Bill C-52 (Historical)

Budget Implementation Act, 2007

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

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

Third Reading

[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.

[Lynne Yelich, Conservative, Parliamentary 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.

[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.

[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.

[Lynne Yelich, Conservative, Parliamentary 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.

[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.

[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 Motion

[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?

[Tom Lukiwski, Conservative, Parliamentary 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--

[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.

[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.

[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.

[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.

[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.