Debates of Feb. 18th, 1998

Supply

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, it is a pleasure to rise and speak to this motion.

The members of the Conservative Party have raised an important issue. They have referred to relieving Canadians of the onerous tax burden in Canada today. They have spoken of interest relief on student loans, an important issue, the brain drain crisis which is forcing Canadians to move to the United States where they have lower unemployment rates, income tax rates and student debt levels. The Conservatives have also referred to the fact that the standard of living in Canada has fallen like a stone in the last several years. The standard of living is now 25% higher in the United States than it is in Canada.

These are important issues. I am glad my friends across the way in the Conservative Party have raised them. I do believe that when we address these issues and talk about them, we have to talk about them in the context of who is best able to address them. When we are in Parliament we are supposed to be providing leadership to the country. That is a pretty important point. The only way to determine that is to look at the records of the various parties in the House of Commons.

My friend from Skeena pointed out that we had the Liberals and the Conservatives fighting over who had done the best job of managing the economy. It is an interesting spectacle, a little like sending an arsonist out to fight a fire.

In this case let us review the historical record. Let us start on the issue that is most obvious. Let us look at the national debt. There is the absolute record as to the ability of successive governments to keep their spending in line.

What we have seen since the early 1970s is the federal debt rise from about $13 billion. It took a 100 years for the debt to accumulate to $13 billion. Starting at that point, under the Liberal government, we saw the debt start to mount and mount. It went up and up for years. When the Liberal government left office in 1984, it was in the range of $160 billion to $170 billion. In that short period of time, over a dozen years, it had mounted to somewhere in the range of $140 billion. It had gone up a tremendous amount.

In 1984 Canadians across the country said they had had it. They did not want to have anymore debt. They were tired of this government getting ever bigger, providing all kinds of programs that amounted to intervention in people's lives. They were tired of the mounting tax burden that was necessary to feed this voracious government.

At that point they decided to elect the Conservatives. They said they would give the Conservatives a try. In Alberta a lot of us put our faith wrongly in the Conservatives. We had Conservatives around the cabinet table from Alberta. We thought that perhaps now we will finally have some sanity when it comes to making economic decisions.

What happened? We saw the debt continue to mount. We said in Alberta with one voice you have to stop this. But the debt continued to mount. Pretty soon, by the end of the nine year mandate of the Conservatives, it had gone up $300 billion. These are facts that occurred under a government that is supposed to be conservative. What does conservative mean? What does it mean in that context. If it is there to protect the finances of the country and be conservative with people's money, obviously it did not do it. We saw the debt mount by $300 billion under its watch alone. Obviously it was not the answer.

Liberals jump in and say they have done a wonderful job. They have added another $100 billion to the debt. Now we get to the point in the country where the government is balancing the budget on the backs of taxpayers and on the backs of the provinces by cuts to health care and social programs. What is their plan? Their plan, after 30 years of deficits, is to start spending again. I find that extraordinarily frightening. It is absolutely imprudent. It is reckless. Furthermore, it betrays a trust that the government should have established with Canadian taxpayers which is that it recognizes and understands how much taxpayers are suffering today under staggering debtloads.

The Conservative Party has pointed out that the standard of living in Canada has fallen like a stone. It started under the Conservatives. We should point that out.

I refer to an article in the Ottawa Citizen from December where World Bank statistics show the standard of living in Canada for decades was on par with the United States. For per capital income we were two and three in the world. Ten years ago it started to fall. Canada has fallen from third spot to twelfth spot in the world. I am amazed that this has not been more of an issue today.

Sadly, for reasons I do not understand, a lot of people have not picked up on this. The fact is the very people this government is supposed to be serving are suffering tremendously under Liberal and Tory governments.

The article talks about the difference in unemployment rates. It points out that the real unemployment rate in Canada is 18.5% counting all the people who are discouraged and who have given up looking for work. I know my friends opposite will talk about job creation. They have created some jobs.

However, imagine if we would have kept the participation rate the same as it had been 15 years ago in the economy in terms of people participating and looking for jobs. We would have a million more jobs today than we have.

I simply want to say that what we have heard here today is an argument between two different political parties that have both demonstrated by their actions that they are completely unable to grasp the concerns of Canadians and to do anything about it.

Now we are here today in a situation where we have a huge debt, $600 billion, where the average per family debt is $77,600. We have a situation where Canadians pay income taxes, taxes of $6,000 a year just to pay the interest on the debt. That is what the average family has to pay. The average family in Canada today pays $21,000 in taxes, more than what it puts out for food, shelter and clothing combined.

