Debates of Feb. 18th, 1999

The Budget

[Richard Marceau, Bloc, Charlesbourg, QC]

Mr. Speaker, I would like the minister, who is fortunate enough to be part of cabinet, to clarify for us the winning strategy of those Liberal ministers from Quebec with high sounding portfolios like Intergovernmental Affairs, Human Resources Development, Citizenship and Immigration, and Treasury Board.

How is it that all they were able to get for Quebec is less than 10% of the money available for health? What did they do? Were they asleep during cabinet meetings? Did they stand up for Quebec's interests or did they just sit on their hands as usual, letting Quebeckers down in favour of the federal government and Ontario?

[Hedy Fry, Liberal, Vancouver Centre, BC]

Mr. Speaker, I suggest again that this budget is to be placed on top of the last three budgets because it is building a clear layer by layer infrastructure. It is also to be placed on top of the social accord which, the hon. member would agree, the premier of his province did not sign on to.

Therefore I should ask him why his premier did not consider the needs of Quebeckers in the context of the needs of all Canadians. By denying the ability to look at the social accord he is denying Quebeckers the right to work together in partnership with the federal government to build a stronger infrastructure, not only of health care but for social services.

Poverty is a very clear indicator of health. Productivity is one issue that we need to look at. Those are some of the built-in issues. A budget does not stand alone. The issues that we are talking about are not in isolation from everything else. Economic and social issues are interdependent on each other.

In order to build something for Quebeckers we would have to look at the whole, at how we deal with all the issues and whether Quebeckers get an opportunity to participate as the other nine provinces are.

[Roy Cullen, Liberal, Etobicoke North, ON]

Mr. Speaker, let me say right at the outset that the 1999 budget as tabled by our finance minister on Tuesday truly reflects the social and economic needs of all Canadians.

The budget highlights this government's commitment to continued co-operation with the provinces, on behalf of all Canadians, in order to safeguard and strengthen our society into the 21st century.

The budget was developed through an open and consultative process in which all members of the government were involved. The Ontario caucus, which I chair, fought hard to promote the interests of all Ontarians and all Canadians. I am pleased that our strong and united voice has been heard.

Canadians have told parliament that our health care system needs more funding to better serve those in need.

That is why, for instance, the 1999 budget announced that the provinces and territories will receive an extra $11.5 billion over five years for health care. This is the most substantial one-time investment ever made by the government.

The Ontario Liberal caucus fought hard for accountability measures to ensure that the new funding will be spent on health care and not for other purposes. Such assurances have been obtained from the Premier of Ontario and all territorial and provincial leaders.

The budget is good news for Ontario. It ensures that the federal government's health care investment will be distributed on an equitable per capita basis. Thanks to a policy of inequity introduced by the last federal Conservative government, Canadians have been treated differently under the CHST depending on where they live. Given the population of Ontario, we have not been receiving our fair share. The budget provides for a gradual narrowing of these disparities. Increases in CHST makes it possible for Canadians to obtain equal per capita entitlements by 2001-02. This will benefit provinces such as Ontario.

Transfers to Ontario will grow significantly over the next five years. New health money means transfers are projected to grow from about $9.5 billion this year to $12 billion over the next five years. Per capital CHST entitlements will grow from $830 million to $985 million by 2003-04. This means almost $5.3 billion more for Ontario over five years.

There are significant funds in these increased transfers to Ontario that could be deployed to assist the homeless in Ontario if this were the priority of the Ontario government. They have that flexibility.

Ontario will also benefit from $1.4 billion invested by our own government to promote health care research and prevention. In Ontario federal research dollars will support the work of two doctors from the Children's Hospital of Eastern Ontario whose research on genes will help patients suffering from Parkinson's disease, strokes and other related diseases. Researchers at Carleton University and Kingston General Hospital will also directly benefit from upgrades to MRI machines which will improve the detection of breast cancer. Mr. Speaker, I know that would be of great interest to yourself.

We are in a position to strengthen our health care system because of the prudent fiscal discipline undertaken by this government. After inheriting a federal Conservative deficit of $42 billion, we needed the help of all Canadians to put our finances in order. The sacrifices made by many will allow Canada to enjoy a prosperous future in the 21st century.

In 1998-99 we will balance the books or better. This is the first time since 1951-52 that the Government of Canada has been deficit free for two consecutive years. We are also on track for balanced budgets or better in both 2000 and 2001. This will mark only the third time since Confederation that the Government of Canada has recorded four consecutive balanced budgets.

Cuts in income tax are vital to the government's objective of building a better future today. Accordingly, the federal government is committed to making major tax reductions as equitably as possible.

For the first time since 1965, individuals are given a tax reduction without borrowing being required. The largest cuts planned in the 1998 and 1999 budgets will be for low and middle income Canadians, out of concern for fairness.

The 1999 budget builds on the $7 billion in tax cuts that were delivered last year by providing $7.7 billion in tax reductions over the next three years. The 1998 budget benefited low income Canadians by increasing the amount of income they can earn annually before paying income tax by $500. The 1999 budget increases the amount by $175 to $675 and extends it to all Canadian taxpayers. This means that effective July 1, 1999 the basic amount of income that all Canadians can earn annually on a tax free basis will rise to $7,131. In addition this budget also fully eliminates the 3% surtax.

This government is committed to substantially reducing taxes in the fairest possible way. Nonetheless for tax relief to be permanent, it must be affordable and not jeopardize the soundness of Canada's finances.

The 1999 budget also shows a strong commitment to keeping the debt to GDP ratio on a downward path. Last year Canada's debt to GDP ratio saw its largest single yearly decline since 1956-57, from 70.3% to 66.9%. For the current year, 1998-99, it will fall still further to around 65.3% and by 2000-01 the debt ratio should be down to just under 62%. This falling debt burden is allowing us to reallocate funds that would otherwise have been needed for interest payments on the debt. We increasingly will be able to free up resources for targeted social programs, tax relief and for investments in a more productive economy.

