Debates of May 9th, 2006

Financial Statement of Minister of Finance

[Denise Savoie, NDP, Victoria, BC]

Mr. Speaker, conservation is given short shrift in this budget. Most Canadians are expecting leadership, not a plan that is yet to be developed or two paragraphs as we saw in the budget. Canadians expect action and a more balanced view of our obligations to our children and future generations.

The Minister of the Environment keeps repeating that she will come forward with a made in Canada plan and that our whole economy will crumble if she brings forward any measures to reduce climate change. I hope she would realize that it would be an economic advantage to Canada to maintain our competitive advantage. There are many things that we could do to reverse the trend by investing in energy retrofits, building retrofits, in green mobility and so on.

[Garth Turner, Conservative, Halton, ON]

Mr. Speaker, since many MPs wish to speak during this debate, I will be splitting my time this afternoon with the hon. member for Souris--Moose Mountain.

As members may know, I am in this House again after an absence of some 13 years. I have certainly been asked on more than one occasion why I went through the pain of an election process to get back here again. One reason is this budget.

Canadians need tax relief, honest government and more hope and opportunity, and they need to believe we have a gang in power now who cares about the survival of the middle class in our country. That is exactly what this budget says and for that reason, I support it.

This is a remarkable first step for this government and it definitely deserves the full confidence of the House. However, there are a few other reasons why I chose to come back here and why I bothered to fight to return to the House of Commons. I would like to take a couple of minutes to share some of the reasons why I am here, and maybe explain a few things about this budget as well.

The first reason I am here, which relates strongly to this budget, is to represent the people of my riding. That may sound trite and obvious, but it is rather revolutionary.

In the election campaign against the Liberals, who had been in power in my riding for the last 13 years, I was able to point out easily that no Liberal MP in my riding ever held an open and public meeting to actually ask the people of Halton what they wanted. No member of Parliament ever stood and said, “We ought to find out what the people of this riding actually want in a federal budget” and then took that to Ottawa.

In the election I made a commitment not to say anything in the House that I would not say back in my riding and I made a commitment to hold public meetings regularly with individuals and bring their voice to this place. I promised I would never send them a piece of mail with a party logo on it or use taxpayer money to tell them how to think. I told them I would work for the people and my first job would be here to represent my neighbours. That is what I am doing and that is why I am on my feet today in support of my tax-slashing colleague, the Minister of Finance.

In this new era of leadership, when politicians enjoy a popularity rating of 14%, just a little ahead of used car salesmen, it is important for all of us to make sure we are here in this place to give people their voice and to listen to it. In understanding this simple truth, a truth so simple and profound that I believe it was lost in my riding for a long time, I also came to understand something about myself.

It has now been 18 years since I was first elected to this place, 13 of them since I last sat as a member of the House. Today I am extremely pleased to be a member of Parliament. It is a badge of honour, an achievement. Of the people who sent me here, I ask for no more. I am completely challenged and fulfilled in being a member of Parliament, but I have found, coming back here, that there is intense pressure for one to represent one's party instead of the people who sent them here.

The question often arises, how do we change this? Not easily. I do believe members of Parliament need to be more independent, more powerful, with more free votes in the House and less party discipline. We need committees of MPs with more clout and the ability to do actual work in this place. They need direct input into key government initiatives, such as a budget.

The Minister of Finance welcomed my submission. I did poll people and found 11,000 Canadians who had something to say about the budget. I told the Minister of Finance, clearly, some of the things that I wanted him to hear. He listened, and I congratulate him for that.

I believe successful politicians have to stay close to their voters. They know what their voters want. They need to communicate it. I happen to believe that the biggest, most influential and probably the most underrepresented group of voters in the country, and certainly the dominant group in my riding, is the middle class. It is this group to which the budget speaks the loudest.

During the campaign I consulted this group. I came up with a pledge to them. I wrote brochures and policy statements for them. I took time to understand the pressures on their individual lives and I addressed it. These people, I know it by the nation's standards, are well off. They are solidly middle class. They are not the ones the government is busy sending cheques to, no energy rebate cheques, and no GST tax credits.

They are the worker bees of our society, the ones who are always employed, always taxpayers, always spending. Middle class people are the backbone of my riding. They make up the bulk of the population. They are responsible for the economy, as well as funding the government which redistributes their taxes to others.

However, there is a continuous erosion of family conditions right now, brought on by governments who pride themselves in caring for the rest of society at the expense of the middle class. These folks need help and attention. They deserve it.

The middle class in Canada now is actually under attack. I have pledged myself to work every day that I am in Ottawa to represent these people, to help them, to speak for them, and to fight for them. That is a major reason why I am supporting a federal budget that puts billions of dollars back in the hands of these middle class families who populate my riding in Halton.

The budget includes a GST cut, a personal income tax reduction, a universal child care benefit, more money for seniors, farmers, students, apprentices, and for the small businesses that create most of the jobs in my riding. These are the things I can go back and present to middle class voters as significant achievements and a great start down a path to tax fairness.

As I have said, I gave the Minister of Finance a prebudget report, including the thoughts of thousands of Canadians and he listened. Then his own department went online and also asked Canadians from coast to coast to coast to contribute and they did. That was a first. The minister said to Canadians, “I care what you say. I'm going to read your e-mails”, and I congratulate the minister. I think he is the first one who has ever done that.

We all have a lot to gain from that process. Voters get to be heard. Politicians get to communicate free of any special interest group filter. Governments stay in touch and we all build a better country together communicating.

I support the budget because it will improve the lives of the people who sent me here, middle class Canadians. It cuts their taxes. It assists their families. It eases household finances. It gives them new hope for the future.

I hope that all members support the budget, or at least have something constructive to say about it. I will be voting for the budget, to keep faith with the people who sent me here and be consistent with what I said I would do for them, and I do it with pride. I am honoured to be here.

Mr. Speaker, this is a beautiful seat that I occupy next to your knee. I may not be in the camera angles. I may not be in a position of influence. I may not even have the ear of the Prime Minister, but it just does not matter.

