Debates of April 10th, 1997

Income Tax Budget Amendments Act, 1996

[Jay Hill, Reform, Prince George—Peace River, BC]

Mr. Speaker, it is a pleasure for me to speak today to Bill C-92, the budget implementation act.

I note that this is an act to implement parts of the 1996 budget. It seems more than a little odd that at this late date we are debating a bill which applies to different facets which were brought in under the 1996 budget, albeit in limited fashion because of the government's choice to use a procedure which was just argued against.

What does this mean? Obviously it points to the ineptness of the present Liberal government since it has taken it approximately 15 months to bring forward this legislation. As my hon. colleagues from St. Albert and Calgary Centre pointed out during their very eloquent presentations, it is a tragic misuse of Standing Order 73. It is a way in which the government is able to circumvent the democratic process and utilize a standing order which was agreed to by all members in the House very early in this Parliament. Perhaps we were naive enough to trust the Liberals. We do not do that very often, obviously for good reasons. We trusted the government not to abuse Standing Order 73 in this fashion. We took the Liberals at their word that the intent of Standing Order 73 was to allow more input from rank and file members of Parliament.

[Barry Campbell, Liberal, St. Paul's, ON]

Mr. Speaker, on a point of order. I am sorry to interrupt the hon. member. I know it is disconcerting to have that happen. I believe the Speaker has ruled on this issue and the hon. member in the context of his comments in debate on the motion has returned to a matter on which the Speaker has just ruled, against the position the member is advancing.

[The Acting Speaker (Mr. Milliken)]

I know the hon. member was making comments about the tenor of the debate. I did not think he was reflecting on the ruling of the Chair. I think the hon. member knows it would be improper for him to do so. Bearing that in mind, I am sure he will continue with his comments.

[Jay Hill, Reform, Prince George—Peace River, BC]

Mr. Speaker, since I did not opt to rise, as a number of members of Parliament did, to take the time of the House during that point of order, I thought it was within the purview of my presentation to at least point out that you are quite right, Mr. Speaker, I was not challenging the decision made by the Chair, nor would it be appropriate for me to do so.

What I was clearly pointing out is the misuse by the government of this standing order, not the decision arrived at by the Chair.

[The Acting Speaker (Mr. Milliken)]

The hon. member will want to be careful because the Chair has ruled that the procedure being adopted is correct in accordance with the rules. I invite him to be temperate in his remarks in discussing this issue. There has been a ruling from the Chair and I know he respects that. I invite him to perhaps address another subject. It might be safer.

[Jay Hill, Reform, Prince George—Peace River, BC]

Mr. Speaker, I was merely pointing out that I believed this standing order is broad enough and loose enough that potentially some abuse can exist. That was the point I was trying to make.

Earlier in debate the hon. member for Scarborough-Rouge River attacked Reformers, saying that we were misrepresenting the facts on how this government is moving toward a balanced budget. I believe the Canadian public is coming to realize that how the Liberal government is moving toward a balanced budget is on the backs of taxpayers.

Tax revenue has increased in the neighbourhood of $24 billion a year. There is a proliferation of user fees for various things that used to be provided for Canadian citizens. There is the downloading of approximately $7.5 billion to the provinces in reduced transfers through the Canadian health and social transfer. The government has been enjoying the lowest interest rates on the national debt in four decades.

If taxpayers and voters really analyze who is responsible for gradually bringing the budget into line they will recognize that they are. They are the ones who are paying and making the advances that have come.

It really galls me to no end when I hear government members saying it is because of the growth in the economy. Who has ever said that if we as a nation enjoy some growth in the economy big government should benefit by just taking more out of the economy to spend as it sees fit? It is the principle of the matter and I have great difficulty believing that principle is supported by the majority of Canadians.

This bill deals with a range of subjects, tax credits for individuals, child care expense deduction, deferred income plans, foreign reporting rules whereby people with assets overseas will have to report not only the income derived from those assets but the assets themselves to the government. It deals with a wide range of issues.

Earlier the member for Scarborough-Rouge River said Reform is not accurately representing the facts on the budget and the whole issue of bracket creep. People have asked me "who is this bracket creep and what crime has he committed?" They are really interested. They hear about this bracket creep and they wonder where they should direct their attention.

