Debates of June 7th, 1995

Supply

[Paul Szabo, Liberal, Mississauga South, ON]

Madam Speaker, I thank the hon. member for the comment. I think the important principle here is that when the government considers changes to the way it operates, its procedure and expenditure management system and many of the decisions referred to by the member, it consults. It has consulted extensively right across the country. The important phrase is to get government right. It has to be done properly.

The direction of the government and the proposals it has put forward will more fully implement the will of the House to get government right.

[Alex Shepherd, Liberal, Durham, ON]

Madam Speaker, it gives me great pleasure to enter this debate on supply. The theme of my dissertation will be how to improve the accountability of government programs and make the systems more efficient.

I have often wondered coming to the House how it was possible that Canada created the debt it has today. I think it is $550 billion and rising. I have often wondered who was controlling the cheque books and why it was so easy for the debt to accumulate, seemingly without the knowledge of a lot of the people in control.

Did people actually ask for all the services they received, or for some reason did the system actually give them services they did not request?

No one seems to have taken responsibility for our spending behaviour in the past. The government is now doing that, taking

control of expenditures and trying to find ways to effectively reduce them.

Has the Treasury Board in the past acted as a comptroller? Time and again in investigating the role of the Treasury Board I have discovered it often delegates authority to individual departments. Invariably departments seem to control their own expenditures. Individual departments historically have overspent. In the private sector if that were the case we would expect job losses and all kinds of negative connotations. Overspending in the past seems to have been a merit system. As the department spent more money it became larger and larger.

Studying the estimates is very difficult. I know members have a great deal of difficulty going through individual estimates to get a handle on how government spends. I am looking at the estimates and I see three lines. One is the 1995-96 estimates, one comparison column is the 1994-95 forecast, one is a 1993-94 actual. None of these three columns is a place in time. None compares estimated to actual expenditures. It must be very difficult for members of Parliament and others reading these documents to make any sense of where expenditures are occurring and where we have overshot our original estimates.

How can we make government accounting more understandable? I know we are moving slowly to set up an accrual system within government and to record assets. What do I mean by that? Currently the accounts of Canada are kept on a cash basis. We only record things when we actually pay for them and we only record revenue when we actually receive it.

I am not trying to demean farmers but they have been keeping their records on this matter for the last 100 years. It seems the business of government is big business and we need a better methodology of capturing what governments are doing. A more understandable methodology would be instead of focusing on the expenditure system we now have, we possibly think about revising it. What do I mean by that?

We should look at two aspects of expenditures, investments and consumption; in other words, governments spend and what do they spend on. They spend in forms of investment, which is education, training, anything that upgrades the skills of the country.

The other expenditure is finance consumption. We look at programs like the Canada pension plan, unemployment insurance, transfer payments in support of social services. These are all programs in essence that finance consumption.

If we could look at government accounts from a more focused point of view and ask ourselves whether it an expenditure for investment or an expenditure for consumption, we would have a better concept of how governments spend and more effectively how governments can spend so they are actually putting some good back into the economy. For instance, do we want to spend money on training or do we want to spend money on unemployment insurance? Clearly our focus should be to upgrade skills, possibly focusing on high school students who have dropped out of the educational system and upgrading their skills so they can get back in the workforce.

If we undertook an accounting system a little more focused it would give us a better idea of how governments spend and why. Clearly we have to reduce total expenditure but while we are reducing total expenditure we should also consider a shift from the consumption side of government to the investment side.

Today I was pleased to introduce a private members' bill. Since it deals almost exclusively with this very area, certainly a coincidence, I cannot help but resist in speaking a little about what that private members' bill would do to increase the accountability of government programs.

The bill basically requires all new programs entered into by the government, individual departments presenting programs to the House, prior to their being presented, be properly costed. Properly costed means they also have a certification by the auditor general that the methods of projecting costs were appropriate. This goes back to some of my original comments.

How did we get into the problem of overspending in the first place? It seems we have fallen into a lull where we bring in programs that sound good, somebody says they cost a certain amount but nobody really knows because they have not taken the time to do that properly, and two or three years later when the bills start coming in we discover the thing is way out of hand.

The bill would also take these programs and cost them on a per capita basis. In other words, each individual in the country would know that he or she is paying x number of dollars as a share of this program. That may give individuals in the public domain a better perspective of what they are paying for these programs.

People feel very removed from the estimates and other aspects of government financing. They feel it is not their money. Many people believe in magic, that somehow things happen magically either in Ottawa or the provincial capitals, that somehow the money coming back to them is not really theirs but the next door neighbour's or someone else's. If there was a proper accounting system that costed programs on a per capita basis, people would take more of an interest in the kinds of programs governments are announcing.

Other aspects of government must be encouraged to create competition. Competition can be created within government, within departments and also between governments and the private sector. Competition will also breed efficiency.

In addition, a very important aspect of spending in the federal domain will be to affix responsibility. In other words, line managers should be responsible for their expenditures. We should also consider remuneration partially based on successful management of programs.

