Debates of Feb. 24th, 1994

The Budget

[Tony Ianno, Liberal, Trinity—Spadina, ON]

Mr. Speaker, I appreciate the question from the hon. member.

We wish that we did not have any debt to deal with and could just deal strictly with investment. However, as a small business person I can tell the hon. member that when one is searching for growth, one has to pay a price and that price is in investment.

I believe that we need to retrain our work force in Canada. I indicated in my speech that we have to give training to the lower echelon of Canadians, those who do not currently participate in the situation. We have to give them the opportunity to have the tools so that we, as business people and entrepreneurs, can develop the niche markets and expand internationally to bring all of that money back to Canada for growth. We must help Canadians, those who are not as fortunate as some of us, to be able to participate in the process.

I therefore believe that there is an investment. I am not afraid of having a debt in order to invest in the future.

[The Deputy Speaker]

It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Crowfoot-Indian Affairs; the hon. member for Regina-Qu'Appelle-Book Publishing Industry.

[Paul Devillers, Liberal, Simcoe North, ON]

Mr. Speaker, I am pleased to speak in support of the budget tabled by the finance minister earlier this week. I am particularly comfortable in supporting this budget because it is the funding of the red book key programs that were the Liberal platform in the last election. They contain investments in people and job creation not necessarily through tax increases but rather through spending cuts.

Earlier today in this House I heard what in my opinion was hollow rhetoric coming from the backbenches of the independent members to the effect that this budget must have been ghost written by a former Tory minister.

I would like to take the opportunity to outline some of the measures contained in the budget, some of the red book programs that are being implemented. For instance, the establishment of the national infrastructure program that is already in place, the restoration of full funding for the national literacy program, the establishment of the youth service corps, the establishment of the youth internship and apprenticeship programs, the insurance of access to capital for small businesses in replacement of GST, the reinstatement of the residential rehabilitation assistance program, the establishment of a prenatal nutrition program, the establishment of the aboriginal head-start program, the establishment of a centre of excellence for women's health, the restoration of the court challenges program, the restoration of the law reform commission, the establishment of the Canadian race relations foundation and the establishment of the national forum on health.

I suggest that it is indeed hollow rhetoric to suggest that this was written by a former Tory minister. What this budget contains in addition to the implementation of these red book programs is hope.

If we want to give voters hope in our political institutions again, governments must keep their promises. Canadians have had enough of governments that say one thing and do the opposite. With the former government, this country got the habit of not respecting politicians because of broken promises. Just think of universal social programs, which were a sacred trust for the former government. We are keeping our word with this budget. We are doing exactly what we promised to do.

Past efforts by Tory governments in deficit reduction overlooked the expenditure side of the financial statements. Tory minister after Tory finance minister used to indicate that the forecasted deficits were not attained because there was not enough revenue. They were able to control the spending but there was not enough revenue. That is why I submit that what we have in this country is an income crisis, not a spending crisis.

Government like businesses must be prepared to promote and intervene in economic activity to create revenues. That is something that has been lacking in the last few years and it is something that is contained in this budget that is before the House.

This budget also was delivered following unprecedented consultation.

The pre-budget consultation process begun by the Minister of Finance gave many people an opportunity to express their views on the policies which affect them deeply. The government has created an important precedent with these consultations. I hope that we can go beyond the four cities that were visited by the advisory committee for next year's budget. Through the debates in this House, I was able to share the concerns of my constituents in Simcoe North.

The measures contained in my prebudget debate speech that received favourable review in the budget include the need to prevent tax avoidance through offshore affiliates of Canadian companies, a review by the parliamentary committee of family trust rules, partial preservation of business expense deductions, no reduction in RRSP contribution limits and implementation of a permanent RRSP first time home buyers' plan.

In addition, this government will be undertaking a complete tax review in the very near future. As a matter of fact it is already before committee. That will include the replacement of the GST.

I already said in this House that Canadians have an unprecedented lack of confidence in our taxation policies. If we want Canadians to respect the law, they must feel that the law is fair and equitable.

If we want our economic recovery to succeed, people must feel good and contribute to the economy. I can say with full confidence that the measures in this budget will restore the confidence of Canadians. Canadians can now count on this government for greater fiscal fairness.

This budget has been well received by the international monetary markets. I am aware that the Canadian dollar was indeed up yesterday, the day after the budget was announced. The budget also received favourable comment from the Canadian Federation of Independent Business. It realizes that the UI premium reduction provided for in this budget was in fact a tax on business and jobs and that this measure will indeed help in job creation.

This budget shows that this government is taking a radically different approach from the one the former government took. Some people want us to give up our search for a just society. As the finance minister said, this is not the time to move away from our values; on the contrary, it is the time to return to them.

The mere fact that the opposition parties claim on the one hand that we have not cut enough and on the other that we have cut too much is a perfect indication that this budget is balanced.

The bottom line is that we are delivering on our election promises. This budget puts us on track to reduce the deficit to 3 per cent of GDP in three years. This was what our red book commitment contained.

Some opposition members have been saying that we did not cut deeply enough. This is the position of most of the Reform Party speakers I have heard.

Their election platform as I understood it was a zero deficit in three years. In my estimation that would create untold hardship on Canadians. We have already seen the hardship that the present measures in the military cuts have inflicted on Canadian lives. To attempt to reduce a deficit of this magnitude in three years I submit would be untenable.

