House of Commons Hansard #113 of the 35th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was finance.
Gar Knutson Liberal Elgin—Norfolk, ON
Mr. Speaker, I congratulate the President of the Treasury Board who last night delivered the keynote address to open Technology in Government Week.
Technology costs money. How is the President of the Treasury Board going to make use of information technology to improve services to the Canadian public and at the same time reduce the cost of these services to the taxpayer?
Art Eggleton LiberalPresident of the Treasury Board and Minister responsible for Infrastructure
Mr. Speaker, I thank the hon. member for his question. The real credit for Technology in Government Week goes to the many public servants who are on the leading edge of bringing information technology to better use for the benefit of the taxpayers of this country.
Just a few months ago I released a report called The Blueprint for Using Information Technology in Renewing Government Services with a vision of making government services more affordable, more accessible and more responsive to the needs of the public.
There are a number of flagship projects in this regard that we are going to carry out. Indeed, it is not only going to reduce the cost of government but it is going to improve the services that are provided to the taxpayers of this country.
Suzanne Tremblay Bloc Rimouski—Témiscouata, QC
Mr. Speaker, my question is for the Minister of Canadian Heritage. The minister recently indicated that, in all likelihood, the bill on the second phase of the copyright reform will not be tabled before the beginning of next year. Yet, that reform has been long awaited, over six years in fact.
Will the Minister of Canadian Heritage confirm that the tabling of this bill is postponed to 1995, while he had pledged to present that legislation before the Christmas recess, and will he tell us why?
Michel Dupuy LiberalMinister of Canadian Heritage
Mr. Speaker, the hon. member is confusing two different things: The basic decisions regarding the object of the bill which, as I said, will be made by the Canadian government before the end of this fall, and the actual tabling of the bill, which requires a substantial amount of work by the Department of Justice.
I did not contradict myself. We are on schedule. We are on course and we are following our timetable.
Suzanne Tremblay Bloc Rimouski—Témiscouata, QC
Mr. Speaker, are we to understand that the postponement of the copyright bill is due to the struggle between the Minister of Canadian Heritage and his colleague, the Minister of Industry, regarding the issue of neighbouring rights?
Michel Dupuy LiberalMinister of Canadian Heritage
Mr. Speaker, there is no postponement. The hon. member misunderstood what I said. I think that she wants to look like she is trying to protect the artists. But I will tell you: She can try all she wants, people will not be fooled.
Paul Forseth Reform New Westminster—Burnaby, BC
Mr. Speaker, my question is for the Minister of Justice.
For a year now Canadians have been pleading with this government to make changes to the criminal justice system. Canadians want a tougher Young Offenders Act, they want serious offenders off the street and behind bars and they desperately want a life sentence to mean life.
Will the Minister of Justice reassure the people of Canada and tell this House today that tougher and more certain sentences will be put into place for all criminals and for all age groups?
Allan Rock LiberalMinister of Justice and Attorney General of Canada
Mr. Speaker, in the year that we have been here and in connection with the justice agenda we have not only introduced specific changes to the Young Offenders Act which are now before the committee on which he makes a very constructive contribution, we have also asked that committee to undertake a complete review of the Young Offenders Act to ensure that we still have the best model of juvenile justice in this country.
In addition to that we have introduced comprehensive changes, improvements to the sentencing provisions of the Criminal Code and we have passed through this House of Commons an omnibus amendment to the Criminal Code with over 100 changes to modernize and make criminal law more effective.
Beyond that response through legislation with my colleague, the Solicitor General, this government has also created the national crime prevention council recognizing that crime prevention is a very important part of making our communities safer. That balanced approach is succeeding and is going to succeed further in making our communities safer.
Paul Forseth Reform New Westminster—Burnaby, BC
Mr. Speaker, the minister speaks of making changes. How about Allan Kinsella and Serge Damien who escaped from the Bath institution who should have been held in a maximum security prison and should not even have had a hope of parole for 25 years?
Will the minister tell this House whether or not he would support the repeal of section 745 of the Criminal Code and therefore make life indeed life?
Allan Rock LiberalMinister of Justice and Attorney General of Canada
Mr. Speaker, I made my position clear some months ago.
The government's position on section 745 is crystal clear. We introduced an amendment to section 745 to provide plainly that whenever an application is brought under that section that the court is obligated to hear from the families of the victims.
That is the change we propose in section 745. It is contained in Bill C-41 and that is the policy of this government.