To try to explain it as simply as possible, bracket creep is what happens to a taxpayer in a certain income tax bracket who, because the government has failed to index income tax to inflation, finds himself moved up into another bracket.

[Ron Fewchuk, Liberal, Selkirk—Red River, MB]

That is the guy from Calgary.

[Jay Hill, Reform, Prince George—Peace River, BC]

The hon. member opposite is suggesting that it is only millionaires who experience this. It is quite the contrary. This is falling on the already horribly overtaxed middle class of Canada.

It is interesting to note what was said by some government members about bracket creep when they were in opposition. I remind those members of what they said by quoting from Hansard .

Who do we suppose said the following? This individual was referring to the Tory finance minister, Michael Wilson:

He said lower taxes. He told us there were no tax increases in this budget. That statement is false because taxes are going up in this country because of the deindexation of deductions which this government has done in its past budgets. The government knows it is going to get more money this year as a result of the removal of the indexation provisions on all deductions in the Income Tax Act and the removal of indexation on the rates of tax on various levels of income. Those have all been taken out so taxes will go up this year.

That is a quote from Hansard of April 28, 1993. I am sure the House will recall that individual, the Liberal member of Parliament for Kingston and the Islands. It was you, Mr. Speaker. Back in 1993 you recognized that bracket creep was a sneaky way in which governments, at the time the Tory government, could increase taxation on the already-

[Marlene Catterall, Liberal, Ottawa West, ON]

Mr. Speaker, I rise on a point of order. I am extremely concerned about the direction the debate has taken. There were approximately 84 Liberal members of Parliament in the last Parliament, any one of whom could be quoted.

I trust the member is not trying to drag the Speaker off his neutral throne at the head of this Chamber and into this debate, but I am afraid that is the effect his comments are having. I would ask you to rule on whether he may in fact quote the Speaker who is now occupying the chair as part of his debate.

[The Acting Speaker (Mr. Milliken)]

I appreciate the kind words of the deputy government whip but I am always pleased to be quoted.

The hon. member has a few seconds left for his remarks. I would appreciate it if he could conclude quickly as his time has expired.

[Jay Hill, Reform, Prince George—Peace River, BC]

Mr. Speaker, I was merely referring to the fact that back in 1993 you recognized this as a form of increase in taxes. I was merely applauding your insight.

What Canadians are telling us today is clear. It is Liberal-Tory, same old story, when it comes to taxing, taxing, taxing.

[The Acting Speaker (Mr. Milliken)]

I thank the hon. member. I appreciate the new term bracket creep, which I do not recall using and do not recall hearing before. It was a delight to hear it.

Resuming debate. The hon. member for Saint-Jean.

[Claude Bachand, Bloc, Saint-Jean, QC]

Mr. Speaker, I would like to speak-

[The Acting Speaker (Mr. Milliken)]

I am sorry. It is the other party's turn to have the floor.

[Claude Bachand, Bloc, Saint-Jean, QC]

Mr. Speaker, I thank you for being absolutely neutral, as you have just shown us.

I am pleased to address Bill C-92 which, as we know, is a ways and means procedure to implement certain measures announced in the 1996 budget. That 1996 budget was yet another opportunity missed by the government to put its fiscal house in order and to make things somewhat more equitable.

That budget was yet another missed opportunity by the government to review the corporate tax system. In order to put things off for a while and to make sure that corporate taxation would not be reviewed too soon, the 1996 budget provided for the creation of a technical committee. However, we recently learned that the mandate of this technical committee is now being extended until the end of 1997. Once again, the government is playing it safe, given the upcoming election campaign.

As the official opposition, we have a duty to point out these things, and we will definitely do so during the election campaign.

What did the government do to postpone this tax review and to make sure things remain unfair, as they currently are? It set up a technical committee. That committee is made up of people from the top consulting firms, people who are in the know and who try to make sure large corporations do not pay their fair share of taxes.

I consider that a bit like putting the fox-or Colonel Sanders-in charge of the henhouse. The chickens, that is the people footing the bill, are told "No problem, chickens, we have everything under control. The good old Colonel will look after everything".