However, we need not be obsessed with paying down the debt. As our economy continues to grow, our debt ratio will shrink naturally as well.

The 1999 budget is based on a fact that applies the world over. Technology is changing at a phenomenal rate, before our very eyes. It is totally changing the nature of the labour and business markets and it is changing the skills and knowledge we require to remain competitive at home and abroad.

The new economy makes investing in knowledge and innovation essential for the creation of well-paying jobs and improving our standard of living. It is for this reason that the government has committed to spend more than $1.8 billion in knowledge spending. This money will help strengthen research and development and aid those companies producing leading edge products and services.

Last week I rose in the House to announce that the unemployment rate in Canada had fallen to 7.8%, the lowest in almost nine years. In 1998 Canada created 453,000 new jobs and led the G-7 with the highest job growth rate.

While these results are encouraging, we must continue to focus on reducing our unemployment rate even further. The best way to create jobs is by providing Canadians with the knowledge and training they need to adapt to our changing global economy.

On a final note, I would like to congratulate the Minister of Finance and the Secretary of State for International Financial Institutions for responding to an important initiative that I have promoted. This budget will amend the Income Tax Act to allow offshore investment funds to engage Canadian service providers without jeopardizing their tax status.

Essentially Canada has responded in kind to measures introduced in the United States to eliminate tax impediments for offshore investment companies that wish to conduct their back office work within the United States. Canada has done the same, allowing offshore investment companies to set up back offices in our financial centres to perform administrative work and investment services. This will help to create jobs and stimulate economic activity in the Toronto financial services sector and throughout Canada.

In conclusion, this budget is good for Ontario and good for Canada and it positions us very well to enter the next millennium. It is for this reason that I am proud and very pleased to support it.

[Peter Mancini, NDP, Sydney—Victoria, NS]

Mr. Speaker, I listened with interest to the comments of the hon. member opposite, especially when he said that this budget reflects and meets the economic and social needs of all Canadians.

The elimination of the 3% surtax amounts to some considerable savings. By my calculations every millionaire in this country will save $8,000. That figure resonates with me and this is why.

In my community this government has just committed to close down the coal mines. The amount of the training allowance that will be given to each miner who has spent on average 25 years underground, whose average age is 47, who owns a home of about $30,000 or $40,000, will be $8,000. That is the training allowance to move them into the new economy which the member boasts about. That is the money to bridge them from this labour intensive industry in which they have spent their lives to the new economy the member boasts about. If we had not given the millionaires the reduction that would save them $8,000, we might have been able to double the amount of training allowance for those miners.

The best illustration I can give the member is my next door neighbour. He will be 47 when the mines close and will have spent 25 years underground. He has a 17-year old boy who is at the top of his class entering university, a 13-year old boy in junior high and an 8-year old daughter with special needs. He will not get a pension. He will get a severance package of maybe $50,000, a portion of which will be taxed back and he will get $8,000 to train for the new economy in an area where the unemployment rate is 20%.

When the member says that the budget reflects and meets the social and economic needs of all Canadians, does he think it meets my neighbour's needs? Would it not have been better to keep in the government treasury the $8,000 from the millionaires and double the training allowance for those miners?

[Roy Cullen, Liberal, Etobicoke North, ON]

Mr. Speaker, I am pleased to respond to the comments from the member for Sydney—Victoria.

I know of the unfortunate circumstances with Devco in his riding. That has been a matter for concern for all Canadians and all parliamentarians. I thought I heard the Minister of Natural Resources announce in the House a fairly complete package to do the very best we can to help those people reposition their lives. There were a number of measures announced.

When the member talks about high income Canadians with respect to the 3% surtax, the vast majority of the balance of the 3% surtax being removed is really targeting middle income Canadians and lower income Canadians. There are some at the higher end who will also benefit, but I think we owe it to some middle income Canadians who have borne a very serious burden in balancing our books and bringing our deficit under control that they should receive some benefit from their hard work and their sacrifices. I have no compunction about delivering some target tax relief to middle income Canadians.

At the end of the day, reducing and eliminating the deficit is a means to an end. It means we have more flexibility now and in the future to direct government resources in more targeted ways that benefit more and more Canadians.

[Gilles Duceppe, Bloc, Laurier—Sainte-Marie, QC]

Mr. Speaker, this budget is a disappointment. It raises ire and promises the worst.

This budget is a disappointment because, once again, the unemployed are footing the bill. They will be paying for federal generosity, because the employment insurance fund will remain the government's cash cow, and the Minister of Human Resources Development will continue to be the valet to the Minister of Finance.

There is nothing for the unemployed in this budget. According to the forecasts, the government will be taking $4.9 billion from their pockets. In fact, by the end of the fiscal year, it will be more than $6 billion, probably $6.5 billion or $7 billion. That means that there will be in the unemployment insurance fund, what they call employment insurance—it is shameful to have such terminology for such purposes—somewhere around $25 billion taken from the pockets of the most disadvantaged.

There is no relaxation of this plan, which is pushing individuals and families into poverty, misery, despair—as I have seen in the Gaspé and in my riding. Children come home from school hungry because their parents are no longer entitled to employment insurance benefits.

Only 36% of those who have contributed and are unemployed are entitled to benefits. If an insurance agent charged two or three times the amount of the premium, compensated two victims out of five and pocketed the profits, as the Minister of Finance is doing, he would be taken to court and he would end up in jail. Yet, this is what the Minister of Finance, who is more interested in looking after his ships than after the unemployed, is doing.

We are also disappointed because the government made the deliberate choice of helping the rich rather than the middle class, by abolishing the 3% surtax instead of indexing the tax tables. Ever since the government stopped indexing the tax tables, the middle class has been paying ever increasing taxes. There have been no tax cuts. There are more and more middle class people whose salary has gone up, but their financial situation has not improved, since the price of consumer goods has also gone up. These people are paying more taxes because the government did not index the tax tables. This means that the tax burden of the middle class remains excessively heavy.

