Debates of April 11th, 1994

Budget Implementation Act, 1994

[Albina Guarnieri, Liberal, Mississauga East, ON]

Mr. Speaker, perhaps the hon. member would like to elaborate, when he says that there should be substantial cuts, where these cuts should be made.

[Dick Harris, Reform, Prince George—Bulkley Valley, BC]

Mr. Speaker, I have been sort of struggling with a comment made by the chairman of the CBC on a panel show I watched a few weeks ago.

He made a statement which I believe was just incredible. He said that the CBC should not concern itself with economic viability but rather with delivering a Canadian culture to the Canadian people.

While that may be barely acceptable in traditional economic good times, I hardly think that this is a traditional economic atmosphere that we are enjoying right now. It may be tradition given the history over the last 15 years. It is all very nice to have an outlet or a means of conveying Canadian culture but when the government is borrowing well over $100 million a day to stay in business, I would ask the minister whether she thinks this is the time to separate our wants from our needs. To have this expensive albatross around our necks at this time is sort of like going downtown to buy a new television set when one does not have any food in the cupboard.

What does the government have in mind in trying to get the CBC on an economically viable basis rather than just a black hole in which to throw money?

[Albina Guarnieri, Liberal, Mississauga East, ON]

Mr. Speaker, I thank the hon. member for the instant promotion but I am a mere parliamentary secretary and not a minister. Thank you anyway.

The hon. member makes the point that there should be more food in the cupboard but to many people culture is a form of food and sustenance. It is the unifying link that binds this country together. The measure that the government has proposed and put on the table before members is very responsible. It is done with a view to ensuring that we are fiscally responsible. The money that we are proposing is money well spent.

[Michel Guimond, Bloc, Beauport—Montmorency—Orléans, QC]

Mr. Speaker, on Friday, March 25, my colleague, the hon. member for Mercier, addressed this House on Bill C-17. She asked members to adopt the following amendment: "That this House refuse to proceed with the second reading of Bill C-17, an Act to amend certain statutes to implement certain provisions of the budget tabled in Parliament on February 22, 1994; 1) given that the amendments to the Unemployment Insurance Act do not reduce the inequities between have and have-not regions in the country and contain no specific measures to reduce youth unemployment; 2) given that the amendments to the Unemployment Insurance Act do not cancel the increase in premiums paid by workers and employers in effect since January 1, 1994."

Today is the period allocated to ask the House to adopt this amendment. The reasons that led my colleague to present her amendment are increasingly relevant, and the population, particularly in Eastern Canada, clearly supports our demands. It is unacceptable to ask Atlantic and Quebec recipients to become scapegoats so that the current government can satisfy its appetite for rationalization in unemployment insurance as impartially as it does in this bill.

As my colleague from Mercier clearly stated in this House, we cannot ask Atlantic Canadians, who account for 8.5 per cent of the Canadian population, to accept cuts of 26 per cent of the unemployment insurance budget. We have the same problem in Quebec, where 25 per cent of the Canadian population will be hit by cuts of 31 per cent.

Quebec has known for a long time that the Liberal Party of Canada was going to impose such economic losses on Quebec if it came to power. It knew that the Liberal government would present bills allowing it to save $5.5 billion over three years and that the bill would be split inequitably among the provinces. In the proposals contained in Bill C-17, Quebec and the Maritimes end up with a large portion of the bill while western Canada and Ontario are much less affected.

Quebec knew that one of the first measures taken by the Liberal government would be to approve an increase of 7 cents in unemployment insurance premium rates, which it did on January 1, 1994, nine weeks after being elected. Quebec knew that this increase would eliminate 9,000 jobs. And to look good, this same government proposes to re-create these same 9,000 jobs in 1995 and 1996 by bringing premiums down to their 1993 levels.

The government gives with one hand what it took with the other and expects to be taken seriously. Quebecers were not fooled. They elected 54 members of the Bloc Quebecois to defend their interests, and that is what we intend to do here until Quebec becomes a separate country, and we demand that the redistribution of wealth, whether through unemployment insurance or any other social benefit, be fair until Quebecers hold all the levers of economic control and are masters in their own country, Quebec.

If Bill C-17 extends for two years the freeze on compensation for federally appointed judges, Parliamentary agents, the Governor General, the Lieutenant Governors and parliamentarians, fine, but it is not all right if it raises the premiums of workers whose buying power is already lower and the premiums of companies that already have trouble competing in a world of global markets; that is unacceptable.

However, the Minister of Finance had the opportunity on February 22 to present a budget for a fair redistribution of wealth by taxing the richest individuals and sparing the poorest. That is not what the Minister of Finance did. He presented a budget in which he projected a deficit of $39.7 billion for 1994-95, when the total debt has already exceeded $500 billion.

On March 7, I asked this House to fight the deficit and waste. I suggested to this House some ways to create permanent jobs and to improve Canada's finances. Today I would like to add some ways to reduce the deficit, improve our economy and make our people more secure, while redistributing our wealth fairly and equitably.

Let us look at water transportation. In his budget speech, the finance minister mentions the upgrading of ground transportation but fails to specify how it will be done.

Well before the advent of rail and air transportation or trucking, waterways were used by the early settlers. Canada goes from sea to sea and holds the largest bodies of fresh water in the world. A majestic river flows through it. Canadian harbours played a critical role in the development of Canada and Quebec. However, in recent years, the majority of ports have been experiencing serious problems.

