Debates of Feb. 8th, 2002

Questions on the Order Paper

[Some hon. members]

Agreed.

The House resumed from February 7 consideration of the motion that Bill C-49, an act to implement certain provisions of the budget tabled in parliament on December 10, 2001, be read the second time and referred to a committee, and of the amendment.

Budget Implementation Act

[Paul Szabo, Liberal, Parliamentary Secretary to the Minister of Public Works and Government Services]

Mr. Speaker, I am pleased to participate in the debate on the budget implementation bill. We have had substantive interventions by members on all sides of the House about many of the elements of the budget.

Members have reminded us of the implications of September 11 and the importance of having a budget that would provide a security foundation for Canada. An amount of $6.5 billion has been earmarked for policing, intelligence, airline and airport safety and security, emergency preparedness and military deployment, all of which are emerging developments on a daily basis.

Much of the discussion has been with regard to income taxation, particularly tax cuts. Members will know that we already introduced a five year income tax plan of $100 billion. Additional cuts set in the five year plan would come into effect with this budget so that Canadians could see that each and every year their income tax burden would be going down.

It would include elements not only in reductions of rates of tax but would also include the benefits of the reindexation of the Income Tax Act. This means that various credits and other matters within the Income Tax Act would be indexed to inflation allowing Canadians to continue to reap the benefits of the difficult times we went through and the cutbacks that were necessary to ensure that we could get our fiscal house in order.

It is notable that Canada has experienced five years in a row of balanced budgets. We managed to pay down substantial amounts of debt. There is a commitment by the finance minister, who continues to provide projections for Canadians on a rolling basis, to again balance the budget for the next two years. That is good news for all Canadians.

Health continues to be the number one priority for Canadians. On Wednesday we received from the hon. Roy Romanow the interim report of the state of Canada's health care system. It is my hope that Canadians will comment and provide their input to that special commission on the important elements of the health care system. We need to address the delivering of the kind of health care system that Canadians have earned and deserve.

I encourage Canadians who are interested to contact their member of parliament to receive a copy of the Romanow report. There is a website where information can be requested and input can be provided directly over the Internet. That is very helpful for Canadians.

The budget included an infrastructure program of $2 billion. Infrastructure has always been an important part of renewing our economy. I creates jobs making sure that critical infrastructure is in place. It has benefited every region across the country and I was pleased that the item was still there.

One of the areas I want to talk about in a little more detail and which seems to come up often is the whole issue of the Canada pension plan. A number of members have raised the fact that notwithstanding cuts in income tax rates CPP premiums have gone up. We have reindexed various tax credits, increased child tax benefits which are not taxable, and we have put dollars into the hands of Canadian families each and every month to assist in dealing with the exceptional cost of raising healthy, well adjusted children in Canada. I want to amplify a bit as to why Canada pension plan premiums have increased.

First, people have suggested the Canada pension plan system is not financially stable. Back in 1997 the Canada pension plan system had some big choices to make. At the time we had five workers for every one retiree. Each of those retirees was receiving about $8 for every $1 they put in. That was sustainable at that point. As our society ages, as the baby boomers move through the system, they will start to retire. We will see that five workers for every one pensioner reduced down to about three workers for each pensioner. That means that more support has to be put into the Canada pension plan system to ensure that Canadians will have the security of having their pension benefits when they retire.

Canadians should know that the Canada pension plan system is under the auspices of not just by the federal government. The provincial governments are also responsible for the planning and strategic operation of the pension system. All the benefits and changes, whether it be the premiums, et cetera, have to be approved on the basis of the agreements among the provinces and the federal government. Canadians should know that all our elected leaders across the country, representing all regional national interests, work to ensure the Canada pension plan system remains on a stable footing.

I also point out that there seems to be a lack of knowledge on behalf of some as to what exactly the Canada pension plan system does. Not only will we receive the obvious pension retirement benefits when we reach retirement age, we will also have a number of other elements which are quite costly but I think are important to Canadians.

For instance, should a pensioner pass on there are survivor benefits so a spouse can receive additional support. There is a death benefit under the Canadian pension plan system to the estate of the deceased person. Also a death benefit is payable to any dependent children, which also recognizes the benefit earned in the plan.

Probably the most important element of non-pension benefits of the Canada pension plan, which is quite expensive but quite valuable to Canadians, is the disability benefit. If self-employed people do not have a long term or a short term disability plan but have earned income and paid into the Canada pension plan like any other working Canadian, a disability plan provides benefits to the disabled workers which would be more than they would ultimately get if they were retired and receiving a pension. This is an important security or underpinning for Canadians.

Many Canadians are injured on the job or develop long term illnesses or diseases and are unable to earn incomes to take care of their families. This element of the Canada pension plan system enables them to have that protection, but it is quite expensive. The number of Canadians drawing on the pension disability benefits continues to grow but it is important to sustain.

Those members who have raised the point that while we have had tax reductions in a number of ways, those are offset to some extent by Canada pension plan premium increases are quite correct. However it should be clear to all now that Canada pension plan premium increases are there to ensure that not only will Canadians continue to enjoy the generous benefits out of the Canada pension plan, but that they will also have the protection of long term disability which cares for the families of many Canadians.

[Grant McNally, Canadian Alliance, Dewdney—Alouette, BC]

Mr. Speaker, it is a pleasure to join the debate on the budget implementation bill.