Surely it will start to dawn on my friends in the Liberal Party and certainly on my friends in the Conservative Party after the horrible government they brought us that we must start to reverse this trend.

That is why I was so disappointed to hear the finance minister say in an interview on CBC that they are not going to keep their 50:50 promise, tepid though it was, to start to reduce debt a bit, to start to pay down taxes a bit.

They said “no, really we meant it for later on and now what we want to do is start spending”. I think that is unbelievable. Perhaps the worst thing of all about this is the people who are most vulnerable in Canada today pay the highest price.

I am talking about low income people, people who do not have a lot of skills in many cases. These are the people who are paying the highest price. My leader in December pointed out that he had received a letter from a family in New Brunswick trying to get by on $32,000, a pretty modest income.

Those people were doing their level best. They decided that the mother in the family would stay at home to look after their four children because they believed their children were more precious than anything. They were barely making it. They were still paying $3,000 a year in federal income tax.

The answer is to come to grips with the fact that this debt is killing the country, it is hurting people and we should start to pay it down.

If we do that, the interest payments drop and then we can start to cut taxes. We can ease the tax burden on low income Canadians. That is the answer to helping Canadians. It is the answer to keeping more Canadians in the country instead of seeing them flow south of the border as my friends have pointed out. We need to start doing that.

The answer is not more government programs. Surely by now, after 30 years of spending evermore, we will come to grips with that important point.

I urge my friends on the other side to vote in favour of this motion so that we may once again return to that tradition in Canada that we had of limited government and people who can stand on their own two feet.

[Mac Harb, Liberal, Ottawa Centre, ON]

Mr. Speaker, I want the member to tell us today whether or not his party position has changed on tax cuts. In the past it spoke continuously about across the board tax cuts.

I want him to tell us unequivocally, without budging, nudging or fudging, whether he still supports across the board tax reduction or whether he will support the government's balanced approach to reducing taxes for select people who need the tax reduction while maintaining spending on our social programs.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, the answer is of course we support broad based tax relief, absolutely. We have made that very clear. We have offered up in our latest document $20 billion in tax relief that would help all Canadians because all Canadians have suffered under successive Liberal and Tory governments. We had 71 tax increases under the Conservatives and 37 now under the Liberals, including the CPP tax hike which is going to hurt the most vulnerable Canadians. The government should be ashamed of that action.

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

Mr. Speaker, I agree with the hon. member that government spending is not the answer to the problems of Canada. That is why I am concerned about the big government spending programs like the millennium scholarship fund. That is why the Conservative government reduced government program spending growth from over 15% per year to around 0% growth by the time our government was defeated in 1993.

My question for the hon. member is related to regional economic development. Our party believes in a strong market based economy that all Canadians have access to the levers of and can participate in the economic growth. That means we need regional economic development programs in some regions of the country in order to ensure equality of opportunity. I would like to know the member's position on regional economic development programs.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, I think that is a fair question.

Our belief is that regional development programs have failed miserably. If they had worked people in Atlantic Canada would have all the jobs in the world, but they have not worked.

We take a different approach. We believe first that we should lower taxes across the country. In fact, our tax relief package would deliver over $1 billion in tax relief to Atlantic Canada every year. That would do a lot more for Atlantic Canada than a bunch of patronage programs which simply pass out pork to loyal party supporters of various political parties. It just has not worked in the past.

The second point we would make is the federal government has an important role to play judgment in ensuring that the transportation infrastructure of the country is in good shape. I think that Atlantic Canada of all places needs to have its infrastructure improved, not by giving it to Doug Young, not by giving hundreds of millions of dollars or $32 million to people like Doug Young, but to ensure that it goes to the—

[The Speaker]

The hon. member for Wentworth—Burlington.

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

Mr. Speaker, there appears to be a contradiction in the remarks of the hon. member for Medicine Hat in his support for the motion.

The member repeatedly said the debt should have priority. He said that over and over again. Yet when we look at the motion it does not discuss debt at all. It discusses only tax cuts.

I cannot understand why the member for Medicine Hat would want to support the motion when his own leader has said that debt reduction has priority, yet this motion gives priority to tax cuts. Is he not in a contradiction here?

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, obviously we did not write the motion. It is not perfect but I think at least it goes in the right direction.

We have been in a situation where we have seen taxes go up 71 times under the Conservatives, 37 times under the Liberals. I will not belabour the House with the horrible Liberal record. I think it is time we offered Canadians some tax relief and freed them from the horrible burden that both Liberal and Tory governments have placed on them.

