Mr. Speaker, before beginning, I would like to inform you that I will be sharing my time with the hon. member for St. John's West.
I rise today to voice my disappointment, and that of the people of Madawaska—Restigouche, in the most recent federal budget. The government's intention was to pull the wool over Canadians' eyes, but most of them have seen through it to what the government really had in mind.
The chronic unemployment problem in a number of this country's regions remains unchanged. The excessive tax burden remains unchanged. The battle against poverty remains unchanged. The issues around proper use of the employment insurance fund remain unchanged.
And if this is supposed to be a health budget, as the government expects us to believe, I would like to have it explained to me how restoring funding to its 1996 level can be a cause for celebration for the Liberals. Since 1993, the Liberals have cut only 9.4% in government program expenditures, while they have slashed 34.2% from transfer payments for health.
In other words, 57.5% of program cuts made by the Liberals have been made at the expense of the old and the sick. Hospitals are short-staffed and waiting lists for treatment continue to grow. The provinces cannot improve this situation unless there is a real reinjection of federal funds into the health system.
What did this government offer them, in its budget? The Liberals will reinject $11.5 billion into provincial transfers for health care and education over the next five years. Of this, $3.5 billion will be paid immediately in the Canada transfer for health and social programs as a one time additional payment, and the provinces can use it up within the next three years.
The votes accounted for in 1998-99 will be placed in trust until the CHST legislation is passed. It is a shell game. The other votes will be paid out in stages. The floor is raised to $15 billion and will stay there.
Despite all the Liberal fanfare, spending on health care will reach only 1996 levels. The financial commitment over five years contains no indexation mechanism taking inflation and demographic changes into account leading to an annual increase of some $3 billion for health care costs, totalling $80 billion annually.
An overall plan is needed to get the health care system working again. Unable to establish priorities and a long term plan, the Prime Minister and his Minister of Finance have managed to balance their budget on the backs of workers, the poor, the sick and the old.
They are now trying to care for the sick, left through their fault on a waiting list, by putting a band aid on them. Workers and Canadian businesses were hoping for more of a break in this federal budget. Unfortunately, all they got was the usual Liberal rhetoric. The government is going to take away $3 and give them back $1, for their own good.
It is as though the government thinks that it can fool Canadians and that Canadian workers and businesses do not understand that the money now being spent by the government is coming out of the EI fund.
In this regard, the Minister of Human Resources Development seems to be seeing the light. A few weeks ago, the Journal de Montréal reported what the minister thought about the EI fund. In a burst of frankness, he admitted that the $20 billion surplus in the fund was actually an illusion because it had already been spent. He expressed his doubts about how the fund had been used and recommended that there be a public debate on the issue.
Although they are only a beginning, I applaud the minister's reflections and hope he has the courage to defend them in cabinet, because the pillage cannot go on. The Liberals continue to think that they know better than Canadian taxpayers how to spend the money the latter have earned by the sweat of their brow. The government can increase the basic personal exemption by $500 and look for praise, but the reality is that it could have done much better.
Since the 1997 election campaign, my colleagues and I have maintained that the basic personal exemption could be increased to $10,000, instead of the meagre $7,131 proposed by the Minister of Finance and his government. This would have given all Canadians some long-awaited tax relief and would have meant that 2 million low income Canadians no longer had to pay income tax. These 2 million Canadians could have breathed a little easier and put more food on the table. If raised to $10,000, the basic personal exemption would have left a single person with $700 more, and a married person or single parent with $1,500 more. What a pity that this will not happen.
The federal government's hike in Canada pension plan contributions in 1997 will add $120 in taxes on the Canada pension plan in 1999. Net social security taxes have increased $60 in 1999. Because the improved basic personal exemption takes effect only on July 1, 1999, an individual with an income of $39,000 will have to pay $3 more in federal taxes in 1999. And the federal government calls this a tax decrease.
The government is refusing to lighten the tax burden that is crushing Canadian workers and making the Canadian economy less competitive. High taxes penalize initiative, are a hindrance to job creating investment and encourage highly skilled Canadians to move on to greener pastures.
Indeed Canadians have not been duped by this smoke and mirror budget. What has been handed down has fallen short on what was needed for low income Canadians, taxpayers and workers. Canadians can take heart, however, that some of their elected officials are listening to them and are willing to offer them the much needed relief they deserve.
Unfortunately they will have to wait another few years to tell the Liberals just what they think of their so-called good news budget. Meanwhile, we as Progressive Conservatives will continue to listen, to consult and to put forward positive solutions in terms of economic development, taxation relief and social programs.