House of Commons Hansard #146 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was budget.

Topics

The BudgetGovernment Orders

4:50 p.m.

The Acting Speaker (Mr. Milliken)

I see a quorum.

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4:50 p.m.

Reform

Ian McClelland Reform Edmonton Southwest, AB

Mr. Speaker, it is a real pleasure to participate in this extremely important debate.

Being a budget debate, it gives us the opportunity to have a fairly wide ranging discourse about the affairs of the country. It gave me an opportunity in preparation for this discourse to consider some of the reasons that brought me into politics in the first place.

I am sure that my reasons were really not very much different than the reasons of my colleagues opposite or those with whom I share this side of the floor. Most of us are here because we want to make our country and perhaps even in a greater sense the world a better place for our children and for our grandchildren.

My motives are not necessarily any more pure or pristine than the motives of my colleague opposite. It is clear that I would prefer that we addressed our problems in a much more forthright manner than members opposite.

I am reminded of the words of Ayn Rand. These words help me very much in my life and I have tried to share them with people

whenever I can: "You must deal with problems as they are, not as you would wish them to be".

It seems to me that all too often we in politics tend to deal with problems not as they are but as we wish them to be or, worse, given a particular situation, we will try however we must to justify the status quo. If we have made a mistake, rather than fix the mistake we will somehow try to make it right without addressing the core problems.

In politics, the higher a person is on the food chain, the less likely it is that any utterings of that person will be seriously challenged by anyone in this place.

In "The Rights of Man" Thomas Paine wrote that each generation has the right and the responsibility to govern for its times. The greatest insolence and tyranny of all is the presumption of ruling from beyond the grave.

Particularly to young Canadians who might be watching this debate, how does this enter into the budget debate? What do the words of Thomas Paine have to do with our budget debate over 100 years later? Why are his words germane?

They are germane today just as they were then for this reason. If we in our generation and in the generation that preceded us saddle our children and our grandchildren and their children with a debt that is not of their making, then we are ruling from beyond the grave. When we are no longer of this world, what we have done will be paid for by our children and by our grandchildren.

I am sure I speak for many parliamentarians here and in provincial legislatures across the land. When I wrestle with the problems that we have of debt, we must do so bearing in mind that we have a sacred obligation to future generations to leave our country and our world in better shape than we found it in.

That is what brought me into politics and I would expect that is what brought a lot of my colleagues into politics. Some of us choose to achieve these goals by different avenues. That does not make them necessarily right or necessarily wrong. However, it does suggest that there are different priorities attached by different political parties.

The Liberals came into this thinking that if we are able to change the name and move things around a little and fudge it we will not really have to address the core problems facing our country. The core problem facing our country has not been revenue. Being the most highly taxed of the G-7 countries, of any industrialized nation in the world, revenues are not a problem. As a matter of fact, in the government's revenue documents, the budget documents, it clearly makes the point that government revenues are going to increase from the 1994-95 fiscal year to the 1998-99 fiscal year by $20 billion.

That is virtually the entire growth of the gross domestic product of the country. What is happening is that the lifeblood of the country is being sucked out of the pockets of individual Canadians. We do not have a revenue problem, we have a spending problem.

Over the same period of time again from the government's own documents it shows that government spending will decrease $15 billion but fully $7.5 billion of that government spending decrease will be part of the Canada health and social transfer.

So then what are the components of the Canada health and social transfer? They are transfers to the provinces with respect to payments for health, post-secondary education and welfare. Where are the provinces under most stress in their budgets? Health, post-secondary education and welfare.

The federal government has changed the name of the departments, combined them into a global budget and then said it will reduce transfers by $7.5 billion. That $7.5 billion represents a decrease from $19.3 billion to $11.8 billion.

I do not know what the percentage is and I apologize, I should have figured it out, but it is pretty dramatic. The provincial governments have had to make up and take up the slack.

It is a little difficult for the provincial governments to do so because in order to be eligible for the transfers from the federal government for these programs the provincial governments must abide by rules established by the federal government.

Here we have the situation where the federal government is making the rules but the provincial governments have to pay for it. It does not seem right to me. It does not seem right to me not that the government does not have the responsibility to get its finances in order but how can it in good faith and good conscience slough off the responsibilities to other governments and call this doing the job?

At the same time that the government is reducing transfers to the provinces in support of health, education and welfare it has all kinds of resources to subsidize business such as Bombardier, such as a hotel in the Prime Minister's riding for millions of dollars, to business all over the country with the notable exception of the west. How can we find money to subsidize business but we cannot find money to transfer to the provinces for health, post-secondary education and welfare?

It seems to me that the government is speaking out of both sides of its mouth when it says that its concern is for post-secondary education, understanding that the future of young Canadians is built on knowledge and at the same time it cuts transfers to post-secondary education.

I invite my colleagues opposite to stand and perhaps we will have an opportunity to explore some of these issues.

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5 p.m.

Liberal

John Bryden Liberal Hamilton—Wentworth, ON

Mr. Speaker, I am delighted to stand and reply to my hon. colleague whose remarks were very well taken.

However, I would like to react to his observation that because the federal government is cutting transfers to the provinces for health and education it is irresponsible.

He correctly points out that we certainly are trying to stimulate business. On the one hand, by stimulating businesses we create energy in the economy. Businesses, for profit industries, do make money and they are self-controlling to a certain extent in that they are accountable to their shareholders. By stimulating small and medium size businesses we do much good for the economy.

The problem with the health and educational sector is that they are industries which are entirely not for profit. The difficulty is that at both the provincial and the federal level, and I think my colleague will agree, there has been a lack of scrutiny and demand for efficiencies that perhaps there should have been, particularly through the late 1970s and early 1980s.

