Debates of April 12th, 1999

Business Of The House

[The Acting Speaker (Ms. Thibeault)]

On Wednesday, April 7, 1999, I received written notice from the hon. member for Vaudreuil—Soulanges that he was unable to move his motion during Private Members' Business today.

As it was not possible to change positions on the list of priorities, I ask the clerk to drop this motion to the bottom of the list.

Private members' hour will thus be cancelled and the House will now proceed to the consideration of Government Orders.

The House resumed from March 17 consideration of the motion that Bill C-71, an act to implement certain provisions of the budget tabled in parliament on February 16, 1999, be read the second time and referred to a committee.

Budget Implementation Act, 1999

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Madam Speaker, it is with pleasure today that I rise to speak to Bill C-71, second reading of the Budget Implementation Act.

The recent budget failed to address many of the fundamental issues facing Canadians. The government says that the fundamentals are strong. Those fundamentals include an unemployment rate that is twice that of the U.S., personal disposal income that has dropped 7% in recent years during the same period that the U.S. has enjoyed an 11% growth in personal disposable income, and a productivity growth rate that the OECD warns Canada that if we do not improve our productivity growth rate there will be a substantial decline in our standard of living in the next 20 years. Personal debt rates are at an unprecedented high in Canada. The rate of personal bankruptcies is at an unprecedented high and there is a negative savings rate. These are the fundamentals of the Canadian economy.

When the government says the fundamentals are strong Canadians should be suspicious of the government's confidence in its policies. It reminds me of what John Kenneth Galbraith, the expatriate Canadian economist, once said. He said that one should be suspicious of governments that claim the fundamentals are strong.

I will speak specifically to some of the issues addressed in Bill C-71 relative to the CHST, the Canada health and social transfer. The government will increase funding, much of which will go to health care, by $11.5 billion over the next five years. This will mean that by the year 2005 we will have reached the same level of federal health care investment that we had in 1995. Although the government promotes that it is reinvesting in health care, the fact is that it will take until 2005 to reach the same level which health care investment by the federal government reached in 1995.

The federal government increased spending on health care and increased transfers to the provinces for that but has not provided a comprehensive and coherent long term strategy for health care despite the fact that health care costs in Canada will continue to grow by about $3 billion per year due to changing demographics. Again this is an indication of a government that by most accounts has a budget surplus but continues to have a bit of a leadership deficit.

Many Canadians were appalled when the government spent $3 million of Canadian taxpayers money promoting that it was reinvesting in health care. Many Canadians are wondering why they did not hear ads at the time when the government was taking up to $19 billion out of health care since 1993.

The fact is there were no such ads and the government is engaging in a propaganda machine to try to gloss over the fact that the same government which slashed health care and decimated the Canadian health care system, is now putting a band-aid on the health care system and has yet to deal with the systemic issues of the Canadian health care system.

The Budget Implementation Act addresses the issue of the reinvestment in social transfers. Money is being paid into a trust fund. Some $3.5 billion of this money is being paid into a trust fund. This is more part of the government's Mother Hubbard approach to fiscal policy. Instead of investing the money now into Canadian health care when Canadians need it, when the lines to receive health care have never been longer, the government is putting it into a trust fund from which the provinces will draw over the next three years.

The reason the government set up this trust fund was to skirt around the issues that the auditor general raised over the past several budgets relative to the government's taking money out of one year's budget to spend in the future.

While this may address in some circuitous way the auditor general's concerns, the auditor general is not the only Canadian who is concerned about the government's bookkeeping practices. Not only does the government's fiscal policies offend good bookkeeping practices. It also offends good economics. Canadians need economic stimulus now. Canadians need a better health care system now. This is when we need the money to be invested, not in two years or three years.

Last year the government had a vague whiff of a surplus. What did it do? It took $2.5 billion from that surplus and spent it on a millennium scholarship fund. It put the money into a pot that will not be drawn from for about three years. Not one Canadian in the year following that budget benefited from that $2.5 billion. Not one Canadian will benefit for another three years, until those funds start to go out into the Canadian public. Even at that point about 5% of students seeking higher education will be receiving any benefit from that.

While the government claims to be trying to behave fiscally responsibly, in fact due to its short term partisan goals and in particular the leadership goals of the current Minister of Finance, the government is actually betraying its trust to the Canadian people by taking money from Canadians today when they need it and not spending it until the future, not providing the type of wide broad based tax relief that Canadians need, for instance the type of investment Canadians need in health care.

The fact is the government continues to tinker with the Canadian economy. This was referred to over the weekend at the Canadian Tax Foundation conference, a non-partisan gathering of tax experts from across the country. At that conference Robin MacKnight, director of the Canadian Tax Foundation, said that in his view there had been too much tinkering of late and that the tinkering had introduced far too much complexity into the tax code.

Of course the government tinkers with everything. The government does not have any broad based long term strategy relative to any issue, whether we look at its policies or non-policies on the environment or at the government's strategies on the economy.

This is not the type of government that would have the courage and vision to introduce a free trade agreement. This is not the type of government that would recognize the importance of eliminating a manufacturers' sales tax that punished Canadian exporters, replacing it with a consumption tax. This is a government that ducks the hard issues. It continues to tinker around the margins of the real issues, as opposed to dealing with the important problems facing the Canadian economy or any of the wide range of issues.

Bill C-71 also addresses issues of human resource management. It suspends the use of binding arbitration for another two years, to the year 2001.

Recently we had an all night debate on the back to work legislation for PSAC. During that debate I was as disillusioned as most Canadians when I saw the government withhold information from members of the House until after the vote on closure. Government members as well as opposition members, including members of the Reform Party, were successfully manipulated by the government to support closure when a tentative agreement had been reached with PSAC. It did not tell members of the House about the agreement because it wanted to force back to work legislation, to rub the noses of PSAC employees and its members a little farther into the ground.

This is not good human resource management. At a time when the Government of Canada has the responsibility to play a leadership role in human resource management we are finding that the government again is not managing the issue appropriately. The morale in our public service has never been lower than it is now under this government and that is because of the government's continued disrespect for the public service and its continued efforts to emasculate the public service.

Binding arbitration has a role to play in labour management. It is time for the government to return to using binding arbitration prior to using back to work legislation. Binding arbitration is meant to be an ameliorative step to deal with problems before using the incredibly powerful tool of back to work legislation.

The government continues to try to circumvent legitimate labour management practices. It will not use binding arbitration. In fact it will be another two years before it even addresses binding arbitration.

This bill does not address effectively the issue of single income families that are punished by the government and face a discriminatory tax policy.

The Canadian Tax Foundation had its annual meeting this weekend. Bob Brown, who is currently on contract with the Department of Finance, is a leading tax expert and a member of that foundation. He spoke to the conference and presented a paper. He said that Canada at this moment has a tax system which provides less recognition for the children of middle and upper income taxpayers than any of the G-7 countries.

We are not keeping up with our G-7 partners, not only in taxes, and Canadians face the highest income taxes of the G-7, but in terms of social policy. Canadian single income families are treated worse in this country than in any other G-7 country. That is clearly inappropriate.

Madam Speaker, I am splitting my time with the hon. member for Markham.

