House of Commons Hansard #50 of the 38th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was tax.


The House resumed from February 2 consideration of the motion that Bill C-33, a second act to implement certain provisions of the budget tabled in Parliament on March 23, 2004, be read the second time and referred to a committee.

Budget Implementation Act, 2004, No. 2Government Orders

10 a.m.


Brian Masse NDP Windsor West, ON

Mr. Speaker, it is my pleasure to rise today in the House to speak to Bill C-33, the budget implementation act. It is very important to look at a number of issues in the bill. There were a lot of issues that went to committee. I know that there is much interest in deciding what is going to happen with our economy. There were great presentations by hundreds of Canadians who submitted documents. It is important to note, though, that a couple of elements make this legislation very significant.

I am going to focus my remarks on a couple of elements, because I believe they deserve some attention and should be noted in this debate at second reading. One of them is an element that should be closed as it is something that is atrocious: the allowing, in business tax deductions, of fines and penalties to be tax deductible. That is going to be closed.

The second relates to the issue of infrastructure in our communities and our nation. I again will discuss, as I have many times, issues related to the crossing at Windsor--Detroit. I will certainly discuss some of the things that are happening now but also how this relates to our budgetary process. That is a moving target; there are a lot of things changing on a regular basis.

First I want to highlight some of the positive things that we New Democrats were very pleased to see in the budget bill. One in particular is the introduction of the closing of that loophole I mentioned, that gap.

It is hard for Canadians to believe this. A corporation could go to court and be convicted of a criminal offence related to polluting the environment, conspiracy related to market practices and a number of serious elements that are predatory not only to Canadian taxpayers but also to other businesses. The government would then go through the process, there would be a review, charges would be laid and a judgment cast. At the end of the day, behind closed doors, an accountant could then deduct those fines and penalties as a tax break.

It is amazing that the process to get here was so difficult. As New Democrats, we want to make this chamber work and we have been doing that in a number of different initiatives. This was very difficult to push through at the end, but I think it is important to talk about the first part of that process.

I do want to recognize the member for Winnipeg Centre, who pioneered this fight. This fight goes back to a time before I was elected to the House of Commons. It goes back to the member's comments in the House of Commons. I will read that question to the House. It will be shocking for Canadians to learn that there was no response until 2005, when we pressured the government to close the loophole:

Mr. Speaker, I cannot deduct my traffic tickets from my income tax yet a recent court ruling says that businesses can deduct fines, penalties and levies as a legitimate business expense. I find this outrageous. Will the Minister of National Revenue agree that it undermines the deterrent value of a fine if a company can write it off as a tax deduction?

That was said by the member for Winnipeg Centre in May 2002.

What we are talking about is the decision that it is a legitimate business expense to poison our water, a legitimate business expense to practice predatory behaviour that costs other Canadians jobs because their company might play by the rules, whether it is safety or product information that is valid as opposed to unfair advertising or practising predatory behaviour on consumers. These fines were a legitimate business expense and could be deducted.

We have not done all the research on this, but we know it has cost us tens of millions of dollars each year. One of the fines that was levied was for $50 million. It was a joint issue related to drug companies that were fined for conspiracy related to bulk vitamins. There were several companies involved. We estimate that from that $50 million they could have had $10 million of taxpayers' money coming back to them. It is a crime that this type of practice was allowed.

When the member for Winnipeg Centre brought this to the government's attention, nothing was done. In fact, he followed that up with this question back in 2002, about six months later:

Mr. Speaker, six months ago I asked the revenue minister to plug the tax loophole that allows businesses to deduct fines and penalties from their income tax as a business expense. Since when is breaking the law supposed to be tax deductible?

It is unbelievable that we still had no movement even then.

We continue to fight as New Democrats on this issue. We continue to raise the consciences of Canadians and make them aware that for this coming tax year they will not be able to deduct fines and penalties. At the same time, Canadians were having to pay more because the government was shovelling the money back to the people who had gone to court, lost a case and had been fined, penalized or had a levy placed upon them. We would shovel money back behind the scenes to them because they had good accountants and because there was no progress made on this file.

What happened here in the House of Commons is unbelievable. The government at the industry committee then introduced Bill C-19 which looked at increasing administrative monetary penalties but still did not fix the loophole.

I was pleased to introduce a motion at the industry committee to suspend deliberations and discussions on Bill C-19 until this gap was plugged. What was amazing was that we found out the legislation to fix this gap, which was again one of the promises in the Speech from the Throne that never reached fruition, was ready but the government refused to introduce the elements to actually cast the last completion to fix this loophole. It was sitting on a shelf gathering dust.

The motion passed, and I must give credit to the Conservative Party of Canada which supported the motion. Although the Conservatives did not necessarily agree with my position that tax deductions on fines, penalties and levies should not be tax deductible, they said that they were quite clear on that but that they were not fully convinced that was their thing. However they said that a promise was made by the government in the Speech from the Throne, that New Democrats had been raising the issue and that the promise should be honoured. The Conservatives were straight up and I give them credit for that. They have accountability. The Bloc Québécois supported it as well.

