Debates of Oct. 2nd, 2003

Supply

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

Mr. Speaker, today is an official opposition supply day and I am delighted to speak to the motion.

The federal fuel tax issue is a prime example of a major irritant that has been allowed to continue since the government came to power in 1993 despite many attempts by the Canadian Alliance, the Federation of Canadian Municipalities, the Canadian Taxpayers Federation, and federal and provincial road builders to get the government to stop the process of taking billions of fuel tax dollars from Canadian motorists and not returning it to transportation infrastructure.

The statistics for my own province of British Columbia are illustrative. From 1998 to 2001, federal fuel taxes and the federal GST collected $6.4 billion from B.C. drivers and returned $31 million, roughly 0.5%.

Just as an indicator of the taxing power fuel taxes represent to the federal government, we witnessed earlier this year essentially a 10% increase at the pumps. This 10% increase represented a windfall to the federal government in GST fuel revenues alone of $350 million. The GST on fuel is for the most part a tax on a tax. That is most inappropriate.

On May 2, 2001, I embarrassed the federal transport minister by pointing out that in the previous year the United States had committed to spending more in British Columbia by upgrading B.C. highways at border crossings than did the federal government in all of British Columbia.

In the previous year, the federal government returned 0.5% of fuel tax revenues to British Columbia highways. The transport minister excused all of this by responding that it was not his fault because highways were a provincial responsibility. That being the case, then it is only logical to call on the federal authorities to vacate the federal fuel tax room to lower levels of government for their infrastructure requirements.

This is essential to our well-being and will address the fiscal imbalance that exists between the levels of government in Canada. Instead of fixing the fiscal imbalances, the former federal finance minister and now Liberal leader cut transfer payments to the provinces and made the situation worse.

The Canadian Alliance recognizes that changes have occurred over time and our institutional arrangements have not kept pace, unlike the government. Every attempt to get the federal government to stop the current reign of terror on federal taxation of fuel has been hindered by the federal Liberals.

Our industry and transportation critics have created a policy for the Canadian Alliance which was adopted by our parliamentary caucus and ratified by our national council. It is a policy we will run on in the next election, and it is a policy we will implement as government.

I can summarize our position quite well by including an excerpt from an address by the Canadian Alliance leader to the Federation of Canadian Municipalities' annual meeting in Winnipeg on June 2, 2003. Our leader proposed:

--that the federal government permanently vacate a portion of the federal gas tax--say three to five cents a litre--and allow provinces the option of collecting that revenue. In order to ensure that this money is not used for other purposes, the transfer of these revenues to provinces and on to municipalities would be conditional on signed agreements that these resources would be used for infrastructure.

This method of funding municipalities meets the criteria set out by the [Federation of Canadian Municipalities]: It would provide a reliable and stable revenue source for infrastructure. It would be as transparent and visible as constitutionally possible. It would have zero additional administrative and compliance costs--provinces already have infrastructure programs and collect gas tax revenues. It would be efficient--additional resources could be allocated to regional and local priorities. And it would be equitable--these revenues would become part of the equalization formula to ensure that all provinces receive the same per capita share of gas tax revenues. More importantly, this approach promises a worthwhile level of funding.

In the last federal budget, 100 million dollars were pledged for infrastructure for cities--not enough, as the [Federation of Canadian Municipalities] pointed out, for a single kilometre of subway line in Toronto or three interchanges in Calgary.

In contrast, transferring three cents per litre of gas taxes for infrastructure would mean an immediate, annual injection of $1.3 billion per year.

If we do the math, clearly the Canadian Alliance has a position that is on side with municipalities, provinces and the motoring public. The federal fuel tax regime is irrational and counterproductive. At every turn, however, the government has stymied our efforts to change this federal fuel taxing behaviour.

This is what the current finance minister had to say earlier this year when he rejected any notion of amending fuel taxes:

...I know that the provinces really like the tax points, but sometimes, they forget about them. They really like them because they want us to impose the taxes and then let them spend the money.

What money? During June of this year he stated further:

...I do not favour the suggestion that the federal government vacate the fuel tax...it is foregone revenue without accountability...it undermines the vital partnership that we must foster between and among levels of government.

That is not very encouraging.

On May 2, 2001, I asked the transportation minister the following question:

Last year the federal government collected $750 million from British Columbia fuel taxes and spent $408,000 on B.C. highways. That works out to the grand total of one-twentieth of one per cent of revenues returned to British Columbia highways. Why is the federal government gouging taxpayers and ignoring their highways?

Here is what the minister had to say:

I want to remind the hon. member that highway building in this country is the responsibility of the provincial government.

This incredible response was followed up by the finance minister's response to my further question, which was:

...the federal government collects federal fuel taxes. The provinces spend on highways what they collect in provincial fuel taxes. In 1998-99 the federal government collected over $4.7 billion in gas taxes and spent only 4% of that across Canada. It is called highway robbery. When is the government going to commit to fund a national highway strategy...?

The former finance minister, who may or may not have had a recent conversion on this issue, had this to say:

Mr. Speaker, the hon. member ought to know that the Canadian government receives tax revenues from a multitude of sources and those revenues are then invested. They have been invested...in the British Columbia health care system...in the education system...research and development throughout British Columbia.

That is not very encouraging for infrastructure.

The reality is that change is long overdue. We have a national highway system in Canada but no national highway strategy. We have long unresolved grievances about a lack of federal commitment to infrastructure. We have major transportation needs identified, many resulting from federal facilities, such as Roberts Bank and Vancouver International Airport.

