Mr. Speaker, I too am pleased to speak on the budget. Yesterday afternoon, the people of Canada and Quebec were sorely disappointed with this federal budget, who purpose is to win votes. It is not only a do-nothing and meek budget, but also one that falls short of their expectations, given the considerable flexibility the government and its Minister of Finance had in preparing this budget.
Like the vast majority of people and pressure groups, the Bloc Quebecois condemns this cheap election-minded budget designed to disguise this Liberal government's lack of action while purporting to provide assistance to children, families and the unemployed in Canada and Quebec.
Like in the cartoon published in Le Devoir this morning, the Minister of Finance of Canada is bragging, with cynicism to boot, in the face of all the people who were hit by the massive cuts of the past three years. This cartoon illustrates the attitude with which the finance minister tabled this budget. Such an attitude is an insult to the 1.5 million unemployed in Canada today. It is an insult also to the tens of thousands of children who have been forced to live in poverty by this government since it took office. In fact, the number of poor children has increased by 500,000 over the past three years.
This attitude is also an insult to provincial governments, which have had to pay the price for reduced transfer payments and to live with the consequences of this government's policies for the past three years. Finally, the most insulting aspect of this attitude is that, in addition to showing off, the Minister of Finance is displaying a terrible lack of initiative in his election minded budget.
Two general conclusions can be drawn from yesterday's budget. The first one is that, since it was tabled last night, this budget has generated a unanimous reaction in Canada and in Quebec, as we saw this morning in most newspapers. There is an obvious lack of faith in the proposed measures, in light of the previous policies of this government over the last three years, since it took office.
This lack of faith affects Canadians and Quebecers, because the finance minister paints a misleading picture on the reduction of the deficit, which he says is the result of the government's cost cutting measures, but which is in fact largely due to a reduction in transfer payments to the provinces.
There is also a lack of faith when the finance minister proposes a timid reduction of employment insurance premiums, whose rate is well above the rate that the government and the minister could have set. Instead of granting a 10 cent reduction, the minister could easily have lowered the rate by 30 cents, as we will see later.
There is also a lack of faith when the finance minister announces that $800 million will be earmarked for the creation of the Canada Foundation for Innovation. That money will come from the savings made through reduced transfer payments to the provinces. In fact, it is the provinces that will pay for this investment.
Let us look at the reduction of the deficit, which the finance minister is so proud of. The minister is very cynical when he boasts about the early success of his fight against the deficit.
Yesterday, he said, and I quote: "For 1998-99, the government's deficit target is $9 billion". The minister is therefore talking about a partial deficit, without ever setting a deadline for a zero deficit in his budget, as several provinces did, including Quebec.
We all know that the finance minister refuses to give a date, at least for the time being. The minister, who is driven by fear, is probably waiting for the next election campaign, which is not too far away. He will then engage in grandstanding in setting a deadline for his zero deficit, because he will have given himself enough flexibility to set a date depending on the circumstances.
This timid attitude, to say the least, goes against the very idea of a long term budgetary plan, and illustrates the essentially demagogic nature of the budget tabled yesterday by the finance minister. However, this lack of rigour on the government's part is not the real issue. The real issue is the source of the funds used to fight the deficit, something which the minister is so proud of.
It was precisely this that the Minister of Finance touched on yesterday when he said, and I quote: "The fact is that by 1998-99, government spending on everything but the debt will have been reduced from $120 billion in 1993-94 to $103.5 billion".
Once again, we must put these statements by the minister in context. Yes, spending has been reduced, but how? Now we know that it has been almost entirely by offloading the deficit onto the backs of the provinces. This reduced federal spending is largely an illusion.
Let us return to a major sticking point in yesterday's budget: the reduced EI premiums. As we have said repeatedly, these premiums are well beyond the objectives that could have been reached in order to demonstrate leadership in this area, and that could have been an effective job creation measure.
Let us also return to the creation of the Canadian Foundation for Innovation. Once again, this is a measure that owes its existence to money taken from savings generated through decreases in provincial transfer payments.
A second thing we notice in examining this budget is the sly interference of the federal government in matters of provincial jurisdiction. An examination of measures over the last three years reveals three areas where the government has shown a lack of good faith.
First, the piecemeal approach when it comes to the promises regarding benefits for children living in poverty: $70 million seems completely ridiculous, if you consider the role of this government in contributing to child poverty, which has done nothing but get worse since this government came to power.
I would like to quote a brief passage from the Liberals' red book, which reads as follows, on page 15:
Today, after nine years of Conservative government, Canadians are facing hardship: 1.6 million unemployed, millions more on welfare, a million children living below the poverty line, record numbers of bankruptcies and bank closings.
Here is another quote taken from real life, straight from Statistics Canada: "After three years under the Liberals, the country is still in a sorry state: 1.5 million Canadians are unemployed, nearly 3 million are on welfare, 1.5 million children live in poverty, 500,000 more than three years ago, and the number of bankruptcies, 86,253 between January and November 1996, has also reached record levels". We understand perfectly why before he resigned from the Liberal Party, our colleague from York South-Weston said: "We accused Conservatives of every possible evil, and I am resigning because we are doing exactly the same thing they did". People had certain expectations with respect to child poverty.
