House of Commons Hansard #22 of the 35th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was project.

Topics

Prince Edward Island Fixed LinkGovernment Orders

6:20 p.m.

The Acting Speaker (Mrs. Maheu)

Call in the members.

And the division bells having rung:

Prince Edward Island Fixed LinkGovernment Orders

6:25 p.m.

The Acting Speaker (Mr. Patry)

At the request of the chief government whip, the division is deferred until 6.30 p.m. tomorrow.

(The sitting of the House was suspended at 6.26 p.m.)

The House resumed at 6.30 p.m.

A motion to adjourn the House under Standing Order 38 deemed to have been moved.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:25 p.m.

NDP

Nelson Riis NDP Kamloops, BC

Madam Speaker, I am pleased to participate in this debate on the underground economy and the recognition that Canadians generally have lost faith in our tax system. Somewhere between $60 billion and $100 billion in business transactions now take place beneath the surface in a way.

My question to the minister the other day was whether or not the government was taking any definitive action to encourage those people who now want to move their operations above ground and become legitimate players in the marketplace. Also to what extent would the government introduce programs that would encourage that to occur.

What is it about the tax system that has upset people? What is it about the tax system that has discouraged people who are hard working, who are running their businesses or going off to the mills or the mines, the farmers, the fishermen? It can be summed up in the interpretation bulletin IT-518 from Revenue Canada. This was sent recently to various businesses and individuals. It gives clues on all the things one can use as a tax deduction, legitimately to be fair, within the tax system, particularly when it comes to entertainment.

For example, this is not an exhaustive list but entertainment includes tickets for theatres, concerts, athletic events, or whatever the performance might be. Renting or leasing a private box at the sports facility and buying champagne for friends is all tax deductible. Renting hotel rooms to have a party and entertain people is deductible. Buying liquor for a hospitality suite of course is tax deductible. Taking a cruise in the Caribbean, the South Pacific or to Greece is tax deductible. Taking friends to a fashion show is also tax deductible. I guess people want to learn how to dress more modernly and so on.

If you want to take your guest to a nightclub, Madam Speaker, or out to a hockey game, a football game, a baseball game or whatever; or if you want to take your friends fishing in northern Canada, northern Quebec, British Columbia or wherever; if you want to go hunting in northern Ontario, northern Saskatchewan or northern Quebec, that is all tax deductible. Generally you can say: "Let us go on a three week vacation in Labrador and we will discuss business". Again that is tax deductible.

I am not saying there is necessarily anything dastardly or terribly sinister about this. However certain people can go fishing, hunting, camping, to the football game, or rent a room to entertain friends and it is done with the help of the tax system. The taxpayers generally pick up part of that tab. If one is deducting up to 80 per cent of those costs obviously then those who are at the hockey game watching the people up in the box drinking champagne or whatever, who have free tickets or only pay 20 per cent of the price, are paying their way buying hot dogs and so on.

In closing, after reading things like this bulletin from Revenue Canada is it any wonder that people have become absolutely disenchanted and disappointed with a tax system that can only be described as unjust, unfair and biased.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:35 p.m.

Broadview—Greenwood Ontario

Liberal

Dennis Mills LiberalParliamentary Secretary to Minister of Industry

Madam Speaker, there are many things in the hon. member's remarks that I happen to agree with. However I would like to begin by saying we know it was the GST in the last three years that really exacerbated the underground economy not to mention the added paper burden for small business. Most

members would agree with that.

We have taken a stand on this side of the House to eliminate the GST. It was announced in the finance committee the other day that this study would begin right away. By the end of June we will have all the possible alternatives which will be much more fair, simple and efficient.

Recently the government showed it was serious in going on the offensive against the underground economy by taking on the tobacco issues. The changes in taxation were announced eliminating financial incentives that drove the significant subsector of the underground economy. Already there have been some reports of reductions in the volume of tobacco being smuggled into Canada which shows the effectiveness of that particular policy.

