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House of Commons Hansard #24 of the 37th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was money.

Topics

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4:45 p.m.

Bloc

Mario Laframboise Bloc Argenteuil—Papineau—Mirabel, QC

Mr. Speaker, I would just like to get one thing across to my colleague, the Liberal member for Edmonton Southeast.

In Alberta, the province is responsible for health care. He must be aware of what the province invests in health care, year in and year out. I am sure he also understands that the people of Alberta very much prefer the province to be responsible for health care, rather than the federal government, since they have had the opportunity to see how the feds handled the firearm registry, which had $2 million allocated to it and will end up costing $2 billion—

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4:45 p.m.

Bloc

Monique Guay Bloc Laurentides, QC

And still counting.

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4:45 p.m.

Bloc

Mario Laframboise Bloc Argenteuil—Papineau—Mirabel, QC

And still counting. My colleague from Laurentides is absolutely right. There is no doubt that the people in Alberta are perfectly okay with the province being the one to invest in health care, rather than the federal government.

My question will be a simple one. We are not the ones who came up with that 16% figure; it is in all the ads running in Quebec and in the rest of Canada. As for the provinces who financed those ads, I can see on the one I have in front of me that Alberta is listed on the far left, as the first one to have funded it. It states that the federal share is 16%, and that the objective is 25%, as established by the Romanow commission. The province of Alberta no doubt has its own figures.

So when the member says that the numbers are wrong, that it is 40%, that is tantamount to saying that Alberta Premier Ralph Klein is lying to the people of his province.

So that is my question. Is Mr. Klein lying to the people of his province when he says—

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4:50 p.m.

The Deputy Speaker

Order. I hesitated before when the word “lie” was used. I am not comfortable with that word. I will not ask that it be withdrawn, but, if I may, for the rest of this debate, I will ask that members find other words that I would consider more appropriate in the parliamentary context.

The hon. member for Argenteuil—Papineau—Mirabel.

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4:50 p.m.

Bloc

Mario Laframboise Bloc Argenteuil—Papineau—Mirabel, QC

Mr. Speaker, I will try to do better.

Is the Premier of Alberta, Mr. Klein, telling the truth to his people when he says that the federal government is only paying 16% of health costs?

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4:50 p.m.

Liberal

David Kilgour Liberal Edmonton Southeast, AB

Mr. Speaker, I have no trouble accepting, as my colleague said earlier, that Quebec residents prefer that the provincial government be the one spending health money.

However, in my province, Alberta, opinion is divided. I have seen surveys showing that Albertans distrust both levels of government.

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4:50 p.m.

Canadian Alliance

Deborah Grey Canadian Alliance Edmonton North, AB

Hear, hear.

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4:50 p.m.

Liberal

David Kilgour Liberal Edmonton Southeast, AB

I thank the member; she is too kind.

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4:50 p.m.

The Deputy Speaker

I know this subject matter is important to every Canadian in each and every province, and I know there might be a certain consensus among Albertans, but I know the member for Edmonton Southeast will want to continue his intervention through the Chair.

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4:50 p.m.

Liberal

David Kilgour Liberal Edmonton Southeast, AB

Mr. Speaker, it seems that it is working well. Things are not perfect of course, but, for the time being, it works well when expenses are split between the two levels of government.

If the present situation means that the federal government is paying 40% of health expenses, of course the other 60% are paid by the provinces. It seems that everything is working reasonably well.

I imagine my colleagues will rise to their feet and tell me that this is not the case for Quebec residents, but I will wait for them to speak later.

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4:50 p.m.

The Deputy Speaker

I am sorry but the member's time has expired.The Parliamentary Secretary to the Minister of Finance.

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4:50 p.m.

Scarborough East Ontario

Liberal

John McKay LiberalParliamentary Secretary to the Minister of Finance

Mr. Speaker, I am sure those who have been watching the debate thus far have been somewhat overwhelmed by the flurry of numbers that have been going back and forth in this debate. As you rightly point out, Mr. Speaker, this is an important issue to Canadians, but it is important that Canadians also have the facts in front of them in order to adequately assess this issue.

The debate springs from the motion of the hon. member for Joliette who says that the contribution by the federal government is inadequate. He sort of leaves that word inadequate hanging out there, and he gets to a point of inadequacy by apparently ignoring a lot of money.

I thought I would first start off with the issues around the so-called fiscal imbalance which underlies this debate. I would bring to the attention of the House that in the fiscal year 2002-03, which really is the only one for which the final numbers are available, the revenue of the federal government was about $177 billion. Interestingly, for the same year, the revenue for the provincial governments, as a collective, was about $166 billion.

Therefore, on the first question of fiscal imbalance of an $11 billion difference between the two levels of government, the national and the sub-national governments, that hardly strikes one as an imbalance, especially given the numerous own-source revenues of the provinces to tax their citizens as they see fit and to set tax rates as they see fit.

That so-called fiscal imbalance of $11 billion though gets somewhat redressed by federal transfers to the provinces. In that year the transfer amounted to about $34 billion. That has two effects on the so-called imbalance. It reduces the federal moneys available for its programs, its debt servicing and transfers to persons, et cetera, by that $34 billion. Therefore, what is available for the federal government's issues and needs is about $143 billion.

Not only do we take away that $34 billion from the federal revenues, we add $34 billion to the provincial revenues. Therefore, at the end of the day, after those transfers are done, the provinces have just a slight touch over $200 billion to address their needs, which we would even argue are legitimate needs, including health care, but the federal government only has $143 billion to address its jurisdictional areas. That is the first thing.