And yet, waterways provide the most economical and the least polluting means of transportation. Our merchant marine has been all but abandoned and our shipyards are facing great difficulties, especially in Quebec. It is not a question of building ships just for the sake of it; indeed, we can and must build ships to lower transportation costs and preserve the environment we live in.

The development of Quebec City's harbour and most ports along the St. Lawrence Seaway is based mainly on grain transportation. Whereas western ports see their share of grain shipments increased, St. Lawrence Seaway harbours are nearly at a standstill. The problem is compounded by a drop in Russia's grain purchases due to an excellent wheat crop in that country. What are we to do in such a situation? We must find another vocation for our majestic river and our fresh water bodies. For example, cruises are an ever-expanding sector both in the

United States and in Canada. Some 7,500 people went on cruises ending in Quebec City this year compared to 4,300 last year. Is this not an exciting new niche for a country like ours? We could at the same time develop our merchant marine and give work to our shipyards such as MIL Davie, in Lauzon, which are world-renowned in their field.

I am making these constructive suggestions to the House because they were ignored in the budget speech.

Let us now look at duplication. Is it not time that agencies, departments and other government bodies be carefully reviewed to determine if they really offer an essential service? Is it not time for the various government levels to communicate with each other and put an end to duplication? Our party has been bringing tax shelters to the attention of this government for some time now, but they did not have the courage to abolish the real tax shelters of the rich, family trusts, for example. They prefer to postpone such decisions and let a committee study the question. However, the government did not ask a committee to examine the question when it decided to cut the tax credit for those 65 and over. They certainly know how to make decisions when attacking the have-nots! They knew very well how to go about it when they decided to cut UI benefits through bill C-17.

Canadians need reassurance. A country's economy grows out of its resources and Canada's most important resource is its population. Even though we make use of our human resources we are not making the most out of them, mainly because they are insecure. Our population feels insecure in areas like education, unemployment, health services, social housing, violence against women, the uncertainty of our future, legislation and governmental programs; it feels insecure about the leaders of this country. People worry when they see UI benefits shrink from year to year.

What will happen to this program in ten years? Will it be gone? Canadians are concerned when they hear about user fees in the health sector. Will they be able to get medical attention when they need it? Canadians are worried when they see that the budgets allocated to education and health care are being reduced all the time. They are concerned about the future. Will there still be work tomorrow, in spite of the promises made by some federal and provincial Liberal politicians?

Finally, Mr. Speaker, Canadians are worried because of their leaders' lack of concern for current problems. Let me give you two specific examples. Some 30 farmers in my riding incurred substantial losses in the production of potato chips. A request for financial help was made to the previous government. The request was rejected. Yet, some farmers from the Atlantic provinces who suffered similar losses were compensated. The farmers and their MPs made a request to the government in office. After two months, the government acknowledged receipt of their request, but took no concrete action.

Another group of individuals in my riding who are disillusioned with our leaders are those who were affected by the urea-formaldehyde foam insulation scandal. This tragedy occurred under the former Liberal government, of which some prominent members are still here. Let us not forget that the current Minister of Foreign Affairs was one of the key players in this episode.

Once again, I transmitted a request to the government in office asking it to take its responsibilities, instead of delegating them to the judicial process. The government acknowledged receipt of the request but did nothing else.

Throughout the debates in this House, we will have to keep in mind that all regions of Canada and all classes of citizens have to be treated equally. Is it right that, in Canada, 63,000 profitable companies do not pay taxes? Is it right that, in Canada, some millionaires manage to only pay a few hundred dollars in taxes every year? Is it right that, in Canada, powerful families can avoid paying taxes on billions of dollars through family trusts?

Middle-class workers know that the first penny they earn is taxed and that the government takes half of it.

In conclusion, if we want to balance our profits and expenditures, if we want to absorb our deficit, if we want our economy to resume its former role at the international level, if we want our wealth to be redistributed fairly, we have to restore confidence among Canadians. We have to meet their expectations and we have to answer their questions. We have to give back to Canadians the place that should always have been theirs: in other words, we have to realize that they are the number one resource in our economy.

[Ronald J. Duhamel, Liberal, Parliamentary Secretary to Minister of Public Works and Government Services]

Mr. Speaker, I would like to ask two questions. When we came into office, we were faced, and everybody agrees on that, with a deficit of about $45 billion and an accumulated debt of about $500 billion. My colleague said that there were a number of things he would have done, supposedly, if he had been in power to try to control the deficit and the debt.

He forgot to tell us how much he would have saved on each of his initiatives. Moreover, he said-and he will correct me if I am wrong-that he would have spent more. He said three things: Here is what I would have done, but without telling us how much he would have saved; here is what I would not have done, although some cuts have saved money and he did not say what would have replaced them. And finally, he said: Here is what I would have spent over and above what is already being spent.

If I am not mistaken, there was a deficit of $45 billion and a debt of $550 billion, and I believe he would make things worse. If I misunderstood, I am waiting to be corrected.

The second thing he mentioned that I object to are user fees. I never heard anyone on this side of the House mention such a thing. Why scare people? Why does he pretend that we are studying the matter? In fact, the Minister of Health has said repeatedly "no user fees", so why does he make such a comment? Does he not feel that it is unjust, cruel, maybe a bit dishonest?

