once again ask the government and the Minister of Canadian Heritage to unfreeze the money, to ensure that these festivals can continue to provide relevant programming, not only this year, but also for years to come. She does not seem to be conscious of this. If, for financial reasons, one festival or another shows a deficit, that would jeopardize the survival, the development and the future success of that festival or those festivals. In that regard, it is very important that the government unfreeze the money immediately. I also think that common sense dictates that we focus our attention on bills, such as Bill C-47, for instance.

The Olympic Games will be held in my former riding of Vancouver. I think it is important to cover all aspects dealing with the legitimacy of all trademarks surrounding these Olympic Games.

For all these reasons, we support the government motion to extend the sitting hours to 10 p.m., beginning on Wednesday until Thursday, June 21.

I will close on another note, because I have not often had the opportunity to speak in this House, since I became the House Leader of the Bloc Québécois. Indeed, I had more occasions to address this House when I was the Bloc Québécois finance critic.

I would like to thank Catherine Lacroix, who works in the whip's office, here behind the scenes. She will be leaving us a few days from now, after working here with us for many years. All the members of the Bloc Québécois—and I am sure this is also true for many members of all the parties—have appreciated her finesse and her ability to work well under pressure, while always keeping a smile on her face. She plans to travel for a few months, in Europe, particularly.

Like Ulysses in Homer's The Odyssey, I hope she gains wisdom and fulfillment from her travels. I have no doubt that she will always be successful in all areas of her life. I would like to thank her and wish her all the best.

Extension of Sitting HoursRoutine Proceedings

June 11th, 2007 / 3:40 p.m.
See context


Ralph Goodale Liberal Wascana, SK

Mr. Speaker, it is unfortunate that the government, in proposing this motion today, has chosen once again to maintain its habitual lack of consultation and reluctance to attempt a collaborative approach to organizing the business of the House.

On more than one occasion, as I think the Chair will remember, I asked directly whether the government intended to make use of Standing Order 27. As other House leaders can confirm, the reply was, “probably not”. I do not think we would be off base in the opposition in expecting that if that were no longer the case, if the government had in fact changed its mind, that it would have decently given us a heads-up that it was going to propose this motion today, at least given us that notice some time earlier than around one o'clock this afternoon.

Frankly, as we saw the government House leader making his travels across the floor of the House, I will not say where he went, the heckling and yelling as he departed the chamber obviously indicates the kind of demeanour of which we have to deal.

I do not see what there is on the order paper at present that this motion will get through the House any more quickly than would have otherwise been the case. I presume, judging by the government House leader's remarks, that the government is principally concerned with Bill C-52, the budget bill.

It has represented to the House and to the public that the government is now extremely concerned the bill will not receive royal assent in time for certain expenditures to be booked in the appropriate fiscal year. Let us be clear. The fiscal year the Conservatives are talking about is 2006-07, and that is the point.

The issue is retroactive fiscal bookings for the last fiscal year, not the future fiscal year, as members would have gathered from the remarks of the government House leader. If there is concern about the lateness of the date, the government really has only itself to blame.

Usually federal budgets are delivered in or about the third week of February, which then permits the introduction of a budget implementation bill by the end of that month. If things are properly managed, this would permit the bill to be in committee before the end of March and to be passed at all stages by the end of May or, at the very latest, the beginning of June.

This year the government chose, for its own partisan reasons, to delay the budget until the third week of March. We did not even see it until then. Then it unilaterally interrupted the budget debate. Then having finished that, belatedly, it interrupted, again, the second reading debate on the budget implementation Bill C-52. That interruption lasted for three full weeks, getting the bill to committee only in the middle of May.

As a consequence, the government then bulldozed the bill through the committee, breaking procedural agreements, denying many interested and informed citizens and groups the right to testify on the bill. Let it be clearly understood that any procedural issue on Bill C-52 is a direct result of government breaking the agreement on the process, which had been fully settled by members of the committee.

Nevertheless, the bill is now only in its third day of debate at third reading and there is every indication that the third reading and final stage would come to an end in debate in the House by the end of business tomorrow at the latest.

It is important to underscore what these dates are with respect to the budget. Remember that the House resumed in the final week of January. The budget was not presented to the House until March 19, fully eight weeks into the parliamentary sitting. That was followed by a ways and means motion and the introduction of the budget bill, but that was delayed because the government interrupted its own budget debate on the financial principles of the government.

Its budget was late, the budget debate was unilaterally delayed by itself and then it finally got around to introducing the budget bill on March 29, which was debated at second reading for the first time on March 30. It was then debated in a haphazard, sporadic fashion, brought forward to the floor by the government, until April 23, and then it was hoisted altogether. The House did not see it again until May 14, full three weeks later.

Finally, it went to the committee, not as a result of any filibuster by the opposition or any party in the opposition. The delay was entirely the procedural mismanagement of the government. It was there for less than two weeks and one of those weeks was a break week when Parliament was not even sitting.

It finally passed through the committee, rather expeditiously, thanks to the cooperation of the opposition, and it was brought back to be debated at report stage on June 4. For how long? One day, that is all the report stage took. Now it is at third reading where there have been three days of debate, and probably a conclusion could have been arrived at very easily by the end of the day tomorrow.

This is why I made the point at the beginning of my remarks that there really is nothing on this order paper that could not be dealt with in the ordinary course of business without the measure the government House leader has introduced. Obviously it is a tactic to blame the opposition for the delays that lie entirely within the control of the government.

What is it then? If it is not Bill C-52, what is it that causes the government to move the motion today? Despite frequent requests for the government to outline its realistic legislative priorities before the summer, all we have heard repeatedly from the government House leader and from others on the government's side is a flow of partisan rhetoric. Legislation has in fact been moving along through the House and through committees, despite the government's erratic management of its agenda.

In fact, the most controversial bill on the order paper, and this is what gives me perhaps a little hope here, is probably Bill C-30, the clean air act, as it has been revised by members of Parliament. Significantly, only the government has been stalling it up to now. However, now we will have some extra time, some extra hours of sitting every day beginning on Wednesday.

Can we then conclude that the extra time the government is seeking is to facilitate the work of the House in consideration of Bill C-30? I certainly hope so. It is in this fervent hope that I indicate to the House that my party, the official Liberal opposition, will support the minister's motion for the extension of hours.

In the time available, in addition to Bill C-52, which will probably be done tomorrow, and in addition to Bill C-30, which I hope the government has the courage to recall and put before the House once again, the official opposition also looks forward to making progress on Bill C-11, lowering freight rates for farmers, on Bill C-14, dealing with foreign adoptions, on Bill C-23, dealing with criminal procedure, on Bill C-29, dealing with Air Canada and the use of official languages, on Bill C-35, dealing with bail reform, on Bill C-47, dealing with the Olympic, on Bill S-6 and Bill C-51, dealing with land claims and on Bill C-40, the private member's legislation that would provide free postage for mail from Canada to our troops in Afghanistan.

Then there is an item that was referred to in question period today. This is the bill we are anxiously awaiting to see, the one dealing with wage earner protection. I hope the government will follow through on the commitment given in question period, that it will table the bill in amended form so it can be passed at all stages and brought into law before Parliament adjourns for the summer recess.

Let me mention one other matter, which is outstanding and which should be dealt with by the House, or at least dealt with by the government when the House is sitting. This is the examination undertaken a few weeks ago by Mr. Brown in connection with the matters that have been of great concern to Canadians in respect of the RCMP pension fund.

As we understand it, there is a report due from Mr. Brown on June 15. That was the original undertaking given by the Minister of Public Safety. It would be very important for us to know that the examination is on time, that we will hear from Mr. Brown on time, and that the Minister of Public Safety will take the step that he promised to take and make that report public immediately.

Perhaps the government might also consider, in whatever time that remains before the summer recess, reforming its approach to the mood in the House. The mood could be improved if the government would refrain from certain of its more hostile practices. For example: no more gratuitous attack ads, no more broken agreements on how witnesses will be heard, no more manuals about dirty tricks for disrupting parliamentary business, and no more devious games to misuse Standing Orders of the House. A little good old fashioned good faith could change the mood for the better.

Extension of Sitting HoursRoutine Proceedings

June 11th, 2007 / 3:40 p.m.
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Peter Van Loan Conservative York—Simcoe, ON

Mr. Speaker, if the hon. member had looked in the notice paper, he could have found last week's responses. That is exactly what we intend to do, but first Bill C-52, Budget Implementation Act, 2007, needs to be passed. That is the priority. Then I truly hope for the passage of Bill C-51.

Extension of Sitting HoursRoutine Proceedings

June 11th, 2007 / 3:10 p.m.
See context

York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, I move:

That, pursuant to Standing Order 27(1), commencing on Wednesday June 13, 2007, and concluding on June 21, 2007, the House shall continue to sit until 10 p.m.

He said: Mr. Speaker, this is a motion that can be made one day a year, not on Christmas Day or Ground Hog Day, but this day, the 10th sitting day before June 23. It is a motion that can be made to allow the House to sit late into the evening.

I know that many members, when they look at that portion of the calendar and they see possible extension of sitting hours, they think that means we get to leave early for summer vacation, but that is not what it means. What it means is that under the Standing Orders of the House we can potentially sit and work late to get as much of the people's business done as possible because there are very important priorities for Canadians.

I will bear my soul here and say that it was not always my intention to move this motion. It was my hope that it would not be necessary. I was hoping that we would be making good progress.

For example, Bill C-52 in particular, the budget implementation bill was a bill which we believed we had an understanding with the other parties; in fact it had been shaken on by the member for St. Catharines, the member of the Liberal Party for Scarborough and others that it would be over to the Senate by June 6. Somewhere along the way the Liberal Party sought to treat it a little bit differently and as a result we are still debating it here almost a week later than the date we thought it would be over at the Senate. As a result of course we have lost considerable time to deal with other priorities for Canadians.

I want to talk about what those other priorities for Canadians might be, but first I want to focus on that number one priority which is Bill C-52, the budget implementation bill. As we have heard from many people in the House today, if that bill does not pass by the time the House rises for the summer, if that bill has not been dealt with, there are a number of financial priorities on issues that are very important to Canadians that will be lost, because it is a bill that reaches back to the previous fiscal year to spend funds. Those funds have to be allocated. The bill has to be passed and receive royal assent in order for those funds to be available in that fashion. If not, they are lost.

Some of those examples are ones which we have heard about today. The one that is at the top of my personal list is the $620 million in the budget for the patient wait times guarantee trust. This is money that is allocated to assist provinces in addressing what is one of our number one priorities—actually one of our top five priorities; I should put it that way—from the last election. That priority is to achieve a patient wait times guarantee, to help people get the kind of health care they need on a basis that is reasonable, that is practical, that is clinically sound.

For too long we saw patient wait times under the previous government actually double in length. We have this much vaunted Canadian health care system that we all purport to believe in, but if we really believe in it, we have to see that it works. An important part of it working is that Canadians should receive the health care that they need on a timely basis. That is what the $612 million is specifically aimed at.

The provinces are very anxious to receive these funds. It means a great deal for a lot of provinces. In my own province of Ontario that means $200 million plus of real money that Ontario needs for its health care system. The same thing, together with other elements, will mean for the province of Nova Scotia for health care $639 million including the transfer there. There is similar money throughout the country.

We are talking of significant funds. There are other elements in the budget. Much of that transfer will not be lost, as I said, because it is in the main budget funds, but the patient wait times guarantee money, that $612 million, is money that will be lost if we do not deal with that on a timely basis.

Another one that is very important is the $1.5 billion for the clean air and climate change trust. That is to help the provinces implement their plans to reduce greenhouse gases. It is very important.

On January 4 of this year, the Prime Minister addressed Canadians and identified what our priorities would be in government this year. One of those major priorities was to take real action on the environment. We have just seen that at the G-8 summit. In the summit declaration Canada's approach is an approach that is drastically different than it was for 13 years under the previous government when greenhouse gas emissions rose dramatically regardless of the commitments it took on. Now we have a national plan that results in real reductions, an actual plan that does that in both the short and medium term but also very importantly in the long term.

It is that approach by the Canadian government that was hailed as an example not just by world leaders, by other G-8 leaders, but by journalists from around the world, by special interest groups. The World Wildlife Fund, for example, issued a statement heralding Canada's approach as a model. The reason it is held out as a model and an example is it is an approach that can be used regardless of how lousy one's track record may be. This is important for a lot of the major emitters that had not been part of the arrangements up until now or did not have obligations under Kyoto to implement, major emitters like China, India, Brazil and the United States, to get them to the table and realize that if we are going to take on the challenges of addressing greenhouse gas emissions and turning around the risk of climate change and what it can potentially do to our world, we are going to have to take action in the long term. That is the approach of Canada that is being held as a model.

An important critical component of that approach is to engage and involve the provinces and ensure that they have in their hands the resources they need to be able to deliver. A big part of that is that $1.5 billion of ecotrust money, the clean air and climate change trust money. I underline that if we do not get Bill C-52 passed in time, that money will be lost.

This is where the delay and obstruction that the Liberal Party in particular has been conducting has been very harmful to the interests of Canadians who care about the environment, and in fact even those who do not care about the environment, because even if people do not care about it, it does affect them. It is important for all Canadians that they have that healthy environment.

Another example of the money that could be lost if Bill C-52 is not approved, if the Liberal obstruction is successful, is the $400 million for the Canada Health Infoway project. This is state of the art technology so that people can have better health care, taking advantage of technology to improve our health care system. This is something that is very important for the provinces to be able to deliver on the health care for Canadians, for their residents. Again if the Liberals are successful in their delay and obstruction plan this is something that will be lost if the bill is not dealt with and does not receive royal assent in the near future.

There is another one that is of particular of interest to me because it does affect residents in my part of Ontario. In fact the announcement was made in York region where I live and where my constituency is. That is the $225 million to protect endangered spaces, working in conjunction with groups like the Nature Conservancy of Canada to acquire sensitive lands that otherwise might be lost to development, or if not to acquire them, to put in place the kinds of conservation easements to ensure that they will be protected in their natural state for the foreseeable future, for as long as our legal regime remains in place, which is basically for as long as life continues as we know it. That money is very important but that money and the potential to protect those endangered lands will be lost if we cannot get the budget implementation bill passed in the appropriate time.

I also want to talk about the $30 million going to the Rick Hansen Foundation. Rick Hansen is the man in motion, a great Canadian who rolled his wheelchair around the world. He is a very strong personality and a great activist for his cause of spinal cord research. He suffered an injury but he showed that it did not hold him back and he did his around the world tour. I think it was in 1984 when he started his tour, which was an inspiration to all of us. The ongoing work of the foundation from the money he raised then is important. There is $30 million that we would like to see dedicated to that foundation. That $30 million would be lost if the Liberals have their way and they delay and obstruct this bill past the deadline we are dealing with.

For all of those reasons, the budget implementation bill is very important, not just because we want to see it passed, and that is a good reason, but there are actual, real consequences with a ticking clock, because of the fact that a significant amount of the funds are anchored in the previous fiscal year before March 31. That means we have to pass it before the books are closed. Basically we have to get royal assent. We have to get it all the way through before the folks here on Parliament Hill go home to their ridings for the summer. In order to do that, we want to see the potential to deal with this bill for as long as we need to.

I might add that we had hoped to be debating many other bills but the Liberals have chosen to delay this budget implementation bill in every way possible and for as long as they can, as we have seen in the House today and as we saw last Friday and so on. We have tried other measures to speed things along but they have stepped in to block them every time.

The other important bill that we need to deal with is Bill C-23, a Criminal Code amendment. Our justice agenda is very important, and Bill C-23 is a bill to update the Criminal Code provisions. It has come back to the House from committee and it is now at report stage. We would like to deal with that quickly but we will need some time in the House.

Similarly, we are expecting to see Bill C-11 on transport come back from the Senate with amendments. We will need to see whether this House agrees with those amendments or not. Bill C-11 is an important bill that has been around a long time, as members can see by the number, and we have been waiting for about a year to deal with it.

We also have Bill C-31, the election integrity bill. It is in the Senate and the Senate has indicated a desire to make some amendments to the bill. We and, I think, all parties would like to see that bill in this place, or at least three of the parties in the House would. The bill was amended at committee and we, as the government, accepted the amendments proposed by the Liberals and the Bloc.

Unfortunately, the Liberals in the Senate had a very different view of how the bill should work from the Liberals in the House of Commons. The Liberals in the Senate are actually getting rid of the House of Commons Liberal amendment on how to deal with the lists and the disclosure of information to political parties. They actually changed it to a position that was identical to what the Conservatives had originally proposed at committee.

As a result of the Liberals in the Senate deciding that they do not agree with the Liberals in the House of Commons, it means that we as the House of Commons need to deal with that bill one more time once the Senate has dealt with it.

We are waiting for that little ping-pong game between the Liberals in the Senate and the Liberals in the House of Commons to come to an end. When it does end, hopefully we can achieve a resolution on which we can all agree to ensure that future elections will proceed with a greater degree of integrity and probity, something that is very important to all parties and all members of this House.

Another bill that has come back after a long stay at committee is Bill C-42, the Quarantine Act, a very important bill on health matters and something we would like to deal with.

I know of one bill that the opposition House leader, the member for Wascana, has been very generous in showing a willingness to fast track and deal with very quickly and we are hoping to have it at report stage in the House very soon. I think we are in a position where we can do that very soon. I know other parties want some level of scrutiny so the very generous offer of the opposition House leader was one that we took up, but not everybody did. We can seek to get it passed through as many stages as possible in the House as quickly as possible. The bill I am talking about is the one dealing with Olympic symbols. I would like to see it dealt with on the House of Commons side and then go to the Senate.

That is an important bill for the folks who are putting together the 2010 Olympic Games in Whistler and Vancouver. It is important because it deals with copyright, trademarks and the like. We all know how challenging it is to put on these kind of games in this day and age and the ability to protect copyrights, to deal with merchandise and to generate that revenue to support the athletes, the games and the legacy venues that will be constructed as a result of that is important to the people who are involved, whether it be the athletes, the organizers or the people in those communities who will benefit from the legacies.

We are also waiting on other bills, such as Bill C-51, the Nunavik Inuit land claims, and Bill C-59 on video piracy. Bill C-59 was just introduced but the newspapers are saying that it is an important bill because it would create some meaningful consequences for people who engage in the illegal video taping of major films with the ultimate objective of putting them on the black market to sell them illegally without the copyright rights to it. That is something that has been hurting the film industry.

In places like Vancouver and Toronto, in fact all across the country, the film industry has become very important, but those places in particular. It is important that Canada maintains its credibility within that industry and that we support our artists and the people who give value to that intellectual property and that we show leadership as a country in protecting it.

In the future, as we move away from manufactured goods and products to the kinds of services that have more to do with intellectual property, we need to be seen as real leaders in that regard. As I said, media reports are suggesting that all parties actually support Bill C-59, which is why we would like to move it quickly.

Another bill that we recently introduced would support the Red Cross/Red Crescent in the adoption of a new symbol. We need to do that here in Canada through legislation because of a charter that exists. The bill would create an additional non-denominational symbol, which is the Red Crystal, that can be used through ratification of a treaty. If the Red Crescent symbol or the Red Cross symbol creates some discomfort with the local population, the Red Cross/Red Crescent Society would be able to use the Red Crystal symbol as an alternate symbol, which is why as a country we need to recognize and ratify that it would have all the protections under the Geneva convention so that anyone would respect it. However, there would be consequences if people misused the symbol in trying to conduct an offensive military operation. The symbol would need to be used for the purpose intended, which is to protect and save lives in difficult scenes around the world.

All of the bills I have spoken about are on the House calendar. Some are in front of us and we would like to deal with them but others are still at committee.

I did not even speak to the first nations land management, which is a bill that was launched in the Senate.

We would like to see the passage of some bills that are still in committee and which we would like to see back from committee. We thought some would come back a little bit sooner, such as Bill C-6, the amendments to the Aeronautics Act. The committee has been doing clause by clause on Bill C-6 for almost a month now. I am glad to see that the committee is being that attentive but it is a bill that is important and we would like to see it.

The bill that I hope the committee deals with soon is Bill C-32 on impaired driving. I have spoken about the importance of justice and making our streets and communities safer. It was one of the five cornerstone priorities of the Conservatives when we ran in the last election. It was restated on January 4 by the Prime Minister as another priority.

I should acknowledge that we have had some good progress on getting some of those justice bills through the House but it was not easy. Some of them, like Bill C-10 dealing with mandatory penalties for gun crimes, stayed at committee. If one were to listen to politicians speak, one would think there is a consensus on the importance of mandatory penalties for gun crimes. Even the Liberal Party in the last election had that as one of its key elements in its platform.

However, when it came to committee, things were a little bit different. The Liberal Party actually gutted the meaningful parts of the legislation and it held up the legislation at committee for 252 days. Fortunately, that time is past and, thanks to the support of the New Democratic Party, we were able to put some teeth back into that legislation and make it meaningful. The legislation now contains some meaningful mandatory penalties for those gang members and crooks who want to terrorize our communities with guns and commit violent acts. They will face real consequences. When they commit an offence like that they will go to jail. There will be no more “get out of jail free” card and no more house arrest as a solution. They will actually serve real jail time for some of those offences. Where there already were mandatory penalties, they will be tougher and stronger mandatory penalities so that we can take real action.

I know these are important justice issues for Canadians, and that the gun legislation is a part of it, but the other bill that we are waiting for from committee is Bill C-32 on impaired driving. It is very easy to deal with impaired driving on alcohol right now because we have breathalyzers and standards. However, a much more difficult element is driving impaired through the use of other illegal substances, such as controlled or narcotic substances, or, in simple terms, drugs. People who use and abuse drugs and then proceed to drive a vehicle are just as impaired, if not more impaired, as someone who has consumed excessive alcohol. The consequences in terms of the risk to other drivers on the road are just as great. It can change the lives of a family if someone were to die or become injured. The lives of a family could be absolutely shattered when an accident occurs because of that kind of behaviour.

Atlantic AccordOral Questions

June 11th, 2007 / 2:30 p.m.
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Whitby—Oshawa Ontario


Jim Flaherty ConservativeMinister of Finance

Mr. Speaker, as I am sure the member opposite knows, Nova Scotia and Newfoundland and Labrador are in a unique position, together, because they had accords.

Newfoundland and Labrador and Nova Scotia can operate under the previous equalization system until their agreements expire, but can permanently opt into the new system at any time. That is the reason for the provision in Bill C-52, to create that option for those two provinces.

The BudgetOral Questions

June 11th, 2007 / 2:15 p.m.
See context

Saint-Laurent—Cartierville Québec


Stéphane Dion LiberalLeader of the Opposition

Mr. Speaker, when the finance minister announced the end of federal-provincial bickering, he did not say that meant “we will sue you if you disagree with us”.

Can the Prime Minister tell this House what is in clauses 80, 81 and 82 of Bill C-52?

Budget Implementation Act, 2007Government Orders

June 11th, 2007 / 12:30 p.m.
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Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC

Mr. Speaker, I am pleased to speak today to Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007.

As vice-chairman of the Standing Committee on Finance, the committee and I had the opportunity to study the bill in detail and we heard from numerous witnesses on some of the bill's more contentious issues.

For the past 16 months, one of my major grievances with the government has been its lack of vision. Since my time on Parliament Hill, I have never seen a government anger and disappoint all sides of the political spectrum the way this Conservative government has. It has not only managed to alienate its former supporters but it has also failed to endear itself to its adversaries.

At several points during its mandate, the Conservative government enacted piecemeal legislation that had not been well researched, developed or consulted upon. It has botched several files, most recently the Canada summer jobs program where hundreds of community organizations were left without funding. Even worse was the fact that these groups had no contacts and could not receive straight answers from the ministry because of government mismanagement.

First the Conservatives cut the program and then they reintroduced it but with less money. They received thousands of complaints and put more money into the program. At this point we still do not know which group is getting funding and how much. This is just another example of how far removed Conservative values are from the values of most Canadians. It took intense pressure from this side of the House, as well as protests from groups across the country, to get the government to backtrack on its ill-conceived plan and to reinstate funding to non-profit community groups across Canada.