As well, we have had serious problems at the provincial level in terms of funding because of the softwood lumber dispute, SARS, BSE, forest fires and hurricanes, heavy burdens indeed.

I will conclude with one sentence. The motion put forth by the Alliance today is consistent with an earlier motion we put forward on June 12, 2003, which was defeated by the government, and I hope for better this time.

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, I think all members would agree that this is an important debate. I am sure the member would agree that the measure of success of a country certainly is the measure of the health and well-being of its people, and that the support for our cities, basically the ground floor where it happens, is extremely important.

The motion is with specific reference to the gas tax and the sharing of that. As the member knows, that goes into the general revenue pool. I wonder if he would agree that the issue is not so much the gas tax but whether or not there is a commitment of resources commensurate with the need, not just the need of the big “have” cities but also of the cities that are “have nots”.

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

Mr. Speaker, I appreciate the sentiment, but I would like to disagree with the premise of the question from the standpoint that this federal government always wants to be earmarking money to go to the provincial governments.

We are suggesting something very different. We are suggesting vacating tax room so that the provinces and the municipalities, the local governments, have the ability to use these fuel tax revenues for infrastructure needs. We only have to look at other jurisdictions such as the U.S., where fuel taxes are collected on the basis that they will be used to fund transportation infrastructure. That is what happens. That is why they have a very successful infrastructure system and we do not.

[Roy H. Bailey, Canadian Alliance, Souris—Moose Mountain, SK]

Mr. Speaker, in response to a point my colleague just made, I recall that in many of the states where I have travelled, when one pulls in with a car to fill it up, the federal tax and the state tax per gallon are listed. I have looked into that a number of times. It simply means that once the state proves it has spent its taxes toward the infrastructure such as highways, bridges, maintenance and so on, the federal government then kicks in its taxes. As my hon. colleague said, that is exactly why they finance a better highway system than we do.

One of the difficulties in doing the same thing in our province is that we could put on the provincial tax and the federal excise tax, but then we would have to throw on the GST. As the price of gas goes up and down, the GST is variable and there is no requirement for that. I would like this country to examine that same idea, because I believe it would work in Canada.

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

Mr. Speaker, I have had some discussions on today's motion with members of the British Columbia government. They are certainly highly interested, not only in the debate but in the vote on Tuesday. This is just such a natural, positive action to be taking that it is incredible we have not reached here before now, despite many attempts by the opposition to make it happen, as I have said.

I will mention that there are three components to this fuel tax: the excise tax, which we are asking to be earmarked; the deficit-fighting tax, although the deficit has been gone for five years, so we think that should be eliminated; and the GST, which is a tax on a tax, much of it, and which is most inappropriately charged and is an incentive for higher gas prices because higher gas prices lead to higher revenues for the federal government, largely through the GST. It is a perverse incentive for higher prices.

[Bryon Wilfert, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, it is like being in Back to the Future , if anyone has seen that movie. We had this discussion back in June. It is the same sequel and the same cast of characters, but at least the Alliance, for a change, is being somewhat consistent. The fact is, as everyone knows, I have said many times that when it comes to municipal government issues that party's sincerity is somewhat interesting since it historically has never supported municipal governments in the past. I will go through an array of issues with them.

It is very good to talk about a little history. For those who obviously are not aware, first of all, my friend and colleague from Dauphin—Swan River and I worked together over the years through the Federation of Canadian Municipalities when I was president of that organization. I remember the very dry days back then, when the government of the day did not even entertain the issue of national infrastructure.

In fact, for those who may not remember, in 1983 the Federation of Canadian Municipalities, and at that time there was a $17 billion national infrastructure deficit, went to the government of the day and said, “We need to get into a tripartite arrangement on traditional infrastructure, roads, sewers, bridges, et cetera”. The government said it would entertain that. Unfortunately, the government was defeated in the 1984 election. Then along came the Progressive Conservatives, with clearly a heavy emphasis on the conservative and not on the progressive because they did not support the national infrastructure program during their entire time in office.

Therefore, it was this government and this Prime Minister that in 1993 pledged to in fact bring in the first national infrastructure program, a tripartite arrangement. True to the Prime Minister's word, in 1994 that came in and I had the pleasure of working with the government at that time as part of the FCM in terms of making sure that this program came into effect.

Since 1993 this government has invested over $12 billion, and when one leverages that, over $20 billion, in terms of national infrastructure. The fact is that the party over there opposed it in 1993 and it opposed it in 1997. It is good at that, but now that party knows it is popular and it knows that after three programs this has become extremely important.

This motion is a little weaker than it was before, but basically it is inviting the government to have discussions with the provinces on the issue of sharing a portion of the gas tax. I can tell members that this government would be more than happy to talk to the provinces and territories anytime. My concern, and I have raised this many times, is the mechanism by which, if we vacate the tax route, in fact we will be assured by the provinces and territories that municipal governments, whether they are urban or rural, will in fact get the money.

In terms of the motion before the House today, I certainly can support it, because it simply is asking that we enter into discussions. I can tell everyone that this government can do that and will do that and will hear what the provinces and territories have to say.

But the reality is that this is only a portion of the issue. The real issue is, how do we ensure that? We believe on this side of the House that if we have a tripartite arrangement all three orders of government in this country participate fully as partners. If one is going to fund a third of the money, one should have a third of the say. I have always commended the government of Alberta for the fact that the government of Alberta has always had at the table municipal, federal and provincial representatives in terms of the approvals.