[The Acting Speaker (Ms. Thibeault)]

I am afraid that the hon. member's time has expired. I was not aware that he was splitting his time.

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Madam Speaker, I ask for the consent of the House to split my time with the hon. member for Markham, and I apologize for not having asked at the outset.

[The Acting Speaker (Ms. Thibeault)]

Does the hon. member have the consent of the House to split his time?

[Some hon. members]

Agreed.

[Julian Reed, Liberal, Halton, ON]

Madam Speaker, I would ask my friend if he really believes that it is irresponsible to only spend what one has. Does he honestly believe that it is irresponsible government to use money which is available and spend it over time? Does he feel it is irresponsible to put in place, for instance, a millennium scholarship fund when it can be afforded by the country and bring Canada into the 21st century, hopefully with the most highly educated Canadian citizens we have ever had? Does he feel that putting money that is available now into a trust to be spent in future years is irresponsible?

A few years back the member's predecessors speculated on whether there would be a surplus or a shortfall in the year to come. When there was a shortfall of perhaps $10 billion, which was the average shortfall, some excuse would be given to explain why targets had not been met. We were told that it was external influences over which we had no control.

This government is simply doing its accounting in a different way. It is not spending what it does not have. I ask him, in all sincerity, if he considers that to be irresponsible.

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Madam Speaker, I think there is some confusion on that side of the House.

The money in the fiscal surplus belongs to Canadians, who have borne the brunt of deficit reduction. It was an effort that began as early as 1984. In fact the Leader of Her Majesty's Loyal Opposition has said in the House that it was the structural changes made in the Canadian economy which allowed the current government to pay down its deficit. Those structural changes included free trade, the GST and the deregulation of financial services and transportation which began under the previous government.

The money belongs to Canadians. Canadians need that money to be invested immediately or it should be given back to them through tax reduction. Canadians need tax relief now, not in the future, not 10 years down the road. They need it now and they need significant tax relief now. While Canadians are pleased that the government is in the black, they have never been in the red to a greater extent than they are right now.

The government took $2.5 billion out of last year's budget to spend down the road. If a small business person were to practise that kind of accounting Revenue Canada would be breathing down their neck. Action would be taken against them. They would have to hire an accountant to defend them against the government.

It is not good bookkeeping and it is certainly not good economics. The money that is taken out of this year's surplus should benefit Canadians who need a break now and tax relief now, and who need better investment in health care now.

[Jim Jones, Progressive Conservative, Markham, ON]

Madam Speaker, as industry critic for the Progressive Conservative Party of Canada I am pleased to speak today to Bill C-71, the budget implementation act, a Liberal budget that completely fails to address the root causes of Canada's low productivity.

In a speech delivered in Toronto on February 18 the Minister of Industry cited Canada's need for more business investment, the importance of more foreign investment to develop new technology and the significance of higher innovation. The minister also said that Canada's productivity growth over the past 25 years was the worst in the G-7. I was pleased that last month the Leader of the Reform Party and the member for Medicine Hat followed my lead in question period in highlighting the industry minister's lack of confidence in the Canadian economy.

The Minister of Industry is not alone in his assessment of Canada's weak productivity. At a conference last month, just a few minute's walk from Parliament Hill at the Chateau Laurier, Nesbitt Burns economist Sherry Cooper called Canada's productivity the worst in the industrial world.

The Liberal Party's own pollster, Michael Marzolini, added that Canada has the worst rate of productivity among our G-7 competitors.

The Liberals have attempted to portray anybody who questions Canada's weak productivity as an enemy of Canada who does not want Canada to succeed.

Although I can understand some of the rhetoric, I challenge the Liberals. Is Sherry Cooper an enemy of Canada? Does the Liberal Party pollster not want Canada to succeed? Was the Minister of Industry wrong when he spoke to the Empire Club in February in Toronto about Canada's weak productivity, low foreign investment, high tax burden and declining standard of living?

The PC party believes that the priority to improve Canada's productivity should be on tax relief and less red tape. Let me be clear. I do not criticize the government for increased funding for organizations such as the National Research Council or the Canadian Space Agency.

The fundamental problem with the government is that it ignores the best approach to increase the business investment needed to improve productivity: low business taxes, a lower regulatory burden and less debt.

There is an ancient Chinese proverb which says that it is not the heavily taxed realm that executes great deeds, it is the moderately taxed one. Canada needs to follow these wise words.

High taxes hurt our economy and threaten future economic growth. They discourage investment by businesses and individuals. This in turn limits employment opportunities and lowers tax revenues used to fund social programs.

Although our country is often cited by the United Nations and the Prime Minister as the best country in the world, we received a clear warning at January's world economic forum in Davos, Switzerland. Meeting participants, comprised of many of the world's business leaders, said that future economic prospects did not look bright and that heavily taxed and heavily indebted countries are particularly at risk.

Despite the rhetoric from the government, Canada qualifies as being both overtaxed and deeply indebted. In particular, we need to address the heavy tax burden of businesses.

Corporations are often the target of people frustrated with the economy. We will no doubt hear from some, especially the NDP, the Bloc, and to some extent the Liberals, that if only big, bad corporations paid their full share average working people would be better off. Of course this fair share concept implies that large corporations do not pay a heavy amount of taxes. It also suggests that Canada can raise taxes on corporations without any negative impact on the economy and our social programs.

In fact there are some who believe that our economy and social programs would actually improve if corporations paid more tax. Indeed it was the confused Minister of Industry who said last December that high taxes should increase productivity.

Let us take a look at the facts about business taxation. The first myth is that corporations are getting off scot-free. The reality is that since the Liberals took office in 1993 corporate income tax revenue has more than doubled.

Canada's combined federal-provincial general corporate income tax rate averages 43%, four percentage points higher than comparable rates in the United States, our number one competitor.

Moreover, Canada's corporate taxes are 9% higher than the average G-7 country, some of the most important economic countries in the world, including the U.S., Great Britain, France, Germany and Japan. Over the past 30 years the total tax contributions made by Canadian corporations, including payroll, sales, property and income taxes, has jumped 144%.

Many of those taxes are not even dependent on whether a corporation is profitable. The federal Department of Finance estimates that 70% of the taxes which businesses pay are not related to any profit whatsoever. Meanwhile, according to the Conference Board of Canada, for every single dollar in extra profit made by corporations in the past 30 years a full 62 cents was clawed back in taxes.

Corporations have not been untouched by the tax collector. In fact one could make a strong argument in favour of lowering the tax burden of businesses.

Our G-7 partners, on average, have lower corporate rates than Canada.

Meanwhile, other developing countries such as Ireland, Mexico, Hungary and Singapore are positioning themselves through low or non-existent corporate taxes as attractive locations for business investment, business investment which, according to the Minister of Industry, is needed for higher productivity.

Companies are mobile. They can choose where to invest their dollars, where to create jobs and where to pay taxes which in turn fund social programs. Companies can also decide where to conduct research and development and where to commercialize innovation. In short, companies are free to choose where to contribute to a productive economy. They are not choosing Canada.

