Debates of Feb. 18th, 1998

Supply

[Charlie Power, Progressive Conservative, St. John's West, NL]

Madam Speaker, in answer to the question, very often in debating in the House of Commons or any other place we want to say the same things, we agree on the same things and we take different approaches to them.

I am a very strong believer that free trade helped this country. Free trade created those million jobs that the Liberals take credit for now and say what a great economy we have. In Canada, with so many interprovincial trade barriers, our domestic economy has not grown at all like our export economy. That is very easy to prove.

In future it will not be free trade that will create jobs in this country. It will be free brains that will be developed in the minds of our young people in our universities and post-secondary institutions. That is where the future is. I am really not interested in sitting down, listening and talking about what happened to free trade, GST, 1984 and 1991. In 1998 we have 1.5 million students who are heavily indebted. Their future, if they can get an education, is going to be a good education at a reasonable cost.

[Alex Shepherd, Liberal, Durham, ON]

Madam Speaker, I listened with intent to the member. He talked about huge economic social problems of the future. Also, the motion addresses people fleeing from this country.

I could not help but observe a few short days ago that this party sided with and supported a motion from the Bloc Quebecois which denied a legal process. That is the unilateral declaration of independence by the separatist party in Quebec. I take that one step further. It is a suspension of the Constitution of Canada. It would be a suspension of the rule of law in this country.

How many people does he think will leave the country the day that revolution starts?

[Charlie Power, Progressive Conservative, St. John's West, NL]

Madam Speaker, that is absolutely the most silly frivolous point when we are talking about student debt and future employment problems.

One of the problems in this country is that little reference to the Supreme Court of Canada. If the Liberal Party of Canada wants to create separatists that is one of the great ways to do it. It has caused the constitutional crisis of this country. It is devoid of ideas of how to deal with Quebec. It is devoid of ideas of how to create employment.

To use this reference to the Supreme Court of Canada to try to brand our leader, the federalist who saved Canada in 1995, as a separatist because he does not agree with the government resolution is wrong. It was wrong when the government sent it to the supreme court. It is still wrong. It will do nothing for the good of Canada. If it creates unemployment or it creates separatists, it is because the Liberal government did not have many ideas to begin with.

[The Acting Speaker (Ms. Thibeault)]

Thirty seconds for the hon. member for Wentworth—Burlington.

[John Bryden, Liberal, Wentworth—Burlington, ON]

Madam Speaker, the member for St. John's West commented considerably on the fact that student unemployment is the crucial problem. Would he not agree that student debt is not the problem, it is student unemployment? They come out of university and cannot get jobs to pay off their debts.

Does he not agree that is because the economic situation which exists in his province and across the country was a result of Conservative mismanagement of the economy for nine years? That is why there are no jobs. It is his former government that is—

[The Acting Speaker (Ms. Thibeault)]

The hon. member for St. John's West.

[Charlie Power, Progressive Conservative, St. John's West, NL]

Madam Speaker, obviously there is a great connection between being able to find a job and paying off any debt you happen to have.

In the case of students, debt has become significantly more difficult. With student aid, even if you get a job, if you end up with $25,000 in debt for an undergraduate degree, and probably $40,000 plus for a masters degree, even at reasonable rates of remuneration, you cannot pay off the debt. It is simply not manageable.

[Jim Jones, Progressive Conservative, Markham, ON]

Madam Speaker, I would like to thank the member for Kings—Hants and the member for St. John's East for bringing this important motion to the House.

The Minister of Finance was warned by university leaders months ago that a brain drain is drawing the intellectual life out of Canada. A prescription to remedy this problem is an infusion of dollars for research and training to increase participation.

It is time this government realizes that Canada is not an island on its own. We need to retain our human capital and convince Canadians to stay here in a country that has full potential to prosper internationally at an exceptional level. Right now is the time for this to happen.

Many of our country's most promising young researchers and academics are leaving for more enticing grounds, mainly to the United States. They are leaving because they cannot get the resources they need to thrive in Canada, namely research dollars, decent salaries and lower taxes.

