Debates of March 7th, 2005

The Budget

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Mr. Speaker, the parliamentary secretary speaks some double-talk. The CAIS deposit program has cost farmers a lot of grief. I have received a lot of calls in my office with respect to that deposit. It is something the government said that it would undertake to discuss. The parliamentary secretary, along with other ministers, including the finance minister and the Prime Minister, voted against our motion that the deposit be dropped.

Now they say they are talking about it. Talk is too little. The farmers require action. Would the parliamentary secretary undertake categorically to say that the CAIS deposit requirement will be dropped and that the government will see to it, regardless of what the provinces may or may not do. It is something he can do.

He mentioned that $700 million had been spent on Newfoundland and Labrador, and another $30 million. The government is finding millions of dollars everywhere. Will the government undertake to invest that and ensure that the deposit is dropped?

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I do not know if the word “double-talk” is allowed in the House. However, since the member used it, let me be very clear that there is no double-talk on this side of the House. The double-talk is coming from that side of the House. We just had an example of it. That member has stood up as if the federal government on its own can do away with the CAIS deposit. The member knows, or if he does not know he should, that it cannot. It is by federal provincial agreement.

Why did the government vote against the motion? Because the Conservative motion was one of misrepresentation of the facts. The government does not have the authority on its own to do away with the CAIS deposit.

However, we have made a commitment in the budget, which I outlined earlier in my remarks. We will move to do away with the CAIS deposit. We will be in discussions with the provinces to do that. The member has the government's commitment. That is what farmers asked for and that is what we are committed to do. We have seen a lot of smoke and mirrors from over there.

The member talked about money going to Newfoundland and Labrador or to Atlantic Canada. If the member had listened to my remarks, he would have heard that the largest commitment ever in the history of Canada to the primary producers came from the federal government; $4.8 billion in 2003. It is probably $4.9 billion in 2004. That is the kind of commitment the government has given. The problem and the reality is, although the other side does not want to admit it, the marketplace is not working for producers. We have to try to work together to change that, and we will.

For heavens sake, do not say we are not committed. The biggest financial commitment ever made to the farming community was by this government.

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Mr. Speaker, I rise on a point of order. I would ask the member which province would not have the CAIS deposit program--

[The Acting Speaker (Mr. Marcel Proulx)]

The hon. member will recognize that this is not a point of order. He is attempting to continue the debate.

The hon. member for Argenteuil—Papineau—Mirabel.

[Mario Laframboise, Bloc, Argenteuil—Mirabel, QC]

Mr. Speaker, a picture is worth a thousand words. I have a mental picture of something I saw on the front page of the Journal de Montréal after the budget. It illustrated an article on the federal budget and its impact on the public with a picture of a hand containing a few coins totalling $1.33 a month. That was its impression of the budget, regardless of the area concerned.

I have a question for my colleague concerning employment insurance. They have helped themselves from the employment insurance fund—comprised of employers' and employees' contributions—to the tune of over $45 billion, and have returned to it $300 million, in other words six one-thousandths of the amount taken. There are plenty of terms that could be used by my colleagues and friends to describe this. What can the minister reply to this? Why have the 28 recommendations of the Standing Committee on Human Resources, Skills Development, Social Development and the Status of Persons with Disabilities not been implemented?

[Wayne Easter, Liberal, Malpeque, PE]

My goodness, Mr. Speaker, if any party should be thanking the federal government it is the Bloc Québécois. It represents a provincial area, and if any province in the country has done well out of this budget and over the history of time, it is the province of Quebec, on everything from finance to national marketing programs through supply management of dairy, poultry and eggs.

It is in that province where there is some profitability on the farm as a result of the Canadian programs that allow Quebec producers to market under a Canadian system. Members opposite, especially members of the Bloc, should be thanking Canadians, the Government of Canada and the finance minister for the great effort he has made and continually makes in terms of assisting many of the national programs within Quebec.

On EI, we have made changes. The minister responsible for EI announced those changes, changes that will certainly benefit the province of Quebec and many rural areas in this country where unemployment is over 10%.

[John Cannis, Liberal, Scarborough Centre, ON]

Mr. Speaker, as I rise to speak on the budget, I first want to take this opportunity to express on behalf of my family and constituents our condolences to the families and colleagues of the RCMP officers who lost their lives in this most tragic situation. My family and my constituents asked me to do so at the first opportunity.

Before I speak about the budget, let me say that I have met with the superintendents from 41 and 42 division and with councillor Michael Thompson. I have said repeatedly how we have to address this horrendous situation with the grow houses and, as an example, look at changing the Criminal Code to provide minimum sentences.

For me it is a real pleasure to have the opportunity to speak about this second budget for the 10 minutes I have. As we know, the first budget was brought in when the right hon. Prime Minister first assumed office last year. This is really the first budget in which we have had an opportunity to commence what we discussed during the campaign of 2004, the promises that were made.

Before I get into the nitty-gritty, I thank my colleague from Malpeque very much for sharing his time with me. He talked a lot about his community and the farming and fishing industries, et cetera.

It is often said that the past always affects the future. In order for me to stand here today to talk about this budget, it is incumbent upon me and very important that we take this opportunity to turn back the clock for a moment, to try not just to appreciate but more to understand why we find ourselves today in this enviable position of being able to continue to reinvest in our country as a whole. There are many areas that I hope to have an opportunity to go into, from seniors to youth, from the farming community to our urban and rural areas, et cetera.

Permit me to go back to 1993-94 when the Liberal team assumed government. It was no secret that the finances of the nation were a shambles. We were literally almost a bankrupt country, unofficially, with a very high deficit of $43 billion. We had an uncontrollable debt that was way out of whack. We had high unemployment. We had a nation that psychologically was just not there. There was no confidence.

Our approach then and now was not and is not revolutionary in any way. It is an approach of common sense and understanding, but more so one of balance. We all know that we cannot satisfy every request completely, but let us look at what has happened today.

First of all, I do not think there is another country that can boast of having seven consecutive balanced budgets. Never before in the history of our country have we had this. I dare anyone to stand and say that is not an accurate statement. It is unprecedented and unheard of. It just does not happen that for seven consecutive years a country has balanced budgets and, thank God, very healthy surpluses.

