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

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3:30 p.m.

Liberal

John Cannis Liberal Scarborough Centre, ON

Mr. Speaker, that is a very good question. I thank the hon. member for his comments.

The question does not respond to the figures he gave between the year 1976 and the year 2030. However it is very important for the people to know that the Canada pension program is not strictly a program of the federal government. We did not simply decide that we would do this. The program is administered in co-operation between the provinces and the federal government. We did not arbitrarily say one day what we were going to do. We all know about the negotiations that went on.

We agreed to a 10 per cent increase. The fact remains that the Reform Party wanted to increase it by 14.2 per cent. If he is concerned about the numbers he has given me, in essence he is saying these are the numbers we will have with a 10 per cent increase over the next six years. He is not saying how wide the gap will be with their proposed 14.2 per cent.

Their programs do not provide for any disability phase of the Canada pension plan. As an employer I looked at it as part of the benefit package when it came to hiring staff. It was part of my obligation. When we moved over from health premiums and the employer had to assume that responsibility I was very happy to take it on. I made sure the health program had an infusion of money. It was my responsibility as an employer to make sure that based on the payroll deductions I had to contribute to the health system. That was one way of securing the health system would be there.

In essence the gap would be wider if we had gone with the Reform Party proposal.

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3:30 p.m.

The Speaker

Now for a really astute question from the hon. member for Capilano-Howe Sound.

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3:30 p.m.

Reform

Herb Grubel Reform Capilano—Howe Sound, BC

Mr. Speaker, I am not sure I can live up to this advanced billing, but I would make a remark about payroll taxes.

Economists look at payroll taxes in the following way. Workers are hired at a wage rate of $10. That is what a small businessman can afford to pay. The technology chosen, whether to use computers and what kind of computers to use, are predicated on the fact that the wage cost is $10. A bargain is struck and everybody is happy.

Then the government decides that as of tomorrow the hourly cost of the worker will not be $10 but will be $11. Under those circumstances a multitude of companies and employers in Canada that could afford to hire someone at $10 can no longer afford to hire them at $11.

A large number of companies will say that at $10 it is not worth introducing an automated machine to take the place of the workers, but at $11 some will automate more. The workers will lose their jobs or will not be hired if the company expands. That is what is taught in Economics 101 in university as being the effect of government legislated increases in payroll taxes.

I do not care whether the increase from $10 to $11 in the cost of hiring a worker goes to the worker's pension or not. It does not. It is interesting what happens in the long run. Studies have shown that increases from $10 to $11 mean that those who remain hired will not get any more pay increases. In the long run it is the worker who is paying for the government legislated increase.

Could the hon. member tell me where he got the information that for 10 million people in Ontario there are 11 million care cards outstanding? Could he quickly summarize for me how this came about? It is an unbelievable statistic.

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3:30 p.m.

Liberal

John Cannis Liberal Scarborough Centre, ON

Mr. Speaker, he would have to ask the provincial people. That is where it was from. I want to respond very quickly because I know my time is up.

The member for Capilano-Howe Sound is absolutely correct and I agree with him. Maybe, because I agree with him, that is why he was the first member who applauded our previous budget. As we reduce payroll contributions we could entice employers to hire. That is clearly stated in the budget.

As I mentioned in my presentation in 1993, EI deductions were $3.30 per $100. They are down to $2.90. They are going down to $2.80. As our economy grows our intentions are to reduce those premiums. Hopefully that will motivate employers to hire. He is absolutely correct in saying that. Then hopefully we can take part of those contributions and increase the savings with respect to the Canada pension plan.

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3:35 p.m.

The Speaker

The hon. member for Gaspé. Will you be sharing your time with anyone?

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3:35 p.m.

Bloc

Yvan Bernier Bloc Gaspé, QC

Yes, Mr. Speaker, I will be sharing my time with the hon. member for Anjou-Rivière-des-Prairies.

First of all, I would like to say that I was not thrilled with the finance minister's February budget. Why? Because the budget tabled by the Liberal government is what I would call a lazy budget. Let me explain. It is clear from the figures that the Minister of Finance has much more breathing room than he lets on in his budget.

No one can argue with wanting to balance the budget. I believe, however, that there is a way to go about it and, when targets are met ahead of schedule, one would expect that those who helped create this breathing room for the Minister of Finance would recover part of the costs, get back some of the money they have given the minister. The finance minister should have returned the favour.

The theme of this year's budget was: while balancing the books, we will combat child poverty. This was the theme. But how does this translate into reality? There are a few subsidies, measures that

are supposed to eliminate child poverty. But what does this mean in reality?

Practical measures for implementation this year-because children are hungry this year, right now-amount to approximately $70 million. But-and the Minister of Finance did not talk about it this year-he took close to $4.5 billion from the social transfer payments to the provinces. What is the impact of that? It means that the provinces are also forced to make cuts.

The provinces are forced to cut in the health sector, because there is a shortfall of $4.5 billion. They also have to cut social assistance. All these measures adversely impact on daily necessities, on post-secondary education. It comes as no surprise that things are not going well in the provinces, that provincial governments are forced to cut their payrolls, and that they have to consider increasing tuition fees in the universities-even though they managed to avoid having to do it this year. The fact is that when the federal government makes cuts, someone, somewhere, is adversely affected.

Again, the recurring theme, which may well be an election theme for the Liberals, is that something must be done about child poverty. The Liberal government is trying to show that it is reducing its deficit but, as I said, barely $70 million will be allocated this year, compared to the $4.5 billion cuts to transfers to the provinces. I want to say something about the largest cut ever made. What makes things even worse, and the Liberals should be ashamed of themselves, is that they target the poor in our society, namely the victims of this lack of jobs and those who rely on employment insurance benefits.