[Michel Guimond, Bloc, Beauport—Montmorency—Orléans, QC]

Mr. Speaker, listening to the hon. member for St. Boniface, I am pleased to learn that we are allowed to accuse one another of making dishonest comments. I wonder if the hon. member heard the first part of my speech. I think he may have come in partway through. I will nonetheless answer his two belated questions.

First, what we blame the present Liberal government for is that in its February 22 budget it came up with nothing more than a national infrastructure program which will cost $2 billion in federal taxes, $2 billion in provincial taxes and $2 billion in municipal taxes, after running its campaign on a platform of jobs, jobs, jobs. This program will create 45,000 jobs per year, but just temporary ones. When Metropolitan Boulevard in Montreal and Saint-Jean Street in Quebec City have been upgraded, and the sidewalks redone, what other structural projects will there be to create permanent employment?

We, in the Bloc Quebecois, have suggested innovative job creation projects. A project like the high speed train would create 120,000 work-years of employment for the duration of the construction phase as well as 40,000 permanent jobs to operate the Quebec-Windsor corridor. It would also be possible to export Bombardier technology under North American licence for use in ten upcoming HST projects. Two hundred billion in investments over the next 12 years, that is what infrastructure programs, programs that create permanent jobs and high-tech jobs are about. That is my position with regard to the national debt and the deficit.

I will also remind the hon. member for St. Boniface that, had Quebec said yes in the 1980 referendum, the accumulated federal deficit was $75 billion at the time, compared to over $500 billion today. At this rate, what we are going to tell the people of Quebec next time around is that we can no longer afford to remain part of this country; we must get out because it is headed for a $600-billion or $700-billion deficit. That will be one of the arguments in the next referendum campaign.

As for deterrent fees, it is true that, since January 17, I have never heard the Minister of Health, or anyone else for that matter, say there would be any. I must admit that is true. Yet, with regard to the provinces' finances, the danger is that all of them end up facing cash flow difficulties and that the have-not provinces can no longer afford providing health care services because of cuts in federal transfer payments.

In Quebec, we are facing a real danger of finding ourselves back, like in the 1950s, with two types of medical practices: one for the rich and another one for the poor. With sickness striking without distinction of social status, race, language, and so on, there is a danger that the only way some Quebecers will be able to afford treatment will be to mortgage their home and belongings or to sell everything. That is the danger. It is true that the federal government never talked about imposing deterrent fees, but it does put the provinces in a situation where they could well experience cash flow and public finance problems that may divide people into two classes for health care.

[Dick Harris, Reform, Prince George—Bulkley Valley, BC]

Mr. Speaker, I listened to the comments of the hon. member of the Bloc. He talked about ways to create permanent jobs.

I have a question for him. He mentioned three particular projects: the TGV high speed rail line, the Quebec to Windsor corridor and the exporting of Bombardier technology to different parts of the world.

As I am sure most economists and the Bloc will acknowledge, real permanent jobs must come from the private sector. Although the current government disagrees with the Reform position on how to create real jobs and pushes ahead with credit card infrastructure programs to create temporary jobs, does the Bloc agree that the source of real permanent jobs is from the private sector? If so, is the hon. member talking about total private sector investment in the three particular megaprojects he has suggested? Or, is this another request for more government subsidies and more government money to be poured into the province of Quebec?

I find absolutely incredible that day after day we come to the House and hear the Bloc party talking about wanting to leave our country, wanting to separate. Yet day after day the Bloc sits in the House and continually asks for more money. Indeed this is a contrast in thought.

I want to ask the hon. member about these three projects. Is he simply looking for more government money to be poured into Quebec? I noticed this morning the Liberal government authorized some $575,000 going to the Montreal Symphony Orchestra and the Quebec Ballet going on a European tour. Earlier I talked about not having any food in the cupboard and buying a television set. This is just another case of money going into the province of Quebec that we just do not have.

Would the hon. member advise me whether he is talking about total private sector investment in the three projects, or is he simply looking for another handout?

[Michel Guimond, Bloc, Beauport—Montmorency—Orléans, QC]

Mr. Speaker, if the hon. member for the Reform Party sees a contradiction between statements by members of the Bloc and what we receive from the federal government, I want to make it clear that every year, Quebecers pay $28 billion in taxes to Ottawa. I hope that when the federal government invests in Quebec, no one here thinks the government is doing us a favour. It is our money, because we pay $28 billion in taxes.

As long as we are part of this system, and until such time as Quebecers say they really want to form a country, and in any event, Reform Party members who keep presenting petitions against official languages in Canada won't have a problem any more with what happens in Quebec. Quebec will be a French nation. You won't have to present any more petitions to complain about federal investment in Quebec, because Quebec will manage its own taxes, both federal taxes and provincial taxes.

So there is no contradiction involved in claiming our due while we are part of this system. The federal government is not doing us a favour.