Do members know what happened? The Liberals on the committee stormed out of the meeting after we got the suspension. I will give credit to the Liberal chair of the committee who did a good job of handling the situation, handling the committee and making sure that we were working together in a non-partisan way. He was also very much interested in a dialoguing with me to get this moving, which was very important.

A week and a half later the government did introduce Bill C-33 and made sure the amendment was in the bill. We then came back to the House of Commons after the break and we are now in the final stages of the bill.

It is because of that that I kept my word as well and in committee this week we agreed to put Bill C-19 back on the table, which is how Parliament should work.

I do not understand why we had to drag the government kicking and screaming to end something that was so egregious for Canadian citizens. Once again I have to say that the member for Winnipeg Centre should be commended for pioneering this fight. It not only has an implication on individuals and the money they will save as taxpayers that will not be shovelled back to people that break the law, it will also set the record straight that if people are going to pollute, if they are going to use predatory practices that affect consumers and other Canadians and they are caught, they will be fined and not be able to get that money back through the back door. This sets an example.

We have seen a couple of vivid examples in the last few days where a special investigation unit of the RCMP has been out on Bay Street with a big van outside offices and securing records because of the potential problems on Bay Street. This is another issue that was behind the scenes. We did not have the van, but unethical practices were happening through the shuffling of paper that at least as Canadians we can say will be completed and finished. We are very proud to be part of that.

The budget is a very important document in terms of the way in which the process is developed and the promises that are made and things that are laid out later.

Another issue that is evolving right now is the importance of recognizing the decisions being made by this nation regarding infrastructure and investment that has already cost us a lot of money.

Forty-two percent of the nation's trade goes through the Windsor-Detroit border. At the present time there is a rail tunnel with a small load capacity which is not being used much right now because it has only a single stack and it needs a double stack to be more efficient. There is a tunnel for cars and trucks but it is predominantly trucks that use it. There is a ferry crossing and there is the Ambassador Bridge. These elements span about two kilometre's over the Detroit River. Forty-two percent of our nation's trade goes along those two kilometres.

The city and county councils of the day have just released a constructive plan from the Schwartz report. The community has struggled a great deal to find a solution to the gridlock and to ensure the proper infrastructure is in place. Many different community groups have been seeking solutions to this gridlock because it not only has an impact on the air quality, it also has an impact on the community in terms of travelling from the east side of the city to the west side. It is also having an impact on international trade and is prohibiting business development in the community.

The city has come up with a consensus on the problem but it is a problem that requires infrastructure dollars. I will remind the House that the Prime Minister promised that he would look for a solution but that he would not impose anything on the City of Windsor. What the Prime Minister needs to understand is that words are not good enough. Any action that has to be taken must also come with the resources.

After many months of study the Schwartz report is finally finished and now we have the bureaucrats suggesting that it might or might not work. That is not good enough. We were told that appropriate resources would be provided for this.

Let me put the importance of 42% of the nation's trade going through this corridor into context. There has been no infrastructure investment of any significant magnitude in this corridor since NAFTA. Despite all the growth, despite the years and years of warnings from the councils to the former minister of finance, now the Prime Minister, and finance ministers after him, and despite all the county and city resolutions, no action has yet been taken.

As a result, a report was released this year from the Michigan department of transportation that calculates that this year alone the Canadian economy lost $18 billion from delays at the border; double the surplus. We know that the auto plants and parts manufacturers are coming up with other options because of this infrastructure deficiency.

It is interesting to note that the city came back with a consensus report. What had happened was that the federal Liberal government, along with the provincial Conservative government at that time, behind closed doors, attempted to impose something on the community called a nine point plan. They tried to shovel taxpayer dollars to private companies to promote their advancement of solutions that would not work and had no modelling or grounding as solutions.

Our community fought that plan. We exposed its weakness not only in the planning but in the process. The governments had breached the trust of every resident of the city. There was no solution. They were just trying to seek taxpayer dollars. The city was asked to come up with a solution so it hired the brightest traffic guru in North America, Sam Schwartz, a former New York City traffic commissioner, to do a study and come up with a report, which he did. They have consensus for the first time. The warden and the mayor deserve credit for that.

It is not the perfect solution that I would have liked, nor is it everything I was seeking, but it is something. It actually has traffic modelling and it has an actual plan that is multi-model, that will carry the day and that will rebuild confidence.

However the plan will cost money. It has been estimated that it will cost about $1 billion to carry out that plan. Nothing is wrong with that because $18 billion was just lost last year and it will be lost again this year. I can tell members that if the resources are not there, the communities of Windsor and Essex county will fight something being imposed on them. If somebody else wants to impose something that does not support what the community has asked and advocated for, the timelines better be built in for what we are going to do to protect our community to make sure that it is a healthy and vibrant city, not only for raising families but also for economic development. That is important to note.

Once again the word of the Prime Minister and others was that they would be there. In fact just recently in the House of Commons the Parliamentary Secretary to the Minister of Finance said they would be there when I asked a question. Well they had better be there. We see stories though that give me concern. The Windsor Star reads:

Border money up in air--Federal and provincial politicians will decide within "a few weeks" how much funding will be provided and when construction will begin on the next phase of improvements to fix Windsor's border traffic problems.