The fact is that this government needs to take no lessons from the party across the way because, simply put, it is this government that not only brought in the national infrastructure program but renewed that program in 1997, in fact, if the hon. members across the way would look at the record. The problem is that when we sign agreements with the provinces, each agreement is different.

Therefore, to my good friend from British Columbia, at one time a previous government of British Columbia was suddenly ordering all sorts of buses that were showing up in municipalities and not necessarily what they wanted.

From the beginning we have said that the program must be municipally driven. As a former municipal politician, we at the municipal level know what the needs are in terms of the communities, whether it is roads, sewers, bridges, whatever. Therefore, when we look at a five and 10 year capital forecast, we want to ensure that we can put forth projects and hopefully get the support of the province and, obviously, the Government of Canada.

I have always said that if they are proposing it, then I, as a member of Parliament, support it because they obviously know what their needs are in the community. It is not up to me as a member of Parliament or up to the Government of Canada to tell a city X what its needs are. The fact is this was such an important program.

I know we are not allowed to use props so I will not show it, but in the January and February Forum of the FCM of 1997 I read an article that was devoted to infrastructure. At that time we were talking about getting the first national infrastructure program extended, and the Prime Minister was prepared to listen.

On the team Canada mission in 1997, I had the opportunity to meet with the Prime Minister and the premiers, except the premier of British Columbia. The Prime Minister and the premiers were prepared to entertain an extension of that program. In the end we got that extension. Some were a little later than others. Ontario was very slow. In fact it only agreed at the eleventh hour before the federal election was called in April of 1997. However we got it and it was extended. If it were not a good program, we would not have municipal governments supporting it continually.

We have a deficit in Canada when it comes to infrastructure. Had we acted in 1983, we would be in a lot better shape.

Respecting the constitutionality, municipal governments, which are creatures of the province, and I hate that term myself, they get their powers or not from the provinces, and we accept that. We also accept that there was a vital role for the government to play in a number of areas, in partnership with our municipal cousins and obviously with the provinces and territories. That over the years has been very successful.

Members also will know that we introduced the strategic infrastructure fund, another very important program, for larger projects in the urban scheme as well.

In my own area, the greater Toronto area, we were able to benefit by an announcement at the end of April of $435 million, matched by municipalities, by GO, TTC and others and by the province, finally. We were able to commit over $1 billion to improve the transportation infrastructure in the greater Toronto area. Why? Because these were proposals that they made. Not the Government of Canada, not the Ontario government, but the municipal authorities, which is very important.

I point out that when we talk about allocation of dollars, our friends across the way often talk about the fact that we are not giving enough.

I remember the days, and it is sometimes very useful to have some history behind one, when we argued at the FCM for a 10 year program. Remember that under the Conservatives we never had a program. Then when the Liberal government came in, we got a program, then we got another renewal and then we got another program. Under the Minister of Finance and the Prime Minister we have committed to a 10 year infrastructure program in this budge.

I said earlier that it is important for municipal governments to plan ahead. He said that we would put a down payment on it. Of course the word that some members in this House do not use, and it is shameful they do not, is the word leveraging. It is the role of other governments and the private sector to contribute to federal funding to ensure we can advance these programs. When we talk about leveraging, it is not simply the federal government.

The provinces of British Columbia, Alberta and across the country have benefited significantly from these programs.

The hon. member in his speech this morning talked about the fact that we had to vacate this money. I am not sure how much he would like us to vacate. I assume he is also suggesting where we will find extra dollars because he will then be complaining about other federal programs that the government needs to be funding. At the same time, the government is prepared to come to the table, as we always have.

A few years ago we had Bill C-10 which was a very important issue regarding payments in lieu of taxes. In 1949 the then Liberal government had an informal agreement in which it agreed that in lieu of taxes it would pay a certain amount of money to municipal governments for services for federal properties.

I believe in 1992 under the Conservatives there was an arbitrary 10% cut. What happened was there could be a CTV building and a CBC building in a riding and one received a 10% discount. It was unfair and unreasonable and the municipality was still providing services to both.

This was something that the government had been pushing for years. Bill C-10 came to the House a few years ago. The government passed legislation which said that the Government of Canada would be treated like any other taxpayer. The government had to pay on time, otherwise it would pay interest. There would be guaranteed payments. The government would know what the assessment would be. If the government did not like the assessment on a federal property, then it would go through the procedures that every other taxpayer had to go through.

That party over there voted against it. If it really were interested in supporting municipal governments, I would have assumed it would have supported something like Bill C-10 as an example.

I would also point out that the issue here is simply accountability. I certainly believe that with municipal governments there is a new partnership. The Prime Minister launched the Prime Minister's task force on urban issues. The government made a number of recommendations. The government talked about a national transportation study, a national housing strategy and other recommendations.

Of course the naysayers over there really do not understand what it is all about. One day they will the fact that when we enter into partnerships, we are talking about true partnerships. We are talking about financial partnerships and policy issues. It is obviously hitting the right accord because even the Alliance gets it, which is good to see. I really welcome that because for years I had to deal with those on the other side who were not as positive.

The fact is we are talking about investments in cities. We also are talking about other investments. The government has done that in health care. It has done it with universities. It has done it in an array of areas such as housing which is very important. It makes these cities more liveable. Canadians cannot have liveable cities if they do not have the right infrastructure.

