Mr. Speaker, I am pleased to rise to speak to the 1999 budget and to address some of the concerns which the government has failed to address.
The principal issue that I want to address is that there has not been meaningful, broad based tax reduction, which the country desperately needs to grow our economy in order that we can be more competitive and, yes, more productive. As has been pointed out in the last number of days and weeks, Canada indeed has a productivity problem, which is largely due to the fact that our society is overtaxed.
It may come as a shock to Liberal members that personal income tax as a percentage of our gross domestic product is 18% higher in Canada than in the United States. Corporate taxes are 17% higher than they are in the United States. And we wonder why growth in our economy is stifled compared to what we see in the United States.
There is another price that this country pays for its high tax regime. More and more often our best and our brightest, the best young minds that we have in the country, are faced with a shocking fact. They are likely to finish an undergraduate degree owing $25,000 to $30,000. They are faced with decisions. Where do they seek opportunity? Where will they get paid more? Where will they get taxed less? Where can they have the best quality of life?
I am very proud to say that I still believe the best quality of life is found within the borders of this great country that we call Canada. However, we are going to lose more of our best and our brightest if we do not provide them with a tax regime which makes it competitive enough for them to stay here. I am saying, quite simply, that we need to lower taxes to end the brain drain.
I also want to point out what small business has pointed out time and time again. I would like to refer to a document from the Canadian Federation of Independent Business which indicates where small business feels their concerns were missed in terms of the excessive, extraordinary payroll taxes that we pay in this country. This government takes in over $6 billion more annually through the EI fund than the program actually consumes. That money belongs in the pockets of the Canadian taxpayers. It is plain and simple.
The CFIB also indicated where the concerns of the younger generation have been missed. As a younger person and a younger member of the House, I can say that the younger generation is very concerned about this. We have a $600 billion national debt which has been run up over the last 30 years. Now we are asking the younger generation to bear the burden of that debt. We owe it as parliamentarians on all sides of the House to make prudent investments to begin to pay down the national debt. It is our moral obligation.
There are other reasons for us to pay down the debt. As long as we have an enormous debt, as we do today, we will pay over $45 billion annually to service the debt. We will always be threatened with high taxes. We can never lower taxes unless we eliminate the causes of high taxes, and the principal cause is the national debt.
We need broad based tax reduction. Government members stand in question period, day in and day out, and say “We have lowered taxes”. I know people who are capable of lowering taxes. If there has been any growth in this country over the last decade it has been largely due to our export driven economy. Why is that? Where did that growth come from? It came from the free trade agreement of 1988, which was expanded by the NAFTA in 1993, which the Liberal Party opposed.
The government likes to take credit for balancing the budget. I would like to make it very clear that it was the Canadian taxpayers who made sacrifice upon sacrifice in the last number of years to get our fiscal house in order. It has been quite an ordeal. It has been a 15-year work in progress. I applaud Canadian taxpayers because they made the sacrifices to balance the budget.
Getting our fiscal house in order and once again having growth in the economy of this country is largely due to the Ontario government of Mike Harris. Since its election in 1995 it has lowered taxes and has made a commitment to balance its budget by the year 2001. If Mike Harris and Ernie Eves had not started the economic engine of this country again, that being the province of Ontario, nobody would have balanced the budget, not even this finance minister. That is very clear.
I would also like to point out where the real fiscal leadership in this country came from. From the political perspective, it clearly came from the provinces, first and foremost. I know it hurts, but it was the Progressive Conservative Government of the province of Alberta, led by Ralph Klein, which made a very firm commitment to pay down the debt because it believed it was wrong to burden the younger generation with it.
Gary Filmon, the Progressive Conservative Premier of Manitoba, also brought forward initiatives to balance the budget. He is the senior statesman of the provincial premiers in terms of the balanced budget legislation that he brought forth.
Again it comes down to the growth that has been created by the province of Ontario, which has been driven by the export sector and the lower tax regime.
I would also like to pay tribute to the government which was in power between 1984 and 1993 in terms of the tax reform which it initiated. If it was so wrong, why has the government not changed it? If free trade was so wrong, why has the government not changed it? Mr. Speaker, I know that you know the answer, being the very learned gentleman that you are. The reason the government has not changed it is simply because it works.
I believe it is imperative that we take some initiatives to invest in the future of the country.
It was a sin for the government to get its fiscal house in order by hacking transfer payments by more than 30%. Those transfers pay for our priority programs, such as health care, post-secondary education and social services. The government is not going to do anything. It is passing the burden of the problems to the provinces. I am very happy to say that the provinces met the challenge.
There are some investments to be made. I want to highlight one priority, the student debt level. It is a sin for an undergraduate to finish a degree today with a debt of $25,000 to $30,000. Why is that? Because the government slashed transfer payments by over 30%—