Bill C-15 (Historical)

Budget Implementation Act, 2016, No. 1.

An Act to implement certain provisions of the budget tabled in Parliament on March 22, 2016 and other measures

Part 1 implements certain income tax measures proposed in the March 22, 2016 budget by
(a) eliminating the education tax credit;
(b) eliminating the textbook tax credit;
(c) exempting from taxable income amounts received as rate assistance under the Ontario Electricity Support Program;
(d) maintaining the small business tax rate at 10.‍5% for the 2016 and subsequent taxation years and making consequential adjustments to the dividend gross-up factor and dividend tax credit;
(e) increasing the maximum deduction available under the northern residents deduction;
(f) eliminating the children’s arts tax credit;
(g) eliminating the family tax cut credit;
(h) replacing the Canada child tax benefit and universal child care benefit with the new Canada child benefit;
(i) eliminating the child fitness tax credit;
(j) introducing the school supplies tax credit;
(k) extending, for one year, the mineral exploration tax credit for flow-through share investors;
(l) restoring the labour-sponsored venture capital corporations tax credit for purchases of shares of provincially registered labour-sponsored venture capital corporations for the 2016 and subsequent taxation years; and
(m) introducing changes consequential to the introduction of the new 33% individual tax rate.
Part 1 implements other income tax measures confirmed in the March 22, 2016 budget by
(a) amending the anti-avoidance rules in the Income Tax Act that prevent the conversion of capital gains into tax-deductible intercorporate dividends;
(b) qualifying certain costs associated with undertaking environmental studies and community consultations as Canadian exploration expenses;
(c) ensuring that profits from the insurance of Canadian risks remain taxable in Canada;
(d) ensuring that the dividend rental arrangement rules under the Income Tax Act apply where there is a synthetic equity arrangement;
(e) providing specific tax rules in respect of the commercialization of the Canadian Wheat Board, including a tax deferral for eligible farmers;
(f) permitting registered charities and registered Canadian amateur athletic associations to hold limited partnership interests;
(g) providing an exemption to the withholding tax requirements for payments by qualifying non-resident employers to qualifying non-resident employees;
(h) limiting the circumstances in which the repeated failure to report income penalty will apply;
(i) permitting the sharing of taxpayer information within the Canada Revenue Agency to facilitate the collection of certain non-tax debts; and
(j) permitting the sharing of taxpayer information with the Office of the Chief Actuary.
Part 2 implements certain goods and services tax/harmonized sales tax (GST/HST) measures proposed in the March 22, 2016 budget by
(a) adding insulin pens, insulin pen needles and intermittent urinary catheters to the list of GST/HST zero-rated medical and assistive devices;
(b) clarifying that GST/HST generally applies to supplies of purely cosmetic procedures provided by all suppliers, including registered charities;
(c) relieving tax to ensure that when a charity makes a taxable supply of property or services in exchange for a donation and an income tax receipt may be issued for a portion of the donation, only the value of the property or services supplied is subject to GST/HST;
(d) ensuring that interest earned in respect of certain deposits is not included in determining whether a person is considered to be a financial institution for GST/HST purposes; and
(e) clarifying the treatment of imported reinsurance services under the GST/HST imported supply rules for financial institutions.
Part 2 also implements other GST/HST measures confirmed in the March 22, 2016 budget by
(a) adding feminine hygiene products to the list of GST/HST zero-rated products; and
(b) permitting the sharing of taxpayer information in respect of non-tax debts within the Canada Revenue Agency under certain federal and provincial government programs and in respect of certain programs where information sharing is currently permitted under the Income Tax Act.
Part 3 implements certain excise measures proposed in the March 22, 2016 budget by
(a) ensuring that excise tax relief for diesel fuel used as heating oil or to generate electricity is targeted to specific instances; and
(b) enhancing certain security and collection provisions in the Excise Act, 2001.
Part 3 also implements other excise measures confirmed in the March 22, 2016 budget by permitting the sharing of taxpayer information in respect of non-tax debts within the Canada Revenue Agency under certain federal and provincial government programs and in respect of certain programs where information sharing is currently permitted under the Income Tax Act.
Division 1 of Part 4 repeals the Federal Balanced Budget Act.
Division 2 of Part 4 amends the Canadian Forces Members and Veterans Re-establishment and Compensation Act to, among other things,
(a) replace “permanent impairment allowance” with “career impact allowance”;
(b) replace “totally and permanently incapacitated” with “diminished earning capacity”;
(c) increase the percentage in the formula used to calculate the earnings loss benefit;
(d) specify when a disability award becomes payable and clarify the formula used to calculate the amount of a disability award;
(e) increase the amounts of a disability award; and
(f) increase the amount of a death benefit.