Let us look at the result of Canada's high corporate tax policies. While we became the place to pick the pockets of business, foreign investment dried up. According to the United Nations' report on world investment, Canada's share of direct foreign investment fell by 50% from 1985 to 1995. More recent figures put the drop closer to 60% over a 15 year period. The United States, with a more favourable business tax climate, saw its share increase by 4%. That is very significant. The government knows that our corporate tax structure is a problem. There are other factors to consider beside the corporate income tax rate.

The federal Department of Industry commissioned an independent study in conjunction with the Alliance of Manufacturers and Exporters Canada to determine whether changes in the corporate tax structure would benefit the economy. The study was conducted by Dr. Jeffrey Bernstein of Carleton University in Ottawa and the National Bureau of Economic Research in Cambridge, Massachusetts.

Dr. Bernstein's analysis examined five different taxes and investment elements, including corporate income and payroll tax rates, capital cost allowance of plant and equipment, research and development, and investment tax credits.

Dr. Bernstein's report concluded that the existing corporate tax structure is an inefficient means of raising government revenue and that the reduction of corporate income taxes for manufacturers through the provision of an enhanced manufacturing and processing tax credit would provide the most significant benefits to the Canadian economy.

The report also inferred that a corporate tax increase of $100 million, relatively small in a $150 billion budget, would kill up to 627 jobs, the equivalent of six average manufacturing plants. Furthermore, a $100 million reduction in R and D credits would kill up to 3,000 jobs.

Each of these lost jobs have an impact. The person working at the job pays more taxes than they would if they were unemployed. The person is also not dependent on income security programs. It is a simple economic formula. More jobs equals less social and economic problems, equals a higher standard of living.

The viability and profitability of private enterprises are essential to the Canadian economy. We cannot have a strong economy that benefits socially as a whole without a strong private sector.

This budget does nothing to address one of the main causes of Canada's low productivity nor does it deal with the problem of government regulation. In particular, the government did not make a single change to the cost recovery program the Liberals introduced in 1994. There is nothing wrong with a cost recovery program that is based on reasonable fees, increased efficiency and smarter performance. Credible evidence suggests that the present program has no such grounding.

A recent report prepared by the Business Coalition of Cost Recovery, representing small, medium and large firms that employ 2.2 million Canadians and contribute $330 billion to the national economy, detailed the devastating impact of the federal cost recovery program since 1994.

Canada's manufacturers have been subject to a massive 153% increase in regulatory fees. User fees through cost recovery are among the fastest growing costs of doing business in Canada—

[The Acting Speaker (Ms. Thibeault)]

Order, please. I am afraid I must interrupt the hon. member. His time has run out.

[Diane Ablonczy, Reform, Calgary Nose Hill, AB]

Madam Speaker, it is a pleasure to speak today to Bill C-71.

Bill C-71 is an act to implement certain provisions of the budget tabled in parliament on February 16 and other measures announced in previous budgets.

This bill is about spending money. Budgets are all about spending money and where the money will come from. Today we need to make it clear where the money is coming from. Sometimes when I hear people talk, in particular politicians, it is as if the government has a stash of money that in its wisdom it doles out.

This money really comes from Canadians and from the work of Canadians. It comes from taxi drivers who spend 12 or more hours a day sitting in vehicles and driving around their cities. It comes from hairdressers and barbers who stand on their feet all day cutting hair. It comes from nurses and teachers. It comes from people in sales who pound the pavement or drive all over the country to promote the goods and services that Canadians produce. It comes from all kinds of workers. It even comes from our pages who still do pay some tax on their huge earnings from this House. I see them smiling so I am not sure how huge that is. We are talking about Canadians' money, money earned from long hours, dedication and a commitment to production by Canadians. We need to keep that in mind.

This bill, as most budgets are, in particular budgets running into the billions, is very complex. It is difficult for Canadians to unravel the ins and outs of how their money is going to be spent. It is our job in this House and in a democracy to give Canadians that information so they will be able to judge whether their government is doing a good job and whether their money is being wisely spent. They have a right to that information and it is our responsibility, because we get paid to do so, to provide them with that information. They can then make the judgment as to whether they want to continue with that kind of spending.

This bill is divided into nine parts each dealing with some different aspects of spending. As one might expect, members of my party, members of the opposition, members of the government and I agree with some elements of the budget and disagree with others. Unfortunately the process does not allow parliamentarians to be specific in their vote on what they support or on what they oppose. The vote is on implementation as a whole, all nine parts and their elements.

The vote on the budget is about the whole budget. Even though there are things we will want to support and things we will not want support, we do not get to pick and choose. In my view the government plays on this dishonestly by sometimes saying “Reform does not support the national child benefit”. What it is really saying is that Reform, by not voting for the budget, does not support the national child benefit which was in the budget. We are now unjustly accused by the government of failing to support some things because we had to vote against the budget as a whole. There were too many bad things in it. Parliamentarians now find themselves in a quandary.

The opportunity today to speak on the specifics of implementing the budget is very welcome. We are able to talk about things we support, the things we think the government did right and to hold the government to account for things we think it did wrong.

What does this budget say to the average taxpayer? Liberal governments are very expensive today, as they have been for the past 30 years. That is number one. The Liberals plan on spending $156.7 billion in this next fiscal year.

From March 31, 1999 to March 31, 2000 the government will spend $156.7 billion. That is $5,200 for each man, woman and child in Canada. It is about $21,000 on average from each family of four. For those out in the real world who are earning money today, $21,000 from the average family of four will be taken and spent by the government. That is a lot of work. It is a lot of hours sitting on that chair, Madam Speaker. We need to take this seriously and be good stewards of that hard-earned money.

This is not only a lot of money but we have to measure it against the fact that $21,000 from the average family of four may be coming from a wage of less than twice that amount. The average wage in 1998 was $37,400. The government spends over half of what an average single income family of four earns. I guess the government is so brilliant it can spend our money better than we can. We are going to examine that premise because clearly that is the premise the government operates on.

Are Canadians getting value from the Liberal government for their money? Are Canadians getting a fair return from this really punishing tax rate that is necessary to maintain the government's lifestyle?

When we look closer at the numbers we see that the government will spend $156.7 billion. However, over $42 billion or 27% of that amount will be spent to pay for the overspending of the past. In other words, 27% of what the government spends is deferred taxes. We are making up for the fact that governments did not manage their money wisely in the past. For every dollar of spending the government delivers only 73 cents in the form of programs. Even that is often wastefully managed. This is hardly value for money for today's taxpayer.

If this Liberal government and previous Liberal governments, and Mr. Clark and Mr. Mulroney at the time of the free spending Tories, had been more sensible about spending Canadians would have had that $42.5 billion today for programs or tax cuts rather than paying this enormous amount of interest on the debt. Each budget we see from the government is a continued testimony to its incompetence as trustees of the taxpayers' dollars throughout most of the last 30 years. The enormous sum of $42.5 billion is not available to us to spend on the things we think are important today. Most of us would struggle to put $42.5 billion into any kind of an understandable framework. I would like to help us do that.

Forty-two and a half billion dollars is about twice the amount of all income tax paid by all businesses in Canada in a year. The interest of $42.5 billion represents about twice the GST collected in Canada in a year. In other words, if we had that money, if we had not overspent and if we did not have to pay interest we could eliminate the GST, something government members said they would do. We could eliminate the GST completely and still have another $20 billion left over to spend on things that are important to us.

