Debates of Jan. 21st, 1994

The House resumed from January 20 consideration of the motion for an address to His Excellency the Governor General in reply to his Speech at the opening of the session; and the amendment.

Speech From The Throne

[The Deputy Speaker]

Before giving the floor to the President of the Treasury Board, I would like to read a very brief statement.

Members will be aware that Telesat Canada has encountered major technical difficulties with the Anik E2 satellite. That is the satellite that is used by the cable parliamentary channel, as members will know, to distribute our proceedings across the country. I would therefore advise hon. members that until further notice there will be no national distribution of these proceedings. Members will be advised when this is rectified which hopefully will be soon.

[Art Eggleton, Liberal, President of the Treasury Board and Minister responsible for Infrastructure]

Mr. Speaker, now I guess we can relax a little more.

I want to begin by congratulating the Speaker on his election. May I also, in addition to congratulating him, congratulate you and your colleagues who will assist him in that capacity.

I want to go beyond that. For my part I want to pledge that I will do all I can to assist you, Mr. Speaker, in ensuring that this House provides the forum for civilized and informative debate that Canadians I think are really expecting from their elected representatives.

Unfortunately, I cannot make my speech in French, because my fluency in that language is far from adequate. However, I can assure you one of my personal goals is to improve my French, not only because it is the other official language but because it is a beautiful language and the expression of a rich and important culture, both in Canada and internationally.

This is my inaugural address to the House. Therefore while preparing for today's debate I spent some time thinking about the men and women who preceded me in this place. For new members like myself there are many excellent role models to choose from. In fact there are people who now serve and who used to serve in this House whose compassion, persuasiveness and original thinking I admire a great deal. One such person is my predecessor the former member of Parliament for York Centre and a former Solicitor General for Canada, the Hon. Bob Kaplan. Bob Kaplan was an outstanding parliamentarian, a respected community leader and a man who is still highly regarded by his constituents. During the course of the election campaign I was struck by the degree of attachment and devotion people felt for him. Bob set a very high standard of service to his constituents and one that I will try to emulate.

While I am new to this House and to politics at the national level, I arrive here with the perspective of 22 years experience in municipal government, including 11 years as the mayor of Toronto. It was an honour to be mayor of my city and now I have the honour to use that experience for the benefit of the people of York Centre and the people of Canada. It was also that experience that persuaded me of the need for Canada's three levels of government to address the need to enhance the quantity and the quality of infrastructure in our cities, towns and villages.

I was a member of the board of directors of the umbrella organization known as the Federation of Canadian Municipalities during the period when it undertook a major survey of the state of our municipal infrastructure, a survey which demonstrated the extent of our need for new investment.

I was one of those who helped the federation shape its proposal for a new three way program of co-operation between the federal, provincial and municipal levels of government to renew Canada's municipal infrastructure.

The work of the federation did not take place in a vacuum. Throughout the industrialized world the last few years have seen a very active, renewed interest in the role and the importance of infrastructure, whether it is for economic competitiveness to attract investment, environmental protection and improvement, the quality of public amenities and the quality of life in general.

For these reasons and despite extremely difficult fiscal constraints which we are well aware of, the Liberal Party chose to undertake a major co-operative program of infrastructure renewal as one of the central planks of its election platform.

In my riding many people earn their living in construction related industries. During the recent election campaign our leader and current Prime Minister travelled to York Centre to outline our new program on infrastructure to an audience of skilled trades people from our local unions. These union officials report that their membership suffers greatly from high unemployment. In fact, levels get as high as 50 per cent at times in this industry in the Toronto area they told me. Our proposal, therefore, struck a deep responsive chord with these workers and with the Canadian public.

Given the importance which the Prime Minister attaches to the infrastructure program I was honoured when he asked me to become the Minister responsible for Infrastructure in the new government. The Prime Minister underlined to me the importance of moving quickly to develop agreements with the provinces and to get the program up and operating. An early start to this program will provide new hope to Canadians and help to rebuild the confidence that is such an important part of our healthy economy.

Some Canadians are asking why we have chosen infrastructure as a major priority and why are we doing this now. The answer is that the infrastructure program has become a cornerstone of the government's programs because it will create jobs while refurbishing at the same time Canada's infrastructure and promoting our long term economic growth.

There is also strong evidence that much of our infrastructure has deteriorated and deteriorating infrastructure, as they found out in the country to the south of us, can be a serious detriment to not only the quality of life but, of course, to attracting investment dollars into their communities.

Beyond that, the current tough economic climate has brought more competitive pricing and it provides, therefore, government with a chance to stretch the construction dollars to the maximum. This promises real value for the taxpayers.

The infrastructure program has not been designed as the government's only job creation project, I hasten to add, but rather as an important stimulus to the economy as a whole. The exact number of jobs it will create depends on the construction projects which will be approved. Some projects such as repairs and renovations will be extremely labour-intensive while those such as cultural facilities are also going to create long-term jobs.

