Madam Speaker, I am very pleased to have this opportunity to speak to Bill C-72, the income tax amendments act, 1998. I will be sharing my time with my colleague, the member for Kamloops, Thompson and Highland Valleys.
I begin by drawing attention to the fact that the bill we are debating today is as a result of the 1998 budget. Thinking of that budget, what it contained and the amendments now before us as a result of changes to the Income Tax Act, we remember this budget as something that came from the government side of the House being characterized as the education budget, the youth budget.
As the spokesperson for the NDP on post-secondary education I went through that budget and talked with students and student organizations. It was to take stock of whether this so-called education budget, and now the income tax amendments that flow from it, contained measures that would really assist students in Canada. Throughout 1998 as the impact of the budget began to unfold it became very clear that although this was characterized and held up by the Liberal government as the great education budget, the reality was that very little had changed in daily lives of students.
As someone who defends the interests of students, along with other members of the House who have concerns about students in Canada, I think there was one really despicable thing in that budget. While we were told it was an education budget, secretly, through the back door, there was something that was not announced in the finance minister's speech. It was changes to the Bankruptcy Act which impacted on students, changing the laws affecting bankruptcy so that students could no longer declare bankruptcy after having exhausted all other means. They could not declare bankruptcy after two years but had to wait ten years.
A couple of weeks ago I attended a press conference held by the Canadian Federation of Students where a test case was being brought forward to challenge the bankruptcy changes made by the Liberal government in 1998.
Ms. Annik Chenier is a young woman who attends Saint Paul University here in Ottawa. She had a student debt of $63,000. After some very modest interest relief and debt remission, Ms. Chenier was still left with a debt of over $50,000. She had left school and was now working and would be paying close to $700 a month on her student loans. Ms. Chenier had tried to obtain a reduction and a different type of payment plan but had reached the end of the line. Because she had no other options available to her she wanted to declare bankruptcy. She could not do so because of the changes in last year's budget. I bring this up because this really portrays what students are facing.
In this bill before us today there are some minor changes, a kind of tinkering, that provide some relief to students. I will go through them. The basic inequality and crisis being created as a result of the retreat of public funding, the massive increase in tuition fees, the increase in student debt, remains.
We have students like Ms. Chenier and other students across Canada still facing very desperate circumstances and still facing collection agencies that harass students. I have had phone calls from students crying because they have been harassed by collection agencies at work or school. Canada student loans have been privatized, turned over to banks which get a premium on student loans and if students go into default, through no fault of their own, they are turned over to collection agencies.
I think it is very important to point out that with some provisions in this bill, some debt reduction, Canada education savings grants, the 17% federal tax credit, while they do provide some minor relief, unfortunately the reality is they do not fundamentally or substantially change the situation for students.
One good measure was included, assistance for students with dependants. This, which was actually a Liberal red book promise, provides grants of $3,000 a year. That was a good measure and something I am glad to see the government acted on.
I was very disappointed, as I know students across the country and Canadians in general were, that the relief promised in the budget in terms of what was actually provided fell far short of people's expectations.
One of the changes in this bill involves personal income tax. If we look at the example of a one income family of four earning $20,000, under these provisions that family would get a tax cut of $165. It is certainly better than nothing but I have to compare that to a letter I received a few days ago from a woman in British Columbia.
She described her situation to me. She works in a fast food outlet, making minimum wage. She is raising two children and pays more than 50% of her income toward rent. She was writing to me about housing because I have raised the issues of housing and homelessness. With the measures we are debating today, would that woman and her kids be better off?
Would she have more money substantially to pay for her rent? Would she have more money to put food on the table? Would she have any money to put into savings for RRSPs for her kids' education which is one of the provisions in this bill today? She is struggling even to pay the rent, so any hope for her to put money into an education plan is something way down on the agenda.
I came to the conclusion, as my colleagues in the NDP have, that again this budget has failed in these amendments to the Income Tax Act before us today. It has failed in terms of dealing with the growing inequalities that face us in society. I hear some of the debate from the members of the Bloc who are pointing out the same kind of situation in terms of the constituents they represent as well and their perspective on this matter.
I think we have a really serious problem in this country. We have now had a succession of budgets. We had the education budget. We had the budget this year that was a so-called health budget. There is talk about the children's budget next year. None of these budgets or the income tax amendments that flow from them serve to substantially alter or change our tax system to make it fairer and progressive and to make sure that for low income Canadians, poor Canadians who have borne the brunt of massive cutbacks and of inequalities in our tax system, it will improve life in a meaningful way for those Canadians.
I think that is a real sad day for Canada. That is why my colleagues and I in the NDP voted against the budget last year. It failed to address those issues. Certainly in terms of the income tax amendments before today us when we look at the criteria of who this budget really helps, does it really help the people who are most in need, we come up with the same answer, that this budget and the legislation before us today have failed.
I guess we cannot escape the glaring facts that after tax inequalities are increasing and that low income Canadians and students are falling further and further behind.