Mr. Speaker, I am very pleased to enter the debate on the budget, which we hope will be presented in the House some time in February.
I want to keep my comments to three issues. The first one is the debt. This is something that I find we all too often seem to forget about around this place. Everybody has an agenda here. They want to increase defence spending, medical health research and whatever.
Everybody has a lot of good ideas for spending, but the reality is that our debt is still substantial. The government has made substantial strides in reducing our debt. Indeed, from 1996-97 we have reduced it by $46.7 billion. The reality is that back in 1993 the debt was approaching the $600 billion mark. Today that debt stands at $536.5 billion, which is still very substantial.
We often refer to the relationship of the gross domestic product, that is, all the business activity going on in Canada at any one time, to the debt. That has dropped from 71% to 49.1%. Basically this means the capacity of the economy to sustain the debt, but even so, this is still a lot higher than that of our American counterpart.
I would like to talk briefly about why that is important. Because we have these debt obligations, there is a certain portion of our budget that is automatically dedicated to interest payments. That at one time was somewhere around $40 billion. When we talk about health care spending of an additional $15 billion, we can see that if we did not have this $40 billion expenditure over our heads, which we are committed to paying every year, we would have tremendous flexibility in our choices. It would be easier to make some of the choices that we are debating in the House today.
When I talk about fiscal capacity and this 49% figure, I am talking only about the federal debt. I have with me some figures from the OECD countries. They take in all public sector debt, whether it is the federal government, the provinces, or the municipalities, for that matter. It takes in the total debt related to our GDP, because after all there is only one taxpayer. Whether the taxpayer pays federal, provincial or municipal taxes, we have one person to work with. It is interesting to note those statistics, because while we talk about 49% of GDP relating to our debt, in fact if we take in all of the debt and look at the OECD countries, we see that Canada's debt ratio is well over 100% of our gross domestic product.
I will give some comparisons. The United States is 52%, so there is half of that GDP ratio in the United States compared to Canada. We still are significantly in debt. As a matter of fact, of those OECD countries, we have a better performance than only Japan, Italy and Belgium. All other countries in the OECD exceed Canada's ratio of debt to GDP.
The reality, and it is what I am suggesting for the budget coming up, is that we have to continue our commitment of paying down the debt. We have to resist the concept that we will have a balanced budget and simply spend all the money that comes in the door. We have to resist that. We have to park some of that money so that we allocate it to debt reduction. I would very much encourage the government to plan for that. We have been very fortunate in planning spending levels and surpluses and then exceeding them. We may well be entering a time when that is no longer the case.
I now would like to speak a little about health care, because of course that is very much on our minds. The Romanow commission report is before us. While Mr. Romanow has very many positive things to say, and I was very pleased to make a proposal to the Romanow commission myself, I must say that I was very disappointed in some aspects of Romanow report.
The disappointment I have is that the Romanow program basically builds on a structure which is inefficient, and that is the current public health care system.
I believe in the core values of a publicly funded health care system and the five principles of the Canada Health Act. Indeed, the proposals in the Romanow commission expand and clarify them. The Canada Health Council was very positive in moving the debate about health care spending away from politicians and putting it somewhere else where it would have some positive focus. We must demand accountability in health care.
The thing that disappointed me was this $15 billion bill being sent to the federal government. I am convinced that the $15 billion, if we decide it is a good thing to do, is already in the existing health care system. There is so much inefficiency within the existing system. Where, one might ask? We can talk about what health care workers do and do not do. We can talk about the structure of medical practices in the country which are expensive based on the actual resulting product.
Mr. Romanow's expenditure by the year 2004-05, disregarding Iceland as a comparison because Iceland's population is only about 247,000, would make Canada the third largest spender in the world on health care. We all know that we lag significantly on the quality of the health care that we are delivering so there is something wrong with this picture and it does not have to do with spending.
I would like to caution the government to resist spending more money on health care before we have the accountability right and we must also ask the provinces to clean up the health care system so that they become more efficient and effective.
Finally, I have my own little wish list about spending, and it seems somewhat inconsistent with my opening remarks about reducing deficit. I would like to visit one area which we do not talk about very much here and which has always bothered me and that is the guaranteed income supplement for seniors. The reason I got involved in this issue was that many years ago I used to do tax returns. People in my province of Ontario had to file tax returns to get a tax credit. At that time all of these people were coming to me to file their tax returns, which I never charged them for because their incomes were so low. Their income consisted of the old age pension and the guaranteed income supplement.
Today the guaranteed income supplement and the old age pension amount to about $998 a month, or $12,000 a year. If we think about that, that is a profound statement, that we actually have people in the country living on $12,000 a year. What is even more retrogressive is that our income tax system cuts in at around $7,400 or $7,500. So in other words, those people, a high percentage of whom are women, are also subject to taxation which is a terrible tragedy.
The United Way made a statement that something like 54% of all people over the age of 65 in the greater Toronto area are living below the poverty level. At this time of the year when we are talking about getting our families together, about kindness and the bonds that we share with each other, it would be appropriate to revisit the whole concept of the guaranteed income supplement to see if we could not find ways to put a little bit more in the pockets of these people.
These people do not stand out here on Parliament Hill with placards. They rarely write us or come into our offices and pound on the desk to say they have been mistreated. They are the silent poor of our society and yet I see them from time to time. It is a great tragedy that these people, through no fault of their own, have ended up in this situation. Often a spouse, a husband has died, his pension collapsing on his death and for whatever reason the wife did not work so she is not eligible for the Canada Pension Plan. She is required to live on a thousand dollars a month which cannot be done.
Talking about child poverty, we have put a lot of money in to the child tax credit, as well we should, to bring more life into those family units. We have children at risk, but we seem to be forgetting this other silent group of people at risk in our society.
My suggestions for the budget would be to raise the income cutoff as it hits taxation and, in addition, to raise our commitment under the guaranteed income supplement so we put more money into the hands of these people. This would allow them to live in dignity and self-respect as they wait out their years and would recognize the great commitment they have made to our country during that period of time as well.