House of Commons Hansard #130 of the 37th Parliament, 1st session. (The original version is on Parliament's site.) The word of the day was budget.
Jean Chrétien LiberalPrime Minister
Mr. Speaker, we have had five budget surpluses in a row. When we started we had a $42 billion deficit. Our plan at the moment is to still have a balanced budget and to have money to stimulate the economy, to develop the infrastructure, to help health care and to help many sectors of our economy.
We will do that. At the same time, the ministers, the President of the Treasury Board and everybody will make sure that when money is not well spent, it will be corrected immediately.
John Reynolds Canadian AllianceLeader of the Opposition
Mr. Speaker, I would not brag about the mess that was left in 1993. Anybody could have done better than what was there in 1993.
Last week the Prime Minister's press secretary said that he was writing the budget, not the finance minister, and it shows. With his tax hikes, wasteful spending and near deficit, this is a budget that only unreconstructed sixties Liberals would appreciate.
The question is: Will the real author of the budget please stand up?
Jean Chrétien LiberalPrime Minister
Mr. Speaker, the Minister of Finance is responsible for the budget but the Prime Minister has to approve the budget. On top of that, the Prime Minister is a former minister of finance so he has an interest in the budget.
What is great is that we have managed to have nine budgets that have served the Canadian population very well. Never ever has the Minister of Finance complained about the Prime Minister or the Prime Minister complained about the Minister of Finance.
Jason Kenney Canadian Alliance Calgary Southeast, AB
Mr. Speaker, I see the finance minister was dutifully applauded.
Last spring the Canadian Alliance predicted that the finance minister's out of control spending would lead us back into a deficit. Now we learn that is exactly what has happened, but he is trying to cover it up by cooking the books.
According to the TD Bank, the finance minister was only able to avoid showing a deficit by “fancy accounting footwork”. Both J. P. Morgan and Merryl Lynch say that a deficit is likely next year.
Why does he not just admit that without his creative accounting Canada would be headed back into a deficit?
Paul Martin LiberalMinister of Finance
Mr. Speaker, Canada is not in deficit. We are the only G-7 country not in deficit. We are not in deficit this year and we will not be in deficit next year, nor will we be in deficit the year after.
The hon. members talk about wasteful spending. I would like to talk about the $16 billion in wasteful spending, so I have gone back to take a look at what they are talking about.
Let me tell the House what their wasteful spending is: $1.5 billion pension and health benefits for veterans; $1.1 billion for labour market training, employment assistance to persons with disabilities and helping the homeless.
Jason Kenney Canadian Alliance Calgary Southeast, AB
Mr. Speaker, I think he is referring to his record. It is certainly not anything we proposed. It is simply not true.
The finance minister had to break every known accounting rule by pushing $2 billion of revenue from this year into next year in order to show a bare surplus. If he was treasurer of a public company that kind of snake oil would land him in court and out of a job.
There is no debt reduction, no tax relief, no support for health care or agriculture and yet he still had to cook the books in order to show a surplus. Why does he not just admit that he is leading the country back into deficit as the economic experts are telling us today?
Paul Martin LiberalMinister of Finance
Mr. Speaker, why does the hon. member not tell the Canadian people what his real agenda is? The fact is the Alliance members talk about agriculture. Of the $16.5 billion that they said was wasteful spending, $800 million of it went to farmers; $1.1 billion went to universities to support research and scholarships; $5 billion went to aboriginals for health care, education and social services.
The real agenda of the Alliance is to gut the social fabric of the country and the Canadian people will not put up with it.
Gilles Duceppe Bloc Laurier—Sainte-Marie, QC
Mr. Speaker, the creation of an infrastructure foundation will do nothing to stimulate the economy.
Instead of acting immediately, the government preferred to wait until the fall of 2002, not to build, but only to establish the budget of the new foundation, on the condition, of course, that the government runs a surplus. At best, work will begin in the spring of 2003.
Had the government really intended to invest immediately in the economy the $2 billion it claims to want to allocate to the foundation, why did it not simply improve the existing infrastructure program, as Quebec is asking it to?
Paul Martin LiberalMinister of Finance
Mr. Speaker, we were very clear about the fact that, as soon as the legislation is passed, by March 31 next year, the foundation will be ready to function and certainly ready to meet with anyone, province, municipality or private sector, in order to begin work as soon as possible.
Gilles Duceppe Bloc Laurier—Sainte-Marie, QC
Mr. Speaker, the current program has barely begun to pick up momentum. The project approval mechanism is finally working, such was the shortage of funds available compared to the demand.
Would it not have been better to put the money back into something that works now, than wait until 2003? The results will have to come in—that is what the budget provides—before the $2 billion appears in the expenditure column.
So, my question is: what exactly is the purpose of this foundation?
Paul Martin LiberalMinister of Finance
Mr. Speaker, the purpose is the one identified by the representatives of the Union des municipalités du Québec, when they said “We are pleased with the added investment of $2 billion in major infrastructure projects. As for the mechanism planned for the new strategic foundation, we consider it to be a reasonable approach, at first glance”.