Here is another way to look at it. Let us go to the farthest eastern point in Canada, Cape Spear, Newfoundland and start laying $20 bills right across Canada to the farthest western point, the Yukon-Alaska border. By that time we would have walked 5,514 kilometres. Each $20 bill is 15.3 centimetres long or about about six inches. One kilometre equals 6,536 $20 bills so every kilometre we walk we lay over 6,000 $20 bills. Just over 36 million, 36,039,504 to be exact, $20 bills would be needed to cover the distance from Cape Spear to the Alaska border. The total value of those bills would be about $720 million.

Seven hundred and twenty million dollars will pay 1.7% of the annual interest on our debt. In other words, if we laid $20 bills right across Canada, from its furthest point east to its furthest point west, we would have laid down enough money to pay only 1.7% of our total interest that we cough up every year on our debt. We would need 59 times those bills in order to pay the entire interest. There would be stacks 59 bills high all the way across Canada. That is how much our interest is.

Now visualize this. We would have to have 59 $20 bills in each stack, but if the bills were around the equator, which is about 40,000 kilometres, $5.2 billion would be required, about one-eighth of the taxes required in this budget to finance our national debt for the next year, to put $20 bills around the equator. The stacks would be eight high around the middle of the world to pay the entire interest.

What if we were going to the moon? The moon is on average 382,000 kilometres from the earth. That would take a lot of years to drive, but if we laid $20 bills to the moon we would need 2.5 billion bills. That is about $50 billion, which is about 14 months worth of the interest we pay on the national debt to continue our trip all the way to the moon. That $50 billion is only about one-twelfth of our national debt.

I go through these things because it is important to remind ourselves of how our overspending and our fiscal mismanagement in the past hangs over us today. It limits our choices both collectively and individually.

I do not often take editorial writers and columnists as unimpeachable sources but I was particularly struck by a piece that Jeffrey Simpson wrote in the Globe and Mail on March 10. I would like to quote a couple of the observations he made. They were very penetrating analyses of our situation.

Jeffrey Simpson said “Debt is the past's dead hand lying on the future”. It is the future of our children and grandchildren and the future of the pages here. We have mortgaged their future with this debt. He went on to say “The future is all about flexibility, human skills, innovation, investment, adaptability, yet only a fraction of total government spending points in that direction. Far more is spent on yesterday's obligations than tomorrow's opportunities”.

That is a sad, sad message with this debt, with this interest and with this Liberal budget. Far more is spent on yesterday's obligations than on tomorrow's opportunities. That is something we cannot be proud of and which we must rectify.

I am going to make government members happy by talking for a period of time about what we like in this budget and what we support.

We like the fact that the Liberals have been forced to put back some of the billions they slashed from their support for health care. Their support for health care was already pretty meagre. When the Liberals brought health care in, they promised to support it 50% with the provinces. Today their support is just over 20%. That is what Liberal promises are worth. But they did have to put some of that money back, about half of it. For every dollar they slashed, over the next five years they will put about half of that back in, which is good. We support that.

As far as our party position is concerned, we have consistently been committed to protecting support for health care. We were calling for urgent and significant cuts in government spending in 1990. Even at that time when overspending was rampant, there were deficits and overspending by billions and billions of dollars every year, we still spoke out strongly on the need to protect spending in the two critical areas of education and health care.

In 1993 we put out a zero in three budget. We made some adjustments to government spending so that the books would be balanced, but none of those cuts came from health care or education.

In 1995 we did something unprecedented in the House. We put out an alternative budget to the government budget. The understanding was that the overspending every year was just about $40 billion, nearly as much as we are spending on interest today. In spite of that enormous overspending, we took virtually nothing from health care and education in order to balance the books.

With the books being closer to being balanced leading up to the next election, our campaign was to restore some of the billions the Liberals had slashed from health care and education. Our support for these programs has been consistent in our documents. This is unlike the Liberals. I grieve to say this because government members got up in this House and with their hands over their hearts and talked about fighting to the death, going to the barricades for health care and the Canada Health Act. What were the Liberals doing in the back rooms? They were slashing $7 billion from transfers for that program. That is what they were doing.

We are glad to see that the Liberals have finally come to their senses and due to pressure from Canadians are putting some of that money back. We will continue to support the return of funds that were taken away from health care and support health care being given a high priority.

The Reform Party has always advocated increased government recognition of the importance of the family unit. We have called for several tax relief measures to ensure that families keep a larger share of their earnings to meet the needs of their children. We recognize the contribution that parents make to society and the future of all of us through the birth and nurturing of children.

Canada's birth rate is dropping. Many of our programs are premised on workers, a strong workforce with secure jobs and secure incomes contributing to the kind of social programs, the safety net which many Canadians say, and certainly the government has said, defines Canada. It is one of the defining features of our country. But with our birth rate dropping and, contrary to popular belief, not being compensated for by immigration, we are in jeopardy. We all have a stake, if our pensions and other programs are to continue, in having a strong workforce of younger Canadians. We believe that we have a responsibility to assist children.

I have spoken often in support of the national child benefit system as a good example of the co-operation needed among federal, provincial and territorial governments to improve the quality of our social programs. It is a good program, but more can be done.

There is a lot we do not like in this budget. I have left it to my colleagues, many of whom have already spoken and many of whom will speak, to outline some of our very serious concerns. I have confined my remarks to the interest, the mortgage on our children's future, on the social safety net and on our programs.

In conclusion, I ask the government to lift the heavy hand of debt on our future and to move ahead to something better for our children and grandchildren.

[Deepak Obhrai, Reform, Calgary East, AB]

Madam Speaker, my colleague very eloquently put forward the views of my party in reference to the budget. I would like to ask her a question.

Recently, that brave lady, Beverly Smith, met with the Secretary of State for the Status of Women. Beverly Smith is a single parent who has been fighting the unfair taxation burden on single parents. She came out of that meeting very disappointed with the impression that the minister is giving lip service to the burden on single parents.

I would like to ask my colleague what she thinks about that meeting. How can we help Beverly Smith bring forward her concerns?

[Diane Ablonczy, Reform, Calgary Nose Hill, AB]

Madam Speaker, as you know, on this issue of single income families we have had a lively debate and a number of questions in this House. I thank my colleague for this question because we simply cannot let this issue die. It is far too important to our country's families.

There have been so many quotes over the years that families are the cradle of civilization, the birthplace of our leaders of tomorrow. Families are so important and so critical. Simply, the resources have to be in the families' hands to do their job and the work we have given them to do.

As my colleague from Calgary East has rightly pointed out, people in this country are fighting vigorously for tax fairness for single income families, whether they be one or two parent families trying to do a difficult job. In meeting with ministers and the minister my colleague referred to, they come away discouraged with the feeling there is not a recognition, there is not the vigorous support and affirmation for parents that there should be, that the parents' role is not honoured in the way it should be, that their resources are expendable even though the job they are doing is critical.

I can pledge to Canadians and to this House that the Reform Party, and I believe many members of this House, will not rest until there is tax fairness, until tax discrimination is removed, until the stealth taxes and the creeping deindexation of our basic exemptions are fought and conquered so that families and parents have the proper resources.