To be sure, the Minister of Finance will tell us about the child tax benefit. But let us not forget that this benefit only applies to low income families. After all, could it be that, if children are poor, it is because their parents are poor? Could it be that many children are poor because the Minister of Human Resources Development, another bad choice of words, is devoid of compassion and cold-hearted? He is a technocrat.

This minister is making sure that some men and women no longer qualify for EI benefits and therefore have no money to look after their children. And then he sheds tears and laments the plight of children who live in poverty. Do members know what this sort of behaviour is called? It is called hypocrisy, and this is what we get from the Minister of Human Resources Development and the Minister of Finance.

This budget is outrageous, because it clearly shows that the federal government does not care about the provinces and that social union will, to all intents and purposes, lead directly to a unitary state. In fact, we are seeing the first fallout from the social union because nowhere in the document, with its constant references to the social union, is it stated that Quebec did not sign the agreement.

The government refers to it repeatedly, but fails to mention that Quebec never signed such an agreement, and a good thing when we see what is happening to the other provinces, always of course with the complicity of the Premier of Saskatchewan, Roy Romanow.

They will never get us to believe that this agreement runs for only three years and that federal interference in provincial areas of jurisdiction will therefore be limited to three years as well. We know this is not true.

We know that these are institutions that will become permanent and that will sanction the presence of the federal government in the health sector. In fact, what the federal government is trying to do is to slip the social union past Quebec.

Ottawa's strategy is to put $1.4 billion into health, although this is an exclusively provincial jurisdiction, through various initiatives. One of the programs announced was the national health surveillance network. Ottawa knows best. Big brother is at work.

Now, the federal government is going to link up public health laboratories. Why? So as to be better able to impose its own priorities. Yet there is no serious problem with the interprovincial exchange of information on serious illnesses and epidemics. We do not need the federal government creating another bureaucracy, particularly in health because, as I said the other day, in biology, the function creates the organ, but in Ottawa it is the reverse. As soon as they have any money at all, they create another bureaucracy.

There are already all sorts of mechanisms at the interprovincial and federal-provincial levels for these purposes. What is the reason for these initiatives by Ottawa at a time when emergency rooms are overflowing and waiting lists for surgery are growing? What does Ottawa do? It carries out new studies and collects more statistics.

But the provinces know where the problems lie. They do not need a federal big brother to do studies for three or four years and then tell them emergency rooms are overcrowded. They know that already. So should Ottawa, because it was the one that cut health funding by $6 billion in Quebec alone over the last four years. And now it expects us to thank it for giving $1 billion back. It is a bit like expecting someone who has had $6,000 stolen to thank the thief for giving back $1,000, leaving him only $5,000 short. And the spineless Liberal Party members from Quebec give it their seal of approval.

What is even more disgraceful in all this is that the real needs are being felt throughout the health system, but a new bureaucracy of statisticians is being created. We do not need statisticians; we need doctors, nurses, specialized health care providers and support staff. Ottawa gives us numbers, paper and bureaucrats. Some priority.

There is another program called the NURSE fund, whereby the federal government is trying to do indirectly what the Constitution prevents it from doing directly, namely interfere in health care management through the role it assumes with regard to our nursing staff, something a minister was bragging about a few moments ago.

I will read an excerpt from a budget document dealing with this issue. It says, and I quote:

—better enable nurses to deliver quality care—

—in an environment of health care restructuring; identify approaches to retrain—

—the existing workforce; and attract new members to the profession.

In one sentence, we see interference in three different areas, namely health, education and manpower training. If we want to attract new members to the nursing profession, we do not need statisticians, sociologists or rocket scientists from the federal government. Give us back the money and we will know what to do with it. We will give nurses higher salaries and hire more of them. We need money, not far-fetched ideas from the finance minister and his accomplices.

In the computer age where communications are transforming our society, the federal government will use new technologies to further interfere in areas under provincial jurisdiction. I am thinking of the telehomecare, telehealth program. Ottawa can now have a physical presence in CLSCs and is in the process of creating virtual CLSCs. This is unacceptable, especially the unfair treatment Quebec is getting in the distribution of additional health transfers.

First of all, I must point out the hypocritical methods used by the federal government in announcing, without ever consulting Quebec, how it will distribute the $11.5 billion that will be put back into the health care system. Quebec was not consulted, probably because this was part of the federal government's overall strategy regarding the social union issue. Alberta, Ontario and British Columbia were given kickbacks and asked to sign. That is what the arrangement was, as we now know.

The document on health, signed by the ten premiers, specifies that any amount paid back through the Canada health and social transfer was to be reinvested in health on the same terms and conditions as before. Once again, the Prime Minister broke the promise he made, when he signed, but he has done that on many occasions before. His whole career has been marked by such actions.

On the social union, consultations and a a one-year notice are provided for. The agreement was signed on February 4. The budget was brought down on February 16. The whole method of funding health care has been changed. That is how Ontario's support was bought, and we have seen that the stage was set for Mike Harris' comedy. That is how British Columbia and Alberta were bought as well.

We only need a few figures to illustrate this. In 1998-99, of the extra $2 billion in transfers for health, $150 million will go to Quebec and $949 million will go to Ontario. As for the $11.5 billion over five years, $950 million will go to Quebec and $5.5 billion to Ontario. That is billion, not million. Overall, Quebec will receive 8.3% of the transfers, while Ontario will receive 47%.

Whatever the period considered, Ontario receives six times more money than Quebec. That is what this good budget for Quebec is about, apparently. Of course, the spineless Liberal members we have here in Ottawa, these federalist yes-men, will contend that Quebec is getting an extra $1.4 billion in equalization payments, which is nothing but money owned to Quebec for the miscalculations the federal government has made three years in a row.

