Mr. Speaker, it is always a pleasure to rise when you are in the Chair. I believe I have 20 minutes. You will understand that I want to make sure that this is indeed the case.
I am pleased to participate in the debate on the borrowing authority and, consequently, on the budget. This is the second Liberal budget and we must keep in mind the truly disastrous economic context which affects the unemployed. Once again, the Minister of Finance did not provide anything for the 1.4 million jobless. This budget is particularly unfair to Quebec, primarily because no concrete decentralization measures are proposed. There is no indication of a willingness, on the part of the federal government, to transfer to the provinces fields of jurisdiction which, in many cases, the provinces would be better able to look after.
In the case of Quebec, there is of course the issue of manpower training. As you know, there is a very strong consensus in Quebec, which includes chambers of commerce, unions, as well as the Quebec government. They all agree that Quebec would be better served if its government looked after manpower training which, as you know, is one of the links between social and education policies.
Yet, there is nothing in the budget that leads us to think that the federal government wants to fulfill the commitments it made earlier. As the hon. member for Saint-Hyacinthe-Bagot said repeatedly, this budget is unfair. It is unfair because nothing is done about family trusts. In this issue, the government acted somewhat like Star Trek, in the sense that it announced a measure, but "beamed it up" or rather beamed it forward to some time in the future.
Indeed, it was announced in the budget that the rules governing family trusts would be reviewed; however, the changes will take effect just before the year 2000. What is a family trust? It is a despicable scheme which legally allows a number of wealthy people to avoid paying taxes by using a truly outrageous provision. Yet, nothing is provided in this budget to tackle the problem.
It is also an unfair budget-this has been pointed out repeatedly but it does not hurt to say it again-since farmers in Quebec will lose $32 million, especially dairy producers, a sector which has undergone major consolidation at the instigation of the various governments we have had in Quebec in the past ten years. It is an unfair budget because farmers and dairy producers will lose $32 million, while western producers will receive an additional $2.9 billion.
One of the worst aspects of this budget, and this is one of the areas where the Reform Party and the Bloc Quebecois agree, is that it fails to provide anything in the way of tax reform. Take the banking sector. When we look at who benefited most from the 1982 recession and the subsequent recession, it is clear that the banking sector finished first. The big chartered banks in this country with their many branches across the country have made absolutely outrageous profits during the past few years. And they are the only ones that managed to emerge unscathed from the first and second recession.
Mr. Speaker, do you think the government would have had the guts and the social conscience to tax the profits and capital gains of the banks? Of course not. And that is probably the true measure of this government. A modest tax of $100 million is peanuts. Just look at the banks' profits in 1993-94 alone: $1.2 billion. That being said, we are convinced that the government could have asked the chartered banks in this country to contribute more.
What does the government do? It asks for a piddling $100 million, when the Royal Bank alone, the open-minded bank, made a profit of around $1.2 billion. The government could have asked the banks to contribute more, but it did not. Of course, one does realize there is a definite connection between the financing of certain political parties, and I am not naming any names but I am looking at them, and this timid treatment of the banks.
Another issue that gives cause for concern and which people are worried about, and no wonder, is transfer payments to the provinces.
The issue of transfers to the provinces, as you know, Mr. Speaker, is absolutely central, because it has to do with the balance of relations between the central government and the provinces. It is therefore an absolutely vital issue. Three characteristics are identified with respect to federalism, Canadian federalism, which some of your pages are studying in political science courses across the country.
It is a two level form of government, usually with a central government and a lower level of government, which could be provinces or townships, but there are two levels of government.
It is a system with a constitution providing that the governments are autonomous in all jurisdictions under their authority. A court, in this case the Supreme Court, acts as arbiter in these matters. Why am I saying all this? Because provincial transfers have been and remain the central government's traditional method of destabilizing provincial public finances.
How do you think individual provincial ministers of finance can manage to plan and establish coherent economic development policies, if the central government destabilizes public finances in every province by reducing transfers out of hand, unilaterally and without consultation? Allow me to give you some specific figures in this regard. The federal government will cut $2.5 billion in transfers to the provinces in 1996-97 and $4.5 billion in 1997-98.
These are not insignificant amounts and this will have a major impact on the provinces' ability to plan. In the case of Quebec, transfers will be cut by $700 million in the coming year. This means that Quebec will shoulder 27.1 per cent of the total cuts, whereas it has 24 per cent of the population. Things will not improve in 1997-98, because it will then have to shoulder $1.88 billion in cuts to transfer payments.
