Debates of June 13th, 1995

Government Contracts

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, Mr. Sharp advises me and ministers when we need advice. He is correct when he tells every one of us to be prudent. Being prudent is to make sure that every contribution is paid, a receipt is made, and it is published under the Canada Elections Act. That is exactly what happened in this case.

Every contribution has been above the table and according to the laws of Canada. Unless we pass a law in the House that all political party expenditures are paid by the nation, we will have to raise money according to this law. This law permits ministers and members of Parliament of all parties to raise money as long as they give receipts in accordance with the Canada Elections Act.

Job Creation

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, according to Statistics Canada, net job creation over the past six months has been zero, although the Minister of Finance's budget predicted job growth of three per cent in 1995. In addition, economic growth has literally gone flat in the first three months of 1995, with an annualized growth rate of 0.7 per cent, yet the Minister of Finance forecast in his budget that the rate of growth would hit 3.8 per cent this year.

Since everything points to the fact that the minister's predictions will not come true this year, will he acknowledge that zero economic growth will not generate any new jobs and that he is going to have to review his budgetary forecast regarding the deficit?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec]

Mr. Speaker, firstly, I would like to congratulate the hon. member for getting his leader to allow him to ask a question.

[Some hon. members]

Oh, oh.

[Paul Martin, Liberal, LaSalle—Émard, QC]

I know why this is; those hon. members contradict themselves so much.

I would like to point out to the hon. member that over 200,000 private sector jobs were created in the past eight months. This trend even applies in Quebec, where over 50,000 jobs were created in the past year.

There is no doubt that the economy is slow, due to a slowdown in the American economy and to the fact that the economic recovery was based mostly on our capacity to export. This having been said, most economists predict that the slowdown that everybody was expecting next year will hit us this year and that next year, we can expect a recovery.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, instead of spinning yarns, the Minister of Finance would be well advised to take a real look at his balance sheet since coming to office.

Mortgage rates, for example, have increased by 30 per cent, the growth rate for exports dropped 90 per cent over three months and there has been no net job creation over the past six months. That is the real balance sheet of this government, of the Minister of Finance. Therefore, he should have given me real answers and real figures instead of making it all up.

I would like to ask him the following question: Will he acknowledge that a growth rate of close to zero confirms the failure of his economic strategy, which has not enabled us to create any new jobs or to offer Quebecers and Canadians the hope of dignity through employment, which the Prime Minister keeps on repeating?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec]

Mr. Speaker, I have no idea where the hon. member gets his figures. Maybe from the "Just for Laughs" festival. Please allow me, Mr. Speaker, to give you the real figures.

The unemployment rate in May of this year was 9.5 per cent, compared to 10.4 per cent in May 1994; shipments in the manufacturing sector were 17 per cent higher this month than in May 1994; the trade balance surplus hit an all-time high of $23.2 billion in the first quarter of 1995; the deficit in Canada's current account, which is normally around 4 per cent, is currently at 2 per cent. We are very proud of our accomplishments.

Bosnia

[Bob Mills, Reform, Red Deer, AB]

Mr. Speaker, since it appears the Canadian hostages in Bosnia are being released, the government now has an opportunity to safely scale down the Canadian commitment to Bosnia, which is scheduled to end in just three months. An orderly withdrawal started now would take about that time to be completed.

Will the Prime Minister end his chronic waffling and hand-wringing and announce the Canadian contribution will not be extended beyond September?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, as I said, the Canadian soldiers there are playing an extremely useful role. We have decided to extend our mandate for another six months. We will make a decision at that time. We have to finish the job we started. We will not quit in mid-term. We said we were to be there for six months, and Canadian soldiers and the Canadian people are the kind of people who do the job they say they will do. If we decide to go it will be decided in accordance with our commitments and with our partners in this situation.

I have to say to the House of Commons that when we look objectively, before the UN troops arrived there were approximately 200,000 people killed in one year, and it was reduced to 3,000 last year. This means the presence of the UN troops there has saved thousands and thousands of lives. The Canadian soldiers and the others in the UN force have done a very good job.

