Debates of April 16th, 1996

The Budget

[Marlene Cowling, Liberal, Dauphin—Swan River, MB]

Mr. Speaker, I am pleased the member asked that question. It allows me on behalf of the government to set the record straight. Quebec does get its fair share from this Liberal government.

When we talk about subsidizing and tariffication I know there is fairness. I am a farmer myself. The minister of agriculture has worked very hard with groups within Quebec to ensure Quebec continues to get its fair share.

[The Acting Speaker (Mr. Kilger)]

There are approximately two minutes remaining. I would like to split it evenly between the question and the answer.

[Jake Hoeppner, Reform, Lisgar—Marquette, MB]

Mr. Speaker, I see we are going in the right direction by stressing the importance of value added industries.

Would the hon. member for Dauphin-Swan River comment on why we have lost value added industries like milling plants, pasta plants and slaughtering plants? Why has it come to the point where we are more or less exporting our raw resources instead of adding value to them?

[Marlene Cowling, Liberal, Dauphin—Swan River, MB]

Mr. Speaker, clearly the member of the third party is out of touch with what is happening. I mentioned in my speech that the government is bringing forward opportunities for diversification and value added enterprises.

I gave examples that happened in the hon. member's home province of Manitoba. There is more optimism in the agri-food and agriculture sector than I can ever remember. The government is doing very good things for the agriculture sector and for farmers right across the country.

[Maurice Bernier, Bloc, Mégantic—Compton—Stanstead, QC]

Mr. Speaker, I am pleased to take part to this debate, following the speech on the budget. I would like to take a few minutes to talk about the comments made by the member for Dauphin-Swan River and Parliamentary Secretary to the Minister of Natural Resources. As a matter of fact, the speech she has just given was somewhat out of touch with reality, to say the least, in terms of the repercussions that the budget already has and will continue to have on Canadians.

She talked in particular about agriculture. As my colleague from Longueuil has so well explained, Quebec farmers will lose a good part of the advantages that federal subsidies gave them. In order to show how reality is completely different-otherwise the hon. member must be living a an environment totally different from ours-she said that the budgetary decisions made by the Liberal government have made farmers in her area very happy indeed, that everyone is happy, that every farmer she meets is smiling since the government decided to do away with the grain transportation subsidies.

I can understand why farmers in the West are smiling. If I were one of them I would be grinning from ear to ear. Over two billion dollars in subsidies were given last year, in the 1995-96 budget, to compensate for the reduction of grain transportation subsidies.

The non taxable part of the support was assessed. Western farmers received cash outs to compensate for the decrease in the value of their properties and they were given direct subsidies to facilitate the transition to other types of agriculture. The subsidies given to western farmers to compensate, as I said, for the loss of wheat transportation subsidies, are estimated at $3 billion.

Meanwhile, what is happening in the east? As my hon. colleague indicated, our farmers are required to pay more for their grain but when the time comes to apply similar measures to them-I am referring to milk subsidies cuts-there is a double standard.

Last year, the government reduced milk subsidies paid to producers by 15 per cent. This year, producers are told that the subsidies will be completely eliminated over a five-year period, without any form of compensation. And the hon. member is telling us that all is well and everyone is happy with the decisions made by the federal government?

Our colleague, the Secretary of State for Agriculture and Agri-Food and for Fisheries and Oceans, and member for Beauséjour also stated, in response to a question from our critic for agriculture, and repeated in this House that, following the decision made last year to cut the subsidies paid to producers, consultations-to which both the Secretary of State and the Minister of Agriculture participated-would be carried out to sound out the opinion of the industry. Now the Secretary of State rises in his place and formally declares in this House: "We have the support of milk producer associations to use this approach". He said so and repeated it with a straight face, without flinching.

As the Secretary of State for Agriculture and Agri-Food and for Fisheries and Oceans, and member for Beauséjour was making this statement about milk producer representatives being in agreement, I was reading, in my hometown newspaper, La Tribune , what the president of the milk producers association had said. This is not a member of the Bloc Quebecois. Perhaps he is a separatist at heart, but it is not obvious from the article.

What does he have to say this dairy producer representing his union in our region, in the Eastern Townships? "Ottawa is on the backs of the farmers". He criticizes the elimination of the subsidy over a five-year period. He proves beyond a doubt that the federal government acted unilaterally. So if the minister and the Secretary of State did in fact consult anyone, it certainly was not these

people. Representatives of the UPA in the Eastern Townships and throughout Quebec never at any time agreed to such a measure.

The head of the UPA in the Eastern Townships, Jacques Dion, added that other demonstrations will be needed. It is time to bring out the tractors. This is the only way, it appears, the government understands.

I do not think my colleague for Dauphin-Swan River met with the same representations, needless to say, and I understand. I have just explained that the decisions affecting the west do not have the same scope as those affecting the east-and it is not just Quebec, we are talking about Ontario too. So, to say that the agricultural measures in the government's budget were positive is, to say the least, going too far.

I would also like to talk about cuts in the area of unemployment insurance. In fact, the main measures, the primary effects of the budget we are seeing this year are not to be found in the 1996-97 budget, but in the 1995-96 one, since the cuts to transfers to the provinces announced last year took effect last year and this year. As far as unemployment insurance is concerned, it is the same thing. The Minister of Finance added to his revenues to reduce the federal government's deficit. He dipped into the unemployment insurance fund and took nearly $5 billion.

The cuts that will result from the changes made to the UI legislation will make the surplus in the UI fund grow bigger, which means that the government will be able to draw even more money from the fund to reduce its deficit at the expense of the unemployed. Everyone in Canada knows that, because of federal government policies, the unemployment rate in Quebec is much higher than the Canadian average.

In that sense, Quebec can be said to be principal homeland of unemployment in Canada. The motion passed by the Liberal Party on the weekend could have said, in addition, that Quebec is not only predominantly French speaking, but also one of the places where the unemployment rate is the highest. As I said, we have the federal government's long-standing policies to thank for that.

Let me give you just one example. The oil refining industry in Montreal has completely disappeared as a result of decisions made by the federal government. There is a long list of this kind of decisions.

