Debates of Oct. 25th, 2007

Opposition Motion—The Economy

[Shawn Murphy, Liberal, Charlottetown, PE]

Mr. Speaker, I take it that the member is not supporting the corporate tax cuts, but I want to point out that the questioner is a member of the New Democratic Party. Let us look back at the actions of the New Democratic Party.

The actions of the member's party are why we lost our housing program, why this country is no longer a signatory to the Kyoto accord, and why we lost the Kelowna agreement. The NDP is the reason why we lost the early childhood development agreements that were negotiated with all 10 provinces. Those members abstained when the softwood lumber agreement was put to this House for a vote. I would think that every Bay Street person watching this would be very pleased with the NDP over the last couple of years.

[Rick Dykstra, Conservative, St. Catharines, ON]

Mr. Speaker, today's Liberal motion from the member for Markham—Unionville evidently is supposed to talk about the importance of a competitive and productive economy. However, before I continue I will briefly comment on the state of our economy.

Before I do that, I should acknowledge that I will be splitting my time with the member for Crowfoot, and I thank my colleague for that.

While there are always opportunities to do more, our economy is strong and we are focused. To illustrate this point, let me reference a few facts and figures.

We are experiencing the second longest period of economic growth in the history of Canada. Core inflation has remained within our set range of 1% to 3%. Our unemployment rate is the lowest in more than 30 years and there are more Canadians participating in the workforce than ever before in the history of Canada. We are reducing debt at a record rate. We are on the best financial footing of any country in the G-7 and we are the only country of the G-7 not having a yearly increase in the national debt.

As the latest CIBC World Markets Report stated that Canada had a healthy economic picture, especially when compared to our neighbours. It said:

For the first time in a generation, Canada is enjoying a major reversal of fortune versus the U.S., one characterized by superior economic growth, stronger job creation, outperforming asset markets and unmatched fiscal latitude.

Nevertheless, we must remain prepared for the challenges that confronts us. These challenges include: the significant rise in the Canadian dollar and its impact on the manufacturing sector; increased competition from emerging economic giants like China and India; and a shortage of skilled workers and an aging population.

We have a long term economic plan for Canada. It is a plan that will lead to a more rewarding future for Canadians and their families, including those families in my riding of St. Catharines. It is a plan to give Canada and Canadians the key advantages to compete effectively and attract new growth and further investment.

That plan is entitled “Advantage Canada”. Advantage Canada focuses on creating five key advantages: first, a tax advantage, reducing taxes for all Canadians and establishing the lowest tax rate on new business investment in the G-7; second, a fiscal advantage, eliminating Canada's total government net debt in less than a generation; third, an infrastructure advantage, building modern world-class infrastructure that promotes economic growth, a clean environment and international competitiveness; fourth, a knowledge advantage, creating the best educated, most skilled and most flexible workforce in the world; and fifth, an entrepreneurial advantage, reducing unnecessary regulation and red tape and increasing competition in the Canadian marketplace.

This plan has been praised repeatedly. For instance, the Canadian Chamber of Commerce said the plan was, “a great road map. It's got all the elements of things we need to do.” and that it recognized the importance of productivity to the long term health of our economy, business growth and Canadians' standard of living.

I can go further. The Canadian Federation of Independent Business also commended the plan noting that its “ focus is certainly the key issues that our members say should be focused on, whether it's debt, taxes, a skilled workforce or the whole red-tape and paper burden”.

How are we achieving the first of these advantages, the tax advantage? The government is building a business tax environment that is internationally competitive and neutral with respect to business and investment decisions. This is crucial for the right conditions for business to grow and to prosper.

Our government committed in our economic plan to make Canada's overall tax rate on new business investment the lowest, yes, the lowest in the G-7.

Since 2006, the government has taken a number of actions to enhance business tax competitiveness. We eliminated one of the most inefficient taxes, the federal capital tax, in January 2006. We eliminated the corporate surtax for all corporations, large and small, in 2008, thereby reducing their tax rates by 1.12%. We will reduce the corporate statutory income tax rate to 18.5%, by 2011, from 21% in 2007.

When a company builds a new building or an addition, it can write off the cost of that building within the useful life of that facility. We have aligned capital cost allowance rates with useful life. When companies invest in equipment within the building, they now can write down that investment within two years, instead of eight, ten or fifteen years.

It is not only the federal government that can provide tax relief to Canadian businesses. Provinces also have an important role in improving Canada's business tax competitiveness. To encourage further provincial action, budget 2007 put in place a financial incentive to work toward the elimination of provincial capital tax.