I think just being an MP is Ottawa talk. Every MP in this place matters, since we are here representing millions of Canadians. There is no bad seat in the House of Commons. There is none of us more powerful than the rest of us, since all the people in this country are equal and they all do truly want the same thing. They want this place to work and so do I, and passing this budget is a tremendous start.

[Lloyd St. Amand, Liberal, Brant, ON]

Mr. Speaker, I listened with interest to the member for Halton's speech which began, I say respectfully, with a self-congratulatory tone that was almost unbelievable.

He also went on to talk about the former member, a colleague of mine whom I know from watching him work so diligently and effectively on behalf of his constituents surely listened to the constituents of Halton on a very regular basis. Whether he was in the custom of holding town meetings or forums, I do not know, but I can tell members that the former member listened well and hard to his constituents.

The member opposite talks about listening to his constituents. I have no doubt that he listens to his constituents. When students ask him, as I am sure they do, whether it is preferable to receive an $80 credit for books and tax free scholarships, and whether the Conservative plan is preferable to the Liberal plan of providing those students $6,000 unconditionally in the first year and last year of their post-secondary studies, does he actually say to those students, if he listens to them, that the Conservative plan is to be preferred over the Liberal plan? What does he say to those students? I am curious to know.

[Garth Turner, Conservative, Halton, ON]

Mr. Speaker, I welcome the comments from my colleague across the way. I might first say to the hon. member that I did not criticize the hon. member whom I replaced in my riding personally and I have no malice against him whatsoever.

My observations were simple observations. During the 13 years the Liberals represented the people of Halton, there was never a public meeting. There was never an opportunity for a constituent to come to an open and free forum, express opinions to the member, and the member then giving a commitment to bring those opinions back. It is just a simple exercise in direct democracy and I think what the people of Halton were looking for was an opportunity to have a direct input into the system.

I also took issue with the member who preceded me using government funds, House of Commons dollars, to send householders and ten percenters around the riding with giant, red Liberal logos on them. That is a tremendous abuse of public funds. The people in my riding have told me that it was high time they had a member who would deal with their issues other than in a partisan way. That is exactly what I am trying to do.

Second, in answer to his question, the students of Halton, certainly the ones I have talked to, are happy that they are getting something. They are happy they are getting a textbook credit. They are happy that the bursary scholarship money will be free of taxation. These are real issues and real benefits to these people as opposed to promises the Liberals made and never delivered upon.

Not a single benefit for students that was contained in the last Liberal budget was ever implemented and not a single one of those dollars that the member opposite is bragging about ever went into the pocket of a student in my riding. It is just another one of the hollow promises we have heard Liberals make for a long time and those hollow promises are being replaced with true dollars in the pockets of my constituents who need them.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Mr. Speaker, I commend my colleague for his speech. I know him by reputation and I think he is a sincere man and wants the best for his constituents of Halton. I look forward to serving with him on the finance committee.

I would refer him, though, to comments made by the intergovernmental affairs minister when I asked a similar question on student assistance. The minister referred to the great programs that exist for students which came in under the Liberal government.

However, my question refers to taxation, something I know he cares about deeply. He mentioned middle income taxpayers. Maybe middle income in Halton is a lot different than middle income in Dartmouth--Cole Harbour. We all come from different constituencies, but my question refers to the brochure that came with the budget which talked about broad-based tax relief for families by income group.

It indicated that a family that makes less than $15,000 a year will save in 2007, from the Conservative budget, $96, while a family making more than $150,000, which includes probably all of us in this House, would save $1,228. I wonder if he really thinks it is fair that an MP should get 12 or more times the benefit than the family struggling to raise their kids on $15,000.

[Garth Turner, Conservative, Halton, ON]

Mr. Speaker, the hon. member opposite will know that tax savings are proportionate as a percentage of income. The government has removed 655,000 low income Canadians from the tax rolls of this country in the budget. I think that is a very significant achievement. Many families of lower income will cheer the budget of doing exactly that, of removing them from the tax rolls. The government is also reducing the GST burden by a full point on the necessities of life.

Since the GST or any sales tax by its nature is regressive and penalizes those with lower incomes, as opposed to those with higher incomes, that is a very positive measure for Canadians in lower income tax brackets. The budget actually does contain a great deal of good news for all income tax brackets. I know the member is concerned with lower income Canadians and they benefit as well.

[Ed Komarnicki, Conservative, Parliamentary Secretary to the Minister of Citizenship and Immigration]

Mr. Speaker, I have the opportunity to continue my remarks from yesterday, when I closed my remarks by saying that this is not a budget that defines the Prime Minister or the government, but a budget through which the Prime Minister and the government define the kind of Canada we want to see, the kind of Canada for which people have been asking for a long time, people who were not being listened to. What Canadians have been asking for is finally being reflected in what we see in the budget.

Also of interest, I mentioned the other day that it was refreshing to see the May 3 editorial page in the Regina Leader-Post in Saskatchewan indicating that the federal budget “keeps promises”. It is one thing to make promises and quite another to actually carry them out and put them into effect. I think members opposite were somewhat surprised to see many of our campaign platform promises appearing in the budget. I do not think they expected us to keep our promises, as this budget reflects.

This government promises and delivers. The budget itself shows that we are prepared to spend $20 billion in tax relief over the next two years, more than the last four Liberal budgets combined. As was mentioned previously, this will remove 655,000 low income Canadians from the tax rolls altogether.

When we look at the cumulative effect of the budget on ordinary working families, we find that significant dollars are being returned to the pockets of taxpayers. Taxpayers have been much overburdened over the last number of years with the many taxes collected from them, taxes that found their way to the previous government.

With respect to the GST reduction of 1%, anyone who spends $10,000 on consumer goods will end up saving $100. A family spending $30,000 on a family car or a minivan will save $300. A young family buying a home for $150,000 will save somewhere between $960 and $1,200.

On top of this, a Canada employment credit is available to everyone, with $500 now and then $1,000 as of January 1, which is another $150 saving.

The budget provides a reduction in the lowest tax rate from 16% to 15.5%. Again, a simple calculation shows $150 more left in the pockets of ordinary Canadians. As well, an increase in income that can be earned without paying federal tax results in more dollars being kept by ordinary people.

