Mr. Speaker, it is my pleasure to join the take note budget debate and offer my views to the Minister of Finance.
When talking about the budget the first issue we have to deal with is the debt and the deficit. We have to come to some sort of understanding on how big a problem it is. Once we come to grips with how big a problem it is, then we can say how much cost we are willing to bear to get it under control.
My own view is to move aggressively as reasonably possible to a budget surplus. I use the word surplus as opposed to a balanced budget. A balanced budget does not solve the problem of too much debt. A surplus would allow for the lowering of that debt. In the lowering of that debt there would be a number of factors that would compound positively for the Canadian economy.
There would be a lessening of interest rates as money lenders would see less of a risk in lending money to Canadians. They would lower the cost of the money that they lend. There would be less of a currency risk which would again compound to lower interest rates. Consumer confidence would go up; investor confidence would go up.
All of those factors would provide some possibility of tax relief which again would be good news for the economy. All of those factors combined would increase economic growth, increase jobs, increase opportunity and would be good for the Canadian economy overall.
However, the goal to eliminate the deficit must not be our sole purpose. We must acknowledge the linkages within the economy. To simply slash government spending would from a macroeconomic point of view lessen aggregate demand and risk putting the economy into recession.
Furthermore, we need to acknowledge there are pressing needs within Canadian society. The issue then becomes: Can the government maintain or even improve social spending or social programs while reducing overall spending? The answer is yes it can by making adjustments or deeper cuts in other areas. By establishing priorities we can consider new initiatives to meet urgent needs.
Let me bring the attention of the House to what I believe should be this country's number one social priority for the upcoming budget, the issue of child poverty. There has been a steady and alarming increase in child poverty in Canada over the last decade and a half. According to the Canadian Institute of Child Health the poverty rate for children rose 60 per cent between 1981 and 1991. The most recent Statistics Canada figures indicate that 1.4 million children in Canada under the age of 18 now live in poor homes. Poverty among single mothers remains stable and tragically high at 56 per cent.
According to the United Nations Children's Fund, among the OECD nations Canada has one of the worst records on child poverty, second only to the United States. Given the UN has also rated Canada as the top country in the world in overall quality of life, our failure to deal with child poverty is all the more glaring. To those who might insist we cannot afford it at this time, we have to ask why our OECD partners faced with similar fiscal challenges have been able to do a better job for their nation's children. I believe it is a matter of setting priorities.
I would also like to point out that in solving the child poverty problem we also address a number of other problems. We would improve the country's productivity. We would spend less money related to crime and crime prevention. We would lower our health care costs. All of these factors combine to make a better country.
The solution in part can be found through an income supplement program. I am recommending to the Minister of Finance that he put in his budget a $500 million program called the working income supplement. I will not bore this House with the details of the proposal but would point out that it was described most adequately in a supplement to the green paper in a paper called "Income Security for Children".
One might ask: "If this fellow believes in cutting the debt and cutting the deficit but he wants to invoke a new social program, where does he think we are going to get the money from?" I would like to talk for a moment about the defence budget because I think the defence budget needs to be cut, it needs to be cut not only to free up money for debt and deficit reduction but also for social programs such as child poverty.
Canada's current military budget is approximately $11.4 billion. Peacekeeping accounts for only 5.5 per cent of this budget. Canada currently has the 12th largest military spending in the world. We are the sixth largest spender among NATO's 16 members. Military spending has been declining significantly around the world for several years. However, Canadian military spending has been an exception to this pattern.
By 1994 world military spending was 29.6 per cent lower in real dollars than it was in 1985. Military spending by countries that are not members of NATO was a whole 42.5 per cent lower. However, Canadian military spending remained 3 per cent higher in real dollar terms than it was in 1985. As a result Canadian military spending rose by 46.2 per cent relative to world military spending. I ask my colleagues to check the facts which I believe they will find accurate.
The pattern is even more striking if we look back to 1980. Although it grew substantially during the early part of the 1980s, by 1994 world military spending was 16.5 per cent lower in real dollars than it was in 1980. However, Canadian military spending was 36.2 per cent higher. As a result Canadian military spending rose by 63 per cent relative to world military spending.
The Canadian government has begun to make real cuts in military spending since 1994. I acknowledge those cuts and I applaud them. The reductions, begun in 1994, are expected to total about 19 per cent-