I heard the Minister of Immigration state, yesterday, that they are trying to repair a historic injustice. In fact, they are creating another one for Quebec. This is disappointing on the part of a former health and education minister in Quebec. This kind of attitude is disappointing, appalling and sad. We are expected to be pleased this consolation prize, because that is what equalization is, a consolation prize for other policies.

A few years ago, I heard the Minister of Intergovernmental Affairs say that, to bring Quebec nationalists and even federalist nationalists to take a more realistic view, Quebec would have to suffer. I think he has achieved his goal this time. His prescription has been filled by federal bureaucrat pharmacists, “Quebec is getting what the doctor ordered”. That is strong medicine. This is the sort of utter nonsense this minister utters; however, cabinet accepted it.

It is a short term solution. Ontario will receive ongoing transfer payments now and not just on the 50% provided for last year by the Minister of Finance in the social transfers, but on the whole thing, all 100%, not only for education or health, where there is a certain rationale for a per capita basis, but also for social welfare.

Should a province have 23% of the social welfare cases because it represents 23% of the population? That is the sort of nonsensical reasoning of the government and the Minister of Finance.

Let us take a look at what this per capita method would mean overall. If it applies to social transfers, will it apply to current federal spending on goods and services, where Quebec receives 20% instead of 24%? Will it apply to federal capital assets and spending, where Quebec receives 19% instead of 24%? Will it apply to federal subsidies to business, where Quebec received 18% rather than 24%. And to federal laboratories, where the figure is 16%? And to research and development, where it is 14%?

In the national capital region, of 43 research centres, 42 on the Ottawa side and one in Hull. Is that chance? We do not think so. It is not a matter of chance, this is traditional Ottawa politics. That is 13% of federal personnel in science and technology, and I am not including the army.

Let us have a look at regional development. In the maritimes, the per capita amount from the federal government is $1,074; in Quebec it is $325. In this case, the per capita basis is not a good thing. They forget the per capita basis when it is worth their while, and the Liberals from Quebec, marching merrily along, have not a word to say about it. They will agree to anything. This sort of attitude is shameful.

This government and this Minister of Finance in particular, with his henchman, his shylock in human resources, are shameless. Political schemes are now what guide the Minister of Finance in determining how the accounting should be done.

The Minister of Finance tells us he is going to stay the course, creating trusts like the millennium scholarships, in the name of good public health and transparency. When we ask questions here in the House about the millennium scholarships, we are told that we must ask the foundation. What is transparent about that? When we notice surpluses, later on, they will tell us there is a foundation, that they cannot answer our questions.

They call that transparency. I have another word for it, like the term fair play they use so often. Unfortunately, fair play seems to be the best we can come up with in French as an equivalent for the English, but 90% of the time these people use the expression fair play to mean what we call hypocrisy in French. That is the only word for it.

We know that surpluses will magically materialize next spring. The Minister of Finance will say that the government has done much better than he expected it would, and that he had no idea three weeks earlier that there would be a $15 billion surplus.

The Minister of Finance may be a lot of things, but he is not unintelligent. He is not lacking in the brain department. He knows how to count, we know that. He is a good counter, but we do not have the right accounting book. This is because, every year, the minister indulges in a game of cooking the books. It reminds me of the recipes of a chef named Pol Martin. I can mention that name, because there is indeed a chef named Pol Martin.

The minister underestimates revenues, overestimates spending, dips into the employment insurance fund of his accomplice, all this with a good dose of political cynicism seasoned à la Pol Martin, the chef, not the Minister of Finance, of course.

He tells us he is being cautious, but his figures no longer mean anything. One cannot be off the mark by $15 billion or $12 billion year after year. People know that what is being announced now is not what will be announced in March and in October, when the last quarter will end. Last year, the Bloc Quebecois said the surplus would be at least $2.5 billion. We were told “No, no, no, this is wrong”. Well, in October, it turned out to be $3.5 billion. This is the reality. The minister uses the same trick every year.

So, surpluses will appear once again and what will the government do? It will set up new trusts. Last year, the government got involved in education, while this year it is in the health sector. What will it be involved in next year? Perhaps in municipal affairs, road infrastructures or whatever.

Things are becoming more and more clear with this government. We can see why the Prime Minister was anxious to hold a last minute meeting, on February 4, after refusing to do so just before the budget. It was to bribe the provinces that would sign the agreement and keep quiet afterwards. This government is rebuilding Canada for Canadians, for the nine other provinces that are working together.

I have nothing against their wanting to build a Canada in their own image. I have known for a long time that Quebec has no place in there. We are in each other's way because we are two different peoples with two different ways of doing things. And there are nine allies on the other side who sign documents, only to go back on their word afterwards. The Prime Minister did it yesterday by not adhering to the social union agreement with regard to transfer payments.

The Prime Minister told us that the Constitution's general store was closed. I can tell you that the Prime Minister's boutique is open for business and that federal officials are getting in through the back door and getting ready to change everything in this country, trying to impose upon Quebec their own vision of Canada. They are telling us: “You will comply. You will be pleased to get equalization payments. You will be pleased that there is no productive policy for Quebec. You will be pleased with things such as the energy line in the past, even though you are not getting your share of the research and development envelope. But you have equalization payments. You have more employment insurance, more unemployment insurance”.

Could it be because unemployment is on the rise and federal policies have something to do with it? All the yes-men, all the happy beggars, Liberal members from Quebec, applaud their leader.

Quebec's motto is “I remember”. I can tell you that this budget will not be well received in Quebec, that we will remember it. If they think they can impose their own vision of Canada, the Bloc will be here to defend Quebec's true interests.

We will not give in, as those on the other side constantly do, thinking that 74 Liberals out of 75 signed the Constitution in 1982. We called them “the 74 nitwits”. I think we are not through seeing nitwits among federal Liberals from Quebec.

[Roy Cullen, Liberal, Etobicoke North, ON]

Mr. Speaker, the Bloc Quebecois is complaining about the budget, but this is nothing new, this is par for the course.

