Mr. Speaker, I find it interesting to hear the Reform Party quoting Shakespeare. I would have expected Homer Simpson instead. In any event, we will get to that a little later in the debate.
One of the things that I and I think Canadians find most interesting is the cries of indignation only come in this place. Take any of the journals of the fifth estate, take any of the headlines, just pick the newspaper, and it is really quite remarkable how this budget has been received. You ask yourself why.
I think the most telling thing that our finance minister said in his speech was not only is this a balanced budget, but it is a budget with balance. The opposition parties are wrestling with what to do and say about this.
One of my colleagues said to me before the budget that you will know that this is a successful budget if everything you hear is we didn't do enough. Go through it. We can take the Conservatives who would say in their program that they would grab a 10% income tax cut right across the line. It does not matter, as one of my colleagues said earlier. If you make $500,000 you will get a 10% cut, if you make $25,000 you will get a 10% cut. They would say that we did not do enough in the area of tax cuts.
From the document we see that the amount of income that low income Canadians can receive on a tax free basis will be increased by $500. That does not sound like a lot of money, but if you are a low income Canadian, that can make the difference between feeding your kids the way you want to and struggling and having to go to a food bank. In fact, it relieves 400,000 Canadians from paying any income tax at all.
Did we do enough? Is there a person in this House who would not rather stand here and say we would like to give them $1,000 instead of $500 in tax free allowances and tax free earnings? Of course we would.
When you look at the balance and the responsibility of the government governing for all Canadians, we believe that it is a good first step for low income Canadians who at least put some money back in their pocket which gives them a chance to get ahead.
The 3% general surtax was a gift from Brian Mulroney to the Canadian people. We eliminated it. Clearly, 13 million taxpayers with incomes up to about $50,000 will no longer have to pay that. Would we have liked to have done more? Yes. Would we have liked to increase that ceiling? Obviously we would have.
Once again, when we look at the balance requirements, we can only do so much in this budget and still maintain that balance.
I hear talk about managing student debt. The NDP would say we did not do enough. Once again there is that premise. It is a good budget we hear, but they did not do enough. The New Democrats, of course, would like to eliminate any requirement for a student to pay anything for post-secondary education. They are open and honest about that. We do not believe that is good balance. We do not believe that the Canadian taxpayer can afford that.
What have we done? We have provided tax relief for interest on all students loans. We would have liked to have done more, but we have to be reasonable. We have provided interest relief and extended it to more graduates. We have provided an extended repayment period for those who need it. However they have to demonstrate that they need it. There is nothing wrong with that. If they need the help, this government is prepared to provide it.
There will be an extended interest relief period for individuals who remain in financial difficulty. There is no point in forcing our graduates to struggle with a huge debt. We want to be able to help them. We have committed to do that.
We have even said that we will reduce the loan principal amount for individuals who face severe financial hardship.
That is a balanced approach.
We have heard people say that we have not done enough to help people upgrade their skills. One of the things that I see in my riding, when I look at the demographics of Mississauga West, is that a lot of people have made career changes. A lot of people in my riding are looking for a way to improve their skills and increase their training. They are entering a whole new way of life. It could be in the software or hardware industry of computers. It could be in some form of communications technology.
That is very difficult. These people may be 45 years old. They have been working for 20 years, since they left school. They have managed to build up some retirement savings, but their company has downsized. We all realize what that means. Not only do governments downsize; the corporate world has been feeling the pain for the last decade. We understand that. The translation is that when the corporate world adjusts, it usually hits the human resource element.
There may be a 45 year old man who has RRSPs. Up until now he has not been able to touch the RRSPs to spend the money on his improvement without paying taxes. We are providing a system whereby tax-free withdrawals can be made from retirement savings plans for lifelong learning. That will begin on January 1, 1999. Canadians will be able to make tax-free withdrawals from their RRSPs for lifelong learning.
Once again that is a balance. It says to the Canadian people “We have to be creative. We have to find new ways to use the resources which you have put aside”. Let us face it, a retirement savings plan is a tax haven for future retirement.
There is a repayment plan tied to that, and so there should be. Ten years or 20 years down the road when that 45 year old turns 65 and is ready to retire, they will have had an additional 20 years of earning. However we do not want them to be without RRSPs. They must pay them back or they will become taxable.
Again it is fair. It is a reasonable approach and Canadians understand that.
Let us talk about tax reductions. In my constituency there are an awful lot of people who still have young children either in elementary school or in high school. We are providing the Canada education savings grant. The phrase which is used in this document is that it is a new reason to save. It is a clear incentive. It is built with balance.
For example, if a family contributes $25 to a retirement education savings plan every two weeks for their child's education, a total of $650 a year, they will receive a grant in addition to that from the government of $130. That is 20%. On 20 cents out of every dollar they will get an additional grant.
If the family has three kids, or the proverbial 2.2 kids, and it makes those contributions for each kid, it will amount to a substantial amount of money to help a young person go to school.
If that family contributes $25 every two weeks, over 15 years, assuming a 5% return on the investment, which I think is a prudent assumption, that child will wind up with $4,700 for each of the four years they will spend in higher education.
What is this budget about? It is not about the opposition members hammering the government and it is not about the government simply blindly defending it. This budget is about young people. It is about people like Nicky, Harris and Dell, nine and ten year olds in Mississauga who are starting out in life. It is about young David Bond, with his wife and two babies at home, working as a chef in Mississauga and what the future means for him. It is about health care and education. In fact, 80% of the budget goes to those two items directly.
I am very proud to be a Liberal. More important, I am proud to be a member of this place which has put out a balanced budget that will secure the future for all Canadians.