Debates of June 12th, 2003

Supply

[Betty Hinton, Canadian Alliance, Kamloops, Thompson And Highland Valleys, BC]

Mr. Speaker, I agree with the preamble of the question. As a former mayor, I think I can speak for some mayors who would be really happy if this were to pass. If we share at the federal level with the provincial level, that allows the province to share with municipalities.

We only have to drive around on some municipal roads to know how desperately money is needed. We are all getting the money from the very same pocket. It comes out of the pockets of taxpayers. It does not matter whether it is on the left side or the right side, that is from where it comes.

There is not enough left in the pockets of taxpayers to pay any more money. This is a logical way to move that money from where it really is not needed to where it is needed.

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

Mr. Speaker, I am delighted to be able to speak to this motion put forward by the member for Port Moody—Coquitlam—Port Coquitlam. In fact, it is a very interesting motion, particularly coming from the Canadian Alliance, which only recently just a few weeks ago started to talk about this issue of vacating tax room for this type of infrastructure program, but as I say, better late than never.

As a former president of the Federation of Canadian Municipalities, I am aware of the importance of cities. I am very aware of the needs that all governments have, particularly when it comes to infrastructure. I suppose the reason I am pleased to be able to talk about this issue today is that through the national infrastructure program the government is in fact well on the road to meeting the infrastructure needs in partnership with cities and indeed with provinces across this country.

Let us consider the first line of the motion we have before us: “That, in the opinion of this House, Canada's infrastructure needs should be met by a regime of stable funding”. I would argue that this government, since it came into power a decade ago, is doing just that. When it comes to making municipal infrastructure needs a priority, we can take a great deal of pride on this side of the House in what we have done.

In 1983 the FCM proposed a national infrastructure program to deal with the deficit in infrastructure in cities across this country. It languished until 1994, when this government adopted the first national infrastructure program.

Mr. Speaker, I know this has been a very important initiative in your community, as it has in my community and across the country. Cities are home to 80% of Canadians and account for the largest share of the GDP and personal income. The government made it clear in the Speech from the Throne last September that competitive cities and healthy communities are vital to our individual and national well-being. That is why we are dealing with new partnerships for a new urban strategy. This is the government that has talked about and delivered on urban issues.

Across the way it is nice that they are finally on the same page, approximately, but I remember being in committee meetings where some members on the other side were slamming the national infrastructure program.

Let us put it this way. In May 2001, the Prime Minister created the caucus task force on urban issues and asked us to engage in dialogue with citizens and experts from all orders of government on the opportunities and challenges facing urban regions in this country. As a member of that task force, let me tell members that we issued our final report in November, and I am sure the hon. members across the way would congratulate us for our vision and what we believe we need to do in terms of partnership with cities for the future of this country. By the time the report was released, the Clerk of the Privy Council had created a working group of officials charged with building caucus task force recommendations, building on that and providing further recommendations for the future.

The government's commitment is very important to this issue. It is important because successive budget surpluses and a strong economy have given us the leverage and the opportunity to be able to invest in the Canada infrastructure works program.

I will point out that when we are talking about investments, and I will get into numbers later, we are talking about investments by the Government of Canada leveraged by provincial governments, leveraged by cities and leveraged by the private sector. In other words, it is not simply federal money. Without the federal government, the others would not be at the table. We are at the table. We are there working with our partners on this issue.

I think an unbiased view of our record would show that we are doing exactly what the hon. members are talking about. The fact is that we are funding infrastructure needs and we are doing it in very important ways.

Let us take the opportunity to talk about investments. Since 1993, this government's investment in infrastructure has exceeded $12 billion. That is just federal money. That does not include the other orders of government and private sector partners. Our contribution only begins there, because the investment has stimulated or will stimulate an additional $20 billion in spending by other partners, including the provinces.

[An hon. member]

Oh, oh.

[Bryon Wilfert, Liberal, Oak Ridges, ON]

Mr. Speaker, one of my Bloc colleagues is complaining over there. Thank goodness that the PQ is now on the other side of the house in the National Assembly of Quebec because it was the PQ that cut back continually on cities in Quebec. The UMQ continually went after the premiers of the day in Quebec and there was no help from the Bloc. Maybe they should take a look at their record in Quebec under the separatists: absolutely useless when it came to infrastructure. Obviously I got their attention, but the problem over there is that they like to talk but they do not like to deliver. They never delivered when it came to those issues.

I want to point out that when it comes to water, sewage treatment plants and rapid transit, this government has been there to invest, and in public libraries as well. All of this is because of the investment that the government has done in conjunction with our partners. We are continuing to do that and we will do more because we are committed to this program.

Let me point out that in 2000 we launched a $2 billion infrastructure Canada program in partnership with provinces and municipalities. This now is funding projects across the country, particularly in the area of water and waste water infrastructure, which I am sure is important to all members in the House. I would also point out that in 2001 we provided $2 billion for the Canada strategic infrastructure program.

What is important is that these are municipally generated programs. This is not the Government of Canada saying, “We know what is best and we are going to tell you what you need”. These are municipally driven. Anyone who has any notion of what municipally driven means knows it means that the cities set the priorities and come to the table with proposals.

Let me give an example. My own region, York region, came forward with a quick start program and put $50 million on the table. We then put $50 million on the table. The province of Ontario languished. In November, it was going to announce with us, then it said no, it had to wait. Then it was going to do it in January. It put that off. We finally and unilaterally announced the money at the end of March. We finally smoked out the Ontario government.

Last week, finally, Ontario put its $50 million on the table. However, we have lost a whole season for construction. That is the Ontario government, which of course says to have faith in the provinces. We could not even get $50 million out of it to match what the private and municipal sectors put on the table with the federal government, because the Ontario government thought it was going to have an election, I assume, and it wanted to do it within that 37 day period. It wanted to play politics. We wanted to put it on the table, and we had it there with our friends and said let us go ahead.

We also have an expansion of convention centres, right here in the city of Ottawa and in Vancouver. There was the cleanup of the Halifax harbour and the expansion of the Red River floodway. These are all municipally generated programs. They suggested them, we looked at them, they made sense and we went forward, again with other participation. Some provinces have been a little more quick to be at the table. I would congratulate the Province of Alberta in that Alberta continually has been very supportive of a national infrastructure program. That has been important.