Regarding investments in a high-speed train service, a task force including representatives from the Government of Ontario and the Government of Quebec and chaired by the hon. Rémi Bujold, former M.P. for Bonaventure-Îles-de-la-Madeleine, has shown that a Quebec-Windsor high-speed train could be 70 per cent financed by the private sector, while the government could inject 30 per cent, which would represent investments totalling about $2.3 billion. The revenue generated by 120,000 person-years of work during construction and 40,000 person-years when a high-speed train is in operation would total $1.8 billion, which means that the difference between $2.3 billion and what the federal government would contribute with $1.8 billion in tax revenues would be $500 million.

We voted in favour of a project worth several billion dollars to build a fixed link between Prince Edward Island and New Brunswick, because we felt it was a good project. We are convinced that if this proposal is debated in this House, a project that would create jobs, export technology, and nevertheless have a limited impact on the public purse, with 70 per cent participation by the private sector, it would be a very attractive proposition for Canada and Quebec.

[Dennis Mills, Liberal, Parliamentary Secretary to Minister of Industry]

Mr. Speaker, I would like to begin my remarks by-

[The Deputy Speaker]

I apologize for interrupting the hon. member but, before I give him the floor, it is my duty, pursuant to Standing Order 38, to inform the House that the question to be raised tonight at the time of the adjournment is as follows: the hon. member for Laurier-Sainte-Marie-Average income of Francophones.

My apologies to the hon. member for Broadview-Greenwood. Resuming debate.

[Dennis Mills, Liberal, Broadview—Greenwood, ON]

Mr. Speaker, I would like to begin my remarks by continuing on the theme that the member for the Reform Party discussed. It had to do with the contradiction of the Bloc Quebecois coming into the House and constantly talking about separation, yet at the same time asking for more support for megaprojects.

I have absolutely no problem with the members from Quebec fighting for their constituents, for their community and for projects that will help revitalize the city of Montreal and the province of Quebec. If we can get the economies of Montreal and Toronto going again it will go a long way in affecting all parts of the country.

What bothers me is the fact that the members from the Bloc never talk about the announcement that the Minister of Finance made on January 21 when he stated the terms of the five year equalization renewal, the equalization entitlement. As you know, Mr. Speaker, because of our Constitution we have an equalization formula. It is a complex formula where the provinces of British Columbia, Alberta and Ontario, which are the wealthier provinces, are contributing to those provinces in our Confederation that do not have the same resources.

On January 21 the Minister of Finance announced a $70 billion package for the province of Quebec. Over the next five years there will be a transfer of funds that will go to the province of Quebec, unfettered, no strings attached. I have yet to hear a member of the Bloc acknowledge that the $70 billion transfer under the equalization entitlement to the people of Quebec is a good thing. They seem to pretend it is not happening, that it does not go on.

I am not begrudging this transfer in any way. It is part of our contract to keep Confederation together. But when they stand in the House and talk about some of the difficulties we are having collectively in trying to get our economy going again, I wish in fairness that they would acknowledge the fact that for the last five years on equalization the province of Quebec received $50.2 billion and for the next five years it will receive an additional $70 billion.

The people in my community in Toronto cannot figure out transferring $130 billion to a community that is talking about separation. I am waiting for the day when the Bloc members start speaking publicly about the equalization entitlements and

the amounts that the people of Quebec will be receiving over the next five years.

They should not confuse their constituents by saying, as the member of the Bloc stated earlier, that they pay so much in income taxes to the federal treasury. I think the member said $28 billion or something and that they should have all of that back. They get all of that back and more under equalization.

Therefore, do not link the income tax being paid to the equalization entitlement. They are two separate issues. The equalization transfer is over and above all the other programs, services and fundings that are transferred to the province of Quebec.

I want to say, as someone from downtown Toronto, that to spend $100 billion over the next five years to keep Quebec feeling that it is part of Confederation, I personally would have absolutely no problem.

It was a very rough week for us in Toronto. We thought we were going to receive the centre for NAFTA for the environmental studies. We did not receive it but that is the game. You win some and you lose some. I guess my point is that I wish the members of the Bloc would show some of appreciation, not just to their constituents but to the people of Canada.

I realize that is just a little bit off topic from the budget amendment that we are discussing today but I thought it was relevant to the debate.

The part of the bill I would like to speak specifically to has to do with part IV, the borrowing authority of C-17. This is the section in the bill where-and I can see my friends in the Reform Party getting twitchy already-through the approval of the Minister of Finance, we are authorizing the Canadian Broadcasting Corporation, Radio-Canada, to a further borrowing power of $25 million.

I know that the members of the Reform Party have great difficulty with how we, when we are in such difficult times, could authorize for the CBC a further indebtedness or a further support of $25 million. I want to say to members on the other side that this is the right thing to do.

[Dick Harris, Reform, Prince George—Bulkley Valley, BC]

Say that with a straight face.

[Dennis Mills, Liberal, Broadview—Greenwood, ON]

I do say it with a straight face. As I was saying to one of our colleagues this morning, the CBC is really not like any other business in the country.

I do not know why I am defending the CBC because it has never been particularly good to me or for that matter to any other politician. It is one of those rare situations where we are defending an organization that is constantly attacking us. That is what makes this country so interesting.

Mr. Speaker, you signalled that I have only a couple of minutes. As we head into this very sensitive period where once again we will all be required to make sure that in the interest of national unity we bring our best foot forward, I really feel that it is important that the Canadian Broadcasting Corporation, Radio-Canada-radio, television, Newsworld-have a solid footing and a solid organization. This is an institution, as I am sure most people in Canada would agree, that is probably the best binding agent we have in a communications instrument.