In addition, it contains transitional provisions that provide, among other things, that the Minister of Veterans Affairs must pay, to a person who received a disability award or a death benefit under that Act before April 1, 2017, an amount that represents the increase in the amount of the disability award or the death benefit, as the case may be. It also makes consequential amendments to the Children of Deceased Veterans Education Assistance Act, the Pension Act and the Income Tax Act.
Division 3 of Part 4 amends the sunset provisions of certain Acts governing federal financial institutions to extend by two years, namely, from March 29, 2017 to March 29, 2019, the period during which those institutions may carry on business.
Division 4 of Part 4 amends the Bank Act to facilitate the continuance of local cooperative credit societies as federal credit unions by granting the Minister of Finance the authority to provide transitional procedural exemptions, as well as a loan guarantee.
Division 5 of Part 4 amends the Canada Deposit Insurance Corporation Act to, among other things, broaden the Corporation’s powers to temporarily control or own a domestic systemically important bank and to convert certain shares and liabilities of such a bank into common shares.
It also amends the Bank Act to allow the designation of domestic systemically important banks by the Superintendent of Financial Institutions and to require such banks to maintain a minimum capacity to absorb losses.
Lastly, it makes consequential amendments to the Financial Administration Act, the Winding-up and Restructuring Act and the Payment Clearing and Settlement Act.
Division 6 of Part 4 amends the Office of the Superintendent of Financial Institutions Act to change the membership of the committee established under that Act so that the Chairperson of the Canada Deposit Insurance Corporation is replaced by that Corporation’s Chief Executive Officer. It also amends several Acts to replace references to that Chairperson with references to that Chief Executive Officer.
Division 7 of Part 4 amends the Federal-Provincial Fiscal Arrangements Act to authorize an additional payment to be made to a territory, in order to take into account the amount of the territorial formula financing payment that would have been paid to that territory for the fiscal year beginning on April 1, 2016, if that amount had been determined using the recalculated amount determined to be the gross expenditure base for that fiscal year.
Division 8 of Part 4 amends the Financial Administration Act to restrict the circumstances in which the Governor in Council may authorize the borrowing of money without legislative approval.
Division 9 of Part 4 amends the Old Age Security Act to increase the single rate of the guaranteed income supplement for the lowest-income pensioners by up to $947 annually and to repeal section 2.‍2 of that Act, which increases the age of eligibility to receive a benefit.
Division 10 of Part 4 amends the Special Import Measures Act to provide that a finding by the President of the Canada Border Services Agency of an insignificant margin of dumping or an insignificant amount of subsidy in respect of goods imported into Canada will no longer result in the termination of a trade remedy investigation prior to the President’s preliminary determination. It also provides that expiry reviews may be initiated from a date that is closer to the expiry date of an anti-dumping or countervailing measure and makes amendments related to that new time period.
Division 11 of Part 4 amends the Pension Benefits Standards Act, 1985 to combine the authorities for bilateral agreements and multilateral agreements into one authority for federal-provincial agreements, and to clarify that federal-provincial agreements may permit the application of provincial legislation with respect to a pension plan.
Division 12 of Part 4 amends the Employment Insurance Act to, among other things,
(a) increase, until July 8, 2017, the maximum number of weeks for which benefits may be paid to certain claimants in certain regions;
(b) eliminate the category of claimants who are new entrants and re-entrants; and
(c) reduce to one week the length of the waiting period during which claimants are not entitled to benefits.
Division 13 of Part 4 amends the Canada Marine Act to allow the Minister of Canadian Heritage to make payments to Canada Place Corporation for certain celebrations.
Division 14 of Part 4 amends the Jobs, Growth and Long-term Prosperity Act to authorize the Minister of Infrastructure, Communities and Intergovernmental Affairs to acquire the shares of PPP Canada Inc. on behalf of Her Majesty in right of Canada. It also sets out that the appropriate Minister, as defined in the Financial Administration Act, holds those shares and authorizes that appropriate Minister to conduct, with the Governor in Council’s approval, certain transactions relating to PPP Canada Inc. Finally, it authorizes PPP Canada Inc. and its wholly-owned subsidiaries to sell, with the Governor in Council’s approval, their assets in certain circumstances.
Division 15 of Part 4 amends the Canada Foundation for Sustainable Development Technology Act to modify the process that leads to the Governor in Council’s appointment of persons to the board of directors of the Canada Foundation for Sustainable Development Technology by eliminating the role of the Minister of Natural Resources and the Minister of the Environment as well as the consultative role of the Minister of Industry from that process. It also amends the Budget Implementation Act, 2007 to provide that a sum may be paid out of the Consolidated Revenue Fund to the Foundation on the requisition of the Minister of Industry and to clarify the maximum amount of that sum.

