House of Commons Hansard #67 of the 37th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was budget.
David Collenette LiberalMinister of Transport
Mr. Speaker, pursuant to Standing Order 32(2) I have the honour to table, in both official languages, two copies of a document entitled “Straight Ahead: A Vision for Transportation in Canada”.
David Collenette LiberalMinister of Transport
moved for leave to introduce Bill C-26, an act to amend the Canada Transportation Act and the Railway Safety Act, to enact the VIA Rail Canada Act and to make consequential amendments to other acts.
(Motions deemed adopted, bill read the first time and printed)
Libby Davies NDP Vancouver East, BC
Mr. Speaker, I am pleased to rise in the House today to present a petition from thousands of people who live in the Ottawa and Montreal areas who are concerned about the desperate situation of Algerian refugees.
The petitioners call upon Parliament to immediately end the deportation of non-status Algerians, to re-establish the moratorium on deportations to Algeria, and to regularize the status of all non-status Algerians.
Janko Peric Liberal Cambridge, ON
Mr. Speaker, pursuant to Standing Order 36 I have the privilege to present to the House a petition from hundreds of concerned citizens from my riding of Cambridge. In Canada, one out of four children dies before birth from induced abortion. More than half of all Canadians agree that human life should be protected prior to birth and yet there is still no law protecting unborn children.
The petitioners pray and request that the Parliament of Canada enact legislation that would provide legal recognition and protection of children from fertilization to birth.
Reed Elley Canadian Alliance Nanaimo—Cowichan, BC
Mr. Speaker, pursuant to Standing Order 36 I would like to present two petitions from constituents in my riding in the greater Nanaimo area.
The first petition deals with the employment insurance program. The petitioners state that over $35 billion in unpaid insurance benefits have been taken out of the program by the federal government since it started the EI program and that in 1999 the EI program paid more money to the Department of Finance than it did to people who were unemployed.
The petitioners ask that Parliament enact legislation that would modernize the employment insurance program according to the plan proposed by the Canadian Labour Congress.
Reed Elley Canadian Alliance Nanaimo—Cowichan, BC
Mr. Speaker, the second petition deals with child pornography. It is signed by 43 petitioners asking that the House adequately address the problem of child pornography in Canada so that it would in no way, shape or form be legal at all.
Paul Szabo Liberal Mississauga South, ON
Mr. Speaker, I am pleased to present a petition signed by a number of Canadians, including in my own riding of Mississauga South, regarding stem cells.
The petitioners would like to bring to the attention of the House that Canadians do support ethical stem cell research, which has already shown encouraging potential to provide cures and therapies for the illnesses and diseases of Canadians. They point out that non-embryonic stem cells, also known as adult stem cells, have shown significant research progress without the immune rejection or ethical problems associated with embryonic stem cells.
The petitioners call upon Parliament to focus its legislative support on adult stem cell research to find those cures and therapies for Canadians.
Peter Goldring Canadian Alliance Edmonton Centre-East, AB
Mr. Speaker, I wish to present a petition put forth by many concerned Canadians. These petitioners ask the Prime Minister and the Minister of Justice to stop the exploitation of our children in child pornography. They demand that Parliament take all necessary steps to ensure that all materials that promote or glorify pedophilia with children be outlawed.
Bob Speller Liberal Haldimand—Norfolk—Brant, ON
Mr. Speaker, I rise under Standing Order 36 to present two petitions.
The first deals with Bill C-250. The petitioners call upon Parliament to protect the rights of Canadians to be free and share their religious beliefs without fear of prosecution.
Bob Speller Liberal Haldimand—Norfolk—Brant, ON
Mr. Speaker, the second petition deals with child pornography. The petitioners call upon Parliament to protect our children by taking all the necessary steps that are available to ensure that all materials which promote or glorify pedophilia are outlawed.
Geoff Regan LiberalParliamentary Secretary to the Leader of the Government in the House of Commons
Mr. Speaker, I ask that all questions be allowed to stand.
The House resumed from February 19 consideration of the motion that this House approves in general the budgetary policy of the government; of the amendment; and of the amendment to the amendment.
Jean Augustine LiberalSecretary of State (Multiculturalism) (Status of Women)
Mr. Speaker, I will be sharing my time with the member for Yukon.
As Secretary of State for Multiculturalism and the Status of Women, I would like to comment on the 2003 federal budget regarding its relevance for the realization of the objectives of the multiculturalism policy and how it will help to advance the status of women in Canada today and in the future.
A budget is more than a simple accounting of finances. It is the expression of a nation's values and priorities. It is a tool to protect and help build the kind of society Canadians value. It also recognizes that a secure society is the foundation for a strong economy.
Recognizing the critical link between social and economic policy, the 2003 budget contributes to building the Canada we want by emphasizing investments in individual Canadians, their families and communities.
This approach to building a better Canada by linking social and economic priorities was heralded in the 2002 Speech from the Throne when the government reaffirmed its commitment to helping children and families out of poverty, to building competitive cities and healthy communities, and attracting and retaining talent and investment from other parts of the world.
We feel that these priorities are of great importance to all Canadians and that the 2003 budget reflects the engagement of the Canadian government to their realization.