I had a very interesting tour of a Darlington nuclear reactor which is in my riding. I was very surprised at what Ontario Hydro of all places has done. It has actually made individual managers responsible for the number of kilowatt hours produced in that plant. If the managers are under they lose part of their bonus. This marks the way we should be dealing with our expenditure programs as well.

[Mike Scott, Reform, Skeena, BC]

Mr. Speaker, when the hon. member started his intervention he said he was reflecting on how Canada got to be in the debt situation it finds itself in today. He was somewhat perplexed. He was wondering who had control of the cheque book.

I am a little amazed this member would think the Reform Party would be so naive that we did not know who had control of the cheque book. Does the hon. member recognize the names of MacEachen, Turner and Chrétien who all had control of the cheque book in the seventies and the eighties while this debt was being racked up?

I find it amazing that Liberal members in the House will ask how did Canada get into the situation that it is in today and will start pointing fingers at the Tories and others and not be willing to shoulder the blame themselves, because the blame falls squarely on their shoulders.

[Alex Shepherd, Liberal, Durham, ON]

Mr. Speaker, I thank the member for his comments. It is unfortunate we have to take a serious matter such as government financing where we are all trying to find solutions to Canada's debt problems and turn it into a political charade.

The reality is all western countries: the United States, the United Kingdom, all OECD countries, during this same period of time ran significant deficits. It is not a unique Canadian problem. It is not related particularly to the Liberal Party, the Tories or anybody else. It was a symptom that occurred in North America and Europe, in fact, in most western countries.

I am trying to find out why it happened so it is not repeated. That is enough of an acknowledgement. The reality is we cannot talk about the past forever. We have to get on with the future, which is what the government is trying to do. It has a very good plan and it should be supported.

[Werner Schmidt, Reform, Okanagan Centre, BC]

Mr. Speaker, I am pleased to be able to ask a question. It is absolutely amazing that the hon. member does not understand how it happened. It is really very simple how it happened. If the government spends more than it takes in it will end up in a deficit situation. If the government keeps doing that every year, time and time again, the answer is that the debt gets larger and larger.

The member then makes the comment that perhaps since all the other nations are in that situation Canada would be in that situation too. This reminds me a little bit of a farmer who says: "Just because my neighbour drove his tractor into the ditch I should too". That does not make any kind of sense at all.

I suggest to the hon. member that the way this happened was that governments spent more than they took in. When are we going to be independent and responsible to the taxpayers?

[Alex Shepherd, Liberal, Durham, ON]

Mr. Speaker, I thank the hon. member for his comments. I do not think he can give me any lessons in mathematics on things I already know and that is obviously that deficits occur by the very fact that more money is spent than is brought in.

The essence of the member's question is that he does not seem to have been sitting in this place for too long or maybe he has been away. The reality is that there are significant reductions in government expenditures. The Western Grain Transportation Act will affect his constituents. The Atlantic freight subsidies have been eliminated. There have been substantial changes in attitude toward privatization. Canadian National railway is being privatized. Numbers in the civil service are being reduced. Therefore, the reality is that expenditure reductions are occurring.

The government is taking a balanced approach to this. I do not think it can cut to the point where it would actually push the country back into a recession. The growth rate in the economy right now is somewhere between 3 per cent and 4 per cent which increases government revenues. Therefore, it is a balanced approach between expenditure reductions and, at the same time, attempting to get the economy to grow.

The Reform Party would take a slash and burn approach so that the 3 per cent figure would turn into a recession and everybody in the country would be back on the unemployment lines.

[Leon Benoit, Reform, Vegreville, AB]

Mr. Speaker, I want to make a couple of points.

First, I would like to try to distance his comments from the Prime Minister who was finance minister as these deficits started increasing dramatically. If the member would at least acknowledge that an error was made at the time and that the

government was going to try to correct the error, he would be moving in the right direction.

The second point is that to make a statement that the government has lowered its spending is totally out of line. Spending in this budget, by the government's own figures, has increased by about $1.5 billion. Therefore, let him be accurate about the budget. I would think this member would know this.

[Alex Shepherd, Liberal, Durham, ON]

Once again, Mr. Speaker, the Reform Party has a lot of difficulty with mathematics.

Essentially the expenditure increases are increasing at a decreasing rate. This is the first time that has happened. The last two budgets that the government has been involved in it has actually met its targets. It is the first time that I can remember in my lifetime when not only did it meet its budget targets but actually exceeded them by $4 billion. This is a success story, not a failure.

Reform members want to go back and study history. I think this is what is wrong with them, they are not forward looking. They do not understand how we are to solve these problems because they keep looking back in the past.

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

Mr. Speaker, I wish to inform you that I will be sharing my time with my colleague from Skeena.