A family with three children under six years of age with a stay at home mom will receive $3,600 per year. That is quite a significant amount.

When we start adding up all of the benefits portrayed in this budget, we see that they add up to thousands of dollars.

If someone wants to register a child in a sports program, which happens throughout all communities in Saskatchewan, and rural communities in particular, they can deduct about $75 from taxes.

That is not all. If mom or dad wishes to become a skilled worker, each is eligible for a $1,000 grant for the first and second year of an apprenticeship program. In years one and two of an apprenticeship program, that amounts to $2,000.

If someone needs to buy tools for their employment, there is an additional exemption of $115. This budget allows for a 100% capital cost allowance on tools purchased. This has been increased from $200 to $500, for another $45 saving.

A student in a post-secondary education program will receive an $80 net tax deduction for textbooks.

If mom or dad use the transit system, there is another $150 or an $80 a month tax credit.

This budget allows a young couple purchasing furniture worth $20,000 to get a $200 saving.

I am sure I have missed some of the many tax benefits for ordinary Canadians allowed in this budget, but the savings amount to thousands of dollars being put back into the pockets of Canadians. This is long overdue. It is time that we respected the taxpayer. This budget reflects that. It gives some relief to taxpayers who have been overburdened over the last number of years.

I would also like to take a moment to talk about our farming community. The Liberal opposition members, when in government, were a lot on promises and hot air, but were cold hearted, callous and uncaring when it came to the farming community. In particular, they designed a CAIS program that has been a bane and a problem for farmers and farming communities for years. Farmers who have retired and do not now farm have been able to receive thousands of dollars under the program, yet young farmers just getting into farming have received very little. There have also been differences between neighbours with CAIS, with some receiving payments and others getting none.

CAIS is a program that does not take into account falling commodity prices. They have been falling year after year and the program simply reduces the margin. It does not take into account the effect that falling commodity prices have on inventory valuations, thereby causing an additional loss of money for our many farmers in Saskatchewan. As well, the rising costs of production are not addressed.

Perhaps the sorest point of all is the clawback provision that was in existence for any government payments that were made, including the grains and oilseeds program. They were clawed back for any overpayments out of the CAIS program. It has been an administrative nightmare, with farmers receiving money on the one hand and having to pay it back on the other hand and not really knowing how the problem is to be addressed.

We find the one thing that CAIS has done, perhaps, is provide jobs for people administering the system. It certainly has not provided the money at the farm gate for the farmers and the farm families who require it.

The CAIS program has 2003, 2004 and 2005 issues that are being addressed as we speak. The farmers operate on a seasonal basis, planting a crop and harvesting a crop. Things have to be determined within that cycle, not over many years. What we find is a system that is too complex. Farmers are losing hope and even the accountants are getting gun shy in terms of trying to come up with what the farmer may expect.

In many respects in my province, CAIS is looked at by many as the laughingstock of government programs, except that it is not very funny. There are many auctions happening in my constituency, more than I have seen in all of my lifetime. This is not something that is particularly appreciated by the farming community, which is going down and is losing the hope that it needs to succeed.

The Liberal opposition members opposed the budget. I wonder what it is in the agricultural part of it that they take issue with. I looked at the budget itself, which states that it “will provide an additional $500 million per year for farm support and to work with farmers” and other partners toward securing “a more prosperous future for this sector”. We promised in the campaign that there would be $500 million to deal with disaster relief and we have delivered that $500 million. On top of that, we have put in an additional $1 billion to address farmers in transitional programming.

The government has also indicated that it will replace the Canadian agricultural income stabilization program, CAIS, and it is in the process of doing that.

It is also providing funding to shift the inventory evaluation under the CAIS program to make the program more responsive. Farmers lost thousands of dollars in that regard. The government is putting place a deeper coverage with respect to many issues such as the declining balances. It also talks about a cover crop protection program for those who have been flooded out. It seems that a program like that should have been in existence for a very long time, but it has not been.

I would say that even at a start under this budget farmers are already better off. The minister has indicated there will not be any more clawbacks and there will not be any interest on overpayments on the CAIS program until January 1, 2007.

There are also initiatives on the biodiesel and biofuel side, which will transform the prairie agricultural industry as we know it.

What are other Canadians saying about the budget? There was a poll done recently by Ipsos-Reid. It said that the numbers of people who like the budget are double the numbers of those who do not. In Quebec there is a positive response of 60% and in Alberta 67%. Mr. Wright, the senior vice-president of Ipsos-Reid, said, “The Harper government has really hit a home run with this budget”.

There are many people who have said that this budget is a budget that is accepted by all Canadians. A COMPAS Inc. poll found that Canadian CEOs give the budget an overall score of 76%, and it was stated that this budget is “far more popular than the recent budgets of by Alberta Premier Ralph Klein, Ontario Premier Dalton McGuinty, or former prime ministers” the hon. member for LaSalle--Émard and Jean Chrétien. That is quite a remark.

Another newspaper in my circulation area said this, “Virtually every Canadian will see some benefit from the new Conservative government's first budget”. Every Canadian will receive something, said the newspaper, adding, “The bottom line on this budget is that [the] Prime Minister...has delivered on all his election promises...”. It states that he has established the most important factor for Canadians, the “trust factor”.

I would say that it is refreshing to see that. It is refreshing to see promises being kept and implemented in the budget.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Mr. Speaker, I would like to talk about two issues in the budget that concern me most. One is the inherent unfairness of it in giving an advantage to those who spend, those who make more money. The budget documents themselves even tout the savings on a $350,000 home. There are probably ridings in this country that do not have even one $350,000 home.

I want to talk about the other aspect of it, which is that the measures in it are the triumph of politics over policy, of show over the activity that would improve Canada's economy. We know now that the issue for Canada and the world is that the world is changing, with emerging economies now spending money on innovation and technology.

According to the budget documents themselves, Canada has done a remarkable job. We now lead the G-7 in investment in research at the university level. It is all very important, but this budget hardly mentions this at all.

