Debates of Oct. 26th, 2006

Budget Implementation Act, 2006, No. 2

[Pierre Paquette, Bloc, Joliette, QC]

Marcel Gagnon. I can mention his name because he is no longer a member here. He really sounded the alarm about the fact that thousands, if not hundreds of thousands, of older people were not receiving the guaranteed income supplement and that the federal government was dragging its feet in promoting awareness of this program. Several thousands of them were able to correct the situation, but there are still tens of thousands of people who have not been informed of their rights.

For our part, we would have preferred that this measure be accompanied by a real campaign to make this program known to older people who are entitled to the benefit. At the same time, we would have liked to have seen a retroactivity rule so that those people who had not received the supplement because they did not know about it could obtain the payments of which they had been deprived. Once again, these people have had to face the bureaucratic indifference of the federal government.

Still dealing with individuals, they have created a non-refundable $1,000 tax credit for employment income. For 2006, the amount will be $250; it will be increased to $1,000 for 2007. A non-refundable public transit tax credit has also been established. I spoke about that previously, and I will refer to it again later because this is an extremely important measure in the campaign against greenhouse gases.

The Bloc Québécois would have preferred a refundable tax credit, because we know that people who use public transit—not all of them, but many—do not have their own cars, have low incomes and therefore do not pay taxes. This is a first step, but we should improve this measure in a future budget by making the tax credit refundable.

A tax credit has also been introduced for textbooks, as I mentioned. This credit will be up to $65 a month for full-time students and $20 a month for part-time students. Considering the cost of textbooks, I think everyone will agree that this is an extremely beneficial measure for students. It will also help to reduce student debt—though obviously not as much as might be liked.

All in all, this is a positive measure and in the future, other measures should be added, in order to improve the situation of students, who, particularly in the Canadian provinces, may incur a lot of debt. As we know, Quebec has a system of loans and bursaries needing improvement, because the government in place, led by Mr. Charest, skewed it by transferring to loans a whole series of items formerly covered by bursaries. Some corrections will be made in this respect, I am sure, once the Parti québécois resumes power in the coming months.

And that goes for student debt, too. Very clearly a substantial transfer for social programs and post-secondary education will be required in the next budget. The Bloc Québécois imposed this condition, prior to lending its support for the upcoming budget.

With the Standing Committee on Finance, I have been able to travel all across Canada. Yesterday we were in Quebec City. Everyone acknowledges that a transfer of $4.9 billion is needed, including $1.2 billion for Quebec and some $550 million for universities and CEGEPs in this province. This measure is aimed at individuals, but it does not deal with the whole problem of student debt.

Another measure consists of raising from $767 to $1,000 the refundable supplement tied to medical expenses; this was simply indexed. This measure, aimed at people who need special care is positive, all in all. Let us hope, though, that it is not a way of fostering development of the private sector, which already plays a large part in our health system.

As I said earlier, these are the provisions that affect individuals. We feel that the most important of these elements are the tax credits for public transit, textbooks and tools. The Bloc Québécois made all of these suggestions in the past in private members' bills that we introduced but that were never passed. I would emphasize that these are only first attempts that ought to be improved upon in coming budgets.

I mentioned the tax credit for public transit. We must also ensure that tradespeople can benefit from a $1,000 deduction for expenses related to tools. In some trades, tools must be upgraded regularly because of changing technology. Lastly, with respect to the tax credit for textbooks, we think it would be logical for the federal government to abolish the GST on books, which are a cultural product that must be as accessible as possible.

Because of the positive elements in this first area, the Bloc Québécois will support Bill C-28.

With respect to businesses, specifically fishing businesses, as I said before, the Bloc Québécois has always supported Quebec fishers. We are keenly aware that the number of new people going to work in the fisheries sector is dwindling, just as it is in agriculture. This problem will get worse over the coming years. The fishing industry is vital to the survival of several of our regions, especially in coastal areas. The government's proposed measure encourages the intergenerational transfer of fishing businesses. We will support it. However, we will continue to demand greater tax benefits for the transfer of agricultural and fishing businesses to individuals outside the family.

Of course the emphasis should be on transfers within the family, but, as we all know, children of farmers and fishers may very well opt not to follow in their parents' footsteps.

There should also be tax credits for businesses that are transferred outside the family circle in order to keep them going. This is important for the economic vitality of our regions and the occupancy of the land, which is a consideration that deserves greater attention.

It would not make any sense to allow regions to empty out even though they have good potential for economic development if just given a little help to do what needs to be done. It would not make any sense to empty out these regions only to discover that social costs in the large urban centres are going through the roof because of the ensuing rural exodus. We should attend, therefore, to the occupancy of the land, and this is a measure that does so. As I was saying, though, it should be expanded.

Finally, food security is very important to Quebec. Quebec is virtually autonomous in regard to food. Some crops, of course, do not grow very well in Quebec, for example oranges. However, enormous progress has been made with products that can be adapted to the Quebec climate.

For example, in my riding of Joliette, we used to have a flourishing tobacco industry. The reduction in tobacco use—obviously a good thing—and the decisions made by multinational corporations to purchase more from emerging countries like Brazil and China have resulted in nothing less than the closure of this industry over the space of only a few years. Of the 56 farms that existed in 2000, only three still produce tobacco. The others had to be converted to other crops.

The federal government created a $12 million conversion assistance program for Quebec. This is a step in the right direction, but it is not enough. When farmers change to a new kind of crop—for example melons, Chinese cabbage, asparagus or cauliflower—they are not always successful because their land is not necessarily suitable or because certain crops are very difficult.

There may be a period of trial and error therefore. I want to take advantage of this opportunity to say that our tobacco producers in Quebec—although it is true of Ontario as well—need more assistance in converting their land because we do not want to lose these agricultural areas.

