Debates of Dec. 16th, 1999

Points Of Order

[Michel Gauthier, Bloc, Roberval, QC]

Just a point of information, Mr. Speaker.

[The Speaker]

I think I have a good idea to deal with all we have to deal with today, if you will leave it with me.

Does the hon. member have unanimous consent to deposit the information today? Is it agreed?

[Some hon. members]

Agreed.

Interparliamentary Delegation

[Maurice Dumas, Bloc, Argenteuil—Papineau, QC]

Mr. Speaker, pursuant to Standing Order 34, I have the honour to present to the House, in both official languages, the report of the delegation of the Canadian interparliamentary union group which represented Canada at the 54th session of the United Nations General Assembly held in New York City from October 25 to 27, 1999.

I ask for the consent of the House to table this document.

[The Speaker]

Does the hon. member have the consent of the House to table this document?

[Some hon. members]

Agreed.

[Michel Gauthier, Bloc, Roberval, QC]

Mr. Speaker, according to the information I am getting, and it is contradictory, in the case of the hon. member for Argenteuil—Papineau, we are talking about the tabling of a report.

In the case of the hon. member for Surrey Central, it is concurrence in a report. It is not the same thing. Correct me if I am mistaken.

If the hon. member is asking for concurrence in that report instead of tabling it, the answer is no, there is no consent. This is what I wanted to say earlier but you were not listening, Mr. Speaker. You are letting me down at the end of this millennium. This is my last point of order.

[The Speaker]

There is no other way to say this other than I made a mistake. I wish the House would get me out of this jam somehow. I understood that this was simply a request for unanimous consent by the hon. member for Surrey Central to table this document. In good faith I thought the two requests were the same, but they were not the same.

Quite frankly, I do not know how to get out of this whole thing because I just made a decision. I will let the whips get together for a few minutes to see if they can come up with some way out of it. If they can, I would appreciate it very much. I will await their decision.

There have been discussions among the whips, and thank God for the whips. Let us see if we can get it right this time.

Colleagues, with your permission, I will start over. The hon. member for Surrey Central, as I understand, wants concurrence in a report. I will put that question first. Is there agreement for concurrence in this report?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[The Speaker]

Now I will deal with the question from the hon. member for Argenteuil—Papineau.

He only wanted to table the report of an interparliamentary delegation.

I will now put that question. Is there agreement that he be allowed to present his report?

[Some hon. members]

Agreed.

The House resumed consideration of the motion.

Standing Committee On Finance

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Mr. Speaker, it is with pleasure that I now conclude my remarks after question period.

Today's Globe and Mail editorial was very insightful. It was entitled “The Surprising Legacy of the Minister of Finance”. It describes the elimination of the deficit as the single accomplishment of the Minister of Finance.

It says specifically that the finance minister's triumph on the deficit is shadowed by wrongheaded policies elsewhere. Of course, we have already established, as the Economist magazine reported, that the credit for deficit reduction in Canada belongs largely to the structural reforms made by the previous government. Therefore, the finance minister cannot really claim that one-hit wonder because he did not really author that one success. Although the finance minister would like to claim being a one-hit wonder, he cannot claim even that to his credit.

Let us look at some of the policies he has implemented. While it is terrible for Liberals to shamelessly take Conservative policies, to implement those policies and then to take credit for the impact of those policies, what would be even worse would be Liberals implementing their own policies. That is what I am concerned about, because we are starting to see a few of those policies rear their ugly heads.

A year ago, the finance made his no decision on the bank mergers. What has been the impact of that decision? I described earlier the complexities and challenges of the increasingly interconnected, globally competitive environment. In that environment, since the minister's decision, Canadian banks have lost about $9 billion of shareholders' value. During the same period, American banks have increased in value by about 10%. Again, as Americans are getting richer, Canadians are getting poorer.

In making his short-sighted decision on the bank mergers, and refusing to stand up to the banks to defend the long term interests of Canadians by negotiating a better deal on behalf of Canadians in exchange for mergers on issues like jobs, services to rural communities and those types of things, and in unilaterally and arbitrarily saying no, the minister has effectively put his own short term political interests and those of his leadership aspirations ahead of the interests of the 7.5 million Canadians who own bank shares.

Yes, 7.5 million Canadians, directly or indirectly, own bank shares and are depending on the returns of those shares for their retirement funds. Again, that was the minister's decision on those issues.

The minister has failed to address some of the major crises facing Canada right now and the need for significant and broadbased tax reform and tax reduction. On the personal side, we need significant levels of tax reform. On the corporate side, we have, as I mentioned earlier, the second highest corporate tax rates of the 31 countries in the OECD. Last year Germany had the second highest and we had the third. Germany now has the third highest because it has reduced its corporate tax burden. This country continues to cling to the notion that we can tax to death our companies and our individuals and yet still enjoy some level of economic growth.

In this current environment, we should be undertaking significant levels of tax reform. We should be taking the same courage and vision in our approach to policies that the previous government took with policies, such as free trade, GST and deregulation. In our dissenting report, we discussed the need for broadbased and forward thinking tax reform both on the personal and corporate side.