It is clear to everyone but the Liberal government that its 30 years of social engineering experiments have failed and failed miserably. The main reason why social programs have become unaffordable and unsustainable is because they create greater and greater dependency on social programs. No matter how these programs are designed, the end result would always be the same. More and more people would use the system and eventually it becomes unsustainable. The government can no longer afford to pay the huge sums of money needed to satisfy everyone's so-called needs. This is why half of the people on welfare today are described as employable. That is why the unemployment insurance program actually creates unemployment.

I will give an example of some of the things that the auditor general has said in his 1994 report. He said: "Rising social program use and high repeated use suggests that social programs may be creating long term dependency among some users". Here is something else the auditor general said: "Disincentives to work are created when benefits from social programs compare favourably to earnings from jobs". He also said: "Employers and employees may be using unemployment insurance to support short term layoff strategies". "Interactions among social programs may result in programs working at cross purposes to each other". Finally, the auditor general said: "Unemployment insurance may be a factor in Canada's rising level of unemployment and in the lower level of outputs that result".

Today we are debating a motion which will authorize the government through the Department of Human Resources Development to spend over $1.3 billion. The same lack of thinking that the auditor general reported last year is evident today.

The government is proposing to spend $55.3 million on grants to improve employability and promote employment opportunities. It can provide no proof that the money it has spent on such grants in the past has improved employability and yet it continues with this program. It can provide no proof that the millions and millions of dollars have actually resulted in promoting employment opportunities and actually have resulted in real jobs.

If this motion passes, the government will spend over $1 billion on grants to the sectoral training fund and on payments to facilitate the efficient functioning of the labour market, whatever that is. Study after study shows that make work projects do not create jobs. Study after study shows the government's training programs fail to train people for real jobs that are needed by the private sector.

The government cannot predict where the job vacancies will be next year, let alone five or ten years from now. When will it realize it should leave the hard earned tax dollars in the taxpayers' pockets and let individuals pay for the training they think they need? When will it realize it should leave the hard earned tax dollars in the hands of employers so they can run their own on the job training programs which are far more effective than any other type of training?

The government wants to force people into institutions to take training for jobs that are downright scarce or non-existent. It pays for training and employment programs because it supports the status quo. These programs actually support a huge bureaucracy that could not survive if it were judged on effectiveness and results. These programs support government handouts to special interest groups that are also more interested in the survival of their own organizations than they are about the workers they purport to represent.

The vote on this $1.3 billion of taxpayers' hard earned money is an admission of failure by the government. It is an admission that it is committed to repeating the failed policies of the past 30 years. It is an admission that it has no new ideas about how to get people back to work.

The government knows the only way to create real jobs is to reduce spending, balance the budget, reduce taxes. Reducing taxes creates real jobs. Government programs like these create more government spending, which creates more debt, which

creates higher interest payments, which creates higher taxes which kills jobs.

While we were having this last exchange a few minutes ago one of my colleagues went out to get a book to actually show the members opposite what the budget is all about. They do not believe that when the government says it is making all these difficult cuts it is actually increasing spending. They do not understand by their own numbers that they are not doing what they claim they are doing.

Higher taxes kill jobs. George Orwell's doublespeak is alive and well in the Liberal government. They tax the people and employers, which kills jobs, and then spend the money on programs that they say will create jobs. More jobs could actually have been created by simply not taxing the workers and the employers in the first place.

When will the government learn? How many more billions will we have to waste? How long will it take for the Canadian people to realize the Liberals and Conservatives are the same? Those who came before them and those who are here presently have been running a shell game, which benefits mainly the bureaucrats and the politicians.

Even if these programs did work, and they do not, training and employment programs are areas of provincial jurisdiction under the Canadian Constitution. It is not the job of the federal government to even be involved in that.

The federal government is proposing to spend $1,329,481,000 in an area that is the sole jurisdiction of the provincial government. If I were the premier of a province I would be demanding that the government quit taxing my people by the amount they are spending in my province and get off my turf.

If government members wanted to understand how to prepare a budget they should look at the Reform's taxpayers budget. It started with basic principles. The first principle is that we will get the federal government out of areas where they are intruding into provincial jurisdictions.

[Larry McCormick, Liberal, Hastings—Frontenac—Lennox And Addington, ON]

How come you spent all the infrastructure money?

[Some hon. members]

What would you do?

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

Members opposite are shouting all kinds of comments, asking "What would you do?" We have clearly demonstrated that. We have laid down principles. When there are principles then you build the budget on that.

We said we would eliminate 100 per cent of the grants to business. The taxpayers' budget said we would eliminate 100 per cent of grants to special interest groups. We made that absolutely clear. Is the government listening? No. It caters to all these special interest groups and it keeps funding them.

We do not have enough information in the estimates to know how many of the grants and handouts are going to businesses and special interest groups. If we did I think we could cut millions from this motion alone if they would only come clean and give us that information.

Reform also said that for all the training programs and make-work projects where the federal government is intruding into areas of provincial jurisdiction Reform would gradually return the responsibility to the provinces. Under a Reform government this process would be completed over five years to allow for a smooth transition. We proposed an immediate 24 per cent cut in this fiscal year.

