I thank hon. gentlemen on the other side for observing the decorum accorded each speaker on such an important issue as the budget debate. I hope I did not lose any time.
We tackled the issues head on and made job creation, economic growth and fiscal responsibility our top priorities. The new budget is the latest step in our ongoing drive to restore Canada's fiscal health and reinforce investor confidence. When completed this drive will make Canada a magnet for investment, which will in turn encourage economic growth and create the jobs and training opportunities Canadians need to cope with the technological revolution under way.
The measures announced by the government on budget day were more than a cost cutting exercise. They represent a major restructuring that will redefine the way government operates and what role government will play in people's daily lives. The budget represents a basic restructuring of Canadian society as a whole.
As the Minister of Finance stated in his budget speech, government must only do what it does best and leave the rest for those who can do it better. This presents Canadians with an incredible opportunity to step forward and have a direct impact on the way their lives are shaped and the way their communities develop.
As we debate the merits of the budget today and the necessary actions the government must take to get its fiscal house in order, we must remember we are not in a unique position in Canada. Other countries have waited too long before taking adequate measures and have in a sense hit the wall, while others have taken strong and affirmative actions and as a result have positioned their economies to compete aggressively in the new global marketplace.
We can learn a lot from those examples. New Zealand is a case in point of a country that found itself with debt and deficit that became too large for its economy to sustain. Over the course of the past eight years New Zealand has gone through a dramatic and painful restructuring that saw whole government programs cut, eliminated or commercialized, user fees introduced for many aspects of government services, and the introduction of new tax measures such as the GST.
As a result of these measures New Zealand has drastically restructured its government and improved its fiscal health to the point where it posted a deficit of 1 per cent surplus of deficit to GDP ratio. However the painful lesson learned by New Zealanders and one we must not ignore is what happens when we wait too long to take these measures and what happens when we essentially hit the wall. When this happens countries quickly discover that decisions on social spending are no longer theirs to make but instead made for them by investors and international agencies.
Sweden, a country that has been long looked at as a successful model of society with a highly successful social safety net is on the verge of hitting the wall. In 1994 Sweden's debt to GDP ratio was an alarming 93 per cent while its deficit to GDP ratio was at 11.2 per cent. The year before, Sweden's deficit to GDP ratio was at an all-time high of 13 per cent.
The government there is facing enormous obstacles to overcome and put its fiscal house in order. Because Sweden has waited so long to restructure how its government operates, the very social programs that are the envy of the world are threatened simply because it has lost many of its options to manoeuvre.
This is a situation we must avoid in Canada. On the other hand, there are shining examples of countries that have identified the need to reform before it is too late.
Australia has taken a systematic and measured approach to restructuring how its government operates. It has been done in a way that not only brings down the expenses of government but also makes its programs more efficient, more effective and more relevant to the people who really need help and support. In 1994 Australia posted a 34.4 per cent debt to GDP ratio and a deficit to GDP ratio of 4 per cent.
That is why we have to act now. Our debt to GDP ratio has consistently been rising from 17 per cent in the mid-1970s to more than 71 per cent today. In order to ensure that we remain the masters of our own destiny, of our own ship, we must change. We must adapt.
Last year the government spent nearly $58 billion on social programs. During that same period $38 billion went to pay for interest on the public debt. If we do not get our fiscal house in order now, these interest payments on the debt will be greater than what we spend on social programs. If unchecked, we as other countries have, will hit the wall.
That is what this budget is all about. It is a major step in restructuring the government so that it can give us the kind of strong foundation we need upon which we can build strong social reforms which truly reflect and address the needs and priorities of Canadians in the 1990s.
Initiatives contained in the budget actually support Canada's social policies by creating an economic and fiscal climate conducive to job creation. This budget reflects the sense of balance expressed by a man from the Northwest Territories who responded to the social security reform workbook. He said: "There must be a basic safety net for those who, for whatever reason, are unable to provide the encouragement and the opportunity for people to become self-sufficient".
Some people have been concerned about how the budget might affect Canada's social programs. This is not surprising given the vast amount of speculation and misinformation which
surfaced prior to the release of the budget. No doubt most of this has now been laid to rest by the budget.
For those who might still have some lingering doubts, the best evidence of the government's unwaivering commitment to protecting our social programs comes from the social security reform initiative currently under way.
This initiative seeks to improve our current system by helping Canadians respond to technological and workplace change. It seeks to assure them of the jobs training and security they require. It does this by improving the efficiency of the system, thus guaranteeing its sustainability in the future.
At the same time, our government has no intention of waiting for the benefits that will flow from this budget and social security reform. Instead, we are acting now to ensure that all Canadians have the job and training opportunities they need to enter the mainstream of this country.
Here I think especially of those programs directed toward some of the neediest people in this country, the aboriginal people who have traditionally faced barriers to obtaining access to employment, training and promotions.
Pathways is a program designed for aboriginal people by aboriginal people in partnership with the Government of Canada. It is currently being reviewed to ensure it continues to reflect the needs of the aboriginal people in labour market training.
In addition, the new Canada social transfer, CST, will not affect aboriginal peoples living on reserves since there is no relationship between the CST and funding arrangements for social assistance and services delivered on reserves. This is because the Department of Indian Affairs and Northern Development provides funding on reserves through arrangements that are separate from the current Canada assistance plan. These arrangements will continue to be separate from the CST.
As well, the CST will not alter the existing responsibilities of the provinces for social assistance services to aboriginal peoples living off reserve. This goes for the government's program review as well.
While the program review will affect all aspects of government operations, the government is committed to providing programs and services to aboriginal peoples. We will continue to live up to our commitments in such areas as human resources development, aboriginal strategic initiatives, First Nations and northern communities child care and the pathways strategy which I mentioned earlier.