The Liberal approach is much more balanced and realistic. The majority of Canadians supported the Liberal plan. Canadians know one cannot stop putting groceries on the table in order to pay off the mortgage on the house in three years.

I do not expect the opposition to agree with this budget since they campaigned against the Liberal plan. I do not believe that they or Canadians can truthfully say the Liberal government is not following our red book plan.

[Benoît Sauvageau, Bloc, Terrebonne, QC]

Mr. Speaker, I apologize to Mr. Collenette if we are bothering him, but we do have to speak up from time to time in the House.

First of all, I want to get back to something my hon. colleague from Simcoe North said. Throughout his presentation, he kept repeating that his government had delivered on its promises and had followed through on its red book plan, and so on. In their red book-as you can see, I have read it because I am familiar with the lies it contains-, the Liberals promised to convert military bases into peacekeeping training and staging centres. A program is like a contract and when one fails to meet the terms of a contract, one must pay a penalty.

The Liberals did not promise to close military bases. They promised to convert them into peacekeeping training and staging centres. So, what did the government do? It closed some bases and consolidated others. As a result, jobs have been lost.

I would like to ask the hon. member, through you, Mr. Speaker, if the government gave any thought at all to the cost of redeploying thousands of military personnel who will have to be moved and reassigned? Did it give any thought at all to number of direct and indirect jobs that would be lost as a result of base closures? The government talks about job creation, but what I see are job losses.

In an editorial, Lise Bissonnette stated the following: "In five years, once the dust has settled, DND will not even have saved $1 billion. Not even $1 billion after five years. The figure will be more like $850 million. However, for the communities in which the designated bases are located, economic activity will grind to a halt. Everyone will feel the effects: the corner store, the movie theatre, the school and the restaurant. Activity will come to a standstill because direct and indirect jobs will be lost". That is the first part of my question.

The second part has to do with the promises you made. Did you promise during the election campaign to tax the elderly? Did you promise during the election campaign to penalize the unemployed? Did you promise during the election campaign to extend the wage freeze in the public service? Did you promise during the election campaign to close military bases? These are my questions, Mr. Speaker.

[Paul Devillers, Liberal, Simcoe North, ON]

Mr. Speaker, I do not think I have enough time to answer all of these questions.

I am sure the hon. member knows that the red book contained many promises. The present action taken in the budget with respect to the military closings was not an action taken lightly. It results obviously in some unemployment for people who are affected. The minister of defence has assured us that there will be early retirement packages available as well as relocation packages, et cetera, to try to deal with that. But the more significant issue is that the funds that are being saved by these cuts, which we are informed should have been made years ago and would have been easier to make at that time, are being reinvested into the programs, some of which I listed at the beginning of my speech, where there would be a better return for the job creation that is required than to continue to fund the military establishments that are no longer useful.

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, I have a few points I would like to raise in response to the hon. member's speech in defence of the budget.

He took great pride in talking about the new programs that are being introduced in the budget. This was presented by the Minister of Finance as being a tough budget. Yet 18 new programs are being introduced. We have gone 125 years since Confederation without these programs. This was supposed to be a tough budget and here we have the government starting off and spending on programs in brand new areas.

I have another point, and it is the one to which I would really like the member to respond. He said we have an income crisis and not a spending crisis. The country is $500 billion in debt. Canadians are groaning under the weight of taxes they can hardly afford to pay. I would like him to tell us why he thinks we have a revenue crisis rather than a spending crisis.

[Paul Devillers, Liberal, Simcoe North, ON]

Mr. Speaker, the definition of a deficit is the difference between incomes and expenditures. My position, and I believe my party's position, is that we can increase our revenues. Government obtains revenue from taxation. The problem is we do not have enough people paying taxes because of the unemployment rate.

The measures being implemented through the red book program and through the budget are designed to get more people employed so that we can broaden the tax base, have more people paying taxes, not people paying more taxes. That is the object of the budget.

[Michel Daviault, Bloc, Ahuntsic, QC]

Mr. Speaker, as a Montrealer from way back who represents Ahuntsic, a Montreal riding, I would like to talk about my city, the city of Montreal.

A number of years ago when I was still in elementary school, our teachers taught us, with barely disguised pride, that Montreal was Canada's metropolis. We were the residents of a city that was Canada's financial and banking centre. The port of Montreal was Canada's major port, handling goods from Ontario and the Prairie provinces and imports from Europe and Africa. Those were the good old days, but times have changed.

Montreal has now become this country's poverty capital. In the metropolitan area, 18.5 per cent of households live below the poverty line. And with the first Martin budget, Montreal has become the capital of despair. During the past ten years, poverty has been gaining ground, and not only undermining the moral of Montreal's residents but also their ability to face the major challenges it must overcome to be competitive on the market. Business arteries formerly crowded with shops, boutiques and markets, now show signs "for rent", "going out of business" or, tersely, "bankruptcy". I am not dramatizing at all. This is a fact of life in Montreal.

But what these shop windows tell us reflects only a fraction of the experience of Montreal residents. According to a study conducted by United Appeal to improve the way it targets funding to the neediest in the organization's territory, half the low-income residents surveyed in the United Appeal's territory live in the city of Montreal. Montreal Island has a poverty rate that is higher than the average rate for the greater United Appeal district, which also includes the suburbs. In Montreal, Montreal North, Verdun and Ville-Saint-Pierre, one resident out of three lives below the poverty line.