We hear from musicians in every region who might otherwise not get the opportunity to be heard on a national basis. As I mentioned earlier today in debate it is a high quality organization for communication and production. It is also a tremendous training ground.

This is one area where, when we analyse the balance sheet of the CBC, we have not given it proper credit. This has been an area where it has trained people who ultimately have gone on to produce on other TV networks and in the motion picture industry. They are high quality technicians. Many of them now are creating product that we are exporting around the world. It is giving us not only a presence in North America but a Canadian presence all over the world. For that reason I would urge all members to support this bill.

[Jan Brown, Reform, Calgary Southeast, AB]

Mr. Speaker, I really appreciated hearing the comments of the hon. member across the floor, especially when he talks about the have provinces of Canada and telling everyone here today that Alberta is one of those.

It is wonderful to come from a have province. But we are going through one of the most painful periods in our history right now as we have a deficit reduction program that affects every man, woman and child in Alberta.

I am very concerned about the fact that feel good money is going to a province such as Quebec. There is no vision within that province that includes all of Canada. It is very well defined within their own borders for them.

It was interesting for the hon. member to have drawn an analogy between this feel good money that will be going to Quebec at all costs just to keep them and embrace them. I would love it if they could make the choice for themselves to stay in this wonderful country of ours.

I am totally opposed to that $25 million support for the CBC. I would like the hon. member to explain to me how he can in all good faith support the spending authority when there is basically no plan attached to it. It is just a carte blanche gift of spending. I really would like him to comment on that.

[Dennis Mills, Liberal, Broadview—Greenwood, ON]

Mr. Speaker, I would like to begin my remarks by saying to the member that in no way do I consider the equalization money being transferred as feel good money.

I do not believe that the Bloc Quebecois are the only people who speak for the province of Quebec. We have a provincial Liberal government right now in Quebec. The money, I believe and hope, goes into responsible publicly accounted for projects, such as retraining, education, et cetera. Please, let us not call this money feel good.

I want to say to the hon. member who comes from the province of Alberta that I realize her province is going through deep pain. So is my city and my province. However having said all of that, Quebec and some of our Atlantic provinces are even much worse off than the member's province and my province. That is something we have to realize.

As far as the $25 million for the CBC goes, and I do not think it is receiving this money and just going out and buying frivolous things, this money goes through a very rigorous process and goes into Canadian content and new production. The hon. member talked this morning about the CBC getting more revenue.

One of the reasons why the CBC is short on revenue is that it is competing with the CTVs of the world that have much more American content. The content in terms of Canadian budget and Canadian productions is not anywhere near the budgets of programming on other networks, CTV, which basically rents its finished product from abroad. The money will be going to enhance the production of CBC programming which hopefully will raise its quality and which will ultimately make it as productive as other networks.

I think the member has to realize and have the good faith that the new administration of the CBC, not putting down the previous one, has assured the CRTC and members of this House that, as all of us in this country are undergoing restructuring and renewal, it does not feel that it is exempt. It is going to do its best to make sure that this money is used efficiently.

[Paul Zed, Liberal, Fundy Royal, NB]

Mr. Speaker, through the course of today's debate much has been said about specific elements of this budget. I would like to take a few moments to put our discussion into context by reminding hon. members that the broad direction of the budget is one that has been described by the president of the Canadian Chamber of Commerce as headed in the right direction and very specific about how to get there.

This budget addresses three vital challenges. The first is to build a framework for economic renewal. The second is to restore fiscal responsibility and the third, to ensure long term viability of our social programs.

The budget takes a balanced approach to these goals because they are the foundations for what Canada needs most, growth and jobs. This budget is the first stage in a two stage process. The direct actions taken today will be followed by extensive policy reviews leading to further action in the future.

The government has taken concrete action to meet the urgent need of creating jobs and revitalizing our economy. Canada as we all know has just passed through a difficult recession. That is why we are taking immediate action to restore consumer confidence and spur growth, action such as our national infrastructure program.

Currently in New Brunswick as in other provinces we are determining the first projects to receive funding from the $153 million to be spent in our province over the next three years. This government has also announced strategic measures to help Canada compete and prosper in the new economy. This budget, for example, takes action to assist small and medium sized businesses, the driving force behind job creation in our fast evolving economy. Measures including reduction of regulatory and payroll tax burdens as well as improved access to capital and new technology are essential for continued growth and job creation in the new economy.

In keeping with the vision of this budget the standing committee on industry has begun a study on the access by small and medium sized business to new and traditional sources of financing. In the past weeks this committee in keeping with the government's pledge to consult with Canadians has heard testimony from small and medium sized business owners from across the country.

I am pleased to note that a number of Atlantic Canadian business people have come forward to give excellent testimony on this very important subject. Small business people know how hard it is to get a modest loan and this committee wants to see how the government can help.

The budget takes decisive action to bring the deficit down now and set the country on a realistic path toward a responsible target of 3 per cent of the GDP in three years, a target that no Canadian government has reached for 20 years. We will accomplish this mainly from expenditure reductions. In this area this government is leading by example.

Bill C-17, for example, freezes the salaries of members of Parliament. Over the next three years net savings from all spending cuts will reach $17 billion. This represents the most extensive program of net spending reduction of any budget in more than a decade.