That is fine, but I have not heard the political leadership say that the money will be there.

What is interesting about all of this is that on the U.S. side the Americans do not seem to have that problem. I will quote Paul Cellucci:

Cellucci urges border decision: Ambassador says U.S. may split costs:"U.S. Ambassador Paul Cellucci says Washington wants quick approval of a new border crossing between Windsor and Detroit and suggested the U.S. is prepared to split the cost.

He noted Canada and the U.S. have worked out a 50/50 cost-sharing formula to pay for a new bridge being built between New Brunswick and Maine, saying this could be the model for the new crossing under study in Windsor and Detroit to relieve the logjams that plague the countries' busiest border crossing.”

What is amazing and what is not talked about often enough is the fact that this corridor, with 42% of our nation's trade, the busiest and most important corridor that we have, has no coordinating body despite four crossings to get the trucks, people, cars and goods and services across the two kilometres. It is not done like that in Fort Erie. It is not done like that in Niagara Falls. It is not done like that in Sarnia. They have a border authority or a public commission. They at least have something that helps coordinate the long term development of the region, the traffic management, the flow and the infrastructure.

With all the changing legislation coming from the United States, it is more important today because just as important as infrastructure is legislation, programming, staff and technology to move the border traffic through at a good rate.

Why is that not being done in Windsor? Why is it that we are going to let 42% of our nation's trade hang in the balance of chaos and no coordination? Part of the reason is that unlike everywhere else, except for one other place, 24 crossings, which are tunnels and bridges, are held by the public sector. Two crossings are held by the private sector: the Ambassador Bridge and Fort Frances. The other ones are usually owned by state, provincial or sometimes municipal governments. In Windsor our tunnel pays a revenue and a dividend back to the people to relieve taxes as opposed to filling somebody else's pocket.

However in Windsor there has been no comment by the government to date as to whether it will fund the next crossing, which is incredible because we are going to let 42% of our nation's trade become a business for someone to usurp the profits of the auto industry, the agricultural industry and people crossing on a daily basis, as opposed to saying that it is a social and economic conduit between our two nations that should not be a profiteering model, not off the backs of industry and not off the backs of people. It is an important connection link between our two countries.

Those moneys for the border could go toward a solution for the future so that we will not have to dig back and try to find money. This should be done properly. I do not understand why we have been left in this situation. I cannot understand why we would let 42% of our nation's trade be thrown up in the air for the interests of a few as opposed to the benefits of many.

Budget Implementation Act, 2004, No. 2Government Orders

10:20 a.m.

Etobicoke North Ontario


Roy Cullen LiberalParliamentary Secretary to the Minister of Public Safety and Emergency Preparedness

Mr. Speaker, I know the member for Windsor West works very diligently and passionately with respect to border issues. His riding is situated close to the most important border crossing in Canada in terms of our commercial trade between Windsor and Detroit.

He throws out the figure of $18 billion in lost revenues, a figure which I think comes from the Ontario Chamber of Commerce. Frankly, it is good that the number is out there. It certainly helps us focus our minds on the importance of the border. I have also debated the figure with the Ontario Chamber of Commerce, and it depends so much on scenarios, models and formulas or what is built into that model.

I think the member also understands that the Deputy Prime Minister met recently in Detroit and Windsor with U.S. homeland security secretary Tom Ridge at which time the U.S. government and ourselves committed to increasing the flow of traffic and decreasing the transit times by 25% next year, and we will do that. Bridge lanes will be added on the Canadian and U.S. sides. We have committed to putting in 30 more customs officers at the border to staff the new lanes. The U.S. has made the same commitment on its side.

We know we have work to do. We know there are challenges. We know we have to keep the border secure but open for the huge amounts of trade between Canada and the United States.

Has the member really studied the figure of $18 billion earnestly and challenged that number? It is in the public and it deserves some scrutiny.

Budget Implementation Act, 2004, No. 2Government Orders

10:25 a.m.


Brian Masse NDP Windsor West, ON

Mr. Speaker, I appreciate the parliamentary secretary's work on this file.

I stand to be corrected, but I am almost 100% sure that the number comes from a recently completed Michigan department of transportation study. Another study was done by the Ontario Chamber of Commerce. If memory serves me correctly, it projected a $6 billion to $8 billion loss because of the trade impediments along the corridor. It almost does not matter whether it is between those two figures or off by a little, it is still more annually than it would be to fix the problem with the consensus presented by the city and the county. Every year there will be a greater loss than the cost to improve the corridor.

It is important to note as well that infrastructure improvements are not a net loss for the country. Infrastructure improvements pay a dividend, not only in terms of shortening the time of business travel and economic prosperity and savings in health costs related to air pollution, but the improvements create jobs and employment. People and companies pay taxes, all those things.

The solutions we are seeking on the border are ones that pay dividends for the rest of the country. It is not a net loss.

Budget Implementation Act, 2004, No. 2Government Orders

10:25 a.m.


Guy Côté Bloc Portneuf, QC

Mr. Speaker, I can really sympathize with the complaints of our colleague from Windsor West. Unfortunately, we in Quebec are used to a federal government that often ignores consensus. It also tends to impose programs and agreements after holding negotiations behind closed doors. An example of this currently in the news is the parental leave program.