Everyone on the Hill and in this House knows that before 1993, the cumulative deficit in the unemployment insurance fund was as high as $5 or $6 billion. I realize something had to be done.

However, today, and the President of the Treasury Board has made no secret of it, in fact he even bragged that there was a surplus, today in 1997-this is March 1997-there is a surplus of $12.3 billion in the unemployment insurance fund.

When the Minister of Finance says proudly that he balanced his budget, he got the money somewhere. He took it out of the pockets of the provinces and of those who were hit by the lack of jobs.

What could he have done? I will try to give government members, the Liberals opposite, a few clues. They will not be able to say I do nothing but criticize. Today, I would like to do some constructive criticism. There are people on the Liberal benches who come from rural areas, who at one time were farmers and whose parents were farmers.

Here are some rules every good farmer knows: If you have a good harvest, you put 50 per cent of the year's profits in the bank,

and you reinvest the remaining 50 per cent in the land that helped you make those profits. You seed for the next harvest, to make sure the next harvest will be just as good.

Now the government has just taken $12.3 billion out of the unemployment insurance fund, I would have expected the government to introduce job creation measures for the people who need them. Of course two weeks ago, the Minister of Human Resources Development hastily tried to deal with one of the sticking points of the employment insurance reform by allowing hours to be accumulated for the purpose of calculating benefits.

This measure will cost scarcely $245 million and will expire in the fall of 1998, after the election. Then we will have to start all over again. This is just peanuts, these handouts for people who have been hit by employment insurance.

What does the budget contain regarding job creation? I would remind the House that the Liberals opposite were not elected to cut unemployment insurance. They did not have a slogan saying: If you elect us, we will cut unemployment insurance. They did not. Was they did say was this: "We are going to create jobs, jobs, jobs". That was the slogan they shouted as they waved the red book.

What is the government's record on job creation? The only real jobs that were created under this government were short term jobs, as part of the infrastructure program. There was some highway construction and other construction, but the jobs created were only temporary jobs in 1994. We are in 1997 now. The effects of this job creation program are long gone.

So where are the job creation projects and the famous jobs, jobs, jobs? If only the government would act as a catalyst for job creation. How? I will give them a few more leads.

During the referendum campaign, we, in Quebec, were asking for decentralization. We wanted to see powers transferred back to us. The Prime Minister took us at our word and said: "We are going to decentralize powers, in the area of manpower training in particular, and transfer these powers back to the provinces". The referendum was held in the fall of 1995. We are now in the spring of 1997, on the eve of another election campaign, and nothing has been done.

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3:40 p.m.

An hon. member

They will make one more promise.

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3:40 p.m.

Bloc

Yvan Bernier Bloc Gaspé, QC

Transferring powers back to the provinces, at least those who have asked for it, would be a good way to create employment. The funny thing about it is that agreements were signed, but not with the provinces had made a request.

If agreements were signed regarding manpower training, I would expect the applicable budgets to be transferred back at the same

time. This way, government would really be brought closer to the people, with the provincial government being in charge instead of the federal government. Synergy could be gained from these budgets.

I would like to see these budgets used to bring people together. Projects, not 10 or 20 week projects, would be designed to address a common problem specific to a group of people living in a certain area. With the available budgets, and the help of the private sector maybe, social infrastructure programs could be developed. The participants would be working together for at least three years to give them time to achieve something.

As I said, this is a lazy budget. I wish I had more time to share more constructive ideas. In the election campaign, the Liberals will boast about successfully bringing the deficit down, but they will be very careful not to mention whom they have to thank for that. There are the provinces, whose postsecondary education and social assistance budgets were cut back, and the unemployed, at the expense of whom the President of the Treasury Board and the Minister of Finance were able to build up a reserve fund of $12.3 billion.

There is still time, on the eve of the election, for the Liberals to give themselves a chance of winning a few seats in Quebec. Put something on the table, resolve the manpower training issue and give us the necessary budgets for job creation.

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3:45 p.m.

Winnipeg—St. James Manitoba

Liberal

John Harvard LiberalParliamentary Secretary to Minister of Public Works and Government Services

Mr. Speaker, I listened to the hon. member for Gaspé and took note of the fact that he described the 1997 federal budget as a lazy man's budget. I am not exactly sure how he arrived at that description. Perhaps it is because our finance minister makes the job look easy, at least easy compared to the performance that we saw for so many years under the former Conservative government.

He also noted in his speech that the finance minister is ahead of the budget projections he laid down when the government assumed office in the fall of 1993. It is true that the finance minister is ahead of projections and he should be congratulated for that.

The hon. member pointed out that since the finance minister is ahead of his projections he should be giving something back to the Canadian people. I certainly agree with that and that is exactly what the finance minister did in the 1997 budget.

I remind the member for Gaspé, the House and all Canadian people that in the budget there was a $600 million child tax benefit, something that had not been there before. There was a reduction in the EI premiums. In addition small and medium size businesses in some cases will be able to forgo having to pay EI premiums at all if they hire additional employees.

There was $300 million for developing and researching new ways of delivering health care, something that the Canada Forum on Health proposed and recommended in its report. There was $800 million for the Canada foundation for innovation for universities and colleges. Those institutions have congratulated the government for that far sighted initiative.