As I see it, the problem is that when the federal government is giving transfers to the organizations which are under provincial control, it realizes that there are enormous efficiencies, perhaps operating at about one third of their maximum efficiency. What is the choice if we are going to bring efficiencies to this sector but to cut the transfers from the federal government to the provincial governments? How else can we encourage the provincial governments which actually control these sectors to demand better accountability and better efficiencies?

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5 p.m.

Reform

Ian McClelland Reform Edmonton Southwest, AB

Mr. Speaker, my colleague opposite makes a good point. The problem is that the federal government is the one that sets the standards. The federal government is the order of government which built the expectations in the population of Canada. Provincial governments are responsible for delivering the programs for which expectations were determined by the federal government. When there is one order of government responsible for raising the money and the other order of government responsible for delivering the programs, there will automatically be situations where people are pointing fingers, one at the other, saying it is your responsibility.

It seems to me that whoever raises the money and pays the bulk of the money should be setting the standards.

My colleague opposite also pointed out that businesses create wealth. I do not have any problem with that. However, it seems to me that it would be far more efficient to provide for entrepreneurs to make a profit and retain it and get a capital pool for their investment. When any order of government uses taxpayer money to subsidize another business, it is artificially stimulating or changing the business environment in a particular area. The reason businesses take up government programs is they are there. If one business makes use of a government program and another does not, then the business that takes the government largess has an advantage. It does not create employment, it just creates more and more taxation.

I raise the example of someone working for $7 or $8 an hour and paying taxes to the federal government. That money working its way back into the business environment, subsidizing someone else to go into competition with the people who paid the money in the first place just plain does not make sense.

If we allowed entrepreneurs to retain a return on the investment that would create an entrepreneurial environment so that people could make more money from entrepreneurial activity rather than a passive return on investment on interest income, we would see a whole lot more entrepreneurial activity, a whole lot more job creation and it would be extremely cost effective.

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5:05 p.m.

Liberal

Andy Mitchell Liberal Parry Sound—Muskoka, ON

Mr. Speaker, I will be sharing my time with the member for Ottawa West. I am pleased to have an opportunity to rise on debate today to address the budget which the finance minister brought down in the House a few short weeks ago.

I will examine three perspectives, what this budget does for Canadians in general, what this budget does for rural Canada specifically, and what this budget does for the residents of my riding of Parry Sound-Muskoka.

This budget shows the good, strong fiscal management of Canada. That is what the Minister of Finance has provided for the last four years. That is what this government has provided. If we look at the comments in the popular press and at some of the public surveys regarding the budget, that observation is shared by a great deal of Canadians, indeed by the majority of Canadians.

What we have seen and what the Minister of Finance was able to say in that budget is that Canada will have its lowest deficit in15 years. We have managed as a government to take a deficit of about $42 billion which we inherited in 1993 and reduce it to less than $19 billion in this fiscal year.

More important was the finance minister's comment that within another fiscal year or so the federal government will no longer have to enter into new borrowings. In essence if we calculated our deficit as most other nations do we would say that we were balanced. We will no longer have to enter into the markets for new borrowing. That will be the first time in almost a generation and a half that it has happened.

Canada today is enjoying some of the lowest interest rates that it has seen in 40 years. That is a benefit and something that flows from our strong fiscal management. We are seeing the lowest sustained rate of inflation in 30 years. That is protecting the purchasing power of Canadians. It is engendering consumer confidence. It is important to point out that low inflation protects purchasing power for low income Canadians in particular.

The Minister of Finance through his budgets has been able to create an environment in which job creation has occurred. I do not think there is anybody in this House who would not want to see more of it occurring, but good progress has been made. There have been 700,000 net new jobs created in the last 41 months of this Liberal government. That is even more impressive when we compare that to the record of the last 41 months of the previous Conservative government where some 146,000 net jobs were lost. We have gone from losing about 150,000 jobs to gaining about 700,000 jobs.

This budget also saw a targeted tax reduction of about $1.9 billion. But it was not a tax reduction as we have seen suggested by the Reform Party or what we have seen done in Ontario, which was across the board which provides very little benefit to the people at the low income end while it provides substantial benefits to the high income people.

This has been a targeted tax cut that has helped specific Canadians. It has helped low income Canadians with children. That is who the tax cut has been targeted to. It has been targeted to individuals seeking post-secondary education. We have had targeted tax cuts to help Canadians with disabilities and we have had tax cuts to help charitable organizations that are at work in our communities trying to help those most in need. That is what this budget has done for Canada as a whole.

I was particularly pleased to see that the budget also addressed the needs of rural Canada and rural Canadians. Indeed, this budget began the process of fulfilling the Prime Minister's throne speech commitment of last February 1996 when he clearly said that we needed to work on the whole issue of rural development.

We saw that through a new commitment to tourism, a very important industry in rural Canada. We saw the Canadian Tourism Commission's budget increase from $50 million to $65 million. This was very important for rural Canada.

We also saw the Minister of Finance make a commitment of some $50 million to the Farm Credit Corporation. These funds are going to be used to explore and develop innovative ways to move forward the whole issue of economic development in rural Canada.

We also saw the minister make a new commitment of $30 million to the community access program which is absolutely essential for rural Canada. We in rural Canada need the on ramp to the information highway, so to speak, if we are to be competitive and compete in the world market. I was pleased to see that commitment to rural Canada. It builds on the natural resource committee's report on rural Canada which I had the opportunity to chair when we did that report. It dealt with some of the things that we needed to do for rural Canada. I applaud the minister for beginning the process of working toward the development of our economies in rural Canada.

I would like to talk for a minute about some of the things that this budget is doing specifically for the people of Parry Sound-Muskoka. For the fourth year in a row the budget does not increase personal income tax rates for the people who are living in my riding. Indeed, it does not increase it for any Canadian anywhere.