In trying to address the needs of the nation, we are now in an enviable position, not one of investing but one of continuing to reinvest. Continuing reinvestment is really continuing to meet the promises the Liberals have made over the years, promises that we made in the last budget and that we are meeting once again today.

The strength of our ability to eliminate the deficit and reduce the debt substantially, by almost $60 billion, was not on the backs of anybody. Yes, there were adjustments made, and yes, fine tuning had to be done. Nobody said we did not do it, but we went right to the people in 1993 and said we had to make some tough decisions and at the end of the day Canadians could judge us accordingly.

Madam Speaker, you and I were elected back in 1993 and made those commitments. We were in the enviable position, as we were nearing that first mandate, of being able to say to the people, “Here are tangible results”.

I am sure and confident in saying that one of the most important issues for Canadians was and is health care. Health care was the issue that was front and centre then, it is today and I am sure it will be in the future.

We asked Mr. Romanow, a well respected former premier, to do a review of health care. He came back with recommendations. Then what did we do? We not only met those recommendations but we exceeded them. Why? Because we made a commitment to Canadians: we want to make sure that each and every Canadian has the opportunity to have access to our health system no matter where they live in Canada.

Aside from that, one area that is of great concern to all of us, and we heard it loud and clear as we were going through the last election, is of course the well-being of our cities. Mayor after mayor right across the country said they needed help. I am one who has often said that in order to have a strong country we must have a strong city infrastructure, which makes for a strong province and thus results in a strong country.

Not only did we in the last budget commit fuel taxes worth billions of dollars to the provinces, for which we were applauded by the Federation of Canadian Municipalities even during the election, but it was reconfirmed in the budget again. Over the next five years it will total almost $5 billion and will continue to grow. I thank the Federation of Canadian Municipalities and the mayors for being honest and straightforward and for acknowledging the support we have been giving them. So again, on the new deal for the cities and the promises we have made, we have kept those promises.

Another area that I have great concern for, as I am sure all members do, has to do with our seniors. I must say that the member for Trinity--Spadina spearheaded this effort. I thank the Minister of Finance, because this confirms to me that the input we provide in prebudget consultations is listened to.

Yes, there was a program to unfold and increase the GIS over a period of five years, but what did the Minister of Finance do? He did it immediately and over a two year period.

Why? Because in my view and in the view of many others, seniors as a group in our country are not income generators. They rely on their pension system, on their GIS, for example. They do not have the ability to say that they are going to work 20 or 30 hours this week and get an increase. No. They are on fixed incomes. As far as I am concerned, this move tells seniors that we have heard them loud and clear and, based on a balanced approach, we are trying to do our best to address that call as well.

I was very pleased indeed that the Minister of Finance responded to our seniors. It makes me very proud when I meet with seniors and tell them what the government has done.

At the same time, it has often been asked since the budget was announced, “Where is the tax relief?” People say they got nothing for tax relief.

Members tend to forget that in 2000 a five year program rolled out by the government was the largest tax relief ever in the history of our country. It was $100 billion. As of January 2005, we are now into the fifth year of that program. In my humble opinion, there is no need to go in that direction for more tax relief when we are already into the fifth year. As we continue our healthy progress with surpluses in the future I am confident that the minister responsible will listen to us. Yes, if there is room, we will do that as well.

Another important area is the $4 billion committed to a clean environment to ensure that we do whatever we can to eliminate unwanted greenhouse gas emissions. We need to ensure that systems are developed, programs are developed, and technology is supported so that we can protect the environment, for us and future generations. The government has made the biggest investment of close to $13 billion for our military. It has done a tremendous job.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Madam Speaker, if the hon. member is being completely honest with this Parliament, he will understand that most of the military budget is scheduled for four or five years from now. The defence department has been asked to give $178 million back this year and $258 million the following year. That represents a drawback of $436 million, which almost equals the same amount that the government is pledging to it this year.

If the Liberals were to be completely honest with Canadians and the men and women of our military, they would say they would be getting x number of dollars, but it would be five years down the road, and in the meantime they have to give back x number of dollars as well.

My question is with respect to the Coast Guard funding of $275 million over a period of time to replace our Coast Guard vessels. There is a desperate need in this country to replace some of our military vessels, our ferry fleet, our laker fleet, and just as important, our Coast Guard fleet. We were glad to see the government taking some small step toward improving that, but my fear is that the government will purchase those ships from other countries thus using taxpayers' dollars to assist those other countries.

We are asking the government to commit to its 2001 report called “Breaking Through: Canadian Shipbuilding Industry” and prepare a shipbuilding policy for Canada so that taxpayers' dollars would go toward assisting Canadian shipyards and workers. The government did this for the auto industry and the aerospace sector.

Will the member commit his government to investing in and ensuring that the ships that are required by our Coast Guard will definitely be built in Canada?

[John Cannis, Liberal, Scarborough Centre, ON]

Madam Speaker, I listened to the member's comments and I will respond with respect to the military first. I am not in a position to say whether it was good or bad, but neither is the member who asked the question. We are not going to talk about honesty.

The commander-in-chief, Commander Hillier, stood up after the budget and thanked the government for committing the billions of dollars that it did to the military. Those are the people who are front and centre, not the member nor myself. They are the ones who pass judgment, not myself. Unless the military lied to the nation on public television that it was very satisfied, then I am lying to the House.

The member knows very well how much I have worked with him on the issue of shipbuilding in Canada. We must understand that times are changing. Industries change; conditions change. We develop our niches, for example, in certain specialities and countries come here to do other things, whether it be auto et cetera. As far as the shipbuilding industry is concerned, it is a very difficult issue. We have provided some creative ways to address it. I am hopeful that some day we will be able to retain some of those quality jobs in Canada.

[Rob Nicholson, Conservative, Niagara Falls, ON]

Madam Speaker, perhaps the hon. member could clarify something. It is quite correct that the chief of defence said that he welcomed new expenditures in defence. It seems to me the hon. member is going much too far. He somehow then equates that the military is happy. I think those were his words. I am sure the military is a long way from being happy. I do not think the hon. member would like to leave that impression with the House.