I will begin by acknowledging my Liberal colleague who just spoke. I think this is the first time I have ever heard a Liberal member acknowledge that CPP increases somewhat knock into the tax cuts that have been given by the government. I appreciate that candor.

At the same time, I want to talk about the legacy of the Liberal government during its reign from 1993 to today. The government has done some good things in terms of tax cuts, but it has not been enough. As the Liberal member just mentioned, the cuts taken away on the one hand have been increased with CPP contributions in other areas. The overall impact has not had the maximum effect of what real, substantial tax cuts would do in stimulating our economy.

I do want to talk about the Liberal government's missed opportunities. Throughout the early part of the Liberal government's term in power, it had to make some cuts. In recent years the country has had unprecedented growth. The Liberal government has missed the opportunities to plan for the future. It thought of as many ways as it could to spend taxpayer dollars, and I will reflect on some of that.

The growth that occurred in our economy previous to the current recession we are now in, somewhat related to September 11 but other factors as well, was in spite of the government not because of it. For years we have heard the Liberals say that the policies of the government have made things happen economically in the country.

Seeing as I have the floor, might I take this opportunity to perhaps move a motion, seconded by my colleague for Elk Island, that for the rest of this term in parliament we make all private members' bills votable? Would there be consent for that motion?

[The Deputy Speaker]

Certainly the member is entitled to ask for consent. Is there consent?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[Grant McNally, Canadian Alliance, Dewdney—Alouette, BC]

Mr. Speaker, I appreciate the opportunity to raise that and hope my colleagues will be able to hear the riveting speech on which I will continue to embark because it has to do with the missed opportunities of the Liberals during their term. We just heard numerous stories about government mismanagement, and I want to remind people of the legacy of the government.

When I was a new member, first elected in 1997, I remember a small story that started up about a Liberal fundraiser named Pierre Corbeil from Quebec. What happened with this Liberal fundraiser, and perhaps with others as well? He was convicted of influence peddling. He had lists of individuals in Quebec who were receiving government grants. Lo and behold he would knock on their doors during an election campaign, point out they were on the list for a grant and would ask for some cash for the Liberal Party of Canada.

[An hon. member]

Shakedown.

[Grant McNally, Canadian Alliance, Dewdney—Alouette, BC]

Shakedown, as the Liberal member says. It was a shakedown by a Liberal fundraiser in Quebec and he was convicted. I might hazard a guess that this is the tip of the iceberg of the kinds of things that go on behind the scenes here.

We see the facade of the government when it says it is doing this or that. However another level is operating of scandal and mismanagement with the Liberal government. I make these assertions of fact because in the end how can Canadians trust the government to manage their dollars when these kinds of things go on? How can Canadians trust the government to manage the budget of the country when a Liberal fundraiser is convicted of influence peddling in the province of Quebec. As the Liberal member said, shaking down individuals for donations to the Liberal Party of Canada before they would get their grant?

Might I remind people that a government grant is taxpayer dollars, the hard earned cash that Canadians remit to the government. That money is supposed to be used wisely for services that Canadians want. That is the attitude of government members. I am sure they are just as embarrassed by this as much as members of the opposition are.

However it does not stop there. Not only was this Liberal Party fundraiser convicted of influence peddling, but there were other debacles such as the HRDC billion dollar boondoggle scandal. We are all well aware that grants were handed out, taxpayer dollars, often when applications had not been filed. Paperwork was done wrong. Grants went to Liberal ridings in disproportionate amounts. Part of the defence in the whole argument was for ministers to draw opposition members into the web. They said we were writing letters on behalf of programs also. This is part of their strategy. They draw in others as a defence mechanism to justify the mismanagement of taxpayer dollars. That is just not right.

Of course that boondoggle scandal led to the Shawinigate case. More police investigations have taken place in the Prime Minister's riding than perhaps anywhere else in the country. It is unbelievable. The Prime Minister admitted he had contacted an individual at the Business Development Bank on behalf of a constituent. He said that he was doing his job.

I guess his friend, Alfonso Gagliano, the former minister of public works, was just doing his job too when he intervened and called the head of a crown corporation on behalf a friend. Well, he is no longer with us for who knows what reason. Perhaps it could be related to that incident.

The fact is this kind of scandalous mismanagement, this kind of corruption which goes on behind the scenes on the government side is an embarrassment to the country. It is an embarrassment to members on this side and I know it is an embarrassment to many of my colleagues on the Liberal benches, and it is wearing thin.

I am running out of time and I have five more pages of information having to do with how the government has missed opportunities over and over again and how it has betrayed the trust of Canadians in ways that are unspeakable. These occurrences are too common. These are taxpayer dollars given by people to the government for it to manage.

I also mention the parallel grant process. This story broke during the 2000 election. Grants that were given out in Quebec were put through a parallel process of approval through the Quebec Liberal Party. It was the Quebec branch of the federal Liberal Party of Canada. Who could imagine such a thing? It is unbelievable. It relates to the Pierre Corbeil incident, the convicted Liberal fundraiser from Quebec.

Those kinds of things go on behind the scenes. It is because of those kinds of actions that during this debate on the budget I propose the fundamental thesis that this governing group of Liberals cannot be trusted with taxpayers' dollars. It is time for them to be thrown out of office because of their scandalous record of mismanagement.