The Bloc members complain about everything and anything. I am glad to hear the opposition leader say that they will be around for a long time, not that I welcome them here in the House, but that means Quebeckers will not accept their vision of Canada.

One thing I found very interesting is the Bloc Quebecois and the Parti Quebecois talk about the per capita equalization. I find that strangely ironic because I guess some deal was cooked up with the previous Conservative government, the Quebec government and other governments. It is fine to have nice little cosy deals, but when they are not fair, that is when we speak up. What we have here is a per capita equalization on the CHST that is fair.

What the hon. member forgets to mention is the equalization.

Thanks to the new equalization formula calculated over a five-year period, the have-not provinces will get $5 billion more in the next five years than they did in the last five.

Sadly, Quebec is one of those less prosperous provinces. Why is it less prosperous? Because of the policies and politics of the Bloc Quebecois and the Parti Quebecois.

If we look at the equalization payments, Quebec received in 1997-98 $4.2 billion, and in 1998-99 $4 billion. That is about half of all equalization. In fact it will allow the province of Quebec to balance its budget.

The member conveniently forgets the equalization. He conveniently forgets the fairness of the per capita CHST.

[Gilles Duceppe, Bloc, Laurier—Sainte-Marie, QC]

Mr. Speaker, I did not forget it, in fact I alluded to it in my speech. The member would know this if he had listened.

When I said that this so-called fair-play and fairness was in fact hypocrisy to us, this is living proof of what I meant.

If Quebec is getting more through equalization, and that may well be the case, it is because research centres are primarily located in Ontario, not in Quebec, it is because goods and services are bought primarily in Ontario, not in Quebec. The government would like us to believe that we are charity cases. We do not want charity, we want productive investments.

This is the kind of speech heard even before Confederation. When we got together back in 1840, Ontario was in debt, but not Quebec. They said “Let us be fair and have everyone contribute”. This is their idea of fairness. Today, they are again talking about fairness. They are saying “You have equalization, we are giving you money, you should be pleased with our generosity”. In the meantime, they make money.

For example, think of the money invested in Ontario with the Borden line, to the detriment of Quebec, and with the auto pact, again to the detriment of Quebec. This is productive money, unlike the money for welfare and unemployment, as they well know.

It is total hypocrisy to tell us that you love us, that you give us money. If you love us so much, are you prepared to pay for Quebec to stay? In any case, I do not believe you for one moment.

[John Finlay, Liberal, Oxford, ON]

Mr. Speaker, the leader of the Bloc Quebecois, the member for Laurier—Sainte-Marie, has made an impassioned speech. He uses a lot of fine language. He used the word “hypocritical”.

Twenty-three per cent of the funding is for 23% of the population. That is not hypocritical. My colleague has talked about fair play. I find it passing strange that the leader says that they have not found a good way to say it in French. I wonder if that is because the Bloc Quebecois, the real—and I say that facetiously—Quebeckers, do not really understand fair play?

[The Acting Speaker (Mr. McClelland)]

Hon. members, before we get into this, I think it is prudent to remark on the term “hypocritical”. My understanding is that in the form and the context used by the hon. member for Laurier—Sainte-Marie, he did not refer beyond generalities to an action. He did not refer to a specific person or individual but to a circumstance. It is important that that point be made.

[Gilles Duceppe, Bloc, Laurier—Sainte-Marie, QC]

Mr. Speaker, we have a clear enough understanding of what fair play is to know that when my colleague, the member for I am not sure which riding, talks about fair play, we know that what he is really talking about is hypocrisy.

We understand the concept well enough to know that it is not fair play he is talking about but hypocrisy, because if funding is on a per capita basis, that is fair, we get 23% of the social transfer, fine. Why not in research and development? Why not in procurement of goods and services? Why not in regional development? How can they talk about fair play when, if something is productive, it is not good for Quebec, but a great boost for Ontario? But, when health is on the table, fair play is dragged into it.

It is a double standard: it cannot be fair to one party and not the other. If there is agreement for per capita funding, then that is what it should be across the board. And the day we see that, we will not need Ottawa, among other things. We will keep our money for our own affairs. What we do not need is to send it here, have it processed by a few bureaucrats and then receive it back in another envelope.

They can work out whatever arrangement they want with the rest of Canada. That is their business and I want nothing to do with it. But our money belongs to us and we are not receiving it in productive sectors, because per capita funding has gone by the board. But when it comes time to redistribute the money for health and social assistance, the per capita formula applies. Especially for social assistance. Talk about inconsistencies! Will any member opposite rise in their place and defend their government's policy, without fear of being mistaken for someone who should not have been elected?

[Brenda Chamberlain, Liberal, Parliamentary Secretary to Minister of Labour]

Mr. Speaker, I will be splitting my time with the hon. member for Chatham—Kent Essex.

The 1999 federal budget is good news for the people of Guelph—Wellington. Last August I concluded a prebudget survey asking constituents what they would like to see in the budget. I sent a copy of the responses to my colleague the Minister of Finance. I am proud to say that he listened to the needs of our community.

When asked about their budget priorities, the most common answer in my riding was health care. This is a health care budget. An increase of $11.5 billion dollars over five years with an immediate transfer of $3.5 billion is great news for everyone. This infusion of funds brings the so-called health care component of the Canada health and social transfer back to the level it was before the period of restraint in the mid-1990s. It is very important to note that all of this money will go directly to health care.

A health accord was recently reached as part of the social union negotiations. There the federal government agreed to increase funding for health care. In turn, the provinces promised to dedicate all new health money to health spending. The federal government has upheld its end of the bargain. I am confident that the provinces will do the same.

The era of federal-provincial struggles is over. The social union agreement established an administrative framework for the management of Canada's crucial social programs. It established a process of dispute avoidance and resolution. It is proof that by working together the provincial, territorial and federal governments can build a better Canada. I believe that this atmosphere of co-operation will continue into the new millennium.