We are also used to a government that does not know how to adequately supervise its borders. We need only mention the recent example of the government's inability to ensure adequate protection of Quebec's border by the RCMP.

I want to ask the member for Windsor West to briefly review the reasons given by the government, at present, for not proceeding with necessary projects in his region.

Budget Implementation Act, 2004, No. 2Government Orders

10:25 a.m.


Brian Masse NDP Windsor West, ON

Mr. Speaker, the question is very pertinent to what is happening now. There has been stone silence since the proposal has been put forth in terms of making an outright commitment that the government will fund these projects. I do not know the reason for that. I have a problem with it because it goes back to the history of the promise that something would not be imposed upon our community and if a consensus was reached, we would be supported. We deserve the fulfilment of that promise.

It is important to recognize that in our corridor no one wants to move the traffic more than us. I do not want it polluting children playing in schoolyards a few hundred feet away. I do not want it blocking businesses. We do not want it stopping people from going back and forth to meet their friends and family or stopping those who work in Detroit and pay taxes here in Canada. We want a solution that works for all of us and for Canada. We believe we deserve the right investment. If we are healthy in Windsor and if we have a solution that works for us, it will work for the nation.

Ottawa has to understand that. It will work for the nation if it works for Windsor.

Budget Implementation Act, 2004, No. 2Government Orders

10:30 a.m.


David Kilgour Liberal Edmonton—Beaumont, AB

Mr. Speaker, the hon. member for Windsor West and I were in Washington at a conference. Many people talked on the issue on which he speaks so passionately.

What can the member tell us today about the line-ups and that sort of thing that cause grief for Canadians?

Budget Implementation Act, 2004, No. 2Government Orders

10:30 a.m.


Brian Masse NDP Windsor West, ON

Mr. Speaker, I appreciate the efforts of the member who participated in the all party group that went to Washington. The interest in the file is very important because it affects our country.

I want to give some credit to the government. I do not want to be one-sided on this. We have cried for years and years for increased staffing. We finally got it, and that has helped the situation. We have a timeframe, a window, that will help us. We need more, and we wish the government had listened sooner. However, I give it credit for pushing those issues.

I have to question why we cannot put in the resources and those things that we can control and that have no effect on the people, the communities and the areas around them. Why would we not maximize that potential where we have elements of control? There has been an improvement with the additional staffing, but we have days when we still have a back-up. If there is one problem, it throws things out of whack.

One thing I have discovered we can do is stop the predatory practice on the ferry service which has to pay for customs whereas the tunnel and the bridge get a free ride for customs, which is a historical practice. The ferry service, which is supposed to move hazard material trucks, pays customs. The government is trying to run them out of business in my opinion. There is a solution to that, and the community supports it.

Why does the government not fix it? It can do it with the stroke of a pen.

Budget Implementation Act, 2004, No. 2Government Orders

10:30 a.m.

Etobicoke North Ontario


Roy Cullen LiberalParliamentary Secretary to the Minister of Public Safety and Emergency Preparedness

Mr. Speaker, I am very happy to participate in the debate about the 2005 budget which the minister has announced will come up on February 23. This is a good opportunity for all members of Parliament to comment on what they would like to see in the budget.

The first thing I would like to comment on is the need for us to maintain our strong fiscal performance. One of the things our government has done is had a very sound economic and fiscal--

Budget Implementation Act, 2004, No. 2Government Orders

10:30 a.m.


Ken Epp Conservative Edmonton—Sherwood Park, AB

Mr. Speaker, I rise on a point of order. It is a question of relevance. I think the parliamentary secretary has pulled the wrong speech out of his folder. We are not talking about the budget that is to come. We are trying to implement the budget that was passed last year.

Budget Implementation Act, 2004, No. 2Government Orders

10:30 a.m.

The Deputy Speaker

I thank the member for Edmonton--Sherwood Park, but we have the budgets that were, will be and will be to come, and perhaps they are related. The parliamentary secretary will probably pull that all together.

Budget Implementation Act, 2004, No. 2Government Orders

10:30 a.m.


Roy Cullen Liberal Etobicoke North, ON

Mr. Speaker, we know that developing and implementing a budget is a continuous process. As I said, we need to build on our strong fiscal performance. In 2003-04 we will record our seventh straight surplus. I am sure we will have another surplus again in 2004-05.

While the other parties opposite might argue that this is a bad news story because we have not predicted them precisely every year, I look at it as a very positive story. When we have surpluses we are able to pay down the debt. We cannot forget about the fact that we still have a federal debt exceeding $400 billion. Under the mandate of this government, we have paid down about $60 billion against the debt, but we still have more work to do. Because of that paydown in the debt, Canadian taxpayers are saving over $3 billion a year in money that would be otherwise used to service that debt. That is a $3 billion annual annuity that the federal government can put toward other priorities of Canadians.

While other members are concerned about the inability, in their judgment, in the government's ability to forecast these surpluses, the Minister of Finance has pointed out quite astutely that with a 1% deviation on the expenditure side coupled with a 1% deviation on the revenue side, suddenly the surplus is out by $3 billion or $4 billion. In the world we live in today, of increasing uncertainty and volatility, it is easy to understand how surpluses cannot be precisely forecast each year.