The neglect of Canada's military is a national disgrace. I am sure that if we asked anybody in the military if they wanted to see another 50 bucks going into the military, they would say, “Yes, of course, $50, $50 million, $5 billion”. They want to see billions of dollars.

It is going too far for this hon. member to say the military is happy. Putting the general on the spot when he makes himself available to the press, of course, he is going to say he wants to see new funding for the military, but what the Liberals have done to the military in the past and what the military might expect from the Liberals in the future, I think goes way beyond that. I would like him to comment on that.

I would also like him to comment on articles that are starting to appear in the newspapers on this whole subject of clawbacks. This is a classic Liberal trick. The government announces $100. If we look closely enough, we would find out that the $50 has been announced any number of times. So, that is part of the $100 announcement. Then there is something called efficiencies, where we are expected to find savings within the $100.

I want to give the member some time to comment on both. Are they pleased, and tell me about the clawback in the federal proposals on defence?

[John Cannis, Liberal, Scarborough Centre, ON]

Madam Speaker, if anybody knows about clawbacks, it is the Progressive Conservative Party, the spinoff of the Reform Party.

I am a little ticked off. I do leave that impression. I challenge that member to go out there and line up any military person to come before the tube or publicly and make a different statement. So I challenge him.

He can stand in this House and say all the hogwash he wants because he knows he can get away with it. He is full of hot air as far as I am concerned. Let him line up the military and we will see what the response is. In essence, what he is doing here is calling the commander a liar. Let him go out there and say that.

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Madam Speaker, I will be sharing my time with the hon. member for Niagara Falls.

Continuing on the comments made by the Parliamentary Secretary to the Minister of Agriculture and Agri-Food, there is no doubt that there is not a province in Canada that will not agree to the CAIS program deposit requirement for producers being dropped. What is required in fact is additional funding from the federal government to ensure that this silly requirement is gone. It should never have been there. It is an annoyance to the farmers who are looking for it to be dropped, and to be dropped now. The government simply has to make a statement that it is not going to be there. That is all that is required. It is coming up to the end of March and farmers are making plans to seed. They need to know that. They need to have the government actually committing to doing something.

The minister has said that promises were made and promises were kept, but the fact of the matter is that many promises have been broken and what promises were made were meagre promises. When we look at the budget and the big talk about the basic personal exemption going up, it does not really happen until 2007-08. Some people have said that if they could buy a large pizza, they would be very fortunate. That is the tax reduction that is being made by the government. That is the promise.

The promises that the Liberals now make they do not keep. They are now relying on promises that they do not have to carry out, promises that will not take place for two, three or four years, and they will not be in government at that point. All they are trying to do is put some window dressing on this budget. They are trying to spin-doctor it. They are trying to market it, but when we really look at what they are promising, it is very little.

Let us have a look. The corporate surtax does not start until 2007-08. The corporate tax rate does not get reduced until 2008-09 and 2010. The Liberals will not be in government at that time. The excise tax on jewellery, really an archaic tax that should have been gone a long time ago, is going to be reduced 2% per year.

They are meagre promises if they are promises at all, and promises that will not need to be kept by them. The gas tax revenue is also over a five year period, $600 million to start with, a mere pittance compared to what the cities and municipalities need. When we look at health care, it is over 10 years, a specific budget of $805 million over five years, and so on: child care, five years; Kyoto, five years; and the military, same thing. They are really promising very little in the budget.

When we come to the RRSP itself, much has been made that the ceiling amount for contributions will be $19,000 for 2006, $20,000 for 2007, and 2008 and 2009 for the concluding amounts. I can tell the House that it is not much of a benefit to the small business people, small entrepreneurs and ordinary families. The data compiled by Statistics Canada shows that, adjusted for inflation, median family income before taxes remains essentially unchanged at $55,000 and continues at about that mark today.

Most families and most small businessmen, after paying mortgages, tax, food and utilities, have little money left to save for their children's post-secondary education, let alone RRSPs. According to Statistics Canada, the median RRSP contribution in 2003 was $2,600. That is not average. That is the median, which means that half of all contributors made even smaller deposits than that. So much for helping low and modest income Canadians.

The Liberal government also promised, through its housing minister, that it would provide $1.5 billion for housing assistance over the next five years. Again it is five years. It said it would develop a flexible tool box to deal with rent supplements, housing construction, zero down payment purchases, and incentives to convert buildings into rental apartments. The trouble is that the tool box is empty. Not a penny was allocated in this budget to the degree that was promised by the housing minister.

Then we go to agriculture.The finance minister says that the year 2004 was another difficult year for Canadian farmers, faced with challenges and a cool wet harvest in the Prairies. The reality in my constituency is that not only was that a problem, but there were four frosts and two early frosts that destroyed what would otherwise have been a bumper crop, and there is no assistance from the government. Even crop insurance would not help. The minister is just not paying attention to what is happening on the Prairies.

On February 9, it says in the budget, the U.S. confirmed its intention to reopen the border on March 7 to Canadian cattle under 30 months of age. The government, it says, is hopeful that such a reopening will facilitate the strong recovery of the cattle livestock industry.

That was all that the government had for its plan, hoping against hope that the border would open but it did not. Interestingly enough, the judge who granted the interim injunction said, “the USDA failed to provide the specific basis for the conclusion that its actions carried acceptable risk to public health and failed to provide the data on which each of the agency's critical assumptions were based”.

One has to wonder how well Canada's case was substantiated by the USDA and whether the Government of Canada did its homework in its presentation. Also, Canada was notably absent at the injunction hearing when it should have been there making the case for Canadian ranchers and farmers. Where was the government if it were that concerned about them?

Also, we find that much was made of the government's contribution to the farming industry. The fact is that is over many years and after administration and bureaucracy has eaten up most of the cost in a confusing program that no one really wants, the government itself really does not understand, without responses in 90 days or 120 days, and with the left hand not knowing what the right hand is doing. Farmers are getting frustrated. The program is not working and the government is resting on its laurels on that aspect of it alone.

