I should like to begin with a bit of background on the organization. The B.C. Chamber of Commerce represents 130 local chambers of commerce and boards of trade, encompassing 31,000 businesses of every size, sector and region within the province. We are the widest and broadest-based business organization in British Columbia.
In answer to the four questions now before us, we have four areas of focus we'd like to touch on: the need for enhancing the labour force, taxation, investment in transportation infrastructure, and fiscal policy.
As a framework, it's worth mentioning that Canada is facing some significant economic challenges. The slowdown in the U.S. and the impact it will have on our economy is still to be seen. The value of the Canadian dollar, global competitive pressures, ongoing trade issues with the U.S.—all these make the case for fiscal prudence in budget preparations. In our submission, we focused on productivity and competitiveness as the key watchwords for budget 2007.
The fact that we're experiencing a skills shortage across Canada is a widely accepted reality. What is perhaps not so well acknowledged is that this issue is now being significantly exacerbated by a coming demographic time bomb. In short, we're facing a perfect storm of a labour shortage feeding an existing skills shortage.
For this reason, while we largely agree with the C.D. Howe Institute that increased immigration is not a panacea, we believe it is the single most proactive tool in the hands of the federal government. We have a number of recommendations about how the immigration system can be improved. But for the purposes of the budget, we'd like to focus on two areas: the need to allocate resources to officers overseas to enhance their ability to process immigration applications more efficiently, and the need for a structure and the timeframe for the creation of a national centre for foreign credential recognition. We realize that budget money has already been put aside for this, but we need to time the issue to move this forward.
With respect to taxation in recent years, we commend both the Liberal and the current governments for their measures on reducing personal and corporate income tax rates, and for the measures taken to eliminate capital taxes and the corporate surtax. However...[Technical difficulty--Editor]...much still needs to be done.
We recommend that the federal government allocate most of the planning surplus to tax reduction to make Canada more competitive internationally and, within this framework, focus on reducing personal income tax rates across all tax brackets—but particularly for low- and modest-income families, who face the highest margin rates of all as a result of clawbacks of multiple benefits. We also ask that, where fiscal conditions permit, the government move forward all of the already-announced tax measures that are coming through up to 2010 as quickly and expeditiously as possible.
We would also ask the government to look at developing, in cooperation with provincial, territorial, and municipal governments, an index of overall tax burden. This would be an easy way for both the taxpayer and the government to measure and chart the overall tax burden on Canadians, with a view to making the taxation system more competitive.
Transportation infrastructure is a significant issue for British Columbia. As the gateway to Asia-Pacific, much of Canada's future economic prosperity will depend on how well we are able to enhance Asia-Pacific opportunities. Indeed, Canada's social and economic development has always been achieved in tandem with its transportation system. This will continue to be true, but future development will focus on the dominant economic opportunity of the 21st century, which is the Asia-Pacific.
With this in mind, we would recommend that the federal government work with the provinces and territories to develop a visionary transportation statement for Canada that links all modes and includes the Pacific Gateway strategy as one of its pillars.
With regard to ports, air, and road, we have generally applauded the federal government's partnership role with the province in the effort to enhance our transportation infrastructure. We would like to touch on three areas in which the only department not at the table is the federal government.
The first is the development of a common break bulk terminal facility in Kitimat. Break bulk is a significant growth opportunity, but all our efforts so far have been directed at containers. The second area is South Fraser Perimeter Road. The last is the enhancement of a new siting on the Colebrook to allow a second train to go from north to south.
In respect of fiscal policy, we strongly commend the federal government for the action taken recently with the release of the annual financial reports. This is the first time in nine years that we have seen a reduction in public spending. The commitment of $13.2 billion to the debt is something that the chamber wholly recommends. We think the fact that the federal government is in the ninth consecutive year without recording a surplus indicates that there is overtaxation at the federal level. The tax cuts that we have announced will help to address this.
We think that with respect to fiscal capacity governments should restrict themselves to fiscal spending increases of no more than 3% a year to keep in line with growth in the economy and in the population.
There are further recommendations in our submission, but we thank you for allowing us this time.