The Department of Finance is working closely with Revenue Canada looking for ways to streamline and simplify the system.

I also want to say we have to be careful when we loosely throw around some of these tax deductions as being special privileges for the wealthy. I share the member's view with the Skydome box holders. However, with respect to tourism and fishing trips these measures were put in to aid small business tourism operators. If all of a sudden we were to eliminate all of those things it would cause significant unemployment. We have to be very careful in how we address those particular deductions. I know the member would not want to see an adverse condition because of a reckless tax preference cut in our tax act that would affect an industry which he too is so proud of.

I want to acknowledge that we recognize there are some serious flaws in the tax act of Canada. We take all of the member's specific points today and hope to address them in the near future.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:35 p.m.

Reform

Dale Johnston Reform Wetaskiwin, AB

Madam Speaker, my topic is really quite timely given the fact that we expected a vote a few minutes ago and suddenly it was put off.

The other day I asked the Prime Minister when he would announce to the House that the government would not consider the defeat of a government motion including a spending measure to constitute the expression of non-confidence in the government unless it is immediately followed by a formal motion of non-confidence.

It is time to release the members of Parliament from the iron cage of party discipline in this country. I think that the House of Commons is probably one of the most regimented parliamentary systems in the world. We must not forget that we were sent here by the people of Canada. We were sent here to represent the views of the people of this great nation, not the wills of the political parties.

It is also time to debunk the myth that the government must win every vote or resign. The failure of a government measure, even a spending initiative, does not automatically have to mean the defeat of the government.

The Prime Minister, the cabinet and the bureaucrats set policy and dictate the course of action with the usual assurances of: "Don't worry. We know what we are doing. We know what is best". The time has come to give the electorate greater say in government.

For too long it has been politics first. Now it is time to put people first. How can we do this? We can loosen the chains. We can allow for free votes in the House of Commons. If for example a vote on a budget measure or motion was negative, it could be sent back to committee and improved before coming again to the House. If the government loses the non-confidence motion that follows that motion, then it would have to resign and call a general election. The people of Canada want more direct democracy and I would encourage the Prime Minister to comply with their wishes.

The Constitution provides for this. All the Prime Minister needs to do is rise in his place and declare that the government will not consider the defeat of a government motion including a spending measure to constitute an expression of non-confidence in the government unless it is immediately followed by a formal non-confidence motion.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:40 p.m.

Etobicoke—Lakeshore Ontario

Liberal

Jean Augustine LiberalParliamentary Secretary to Prime Minister

Madam Speaker, on February 2, 1994 the member for Wetaskiwin questioned the Prime Minister on the issue of free votes.

The hon. member should realize that this government has done more to champion the cause of House of Commons reform in the first 100 days of its mandate than the previous government did in nine long years.

On Monday, February 7, the government House leader placed before this House a framework for renewal. This framework addressed a wide range of issues this government believes will reinstate the trust and respect that Canadians want to have in their institutions.

On the subject of free votes it must be noted that this is not a matter dealt with now by the standing orders of the House. Instead it is a matter to be dealt with by each party and each party's members themselves.

This is why the hon. member will note that in part VII of the government House leader's motion there is a reference to the Standing Committee on Procedure and House Affairs to examine free votes in the House of Commons and other important matters.

Therefore I ask the hon. member and his party to fully participate in this process. I am sure he agrees with me when I

say that the task ahead is to reinforce the fundamentals of the system and restore a more active role for all members of Parliament.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:40 p.m.

NDP

Svend Robinson NDP Burnaby—Kingsway, BC

Madam Speaker, on January 20, 1994 I raised a question in the House with respect to the government's upcoming decision on the testing of cruise missiles in Canada.

This question dealt both with the substance of the tests as well as the credibility of the government and the promises it made when in opposition. Although the Liberal government of 1983 had signed the first testing agreement, in opposition it took a very different position.

The written commitment that was made during the last federal election stated it would bring this testing program to an end. It went on to speak about the importance of public hearings that would involve northerners, peace groups, aboriginal peoples and others.