Maria Minna Liberal Beaches—Woodbine, ON
Mr. Speaker, my question is for the Minister of Foreign Affairs concerning his meeting with the home affairs minister for India tomorrow, Wednesday, October 26.
There are many Canadians who are concerned about human rights in India. The human rights report and the Asia watch report have both detailed violations.
Does the minister intend to discuss these with the home affairs minister for India when he meets with him tomorrow?
Jesse Flis LiberalParliamentary Secretary to Minister of Foreign Affairs
Mr. Speaker, I congratulate the hon. member for monitoring human rights violations, not only in India. I know she is doing this in other parts of the globe.
Members of this House will be happy to know that yes, the Minister of Foreign Affairs will be addressing this with the minister visiting Canada. Canada is taking advantage of its good relations with India to make continual representations to that country regarding our concern about the human rights violations.
At noon today members of the New Democratic Party, the Reform Party, the Liberal Party and the Senate met with a representative from Amnesty International concerning these human rights violations. I think all members will be happy to know that Canada has made representations for Amnesty International to visit other parts of India, not only Bombay, but Punjab, Kashmir, et cetera.
Audrey McLaughlin NDP Yukon, YT
Mr. Speaker, my question is for the Minister of Health. Last week the Prime Minister opened the National Health Forum by stating: "Canada's health care costs must be cut or medicare could be destroyed". Today we saw a study that showed that drug prices have increased 11.6 per cent.
What is the minister's position? In opposition it was opposition to Bill C-91 which hit the consumer with increased drug prices for provinces and territories and the federal health care plans. Does this Minister of Health want to save Canada's health care plan and if so, will her government rescind Bill C-91?
Diane Marleau LiberalMinister of Health
Mr. Speaker, there were a number of questions there. I do not know which one to start with.
First, the Prime Minister stated that we must preserve the principles of medicare that were put in place by the federal government many years ago. We have to effectively and efficiently spend our dollars in order to guarantee those principles.
Second, the report that came out today definitely concerns the increase in terms of usage of newer drugs, not necessarily just an increase in prices.
Again, we must look to ensure that the drugs we use are the most cost effective.
Bill C-91Oral Question Period
The Speaker
Order. I would hope that we will continue as we have since the beginning of this Parliament and have the courtesy of not only listening to the question, but also having the courtesy to listen to the answers.
Jim Silye Reform Calgary Centre, AB
Mr. Speaker, I rise on a point of order under Standing Order 37. I believe the question I was asking was fully in order. Yet the Speaker-
Points Of OrderOral Question Period
The Speaker
Order. I would advise my hon. colleague with all respect that in the view of the Chair the question he posed was out of order. I asked him to rephrase it.
If the hon. member would care to pursue this he can either address himself to the clerks for the specific rule in question or I would invite him to speak with me in my chambers. This point is closed.
The House resumed consideration of the motion.
SupplyGovernment Orders
The Acting Speaker (Mr. Kilger)
The Parliamentary Secretary to the Minister of Industry had approximately six minutes left on questions and comments.
Are there any further questions or comments for the parliamentary secretary?
Dennis Mills LiberalParliamentary Secretary to Minister of Industry
Mr. Speaker, I appreciate the fact that you have acknowledged I had some time left in answering the question from the Reform Party.
The question had to do with the comparison the Reform Party tries to make quite often that running a government is very much like running a business. Of course I do not agree that running the Government of Canada is like running a business at all.
The member said we should have had a pretty good idea when we took power about what was happening with the books and records of the country. The member knows that when we took
over the books and records, there was close to a seven or eight billion dollar difference in the real numbers.
I really believe the Reform Party should acknowledge that. It should likewise acknowledge that our very aggressive handling of the deficit and the debt is something for which we should be given some marks.
Richard Bélisle Bloc La Prairie, QC
Mr. Speaker, I rise today to speak to the motion tabled in this House by my colleague from Saint-Albert. The hon. member for Saint-Albert sits on the Public Accounts Committee, which I chair, and I want to let him know that I share his point of view on the sorry state of our public finances and on the finance minister's inability to resolve Canada's public finance crisis.
I also agree with him that the government should table in this House a detailed plan to show how it intends to balance the budget as well as its action plan schedule. The Bloc Quebecois, however, does not agree with the ways advocated by the Reform Party to balance the budget. The Bloc Quebecois does not share Reform members' vision of the role government should play in the economy either.