One thing, however, is clear: The program will have substantial impact on unemployment. In fact, the Federation of Canadian Municipalities has estimated that for every billion dollars invested, some 20,000 jobs are created. The infrastructure program is more than simply the building of roads, the building of bridges or sewers. It is more than repairing buildings, more than restoring water supply systems. The infrastructure program is an integral part of the vision of the new Liberal government to lay the foundation for economic recovery, to kick-start a sluggish economy and provide a future for Canadians, particularly for young Canadians who are currently without hope or prospects.

We will give these young Canadians new hope and confidence in the future. That is what we said we would do in the red book and that is still our commitment now that we are here as the government.

This is an ideal time for accelerated investment in public infrastructure, as I have already said. Also, let me say that national unemployment, which stands at an unacceptable level of over 11 per cent and in the construction industry over 20 per cent, and as I said a few moments ago over 50 per cent, are very key reasons why we need to move into this program at this time.

There is a terrible waste of human talent and a tremendous distress on the part of hundreds of thousands of people and their families right across this country. I met many of these people in the course of the election campaign. I understand their pain and I understand their frustration at what has been called a jobless recovery. That is why the speech from the throne earlier this week stated: "the government attaches the highest priority to job creation and economic growth in the short and long term".

I am pleased to say that in the brief few weeks since the new government was sworn in we have made very tangible progress to put this new infrastructure program into place. After discussions between federal and provincial ministers and various officials, the Prime Minister and the provincial premiers endorsed the program when they came here to Ottawa for their meeting on December 21. Last Friday, January 14, less than 10 weeks after the new government was formed, we signed our first four federal-provincial framework agreements establishing the Canada Infrastructure Works Program for the provinces of Nova Scotia, New Brunswick, Manitoba and Saskatchewan.

My colleagues, the Minister responsible for Atlantic Development and the Secretary of State for Veterans Affairs, are signing an agreement today with Prince Edward Island and we will continue this momentum on Monday when the Minister of Industry and I will be in my city of Toronto to sign a similar agreement with the province of Ontario. I expect to sign agreements with the other four provinces and the territories in a matter of days.

The conclusion of this number of federal-provincial agreements in so short a time demonstrates that the federal government is honouring its commitment to Canadians to create jobs and to create jobs now.

Our success owes a good deal to the very co-operative attitude taken by all of the provincial governments. They have recognized the intrinsic merit of the program, they have responded to the public's desire for early action, and have shown a determination to demonstrate that federal and provincial governments can work quickly and co-operatively. I wish to express publicly my gratitude for the exceptional co-operation of the provinces on this program.

I also wish to underline the importance of the support this program has received from mayors and other elected representatives at the local level across Canada. They have been supportive, they have been enthusiastic, they are very much equal partners. I am delighted that the federal government will be able to contribute so significantly to a program that our local governments have created and have advocated for a number of years.

The federal contribution will be very tangible and very significant. We are providing the provinces and municipalities with a total of $2 billion over the next two years. For the most part the federal contribution will be matched equally by the provinces and municipalities. This will provide for a total joint program of $6 billion.

In some projects however the provinces themselves will provide two-thirds of the funding, while the federal government will contribute its normal one-third share.

Similarly the program will have flexibility to accommodate private financing. In fact the subject of my address in November 1993 to the Canadian Council for Public-Private Partnerships opened the door for possible private financing of infrastructure projects.

The focus of our program is on local infrastructure and we believe that it should be the local and provincial governments themselves which take the lead in proposing projects. There will be, as is natural, differences in the precise form that the program will take in each province. In some cases only municipal projects will be considered; in others, other local government institutions such as education boards may be eligible, or there might be projects carried out by the province itself. Indian reserves are also included in the program.

As well the emphasis on types of infrastructure may vary by province. Some will put more emphasis on the traditional water treatment or sewage. Others may be more inclined to support roads or construction or repair of existing facilities. These variations should reflect local needs and priorities. That is what we clearly said in the election campaign and that is what we want to see carried out.

We should also point out that this is a national program and we expect some elements of consistency across the country. In all provinces the federal government will review projects in relation to broad program criteria such as long and short-term job creation.

We will be looking at the environmental benefits, wanting to ensure that environmental practices and environmental assessments are adhered to. We will be looking at the incremental or accelerated nature of the project. We are not looking to just fund projects that were going to go ahead anyway. We want to fund projects that create additional jobs.

We will be looking at the distribution of benefits within a province. We want to make sure there is a wide distribution in benefit across each province. We will be looking at the use of advanced technology. The term as to what infrastructure includes is changing because the economy of this country and of this world is changing. Here is an opportunity in fact to develop infrastructure, invest in infrastructure that has to do with the future kinds of jobs that will be taken by our young people in this country.

We will look at the use of innovative financing and the contributions to skills development. As people learn new skills the opportunities for them beyond this program expand. The bringing of infrastructure up to community standards, up to community codes will be considered. We will want cost-benefit information about these projects. We are also going to want to have cost control measures.

Our basic approach is to provide enough guidance to ensure the high quality of the projects approved, but at the same time to leave ample room for local or provincial priorities. We are offering federal money for infrastructure programs as you know at a time of very severe fiscal constraints. We all are very conscious of the financial constraints upon all governments in this country.

