Debates of March 7th, 1996

National Farm Safety Week

[Murray Calder, Liberal, Wellington—Grey—Dufferin—Simcoe, ON]

Mr. Speaker, I take this opportunity to make all members aware that March 7 to March 13 is national farm safety week. Last year in Ontario alone there were 24 farm related deaths which might have been prevented.

During national farm safety week children and parents are invited to become farm safety super sleuths. Farm families are encouraged to make a serious effort to identify and correct areas on the farm where safety can be improved.

The overall objective of the campaign is to increase the awareness of hazards present on the farm.

As a farmer, I cannot begin to stress the need for all of us to work together to decrease the number of farm injuries and fatalities in 1996 and into the future.

The Budget

[Michel Gauthier, Bloc, Leader of the Opposition]

Mr. Speaker, we were there when the budget was tabled yesterday. The budget tabled by the Minister of Finance is, in some ways, a sort of exercise in centralization with the creation of a national revenue commission, an exercise in cosmetics because it hides the nasty blows of the government's decisions to the unemployed, to women and to the provincial governments, and an expression of incompetence by the government, which has done nothing more to cut its expenditures than it did in past budgets.

My question is for the Prime Minister or the Minister of Finance. Will they acknowledge that the establishment of a national revenue commission, like the securities commission announced in the speech from the throne, is an act of centralization revealing the government's uncontrollable propensity to assume powers that are, constitutionally, in the hands of the provincial governments?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, absolutely not. What we want is to make public administration in Canada more efficient. Jurisdictions are being fully respected.

As far as the securities commission is concerned, the provinces that want to can be part of it. It will enable people who apply to issue bonds or shares on the market to get approval at one counter rather than having to apply to six, eight or ten governments. The aim is to make operations easier and more efficient. Matters of legislation will remain the responsibility of the provinces.

In the case of tax collection, it is the same thing. At the moment, income and sales taxes are collected in all provinces, except Quebec, by the federal government. This will make the job a lot easier for everyone. We want to make it even easier so that taxpayers do not have to go knocking on two or three doors, but

will have a single-window service that enables them to pay their federal and provincial taxes at the same time and place.

[Michel Gauthier, Bloc, Leader of the Opposition]

Mr. Speaker, it is surprising to see that, for the Prime Minister, simplifying operations always means taking them out of the hands of the provinces and moving them to the federal level.

The federal government has this bad habit of constantly intervening in fields of jurisdiction that do not belong to it. Will the Prime Minister acknowledge that yesterday's budget contained nothing to reduce the government's operating expenses, which would have helped reduce the exorbitant lifestyle of the federal government? A fine example is the creation of two new national agencies, which will overlap provincial agencies doing the same work.

Does he not realize that he missed a fine opportunity to realize savings in government operations?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, at the moment, the federal government collects income tax for all provincial governments, except that of Quebec. In the case of Ontario, it costs the federal government no more to do it for two levels of government than for one. At the end of the month, a cheque will be sent to the Province of Ontario. The taxpayer has only one tax return to complete, and he only has to fill in one line to indicate what he is to pay to the provincial government. It is a lot more efficient, and all the provinces have found the system works well.

So, we want to improve it and ensure it will be much more effective in the years to come. It has nothing to do with centralizing. We are already doing it and we want to do it more closely with provincial governments by including them more than they are at the moment in the administration of this department.

[Michel Gauthier, Bloc, Leader of the Opposition]

Mr. Speaker, I am going to have to come back to the Prime Minister and ask him this: Would he not agree, if the federal government were to withdraw from the field of health, where it has no business being, from the field of education, where it has no business being, from manpower training, where it has no business, if it did not get into securities, where it has no business and if it did not get into tax collecting, which is none of its business, does he not realize that the federal machinery would be less ponderous and less costly and that there would be fewer problems in Canada?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, let us take manpower training for example. We offered it to the provinces. As for health, all Canadians, including those in Quebec, want to be sure there is a national plan that provides people with the same services all across the country, because health has nothing to do with language. The day-to-day administration of health care, however, is the responsibility of the provincial governments and not the federal government.

However we believe there are values that belong to all Canadians, and I think the Leader of the Opposition with his accusations of a few seconds ago, has to realize that the federal government has cut spending more in federal administration than it did in transfers to the provinces.

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

Mr. Speaker, what the Prime Minister just said is inaccurate. It is not true that the federal government cut proportionally more than the Quebec government did in its first budget, which cut 30 per cent. What it has done is reduce its deficit on the backs of the provinces. That is what the government did.