I have spoken to the budget on several occasions and have highlighted all my preoccupations with the Conservatives, mainly that they lack any vision whatsoever and look only to immediate, political gain instead of long term goals for Canada. A perfect example of this are the green levy and the auto eco-rebate. Those are the only green initiatives contained in the budget and they were developed without any consultation with the automotive industry.

Encouraging Canadians to purchase fuel efficient vehicles is a step in the right direction, but an additional tax on certain vehicles is not the answer. In fact, it is a simplistic solution to a complex situation that instead requires a multi-pronged and careful approach.

According to testimony the committee heard from both industry and environmental groups, the proposed green levy and auto eco-rebate will fail to produce any meaningful change in reducing carbon emissions. These programs damage domestic automakers by placing $67 million worth of levies on domestic vehicles, which is about 80% of all the levies that will be collected. The transfer of $47 million in benefits to one company, which is 75%, for one vehicle that is produced offshore.

We should remember that when Canada imports foreign cars, greenhouse gases are produced by ships that cross the ocean to get them here. The more cars Canada imports, the more emissions the ships produce. Therefore, when the government offers a feebate benefit to only one foreign produced car, not only is it discouraging people from buying cars made in Canada, it is also encouraging increased emissions from a greater volume of imports which essentially cancels out the emissions difference the rebated cars produce.

Only three of the twenty-one eligible cars under the feebate program are made in Canada. While I do not want to give cars that are not fuel efficient an easy pass, I do think the government should not be punishing Canadian automakers at a time when our industry has suffered so many job losses in the last decade.

2006 marked the first time in 18 years that Canada had an automotive trade deficit. This was down from a $15 billion trade surplus only seven years earlier. In those seven years, Canada has gone from being ranked number four in auto assembly worldwide to being ranked number nine in 2006.

Companies such as Ford, Chrysler and GM account for eight out of every ten auto workers in Canada. However, with these measures in the budget, Canadian workers are being punished. These measures also damage the Canadian economy segment in vehicles. The $1,000 rebate for one vehicle, which makes up half of all rebates, undermines the ability of other dealers and manufacturers to sell equally beneficial subcompacts competitively on the same basis. Perhaps the biggest failure of these measures is that they fail to help get older cars off the road.

The majority of greenhouse gas emissions produced by Canada's on road fleet of cars are produced by older vehicles. There are significant differences between the amounts of emissions a 1990 model creates as compared to its 2007 counterpart. The Conservatives were better off putting more money and more energy into getting older cars off the road than they were by punishing new cars.

Recently, the finance minister has been quoted on committing another flip-flop by announcing that he would reconsider the way that the green levy and the auto ecorebate would function. This is a good sign, but it is too vague to have much meaning.

During the clause by clause of this bill in committee I put forward a motion to remove the clause dealing with these measures in order that the government would be able to rethink its policy on this issue, but without success. I only hope that the minister will stay true to his word and look at alternative measures to deal with the auto industry. These measures should not punish Canadian automakers which is currently the case, and should emphasize getting older cars off the road.

As I mentioned earlier, these vehicle feebates were some of the only green initiatives contained in the budget. The Conservative government is failing to protect the environment and Canadians are getting fed up.

The environment minister has attempted to douse the fires by putting together more piecemeal legislation but, guess what? That has also failed. By not consulting environmental groups the government demonstrated its arrogance and its ignorance on the issues of climate change and the environment.

One specific example that was raised during the finance committee study of this bill was in the crucial area of ocean conservation. The government has reduced the budget of the Department of Fisheries and Oceans by $105 million and has only allocated $18 million over two years to the conservation of oceans in our economic zones.

It is a sad statement when experts agree that it will take over $100 million per year to get Canada on track to meeting its international commitments in ocean conservation.

In 2005 the Liberal government announced the Canada's oceans action plan and had begun allocating money when a premature election was called. Since coming into power the Conservatives have mismanaged all environmental files, but perhaps they have done the most horrendous job of protecting Canada's oceans.

Canada has only protected less than 1% of our economic zone and with the Conservatives in power that figure will surely not improve. I cannot understand how the Conservatives can spend millions of dollars buying military equipment to protect Canada's Arctic region, but allocate practically nothing to protect the Arctic Ocean.

They can spend millions on patrol boats, but refuse to allocate money into protecting our oceans, which directly employ approximately 98,000 Canadians. Seafood exports account for about $5.5 billion of our economy, yet the government does not deem the oceans important enough to properly fund their conservation.

These measures contained in the budget have not endeared the government to environmentalists and we can forgive climate change experts for doubting the Prime Minister's new found devotion to the environment. We can also forgive these same experts for going one step further and calling the government's environmental plan a fraud and sellout.

As I was saying, the Conservatives have not only raised the ire of the left, but they have turned their backs on their allies on the right. I am talking of course about the energy sector in Alberta and its dissatisfaction with the government's decision to tax income trusts. I suppose that when he came into power in 2006, the Prime Minister never imagined that the Liberal Party would come to the defence of so many energy corporations in Alberta and the way in which they want to structure themselves.

The Prime Minister and the Minister of Finance delivered a low blow to investors and corporations when they blindsided them on Hallowe'en with a 31.5% tax rate on income trusts.

Several months ago, the Standing Committee on Finance tried to understand how the government calculated the so-called tax leakage in the income trust sector. After the committee was repeatedly denied access to these documents, it came to the conclusion that the government's decision to tax income trusts was based on imprecise data and was another case of mismanagement. Unfortunately, the Conservatives' mismanagement of the income trust matter cost Canadian workers $25 billion. These working people had found a high performance investment mechanism for their retirement. From one day to the next, the Minister of Finance destroyed years of savings. And the government has the audacity to claim that this measure is part of its tax fairness plan. I do not see what is so fair about liquidating Canadians' savings or the consequences of this decision to the energy sector in Alberta.

Small oil companies are having trouble because of reduced access to capital. These companies are using all of their resources just to stay afloat. That means that they have less to invest in reducing greenhouse gas emissions and making their production systems more environmentally friendly. Moreover, the income trust decision is threatening our energy corporations. They are at risk of being taken over by foreign interests. Recently, we have seen a number of takeovers and takeover attempts by foreign companies, which will weaken the Canadian economy and reduce the government's tax revenues. Rather than help Canadian companies, the government has hurt our industry and has made an unprecedented number of foreign takeovers possible.

The Liberal Party proposed a fair solution to income trust taxation. It was a solution that experts, businesses and investors agreed on. Unfortunately, the government ignored our proposal, which was rejected by the Standing Committee on Finance. Then the Liberal members proposed adopting the Bloc Québécois' income trust amendment. The amendment would have extended the grace period from four years to 10. Thanks to Liberal support, that amendment would have been passed had the Bloc members not changed their minds and voted against their own proposal. This proves that the Bloc Québécois has no useful solutions to offer to Quebeckers and that it is not protecting Quebec's interests.

During a meeting of the Standing Committee on Finance, a Bloc member said:

Let's not forget that when we examined the report, the bill had not been submitted to us. We wanted to find the best possible solution. However, in the present context, what we really hope for is speedy passage of the bill so that the budget can be implemented as soon as possible.

In other words, the Bloc members are here for the sole purpose of protecting their own interests. An amendment could easily have been adopted to allow Quebeckers and all Canadians to benefit from a four- to 10-year grace period. After speaking out so vigorously against taxing income trusts, the Bloc members changed their minds. Moreover, they lack courage when real changes have to be made.

I doubt that the many people who have invested in income trusts in Quebec and Canada are pleased with the Bloc's about-face.

Another area where Canadians will be feeling the crunch from Conservative mismanagement is set to begin as the summer gets underway. With Canada's tourist season in full swing, a thriving section of our economy must deal with the elimination of one of its greatest selling tools, the visitor rebate program.

The program gave Canada's tourism industry a valuable tool to help it compete for global tourists. Once again, without any consultation with the tourism industry, the government eliminated the program. Only a small handful of developed nations do not have a federal sales tax rebate program for tourists. Thanks to the Conservatives Canada can count itself among these few. It is difficult to understand why the government wants to weaken Canada's tourism industry since so many Canadians are dependent on this industry.

After the special finance committee's hearing requested by Liberal MPs to study the visitors rebate program, and along with the help of industry stakeholders, the continued pounding of the government on its ill-developed decision finally convinced the finance minister to announce a federal foreign convention and tourist incentive program in Bill C-52. That measure in the budget partially corrects the mistake made by the government when it first eliminated the GST rebate program, but it does not go far enough.

Why was the government determined to destroy a program that worked as it did with the Canada summers job program? The argument surrounding the GST rebate could not be timelier as summer is now upon us. I am glad to see some reversal by the government on this matter, but there is another set of seasonal problems for which the government must account.

As we know, summertime is also a season of festivals in Canada. My hometown of Montreal is host to an endless number of world renowned festivals which draw millions of visitors each year. Anyone who has seen the international jazz festival and the just for laughs festival understands how important festivals are to Montreal's economy. I wonder if the current Minister of Canadian Heritage and Status of Women has been to Montreal during festival season because her actions have led us to believe otherwise.

Just a few weeks ago, the presidents of Montreal's two largest festivals spoke out against the minister's lack of action to secure funding in time for the summer. Festivals are a huge economic boost to local economies across the country and the minister's inability to assure funding for these festivals is a complete failure on her part and on the part of the government. I cannot understand how the Conservatives can mismanage such an obvious and crucial file such as this one.

Art groups across the country have been criticizing the government for months about the disastrous underfunding of the arts. Cultural groups in the country have felt insulted and ignored by the government and it has caused well-known authors and artists to speak out. We cannot allow Canada's vibrant arts community to suffer under the Conservatives' ideological program cuts and mismanagement.

We have already seen them mismanage countless files by closing Liberal programs and then reopening them only a few months later under a new or different name, whether they wanted to take credit for these supposedly new programs or whether they just thought that no one would notice that they were gone remains unclear.

This began in September 2006 when the Conservatives cut a number of effective Liberal programs. The Liberal Party protested these ideological cuts, as did the public. Since then we have seen the government re-announce these programs under new names and pretend as if the Liberal initiated programs never existed.

Canadians deserve better than what the government has given them, ill-conceived, piecemeal programs that will not help Canada advance into the 21st century. The government is much better at photo ops and slander than it is at governing and our country is not any better for it.

Budget Implementation Act, 2007Government Orders

June 11th, 2007 / noon
See context


Peter Julian NDP Burnaby—New Westminster, BC

Mr. Speaker, I rise to speak to Bill C-52, the Conservative government's budget. I am unfortunately the first person to rise after the tawdry, cheap events of last Friday in the House, the unparalleled, unprecedented, tawdry events of a government that is so desperate now to get its budget through it had to go down into the bowels of the House of Commons to look through dusty books, looking back to the 1960s and the 1970s, to find some sort of procedural trick that would allow it to pass the budget when it knew that most Canadians are opposing it. In the last few days we have seen the budget self-destruct, as many of the Atlantic provinces, Saskatchewan and many Canadians from coast to coast to coast have said very clearly that the budget is manifestly not in the interests of Canada.

Last Friday, with two minutes to go in private members' business, the House leader stood to try to conjure a trick out of his pocket and try to force through, what he called “a national emergency”, the budget, without a vote, not complete the debate only to force it through.

As members well know, the House refused that. However, the fact that the Conservatives would use such a cheap and tawdry trick to try to get their budget through I think belies the reality. The Conservatives acknowledge now that their budget does not have the popular support of Canadians. As a result of that, they had to resort to this trick.

What they used was a procedural trick to try to declare this a national emergency. The only emergency is the rapid and constant fall of the Conservatives in public opinion polls. We have seen in places like British Columbia, Saskatchewan and Nova Scotia that the Conservative vote continues to erode. Why does it continue to erode? Not only because of tricks like that, the trick of last Friday, a trick that manifestly failed, but also because their budget simply does not have credibility.

I will talk a bit about the situation that Canadians are really living through while the Conservatives are playing their little political games here in Ottawa. From there, I will talk about how the budget does not address what are very clear concerns, crises that are occurring in main streets across the country.

Instead, very clearly what we have is a Conservative budget, a Bay Street budget, the same as the Liberal budgets were, oriented toward corporate tax cuts and huge handouts, shovelling money off the back of a truck through the oil and gas sector. That seems to be the Conservative priorities. Canadians are living a much different reality.

Let us talk about the reality of most Canadians. Let us talk about average family incomes. Since 1989, Statistics Canada tells us, since the signing of the Canada-U.S. free trade agreement, most Canadian families have seen their income fall. They are earning less money now than they were then.

What we have seen under now more than 15 years of Conservative and Liberal economic policies is the wealthy are fabulously so. They are able to buy their 15th or 16th Lamborghini without any problem. However, most Canadian families are earning less. It is not just that they are working harder and longer weeks, and I will come back to those statistics, the bottom line is Conservative and Liberal economic policies have manifestly failed.

Let us look at the figures. The poorest of Canadians, the family with an income of less than $20,000 a year, those below the poverty line, have seen over this 15 year period the loss of about a month's income. What they used to earn in 12 months, they are living on 11 months' worth of income. We have seen a 10% fall in real income for the poorest of Canadian families.

The Conservative budget does absolutely nothing to address that catastrophic fall in Canadian income levels for the poorest of Canadian families. It is no secret, 300,000 Canadians will be sleeping in the parks and main streets of our country tonight, 300,000 Canadians who no longer even have the resources to have a roof over their heads. The Conservative budget does absolutely nothing to address the crisis in homelessness and the catastrophic fall in the incomes of the poorest of Canadians.

Let us go to the next group. Another 20% of Canadians, and let us call them the working class, are families earning less than $36,000 a year. They are now earning two weeks' less income than they were in 1989.

In other words, after 15 years of Liberal and Conservative economic policies, they have seen their incomes fall so that they are now living on 50 weeks of income, whereas they used to live on 52 weeks of income. They have actually lost two weeks of income and are trying to make ends meet with far fewer financial resources.

Let us continue on to the middle class. It is the same thing for families earning less than $56,000 year. They are now earning two weeks' less income than they were in 1989.

We now are talking about 60% of Canadian families who are struggling to get by on fewer and fewer financial resources. The Liberals did absolutely nothing to address this. They simply shovelled money at the wealthiest of Canadians. The Conservatives now are doing exactly the same thing.

Even higher income earners, the upper middle class, have actually seen no income improvement since 1989.

That is 80% of Canadian families who see stagnation or who have seen increasing impoverishment under the watch of those parties over the last more than 15 years.

Who has profited from the Canada-U.S. free trade agreement and NAFTA and from the Conservative and Liberal economic policies shovelling money at the corporate sector? There are unbelievable amounts of resources to give to the oil and gas industry and the banks, and to give in corporate tax cuts, but who has profited? Only one sector has: the wealthiest of Canadians. In fact, Statistics Canada tells us that it is the wealthiest 5% of Canadians who have seen their incomes skyrocket over this period.

What the people who are listening to us today or who read these remarks in Hansard say, what the people say certainly as we knock on doors in my neighbourhoods, is that they cannot understand why Ottawa does not get it. Why it is harder and harder to make ends meet, they say, and yet the government seems to want to favour the wealthiest of Canadians with corporate tax cuts? They say that the government does not seem concerned about ordinary, hard-working Canadian families. They ask that question.

We have seen the Conservative response. The Conservatives' response was a cheap conjuring trick to try to get their budget through before Canadians wake up to what an appallingly negative impact it will have on them.

The Conservative government erodes resources in health care. It does not do anything to open up doors to post-secondary education and training. It throws a few dollars here and there but does not address the underlying systemic problems in this Confederation, which has led to the fact that most Canadian families are falling further behind and most Conservative and Liberal economic policies are favouring that small proportion of Canadians who have everything they could possibly want.

What is wrong with this picture when the top 5% of Canadian income earners receive most of the attention of Conservative and Liberal governments? Those governments simply shovel money at them. What is wrong with this picture when ordinary working families are forgotten?

I have talked about the fact that income levels are actually falling while the Conservatives have this delusion that everything is just peachy-keen. They say that because they look at the job figures. The job figures from Statistics Canada actually prove the point: the jobs that are created today are not sustainable manufacturing jobs or family-sustaining jobs. They are part time and temporary jobs. They are jobs paying the minimum wage.

Every time the finance minister stands up and says that we have full employment, what he is actually saying is that we have full employment like most third world countries have full employment. Canadians are scraping to get by on minimum wage, part time jobs and whatever temporary contracts they can get. They are struggling to keep a roof over their heads. The finance minister does not recognize that the economic policy of the past 15 years has actually led to a steady impoverishment.

It is not because Canadians are not working harder and harder. The Community Social Planning Council of Toronto produced a study just a few weeks ago which indicates that for the average family raising children the annual number of hours worked went up by 200 hours, that is, the average family worked 200 hours more in 2004 than in 1996.

What this means is that the average Canadian working family is working five weeks more. Those families are trying to jam another five weeks of work into a working year. They are struggling. They are putting in an unprecedented number of overtime hours, yet their revenue levels are lower than they were in 1989. What a destruction of our quality of life. What a failure on the bottom line.

Canadian families have seen their incomes tank, yet they are putting in five weeks more of labour in a 52 week year. It is an annual average of 200 hours more worked in 2004 than in 1996. It would be even higher today. Overtime hours have gone up by over 30% and yet most Canadian families are earning less now than in 1989.

That is what is fundamentally wrong with how the Liberals and Conservatives have addressed economic policy for the past more than 15 and nearly 20 years. They simply do not understand the impact of their policies. They are economic illiterates. They cannot check the bottom line to see if the economic policies have actually made sense. They are shovelling money at the corporate sector with more and more corporate tax cuts when we already subsidize the corporate sector to an unparalleled extent through the subsidies we provide to medicare.

Our medical system now in place offers a competitive advantage that no American corporation can match, yet the corporate sector is continuing to request lower and lower tax rates when our subsidies already give them a very clear competitive advantage. What is wrong with this picture when the corporate sector fails to acknowledge that the hard work of Canadians from coast to coast to coast gives the sector a competitive advantage but that corporations have to pay their fair share of taxes in order for that competitive advantage to be sustained?

They cannot have their cake and eat it too. Corporate leaders need to be told that. They need to be told that they have to be responsible, and that since we are already subsidizing them to an unparalleled extent, with study after study showing that medicare is a huge competitive advantage when Canadian companies compete with American ones, they cannot at the same time have lower corporate tax levels than they have in the United States. They cannot have both. They have to make clear and responsible choices.

We have not seen those responsible choices from the Liberals. We certainly have not seen them from the Conservatives, and last Friday in particular attests to that, but things have to change and that is certainly why more and more Canadians are looking to park their votes with another political entity. We certainly are seeing a greater interest in new ideas. The NDP, of course, since its inception, has always been the birthplace of new and responsible ideas, whether they are economic or financial in nature or in terms of social policies.

Before I move on to the next portion of my presentation, I do want to say one thing. The ministry of finance actually charted NDP, Liberal, Conservative and even the Parti Québécois governments over a 20 year period. It charted and compared the actual year-end fiscal returns to the budgetary promises of each of those governments.

This was done by the federal ministry of finance, which we certainly could not say is an NDP ally in any way, but that long term study, the only long term study that has ever been undertaken on this phenomenon of what the actual fiscal period returns show, clearly proved that the NDP as a party and NDP elected officials as individuals are the best fiscal managers. The worst were the Liberals. No matter what their promises are, 86% of the time the Liberals actually run a deficit. The Conservatives were a little better, actually running deficits 66% of the time over that 20 year period.

The NDP projected surplus or balanced budgets most of the time, and most of the time we actually achieved that. There is no difference between the spin and the results, between the rhetoric and the reality. We actually perform better in terms of fiscal management than Conservatives or Liberals. No wonder Canadians are looking around now and taking a hard look at what political parties promise and what they actually deliver.

The NDP is the only party that actually addresses the economic reality of most Canadian working families and we are the best financial managers. Those are two reasons why we are seeing increasing interest in our party.

Before I move on to B.C. issues, I want to mention the catastrophic collapse of our manufacturing sector. We have trade policies from the government, like we did from the previous government, which do not address the fact that value added and manufacturing production is collapsing across this country. A quarter of a million family-sustaining jobs have been lost in the last few years under the Liberal watch and under the Conservative watch.

Let us look at some of the impacts of that manufacturing loss. In Nova Scotia, 20% of manufacturing jobs have been lost. In Quebec, 18% of manufacturing jobs have been lost. In Windsor, and we have had very eloquent testimony to this effect from the member for Windsor—Tecumseh and the member for Windsor West, we have actually seen 35% of manufacturing jobs lost.

Windsor is in crisis. Southern Ontario is in crisis. The minimum wage, part time jobs that the finance minister is offering do not in any way compensate for this hemorrhaging of manufacturing jobs.

In Toronto, over 100,000 manufacturing jobs have been lost. That is 21% of manufacturing jobs in Toronto. In Oshawa, it is 21%. In Thunder Bay, it is over 20%. We are seeing a hemorrhaging of manufacturing jobs across this country and there is nothing in the budget that addresses this crisis.

We have a variety of crises that have developed over the past 15 years under the Liberal watch. The Conservatives said they would take a completely new approach. Instead, they have taken exactly the same do nothing approach, a shovel money at the corporate sector approach, which has not addressed the catastrophic fall in manufacturing jobs. It has not addressed the very real erosion of family income since 1989 and the signing of the Canada-U.S. free trade agreement.

This approach does not address the homelessness crisis. It does not address the inability of most families to have their kids or adults move on to post-secondary education, apprenticeship and training. It does not address that crisis. It does not address the health care crisis. Instead of dealing with the underfunding of our public health care system, we have seen the Conservatives take exactly the same road as the Liberals and look to more privatization.

We know that in the United States more privatization means more costs and fewer benefits. The United States health care system costs twice the amount per capita that the Canadian system does and yet 60 million Americans at any point in one year will have absolutely no health care coverage whatsoever. It is a failed American model that the Conservatives are pushing, as the Liberals did before them.

As I come from British Columbia, I would like to move on now to the budget and what it does not do for British Columbia. The finance minister rose in this House and said that his Canada went from the Alberta Rockies to Newfoundland and Labrador. He completely excluded British Columbia.

I admire his honesty, because there is nothing in the budget that addresses clear Conservative promises to B.C. The Conservatives said they would deal with the leaky condo crisis. The Conservatives promised they would take action on that. Instead, they have left 60,000 British Columbia families with absolutely no support in the leaky condo crisis.

With softwood lumber, we have seen the complete disregard for softwood communities in British Columbia and elsewhere.

Regarding the pine beetle issue, the Conservatives promised and spun but they did not provide the funding. The Kamloops Daily News said the following just last Friday on the pine beetle, “When will [the government] come to the table and be a part of the solution?” For whatever reason, the feds just do not get it on the pine beetle. We have seen devastation throughout the interior of British Columbia. The government has done absolutely nothing to address that.

I could go on, with the World Police & Fire Games and a whole host of other issues such as the flooding in the Fraser River and the Skeena district of British Columbia. We have seen only $16 million offered up for the flooding even though we know that $22 million is required just to protect the city of Chilliwack alone.

I could go on and on but the reality is that the Conservative government just does not get it, which is why it tried to force this budget through by a conjuring trick last Friday.

The House resumed from June 8 consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the third time and passed, and of the motion that this question be now put.

Suspension of Certain Standing Orders--Bill C-52Business of the HousePrivate Members' Business

June 8th, 2007 / 2:20 p.m.
See context


Sukh Dhaliwal Liberal Newton—North Delta, BC

Mr. Speaker, today I was supposed to attend a convocation at Simon Fraser University in my riding, but I saw the tactics being played by the meanspirited Conservative government. The Conservatives ran on issues of accountability and transparency. I am on the access to information committee and I see how the Conservative members operate on that committee.

Today the Conservatives are saying the debate on Bill C-52 is urgent. The reason is very simple. The Conservatives want to kill two important issues, the Kelowna accord and the Kyoto accord. Canadians fully support those accords. The Conservatives want to prorogue the House after pushing the budget through, so that these two important issues will die on the order paper.