I will conclude on this because you are signalling that I have only one minute left. We have the feeling of living in two completely different worlds when we meet in this House. When I hear government members praise this budget, I catch myself thinking about the poor, the unemployed and the people on welfare who are listening to such remarks. They must be telling themselves: "What country is this? Is this the right place? Perhaps I should have my head examined. My perception of reality must we skewed, because that sure is not how things are for me. I keep growing poorer and poorer, while being given less and less opportunities to break out of poverty".

That is the reality. That is the kind of effect the budget before us is having on people.

[Jim Abbott, Reform, Kootenay East, BC]

Mr. Speaker, I was very interested in the member's comments about his constituency in the area of the eastern townships. I had the pleasure of having him visit my constituency of Kootenay East about a year and a half ago when we were doing some work on the European Union meeting. He will be familiar with my constituency which is probably not too dissimilar to his.

I would like to advise him that it is not just a case of British Columbia, Quebec, Prince Edward Island or Manitoba. There is no selection on the part of the central government to bring in hostile action or activity toward Quebec.

I would suggest that he consider what he learned while he was in my constituency about the kinds of primary activities many businesses in my riding are in, which he has indicated are common to his constituency. Many practices of the central government that are construed as being aimed at or against Quebec are not aimed at or against Quebec. They come from an ignorance based on the central myopic, closed mindedness which exists in Ottawa and is exhibited by the Liberal government time and time again.

It is not a question of picking on Quebec. We only need to take a look at the way the Liberal government of another time brought forward the national energy plan which created a full depression in the province of Alberta. It is just ignorance on the part of people at the centre. It is not aimed at the people of Quebec.

While I recognize the hon. member is here as a member of Bloc Quebecois with the objective that Quebec should become a sovereign nation, he nonetheless should open his mind to this fact: more often than not the problem has absolutely nothing to do with the central government trying to persecute his province or any other area. The persecution is just out of straight ignorance on the government's part.

[Maurice Bernier, Bloc, Mégantic—Compton—Stanstead, QC]

Mr. Speaker, I had indeed the opportunity in the past to visit the riding of my colleague from Kootenay East at his invitation. It was a very rewarding experience for me, and it was greatly appreciated. I met

some very nice people, and I would like to publicly thank my colleague for his invitation.

That said, when he accuses me of being ignorant or of misinterpreting the facts by suggesting that the federal government is discriminating against Quebec compared to western Canada, I simply want to remind him that, in my remarks regarding agriculture, I insisted that this would affect milk producers in both Quebec and Ontario, where this industry is concentrated. I never said that Quebec was being singled out.

I said and I continue to say-my colleague can interpret this as an argument in favour of our sovereignty objective, but the facts are there-that the federal government's decisions concerning Quebec's economic development have had a disastrous impact in several sectors, including oil refining. This is a fact, and I invite my colleague to come and visit Montreal's east end. Some of my colleagues will be pleased to show him the disastrous impact of these policies. He will see that this is not an opinion, but a very concrete reality.

[Paul Crête, Bloc, Kamouraska—Rivière-Du-Loup, QC]

Mr. Speaker, I am pleased to take part in the debate on the budget, which is now coming to an end. For years we have been told about the need to control the federal debt, about the fact that this huge debt would require a decentralizing process, about the fact that while federal politicians did not have the political will to do it they would have no choice because of budget constraints. Yet, this is not happening.

Why? First, because the federal government has found another scheme to continue to get involved in fields of provincial jurisdiction and to spend like it did before. I am referring to the UI fund. The government has made hostages of employers and workers. First, it makes them contribute to the fund and then it uses the UI surplus to continue to get involved in manpower training and to set up programs in various social areas which come under provincial jurisdiction.

In a way, this is a variation of what the Trudeau government did for years, when it borrowed on foreign markets to preserve its artificial Canadian dream. Now that it can no longer rely on international lenders because our indebtedness has reached an unacceptable level, the government has found another way of doing the same thing by using the UI fund.

The current situation is highly unusual in that there is a big surplus in the UI fund, but the government will still target seasonal workers, those who rely on UI benefits every year, not because they are bad workers, but simply because they work in industries which cannot operate throughout the year and because there are no other jobs available for them during the winter months. These people are like hostages. Moreover, they are low and middle-income workers who will still have to do more to help reduce the deficit, since the government decided to lower the level of UI contributions of high-income earners.

This is very surprising on the part of a Liberal government. It seems as though the Liberals have given up their social democratic principles of the seventies in favour of the ideas of the Conservatives and the Reformers, something they should not be proud of.

There are also some fairly amazing examples of federal intervention. While claiming there is no money the government created a health research fund with tens of millions of dollars available in a sector that comes under provincial jurisdiction. That is set out clearly in the Constitution. The provinces have developed expertise in this field, and the federal government takes it upon itself to create a health research fund, after having created the national forum on health, which will be providing us with findings that are out of step with the every day reality, with what is experienced every week by the bodies responsible for health services in each of the provinces, where concrete front line solutions must be found.

When all is said and done, it is always the same taxpayer who will pay for the national forum on health, who will pay for the health research fund, the same one who will pay for health services in Quebec and in the other provinces. The taxpayer may well ask why duplicate administrations are necessary. Can we still afford such a thing?

Another example is the desire to create a federal securities commission. Here again, there are provincial securities commissions in place. They have proven themselves and all that is needed is for them to be linked up, but a superstructure such as the federal government wishes to put into place is not necessary on top of that. It just means more administrative costs.

The government would have shown good will if it had said "In this area at least we have not been involved in the past, so we will not go putting our big feet into it, adding to the debt and the tax burden of Quebecers and Canadians".

In this budget, there is no desire on the part of the federal government to cut back on its lifestyle. The key point I feel must be made is that this budget contains no initiative for solving the main problem of Quebec and Canada. If you survey people today and ask what the main problem in our economy is, they will answer "employment".

Employment, and the fact that the full potential of our people, in Quebec and in Canada, their potential and abilities, are not being made use of. We have to keep doing so. Fantastic technologies have been put in place, which cast aside people who had the skills and the ability to do things.

There are people who were working in forest management, who, in the past, would cut timber. What are we doing with them? Are we casting them aside? With the increased productivity machinery affords us, we decided to forget about these people all over the place and not make proper use of them.

This is what is happening with young people as well. The budget contains rather distressing measures, such as the reduction in the amount people can contribute to labour sponsored venture capital corporations or to the new CSN fund. These programs were put in place a few years ago, a decade ago. They created jobs; they maintained some; they allowed unions to put money into businesses, to better understand how the business worked and therefore to more easily help with management and avoid confrontational labour relations.