However, notwithstanding that, it is still a good news story. It has to be a good news story that we are coming up with surpluses, not deficits. Where are we that we have to attack the fact that we are having surpluses and that we are paying down our national debt?

Our economy has grown consistently at levels around 3%. In fact, we have performed very well. We have a very low interest rate environment that is good for businesses and Canadians. People in rental properties are getting out and buying houses or duplexes. They can take on a mortgage because it is affordable.

We have had the largest tax cut in Canadian history in the year 2000. When we had this debate the other day, the members opposite said that it was not really a $100 billion tax cut. It was. The reason they argue that is they are absolutely incredulous. They did not think a Liberal government would address taxes, but we did. Have we more work to do? Of course we do. Will we do more? Yes, I am sure we will. The fact is it was a $100 billion tax cut, the largest tax cut in Canadian history.

The members opposite argued that we put the indexing back into the tax system, which had been taken out to deal with the budgetary deficit. We re-indexed the tax system. In other words, a Canadian typically would have been paying more tax had we not done that. This is a tax measure that results in lower taxes for Canadians.

The parties opposite also, especially the Conservative Party, argued that the measure we took with respect to the Canada child tax benefit was not a tax cut. It was not a tax cut for wealthy Canadians. It was not a tax cut for big business. For the average family, a poor and middle income family with children, this has been a huge benefit. That is a tax cut because many of these people, while they would have only been paying modest taxes, were paying taxes. These were tax cuts. This is the largest tax cut in Canadian history.

I believe we need to do more in terms of the disposable incomes of Canadians. The members opposite argue that because Canada pension plan premiums have gone up that it is a tax increase. That is a fallacious argument, and they know it.

When a person invests in a pension, it has nothing to do with taxes. It has to do with a contributory pension plan system where the employee puts in money and the government puts in money, and that helps to secure the retirement plan of all Canadians.

The fact that Canada pension plan premiums went up has nothing to do with taxes. I would agree that it has something to do with the take-home pay of Canadians. The disposable income of Canadians is an issue we have to be mindful of all the time because we do want money in the hands of Canadians. It is good for the economy. It is good for economic growth.

We need to be mindful of the productivity gap between ourselves and the U.S. We need to ensure we are investing in innovation. We need to ensure that we are mindful of and focused on productivity issues vis-à-vis our major trading partner, the United States.

However, having said all that, the performance of our economy is the envy of the world. People look at our economy and say that Canada is a fiscal miracle.

Just today, for example, the numbers came out on unemployment. Of course we do not like to see any unemployment. Any unemployment is bad. However, it is down to 7%, which is the lowest it has been in four years.

We have to stay the course. We have to stay out of deficit, clearly. We have to keep churning out surpluses. We need to keep paying down the debt. We need to be investing in innovation. We need to contain expenditure.

The parties opposite talk about how expenditures have grown out of line, in terms of the size of our economy. I would agree that we need to be mindful of the levels of expenditure, but the reality is that some 80% of the additional resources that the federal government has been spending have been going to the priorities of Canadians, investing in such things as health care, education, social programs and an innovative economy. We do need to ensure that our expenditures stay in line with the growth in our economy. I would agree with the finance committee's recent report. It made that sort of recommendation as well.

One of the things that our government is very proud of is that we have delivered our commitments. As a government we have made a number of commitments over the last while. The budget will have to incorporate those commitments into our fiscal plan.

The one that is very important in the minds of all Canadians is health care. With the health care accord in 2003 and the additional moneys that were put into the health care system, it comes to an investment by this government of about $37 billion.

We all know that money is not the only solution for a health care system. It is one of those areas where we could keep pouring money. Notwithstanding the importance of having a sound health care system, we must have it managed better. We need to have it managed as a whole system.

When I travel around, I see so many examples where we are not managing our health care system as a holistic type of system. There are elderly people sitting in acute care beds because there is no place for them to go. They do not need the special care and attention of an acute care hospital, which by the way costs us as taxpayers maybe $1,000 a day because of all the services, equipment and highly qualified staff. We cannot put these people in lower cost institutions because the capacity is not there.

This is something the provinces and territories have wrestled with for years, but we still do not have it right. We will never have it perfectly right. We know that. However, we need to do a better job of ensuring that we have people in our health care system at the right level because it is better, in terms of patient care

If we have elderly persons sitting in intensive care in a hospital and they do not need that level of care, they would rather be in an outpatient program, or they would rather be at home. It is better for patient care and certainly better in terms of health care economics. It is better for the taxpayers of Canada.

While we need more money for the health care system, our government has consistently poured money into health care, as I said, $37 billion most recently. We need to and have agreed with the provinces and territories that there is going to be greater accountability, greater transparency, more reporting on benchmarking in terms of performance and standards. As a result Canadians in Saskatchewan can look at their province and compare it with what is going on in Yukon or in New Brunswick and can ask whether they are getting good value from their tax dollars.

