Mr. Speaker, the 1999 budget presented by the Minister of Finance was terribly disappointing, given the immense possibilities for intervention that we calculated were available, even as far back as 1998. The surplus, which he estimated at a minimal figure, was in fact far larger than he implied.
To give the taxpayers, who are entitled to know the true state of this country's finances, a bit of an idea of the situation, in the three years between 1997 and 1999 the Minister of Finance made a forecasting error of an average of $15 billion. He was an average of $15 billion off in forecasting the surplus.
Year in and year out since 1998, the Minister of Finance has been forced to revise his forecasts on the surplus. Again recently he told us in the 2000 budget that his forecast surplus for the next five years was $95 billion in all. Knowing him, it is far more than that. The Minister of Finance is, once again, being sneaky.
When the forecasts are looked at by anyone, whether by specialists or by the Bloc Quebecois, we expect as a minimum over the next five years, conservatively, a surplus of $140 billion.
So the minister could have done far more in 1999 to help those who are worst off, the most disadvantaged, and could have taken a different tack as far as tax reform is concerned, particularly by decreasing the income tax. He could have re-established a proper employment insurance program, but he did not either then or in his budget 2000.
Recently, I read a document which the Prime Minister of Canada presented in Germany. In this document, The Canadian Way in the 21st Century , he said the following:
The success we have achieved as a nation has come not only from strong growth but from an abiding commitment to strong values—caring and compassion, an insistence that there be an equitable sharing of the benefits of economic growth.
A little later, page 5 of the document states:
—a society of excellence with a commitment to success—
In speaking of Canadian society, the Prime Minister added:
—a society where prosperity is not limited to the few, but is shared by the many and where every child gets the right start in life.
Since 1993, when this government came to office, the third way, the Canadian way, has primarily consisted of cutting everywhere, particularly in the Canada social transfer and in the employment insurance program. The government also constantly displays inertia with regard to tax reform to lighten the burden of low and middle income taxpayers.
The Prime Minister's document presents a picture that is just the opposite of reality in Canada. It says that children must get the right start in life, but since this government has been in office, the number of Canadian children living in poverty has increased from one million to one and a half million. There are 1.5 million children who are not all getting the right start in life, to use the expression found in the document entitled The Canadian Way in the 21st Century . In this document, the Prime Minister describes a theoretical reality, a utopia, a picture that is totally different from the true picture in Canada.
The Prime Minister talks about an “equitable sharing of the benefits of economic growth”. For the past seven years, the economy has constantly been growing. This is unprecedented. The economy is continually growing. How is it that we find ourselves with figures such as the ones I just mentioned, with 1.5 million children living in poverty, while there were one million in 1993, before this government took office?
How is it that, for all categories, particularly single mothers with children, poverty has increased so steadily? How is it that, for the first time in 30 years, it was noted—by the National Council of Welfare—that the income of seniors had dropped? This is something not seen in 30 years, since measures such as old age pensions, and so on were introduced to help old folks, as they were then called, out of their poverty. How is it that we have reached this state of affairs?
The situation for female seniors living alone is even worse. They are one of the poorest categories in the country.
When the government is talking about sharing, equity and compassion, how is it that—the Prime Minister is going to say this in Germany, but he would not dare to say it here—the situation in Canada is actually the opposite? If the government has so much compassion, how is it that, when it tabled its budget in 1999, and again last February, it did not restore the Canada social transfer that has been so drastically cut since 1994?
How is it that this situation is allowed to continue and that, in 2001-02, there will be cuts of more than $30 billion in the Canada social transfer to the provinces to fund health, postsecondary education and social assistance, and income security for the poorest Canadians?
How is it that in 1993, 1994, 1995, 1996, 1997, 1998, 1999 and 2000, this government, with all its compassion, has not set aside one additional dollar for the construction of social housing, when people growing poorer and poorer are spending over 50% of their income on accommodation? Already at 30%, people are considered badly off and unable to afford to put a decent roof over their heads, buy food and clothing, pay for drugs, and so on.
How is it that this compassionate government has been working since 1993 to make people poorer? How is it that for about the past four years the new employment insurance plan has marginalized some 60% of the unemployed? How is it that such a compassionate government is allowing a situation to go on in which, according to its own figures, only 43% of the unemployed are entitled to employment insurance?