The second item depends on Mike Harris stopping his political games. We have proposed a second phase of the infrastructure program. That first phase saw investments in the riding of Parry Sound-Muskoka of some $26 million. We saw $1.7 million on tourism infrastructure which is very important. We saw a $1.3 million investment on increased fire protection for the residents of my riding. In a rural area, fire protection is on a volunteer basis and this program has provided us with some of the tools that we need to increase that protection.

We saw over $500,000 invested in our local school boards to assist with education in our riding. Once we get this program on board in Ontario, I estimate around a $9 million additional investment will be occurring. This is very important for the people of Parry Sound-Muskoka.

Again on tourism, there is a specific problem in an area like mine where tourism operators are trying to access capital to create new private tourism infrastructures, things like resorts, hotels and restaurants. It has been a real problem because that capital has not been available from our chartered banks.

The Business Development Bank of Canada, through a $50 million investment by the government, is creating a $250 million loan pool that will allow the tourism operators in rural areas like Parry Sound-Muskoka to develop rural infrastructure or tourism infrastructure that will be increasing economic activity and increasing jobs in Parry Sound-Muskoka.

There is also another change in the budget that is very important to rural Canadians and the people of Parry Sound-Muskoka and it has to do with the education tax credit. This is a credit that allows a tax deduction for folks who have to live away from home to go to school. In the urban areas there are a number of people who do go away, but in rural Canada almost 100 per cent of our young people who want to have post-secondary education have to travel to obtain it. This tax deduction, which is a 300 per cent increase over the last

two years, is going to make a substantial difference for the people of Parry Sound-Muskoka either for those who go to school or for their parents who are supporting them when they do it.

Another measure in the budget which is going to help people specifically in my riding of Parry Sound-Muskoka is our new hires program. What it means is that the small business men and women of my riding who go out and hire somebody new in 1997 are not going to have to pay any increase in their EI premiums. This is a specific measure designed to help stimulate job creation all across Canada, particularly in a riding like mine which is so dependent on the small business sector. That is an excellent program and it will be of significant benefit to an area like Parry Sound-Muskoka.

In conclusion, the budget continues to provide strong and competent fiscal management for the country. Second, it creates a climate in which jobs and economic growth can occur. Third, it addresses the needs of rural Canadians with some very specific measures which will help the people who live, work and earn their living in rural Canada. Finally, the budget and the provisions in it will help the people of Parry Sound-Muskoka.

I am proud to be part of the government. I am proud to support the Minister of Finance who has tabled this budget, his fourth, which is bringing wealth, increased economic activity and increased prosperity to our country.

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5:15 p.m.

Bloc

René Canuel Bloc Matapédia—Matane, QC

Mr. Speaker, when my colleague says that the federal government has done a great deal for people in rural areas, I wonder if he is serious. With respect to agriculture, he earlier mentioned an amount of $50 million for all of Canada. This is a very small amount for all of Canada. Just before that, they had cut transportation for farmers. We heard the president of the Dairy Farmers of Canada, Claude Rivard, say on the radio that dairy farmers will have to increase the price of milk, cheese, yoghurt and so on because of cuts. The$50 million they are now talking about does not even match what we were receiving before. It is therefore a cut, not something additional.

As for forestry, there is nothing. I warn you not to tell me this comes under provincial jurisdiction. There is no doubt about that. That is what we want, but since forestry workers pay taxes, they are entitled to a fair return as well.

I could continue for almost all areas of the rural economy. We see that, compared to towns and cities, we are the poor relations. And, to my way of thinking, the government is not giving people in rural areas their fair share.

I ask my colleague if he is happy with this budget as it affects rural areas.

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5:15 p.m.

Liberal

Andy Mitchell Liberal Parry Sound—Muskoka, ON

Mr. Speaker, I am pleased with the question from the hon. member who had an opportunity, as part of the natural resources committee, to participate in the study on rural development.

Do I believe that rural Canada has everything it needs or that it wants? Of course not. However, progress is being made. Matters are far more advanced today than they were when the government came to power.

A progression has taken place over the last three years. The member and I share the fact that we come from rural Canada. The needs of rural Canadians really were not on the national agenda when we came to this place. Rural Canada was not a topic of conversation. This government has put it on the agenda.

We saw that clearly last year in the 1996 throne speech when the Prime Minister made a commitment to rural Canada. He understood that the challenges which are faced by rural Canadians are different from those challenges faced by urban Canadians. The programming and the delivery of that programming has to be designed in a way that takes into account the unique challenges which face rural Canadians.

That process moved forward and a budget came forward from the Minister of Finance in which a number of measures were taken to assist rural Canadians. It is the beginning of a process. It is not the end. Much more needs to be done. That is why I was pleased as the chair of the natural resources committee to have an opportunity, with my colleagues from all parties, to have the national resources committee study the whole issue of rural development. We travelled from coast to coast, out west, in Ontario, in Quebec and in the maritimes and listened to Canadians from all of those regions tell us about their concerns and their needs. The report was tabled in the House last week and it discussed some of those concerns and needs.

The budget has begun the process to address them. I am confident that the government will continue in this mandate and when we have a renewed mandate to continue the process of the revitalization of rural Canada. This government is committed to rural Canadians.

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5:20 p.m.

Liberal

Marlene Catterall Liberal Ottawa West, ON

Mr. Speaker, I am proud to speak today on the budget which represents some very fundamental Liberal values and some values that are important to all Canadians.

While we have been very frugal since the election in 1993, and have had a constant eye on reducing the financial obligations of Canadians, we have also not taken our eye off those values that are

important to Canadians: compassion, caring for one another and building a better future for all of us.