The government has decided to reduce the amount people can contribute to these funds. At the same time the surplus in the unemployment insurance fund is being increased. In other words, money is being taken from productive funds and put into more bureaucratic funds, which are not very effective. There is still time for the government to act to avoid such a mistake, which will have a disastrous effect on employment.

The budget contains another disappointment in the area of employment and that is, as regards a review of taxation, the only thing this government has chosen to do is set up a technical committee. They decided to put off by at least one year the decisions that will have to be made, when it has been already two years since they came to power and when people from all levels of society have clearly expressed their concerns in this regard. We must find ways to use the human potential available to us.

We have nothing against businesses making big profits, but we must ensure that the productivity gain serves not only to accumulate money but also to use people's potential. The government must ensure that, when compared to other societies in North America, in Europe or elsewhere in the world, Quebec and Canada are seen as really using the potential of their people. We did not only give a chance to the stronger ones to make money and to succeed. We managed to put everyone's potential to good use.

The handicapped must be able to maximize their capacity to work. Young people entering the labour force for the first time must have had a chance to maximize their potential, in order to avoid the present situation, where a lot of people with technical and professional training and even people with university degrees just waste their potential over years. At some point, it is as if they were no longer in the labour force. Then, it is much harder to have them re-enter the labour force.

I think the government should have made a special effort on that front, but it did not do so.

We are often told that the opposition does not suggest any solutions. On that matter, there were some. The government ought to have mentioned a specific goal in the speech from the throne or in the budget. Just like it did in matters of deficit control, it should have set a job creation goal by stating: "The goal is such and such a level. In one year or two we will have reached that goal and, thanks to our political commitment, we will have chosen to really develop people's potential".

It could be done also through specific tax measures that would benefit employment. A business cutting jobs because of new technologies should not only reap advantages in terms of tax exemptions but should also be made to bear some costs because it is sending to the unemployment lines employees who previously had a job. We must find ways to do that. These are not things that will come about by the interactions of various market forces. The government has a regulatory role to play, and I think it resides in actions of this type.

We could also have implemented an action plan for all departments. Imagine if the Prime Minister had said: "For 1996-97, the goal is to reduce the unemployment rate. Each department will have its own objective in that area and will have to report on its performance one year from now, just as we did for the deficit". The public would have been happier at the end of the year. We would have put to good use the potential of a whole generation and kindled hope in young people who would have been encouraged to start a family, have children and perpetuate our society.

The 1996 budget could have been the means to such an end. But that is not the case and that is why we will vote against it.

[René Canuel, Bloc, Matapédia—Matane, QC]

Mr. Speaker, I would like to thank my colleague. He has put his finger right on the problem, and it is an even larger problem in rural areas and in the regions.

This budget affects farmers. We talked about that earlier. My colleague opposite seemed to say that everything is going as it should, while in the east things are desperate.

For the unemployed this budget is a disaster. In my area, in Amqui, a small town of 6,000 inhabitants, 4,500 to 5,000 people demonstrated to protest against the employment insurance plan, and they did not do so for the fun of it.

I remember very well that 20 years ago the same people or their fathers or mothers demonstrated in the streets because unemployment was at an unacceptable level. This year, their children have taken to the street, because the unemployment rate in my region is even higher.

This means that this budget is not a source of hope but of hopelessness.

Another thing I have just found out is that, as in the case of the royal military college in Saint-Jean, the Maurice-Lamontagne Institute, a research and development centre in my riding, that is wellknown at the local, national and international levels, because its researchers come from all over the world, is facing drastic budget cuts that will force several of its staff to go find work elsewhere.

When I asked the Minister if this was true, he told me about the need to streamline, that it was Mr. Martin's fault. In my region, it is very difficult to accept. They are going to cut funding to Quebec's only fisheries research and development school. What tells me that the amounts will not be increased in Ontario or elsewhere?

This is really very hard to take in Quebec. I referred earlier to the Collège militaire royal in Saint-Jean, where our officers used to receive superb training in French. That is gone. Now funding for the Lamontagne institute will gradually dry up. This was a venture with a future, with plans to increase the number of researchers over the next five or ten years, until drastic cuts were announced.

If that is what my hon. friends opposite call a good budget, I suggest that they go and tell that to the regions. As far as producers from my region are concerned, the president of the Dairy Farmers of Canada lives in my riding, I could almost say in my parish. He told me: "René, it will have a terrible effect". It is terrible, although most producers in our region get by. In terms of climate, when I travel to Gatineau, I notice that farmers there can sow one month sooner. In our region, farmers have to wait one month, sometimes six weeks more before they can do so. Such are the laws of nature and there is nothing we can do about it. As a result, farmers in the east are penalized. And so are fishermen, with their quotas being cut.

My hon. colleague from Kamouraska-Rivière-du-Loup has painted a very accurate picture of the situation. I have a simple question for him. What future will our young people have after this budget is implemented? Will there be incentives to remain in the region longer? The university is 120 kilometres away. Up til last year, the only cégep was located in Matane, and there was none in the Matapedia Valley. This meant that, just to attend college upon graduating from high school, our young people had to go to Rimouski, Matane or Quebec City. That is totally unacceptable.

I will put my question again to my hon. colleague: Does he foresee a better future for our young people? Will they be able to remain in our regions longer?

[Paul Crête, Bloc, Kamouraska—Rivière-Du-Loup, QC]

Mr. Speaker, to respond briefly, I would say that hope must be kept alive. It is not true that there can be no future; we must take the future into our own hands and do something with it.

I think that if the government was really serious about developing the regions of Quebec and Canada while reforming unemployment insurance, it would have implemented economic diversification policies so that we do not end up in the same situation as the Institut Maurice-Lamontagne in Sainte-Flavie, which is cutting jobs in research and development as UI standards are being tightened. This is an unacceptable contradiction. This is a message of hopelessness for young people.

A message of hope would be to tell everyone they are committed, to share their hopes for the future with their political representatives, and to elect governments that will make choices and give priority to job creation so that they can be proud of their future professional achievements.

[Charles Hubbard, Liberal, Miramichi, NB]

Mr. Speaker, I will share my time with the hon. member for Carleton-Charlotte.