The federal budget presented by the Minister of Finance on February 19, 2003, features several elements which are of particular relevance for multiculturalism. These include: foreign credentials recognition, facilitating the economic integration of newcomers to Canada, the promotion of healthy communities and cities, and the celebration of all cultures and values. Of particular importance to women are initiatives in the areas of health care, poverty and affordable housing, making our communities more livable, support to aboriginal communities, and increases in international aid.
The first element concerns the financial support in the 2003 budget for expanding the skills of our labour force and helping all Canadians who want to work, including new Canadians, to apply their talents and initiatives to productive enterprise.
The government will invest considerable sums over the next few years to help new Canadians integrate quickly into our economy by providing more funding to second language skills, supporting faster recognition of foreign credentials and through pilot projects to attract skilled immigrants to smaller communities across the country.
Helping new Canadians integrate quickly into our economy, including the faster recognition of foreign credentials, directly affects immigrant women. At present, regardless of their educational qualifications, women wanting to enter Canada tend to be allowed in through temporary foreign worker programs that place them in low skilled, precarious employment situations--factors that increase their vulnerability to violence. Better recognition of skills earned abroad will provide immigrant women with the conditions they need for economic autonomy, access to opportunity, and a better quality of life.
The Department of Canadian Heritage, through the multiculturalism program, has worked in collaboration with Citizenship and Immigration Canada and Human Resources Development Canada on the issue of recognition of foreign credentials. I am very pleased to see what our collective efforts have achieved and will continue to achieve.
In this regard, the government will continue to work with its partners to break down the barriers to the recognition of foreign credentials and will fast track skilled workers entering Canada. It will also position Canada as a destination of choice for talented foreign students and skilled workers by more aggressively selecting and recruiting through universities and in key embassies abroad.
The second element that I wish to highlight concerns the investments the Government of Canada has announced for Canadian families and their communities. The Minister of Finance said:
Canada is a very prosperous country. But not all Canadians share in that prosperity. We may have tackled the fiscal deficit but we have not yet adequately addressed our social challenges.
Some of these challenges may have a greater impact on women, ethnoracial and ethnocultural communities, and on newer Canadians. Stronger, healthier communities reflect the government's commitment to social justice and contribute to enhanced social cohesion, both of which are cornerstones of the Canadian multiculturalism policy.
The 2003 budget will contribute to both improving quality of life for all Canadians, and easing the burden on some communities and families who may be facing particular challenges.
For example, the report on The Future of Health Care in Canada has stressed the importance of considering and involving ethnic communities and new Canadians in identifying needs and designing programs to meet those needs. By focusing and improving access to health care for all Canadians, the government is improving our capacity to work in partnership with communities across Canada to ensure that institutions and government services are responsive to the needs of ethnoracial and ethnocultural communities and newcomers to Canada.
High quality health care is a key priority for women who must often assume the caregiver role. This budget provides funding for primary care, home care, catastrophic drug coverage, and also invests in promoting the health of all Canadians, including diagnostic and medical equipment, health information technology and research hospitals.
I believe that funding directed at strengthening the quality of life in Canada's large urban centres can contribute directly to improving the outcomes for women as well as ethnoracial, ethnocultural and immigrant communities that represent a significant share of a city's population. In the budget, the government is making significant investments to address homelessness and increase affordable housing in Canada. Funds to enhance existing affordable housing agreements with the provinces and territories, and to extend the government's housing renovation program speak to this opportunity to improve quality of life in these cities.
The budget also demonstrates a commitment to families by increasing the national child benefit supplement which works to support low and modest income families, including sole support women-led families, in raising children. A new child disability benefit will provide significant additional assistance to low and modest income families raising a child with a disability. Initiatives in the budget also provide funding for child care and early learning.
We have expanded the employment insurance program to allow for compassionate family care benefits for those who must look after gravely ill and dying family members such as a child, parent or spouse. Again, this responsibility often falls on the shoulders of women.
The budget continues to offer support to aboriginal communities in Canada by investing in health and water quality issues, and in the first nations policing program, which will have positive benefits for aboriginal women who are victims of violence.
Added funding for the national aboriginal achievement foundation to expand scholarships for aboriginal students will widen opportunities for aboriginal youth, including young aboriginal women who remain among our society's most vulnerable and least advantaged members.
The government's commitment to education and excellence in post-secondary education is reinforced by its investment in the Canada student loans program.
I also want to draw attention to the investments we have made in the promotion of Canadian culture and values. I think all of those speak to the commitment that we have on this side of the House to relieving a number of problems facing women and multicultural communities. The items in the budget, which speak to values, cultures and international aid, are all helping to advance the status of women and to strengthen Canadian multiculturalism.
I encourage and ask all members to support these items as presented in the budget.
Larry Bagnell Liberal Yukon, YT
Mr. Speaker, I am delighted to rise today to speak to the budget, especially in relation to my riding in northern Canada.
I am delighted at the number of references in the budget to northern Canada, and I will mention those in my speech today. I have about 25 points but I will go through as many as I can.
The first item, which I am delighted to see in the budget and for which I lobbied hard, is the extension of support to the communities partnership initiative. This is the homeless initiative that was so popular across the nation. In Yukon in particular we had some very unique and innovative projects with an excellent local committee. It had more work to do and wanted the initiative extended for three years.
