Madam Speaker, I will be sharing my time with the hon. distinguished member for Burin-St. George's.
It is a distinct pleasure for me to participate in this debate with regard to this budget. I would like to congratulate the government, the Minister of Finance and of course the whole Liberal caucus. I want to single out the Parliamentary Secretary to the Minister of Finance, the hon. member for St. Paul's, who is my seatmate. He has done a tremendous amount of work in the preparation of this budget and of course lining up the debate which is going on the House right now. I congratulate him. I am sorry that he has decided not to run in the next election and I wish him well as he goes down the road and continues his work as a great Canadian.
Our teamwork has resulted in a budget that will benefit not only the people of my riding of Hillsborough but all Canadians. Since the minister made his speech we have heard a lot of commentary. Some special interest groups say it is not enough, other groups say that it is too much but, more important, we have heard from a few Canadians who, I believe, represent most of the people who say it is just right.
I am one of those people. I am one of the many in this House and I am one of the millions of Canadians across the country who agree that the government as a whole has done the right thing. I agree with the budget approach, the extent of the measures and I agree with the timing of these measures. I would like to elaborate by explaining why my opinions are so positive toward this budget.
When we entered office in the fall of 1993 the federal government was deep in debt and it was falling ever deeper very rapidly. After just four budgets we can now see the light at the end of the tunnel. The deficit has been reduced by over half, a reduction of $23 billion, and if we look at the cumulative effect of those cuts we have lowered the net debt by $89 billion from what it otherwise would have been. For this we and all Canadians have been rewarded by the financial markets with lower interest rates.
We have heard many calls for cuts to payroll taxes, income taxes, sales taxes and every other tax that has been the flavour of the day. I would like to provide my hon. colleagues in the House examples of what our actions have meant to Canadians.
First, let us assume that you, Madam Speaker, have a $100,000 mortgage which is to be amortized over 25 years. If we compare the rates that were available in January 1995 and the rates available right now, by refinancing you could save roughly $230 a month on a five-year mortgage. Instead, if you took a one-year mortgage you could save over $300 a month. That is a lot of money.
But there is more. Let us assume that a small business person started a business and took out a $1 million loan amortized over 10 years. If we compare the interest rates that were available in April 1995 with the interests rates that are available now, by refinancing that loan, that person could save $33,000 annually.
If I went out tomorrow to buy a car and I borrowed $15,000 and amortized it over four years I would save $480 a year because of the lower interest rates.
These examples are not fiction. These are examples in the real lives of real Canadians. I have people in my riding, as I am sure in other ridings as well, who will save thousands of dollars because of our actions which have resulted in these lower interest rates.
To make my point even clearer, perhaps we should compare a cut in payroll deductions with one of the examples I have just given. What would happen if a payroll deduction was cut 25 cents per $100 in earnings? We have heard calls for this in the House and across the country. The Canadian who makes $39,000 a year would save, now hold on to your hats, a whopping $97.50 per year, not per month but per year. What is more, this meagre cut would cost the government $1.8 billion. Lower interest rates save money, not cost the government money.
Given the choice of a payroll deduction cut of $100 a year or interest savings of $480 on a consumer loan or $2,000 to $3,000 on a mortgage, what would members choose? I know what I would choose and let me tell the House it would be worth more than $100.
I would like to put the budget into perspective. The deficit is still falling. We are doing well on that front, so well in fact that the government was able to invest in health care as recommended by the National Forum on Health. It was able to invest in education by assisting students and their parents. It was able to relieve some of the burden on low income Canadians, and it was able to provide assistance to Canadians with disabilities as suggested by the federal task force on disability issues.
All this goes hand in hand with recent announcements and other budget items such as the funding for the extension to the community action plan for children and the Canadian prenatal nutrition plan. I applaud these extensions. I and my constituents are happy to see these important programs being maintained.
The government chose the right path. It chose a balanced approach by staying the course while providing some relief to Canadians. It has been a hard fight for everybody, but we must continue to reduce the deficit if we are ever going to be able to achieve our goals.
One of our primary goals is job creation. A lot of attention has been given to small business. Yet again, there are initiatives in the budget that benefit small business.
The Canadian Tourism Commission is a partnership of both the private and public sectors which designs and implements effective marketing strategies and programs to increase tourism revenues in Canada. The commission also provides services to the tourism industry to help it remain internationally competitive.
Tourism is a large part of the local economy in my riding, indeed in my province. The increase in funding to the CTC will boost the promotion abroad of Canada and thus boost our tourist industry on Prince Edward Island. This is particularly important to us now that the Confederation Bridge is opening in just a couple of months. Islanders are expecting a million tourists this year. This is a jump of some 200,000 tourists over last year, the largest factor for the increase of course is the bridge. This is twofold.
First the bridge will alleviate many of the travel problems associated with the ferry service. Second, the bridge is more than just mode of transportation. The bridge itself will be a tourist attraction because Confederation Bridge is the largest of its kind. When it was built a special crane had to be brought in, a 9,000 ton crane, to install the 8,200 ton girders. In fact, tours were given throughout construction just to see this operation.
Another boost to the tourism industry is the additional funding to the Business Development Bank of Canada. The $50 million will translate into $250 million in loans to small business and tourism. This means more opportunities for Islanders and for all Canadians. This increase in tourism will not only enhance the peak summer season in Prince Edward Island and Atlantic Canada, but it will also strengthen the shoulder season periods of spring and fall.
This will mean jobs. More help will be needed during the peak season and the shoulder seasons and that will mean more hours. In short, more people will stay on the job longer.
Boosting the tourism industry is good but what Islanders also need are full time, year round jobs. To assist in that area, the government is investing upfront $800 million in the new Canada Foundation for Innovation. This foundation will help strengthen the research and development infrastructure at universities, colleges, research hospitals and not for profit research institutions and organizations in the area of health, environment, science and engineering.
I have both a university and a college in my riding. These two institutions are eligible for financial support from the foundation to modernize their research infrastructure. The foundation will be an arm's length organization. It will seek partnerships to support these investments. Together with their partners, it will be able to fund up to $2 billion in infrastructure improvements.
I am sure that all hon. members are interested to hear what the president of the University of Prince Edward Island had to say about the foundation. Dr. Elizabeth Epperly said: "It sounds wonderful and you can be certain that we will take advantage of it". Those are words of encouragement from a key player in the field.
In fact, innovation is becoming increasingly important for international competitiveness and that is even more important in an open country like Canada. In light of this, the government continues to make every effort to improve competitiveness.
I am pleased with the budget. I know Canadians are pleased with it. It shows that the hard work that we have done over the last three years is paying off. I encourage all people in this House to support it.