In the budget it says:

Canada’s farmers and farm communities have shown enormous resilience over the past several years in coping with an unprecedented combination of crises arising from weather, animal disease and difficult market conditions abroad

The fact is that resilience is starting to wane because the government is not prepared to stand with the farmers in their time of greatest and strongest need. The government is merely talking and postulating and not doing what has to be done.

In Saskatchewan the farm cash receipts in expenses and income from 2003-05 as compiled by Statistics Canada and forecast by Agriculture and Agri-food Canada shows that crop receipts were down minus 9%. That is the percentage change, the net cash income minus 44%. The realized net income in Saskatchewan is projected to drop $486 million in the negative. That is not making an income and yet the minister has the audacity to suggest that farmers are being resilient and doing well, and that he has put a lot of money into the program and farmers simply need to carry on.

When we look at the the charts we see that the projected income for 2005 is below what it was in 1991. The agriculture minister last week at the Canadian Federation of Agriculture meeting found one farmer after another complaining that the federal government did not appear to understand the pressing needs of producers. We can tell that when we listen to the speech on the budget by the minister's representative.

Ron Bonnett, president of the Ontario Federation of Agriculture, said that one of the things that was completely missing from the budget document was the urgency that is facing the farm community right now There is a crisis and the government does not think it is. Terry Hildebrandt, president of the Agricultural Producers Association of Saskatchewan said that farm income was the overriding issue in agriculture today and that the federal government was failing to take it seriously. Many producers in our province are facing a bleak future if there is no immediate short term assistance.

In the middle of that, the government has chosen to do away with and cancel the farm improvement loan program which is the very program that farms use to borrow against their equity. Under that program, they could borrow 90% of their equity at favourable interest rates. Saskatchewan happened to utilize that program, 70% of the total program across all of Canada. At least 10% to 15% of the loan program was used by my constituents to buy land, equipment and breeding stock. That program was cancelled in the middle of what is going on here in Canada.

A constituent called me and said that he had never called an MP but he said that it was getting awfully quiet in the rural community. Farmers are tired of fighting with the government. They are getting ready to throw in the towel. He took a 900 bushel load of grain and was able to buy nine seeder boots for his seeder and it contains forty-eight.

I spoke with an auctioneer who said that sales in land and machinery were increasing, that the Americans were buying farm equipment and that land across the border was worth $70,000 to $80,000 but that we were doing nothing to help Saskatchewan farmers.

It is amazing when I look at the auction list. There are 166 auction sales in Saskatchewan and 49 of them are in my constituency. I could list the names. The minister could spend all of March and April at these sales if he wished.

[Mario Laframboise, Bloc, Argenteuil—Mirabel, QC]

Madam Speaker, I thought just then that my Conservative colleague was repeating the remarks by the hon. Liberal member who told us that there has been a great reduction in the deficit. The great reduction in the deficit, we know—and my hon. colleague knows it, too—has been achieved at the expense of the provinces.

When the current Prime Minister began his term as finance minister, the federal government was paying 25% of health care costs. He reduced this to 12%. The Romanow report asks him to reinvest in health up to the level of federal investment in the early 1980s.

The elimination of the federal deficit has been achieved at the expense of the provinces, the workers, the unemployed. They have taken $45 billion from the employment insurance fund. Of course, that was at the expense of the neediest. They have abolished the support that had been available for social housing.

And obviously it is the same for the elderly, who were denied retroactive payment of the Guaranteed Income Supplement. That too was at the expense of the neediest.

My question for the Conservative member is quite simple. Is his party prepared to support the Bloc Québécois amendment to the amendment calling for correction of the fiscal imbalance? The provinces must have the resources they need to get back on track. Everyone across Canada recognizes that there is too much money in Ottawa. The elimination of the deficit has been achieved at the expense of the provinces and it is time to give them something back.

Is the hon. member prepared to support the Bloc Québécois amendment to the amendment demanding that the federal government resolve the fiscal imbalance and the employment insurance problem, and implement the 28 recommendations of the Standing Committee on Human Resources, Skills Development, Social Development and the Status of Persons with Disabilities, which his party supported? Is the hon. member prepared to support the Bloc's amendment to the amendment?

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Madam Speaker, there is no question that the government has amassed huge surpluses and many times at the expense of the provinces and particular sector groups, such as the farmers in Saskatchewan who could use an immediate payment for seeding at $50 or $60 an acre before March. The government has the money to do those kinds of things but it has chosen not to. It could direct those funds. It has done so to other projects that help particular sector groups, including those in Quebec.

As far as the position to be taken on the Bloc motion tonight, the member will have to attend here at the appropriate time and see how the vote goes.

However I can tell the member that there is no question that the government has not only made huge surpluses on the backs of ordinary Canadians, but it has funded pet projects of its own and has ignored various sectors in Canada that are undergoing the greatest crisis in their lifetime.

Farming as we know it on the prairies is about to disappear. There are 169 auction sales and 49 of them in my constituency. The government is doing nothing to help farmers and to bail out good families that had a good farm income. These are families that did well in the past but are now giving up. Farmers need some of those funds now. The federal government should be using those funds and looking after parts of Saskatchewan and other parts of this country that need that assistance now.

[Peter Adams, Liberal, Parliamentary Secretary to the Minister of Human Resources and Skills Development]

Madam Speaker, I heard my colleague mention huge surpluses. Would he give us some indication of what he thinks these are? My sense is that the surpluses of recent years have been 3% or 4% at the very most. I do not think we have reached 5%.

How does the member think the government should be run? Should we try to run on a deficit? Should we aim for a balanced budget or should we aim for these tiny surpluses, a few per cent, so that we can deal with the debt?

As the member knows, the government's largest single payment in this budget, in the last budget and in the budget before, in times of very low interest, was the $35 billion payment on the debt. Where are these huge surpluses that he is talking about?

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Madam Speaker, the finance minister projected $1.9 billion which turned out to be $9.1 billion by some very creative financing, and they have money hidden--

[An hon. member]

They were using a Liberal calculator.

