House of Commons Hansard #104 of the 35th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was children.


Department Of Public Works And Government Services ActGovernment Orders

5:05 p.m.


Shaughnessy Cohen Liberal Windsor—St. Clair, ON

Mr. Speaker, it is true it has been almost a year. October 25 will be our first anniversary. During that period we have had an opportunity to assess and to see the precise situation in which the government has found itself.

The full integration of this department will result in savings of $180 million and 4,000 full time equivalent jobs between the 1993-94 fiscal year and 1997-98 representing a reduction of about 25 per cent of the current complement.

The emphasis is on reducing overhead through streamlining and eliminating duplication. These targets will not affect the delivery of services but will result in savings of $1 billion over the next few years. This is not chicken feed. It is a lot of money. I am very sorry if we did not do it as quickly as the other side of the House would like.

Everything is simple over there. Somehow you give people guns and they will not shoot each other any more. We will have law and order. Knock 20 per cent off the budget and people starve in the streets and I guess we do not have as many people to feed. That is a very simple view.

Over here where the responsible people live, we can say that we have studied it, we have looked at it and it has only just begun.

Department Of Public Works And Government Services ActGovernment Orders

5:05 p.m.


Michel Bellehumeur Bloc Berthier—Montcalm, QC

Mr. Speaker, it gives me pleasure today to speak to Bill C-52, an act to establish the Department of Public Works and Government Services and to amend and repeal certain acts. My colleagues and I in the Bloc Quebecois think that the Liberal government has missed yet another golden opportunity to honour its pontifical promise to make our political institutions transparent.

After the Pearson affair-I think you would do well to listen-and Bill C-43 on registration of lobbyists, now the Liberal government confirms its lack of transparency with Bill C-52.

I have a problem with the bill not because I am against the principle of integrating two departments, but because the bill does not go far enough. Although I have been sitting in this House less than a year, I have enough parliamentary experience to see that such a bill should really go further. Allow me to explain.

It is important that our legislation in this area be stringent. About two weeks ago, I received from the Minister of Public Works a reply to a letter I had written, asking him for information on his department's activities in Berthier-Montcalm. Having been elected in this riding, I wanted to know what was going on there, who was being awarded contracts, whether there was waste, news on buildings and so on.

This request for information from a member of Parliament was entirely legitimate. I will simply read you a short paragraph from the minister's reply. He wrote: "Unfortunately, the information you are looking for is not contained in any one document". To provide you with an answer would require intensive research in the many and varied branches of my department as well as in multiple data banks, the number of which has increased considerably since four separate entities have been merged to form the new Department of Publics Works and Government Services Canada. Moreover, the costs associated with information retrieval and the preparation of reports for members of Parliament could exceed $168,000, and a large part of the work is not computerized. All in all, this task would put an excessive load on the operation of our department".

I wonder, and would it not be ironic if it were the case, if the minister based his calculations on his own hourly rate and add on computer time to get this $168,000 figure. The acme of this department's inconsistency was reached on April 18, when my hon. colleague the member for Laval East received her response to a letter she had sent to the same department asking for a list of names, addresses and phone numbers of businesses located in her riding. In response to that letter, the minister made no reference to the fact that her inquiry would cost $168,000 or some other amount to the taxpayers. He did not say that answering her inquiry would prove impossible because of the number of documents that would need to be analyzed before an answer could be provided to the hon. member.

Nothing of the sort. The minister wrote back stating that the information she had requested was attached. I asked myself whether his department had double standards. Information considered as not overly compromising and of no consequence is released, while the rest is not. I sure hope this is not the case. At any rate, the hon. members opposite who sit on the industry sub-committee on Bill C-43, the lobbyists registration bill, tell me that members of Parliament make the best lobbyists when it comes to obtaining this kind of information.

I note however that this statement does not apply to ministers. I wonder if Government Policy Consultants would not charge less than $168,000 to provide me with an answer to my question. Moreover, I think that an in-depth analysis of certain aspects of the answer received from the department on September 21 is essential. The minister responsible for Supply and Services Canada says that the information I am requesting does not appear in a document per se. Where can the information be found then?

I will give you a few hints. These answers may be in the data bank of some lobby groups very familiar with Parliament Hill. These lobbyists make thousands of dollars a day-up to $10,000 a day in some cases-to advise companies hoping for government contracts. As my colleague from Québec-Est proposed a few days ago, if Public Works and Government Services Canada were to issue monthly reports guaranteeing the federal government's openness in awarding contracts, we could probably, in the long term, save a lot of money and eliminate patronage in that department.

If lobby groups make so much money giving advice and explaining how the system and its institutions work, it is because the system is very complex and not open enough. The members opposite and the minister himself will tell me that merging the Department of Public Works with Supply and Services will simplify things, but I say that Bill C-52 does not provide for any mechanism that would open up that department. Furthermore, this bill will not encourage public servants to denounce cases of shameless waste at the future Department of Public Works and Government Services.

It is not normal that, in 1994, people and the members who represent them are not informed of that department's contracting-out activities in their own ridings. Openness in that depart-

ment appears to be a fine source of patronage. In any case, that is what my grandmother would say in such a situation.

In the red book, the word "openness" appears almost as often as the word "employment"; it is surprising that it is nowhere to be found in Bill C-52, and it is not in Bill C-43 either.

Legislators must look at the goal of openness as a whole. The government's right hand must know what the left hand is doing. Yet, in the red book, they talk about the citizens' confidence in the system, the undue influence of lobbyists; they talk about openness, the sacrosanct integrity, involvement, etc. The red book should not be quoted just for wishful thinking. We need an appropriate legislative policy. Now is the time to take action while we have a bill before us.

Why make laws amounting to half-measures? Bills C-52 and C-43 as they now stand are cases in point and deal with two closely related subjects. There should be a legislative link between the two. Government contracts, procurement and buildings automatically remind us of lobbyists. The Bloc is probably the only party in this House to see that link. But it is there!

The Pearson affair, which this House is very familiar with, shows what happens when you mix government contracts with lobbyists' pressure. Will we prevent similar situations with Bill C-52 before us today or Bill C-43? No, Mr. Speaker, not the way these two bills are now written.