Canadians are already reaping the rewards of the first of these measures. Since the announcement of the measure to encourage provinces to eliminate their capital taxes as soon as possible, Quebec and Ontario have both acted to qualify for that incentive, and Manitoba has also announced its intention to do so.

Canada now has a solid statutory corporate rate advantage over the United States, and this advantage will just continue to grow through 2011. We are well on track to having the lowest overall tax rate on new business investment in the G-7.

The motion also highlights the importance of research and development. The government recognizes that private sector research and development is crucial for the long term growth and prosperity of our economy. The scientific research and experimental development tax incentive is a program that is one of the most advantageous in the industrial world. In fact, this incentive provided over $3 billion in tax assistance to Canadian businesses in 2006.

The scientific research and development tax incentive program plays, and will continue to play, a leading role in fostering a competitive and dynamic business environment in our country.

Other countries are not standing still and neither will we. We want to maximize the efficiency of our research and development incentives for Canadian innovators.

On October 5, the government launched public consultation on the scientific research and experimental development tax incentive program. These consultations, which are taking place as we speak and will continue through the month of November, up until November 30, will advance the government's long term economic plan to establish an entrepreneurial advantage. We want to create a business environment that unleashes private investment and a knowledge advantage by creating the best educated, most skilled and most flexible workforce in the world.

The consultations also provide the foundation for the government to fulfill its commitment in budget 2007, its science and technology strategy, mobilizing science and technology to Canada's advantage to identify opportunities for improving the scientific research and development tax incentive program to further encourage research and development within the business sector here in our country.

With Advantage Canada, our government has laid out a sensible economic plan to secure better paying jobs, solid growth and a bright future for Canadians. We have already taken action to implement this plan, but we will do more. As part of ensuring economic security for Canadians, our government will bring forward a long term plan of broad based tax relief for individuals, for businesses and for families. We will continue to make Canada more productive and more competitive.

To that end, tomorrow in the riding of St. Catharines a manufacturing company will be making a significant announcement as to its ability to do business in the Niagara region. One of the reasons is based on the fact that it will be able to take advantage and implement part of the manufacturing and business tax incentives included in the 2007 budget. Inside work, the equipment it needs to purchase to have that business function, will be written down over a period of two years, instead of ten or fifteen years. This speaks loudly, not only in St. Catharines and in Niagara but across our country, that our plan is working.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I listened closely to the member for St. Catharines. He talked about a sensible economic plan, but that is not what we have seen from the government thus far. We have seen it break its word on taxing income trusts, which has taken a little over $20 billion out of the incomes of investors, many of whom are seniors who depend on those investments. It took $20 billion out overnight and broke the trust of those individuals with the new government.

We see signs posted around Ottawa, Toronto, Calgary and Vancouver of the Prime Minister breaking his word on income trusts. Is he going to do anything to re-establish that trust with those individuals?

Second, the member talked about cutting taxes, but in the budget the government increased taxes for low income folks from 15% to 15.5%. Is the government going to roll back that tax increase so we can get to a sensible economic plan again?

[Rick Dykstra, Conservative, St. Catharines, ON]

Mr. Speaker, I appreciate the attentiveness of the member Malpeque during my speech.

His party's direction and understanding of income trusts is not something I really want to waste any time speaking about, because there is not one.

However, I will talk specifically to his question as to the foundation and the direction we are taking. Where the government will go and how it will benefit Canadians can be seen not only in the 2006 budget but in the 2007 budget.

Very shortly, over the next few weeks, we will have an economic update and a presentation by our finance minister, which will indicate where we stand as a country and where we will be able to go with respect to our economy.

So Canadians can have a clear understanding, we are able to make that stand based on the fact that we are moving forward on implementation of what we promised in our 2006 budget in terms of reducing taxes for Canadians, offering incentives and ensuring that we are reducing taxes for companies and corporations in our country. They have a trust and a faith that we are moving Canada in the right direction, and we will continue to do that.

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, I am glad we have this opportunity today to see the opposition motion come forward. It has shown to Canadians the great heated agreement that we have between the Liberals and the Conservatives over economic policy.

When we look at the issues that divide them, it is more about who in the corporate sector will get the money or who will get the breaks, rather than looking at the situation for workers and ordinary Canadians who have suffered over the last 15 years and saw the prosperity gap between them and corporations increase.

How does the member differentiate himself as a Conservative in economic policy from those of the Liberals? How do you do that? Do you work very carefully in fine detail to come up with that answer?