In our opinion, the government must not only create a healthy competitive climate encouraging people to develop skills and do their best, but also protect society's poorest and most vulnerable and help them get out of the vicious circle of poverty and dependency. Where are we as taxpayers today, a year to the day after the election of a Liberal government? The two papers tabled last week by the Minister of Finance simply note the deterioration of Canada's public finances.
The minister merely describes the state of government expenditures and revenue without proposing any vigorous action plan to correct the situation and substantially reduce the deficit. Yet, the red book, which all ministers misquote almost daily to save face in response to the questions asked by the Official Opposition during Question Period, contains many promises, and I quote: "The basic elements of our approach include fiscal responsibility and fairness, deficit reduction, and a balanced and stable monetary policy".
The deficit forecast for this year is still close to $40 billion, more precisely $39.7 billion, while the forecast for next year is $32.7 billion. Even if the Liberal government met its target of reducing the deficit to $25 billion in 1996 and 1997, it would add $97.4 billion, almost $100 billion, to the $500 billion-plus debt already accumulated.
Even if the government met its goal of 3 per cent of GDP in 1996-97, it would still raise the debt to over $600 billion. Is that the deficit reduction promised by the Liberals in the red book? It is more and more unlikely that the government will succeed in keeping the deficit below the $40 billion level this year and below $33 billion next year.
The government recognizes at last, but a bit late, that the increase in interest rates, which was partly offset by the recovery this year, will entail additional cuts of up to $4.7 billion in 1995-96 and $9 billion the following year if it is to reach its objective of a deficit of no more than 3 per cent of the GDP before the end of its term.
Can we honestly talk about fiscal responsibility as the government promised in the red book? According to us, it looks more like chronic irresponsibility. In such a context, the red book looks more and more like a jumble of wishful thinking prepared just to seduce some disillusioned constituents throughout the election campaign. In that same red book, they also talked about fiscal equity.
Well, let us talk about it. The government's budgetary approach is based on the social security reform, that is on cutbacks in transfers to provinces and in social programs that will merely penalize welfare recipients and students, the unemployed and the elderly. The overtaxed middle class, which historically served as the milking cow for government taxation, is not reassured when even the Prime Minister talks about a possible hike in taxes, as opposed to what he promised during last year's campaign, and when the Minister of Finance is juggling with the idea of taxing RRSPs.
Naturally, this government lacks imagination in the fiscal area as in all other areas of management. They also promised a stable and balanced monetary policy. Interest rates have increased since spring and should increase some more during the coming months because you have to reduce the deficit if you want to relieve the upward pressure on interest rates and give more flexibility to the Bank of Canada so that it can, in turn, lower interest rates. So goes the vicious circle of indebtedness.
We in the Bloc Quebecois agree that government finances must be overhauled to reduce the risk premium Canada pays on interest rates, mainly on foreign loans. The government's budget policies should aim for a far more substantial reduction in the federal deficit. The Liberals are not on the right track and will not be able to keep their campaign promise of a balanced and stable monetary policy.
The red book says, and I quote: "A number of government programs and tax expenditures-some of which have been identified by the auditor general-are inefficient, poorly managed, or motivated by purely economic reasons. Just as we are proposing new measures to grow the economy, we will examine such programs with the objective of reducing waste and inefficiency and promoting economic growth. Expenditure reductions will be achieved by cancelling unnecessary programs, stream-
lining processes, and eliminating duplication. This effort will take place in partnership with provincial governments".
How ridiculous this sounds when we read it again today, a year after the Liberals came to power. Ridiculous, especially when we compare the red book with the two instruction manuals it spawned last week: A New Framework for Economic Policy and Creating a Healthy Fiscal Climate . Upon reading these two documents, which list a set of principles and indulge in a lot of wishful thinking and which are to be used for consultation purposes, we realize that, for the government, social security reform remains the cornerstone of deficit reduction and of improving the state of government finances.
According to the Minister of Finance, improving the state of government finances will be achieved, as we said earlier, through cuts in unemployment insurance, student loans and social security. The jobs and growth strategy, says the minister, is based on the following main themes: encouraging Canadians to adapt to change; rethinking the role of the state; putting the economy on the right track; and creating a healthy fiscal and monetary climate by reducing the deficit to 3 per cent of GSP by 1996-97, the ultimate objective being to balance the budget.
Aside from a few very general principles, the government's new policy framework merely reminds us once again of the red book's objective which is still to reduce the deficit to 3 per cent of GDP before the end of the government's mandate. There are no concrete proposals for meeting this objective, aside from a number of haphazard budget cuts.