The government received an excellent report on corporate taxation by the Mintz commission. It addressed many of the significant flaws in our corporate tax system. If implemented, it would address the distortionary nature of our corporate tax system, the profit and sensitive taxes that currently create significant distortions and damage productivity in Canada.

The Mintz report also identified the need to bring our corporate tax regime more in line with those of other countries. At a time when other countries are using corporate tax reform and personal tax reform as vehicles and levers for economic growth, including Ireland and the Scandinavian countries, this country continues to cling to the past.

In our minority report, we identified that tax brackets should be re-indexed. In fact, there is a consensus both on the left and the right that we should be returning to full indexation of the tax brackets. The Fraser Institute agrees with the Caledon Institute in this case. The de-indexation of tax brackets took place during a time of deficit financing in a very difficult fiscal period. In a post-deficit time now more than ever, we need to revisit and eliminate bracket creep which has unfortunately brought more Canadians onto the tax rolls than we have ever had before and we need to revisit that, eliminate bracket creep and re-index tax brackets.

We need to lower the capital gains tax rates. I was pleased to see that the finance committee report did address this to a certain extent. We would go further. We would reduce the capital gains inclusion rate to 50% from the current 75%. The fact is that we could reduce our personal capital gains tax rates to be equivalent with those of the U.S. It would cost about $240 million per year. For the dramatic unlocking of capital that would occur and for the economic growth that would ensue with that type of visionary policy, $240 million per year is a small price to pay.

Unfortunately, public policy, in particular for the Liberal government, is focused more often on perception rather than reality. There is a stubborn intransigence in areas of capital gains tax and corporate tax reform. That is why the government has shelved the Mintz report and ignored many of its recommendations.

We would like to see the government set and keep firm debt reduction targets. This is very important. Our country is now in a worse debt to GDP ratio situation than those countries of the EU. We would not qualify under the Maastricht treaty to participate in the common currency of Europe. This is comparing Canada with bastions of fiscal fortitude like France. It is not exactly a positive indicator that we have not been able to maintain the same or lower debt to GDP ratios than our cousins in Europe.

We would suggest that the foreign content limit be increased to 50% immediately, and ultimately be eliminated once we have had an opportunity to evaluate the impact of it. The finance committee is recommending some level of incremental increase over a period of time.

I would argue that at this stage, with the dramatic infusion of capital into the Canadian equity markets, with the Canada pension plan funds and the superannuation funds that we are going to be seeing, there has never been a better time than now to end this economic imprisonment that forces Canadians to accept lower returns, which have cost about $32,000 to the average RRSP over time.

During a time when the Dow Jones has appreciated 300%, the TSC has performed in many ways anemically, gaining about 100%. I referred to it earlier as fiscal or economic imprisonment. I think it is very important, in particular while the government clings to the types of tax and regulatory policies that will pummel initiatives in Canada, that it release Canadians and allow them an opportunity to invest some of their hard earned dollars to ensure that they can enjoy a relatively good quality of life in the future.

We would suggest that the government take very seriously the call for a national highway program and that it increase the proportion of gas taxes that are currently returned to the provinces for highway spending from the current 5%, which is the lowest of any industrialized country, to about 15%.

This is an area of utmost importance. While there is some need for new spending in some of the traditional areas such as health care, and the farm crisis and the highway system need to be addressed, the government should not engage in new spending programs, including the child care initiative in which some Liberal backbenchers want to engage.

At a time like this in Canada, when we have never faced more fierce global competitiveness issues, we need to take time to step back and evaluate what is happening in other countries. Other countries are dramatically using innovative tax policies to create levels of economic growth. Other countries are reducing and maintaining lower levels of government spending and lower levels of debt to create the economic environment that will ensure growth.

Other countries are taking on regulatory burden. One of our suggestions is that we have a regulatory budget to allow elected members of the House to debate the merits of individual pieces of regulation so that we do not see a continued growth of regulation by stealth.

This is my last speech of this millennium in the House. I would hope in the future, in the next millennium, that we would take more seriously the competitiveness issues facing Canadians and that we would actually lead the global environment to create a better environment, instead of simply following and playing catch-up, as the government seems want to do at this time.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, I want to thank my friend for his thoughtful speech. He is a great asset on the finance committee and thinks a lot about these issues.

I have a question for my friend. Many of his colleagues in the Conservative Party have advocated enriching employment insurance benefits. Would he tell me what his personal stand is on that issue and what is the stance of his party?

If I do not have another opportunity, I also want to wish all members a Merry Christmas and a happy New Year.

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Mr. Speaker, I thank the hon. member for Medicine Hat, my friend and colleague on the finance committee, for his question.

Employment insurance benefits, particularly those relating to seasonal workers, is a very important issue. The Liberals slashed these benefits after 1995. That created a situation which I do not think even the government expected, and the law of unintended consequences kicked in.

In many cases the slashing of those EI benefits resulted in people who worked seasonally going on provincial social assistance rolls and not working at all. I would assume that the hon. member would agree with me that that created a greater reduction in productivity and human enrichment than would have existed previously.