How does this government, with the Canadian way, the third way of the Prime Minister, let the situation happen? How is it that, despite the huge surpluses of the past three years, the government has given no thought to the disadvantaged? Is this the Canadian way? Is this the third way? Is this a vision?
We in the Bloc Quebecois think it is, because, since this government came to office, the only way it has shown us is the way of further centralizing powers in all areas of jurisdiction. It involved keeping taxpayers' money in its pockets. It involved stealing money from the unemployed and putting it in its own pockets. It involved stealing money from the most disadvantaged. It involved taking money from the poorest families in this country. It involved stealing bread from the mouths of the 500,000 children who have been added to this government's record of poverty since its arrival in office.
That is what the Minister of Finance is doing. That is what this government has done since 1993.
If the Minister of Finance forecasts a surplus of $95.5 billion for the next five years, it means that some of the 30 million Quebecers and Canadians will have less in their pockets. This means that those who already did not have enough have just had some of what they did have stolen from them by the Minister of Finance.
Over the next five years, the plan is to take still more from them. Their money will be taken from them. What little they have in their pockets to meet their basic needs will be taken from them. That is what is being announced to us.
When the minister tells us that there will be a surplus of $95.5 billion—that is a very conservative minimum, because our estimate is $140 billion, and our forecasts have not been a single percentage point off since 1994 when we started doing them—this means that he is going to get it somewhere, and that somewhere will be our pockets, as it has been since 1993.
Part of the large surpluses that have accumulated in the past three years, and will continue to accumulate in future, comes essentially from three sources: cuts to the Canada social transfer, which goes to provide sick people with a decent health care system, cuts to the Canada social transfer for income security—those poor children I referred to a while ago—and cuts to post-secondary education. This is the first major source: the Canada social transfer.
The next is the employment insurance surplus, which is some $6 or $7 billion every year.
The Minister of Finance helps himself to that. Already a $32 billion surplus has accumulated in the employment insurance fund, and the Minister of Finance has helped himself to it. Most of it comes from small and medium size businesses and from workers. He also helps himself from the pockets of the unemployed who are not eligible from employment insurance.
That is the Canadian way. That is what the Canadian way has meant to us since 1993. There is no compassion; they go after the most disadvantaged, they cut transfer payments to the provinces.
The government leaves it up to the provinces, which provide the first line of direct services to the public, to deal with problems that have their roots here. In the meantime, the Prime Minister travels all the way to Germany to talk about the Canadian way.
It is the same with taxes. The situation is so serious that the federal tax has become a major contributing factor to families getting poorer. This is unprecedented. Originally, federalism meant policies based on fairness, compassion, redistribution and equalization. We now have a situation where, from a tax point of view, instead of helping poor families and families saddled with huge responsibilities, the government is crushing them.
Families—and I am talking about families with two adults and one child—start paying federal tax as soon as their income reaches $13,700. By comparison, families begin to pay tax to the Quebec government only when their income reaches $30,000.
At the federal level, because of the tax structure and the lack of indexation during all these years, a family with two adults responsible for a dependent child starts paying federal tax when its income reaches $13,700. Of course, this is hard to understand for a millionaire, for the Minister of Finance, for a shipowner who does not pay tax in Canada but, instead, pays a minimal amount to tax havens. It is difficult to understand that an income of $13,700 is well below the poverty threshold.
The poorest find themselves in that category: $13,700, two adults, one income and one dependent child. They pay federal income tax in order to fatten the surplus of the Minister of Finance, to cover the income tax he does not pay because his ships fly the Panamanian flag, because he does business in the waters off tax havens. As the Minister of Finance, he takes money from couples with one child when their income reaches $13,719, whereas in Quebec it is at $30,000—a bit better—that this family starts paying income tax.
The government has not reformed taxes, as we have been asking it to do since 1993. The aim of such a reform is to re-establish some balance and fairness in the federal tax system, which now adds to poverty.
With the tax paid at this income level, it means that the people Statistics Canada and others call the poorest people, the most disadvantaged, who spend probably more than half their income on housing, who have a hard time making ends meet, are beginning to fill the pockets of the Minister of Finance, a millionaire shipowner, the owner of ships flying the Panamanian flag, who pays tax elsewhere than in Canada.
I do not understand why, up to now, people have not rebelled more against this. It is an absolute scandal to find ourselves in such a situation. And the federal tax system is not unfair solely for a family of two adults and one child. It does not add to the poverty of just this one socio-economic category; it also adds to the poverty of a single parent family with two dependent children. This family too starts paying income tax at $13,719. It is already having trouble—because it is usually headed by a single mother with children—making ends meet. There is never enough at the end of the month to feed and dress her two children, keep them warm and pay the rent. This government, with the Minister of Finance at the helm, will drain them of the few resources they have.