Laws are supposed to mean something and not be just rhetoric, so a law should be passed to change things and not just to put up a smoke screen to hide shameless patronage, like what has been going on in those departments for decades.

Something else that would contribute to the much-desired openness, which is just wishful thinking on the part of the government, could be a reality or well on the way to becoming reality if the financing of political parties was reformed as suggested by the Bloc Quebecois member for Richelieu. But no, we saw the government's true face. It refused the hand that we extended to it on this issue.

Although we could say more about the pretense of openness desired by the government, I will return to Bill C-52 and probably we will have a chance later to talk about this famous openness that the government would like to have. However, it never acts openly when it has the chance.

What we refuse to do is to give second reading to Bill C-52 because the principle of the bill does not provide for a precise code of ethics to make the contracting process transparent and to show how the Department of Public Works and Government Services acquires all the goods and services.

For this purpose, we propose five things that would provide a basis for obtaining this desired transparency. The Bloc's five proposals are as follows: one, create a public supervisory commission; two, a code for contracting out; three, consult all federal MPs; four, make public servants accountable; and five, control advance payments by the government.

Sometimes I hear ministers say that the opposition never makes any proposals. Well, here I am making proposals. Besides, we often make proposals but you do not listen to them. I am giving you some very clear proposals and I will explain them.

Let us take a closer look at these proposals. The first one is to create a public supervisory commission. Among other things, this commission would submit monthly reports on all government contracts that go through the department. With such a system, the frustrating delays currently experienced with requests submitted to the minister under the Access to Information Act would be avoided. These periodic reports would help streamline government operations. This would be a simple, accessible and understandable process.

Finally, this public supervisory commission would have the power to question any vague or obscure contract violating the applicable rules of procedure. This judicial power could also be used in cases of influence-peddling or patronage.

Also, the proposed code for contracting out takes into account the fact that this activity represented a $5.2 billion market for the year 1992-93 alone. Such an important economic sector must be subjected to some government guidelines.

This issue is too important for civil servants, trade contracting firms, as well as Canadians and Quebecers to be taken lightly. In that regard, the Bloc would have liked the bill to set rules, or at least a legal framework compelling the federal government to adhere to specific standards regarding contracting out activities. If the government is prepared to do it for the lobbying industry, which is not a $5.2 billion market, it can also do it for the contracting out sector.

Canadians, unions and management could only win if there were specific rules in that sector. And do not try to tell me that contracting out is a cyclical thing. When such a practice has been in use for ten years, it is there to stay.

I would like it if someone could tell me why parliamentary committees use private printing companies to publish their reports when that service is provided here in the House of Commons.

Then there is the consultation of federal MPs. I believe we are here to represent our constituents. We could be asked to do more, and that would be a good thing. As a third element for transparency, the Bloc Quebecois suggests that all federal members of Parliament should be consulted. This proposal is based on the Liberal commitment to enhance the role of members of Parliament. Hence, it is important to give more responsibilities to members of Parliament and to inform them of the contracts placed by the new department in their ridings. Such consultation outside the House of Commons will provide

members of Parliament the opportunity to monitor and confirm the impact of the bills on which they voted.

Consequently, members of Parliament will not be consulted only in the House of Commons or in parliamentary committees. I was democratically elected to represent the people of my riding of Berthier-Montcalm and I must have all the necessary tools to fulfil my mandate. Information on public spending is one of these tools. How can members of Parliament play their roles adequately if they are not even aware of all government expenditures in their own ridings? Cleanliness starts at home, as we say, but when you do not know what to clean, it is hard to look clean to the public.

I reject the argument used by the minister who claimed that it would cost too much, because I think if members of Parliament were to closely monitor what is going on in their ridings, they could surely find some waste to eliminate. We could quickly come up with the money required to provide this information to members.

Fourth, accountability for public servants. This would be important. Public servants must be responsible and feel accountable to Parliament. We must clearly give more responsibilities to civil servants. No one is in a better position to expose all the awful waste occurring in federal departments. We have to find ways to encourage public servants to denounce such extravagant spending by the government. The right to expose public waste must be addressed by this House and very soon at that.

Since most contracts will be executed by the Department of Public Works and Government Services, it seems to me that Bill C-52 should have covered this issue.

Federal public servants must realize that, as taxpayers, they also pay for unnecessary spending they are aware of.

Here is a good example to justify the cleaning up, which, as I said earlier, should start at home.

I invite the Minister of Public Works and Government Services to visit the back entrance to the Confederation Building to see for himself what is an immoral spending.

Public Works rebuilt the access ramp for handicapped people. Although I completely agree with the principle, I am outraged with the end result. Instead of a simple efficient and functional slope, the contractors have created a huge labyrinth not accessible by wheelchair. Moreover, I am told this non-functional labyrinth cost $170,000.

That shows how some expenses are fit for a transcendental world.

Finally, I would like to say a few words about advance payments by the government. The purpose of this practice by senior officials is to make maximum use of the resources available to a function within a department in order to ensure that the same level of resources will be allocated to that function in the next budget year. Government officials do this because they are afraid of having their annual budget cut if they do not use all the resources available to them in the current year.

The whole issue of advance payments concerns all departments. Moreover, it becomes clear that the Department of Public Works must take the bull by the horns and exert strict control over government expenditures.

While Public Works and Supply and Services have historically been considered the ideal departments for patronage, the new department must now do everything it can to become the department of transparency, and it has to have all the necessary tools to be able to do that.

Again, the Liberal government is watering down this objective and, in this particular case, it is drowning it. Instead of being a watchdog as it should, the Department of Public Works and Government Services is playing an unhealthy game that prevents it from being as transparent as we would like it to be.

Another example that I find appalling concerns some electricians from Public Works Canada. I was outraged when this information was made known to me. It would appear that some electricians keep the copper from the electric wires that they dispose of, melt it and then sell it to pay for the big party they throw at the end of the year. I think this kind of practice is unacceptable in 1994.

Another quick example, Mr. Speaker, because I see that time is running out-

Department Of Public Works And Government Services ActGovernment Orders

5:25 p.m.