Consequently this trend will ultimately damage our economy. Canada stands to lose domestic talent to our southern neighbour. Less homegrown research and development means fewer resources available to support our Canadian businesses. These same businesses are struggling to find well trained workers who will help them compete internationally.

The facts are clear. Canada is losing talent to the United States because American companies are offering Canadians higher salaries and the U.S. government can offer lower taxes.

High taxes in this country are also scaring away businesses to low tax U.S. and other destinations around the world. The tax rate for corporations ranges from 38% to 46% in Canada. In the U.S. it is considerably lower. If corporations are feeling the pinch, let us now consider young people and understand what drives them south of the border.

Studies indicate that as of late we are losing young talent and ambition. Our leaders are the future. A student graduating from university is faced with a high debt burden from years of student loans. When offered a high paying job, they obviously take it in anticipation of ridding themselves of debt and saving for the future. Paying off a debt of $25,000 to $30,000 when entering the workforce is unbearable. How are our young people ever to get ahead when they are suffocated with huge student loan payments monthly?

Debt repayment incentives are driving our teachers to Columbia, Mexico, Egypt and the United States. High debtloads are driving our engineers and computer scientists to the United States and many private school grads are deciding to work elsewhere to cover their debtloads.

I urge this government to seriously consider the implications it is imposing on our young graduates. Student debt burdens are a serious problem in Canada. The Minister of Finance must introduce measures in the upcoming budget that will repair the damage he has done to our young people.

The only way to ensure that the Canadian economy continues to grow is to empower the consumer. To do this requires an increase in the disposable income of Canadians. Unlike in the United States, disposable income has fallen in Canada. In fact, it has fallen or been flat for two years running. The unemployment rate in the United States has been considerably higher. Canada's unemployment rate, on the other hand, has consistently been higher than that of our southern partner.

The Liberal government has continued to cut, cut, cut. Now its eyes are finally opening, a little late I might add. Dramatic cuts in post-secondary education by this government have caused the average student debt to almost triple this decade from an average of $8,700 in 1990 to $20,000 this year and forecast to $25,000 in 1998.

I believe in the Liberal budget next week they will be coming out with the millennium fund of $1 billion. They have caused this student debt by tripling tuition fees in the 1990s. Maybe they should be giving the money back to the universities so that tuition fees can be reduced.

These disheartening figures point to another issue that is surfacing. The fear of enormous debt is driving qualified students away from the universities. How will this country compete internationally if talent is not encouraged to flourish? If this trend continues, what future does this country have?

We know that the personal income tax gap has widened between Canada and the United States.

This is due to many reasons. One which can be fixed in this upcoming budget is bracket creep. By indexing bracket creep we can realize almost a billion dollars returned to the hands of Canadians. It is time that we let Canadians spend their money instead of government.

A document compiled by the industry department raises serious concerns about whether Canada has much to brag about or not. This report is entitled “Keeping up with the Jones”, no relation I can guarantee. It reveals the true picture, not the rosy one this government keeps referring to.

Let me share with this House some of the findings since the Liberal government so quickly swept it under the carpet with embarrassment.

The national income gap between Canada and the United States is getting worse. Americans are now 25% richer than Canadians. The U.S. economy is getting richer and it is paying its workers better. The salary gap is especially pronounced in occupations requiring high skills. Engineers, computer scientists and architects are earning an average of $11,000 to $13,000 more than their Canadian counterparts.

The combination of lower taxes and higher income in the United States means working Americans have more money to spend. An example is a couple with $80,000 in taxable income and two children living in California will take home $7,000 more than a similar Canadian family.

Canadians pay about one-third more in taxes. Top corporate tax rates are significantly higher in Canada than in the United States.

Many state governments offer very generous tax and investment incentives to businesses for the purpose of attracting investment and innovation activities. Canada's ability to attract and retain knowledge workers is seriously undermined by its personal income tax structure.

Canadian workers hand over significantly larger portions of their earnings to the tax man than Americans. The top marginal personal income tax is 20% higher in Canada than in the United States.