That, then, is the Canadian way, the Prime Minister's third way: crushing the weaker members of society, who can barely manage, crushing the most disadvantaged, those who are already discouraged and depressed, who have perhaps lost the will to fight. And all to help the rich get richer. The opposite of Robin Hood is what the Prime Minister's third way is.
In the 1999 budget, the one that we are interested in, there was one tax relief measure, and one only, that made sense. I should say that it was consistent, because in my view, it did not make sense, but perhaps it did to the millionaire friends of the Minister of Finance and the Prime Minister.
The 3% surtax was abolished. This was a surtax introduced in order to reduce the deficit. The thinking was that, since there was no longer a deficit, they would abolish the tax. What is not mentioned is that the category that has benefited most from the elimination of this 3% surtax is those with incomes of $250,000 and up.
These guys, the Prime Minister's friends, people like Mongeau and company who are getting their palms greased with our money—you know, the buddies—got a $3,700 tax break in one shot, whereas single families with two children earning $13,719 a year got nothing in 1999.
In 2000, they will not get much more. A few years down the road we might hope that, with full indexation of the tax tables, they might start paying taxes on a slightly higher income of $14,000, $15,000 or $16,000. Nevertheless, they are below the poverty level and federal taxes are making them poorer.
This is compassion, according to the Prime Minister of Canada, who goes to Germany to deliver his speech. He is afraid to deliver it here, because he is afraid that people will point out to him that the only tax break in 1999 was for the rich, and that it is the same thing in 2000. The only significant tax break was the lowering of the surtax from 4% to 3% in 1999, and its phasing out in 2000.
Again, those who benefit from the bulk of this tax break, which amounts to more than $4,000 in the 2000 budget, are people making over $250,000 a year. This is what the Prime Minister calls compassion and a fair redistribution of the dividends of economic growth.
Taxation is one of the reasons retired couples over 65 years of age are getting poorer. I mentioned earlier that for the first time in 30 years the welfare council found the elderly were getting poorer. This is happening for the first time in 30 years, because measures had been taken to allow senior citizens who had worked all their lives to have a decent retirement income. Yet, retired couples over 65 start paying federal tax when their income reaches $20,000. An annual income of $20 000 is not much. It is below the poverty level, yet federal income tax makes those people even poorer.
With surpluses coming out of his ears, the Minister of Finance could have made a small effort in 1999 and in 2000 and reduced income tax, given back what he took to the poor, made the employment insurance system somewhat fairer, invested more money in social housing and restored some balance in the tax system.
If he believes that surpluses are still not high enough, when he is strangling us with income tax, crushing the neediest and raising all statistics on poverty, the minister might have changed the corporate tax system as well. He could have forgotten his cronies. He could have said to Thomas d'Aquino and others, as well as to large companies, that the time has come for them to pay income tax like everybody else.
The statistics are alarming, at least the ones we know about, because the Minister of Finance stopped publishing this type of data several years ago, the statistics on taxes deferred by large corporations and due to Revenue Canada. This is alarming.
Figures were published by the Canadian Labour Congress, figures which we had ourselves compiled in 1994 when we arrived. In 1995, we could no longer compile these numbers because the Department of Finance had asked, by order of the Minister of Finance, that the data no longer be published.
Some large corporations, which make a profit year in and year out, have paid no income tax for the last ten years. In 1994-1995, it was estimated that the federal government was losing $35 billion a year. The situation has not changed considering the fact that, since 1994-1995, our economy has been growing and businesses, especially large ones, have been making record profits.
Believe it or not, even the most profitable businesses never pay taxes even if they owe taxes to the federal government. For example, Bell Canada, whose chairman, Mr. Monty, has been appointed as head of the millennium scholarship foundation, owes Revenue Canada $2.1 billion. These taxes are deferred year after year, but it is money owed to Revenue Canada.
BCE, Bell Canada Enterprises, which includes all of Bell Canada's communications businesses, owes Revenue Canada $2.3 billion. I see that the secretary of state is smiling over there. I do not see anything funny in the fact that businesses such as Bell Canada and BCE, which are worth billions and are making money, and whose chairman, Mr. Monty, has stated that he wanted to buy CTV for $2.3 billion, are not paying taxes. That is exactly the amount he owes Revenue Canada.
