Mr. Speaker, I am very happy to take part in this debate on the motion introduced today by the Bloc Québécois.
I am sure that this has already been done, but I would like to read the motion.
That, in the opinion of the House, given that the Prime Minister has promised to eliminate the fiscal imbalance and that this imbalance cannot be eliminated without the elimination of the federal spending power in areas that fall under the jurisdiction of Quebec and the provinces, the bill on federal spending power that the government will introduce should, at a minimum, provide for Quebec to have the right to opt out with no strings attached and with full financial compensation from any federal program, whether existing or not and cost-shared or not, which invades Quebec's areas of jurisdiction.
As my colleague from Beauséjour said earlier, the Liberals and, I believe, most Canadians, including the people of Quebec, will never be able to agree to eliminate federal spending power. Limiting or regulating federal spending power is quite another matter.
I believe that the work the former Liberal government did to negotiate with all the provinces, including Quebec, and the three territories in order to reach an agreement on how the federal government could spend in areas of shared or provincial jurisdiction—the social union agreement—is an excellent example of how Canadians saw a government tackle this issue so that when it comes to social programs, people across Canada will be entitled to equivalent services, no matter what province or territory they live in.
The social union framework agreement went a long way toward strengthening the national social measures that matter to all Canadians, including Quebeckers. I am thinking of measures such as health insurance. It was also vital in promoting equal services for all Canadians, no matter where they live.
Recently, this framework agreement was crucial to the successful negotiation of agreements on early learning and child care with the provinces and territories, agreements that the current Conservative government threw out. The Conservatives discarded these agreements, depriving millions of children and families of billions of dollars.
The Liberals will not allow the current Prime Minister to create a compartmentalized federalism or to sit back idly and give Quebec separatists any ammunition. I heard a member of the Bloc Québécois say there is a strong consensus in Quebec on, first of all, the fiscal imbalance and, second, on the complete elimination of the federal spending power. This is interesting, because the consensus, which was reached in the National Assembly, was based on the Séguin report. Mr. Séguin is a prominent economist, well known in Quebec and throughout Canada. It would be interesting to see what the Séguin commission reported and concluded in its report as a result of the consultations held throughout Quebec regarding the fiscal imbalance.
It is interesting to note what the Séguin commission proposed to correct what it identified as the provincial fiscal imbalance—it made no reference to the federal side, even though Canada's national debt is far greater than the combined debt of all the provinces and territories. Indeed, the federal government's revenue is much lower than the combined revenue of all the provincial and territorial governments. Yet, that is a separate issue. I have no desire to debate the issue of whether or not there is a provincial fiscal imbalance.
The Séguin commission concluded that the solution to the fiscal imbalance lies in transferring tax points. It also proposed some other possible solutions, such as transferring the value added tax, commonly known as the GST, from the federal government to the provinces.
I would like to quote an excerpt from page xii of the Séguin commission's March 2002 report.
The Commission expresses its preference for an occupation of the GST field by the provinces. In light of the financial objective adopted, the federal government should entirely relinquish the GST in favour of the provinces. However, the Commission does not wish to reject the scenario calling for a new division of the personal income tax field.
Of course, the fact that the federal Conservative government has already reduced the GST by 1% without the Quebec government raising its own sales tax, the QST, to take advantage of the tax room thus created, and to reduce the so-called fiscal imbalance, undermines the Bloc's argument.
Again, the Quebec government had the opportunity to use the tax room created by the federal Conservative government when it reduced the GST by 1%. If it had really believed that a fiscal imbalance existed, the Quebec government could have increased the QST immediately in order to occupy the tax room that had been created. But it did not do that. It is interesting to note that the Bloc never mentions this fact. It does not mention that the Séguin commission said that it preferred that the GST be used as a tax field to deal with the so-called fiscal imbalance. But the Bloc never makes mention of this.
We must look at what sources of revenue are available to the provinces. As I already mentioned, there is the tax on the sale of goods and services. In Quebec, this is the QST. But there is also the personal income tax. This is the tax that people pay as a percentage of their income, which may include their salary, pension, investments and property income.
The federal government has access to the same sources of financing or revenue. However, the provinces have other sources not available to the federal government, such as lotteries, royalties on natural resources, and taxes on the sale of alcoholic beverages.
The federal government does not have access to any of these fields of taxation. In my opinion, the provinces are in control of their destiny and can use these tax fields as they please, in order to provide their citizens with the services that they are entitled to, under the sharing of jurisdictions provided by the Constitution.
I thank hon. members for listening to my remarks.