Now the government will claim that Reform's principled approach is somehow hard hearted. I maintain it is both hard hearted and soft headed to keep spending money on programs that do not work. It is both hard hearted and soft headed to spend tax dollars that would produce a worse job creation record than if they had just lowered taxes.

The government will cry that thousands of people helped by the Atlantic groundfish strategy will have no alternative but to go on welfare. I have two things to say to that in response to these soft headed views. First, what is so bad about welfare in a crisis? The federal government already pays 50 per cent of the cost of the program, and if the provincial governments want to direct their welfare money into workfare and training programs, as the federal government has done, that should be their choice. It should not be decided by a bunch of bureaucrats in Ottawa.

Second, the federal government created the fisheries crisis by mismanaging the fishery. Then the federal government responded by creating a $164 million make work program for the federal bureaucrats. A better federal response to the crisis in the fishery would be to provide emergency funding to the provinces to top up what they get through the Canada assistance plan or equalization payments. Then the provinces could spend the money in accordance with the wishes of the communities and the people hardest hit by the crisis. That money should be distributed and should be used by those who understand the situation best, not by a bunch of bureaucrats back in Ottawa.

Is this too simple a solution? This government likes to play politics and create these grand programs that make it appear like it is doing something, but the simple solutions it seems to avoid. I am sure it will be a long time before any common sense

approach like this is ever advanced by the Liberal government, its power hungry politicians and money hungry bureaucrats.

[Dennis Mills, Liberal, Parliamentary Secretary to Minister of Industry]

Mr. Speaker, I listened attentively to the remarks made by the hon. member.

I remind the member we have members of Parliament from every region of the country. I believe our members of Parliament, especially the minister responsible for fisheries and oceans, who also comes from Atlantic Canada, are well equipped to give advice to the House on the types of programs that would assist their constituents when they are going through this very difficult period.

One of the things the Reform Party has to face is that it does not have any members in Atlantic Canada. Because the Reform Party does not have any members in Atlantic Canada it would like to let the local and provincial authorities do it. However, as the national party, the Liberal Party has members who are sensitive to every region of this country.

The point that caused me to rise this evening had to do with the whole issue of tax reform. I came to Parliament full of hope that the Reform Party would have a very tight focus on the whole issue of comprehensive tax reform. What do we hear day in and day out in question period? During the last couple of weeks I have had the opportunity to look at question period, and I notice that the Reform Party has not focused on the issue of tax reform. I think maybe once the member from Calgary gave a pretty good speech on it. Here is an issue that could affect the lives of every Canadian. It was the Reform Party's issue during the last election, but its members came to this House and deserted it.

The hon. member said we should cancel grants to business. The biggest grants to business in this country are the billions of dollars that are buried in the tax act, many of which go to foreign multinational oil companies in the form of tax credits. Will he stand up in the House and say that all of those tax credits, tax grants, and tax preferences should be cancelled?

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

Mr. Speaker, I will make comments on the various areas the hon. member mentioned.

If the principle I was espousing, that the people in the local areas best understand the situation and can best manage the funds and the fishery, were instituted we probably would not be in this mess today. I still maintain that one of the biggest problems with all the programs the government runs is that the bureaucracy in Ottawa is out of touch with the people in the local areas and cannot administer these programs properly.

Then the hon. member went on to blame Reform for the inaction of the government because we have not touched on this area or on that area. I find it inexcusable that the government would use that excuse to explain why it is not acting on tax reform.

We have clearly said that we need to balance the budget and we need to do it as soon as possible. If we were to balance that budget within the next three years we could begin to see the light at the end of the tunnel. We seem to think we have to provide these incentives for businesses to come from other countries and invest in Canada. Why? Because we overtax in the first place.

If we would get our act in order and begin to reduce government spending to the point where we could reduce taxes, this question that he has posed would be redundant. We would not even have to consider it. That is the problem.

We have been overtaxed to the point where we are driving businesses out of Canada. Now we try to compensate by giving them grants and tax concessions.

[Mike Scott, Reform, Skeena, BC]

Mr. Speaker, in speaking to the estimates this evening I use the example of the Department of Indian Affairs and Northern Development in my remarks.

As I said in my earlier intervention, federal spending in this department has increased 750 per cent over the last 20 years. In the past year alone, spending in this department has increased 8.5 per cent, which is faster than the rate of increase in population and the rate of inflation combined.

What are we getting for all this spending? What are the results? The auditor general expressed serious concerns about spending in this area. He pointed out that the results are not there. He pointed out that when $1 billion was appropriated and earmarked for CAEDS, which is a native economic development program, over the period of time that money was expended the demand for social services and the rate of unemployment on native reserves continued to rise at a steady rate. This massive spending on economic development had absolutely no impact on the problems that existed on the reserves.