There were $50 million for social housing initiatives in the budget. There was double the funding for youth employment initiatives. There were millions of more dollars for tourism. When we put it altogether we have lower interest rates.

I noted just today that the Boeing company which has a manufacturing plant in my riding announced an expansion of 400 jobs. Those kinds of things happen as a result of good fiscal management.

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3:45 p.m.

Bloc

Yvan Bernier Bloc Gaspé, QC

Mr. Speaker, I am pleased to answer the question put by the hon. member. What I said was that I felt, upon reading the budget speech, that once the budget would be balanced, the finance minister's objective would be to redistribute wealth and to fight child poverty.

The hon. member pointed out that the minister announced in his budget that $600 million would be allocated to that goal. Again, I tell the hon. member that, this year, there is barely $60 million earmarked for that initiative. And children are hungry now.

Earlier, I mentioned that children's parents were made poorer, to the tune of $17 billion. The provinces were deprived of $4.5 billion through cuts to social transfers, while $12.3 billion was taken from the unemployment insurance fund, after paying off the first accumulated deficit of $6 billion. So, 12.3 plus 6 equals 18; and 18 plus 4 equals 22 or 23 billion dollars. The government is offering $600 million, which is already not much. However, this offer includes an amount of only $60 million for this year. This is where the problem is; this is what is upsetting. It is an insult to the intelligence of Quebecers and Canadians.

The hon. member also pointed out that there is another $800 million for the health sector, through the Canada Foundation for Innovation. Where did the Liberals get that money? They just cut $4.5 billion in transfers to the provinces for the health sector. Now, we are told that the government will allocate $800 million to research. Again, this is an insult to the intelligence of people. And this amount of $800 million will not all be paid this year. The

government is distributing election goodies, but does not want us to unwrap the candy before the election.

I wonder about all this. Will Canadians and Quebecers be fooled by such a budget? Imagine how things will be when the Liberals are re-elected. They will not hesitate and there will be no candy.

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3:50 p.m.

Bloc

Gilbert Fillion Bloc Chicoutimi, QC

Mr. Speaker, following on my colleague, the member for Gaspé, who described the budget brought down by the finance minister on February 18 as lazy, I am in complete agreement with this expression and I would add that, in addition to being a lazy budget, it is an election-minded one.

I am going to limit my remarks to employment. To begin with, it is a topic I am very concerned about. Last month, the human resources development office in the Saguenay-Lac-Saint-Jean region moved to Jonquière in the neighbouring riding of Chicoutimi. According to this office, there was an unemployment rate of 17.2 per cent in this region. By simply moving offices from one location to another, do they hope to create jobs? This is unacceptable. Furthermore, the only reaction I have heard in my riding is that an unemployment rate of 17.2 per cent in a region like ours is unacceptable, particularly when we know this government was elected in 1993 on its famous promise to create jobs. Every statistic shows they have not delivered the goods.

As for their slogan "jobs, jobs, jobs", the people in my riding have changed it to "We are as poor as Job, Job, Job", meaning the one in the bible. But let us take a closer look at what the Liberals are telling us about employment. First of all, there is the infrastructure program, with $425 million in new money. The question arises: "Did this program create jobs?" The Auditor General of Canada himself said it did not. Of course, when there is construction, there is a bit of activity everywhere. But afterwards, when everything is over, what remains? Do any full time jobs remain? None do.

And here is something worse still, a comment by an alderman in Chicoutimi on the infrastructure program: "This program only puts the cities further in debt". So much for this program, and for job creation.

Now, moving on to what this government could have done for job creation. It is no secret. The unemployment insurance fund has a surplus of approximately $5 billion. This government lowered contributions by 10 cents. Does the Minister of Finance think that 10 cents is enough to encourage employers to create jobs? I think not. I am not convinced that this can reduce unemployment.

As for the unemployed themselves, this budget has just taken away their last hope of getting back into the work force. In my riding, what they are now being offered are precarious jobs of limited duration. Yet people do want to work. Last month Alcan opened up 50 jobs in Arvida. Do you know how many people sent in a c.v. to the various employment centres in the region? More than 30,000. This shows that people want to work. The unemployed are not lazy. They want to work.

It would be hard for me not to have something to say as well about the unemployed paying off the government's deficit. The Minister of Finance could have convinced his colleague to make the UI rules more flexible. Why? Because the accumulated surplus could have given our unemployed a little longer to find work. But he did not. The Minister of Finance has made welfare the only prospect for the unemployed.

Even worse, this government is helping to increase unemployment: 14 jobs were lost in Chicoutimi because the Department of Human Resources Development decided to move the response service for the unemployed to Shawinigan, in the Prime Minister's riding. That is how they create jobs.

We are faced with a government that has given up trying to create jobs. It seems to me that instead of taking the money of needy Canadians to reduce this deficit, it could have created steady jobs for people. Steady jobs mean people who pay taxes. It also means people who buy consumer goods. This is what makes the economic wheel go round. Of course the Minister of Finance is above that sort of thing.

If people had jobs it would be a good way for the Minister of Finance to bring his deficit down. That is what responsible government means.

Yesterday, we all saw the Minister of Human Resources Development announce a major subsidy for a sock manufacturer. Congratulations, but this comes just before an election campaign. One wonders whether it takes an election campaign to have this government do something about job creation. Considering its record during the past three years, I think the answer is yes.

I therefore urge the federal Liberal ministers to come to my riding and announce investments. Come and announce new businesses, come and tell our unemployed workers that you support them, that you are working for them.