I may add, for the benefit of the Minister of Finance, that his own city and his own riding has been struck by poverty as well, since one resident out of four in Ville LaSalle lives below the poverty line.

This is the same minister who gave us a budget that, ostensibly to give the economy a boost, takes the money out of the pockets of those who need it most. They do not need the money to put into family trusts and save on their income tax or to compensate for the fact that they can no longer deduct their business lunches. They need the money for food, clothing, shelter and health care.

Not so long ago, when he was meditating on the opposition benches before becoming Minister of Finance, this is the same person-although he seems to have forgotten this, as we saw in his first budget-the same person responsible for the economic development of greater Montreal, who wrote in La Presse on June 8, 1992, in referring to Montreal: ``As the economic heartland and a major development force, the Montreal region must be given a boost very quickly, otherwise its economic decline will be that of Quebec as well''.

Why did the minister not introduce the kind of measures he proposed last June, which included upgrading or rebuilding infrastructures and a program for home renovation assistance, which, as he said quite accurately, generated jobs and would be very beneficial in an area like Montreal, with one of the highest tenancy rates in the country? Since the only existing renovation program, the Residential Rehabilitation Assistance Program, is intended not for tenants but for owner-occupants, one wonders who had the most powerful lobby.

Why did the same member, who is now the minister, not talk about creating super economic incubators and implementing a policy for renewal of growth sectors in the manufacturing industry in partnership with Quebec and the city of Montreal?

These are all former proposals made by the minister. Was it all just a fantasy? What happened to the promise he made with other Liberal candidates last October, a promise that included investing $250 million in research and development in Quebec, mostly in Montreal? What happened, since everyone agrees Quebec does not get its fair share of spending on research and development?

How could they promise such measures and many others it would take too long to mention, and not take concrete steps in the Budget, at a time when we are witnessing the pauperization of Montreal? And what are the consequences, in the near and not so near future, of a deteriorating financial situation in a city of 1.2 million with an unemployment rate that rose from 9.1 per cent in December 1989 to 13.8 per cent in December 1993, higher than the unemployment rate in St. John's, Newfoundland during the same period, or in Toronto, where the unemployment rate rose from 4.1 per cent in December 1989 to 11.5 per cent for the same period?

One of the more obvious signs of poverty is reflected in the housing situation, shelter being a very basic need and extremely important in a country like ours with its severe winters-some-

thing we can certainly see these days-like the winter we are going through, which may end some time this spring?

But seriously, the housing situation has been discussed many times in this House, and with good reason. It is a good way to assess the poverty level of a city or any other community. In the last census, we get a very good picture of the rental housing situation in Quebec and Canada. In Toronto, 62 per cent of all units requiring major repairs were occupied by tenants. In Montreal, the figure is about the same, that is, 59 per cent; it is 58 per cent for Ottawa-Hull and 54 per cent for Vancouver.

In Montreal, families in rental housing live in appalling conditions. One household out of three spends more than 30 per cent of its income on accommodation, and one household out of six spends more than 50 per cent. Nearly 20,000 people are considered homeless. According to the Montreal Municipal Housing Bureau, 10,000 households or about 20,000 people are on the waiting list. Most of the requests for low-cost housing come from seniors, single-parent families and people with disabilities, that is to say the most vulnerable segment of our society.

Last Tuesday, merely two hours before the budget speech, when I inquired about the lack of social housing, the Minister of Public Works, who is responsible for the Canada Mortgage and Housing Corporation, asked me to be patient, that I would have an opportunity to review the decisions of the Minister of Finance once he had delivered his budget. The fact of the matter is that there is nothing for social housing in that budget.

In Montreal, 63,280 households pay in excess of 50 per cent of their income in rent. That is about one tenant household in five, or 19.1 per cent. Montreal is the Canadian city with the highest number of tenant households paying over 50 per cent of their income in rent, with 19.1 per cent, as compared to 14.5 per cent in Ottawa and 16 per cent in Toronto.

One third of all tenant households forced to devote in excess of 50 per cent of their income to housing, or 194,225 households, live in Quebec, as compared to 583,705 in Canada. With a much larger population, Ontario has about the same number of households in the same predicament: 194,920 households, in a much larger population. There are 77,120 such households in British Columbia.

To complete this list of sad statistics showing the poverty level in Montreal, we must take a brief look at Montréal-Nord, a city represented by Mr. Nunez, the hon. member for Bourassa, a neighbouring riding. The level of poverty in Montréal-Nord is such that experts warn that it could turn into a social tinderbox. In Montréal-Nord, a very cosmopolitan city, 10,500 households, nearly 42 per cent of all tenant households, spend more than 30 per cent of their income on housing, while 22 per cent spend over 50 per cent. These figures reflect a completely absurd situation.

Again, it must be pointed out that, last October, the Minister of Finance, like the rest of the Liberal candidates, had promised to support co-ops and non-profit organizations involved in providing social housing.

At this point, I must quote statistics from the Co-operative Housing Federation of Canada. In 1992, there were 17,400 housing units in Quebec versus 35,000 in Ontario; 17,400 versus 35,000. These figures show once again that Quebec does not get its fair share. One out of two is certainly not a prorated share. This is no doubt another good example of the fairness of the federal system.