The continual shortage of knowledge workers such as software engineers in this country poses a huge problem as Canadian business struggles daily with the year 2000 problem. It is estimated that there are 300,000 Canadians in California working in Silicone Valley.

It is time this government admits to these mistakes. It must undo the damage it has done. Cuts in transfers to the province have cost this government the credibility as an effective government and are costing Canada our talent.

The Liberal government must put a stop to this brain drain. Unless this government wakes up and starts now, we stand to lose more and more of our talent to the United States.

[Paul Szabo, Liberal, Mississauga South, ON]

Madam Speaker, the member repeated the numbers the leader of the Conservative Party said about the differential between Canada and the U.S. in terms of the average income.

The member did not mention that in Canada we have a different income tax system. The computations are different. We have things that are outside the Income Tax Act whereas they are not similar in the U.S., for example the child tax benefit, the GST credit and our health care system alone. He used the example that a family making $80,000 a year in the United States would have $7,000 more of disposable income than a similar family in Canada.

I would like to ask the member if he can tell this House exactly how much that family in the U.S. then has to pay for health care and social security that Canadians do not have to pay for.

[Jim Jones, Progressive Conservative, Markham, ON]

Madam Speaker, if we compare the tax rate between Canada and the U.S., in Canada we max out at the top tax rate at $55,000 to $60,000. That is 54% in Ontario, I guess a little less now with the cuts the Harris government has done for the provincial level.

In the U.S. people max out at 36%, at $250,000. With the difference between the 20%, a lot of health care can be bought, child tax benefits, education. There is a lot more disposable income and just as good an education system.

[Jason Kenney, Reform, Calgary Southeast, AB]

Madam Speaker, I am entertained watching our Liberal and Tory friends quibble over their GST. It is very entertaining indeed.

I was very interested in the remarks made by the hon. member for Markham. He is a strong advocate of tax relief as a policy for economic growth. However, not too long ago I read some remarks made by the hon. member in the local Markham newspaper. He said that if Mike Harris continues his harsh cuts which are necessary in order for him to impose tax cuts, this would hurt the federal Progressive Conservative Party in Ontario. I find it ironic for a party which is at 12% in Ontario to be criticizing at party which is at 35%.

I wonder if the hon. member could explain how he squares his remarks this evening with his earlier comments which criticized the fiscal virtue of the Mike Harris common sense revolution.

[Jim Jones, Progressive Conservative, Markham, ON]

Madam Speaker, I heard the member from Calgary bring this up the other day in the House. If he had called me instead of making the comment in the House he would have found out exactly what I said.

I agree with what Mike Harris has done. In this country, in the last nine months of 1997, 270,000 jobs were created. Of those 270,000 jobs 216,000 were created in Ontario. That proves that high taxes cost jobs.

What I said is that on issues such as the megacity people are saying that maybe the Harris government could communicate a little better. Government could be a little more consultative when bringing people into the process so they understand and accept what the problem is and what the government is trying to do.

I did not say I was against Mike Harris and I did not say I was against his tax cuts.

[Tony Valeri, Liberal, Parliamentary Secretary to Minister of Finance]

Madam Speaker, I will start off by saying how quickly they forget. How quickly the hon. member for Sherbrooke forgets. Let me remind the House of a few frightening fiscal facts.

In 1985 the government recorded a deficit of over $38 billion. By 1993 it got the deficit down to $41 billion. Over those nine years the total yearly deficits exceeded $290 billion. Just as damning, the interest payments on those deficits totalled $300 billion.

I am not trying to shift the focus of today's debate. The fact is that decade of deficits and the failure of political will which resulted in them is a key reason why Canada's tax burden is so heavy today.

There is no mathematical mystery here. Deficits are like credit cards. The more you use them, the more you have to pay back, principal plus some pretty heavy interest. The only way governments can pay interest, even before they get to the principal, is through taxes. The more the interest grows, the more the taxes grow.

Let us look at the evidence on taxation. I think we will find the fingerprints of the hon. member for Sherbrooke all over it.

In 1985 the former government introduced the high income surtax. It was a temporary measure to help fight the deficit. Then there was 1986 when that government added a 3% surtax on the basic federal tax. Again it was a temporary measure to fight the deficit.