How will this health care money benefit the residents of Guelph—Wellington? It will be used to address the immediate problems of the medicare system, bed shortages, waiting lists and staffing difficulties. However, it will also be used to ensure the long term survival and fitness of the health care system that Canadians everywhere are so very proud of, a system that is the model for countries around the world.

One aspect of this funding increase that I find truly remarkable is that the provinces are given the flexibility to determine when they will receive the money that they need. This way every province will be able to meet the needs of its residents at its own pace.

In addition to money for front line services, $1.4 billion has been allocated to improve health information systems so that Canadians know how their health care dollars are being spent. It will also be used to promote health related research and innovation in areas like breast cancer treatment and the Canadian institutes of health research.

Finally, it will focus on prevention and ways to promote community health.

Something else that is big news for Guelph—Wellington is the equalization of transfer payments. It used to be that the have provinces, including Ontario, received a lower per capita amount under the CHST. Within three years these payments will be equalized so that every Canadian receives the same transfer payment because after all, Canadians want a society where everyone is treated equally.

In addition to health care funding, many residents of Guelph—Wellington wanted tax cuts. Once again the federal government has delivered.

Last year the federal government initiated a program of progressive tax cuts. This year we have built on that foundation by increasing the basic personal income tax credit from $6,456 to $7,131, an increase of $675. The 3% surtax has also been eliminated. Families with incomes of up to $45,000 will see their taxes reduced by at least 10%. When combined with the measures announced in the previous budget, this amounts to $16.5 billion in tax relief over three years.

These measures will also take an additional 200,000 low income Canadians off the tax rolls. Further, the federal government has allocated an additional $300 million for the child tax benefit. The threshold for benefits has been increased to allow almost $2 million for low and modest income families to receive benefits. This is an important tool in the fight against child poverty.

For the residents of Guelph—Wellington, tax relief means more money in people's pockets but not at the expense of our standard of living. It is because we have balanced the budget that we are able to do things like cut taxes and increase spending on social programs.

However, we do not believe that we should throw caution to the wind. We will not make decisions today that will run us into the red causing future generations to pay for past mistakes. No, we will continue to project two-year fiscal plans to have a contingency fund and to use that contingency fund to pay down the debt if it is not needed for other things.

This is only the second time since 1951 that a federal government has recorded two balanced or surplus budgets back to back. It is also only the third time since Confederation that we have had four consecutive years of budgets in the black. We will continue to improve on our nation's financial situation while improving the standard of living for all Canadians.

We cannot pursue either goal at the expense of the other, but rather, we must achieve balance.

The University of Guelph is one of the best post-secondary institutions in Canada and an important part of my community. It too will benefit from this budget and therefore so will the people of Guelph—Wellington.

The 1999 federal budget builds on the Canadian opportunities strategy announced last spring. Over the next three years the federal government has allocated $1.8 billion for the creation, sharing and commercialization of knowledge and innovation. This money will benefit the University of Guelph in a very real way.

The Canada Foundation for Innovation will distribute $200 million to improve research infrastructure. The Natural Sciences and Engineering Research Council will receive an additional $75 million to fund research and graduate studies. Biotechnology research will receive a $55 million boost over three years. Larry Milligan at the University of Guelph has been very involved in this field.

Once this knowledge is created the federal government will work to commercialize new technology, thereby helping to strengthen our economy and create jobs. Young people especially will benefit from this commitment to research and innovation because they will be on the cutting edge of technology and possess the skills needed to succeed in today's marketplace.

Our method is working. The 1998 budget announced the Canada education savings grant to help parents save for their children's education. I am happy to report this program has been twice as successful as projected. Between 1972 when registered education savings plans were introduced and 1997 there was a net accumulation of $2.5 billion in the plan. With the introduction of last year's CESG that amount increased to $4 billion, which is very impressive.

Another example of the success of our fiscal management program is continued job creation. Our national unemployment rate is 7.8%, the lowest it has been since 1990. In Guelph the rate is 5.8%. Last year youth employment saw its largest increase in 20 years. Canada leads the G-7 in job growth.

Over three-quarters of the new spending outlined in this budget reflects two of the highest priorities of the constituents of Guelph—Wellington and of all Canadians, health care and access to knowledge and innovation. However, it does not neglect other important areas such as funding for youth, justice, foreign aid and Canadian forces personnel.

I would like to commend my colleague, the Minister of Finance, on a budget that benefits the people of Guelph—Wellington and Canadians everywhere. This budget not only reflects the priorities of Canadians but the goals of the government. We will strengthen universal health care, provide tax relief for our citizens, fight child poverty and invest to increase our standard of living by promoting access to knowledge, research and innovation.

This budget reflects the balanced approach for which the Liberal government is known. It is one of the reasons Canadians have elected us to form two consecutive majority governments. While reducing our debt to GDP ratio is important, something we have done and will continue to do, our bottom line is people. We were elected by them to help improve their lives by steering the nation on the right course. Given the contents of this budget I would say we are definitely doing our job.

[Richard Marceau, Bloc, Charlesbourg, QC]

Mr. Speaker, this morning the media were reporting that the President of the Treasury Board and the Minister of Human Resources Development saw a benefit of federalism in the budget. Good grief, I never thought I would agree with ministers from the other side of the House.

What a fine example of Canadian federalism: 78% of freed up new money will go to the three richest provinces. Ontario will receive nearly 50% of the new money. The member for Guelph—Wellington must be very happy with that. Quebec will receive less than 10% of this new money.

In other terms, Ontario will be getting $950 million and Quebec, $150 million. Once again, Quebec is being had, and no federal Liberal minister or member is rising to defend the interests of Quebec.

So, I put my question to the member for Guelph—Wellington. What does she think of the Quebec Liberal doormats, who have not taken a stand in the defence of Quebec's interests?