Why is it then that the Minister of Finance wrote a coalition of organizations involved in social housing and told them that it was up to the federal administration to ensure that over one million Canadian households have decent and affordable housing? I hope that our colleagues will ask questions about the RRAP program, so that we can cover that aspect as well.

How can a nation which calls itself civilized and boasts that it is the best in the world, as our friends have told us repeatedly, see the desperate situation some of its citizens, people just like you and me, are in because they are unable to find work or have lost their jobs and have us believe that taking $5.5 billion away from the unemployed over the next three years will help put Canada back to work? It is surrealistic. By failing to tackle the deficit directly by reducing duplication and overlap, of which we still do not fully appreciate the magnitude, failing to even impose minimum tax on large corporations and getting cold feet when it should cut federal operating expenditures, the government made the conscious decision to get the money it needed out of the pockets of the most vulnerable members of our society.

With the qualifying period for unemployment insurance benefits increased from 10 to 12 weeks, chances are that all those whose work is seasonal in nature, like farmers, fishermen, gardeners, waiters and waitresses, and summer camp workers, or do contract work, which is the only way for many young professionals to earn a living, will be greatly penalized. Again, the hardest hit by the measures introduced by the Minister of Finance will be the people who already have an employment problem.

Furthermore, beginning unemployment insurance reform before the vast consultation to identify the people's needs even begins will have a downright disastrous effect on the provinces' finances. These measures will put more people on welfare, at provincial expense; the provinces in turn will be forced to cut their programs as a result of the freeze on transfers to the provinces. Part of our deficit is being shifted to our neighbours,

while their funds to meet the resulting new needs are cut. The situation is most alarming. It is quite a program.

Just think that during the election campaign, the Liberal Party spoke only of employment and equity, and this budget provides no remedy for unemployment and poverty; it only offers short-term jobs, which we hope will last at least 12 weeks so that these workers qualify for unemployment insurance. It is clearly insufficient for restoring the dignity of people without work.

The unemployed, especially jobless women, seniors and the poor will pay the price for the Liberal government's social spending cuts. The Minister of Human Resources Development, whom I would call Mr. Axe, tells us that the social program review could lead to more cuts. What an indecent turnaround in the Liberals' social positions from the time they were in opposition until now, when they are in power. Unemployment insurance cuts lead to more people on welfare, the present Deputy Prime Minister said in 1992. Unemployment insurance cuts lead to more people on welfare! She was in the opposition then. If you raise your eyebrows, you can check the news on the French network of the CBC yesterday; it ran that newsclip.

These new cuts still mean shifting the deficit to the provinces. Freezing transfer payments costs the provinces $2 billion more. Montreal is seriously ill, but the Liberal government is still cutting a little more of the oxygen off from its disadvantaged population. We have to thank the Liberals for their generous program of collective impoverishment.

[Bill Graham, Liberal, Rosedale, ON]

Mr. Speaker, I want to thank the hon. member for his eloquent speech and for his description of a city that has fallen on hard times. Many of us who live elsewhere in Canada also find this situation very distressing. I was born in Montreal, but have lived many years in Toronto. I also taught at McGill University and at the University of Montreal. I do have a question for my colleague and I ask it of him humbly and with no malice. Will he not concede that the problems experienced by the big city of Montreal, which should be a prosperous city after all, are due to his own policies and threats of independence? In order for a city to be prosperous, it needs to attract investment. Investors are shying away from Montreal. Even Montrealers themselves refuse to invest their money because they fear the current policies. You are responsible for creating this situation, and we are having to pay for it. This budget attempts to correct the imbalance created by your own policies.

Montreal first lost its advantage over Toronto when Mr. Lévesque was elected. I remember, because I living in Montreal at the time. We can trace everything back to this time. That is when Montreal lost its edge over Toronto. People in this world are free to do as they please. They are free to leave, free to travel, free to invest their money wherever they want.

I would like you to be honest and to ask yourselves whether your sovereigntist policies encourage investment in Quebec or whether in fact your policies are responsible to some extent for creating the problems which you have so sadly ascribed to us. I put this question to you very humbly, as all Canadians are very fond of Montreal.

[The Deputy Speaker]

Please address your remarks to the chair.

[Michel Daviault, Bloc, Ahuntsic, QC]

Mr. Speaker, through you, I thank the hon. member for his nice comments. Earlier I quoted unemployment figures from 1989 to 1993. As far as I know, there was no sovereigntist government in Quebec at that time.

I would like to talk about a study done by Professor William J. Coffey and Mario Polèse-it could be tabled if someone asks for a copy; this document is available at the Library by the way-on the city of Montreal; it is called Le déclin de l'empire montréalais: regard sur l'économie d'une métropole en mutation . The authors are not sovereigntists. Their analysis shows that Montreal's decline is mainly due to what they call the loss of the hinterland. The market gradually moved to Toronto. Our industries got older. The Lachine canal region, which was a cradle of industrial development in Canada, is sinking into obsolescence; major investments are needed to revitalize it.

I was involved in creating an association to promote economic development in Montreal. In the end, we must take ourselves in hand at the local level and this, in turn, will lead us to do the same at the national level. I am a Montrealer and a "Montrealist" and, in that sense, we cannot propose to use the means at our disposal while leaving important tools in the hands of the federal government, which does a very poor job of managing them.