Ronald J. Duhamel Liberal St. Boniface, MB

I want to ask a question.

Department Of Public Works And Government Services ActGovernment Orders

5:25 p.m.


Michel Bellehumeur Bloc Berthier—Montcalm, QC

I will be glad to answer your questions, if I have the time.

The other point I would like to mention concerns something I noticed when I moved into my new office in Ottawa. My 286 and 386 computers were replaced by more efficient and modern systems. In my riding, I have a number of community organizations, women's groups, youth organizations and other groups. They had asked me how to go about buying those old computers from the Canadian government. It is quite difficult, as I found out. It seems that those computers are auctioned off, but that they end up being bought by employees in some departments or their relatives and friends. As a result, taxpayers and community agencies across Canada who would need those computers and

could pay a good price, much to the benefit of the government, never even get a chance.

The reasoned amendment moved by the Bloc Quebecois truly reflects the need for that greater openness all taxpayers in Quebec and the rest of Canada would like to see in that department, which has always been considered the mainstay of patronage under Liberal, Conservative, and other governments alike.

The time has come to put an end to such practices. We should pass appropriate legislation so that openness, and not patronage, prevails in that department. Since past deeds speak to the future, it is sure to remain the patronage department, if this bill is passed. This has to stop. I ask my colleagues on the government side to urge the minister to pay attention to the Official Opposition's point of view.

I will now take my seat so that my colleague from Saint-Boniface can put the question he so badly wants to ask.

Income Tax ActPrivate Members' Business

5:30 p.m.


Paul Szabo Liberal Mississauga South, ON

moved that Bill C-256, an act to amend the Income Tax Act (transfer of income to spouse), be read the second time and referred to a committee.

Mr. Speaker, I am pleased to rise in the House of Commons to present for debate at second reading my private member's bill, C-256.

Every member of Parliament looks forward to an opportunity to bring before the House matters of importance not only to themselves but to all Canadians. Bill C-256 is a proposal which is foremost about the family and which also has implications for jobs, child care, tax equity and the cost of health, social services and criminal justice.

The United Nations General Assembly has proclaimed 1994 as the International Year of the Family. However, in my view this is not as much a celebration as it is a warning.

In the last 30 years changes in our social and economic environment have been dramatic. Family and social values have clearly eroded. We no longer feel safe in our communities. Demand for social services has expanded beyond our means and family breakdown has become the norm. Everyone knows a lone parent, but did you know that 60 per cent of them are living in poverty?

In 1961, 65 per cent of families with children under six years old had one stay at home parent. In 1991, 30 years later, this type of family structure accounted for only 12 per cent of families. In addition, today more than 70 per cent of preschool children are now in non-parental care arrangements on a regular basis while parents work.

Much of this movement has been caused by economic circumstances. Growth in incomes has been stagnating in real terms since the mid 1970s and younger families have been hit the hardest. Their incomes are in dramatic decline and the incidence of poverty is increasing. For example, among families with a head under age 25 the incidence of poverty nearly doubled from 21 per cent to 37 per cent between 1981 and 1991.

I am therefore extremely pleased that today the Minister for Human Resources Development reaffirmed our commitment to the elimination of child poverty. He has clearly stated that this is our top priority in the restructuring of our social programs.

It should be noted however that as personal home parenting becomes increasingly uneconomic, it is being portrayed as decreasingly desirable. Instead of recognizing that there may be problems with our priorities, we somehow rationalize that the choice is best for the children.

In addition, there are a number of other contributing factors to the family and social ills we are experiencing today. We appear to have designed most of our services to kick in after problems become apparent. By then the need to respond is urgent but the remedial efforts are often unsuccessful.

According to the May 1994 report of the Ontario premier's council on health, well-being and social justice, critical development outcomes are rooted in early experiences and influences. These outcomes include good physical health, the ability to learn, the ability to cope with stress, being able to relate well with others and to have a positive self-esteem.

Where, how and with whom children spend their time in the early years has a major impact on their healthy development. A secure attachment to a nurturing adult is essential and who is better than one of the parents to provide that care.

Dr. Fraser Mustard, chair of the Canadian Institute for Advanced Research, has long advocated focusing some of our limited resources to children in the first three years of life. Their extensive research shows dramatic links between future problems and poor child care during infancy.

Dr. Mustard cites a 19 year study of early childhood enrichment in the United States. As a result, the group of children had a higher proportion who graduated from high school and went on to college. There was a 50 per cent lower incidence of mental health problems, 40 per cent fewer on welfare, and there were 50 per cent fewer teenage pregnancies.

Dr. Penelope Leach, renowned author on child care, masterfully stated the case when she said: "The real issue is not motherhood or career, but something closer to parenthood and paid work". Today, children are more a part of paid work than of home life. As such, they are currently of secondary importance in our society. Those priorities will have to shift.

The critical importance of quality child care is particularly dramatized by the facts related to young unmarried mothers. Each year over 20,000 unmarried women aged 12 to 19 give birth with the majority choosing to raise the children themselves. As a result, most do not finish their education and are likely to become dependent on subsidized housing and welfare. Their offspring are at a higher risk of being premature or low birth weight, more likely to experience difficulty in school, and more likely to become single parents themselves.

These facts raise serious questions. What has become of the traditional family? Are we fully aware of the potential consequences to our children's future development by having both parents work? Is it really up to governments to take the responsibility for the future development of our children? Has society decided that managing the family home and caring for preschool children is no longer important?

Who would dare say that a stay at home parent does not work? A parent working in the home has chosen a very honourable profession which contributes more to the quality of our society than most jobs. Yet it is a profession which is not specifically compensated in recognition of the value of the work done. That is the reason why I have tabled this bill. It is an attempt to provide a modest financial benefit to families who choose to have one parent work in the home and care for preschool children.

As a consequence of the bill, jobs in the external work force would be freed up for those who urgently need them. In addition, child care spaces would be freed up to partially address the critical shortage we are now experiencing.

Take the example of two working parents with two children in day care with the lower income earning spouse earning $25,000. After income tax, child care expenses and the cost of employment, the net take home pay is less than $100 per week.

