House of Commons Hansard #7 of the 36th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was debt.


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4:40 p.m.


Susan Whelan Liberal Essex, ON

Mr. Speaker, I appreciate the hon. member's question. As he knows, we are not borrowing any money right now to meet our budgetary requirements. In fact, we will balance the budget no later than the fiscal year 1998-99. We stated that when the books are balanced and when we find ourselves in a budgetary surplus then we will split whatever budgetary surplus is there 50:50 within our fiscal framework.

I will tell members what I told my constituents and those people who voted in the 1997 campaign in my riding. I told them that this is the first government in 30 years to be able to say we will balance the books, and this government will maintain our fiscal track record. At the same time, this government is compassionate and recognizes that there are social and economic priorities far beyond tax reductions. We will ensure that all Canadians are treated fairly, and I will stand on that record.

I am sorry the member for Elk Island does not recognize there are social and economic priorities and not just tax reductions.

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4:40 p.m.


Gilles-A. Perron Bloc Saint-Eustache—Sainte-Thérèse, QC

Madam Speaker, I wish to advise you that I will be sharing my time with my worthy colleague from Joliette.

I am pleased to be here today, Madam Speaker, and to wish you good luck. I congratulate you on your appointment to your new position.

I would like to say how proud I am to be the first sovereignist member elected in the new riding of Saint-Eustache—Sainte-Thérèse.

I would also like to take the opportunity to thank all the voters in my riding who enabled me to be in this House. I would especially like to pay tribute to my family and to the hundred or so volunteers who worked so hard throughout the campaign. Without their support, the results might have been different. I firmly intend to vigorously defend their interests and those of the people of Quebec, whatever their religion, their language, their culture or their country of origin.

I come now to the motion before us. Like all my colleagues in the Bloc Quebecois, I must say I support the government's objective of eliminating the federal deficit by the year 2000. However, I disagree totally with its means to this end.

Fifty-four per cent of the cuts were to provincial transfers. In the end, thousands of people paid the bill, and the provinces bore the political pressure. And with this money it has saved on the backs of the provinces, the federal government is now going to finance new initiatives in areas of provincial jurisdiction, such as literacy, university and hospital research infrastructures, etc.

Our friends across the way have got it all worked out to fool the public. I am not making this up. The current President of the Treasury Board gave it away when he told Le Soleil on March 8, 1996, and I quote: “When Bouchard has to make cuts, we in Ottawa will be able to show that we have the means to preserve the future of our social programs”. This is nothing but demagoguery, the kind of deceit that hurts the most disadvantaged and the workers who foot the bill.

This is how we, the Quebec people, have been forced in recent years to help lower the federal deficit, to the tune of 72 cents on every dollar contributed.

It is all so much trickery, like using the five billion dollars—five billion, that is 5,000 million dollars—from the employment insurance fund to reduce the federal deficit. Not only has the federal government failed to create the jobs it promised in its red book, but it has used the unemployed to reduce its deficit.

In addition, by changing the eligibility requirements for employment insurance, the federal government is forcing unfortunate unemployed workers onto welfare, with no regard for how terribly traumatizing this can be.

As for the increase in tax revenues, where does the money come from? Certainly not from the wealthy taxpayers who take advantage of tax havens, but rather from the middle class, whose tax burden is getting heavier and heavier.

The Liberal approach to putting our fiscal house in order is totally unacceptable. Year after year, the squandering of billions and billions of dollars by the federal administration is denounced in the auditor general's reports.

Yet, during the election campaign, the Liberals promised they would root out waste. Did they deliver on their promise with our dear heritage minister's one million flags and the television propaganda from all government departments? I wonder how much it has cost the government to tell Quebeckers: “We love you. We love you”.

Four years later, the people of Quebec and Canada as well as the auditor general are still waiting for this shameful waste to stop. But the Minister of Finance is skirting the issue because he obviously does not want to cut in that area as he does without hesitation in social transfers to the provinces.

It is not as if he did not know what the people want. I sent him a copy of the August 26, 1997 resolution the City of Saint-Eustache sent to the Prime Minister of Canada, informing him of its opposition to the federal government's cutting transfers to the provinces without reducing taxes by the same amount. This resolution comes from the City of Saint-Eustache.

Departmental spending was cut by 9 percent even though, in his 1995 budget, the Minister of Finance had promised to cut it by 19 percent. More empty promises!

The Liberals are incapable of honouring their commitments, and I still wonder just what gives the Minister of Finance cause to boast? Next year's budget surpluses will be attributable to the efforts of Quebeckers and the provinces. It is therefore his duty to distribute them equitably.

Given what I have just said about the government's mismanagement, my party and myself consider his announced 50/50 policy to be a crock. Investing 50 percent of the surpluses in social programs and using the other 50 percent to reduce the debt and taxes is unacceptable.

Under this formula, the federal government is perfectly free to spend the surpluses in areas of provincial jurisdiction.

We have examples already, with the announcement by the Prime Minister of a $1 billion merit scholarship fund. We must not be fooled. This $1 billion was taken from cuts in transfer payments for higher education.

Here is what the taxpayers want. And this is what the government must do: first, return $5 billion to the provinces; second, stop borrowing wholesale from the employment insurance fund; third, lower the rate of contributions to the employment insurance fund; fourth, increase the benefits that were drastically reduced in 1997 under the new employment insurance plan; and fifth, stop all intrusion into areas of provincial jurisdiction.