I would put it to the House that this does not look like much of a fiscal imbalance to me. When we add those two numbers up, the provinces have way more money than they are letting on to the rest of us. They would have us all believe that the needs are there and the money is here. The needs may well be there, but the needs are also here. The money is also there, but not as much money is here.

The second point is this. Over the course of several generations, the federal governments ran up quite a debt. Even after all the hard work that we put in to reducing the debt, we are still at $510 billion, give or take. The provinces do not run nearly the debt level that the federal government does. At one point we were up to $568 billion, and I think that is about as high as it got.

After a great deal of hard work, we are down to just over $500 billion after running seven years of surpluses, after running a very tight ship. So here we are, running a debt of about $500 billion, while the provinces, on the other hand, are running at quite substantially less dollars in terms of debt.

The federal government started out at about 28¢ out of every dollar going just toward the debt. Now we are down to 21¢ out of every dollar going just toward the debt. Meanwhile, the provinces only pay 11¢ out of their revenues to service their debt.

Where is the fiscal imbalance there? It seems to me that the fiscal imbalance is somewhat on the other side, is it not? Maybe a little light is going on over on the other side there: that maybe the fiscal imbalance is on the other side of the equation rather than on this side of the equation.

I know that the hon. member for Edmonton North is not particularly good with figures, but nevertheless, we have a government to run over here and we have to balance our books. We have done that for six years. I hope that we possibly might even do it for a seventh year. But we still have that enormous debt.

So where is the fiscal imbalance? I dare say that a fair-minded analysis might put the fiscal imbalance on the other side of the equation rather than on this side of the equation.

The second thing I want to talk about in terms of the exercise of fun with figures is the repeated insistence on the part of members opposite to ignore the tax points as part of money that apparently does not exist. Apparently $17 billion simply does not exist. The provinces say, “It is ours, it always has been ours, and we are not going to count it as ever having been the federal government's”.

That makes the federal government ask itself why it should create room in its tax system for the provinces to take money out of it in order to claim it as their own and simply ignore it as a contribution by the Government of Canada to the people of Canada. We have to ignore that.

We repeatedly hear the argument from members on the other side that the $10 billion in equalization money, which apparently is not real money, is somehow or other money that they should keep and ignore. Half of that goes to the hon. member's province. Members on the other side get into some really interesting arguments. One is that somehow or other not only should this money not count, but they object that it flows in a per capita way.

Let us think about that. The argument on the other side, then, is that money should go to where the people are not and money should not go to where the people are. Thus, we should ignore the 2001 census and send money to where there are no people and not send money to where there are people. So where the needs are, we do not send money. That is an interesting basis for formulating a government policy. I thought that was a particularly strange argument coming out of the equalization argument.

Of course the third argument they choose to ignore has to do with moneys that are directly spent by the federal government on health. Again, either this money exists or it does not. Either the health care needs of certain subsets of Canadians are being covered by the federal government or they are not being covered. To simply ignore this makes it very difficult to enter into forms of partnership and understanding.

I would hope that part of the meeting of the first ministers and the finance ministers would be some basis for understanding that the federal government actually does flow a great deal of money into the coffers of the provincial governments and that this so-called fiscal imbalance and these needs on the part of the federal government for debt servicing just simply cannot be ignored. Let us think about this. Every 21 cents that comes into the federal government's hands has to service the debt.

The good news part of the whole thing is that our debt to GDP ratio is actually declining from a fairly high figure of around 68% down to 44% and possibly, in terms of actual money that we pay out, to 38% of GDP. The federal government has made significant progress and I appreciate that we have worked very hard on that.

I wanted to address some of the other issues that came up in the course of the debate, if I may in the one minute that I have. I will point out that the 2003 budget confirmed $34.8 billion in increased funding to meet those goals. I wonder where members opposite were when that budget was passed. As a result, total cash transfers--and I am emphasizing cash, I am not even arguing tax points--to the provinces will rise from $19.1 billion in 2002-03 to something in the order of $28 billion in 2007-08. This is faster than the rise in the projected GDP. It is faster than the government's revenues will appreciate.

The Government of Canada has committed itself to cash transfers where it will have to sacrifice other priorities in order to meet those cash needs, which is a recognition, frankly, of the health care needs of Canadians that we actually heard about on our cross-country travels.

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5:05 p.m.

Bloc

Paul Crête Bloc Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC

Mr. Speaker, I came close to falling off my chair when I heard that the provinces rather than Ottawa might be behind the fiscal imbalance.

At the end of a long day when a lot of figures have been tossed around, I think it would be pertinent to question my colleague on this. Are we not in a situation where the federal government is going to have an $8 billion surplus, while in the same fiscal year, seven of the ten provinces are close to a deficit? Is that not an inescapable fact?

In his own argument, he gave us an answer which, I think, is meaningful and pertinent. He said that our debt to GDP ratio has declined from 68% to 44%. In fact, the consequence is that this government has to make the choice, now that its ratio is at an acceptable level, to direct more money to the debt or to adopt the motion before us and put one half of the surplus into health care and the other half on the rest.

Did the hon. member not use, in his own speech, an argument that should convince him that the Bloc's position, supported by all the opposition parties and the provinces, is the right one? Should he not remember, in particular, that the progress made in debt to GDP ratio is the result of the cuts the federal government imposed on the provinces, on the backs of the unemployed? When he says that hard work was done, I say to him that the federal government made other people work very hard.