Those surtaxes are still with us because when we came to office the deficit was the highest it had ever been.

If the hon. member wants to condemn a government for our painful tax burden he only has to open his scrapbook. If he wants to thunder about a brain drain crisis he should consider how the two surtaxes which he helped to introduce have added thousands of dollars to the yearly tax bills of successful professionals and scientists.

My purpose today is not just to look at what caused the tax problems Canadians face but to remind the hon. member that when he looks at this government he is also seeing solutions that work.

From the start of our first mandate we made an absolute commitment to deficit reduction and elimination. One of the driving reasons was our recognition that the only way we could start the process of broad based tax relief was to get our finances under control.

Since then we have brought the deficit from $42 billion down to $8.7 billion last year, the lowest level since 1969-70. We have done this without a single increase in personal income tax. Despite our constrained fiscal situation we began a process of targeted tax relief to those who needed it most and where it could do in fact the most economic and social good. These include increasing the child tax benefit by $850 million and measures to help the disabled, low income working parents and Canada's charities.

The Prime Minister and the Minister of Finance have made it quite clear that this is only a start. As our fiscal situation improves so that we can act without jeopardizing our fiscal progress and while preserving Canada's cherished social programs, we will certainly widen the scope of our tax action.

There is another area where we have already taken some positive action. I would like to highlight it because it relates directly to the specific problem the hon. member addresses, student debt loads.

Another bit of history the hon. member for Sherbrooke may have forgotten or perhaps would like Canadians to overlook is that during the Tory government era the tax credit which was supposed to help cover basic personal necessities for post-secondary students grew from $50 to $80. That was between 1984 and 1993. Under our government, in just half the time that education amount more than doubled to $200 a month.

Our government understands that in today's work knowledge and education are the keys to economic and individual success and security. We are not only talking the talk, something the hon. member is very good at, I might say, but we also walk the walk. That is why our 1996 budget provided an $80 million increase in direct federal tax assistance for post-secondary education. In last year's budget we increased that support by $137 million through measures whose value will reach $275 million when they mature.

They were complemented by the creation of the Canada Foundation for Innovation which will ensure that post-secondary students have access to better facilities and equipment to prepare for the knowledge based economy of the 21st century.

The other measures include increasing the education credit to $150 per month from $100 immediately and increasing it to $200 per month in 1998 and in subsequent years, allowing students to carry forward all unused portions of the education and tuition credits to be applied against any future income.

As a result of these budget measures a student in full time attendance at a post-secondary institution for eight months with tuition fees of $2,800 and additional fees of $300 will receive over $1,200 in combined federal and provincial tax assistance per year. This is an increase of more than 30% from the $900 in assistance available to students in 1995.

The 1997 budget also announced an important change to the Canada student loans program. To better recognize that some students still may not have the capacity to repay their loans, the budget proposed to extend to 30 months from 18 months the period of time during which students are allowed to defer making payments. Combined with the initial six months after graduation when no payments are required, this means that students will have up to three years of help in dealing with their loans.

I do not want to magnify our actions. We know they are only the beginning of a solution for Canada's students. That is why the Prime Minister has set out a dramatic further advance, the millennium scholarships. He has told Canadians that will be an important part of next week's budget. Let us remember that every dollar of scholarship a student receives—and the Prime Minister has said in his speeches that this will help tens of thousands—is one dollar less debt that he or she must incur.

I could certainly go on reminding members of the House how legislation before us will help tomorrow's students by doubling the annual limit of contributions to registered education savings plans.

While students and the plight of Canadian taxpayers deserve our attention, this motion does nought. There is no doubt the problems it raises are real, but the solutions we are offering are equally real. Starting with the courageous deficit action that eluded the previous government, I am confident that next week's federal budget will prove that our solutions are more certain and more concrete than the motion and the hon. member dares to dream.

I can go on and on about the various initiatives the government has put forward. Let us remember one thing. This party and this member do not own any of the issues of student debt. Canadians and students across the country have continued to communicate with the government and with members on this side of the House who held town hall meetings in their ridings to talk about the plight of students.