But we have a major problem with that. The people advising the minister, advising the government, are just about in a conflict of interest situation. They will not be able to come up with solutions which might put their own clients in an awkward position.

We understand that this is a stalling tactic, to ensure that the tax contribution by the major corporations is not looked at too soon. In this connection, my hon. colleague for Bourassa referred to the situation with the banks, which I feel has become scandalous. At the present time, bank profits are in the billions. Yet they are rushing to lay off as many bank employees as they can. There are virtually no measures proposed to reform the taxation system, to get these banks to pay a bit more of their fair share.

And what is the situation in the meantime? The ones who are getting richer in Canada are the bankers; the ones who are getting poorer are the middle class. Everyone is contributing to support the state except the major corporations, which are making a small contribution, but far from enough.

Another thing that is in the 1996 budget which Ways and Means will focus on is the venture capital corporations. This is another example of Quebec's distinctiveness. Unions such as the CSN with its action fund and the FTQ with its solidarity fund make it possible for people to invest a little more venture capital. This was a first of its kind when it started up.

The central labour bodies said: "We are going to get together with people, with workers who want to put money in a pension plan for their retirement and arrange it so that we can provide venture capital and maintain jobs". Often, when companies are short of cash, the solidarity fund or the CSN action fund will provide assistance, helping not only to create jobs but often to maintain them.

So what did the government do? In 1996, the government decided to reduce the tax credit it had introduced which had been an incentive for workers to put money into the solidarity fund because they would get a more substantial tax refund. Probably when the government saw this incentive was too successful-not as successful as the banks, but they did not touch the banks, they hit the labour-sponsored venture capital corporations-the government decided to reduce the tax refund, which meant reducing the tax credit. Furthermore, there would be a ceiling on the amounts people are allowed to pay into these funds.

I think that was a pretty low blow, because we had workers and employers who were encouraging the public to do something socially responsible with their money, to use the money as a lever to create and maintain jobs.

Of course the government made cuts all over the place, and I think this is deplorable. As usual, when decisions like that are made, it seems that Quebec is hardest hit because 50 per cent of the money in these venture capital corporations in Canada comes from

Quebec. In other words, the government missed an opportunity to let this type of fund expand. It would been far better, as I see it, to set up a committee that would really do something about making the system more equitable as well as doing something about those who have all the capital, in other words, the banks.

Another ways and means motion about to be implemented is the unemployment insurance fund heist. You will recall that in 1996, the fund had a surplus of $5 billion. Employers and employees make a contribution. Studies show that each time the contribution is reduced by 10 cents, up to 30,000 jobs can be created. It was maintained and artificially raised over the years.

Naturally the minister decided this year to lower it by 10 cents. Will he create 30,000 jobs? I think so. But he had plenty of room to lower it much more than that and yet he did not. Why? Because he is taking the surplus from the unemployment insurance fund and paying off the deficit with that. Who is bearing the cost? Workers and employers, as I said.

Finally, it almost amounts to an indirect tax, and the government is benefiting from it. Why is it benefiting? Not just because the employers and employees are paying, but also because it is tightening eligibility requirements and ensuring it is making people poorer and hustling them along to the welfare rolls. That is what is happening.

If we look at the statistics since the Liberals formed the government, the number of unemployed in Canada declined from 1.6 million to 1.5 million. The 100,000 no longer receiving unemployment insurance have probably thrown themselves into the clutches of welfare, which is under Quebec's jurisdiction.

And so, on the subject of the unemployment insurance fund, it is totally deplorable that the government is not settling the matter by ensuring further improvements to the system and using the money to try to create jobs. It is not necessarily a question of giving the money to the unemployed, but some effort must be made to create jobs. But the government is not trying to create jobs; instead, it is using the surplus to pay off its deficit.

In terms of the unfair tax system, the same thing is true. I talked about it to some extent earlier, but we can also talk about family trusts. There are also large corporations that do not pay tax. When asked when it intended to be pay its overdue taxes, which it used to defer, Consolidated Bathurst replied: "Never".