As for corporate taxation, I will focus mainly on small and medium sized businesses, because, as I mentioned earlier, they have become, in a sense, the victims of the fiscal imbalance and inequity. We would therefore fully support an increase in the sales figure that would allow small and medium sized businesses to have access to a lower tax rate.

Our 2000 election platform included the following demand:

Corporate taxation should be reformed to ease the tax burden of small and medium-sized companies to help them become more competitive on international markets.

That is exactly what we stated in our party platform in 2000.

Small and medium sized businesses, by their very nature, are often the starting point for new ideas. They are also better adapted to the reality of the regions. Consider the following example.

We know that businesses in the softwood lumber industry are growing larger and larger in terms of production volumes. This is true in western Canada and the United States, and in emerging countries and the Scandinavian countries. Quebec has focused on development in which the regions have their place within the chain, but the only way to guarantee their competitiveness is by ensuring that smaller sawmills have a certain specialty and orders that cannot be filled by the larger businesses. This will therefore require a great deal of work in research and development.

Furthermore, we would have liked to see the government add a surtax on oil industry profits in Bill C-28. Yesterday, we began to see some results. Sky-high profits were taken straight from consumers' pockets because of the absence of competition in this sector.

As a final point, we also called for a reduction in the excise tax on volumes of beer brewed under 75,000 hectolitres. This would allow these businesses to remain competitive within the domestic market and to think about developing external markets.

Accordingly, for all these reasons, and despite the shortcomings I mentioned, the Bloc Québécois will support Bill C-28.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Mr. Speaker, I rise on a point of order. As you know, earlier this morning I had the pleasure of addressing Bill C-28 in the House. I have reviewed the bleues and I noted that as I was speaking to Bill C-28 I mentioned that our tax initiatives regarding seniors would remove 85,000 pensioners from the tax rolls.

I was then asked a question by the hon. member for Yukon and inadvertently responded that it would remove 850,000 pensioners from the tax rolls. I would like to correct the record as it pertains to my response in that our tax measures for seniors and pensioners will remove 85,000 pensioners from the tax roll.

[The Deputy Speaker, NDP, Bill Blaikie]

I thank the hon. member for his point of order. I thought he was rising on questions and comments but we will take it as the point of order that was intended.

We will now proceed to questions and comments. The hon. member for Winnipeg Centre.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, the point I would like to make is that minority Parliaments usually offer good opportunities for opposition parties in that we actually have the balance of power. In fact, we could have effected meaningful change to the 2006 budget if the Bloc Québécois had not walked outside. The leader of the Bloc Québécois walked out of the chamber five minutes after the budget was tabled and said, “I like it, we will take it, it sounds good”. At that very moment all negotiations ceased. There was no longer any opportunity for the three opposition parties to collaborate and make this budget better because the ruling party had its partner. All it needed was one dance partner and it had it within five minutes.

My colleague is a trade unionist. He comes from a trade union background, as do I. Both of us have probably negotiated dozens of collective agreements in the trade union sector. Will he not accept that it is a bad negotiating strategy to give up in the first five minutes of a negotiation and say, “Whatever you offer, I will take it”, even though it is completely deficient in this area, that area and the other area, all for a pig in a poke, all for a promise that fiscal equalization will in fact be addressed? My mind reels at the lost opportunities.

I will ask the member about one specific example. He knows full well, as he and I have harped on this in the past, that the government loses $7 billion a year to tax havens, tax motivated expatriation, sleazy, tax cheating loopholes. Tax fugitives from Canada hide their assets offshore so they can avoid paying taxes in Canada. It is an atrocious thing.

In this budget the finance minister could have terminated or torn up the remaining tax treaty in this country and put $7 billion of revenue back in the coffers of Canada that he could have perhaps used to deal with the fiscal imbalance, but, no. We lost the opportunity to even raise that as an amendment. We could have amended this budget to make it a damn good budget written by the opposition parties and the Bloc decided to sell us out by walking out the door and accepting it at the very first opportunity.

[Pierre Paquette, Bloc, Joliette, QC]

Mr. Speaker, I thank the hon. member for his comment. It gives me the opportunity to remind the House that everyone voted in favour of the budget bill. As I recall, when the Chair asked if anyone wanted to put the question, no one, even on the side of the Liberals and New Democrats, rose to do so. We have all voted in favour of this bill, unless the hon. member can tell me otherwise, saying that they had a moment of inattention and forgot to rise to put the question, but I do not think so.

The people from the NDP, like those from the Liberal Party, are intelligent people. I believe it was a deliberate move to prevent an election from being called. An election call would be no problem for us. In Quebec, the polls are looking very good right now for the Bloc Québécois, with over 44% support. The Bloc would be winning back seats it has lost in the Quebec City area.

We negotiated with the Conservatives. Perhaps our priorities are not the same as those of the NDP or the Liberals. Two Conservative government promises were important to us in the budget. First, the fiscal imbalance has to be addressed by the next budget. We want to know what steps will be taken to solve this problem--which has been acknowledged by the Conservative government—the timetable for arriving at a solution, and the extent to which the fiscal imbalance will be corrected. I can assure my colleague that, if this is not in the next budget, the Bloc Québécois will vote against the budget. We are not afraid of an election. It would not have bothered us if one had been called this past fall because of the Kyoto protocol. I hope my colleague is of the same opinion.

We have negotiated resolution of the fiscal imbalance and an assistance program for older workers. The assistance program for older workers introduced by the Conservative government does not meet our expectations. However, we obtained a commitment at least insofar as the budget is concerned. I remember that this was negotiated in advance. Since the leader of the Bloc Québécois had obtained what he had asked for from the government and the Prime Minister, five minutes later he was able to say that the budget was satisfactory.

