Mr. Speaker, this debate is about the provisions in the recent budget, a budget that was made possible because the Government of Canada carried out the wishes of Canadians. Their message was loud and clear: eliminate the deficit and get our fiscal house in order.
We have accomplished that. Now Canadians will be the beneficiaries of the sacrifices they have made.
This budget commits 80% of new spending to two of Canadians' highest priorities: health care and more opportunities to improve our knowledge and skills in competitive workplaces.
I can think of no better way to direct our resources than to help young Canadians prepare for the 21st century. They are the leaders of tomorrow and we must do what we can to ensure they are able to meet the challenges of the knowledge based economy.
Last year we introduced our youth employment strategy which helps young Canadians make the often difficult transition between school and work. Through programs such as Youth Service Canada, Youth Internship Canada and Summer Career Placements we are helping our young men and young women to gain valuable work experience which will help equip them with the skills necessary for today's labour market.
We will build on these foundations with new measures that encourage youth employment and, equally important, we will ensure that all our youth are given the opportunity to fulfill their education potential.
As the Governor General said in last September's Speech from the Throne, there is no better way to mark the millennium than to invest in Canadian youth. That is why we announced the Canada millennium scholarship fund. Hon. members know that over 10 years the fund will award scholarships to more than 100,000 full and part time students and it will do so annually. It will begin with an initial endowment from the federal government of $2.5 billion.
I have heard concerns expressed that the millennium scholarships will infringe upon provincial jurisdiction and will duplicate provincial programs. I want to ensure hon. colleagues that this will not be the case. The Government of Canada fully recognizes that education falls under provincial jurisdiction, but our history shows that both the federal and provincial governments have worked together to assist Canadians who face financial barriers to learning.
The federal role goes back to the post World War II years when we first provided assistance to veterans who wished to complete their post-secondary education.
There is no need for apprehension regarding infringement. The millennium scholarships will be administered by a millennium scholarship foundation, an independent body which will be at arm's length from the federal government. Part of the foundation's mandate will be to consult with provincial authorities and the post-secondary education community to build upon existing programs.
Since 1964 the Canada student loans program has helped make post-secondary education more accessible by providing students with loans. This government has continued that tradition and in the 1997 budget we extended interest relief from 18 to 30 months for borrowers having difficulty repaying their loans.
Now we are expanding assistance even more. All borrowers will receive tax relief for interest on federal and provincial student loans and we will provide a 17% tax credit for the interest portion of what they repay each year.
Since Quebec does not participate in the Canada student loans program, the province is entitled to compensation if its program has substantially the same effect as the CSLP. With respect to reduction of student debt, the Government of Canada will review provincial measures with Quebec to see if they have a similar effect.
We are also addressing the challenge of helping families finance their children's post-secondary education long before they reach the post-secondary level. The new Canada education savings grant will benefit all families, but especially low and middle income families. The secret is to start early and to make regular contributions. The government will encourage this through the savings grant.
For example, if a family contributed $25 to a registered education plan every two weeks for 15 years, their child would have $4,700 available for each of the four years of higher education.
The previous two budgets included measures to make RESPs more attractive by raising the annual and lifetime contribution limits. The new Canada education savings grant will pay 20% on the first $2,000 in annual contributions for children up to age 18. The maximum annual grant will be $400 per child.
Saving for your child's education through RESPs means you will benefit from the savings grant and the tax-free growth of investment income. The savings grant will make RESPs among the most attractive savings vehicles available for a child's education. RESPs will definitely be one of the best things parents and other relatives can do for their children, for nieces or nephews.
Speaking of children, hon. members will recall that in the 1997 budget we enriched the Canada child tax benefit by $850 million effective this July. We promised further enrichment and we are delivering on that promise in this budget. We are committing an additional $850 million, spread over two years, beginning in July 1999 and again in July 2000.
As well, the budget proposes to increase the dollar limits for the child care expense deduction by $2,000 for children under 7 and by $1,000 for older children. This measure will provide tax relief of about $45 million for some 65,000 Canadian families.
As honourable members have pointed out on more than one occasion, we must continue to address the unacceptably high youth unemployment rate. The youth employment strategy is tackling that problem as will provisions under the new Canadian opportunities strategy. But we are also addressing youth unemployment quite specifically by challenging the private sector to hire more Canadian young men and women.
Employers who hire youth between the ages of 18 and 24 in 1999 and 2000 will pay no employment insurance premiums for those new workers. All companies will be eligible, not just small companies as was the case in the new hires program which ends this year.
It is estimated that this new measure will reduce payroll costs for employers by $100 million annually in both 1999 and 2000.
The budget clarified the Government of Canada's intention to make effective changes in the guaranteed income supplement, GIS, and the spouses allowance program, the SPA.
We will move the beginning of the GIS/SPA payment year from April to July. This will give needy seniors an additional three months to submit their income statements. This will ensure that the income tested payments of these individuals will not be cut off and the definition of income used to calculate payments will be more in keeping with those used for income tax purposes.
I began this debate by saying the budget is the result of sacrifices made by Canadians to eliminate the deficit and ensure fiscal responsibility. I congratulate Canadians for their determination to stay the course.
All hon. members can help us move in that direction by supporting Bill C-36.