The government has not had an easy time of it in recent years. Some difficult decisions have had to be made. And yet, we have considerable achievements to our credit. We have, with this budget, taken back our national sovereignty.

It is nothing less than that. We have taken back our national economic sovereignty.

We have taken back the power to decide in Canada, for Canadians, and the power to build the future that we want for ourselves and for our children.

No more do we have to look over our shoulders to Tokyo, Zurich, New York, to the international bankers on whom we had become so dependent for our bills. By next year for the first time in 28 years we will no longer have to borrow new money on the world market. This is money that up until now has been borrowed to pay year in and year out for medicare, for pensions, for education, for research, for culture.

I ask people to take themselves back to the situation we faced three and a half years ago. Of the money the Canadian government had to spend every year, more and more was going to pay the interest on the debt and less and less was available for the programs that Canadians value, to the point where we were not going to be able to afford any of those programs.

We have reversed that. We have shrunken the deficit steadily and dramatically. By 1999 we will have no deficit.

This year's budget showed just how important that achievement is. We are able again to invest in our future, modestly, yes, because we are not yet out of the woods, but in areas that are crucial.

I want to give credit to Canadians from all across the country who I believe through our caucus, our Liberal members, very much influenced and determined the priorities in the 1997-98 budget.

Just one example is the first step in a massive effort against child poverty, the most progressive social program that has been introduced since medicare. I want to particularly give credit to my own riding association in Ottawa West that first developed a child poverty resolution to go to the national Liberal convention last year and then worked along with the help of the Nepean Women's Liberal Association to make sure that at the national convention with Liberals from all across the country, children were at the top of the government's national agenda.

We have held day long forums in Ottawa West on health care, social programs and pensions. When the National Forum on Health reported last year the values of our community for accessible universal portable health care were in its report.

The budget also picks up on those recommendations and begins immediately to implement some of the recommendations of the National Forum on Health to which my constituents and Canadians contributed. It implements $300 million to try some innovative new approaches in health care. It deals with such things as a new health research fund. It doubles the money for things like the prenatal nutrition program and the community action program for the health of children.

We have money in the budget to recognize the economic equality of persons with disabilities. We have tax measures that will help compensate for the extra expense of having to cope with disabilities such as dependent care. We have a $30 million opportunities fund for Canadians with disabilities to improve their ability to be full participating citizens of our country.

There are measures for short term jobs because we know there are still many Canadians uncertain about their future, unable to keep a job, able to get only short term low skilled jobs. We are extending the infrastructure program which was so successful in kickstarting the economy shortly after the last election.

Just as important, we are investing long term. The Canada innovation fund will strengthen the abilities of universities to contribute to research, to the advancement of knowledge and to new job opportunities in the future. We are making it easier for students to attend university through improved tax treatment of their expenses as students from which either they or their parents can benefit, and by making it easier for them to repay student loans. The government has made it easier for parents to invest in a registered education savings plan for their children's education.

The economic indicators are all right at this moment. There are low interest rates, low inflation, a dramatically improved trade situation and a dramatically improved balance of payments. We have 700,000 more Canadians working today than were working two and a half years ago. That is quite an accomplishment. We went into the 1993 election with predictions from the then government that unemployment would not go down until well into the next century. That was not good enough and that is why we invested in both short term jobs and long term economic prospects for Canadians.

A number of the measures in the budget are also an indication of how we have strengthened the Canadian family. In a sense it began with the Team Canada missions to stimulate the economy and create better opportunities for Canadian firms to sell abroad and to

create jobs at home. That has led to the provinces working together in many other areas.

The new child tax benefit would not be possible without the co-operation of the provinces. There are a number of measures throughout the budget, such as health care initiatives, that rely on that co-operation, that of working together as a Canadian family for the benefit of all Canadians. By working together we strengthen our bonds across this great country and strengthening our ability to do even more in the future.

I am proud to speak on the budget. It shows some very difficult measures have been taken but they have been producing results. There are those who would say give people tax cuts. There are those who would say cut more and faster. On the other side there are those who would say spend more and do not worry about the debt and deficit.

This government will not jeopardize our history of compassion, of caring for one another, of investing in the future of all Canadians. Nor will we undermine the gains that have been made at great sacrifice for many Canadians.

This budget represents a record of achievement but it also represents a launching pad for the future based on a much more solid confidence in our economic situation, based on a sense that people have had good government, honest government and that is a record I am pleased to stand on.

The BudgetGovernment Orders

5:30 p.m.

Reform

Ted White Reform North Vancouver, BC

Mr. Speaker, I listened to the speech quite carefully and can hear that the member is genuinely concerned about child poverty.

In all sincerity I would like to ask her if she could please give me her definition of poverty. This is something I have been asking today of each of the members because I know what my constituents define as poverty. I am really very interested when we throw this word around to actually have a definition of what that means.

The member mentioned that 700,000 jobs were created by this government. Not true. The private sector creates jobs for the most part and, for some strange reason, there has been no net increase in the number of jobs. We are still stuck at the same unemployment level. Perhaps the hon. member can explain to me, if the government has created jobs, why we still have the same unemployment.

Since she has expressed an interest in the government helping young people get into jobs, can she tell me whether she supports the self-employment assistance program carried out by EI, which specifically excludes white men under 45 years of age from being able to use their EI benefits to start a small business.

The program only applies to women, men 45 years and older, visible minorities, aboriginals or people with disabilities. It specifically excludes one of the highest unemployment areas in the whole country, young white males.

I would like the hon. member to tell me, since that is funded by this budget which she is in support of, whether she supports that discrimination.

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5:30 p.m.

Liberal

Marlene Catterall Liberal Ottawa West, ON

Mr. Speaker, I am not sure if the member was not listening, if he misunderstood, misheard or heard what he wanted to hear. I never said that the government created 700,000 new jobs.

