House of Commons Hansard #144 of the 35th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was french.
Michel Gauthier Bloc Roberval, QC
Would the minister agree that scepticism in the financial community has increased considerably since Liberal members announced that the government would probably be unable to reach its goal of 3 per cent of GDP, which they feel justifies a general tax increase, ostensibly temporary, a proposal the Minister of Finance is still considering?
Paul Martin LiberalMinister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec
Mr. Speaker, if there is any scepticism on the financial markets about a government that refuses to deal with its problems, it most certainly concerns the provincial government in Quebec, the PQ, the Bloc Quebecois headquarters. Ever since they came to power, they have refused to admit that they have a financial problem and that both levels of government will have to work together to deal with that problem.
Michel Gauthier Bloc Roberval, QC
Mr. Speaker, I cannot believe what we just heard. For the past 14 months, the Minister of Finance has been talking about the Government of Quebec. With a $40 billion deficit, rising interest rates and his policies that have been a complete failure, he talks to us about the Government of Quebec. I cannot believe it.
Michel Gauthier Bloc Roberval, QC
Mr. Speaker, look at them carrying on. And they talk about the Government of Quebec.
The EconomyOral Question Period
The Speaker
Wonderful Wednesday. The hon. member will please put his carefully wrought question.
Michel Gauthier Bloc Roberval, QC
Thank you, Mr. Speaker, for this advance appreciation of my question. Would the Minister of Finance admit that by merely coasting along on our economic recovery instead of stimulating job creation as he should have done, he has heightened the lack of confidence in the financial community which no longer believes his promises to reduce the deficit?
Paul Martin LiberalMinister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec
Mr. Speaker, in the last quarter, we experienced 4.6 per cent growth, and in the quarter before that, 6.4 per cent. This year, 400,000 jobs were created. Last month, 95,000 jobs were created in Canada, a record for this country. Congratulations to my colleagues.
Yvan Loubier Bloc Saint-Hyacinthe—Bagot, QC
Mr. Speaker, I would remind the Minister of Finance that one month after he tabled his first budget, Canada's rating was downgraded, while, so far, Goldman Sachs and Moody's say that Quebec's credit rating will be maintained.
Yvan Loubier Bloc Saint-Hyacinthe—Bagot, QC
The Minister of Finance continues to ignore the proposals and recommendations made by various stakeholders, including the official opposition, to reduce the deficit. His inaction has earned him very poor marks in the eyes of the financial community as this session ends.
Will the Minister of Finance not recognize that before contemplating further tax increases, he should make it a priority to recover the bulk of the $6.6 billion in unpaid taxes owed to the federal treasury?
Paul Martin LiberalMinister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec
Mr. Speaker, the hon. member for Roberval asked us to make cuts. Now, I will ask the Bloc Quebecois finance critic for the fifteenth time, where does the Bloc suggest that we cut? We have yet to receive a single note or suggestion. Really! Family trusts? I am waiting for the finance committee report. I think that you submitted your opposition yesterday. But where, where really, should we cut? Make suggestions. Be constructive.
As for Goldman Sachs, the firm has made a favourable report because its people have said that the people of Quebec were obviously going to vote to remain within a united Canada.
Yvan Loubier Bloc Saint-Hyacinthe—Bagot, QC
Mr. Speaker, we did submit proposals to the minister. As a matter of fact, when will he admit that, had he put a stop to unjustified tax shelters as we suggested, collected outstanding tax accounts as we suggested, stimulated employment as we suggested, in a word, had he taken aggressive action to cut spending over the past year-a year wasted-he would not now be facing a credibility gap, this confidence crisis, and an upward swing in interest rates that will affect everyone in Canada.
Paul Martin LiberalMinister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec
Mr. Speaker, we are now enjoying the highest economic growth of any of the G-7 countries. We are enjoying the highest economic growth of almost any of the OECD countries. We are creating jobs. We are reinvesting in the economy. We have the best productivity record of almost any of the industrial countries. Our exports are up. I have been told about 10 times that our exports are up.
Let it be very clear that this has been a very good year for the Canadian economy.