Parents in this situation often question why they are sacrificing so much for so little. Their lives are driven by a child care schedule. They rush in the morning to get their child ready, they rush to deliver the children to day care, they rush to work to put in a full day and they cannot delay leaving work because the children must be picked up and taken home to be fed dinner. By the time they settle in the home, it is time to get the children ready for bed. Parents may want to spend family time with children but often it is the case that the children are too tired or not in the mood to play when the parents have the time.

What do parents do when their children are sick? That much stress cannot be helping the family unit. The amount of time that parents and children spend together has dropped by 40 per cent in a single generation. As a rationalization we dreamed up the notion of quality time. However, that implies that to spend a small amount of time with a child is satisfactory if it is quality time whereas if you are around the child all of the time only some of that time is quality time. That kind of thinking is simply flawed.

Economic considerations are important, but in certain circumstances parents are struggling to decide whether the modest take home pay of the lower income earning spouse is worth all the family sacrifices they are making. Although the vast majority of parents do work, a 1991 Decima poll found that 70 per cent of women would choose to provide direct parental care if they could. This bill would provide a financial bridge to assist those parents, and I stress, who would like the option to make that choice.

It should also be noted that our present income tax system in fact discriminates against one income families. The child care expense deduction permits two income families to claim up to $5,000 of child care costs per child under the age of seven regardless of how much income they have. No such deduction is available to one income families due to the false assumption that they have no child care costs.

Child care costs exist not because both spouses work but rather because children exist. The child care expense deduction has an inverse relationship to need. That means that the higher the family income, the higher the savings to the two income family.

Consider also the case where two neighbours each have children. One neighbour can be paid to take care of the children of the other neighbour and vice versa. Each family then gets to claim the child care expense deduction because they care for each other's children. Ironically, however, you do not get any deduction when you care for your own children. This favoured tax treatment may produce financial savings for those who care for the children of others but it does nothing for those who care for their own children.

The child care expense deduction should be means tested and extended to all families to address the profound inequities in our Income Tax Act. This initiative would provide equitable benefits to all families based on financial need. Accordingly, I will

shortly be tabling in the House a motion to effect this change and I hope it will have the support of all hon. members.

Bill C-256 specifically seeks to amend the Income Tax Act to permit one spouse to split up to $25,000 of their income with the spouse working in the home and caring for at least one dependent child who has not commenced full time attendance at school.

As a result of the graduated tax brackets presently in our income tax laws, this would result in a lower tax burden on family income. Depending on the level of incomes and deductions the benefit could be as much as $3,500 per year or about $65 per week.

In the example I cited if instead of forgoing $100 per week of net take home pay it were reduced to only $35 per week the option to have one parent work in the home would be much more attractive to the family. The income split with the spouse working in the home would be treated as self-employed income and as such would not be eligible for unemployment insurance. The income would however qualify for the purchase of RRSPs.

Under the Canada Pension Plan Act this income would not qualify for CPP benefits. I have however tabled in the House Bill C-269 which would change the CPP act to make such earnings pensionable. That change will require approval of two-thirds of the provinces representing 50 per cent of the population, plus Quebec which operates its own Quebec pension plan.

If we truly believe that working in the home and caring for preschool children is an important job, should we also not acknowledge the fairness of providing pension benefits?

The benefits of this bill do not stop there however. This is not just a bill which would give a tax break to some Canadians. If a lower income earner withdraws from the external workforce to work in the home, a job would be freed up or created depending on how we looked at it. With 10.7 per cent of our workforce unemployed the importance of job creation cannot be overstated.

Furthermore the person filling the vacated job will likely have been on UI which can be up to $429 a week, or on welfare which can be up to $663 per week. Under these circumstances the government will in fact be saving on the cost of these social benefits. As well the new taxpayer would not likely have the same level of child care expenses, which means that more tax would be paid by the person on the same job than by the person who formerly held that job.

A further consequence of the bill is the freeing up of child care spaces. In its red book the government has committed to create 50,000 child care spaces per year for three years following the achievement of 3 per cent growth in GDP. Since that growth will be reached this year these 150,000 spaces will be created at a cost of $1.4 billion split between the federal and provincial governments. That represents $9,600 per space per year.

It is also expected that the users will pay $2,400 per year for the space. Therefore, in total each of these spaces will cost $12,000. That is a fair indicator of just how much value should be attributed to caring for a child in the home.

While it is certainly true that more day care provision would increase the number of mothers in the external workforce, it is also true that more financial help with the costs of being a parent would reduce that number no matter how much affordable day care was available. In the long term it is crucial for us to realize that direct parental care will also contribute to savings in the areas of health, social programs and criminal justice.

Each year it costs literally billions of dollars to respond to the problems rooted in poor child development. Today we face serious challenges related to the family which are complex. We must however remember that there are no simple solutions. We need a range of initiatives spanning both preventive and remedial approaches. Bill C-256 represents an important preventive approach which recognizes the value of work in the home, creates jobs and provides child care spaces.

Since introduction of the bill over 160 members of Parliament have indicated their support for having the bill referred to committee. In addition, thousands of Canadians across the country have told us through letters and petitions that they want to see the subject matter of the bill pursued.

In the year of the family I believe the House of Commons should embrace every possible opportunity to examine initiatives which may help Canadian families to raise our children who are of course our future.

Private members' bills require unanimous consent of the House at second reading in order to proceed to the next stage. Such consent is very rarely achieved but the value of the process is the extensive dialogue generated not only in the House but also among Canadians interested in the subject matter.

This morning I had the opportunity to speak with the Minister of Human Resources Development about the issue of benefits for those who give care. I have his assurance that the subject matter of Bill C-256 can be addressed as part of the review of the social programs outlined in his discussion paper tabled today in the House of Commons. This will allow a broader consideration of the issues and the options to Bill C-256.

One such option to spousal income splitting is the creation of a caregiver tax credit which would be available to those Canadians who provide care directly rather than relying on extensive social services. Caregivers would include those who care for preschool children in the home or who care for the disabled, the chronically ill, or seniors requiring continuous care. These

Canadians have put their family members first, ahead of their own interests, and they should be recognized.