We have made some major commitments with respect to cities and communities. We started last year by exempting municipalities from the GST. What does that mean? I will tell the House what it means in a city that I represent, the city of Toronto. By exempting the city of Toronto from the GST, which happened last year, it saves the city of Toronto $50 million a year. Some will say that is peanuts. I am sorry, but $50 million a year where I come from is a lot of money.

That is just the start because our Prime Minister and government have committed to give a portion of the excise tax directly to municipalities. I am happy to see that because in my province of Ontario we have seen, not so much under the regime in place now in Queen's Park but under the Harris and Eves government, a lot of programs devolve to the municipalities.

We saw that municipalities were going to have all these new responsibilities and new programs, but they forgot to transfer the resources. What we are going to do is transfer those resources directly to municipalities through a portion of the gas tax. This is being negotiated as we speak.

I would like to see that negotiation reflect the fact that large cities like Toronto, Vancouver, Montreal, Calgary, Edmonton and many others have unique challenges. They have unique challenges with respect to public transit, air quality, and a whole host of issues with respect to social programs, such as the homeless.

We need to deal with rural communities as well, but they have different problems. When we say one size fits all, we may be politically correct but we are missing the boat. We need to understand and target our programs to the unique needs that are there.

I am a big fan of dedicating this tax and sending it directly to cities because in the city where I live we have some challenges. We have some problems. I have seen air quality diminish over the last 10 years. We see a lot of homeless people. We see urban sprawl.

I was very glad to see the Ontario government finally taking some action with respect to urban sprawl in Toronto because there are communities expanding and growing, which does not lend itself very much to public transit. We need to get higher population densities within the city centre and that will create more opportunities for public transit. That will make our air better and life easier in cities like Toronto.

We have made some commitments to the learning and child care programs. I know the minister is working on that with the provinces and territories. I know that a lot of women in my riding have come to see me to say they need child care in the province of Ontario. We could not get any child care programs going because the Harris and Eves government said it was not participating. Now we are saying to heck with that, we are just going to do it. With the government in Queen's Park now we think we are going to have a more cooperative and sharing environment to do that.

We have recently concluded some new arrangements with respect to equalization dealing with the offshore oil and gas revenues of provinces like Newfoundland and Nova Scotia. That has to be built into the budget.

I would like to see something in the budget with respect to Kyoto. We signed the Kyoto accord. I know there was a lot of debate by members on both sides of the House. Some argued that greenhouse gases and climate change are not a problem. I do not believe that. I think that climate change and greenhouse gases are a problem and that we have to invest.

The difficulty I had when we signed the Kyoto accord was how we were going to meet this objective. I do not like to sign anything or commit to anything unless I can deliver it. We have some challenges on this very front. I would like to see in this upcoming budget some economic instruments that will encourage--

Budget Implementation Act, 2004, No. 2Government Orders

10:45 a.m.

The Deputy Speaker

On a point of order, the hon. member for Peace River.

Budget Implementation Act, 2004, No. 2Government Orders

10:45 a.m.


Charlie Penson Conservative Peace River, AB

Mr. Speaker, I would like to remind the member that this is the budget implementation bill that we are talking about for last year's budget. He seems to be talking about the upcoming budget. I guess we would all like that opportunity, but I want to remind him that he is speaking about last year's budget.

Budget Implementation Act, 2004, No. 2Government Orders

10:45 a.m.

The Deputy Speaker

I am sure the hon. parliamentary secretary is going to pull it together and make it all relevant.

Budget Implementation Act, 2004, No. 2Government Orders

10:45 a.m.


Roy Cullen Liberal Etobicoke North, ON

Mr. Speaker, I thank the member for reminding me.

In last year's budget we had some investments in Kyoto. I would like us to build on that experience. We need some more beyond the measures in last year's budget. We need some more investments in economic instruments and incentives for industry to adapt and change, some market signals.

I know there has been this concept that has been floating out there about a fund that would buy up credits. Those areas where we have greenhouse gas reductions would get a refund from this fund. That allows the market to some extent to focus on what are going to be the major efficiencies that we can accomplish. I would like to see some emphasis on alternative fuels and renewable energy. We have various instruments in our tax policy, in the budget before us today and in future budgets, that will deal with that.

I would like to see the budget deal with municipal solid waste. We often forget that the landfills that we see all across this country produce methane. Methane rises into the atmosphere. In some cases we collect it underneath, but in most cases the methane just rises into the atmosphere.

Methane is about 20 times more harmful with respect to greenhouse gases than CO


. We still allow this methane to drift into the atmosphere. I know that there are technologies available to convert methane. I have worked with the city of Toronto and our ministers here to see if we can encourage the kinds of technologies that will convert this municipal solid waste into methane and turn it into electricity, and into products that could be used for example by the farming industry.

We need to invest further, beyond the measures in this budget, in public transit. In a city such as Toronto we see the air quality diminishing. I would like to see measures that will encourage energy efficiency and encourage investments in alternative energy, such as wind power, solar, the use of hydrogen, et cetera.

Having said that, we must remember that we still have some work to do on taxes. In last year's budget, the budget before us today and in future budgets, because of various commitments that our government has rightly made, I am not sure that there will be a lot of flexibility for the finance minister to look very aggressively at tax cuts.