[Mike Scott, Reform, Skeena, BC]

Mr. Speaker, I will try keep my question short. I congratulate my friend on a great intervention. I think he put it forward very well.

I would like to ask him if he would consider that the problem here is a conflict of vision, a conflict between the Liberal-Tory view of Canada in which we have to have a nanny federal government that congers up a new program, a new spending initiative for every problem that comes along, and Reform's vision of a smaller, more focused federal government which lets the provinces and municipalities do more for themselves.

[The Speaker]

We are going to get an answer to that as soon as we get the next Reform speaker up. But now we are going to go to the hon. member for Saint-Hyacinthe—Bagot.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, I am pleased to speak to this motion by the Progressive Conservative Party.

I will say right at the outset that the Bloc Quebecois will be supporting this motion, because we agree with its analysis.

We feel that present student debt levels are horrendous, and that a solution must be found that respects the fact that education and assistance to students is a provincial jurisdiction.

I will leave it to my colleague, the member for Lac-Saint-Jean, to speak to this issue and, in the nine minutes remaining, I will focus on two other concerns addressed in the motion: Canada's high rate of taxation compared to that of the United States, and the issue of unemployment.

The tax burden of Quebeckers and Canadians has always been a great concern of the Bloc Quebecois. Since our arrival in 1993, we have called on the government to take another look at individual and corporate taxation, which has not been reviewed since the late 1960s.

It must be made fairer and the tax burden on low and middle income members of the public reduced. Corporate taxation must be amended so that tax resources now available in the form of unwarranted benefits, particularly for very large companies, are shifted towards SMBs, which are the real source of new jobs, so as to lighten their tax burden and stimulate employment.

Two years ago, we released a 300-page detailed analysis of Canadian taxation, the first since the late 1960s, as I was saying. This analysis says essentially the following: we have the means, if we dust off the Canadian tax system, to reduce the tax burden on low and medium income taxpayers by $3 billion, each year. We are talking about a $3 billion reduction in taxes on the incomes of low and medium income households.

We also concluded from this in depth analysis that we could move $4 billion of the current tax burden, of taxes not paid by the major corporations. We could take these savings and move them over to the SMBs. We are talking about $4 billion, and there would $2 billion left over, which could go to really reducing taxes on small and medium businesses and on the very small businesses, known as the VSBs.

Two weeks ago as well, we released a statement on what we expected in the upcoming budget of the Minister of Finance. On the subject of reducing the tax burden, we asked the Minister of Finance, as we did last June in the election, to reduce it for individuals by fully indexing tax tables.

Indexing has not been used since 1985 and brought in nearly an extra half billion dollars to the government the first year the practice was stopped. Since then, with inflation every year, billions of dollars are at stake.

If tax tables were indexed again, taxpayers would have an additional $2 billion in their pockets as tax refunds in the first year. Two billion dollars is not trifling matter. Only with a return to indexing, which should be standard practice, since otherwise it is a disguised tax, can we avoid making middle income earners pay more income tax than their fair share.

We also sought a targeted reduction in the tax burden in order to lower it from its very high level for businesses in Quebec and Canada. The best target at the moment, which could enable us to give a boost to job creation, is the level of contributions to the employment insurance fund. These levels are far too high for employers and employees and are seen as hindering job creation.

If the forecasts of the Minister of Finance are right, this year, there will be a $7 billion surplus in the employment insurance fund, which will not go to job creation and to increasing benefits to those hit by the scourge of unemployment.

In the coming years, the federal government will have the means to make targeted reductions to the tax burdens of Quebeckers and Canadians.

Why? If the Minister of Finance gives us the real numbers—over the past four years, let us say that his forecasts have been far too pessimistic—gives us figures that are a little more realistic, we will see that, starting this year, or in other words the fiscal year ending next March 31, there will be a recorded surplus of about $2.3 billion.

Starting next year, that is to say the fiscal year starting April 1, 1998 and ending March 31, 1999, there will be an accumulated surplus of $9.5 billion. In 2001-2002, if we make it till then, the surplus will be over $30 billion.

These are not forecasts pulled out of thin air, as the Finance Minister has often accused us of doing, then confirming our figures himself within a few months. These are forecasts based on very conservative hypotheses, conservative in the non-political sense, on the rate of economic growth, the inflation rate, the input of new receipts compared to the average for the last four years. As I have said, that puts us at a surplus of $30 billion for the year 2001-2002.