I am grateful for the opportunity to continue the fight on behalf of parents and all caregivers who provide care in the home. The dialogue has just begun. I thank all hon. members for their interest and their support.

Income Tax ActPrivate Members' Business

5:50 p.m.


Christiane Gagnon Bloc Québec, QC

Mr. Speaker, I am happy to take part in this debate concerning families and particularly the twin roles played by many mothers as both educator and provider. I will thus limit my speech to families with children of school and pre-school age.

The figures on working women are constantly changing. For example, in 1969, only 30 per cent of both parents had a job, whereas in 1990, that figure had soared to 71 per cent. Thus we see that a large majority of mothers in two-parent families are now on the job market. In my opinion, this is due mainly to the financial requirements of the family. Canada wide, in 1991, 4.1 per cent of double income families had an income under the low income level.

If it were not for the spouse's wages, the rate of low income families would have been close to 15 per cent. The situation was more serious for two-parent families with children under 13. Indeed, in 1987, 12.6 per cent of them had an income under the low income level, whereas if the parent mainly responsible for child care, usually the mother, had not had a job, that figure would have been as high as 25 per cent.

So we see how vitally important it is for a large number of families that mothers work outside the home. However, this presence on the job market is threatened by some factors, including poor child care services. A background document produced by the Canadian Advisory Council on the Status of Women in 1994 revealed that, according to data from 1988, child care problems can have an effect on parents participation in the workforce and on their productivity.

It also said that those problems could affect the productivity of mothers or their participation in the workforce three times more than fathers. So, we see that families need the work of mothers and that it must be supported by adequate child care services. A second explanation of the increased participation of women in the workforce is their desire of fulfilment through a career. Women now represent the majority of B.A. holders. So, they naturally feel the need to apply the knowledge that they received during their studies.

This CACSW document provided the very conclusive results of a poll conducted on female teenagers from across Canada. Almost 90 per cent of girls in the 8th, 9th and 10th grades expected to work full time ten years down the road. Also, more than half firmly believed that they would work for pay long after completing their studies. So, women work to address the financial needs of their families and because they want to and can contribute to the development of society.

Having done this very brief overview of the participation of mothers in the workforce, let us examine the bill before us. This bill provides for the distribution of income among spouses, from the bread-winner to the spouse staying at home to take care of a child who does not go to school full time. The real purposes of this legislation are to create employment and free up daycare spaces, to give credit to homemakers and to enhance the quality of life for families.

Before I comment on these, allow me to review briefly the monetary situation of women living as part of a couple. In 1991, in 75 per cent of all two-income families, the men were earning much more than their spouses. Therefore, in most cases, the recipient of part of the spousal income would be the woman. I will analyze the bill with this in mind.

We do not agree with some of the intent of this bill when it comes to lowering the high unemployment level and dealing with the problems resulting from the shortage of spaces in daycare centres. Of course, these problems are real and we have denounced them repeatedly. However, they must not be used as the basis of an argument against women. Quite the opposite. We should acknowledge the problems of mothers who stay home and take the necessary action to make sure they are economically and socially equal. Women who stay home feel isolated and lack social support. They are affected by the lack of contacts with other adults.

They are also strangers to the influence networks that are so vital to job search. We know that 75 per cent of all women who find jobs have access to a network. That is just as true in politics as it is in other areas.

We also know that the immediate result of years devoted to housekeeping and children is a considerable loss of income and various problems with re-entry into the labour force: the women need updating of skills and retraining; they have no relevant experience.

Finally, when children leave, mothers have to face the empty nest syndrome. It is true for those who are still married, but much more so for women who also face a divorce or a separation. Their emotional problems will greatly increase their ordeal before they can get back on their feet.

This bill seeks to increase the number of women staying at home. Who would benefit from such a measure? Neither women nor society in general, which would be deprived of their positive contributions. On the other hand, when we consider that families need the mother's salary, we must conclude that the proposal of the member for Mississauga-South is intended only for families

where the father's salary is the highest of the two. The male bourgeois dream lives on.

What about the situation of women who are victims of conjugal violence? We know how determining is the control exercised over the victims in this kind of relationship. The bill provides for the spouse who works to share his income. How and when would this be accomplished? There are reasons to fear that this situation would tighten even more the financial and emotional control exerted by an abusive man over the woman who shares his life. We must be careful not to make matters worse for women with this legislation.

I tried to briefly explain the reasons why I oppose Bill C-256. I am sure the author of the bill had good intentions and was committed to improving the situation of these families. However, I think the considered changes will not do so. The evolution of society is closely linked to the improvement of the condition of women and what women want is greater financial independence. They want their specificity to be recognized, as well as their contribution to the life of their community. They want to be equal, and equality is achieved through independence, not subjugation, whether financial or otherwise.

Income Tax ActPrivate Members' Business

5:55 p.m.


Marlene Catterall Liberal Ottawa West, ON

Mr. Speaker, I want to speak briefly to the bill and express my views on the importance of the initiative of my colleague.

Those in the House who know me will know how very strongly I feel that the work I do in Parliament and on behalf of my constituents is extremely important. The work all of us do as members of Parliament is important and valuable to the country. We should never downgrade that work.

I have had a previous career in my life to which I give even more importance. That has been raising three children fortunately with, so far it seems, very good success. I will never stop saying that has been the most important thing I have done in my life. I was fortunate enough to be raising my children at a time when economically we had the choice, or I certainly had the choice without feeling I was depriving my family by staying home and raising them.

That is a choice many women do not have these days. As the member for Québec has said, the majority of women with young children are now in the workforce. Whether women raise their children on a full time basis at home or before and after completing a full day's work, it does not change the significant economic value of the work they do in raising their children and keeping their home, which receives absolutely no recognition in society.

That is the fundamental issue my colleague's bill is attempting to address. I suspect my colleague has motivations for the bill that I would not necessarily share, including encouraging more women to stay home and look after their children.

What I do want to encourage, however, is choice for women. I want to ensure that whatever choice they make is valued by society and its economic worth recognized.

