Mr. Speaker, it is with pleasure that I rise today to speak to Bill C-17 amendments to the Budget Implementation Act, 1997. The absurd nature of being in this place in the year 2001 debating retroactive changes to the budget of 1997 is self-evident. In any case, I will focus most of my comments on the Canadian foundation for innovation fund.
The government has consistently, particularly beginning in 1994-95, slashed transfers to the provinces to such an extent that it created a tremendous vacuum in funding for universities throughout the country. The provinces were simply not able to maintain adequate funding to our post-secondary universities and community colleges across the country.
As a result of the deficit that existed in the funding of post-secondary education we saw, for instance, the doubling of the average amount of student debt after a four year program in Canada. We saw tuition doubling not just in one province but across the country.
The Canadian foundation for innovation was introduced in 1977. The government has tried to make up with its federal granting programs some of the ground it eroded from beneath the provinces in the disabling effect of federal cuts to the transfers to the provinces, which created in many ways havoc across the country.
It is still my belief that in terms of education and health care spending the best decisions are typically made by the government closest to the people affected by those decisions. As such, provinces are in many ways much better suited to make long term and visionary decisions on behalf of the people they represent than the federal government, particularly in the areas of education and health care.
While the government has cut and slashed transfers to the provinces, which are in many ways the most appropriate vehicle for delivery of funding to our post-secondary education infrastructure, it has now tried through the foundation for innovation to make up for lost ground and to try to directly fund infrastructure investment focused on the areas of research.
The notion of government helping in investing in the research infrastructure that is so important for Canada's competitiveness in the new economy is not a bad one. I would argue that the investment being made by federal or provincial governments, preferably by provincial governments, is extremely important. There are some flaws, however, in the Canadian foundation for innovation model as applied over the last three years.
One benefit in a perverse way of debating amendments to the Budget Implementation Act, 1997, in the year 2000 is that we actually have the opportunity to be talking about some of the devils in the detail or the flaws in the implementation that are now more self-evident than they would have been in 1997.
In a realistic and applied sense, and not simply as a perceived issue, there is an anti-small university bias in the Canada foundation for innovation granting scheme. As a result smaller universities do not have the same level of access to these grants as some of the larger universities.
This is unfortunate because one of the cornerstones of Canadian post-secondary education infrastructure is the network of undergraduate program universities which perform a very important service to the future of Canada by providing a steady stream of enthusiastic graduates in science programs that may perhaps have graduated with a decision to pursue graduate or post-graduate studies.
In that way the undergraduate programs are performing a very important service to post-graduate institutions by providing an ongoing stream of students and young people with the enthusiasm to pursue post-graduate studies in many of those areas.
Representing a riding in Nova Scotia, and Nova Scotia being the cradle of higher education in Canada, there is a strong tradition in our province of providing some of the best post-secondary university experiences in the country.
There are some challenges. In my riding of Kings—Hants I am very proud to have Acadia University. Acadia University, like many of Canada's smaller universities, simply does not have the same access to the Canada foundation for innovation funding as some of the larger universities.
I have heard the arguments about a need to create levels of critical mass when it comes to research. Some of them are anachronistic. Critical mass can exist through a less parochial approach to research. Universities can co-operate to a greater extent and we should be working to encourage that. Certainly with the death of distance as a determinant in the cost of telecommunications, researchers can be connected via technology and do not necessarily have to be in the same classroom or the same lab, discussing and sharing their ideas.
We should be ensuring that the parochial approach to research which has existed in the past in the university environment is reduced somehow by working with the provinces to ensure and encourage a greater level of sharing of intellectual property between universities.
As a country we need to develop a better approach to commercialization of intellectual property at the university level and to technology transfer. In many ways American universities are much more successful at commercialization and tech transfer than we are in Canada.
As we try to achieve those two goals in that environment we should ensure that granting programs like the Canada foundation for innovation reflect the realities of the diversity of Canada's post-secondary university infrastructure and do not focus purely on some of the larger universities. It should try to address and invest in some of the smaller universities which are providing such an important contribution.
The other issue deals with matching funds. I believe 60% of the funds need to be matching funds. In provinces like Alberta or Ontario where there is a stronger fiscal position than there is in a province like Nova Scotia or Newfoundland, there is an inability on the part of the provinces to participate to the extent of the requirements of post-secondary institutions.
The matching fund issue is very serious and needs to be addressed more thoroughly. We would create a ghettoized post-secondary education granting system if we only contributed through matching fund schemes to universities in those provinces where the fiscal conditions permit an equal or greater investment by provinces and other entities within those provinces.