If the Conservatives really believe in democracy, transparency, credibility and accountability on which they ran, they should debate this issue to the fullest. They should be transparent and open to Canadians and not act in this scandalous way. A situation such as this one is totally scandalous.

There is not a single member of Parliament on that side of the House who will be able to face his or her constituents on this issue. They are trying to push through the budget legislation on a Friday afternoon.

Suspension of Certain Standing Orders--Bill C-52Business of the HousePrivate Members' Business

June 8th, 2007 / 2:15 p.m.
See context


Mario Silva Liberal Davenport, ON

Mr. Speaker, I was at my desk when the chief government whip put this motion forward and, if my recollection is correct, I do not believe you stated whether there were 10 members in the House who would rise. It was after the fact. I think that is what I heard.

If we are to believe that the procedures of the House do matter and that the government and the House want accountability, then I believe, Mr. Speaker, that you have an obligation, before making a ruling, to ascertain whether there are 10 members in the House who have objection to this.

I am very concerned about the government raising this as an urgent matter. The government had all the levers of power and all the mechanisms available to it to introduce Bill C-52 any time it wished. It had the last two weeks to do that but it did not. For the government to wait until the last minute on a Friday afternoon is quite shocking to me. If the government really cares about accountability, it should not be trying these types of sneaky manoeuvres.

Mr. Speaker, I have been here listening to you and I do not believe that you have made a ruling. I would ask that you at least ascertain whether there are 10 members present who object to this.

Suspension of Certain Standing Orders--Bill C-52Business of the HousePrivate Members' Business

June 8th, 2007 / 2:05 p.m.
See context


Ralph Goodale Liberal Wascana, SK

Mr. Speaker, this proceeding is impaired to a considerable extent because, until a moment that is just about to arrive, copies of the motion that was put before the House have not been available to any members of the House in order to deal with the subject matter. I had asked for a copy of the motion and it was provided to me and then taken away. I would like to have the copy again returned to me forthwith so I can see the language of what is being proposed here.

It seems to me that a condition precedent for this matter to proceed to the floor of the House of Commons is this question of urgency. The proceeding under Standing Order 53 specifically contemplates that the matter be urgent. In fact, the Chair is not in a position to even consider this item until the issue of urgency is established. The fact is that the motion does not, on its face or in anything that has been said so far, establish the condition precedent of urgency.

Let me inform members of what the motion says. It reads, “Given we ran out of time today to complete the debate on Bill C-52 and given that the failure to adopt Bill C-52 by both Houses before we adjourn for the summer will result in the loss of $4.3 billion in 2006-07 year-end measures...”, et cetera.

This is hypothetical. This is trying to anticipate events a full two weeks into the future.

The fact is that the issue is not urgent. Bill C-52 has been before the House of Commons for some time. However, let me point out that this Parliament began in the last week of January. The government did not bother to present a budget until March 19. It did not bother to present the budget bill until the end of March. How can it now argue, with two weeks more to go, that it is urgent?

Suspension of Certain Standing Orders--Bill C-52Business of the HousePrivate Members' Business

June 8th, 2007 / 2:05 p.m.
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Vivian Barbot Bloc Papineau, QC

Mr. Speaker, on behalf of the Bloc Québécois, I must say that even though we support Bill C-52, we strongly object to this use of Standing Order 53(1). With respect to the matter at hand, we do not agree with how the procedure is being used and we are not at all interested in whether or not there is a precedent in this case. We would ask that you reconsider your decision.

Suspension of Certain Standing Orders--Bill C-52Business of the HousePrivate Members' Business

June 8th, 2007 / 2 p.m.
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Jay Hill Conservative Prince George—Peace River, BC

Mr. Speaker, perhaps it would help if we read Standing Order 53 in its entirety, but I do not intend to do so. As I pointed out, Standing Order 53.(3)(a) states that “the Speaker may permit debate thereon for a period not exceeding one hour”.

You did call the question. Fewer than 10 members rose, and you can look for clarification from the table officers and the clerks, but I still contend that this issue is done. Fewer than 10 members rose to object to the motion and therefore the motion was adopted. Therefore, we are now going to debate Bill C-52.

Suspension of Certain Standing Orders--Bill C-52Business of the HousePrivate Members' Business

June 8th, 2007 / 2 p.m.
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Jay Hill Conservative Prince George—Peace River, BC

Mr. Speaker, also on a point of order, in my reading of Standing Order 53.(1) through 53.(5), Standing Order 53.(4) says:

When the Speaker puts the question on any such motion, he or she shall ask those who object to rise in their places. If ten or more Members then rise, the motion shall be deemed to have been withdrawn; otherwise, the motion shall have been adopted.

Mr. Speaker, it is my reading that you put the motion and less than 10 members rose in objection. Therefore, the motion has been adopted by the House and we will proceed now not with debate on the motion but debate on Bill C-52.

Suspension of Certain Standing Orders--Bill C-52Business of the HousePrivate Members' Business

June 8th, 2007 / 1:55 p.m.
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Prince George—Peace River B.C.


Jay Hill ConservativeSecretary of State and Chief Government Whip

Mr. Speaker, I rise on a point of order. Given we ran out of time today to complete the debate on Bill C-52 and given that the failure to adopt Bill C-52 by both houses before we adjourn for the summer will result in the loss of some $4.3 billion in 2006-07 year-end measures, pursuant to Standing Order 53.(1) I move:

That the House continue to sit beyond the ordinary hour of adjournment today to consider Bill C-52.

Budget Implementation Act, 2007Government Orders

June 8th, 2007 / 1:30 p.m.
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The Acting Speaker Conservative Royal Galipeau

It being 1:30 p.m., the House will now proceed to the consideration of private members' business.

When Bill C-52 returns to the House, there will be three minutes left for the hon. member for Cape Breton—Canso, plus 10 minutes of questions and comments.

Budget Implementation Act, 2007Government Orders

June 8th, 2007 / 12:15 p.m.
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The Acting Speaker Conservative Royal Galipeau

When Bill C-52 was last discussed in the House, there were 17 minutes left for the hon. member for Nanaimo—Cowichan, and she has the floor.

The House resumed consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the third time and passed, and of the motion that this question be now put.

Budget Implementation Act, 2007Government Orders

June 8th, 2007 / 10:55 a.m.
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Jean Crowder NDP Nanaimo—Cowichan, BC

Mr. Speaker, I am pleased to rise to speak to the bill. I think New Democrats have made it amply clear that we oppose the bill.

I will talk about Bill C-52 from a couple of different perspectives. I think some of my other colleagues have talked about health care, transportation and some of the needs of Vancouver Island north. I will focus on some other issues in British Columbia and talk about first nations, Métis and Inuit people in our country.

Many of us are well aware that a number of major issues are facing British Columbia, including housing, improving the provincial infrastructure and strengthening the B.C. economy. Although people will note that the B.C. unemployment rate is quite low, a number of communities are going through enormous transitions as a result of the softwood sellout.

In many of our forestry communities jobs have been lost. Last week there was an announcement in Port Alberni of another 185 jobs being lost. I know a number of the mills on Vancouver Island have faced curtailment because they could not get fibre supplied. Although some communities are doing quite well, a number of our communities are in a great deal of difficulty.

Under the new 10 province standard for equalization B.C., falls above the cutoff and will not receive equalization. Despite the increased needs, the budget does not address such things as affordable housing. I will talk briefly about Nanaimo in my riding of Nanaimo—Cowichan.

In a November 8, 2006, paper called “Advancing Social Development in Nanaimo: Directions for Moving Forward”, an organization in Nanaimo undertook to survey a number of groups that provide services. A couple of startling things came out of that which were tied to housing, employment and income.

One of the things that was noted was respondents cited the high levels of poverty, including child poverty in Nanaimo. They also stated that the community was becoming more polarized between rich and poor, with the latter having few options to improve their economic circumstances. This relates directly to housing.

One of the respondents to the questionnaire said, “Shelter is a basic need. It is the foundation upon which stable lives are built”. Respondents cited the increasing cost of housing, both owned and rental. They also cited the increasing incidence of homelessness and raised concerns about the kind of stock of market rental housing. They also noted that the market rental housing and the house vacancy rate had decreased from 3.4% in 2002 to 1.4% in 2005.

What that adds up to is an increasing number of people in Nanaimo—Cowichan cannot find a place to live.

Budget Implementation Act, 2007Government Orders

June 8th, 2007 / 10:10 a.m.
See context


Ken Epp Conservative Edmonton—Sherwood Park, AB

Mr. Speaker, I am delighted to stand in the House in order to support the bill before us today, Bill C-52.

As many members here know, I have for a long time been very interested in finances, particularly as they pertain to ordinary taxpayers, small businesses and families. This was one of the things that drew me into the parliamentary part of my life.

There are so many things in this bill that I could speak for probably several hours if the rules permitted, but I shall speak only for a short time. I would like to first of all mention my very enthusiastic support for the principle of income splitting for pensioners. This is long overdue.

Particularly in my generation, there were many families that had only a single income and that was our case as well. We made the choice that my wife, the mother of our children, would be a full time mom for our kids. I really value that. I think she probably contributed more to the well-being of our country by doing that than I did going to work every day, even though I may have gotten up at four o'clock in the morning.

I will also mention that we had perfect children. I do not know if other members did, but ours were. I know, for example, that right after they were born, I declared quite seriously that they never cried at night. They never once awakened me. My wife, on the other hand, I think may have some other stories to tell in that regard.

The bill, among other things, would allow income splitting for pensioners which would bring them into a lower tax rate. I think that is very important because most people who have made these choices also have half the income throughout their lifetime and half the pension when they retire. This is really part of the theme of tax fairness.

The other thing that is relevant here is the new tax credit of up to $2,000. Our government, this party and certainly I as an individual recognize not only the value of families raising children but also the tremendous expense that entails. Therefore, having a new tax credit of up to $2,000 is a tangible recognition of that. I applaud our finance minister and our government for introducing measures like that.

The other measure that I also support is making the equality of the spousal deduction equal to that of the single wage earner when there is but one wage earner in the home. It is another very pro-family measure that is being taken.

I do not want to sound in any way negative about this, but the money needed to support a person is really independent of whether or not the person works outside the home. In our experience, my wife actually spent as much money as I did and probably more because she managed our household expenses. As a matter of fact I used to say that we have specialization in our family. I earned the money and my wife spent it. The object of this was for me to be just a little better at my job than she was at hers. However, there definitely are expenses that are involved in the support of a spouse who is not working. To make that basic exemption equal is just a measure of fairness and I support that wholeheartedly and enthusiastically.

Because I believe so strongly and firmly in the merits of the bill, I therefore move:

That this question be now put.

The House resumed from June 6 consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the third time and passed.

Business of SupplyGovernment Orders

June 7th, 2007 / 5:50 p.m.
See context


Blaine Calkins Conservative Wetaskiwin, AB

Mr. Speaker, I rise in the House in response to the motion by the member for Labrador regarding the government's commitment to Nova Scotia's offshore accord and the treatment of natural resources in the equalization formula. The member doubts that the government has honoured its commitments. I can assure the House that nothing could be further from the truth.

Budget 2007 provides important benefits to the people of Nova Scotia as part of the Government of Canada's commitment to fair and equitable financial support for provincial and territorial health care, post-secondary education, child care, social programs and infrastructure.

Budget 2007 does even more. Nova Scotia will continue to receive 100% of offshore resource revenues, including royalties, as if these resources were on land. This fundamental aspect of Nova Scotia's relationship with its offshore resources, its ability to manage the resource, to tax and collect the royalties remains the same. This will help Nova Scotia to develop its economic potential and ensure its future prosperity.

Let me remind the House that it was a Conservative government that signed the 1986 Canada-Nova Scotia offshore petroleum resources accord, which facilitated the development of the oil and gas reserves off the coast of Nova Scotia.

In specific terms, budget 2007 will allow the governments of Nova Scotia and Newfoundland and Labrador to continue to enjoy the benefits of their 2005 offshore accords. Again, I remind the House that it was a Conservative opposition that forced the previous government to sign these agreements. The accords are unique in Canada in recognition of the provinces' unique economic and fiscal circumstances.

Budget 2007 offers Nova Scotia a positive choice for the future. It can operate under the existing equalization formula, or it can choose to opt into the new equalization formula based on the O'Brien report, if and when the province determines this as being most advantageous. By having this additional choice, Nova Scotia potentially stands to receive even higher benefits than under the existing formula while retaining its right to offset payments under the accords.

Of course, if the Nova Scotia government chooses the new equalization formula, it is only fair that the whole package would apply, including the fiscal capacity cap that is an integral part of the new equalization formula. It would not be fair to other provinces if only Nova Scotia were allowed to choose those parts of the new equalization program that benefit the province.

Finally, Nova Scotia has been given additional flexibility beyond what was set out in budget 2007. Bill C-52 would allow Nova Scotia to benefit from the new O'Brien formula for 2007-08 and provides more time to assess whether it wants to permanently opt into the new equalization formula. This option has given Nova Scotia an additional $95 million, for total benefits of $1.5 billion in 2007-08. Under this arrangement Nova Scotia will receive its full offset payments under the offshore accords.

One can begin to see the difference where it matters. In April 2007 Nova Scotia's labour force participation rate of 64% was close to a 30 year high and full time jobs have increased by 2.5% over a year ago. The economy is strong in Nova Scotia.

Canada is a sharing community. Nova Scotia's growing prosperity is in part due to strong federal support and is something to celebrate. With 100% protection of the Atlantic accords and a positive choice for the future, the province can make sustained improvements to its economic and fiscal situation for the benefit of individuals and families throughout Nova Scotia.

Here is what Charles Moore said in the Halifax Daily News:

With the federal budget having passed second reading in the House of Commons, one hopes — wistfully, perhaps — that the histrionics over the [Conservative] government's policy revision of the Atlantic Accord will die down. At least here in Nova Scotia where the new equalization deal the feds are offering amounts to a substantially more advantageous bird-in-the-hand as opposed to the pipe-dream of petro-royalty riches.

It is convenient for the opposition to isolate certain measures in the budget and, of course, with a healthy injection of partisanship, ignore the larger picture. Let us look at the benefits to Nova Scotians that the members opposite are voting against.

Restoring fiscal balance brings federal support for Nova Scotia to $2.4 billion in 2007-08 and it is more than just equalization payments. They oppose the $639 million under the Canada health transfer. They are opposed to $277 million for the Canada social transfer, including additional funding for post-secondary education and child care. The $73 million for infrastructure would be lost. The $24.2 million available to the Nova Scotia government through the patient wait times guarantee trust over the next three fiscal years would be lost. The $8.5 million available to the Nova Scotia government to implement the human papilloma virus immunization program to combat cervical cancer over the next three fiscal years potentially would be lost. The $23.2 million in gas tax funding for municipalities in Nova Scotia in 2007-08 would be potentially lost. The $2 million in corporate income tax relief from changes in capital cost allowances for buildings could be lost. The $7 million in additional corporate income tax relief from the temporary two year writeoff for manufacturing equipment over the next two years is threatened. Nova Scotia will receive $42.5 million from the Canada ecotrust for clean air and climate change.

Of course, if the budget continues to be delayed by the official opposition, many of these millions could be lost or are threatened to be lost.

We are delivering on our commitments to the people of Nova Scotia, more than any of the members opposite ever did when they were in power. They should start supporting Nova Scotians and support the budget.

Business of SupplyGovernment Orders

June 7th, 2007 / 3:45 p.m.
See context


Bill Casey Independent Cumberland—Colchester—Musquodoboit Valley, NS

Mr. Speaker, I represent the flat earth party and we have a position on this.

I am pleased today to debate this issue and I will focus most of my remarks on the Atlantic accord aspect of the debate today.

I want to address the comments made by the very distinguished member for Edmonton—Leduc who tried to provide the perspective perhaps from Alberta. However, the part of the debate that I am focused on is not whether equalization is right or wrong or what is best for this province or that province. My focus is on the fact that I think the Government of Canada should honour a signed contract.

I believe that when the Government of Canada signs a contract this should be gold-plated. It should be bulletproof. When the Government of Canada signs its name, with the little red flag, on a piece of paper, whether it is a person in Tokyo, in Moscow, in Halifax or in St. John's, Newfoundland, the person should be able to count on that signature as being solid gold.

The contract we are talking about today, the one that has been amended so much in the budget, Bill C-52, was only signed in 2005. It is a 14-year contract signed by the Government of Canada and the Province of Nova Scotia. We are only two years into the contract and the government has decided it does not like it. Consequently, the government has put 12 amendments in the budget. I want the members opposite to notice, because what they say is not accurate, but under consequential amendments there are 12 paragraphs of amendments to the Atlantic accord.

If we go further, there are six paragraphs of amendments to the offshore revenue agreement that John Hamm signed two years ago in 2005. The government is now taking the contract signed by the Government of Nova Scotia and the Government of Canada and amending it with six fundamental changes to the contract. This is simply right or wrong and I think every Canadian has an interest in this. This is not just in the interest of Nova Scotia or Newfoundland. Every member of Parliament in this House should insist that if the Government of Canada signs a document, no matter if it is a Liberal government, a Conservative government, an NDP government or, heaven forbid, a Bloc government, the Government of Canada should honour the contract, no matter what, for the life of the contract. It is not flexible and it is not amendable. I honestly think the member for Edmonton—Leduc would agree with that.

I was just given a news article containing a comment by the Prime Minister at the G-8 a few minutes ago. He commented about my voting against the budget. He talks about how good the budget is.

I do want to say that it is a good budget and it is good for my riding. Many things in the budget do support and help my rural riding. However, that does not give the government permission to break a contract. Just because the government does some good things, it does not give it permission to break a contract. My opposition to the budget and the reason I voted against it was that I am 100% convinced that the budget does break this contract.

The Prime Minister said that the budget actually gives the Province of Nova Scotia $95 million in equalization over and above the Atlantic accord, but that is not right. He also said: .

That's one of the reasons Mr. Casey voted four times for the budget so obviously I don't think much of him changing his view the fifth time.

In all fairness, he knows better than anybody that we met with him and with the Minister of Finance over and over again. We put proposals on the table and got legal opinions. We raised it in caucus and we raised it in the House. We have done everything we can.

A week ago yesterday I realized that we were not making any headway. I wrote to the Prime Minister and put it right in his hand and said, “We're not making any headway with this by working behind the scenes. I am going to start speaking out publicly”. He took exception to that. I said, “We have to put pressure on it to make it move ahead”. I gave it to him in writing. I did not want to broadside him. I waited two days and then I made my first statement. Again, we made no progress.

On Monday morning, I wrote the Prime Minister a letter and said, “I cannot support this bill because it breaks a contract between the Government of Canada and the Government of Nova Scotia and I will not vote for it”. I made it very clear. I said it in two places in the letter.

The Prime Minister knows exactly why I voted for the budget the first time. We were in negotiations trying to find a solution but they went absolutely nowhere.

The Prime Minister says that Nova Scotia will get $95 million more in equalization, but that is not true. If the Atlantic accord were honoured, it would get the $95 million, plus the benefits of the offset that are not included in this. That is the fundamental part of the problem.

We believe the Atlantic accord could be changed with four or five words. The problem is that the budget and the accord have different wording. I have pointed this out to the Prime Minister and the finance minister several times. The accord says that the calculation of the payment will be based on the equalization formula that exists at the time. Any time the Government of Nova Scotia wants to calculate its offset payment, it would use the equalization formula that exists at the time.

Now, if we change it in 2010, it is that formula. If we change it in 2015, it is that formula. If we change it in 2019, it is that formula. That is what the accord says, which is a signed agreement and agreed to by both sides.

However, if we go to page 115 in the budget, it says that from now on it will be based on the previous formula. Instead of the vision of the accord, which is to follow along as the equalization formula evolves and changes, the budget locks it in at the previous formula. It, therefore, amends and changes the Atlantic accord fundamentally.

I asked the Minister of Finance today if he would stop saying that Nova Scotia has the option of the new formula or the old Atlantic accord, because it does not. He said it a thousand times. Many of the ministers have. I said it myself, because I believed it, until I got into this. However, it is not true. The Province of Nova Scotia and the Province of Newfoundland and Labrador do not have the option of the new formula or the old Atlantic accord. Everybody in this House has heard the Minister of Finance say that a dozen times. It is not true because the budget changes both Atlantic accord agreements. Twelve paragraphs in the accord are changed and amended and six paragraphs on the John Hamm agreement that was negotiated in 2005.

If the government wants to be honest and accurate, it should say that the Province of Nova Scotia has the choice of the new formula or an amended Atlantic accord, but that it does not have access to the old Atlantic accord.

I had hoped the minister would take my advice and be accurate and say that if that is the case. When I asked that question, he pointed out that I said that the budget was good. I did say the budget was good and that it was good for my riding but it does not give anybody the right to break a contract. We all sign contracts and we all honour them. All Canadians honour contracts. The Government of Canada should honour its contracts, no matter who signs them, whether it is the Liberals, the Conservatives, the NDP or whichever party is the government at the time. I feel very strongly about that.

I will go back to this nine paragraph agreement called the Atlantic accord. It was signed and agreed to by John Hamm and the very distinguished minister of fisheries and oceans at the time, the member from Halifax. It is a simple agreement but a very meaningful one to Nova Scotia.

Newfoundland and Labrador has a similar agreement and it means the world to Newfoundland and Labrador, as it does to Nova Scotia.

The member for Edmonton—Leduc took exception to the agreement but every province has exceptions and every province has special deals. This is our special deal and we value it tremendously.

We just signed an agreement with British Columbia to give it hundreds of millions of dollars for the Pacific Gateway. Manitoba did not get a Pacific Gateway fund, neither did Ontario nor did Digby.

Nova Scotia's special deal is the Atlantic accord and we are not flexible on it. We will continue to demand the Atlantic accord. It is only nine paragraphs long but it is a work of art. I did not realize how good it was until we got into this debate and I started to study it. It is really neat. I was moved to call John Hamm, the former premier of the province, because it is magic. I sold cars for 20 years and made a lot of deals but I could not make a deal as good as this one. It is an excellent deal and John Hamm deserves the credit.

John Hamm also agrees that this budget changes the purpose, the intent and the spirit of this agreement. I have great faith in John Hamm and his comments on it. He has helped me a great deal through this as I have learned to understand how it all evolved and how it came to be.

I am again asking the government to not only honour this signed contract, but to honour every contract. When the Government of Canada signed that contract it should have been gold-plated and recognized around the world as Canada.

Business of the HouseOral Questions

June 7th, 2007 / 3 p.m.
See context

York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, today we will be continuing with the business of supply.

Tomorrow we hope to conclude third reading of Bill C-52. In answer to the question on priorities, I would point out that Bill C-52, the budget implement bill, is the number one priority of this government. We can talk about other priorities after we see an indication that it will be heading for royal assent. If we do not have it, it will result in the loss of $4.3 billion in 2006-07 year end measures which include: $1.5 billion for the Canada ecotrust for the provinces; $600 million for patient wait times guarantees; $400 million for Canada Health Infoway; $200 million for protection of endangered species; $30 million for the Great Bear rain forest; $600 million for labour market agreements for the provinces; $30 million for the Rick Hansen Foundation; $100 million in aid for Afghanistan; $100 million to Genome Canada; and so on. It is a long list of important priorities financing that will be lost if the bill is not passed by the end of this session in June. That is obviously our number one priority.

Next week will be getting things done for all of us week when we consider a number of bills that are in their final stages of the legislative process.

The following bills will be placed under Government Orders for debate: Bill C-11, An Act to amend the Canada Transportation Act and the Railway Safety Act and to make consequential amendments to other Acts, which the Senate reported with amendments and which is now back before the House to receive the approval of the members, and Bill C-23, An Act to amend the Criminal Code (criminal procedure, language of the accused, sentencing and other amendments).

We are awaiting the Senate's report with amendments on Bill C-31, An Act to amend the Canada Elections Act and the Public Service Employment Act.