The Minister of Finance has an excellent opportunity to reduce the tax burden and, if he cleans up the taxation system as well, he will be able to free up still other surpluses to be applied to reducing taxpayers' burden and to job creation.

The Minister of Finance will be in an even better position to reduce this tax burden if he does not implement new initiatives in areas that are already under provincial jurisdiction, which would only increase inefficiency. I am thinking of initiatives in areas like education, health and so on, in which the minister has no business interfering. The federal government does not have jurisdiction over education or health, and ought not to be implementing new initiatives such as those announced during the election campaign and in the throne speech.

We are going to fight against the inefficiency of new initiatives by the federal government in areas already covered by the provinces. And, while we are on the topic of such initiatives, it could, as requested by Canada's premiers at the last first ministers' conference, give back to the provinces what it has taken away from them over the past four years, and what it is getting ready to take away between now and 2003.

Let us not forget—and I hope that people who are listening today and who tune in for next week's budget will remember—that, in 1994, when the Minister of Finance brought down his budget, he unveiled a plan to cut federal transfers to the provinces in the areas of social assistance, post-secondary eduction and health.

These cuts will take place every year until 2003. He mentioned it only once in 1994, but these cuts will be going on until 2003. Between now and then, the federal government will cut $42 billion in provincial transfer payments in these three sectors. Now, he has just announced that it will no longer be $48 billion in cuts by 2003, but only $42 billion. But that is another story.

We therefore support the Progressive Conservative Party's motion, because it looks at three major concerns. First, student debt levels, which are shocking, given that education is said to be the cornerstone of nations; second, we will be fighting for a reduction in the tax burden; and, third, we will be supporting the Conservatives' motion because it addresses the horrendous problem of job creation.

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, I note the member said he supported the motion so I would like to ask him about something which relates to the provincial jurisdiction of education.

The member will know that the motion proposes interest relief on student debt. The facts put on the table were that the average student debt load was some $25,000 a year. The facts did not state that only one-quarter of all university graduates have any debt at all. We are talking about a small number.

For me the issue is accessibility, not the servicing of debt after they have a job.

The member will also know that the unemployment rate for unemployed youth who have a university degree is only 6.5%. For all Canadians who have a university degree the unemployment rate is only 4.5%. The motion addresses university students and graduates who will have the best opportunities of all our youth.

The question I have for the member relates to youth unemployment of which 52% are high school dropouts. They have an average unemployment rate of some 23%. The dropout rate in Quebec is over 30%. If education is provincial jurisdiction in Quebec, what is he proposing be done to deal with high school dropouts which amount to more than 30% in the province of Quebec?

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, what I am proposing is very simple. Since the Liberals came to power in 1993, the average debt level of students in Canada has nearly doubled. Is there not a connection somewhere between this government's policies and students' average debt level? I think it is easy to figure out.

The planned cuts I mentioned in the conclusion to my speech just now, which were initially to cut $48 billion in social transfers between 1994 and 2003, primarily in post-secondary education—in health and social assistance, but in education as well—say it all.

We cannot cut billions in the education sector year after year and think that governments across Canada will be able to absorb all these expenditures without an impact on tuition fees and on student debt levels.

What would I do in their shoes? First, I would start by minding my own business. Education is an area of provincial jurisdiction. Second, I would cancel the cuts planned between now and 2003 in the education sector. It seems to me that that would be the first step, if I were concerned about improving the situation for students and the level of education across Canada. I would give back to the provinces what the government took away from them for education. This will help people and will not be a strictly political gesture to get some visibility as federalists.

[Gary Lunn, Reform, Saanich—Gulf Islands, BC]

Mr. Speaker, I will continue to try to participate in the debate. Leaving all the politics aside, it is fine for the government side to say that you did this in 1984, but the reality is that we are now in 1998 and taxes are choking the country, choking our youth. I hear examples of it over and over again.

I am speaking in support of the motion. I wish I had 10 minutes but I do not, so I cannot make a lot of points. However, I want to say that we must have a tax system which ensures people stay in the country and which works for all Canadians.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, to echo what my colleague has just said, the Minister of Finance seems more interested in passing legislation to his own benefit than lowering the tax burden on Canadians.

[Nelson Riis, NDP, Kamloops, BC]

Mr. Speaker, I am pleased to have a chance to participate in today's debate. The motion reads:

That, in the opinion of this House, the government should lower the tax burden on Canadians and offer interest relief to student loan holders in order to address the brain drain crisis which is forcing Canadians to move to the United States where unemployment rates, income tax rates and student debt levels are lower and the standard of living is 25 per cent higher than in Canada.