During question period this afternoon, the minister, in a flight of partisan oratory, talked about the RRAP. The RRAP was supposed to be a social housing program. The first part of the program is aimed at homeowners and the second part, at handicapped people. The part of the program designed for handicapped people can be compared to social housing, obviously.

We know that Montreal has a problem, mostly because of single parent families and the large number of new residents, who often live in apartments. Toronto probably has the same problem to some extent. But these people are not eligible under that program.

This government, which was a great advocate of social housing when in opposition, throws us a few peanuts and tells us

it is providing social housing; it is outrageous. When the minister adds that we should applaud the Minister of Finance, who is responsible for Montreal's economic development, that is the last straw.

So this study, that will be made available to you-again, it is called Déclin de l'empire montréalais -identifies the Quebec political option as a minor factor. It is a minor political factor at this stage. I would guess that William J. Coffey is not a sovereigntist.

It is important for Quebec's main city to give itself tools and to recognize that these tools must belong to the Quebec government. The federal government did not fulfil its mandate and I myself have lost hope.

In 1988, I was among those who supported the Conservatives for the nice worth-

[An hon. member]

Chrétien nixed that one.

[Michel Daviault, Bloc, Ahuntsic, QC]

The "beau risque", as we say in French, did not work. Even Bourassa's five minimum conditions did not work. To start with, these five minimum conditions with a patriation of power, respect for our jurisdiction, even that did not work. The government tells us that as far as the Constitution is concerned, it is business as usual, the problem will disappear by itself. That is not true. The federal government is involved in all spheres of activity. There is not one department, except possibly defence, where it is not involved.

The economic development projects that it presents to us, the Youth Corps program which resembles Katimavik is a provincial program. It has no business being there. This is a cultural program, an educational program, it has no business being there.

As for occupational training, no subject brings such nearly unanimous agreement among Quebecers. Even the very federalist Conseil du patronat and its president, Ghislain Dufour, who is not a sovereigntist, agree. It is up to the SQDM, the Quebec labour development corporation, to act in this field. When we get to this point in other subjects, we can raise specific issues where the federal government does not even recognize programs that qualify for the SQDM, there is all that duplication. We are wasting our energy while we cut help for the unemployed. You said yourselves that by cutting unemployment insurance, you would put pressure on welfare. Now that you are in power, you say the opposite.

[Fernand Robichaud, Liberal, Secretary of State (Parliamentary Affairs)]

Mr. Speaker, I find it very depressing to listen to the speeches of Bloc Quebecois members. They are painting a very gloomy picture of Quebec and making it out to be the most miserable place in the world. Truthfully, I would be most unhappy if I had to live there.

Would Bloc members not be better off singing the praises of Quebec expertise, and giving examples of the achievements of Quebec industries which are recognized around the world? Does the hon. member not think that if he spoke in a more positive tone, if he praised Quebec's merits, then businesses would consider relocating to the province, which would result in job creation and improve the lot of Quebecers? Does he not want the same thing as we want?

[Michel Daviault, Bloc, Ahuntsic, QC]

I thank the hon. member for Beauséjour. Indeed, entrepreneurship in Quebec is alive and well. In my riding, attempts were under way for many years to set up an economic development corporation. Federal and provincial members of Parliament and municipal councillors persisted in telling us that this was impossible. But, we took matters into our own hands and established such a corporation, because we had the will to succeed.

There are many examples of similar successes at the provincial level. However, we also encounter obstacles and when I spoke about unemployment insurance in particular, I mentioned that we needed some oxygen. Until such time as all of these problems are resolved, and the Minister of Human Resources Development sits down with his provincial counterpart and settles the question of manpower training as best he can, until such time, we need some oxygen in Montreal to help the disadvantaged who are gasping for breath.

This afternoon, the minister quoted from a newspaper clipping. Undoubtedly, he overlooked an article on unemployment insurance which appeared on page C-1 of today's edition of La Presse . It quotes Mr. Claude Forget, a former provincial Liberal minister who once put forward a major proposal for unemployment insurance reform.

Mr. Forget is reported as saying that the introduction of a different benefit level for persons with dependants will complicate matters and increase the costs of administering the legislation which is already highly complex.

With two different benefit levels, namely 55 per cent and 60 per cent, the system will be absolutely impossible to administer. This will create major problems and complicate the system. In addition, as reported on page C-3, the budget proposes vague fiscal measures. Even the experts are confused. Moreover, it is reported on the front page that Mr. Paul Martin was visibly disappointed with the frosty reception given to the government's financial plan and was prepared to accept part of the blame.

Perhaps the most interesting of all the articles appearing in La Presse -

[The Deputy Speaker]

Order, please. The hon. member's time has expired. We will now proceed to debate.

[Harold Culbert, Liberal, Carleton—Charlotte, NB]

Mr. Speaker, I rise on a point of order. Concerning the previous speaker's presentation, one of the things I noted, and I believe I noted it correctly unless it lost something in its translation to me, was his reference to a very distinguished and honoured minister of this House, whom I believe, if I am not mistaken, he referred to as Mr. Axe. That was the translation I got. I do not think that was the intention of the hon. member but if it was I certainly suggest that this House take an action.