In concluding I would add the following. The federal government should mind its own business. Once again, the Liberals are encroaching on areas under provincial jurisdiction. In the health sector alone, new funding approved by the federal government constitutes additional interference. I wonder why this government insists on minding other people's business, replacing and duplicating provincial programs by introducing its own maple leaf programs.

Finally, this budget is just an extension of the flags program of the Minister of Canadian Heritage. This government is interested in its visibility. That is why they do television broadcasts and send flags. I agree that finding a job for an unemployed worker is not

spectacular, unless we oblige the unemployed to walk around with a placard that says "Canada" with the maple leaf on top. Maybe that is what our unemployed workers need for the government to take notice of them.

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4 p.m.

Bloc

René Canuel Bloc Matapédia—Matane, QC

Mr. Speaker, I have a question for my colleague, whom I would like to congratulate. With the unemployment rate in Canada at over 10 per cent, in the United States at 5.5 per cent, and in Quebec at 12 per cent, I wonder about this inequity.

How is it that, for the past 20 years, the unemployment rate in Quebec has almost always been 2 per cent higher than in the rest of Canada? Sovereignty is certainly not a factor, since it was the same when Mr. Lesage and Mr. Trudeau were in power. Does it mean that things are poorly distributed in Canada, that research and development are channelled more into Ontario and that we are being given crumbs, which I would today call misery insurance?

I would like to know whether my colleague shares these ideas and how is it that the government talks about being prepared to help the weakest regions, from sea to sea, when in my riding of Matapédia-Matane, no matter what we do, no matter what is undertaken, no matter how many Operations Dignity are launched, no matter how many public rallies are held, nothing is happening. But all we want to do is work where we live.

We are not asking for gifts, we just want what we are entitled to. I have a very positive example: investing in forestry is a plus. It pays the government well in terms of taxes. Instead of being given job security benefits, income security benefits or employment insurance benefits, people have a job.

However, we see that the federal government, which had a plan I considered acceptable, profitable for it, made cuts. There is an easy answer to this one, that forestry is a provincial matter-that is true in part-except that forestry workers pay their income taxes to Ottawa, and when they put gasoline in their chain saws, they pay a tax to the federal government.

I would simply ask my colleague from Chicoutimi whether he shares these ideas and what he might propose to have it change?

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4:05 p.m.

Bloc

Gilbert Fillion Bloc Chicoutimi, QC

Mr. Speaker, my colleague has just pointed out that, in a number of areas, Quebec is not receiving its fair share of federal government spending. The result is a shortfall of hundreds and hundreds of millions of dollars that businesses could use to create jobs.

We have only to think of the field of research and development where, relative to its population, Quebec is seriously underfunded. There is also the area of military activity: Quebec receives less than 18 per cent relative to its population.

This afternoon, in asking a question to which, as usual, I did not receive an answer, I pointed out to the minister responsible for social housing that Quebec had come up $120 million short every year for the last ten years. That is over $1 billion in ten years.

We could have revitalized construction with this money. As they say, when the construction sector goes well, so does the economy. Factories would have developed materials, produced services, our engineers and architects could have put down plans on paper. It would have meant work for people.

In areas with a real impact on the economy, Quebec is receiving very little relative to what it pays. Of course, if you are talking about UI, we receive quite a bit. In my riding, the unemployment rate is 19 per cent, but this is not the kind of money we want. We want money that will allow us to create stable and well paid jobs.

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4:05 p.m.

Vancouver Quadra B.C.

Liberal

Ted McWhinney LiberalParliamentary Secretary to Minister of Fisheries and Oceans

Mr. Speaker, I will note at the outset that I am sharing time with my colleague, the learned hon. member for Kitchener.

This latest federal budget confirms that we are well ahead of schedule in achieving the Prime Minister's goal of a balanced non-deficit budget before the year 2000. In 1993 we inherited a record $42 billion plus deficit budget from the Mulroney government. Since then we have been reducing the enormous deficit on a step by step basis with each of our annual budgets. This year the deficit will be down to $19 billion which is $5 billion ahead of our own favourable projections.

We have decided to stay the course in our goal of a balanced non-deficit budget, possibly attainable by 1999 now, and not to succumb to the pressures to undertake lavish federal spending programs.

What we have done, however, is invest in those key areas of vital concern to our economic future and our general well-being by maintaining our social contract with Canadians and our famed social security network which earlier generations of Canadians paid for with far higher taxes than their counterparts in the U.S. This means a stable national pension scheme with no reductions in benefits for those now in retirement. It also means upholding the integrity of medicare and, beyond that, also making significant new additions to take care of the disabled persons and to maintain and extend medical clinics and laboratories.

It also means new investment in advanced education and scientific research in medicine and engineering as the key boost to creating leading edge industries capable of competing successfully

in world markets and also to providing the long term, highly skilled professional jobs that go with that.

President Clinton in his second inaugural address on January 20 spoke about becoming an education president for the 21st century. The Prime Minister, in asserting a necessary federal government role of leadership in establishing national education and scientific standards on a competitive level with other post-industrial states, has moved to fill the gap in constitutional power created by uneven performance at the provincial level and different, sometimes mutually competing, provincial policies and programs.

The investment in pure research as the basis for long range, leading edge technological advances was the key to the German and Japanese economic recovery miracles post-war. We are making that same investment in advanced education and science now. As a result, we have in this new budget a very much strengthened and extended federal government program of support and financial aid for students and their families designed to provide a flow of high calibre professional and scientific graduates into new industries.