When it comes to a vote we in the New Democratic Party will vote against the motion. To me it does not make much sense at all. I am not saying it is totally wrong but it does not make much sense.

First, the motion refers to the brain drain. Do we actually have a brain drain in this country? Interestingly enough Statistics Canada says that we do not. In a recent report from Statistics Canada, according to Mr. Ivan Fellegi, the so-called brain drain is in fact a brain gain. He acknowledges that Canadian skilled workers are leaving the country, with 11,000 knowledge workers having left Canada in 1995, 5,600 to the U.S. of which 1,600 were doctors and nurses. But evidence shows that there is a net brain gain if one considers that Canada has more immigration of skilled workers from the rest of the world than it loses to the United States and other countries.

That same year 34,300 knowledge workers came into the country from the rest of the world. In 1996, 42,600 knowledge workers came to Canada.

Participants in a recent C.D. Howe Institute conference examining this issue concluded that there was no particular problem in Canada with a brain drain.

It is fair to say that the evidence—and I think all of us will acknowledge that Statistics Canada is probably one of the best statistics gathering centres in the world—tells us that part of the premise of this motion is actually incorrect. So set that aside.

As my friend across the way indicated, student debt problems are certainly very serious for tens of thousands of young people, but access to higher education is probably even a greater issue that we should confront. We have to find ways and means of easing the debt burden so many young people have accumulated as a result of pursuing their higher education goals.

I wonder if it is not time for us as a nation to get bold and actually strike away the whole issue of having tuition fees at all. This is not a particularly unique idea. Sixteen of the OECD countries already are tuition free. The majority of OECD countries have tuition free colleges and universities.

A few years ago as a society we determined that a grade 12 education was what was required to be a contributing citizen in the economy of the time. I think all of us would agree that grade 12 is now the minimal standard. Probably grade 16 or grade 18 makes more sense in terms of what is required to become a contributing citizen in the knowledge based economy of the 21st century.

Why not have tuition free universities and colleges? I think my friends in the Reform Party—although I stand to be corrected—are proposing tax cuts to the tune of $2.6 billion. What is interesting is that that is the exact amount of money Canadians spend on tuition fees each year.

We have a choice. This is what the business of politics is all about. Do we give across the board tax cuts of $2.6 billion to everyone, rich as well, or do we invest it in education and training for Canadians? That is the fundamental question we have here between political parties.

We say we should invest it in young people. We should invest it in Canadians. We should invest it in the human resources of the country. It is fair to say it would be the best investment one could make, as other countries have already determined.

Another point however is that tuition fees account for about $2.7 billion annually. If we were to introduce an inheritance tax, which virtually every industrialized country in the world has with the exception of Canada and one or two others, and we exempted the first $1 million in inheritance and taxed only an inheritance above $1 million, we would collect on an annual basis $2.8 billion. This would cover the cost of tuition fees for every student in this country.

In other words, if we did what virtually every other industrialized nation does, if we collected money from the vast inheritances some people receive with the first $1 million being tax exempt, we would bring into the central government coffers the equivalent of all the tuition fees in Canada. It seems to me that would be worthy of some consideration.

We are going to have a budget in a few days. I hope the Minister of Finance sees the value of investing in young people and others who are pursuing better education and training opportunities, and takes this bold step and does away with tuition fees. Fund it from this new tax that virtually every other western industrialized nation has in place today.

It is rather interesting that this motion comes from my friends in the Conservative Party who Canadians totally rejected a few years ago for actually bringing this nation to its knees economically. There were massive cuts to education, massive cuts to health care, massive cuts to social programs, debts skyrocketing. Canadians said “We have had it with these guys. We are going to toss them out so far that we can hardly see them”. There used to be Tories packed into this place. Now there is a little group down at the far end. Then they were replaced.

[An hon. member]

What about the NDPs?

[Nelson Riis, NDP, Kamloops, BC]

We have always been a small group at this end. Nothing changes particularly for us.

Then it changed and now it is Liberals. I suspect that when Brian Mulroney gets up in the morning and reads the newspaper he cannot believe what the Liberals have done. They have done things that he only dreamed of doing. Massive, massive cuts to education. Horrendous cuts to health care. They have almost completely wiped out all the major granting agencies. There have been huge cuts to social programs so that this morning we now have 1.5 million children living in poverty.