What happened? There were no parliamentary hearings. In fact there was only one northern member of Parliament who spoke in the debate, the hon. member for Nunatsiaq. He spoke very eloquently against the testing of cruise missiles. He indicated that he was also speaking on behalf of his colleague, the member for Western Arctic.

I know my colleague from the Yukon has spoken eloquently on many occasions both in this House and outside on behalf of her constituents in the Yukon against the testing of cruise missiles. Of course the Reform Party was ready. It supported the testing of cruise missiles.

I must admit that I was really shocked and disappointed by the Bloc's position on this issue. At the same time, I was not overly surprised because Mr. Bouchard had gone to Washington to reassure the Americans that an independent Quebec would remain a faithful and loyal ally, that there would be no change in Canadian policy, that the policy would remain obedient to the United States.

The sad thing is that today, just two hours ago, I have heard a member of the Bloc Quebecois say: "Now, the Bloc is thinking as a block". If that is the case, it is sad indeed.

Quite clearly there is no legal obligation whatsoever to conduct these tests. In fact the minister himself said it was a courtesy that he was extending to the United States. I suggest there was an alternative. The alternative was to say no. There is a foreign policy review. There is a defence review.

Let us look at strengthening multilateral institutions. Let us look at working toward peace. Let us look at ending the tests of low level flights over Innu lands as some Liberals have called for on a number of occasions. Indeed today I met with Daniel Ashini and Elizabeth Penashue from the Innu nation who talked about the devastating impact of these tests over their lands.

Let us support the World Court project. The World Court project is a very important project in which Canada is being called on to join in submitting a legal brief to the International Court of Justice making the use of nuclear weapons illegal under international law.

Those are the kinds of alternatives that the government could have had. Those are the kinds of alternatives that would have meant that we had a truly independent foreign policy. In fact retired U.S. Admiral Eugene Carroll, one of the most respected commentators on this question, said that any decision by the Liberal government to end the testing would be viewed as "an assertion of Canada's independence" and have no negative ramifications.

That is what we thought the Liberals were promising in opposition. That is what they talked about in their red book. Certainly that is not what they deliver.

Let us hope these tests will be the last tests and that Canada will have an independent foreign policy based on peace and preservation of the environment and a respect for aboriginal peoples and northerners.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:45 p.m.

Bonavista—Trinity—Conception Newfoundland & Labrador

Liberal

Fred Mifflin LiberalParliamentary Secretary to Minister of National Defence and Minister of Veterans Affairs

Mr. Speaker, when I was in opposition and asked questions of the government I never got any answers. I can tell the hon. member that he is going to get an answer. In fact he has answered his own question so I really could sit down now.

However, I will say that in 1993, two months before the election took place, the hon. member would know that the previous government authorized these tests. They were due to take place on January 25, 1994. After this government came to power and while in opposition we promised a parliamentary debate on this subject.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:45 p.m.

NDP

Svend Robinson NDP Burnaby—Kingsway, BC

Public hearings.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:45 p.m.

Liberal

Fred Mifflin Liberal Bonavista—Trinity—Conception, NL

We promised a debate on this subject. When the government was formed we had a debate on it in a reasonable time, on January 26 as a matter of fact. Twenty-nine members participated in the debate and 30 or so participated in question and comment.

I have to tell members that the preponderance of the debate and the comment was in favour of testing. As a result, the government made the decision and on February 3 announced that the test would be authorized to continue. We expect they will be done this month.

At the same time, the government made it clear to the United States government that it should not presuppose any outcome of the parliamentary debate and the public hearings on both the defence policy and the foreign policy which will address, and the hon. member is right, the very strong feelings still in this

country on testing. This is one of the subjects that will be addressed.

I remind the hon. member that as the quarterback parliamentary secretary for this debate I promised to get him on about 7.30 and in fact he got on at 7.43. I am sure he appreciated the co-operation and the credibility of the government.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:45 p.m.