What happens now is that through family law across this country we have recognized family income and family assets accumulated during a marriage as joint and divisible assets. Unfortunately we only recognize that in reality when the marriage breaks up.

We have all followed the Thibaudeau case very carefully, the taxability of child support payments. We all know very well that there are large numbers of parents raising children after a divorce who do not receive the support payments to which they are entitled.

The fact is we do virtually nothing while a marriage is intact, when a couple are raising children together to acknowledge that the stay at home parent is contributing as fully to the economic well-being of the family as the parent in the workforce earning an income.

This is one way of trying to recognize that. I think it is important that we have this discussion because in the last few years I have increasingly heard resentment from women who are fully occupied and working full time raising three or more children. They resent that they are forgoing income to make that important contribution to the lives of their children and I believe to society. Yet because they made that choice, from their reduced income they are required to contribute to support children of other parents who choose otherwise.

That kind of resentment between women in society is not helpful to the equality of women, but it is a fact. It is a fact that will only be changed when we really address how to recognize the economic value of the contribution women make as mothers and homemakers.

This bill before us may not be a perfect solution to that but it is at least the start of discussions. The result of not recognizing the economic value of that work is far reaching and lasts a lifetime. It is a major contributor to the poverty of women that they interrupt a career, interrupt the opportunity to build a career either for a short or long period of time and they never recoup. Even if they go back into their career they never recoup economically.

As a society we want the next generation to be born, yet we penalize women who are the only half of our race capable of producing that next generation.

As I said, some of these are not the arguments of my colleagues presenting this bill. However, they are certainly mine. The result is that poverty is a women's issue and this is a cause of it. That very important work they do in child bearing and child rearing has no economic value in our society and that has repercussions throughout the workplace. It means that when women do go into paid work they tend to be slotted into the kind of work that most closely resembles mothering, looking after the needs of somebody else. Therefore, we underpay that kind

of work in the paid workforce that most resembles whatever comes closest to the mothering and supportive role. Therefore, we create pink collar ghettos in the workforce as well.

I honestly think that is only going to change when we do start addressing and valuing economically the work of women in raising children and creating a home.

I said it lasts throughout a lifetime. One of the things I find extremely attractive about this bill is that it gives women the opportunity to provide for their own financial security in retirement. It gives them the opportunity to contribute to their own pension plan. One of the major causes of poverty among women and particularly of elderly women is that they have never had or have had limited opportunities to contribute to pension plans.

For a number of reasons the motivation behind this bill is a positive one. We also have to address in our economic accounting how we value the work of women. There is a move afoot to have the census include valuing as employment the work that women do as volunteers or at home. I support that and I hope we will do that.

There will be all kinds of economic arguments as to why we cannot do what this bill proposes. We have to start fundamentally questioning how we can perpetuate a tax system that requires depriving some women of economic recognition for the important work they do. I do not suspect we will resolve that today or in the next few months but I hope this bill has made a lot of members of the House start to think about it. I see the hon. Parliamentary Secretary to the Minister of Finance sitting close by. I hope he is listening because he is in a position to start having a positive influence in that direction.

Income Tax ActPrivate Members' Business

6:05 p.m.


Sharon Hayes Reform Port Moody—Coquitlam, BC

Mr. Speaker, I am pleased to rise in the House today to speak on Bill C-256 presented by the hon. member for Mississauga South.

This bill would allow one spouse to split their earned income with a spouse who is working in the home and caring for a dependent child who is not yet enrolled in full time school.

This bill responds to the growing demands of Canadians that recognition be given to those who care for their children at home.

I am pleased to speak to this bill as an MP who has chosen to be recognized as a homemaker in my previous occupation. I have not felt isolated or deprived in that role. I am pleased to speak to this bill during national family week and in this, the International Year of the Family.

The initiatives presented in this bill would meet three important criteria. It provides parents with the option of keeping one parent at home during the early formative years of a child's life with a tax benefit recognizing the contribution as being significant. Income splitting is an important first step forward in recognizing the financial needs of families with young children. It would allow the spouse at home to be eligible for certain pension benefits such as RRSPs.

The most important objective of this bill is that it would reintroduce choice in the realm of child care so parents can have the freedom to make decisions that are in their best interest and in the best interest of their child.

Currently the system favours those who use day care by the tax incentives provided to the spouse earning the lower income. Consequently those who have one spouse stay at home do not have the equivalent tax deductions for providing the service themselves. Coincidentally, with the high taxes they pay single income families with one spouse at home are technically subsidizing those who have two incomes and use day care along with the tax deductions.

The Reform Party considers the family to be the fundamental social and economic building block of Canadian society. We also believe that parents are the number one choice when it comes to providing the best possible care for their children. This view is also supported by the majority of Canadians.

An Angus Reid poll published in Maclean's magazine in June of this year stated that according to all respondents 68 per cent agree that the best type of family in which to raise children has two heterosexual parents with one at work and one at home.

Unfortunately, the majority of Canadians cannot realize this desired ideal because of the limited choice in the area of taxation given to those who stay at home.

As a matter of fact, there is an unfair bias within the current federal tax system against two parent single income families in Canada. Currently, the lower income earner in a dual income family can claim under the child care expense deduction a maximum tax deduction of $5,000 for a child under seven years of age, while $3,000 per child is permitted as a deductible expense for children aged seven to fourteen.

Reform supports many Canadian parents' belief that by allowing a child care taxable benefit to working parents the federal government in essence is advocating dual income families in Canada and in so doing creating an unfair financial situation for stay at home parents.

This government has further aggravated this situation by advocating a commitment to increase the number of day care spaces every time the economy grows by 3 per cent or more. This is a commitment it will have to honour despite the fact that it will only further increase the inequities toward those who

elect to have one parent stay at home to provide personal care for their child.

No move has been made by this government to address this serious inequality which currently exists. Therefore, the bill introduced by my hon. colleague is a very positive step in the right direction.