In other words, Bell Canada Enterprises wanted to buy CTV with our money, the money it owes us. Let us not forget that, when BCE does not pay its taxes to the federal government, that money has to come from somewhere. It is taxpayers like you and me, the single parent with dependants, who have to make up in part for the taxes not paid by Mr. Monty and Bell Canada. They will also have to make up in part for the taxes not paid by the Minister of Finance. They will have to make up in part for the taxes used for patronage, for contracts awarded by the CIO, the Canada Information Office.
We saw that this week. The Bloc Quebecois leader and House leader have raised these questions with my colleague for Chambly. People's palms are being greased with our tax money. It is already hard enough to earn a living, to have to file our income tax, because doing so—excuse the expression—irks us, but what is even worse is to know that these people are using our money to butter up their friends. The Mongeau affair is just the tip of the iceberg.
With the Human Resources Development Canada scandals, the CIO scandals, with communications contracts being awarded for the monkey business of having federal ministers traipsing about Quebec spreading propaganda, trumped up contracts for checking spelling and punctuation to the tune of $250,000 and other such stupidities, we can see where our money is going.
When we see a grant intended for the riding of our colleague from Rosemont end up in the riding of the Prime Minister, when the invoices supporting this are not forthcoming, there is a problem. We can now see that the scandals, the propaganda, the buddy system, the sloppiness in administering public funds, have become systemic. We have, to use Fabienne Larouche's term, become a banana republic. This is totally senseless.
The Minister of Finance, with surplus money spilling out of his pockets, is announcing some very bad news at the same time. It is very human to behave that way: the more money a person has, the less attention a person pays to it, especially when it is someone else's money. The Minister of Finance will have a big surplus over the next five years, a lot of money but not his. In time, the financial administration will become still sloppier. The Minister of Finance has surplus money coming out of his ears but it is not his money, so what does he care? This government's sloppiness will increase, that is a sure thing.
Therefore, the Minister of Finance is announcing the very bad news for Quebecers, who pay $32 billion in taxes to this government, that their hard-earned money, part of which goes to the federal government, is being used for propaganda, choosing political friends, greasing the palms of party friends, providing grants so as to arrange under the table for donations to the Liberal Party of Canada. This is unacceptable.
The 1999 budget is like the other ones; it is just like the others. It is, in any case, just like the 2000 and 1998 budgets.
It is a totally heartless budget, compared with the third way, supposedly the Canadian way, as presented by the Prime Minister.
These budgets contain no provision for lightening the burden of low and middle income taxpayers. Like the others, this budget offers nothing to ease misery in Canada. On the contrary, it contains the seed of what appeared in the last budget and what may well appear in future budgets, the failure to restore the Canada social transfer.
The government will continue to dip blithely into the annual employment insurance surpluses of $6 billion to $7 billion by keeping contributions high.
As for tax cuts, we can forget about those, because every time the Minister of Finance makes a dramatic announcement about lowering taxes, a closer look reveals that he has done nothing. A closer look reveals that he is taking away with one hand what he is giving with the other.
Mention was made of cost recovery for expanding government services, particularly for agricultural SMEs. The government lowers taxes a bit and increases indirect taxes by implementing cost recovery for expanding federal programs, which was recently criticized by the Canadian Federation of Independent businesses as one factor cutting into the competitiveness of SMEs.
I would like to make one further comment about this budget. The 1999 budget contained a sad piece of news. It had to do with the level of compensation for victims of contaminated blood, of hepatitis C.
The House will remember, as the Bloc Quebecois has done since the beginning of this issue, in connection with the work done by the member for Drummond and continued by the member for Hochelaga—Maisonneuve, that victims who contracted the disease before 1986 and after 1990 are still not entitled to any compensation, although they contracted the disease in exactly the same way as everyone else.
It is sad to be talking again about the 1999 budget when we know that there may be thousands of people who deserve compensation because they have suffered serious health consequences. Some of them may already have died. With surpluses of $95.5 billion, this government is not even thinking about revisiting this issue and providing compensation for victims who contracted the disease before 1986 and after 1990, who have still not received anything.
I will conclude by saying that, for all the reasons I have given and because of the fact that there has not been adequate compensation for hepatitis C victims, the Bloc Quebecois will be voting against this bill, with our usual vigour.