Bill C-33, An Act to amend the Income Tax Act, including amendments in relation to foreign investment entities and non-resident trusts, and to provide for the bijural expression of the provisions of that Act, Bill C-42, An Act to amend the Quarantine Act and Bill C-47, An Act respecting the protection of marks related to the Olympic Games and the Paralympic Games and protection against certain misleading business associations and making a related amendment to the Trade-marks Act, will probably be passed by the House at third reading.

Discussions have taken place with the opposition parties, and there may be consent to fast-track some or all of the following bills: Bill C-59, An Act to amend the Criminal Code (unauthorized recording of a movie), Bill S-6, An Act to amend the First Nations Land Management Act and Bill C-51, An Act to give effect to the Nunavik Inuit Land Claims Agreement and to make a consequential amendment to another Act.

There is also a possibility of quick passage of a new bill entitled “An act to amend the Geneva Conventions Act, an act to incorporate the Canadian Red Cross Society and the Trademarks Act”, which appears on today's notice paper.

There are a number of other bills I am still hoping we could get included in getting things done for all of us week, provided that they get reported back from committee, in particular, Bill C-6 aeronautics; Bill C-27 dangerous offenders; Bill C-32 impaired driving; and Bill C-44, the bill to grant first nations people the human rights that every other Canadian enjoys. First nations people expect the House to get things done for them as well, so I urge the aboriginal affairs committee to stop delaying Bill C-44 and report it back to the House early next week. It is a priority for this government.

Budget Implementation Act, 2007Government Orders

June 6th, 2007 / 4:50 p.m.
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Harold Albrecht Conservative Kitchener—Conestoga, ON

Mr. Speaker, I noted with interest some of the comments that the member opposite made. I am wondering if he would comment on how the people in his province are receiving the good news that there will be this $2,000 child tax credit, saving Quebec parents almost $300 million.

Also, there is an increase in the basic spousal amount providing another almost $60 million in tax relief. Certainly, there are many initiatives here that I would think that he would be glad to support in Bill C-52.

Budget Implementation Act, 2007Government Orders

June 6th, 2007 / 4:40 p.m.
See context


Mike Wallace Conservative Burlington, ON

Mr. Speaker, it is my honour to talk today about Bill C-52. It is an important bill. Honesty was mentioned many times by the member, and I think he is treading on very dangerous ground.

I attended every one of the committee meetings dealing with income trusts, for example. Not once did the member bring forward the concept of the Liberal plan or discuss it with any of the witnesses during those sessions. I challenge him to check the blues on that. It was after they were all done.

It is completely dishonest to say that the Conservatives checked to see whether the experts we had in front of us believed in his plan. For someone who represents one area and lives in another, honesty is a really difficult thing I think.

Budget Implementation Act, 2007Government Orders

June 6th, 2007 / 4:05 p.m.
See context


Harold Albrecht Conservative Kitchener—Conestoga, ON

Mr. Speaker, I listened carefully to the remarks of the parliamentary secretary. I certainly applaud the initiatives of the budget and specifically of Bill C-52.

The tax cuts for families are very well received in my riding. The improved financial security from the measures for seniors, such as pension splitting and RRSP regulation changes, is also very important.

However, I want to refer specifically to a comment that she made in regard to the investment of $50 million for research and development to the Perimeter Institute.

I have had the privilege of visiting the Perimeter Institute and the Institute for Quantum Computing. I want to confirm that she said if Bill C-52 is not passed that $50 million could be in jeopardy, because if that is true, there are many residents of the KW area who will be very concerned. In fact, this would impact the future research capabilities of this great institution.

Budget Implementation Act, 2007Government Orders

June 6th, 2007 / 3:45 p.m.
See context

Calgary Nose Hill Alberta


Diane Ablonczy ConservativeParliamentary Secretary to the Minister of Finance

Mr. Speaker, I welcome the opportunity to introduce Bill C-52 at third reading. Once passed, the proposed legislation will implement key measures from budget 2007 along with other tax initiatives that were announced prior to the budget.

Our goal is to help Canada and Canadians unleash an extraordinary potential. We are a successful, independent nation that believes in tolerance, justice and providing a helping hand to the less fortunate.

As the world changes, Canadians need to work together to make Canada even more prosperous and strong. We have a plan, “Advantage Canada”, that will take us there, and the measures in Bill C-52 are an integral part of that plan.

To that end, Bill C-52 proposes to invest an additional $39 billion over the next seven years to help the provinces and territories deliver the quality services that Canadians have come to expect from a country as great as ours.

It is difficult to visualize just how many dollars there are in $1 billion, so I will like to put it in a different perspective. A billion dollars is a thousand million and $39 billion would be 39 thousand million.

A billion hours ago, our ancestors were living in the stone age. A stack of one billion dollar bills will reach from the ground to 120 kilometres upward. If one sat down to count a billion dollar bills, and I would like that chore, and could count them at the rate of one per second, every second of every day, it would take more than 30 years to finish counting that one billion dollars.

If you earned $1,000 a day, Mr. Speaker, and I am sure you are worth that, you would take 2,740 years to earn $1 billion. If you had $1 billion and you spent $3,000 of it every day, and I am sure some of us would be able to do that, it would take 1,000 years to spend the whole $1 billion.

When I say that our government is putting $39 billion additional new money into the hands of provinces and territories to provide good services for Canadians, that is a lot of money, 39 billion new dollars. That will provide Canadians with health care, post-secondary education, new child care spaces, a clean environment and infrastructure like roads, bridges and public transit.

In addition, Bill C-52 contains a number of tax reduction measures that will improve the standard of living for Canadians. I am talking about the working family tax plan that will make it easier for working families to get ahead and stay ahead.

This plan includes a new $2,000 child tax credit that will provide up to $310 of tax relief for each child under 18 to more than three million Canadian families. The plan also increases the spousal and other amounts to the same level as the basic personal amount. This will provide up to $209 of tax relief to two parent families with one parent who earns little income.

Single parents and family members caring for dependants will also benefit. The working family tax plan helps families saving for their children's education by eliminating the $4,000 limit on annual contributions for registered education savings plans and increasing the lifetime contribution limit to $50,000 from $42,000. It also increases the maximum annual Canada education savings grants amount to $500 from $400.

As for our pensioners and seniors, the plan increases the age limit to 71 from 69 for registered retirement savings plans and registered pensions.

Bill C-52 also proposes to enact the tax fairness plan. This plan will provide tax assistance to our seniors by increasing the amount eligible for the age credit by $1,000, putting it up to $5,066. The plan will also help our seniors by allowing couples, for the very first time, to split their pension income. This represents tax savings of over $1 billion annually for Canadian pensioners and seniors.

Going forward, the government is committed to providing additional tax relief for individuals to improve the rewards from working, saving and investing.

Canada's new government has built on its commitment to implement the 10 year plan to strengthen health care, a plan that provides $41.3 billion in new federal funding over 10 years to provinces and territories.

In budget 2007 we built on that commitment. For example, the budget proposes an investment of $400 million for Canada Health Infoway, an organization that is making significant progress in working with provinces and territories to implement electronic health records. This initiative will help reduce wait times, reduce the risk of medical errors and lead to better health outcomes.

Furthermore, Bill C-52 proposes funding of up to $612 million to support all provinces and territories as they move forward with their commitment to implement patient wait times guarantees.

As we know, in July 2006 Canada's new government approved the use of a vaccine that provides protection for young girls and women against two types of human papillomavirus, or HPV. These viruses are responsible for approximately 70% of cancers of the cervix in Canada. This is the second most common cancer in women aged 20 to 44 after breast cancer, and that is a very disturbing statistic. That is why a measure from budget 2007 contained in the bill proposes to provide $300 million in per capita funding for provinces and territories to fight HPV.

Canada's new government has a comprehensive and results oriented plan to clean our air, help address climate change and create a healthier environment for Canadians. With that goal in mind, budget 2007 proposes to invest $4.5 billion toward a cleaner, healthier environment. Bill C-52 takes an important first step in that direction by proposing to provide more than $1.5 billion to a trust fund for initiatives undertaken by provinces and territories in support of clean air and climate change projects.

In addition, building on the initiatives taken in budget 2006, our government will strengthen conservation of sensitive land and species and preservation of our cultural and natural heritage. One such measure in Bill C-52 proposes $225 million for the Nature Conservancy of Canada to conserve ecologically sensitive land in southern Canada.

The bill also proposes $30 million in funding to support an innovative model of sustainable land and resource management development in the Great Bear Rain Forest on the central coast of British Columbia.

As members know, Genome Canada is a not for profit corporation that supports Canadian research leadership in genomics, a powerful emerging field, with the potential for significant advances in health care, sustainable development and in the environment. Since its creation, Genome Canada has been very successful at strengthening the genomics research environment in Canada, not only by attracting leading scientists but putting in place the advanced technology needed for genomics work.

Bill C-52 proposes to provide Genome Canada with an additional $100 million in 2006-07 to sustain funding to support, among other things, Canada's participation in strategic international research collaborations.

Bill C-52 contains a number of other important measures, none more important perhaps as the proposal to provide additional funding to help in the reconstruction of Afghanistan.

Canadians, as we all know, have played a significant role in supporting that country's efforts to build a free, democratic and peaceful country. That is why the bill proposes to provide $200 million in additional support for reconstruction and development of Afghanistan, with initiatives that create new opportunities for women, strengthen governments, enhance security and address the challenge of combatting illegal drugs.

We can see that Bill C-52 is a comprehensive bill, encompassing a broad range of initiatives to help Canadian succeed, to enhance important social services and to support our global contribution.

That is why timely passage of the bill is important. A number of measures in the bill will be lost if the bill does not receive royal assent by August 31, which for our purposes means by the time both the House and the other House rise in June. There are immediate and grave consequences which cannot be resolved in September. The money will be gone and the Liberals need to be aware of this, as well as all Canadians.

Let me explain this. Should the budget implementation act not receive royal assent before the government's financial statements are finalized in August, it will not be possible to account for these measures in 2006-07.

If the budget is not passed until the fall or later, the money for the measures, which I will mention, would have to be booked in 2007-08 from new money and to do so would have to compete with new demands.

The money from 2006-07 would by law have to go into the 2006-07 surplus and then be applied to the debt and not to program funding. Therefore, a number of measures would not go forward if the bill is not passed in a timely fashion.

Measures that would not go forward are: $1.5 billion for a Canada trust foundation for clean air and climate change; over half a billion dollars for patient wait time guarantees trust; $0.4 billion for the Canada Health Infoway; $0.1 billion for CANARIE; $0.2 billion for the Nature Conservancy of Canada; $0.3 billion for the Great Bear Rainforest; $0.6 billion for labour market agreements; $0.3 billion for the Rick Hansen Foundation; $0.1 billion in aid to Afghanistan; $100 million to Genome Canada; and $50 million to the Perimeter Institute for Theoretical Physics.

I mention all of this because there have been some bumps in the road, and some possible future bumps in the road, in both Houses of Parliament in ensuring that this important bill, which has been before us for some time, is passed in a timely manner. I do not think Canadians want to see these important measures I have just listed lost because parliamentarians cannot work together constructively for good things for Canada and Canadians.

I end by urging all members of both this House and the other place to give Bill C-52 their support in a timely manner, so the benefits can start to flow to Canadians as they should.

Budget Implementation Act, 2007Government Orders

June 6th, 2007 / 3:45 p.m.
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Jim Prentice Conservative Calgary Centre-North, AB

Budget Implementation Act, 2007Government Orders

June 5th, 2007 / 6 p.m.
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Whitby—Oshawa Ontario


Jim Flaherty ConservativeMinister of Finance

moved that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, as amended, be concurred in at report stage with further amendments.

Budget Implementation Act, 2007Government Orders

June 5th, 2007 / 5:30 p.m.
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The Acting Speaker Conservative Andrew Scheer

The hon. member for Scarborough—Agincourt perhaps can come back to the House to request unanimous consent to table it, but we have to move on to the deferred recorded division on the motions at report stage of Bill C-52.

Call in the members.

The House resumed from June 4 consideration of Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, as reported (with amendment) from the committee, and of the motions in Group No. 1.

The BudgetOral Questions

June 5th, 2007 / 2:30 p.m.
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York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, the hon. leader of the NDP should take a moment to reflect on what he has been opposing in Bill C-52, the budget implementation bill. If we do not pass it by June 30, here are some things that would be put in jeopardy, almost $3.9 billion in spending measures that would be lost if we do not pass it by June 30, tied to the previous fiscal year: $612 million for the patient wait time guarantee trust would be lost; $1.5 billion for clean air and climate change for the provinces would be lost; $400 million for Canada Health Infoway would be lost; $225 million for the Nature Conservancy of Canada would be lost.

We do not intend to vote against those things. We do not intend to lose things. We do not intend to change those things.

Speaker's RulingBudget Implementation Act, 2007Government Orders

June 4th, 2007 / 4:40 p.m.
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The Speaker Liberal Peter Milliken

The period for questions and comments now being over, the Chair is now prepared to rule on the point of order raised by the hon. member for Markham—Unionville concerning an amendment ruled out of order during the deliberations of the Standing Committee on Finance on Bill C-52, the Budget Implementation Act, 2007.

The Chair would like to thank the member for Mississauga South and the Parliamentary Secretary to the Minister of Finance for their input, which was very useful.

As a starting point to this rather complex matter, I wish to review what happened in committee. During consideration of Bill C-52 in the Standing Committee of Finance on Wednesday, May 30, several amendments were proposed by the hon. member for Markham—Unionville dealing with SIFT or income trusts. In dealing with the amendments, the chair expressed some doubt as to their procedural admissibility but asked for guidance from the mover and the departmental official present as to what the amendments were attempting to accomplish. From the exchange that occurred, the chair concluded that Bill C-52 was creating a non- refundable dividend tax credit whereas the amendment was:

...putting in place a refundable credit that requires additional use of monies from the consolidated revenue fund, and therefore that particular amendment is not in order.

That ruling was challenged and sustained. The other amendments from the hon. member for Markham—Unionville were defeated.

Before considering the impact of Motion 2 at the report stage, which is identical to the amendment ruled out of order at the Standing Committee on Finance, the Chair would like to quickly review the basic rules that must be followed when the Crown exercises its financial initiative.

The first is that any increase in a charge to the public, that is, a new tax, an increase in an existing tax or the continuation of a tax which is to expire, would need to be preceded by the adoption of a ways and means motion. An alleviation of taxation, that is, a reduction in an existing tax, does not need to be preceded by the adoption of a ways and means motion.

The second is that any appropriation of public moneys, that is, the spending of moneys from the consolidated revenue fund, must be first recommended by the Crown before being approved by Parliament.

In this particular case, we have a unique situation. The amendment by the hon. member for Markham—Unionville appears to effect “a refund or credit against taxes otherwise payable”. Is this the alleviation of taxation or is this an authorization for a new and distinct program of spending? If it is the former, no ways and means motion is required. If it is the latter, a royal recommendation would need to accompany the amendment.

In reviewing the evidence of the Standing Committee on Finance, I am inclined to agree with the conclusion of the chair, that is, that the amendment proposes to create a new initiative, in this case, it is called a refundable tax credit, which results in the appropriation of moneys from the consolidated revenue fund for a distinct purpose.

Therefore, I would conclude that Motion No. 2 cannot be selected for report state as it requires a royal recommendation and that Motions Nos. 1, 3 and 4 ought not to be selected as they were defeated in committee.

I thank all hon. members for having raised this issue.

Resuming debate. The hon. member for Saint John.

Budget Implementation Act, 2007Government Orders

June 4th, 2007 / 3:55 p.m.
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Paul Szabo Liberal Mississauga South, ON

Mr. Speaker, I am pleased to participate in the debate on the report stage of Bill C-52.

Earlier today the Speaker ruled on the admissibility of the report stage motions proposed by members. Motion No. 2 was not chosen for debate as it requires a royal recommendation. Motions Nos. 1, 3 and 4 were also not chosen because they had been dealt with and defeated at committee.

That left us with Motions Nos. 5 through 9. Those motions actually have to do with a subject matter that only the previous speaker spoke about. We are here debating changes to the bill that have been proposed on matters which have not been dealt with at committee or which have been brought forward by the government. In this case, they in fact are brought forward by the government so I would at least like to put on the record with regard to the five report stage motions that these all relate to the visitor rebate program.

Most of them are technical amendments. They have to do with a matter that came from and was suggested by the industry. There were some questions. The committee was not able to deal with it or was not aware of the matter. What they relate to in amendments Nos. 5 through 9 is that they actually make certain deletions to some of the clauses. Members will see it in the Order Paper and Notice Paper today. As well, they make some technical corrections to references to other pieces of legislation.

The effect of those changes is that non-resident persons and unregulated non-residential tour operators may apply for a rebate of the GST and the federal component of the HST paid on the supply of a tour package that includes short term accommodation or camping accommodations that will be used by the non-resident. The amendments also ensure that the rebate also applies to the provincial component of the HST.

Having taken the time this morning to review the amendments, I believe that these amendments are appropriate and reflect the fairness and intent of the House with regard to the visitors rebate program, so I am pleased that the necessary amendments to the bill have been proposed. I will take the opportunity to look at them in more detail as soon as I can get the legislation to which they relate to ensure that the language is in order, but subject to technically checking them, I believe that the report stage amendments should be supported.

That is a pretty short speech on the report stage motions, but I would like to comment further on the point of order raised by the finance critic for the Liberal Party with regard to amendments members attempted to raise at the committee stage of Bill C-52. They had to do with changes to the bill that would reflect what the Liberal Party believes to be a preferable approach to the so-called disparity or gap between the taxation of income trusts and dividend-paying corporations.

In the point of order that was raised, it was noted that a question raised in committee was ruled out of order by the chair. Certain reasons were given. Those are now being challenged. Hopefully the Speaker will have an opportunity to look at them.

I took the opportunity to review the basis of the proposed amendments that were submitted by Liberals at committee. They had to do with a commitment that the leader of the official opposition made.

The gist of it was that in relation to the proposed tax on distributions from publicly traded income trusts or publicly traded partnerships, other than those that hold passive real estate investments, the government should repeal the 31.5% tax regime and replace it with a 10% tax to be paid by such entities, with the revenue to be shared equitably with provincial governments. That is the first part.

Interestingly enough, the point raised in the point of order and the discussion about the propriety of the punitive tax on income trusts was whether or not a change from 31.5% to 10% was a matter which would require a royal recommendation or was out of order. Clearly, I think the argument showed with reference to precedent that the amount of a tax being imposed is certainly not beyond the scope of the committee's work to change.

The second part has to do with the revenue being shared equitably with the provincial governments provided that the tax would be refunded to investors who are Canadian residents in order to, first, minimize the loss of tax savings to Canadians who invested in income trusts; second, to preserve the strengths of the income trust sector; third, to create fairness by eliminating the tax leakage caused by the income trust sector; and fourth, to create neutrality or approach neutrality by eliminating any incentive to convert from a corporation to an income trust purely for income tax reasons.

Let us look at the elements. One is the amount of the tax and whether it is 31.5% or 10%. The second item has to do with a refundable tax credit, which basically means that should the Liberal proposal be adopted, the tax would be substantially less but would be applied immediately, rather than deferred for the five year period proposed by the government. As a result of it being refundable to Canadians, the burden of that tax would be paid only by non-residents, where the majority of the so-called tax leakage occurs. Timing, of course, is always a question.

I am sure that after a review of the transcript or the proceedings of the committee, the Speaker may very well find that the decision of the chair was based on incorrect information and that indeed the amendments proposed at committee maybe should have been in order. As a consequence, other amendments may also be in order.

It will be very interesting to see how this plays out, because clearly the idea is that we want to make sure we get it right. That is why we have a rigorous legislative process. That is why committee does its work. When the chair has to rule a matter out of order, we would hope that the understanding and the determination of fact brings a good decision. In this case, I am sure that it warrants review.

Finally, while most members seek to talk about the budget in general, I can tell members that with regard to the broken promise of the government on income trusts, the Prime Minister said that the greatest fraud “is a promise not kept”. He also said that he would never tax income trusts, but on October 31 of last year he turned around and did exactly that.

The consequences were that over two million Canadians lost about $25 billion of their hard-earned retirement nest eggs. That is very harmful. In fact, I have been told by some that four to five million Canadians have been directly or indirectly adversely affected by that broken promise.

Also, there were other consequences. We have been talking about tax leakage. Members well know that so far, because of the depressed value of income trusts, the taxes to be paid by these corporations are actually going to be less because of the significant takeovers. I believe there have been at least a dozen takeovers of these energy trusts, which means that their structures have been set up so that they are not going to pay any taxes.

The consequences of imposing that tax are far worse than the government ever dreamed.

The House resumed consideration of Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, as reported (with amendment) from the committee, and of the motions in Group No. 1.

Motions in AmendmentBudget Implementation Act, 2007Government Orders

June 4th, 2007 / 12:25 p.m.
See context

Calgary Nose Hill Alberta


Diane Ablonczy ConservativeParliamentary Secretary to the Minister of Finance

Mr. Speaker, I see everyone is very happy that I am getting up on debate and I too am very pleased to rise today to speak to Bill C-52 at report stage. It has been a long road but here we are at report stage.

The bill proposes to implement certain measures from budget 2007 along with other tax initiatives along with other tax initiatives that were announced prior to the budget.

I would like to start today by giving a quick tour of the key themes and messages of budget 2007. I will then outline the key measures in Bill C-52 and illustrate how they fit into the big picture.

Today, Canada is strong. Canada's new government has a plan to make it even better for tomorrow. The measures in budget 2007 will help up achieve that goal. It will do so by delivering on the commitments made in “Advantage Canada”, the government's long term economic plan for Canada.

It takes historic action to restore fiscal balance with the provinces and territories by investing an additional $39 billion over the next seven years. These important investments are made in things that matter to Canadians: a modern health care system, a strengthened post-secondary education system, new child care spaces, a clean environment, an approach to labour market training that is more responsive to the needs of Canadians, and infrastructure like roads, bridges and public transit.

Budget 2007 builds on action from budget 2006 by further reducing the tax burden in Canada to make it easier for working families to get ahead and stay ahead through initiatives such as the tax back guarantee and our working families tax plan.

This year's budget cracks down on corporate tax avoiders to restore fairness to Canada's tax system. It invests in the social priorities that have come to define Canada as one of the truly great and caring nations of the world. In short, budget 2007 is an ambitious catalyst for action that builds upon the tremendous progress we made in our government's first budget.

This budget is about making our strong economy even stronger. We know that by creating a climate of hope and opportunity, and providing the necessary tools so Canadians from all walks of life can reach their full potential, Canada can be an example to the rest of the world, an example of a truly great and prosperous nation, an example of a compassionate and benevolent nation.

Canada's new government aspires to a stronger, safer and better Canada. Budget 2007 is a path to those ends.

Bill C-52 gives effect to the policies and programs that will get us there. A key element of budget 2007 is the restoration of fiscal balance with the provinces and territories and Canadian taxpayers.

Bill C-52 proposes to legislate key budget measures on fiscal balance, delivering on the specific commitments made in budget 2006 regarding fiscal balance and going even further. Through these measures fiscal balance is restored in a principled way, in a national context, and by respecting existing agreements and commitments.

To begin, the fiscal balance is being restored with the provinces and territories by putting transfers on a long term principles-based footing.

Bill C-52 proposes to legislate renewed and strengthened equalization and territorial formula financing programs that will provide more money over the next two years to eligible provinces and the three territories.

It also proposes to renew and strengthen the Canada social transfer making it fair by providing the same support to all Canadians regardless of where they reside and by making significant new investments in support of post-secondary education and children.

The budget also takes another step toward restoring fiscal balance with Canadian taxpayers through major tax reductions and the tax back guarantee. I will come back to the tax reduction point in a moment.

Moreover, we are making governments more accountable to Canadians by clarifying roles and responsibilities, and we have strengthened the economic union based on the plans set out in “Advantage Canada”.

Canada's new government has said all along that Canadians pay too much tax. We have not just talked about doing something about it, we have done something about it in our very first budget last year and again this year in budget 2007.

Since coming to office, Canada's new government has taken action that provides almost $38 billion in tax relief for individual Canadians. Over this year and the next two years, there will be $38 billion in additional tax relief. This kind of action illustrates our commitment to deliver on our promise to reduce taxes for Canadians.