Taken as a whole, the budget demonstrates our commitment to fiscal integrity and to freeing Canadians from the burden of huge annual interest payments to foreign creditors. In this way we will be able to devote even more of our resources to much needed social and educational programs and to move at the same time, when the budget is balanced, to reducing taxation.

The new budget also has its direct implications for governmental structures and processes that go to the roots of federalism. The constraints on governmental spending in a period of fiscal integrity directed toward the goal of a balanced non-deficit federal budget mean that community decision making on major community projects that transcend any one level of government, federal or provincial, have to be made on a basis of co-operation and of common joint problem solving through mutuality and reciprocity of interests of the different governments.

The federal government and Quebec have for a number of years shared decision making over immigration with effective co-ordination of federal and provincial lawmaking.

Recent inspired initiatives by the Prime Minister and by the premier of British Columbia have been directed to human resources and to immigration. We have resolved, thereby, some longstanding intergovernmental differences.

Further agreements could follow in other areas like fisheries, for which the basis of co-operation has already been laid in several joint federal-provincial commissions for inquiry and study of long range goals. This highly pragmatic, empirical, problem oriented approach, proceeding on a step by step basis is the new co-operative federalism. It seems to be yielding concrete results in easing intergovernmental tensions and ending long festering differences. It is, in any case, a refreshing change from that old fashioned, essentially abstract, a priori approach to federalism that insisted on isolating problem solving into separate water tight compartments of lawmaking power, federal and provincial, with an absolute ban on the different levels of governments ever working together toward a common result.

In another, in its own way, unusual parallel development, the federal government has opened up the diplomatic processes of negotiations over Canadian complaints of non-compliance by the United States with the provisions of the Canada-U.S. Pacific salmon treaty of 1985, with its important conservation imperatives. It has opened it up to input from the main private stakeholders involved, the actual fisher people. The Canadian fisher people are having a series of meetings with their U.S. counterparts and feeding back their consensus and conclusions to the diplomatic negotiators on both sides.

This is the new pluralism which balances the new co-operative federalism. It is an application of a broadly inclusive participatory democracy which should see more informed and rational federal government expression of Canadian community interests in the fulfilment of our international law based treaty rights and duties.

The federal system, as we know it, thus continues to evolve, undergoing change through developing custom and convention as glosses on the Constitution as originally written. This is being achieved in concrete, substantial ways, in spite of the seeming failure of those rather abstract exercises in the dry light of reason, represented by the Meech Lake and Charlottetown projects of yesterday.

The latest federal budget, by establishing the fiscal parameters and necessary financial limits to federal government decision making, enjoins a new form of pragmatic, problem oriented federalism based on intergovernmental co-operation and shared decision making, federal, provincial and municipal; the new co-operative federalism.

Thus the debate in the House over the present budget makes its own very distinctive contribution to the new constitutional law in the making.

The budget with its ambitious, imaginative and innovative approach opens the way to new ideas in federalism and in the structures and processes of government.

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4:15 p.m.

Reform

Herb Grubel Reform Capilano—Howe Sound, BC

Mr. Speaker, I have in front of me a document issued by the Employment Insurance of Canada that has been financed by the budget. It has in it a program called the self-employment assistance program. Under that program people will be subsidized who have current

claims on EI or who have had their claims exhausted in the last three to five years. They will get up to 45 weeks of support, 90 hours of formal business training, development of a business plan, adviser consultations and other goodies.

Would the member support a budget that does the following? Candidates must belong to one of the five federally designated equity groups: women, men 45 years and older, visible minorities, aboriginals and people with disabilities.

Is a budget which allows an employment insurance program to be available to everyone except men under 45 who are not visible minorities, aboriginals or disabled good for Canada? Should we support a budget that allows this kind of discrimination in the free country of Canada?

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4:15 p.m.

Liberal

Ted McWhinney Liberal Vancouver Quadra, BC

Mr. Speaker, I thank the hon. member for Capilano-Howe Sound for his very interesting question.

He will be aware from my own discussion in the last few minutes that the budget does not operate in isolation, in its own watertight compartment. It operates within the general parameters of the Constitution and the principle of equality before the law, which it therein enshrined contains the very explicit affirmative action provision. I imagine the areas he is referring to reflect that.

Also a main thrust of the budget is creating jobs, creating meaningful education and meaningful training in advanced technology for young people. This is the whole thrust of the extraordinarily augmented provisions for aiding students and their supporting families.

I and other members fought very hard for having the federal government accept its role of leadership in education. We were oriented to the young. The groups he speaks of, under 45-year-olds whether white or any other colour, are very definitely the beneficiaries of the budget.

What we have done by creative extension of federal power to fill a gap in decision making we hope to extend for the future. It is a very necessary part of the new society as we enter the new century.

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4:15 p.m.

Bloc

Yvan Bernier Bloc Gaspé, QC

Mr. Speaker, I shall try to be brief, since I know my colleague for Matapédia-Matane would also like to ask the Parliamentary Secretary to the Minister of Fisheries and Oceans a question.

The parliamentary secretary spoke of fisheries and of the impact of the budget. I would like to draw his attention to the following: it is the victims of lack of work, the unemployed, who have made it possible for the government to have a lower deficit. My proof: the President of Treasury Board has proudly announced that the unemployment insurance fund now has a surplus of $12.3 billion.

I see nothing in the budget about returning a portion of the profits to the victims of lack of work. And because he is the Parliamentary Secretary to the Minister of Fisheries and Oceans, I wish to ask him a question.

