Madam Speaker, I am extremely grateful to the hon. member for Port Moody—Coquitlam—Port Coquitlam for his motion today. I am grateful for three reasons.
First, he is asking the House to address an extremely important issue. The state of this country's infrastructure is critical to the future of all Canadians. It affects our ability to work effectively, grow economically, compete internationally, and to live comfortably and safely. Whether we are speaking of the concrete that makes our roads and streets, or the glass fibre cables that connect our information highways, we are speaking of the infrastructure that helps Canada work. Anything that is that important to this country is extremely important to the government.
The second reason I am grateful to my hon. friend is that his motion makes a proposal that is not uncommon these days. More and more we are hearing suggestions for “simple solutions to the challenges facing infrastructure in Canada today”, suggestions such as the federal government should give up tax revenues to the provinces and cities, or the federal government should make more tax room for the provinces and cities. By addressing this suggestion today, we are very helpfully addressing an issue that has been on the minds of many commentators and pundits across the country.
The third reason I am grateful for this motion is it gives me the opportunity to explain two things. It allows me to explain why the hon. member's suggestion is not workable and it allows me to explain why the hon. member's suggestion is not necessary. These two points will comprise the substance of my remarks this afternoon.
First, why would it not work? Let us quickly review the motion. It suggests that the government:
--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.
If we were to read this motion carefully, we would realize that what we have here is no “simple solution” to the challenges of the infrastructure or any other problems. In fact, what we have here is a solution so complex and so intricate that to seriously suggest it is tantamount to suggesting a renegotiation of the Constitution.
Under the Constitution municipal revenue raising powers are derived from provincial powers. The provinces have access to all the major tax bases, including fuel taxes. The motion even acknowledges this provincial authority. Remember that it says “conditional on an agreement with the provinces”.
But let us look at what the motion does not say. Does it say by what proportion the federal government ought to reduce gasoline taxes? No. Does it say what proportion of this new kind of tax room would be allocated to provincial and municipal infrastructure expenditures? No. Does it envisage different needs in urban and rural areas? No.
How are we supposed to obtain the answers to these questions? I guess we will have to negotiate.
Clearly it is true that Ottawa and the provinces can come to agreement. They have done so in the past and they will do so again in the future, but to get 10 provincial leaders in the same room to agree on the same rate of tax to be spent on the same types of infrastructure programs, provincial and municipal, rural and urban, would be an astounding accomplishment. Add to these negotiations the voices and views of municipal leaders from across the country and suddenly the chances of finding a satisfactory resolution would surpass the astounding and transform into the miraculous.
There is, I dare say, a greater chance of Canada's parties of the right uniting under one banner than there is of this motion ever becoming a reality. That is how unrealistic it is. There is another reason the motion is unworkable and that has to do with the principles of good management and common sense, two key principles that guide the government. One of the hallmarks of the government has been its ability to put this country's fiscal house in order while at the same time targeting spending to the priority of Canadians.
This motion would help tie the hands of the government. Excise taxes on gasoline are an important source of general revenue for the government. Federal taxes, including gasoline taxes, go into the Consolidated Revenue Fund.
This fund finances a wide range of federal programs which benefit all Canadians, and which are important to them, such as old age pensions, national defence and transfer payments to provinces for health care and post-secondary education.
This motion essentially amounts to establishing a designated fund, something the government has always opposed.
Dedicating tax revenues to specific programs limits the flexibility of governments to respond to changing priorities and can result in some programs being overfunded while others suffer shortfalls. As well, making budgetary and long term investment decisions under a program funded by earmarked taxes is difficult as revenues from these taxes fluctuate from year to year.
The third reason for avoiding earmarking revenues to certain activities is that all potential spending initiatives, including infrastructure, should be evaluated independently of tax sources and examined as competing priorities.
Indeed, what if we did come to an agreement with the provinces, an agreement which I assure the House would only be realized after a good deal of blood, sweat and tears? What if, having lived with the agreement for a few years, we realized it was not enough or, what if, after 10 years or so we found that our provincial infrastructure funding pools were in surplus while other priorities were wanting? Would we ask the provinces to go back to the table for yet another round of negotiations? Such are the perils of earmarked funds such as the motion suggests.
As hon. members know, there are many demands today on government's scarce resources. Because of this it is important that the government remain firmly committed to sound financial management.
The government intends to continue to follow a balanced approach to managing the wide range of priorities and pressures it faces. I assure the House that a wide range of priorities includes infrastructure. Indeed, it is my confidence in the government's commitment to infrastructure which brings me to my second and final argument that the motion is not necessary.
Earlier this year the Government of Canada confirmed its long term commitment toward infrastructure by announcing a $3 billion investment in budget 2003. This $3 billion represents a significant down payment for the 10 year federal commitment toward infrastructure. This latest investment brings the Government of Canada's commitment to community infrastructure to more than $12 billion since 1993. This in turn is generating more than $30 billion in total infrastructure investments.
Since 2000 the Government of Canada has set up numerous infrastructure initiatives, each targeting different types of projects in different types of communities.
For example, the Canada Strategic Infrastructure Fund targets large-scale projects, while the Canada Infrastructure Works Program supports upgrading of services in communities across the country. Other infrastructure programs concentrate on roads, affordable housing, green spaces and cultural areas, as well as the crucial Border Infrastructure Fund.
Thanks to these investments, the federal government is already meeting needs. These expenditures are predictable and stable; they are not subject to the ups and downs of the economy or the market.
These expenditures will improve the quality of life of all Canadians and will stimulate economic growth in all communities in the country, by ensuring that we have top-notch public infrastructure.
Our friends opposite would suggest that by merely striking an agreement and throwing some tax dollars at a problem, we can find a solution. The government knows this suggestion is neither simple nor workable.
This is a problem that needs more than money; it needs vision, the kind of vision the government offers. It needs an integrated approach to economic, social and environmental issues that is key to the long term sustainability of our cities. It needs solutions that will be found in the partnerships of federal, provincial and municipal governments.
The government does not pretend to have all the answers, but I can say that none of the answers to the challenges facing Canada's infrastructure are found in the motion. Therefore, it is with respect that I tell hon. members that I am unable support it.