The current federal government has arranged things so that many provinces have had to make cuts in health care. That has repercussions as far as the home care provided to seniors and basic services in emergency rooms. These are the people who have worked very hard so the federal government can get its ratio down to a reasonable level. Is it not time for the hon. member and the government over there to get beyond the idea of the ratio and ensure that the government does its part to finance health care, as all of Quebec and all of Canada expect of it?

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5:05 p.m.

Liberal

John McKay Liberal Scarborough East, ON

Mr. Speaker, we would have another health care need if the hon. member fell off his chair. I would not want to have to carry him out of here. I would not want to see his health impaired by this debate.

I am not quite sure where he gets this business of an $8 billion surplus. I hope it is true, but it is what I call The Globe and Mail surplus, because the numbers that are available in the public domain project a much smaller surplus.

I would remind the hon. member that the Province of Ontario in particular had a serious meltdown in its GDP. Because the Province of Ontario is the most significant province in terms of contributing to federal revenues, when that province has a meltdown in its GDP it affects our revenues. Our GDP fell from 3.5% to 1.7%. When it did that, we actually had to cut into contingency money in order to be able to cover the bills.

This speaks to the point of why we build contingency into our budget: so that in the bad times we have covered off the bills. In the good times if those moneys are not needed, then we use those moneys to pay down the bills. It is a strange concept to the member opposite, but on this side we try to live within our means.

We have succeeded in going from 68% to 44% in terms of percentage of GDP. Frankly I think that is good news. I do not know why the hon. member wants to spend his brains out. We are on the right track. We are the only G-7 nation that is actually going to balance its budget this year. We are the only one in the OECD that is going to carry a modest surplus. I think that is good news and good fiscal management. It addresses the issue of why we can actually contemplate spending $2 billion specifically on health care, Canadians' number one priority.

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5:10 p.m.

Bloc

Monique Guay Bloc Laurentides, QC

Mr. Speaker, first, I want to read the motion again, since I will be the last speaker today. Our motion reads as follows:

That, as the federal government's 16% contribution to health care spending is clearly inadequate, this House urge the government to invest at least half the current year's surplus in health care, over and above the $2 billion already promised, in order to achieve as rapidly as possible the stable 25% federal contribution called for by Quebec and the provinces.

We are not the ones saying that the federal government is contributing only 16%; the experts and provincial representatives are saying this. The message of the provinces' big ad campaign is that the federal contribution to health care should be no less than 25%.

It is totally unacceptable to see people in every province pay such high federal taxes when there is no return in health.

We know that the top priority is health care. Health is our top priority in Quebec, among others. I said earlier, when I asked a question, that in my area, a Montréal suburb, during a 48-hour period, people had to be transferred to hospitals such as the one in Joliette or elsewhere, because emergency care could not be provided. This is unacceptable.

That is the problem. The transfer payments are not enough. The $2 billion amount was agreed upon. As my colleagues also pointed out, I could not say how many times it was announced, since it was done so often. It is now a done deal. We know that this $2 billion was given to the provinces. But they need more.

We know that there will be a very large surplus. In any case, each time there is talk of a surplus, the federal government always underestimates and then ends up with a much higher amount. Annual surpluses should go to the provinces. We are only asking for a part of the surplus to go to the provinces.

It is true that the debt has to be paid down. We agree with that. This is not the question. Of course it has to be paid down. However, the urgent and pressing health care needs of the provinces also have to be taken in into consideration.

The Quebec government is spending most of its budget on health care, and this expenditure is increasing every year because we can never see the light at the end of the tunnel. The Quebec Minister of Health announced this week that he would not be able to solve the problem in the next two or three years because he did not have enough money. And money does not grow on trees.

I would like people to realize that the government has nevertheless accumulated considerable surpluses. It also cut the employment insurance fund. Let us face it. This is the reality people are confronted to every day. Appropriate measures have to be taken, especially for health care. Health is a priority. It is a vital priority. Without health, we are going nowhere. Health should be the priority. The next time government runs a surplus, it will have to be invested where it is needed.

According to our motion, all provinces should be getting at least 25% in transfers. Then, we can start thinking about a way to overcome our current problems.

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5:10 p.m.

The Deputy Speaker

It being 5:15 p.m., pursuant to order made earlier today, all questions necessary to dispose of the business of supply are deemed put, a recorded division is deemed demanded and deferred to the end of the period provided for government orders on Monday March 22, 2004.

Would the House agree to see the clock as 5:30 p.m.?

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5:10 p.m.

Some hon. members

Agreed.

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5:10 p.m.

The Deputy Speaker

It being 5:30 p.m., the House will now proceed to consideration of private members' business as listed on today's Order Paper.

Income Tax ActPrivate Members' Business

March 11th, 2004 / 5:15 p.m.

Bloc

Paul Crête Bloc Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC

moved that Bill C-303, An Act to amend the Income Tax Act (travel expenses for a motor vehicle used by a forestry worker) be read the second time and referred to committee.

Mr. Speaker, it is a great pleasure to be able to deal with this bill in the House a few days before the budget is tabled. This is the third time I have raised this issue. For the information of the hon. members, I would like to explain once more the situation of forestry workers in Quebec and Canada.