Budget Implementation Act, 2016, No. 1

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Mr. Speaker, what I will say is that we have made a large commitment to post-secondary institutions. We have made a commitment to individuals who are enrolling at post-secondary institutions. If we look at the Canada student loan grants and debt repayment schedules that we have put in place in the budget in Bill C-15, we see literally a multi-billion dollar investment into our universities, and our students per se, so that when students exit university and begin working they will have a time frame to accumulate some capital before they need to repay their student loans. Therefore, on the one hand we are helping in terms of investing in infrastructure in universities and on the other hand we are also helping with students enrolling in universities, particularly middle and low-income students who need that assistance when going to university so that they are not burdened by such a high debt burden when they exit university.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Mr. Speaker, I would like to thank the member for Vaughan—Woodbridge for his interventions so far. I do a lot of work with him on the Kurdish file. Therefore, I know that he is learned and studies up on issues like this. However, I cannot believe that he would support a budget that will spend over $100 billion. In this budget alone it will be $29.6 billion, 80% of which is just program spending. It is just spending on programs. That will be passed on to the next generation. This is telling them that they will have to pay the bill for the wants of today, not the needs of today. How can he support such a bad budget where the vast majority of the spending is not spent on infrastructure or assets, rather it is bad program spending? How can he answer that? How can he support this budget?

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Mr. Speaker, my colleague and I do some good work on the Kurdish file, and I am pleased to work with him on that.

What I will say is that I defer to what others have commented about infrastructure investments, whether it is the former federal reserve chairman Ben Bernanke or the current Bank of Canada governor Stephen Poloz, which is that key investments in infrastructure, which is what this budget undertakes, are an enabler for long-term growth and maintain our standard of living. Therefore, our budget, part and parcel of which represents our platform, and Bill C-15, which is the blueprint, is one of the large first measures to implement our infrastructure program, which will help grow our economy and strengthen our middle class.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Mr. Speaker, I appreciate the opportunity to join this important debate on the government's budgetary policy. I will be focusing my remarks on certain areas that I have not had a chance to discuss yet in previous speeches on the government's budgetary policy.

There is an evidence sense of unreality to the discussion coming from government members on this. We hear a lot about what the budget aims to do. The budget aims to do this and it aims to do that. Our complaint is not with the intentions of the budget. Our complaint is with the provisions in the budget. There are many cases in which there is this obvious dissonance between high-minded claims about what the budget aims to do and the substance of the provision. We just heard a good example of that. A member talked about small business in his riding and the important work it did, but then supported a budget that would raise taxes on small business and eliminate the hiring credit for small business. There is this evident dissonance here.

I had an opportunity to question the finance minister in committee of the whole last week. I asked three times, consecutively, if he believed that the government should eventually balance the budget at some point in the future. We did not get an answer to that question.

When the finance minister, who should know better, cannot even answer a direct question about whether it is important for a country to balance its budget at some point in the future, then we have a real problem with the seriousness of the plan. It is not a problem with intentions necessarily, but it is a problem with the seriousness of this so-called fiscal plan.

I want to talk about three specific things today. I want to talk about where economic growth really comes from. I want to talk about the impact of the budget on families. I want to speak about the impact of the budget on indigenous Canadians, specifically in the context of indigenous education.

We hear a lot about economic growth, and this comes back to the good intentions here. We hear the word “growth” used over and over again. Like so many of the words the government uses, especially in the context of budgetary policy, we have not ever heard it clearly defined. We do not hear the Liberals explain what they mean by growth and what exactly they plan to achieving in growth.

