Mr. Speaker, I will share my time with my Bloc colleague, the hon. member for Matapédia-Matane.
The Minister of Finance tabled his budget on Monday, February 27. I rise today in this House to state my position, my concerns and my disappointment in reading this budget. I will also share with you my personal analysis of the negative impact this budget will have on the participation rate of Quebecers in the Department of National Defence. While this budget is well received by the business community in general, and foreign investors in particular, the fact remains that once again low and middle income taxpayers are the hardest hit.
The government wants us to believe that Canadians from every walk of life, including the wealthiest, are affected by its budget cuts, but there is a world of difference between the finance minister's claims and actual fact. The fact of the matter is that the wealthy have until 1999 to convert their family trusts, to shield them from the minister's cuts and not pay any tax on their accumulated and future wealth. Also, the Liberal budget completely ignores the recommendations made by the Auditor General of Canada in his last report which made reference to $6.6 billion in unpaid taxes. The federal government does not propose anything to recover that money.
How can the government pass up so much money without immediately taking the necessary measures? Is $6.6 billion not enough money to spur it to take concrete and effective action?
Let me give you another example which illustrates the inconsistency of the budget and fiscal strategy announced at the end of February by the minister, and which shows that the minister's goal of tax fairness is merely an illusion. This example is also taken from the Auditor General's report: In Revenue Canada's opinion, 470 accounts of over $100,000 each, representing a total of $350 million, were at the collection letter stage, which means that no collection officer was involved, except in terms of reviewing the risk of loss.
By not taking action in this specific case, the Liberal government is sending the message that it is easier to get the money from low and middle income taxpayers, than from corporations or wealthy individuals who do not pay their fair share. This system is supposed to be fair, but who profits from it?
In my opinion, the 1995-1996 budget plan includes other examples of unfairness. Take a look at the summary of the Main Estimates, by department and agencies. Two thirds of the departments and agencies will see their budget reduced, while the other third will be getting more money.
Who will get an increase in 1995-96? The Senate, with a total budget of more than $42 million; the Governor General, with a budget of over $10 million; the Department of Indian Affairs, with an increase of $327 million; Treasury Board, an increase of $32 million; Finance, an increase of more than $9 billion, $9 billion to service the debt; the Privy Council, which is responsible for defending the "no" side in the Quebec referendum, will have an increase of nearly $5 million; and the list goes on.
And even worse, the federal government's total estimates will increase by more than $3.7 billion, which will bring total spending up to $164.8 billion. Incredible. With a deficit of $37.4 billion for 1994-95 and a projected deficit of more than $32.7 billion for 1995-96, we are sinking deeper and deeper into the hole.
By the end of the current fiscal year, the net federal debt will be $578.8 billion. Incredible. The federal government's present financial situation is a reflection of what the future has in store. Furthermore, the budget brought down by the Minister of Finance contains no prospects for jobs in the short and medium term. Where are the jobs we were promised in the Liberal red book? Ask the federal public servants who believed those promises.
The steps taken by the federal government to put this budget together fall far short of the expectations of taxpayers in Quebec and Canada. These measures are an outright breach of our social contract.
Now for a few words about the Department of National Defence. The budget announced cuts totalling $1.6 billion over three years. The Bloc Quebecois, in the minority report of the Special Joint Committee on Canada's Defence Policy, insisted
on additional cuts of 15 per cent, which would put the National Defence budget at $10 billion as of the first year.
I question the federal government's strategy, since additional cuts could have been made in certain budget items in the Department of National Defence, including capital expenditures, materiel and new equipment purchasing policy, the armed forces organization and, finally, program management.
For the same three year period, the Bloc Quebecois proposed cuts of $4.8 billion-three times the government's figure. Unfortunately, the federal government preferred to slash transfer payments to the provinces and cut the federal public service this year.
In this regard, I would like to recall the commitment the Liberal Party of Canada made in its famous red book, which it did not keep. It said that, once in power, it would set up a defence conversion program that would have attractive spinoffs for private enterprise. This was their promise.
What did the budget say about defence industry conversion? Not one word-nothing. For the past 15 years, the federal government and the Department of National Defence have failed in their role of equitable allocators of military expenditures for Quebec.
In a study for the École nationale d'administration publique, made public in February, the author revealed a shortfall of $650 million a year for Quebec.
The situation is very clear. Unfair treatment in the allocation of military expenditures has had disastrous consequences for a number of areas of economic activity in Quebec. Although Quebec contributes 25.4 per cent of the budget for national defence, it gets back a meagre 17 per cent in military spending. It has been the same old story for the last 15 years. This very unfavourable distribution continues to cost Quebec jobs and investment dollars.
Quebec is even worse off when it comes to the funds that the Department of National Defence allocates for research and development.
In 1990-91, Quebec received only 12.45 per cent of this spending-12.45 compared with the 73 per cent that went to Ontario. The situation has not changed since then. In addition, francophones have great difficulty rising through the ranks of the Canadian armed forces. While francophones occupy between 22 and 29 per cent of the lower-ranking positions, they occupy only 10 to 13 per cent of the higher ranks, according to the latest statistics. It is not difficult for francophones to enlist in the forces, but it is very difficult for them to become generals. It always has been and still is.
In 1994, the Minister of National Defence took away the country's only French-language military college, the military college in Saint-Jean. What a decision! Once again, the federal Minister of Finance is asking Quebec to do its share in his budget. The government is closing the military base at Saint-Hubert. Over 600 people will lose their jobs. It is cutting another 285 jobs on the Bagotville base. Before the cuts, less than 15 per cent of all federal military facilities were located in Quebec. What is left? Not much.
What should we tell taxpayers in Quebec who feel that the federal government costs them too much money for the return they get on their investment? If Quebec were to patriate the power to tax and to spend-about $30 billion is in question here-we would be able to set up a system which really is fair and we would make our own decisions. That is how Quebec will best be able to develop and grow.