[The Deputy Speaker]

I take it that was a point of order. The test of a point of order is whether it is disruptive in the House. Although the member just raised the point of order, I did not take it as being a disruptive comment.

If I find otherwise I will come back to the House with respect to words that have been ruled to be unparliamentary. Having read Beauchesne several times, I am not sure that Mr. X is an unparliamentary word, but I will be happy to look at it and report back to the member.

[John Finlay, Liberal, Oxford, ON]

Mr. Speaker, I rise today as the elected member for the Oxford riding to make my maiden speech in this elegant and venerable chamber. When I visited this place as a high school student some 50 years ago, I little thought that I would have the opportunity to address my hon. colleagues as a member of Her Majesty's government. However, that day has arrived and it is an intensely moving experience for me.

I am proud to represent all the citizens of Oxford riding and Burford Township and I thank them for giving me the opportunity to serve them and Canada.

Oxford County and Burford Township, which make up the riding of Oxford, are situated in the agricultural heartland of southwestern Ontario. It is not as rugged as Alberta or B.C., or as expansive as Manitoba or Saskatchewan, nor does it have the rocky coasts and oceans of maritime Canada. It does have the pastoral beauty, character and history of many predominantly rural ridings in central Canada.

Agriculture is the backbone of our communities. We have tobacco farms in the southern part of Oxford around Tillsonburg, which is a progressive town, supporting factories, supplying parts to the automotive industry. Tillsonburg is also the headquarters of the Flue-Cured Tobacco Growers' Marketing Board.

About 25 kilometres north of Tillsonburg is the town of Ingersoll, the home of the huge, modern General Motors Suzuki automobile plant known as CAMI.

The county seat is in the city of Woodstock, population 30,000. It is the administrative centre of Oxford County and has many factories serving the automotive and trucking industry, as well as several concrete fabricating plants, foundries and metal machining factories. The linings for the new Detroit River tunnel are being fabricated in Woodstock.

Woodstock is proud to be called the dairy capital of Canada and its symbol for the last 50 years is a holstein cow, Springbank Snow Countess, owned and milked by Tom Dent, a former Speaker of the legislative assembly of Ontario between 1943 and 1955. A life size statue of Snow Countess stands proudly beside the highway just as one enters Woodstock from the east.

I could wax eloquent about the hundreds of well kept dairy farms throughout Oxford County and Burford Township. There are also cash crop farmers, pork producers and chicken farmers. In fact, Cold Springs Farms of Thamesford is one of Ontario's largest turkey producers and processors.

Burford Township boasts some high tech factories and an outstanding research farm. Just north of Woodstock is the Western Ontario Breeders Incorporated which collects, tests, stores and sells semen around the world for the artificial insemination of cattle.

Oxford, my hon. friends, was the birthplace of some interesting historical characters. Aimie Semple MacPherson, the California evangelist, was born and raised near Ingersoll. A woman with a less admirable but no less colourful life was Cassie Chadwick, the famous con artist who lived very high off the hog in Cleveland, Ohio by pretending to be the illegitimate daughter of the New York City millionaire Andrew Carnegie of library fame.

On the male side, "Colonel" Joe Boyle, the saviour of Romania, was a Woodstonian who made a fortune from hydraulic placer mining in the Klondike following the gold rush. He equipped his own machine gun battery of ex-mounties and miners and transported them to France in the first world war. He was sent to Romania and Russia to reorganize the railroads. He rescued the crown jewels and 20 million in currency for Queen Marie of Romania from the Kremlin during the Bolshevik revolution.

His bones were returned to Woodstock several years ago and reburied. The Reverend John Davies of old St. Paul's Anglican Church in Woodstock, who lived to be 101 and who had known Joe Boyle in the Klondike, presided at the reinternment.

I will just mention some other heroes. The Mighty Men of Zorra, the tug-o-war team which won the world title at the Chicago World's Fair in 1893, was commemorated last year on July 1 at the Annual Highland Games in Embro by an international tug-o-war contest. The anchorman on the 1893 team, Robert MacIntosh, had a chest expansion of 52 inches.

Last year the unlimited class hydroplane, Miss Canada IV, was returned to Ingersoll to the Centennial Park Museum by Harold Wilson, its owner and driver. Miss Canada IV broke Sir Malcolm Campbell's world speedboat record in the 1930s.

I want to share with my hon. colleagues some of the things I believe about this country. I believe passionately in this country. I agree with the view expressed two weeks ago by one of the hon. members opposite who said there were three founding realities in Canada's past, the aboriginal people, the French and the English.

My hon. friend from the Bloc went on to point out very rightly that now more than one-third of Canadians, 12 million in fact, are neither aboriginal, English nor French, but come from many cultures and races.

I would like to remind all hon. members that 52 per cent of Canadians are women.

I am proud to espouse the Liberal philosophy and to be part of this Liberal government. Our members represent people from one end of this great country to the other, both ways, and bottom to top.

Just look at the diversity along these government benches and across the way in the rump corner. Nearly every one of the ethnic groups which make up this country is represented in this government. We have not yet achieved parity in representation for women. Yet, 37 Liberals out of the 52 women members in this House is a great improvement over the last government.

I believe that Canadians want this government to succeed. They want to help Canadians get back to work. They want an equitable tax system in which everyone pays their fair share.