I suggest that the taxpayers who are working on their income tax returns write on those returns that they never intend to pay the money they owe the government. I suspect Revenue Canada will get back to them in a jiffy and say: "Look, you must pay your taxes and they are overdue. There is a penalty for not paying and you will be charged interest on top of that". But justice does not mean the same thing, depending on whether you are a large corporation or a middle or low income taxpayer.

Family trusts are another case in point. The government never managed to settle this issue. There is some mention, in a ways and means motion, of a possible deferral over time that would shorten the length of time, but what does this mean for family trust owners? It means transfers. Family trusts are still there to transfer. They are transferred free of tax, benefiting once again rich financiers. The poor and the middle class cannot afford to establish family trusts for their young children.

This is unfair all the way. There is also the $7 billion in federal expenditures that has been shovelled in the provinces' back yard with the last two budgets. What this government should do is listen to what the Bloc Quebecois is proposing to settle the personal versus corporate income tax issue. This is $7 billion that can be recovered.

Unfortunately, the government is not listening to what we are saying, but we will make a point of bringing this up during the election campaign. This will all be settled in the next federal election. In Quebec, the voters will send a clear message to the Liberal government, which has strayed off course, and this will all be settled in the polling booth on June 2 or 9, probably.

[Marlene Catterall, Liberal, Ottawa West, ON]

Mr. Speaker, I was very pleased to hear the Reform Party member who spoke last acknowledge that Canadians are responsible for the very positive gains that have been made in terms of putting the economy of the country on a sound footing.

That is something that members of our caucus, our cabinet ministers, recognize very strongly. The Prime Minister has spoken about it. The finance minister has spoken about it.

They are the considerable sacrifices that Canadians have been asked to make and the understanding we have had to seek from them for some of the program cuts made over the last few years to bring our deficit, finally, from over $42 billion down to under $20 billion, heading to under $10 billion for next year.

The member spoke about growth in the economy and somehow seemed to think it a sin that with growth in the economy the government would be collecting more taxes. It is quite obvious that if there are a larger number of Canadians who are working, and there are close to a million more Canadians working now than were working three and a half years ago, more people earning, clearly

there will be more people contributing to the cost of running the country and delivering the programs that Canadians value.

The member should also ask himself why we have enjoyed the growth in the economy that he has acknowledged. He talked as though lower interest rates are something the government should apologize for. We do not.

Those lower interest rates have contributed tremendously to the growth in the economy that the nation is enjoying. It is because of the good fiscal management that this country has had for the last three years since the October 1993 election.

I want to acknowledge that the Reform Party did, in the last speech, speak about the growth in the economy. We appreciate those comments about low interest rates.

One of the items in the bill before the House today is the taxation treatment of child support. This bill changes the taxation of child support. The change is part of a larger package of reforms to deal with child support. The reforms include measures to try to address the problems of inconsistent child support payments, inadequate child support payments, support payments that often are not paid at all, intermittently or inadequately.

The three reforms include the introduction of the federal child support guidelines to establish fair and consistent support awards in divorce cases. In addition, there is the enhancement of federal and provincial enforcement measures so that those awards decided by the courts would be paid. Finally, the item this bill deals with primarily, there is a change in the way that child support awards are taxed.

Let me take a few minutes to explain how we have changed the rules and why. Traditionally support awards have been tax deductible to the paying parent and taxable as income for the parent receiving the payment, i.e., the custodial parent who also has the responsibility for the day to day care of the children.

The 1996 budget announced that this system would be replaced with a system of no deduction, no inclusion. Perhaps some members need to be reminded that this is in line with the court decision delivered not that long ago that the practice of allowing the parent paying child support payments to deduct the payments before paying income tax and having the parent receiving it pay the tax on that amount was unconstitutional and contrary to the charter of rights and freedoms.

To suggest that the government should not somehow be dealing with that and correct a provision in tax law that is contrary to the charter and to the Constitution of this country goes a bit beyond the ridiculous.

That is what we are trying to do. The court simply said that if we have two parents, both of whom are supporting their children, if one is still married to the other parent, they pay tax on that money, but if one is divorced from the other parent, they pay no tax on that money. That is discriminatory between parents who are married and parents who are not married. Quite simply that is the issue we are trying to address here.