This government believes so much in the value of this investment that it is prepared to take the tough decisions to find the necessary funds through reallocations in the federal budget and by cutting spending proposed by the previous government.

The federal government, I should add, may well recoup much of its $2 billion investment from additional tax revenues which will fall into the federal treasury as a result of increased construction activity. For every dollar spent on the proposed construction projects, federal government revenues in the form of taxes, unemployment insurance premiums and Canada pension plan contributions will increase. The federal government of course will also benefit from reductions in payments that it makes for the unemployed because they will be getting back to work. They will be able to restore their dignity and their desire to contribute to this nation.

We moved quickly to sign framework agreements with the provinces and we shall move quickly to approve projects after we have appropriately evaluated them. Already federal and provincial officials in each province are working to refine the criteria and the guidelines which apply in each province. Local governments are being consulted. I expect to receive recommendations for the first proposals in the coming weeks and to see some projects approved in time for work to start in the spring of this year.

I know members of this House will take a close interest in the projects in their constituencies. For this reason we shall invite comments from each member of Parliament on projects recommended for his or her riding so that we can ensure that any information a member wishes to bring to our attention is available before a decision is taken.

I look forward to members honouring the spirit of this consultation which will need to be done quickly and with full respect of our local and provincial partners if it is to be effective. For my part I shall listen to the views of all members with great interest. I look forward to the chance to discuss the program with individual members as well.

The infrastructure program has received wide support across Canada not only from local governments but also from provincial governments, of very different political persuasions I might add. I hope members of this House will be responsive to this wide support and work as co-operatively as they can to ensure the success of the program.

The Prime Minister in his remarks in the debate on the speech from the throne emphasized that the long-term future of our country lies in forming a new partnership, a partnership where the municipalities and the provinces work in genuine co-operation with a national government which has the vision of what can be, not what used to be.

[Gilbert Fillion, Bloc, Chicoutimi, QC]

Mr. Speaker, I would like to start by congratulating the minister on his infrastructure program which is to be launched very soon, witness the announcement concerning construction of the convention centre in Quebec City.

I represent the riding of Chicoutimi, which includes the municipalities of Rivière-Éternité, Petit-Saguenay, L'Anse-Saint-Jean, Saint-Félix-d'Otis, Ferland-et-Boileau, Ville La Baie and Chicoutimi. The unemployment situation in all these municipalities is very bad. In the Saguenay-Lac-Saint-Jean area, the unemployment rate is an unacceptable 16 per cent, and there is nothing in the throne speech to indicate that this percentage will go down.

This government's infrastructures program will certainly not be enough to turn around the economy, either in the riding, Quebec or Canada. We must break the vicious circle of unemployment insurance which means that people work four months a year on a government project and then are unemployed for the rest of the year. If they are lucky, after using up their unemployment insurance benefits they might qualify for another government project, but that is it, and then they end up on welfare, which makes it even harder to get back to work.

Economic recovery must be achieved through regional development by giving the regions all the infrastructures they need, not just the road networks covered by your program but infrastructures for water and air transportation which provide links between the regions and give them access to major urban centres.

Mr. Speaker, in addition to the infrastructures program, could the minister confirm there have been cabinet-level discussions on other programs aimed at a sustainable reduction of the unemployment rate, which the government will be tabling very shortly?

[Art Eggleton, Liberal, York Centre, ON]

Mr. Speaker, I thank the hon. member for his question and also for enlightening me with respect to the conditions in his constituency of Chicoutimi and other municipalities.

I hope this infrastructure program will be of benefit to them. I hope certainly that the municipal leaders are encouraged by the member to put forward projects that can be of benefit to the communities and economy of the region.

As I indicated in my remarks, the government has put this forward as one of its programs and projects that it wants to use to help rebuild the economy and get Canadians back to work.

There are discussions going on on many other types of programs. One has to only look in the red book to see the many different things for young people, for people right across this country, for small business.

We want to promote and help ensure that Canadians can get back to work. What we need badly in this country is a more balanced approach to economic planning. That is what the Liberal government has committed itself to do. It committed itself in the throne speech to give the highest priority to getting Canadians back to work.

[Gaston Leroux, Bloc, Richmond—Wolfe, QC]

Mr. Speaker, clearly this infrastructure project has created tremendous expectations and this was obvious from the general reaction of the municipalities. In his speech, the minister outlined ten or so conditions that will have to be met by all provinces in order for the program to be successful. He spoke of the need for cost

control mechanisms, while allowing some room to manoeuvre. Could the Minister explain what kind of national criteria he has in mind for controlling costs while still allowing third parties some room to manoeuvre?

[Art Eggleton, Liberal, York Centre, ON]

Mr. Speaker, this program is a co-operative program with three levels of government. Each project will require each level of government to sign off on it.

Each level of government has a responsibility also to ensure that the taxpayer's dollar is well spent. I do not think any level of government wants to get into a situation of cost overruns. We want to make sure that there are cost control mechanisms in place. Each level of government has internal auditing procedures and controllership procedures that help to ensure that the best cost estimates are being put forward.