Here is a concrete example from my place. In my riding, some people have to go to work for a week at a time at the other end of the province. I live in the Lower St. Lawrence area, and people there go to work in the forestry industry in Abitibi, on the North Shore, or some place else. Their vehicle is essential to their job. They use it to get to the area concerned and for their work once they get there.

We have realized that, in the present situation, with no income tax deduction for these workers, there is not an incentive to go to work. In the situation we have now, with the lumber crisis and enormous pressure to drive down the cost of labour, a worker does not have much left at the end of the year.

The situation is the same for everybody, for those who work in the forest and for those who work in plants. All those involved in the forestry industry at this time in Canada are having a hard time, particularly with the softwood lumber crisis. There is less and less money to support families.

In 2000 I wrote to the then finance minister, who is now the Prime Minister, to ask him to consider the possibility of restoring tax fairness for those people. I met with people from my riding, but I realized that similar situations existed throughout Quebec, particularly in the forestry regions. There are people in these regions who work in forest management territories. These territories have shrunk because there is less cutting going on. This forces workers to travel further to find work. In so doing, they have to assume heavy costs that are not tax deductible.

In February 2000, I wrote the Minister of Finance, who is now the Prime Minister. This is what he said in his response:

What constitutes a reasonable level of expenses for motor vehicles is a complex issue that requires a thorough study. The review of this issue and of other components of the tax system concerning motor vehicles is still going on. We will inform you of the results as soon as it is completed.

This letter was dated June 2, 2000. At the time I expected a response in the subsequent months and that the situation could be corrected in the next budget if the government decided to follow up on my request. Moreover, the bill I introduced at the time would have improved matters. I had hoped the government would support it in order to help forestry workers.

Unfortunately, the then finance minister, the new Prime Minister, never deigned to follow up on the response he had given before. When he said, “We will inform you of the results as soon as it is completed”, I would have expected to receive information, but it never came. We never received it. I had to do additional research.

The Income Tax Act is very clear in the interpretation:

At any time, the distance admissible as an employment expense is the distance between the employer's office and the forest camp office and the cutting site, provided the forestry worker received instructions at the office or the camp. At no time is the distance from the worker's home to the stump admissible.

So people are put in the position of having to use a motorized vehicle, something essential to their work and required of them by their employer. They have to use it to get to their job, which is often hundreds of kilometres away, but get no tax deduction for this. The cost of this vehicle, one that is often hard on gas, is quite high because a person needs a powerful vehicle for that kind of terrain.

So all the expenses to get to the work site weekly, once calculated from the mathematical and economic point of view, may convince them that it is not worth going to the job. So society ends up with people on its hands who would rather be working but are instead remaining unemployed and sometimes end up on welfare because they are in an area where there are no jobs or opportunities to make use of their skills.

For that reason, I hope that Bill C-303 which we are discussing today will gain the support of most of the members of this House. The other times it has been debated here, some were in favour and some were not. Unfortunately then we did not have the outcome of the studies undertaken by the Department of Finance available to us.

Today we have a budget coming very shortly. As hon. members know, there are forestry workers who have to sweat to earn a living. Yet they see the federal government once again with an $8 billion surplus. They have to cope with a very restrictive employment insurance program, and often are unable to get enough weeks of benefits on top of the weeks they have worked to ensure them of some income all year.

In the cases that I am talking about, forestry workers who often work away from home find that it is unacceptable that a government that has such a huge surplus does not encourage them to work when they want to do their job and, indeed, this job must be done. There may be a manpower shortage. This is absurd. There are people who would be available to do this work, but they cannot, because the financial bottom line will be negative if they have to go to work and pay for all the costs.

It is this situation that the current bill is designed to correct. I hope that it will be passed and that the tax laws will be changed accordingly. There must also be a different interpretation of the regulations, so that workers who want to work, who want to make a living and who are forced to travel long distances do not have to support a portion of the cost, which is unacceptable.

In conclusion, I would like to say that I expect members of this House to be particularly sensitive in these times where, because of the softwood lumber crisis, people are going through very tough situations. The financial survival of families is on the line. Often, this situation, this imbalance, this lack of acknowledgment of the tax expense means the difference between maintaining the independent small business, self-employment and quitting the job.

This is why I would like forestry workers to get the acknowledgment they deserve. I would also like them to be given the satisfaction of being able to work, of bringing an income home and of supporting their family. They have developed skills in this sector, and employers are waiting for them to do the work that must be done.

Income Tax ActPrivate Members' Business

5:20 p.m.

Bloc

Mario Laframboise Bloc Argenteuil—Papineau—Mirabel, QC

Mr. Speaker, I am pleased to acknowledge the efforts of my colleague from Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques, who has the interests of his constituents at heart. This bill does not concern only his riding, but all the ridings where the forest is harvested.

First, it is important that the Liberal government understand one important thing about the softwood lumber crisis. The Liberals have been telling us repeatedly in this House that negotiations are ongoing with the Americans, that we are making progress, that an agreement will be reached, that it is forthcoming. Naturally, it is never their fault when things do not work out. The Liberal Party could buy-in to this type of agreement that is acceptable and feasible. We in this House can support the hon. member's bill and give a tax credit to forestry workers who use their vehicles for work.

We have to understand that forestry workers travel great distances. They need good vehicles, often four wheel drive vehicles, to be able to reach their work place. We have to understand how it is for them. Road conditions in the forest, particularly in bad weather, have to be taken into account. When travelling, these vehicles are put to the test.