They want a revised safety net of social programs which is affordable, makes sense, and serves all those who need it but not those who do not. The people want us to govern firmly. They want peace, law and order. They approve of the Prime Minister's multifaceted and firm approach to the tobacco smuggling problem. They want a searching review of the Young Offenders Act and our parole system with respect to serial killers and violent sexual offenders.

This government committed itself in the throne speech to a more open process and more power to the backbenchers on both sides of this House. I would remind the hon. members opposite that provincial governments are just as guilty of overlap and unnecessary duplication of programs as the federal government ever was.

In this first budget presented by the hon. Minister of Finance we have fulfilled another promise from our famous red book.

This budget will stimulate small and medium size businesses to undertake new ventures and test new markets. It will reduce significantly government spending on inefficient and non-productive programs. It will force a thorough review of all our social security programs and our defence department's role to make sure that we can deliver the programs we need efficiently and effectively.

The budget does broaden the tax base and stops up loopholes in the tax system. It collects more taxes from large corporations and the rich. It will reduce the unemployment insurance premiums to help small business expand.

It lengthens the minimal work requirement and lowers the percentage benefit for all except those who have dependents and need.

There are many other provisions which reduce government spending.

In conclusion, I give a quotation from Sir Wilfrid Laurier which I would ask all hon. members to ponder, particularly those in Her Majesty's Loyal Opposition from Quebec.

In 1911 Sir Wilfrid said:

I am branded in Quebec as a traitor to the French and in Ontario as a traitor to the English. In Quebec, I am branded as a jingo and in Ontario as a separatist. In Quebec I am attacked as an imperialist and in Ontario as an anti-imperialist. I am neither. I am a Canadian. Canada has been the inspiration of my life. I have had before me as a pillar of fire by night and a pillar of cloud by day, a policy of true Canadianism, of moderation, of conciliation.

I honour the spirit of Sir Wilfred and I commend his balanced and zealous view of this great country to all honourable members.

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, I offer my congratulations to the hon. member for Oxford on his maiden speech in the House. We are delighted to hear about the many facets of his riding and I can see that he has much to talk about.

On the budget, about which he did not have too much to say, he seemed to emphasize the fact that he was proud of his government's attempts to broaden the tax base and close the loopholes and perhaps raise taxes and so on.

I was wondering if he would agree with the previous speaker with whom I took issue who said he thought that we did not have a spending crisis in this country but that we had a revenue crisis in this country.

The hon. member seems to think that we should be raising more taxes. Again, I ask him the same question I asked the previous speaker. Does he think that while Canadians are groaning under the massive weight of taxes in this country, and while we are $500 billion in debt, we should not look at cutting spending and cutting that spending dramatically rather than trying to squeeze another dollar out of the Canadian taxpayer?

[John Finlay, Liberal, Oxford, ON]

Mr. Speaker, I appreciate the comments of my hon. colleague. I am glad that he found some of the comments about Oxford interesting.

With respect to the budget and his very appropriate question, we must not forget that this budget cuts $5 in spending for every $1 it takes in through taxes or other payments.

I agree that the Canadian people do not want any more taxes. I said that they wanted a tax system that is equitable and in which those that can pay their fair share. I do not think this budget goes as far in this regard as it can. I remind the hon. member that the matter of family trusts is being taken up by a committee and that there are other changes that the finance minister pointed out would be dealt with in future.

[Ghislain Lebel, Bloc, Chambly, QC]

Mr. Speaker, I speak out against what the hon. member opposite said about duplication being the provinces' fault. It has been more than 50 years since he attended high school and he needs a refresher course.

I wonder if the sharing of constitutional jurisdiction has any meaning for him. Originally, four provinces agreed to share certain powers, but never ever did they think that they would give up their own powers which belonged to them and which they needed for their own development within the Canadian Confederation. So there is something wrong with that.

If there is duplication, it is because the federal government has always been meddling. The provinces did not middle in the national defence of Canada, the provinces did not meddle in foreign trade. It is downright wrong. We have been hearing that since this morning, so we should set the record straight.

As for job creation, 99 per cent of Canadian businesses have fewer than four employees. There are 1,114,000 self-employed people who work for their own business; that is not a lot. They play with figures to suggest that taxes for those people will be reduced from 28 to 12 per cent, when in reality their tax rate is 12 per cent. Those people have an awful time making ends meet.

Does the minister know that while he was telling us such nonsense, the national debt is costing us $75,000 a minute, and for the four or five minutes he took to tell us such rubbish, we are some $275,000 worse off than when he started to speak? He should be aware of that.

[John Finlay, Liberal, Oxford, ON]

Mr. Speaker, I think there were three or four questions there. There were a couple at the start. I might remind my hon. friend that while death and taxes may be sure, the other sure thing in this world is change.

When the Constitution was written we were not flying across the ocean in six hours. We were not flying from the capital to Vancouver in four and a half hours. We were not picking up the telephone and calling our offices at home. There was no such thing as electronics, fibre optics and a lot of other things we now have. The Constitution did a good jobs in those days for what people knew.

I suggest to my hon. friend that he has to keep up with the times. We have the problem of airlines and telecommunications. These things need new approaches.

[Bernie Collins, Liberal, Souris—Moose Mountain, SK]

Mr. Speaker, I commend my colleague from Oxford for his maiden speech. It was very well done and certainly very timely in this Chamber.