I was also happy to see $175 million for federal abandoned contaminated sites. It referred specifically to northern mine sites. We have some abandoned mines in northern Canada that have to be cleaned up. The Yukon salmon committee, for instance, asked me to pursue this, which I did. Therefore I am delighted to see that there is a fund to start working on these high risk sites in Canada.
I am sure we are all very happy about the excise tax exemption on bio-diesel fuel and other provisions to help the atmosphere.
The ongoing schedule of the biggest tax cut in history of $100 billion for personal and corporate taxes continues. Many people are quite happy with that.
One of the tax cuts that will have a great effect in the north is the cut in the resource tax rate from 28% to 21% over five years. The north has a very resource based economy and this should be helpful. Throughout history the biggest economic sector in Yukon has been mining. The above reduction, the deduction in the mine royalties tax and a new tax credit for eligible mineral exploration will all help the sector that has been most important to Yukon over the years.
The other type of mining in Yukon is gold placer mining which needs our support. It is the second largest private sector employer at the moment in the Yukon. In fact, it also attracts people to our largest sector which is tourism. Therefore it is very important that we provide our support for that.
The funding formula in the territories is unique in that if we lose revenues the funding formula from the federal government tops it up. If the Yukon government loses income tax revenues for instance, it is topped up. Therefore it is very important that we do not lose revenues from placer mining or any other sector because there is a major cost of millions of dollars to the federal government to replenish that.
We need economic stimulation in Yukon. With the third highest unemployment rate at the present time, we look forward to any future provisions to help the economy. I am delighted the government sent a team to Yukon and British Columbia to check the great potential megaproject of a railway from Alaska through Yukon and through B.C., which would be a very exciting project.
The $3 billion for infrastructure will go a long way toward economic development. The three northern territories have always talked about how important basic infrastructure is to the development of their economies. The $2 billion is an addition to the strategic infrastructure fund, plus $1 billion over 10 years for municipal infrastructure.
Something else that I was delighted to see, which specifically relates to the north, was the $32 million fund for the environmental and regulatory framework for the northern gas pipelines. The Alaska gas pipeline, which is one of the two, would be the largest such project in the history of the world. There will be huge benefits of hundreds of thousands of person years right across Canada.
We are also happy to see the skilled immigrants to rural areas initiative because we would like to access those skilled workers. People have known for years that a large majority of immigrants go to Montreal, Toronto and Vancouver.
I have been approached over the years on issues relating to child care. I am delighted to see $935 million in child care contributions and $35 million for aboriginal early learning and child care. We have a program in the Yukon called Head Start which has been exceptionally successful. I am constantly requested to get more money into that program because other new sites would like the successes of the communities that have used it. I am delighted to see that money because I have been asking for that for a long time.
Health care is the number one issue for Yukoners. We are delighted with the whole health care accord and the improvements. In the new areas, who can argue with drug assistance, better access to primary care and to home care? However we do have some problems that are unique and specific to the north, one being the recruitment of professionals. Therefore the human resource strategy should be very helpful to us.
The biggest thing Yukoners brought to me relating to health care was waiting lists. We are sort of hostage to the B.C. and Alberta system for waiting lists for major surgery and specialists. We are delighted that the new system put in place will reduce those lists.
The $1.3 billion in health care for first nations and Inuit people is very important to my riding. I worked on some issues in that area last summer so I am very happy to see that funding. Both in this budget and the last budget, I compliment both finance ministers on maintaining the $250 million green funds for the Federation of Canadian Municipalities. It has been an excellent program and I have always encouraged that it be continued.
Many Yukoners are in post-secondary educational institutions right across Canada so I am delighted to see the 2,000 new post-graduate degrees for master's and another 2,000 for doctorates. It is expensive enough for our students to survive the distance they have to go.
Another area, which specifically relates to the north and which I was once again delighted to see, is the $16 million for northern science research. This year the industry committee held hearings relating to how the granting councils distributed their large quantities of funding. During those hearings I was constantly lobbying for more money for the north. I was delighted and excited that the budget stated:
The granting councils will also be asked to enhance their support for northern research as part of the increased funding they receive in this budget.
For small businesses, people who are not on government pensions, an increase in RRSP contributions will allow them to take more control of funding their own old age security. There are lots of provisions to help small business. Small business is very important in my riding. They will now be allowed to keep their low 12% tax rate, up to $300,000 from $200,000, and the capital tax has been eliminated, which many businesses had requested.
I was also asked before the budget for money for national parks. There are some beautiful national parks in Yukon and I hope everyone will visit. There was $74 million and I am sure more to come in future years for not only the creation of 10 new parks and 5 marine areas, but in maintaining the biological integrity of the existing parks.
As chair of the foreign affairs and defence caucus I am happy to see the increased money for defence, for trade promotion in the United States and a doubling of international aid by 2010. Many Yukoners support international aid.
I am happy to see the increase in support for the military and coast guard, but with a caveat, of course, that some of that go toward protecting Canadian sovereignty in the north especially with the melting and opening of the Northwest Passage.
The national child benefit having gone up over 100% since 1996 is a great effort to reduce poverty. I only have one minute left but I want to mention all the items for aboriginal people, post-secondary education, water and waste water, aboriginal skills and training, money for the northern gas pipeline training first nations people, the urban aboriginal strategy and Aboriginal Business Canada at $20 million.