The member knows quite well that it is impossible to amend a budget. The proof is that the NDP, to support the Liberal's budget, negotiated another budget, Bill C-48. They did not change or amend the first bill regarding the budget tabled by the Liberals, but they voted in favour of it when the budget was presented, even when the Liberal Party had lost all credibility in the eyes of the public in Quebec and Canada as a result of the sponsorship scandal.

I feel that the Bloc Québécois made responsible decisions; it will do so in the future. I can assure the member that the Bloc Québécois will conduct tough negotiations with the Conservative government. If the results of these negotiations are not what we believe to be in the interest of Quebeckers, we will vote against the next budget.

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, I often think that we should be debating not only what was in the budget but also what was not in the budget. I think the member will agree that in the throne speech the number five priority of the minority Conservative government was to bring in wait time guarantees. Just to remind all hon. members, that undertaking was basically that should the wait time benchmarks not be met, the health care system would transport patients to other provinces or even to the United States to get those services to meet those wait times.

The budget does not include any new moneys for the wait times guarantee, zero. The latest reports in the media today are that the wait times in the other non-priority areas actually have increased while the resources from the health care system without additional money have gone to the five priority areas that were agreed upon with the provinces.

I wonder if the member would care to comment on whether or not the minority Conservative government has not only not delivered on that promise but in fact has provided absolutely no undertaking to assure Canadians that this really is a priority of the government.

[Pierre Paquette, Bloc, Joliette, QC]

Mr. Speaker, I thank the member for his question. This all goes back to the fiscal imbalance. If you have read the same reports I have, you will have seen that the provinces whose wait times have increased are the ones experiencing the greatest financial difficulty. Alberta and Ontario are doing relatively well. Quebec and the maritime provinces are having more difficulty.

The answer to his question is putting the necessary cash into correcting the fiscal imbalance. This would enable Quebec and the Atlantic provinces to fix their problem areas. When we do not have any money, we cannot just print it, as Réal Caouette and the Social Credit Party suggested years ago. This problem is very real.

The federal government must correct the fiscal imbalance in its next budget to the tune of the figures I have already mentioned: $3.9 billion for Quebec, a large part of which would go to health care, as well as to post-secondary education, fighting poverty, and the Government of Quebec's other responsibilities, such as infrastructure and culture.

To correct this problem, we do not want the federal government to interfere in provincial areas of jurisdiction and in Quebec's affairs. We want it to acknowledge its financial responsibility by transferring the money and correcting the fiscal imbalance. Then we will see whether the provinces can meet the needs of their people. They will always be accountable to their people, not to the federal government.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Speaker, why are the hon. member and the Bloc walking away from Quebec children by agreeing with this budget which clearly is taking about $800 million from the early childhood education agreement with Quebec? That was what was due. I have heard the leader of the Bloc say in this House that $800 million was needed. That was the agreement. By supporting this budget in fact the Bloc is walking away from the $800 million that was originally agreed to.

We know that a lot of Canadians care about making poverty history. Just this week over 5,000 Canadians made submissions to the Minister of Finance saying that we must deal with child poverty in Canada and child poverty elsewhere. There are 23 million people around the world who took action by standing up against poverty. In Canada alone, 50,000 Canadians want real action on poverty.

In this budget, there is really very little on foreign aid. There is very little on the child development fund. That $800 million is now no longer there because of this budget. How could the Bloc party agree to this kind of budget?

[Pierre Paquette, Bloc, Joliette, QC]

Mr. Speaker, as I said earlier, we had set out a number of conditions which the Conservatives have met in tabling the budget. It is somewhat similar to the situation where the New Democratic Party voted in favour of the Liberals' main estimates before the election. There was nothing in that budget to improve the plight of children or to correct the fiscal imbalance. It is true that the NDP also got Bill C-48, which provided for social housing and transfers for education. But at the time when the NDP voted in favour of the main estimates, the budget it voted for contained no social elements.

We had set the following condition: for us to vote in favour of the last budget, the subsequent one would have to correct the problem of fiscal imbalance once and for all. That would help children in Quebec and across Canada. Out of the $3.9 billion requested, $285 million would be earmarked to remedy the Conservative government's decision to renege on the $800 million deal for child care. So, that is included. Another condition was correcting equalization as a means to combat poverty in general and child poverty in particular.

I will conclude by saying that reforming the EI program so that it really provides an adequate social safety net is something else that can be done to remedy child poverty. The Bloc Québécois cannot be said to have been dragging its feet on that issue.

[Shawn Murphy, Liberal, Charlottetown, PE]

Mr. Speaker, I rise today to participate in the debate on Bill C-28. I will confine my remarks during the early minutes in my limited time on the $1 billion in cuts that were made mainly to social programming here in Canada that were all part and parcel of the budget.

Most Canadians share my view that these cuts were directed at the most vulnerable people, groups and organizations in Canada, and the most vulnerable regions in this country. The cuts were based very much on ideology. Today's editorial in the Vancouver Sun accurately describes the nature of these cuts and the direction of the minority Conservative government. In actual fact, Barbara Yaffe introduced a new term into the lexicon of this assembly. I agree with her proposition that the government is suffering from a rare disorder called “ideology restrictus”. That is the problem here and I am not sure there is a known cure for ideology restrictus.

I agree with the thesis of the article that normally, when a minority government is elected, it is elected on a certain base. Once it gets into power, it attempts to broaden that base and reach out to other groups, individuals, organizations, so that the government can be the government of all Canadians in all regions of the country. With this particular minority Conservative government, that in fact did not happen. In fact, it is becoming narrower and narrower.