For these five reasons, no doubt different from those of the Reform Party, I will nevertheless vote in favour of their motion.

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4:50 p.m.


Brenda Chamberlain Liberal Guelph—Wellington, ON

Madam Speaker, there were a number of things in the hon. member's discourse that were inaccurate.

He talked about the fact that the Liberals have not been able to do much about unemployment. Indeed, we are not at a level we would like. However, in 1993 when I was elected a member of Parliament, the national unemployment rate was 12 percent. It is now stands at 9 percent and in my riding is at 7 percent.

It is important for the hon. member to understand that we all have to do our bit to help the unemployment rate and help the country. The Bloc should understand that Quebec is a part of Canada and that it is important for it to acknowledge the benefits it gets by being a part of Canada.

The member spoke about cuts in government. However, he did not talk about additional spending in retraining programs by the federal government which Quebec enjoys, in literacy, internship and mentorship and student programs.

I am sorry that the hon. member from Quebec does not acknowledge that Quebec enjoys the money sent to it.

It is important to also acknowledge the helping hand the Saguenay region received during the flood. Who helped? It was the defence department and the Canadian government. It is important for the member to acknowledge that to all of his electors.

About two weeks ago one of my staff members, who unfortunately is no longer with me, went to Montreal and had the opportunity to see many buildings and homes which had been vacated because, she was told, people are leaving Quebec because of the instability the Bloc is creating with the scare of wanting to leave Canada.

I would ask the member to acknowledge that the federal government did help during the time of the flood. The government did a very important constructive thing.

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September 30th, 1997 / 4:50 p.m.


Gilles-A. Perron Bloc Saint-Eustache—Sainte-Thérèse, QC

Madam Speaker, I think my friend opposite should come and visit Quebec.

For starters, just recently Intrawest invested $500 million in Mont-Tremblant. The member across the way thinks she is living in some dream world with unemployment in her riding at 7 per cent. In Saint-Eustache—Sainte-Thérèse, the rate is 14 per cent. In Matane, it is over 22 per cent.

We invest $34 billion in Canada so we are entitled to some compensation. Canada gave us some of that money back when Chicoutimi was struck by disaster last year.

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4:55 p.m.

The Acting Speaker (Mrs. Thibeault)

The member for Richmond—Arthabaska has the floor.

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4:55 p.m.


René Laurin Bloc Joliette, QC

Madam Speaker, are we having questions and comments, or resuming debate?

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4:55 p.m.

The Acting Speaker (Mrs. Thibeault)

Questions and comments.

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4:55 p.m.

Progressive Conservative

André Bachand Progressive Conservative Richmond—Arthabaska, QC

Madam Speaker, I will keep it brief.

If I understood correctly, our friends in the Bloc Quebecois are going to vote in favour of the Reform Party's motion. I do not know if opposites attract or what, but I have a question for the member.

If, in fact, the Bloc Quebecois agrees on a 50/50 share of the anticipated surplus, I would remind the member that there will be no surplus available before the end of the next term of office in four years' time, barring an earlier election.

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4:55 p.m.


Gilles-A. Perron Bloc Saint-Eustache—Sainte-Thérèse, QC

Madam Speaker, we simply do not agree with the government and it has nothing to do with the 50:50 ratio. It is simply a matter of redistributing surplus money equitably, as it should be.

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4:55 p.m.


René Laurin Bloc Joliette, QC

Madam Speaker, there is something surprising in this debate and in the Speech from the Throne presented by this government.

In its throne speech, the government makes a commitment: it is as if it was wondering just how it could keep on doing exactly the same thing it has been doing for the past 27 years while appearing to be doing something new. In other words, to keep on spending taxpayers' dollars to make them happy, gain votes, gain popularity or score political points at the expense of the provinces.

With budget surpluses within reach, the Liberal government is wondering if it could not carry on pleasing people, without their noticing what is going on.

It takes a profoundly irresponsible government to forget, as the Liberal government is doing, that, while the deficit could apparently be reduced to zero by the year 2000, this government, this country is still $600 billion in debt. A zero deficit does not mean Canada's debt burden has been made any lighter.

Since this government took office in 1993, the Canadian debt has grown by an additional $75 billion. It is one thing to say I now have enough money in my pocket to buy groceries, but I will have to use some of the money I will save to reduce the debt I accumulated over 30 years.

But right now, the Liberal government seems to be favouring a formula that would once again shift the responsibility onto the provinces, which would be left with the dirty job of making cuts in health, education and social programs because the federal government has apparently decided to use funds earmarked for the provinces to repay its debts.

If it wants to reduce taxes, ensure that social programs benefit taxpayers to a greater extent and see the taxpayers' debt at every level of government go down, all the federal government has to do is give back to the provinces the money it took away from them.

Let the government give back to the provinces the $4.5 billion in transfer payments it cut, and the provinces can then maintain their social programs. They can also then cut taxes.

But no. This is not what the federal government wants, because it wants the glory of being the one to give taxpayers the most. It wants to give the provinces the thankless job of making the cuts, and once they are suitably hated and detested by taxpayers, the federal government will ride in as the saviour and say to these taxpayers “The federal government, the best and strongest government, can now give you what the province denied you or deprived you of”. That is what is hateful about the situation.