[Bob Mills, Reform, Red Deer, AB]

Mr. Speaker, talking about Bosnia, the Prime Minister stated in this House: "We are very far away from this part of the world and in many ways it is somewhat more of a European problem than a Canadian problem".

If the Prime Minister actually believes what he said, will this be the position the government will take at the G-7 summit?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, of course I said it is more of a European problem than a Canadian problem. But peacekeeping around the world has been a very proud policy of the Canadian government.

We have had peacekeepers around the world. We initiated peacekeeping during the Suez crisis when Mike Pearson created that solution to solve that very difficult war with Great Britain and France versus Egypt.

Since that time Canadians have always been present at peacekeeping operations. We have been in Cyprus; we have been in the Golan; we have been everywhere there has been a need for Canadian soldiers. There is nothing more satisfying for me when I am travelling to meet with the leaders of other countries than to have them tell me that Canadian troops are always the best.

Youth Unemployment

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, my question is directed to the Minister of Finance.

The first victims of an economic slowdown are always young people in low-paying jobs. The situation has continued to deteriorate, since youth unemployment has gone up from 11.2

per cent in 1989 to 16.5 per cent in 1994, an increase of nearly 50 per cent in five years. In Quebec, more than one out of every three unemployed workers are young people.

When we realize that young people are usually in low-paying jobs, how can the Minister of Finance expect to give them any hope, when he has no job creation policy to offer and on top of that, limits their access to unemployment insurance by making them work for at least six months to qualify for unemployment insurance benefits for the first time?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec]

Mr. Speaker, we are very concerned about the unemployment situation among young Canadians. We have always been very concerned about this, even before the economic downturn we are experiencing today. That is why at the beginning of our mandate, the Minister of Human Resources Development put in place a number of programs for the purpose of creating jobs for young people, to provide incentives for them to go back to work or start a career.

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, how can the minister seriously claim that his government has given young unemployed workers hope and the dignity of work, when the unemployment statistics fail to reflect a situation that many are experiencing, and I am referring to the fact that more and more young unemployed workers are on welfare?

[Lloyd Axworthy, Liberal, Minister of Human Resources Development and Minister of Western Economic Diversification]

Mr. Speaker, if the hon. member looked at the figures he would see that the unemployment rate for young people is now at its lowest point since 1990 when the recession began.

The job creation measures have helped to bring down the youth unemployment rate by three or four points to its lowest level. In the meantime, to recognize the special importance of young people, in this last year we have increased the direct investment for youth training and youth employment programs from $193 million to $236 million, a net increase in this one year alone. At a time when budgets are very limited and we are facing real fiscal restraint we have increased the investment for young people by $43 million. That means this year we will have 15,000 to 20,000 young people enlisted in various forms of internship programs, the youth service corps and other youth-related programs.

Our commitment to young people admits of no question from the Bloc Quebecois. We are committed to helping our young people get back to work.

Economy

[Ray Speaker, Reform, Lethbridge]

Mr. Speaker, the Liberals' February budget based its revenue projections on a GDP growth of 3.8 per cent. The actual growth in the first quarter of 1995 was less than 1 per cent. There is little prospect of improvement in the second quarter. The budget did not plan for a recession.

Is the Minister of Finance willing to admit that his budget forecasts are wrong and that his deficit targets are being threatened?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec]

Mr. Speaker, our deficit targets are not being threatened. At the time we made them we made it very clear that we have brought in both prudent assumptions for growth and for interest rates. We also put in place substantial contingency reserves. I can assure the hon. member that we are on target in terms of the deficit.

The hon. member knows as well that a majority of economists projected strong growth for this year with a decline in growth next year in the United States and consequently in Canada. The view today on the decline that was projected, I believe, is that it is going to occur earlier than expected and that it should lead to an increase in growth next year.