The second part of university and post-secondary education overall, including community colleges, apprenticeships and skills upgrading, which are very important, is putting money into post-secondary education for Canadians who can least afford it.

In the economic update introduced by our government last November, we dedicated $2.2 billion over five years for students most in need, for aboriginals, low income Canadians and persons with disabilities, and another $265 million specifically to help disabled people get into the workforce. There is nothing in this budget to address that.

I wonder if the member would agree, first, that the government has a role to play in assisting those most in need to get post-secondary education and, second, why that would not be mentioned in the budget.

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

Mr. Speaker, the budget does refer to education. It indicates that students will not be taxed on the scholarships, bursaries and other income they have. They will get the tax credit. Parents will be able to earn greater income, with students being able to access funding that they otherwise would not have been able to access.

We have $100 million earmarked for research and development. There are transfers to the provinces. The budget talks about the fiscal imbalance that the Liberal government has created. It has taken millions and millions of dollars out of the provinces, out of provincial jurisdiction, thereby causing a significant problem for the students of this country.

The Conservative government will rectify that problem and actually put some money in the hands of the provincial governments so they can actually provide better education for the children who are growing up in their provinces. Let me tell the member that when we have strong families actually able to make a living, they will certainly be able to stand behind their students and they will do far better in terms of supporting students than they have been able to do under the previous Liberal government.

[Richard Nadeau, Bloc, Gatineau, QC]

Mr. Speaker, I salute my colleague from Souris—Moose Mountain.

First of all, the Bloc Québécois finds it interesting that the fiscal imbalance should be addressed in this budget. You will recall that the previous government did not even want to utter those words, even though the Bloc Québécois, the opposition at that time, had made a very eloquent demonstration of this fiscal imbalance on the basis of the Séguin report.

That being said, there is still one thing that bothers me. That is the question of employment insurance. In that connection, I would like to ask him the following question.

What is the hon. member’s position on the creation of an independent employment insurance fund managed by workers and employers, who would ensure that we never again see the astronomical sum of $48 billion scattered elsewhere in the federal budget instead of being returned to the people who, at some point in their careers and lives, need to receive employment insurance benefits?

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

Mr. Speaker, there is no question that under the previous Liberal government $50 billion had been collected from workers and employees, to a great extent, and used for general revenue purposes. The hon. member will understand that we looked at that specific issue very closely. I think the Prime Minister addressed it in the House. It is part of the whole issue of the lack of funding by provinces and specific groups.

I can say with respect to the issue relating to fiscal imbalance that this budget has targeted provinces in a way that they have not been targeted before, particularly with infrastructure. When we look at the number of dollars going back into communities, we see that it is significant. It is in the billions of dollars. It is infrastructure in many respects that has been eroded in the province because of the dollars that have been taken from the provinces by way of revenue. They were not able to provide those services.

These are all issues that the Conservative government will be looking at. Indeed it will.

[Blair Wilson, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Mr. Speaker, I will be splitting my time with the member for Beaches—East York.

I rise today to speak to the recent Conservative budget and how it has failed to address the real needs of Canadian families and, specifically, the needs of British Columbians and the citizens of West Vancouver--Sunshine Coast--Sea to Sky Country.

The Conservative government inherited a strong fiscal record from the former Liberal government. It inherited eight years of balanced budgets, a 30-year low in unemployment and a record surplus that was the envy of all G-8 nations.

It is absurd that the government is now raising income taxes and slashing spending by $1 billion a year without, I may add, telling any Canadians exactly which programs will be cut. It is a complete lack of a vision for Canada's future prosperity.

The Conservatives are also throwing out fiscal prudence and spending programs that are on the books that they cannot account for.

The budget is both fiscally irresponsible and socially destructive.

The budget has failed to provide real tax relief for low and middle income Canadians. The budget has, in fact, raised the lowest level of personal income tax from 15% to 15.5% and has lowered the basic personal exemption from $9,039 to $8,639. How is this helping the middle class, helping working Canadians?

The bottom line, however, is that even after considering the GST tax cut the Conservatives are so happy to parade around and the new Canadian employment credit, which is basically a $1,000 increase in the personal exemption, the budget actually is a wash for low and middle income Canadians.

Eliminating the Liberal income tax cut in favour of their 1% GST cut has been panned by every serious economist in this country as a plan that will benefit higher income Canadians off the backs of the poor. Reducing the GST, while a strong political and public relations move, is a terrible economic move. Economists and public policy experts all agree. The GST is not even charged on essentials, such as housing or food, which make up by far the greatest expenditures for low income Canadians.

The people I have talked to in my riding since the budget have told me time and again that on the surface the budget looks pretty good but that in reality it is all smoke and mirrors, just a con from the Conservative government.

The budget has also failed to achieve any kind of fiscal integrity. The previous Liberal government's fiscal framework contained a contingency reserve of funds intended to guard against unforeseen events, a fund that was anywhere between $1 billion and $4 billion. The Conservative budget, this budget, eliminates all economic prudence.

The cushion gave the previous Liberal government the fiscal room to weather unforeseen events, such as September 11, mad cow, SARS and the Asian currency crisis, all without going into deficit.

At the same the Conservatives have spent and cut their way very close to the line. They have removed the cushion which was an integral part of the federal government's ability to turn this nation's finances around.

The budget has also failed to address the issues of climate change. In fact, I would believe this is a pro pollution budget because it represents a 93% cut to environmental funding and a complete disaster for future generations of Canadians. The Conservative budget has all but gutted every cent of the previous Liberal government's commitment toward the protection of the Canadian environment. The government has eliminated climate change programs and is getting set to pull out of the Kyoto accord. It also represents a 100% cut in funding for climate change, ensuring that Canada will be unable to meets its Kyoto commitments.

The Conservatives' response is a transit cut that is both costly and ineffective. It will cost almost $400 million over two years and only increase transit use by, get ready for this, 5%. This translates to a cost of $2,000 for each tonne of carbon dioxide saved; 10 to 100 times the cost per tonne under the previous Liberal project green plan.