This business started years ago. We need to look back at our history. When the federal government asked the provinces during the first world war for the loan of their power to tax directly, the provinces agreed to come to the aid of the nation at risk, to protect its future. However, the federal government hung on to this power, refusing to give it back to the provinces. The first theft, this country's greatest theft, started then, when it took over the power of taxation from the province, supposedly on a temporary basis, and never gave it back.

This is the power the federal government is now using against the provinces, selling its bill of goods about a strong government in Ottawa and a subservient one in the provinces. No wonder Quebec is now thinking of sovereignty, of autonomy. It is tired of having to play the heavy, the one to make the cuts to the taxpayer, while the federal government, because of the taxation power the provinces have given it to collect taxes in its stead, has equipped itself with a tool for making the provinces subservient.

The transfer payments, which should have been used to share the wealth and rebalance the means of meeting the needs of the population, are being used far more by the federal government at this time to make the provinces subservient to its centralizing domination.

The provinces, Quebec in particular, are tired of this situation. The government of Quebec wants to be able to tell its taxpayers that it is able to meet the needs of social programs, education, health, which are its responsibility, provided it has the taxes we are paying for that, and not just a portion of them with which it can meet some health needs, while the rest of the taxes go to the federal government so that it can say that it will also meet another part of health needs then leave it to the taxpayer to judge which of the two governments is doing a better job of fulfilling those responsibilities.

The same taxpayer is paying taxes to two governments at the same time. One too many governments is involved in this, and Quebeckers feel that theirs is not the one that is superfluous. They pay twice to two institutions, and end up exploited and with fewer services than they ought to have. Our federal government, with the Liberal Party at its head, ought to think first of all of saving money, instead of making more cuts and more expenditures, if it wants to have money to spare.

Recently once again, the newspapers have reported—and this was really not a new discovery, since the auditor general has been saying so since 1993, without the government doing anything about it—that the auditor general has spoken out against the fact that they are trying to put a new computer program in place for processing the old age and income security pensions.

In the beginning, it was supposed to cost some $260 million. Four years later, the cost has reached $365 million and the computer system is still not operational. The people in charge of setting up the system are poised to ask a further $150 million to do so, four years later.

The federal government has not seen fit to wonder whether it was on the right track. Are we on the right track with this computer system we are having trouble setting up?

Imagine, $500 million for something which initially was supposed to cost $260 million. The auditor general has mentioned it in his reports a number of times, but the government has done nothing about it. This is where money could be saved. This is where the government should have saved money instead of cutting transfer payments to the provinces to be able to act later on and appear to be a generous big brother, a kindly father willing to meet the needs of the nation.

Quebeckers can see through all that. So do Canadians as a whole. I believe maritimers, who also are faced with high unemployment and poverty, must be wondering what the federal government is waiting for to enter into partnerships with other governments, with the provinces. In this case partnership means “Here is the money we collected, take it and meet your taxpayers' needs in your areas of jurisdiction provided for in the Constitution”.

This is called showing respect and making better plans for the future.

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5:05 p.m.

Guelph—Wellington Ontario


Brenda Chamberlain LiberalParliamentary Secretary to Minister of Labour

Madam Speaker, my colleague talked a lot about the government having to cut in order to balance the books in some way.

Lately I have read with great interest about a past colleague of ours in 1993, when Mr. Bouchard was in this Chamber. He talked a lot about being able to do things magically, being able to balance books without having to cut back on services. I have since read an awful lot about the fact that Mr. Bouchard has had to make a lot of cutbacks. He has had to try to balance the books. As I understand it right now, he is falling dramatically in the polls. The support for separation and leaving Canada is not a popular concept any more in Quebec.

I wonder if the hon. member could tell me how he feels about the fact that his premier who has left here has had to go on and do the very same things to try to balance the books and make a better Quebec. It seems to me that my hon. colleague was speaking against the Liberal Party making cuts when in fact the premier of Quebec had to leave here to do the same thing.

Could we have a direct comment on Mr. Bouchard having so much difficulty?

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5:05 p.m.


René Laurin Bloc Joliette, QC

Madam Speaker, the difficulties of the province of Quebec, and of the other provinces as well, arise mainly from the fact that it has a revenue shortfall in what it was receiving from the federal government in the form of what were called transfer payments.

The cuts by the government of Quebec account for 54 percent; 54 percent of the cuts made are the result of transfer payments which are no longer coming from the federal government as they did in the past.

This is not surprising. It is as if, in a family budget, one parent required the other to clothe the children, but cut his or her budget in half at the same time. So something would have to be cut somewhere. Then, when the other parent is unable to meet the children's needs, the first one comes along to say “I will get you some fancy shoes and clothes, a nice hat, a nice dress”. So, of course, one of the two parents comes out looking good, but he or she has done this with the other's money, because only one of them has had to make any sacrifices.

What did this federal government, which was supposed to be cutting departmental spending by 19%, do? The fact is it has cut spending by only 9%. That is barely half as much as promised.

Instead of making the sacrifices it was supposed to make to reduce its deficit, the federal government had the provinces make them, asking that they do without the funding they used to receive from the federal government in the form of transfer payments. The government asked them to do without so it would not have to do without too much itself and have fewer cuts to make. No wonder the provinces are experiencing difficulties now and having to make cuts.