We will have a still further look at it even though the provincial and municipal governments with their very restrained budgets are going to want to make sure that those costs are as accurate as they can be. We are going to want to make sure as well because I want this program to be carried out in an efficient and effective manner. I want it to produce good results. I do not want people to have to face a situation where there are going to be cost overruns.

We will look at cost controls and cost benefits, understanding the benefits that come out at the end of the day. One of the things we said in the red book was that we want to know what these programs produce. What are the results? What are they really going to do for Canadians in the short and long term? Those kinds of evaluations are also part and parcel of what we will be looking at.

Three orders of government will be working together, giving consideration to the fiscal constraints we find ourselves in and the very serious nature of how the taxpayer's dollar is used.

[Philippe Paré, Bloc, Louis-Hébert, QC]

Mr. Speaker, as this is my maiden speech, I would like to begin by saying a few words about my riding of Louis-Hébert. It includes three lovely suburban municipalities in the Quebec City area, namely Cap-Rouge, Sainte-Foy and Sillery, located on the shores of the St. Lawrence.

I listened closely to the remarks of the hon. member for York Centre concerning the infrastructure program and I would like to make a few comments. My first concerns the spirit of co-operation to which the Minister referred. I am very happy that the federal, provincial and municipal governments are co-operating.

This is good to see, except that given the current situation, it illustrates the weak position of the federal government, in view of the size of the debt and runaway government expenses. When the federal government wants to carry out a project, it must work side by side with the municipalities-which in itself is a good thing-and with the provinces. This only reflects the serious state of the government's finances.

The hon. member for York Centre indicated-and I am happy to hear it-that this is not the only job creation program. We will, however, be paying close attention to concrete programs announced later.

The Minister said that the infrastructure program will kick-start the economy. Economic recovery will be difficult, if not impossible, until such time as the government takes serious, radical steps to slash government spending. And there is nothing in the throne speech to indicate that the government intends to take this kind of action.

[Art Eggleton, Liberal, York Centre, ON]

Mr. Speaker, I thank the hon. member for his intervention. I would quickly point out that this is a great example of bringing three levels of government to work together. Is it not about time that we did that rather than have the duplications? We may have three levels of government but we have one taxpayer and that taxpayer wants to make sure we are spending his or her money efficiently and effectively.

That taxpayer is also concerned about government expenditure. Indeed, that is an issue that is also being addressed by the Minister of Finance, by me and by my colleagues in the cabinet and will of course be addressed in the federal budget when it is brought forward.

However, at this point in time we are entering into a program that is unprecedented in terms of the co-operation. It is also a program that is based on local priorities and the need to keep our communities safe and liveable, have the kind of infrastructure to enjoy a quality of life that has been traditionally held dear and which will attract additional investment to improve their economic growth.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, I would like to start by taking this opportunity to congratulate all my colleagues who were elected to the House of Commons on October 25, in an election which must be seen as crucial for the future of Quebec and that of Canada without Quebec.

I also take this opportunity to thank the constituents of the great riding of Saint-Hyacinthe-Bagot, the Quebec agri-food technocity, for the trust they have shown in me by giving me a clear dual mandate: first, to fight most vigorously to protect their interests and those of Quebec as a whole and, second, to pave the way for Quebec to attain full sovereignty to put to rest once and for all the constitutional issue.

Quebec sovereignty is no longer a mere matter of the heart or patriotism. It has become a matter of practicality.

Following the constitutional negotiations of recent years, sovereignty has emerged as the only way to allow our two nations to stop arguing endlessly about the Constitution and start dealing with the real issues.

What are those real issues? First, to undo the harm done by overly liberal budgeting in recent years, especially at the federal level. Second, to promote economic development and competitiveness. Third, to create lasting employment. And fourth, to really tackle the problem of growing poverty in Quebec and Canada.

Let us say, for the sake of argument, that a beneficial restructuring of the relations between Quebec and Canada did occur, such that we would end up with two sovereign countries. Their relations would then be free of any constitutional dispute and a common economic space would be maintained out of mutual interest, not as a favour, as the other side usually says.

That is what the sovereignty plan is all about. It is directed against no one, especially not our Canadians friends. Our plan has a resolutely global reach. It is legitimate, progressive, open and totally in tune with the times.

Until the people of Quebec decide democratically to take their destiny into their own hands, the Bloc Quebecois has received from them the mandate to protect their interests. And whether you like it or not, the Canadian democratic process has given us the role of official opposition in this chamber of Parliament.

As my leader has repeatedly said, the Bloc Quebecois will assume the role of Official Opposition with all the fervour we have come to expect from it, especially in the last four days, because the fight against poverty and unemployment, for example, is universal. Whether you are a federalist or a sovereignist, you must fight these evils.

Equity also has a universal definition and the Bloc Quebecois will act on the basis of this concern for fairness. For Quebec first of all, because the inequity in federal spending is most flagrant in its case, and elsewhere if required.

Mr. Speaker, you will understand that, as the Official Opposition, we will often be working towards the Bloc Quebecois's ultimate goal, which is to pave the way for sovereignty for Quebec.