There also has been recent funding through the border infrastructure fund, which assists projects that improve the flow of goods and services between Canada and the United States. So far, commitments have been made in Windsor, Sarnia and Niagara, and of course I know that the initiative is very important because it also has happened in the lower mainland in British Columbia.

I think we have demonstrated very clearly the work the government has done in the area of infrastructure, but members can rest assured that we are going to go further. Last year the Speech from the Throne committed the government to put in place a 10 year infrastructure program. It is something for which municipal governments have been asking for years and years, because municipal governments need to plan. The way they plan on a capital program is on a five year or ten year cycle. They need to know, so we put an initial investment down with regard to that. That was very important, because again we are looking at leveraging.

A lot of people talk about infrastructure in the House and forget the word leveraging. They forget the fact that the provinces, the municipalities and the private sector also put in money to leverage. For every $1 they put down, they get $2. It makes sense. As I have said, that 10 year infrastructure program will accommodate the long term strategic initiatives essential to competitiveness and to sustainability in terms of growth, which again I will say is part of this government's agenda.

It is important to note that a few months ago we backed up this commitment with a significant down payment of $3 billion as an initial payment toward this. It was very important. As we know, the Canada strategic infrastructure fund is for large projects in large urban areas. I listed a few of them minutes ago. We must keep in mind that the FCM said it wanted to do things with regard to the environment, so it wanted to look at getting a fund that would help in that regard. It proposed the FCM green enabling fund. The government initially put in $150 million. This revolving fund was such a success, and I know the New Democratic Party was pleased about this, that the government put in another $150 million because the fund is doing the kinds of things that from an environmental standpoint and infrastructure standpoint are important in communities across the country.

We talk about stable funding, and this is also important. The fact is that the government has had numerous infrastructure programs in conjunction with our partners. The government sat down and worked with them, again, though, always saying that the premise is that those programs had to be municipally driven. Otherwise, a top down approach is not going to work. We do not support that.

This has been important for communities in the Northwest Territories. It has been important for the City of Yellowknife. I had the pleasure of working for many years with the then mayor of the City of Yellowknife, Pat McMahon, who worked tirelessly to make sure that those federal funds, in conjunction with those of the government of the Northwest Territories, helped improve water, sewer and roads in her community.

There were testimonials from mayors across the country who realized the importance of this. I think that is important to recognize. It is all part and parcel of competitive cities, not only on this continent but around the world.

Our friends across the way are saying it is about faith, that provinces may take the tax room, that we will have an arrangement with the provinces whereby they will take the money and make sure it goes to where it is needed. The difficulty is that sometimes the provinces have short memories.

As we know, often in the area of health care we hear that government is giving x number of cents, but the tax points are forgotten. Tax points of course mean that we vacate and the provinces receive revenue we otherwise would have. Yet the great myth the Alliance always talks about is the 14¢. I think now their myth of what we give on health care is up to 18¢. This is utter nonsense. The reality is that they do not include the tax points and we no doubt would have the same nonsense if we went ahead with this proposed situation.

At the same time, one of the members across the way raised some very important issues with regard to mad cow disease and SARS. If we had the dedicated tax the hon. member wants, we would have no flexibility whatsoever, and emergencies do come along. However, when one is in opposition one can ask for $3 billion one day, ask for a cut of $2 billion the next day, say to raise $4 billion the next day, and tell us to spend, spend, spend. That is not prudent financing.

This government has its fiscal house in order. We have eliminated the national deficit of $42.5 billion. Canada is the only G-7 country paying off its national debt. It has gone from 71.5% of GDP down to 44% and falling. It is because of those initiatives, because of the single minded purpose on this side of the House, that we are able to have the types of programs I have talked about today to help communities across this country.

There are the prairie grain growers, with $175 million over 2001-06 in federal funding; from the agriculture department, $159 million. If one were to listen to members across the way one would think there was absolutely no money going to communities across this country. They should take a look at that. They should take the time to talk to some of their municipal colleagues and find out.

Affordable housing is another good example of what this government has done. There is $680 million on the table and again there is another problem with Ontario. We put money on the table and the province basically said it would not put any money down but would use in kind, put forth by municipalities. It was their money. Essentially Ontario did not come to the table. That is a problem. It is a problem because this country is about partnerships. One of the most effective partnerships this government has discovered is that of working with municipal leaders across Canada and addressing those issues. Again I will refer to the fact that the party across the way is only now recognizing this as an important issue

I would like to point out that it is not simply about roads, bridges and sewers. It is about issues dealing with the environment, making our communities better in terms of cleaner air. Cleaner air is very important. We worked with cities in recognizing what they wanted. I refer back to the green enabling fund and how important that was for projects to move forward.

In April 2000 the Federation of Canadian Municipalities supported 226 initiatives and approved $36 million in funding through the green enabling fund, which has a total value of $134 million. It is an obvious example, not only of stable funding, but of cooperation and partnership. We do not just talk about it, we deliver.

The 2003 budget announced several new environmental initiatives including $3 billion to help cities improve the quality of life for their citizens. That included $2 billion over five years to implement the government's climate change plan for Canada to improve air quality for Canadians, and to ensure that people who suffer from emphysema, for example, could breathe better because of those types of initiatives. The 90% reduction of sulphur in gas, for example, is very important. The fact is that since 1993, discounting provincial, municipal and others, $30 billion has come from the federal government to deal with infrastructure issues. That is $30 billion more than we had in the previous regime.

If the Canadian Alliance were to have its way, until recently I guess, it would have followed in the footsteps of the Conservative Party. It would not have helped the cities. Alliance members have never been on record as supporting cities, except when their leader went to the FCM the other week and suddenly, on the road to Damascus, he saw the light and said “We are going to assist cities on infrastructure”. That is great. We like that because now I will not have to argue with Alliance members about why this is an important issue. We know it is important.

It is unfathomable to me how the Alliance Party can suggest that we are going to simply turn over. We have read the motion. It says that we should do this with the consent of the provinces. Provinces will of course sign on to anything where they think they will get more money. However, one of the comments that I have heard in the House is how the provinces need more money.

Let us check the record because it is very clear. Provinces have the same fiscal capacity to raise money that the government does, but of course they would rather not do that because obviously they do not find it politically palatable. However, they have the same ability to do so.

