Debates of Oct. 23rd, 1996

Montreal's Economy

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, in a few seconds the Leader of the Reform Party will rise to accuse me of investing too much in Montreal on Monday, by helping Bombardier develop a new 70 seat aircraft to take advantage of an increasingly accessible market. We have been helping this company for a very long time. It is now the sixth largest aircraft manufacturer in the world and very soon will rank fourth. The company received $85 million on Monday. We have to choose our priorities, and that is the one we chose.

As for the pharmaceutical industry, the legislation is in effect. There will be a review at some time, as required by law. We will have to see whether the pharmaceutical industry is fulfilling its obligations to engage in research and development and to locate facilities in Canada, and if it is, the legislation will be maintained. The industry has made certain commitments which I hope it has met. When the House of Commons reviews this question, a decision can be made. It is true that in the past three years there has been pressure to amend the legislation, but we have not done so. The leader of the opposition does not seem to be aware of that fact.

Securities

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

Mr. Speaker, while he cries over Montreal's fate, what the Prime Minister wants in fact is to deprive Montreal of a financial and economic decision making centre. There was the S-31 attempt to rein in the Caisse de dépôt et de placement du Québec. The Prime Minister must remember, as he was a minister at the time and took part in the decision to crush the Caisse de dépôt et de placement. More recently, there was Montreal's proposed international banking centre, which was also torpedoed by the federal government. The government now wants to create a Canada-wide securities commission in Toronto rather than Montreal.

How can the Prime Minister reconcile yesterday's fine promises to help Montreal with his plan to create a securities commission in Toronto, when we know full well that this would further weaken Montreal?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, first of all, the decision to designate Montreal and Vancouver as international banking centres has yet to be made. Second, in his speech yesterday, the Prime Minister listed a whole series of measures the federal government has adopted to help Montreal and Quebec, of which the announcement about Bombardier is but one example. In the private sector, the pharmaceutical and aeronautical industries do more research and development in Quebec than elsewhere because of the federal government's support for R and D.

As far as the securities commission is concerned, the federal government's position is very clear: if the other provinces want to, we are ready to co-operate with them. It is up to them. In fact, all those who favour this option do so because they want to protect Quebec's financial industry, because they are very much aware that Montreal is not in competition with Toronto, but with New York, London and Frankfurt. That is what we will protect.

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

Mr. Speaker, it is arguments like those raised by the minister, which border on recklessness, that have crippled Montreal's economy and continue to do so.

We have no answer regarding the pharmaceutical projects, as the Minister of Finance was hiding behind the curtains when this matter was raised. Again today when we asked about the securities commission, we received no answer from the Prime Minister or even the Minister of Finance.

I put the question again to the Prime Minister. Will he promise in this House to mind his own business and not put in place a Canada-wide securities commission that will further weaken Montreal?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, the hon. member is asking us to oppose the will of other provinces that want to protect Canada's financial industry. They are telling all the industries in Quebec that want to issue shares in Canada they will not be able to do so in the future because everything will be moved to New York.

They are saying that the people of Montreal and Quebec cannot compete with other countries, and I say to you that I am a proud Montrealer, that I am not afraid of anyone, that it is the hon. member who is afraid and he should admit it.

The Economy

[Preston Manning, Reform, Calgary Southwest, AB]

Mr. Speaker, the government claims to be interested in helping the 1.4 million jobless Canadians yet it refuses to set targets for reducing that number.

The government professes to be concerned about the overburdened Canadian taxpayer and yet it refuses to set targets for tax relief. The best way to create jobs in this country is to balance the budget and to lower taxes.

The finance minister says he is interested in setting measurable targets. What are the minister's targets for providing tax relief to overtaxed Canadians?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, as far as we are concerned, our record can speak for itself. In not one instance have we increased personal income taxes, having succeeded a government that had increased them 39 times.