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Yes, they are using a Liberal calculator. They have trust funds sets aside; $3 billion in reserves to meet situations, they say. Where do they get those funds? They get them from overtaxing Canadians and not allowing any broad based tax relief that is meaningful. They are taking in funds through the GST. They are collecting money that ordinary taxpayers are paying and not giving it back to them when they need it in a crisis situation, like the farm communities in Saskatchewan. There were 49 sales every day of the month in March. The finance minister from Saskatchewan should be there visiting so he realizes there is a crisis there and money is not being used as it ought to be used in that particular province, the minister's home province.

[Rob Nicholson, Conservative, Niagara Falls, ON]

Madam Speaker, I would like to pick up for a second on the whole question of surpluses. I cannot believe there is anyone left in the country who is going to buy into any of the predictions by the Liberal Party. It is a little joke that the Liberals have on Canadians, if it were not so tragic in terms of overtaxation. The same nonsense goes on every year. The Liberals predicted $1.9 billion and then lo and behold in the hallways they stumbled over another $7 billion. I never believed any of that nonsense.

During the election the Liberals said that the numbers did not add up, that the Bank of Montreal was overpredicting the surplus. I never bought into it. If they think they fooled some of their constituents, I do not think they will be able to do it again. I think it has been shown what they truly are. This whole business of trying to fool Canadians and continue to overtax them is something Canadians have had enough of. All their projections we take with a grain of salt, as do most Canadians. Canadians are not buying into it.

There are a couple of other things I do not think Canadians are going to buy into. We hear announcement after announcement. For example, the Liberal day care policy has been a part of every election campaign for the last 12 years. The Liberals keep making the announcement and no one ever sees a dime from these announcements.

It is like the announcement on the gas tax rebate for the cities. A couple of years ago the current Prime Minister was in Winnipeg speaking to a gathering of municipal politicians. He made this grand announcement, that the Liberals were going to move forward on the gas tax rebate for municipalities. For heaven's sake, that was over two years ago and the municipalities are still waiting for it.

Now the Liberals have taken it to a new level. Part of the logic of the Liberals must be that if they make the announcement enough times then somehow it has happened. On the weekend, I heard the Prime Minister say on a couple of these things, “Promises kept”.

Good heavens above, the municipalities are still waiting for their cheques. I say to him, skip the announcement. How many times is he going to announce some of these things? Could he please send the cheques? That is what the cities want.

The Liberals have taken it to another level. They do not just keep announcing it. Now they say that the promises have been kept. The hon. members across heard all that and they must have been chuckling to themselves. It is a whole new spin on the idea of government announcements.

The budget is not all bad. There are some positive things in it. Interestingly enough, a number of the positive things in the budget came from members of the Conservative Party.

The member for Prince George--Peace River, my seatmate the House leader for the Conservative Party, should take a great deal of pride and satisfaction that his proposal for a new non-refundable $10,000 credit for expenses that couples incur in child adoption was in the budget. He should be very proud of that. I was pleased to see that in the budget.

I flipped through the budget. I looked for things like expenditures on border security and infrastructure and I see references to those. The government acknowledges that it has a responsibility in the whole question of border security.

I was asked by the local press in my riding whether $400 million was enough. It is enough when the job is done efficiently and the borders operate in an effective manner, when goods and services move across Canada's borders and at the same time Canada's security is maintained. Whatever that amount is, is what the country must commit itself to. I am pleased that there are references to that in the budget.

There is one thing I did not see in the budget and it is a glaring oversight. This was raised by one of my colleagues after he heard the budget speech and had a chance to look at the budget. He thinks there is a misprint in the budget. He asked where the chapter is on agriculture. That is a good question. Where is the chapter on agriculture?

I looked at the budget plan 2005 because I thought it must be there somewhere. One has to look real hard. It is hard to find because it does not get its own chapter and there is very little provided. It covers a couple of pages and is very inadequate.

The budget talks about the Canadian agricultural income stabilization program, a program that is of interest to the farmers in my area. The government talks about good intentions, that the government will work with its provincial partners, that it realizes there is a problem. That is an announcement that the Liberals want to do something about it. We had a debate on this issue about a month ago. I say to the government to get on with it. If the government realizes there is a problem with the program, it should get going and do something about it.

What disappointed me the most is the whole issue with respect to the federal excise tax as it applies to the wine industry and small breweries. It had been recommended to the government that it reduce or eliminate that tax. There was considerable hope within those industries. It would make a big difference to them. It would affect the smaller wineries and breweries. The federal government's budget does not sink or swim, the finances of the country do not depend on the relatively small amount of money collected from that tax. Representatives of the wine industry were optimistic that something would be done. I was very disappointed to read on page 158:

With respect to beer and wine, the Committee acknowledged that limited fiscal resources narrow the range of tax relief that can be funded. The recommendations with respect to beer and wine will remain under consideration.

Is that not wonderful. It is under consideration. That is a real shame. I ask the government even at this point to please bring in something, a separate bill. It would be of tremendous help to those industries that are so important to the country. I know the members of my party would welcome and support that.

The Minister of Transport has to be a very disappointed individual. I believe his comments that he would like to see airport rents reduced. It is false economy to try to make our airports as expensive as possible because the costs are passed on to the travelling public. It makes air transport, which is critical for the country's transportation infrastructure, more expensive. I know the minister joins with me and other members of the transport committee and the transport critic in saying it would have been wonderful to see that.

The Minister of Finance will say that these things are under consideration, but that is like a lot of other things. Everything is under consideration and we only get announcements. When does it finally happen? The Minister of Transport must be very disappointed about that.

Quite frankly, I was initially encouraged by comments with respect to defence spending. Defence has been terribly underfunded by the present government. The Liberals have continued this pattern for their 11 and one-half years in office. It is wrong. It is a bad idea. It hurts Canada. When there was all the foofaraw in the Minister of Finance's speech about all this money for defence, I was very pleased.