See what is going to happen. As one of my colleagues pointed out earlier, Mr. Massé made a statement to that effect. At a time when the provinces are experiencing difficulties, the federal government is blessed with a better than expected income and is about to start playing Santa Claus again because there is a provincial election coming in Quebec, and because that election will be followed by a referendum. To have the taxpayers believe that their future, comfort and security depends on it, the federal government will try to start investing again in health, education and social assistance, all of which are areas under provincial jurisdiction.

That is what the federal government will do. Every time the provinces put their fiscal house in order, the federal government steps in. The government is responsible for every deficit in the past 30 years. The provinces also had deficits, but the federal government failed to play its role properly. That is why today we are speaking in favour of the motion put forward by the Reform Party.

We do not necessarily agree with everything the Reform Party said on this issue, but we agree with the principle of distributing surpluses, because we want them to be distributed differently and, on that basis, we will give our support.

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5:10 p.m.


Alex Shepherd Liberal Durham, ON

Madam Speaker, congratulations to you on occupying that chair. It is a pretty face to see.

This is my first intervention in the 36th Parliament and I would like to thank the people of Durham who graciously have decided to send me back to the House.

We have been debating the Reform motion which refers to the returning to the last 27 years of our history. This is rather absurd because the reason we are here today debating the motion is the diligence the government has had toward its fiscal agenda to reduce the annual deficit. In my lifetime I do not remember another finance minister who not only set and met the targets but exceeded them. It is because of the orientation the government had toward its fiscal agenda.

It seems rather absurd to me that the second party is now thinking that somehow we are going to change all that again. The agenda is very clear in my mind. We are going to continue to keep our fiscal house in order.

There is some room to manoeuvre. This will be the first year in which we do not have any positive net borrowings in the capital market to support our annual expenditures. In future years we will be able to reduce not only the deficit but will also make a positive contribution toward reducing our outstanding debt.

I welcome the debate because it is very important to question what is a fair level of total debt. At approximately 75 percent of our gross domestic product the current level of debt is inoperative and must continue to come down. I believe most parties can agree with that.

Second, the throne speech clearly talked about tax cuts. Most of us will agree that Canadians are fairly heavily taxed and that they are probably entitled to some kind of rate reduction in the future. The operative word is future. More important, what is the nature of the tax cut? How is it physically done?

This whole debate talks about spending. The motion of the Reform Party talks about irresponsible spending as though we all know what it is. According to Reformers all spending, as far as I can understand from listening to them, by the government is somehow bad. It is very simple.

It is very interesting to be in the 36th Parliament because we have another group of parliamentarians at this end of the House who stand day after day and say that all spending by government is good. It is interesting to sit between these two arguments and try to find out what makes any sense.

Time and time again member after member of the Reform Party says that money in the hands of consumers is far better than money in the hands of government. I have heard their speakers suggest from time to time that we also live in a period of high consumer bankruptcy. It may actually occur to members that some people in society spend too much. The negative impact is the consumer bankruptcies that occur.

When we talk about tax cuts I am very interested in exactly what we are talking about. We are talking about rate reductions. The income tax system in Canada is called a progressive system. As income increases, tax rates also increase. This is something that has been accepted in Canada for a long time.

I have heard the Reform Party indicate from time to time that everybody should have a flat tax and everybody should pay the same. That is a reallocation of taxes from the wealthy to the middle class. That seems to be part of its agenda as well, although I have not heard much about it in this parliament.

When we start talking about how to direct a tax reduction in a progressive taxation system, we have to take into consideration that the people who will benefit most are the very wealthy, which is why the Reform Party supports that group of people.

There is another point missing from the debate. When we start talking about tax cuts and hitting higher income groups more efficiently, we do not consider the demographics of our population. Everyone knows that Canada's population is aging. Almost a third of our country consists of what we call baby boomers, of which they tell me I am on the leading edge.

If baby boomers today were given a choice and were told that they would be given an extra dollar from taxes, chances are they would save if for their retirement. That is not so bad. That is good because we know we are having trouble with some of our retirement programs as well.

The reality is that tax cuts will not necessarily lead to job growth. There is no stimulation in the economy by people who simply save and do not go out and spend.

In other words, there is a great elasticity. We may well give more money back to people, and well we should. I believe our rates are too high. However the argument does not follow that somehow the economy will be stimulated and jobs will be created.

We have a premier in Ontario who ran a whole election based on giving a 30 percent rate reduction across the board. Of course what happened is that most of it went to the same group I am talking about, the relatively wealthy, sometimes and often the baby boom population.

Jobs were created although during the period in which he made this announcement jobs were lost in Ontario. Jobs have subsequently been created in Ontario, but I suggest that almost all jobs creation was created by lower interest rates which are directly related to the government's commitment to reducing its deficit. In other words, all rate reductions in the world do not stimulate the economy and do not create any new employment.

We might consider that the same generation of people today, once again thinking about investments, are thinking about foreign investments. I have heard members of the Reform Party talk about not making Canadians invest in Canada and allowing them to invest all over the world. Essentially the agenda of the Reform Party is to promote capital flights: give them a tax reduction and let them take the money out of the country.