Economic growth is produced when there is an increase in the ability of society to provide for itself, when society grows in its economic means to provide for itself in terms of its wants and its need. Therefore, it is very closely linked to the concept of economic productivity, productivity being the rate of output given the input.

We often talk for example about labour productivity. As labour productivity increases, the amount of output that can be produced in a given hour of labour increases. That is really what creates economic growth. Economic growth is about finding ways of more productively using our time and our resources to produce more things that we can use to satisfy our wants and our needs. Fundamentally, foundationally it is about growth in productivity.

When the government thinks about trying to encourage economic growth, it should focus on productivity. The current government talks as if all that is required to increase growth is more government spending. Looking around the world, it is easy to see how there is no linear relationship at all between government spending and economic growth. Some countries do much better than others that have much lower levels of public spending. That is not to say the government does not have a role in identifying areas where productivity growth can occur, but it certainly is not in any sense linear.

From my perspective, there are a number of different things that facilitate increases in productivity, which is important for economic growth. One would be a more educated workforce, specifically though a workforce equipped with job-ready skills, and a marketplace that is well-equipped to commercialize knowledge that is produced.

That was why in 2007 our government came forward with a science and technology strategy that looked at ways of more effectively encouraging commercialization of knowledge. It was why we put an emphasis on encouraging the trades as well, because of the needed to have a workforce that was equipped with job-ready skills. That was important for productivity and economic growth.

Efficient transportation infrastructure is obviously an important part of that as well, both in education and infrastructure. These are areas where government spending can play a positive role. What is disappointing about the budget is the total abuse of the word “infrastructure”. The government redefines infrastructure to mean almost everything.

The minister confirmed in our discussion in committee of the whole that he believed child care was a form of infrastructure. Well, it is certainly not in the sense that economists traditionally define it. Transportation infrastructure obviously has a positive impact on productivity when it is well placed, well designed, and when it helps people get to and from work more quickly.

Productivity growth requires an economic system that provides significant returns on business innovation. Business innovation creates improvements in productivity, and therefore we need a system that creates incentives for that business innovation, things like relatively low business tax rates and benefits accruing to companies that choose to hire more people. That is why this budget would negatively impact productivity by effectively increasing the tax on small business by eliminating the hiring credit. These types of measures are not good for economic growth.

Economic growth requires a stable and predictable economic environment as well. People will invest in an economy that they have a reasonable expectation will do well over the long term. When we have extended periods of large budget deficits and we have the government going into deficit with no plan to get out of it when we are not in the midst of a recession, that clearly damages confidence and reduces the reason for investments in things that produce productivity growth.

We hear a lot about growth from the government, but we do not actually hear any discussion of those foundational constituent parts of growth, things like how we increase the productivity of our economy and how we increase the productivity of labour. These are things that the government should be thinking about in a more serious way, but the Liberals repeat this mantra that more government spending is somehow, absent of any clear connection or specificity in investment, going to lead to economic growth. That is a major concern I have with the plan of the Liberals.

I want to speak as well about the impact of the budget on families.

I believe in a simple principle with regard to family taxation. If two families are earning the same amount of money, then they should pay the same amount of tax. It would seem arbitrary and unreasonable, and therefore unfair, that we would have two families each earning the same family income but happen to pay different amounts of tax, simply by virtue of which people in the family are earning the income. That is why we brought in income splitting. It was an important tax cut, but it was also a measure to ensure tax fairness.

However, the government does not seem to agree with this principle of tax fairness. The Liberals would eliminate income splitting, having the effect of raising taxes on many families, but also now ensuring a system of unequal taxation where we have families that are earning the same income, yet paying different amounts of taxes, simply because of how they decide to divide child care responsibilities. Our view has always been that it should be up to families to make their own child care choices, and families should not face some kind of direct or indirect fiscal penalty because of the financial choices they make.

Of course, the Liberal changes would also remove universality of child care benefits. We think that is a problem. We think a universal taxable benefit made good sense. Of course, a taxable benefit is inherently more progressive because the more money one makes, the more tax one pays on it. It had that built-in progressivity to it, but it was still designed to ensure that everyone had something to benefit from.

I want to speak briefly about the impact of the budget on indigenous Canadians. This budget would spend a significant amount of new money, but it does not come with the kinds of measures that are necessary to ensure the success of those investments, especially as it pertains to education.

