Debates of Feb. 25th, 1998

The Budget

[Jean Charest, Progressive Conservative, Sherbrooke, QC]

Mr. Speaker, let us set the record straight. That 3% has not been removed. It is still there for the middle class, among others.

I would like to ask a precise question. In the budget documents the Prime Minister claims that a Canadian earning $35,000 a year will get a total tax cut of $450 over the next three years.

What he does not say is that the same Canadian will see his or her CPP premiums go up by $574 over the same period. Only a Liberal would confuse a tax grab with a tax cut.

Could he explain to Canadians who are earning $35,000 how they will get any relief at all?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I say to Canadians in that situation that the level of UI payments that were increased year after year by the Tories who charged up to $3.30 are now down to $2.70 this year, starting January 1.

We reduced it by $1.4 billion. We reduced the increase of the Conservatives this year again, in a field where they showed what terrible managers they were.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, I am duty bound to point out that the Conservatives supported the huge hike in CPP premiums in Bill C-2.

In the 1995, 1996 and 1997 budgets the finance minister claimed that the $3 billion contingency fund would not be used for new spending. That is what he said. He said “The contingency reserve is not a source of funding for new policy initiatives”.

In yesterday's budget the minister reneged on that promise and blew the entire contingency fund on new spending. Why should we believe the minister's word today when he already—

[The Speaker]

The Minister of Finance.

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, I thank the hon. member for his statement. Last week we had the full monte. This week we have the true monte.

Let me simply point out that we did not use the contingency reserve for new spending. The reason we were able to bring in the first balanced budget in 30 years is that it was used to reduce the deficit.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, now we are just waiting for a Paul that tells the truth.

[Some hon. members]

Oh, oh.

[The Speaker]

I would ask the hon. member to withdraw those words, please.

[Monte Solberg, Reform, Medicine Hat, AB]

Absolutely, Mr. Speaker. I withdraw.

The 1997 budget states “the contingency reserve is not a source of funding for new policy initiatives”. This just does not square with the actions of the government.

In fact, in this year's budget the government spent the entire contingency fund on new spending and the whole debt repayment program is premised on the contingency fund going to debt.

How does he square his actions of yesterday with his words of today?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, I think the hon. member should go back to the research department. Let me be very clear.

The contingency reserve was used to lower the deficit. In fact, it was used to eliminate the deficit. The spending in the budget for students to which the Reform Party objects and the spending in the budget for children in poor families to which the Reform Party objects did not come out of the contingency reserve.

I will explain it many times but I would hope I could get through just once.

[Michel Gauthier, Bloc, Roberval, QC]

Mr. Speaker, the Prime Minister has announced that Yves Landry, the president of Chrysler Canada, will be the chairman of the Canadian millennium scholarship fund.

My question is for the Prime Minister. When he approached Mr. Landry, did the Prime Minister tell him that this intervention in the field of education was raising hackles in Quebec and that everyone involved—students, the academic community and federalists and sovereignists alike—strongly opposed the federal government's intrusion into an area of provincial jurisdiction?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I had the privilege and the pleasure of speaking with Mr. Landry, who understands very well, as we do on this side, the importance of investing in the future of young people throughout Canada, including Quebec. Education is the key to young people's future.

Mr. Landry is highly respected and successful. He will do an excellent job as the chairman of this foundation, and young people across Canada will benefit.

[Michel Gauthier, Bloc, Roberval, QC]

Mr. Speaker, everyone respects Mr. Landry. We have little doubt of his interest in education.

However, did the Prime Minister—and this is my question—tell the new chairman of the Canadian millennium scholarship fund that the position he was appointing him to would put him between a rock and a hard place, that is, at the heart of a potential federal-provincial battle, because no one in Quebec wants Ottawa involved in education?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I hope Mr. Landry will realize that Philippe Leclerc, the president of the Fédération étudiante collégiale du Québec, said this budget put young people's priorities in the forefront.