Given the sorry state of Canada's finances and the resulting prohibitive foreign debt, the Liberals' target of $39.7 billion in 1994-1995, again barely under the $40 billion mark despite the strong economic recovery, strikes the Bloc Quebecois as overly cautious and irresponsible in view of the size of the problem.
In order to point up the reduction in the deficit, you will recall that the Liberals overestimated the deficit in 1993-1994, the last year the Conservatives were in power, at $45.7 billion. The real deficit that year, however, was $42 billion. Without a change in policy, the government told us, the projected deficit that year would have been $41.2 billion. In our view, the minister's deficit reduction objective is still not high enough.
In a context of economic recovery, with Canadians willing to do their part, what kind of leadership is it to lower the deficit from $41.2 billion to $39.7 billion? This is a paltry $1.5 billion-it is laughable, really. The minister is not even certain that his timid attempts to improve the situation will achieve their purpose. As he told us last week, these two documents will be submitted for consultation. I, for one, have always believed that the government was elected to make decisions and to manage. The Liberals are trying to change the art of governing. For them, it seems to mean consulting.
Not only has it set its sights too low, but the Liberal government is erratic and hesitant when it comes to specific measures to eliminate an uncontrolled debt that has become uncontrollable under their leadership.
To reduce the deficit, the government must find enough manoeuvring room to meet its budget goals, which we find, as I said earlier, a little too ambitious based on the following measures. The government promised to tackle waste, duplication and mismanagement in order to reduce operating expenditures. Yet, year after year, the Auditor General finds numerous cases of waste and mismanagement. Many of his recommendations are not acted on. What about program assessment? Program expenditures now exceed $120 billion, while most federal programs evaluated cost less than $250 million.
No large-scale program has been evaluated yet, either in government departments or Crown corporations. On what basis and under what criteria will the minister responsible for reviewing all government programs conduct the promised review? Will this review integrate the Auditor General's recommendations? We do not know any more than that.
You will agree with me that the measures proposed by the Minister of Finance to create a healthy financial climate are not exactly innovative and ambitious. As the Bloc Quebecois already said, the minister only describes the government's balance sheet without proposing any concrete measure to reduce the deficit.
The reform of social programs remains this government's framework to reduce the government deficit. Although the government made a commitment not to increase taxes, the minister says in the document that "broadening the tax base is preferable to raising tax rates". What does this position mean for the future?
In the same document the minister says that given the scope of the measures needed to meet its deficit-reduction goals, the government must contemplate tax initiatives. This means that we must expect new tax increases at some point.
Tax breaks on retirement savings, or RRSPs, represent almost $15 billion, $14.9 billion to be more precise. The Liberal government must be tempted to eliminate RRSP deductions, which would reduce its annual deficit by 37 per cent in one fell swoop, without any additional streamlining effort. RRSPs account for 55 per cent of all the government's tax expenditures including the credit for charitable donations, the tax credit for research and development, the exemption for injured workers' compensation, and the largest, making up 55 per cent of the total, is RRSPs. How tempting to eliminate just one, that one, which would affect only one group of taxpayers. Only one group of taxpayers would be targeted and in one fell swoop more than half the tax expenditures would be eliminated.
The government is preparing us for this type of cut that will affect mainly the middle class. When he says that he must consider tax initiatives, the minister is surely thinking of RRSPs.
No offence to the member for St. Albert, with whom I agree, but the government has no detailed plan on how to balance the budget and will not table such a plan, nor does it have a timetable and a clear vision of the government's role in the economy.
To conclude, I will add that this government does not seem to want to keep its commitment not to raise taxes, it is vacillating and only as a last resort did it admit that it had to make more cuts to achieve its future budget objectives.
This government prefers to re-examine government programs instead of tackling the machinery of government as such. This government promised us "jobs, jobs, jobs" in the 1993 election campaign. Today, it tells us only about cuts and reducing the deficit. Its rhetoric varies depending on the prevailing circumstances, you will agree.
This government observes and consults. It gives the people no concrete measures except for cuts in social programs and in transfers to the provinces. It is counting on the economic recovery in order to avoid making painful decisions, which will be even more painful because of its indecision.
This government no doubt has a work plan that it is developing in secret while its leading lights consult left and right. Even the Prime Minister is consulting the health stakeholders to define the health care system for the next century in the absence of the provincial premiers and health ministers.
In the end, the Toronto Star 's allegations are being confirmed: the shortfall of the next two fiscal years will be recovered through made up for with cuts in social programs. That is what this government's political agenda boils down to. I believe that Quebecers and Canadians deserve better.
