Thank you, Chair.
It's good to be here with the finance committee and the members of the committee. This is a hard-working committee, of course, particularly with respect to budget preparation, and I thank all of you for that.
I'm always short, but I'll also try to be brief in my opening remarks.
Your work pre-budget and the report you wrote were an important part of the presentation of the budget this year, as it is most years. Your recommendations do inform the budget, and I include from the committee's report—because I looked to see—some of the things that ended up in the economic action plan of 2013, including establishing a long-term plan for infrastructure, reviewing the temporary foreign worker program, extending the mineral exploration tax credit, reviewing current tariffs on consumer goods, ensuring fairness and neutrality in the tax system by closing tax loopholes, and further strengthening Canada's manufacturing sector.
Secondly, I'd like to congratulate the committee on its recent study and its in-depth report on options intended to increase charitable donations in Canada by using tax incentives and other targeted initiatives. The recommendations in this report also greatly influenced the preparation of the 2013 budget.
I will continue, but I will not say all the things I was going to say because I'm sure some of it will come up in questions, and I know votes may interfere.
Canada has done relatively well. Let me speak about this context. I use the word “relatively”. The world has been through a difficult time, particularly the western industrialized economies, since what the economists are now calling the great recession of 2008-09.
We had been paying down public debt in 2006-07 and into 2008—about $38 billion of public debt in Canada—in preparation for what was at that time the concern, quite frankly, which was more the American deficit and the accumulating public debt than it was Europe, although today perhaps the emphasis is more on the continuing recession in most of Europe.
In January 2009 we brought in the economic action plan, which was the budget of 2009, the earliest budget in Canadian history. It was a dramatic move toward stimulating the economy because of the fear that we had of very large unemployment and a deep, dark, prolonged recession.
The economic action plan worked. Canada came out of recession before any of the other industrialized economies. We were in recession for three quarters only. Our unemployment rate, thank goodness, never went into double digits.
Times remain challenging. I just came back from a G-7 finance ministers and central bank governors meeting 10 days ago in the United Kingdom. As I said, Europe has been in a prolonged recession. We're not out of the woods yet. There's a tension between some of the industrialized countries in the west—and I shouldn't just say the west because Japan is part of this—about spending more, stimulating more, more debt, more deficits, more perceived economic growth, and more printing of money, which is euphemistically called “quantitative easing”.
And then there are those of us who feel that the correct balance is what we tried to do in the budget this year in economic action plan 2013; that is, moving continually toward a balanced budget, which we will have by 2015, which was the plan from January 2009, while at the same time stimulating the economy in a few very important areas, which this committee has also highlighted from time to time—manufacturing through the accelerated capital cost allowance extension; infrastructure, which is vitally important to our communities and our municipalities in Canada; and skills training through the Canada job grant.
We feel we've hit the right balance, and we encourage our colleagues in the G-7 to follow that pattern.
The IMF recently remarked—and I'm quoting—“Canada is in an enviable position...[and] the policies that are being deployed are, in our minds, broadly appropriate”.
However, as our government has said over and over, we cannot let our guard down. As we are reminded too often, the world economy remains fragile. The United States and Europe, who are among our biggest partners, continue to face serious economic challenges. As it was noted earlier this month, the euro zone is now in the longest recession it has ever experienced, that is to say negative economic growth for six consecutive quarters.
In the middle of this economic and global turmoil, Canada must also face the reality of a more and more competitive world market, with the increased participation of emerging economies such as Brazil, India and China.
To build a stronger economy and produce increased job growth, the many positive initiatives contained in Bill C-60 include the major measures I've already mentioned with respect to manufacturers. There is also the indexing of the gas tax fund, which was a major pre-budget request of the Federation of Canadian Municipalities during our meetings with them, and I know the committee had the same experience. We are extending the mineral exploration tax credit. We know that sector of the Canadian economy has a lot of growth and is very important to Canadian economic growth overall. We are providing $165 million in multi-year support for genomics research, $18 million to the Canadian Youth Business Foundation to help young entrepreneurs grow their firms and their futures, and $5 million to Indspire for post-secondary scholarships and bursaries for first nations and Inuit students.
Additionally, Bill C-60 brings forward many positive initiatives to support families and communities. Some of these are much less expensive than the major initiatives, of course: promoting adoption by enhancing the adoption expense tax credit; introducing a new first-time donor's super credit to encourage Canadians to donate to charity—that came in significant part out of the work done by this committee on charitable issues. We are expanding tax relief for our home care services, providing $30 million to support the construction of housing in Nunavut, investing $20 million in the Nature Conservancy of Canada to continue to conserve ecologically sensitive land, providing $3 million to support training in palliative care for front-line health care providers, committing $3 million to the Canadian National Institute for the Blind to expand library services for the blind and partially sighted, and supporting veterans and their families by no longer deducting veterans' disability benefits when calculating other select benefits. There are also many other initiatives.
I know you have had an opportunity to look at Bill C-60 carefully. I know some parts of the bill have been referred to other committees of the House of Commons. I emphasize to you the need for balance in the approach we take as a government. I can tell you that in international discussions I have had with my colleagues in finance and central banking around the world, Canada is well respected for the way we have grappled with economic issues also facing other countries over the course of the past several years.
I am prepared to receive questions, Mr. Chair.
