Mr. Speaker, on February 20, I raised a question in question period expressing my concern with the federal government's unwillingness to respect provincial jurisdiction in its budget, which had been delivered a few days earlier. I noted that while there had been nationwide disappointment with the budget expressed by many provincial governments, opposition to the federal budget had been particularly clearly stated in the Quebec legislature.
The then minister of finance for Quebec, the leader of the ADQ and the finance critic for the Quebec Liberal Party, which was still at that point in opposition, all expressed their complete disapproval of the federal government's interference in provincial jurisdiction. At the time I wanted to know why the minister did not trust the provinces to administer programs for health, families, social housing and education.
The minister responsible for intergovernmental affairs gave a most unsatisfactory response to my question. I am here today to further question the federal government's infringement on the rights of the provinces to deliver social programs such as education.
Let me give a clear example of the kind of insensitivity to educational priorities that has been shown in this budget.
In Bill C-28, the budget implementation act, the federal government plans to retroactively amend the provisions of the Excise Tax Act relating to school bus transportation. This takes place after the federal government lost a test case in Quebec and was ordered by the courts to pay back GST paid by the schools for transportation. Astonishingly, the Liberal government's solution is not to simply pay the money that it owes to school boards, but instead the budget is pushing through a retroactive clause to justify a tax on local school funding that the courts have said is unlawful.
Technically speaking, the federal government may have a legal right to impose retroactive taxes on schools, but it goes without saying that there is no moral justification for this. Money that would have been used to educate our kids will now have to be diverted to the bottomless money pit known as the federal consolidated revenue fund.
This is not just a Quebec issue. In Eastern Ontario, the Upper Canada School Board will be particularly hard hit by this retroactive tax. This school board will be deprived of $2.59 million. That is $2.5 million that could have been used for school repairs, the hiring of more teachers, or for the replacement of infrastructure.
My fellow Ontario Alliance MP, the hon. member for Renfrew--Nipissing--Pembroke, has raised this issue in the House of Commons, poignantly stating the problem as well as the effects it will have on school districts in her riding. On May 12 she stated, and I quote:
The decision to grant only a partial GST exemption of 68% to school boards for the supply of transportation services has meant that school boards have had to pay millions of dollars in GST payments to the federal government instead of applying the funds to important educational requirements.
That applies to the Upper Canada School Board as well which is in my riding and it applies to school boards in many other parts of the country, particularly in Quebec where this test case took place.
Therefore I ask the parliamentary secretary this. How can she and her minister claim that the federal government is working, as he said in his response to my question in question period, cooperatively with provincial and local authorities when it refuses to even allow them to keep moneys that it owes to them under the law?