[Paul Crête, Bloc, Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC]

Madam Speaker, I will be sharing my time with the hon. member for Jonquière.

I am pleased to take the floor today to discuss Bill C-71, the Budget Implementation Act, 1999. This is a kind of omnibus bill in order to implement the budget. Among other things, it contains some items relating to tax arrangements between the federal government and the provinces, and to the Canadian Forces superannuation plan, some changes to the Financial Administration Act and an increase to the National Child Benefit, and it broadens GST credit eligibility for single individuals.

I would like to go into more detail on the reasons the Bloc Quebecois is opposed to this bill. There are three key elements of particular concern to us.

The first is that it contains the famous change to the method of calculating the Canada social transfer. The government is using this bill to legalize the fact that it has unilaterally decided to change the rules that determine the social transfer, going to a system that is solely demographics based, and setting a per capita amount for each of the provinces.

The consequences of this amendment alone will be to deprive Quebec of $350 million, or 8.3% of the $11.3 billion increase contained in this budget.

Such a decision is somewhat out of line with the very principle of the Canada social transfer, since the purpose of the CHST is to help decrease the inequalities between provinces, particularly where poverty is concerned.

This unilateral decision indicates once again the fact that the federal system is not always a good thing for the provinces. It will compel them to rethink their forecasting methods. A province may have decided to follow one course of action expecting a certain sum from the federal government. This change obliges Quebec and others to completely review the allocation of the money the federal government transfers to them. That sort of runs contrary to the objective of the program. Quebeckers will have to learn from this.

This fact is particularly true in a period of surplus. The federal government and the provincial governments are enjoying a surplus. Canadians share one major concern—how we will fight poverty.

It is not enough in our societies to have the highest gross national product. We must also assess our governments' efficiency at distributing this wealth.

We saw no original proposal in the budget for fighting the very negative effects of child poverty, among other things. The measure before us will not enable us to fight this situation either. Under it money will be allocated only according to the demographics of a given province and not according to its economic situation and social problems. This is the first reason the Bloc Quebecois will be voting against the bill, unless it is amended.

The second reason is the increase in the child tax benefit. We are delighted that the federal government has finally listened to reason and added funds to the amount initially provided, to total the $2 billion the Bloc Quebecois identified a few years back as the minimum required to ensure worthwhile results.

The sad part is that the money will be available, but over several years. The fight against poverty will not have the same effect as if there were a massive investment. Still, the measure is a step in the right direction.

I think the federal government could have made more of an effort, as far as spreading out its spending is concerned. It could have arranged to have the moneys available more quickly, particularly since we are in a period of budget surplus. Instead, the funding for the child tax benefit is spread over several years.

By contrast, the accumulation of surpluses in the employment insurance fund was not spread over several years. Year in year out for the past four or five years, the government has systematically taken very significant amounts from the EI surpluses. This is money that is not being used to fund the employment insurance fund, but any other type of federal spending, including payments on the debt. There is a lack of logic with this approach. On the one hand, the government is putting money back for the child tax benefit, while on the other hand it is generating poverty by having an inadequate employment insurance fund that does not allow the unemployed to have a decent income when they find themselves between jobs.

The federal government should have done more in that regard. It should have included, in the measures to implement the budget, something to correct the unfairness in the current employment insurance program. But there are no such measures in this legislation.

The non-indexing of tax tables is also a reflection of the inadequate effort made by the federal government to correct the flaws in our tax system. For example, between 1986 and 1996, Quebec residents have suffered a cumulative loss of income which was caused exclusively by the federal government's decision not to fully index tax tables based on the CPI increase.

This has resulted in a shortfall of $7,047 for people who would have made good use of that money and who actually needed it. This money would not have been used for luxury items, but for daily expenses such as buying groceries or paying rent, thus allowing these people to contribute to the national economy while also providing for their families' basic needs. In that regard, the federal government did not meet the objectives that we had in mind.

Of course, a bill such as this one to implement provisions of the budget cannot add to what was announced in the budget speech. Many oversights were identified. The federal government focussed on health issues, but strong anti-poverty action was needed as well.

When assessing our society's achievements, we must look not only at our capacity to produce consumer goods, but also at whether the resulting wealth is being distributed fairly throughout the community, providing people with enough money.

Last week, I attended a presentation made in my region by Vivian Labrie, who is advocating anti-poverty legislation and who made it very clear that most of what people receive they need for their survival, for vital expenses such as food and lodging. There are also functional expenditures, such as those for travel and moving, and some which could be described as luxuries for high income earners.

Nowadays, we should be more aware that each additional dollar freed up for those who earn just enough to get by has a much greater impact than an equivalent reduction in the taxes of someone with an annual income of $50,000, $60,000 or $70,000. It means much more to those receiving social assistance or EI, or earning minimum wage. An additional $1, $10 or $20 tax break for such a person has a far greater impact on their daily life, and this is something I think we should be aware of.

In conclusion, we feel that this bill to implement certain provisions of the budget is unacceptable because the change in the CHST formula hits Quebec hard. The bill also fails to provide for a sufficient increase in the child tax benefit—we would have liked to see a higher increase—and it does not address the problem created by the fact that the tax tables are not indexed.

For all these reasons, the Bloc Quebecois will be voting against the bill.

[Peter Adams, Liberal, Parliamentary Secretary to Leader of the Government in the House of Commons]

Madam Speaker, I listened carefully to what the member had to say. He mentioned the child tax benefit. I think his comment was that it was a step in the right direction.

I was a great supporter of the initiative by the government, the attempt at the federal level to reach down to children all over the country to try to alleviate child poverty, which is such a serious problem.

It is not a problem but it is a fact of life that the federal government has to deal with each province separately in these matters. In the case of the province of Ontario, the agreement we effectively had was that if the federal government were to allocate large funds to the children of poor families, the Ontario government made the rule that it would take away an equivalent amount of money from people on social assistance. It would apply the money it had saved to the children of poor families but the children of poor working families. It seems this is a serious mistake and a serious fault in logic. Surely we want to help all children in poverty. In some ways we particularly want to help those on social assistance.

My question for the member is from my own information. How does the province of Quebec handle this same matter? Did the province of Quebec have the same condition of taking money away from families on social assistance and applying those moneys to the families of the working poor, or did the province of Quebec proceed to allocate the child tax benefit to all poor children no matter what the source of income of their families?

[Paul Crête, Bloc, Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC]

Madam Speaker, I thank my colleague for his intervention.

I will remind him why the Bloc Quebecois finds the measure unsatisfactory. In 1997, we called for this fund to contain $2 billion, and with the present government measures, that $2 billion will be reached, but in the year 2000.

The impact needed to be far greater than that. According to the Canadian Council on Social Development:

—Canada's performance is extremely poor in comparison with the low income levels of nine countries for families with children. It barely manages to rank eighth for market income ... and seventh for total income after taxes and government transfers.

In other words, compared with nine similar countries, Canada ranks second highest in child poverty according to market income, and third for total income, after the United States and Australia. We have some catching up to do, and in our opinion we should have caught up faster.

The second part of my colleague's question addressed how the Government of Quebec had handled this.