Many people will say that for every billion dollars of direct foreign investment in Canada 45,000 new jobs are created. Similarly it must follow that for every billion dollars removed from our economy 45,000 jobs may well disappear. The Reform Party's agenda may indirectly result in reductions in jobs and not the increase Reformers constantly tell us about.

It is a delight to be in this new parliament because we have two parties that are diametrically opposed. I listened to members of the NDP who constantly think the simple answer to all our social problems is to spend more money.

As a nation we have to spend money wisely and efficiently. In my riding I have a program called CAPC, a federally funded social program to assist young teenage parents with a nutritional program and prenatal care. I am proud to say that this coming week the program is being expanded in Port Perry in my riding. They have expanded it in many communities. It is amazing that it has been done with the same budget it has had for the last five years. More services are being delivered to assist these people.

We cannot create smart parents. I do not think everything we do will create better parents. We need people in the communities who try to assist these people. We can help in the delivery of the system to assist with child poverty.

I am very proud to be part of a government that recognizes the importance of some of these building tools and building blocks. I am also very proud to be part of a government that recognizes there is such a thing as child poverty, especially in working low income families. The government has changed the working income supplement to breathe more financial strength into parents who are trying to work and at the same time support their young families.

This is the balance we need. The word spending has been going around and around this room the past two or three days. What is missing from the debate is that there is a difference between consumption and investment.

I will give a definition. To consume is simply that we pay out the money and it is gone tomorrow. Some people might say that seniors are entitled to their old age pension cheques. When they get the money in their hands they usually spend it and the money is gone. There is no money coming back into the economic system. We owe these people the support. They have entered into a trust agreement with us.

The other side of the spending equation is investment. I heard the member for Kelowna talk about investments in the technology partnership program. That program is oriented toward some very positive things. When the money comes back in, all Canadians will benefit from it. The money did not actually disappear. The money is still out in the system and will come back not only in its original form but also added to it will be some of the benefits of the growth that has actually occurred in the economy.

When we look at government expenditures the problem is that we do not think about these two different factors: the difference between investments and consumption. I am very proud to be part of a government that talks in the throne speech about investment spending and investment in people.

If we can solve some of the child poverty problems that investment will come back to us. Those people will be less of a threat to our criminal justice system. More important, they will have the tools and the skills to live useful lives.

The government has been very concerned about investment in the area of science and technology. I heard some members opposite talk about the fact that many people with technological skills were being hired south of the border. The average master's graduate in science and technological earns $45,000 to $50,000 in Canada. In the United States they will earn $65,000 to $70,000. That is a great incentive. Members opposite blame our tax system. There is some relationship between our tax system and that of the United States.

Another aspect of the economy is that our supply of those graduates is very low. When the supply is low pure economics bids up the value of labour. There is a bidding war. Similarly when there is a shortage in the United States they bid up their costs and they are removed from our country.

We have companies in Ottawa such as Newbridge Networks which needs 4,000 workers. It will only hire half of them in Canada. Nortel needs 5,000 workers. At best it can only hire 700 here because that is all that is available. In my own riding Durham College has a science and technology program with an enrolment of 700 students. The bottom line is that they could all get those jobs twice over. In other words, there is an emerging science and technology community which we are not filling.

What can governments do to invest in their people so that they will have the opportunities and that Canada and our standard of living will be better for it?

I am proud of a government that recognizes this is how the economy is evolving. The throne speech talked about the new millennium fund of $1 billion to help low income people who want a post-secondary education, hopefully in the areas of science and technology.

This is a very positive statement about how we want to invest. I keep coming back to the word invest as opposed to spending. Members opposite probably think this is frivolous, that money should have been given to higher income groups through rate reductions rather than by helping people to get the opportunity to better their positions in our society.

As in the previous parliament we have the Canada Foundation for Innovation. I am working with some of my community colleges to ensure they can access these funds to build their programs. They have indicated to me that their biggest problem is not having enough money to run their programs. They need more top grade scientific equipment to teach their people, to give them the skills to become competitive in the 21st century. I am happy to be part of a process that recognizes we have to give these people the tools to compete in the new millennium.

At the same time as we have this problem going on, we are going through a process of studying our immigration laws that satiate some of the demand of high tech companies in Canada. In this labour market the total immigrant population in 1990 was 1,900. By 1996 the figure was 6,600. These people were brought in from other countries because we did not have the skills to fill these jobs. It is very important that we as a government take the initiative to give our people the skills.

In conclusion, I think what is really missing from this debate is when somebody stands up and says that spending is bad and tax cuts are good. That is a very simplistic argument. The reality is we need to do more investing in people and I am very proud to be part of a government that recognizes that. Yes, we are going to reduce the deficit and debt, but at the same time we are not going to forget the opportunities and challenges facing our people. We are going to give them the tools to meet the 21st century.

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5:30 p.m.


Werner Schmidt Reform Kelowna, BC

Mr. Speaker, I am very pleased to have listened to that speech and yet I am terribly disappointed in some of the content of the speech.

The hon. member for Durham and the hon. member opposite should listen more carefully and I would have enjoyed the whole speech.

It was when I began listening with great interest that I began to recognize that something did not make sense. There is a lot of stuff that does not make sense in that speech.

