Madam Speaker, I am pleased to rise in the House today to debate this very important issue.
Certainly the residents of Waterloo—Wellington and indeed Canadians no matter where they live have a great interest in this matter.
The equalization program is an underlying value of what it means to be Canadian. It is a cornerstone of the country, one which people recognize and rely on in terms of what it means to be Canadian. It is a sense of sharing, caring and ensuring fairness across Canada.
Over time and through history the equalization program has indeed played a major role in Canada and it can be argued has played a major role in defining our federation. I suspect and Canadians know our federation is stronger as a result, our federation is better off as a result and our people have benefited as a result. As a result of that, Canada has gained tremendously and I think that is important to know.
I also want all members to know that it is important that we act today to deal with this matter. We have had a deadline to meet and as a result are using time allocation to ensure that we meet that deadline of March 31.
I am not surprised the Reform Party and the Bloc do not support the equalization program. It is not surprising because both parties, quite frankly, do not want to see the federation work. Rather, both are committed to seeing that Canada does not work. That is really a shame but it is the reality of what we have here not only in the House of Commons but in Canada.
The equalization program ensures that all provinces have the resources they need to do what Canadians, wherever they live, want in terms of reasonable and comparable services. This is done so that hopefully they do not have to resort to higher levels of taxation than in other provinces. While this does not always happen it certainly is a goal and a laudable one at that.
I should also point out that the equalization program is an unconditional federal payment. This enables provinces to use the equalization program as they see fit and as they wish. That too is an important point.
Seven provinces receive the equalization program: Newfoundland, Prince Edward Island, Nova Scotia, New Brunswick, Quebec, Manitoba and Saskatchewan. They all qualify for this very important payment. That is something that bodes well for the country as a whole.
The proposed legislation, which is excellent I might point out, will renew the equalization program for a five year period, beginning April 1, 1999 to March 31, 2004. The basic structure of the equalization program will however remain as it, but the bill before us includes changes to ensure that it continues to measure the ability of provinces to raise revenues as accurately as possible.
These improvements will increase the cost of the program by an estimated $242 million. These changes too will be phased in over the five year period. As a result of extensive consultation, which I believe underscores the fact that our federation works, the bill will change the ceiling and the floor provisions to protect against greater fluctuation. This was done co-operatively and in a fashion and spirit in keeping with improving the federation for the benefit of all Canadians wherever they may live in this great country of ours.
The bill renews the provincial personal income tax revenue guarantee program for the same five year period I spoke about. This is a key and important provision. It protects those provinces participating in the tax collection agreements from any major revenue reductions that may be caused during the course of a year by changes in federal tax policy, as an example. This is worthy of our attention and clearly something in the best interest of the participating provinces.
Finally I want to outline that the budget tomorrow will provide new estimates of equalization. We all know that in the 1998 budget it was projected that equalization would amount to $8.5 billion in 1998-99. Official estimates showed an increase to $8.8 billion as released in October.
The federal government recognizes that the country we live in is continually changing. That is the reality of the Canadian community. It is also a fact that we must change if we are going to survive as a society. The federal government will continue to watch over the interests of all Canadians.
I want to simply say by way of conclusion that the legislation recognizes the importance of working co-operatively and in the best interest of all Canadians wherever they may live in Canada. It is legislation of great importance which underlies our commitment to making Canada work for all our citizens. It is worthy of support and I would certainly ask all members of the House to support it accordingly.