Yvan Loubier Bloc Saint-Hyacinthe—Bagot, QC
Mr. Speaker, this latest sleight of hand will allow the federal government to keep the provincial governments out of future negotiations and deal directly with the municipalities.
Will the Minister of Finance acknowledge that by setting up this foundation, the federal government will be able to systematically shut the government of Quebec out of infrastructure projects?
Paul Martin LiberalMinister of Finance
Mr. Speaker, the purpose of the foundation is to ensure that funds are being allocated constantly, because there is an incredible demand for infrastructure throughout Canada, including in Quebec. We intend to satisfy these demands, be they from the provinces, the municipalities or the private sector.
Yvan Loubier Bloc Saint-Hyacinthe—Bagot, QC
Mr. Speaker, if he recognizes that demand is so great, why did the minister not simply put more money into the existing program? That would have been faster.
Is the real purpose of this foundation not to interfere in Quebec's areas of responsibility and create more squabbles and additional delays, when it would have been so much simpler, faster and preferable to invest directly in infrastructure to jump start the economy? There are needs; all he had to do was put money towards them.
Paul Martin LiberalMinister of Finance
Mr. Speaker, that is absolutely ludicrous.
There is already the $2 billion infrastructure program that we are ready to move on, if the provinces are ready, if Quebec is prepared to stop delaying the situation. There is the $680 million affordable housing program. We have just doubled the money set aside for municipalities to undertake green projects, such as water treatment.
Now we have created a new structure that will ensure that there is continued confidence in the economy, and that these infrastructures are put in place. So, the member should be supporting us.
Lorne Nystrom NDP Regina—Qu'Appelle, SK
Mr. Speaker, my question is for the Minister of Finance.
The Minister of Finance is reported as having said that he gave an advance briefing on the budget to American treasury secretary, Paul O'Neill. The Globe and Mail even said that he got a thumbs up from Mr. O'Neill.
What I would like to know is since when does the Canadian government seek pre-approval on its budget from a foreign government and why is the Minister of Finance taking his marching orders from Washington instead of the Canadian people?
Paul Martin LiberalMinister of Finance
Mr. Speaker, I must say that it is quite clear we are getting to the end of the year and running out of questions.
The fact is the Minister of National Revenue and myself met with Mr. O'Neill. We told the Americans what we intended to do. We then confirmed it in a press conference after that particular meeting and then we asked the Americans to follow our lead.
Lorne Nystrom NDP Regina—Qu'Appelle, SK
Mr. Speaker, is the Prime Minister satisfied that this was not a breach of budget confidentiality? If it were, it is a serious matter. If the Prime Minister had any control over his would-be successor he would call him onto the carpet now and demand an explanation.
Will the Prime Minister now take the Minister of Finance out to the woodshed on this matter, which is a very important issue for the Canadian people?
Jean Chrétien LiberalPrime Minister
Mr. Speaker, we can discuss the programs we have with other governments and that we intend to invest money in infrastructure at the border. It was discussed here in the House of Commons and in committee. The ministers talked about it, we agreed to do it and money was allocated this week. We have been discussing the subject since September 12.
Scott Brison Progressive Conservative Kings—Hants, NS
Mr. Speaker, this year, for the first time in six years, the Canadian government will have to borrow to cover its costs. The government is going to private capital markets to raise $1.9 billion this year and $1 billion next year.
Does the finance minister admit, based on accounting practices used in the U.S., Japan and Germany, that his government will be in a deficit position this year?
Paul Martin LiberalMinister of Finance
Mr. Speaker, the hon. member's information is correct. The government will not have to go to the markets to borrow new money.
What the government is doing, which is being financed internally, is providing institutions like Canada Post and a number of other institutions with the funds to go into the market because it is more important for them to do so for pension fund liabilities.
Scott Brison Progressive Conservative Kings—Hants, NS
Mr. Speaker, even the minister's fancy footwork is not going to work on this one. The fact is that the senior economist of J.P. Morgan is saying that a budget deficit this year is “highly likely”. TD Bank economists are accusing the minister of “fancy accounting footwork” to avoid the appearance of deficit.
Instead of fancy footwork to avoid the appearance of deficit, why does the minister not listen to the auditor general and cut wasteful Liberal spending so that Canada can avoid the reality of deficit?
Paul Martin LiberalMinister of Finance
Mr. Speaker, the only thing I can do is do exactly what I did with the Alliance, which is to point out the wasteful spending to which the hon. member is referring. It is money for health care, for pensions, for international assistance and for labour market training.
I cannot believe that the hon. member, who up until now I thought had a social conscience, would identify with the Alliance Party in the gutting of the social fabric of the nation. Maybe they ought to merge.
Grant Hill Canadian Alliance Macleod, AB
Mr. Speaker, let us talk about the wasteful spending. How about home heating fuel rebates to the dead? How--