Bloc members have made a career out of complaining about federal transfers. This was the same party that held up the budget implementation bill earlier when we in fact had put more money into the hands of Quebeckers. However, they would rather complain.

I want to again emphasize that it is because of these kinds of programs that we have that flexibility. We are able to come up with new initiatives, such as the cultural space program for cities, which is very important, as well as affordable housing. However, if we were to tie our hands as the party across the way would do, we would not be able to do that. We would not be able to respond to new initiatives and we would have some cases where money would be over supplied in one area and underfunded in others, and that would not be very useful.

I want to point out again the importance of this program to the government and of the many initiatives that we have taken. I look forward to the continuing debate in the House as the day goes on.

[The Deputy Speaker]

Questions and comments. Before I give the floor, I wish to remind members that they must be in their seats to be recognized by the Chair. I will now move to the member for Windsor West.

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, I found those comments interesting. This is a very important debate for Canadian municipalities. It is important for us in the New Democratic Party because Jack Layton is the immediate past president of the FCM.

What was left out from the discussion, which is kind of interesting, is that the Federation of Canadian Municipalities has now indicated a $57 billion deficit in infrastructure spending. The federation and many municipal leaders ascribe the government's recent infrastructure plan as doomsday for municipalities. Even in today's paper the mayor of Ottawa is identifying once again the downloading that has happened.

I understand why the government will be opposed to this motion. It is because of the complexity it would create with the provinces. The fact that it will not get the actual funds to municipalities is one of the concerns I have. At the same time the government is not providing the resources. It talks about the $30 billion that it has invested, but we do not see it on our city streets and we do not see it being outlayed in major projects for which we need the investment.

My question to the hon. member is whether or not he feels the current infrastructure allocation of the last budget is sufficient for Canadian municipalities? Even the finance minister said it was a down payment, admitting that it was so bad.

I must say the former finance minister and the current finance minister, when they met with the FCM, were more like they were auditioning for the movie Dumb and Dumber with their infrastructure programs and suggestions because they were not listening to the Federation of Canadian Municipalities and municipal leaders.

My question is quite direct. Is that enough for municipalities? Why are they not getting the support when it is clear the voices are coming from there? When will the government act? We will see another construction season, whether it be for roads, sewers or what not, evaporate before us. We will have to wait another year for very urgent needs for our communities for which municipal leaders are clambering.

[Bryon Wilfert, Liberal, Oak Ridges, ON]

Mr. Speaker, I thank the member for the question, although I am a bit astonished that a member who has a municipal background, as this hon. members does, would ask such a question.

The reality is that, under the Constitution, the jurisdiction in terms of powers for municipal governments lie with the provinces. I agree that municipalities need more funding powers. How would they get that funding power? The Province of Ontario could give them part of the gas tax if it wished. The provinces could give municipalities the hotel tax. Toronto said it would like to have a hotel tax and the Province of Ontario said no.

If hon. members want to hear the answer, that is fine. If they want to shout, they should audition somewhere else, because when it comes to dumb and dumber, the hon. member should talk to his buddies next to him.

The reality is that when it comes to sewers, water, et cetera, it is a partnership. The federal government will not fill the potholes. That is up to the municipalities. They establish their priorities. The member says that the 10 year program and the initial down payment was not enough. Excuse me, I cannot believe my ears.

He must be in a different world. Members opposite have been clambering for a 10 year program and an initial down payment, but what the member is suggesting is that provinces should be out of the way, that municipalities should continue to say they will not raise any taxes, but that the federal government should continue to be the gatekeeper. It should be the one to fund all these services directly. That is not acceptable.

[Brian Fitzpatrick, Canadian Alliance, Prince Albert, SK]

Mr. Speaker, I am still not sure whether or not the parliamentary secretary is in favour of our motion today. It seems like the member for LaSalle—Émard is in favour of our motion. At the creative cities conference on May 29, 2003, the former finance minister said:

Many cities have suggested that having access to a portion of the revenues generated by the gas tax would be of significant help in making their budgets more reliable and predictable.

It seems like the former finance minister would be supportive of our motion. I would like to ask the parliamentary secretary whether or not he wants to line up with the Canadian Alliance and perhaps the Prime Minister in waiting to make some of the gas taxes that the federal government collects available to the provinces and municipalities so that they can build their infrastructure, and stop building sports boxes in sports stadiums across Canada in the name of infrastructure?

[Bryon Wilfert, Liberal, Oak Ridges, ON]

Mr. Speaker, to equate the former minister of finance with the Canadian Alliance is so delusional that I cannot understand it. The former finance minister was the one who, in conjunction with the Prime Minister and the government, brought in the national infrastructure program. It is because of the former finance minister, the government, and the Prime Minister that we have a program. Had we continued to languish under the Tories, we never would have had that.

The fact is that the motion says “on an agreement with provinces”. To date, we have not seen one province that is prepared to share that kind of money. I will give an example. In the Province of Manitoba, the city of Gimli wanted to put a 5¢ tax on liquor because it wanted to use it for its police force and it passed a resolution. It is still awaiting an order in council by the NDP government of Manitoba to okay it. The fact is that here was a city in Manitoba that actually wanted to get empowered and got nothing from the Government of Manitoba.

My friend across the way should not be under any illusions. This motion has nothing to do with anything that any member of the government has ever said.

[Odina Desrochers, Bloc, Lotbinière—L'Érable, QC]

Mr. Speaker, my hon. colleague opposite takes pleasure in using the Constitution whenever it suits him. This government has made a specialty of interfering in provincial jurisdictions, but when the time comes to take its leadership role, then it invokes the Constitution.

Does the Parliamentary Secretary to the Minister of Finance see it as normal that the Canadian government collected $4.758 billion in fuel taxes, but only spent $119 million on roads? That is what I call fiscal imbalance. Am I right in thinking that the role of the central government is to distribute money to the provinces, not crumbs?

I would like to hear him on that. Does he find it normal that his government collects nearly $5 billion but gives back only $119 million to look after roads? Is that normal? Is that equitable? Or is it just a typically Liberal thing to do?

[Bryon Wilfert, Liberal, Oak Ridges, ON]

Mr. Speaker, I see some residue from the PQ government over there where his friends in the PQ talked a lot about provincial jurisdiction.