Budget 2007 not only takes historic action to restore fiscal balance in Canada, but provides significant tax relief for individuals, with a focus on supporting working families with children. For example, budget 2007, through Bill C-52, would introduce the working income tax benefit and the working families tax plan. The working income tax benefit would build on the recent progress made in lowering the so-called welfare wall, notably for families with children, through the federal, provincial, territorial national child benefit initiative.

For some Canadians, the working income tax benefit could represent the difference between being better off and worse off as a result of taking a job. For example, a single parent who takes a job, before the bill is passed, can lose almost 80¢ of each dollar earned to taxes and reduced income support, and that is not accounting for additional work related expenses or the loss of in kind benefits.

The working income tax benefit would reward work and strengthen incentives to work for more than $1.2 million low income Canadians by providing up to $1,000 for families and $500 for individuals. To help Canadian families get ahead, the working families tax plan would also introduce a new $2,000 per child tax credit for children under 18. The new child tax credit would benefit about three million taxpayers. What is more, it would take up to 180,000 low income Canadians off the tax rolls and would provide more than 90% of taxpaying families with the maximum benefit of $310 per child.

We also propose to increase the spousal amount to the same level as the basic personal amount. We also, in the bill, enact the tax fairness plan, which delivers over $1 billion in additional tax savings annually for Canadian pensioners and seniors, including income splitting.

We also, as I mentioned earlier, in this bill have the tax back guarantee. This means that the government guarantees that it will use the interest savings from national debt repayments to reduce personal income taxes.

We also have invested in the health care system, the 10 year plan to strengthen health care, which provides $41.3 billion over 10 years to provinces and territories. In this budget we built on that commitment with Canada Health Infoway and with other measures. We also have invested in a cleaner, healthier and safer environment.

I urge the House to support the bill and the measures in it, which would take our country forward in a better and stronger way, and will be helpful for all Canadians, whatever their situation.

Speaker's RulingBudget Implementation Act, 2007Government Orders

June 4th, 2007 / noon
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The Acting Speaker Conservative Royal Galipeau

I have a ruling by the Speaker concerning Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007. There are nine motions in amendment standing on the order paper for the report stage of Bill C-52.

Motion No. 2 will not be selected by the Chair, because it requires a royal recommendation.

Motions Nos. 1, 3 and 4 will not be selected by the Chair, because they were defeated in committee.

All remaining motions have been examined by the Chair and the Chair is satisfied that they meet the guidelines expressed in the note to Standing Order 76.1(5) regarding the selection of motions in amendment at the report stage.

Motions Nos. 5 to 9 will be grouped for debate and voted upon according to the voting pattern available at the table.

I will now put Motions Nos. 5 to 9 to the House.

(The House resumed at 12 p.m.)

The House proceeded to the consideration of Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, as reported (with amendment) from the committee.

Business of the HouseOral Questions

May 31st, 2007 / 3:05 p.m.
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York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, with regard to the last point, we have already addressed that.

However, with regard to the balance of Thursday's statement, I am pleased to respond that today and tomorrow we will continue with Bill C-55, the expanded voting opportunities bill; Bill C-14, the adoption bill; Bill C-57, An Act to amend the Immigration and Refugee Protection Act; and Bill C-45, the fisheries act.

In the last Thursday statement, we indicated that we were hoping to have this week as “enhancing the quality of the life of first nations people week” but this was cancelled by the opposition parties when they did not release Bill C-44 from committee, the bill that would give the first nations protection under the Canadian Human Rights Act. Not only is it being held up now but, as early as this morning in this House, the opposition obstructed our efforts to get the bill dealt with forthwith so that first nations people could have the human rights that every other Canadian enjoys. We know that if all parties would agree to proceed with that, as we saw when we sought unanimous consent, it could proceed, but some would prefer to obstruct it.

Next week will be welcome back from committee week, when we welcome business that has been at committee, including some that has been stalled there for some time. We will deal with Bill C-52, the budget implementation bill, which will begin report stage on Monday and, hopefully, we can get third reading wrapped up by Tuesday.

Following the budget bill, we will call for report stage and third reading of Bill C-35, bail reform. After that, we will call Bill C-23, the Criminal Code amendments. I hardly remember when Bill C-23 was sent to the committee by this House. That took place long before I was even House leader 228 days ago.

Thursday, June 7, shall be the last allotted day. There are a number of other bills that we would like to include in our welcome back from committee week. I still hope we can see Bill C-44, the amendments to the Canadian Human Rights Act, to which I just referred; Bill C-6, the amendments to the Aeronautics Act; Bill C-27 dealing with dangerous offenders; Bill C-32 dealing with impaired driving; and Bill C-33 dealing with foreign investment, if the opposition parties will release those from committee.

FinanceCommittees of the HouseRoutine Proceedings

May 31st, 2007 / 10:05 a.m.
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Paul Crête Bloc Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC

Mr. Speaker, I have the honour to present, in both official languages, the 20th report of the Standing Committee on Finance on Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, as agreed on Wednesday, May 30, 2007.

May 30th, 2007 / 3:50 p.m.
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The Chair Conservative Brian Pallister

I call the meeting to order pursuant to the order of reference of Tuesday, May 15, 2007, Bill C-52, an act to implement certain provisions of the budget tabled in Parliament on March 19, 2007.

I assume all committee members have their packages of amendments.

I thank our Finance officials for being here. I see some familiar faces and welcome you back.

I understand we have a number of amendments to deal with. We'll start by postponing dealing with clause 1 until later. I'll ask for the committee's ongoing cooperation, in the best interests of all of us and our guests today, to deal with these in as reasonably prompt a manner as we possibly can.

Mr. McCallum.

May 29th, 2007 / 12:55 p.m.
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Armine Yalnizyan Director of Research, Community Social Planning Council of Toronto , As an Individual

Thank you, Mr. Chair.

Yes, context is everything, so I want to talk about my context. I come from the Social Planning Council of Toronto. It serves the residents of the sixth biggest governmental jurisdiction in the country: 2.5 million people. We deal with about 1,400 agencies that provide human services to residents, that cover hundreds of thousands of residents every day, and that touch literally the lives of all citizens in Toronto.

We're funded by the City of Toronto and the United Way, if you're wondering where our money comes from.

Context is everything for you. You folks are dealing with the daily cut and thrust of politics. The two big contextual issues in which you discuss Bill C-52 are these.

In the last few days there is the remarkable development in Quebec, where a minority government might fall because it's promising to deliver on its promise to cut taxes, because members of Quebec society feel the need for that money to be used to provide health and education is perhaps the more important imperative. That's quite a remarkable development in our political discourse of the last few years.

The second very important political moment for you is this discussion of mergers and acquisitions and foreign takeovers, which is not just an issue of foreign ownership but more an issue of increasing concentration of our corporate resources. This is a theme I'll touch on in a moment.

Our context for discussing Bill C-52 has several features. First of all, the economy is hotter than it's been in 40 years. All the fundamentals are right. Our government at the federal level has run 10 back-to-back fiscal surpluses, a feat that has not been paralleled by any other nation on the surface of the planet. We are literally rolling in money. That's quite a remarkable contextual moment.

Secondly, we are facing the biggest retirement of the labour force of any industrialized nation on the planet. No other nation had as big a baby boom as Canada had. We have been sleepwalking towards this event with no national training strategy. Whereas our governments mandate access to health and education, there is no national strategy to deal with what is about to hit those services, which are considered basic by every Canadian who lives here.

Thirdly, inequality is a growing issue globally: between nations, within nations, within your ridings. There's not one of you who sits here who doesn't know of stories of how inequality—not just growing poverty, but growing prosperity—happens cheek by jowl in your riding, rural or urban, and what the impact of that is on your constituencies and between households.

I would love the opportunity to address any one of your caucuses about the issue of inequality as the other inconvenient truth of our era: that it is unsustainable in Canada. It is growing at a faster rate than it has in the 30 years we have data for it, at a time when precisely economic conditions are ripe for its reversal. And it is happening with a face, a place, and a race—some of those comments that Mr. Jock has referred to. This is completely unacceptable for a country with our prosperity.

We have just returned to the rate of child poverty that unanimously your colleagues in 1989 stood up in Parliament and said was unacceptable. Child poverty had to be eliminated when it was at the 11.7% mark in 1989, and now we should be cheering that it has returned to that after 10 years of economic prosperity.

I would say to you this is not about just poverty, and it's also not about just income, when the rich set the markets for housing, and when we are dealing with a global diaspora because we're not dealing with training but are importing our solution. We're welcoming people into the three major immigrant basements, plus Calgary and Edmonton, where there are housing shortages already, where the rich set the prices for housing markets, where our bankers and our economists tell us that over the course of the next 20 years housing prices are going to double. There's not one economist or banker who will tell you that incomes are going to double.

This is not a poverty issue, though poverty is the worst part of it. We are sitting on a potentially huge problem, when the majority of Canadians are feeling increasingly economically insecure at a time of huge prosperity.

I won't go into the other parts I wanted to touch on. But I want to say that I think you have three revenue-neutral options for adjusting your budget to address some of these realities.

First, you should reconsider the tax cuts promised last year. The second 1% of GST reduction—that one point of GST reduction—should go to where the real fiscal imbalance now lies.

You've done an amazing job of starting the discussion on where the fiscal imbalances are and how to redress them. I think it's very important for you to recognize that the real vertical fiscal imbalance is with the cities: $60 billion to $120 billion of infrastructure deficit that we know of, which is hard infrastructure deficit, primarily occurs in the cities, and they have no capacity to raise the funds for this. The federal government should be playing a role there.

Secondly, you have introduced significant changes to the CST. We are repeating exactly what we did with the CHST and the separation of the CHT, and so on. It's time to separate out those elements of the CST and introduce clear objectives as to what these pots of money are for. This government is the value-for-money government. It's the accountability government. Show us where the money is going and what we're getting for it.

I think we have some precedents in the way we got the four pillars of child care negotiated prior to that. We can separate out the CST so we are clear on what we are sending money to the provinces to achieve, and it surely can't be just to produce tax cuts for their citizens.

Thirdly—can I just make one more point?

May 29th, 2007 / 12:45 p.m.
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Dianne Urquhart Independent Consulting Analyst, As an Individual

Good afternoon.

There is no need to alter the income trust tax amendment in Bill C-52 based on any developments that have occurred since October 31, 2006, when the new income trust tax was announced. The only action that's now required is for the Canada Revenue Agency to make an announcement that it plans to use the general anti-avoidance rule and the thin capitalization rules in the current Income Tax Act to ensure that all acquirers of income trusts will be forced to pay Canadian business taxes. This must done so that individual investors are treated fairly compared to pension funds, private equity funds, corporations, and U.S. master limited partnerships. I'll speak on that in a moment. I want to review some of the developments since I was last here.

First of all, the income trust tax damage was relatively small upon announcement. The average capital loss in the 14 days post-announcement was 14%, or $24 billion. The capital loss as of last night is now negative 3%, or $5 billion. While income trusts have rallied from their worst prices, they have, as indicated earlier this morning, underperformed the common stock market, which rallied 15% since October 31.

Income trusts are underperforming corporations in the market because they're bringing out the overvaluation that was contained in the market prior to the announcement of the tax. Without access to the new financings, distributions have become less sustainable. The Ponzi structure of paying the excess distribution is not working anymore. Income trusts are now brought to a level playing field with corporations. That was the objective of the tax and that is what the impact is in the marketplace.

Another development since I was last here is that on April 26, 2007, the National Pensioners and Senior Citizens Federation, the United Senior Citizens of Ontario, and the Small Investor Protection Association made a joint call for a criminal investigation by the Royal Canadian Mounted Police and the Ontario Provincial Police on the deceptive cash yields in the marketing materials used by the investment banks to sell income trusts to seniors. I'm here also as a spokesperson today on behalf of those three associations that supported the income trust tax. We have one million senior members throughout all the provinces of Canada.

While there has been some recovery of income trusts in the market as a result of extremely buoyant stock market conditions, there are still 50 business income trusts that are down more than 20% from their public offering prices in the last six and a half years. This group has had an average loss of 50%, representing $8 billion of capital losses for seniors and other retail investors.

The income trust tax was not responsible for the cause of this decline. It was due to the deceptive cash yields that proved not to be sustainable. We now have close to one-third of the business income trust market that has suspended its distributions or has made significant cuts. The latest ones—XS Cargo, Drive Products, Precision Drilling, Primary Energy Recycling—slashed distributions in the past couple of months. It's when these distributions get suspended and slashed that we get the catastrophic losses for seniors that are the subject of the call for the criminal investigation.

Now I'd like to turn back to taxes. There have been 25 acquisitions of business income trusts. Most of those have indeed occurred since October 31, but acquisitions were clearly anticipated since the new income trust tax would result in the phase-out of most income trusts by 2011. There are only two ways to phase out income trusts: you either get acquired or you decide to convert back to corporations.

The Canadian Association of Income Trust Investors, the federal Liberal Party, and several tax lawyers and financial analysts are saying that the acquired income trusts will not be paying Canada any taxes. This clearly cannot be the case. U.S. master limited partnerships are said to be the most promising acquirers of the Canadian energy trusts, with the intent again not to pay any Canadian taxes.

The objective of the vocal income trusters is to have us rescind the income trust tax that is before this committee today. This is not the answer for fair treatment of individual investors who've just had a tax advantage removed. We can't turn around and give that tax advantage to foreigners and to pension funds. The answer is fair treatment—for Revenue Canada to announce that it will enforce the general anti-avoidance rule in section 245 of the Income Tax Act and the thin capitalization rule in subsection 18(4) of the Income Tax Act.

The fair tax policy is that Canadian business is not to be permitted to operate with artificially high debt loads and interest rates for the purpose of stripping profits and paying no business taxes. Similarly, the energy trusts cannot be permitted to use artificially structured royalty agreements for the purpose of stripping profits and paying no business taxes. All Canadian businesses must pay business taxes, regardless of who owns them: public investors, pension funds, or any foreigners in the market.

May 29th, 2007 / 12:40 p.m.
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Richard Jock Chief Executive Officer, Assembly of First Nations

Thank you.

It's the submission of the Assembly of First Nations that the Government of Canada has missed an important opportunity with this budget. We feel that, to a large extent, our efforts to see the concerns of first nations addressed and to implement a first nations plan for creating opportunity remain unanswered.

It is further our point of view that without a comprehensive plan to tackle the comprehensive issues facing first nations, this leaves first nations governments and first nations peoples managing desperate situations. Therefore, we urge the committee to recommend significant amendments to Bill C-52 to reflect these urgent concerns, and we summarize our recommendations as follows.

Funding growth must be commensurate with other jurisdictions. By our estimation, this is 6.6% through equalization and CHT and CST payments to provinces, and it ranges up to 10% for the territories.

Secondly, any new legislation must recognize its financial impact on communities and be funded sustainably with reference to inflation and population growth, as well as other pertinent cost drivers.

Thirdly, discriminatory funding practices must end, and specifically I refer to the fact that within the Department of Indian Affairs' budget the provinces are paid at the provincial rates for such things as tuition agreements in the area of education, and similarly, in child and family services, which leaves comparatively less money within those same budgets for first nations to run their own services. This, in our view, is highly discriminatory.

A second example of such discriminatory practice is in terms of pension and benefit plans for band council employees. We feel that those must meet the standards of other jurisdictions and be transferrable and comparable if we're to retain and recruit capable staff. For example, many such plans are done as sort of wraparound plans, which take into consideration such things as non-insured health benefits, which then simply drive up government costs in other areas.

The fourth point is that the federal government must create a real planning basis for funding, and to do so we feel it's extremely important that with first nations there be the establishment of performance standards, which includes funding to meet those standards.

We also feel that an important part of this, again with first nations, is to look at structural changes to the machinery of government to address some of the inherent conflicts of interest that currently exist and to bring then much more independence and fairness into the fiscal relationships. This was also referred to in the RCAP report, where it talks about setting up a department that would be in charge of policy interests and a separate department that would be in charge of service delivery.

We are pleased to see that this government is renewing and expanding programs in two areas where first nations are leading the way in creating solutions for themselves and their future. Those are the aboriginal justice strategy and the aboriginal skills and employment partnership initiatives. However, these two programs and an investment in the maritime fisheries, much as those are very much needed, are not really an overall comprehensive plan.

The total investment in Bill C-52 for the next two fiscal years, then, is just under $60 million, for an average of $30 million a year.

Also in the budget we've seen reference to $300 million for market-based housing, which does deal with part of the continuum of need for housing. However, it should be noted that this was part of last year's budget announcement, and we feel that further investments in terms of social housing and other elements of that housing continuum are also necessary.

I refer you to the PowerPoint presentation that was distributed to you before the meeting, which summarizes the Canada cost drivers study, which was completed by the Department of Indian Affairs last year.

We feel the study was prompted by some of our own research in the area. I would say that to a large degree our view is that the study is based on correct figures, but our analysis is that it potentially understates some of the real circumstances.

In terms of overall approach, though, it's important to state that beyond those critical investments, we do feel it's important to address some of those historic gaps in well-being, to invest in those, but also at the same time to seek structural change. We've put forward a comprehensive plan to do that, which we'd be happy to discuss with you.

May 29th, 2007 / noon
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Prof. Paul Hobson

That's exactly the kind of analysis that I've been undertaking for Nova Scotia, that my colleague, Dr. Locke, at Memorial has been undertaking for Newfoundland and Labrador. Rumours are just rumours, so I don't want to comment on them. I doubt very much that the option will be that a province can move back and forth between a fixed framework and the new arrangements. I don't think that is in the cards in the long term.

What I would suggest, however, is that given that the decisions that have to be made for 2007-08 are in fact straightforward decisions, given the numbers that have been presented to provinces, the issues going forward should perhaps be better studied prior to being locked into budget legislation. So what I would suggest would be the implementation of a task force picking up on the work of the expert panel but now extending to the proposals that are contained in Bill C-52 that would provide greater insight into the actual effects of these proposals. They are not well understood by those of us in the academic community, as far as I can tell, nor are they understood very well by others in the policy community.

May 29th, 2007 / 11:50 a.m.
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Judy Wasylycia-Leis NDP Winnipeg North, MB

Thank you, Mr. Chair.

Let me just pick up on the last point, because in fact I don't see any sign that the Conservatives are going to voluntarily move to delete this section of the bill. Is there a way we can fix up the proposal in Bill C-52? I'm wondering if it would help to add the words—somehow get the sense across that we want to only give the incentive when we're talking about domestically produced cars. Would that be of merit, at least in terms of domestic production and jobs and industry in this country?

May 29th, 2007 / 11:25 a.m.
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John McKay Liberal Scarborough—Guildwood, ON

It's hard to imagine how one document, Bill C-52, could offend more people. Literally, a mari usque ad mare usque ad mare, from sea to sea to sea, to the industrial heartland of the nation out to Alberta, where, if you will, it's part of our new economy.

But I wanted to focus on Mr. Dielwart in my brief time. We had a presentation here yesterday and the presenter talked about the unintended negative consequences of this move with respect to the income trust fiasco. I don't generally go to paranoia, but I'm just wondering whether it was unintended or if this was a move intended to destroy the sector, because some of the consequences of the decision were blindingly obvious.

It would be blindingly obvious that this would give a boost to the growth of MLPs in the U.S. It would be blindingly obvious with experience in hand that it had potential to destroy billions of dollars worth of investment. It was blindingly obvious that it would tilt the playing field in favour of private equity, etc., and we see that rolling out literally in waves.

I know your group was talking to the previous government about energy trusts as a unique entity needing to be left alone, if you will, and it would be blindingly obvious that there are going to be a bunch of takeovers.

So I disagree with yesterday's presenter that it is unintended; these consequences were readily predictable and possibly even intended. So I want you, Mr. Dielwart, to tell this committee what's unique about energy trusts that they need a carve-out.

May 29th, 2007 / 11:20 a.m.
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Professor Paul Hobson Department of Economics, Acadia University, As an Individual

Thank you, Mr. Chair.

Let met briefly introduce myself. I've been a professor of economics for 29 years. For 25 of those years, I have studied equalization and associated aspects of federal-provincial fiscal relations. I have been working on this particular file ever since the budget came down. I've done some very detailed analysis of what is being proposed here. I'm still revising my results as I better understand what is proposed in Bill C-52.

My presentation today will focus solely on fiscal equalization payments to the provinces and associated changes to the offshore accords. The bill also makes important changes to the determination of territorial formula financing payments, as well as to the growth and distribution of the Canada social transfer and the eventual distribution of the Canada health transfer. These matters would require a separate presentation.

The bulk of Bill C-52 lays out, in terms of the text, the terms of the new equalization program applicable to the provinces. Associated changes to the Federal-Provincial Fiscal Arrangements Act are in clause 64, pages 64 to 83. In addition, clauses 80 to 86, pages 93 to 103, lay out the associated changes to the Canada-Newfoundland Atlantic Accord Implementation Act and the Nova Scotia and Newfoundland and Labrador Additional Fiscal Equalization Offset Payments Act. My point is, getting your head around all this is a huge undertaking.

Proposed section 3.1—this is in clause 80--specifies amounts for fiscal equalization payments to the provinces for 2007-08. What people need to understand is that these amounts are derived from application of the formula described in the subsequent proposed section 3.2. There are, in fact, three formulae at work in generating those numbers. One involves the O'Brien formula coming out of the expert panel. One involves a variant on that formula, with zero inclusion of natural resource revenues, and the third involves effectively a continuation of the status quo on option to Newfoundland and Labrador and to Nova Scotia.

If you go into the details of these—that's where the numbers come from—in particular how these numbers will be generated in future years, that's proposed section 3.2. Paragraph 3.2(1)(a) is the O'Brien formula. Paragraph 3.2(1)(b) is the zero inclusion of natural resources formula. And that is only part of what is being undertaken.

Proposed section 3.3 makes important transitional provisions for British Columbia with regard to the calculation of revenues derived from property taxes. There has been very little study of what the implications of those provisions are.

Proposed section 3.4 introduces the new cap on equalization, the so-called fiscal capacity cap, designed to ensure that equalization payments do not raise a province's total fiscal capacity above that of any non-receiving province. Where that does occur, equalization will be reduced. Indeed, it can be eliminated as a result of exceeding the cap.

Proposed section 3.5 provides definitions of terms and bases. There is a lot of important material in there that people are still getting their heads around. It explains the process, the three-year moving average lag of two years that will generate the data on equalization, but also the changes in how bases are being measured for purposes of determining equalization. Very little study has been made of that aspect either.

Proposed section 3.6 is very important. It makes special provision for Nova Scotia and for Newfoundland and Labrador, allowing them the option of continuing under the fixed framework indefinitely and, indeed, specifying an annual 3.5% growth rate in the aggregate equalization pot. Either province can, at its option at any time in the future, including during this year if it wishes, opt into the new program. That is specified in proposed section 3.7.

Beyond 2007-08, Nova Scotia and Newfoundland and Labrador will have to make choices. For 2007-08, the choices are obvious, and what choices are made in this particular year are not irrevocable. However, they will be irrevocable in subsequent years if either province opts into the new program. I would simply make the point that the analysis I've been involved in would suggest, from Nova Scotia's point of view, that remaining within the fixed framework indefinitely into the future would likely be its most preferred option, notwithstanding the fact that it might involve taking slightly reduced benefits in the 2008-09 fiscal year.

May 29th, 2007 / 11 a.m.
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The Chair Conservative Brian Pallister

Pursuant to the order of reference of Tuesday, May 15, 2007, we are studying Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007.

Good morning to our witnesses. Thank you for being here this morning as we continue our discussions on the budget bill, Bill C-52.

You've been asked to keep your presentations to five minutes to allow time for questions from committee members.

We will commence with the Coalition of Canadian Energy Trusts. John Dielwart is here.

Five minutes to you, John.

May 28th, 2007 / 5:05 p.m.
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The Chair Conservative Brian Pallister

Mr. Del Mastro, you have about 45 seconds left, so keep it to Bill C-52, if you can.