Where public finances are concerned, no one in Quebec or Canada has any interest in seeing the already catastrophic state of the federal government's finances deteriorate further. Canada and a sovereign Quebec will have to assume their share of the federal debt.

The same goes for international trade. It is definitely in Quebec's interest, beginning with Quebec's duly elected representatives in the Bloc Quebecois, to ensure that the international agreements recently concluded in its name are beneficial. Under the rule for successor states, a sovereign Quebec would inherit the commitments already made by Canada.

So in these two specific areas, public finances and international trade, we have seen recently that both Quebecers and Canadians really need a vigorous official opposition.

Quebecers and Canadians need a strong opposition because the federal government, the present Liberal government, intends to solve the Canadian government's financial problem using the same approach that it criticized the previous government for, namely putting the burden of fiscal reform on the poorest members of our society. As my leader said, that is unacceptable.

Modernizing and restructuring the social security system as suggested in the speech from the throne, knowing that this reform comes from the same senior civil servants, these great mandarins, one of whom has now become the new member for Hull-Aylmer, these great mandarins praised to the skies by this government, such a reform simply means cutting social programs.

We see the same sinister intent in a publication on Canada's economic challenges issued last week by the Minister of Finance. What do we find in this new bible of the federal mandarins? We read that Canada spends more on social assistance than its major trading partners. It says that our unemployment insurance system is more generous than average and creates major disincentives to work. Major disincentives to work-I find that downright odious.

This is despicable because, as the Leader of the Official Opposition said two days ago, nobody goes to the unemployment office for the fun of it. Nobody in Quebec, as in the rest of Canada, is proud to be unemployed or on welfare. And everybody wants to enjoy the fundamental right to work. When I read this document and the recent statements made by our friends across the floor, I get the impression that I am reading old stuff written a century ago by ultraconservative economists.

This document from the Department of Finance also mentions that our public expenditures related to health care are higher than others, without noticeable results. I was flabbergasted to see this kind of statement in the Department of Finance's document, because those are precisely the people who, not long ago, were saying that our health care system was the best and the cheapest in the world. Now they are contradicting themselves and, because they want to please some ultraconservative economists met recently at a seminar, they are prepared to make cuts to health care programs.

We can now better understand the meaning of the comments made last December by the hon. member for Hull-Aylmer, who is himself a former mandarin, and who alluded to the possibility of a 20 per cent cut in the health care budget. We can also better understand the meaning of the throne speech.

I am absolutely flabbergasted to see that, in less than three months, this government has violated the basic principles underlying its electoral platform. This government was elected on the basis of false premises regarding, among others things, social programs. It has also reneged on its monetary policy. We now know only too well what has become of the promises made by the Liberals. Shortly before the Christmas holidays, the Minister of Finance appointed Mr. John Crow's successor, namely his assistant and advisor regarding monetary policy who is also obsessed with fighting inflation.

It must be remembered that, among the G-7 countries, Canada was the most adversely affected by the recession of the early nineties. Canada was also the first one affected among the industrialized nations of the world. Why is that? It is precisely because of this obsession with fighting inflation regardless of the consequences on employment and on jobs in general.

Today, even though inflation pressures are still weak, and while Quebec has only gained back a quarter of the jobs it lost and the economy has not reached its full potential, the Liberal government is refocusing its monetary policy to fight inflation instead of aiming for a fair balance between price stability in the long run and employment growth in the short run. These same people are now telling us that with their infrastructure program, they will be able to create thousands and thousands of jobs. Contradictory measures like this infrastructure program only go to show the inconsistencies in the Liberals' policies.

Such policies are contrary to what the Liberals talked about during the election campaign and even before that, when they were the official opposition in this House.

Let me remind you that on November 26, 1992, both La Presse and Le Devoir quoted the present prime minister as saying: For several months now, we have clearly indicated that we are proposing a growth policy based on low interest rates. And if the Canadian dollar should weaken, we can live with that''. That is what the present Prime Minister had to say only two years ago. Today, he is doing exactly what he was blaming the Conservatives for. The present prime minister also said:People are becoming obsessed with the anti-inflationary policy''. Can you believe that. The Liberals themselves have developed an obsession for the same monetary policies they used to criticize.

Earlier this week, the Minister of Finance even said about the throne speech: "We will be worthy of the trust Canadians put in us". He mentioned that the speech from the throne would break the vicious cycle of "cynicism and deception Canadians felt about politics".

This kind of approach, this kind of backtracking will not do anything to break the cynicism that exists towards the old federalist parties; it is there to stay.

And there will still be cynicism about the tax equity issue since nothing leads us to believe that the Liberals will do something about that despite having complained loudly about the unfairness of our tax system during all these years. The government does not have the political will to eliminate all the tax loopholes and all the tax breaks that some people benefit from. We always point to the same problem, and with good reason. Just as the Conservatives before them, the Liberals probably have their hands tied by Canada's richest families who contribute to their election fund.