I hope the hon. member will understand the remarks of Mario Dumont—who is not necessarily one of my greatest friends. He said: “Lucien Bouchard would really like the next election campaign to be run on the back of the federal government, but this attitude of confrontation whatever the cost could well end up penalizing students in Quebec”.

[Jason Kenney, Reform, Calgary Southeast, AB]

Mr. Speaker, with no change in taxation and a massive increase in CPP premiums, we see that yesterday's budget provides absolutely nothing in the way of tax relief. Instead of offering real tax relief, the Minister of Finance chose to increase spending.

Why is the minister spending Canadians' tax relief, when their disposable income and standard of living continue to drop?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, the Reform Party critic seems to be saying that providing tax relief for single mothers is not a tax reduction.

They are saying that lowering taxes for 13 million middle class and disadvantaged Canadians is not a tax reduction. They are saying that helping students deduct their student loan interest is not a tax reduction.

We represent Canadians. I wonder who the Reform Party represents.

[Jason Kenney, Reform, Calgary Southeast, AB]

Mr. Speaker, what this minister has represented is 36 tax increases, including the largest tax increase in Canadian history, bringing federal revenues up by $46 billion from 1993 to 2000, a $5,000 increase in revenues per family.

How can this minister claim this is a tax relief budget when revenues are going up, when taxes are going up, when bracket creep is taken into account, and the CPP? People will pay more, not less, after this budget.

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, let us do a bit of economics 101. The government's revenues are going up. Why are the government's revenues going up? They are going up because there are a million more Canadians back at work. They are going up because Canadian corporations are making more profits, therefore they are paying more taxes and revenues are going up.

Let me explain slowly to the Reform Party. When economic activity is good and when Canadians are going back to work and the economy is booming, then Canadians feel good, our revenues go up—

[The Speaker]

The hon. member for Lac-Saint-Jean.

[Stéphan Tremblay, Bloc, Lac-Saint-Jean, QC]

Mr. Speaker, despite the opposition of Quebec's educational community, despite the opposition of the Government of Quebec and the Liberal Party of Quebec and despite the serious reservations of all provincial ministers of education, the government has imposed its millennium scholarship fund.

Will the Minister of Finance acknowledge that his government's refusal to put money set aside for the millennium scholarship fund into existing provincial loan and bursary programs is intended not so much to help students as to make the federal government more visible to young people?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I think students are entitled to know where the money they receive comes from. That is their right. I do not think this is a great concern for the Bloc.

As we saw recently, the Quebec premier gave out cheques but failed to tell people that 90% of the money was provided by the federal government. It is time for people in Quebec, as in the rest of Canada, to know the truth.

[Stéphan Tremblay, Bloc, Lac-Saint-Jean, QC]

Mr. Speaker, we are talking about $80 million out of $600 million.

What is the Prime Minister's response to his colleague in human resources development who told journalists yesterday, and I quote: “The millennium fund is the best way for the federal government to increase its visibility”?

The government does not care about young people. What counts is visibility.

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I think the minister is quite right. We want to help young Quebeckers prepare for the 21st century. It is right for them to realize that there are advantages to being part of Canada rather than be told all sorts of things by the Bloc Quebecois that have nothing to do with reality.

We think every Quebecker should know that the taxes they pay to the federal government give them something in return. They are going to know it in this case, you can be sure.

[Diane Ablonczy, Reform, Calgary Nose Hill, AB]

Mr. Speaker, older Canadians waiting for news about the seniors benefit were disappointed in yesterday's budget. They thought they would finally have some security. Instead they were shoved to the back of the line while the finance minister blew the surplus on big spending.

Why are the spenders moved to the head of the line while tax relief on retirement savings gets ignored?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, I ask the hon. member are there no students, are there no people with disabilities, are there no seniors, are there no single mothers, are there no people in need in her riding?

Is her riding so choice that there are no Canadians who require help? Are there no Canadians who require equality of opportunity? Does she live in a riding where there are no poor, no middle class? If she does then she is lucky. That does not describe the entire country. We are going to stand—