[Ray Speaker, Reform, Lethbridge]

Mr. Speaker, there is speculation certainly in that answer. I do not think the minister can downplay the current poor economic conditions. A lot of Canadians are very concerned. They are concerned about their jobs. They are not buying houses as they did a few months ago. They are not buying cars. Consumer purchasing is down.

Reform has told the minister that the one thing government could do to restore consumer confidence is to lay out a plan to eliminate the deficit. The minister and the government have not taken our advice.

My supplementary question is for the same minister. What is the plan of the government to restore consumer confidence and avert a recession in the country?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development-Quebec]

Mr. Speaker, the hon. member knows that consumer confidence is not dependent on whether the government provides, as we have decided to do, rolling two year targets in deficit reduction or a longer target.

The member also knows that the credibility of long term targets by Canadian governments has not been all that great. We are the first government in a long time to not only hit its target but to do substantially better. This is the realization of a

government doing what it said it was going to do which is to re-establish confidence in the country. I am very confident.

Yesterday, Gallup polls found that the Canadian people had more confidence in the government's handling of the economy than any government in the last 22 years. That is confidence.

Bosnia

[Jean-Marc Jacob, Bloc, Charlesbourg, QC]

Mr. Speaker, my question is for the Prime Minister. Last weekend, the Bosnian President tried to meet the American President, Bill Clinton, to have the embargo on arms to Bosnia lifted. In the American Senate, a majority of Republicans and Democrats voted in favour of lifting the embargo, but the President is maintaining it for the time being.

Given the importance of maintaining the embargo, did the Prime Minister reiterate the need to maintain it to the President of Bosnia when they met?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I did exactly that on my trip to Sarajevo last June. Speaking on behalf of the French and the English, who knew I was going there, I told the Bosnian Prime Minister himself, in Parliament in Sarajevo, that, for us to maintain our troops there, it was vital the embargo not be lifted.

Our position of last year remains unchanged, and I am pleased to see that the President of the United States respects it.

[Jean-Marc Jacob, Bloc, Charlesbourg, QC]

Mr. Speaker, while the Prime Minister's position is clear on the embargo, how does he explain the fact that, 48 hours before the start of the C-7 Summit, Canada has yet to decide on its participation in the rapid reaction force, which is to be debated at the G-7 Summit in Halifax?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I have expressed the government's position, which is that we are not keen to take part in this new initiative. We have said so to our partners. We are still looking at the proposal.

We want to know exactly what form the force will take, what the chain of command will be and what the relationship will be with the UN. We still lack satisfactory answers on many points, and so are not prepared to make a commitment.

Goods And Services Tax

[Sarkis Assadourian, Liberal, Don Valley North, ON]

Mr. Speaker, my question is for the Minister of Finance.

The government has been restoring hope and prosperity by fulfilling commitments made in the red book. One of those commitments on page 22 involves replacing and eliminating the GST.

Will the Minister of Finance outline the progress that has been made with respect to the GST? Is he any closer to seeing this commitment implemented?

[Paul Martin, Liberal, Minister of Finance and Minister responsible for the Federal Office of Regional Development -Quebec]

Mr. Speaker, the member for Don Valley North has shown a great interest in this subject, as has the Prime Minister.

As the member knows, there is tremendous support for harmonization among consumers and among small business. Already there are tremendous savings from greater efficiency.

The problem has been that a number of the provincial governments have not seen the same degree of urgency. I am glad to say that we have had a number of very fruitful meetings with a number of the provincial governments. There is no doubt that we are progressing.

In the last budget in Quebec, there was virtual harmonization realized. We have all seen the public statements of premier elect Harris to the effect of his interest.

When the hon. member for Don Valley North goes back to Toronto, if he sees premier-elect Harris, he can tell him that as soon as he names his finance minister, whoever he or she may be, I will meet them here in Ottawa, Toronto, Nipissing or I will meet the new finance minister in the member's office in Don Valley North.