The Conservatives are narrow casting to their own group. Canadians have seen that very clearly from the $1 billion in cuts to social programs that were recently announced by the minority government. I want to speak about these cuts and how they affect these groups, individuals and organizations in this country and how devastating and cruel these cuts will be and the very unpleasant effects that will result. Before I do that, I want to put the cuts into context.

I agree that sometimes a government has to reorganize its priorities. There are certain times when tough decisions have to be made. Simply because a program was funded 10 years ago does not necessarily mean that the program has to be funded in perpetuity. I agree with that. A government should on a daily basis be looking at and prioritizing its agenda, programs and initiatives. However, I want to put this into context because it is very important.

In 1993 when the Conservative government under prime minister Mulroney lost after nine years in office, this country was in devastating financial circumstances. Interest rates were close to 12%. Unemployment was in excess of 11%. The annual deficit of Canada was $43.1 billion, and I said billion, not million. The debt to GDP ratio was at 73%, its highest level ever. Unemployment was increasing. The World Bank had basically given up on this country. I believe that Canada was headed for bankruptcy.

In that case there were some tough decisions. There were cutbacks that were necessary. Through good government and with the necessary control of the fiscal monetary levers available to the government, Canada's success has been startling. We all know the results.

Canada has had eight consecutive surpluses. Interest rates are at an all time low. Three million jobs have been created over the last five or six years. Whatever context we want to use, whatever we want to compare it to, whether it is debt to GDP ratio, jobs created, interest rates, et cetera, the country, when compared to the G-8 or any other countries in the OECD, has been ranked one, two or three and it has certainly been very successful.

That was the context back in 1993. In 2006 when this Conservative minority government came it power, it inherited a surplus of $13.2 billion. That was just a little contextual background leading up to these devastating cuts that were made to certain vulnerable Canadians and announced last month.

The first one I want to talk about, in the whole scheme of our $210 billion budget, perhaps does not amount to a significant amount of money, I found very cruel and devastating. It is the $5 million cut to the budget of the Status of Women. Coupled with that was the pronouncement of the government that it would no longer consider any applications for funding to any women's groups that advocated equality. In my riding, and I believe the riding of every member from across Canada, it will have a devastating effect because that is what a lot of these groups do, and they do it successfully. Their job is not done.

I want to quote from a release from Kirstin Lund who is the chairperson of the Prince Edward Island Advisory Council on the Status of Women. She says:

If Canadian women are equal, how is that they made just 62% of men's incomes in 2003, even though they made up 47% of the workforce? If Canadian women are equal, why is it that 43% of all children living in poverty live with a single mother? If Canadian women are equal why are there over six times as many female victims of sexual assault as male victims? Why are female victims of spousal violence more than three times as likely than male victims to fear for their lives? And why do women make up 84% of all victims of spousal homicide?

This question has been asked of the Minister of Canadian Heritage in the House a number of times and people are very upset. This group is upset. Groups right across Canada in all 308 ridings are very upset. The answer I have heard over and over again from the minister was that the government considers women to be equal and it was not necessary. Again, I find that totally unsatisfactory. I do hope that as we go forward this particular cut, more important, this particular restriction, will be lifted and we can go back to the way it was funded in the past.

The second area I want to talk about goes back to my original premise that these cuts are focused. It is like a rifle. They are targeted at certain groups. They are targeted at the illiterate, women, aboriginals, youth, poor people and environmentalists, as well as certain groups within society that this particular minority government, for one reason or another, just does not like and does not feel that it represents.

The second cut that was announced by the finance minister was the $17.7 million from the budget under the literacy skills program. As everyone in the House and most Canadians are aware, this is a very serious issue. Most studies indicate that over 30% of all adults have certain literacy and numeracy deficiencies and until some form of remedial action is taken, they cannot participate in the knowledge economy. In the province I come from, Prince Edward Island, under this program the provincial government received approximately $325,000 of annual funding for a literacy program. There was another voluntary alliance, the Prince Edward Island Literacy Alliance, which received approximately $100,000.

It was not a great amount of money, but it was to be used to coordinate a lot of volunteer organizations that were working in the communities each and every day dealing with this literacy issue. They were doing very good work. That is gone now. This money was leveraged to the volunteer sector and the government's response was that the sector was not doing its job and was not successful. The government needs to tell that to the groups and volunteers who were involved and to the people who benefited from those programs.

I want to quote from the executive director of the Prince Edward Island Literacy Alliance, Catherine O'Bryan, who said:

Why isn’t our government concerned with the betterment of all Canadians? This cut comes at a great expense to the very people who struggle to participate fully in the community--the message from this federal government is clear: People with low literacy skills don’t matter.

I would like to quote a statement in the Globe and Mail of October 5 made by the President of the Treasury Board in response to those people who have friends and relatives who have some degree of literacy problem and are concerned about these groups, individuals and organizations. He said:

I think if we're spending $20 million and we have one out of seven folks in the country that are functionally illiterate, we've got to fix the ground-floor problem and not be trying to do repair work after the fact.

That was a quote from the government. That was the response to those groups, individuals and organizations that are so concerned about this important problem.

Another cut was made which I do not believe has sunk in yet. It is going to affect the tourism industry which has been struggling over the last couple of years. A whole host of factors have been working against it: the price of gas has gone up, the Canadian dollar has risen significantly over the past six or seven years, security issues restrict a certain number of visitors crossing the border into Canada, and the lack of international marketing.

A whole ménage of factors have driven down the number of tourists, especially international tourists. I am talking about the $78 million cut from the visitor GST rebate program. This program allowed international visitors to get a rebate on the GST they paid on goods purchased here in Canada. This is going to make us much less competitive on an international basis.

