Mr. Speaker, I will be splitting my time with my colleague.
I am pleased to rise to speak to this important issue today. The official opposition is asking for something simple. We are asking the government to forgo any collection of the $3.3 billion overpayment to the provinces, an overpayment that is a direct result of a federal accounting error.
That this should even be an opposition supply day motion is an indictment of the government. This issue should have been resolved months ago. The provinces were told about this at the end of last January. It would seem that the federal government knew about it some time before that, although how much before we will probably never know.
Where was the Prime Minister? Why was the former minister of finance not making this $3.3 billion disaster his top priority? It would seem that both he and the Prime Minister were too busy with their own internal squabbles.
The former minister of finance is said to have favoured forgiving this error. However the current Minister of Finance is said to support trying to recoup the money. He has also stated that he will follow the course mapped out by his predecessor.
It seems that the minister has a choice in front of him. He could wade into this moral and legal swamp as the enforcer of the Prime Minister's bully boy tactics or he could take the high ground and recognize that this was an error of the federal government that the provinces should not be forced to pay.
However a warning is in order that bad things tend to happen to free thinkers on the Liberal side of the House. If he dares to stand up for the provinces he may find more than just his leadership campaign getting choked off.
The Minister of National Revenue has been quoted as saying that this is between governments. “It does not affect individual taxpayers”. I submit that the minister was seriously mistaken. There is only one taxpayer. The loss of $3.3 billion will affect individual taxpayers. They will face even bleaker choices in the future of their health care and education budgets.
The Canadian Taxpayers Federation reports that health care costs have taken up 62% of all provincial budget increases in the last three years. The total cost will exceed $100 billion annually within a decade.
In my home province of British Columbia we are just now beginning to dig out from under 10 years of NDP mismanagement. Overall health care costs are expected to consume 50% of all provincial spending in B.C. by 2007. Hard decisions have to be made right now. The B.C. government is trying to put our province back on its feet. It is already stretched to the limit and the loss of $121 million more would be catastrophic.
When the Minister of National Revenue suggests that decisions of the government in Ottawa will not affect individual taxpayers, she is sorely mistaken. There is only one taxpayer. Somehow the government has missed out on this very simple concept. It is unable to grasp that. If the funds are taken away from the provinces, the services the taxpayers have already paid for through taxation will be reduced. If it is suggested that they will get the same services from the federal government, I would suggest that the government should look at the record.
In 1957, when the federal government became involved in Canada health care, funding was supposed to be on a 50:50 basis between the provinces and the federal government. Since that time the feds have become increasingly interventionist while also eroding transfers. Today the federal government pays for less than 14% of health care costs. The federal government has habitually cut transfers to feed its own spending habits and, my goodness, have we seen a lot of these spending habits.
We see all kinds of government mismanagement and waste, and money going to its own personal cronies. I will get to those in more detail in a few minutes.
While transfers to the provinces have been cut by 33% discretionary spending by the federal government, again money that it diverts to its friends, has only been reduced by 6%. At the same time we saw the $1.1 billion boondoggle that was in the Department of Human Resources Development. It put hundred of millions of dollars of questionable grants in the Prime Minister's riding. We have seen that over and over again. There is more money going into the Prime Minister's own riding than the four western provinces combined.
The government paid $1.5 million to get the same useless report done three times. It paid someone to slap a new cover on it, change a few words, pull it off the Internet and resubmit it to get another half million dollars while ensuring that there was a cheque for the Liberal Party of Canada. It is appalling but the Minister of National Revenue said that it does not matter.
With a record like that we would all be better off leaving this so-called overpayment in the hands of our provincial governments. There is compelling evidence to put as little of our money in the hands of the federal government.
I know the hon. member for Ottawa South has considerable demands on his time. Not only is he the new Minister of Finance but he remains the infrastructure minister and the Deputy Prime Minister. Given his busy schedule I want to offer him some advice.
For years the Liberal government has interfered with the areas of provincial jurisdiction. We have seen it over and over again. It has waved its spending authority around like a hammer, careless about what it might smash in the process. Planning by the provinces has been difficult in this climate. Funding is reduced and innovation is discouraged with threats of further funding reduction. This all needs to be changed.
In the short term we need: first, stronger limitations on federal spending power, something that would prevent the federal government from encroaching on provincial authority through clever manipulation of purse strings; second, a binding dispute resolution mechanism, not just an informal non-binding agreement to co-operate; and third, an audit system to ensure that the federal-provincial transfers are not subject to these kinds of mistakes in the future.
In the short term we need something simple. We need to re-establish trust. Imagine what a novel concept that is, to actual regain some trust. We have seen in the polls trust plummeting among the Canadian public. Why? It is because the government blatantly doles out millions of dollars to its cronies, to its friends, to people who donate back to the party. We have seen it in the advertising and promotional contracts and in the Groupe Everest contracts. We have seen it in other departments as well where there is no accountability and there is nobody watching how this money is spent. The government says to trust it, it will do a good job. It has to establish that trust.
I urge the government to vote in favour of the motion and send a clear signal that it is able to admit that it made a mistake, which is another novel idea. It would be a signal that the government is willing to formally cease collection on the $3.3 billion and it will not make Canadians suffer for its errors. The minister would find such a decision to be a great first step. The government has a long way to go, but it would show that the government can trust the provinces to fund health care and education without playing the part of the schoolyard bully, always threatening to steal the lunch money of the Canadian people.
It comes down to few words. It is about competence, accountability and most importantly, trust. The government has breached all three of these and it continues to do so. It has to earn that back. Simply firing the former finance minister will not do it. It is time that the Prime Minister looked in the mirror and made some serious changes.