Yet, when it comes to areas such as health care, they are always after a handout saying that they need more and more. When it comes to infrastructure, nobody put a gun to the Government of Quebec when it signed successive infrastructure programs because it knows, as well as I and others, that the UMQ was strongly in support of the infrastructure program.

This member talks about dollars. It was the Quebec government, about seven years ago, that unilaterally cut back on funding to cities in Quebec, with no discussion, after the cities had already passed their budgets. I do not think we have to take any lessons from over there about dollars and cents. Maybe the hon. member should go back and ask those questions of his colleagues.

[Jocelyne Girard-Bujold, Bloc, Jonquière, QC]

Mr. Speaker, I appreciate finally being able to speak to set things straight. Unfortunately, one of the members to whom I wanted to direct my remarks is not here. I would have liked to give him the real figures, but he is gone.

I will begin by telling the member from the Canadian Alliance that the members of the Bloc Quebecois will not support the Canadian Alliance motion. We might have been able to support it if it had stopped after “gasoline taxes”, because the rest is nothing but interference in areas of provincial jurisdiction, making the reduction conditional on the provinces doing certain things and raising money.

Quebec is not a local government. Quebec has full powers. I do not see why, as a federal member of Parliament, I would tell the provinces, and Quebec in particular, to do as they please when it comes to their highway infrastructure. We know that this 1.5 cents per litre gas tax, imposed by this government in 1995, was introduced to fight the deficit and eliminate it. We know that in 1998, the former Minister of Finance said that the fiscal imbalance had been addressed, yet he continued to pocket this money. We do not need any lessons from the parliamentary secretary. This is a serious issue.

Mr. Speaker, I forgot to advise you that I will be sharing my time with the hon. member for Lotbinière—L'Érable.

We know that, with just 10¢ in excise tax in 2001-02, the Liberal government of Canada collected $4.758 billion in fuel taxes in Quebec. That is a lot of money. And what does the government do with that money? We do not know. It seems to me that when taxes are collected on fuels, it is to take care of infrastructure matters. But no, the federal government takes this money and we do not know what happens to it.

In 2002-03, Quebec collected $1.6 billion in fuel taxes and invested over 117% of that money. The government looked for money in other budgets within the transportation department. Quebec is doing its job.

The parliamentary secretary spoke of the infrastructure issue. I am the Bloc Quebecois critic for infrastructure; I have attended all the negotiations. I also was present when all the cities submitted their projects. It is understandable that it would come from the cities because municipally elected officials are the first point of contact for the public. They know what they need to improve their infrastructures, from sewers to water mains to roadways.

An agreement had been negotiated. For the last two infrastructure agreements, which involved the federal, provincial and municipal governments, it was agreed that Quebec would run the show. The municipal governments sent in their latest proposal for an agreement to the Government of Quebec. They had over $4.3 billion in projects, but in the negotiated agreement the federal government put $1.9 billion on the table. There was a shortage of money. The projects are waiting. What this government wants to do now is to go over people's heads. I think it is going in the same direction as the Canadian Alliance. I think it is just more of the same. It does not respect provincial jurisdictions.

In Quebec, the municipalities are creatures of the provincial government. So, when a creature belongs to one level of government, I do not see why a higher level could go over the head of the person or entity to whom the creature belongs, to go and negotiate with it instead.

This parliamentary secretary has said some very odd things. The Bloc Quebecois has provided the real numbers, while the parliamentary secretary has pulled them out of thin air. The real figures are here.

In speaking about the needs, he even mentioned the Federation of Canadian Municipalities. He says that he spoke with its representatives. After the last federal budget, that federation took a stand.

In the throne speech, the federal government said that infrastructure had to be put in order. The current situation is serious. It was announced that needs in Canada required investments of $57 billion over the next 15 years. How much did the government offer? It put $100 million on the table, when it had pocketed $4.7 billion from the fuel tax in 2002-03 alone.

Any child of five, six or seven years of age can calculate the difference between a need for $51 billion over the next 15 years and the $100 million actually offered, without including the $4.7 billion being pocketed each year. This is proof of the fiscal imbalance that the Bloc Quebecois condemns. The PQ government has also spoke out against it, as has the current Charest government, in Quebec City, and all the other provinces.

This government will take the money from the taxpayers, as it has done with employment insurance. The fund has $44 billion. The government took that money. I call this a payroll tax. Workers pay employment insurance premiums. This means that when you work, you pay an additional tax. In my opinion, workers want to enjoy their salary and to pay taxes normally. They do not want to pay additional taxes.

In terms of employment insurance, only 37% of workers are entitled to benefits. Furthermore, when they do receive benefits—which is quite difficult—their premiums are only about between 50% and 55% of what they should be.

Whose idea was this? The current Minister of Finance has picked up where the former Minister of Finance, the member for LaSalle—Émard, left off. The latter ran Canada like a financier would. It is not surprising. He owned ships and did not pay taxes to Canada or Quebec. Imagine the millions of dollars he has not paid. With that kind of money we could have done things to help the workers, built infrastructures, helped the poor and the homeless. Imagine what we could have done with the money that was not paid by the former Minister of Finance, the member for LaSalle—Émard.

The way infrastructure funding is handled is preposterous. There are immense needs not only in Quebec, but in Canada. Everyone agrees. The Canadian Alliance has put forward a motion. They are saying that the government should reduce the excise tax on gasoline by 1.5¢ per litre, on condition that the provinces come up with additional money themselves. That is not what the provinces want.

The provinces want the fiscal imbalance to be resolved. If this were done, if the federal government invested the money it takes in from the fuel tax—last year it collected $4.7 billion—if it helped the provinces shoulder the cost of infrastructures, everyone would be happy. There would be modern infrastructures and the taxpayers' true expectations would be met. The taxpayers want something to show for their money.

However, what is currently happening at the federal level is that the government is pocketing or accumulating money and we do not know what they are doing with it. In the meantime, infrastructures are deteriorating. Moreover, the parliamentary secretary has the nerve to accuse the provinces of not doing their work. On the contrary, they are doing their work very well despite all the cuts that the federal government has been making for many years.

The federal government is the one that should be putting out the money. I suggest to the hon. member from the Canadian Alliance that he take out what follows the words “gasoline taxes” in his motion. If he takes out what makes it conditional, the Bloc Quebecois will support the motion.