[The Acting Speaker, Conservative, Andrew Scheer]

I will assume the hon. member was asking the hon. member for St. Catharines how he does that, so I will let the hon. member for St. Catharines respond.

[Rick Dykstra, Conservative, St. Catharines, ON]

Mr. Speaker, I appreciate the question. It is very easy to determine in my opinion the difference between the party in opposition today and the Conservative party in government. It is simply this. When we make our commitments and we lay out very clearly what our commitments are from year to year, in the 2006 budget and our commitments in the 2007, we pay heed to the economy. We pay heed to ensuring that those in our country who deserve a hand up, not a hand out, get that. Every person has benefited from the 2006 budget. Every person has benefited from the 2007 budget.

We say what we will do, we put it in the budget and then we implement it. That is a big difference from the party opposite, which talks a lot. It had hundreds of priorities leading into the last election and did not complete one of them.

We stated five priorities and implemented them. Now we have stated another five long term priorities and we will implement them as well.

[Kevin Sorenson, Conservative, Crowfoot, AB]

Mr. Speaker, it is a pleasure to rise in the House on behalf of the constituents of Crowfoot and to speak against the opposition motion that has been brought forward to the House today. This motion is sponsored by the Liberal finance critic who consistently fails to recognize the strength of the Canadian economy.

Our economy is rock solid. In fact, Canada is the only G-7 country with budget surpluses and a falling debt burden. Employment is up, unemployment is at a record low. Taxes are lower for families, individual Canadians, as well as for businesses. In short, the future looks bright.

No doubt some of the hon. members across the floor may be asking themselves how this Conservative government has accomplished so much in such a short time. I will tell the House how we have done it. We have done it because, through the Prime Minister and the finance minister, the government has brought forward a plan and it has stuck to the plan. I am talking, of course, about Advantage Canada, this government's long term economic plan for Canada's future, a plan that is built on the foundation of solid fiscal management with the aim of achieving key advantages for Canadians.

What do these advantages entail? They include a tax advantage toward which we have already realized significant results; over $41 billion worth of tax cuts over three years for individual Canadians and businesses.

Over the summer, throughout my constituency of Crowfoot many people would stop by my vehicle when I was on the main streets of different communities to share their views and opinions about the performance and the direction that this Conservative government was going. They encouraged me to take the message back to Ottawa and to our Prime Minister that they wanted us to continue to reduce taxes because, in their opinion and in my opinion, we still pay too much in taxes.

I assured my constituents that we would continue to reduce taxes for all Canadians. We are about to establish the lowest tax rate on new business investments of the entire G-7 nations.

Advantage Canada also has a fiscal advantage. It makes debt reduction a priority. I had the opportunity of speaking on that earlier today. This is a priority for a lot of members of Parliament on this side of the House who came here believing that the close to $600 billion debt was far too high. We will continue to reduce Canada's debt load because it is a debt that will be a burden to our children and grandchildren. In fact, our plan is to eliminate Canada's total government net debt in less than a generation, and we are well on our way to accomplishing that.

As the Minister of Finance pointed out, we have reduced the federal debt load by more than $27 billion over the last two years. That amounts to $1,100 for every man, woman and child that the national debt was reduced over the term that this government has been in power.

Let us not forget our tax back guarantee, a guarantee that provides a direct benefit to Canadians by dedicating all interest savings from the federal debt to further reduce personal income taxes. To date, we have provided Canadians with over $1.5 billion in personal income tax relief as a result of paying down the debt and as a result of the tax back guarantee.

The third component of Advantage Canada and one that has not had a lot of recognition here today is the commitment to create an entrepreneurial advantage. To that end, the government is reducing red tape for businesses to help create an environment for Canadian businesses to prosper. There is still work to do but our commitment is firm.

For example, the government is committed to its goal to reduce the paper burden on business by 20% by November 2008.

Our government has also set its sights on building a knowledge based advantage. This includes implementing a labour market training system that ensures Canadians get the training and the skills they need to get a good job, a job with a future.

In short, we want to help the country create an education system that brings forward the most skilled and most flexible workforce. If we are to be productive and competitive in a world with a global economy, we need to recognize that our labourers need to be top skilled labourers, and they are that.

Finally, the Advantage Canada plan will create an infrastructure advantage. We have spoken about infrastructure a fair bit today, a modern, world-class infrastructure Canadians can be proud of. In order to complete on a global scale, we need to build the modern bridges, the roads and the gateways necessary to get our goods to the market.

Contrary to what some in the other parties realize, our markets are not just domestic markets. Our markets are around the world, whether it be agriculture or whatever, and we must be certain that the products get to market.