Bloc

Réal Ménard Bloc Hochelaga—Maisonneuve, QC

Madam Speaker, I would have liked the Minister of Industry to be with us. I am sure his parliamentary secretary is very competent, but I would have liked him to be present since I asked him a question on the electronic highway on February 4 and the minister was rather evasive and tight-lipped on this issue. The population is rather concerned about this, as we do not really know where the government is going. We are under the impression that the Minister of Industry is not really in on it and that he has his foot on the brakes.

The information highway is a very important issue, for it is a great adventure that could link all Canadians with national and international networks that could give us access to hospital and school data banks and to all kinds of information.

It is an important issue that needs to be debated. I would have liked to ask the minister because whenever we ask him about it in the House, we get the impression that he leaves everything to the private sector and that he does not intend to spend government funds on this.

When we look at what is happening in the United States, we can see that if Canada, which has a very good track record in the technology, communications and telecommunications sectors, is to enter the information highway, the minister should give clear indications and invest money.

I was concerned to hear that he wanted to set up an advisory committee. My concern is that this issue was examined last year by another committee chaired by Mr. Ostry, the president of TV Ontario, who tabled a report outlining very clearly the legislative and regulatory measures the government must take to build this electronic highway.

I am wondering if the minister, who is acting a little slowly on this issue, is not trying to divert our attention by striking a new advisory committee whose mandate is still unclear. I hope that the parliamentary secretary will be able to tell us exactly what this committee is supposed to do. What are the government's intentions? Will public funds be made available? Will he be able to gather around the same table representatives of the private, institutional and public sectors to finally turn the information highway into a reality?

I would like to give him a warning, Madam Speaker, since this electronic highway could also become a very effective instrument of centralization through its impact on education and training.

I hope that we can rely on the parliamentary secretary to speak on behalf of the minister and promise this House on his honour that, in building the electronic highway, the government will respect areas of provincial jurisdiction and ensure that communications linking us to Internet are also in French. I know that is one of his concerns. Having said that, I will now let him have the floor.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:50 p.m.

Broadview—Greenwood Ontario

Liberal

Dennis Mills LiberalParliamentary Secretary to Minister of Industry

Madam Speaker, let me begin by saying to the hon. member that I can assure him that the Minister of Industry does not have his foot on the brakes on this particular issue. In fact, it is quite the reverse. He has the pedal right to the metal, as they say, and we are going full bore on this particular issue of the electronic highway.

I want to remind the House that, first of all, it was announced in the speech from the throne that we were going to develop a strategy for Canada's information highway. On February 2 the secretary of state for science and technology committed the federal government to a number of objectives and principles to guide and develop the approach.

We talked about the advisory council because it is a very important issue. It is a complex issue and we wanted to make sure that the council would have a broad range of groups and organizations that would help formulate Canada's strategy in this particular area. Also, we want to make sure that there is representation from not just industry but from labour, education and consumers.

The council, which is in the process of being put together right now, will be announced very soon. This council will provide advice to the government and it is going to be active on line. I can tell the member that this government is putting incredible resources behind the information highway, the electronic highway.

I can speak about our own case in which we are beginning to put information out. In the Toronto region we are doing some testing which will go into other regions. We are looking at ideas for community access centres. Let me reassure the member that this government is committed in a very serious way and will be moving very fast. We welcome his input.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:55 p.m.

NDP

Audrey McLaughlin NDP Yukon, YT

Madam Speaker, I rise on a question that I asked the Minister of Health on February 10,

1994 on health care and on her position on the reduction of taxes on alcohol products which the Distillers Association of Canada the day after the reduction of taxes on cigarettes began to advocate for.

The response to that question was in effect no comment. The response of the Minister of Health to the reduction of taxes on cigarettes was in effect no comment. The reaction of the Minister of Health to the proposed federal idea of taxing the health benefits of employees was in effect no comment.