Two particularly important segments of this industry that are going to be affected are the bus tour business and the international convention business because this rebate is built right into their budgets. If a bus tour is coming up from New York City and it is going to spend seven days touring Quebec, Atlantic Canada, and Ontario, the GST rebate is built into its budget. When it loses that rebate, that basically makes our product 6% less competitive than it was before this cutback was announced.

It is my position that this cut was not well thought out. The Canadian Tourism Commission, all the provincial industries, and all the tourism groups, are dead against this cut. I do not think this was actually thought out and it is going to make us less competitive. This is just one more nail in the industry's coffin.

I understand the finance committee has voted to review this particular cut because it is very concerned about it too. I hope that after the finance committee has done a thorough review on the issue and hears from members of our tourist industry from all provinces, the government will reconsider this particular cut.

Another cut that was made and I do not know why this was made, it was a small amount of money, but there was a cut made to the museums assistance program. It was not big bucks but this small amount of money was leveraged through the volunteer sector and a lot was accomplished with a very few dollars.

In my province seven museums received between $20,000 and $24,000. From a Government of Canada context, that is not a lot of money. However, they were able to take this money and most museums were also able to access one student under the youth employment strategy which I am going to speak about in a few minutes because that was another cut we have seen.

They were able to leverage those two programs and keep open their very small community museum. It is not a lot of money, but the effects of the cut will be devastating on these seven communities that had community museums. Hopefully, they will continue to open, but it is going to be a real struggle. We, representing all Canadians, have to ask the question and that is, why? Silence. Why would the government do it?

The court challenges program was ideologically based. This was a program that allowed certain groups and organizations to challenge a particular law, especially with the enactment of the Canadian Charter of Rights and Freedoms. We did not have any judicial interpretations, how it would be interpreted by our courts. There were certain groups and organizations that took advantage of it. It changed certain laws. It changed the way it responded.

An example from the east coast of Canada was the whole Marshall initiative dealing with native rights in the fishery. A lot of the Acadian groups made certain challenges to determine what was their right under the Canadian Charter of Rights and Freedoms to access schooling for their children, what cluster had to reached and what criteria had to be formed. This was tremendous for these groups and organizations, but again, that is gone, out the window totally.

The youth employment strategy was also cut. Again this was a small program that communities, groups, and non-governmental organizations were allowed to access and that they could lever. Every member of Parliament is fully aware of this program. Probably 70 or 80 students from each riding on average were able to access the youth employment strategy. It was a very low budget program.

If it were a non-governmental organization like a community museum, like the Canadian Cancer Society, or the heart foundation, they would be able to access students, not for the full summer but I believe the maximum was 8 weeks or 12 weeks. They were only paid a limited amount of money, around $7.50 an hour and an NGO would get 100% financing and private enterprise would get 50% financing. There has been a 60% cut in that program.

Again, I just have to shake my head. I ask why, what are we doing here? We had a $13.2 billion surplus. In most instances this was a young student's first entry into the workforce. It was so important for these young people and again, for no reason, just thrown out the door and everyone here is shaking their head.

There were other programs like the Canadian volunteer initiative. When we look at all these cuts, they were made to the most vulnerable people living in Canada. What scares me the most is that the finance minister announced there are another billion dollars of cuts coming next year. There have been accusations over the past that the Prime Minister has a hidden agenda. I disagree with that proposition. The agenda is clear, the agenda is obvious, and the agenda is very disturbing.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I represent the riding of Winnipeg Centre, which was formerly represented by Stanley Knowles, a man who many concede to be the architect and the father of our old age security system and guaranteed income system.

I can only say that, given what my colleague has told us today and what my own research shows, Stanley Knowles must be doing flip-flops in his grave to take note that after nine years of budgetary surpluses and now, after a huge budgetary surplus by the present government, old age pensioners, especially low income old age pensioners, will actually get a cut in pay.

Has my colleague come across the same research that I have found? I will read from Revenue Canada's basic personal exemption page. It says that the basic personal amount deduction will be reduced on July 1, 2006, from $9,039 to $8,639. That is not a reduction in taxes or a tax cut. That is reducing the basic personal exemption, which means that those seniors will be paying taxes on more of their meagre incomes at a rate of 15.25%, which is also a tax increase. It used to be 15% flat and now it is 15.25%. That tells me that seniors will be paying $61 a year more in taxes than they were before.

Does my colleague concur with this? Could he also explain how, in all good conscience, low income pensioners should actually get a cut in pay in an era of record surpluses?

[Shawn Murphy, Liberal, Charlottetown, PE]

Mr. Speaker, I suggest that many people would be spinning in their graves if they could see what has gone on in this assembly over the last year and a half.

As the member across is aware, when the previous government was in power it presented, I thought, a good budget to the House with the very strong input of and consultation with the New Democratic Party. We had the Kelowna accord, which was being financed, and that was the work of all 10 provinces, every aboriginal group and the federal government. We had the Kyoto accord and we had tax cuts, especially for low income people.

Canadians would have had the advantage of all those programs but something happened along the way. The New Democratic Party supported a motion to defeat the government which sent us into an election. We all know what happened to the Kyoto accord after the election? It was gone. What happened to the Kelowna accord? The tax cuts were reversed. That was the day the New Democratic Party lost its soul.

A lot of people would be spinning in their graves if they knew what the learned member and his colleagues did that day. It was an unfortunate day for lower income Canadians and for all Canadians.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I will not take the bait. I will not even bother correcting my colleague. It was the people of Canada who threw out the Liberal government, not the New Democratic Party. I will simply go to a question of some substance.