[Brenda Chamberlain, Liberal, Guelph—Wellington, ON]

Mr. Speaker, this troubles and saddens me. I see Bloc members continually talking in this Chamber only for themselves, only for Quebec and never for the rest of Canada. They do not care about the rest of Canadians. It is shameful. It is an uncaring attitude that the Bloc Quebecois members have had ever since the first day they came to this Chamber. I have seen it on a consistent basis day after day in this Chamber. They truly should be ashamed of themselves.

The question was what about our federal members from Quebec. They continually stand in the House of Commons and talk about Quebec, but they talk about Quebec as a part of this great country. They talk about Quebec but they also talk about other Canadians. Why do they do this? Because they care, they have compassion and they have humanity. They do not only wish to serve themselves as the Bloc Quebecois is doing in this Chamber.

[Wendy Lill, NDP, Dartmouth, NS]

Mr. Speaker, I am interested in the comments of the member about this being a budget. The bottom line is that this is a budget for people and it is very good for the people of her riding.

Some of the people in my riding of Dartmouth will benefit from this budget, there is no question. We do have some millionaires in the riding of Dartmouth and they will get an $8,000 tax break. But there are a lot of people in my riding who will not benefit from the budget and I am very concerned about those people. I am concerned about the fact that we have high levels of disabilities in my community, and Nova Scotia has the highest level in the country. In this budget there is $5 million earmarked for the disabled and that is an incredibly pitiful amount, given the state of disabilities in the country today.

I am also very concerned of the fact that there is no money for social housing. There is no money to go back into the EI fund which has been in fact robbed in order to allow the Minister of Finance his so-called health budget.

I would like to know how the member believes that this budget is reflecting the needs of the one million poor children in this country who received nothing whatsoever from the budget, not at all affected by the child tax credit. How is the budget good for these children?

[Brenda Chamberlain, Liberal, Guelph—Wellington, ON]

Mr. Speaker, obviously they are getting a benefit from the budget because of the child tax credit. We have increased that amount to poor families. There is no doubt that children in bad straits come from low income families. We have made a provision for that in this budget.

We have addressed taxes in the budget. We have also addressed a major concern. When the member says in Dartmouth maybe we have done a little for them, my goodness surely the people in Dartmouth will benefit from the health care provisions. The people in Dartmouth will benefit from the provisions for youth, for justice and for the military. Surely the people from Dartmouth will benefit from all these things in the budget. I know they will.

[Jerry Pickard, Liberal, Kent—Essex, ON]

Mr. Speaker, over the last 10 years that I have been in the House I have never heard the opposition suggest there is a perfect budget or a perfect answer to any question the government puts forward.

We all realize its job is to criticize and try to find practices and policies which it feels the average Canadian would disagree with. One of the things I have heard over the last couple of days from my constituents is this is a pretty good budget. This is a plan that is moving our Canadian culture and society forward in many different ways. If we stop and think about it, it does hold a tremendous amount of positives for all Canadians.

I would like to examine three areas of the budget that are very important to all Canadians. The message that comes forth in my view is we have a rock solid economy which is the foundation by which business, social programs and all that we stand for as Canadians can advance. Clearly that rock solid foundation has been built by the cabinet of the Liberal Party, by the finance minister and by the members of the House. I want to make it very clear it was a combination of all members here as well as Canadian society in general who have told the House, the finance minister and the government what directions they would like to see in this budget.

The process has changed dramatically today compared with what it was 10 years ago. Thinking back 10 years when I first came to this House a budget leak occurred the night before the budget was to be released. Suddenly, from the Conservative government, all the budgets were sent out and everybody ran in circles and nobody knew what to do because it was a very secretive process, a process in which Canadians did not have a great deal of input and as a result I guess there was a tremendous amount of dissatisfaction at the end.

We have changed that process dramatically. Today we are very transparent. We are very open in consulting Canadians. As a matter of fact, the premier point that I can make with this budget is there was nothing new. Canadians knew what was coming down in the budget long before the budget day announcement. They did not know the fine details, but they certainly knew the direction in which this government was heading because of the consultation process.

In my view, that probably is the number one change that has occurred to make Canadians a part of the process and therefore Canadians are very happy with the result of the process as well.

Three areas I want to touch on are the rock solid economy and how that is helping the Canadian economy grow, investment in social and economic priorities, and the substantial, fair tax relief.

When we think about this rock solid economy that we are building today and in the future, all we have to do is look at the process over the last five years. We had a $42 billion deficit to tackle in 1993 when we were elected. Through very tough programs, through very difficult decisions Canadians worked along with the government to make sure we did not bankrupt this country and leave our children and our children's children in dire situations. The process was to eliminate the deficit and get our house in order. No one in the House can question that putting our house in order was a priority that had to be done.

We paid down the deficit and now we are in a position where we are starting to pay down the debt. The debt to GDP ratio has had the largest decline in 40 years in this past year, which went from approximately 70.3% to 66.9%. What it really means is that we are getting to a point where we can better afford the debt we have. With the growth the country is experiencing we will be in a much better position not only today but in future years.

We have done all we can to support business and make sure business has opportunity to grow in this country and expand beyond our borders.

For technology partnerships, for aid to business support in technology areas, this budget put $380 million. For the Canadian Foundation for Research in which we are moving research forward, helping universities, helping technological growth in the Canadian foundation as well as teaching hospitals which then feed off into our social net, $800 million was placed.

We all know the successes we have had in working with foreign markets, developing opportunities for business to expand beyond our borders, making Canada a world trader and making sure that we have stable businesses in the future.

At the same time, over this period of four or five years, interest rates have been on a constant decline. There is no question that interest rates have afforded business the opportunity for greater investment, to move forward and to grow. As a result our economy is rated number one in the G-7. That is not frivolous. That has happened because of serious careful planning which has made a huge difference.

I remember the former government during the 1993 election campaign stating that unemployment would remain in double digit figures until well beyond the year 2000. That was not quite accurate. That was a quote from a former prime minister. She said very clearly that unemployment would remain in double digit figures at least beyond the year 2000. Today, unemployment is at 7.8%. This drop in unemployment tells us something about the social values of the country because there is no greater move to ensure social stability than ensured jobs for Canadians.