We still have work to do. Even with last week's encouraging news of the largest monthly decline in the unemployment rate in 10 years, we still have too many Canadians out of work. We have an economy where one in six children lives in poverty and where social programs that were once the envy of the world no longer

meet our different needs and have outrun our ability to pay for them.

This budget sets the stage for a historic modernization and restructuring of Canada's social safety net over the next two years. The goal of this reform is to provide modern and sustainable programs that respond to contemporary needs like skills training and incentives to work.

The budget takes a critical first step toward this broad goal by initiating concrete action in two major expenditure areas: unemployment insurance and federal transfer payments to provinces in support of social programs.

Rising unemployment insurance premiums for business are a major obstacle to job creation. The changes to UI announced in the budget will lower premiums and provide the creation of more jobs. As the president of the Canadian Federation of Independent Business said: "It is a huge incentive for small business to create business".

In the recent past federal action toward the provinces appeared to be based on a strategy of sneak attacks, confrontation and denunciation. This led to federal-provincial relations increasingly charged with tension. This budget rejects this approach. Instead it provides for predictability and modest growth in equalization transfers during the timeframe for social program reform.

Throughout the course of the reform process the federal government will work with all of the provinces to redesign our social programs. We will co-operate in studying reforms and testing new approaches with extensive consultations with the public to receive their input along the way.

In the province of New Brunswick we recently announced co-operation agreements between the federal and provincial ministers to find new ways for making a better Canada: a youth jobs strategy program at CFB Gagetown to allow young people between the ages of 17 and 24 to receive skills training in different trades; the New Brunswick job corps program which provides a guaranteed income for participants in return for volunteer services. This program is targeted at individuals over the age of 50.

As the finance minister for Newfoundland said recently, all of us and every province in this country have to be part of the solution to the Canadian problem.

The spirit of federal-provincial co-operation I have described extends beyond the budget measures relating to social security transfers. Despite the co-operative and constructive approach this budget takes toward the provinces, some hon. members have expressed concern about the regional impact of specific measures. As a member of Parliament from Atlantic Canada, I believe I can bring an important and constructive perspective to this critical issue. I say this because we in Atlantic Canada realize the scope of the national problem and we know that to correct it, tough decisions have to be made.

We know we must look forward to the new opportunities provided for in this budget, opportunities like the infrastructure program and our experimental job corps, opportunities that get business working in the proper climate to create the jobs and economic security we need for the 21st century.

We in Atlantic Canada recognize the importance of taking control of our own destiny. We are spearheading the move to lower interprovincial trade barriers and have truly free trade Canada within Canada.

In concluding, I would say that this budget has been described as a road map to the future. It takes measurable, bottom line action to help build the future opportunity and solid growth. It does so with rigour but also with compassion and creativity. Therefore I urge all hon. members to support this bill.

[Dick Harris, Reform, Prince George—Bulkley Valley, BC]

Mr. Speaker, I was disappointed I did not get to make some comments to the hon. member across the way. I know he was looking forward to that.

I just heard the hon. member for Fundy-Royal talking about the merits of the budget. There were a couple of things that sort of struck me which I have discussed with other members in these debates.

First of all I would like to say the statement made by the president of the Canadian Chamber of Commerce, as the member pointed out, rang about the same bell as that of the chairman of one of the major banks during the referendum debate when he said that in essence the world is going to end if the Charlottetown accord did not pass. Of course we saw that did not come about exactly.

The member is saying that this gentleman has said that the Liberal budget is on the right track. I wonder just exactly where that track leads to. There are a couple of inconsistencies. The member talks about all the different job creation programs that the budget is going to bring about. I wonder if the answer to the unemployment problem in Canada to the Liberal government is simply to put everyone who is unemployed on a government program.

I am sure those people would rather have real jobs. I go back to my earlier comments about where real jobs come from. They come from the private sector industry that has confidence in the fiscal responsibility of the government.

That is what this government has to show and it has to show it by cutting spending in real and positive terms. This has not happened.

The actual spending has increased by $3 billion this year. The member said they had made significant cuts in spending. That may be quite true but this is in proposed spending and projected spending not in real spending.

I can say I am going to spend $50,000 next week on something and then cut it back to $2,000. Can I take credit for saving $48,000? This is the same type of accounting that the previous administration used and the Liberal government before that.

We have to start talking in real terms about what it is going to take to get this economy going again. It is not going to be credit card infrastructure programs. It is not going to be job creation programs for which there are no jobs once the people graduate from those programs or attain their apprenticeships.

It is going to come from private sector confidence and private investor confidence when they start investing in this country and expanding their business. That is where it is going to come from.

[Paul Zed, Liberal, Fundy Royal, NB]

Mr. Speaker, I appreciate the hon. member's comments. In fact in as many days as I have spoken in this House the Reform Party has raised the issue of the infrastructure program. I would remind the hon. member that it is the infrastructure program that is in fact giving Canadians confidence. It is the package, if you will. That infrastructure program is what is spurring the confidence.

I agree with the hon. member that small and medium sized businesses create 80 per cent of the new jobs that are created in this economy. But if the government does nothing but cut without stimulating I would suggest to the hon. member that we are going to be mired in a deeper recession than the one we are getting out of.