With the modifications made to employment insurance, virtually all fish plant workers will find themselves without an unemployment insurance cheque for three months, during the winter. There is still be time for the Liberals across the way to amend the budget, to make an addition to it so as to ensure that fish plant workers do not end up going three months without an unemployment insurance cheque. Does he realize how hard it is to fish the Gulf of St. Lawrence when it is iced over?

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4:20 p.m.

Liberal

Ted McWhinney Liberal Vancouver Quadra, BC

Mr. Speaker, the hon. member speaks well, I feel, of the agreement between the Prime Minister of Canada and the Premier of B.C. on maintaining and organizing the fisheries. All provinces are free to reach similar agreements. As for unemployed fishers, surely the two governments can unite to face this common problem. I hope the Government of Quebec will have the intelligence and the open-mindedness to follow up and reach its own agreement with the federal government.

As for the question of unemployment per se, our government has created 750,000 new jobs in the past twelve months.

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4:20 p.m.

Liberal

John English Liberal Kitchener, ON

Mr. Speaker, I am pleased to rise today to speak on the 1997 budget so appropriately entitled "Building the Future for Canadians".

Canadians elected a Liberal government in 1993. Our government inherited a massive deficit that to most Canadians seemed out of control and would likely leave Canada and its citizens with limited prospects for personal much less national improvement.

Instead of sitting back and opting for short term policies that lacked vision, the government took the initiative and put in place a policy of deficit reduction that has become a model for the developed world. Alone among the G-7 nations we will have a budgetary surplus before the year 2000. Others are now talking about the Canadian miracle.

Having exceeded its deficit targets in previous budgets the government has once again come in well ahead of its 1997 target, placing the deficit at $19 billion and substantially bettering its commitment to reduce it to $24 billion or 3 per cent of GDP.

What has this meant for Canadians? This dramatic change over the last three years has reduced the cost of borrowing money for all Canadians. There is less competition for money. The confidence of international markets have driven Canadian short term interest rates to their lowest level in 35 years. This dramatic turnaround in our fiscal situation will contribute to the creation of jobs by making it less expensive for businesses to operate and by increasing consumer demand for purchases like houses and cars. It means, for example, that someone borrowing to buy a $15,000 car will make approximately $500 less a year in car payments.

Our success in bringing the deficit under control is beyond question. Within two years the government will be able to finance its operations and service its debts internally without borrowing a single new dollar. We will be self-reliant in a way that we have not been for almost 30 years.

However the budget and the government's vision do not stop there. For my constituents and for the average Canadian fiscal stability is important but there are also tangible and immediate results from the budget.

I am particularly pleased by the budget's direction and its intention of addressing those issues closely linked to the constituency level like the new student assistance package, strengthening our social assistance programs and supplying jobs through the Canada infrastructure works program.

With the renewal of the Canada infrastructure works program $425 million in new federal money, along with provincial and municipal contributions, will support $1.8 billion of infrastructure projects in 1997-98 and beyond. Canada infrastructure works has helped create over 100,000 short and longer term jobs. In Ontario this has meant updating and improving community infrastructures through 5,085 projects with an investment of $2.3 billion and creating 39,000 jobs.

I am very pleased with the infrastructure renewal since it has contributed in the past well over $2 million to my riding of Kitchener. This has been most welcome news for the area.

Something of particular importance and an issue close to my heart is the priority given to younger people in the budget. It is we all agree unacceptable that the rate of youth unemployment is double the national average. It is a waste of talent and enthusiasm. It mortgages our future.

For this reason I am encouraged to see in the budget a new youth employment strategy incorporated into program spending which will give assistance for well over 140,000 young people each year. It will supply experience for them in summer jobs and internships. Some $255 million in funding will give way to career summer placements and internship programs with private, voluntary and government sectors.

Last week in my riding of Kitchener I was involved in opening the Lutherwood Youth Employment Centre which had received a $96,000 federal grant through Youth Services Canada. This opening was conducted by unemployed young people who were finding positions under the program.

I recall very well the comments many of them made to me in their very excellent presentations. One said: "These kinds of programs have given me a chance". Another one said: "It picked me up from the floor".

Another pointed to a youth entrepreneurship program that had been funded in our area by the federal government. This program has 10 students at any one time for the past couple of years. Sixty per cent of the students of this program now operate their own businesses. This is a success story for Kitchener, for Canada and for small business.

We often hear the story from youth: "We have no experience and therefore we cannot find a job". We will give them that experience and I am sure the jobs will come. The budget addresses these problems in an imaginative way.

Closely linked to this is the issue of education. Clearly students are facing increased fiscal pressures associated with post-secondary education. They hear talk of globalization and global competitiveness. They are frightened about what this might mean for their own futures. At the same time they perhaps hesitate to pursue higher education because of rising tuition fees.

Other costs associated with university are rising as well. As my the member for Waterloo knows so well with two notable universities in his riding, universities offer so much for a community and their students. They enliven the community, bring consumer spending to the community and in general contribute so much to the development of the region.

In talking to many of the students in our area I realize many of them are now working in part time jobs that occupy a crucial time that they might devote to studying. With additional pressures at home and with additional fiscal pressures it is clear that we had to help out our student population.

Therefore in the budget we invested in the young and in students. I note specifically measures such as doubling the post-secondary education credit over two years and the opportunity to carry forward the unused portions of credits for application against future incomes.

This results in a combined federal-provincial tax assistance to an average student of up to $1,200. This represents an increase of approximately 30 per cent. Moreover, there will be assistance to students in their effort to repay loans. The deferral period for those facing difficulties in paying loans will be extended from 18 to 30

months. This combined with a grace period of six months after graduation means students will have up to three years with help in managing their student loans.