We realize that education and skills training will certainly be the cornerstone by which the economy will continue to grow into the next millennium. We have said over and over again in the House that the government is committed to ensuring that students have accessibility to higher education and skills training. We have done it in our past budgets and we will continue to do it in the upcoming budget.

I want to mention something I neglected to mention earlier. I will be splitting my time with the member for Kitchener Centre.

When the member for Sherbrooke decided to come forward with the motion, he conveniently forgot the previous Tory government was in large part responsible for the mess we found the country in. Today he comes to the House merely pointing out the problems and not offering anything in terms of concrete solutions, except to say that a broad based tax cut, irrespective of whether or not the government books are in balance, is the solution.

I would say to the Tory caucus that Canadians disagree.

[Roy H. Bailey, Reform, Souris—Moose Mountain, SK]

Madam Speaker, somehow I do not like the term brain drain. It somehow indicates that all the smarts have gone some place else. Looking around at all of us here, I do not believe that is true.

I would like to direct a question to the member who has just spoken. I would rather call it an intellectual exodus. Does the member remember the greatest exodus outside the depression in Saskatchewan? The greatest exodus that ever hit Manitoba, Saskatchewan and Alberta was when a Liberal government instituted the national energy policy.

We are talking about an exodus. That kind of taxation brings about an exodus. Would the member not agree that the exodus we are talking about is brought about by high taxation?

[Tony Valeri, Liberal, Stoney Creek, ON]

Madam Speaker, while I respect the intervention of the member, to stand and essentially say that all the challenges faced by the country as we move into the next century will be solved by reducing taxes is just not the case.

Right from the beginning the government has said we would continue on a balanced approach. We have done so since we came to office. The Reform Party certainly does not have to worry about our commitment to fiscal responsibility. It is rock solid.

I am sure the hon. member will be here on February 24 at 4.30 p.m. to listen very closely to the budget speech. That budget will certainly be not merely rhetoric or exchanges in the House but a demonstration of the commitment of the government and of the results we have been able to achieve.

[Werner Schmidt, Reform, Kelowna, BC]

Madam Speaker, I found it rather amusing to look at the members who proposed the motion and to hear the reply we just heard from the Liberal member opposite. A pox on both parties.

On the one hand the Liberal government says the fault lies with the previous Conservative government. The Conservatives simply say it was the Liberals' fault because of what they are doing. One of those parties governed the country since Confederation. Therefore it seems to me they are both to blame.

If the hon. member would have had another five minutes to speak, I think he would have lost one arm. He was so busy patting himself on the back that there is no way he could have preserved his arm.

The claim is that taxes have been reduced and the government has been balanced in everything it has done. Why is it, then, that we have so many bankruptcies and so much dissatisfaction with what is happening?

[Tony Valeri, Liberal, Stoney Creek, ON]

Madam Speaker, I remind the hon. member for Kelowna that if he wants to dole out the blame between those two parties he should also stand in the House to say that the Liberal government will balance the books over the next number of years.

The Liberal government takes initiative in terms of reducing taxation for Canadians. The Liberal government invests in the priorities of Canadians in education and health care. The Liberal government will bring the country into the next millennium with stronger fundamentals than there have ever been, with confidence in a stronger economy than has ever been, and with Canadians saying they have greater opportunity than they had between 1984 to 1992.

The member can live in the past if he wants to. I am not patting myself on the back. I am merely stating the facts and ensuring they get on the record, only for the benefit of members opposite.

[Karen Redman, Liberal, Kitchener Centre, ON]

Madam Speaker, I thank you for the opportunity to apply a little reason to what has become a very rhetorical debate.

My colleagues opposite seem to relish raising alarm bells about the national brain drain. It is true some American and Canadian employers are competing for talented Canadian youth. An example would be the software industry. The brain drain is a challenge faced by all industrialized countries including the United States.

I encourage members opposite to raise their awareness of the government's many strategic investments in Canada's young people which seek to create job opportunities for them at home.