Would the member agree that it is morally and ethically reprehensible to allow Canadian companies to set up offshore tax havens to avoid, through wholesale tax avoidance, paying their fair share of taxes in this country?

In the context of this budget, why did his party and his government put up with this year after year, where tax fugitives can set up dummy companies in Barbados to avoid paying their fair share of taxes in Canada? By what pretzel logic did his party think that was good for ordinary Canadians or low income Canadians who may have been able to redistribute that $7 billion into meaningful programs? Could it be that it was his own prime minister that was one of the main beneficiaries of this outrageous, sleazy tax loophole of offshore tax havens? Why did his government tolerate that? Why did it not fix it when it had the chance?

[Shawn Murphy, Liberal, Charlottetown, PE]

Mr. Speaker, the member has raised this issue on numerous occasions in the House and I actually do not believe he understands the Canadian tax system.

However, the member is quite right. If a Canadian company or an individual is avoiding taxes on income earned in this country by any means, it is reprehensible. However, the way the tax system works is that people pay their taxes in the jurisdiction where the income is earned. If Bombardier has a plant in Northern Ireland, it pays on the income earned at that particular plant in Northern Ireland. Most countries have tax treaties so companies can deduct that, but that is how the system works.

However, people do not avoid taxes. If income is earned in Canada then the company or the individual is obliged under our law to pay the tax in this country. If they have an operation in Singapore, Northern Ireland, Great Britain, Scotland or the United States, they must, under the laws of those countries, pay the tax in that particular jurisdiction, all subject, of course, to the tax treaties between the respective jurisdictions.

[Robert Thibault, Liberal, West Nova, NS]

Mr. Speaker, the member from Charlottetown hails from a very historic and important part of this world. Charlottetown has the great distinction of being only about four hours drive away from western Nova Scotia. It is, like all of Atlantic Canada, very proud of its history. We have thousands of volunteers working to ensure we preserve our culture and history.

Atlantic Canada has many small museums, places around which people are able to exercise that function and they volunteer countless hours, but they need assistance and that assistance often comes in multiple ways. One is that students get great experience by working in those facilities when they are in university, right after high school. They are able to work in the summer to assist the communities, assist the volunteers and get the work experience needed to ensure they have a successful future and a good career in the work life after university.

These museums need assistance from senior levels of government in their operating and capital funding. They were pleased when they received a letter from the Leader of the Opposition then and Prime Minister now that there would be additional federal investments. Instead, they see themselves being hit twice and hit very hard. First is that the federal government, rather than increase the funding levels to museums, it reduced it. That was in the first round of cuts. Where will the second go? We do not know.

Second, we saw this past summer that there were a lot fewer student employment jobs and we have seen the budgets cut further. They know they can look forward to a lot less assistance in the future, both from the students and the volunteer organizations.

Would the member from Charlottetown like to comment on those points?

[Shawn Murphy, Liberal, Charlottetown, PE]

Mr. Speaker, I will comment on those points because they are important. I did explain it briefly before but I will elaborate.

The member is quite correct. Many small communities right across Canada with populations of 1,000 or 1,200 do have small museums. They are often small museums that perhaps talk about the history and the artifacts of the given communities. These communities do not need big budgets to operate the museums. They are operated on a shoe string budget, basically by a volunteer board and volunteer members, but they were able, fortunately, to leverage some federal financing.

I am aware of seven museums in Prince Edward Island that received around $20,000 in total, which is not big dollars. Many of them accessed the youth employment strategy where they could hire a student for the summer months. In some cases the museum was only open during the summer months. The student was paid $7.50 an hour and everything worked. It was not a lucrative job but it was a good job. The students met visitors and the community had pride in the museum.

The limited funding was accessed but, as the member pointed out, the assistance program has been slashed and the youth employment strategy has been slashed by 60%. It will be very difficult for the small museums to operate in the future, which is very unfortunate.

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, I will be splitting my time with the member for Hamilton East—Stoney Creek.

With the fiscal capacity that the government has, the budget was an opportunity to invest. It was also a time to invest because, of course, for 13 years we experienced the rather penurious actions of the previous Liberal government toward the people of Canada. While it reduced the fiscal deficit, it increased the human deficit in Canada.

Toward the end of their time, the Liberals softened, but not completely. I know that in 2005 the New Democratic Party had to fight very hard in that budget to ensure the Liberals did not get away with another tax cut for corporations and that they invested that money in people. That was very good and that is working.

Even within this budget and within Parliament today, the two parties of the right, because that is what they really are, are living off the good avails of the New Democratic Party and the work that it did in 2005. They are dining out on it. We do not want to forsake them of a good meal but they should remember who the cooks were.

In this budget, instead of investing more in the needs of Canadians, the Conservative government decided to squander another $7 billion in corporate tax cuts and to keep the subsidies to oil and gas companies. Even with that, it is currently running a bigger budget surplus than the Liberals did.

Just into this fiscal year, it is $2 billion ahead of its estimates. What did it turn around and do? It announced a billion dollars in cuts to programs that were in place all over the country, this little bit of money that was handed out under the Liberals in a variety of very serious areas, such as literacy, women, museums and health. The Conservatives must have sat in their caucuses and decided on how many programs they could cut a few dollars from and make them work even less than the Liberals did.

I want to talk about the tobacco control program that was cut for aboriginal people. In the Northwest Territories, prior to 2000 we had a smoking rate of 45% in our population. Over the last four years we have managed to bring that down to less 35%. That is a direct and positive result of our Government of the Northwest Territories putting money into it. The federal government also put money into the program because, of course, half our population is aboriginal.

We had the very successful butthead program in the schools which discouraged every child from taking up cigarette smoking. That is gone now. There was no consultation and no recognition of the importance of these programs. I am sure the territorial government will try to do something to replace it, but that is a loss.

