My hon. friend across the way is piping up. I am sure he is a little embarrassed about that. It was his industry minister who did it. If he wants to take someone to task he should take his own industry minister to task. I am simply pointing this out. Obviously, whether or not those are accurate facts, there is a serious problem today. If they were not accurate, I just do not know why the industry minister would be telling Canadians that is the case.
Now that we have established that there is a problem and that high taxes are a big part of the problem, what do we do about it? What did the government do in Bill C-71? It talked about lowering taxes. What did it do in the budget overall? It talked about lowering taxes. The government talks about $16 billion in tax relief over three years. What it does not talk about is that while it is reducing taxes marginally on the one hand, it has already set in motion tax increases on the other hand.
The Canadian Federation of Independent Business appeared before the committee the other day, saying that what the government does not say is that because of bracket creep, which is the inflation tax the previous government basically set in motion, every year we see the impact of those tax cuts the government was bragging about eroded to the point where after three years there is no tax relief at all according to the Canadian Federation of Independent Business.
What the government also did not say was that a couple of years ago when it set in motion the huge increases to Canada pension plan premiums it did not calculate them as tax increases. It said it was a rise in premiums. However, Canadians have to pay those premiums. They do not have a choice. That is a payroll tax. By the way, they are not getting any more pension for those huge increases in payroll taxes. In fact, they are getting a slightly smaller pension as a result of the changes the government made.
Overall, the point is that the tax burden continues to grow. If hon. members opposite doubt what I am saying, I would refer them to something in the 1996 budget documents, which is that the real way to measure whether the tax burden of a country is going up is to look at the tax level to GDP. Back then it was about 14%. Now it is up to 17%. That is at the federal level and this is the government's own measurement that we are talking about. Taxes are ramping up. That is the objective fact. It is not our data; it is the government's data.
We can forget about what the government tells us about taxes going down. The true fact is that taxes are going up and the government should be straight with Canadians.
Tax relief is extraordinarily important for getting our economy moving again at a rate where it will produce the types of jobs we once took for granted. Some people doubt that tax relief actually helps productivity, but there are a couple of ways it does that. I mentioned brain drain a minute ago. If it will stem brain drain it will help our productivity.
The second point I want to make came up again at the finance committee yesterday. Another way that lowering taxes will help productivity over the long run is that it will help capital formation. There are a couple of ways it does that. If we lower income taxes overall there will be more money in people's pockets. If we lower capital gains taxes we suddenly free up all that locked in capital which people are afraid to cash in. They know there will be a huge tax bill if they do that because of the high capital gains taxes we have in Canada.
Between cutting personal income taxes and lowering capital gains we free up a lot of capital that is currently locked into investments that otherwise would not be locked in. There would be a better return on investment. Ultimately a pool of capital would be formed which would allow individual workers to produce more. That is the rough definition of what improving productivity means. When we improve productivity the standard of living for Canadians goes up. We need to start lowering taxes for that reason as well. Those pools of capital will be formed and then all of a sudden they will be used to start new businesses of various kinds.
The evidence is very clear. In the United States when capital gains taxes and income taxes were cut we saw a boost in revenues. The reason for that is just what I pointed out a minute ago; all of that potential was unlocked and all of that money all of a sudden came forward. Some of it was taxed, but people were happy to have it taxed because it was taxed at a lower rate and they were able to use the bulk of it to create jobs by starting new businesses and that kind of thing. Ultimately everybody was better off. The government even brought in more revenue. How can that be a bad thing? It is a very good thing.
As the chairman of the finance committee pointed out yesterday: Does everyone agree that we have to produce more wealth before we can redistribute the wealth? That is a good point. I am glad my Liberal colleague from Toronto made that point. Certainly members on this side agree with it.
This brings me to the end of the first half of what I want to say. In essence, I do not believe that Bill C-71 brings about the productivity benefits that many of us believe we have to have in Canada. It simply does not lower taxes enough. It does not deal with things like regulation. It does not lighten the burden for Canadians. It does not unlock all that wealth that we could be using to produce jobs and give people the personal financial security that so many people crave today.
Many families are absolutely stressed out because both parents have to work, and not because they want to. They have to because Canadians are taxed so heavily today. This government really does punish people for the great crime of trying to make a living. That is absolutely wrong. We need to see some major tax relief in Canada, not when it suits the government but today. If we do not deliver it today we lose all kinds of opportunities every day. We lose all kinds of opportunities for investment, more jobs and wealth that will benefit everybody. We need to have that. That is one big reason that I oppose Bill C-71.
