Mr. Speaker, I am splitting my time. I am pleased to speak today on the prebudget allotted time. However, I have to question this exercise which has gone on for months now. The finance committee has travelled across the country hearing from every group of the political spectrum. I was on this committee for some of its travels and I sat through many of the hearings here on the Hill.
The all-party Standing Committee on Finance has now filed its prebudget report with the House. It is entitled “Budget 2000: New Era, New Plan”, and has 45 recommendations. My prediction is that the finance minister's budget will not resemble our committee's recommendations, just as it has been every year with the Liberals in government.
The feedback I received from across the country centred around tax relief. Not every group that presented testimony called for tax relief. Many Liberals and socialists were calling for further program spending. In fact, I am certain that some would like to see the entire surplus put toward spending initiatives. They would choke us all with big government. However, I would say that the majority spoke passionately about the need for tax relief. Whether it was relief on the capital gains tax, income tax or just taxes in general, the theme was the same.
Getting back to the committee, the members of parliament on both sides of the House spent much time listening to the grassroots tell them what was needed in the next federal budget. At the end of the day, members will ask themselves if it was worth it. We in the House know that the committee passed a controversial amendment on the unwise 50:50 plan of spending balanced with tax relief and debt reduction only to have this reversed the next when the word came down.
Committees in this place are run like a dictatorship. It is the government's way or it is no way. Canadians need to know that their voices mean little to this administration as evidenced over the years by what the government has brought forward in policy. Walter Robinson of the Taxpayers Federation makes the parallel of the prebudget to a Hollywood movie. The previews look really good, but when we show up and pay we are really disappointed.
Reform has, from its inception, been calling for tax relief. Reformers are not alone in this view. The Canadian Institute of Chartered Accountants said that tax reduction would significantly increase economic growth and employment. The Certified General Accountants Association agree. The International Monetary Fund is pushing for Canada to abandon its 50:50 plan and begin tackling the $570 billion debt more aggressively, in addition to giving extensive tax relief.
The Canadian Chamber of Commerce does not want to see tax reduction take a back seat to new program spending. The C.D. Howe Institute says that Canadians are underemployed, overtaxed and unproductive in comparison to many of our trading partners. The OECD says that Ottawa should give the highest priority to cutting personal taxes, accelerating its reductions in EI surpluses and work with provincial governments to lower business taxes.
These are respectable groups in the financial community. They are all saying the same thing, of what is a wise course to build a better country for everyone, especially for those of low or no income. How can the Minister of Finance, the Prime Minister and the caucus be so out of touch with reality?
Canadians know about the Liberal plan and they know that is much about image, about favouring the sectors that support them and about playing the role of benevolence to an electorate that is supposed to be appreciatively grateful for what it has done for them. In other words, the more surplus the more lolly the ministers can dole out to friends in their ridings. A case in point is the transitional jobs fund for which the Liberals' behaviour with just that one program should be evidence enough for them to be sent packing after the next election.
Reform has a great plan, a plan that will bring Canada back to standing firmly on sound economics and fiscal responsibility, capable of protecting Canadians from troubles in other countries. Much of it has been laid out in the committee minority report and I urge everyone to read it.
Many of my colleagues before me have spoken at length about our plan, and I will try again to highlight a few of the points.
First, we would scrap the unwise 50:50 promise. I think if we asked Liberal members today most would agree. Members across may scoff at this, but if this were not true, why did such an amendment pass the committee last week? This is an embarrassment for them because they know we are correct. They know that the Liberal members who voted in favour of scraping the 50:50 in committee are correct. The kind of underhanded scheming that went on in the finance committee to change it in the last minute was deplorable.
Second, Reform would reduce the capital gains tax. I will refer to the United States for a minute to show a chronology of what happened when it tinkered with the capital gains tax rate. Between 1970 and 1977, the capital gains tax in the United States increased. Revenues collected from this tax decreased. In 1978, the rate was cut sharply and revenues soared. In 1987, the rate was raised again and revenues stagnated. In 1997, the rate was in the 10% to 20% range and the result was that revenues from the adjustment increased by 40%. The numbers do not lie. Why is the minister and the government ignoring what is so plain and simple to everyone else?
Third, Reform would eliminate bracket creep. I will read what the OECD said about bracket creep. It stated:
The burden on Canadian taxpayers has increased over the last several years largely as a result of a non-indexed tax system. The lack of full indexation has pushed around 20 per cent of tax filers into higher tax brackets over the past ten years, resulting in increasing average tax rates at all income levels (although proportionately more for low- and middle-income individuals).
Let us say that the average worker receives a cost of living raise, that person could possibly be moved into a higher tax bracket, pay higher taxes and in fact probably never notice the raise. That person may even see their income decrease.
In the past 12 years, bracket creep has pulled more than a million low income Canadians into the income tax net. Most of these are the working poor who, under the Reform plan, would pay no tax.
I find it interesting that the Liberals, who have always pretended to take the side of the disadvantaged, would not be doing everything in their power to eliminate bracket creep. Reformers, on the other hand, are advocating fairness for Canadians. Why will the Liberals not follow suit? They are raising revenue via the back door. It is underhanded and it is simply wrong.
Fourth, Reform would hold the line on spending. This is something dear to the hearts of the Liberals, the desire to spend. Next to the NDP, no other political party in the country spends like the Liberals. Spending allows cabinet ministers to dole out sweet deals to their supporters. We do not have to look any further than the transitional jobs fund, a program for creating jobs in federal ridings where the unemployment rate is supposed to be above 12%. According to the national accounts of Canada, government program spending has never been higher than it is today.
Let us take a look at the numbers. In 1997-98, the Liberals overspent by $2.95 billion or 2.79%. Budget 1997 planned spending was $105.8 billion; actual spending was $108.8 billion. It gets worse. In 1998-99, the Liberals overspent by $6.9 billion or 7%. Budget 1998 planned expenditures were $104.5 billion but actual spending was $111.4 billion.
In 1999-2000, all indications point again to overspending and a budget plan that already has in it fat, questionable categories.
Farmers in the prairies are suffering, yet the government says that it has no money. The RCMP is understaffed in British Columbia, yet the government put millions into a flawed gun registration program. The residential crisis of leaky condos in British Columbia cries out for help, yet the Liberals are nowhere.
Reform is not saying that government should not spend money. What we are calling for is control on spending and a more reasonable reallocation. Where is the expenditure management program that was once in place? This needs to be a permanent fixture whether or not there is a surplus.
I could go on and on about the fiscal mismanagement of the Liberals since they took office in 1993. They are truly not wise managers of the public trust. There needs to be a change in the leadership of this country. I am not referring to the current Prime Minister stepping down, for when I look at the team bench, the replacements would not help very much. Canadians are asking for a fundamental change in the direction of the country, not the Liberal version of the so-called balance.
Let us reform the budget so that some day the working poor will pay no income tax, so that some day seniors on fixed incomes will no longer fear the taxman coming, so that some day all taxpayers will pay the same percentage rate of taxation, so that some day the federal government will live within modest means and help rather than hurt, and so that some day we will have viable universal medicare for everyone.
Reform's fiscal responsibility message has been virtually the same since its inception. I can only imagine how strong Canada would be today had our policies been put into place. Canada's story is one of missed opportunity, but we are ready and we have the plan. We have the vision, the vision to lead, the competence to manage and the compassion to provide.