House of Commons Hansard #135 of the 39th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was budget.

Topics

Budget Implementation Act, 2007Government Orders

3:30 p.m.

NDP

The Deputy Speaker NDP Bill Blaikie

The hon. member has asked for the unanimous consent of the House. Is there unanimous consent?

Budget Implementation Act, 2007Government Orders

3:30 p.m.

Some hon. members

Agreed.

No.

Budget Implementation Act, 2007Government Orders

3:30 p.m.

Conservative

Garth Turner Conservative Halton, ON

Mr. Speaker, can I wrap up now?

Budget Implementation Act, 2007Government Orders

3:30 p.m.

NDP

The Deputy Speaker NDP Bill Blaikie

No. Your time is up. Questions and comments, the hon. government whip.

Budget Implementation Act, 2007Government Orders

3:30 p.m.

Prince George—Peace River B.C.

Conservative

Jay Hill ConservativeSecretary of State and Chief Government Whip

Mr. Speaker, I will not take all the time. I am sure there are other members who would like to question this particular member.

Throughout his intervention, he used some very strong language. He said “despicable” and implored the necessity to tell the truth, if I heard him correctly.

This particular member, as I recall, said that he would resign his seat before he would turn to another party. He said that there should be a process in place in the House that members should not be allowed to change political stripes during a Parliament. Yet, we find that he is still here. He is still sitting here.

I would ask, why? If he is so insistent that people tell the truth, what about himself? Why did he not tell the truth and resign his seat?

Budget Implementation Act, 2007Government Orders

3:30 p.m.

Conservative

Garth Turner Conservative Halton, ON

Mr. Speaker, Mike from Rodney says, “You personally promised that you would not let other parties get away with taxing income trusts. Silly for us to assume that you condemned other parties for a promise your party was not willing to do”.

Another comment states, “Mr. Harper, Mr. Flaherty and the remaining Conservative MPs: you placed our country in jeopardy with your policy regarding income trusts, changes in interest deductibility and withholding taxes for corporations. Something--

Budget Implementation Act, 2007Government Orders

3:30 p.m.

NDP

The Deputy Speaker NDP Bill Blaikie

Order, order. There has to be some intimation of relevance and the member is perfectly in order, except he is not in order when he keeps using the names of ministers in the context of the letters.

So we will go to the hon. member for Burlington.

Budget Implementation Act, 2007Government Orders

3:30 p.m.

Conservative

Mike Wallace Conservative Burlington, ON

Mr. Speaker, I think the hon. member for Halton has missed his calling. He treats this place as a theatre and does not take the issues seriously. He is obviously playing for the television.

Here is what I want to ask. First, on November 7 did he or did he not vote for the Conservative government's income trust motion?

Second, “my vote acknowledged that wholesale corporate conversions to trusts are unhealthy”. Is this true or not that these were his words on www.garth.ca on November 6, 2006?

Third, “reforming the income trust business and stemming the tide of conversions is necessary for the long term health of this economy”, again on his website and spoken by him. Is this true or not? Did he say it?

Fourth, “too many new conversions, lost tax revenues, unfairness in corporate tax treatment, money leaking to foreign investors, the threat of the banks morphing into trusts, the writing was on the wall--

Budget Implementation Act, 2007Government Orders

3:30 p.m.

NDP

The Deputy Speaker NDP Bill Blaikie

Order, please. The hon. member has managed to get three and a half questions in and we have only got a little time left.

The hon. member for Halton.

Budget Implementation Act, 2007Government Orders

3:30 p.m.

Conservative

Garth Turner Conservative Halton, ON

Dwight from Chatham says:

The blackening-out of the purported rationale by the Finance Department during the FINA hearings was a shock to me. This was then coupled with the hiding of the bill inside the budget so that no discussion was possible. These actions appear to cover up the guilty knowledge that the true facts could not stand up to public scrutiny.

Harold says:

In view of the Prime Minister’s explicit election promise never to impose a tax on income trusts, and the fact that this promise undoubtedly gave existing and potential trust investors a high degree of comfort, why did the Minister of Finance not take one of the many routes available which would still have accomplished his aim without destroying massive amounts of--

Budget Implementation Act, 2007Government Orders

3:35 p.m.

NDP

The Deputy Speaker NDP Bill Blaikie

Order, please. One last question by the hon. member for Sault Ste. Marie.

Budget Implementation Act, 2007Government Orders

3:35 p.m.

NDP

Tony Martin NDP Sault Ste. Marie, ON

Mr. Speaker, I admire the member's ability and effort to hear from constituents using the various technologies that are available today. He is probably in some ways way ahead of his time.

