Mr. Speaker, I will be splitting my time. I am pleased to speak today in the prebudget debate. As a member of the finance committee and an MP from western Canada, I have heard from many individuals and groups. It has become clear that Canadians want tax cuts and more health care funding. There are three main areas I would like to talk about, tax relief, health care and more funding for research and development.
A reduction in the tax rate will benefit Canadians. Our committee considered the level of reduction and how reduction should be distributed. We believe government priorities should be as follows. First, target tax relief to those most in need, including students, charitable organizations, children and Canadians with disabilities. Second, general tax relief starting with low and modest income Canadians. Third, increase general tax relief over time.
Based on recommendations from the finance committee last year the basic personal amount and the spousal amounts were increased for low income taxpayers. As well, the 3% general surtax was eliminated for many individuals. In combination those new measures reduced significantly the tax burden of the low and middle income taxpayer.
Now we can better afford additional tax reductions. Now that the tax measures aimed at the low and middle income Canadians have been introduced, the committee believes the government must begin to offer broad based tax relief.
It is only because the government acted responsibly in recent years and because Canadians from coast to coast have made substantial sacrifices that we should be in a position to implement tax reduction measures which will benefit all Canadians.
Our committee recommends that the next budget introduce personal income tax reductions for all Canadians. Further, we recommend that the government commit itself to future tax reductions by presenting a three year tax reduction plan.
We suggest that a temporary 3% surtax be completely eliminated in the next budget. The 5% surtax on high income earners should be eliminated gradually.
We believe the increase in the basic personal and spousal amounts in last year's budget should be extended to all Canadian taxpayers, not just those with low incomes.
The second area I would like to talk about is health care spending. We all agree more government resources should be devoted to health care. It should be the number one priority for government. Many individuals and groups expressed concern that the system may no longer be funded adequately. They argued that the federal and provincial governments should work together to ensure this.
The federal government should use some of the budgetary surplus to restore some of the cuts. We recommend a review of transfers to the provinces. Investing part of the surplus in improvements in medicare would demonstrate to Canadians the federal government's commitment to the medicare system and the principles of the Canada Health Act.
When cuts were made to the transfer payments many provinces simply made across the board spending cuts. We need strategies that ensure efficient and effective services are not eliminated. Increases should be justified by efficiency assessments of health care spending.
The committee is aware that as Canadian demographics change and the population ages, it is inevitable that health care costs will rise. We are concerned that the quality of health services could be undermined if funding is not increased. Increased investment could be used to improve service delivery, investment in new technology and to reduce waiting lists.
The third area I would like to address is that we need more funding for research and development. We recommend an increase in funding for new research initiatives. Innovative ideas are essential to maintaining a successful and competitive economy. Research and development can ensure the highest quality of health care for Canadians. We need research projects to demonstrate better ways to provide home and community services and a drug delivery program.
At the same time as the population ages, innovative technology becomes more and more sophisticated and expensive. We must find ways to ensure that Canadians have access to the best medical treatment possible. Medical innovation is a way to do that. On a per capita basis, direct federal funding for health research and development is five times as high in the United States as it is in Canada.
In France spending on medical research has also increased much more rapidly than in Canada. Therefore the committee recommends that more resources be allocated to research and development.
In conclusion, Canadians recognize that the federal government has a role to play in making Canada prosperous. It must also be responsible for both fiscal and social policies. As the report demonstrates, tax reductions and health care spending are priorities for Canadians.