Where do we go from here?The Speech from the Throne laid out a very clear direction in which we would go, a plan that we have committed to. We have said that we are committed to working with other Canadians to build a nation that is a model for the rest of the world. To meet this commitment, the Government of Canada's vision for Canada has five core priorities: first, strengthening Canada's sovereignty and place in the world; second, strengthening the federation and our democratic institutions right here at home; third, providing effective economic leadership for a prosperous future; fourth, and one on which I receive calls in my riding every day, tackling crime and strengthening the security of Canadians; and, fifth, ensuring that our environment is looked after, improving the environment for the health of all Canadians.

The throne speech that was delivered only a little over a week ago highlights our commitments to support a wide range of economic activity across the country.

Today, when I read the motion put forward by the opposition across the way, there was not one mention of agriculture. We hear very little from the opposition, from the Liberal Party or from the NDP, about agriculture.

The throne speech recognizes the importance of the agricultural sector in Canada. We have listened to the ideas and concerns of farmers. We have listened to the stakeholders and we have listened to the consumers.

At their meeting in June, the ministers of agriculture endorsed growing forward, a policy statement incorporating a bold, market driven vision for Canada's agriculture, agri-food and agri-based products industry. It will guide the development of federal-provincial-territorial programming in the industry. This program is a collaborative, forward focused vision for a profitable and competitive agriculture sector.

Much can be accomplished in agriculture and Canada's agriculture industry will benefit from this government's promotion of, for example, the biofuel initiative that we have put forward.

We have seen and we see now commodity prices at close to, not an all-time high but a remarkable level of dollars for the product that we are producing. Canola is at over $9 a bushel. Wheat is starting to creep its way up. Barley is at $2.50 a bushel, which does give concern to the feed industry, but there is an optimism out there that I have not seen for years, an optimism that producers can continue to have because we have a government that is listening to the concerns of the agricultural community. We realize that we must have strong, solid trade around the world which is why we have ongoing trade negotiations.

This not just talk. This is a government that takes action and we have taken decisive action to build on the foundations of our successes.

As I said, our economy is strong, the fiscal fundamentals are in place and we have an ambitious plan, Advantage Canada, that will take us where we want to go. We have chartered a prosperous course for Canada's future and we will stick to it.

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

Mr. Speaker, the hon. member talked a great deal about cutting back and all kinds of great things. I suppose the GST was also reflected. What he did not mention, though, was the social and environmental debts. Those are very real debts.

All five economists in today's papers said clearly that the GST cut was absolutely the wrong and worst idea and that it will do nothing for business and nothing for people. Does the hon. member know, or does he not want to listen, that according to the Canadian Centre for Policy Alternatives, 86% of Canadians want us to work on the growing gap between the have and have nots or the poor; that 49% of Canadians say that they are two missed paycheques away from poverty; that 85% of Canadians want government to tackle poverty; that 90% of Canadians want affordable university and college tuition; that 85% of Canadians want affordable housing for low income people; that 80% of Canadians want affordable quality child care; and that 80% of Canadians want the minimum wage raised? We are wasting capital by cutting the GST.

Would the hon. member tell me how we will address these very real issues of Canadians who are on the margins, whose incomes have not increased realistically in 15 years when we have had 15 years of sustained economic success with huge surpluses, huge surpluses that you are throwing away on a cut to the GST which will do nothing for our economy, social well-being, environment or the poor in our country.

[The Acting Speaker, Conservative, Andrew Scheer]

Order, please. I will just remind the hon. member for Beaches—East York to address questions through the Chair, not directly to other members.

The hon. member for Crowfoot.

[Kevin Sorenson, Conservative, Crowfoot, AB]

Mr. Speaker, the government has been very clear in saying that we will bring forward a long term plan for tax relief. We will bring forward a long term plan that not only will affect those who are being taxed through personal income taxes, but for everyone who purchases anything in the country, we want to ensure that tax relief happens.

The member stood in the House and talked about how that economist and that banker did not like the idea of a GST cut, but what did Canadians say? What do Canadians believe? The calls coming into our offices are from single moms who say that every time the GST is cut more money is being put back into their pockets.

As we continue to move forward with tax reduction, the biggest threat to our social network is the heavy burden of debt and overtaxation. The worst thing that can happen, when we are overtaxing those who are working the social programs, is that they can fall.

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

Mr. Speaker, if the hon. member wants to get into semantics, I noticed that in his speech he never once mentioned shipbuilding, fisheries or veterans. He talked about the environment. The reality is that the government authorized the midwater trawl off the coast of Prince Edward Island. Only an insane person would allow that type of fishing activity in those sensitive grounds.