I cannot conceive that members of this House could deny a tax credit to workers using their own vehicle as a tool. I would hope that, at a time when these workers are going through a crisis, we can show some sensitivity. It would be a good opportunity for all the members in this House to support the forest industry by approving the tax credit requested by my colleague. I would like my colleague to tell us what he thinks about that.

Income Tax ActPrivate Members' Business

5:25 p.m.

Bloc

Paul Crête Bloc Kamouraska—Rivière-Du-Loup—Témiscouata—Les Basques, QC

Mr. Speaker, my answer will be brief. I thank my colleague for his support.

Let me remind the hon. members that we went through a similar process in the case of mechanics' toolboxes. That bill was put forward by the hon. member who is now the whip for the Bloc Quebecois. He had to put it forward twice, but he finally won his point.

That is what encouraged me to be persistent, so that the same result can be achieved in this case. I hope that all members who need information on the issue will come to see me before we vote, to get a clear understanding of the reality.

However, I hope most of all that the next budget will follow the example of this bill and that this inequity will be rectified as soon as possible.

Income Tax ActPrivate Members' Business

5:25 p.m.

Liberal

Derek Lee Liberal Scarborough—Rouge River, ON

Mr. Speaker, I am pleased to address the House today on the private member's bill introduced by the hon. member for Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques.

Bill C-303 proposes to amend our Income Tax Act to provide a tax deduction for automobile expenses that forestry workers incur when they travel to work sites that are far away from their homes. Let me recognize right off the bat that the hon. member is attempting to address the needs of that particular workforce. He clearly will have a large number of individuals working in that field in his constituency.

The proposed bill would cover three kinds of expenses. First, it would cover daily out of pocket expenses for operating a motor vehicle. Examples of such costs are maintenance, gasoline and insurance. It would also cover interest charges on borrowing money to acquire a vehicle. Finally, it would cover depreciation costs. At the core, the bill gives a special package of tax benefits to a narrow group of employees.

We are all parliamentarians and Canadians here. It is incumbent on all of us to make sure that we uphold the fundamental principles of fairness and equity in public policy matters and in taxation matters.

I want to try and do my part here recognizing the hon. member's bill, the principles embedded in it and these other principles of fairness and equity.

The bill provides tax relief for only one kind of employment expense, that is, long distance commuting, and only when it is incurred by one kind of employee, that is, a forestry worker. Providing tax relief on this type of isolated, arguably ad hoc basis is problematic from the public policy point of view. Let me raise some concerns about that approach and which may have been overlooked in this bill as it was drafted.

For starters, we know that other groups of employees incur exactly the same kind of commuting costs as forestry workers do. People who work in construction or in the oil and gas sector are obvious examples. They often travel large distances to work sites. I am sure there are other examples as well.

We know that all employees no matter where they work incur some form of a mandatory employment related expense. I could give some examples. There are tools that are purchased by tradespeople: saws for carpenters, paint brushes for painters, hair dryers for hairstylists, some very expensive knives for those really good cooks. There are computers which are purchased by employees for working at home, monitors, hardware for the computer's hard drive and software and there are costs associated with that. Last, a common expenditure is safety clothing purchased by construction workers.

Clearly, employment expenses such as these ones can vary in their nature and their amounts. What strikes me is that there seems to be no reason that one group would be more deserving than any of the others in access to an employment expense deduction.

There is no doubt that employees who incur such expenses would be justified in asking for comparable tax treatment. However, if we were to introduce a general $500 deduction to recognize the broad array of potential employment expenses out in Canadian society, that would mean $1.3 billion per year in revenue forgone in the tax system. Recognizing all the employment expenses beyond the $500 would cost much more in lost tax revenue.

In addition, once we have opened up the door to this type of employment expense, we might not, in fairness, be able to stop just there. For example, there are various types of volunteers in Canadian society who have requested tax relief for their out of pocket expenses. These would include, for example, people who volunteer to provide emergency services and who incur vehicle expenses when they travel to an emergency site or when they go for training. Others include volunteer coaches for sports teams who might drive to practices and volunteers who deliver food and other materials to shut-ins.

Volunteers contribute substantially to our society and their efforts are valuable to all of us. However, extending tax relief to all volunteers and employees in a like fashion would be a very significant undertaking. Statistics Canada reports that there were some 6.5 million volunteers in Canada in the year 2000. Giving each of them a $500 tax credit would cost hundreds of millions of dollars in forgone tax revenues.

In closing, I am concerned about the apparent inequities that the bill would create. I am equally worried that it would place us on a slippery slope of providing unaffordable tax relief across a broad range of as yet unidentified workers.

In light of these shortcomings, I personally will not be supporting the bill. I do commend the hon. member for attempting to address a perceived need in the tax system and while I personally have not found a way to address it, I appreciate his efforts on behalf of his constituents in trying to do it with the bill.

Income Tax ActPrivate Members' Business

5:30 p.m.

Canadian Alliance

Chuck Strahl Canadian Alliance Fraser Valley, BC

Mr. Speaker, it is my pleasure to speak to Bill C-303 which I believe is a nice gesture, a nice thought toward helping forestry workers. I was once a forestry worker. I was a logging contractor for many years before I got into this business.

I know exactly what it means to try to help a forestry worker in his travelling duties. In my case, on a typical day I would spend three and a half or four hours in a pickup truck to get to and from work besides whatever I drove at work. Travelling in the forestry business is an expensive part of the job and there is just no getting around that.

