Mr. Speaker, the motion before us today states:
That, after overpaying at least $3.3 billion to several provinces as a result of its own accounting errors, this House calls upon the government to forgive any past revenue overpayments to the provinces since retroactively clawing back these revenues would severely affect the provinces' ability to pay for healthcare, education and social services.
Our new finance minister promised to mull over the idea of payback and said he will pay closer attention to the thorny issue of more than $3 billion in overpayments by the federal government to the provinces. Our man of finance of the people's money said he has received a series of reports from the federal auditor general on what has been called the overpayment of taxes collected in the 1990s but has not yet decided what to do. Let us hope he does not forget that it is not his money. It is ultimately the taxpayers' money which the government has erred in how it gives the money back to those from whom it took the money in the first place.
Between 1993 and 1999 Alberta, British Columbia, Manitoba and Ontario received more money than was apparently due them under existing formulas in redistribution of income tax revenues. Most of the $3.3 billion poorly calculated payments, about $2.8 billion, went to Ontario which has vowed it will not return the money. According to the documents the error stems from the way capital gains taxes on mutual funds were accounted for. Finally, one of the silent bean counters found something was amiss.
These acts certainly support the conclusions that I came to in past years through sitting on the House Standing Committee on Finance. The Liberals cannot manage the nation's business. The public has every cause to have low trust levels for what the government says about the state of the nation's finances and why it redistributes tax dollars the way it does.
What we are saying today is that the federal government should not punish Canadians and their provincial governments by clawing back the $3.3 billion of which it lost track. Canadians deserve better management of the public trust and they also deserve a wiser rationale for redistribution. The government must more appropriately consider how in the long term nations prosper, how more people in a society can share in that prosperity and how wealth itself is actually created and how it is so often destroyed by governments.
The federal Liberals play favourites. They use tax dollars for government business but favour contracts to their friends who happen to also donate heavily for partisan political purposes to the political party. There is supposed to be a division between partisan brand name political activity and the operations of government, which is supposed to be done on a non-partisan basis on behalf of all the people regardless of any political affiliation.
Patronage, cronyism, payola, contract bidding manipulation and insider deals of all kinds were supposed to have gone into the dustbin of history like the old bribery schemes of the Conservatives and the Liberals done in Canadian elections when we did not yet have a secret ballot on election day. The Liberals in 2002 are a disgusting throwback to a primitive political time in Canada.
The government plays favourites but in the process usually does not get good value on behalf of the taxpayer. Often the work done is substandard for the main game was the payoff for political gain rather than the work done for Canadians. Then the government plays the game of favourites among the provinces.
The finance minister stood in the House and said that he is considering working out a plan to take back what has slipped away from the government. Surprisingly however, this does not apply to Manitoba. Ottawa has agreed to cover most of the $710 million overpayment.
The Liberals want British Columbia to repay it all but they assured Manitoba that it was off the hook for most of it. The Manitoba Doer government was assured by Ottawa that the federal government will cover between 70% and 80% of the $710 million overpayment it made to that province. In an interview Manitoba finance minister Selinger said the federal government would take responsibility for the bulk of the transfer funds overpayment based on precedents and assurances.
The implication of having to return the entire overpayment would have been significant for that provincial treasury and I say every other provincial treasury as well. Certainly it would destabilize other provinces. If Manitoba had to repay the entire $710 million, it would have meant less money for health care or perhaps a delay in phasing out the education support levy, which is tacked on to property taxes. If Ottawa covers 80% of the overpayment, that would leave $142 million still in dispute.
Nevertheless, despite the promises to one province the federal government is contemplating clawing back money from many other provinces. We say the federal finance minister cannot correct it just for Manitoba. He has to correct it for everyone.
The Liberals still talk about clawbacks yet make a deal for one province. Then they take a swipe at the independent auditor general when they do not like her message. The Liberals launched a calculated campaign to discredit the auditor general to prevent her from unearthing further evidence of the corrupt way the government doles out its millions of dollars in federal contracts.
The Liberals have the gall to say that auditor general Fraser appears to lack impartiality and may be on a witch hunt against the government. The political fallout from the auditor general's reports is explosive. When political leaders go rotten, voters must take notice, wake up from their complacency and stop believing all the pabulum they are fed that everything on Parliament Hill is just okay. Some of my good friends on the Liberal backbench must be very embarrassed, yet with their votes they keep the sick system going.
The situation is clear. The government's mishandling of $1.6 million in sponsorship contracts to Montreal based Groupaction is an indictment of how badly the government manages public finances. Then we observe how far it will go to cover up the evidence.
The government's ideology is clear: abuse public trust; pay off friends; cover up the dirty deeds; and then impugn the messenger. This is an attack on more than the auditor general. It is an attack on the principle of government accountability and duty to the public.
We have to be thankful for the existence of the auditor general. In her scathing report she blasted the government for its appalling disregard for financial probity and revealed that it did not get all the service for which it paid Groupaction $1.6 million. To determine just how more widespread the poison is, she announced she will conduct a government wide audit of advertising and sponsorship programs and contracts.
It seems clear the government uses sponsorship and advertising programs to award companies that were supportive of Liberals and which funnelled political contributions to the party's coffers. That behaviour is highly unethical and is not an acceptable Canadian standard. Now the government is horrified that the auditor general has begun an investigation that could lead to evidence of corruption at the most senior levels of cabinet.
It seems clear to me that we need an independent judicial inquiry that can get at the technical evidence but also look at the political manoeuvrings and broad issues of political honesty and transparency. Financial audits cannot do that by the nature of their scales and mandates. Such an inquiry would complement the auditor general's wide scale review because it would have broader powers to subpoena witnesses, examine documents of private companies and ensure greater protection for public servants who wished to testify.
When the Liberals are shown also to be bad managers of redistribution schemes, they blame the auditor general for taking so long to catch them and then say that the receivers of their mistakes will pay the price of the government's failure. It is all so typically Liberal. It smells and it stinks. The bobbing and weaving is just so low class and repulsively gross.
The opposition is more than just the watchdog of what the government does. We offer hope. We offer an alternative and a way out of the mess. It goes beyond saying that our potential cabinet ministers have character and have real guiding principles to govern them. We also offer basic system change. We offer a new way, that while replacing the ethically challenged Liberals with ethically empowered people, the old system that offers the potential for abuse will also be changed.
The basic nature to be naughty should not be in the realm of possibility. The levers of power must also be professionalized and modernized into ethical management practice and they must be harder to reach. The answer is to change both the people and the system that tends to corruption. Good people can make good things happen. Modernization of systems can allow good people to become great.
We observe a disorderly old Liberal Party of 19th century political ethics where ministers behave as if Canada were their private sandbox in which to play. They leave a legacy of missed opportunity and a malaise of national hopelessness where it seems nothing can improve. Voters believe that probably all politicians are just the same.
What inspires me is that some day the Canadian Alliance will bring governance into the 21st century, of possibility and of bright hope. We can change the system as well as the people, and we can begin for the first time as a country to fulfill our true national potential.