We have not been able to answer every social problem in the country, but we did not start out under the best circumstances either. The distance we have gone, from the comments of my constituents, is tremendous. They are very thankful for the kinds of policies and issues we have moved forward.

Investing in the social economic side of things is another important issue. We know when we looked at the figures over the last several years that youth employment was terrible and we had to improve it. That is why over the last several years we have focused on a youth employment strategy. This year, next year and the year after we will be putting $465 million into youth employment strategies, which will give young people opportunities to develop job skills, to develop scenarios of work, and to develop the skills they need to become active participants in Canada.

It is also very important that tax relief has been included in the budget. That tax relief is for all Canadians. I look forward to the questions.

[Gerald Keddy, Progressive Conservative, South Shore, NS]

Mr. Speaker, I have listened to the hon. member for Chatham—Kent Essex and to the member for Guelph—Wellington and others. The member for Chatham—Kent Essex said there was no one on the opposition benches willing to give the government a passing grade.

I will give the government a passing grade on getting the budget into the black. Most members over here would give a passing grade for eliminating the deficit and putting the budget in the black.

It is like the report cards kids bring home from school on which it is indicated in very careful teacher's writing beside the marks that the student is capable of doing much better. The government is certainly capable of doing much better. It has barely received a passing grade. Now it is time to really go to work and do the business the country needs done.

The member for Guelph—Wellington talked of knowledge based industries. The government put a levy on CD-ROMs to help the music industry in Canada.

The knowledge based industries those members were talking about will be taxed 50 cents for every 15 minutes of time on a CD-ROM. Those knowledge based industries will not hire people. They will go to the States, Mexico, Ireland or someplace where they are welcome because they will not be able to afford to work here.

[Jerry Pickard, Liberal, Kent—Essex, ON]

Mr. Speaker, I find it difficult that my hon. colleague, the Conservative member across the way, is saying that the government is not perfect.

Who drove us to where we were when we took over in 1993? It was a roller coaster ride from way up there to a deficit of $42 billion down there. What on earth did they do for knowledge based industries then? Where did they lead the Canadian economy, aside from dividing the country and making people so extremely angry that they ended up with a caucus of two that could be put in a phone booth?

The public spoke. The public knows what they did. Today the public is not saying the same thing. The public has returned this government with two solid majorities. They should listen to the public.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I thank my colleague, who initially claimed the opposition was doing a very good job. However, I would like to tell him that we are here not just to criticize the government. I myself came here to resolve the constitutional crisis, this abyss toward which Canada keeps moving.

That said, when he talks of consultation and transparency, I think we have to take it with a grain of salt. Barely a few days before the budget was tabled, the premiers met to discuss health and the provincial transfers. There was never any question at that point of returning the money with criteria other than those used to determine where to cut.

I would like to know today whether my colleague thinks the Prime Minister had consultations and acted with transparency?

[Jerry Pickard, Liberal, Kent—Essex, ON]

Mr. Speaker, I am very pleased to talk to that point. We in Canada are successful because we have different values across the country. We have different economic situations across the country. We try as a federation to make sure that all sectors of the country are heard and have fair and equal opportunity to do well.

There are times when my province and I looked at some of the issues that came up in federal policy which showed the Ontario government had less money than some other poorer provinces, some other provinces that were not doing as well.

In general the wealthier help the other provinces. This has been the goal and the rule of the country. Quite frankly I think on a general scale Quebec has been treated equally to all provinces on all measures.

[Nelson Riis, NDP, Kamloops, BC]

Mr. Speaker, I am absolutely delighted to have a chance to participate in today's debate and to tell about a couple of things that happened to me in the last 24 hours.

Yesterday I encountered many of my Liberal friends in the hallways and around Parliament Hill and they all said the same thing: “Wasn't that a wonderful budget?” I said “Not the one I heard”. Maybe we were listening to different speakers on budget night. They thought it was a good budget; I thought it was a distasteful budget.

If Brian Mulroney had been sitting in the opposition gallery, he would have been cheering for almost the entire budget. He would not believe that things could get this right wing in the country.

I received an e-mail this morning—and I know others received it as well—announcing the guest speaker Saturday night at the unite the right convention in Ottawa. Guess who it is? The person that symbolizes real right wing fanaticism in the country, the single individual who has moved the right wing agenda of our country about 185 degrees to the right, the Minister of Finance. The Minister of Finance must be the guest speaker Saturday night at the unite the right conference because there is no better spokesperson for the right wing than the hon. Minister of Finance.

That went out this morning to all sorts of people who are curious about this weekend's events. Now we know at least who the Saturday night guest speaker will be.

[Bill Blaikie, NDP, Winnipeg—Transcona, MB]

No one is surprised.

[Nelson Riis, NDP, Kamloops, BC]

As my friend from Winnipeg says, we are not surprised. We are not.

I thought Brian Mulroney was kind of a wild and woolly right winger. Compared to the Minister of Finance he sounds like some kind of economic piker. He tried to move the agenda to the right but he failed.

I know my friends thought at the time this seemed a bit perplexing. As a matter of fact, back in 1990 the Minister of Finance he wrote a report on housing. He spent a number of weeks touring the country on housing and wrote a report on it.

As a matter of fact, to be fair, he used the term homelessness once in his budget. The term was actually there. There was one reference to the fact that we have homeless people in the country. We happen to have hundreds of thousands of homeless people. This has been identified by the mayors of every major city in Canada as a national tragedy. The finance minister did mention it. Here is what he had to say in 1990:

The federal role in housing must not be a residual one. The connection between housing and other aspects of both social and economic policy means that the federal government must take a lead role. Only the national government has the financial resources to address the full dimensions of the needs of this country.

[Peter Mancini, NDP, Sydney—Victoria, NS]

Was it this finance minister?