The sale of tobacco in Canada contributes $8.8 billion in taxes to federal, provincial and territorial governments. It is very important that we reinvest in the opportunities to reduce tobacco use. Just because we are on the dole with tobacco taxes does not mean that we should ignore our responsibility.

I now want to talk about the corporate tax cuts that the Conservatives have proposed.

Across the country, corporate taxes in provincial hands have been spiralling downward. Provinces have to compete with each other for corporations to establish offices in their jurisdictions and pay their corporate taxes in those jurisdictions. The provinces are in a race to provide the lowest corporate tax rate to attract the companies to do this. Private individuals, of course, cannot afford to relocate just simply to get a lower personal income tax rate, but corporations can manage this quite well.

The responsibility for an across the board corporate tax rate lies with the federal government. In reality the federal government is the best agency to collect corporate taxes and should be the agency to collect those taxes, but over the time of the Liberals and the Conservatives, we have seen this denigrated to such a great degree.

We see the Conservative budget as crafted to meet the needs of the oil patch, not working Canadians. There are a few crumbs for working Canadians and everyone appreciates those. However, it is only a sleight of hand to take attention away from the billions in tax giveaways to big corporations, particularly oil companies, making obscene profits on the backs of hard-working Canadians and on the backs of our grandchildren as well, who will not have the share of the non-renewable resources that we are giving up now.

In the natural resources committee meeting earlier this week, we had presentations from CERI, the Canadian Energy Research Institute, which indicated that by 2020, if the expansion of the oil sands has taken place as outlined and if the cost of oil is $40 U.S. a barrel, which is $62 today, oil companies will make approximately $1 trillion by 2020 from the oil sands, on an investment of $100 billion.

The government's share of this will be less than 15%. We will see the escape of enormous amounts of resources and dollars out of our country and out of the hands of Canadians who need them so much. We need a government and a budget that speaks to the future of our natural resources, and that is quite clearly the case.

Another study was done recently in my territory by an independent group on the Mackenzie gas project, a project that Imperial Oil has indicated is marginally economic. Its study shows, and this was verified by economists and was done by an economist at Pacific Analytics out of Victoria, B.C., that the after-tax rate of return on this project will exceed 25%, and the oil companies are calling this a marginal project in Canada.

The project will deal in the hundreds of billions of dollars, with rates of return of this magnitude, yet they will be subjected to the lowest royalties and corporate taxes. All of this comes down very favourably for them. What does it do for Canadians, for our children and our grandchildren as we move along and require dollars for infrastructure and other things? It does nothing; it is squandered. This is why it is so important that we understand how our tax system works and that we stand up for Canadians.

We did not see this in the budget here and that is a shame. It is a crying shame that we do not see a move to ensure that the resources of our country serve the people of our country.

[Robert Thibault, Liberal, West Nova, NS]

Mr. Speaker, would the member comment on the question of the ideological bend toward the tax and budget cuts, especially when we look at the $1 billion supposed savings that the federal government put forward?

Let us look at where and how the government made these cuts. Let us look at something like the court challenges fund, which permitted communities, collectives, individuals, church groups to go to court with funding assistance from the federal government, if they had a valid case, to ensure that their rights were respected. Does he see it as I do, as a back door approach to stymie the Charter of Rights?

Does he agree that ideologically the Conservative government does not agree with the charter, does not believe that the charter should limit the powers of government, that it should be able to do anything it wants, even as a minority government, and that Canadians should not have access to assistance to defend or promote their rights in test cases before the courts?

I have a similar question with regard to the Status of Women. Its budget was reduced and with what remains it is limited in its activities. It cannot grant money to organizations that do research or advocacy. It cannot do advocacy work for women. I do not see that it leaves much more than the exchanging of brownie recipes.

Could the member comment on those points?

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, as someone from the Western Arctic, I am very pleased to comment on those.

The fundamentals of the $1 billion in cuts to these programs were not so much ideological as emotional. We have an emotional reaction to things that really make no sense to any Canadians. I cannot say how the inner workings of the Conservative caucus managed to come up with these cuts. I do not understand it. To me it was emotional, “I don't like this, I don't like that, let's grab some here, we don't like those people so we are going to do this”.

As to ideology, there is a mirror to what the Liberal Party did through the 1990s with the budgets, such as reducing corporate taxes, passing the burden on to Canadians in different ways, selling out on resources. I do not see much difference, ideologically, between the Conservatives and the Liberals on this.

This is a question that is open to all Canadians. Is there a difference on the broad brush ideology between the Liberals and the Conservatives? I do not see it. Although, on the other hand, emotionally, the Conservatives were frustrated in many ways with some of the minor things the Liberals did and took out various programs. The court challenges program was an emotional reaction, much like we see on some of the crime bills coming up. People will use this as retail politics. They play on the emotions of people rather than speaking to the needs of Canadians.

[The Acting Speaker, Conservative, Royal Galipeau]

The hon. member for Winnipeg Centre. There is one minute for both the question and the answer.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, could my colleague speak a little more about something I learned from his speech? That is the government seems hell-bent and determined to get oil and gas resources out of the ground as fast as humanly possible and give it away to foreign ownership for which we will only reap a minor benefit while we are giving away a legacy, our children's natural resources. Their birthright is flying out of our country at record speed and we are barely getting any royalties or revenues from it. Is that good business?

[The Acting Speaker, Conservative, Royal Galipeau]

The hon. member for Winnipeg Centre has left his colleague with 20 seconds.