What does the government do? It pays absolutely no attention to what the auditor general says. It pays absolutely no attention to the hard and tough questions we ask of why we are spending this money, what are the results this expenditure is supposed to achieve, and what it is achieving. The government continues blissfully on expending the money because it feels it has to. It is motherhood to them. Them cannot possibly see any other way than to continue, because this is the way things have been done in the past.

The other major problem the auditor general pointed out was accountability. I have had occasion over the last 18 months to travel to a number of native Indian reserves in Canada. I have had occasion to hear from a large number of ordinary grassroots

Indian people who are very concerned about the accountability on their reserves, who are very concerned about the fact there is a small elite group of people in their communities who are receiving a tremendous amount of largesse from the federal government and most of the people are ignored. Most of the people are not receiving any benefits to speak of. Most of the people are living in destitute conditions.

Obviously there is a very serious problem with accountability. I personally as a member of Parliament keep bringing this up and asking the minister to investigate claims, to go to these communities and find out what is actually happening. The response I get is this is an internal matter for the band to deal with and we will not get involved.

Massive amounts of Canadian taxpayers' money are being sent to reserves, to the control of an elite group of Indian leaders with no accountability to their people and no accountability in effect back to the federal government. Is that the way we want to see our tax dollars spent in this country? Is that the way we want to see our society in Canada in 1995? I submit that this constitutes a massive fraud on the Canadian people and a massive fraud particularly on the poor people in these reserve communities, who actually believe that they are supposed to benefit from this expenditure and they actually do not.

We have built a welfare state in this country. I think everyone or most thinking people have come to realize that. Over the last 30 years we have constructed a massive welfare state and we have all the resulting problems that go along with that.

There are the increased crime stats. There is the increase in poverty and the increased lack of individual initiative. The more dependency on government, the more people are willing to look at government instead of looking at themselves as the ones who are responsible for themselves.

Nowhere is this more true than in the native communities in Canada. If we think we have a welfare state in Canada, take a look at Canada's Indian reserves and see the welfare state that has been created there. It is many times worse than what we have in the rest of Canada.

I submit that what the government is doing with these expenditures is perpetrating that. It is perpetrating a fraud on the Canadian taxpayers. It is perpetrating great and serious harm to the people the Canadian taxpayers feel they are actually helping. The net result is that we are going to end up with a greater debt. At some point we are going to become insolvent. At the same time we have created a tremendous amount of harm in these communities.

[Larry McCormick, Liberal, Hastings—Frontenac—Lennox And Addington, ON]

Mr. Speaker, this debate on full supply of the estimates is an appropriate time to examine how well this government is increasing the cost effectiveness of its spending. I take this opportunity to explain some of the initiatives we are taking to make government services more affordable while at the same time maintaining or improving the quality of those services.

The government undertook the program review to identify those programs and services which in this environment of fiscal restraint are no longer needed or that the federal government no longer needs to deliver directly. The results of this review were outlined in the budget. The government has indicated the areas in which it is reducing its role or where other levels of government, the private sector or partnership arrangements can provide services more efficiently.

With respect to the programs that are truly needed and which the federal government will continue to provide, Canadians want this government to maintain the quality of its services and to deliver them in the most cost effective and responsive way possible. Affordable and quality service delivery will be watchwords of this government. For programs and services that remain its responsibility, the federal government is committed to ensuring that its clients receive quality affordable services that are accessible, responsive and balance the interests of taxpayers and those receiving the service.

With ongoing expenditure restraint, a key challenge will be to find new cost effective ways to design and deliver quality programs and services and wherever possible, to continue to make significant service and efficiency improvements in the delivery systems.

Across the government, departments and agencies are responding to this priority with innovative approaches to delivering programs such as the use of information technology, partnering with clients and other organizations and streamlining their operations. I describe for the House a number of initiatives that are now under way and which aim to achieve a public service that consistently provides affordable and quality services.

The government has developed a number of general strategies for achieving this goal: adopting more efficient ways to deliver programs; focusing on service standards and quality; providing client oriented delivery; cutting regulatory red tape; promoting fairness through cost recovery; enhancing efficient resource management; and using technology.

Following a commitment in the 1994 budget, the President of the Treasury Board released a draft declaration of quality services to federal employees in December 1994. This document identifies the following principles that all federal employees are expected to adopt in delivering quality services.

Services are to be accessible, dependable and timely. Timely access to the right service can be improved for example by making services increasingly available at times and in ways that are more convenient to the public. Services are to be delivered clearly and in an open manner. Communicate in plain language with clients about how services are managed and delivered. As regulations and decisions become more complex, make them more easily understood.

Services are to be delivered fairly and respectfully. Canadians expect to be treated in a fair and courteous manner when they use our government services. Services are to be good value for tax dollars, basing decisions on affordability, sound principles and good judgment to demonstrate the value of service to the Canadian public. Services are to be responsive and those delivering them committed to an improvement.

Ongoing consultation, asking clients what they think about the programs and services and how they can be improved is the cornerstone of quality service. After consulting employees and the public, the government will release the declaration to Canadians later this year.