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

Mr. Speaker, the hon. member has indicated that on the one hand we are imposing on Quebec and on the other hand we are not giving Quebec enough.

The Government of Quebec under the PQ, as I said before, did a unilateral cut of $500 million after cities in Quebec had already passed their budgets. This is what we call good cooperation between cities and the province of Quebec.

On the other hand, the PQ when it was in office did not have a very strong relationship with municipalities in Quebec because it did not provide the very thing that she suggested. The member suggested that they should have stable funding but how can they deal with a government that pulls the rug out? That is in fact what the PQ government did. I remember many mayors, in Quebec City, Montreal, Sherbrooke, and elsewhere saying that this was unconscionable by the Péquistes.

How does the member reconcile the fact that on the one hand she is suggesting that we are not providing enough funding for infrastructure in Quebec and on the other hand the Quebec government has not done its share when the PQ was in? She will dispute that but I would like to hear her comments.

[Jocelyne Girard-Bujold, Bloc, Jonquière, QC]

I would rather address you, Mr. Speaker, because if I were to address that member, I would not be very nice.

I quoted figures earlier. I indicated that, in the past year, 2002-03, Quebec, along with the municipalities, invested more than 117% of the gasoline tax revenues, plus money from its own transport department. If that is not cooperation with the municipalities, I do not know what is. Who has the money in Canada, with the fiscal imbalance? The federal government. And it has the gall to want to negotiate directly with the municipalities.

That makes no sense. The parliamentary secretary should do his homework and take this issue seriously. It is very important; people's lives are at stake. We are talking about water and sewer infrastructure. We know what happened in Ontario with the water system and water treatment. It is only natural to want to upgrade our infrastructure.

This is not the kind of attitude that will lead to an agreement or to progress on major issues. We are talking about health. The fact is that infrastructure has a direct impact on the health of Canadians and Quebeckers.

Let us stop talking nonsense and start dealing with reality. I do not accept such things from him. I can understand where he is coming from, since he is here to defend his government. But the taxpayers do not give a hoot about party politics when it comes to meeting their real expectations. As far as health is concerned, their needs are directly linked to the infrastructure situation.

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, hearing the government's position on this is very disturbing to say the least. It is ignoring its responsibility and it is also not calculating the other downloading that is happening.

Has the province of Quebec, similar to Ontario, been under the siege of massive funding cuts at the same time as the government is usurping other taxes and surpluses? Has it faced the same problem which has made difficult infrastructure problems because of the downloading on the municipal and provincial governments?

[Jocelyne Girard-Bujold, Bloc, Jonquière, QC]

Mr. Speaker, I thank the NDP member for his question. We keep coming back to the same thing: fiscal imbalance.

Yes, transfer payments have been cut to Quebec, as government transfers to the provinces have been cut.

It is easy to be arrogant when one's pockets are full of money stolen from others, money that one has appropriated, when there is a duty under the Canadian Constitution to redistribute tax transfers to the provinces for normal needs in areas of jurisdiction that do not belong to us. But that duty has not been met. It is all very fine to pat oneself on the back, but I would not like to be in his place and to be patting myself on the back over this.

The government is here, not to manage Canada like a private business, but to meet the needs of the taxpayers. And this government is not doing so.

[Odina Desrochers, Bloc, Lotbinière—L'Érable, QC]

Mr. Speaker, I will also be following the recommendations made by my colleague and vote against the Canadian Alliance's motion for the reasons she gave. I would add that all of the efforts made in this House are for naught.

The fact is, this government is in transition. No one is making decisions. Yesterday or the day before, the member for LaSalle—Émard arrived in the Saguenay—Lac-Saint-Jean and said basically what the current Parliamentary Secretary to the Minister of Finance has said.

This government has no captain at the helm. The ship is drifting, but I am not referring to one of those that belong to the former Minister of Finance. They are in other countries, in tax havens. While the member for LaSalle—Émard was Minister of Finance, he was vehemently opposed to eliminating tax havens in the West Indies. We know why.

I will be curious to see if the member for LaSalle—Émard will act like a real taxpayer and shoulder his responsibilities when he finally becomes Prime Minister. When you are a taxpayer and you run a corporation, you have to pay taxes. When you do not pay taxes, you are not a good corporate citizen. You are not shouldering your responsibilities. If all Canadians behaved like the member for LaSalle—Émard, what kind of administrative mess would we be in and what would happen to Canada's economy?

I would like to say to the member opposite—who spoke earlier and who made comments about the Parti Quebecois—that it was Yves Séguin, the current finance minister in the Charest government, who clearly proved that the fiscal imbalance exists. Earlier the member mentioned the fact that municipalities come under provincial jurisdiction and that that terribley PQ government, the terrible separatist government, as they put it, had cut funding to municipalities.

That is what is called nation building. It is the way the Liberals behave in order to smother Quebec. It is easy. They cut off the money at the source and the Government of Quebec finds itself with a shortage of funds. It had to make difficult choices. In making these difficult choices, it had to make cuts with respect to municipalities. It also had to make cuts in highway maintenance. The money is in Ottawa.

It is well known that the excise tax was originally introduced to support the creation of Petro Canada, which, as far as I know, has been sold to private investors. I think perhaps 25 or 30% remains in public hands. I do not follow the ups and downs of Petro Canada on the stock market, but there is no longer any reason for the excise tax. About $4.758 billion has been taken for no reason from the taxpayers' pockets. Now, we have to deal with it, because this government specializes in taxes. Since it does not want to eliminate the excise tax, it should take the money and invest it in the provinces. The money does not belong to the federal government.

A short while ago, the parliamentary secretary said that Quebec and the provinces do not treat the municipalities very fairly. Nevertheless, the figures are clear: 117% of the fuel tax is directly invested in highways, and, of the $4.750 billion, $2.5 billion goes to highways. That is a fiscal imbalance.

I smiled when I read the Canadian Alliance motion. Since the Alliance has been here, its members have specialized in saying that there are too many taxes and they should be eliminated. Now, they take one tax and want to turn it into a new one and make it a provincial responsibility. That does not work.

The Canadian Constitution is clear. But the hon. members across the floor are messing around with its interpretation. When it suits the federal government, the Liberals say, “That is a provincial responsibility”. Look how they operate with softwood lumber. Look how they operate with gasoline. When things go badly, they say it is the provinces' fault.