Provinces have the ability and the tax room that the government has. They have the same fiscal capacity as the Government of Canada. Municipal governments clearly are restrained. In some provinces they have more levers than others in terms of being able to raise taxes.

The most antiquated form of taxation I still believe is property taxes. Unfortunately they are dealing with that.

We want to see an arrangement where we can play a constructive role respecting provincial jurisdiction and at the same time work cooperatively with them. However I do not think it would be wise to simply write a cheque to province X and not have a clear direction of where that money is to go.

My colleagues on the other side talk about strings. I find that a rather odd statement because to me there has to be accountability, whether it is a national health council to track where the money goes. The transfers are for Canadians, not for the federal government. If money is transferred to the provinces, Canadians should know where it goes. I believe that accountability, whatever order of government it is, is extremely important.

The government has taken action in many ways. If it were not for the Liberal government, the Autoroute 30 around Montreal would not have been dealt with. The Red River floodway is very important. We know the Government of Canada stepped in and worked with the province of Manitoba, again cooperatively. These are cooperative efforts. The Government of Canada is not saying that the provinces have to do X. That is probably why this side of the House has so many former municipal colleagues. They know the work that the government has done since 1993.

We are not ashamed of the fact that we have had three national programs and we have worked in areas of housing and others. The national homeless strategy involved working cooperatively with other orders of government and with grassroots communities across the country. The Minister of Labour took the lead in that area. The results were very positive, and $753 million came from that. This is about partnership and about working together.

The hon. member would like us to talk to the provinces and territories about the issue of gas taxes and that is very much a reality. That can be done. However it will not work unless we ensure that moneys that go to the provinces wind up directly with the proper formula for rural and urban municipal governments.

I will not say that we have all the answers because we do not. However we know the other side has no answers at times. We on this side of the House have not just talked about these issues but have delivered on these issues. There is a big difference between talking about them and doing something about them.

The member across the way is too young to remember the 1993 infrastructure program, but if he had been around he would have known about the tremendous work that the government did. Other examples of the government working collaboratively with municipalities are the municipal enabling fund and the green municipal investment fund. It was this government that empowered the FCM with $200 million originally to work on issues dealing with the environment such as improving air quality et cetera. The 10% club was formed to reduce CO

2

emissions by 20% over 10 years. This is true cooperation. It is not talking about it. It is delivering.

The government even delivered to the riding of my friend across the way, and I know he is very appreciative. He should talk to his former mayor because he might actually learn a few things about municipal government. He was a good mayor and a very popular mayor.

We also have to look at the fact that the government has set an agenda. We believe that investing in municipal governments and in infrastructure is extremely important. Therefore we continue to look at all reasonable options. At the same time, the government will not go back into a deficit. We continue to ensure that we balance the books. We will ensure that issues such as paying down the national debt and investing in the social fabric of Canada continue. We can only do that if the dollars come and we account for those dollars.

Unfortunately, we had to deal with a $42.5 billion deficit. I am amazed that we did not get credit for the fact that at the same time as we had the $42.5 billion debt, we still invested in the national infrastructure program. Why? Because it returned tax money and created jobs. It was a very important initiative even when we did not have the money. Look at the highlights. We have a 10 year program, people are investing and it is good for the economy.

[An hon. member]

You're eyes are turning around.

[Bryon Wilfert, Liberal, Oak Ridges, ON]

I know my friend across the way would rather yell at me because he does not want to hear the truth, and I understand that. If I were him, I would not want to hear it either. With the sorry state of that party in terms of its record on this issue, I would be embarrassed if I were them, but then again maybe they do not embarrass easily. They should be embarrassed though. They know it was the Liberal government that brought it in, it is this government that continues it, and in all facets.

When we talk about this type of approach, they ask if we are going to swallow ourselves whole. Absolutely not. We have to be very clear here. If the issue is simply entering into discussions, the government has an unblemished record in its ability to deal with our partners and all orders of government.

[James Moore, Canadian Alliance, Port Moody—Coquitlam—Port Coquitlam, BC]

Mr. Speaker, it is always interesting to hear a speech by the parliamentary secretary. We cannot really have a rhetorical farce without a cameo appearance by the minister's deputy. It is always nice to have him in the House.

The minister says that because the Canadian Alliance opposed what the Liberals described as an infrastructure program, therefore we are opposed to infrastructure. Well yes, we oppose it because it was a dumb idea. It does not matter if they call it an infrastructure program. If it is a dumb idea we are going to oppose it. The government built a canoe museum in the Prime Minister's riding and they say, “Well, that is part of infrastructure and if you vote against that, you are against infrastructure”. That is the kind of mindset the government has.

Of course we are opposed to that because we are the watchdogs in the House for fiscal responsibility. Year in and year out, budget after budget for a decade, nine budgets from the former finance minister, the new Liberal leader, and he failed to do this.

The member opposite, the Parliamentary Secretary to the Minister of Finance, said, “Well of course we are prepared to do this. We are prepared to meet with the provinces and talk to municipalities”. They have had 10 years to do it and nothing happened until the Canadian Alliance moved this motion. We are going to vote and we are going to win the vote. This Canadian Alliance motion, our policy, our ideas are going to win next Tuesday, and finally we are going to see some action from the government. It would not happen if the Alliance was not in the House. It would not happen if we did not move this motion. The government has had a decade to do it and it has persistently failed to have straight lines and accountability with regard to gas tax dollars.