As I rise this afternoon to place some comments before this House with regard to the budget of the finance minister, I think that it is a credit to the people of Canada that they elected the government they did that keeps its promises.

Within four months every single item we proposed in the red book has been met or budgeted for. I can tell my constituents in Souris-Moose Mountain that there are no new taxes. For farmers and small business in my riding, it is good news. They were concerned over the $500,000 capital gains provision, that it not be touched.

For many farmers their farms are their pension plans. The exemption is a legitimate means of financial security. This budget is an investment in the future of Canada. It is fair, it is pragmatic and it is progressively oriented.

I was very pleased that agriculture was given careful consideration in this budget. Again the citizens of Souris-Moose Mountain are greatly affected by the agricultural industry. Every livelihood in our riding is affected by it.

It therefore pleases me very much to see that many programs affecting the industry were kept in place. The people of Souris-Moose Mountain are responsible and they are compassionate people. They want to contribute their share to this country, to the reduction of the deficit and to the development of our economy. They are willing to shoulder their share of the burden. However, they want to know that the contribution they make is handled responsibly by this government.

That is what pleases me about this budget. It is a balanced responsible approach to problems of the future. We are reducing the deficit while stimulating jobs. We are supporting those in need while closing loopholes and eliminating waste. We are putting our own house in order, just what my constituents asked us to do.

In that same spirit of co-operation and contribution my constituents are saying to me with respect to agriculture that they will make their contribution but we should handle things responsibly, guard the industry from disaster and collapse.

This budget is addressing those concerns. Although grants and contributions will see a 5 per cent across the board cut, essential agricultural insurance programs will not be affected. The gross revenue insurance plan, the net income stabilization account and crop insurance were exempted from these cuts. This is very good news for the people of my riding. They have been severely affected by circumstances far beyond their control in the field of agriculture. The exemption of these programs from the restraint measures is much needed and appreciated.

As well the finance minister has announced that there will be a study of the taxation of capital gains as it applies to small business and farmers. We have been given assurance by the minister that no changes will be made to the current exemption without the agreement of the farming community.

The grain farmers in my riding have one concern. That is with regard to cuts in the Western Grain Transportation Act. The report of the producer payment panel is still outstanding. The agriculture community would like to have a chance to agree on a new process before any cuts to this program are made.

With respect to the impact of the budget on growth and jobs, the budget provides funding for a number of programs mentioned in "Creating Opportunities" which will create jobs immediately and build the foundation for job creation in the future.

The infrastructure program is now being implemented and agreements have been signed with every province. Over the next three years the programs will create 50,000 to 65,000 new jobs. There are other initiatives in the budget that offer hope to young people. For example, the Canadian Youth Services program will put together a place where young Canadians get meaningful work experience and develop personal skills.

In addition, new youth internship programs will be developed with the province which will help to provide young people with alternative training.

It is important to note that there are no changes to the access to RRSPs for first time home buyers. That was a major concern to the people of my constituency and one that the budget delivers well on.

With respect to social programs, I am very pleased that the government intends to overhaul Canada's outdated social security system within two years. It will build bridges to work and support independence and not dependence. The budget calls for an investment of $800 million to test innovative new approaches to release Canadians from dependency and get them back to work.

As promised in the government's platform, the budget provided funding for the aboriginal head start program, a centre for excellence for women's health, the creation of the Canadian race relations foundation, the reinstatement of the law reform commission and the court challenges program and a prenatal program for low income pregnant women.

As an alderman and a former mayor of the city of Estevan, I have always believed in fiscal responsibility and fiscal restraint. This budget addresses both. For every dollar raised in new revenues, the government will cut $5 from government spending, resulting in a $23 billion cut over three years. The cancellation of the EH-101 helicopter added another $1.7 billion over three years.

In addition to focusing on fiscal restraint, we also have focused on budget loopholes. Through incentives we are going to bring together fairness to Canada's tax system.

The corporate income tax deduction for meals being reduced from 80 per cent to 50 per cent is a good direction to travel in. The $100,000 capital gains exemption which primarily benefits high income Canadians is eliminated immediately, another right direction.

The Liberal government promised to create jobs and to this end the budget addresses economic renewal. We encourage innovation and technology development and the government is supporting the vital small business. Canada's investment program, venture capital, and Canada's technology network program are excellent moves.

For years governments have promised more than they can deliver and delivered more than they can afford. We are confronting a deficit head on. In three years we will reduce that deficit from $45.7 billion to $32.7 billion. As a government committed to cutting expenditures, we intend as an example cutting $3 billion from government operations and putting on salary freezes.

Finally, with regard to UIC, the move from $3.07 to $3 will add $300 million for new investment by small business.

I want to assure this House and all Canadians that we will be taking home the gold. Never has so much been done by such a finance minister as the present Minister of Finance. I am pleased to stand here and support the budget this evening.

[Randy White, Reform, Fraser Valley West, BC]

Mr. Speaker, I congratulate the hon. member on his speech. I would like to once again try to put some logic into this infrastructure program.

The infrastructure program is supposed to have $2 billion coming from the federal government, $2 billion from provincial and $2 billion from municipal. Municipalities will charge residential tax and the provincial probably an income surtax and so on.

I wonder if the hon. member could enlighten us as to how long these infrastructure jobs might last, how he sees the logic in spending $6 billion for that duration of those jobs and how will it be recovered.