Things are going badly in the provinces because the federal government is not doing its job. Generally, a confederation ought to cooperate, subordinate, coordinate the federations. What we have is not a confederation but a centralist Canadian federation, a product of the dream of former Prime Minister Pierre Elliott Trudeau.

The people in government, along with the present Prime Minister and the present Minister of Intergovernmental Affairs, are suffocating Quebec, taking away its responsibilities. What is happening is that there are difficult choices to be made. Those who are really responsible for the financial chaos in Quebec are the people across the way. Those who are really responsible for the pitiful state of our highways—with which I am familiar, since I live in a very rural riding—are in government.

We have the infrastructure program, clear agreements. But when those clear agreements come here to Ottawa, we are all very well aware of how they get fiddled about with at Economic Development Canada, of all the red tape, of all the delays there are. Who is responsible? Always the Canadian government, which is not doing its job.

There is a surplus and there is fiscal imbalance. The solution is clear. They merely have to hand the money over to us, to the provinces, and we will administer it. When we have the money to which we are entitled, we will be in a position to meet the expectations of the municipalities, which are under provincial jurisdiction. That is clear.

It seems to me that the federal Liberals can no longer lay the blame at the feet of the terrible separatist government, as the parliamentary secretary was just doing. They are no longer in power. Now it is the provincial Liberals, with Yves Séguin as Minister of Finance, he who has been openly critical of the fiscal imbalance. So where can the blame be laid? They will have to talk to each other. I would imagine there would be a certain degree of accommodation between two groups of Liberals.

I am looking forward to seeing the present Minister of Finance tell Yves Séguin, “Dear Yves, I know there is a fiscal imbalance. Now that the minister is no longer a PQ minister, I can acknowledge that there is a fiscal imbalance.” They have no choice. That is the reality.

As I said at the beginning of my speech, however, the problem is that there is no longer anyone in this government making decisions. There is a Prime Minister who is coming to end of his mandate, and a future Prime Minister who says all manner of things all over Canada, but who is often conspicuously absent when there are crucial votes. Take yesterday's vote on Bill C-24 as an example. This cuts very close to the partisan heart of the member for LaSalle—Émard, and he was not there. So what are we to do?

This government is in transition, and is having trouble governing. As I was saying, the Liberal government's ship is drifting, unlike the ships of the hon. member for LaSalle—Émard. Currently, the Liberal ship has no rudder. There is no one at the helm and it is listing. The Liberal government's ship must be prevented from entering the St. Lawrence or it could run aground on the north or south shore. It would not even be able to find the channel. The channel is the central canal where there is sure sailing. But this is not the case.

I hope that, over the next few months, once we have a real Prime Minister, a real Minister of Finance and a real cabinet, they will acknowledge that there is a fiscal imbalance and give the provinces the money they need to meet the real expectations of the municipalities.

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

Mr. Speaker, the good news is that now we have a government in Quebec with which we can actually work, a government that has indicated, as has the Minister of Finance, that they are looking forward to working with Mr. Séguin.

The fact is that there will always be issues between the federal government and the provinces, but working in a collaborative manner is very important. Therefore we obviously are pleased to hear that the minister in Quebec indicated very strongly that he will work with the Minister of Finance.

The member says that we are leaderless, that we are adrift. If the member were correct, I would hate to see if we did, because the 2003 budget deals with health care funding, infrastructure, child poverty, and a vast array of issues, but still continues to have no deficit. We have had six balanced budgets or better.

The member talks about infrastructure issues, yet what I cannot understand and what I have not heard is that if there is an imbalance, as the member says, why is it that the provinces have the same fiscal capacity as the federal government? If there is a problem then maybe Quebec, certainly under the PQ it preferred to blame us rather than work with us, maybe the PQ should have looked at its own fiscal house and dealt with that issue. We know the problem the PQ had because of course it left the cupboard bare: $4 billion. Obviously it did not have a lot of money. I do not know what the PQ did with it.

The PQ talked about moneys from the federal government and yet it sat on $600 million from the federal government because it did not want to spend it on areas upon which it thought we were imposing. However the PQ sat on it and still said, like the little boy in Oliver Twist , “Please, sir, give us more”. It is very odd.

In this case I do not know how the member could stand and say what he did, given the shabby treatment that the PQ handed out to the municipalities in Quebec. Without the support of the Government of Canada and the national infrastructure program, more than half the improvements in cities in Quebec would not have occurred. At least the PQ had the sense to sign on even if it did cause a lot of difficulty for the municipal governments.

[Odina Desrochers, Bloc, Lotbinière—L'Érable, QC]

Mr. Speaker, in listening to the current parliamentary secretary, I am almost tempted to invite him to run in Quebec, because he talked only about Quebec. We are talking about Canadian situations. As a sovereignist and a member of the Bloc Quebecois, I am talking about a Quebec situation. But to hear him, I think that if there is ever a seat available in Quebec, I would strongly suggest he run in Quebec. He talks only about the Parti Quebecois.

Yes, perhaps there were cuts. But as I was saying earlier, if the Quebec government was forced to make cuts, it is due to this government's strategy to suffocate Quebec and take away its autonomy.

It is not complicated, I am going to do some quick math. The government took $100 from us with cuts to the employment insurance fund, and since it has been running surpluses, it gave us $20 back; and it thinks we will be happy. We are out $80; I think this is not hard to understand. The government took $100 and gave us $20 back, and it thinks we will forget that we are still short $80. We use hard facts, calculations and columns to understand. All the government does is forget the past. Everything has to be erased.

I keep coming back to the hon. member for LaSalle—Émard, who is going around saying that everything in this Parliament is going to change. In that case, all the Canadian taxpayers and all Canadians will have to forget the financial massacre he led and orchestrated as former Minister of Finance. He was responsible for creating foundations, cutting transfer payments and grabbing money from the employment insurance fund.

Quebeckers and Canadians will remember. The government members opposite are responsible for the current situation. And they are to blame if the municipalities are suffering.

[Norman E. Doyle, Progressive Conservative, St. John's East, NL]

Mr. Speaker, I will be splitting my time with the member for Cumberland—Colchester.