Parents saving for their children's education through the registered education savings plan will have the annual contribution rate doubled to $4,000.

More can, more will and more should be done, but it is clear the a government is committed to higher education, to youth and to the future. On the issue of strengthening our social assistance programs the government is proud of the way it has addressed the needs of society's most vulnerable, its children. In particular I wish to note the national child benefit system.

For years Canadians have agonized over the problem of child poverty. The government, in partnership with provincial governments, is doing something about it. This is a historic undertaking with two levels of government committing to a new cross Canada child benefit system, with the foundation being the Canada child tax benefit announced in the budget. Helping low income working families has always been a priority for Liberal governments past and present.

It is no surprise that the government has succeeded in working out a deal with the provinces to bring a new level of financial relief to Canada's families. Over 1.4 million families with 2.5 million children will see an increase in federal child benefit payments by July 1998. This means that families with incomes under $25,921 will receive higher federal benefits while those with incomes over this amount will continue receiving benefits at the current levels. The greatest benefit, and rightly so, will go to those with incomes under $20,000.

We want to provide more assistance to low income families with children and help those families escape the welfare trap. Currently families on social assistance lose money and many valuable benefits when the parents find work. This is an intolerable situation. The children of families would actually be better off if the family stayed on social assistance.

The new Canada child tax benefit will go to all eligible families, those working and those on welfare. It will also allow provincial governments to take some of the money they currently spend on welfare and redirect it to services and programs for working poor families, such as child care and drug and dental benefits.

We have come a long way since 1993. Sacrifices have been made at every step. Some decisions, while not universally popular, have been made so that the greater benefit of all is preserved for the future.

As a Liberal and a committed member of the government, I am proud of what we have done and the budget is a sign for the future. I applaud the Minister of Finance for his determined work and I look forward with confidence as the Prime Minister leads the country into the 21st century.

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4:30 p.m.

Bloc

René Canuel Bloc Matapédia—Matane, QC

Mr. Speaker, I listened with a great deal of interest to the hon. member's comments. He referred, among other things, to students. He said the government would lend students more money, and that they would repay their loans three years later. This is not negligible, but there is a contradiction here.

When students get into debt, it is not so bad, since it allows them to pursue their studies. However, what hope is there for a student who is in debt and who does not have a job? Sure, one can say: "There is money available. You get an education and we will lend you money. You will have three years to pay off your debt". I know students who have been out of school for 15 years and who are still paying off their debt. If we lend more money to students, they will still be repaying their loans at the age of 75. There is a contradiction here to say the least.

Let me get to the nub of the issue. Everyone agrees that we must reduce the deficit. It is obvious. But how should we do it? I put the question to the hon. member. This Liberal government has dipped into the pockets of the poor. It has also targeted the middle class by increasing taxes. Everyone pays.

Then there are the taxes on gasoline. The middle class and the poor are always the ones who end up paying. Why is the government letting family trusts get away? The banks appeared before our committee. I asked Royal Bank officials whether their bank would go bankrupt if, for a period of five years, the government taxed banks more. Of course not.

Banks make billions of dollars in profits. If we get $1 billion or $1.5 billion in taxes out of them, over five years, they will not go bankrupt, believe me. Why not go that route to eliminate the deficit? How many rich families do not pay taxes? Why is it that no Conservative or Liberal government can see that?

Do you know what is happening? It is easy to figure out why governments do not go that route. When we asked the House of Commons to adopt the same regulations as Quebec did concerning political party fundraising, who voted against that proposal?

In Quebec, there is an act which provides that the money contributed to political parties must come from individuals, not companies. Who finances political parties here? Who puts money in the Conservative fund? It is the major corporations. How can they go against these major corporations?

I almost have my answer. Still, I would appreciate it if the hon. member could shed some light on this issue.

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4:35 p.m.

Liberal

John English Liberal Kitchener, ON

Mr. Speaker, the question has many parts. To deal with the first part, in my speech I pointed out that the government's actions in regard to students would greatly increase the amount of income available to students during the time they are at university or in a post-secondary program. Second, I pointed out that under the changed RESP program, parents will have a greater opportunity to contribute to the education of children and will be encouraged to do so. Third, I pointed out that the deferral period will be expanded from 18 to 30 months.

I agree with the hon. member that student debt has been rising at an alarmingly high rate. However, student debt is undertaken largely by students who graduate from university. The hon. member talked about the poor. The working poor and the poor who do not work are overwhelmingly persons who do not have higher education.

Statistics, whether in Quebec or in the rest of Canada, point out that those with post-secondary education have an advantage. They have a much lower rate of unemployment and they are much more likely to contribute through loans. In terms of loan repayment it seems to be a way in which those who do gain the benefit of higher education in some ways pay for their own education.

The hon. member beside me told me that it took him 10 years to repay his student loan, and today he has a job. This case indicates that those with higher education gain benefits within society, so the point being made by the hon. member is not well taken.

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4:35 p.m.

The Acting Speaker (Mr. Milliken)

Order. It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Saskatoon-Clark's Crossing-Unemployment.

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4:35 p.m.

Reform

Grant Hill Reform Macleod, AB

Mr. Speaker, I will be splitting my time with the hon. member for Edmonton Southwest.

Each time I stand to speak on the budget, I try to judge it from the perspective of the last little baby I delivered before I came to the House of Commons. Zachary was a cesarean section and he was my last enjoyable duty in the hospital. When he was delivered, Zachary owed the federal government a debt of $16,400. Lightheartedly I tell my patients that when I was taught to deliver babies, to make them cry I patted them on the bottom or patted them on the feet. I made Zachary cry when I whispered to him that he owed the federal government $16,400. The poor little guy blubbered for a week.