Other countries have no children living in poverty because their parents do not live in poverty. Countries such as Norway and Denmark do not have people living in poverty. They have no children waking up in the morning who live in poverty. We have 1.5 million.

We have 400,000 young people who do not even have a job. They should be working today. Since the Liberals took office, 200,000 young people have been added to these rolls. There are 1.5 million people without a job and another million people working at part time jobs. Yet the Minister of Finance and the Prime Minister stand up and say that the economy is strong, that things are going well.

Somebody said the other day it is like having the Titanic economy. Remember that two-thirds of all the wealthy first class passengers were rescued and two-thirds of all the people in steerage were locked down below and drowned.

Yes, we have a recovery for bankers and banks, wealthy people, corporations and wealthy families. Things have probably never been better for them. However for the average person things are rough. For the unemployed things are rough.

I just came from a conference this morning sponsored by the Canadian Labour Congress, a special interest group I am told by my Liberal friends. It is interested in labour. What was the name of the conference? Jobs. Do we hear of the government having a three day conference on jobs in this country? No, we do not. The Canadian Labour Congress two blocks from here is having a conference on jobs, trying to find ways and means of getting people back to work.

The Prime Minister and the Minister of Finance stand up here and say “Do not worry. Unemployment is down to eight point some per cent, to just under 9%”. It was at 9% for 87 consecutive months. Are we supposed to be joyous at the fact that it has come down a quarter of a percentage point? This is embarrassing. It is probably immoral that we stand here and accept this immorality of having so many people unemployed.

I want to relate a point that was raised at the conference this morning at the Chateau Laurier sponsored by the Canadian Labour Congress. They talked about a woman who a few months ago had a good job in Winnipeg, Manitoba. She had a condo and a car. She was doing well. Then they experienced layoffs in the business. She lost her car, lost her condo, lost her job and is essentially homeless. She has gone from being a productive citizen with a meaningful job living in a community to being homeless in a few months. That is how close most people are to that status.

I will sit down now because my time is finished. I cannot support this motion. It really fails to deal with the crucial issues confronting our country. Let us hope and pray that when the Minister of Finance stands up here next week on Tuesday afternoon he will have something to say that will actually address these serious problems of unemployment.

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

Mr. Speaker, I appreciated what the member had to say. I cannot agree with everything of course. I used to support the NDP at one point earlier in my life. However, I found out that its policies do not work and I became much more realistic.

One of the concerns the people of Saskatchewan have is that one of our main exports is young people. Why is that happening? Why are the young people leaving Saskatchewan? It is plain and simple. There are not any jobs available for them. Very few jobs are being created in that province.

Why are there very few job opportunities? Saskatchewan has the highest taxes in the country. What would happen if there were broad based tax cuts?

Let us lay politics aside. Let us forget about the left and the right and all the rest of it.

The question I have for the member is what creates real jobs in this society?

It is good to talk about education. However, in Saskatchewan we have a very low unemployment rate. Why? Because there are very few people looking for jobs. There are very few people left in that province because there are very few job opportunities. I agree with the member that there should not be cuts to education. We should not be making our young people pay the price for the debt and the high taxes.

However, what creates real jobs in this country? It is not more government programs. I hope the member would agree with that. Would the member agree, as has happened in many places around the world, that if we reduce taxes we begin to allow investment to take place and we allow people to keep their money so they can buy goods and services that produce real jobs.

Would he agree that is the main problem which young people face today? Education is important, but they can have all the education in the world and it will do them no good when it comes to getting a job.

What creates the real jobs in this country? That is the debate we should have. Let us lay politics aside and find out what creates the real jobs. That is what we should be doing in this place.

[Nelson Riis, NDP, Kamloops, BC]

Madam Speaker, my hon. friend probably knows this but Saskatchewan has the lowest unemployment levels in Canada.

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

Because all the young people leave.

[Nelson Riis, NDP, Kamloops, BC]

No, it is because it has one of the hottest economies in Canada.

By the way, it was the first province to have a balanced budget. My friend forgot to mention that fact, as well as the fact that it has the lowest unemployment in Canada. These are realities that my friend forgot to mention.

The member said that tax cuts create jobs. I remember Ronald Reagan saying that when he was president of the United States. He gave tax cuts to the rich. It was the trickle down idea. Give the tax cuts to the richest families in the United States and eventually the benefits would trickle down to the regular folks. Regular folks got sick of being trickled upon. That is what happened. Unemployment went up. The debt load went up. The economy went down. It was an economic disaster. Ronald Reagan bankrupted the United States. I will let the facts speak for themselves.