I welcome the chance to assure the hon. member that Canada's future is in very good hands. It is in the hands of extraordinarily talented and creative young people, the best educated, the most literate and the most technologically savvy generation the country has ever produced.

As the Prime Minister stated in his Reply to the Speech from the Throne, the government is investing in our youth's future. He said “Canada will remain the best country to live in because it cares about its people”.

Our commitments to Canada's youth are a living testimonial to a fundamental truth. Let me remind the House that the government made youth a national priority. Each year we invest over $2 billion on youth programs aimed at helping young people to realize their potential and to prepare them to seize job opportunities in the emerging new economy. These investments support access to learning, the key to employability in today's demanding and rapidly changing economy.

We offer young Canadians every opportunity to pursue their professional goals by supporting them financially in their post-secondary studies. Increasing access to higher learning is an overriding goal of federal initiatives such as the Canada student loans program, registered education savings plans, and the recently announced millennium scholarship endowment fund.

Access to education is only one part of this equation. The federal government also makes strategic investments in science, technology and the creation of knowledge, the very lifeblood of the new economy. These investments enable Canadian youth to carve out new niches for themselves in an emerging knowledge economy.

To encourage excellence and inspire aspiration, this government funds the $800 million Canadian Foundation for Innovation. By rebuilding the research infrastructure of universities and teaching hospitals, the foundation will stimulate economic development in knowledge intensive sectors to improve opportunities for young graduates to pursue research careers here in Canada.

The Government of Canada also works closely with the national business organizations involved in leading edge research into the development of the workforce for the next century. For example we contribute to the business education partnership forum advisory committee which is organized by the Conference Board of Canada. Initiatives such as Career Edge which is backed by over 200 Canadian corporations and the corporate council on youth and the economy are giving Canadian youth a leg up in the competitive global economy.

This government's productive partnerships with the private sector are equipping young Canadians with the skills they need not only to find work but to excel in an information economy. Partnerships such as the sectoral partnership initiative form a cornerstone for Canada's approach to creating job opportunities for youth.

Many of our initiatives link universities with the business community by bringing together educators, employers, workers and government both to define and to address human resource challenges facing Canadian industry. There are a number of outstanding examples of successful partnerships with universities either directly with individual institutions or through the Association of Universities and Colleges of Canada.

Another crucial partnership in light of the skills shortage in one of the fastest growing sectors of our economy is the Software Human Resources Council. The council is working to increase the supply and quality of workers entering this booming area of the labour force and in the process is creating opportunities for Canadian youth.

While we are quick to nurture the best and the brightest, we are equally determined to ensure no young person is left behind in the rapid transition to the knowledge economy. We assist youth who experience difficulties moving from school to the labour market through a range of programs under our youth employment strategy. This government invests $375 million a year in initiatives such as Youth Service Canada, Youth Internship Canada and the student summer job action program to help young people find jobs. Over three years this strategy will create nearly 280,000 experiences for young Canadians.

Since the Government of Canada began investing in youth employment in 1994, over 300,000 youth have acquired work experience and skills development. Recent surveys indicate that 88% of Youth Internship Canada and 85% of Youth Service Canada participants are either employed, self-employed or returned to school six to twelve months after completing the federal youth program.

Our collective challenge is to ensure we nurture this new talent pool, match would be workers with job ready employers and create every opportunity for young people to put their abilities to work for the benefit of Canada.

I am the first to admit that government initiatives are not the entire solution. They never will be. There is no doubt there is much more work to be done to ensure Canadian young people assume their rightful place in the workforce. But there can be no denying that this government is doing many things right.

I do not share my hon. colleague's sense of alarm that the sky is falling. Instead I see every reason to believe that Canada in the new millennium will be a place of great hope and equally great opportunity, a place where young Canadians can proudly stake their claim to a better future.

As Canadian naturalist and author Roderick Haig-Brown once said “In Canada my children are free to make their lives as they would be nowhere else, less free perhaps than I was, because now there are more people; but more free because now there are more ways”.

On that inspirational note I urge my hon. colleague to withdraw his unduly pessimistic motion. Instead find new ways to work with us for the betterment of Canada's young people and for us all. For truly, the sky is the limit.