I always find it appalling that the member opposite says, “We need assurances from the provinces. We have to have assurances from the provinces to make sure that this money goes into roads”. The member opposite often starts sentences with “the fact is”. Well the fact is that provinces gives an average of 91.6% of their gas tax revenues to roads. The Liberal government, the finance minister who the member trails around the hallways, gives 2.4% of its gas tax dollars to roads.

The provinces do not have to take any lessons from the government in terms of accountability. The minister and the government should learn the facts and just give the dollars to the provinces. It should certainly be on condition of agreements but the provinces do not have to take any lessons at all.

I did appreciate however that the member said he appreciated the job of the province of Alberta. He said that the Alliance does not know what it is doing but the province of Alberta does. Well the member should know that my seatmate in the House is the former finance minister of the province of Alberta who set up the regime that he praised in the House. We know what we are doing. We have our agenda right. We have been consistent and right on in terms of accountability in gas taxes.

The member said that he wants accountability, straight lines and appropriate behaviour by the government with regard to taxation, so my question is simple and clear. His choice for the leadership of the Liberal Party, the man who is the new leader of the Liberal Party, put in place a 1.5¢ per litre gas tax to pay down the deficit. The deficit, because of economic growth, is gone. The deficit is gone but the tax remains. Could the member please explain how it is accountable to have a deficit reduction tax still on the books when the deficit is gone? Explain it.

[Bryon Wilfert, Liberal, Oak Ridges, ON]

Mr. Speaker, first of all, the only thing that is trailing around here is the Alliance Party. That party is so far behind on this issue it is incredible. I am glad I am not in an airplane because I know what I would be reaching for at the moment, if I might say, listening to the member across the way here. The audacity of the member is unbelievable.

I would tell the member that it was because of the work of the former finance minister, the member for LaSalle--Émard, and the work of the Prime Minister that we got the national infrastructure programs that we have. That group of course does not realize that.

Alliance members talk about funding. We do not have dedicated taxes. News flash to across the way: no dedicated taxes. If the member is suggesting that we bring in dedicated taxes, that is a whole different issue of policy debate we would have to have.

The reality is that sometimes the Alliance members get their lines confused. They talk about funding roads. They talk about the provinces. They talk about a road between city x and city y . I am not quite sure if they are suggesting funding provincial roads or if they are talking about municipal infrastructure within communities, because there is a big difference.

The member referred to the 1.5¢ tax of 1995. Well first of all, he needs to do a little homework. In the mid-1990s the government of New Brunswick reduced the gas tax by 2¢ and the oil companies within a flash upped the price. So there is no guarantee in removing anything unfortunately.

Where does money go generally? Let us be honest with the public. The money goes to consolidated revenue which pays for health care, which pays for post-secondary education, et cetera. That group over there somehow thinks that by eliminating 1.5¢, all the problems will go away.

I do not hear him saying anything about the $100 billion tax cut, the largest in Canadian history. I do not hear anything about the only G-7 country paying off the national debt. I do not hear anything about six balanced budgets or better. That is because you suffer from selective memory and you always will.

[The Deputy Speaker]

Let us just be mindful that the Chair is always occupied and to make those interventions through the Chair.

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

Mr. Speaker, the federal Liberal government, under the Prime Minister and the new Liberal leader, the former finance minister, the future prime minister, have sucked billions of dollars out of British Columbia in gas taxes and they have returned precious little to our communities of Pitt Meadows, Maple Ridge and Mission. Of federal gas taxes, 2.4% goes back into roads. Imagine someone taking a dollar from us and giving us back 2¢. That is a rip-off.

If the Canadian Alliance policy were implemented, dedicating 3¢ to 5¢ a litre in gas taxes back to the provinces and municipalities, important improvements, such as the twinning of Highway 7, the Lougheed Highway in Maple Ridge and Mission as well as the building of a new bridge from Pitt Meadows and Maple Ridge in my riding to Langley across the Fraser River would already have been a reality.

The hon. member tells us that the dollars go into consolidated revenue and that they are wisely spent in priority areas. If that were true, we would applaud the government. Unfortunately, it has wasted billions of dollars. We are all aware of the billion dollar boondoggle, the advertising scandal, the dollars to the Prime Minister's friends in his riding and on and on it goes.

If there were dedicated dollars to infrastructure as we have laid out in our policy, that would be a positive thing. That is what we are asking the government to do. That is what Canadians want to see. The hon. member has no excuse for the fact that the government has only returned 2.4% of gas taxes back into roads across the country. That is just not acceptable.

[Bryon Wilfert, Liberal, Oak Ridges, ON]

Mr. Speaker, again the member seems to be confused. The member is talking about roads. Is he talking about provincial roads? Is he talking about municipal roads? What is he talking about?

The fact is that the government has continued to make sure that we work in collaboration with all orders of government and that we are dealing with municipal infrastructure. If he wants to have a separate program with something else, if he wants to have dedicated taxes and if he wants to do other things, then he should come clean and say so. If that is what he wants, let us have a public policy debate about it.

The reality is that had we not instituted in 1994 the national infrastructure program, we would have a far larger national deficit on infrastructure than we have today. In fact the alternative would have been to do what the Tories did; we could have said that we cannot do this because we have a $42 billion deficit, that we cannot invest. We believe that was wrong. We believe we could do a lot of things constructively and we did them.

The reality is that this side of the House has demonstrated its commitment. I did not hear any response on the issues of payments in lieu of taxes, another good example of where that party says one thing but does not deliver. I watched the members with some shock, I must say, when they did not stand up to support the government on this important issue.