Unfortunately, the problem with the bill is that it addresses one aspect of employee expense. It does not recognize that other employees have similar expenses. For example, construction workers in my area might live in Chilliwack but they have to drive to Vancouver for their daily work. They drive two and a half to three hours a day as well. The bill does not address that. As soon as we start making laws for one group of workers, we have to make it across the board.

The bill tries to address an obvious problem facing the forestry industry. We have to talk about the root of the problem. What are the big problems for forestry workers?

In my neck of the woods there are three or four things that affect them directly. One is the failure to resolve the softwood lumber issue. In British Columbia that issue has caused more dislocation, more unemployment and more problems especially in our rural communities than any other issue. It needs to be resolved. It needs to be resolved at the highest level.

It needs to be a priority for the government or any government to fix and repair our damaged relations with the Americans. We have to get the softwood lumber agreement fixed. I would add that there are several of these agreements, whether it is the problem with BSE, the problem with durum wheat, and now the possible problems with the trading of pork. Many of these are north-south problems with the Americans. We simply have to find a better way of sitting down with our American partners and talking these things through before they become a crisis. Right now we seem to have a crisis management system and it is not helping forestry workers or anyone else.

The government recognized this issue a long time ago. It can be found on the Industry Canada website, the implementation of the softwood industry community economic adjustment initiative. It is a long term for saying there is supposed to be some cash for the communities that are particularly hard hit.

My riding has a new part, and I hope to be the member of Parliament after the next election, but the new riding boundaries go up the valley, up the canyon into Boston Bar and over to Pemberton. I met with officials in those towns. They cannot get any money through the community futures program and through the softwood industry adjustment initiative to the communities that are most affected.

In some cases there is a 70% to 80% unemployment rate. If they could get some money they could start these community forest programs, something which the provincial government is in favour of, but they need some help. The softwood industry adjustment program is supposed to help them and the money is simply not getting through to them.

I refer to an article in the Vancouver Sun of March 6, regarding $55 million of the federal program to assist B.C.'s hardest hit communities, forestry communities, small communities such as the ones in my riding. It states:

But a series of bureaucratic mistakes, changes in rules, turf wars and a confusing array of approval processes all combined to delay the program so much that it was only this week--a month before all the money was supposed to be handed out--that the first small amount approved for programs has trickled out of the government.

In other words, half of all the money in the federal government's softwood lumber initiative was supposed to go to British Columbia, which was the hardest hit. The money would help the smaller communities, such as Boston Bar, Hope, Pemberton, Lillooet and so on, which have already been hit hard for a bunch of reasons. However the government has not been able to design that program for a variety of reasons to get the money into the hands of the people who need it, which is a travesty.

The people have firm proposals. They showed me those proposals again last week when I was up in Boston Bar. Their programs are detailed and firm and have the approval of the bank, the community, their elected official and the province but they cannot get the money from the federal government.

The money was targeted especially to help those communities and it is just a shame when nothing happens. It is not acceptable, especially when it targets one region in the country that needs a little bit of help. The program is on the website but my people back home are saying that they cannot get access to it. Those funds, more so than a travelling allowance, is what these people need.

I would suggest that the other thing we should consider here is the whole employment insurance program. Not only does the employment insurance program consistently overtax people who are in the forest industry, but when they are laid off due to softwood taxation and tariffs and so on, it sometimes takes months and months to get their first EI cheque.

No one wants to live on EI. It is tough enough to live on EI when one is raising a family and so on but when people are paying into that program they expect and have the right to get that money back from the EI program, to quote the Deputy Prime Minister, in a “timely fashion”. When they apply they should not have to wait two to three months to get their first cheque. In our neck of the woods when workers are laid off for winter or because the mill shut down or whatever, there is no question that they are laid off. There is no other work in Boston Bar. It is a one industry town.

When workers who are laid off make their application, they sometimes wait for two to three months before they get a cheque in the mail. That is unacceptable. Not only are employers and employees overtaxed on the EI contributions, but when the workers try to draw from the fund, which is supposed to be for a temporary loss of job, they sometimes do not receive the money for a couple of months.

I have had people come to my office who are at wits end. They do not know what to do. They thought the program would tide them through the winter or maybe put some groceries on the table, and even if they could not pay their mortgage they thought they could somehow survive, but all of a sudden they find they have to wait two or three months for a cheque.

When people are living paycheque to paycheque in an industry that is open and closed, like the forestry industry, two months without any income in a one industry town, is cruel and unusual punishment. It is just not acceptable. I suggest the government look at its management of the EI system as well.

Is there a better way to help forestry workers overall? I do not believe we can just target one group of people and help with their travel expenses. If we are considering that, then we must include the forestry workers, the construction workers, the people who have to follow the jobs like my dad, who passed away, used to do. We would have to do the same thing for those in the oil patch and many different occupations. It is not like working at an auto plant in Oshawa where one knows the plant is right there and it is not moving anywhere. It is a different kettle of fish.

I believe we have to address this thing holistically. It means broadly based tax relief for all Canadians who are looking for some help. We want to specifically help people on their personal income tax, allowing them to reduce the amount of taxes paid. We need to stop the gouging in the EI system. We need to ensure that the money goes to the people who need it in a way that helps them out properly.

We want to restore proper relations with the Americans on these important tariff related border issues. By all means we can get tough when we are talking to the Americans but let us not get silly with the bad mouthing that I hear all too often in Canada toward our American friends and people who buy our goods and so on. Let us fix that.