I want to talk about the other major aspect of Bill C-71, the part of the bill that addresses the issue of health care.
Bill C-71 is part of the budget that came down in February when the government put back some of the money that it originally took out of health care starting in 1995. Basically for every $2 it took out it put about $1 back in.
By anyone's definition that is a shell game. It is not a question of improving health care. It devastated health care on the one hand. Then it put a band-aid on it with the other hand and wants to be patted on the back for it. As somebody once put it, it has gone out and started a huge fire. Then it tries to put it out and wants credit for saving everyone because it put out the fire. That is a ridiculous approach.
We need to acknowledge that some money has to go back into health care. We also have to point out that this is only a stopgap. We have to find other ways to make health care more effective in Canada.
My colleagues across the way like to talk about how much more superior Canada's health care system is to that in the United States. It is superior in many ways. I agree with that. However, we need to assure Canadians that just because we do not necessarily support the health care system as it is today the American system is not the only other option. I do not want the American system. There are many things about the American system that are horrible. I do not like a lot of what the American system is about. That does not mean that we cannot improve the Canadian system. There are many things wrong with the Canadian system.
I heard my colleagues across the way talk for five years about how wonderful it is that we all have equal access to the health care system in Canada. More or less that is true, but we do not have equal access to health care. We might have equal access to the system. We have equal access to a waiting line. In Canada today over 200,000 people are on waiting lists to get surgery. That is ridiculous.
I know from personal experience, as I am sure colleagues on both sides of the House know, that family members are sometimes stricken with a serious illness and end up in the hospital. It could be because of an accident or for some other reason. Very often they cannot get the treatment when they need it. I personally have had family members who had to wait seven or eight weeks with extraordinarily serious illnesses. That is wrong. When the health care system denies people health care when they need it, it is time to take off the blinders and say that we have to make some fundamental changes to health care. It is not serving the public well.
Right now we are in a situation where relative to what the future holds the problem is fairly easy to solve. Down the road as the baby boom generation ages and is inflicted with more and more sickness and ill health that come with old age, we will be in a situation where the health care system, as presently constituted, will be under unbelievable pressure. We will see the great bulk of the population needing to get health care treatment and the little remnant that is left, the people still in the workforce, having to pay for it. The government has not done anything to prepare for the coming crunch in health care.
It is time to quit cranking up the rhetoric about American style health care and deal seriously with the issues. There are ways to do it. The first thing we have to do is find ways to accommodate some flexibility for the provinces in dealing with this issue. They fund the great majority of health care in Canada.
By the way, while I am talking about this point, I should point out that friends across the way will often say that American health care is a private system and in Canada it is a public system. That is baloney. First, the United States funds publicly about 47% of its health care. In Canada our public funding is 69%. We both have substantial public investments but we also have big private components to our health care.
I think we should lay that on the table and make sure people are clear about it. Let us not have a phony debate about not having any private health care in Canada at all because we do, and let us not pretend that they do not have in the United States because it does.
Going back to the provinces, we know for instance in Alberta that in the past the provincial government has tried to find some ways to take the pressure off the waiting lists for health care. It did that by allowing a public-private system for eye surgery, for instance. In doing so many people were able to go to the Gimble eye clinic and get eye surgery. They did not have to wait for weeks and weeks or months for a service that they wanted and in some cases really needed. At the same time it opened up a spot on the public system so that someone else could move up and get surgery faster.
When the federal government got wind of that it said it could not have it; it just made too much sense. It punished the Government of Alberta by cutting back the transfers to Alberta. That was a huge mistake. It sent a message to all the provinces that the federal government would not allow them to be creative and find ways to help their citizens, or would not deal with the upcoming health care crunch by giving them some flexibility.
The federal government plays the phony game of Canada having public health care and that is all it has. As I pointed out, about a third of our system is already privately funded and has not meant the disintegration of health care. To the contrary, it has meant that we have had some money go back into the system so that we can give people health care when they need it.
The only thing I can think of that is worse than having to pay for health care out of our own pockets is not having health care when we need it. Unfortunately we just do not get it in the health care system in Canada today.