It is a balance. That is what has impressed me the most about this Minister of Finance and about our government, that there has been a balanced realistic approach. The cuts represent $17 billion.

I am one member who would have liked deeper cuts, faster cuts, but I have been convinced that this is a balanced approach and over the next three years we will be within 3 per cent of the GDP which I believe is responsible.

I would urge the hon. member, if he has some suggestion about what is wrong with our infrastructure program, to let us hear it. However I know a lot of people and a lot of municipalities are enjoying the benefits of the infrastructure program.

[Gilbert Fillion, Bloc, Chicoutimi, QC]

Mr. Speaker, I would simply like to make a comment about the programs which my colleague mentioned and that are presently considered in his province of New Brunswick.

I do not know if the hon. member has read La Presse this morning, because one headline says: New Brunswick wants to force single mothers to identify the father of their child'', and I have followed the experiments that are being done in this field,Those who will refuse will lose access to welfare''. Is that the kind of model we want to give Canada?

[Paul Zed, Liberal, Fundy Royal, NB]

Mr. Speaker, that is not the program I am referring to. The one I am referring to is an opportunity for young people to be trained in a specific area: perhaps an environmental project, a silviculture program as the lifeblood of New Brunswick is the wood industry, or some community based program. A program was recently announced for people over 50 years of age who would only be making about $8,000 on welfare. In this pilot program 1,000 individuals will be eligible to receive $12,000.

[Ian McClelland, Reform, Edmonton Southwest, AB]

Mr. Speaker, my comments in these short 10 minutes were to be on the omnibus bill, a bit about UI reform and, if there were time, on the wage freeze. However the eloquent, noble and spirited defence of members opposite of the mother corporation CBC drove me to buy a newspaper to find out what the oracle of Canadian culture had in store for us tonight.

For the edification of members opposite and for those in television land, they can want see "All in the Family" at seven o'clock, "Blossom" at 7.30, "Fresh Prince of Bel-Air" at eight o'clock or at 8.30 "Fresh Prince of Bel-Air, Part II". Is the oracle of Canadian culture worthy of the money we are going to be borrowing from our children to pay for it? Does it need more money? Should we give it $25 million so that it can get capital?

Let me deal, folks, with the Canada assistance plan because it is fairly serious.

[An hon. member]

That is the Canada assistance plan.

[Ian McClelland, Reform, Edmonton Southwest, AB]

Yes, it is.

[The Deputy Speaker]

First, it would be very much appreciated if the member would put his remarks to the Chair. It is a long established tradition. Second, the member actually has a 20-minute slot.

[Ian McClelland, Reform, Edmonton Southwest, AB]

I could go on at more length about the mother corporation in that case.

In any event, this omnibus bill in support of the budget is of great importance to our nation. As other members have said, it sets the stage for what is likely to happen over the next few years.

Under the Canada assistance plan, as members know, the Government of Canada was to fund generally speaking 50 per cent of the money the provinces must spend in the welfare programs they administered. A few years ago this was changed. The Canada assistance plan payments by the federal government to the three provinces of Ontario, British Columbia and Alberta were capped. The net result was that these provinces were

frozen into a situation whereby they were getting less money transferred from the federal government but were really having more demands put on their resources.

The real problem is that we as a nation will go through the trials and tribulations of living within our means. This will inevitably mean cutbacks. Unless these cutbacks are done fairly across the nation and in all sectors of our economy tremendous resentment will be built up.

Let me give an example of what is likely to happen or what is happening with the capping of transfer payments. Maclean's magazine of April 4 speaks to the problems Ontario is going to face because of the Canada assistance plan being capped: ``Through the Canada assistance plan Ottawa paid 50 per cent of the welfare costs of the seven poorer provinces but picked up only 29 per cent of Ontario's 1993-94 tab of $6.3 billion. Quebec got 10 per cent more funds with 43 per cent fewer beneficiaries''.

Let us think about that. If a Canadian is on welfare or in need of funds from the government and lives in Ottawa or anywhere else in Ontario, the federal government pays 29 cents of every dollar of those costs. However, if he or she lives across the river in Hull five minutes from here, the federal government pays 50 per cent of the cost. Is that fair? That might have been fair because of an extenuating circumstance that might last for a year or two, but let us remember that the budget locked in the inequity until 1998. What strains will that put on the budgets of Ontario, British Columbia and Alberta?

There is a solution. The federal government could increase the payments to the three have provinces or it could reduce the payments to the three have not provinces to bring them all into line so there is balance and equity.

A further example from Maclean's magazine indicated: ``In 1992 Ontario employers and employees paid $1.67 billion more into the unemployment insurance fund than they drew out in benefits. The province blames UI rules that allow workers in areas of higher unemployment to work for shorter periods for longer benefits''.

Several members mentioned earlier that this was an appropriate means of transferring funds into very depressed areas of the country, that it recognized some parts of our nation were in worse shape than others. Unemployment insurance should be unemployment insurance. When unemployment insurance was brought into being it was not determined at that time that it was to be a wealth transfer. It was to cushion employees who lost their jobs for one reason or another until they found another one.

From that aspect the budget goes a long way in eliminating or at least ameliorating the problem. The government is to be commended for recognizing that unemployment insurance continually taxes those who are working. It really is a tax on jobs and is going to do more harm than good in the long run.