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

Mr. Speaker, I made the point earlier that simply providing an education for students is not going to solve the problem because there are very few jobs out there. I come from the province of Saskatchewan and I gave the examples. I want to go beyond that and ask the member something else in regard to education.

Many educational institutions are not educating students in a way that prepares them for the working world. They go to some of these institutions of higher learning with the purpose of preparing themselves for a job, a job which they later discover does not exist. Simply pouring money into education in itself does not accomplish miracles.

I hope the member will listen to the question carefully. How can we hold these educational institutions more accountable to provide an education that is truly going to meet the needs of those students who are spending thousands of dollars? How can we hold those institutions more accountable to meet the needs of those students? There is a real problem. They go to these institutions and they end up not being properly prepared. What can we do about that?

[Karen Redman, Liberal, Kitchener Centre, ON]

Mr. Speaker, one of the examples I used in my comments was the sectoral arrangements that are being made and the partnerships that are being formed with institutions in the business sector. It is key that all of those parties continue to look at curriculum and continue to have it evolve in a way where there is meaningful employment at the end of the educational stream. I see that as being done in partnership. That is something this government has demonstrated. Not only is it committed to it happening, but it is successful at having it happen.

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Mr. Speaker, when I hear the undying optimism on the opposite side of the House, I sometimes wonder. I heard one hon. member say earlier that some people in this House talk the talk, but the Liberal government walks the walk. Perhaps we should remind ourselves who is walking the walk. It is the young people in Canada who are seeking opportunities elsewhere who are walking the walk. They are leaving Canada.

With the unbridled optimism of the government, perhaps it should spend less time in the House and more time out talking to young people and telling them why they should stay. Not the talk of this government, but the actions of this government and the fundamentals of the economy are driving the young out of this country.

Given that free trade, the GST and the deregulation of financial services, transportation and energy have been fundamentally important to this government's ability to eliminate the deficit, where did the hon. member stand on free trade and the GST in the 1993 election? Where did the Minister of Finance stand and where did that party stand at that time?

[Karen Redman, Liberal, Kitchener Centre, ON]

Mr. Speaker, the issue of the brain drain is one that is very near and dear to my heart. While not directly in my riding, Kitchener-Waterloo are twin cities. It is one of the institutions the members opposite have been quoting when they talk about the brain drain. I point out to the hon. member that one of the highest growth sectors for the region of Waterloo is the high tech industry. It is staying in Canada. It is creating jobs and opportunities in companies that make this country proud on a global basis.

[Charlie Penson, Reform, Peace River, AB]

Mr. Speaker, when the international trade committee did a study into why small and medium size businesses were not expanding their opportunities, they told us that the cost of business was too high in Canada. The cost of payroll taxes and interprovincial trade barriers were hurting their ability to trade. They said that it was easier to go across the line. One Ontario company said that it was easier to go across the line and establish in Michigan and do business back in Canada.

How does the government intend to resolve the problem that we are losing jobs because we are not competitive?

[Karen Redman, Liberal, Kitchener Centre, ON]

Mr. Speaker, I am not quite clear on the gist of the question, however this government has demonstrated that it is committed to looking at breaking down barriers within Canada as far as trading goes. We will continue down that road.

I would also point out that when something is done in partnership with the provinces, it is something that has to be worked out in concert with them. It is not something that can be done unilaterally. Of course, it is taking time.

[Jason Kenney, Reform, Calgary Southeast, AB]

Mr. Speaker, I am delighted to speak to this supply motion from our friends in the fifth party caucus. We are pleased to support this motion even though it is a conversion on the road to fiscal Damascus as it were for our friends in the fifth party. Late conversions are welcome ones nevertheless.

I must commend the hon. member for Kings—Hants and his colleague from St. John's West for their eloquent remarks on this subject. Later on in my remarks I will address the extent to which their party and their colleagues contributed to the problem.

Let me begin at the outset by saying it has been remarked many times that the government opposite will have to increase the federal chiropractic budget because of the amount of back slapping that is going on over there. It truly is remarkable. They should take up yoga. Such flexibility is required.