In theory the old system could deliver a tax benefit that would make more money available to the children. That is because the paying parent usually had a higher income than the recipient or custodial parent and therefore was taxed at a higher marginal rate. If the paying parent saved money, that saving could in theory be passed along to the children.

In practice that is not what happened. The system failed to deliver this benefit and actually made it harder to set fair and realistic awards in the courts. The system was fraught with a host of frustrations that were reflected in the well known case of Suzanne Thibaudeau, which I have just referred to.

For one thing, the tax benefit was not targeted to reach children who needed it most, and complex tax calculations made it more difficult for parents to negotiate a realistic level of support that they both saw as fair. Many parents also found that waiting until year's end to receive a refund or to make lump sum payments created serious cash flow problems for both parents.

This package of reforms we have made including the tax measures in this bill is the result of a supreme court decision but also the result of cross-country consultations held under the auspices of my colleague, the member for Mount Royal, in which we heard the real life experiences of families that had broken up, what was happening to children, what was happening to their parents and the real poverty created by the existing system.

The Vanier Institute's last report found that two-thirds of women whose marriage breaks up walk out of the marriage and into poverty. That means their children walk with them. That is part of what we are trying to address by these reforms. It is part of the reason for this change in tax policy with respect to taxation of child support payments. It is a measure that is legally necessary but it is also necessary in justice and in fairness and putting the concerns of our children and their well-being first.

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, normally I stand up to say that I am pleased to join in the debate on Bill C-92, but you did hear the point of order I raised earlier and the fact that Standing Order 73(1) has now become a time allocation standing order rather than a standing order that has real meaning. If we followed through with the real moral intent of the standing order we would never be having this time allocation today.

I know the Speaker has ruled, not in our favour and we do not feel he ruled in favour of the people of Canada, but certainly on a narrow interpretation-

[The Acting Speaker (Mr. Milliken)]

I hesitate to interrupt the hon. member, but he knows it would be improper to reflect on a ruling of the Chair. I thought he was moving off that subject, quite smartly, as I had sort of cautioned him to do. I invite him to move off the subject immediately. I think it would be unwise to continue this line.

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, Bill C-92 deals with a budget measure of 1996. It is now April 10, 1997, 14 months since that budget was tabled. The legislation is just now being introduced.

I have a couple of children, one attending university. I saw that I was getting an extra deduction for his education. It has gone from $60 a month for full time attendance at university to $100 a month for full time attendance. I thought it was not bad, but I wondered when it went through. It is going through today. Here it is. Now we know why the government is in such a rush. It is here in Bill C-92 after I did my income tax. After millions of Canadians have done their income tax we now find that the legislation is coming along like the tortoise after the hare. Unlike the tortoise, it does finish first and causes the income tax returns to fall into line, if I may say.

Going through the summary of the act, it is complex and detailed. There are tax credits for individuals, charitable donations, child care expense deductions, child support payments, deferred income plans, foreign reporting rules, non-resident pensioners, all by and large things that are somewhat beneficial to individual taxpayers.

Then I read on, scientific research and experimental development. It introduces a salary cap for SR and ED treatment of salaries of specified employees. This is a tax limitation on a tax break that corporations can get.

No. 9, labour sponsored ventured capital corporations. It reduces the tax credit rate from 20 per cent of the cost of the LSVCC share to 15 per cent, another restriction on tax breaks for corporations.

No. 10, flow through shares. It extends the look back rule to allow qualified expenses incurred at any time in taxation year to be treated as if they were incurred in the preceding years, again a reduction in benefit.

No. 11, resources losses requires an add back to income or 25 per cent of prescribed resource losses, another one that increases the tax liability of corporations.

No. 12, Canadian field processing excludes gas plant processing from activities eligible for the manufacture and processing tax credit, another situation where businesses will pay more tax.

No.13, joint exploration corporations, repeals rules allowing for the renunciation of resource expenses by joint exploration corporation, another situation where corporations will pay more tax.

No. 14, part 6 capital tax, extends the application of additional part 6 tax by one year for banks and other deposit taking institutions and by three years for life insurance corporations, another extension of a tax on corporations.