As well, if the words we hear from the task force looking at unemployment insurance are true, that unemployment insurance may in the future be determined as an insurance program paid by employees, it will be another big step to reforming unemployment insurance. It is just blowing the dust off the Forget commission report and implementing it 15 years or so after it was written.

What do we do in the areas of Canada that need the transfer of UI funds so that people can exist? We need to look at it as two separate entities. Unemployment insurance should be unemployment insurance, the purpose for which it was intended. Income supplements should come through some other government function but be accountable. If it ends up being a guaranteed annual income or whatever it might be, so be it, but let us not confuse the two issues so that we end up with nothing.

I would like to give a personal example of how unemployment insurance as it is used today is a disincentive to employment and costs far more than it should. Without the permission of my son I will use him as an example. He is a very fine young man who quit his job just before he was going to get fired because he was not doing a very good job. It was a fairly well paid job. He thought he would not have any trouble going out and finding another one. It turned out that he was wrong. He had a great deal of trouble finding another one.

Every two weeks he got a cheque in the mail for over $600. When the time came for me to say to him "Marry, go out and get a job", he would go out looking but none of the jobs would pay anything like the amount of money he was getting for doing nothing. Unemployment insurance was not tiding him over until he could get a new job. Unemployment insurance at that level was robbing him of the initiative to go out and get a job.

He grew up in a home where industry and initiative were the bywords and the watchwords. Let us just imagine what the richness of the program has done all across the nation to hundreds of thousands of people who are milking the system, who are using the system as it was never intended to be used.

The steps the government is taking with regard to UI are in the right direction. However it must be coupled with some other program to ensure that people on the bottom end of the totem pole are able to exist and move themselves out of poverty, recurring poverty.

I would like to spend a few minutes talking about the wage freeze which is a good idea. It is a particularly good idea in the House because we are the leaders of our country. The people at the top of the heap in any circumstance, especially a difficult one, should be the first to take a hit. A wage freeze in the House is entirely appropriate. It is entirely appropriate in the upper echelons of the public service.

However we have to do more than just say we are going to freeze the wages. We have to look at how we could get the most efficiency out of the money we are spending. We can bet that people in any organization including the Public Service of Canada lay awake at night trying to figure out how they can get around whatever particular obstacles are in their path and make a few more bucks.

If we were to look at it we would see that the only people who are really suffering a wage freeze are the people who are on the bottom rung of the ladder in the public service because they cannot reclassify their jobs.

For example, right here on Parliament Hill employees of the lowest order of employment had to restructure their employment base, come in on weekends and change things around so that they could no longer make overtime because there was no more overtime. They cannot come in and work on a weekend and get paid overtime. Yet other people in the hierarchy here have reclassified their jobs so that they can then get an increase by reclassification.

Another example that was brought to my attention during the recess was in the weather stations across the nation. A person from the public service brought to my attention the fact that we have replaced weather recorders who used to be paid in the region of $30,000 with a machine that costs about $250,000.

These machines have a life of about five years and require one person to maintain them and travel around. Bonuses are paid in the public service for anyone who is able to reduce the person years of employment in their sphere of influence. What happens is that if one gets rid of five weather observers and replace them with a machine, one would get the bonus for reducing one's payroll. However, the expense of the five machines goes to one ledger and the expense of the maintenance person goes on another ledger. We still have to pay it but we are really no better off than we were when we started or perhaps a little further away from where we wanted to be.

It also does not do any good in terms of employment. What we have to do as a country is not just say we are going to have a wage freeze, but we have to go through our books line by line just as we would in the private sector and ask how we can make everything that we do more effective, more efficient and work better rather than just saying willy-nilly, we are going to put a freeze on this or we are going to put a freeze on that. While it sounds good, it really does not accomplish anything.

In conclusion, I would like to spend just a couple of minutes addressing the question of Quebec and the fact that this has come up for those who have been following this debate. Every time a member of the Bloc stands in this House, at least in my experience, it has been to cry how badly off the Bloc is treated financially by the rest of Canada and yet it is to request more money from the Government of Canada.

I hope that when this great national debate takes place in this House and in the rest of the country we talk honestly and openly and fairly about who gets what out of Confederation. Speaking for myself and for many of my colleagues here, speaking for the people I represent in Edmonton Southwest we do not mind because we recognize that we are better off than most paying money into Canada that is used as equalization going to other regions of Canada to help them along.

However, we really resent it when we are paying this money into an equalization pool and the people who are on the receiving end of it just ask for more and never say thanks. As this debate over the next few months unfolds, I hope we will talk honestly about whether we are together as a nation because we want to be together or because we are together as a nation only because we continually pull out the wallet and throw money at the problem. I can guarantee that if that is the only reason that we are together as a nation it will not last.

This budget in some aspects is a step in the right direction. Certainly to be fair it is better than anything the Conservative government came up with over many years. Let us not kid ourselves, it is merely the first tentative step. The very difficult and hard decisions are yet to come. They must come because not one person here, not one Canadian anywhere in this land has ever spent their way into prosperity.

The only way that we as a nation can make our futures better is if we live within our means. It is not morally right for our generation or the generation that preceded ours to live beyond our means at the expense of generations of Canadians yet unborn. We are going to have to bite the bullet, live within our means and make the tough decisions necessary.