Until such a time as a system of flat tax can be implemented the Reform Party supports the concept of income splitting between legally married couples. No other measure of tax relief would affect the family so greatly under our current system as the ability to split income and lower the resultant tax burden. The tax savings would be particularly meaningful when one spouse is working as a full time care giver to their children.

Regardless of the employment situation of the husband and wife, the marriage union will be recognized in tax law as an equal economic partnership. Should the flat rate income tax proposal presently being considered by the Reform Party be implemented, income splitting would become largely irrelevant because individually or collectively a couple would pay the same tax.

It is also important to counter some of the criticism launched against reformers by those who claim that supporting such policies is simply a means of trying to turn back the clock and keep women at home. Quite the contrary. We are simply responding to the desires of a large number of Canadian families that would like to stay at home to care for their children if they so chose without being unfairly disadvantaged financially by federal tax laws.

We believe that if implemented correctly, measures such as income splitting will allow those parents who are forced to work because of finances the option to stay at home and care for their children.

In a recent survey conducted by Angus Reid 57 per cent of respondents thought it would be good news if the government would provide some type of financial assistance to help one parent in a two parent family stay home to care for their children.

Income splitting would have several strong advantages to those involved and some spinoff benefits for others. First, it would help alleviate the excess tax burden experienced by those single income families with one spouse at home to care for their children. Even with a maximum of $25,000 of split income it would allow the spouse at home to receive proper benefit in terms of income and participate in simple pension benefits such as RRSPs. The tax burden on the family would be lessened, allowing for more disposable income to be spent on the very real needs of raising a family today.

Second, it would also have spinoff benefits in the area of employment and day care space availability. There is a very real need among single parents for both day care spaces and potential employment. If the spouse of a two income family leaves their job to care for their child at home this opens up a job for someone else and also creates a day care space. A single parent who wants to get off any sort of social assistance needs both of these possibilities to do so. These are very real needs for the single parent and simply creating day care spaces is only half the solution. Income splitting could provide for all components necessary in the equation.

The bill does have one apparent weakness in that it limits the deduction to those with preschool children at home. I would advocate that the bill be considered for amendment in that the eligibility criteria be extended to include those spouses who stay home to manage the affairs of the home with children who are in school. This is also an important area of parental care.

As critic of family issues I have heard from numerous Canadians across Canada regarding the issue of recognition of those who stay at home to provide care for their own children. It is also an issue in my own riding.

Let me read from two letters I received from two of my constituents. Mrs. Andrea Jones in Coquitlam wrote to me after I was first elected, sharing her concerns on the present status of the Canadian family.

She is a stay at home mother with a toddler to care for. Her husband is employed but they are finding it very tough to make ends meet. Andrea asked for equality to be implemented within the present tax system that does not discriminate against single income families. I quote from her letter:

I understand the terrible financial mess this country is in, but I strongly feel that the subsidies enjoyed by two-income families discredits the hard work homemakers do in support of their children, husbands and community.

Andrea Jones and her husband are not asking for special treatment, just fair and equal treatment.

Sandra Boleak from Port Coquitlam also wrote to me this past spring about the need for the government to recognize the important work of those who stay at home in support of the family.

Sandra and Len have four children at home under the age of six. Sandra left her full time, good paying job in 1989 to look after her family. Since then, it has been difficult financially and the sacrifice they are making to keep one parent at home is real. She states in her letter:

When will stay at home parents' jobs be recognized and respected? Why can my husband not write me off as a caregiver as well as claim the spousal amount?

The dilemma facing parents who have exercised this choice is that they are disadvantaged taxwise for doing so. They have

chosen the preferred child raising option of Canadians and yet pay higher taxes on their earnings because of it.

There is a real need to entrench within government policy and give full recognition to the importance of family in our society. The issue of child poverty is rooted not in the issue of women's rights or even of children's rights but in the issue of the strength of families.

Government policies can actually detract from the importance of family role. It is refreshing to see a slight reversal of this trend from the government side. Perhaps this will send a loud message with a purpose to give the family back its prominence and priority within our society, and give them back the freedom to choose.

Income Tax ActPrivate Members' Business

6:15 p.m.


Pierrette Ringuette-Maltais Liberal Madawaska—Victoria, NB

Mr. Speaker, I welcome this opportunity to support the hon. member's bill. I may add I am not so naive as to expect the Canadian tax system and the general public to support this kind of bill. However, before we have legislation supported by the majority of the people and the members in this House, we must first have some time for discussion.

In fact, this bill gives us an opportunity to look at our tax policies and consider how the Act could be amended. It may well be that at Finance or National Revenue, this kind of legislation is seen as a considerable loss of revenue. I must point out that this would only be in the short term. If we look at pension funds in Canada and the Canada Pension Plan, all the supplements paid to the spouse who was unable to take advantage of a private pension plan are so many expenditures for the Canadian government.

I think we should take a much broader view of this bill. We can take the short term view but we can also take the longer view, and I am thinking of the economic spin-offs.

As the hon. member mentioned earlier, I also think this bill raises the whole issue of recognizing the value of work done in the home, work that has a social value in Canada.

At some point we can put a price tag on these social values. Our tax system should be able to recognize that cost, although personally, I think that women or men who decide to stay home do so as a matter of choice or personal emancipation. There are people who function extremely well in the home, although unfortunately, I am not one of them. I notice my colleagues are smiling, but I think we must recognize the value of work done in the home.

I would even say that in this initial bill, perhaps we should have considered all children, not only children of pre-school age who are still at home. In the current context, all levels of government and Canadian society as a whole urge children to take some responsibility for caring for their parents and grandparents.

When care is given to a child, a teenager, an adult or an elderly person, there is an intrinsic social value that should be recognized. I think it is the right time to start this debate on the value of the Canadian family and the individual. I think it is the right time and also the right week, since this is National Family Week. My family includes my parents, grandparents, children, spouse and in-laws. They will be glad to hear that!

I think it is high time, when we are talking about updating all our social programs in this country as well as a review of our tax system in the short, medium and long term, I think it is high time to get this debate going. I may be naive, but I believe that Canadians across the country will be very pleased to have an opportunity to discuss this value and to ensure perhaps that we can create a very just society, one that will be even more just and progressive than it is now.