I am happy about the immunization strategy. My constituents have asked about that. I am also happy about the child disability benefit, the five year action plan for official languages for Association franco-yukonnaise, the money for historic places and the venture capital for BDC which will be important in my riding.
Climate change is important but it is more important in the north. We depend upon ice bridges for our economy. A lot of our permafrost affects our sewers and buildings. The budget contains $50 million for studying and research and it says specifically relating to northern Canada: $2 billion for things like wind energy--we have windmills in the north--alternative energies and fuels.
Paul Forseth Canadian Alliance New Westminster—Coquitlam—Burnaby, BC
Mr. Speaker, it was interesting to listen to the number of nice to haves on the spending list. That certainly is a characterization of this budget. It looks like it was a Christmas shopping list coming a little late.
However there is an underlying, very worrying principle that I want the member to address. The increase in spending projected over the next three years is larger than any of the most optimistic increases in the development of the economy. When a future plan for a nation is laid out where the government will continue to tax at high levels and increasingly spend at greater and greater levels, faster than the economy can ever grow, that means that we are not in wise hands and we are going to get into great difficulty.
It is the old adage: the government taxes too much, therefore winds up spending too much and we still owe too much.
On the calculation of the national debt it is interesting to see that there has been a little correction. Somehow the national debt calculation has been revised by just a mere $27 billion. That certainly affects the overall debt to GDP ratio. One wonders what happened with the bookkeeping when $27 billion is misplaced somewhere.
How wise is it to increase spending each year far beyond what the economy will grow? That certainly is heading for trouble as far as I am concerned and I do not see anything in the budget to address it.
Larry Bagnell Liberal Yukon, YT
Mr. Speaker, I would disagree with the member's assertion that the spending comes too late. It is only because of our prudent fiscal management over the years. When we did have a large deficit it restricted our ability to fund. We were spending money on interest and deficit payments.
Now that the deficit has been eliminated, we have the ability to provide the biggest tax cut in history of $100 billion, which, as I said, is continuing on. It also allows us to invest in programs for aboriginal people; to increase the disability tax credit for people with disabilities; and to invest in health care.
I am not sure on which items the member has suggested we might be overspending. Is it on health care? Is it the money for people with disabilities? Is it the investment in the tax cuts? Is it the investment in the infrastructure? Is it the investment in the military? I am not sure which one he is referring to.
In spite of the fact that we are helping in all these very needy areas, we also have huge tax reductions and contributions to pay off the national debt. I agree with the member fully that we should be doing as much as we can to pay the national debt, but in the 2003 calender year we will be reducing the personal income tax by $18 billion, corporate income tax by $2.5 billion and employment insurance by $3.6 billion. In the following year of 2004, the increases are even more dramatic: $22 billion in personal income tax; $3.7 billion in corporate income tax and $4.4 billion in employment insurance.
I think it is very balanced and this is what I have heard from many people. It has spending. It has serious tax reductions, especially for my riding, in the resource sector, in mining and in small business. It has provisions for contingency and provisions to pay down the national debt from the funds that remain.
Pauline Picard Bloc Drummond, QC
Mr. Speaker, there has been so much criticism of the budget since it was read last week that I will rise today to add my voice to the voices of other Quebeckers who have found nothing in it to help them.
The Minister of Finance's budget was a spectacular non-event. The former finance minister took pleasure in underestimating revenues and overestimating expenditures. He took pleasure in finding pretexts to conceal billions of dollars in surplus funds. This was how he kept those billions from being debated in the House in connection with the priorities for improving taxpayers' quality of life.
The minister who replaced him is not doing much better. Journalists and analysts everywhere in the country have not had much good to say about the budget plan. Government MPs are often quick to say, “We all know the opposition is opposed to everything”, but this time I think all of the political analysts are unanimous in the verdict that all this is nothing but a big showy fireworks display, made up of thousands of little squibs exploding in every direction.
It has even been described as a Liberal symphony in the key of S major, S for spending that is. There is nothing surprising about that, considering the orchestra leader's propensity for waving his baton indiscriminately over every section of the orchestra, every possible and imaginable social program.
The Minister of Finance's behaviour is proof that this government had no priorities, but rather a single-minded ongoing objective to increase its visibility, even if this means callously ignoring the provinces and continuing to interfere in areas of provincial jurisdiction. Under this Liberal government, Canada continues to be built without consideration for the provinces. This is known as wall to wall “nation building”.
Furthermore, that is what we will remember as the undying legacy of this Prime Minister, who is on his way out and who, for over a decade, has accumulated staggering surpluses at the taxpayers' expense. We must also point out that, under the Liberals, fighting between Ottawa and the provinces has increased.
The Prime Minister has never hesitated to interfere in provincial jurisdiction, creating perpetual trouble for provincial governments. This budget, the first for the current Minister of Finance, stays the course and continues to perpetuate the Liberals' bad habits.
I will give a few examples of encroachment on provincial jurisdiction. First, the government created the Canadian Coordinating Office for Health Technology Assessment, which provides for an integrated Canadian strategy on new technologies. On numerous occasions, we have pointed out that health care and education are provincial responsibilities.