I went to the budget plan and again, this is not something cooked up by the Conservative Party or other opposition parties; the government puts these things out. If we flip to page 222, we will see defence funding. The fascinating thing is the category “New medium capacity helicopters, logistics trucks, utility aircraft and JTF2 facility”, all great things for Canada's military. Is this not a great idea? As we say in the legal profession, never mind the big print, always look for the small print. What does the government plan to spend on those categories for fiscal year 2005-06? Zero. What about next year, 2006-07? Zero. Like so much of the budget, it is all back-end loaded.

The government cannot get straight how much money it has to spend for the present year. It cannot seem to come up with the right numbers to predict the present year's surplus, so try and figure out how good its predictions are for what it will do in 2007, 2008 and 2009. That is in the area of fiscal never-never land for the government. It is very disappointing.

[Don Boudria, Liberal, Glengarry—Prescott—Russell, ON]

Madam Speaker, I listened very attentively to the hon. member when he was talking about surpluses.The first thing that came to my mind, if my memory serves me correctly, is that the hon. member was twice a member under the Brian Mulroney administration that had, believe it or not, nine consecutive budgets that not only were in deficit but did not even balance with the deficit that the Conservatives had predicted they would make. In other words, not only did the budgets not balance, not only were the Conservatives short of money, but they were even short compared to that which they said they would do. That is the kind of expertise of the Mulroney government. I was a little shocked to hear the hon. member for Niagara Falls talk about what to do with a surplus, given the experience that he lived some years ago.

I want to ask him if he recalls, as I do, that more than half of the accumulated debt of Canada was generated under the prime ministership of one man, Brian Mulroney. Who was a member of Brian Mulroney's caucus? The hon. member for Niagara Falls.

I say to the member that he is on rather thin ice in saying that according to him, the present Minister of Finance is not able to predict finances correctly. Since 1996 we have had nothing else but balanced budgets under the leadership of the present Prime Minister when he was minister of finance, as well as his two successors.

I would ask the member to respond to two things

He referred to the CAIS program. I agree with him that the Minister of Finance is quite right in wanting these premiums eliminated. Does the member not know that it is federal-provincial? Of course the other component of the federal-provincial, namely the provincial, has to agree with it. That is the first proposition.

The other one is on the defence budget where he said that the major procurement will be three years from now. Surely the member will recall that when we purchase equipment like helicopters, ships or airplanes, that is how long the delivery time is. We cannot order them retroactively. We do not buy these things as if they were sitting on a used car lot. They have to be designed. They have to be built. We have to obtain them. We have to get delivery and we do not get that next week. It is not the same as ordering a new Chevrolet Cavalier.

[Rob Nicholson, Conservative, Niagara Falls, ON]

Madam Speaker, I am very pleased to answer some of the comments raised by the hon. member for Glengarry—Prescott—Russell.

I thought he was going to get into it. He has a pretty good memory but he forgot to talk about the father of the Canadian deficit, Pierre Trudeau. The hon. member has a good memory. He will remember that in 1984 the Liberals' good friend the Auditor General was helping out, pointing out things for the Liberal Party even back then. The Auditor General does not just point out the mistakes they make now. The Auditor General back then said that the government of Mr. Trudeau was in danger of losing control of the government spending. That is how bad it was.

I appreciate all the attention the hon. member has given me for being a member of that government. Only modesty would tell him I did not run the government all by myself during those nine years. There were a few other people who helped me. Not all the decisions were mine, but I am certainly pleased and proud with the decisions that were made.

In answer to some of the specific items the hon. member mentioned about the CAIS program, if the hon. member's government knows this is a problem, why has it not called its friends in the provincial government to sit down and do something about it? The federal government should get on the phone with its good friend, Dalton McGuinty, who has been helping the federal Liberals out for the last year or so. Members will remember during the election that Mr. McGuinty helped them out. The federal Liberals should get on the phone to their friends, sit down and renegotiate these things.

It is just like the helicopters. How long ago was it the government announced that new helicopters were needed? Yes, the military needs them and the government has announced that again and the member has said it is going to take another couple of years. He knows as well as I do that those helicopters and all the other equipment for military defence should have been in place 10 years ago.

[Jean Lapierre, Liberal, Minister of Transport]

Madam Speaker, I am very pleased to rise today to participate in this budget debate, as I am primarily in a position to provide Quebec's perspective. My hon. colleagues opposite will be happy to see that the budget is being scrutinized and that we will be able to tell our fellow citizens in Quebec what it means exactly. I encourage them to listen and to really grasp the dynamic of this budget and what it does for our province.

Naturally, the main component is health. This being our first budget since the election, we have to fulfill our commitments. As our Prime Minister said this weekend, “Promise made, promise kept”. Such was the theme of his speeches over the weekend, but it was also the central theme of this budget, particularly with respect to health.

As everyone is well aware, the first action taken by this government was to sign a historic health accord with the provinces. This is a flexible agreement recognizing the responsibility of all parties, which, for the first time in many years, allowed the Premier of Quebec and all other premiers to sign an agreement together. It provides for the transfer, over the next 10 years, of $41.3 billion to the provinces. For Quebec, this asymmetrical agreement translates into an extra $236 million for 2004-05. And next year, in 2005-06, an additional $471 million will be added to the province's coffers. This will allow the province to provide timely health care with state of the art equipment and technology. This was a key commitment, and it has been fully met.

There is, of course, the equalization issue. Our government had promised to correct the significant differences from one year to the next, depending on the formula, which have put our provincial colleagues in a bit of a tight spot. Our budget also includes this agreement. As a result, in 2004-05, Quebec will be receiving $477 million more in equalization payments, for a total of nearly $3.8 billion.

The other commitments made during the election campaign and in our platform are also being fulfilled. We wanted to set up a national child care program to ensure that children thrive in early childhood and to provide an alternative for families. For example, family heads who decide to join the labour force will have access to an effective child care network all across the country.

Quebec is the example to follow in this regard. It has the most developed child care program. This program of $5 billion over a five-year period, will provide Quebec with unexpected transfers from the federal government. It was already committing money to child care, spending over $2 billion annually on it. So, this will be a net transfer. We are talking about a transfer of some $700 million to the provinces, although Quebec will, as soon as the agreement is signed, get $165 million for its social initiatives. We are talking about new and unexpected money that can be used precisely to reduce the financial pressures on the Quebec government.