I said that there are now 700,000 more Canadians working than were working in the fall of 1993. I am the last one not to give credit to the private sector, particularly to the small businesses that are creating jobs and that are getting help from this government in this budget to continue creating jobs.

May I mention only the new highest program which forgives contributions to the employment insurance plan by new businesses, small businesses that hire new people in the coming year.

The member asked about the definition of poverty. People can to to Statistics Canada or to the Canadian Council for Social Development and get a definition of poverty that is expressed in dollars. Let me talk about what poverty means to children in my community, the people I represent.

Poverty means not having enough food. Poverty means not having proper medical and dental care. Poverty means entering school at the age of four or five, already well behind their classmates in terms of the experiences they have had and therefore their ability to learn and profit from school.

Poverty means going to school not as well fed, not as well clothes and therefore immediately at a social disadvantage in the school environment. Poverty means going to school never having seen a computer or having had the opportunity to play with a computer as many better off Canadian children have had.

Poverty means being behind the eight ball from the time people are infants. It means their mother being less well nourished and therefore their being born less healthy, with less energy, less able to thrive, less able to learn, less able to enjoy life.

That is my definition of poverty. I see it in my community every day.

I do not know the details of the program the member mentioned. I do know that the self-employment program under the EI plan has been available generally to people seeking EI. It was over subscribed to half way through the two years I have been aware of its existence.

If we question that in this country women particularly are economically disadvantaged and it is the reason for many children

living in poverty in this country and that we need to do something to correct the situation, I do not think we are facing the reality about the inequalities that exist in our society.

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5:35 p.m.

Bloc

René Canuel Bloc Matapédia—Matane, QC

Mr. Speaker, I would like to say a few words about poverty as well, like my colleague.

We have the case of the man who has a family, who wants to work and has no job. There is the young 24-year old who just got a degree, has incredible qualifications, sends his resume everywhere, and people do not even bother to answer. I could go on for ages, trying to define poverty. Yet, we realize that we are among the seven richest countries in the world. However, in this country we call Canada, there are still places where poverty really exists. I agree with my colleague who gave a very good description of the problem.

How can we make up for this? Poverty exists, we all agree on that. We agree on other points as well, that there is a deficit and we have to deal with it, so as not to mortgage the lives of future generations. My children's generation, and my children are in their twenties, is already in debt. There are other children in my riding who are even worse off than my kids.

Yesterday, I was talking to a woman of 35 who told me she was still paying for her education. That is poverty, too. How can you start a family if you are still paying back a student loan after ten years? When we know that as far as jobs go, the future is uncertain, how can we create hope? If we have no hope in our lives, I think we are only half the man or the woman we could be.

We agree that poverty exists and that we have a deficit to pay off. But it is not up to our children to pay off the deficit, because we created that deficit. Starting in 1970, under Minister Lalonde and other finance ministers, it was paradise on earth: "Anything goes, borrow now and pay later". I fail to understand how brilliant men and women in this Parliament managed to put us into debt to this extent.

Well, it is no use crying over spilt milk. We have to find a way out. And there are a number of ways, as I see it. Some economists also agree. However, and I want to repeat this at every opportunity, why can the government not take specific steps to get as much money as possible without weakening the neediest among us, without creating a psychological threshold which means that in some regions, people do not know what to do any more?

Ask people who have are unemployed, who have lost their jobs and are living on welfare. It is hard on their dignity. It is very hard on children too. In my opinion, we have to turn things around and go where the money is.

I said it earlier and I say it again, I could say it a hundred times, no one is listening, but I could say that I had repeated it: how is it that there are rich people that always manage to be on the right side of the fence, without paying or hardly paying any income tax, when the poor people who have the misfortune to outsmart some of the rules of employment insurance, which I call misery insurance, automatically get nailed?

This year I have run into several cases of people who are honest but perhaps naive and who at some point were without work. They were employed; legally this was not right. Morally, however, they had to feed their family. They were told: "You are going to do so many hours". The calculations were not done right. One of these people owes the unemployment insurance system $40,000, because this situation went on for four years. Some agreements were reached for him to repay, but he has no work. He is suffering from depression.

I realize the officials are doing their job. I accept that. What is not legal is not legal. But, how is it, when I look on the other side of the fence, that I see respect being given to the multinationals whatever they do? Nobody bothers them.

I repeat: so long as this government and this party do not set rules for themselves for the election fund, who will govern? They lack the courage to do what René Lévesque did in Quebec, and he was quite proud of himself for it. Just before his death, he indicated he was proud of Hydro-Québec, yes, but more importantly, of having settled the issue of fundraising, for his party and others. You may know that, in Quebec, corporations are not allowed to contribute millions of dollars to campaign funds. They are not the ones making $100,000 contributions to political parties, only individuals can do that. As long as they will not have the courage to do the same thing, we will keep asking the same questions and getting the same answers.

I listened to several speakers who are very sensitive to the plight of the most disadvantaged and really want to do something about it. I sit on a committee on which there is much talk about the rural and regional community, and the committee members are quite serious. The problem is with the measures being considered. Desperate times call for desperate measures. If financial considerations cannot be set aside so that the government can have its hands free, very free and very clean hands, we will get nowhere. The alternative is to go a long way.

It may have been unreasonable of him to say so, but we did hear the Minister of Finance utter the words, and I quote: "We can see that the worst is behind us, that brighter days lie ahead". I wish the worst were really behind us.

I for one fail to see how the situation has improved, in the regions in particular, these past three years. In my region, where unemployment is on the rise, jobs are hard to find and the minister just steals bread from the mouths of workers, I cannot see how one could say that the worst is behind us.