Also on shipbuilding, the shipbuilding industry has been asking for years, along with industry and labour, the two groups together, for accelerated capital allowance and structured financing for up to a five year period. This is business and labour asking the government to do that. If we were to do that, our yards could then be competitive internationally. We still have not received a commitment from the government to do that.

He talked about Advantage Canada. What about advantage for veterans in the country? The government made three distinct promises and broke them all: the claw back on their pensions under SISIP, the VIP promise that the Prime Minister made to a widow of a veteran, and the Agent Orange--

[The Acting Speaker, Conservative, Andrew Scheer]

The hon. member for Crowfoot.

[Kevin Sorenson, Conservative, Crowfoot, AB]

Mr. Speaker, I would like to apologize to all the shipbuilders. I did not touch on that in my speech.

We did have the accelerated capital cost allowance in the budget and the member stood and voted against the very things for which industry is asking.

I happened to serve with the member for Edmonton—Leduc on a committee. The committee brought forward a report on industry with 22 recommendations. The report was brought forward in March. The government responded favourably to 21 of those recommendations. Members must give the government time. The Canadian people want this government to be in power so that we can continue to fulfill the priorities that we have listed.

[Garth Turner, Liberal, Halton, ON]

Mr. Speaker, it is a pleasure to participate in this debate today. I would like to mention that I will be splitting my time with the hon. member for Churchill.

As many of my friends opposite will know, when the last election campaign took place, I was not a proud member of the federal Liberal Party. I actually campaigned as a member of the Conservative Party and I spent a considerable amount of time knocking on doors. In fact, I actually knocked on around 25,000 doors over the course of eight or nine months during my campaign.

As I was knocking on doors, I had a great opportunity, of course, as other members do, to actually talk to individuals and families in their homes and find out what they cared about. I found that many people in my particular riding had not elected a Conservative since 1993. In fact, I was the last Conservative to represent that riding and there I was in 2005 campaigning again.

I found there was hesitation among people in the riding about the current Prime Minister. They did not mind the Conservative brand from what they knew from the past, but they had a few reservations about how this new Conservative Party would actually pan out. When people raised these questions with me I said, “Don't worry. I can assure you, my friends, that this new Conservative Party will be moderate, mainstream, middle of the road, and at its very core it has concerns about the economy, good economic management”.

I told people, “Don't worry, this party gets it. It understands the pressures that families are under today, it understands the concerns that people have about rising taxes. It is the party of prudent spending and economic management”. I said that and I did not give people any hint whatsoever as to what they could end up expecting.

What did they find? They found higher income taxes. No one told me about that when I was a Conservative candidate. Nobody told me to go to people's doorsteps and say, “If you vote for me, I will raise your income taxes”.

When I knocked on doors I had something called “Stand up for Canada”, which had a section in it called “Security for Seniors”. In that section it said, “We will not make life harder for senior citizens, senior investors”. I knocked on their doors and when they asked me, “Are you guys going to look after our savings”, I said, “Absolutely. The prime minister to be gets it. This new Conservative Party understands”. I did not tell them that we would go back as Conservatives and rob their savings.

When people said to me, “I have all my money in my house. Do you understand that? Do you guys understand that the repository of net family worth in this country is now residential real estate? Do you get it”, I said, “Absolutely. We will pursue prudent economic management policies that will not be inflationary, that will not trigger the Bank of Canada having to raise its key lending rate, which will translate into you having a higher mortgage rate”.

They asked me about inflation and I said, “Don't worry about that. There is no way that I think this government is going to overspend. This is a Conservative government, not like those Liberals over there who know how to mind the dollars. They will not overspend”. At the end of the day, I would have trouble going back to those people if I were a Conservative. I would have had serious trouble going back. I would have to say to those people, “I basically lied to you. I basically told you that the economic situation would be handled when it was not”.

I want to run through a couple of points before I get to some solutions because that is what Liberals are all about. We are about solutions. We are about solving problems. We are about giving people a sound, bright economic future. That is what everybody in the House ought to be concentrating on, not hurling mud.

I have to say a few things about what has happened regarding government spending. To me, there is nothing that represents failure on the part of government more than governments who overspend. It is a crime. I never thought I would see a Conservative government spend the way it is spending.

The government is spending more money in the current budget and projected in next year's budget than any other government in Canadian history, of any flavour, of any stripe.

In fact, government spending right now is increasing by double the inflation rate. That is a pretty serious issue. The consequences of that are extremely clear. When government spending is increasing by double the rate of inflation, it ends up itself being inflationary.