I think the suggestion was made somehow that people who cut taxes do not necessarily increase the employment of people. I would like to refer the member to some statistics that I have put together here with certain American states. In fact, there are about 10 of them that have increased taxes in the years between 1990 and 1995. During that time period we also have about the same number of states that have cut taxes. We have two groups here, one group that increased taxes and another group that decreased taxes.

It was very interesting to note that for the tax hikers over that 10 year period, the total revenue that the states collected was increased by 27%. They hiked their taxes in order to increase their revenue. They did by 27%. The tax cutters cut their taxes and their revenues increased 32.6%. That is very interesting. They cut their taxes but increased their total revenues.

Let us look at job creation. The tax hikers increased employment, percentage wise, zero. The tax cutters over that same five year period increased their employment by 10.8 percent. That is very significant. These are not numbers that I made up or that somebody manufactured for this speech. These are numbers that exist. The hon. member can find those numbers himself. They are very significant.

The member then suggested that when people get jobs all they do is spend the money, suggesting that somehow spending money is a bad thing. Mr. Speaker, I know you are a businessman and I know that much of the business you have done in your lifetime has been spending dollars that have come from other people. You, Mr. Speaker, have become a wealthy man because you invested that money.

The hon. member opposite has had exactly the same kind of experience. He has become wealthy because people spent their money. The suggestion that is being made here is that when people spend money is disappears. Investment money comes back.

How it is that tax hikers had no increase in jobs but the tax cutters had an increase in jobs? Let him explain to us that spending actually hurts the economy.

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5:30 p.m.


Alex Shepherd Liberal Durham, ON

Mr. Speaker, I thank the member for his question. Obviously I do not have the statistics that the member has before him. However, I am sure that there is a plausible explanation. I am glad that he used the American example because it lets me remind people that this whole agenda of the Reform Party is not new. It was started by Ronald Reagan. Basic Reaganomics said that what it was going to do is reduce taxes, stimulate demand and get rid of the deficit.

The results are, and the member can and look just as easily as I can, as the member suggested to me, that the U.S. went to a deficit of $1 trillion in that same period of time, almost bankrupting that country. Why is that?

Under Reaganomics they did stimulate demand at that time. The stimulation went to foreign imports. The bottom line is that they went out and bought Japanese cars. There were no more jobs created and the U.S. deficit went through the ceiling and they are still paying for it.

Do not tell me that there is a simple solution, that if we put some dollars into people's pockets somehow that will solve all of our unemployment problems. It will not.

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5:35 p.m.


Paul Crête Bloc Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC

Mr. Speaker, I listened with interest to the discourse of the member for Durham and I was trying to think what it reminded me of. I have finally remembered. It is the same discourse we heard in 1970, 1971 and 1972 in the early Trudeau years. It is the same kind of discourse we heard then, telling us that the federal government would create a just society, that it could spend in all sorts of sectors outside its jurisdiction, and that we were going to see that it would be able to do it much better than any of the provinces or anyone close to the issue and the people.

This is exactly what the present government brings to mind. After three and a half years, it has been forced, by a large deficit, to retract its promises and to adopt the Reform Party platform, just as the Trudeau government borrowed from the NDP platform in order to stay in power. This is exactly the image that comes to mind.

I would like to ask the member a question. In this context, the Minister responsible for the Federal Office of Regional Development made a wonderful announcement last week “We are going to invest in employment and partnership for young people, in community futures development corporations, to set up a program to help people start a business, and to hire youth advisers”. This is great for votes, it is very laudable and sounds very interesting.

But we now know—we can no longer forget—that in the provinces, such as Quebec, structures have already been planned for the strategic development of local areas. The federal government steps in, bringing with it further duplication of existing programs: it creates a new program that will do exactly the same thing.

Is that the model that is ultimately going to be offered? Will the citizens of Quebec and Canada once again be told that, now that it has turned the screws a little tighter, the federal government will again begin to meddle in affairs that do not properly concern it?

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5:35 p.m.


Alex Shepherd Liberal Durham, ON

Mr. Speaker, I thank the member for his question. The reality is Canada's government has a commitment to its youth and the extent to which we take advantage of that, no matter what province they live in, is a positive thing.

There is a horizons program that takes young people in universities who have been educated in the area of export development and puts them into small and medium size businesses to make those businesses export ready. There are a number of programs that once again take some of those youth with an understanding of the information highway and put them into small and medium size businesses to empower those businesses.

The member is talking about duplication and overlap. I do not think, frankly, that there is enough money to go around. The problem with good initiatives, whether they be federal or provincial, is that there still is not enough money to take up the need. I am sure those students, those young people in Quebec, are happy to share in a federal program that has a federal initiative and vision about where the country is going in the area of science and technology.

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5:35 p.m.


Monte Solberg Reform Medicine Hat, AB

Mr. Speaker, briefly to the issue of Reaganomics, during the Reagan era after the U.S. government cut taxes to top marginal rate, employment in the U.S. increased by 17 million jobs and revenues doubled. But because of a profligacy in the Congress, the deficit did increase.

The government's own finance department said in a research paper that cutting payroll taxes does create jobs. It talked about an increase in the payroll taxes causing about a 1 percent increase in unemployment in this country. I would invite the hon. member to check the numbers from his own finance department to find out the horrendous impact that payroll taxes have on job.

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5:40 p.m.


Alex Shepherd Liberal Durham, ON

Mr. Speaker, I will even concede to the hon. member that payroll taxes do have an impact on job creation. I wish we could reduce them to a nominal amount.