Last week, some of my colleagues were not here, but I know that they would have applauded the Minister of Human Resources and Skills Development, who signed an agreement on parental leave. Such an agreement had been requested for a long time and it was reached by a federal minister who cares about this issue and by her provincial counterpart, who also wanted resolution in good faith. Once again, a lump sum of $200 million will be transferred to the province by March 31.

In other words, the Quebec government will have this $200 million to implement a program more generous than the federal one. Quebec has decided that one of its priorities is a more generous parental leave program. There is a national program, but we will not stand in the way of a province that wants to improve upon it. That is the beauty of flexible federalism.

On the national level, a specific commitment was made. For Quebec, this means that $750 million in tax room has been freed up, and this money will go to the provincial program. This means that any other province in Canada wishing to create a more generous parental leave program could easily conclude a similar agreement. That is what flexibility means. It means ensuring that public needs come first and enabling those who wish to do more to do so.

This historic agreement signed last week should be good news for everyone. It means that Quebec families will have access to parental leave generous enough to stimulate the birth rate.

This budget also contains the famous new deal for cities and communities. We know that our Prime Minister made a major commitment to this. We know that the cities and municipalities do not have sufficient resources for all their infrastructure needs. We know that property tax revenues are often insufficient. That is why this budget allocates $5 billion over the next five years in order to give the municipalities more room to breathe. We want to ensure that they will have the funds they need for such important things, I hope, as public transportation.

There is no need to hide the truth. Consider the example of the Montreal metro, which was built for Expo 67. Construction was completed in 1966. It has never been renovated, with the exception of the agreement last year allocating a hundred million dollars for electronics. However, Montreal metro trains and infrastructure need $1.3 billion in repairs.

New outside revenue is therefore needed to enable the major cities to develop viable and reliable public transportation systems. The new deal for Canada's cities and municipalities also offers amazing flexibility. Each province will be able to enter into a bilateral agreement to ensure that its specific needs are met, while establishing of course—or so I hope—national parameters on which agreement can be reached.

It is fairly obvious to everyone that we all have a responsibility with respect to public transportation, particularly since Canada is a signatory to the Kyoto protocol. As far as water is concerned, clearly municipalities in all provinces of this country are experiencing major problems that cannot be solved without more funding than they have available. Goodness knows, the need for sustainable infrastructure is great.

Once again, in keeping with the Canadian Constitution, there will be a program to improve the quality of life for our fellow citizens. While respecting provincial jurisdiction over municipal affairs, we will need to work toward shared objectives in order to achieve results that would otherwise not be achievable. This new deal was created for a reason: our Prime Minister has heard the mayors of the many towns and villages he has visited in Canada in recent years. He has heard what they had to say and promised to meet their expectations, and with this budget he has made good on that promise.

I would like my colleagues from Quebec, for example, to know that the first year of the program has projected expenditures of some $600 million, which means $132 million will go to Quebec cities and municipalities. That is just for the first year. Once the fifth year comes around, $2 billion will be going annually to help the municipalities.

For Quebec, this is going to represent something like $460 million, year after year. Mayors and councillors will be able to propose worthwhile projects, and we will tell them that we have the money to carry them out. When we talk about partnership in this country, it means that the governments of Canada, Quebec and municipalities are going to work together to improve the quality of life of our fellow citizens.

I will take a moment to talk about employment insurance. Because the members of Parliament have listened, the Liberal members have created committees—members who are here and some who were here during the last Parliament—because they wanted to respond to the needs on the unemployed, in Canada as in Quebec. They understood the message that there was a need for an independent statutory mechanism to set contribution rates.

Everyone wanted a mechanism that would bring income and expenditures into balance. That will not happen at the whim of the government. It will be up to the independent chief actuary of the Employment Insurance Commission to set the rates. Accordingly, we will strive for balance.

The real demand of the unemployed, however, concerns the way benefits are calculated. We have listened to them, we have heard them, and at the moment, we are honouring a commitment that from now on, the 14 best weeks would be taken into account. We have all listened to the seasonal workers telling us that they have no incentive to work for small weeks, because that will reduce their benefits for the rest of the year.

In this reform, we are responding to the most basic request. Calculations will be based on the best 14 weeks of 52. As a result, whether a week is small or big, the unemployed will be encouraged to work.

We are personally committed to work. What we want to make sure of is that our fellow citizens have employment. We are positive, we do not spend our time thinking of problems. We want to ensure that there are jobs available. Still, if, through misfortune, in circumstances beyond his control, or because of the nature of the region he lives in, a person loses his job, we do not want to penalize him. That is why the Minister of Human Resources and Skills Development has proposed this reform.

Another commitment made by the Prime Minister in the debate concerned new entrants or workers who re-enter the labour force after having been away for several years. To fulfill the Prime Minister's formal commitment in this respect, we have reduced from 910 hours to 840 hours the eligibility requirement.

Once again, we have delivered on our EI commitments. This reform is complete. There is no going back to the old system.

I know that some people play politics by looking through a rear-view mirror. That is precisely what our colleagues from the Bloc Québécois are doing. They are looking through a rear-view mirror to see what is ahead. The truth of the matter is that we will not go back to the old 10-42 syndrome. That is clear.

The Canadian economy is going relatively well, in fact, very well. The opportunities are there and, at the same time, we have competitors around the world who do not get to wonder whether they will have to work 10, 12 or 14 weeks because, in their case, it is often 52 weeks. We really have to be aware of the reality of competition.

I think that we have a fair and equitable program. We must also understand the very essence of the program. We are talking about an employment insurance program, not an income supplement program. It is important to understand that.

In recent days, I have met people who are concerned about this issue, and they are very pleased with the reform proposed by the government. They believe that we have now achieved a balance. Therefore, the reform is final, but it is also fair.