Yesterday, the Minister of Finance confirmed that the federal government intends to cut transfer payments to the provinces for social programs by 33 per cent over the next three years.

My question is for the Minister of Finance. How does the Minister of Finance explain the difference between his speech, which talks about an increase in transfers to the provinces for social programs, and his own budget figures, according to which payments to the provinces will be cut by more than a third?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, when we look at the federal government's three budgets, we see that we cut our own programs, our own spending by about 22 per cent. As for transfers to the provinces, they dropped by less than 7 per cent, which means that our own spending was cut much more deeply than transfers to the provinces. Unfortunately, the figures are quite inaccurate.

Second, as far as transfers are concerned, they will be maintained at a level of $25 billion for two years before the growth formula kicks in. That means that, at the end of the five year period, they will rise to $27.4 billion. If we look at the Campeau budget's projections, we anticipate transferring to Quebec in 1997-98 $600 million more than forecast.

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

Mr. Speaker, again, I must say that the Minister of Finance's last statement is also inaccurate. Cash transfers controlled by the federal government will shrink from $18 billion in 1995-96 to $11 billion, a drop of $7 billion. He should not be talking about tax points, as this is none of his business. If not for Jean Lesage, who managed to wrest these tax points from the federal government, today Quebec would be taking a quite a licking.

Will the minister admit that, as a result of the cut distribution criteria, Quebec will pay proportionally more than any other Canadian province in the next five years?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, first of all, Quebec, with 25 per cent of the Canadian population, will have received 31 per cent of all federal transfers at the end of the five year period.

Second, Quebec will receive per capita 105 per cent of the national average, or more per capita than any other province.

Third, the hon. member talks about tax points and cash transfers. He should at least recognize that Quebec benefits more from equalization than any other province and that equalization payments will increase in the next four or five years. Mr. Speaker, those members are afraid of the truth.

Fourth, tax points and cash transfers should be taken into consideration. If tax points do not count, why then is Quebec asking for more? Allow me to add that if Quebec or any other province wishes to return its tax points to us, we will gladly take them back.

[Deborah Grey, Reform, Beaver River, AB]

Mr. Speaker, Canadians were looking for some kind of hope in yesterday's budget but the only thing they got was illusion. There was the illusion of job creation, an end to the cuts, an illusion to preserving social programs and the illusion of no new taxes, which looks so grand.

The reality is that the budget does nothing to create long term jobs. It only puts off cuts until after the next election. It ends the sanctimonious promise of universality for social programs. Also, by failing to deal decisively with the debt and deficit, the budget takes more money from taxpayers' pockets.

Did the finance minister really think Canadians would be fooled by a time release budget that delays tax increases and program cuts until after the next election?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, what the finance minister felt was that Canadians were given a fair budget that continued the track of deficit reduction, a budget which invested in youth, a budget which invested in newer technologies, a budget which invested in trade, a budget which provided hope and a vision for a better Canada.

The finance minister recognized that the budget would be accepted. If we look at the reaction across the country, that is exactly what has happened.

[Deborah Grey, Reform, Beaver River, AB]

Mr. Speaker, the reaction I have been getting on the talk shows I have been doing today is that people are saying that 10 cents, 20 cents, 30 cents, 40 cents out of every dollar they are sending to the government is going to pay the interest on the debt. That is money that cannot go to hospitals, universities and jobs.

How does the finance minister have the nerve to say he has addressed Canadians' anxieties about hope and vision over the future of medicare, CPP and other social programs when interest payments remain the largest single government expenditure?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, the hon. member asks how I have the nerve when her party has brought forth a plan for the CPP that would scrap it; when her party has brought forth a plan that says no more pensions for the poor and the middle class, pensions only for the rich. And she asks how I have the nerve? She asks how I have the nerve when last year her party brought out a budget that would emasculate medicare and eliminate transfers to the provinces. And she asks how I have the nerve?

How does she have the nerve to stand up in the House and say one thing today when she said another thing yesterday? Who does she think she is fooling?

[Deborah Grey, Reform, Beaver River, AB]

Mr. Speaker, it is amazing. He was begging us for another taxpayers' budget this year and now he is misquoting it. It just seems absolutely ridiculous. The finance minister says we will continue to gut social programs and emasculate medicare but our program calls for sustained spending for medicare, not cuts as he has done.