To quote Dale Marshall of the David Suzuki Foundation:

[The] Prime Minister...has dismantled the only climate change plan our country had and replaced it with subsidized transit passes that will do little to fight air pollution or convince people to leave their cars at home. It’s completely irresponsible.

Furthermore, the Conservatives plan to pay for this, even though their so-called climate change program is still under development, by scrapping $2 billion of the existing climate change program. They are trying to develop a strategy as we speak.

The budget is deliberately misleading about its alleged environmental funding.

In the budget speech, the minister claims that his government will dedicate $2 billion toward the development of a climate change plan but the budget itself provides absolutely no money. The government also claims that it will spend $1.3 billion on public transit but this is not new money either, having been committed by the previous Liberal government.

The city of Squamish in my riding is an ideal site for the production of wind power. Quantum Windpower, a team of entrepreneurs with a commitment to develop and manufacture commercial wind turbine equipment in British Columbia, is seeking to build a manufacturing plant for wind turbines. Government funding is invaluable in order to launch Quantum's manufacturing facility and its business plan, which includes export potential.

With no money for renewable energy, no money for energy retrofits and no money for energy efficiency programs or green initiatives, the Conservative government is turning the clock back on real climate change initiatives.

As well, the Conservatives have failed to provide a real child care choice for parents. The Conservatives are completely out of touch with, or simply do not care about, the needs of the majority of Canadian families. If a paltry $20 a week for child care is not insult enough, the Conservatives will actually take $1 billion from Canada's neediest families by cutting the youth child supplement of the Canadian child tax benefit. The Conservatives are cutting $1 billion from this program which was supposed to reach $10 billion by next year. The Conservatives have failed to establish a real plan to create child care spaces at all.

Rather than honouring the Liberal child care agreements, something that the majority of the provinces, parents and advocacy groups have demanded, the government insists on forging ahead with a nebulous plan which will mean provinces will lose stable funding agreed to by the previous government. Giving with the one hand and taking away with the other, is that the Conservative idea of support for Canadian families?

Last year British Columbia signed an early learning and child care agreement with the previous federal government promising British Columbia $633 million over five years to improve child care services. This was an important step forward in providing B.C. families with the child care choices they desperately need.

Last October, using federal dollars, the first improvements to B.C.'s fragile child care system began. My riding saw improved child care subsidies, increased operating grants to child care centres, special services for families through the child care resource referral program and increased capital funding to build child care centres.

In my riding, the many preschools, day care centres, family child care, parent-child care activities and family resource programs will experience the loss of federal dollars that will result from severe cuts to child care services and the child care subsidy program, increased child care fees for all parents and losses of child care spaces.

For the constituents in my riding who could use this money the most, the true value of the proposed allowance could be as little as $1 a day per child aged six and under. Meanwhile, parents with school age children will receive nothing. My constituents tell me repeatedly that they need to work. Child care is not a matter of choice for them.

As well, the Conservatives have failed to address the very pressing needs of Canada's aboriginal people in this budget. Rather than honouring the historic Kelowna accord signed last November, which would have substantially improved the lives of our first nations people, the Conservative government chose to ignore them, cutting planned funding by 80% from $5.3 billion to just over $1 billion.

My riding is home to many different native groups, including the Squamish first nations, and many have agreed that this budget does very little to deal with the gap in the quality of life between aboriginals and non-aboriginal Canadians. The B.C. First Nations Leadership Council has called one the Prime Minister to live up to the financial commitments contained in the Kelowna accord in order to address the critical socio-economic and infrastructure gaps suffered by first nations.

Chief Gibby Jacobs of the Squamish first nation, one of my constituents, has also expressed great concern over this budget. The budget has failed dramatically on education and innovation. It has also failed on its priorities to Canadians. One of the strongest priorities to Canadians has been health care, which has been completely panned and ignored by the government. The federal budget provides no additional funding for wait time reduction nor any explanation of how the wait time guarantee will be implemented. What happened to the Conservatives' priority of fixing waiting times?

The budget has failed to honour the promises to British Columbians and the Conservatives have slashed vital programs. During the election the Prime Minister promised to recover 100% of the illegally imposed softwood lumber tariffs. He promised to replace and upgrade the naval vessels stationed at CFB Esquimalt, establish the Canadian Coast Guard as an independent agency and invest $276 million over five years in expanding and updating the fleet. Perhaps British Columbia is too far away from Ottawa for Mr. Harper and the Conservatives.

In conclusion, I think this is a destructive budget. It will harm British Columbia and there will be no help for western Canada.

[The Acting Speaker, Conservative, Royal Galipeau]

Before we go to questions and comments, I would like to remind the hon. member and others that in the last hour I heard the name of a right hon. member of the House being used directly. Of course, the experienced members of the House know that we do not do that. As of this moment, I would like the inexperienced members to also know it.

We name people in the House by their ridings or by their titles. Sometimes their ridings are long and difficult to remember but that is what we do. We do not use names.

[Ed Komarnicki, Conservative, Parliamentary Secretary to the Minister of Citizenship and Immigration]

Mr. Speaker, I have one comment relating to the personal income tax rate. There is no question that the budget contains a total of 29 separate tax reductions which amount cumulatively to a far greater tax reduction than the party opposite gave in the last four years.

In particular, we found that the current personal income tax rate of 16% was something that the party opposite proposed to reduce but never did. The Liberals made many promises but they were promises that would have taken effect five years down the road when they would not likely to be in government and not likely have to deliver.

Is the hon. member indicating that he wishes the budget to be voted down and the personal income tax rate to remain at 16% as opposed to what it should be?

What does he think about the cumulative 29 separate tax cuts for Canadians and $20 billion of tax relief, more than the last four budgets of the Liberals when they were in government? Why would he disagree with such tax breaks to ordinary Canadians?

[Blair Wilson, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Mr. Speaker, I will deal with two specific issues.

If the hon. member would check the 2005 tax guide he would see right on there that the rate for personal taxes at the lowest level is 15%. The new rate that the Conservatives are proposing is 15.5%. Anyway we cut it, that is 0.5% increase for the people who can least afford it.