May 28th, 2007 / 5 p.m.
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Economist, Canadian Labour Congress

Erin Weir

Yes, of course.

I recognize that this committee has relatively little ability to change amounts of money in the budget, and I recognize that the Bloc is committed to supporting this particular budget. And I suppose that's why I've tried to focus my presentation on issues that can be dealt with by this committee and that can be dealt with after the budget. The first thing is to get this tax-back guarantee out of Bill C-52. That aspect of the bill really purports to tie the hands of future Parliaments and really reduces the ability of elected representatives to make decisions about how to allocate resources in the future. So that's one concrete thing I would ask for--some amendments in that area.

The other concrete thing is--

May 28th, 2007 / 4:40 p.m.
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George Kesteven President, Canadian Association of Income Funds

Good afternoon.

Thank you very much, Mr. Chairman and members of this committee, for giving me this opportunity to speak to you today on behalf of the Canadian Association of Income Funds.

The Minister of Finance's stated intention last October 31, with the introduction of the so-called tax fairness plan, was to level the playing field, stop future conversions to income trusts, and stop tax leakage, no matter how small. What the government has done does not amount to tax fairness, but rather the wholesale destruction of a valuable structure in the Canadian economy.

To date, the unintended negative consequences of this move have been the following:

First, to give a boost to the U.S. growth of master limited partnerships, MLPs--the U.S. equivalent of Canadian income trusts--by eliminating any competition.

Second, to destroy billions of dollars of investor value. Many of these investors invested based on a promise made and subsequently broken by Prime Minister Harper.

Third, to tilt the playing field in favour of private equity, foreign equity, and pension funds, none of which pay taxes to governments, federal or provincial.

Fourth, to make it difficult for Canadian trusts, especially resource trusts, to access capital. This makes them prime targets for takeover.

Fifth, to facilitate the takeover of close to 15 trusts in the last six months, with more than 20 announcing that they are currently on the block at fire sale prices.

Mr. Chairman, as Premier Calvert said earlier today, it is not tax fairness to break a promise made to millions of Canadian investors. It is also not tax fairness to impose a 31.5% tax when corporations effectively pay only 5% to 10%.

The playing field has not been levelled when the income trust sector has been severely disadvantaged, compared to the situation of corporations, by the elimination of non-resident investors and through the double-taxing of pension funds and RRSP holders. It is not tax fairness when Canadian investors have been disadvantaged and cut off from an investment vehicle that provides them with cashflow needed for retirement.

As far as the issue of tax leakage is concerned, it is our contention that federal and provincial tax revenues will not be increased in any way under this bill. Many governments will actually experience reduced revenues in the end.

Permit me to highlight for you the federal government's own documents of October 31, in which it forecasted zero tax revenue through 2011 from this tax. Copies of this have been provided to the clerk. It makes all the more curious the fact that the finance department has promised a new joint committee with the provinces to share in the revenue stream when none is expected over the four-year transition, and little if any is expected into the new regime as the sector is bought out or converts to corporate status.

With respect to Bill C-52 itself, we urge this committee to address clear gaps in the current drafting:

First, how will income trust be treated in legislative terms during the transition period? Currently these rules appear only in guidelines that are, in essence, a news release that can be changed at the whim of the government.

Second, there needs to be a legislative framework in Bill C-52 to facilitate conversion to corporate status on a tax-deferred basis, similar to the existing subsection 85(1) of the Income Tax Act, as well as the ability to eliminate the remaining trust vehicle in a tax-efficient manner.

We respectfully submit that the finance committee follow its own advice to the government of earlier this year in its report on income trusts by producing a separate piece of legislation that is comprehensive and that includes the guidelines and conversion rules, and is not so broad as to have application to partnerships that are not listed on the public exchange. Only then would all parliamentarians and Canadians have a clear opportunity to see this issue on its own merits, and properly address the income trust issues in this bill.

We continue to be committed to working consultatively and collaboratively with all levels of government to achieve a tax system that is fair for all.

Thank you.

May 28th, 2007 / 4:35 p.m.
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Chris Conway Manager, Government Relations, Real Property Association of Canada

Thank you, Mr. Chair.

My name is Chris Conway. I am the director of government relations for REALpac, the Real Property Association of Canada.

We represent most of the TSX-listed real estate companies, including real estate investment trusts, otherwise known as REITs.

Our members own approximately $150 billion in real estate across Canada, and we see ourselves as both the property market's lobby group and the capital markets group from real estate.

We also have several different vehicle types in our membership: real estate corporations, pension funds, life companies, banks, and large private owners.

Today I'll be speaking exclusively about REITs and the changes to the REIT rules contained in Bill C-52. I would like in particular to comment on the written technical submission we have sent to the committee for consideration.

By way of background, REITs have been specifically enabled in Canada since 1994 and have existed in the U.S. since 1960. REITs are becoming a global phenomenon, as many Asian and European countries now have REITs. Throughout the world, REITs are a very common and growing phenomenon for investors. This is because they allow small investors to access passive rental income from big-ticket real estate assets.

We continue to be grateful for the existence of the REIT exemption and the work the government and the Department of Finance have done to address initial Canadian REIT industry concerns arising out of the October 31 announcement and the draft language released in December 2006. Most of these issues were addressed in the budget motion prior to the introduction of the bill.

Our purpose in suggesting further minor items is to make sure the technical language contained therein allows the majority of existing Canadian REITs to continue operating and competing in the Canadian marketplace without regulatory uncertainty or accidental restrictions. As it is, the wording creates several operational problems. Wording changes are suggested to enable the budget bill language to better achieve what we believe to have been intended all along.

In preparing this submission, REALpac undertook significant consultations on behalf of Canada's REITs. We've reviewed many of the national law firms' and national accounting firms' public analyses of the REIT legislation. We've convened a meeting of REALpac REIT members and several of their advisers to analyze the technical language. We have drafted and circulated many successive drafts of possible changes to selected tax lawyers and tax accountants in national firms.

The result has been our written submission to the committee and suggested wording changes to the bill. Our intention is to seek these changes on a consensual basis prior to the bill's becoming law. We would be pleased to work with all stakeholders on these changes.

In addition to our technical concerns, there are two policy issues raised in our submission. The first is the foreign property ownership limits. The second is the lack of inclusion of hotels and nursing homes in the new REIT rules.

Regarding the foreign property rules, there is no solid policy rationale we're aware of for preventing Canadian REITs from owning more foreign property. All major industrialized countries allow unlimited ownership of foreign property. It appears that this is because allowing REITs to own foreign property brings in more tax revenue. The more a REIT can earn by holding properties abroad, the more it pays out in distributions to unitholders, which in turn are taxable, either domestically or through withholding tax for foreigners.

Hotels and nursing home REITs would not qualify under the new rules. We would like to point out that the U.S. REIT rules, now and for some time, have accommodated hotels and lodging REITs, and under the February, 2007 draft bills, health care and seniors' home REITs are now being included.

We have advocated two potential solutions. The first is either a slight relaxation of the REIT rules to permit hotel and nursing homes to qualify, or a fully taxable subsidiary model, such as exists in the United States. It now appears that Australia is also moving in a similar direction to allow these types of REITs.

REITs allow small investors to participate in large investment-grade real estate by purchasing REIT units. If hotel and nursing home REITs are not allowed to exist, not only are we less competitive with other jurisdictions, but we will remove the small investor from the picture.

Ultimately, it's important to have cross-border synergy in our capital markets. We do not want other countries' REITs being stronger than our own.

In conclusion, REITs allow a greater amount of capital and institutional investment to flow into real estate. We have a strong and stable capitalized public real estate market now with real estate investment trusts. There is a lot of money flowing into hotels, nursing homes, new office buildings, new industrial parks, and new multi-family developments. Making the changes we have requested will help ensure that Canadian REITs remain strong and competitive.

Thank you.

May 28th, 2007 / 3:40 p.m.
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Erin Weir Economist, Canadian Labour Congress

Thank you very much.

The aspect of Bill C-52 that I'd like to speak to today is the tax-back guarantee proposed in budget 2007. The view I'd like to present is that, at best, this measure is a gimmick, and at worst, it places an inappropriate constraint on future federal budgets.

One could start from the premise that the federal government would have reduced income taxes by a given amount in any case, in which case it's really meaningless to say that the income tax reductions are being funded by interest savings from debt repayment rather than from general revenues. If a dollar of interest savings is used to finance tax cuts, that simply frees up a dollar of general revenues for something else. Conversely, if a dollar of general revenues were used to finance the tax cuts, that would leave a dollar of interest savings to finance something else.

So if one assumes that the tax reductions were going to be made in any case, this supposed connection between debt repayment interest savings and the finance into those tax cuts wouldn't have any practical effect. However, when this tax-back guarantee is understood in conjunction with the commitment to repay at least $3 billion of debt annually, the tax-back guarantee effectively mandates a corresponding minimum level of tax reductions in every budget, regardless of changing fiscal circumstances.

Now, it's conceivable that if future revenues ended up being less than projected, this tax-back guarantee would in fact force the federal government to cut spending in order to fulfill its guarantee. We see this as quite problematic, given the pressing needs for investment in public services, public infrastructure, and other priorities.

I suppose that I should just clarify that if this current government were to say that it would have a policy of using interest savings from debt repayment to finance income tax reductions, there wouldn't necessarily be anything wrong with that. What I find really problematic about Bill C-52 is that it purports to enshrine that policy in legislation forever and for always. If we regard the budget-making process as an optimization problem, speaking mathematically, the best possible solution would come about by giving democratically elected representatives maximum latitude to evaluate the resources available, the needs that are out there, and to allocate funds accordingly. The tax-back guarantee places an artificial constraint on that process and reduces the latitude that our elected representatives will have to allocate resources among various priorities.

Essentially, I would suggest that even if the federal government is committed to this notion of using interest savings to finance tax cuts, it's a bad idea to enshrine that policy in Bill C-52, and I would definitely recommend against it.

The other issue I would like to suggest is around this whole notion of the fiscal imbalance and increased federal government transfers to the provinces. That was definitely a major aspect of budget 2007 and Bill C-52.

I suppose the notion of the fiscal imbalance really speaks to the insufficiency of funds to finance public services at the provincial level. Yet what we've seen since the budget is that the Government of Quebec has used a substantial amount of increased transfers to finance tax cuts instead. And if that's what happens in other provinces, then we really won't have made any headway in solving the fiscal imbalance.

My plea today is that in increasing these transfer payments to provincial governments, the federal government consider attaching some conditions to those transfers to ensure they're actually put into the public services that the people of these provinces need and that provincial governments said they needed the money to fund in bringing forth this notion of the fiscal imbalance. In particular, I think it's important, in light of increased Canada health transfers, for the federal government to take a much more active role in trying to enforce the key principles of the Canada Health Act.

With that, thanks very much for allowing me to appear before this committee. I very much appreciate the opportunity.

Business of the HouseOral Questions

May 17th, 2007 / 3:10 p.m.
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Peter Van Loan Conservative York—Simcoe, ON

I would not do that.

Tomorrow is an allotted day.

Next week is constituent consultation week, when the House will be adjourned to allow members to return to their ridings and meet with constituents to share with them the activities of Parliament since the last constituency break.

For the interest of members, I will quickly review our plan for the context of our overall legislative agenda.

As he requested, this is currently strengthening the economy week, where a number of financial bills moved forward. The budget bill was sent to committee and, hopefully, it will be reported back tomorrow, or soon, so we can deal with it at third reading when the House returns after the break.

Bill C-40, an act to amend the Excise Tax Act, was read a third time and sent to the Senate. Bill C-53, an act to implement the convention on the settlement of investment disputes, Bill C-33, the sales tax bill and Bill C-47, the Olympics symbol bill were all sent to committee and we all would like to see those back in the House for report stage and third reading.

In an earlier week, Bill C-36, the bill that makes changes to the Canada pension plan and the Old Age Security Act, was made into law after receiving royal assent.

Strengthening accountability through democratic reform week was a success with the consideration of Bill C-43, Senate consultation. We had three new democratic reform bills introduced that week: Bill C-55, to expand voting opportunities; Bill C-56, an act to amend the Constitution Act, democratic representation; and Bill C-54, a bill that would bring accountability with respect to loans. We hope to continue debate on that particular bill later today.

Bill C-16, fixed dates for elections, was given royal assent and is now law, which I think is the cause of the commotion now in all the committees where Liberals are using procedural tactics. Now they feel they can do it with a free hand.

Two other democratic reform bills are in the Senate, Bill C-31, voter integrity, and Bill S-4, Senate tenure. I really would like to have the term limits bill from the Senate for an upcoming democratic reform week if the opposition House leader can persuade his colleagues in the Senate to finally deal with that bill after 352 days. We may get 352 seconds in a filibuster, but they have had 352 days so far. They have been stalling for a year.

During the consultation week, I will be interested in hearing what our constituents think of the plight of Bill S-4 and the irony of those unaccountable senators delaying it.

We dedicated a good deal of our time focusing on making our streets and communities safer by cracking down on crime. Now that we have had the help of the NDP, we restored the meaningful aspects that the Liberals gutted in committee to Bill C-10, the bill to introduce mandatory penalties for violent and gun crimes. We are continuing to debate that bill today at third reading.

Bill C-48, the bill dealing with the United Nations convention on corruption, was adopted at all stages.

Bill C-26, the bill to amend the Criminal Code with respect to interest rates, was given royal assent.

Bill C-22, the age of protection, was given final reading and sent to the Senate, although it did spend close to, if not in excess of, 200 days in committee where the Liberals were obstructing and delaying its passage.

We made progress on Bill C-27, the dangerous offenders legislation. We would like to see that back in the House.

Bill C-9, An Act to amend the Criminal Code (conditional sentence of imprisonment) and a host of other justice bills are working their way through the system.

Members can advise their constituents that when we return, we will be reviving two themes, back by popular demand. Beginning May 28, we will begin again with strengthening accountability through democratic reform with: Bill C-54, political loans; Bill C-55, additional opportunities for voting; and Bill C-56, democratic representation.

Up next is a second go-round on strengthening the economy week with Bill C-52, the budget implementation bill, which will be called as soon as it is reported back from committee.

In the near future, we will have the improvement of aboriginal people quality of life week with Bill C-44. This bill will grant first nations residing on Indian reserves access to the Canadian charter of human rights. They have been denied this right for 30 years. Unfortunately, Bill C-44 is being delayed by the opposition. This is another bill being delayed by the opposition in committee.

After Bill C-44, I intend to debate Bill C-51. The agreement establishes the use and ownership of land and resources and will foster economic development. This bill illustrates Canada's commitment to the North and to settling land claims.

I wish all members a productive constituent consultation week and look forward to more progress on the government's legislative agenda when the House returns on May 28.

May 17th, 2007 / 12:55 p.m.
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The Chair Conservative Brian Pallister

Welcome back, committee members. To some new committee members, hello, and thank you for being here.

Mr. Chong and Mr. Gourde, welcome.

Pursuant to the order of reference of Tuesday, May 15, 2007, we are considering Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007.

We have before us the responsibility of dealing with the budget bill.

Yes, Mr. Del Mastro.

May 16th, 2007 / 4:50 p.m.
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The Vice-Chair Liberal Massimo Pacetti

I need unanimous consent for a motion to be adopted, and even if we have a motion, there is no way as chairman that I can ask for witnesses not to appear before a bill like Bill C-52.

Let's be reasonable here.

May 16th, 2007 / 4:05 p.m.
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Jim Flaherty Conservative Whitby—Oshawa, ON

In our current tax system, which will be changed by Bill C-52, taxpayers are generally required to convert their RRSPs to RRIFs, registered retirement income funds, and to stop contributing to their RRSPs by the end of the year in which they turn 69. Similarly, registered pension plan payments must generally begin by the end of the year in which the pension plan member turns 69.

As we know, many older Canadians are well and in good health and want to continue working and saving. Under the proposed changes we are increasing the age limit for maturing registered pension plans and RRSPs to 71 from 69. This will increase work and savings incentives for older Canadians, and this will be achieved by permitting additional RRSP contributions and accrual of pension benefits and not requiring any drawdown of tax-deferred savings at ages 70 and 71.

May 16th, 2007 / 4:05 p.m.
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Rick Dykstra Conservative St. Catharines, ON

Thank you, Mr. Chair.

I want to let you know that the lunch was excellent today with the delegation from Pakistan. You pushed hard to have a lot of us there; it's unfortunate that you couldn't make it.

Minister, thank you for coming to see us here at committee.

I'm anxiously awaiting your comments, and obviously the implementation of Bill C-52. While you may be a little closer to this age than I am, I certainly wanted to inquire, get your thoughts, and give you the opportunity to speak to the increase in the RSP age limit from 69 to 71, if you wouldn't mind commenting on that.

May 16th, 2007 / 3:55 p.m.
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Paul Crête Bloc Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC

Thank you, Mr. Chair.

Thanks to the support for the budget provided by Bloc Québécois members of Parliament, we are here today to discuss Bill C-52. This budget allowed a significant part of the fiscal imbalance to be corrected.

Three or four years ago, only Bloc Québécois members were talking about this matter in Parliament. Today, at least one financial aspect is resolved, but the true problem of fiscal imbalance, which is real and which requires the transfer of tax points, or some other kind of permanent transfer, still exists. If we keep this model, we will be depending on the government's financial health for years to come.

Bill C-52 is not perfect, but it will allow a budget to go into effect that provides more money to Quebec. This is what the Bloc Québécois members wanted.

Are you prepared to keep working so that the fiscal imbalance is really corrected, or will things just be as you mentioned in your introductory notes?

May 16th, 2007 / 3:45 p.m.
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Garth Turner Conservative Halton, ON

Thank you, Mr. Chairman, and welcome, Mr. Flaherty and officials.

Mr. Flaherty, I have a couple questions about the tax fairness plan. First, Bill C-52 and certainly the speeches and pronouncements you have made repeatedly have mentioned pensioners and seniors as benefiting from this, and you have used that same language again this afternoon.

Is that not, however, a little bit misleading, certainly in terms of the pension-splitting provisions? I understand that one has to have income that qualifies for a pension tax credit before one can split income. In other words, if you are a 70-year-old working at Wal-Mart and don't have registered pension income, you can't split your income.

How does this benefit seniors?

May 16th, 2007 / 3:35 p.m.
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Whitby—Oshawa Ontario


Jim Flaherty ConservativeMinister of Finance

Thank you, Mr. Chair. I am pleased to appear before the members of the committee today to discuss Bill C-52, which implements certain provisions of the 2007 budget, and other fiscal measures announced before the budget was presented.

I would note, as usual, that the remaining budget 2007 measures will be included in a second budget bill, which we will introduce in the fall session.

Since March 19 I've had the opportunity to travel across Canada to discuss the budget with Canadians from all walks of life. I've also had the opportunity to travel to New York and Tokyo and London to promote Canada and all that we have to offer.

People are aware of the fact that we're making our strong Canadian economy even stronger. They recognize that we are creating an environment that encourages investment, rewards hard work, and further opens the door for our investors and entrepreneurs and risk-takers.

Canadians have a right to be proud. Our country is a leader in the global economy. We have the most solid financial foundation of all the countries of the G-7. We are the only member country that continues to record budgetary surpluses and whose debt burden is being reduced.

Although we have only been the government for 15 months, we've moved the yardsticks considerably on a number of fronts, first with budget 2006, then our tax fairness plan, and then with budget 2007. Budget 2007 is an historic document that begins delivering on our long-term economic plan for Canada, called Advantage Canada.

Advantage Canada is a plan that seeks to mobilize the most compelling research, innovation, investment, and competitive forces in our society. It is a plan that sets out a bold and exciting course for a strong and united Canada, a Canada with purpose and passion that believes in itself and is a shining example to the world of what a great nation can be. It is a plan that will lead to a more rewarding future for Canadians and their families.

Advantage Canada focuses on creating five key advantages, which are reflected in this bill and reflected in budget 2007: first of all, a tax advantage, reducing taxes of all kinds and establishing the lowest tax rate on new business investment in the G-7; secondly, a fiscal advantage, eliminating Canada's total government net debt in less than a generation; third, an entrepreneurial advantage, reducing unnecessary regulation and red tape and increasing competition in the Canadian marketplace; fourth, a knowledge advantage, creating the best educated, most skilled, most flexible workforce in the world; and finally, an infrastructure advantage, building the modern bridges, roads, gateways we need to link our nation and make our workers and businesses more efficient.

Now, if we're to achieve these goals and maintain an upward trajectory, we need to adopt the measures contained in Bill C-52. As part of our plan to create a fiscal advantage for Canada, Bill C-52 proposes to enact our tax-back guarantee, which will provide taxpayers with a direct benefit from debt reduction. Lower debt will mean fewer interest payments, which will mean lower taxes every year.

The interest savings related to our national mortgage will be passed on to Canadians in the form of personal income tax relief. That relief will be permanent and ongoing.

Mr. Chair, I say and I repeat, Canadians are paying too much tax. This is why the government is also moving to create a Canadian tax advantage.

In fact, measures introduced by Canada's new government will reduce taxes for individuals by nearly $38 billion over three fiscal years. Bill C-52 proposes to implement several important tax relief measures, including the tax fairness plan I announced last October. Our plan increases the age credit amount by $1,000 to $5,066 as of January 2007. This will benefit low- and middle-income seniors by ensuring that less of their income will be subject to tax.

The plan also makes one of the most significant changes to the federal tax system to have been made in a long time. This is the decision to allow Canadian seniors, starting this year, to share up to half of their pension income with their common-law spouse.

Taken together, these measures will put some $1 billion a year more into the pockets of Canadian seniors.

Budget 2007 also proposes significant tax relief for Canadian families, a working families tax plan, and that relief is also set out in Bill C-52. The first part of the four-part plan helps Canadian families with children. The plan includes a new $2,000-per-child tax credit for children under the age of 18. It will provide more than 90% of tax-paying families with the maximum benefit of $310 per child.

The second part of the plan will increase the spousal and other amounts to the same level as the basic personal amount. Single-earner families will receive the same tax relief as that already provided through the basic personal amount to two-earner families; that is, the elimination of what has often been called the marriage penalty in Canada.

Third, the working families tax plan strengthens the registered education savings plan, RESP, to help parents save for their children's education. The $4,000 annual limit on RESP contributions will be eliminated and the lifetime limit will increase from $42,000 to $50,000. We will also improve access to RESP funds for part-time post-secondary students. Moreover, the maximum annual amount of the Canada education savings grant that can be paid in any year will be increased to $1,000 from $800, if there is unused grant room from previous years.

The fourth component of the working families tax plan builds on the tax fairness plan. It will raise the age limit for maturing RPPs and RRSPs to age 71 from age 69. This change recognizes that many older Canadians want to continue working and saving. It is important that we help them pursue these goals.

We are also committed to providing an economic environment in which Canadian businesses can thrive. In budget 2006 we reduced the corporate tax rate to 19% from 21%. Under the tax fairness plan, Bill C-52 proposes to reduce that rate by a further 0.5%, effective January 1, 2011, to 18.5%. Additional corporate tax measures in budget 2007 will be introduced in the second budget implementation bill, to which I referred earlier.

Of course, Mr. Chairman, there's much more to budget 2007 and to this bill than tax relief.

For example, in Bill C-52, Canada's New Government is proposing significant measures that will help to clean our environment and improve our health care system.

It is only through a healthier environment that Canadians can create the quality of life and standard of living to which we all aspire. With that goal in mind, budget 2007 invests $4.5 billion to clean our air and water, reduce greenhouse gases, combat climate change, and preserve our national treasures, which are also natural treasures, like the Great Bear rain forest on the central coast of British Columbia. Bill C-52 takes the first step by proposing to support major clean air and climate change projects through a new $1.5 billion Canada ecoTrust. This is an innovative way to engage the provinces and the territories and improve our environment for the benefit of future generations.

On health care, as we all know, Mr. Chairman, our health care system is an important part of what defines us as Canadians. That is why Canada's new government is committed to implementing the 10-year plan to strengthen health care. This will provide $41.3 billion in new federal funding over 10 years to the provinces and territories. In support of that commitment, Bill C-52 proposes to provide up to $612 million to help eligible provinces and territories move forward with patient wait time guarantees in key areas such as cancer treatment, heart procedures, diagnostic imaging, joint replacement, and sight restoration.