How can we believe this government if we consider it failed to inject $720 million in child care, a promise that was not kept, like the GST?
Second, more band-aid solutions, when we consider promises in other areas that are strictly matters of provincial jurisdiction. This is an amazing attitude on the part of the Minister of Finance. He savagely cuts transfer payments to the provinces, which undermines provincial objectives to fight poverty and unemployment, and meanwhile he is interfering in provincial jurisdictions with his pre-electoral gestures. We know perfectly well the government cut $4.5 billion in transfer payments to the provinces which are used for social programs. It also took $5 billion out of the unemployment insurance fund, which in the end comes out of the pockets of Canadians.
What is going on? The problem is that the unemployed are receiving fewer benefits that are becoming increasingly difficult to obtain and are getting them for a shorter period of time. Thousands of people will never have unemployment insurance, even if they did work. So today, they tend to end up on welfare much faster. Transfers to the provinces for social assistance have been cut.
When the government says it is doing something about poverty, it is just putting a band-aid on a problem the government itself created and which has not changed from what it was three years ago, when the Conservatives were loudly condemned by this government.
Finally, as you saw earlier during question period, no commitment was made or will be made in this budget to compensate Quebec for the cost of harmonizing the GST, a demand that has been voiced repeatedly for a number of weeks, especially by the Quebec Minister of Finance.
We know the government has just transferred $1 billion to the maritimes, and as my colleague from Longueuil explained earlier, when you transfer $1 billion from the federal government to the governments of the maritimes, this is $250 million which comes out of the pockets of Quebecers, since Quebecers provide Ottawa with one quarter of its revenue. So they took $250 million out of the pockets of Quebecers to send it to the maritimes, because they were harmonizing their provincial sales taxes with the GST. Quebec has claimed compensation for nearly $2 billion and will not get a penny. That is the story of the GST.
This budget is an electoral budget but it is also a lousy budget. The minister of finance did a lousy job on this budget. The minister had every opportunity to do something. He had a margin in which to manoeuvre; in fact $8 billion under the targeted deficit if we include in the $5 billion the $3 billion that was set aside for bad eventualities.
The Bloc Quebecois produced three reports recently, trying to show the government through an analysis of the fiscality that it would be perfectly possible through the fiscality, through the underground economy and by implementing some measures suggested by the auditor general to get $6 billion more.
It is possible to get a $14 billion margin. It is a real possibility. With this margin we should have expected the minister to do something. It would have been quite possible to still target zero deficit for the year 2000 but at the same time to give back to the provinces the $4.5 billion taken for social programs and to put back into the unemployment insurance fund the $5 billions taken from there to give more protection to the unemployed and maybe to use a 30 cent reduction on fees instead of 10 cents. But that is not what the minister has done.
Of course, this budget is an electoral budget, we all know it. We are going into an election, as everybody seems to understand. The election will be a very strange one in comparison with the one of 1993. In 1993, 54 members of the Bloc were elected from Quebec and, to the surprise of all Canadians and to our own surprise, we became the official opposition here.
This time there will not be any surprise. We will very easily elect 55 members of the Bloc back into the House of Commons. It is now possible for Canadians to replace the Bloc as the opposition, if they so wish, if they think we did not do a good job as opposition, by electing an opposition from another party. If they do not, we have to admit that we will be elected as the official opposition not only by Quebecers but by all Canadians.
In conclusion, this budget needs to be seen as what it is: a vote-seeking budget, a do-nothing budget which does not come up to expectations, and for what it is absolutely not: a tax-reforming budget.
We know, Canadians and Quebecers know, that the rich in this country do not pay as much tax as they should. The minister has been urged repeatedly to really reform the Canadian tax system, but there is nothing in this regard in the budget.
To give a precise example, the family trusts, we know that they all beat it for the U.S. not so long ago, and got out of paying an amount estimated at between $500 and $600 million in taxes. Six hundred million dollars is exactly what will be given to poor children over the next two, three or four years. Two companies belonging to the same group left without paying taxes, and the government did not react.
Nor are there any job creation measures. Jobs, jobs, jobs, if anyone can find any, let them tell us where. There will be no hope for Canadians or Quebecers with this budget as far as job creation is concerned. All that the minister and the Prime Minister say is that it is up to the market to create jobs, and we must set up the necessary conditions for jobs to be created.
We need look no further than the banks, which have made record profits in the past two years, but are now responsible for record layoffs as well. Before telling us that private companies create jobs, maybe a thorough analysis ought to be done.
There is nothing about the GST and Quebec. Where is the fairness here? There is a double standard; the maritimes get money, Quebec does not. And they will go on cutting benefits to the unemployed and cutting social programs, while the minister is madly patting himself on the back, claiming he has managed to fight the deficit with his budget.
We are heading toward an election, and the Liberals will be judged accordingly.