I remind the Minister of Finance that there are 1.5 million people looking for work in this country, and 400,000 young people waiting to get on the Canadian labour market. In a rich country like Canada, why can the right climate not be created, where everyone would have a job? While the unemployment rate is 5.5 per cent in the United States, it is soaring at 10 per cent here. Something is wrong. Something is definitely wrong.

This government's real strategy is to starve regions like mine, to starve the fishers in the Gaspé, as well as farmers, and to force forest workers onto welfare. What is this government doing for small business? What is it giving small business, farm producers and forest workers? Crumbs. There was the infrastructure program. Great. It was a tiny step in the right direction. But only temporary jobs were created. What the people of my riding and other ridings in Quebec are asking for are good permanent jobs, but the government is not listening.

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5:45 p.m.

Liberal

John Bryden Liberal Hamilton—Wentworth, ON

Mr. Speaker, I listened to my colleague's remarks with great attention. He commented on how this budget takes aim at certain areas of the economy, that it does not attack multinationals.

This budget has spared the big unions. It has not done anything that would erode the rights of organized labour to earn a wage and to have its rights. In Quebec we have a situation where the Government of Quebec is attacking the public service unions. it is trying to cut their pay and benefits. I suggest to my colleague that we have a federal government that supports the traditions and rights of organized labour, yet we have a provincial government that has been threatening those very rights and those very incomes of organized labour. Could he comment on the situation in Quebec vis-à-vis what the federal government is doing?

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5:45 p.m.

Bloc

René Canuel Bloc Matapédia—Matane, QC

Mr. Speaker, first, if the federal government had not cut transfer payments to the provinces, many things would be better. Second, unions in our province have made tremendous progress for many years.

As a unionist, I think we must know what we want from society. We live in a society that is constantly changing, and I congratulate the Quebec premier for going through this exercise with the unions. There are differences of opinion, but there are also many points on which both sides agree. I believe an agreement will be reached as soon as possible.

Some things do not change, though. I am referring to the multinationals and the family trusts. I should also have talked about the banks. Banks make billions of dollars in profits. I understand the banking system, and I know that the profits belong to the shareholders. But why not ask the banks to make a greater effort? Why can we not get a little more out of them? This way, we could provide better protection for the poor.

How dare the government take money from the unemployment insurance fund, which is financed in part by the unemployed and in part by the employers, to reduce the deficit? This is simply outrageous. I almost feel compelled to say it is robbery.

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5:50 p.m.

Reform

Jim Silye Reform Calgary Centre, AB

Mr. Speaker, the member from the Bloc mentioned somewhere in his speech that there is something not right here, that this budget is not working and something is not right.

I would like to point out to him that it is not just the budget that may not be right for Quebec, it is the fact that this whole separation movement in the province of Quebec is causing a lot of the poverty as well.

There is a lot of uncertainty for businesses as to whether or not there is going to be growth. The numbers of businesses that have closed down in Montreal and Quebec City and that are moving out of Quebec must be obvious to the member. He must see that they wanted to separate, they lobbied to separate, they have tried to separate for four years, they had a democratic vote and the democratic vote resulted in a loss.

Therefore, why do the separatists not give it up and try to change things in Quebec, make things better for Quebecers within Confederation, within the country? Then they would get growth in Quebec. They would get that $4 billion deficit eliminated. The PQ is not doing a very good job either in running that deficit. That is how they can help people in their province. They should take some responsibility and quit these shenanigans with a referendum vote every four years.

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5:50 p.m.

Bloc

René Canuel Bloc Matapédia—Matane, QC

Mr. Speaker, when Mr. Trudeau was Prime Minister, when Mr. Lesage was Premier of Quebec, we did not talk about separation. The expression was "maître chez nous". It was perhaps a first step, but we did not talk about that. Yet, at the time, the unemployment rate was high. Enough of confusing the issue.

Since we started talking about it, people are increasingly gaining confidence in themselves. Look at the referendum results: the first was 40 per cent; in 1995, it was 49.5 per cent; in a few years, in 1999 or 2000 at the outside, it will be 52 or 53 per cent because

people will have more confidence in themselves. They are also saying that even with Mr. Trudeau and Mr. Bourassa, we got nowhere. We are now at the point where we have pride in ourselves. We have confidence in ourselves and we are going to reach our goal: our own country.

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5:50 p.m.

Bloc

Stéphan Tremblay Bloc Lac-Saint-Jean, QC

Mr. Speaker, as I begin my speech in reply to the budget, I would like to commend the hon. member for Matapédia-Matane for what he said. In spite of his age, he has the courage to challenge the mistakes of his generation, which is very wise.

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5:50 p.m.

Some hon. members

Ha, ha.

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5:50 p.m.

Bloc

Stéphan Tremblay Bloc Lac-Saint-Jean, QC

Today I am relieved I do not have to sing the praises of this marvellous budget. I am always surprised when I listen to members opposite. They have no choice. They toe the party line and have to praise this wonderful budget, the budget of the century, as much as they can, although they know perfectly well it is just a pre-election budget.

We are not going to go back and criticize their policies in general, but I could talk about this for a long time, make no mistake. As the Bloc Quebecois critic for training, youth and literacy, I will deal with these areas, which are of particular interest to me. You know as well as I do that Bloc members maintain that these areas should be transferred to Quebec, which is in a far better position to find ways to deal with these problems. I think that is pretty clear.

I have said it often enough, but when we visit community organizations, not just in Quebec but across Canada, organizations which help poverty groups or similar groups in connection with manpower training, people say that social programs should be tailored to their needs. And these needs are often regional.

Take for instance Quebec, where in many cases, the problems are not the same in Lac-Saint-Jean and Montreal, although it is the same province. Imagine the difference between Lac-Saint-Jean and Vancouver. I cannot say this often enough. Until we have our own powers, and even when we do, I will keep fighting for sovereignty because that is the solution, more often than not. We will have all the powers we need, and we will be masters in our own house.

