Good evening, ladies and gentlemen.
Thank you for the opportunity to appear before the committee this evening.
My name is Aaron Wudrick and I am the federal director of the Canadian Taxpayers Federation, or CTF. For those who aren't familiar with our organization, the CTF is a federally incorporated, not-for-profit citizen's group supported by more than 429,000 people across the country.
The CTF is committed to three key principles: lower taxes, less waste and accountable government.
I have some good news for the committee. Much like Professor Ragan, unlike the vast majority of witnesses you will hear from, I am not going to ask you to spend any money. On the contrary, I'm going to suggest that the best way forward is instead for the government to show restraint.
Our pre-budget brief, an expanded version of which is also available on our federation's website, makes 10 recommendations. On some of those, such as balancing the budget and paying down the public debt, it is fair to say that we do not see eye to eye with the government. We will, of course, continue to advocate regularly on those issues in the public sphere.
Given the time constraints today, I want instead to focus on a few recommendations which I think may have a chance for a broader agreement or at least a better opportunity for productive dialogue.
First is a little discussed issue of the political party donation tax credit. We can all agree that donations to political parties are an act of civic engagement and should be encouraged, but is it really fair that a donation of $200 to the Liberal Party or Conservative Party should give the donor a $150 tax credit, whereas that same $200 donation to the Canadian Cancer Society or Red Cross only results in a $30 tax credit? Is it really fair for political parties to have such a big advantage over the many worthy charitable causes also competing for voluntary donations? We do not think so, which is why we recommend that the political party donation tax credit be reduced to match the same level that charities receive in order to create a more level playing field.
Second, we recommend that the government resist the temptation to implement any of these so-called sugar or fat taxes. The good intentions of those advocating for such taxes is not in question, but the effectiveness of these taxes in meeting their policy objective of improving public health is on much shakier ground. We strongly encourage the government to take a long hard look at some of the unintended and detrimental consequences of such taxes based on the empirical evidence in other jurisdictions before attempting any similar measures here in Canada.
Third, we recommend implementing a truth in budgeting law. Simply put, knowing the cost of promises is an essential part of making informed decisions about their desirability. This is already accepted as a given when it comes to political party platforms during an election, which are always professionally costed. It is time to extend this principle further to include any new proposed legislation in Parliament. Governing is in large part about making choices between competing alternatives and we cannot gloss over the fact that these choices have costs attached to them.
Fourth, we recommend there be a core review of government spending to identify at least the least efficient or wasteful 5% of all program expenditures. The empirical fact is that since 2006, federal program spending has ballooned by 23%, or nearly $50 billion, which far outstrips inflation and population growth. Canadians expect that this money is being spent efficiently and effectively on the programs and services they need and want, and if not, it should be reallocated to areas of higher priority or returned to them in the form of tax relief.
Finally, we recommend controlling public sector pay and spending. There is a natural tension between the interests of public sector unions and the interests of Canadian taxpayers at large. The former group wants to get the best deal for its members. The latter group is the one paying for it and needs confidence they are getting value for their money.
Public sector workers deserve fair treatment, but fair doesn't mean the government should always be overly generous. It is important that the government be as hard-nosed an advocate for taxpayers at the bargaining table as union leaders are for their own membership.
In closing, our basic message to the government is quite straightforward. Please tread carefully. It is natural to be ambitious to help Canadians facing difficult times, but you cannot fix every problem or grant every request for spending. Temper your faith in the power of government to do good with a sober understanding of the limits of that power.
Thank you.