We have a core problem when it comes to education in aboriginal communities. Unlike in every province across the country, on-reserve first nations education does not have legislated educational standards and a legislated mandate for core curriculum. It does not require that schools award a recognized provincial diploma. That is a problem. It is a problem when we do not have those structures in place to ensure that there can be a seamless transition between a school on a reserve and a school off a reserve. These are the kinds of measures, the kind of collaborative structuring of the system, improvements to accountability, that would make a real concrete different. We think those kinds of changes should, and could, be accompanied by increased investment. However, the government has put in new money but does not actually have an effective plan to improve the system at all.

Those are a number of reasons, and there are many more I could list, why I am very concerned about this budget, and I will be opposing it.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Mr. Speaker, I took some pleasure in listening to what I call the hon. member's litany of unfounded grievances with the budget. However, I have a specific question for my friend.

He no doubt is aware that the former finance minister of the previous government, the late Jim Flaherty, was adamantly opposed to income splitting. Part of the foundation for that opposition was that a consequence of income splitting would show an inordinate amount of women staying at home and not entering or staying in the workplace. Is that the policy the member wants to see achieved by having a robust income splitting regime?

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Mr. Speaker, I think to some extent the member would put words in the former finance minister's mouth, although to the extent that we may disagree on aspects of this.

On the question of people staying home or not, the tax system should be neutral with respect to the choices people make about child care. I do not think it should penalize people who make one kind of child care choice over another. Some parents may decide that a certain kind of child care arrangement is better for their family, whether that is a person at home, be it mom or dad; whether that is grandparents; whether that is institutional child care; or whether that is some kind of child care sharing arrangement with neighbours or friends.

What I see in my community is actually the increasing flexibility and variability of child care relationships. We increasingly see people working from home, and working different hours. We are not in that sort of narrow nine-to-five model for many people. Increasingly there is flexibility there. There is a lot of change and variability in child care.

From a state perspective, we should not go to families and say that we think this is what we want them to do with respect to child care. We should leave the decisions to the people who we think are the most important child care experts, mom and dad.

[Erin Weir, NDP, Regina—Lewvan, SK]

Mr. Speaker, the hon. member for Sherwood Park—Fort Saskatchewan is a fellow alumnus of the Canadian University Society for Intercollegiate Debate, and he clearly understands the importance of defining his terms. I note that he began by defining economic growth in terms of the economy's capacity to produce output. Of course, by that definition, we can only look at the supply side, and productivity is the only factor that matters to economic growth.

We are all in support of more productivity, but I wonder if the House would accept that economic growth is actually about the total amount of output, which depends not only on productive capacity, but also on the demand for output. I wonder if the member for Sherwood Park—Fort Saskatchewan would acknowledge that in the current context of unemployed workers and unemployed resources, it is actually possible to increase economic growth by increasing demand through measures such as government spending.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

This is probably a debate that would take more than the time you would allow me, Mr. Speaker, to engage in great depth.

Probably the easiest way to answer that is as much as there are some good arguments for fiscal stimulus in certain contexts where there is sort of a brief aberration in terms of levels of demand, in the long term it will be an increase in productivity that sustains economic growth over a long period. I think Keynes would agree with that, as well as a range of economists across the spectrum.

The problem I have with the government's budgetary policy is not that it supports fiscal stimulus in unique times of recession, but that it seems to believe that we can perpetually run deficits. I think every serious economist would agree that we cannot be constantly running deficits to stimulate the economy. The very basis of Keynesianism is that we run deficits at certain times and surpluses at other times, not that we have a constant situation in which spending exceeds what the government is taking in. Obviously, that would lead us to a debt crisis, and then we are in a situation where we cannot stimulate our way out of it, because we have run out of other people's money.

[Salma Zahid, Liberal, Scarborough Centre, ON]

Mr. Speaker, it is finally time for hard-working Canadians from coast to coast to coast to get a helping hand from their government.

Middle-class Canadians have been ignored for too long. Today is a day of change and hope. That is why I rise to speak in favour of Bill C-15, Budget Implementation Act, 2016, No. 1.

When I participated previously in the budget debate, I recognized and applauded the government's work towards helping middle-class families through the Canada child benefit program, reducing poverty, strategies to reduce youth unemployment, and investing in infrastructure and seniors.

However, there are many other initiatives of this budget that I would like to speak about today. I believe they pertain not only to Canadians across the country, but also to the many tireless and hard-working residents of my riding of Scarborough Centre.