What the minister avoids and what he got so worked up about right now is the fact that foreign banks are going to be taking so much of the money we are giving to this government in taxes hoping it will be used responsibly. He talks about the future, 2006, but he did nothing to improve the actual lives of Canadians now. Youth unemployment is still 16 per cent. The CPP is in trouble and needs something more serious than just tinkering. Social programs are being eroded.

Since this finance minister is so good at looking 10 years ahead rather than at tomorrow or balancing the budget very soon, would he please answer the following: What is he going to do? When is he going to balance the books? When is he going to provide tax cuts? When will he give us the unemployment numbers for star date 2006?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, there is something about being on that side of the House that makes arithmetic very difficult.

I said yesterday that in terms of foreign borrowing we have gone from something like $29 billion to $13 billion. The fact is that it is going to go down next year and the year after that. What most people are saying is that one of the triumphs of this government's administration is that we have regained our economic sovereignty. Why does the member not accept that? Why does the member not look at her numbers?

If I have misquoted the member's budget, perhaps she would refresh her mind. Was it not right that the opposition party said it was going to take $11 billion out of medicare? Was it not right that the opposition party was going to totally destroy the old age

security system? Was it not right that it said we should go to a super RRSP and get rid of the Canada pension plan? Was it not right that it said that tax exemptions for small business are a giveaway?

If I am wrong, I stand to be corrected. Perhaps the hon. member will give us her party's new budget and then we can debate what it really said.

[Roger Pomerleau, Bloc, Anjou—Rivière-Des-Prairies, QC]

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

For two years, the Bloc Quebecois asked for an in-depth review of the corporate tax system. The minister has finally decided to act by setting up a technical committee to look at the issue.

How can the minister think that an in-depth review of corporate tax can be conducted behind closed doors by a select group of experts, with no parliamentarian taking part in this exercise?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, this is not the case at all. The committee of experts must prepare a background document for consultation and discussion purposes. Indeed, I anticipate that our finance committee will use that document for consultation purposes.

[Roger Pomerleau, Bloc, Anjou—Rivière-Des-Prairies, QC]

Mr. Speaker, the government is putting the review off indefinitely, as it did with the GST.

Will the Minister of Finance admit that two of these experts are from Ernst & Young and Price Waterhouse, two accounting firms that each have at least five subsidiaries in countries considered to be tax havens, including the Cayman Islands, Barbados and the Bahamas? Does he think that these people have every reason to wish for tax havens to disappear?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, three members of the committee are scholars, including the chairperson. They have no bias regarding the issue. These are scholars who are able to look at both sides of the issue and also raise objections to what someone from Ernst & Young or another firm might say. If we are going to close loopholes, we might as well recruit those who know best how to find these loopholes.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, for four years leading up to the election, the Liberals vowed they would scrap the GST. The finance minister talks about nerve. Yesterday he did not have the nerve to call the GST by its name in the budget. He did not have the nerve to even mention it.

The finance minister is playing Canadians as a bunch of suckers. He is saying: "Too bad you did not read the fine print in the red book, but we are not going to meet our promise on the GST". The evidence is overwhelming. They promised it. When are they going to follow through? When are they going to scrap the GST?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, I am not sure I understand why the member needs notes to read his question; he has asked it so many times.

If I could back to page 22 of the red book: "A Liberal government will replace the GST with a system that generates equivalent revenues, is fairer to consumers and to small business, minimizes disruption to small business and promotes federal-provincial fiscal co-operation and harmonization". If the member asks me the question three more times, I think I will know this by heart.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, there is another quote he might recognize. It was made in 1989 in the House of Commons: "The goods and services tax is a stupid, inept and incompetent tax". He said that in this House. He said that he would abolish it. The Deputy Prime Minister said on national television that if it was not abolished, she would resign.

Is the minister going to keep his promise or is he going to let the Deputy Prime Minister hang on her own words, as tempting as that might be?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, the description of the tax as given by the hon. member is quite accurate. Very rarely does he speak words so true, however it is too bad he had to quote me to do it.

The problem with the tax is that the previous government did not succeed in harmonizing. It imposed on consumers a multitude of taxes. It made the tax inefficient. The previous government did not provide it for small and medium size business. We are working on a substantial streamlining and we will succeed.

When I look at Canadian culture and the absolute necessity of giving this country cultural sovereignty, I can say there is nobody I would rather put my faith in than the Deputy Prime Minister.