The allocation of additional funding to the Canada Student Loan Program is another example. Once again, education is a provincial responsibility. The Canadian Learning Institute was created. What is the federal government doing sticking its nose in learning?
These examples prove that this government has continued with its centralizing, pan-Canadian vision.
Last week, the government began a vast seduction campaign. The amounts involved are huge and so is the number of initiatives affected. This government and its members are focusing on the big bucks they have announced in this budget. Of course, it amounts to billions of dollars, but when it becomes $3 billion over 10 years divided by 10 provinces and 3 territories, that amount is substantially less at year-end, about $300 million or less for the provinces and territories.
The amounts are huge but divided over several years. Who can say whether the next Prime Minister and the next Minister of Finance will keep the promises contained in this budget?
The government—and even the Minister of Intergovernmental Affairs—has already denounced the fact that the Conference Board, which reviewed the fiscal imbalance between the provinces, projected some figures over a ten-year period. The ministers and government members laughed at this so-called hypothesis.
Now we are led to believe that there is $3 billion available over the next ten years. Talk about speaking from both sides of your mouth.
The investment announced for infrastructure speaks volumes. I will give the example again: $3 billion over ten years, or $300 million a year; $300 million for the ten provinces and three territories is very little.
I would like to quote one of my constituents, the president of the Union des municipalités du Québec and Mayor of Drummondville, Francine Ruest-Jutras who said,
The budget plans for $3 billion over ten years to improve existing infrastructure, of which only $1 billion is earmarked for municipal infrastructure—
I should point out that $1 billion is paid directly to the municipalities, yet as we see it, municipalities are provincial entities. The federal, central government has no authority to pay the municipalities directly. It has to go through the provinces.
Ms. Ruest-Jutras continues:
—$1 billion is earmarked for municipal infrastructure in the entire country. By the time this is divvied up there is only $25 million a year left over to upgrade the water supply, sewers and highways in Quebec. This clearly is not enough given that Quebec's needs add up to more than $1 billion a year for 15 years.
The cost for upgrading the water supply, sewers and highways in Quebec has been estimated at $1 billion a year for 15 years and we are told we will be given an extra $25 million.
The statements made by Ms. Ruest-Jutras, the Mayor of Drummondville, who is known for her enthusiasm for economic development, proves that this government does not listen to the needs of the public.
The $2 billion that will be made available for strategic infrastructure will again be divided among the ten provinces and the three territories; that does not leave much for Quebec either. Note that only one kilometre of highway costs $1 million. This will not go very far.
When he rises in the House, the Minister of Finance keeps saying that his government has reduced taxes by billions of dollars over the past few years. The minister is neglecting to say that if direct taxes have been cut, indirect taxes are taking up the slack.
Think of the current cost of heating oil and gasoline. These are indirect taxes. If there is one such tax that I want to mention, it is the gasoline tax. The government gets 1.5¢ per litre to pay down the deficit, when there has not been a deficit for four years now. Where is this money going? Eliminating this tax would help the taxpayers who need to put gas in their cars to go to work.
But no, this government prefers to sock away the surplus and take precautionary and preventive measures. The little that remains is spread all over the map, over a period of five or ten years. It seems like tonnes of money but, in reality, it is just crumbs.
The Bloc Quebecois has condemned on numerous occasions the fiscal imbalance between Ottawa and the provinces. From one end of the country to the other, all the provinces, all the premiers, as well as economists, associations and federations, notice the fiscal imbalance between the central government and the provinces, and they also notice that the federal government is collecting more money than it needs for its operations.
This government is the only one to deny the existence of fiscal imbalance and to lay the blame on the provinces. There are all manner of justifications given for this. How can it be that everyone, political analysts, economists, all stakeholders, provincial premiers, finance ministers, the official opposition and all parties in opposition, can see a fiscal imbalance while the government closes its eyes and denies its very existence? That is something to think about.
As far as the federal strategy on fiscal imbalance is concerned, I have already said that the government continues to underestimate its revenues. For the next two years, I should point out that the figure being talked about is more than $14 billion, maybe as much as $20 billion. These amounts are being concealed from the public so as to avoid debate and to make it possible to have a budget where a few crumbs are tossed to everyone, in the belief that this will enhance visibility. But rest assured, the voters and the taxpayers are not taken in.
The proposed capital tax measure is one illustration of fiscal imbalance because it allows us to see the disproportion between the means available to the federal level and to Quebec and the other provinces. At the present time, Quebec has a plan to reduce its capital tax, which will enable it to halve the contribution rate by 2007. The federal government is announcing it will do so now. This shows the disproportion between the two levels of government.
As well, there was an expectation that the Minister of Finance would put an end to the theft from the employment insurance fund, this method of virtual accounting which lets him get his hands on the contents of the fund. We are now being told that the Minister of Finance has merely said he would consult. Maybe a committee or board will be created, and it will set the contribution rate. This will happen within two years.
According to calculations, the surplus this year and next in the EI fund will be between $3 billion and $4 billion. This is money the minister will siphon off into his coffers, thus creating imbalance. This accounting method lacks transparency.
Remember that the employment insurance fund is insurance for people who are unemployed. The current government no longer contributes money to the fund and is not entitled to use the surplus from it for all sorts of sketchy reasons. The budget does not establish an independent fund. The Bloc has been asking for an independent employment insurance fund for a long time.