My response is that there have been 29 separate tax cuts. These different tax cuts, tax credits as well, are not a strategy or a plan for the future. This is a piecemeal approach to buying votes. I think it is blatant vote buying by the government. The Conservatives are not worried about the future of Canadians. They are worried about the next nine months.

To answer the question, yes, there is a definite increase in taxes by 0.5% and, by lowering the personal exemption rate by $200, we will add more Canadians on to the tax rolls, not take them off.

[Richard Nadeau, Bloc, Gatineau, QC]

Mr. Speaker, do my colleague from British Columbia and his party recognize the fiscal imbalance? Do they recognize the reality of it as it relates to Quebec and the different provinces?

Over the 13 years when the Liberal government was in power, the shortfall plunged the provinces into situations that made it extremely difficult to work in such critical fields as health, social services, appropriate income and education.

Does my colleague recognize this concept, which is of great importance and needs to be resolved?

[Blair Wilson, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Mr. Speaker, I warn the hon. member about the words “fiscal imbalance” when he is talking about the budget that has been proposed by the Conservative government.

If he takes a very close look at it, he will see that in the year coming up and the year that follows, there is very little put aside for fiscal prudence and very little put aside for a cushion. Where we had $8 billion to $10 billion of surpluses with which to adjust the fiscal imbalance, the government will have absolutely zero.

The Conservatives have about $600 million as a potential surplus next year and zero the year after. Even if the member could get the Conservatives to acknowledge that there is a fiscal imbalance and there are to be policies to address it, they will not have, I am afraid, any money to deal with it.

I would say to the hon. member that if there is not going to be any money to deal with the fiscal imbalance, I hope he will join our side to vote against the budget when the vote comes to the House.

[Lloyd St. Amand, Liberal, Brant, ON]

Mr. Speaker, I commend my hard-working colleague on his insightful speech about the budget.

There is one thing I have had some difficulty figuring out. As I understand it, the proposed transit pass program will cost taxpayers $2,000 to reduce one tonne of greenhouse gases. The energuide program to reduce one tonne of greenhouse gases was costing only $20. I am wondering if there is any logic to this. Perhaps my friend could shed some light on it.

[Blair Wilson, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Mr. Speaker, the Conservative government does not have a plan for the environment. It does not believe in global warming. It does not believe in honouring our commitments to Kyoto. It is a disaster waiting to happen on the environmental front.

[Maria Minna, Liberal, Beaches—East York, ON]

Mr. Speaker, I want to start my remarks by focusing on one of the most egregious parts of the budget, the notion of the $1,200 child care allowance, which I do not consider to be a child care allowance at all.

The government keeps calling the $1,200 allowance universal child care and that it is giving choices to parents, but we should look at the facts and make a proper distinction between income support and child care. The reality is that the $1,200 is a family allowance, not a child care plan. As a family allowance it is fine, but it is not a child care plan.

The most effective weapon to fight child poverty in this country is the child tax benefit. Experts believe that the benefit has reduced child poverty by approximately 26%. If we were to apply the $1,200 to the base of the child tax credit, families would receive the full $1,200 on a net income of up to and including $112,000, after which there would be a clawback up to and including a net income of $172,000. This is what the allowance should be, income support through the child tax credit. It would address the incomes of modest families as well as middle income families and even higher.

Instead, the Conservative government is cutting the young child supplement portion of the child tax benefit. This means that most families with low or modest incomes will lose $249 right off the top, reducing the child care benefit to $951. Taxes are increased at the same time by .5% at this level, which of course means that families will lose even more.

Further, the child care allowance treats some families better than others, even though they have the same net income and the same number of children of the same age. Because the benefit is taxable in the hands of the lowest income earner, single parents and two earner families are going to lose out. Two earner couples will lose a significant portion of the benefit to income taxes, but still not as much as single parents will lose.

Single parents in the $30,000 to $40,000 income range will lose on average close to $400 of the benefit in taxes. If this is added to the $249 that they will lose because of the elimination of the young child supplement, these families will be left with only about $550 of the $1,200 benefit, less than half the benefit that some of the other families will be receiving, and they will have a tax increase on top of that. This is not a plan for all families. This is punitive to some families and chooses others. Nor is it an early learning and child care plan, so it does neither.

This is unacceptable because the government is basically choosing which types of families it prefers and which types of families it does not. Not giving the same choice to all families and penalizing choices that families actually make about themselves is dastardly. I have never seen anything like it. This plan is neither an income support plan nor an early child care plan. It does neither and helps no one.

In addition to the national child care plan and the child tax credit which the Liberals started in this country, the early years program, or the best start program, was started in 2000. In my riding of Beaches—East York stay at home parents have told me many times that this is a wonderful program for their children, that they are quite happy with it and use it often.

Again I go back to choice. I keep hearing from the government side that the $1,200 gives choice. If there are no spaces to choose from, there is no choice whatsoever and the money parents receive is not enough to pay for the full amount of child care. There are really no choices. as there is nothing there to buy.

The government says that businesses will create spaces. Again, this has been tried in Ontario. The Minister of Finance knows it, as does the Minister of Health and the President of the Treasury Board, all of whom were in the Ontario government. They know it does not work. The Canadian Federation of Independent Business has said its membership is not interested. Again, it is a vague plan and there is no child care plan in this country.

The finance minister was part of the Ontario cabinet that cut funding to schools. It cut sports programs, music programs, all kinds of programs in schools and many other services and ended up with a huge deficit, which is why Ontario now has an income problem, which is really where it is at. Now that same minister is the Minister of Finance for the Government of Canada. Guess what he is going to do to Canada. Exactly the same thing that he did to Ontario, nothing more, nothing less.

The city of Toronto alone will lose 6,000 child care spaces this year. This means the families in my riding of Beaches—East York will be suffering badly. This is not acceptable.

I want to move on to the issue of post-secondary education. The previous Liberal government had proposed $550 million over five years for grants for post-secondary education to an additional 55,000 students over four years of study; $2.2 billion over five years to improve the student financial assistance system; $210 million over five years for graduate scholarships; $150 million over five years for scholarships to study abroad; and $1 billion in 2005-06 for the provinces to invest in post-secondary infrastructure. That is all gone. It has been cancelled, except for the commitment in the budget to spend $1 billion for provinces to invest in post-secondary infrastructure, but that is it.