[Gerry Ritz, Canadian Alliance, Battlefords—Lloydminster, SK]

Mr. Speaker, there is a lot of rhetoric from the Liberal side especially about balanced budgets for the last five years. If Canadians did the math they would realize that these guys have been in power for seven, going on eight years now. The first year was a little tough. A big deficit was brought forward and the Liberals had to deal with that, although they did it in certain ways we did not agree with. Then they kind of missed a few years. Probably the reason was there was no budget. A lot of us missed the chance to harangue them last year when they did not bring one down.

Since that time the loonie has basically tanked. There are a couple of quotes by the new Liberal member, the member for Richmond, which I would like to share with folks. On December 11 just after the budget came down he talked about the Liberals strangling the Canadian economy. That is his quote. He also talked about condemning Canada to a bargain basement dollar. I wonder if he still shares those ideals with folks now that he sits in that caucus. It would be very interesting to be involved in some of their caucus discussions to see if that is still the rule.

In balancing the budget, which the Liberals claim they have done, a few things stand out as glaring errors or omissions in the numbers that have kind of been fudged to make that happen. An EI surplus of almost $40 billion has disappeared. There is no money in that account. It went into general revenues. Some $30 billion has grown legs and walked away from the civil service pension plan. In that same timeframe, $25 billion has been pulled out of health care and social transfers to the provinces. Add that up and there is $95 billion of funny money creative accounting to help balance the budget.

We always have to pay the piper. Somewhere down the line we will have to put some of that money back in. Where is it going to come from? We are barely squeaking by now. We saw a surplus this year of $1.5 billion. That is not going to cover a $95 billion asset that will have to be put back at some point in the future.

In its political spin, the government branded it as a security budget. Canadians do not feel very secure with the economy in the tank like it is. The government branded it as a security budget, yet just days before the budget came down, the auditor general in her report talked about $16.5 billion of wasted, mismanaged spending in various government departments.

The auditor general pointed out that defence alone needed $2 billion to get ratcheted back up to a standard that would not leave us limping behind places like Luxembourg and other world powers such as that. The auditor general called for $2 billion. What did the government deliver? Two hundred million dollars.

It is a pittance compared to what the armed forces need, especially now that we have sent them off to Afghanistan in funny coloured uniforms, with half of their equipment stuck in Germany which cannot find its way to Afghanistan. They are borrowing rations from the Americans. They are rationing water. We are one of the richest countries in the world when it comes to clean water and our troops over there have to ration it because we cannot get their supplies to them. The government has absolutely ridiculous accounting practices. Our troops do not have stoves and they are bumming candles from the Americans to heat their borrowed food.

They have rigged up latrines out of fuel barrels, planks and tarps. It is a coed army. I am sure some of the ladies are doing an exemplary job by simply being over there. Our troops are limping along because the Liberals will not supply them with what they need to get the job done in a way which lets them hold their heads high. Our troops are doing a tremendous job.

In talking about government priorities, one of the major priorities over the last number of years has been the long gun registry. The Liberals have put between $650 million and $800 million into that bogus program, depending on whose numbers one looks at, and only $200 million into the military. They are targeting the wrong folks. Let us get the money to where it is needed. If we are going to fight a war on terrorism, let us target the terrorists, not the farmers and duck hunters.

As I said, the auditor general pointed out there is over $16.5 billion in waste and mismanagement across this great country. That is a huge statement. Not one thin dime of that was addressed in the budget. It all disappeared. There is no consensus or drive by the government to find out where that money went and whether we are getting a bang for our taxpayer dollar. The auditor general says no, that it is very questionable. Canadians are saying it is very questionable.

There is a lot of talk about the Minister of Finance forwarding the big tax program he talked about just before the fall 2000 election. People should look at their January paycheques. I looked at mine and my net pay is down. No one is going to cry for a member of parliament; we are overpaid and underworked. My paycheque is down so that tells me that all the folks whom I represent are facing the same dilemma.

With regard to the Canada pension plan, there is a 14% increase to maintain a program which has been gutted by lending money to provinces that have not paid it back.

There are huge unfunded liabilities. These are huge dollars. We are mortgaging our future on to the next generation and the generation after that. It has to stop.

When I first became involved with the Reform Party we had a saying that if we wanted to stop digging a hole, the first thing to do was to quit digging. We are digging ourselves further and further into debt. The creative accounting we see in budget after budget does nothing to address that huge hole which has been created.

There are a couple of decent things in the budget when it comes to my riding. The government announced that it is going to target fetal alcohol syndrome. That is good news and is long overdue. Let us get it done, but let us go to the source. The budget is long on dollars but short on detail. Apparently $60 million has been allocated for that but how is the government going to do it? How is it going to make the program work where it needs to work? It does not say in the budget.

The finance minister was in North Battleford the week before we came back to this place. He was harangued by the crowd about the government's lack of vision for agriculture. That is our bread and butter out there. It is everybody's bread and butter across the country. Anybody who enjoys eating has to thank a farmer somewhere along the way.

Yesterday was food freedom day. Yet it is only nine days into the year that producers themselves are paid for their hard work and their sweat equity and all the overhead costs they incur to give us the safest, most secure food supply in the world. It is just unfair.

The budget showed what the government thinks about agriculture. There is one line which talks about the long term sustainability of agriculture. There is no idea of how to do it and no dollars are allocated to it. There is no program, no plan and no strategy. There is zero, absolutely nothing.

The agriculture minister cried about the AIDA program. He said it was great, that it was going to be the answer and would do wonderful things. It was a huge disappointment.