Canada business service centres, CBSCs, provide one access point for information, assistance and referrals on all government programs and services to business. With the recent opening of a CBSC in Toronto there is now a network of 10 centres, one in a major urban centre of every province. In most cases these are funded jointly and operated with a province, or a province and the private sector. Clients have access to services by telephone, fax and in person.

As part of its action plan "Agenda: Jobs and Growth: Building a More Innovative Economy", the federal government has increased its support for this initiative to $15 million annually for four years. It is expanding services to meet the information needs of business clients by improving access through co-operative arrangements with community based organizations such as the economic development commissions and chambers of commerce, increasing the availability of direct computer access to the information from home or office, and continuing to improve information particularly on regulatory matters of interest to business.

Several departments continue to make services available to the public through common government access points at over 300 infocentres across Canada.

Businesses will be able to use a single business registration number which is being phased in during 1995 to gain access to several Revenue Canada business programs including those relating to payroll deductions, corporate income tax, the GST, customs duties and excise taxes. This single business registration number which will allow the department and businesses to have access to a variety of programs and services replaces at least six separate identifiers currently in use.

As indicated in "Building a More Innovative Economy" the government will have reduced significantly within three years the amount of time that small and medium size enterprises spend on federal government operations and federal government information requests in order to help stimulate job creation and a healthy, vigorous economic climate for small business.

A joint public-private sector forum of major information collecting departments and representatives from small and medium size businesses and business associations will be the focal point for ongoing consultations on government initiatives to challenge the need for the information the government currently requires from small and medium size businesses, develop means to eliminate duplication between departments and governments in data collection, and to find ways to collect the remaining information electronically to the fullest extent possible.

It should be clear to all Canadians that the program review has resulted in significant decisions on a broad range of federal government programs and services. These decisions will enable the government to serve Canadians better with renewed purpose.

The initiatives and successes I have outlined today show that the government and public service employees are dedicated to achieving affordable quality services using the most efficient means available.

The people in my riding of Hastings-Frontenac-Lennox and Addington have endorsed the 1995 federal budget. Major Canadian and international corporations have expressed their confidence in our government, our country and in the greatest asset in my riding of Hastings-Frontenac-Lennox and Addington, the confidence in our people. The workforce in my riding deserves the recognition it has received. I wish to take a moment to describe the confidence placed in my constituents.

Celanese Canada has won a $191 million expansion to its polymers facility in Ernestown township. This happened in the last three weeks. Competition for this contract came from the Carolinas and from Mexico. The manager announced that this international company was very impressed with the talents and dedication of our workforce. Three hundred or four hundred construction jobs will be created.

DESTEC Energy has started construction on its new 100 megawatt co-generation plant. This $180 million project will employ 150 to 200 people during construction.

Across the road from those two projects, Bombardier, formerly UTDC, has received a $595 million order for a light transit system for Malaysia. Our Prime Minister gave us his assistance in bringing home this contract from his Asian tour. Four hundred people will be employed from now until 1998 with this single order alone.

Nearby in my hometown of Napanee, Goodyear Canada is undergoing an expansion in the world's most modern tire manufacturing plant. Twenty-seven to thirty million dollars of Goodyear's money is being invested in our community.

These large projects will result in hundreds of direct and spinoff jobs in our communities. Between the companies involved, almost $1 billion has been committed to Hastings-Frontenac-Lennox and Addington recently. Confidence is the word to remember for Hastings-Frontenac-Lennox and Addington and for all of Canada.

Allow me one more expression of confidence. One-third of all the people in North America live within 550 miles of my riding. It is a great place to make and serve your product. All inquiries are welcome.

[Ken Epp, Reform, Elk Island, AB]

Mr. Speaker, I enjoyed the presentation by the member opposite.

I would like to know whether there is any long term goal on the part of this federal government. We have been hearing from this budgetary process that the goal is to reduce the deficit to 3 per cent of GDP. However, we have tried and have not been able to elicit a response from the minister or the Prime Minister on the question of where do we go past that.

In doing the mathematics, I think I used 3 per cent in my projections of increase in productivity in the country. Hence there is a 3 per cent annual increase in GDP, hence an increase of 3 per cent per year in the amount of the deficit which means that perpetually we add to and increase the debt. We are adding up the interest and as the interest adds to it, the principal value of the debt increases. As a result, the interest payment in absolute dollars is higher and higher every year. Using that model, by the year 2011 our debt will have reached $1 trillion.

Does the member know or has heard any of his colleagues on that side of the House indicate anything more concrete in terms of a long term goal than this very fuzzy 3 per cent, for the time being let us slow down how fast we go into debt, but after that let it increase again?

[Larry McCormick, Liberal, Hastings—Frontenac—Lennox And Addington, ON]

Mr. Speaker, I have certainly heard many people voice their concerns. It is a real challenge to reduce our deficit and our debt. As our finance minister has said, we are doing it on short term targets.