Income Tax ActPrivate Members' Business

6:20 p.m.

Winnipeg North Centre Manitoba


David Walker LiberalParliamentary Secretary to Minister of Finance

Mr. Speaker, I welcome the opportunity to participate in the debate. I would like to thank the hon. member for Mississauga South for raising these issues through Bill C-256.

While I appreciate the intent of the bill I have some serious concerns with the proposal. I would like to bring to the attention of the House and the very many members who are interested in this three concerns.

First, I believe it would reduce tax revenues at a time when our fiscal position precludes any erosion of the tax base. Second, I do not think the proposed amendments to the Income Tax Act will deliver the anticipated benefits. Third, this bill could have negative consequences that may not have been anticipated by its sponsor.

Parents among us will know that raising young children entails unique expense. I personally fit into one of those families where one parent works and we have two young children at home. Expenses can put significant pressure on a family's income. Fortunately these expenses are recognized by the Income Tax Act. For example the child tax benefit provides financial assistance for low and middle income families with children. A supplement of $213 is provided for each dependent child under seven.

This measure is directed particularly to those families where one spouse stays at home to care for preschool children. Tax relief is also provided to working families through the child care expense deduction which helps to offset day care costs. Recognizing that the cost of child care is higher for preschool children the limits on the deduction are higher for children below age seven.

This bill proposes additional measures to assist families with preschool children. Under the proposed bill families could reduce their tax burdens by transferring $25,000 from a working spouse to a spouse who is managing the family home and is caring for at least one preschool child.

The bill is intended to provide several benefits for families with young children. As I understand it the intent of the bill is that many spouses with low incomes could then afford to quit their jobs, stay at home and care for their children. This would reduce the family's child care expenses, free up day care spaces, and create additional employment. The hon. member suggests that all this would happen at no material cost to the government.

Let me suggest some revenue losses. The revenue losses associated with this proposed measure would actually be substantial for both levels of government. In fact the Department of Finance estimates that the revenue losses for federal and provincial government could approach $1 billion annually.

Here let me remind all members of Canada's fiscal challenge. On a per capita basis we are one of the most indebted nations in the industrial world. That national debt built up by governments spending more than they earned limits our ability to create new jobs and sustain economic growth. It pushes up interest rates, hampering investment, and hindering our ability to succeed and grow in a world that grows more competitive with every passing day.

In short, any measure before us must be evaluated in terms of whether it adds to our deficit and the tax burden it imposes on all Canadians. Unfortunately the proposal would likely do just that. To implement Bill C-256 without affecting our financial position, we would either have to increase other taxes or find corresponding expenditure reductions elsewhere. Ironically, these revenue losses would occur because the proposed measures would not solely benefit those families to which they are directed.

In particular tax benefits would flow to families not currently saddled with day care costs. Instead thousands of families where one spouse already stays at home to provide care for young children would automatically receive the tax savings. In these cases no additional day care spaces and no additional jobs would be freed up.

In addition, revenue losses could occur if Bill C-256 increases the tax benefits to working couples without actually changing their working status. For example, consider what would happen if proposed tax savings were greater than the value of the child care expense deduction they currently claim. Some two-earner families might then forgo claiming the child care expense deduction to remain eligible for the measure proposed in Bill C-256.

There are other unintended consequences that passing this bill could impose. Among them is the fact that eventually families which benefited from the proposed measure would suffer a significant drop in disposable income.

The income drop would occur when their children began full time attendance at school. At that point these families would no longer be eligible to split the income of the higher earning spouse. The resulting tax increase would reduce their disposable income.

Significantly, the income drop would arrive when the family could least afford it. Again, as parents among us will know the costs of raising children increases as the children grow older.

Of course one could argue that to cover these increased expenses the stay at home spouse could merely go out and find a job. Unfortunately as the 1.5 million-plus unemployed will tell you it is not all that easy to rejoin the labour force, particularly for someone re-entering the workforce after a protracted absence during which skills have either been diminished or become obsolete.

In conclusion, the issue of support for families and especially for children is one that the Minister of Human Resource Development is considering as part of his wide-ranging proposals for renewal of our social safety net. We should not undertake this process with legislation that could well miss the mark.

While the intent of Bill C-256 is admirable, I believe its flaws severely outweigh its benefits.

Income Tax ActPrivate Members' Business

6:25 p.m.

The Deputy Speaker

Colleagues, it is almost 6.30. The hon. member for Mississauga South will close the debate.

Income Tax ActPrivate Members' Business

6:25 p.m.


Paul Szabo Liberal Mississauga South, ON

Thank you, Mr. Speaker. I want to thank all hon. members who took part in the debate. It is obviously very important that we have this exchange of ideas.

The one area that I have to comment on is the intervention of the parliamentary secretary. The parliamentary secretary unfortunately took an early memo that was prepared by staff and signed by the minister and sent to me using a billion dollar figure. Subsequent to that we have had numerous meetings to discuss the real finances.

If we compare what the real finances are to what the parliamentary secretary has said we find a substantial difference.

In fact the billion dollar figure assumes that every stay at home parent who is presently there would take advantage of this bill but nobody else would, in which case it is a full drain. It also does not eliminate all those parents that either make too little

and are in the lower tax brackets or too much to even qualify. That reduced the figure to about $500 million.

They gave no credit for the creation of child care spaces. I wonder whether or not the parliamentary secretary would agree that if the government is prepared to spend $12,000 per space to create child care spaces, some credit ought to be generated by those who free up those spaces.

The government used figures when it discussed with me in the worst possible case. This is the fiscally responsible thing to do. I hoped there would be some movement, some understanding that in fact there is real value for work in the home to be recognized. It is an honourable profession. Some tax reform is going to be necessary sooner or later. I want to assure the House that I for one am not going to stop fighting on behalf of all caregivers, whether they be parents working in the home, the seniors, the chronically ill or the disabled.

Income Tax ActPrivate Members' Business

6:25 p.m.

The Deputy Speaker

The time provided for the consideration of Private Members' Business has now expired. Pursuant to Standing Order 96(1) the order is dropped from the Order Paper.