The only thing that angers people in my part of the world more than the long gun registry is the way the government treats agriculture. A Liberal could not get elected out there. If they tied pork chops around their necks, the dogs would not even play with them. That is how bad it has become out there. People do not trust those folks at all and that is their absolute right because they see that these programs are long on rhetoric and short on substance.

The agriculture minister said that they will redo the safety nets. I started farming in 1972. I have heard that line again and again and they are still a dismal failure. There is no way that people out there are ever going to buy into that type of rhetoric.

Huge dollars, $2 billion, have been allocated to infrastructure. That is great news. The problem is the asterisk beside the figure in the budget and the little note at the bottom of the page which says it is only going to apply if there is a surplus and money to do it. Again, it is long on rhetoric and short on planning.

In the past year my own community of North Battleford suffered a severe blow with a water problem. We applied to the government for emergency funding. There is a program in place to build a new sewage facility. We cannot trigger the money to speed that up and get us over the hump when it comes to safe infrastructure, water and sewers and so on across the country. This is another huge glaring deficit.

Highway 51 is in my riding. A group in my riding formed a committee. Saskatchewan has seatbelt rules and they are a necessity for anyone who drives down that highway. People would be thrown out of their trucks if they were not wearing their seatbelts. That is how bad it has become. Small vehicles cannot drive down that road because they would disappear into the pot holes. We would drive right over top of them. Volkswagens are good because they have a nice and smooth curved roof.

It is absolutely ridiculous that these guys cannot understand that Canadians are finally catching on to their unfunded, undelivered promises. The budget is a glaring error of omission. It is long on rhetoric and short on substance.

[Bev Desjarlais, NDP, Churchill, MB]

Mr. Speaker, I am pleased to have the opportunity to speak to Bill C-49. It is interesting that the bill is entitled an act to implement certain provisions of the budget tabled in parliament on December 10. I think it is important to mention that in view of September 11 and everything that has happened as a result of September 11, the government has spoken numerous times about making sure airports were secure in Canada. Shortly after we got back in September, the transport committee began holding meetings on airport security and a lot of things were brought forward.

In the government's news release on the budget implementation bill the number one item listed was to establish the Canadian air transport security authority which would deliver improved security at Canadian airports and on board flights. The second item was to implement the air traveller's security charge as of April 1, 2002, to fund the air security enhancements.

I suggest that when we look at the budget implementation bill, which contains about 110 pages, there are over 70 pages relating to the airport security agency and the collecting of the fee.

Nowhere in the bill does it say for sure that we will have improved training for airport security workers or that RCMP officers will be on flights when necessary. It also does not ensure that training will be improved. We see a lot of innuendo. The government has the audacity to say that it will deliver improved security at Canadians airports and then dedicates over 70 pages to the security agency, which, without a doubt, will be made up of Liberal appointees getting paid a darn fine salary for sitting on that agency with a couple of appointees by the airport authorities, the airport authorities that have been appointed by a Liberal government. Quite frankly that is no change to what we have. That is the status quo in my view as of September 11.

The airlines looked after airport security workers prior to September 11 and the security was contracted out to the lowest bidder. I do not blame airport security workers for September 11, not for a second. They were working under a set of rules that were in place and, for the most part, did their job as best they could.

Through the numerous witnesses we heard in the transport committee meetings, everyone maintained that there had to be improved working conditions, improved wages and improved training for airport security services. Everyone also maintained that there had to be a cohesive security package involved.

We should not have the RCMP doing one section, provincial police doing another section, security agents doing another section and possibly in another area some other security group.

The committee also felt that having airport authorities take over security was not the best route to go. Airport authorities also operate on a bottom line. Anybody who would suggest that one airport authority is not competing against another just has to look at Toronto and Hamilton where they are competing for the business. It is because those people who are on those authorities are being paid a darn fine salary. It is another level of management that has been put there to give jobs to a good many Liberals, although I am sure there is one token person who is not a Liberal, but, quite frankly, I find it appalling.

Something that is as important as the security of our nation and so important to improving the stability and confidence in the airline industry, and the government's approach is to let the airport authorities look after it again. The airport authorities can subcontract it out or the agency can subcontract to the airport authority which can subcontract it out to the lowest bidder. There is no guarantee.

Why on earth do we have security under the auspices of Transport Canada? What is wrong with this picture? We have a justice department and we have a solicitor general's department. Are they not the specialists in security and justice? The solicitor general's department should be the security specialist and should be in charge of security at our airports, our ports and at all federal installations.

How do hon. members feel about the Minister of Natural Resources being in charge of our health care or the minister of agriculture being in charge of communications? Something is wrong with this picture. Why on earth do we not have security under the solicitor general's department? Why are we adding another level of management that will be taking huge pay and not doing any better in providing security at our airports?

I am extremely disappointed that the government, as far as I am concerned, has exploited September 11. There is not a doubt in my mind. The finance minister and the cabinet saw another way of getting a little bit more money into general revenue coffers so they put in a $12 security tax. I need to clarify that. It is $11.22 security tax and on top of that will be the GST, which makes it $12.

Certainly, on something as important as airport security, Canadians should not be charged the GST. That rates up there with certain health care products and certain educational needs. It is just one more way of getting more money. The government has gone beyond being a government for the people, of providing services to Canadians, of providing good social policy and a good plan for this country. All it is out for now is to make a buck wherever it can get it out of the pockets of Canadians.