In some of the ridings of those members, I talked to the mayors and councillors and they were horrified. They did not even know that particular debate was going on here and that their members were not supportive of the government on an issue which has been near and dear to municipal governments since 1949.

[Rick Casson, Canadian Alliance, Lethbridge, AB]

Mr. Speaker, I will be splitting my time with the member for Edmonton Southwest.

It is good to take part in the debate today. There will certainly be one ex-municipal politician following another here.

I spent 18 years as a municipal politician. One thing we always had trouble with when these programs came down from on high was sometimes we only needed two-bit dollars. We only had to throw in a quarter out of a dollar to get something financed and we even had trouble doing that. At the municipal level there is nowhere else to download to. That is it, that is where it stops; the municipal level is where the buck stops. There is only so much load that a property tax can hold.

What we are talking about today is a huge amount of money that the government takes from Canadians through a gas tax that was put in place, whether it was legally done or inferred, to improve the country's transportation system.

Canada is a large country. We do lots of trade east and west and north and south. People are on those highways, whether it is for pleasure or every day trying to make a living, and the infrastructure is falling apart. Our bridges and our roads are a terrible mess.

A country such as Canada that has so many resources, that has been blessed with all kinds of natural resources, should be rolling in industry. It would be, if the government would look at some of the taxes it charges and the taxes that scare people away and the taxes that hurt business.

When we look at east-west transportation particularly on the key trade route which is the Trans-Canada Highway, with the amount of trade on that road every day and the amount of licence fees that are collected by the provinces, that money needs to go back into highways and I believe it does in most provinces. However, the federal government collects the gas tax and does not put its fair share back into the infrastructure. This is causing all kinds of problems.

The member for Wild Rose has brought up in the House time after time the issue of the piece of highway that goes through Banff National Park that needs to be twinned and it has not been. It is a death trap. It was good today that the industry minister stood up and said that the government will finally fix that, but that should have been done years ago. It takes a tremendous amount of pressure from a member of Parliament such as the member for Wild Rose to force the government to act.

The Alliance has brought forward the motion today, and it is similar to a motion that was brought before the House before which was voted down. There is no consistency. The previous member talked about the government being so consistent and the Alliance always changing its mind. The government has flip-flopped on this issue.

I want to read what our leader said at the FCM convention this year. The previous speaker was a part of that organization. Our leader said:

What we are proposing instead is that the federal government permanently vacate a portion of the federal gas tax--say 3 to 5¢ a litre--and allow provinces the option of collecting that revenue.

In order to ensure that this money is not used for other purposes, the transfer of these revenues to provinces and on to municipalities would be conditional on signed agreements that these resources would be used for infrastructure.

That was back in June. The Alliance has had that as a policy. Now the would-be prime minister is running around the country saying basically the same thing.

We also have another policy which states that any tax that was put in for a specific reason, if it is no longer needed for that reason, that tax should be eliminated. If the 1.5¢ a litre was put in to reduce the deficit, when the deficit is gone, the tax should be gone and there is no doubt about it.

This summer we had a crisis in this country to do with the BSE issue and the livestock industry. We have asked if the government would consider reducing the tax on fuel that trucks use to haul products. The trucking industry has been smacked very hard by this problem. There has been no action on that. We have asked the government for other concessions to help relieve some of the financial burden for the truckers and there has been nothing.

Today there was an announcement in the House that the Prime Minister was given an environmental award. Having bad roads, bad infrastructure, and bad streets creates environmental damage because vehicles are idling, standing still, or not moving at the rate they should be and that is an environmental hazard.

That is one of the things we must remember when we are looking at improving infrastructure, whether it is public transit or better roads to keep things moving. It all has a bearing on the environment and we need to remember that. When we are looking at some of these issues, there are many spinoff aspects that come with it.

Just to make it a little more personal, motorists paid $6.9 billion in gas taxes and GST on gas in 2001-2002. That is $220 per Canadian for gas tax and GST alone. One of the things that is talked about most at coffee shops across the country is the price of gas. Every time the price of gas changes it is an issue to people. It is one thing they keep their eyes on.

One thing we have to keep reminding people of is that 35% to 40% of the price they are paying at the pumps is tax. If there was no tax every third tankful would virtually be free. These are the kinds of huge dollars we are talking about that are being collected.

Almost $7 billion is collected in fuel taxes by the government, yet it gives back $118 million into infrastructure for highways. That is unbelievable and completely unacceptable.

In order to get around this, our leader presented a proposal in June that 3¢ to 5¢ of the tax on fuel be vacated for the provinces and that agreements be struck so that money would go to the municipalities in an incremental manner so that it was not money they could take from elsewhere. I think that is fair and I believe the provinces would agree to that.

They realize that the deferred maintenance on infrastructure of all kinds in the country is absolutely astronomical. If we were to look at public institutions, transportation systems and bridges, it would add up into the multi-tens of billions of dollars very quickly.

Therefore, if we are going to build new and improved roads and buildings, we must look at what is already in place. When we start talking about the environment and making buildings more environmentally friendly, that all costs money. That is all part of fixing up the infrastructure that is in place.

The government, after voting against a similar motion this spring, will vote in favour this time. That will be interesting. It will vote in favour this time because the would-be Prime Minister, the former finance minister, is going around the country making promises that he has no right to do because he is not a minister of the Crown. The present Prime Minister calls him nothing more than a backbencher and here he is out setting up first ministers' meetings and making promises on what he is going to do with the taxes.