Negotiations were held between the provinces and the federal government. The agreement was that the additional amounts put in by the federal government could be used by the provinces for other expenses. That led, among other things, to the $5 daycare policy, which gave 70% of parents with young children the opportunity to significantly reduce the money paid to daycare centres. I think that was a worthwhile measure.

However, in connection with the child tax benefit, I think people everywhere in Canada would agree child poverty should be attacked directly and more aggressively. It is in this sense that the Bloc Quebecois hoped that the money allocated would be available more quickly and that the fact there is a surplus this year would mean it would be allocated quickly.

July 1999 and not July 2000 could have been set as the time limit for the $2 billion. The people affected by these measures do not eat over the long term, but every day, and they need money quickly. As we can afford this measure as a society, we could act now.

[Jocelyne Girard-Bujold, Bloc, Jonquière, QC]

Madam Speaker, I am pleased to address Bill C-71, an act to implement certain provisions of the budget, and to say from the outset that I will vote against this legislation.

My speech will deal with four specific points, which I will develop.

This sixth Martin budget, the first so-called deficit free Liberal budget, is a crying shame.

First, it formalizes the misappropriation of funds by the federal government, at the expense of thousands of Canadian workers who cannot get employment insurance benefits.

Second, this budget does not reflect any will to help older workers who lose their jobs following plant closures.

Third, as regards the environment, where are the necessary moneys to fulfil the commitments made in Kyoto?

Fourth, this budget gives legal status to the federal government's will to encroach freely on provincial jurisdictions, by getting fully involved in areas of jurisdiction in which it has simply no business.

However, no matter how shocking and outrageous the Liberal government's attitude may be, it does not surprise anyone. About this time last year, when it tabled its previous budget, this government showed its true colours.

We then saw a Prime Minister of Canada who wanted to go down in history by creating a monument to his own glory. I am referring to the millennium scholarships.

Members opposite are getting all worked up. If the government really wants to help young people, why does it not transfer the moneys to the provinces, which are responsible for the loans and scholarships programs?

Quebec has the best loans and scholarships system. Our program adequately meets the needs of young people. Why not recognize excellence and give to the Quebec government additional funding to ensure a sound management of that initiative, instead of duplicating an efficient system?

That was a year ago. Now, the Minister of Finance, our master magician, our sleight of hand specialist, is getting into the act and unveiling his own monument. He did not want to be outdone. For weeks, he laid the groundwork. Day after day, he told us to wait for the budget.

Now we are considering the budget and what do we see? We see a Minister of Finance completely lacking in long term vision, a Minister of Finance whose concerns are all short term and motivated by political gain. What a bitter disappointment this is for all these workers and middle income earners.

In his new budget, the Minister of Finance is determined to conceal his surpluses rather than turn them over to unemployed workers and middle income earners.

Having contributed to the acknowledged $4.5 billion surplus in the EI fund, six out of ten Quebeckers and Canadians who lose their jobs will still not qualify for benefits. Many of my colleagues have spoken at length in the House about the unfortunate and very harmful impact of EI reform on women, pregnant women and young people. What the minister is doing is no small matter. Workers and employers contribute to this fund. The federal government has not put in one red cent in over ten years.

In this budget, where are the proactive measures, particularly those for older workers over the age of 50? Thousands of people in the various regions of the country will be affected by plant closures or massive layoffs. Where are the concrete measures in this budget to help them?

This government has abolished the program especially designed for them, POWA. Did these workers not contribute to the employment insurance fund for years? Many of them have never drawn benefits. This is an essential measure for them. The billions of surplus dollars that have accumulated must be used for this purpose, among other things.

Why has this minister not been listening to the thousands of workers by introducing such an active and positive measure in this budget? Perhaps the answer is obvious.

Where are the concrete messages to the middle-class taxpayer? Are these not the people who have made it possible for the Minister of Finance to do away with his deficit? Why has he not used part of his hidden surpluses to adjust the tax tables to the cost of living, thus putting $2 billion back into the economy?

To give an example from my riding, one of my constituents wrote me on January 22 to express his outrage at the unjust treatment of couples with a family income of $50,000 a year, when the wife does not work outside the home. Such a couple pays $4,000 more taxes yearly than a couple with both spouses working. He describes this as “unfair”, and is waiting for a response and a correction of the situation.

As my party's critic on the environment, I was greatly disappointed that the budget did not show any willingness, on the part of the government, to act in this area. Yet there is extreme urgency. This government is already behind on the formal commitments it made at Kyoto on eliminating greenhouse gases. And what about the elimination of 5,000 contaminated sites? Where is the money to get started on decontamination?

What about highway rehabilitation? Where is the funding for this? When is there going to be any follow-up on the $16 billion proposal made last spring by all provincial ministers of transport to the Government of Canada, with the agreement of their ministers of finance?

Once again, I see that this is just a lot of fancy talk by the Liberals, with no willingness to do anything.

A few days ago, on March 29, the Minister of Transport told us he was trying to convince his cabinet colleagues to give him $3.5 billion for this, whereas the provincial ministers of transport are talking about $16 billion. It is always tomorrow, tomorrow, later, later. We see no willingness to act in this budget.

Where is the money for this year? When are they going to bring back programs such as the strategic highway improvement program, which all the provincial ministers of transports are calling for?

Quebeckers, particularly the people of the Saguenay—Lac-Saint-Jean region, are not fooled by the fancy words repeated by petty politicians. The Conservatives did the same when they were in government between 1984 and 1992. They did nothing to improve roads, especially highway 175.

We in the Bloc Quebecois are here to tell them the real truth, to defend them against these petty politicians, because Ottawa is not so far removed and we are well informed.

Another matter dear to my heart is regional development. From every podium, we hear this government saying that its first priority is regional development. Is there a bit of “Do as I say not as I do” here? I think this can be said of the Liberals. If there is one thing I am sure of, it is that in this budget, in black and white, spending on regional development was cut by $100 million cut this year and $200 million next year. Find the discrepancies between the words and the figures.

Our national Minister of Finance also treated himself to a monument in this budget, the find of the century, the health care budget.

Canadians are not fooled. They know very well that the Liberal government is responsible for the deterioration in this country's health care system. They know the real story, not what the government would have them believe.

Since 1994, the government has slashed provincial transfer payments for health, education and social assistance by over $6.5 billion. The Liberal government is to blame for the terrible repercussions on the entire health system from coast to coast.

Underlying the Minister of Finance's new health budget is a dark history of billions of dollars in cuts that have hit the public very hard, and we must never forget it.

With the support of his colleague, the Minister of Health, the Minister of Finance is now charging into the health sector, a provincial jurisdiction, and imposing his views, new structures, statistics, monitoring, and additional paperwork. The final cost will be $1.4 billion over three years. This money will not benefit the sick; no, this government prefers to spend $400 million on administration alone just for the visibility.

What is the word for this? Irresponsible. But I say to the Minister of Finance that it is not too late. The minister should show some compassion and hand over these millions of dollars to the provinces with no strings attached so that the public can finally get the care to which it is entitled.

In conclusion, for all these reasons, and for all the other reasons my Bloc Quebecois colleagues have mentioned in their speeches, I will be voting against Bill C-71.

[Paul Crête, Bloc, Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC]

Mr. Speaker, I congratulate the hon. member for Jonquière for her good speech. I want to ask her a question concerning a very important point she raised, namely the issue of older workers.