I am tired of hearing how much money we are saving on income tax. People may be saving $27 or $100 on their income tax each year but they are spending $200 to $300 in additional charges on things like NavCan fees, fees on some toll roads, increased health costs because so much has been cut, and increased education costs because there is no longer any fairness or equal distribution of dollars among the provinces. The government has less and less responsibility to put money back into the provinces for the needs of Canadians.

It is being set up as a place where the government can employ a few more people and give them a good wage to make it look good. The government wants the finance minister to make it look good because it has all this money sitting there. Of course it has the money. It is taking it out of the pockets of Canadians every day and not giving them back any services. Then they have to pay for those services again.

How could the Liberal government not have money? It has cut EI benefits. The benefits are so insufficient now that only one-third of unemployed people can collect EI. Workers in northern communities, where the cost of living is tremendously greater than other areas, have the same maximum earnings limit for collecting EI as everybody else.

We have a situation where a mine is closing in Leaf Rapids. A good number of workers have spent 20 some years in the north. Now they will try to collect EI. They will get their severance pay and will not be able to collect EI during the time they collect severance pay. They have to pay income tax on their severance pay. At a time when one is down an out, that is kind of annoying. If they have worked part of the year they have already reached that maximum allocation of money they earned and then they cannot collect EI. They go for months with no money or they have to go on welfare. They want to be an active part of society and work, but they have to go on welfare after working for years. Just because of cuts by the government, they have to go on welfare.

Obviously there is not near enough time to comment on everything that is or is not in the budget implementation bill screening but I do I want to mention one other aspect regarding the screening.

The equipment that the Government of Canada purchased for the screening of people going through airports will be turned over to the new agency which will then lease it out to the airport authorities, that will then increase the cost of airport fees to offset the costs of increased rents and fees for security equipment. It sounds like an awful lot of loan sharking on behalf of the Liberal government.

[James Rajotte, Canadian Alliance, Edmonton Southwest, AB]

Mr. Speaker, I rise today to speak to Bill C-49 which will implement some of the measures in the budget of December 2001. It is always a pleasure to speak in the House of Commons to such a large and attentive audience. I rarely have an audience like this so it is a real pleasure.

I was speaking to our House leader's assistant, David Prest, earlier today who really put the government's financial record into perspective for me. David and his wife, Carolyne Campbell, had a baby girl on Wednesday at the Queensway Carleton Hospital. They named her Amelia Carolyne Victoria. I asked David who she looked like and he said that he could not quite tell yet, but that the baby reminded him of the Liberal government. I asked him what he meant by that. He said that it was because she has a ferocious appetite at one end and no responsibility at the other.

The budget was a missed opportunity. It was an opportunity to address the security needs in our nation and to put us back on financial track but what does it actually do? If we look at what it does not do, we see that there were no new debt payments resulting from the budget. It is inexcusable, particularly to people in my generation but also the generations that follow, for the government not keep its fiscal house in order and pay down the debt so that we can have a future.

We see no new taxes in the budget. The government has been bragging a lot about the fact that it has held taxes to the same level since October 2000, just before the last election, and that it will not go back on its word, but that is inexcusable, especially considering that the finance committee's report recommended tax reductions, particularly on capital. Reducing the tax on capital would allow more investment in Canada and would help address the economic slowdown we currently are experiencing.

The fact is, the government actually raised taxes. As the previous speaker indicated, it has raised taxes in the bill for airport security: $24 for a return trip. It is inexcusable that the government is forcing passengers to pay such a high cost for airport security. We have to consider it in relation to all the other taxes that are charged currently.

The base cost of a return ticket between Edmonton and Calgary is currently $100. How much tax is added on to that $100 ticket? With this airport security charge, it will now be $86 in taxes on a $100 ticket. Then we wonder why people are flying less and less each year. It is not only because of the situation caused with the increased security and the concerns about what happened on September 11, it is because we are taxing airline travel too much and it is hurting our air industry. I believe seven or eight airlines have collapsed or merged since the Liberal government took over. That simply is unacceptable.

I had the opportunity of having lunch with someone from the Canadian Restaurant and Foodservices Association who said that payroll taxes were severely hurting his businesses. Payroll taxes, employment insurance and Canada pension plan, which have been increased, have severely hurt middle and low income earners to work their way up through society and pay for their families.

The EI surplus now is approximately $36 billion, which is unacceptable. As the auditor general has pointed out, a $15 billion surplus is more than enough to pay for any foreseeable economic downturn, including the one we are in, even if it worsens.

There is no reduction in program spending in any area. It was interesting to hear the finance minister earlier on in the year indicate that he favoured some reductions in program spending and that he would target and not move spending from lower priority areas to higher priority areas, especially given the events of September 11 and the need for increased spending for the RCMP, CSIS and defence.

However there was not one dollar in reductions in spending at all. There are many areas that have come to light, especially recently, such as Technology Partnerships Canada through Industry Canada, the Canada Foundation for Innovation, and a lot of the R and D investment. If times are good and we are sitting in a very high surplus position maybe we should consider investing in these areas.

However when times are tough, when the economy is in a downturn and spending is needed for other areas, surely that is the time when it is moved from these lower priority areas to higher priority areas.

If we look at other additional spending investments, at a time when our troops are overseas in Afghanistan we are spending more money on the Canadian Broadcasting Corporation and the Canadian television fund. That simply does not recognize the priorities that Canadians want the government to have. They want more accountability and transparency in how their taxpayer dollars are used.

An older gentleman and a good friend of mine named Keith Cumming from my riding refers to this point all the time. He says we need to look at taxpayer funds as funds in trust.