This is not good enough for the future of health care in this country. Within the next two years we will be undertaking a very comprehensive discussion right across the country on the future of the health care system. It seems to me that the Minister of Health by refusing to take a stand, including a response to my question on her position on the reduction of taxes on alcohol, is not being an advocate for health care in this country.

The lowering of federal tax on cigarette products clearly is going to be a major cost to the economy. The estimates are that over some $300 million a year will be added to the federal deficit as a result of this and this does not account for revenues that will be lost by provinces and territories if they too reduce and follow that lead.

Clearly, when people are concerned about the debt and deficit in this country this rather odd move by the government in an ad hoc policy attempting to resolve what is clearly a very difficult problem, that of smuggling, has created many others. We simply do not have a Minister of Health prepared to stand up and be clear about her philosophy about health care in this country.

We see by the most conservative estimates that the true cost of tobacco related illnesses to the health care system in this country is about $9.6 billion a year with indirect costs being some $15 billion a year. Clearly, the refusal of the minister to take a position on these issues jeopardizes the health care system in this country.

There have been many comments on this issue. There are many points of view on this issue. Surely Canadians can expect a minister of health to stand up for the health of Canadians and to be that strong advocate.

I want to assure all Canadians that the New Democratic Party will continue to be a strong advocate for a strong health care system in this country that meets the needs of all Canadians.

One commentator, Dalton Camp, commented that this policy clearly was joining the Reform Party too soon.

My question to the parliamentary secretary is simply is it the government's intention to reimburse provinces and territories for lost revenues with this policy of reducing taxes on cigarettes and potentially on alcohol products?

Prince Edward Island Fixed LinkAdjournment Proceedings

6:55 p.m.

Vancouver Centre B.C.

Liberal

Hedy Fry LiberalParliamentary Secretary to Minister of Health

Madam Speaker, the question as the hon. member has said is a very complex one and to try to boil it down to a simplistic answer is impossible.

I will take on the issue first and foremost of the problem of tobacco smuggling. When the Prime Minister stood up in this House on February 8 and announced his national action plan on tobacco he said very clearly that smuggling is threatening the safety of our communities and the livelihood of law-abiding merchants. The problem of tobacco smuggling is an increasingly complex one because it touches on the very fabric of our Canadian identity which is dedicated to peace, order and good government. It touches on the safety of our communities. It touches on respect for law and order. It also affected the economy and, as the hon. member mentioned before, the health of Canadians.

Organized crime networks have been responsible for 95 per cent of the tobacco smuggling that was going on in Canada. They were also responsible for smuggling liquor, drugs and firearms at the same time. Tobacco and alcohol were controlled drugs as were firearms. We would have lost control over these controlled substances if we had not done something immediately to deal with that smuggling and to deal with the smuggling of liquor.

In order to deal with the matter the government took unprecedented action. I want to remind the hon. member that the issue is not a new one. It has been going on for years. The past government tended to ignore it and to pretend it did not occur. We took immediate unprecedented action. We increased the number of RCMP and customs officials dedicated to fighting tobacco smuggling. They are using new strategies. They are accompanying these resources with other strategies to crack down and to keep surveillance on smugglers starting immediately.

The hon. member talked about the lack of a response from the Minister of Health on this matter. The Minister of Health is responsible and has worked very hard for the major health strategy found here. We have invested about $185 million in funds from taxing the tobacco industry. They will be dedicated to prevention and promotion. We have already seen the launch of a media campaign aimed at kids, the proclamation of the Tobacco Sales to Young Persons Act, and legislation to eliminate kiddie packs, to increase the age and to crack down on sale to minors. The minister has responded.

Prince Edward Island Fixed LinkAdjournment Proceedings

6:55 p.m.

The Acting Speaker (Mrs. Maheu)

I am sorry but the time for the member's response has expired.

It being 7 p.m., the House stands adjourned until tomorrow at 2 p.m., pursuant to Standing Order 24(1).

(The House adjourned at 7 p.m.)