I would also like to comment briefly on my colleague's speech and on political party fund raising. When people say that politics is dirty or politics is fishy, I think that is very interesting. When big business can pay lobbyists to influence the government or public servants to create legislation that would be to their advantage, to the advantage of the corporations, one might well ask some serious questions about democracy.

We in Quebec have set ourselves a limit: only individuals can make contributions. Yes, it is hard to fund a political party, and I am pretty sure all my colleagues in the Bloc Quebecois agree with that, but at least this is more rational.

To return to this budget, I really like to criticize, it does not bother me in the least to do so. But on the other hand I also really like to offer solutions. The best solution I can offer, however-and I am not the first to do so-is for us to be masters of all of our own actions. That will be the first solution.

In the meantime, while waiting for 1998 or 1999 to come, we are still paying taxes to this Parliament, to this federation, so we are fully entitled to criticize, since it is our money. Before criticizing anything else, however, I would like to start by reminding you that the Bloc Quebecois has done a study on tax reform, since we know that there has been no review of the taxation system for a good number of years.

One need only think back to the Bronfman family scandal, the family trusts, other similar tax evasions. At present, there are corporations, big companies in Canada that are not paying taxes, which is scandalous. When an individual commits tax fraud, someone who may be under the poverty line, and he is arrested because we have the means of arresting him, this is easy because only a small amount is involved compared to the big companies. They may not pay their taxes, but we let them get away with it. A large corporation does not pay tax, and it is legal-that is the worst part about it-and makes huge profits. That is all quite normal.

The Bloc Quebecois has, therefore, studied the issue of tax reform, and has even had some praise from the Minister of Finance on it-I am not sure that is a compliment, but there you are. He told us that it contained some extremely interesting things, as did the personal income tax reform. We said there were ways of getting money out of businesses, but there would also be a more left-leaning approach: personal tax reform, for there are currently many situations in which single parents with two children are having a great deal of trouble surviving. Many similar situations where reform would be worthwhile could be identified. So we did this, and proposed our reform to the government.

I even brought it to Ottawa in English so that the public servants there could understand it.

I am going to take a little time over several points of this marvellous budget, which I will call a pre-election budget. I have been in politics for almost a year now-it will be a year next week-and it is still fascinating to see how politics works.

Here is one example. This year we are told: "There are no cuts, everything is dandy. The people of Canada have a fine government that will make no cuts". What you have to know, and the public will practically never know, because people have better things to do

than to hang on every political word, is that last year cuts of $4 billion were announced, to take effect this year. That is politics.

Last year, which was not a pre-election period, cuts that would hurt were announced. But they were to take effect only the following year, which was not so bad. This year, there is no mention of them. That way, they go unnoticed.

Another thing that is my responsibility is the youth employment strategy. Last year, the government released money and made a grand announcement of $285 million in spending a year. What happened? Last year they announced that they were going to spend this amount, but they did not. They waited a year.

That reminds me of the saying of an old politician. He said a bridge is worth three elections. In the first election, you announce the bridge. In the second, you announce the construction of the bridge. In the third election, you boast about having built the bridge.

This is how the present government seems to be operating. As I was saying, they announced millions of dollars last year; this year they are again boasting about making money available, but this is not the case for it was already available, except for the announcement that they have found a way of using it. They are going to use half this year and the other half next year. I am prepared to bet,Mr. Speaker, $10 if you like, that next year the government will make a lovely announcement about the youth employment strategy, telling us how they have developed wonderful programs, when the money has been available for three years. In the end, it starts to sound a lot like my bridge story.

Another thing that fascinates me is tourism. They talk about creating jobs in this budget, of additional funds, and tell us that tourism is a future niche market, that it is important to invest $15 million annually in tourism over three years. I have just one question. Will this be used to fund Attractions Canada? I cannot leave out this "attractive" tourist initiative.

Throughout Quebec right now, and I imagine this is true all the way to Vancouver, there are posters about Attractions Canada. What does it do? We do not know. It is probably a quiz or something of the sort. It is unbelievable.

I see that I have only about 30 seconds left, but there is one last thing I would like to mention. This week, weekly newspapers in my riding were carrying some wonderful advertising singing the praises of the federal system. It said that Quebec was receiving more than the other provinces.

A word to the wise. Canadian solidarity and equity are important, I agree. But when Ottawa procures only 20 per cent of goods and services in Quebec, what kind of solidarity is that? They say that 15 per cent of armed forces personnel come from Quebec, but that is almost 9 per cent less than it should be. Quebec receives16 per cent of federal investments, when it should receive 24 per cent.

I could say a great deal more, but my time is up.

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6 p.m.

Liberal

John Bryden Liberal Hamilton—Wentworth, ON

Mr. Speaker, I listened to my colleague across the way with great attention. I have to tell you that his words cause me great distress.

The reality is, whatever the shortcomings of the budget, and I do not think it has many shortcomings, it has done nothing to attack organized labour. It has not attacked unions. Indeed, other legislation is drawing a line in the sand on replacement workers. The government has taken very positive steps toward supporting organized labour.

Does the member opposite recommend therefore that the government, in order to save money, should have attacked the spending on the unions? Should we have sought the rollbacks and cutbacks that the provincial government in Quebec and Mr. Bouchard are applying to the unions in Quebec? Is this the model that we should be following? Should we be doing what the Parti Quebecois is doing to the unions in Quebec? Is this what he wants the government to do? Please answer.

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6:05 p.m.