Mr. Chair, in order for Canada to be even better tomorrow, the national fiscal balance must be re-established, starting today. To do this, we must provide the provinces and territories with the funds they need.

The needs include such matters as an unprecedented and long-term investment in public infrastructure; better health care; better-equipped universities; cleaner oceans, rivers, lakes, and air; training to help Canadians get the skills they need.

Mr. Chairman, restoring fiscal balance is very much about building a stronger, safer, and better country.

I would also like to mention that the harmonized sales tax provinces—Nova Scotia, New Brunswick, and Newfoundland and Labrador—have each announced their intention to participate in the foreign convention and tour incentive program proposed in Budget 2007. Accordingly, I am pleased to announce that the Government of Canada plans to propose motions to amend Bill C-52 to extend the application of the new program to the 8% provincial component of HST, effective April 1, 2007.

Given that such amendments have the effect of increasing the amount of the rebates to be paid under Bill C-52 it is the government's intent to seek a royal recommendation and to propose the motions at report stage.

In Bill C-52, Canada's new government is taking action by proposing a new formula that improves and enriches equalization, and a territorial formula of financing. It also puts major transfers, such as the Canada social transfer and Canada health transfer, on a more solid footing and makes treatment of provinces fairer for those transfers.

In fact, under Bill C-52 we are proposing to deliver more than $39 billion in additional funding to the provinces and territories. This is funding that will restore fiscal balance in Canada.

Mr. Chairman, that is what Bill C-52 is all about. I look forward to answering questions from the committee.

I should mention that officials from the Department of Finance are here with me to provide any further clarification the honourable members may wish to have on any of the measures in the bill.

Thank you.

May 16th, 2007 / 3:35 p.m.
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The Vice-Chair Liberal Massimo Pacetti

I'd like to get started right away, because we only have about an hour with the minister.

We are here, pursuant to the order of reference of Tuesday, May 15, 2007, to examine Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007.

Mr. Flaherty, do you have an opening statement for us? Yes, okay. So if you can keep it to a brief intervention, then members will have questions for you.

I appreciate your coming before us, taking time out of your day. The floor is yours. Thank you.

Budget Implementation Act, 2007Government Orders

May 15th, 2007 / 6 p.m.
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The Speaker Liberal Peter Milliken

The House will now proceed to the taking of the deferred recorded division on the previous question at the second reading stage of Bill C-52.

The hon. chief government whip is rising on a point of order.

The House resumed from May 14 consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the second time and referred to a committee, and of the motion that this question be now put.

EqualizationOral Questions

May 15th, 2007 / 2:40 p.m.
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Robert Thibault Liberal West Nova, NS

Mr. Speaker, tonight the House will vote on Bill C-52, the budget bill that breaks the promise to Nova Scotia and Newfoundland and Labrador on the Atlantic accords.

Will the Conservative MPs from those two provinces do the right thing, do what they were sent to Ottawa to do, and support their constituents by voting against this broken promise?

Will the Chief Government Whip permit Atlantic Conservative members to vote in support of their constituents and against this flip-flopping funding fiasco?

May 15th, 2007 / 1:55 p.m.
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The Chair Conservative Brian Pallister

Thank you very much, Mr. Purdy and Mr. Ernewein. It's nice to see you. We appreciate your testimony today. I think we're all cognizant of the slowness with which change occurs on issues like this that are extremely complex, and we appreciate your participation in the discussion.

Committee members, in reference to Bill C-52, should we receive an order of reference on Bill C-52 at some point in the near future, notice will be sent to your offices in the morning for a meeting to take place tomorrow afternoon from 3:30 until 5:30. So I give you possible notice of such a meeting occurring.

Thank you, committee members, for your rapt attention and focused discussion on this issue.

The meeting is adjourned.

May 15th, 2007 / 1:35 p.m.
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Tom Lukiwski Conservative Regina—Lumsden—Lake Centre, SK

It all comes down to the ability for members to be able to speak and express opinions, whether that be their personal opinions or whether it be opinions based on collective wisdom of the constituents. It certainly speaks to the fact that this ability would be compromised and in fact completely curtailed, because combined opposition members then would absolutely have the ability and the right to be able to control everything from procedures and practices to Standing Orders to long-standing conventions to, in fact, legislation. I don't believe by anyone's definition, regardless of political stripe, that would be an acceptable practice.

I believe Canadians understand the fact that when they express their voting intention on polling day, they expect that the party who receives the most votes by individual members will form a government of sorts. Sometimes it will be a minority; sometimes it will be a majority. It appears the recent practice has been to elect minority governments, and there's nothing wrong with that. If a minority government can function and function well, and in the spirit of compromise perhaps and in the spirit of cooperation it still is able to function by bringing forward legislation that is debated and discussed and then ultimately passed into law, I think most Canadians would say, well, you know, the system works. But I do not believe members of the Canadian public or voters, the ordinary Canadians who cast ballots on any polling day, would agree to the fact that, regardless of who is elected as the government of day, they should not have the ability to advance their own agenda, that in a minority government the opposition in fact is governing this country.

That's why we have votes of non-confidence, and that's why we have elections. I would suggest to the members of the opposition that if they want to govern, well, just bring us down. You have the combined votes. We have a confidence bill, quite frankly, coming up. We have a vote tonight on Bill C-52, and if there's a desire by this combined opposition that they want to see an election right now, well, clearly that's a confidence vote and they have the ability to do so, as they do from time to time over the course of any Parliament.

That's the way the system works. There are checks and balances involved in any Parliament. There are checks and balances that have been put into place in the procedures and practices that we follow, and it's for that very reason that Parliament functions.

So to me, listening to the motion that was brought forward, that was voted in favour of by opposition members here, I think that to stop debate flies in the face of the very thing that I'm talking about. It speaks to the fact that members of the opposition want to ignore convention, long-standing practices, and start working on their own agenda and start working on a different set of practices without even consulting members of Parliament. I just don't think that's right, and I think that most Canadians would, without question, agree with my position on that.

That's why I say that I have—

Income Tax Amendments Act, 2006Government Orders

May 14th, 2007 / 4:15 p.m.
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Pierre Paquette Bloc Joliette, QC

Mr. Speaker, I thank the member for his question. Indeed, Bill C-33 contains interesting aspects regarding the reduction of tax evasion. However, it is still just a band-aid on a cancer. We think there are other priorities. I spoke about the tax treaty with Barbados. If the Minister of Finance and the Conservative government really want to reduce tax evasion, they will have to amend that treaty and the law in order to turn off the tap. Until now, we have not seen the minister show any such commitment.

There has been a lot of talk about interest deductibility for Canadian companies investing abroad. The minister backed off and said that he was doing this to prevent tax evasion in tax havens. This is also a measure which could be interesting in some regards, but it is throwing the baby out with the bath water. So, it is good to see the minister backing off from his initial plan, but even if he maintains the non-deductibility of interest charges for Canadian companies investing abroad, this is still a small measure in the big picture. It is somewhat the same for income trusts.

During the proceedings of the Standing Committee on Finance, I was very surprised to see that the Minister of Finance was not able to demonstrate to us that existing income trusts were generating a tax loss that is extremely harmful to the Government of Canada's financial position.

Minister Audet told me that, in the case of Quebec, these trusts were responsible for a shortfall of about $40 million. That is significant, particularly since the Prime Minister made a promise regarding this issue during the election campaign. It seems to me that the government could have found a solution that is more respectful of the two and a half million Canadians who contributed to income trusts and who, among other things, probably believed the Prime Minister during the election campaign, when he promised that he would not touch these trusts.

That said, my greatest concern with income trusts was their effect, in the longer term, on Canada's economic development. For example, BCE, a corporation, was to become an income trust, because of the pressure exerted by one competitor, TELUS, and not because of its own corporate interests. In my opinion, this was more important than the issue of revenue losses for the federal or the Quebec government.

The hon. member is right when he says that this is creating a perverse effect, particularly regarding the value of the Canadian dollar. Many of these businesses represent a minor investment for foreigners, particularly Americans. So, we found out that there was a very real risk.

I have learned one lesson from all this. As with interest deductibility, as with income trusts, and as with many other issues, the Minister of Finance has good intentions, but he takes measures that seem improvised and whose consequences have not, in my opinion, been properly examined.

In conclusion, this will not prevent the Bloc Québécois from supporting Bill C-52. However, it could mean that, in the coming years, all parliamentarians, and the members of the Standing Committee on Finance, may have to look at this issue again, in order to suggest to the government, regardless of which party may be in office at that time, ways that are more effective on an economic, fiscal and financial level.

Budget Implementation Act, 2007Government Orders

May 14th, 2007 / 12:45 p.m.
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The Acting Speaker Conservative Royal Galipeau

Pursuant to the request by the chief opposition whip, the vote on Bill C-52 will be held at the expiry of the time provided for government orders tomorrow.

Budget Implementation Act, 2007Government Orders

May 14th, 2007 / 12:15 p.m.
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Peter Julian NDP Burnaby—New Westminster, BC

Mr. Speaker, it is unfortunate that I only have 10 minutes to address Bill C-52 because I could take far longer to talk about what has been omitted and the poor budgetary policy contained within this budget.

However, after a year of the government, it is quite obvious that it has taken all its lessons from the former Liberal government. We have seen in the past year the softwood sellout, which was started by the Liberals and continued by the Conservative government. I will come back to that in a moment. We have seen the continued push on SPP, deep integration, started by the Liberals and continued by the Conservatives.

What we see in the budget is the continued push for corporate tax cuts rather than actually dealing with real issues that Canadians from coast to coast to coast are experiencing. There are $9 billion in corporate tax cuts that are being continued. The Conservatives are continuing the Liberal practice of shoveling corporate tax cuts off the back of a truck. What we see here is just a continuation of the failed Liberal policies we saw over 13 years, by the Conservatives.

What is the context of this budget? What should have been addressed? As Statistics Canada told us just this week, and after study after study has proven, is that we are experiencing in Canada a clear and growing prosperity gap. In fact, “gap” is perhaps too innocent a term. It is indeed a prosperity gulf.

As Statistics Canada reported as recently as last week. but as its studies over the past decade have shown, since 1989 the real income for most Canadian families has actually gone down. It is a reality that the Conservatives have not grasped and the Liberals did not grasp before that.

If we look at the figures since 1989, since the signing of the Canada-U.S. Free Trade Agreement, the poorest 20% of Canadians have seen their incomes collapse. They have lost a month of income in real terms. It is no wonder we are seeing burgeoning numbers of homeless Canadians across the country when the poorest Canadians are actually living on a month's less income than they were in 1989.

It continues with the lower middle class. They have lost two weeks of salary in real terms. Even the upper middle class has seen stagnation. They have not gained a dime more since 1989. They are living on the same income they were living on in 1989.

Who has profited by the failed Liberal economic policies continued by the Conservatives? We all know that it is the wealthiest of Canadians. The wealthiest 5% of Canadians have seen their incomes skyrocket. Corporate CEOs and corporate lawyers in the boardrooms of Canada are doing better than ever before. In fact, coming from Vancouver on the red-eye last night, I read another article about CEOs giving themselves multi-million dollar pension incomes. While the corporate sector has been pushing to cut back on services that working Canadian families need desperately, they are giving themselves unprecedented awards, even for mediocrity.

That is the context of this budget. Eighty per cent of Canadian families are earning less now than they were in 1989. It is a prosperity gap. It is an income crisis that must be addressed.

What do we see in the budget? In the midst of that income crisis; in the midst of a homelessness crisis that we have not seen since the 1930s where 300,000 Canadians will be sleeping out in the parks and on the sidewalks of our nation tonight; in the midst of a fall in real income for 80% of families; a gutting of our manufacturing sector; and the giveaway of our resources, raw logs from British Columbia and oil and gas resources from Alberta, at fire sale prices, which only profits corporate CEOs and corporate lawyers, we have a budget that addresses more corporate tax cuts and continues subsidies paid by Canadian taxpayers to the profitable oil and gas sector.

I come from British Columbia and when I left on the red-eye yesterday to get back to Ottawa, gas prices were at $1.30 a litre. A study that came out last week clearly showed that there was no justification for gas prices being more than 97¢ or 98¢ a litre right now given the current international price for a barrel of crude oil. We have this gouging by the big oil and gas companies, a favourite of the Conservative government, but in addition to that, as these companies reap record profits, the Conservatives shovel more money at them, taxpayer money.

The Conservatives do not deal with homelessness or with the crisis in the health care sector. They shovel hundreds of millions of hard-earned Canadian taxpayer dollars at the oil and gas sector. It is absolutely appalling.

What is in the budget? There is no national housing strategy and no national transit strategy. There is nothing on employment insurance. It contains nothing on establishing a $10 minimum wage, which is something the NDP has been calling for now for some time. Obviously, if we were to take a look at the poorest of Canadians, we would see that 20% of Canadians have lost a month's salary over the past 18 years. That needed to be addressed by the government but, since it only listens to the boardrooms of the nation, it did nothing to deal with this crisis of income and nothing to establish a $10 minimum wage.

The budget has no poverty reduction strategy and no plan to end student debt that is now at record levels. The budget has no cancellation of the corporate tax cuts started by the Liberals. In fact, the Conservatives just continue to shovel that money at the corporate CEOs and corporate lawyers.

The budget has nothing for pharmacare, home care, long term care in the health care sector; nothing for improved access to health care for aboriginal peoples; nothing about coordinated training of medical professionals; and nothing about catastrophic drugs. The budget has no significant new money for aboriginal Canadians who, along with Canadians with disabilities, are the poorest of the poor of Canadians.

The budget says nothing about autism. There is no ban on bulk water exports, which is an issue that was started by the Liberals and being continued by the Conservatives. We see nothing for seniors and no increase in the old age supplement as my colleague, the member for Sackville—Eastern Shore, just mentioned. We see nothing about providing the kinds of benefits that veterans and their widows and spouses deserve. We see no action following the NDPs' promotion of the veterans first motion that was adopted by this Parliament. The government talks the talk but it does not walk the walk and, therefore, nothing for veterans.

What we see across the country is absolutely no effort by the government to change track after 13 years of Liberal obsession with corporate tax cuts at the expense of everything else. We see nothing to deal with that income crisis.

I will now talk about British Columbia because that is the most egregious part of this budget. The Minister of Finance rose in the House and said in his budget speech:

From the majestic peaks of the Rocky Mountains [in Alberta] to the rugged shores of Newfoundland and Labrador, many of the most beautiful places on earth are in Canada.

This budget completely neglected British Columbia. We see that on the equalization formula that was adopted. We see absolutely no action at all in any of the key areas that British Columbians have been crying out for and pushing the Conservative government to take action on.

What have we seen from the government on the pine beetle which has devastated the interior of British Columbia? The government actually withdrew the funding last year that had been allocated to the pine beetle, even though it was far below what was needed. This year it has allocated pennies on the dollar. We have seen a lot of photo ops and press conferences but very little action has been taken.

The Conservatives promised to take action on leaky condos but no action has been taken.

It is no surprise to me that the poll which came out this weekend shows the Conservatives third in British Columbia now. The NDP are at 30% , the Liberals at 29% and the Conservatives at 23%. Quite frankly, they do not deserve British Columbians' support because this budget does not include British Columbia.

Budget Implementation Act, 2007Government Orders

May 14th, 2007 / noon
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Navdeep Bains Liberal Mississauga—Brampton South, ON

Mr. Speaker, I greatly appreciate the opportunity to speak to Bill C-52, the budget implementation act.

As I stand here today to represent the concerns of my constituents of Mississauga—Brampton South with respect to the 2007 federal budget, my comments and remarks will focus on three areas: economic competitiveness; social issues and the lack of social investment; and how the budget has damaged our reputation abroad.

I am glad to hear today that the Minister of Finance has withdrawn a major part of a controversial budget measure. I believe it is widely accepted that this has been the worst policy to come out of Ottawa in over 35 years. He understands now that he should allow interest deductibility to ensure Canadian companies can be more competitive abroad. The Minister of Finance also mentioned in his remarks this morning that he would put forth a panel of experts to review Canada's international tax system. More work needs to be done in this area and he has a great deal of explaining to do.

As I indicated, my remarks on the budget will focus on the economic aspect of the budget. It is so important at the federal level that the government show leadership with respect to how to improve competitiveness in our country.

One area, as I have indicated, is the reversal of the Finance Minister on interest deductibility. I will outline the concerns we had raised in the past and why this decision was made by the Minister of Finance. It was through the hard work of our finance critic and our leader of the official opposition that really put forth a clear cut message to the Canadian public of how poorly thought out and poorly conceived this measure was.

The proposal in the 2007 budget eliminated deductibility of interest accrued to finance foreign assets. The Conservatives are forcing Canadian companies to compete with one hand tied behind their backs. Competing businesses in the U.S., Japan and Europe all have this tool at their disposal. The Conservative government at least was planning to take this away.

Companies in the U.S. Japan and Europe are all able to write off interest on loans taken out to finance foreign assets. Canadian firms have also been able to that for more than 30 years. This is a very important tool to promote competitiveness.

At a time when the entire world is headed forward, the Conservative government is making it increasingly difficult for Canadian companies to compete globally.

I raise this question in the House because I do not understand why the Finance Minister has difficulty with foreign companies acquiring Canadian companies, but he does seem to have a fundamental problem with the ability of Canadian companies to compete abroad. Removal of the interest deductibility would compromise the competitiveness. Again, I am thrilled the minister has made this reversal. There are probably many measures that I will discuss, which I hope he gets to re-evaluate and reconsider and maybe change the direction of the budget.

Not only is it something about which the Liberals and many Canadians have expressed concerns, but also in the business community as well. The president of the Canadian Chamber of Commerce said this with respect to the budget:

We don't see any broad-based tax relief either for taxpayers or businesses.

The government promised in November that they were going to make Canada more competitive and control spending and I think they broke that promise today.

I will also highlight a theme of broken promises in the budget as well. One area where I believe the Conservative government really misled Canadians was with respect to tax fairness, as it stated. The Conservatives cut the GST, but they increased personal income taxes.

We all know that to improve productivity, it is absolutely vital we have more disposable income for our Canadian public. To improve disposable incomes and to help build greater productivity, the first target for a tax reduction should always be income taxes, not consumption taxes.

In the previous government we lowered the tax rates for low and middle income Canadians in order for them to make greater investment in the economy and save more money. The Liberal government brought forth a comprehensive package to eliminate billions of dollars in taxes for low and middle income Canadians. When the government cut the GST rather than implement our personal income tax, the Finance Minister really constrained his government's fiscal capacity.

A study released on March 29, 2006, by the independent non-partisan research institution, the Canadian Centre for Policy Alternatives, found that the 5% of families earning over $150,000 a year would receive nearly 30% of the benefits of the Conservatives tax cuts, an average of $2,000 roughly savings in each year. Therefore, 5% would receive 30% of the benefit of the tax cut. However, almost over half of Canadians families earning less than $40,000 would only receive 20% of the benefits of the Conservative tax cuts, an average of $163. Their tax fairness policy is about broken promises and appeasing the more affluent in society.

Another issue that again highlights the government's inability to improve productivity and competitiveness and focuses on its trend of broken promises is income trusts. The income trusts reversal hurt Canadian investors, particularly seniors. The decision to cut income trusts wiped out more than $25 billion in savings overnight and reversed a key Conservative campaign promise, a promise on which many people relied. They took their hard-earned savings and invested it in income trusts. Seniors whom I have met at the town hall meetings I have had over the past month have clearly shown their frustration with the government. They are completely appalled with the government for breaking such an important promise and they do not understand the rationale behind it. The government swiped billions of dollars from seniors through income trusts savings as well.

We have already seen not only in income trusts a broken promise, but now we are beginning to see a trend in foreign acquisitions. We have already seen great Canadian companies such as Inco, Molson's, Defasco and Hudson's Bay Company taken over by foreign entities, and Alcoa may be next.

The Conservatives took this initiative with the income trusts by crippling it and using the non-refundable 31.5% instead of the Liberal plan. We put a plan forth of a 10% tax rate which would be refundable to all Canadians, creating an opportunity for Canadians who have invested in income trusts.

Tom d'Aquino, president of the Canadian Council of Chief Executives, has said that the decision with respect to income trusts:

—may seriously undermine the competitiveness of Canada's homegrown champions—the companies that are most active and most successful in building global businesses from head offices in Canadian communities.

It is clear, if we look at the government's agenda when it comes to economic policy, it has crippled our ability to remain productive and has hurt our competitiveness. It has shown the government has continuously broken promises that it made to the Canadian public.

However, it does not end there. Another area in which my constituents have expressed a great deal of concern is with respect to social justice issues and social policy. There was absolutely no mention in the budget of homelessness or affordable housing, an issue that resonates in my constituency, across Ontario and across the country as well.

Constituents of Mississauga—Brampton South understand how important this is. The government has cut money from Status of Women, youth programs and the list goes on and on, and again, no investment in these initiatives.

My last is with respect to international trade. This is an area where I believe the government truly had an opportunity to put Canada on the map. It had an opportunity to showcase Canada to the world.

When we were in power, as the Liberal government, we put forth the Can-trade $485 million initiative, which invested in branding Canada. The Conservatives completely wiped that out to replace it with a measly $60 million over two years. It has closed consulate offices and cut funding. The Auditor General's report clearly demonstrates a lack of strategic planning, low morale and the department as well. Therefore, the government has a lot of explaining to do when it comes to the budget.

I am very fortunate that I represent a constituency which is very diverse and has a population of about 130,000 people. It is a hub of economic activity. I have an airport there, looking to the government to show leadership in reducing airport rents. I have major highways and we are looking for funding for infrastructure. Many head offices are looking to expand their businesses abroad and build strong Canadian brands outside of Canada. My residents want to enjoy a high quality of life, but they are very disappointed with the government's poor economic policies, a lack of compassion in investment in the most vulnerable in our society. The government is hurting our reputation abroad.

We are taking steps backwards and we need to provide good public policy, not bad public policy. I think the Canadian public is very impressed that through its hard work and sound management we are in a strong position to create a better and prosperous future for our children. Canadians looked forward to the government to continue to reverse some of its policies. In the meantime, I and the Liberal Party will not support the budget.

The House resumed from April 23 consideration of the motion that Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, be read the second time and referred to a committee, and of the motion that this question be now put.

Opposition Motion—FinanceBusiness of SupplyGovernment Orders

May 10th, 2007 / 3:15 p.m.
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Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Mr. Speaker, first I would like to congratulate my colleague, the member for Jeanne-Le Ber, for his speech. Like him, I rise today to speak to the motion tabled by the Liberal Party with regard to income trusts.

As pointed out by my Bloc Québécois colleagues, we supported both the ways and means motion and the 2007-08 federal budget. The latter changes the taxation of existing income trusts, which will receive the same tax treatment as corporations at the end of a four-year transition period. Furthermore, it will no longer be possible to establish new income trusts.

There are reasons for our support. First, we must realize why corporations register as income trusts. In the March 2007-08 federal budget, the Minister of Finance indicated that, year in and year out, the different levels of government lost $400 million in revenue because of income trusts. And this was before companies such as Bell and Telus announced that they would convert to income trusts which, in and of itself, would have inflated tax losses to about $1 billion annually. This measure, which has allowed corporations to avoid paying significant amounts of tax, had to be eliminated.

Furthermore, the income trust structure practically forces a company to pay 100% of its profits to its shareholders at the end of the year. Although the shareholders are the main beneficiaries of this measure, it has a negative impact on the economy. If the company retains part of the profits for an investment project, for instance, it must pay the maximum amount of taxes on that non-distributed revenue. This is why, in addition to the tax losses associated with the conversion of a growing number of income trusts for reasons that are strictly tax motivated, we must also look at the potential loss of productivity in our businesses, in the context of a serious productivity crisis in the manufacturing sector of Quebec and Canada. Between 2005 and 2006, Canada dropped from seventh place to tenth place in the world, according to the World Competitiveness Yearbook 2007.