Therefore, it is very important that this motion be brought to light today to show Canadians that what we are proposing is what needs to be done and the fact that an unauthorized member of the House is going around the country offering to do this when he has no right to do so.

[The Deputy Speaker]

Before moving to questions and comments, it is my duty, pursuant to Standing Order 38, to inform the House that the question to be raised tonight at the time of adjournment is: the hon. member for Dauphin—Swan River, Firearms Program.

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

Mr. Speaker, it is my pleasure to support the Canadian Alliance motion that addresses this serious national issue. The motion reads:

That, in the opinion of the House, the government should initiate immediate discussions with the provinces and territories to provide municipalities with a portion of the federal gas tax.

I want to explain why my party is introducing this motion. It is to address the infrastructure needs of municipalities and communities across this country. In May 2001 the Federation of Canadian Municipalities made the following statement:

Traditional sources of municipal spending have proven to be insufficient to prevent an accelerating decay in the state of municipal infrastructure. Billions of dollars are now needed to rehabilitate, upgrade or replace aging facilities and roads. The Federation of Canadian Municipalities has long recognized the need for a concerted effort from all orders of government toward long-term solutions.

On a personal and local level, I met with the mayor of Leduc. Leduc is a city south of Edmonton along Highway 2 on the way to Calgary. It is a vibrant community of about 15,000 to 20,000 people. Its mayor is George Rogers, who is also president of the Alberta Urban Municipalities Association. Mr. Rogers is an active local politician who speaks strongly on behalf of his community and its needs. He was talking about the growth of that area around the Edmonton International Airport and the fact that basically, as a municipal politician, he was hamstrung in the sources of revenue he could access to address his infrastructure needs.

He was calling on me and the provincial government to address it. I think from his perspective the feds have simply not stepped up to the plate enough to address these infrastructure needs and I certainly agree with him. Leduc is a community along the Edmonton-Calgary corridor which the Toronto-Dominion Bank pointed out as one of the fourth most vibrant economic corridors in North America. We are certainly going to have to address communities all along that corridor.

I also received a letter from Mayor Bill Smith from Edmonton in which he outlined Edmonton's infrastructure needs. He talked about what the city council had called on us to do. He wrote:

The City of Edmonton has long been advocating stable, sustainable and long term infrastructure investment and fully supports FCM's appeal to the Government of Canada to address the fiscal gap between municipal needs and available resources. At its July 15, 2003, meeting Edmonton City Council adopted the following motion:

“That the City of Edmonton urge Edmonton's Members of Parliament to support the Federation of Canadian Municipalities call for a long term financially sustainable infrastructure program”.

Canadian cities are faced with unlimited civic obligations and limited revenue options. To remain competitive in the world economy and maintain the Canadian standard of living, it is imperative that the Government of Canada implement revenue sharing options to secure long term infrastructure funding for municipalities.

I think that states the case very well.

Further to this, besides the calls from local politicians in my area, the TD Bank Financial Group, the Conference Board of Canada, and the Province of Alberta's Future Summit have released reports in which infrastructure was identified as the most significant issue facing Canadian cities. In fact, the TD Financial Group stated in April 2002:

Canadian cities are beginning to show severe signs of strain after decades of rapid economic and population growth. In many cities, water systems, sewers, and public transportation all require massive new investment, but cash strapped municipalities--who have been asked to take over a growing number of responsibilities from the federal and provincial government in recent years--are in no position to deliver.

I would like to turn to the position of the federal government up to this point. On February 19, 2003, I questioned the finance minister and stated:

Each year Ottawa collects $4.5 billion in gas taxes, but only 5% of that money is returned to Canadians in the form of federal highway funding. The government is ripping off Canadians at the gas pump and not returning benefits to them... The current situation is completely unacceptable to all Canadians. The government has a choice to make, either it dedicates a portion of the federal fuel tax or it transfers the tax to the provinces to allow them to make the funding decisions to address their infrastructure needs.

I asked if the Minister of Finance would consider vacating a portion of the federal gas tax on provinces to allow the provinces room to address their infrastructure needs. The response I received from the Minister of Finance was very clear, “No, absolutely not”. He then went on to state:

Responsibility that the provinces have for areas which are in their jurisdiction is one for which they have entirely the same capacity to raise revenue as does the federal government. Our revenue goes into the consolidated revenue fund and we make choices as to how to spend it.

The Canadian Alliance tried to address this situation. We tried to be a responsible opposition party by putting forward a motion in June which stated:

That, in the opinion of this House, Canada's infrastructure needs should be met by a regime of stable funding; and that accordingly, this House call on the government to reduce federal gasoline taxes conditional on an agreement with provinces that, with the creation of this tax room, provinces would introduce a special tax to fund infrastructure in provincial and municipal jurisdictions.

This would have addressed the infrastructure needs in Edmonton and Leduc and other communities across this country. Unfortunately, this motion was defeated by the Liberals with 180 nays and 35 yeas, obviously Canadian Alliance members, and 14 members paired. For those who are viewing this debate today, paired members are those members who do not show up to vote.

It is interesting to note who was a paired member that day. One of the members who was paired was the member for LaSalle--Émard. It is interesting to note that this is one of the primary issues for the new Liberal leader. In fact, he did not even make an effort at that time to come into the House and express a view on whether we should have stable infrastructure funding. Frankly--

[The Deputy Speaker]

Order, please. The Chair wants to caution the hon. member that the longstanding practice here is for members not to reflect on a vote or to make reference to the absence of members. I would ask the member for his cooperation in terms of past votes in the House. It is an area that is causing the Chair a tremendous amount of discomfort. I know the subject matter is an important one. I simply seek his cooperation.

