Mr. Speaker, in entering this debate on Bill C-3, an act to amend the federal-provincial fiscal arrangements, I want to focus on two things. First, I will make some comments on the bill and equalization and, second, look at equalization in other areas of governments in reference to the formula that we are establishing today.
The bill has two basic purposes. The first purpose is certainly to try to eliminate the disparities that may exist among the provinces. The second is to design a formula for the redistribution of federal taxes to these seven provinces; some $8 billion in the early stages and as we move to 1999 some $10.4 billion.
There are some positive aspects of the bill as I examined it. First, the bill does have the support of the provinces of Canada and that is significant in itself.
Those who have worked at official levels and at ministerial levels have worked it through. They have reached agreement with the provinces and the provinces support the equalization formula that is here and the basic concept. That is important as we as legislators pass this piece of legislation.
The bill is an attempt to reduce fiscal disparities among provinces. As my colleague from Calgary said earlier in the House, basically we as the Reform Party support that objective.
I look back at my own history as a legislator and think back to the 1960s when I entered the legislative assembly of Alberta. This program, as we all recognize, came into effect in 1957. It was in its early stages of maturity and understanding in the mid-1960s. I remember raising the question when I came into the legislature with the premier of the day, the Hon. Ernest Manning. I asked about the resources and the revenue of Alberta being distributed to the other provinces and on what basis we made that decision.
I recall the premier's comments very clearly at that time. He indicated to me that as a have province which has been blessed with natural resources, oil, gas, water and forestry, we have an obligation to help others not blessed with some of the same types of resources. That was the thinking of the fathers of fiscal arrangements with regard to equalization. I see in this bill the same type of thinking.
Another aspect that is positive about this bill is that the formula has a ceiling and a floor to protect the provinces from major revenue reductions and to protect the federal government at the same time from open ended growth in payments. There is also the tax back problem that is dealt with here in this legislation. That is positive in itself.
Still another aspect that is significant is that the payments are unconditional. When we transfer payments from the federal government to the provincial governments, and we expect it to bring about the most amount of equity possible, those dollars cannot have conditions on them. If they are targeted and have conditions on them, what we are going to do is build in another interface that will not allow for flexibility, priority setting and certainly the ability of the provinces to reflect the wishes and the needs of their respective electors.
On the other hand, as I look at this bill there are some concerns and questions I would raise. There are two questions. Can the federal government, under our present fiscal circumstances, afford to continue the current level of equalization transfers to the seven provinces? This House must answer that question.
It is more incumbent upon us than previous houses because we are faced with an upcoming budget. We are faced with a deficit, most likely in this new budget, of at least $38 billion dollars as I understand. In the current budget we are faced with $44 billion to $46 billion of deficit. We have an accumulated deficit of $500 billion and most likely if things continue as they are by the end of this 35th session the accumulated deficit could be $600 billion.
We must show respect for that. Our concern, as pointed out well by my colleague, is that we feel this is one of the areas where we should have reduced the cost of government and we called for a 10 per cent cut. That is a question that I raise in the House. The rest of the members should raise the very same one as we raise in the Reform Party.
The second question I want to raise is equally significant. Is there equality in the federal transfer payments to provinces beyond Bill C-3 which we are facing today? Is there equity built into other programs beyond Bill C-3?
I would again like to remind hon. members of the objectives of Bill C-3. The first objective is to transfer federal funds to the seven provinces to raise their per capita income to a representative sample of $4,800 on a per capita basis. The second objective, and this is from the material given to us in our briefing, set out by the government, is to enable provincial governments to provide their residents reasonable, comparable levels of public services at reasonable levels of taxation.
In other words, Bill C-3 is to create a level playing field across Canada. Every province has a somewhat equal opportunity to serve its electors with services that they need in terms of health, education and social services, supporting their highway structures, their infrastructures and so on.
It is to build in that level playing field. That is what we are doing with Bill C-3. I want to raise a point to put the government on notice, that when it moves into new program areas it keeps that understanding in mind. It is very important.
Government often forgets. I can give some personal experiences which I will in my remarks. We must think of the infrastructure program that we just announced to Canadians. We said in that infrastructure program that we would have a factor in there in terms of employment or unemployment that would allow some provinces to get more of the infrastructure dollars than others.