Often when ministers rise to speak about spending they will often say their departments are spending the government's money on this or that. The fact is that it is not the government's money. The fact is that it is taxpayers money.

We do not own this money. Parliament is supposed to oversee this money and disburse it according to the priorities given to us by Canadians, but it is not our money. It should be considered taxpayer funds in trust.

This is an opportunity to address what are obviously the two most serious issues: the economic downturn and the need for increased security spending. The government failed in that aspect.

There has been a lot of discussion recently about whether or not the opposition supports our troops. Of course we unequivocally support our troops. The fact is it is our duty to stand in the House to ask on behalf of them and all Canadians that they be properly equipped.

When we send them into a situation where the rules of engagement are that they could very well face serious fire or serious resistance, we have to ensure that they are properly equipped. We have a situation where the equipment they are using will become obsolete over a number of years and where billions of dollars will be required in investment. Those billions of dollars are not being invested now. The fact is that the government will not be investing properly in equipping our troops. That is unacceptable.

The first priority of a nation and of a government has to be national security not only in the external arena but in the internal arena as well. Frankly those are areas where the government is simply not fulfilling its mission.

New defence spending of $1.2 billion is simply not enough. The Conference of Defence Associations, the Canadian Alliance and others have said that at least $1 billion to $2 billion each year is needed to address the shortfall in defence spending.

It was interesting in 1994 that defence was hit the hardest in the government's first budget. We are feeling the repercussions now. The decisions made then are unfortunately reaping the dividends of not preparing our troops and of not updating their equipment enough. The fact that the Sea King helicopters have not been replaced and will likely not be replaced until at least 2005 or even 2015 is simply unacceptable.

The budget was an opportunity to address economic fundamentals. One of the concerns Canadians in my riding raise with me is the Canadian dollar. They find it absolutely unacceptable that we allow a 62 cent or 63 cent dollar to exist over a long term.

If we look at what the dollar has done under the Liberals we see that it has been on a steady decline. When the Prime Minister was in opposition he complained about the Conservative government at that time having an 80 cent dollar. An 80 cent dollar is much better for us because the dollar is a symptom of the country's overall economic health.

The dollar signifies that our economic fundamentals are wrong, our productivity is too low, our debt levels are too high, our program spending is too high, our taxes are too high and thus investment is not coming in. It was released this year that Canadians are investing more outside Canada than inside Canada. It is unacceptable for a first class world nation to be in that economic situation.

We are the most blessed nation in terms of our natural resources. Yet we have a situation where the government is so mismanaging the financial aspects that we are becoming a second tier economic power. That is simply unacceptable and that is why I urge all members of the House to oppose the bill.

[Loyola Hearn, Progressive Conservative, St. John's West, NL]

Mr. Speaker, it is again with pleasure that I stand to say a few words in relation to the bill and to comment on the budget such as it was.

When I read the budget of the few months ago sometimes I think of my old days as a schoolteacher. I often say that if some of my students passed in an assignment that was so incomplete and contained so little about the subject I would send it back to them.

We talk about a six month hoist. I think we should talk about just sending it back. We should forget about the period of time and demand that the government produce a real document. Having said that, we have to deal with what is before us.

A previous speaker from the NDP talked about the government squeezing every cent out of the Canadian public. It is so true. Poorer people are being squeezed left, right and centre.

It reminds me of the old story of the five parties in the House having a social together. Five flies were flying around and happened to pitch into each glass. The four parties on this side automatically threw away their drinks. The Liberal member took the fly, squeezed the beer out of it back into his glass and drank the works.

That illustrates the way the government operates. It is trying to grab every possible ounce, every possible cent it can out of the Canadian public.

I will mention a couple of examples. One is the $24 tax on air travel. That might sound insignificant to most members. Many of us travel to the far reaches of the country and the cost of our airfare is horrendous. That is another issue.

To fly return from Newfoundland to Ottawa is anywhere from $1,800 to $2,400 for a return trip. People in British Columbia are paying just as much or more. Some people will say that $24 on $2,400 is only 1% , big deal. What about the shorter flights taken every day by people who have to use air travel to get to work or small business people who have to use air travel to get to meetings across the country where the flights are perhaps a little over $100? Now we are looking at 24% extra. What does that do to the people who travel?

What does it do to the budget of students who are trying to get back and forth to colleges and universities? Students have not been helped in any way by the budget. A country such as ours should depend on youth because they are our future. We invest less in our main resource, our greatest resource, than we do in anything else. We completely ignore our youth just as I would say we ignore our aged.

There is nothing in the budget to help seniors. What is happening as all this unfolds? As our interest rates drop, seniors, many of whom are on fixed incomes, are surviving on their little investments. They have seen the return on their investments diminish to the point where they have absolutely no income. What has been done to offset that? Nothing. Of course that is the operable word with the government.

The EI fund with its $30 billion surplus is an insult to working people and small businesses. Did the government take into consideration suggestions such as a $3,000 exemption that would help many students who work during the summer and see a lot of their money being deducted to pay for EI premiums which they never draw back? No. It certainly was not even considered.

What about small business people who hire a lot of part time employees? I am thinking particularly of those in the restaurant, bar and hotel industry. Are these people who earn very little exempt? Do they have a basic exemption? No. That was not considered. Why? It would help a lot of people help themselves and the government has shown that it does not care.