The government accounts for a significant part of GDP. As that happens it triggers an increase in the core inflation rate. As all hon. members know, the Bank of Canada tries to maintain an inflation rate of between 1% and 3% and right now we are at the top of that and bumping over. Economists agree that a very significant part of that is government spending.

As the Bank of Canada increases its inflationary range and exceeds it, then it has to have interest rate increases. Those interest rate increases are now impacting on families because they have also inflated our currency. Our Canadian dollar's rise to parity is certainly influenced by the inflationary tendencies we have seen from government spending and the Bank of Canada.

Now there is more pressure on families because mortgage rates are rising. In fact, key mortgage rates went up by half a point just a few days ago. With the record level of mortgage debt in this country with Canadians never having been as indebted as they are today, a half point increase in mortgage rates actually matters. It matters to people in my riding. In the 905 area, where houses are expensive, a half point is a big deal, and it need not have happened. It was fueled by the Conservative government. That is one pressure on families in my riding.

A secondary pressure on families is taxes. When I was knocking on doors in my constituency, I never told my people that their income taxes were going to rise because I did not believe it. The basic income tax rate in this country dropped to 15% in November 2005 in the last Liberal budget. I never imagined that a Conservative Prime Minister and a Conservative government would actually raise that, but they did.

People ask me why I am upset because it is only half a point. A half point increase in the bottom income tax rate translates into $2.8 billion. That is $2.8 billion that we are taking right out of the hides of Canadian taxpayers and sending to Ottawa. I do not think that is what any of them actually bargained for or voted for.

Then of course there are the 2.2 million seniors who owned income trusts. We know that story so I will not go over it in detail.

I went to a rally in Burlington, Ontario, as a Conservative candidate during the 2005-06 election campaign. I stood right behind the Prime Minister as he stood at the podium. He looked into the teleprompter and promised once again that he would never tax income trusts, and he did. Some $20 billion in the value of retirement savings, the capitalization of income trusts, basically vaporized because the income trust had been decimated by that commitment to tax it. Shame.

Also, and perhaps more significantly, $26 billion worth of Canadian companies have been sold, many of them to foreign interests, because they were worth pennies on the dollar because of the income trust decision.

Worse still, the Government of Canada said it was going to raid seniors' investments and take their income trusts because it was afraid of tax leakage. It did that because we have a robust income trust sector in Canada and the Government of Canada would see fewer dollars in terms of revenue. What has happened a year later? We know the facts. The Government of Canada suffered a $900 million tax loss because of the disappearance of these companies.

This is not all about problems; it is about solutions. We are also about solutions. Obviously, with an electoral campaign being forced upon us by the Conservatives, which will be here shortly, our platform will be revealed.

We do not believe that the GST cut is necessarily the best way to deliver the next tax cut. We think it is best through broad-based income tax cuts, which will put more dollars in the pockets of families.

Second, we want less government spending. With less government spending, we will have a drop in interest rates and that is definitely going to help families.

Third, we want an industrial strategy that addresses seriously foreign takeovers and also helps the automobile sector. Included in that is a corporate tax cut.

Fourth, we want broad based family tax reform and reductions. There is a number of things that we will be proposing there. Also, we have a demographic time bomb in this country with many people who today are truly going to need the kind of help the Liberal Party is offering.

[Gord Brown, Conservative, Leeds—Grenville, ON]

Mr. Speaker, I welcome this opportunity to stand up and talk about the fact that the Conservative government has been spending money on Canadians' priorities, such as cleaning up our environment. I know that is something that is very important to Canadians. The government has been spending money on infrastructure, something to help rebuild our communities after many years of neglect on the infrastructure file.

I listened intently to the comments of the hon. member for Halton. I know that something that is very important to him and is very important to me is working toward having pension income splitting in our country. I know that is something that was in budget 2006. I know it was something that was important to the member for Halton, yet when he was given the opportunity to vote for something that he had spent a great deal of time working for, he voted against it. That is something I would like the hon. member for Halton to explain to me and to this House.

[Garth Turner, Liberal, Halton, ON]

Mr. Speaker, my friend across the way--

[Ted Menzies, Conservative, Macleod, AB]

Tell us.

[The Acting Speaker, Conservative, Andrew Scheer]

Order, please. The hon. member for Leeds—Grenville asked a question. Some of his colleagues are interrupting the hon. member for Halton's response.

I am sure the hon. member for Leeds—Grenville wants to hear the answer to his question. If members would let the hon. member for Halton do so, we will continue.