There are plenty of examples of unfairness and inequity in our tax system, Mr. Speaker. Here are some of them. In 1987, the most recent year for which this kind of data is available, 90,000 Canadian companies made profits totalling $27 billion and paid no taxes at all. There is no in-depth study on this but in 1991, according to the Auditor General, a minimum of $16.1 billion in revenues found their way to various tax havens. Hundreds of millions of dollars in federal tax revenues are lost through the family trusts which we talked about earlier this week.

Here is another example of unfairness and inequity in our tax system. In 1991, 368,000 taxpayers with a total declared income of $60 billion, that is an average income of $163,000 each, paid a federal income tax of only 18 per cent. That was their real tax rate because of all the tax loopholes. But isn't the basic rate 29 per cent, Mr. Speaker? This is shameful.

On the other hand, a certain Ms. Pauline came to my riding office last week. She is on welfare and her income is about half the poverty threshold in Quebec as well as Canada, and she received a letter from Revenue Canada asking her to pay her income tax like any other taxpayer. Mr. Speaker, that is nothing short of outrageous.

Two days ago, the Auditor General reported a number of cases of profligate spending and misuse of public money. I noticed two cases which are striking enough to demonstrate the urgent need for tax reform to achieve greater equity instead of wasting money.

Investment Canada spent $132,000 to set up a new office, kitchen and bathroom for its new president, while her predecessor had an office in the same building with the same conveniences. Mr. Speaker, $132,000 is the equivalent of the annual income of four households. It is utterly disgraceful. The Auditor General also pointed out that because of a loophole in a deduction concerning natural resources, the government lost $1.2 billion in revenue, mainly in the oil and mining industries.

What is this government waiting for before they settle once and for all these problem that plague Quebec and Canada alike?

That is where we can find money to get the public finances in order. That is where we should go to reduce the revenue shortfall of the federal government, which over the years has generated an accumulated debt of over $500 billion. These are the persons we should be after, not the less fortunate like Ms. Pauline in the riding of Saint-Hyacinthe-Bagot.

We should not cut transfer payments to the provinces either. When will those opposite realize that, in the end, it falls on the backs of the same taxpayers. I will give you just one example taken from the Quebec public accounts. All the measures taken since 1980 either to reduce or freeze transfer payments to the provinces have cost the government of Quebec over two billion dollars. Who had to provide for this shortfall in federal transfer payments to Quebec? The women and men of Quebec, of course, because they are the same taxpayers. All this to say that shifting the burden onto the provinces is not a way to improve the fiscal situation.

Given these shameful and odious fiscal inequities and the disastrous state of federal public finances, the Bloc Quebecois reaffirms the need to proceed with a public examination by Parliament of all federal budgetary and tax expenditures. We do not want a media circus of unending consultations which would only postpone a necessary reform. We do not want piecemeal reform. We do not want a little something here and a little something there. We want an in-depth examination by Parliamentarians of federal fiscal policies and expenditures.

One last point before I conclude. There is another thing barely mentioned in the speech from the throne, and that is the GATT agreement. Instead of wasting his time arguing about impossible changes to the North American Free Trade Agreement, the way he did after the House of Representatives passed the NAFTA, the Prime Minister of Canada should have focused on the final sprint toward a GATT agreement. The Bloc Quebecois welcomes the conclusion of the eighth GATT round, and I say this without reservations. The Bloc, like Quebecers generally, takes a global perspective, an attitude that is entirely compatible with nationalism and sovereignism, as I indicated at the beginning of my speech.

However, although we welcome the conclusion of the Uruguay round, we are not satisfied with Canada's performance in this area, especially in the negotiations on agriculture, in the course of which article XI-2(c)(i) of the GATT rules, an article that was vital to agriculture in Quebec and Canada, was dropped.

This article was vital because it ensured the survival and effectiveness of the supply management system in Canada's dairy and poultry sectors. The Canadian government gave up this article without obtaining anything in return. That was the worst part, like the government's financial situation. Nothing was obtained in return, while countries like South Korea, Japan, the United States, France and Belgium privately obtained exemptions that were included in the eighth GATT Round.

Why did Canada not obtain an exemption? Because it failed to take a firm stand and because the Prime Minister, unlike Mr. Clinton in the United States, Mr. Mitterrand and the Japanese and South Korean prime ministers, did not get involved in the final sprint to protect article XI-2(c)(i) and the interests of Quebec and Canada in this area.

The Bloc Quebecois does not blame the Canadian government for losing. These negotiations involve more than 110 countries, and it stands to reason that we cannot win on all fronts and might have to give up some of the items on our list. However, the Canadian government and the Prime Minister failed to do everything they could have done, which makes matters worse.

It is public knowledge that the Government of Canada is about to cave in once more and renege on its commitments in negotiations on the GATT rules with the United States. For instance, in negotiations with the United States on border tariffs that will replace article XI, the government is poised to make concessions on tariff levels that are supposed to protect the dairy and poultry sectors.

Unfortunately, the Canadian government has also caved in to unfounded rumours that U.S. borders would be closed to exports of durum wheat from the Canadian prairies.

In concluding, the Official Opposition deplores the lack of vigour shown by the government in defending the interests of Quebec and Canada and the lack of any concern in this respect in the throne speech at the opening of the 35th Parliament.