The reality of government funding and government financing is that is not possible. If you want us to stay in the Canada pension plan, like all the people in my riding have told me, then you have to implement reforms to make that happen.

When we talk about tax reduction, I do not doubt that UI rate reductions are going to be on the table. We have been reducing them, by the way.

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5:40 p.m.


Peter Stoffer NDP Sackville—Eastern Shore, NS

Mr. Speaker, I thank you for the opportunity to speak today against the Reform motion and that of the Liberal Party. I also wish to thank the constituents and the people of Sackville—Eastern Shore, a new riding in Nova Scotia, who elected me and gave me their trust and honour and privilege to represent them in this House of Commons.

It is amazing when we hear the Reform and the Liberal Party go on and on with their rhetoric. I want to inform them that the people of Sackville—Eastern Shore, Nova Scotia elected me to come to the House of Commons for political solutions, not political interference.

They wanted me to come and not only hold the government accountable and hold other opposition parties accountable for their actions and their responsibilities, but also to work with them to find the solutions of today.

When the hon. member for Durham talks about the NDP and our policies, I should inform this House that we are the only federal party whose parliamentary and constituency staff are organized under a collective agreement. We do not hear anything coming from their side on that aspect of it.

Where are the Reform and Liberal backbenchers to help us eliminate the immigration head tax?

If I may digress a little, I wish to inform the House that I am an immigrant. My mother and father and six of us moved to this country in 1956. We went from Halifax at pier 21 by train all the way to Vancouver. I want to tell members what my parents told me. At the time I was only eight months old.

My father was in the Dutch resistance during the war of 1939 to 1945. The first person who rescued him out of a POW camp was a Canadian. Because of that, he had a lifelong dream to come to Canada. Because of the closure of the coal mines in the south of Holland in 1952, 25,000 families in the south of Holland had to literally evacuate the country because there were no opportunities at that time.

We came to Canada in 1956. My father got off the boat at pier 21 and the first question he asked in his broken English to a woman from the Salvation Army who was there to help, along with the Red Cross, was where he could get food for eight people for a two day journey. She asked where he was headed. He said Vancouver. She laughed and laughed and of course it was contagious and my father started to laugh and laugh as well, not knowing what he was laughing about. He did not realize that it was a six day journey from Halifax to Vancouver by train.

Anyway, we got to Vancouver and that Christmas my mother received a turkey from her local church group. She had never seen a 20 pound turkey before. Not knowing what to do with it, she cut it up in little pieces and fried it up in two huge cast iron skillets. The woman next door who happened to be from Quebec and was living in Delta walked in to see how the turkey was coming along. She noticed that this turkey was cut up in tiny little pieces and she laughed and laughed. Of course my mother started to laugh as well. It was quite contagious. This woman then took my mother down to the store and got another turkey for her and showed her how to cook it properly.

My parents, in return, invested in Canada by running a group home for over 25 years. For over 25 years I grew up in a group home with over 400 children from across the country who were runaways, who were abused, from every aspect of life. My parents did that to repay Canada for their lovely entry to this country.

The reason I say that is because I spoke with my parents the other day. My father is under palliative care. One of his closest friends passed away two months ago waiting for a transplant operation. The hon. member for Durham should understand that my parents' laughter is now gone. The cuts to health care have taken away their humour.

Where are the political parties when it comes to health and education?

Our most valuable resource is our children, and yet we turn around and say to people that children with disabilities cannot receive proper education because we do not have the money. We have the money to give huge tax breaks to profitable banks and corporations. It is simply scandalous that this rhetoric can go on and on.

I wish to say a few things about the deficit and the debt and what we should do about them.

Average Canadians are the real heroes in the war against the deficit. They are the ones who should benefit from their struggles.

The interests of big business and Canada's elite cannot be put ahead of ordinary Canadians. The Reform Party and lobby groups, such as the Business Council on National Issues, are pressuring the government to give further tax breaks to Canada's highest income earners and the most successful corporations.

Unprecedented government cuts to programs, such as Canada's health care and education systems, might have improved the government's bottom line, but they have increasingly threatened the average Canadian; not only average Canadians who use the public services of health and education, but all Canadians who have a job; those who are said, from the government lines, lucky to have a job.

The current trend is that Reformers are pushing the Liberals into their agenda, away from the previous Tory agenda. During the campaign I liked to say that the Liberals have reformed the Tory agenda.

People who have worked for 20 or 30 years are now insecure in their jobs. They do not know if they will have a job tomorrow. They do not know if they will be able to meet their payments. They do not know if they will be able to send their kids to college.

Today I asked the Minister of Fisheries and Oceans if he would re-commit to a signed, written contract with the 40,000 fishers of Atlantic Canada and Quebec to maintain the income supplement program known as TAGS, for the fishers of those areas. His response was that he consulted with those people, in order to eliminate the program, for an entire year. Can I honestly believe that he would ask 40,000 fishers “Do you want to lose your income for a year?”

It is simply scandalous that the Minister of Fisheries and Oceans would stand here and tell us that is what he did. It is an absolute scandalous mistruth.

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5:45 p.m.

An hon. member

It's a fish story.

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5:45 p.m.