When I talk about what is in it perhaps I should also talk about a couple of positive points. Let us not be totally negative because we get accused of doing nothing except criticizing the government. I had problems finding anything positive. One interesting one was in relation to a new infrastucture fund of $2 billion that would be set aside to deal with special projects such as water, sewer and environmental projects which could not be handled under ordinary infrastructure funding.

It is a bit ironic but a couple of weeks before the budget came down I spoke at length one day on the same topic. Several of the ministers over there responded to me when I asked questions about funding for the cleanup of St. John's Harbour, Halifax Harbour or Victoria Harbour. It does not matter which one. They are all in the same boat, pardon the pun.

The answer was that the government gave infrastructure funds to the provinces and they could do whatever they want. If they did not use them to clean up the harbours, that was tough. We know that the one-third, one-third, one-third cash shared municipal, provincial and federal funding is not enough to deal with the pressures on provinces to deal with water and sewer concerns throughout the many towns and villages within the different provinces.

That money could not be used for major projects. I suggested at the time a special fund be put in place to deal with major projects such as harbour cleanup.

Apparently the minister was listening to me. The former minister of industry who represented our province had been saying to use the old money. He did not have the creative mind to come with the possibility of a new fund. Anyway the new fund is there. Will it be delivered fairly and squarely? We thought so because an arm's length organization was to deliver it. Now we see the minister will be responsible. The government will be responsible. It is to handle the fund directly.

Will the funds within that fund be delivered to the different provinces fairly? We do not know. We hope there will not be political manipulation. We hope the funds will be used for what they were originally intended to do and that a place like St. John's will benefit from that fund to clean up a harbour, which will mean so much to the port, to the tourism of the province and so on.

Another interesting item in the budget in relation to infrastucture was the $100 billion cut from marine infrastructure. There was also $10 billion or so to improve the coast guard. What is ironic about that is that it happened after a damning report was tabled in parliament regarding the cuts that had taken place in the Department of Fisheries and Oceans.

The Standing Committee on Fisheries and Oceans has done a phenomenal job. I recognize people from all sides of the House who sit on that committee. They have forced the government to make a move on dealing with the horrendous state of affairs within the Department of Fisheries and Oceans simply by bringing into the open what has been happening to the marine infrastucture and the coast guard.

Some good things were included because of the pressure of members on this side of the House. It has nothing to do with members on the other side. What is in the budget is one thing. What is not in it is interesting.

I mentioned there was nothing for seniors, nothing for our youth and absolutely nothing for our homeless. Luckily this is a very mild winter in this region. Ordinarily that is not the case. Quite often as we walk to work on cold mornings when it is 40 below outside we see young people, middle aged and even in some cases older people huddled in corners where they have spent the night. What is the government doing for them? What is in the budget? Not a word. What is it doing for the fishery? The word fish or fishery is not included in the budget.

What is in it? Very little is in it. What is not in it? A tremendous amount is not in it. I could go on for a week about the issue. I hope if we can keep this going we will get another chance. I am sure others want to thank the government for all it has done for all of us in this great country.

[John Duncan, Canadian Alliance, Vancouver Island North, BC]

Mr. Speaker, the budget the government presented last December 10 was a great disappointment to many of us. We were expecting the government to do something about the fundamentals. However we saw no provision for scheduled debt reduction, no measures to stimulate the economy, no tax relief and no substantive or significant increases to medicare and the things people in Canada value so much.

The Canadian dollar was at 78 cents U.S. or thereabouts when the government came in. It is now sitting somewhere around 62 cents. People are not calling it a dollar. They are calling it a dollarette. We used to make comparisons on a North American context and compare ourselves in the worst case with the Mexican peso. Now we cannot even do that because Mexico has become a much friendlier place than Canada for investment. The Mexican peso has increased in terms of double digits in relation to the U.S. dollar while we have gone in the other direction. It would be flattering to be able to compare ourselves with the Mexican peso but we cannot make that claim.

The largest symptom of what is going on is that Canadians have chosen not to invest in Canada. The world has become a much more flexible place. Canadians will no longer be held hostage in their own country in terms of how they choose to make investments, and money is very fluid as we all know.

We had a longstanding restraint which was counterproductive. We were only allowed to put 10% of our RSP investment into non-Canadian investments. That has recently been increased although it is still not a free for all. There is still some constraint. However even with the constraint Canadians are choosing more and more to invest outside their country. We are investing more outside our country than inside and there is a reason. The expectation is that the Canadian dollar will continue to do poorly against its international comparison which is primarily the U.S. dollar. Until we turn that around it will become a self fulfilling prophecy.

The only way to turn this around is to change the fundamentals. However the government has chosen not to address the fundamentals in the budget at a time when we need to bolster the credibility of the government in the public eye. We all know that after September 11 a lot of anxiety was directed toward how the government would address a lot of things. Without trade Canada's prosperity is jeopardized. Some 87% of our trade is with our U.S. partner. What we did in the budget to address our security and other concerns had obvious implications for our trade.

I will pose a rhetorical question. What has happened to Canada's pride? Because of the unique circumstances and timing of the budget the government did not address the things on which people were placing the most personal emphasis. We ended up with the Department of National Defence getting an increase to pay for Operation Apollo, our commitment in Afghanistan, and nothing to address the rust out and other major considerations we all know are so necessary to upgrade the armed forces and give our personnel what they deserve.