The Conservatives offer tax credits and not improved access. The $125 million per year tax credit for the cost of textbooks does not do it, nor does the $50 million per year for the elimination of taxation on scholarships. This budget cancelled funding worth $3.11 billion over five years. This is a huge chunk. This is 50% of the first and last year of tuition as well as grants for all low income students and other supports.

All of those funds were going directly to improve access to post-secondary education. This funding has since been replaced with $175 million in tax incentives which do little for access considering that students who struggle most for access pay little tax in the first place.

The budget does spend on apprentices. The budget offers three tax incentives for apprentices totalling about $380 million per year. The government is very proud of all of these itsy-bitsy amounts, but this pales in comparison to $3.5 billion over five years in the November update for the workplace skills strategy with the provinces. The strategy was cancelled in the budget and is now included in the fiscal imbalance discussions. That was settled. That was a lot of money in a partnership with the provinces to address that issue.

The budget cancels more than $2.1 billion over five years to increase support for the granting councils, the indirect costs of research program of the Canada Foundation for Innovation and the Canadian Institute of Advanced Research and again $200 million over five years for up to 3,500 R and D internships in the natural and health sciences and for engineering graduates as well as up to 100 scholarships each year to engineering and natural and health sciences graduate students seeking a masters in business administration.

This is not a plan for prosperity. This is a disaster. Everyone talked for such a long time about brain drain in this country. We now have a brain gain because of the investment that we have made in innovation and research. We have been attracting people from other countries to come to this country. The Conservative government has turned it around. It has dropped it all. It is gone. For what, I ask. There is nothing in its place.

Education, prosperity, innovation, research, students, universities, partnerships with provinces are all gone. It means nothing. An agreement is signed but it is absolutely meaningless.

On the environment, again it is a very sad situation. The government has cut all the programs, the EnerGuide program for families, the high efficiency home system. Most of the investment is gone.

The only one that the government really hangs its hat on is the public transit credit, which by the way, as other members have said, costs $2,000 per tonne, 10 times more than our plan. Environment Canada had advised the current government that this action would not increase the number of public transit users, would not effectively lower greenhouse gas emissions and would not help reduce pollution.

The government seems to have decided to hitch its hat to the United States and China and has dropped Kyoto completely. The minister now chairs the Kyoto process, but basically is a chair only in name because in essence it is really a shame for Canada. We are no longer leaders working with our partners.

There is lots more that I could say, but I see that I have run out of time.

[Dave MacKenzie, Conservative, Parliamentary Secretary to the Minister of Public Safety]

Mr. Speaker, I listened to the hon. member speak about cuts that were made in provincial budgets, particularly one province. She spent a great deal of time talking about cuts in programs and cuts in budgets. I wonder if she can tell the House where those provinces should have made their cuts, when the federal government made its massive cuts in the nineties.

[Maria Minna, Liberal, Beaches—East York, ON]

Mr. Speaker, I am glad the member asked that question. The deficit we had to deal with of $42 billion was left by the Conservatives. It was a huge debt. Unemployment was nearly 12%. Interest rates were in double digits. Canada was a financial basket case in the world in terms of its credit rating. We were in a horrible mess.

At the time, as a member of Parliament, I objected to the depth of the cuts, but nonetheless they had to be done. Since then we reinvested more money in students, universities, research, hospitals, seniors and housing. None of that has been mentioned. I am adding things on because in my 10 minutes I could not put in all of the things that the Conservative government has dropped, things that were on the table and agreed upon with the provinces.

The present Minister of Finance left the province of Ontario in a deficit. That is why we are talking about fiscal imbalance. The present minister not only left a deficit in the province of Ontario but he will do the same to this country that the previous Conservative government did when we took over 13 years ago.

I am sorry, but I do not think the member has a point there.

[Catherine Bell, NDP, Vancouver Island North, BC]

Mr. Speaker, I must agree with my hon. colleague on a couple of points she made in her speech. Funding for education and for the environment has been cut. I must agree with her comments with respect to the issue of child care not being a national program, but basically being a family allowance for the children of Canada.

However, I have to shake my head a bit at some of her logic. I heard her hon. colleagues speaking in the House the other day and they were saying that every child in Canada had the right to an affordable national child care program. I have to wonder about their comments because we heard promises being made by that side of the House for 13 years. My children grew up without the benefit of a child care program.

There were many surpluses over the years. In fact, she said that in the last Parliament there was an $8 billion surplus. I am just wondering why the Liberal government did not provide a national child care program. Why is it that at the behest of the NDP the Liberals actually started on that road?

[Maria Minna, Liberal, Beaches—East York, ON]

Mr. Speaker, we did start in the year 2000 with $2.2 billion on the table. At that time the provinces would not agree to any solution except to allow them to cherry-pick and choose which programs for children they would use. In my province of Ontario there is a program called the early years program.

I agree that we should never have backed off. We should have insisted that the $2.2 billion stay as child care money. We did try in 2000. We tried again in 2004 and did get an agreement. If it was not for the NDP bringing down the government, instead of allowing that program to take root, it would not have happened. The election could have waited a couple of months. We did have an agreement with the provinces. A national program was in place, but the Conservative government chose to cancel it.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Mr. Speaker, I will be sharing my time with my colleague, the member for Drummond.

A number of my colleagues have addressed different facets of the budget. Some have spoken of the fiscal imbalance. In this regard, the budget speech provides an excellent schedule. Others have spoken about measures pertaining to day care costs, which are not really measures but rather a cheque for a maximum of $1,200, which is taxable on top of it. It strikes me more as a vote getting measure than one intended to swell the coffers of parents facing day care charges. I will not be looking at this.

As the labour critic, I looked more at what workers' associations and employers' or professional groups think. This is what I will look at. This is what I want to talk about today. I will in fact report to you what workers' and employers' associations have said.