Peter Stoffer NDP Sackville—Eastern Shore, NS

There is more to it than that. We in New Brunswick, Newfoundland and Nova Scotia pay more for postage stamps than anywhere else in the country because this government introduced the HST. It bribed, cajoled and did everything it could to the Atlantic provinces, and this is what we got stuck with.

The most dreaded tax of all time was the GST. That was not good enough for the Liberals. They had to throw the HST on people. There is HST on children's clothing. There is HST on electricity. There is HST on home heating oil. There is HST on gasoline. How the heck do the Liberals expect low income earners and those on fixed incomes like pensioners to pay for the basic necessities of the day to day lifestyle in Nova Scotia, New Brunswick and Newfoundland?

It is simply scandalous that the hon. member for Durham, with the cheerleading crowd from Ontario, and Reform members can stand and say that there should be more tax cuts. Why do they not stand in the House and tell the people of Atlantic Canada “Yes, we will give you a tax cut. We will give you a major tax cut on the HST”.

We now have a premier who is unelected, Mr. Russell MacLellan. He was appointed by the Liberal Party. He was here in the House and signed the agreement implementing the HST. Now he is back there saying to the people, because he may be coming up for a byelection soon, that they will re-think the HST. We are encouraging him to re-think it all the way back to the federal party.

Of course, the finance minister is saying “Mr. MacLellan, before you can say anything like that you have to come to speak to us first”. His hands will be completely tied because of the Liberal agenda, a Liberal agenda which has been pushed and controlled by the Reformers. To us it is simply scandalous that this goes on and on.

The member for Durham was talking about giving money to these programs. Exactly. Total tax reform means that we can get enough taxes from profitable businesses and corporations that can afford to pay their fair share and spread the money around.

An elderly gentleman in Cape Breton told me a year ago “Peter, money is like manure. It is only good when it is spread around. When it concentrates in one pile you know exactly what it does”.

I could go on and on with this, folks, but I can assure the House that Atlantic Canadians will not stand for it any longer. Come May the original TAGS program, which was supposed to go to May 1999, is going to expire.

May I remind the House that in the last year we have had people in New Brunswick tear-gassed by the Frank McKenna government. They were fighting to keep their schools open. We have had Cape Breton unionized workers burn down an apartment building because they were in distress trying to find jobs. We had people rocking a media bus in Newfoundland because of their desperation for the TAGS program and supplement programs of that nature.

I encourage members of the House to work together to help those people in Atlantic Canada because if we do not, come May it is going to be a very sorry picture indeed.

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5:50 p.m.


Maurizio Bevilacqua Liberal Vaughan—King—Aurora, ON

Madam Speaker, first I would like to congratulate the hon. member on a heartfelt speech, one that raises some very interesting points about the direction in which our country is going.

I was also very pleased to find out that the hon. member believes that now is the time to engage in serious debate about which direction we are going to take.

Madam Speaker, I want to bring to your attention, since the hon. member is a new member in this House, that the Liberal government has used the consultation method, including prebudget consultation meetings, as well as a number of meetings across the country on social security review to modernize and restructure Canada's social security system. We have made headway and positive change has occurred.

I want to ask the hon. member if his method of representing his constituents will be to hold townhall meetings? For example, we know that in the very near future we will be consulting across the country on the next budget.

Does the hon. member believe that every member of Parliament should participate in that process? We are in a very fortunate position in this country today, as a result of the measures and the fiscal responsibility exercised by this government, to begin to look at new ways and new programs and perhaps a new style of economics since we may in fact be heading for the first time in a long time toward the elimination of the deficit. Does the hon. member think it is the responsibility of members of Parliament on both sides to seek public input on this prebudget consultation period and to hear from him where his constituents would like to see our government go.

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5:50 p.m.


Peter Stoffer NDP Sackville—Eastern Shore, NS

Madam Speaker, I thank the hon. member for his question. Yes, indeed, I will be holding townhall meetings. My goal is to hold at least 50 townhall meetings throughout the next four to five years. Because I have such a large rural and urban riding, I think it is my responsibility and that of my staff to go out to the communities and speak to them on these issues.

I want to have the hon. member understand why I am sitting in this House and what gave me the push to get in here. It was the last townhall meeting, the very famous one, where the prime minister spoke to a woman from Quebec. She told the prime minister that she had three degrees and was finding it very difficult to get a job. His response was “Well, Madam, you know in life some people are lucky, some are not”.

The second he said that I phoned my provincial secretary and asked him to tell me what I had to do to become a candidate in the next election so that I could face the prime minister and his party and question him on the fact that we do not base our society on luck. We base it on hard work, compassion and fairness.

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5:55 p.m.


Janko Peric Liberal Cambridge, ON

Madam Speaker, I was really impressed with the hon. member's speech. I came to this country almost 30 years ago and I went through hardships which were probably much easier than those of his parents.

Over the last four years I had an opportunity to travel to Europe and the Pacific rim. Just recently I was an election observer in Bosnia. Last year for the first time I took my family to Europe for a vacation and I had the opportunity to meet a colleague from my childhood in Frankfurt for breakfast. For the two of us it cost 36 Deutschemarks. The same breakfast could probably be bought here for $6.

My question for the hon. member is this. Does he have a better agenda than that of the government? If he does, why does he not tell us? What I heard from NDP candidates during the election campaign was that their agenda was similar to the eastern European agenda.