Canadians are being able to live through this period of time. If we were to follow the Reform Party budget, we certainly would have blood in the streets. People will not stand there and see their necks cut.

This week a newspaper editorial in a major Canadian daily warned the voters in Ontario that if they buy Mike Harris they will get the whole package. When our human resources development standing committee was touring the western Canada provinces, which I love so greatly, in November and December, we had witnesses coming before us with tears in their eyes, especially in Alberta, telling how the Reform type government was making cuts on the backs of the working and the poor people. I am proud to be a Liberal and be part of a government that will cut the deficit and the debt and will do it while allowing people to live.

[Bob Nault, Liberal, Kenora—Rainy River, ON]

Mr. Speaker, I congratulate my colleague for a very good speech, one that relates to the Canadian public the difference between the Liberal Party and the parties opposite.

Many of us on this side believe governments have a role to play and that governments can have a positive impact on the lives of individuals. We do not have to pull back to the point at which everyone is left to their own devices to get back to the lifestyles we had a number of years ago.

Can my colleague explain to us some of the positive aspects of the Asian tour he mentioned relating to what the federal government has done in relation to jobs in his riding? What did the Asian tour do for the job creation initiative he talked about? How much federal money is involved in the process of the Prime Minister and the ministers of the provinces when they went as Team Canada to sell our products to the rest of the world?

[Larry McCormick, Liberal, Hastings—Frontenac—Lennox And Addington, ON]

Mr. Speaker, I thank my hon. colleague for the question.

I will answer more than the question about the Asian tour. The Asian tour was a great help for all of Canada. We have a foot in the door and Canadians are working. I mentioned the $595 million order that Bombardier shared in our area.

The full order totalled $950 million. Bombardier is making money around the world today and is willing to invest in Canada. It is making rapid transit vehicles in Germany and I believe on four continents today. For this very valuable contract it has confidence in the people in our country.

Regarding the DESTEC Energy project I mentioned of $180 million, the money is coming from Texas and is being invested in our country. Celanese is investing $191 million of its money here because of its confidence in Canadians.

[Paul Devillers, Liberal, Simcoe North, ON]

Mr. Speaker, it is a pleasure to speak about the government's main estimates for the 1995-96 budget year.

The main estimates are a reflection of the government's spending priorities for its departments and programs as set out in the budget. This year's estimates lay the details for the government's planned budgetary expenditures totalling $164.2 billion.

The basic figures contained in these documents show overall program spending has declined by 10.8 per cent, from $120.9 billion 1994-95 to $107.9 billion in 1996-97.

The positive side of these dramatic spending cuts is that the government has managed for the first time in more than 20 years not only to reach its deficit reduction objective but to exceed it by $4.4 billion, without raising personal income taxes.

With its second budget, the government will be able to meet the red book objective of reducing the deficit to 3 per cent of GDP by the end of 1996-97.

I will mention some of the concerns communicated to me by my constituents prior to this year's budget and how the government addressed these concerns.

The build up to this year's federal budget saw a variety of letter writing campaigns opposing any new tax measures. I recall a few campaigns opposing any increases in personal income tax, any taxation of employer contributions to group health plans and registered retirement savings plans.

As part of the government's prebudget consultation process I wrote to the Minister of Finance requesting that group health benefits and RRSPs not be taxed. I was very pleased the budget contained no increase in personal income taxes and that no taxes were levied on the programs I mentioned.

It is important to understand that a whole new approach to governing was adopted in order to achieve the budgetary goals I referred to earlier. The program review contained in the budget redefines what government does and how its programs are delivered.

We are in fact witnessing a redefinition of liberalism. This, however, could make us forget important liberal principles such as giving everyone equal opportunities. Many Canadians feel, like me, that our social programs helped create a more just society.

After what the previous government did to social security, it is no wonder that many Canadians are concerned by any talk of reviewing social policy and public pension plans.

I am nonetheless convinced that our government can and will modernize the social safety net in order to make programs more efficient and less costly and, more importantly, to preserve access for all Canadians, whether rich or poor.

An important item in the estimates will guarantee the future viability of our social programs. The Canada social transfer will replace the current transfer payments to the provinces and territories under the Canada assistance plan and the established programs financing. Combined with the equalization payments that will continue to increase, the Canada social transfer will provide the provinces with more than $35 billion in 1996.

During the 1993 election campaign I repeatedly said what we need are more people paying taxes, not people paying more taxes. It has always been evident to me that the best way to preserve our social programs and at the same time reduce our fiscal deficit is by creating jobs. More people working means more people paying taxes and less people drawing costly benefits such as unemployment insurance. In other words, we must continue with our job and growth agenda. We need a balanced approach between spending cuts and job creation. Fiscal restraint must not be an end in and of itself but a facilitator in achieving the overriding goal of job creation.

The government did in many ways adopt this approach. Consider that 433,000 new jobs were created in 1994, many as a result of the national infrastructure program. The unemployment rate is now at 9.4 per cent, the lowest in nearly five years, productivity has surged and our trade surplus is at its highest level ever.