Finally, we need to make sure that the funds that are supposed to get to the workers and these communities through the WED, through the community futures program that administers it, actually get to them. It is not good enough to say that the funds should have come, that we wish they had not been held up in the pipeline. These people need the help they were promised by the federal government. The program is in place. Let us make sure the money gets through to the workers who really need it today.

Income Tax ActPrivate Members' Business

5:40 p.m.

NDP

Peter Stoffer NDP Sackville—Musquodoboit Valley—Eastern Shore, NS

Mr. Speaker, I want to acknowledge that we in the New Democratic Party fully support the initiative of this bill and we will be voting in favour of it when it comes up for a vote.

However I do want to agree with the tail end of the speech by my colleague from British Columbia concerning the problems in the forestry industry. We believe the government should be attacking the softwood lumber crisis in a three-pronged attack.

First is the stabilization of the forestry workers in their communities by ensuring that those funds get to where they have to be. To delay it through bureaucratic means is simple nonsense, and that needs to stop right away.

Second, the government needs to go into the United States and, with their allies in the U.S. who are supportive of our initiatives, work toward changing the minds of those congressmen and senators.

Third, the government needs to continue the attack through the legal challenges of NAFTA and the WTO.

I have a very simple question for the member. When it comes to business deductions and expense deductions, what is the difference between a toolbox and a laptop? A business person with a laptop can travel across the country for his or her business and deduct those expenses, but a worker with a toolbox cannot. That has to change.

Although we do know what the member from the Conservative Party is saying, that this just targets one specific section of one specific set of workers, the fact is that we have to start somewhere. I am sure the hon. member from the Bloc would love to have included all kinds of people, like carpenters, metal workers, name it.

We have a tremendous amount of people who leave Atlantic Canada and move to the oil patch but they cannot write off their traveling and meal expenses, et cetera. However if they were accountants or lawyers they could write off those expenses. All we are asking is that there be a little fairness in the taxation system.

The Bloc member has done it very strategically. He has taken one section of the occupational workforce and one aspect of the tax deduction in the motor vehicle. We know this is a start, and no, it does not include all other workers at this time, but in opposition, sometimes we have to throw the Liberals a bone. Hopefully they will chew on it a bit, like the taste of the marrow and run with it, which is really what is required. We want them to say that it actually makes sense. We want them to ask what the difference is between a toolbox and a laptop.

My colleague from Yukon knows how many people travel up and down the Dempster highway, the Alaska highway and the Campbell highway to and from their jobs. If they are business people they can write off their mileage as an expense, but if they are forestry workers they cannot. We fully support the initiative of the Bloc member in this particular regard.

However, at the same time, we would like to see the government move fairly quickly in terms of including many other workers who come from here. We have workers from Nova Scotia, in the building trades for example, who have been asking for quite some time to be included in budgets, to be given the opportunity to deduct their meal expenses, their vehicle transportation costs and their lodging expenses. They do not want to sit at home and collect EI or welfare. They want to be able to follow a job somewhere else in the country in their trade because they have pride. However, if it is extremely cost prohibitive, if they cannot afford to get to a particular place, then they are behind the eight ball and that is unacceptable.

We need to allow these workers who wish to move to another part of the country, where they will have an opportunity for employment, to do so. We should be congratulating these people. We should be honouring the fact that they are willing to leave their homes in order to find work in other jurisdictions in Canada. We should be assisting them through the tax system so they are not prohibited from making that decision.

I do not want to be critical of the business community. If they are willing to move across the country and assist other businesses in their endeavours, that is great, but if they get to write off their expenses, then surely forestry workers should be allowed to do the same when it comes to their motor vehicles. When we as members of Parliament travel across the country to follow our critic areas, our expenses are covered.

We are just saying that if we are doing our job in terms of our constituents and the Canadian people, then we ourselves should apply those same types of principles to the workers of our country, especially to those forestry workers.

We thank the hon. member from the Bloc Quebecois for bringing this very worthy bill to the floor of the House of Commons where the debate should take place. We encourage the government and all opposition members to seriously look at this type of initiative to see where we can go forward on this to make it easier, especially financially, for workers who are transient in following their workplace.

Income Tax ActPrivate Members' Business

5:45 p.m.

Yukon Yukon

Liberal

Larry Bagnell LiberalParliamentary Secretary to the Minister of Indian Affairs and Northern Development

Mr. Speaker, I welcome the opportunity to join the debate on Bill C-303, sponsored by the hon. member for Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques. I congratulate the member for the bill, which is an effort to help out certain workers, who must travel far distances for work, with their expenses.

I first want to comment on a couple of items that were mentioned by the previous two speakers, the first being the softwood lumber issue. I basically agree with those speakers on the efforts that Canada is and should be taking on that file. I agree with the items they suggested and commend them to all members in the House. We have had several take note debates on that and numerous meetings with our opponents and friends in the United States to try to resolve the problem that is being caused by a special interest group. We are more determined than ever to do that.

The member of Her Majesty's loyal opposition mentioned EI. I just wanted to put on the record that the Canadian Federation of Labour has presented some very creative ways of using the EI fund for training, over 55 programs and other methods to make it more effective. I encourage the Minister of Human Resources to look at those.

Finally, in response to previous speakers, I also agree that the United States is our greatest trading partner. By geography it is right beside us and it has the disposable income. We can ship there cheaper than anywhere else in the world and we sell the largest number of products. It is therefore important to ensure a smooth relationship for our workers and our families in Canada.

