Madam Speaker, I am speaking on behalf of my constituents today on Bill C-48, an agreement to increase spending in a way that I think is unhealthy. This agreement is bad for Canada's economy, for my constituents, and represents a missed opportunity for the House and the government to improve the lives of Canadians.
Bill C-48 enacts $4.5 billion of the $4.6 billion deal struck by the Liberals with the NDP to make payments in fiscal years 2005-06 and 2006-07, and takes away the tax relief that was promised by the Prime Minister in the original budget that was presented to Canadians in the House on February 23. The bill is heavy on the public purse but light on details. It commits hundreds of millions of dollars under broad areas without any concrete plans as to how that money would be spent.
The bill authorizes cabinet to design and implement programs under the vague policy framework of the bill and to make payments in any manner. The bill contains an open-ended statement:
The Governor in Council may specify the particular purposes for which payments referred to in subsection (1) may be made and the amounts of those payments for the relevant fiscal year.
Put another way, the legislation creates an undefined multibillion dollar slush fund for the Liberal cabinet members to spend in the way that they see fit as we head into an election campaign. This is economically and democratically unacceptable.
Condemnation of the NDP-Liberal budget is not just mine. In a letter to the finance minister and the Prime Minister, the Canadian Chamber of Commerce wrote:
Bill C-48, the budget amendment that fulfills the terms of the Liberal-NDP agreement at the expense of corporate tax rate cuts, was concluded quickly and with little effort to determine whether the new spending initiatives are effective in boosting productivity and fostering long-term economic growth. This politically motivated action showed a clear lack of planning and long-term strategic thinking on the part of the federal government.
Nancy Hughes Anthony, president and CEO of the Canadian Chamber of Commerce, added:
The government has shown a total lack of respect for the budget process by reneging on its commitment to provide future tax reductions for all businesses.
Garth Whyte of the Canadian Federation of Independent Business has also slammed the legislation and the way the Liberals are managing our finances. In his open letter to the Prime Minister, Mr. Whyte wrote:
Elimination of the corporate tax cuts would be a slap in the face to all small- and medium-sized enterprise (SME) owners who create most of the new jobs in every community across Canada. Prior to last year’s federal election, both the Liberal and NDP parties expressed support for creating a fair taxation system for small businesses in recognition of the important role it plays in economic growth and job creation.
We believe that these tax measures are far too important to be used as political bargaining chips for political purposes. That is precisely what the Liberal-NDP bill does.
As a young Canadian representing one of the youngest ridings in the country, and one of the fastest growing areas of Canada, the budget is of great concern to me, in particular the growth of program spending over the past few years. Federal program spending is estimated to reach $163.7 billion this year. Just two years ago program spending was $141 billion. That is an increase of 15.8% in just two years, which far outpaces the growth of our economy and our population, according to economists.
What makes the growth in spending really problematic for me as a British Columbian is that it is being steered by the NDP. As a British Columbian, I have seen and experienced first hand the realities of NDP fiscal and economic policies and I can report to the House, and to all Canadians, that NDP economic policies are something we should always shy away from. Actually, we should run away from.
In British Columbia on the NDP watch, the uncontrolled tax and spend approach was disastrous for my province. In the decade from 1991 to its defeat in 2001, the NDP imposed $2 billion worth of new taxes on everything from personal to corporate income. Fees and taxes grew 50% faster than the pre-tax incomes of British Columbians. If we think that a $2 billion tax increase is hefty, it was eclipsed by a $5 billion spending increase in just five years between 1992 and 1997 and as a consequence the B.C. NDP ran eight consecutive budget deficits and in the process doubled B.C.'s debt.
As a result of that uncontrolled tax and spend philosophy, taxes were raised, spending was dramatically increased, deficits were run, and new debt was incurred. Worse, the bonding rating agencies that rate the credit of companies and governments were shocked by the reckless management style and reacted by downgrading B.C.'s credit rating which in turn raised the amount of interest B.C. had to pay on its rapidly growing debt.
The ongoing result of a disastrous NDP decade is that B.C. today has to spend roughly $2.6 billion a year on interest on the provincial debt. This is a problem because if we have to spend $2.6 billion a year on interest, it is $2.6 billion that can not go toward other priorities and programs for Canadians and for British Columbians.
In the case of B.C., that $2.6 billion a year works out to $672 for every man, woman and child in my province or nearly $1,700 a year for every B.C. family. In other words, the ongoing cost of just 10 years of NDP economics is a $1,700 annual tax for every B.C. family. I am raising this provincial example of the impact of NDP economics in British Columbia to this federal House because I am hoping that there are some Liberal members who do care about fiscal responsibility, as they bragged about in the last election campaign. Consider the facts of the NDP economics and consider the facts of the NDP partnership with which they are getting in bed.
In British Columbia the NDP introduced five separate fiscal management plans. Not one targeted outline was ever met. In nearly every category, deficits, debt management and spending, the NDP missed its promises every year in terms of targets. It introduced eight consecutive budget deficits, including two fudge-it budgets where it misled the public. The NDP took British Columbia from a have to a have not province during the nineties, a decade of robust economic growth across North America. The NDP doubled taxpayer supported debt in less than a decade. B.C.'s debt to GDP ratio increased dramatically by 20% in less than a decade. The NDP left B.C. with the highest personal income taxes in Canada. Fees, royalties and taxes had increased one and a half times faster than British Columbia's pre-tax incomes.
In the 1992 to 1999 period, the government increased spending from $17 billion to $22.2 billion, over a 30% increase. Spending increased faster than the ability to pay for programs. Under the NDP, B.C. had two credit rating downgrades, the worst fiscal record in Canada during the 1990s.
My constituents do not want to face the same disastrous NDP economics here in Ottawa. The budget is a missed opportunity and at every step of the way, the Conservative Party, the official opposition, has stood up and said “no” to the tax and spending priorities of the Liberals, “no” to the tax and spend priorities of the NDP. We will continue to fight this fight in the House, at committee and through the coming election campaign in the spring, which the Prime Minister has called.
We believe in lower taxes, less government and more freedom. We believe in personal responsibility and democratic reform. We believe in ensuring that Canadians have more money in their pockets so they can choose how they want to live their lives rather than having more money in the hands of Liberals and a $4.6 billion slush fund that it can throw money around, prior to an election campaign being started, for their own political purposes.
We believe in empowering families and putting money back into the hands of individuals so people have choice in how they live their lives and taking away the power of cabinet to politically manipulate a budget so it can buy votes in the House and then buy votes in the next election campaign, having no regard for the future economic health of our country.
We will be voting against this budget proudly. When the new Conservative government is formed, we will bring this country back to some sane fiscal management.