In preparing for the budget the government used a series of overarching principles to guide its course.
First, it was critical that government get its own house in order. The budget must focus on cutting spending, not raising taxes.
Second, every dollar counts. Governments do not have money. They are given money and with it they must act like every dollar counts because every dollar does count.
Third, it had to be fair and equitable, fair among our regions and fair among individual Canadians. In this essence the north has not been spared in the budget, but has shared equally and responsibly its burden of fiscal restraint.
As an example, the territorial formula financing payments to the Government of the Northwest Territories will be frozen in 1995-96 and reduced by 5 per cent in 1996-97. This will result in $8 million less in the first year and $58 million less in the second year. It should be noted that the majority of the population of the north is aboriginal.
Weather offices will close in Yellowknife and Inuvik, eliminating seven positions. There too, a bit of innovation and imagination is needed. It opens up an opportunity perhaps for the private sector to look at the possibility of offering this kind of service, maybe in partnership with learning institutions to train the individuals necessary to provide that service.
The Geological Survey of Canada office in Yellowknife will close. Considering the amount of activity in that area with diamond exploration, gold and a whole array of mineral exploration going on, it has been difficult to do that, but I think there is a commitment from the industry itself to pursue interests in that area. It is something we are living with.
The Canada-N.W.T. forestry co-operation agreement will not be renewed when it expires on March 31. The federal excise tax on gasoline and aviation gasoline increased by 1.5 cents, increasing the price of goods and travel in the north. We already have prohibitive costs since for the most part the first choice and option for travel is by air. We do not have a highway system. Most of the isolated communities are off the transportation grid.
The tax on airline travel increased by $5 per flight from $50 to $55, increasing the cost of air travel which is so important to northerners. We do not have the luxury of just getting into our cars or vehicles and driving out onto the highway. The highways we do have are in need of repair and are being repaired constantly by the Government of the Northwest Territories with ever depleting resources.
It shows, that every part of the country was affected, including that part of the country. It is the whole effort of getting back
to basics. People are taking another look at how they do business, how government runs its administration, its bureaucracy and delivers services.
The elimination of the public utilities income tax transfer is not just a problem for Alberta or some of the other provinces. It is a problem for different communities in my area. It will mean the elimination of $700,000 in transfers to consumers of private utility companies.
This is a very hard pill to swallow. In this country we have a partnership with individual Canadians to get our house in order and this is what this is all about.
As difficult and painful as it is, cuts in budgets and programs to aboriginal friendship centres will affect how the friendship centres in the north operate and deliver their programs. However, northerners are resilient people. Like every Canadian, they recognize the importance of getting our fiscal house in order.
Northerners also see opportunity in this budget. Occasions like this one when new arrangements are to be forged and new relationships to be established create positive opportunities for the territorial government to have greater flexibility and for northerners to have a greater say in developing and administering the programs and services which address their needs.
This is an excellent opportunity to see the successful completion of the northern mineral accord. This can give the territorial government along with its other partners the aboriginal groups greater responsibility and autonomy over the economy and fiscal situation in the north. Greater autonomy also means greater flexibility over the programs and services required to meet the needs of northerners.
Every part of this country wants to become self-sustaining and the Northwest Territories is no different with all of its complex diversity of cultures. Its population is not just one race or one group of people, but it is a whole mix of people. Greater autonomy also means there is greater opportunity for co-operation, for consensus building and a whole range of human dynamics that must be considered.
Restructuring through program review, the territorial transfer or the CST also presents the opportunity for constructive dialogue in a process that is inclusive. It is a process which gives a greater voice to all stakeholders and not just government, including community leaders, activists, social workers, youth organizations. It is a comprehensive and inclusive process. It is an opportunity that can lead to greater independence from government, to become increasingly self-sufficient and self-empowering, to become masters of their own destiny and masters of their own ship.
The fourth principle used by the Minister of Finance is that we must have priorities as a country that mirror our needs as a people. These priorities must be reflected in the way government defines its role. It is that principle I would like to expand on and what this will mean on how government will operate in the future, but more important, on what role government will play in the lives of people.
In order to ensure that the needs of Canadians are met, to ensure that programs and services remain relevant and to ensure our continuing economic sovereignty, the budget measures also included a major restructuring of government through program review. Its main objective was to review all categories of federal government spending in order to bring about the most effective and cost efficient way of delivering programs and services to Canadians.
The exercise of program review is not simply a way of bringing down how much government costs. It also makes government more competent and more relevant to the people who really need help and support.
It is time for government to get back to the basics and to reflect the priorities of people. As the Minister of Finance stated in his budget address: "We are acting on the new vision of the role of government in the economy and in society. In many cases that means smaller government. In all cases, it means smarter government".
This government restructuring will have implications on what role government will play in the daily lives of people. To a certain degree government restructuring also means a restructuring of society, and that is where the real opportunity lies in the budget. As government gets back to the basics there are opportunities for Canadians to step forward, to rethink and redefine their values and responsibilities to themselves, their families and their communities.
Governments do not have all the answers and solutions. In redefining its role in Canadian society, the government will need people to step forward and share the burden of responsibility. Where governments have failed in the past, individual Canadians will have to stand up, play positive roles and contribute not only their knowledge but local solutions to local problems and also their sweat equity, their sweat, blood, and tears, to ensure success.
The government is calling on Canadians to participate and to be part of a process that is going to set the future straight for years and generations to come, to ensure a future for our children. This commitment will need to be ongoing even with restructuring; government can only go so far.
I conclude by saying that in the end active participation is the ultimate challenge of the budget. It is a challenge and a
responsibility not only to members of the government and members of the House, but to every person in the country.
As the Prime Minister stated, the key-