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

Mr. Speaker, in my view if members want to make gasoline taxes and the transfer of funds to municipalities for their infrastructure a main program of their future plan, and they consider it important, they should address that issue fully. I will address it that way. Viewers can read Hansard and check the record, and see who thought it was important.

I would like to address the issue of gasoline taxes. A lot of Canadians have contacted my office and complained about gasoline prices, but what they should really be complaining about in this country is gasoline taxes.

At the provincial level, gasoline taxes have risen representing anywhere from 35% to 51% of the gas price. If we compared this on an international level it is about the second lowest in the world. The price at the pump with taxes is about 10¢ a litre higher than gasoline in the U.S. Canada is the second lowest. Gasoline here is 10¢ a litre higher primarily because of gasoline taxes. The frustration is that these gasoline taxes are not going toward addressing what they are specifically designed for which is the infrastructure needs in our communities.

In 1995 the new Liberal leader introduced the federal gasoline tax. He increased it from 8.5¢ to 10¢ a litre as a deficit reduction measure. There is a major problem with this measure. It was introduced temporarily as a deficit reduction measure. The federal deficit was eliminated six years ago, but the tax remains. This is simply wrong. We must address the infrastructure needs of our communities across this country.

I call on the government to support the Canadian Alliance motion and initiate immediate discussions with the provinces so that we can address our infrastructure needs through existing taxes without increasing the burden of taxation that Canadians already have.

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, I have one question. The revenue collected from the gas tax is roughly $4.8 billion, I believe. When we consider all the municipalities across the country that presumably should be eligible to benefit, I wonder if the member has a comment on what would be an appropriate minimum level of support for a municipality that could demonstrate a legitimate infrastructure need or appropriate other activity.

My concern is whether there would be some haves and have nots. Would it be diluted if we simply restricted it to gas taxes such that certain municipalities maybe would not get enough money to make any significant impact on their ability to improve the quality of services for the community?

It is a question in terms of sharing the taxes. I do not know how much it would be suggested that we share in terms of a round, ballpark number, but it seems to me that if we spread it across the country every municipality will have its hand out with a valid program. How much does the member believe that might cost? Would it be distributed in a fashion so as to make sure that any application would get an amount of money meaningful enough to make a difference?

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

Mr. Speaker, I am not sure I entirely understand the question. The member is free to ask a supplementary if I do not address it.

Frankly, this motion is general enough that it allows for discussions with the provinces and municipalities to occur. Obviously they would have to identify their priorities in terms of the funding. Would every project be funded? I think it is safe to assume that not every one would be. There obviously would have to be an introduction of priorities.

The question of how much was asked. The member talked about the federal government raising about $4.8 billion in gasoline taxes. The Canadian Automobile Association and the Canadian Taxpayers Federation have pointed out that less than 5% of this is returned to Canadians in the form of federal highway funding, yet if we look at the provincial governments such as Nova Scotia's, for instance, it collects about $215 million annually from fuel taxes and its annual budget for highways is $180 million, or 83% of its fuel tax budget.

So I think we could certainly move from a 5% figure. If we moved substantively closer toward a 75% to 80% figure, I would certainly be happy with that; frankly, I think if we did that it would go to addressing the major infrastructure needs in communities all across Canada.

[Charlie Penson, Canadian Alliance, Peace River, AB]

Mr. Speaker, I will direct a question to my colleague. My understanding of the rationale here is that the federal government would back out of this area of excise tax on gasoline, which would allow the provinces to pick up that tax, if they wanted to, in order to provide money for the municipalities. Doing so would respect the constitutional jurisdiction of the provinces, where money would not be transferred directly from the federal government to the municipalities. The intent would be that by the federal government backing out of the excise tax area the provinces would have an extra source of money in order to fund the municipalities in terms of infrastructure.

Does my colleague agree that it is important to respect this aspect of it in order to provide the municipalities with a source of funding?

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

Mr. Speaker, my colleague makes a very important point, which is that municipalities very much come under provincial constitutional jurisdiction. Constitutionally, they are creatures of the provinces, as we know, so it is important for the federal government to respect provincial jurisdiction here.

Obviously the way we would like to see it work is that the federal government would negotiate with the provinces, vacate that tax room and allow the provinces to then discuss it with the municipalities. As for the way it would work in practice, if the federal government vacates from Alberta, in the Peace River area where the member is from, or in the Edmonton-Leduc area where I am from, obviously the people in Leduc and Edmonton and Peace River know their infrastructure priorities better than 301 members of Parliament or the bureaucrats in Ottawa.

So in practice the way it would work is that the federal government would vacate it and negotiate it with the province. Hopefully the entire tax room would be used for infrastructure, but if it were felt that all the needs could be addressed and the citizens of the province could be given a tax cut, that ultimately would be up to each province to determine.

Business of the House

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, discussions have taken place between all parties as well as the member for Calgary Centre concerning the taking of the division on P-15 scheduled at the conclusion of private members' business later this day, and I believe you would find consent for the following motion. I move:

That at the conclusion of today's debate on P-15, all questions necessary to dispose of the motion be deemed put, a recorded division deemed requested and deferred to Wednesday, October 8, 2003, at the end of Government Orders.

[The Deputy Speaker]

The House has heard the terms of the motion. Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.