Unfortunately, the member, should have continued.
Mr. Speaker, this morning, I will not necessarily be talking about the budget, which we are debating. Instead, I am going to talk about an amendment brought forward by my colleague, the hon. member for Drummond, which seeks to delete clause 64 on page 56 of the bill. This amendment reads as follows:
That Bill C-28 be amended by deleting Clause 64.
Everyone wants to know why clause 64 should be deleted.
It is due to a long-standing problem between school boards across the country and the Department of Finance. The school boards are entitled to claim 100% of input tax credits for student transportation under the Excise Tax Act, with respect to the goods and services tax and the harmonized sales tax, as they apply to school boards and the student transportation services they provide. This credit has existed for years.
The former Minister of Finance—now the frontrunner in the Liberal leadership race, I am talking about the member for LaSalle—Émard—decided to take this 100% credit and unilaterally cut it to 68%. Finally, the school boards protested by going to court.
On October 17, 2001, the Commission scolaire des Chênes won, unanimously, a ruling entitling Canadian school boards to 100% deductions. This deduction was authorized for all 415 school boards in the country, including the 72 in Quebec, 88 in Saskatchewan, 72 in Ontario, 7 in Nova Scotia, 60 in British Columbia and so on. So, all Canadian school boards were affected.
In a newspaper article on March 20, 2002, Gary Shaddock, president of the Canadian School Boards' Association, stated that this decision would cost approximately $150 million. This means that Canada would try to find a $150 million surplus within the school boards' budgets. This would have created a $150 million shortfall across the country.
Mr. Shaddock said:
The total financial impact for the federal government is not huge...but the impact for boards is significant.
In this same article, Mr. Shaddock states that the former Minister of Finance—and the new one, because this is in the new Minister of Finance's budget—was trying to sidestep a legal decision requiring that the federal government provide a 100% credit and that stated that government policy must not set aside court decisions.
That is exactly what clause 64 tries to do. The budget tells judges, “You did your job more or less well, and we do not like it. That is that”.
I would like to talk briefly about school boards in Quebec. André Caron, president of the Fédération des commissions scolaires du Québec, said recently that this was an abuse of the law and power.
By acting this way, the federal government will deprive Quebec school boards of significant financial resources used to organize busing for 650 students daily.
The fédération estimates the cost of the problem to be under $30 million. What kind of effect will this $30 million shortfall for Quebec's school boards have? They will have to increase school taxes for all parents of students in Quebec if they want to continue to provide an adequate busing system.
This is another method used by the federal government. It is pilfering millions of dollars from school boards, the EI fund, and everywhere. To do what? Perhaps to help out their friends and cronies. I do not know.
In closing, I have a letter from a large Montreal law firm, Stikeman Elliott. It is signed by a person whom I believe is a friend of yours, or someone you know quite well, the hon. Marc Lalonde, former Minister of Finance under the Trudeau government. He, too, is opposed to clause 64 in the budget, saying that it is unacceptable. I will read a few lines from Mr. Lalonde's letter. The former Minister of Finance, the member for LaSalle—Émard, said this:
However, the proposed amendment will not affect any case that has already been decided by the Federal Court.
That is what the then Minister of Finance, the hon. member for LaSalle—Émard, said in a release dated December 31, 2001, during the holiday break, so that nobody would notice. That is what he said, and it caused an uproar.
Mr. Lalonde had anticipated that reaction. Here is what he wrote the former Minister of Finance:
A man with your political experience can imagine the reaction of those school boards alienated in this matter.
I realize I have only two minutes remaining, and I think I will be able to complete my remarks. Here is another excerpt from Marc Lalonde's letter.
Once a final judgment had been handed down by the courts, every case thereafter should have been settled on the same basis. However, your department's legislative proposal would retroactively reverse such an arrangement. Needless to say that our clients feel that the Department of Finance is taking the attitude, “Heads, I win; tails, you lose”.
This is what Marc Lalonde wrote. I did not write these words. Marc Lalonde, a former Minister of Finance, did. I think that both the current Minister of Finance and his predecessor, the hon. member for LaSalle—Émard, should have paid attention.
Members can see why I am asking that the amendment put forward by my colleague, the hon. member for Drummondville, be accepted and that clause 64 be deleted.
I thank the House for this opportunity to speak on an issue dear to my heart, which concerns students throughout Canada.