[Garth Turner, Liberal, Halton, ON]

Thank you, Mr. Speaker. They needed that.

My friend across the way is quite right, I did campaign long and hard for income splitting, the first part of it being pension splitting. It is an economic justice and an economic reform that was probably too long coming, but eventually it came.

I do actually thank the member opposite who raised the question because I know he was a proponent when I brought this issue up when I was on that side of the House. He was helpful and supportive on that, as were many of the members sitting over there. I thank them very much for doing that. It was the right thing to do.

I also thank the Minister of Finance. He did the right thing as well by bringing in pension splitting. I will say that quite clearly, this is a reform that we needed and many people on this side of the House, in fact many people on all sides of the House supported this.

What we did not support on this side, what we did not expect, and what shocked us was the betrayal that the Prime Minister showed and the Minister of Finance when they brought in a tax on income trusts. We never thought that would happen because the Prime Minister told us it would not. I mean we foolishly believed him. We believed the man. So we could not understand, nor could we support, any legislation that was bundled with a pension sharing that also robbed seniors of more money than they would ever get in their lifetime--

[The Acting Speaker, Conservative, Andrew Scheer]

Questions and comments, the hon. member for Vegreville—Wainwright.

[Leon Benoit, Conservative, Vegreville—Wainwright, AB]

Mr. Speaker, I have listened today as people have expressed different opinions on the issues and I have sat here listening and thinking this is a different opinion, that I do not agree with it, but that is fine.

However, this member has the nerve to stand here today and say he did not vote to support income splitting on pensions because of the tax on income trusts, and yet he voted for the Conservative government's income trust motion. He said this on his web page. He says on his own web page: “My vote will acknowledge that wholesale corporate conversions to trusts are unhealthy”.

That is what he said on his own web page, exactly the opposite to what he is saying right now. He went on to say: “Reforming the trust business and stemming the tide of conversions is necessary for the long term health of the economy”.

That is what he said then. Today he says something entirely different. This member has no credibility whatsoever. I have listened to others and accept different opinions, but this member has no credibility. He says one thing one day, another thing entirely the second day.

[Garth Turner, Liberal, Halton, ON]

Mr. Speaker, I thank the hon. member for the opportunity to mention my website which is www.garth.ca. There, one will find a very stimulating discussion going on.

In answer to this, I think anybody who knows anything about the economy certainly knew that the income trust sector needed some more regulation surrounding it. I certainly had proposed some ideas in that regard.

I do not think that anyone ever expected that the Minister of Finance would bring in a tax holus-bolus that would destroy the industry and erode so many savings.

I did vote for the motion for pension splitting, absolutely. I thought it was one of the most fraudulent, politically manipulated moves I have ever seen in my entire life, to have that pension splitting provision, which we all would have supported, bundled with an income trust tax which the Prime Minister betrayed us on. To put those two things together was fraudulent and the government ought to be ashamed. Shame.

[Tina Keeper, Liberal, Churchill, MB]

Mr. Speaker, I acknowledge my colleague for his speech today. It is an important speech and it is important that we have this member in our caucus now. Part of the excitement in the House may be because he does have a conviction around these issues. That is important for Canadians to hear.

I am especially pleased to participate in this discussion today, this opposition day motion, because we are talking about what affects all Canadians. It certainly affects my riding and people within my riding.

I represent a large rural riding. There are dozens and dozens of communities in my riding. Those communities include two cities and dozens of towns and first nations. When we talk about the economy and all the measures that affect Canadians, we look forward to creating a vision that will respond to all Canadians.

What are we talking about in terms of social impacts and people? We have heard that from some of the members. In fact, a member talked about people at the door, what they talked about and how they felt.

One of the major concerns I hear from the people in my riding is the disparity gap between Canadians. We are talking about income equality, the gap between the rich and the poor. What is the reality check? That this has been growing faster in the last decade than at any time in the last 30 years.

In 2004 the richest 10% of Canadian families, raising children under 18, earned 82 times more than the poorest 10%. In fact, the after tax gap is at a record high. We talk about unemployment being at a record low, the lowest in 30 years. However, this is at a record high, the highest it has been at any time in 30 years.

These are the concerns of Canadians, 65% of whom say they are not benefiting from economic growth. They feel income and wealth are getting concentrated at the top and so is power, leaving too many behind.

I thank the member for Markham—Unionville for his leadership in putting forward the motion today. It speaks to the continuation of the modern Liberal Party's history and leadership of fiscal responsibility.