The minister stood up and said he has not raised taxes. Right here is Bill C-92, coming from the budget of February 1996. Fourteen months later we now have the legislation in front of us. There it is, tax increase, tax increase, everywhere business turns there is a tax increase, all the while the government throws a few shekels to individuals. The government seems to think that there is no limit to how big business can pay more tax.

That is despicable. Who creates the jobs in this country? Business of course. How can business create jobs if they are being taxed into oblivion? That is what the government is doing. It is taxing business into oblivion.

The employment insurance program is turning out to be nothing but a blatant tax grab by the government. According to the latest numbers I saw in the "Fiscal Monitor", the government will run a surplus on employment insurance premiums that exceed benefits paid out under employment insurance by approximately $7.5 billion. That is a $7.5 billion surplus in one year.

The government has dramatically cut back the eligibility of individuals for employment insurance. It has cut back the amount of employment insurance it pays to individuals who manage to qualify. It has made a pitifully small decrease in the amount of premiums paid by individuals and employers. In the course of doing all that up comes the surplus. As more money is coming in and less money is going out, away the surplus goes. The Minister of Finance is taxing business to the point that it cannot create jobs. Then he stands in the House and says that unemployment is still over 9 per cent and he wishes it were coming down. He does not know why it is not coming down. Let me tell him.

If he looks at Bill C-92 he will find out why the unemployment rate is not coming down. There are extra taxes for business under the scientific research and experimental development program, extra taxes for business under labour sponsored venture capital corporations, extra taxes on flow through shares, extra taxes on resource losses, extra taxes on Canadian field processing, extra taxes on joint exploration corporations and an extension of the capital tax for banks and insurance companies. We cannot have our cake and eat it too. That has basically been the rule with Standing Order 73 excepted.

The Minister of Finance thinks he can tax these businesses into the ground and then turn around and say it is their responsibility to create all these jobs. It is time the minister had a few economic lessons from somebody. It just does not work that way.

Let us look at the benefits he has given to individuals. He has made changes to the child care expense. People can now claim child care expenses for people aged 16. We throw young people into young offender institutions long before they are 16. I wonder if that would qualify for a child care deduction. It is an interesting thought: a 16-year-old going off to day care with a lunch bucket in his hand and holding his mommy's hand too. I can see it now.

The government is going too far in thinking it can buy votes from individuals and in taxing businesses into oblivion. I will leave it at that.

[Benoît Sauvageau, Bloc, Terrebonne, QC]

Mr. Speaker, before discussing the ways and means motion on the previous budget, I would like to take a minute to thank some people from the new riding of Repentigny.

You referred to me as the member for Terrebonne but, after June 2, that is after the next election, the Speaker who will be in the Chair, and I hope it will be you, will have to refer to me, assuming I am re-elected-but I am not overly concerned about this, since things are going very well in our riding-as the member for Repentigny, the first one to represent this new riding.

In a few years, if things go well, I will have become the first and last member for Repentigny, because that riding will not have a very long life. It will go through only three stages: first, the election of the Bloc Quebecois; second, the election of the Parti Quebecois; and third, the holding of a successful referendum. It will be a tie-breaker after the dead heat we had the last time. Therefore, the riding of Repentigny will exist for only a few years.

My nomination meeting was held yesterday evening, in Charlemagne, one of the municipalities in that beautiful riding. On that occasion, people expressed their confidence in me by agreeing to let me represent them at the next election, as a Bloc Quebecois member. Therefore, I sincerely thank the people of Repentigny, Charlemagne, Lachenaie, Mascouche and La Plaine, for their support in the past three and a half years, and for their renewed support last night in Charlemagne. Over 150 people were in attendance and showed they are eager to get on with the next election campaign.

[Some hon. members]

Hear, hear.

[Benoît Sauvageau, Bloc, Terrebonne, QC]

Now we are going to get to the heart of the matter, the ways and means motion for last year's budget.

I would like to quote from a book that I am sure you all read regularly a few years back, and that you were only too keen to forget about once we had read it too. I am talking about the red book. We are still waiting for the second volume, the one on promises kept, which will perhaps be as thick as this piece of paper. I would therefore like to quote from the red book. I will read what my friends across the way said on page 13:

Today, after nine years of Conservative government, Canadians are facing hardship: 1.6 million unemployed, millions more on welfare, a million children living below the poverty line, record numbers of bankruptcies and plant closings.

