Mr. Speaker, between 1993-94 and 1998-99, direct government spending will decrease by over 12 per cent. As for provincial transfer payments, the reduction will be less than 8 per cent.
At the same time, it must be pointed out that when provincial transfer payments were reduced, the reduction was less than 3 per cent of provincial revenues. This is a completely acceptable cost. Not only that, but when one looks at the cuts provincial governments have made in payments to their municipalities, we have cut much less.
That having been said, let us look at what was done in the last budget. Not only did we set an $11 billion ceiling-not a ceiling, a floor-to protect provinces, we included a formula that will see transfer payments increase after 1998.