Last year I went with seven or eight members of parliament to Fort Lewis, Washington to watch Canadian army reserves from British Columbia participate in a training exercise. Since the army base in Chilliwack, B.C. is closed it is a way for them to train cost effectively. It was an eye opener. First, there are more U.S. military personnel stationed at Fort Lewis than there are Canadian personnel in the entire Canadian armed forces.

Second, while we were there we were given presentations on the Canadian Clothe the Soldier Project. I saw state of the art, technically developed and internationally acclaimed clothing, body armour, boots and other instruments that would be the envy of many of our NATO partners and other countries around the world.

It was with great concern that I discovered yes, we had seen all the prototypes and yes, we had spent $300 million on the program, but when it came to deploying our troops we did not have what was required. That was the impression I was left with.

I have made this statement but I will repeat it. The budget did nothing to address the fact that in its early response to September 11 Canada, the major trading partner of the U.S., was displaced as a friend of the United States by the U.K. We have not got that status back because we have not put our money where our mouth is.

We need to do more, spend more and have a firmer policy on border security. We need an immigration and refugee determination process that places Canadian security concerns first. We need to address our lack of military spending. We have been criticized across the board by Lord Robertson of NATO.

The Bush budget of last week added $46 billion to the U.S. military. If we were to do that on an equivalent basis it would be $4.6 billion. It shows how silly our commitment looks. We need an enhanced set of personnel resources on all fronts. This includes our park wardens, customs officers and every other front line service.

[Jay Hill, Canadian Alliance, Prince George—Peace River, BC]

Mr. Speaker, I did not intend to rise and address the budget implementation act this afternoon. However I saw how things unfolded during the day. Since I suspect all MPs will be going back to their ridings for the upcoming break week I felt compelled to get up and add a few words to the issue.

I have been a member of parliament for over eight years. The budget brought down on December 10, almost two months ago today, was the greatest disappointment I have witnessed in my lifetime as an elected member of parliament. I think I speak for the vast majority of Canadians who were led to believe by the Liberal government to expect much more than was delivered in December.

As a number of colleagues have pointed out during the debate, even those from the government benches, there were extenuating circumstances. It has been about five months since the horrible tragedy of September 11. The ripple effects of the dastardly terrorist attacks on the United States of America have been felt not only in the United States but around the world and in Canada in particular. All of us in this place and Canadians from coast to coast recognize that the ripple effects of the attacks are felt in meaningful ways in our everyday society and should have been reflected in the budget the government brought down. I think most Canadians were prepared to be quite understanding about that when looking at the budget.

However what has come to light over the last month or two since we have been actively involved in the war on terrorism, specifically the campaign in Afghanistan, has been how ill prepared the government and our country have been. The once extremely capable Canadian armed forces are but a shadow of what they were in the past. I mean this in terms of equipment and tools to do the job. This is because of nothing more than the Liberal government's misplaced spending priorities. It is that simple.

When the government would rather throw money away on make believe job programs, ill thought through grant programs, and fountains for the Prime Minister's riding rather than the equipment needed by our men and women in the armed forces there is something seriously wrong with our country and our government. That is what has transpired.

Speaking for the constituents of Prince George--Peace River I can tell members that in the real world, outside the Ottawa bubble and the House of Commons, Canadians understand this very clearly. I have heard from a number of my constituents about the issue.

Canadians are reading about our young men and women overseas in Afghanistan having to go cap in hand to the Americans to ask for food rations because they do not have stoves to heat their own food. Our soldiers are dressed in green camouflage uniforms that only allow them to conduct operations safely at night because they are in a desert theatre. They do not have proper equipment. This is because the government has chosen to blow billions of dollars on pet projects over the last eight years instead of properly funding our armed forces.

I believe there is a day of reckoning coming on this. The $1.2 billion that this government committed in the December budget to our military is very clearly an insult. It is not just the opposition parties playing politics with this issue. It is not because the Progressive Conservative/Democratic Representative coalition has pointed this out to the government. This is beyond the issue of politics.

The minister stands up and accuses any of the four opposition parties of fearmongering when we endeavour to raise these very serious issues. I would suggest it is not fearmongering. I would suggest we are not fearmongering when we are talking about the lives of our young men and women who are so proudly serving our country overseas. That is not fearmongering. No one can tell me that Liberal MPs do not hear this from constituents just as much as we do. We have a duty to raise these concerns on the floor of this Chamber with the cabinet, the executive of the government, which has made these poor choices that have put our young men and women at risk.

It is not just the opposition that has said this $1.2 billion is completely and totally inadequate. About $1 billion a year is needed for our armed forces just to catch up to where we should have been before we undertook this latest mission in Afghanistan.

As other colleagues have said, this budget has failed in so many areas that one does not know where to begin. There is nothing for seniors, nothing for youth, nothing for the most vulnerable in our society. Supposedly this is a caring government. The Liberals keep saying they care about the most vulnerable members of society yet the budget does not reflect that, not one bit.

[The Deputy Speaker]

It being 1.30 p.m., pursuant to order made on Thursday, February 7 it is my duty to interrupt the proceedings and put forthwith every question necessary to dispose of second reading stage of the bill now before the House.

Is the House ready for the question?

[Some hon. members]

Question.

[The Deputy Speaker]

The question is on the amendment. Is it the pleasure of the House to adopt the amendment?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[The Deputy Speaker]

All those in favour of the amendment will please say yea.

[Some hon. members]

Yea.

[The Deputy Speaker]

All those opposed will please say nay.

[Some hon. members]

Nay.