Mr. Speaker, I will be sharing my time with the hon. member for Beaches—East York.
I am happy to take part in the prebudget debate. It is a great occasion for members of Parliament to comment on what they feel some of the priorities should be in the upcoming budget that will be presented by the Minister of Finance probably in February 2003.
The House of Commons just voted to ratify the Kyoto protocol. Now the hard work begins. The government must establish a central agency, body or department that would take the overall responsibility for coordinating the government's implementation plan. There are still many details to be spelled out.
In the 2003 budget I would like to see some economic instruments that would result in some signals to the economy and to Canadians. I would like to see some incentives, even perhaps some disincentives, although I favour the carrot to the stick. Incentives would offer encouragement for Canadians to change their behaviour and that is Canadian business, Canadian consumers and Canadian citizens. We will have to change our behaviour. The 2003 budget would provide an opportunity for the Minister of Finance to provide some well targeted and strategic tax incentives, and other economic instruments to facilitate the implementation of the Kyoto protocol.
There is no point in signing a protocol if we are not going to meet its objectives. The Kyoto objectives are ambitious ones. We need to start dealing with greenhouse gases. The Minister of Finance would have an opportunity in his upcoming budget to do some work that would assist us in meeting those goals.
I am a member of the House of Commons Standing Committee on Finance. Every year we travel across Canada to do our prebudget consultations. The committee talks to Canadians across this great country and asks them what the priorities should be for the upcoming budget. The House of Commons finance committee recently tabled its report to the House and set out a framework for the Minister of Finance, and indeed for the House, to consider in the fiscal plan to move forward.
There were some key messages there that we heard and that are reflected in the report. Canadians will not tolerate going back into deficit. We have worked too hard to get to a position where we have surpluses in our budget. We will be going into our sixth year of budgetary surpluses. We cannot even contemplate going back into deficit.
We do know that there are significant expenditure pressures on the government. We have the Romanow commission report on health care. We also have the Kirby report from the Senate dealing with health care. We should pick and choose some of the best recommendations from both reports. It does not have to be all or nothing with each report. There are excellent recommendations in both reports and the government should find the optimal solutions in working with the provinces on how we will bolster health care.
I have said from the start that we must put more money into health care. The health care system needs some re-engineering. We have patients in long term care beds which are costing taxpayers about a thousand dollars a day because there is no home care, no long term care or extended care facilities across Canada.
Recently I talked with the person in my riding who manages hospital beds. He said that 20% of the patients should not really be there. They should be in lower cost alternatives. That would be better for the patients and more cost effective as well.
Canadians have told us that we need to protect the $100 billion tax cut that was brought in by the former finance minister in 2000. This tax cut was the largest in Canadian history. Some would argue that we should go further. Perhaps we should go further in this budget. I am not so sure that it would be feasible. Certainly we should be looking at personal income taxes which are still out of line with the rest of the world. We should also take some steps to deal with the resource sector.
When the government brought the corporate tax rate down or phased it in over a number of years to 21% the resource sector was left at 28% and not for an illogical reason. They do have other tax incentives, such as the exploration tax credit, accelerated depreciation, and the resource allowance.
There has been enough discussion with the oil and gas industry and the mining sector that we should be able to deal with this comprehensively in the budget. It is especially important, given the Kyoto protocol, that the oil and gas industry and the mining industry are going to have some cost pressures on them. It is time that the minister announced in the budget a tax package that deals with the higher statutory rate that exists for those industries.
We should also not forget about the fact that we need to reduce our debt. Right now the level of debt to GDP is at 49% which is down from a high of 71% in 1995. The finance committee suggested that we set a target of 30% because we still are very heavily indebted as a nation and that is costing us a lot of resources annually just to service the debt. In fact, by having paid down what we have paid so far, $46 billion, that is saving $3 billion a year, each and every year. Those moneys could be redeployed for other higher priority uses.
There are also a couple of pet projects of mine that I would like to see the minister deal with in the budget.
One is tax policies that would encourage the formation of employee share ownership plans. In years past we have introduced policies that are supportive of the taxation of stock options and that is a positive development. We have also reduced the capital gains inclusion rate and the capital gains tax. Those are very positive developments but employee share ownership plans reach everybody in the company, from the receptionist, to the mail clerk, to the middle manager, to the driver, right up to the top. They are the people we need to reach.
We do know that companies with employee share ownership plans improve their productivity by 30% or beyond. We need to implement these policies so that we can improve our productivity because we still have productivity challenges in Canada.
I would like to see us help the voluntary sector more than we have done already. We have taken some very bold steps but I would like the government to eliminate the capital gains tax on the donation of marketable securities to charitable organizations. I also would like to see a level playing field with respect to private foundations. Right now private foundations do not have the same benefit as a public foundation with respect to the capital gains inclusion rate.
I would like to see a basic exemption on employment insurance of up to $2,000 a year which would allow students and others to be employed by restaurants and hotels. Companies would not feel they were being penalized by bringing in young people to work in their restaurants and hotels. It would be a job creator and the public purse would not be affected that negatively.
I support the recommendation in the finance committee report that the Canada Student Financial Assistance Act recognize refugees for student loans. My riding of Etobicoke North has a very large Somali Canadian population. Many of the women and children are stuck in their apartments. They cannot really reach out and be employed. Their children do not have access to student loans because they are refugees. These people are here to stay. I and others are trying to work with them to get their landed immigrant status but in the meantime, we should be encouraging them to get a higher education. If we do not, there will be a problem for society in the future.
With respect to more money for the provinces with the CHST, clearly we are heading down that road. It is the right thing to do but I would resist our government not calling for a greater transparency and greater accountability from the provinces. It does not mean we have to micromanage the health care system, far from it. However, Canadians need to understand where their money is going and what results and outcomes they are getting, They need to know for example, how the outcomes and results in the Yukon compare to the outcomes and results in Alberta, Quebec, Ontario and the maritime provinces so that there are some benchmarks by which Canadians can measure the performance of the health care system.
Those are some of my pet projects. As I said at the outset, we need to not go into deficit. We need to protect the tax cuts. We need to give money to the provinces for the CHST, but we need more transparency and accountability as we transfer huge amounts of money to the provinces and territories.