We had made another commitment during the election campaign, this one concerning seniors. As we know, some seniors were not as fortunate as we are today to benefit from programs such as the Canada Pension Plan or to have private pension plans. In their time, they had access to jobs that did not provide that kind of benefits. They have had to retire only on the basic pension and the income supplement.

These people are definitely disadvantaged, because their income is too low. This is why the budget includes a $2.77 billion commitment, over five years, for the elderly. We know that these people are the neediest in our society and we want to help them. In concrete terms, this means that, by the year 2007, a person living alone will get a monthly increase of $36. Seniors who are watching us know what a difference $36 per month can make. In the case of a couple, the monthly increase will be $58 and this progression will continue, because we are talking about a $2.7 billion program over five years.

But this is not all. We also recognized the reality of caregivers. When we get older, members of our family often want to help us and this is appreciated. It is appreciated by the person in need, but also by society as a whole. We wanted to double immediately, as of this year, the deduction for caregivers, from $5,000 to $10,000. We think that in a society like ours, those who look after the well-being of their parents deserve some support. This is why they will now be entitled to a deduction of up to $10,000, beginning in 2005. We think this is fair to these people.

Then there is the tax reduction. Over the next few years, some 240,000 seniors will no longer have to pay taxes, because their income is less than $10,000.

We also thought about younger people, who should prepare for retirement. We did not forget them and this is why the RSP ceiling will be adjusted to reflect the reality and will be increased to $22,000. We were told us that more flexibility was necessary. The program will be more flexible, since the 30% limit on foreign stocks is increased significantly.

People in the private sector watch us and listen to us and wonder “what's in this budget for me?” The first thing the private sector needs is a healthy economy. We are offering an economy that provides opportunities. However, we are saying that the corporate surtax will be eliminated in order to remain competitive with the American tax system, in particular. As well, corporate tax will be decreased gradually from 21% to 19%. This will maintain our current tax advantage in order to keep our businesses competitive with the Americans.

The environment is a priority for this government, not just in theory but also in reality. Five billion dollars have been set aside for it. For example, $200 million have been allocated to new energies such as wind power. In coming months we will see the level of commitment of this government. It has also agreed to host a major conference in Montreal this coming November, to be attended by 10,000 environmentalists from all over the world. By doing so, we are of course, putting more pressure on ourselves, since these people will be in our country looking at what is being done here. We are certain that the Government of Canada will demonstrate its leadership. We are delighted to welcome to this country the 10,000 people most attuned to environmental realities, because our performance will hold up well to world scrutiny. Thus, in environmental terms, our colleague, the Minister of the Environment, will carry on.

I have only a minute left, I know, but there is so much good news in this budget that I would need another hour.

I must at least point out that, as far as the Canadian Forces are concerned, the $13 billion commitment over five years shows our respect for the men and women who are engaged in the defence of this country, particularly in newer roles such as peace keeping, humanitarian aid and assistance to emerging democracies. The men and women in our forces deserve proper equipment that will not fail them when they are putting their lives in danger on our behalf.

I could also mention the Canadian Space Agency in Saint-Hubert. There is $100 million in additional funding for robotics and $200 million for a new generation of remote sensing satellites. There are so many other things I could mention. I must curb my enthusiasm, however, because of time constraints. I have no problem with that.

[Marcel Gagnon, Bloc, Saint-Maurice—Champlain, QC]

Madam Speaker, the previous speaker is right to curb his enthusiasm. Rarely have I heard a more arrogant, dishonest and insulting speech. It does not make any sense.

I will raise only the issue of seniors. Over the past 12 years, this government has taken $3.2 billion from the poorest seniors. Today, many of them have passed away. We are asking for seniors to get retroactive payments of the money they are owed, but the government is refusing.

Now, it is boasting about the allocation in this budget of $2.7 billion over five years for seniors, when $3.2 billion was taken from them over the past 12 years. Is there anything more arrogant and more insulting to seniors than that? In 2007, the government will start repaying not the people from whom it took this money, since they will be gone, but rather seniors newly entitled to the guaranteed income supplement. Payment of this $2.7 billion will be completed within five years. There is no way the previous speaker could have more deliberately misled our seniors.

I could talk about the unemployed, but I will stop here, to give him the opportunity to respond. This makes absolutely no sense. Some $45 billion was taken from the workers and the unemployed, and this is what they are getting back. Yet, the government is boasting about a budget full of good news. It is, instead, an arrogant and insulting budget for Quebec.

[Jean Lapierre, Liberal, Outremont, QC]

Madam Speaker, I am somewhat discouraged by the remarks of my colleague from Saint-Maurice—Champlain. As one who claims to be a champion of seniors, he should applaud the fact that an additional $2.7 billion is going to those seniors who receive the guaranteed income supplement. I find it totally unacceptable that he is not happy for seniors and for Quebec.

I realize that, for him, there will never be any good news, the federal government will never do anything right. The member is here because he does not want the system to work. He does not want seniors to be happy, he wants them to be unhappy. He is here to ensure that Parliament and the country do not work. We have no lessons to learn from the member.

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

Madam Speaker, customarily in budget debates, when ministers responsible for their portfolio come to the House to debate the budget, they usually spend time talking about their portfolios. The Minister of Transport has talked about the Canada space program, employment insurance, everything but transport, and I suspect for good reason. The minister, at a breakfast the day after the budget was delivered, said that he was “very disappointed with the budget”. He should have been disappointed as the transport minister because the transport sector of our economy got absolutely nothing whatsoever with regard to the budget.

The minister staked his reputation as the transport minister on having a sustained freeze on airport rents so that the government would stop viewing our airline industry as a source of revenue and start seeing it as part of Canada's national infrastructure. He failed to deliver for the air industry. He joked at the breakfast that he would like to put the finance minister on a do not fly list, and he said that he was very disappointed with the budget. I suspect he has been taken out to the woodshed, which is why all of a sudden he is now a latter day champion of the budget.

I, Canadians, the air industry and the transport committee, which I have sat on for four years, would like to know this. When we unanimously demanded that the government freeze and reduce airport rents, why did the minister fail to get the job done, and why does the government persistently put the screws to Canada's airport industry and to Canadian travellers?