If we create equalization by Bill C-3, why then do we build that into the infrastructure program if it is not already there? We could look at retraining programs. One will find the very same thing.
I would like to look at a document that I received from the Privy Council just a few days ago. It is a good reference when I examine the question that I raised in this Parliament. This document is called "Federal-Provincial Programs and Activities: A Descriptive Inventory 1992-93". The Privy Council put it out as of November 1993. It is an up to date, current document that should be referenced.
How does one recommend it to all the members of Parliament? It is a document that I used many times as a leader of the opposition in the Alberta legislature to raise the question with the government at that time. I asked if it were receiving a fair share as Albertans from various federal programs. If one looks through the document one will find the answer to that question.
I would like to raise a couple of points. First there is the Canada Mortgage and Housing Corporation. I was one of the ministers from Alberta who negotiated Alberta's share of the moneys available through that program for housing in Alberta.
I remember sitting around the table and walking through those negotiations. I remember my attitude and it reflects on the question I raise here. My attitude at that time was that if some of the other provinces, the maritime provinces, Saskatchewan, or the Northwest Territories, required more funding to meet some of its social housing needs, I was prepared to be flexible, move on that and to give a portion of Alberta's moneys to them.
In other words I was saying because Alberta should have x per cent or whatever it is, 10 per cent or 11 per cent of the federal funding relative to our population, I was willing to give on that. I saw that there may be a need out there that needed to be met. There were less fortunate in terms of revenue than we were in the province of Alberta. I was willing to give.
As I look at this today relative to Bill C-3 and equalization, as a minister at that time I could have sat at the table and said equalization has occurred. We had a formula in place. Today we are putting through Bill C-3 hopefully to become legislation. We are going to put that in place.
Perhaps Alberta at that point in time should have received a percentage of the grant relative to its percentage of the Canadian population. Looking at the structure it does not quite work that way.
For example under the RRAP Newfoundland received $12 per capita, Alberta received $2.10 per capita, and Ontario received $1.85 per capita. The question is: After equity, should there have
been a $10 differential between Alberta and Newfoundland? Should the numbers have been skewed in that direction?
A second example is under transportation looking through the report I mentioned a few moments ago. Even under transportation there is disparity. For instance as noted in this report New Brunswick received $131.3 million under a program negotiated between 1987 to 1996 to do highway and transportation work. Nova Scotia, Prince Edward Island, Quebec and Newfoundland received millions of dollars to improve their highways. Yet when we look at Alberta, British Columbia and Ontario on the list there are no dollars for those respective programs.
The question is: Did we create equity by the formula to begin with or not? If we did, should we be allocating special funding over and above? Should not all provinces and all residents of Canada be able to receive the same type of treatment if equalization is real and that we do not have to keep shoring it up by giving political funds or other kinds of funds at a later date?
Another example cited in the document is that some provinces receive additional money for health and education. Special dollars are allocated. Around $1 billion is provided for what are called the seven less prosperous provinces, the same seven provinces that are receiving moneys through equalization.
As legislators and as people who want to create fairness, we want fairness. When Alberta, Ontario and British Columbia say that the formula is fine and that they are receiving no benefits, they should raise the question: Are the benefits after that of other government programs allocated fairly across this nation? We should ask that question.
Looking back at my own political experience provincially I raised this once in a while but not in the same context. I often look at provincial treasurers and those who negotiate at the table as to whether they ask the same question. If we created equality with Bill C-3, why are the other funds not allocated from the Government of Canada done equally for all Canadians no matter where they live?
We should think about that in this assembly as we proceed to the budget in the third week of February and look at the new programs and raise the question: Are all Canadians no matter where they live going to receive equal treatment, have equal access? Will each province have some equality in the distribution of the funds of that budget? If that is so, then we have improved the circumstances and we have made a contribution.
I am not always sure going back in history whether parliamentarians or governments look at it on that basis. It was often allocated for political reasons. Often there was this misconception that equalization had not occurred so some more would be added to some of the provinces that are called the have not provinces of Canada.
With those remarks, we in the Reform Party in general support the concept of equalization. We are concerned about the dollar amount of $8 billion and that there was not some kind of reduction. Because of that we are not going to be voting for the bill. The other concern I have is the one I raised about continued equalization and fairness in other moneys that become available for us to distribute as parliamentarians.