The Prime Minister, the former Minister of Finance who wants to replace him, and the member for Ottawa South are all the same. It seems like for the past ten years they have all had the same speech writer. I wonder which one of them does the dictating.
The Minister of Finance is not even embarrassed. I asked him why, when we have such large surpluses, the government continues to help itself to a fund belonging to workers.
The same taxpayer who contributes to the employment insurance fund has also been paying a special gasoline tax since 1995 in order to reduce the deficit.
In less than 18 months, the cost of heating oil has gone from 39 cents to 62 cents a litre. Remember that often the people who use oil to heat their homes are seniors. These are people who receive a meagre pension which the federal government has never indexed. It has no wish to do so and has not made it a priority. And it leaves these people to continue paying 62 cents a litre for heating oil.
Soon these people who are living on the brink of poverty—because we know very well that the federal pension now falls below the poverty line—will have to choose between heating or eating. Is that right when the government currently has a huge surplus?
The Liberal government's insensitivity to ordinary Canadians, as the Minister of Finance called them, has produced, today yet again, terrible results. I am talking about people from a plant in my riding who will lose their jobs next month due to the softwood lumber crisis. These 130 employees, 130 households, will fall victim to the government's failure to support this industry. These 130 unemployed will join the 7,000 Quebeckers directly affected by this crisis.
The Prime Minister wanted to leave a legacy, but it will be a sorry one. What about the government's attitude to the disabled and their families? The government rattles on forever about its enormous investments, but it neglects to mention that it has made their lives difficult. We have condemned the unfairness of the eligibility criteria for the disability tax credit. Since this strategy did not work, the government dreamed up another and announced the creation of a committee to do its work for it. Let us face it, this announcement goes against a motion that was passed unanimously by the House last November.
This is further proof that this government is incapable of respecting not only its commitments, but also the work of parliamentarians and the population.
You have not heard the last about the board it wants to create for the disabled to establish eligibility criteria. This board would decide if the disabled are entitled to the disability tax credit due to their physical condition, or if parents are entitled to the tax credit for their child. This is unacceptable. Who do they think they are to judge those who are already suffering?
We have before us a government which has been hard hit by scandal and corruption and which is trying to cover up by playing Santa Claus. It is having to face harsh reality. This budget does not meet the demands the Bloc Quebecois made over the past few months, nor the needs of Quebeckers. There is nothing in this budget to resolve the fiscal imbalance, but a series of measures and programs showing the government's determination to centralize and homogenize everything.
This is an unacceptable approach and one that is inadequate for all provinces. There is nothing in this budget to address the lack of transparency relating to the EI fund. Nor anything about doing away with the gas tax. There is virtually nothing concrete on infrastructure, and we must not forget this government's refusal to implement the Kyoto protocol in a way that is fair and respectful for Quebec.
When the minister stated in his speech that public funds in Canada will be administered with greater transparency, not many people were convinced of it.
There is one solution left, however. For all those who have been ignored, be they women, aboriginal people, victims of the softwood lumber dispute, self-employed workers, or microbreweries, there is one real change still on the horizon. For Quebeckers there is but one way to envisage a different future, and that is sovereignty.
Peter Adams Liberal Peterborough, ON
Mr. Speaker, I listened with interest to what my colleague had to say. I know she has a great interest in EI, the employment insurance. I was pleased to see that the premiums came down for the 10th year. I understand her other arguments about the fund but did she take into consideration some of the additional expenditures from the fund which have occurred in recent years?
As members know, employment insurance is what it says. When people are unemployed, it gives them time to move between jobs. That is very important. The fund also supports the disability pensions which unfortunately any of us could find ourselves drawing on at any time in our careers. It is not a matter of being unemployed but a matter of being disabled.
However in recent years I have noticed two developments which involve costs based on EI premiums. One is the parental leave and parental leave extension, which I supported very strongly. It allows the parents of a child a considerable period of time, using the EI fund to support them. What does she think of that? It is an additional expenditure from the fund.
In this budget allowance was made for caregiver leave, the so-called palliative leave. This will also be paid from the funds which are gathered through the EI program. My understanding is that it is up to a month of leave for looking after someone who is terminally ill. This is something that I support very much.
What does the member think of these two additional expenditures from the EI fund in recent years, parental leave and palliative leave?
Pauline Picard Bloc Drummond, QC
Mr. Speaker, I would like to point out something to the hon. member about the 20¢ cut. Yes, it went from $2.10 to $1.98, but in actual fact this budget actually cut only 2¢, because a 20¢ cut had already been announced in last year's budget.
There is nothing here to brag about. This is just one more way to deflect the question and not to be transparent. The 20¢ cut was announced last year, and so the cut this year is only 2¢.
The hon. member seems to fail to see that, after the EI program expenditures are taken out of the fund, there is still a forecast surplus of $3 billion, and another $3 next year. Since this virtual accounting practice was inaugurated, $46 billion have been transferred to reduce the debt. Money has been taken from the EI fund, and the government is not even trying to hide the fact.
I would also like to point out to the hon. member that the government contributes nothing to the employment insurance fund. It is taxpayers' money the government is managing. The government does not contribute a dime. It is employers and workers who contribute. The government takes the surpluses and uses them to create prudence funds, diverse funds and trusts. Trusts are untouchable.