I repeat, this appears on page 13 of the red book.

What has become of the fine words of the Liberal Party, of the compassion that we read about in the red book, but that never actually materialized, because in concrete terms we have seen nothing? What have they done after three years? We will give figures, but not the Bloc Quebecois's figures, because as our friends across the way tell us, the nasty separatists tend to play around with figures. We will therefore give figures provided by Statistics Canada, Industry Canada and Human Resources Development Canada.

So, instead of the 1.6 million unemployed Canadians they complained about in the red book in 1993, there are now, according to Statistics Canada, 1.5 million Canadians without jobs. In 1993, they wrote about "millions more on welfare", but Statistics Canada tells us there are now 3 million Canadians in this situation.

Instead of "a million children living below the poverty line", as they told us in 1993, Statistics Canada reports that there are now 1.5 million such children, 500,000 more than before.

In 1993 they wrote in the red book about "record numbers of [-]plant closings"-they did not give a figure because it was not true-while today Statistics Canada tells us there were a record 86,253 bankruptcies declared between January and November 1996.

Before speaking about the budget, it is very important to remember the compassion expressed by the Liberals in 1993, and the failure of the Liberals to take action since that time. The figures in the finance minister's budget can be interpreted any number of ways, as the secretary of state just demonstrated, and as other government members have shown, in trying to praise this government and cover up mistakes in the budgets and this government's failure to act or its blunders when it did.

We could also go on about a number of things, a number of critical sectors of our economy, our society, our culture, our history and our trade. I believe that the most important figures, the ones that will really make the public sit up and take notice in the next

election are these: the unemployment rate, the poverty rate, and the bankruptcy rate.

Before having a firm political ideology, before having intentions, projects, hopes, we need a bare minimum, that is to say enough money to realize our ideology, or enough money to realize our hopes and dreams for the future.

With a record as pitiful as 3 million people on welfare, 1.5 million children living below the poverty level, according to Statistics Canada, I do not believe the Liberals can pat themselves on the back and boast "We are proud of our performance record. We can present you with a budget and describe it as having successfully bolstered the social and economic fabric of this country". This is false, and who says so? Not us, but-I repeat-Statistics Canada, Industry Canada and Human Resources Development Canada.

The government could, perhaps-and I suggest it do so, as it has in other sectors-tell us that the head of Statistics Canada must be wrong, that he ought to be sacked, that someone new should be hired who could change the figures. We know that is a Liberal tactic. They would put a good Liberal in charge, a few figures would get changed, and then something more attractive could be reported.

Unfortunately for the Liberal Party, and fortunately for us and the man or woman in charge of Statistics Canada-I do not know which it is-this tendency, or way of doing things, from the past is no longer in use. The chief statistician and the heads of the other departments I mentioned will be able to stay put and keep giving the real figures, the results of this government's failure to act.

As I said before, the government has nothing to be proud of in this respect, and I think it has an obligation to explain these results to the public. Meanwhile, what was the Bloc Quebecois doing? Was the Bloc Quebecois, as an opposition party, shooting down everything that moved? In a way yes, but in another way no.

Yes, the Bloc Quebecois objected to various bills that were introduced and that, in our opinion, were skewed towards these figures. But at the same time, the Bloc Quebecois made certain proposals. We offered both negative and constructive criticism. So what did we propose? We proposed a plan for corporate tax reform and another one for personal tax reform.

In the new riding of Repentigny, if the Minister of Finance bothered to listen to us and realized that the proposals made by three excellent researchers of the Bloc Quebecois, not the slew of researchers that can be found at the Department of Finance, if he bothered to consider and implement the recommendations we made, he would realize that what is needed is not new money or an increase in the deficit. By reallocating amounts that are already in the tax system, an average family-for instance, a Repentigny family of two adults and two children with an average income of $40,000, these are not wealthy people, this is an average, modest income-if the Minister of Finance were to implement the proposals of the Bloc Quebecois, this average family in Repentigny would pay $821 less in income tax. This proposal would affect more than 50 per cent of the families in my riding.