It is important to increase the fairness of the tax system. Again, I must congratulate the government on the progress made in that regard through measures such as these: a 12.5 per cent increase in the corporate tax rate; a 1 per cent increase in the corporate surtax; a temporary tax on the capital of deposit-taking institutions, including major chartered banks; the elimination of tax advantages resulting from the rules governing family trusts for the rich; and finally, the limitation on the scientific research and experimental development tax credit for large corporations.

These are major achievements, but much remains to be done. There is still a lot to do to help the unemployed find work and we must take a closer look at tax advantages that benefit a privileged few.

Some would attack the less privileged in our society and blame them for all our economic woes. This certainly seems to be the case in the provincial election in Ontario. However, politicians who take advantage of people's fears and anger over the future viability of our economy are doing a great disservice

to both the social and economic well-being of our country. This approach is fundamentally dishonest and very destructive.

Now that this year's budgetary process is coming to a close I offer my suggestions for the upcoming 1996 prebudget consultation.

There is much speculation in the media about the viability of our public pension plan and the necessity to review this program. I believe any review of the public pension scheme should also include a review of RRSPs. A considerable amount of money is invested in RRSPs. They have without a doubt contributed to better retirement security for thousands of Canadians.

However, the question of fairness has arisen with respect to advantages wealthy Canadians receive from current contribution limits. The last budget set limits of $13,500 for 1996-97. The limit will be increased by $1,000 a year to reach $15,500 in 1999.

Revenue Canada statistics also inform us only 6 per cent of individuals with income of less than $20,000 a year currently take advantage of RRSPs. On the other hand, individuals making $100,000 or more a year, who account for only 2 per cent of the population, account for 20 per cent of the total RRSP contributions.

In my opinion our current system of RRSPs acts as a considerable tax shelter for the wealthy because of its high contribution levels. For this reason I would not oppose a reduction in the RRSP contribution limit. This would only affect higher income Canadians because these limits are income contingent. Taxing lottery winnings is also another revenue generating avenue available to the government.

I urge the government to continuing applying fairness and compassion in budgetary policies. We must continue to give unemployed Canadians hope and encouragement, not blame them or punish them for their lot.

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, the member pointed out total spending by the government has gone up and yet program spending has gone down, which means Canadians are squeezed. We are delivering less program money to Canadians while we are transferring more and more money to the lenders. Transfer to lenders has become the biggest transfer program the government has.

The member talked about maintaining the viability of our social programs. I am concerned about the conundrum there. As the government spends less and less money on social programs surely that would destroy the viability of social programs. He seems to be taking some credit in maintaining the viability of social programs.

While the deficit continues and while we are continuing to add to the debt, which means interest costs are continuing to go up andtherefore program spending will continue to go down, how does the member intend to maintain the viability of social programs?

[Paul Devillers, Liberal, Simcoe North, ON]

Mr. Speaker, I thank the hon. member for his question. The question of maintaining social programs is very crucial and of much concern to the government. That is what the social program review initiated by the Minister of Human Resources Development was designed to address.

The deficit is being addressed by reducing it to 3 per cent of GDP. That is a minimum interim target. The finance minister stated many times in the House and outside the House that it is just that, a minimum interim target. The ultimate goal is to eliminate the deficit and repay the debt, leaving more money available to put into social programs.

Social programs are in need of review. They were designed several decades ago and have not been brought up to date. There is wide consensus among Canadians that they are in need of a review and an update and it is a question of which approach we will take.

Hon. members across have difficulty 20 months after the 1993 election still accepting that the Liberal platform clearly set out the deficit reduction goal was 3 per cent GDP in three years. That is one of the main reasons we were successful in the election. It is a concept they have difficulty accepting.

[Bob Nault, Liberal, Kenora—Rainy River, ON]

Mr. Speaker, why would he think, as the Reformers would think, that Canadians would believe it when the Reform Party says it could reduce the debt and the deficit all in one fell swoop in a three-year program and at the same time maintain jobs and growth? This is what it is saying to us, that the 400,000 jobs that were created this last year would continue to be in effect at the same time as we would take some $40 billion from the economy.

I would like the hon. member to explain to us the Reform's rationale if he could and why the Liberal Party does not seem to accept that. Not even 10 per cent of Canadians accept that, as we could tell in the last election campaign.

[Paul Devillers, Liberal, Simcoe North, ON]

Mr. Speaker, I thank my colleague for the question.

The simple answer is I cannot explain it. I certainly do not agree with it. Obviously the electorate in the last election did not agree with it. As I previously pointed out, they rejected that Reform plan of eliminating the deficit within three years. Anyone could understand that could not be done without creating tremendous hardship. As has been stated previously in the House this evening, there would be blood in the streets if any government attempted to put those kinds of cuts onto the population. That is clearly why that plan was rejected by the electorate in 1993.