As I have said before, my riding of Scarborough Centre is an extremely diverse community, comprised of Canadians hailing from across the globe. They are all here to work hard and provide lives for themselves and their children. We are not afraid of putting in long hours every day in Scarborough. However, for far too long, the costs of living for families, for things such as groceries and rent to other necessities, has continued to rise while paycheques have stayed the same.

At the same time, I always hear that youth are the future of a great Canada. While I do agree, I see the daily struggles that so many youth face, especially as they attempt to enter the job market and start giving back to society and their communities.

While we must assist youth all across the country in solidifying their future, we must also not forget about the many veterans in our communities. These are citizens who have gone above and beyond and provided the highest and most honourable forms of service to our country. Hence, these Canadian heroes must be provided with the resources and assistance they need in due recognition for their sacrifices.

We must also recognize the social, economic, and other invaluable contributions that small businesses provide to our society. Small businesses are the engine of our economy. I would like to bring attention to the issues affecting small business owners and the many dedicated Canadians that they employ. The effects of struggling small businesses are not contained to the owners and their employers. The ripples impact millions of Canadians. It should be of the utmost importance to ensure their prosperity.

Also, with a challenging economy, many Canadians are in need of a helping hand with regard to employment insurance. Budget 2016 addresses that.

Middle-class families, youth, veterans, small businesses, and Canadians suffering unemployment have all been subject to unhelpful and sometimes even hurtful policies by the previous government. However, our government has promised change. I can proudly attest that with this budget, we are delivering on these promises for a better society, a better economy, and a better Canada.

The lack of affordable housing poses a great risk to millions of Canadians. As the budget itself states, when affordable housing is in short supply, Canada's whole economy suffers, from raising healthy children to pursuing education, jobs, and other opportunities. Affordable housing is the cornerstone of a strong Canadian family, and therefore of a strong Canada.

This is especially true in my riding of Scarborough Centre, where almost half of tenants spend more than 30% of their monthly household income on housing compared to the national average of less than one in five. Even more, the number of residents in subsidized housing is disproportionately higher in my riding. When it comes to quality of housing, almost one in five dwellings in Scarborough Centre is defined as unsuitable by the national household survey, compared to the about one in 20 nationally.

The need for action on affordable housing is clear, and this government is taking action. Budget 2016 proposes an investment of $2.3 billion over the next two years in affordable housing, with $739 million of that directed to first nations, Inuit, and northern housing. Additionally, a significant portion of this funding will be allocated provincially and territorially to ensure that resources are invested in the most pertinent needs. Much of this investment will be focused on green, clean, and sustainable economic growth.

Moving on, to support young Canadians in gaining the education and skills needed to compete in the economy of tomorrow, the budget proposes infrastructure investments through the Canada Foundation for Innovation. This program will support significant investments in research infrastructure at universities, colleges, and research hospitals nationwide, such as the University of Toronto in Scarborough and Centennial College, both institutions that many of my constituents attend. This will refresh and renew the current 25-year-old infrastructure and ensure that our nation continues to train, educate, and produce the brightest future leaders in the world.

In addition, budget 2016 would implement programs such as the educator school supply tax credit to help teachers and educators make ends meet in classrooms. As well, flat-rate student contributions will make it easier for post-secondary students to work and earn money without worrying about negative impacts on their financial aid eligibility. Initiatives such as these will ensure that Canada can attract young talent while boosting innovation and contributing to constructing a sustainable economy.

Our government is not forgetting about the countless veterans who have already made such a vital impact and contribution to Canada. Canada's veterans and their families deserve our care, compassion, and respect. With that in mind, budget 2016 is committed to reopening the staff service offices across the country that were closed by the previous government, and expanding veteran outreach services to regions that currently lack them.

Moreover, I strongly commend budget 2016 for increasing the maximum disability award for veterans to $360,000, and also increasing the earnings loss benefit to 90% of pre-release military salary. These policies, among several other implementations in this budget, clearly exemplify our government's commitment to each and every Canadian, especially veterans who have served the highest duties.

This budget also addresses the concerns of the millions of Canadians whose livelihoods depend on small businesses. With this budget, the government has introduced a lower small business income tax rate of 10.5% on the first $500,000 of active business income, allowing these hard-working businesses to retain more earnings that can be reinvested to support growth and job creation.