In each of our budgets we have brought in selective tax cuts designed to help the poor, to help the disadvantaged, to help research and development and to help in the creation of jobs. If what the hon. member is saying is will we accept his thesis, his philosophy, that the kind of tax cuts that ought to be brought in are those tax cuts that will help the rich while gutting the programs and the poor, then we say no.

[Preston Manning, Reform, Calgary Southwest, AB]

Mr. Speaker, the finance minister says that he opposes Reform's tax relief proposals. In other words, therefore, the minister is against giving single mothers earning $20,000 a year a 95 per cent tax cut as we propose.

The minister has just said he is against giving tax credits to stay at home parents. The minister says he rejects the changes in personal and spousal exemptions that Reform proposes, proposals that will directly benefit over 13 million Canadians and two million taxpayers respectively.

Why is the Liberal government so opposed to giving single mothers, families and over 13 million Canadians tax relief as Reform proposes?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, we are not against providing single mothers with help. If the Reform Party will look at the last budget it will see that we increased substantially the working income supplement for families with four children.

If it will take a look at what we have done in the case of education credits, if it will take a look at a whole series of measures which we have brought in, every single one is designed to help the poor, to help single mothers. The Reform Party voted against every single one of these.

I will tell the House what we are against. The hon. member talks about helping single mothers. We are against gutting welfare programs because that is what single mothers depend on and that is what Reform has used to pay for its tax cuts for the rich.

[Preston Manning, Reform, Calgary Southwest, AB]

Mr. Speaker, if the finance minister is against cutting welfare budgets, why has he cut $7 billion out of federal transfers to the provinces?

Reform's tax relief proposal will help all taxpayers but it will help low income Canadians and Canadian families the most. Thirteen and a half million Canadians will benefit from Reform's plan. Over one million middle to low income Canadians will pay no tax under Reform's plan. That is $2,000 in tax relief per family by the year 2000 under Reform's plan compared to the $3,000 income deduction that families experience under the Liberals.

Will the government set some firm targets for tax relief or are the Liberals satisfied with the crippling tax burden facing Canadian workers, families and employers?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, in our first budget we provided tax relief for Canadians. In our second budget we provided tax relief for Canadians and we will continue to do so.

The reductions in transfers to the provinces were less than 3 per cent of their revenues and they were substantially less than the reductions in transfers that were recommended by the Reform Party. The Reform Party essentially said it would gut those transfers. What we have done is a lot less.

Let us deal for a minute with this question of families. The Reform Party stands up and says it wants to protect the Canadian family. In those provinces where the Reform Party will gut equalization are there not Canadian families who depend on the public services that would be provided? Do Canadian families not depend on maternity, sickness benefits and unemployment insurance?

The Reform Party would eviscerate welfare payments. In the weird, narrow definition of the Reform Party, are there not Canadian families on welfare who require help? Is its vision of this country so narrow that it cannot understand the needs of ordinary Canadians?

Montreal's Economy

[Réal Ménard, Bloc, Hochelaga—Maisonneuve, QC]

Mr. Speaker, my question is for the Prime Minister, and I do hope he will answer himself.

The Prime Minister was in Montreal yesterday, where he shed crocodile tears over the sad state of the Montreal economy. Yet, the federal government's procurement policy clearly puts Quebec at a disadvantage. The value of federal goods and services not purchased in Quebec amounts to amounts to $1.2 billion, which represents a loss of $600 million to $700 million for the Montreal area, I repeat a loss of $600 million to $700 million.

Instead of crying over Montreal's economy, will the Prime Minister act positively and constructively, and restore fairness in federal procurement, which would create thousands of jobs in the greater Montreal area? Will the Prime Minister take action?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, in our system, government procurement is through public tenders. Each province, in fact, each citizen may submit a bid.

Some things are bought in one part of Canada and others in other parts, and all the provinces are treated equitably. If the hon. members are suggesting that we should stop using this system and award contracts only to those we like, that would not be honest government. It would amount to systematic favouritism.