On this particular bill, it appears the intention is to give a tax deduction to forestry workers. It would be a deduction for motor vehicle expenses that they incur for travel between their home and distant work sites. I understand why the hon. member for Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques would want to do something special for forestry workers. Forestry workers are the backbone of the forestry sector, a sector that contributes significantly to our economy. In 2002 alone, for example, forestry exports contributed more that $32 billion to our economy and our trade surplus. That is an important contribution indeed.

As I said, forestry workers are the backbone of this sector. Today, more than 350,000 hardworking Canadians are directly employed in this sector. In forestry and logging alone there are more than 75,000 jobs. This number is much higher when we count the people working in the wood and paper products industry or related industries.

Employment in the forestry sector is a major source of income that helps sustain many communities across this vast nation: communities such as Prince George, British Columbia; Le Pas, Manitoba; and Port Hawkesbury, Nova Scotia. Of course, I cannot forget that forestry is important to a number of communities in Quebec represented by the hon. member.

I also want to mention, for those who do not know, that we have a good forestry resource in Yukon. We have some tremendous white spruce and lodge pole pine trees. The grade on those trees is so fine, because some of them take 300 or 400 years to grow, that they are highly prized by the Japanese and other markets for their high quality and strong wood.

As the member mentioned, we do have workers who travel back and forth on the Dempster highway at great costs to get to their jobs. However there are no trees at the top of the Dempster highway, which points to what the government was saying, which was that there are all sorts of workers, who incur tremendous expenses to travel long distances, who would not be covered by the bill.

I also agree with the hon. member who just spoke, a former Yukoner I might add, that people should be congratulated for moving and should be helped out when they move for employment. In Yukon, to once again make the government's point, our economy is at a low ebb and a lot of people are temporarily moving right now. I congratulate them for leaving their homes to be positive contributors to our economy. However they are not moving to go into the forestry industry. Most of them are moving to go into mining and into the oil and gas sectors near us. Once again, this points out the government's point about fairness for these other sectors.

A strong forestry sector is an important element of Canada's future prosperity. That is why in May 2002 the federal government announced a five year $35 million Canada wood export program. This program brings together partners, the wood product associations, provinces, territories and the industry to work together to expand offshore export opportunities for Canadian wood products in traditional and emerging markets. Doing so will strengthen exports, increase economic growth and create jobs for forestry workers.

Therefore, I can understand the hon. member's desire to support forestry workers, but the bill is not the best way to do it. I might add that some of the items that the members in the debate have brought forward on how we can help them I fully support. I thought they were good suggestions.

However, as I said earlier, the bill proposes to give an income tax deduction for motor vehicles expenses that forestry workers incur to travel between home and distant work sites. Deductible costs would include the day to day, out of pocket expenses required to operate the vehicle. These would be things like gasoline, repairs and maintenance costs, insurance and licence fees. Forestry workers would also be allowed to claim depreciation on the original cost of the vehicle and they could claim interest costs associated with any loan taken out to acquire that vehicle.

The first issue I have with the bill is one of fairness. Tax rules should be fair not only to the taxpayers directly affected by change but also to other Canadians.

The bill would introduce special relief on commuting costs incurred by forestry workers. Most employees have to commute to work and incur costs in doing so. Some even have to travel relatively long distances to remote locations. As I said previously, forestry workers are not the only workers in this category. There are workers in the construction, oil and gas and the mining sectors and farmers who often work far from home as well.

I am not talking about moving expenses. I congratulate the previous member who spoke. He said that there should be support for moving expenses. There is a moving tax deduction in the Income Tax Act if one moves for employment.

However, despite the good intentions, the bill overlooks all these other employees whom I just mentioned; people who face the same kind of travel requirements as forestry workers. How can we justify providing a special tax concession that would only be good for one category of worker? In good conscience I do not think we could.

It is also worthy to note that the bill is unclear about who is included in the definition of forestry worker. Are cooks at logging camps considered to be forestry workers? Would a secretary working at a remote logging site be eligible? Why would we deny these workers tax relief when they incur exactly the same costs? It is a difficult situation, to be sure. Would a cook in another business who travels to work be eligible?

How could we expect to limit tax relief only to long distance commuting costs and ignore the fact that most workers incur costs connected in one way or another to their jobs? In addition to getting to and from work, different kinds of employees face special expenses related to their work. There was some adjustment for that in the standard personal deduction.

For example, many professionals have to buy computers if they often have to take work home. Maybe they need to be connected to the office to handle after hours urgencies. Of course, there could be many work related reasons for needing a computer at home. Other kinds of employees need other things. Most trades people for instance need to provide their own tools. These employees include carpenters, electricians and plumbers to name a few. In other cases employees may be required to provide their own uniforms or safety clothing.

It is safe to say that all the employees I mentioned, and many more I could have mentioned if time allowed, are incurring out of pocket expenses to perform their jobs.

This is precisely the problem with the bill at hand. How can we give forestry workers some special privilege under the tax system, a deduction for their long distance commuting costs, which we all agree is difficult, while ignoring the equally necessary and equally important expenses that other employees incur.

This leads me to my second concern with the bill. We must ask ourselves what would happen if we were to recognize the employment expenses of all the workers in all categories? The answer we would run into a major problem of affordability. Just to illustrate the enormity of the cost, we can look at the impact of reintroducing the $500 tax deduction for employment related expenses.

In closing, I congratulate the member, but we must have a fairer system for helping the workers in this industry.