In the forthcoming budget I would like to see a discussion around where we are going with taxes, particularly personal income taxes which are still somewhat high in Canada. We still need to be mindful of work that we have to do on taxes.

However, we learned in Ontario under the Harris and Eves governments that tax cuts are not the panacea. In Ontario, the government went well beyond what was required, necessary or prudent. We saw a gutting of programs. Canadians and Ontarians said the government had gone too far.

We must be careful about how we go with tax cuts because we erode the revenue base of the government and then we cannot deliver on some of our national priorities, some of the federal government's programs that most Canadians like and need. We must look at that.

We need to invest in our national security. I will declare a conflict of interest in the sense that I am the Parliamentary Secretary to the Minister of Public Safety and Emergency Preparedness. We need to deal with law enforcement. We need to deal aggressively with organized crime. We need to invest, as was discussed by the member from Windsor, in our borders. We need to increase our defence spending.

I suggest that this will be a difficult budget. I am confident that our Minister of Finance will come out with a budget that will reflect the priorities of Canadians.

Budget Implementation Act, 2004, No. 2Government Orders

10:50 a.m.


Larry Miller Conservative Grey—Bruce—Owen Sound, ON

Mr. Speaker, usually when somebody swears in the House you correct them. I heard the hon. member across the way use the words “rural Canada”. Normally, coming from that side of the House they are swear words. Rural Canada has been ignored by the government for so long.

I have heard some members today talk about high taxes. High taxes affect everyone in this country, but they affect rural Canada more than any other place because of the different obstacles. Even the minister pointed that out.

Judging by the lack of spending in rural Canada over the years, it has been totally ignored. One thing that really hurt rural Canada and me specifically was the announcement by the government that when it came to infrastructure, the definition of small communities was 250,000. That is totally ridiculous. It is a blatant mockery. At first I thought it was just a sick joke. It is the same as taking a rural Canadian out to his barnyard, knocking him down in the manure pile and then stepping on his shoulders to make sure he gets good and dirty.

Rural Canada is short of funding for roads and bridges. On health care, there are doctor shortages. We hand over our cheques. For a long time the government reduced the funding that went to health care which hurt rural Canada a lot. After a lot of pressure from this side of the House the government finally agreed to put some of that money back in. That is good, but it hands the cheque over to the province without any direction.

I want to know what the government will do to address that rural Canada which the member across the way mentioned. Frankly, rural Canada is sick and tired of being used, bruised and abused.

Budget Implementation Act, 2004, No. 2Government Orders

10:55 a.m.


Roy Cullen Liberal Etobicoke North, ON

Mr. Speaker, I certainly do not use the term “rural Canada” in any derogatory form whatsoever. In fact, my father was born and raised on a farm outside Montreal. As a youth I would go to the farm in the summers and bring in the hay and milk the cows, et cetera. I understand to some extent the challenges of farmers in Canada. We have a job to do to make sure that we preserve the life in rural Canada, the small farm.

A couple of years ago I worked with Ducks Unlimited on a proposal that would allow farmers, if they wished, to convert marginal farmland into ecological areas for wildlife and riparian areas. In fact, that thinking has advanced. I understand the problem of people living on farms and having to have other jobs just to make ends meet. There are areas on farms where there is marginal farmland that could be converted to other uses and provide some much needed capital to farmers.

With respect to the member's comment about health care, I thought I had been very clear that in the health accord we have asked, and the provinces and territories have agreed, that there be greater accountability, more transparency, more benchmarking and performance standards so that comparisons can be made between provinces.

Rural Canada also needs investments in infrastructure. The challenge there is the huge geography and the distances that are involved.

We have the challenges with world subsidies, the U.S. and European subsidies. I am hopeful that we will make some progress on that issue as well. We have a lot to do to support our farming communities across Canada. Our government is committed to doing that.

Canadian ForcesStatements By Members

10:55 a.m.


Keith Martin Liberal Esquimalt—Juan de Fuca, BC

Mr. Speaker, on behalf of the Government of Canada and all members in the House, I would like to congratulate General Rick Hillier on assuming the post of chief of the defence staff of the Canadian Forces.

General Hillier's extensive experience and proven no-nonsense leadership will be instrumental in transforming our Canadian Forces to meet our security challenges in the post-September 11 environment.

He has served on many UN and NATO missions. Most recently he led 6,000 troops from 35 nations as the commander of NATO's international security assistance force in Afghanistan.

I would also like to congratulate outgoing chief of the defence staff General Ray Henault, who was elected to the post of NATO's most senior military officer as chairman of its military committee providing excellent advice and strong leadership.

On behalf of all members, I thank both generals for their profound service to our country. I look forward to working with General Hillier to strengthen the capabilities of our men and women who work in our Canadian Forces.

9/11 MemorialStatements By Members

10:55 a.m.


Daryl Kramp Conservative Prince Edward—Hastings, ON

Mr. Speaker, I rise today to acknowledge the efforts of Mr. Paul Shier, a constituent of mine from the village of Tweed.

Like so many people around the world, Paul was deeply disturbed over the events of 9/11. While many expressed shock, anger, regret and sympathy, Paul was moved to create a lasting Canadian memorial.