The budget debate over the last several days clearly indicates the dilemma the people of this country must perceive as they watch it on television. The Bloc criticizes the government for reducing spending and cutting back on programs. Reform, although somewhat inconsistent in its dissertations, generally condemns the government for not balancing the budget by reducing expenditures and eliminating programs.

As the only national party in the House, we the Liberals must reflect the concerns of all Canadians. We must have a program and a plan to direct our economy and create a climate that will stimulate growth, encourage investment, enhance consumer confidence and create jobs for the Canadian people.

The budget as presented by the Minister of Finance on March 6 has been well received across the country. It is the continuation of a long term plan with specific short term objectives. The finance department, like the Department of National Defence, has always been a very difficult portfolio for Canadian politicians. The tenure of many of them has been very short. The minister has done an excellent job. His vision, determination and perseverance are appreciated by most Canadians.

Canada's debt was and is a major problem. Nine years of Conservative mismanagement saw our national debt increase from approximately $168 billion to more than $500 billion during that period. Annual deficits were often in excess of $40 billion. With interest rates of nearly 8 per cent to 10 per cent, 25 per cent of government revenues are and have been directed toward interest payments to lenders both in Canada and abroad.

It is not easy to bring our financial house into order. Abruptly reducing spending within a budgetary framework where interest payments and legislated spending accounted for approximately

75 per cent of revenues would have created hardships for many Canadians and possibly bring havoc to the Canadian economy.

The prescribed cutbacks in the three budgets in 1994, 1995 and 1996 are a determined effort to gradually reduce government spending. The annual deficit as a percentage of gross domestic product will move from 6 per cent to 3 per cent to 2 per cent, and hopefully by the turn of the century we will have a balanced budget.

The 1996 budget proposes some very reassuring commitments to Canadians. Seniors, through benefits for those of age 60 and older, will have a definite plan for their retirement.

The Canada health and social transfer program will be guaranteed a five year commitment which will encourage the provinces to do their own budgeting.

There is a program of jobs and growth, especially for our youth, with emphasis on education, technology and international trade; a school network program for more than 1,000 rural communities; a partnership with provinces for food inspection and other government agencies; a concern for child support and programs to assist families with educational credits, child care expenses, credits for infirm dependents and a doubling of the working income supplement; all of these without any increase in taxation.

It is surprising that as I listen to the opposition we are not hearing a great number of positive comments and suggestions that could be brought to future budgets. The budget, for example, encourages the Department of Revenue to attack the underground economy. We also must continue to be concerned with loopholes and policies. They are unfair to many Canadians as they approach the taxation system.

We might ask, for example, if we can continue to permit large corporations that are concerned only with maximizing profits to avoid what might be a fair amount of taxation.

Can we look at bank machines that have replaced tellers, closed rural banks and eliminated thousands of jobs? Can we watch big companies such as General Motors lay off employees through outsourcing of work while making profits of more than $1 billion? Can we watch these large corporations pay their executives more than 50 times the salary of some of their yearly workers? Can we continue to permit those earning $1 million a year to pay the same tax rate as those who have taxable incomes of $60,000? These are some of the questions the opposition might be asking.

This to me is a good budget in terms of the financial problems the country has faced. We must not forget we have nearly a 10 per cent unemployment problem. It is especially a problem for our youth. All of us in the House must strive to make Canada a better place for young people as they seek to find gainful and meaningful work.

We must insist that employers be fair, compassionate and considerate. Business has a role to play. We are hopeful it will participate in programs that will assist our youth, our greatest resource, in promoting the future of the country.

The budget outlines the government's plans for revenues and spending. Its success depends to a large extent on the ability and willingness of our people and businesses to pay their fair share for the support of government programs.

I call today for all civil servants to watch their spending, to avoid spending if it is only to consume the allocations for their department, for their agency. Canadians must be assured of true value for their hard earned tax dollars. They have always been supportive and generous. We as politicians must encourage strong controls and insist that specific spending be justified.

We must not overlook the fact that many Canadians are hurting. Too many cutbacks by both business and government attack those in our society who are least able to defend themselves. We must ensure that downsizing of governments does not place the entire burden on those of low income or who are in difficult economic circumstances.

Atlantic Canada and many areas of other provinces are concerned with UI reforms and the concentration of activities in larger centres. As parliamentarians we must work to ensure compassion, fairness and understanding. In our committee work and in reviewing estimates especially we must be very diligent.

The budget reflects our Liberal principles and I am happy to support it.

[Nic Leblanc, Bloc, Longueuil, QC]

Mr. Speaker, I heard the hon. member talk about a reassuring budget. I would rather call it distressing.

For example, the Budget in Brief provides that the shortfall between the government revenues in 1996-1997 and its program and service spending will be $26 billion, which means that Canadians will pay $26 billion more than they will receive. In my opinion, this is very distressing.

We are going bankrupt, there are no two ways about it. In 1997-98, the governement will provide $35 billion less for programs and services than its tax revenues. These figures are distressing.

It is also distressing to think about the national SchoolNet program mentioned by the hon. member, given that education

comes under the exclusive jurisdiction of the provinces, particularly Quebec. Indeed, it is distressing to hear that as well.

It is distressing to hear that the federal government will look after families, since social welfare also comes under the jurisdiction of the provinces. It is distressing to hear that from the government in office.

It is distressing to see that next year the debt service will amount to 50 per cent of all the money that taxpayers will give to the government.

It is distressing to hear that the unemployment rate is only 10 per cent, given that the government has reduced the number of weeks during which UI benefits can be collected, even though that rate is not really going down. By contrast, the number of welfare recipients is increasing, particularly in Quebec.

This is a simple case of transfer. People go from unemployment insurance to welfare. Moreover, the federal government is forcing the Quebec government, among others, to pick up the slack since it reduced the number of weeks during which UI benefits can be collected.

All this is truly distressing. And we are told that this is a reassuring budget. I realize that the hon. member represents the government, but still. Maybe he can explain all this to me. I doubt he can, but I will listen.

The little chart here refers to the financial needs of central organizations, expressed as a percentage of the gross domestic product. It puts Canada in first place. However, that does not take into account the deficit of the provinces. We are told that the public debt represents 74.8 per cent of the GDP. However, if you include the deficits of the provinces, the ratio is 105 per cent. We are the nation in the worst financial shape among all industrialized countries. I would appreciate it if the hon. member could make all this more clear to me.

