Madam Speaker, given the rule of relevance I will address the bill, but I would like to begin by commenting some of the remarks of the hon. member for Scarborough—Rouge River.
He and other members of his party seem to have taken the occasion of this debate on a technical tax bill to comment at length on the fiscal policies of the Government of Ontario. And well they should. The fiscal policies of the Government of Ontario have been deeply affected by the fiscal policies of the Government of Canada.
Many of the hon. members of the government have spoken about how the government is now offering a cash floor for transfers under the Canada health and social transfer to the provinces and what a wonderful commitment this is to our social programs, to health care, higher education, welfare and so forth. Rarely have I heard such duplicity in this place from a government which has just proceeded from four years of hacking and slashing those very same transfer payments.
The government ran in 1993 on a commitment to increase those transfers and proceeded to cut them from over $18 billion to under $12 billion in cumulative annual cash transfers to the provinces. These cuts had to be absorbed by the provinces without forewarning and without adequate consultation. It was the worst kind of downloading. For these Liberals to stand up in this debate in this place and proceed to criticize the very governments that had to absorb their cuts, the cuts they lied about in the 1993 election, I find really quite offensive.
Of course I would not suggest that any particular member mislead anybody. I am simply saying the Liberal party mislead Canadians in the 1993 election. It is a matter of record.
The Ontario government had to absorb those cuts, as did my province of Alberta. It is very interesting because this government is going to have to see the chiropractor, it has been slapping itself on the back so much about its fiscal policy, a fiscal policy which saw the government cut transfers to the provinces by nearly 35%, while cutting its Ottawa federal government program spending by only 9.3% .
The government did not balance the budget, taxpayers balanced the budget by working harder and paying more taxes while seeing federal revenues grow by $26 billion in the last three fiscal years. At least $8 billion or $9 billion of those new dollars came about through tax increase imposed by this government in this Parliament.
That does not include the huge hidden tax burden of deindexation of the tax brackets which was imposed by the Mulroney government in 1986 and which has been a destructive economic policy continued by this government. The tax deindexation has sucked a cumulative $13.4 billion out of taxpayers since 1993. It has pushed tens of thousands of low income people on to the tax rolls because we have not indexed the basic personal exemptions and the marginal rates. People who should not be paying any taxes are paying them today because of the callous tax policy of the Mulroney Tories and the Chrétien Liberals.
I want to directly address the hon. member's assertions regarding the fiscal policy of the Government of Ontario. He criticized the Ontario government by saying that Canada was cutting debt while Ontario was increasing its debt.
I do not know if the hon. member has ever seen the public accounts of Canada or if he has read any of the budgets of his Minister of Finance. I have and what I see is that since the Liberal Party came to power in 1993 it has added nearly $100 billion to the stock of the national debt. The scandalous $500 billion left to us by the Tories is now nearly $600 billion. That is not a subtraction but an addition.
Most Liberals should be assigned to a mandatory remedial math course because they think adding to the debt means subtracting from the debt. They added $100 billion to it, taking our debt servicing cost up to $47 billion a year. They pontificate about their commitment to social programs but they are spending more on the interest on the debt, the equivalent in tax revenues of $6,000 per family of four. That is how much they spend on debt interest. That is the amount of money spent altogether in the government on health care, education and old age security combined. Just what the government is spending in interest on the national debt, which it has increased by $100 billion, is almost equivalent to the entire annual budget of the Government of Ontario.
The greatest fraud in what we have heard in terms of the fiscal policy of Ontario is that it has made cruel, hard hearted cuts to social services for Ontarians to fund its tax giveaways to the rich. The tax cuts supported by Ontarians and laid out in the 1995 election in Ontario are steeply progressive. People at the bottom end of the tax brackets will feel the biggest proportional impact of the tax relief.
I hope members will listen to me because this is the most important fiscal lesson of the Harris miracle. The revenues in the Government of Ontario have increased since 1995 faster than they were projected to. Yes, it is true, the Ontario government cut the tax rates but the revenues went up because more people are working and paying taxes. The government has not had to cut a dime from any program to finance the tax cuts because the tax cuts have financed themselves through increased economic growth.
It is a Tory government in Ontario but it is unfortunate that the Tory Party here, the red Tory Party here, has publicly criticized Mike Harris' fiscal policy. The hon. member for Markham has publicly said that if the Harris government continues with its hard hearted policies it could affect the federal Tory Party. Imagine a member whose party is at 12% in Ontario saying that the Mike Harris' party at 35% might negatively affect their electoral outcome.
The point is that Ontario government's revenues have gone up as the taxes have gone down. That is why the fiscal policy of the government is not working. As it pushes tax rates up it continues to stagnate economic growth. We continue to see nearly 9% unemployment, 16% youth unemployment and shrinking family incomes. Now we see that our GDP for the last quarter is down for each of the last three months. We now see that our standard of living has declined faster than that of any other country in the OECD over the past 20 years. The government may call that a fiscal record to be proud of but I call it a fiscal record to be ashamed of.
If the government wants to emulate a fiscal record it should look to the Government of Alberta which cut its own program spending not by 9% but by 20% and did not complain one whit about the transfer cuts, the hundreds of millions of dollars in transfer cuts imposed on it by the Liberal government.
It just absorbed those cuts and maintained what are by far the lowest tax rates in Canada, allowing it to create the lowest level of unemployment, the highest level of growth, a shrinking level of poverty and a growing level of family income.
The moral of the story is that lower taxes mean more growth, more revenues and better fiscal balances. That is a lesson that I do not think this government will learn any time soon.