With over 1,000 man hours of labour and talent, Paul created a massive 200 pound soapstone carving that truly captures the heroic efforts of the emergency personnel and the suffering of so many.

On March 6 and 7 of this year, Mr. Shier will travel to New York City to donate his tribute to the victims of 9/11. The statue will be displayed in the atrium of Bellevue Hospital, a few blocks away from ground zero.

Please join me today in congratulating the efforts and the commitment of Mr. Shier, and the thousands of other Canadians who have clearly demonstrated our solidarity with our American neighbours by standing with them in memory of that fateful day.

LiteracyStatements By Members

11 a.m.


Judi Longfield Liberal Whitby—Oshawa, ON

Mr. Speaker, I am pleased to rise today in recognition of family literacy day which was marked across the country on January 27.

Family literacy refers to the many ways families develop and use literary skills such as reading, writing, computation, communication, and problem solving skills to accomplish day to day tasks and activities, including sharing a bedtime story.

Literacy and the other essential skills are linked to quality of life, employment, health and self-esteem, and are critical to Canada's social and economic well-being in the 21st century.

Literacy begins with the family. When parents read to their children and provide a literacy rich environment, they show them that the written word is key to learning and that learning can be fun.

Children whose parents spend time reading to them achieve higher success in their education and their careers.

I encourage my colleagues in the House and all Canadians across the country to read to their children. I congratulate those who are dedicated to advancing family literacy skills in Canada.

Fleury FarmStatements By Members

11 a.m.


André Bellavance Bloc Richmond—Arthabaska, QC

.Mr. Speaker, the owners of Fleury farm in Victoriaville, Jean-Albert Fleury, Ginette Boulanger and Jean-Claude Fleury, have just been awarded the title of Master Breeder, awarded annually to approximately twenty producers in Canada.

This distinction was given to this family farm in my riding for its entire herd and its management. This farm has 230 purebred superior Holstein dairy cows and heifers, and a total of 500 acres of forage and grain crops.

.The owners of Fleury farm were recognized at Holstein Quebec's annual meeting currently underway in Valleyfield and will be officially feted at the Holstein National Convention in Saskatoon in April. Holstein Canada will showcase the 21 nominees, including 6 from Quebec, in a brochure to be distributed throughout Quebec and Canada.

Congratulations to Fleury farm, which, by winning this honour, promotes agriculture in the Richmond—Arthabaska riding, known for its quality dairy cows.

Atlantic Canadian BusinessesStatements By Members

11 a.m.


Michael John Savage Liberal Dartmouth—Cole Harbour, NS

Mr. Speaker, in the month of January I had the opportunity to visit a number of businesses in my constituency.

These businesses have several things in common. They are successful and employ many Atlantic Canadians. They focus on innovation, technology and the developing markets, not only in Atlantic Canada but around the world. Another thing they have in common is that ACOA has been involved in their success, not through grants but through loans, providing support and accessing capital investment, innovation, marketing and training.

These companies are forming the backbone of the Atlantic Canadian economy and providing jobs that are innovative, well paying and sustainable. Companies like Ocean Nutrition are finding great success based in Dartmouth with a plant in rural Nova Scotia and potentially plants around the world.

The Atlantic innovation fund has played a very strong role in ensuring the success of Atlantic Canada and it must continue. ACOA is a success story. I congratulate the leadership of ACOA, our current minister and those who have gone before him, for seeing the long term potential of Atlantic Canada and helping us to reach it.

Government OperationsStatements By Members

11 a.m.


Guy Lauzon Conservative Stormont—Dundas—South Glengarry, ON

Mr. Speaker, Stormont--Dundas--South Glengarry is populated with honest hardworking taxpayers who have been ignored by the Liberal government for much too long.

Farmers have been waiting for 12 years to get an ethanol plant built in the riding and because of Liberal government dithering, the shovel is still not in the ground. Two major employers in Cornwall have recently announced layoffs totalling over 560 employees. One is relocating to the United States after trying to get help from the government for over two years.

My riding is within a stone's throw of Ottawa and we have a well educated, bilingual workforce and inexpensive office facilities. On two separate occasions I have urged the Minister of Public Works to show respect and compassion for my constituents by decentralizing some of the massive government operations located here in Ottawa to my riding.

Because my constituents have been such loyal Canadian citizens, I call on the minister yet again to immediately decentralize quality government jobs to my riding.

MunicipalitiesStatements By Members

11 a.m.


Don Boudria Liberal Glengarry—Prescott—Russell, ON

Mr. Speaker, I was pleased to learn that the Government of Canada has outlined to its provincial and territorial counterparts the details of how it will negotiate the new deal for cities and communities discussed in today's budget bill.

Starting this year municipalities in Ontario will share funding of approximately $1.8 billion spread over the next five years. This will be quite good for rural Ontario, particularly eastern Ontario.

I encourage the Government of Canada to quickly negotiate the particulars of this agreement with the province of Ontario so that municipalities in my riding and elsewhere will have access to much needed infrastructure programs. I know the minister is working very hard at this. I anxiously await this funding for my constituents.