This government has applauded itself for its fiscal rectitude, a government that has added a $100 billion to the national debt in three and a half or four years, bringing our debt interest costs up to $47 billion a year. We spend more on debt interest as a percentage of our federal budget, as a percentage of our national accounts and as a percentage of our gross domestic product than does any other G-7 country.

That is money that does not go to post-secondary education. It does not go to support students or higher education. It does not go to help health care or those less fortunate. It goes to line the pockets of bondholders and those to whom we owe this money here and abroad. It is an enormous waste. It is a sinkhole of resources and economic potential. It costs the average Canadian family $6,000 a year in taxes just to finance the $47 billion in debt interest payments.

The party opposite, and occasionally the party to my literal right and my figurative left, sometimes argue that it is cruel and hard hearted to talk about tax relief, that we are misplacing our priorities, that what we need are more big government programs like the Prime Minister's $3 billion endowment fund.

To put it in context, the reality is that $47 billion is almost equivalent to the entire budget of the Government of Ontario for all of its health care, welfare, social programs and everything. It is also equivalent to what the provinces of Newfoundland, New Brunswick, Nova Scotia, Prince Edward Island and Saskatchewan, the five smallest provinces, spend annually on their budgets for all of their programs. That is how much is being flushed down the Liberal-Tory sinkhole of debt financing.

We believe there is a need for radical, dramatic policy change to offer hope and opportunity to younger Canadians, those who are presently struggling to get into university, those who are in university and struggling to get out from under their debt, and those who are out of university struggling to get into the labour market but who are unable to do so because of the 17% youth unemployment given to them by this and the previous government. They need economic opportunity and it is not available to them today.

It is no accident that we find in this caucus—and I will grant in the Progressive Conservative caucus—a number of younger Canadians, people like myself who are not very long out of university, people who have faced economic challenges in a very real and concrete way.

We will not find among the younger members of these two caucuses professional politicians who have been shifting between municipal councils, provincial legislatures and federal parliaments that have been legislating taxes, tuition increases and cuts in transfer payments for higher education.

We will find people who know what it is like to graduate with $20,000, $30,000 or $40,000 of debt and to try to find their first leg up the ladder in a labour market which offers so little opportunity to young Canadians.

That is why we will find in this caucus, and to some extent in the Progressive Conservative caucus, an appetite for a different approach. Not more big government, Ottawa style programs administered by bureaucrats; not more back to the future of the 1960s and 1970s. We want to move ahead to the 21st century, a 21st century not characterized by a family tax burden which consumes 47% of what the average family earns, not burdened by $600 billion of public debt and not limited in opportunity with a 17% youth unemployment rate.

Imagine a future where tax freedom day comes on April Fool's Day as opposed to the end of June. Imagine a tax burden which only takes 25% or 30% of the average family's income instead of 45% or 50%. Imagine a country which only spends a few billion dollars on debt interest and is able to spend the rest on tax relief, job creation, health care and higher education. That is the kind of country I want to live in. That is why I ran to be in this place.

Speaking of the tax burden, I will run through some of the numbers, but before I do so let me say that the brain drain of which my hon. colleagues speak has a very personal meaning for me. It is not simply an economic concept. I will speak of the experience of my family.

Some of my family are fifth and sixth generation Canadian. I have ancestors who like yourself, Mr. Speaker, descent from the United Empire Loyalists. Mine is a Canadian family which goes back 250 years. I am in a sense ashamed to say that today my entire immediate family—my parents and both of my brothers—are now working and living abroad because they could not find the economic opportunities in Canada they were able to find overseas. They are not happy about the fact they had to leave the greatest country in the world. I am not happy about that fact.

I would like to tell a personal story about my father. My father served in the Royal Canadian Air Force for 11 years as a jet fighter pilot and as a squadron commander of CF-100s at various air force bases. He then went on to teach and become headmaster of several fairly well known Canadian private schools. Those who know about the private school industry will know it is not a very compensatory vocation. People earn far less there than they do in the public school system.