When the Liberals took office in 1993, they inherited a disastrous financial picture from the previous Conservative government. Canada was a country with enormous debt and it was completely out of control. Our nation was at the point of a national fiscal crisis and the future appeared bleak.

Fortunately, through the 1990s and through decisions which were very difficult and tough to make, the Liberals delivered budget after budget of sound fiscal planning by consistently paying down the debt. Canada soon became a model for fiscal responsibility on the international stage, with the best book at the G-8. Most other advanced industrial countries began to take notes from our Liberal policies.

On the other hand, getting Canada's debt under control was and still is a priority for Canadians, and it continues to be a fundamental priority for us.

As a result of the measures taken by the past Liberal government, Canada is now in an ideal state to strengthen Canada's competitiveness with new investments to drive greater Canadian productivity.

What are we talking about? We are talking about physical infrastructure and new technologies, particularly green technologies. For the members opposite, that has to do with environmental responsibility. The government has the ability to provide the leadership on environmentally friendly investments through tax incentives and public-private partnerships.

I represent a northern riding, and I know I said that before. However, the environment, before it even hit the national agenda, was a priority in my riding.

Shortly after I was elected in January of 2006, I polled and surveyed the riding, and the environment was the number two concern of the people in the Churchill riding. That is because they live with the day to day impacts of global warming. The winter we campaigned was the warmest winter on record. People in my riding were well aware of that. They live on the land and they play on the land.

We also need to be making investments in research and development.

One of the members mentioned poverty. I do not know if I have ever heard that word from across the House. We talk about an anti-poverty campaign. How are we going to do that? We have to invest in our children. We have to invest in the future. We have to invest in the minds of the youth in our country.

We are talking about research and development and post-secondary education. If the Conservative government would actually listened to Canadians, it would hear the need for investment in training and enhancing our skilled workforce.

I am not alone in the House, representing a northern riding. Many of us have booming economies in mining and hydro development, yet we have a shortage of a skilled labour force. We do not even have the ability, as a country, to meet the aged-out population. As these baby boomers start to retire, we do not even have the ability to fulfill that labour market.

The government must invest in our youth. The government must lower corporate taxes, which will allow businesses to reinvest in new capital, while attracting fresh foreign investment in new business. We are fortunate to have a healthy and productive workforce in Canada.

With this in mind, the government must take responsibility and leadership to foster an environment that will enhance the opportunity to provide all Canadians with a strong future. In the era of budgetary surpluses, brought in by sound Liberal policies, Canadian families must reap the direct benefits through personal tax cuts. We have heard that many times today, yet the Conservative government raised personal income taxes.

The government must be held accountable and produce responsible and consistent policies. Unfortunately in this respect, the financial record of the Conservatives has been appalling. After attempting to hold themselves as the party of accountability, they broke a critical promise to seniors. In my riding, I had constituent after constituent write in about the income trust fiasco. This was a promise they had made to Canadians and it was a promise broken.

After people working their entire lives, pinching pennies and saving for their retirements, the Prime Minister and the Minister of Finance went back on their words and announced the decision to tax income trusts. The decision wiped more than $25 billion in savings overnight from Canadians across the country. The Conservative government took advantage of the elderly. Canadians invested their money based on this promise and people's trust cost them.

The approach from the members opposite is dishonest and reprehensible, and the constituents in the Churchill riding deserve better. They deserve strong leadership and responsible government.

While claiming to speak for families, workers, the environment and Canada's aboriginal peoples, the past 20 months has resulted in cancelled child care agreements, a flawed softwood lumber deal, scrapped environmental programming and a death sentence for the Kelowna accord.

There is a need for a reality check by the government. I invite all members of the House to support this motion. I invite them to stand up for students, workers, families, northerners and women.

[Ed Fast, Conservative, Abbotsford, BC]

Mr. Speaker, I appreciated working with the hon. member on the heritage committee. I know she is very knowledge about heritage issues, having being an actress on CBC Television. However, I want to focus on something that she did not mention.

The Liberal opposition in the House has opposed our proposal to cut the GST even more. We had committed to cutting it by 2%, and we hope to achieve that shortly. The Liberal Party is opposed to reducing the GST, yet she knows the GST is the one tax that applies to all Canadians, including the 30% who do not pay income tax.

The member was critical of us for not reducing income taxes, yet a reduction in income taxes would never apply to the 30% who do not pay taxes, which includes Canada's poor. She mentioned that her riding has a significant number of people who are below the poverty line. Surely she would want to help them by reducing the one tax that would impact them.

Could she explain to the House how her party opposes GST cuts and prefers to reduce corporate taxes and the taxes on the rich?