As the Official Opposition, the Bloc Quebecois intends to keep a close watch on further developments.

[Dennis Mills, Liberal, Parliamentary Secretary to Minister of Industry]

Mr. Speaker, I would like to begin by congratulating the member for Saint-Hyacinthe-Bagot for his maiden speech in the House of Commons. There were moments as I listened to him speak when I was reminded of some of the things that we said in opposition just a few months ago. I would like to be very specific about that part of his speech that dealt with the issue of tax reform.

I want to say to the hon. member that the Prime Minister stated repeatedly before the campaign, during the campaign and during the speech from the throne that this government is dedicated to comprehensive tax reform. We are dedicated to working with all members of this House in finding a more simple, fair and efficient way of dealing with the tax issue in this country. We agree that the current tax act has tax preferences and privileges that need to be reviewed because the current system is not working.

He should not think that because we have come from one side of the floor to the other we will run away from the issue. Many members know I have a particular bias in that area called the single tax, l'impôt unique, and I will be sending copies to him and his colleagues for review.

The second point I want to make to the member has to do with his statement where he said "we want to have a situation in Quebec where our financial condition does not deteriorate". I support the position the member has taken, but I think it is important to point out to all Canadians and all Quebecers that we have a system in this country, managed by the Government of Canada, called the equalization entitlement program.

As the member knows, the province of Quebec is at this moment in time a have not province, as are many other provinces. We do have three provinces that we define as have provinces; British Columbia, Alberta and Ontario. Since 1969 the equalization entitlement, and I stress the word entitlement here, by this federation, which is the total amount of that transfer to the province of Quebec, has been approximately $52 billion. I support this approach and that is why I think it is important to have a strong national government. I will make sure that the member has time to respond.

What I am having a very difficult time understanding is how one can maintain the same standards in education, health care and all other national standards that all of us want to achieve when one gives up a situation called equalization.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, during the next few minutes, I will try to reply to two statements that struck me in the speech of my Liberal colleague. First, Mr. Speaker, he compared the Bloc Quebecois, as the Official Opposition, to the Liberal Party when they were the Official Opposition. Let me remind him that he should not mix apples with oranges.

As the Official Opposition we have been saying right from the beginning that in the area of public finances we were reaching out to the government to make a democratic effort to launch a thorough review of all Canadian finances, not only budgetary expenditures, but also tax expenditures.

Instead, since the beginning of November, the Minister of Finance has gone through an endless round of consultations with economists and institutions here and there. In Quebec, we call that an acute case of consultationitis. It looks like a strange rerun of what we have known since the Meech failure with all the other constitutional conferences, forums and discussions. Remember the Citizens' Forum on Canada's Future, chaired by Mr. Keith Spicer, and the Beaudoin-Dobbie and Beaudoin-Edwards commissions. I feel the Minister of Finance wants to repeat the same scenario with budgetary and tax expenditures instead of implementing a real measure of-

[The Deputy Speaker]

Order. The member for Brant would also like to ask a question if the member agrees.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Very well.

[The Deputy Speaker]

As we have but 90 seconds left, I would ask the hon. member for Brant to be very brief, please.

[Jane Stewart, Liberal, Brant, ON]

Mr. Speaker, I felt compelled to respond to a couple of things that the hon. member mentioned in his speech.

First, I believe he said that we as Liberals talked about our health care system as being the best and the least costly. Yes, we did talk about it as being the best but certainly not the least costly. Our position was that we spend a tremendous amount of money on our health care system and our challenge is to make sure that we spend it effectively and wisely.

Second, I would like to ask both the member and his leader a question. They have identified or they seem to believe that just because we wish to change, improve and make more relevant the social safety net we have here in Canada that we will necessarily make it more difficult for those less advantaged. I ask the hon. member why he assumes that is in fact so.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, the Bloc Quebecois is not opposed to improvements to the health system. That is not the point. The point is that every time fiscal restraint is being considered, health care and social services are prime targets. That is absolutely disgusting, totally unacceptable. The Canadian system is among the least expensive in the world. Just remember how it stood the comparison with the American system. You too made that comparison, Mr. Speaker. The Liberals did it also in the past, comparing it to the health coverage provided by the private system in the States where there is no public health care. I do not remember the exact numbers but it was very clear that the Canadian system was among the most efficient and the least expensive in the world.

Every time there is talk of fiscal reform, of tackling the debt or the annual deficit, the main targets, the first ones to be singled out are health care and social services. Let us not forget that since 1990, the most vulnerable members of society have grown in number. Unemployment is on the rise. Job creation is not picking up; unemployed workers are losing hope and joining the ranks of the non-working population on welfare; their number is increasing in Quebec and throughout Canada. Let us not forget that. There is a way to get the public finances in order-

[The Speaker]

Order. It being eleven o'clock a.m., pursuant to Standing Order 30(5), the House will now proceed to statements by members, pursuant to Standing Order 31.