Bloc

Stéphan Tremblay Bloc Lac-Saint-Jean, QC

Mr. Speaker, I really have no reason to criticize what the provincial government does. However, I can tell you that he does so because he has no choice: it is because of the $4.5 billion in cuts by the federal government. Politics is easy here in the federal government. One year the government makes huge cuts, slashing transfer payments to the provinces. The next year, it brags about reducing the deficit and eliminating it within three years. That is pretty easy to do.

In the end, it just means eliminating one cheque. They call Quebec and say it will not have the $4.5 billion anymore. They shift the problem to another level of government. The Government of Quebec has a problem: it is not getting as much money as it expected. The Government of Quebec, which is closer to the people, has then to find solutions. So, when they have you by the throat up to here, you have no choice.

I have no comment on the measures Quebec has taken, but, what does offend me is when the Liberal government boasts about reducing the deficit, when it did so on the backs of the provinces.

It is easy being a federal government.

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6:05 p.m.

Reform

Jim Silye Reform Calgary Centre, AB

Mr. Speaker, the member from the Bloc is very keen and I enjoy listening to his speeches and comments. It is a view from a younger generation, the generation that is going to have to pay off the huge debt, if we ever get out the deficit which the government cannot get us out of nor can his own provincial government get out of its deficit.

During his speech he said that the federal government is ignoring the wishes of Quebec and that the province of Quebec should be doing more for itself and the federal government should get out.

In one way I support his concept that the federal government should butt out of a lot of areas. My colleague for Edmonton Southwest discussed this a few minutes ago. The provinces should get together and tell the federal government: "This is what you are are going to do, these are the areas you are going to look after and these are the areas we are going to look after". That should be the new Canada constitution. I am sure the province of Quebec could contribute to something like that without separating and look after the areas it wants to look after.

Here is my point. Quebec looks after its own immigration policy, whereas in the rest of Canada the feds do it. Job training is going to be looked after by the provinces, including the province of Quebec. Quebec looks after its GST, whereas we in Alberta have to do it through the federal government. The CPP is looked after by the provinces. A lot of these programs are already administered by the province of Quebec.

I am suggesting to the hon. member that the Quebec government sit down with the federal government and say: "These are the areas we want you to look after for us. These are the areas we will look after ourselves, thank you very much". I would like to hear the member's comments.

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6:05 p.m.

Bloc

Stéphan Tremblay Bloc Lac-Saint-Jean, QC

Mr. Speaker, I must do my duty. Since I was elected to do so, I will promote sovereignty and try to explain it to the rest of Canada. I am surprised that people still do not understand, although we have been talking about this for so many years. I wonder why. I have travelled in the rest of Canada. I like Canada. I have nothing against it.

What is wrong with wanting our own country, which may be smaller, easier to govern, when this is similar to what our big corporations are now doing? People realize that large corporations are too difficult to run, so they are making them smaller to be closer to the employees, to perform better. That is what sovereignty is supposed to do. We will have everything we need to meet the needs of the people of Quebec. We do not want to make Quebec sovereign just to penalize the rest of Canada. On the contrary, the rest of Canada would benefit.

Look at who is the official opposition in your country, Canada. These are members from Quebec. Quebec intends to have a real debate, it does not matter whether people are on the left or on the right. We will pass our own laws and collect our own taxes, and we will be able to talk to each other. No problem at all.

I would like to continue this discussion, but you are signalling that my time is up.

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6:10 p.m.

Liberal

Derek Lee Liberal Scarborough—Rouge River, ON

Mr. Speaker, I recognize that I am joining in the debate very close to the end of the day's proceedings. What has brought me into it is the incessant carping of the opposition day in and day out. I hesitate to call the opposition a one trick pony, but it is getting close to that.

The budget that we are debating is much more than the opposition gives the government credit for and most Canadians recognize that.

I bought a car recently. When I was doing my shopping, I was pleased to have a salesman, at one auto dealer at least, tell me that one of the other cars I was looking at at another auto dealer was a good car. Yet, as the opposition carps on about what the government is not doing or what failures it alleges are there, I am not hearing anything constructive or realistic in the assessment.

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6:10 p.m.

An hon. member

That's not true.

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6:10 p.m.

Liberal

Derek Lee Liberal Scarborough—Rouge River, ON

It is very true. One opposition party is telling us that the government is going to hell in a hand cart for whatever reason, and the official opposition is taking us to hell in a hand cart with its wish to lead Canada into its form of partition. I find it hard to believe that there are MPs in this House who would advocate the partition of this great country but, sadly, there are.

Although many of us understand where some of them are coming from on policy issues, we have a country to run here and we are not going to survive if we continue to admit, even for debate, this myopic, down the tube, kind of mentality that I have heard around here in the last few weeks.

I have about two minutes to talk about this. The government takes pride-and I am sure the opposition will allow this-in its fiscal record; that is, management of the government's finances. I do not have to go on and on because I am sure my colleagues in government have gone on and on about how well we have done.

What the government has done has been recognized around the world as a stunning success in fiscal management. I hope Canadians will recognize that the next time they get a chance at the polls. We are on course and we are going to stay the fiscal course that the finance minister has set out for us. We have done darn well.

We have excellently placed interest rates. We have a current account either in surplus or capable of generating it. We have solid economic growth.

I just received a sheet of economic indicators. It is a forecast from the policy and economics analysis branch of the program at the University of Toronto. There are two items that must be mentioned. The first item is fiscal and the other item is macro-economic.

The macro-economic note worth reading is that the country turned the corner on the debt to GDP ratio between the second and third quarter of 1996. It has dropped from a peak of 55.5 per cent and is now headed downward into the lower 50s and will be into the upper 40s fairly soon.

The other note is fiscal. On a national account basis, the government will have no borrowing needs by the third quarter of 1998, roughly a year from now. Canadians can take pride in this.

Having noted those two major items on the economic front I will close my remarks.