The Minister of Human Resources Development keeps telling us that active measures are in place for these people. Could the member for Jonquière elaborate on the fact that, in the case of older workers—those aged 55 and over—active measures are often not enough, and passive measures are also necessary? The word “passive” may sound derogatory, but we are referring to support measures to help these workers make it to retirement. Would it not have been appropriate to include such initiatives in the budget?

Furthermore, is the hon. member pleased that the proposal made by the Bloc Quebecois, for which she is the critic, resulted in this issue being submitted to the human resources development committee, which will look at it over the next two months and which will hear witnesses? Would the hon. member like to send an invitation to those who made representations to us and who would like to take part in the committee's work regarding this issue?

[Jocelyne Girard-Bujold, Bloc, Jonquière, QC]

Mr. Speaker, let me first thank my Bloc Quebecois colleague.

The hon. member for Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques is a member of the Standing Committee on Human Resources Development. He succeeded in having the committee approve the proposal that we will review over the coming weeks regarding this very sensitive issue, and I thank him for that.

In the riding of Jonquière, between 200 and 300 workers will lose their jobs in the weeks to come. It is all fine and well to tell a worker between 50 and 55 years of age that he or she will get training, that he or she will be sent back to school, but these people need other things.

I thank the Bloc Quebecois for having given me responsibility for this issue. I am asking all those interested in testifying before the Standing Committee on Human Resources Development to contact us. We will be very pleased to hear all their suggestions.

It is not true that this issue is really a priority for the government. The government is not providing proactive measures for this group of citizens. We will not let it get away with this. We will, along with all Canadians and Quebeckers, propose concrete measures.

[Chris Axworthy, NDP, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, it is a pleasure to rise in the House for what might be one of my last times to talk about the budget.

The budget sets out a road map for the government. It gives an indication of its priorities and hopefully it gives an indication of the priorities of the population at large. The extent to which a budget is successful is the extent to which it represents the priorities of Canadians.

The government has made much of arguing the budget to be a health care budget, with which I will deal in a moment. If we look at that issue we see a government which has over the last five years cut over $21 billion out of health care and is about to put $2 billion back. This is not the kind of health care commitment that would qualify most budgets in the minds of most people as a health care budget.

The budget did many things and omitted many things. I will focus for a moment on the things it omitted and could have done in order to meet the priorities of Canadians. Canadians, as we know, face a number of crises at the present time. Canadians face a health care crisis which the budget addresses in a small way.

The population at large faces significant challenges with regard to job opportunities for both parents and younger people. The country also faces challenges with regard to the accessibility of students to education and a whole range of other questions including homelessness, our infrastructure problems and a tax system which remains extremely unfair.

The budget could have but did not address the priorities of Canadians with regard to their challenges in looking for work. The budget did nothing to increase the chances of any unemployed person finding work or of a person in a job feeling any greater security in terms of keeping that work.

The budget did nothing to improve the benefits for those most vulnerable in society, the unemployed, a group for which the federal government has responsibility in terms of its legislative jurisdictional powers over employment insurance and as a result of its control over fiscal and monetary tools which leads to certain levels of unemployment in the economy.

Over the last 10 or 11 years I have been in the House unemployment has been used as an economic tool for various other purposes dealing with interest rates, the value of the dollar and so on.

Nothing was done in the budget to combat the homelessness crisis with which we are all familiar. The Prime Minister has taken some steps since, but there is nothing in the budget or in the finance minister's set of priorities to ensure that those who are facing life's most severe problems, the unemployed and the homeless, have those matters addressed by the government. That is a priority which is askew.

There is nothing to address the unfair tax system. There is nothing to reduce the GST. As we all know, the government has given a tax break of $8,000 to millionaires and a handful of dollars to those at the lowest income levels. This hardly addresses the problem. It seems to make the problem worse.

There are other things too. There is nothing in the budget to tackle what are environmental concerns across the country, even the simple issue like a transit pass being available to employees in the same way as parking passes are. This modest and easy to administer environmental change did not find its way into the budget. As we probably all know, there is no adequate or proper funding for our cultural institutions.

Major Canadian priorities are not being addressed in the budget even though some tax changes were made. A person who makes $10,000 a year in income will receive from the budget tax savings of $51, a dollar a week. A person who receives $25,000 a year in income will receive a tax break of $115. A person who receives a $50,000 income will receive $160. A person who receives a $75,000 income will receive $595. A person who receives a $105,000 income will receive $813.

The more we make the better off we will be. That is not the priority of those who are fighting to survive in what is an ever increasingly challenging world. If one is making $1 million a year one will get a $8,000 tax break from the budget.

Let us remember all the fuss about whether or not hockey players should get tax breaks to stay in Canada. They did because those millionaire hockey players will get $8,000 extra a year to play in Canada while a family trying to get by on $10,000 will make $51 a year more, probably not enough to buy one ticket to go to a hockey game to watch that millionaire hockey player who gets an $8,000 tax break play in Canada.

Even where changes are made we see them made in the interest of those who are better off rather than in the interest of those who are less well off. We know our tax system is one of the most unfair in the developed world. Yet there is nothing here to make it more fair. Indeed we see a strategy of making it increasingly unfair.

Let me raise a few comments about health care spending. The government made much of the budget being a health care budget. Over the years of the Liberal government and over the years of the hon. member for LaSalle—Émard as the Minister of Finance, we have seen $21.5 billion taken out of the health care system. Only a couple of provinces have been able to fill that gap.

In my province of Saskatchewan each year the NDP government has consistently put more money into health care than what the Liberals took out, at a great burden to a province with a small tax base and significant financial problems left over from nine years of provincial Conservative government mismanagement. The Saskatchewan NDP government saw health care as a priority, as did the residents of that province and Canadians as a whole, and thereby committed more money than was cut by the Liberal government in Ottawa.

What is the response of the Liberal government? As a result of the budget it will put back $2 billion, one dollar for every ten that was taken out of health care. We know the angst across the country over the state of our health care system. That angst is exacerbated when billions of dollars are cut from the health care system.

This is a modest prescription for the health care crisis caused by the federal government over its years of belt tightening. This modest prescription will not satisfy the needs of Canadians or do anything very significant to improve our health care system.

I would add in terms of the priorities of the most recent budgets of the Liberal government that it is plain the brunt of deficit reduction was borne by the most vulnerable in society. That deficit reduction was called for and was necessary. The minister is to be credited for having steered Canada through this difficult time.

However, the way in which he did it meant that he attacked the most vulnerable in society. That is in sharp contrast with the way in which Saskatchewan balanced its budget, the first province to do so. There were increased commitments to the things that are most important to Canadians, not the Liberal model of increased cuts to the things that are most important to Canadians.

In that strategy, in that model of Saskatchewan NDP government's deficit reduction, we saw continued increases in funding for health care, education and social programs, not cuts. That is a distinct contrast with the way in which the deficits were addressed in the two jurisdictions.

We remain with some serious problems that could have been addressed by the government but were not. For example, as students have indicated the budget does nothing to solve student debt and the base funding crisis facing post-secondary education. Tuition fees will continue to rise while the quality of education continues to erode according to the students. Those of us who spend any time on university campuses can ensure that is the case. Without increasing accessibility, without increasing the numbers of Canadians who have access to post-secondary education, it is difficult to see how we can solve the economic difficulties we face.