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, 20 seconds is not nearly enough time to touch on the damage being done by over-exploiting resources, whether it is to the service industries in Alberta that cannot hire anyone any more, whether it is to the--

[The Acting Speaker, Conservative, Royal Galipeau]

The hon. member for Hamilton East—Stoney Creek.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Mr. Speaker, I am pleased to rise today and speak to Bill C-28 and express many of the concerns raised in the Hamilton community around the budget.

This spring's budget saw the Conservative government essentially continue the Liberal income tax cut. The government added cuts to the GST and business taxes. It simply left what I would argue would be the most important social responsibilities to the province.

On the spending side, the government has all but turned its back on the Kelowna accord with aboriginal people, with only modest funding for housing. The government's decision to go beyond the GST cut and to proceed with further personal and corporate tax cuts is troubling. This will cause a significant shrinkage in government's fiscal capacity to invest in the aspirations of ordinary Canadians. It betrays their hopes in many ways.

The Prime Minister has talked at length about being inclusive. He has all but ignored the call by the provinces for substantially increased federal funding for post-secondary education. Post-secondary education in Canada has been subjected to public cuts in funding for over 20 years. This has led to higher tuition fees and higher student debt.

The government has substituted tax incentives and individual credit measures and has taken away funding for direct programs. This is unconscionable when the government is sitting on a budget surplus of $13 billion. Much of that $13 billion was hijacked from the EI fund as far as I am concerned. It has chosen instead to throw away a chance to give real relief to our post-secondary students and to their parents.

On May 2 of this year, George Soule, national chairperson of the Canadian Federation of Students, responded to the spring's budget announcement and said:

Tinkering around the edges of the tax system is not going to increase access to college and university. This government should be restoring the billions of dollars that were cut from post-secondary education transfers during the past decade so that tuition fees can be reduced.

In my opinion the budget bills of 2006 very much follow the failed Liberal legacy of building on ineffectual patchworks of short term band-aid solutions, with no long term plan to enhance access to quality, lifelong training and learning opportunities. A lifelong learning strategy would finally reinvest in our colleges and universities and it would increase accessibility. I said earlier that there is a student debt crisis in our country which is unconscionable.

Tax credits are no substitute for restoring core funding to post-secondary education. Tuition has almost tripled since 1992. It is becoming increasingly out of reach for even middle class Canadian families, much less ordinary hard-working Canadians. The student debt crisis averages over $21,000 per student. In some cases it reaches $50,000. Imagine trying to enter the workforce carrying that burden. Instead of reinvesting in core funding and tackling the student debt crisis, as the NDP did in Bill C-48 in 2005, the Conservatives simply tinker with taxes.

Tax credits in budget 2006 will cost $185 million a year to help those students who already have $3,000 a year in scholarships. That money could have been used to pay the full tuition for 38,000 students, those students in greatest need. Budget 2006 will increase the amount of debt by allowing more students to borrow more money. That only helps the banks. It is absolutely terrible.

Another area of concern in the budget is housing and homelessness. Day in and day out in the House we hear question after question on SCPI and they are deflected by the minister. What is in the budget? The Conservative money in the budget was money that was already committed to be spent in the NDP budget, Bill C-48 from last spring. The Conservative money actually falls $200 million short of Bill C-48.

Accountability? There is no mention in the budget of who will oversee the funding and ensure the money is spent by the provinces on much needed affordable housing.

Previous Liberal governments allocated a substantial amount of money to the provinces and territories, around $474 million, but this money was not spent. It was not spent because of the failure of the Liberal government to gain a consensus with the provinces on how to do that. That is one of the major failures of the last 15 years in regard to social housing in this country. There is no mention in the budget of a national housing plan that would ensure that affordable housing is available in the long term.

Speaking more to my riding, in particular the city of Hamilton, there was a study done called “On Any Given Night”. On any given night, 399 men, women and children stay in emergency shelters in Hamilton. There are over 4,200 active applications for social housing in our community. Over 2,400 women and children stayed in a violence against women shelter during 2004 and 2005. Twenty-one point nine per cent of renter households spend more than 50% of their income on housing. It is only thanks to SCPI, which we fear is in jeopardy, that the infusion of funding for shelter beds in Hamilton was meeting the needs of single men for the very first time.

I would like to refer to a report from the social services committee of the city of Hamilton. Again, speaking to the committee's concerns around SCPI, it said:

Whereas, having a safe, secure home is a basic human right; and

Whereas, children and families are the fastest growing segment of Canada's homeless population eroding efforts by municipalities and others to nurture healthy, stable communities; and

Whereas the City of Saint John's, the Federation of Canadian Municipalities (FCM) and other organizations across the nation have recognized that homelessness and the lack of affordable housing is a national concern requiring long term solutions; and

Whereas, the National Homelessness Initiative was established by the federal government in 1999, investing $1.2 billion over the past six years in local solutions that address homelessness; and

Whereas, the National Homelessness Initiative is strongly supported by local organizations and the Government of Ontario and is recognized as an international best practice by the United Nations; and

Whereas, the National Homelessness Initiative will expire on March 31, 2007 unless the new federal government acts soon to renew the program;

THEREFORE, BE IT RESOLVED THAT the City of Hamilton urges the Government of Canada to renew and expand the National Homelessness Initiative, and calls upon municipalities and provincial and territorial governments across Canada to add their voices in support of this important program.

The concern for SCPI, the concern for our homeless, our families in jeopardy is at the forefront of the concerns of municipalities and municipal governments across this country. It is the concern of representatives in this House, but it does not seem to me to be the concern of the federal government. I cannot understand for the life of my how it can turn its back on homeless Canadians.

In closing, these are concerns that have been expressed to me by the constituents of Hamilton East—Stoney Creek and I am pleased to put them before the House this day.