What is shocking in all this, and this is where the connection must be made, is that the present cuts to the provinces will obviously be on top of what has been cut since 1982. If you add up all the cuts in transfers to the provinces from 1982 to 1998, you will discover, hon. colleagues, that the provinces will be facing a shortfall of $48 billion. Therefore, Mr. Speaker, you will understand that this way of doing things goes totally against harmony in the federal system.
In any case, and the Government of Quebec is not the one saying so, two premiers from the west who, after reading the Martin budget, declared that it was the death knell for Canada, because there is no way for the provinces to develop coherent economic development policies if the federal government keeps on shamelessly cutting transfer payments. As we all well know, transfer payments are not something theoretical, not just rhetoric; they directly affect the provinces' ability to provide health and education services, and these services are at the heart of our citizens' quality of life.
However, I will focus my speech today on the pitiful trick played on the unemployed. The history annals of Canadian federalism for the early 1990s to the year 2000 will tell the story of the slow and despicable dismantling of the unemployment insurance system. Please remember that unemployment insurance is the only social "insurance" program offered by the Canadian government, "insurance" as opposed to assistance, that is, meaning that workers and their employers share the cost of the unemployment insurance system.
As you all know, in 1990, the Canadian government went as far as completely stopping its contributions to the unemployment insurance fund. This means that, as I speak, Canada is the only western country with an unemployment insurance system where the government does not contribute to its UI fund. This means that virtually all of the benefits paid out to workers are paid for by the work force and their employers.
We must acknowledge the fact that Canadian workers are in mourning. They have been since 1990, because from that point on Conservative and Liberal governments alike have derived a sadistic pleasure from dismantling the unemployment insurance system.
I would just like to remind you of what governments past have done, without, of course, forgetting the Chrétien government, which, led by the Minister of Finance, has disgracefully ganged up on the unemployed.
It all began in 1990 with Minister MacDougall, who dealt the first blow, who made the first attack on the unemployment insurance program. You will recall that in 1990 when the government decided that it would no longer contribute to the unemployment insurance fund, Mrs. MacDougall proposed an increase in the minimum qualifying period and a reduction in the maximum benefit period, with the overall result that, for the first time, a government reduced by 10 per cent its costs of financing the unemployment insurance program.
Not content with this initial assault on the program, in 1993 Mr. Valcourt-whom the voters, thankfully, did not re-elect-came back to the charge and lowered benefits from 60 to 57 per cent of insurable earnings. Remember that in the 1970s, benefits were at 70 per cent of insurable earnings. Now they have dropped to 57 per cent and are often below the poverty level. This is a disgrace.
What does this mean financially? Cuts in benefits of $850 million in 1993 and $1.6 billion the year after. The Liberals are obviously no better than their predecessors. And this is why the Bloc Quebecois has always said that, red or blue in Ottawa, the future is black without the Bloc. What has the Martin budget done for unemployed Canadians in 1994? Increased the minimum qualifying period and reduced the maximum benefit period. And we are not talking about 57 per cent coverage, but about 55 per cent. In 95 per cent of cases, we can expect claimants to get 57 per cent of insurable earnings. This is the kind of social solidarity that this government has decided to have with the unemployed. Did you think that the finance minister was going to stop there? Certainly not. The budget that has just been tabled talks about cutting benefits by $750 million in 1996 and 1.5 billion the following year.
In the early 1940s, UI was intended as a generous program on which all the provinces agreed. It was the first amendment to the Canadian Constitution. Look at what happened to unemployment insurance under the repeated attacks of the Tories and the Liberals. UI has become an exclusion program. In fact, the UI account, which posted a $3 billion deficit in the 1990s, will show a $5 billion surplus at the end of the fiscal year.
One would think that this government would have done the right thing, that it would have shown enough solidarity to use this $5 billion to create and maintain jobs for the unemployed. No, this government shamelessly attacked the unemployed. It will arrange for a surplus to be deposited in a deficit fighting reserve fund, although funding of the UI account does not have anything to do with the government's ongoing operations. The Liberal government has appropriated the Tories' shameful legacy.
Allow me to make a final point. We would have expected the Liberals, in accordance with the red book, to put forward defence industry conversion measures. As we know, 10,000 jobs are threatened in the coming days. That is no secret; it is a well-known fact. Both the aerospace industry and the provinces demand defence conversion measures. This demand is not exclusive to Quebec. What conversion measures did the government take? It did not put forward any concrete measure.
It is unable to plan for the future and use its leverage to help workers. There is no vision. This is an attack against the unemployed. That is why we have no qualms about presenting the golden raspberry award to the Minister of Finance for all he has done.