The Canadian Alliance motion states that Canada's infrastructure needs should be met with stable funding. Of course we can all agree that Canada's infrastructure needs should be met with stable funding, but the motion goes on to call upon the federal government to reduce its own tax on gasoline in return for negotiating a deal with the provinces, where each province would then introduce a new tax to fund its own infrastructure needs. On that particular point, I think I am safe in saying that we profoundly disagree with the motion. We think it would be complicated. It would be a convoluted way to get moneys to fund infrastructure in Canada.

One of the main problems with the motion has to do with dedicated taxes. Simply put, I believe that dedicated taxes are not the Canadian way. In our system tax revenues from all sources go into one pot and the government allocates expenditures on its priorities from that one big communal pot. Dedicated taxes are often used in the United States. Such taxes are useful when they are used probably to fund a specific project.

However, our national infrastructure requirements are varied and they are ongoing as well. Older infrastructure needs to be replaced or upgraded. New and more modern infrastructure has to be constantly built. That situation requires an ongoing commitment to maintaining and building infrastructure. It is something that should be met, we are of the firm opinion, with leadership from the federal government and cost shared funding from the federal treasury, not dedicated taxes.

A number of years ago we in Newfoundland and Labrador had a cottage hospital tax to help fund health care in rural areas of Newfoundland and Labrador in the early days after we came into Confederation. That tax was still around, believe it or not, when I served in the provincial government back in the 1980s.

That dedicated tax was used to fund part of the health care system in Newfoundland and Labrador, the old cottage hospital. That dedicated tax was still around back in the 1980s. Dedicated taxes have a tendency to stay around, to hang on forever and to grow and grow regardless of whether or not they are currently serving the purpose for which they were implemented.

As I said a moment ago, there are very big infrastructure needs in this nation, projects of a size and scope that demand federal involvement at the financial level, at the federal-provincial agreement level. Some very big projects have happened in the nation. The fixed link between Prince Edward Island and New Brunswick was a very big project. I do not know if a project like that could be funded without some kind of federal-provincial agreement, not a dedicated tax.

Passing the taxation power down to the provinces and expecting the provinces, each with its own agenda and priorities, to build something of a national nature is doomed to failure. More important, from the point of view of the House, it is an abdication of our responsibilities in nation building and is the main reason that we would not support this motion.

We have always had very good success with federal-provincial agreements. All it takes is more agreements and a greater commitment by the federal government to fund these agreements between the two levels of government.

The motion brings into contrast some of the main differences in philosophy between our party and other parties in the House. One sometimes gets the impression that the Alliance in this particular case believes that government is the main problem and is not part of the solution. We believe that government at the federal level has to be part of the solution. In this motion it readily gives up its national responsibilities in favour of devolving taxing and spending powers to the provinces.

Our party, on the other hand, recognizes that most Canadians do not look upon their government as the enemy, that they expect their government to play a role in making their communities and their country a better place in which to live. Canadians want their federal government to play a leadership role through cooperative agreements. Federal-provincial agreements have worked very well in the past.

The Alliance motion does not lead; it passes the buck. Better put, it passes the power to raise and to spend the buck. If we had the kind of system that the motion encourages, as I said, small provinces like Prince Edward Island or Newfoundland and Labrador would not have the capability to fund the larger projects like the fixed link in Prince Edward Island.

Canadians these days are feeling the effect of our country existing in a leadership vacuum. We need leadership in building our infrastructure. We need leadership in building the health care system. SARS and the mad cow crises have shown just how absent federal leadership has been in our country. We need leadership in maintaining and developing our national transportation and our municipal infrastructure needs.

Canadians today can sense the drift in the focus of their national government. They need leadership like never before in this very troubled world of ours. Yet what is the official opposition response? Its response is to let the provinces handle it.

Instead of embracing the challenges of rebuilding our national infrastructure system, I think what we are looking at in the motion is a way of passing the buck on to the provinces. This should not mean that the federal government should be going it alone. The federal government has to work in partnership with the provinces and the municipalities to rebuild our national infrastructure. That is not an easy task in the kind of diverse federal nation that we have. Then again, leadership in Canada has never been easy. If there are serious imbalances in the taxing and spending powers of our national, provincial and municipal governments, this is something we should look at globally in concert with the provinces. Shifting around responsibility on a tax by tax basis is only a recipe for trouble and confusion.

I do not believe we should be passing the buck in this regard. We need to be taking the bull by the horns and getting on with the job of making Canada a beacon in an often dark world.

I believe we can achieve our municipal infrastructure objectives much better with the use of federal-provincial agreements than we can by dedicated taxes.

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

Mr. Speaker, I particularly concur with the hon. gentleman's comment with regard to cooperation, that it is in cooperation with municipally generated programs. The hon. member made a good point in terms of needing to work cooperatively with the provinces and municipal governments in Canada. That is what the government has been doing since it first came into office. The fact is that the government has made sure through the national infrastructure program, through the strategic infrastructure program and others, that they are municipally generated.

The issue the member touches upon is that we do not want to abrogate responsibilities. Simply by having one order of government raising money and turning it over to another order of government so that order of government does not have to take responsibility for it but can spend the money is an issue with which members in the House have to deal. If members think that this is a good approach, then obviously there are going to be implications. The member's point about cooperating is a very important one. Simply, the provinces getting money from the Government of Canada and hoping they will turn it over to municipalities, at least in the province of Ontario, has not been successful. I commend the member for that point.

I would ask the member very specifically about the issue of vacating tax room. Let us assume for a moment that we agree with the Alliance motion. It is based on the premise of the provinces being able to take the money and turn it over to municipal governments. How would that be structured to ensure that in fact it would work? Why is the option of cooperation probably the better road to take?

[Norman E. Doyle, Progressive Conservative, St. John's East, NL]

Mr. Speaker, one of the main problems we would have with the motion is it would be very difficult to build the kind of structure whereby the federal government created tax room for the provincial government to implement its own taxes.

As I said a few minutes ago, dedicated taxes have a tendency to go on for ever and ever. I do not know if the hon. member was in his place when I mentioned it, but Newfoundland had a cottage hospital tax shortly after Confederation. When I served in government back in the 1980s, the old cottage hospital tax was still in place and only was eliminated sometime in the 1980s. They have a tendency to go on for ever and ever.