Unfortunately, this family will have to pay $820 more in income tax because of poor decision making by the Minister of Finance. It may not be a lot, but for the average family with a modest income of $40,000, this is a lot money that could be funnelled back into the economy and could create real jobs.

However, the Minister of Finance has trouble going along with proposals made by an opposition party, a party that objects when something does not make sense, but also makes suggestions on how things should be changed in the interest of fairness.

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, I rise on a point of order. Is the order of debate from the Bloc to the Liberal Party and then back to us under this order? Should a Reform member not be the next speaker?

[The Acting Speaker (Mr. Milliken)]

The last speaker before the hon. member for Terrebonne spoke was the hon. member for St. Albert.

The rotation today has been from the beginning I am advised- and I was not here at the beginning of the debate-Liberal, Reform, Bloc. That is the way it has been going. It is now a Liberal's turn. Accordingly I recognize the hon. member for Haldimand-Norfolk.

[Bob Speller, Liberal, Haldimand—Norfolk, ON]

Mr. Speaker, it gives me great pleasure to say a few words on Bill C-92. I know I only have a couple of minutes to speak to the budget. It is a budget that I think is notable.

I want to say a little bit about rural Canada and the impact this budget has in the rural areas. Rural Canada is an area that has really been recognized for the first time in a budget by a government that directly looked at solving some of its problems.

In the speech from the throne the government made a commitment to look at rural Canada and to try to make sure that it shares in the economic growth that is happening across the country. I would like to thank all our members from the rural caucus in the Liberal Party and the Minister of Finance for taking the opportunity, after listening to our concerns, to address some of the concerns that we have in rural areas so that we too can share in the economic growth in the country.

I want to highlight a few areas that the minister has touched on. One of those areas deals with the Farm Credit Corporation. He

made sure that the Farm Credit Corporation had more money in which to invest in rural areas.

The trade statistics show that agricultural exports have increased some 30 per cent over the last three years. We seem to be booming in exporting our products. One of the areas in which we need to do more is to make sure that the further processing of goods, especially in the agricultural area, can get to the export market. In order to do that the farmers, who have a lot of really good ideas, need some cash to invest in these products and to get them into the market.

On the one hand the Minister for International Trade has done a good job in getting the information out to these small businesses, these farmers, and to make sure that they are represented in our embassies around the world and that their product is there.

On the other hand, the Minister of Finance has made sure that cash is there. He has made sure that the Farm Credit Corporation has cash available to help invest in these small industries to make sure that they can get up, get running and get these further processed goods exported around the world. I want to thank him for that.

I would like to highlight a point that the hon. member for Parry Sound-Muskoka was pushing very strongly and I know the Minister of Finance thanked him for that, and that is the whole of tourism and the importance of tourism to job creation in Canada. The rural areas have a lot to show. A lot of tourists come to the rural areas but there is not as much co-ordination and there are not the groups in place to help co-ordinate a tour group or a tourist who comes in to certain parts of Canada.

The Minister of Finance in his wisdom and the cabinet agreed to put some money into tourism. I know all hon. members will agree it does a lot in helping to create jobs, especially in small tourist operations in rural and remote Canada.

Obviously education and health care were in the budget. These areas are important for rural Canada. I want to thank the minister for investing in the Internet and making sure that we in the rural areas are up to speed so to speak in having access to the Internet.

In fact our young people and our students can now in any community with a population of over 400 have access to the Internet. That is a very important initiative of this government that really helps in making sure that people in rural and remote Canada can get into the new technologies that I think are going to be important in rural areas in terms of job creation.

It is also important to note this. I want to talk personally about my riding of Haldimand-Norfolk and the importance of taxation. In my nine years here, it seems that every year, the Minister of Finance has come up and once again increased the taxes on tobacco.

I want to thank him from my constituents' point of view for not raising the taxes on tobacco in the budget. As members know, to tobacco farmers in the community surrounding my area, the size of tax on tobacco is important, although not on the sales. It does not have a big influence in the production, but in giving them a good feeling and understanding of how the system works.