Mr. Speaker, today we are debating Bill C-13, the budget implementation bill. I had an opportunity to speak for about five minutes last week on the budget. I tried to give my perspective as former chairman of the finance committee and I would like to continue in the same vein as in the last budgetary debate.
Usually the debate is the highlight of the government's agenda, whether it is a new government or not. The budget outlines where a government's priorities lie. How? By providing funds for the programs it holds most dear, while at the same time setting out the government's long term vision of where it wants the country to be in five or 10 years. This sounds like an easy concept, but it is much more complex.
This brings me to one of the reasons why most of us come to Ottawa. We come to serve our constituents and all Canadians by trying to influence the government's policy, so that our concerns are reflected in their vision for the country.
We also come to Ottawa to have the government listen, so that it can build a Canada that we stand for, a Canada that our constituents and all Canadians stand for. That is precisely what the finance committee did during our pre-budget consultations last year. We listened to the concerns of Canadians from coast to coast to coast.
We heard testimony from experts from different financial and scientific fields. We heard from artists and environmentalists. They spoke to us about the Canada that they wanted, about what concerned them for our future. Sadly, their concerns are not reflected in the government's budget.
During the budget debate many members of the House have spoken at length about Kyoto, child care, infrastructure and post-secondary education. These are all complex issues that require a proper and well thought out strategy, not just a tax credit here and a taxable payment there. How we handle these issues today will affect the way our country will grow and continue to prosper, a vision. A vision for the future, a vision for tomorrow and the next day.
Canadians have had to make sacrifices and decisions in the past to be where we are today. Do we need to throw that all away? How can we attain the vision we want for this country for tomorrow with such a shortsighted budget?
Sadly, the budget lacks depth as it introduces tax credits that will be costly and inefficient. I will point to some of the tax credits the government is offering, so that we can see how difficult and costly it will be to implement these measures and how these measures lack any long term vision for Canada.
The first is transit passes. How will the government's plan be implemented? Are commuters supposed to save their monthly transit passes and then send them to Revenue Canada at tax time? How much will it cost Revenue Canada to process all these transit passes? Have the Conservatives seriously thought about how this credit will be implemented and what it will cost?
Although Canadians may appreciate a transit credit, most of the transit companies across the country are more than likely to increase their fares in order to clawback these tax benefits. Canadians certainly will not appreciate that this quick fix is replacing time tested environmental programs such as EnerGuide.
Canadians will not be pleased when they discover that the government's idea of saving the environment amounts to nothing more than a few dollars off their bus pass. The Conservative transit tax credit will cost between 10 and 100 times more than the proposed Liberal plan. Is this the kind of shortsighted vision the Conservatives have brought to the table after waiting in the wings for 12 years?
Second, there is the government's infamous cut to the GST. We already know that virtually every economist in the country is against cutting the GST and instead they are in favour of the Liberal plan to reduce personal income taxes. We already know that this cut to the GST will only help Canada's most wealthy, leaving low and middle income Canadians out in the cold.
Most Canadians spend their income on rent or mortgage payments, food and medical expenses, things that are not subject to the GST. Let us leave that aside for now and look at how this GST cut will be implemented.
How much has the government thought about the implementation of the plan? Retail owners, for example, already have their cash registers programmed to calculate GST at 7%. Will retailers have to overhaul their cash systems? How much will that cost? Did the Conservative government bother listening to business owners? No. It preferred to grab votes with flashy announcements instead of consulting with Canadians.
To implement the reduction of the GST by 1% it will cost the Government of Canada at least $10 million in administration costs per $1 billion reduction in GST revenues of which $4 billion to $5 billion of GST revenues are expected to be lost. This is without even bothering to see how much it would cost businesses.
The Liberal plan of reducing personal income taxes would have been much more effective and less costly, since it would only affect a change on the income tax form. Is this short sighted GST cut the kind of long term planning that will allow Canada to prosper into the future? I do not think so. Where is the vision?
The 2006 budget is indicative of the Conservatives' mentality. This budget raises the tax rate on the lowest income bracket to 15.5%, which is 0.5% higher than the rate the Liberals set in 2005, and reduces the basic personal amount by $400 effective July 1, 2006.
The tax increases, which hit Canadians with the lowest annual incomes, largely cancel out any benefits from the other measures the Conservatives announced, including the reduction in the GST, which puts only a few cents a year into low-income earners' pockets.
All the noted economists in the country have said that eliminating the Liberals' tax cuts and replacing them with a one-point decrease in the GST will benefit affluent Canadians at the expense of the most disadvantaged.
What are we to think of the Canada employment credit, which is almost completely cancelled out by this same increase?
Next I will examine the Conservative plan to help students, the textbook credit. Giving an $80 credit to fix the debt load of Canadian students is almost absurd. A book credit sounds attractive but does not make for good policy.
Furthermore, there are details to this provision that need to be cleared up by the Minister of Finance. Will all textbooks be covered for this credit? If not, then which ones? Will students have to save their book receipts and send them in at tax time? How will Revenue Canada prove that the books were required for school? Will books only sold at university libraries count? What if a student is required to buy a textbook at an off campus bookstore? Maybe the government will ask students to save the course outlines they receive at the beginning of the semester and ask them to send those in when they file their taxes in order to prove what books they had to buy. Will this credit be available for all students: part time students, full time students or even adult education students?
Will this textbook credit secure post-secondary education in this country and ensure that our students are among the best in the world? I do not think so. Will it ensure that they do not graduate under a mountain of debt? I doubt it. I doubt that the Conservative government was thinking that far ahead when it drafted its budget. Again, it comes down to the kind of vision Canadians want from the government and how this Conservative government is failing them.
With regard to the child care plan, this is what the Liberal Party proposed. It was a vision that was about providing early learning opportunities to all children and giving them an equal and fair start in life. The Conservative answer is simply to give parents a taxable $100 a month allowance and let tax authorities collect the taxes on these amounts at the end of the year when families have already spent the money they received all year long.
This is not a plan. What about the tax credit for physical fitness? Do I need to explain the bureaucratic nightmare to first implement the legislation, which has not even been provided yet, and then to administer the program? To look at it another way, in order to implement its plans, the government is going to have to increase the amount of bureaucracy in Ottawa. I thought Conservative governments advocated less government bureaucracy, not more, but I suppose if that makes for good politics, the Conservatives can sacrifice some of their core beliefs.
For a government that prides itself on efficiency, the implementation of this budget will be everything but. This budget offers no long term vision for the future of Canada. It offers no indication of what the government wants for our country. Where is the leadership Canadians deserve to lead our country into the 21st century? It is not in the party sitting across from me today.