[Charles Hubbard, Liberal, Miramichi, NB]

Mr. Speaker, all Canadians realize that we have to have a balance. We cannot continue to spend just because we have a certain figure today. The message which Canadians gave us in the last election, which they are still giving us on the streets today, is that somehow we have to bring our financial house in order. If we continue, as the hon. member says, to build programs and to spend more money, I do not think that is what Canada wants.

In reply of his comments on the UI program, the House of Commons committee has been reviewing the proposals. The minister, who comes from my province, will work with that committee to ensure that Canadians who are most in need will have programs which will enable them to continue to live in an economically healthy family unit.

I certainly appreciated his comments. I also appreciated the comments which were made by the hon. member from Rivière-du-Loup. However, we have to appreciate the fact that there are Canadians who are in need and as a government, we will continue to help those Canadians who are most in need.

[Harold Culbert, Liberal, Carleton—Charlotte, NB]

Mr. Speaker, I am delighted to have the opportunity to speak during this portion of the 1996 budget debate.

I would like to begin with a brief overview of where the nation stands financially, where it has been and what the goals are as Canadians for a common future.

When assuming office in the late fall of 1993 this government was soon to comprehend the realities associated with an immense $42 billion deficit for the 1993-94 year, a $500 billion plus debt, a $6 billion deficit in the unemployment insurance fund, and overall what had progressively become an uncontrollable financial catastrophe which was headed for disaster.

Should the government have been a business at that time, the creditors would have been looking to place the locks on the doors.

Canadians from across the nation voiced their concern and their demand for change to be focused on deficit reduction and debt control. Canadians demanded that the government begin a process which would initiate the stabilization of our economy.

The proud citizens of this great nation grew tired of the threatened economy. Canadians desired financial stability so they could hold their heads high in the face of world economies, proud and united under a strong financial force, a country that could very efficiently manage its finances.

Canadian citizens deserve the assurance of knowing that our children and our grandchildren will have future opportunities. That can only result from a well-managed country.

The Liberal government accepted the challenge, fully aware of the difficulties and the obstructions which might lie ahead. It began a process known as program review, which would review every line of expenditure of every department, not excluding government operations, in order to ensure that the necessary expenditure reductions would be established.

Establishing goals that were challenging and far-reaching, the government has now begun to see the gradual reduction of the deficit, while at the same time protecting and supporting the valued Canadian social programs.

Not only did it meet its established goal of reducing the deficit to $39.7 billion, it exceeded that goal by an additional $2.2 billion, for an overall reduction to $37.5 billion in 1994-95. The goal for the 1995-96 fiscal year, which just ended this past March, was to reach a further reduction to the $32.7 billion mark. I am optimistic that

once the auditors complete their work we will once again exceed the established goal.

The new fiscal year of 1996-97 which began April 1 calls for the government to meet a further reduction goal toward a new deficit level of $24.3 billion or 3 per cent of gross domestic product.

What could this figure mean to Canadians other than it is a yardstick or a metre stick used by many countries as a measurement of sound economic management? This measurement represents the future success and prosperity of Canada and the probability of job creation and economic stability both for our generation and generations to come in the future.

Many Canadians ask: "What has the Minister of Finance done in the 1996 budget to further meet his original goals and obligations?" The Minister of Finance has introduced another new goal, another new challenge for the 1997-98 fiscal year. That challenge is to continue the downward trend to a new and lower level of deficit, to 2 per cent of gross domestic product or approximately $17 billion.

Interestingly enough, the goals we have accomplished and continue to accomplish are somewhat similar to the goals that were brought forward by the previous administration. However, the goals set previously were never met in whole or even in part. This government will not follow the example of the previous administration. It will continue to meet and exceed our goals for deficit reduction and our commitment to Canadians to balance our budget.

I believe these thoughts are best summarized by the remarks made in the 1996 budget by the Minister of Finance: "In the budget we are keeping the course, we are maintaining our pace, we are not letting up. Indeed, this government will never let up. The attack on the deficit is irrevocable and irreversible. Let there be no doubt about that. We will balance the books".

Such a statement, sincere and based on facts, demonstrate that our recent success in reaching our goals is quite irrefutable. Mr. Speaker, would you not agree?

What could be the result of the minister's actions? Confidence. Confidence in the Canadian economy. Confidence that has allowed financial institutions to lower interests. Mortgage rates are lower today than they were when I bought my house some 28 years ago. Interest rates in Canada are lower by 2 to 3 per cent than they are in the United States. When was the last time that happened? Certainly not in more recent years.

Although many accomplishments have been achieved, there is still a lot of work to be done. This work will be continued in the same balanced fashion to ensure that spending reductions do not come at the expense of the poor. The 1996 budget actually targeted increased resources to youth, to low income seniors and to the working poor. All of the government's accomplishments have been made in light of other priorities, namely economic growth and job creation.

Canadians have voiced their demand. Citizens want increased employment opportunities. In order to satisfy this objective indirectly, in the long term, the government continues to support economic growth through deficit reduction strategies. More directly, government is pleased to announce the creation of over 500,000 new full time jobs since assuming power. Canadians have asked for more economic growth and additional jobs. The government is responding each day by creating more new jobs and promoting economic growth. The task at hand is a difficult one, particularly since we have partly alleviated decades of deficit and debt in a few short months.

This past Friday I had the opportunity to be part of the announcement of a new plant that when completed this fall will create 25 new jobs. This number does not include the spin-off jobs in transportation or in construction of the plant. Once again, congratulations to CANUSA Foods Limited, of Centreville, New Brunswick.

Further expansion and job creation in Carleton-Charlotte was recently announced by McCain Foods a few weeks ago, detailing the upcoming expansion of their data processing centre. The facility will double in size, creating 30 or more new jobs in Florenceville, New Brunswick.

Sabian Cymbals has recently moved to its newly constructed larger and more modern facility in Meductic, New Brunswick with the expansion encompassing an additional 12 to 15 persons.

In York Mills, Briggs & Little Woollen Mills have recently constructed a new facility after surviving a severe fire in the fall of 1994. It will soon be reopening with employment once again available for many area residents.

In addition to the many industries in Carleton-Charlotte that are expanding, congratulations are also extended to the many industries that continue to maintain numerous stable, full time jobs. Our sincere congratulations are extended to all those industries. I am delighted to support the 1996 budget. I am very proud of its accomplishments today and for the future.

[René Canuel, Bloc, Matapédia—Matane, QC]

Mr. Speaker, my hon. colleague talked about job creation. He said that jobs are created every day. He said that 500,000 jobs have been created since his government came into office. However, how many jobs have been lost during the same time?

Of course, we are all morally responsible. Those who should bear the most responsibility are those who have created the deficit, the debt. When Mr. Trudeau came into office in 1970, he began to get the country deep into debt. And this went on. When the Conservatives came to power, they did not do any better.

It is true that we have a responsibility, and I think that everybody here has benefited from that in some way. Some a lot, some less. However, those who benefited the least are the poor, and more particularly maybe the people living in rural areas like mine and in isolated areas. Now, today, we are asked to show restraint, to tighten our belts, and very often those who have benefited the most are asking those who have benefited the least to suffer the consequences. That is unfair.

Yes, I recognize that we all have some responsibility. Yes, I recognize that I myself have benefited somewhat from it. But at least let us not ask those who hardly benefited at all from it to tighten their belts even more today.

Someone said earlier that we have to find money somewhere. The question is where do we look for that money. We proposed and we are still asking that we look for it in the family trusts and the banks, because they definitely benefited a lot from it. Therefore, they should at least pay a fair share of the bill. I have here a long list of duplications that everybody can see. The Minister of Finance has seen it himself.

I will repeat just part of what he said. Just about every small business has had a federal tax auditor drop in, followed by a federal sales tax auditor, a provincial corporate tax auditor, and a provincial retail sales tax auditor. All these people wanted to get the same figures. And they all came at about the same time and on the same day.

The government has just realized that, but we have been pointing out this problem for years. I could give many more examples of duplication, but my question for my colleague is this: Instead of targeting those who did not gain any advantage from this collective debt build-up, should we not be going after those who did mightily, and have them foot part of the bill?

[Harold Culbert, Liberal, Carleton—Charlotte, NB]

Madam Speaker, I thank my hon. colleague for the question. I too represent a riding that is very rural. It is over 200 miles long and has varied economies including agriculture, forestry, fisheries, manufacturing and processing. We try to be very diversified.

There is no doubt that we are part of a changing global economy. If we are going to keep up we have to progressively move forward to ensure that our people have the best training possible. The government is attempting to put in place tools that will allow our communities and our citizens to take advantage of opportunities.

I agree with the member that there is hurt. I am sure there is hurt in each and every constituency across Canada. We must offer a helping hand. Controlling the deficit, getting it on a downward trend as this budget has accomplished, certainly promotes confidence. It sets the tone which allows us to continue to help.

[Monte Solberg, Reform, Medicine Hat, AB]

Madam Speaker, I will be splitting my time with the hon. member for Elk Island.

It is a pleasure to address the House on the budget once again. I will start by putting things in context. Many speakers have stood up today and pointed to the size of the debt. It is critical that we put this whole debate back in context.

We have huge debt in this country. It is unparalleled in the world for the size of the country. Our debt today stands at $578 billion. We are paying somewhere in the range of $47 billion a year in interest payments on that debt which will rise to almost $50 billion before the end of the government's mandate. The issue is important considering the context.

The GST was not in the budget but the Liberals have frequently promised to discuss it, even as late as last summer. During the election campaign hon. members across the way campaigned door to door saying that the GST would be history if the Liberals were elected. I do not have to tell Canadians that is not the case today. The GST is still with us despite what the Deputy Prime Minister said on national television 10 days before the last election. She said: "I will resign if the GST is not abolished."

The Prime Minister and the finance minister said similar things. They said that it would be gone, that it would be scrapped. "I hate it. I will kill it." Those are the sorts of things that they said during the election campaign.

[John Harvard, Liberal, Winnipeg—St. James, MB]

Find something original.

[Monte Solberg, Reform, Medicine Hat, AB]

I see the hon. member from Winnipeg. He was out campaigning against the GST. Now he is mouthing off across the way but all those words do not eliminate the GST. It is still there.

We hear that the Liberals are working to harmonize the GST. Why are they working so hard to put another form of the GST in place? Why do they not do what we have recommended? Why do they not balance the budget and get rid of the GST? Why not eliminate it in stages? Surely, after putting up with all this fiscal restraint, Canadians deserve a reward. Why not grant them that reward in the form of a GST that ultimately disappears? That would

be a wonderful reward. People do not need that tax burden. They have paid a heavy price over the years and it is time they were given that reward.

I will talk about the government's approach to deficit reduction. The finance minister in his budget speech talked about the importance of being fair. I could not agree more. One of the fairest approaches is to make the cuts in a timely fashion. If spending reductions are made in a timely fashion that means we do not pay the price of delay. Canadians really are paying the cost of delay in spades because the government has delayed so in long making its cuts.

In the 1994-95 budget the government cut virtually nothing. It had a golden opportunity to put in place spending reductions that would have put us further ahead than we are today. During the election campaign my party campaigned on a zero in three deficit elimination plan. If that plan had been implemented when the government came to power, today we would be debating what to do with the surpluses. We would not be talking about another $24 billion deficit which is what we are facing.

Over the course of the government's mandate it is going to add $117 billion to the overall debt. That is unbelievable. The Liberals are crowing about the good job they have done. However, let us remember Canadians are paying a heavy burden.

The finance minister talked about fairness which I will also talk about. Is it fair to take $8 billion out of social programs and give it to money traders around the world? I do not think it is. In effect that is what the government has done by waiting as long as it has and by being so timid in the cuts it has made over the course of the last couple of years. It has waited that long. The interest has built up and money is going out of the country never to be seen again.

Who pays the price? The most vulnerable in society pay the price. That is why the Reform Party advocated cuts right away. We also advocated setting priorities and getting those priorities right. We said let us cut at the top. Let us cut MP pensions, for crying out loud. What did the government do? It made sure it welded them into place so members would have their pensions, while it talked about cutting benefits for everybody else. That is bizarre and ridiculous. That should not happen but that is exactly what happened under this government.

We say let us get rid of all of the perks. Let us get rid of all the extra expense around this place. Let us make some economies at the very top. If we do that then we can talk with some authority about the cuts that need to be made throughout government. Unfortunately, they do have to be made throughout government.

In anticipation of questions from hon. members across the way, they are going to make reference to the approach of the Reform Party. We presented a very extensive budget preceding last year's budget which laid out all kinds of initiatives for the government to follow. What did the government members do? They sat there and mocked us. They have said they want to see it again this year. Well we have laid it out for them. The approach is there.

For instance in the area of health care we would have cut about $800 million. What did the government say? It said that was too deep, that we should not cut that deeply. What did the government do? It cut $3.2 billion in health care. It closed more hospital beds across this country than any provincial government, probably more than all of them combined. I think it is time Canadians knew about that.

We would have cut $200 million out of higher education. What did the government do? It cut $1.2 billion out of higher education. That is the cost of delay. What did the government do when we said we would cut $200 million? It said we were slash and burn. The government is cutting $1.2 billion which is unbelievable. Again, this is the cost of delay.

The deficit is not all due to the cost of delay. The Liberals also decided they were going to continue to fund their friends in big business which is why we have all kinds of money going to all kinds of unbelievable places in Canada today. Why do the Sears department stores have to get money from the federal government? Why does Eaton's need to get money from the federal government? Why does American Express get $17,000 from the Canadian government?

There is also $121,000 going to Abitibi-Price. Mark's Work Wearhouse gets $99,000, the Hudson's Bay Company gets $5,000; on and on it goes.

Here is an interesting case which I would like my friend across the way to justify. Why are we sending $105,000 to the Canadian Bankers Association? Banks earned $5 billion in profits last year and the Canadian government is giving the bankers association $105,000. That is unbelievable. It says here that the grant was from the Department of Human Resources Development for training, which is unbelievable.

Members across the way should be ashamed. They should stand in their places and chastise their government. I hope they have the intestinal fortitude to stand at the budget vote tonight, as the hon. member for York South-Weston says he will do, and vote against the government for that kind of hypocritical spending. It is absolutely ridiculous.

I encourage Canadians who are watching the debate to take everything the government has said with respect to the progress it has made with a grain of salt. I ask them to look at where it is cutting.

This is not the beginning of the end of the deficit problem in the country, it is the end of the beginning. The government has barely scratched the surface. Let us hope that it sets its priorities in a way that is mindful of the needs of ordinary Canadians.

[Ronald J. Duhamel, Liberal, St. Boniface, MB]

Madam Speaker, I listened to what my colleague had to say. I will make a few comments and perhaps raise a few questions.

He indicated that his party did not advocate any perks. I have been told-I believe he has read the same documentation-that there are some members of his party who fly executive class. Perhaps he would like to comment on that.

At one time it was said that members of the Reform Party would not go to the parliamentary restaurant and some do not; some Liberals do not either. That is supposedly a perk yet he has said no perks.

It was not long ago that the leader of his party returned a used vehicle he was entitled to after which he received many photo ops. It was discovered shortly thereafter that on the side he was getting approximately $30,000 from his party in order to help buy his suits, shirts, ties and whatever else he needed. I am told he did not pay taxes on it either. It may have been for some other purpose, but it was over $30,000. I do not get it. I would not take it. I am surprised with his kind of rhetoric that he would have.

I have been told about something which I find to be a perk. During the election someone on a disability pension ran for political office. Well, I do not know if that is contradictory or not.

I recall during the MP pension debate there was some discussion which made all the national news. A very prominent Reform member indicated that the salaries of MPs should be doubled. If we add up the costs I can assure the House it would cost a lot more than what is in place right now. I know I am telling the truth because I can see their blood pressures rising. One member is about to fall out of his chair.

With respect to the budget that was touted before, I recall the Reform Party numbers did not add up. I looked through all the newspapers in Canada to see if one single, influential, credible person would say anything positive about that budget. I did not see one single line, not one single word.

If we look at the polls today, of course they change. They go up and down.

[Ken Epp, Reform, Elk Island, AB]

Do you know what dogs do to poles?

[Ronald J. Duhamel, Liberal, St. Boniface, MB]

Yes and I know what the Reform Party members do to polls. They look at them very carefully. It is an indication of what kind of credibility the party has.

Look at the polls since the 1993 election. They are at about 12 per cent across the country which is roughly what the Bloc Quebecois gets in Quebec only.

All that is being said today I understand and some of the people have said it with a great deal of passion. Some may even believe it, although some say it and do not believe it. Clearly there is no evidence that message is catching on. Why is it not catching on? It is exaggerated. It has no credibility. It has no basis. It does not make sense. It is just not hitting the target.

[Monte Solberg, Reform, Medicine Hat, AB]

Madam Speaker, I smell the distinct odour of Liberal arrogance across the way when the hon. member mentions polls.

I remind the hon. member to look at the recent byelections where we had his own party running scared in places where we had not even run candidates before. Let us get the record straight. That is truly the poll that really matters.

I want to touch on the issue of perks. The hon. member has touched on a bunch of trivial issues but I want to point out one thing. His pension alone would pay for all of those trips to the parliamentary dining room where four, five or six of our members may go from time to time to get a subsidized meal for a couple of dollars off. His pension would pay for any first class air fare that our members take. His pension alone would pay for any of the perks he referred to 10 times over.

I remind the member to put this into context. It is very important that Canadians understand to what lengths the government members went to protect themselves from all the cuts they were to make to everybody else well ahead of the day the budget came down. That is absolutely unbelievable but they did it and they will pay a price for it.

[Ken Epp, Reform, Elk Island, AB]

Madam Speaker, I have a considerable challenge to change the minds of hon. members in the House who have the real power in this place.

I am very annoyed on behalf of my constituents and on behalf of all Canadians that we do not in this boardroom on behalf of the country have the mechanism to defeat a budget which is bad. This is even before I am talking about this particular budget.

Let us say a party brought in a really bad budget. We will not say the Liberals did that this time, that is self-evident. Let us say it was some hypothetical party some time in the future. The thing that is wrong with this place is there is no mechanism which permits the members of Parliament as representatives of their constituents back home to actually defeat that budget.

I believe that is deplorable. It is deplorable that the member for Saskatoon-Dundurn cannot stand up here and vote against this budget if he felt he should without the fear of being disciplined and without the fear of losing that treasured privilege of being able to run a second term in order to get his high priced pension plan.

A lot of people are aware of this MP pension plan. They are also aware that the Liberals have only tinkered with it. They did nothing tangible really. Changing the age to 55 is commendable. For most Canadians there is no pension until they are 65. Furthermore, they do this at a time when they are talking about reducing the number of years ordinary Canadians can pay into their RRSPs. They are talking about it at the same time they are talking about increasing the age when Canadians will become eligible for the Canada pension plan. Yet for themselves they bring it down to age 55.

We have this new member from the Bloc here who is now 22 years old. Theoretically before this little change he could have picked up his pension at age 28 for the rest of his life. The wonderful Liberals said: "You cannot have that. You now have to wait until you are 55", while other Canadians have to wait until they are 65.

Canadians ought to know one important fact. There is a much greater price to pay for that MP pension plan than what is evident. As members probably know, I am a mathematician of sorts, although not a very high powered one. I taught high school math for four years and I taught at a technical institute for 27 years teaching mathematics and computing.

I know a little math of finance. I did some calculations. If I wanted to provide for myself the same pension I would be eligible for if I were in the MP pension plan, and I am proud to say I opted out, the cost to me at my age would be around $4,000 per month.

I am already over 55. I would be eligible right now if I had six years of service here. That is incredible, approximately $4,000 to provide me with a lifetime pension if I live to be the same age as my grandfather did. He had the same shape I do and he lived to be almost 90. Obviously I am taking that into account.

That is incredible. It means the members here who say how terrible of our member from Calgary who said we should increase the salary of the MPs are the same Liberal members who are taking the money. They are taking that money but they want to keep it a secret from the Canadian people. That is-I cannot use bad words. I do not want to get into any unparliamentary language, therefore I will stop there.

There is a lot of resistance on the governing side to actually fix the budget and to reduce government spending. It does not have to be done in social programs only. Certainly there are areas in our social spending that should be done more efficiently. There are many areas of government spending where we waste an incredible amount of money. We use around $5 billion a year to subsidize business. That is obscene when there are hundreds of people struggling to make ends meet and to pay their annual tax bills.

The government is eager to get re-elected. It is doing that by making sure the people of Canada do not have the bare facts on what it is actually doing.

I will give members opposite a little insight into what it means when one allows the debt to grow. I preface this by saying I would like to commend the Liberals. They will take this out of context. They will say the member for Elk Island said he wanted to commend the Liberals. Please listen to the end of the sentence. I want to commend them for borrowing less than probably the Conservatives would have done if we would have left them in. It is really incredible since the people chose Reform and put a lot of influence through Reform, through their own members to cut spending somewhat.

This has been done. Canadians ought to know that in the last three years of the government there has been a reduction of government spending on operations. In 1993 when we came here it cost around $120 billion a year to operate the government. That was reduced the next year to about $119 billion and the next year to about $116 billion.

We have a reduction. With the projected budget in 1996-97 there is a reduction in government spending of around $8.8 billion. If we are spending $8.8 billion less, we would expect that either we are paying down our debt because we are spending less or there should be a tax cut.

Has there been a tax cut? No. We hear a lot about no changes in tax rates. That is not entirely true. We experienced last year the increase in gas prices. There have been other changes as well.

While government operations have decreased by about 7 per cent, interest payments have gone up in that same period by almost 30 per cent. That is something Canadians ought to know. Members on the government side ought to know that.

When they see that, there should be a greater sense of urgency on balancing the budget and getting the deficit not to 3 per cent or 2 per cent of gross domestic product, not continuously adding to the debt, but getting the deficit to zero, getting the Government of Canada to spend no more in total than it is taking in. The reason is that interest is eating this up because in the same time interval total government revenues have increased by approximately 17 per cent. That means the government has taken that money out of the economy and spent 7 per cent less, but interest has increased by approximately 30 per cent.

Those are the facts. I have taken them right out of the budget book which the minister presented in the House. I have done a bit of work with my calculator on those numbers.

That should cause these members to ask whether they are really representing their constituents, their children, their grandchildren and future generations by loading on to them an additional debt.

As I approach the end of my time I would like to talk a bit about amortization. Again I have made a few computations based on paying off a mortgage.

Canada has a huge mortgage. In 1993 when the Liberals took over the mortgage was around $508 billion. If at that time we had had a balanced budget what kind of a surplus would we have needed to pay off the debt in 25 years? We would have needed an annual surplus of some $48 billion if we ever hoped to pay off the debt.

Some people say it does not matter if we pay it off. I am sorry, but every individual who has bought Canada savings bonds, government T-bills or any of the other items wants to get their money back. That debt has to be paid, whether it is to foreign lenders or to Canadians. We have to pay it back. Every year we delay the price goes up.

After we reach $603 billion, which will happen after this budget year, the annual budget surplus required to pay off the debt in 25 years will have grown to $56.5 billion annually, an increase of some $8.8 billion per year for 25 years. All we have done is waited for three years.

I am with these members. I look at the people of Canada who have needs. We are a country rich in resources. We are friendly and compassionate. No one in Canada will starve to death, not if I can help it. However, I am not sure the way to arrange our affairs is to sink our children into an enormous debt. Anyone who knows anything about the magic of compound interest will realize we are getting into an increasingly difficult debt hole.

I am not content to be in a Parliament which, in this term of office, has increased the debt of Canadians by approximately $8 billion annually. That is not acceptable; $100 billion dollars more debt.

[Morris Bodnar, Liberal, Parliamentary Secretary to Minister of Industry]

Madam Speaker, I heard the figures being thrown around by a person who professes to have some knowledge of mathematics. I am surprised by the document the Reform Party put out, the taxpayers budget.

I simply refer to the last page of that document, the summary. It shows total program spending cuts of $25 billion. With a deficit of $42 billion created by the Conservative government, Reform would cut $25 billion over a three year period, $8 billion per year. Cuts of $8 billion per year would put it in a worse position than the present targets of the finance minister.

This is nothing but a document of deception put out by the Reform Party. Twenty-five billion over three years is $8 billion per year. Eight billion from forty-two means it would be running a deficit of $34 billion a year and it would be happy with it. It is not happy with what the government is doing but it is happy with $34 billion a year.

Reform is critical of what the finance minister is doing. Perhaps it should get a calculator that works. It should be a Liberal calculator because it is obvious the Reform calculator does not have any batteries.