I was wondering if in his reaching out to his constituents and asking them to comment on the budget if he went beyond income trusts. Did he hear anything from seniors, for example, who are by the hundreds of thousands not getting their entitlements because the government has not acted on recommendations to change the way that information is disseminated, re-entitlements to seniors, and seniors themselves having to actually apply and then become automatically qualified for things like CPP, OAS and GIS?

Budget Implementation Act, 2007Government Orders

3:35 p.m.

Conservative

Garth Turner Conservative Halton, ON

Yes, Mr. Speaker. Actually, all the people I am quoting right now are seniors. For example, Dave Marshall and his wife in Cornwall, Ontario say--

Budget Implementation Act, 2007Government Orders

3:35 p.m.

NDP

The Deputy Speaker NDP Bill Blaikie

Resuming debate, the hon. member for Vancouver Island North.

Budget Implementation Act, 2007Government Orders

3:35 p.m.

NDP

Catherine Bell NDP Vancouver Island North, BC

Mr. Speaker, I would like to begin my remarks today by painting a picture for my hon. colleagues about how this budget fits into the overall course that Canada seems to be taking under this Conservative government. This course is guided by its not so obvious agenda and if members read between the lines, they will see that it is there.

This agenda is also driven by five priorities: one, help the rich get richer and pretend the prosperity gap does not exist; two, privatize at all costs, including municipalities and their infrastructure; three, treat first nations with disdain and ignore their advice; four, invest as little as possible in social programs, no matter how big the surplus; and five, ignore the crisis situation in the forestry sector.

This Conservative agenda masquerades behind what it likes to call the harmonization of inefficiencies. This language is often used by the right as a kind of code. To the rest of us, harmonization of inefficiencies loosely translated means the alteration of policies to the benefit of rich corporations and to the detriment of ordinary Canadians.

This policy change ignores the ever-increasing prosperity gap, environmental conditions, food safety concerns, health care services and the control of our natural resources. Furthermore, this budget offers deep integration with the U.S. at the cost of our sovereignty.

This agenda of privatization by stealth has been going on for many years. This path has seen the rich get richer and the rest of us get the leftovers.

This budget is nothing short of deceiving. While the Conservatives beat their chests about standing up for Canada, their actions suggest quite the opposite to hard-working families. While they talk about a stronger Canada, they intentionally attack our public institutions; thereby, eroding the foundation of an independent Canada.

Allow me to elaborate more clearly what I believe the government's real priorities are. Priority number one: ignore the widening gap between the super rich and ordinary Canadians.

Surplus after surplus of hard-working Canadians' taxes have gone to tax cuts for large corporations. These surpluses subsidize the development of the oil sands at a time when the industry is making record profits. It gets to continue to receive subsidies until 2015. That is six years before it even starts to see a phase-out. But no money from the federal budget went to the thousands of Canadians whose families are looking for affordable housing.

In fact, affordable housing was not even mentioned in this budget. So, how is it that a profitable corporation can continue to receive subsidies but ordinary families are ignored? The gap between the rich and the poor in this country is widening and this government has no plan to correct it.

Priority number two: use privatization as a mantra for change. How do we start the process of privatization? First, we need to set up shop.

On page 162 of the budget, it states this government will, “establish a new federal office to identify and implement opportunities for public-private partnerships in infrastructure”.

Step two, then we have to make it mandatory. On page 169 of the budget, it goes on to state that municipalities, “seeking funding...will also be required to demonstrate that the option of undertaking the project as a public-private partnership has been fully considered”. This is simply bad policy and a waste of Canadians' money.

We have seen the experience of public-private partnerships when companies take over a public project. The focus shifts away from the public interest and meeting community needs to ensuring profit for the company's shareholders. Maybe the Conservatives should have consulted with the Federation of Municipalities who believe that this government should not be forcing a one size fits all policy down their throats.

Mandatory P3s are not the only privatization at play. People in Vancouver Island North, in my riding, are very concerned that this government is trying to privatize one of the largest common property resources in the country: our fishery. While it may not be part of the budget, the fact that the bill was introduced with no consultation with fishermen, lodge owners, recreational and sport fishermen, first nations or anyone else is a huge concern in my riding.

Then there is the issue of our forests. We in the NDP have spoken at length about the softwood lumber sellout and now we are seeing the result of that bad deal: raw logs exported at an ever-increasing rate and the government not willing to take a stand and implement a made in Canada policy to protect jobs in our communities.

Priority number three is that the Conservatives went out of their way to exclude first nations from the budget. This is one of the most outstanding and offensive omissions I have ever seen.