For those who are trying to re-enter the job market, I would also like to recognize the government's initiative of significantly increasing accessibility to employment insurance for thousands of Canadians through eligibility amendments. Not only that, but this budget will bring about a 50% reduction in waiting periods for unemployed Canadians who are in need of a helping hand to get back on their feet.

I must also mention that the government has been swift in its response to unforeseen and sharp rises in unemployment in certain regions by extending EI benefits in 12 regions across the country. Unlike the previous government, we are delivering on our promises. Budget 2016 is a testament to the delivery of these commitments.

As I have said before, there is much more to be done in the years ahead, but with budget 2016, our government has laid the foundation for future growth and prosperity. With this budget, we are investing in Canada's future, and today that future is extremely bright indeed.

[John Brassard, Conservative, Barrie—Innisfil, ON]

Mr. Speaker, one thing we are seeing with the Liberal budget, obviously, is increased deficit spending. We are looking at multi-billions of dollars in deficits that are going to be created, and an increase to the debt as well.

Recently, on a trip to Washington, I had the opportunity to listen to some of the top economists in the country. They were talking about the potential for a recession. It is not just a matter of if a recession is going to happen, it is a matter of when. We are currently in the sixth year of what are typically five-year cycles of recession. When a government spends as much as what the Liberals are proposing to spend, it leaves very little wiggle room with respect to getting out of a recession, as we did in 2008.

I would like to ask the hon. member this. If a recession were to hit, what measures would her government take in order to make sure that Canada recovers from that recession?

[Salma Zahid, Liberal, Scarborough Centre, ON]

Mr. Speaker, right now Canada is going through an infrastructure debt. We cannot pass that debt on to our future generations. It is time to invest now, not tomorrow, but today. The interest rates are low and we need to invest in our economy. That is exactly what we are doing through our budget 2016. We are investing in our middle class by giving tax breaks, introducing the Canada child benefit. This will lead to growing the economy, and all Canadians will benefit from that.

[Erin Weir, NDP, Regina—Lewvan, SK]

Mr. Speaker, I fear that the member for Scarborough Centre's speaking notes may be out of date. She mentioned that the budget would extend employment insurance benefits in 12 regions. Since then, under pressure from the NDP, the Prime Minister has added three more regions to that benefit extension. We are now up to 15. In spite of that, Regina continues to be excluded from this extension of EI benefits.

To put that in context, there are eight EI regions across Alberta and Saskatchewan. At this point, seven of them are included in the benefit extension and only Regina is left out.

I wonder if the member for Scarborough Centre could shed any light on that decision and the rationale for leaving out Regina.

[Salma Zahid, Liberal, Scarborough Centre, ON]

Mr. Speaker, the member is right. In the budget, the government promised to monitor the economic situation after the budget, and, as a result, three other regions have been added. This is an evidence-based process, based on the data available. We will review the numbers, and wherever the help is needed, it will be extended.

[Adam Vaughan, Liberal, Parliamentary Secretary to the Prime Minister (Intergovernmental Affairs)]

Mr. Speaker, I listened to the previous questions with great interest because it was not pressure from any political party; it is a formula that includes jurisdictions. It is not political pressure. It is not favouritism. It is evidence-based decision-making. I am glad that my colleague across the way knew that.

However, it was the first question that caught my attention and the infrastructure deficit. There was underspending by the previous government. There were zero infrastructure dollars in Alberta. Not a single new dollar from the new building Canada fund was spent in Alberta in the last two years. That money could have been putting people to work in Alberta. Instead, it sat in bank accounts in Ottawa, even though the billboards went up in that beautiful province.

However, this is the issue. The $440-billion infrastructure deficit in this country has driven into places like Toronto, our home city, a $2.6-billion backlog in infrastructure repairs for Toronto Community Housing.

How will this budget address the deficit, both the fiscal and the infrastructure deficit, left to us by the previous government, a deplorable state of economic affairs, but even worse when it comes to measuring infrastructure impact?

[Salma Zahid, Liberal, Scarborough Centre, ON]

Mr. Speaker, I totally agree with my hon. colleague. I represent the riding of Scarborough Centre, which faces infrastructure debt for transit and affordable housing. It is not only an economic issue, but it is a social issue. Families cannot get back home in time to sit down and help their kids, or help their parents and look after them, because a lot of time is spent in Toronto on the roads.

Budget 2016's investment in transit and affordable housing will build on that, and people in my riding will definitely benefit from the investments in infrastructure as well as in affordable housing.