Interest rates are up. They are up because of inflation in the United States. They are up for a number of reasons. The single most important reason for the increase in interest rates this week is the international financial community has said that one of the major provinces of the country, Quebec, refuses to face up to its deficit problems.
I call upon it to do its job.
Preston Manning Reform Calgary Southwest, AB
Mr. Speaker, the Bank of Canada rate rose three quarters of a per cent yesterday to over 7 per cent, driving up consumer loan rates. Since April the interest rate increases have added about $200 a month to payments on a mortgage of $100,000.
As the finance minister knows, our national house is mortgaged to the tune of $542 billion, on which we make payments of approximately $3.3 billion a month in interest alone.
Could the minister tell us what impact these interest rate increases over the past year are having on the national mortgage? Could he give us a precise dollar figure on how much these interest rate increases are costing the federal treasury since the government took office?
Paul Martin LiberalMinister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec
Mr. Speaker, it is a matter of public record and was set out in the House of Commons finance committee. Each one per cent increase in interest rates costs the nation $1.7 billion on an annual basis.
Preston Manning Reform Calgary Southwest, AB
Mr. Speaker, when the average Canadian is faced with a $200 a month increase in mortgage payments, he or she has only one real option and that is to cut spending in other areas of expenditure. When it comes to meeting increased mortgage payments on the national house we hear, to our dismay, that the ministry is now considering getting the money from tax increases on gasoline, on personal incomes and on corporate incomes.
Will the minister please tell us that these rumours are utterly unfounded, that there is no truth to the fact, and that he has no intention of taking more money out of taxpayers' pockets in order to meet his increased mortgage payments?
Paul Martin LiberalMinister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec
Mr. Speaker, I have responded to this question on numerous occasions by simply saying that the government will make its position known in the budget. We are in the consultation process. We are waiting for constructive suggestions from Canadians and from the two opposition parties.
We are waiting for the Reform Party to complete its suggestions for areas in which we should make cuts. For instance, the person in the Reform Party who was concerned with social policy-that is an oxymoron-the member for Calgary North, said she would cut some $16 billion or $17 billion out of social policy spending.
We are waiting for the Reform Party to give us its constructive suggestions. We will make our position known in the budget.
Preston Manning Reform Calgary Southwest, AB
Mr. Speaker, the blunt truth of the matter is if the minister cuts spending the way he should, special interests in the country will squeal like stuck pigs. If he tries to fix the deficit with tax increases he will injure the economic interests and prospects of every man, woman and child in the country. He is going to take heat either way.
Why does he not take the political heat for doing the right thing rather than the wrong thing and declare that he will fight the deficit only through spending reductions? Why do you not take the heat, through you, Mr. Speaker, for doing the right thing rather than the wrong thing?
Paul Martin LiberalMinister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec
We are prepared to take the heat, through you, Mr. Speaker.
Paul Martin Liberal LaSalle—Émard, QC
In fact we would much prefer to do it that way.
We understand the bulk of the actions that have to be taken must be taken on the spending side. We understand that Canadians have to live within their means and that they expect their governments to do the same. We are going to do that.
We also have had the benefit of a very well thought out report by the House of Commons finance committee in which members on all sides of the House participated. That is an important part of the consultation process. We intend to take that into account and we will give our answer when we bring down the budget.
Claude Bachand Bloc Saint-Jean, QC
Mr. Speaker, my question is for the Minister of Intergovernmental Affairs.
With just 10 days before Christmas, time is running out on the issue of the Royal Military College in Saint-Jean for the teachers, their families and the whole Saint-Jean community. All stakeholders have agreed to discuss the merits of the proposal from the mayor of Saint-Jean, which provides for the gradual conversion of the military college into a civilian educational institution. The only holdout is the Minister of Intergovernmental Affairs.
Can the minister promise today in this House to resume discussions on the basis of the proposal from the mayor of Saint-Jean, which provides for a three-year transition period?
Marcel Massé LiberalPresident of the Queen's Privy Council for Canada
Mr. Speaker, I spoke to the mayor of Saint-Jean yesterday at lunchtime and it is clear that we can come to an agreement. The only obstacle is that the Parti Quebecois has not yet agreed on the basis of negotiations. I hope to be notified in the coming days. As soon as I am notified, we will resume negotiations.