That being the case, my personal views on this would be that we should investigate and revisit the notion of individual EI accounts. There was a study done in the U.K. a couple of years ago. It was reported in the Economist magazine in the fall of 1997. It studied the idea of having individual EI accounts that people would pay into over their lives. Some of the contributions would be taken from those individual accounts to top up those who draw more frequently.

That type of change would provide an incentive for people to not draw frequently. It would have some of the impact which I believe the Liberals were trying to seek in terms of reducing abuse of the EI system by way of an incentive method, as opposed to purely through a penalty or punishment oriented method that ultimately did not have the effect Liberals wanted.

I am sure the hon. member agrees with me that shifting the burden of social assistance to the provinces certainly did not help in any way, shape or form. In fact it prevented many of these people from participating in the workforce.

It is a complicated issue. There is not a simple, 12 second answer to that. However, I would enjoy exploring the issue with the hon. member at any time in the future.

[Dan McTeague, Liberal, Pickering—Ajax—Uxbridge, ON]

Mr. Speaker, I rise on a point of order. I understand that this may be one of the last few days or minutes that we have in the House.

A great amount of work has been expended by members from all sides of the House in committee to come to an agreement on Bill C-202, which is currently at report stage. It is a private member's bill which deals with high speed chases. Given that there is unanimity among the parties and the members, I would seek unanimous consent to have the bill now read and determined at third reading to pass on to the Senate.

[The Acting Speaker (Mr. McClelland)]

The hon. member for Pickering—Ajax—Uxbridge has asked for the unanimous consent of the House to see Bill C-202 as having been read at third reading. Is there unanimous consent?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[Sophia Leung, Liberal, Vancouver Kingsway, BC]

Mr. Speaker, I am pleased to take part in the prebudget debate. I am sharing my time with the hon. member for Leeds—Grenville.

As the member for Vancouver Kingsway, I hosted a successful prebudget consultation in my riding. I wanted to hear from British Columbians their concerns and ideas on spending the surplus. Those citizens discussed and shared what they believe the priorities should be for the next fiscal year.

A clear priority which emerged from that discussion was the need for tax cuts. However, tax cuts were not to be at the expense of important social programs such as health, education and poverty.

Vancouver also faces the serious challenge of homelessness, and many of my constituents expressed grave concerns about this issue.

I did not only listen to the people in my riding. As a member of the all-party Standing Committee on Finance I was able to hear from and speak with many Canadians from British Columbia, the western provinces and indeed across the country. In this very public consultation process we heard the needs and wishes of many Canadians.

Canadians were very clear about the direction the next budget should take. They want tax cuts and debt reduction. They want infrastructure development and improvement in all provinces. They want homelessness and affordable social housing needs to be addressed. They want the serious shortfall in core funding for universities and colleges to be reversed. Canadians, whether in British Columbia or Newfoundland, know what they want and we listened.

Members of the committee spent long and careful hours analyzing and discussing what we heard. Our recommendations, based on what we learned from the public consultations and town hall meetings held in many ridings, including Vancouver Kingsway, are found in our committee report which was tabled in the House of Commons only a few days ago.

I would like to take a moment to commend the committee chair and the members of the finance committee for their hard work and dedication over the last few months of the prebudget consultation process. I would also like to thank the hundreds of Canadians, individuals and organizations, who took the time and effort to participate in the prebudget consultation process. All made highly valuable contributions to the shaping of the committee's report and recommendations.

Tax reduction is a major part of the committee's recommendations. We are suggesting that personal income tax reform be given a high priority. Reduced personal income taxes would mean that Canadians would keep more of their hard earned dollars to invest and to spend in the economy. We want to see the elimination of the 5% personal surtax. Along similar lines, the child tax credit should be extended.

There is also a need for reduction in the business tax system. Canadian businesses are competing globally and they must be allowed the leeway to do so. During the public consultations we were made clearly aware of how badly infrastructure revitalization is needed. Comments were made by people from all regions of Canada about how roads and highways are in dire need of work.

As a nation which relies heavily on roadway transportation, whether it is the automotive industry in Ontario or supplies being transported to Fort Nelson, B.C., we must invest in infrastructure. Therefore we have recommended a $2.5 billion federal infrastructure program. Not only would such a program mark an important contribution to the well-being and safety of all Canadians, it would create hundreds of new jobs and stimulate the local economy in many regions of the country.

On the issue of homelessness and affordable social housing, Canadians are demanding action. The Minister of Labour has undertaken a national survey to identify the challenges and the—

[Stéphane Bergeron, Bloc, Verchères, QC]

Mr. Speaker, I think that, if you count heads, you will notice that we do not have a quorum in the House. In order for our hon. colleague to deliver her speech in front of the audience she so rightly deserves, I would ask that you call in the members, so as to have a quorum.

[The Acting Speaker (Mr. McClelland)]

We do not have a quorum. Call in the members.

And the bells having rung:

[The Acting Speaker (Mr. McClelland)]

We have a quorum.

[Joe Jordan, Liberal, Leeds—Grenville, ON]

Mr. Speaker, I rise on a point of order. I would ask you to seek the unanimous consent of the House to approve the motion that the hon. member for Pickering—Ajax—Uxbridge put to the House earlier on Bill C-202.