National Debt

[Gurbax Malhi, Liberal, Bramalea—Gore—Malton, ON]

Mr. Speaker, Canada's national debt surpassed one-half trillion dollars earlier this week. This milestone will be a millstone around our necks if we do not change our attitude now. Our children's quality of life depends on it. How can any of us, with clear conscience, expect future generations to pay for the mistakes of the past?

This new government fully intends to slay the beast of debt. Only then can our children make up their own minds as to where their money will be spent.

Auditor General's Report

[Gaston Leroux, Bloc, Richmond—Wolfe, QC]

Mr. Speaker, in the report he tabled on Wednesday, the Auditor General regrets that the government denies access to information on ministers' travel expenses. Because of this, the public accounts committee is not adequately assured that such information is accurately disclosed to Parliament. And we are not talking about small amounts. For fiscal year 1990-91, the Auditor General estimates the cost of using the administrative flight service to $54 million, including some $25 million for ministers' travel expenses.

And as the Auditor General puts it, and I quote: "The government should conduct a review of the economy, efficiency and effectiveness of providing government aircraft to transport such users."

This is a clear example of the need to create a parliamentary committee to examine spending programs, item by item.

Thus, I demand that the Liberal government stop dithering and show openness and put such a program in place.

Peacekeeping

[Bob Ringma, Reform, Nanaimo—Cowichan, BC]

Mr. Speaker, the Reform caucus wishes to acknowledge the help it has received in its preparation for the very necessary and welcome debate on peacekeeping next Tuesday in this Chamber.

The hon. ministers of foreign affairs and defence and their departmental personnel were very forthcoming with briefing assistance, as was the Library of Parliament.

Yesterday we were briefed by Major General Lewis MacKenzie, retired, through his own generosity. While General MacKenzie does not have any magic solutions to this very convoluted problem in the troubled area of the former Yugoslavia, he nevertheless provided us with many helpful insights.

We would like to go on record as saying that Canada is fortunate to have peacekeepers of General MacKenzie's stature.

Carbon Dioxide Reduction

[Charles Caccia, Liberal, Davenport, ON]

Mr. Speaker, on page 70 of the red book you will find: "A Liberal government will work with provincial and urban governments to improve energy efficiency and increase the use of renewable energies with the aim of cutting carbon dioxide emissions by 20 per cent from 1988 levels by the year 2005".

We made this firm commitment in the last election. If we are to reduce carbon dioxide emissions we will have to marshall all available technology, the goodwill of all levels of government and the co-operation of industry, business and Canadians at large.

Canada has to pull its weight in the international community. The reduction of carbon dioxide is a concern of the international community. The Government of Canada has a big task to perform. Time is of the essence.

Georgina Ice Fishing Derby

[Karen Kraft Sloan, Liberal, York—Simcoe, ON]

Mr. Speaker, the annual Georgina ice fishing derby opened last week in the town of Georgina. I invite everyone in the House to visit the fishing huts on Lake Simcoe.

The Georgina ice fishing derby is a wonderful example of how community groups, local businesses and town council can all work together for the benefit of their community. Last year people from all over Ontario, Canada, the United States and as far away as Europe participated in this annual event, generating valuable tourist dollars.

This event increases awareness and appreciation of the environmental and commercial value of this beautiful lake. Lake Simcoe is worth more than $500 million annually to the economy. This translates into thousands of jobs that could be at risk if we fail to save this lake.

I urge all levels of government to work together to ensure the health and future viability of Lake Simcoe.

General Agreement On Tariffs And Trade

[Pat O'Brien, Liberal, London—Middlesex, ON]

Mr. Speaker, Canadian farmers have reluctantly accepted that it was impossible for the government to save article XI at the recent GATT negotiations. They are aware that Canada stood virtually alone on this issue. Also they realize that we inherited an untenable position from the previous government and they know that we fought as hard as we possibly could to save article XI.

Given that reality, they now expect this new government will be firm on tariff levels and that it will not cave in to bullying tactics by the United States or any other country. They look to us to champion their cause and not to cave in to these countries.

As the member of Parliament for London-Middlesex I intend to fight for my constituents today and every day. I am confident that this government will not let Canadian farmers down.

Cigarette Smuggling

[Paul Mercier, Bloc, Blainville—Deux-Montagnes, QC]

Mr. Speaker, I would like to express my astonishment at the persisting inaction of the government with regard to cigarette smuggling. Obviously the adverse effects of this situation are serious.

First of all, the government is losing hundreds of billions of dollars in taxes.

Second, Canadians feel more and more that a segment of the population is above the law. Respect for public authority is being threatened.

Third, tobacco smoking is not being curtailed since smokers can easily get cigarettes at a lower price than if they were reasonably taxed.

Fourth, business people are getting outraged by this. In fact, we are facing a tax revolt.

The demonstration planned for next Monday by the MATRAQUE movement in Saint-Eustache in my riding could be repeated if Ottawa does not take any action.

The premier of Quebec has already made it clear that he intended to lower taxes on cigarettes and asked the federal government and the government of Ontario to do the same. Ontario has indicated an openness to that proposal.

Reduction of taxes on cigarettes is the most effective way of rapidly eliminating this problem.