Mr. Speaker, I appreciate the opportunity to speak today to the motion put forward by the hon. member for Cypress Hills—Grasslands.
The motion proposes that the government dedicate a minimum of 20% of federal gasoline excise tax revenues to joint federal and provincial programs to update or renew substandard sections of the national highway system.
The government appreciates the hon. member's concern for the national highway system and commends him for bringing this matter to the attention of the House. I had the opportunity to work closely with the member for Cypress Hills—Grasslands as co-vice chairs of the Standing Committee on Transport for the House of Commons. I know he has a keen interest in this topic as do many of us on this side as well.
Before discussing the motion, however, I want to take a moment to set the issue in context. Since the beginning of its first mandate back in 1993, two of the government's ongoing priority areas continue to be sound financial management and fairness in the tax system. Balancing these two equally demanding commitments has been a challenge for the government.
With order now restored to the nation's finances and targeted tax relief provided in each budget since 1994, together with broad based tax relief starting in 1998, the government will continue to meet these commitments as resources become available.
Faced with these challenges, the government unfortunately cannot agree to direct part of the revenues from the federal excise tax on gasoline to upgrade or renew highways. Let me explain.
The earmarking of tax revenues, which is the focus of the motion before us today, is a concern shared by many hon. members. The government has several reasons not to direct tax revenues to specific programs.
Earmarking tax revenues for a specific item would limit the government's capacity to redirect federal expenditures according to its changing priorities.
When the hon. member says that the Minister of Finance has sanctioned dedicated taxes, he knows full well that this finance minister has never been in favour of dedicated taxes. In fact, it was our finance minister who appeared before the Standing Committee on Transport and encouraged the committee to look at public-private partnerships.
Revenues from federal taxes, including the excise tax on fuel products, go into the consolidated revenue fund which is used to support a broad range of federal programs that are enjoyed and valued by all Canadians, programs such as health care, post secondary education, seniors' benefits and national defence.
Another reason the government has avoided dedicating tax revenues to specific programs is because earmarking can result in some programs being overfunded while others suffer from shortfalls. Making budgetary and long term investment decisions under a program funded by earmarked taxes is difficult as revenues from taxes fluctuate from year to year.
A third reason for avoiding earmarking revenues for certain activities is that the government believes that potential spending initiatives, including highways, should be evaluated independently of tax sources and examined as competing priorities.
As hon. members know, there are many demands today on the government's scarce resources. Because of this, it is important that the government remains firmly committed to sound financial management. What the government intends to do is to continue to follow a balanced approach to managing the wide range of priorities.
I would like to remind the hon. members of something else because it is important. Highways fall under provincial jurisdiction. I know that provincial governments are pressuring the federal government to invest in highways.
However, hon. members will recall that the federal government has assisted provinces in the past with provincial highway construction projects through a series of federal-provincial cost shared agreements. In addition, about one-third of the $2.425 billion federal contribution under the Canada infrastructure works program went toward municipal roads and bridges.
Although many of these agreements are winding down, the federal government intends to continue working with the provinces and municipalities. In the October 12, 1999 Speech from the Throne, the government announced its intention to implement a new physical infrastructure program to invest in and improve our nation's physical infrastructure.
The federal government stated in the throne speech that it will work with other levels of government and the private sector to reach agreement on a five year plan for improving physical infrastructure in urban and rural regions across the country by the end of the year 2000. This agreement will set out shared principles, objectives and fiscal parameters for all partners to increase their resources directed toward infrastructure. It will focus on such areas as transportation, as well as tourism, telecommunications, culture, health and safety, and the environment.
The answer for highways does not reside solely in seeking more federal funding. In searching for solutions we need to be creative.
As noted in the Speech from the Throne, one of the partners in addressing the infrastructure challenges is the private sector. While not a panacea, public-private partnerships warrant more encouragement. When properly structured, they may provide roads at a lower cost and more quickly than traditional procurement methods.
In conclusion, I cannot support this motion for the reasons I have stated. However, I want to thank the hon. member for raising this important issue in the House. I also hope that the hon. member will find some positive elements in some of the ideas set out in the throne speech.