Jean-Guy Chrétien Bloc Frontenac, QC
Mr. Speaker, I listened very carefully to the interesting comments made by my distinguished colleague, the hon. member for La Prairie. I want to ask him if he finds it normal that a government running a country on the verge of bankruptcy tolerate having accounts receivable of $6.4 billion and a revenue minister who does not do much to recover that amount?
Does the hon. member finds it reasonable that a government on the verge of bankruptcy play war games and spend $2 million in just 48 hours?
Does he find it reasonable that the parliamentary restaurant, on the sixth floor of this building, incurred losses of $2 million last year presumably because its clients, including senators and others, would leave without paying their bills?
Does he find it reasonable that a government running a country on the verge of bankruptcy would have an agency such as the CSE, which has over 1,000 employees and an annual budget of 250 to 260 million dollars? These people are not all spies but, seemingly, several of them are.
Does the hon. member find it normal that this same government accept the fact that large amounts of money in family trusts are exempt of normal taxes?
Since my colleague used to be an alderman in his home town, I also want to ask him if he agrees that the federal government should follow the example of municipalities and table a balanced budget? If the government insists on playing Santa Claus, it should not do so at the expense of future generations. Instead, it should have the courage to raise taxes. It is easy to be generous when you know that it is the third or fourth generation down the line which will have to pay for the goodies handed out now.
Finally, does he find it normal that a government borrow, often from foreign countries, to pay the interest on the deficit for the current year?
There are several questions. I would appreciate it if the hon. member for La Prairie could answer most of them.
Richard Bélisle Bloc La Prairie, QC
Mr. Speaker, I want to thank my friend from the Bloc Quebecois for this array of very relevant questions.
First, I would like to tell you that I agree completely with what you said, especially concerning the accounts payable. Naturally, the Canadian government was often compared to a business; thank God it is not a private business, because if it were, either a small, a medium-sized or a large business, it would have gone bankrupt a long time ago.
What you said about the accounts payable is also true for the accounts receivable. How many millions if not billions of dollars in taxes are not collected by the Canadian government? As Chairman of the Standing Committee on Public Accounts, I can say that our committee has the opportunity to analyze the recommendations made by the auditor general. Year in and year out, the Auditor General says the Canadian government lacks rigour in the collection of accounts receivable, meaning taxes, as well as in the area of accounts payable.
You talked earlier of the restaurants here, on the Parliament Hill. Recently, I read that these restaurants do not even make enough money to pay their staff. This is absolutely absurd. Basically, this is a sign of the laxness that the Canadian government has been guilty of for many years. In previous years, in collective bargaining, the Canadian government, as an employer, never stood up to the labour unions. And we are now
in the absurd situation where the revenues of the restaurants do not even cover their manpower costs. The restaurants on the Hill do not even make enough money to cover the fixed costs, let alone the variable costs.
You also talked about the $2 million it costs the Canadian government to play war for 48 hours. You were surely alluding to the William Tell competition that was mentioned here last week. Clearly, the whole defense policy must be reviewed. The Department of National Defence has a $12 billion budget. We have seen the government try to close bases here and there in Canada. That is not the Bloc's position. We think that the defence budget should be reduced by at least 25 per cent, which represents about $3 billion. The government just has to say no to these war games and to other decisions made by the generals. We know that, historically, in Canada, as in the United States and many other countries, oftentimes it is not the Minister or the Prime Minister who runs the Department of National Defence but the generals.
When the generals submit their budgetary requirements each year, they ask for a lot of what I would call military hardware to play war games. As far as I know, the Second World War ended in 1945. It is true that Canada was involved in the Korean War. It is also true that we have sent troops to several countries as part of a multinational force in the 1970s, the 1980s and the 1990s, but I do not think that it justifies a $12 billion budget today. It is us, taxpayers, who have been paying year after year for this military hardware to please the generals and other army leaders. I think the time has come for the civilians to regain control of this $12 billion defence budget.
Richard Bélisle Bloc La Prairie, QC
Municipalities, yes, I certainly agree with you, since I was a municipal councillor for 11 years in Ville Saint-Lambert, in my riding, on the South Shore of Montreal. They never had a deficit in Saint-Lambert or in any of the neighbouring towns or anywhere in Quebec, for that matter. If a town runs a deficit in one year, the deficit is transferred to the following year's budget. If this principle were applied by the federal government, it would not have a $500 billion deficit today.