Today Zachary, who is almost four years old, owes the federal government just under $22,000, as does every man, woman and child in Canada. I find that unacceptable. I have listened to cheer leading on this issue from the other side. I would like them to face Zachary. I would like members opposite to sit down with Zachary and explain to him that on his behalf they spent his money. They did not ask his advice, they did not give him any choice in the matter. Every grandma, every grandpa, every parent and every child in Canada today should sit down with this cheer leading crew across the way. I would like to give them that opportunity. I guess they will get the opportunity in the upcoming election and I relish that opportunity.

What does the budget document say on health care? It follows on a promise in the red book that medicare would be protected and a National Forum on Health to make sure health care is going in the right direction. The national forum presented its conclusions not so long ago, and its conclusions were trumpeted far and wide. There is enough money in the system. Use the money more efficiently. Improving the health of our children is a wise investment. Those were the things that were headlined across this land.

However, a little issue was missed. When they said there was enough money they also said there needed to be this cash floor of $12.5 billion. The forum presented information which was fairly liberal. They never did say that the floor, according to the government of the day, was going to be $11.1 billion. There is a discrepancy. It is a little discrepancy. It did not get much play in the press. I do not know why. I can only guess.

In the budget document on sustaining and improving our health care, I found a reinvestment in medicare. There is a reinvestment of $300 million over the next three years to be used for new initiatives. Here is how that $300 million will be spent.

Over three years $150 million will be spent for new projects in home care and drug coverage. Interestingly enough, the health minister seems to glom on to some of these. He wants to direct them to his riding.

There will be $50 million for a health information system; computers to follow and judge whether we are doing the right things in health care.

There will be $100 million in increased funding for community action for children.

That is great. That is $300 million over three years. I saw the headlines: "Good news from the protectors of medicare". I ask a simple question. Do they think all Canadians are stupid? Does anybody not remember the $3.9 billion in reductions to medicare that are coming in the next three years? Only in light of today's government could we have a $300 million reinvestment in medicare offsetting a $3.9 billion reduction.

What are the results of those reductions? We heard them not so long ago in Ottawa where there were major hospital closures. We heard them as well in Toronto where there were major hospital closures. A couple of weeks ago Alberta confirmed that the General Hospital would be closed for good. There are hospital closures in the maritimes. There are hospital closures in Saskatchewan and Manitoba. In Quebec there are hospital closures. Il y a la fermeture des hôpitaux là également.

Waiting lines are on the rise for urgent, non-elective care. We are falling behind in technology. We have 1.1 MRI machines in Canada for 100,000 people and in Germany they have 3.4.

Here is what Canada's nurses say about the budget as it relates to health care. This is not partisan, political stuff, this is from Canada's nurses: "In the 1997 budget the federal government has thrown away a valuable opportunity to demonstrate its supposed support for Canada's publicly funded health care system. Federal cash transfers for health will now decline until the next century, despite the fact that the finance minister's target of spending no more than 9 per cent of GDP on health has been reached. The federal government has stated that it unequivocally supports a publicly funded health care system, but is failing to provide the funds to genuinely support this system".

Canada's nurses are not politicians. They are the people who deliver the services. That is what they think of this budget.

It is always easy to criticize. I do not believe in criticizing without presenting solutions that are different. What would Reform do differently during the same three year period when we are going to have $3.9 billion taken away and $300 million given back?

Reform would reduce the deficit to zero by changing both the size and the function of the federal government. It would reduce grants and subsidies to business. It would take selected crown corporations off the public purse completely. It would reduce international aid while Canada is broke. It would rip up the MP pension plan which is grossly unfair. Reform would do all this to pump $4 billion per year back into medicare and secondary education. It would do that to repair the Liberal damage and the damage of those cuts.

The results will have Canadian nurses smiling again.

The national forum on health would have its $12.5 billion cash floor. Most important, the patients who are today waiting in lines with inferior equipment and in pain would be treated sooner. There is actually choice on the scene today when it relates to medicare in Canada. It is an alternative to the old view of the Tories, the Liberals, the NDP, of big government, big programs, big spending and big taxes. It is called the fresh start.

I will give a couple of examples of wasteful spending specific to health care because they lie in the riding of the Minister of Health. Here are some examples that Reform would get rid of: $122,654 for golf carts in the health minister's riding paid for by the taxpayers of Canada thanks to you know who; $33,000 to the Cape Breton Yacht Club. Yachters need that money according to the Minister of Health. What did Nova Scotians ask for instead? They asked for the emergency department at the Windsor hospital to be left open. They asked that the Wolfville hospital not have to charge patients for bandages, syringes and painkillers, which is what is happening today.

To my colleagues across the way when they cheerlead about this budget and the results that they have seen, I ask them to remember Zachary, the little boy who has gone from $16,400 indebtedness to the federal government to just below $22,000 in the course of this Parliament's sitting. They are happy with that performance. I am not. I look forward to meeting with them on the platform to specifically ask them to look into Zachary's eyes. If I were in their place I could not.

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4:45 p.m.

Reform

Ian McClelland Reform Edmonton Southwest, AB

Mr. Speaker, there does not appear to be a quorum in the House.

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4:45 p.m.

The Acting Speaker (Mr. Milliken)

Call in the members.

And the bells having rung:

And the count having been taken: