Madam Speaker, I am pleased to rise on Bill C-31, a bill recently introduced by the Minister of Finance, which not only implements several budgetary provisions but also adds to the provisions of the latest budget brought down by the Minister of Finance some elements of the agreement on the GST reached the day before yesterday between the Minister of Finance of Canada and three of the four maritime provinces.
My argument will focus on two major aspects of the bill: first, the part dealing with certain provisions of the Unemployment Insurance Act and, second, certain provisions of the agreement on the GST, and those calling for the outrageous amount of $961 million to be paid out in compensation to the maritime provinces.
But before I go on, I must say that I deplore the fact that the government does not like to be told the truth, to hear certain facts about the unemployment insurance system, the GST or the outrageous agreement entered into with the maritime provinces. Instead of responding to these statements and debating the issues in public, in front of the people, the government chooses to hide behind a wall of silence, stifling debate with a gag order not once but twice today. This is a shame and a disgrace.
Regarding the unemployment insurance system, I would like to start by commending my colleagues, particularly the hon. member for Mercier, the hon. member for Kamouraska-Rivière-du-Loup, the hon. member for Lévis, and all those who have supported them in literally besieging the human resources development committee, whose members were once again trying to limit debate, something we will not abide. The real issues must be raised. I congratulate my colleagues on doing just that and we will keep on fighting with their support.
Our position on unemployment insurance is clear and, regardless of the gag put on us and the government's attitude in trying to hide the truth from the people who elected it, we will press on. The only thing that this bill is good for is to be tossed out. This is the only way the unemployment insurance system can be properly reformed today.
Let me restate our main reasons for opposing this reform. First, the proposed reform is unfair, because it will be harder to qualify and two categories of unemployed will be created, depending on how frequently they are unemployed. Second, this is a regressive reform, because there will be a single rate of contribution and the maximum insurance earnings will be reduced to $39,000.
Third, by lowering the maximimum to $39,000, the Liberal Party of Canada is doing a favour to large corporations, since those that can afford to pay insurable gains totalling $39,000 annually are precisely the big corporations that contribute to the Liberal Party's coffers.
Fourth, the reform is detrimental to job creation, since the new contributions structure favours capital intensive industries, at the expense of labour intensive industries.
Fifth, the reform will generate poverty, because it lowers the rate of benefits while taxing workers from the very first hour of work.
This debate on Bill C-31 gives me an opportunity to reiterate the position of the Bloc Quebecois regarding this issue. The proposed unemployment insurance reform is not agreeable to Quebecers and Canadians as a whole. The government must withdraw its bill and start the whole exercise all over, do some real thinking, and come up with a real unemployment insurance program that will help the poor in our society, instead of hitting them hard with cruel measures.
As regards the GST, there are many things we could say and repeat to the Minister of Finance. There are many things we could say and repeat to the Prime Minister, now and then. There are many things we could say and repeat to all government members regarding the numerous promises they made concerning this tax.
Why did the government, this morning, limit to only one day, or 100 minutes for the official opposition, the debate on the new agreement reached between the maritime provinces and the federal government concerning the GST? Why did it do that? I will tell you why. It is because this government is ashamed of the Liberal Party's promises that have not been kept. This government is ashamed of the attitude of its Prime Minister, who reneges on his commitments. This government is ashamed of the attitude of the Deputy Prime Minister, who said she would resign if the GST was not abolished. We are being gagged because the Prime Minister failed to meet his commitments. This is why.
Not that long ago, the government made very clear statements. We have recordings, newspaper articles and even videos of that, just as in the case of the numerous scandals involving the Department of National Defence. Prominent members of this government have made a formal commitment to Quebecers and Canadians, especially during the election campaign. They have made a promise. This Prime Minister stated in a CBC interview in 1993: "We will scrap the GST".
What is the Prime Minister saying now? He keeps repeating we should read the red book. But what did he say personally? He indulged in petty politics by promising Quebecers and Canadians that he would eliminate the GST. We have his commitment on tape. It was recorded. And that has nothing to do with the red book. He promised that he would kill the GST. And what is he doing now? He is breaking his promise.
On October 18, 1993, on the CBC, the Deputy Prime Minister made a statement that is just fine when you want to entice voters during an election campaign:
"I have already said personally and very directly that if the GST is not abolished I will resign".
So, she promised to resign if the GST was not eliminated.
What is she doing now? She is laughing at us. She is laughing at Quebecers and Canadians with her broken promises. Shame on her. We would have thought that, as it was said during an election campaign, they would stop saying they would if they did not really mean it. But that was not to be. On May 2, 1994, about six months after coming to power, the Prime Minister repeated: "We hate this tax, and we are going to eliminate it".
How can they take such an attitude now? How can they try to hide behind an agreement with the maritimes, an agreement that not only leaves the GST in place throughout Canada, but also buries it in the price?
How did we get from a formal commitment to some kind of political hybrid that makes the Minister of Finance look good and gives the Prime Minister the opportunity to say: "Look, we have done something about the GST", when what he promised was not to do something about the GST, but to scrap it? How can a government deceive the voters this way? It is unacceptable. It is so totally unacceptable that there is a general outcry in Quebec and in Canada.
About the hidden tax, for instance, let me remind the House that, as early as 1994, the Canadian Chamber of Commerce made a survey and concluded that 70 per cent of its members were opposed to a sales tax, the new GST or any new value added tax, being hidden in the price of goods. Seventy per cent of its members were against such a measure in 1994. The Canadian Chamber of Commerce carried out another survey not so long ago, last February in fact, and realized not only that the situation had not reversed, but, quite the opposite. There are now 76 per cent of Canadian businesses that are opposed to the new GST being hidden in the price of goods.
When there is almost unanimous consent within the Chamber of Commerce on this issue, why should the government come up with such a hypocritical initiative? The Canadian Taxpayers' Association, through its president, also reacted strongly against a hidden GST. Why? First, because it allows the government to conceal what the real financial situation is in Canada. It also allows the federal government to conceal its mismanagement of public funds and the fact that it is standing on the brink of a financial abyss, with an accumulated debt of over $550 billion. That is the first reason.
The second reason is that by hiding the tax-as the Minister of Finance has done in the agreement reached with the three maritime provinces and which he would like to extend to the rest of Canada-the government has found a roundabout way to increase the tax, year after year, without the consumers in Quebec and the rest of Canada knowing about it.
In fact, while in opposition, the Liberals vigorously attacked the previous government on the GST and emphasized the very same things we just mentioned. In 1989, the Liberal opposition minority report said: "Moreover, if the GST is hidden in the sales price, it will be a lot easier for the government to raise it later". This is what was said in the Liberal minority report of 1989. It also said: "Nothing will prevent the government from regularly raising the GST." This is still according to the 1989 Liberal minority report.
This is what the Liberal Party was saying then. I find it peculiar that they should do a complete turnaround a few years down the road. How can the people of Quebec and Canada trust a government like that?
As such, the agreement is a bad deal. Why? Because not only is the problem of the hated GST not solved, not only is this tax hidden and there is no national reform, since this is restricted to the maritimes only, but this will cost Quebecers and Canadians outside the maritimes at least $961 million over the next four years to compensate the maritime provinces for the revenue loss they will experience after replacing the actual federal and provincial taxes-totalling some 19 per cent in the maritimes-by a single federal tax of 15 per cent.
This is a $961 million political compensation that has nothing to do with federal compensations like, for example, the one that followed the abolition of the Crow's Nest rate for the transportation of western grain. They said then that economic distortions were created.
These economic distortions are being eliminated, but there must be compensation for those who, since 1897, benefited from this preferential transportation rate. That is not the same thing. That was an economic compensation. This compensation is political. We are supposed to believe that the government is doing something about the GST, that it wants to harmonize the consumer tax collected by the federal government and the provinces, when in reality this accord is a smokescreen for a broken promise and an outrageous expenditure of $961 million over the next four years.
This is a lot to pay so that the Liberal government can pull the wool over our eyes, to the tune of almost $1 billion over the next four years. This is not right.
Not only that, but the finance minister is keeping something else from us about this agreement, and that is that in four years, when the $961 million have been paid, equalization payments will kick in. It is not just $961 million. After the fourth year, we will continue to pay, on average, approximately $250 million annually to the maritimes for this bad deal, this political deal that the finance minister signed this week.
The new deal between the federal government and the maritimes will cost $1 billion to Quebecers and Canadians outside the maritimes. It is a high price to pay for Canadians for a bad deal, a political deal, which maintains the GST.
It is not the only price. After four years Canadians will continue to pay compensation to the maritimes by equalization payments. When one reduces the taxation base, as in the proposal of the Minister of Finance, equalization increases automatically.
In Quebec we realized harmonization for five years without any cost to the federal government, without any cost to Canadians in other parts of Canada. Why is it not possible for the Liberal government to do the same thing in all territories of Canada? Why is it not possible to avoid paying $1 billion to the maritimes?
Not only is this agreement costing us dearly, not only does it solve nothing, not only is it a smokescreen for the Liberal Party's broken promises, but in addition there is a danger that it will set a precedent of interfering in the fiscal autonomy of the provinces.
I would like to tell you what the deputy premier of Quebec said when he heard about this agreement, because there are fears in Quebec about the agreement. He said, and I quote: "Certain conditions cannot be gotten around, including full fiscal autonomy for Quebec, which must retain full flexibility to set the base and the rate".
His concerns are not without foundation, because in the paper tabled Monday at the same time as the agreement, it is clearly mentioned that the new Canada revenue commission, the one which was announced in the speech from the throne and which came up again in the last budget speech, will be responsible, in place of the provinces, for managing the new tax, the Liberal government's new hidden and hypocritical GST.
As this paper points out, if application of this agreement between the federal government and the maritime provinces is to be expanded to all of Canada, over the next few months there will be many approaches made to the various provinces to get them, Quebec in particular, to give up their taxation autonomy, administration of the sales tax, the right to set the level of their own taxes-something Quebec is totally free to do today-and particularly the right to determine which goods and services are to be taxed. This is what lies hidden behind the agreement reached between the maritime provinces and the Minister of Finance.
We can but regret this agreement, this political agreement, this bribery of the maritime provinces, aimed at getting what the Minister of Finance and the Prime Minister want. We can but regret, as well, what occurred here yesterday at 5.21 p.m. Since I saw it as a tragic moment for Canadian parliamentary history, I took note of the exact time the Minister of Industry tabled a notice of motion to gag us in the debate on Bill C-31, as well as on the outrageous agreement between him and the maritime provinces.
This agreement will be terribly costly for us. A minimum of $1 billion over the next four years, $250 million from the tax dollars of Quebecers to foot the bill for a political agreement entered into with the maritimes. This agreement will serve to increase competition between Quebec businesses and those in other provinces, New Brunswick, for example.
Such a situation is not right, particularly since we in Quebec have come to an agreement with the federal government, have made an incredible effort to harmonize the tax, have defined highly efficient mechanisms for its application and administration, and now are rewarded for our efforts by the federal government's presenting us with an agreement that has been thrown together, a political agreement that will cost Quebec $250 million, and the rest of Canada some $750 million.
I can understand why Quebec is starting to rise up, and the other provinces as well. It is not right for a federation to be administered the way the federal government is administering this one. Nor it is right for it to renege on its commitments, as the Prime Minister and the Minister of Finance are doing.