There has been a problem in the past where not enough foundation for innovation grants were making their way to Atlantic Canada. The government tried to address it last summer with the Atlantic innovation fund. That program was announced in the summer in a pre-election Hollywood-style announcement to try to enrapture Atlantic Canadians with the generosity and general kindness of the Liberal government. It did not work because most Atlantic Canadians saw through this shallow and feeble attempt to make up for past wrongs by a Liberal government that only found Atlantic Canada a few weeks before an election.
The Atlantic innovation fund has not even congealed to an extent that it can deliver any funding. Months later that fund, with its pot of money, is still sitting somewhere in Atlantic Canada with no notion as to how to deliver the money to the universities.
What is really bizarre is that while the government dilly-dallies and dithers with that fund to come up with a delivery mechanism with which to deliver the funding, the Canadian foundation for innovation is still in a position where it is providing money. Over the last several months it has provided an even more disproportionate level of funding to other parts of the country. Atlantic Canada is actually getting less because the notion is that the problem is solved, the Atlantic innovation fund is in place and the Canadian foundation for innovation does not have to be as vigilant now in Atlantic Canada.
That is simply not the case at all. There are also some concerns with ACOA acting in a role of a delivery vehicle for that funding. Concerns have been raised by people in the post-secondary environment and in the technology and high tech sectors. People in the economic development areas of Atlantic Canada have approached me directly to talk about this. They fear there is not enough understanding of technology in ACOA. They feel that ACOA can be an effective vehicle through which to develop a delivery mechanism for the Atlantic innovation fund but that it may not have the level of technical expertise necessary to develop a delivery mechanism for the Atlantic innovation fund. It therefore may not be able to achieve the ends that the government would like to see.
The fact is that if we are to be successful investment needs to take place in our post-secondary infrastructure. The devil is in the details. How are we to find the most appropriate way to ensure that the needs are met and that our competitiveness in this regard has improved?
There is a $3 billion deficit not just in research infrastructure but in general university infrastructure. It is a result of deferred maintenance among other issues and the government's callous disregard for education and health care funding. It let health care and education atrophy as it took its slash and burn approach to fiscal management and offloaded responsibilities to the provinces without considering what the end result would be. We will see a significant price paid over the long term for the loss in future competitiveness in these areas.
One of the fundamental flaws that needs to be addressed by the Canadian foundation for innovation would be the anti-small university bias which denies some of Canada's greatest educational facilities like Acadia University full and unfettered access to important funding opportunities.
The matching fund provision also needs to be addressed. It too discriminates against universities which happen to be in provinces that are less fiscally sound on a current basis. As a representative from Nova Scotia, the cradle of higher education in Canada, it is incumbent on me to defend the interests of my province in that regard.
Some of the macro issues are not addressed in Bill C-17. They deserve some level of debate and discussion when we are talking about amendments to the Budget Implementation Act, 1997.
Looking at Canada over the last 30 years and some of the changes that have taken place in terms of its competitiveness relative to other countries, our investment in post-secondary education can play a role in reversing what has been a very negative trend, particularly in terms of our competitiveness with the U.S.
However there are other issues too. In 1990 Canada had the fourth highest standard of living within the OECD. By 1999 we sank to seventh place with countries like Japan, Norway and Denmark overtaking us. In the last 15 years our real income per capita plummeted from 86% to 78% of the U.S. real income per capita. Ireland soared from 47% to 76%. Over a 10 year period Ireland increased its GDP per capita by 95%. In that same period Canada increased its GDP per capita by 5%. Our performance has been anemic.
We have seen a cyclical decline in the Canadian dollar over the last 30 years. This decline has become precipitous under the government. Over nine years of the Mulroney government the dollar lost one penny relative to the U.S. Since the Liberal government took power the dollar has declined by 12 cents. In 1990 as a Liberal leadership candidate the current finance minister said that if he were given the opportunity he would manage the dollar downward to about 78 cents. He did really well. He overshot his wildest expectations. The dollar is down to 63 cents.
The Prime Minister says that is just fine, that low dollars are good for tourism. The logical corollary of his argument is that if we reduce the dollar to zero we could be the greatest export nation in the world and be really successful. We all know how absurd and perverse is that logic or lack thereof.
There are things we have to do. In terms of government spending Canada's GDP represents about 40%. In the U.S it is 30%. Thirty years ago it was about the same, 30%. Our government's program spending has ballooned in Canada, but it has remained about the same in the U.S.
We have to reduce taxes. As a percentage of GDP, taxes in Canada are 10% higher than those in the U.S. We have to reduce our debt. I will propose one idea that over the next 30 years the government could address reversing some of these negative trends. If we were to reduce our debt in real terms over the next 25 years and apply the interest saved to reducing taxes, our economy would grow significantly both in real terms and as a percentage of GDP.
These are the types of forward thinking and visionary policy measures we do not expect from the members opposite but will see in the future under a different government.