These measures do not make sense. Unions and employers are exasperated by the misappropriation of the employment insurance fund. They are denouncing this situation and asking the government to stop helping itself to the fund. They are asking that the premiums be set by the contributors, that is, the employees and the employers.
The agency that set the rates was disbanded because it said it did not make sense to do things this way. It said the rates were too high compared to expenditures. The government ploughed right ahead.
Currently, because everyone is denouncing the siphoning off of the employment insurance fund, the government is trying to be more transparent. The minister has made a promise not for this year or next year, but for the more distant future.
There will be broad consultations. It is a typical priority of this government to consult so that people will forget everything. But they had better not keep trying to dupe the taxpayers, who are fed up with the government skimming from the EI fund.
Bryon Wilfert LiberalParliamentary Secretary to the Minister of Finance
Mr. Speaker, the member talked a lot about provincial jurisdiction. I am somewhat confused as to what she determines as provincial.
On one hand she talks about the Canada graduate scholarships, which is not an intrusion of provincial jurisdiction, certainly not in terms of education because the money goes directly to students.
On the other hand, she says that there is not enough money for infrastructure, which is not true. It is a revelation to me that the Bloc is supportive of the national infrastructure program. For years the Government of Quebec was very negative with regard to the position of the UMQ on the issue of support for municipal infrastructure.
At the same time the member talks about gasoline pricing which is a provincial jurisdiction. In fact, as we all know, in March 2000 the government suggested that we suspend the GST on gasoline for a period of time and only one province bothered to respond. In terms of also suspending the PST, the Province of Quebec was not one of the respondents.
I have pointed out what I think is a clear contradiction in her views with regard to education on the one hand and infrastructure and gasoline on the other hand. I would be interested in her comments.
Pauline Picard Bloc Drummond, QC
Mr. Speaker, instead of saying my speech was contradictory, the hon. member should perhaps consider transparency. I understand that the parliamentary secretary wants to defend the Minister of Finance, but I do not see the contradiction in what I have just said.
Everything I said was verified and supported by Canadian business federations, Quebec and Canadian associations and economic analysts. The parliamentary secretary needs to read the newspapers to see the reactions to this budget.
We have been told, and this is an insult, that there is enough money in infrastructure; $3 billion, when Quebec alone needs $1 billion over 15 years. The chair of the Union des municipalités du Québec says that $1 billion per year for 15 years is needed for infrastructure. We have been told that there is enough and that everyone is happy.
I have not seen any analysts, any chairs of a Canadian federation representing municipalities boast that only $3 billion has been invested. The mayor of Toronto—outside Quebec—condemned the economic shortfall for infrastructure. The amount he will get will not even pay for the work needed on one street in his city.
I have been told that there is a contradiction in terms of the gasoline tax; this is a special gas tax to fight the deficit. Where was the parliamentary secretary when this special tax was created to reduce the deficit? There has not been a deficit for four years now. This fact is never mentioned, and the government boasts about having a balanced budget. Why keep this gasoline tax, when people are struggling to pay for gasoline and heating oil.
We could also have had a debate on the fiscal imbalance. The parliamentary secretary did not talk about it, since this government prefers to shut its eyes and not speak of it. The government is the only one that continues to deny the fiscal imbalance.
Tony Valeri Liberal Stoney Creek, ON
Mr. Speaker, I will be sharing my time with the member for Etobicoke North.
This morning as I sat here I heard many members talk about the various aspects of the budget, such as EI, health care and infrastructure. I would like to focus a bit on what the budget actually does to make Canada competitive in North America and globally and to ensure that Canada remains a strong voice in the world.
The Minister of Finance talked about the concept of turning Canada into a northern tiger, a magnet for global investment attracting the best in human capital. On the latter point I just want to make the comment that the best in human capital means that we need to continue to invest in our people. We need to invest in our human capital.
It also means that as a national government we need to pay attention to local organizations like the Industry-Education Council from my area, which for some time now has been promoting a trading model to assist our manufacturing sector and to ensure that Canada remains strong and vibrant in the area of skills and skills training. I think that as a national government we need to be very much aware of what some of the local areas are doing to put forward local solutions that can form a template, a model, for national solutions.
I think it is also important to mention this morning that the Canadian economy, as everyone knows, does not function in isolation. It is part of a continental economic base. The budget does paint a picture of a remarkably strong economy given the situation around the world. We have read about the job creation numbers in 2002, at 560,000 with the majority being full time. That is in contrast to what the U.S. economy has experienced recently. The unemployment rate in Canada is now about the same as the U.S. rate for the first time in 20 years. Interest rates remain at 40 year lows and we have had 3 years of current account surplus. It is a very positive picture of our particular circumstance.
It is also important to note that our net foreign debt as a percentage of GDP is falling, for the first time below that of the United States, and our Canadian economy is expanding quite well with a solid 3.3% in 2002, considerably faster than the 2.4% recorded by the United States. That is certainly faster than all other G-7 and G-8 countries, so I think we continue to move along quite well in terms of our economy.