My friend asks if government can play a role in job creation. Yes it can. I will give my friend an example.

In the city of Kamloops we have a program, like many other communities across the country, called community futures. It is sponsored by the federal government. It is one of the few federal programs which I think really works well. Basically it provides support for individuals on employment insurance to create small businesses. It provides loans of up to $75,000 to entrepreneurs who want to start a small business.

In the city of Kamloops alone, using this microcredit arm of the federal government, 850 new businesses have been created. Normally each business has two or three employees. The odd one will have more. These small businesses are thriving. Every loan has been paid back. There have been 850 new businesses and about 1,500 new jobs created in the city of Kamloops alone.

That is something which the federal government has done and has done really well. People appreciate that. We should be expanding those kinds of programs so people do not have to go begging to the banks for the $50,000 loan to start their small enterprise. That is something the federal government could do. It is doing it now, but it could expand the program to create thousands and thousands of new businesses and job opportunities across the country.

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

Madam Speaker, it is a pleasure to be here today to discuss this issue, although it is not a very pleasant issue. I was the seconder of this motion and I was a factor in convincing our caucus to use our supply day to discuss what we consider one of the great problems in this country and one of the great pending tragedies for the next generation of Canadians that will help to contribute to our economic growth.

The problems of student debt are way greater than a student problem. It is a Canadian problem. It is the Canadian taxpayer's problem. We must deal with it as such.

The cost of having student debt in Newfoundland in particular and in the rest of Canada is reduced access to education. Education becomes an elitist kind of approach where individuals can get educated only if they have significant personal wealth. In many families that is simply not going to happen. Many students in many parts of the country are being discouraged from getting an education.

We all know that job opportunities and education go together. It is really a penny wise and pound foolish kind of policy to have a situation where we effectively discourage people from getting educated. The future growth of Canada is definitely at stake if we do not do something with this student debt problem. Again, I say this is one of the reasons that our caucus has made this one of the most important policy matters that we want to deal with.

We know we have to try in opposition to influence the government to deal with real problems in Canada. This real problem in Canada seems not to be fully understood by the Government of Canada. Our job in opposition is to bring it to the attention of the Government of Canada and to see if we can find solutions to the problem.

The problem is horrendous and huge. There are 1.5 million students presently enrolled in Canadian post-secondary institutions. Collectively these are the youngest and brightest people who are trying to get ahead in Canada, who are doing the most for the future of Canada and for themselves and for their future families. Those 1.5 million students now owe collectively $6.9 billion. Most of them do not have anything but a part time job, working on an education.

There is a tragedy brewing in this country if tuition fees and education costs continue to rise. This country cannot grow into the next century. This new millennium we all want to talk about is going to be an apprehensive place for a lot of those students once they graduate.

One of the other problems we have, besides having tremendous student debt, is that we have tremendously high student unemployment. We can brag about the employment rates in this country that may be 8% to 9% for adults. The Stats Canada figures for the real unemployment rate below 30 years of age is 16.5%. In Newfoundland where I come from it is 23.5%, statistically proven. In real terms in Atlantic Canada if the truth were known for those students and young people who are still in Atlantic Canada we probably have an unemployment rate well in excess of 30%.

That causes the other great problem which Atlantic Canada and in particular Newfoundland have been all too familiar with, the problem of out-migration.

The member for Kamloops is wrong if he thinks that Canada has a net brain gain. We have more people leaving Saskatchewan, we have more people leaving Newfoundland. Where are they going to? There was a time when we could export some of our most uneducated people out of Atlantic Canada, out of Newfoundland to parts of central Canada.

Central Canada is going to find out and British Columbia is going to find out that a lot of the job opportunities for our new students who have tremendous debt, who need to go to areas where there is lower taxation, higher rates of pay and greater opportunities, when they want to visit their children or their grandchildren they better have a passport to visit them because they are not going to be in Canada.

I am going to quote a very prominent Liberal on this problem because sometimes I think the Government of Canada does not really take into account where this problem came from. This is a letter from one of our well known Liberal premiers who was a Liberal cabinet minister. When asked by my colleague from St. John's East the premier of Newfoundland answered: “The rising cost of post-secondary education is due in part to the reduction in transfer payments that was particularly targeted to post-secondary education”.