To have dedicated taxes wherein the provincial government would take the taxes from gasoline would in no way guarantee that the federal government would not continue to raise taxes on gasoline over time. I do not think it is the way to go about it. Municipalities have to be better involved in the budgetary process at the federal level. The federal government needs to be a full partner in assisting municipalities in dealing with the costs associated with meeting the infrastructure needs.

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, it is interesting to hear the conflict that the government has on this. The member for LaSalle—Émard is supporting this and is married to the Alliance motion. Similarly, we are seeing conflicts where the parliamentary secretary talked about the fact that it is a provincial responsibility, being the municipalities, but at the same time he cannot abrogate responsibility to them. He cannot have it both ways but he is trying to do so.

In the last budget we saw tax relief for things like coal, which is causing greenhouse gases. There were a number of different strategies that the government went through with Kyoto to try to reduce it. At the same time it did not provide tax relief for urban transit. That is something the municipalities have been clamouring for. I want to ask the hon. member's opinion about that. Why one and not the other?

[Norman E. Doyle, Progressive Conservative, St. John's East, NL]

Mr. Speaker, that would be a question more aptly put on the agenda for the government. I certainly do not know why there would be tax relief for one and not for the other. I do know that we need the federal government heavily involved with municipalities if we are going to fund some of the larger infrastructure projects in the country. I made reference a little while back to the fixed link.

We have often looked at having a fixed link from Newfoundland and Labrador across the Strait of Belle Isle. I do not believe we can fund these kinds of projects unless the federal government is fully involved with a commitment to ongoing funding for municipal infrastructure.

[Bill Casey, Progressive Conservative, Cumberland—Colchester, NS]

Mr. Speaker, I thank the distinguished member for St. John's East for sharing his time with me.

I was sitting here listening to his comments and I thought he was talking about a cottage hospital tax. I was wondering if that was a hospital for cottages. Then I realized what he was talking about. Again, it shows us the differences in our provinces and right across the country and how things have changed. We did not have a cottage hospital tax in Nova Scotia. It was interesting to learn about that and I intend to ask the member more about that after I finish my comments.

I agree with the member for St. John's East. Infrastructure funding does need stable funding. We need a program where we can count on investments on an ongoing basis.

The government takes great pride in standing up in the House and taking credit for eliminating the deficit. The fact of the matter is the government did it in two ways. It downloaded the deficit to other levels of government, plus it created a deficit in infrastructure. By not renewing the infrastructure, which must be done regularly, it created a deficit there very much as real as a deficit in the bank account. This now has to be caught up and the money spent all at once or in the future, rather than the time that the government was cutting its spending.

I agree with the member for St. John's East, soon to be a minister, when he says that we oppose the motion which would basically cut federal taxes but increase provincial taxes. To me it is very simple. This is a matter of accountability and management control and by doing the infrastructure route now, where the municipalities, the provinces and the federal government all share in the decision making process and also the funding process, there is much more control, accountability, much more value for the taxpayers and much more input for the people in all areas that are affected if all three levels of government have input into the situation.

However, the proposal would say that all of the money goes to the provinces and the provinces would make all the decisions. The municipalities and the federal government would be out of the loop. That would leave the door open for a lot of abuse, political or otherwise, or just bad decisions. It would leave municipalities with no input whatsoever.

Municipalities are facing some of the gravest challenges in infrastructure. I was thinking about what has happened over the years as a result of this debate. During my first term in the House from 1988-93 there was a program called the federal-provincial highways program. It was a great program where the provinces and the feds agreed on funding for highways.

Many highways were upgraded, approved and built in Atlantic Canada, highways which saved lives, made us competitive, allowed us to get our products to market and made us competitive and part of Canada. However that whole program was done away with by the Liberals. It was sorely needed and still is sorely needed.

Very little money has been spent on highways in Atlantic Canada. Again, it is a deficit. It is probably the same in the rest of the country but I know I can speak firsthand about Atlantic Canada.

My second thought has to do with how the system is better served by an infrastructure program that has federal, municipal and provincial governments on side. In my own riding there is a highway that is very dangerous. This highway has had more fatalities than any other highway in Atlantic Canada. It runs through the Wentworth Valley which happens to be in my riding.

The federal Conservative government signed a federal-provincial agreement with the Conservative government in Nova Scotia. The agreement said that 50% of the total costs would be paid by the federal government and 50% would be paid by the provincial government. It would then be 100% paid for.

Then there were two elections. Both the federal and the provincial governments changed and the Liberals came in. Two ministers, one federal and one provincial, took half of the money from that program,which was designated specifically to pay for the upgrading of that dangerous highway, and moved it to their own ridings 200 kilometres away. It had nothing to do with the national highway program under which this money was made available.

This was in black and white and still is. The commitment was there to pay 100% for that highway and these ministers deducted half of the money and took it to their own riding in Cape Breton. These ministers both shared the same riding and wanted a highway along the seashore. They took this money from my highway, which was known as death valley, and put it in their own riding. I believe that is an example of abuse.

However, if the municipality had been a party to this agreement, it never would have happened. The reason we support the infrastructure program is that it has municipal, federal and provincial input and this sort of abuse cannot happen.

However to replace the highway money that was committed by the federal and provincial governments, they established tolls. We are paying tolls today because that agreement was abused. We will be paying tolls for a long time because millions of dollars were taken out of that agreement and moved to another highway which did not qualify under the federal-provincial agreement whatsoever.

The money was supposed to be specifically restricted to highways in the national highway system. This was a tourist road in Cape Breton. It had nothing to do with the national highway system. However, one federal Liberal minister and one provincial Liberal minister were able to take the money and transfer it out of the program for which it was originally designed.

For these reasons: because of the accountability, the co-management, the better value, and because it restricts abuse and ensures input from the municipalities, we support the present infrastructure program which does involve the three levels of government.

We would like to see longer term commitments so the municipalities can plan over 10 or 15 years the projects they will deal with, and the provinces can make plans for their projects which need work done. The priorities change as people evolve, as people move and as communities change, but they need to know that money is there so they can deal with them.

We agree with one of the concepts of the motion but we do not agree with the way it would be implemented. The concept that we need stable funding, is the concept that we agree with.

I agree with the very distinguished member for St. John's East. We do have a requirement for infrastructure investment which is now in a deficit. We do need to make it up now but we would prefer to see it done through the three way program of municipal, provincial and federal funding.