However, the continuing uneven recovery in the United States certainly is a concern for a lot of our manufacturing sector and I think it should be a concern. We did see stabilizing late in 2001 in the U.S. equity markets but it again declined sharply in summer 2002 in the wake of Enron and other accounting and corporate scandals. It is worrisome, I think, and the point I want to make is that it is worrisome because of our level of economic integration.
We have taken some steps and that is the reason we have done as well as we have. Some of these steps have been very key in continuing to move our economy along. We have our existing tax reduction plan, which lowers the general rate of corporate tax from 28% to 21% in 2004. Again, with these cuts, the average federal-provincial corporate tax rate in Canada is below the average U.S. rate for the moment, although there now is a package in front of the president to deal with the U.S. tax situation. As for capital gains, again we are lower than the typical top tax rate in the United States.
We have also taken what I and many members in the House consider a welcome step in phasing out the capital tax, although I would suggest that some would like to see this move along more quickly than has been proposed in the budget. Phasing this out is a good step. I think it is also important to mention that this reduction and the gap created are unaffected by the recent tax changes proposed by the U.S., so this will remain an advantage for us, but I also think it is important to state that we cannot really stop there. If we are to become the true northern tiger, we need to maintain and expand this advantage.
Economic prosperity is certainly not just about taxation. It is about a lot of other things and I think this budget speaks to a lot of the other areas that we need to invest in to continue to move our economy along.
I want to take a few moments to speak about ensuring that we take a proactive and a mature approach to securing the long term Canada-U.S. trade flows that our economy is so dependent on. Certainly the importance of the border cannot be underestimated. This budget reaffirms support for the implementation of the Canada-U.S. 30 point smart border action plan. The plan enhances the security of the border and will facilitate the legitimate flow of people and goods, but I still believe that we can do more with respect to this issue.
I think that the Nexus fast lane program at our land borders needs to be expanded to air travellers. I know there are pilot projects, but we need to go beyond the pilots. The FAST program for commercial shipments, with its acronym meaning free and secure trade, was implemented in December 2002 and we need to look at it to ensure that it remains smooth. We also need to look at expanding the program beyond the six highest volume border crossings.
In fact, we need to place appropriate security measures without damaging our economic security, so it is really an approach to the relationship that we need to accept and adopt as parliamentarians and as a government. I look to a comment made by Carleton professor Michael Hart in a recent publication. When he talks about the differences in objectives, approach and rationale of a wide range of Canadian and American laws and regulations relating to both security and economic well-being, he puts the differences in these terms: very minor and, in most instances, unimportant.
If we want to ensure that our trade flows remain free flowing and that our economy continues to prosper as we continue to export to the United States, we should be focusing on a lot of these objectives and the approach and the rationale of a lot of the areas that deal with our economic and security issues. We should recognize that the differences are minor and we can deal with them. I am not suggesting that we harmonize our differences with the United States, but I am suggesting that we should aggressively pursue mutual recognition agreements that would simplify our border commerce while maintaining our democratic control. We need to ensure we do that to maintain our sovereignty. That is an issue a lot of people talk about when this comes up. We already have some mutual agreements in place. We have them for refugees and we have them for criminal justice. There are many we could look to as models.
The budget also commits $11 million over the next couple of years to bolster Canada's representation and trade promotion activities in the United States. That is a good step. We have to be cognizant of the fact that our other NAFTA partner, Mexico, has 43 offices in 19 states in contrast to the 13 offices that Canada has, including the embassy in Washington. We need to ensure that our profile and our presence in the United States are well resourced and well funded and I think the $11 million does move us in that direction.
On the broader discussion about Canada-U.S. relations, I talk about it as an underpinning to our budget and as an underpinning to our economic prosperity. We have policy choices in large measure because of the kind of export market we have with the Americans, with 87% of our exports going to the United States of America. I suggest that we continue with a step by step pragmatic approach. We need to expand on our successes. We need to expand on our smart border approach. We need to deal with mutual recognition agreements. Perhaps we need to consider the “tested once” approach in North America between Canada and the United States for a multitude of products. That would really allow the continued flow of goods. We also need to work toward increasing the free flow of persons across the border.
In closing, let me say that we need to engage in this debate. We need to understand that we have been successful in our economy because of our access to the United States in a North American market. We are a trading nation and we need to continue to trade. We need to ensure that we have access to that market so that we can continue to develop many other markets around the world.
Paul Forseth Canadian Alliance New Westminster—Coquitlam—Burnaby, BC
Mr. Speaker, in spite of the rosy approach over there, I am wondering if the member could respond to a couple of points.
The first is the understanding that internationally we are in a competitive market, especially as related to the United States and tax rates. As the American government continues to provide tax relief and relative tax rates for the individual taxpayer, Canada increasingly has become uncompetitive. Since our economies are so intertwined, we need to catch up to the Americans. Otherwise the brain drain is going to continue. What are the prospects for the continuing high income tax rates that we have in Canada as compared to those in the United States?
The other issue is that projected spending for the next three years is up significantly, perhaps by some 27%, which is way ahead of how the economy is going to grow, even in the most rosy of expectations. How wise is it to outline in a statement to the international community that we will continue to spend at increasing rates, rates beyond the wildest dreams of how our economy could ever grow?
Those are two worrisome signals that I think we are sending to the international community. Would the member like to respond to those matters?