One of the actions we have taken was to set specific rules providing a level playing field for everyone. If they really did respect the wishes of Quebecers, who, twice already, have said they want to remain in Canada, they would stop talking about referendums. Businesses would then not be leaving but moving to Montreal.

[Réal Ménard, Bloc, Hochelaga—Maisonneuve, QC]

Mr. Speaker, the referendum is an issue they raise when they have nothing else to talk about. I have a specific proposal for the Prime Minister.

Why does the Prime Minister not agree to making federal procurement in Quebec proportionate to the size of its population? For Montreal alone, this would represent a $500 million increase, which, in turn, would create 10,000 new jobs in the greater Montreal area. Why did the Prime Minister not make this commitment yesterday? Is the Prime Minister serious about Montreal?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, will the hon. member rise in this House and tell the public that, under the equalization payment system through which the Canadian government provides assistance to any region of Canada experiencing financial difficulties-and they say they appreciate it-last year, because its revenue was below a certain level, Quebec actually received an extra $500 million from the federal government?

Will the hon. member rise in this House and admit that our good policies have resulted in lower interests rates over the past 18 months and that the Quebec government actually saved $625 million because there is a good, responsible government in Ottawa?

Goods And Services Tax

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, how sad that the finance minister's vision for single mothers on welfare does not extend to granting them jobs down the road. That is what they really want.

The GST saga continues. The Liberals promised taxpayers they would axe, scrap and abolish it-the Liberal equivalent of "I'll respect you in the morning"-then they covered that whopper up with a billion dollar pay-off that doubled the tax in Atlantic Canada, followed by the Deputy Prime Minister's resignation. Then they broke their promise to end the GST on reading and now, just like the Tories used to do, they have cooked the books to bury the billion dollar pay-off and fudged their deficit figures.

Since we have known for a long time that their word is not any good-

[The Speaker]

I ask the hon. member to put his question now.

[Monte Solberg, Reform, Medicine Hat, AB]

Thank you, Mr. Speaker. Can the finance minister tell Canadians why he is now prepared to sacrifice the fiscal credibility of the country in order to pull another fast one on the voters?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, let us be very clear. Despite the obvious problems of the hon. member for Medicine Hat, the auditor general has expressed a clear, unambiguous approval of the government's books. There are no reservations. He has given us a clean opinion.

As a matter of fact we have never had a reservation on the books since we have taken office. The auditor general said that the government had acted in a way that was even more prudent than he would-I was about to use the word conservative, but I caught myself.

When we took office we found that the previous government had made a series of commitments that were not consolidated in the books. As a result the books did not provide a proper statement of the government's financial condition. We have made sure that any liability is recognized at the time it is incurred. That is proper accounting. That is what we have done.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, I think the finance minister's chin is growing.

The government just put hundreds of new tax auditors on the payroll to ferret out these same types of scams in the small business sector. If the finance minister did these things in a private sector company he would be in jail.

Will the finance minister commit today to stop the creative bookkeeping and meet the same standard that he expects small business people to meet when his auditors come knocking on their doors?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, if we had done in the private sector-

[An hon. member]

Accounting 101.

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

Exactly. Accounting 101.

If we had done in the private sector what we did here it would be called accrual accounting, which is what most businesses happen to use.

The hon. minister has promised to give the member a lesson in accounting 101 anytime he would like to have it.

What we have done is recognize the liability at the time it was incurred. If what the hon. member wants to do is accuse the government of in fact having done better on the deficit this year than we announced, that is a lot better than what the previous government was accused of, which was to always understate the deficit.

The fact is we probably have the cleanest books of almost any government around.

Montreal's Economy

[Gilles Duceppe, Bloc, Laurier—Sainte-Marie, QC]

Mr. Speaker, there was a lot of wishful thinking on the Prime Minister's part yesterday, in Montreal. The Prime Minister also shed tears over the plight of the city.

However, we looked at the Liberal agenda, which will be-

[The Speaker]

I would ask you to not use props.