It is not a coincidence that over $6 billion in transfer cuts have happened since this Liberal government took office in 1993. It is not a coincidence that there is also $6.9 billion worth of debt for students in this country. It is not a coincidence that the provinces of Canada took the cut in federal transfers and simply transferred them to somewhere else. The federal guys transferred the cuts to the provinces, the provinces transferred them to the universities and the universities did what? They transferred them to the students. That is where the $6.9 billion of debt comes from.

As I said, with the effects of that transfer to students across this country some have taken the most terrible of all courses.

In Newfoundland they have actually chosen not to go to universities or colleges. They have chosen not to get educated. They see examples in dying rural communities where people are saying what is the point of getting educated. What is the point of my degree if I owe $30,000 and there are no jobs? I might as well not have gone at all.

For Canada that is the most expensive and tragic alternative. We all know there is a direct correlation between education and employment. If you choose not to get educated you will live on the social welfare system of Canada for the next 40 or 50 years of your supposed working life.

Another terrible tragedy from this terrible debtload is bankruptcies. Almost 8,000 bankruptcies are from students. These are not people who went into business. These are not people who have mortgages on their homes. These are not people who have travelled extensively and who have wasted money. There were 8,000 young Canadian declaring bankruptcy in 1996-97. It was because they went to school.

Another tragedy is the collection agencies, which this government should do something about. I know one of those agencies is based in the U.S.

Talk to parents who are trying to help their children pay off their loans with their savings. Some become targets of collection agencies when their children who cannot pay the loans themselves move within or outside of Canada. It is nothing short of mafia style collection tactics. I could give song and verse about some families in Newfoundland that are digging into their meagre savings accounts.

I have a letter from one parent whose daughter owes $19,000. The mother has $16,000 in savings and the collection company will not take it. Unless you pay it all, it does not want anything from you. The out-migration is unbelievable.

If we do not educate students at a reasonable cost we will have another great problem. Where is the source of future economic growth in Canada? In the year 2006 of the new millennium who will buy cars and houses? Who will have the money? Who will have the money to pay into the Canada pension plan to keep members of our age group reasonably content? Where is the economic growth? It comes from well employed, well paid people who pay taxes to this country. That is not going to happen.

The finance minister has solved our deficit problem for the late 1990s but I think he will create a huge economic and social problem 10 or 15 years from now when a large number of people cannot work and cannot spend on consumer goods.

Entrepreneurship and small business is such an important part of Canada's future growth. Small business creates most of our jobs. We all know that if you are going to get involved in a business you had better have some net personal worth when you go to the bank. I met a young lady the other day with a masters in engineering. She wants to start a business but she owes $57,000. Go down to one of our chartered banks and say that you have this great business idea. Guess what it will say? No business loan, no job creation, no real constructive place for you in Canada.

As the member for Kamloops said, it is all a matter of making choices. There are choices. We can decide to freeze tuition. We can decide to lower student debt. We can forget this millennium fund which will help somebody somewhere in the future. Instead we can help students in our universities today who will graduate this year.

I know. I went to a university in Newfoundland and I had free tuition. It works. A whole generation of us who went to university in Newfoundland in 1965 to 1970 had free tuition. Guess what? There was a whole generation of us who got educated, never had to draw unemployment insurance over 30 working years and contributed to the economy.

The investments that countries like Ireland are making into free tuition, the investment that Newfoundland made into free tuition from 1965 to 1970 are bold, visionary and they work. That is what this country needs when it comes to student debt. It does not need something called a millennium fund for some scholarships for some students. It really needs to get a handle on the cost of education and the idea that if we do create an educated workforce we will have jobs into the future and we will have a very successful country. I can only urge the Government of Canada to start paying attention to this very tragic problem.

[The Acting Speaker (Ms. Thibeault)]

I see many members rising to speak so I will consider two one-minute questions.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Madam Speaker, I would like to ask a question, but first of all I would like to make just a few comments.

It seems that the parties, whether Progressive Conservative or Liberal, are totally forgetting what has been going on in this country.

We need to look at what has been going on in this country and at why we have lost jobs. Many jobs have been lost because of technology.

I have used the example of the Brunswick mine in comments I have made here in the House before. It used to have 1,400 employees and produce 8,000 tonnes daily. Today, with 800 employees, it can produce 10,000 tonnes daily.

Many jobs have been lost in the Atlantic region because of the problems with the fisheries. In Newfoundland, fish plant closures have done away with many jobs.

My colleague from the Conservative Party who has just spoken cannot bring himself to say that free trade is responsible for the loss of many jobs. Perhaps if we quit giving our jobs to the Americans, Canadians would have work too.