Ken Georgetti, the president of the Canadian Labour Congress, which has a membership of three million workers, said there was neither vision nor hope for working families. Mr. Georgetti feels that the federal Minister of Finance has let down working families in his first budget. He feels that “it shows no vision of the country and offers no sense of hope to working Canadians”.

The government squanders huge surpluses while workers can’t find child care for their kids, can’t get training to do their jobs better, can’t protect their pensions when companies go bankrupt or can’t get the money promised for pay equity.

That was the opinion of the CLC, the Canadian Labour Congress.

The CSN, the Confédération des syndicats nationaux, as everyone knows, moreover, headed by Claudette Carbonneau, considers that the budget does not contain any big surprises, but a series of vote-buying, election-minded measures.

With regard to the fiscal imbalance, the only real commitment, according to the CSN, is one of scheduling.

Regarding health, the CSN says that this budget does no more than maintain the previous agreement with the Liberal government, even though the needs are obvious.

The CSN’s big disappointment comes from the lack of a first gesture towards post-secondary education. The CSN also notes that this budget sanctions the end of the agreement between Quebec and Ottawa on the funding of child care. “There is nothing in this budget, except for a bunch of sweetened measures designed to assuage the difficulties of the manufacturing sector”.

The CSN also says:

There is no concrete response to the problem of older workers who are victims of mass layoffs.

There is nothing for the unemployed, although the Conservative Party made a commitment in the election campaign in favour of an independent employment insurance fund.

There is nothing for the immediate implementation of the Kyoto protocol. Still, the CSN is happy about the measures respecting public transit.

The CSQ, the Centrale des syndicats du Québec, headed by Réjean Parent, is disappointed with the stingy announcements concerning post-secondary education. Concerning the fiscal imbalance, the CSQ notes that there is no real solution and the government is acting very cautiously. The universal child care benefit, the much talked about cheque worth a taxable maximum of $1,200, remains inequitable for the families who need it most.

The CSQ considers that Quebec will be penalized by the Conservative government’s decision to invest exclusively in the development and not in the operation of child care services. It is concerned about the fact that the budget seems to confirm Canada's abandonment of the measures defined in the Kyoto accord and existing climate change programs.

The CSQ hails the tax credit for purchasing a monthly public transit pass, which as we know was a bill presented by my Bloc Québécois colleague for the riding of Longueuil—Pierre-Boucher.

The FTQ, the Fédération des travailleurs du Québec, is extremely disappointed by the government’s indifference towards the manufacturing sector. “For example,” it says, the government could have had recourse to the transitional measures provided by the WTO for textiles”.

There is not anything for setting up a genuine income support program for older workers.

The steelworkers' union is very disappointed that the national child care program has been abolished and replaced by a $1,200 election promise. The union feels that this is unfair, and it is also disappointed because “it comes at a time of comfortable surpluses that should be used to build a solid, supportive public policy, not a quick payout and tax breaks”.

The budget “also does nothing to address the crisis in Canada's manufacturing sector...The $400 million supposedly earmarked for encouraging forest industry competitiveness and fighting the mountain pine beetle is a drop in the bucket to an industry that is already in crisis”. The union also criticizes the government for not taking action in the budget to improve protection for workers' pensions.

The Public Service Alliance of Canada feels that the Conservative government’s budget will limit the rise in expenditures at a time when the economy is growing rapidly.

I would just like to take advantage of this opportunity to say that, until last Friday, Nycole Turmel was the president of the PSAC, and I now welcome the election of its new president, John Gordon.

“If the government is planning to institute these cuts….there will be a serious impact on the provision of federal public services,” the PSAC continued, speaking through Ms. Turmel.

Instead of taking advantage of the growing economy to spend tax dollars investing in public infrastructure, child care and other programs Canadians say they want, the Conservatives are unnecessarily speeding up the federal debt reduction plan.

The Canadian Union of Public Employees believes that this government’s “fixation with tax cuts is driving the federal government to abandon its role in providing quality public services” and it adds:

The 1 per cent reduction in the Goods and Services Tax will cost Ottawa over $5 billion a year in lower revenue, creating pressure to cut program spending

So as we can see, unions and working people’s associations are very or even extremely disappointed with this government’s budget.

And yet a different tune is heard from the associations representing employers and professionals.

The Certified General Accountants' Association of Canada is pleased. The Investment Dealers Association of Canada gives this government a good grade. The Board of Trade of Metropolitan Montreal welcomes the budget. The Canadian Chamber of Commerce says that it is happy. The Conseil du patronat du Québec is very much in favour of this budget.

When we see that working people’s groups are disappointed and employers’ and professional associations are happy, we do not need a lot of studies to understand that this budget favours employers over working people. We see as well that this government is not at all sensitive toward working people.

The only times that this government mentioned working people in the budget speech or the throne speech, it was to talk about the 1% reduction in the GST.

Working people are not just “taxpayers”; they are important participants in the social and economic development of our society, and they should be considered as such.

In conclusion, I would like to say a few words about the aeronautics industry.

The south shore is an aeronautics region. Half of Canada's aeronautics jobs are in Quebec, the Montreal area in particular and even closer to my riding on the south shore. We call it the aerospace region. The Saint Hubert airport is there. The Canadian Space Agency is in Saint Hubert. The ENA or national institute of aeronautics, two of the largest aeronautics companies and a number of aerospace research councils are in the immediate area. It is a science and technology park like no other in Quebec or Canada.

So, what is in this budget? What is in the Speech from the Throne? Not a word on aeronautics; nothing but vague allusions to research and development.

What became of the funding for the aeronautics policy tabled in this House last November?

It was a good policy. It had been copied from a Bloc Québécois proposal developed in consultation with aeronautics companies. The previous government had cut and pasted parts of the Bloc Québécois proposal, but did not present any funding for the policy.

We truly expected this Conservative government to propose funding in its budget.

As you can see, the aeronautics industry is extremely important. This industry creates meaningful, high-tech jobs, which are enriching for everyone, if my meaning is clear.

That is all I wanted to say. I would add on behalf of myself, all workers and the aeronautics industry that this budget is extremely disappointing.