On a personal note, as someone who is the only person from my extended family to attend university, and it was 30 years ago at least when I was at university, the question of accessibility is a critical one that we cannot leave in the state in which it is at present. It takes a lot of support for those who come from families who do not traditionally see university education or post-secondary education as a tool for their children to find a way to break through and to have access to post-secondary education.

It is an obligation of the country as a whole and of the government which represents the country to ensure that accessibility is there. It is the only way we will individually ensure that we can make the greatest contribution to our economy and to our society. Education is critical in this regard and yet nothing in the budget addresses this matter.

Children in poverty is surely the most serious problem we face. Not only Catholic bishops but practically everybody in the country has called this issue a national disgrace. There is nothing in the budget for Canada's poorest children, even though there is much rhetoric on this point in a number of committee reports and so on from the Liberal caucus.

There is nothing for homelessness, nothing for those who do not even have a place to live in what is one of the richest countries in the world. As the Minister of Finance indicated in the past, only the national government has the financial resources to address the full dimensions of this problem.

There is nothing for child care. We have the problem of parents, single parents in particular, wanting to access the job market, wanting to make a contribution and wanting to ensure their own independence, being denied that opportunity simply because child care is out of their grasp. Either there is not enough accessible quality child care available to them or the cost is simply prohibitive. Again this is holding people back rather than enabling them to move forward.

I mentioned the problems of our tax system and how unfair it is. Even a reduction in GST of 1% would have meant a lot to everyday people. The Minister of Finance could have taken a lesson from the Saskatchewan NDP government's book and in fact given everybody a break, particularly those on low income who spend all their money on the most basic items. There is no commitment to assisting those at the lowest end of the economic scale with a tax break.

Perhaps the most glaring omission is with regard to those who are unable to find work in Canada and are forced to rely on what is becoming an ever more meagre unemployment insurance system. There is nothing to address this concern. Indeed everyone has to be reminded that it is the employment insurance surplus which has made the deficit reduction record of the government as credible as it is. In other words the taking of money from those who are working and those who are unemployed in order to balance the country's books. This is not something many people would be proud of.

We face significant problems across the country both in highways and in other infrastructure elements. There is nothing in the budget for them.

While budgets set out a course of action and a set of priorities which should represent the priorities of Canadians, it is clear that the budget has not done that. More important, it has left the most vulnerable, the most in need, out of the picture almost entirely. That is to be regretted.

[John Herron, Progressive Conservative, Fundy Royal, NB]

Mr. Speaker, I take this opportunity to state to my hon. colleague, the member from the province of Saskatchewan, since he mentioned that this may be one of the last speeches he makes in the House, that I consider him to be a very thoughtful contributor to the House of Commons. We wish him the best in his future endeavours as he moves into another venue.

Although his approach in terms of social democracy may be different from my fiscal conservative approach, he did highlight some priorities in terms of what the economy has to do. The best way to actually grow an economy in which we can make interventions with respect to education and our health care system is to lower taxes and lower our debt level. Then we could have a more vibrant private sector that would increase revenues. We have seen this in the province of Ontario where the Harris government has been able to lower taxes and therefore increase government revenues.

My comment to the hon. member is simple. I concur with his initiatives in terms of making post-secondary education more accessible, but government intervention is not necessarily and always the easy way out.

[Chris Axworthy, NDP, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, I appreciate the member's earlier comments. Of course I regard him as a friend as well.

The point the member makes is an interesting one. If it were the case that tax cuts were the answer to problems faced by countries at the turn of the century, we would see countries with very high tax burdens being totally unsuccessful in the economic ventures we see ourselves facing. Countries with high taxes like Germany have very successful economies. There is no panacea to tax cuts as an instrument of ensuring economic success.

We would all favour lower taxes rather higher taxes, but in the context of ensuring that we provide the kinds of services Canadians demand, not just want, we need to ensure the level of taxation is adequate to meet those demands.

I would not necessarily put the member who spoke in this category, but the unfortunate aspect of those who argue for tax cuts is that it is a smoke screen for eliminating social services, social programs and government initiatives that those people find undesirable but the population at large finds quite desirable, continues to vote for and continues to see as important.

Health care is perhaps the greatest example of this. It seems that people will always take health care over tax cuts. There is no clamour across the country for the kind of tax cuts which the Reform Party and to some extent the Conservative Party argue for. People know they have to pay taxes for the services they need and they know there is a balance. The appropriate question is how to find that balance.

Plainly we do not have that balance with the present unfair tax system. I recognize that we cannot have a tax system that is far out of whack with our competitors' tax systems if we expect to be able to compete with them in terms of ensuring that our young people stay in this country to work, in terms of ensuring that employers invest in Canada and in terms of ensuring that we are competitive.

Canadians deserve tax cuts. I do not believe they should be the millionaires who received an $8,000 tax cut; they should be the people making $10,000 who only got a $51 tax cut. I would rather have given them something more meaningful than giving something to the millionaires. We need a more fair tax system which also reflects our international competitive situation.

[Dick Harris, Reform, Prince George—Bulkley Valley, BC]

Mr. Speaker, I want to talk about tax cuts. The member for Saskatoon—Rosetown—Biggar is a little off track when he talks about who should get tax cuts. It is middle income working Canadians who have continuously borne the brunt of the tax burden. They pay far higher personal income taxes than those in any of the G-7 countries. We pay the highest.

Although there is ample evidence, the member does not recognize that there is a direct correlation between a buoyant economy and a liveable tax regime. We do not have that in this country. The governments of Alberta and Ontario have taken some bold steps to lower the personal income tax levels of provincial workers. Those are the two leading economies in the entire country. Despite the tax cuts, their overall revenues have dramatically increased because their economies were given that stimulant.

In order to make this country attractive for investors, in order to restore consumer confidence and in order to give Canadian families a break in this country, in particular middle income families, this government has to recognize that it has an obligation. Considering that it has raised taxes to the tune of $39 billion or $40 billion since 1993, considering that the average Canadian worker's net income has decreased about $2,100, considering that the average family's disposable income in this country has decreased by $4,500 since this tax-mad Liberal government took over, I think the member would agree that this government is morally obligated to give Canadians a break in the income taxes they are paying. That is what will get the economy going again and that is what will provide money for social programs.

[Chris Axworthy, NDP, Saskatoon—Rosetown—Biggar, SK]

Madam Speaker, the member will know that the primary beneficiaries of the tax cuts he mentioned in Ontario and Alberta are the wealthy, not middle income Canadians. I share his view that it is the middle income Canadians who face the brunt of our tax system. In the 10 years I have been here we have seen middle income Canadians face an ever increasing tax burden. As a result of the important and necessary attack on the deficit they have seen themselves receive less and less in return. They are not getting good value for their money. They know that. That is the reason they are so disgruntled.

However, it is still the case across the country, no matter what the Reform Party says, that Canadians recognize the importance of the kinds of services that define the country—health care, education and social programs—and the need for those services to be paid for by tax revenues. That support, no matter what the Reform Party says, is there. It is there solidly and it will not go away.