Mr. Speaker, I will continue on this theme. Canadians rightly look to government to provide peace and order and to do the collective things in society that we as individuals cannot do for ourselves. It is also accepted that government itself must be a strong and fair referee in the economic game. The difference between richer and poorer nations arises from the kinds of government they have. Politics matters. Governments can bring health or harm, prosperity or despair. It is all in the policy choices they make.
That is why I speak out on behalf of my community against many of the unwise choices that have been made by this government since 1993. Most important, I speak for the positive things that Canada could achieve if we had a more accountable, competent government. I speak of the need for tax relief in this context, especially when the Prime Minister this week agreed with Brian Mulroney about the wisdom of high taxes.
Canada's story is one of not fulfilling our potential when we have every basic advantage. Because we have had abundant natural resources and access to capital to develop infrastructure, we have been able to participate in the various technological revolutions. We have had some measure of success since Confederation despite our poor governments and their many misguided policies.
Successive Liberal and Conservative governments through ignorance and/or perverseness and by being wrongly cheered on by the NDP have left Canada in a plight far below what we are capable of in terms of caring for our people and bringing prosperity and freedom to all rather than just maybe most.
Governments set the climate for the economy and the right mix of policies over time can be very beneficial. But governments can quickly cut down years of steady progress by favouring their friends, violating the basic laws of commerce and unreasonably promoting a party reputation over needed national policy. So it can be said that the Liberals have shown themselves time and again not to be wise managers of the public trust. They continue to mistakenly act as if they can tax and spend Canada into prosperity.
A better mix is needed between those who create and those who reallocate, between those who earn and those who burn the people's money. It could be said that at some point taxation even has a moral component of how right it is for a government to tax and control the financial affairs of Canadians. Although economic considerations can be complex, in our present situation it is all too obvious that Canada now needs significant tax relief.
The current arrangement needlessly hurts Canadians. It is obvious to any worker who knows what the government has done by seeing the deductions on his paycheque or the job that has been lost.
It is time that the average Canadian received a raise in pay this year, not by confiscating as much revenue from the economy and from paycheques. The Reform plan would give all workers in Canada a raise in take home pay this year.
The Liberals have hurt Canadians through unprecedented high tax levels instead of a better mix of spending control on government and a resolve to end economic discrimination. They also unreasonably cut health care instead of other things. We were then able to slowly stumble toward a fiscal surplus. Now we watch as the personal sacrifices that Canadian workers have made, who have spawned the surplus, evaporate under old style Liberal-nomics.
This year's Liberal surprise appears to be the changing in questionable size of the surplus. According to the Department of Finance's most recent pronouncement something unforeseen is occurring that has our $10 billion to $12 billion projected surplus shrinking to $7 billion or less. What they are really trying to tell Canadians in the lead-up to the budget is that most of the money that was promised for tax reliefs in the upcoming budget has vanished from the government books. Over the past two years at the time in the business cycle when government spending historically should be restrained, this government still succumbed to blowing by its spending budget a cost overrun which also the usual habit of the NDP in my province.
The facts are clear. Any further delays in large scale tax relief in the upcoming budget will only be because this government refuses to stop its wasteful spending. The government keeps telling us how great things are while the standard of living continues to fall. An unwise high tax policy is strangling the economy.
The deficit has been reduced by hiking taxes and slashing health care while the government's spending levels remain the same or in some cases rise. An eight cent drop in the value in our dollar is somehow deemed good for business. The auditor general refuses to sign off on the books of Canada for the third year in a row because he believes the government's accounting numbers do not meet required accounting practice. A $16.5 billion cumulative slashing of health and social transfers is called “saving and protecting health care”. The head of government says “it is not the right thing to do in a society like Canada to call for across the board tax cuts”. That was a recent published quote from the Prime Minister.
Under the Liberals Canadians pay personal income taxes 56% higher than the seven leading countries and economies. In 1996 under the Liberals the average Canadian family paid a total tax bill of $21,242 more than it paid for food, shelter and clothing combined. It pays even more now. Since the Liberals came to power in 1993 they have taxed back 155% of average wage increases. Under the Liberal government's watch this collective wealth of our nation has been devalued as our dollar sank to historic lows against the American currency. This result is the international judgment about the government's handling of our economy. Our $580 billion net public debt costs us some $40 billion a year to service and represents enough money to finance current health care payments for about 46 years. Yet this Liberal government still refuses to implement a serious schedule for debt repayment.
I am only allowed two or three minutes to summarize some of the proposals put forth by the official opposition in our 1999 prebudget submission to the Minister of Finance. I am saying that Canadians need tax relief this year. A wise mix of policies is needed that is more just and fair. Canadians need comprehensive tax reform beginning with a $26 billion in total tax relief phased in over three years. We need to continue the simplification of the tax system and reduce the overall burden of taxation on Canadians by eliminating the temporary deficit reduction surtaxes. The 3% and 5% surtaxes were introduced to balance the budget. Now that the budget is balanced they must be phased out.
We should reduce the burden of taxation on low income and elderly Canadians by immediately increasing the tax free threshold basic exemption to $7,900. Forcing low income Canadians to pay taxes and then transferring that money back in programs is really not wise. Leave more money in the hands of low income and elderly Canadians. Begin reducing high marginal tax rates and flattening the personal income tax system. Canadians pay a very high marginal tax rate at relatively low levels of income. We propose to fold the top two marginal rates into a single rate of 24% of income above $29,000.
The reduction makes incentives to earn and invest. We must end bracket creep. Also we must remove the marriage and child care penalties in the tax system.
Currently Canadian families that choose to provide child care in their own home are penalized by a tax system that does not recognize the value of parent provided child care.
We propose to reduce the marriage penalty by increasing the value of the marriage equivalent amount to $7,900. Further we propose the introduction of a refundable child care expense credit to replace the existing child care expense deduction. The credit would be available to all parents, not just those who choose to have their children cared for outside of their own home. It is about ending discrimination.
In the medium term we propose to undertake fundamental tax reform with an objective of moving toward a flatter tax system. However, these changes would require major consultation with Canadians and would be subject to new realities.
Nevertheless we need such long term visions to begin to see what could be done to make economic breakthroughs for the country. We need to introduce a comprehensive debt repayment schedule that would reduce debt by $19 billion over the next three years and by $240 billion over the next 20 years.
The Liberals continue to pursue an ad hoc policy of reducing the debt with whatever happens to be left over at the end of year. This policy does not promote international confidence in the government's commitment to debt reduction.
We propose to introduce legislation that sets a fixed percentage of each year's surplus toward debt reduction with periodic deposits made to a national debt retirement fund.
The government should demonstrate restraint in federal spending by instituting a three year spending freeze in most discretionary spending. It would promote value for dollar audits.
These are some of the measures that would provide predictability for private sector business planning and be a massive stimulus to the economy. There is so much more but I have limited my comments to tax reduction, the economic sense of it and also that it is a moral imperative.