Over the past few months, thousands of investors have been pressuring members of Parliament to reverse this decision. I am sure we have all met citizens who have come to us to tell their stories. In my riding, some of my constituents told me that the drop in the stock market cost them thousands of dollars. During the last election campaign, the Conservative Party promised not to touch income trusts. Investors trusted that party, trusted the government, and either kept such investments or acquired more, which meant that those investments became even more attractive and we saw an artificial inflation of the price. The Conservative government is therefore partially responsible, because it deceived thousands of investors during the last election campaign.

The Bloc Québécois supports this decision, but deplores the Conservatives' lack of honesty during the last election.

It goes without saying that steps had to be taken to eliminate the corporate practice of converting to income trusts in order to avoid paying taxes. Until now, only shareholders were taxed on dividends, not the trust itself.

I also want to mention the importance of keeping campaign promises to voters. A promise made to the people is sacred and must be respected. During the election campaign, the Conservatives had two options. They could easily have said that they would make changes once in power, or they could have avoided creating false hope by saying nothing about it. In other words, they should have stuck to what was in place and made a decision at the right time.

In 2006, companies that decided to convert to income trusts accounted for $70 billion worth of market capitalization, and that is not including telecommunications giants BCE and Telus, which also planned to convert.

Canada has about 250 income trusts worth about $200 billion in sectors ranging from real estate, oil and gas and telecommunications to food processing and manufacturing. The income trust craze was getting so big that it was endangering the national economy.

Again yesterday, the Bloc Québécois issued a news release demanding the elimination of tax havens. My colleague talked briefly about tax havens earlier. It would have been nice to see some steps taken against these tax havens, which are causing Canada to lose billions of dollars.

Given that some companies are taking advantage of interest deductibility to deduct interest charges in a number of jurisdictions, which is a form of tax evasion, and given that the Bloc Québécois is strongly opposed to tax evasion and the use of tax havens, we cannot support this motion. We will vote against the Liberal Party's motion.

Let us not forget that the bill concerning interest deductibility will be studied in committee, and that the Standing Committee on Finance will have an opportunity to submit its recommendations. Everyone will have the opportunity to suggest solutions to this problem during committee meetings.

The Bloc Québécois is very concerned about the increase in tax evasion in Canada. Canadian investments in tax havens between 1990 and 2003 soared, reached unprecedented levels, increased considerably. Canadian corporations invested large and growing amounts in countries recognized as offshore financial centres, particularly in the Caribbean. Assets held by the financial sector have practically increased tenfold, rising from $8 billion in 1990 to $72 billion in 2003. Barbados, where Canadian corporations operate 1,700 subsidiaries, is ranked the third most popular destination for Canadian capital abroad, after the United States and Great Britain.

Bill C-52 which is presently being studied by the House, amends the tax treatment of income trusts in order to eliminate the advantage of this entity over a corporation.

The Bloc Québécois has been giving thought to the issue of income trusts for a few years. We do not want income trusts to be abolished. One solution might be to introduce a minimum tax on income trust profits rather than preventing corporations from establishing themselves as income trusts.

With this bill, the government will impose a 21% tax for 2007 and will add 13% in subsequent years.

In closing, we will vote against the Liberal Party motion.

Business of the HouseOral Questions

May 10th, 2007 / 3 p.m.
See context

York—Simcoe Ontario


Peter Van Loan ConservativeLeader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, as you are aware, this week is strengthening accountability through democratic reform week. It has been a busy week for the democratic reform family of bills.

We sent out invitations for the first birthday of Bill S-4, the Senate tenure bill, which Liberal senators have been delaying for almost a year now.

While we are disappointed with the behaviour of Bill S-4's caregivers, we did have some good news this week with the successful delivery of two new members of the family: Bill C-54, a bill to bring accountability with respect to loans; and Bill C-55, a bill to expand voting opportunities.

There is more good news. We are expecting.

Tomorrow, I will be introducing an act to amend the Constitution Act, 1867, on democratic representation, which is on today's notice paper.

Bill C-16, fixed dates for elections, was finally allowed by the clingy Liberal-dominated Senate to leave the nest when it was given royal assent last week.

With respect to the schedule of debate, we will continue today with the opposition motion.

Friday, we conclude strengthening accountability through democratic reform week with debate on the loans bill, possibly the Senate consultation bill and, hopefully, Bill C-52, the budget implementation bill.

Next week will be strengthening the economy week, when we will focus on helping individuals, families and businesses get ahead.

Beginning Monday, and continuing through the week, the House will consider: Bill C-52, the budget implementation bill; Bill C-33 to improve our income tax system; Bill C-40, to improve the sales tax system; Bill C-53, relating to investment disputes; and Bill C-47, the Olympics bill, which help us have a successful Olympics. Hopefully, we can get to Bill C-41, the Competition Act.

If time permits, we will also call for third and final reading Bill C-10, the minimum mandatory sentencing bill.

Thursday, May 17 shall be an allotted day.

Wednesday, May 16, shall be the day appointed, pursuant to Standing Order 81(4)(a), for the purpose of consideration in committee of the whole of all votes under Canadian Heritage of the main estimates for the fiscal year ending March 31, 2008.

Thursday, May 17, shall be the day appointed for the purpose of consideration in committee of the whole of all votes under National Defence of the main estimates for the fiscal year ending March 31, 2008.

Finally, there is an agreement with respect to the debate tomorrow on the 13th report of the Standing Committee on Public Accounts. I believe you would find unanimous consent for the following motion.

I move:

That, notwithstanding any Standing Order or usual practice of the House, the debate pursuant to Standing Order 66 scheduled for tomorrow be deemed to have taken place and all questions necessary to dispose of the motion to concur in the 13th Report of the Standing Committee on Public Accounts be deemed put and a recorded division be deemed requested and deferred to Wednesday, May 16, 2007, at the expiry of the time provided for Government Orders.

Business of SupplyGovernment Orders

May 10th, 2007 / 11:20 a.m.
See context


Paul Crête Bloc Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC

Mr. Speaker, the Liberal party has chosen to introduce an opposition motion today that raises a good number of points for which we are far from having ideal solutions. Having said that, this motion demonstrates how the approach of the Conservatives lacks attention to detail. They have not really found a way to solve the problems. However, the motion offers solutions that I find inadequate. Therefore, the Bloc Québécois will vote against this motion, as it is presented.

The government has not properly dealt with some problems. For example, GST rebates for tourists comes to mind.

An announcement was made but it was recognized, after the fact, that there were problems in terms of organized tours, as well as outfitters and duty-free shops. They have corrected part of that, but not everything has been settled. Since there was some improvisation, the result was that major changes had to be made later.

It is the same for income trusts, except that it is even more serious.

During the election campaign, the government said that it did not want to change the rules of the game.

Some of my fellow Quebecers, who are not necessarily supporters of the Bloc Québécois, have told me that they put their savings into these entities. They thought that the rules of the game were clear, but they were changed without notice. They want to know whether a solution can be found to this problem.

We have listened to them. We have to abide by the principle that companies and trusts pay their share of income tax. On the other hand, is there no solution that would counteract the negative effects this is having, particularly for individual investors? We have to put a little more thought into finding a solution. This is another example of the government’s ad hocery.

On the question of deductibility, that remains to be seen, because the bill that will allow this part of the budget to be implemented has to be tabled first. Everyone has to know the rules of the game.

Next Monday, it seems, the Minister of Finance will make a speech to clarify the situation. However, it is obvious that the government has been very inept, and has more or less thrown the baby out with the bathwater. It sent a very ambiguous message: that the interest will no longer be deductible when investments are made for the good of our economy, even though a number of countries in the world apply that rule. On the other hand, not enough attention was drawn to the fact that this was going to eliminate tax avoidance. More work will be needed on that subject.

The Liberals have introduced a very partisan motion. When considering economic issues like these, it is a little dangerous to try to go too fast. Strangely, they seem to be reacting that way because the Conservatives went too fast themselves.

On the question of interest non-deductibility, in order to do the job, the measure must obviously target only the abuse, very precisely. We must ensure that we achieve that result. It will not be easy, because these are very complex questions. It would be wise to think about it very carefully.

The Liberal critic is talking about a working group to discuss it, and the Minister talked about the need to fine-tune things. Maybe they could get together.

It is important that a clear and moderate message be sent to the economic community and the public as a whole. I think we could agree on that.

The government says that it wants to tackle tax havens. In fact, the Standing Committee on Finance is meeting to consider the questions raised in a motion by the Bloc Québécois. The ultimate tax haven, the one the government should be taking on, is Barbados. Canadian companies that invest money there, knowing that the interest rate there is very low, can bring those profits back here without being taxed. That is not the general rule in tax treaties. Ordinarily, they provide that when money is invested in another country, it is taxed when it returns to Canada, if the two tax systems are not equivalent. But under the Liberal government, a little paragraph was added—in section 5907—exempting that money from taxation, with the result, according to the Auditor General’s 1990 estimates and the extrapolation by Statistics Canada, that this income amounts to $4 billion annually. It comes in from Barbados and it is not taxed.

I believe, at a rough estimate, that we end up losing some $800 million in income tax revenues. Obviously this money that businesses do not pay—because they take advantage of this tax haven—is money that others pay, middle class people and all taxpayers who do their part. This also means less money that could be allocated in part to social programs. On one hand there are companies that can bring home profits without being taxed, and on the other there are people who are paying too much in taxes because of this.

That is a considerable amount of money. There is a way of settling this problem, namely by quite simply getting rid of section 5907. This very concrete and practical measure could be implemented. It would immediately have a very significant effect and it would send the following message to all taxpayers: we are trying to make the situation a bit fairer; we do not tolerate this sort of situation. This is a tax loophole with the ability to disappear clearly and neatly, if the practical solution is applied. However, as far as interest deductibility is concerned, it is not easy to know what the solution is.

So there is a problem. The Liberals are dealing with it in one way in the motion, but in our opinion a lot of things are getting all mixed up at once. This issue is being associated with the fact that there are a lot of foreign takeovers of companies. This may be one element, a variable that is taken into account, but it is also the result of several years of operation in Canada, during which people were told that this is a free market and we would see, in the end, whether we were winners.

A detailed analysis of this question is needed. It is true that many Canadian companies are buying foreign companies. The net result, though, even if there are more that buy foreign companies, as far as the size of investments goes, we are clearly in the red. This matter must be examined. The solutions, however, are systemic, and a much broader policy will be needed than the one found in the motion we are discussing today.

The first aspect in the motion is the issue of non-deductibility. The second aspect is the issue of trusts.

There is a big problem with income trusts because people have to pay their taxes. It became clear that the mechanism that was created for a certain kind of capital was being used by companies in sectors that clearly did not need it. A trend was developing, especially in telecommunications. It became a way to get a tax break without producing wealth.

I think that the underlying principle was unacceptable. That being said, the way they did it was also unacceptable because they pulled the rug out from under investors without warning after having told them that the rules of the game would not change. People who had saved up $50,000 or $100,000 or $200,000—their life savings or at least a substantial portion thereof—were deprived of income that, in many cases, they had worked for their whole lives. I can well understand why people who have been affected by this issue are angry.

So how should we react to the Liberals' motion? Apparently, according to the Liberals' proposal for income trusts, people should be taxed according to the alternative solution the Liberals proposed, which was summarized in the 14th report of the Standing Committee on Finance.

Let us not forget that this report was the product of a consensus indicating that solutions had to be examined. The Bloc Québécois proposed a simple solution: extending the moratorium, the transfer period, from four to 10 years. The Liberals suggested another proposal that we consider unacceptable. As such, that part of the Liberals' motion is totally unacceptable to the Bloc Québécois because they are trying, in a roundabout way, to make it all non-taxable. I think that that aspect of the motion has no future.

The bottom line is that there is now a perception among electors and the general population that some people are more equal than others when it comes to taxation. Because of the complexity of the systems, because of what has been developed over the years, because of the expertise that some companies may have access to, there are some people who maximize their tax benefits, to the limit and to the extreme. Hence the reaction of wanting to do away with the tax advantage.

We must take the time to think and look at how these things are determined to ensure that at the end of the day, the reaction is sensible and rational. Sometimes, the possibility of tax savings should be available, because it has positive impacts on the economy. But we must find ways to stop abuse from happening.

The Liberal motion also refers to the fact that the government's two measures are the cause of foreign takeovers. I do not think that a direct causal link can be made in this way, but the fact remains that we must address the phenomenon of foreign takeovers of Canadian and Quebec companies.

In Quebec, we are obviously now carefully assessing what the impact of Alcoa's takeover of Alcan would be. All the consequences of such a takeover must be reviewed, because based on the information I have seen, this transaction would mean that 37% of all of this new giant's aluminum production would come from Quebec.

Are there not in fact benefits to be gained from this kind of transaction? We must have a closer look at this and ensure that the existing legal mechanisms concerning foreign investment review are fully utilized. In that respect, we must ensure that our legislation is consistent with the new, current economic reality of globalization. Ultimately, when a transaction is being assessed for its relevance to the Canadian economy, important social factors must also be considered, such as the impact on employment in certain regions, for instance, and the repercussions of such a transaction on older workers. Not only will this serve to correct some purely economic aspects, but it will also take into account other types of impact we can expect to see.

This motion is a bit of a hodgepodge of a number of conditions. In my opinion, its current wording is a little outdated, considering our current reality. On one hand, with respect to interest deductibility, the minister announced that he will make a statement next Monday that will make his position clear. On the other hand, yesterday, the day before the debate on this motion, the Liberal finance critic himself suggested that an expert panel should examine this issue.

Perhaps we need to head more in this direction, in order to ensure that the Standing Committee on Finance, which is currently working on these issues, can complete its work, reach some conclusions and make some recommendations, especially since we can sense the government's desire to achieve some real results and outcomes. I thank the government for its support of the Bloc Québécois motion to study the issue of tax havens. This proves that they want to have a closer look at these issues. However, we must be prepared to study all situations. Certain aspects have to do with interest deductibility. There is also the matter of the treaty with Barbados, which, in my view, is a key factor.

I hope that the Standing Committee on Finance can produce a report on which there is as much agreement as possible, with recommendations that will have an impact as soon as possible. Maybe we can set as our deadline the fall economic statement or, at the latest, next year's budget. Clearly, if the work of the Standing Committee on Finance should result in a recommendation to abolish section 5907, which enables companies to bring $4 billion in profits from Barbados back to Canada without paying taxes, that would send a message to Canadians that their elected representatives have identified a fundamental inequity that must be corrected. I think that would be a key recommendation.

In my opinion, the committee should take a thorough look at interest deductibility. This week, we met with experts from the Canada Revenue Agency, who are very cautious about these and other issues.

It is not easy to get figures. The government needs to be more transparent.

The message that should be sent to people at the finance department or the revenue agency or to other government experts is that we need information in order to make the right recommendations.

We need to stop playing hide and seek with money, or else we will encourage the current perception that there can be inequity in the tax system, but it cannot be addressed because it is protected by people behind the scenes.

We have a wonderful opportunity to move forward and correct this situation in the Standing Committee on Finance. Personally, I hope that this will be the best way of ensuring that, at the end of the day, we can make recommendations to address these issues.

Regarding income trusts, Bill C-52 is already before us. The budget has been adopted and now must be implemented. What we must do is keep listening.

We have to listen to people who have suffered serious losses, those in a position to provide arguments on this issue. Maybe we should hold a debate in the fall, and, in a future budget, determine what is feasible. Nonetheless, we must always respect the principle of tax fairness and strive to make changes that will improve the situation, allow more fairness in taxation and take into account any potential impact on the economy.

We can learn from this motion and keep the following in mind. When the government makes announcements on economic investments—primarily in the budget and on other occasions—it should make sure that it has considered every possibility and not present half-baked initiatives. Otherwise, we are sending economic stakeholders a mixed message. That is what the government has to be aware of now in the matter of deductibility of interest expenses. There needs to be a clearer message.

Consider the example I gave on the GST rebate for tourists. Again, there is still some work to complete. Often it is not just a matter of small details, but things that have a major economic impact. These days, we must always consider the big picture in the context of globalization.

Like everyone else, the representatives of the multinationals in Canada—whose head office may be in the United States or elsewhere—are well aware of the conditions on investments. We should not have to kneel down to these companies. We should make sure the representatives from Quebec or Canada within these multinationals have what they need to get authority from their head offices in order to capitalize on factors that would attract the companies and create the right conditions to move forward.

We thought the Conservative government would have been particularly sensitive about the importance of these issues, but we are seeing the opposite and it is quite surprising. The government, which says it defends business interests, has introduced a number of initiatives that lack polish, that need fine tuning, especially on aspects that could have been planned or have already been studied. These initiatives could have been introduced and implemented in a very clear manner.

I am not saying that decisions can always be made that work for everyone. Sometimes we must make decisions even if some people will be penalized. However, in the end, the criteria to be considered are transparency and respect for what has been proposed. If ever there is a need to reverse a decision or way of doing things because a party, having come into power, realizes that it was mistaken, then a way must be found to penalize the fewest possible people.

Promises made during an election campaign—such as the one pertaining to income trusts—are in some ways moral commitments, contracts entered into with the voter. In this case, the Conservatives have broken this moral contract. Therefore, we are right to bring forward our proposals. However, the way in which the Liberal Party is proposing to move forward in this motion, today, is unacceptable. With regard to the proposed solutions, the motion does not reflect comments made about interest deductibility. With regard to income trusts, it is even worse, because the proposal does not resolve the basic issue of the need for tax equity.

Senate Appointment Consultations ActGovernment Orders

May 7th, 2007 / 3:30 p.m.
See context


Pierre Paquette Bloc Joliette, QC

Mr. Speaker, taking part in this debate on Bill C-43, is a little like going to the dentist. Personally, it is the last thing I want to be doing, but what can I say, sometimes we need to go to the dentist. However, we never need to go to the tooth puller.

I truly think the bill before us is of absolute no relevance. It addresses a very secondary matter to the detriment of more pressing priorities than the proposed reform, and that the Conservative government should be concerned about.

Bill C-43 provides for the consultation of electors in a province with respect to their preferences for the appointment of senators to represent the province.

Part 1 provides for the administration of a consultation, which is exercised under the general direction and supervision of the Chief Electoral Officer.

Part 2 provides for the holding of a consultation, initiated by an order of the governor in council.

Part 3 provides for a process whereby prospective nominees may confirm their nominations with the Chief Electoral Officer.

Part 4 addresses voting by electors in a consultation.

Part 5 sets out the rules for the counting of votes pursuant to a preferential system, which takes into account the first and subsequent preferences of electors as indicated on their ballots.

Parts 6 and 7 deal with communications and third party advertising in relation to consultations.

Part 8 addresses financial administration by nominees.

Part 9 provides for the enforcement of the enactment, including the establishment of offences and punishments for contraventions of certain provisions.

Part 10 contains transitional provisions, consequential amendments to the Canada Elections Act and the Income Tax Act, coordinating amendments and commencement provisions.

As I mentioned from the outset, the bill is irrelevant. First, it is quite clear to us that the government, the House of Commons, cannot unilaterally change the Senate without the Constitution being changed. Since the Constitution is a federal constitution, all the stakeholders, in other words, all the provinces, Quebec, the federal government, the parliaments of these different jurisdictions, have to take part in the reform process.

As I said at the beginning, we do not think this bill is appropriate because what we really need is something that includes a review of the Constitution. In the late 1970s, the Supreme Court of Canada studied Parliament's ability to unilaterally amend the constitutional provisions concerning the Senate and, in a 1980 decision concerning Parliament's jurisdiction over the upper chamber, decided Parliament could not unilaterally make decisions about major changes to the essential character of the Senate.

It is likely this legislation will encounter opposition from the provinces, including Quebec. Quebec is not the only province that does not support this government's approach in tabling this bill. The government is heading down a path that leads to the reform of an institution whose relevance is in doubt. Even so, the proposed reform is a minor one.

Do they seriously think that a constitutional negotiation process—which would be necessary, as I said—makes sense right now when the government and Parliament should focus their attention on far more important issues? Just consider reintegrating Quebec into the Constitution that Pierre Elliott Trudeau unilaterally patriated.

All of Quebec's governments, regardless of whether they were Liberal or Parti Québécois, have refused to sign the Constitution as it was patriated in the early 1980s. I would note that there is a three-party consensus on this in the National Assembly among the Liberal Party of Quebec, the Parti Québécois and the Action Démocratique du Québéc.

It is clear to us that neither the powers of the Senate, nor the senator selection method, nor the number of senators for each province, nor the residency requirements for senators can be changed without going through the usual amendment procedure set out in section 38 of the Constitution Act, 1982, which requires the consent of the Senate, the House of Commons, and the legislative assemblies of at least two thirds of the provinces, that is, seven provinces, making up at least 50% of Canada's population.

This is the famous 7/50 formula.

We can see that this bill is irrelevant and could even be harmful, setting in motion a round of constitutional negotiations on a relatively minor issue, as I said. On September 21, 2006, Quebec's intergovernmental affairs minister, Benoît Pelletier—who was recently reappointed—testified before the Special Senate Committee on Senate Reform, where he stated:

—from the Quebec government perspective, clearly any future transformation of the Senate into an elected chamber would be an issue that should be dealt with through constitutional negotiations and not simply through unilateral federal action.

He added:

If the Senate becomes a chamber of elected representatives, its original purpose would be changed. Whether this is achieved directly or indirectly, it becomes an extremely important change which must be debated within the framework of constitutional discussions.

So as I mentioned, Quebec's intergovernmental affairs minister, Benoît Pelletier, simply reiterated Quebec's traditional position to the senate committee by saying two things: first, that the federal government cannot reform the Senate unilaterally, and second, that the federal government cannot achieve indirectly what it cannot achieve directly. Clearly, introducing this bill is a way of doing indirectly what the government does not want to do directly.

As I said earlier, Quebec is not alone in its opposition to electing senators. The premiers of Saskatchewan and Manitoba have called on the government to abolish the Senate instead of trying to reform it. Even the premier of Ontario has expressed serious doubts, saying that electing senators would exacerbate inequalities, under the Senate's current mandate.

Electing senators indirectly would change the relationship between the House of Commons and the Senate and create confusion. I will come back to this. These changes cannot be made unilaterally without the consent of Quebec and the provinces, as Quebec is now recognized as a nation by the House of Commons. Everyone will appreciate that such a reform would be most unwelcome and would not be in keeping with the spirit of either the Constitution or what has been passed in this House.

I said that the first reason this bill is irrelevant is that it will inevitably lead to a round of constitutional negotiations, which do not make a great deal of sense, whether they concern the Senate or just the election of senators. Therefore, once again, if the government goes ahead, it will come up against this constitutional problem.

The second thing that, to me, makes this bill irrelevant, is that, even reformed by Bill C-43, the Senate is still an useless institution. Originally, the Senate was supposed to be a chamber of sober second thought. It was also supposed to protect regional interests. But when we look at the current makeup of the Senate, we see that the appointments were clearly partisan, which has distorted the nature or mandate of the Senate.

Introducing the election of senators will not resolve the issue, because senators will sooner or later have to affiliate themselves with a political party in order to have the necessary resources for the elections. So the Senate will become more partisan and we will depart even further from its original purpose, which, in my opinion, is no longer relevant in the 21st century.

As I was saying, the indirect election of senators would not improve this situation. On the contrary, the electoral process will tend to increase the role of political parties and indirectly elected senators could become concerned with things that now fall under the authority of the House of Commons. This would create a duplication, or, at the very least, confusion, at a cost of $77 million a year. We think this is an extremely high cost for an institution that is not only useless, but that , in the case of the proposed reform, would create confusion and a significant duplication of legitimacy.

It is important to note that because of the evolution of the democratic process in Canada, in the provinces and in Quebec, no province has had an upper house since 1968.

It is interesting to note that members of several provincial upper houses—unlike the Senate of Canada—once had to earn their election, for example, Prince Edward Island. Such upper houses have disappeared over the years, however. Quebec abolished its legislative council in 1968. That was nearly 40 years ago.

Furthermore, I feel it is important to point out another factor. Bill