I have been meeting with many of the chiefs in Vancouver Island North over the past couple of weeks to talk about the budget. We have also spoken about many other issues of concern to their communities. The level of frustration and anger they are feeling because of what is lacking in the budget is very high.

The government announced $300 million for a housing initiative that allows them to buy their own homes, but it is a reannouncement of old money, nothing new. What the chiefs want to know is when they use the $300 million for housing and there is no new money, what programs they are going to lose to have to pay for it.

There was nothing in the budget for land claims and treaty settlements. First nations are ready to settle. They want to move forward for their communities, for their economic well-being, but they cannot because the government says it does not have a mandate to settle. The government underlined that in the budget by not putting any money in it for land claims.

Priority number four is that no matter how big the surplus, no matter how well our economy is running, the Conservatives invest nothing in social programs. This particular priority hurts every community and quite often the most vulnerable in our society.

A reintroduction of the same money the Conservatives introduced last year for child care, $250 million, will not help build a national child care program. That program would be helping ordinary working families and parents with escalating child care costs and a lack of spaces.

There is nothing in the budget for the arts. There is no mention of culture. It is not even on the government's agenda. There is nothing for art programs for kids and communities, nothing for artists and sadly, nothing for museums. There is nothing for pharmacare, home care or long term care for seniors. There may be some old money to address wait times, but the government said that last year and wait times actually went up. These programs are what made Canada a great country; at least my Canada includes them.

Priority number five is to pretend that a crisis does not exist in the forest industry. On the contrary, the current state of the lumber industry is a perfect example of how Canada is losing on trade with the U.S. The steady creep toward free trade and further harmonization at any cost is hurting this country.

Our timber mills are closing. Over 5,000 jobs have been lost since the softwood lumber agreement was signed. Ask the mill workers in my riding who have seen their jobs and their logs get trucked over the border on a daily basis. “Did this government stand up for Canada?” they are asking. I say no. Instead, in a rush to placate their Conservative counterparts in the south, the Conservatives ignored five international trade rulings in favour of Canada. They signed a bad lumber agreement and managed to give away $1 billion in the process.

This whole mess was done in the name of harmonizing inefficiencies. What is so efficient about losing jobs? The Conservatives may have made harmony with the U.S., but they sure left a heck of a mess behind in their wake. And to add insult to injury, the budget provided no funds to help struggling communities when our mills are closing.

The government cannot just ignore these problems and hope they go away. It has to take action to help these communities. The government has to stop exporting raw logs from federally regulated lands. Then it needs to clean up its act by providing aid and a comprehensive plan to help these communities and stop mill closures. But there is no plan. There is no stabilization funding. It cannot be found in the budget. The government needs to start making decisions that actually help hard-working Canadians.

As a former labour representative, I understand the intent of these policies. Their point is to undermine local democracy and allow private corporations to benefit from government contracts. That is it. The result is there is a steady race to the bottom in the quality of work being completed while municipalities struggle to accommodate more and more needless bureaucracy.

While the government beats its chest about standing up for Canada, ordinary Canadians are beginning to recognize that the truth speaks louder than words. The truth is the prosperity gap is growing. The truth is our communities, infrastructure and natural resources are being privatized. The truth is first nations are being ignored. The truth is investment in social programming is abysmal. The truth is the forest sector is in crisis.

Canada's corporate CEOs are getting richer and richer. Ordinary hard-working Canadians are being left in the dust. They deserve better. They deserve fairness, and the budget does not deliver it. For those reasons, I cannot support the budget.

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3:45 p.m.

Conservative

Mike Wallace Conservative Burlington, ON

Mr. Speaker, I appreciate the intervention by my colleague from the New Democratic Party, but I do not agree with her at all. She talked about truth. What is important for Canadians is there needs to be some truth in what is said in the House.

I have the budget in front of me. I went through it a couple of times as a member of the finance committee. For example, we have introduced the WITB, which is a program to help people get over the welfare wall, to give the working poor in this country an advantage. If someone leaves social services and starts a job at $8.25 an hour, our program in the end will improve that person's quality of life and his or her disposable income by 25%. That is an important piece that we are providing for working families.

The member said that we are not doing anything to address the gap between those who have and those who do not. We are doing what we can. We have outlined a program in the budget that directly affects people's ability to move ahead as a family economically in this country.

The member also stated that there was no mention of culture in the budget. That is absolutely not true. If she would turn to page 98 of the budget, it talks about a program of $30 million over two years for local arts and heritage festivals; summer museum internships to help small museums across the country get the quality people they need to provide the services and programs that communities are demanding; and a Canadian heritage sports program to help sports that are important to the history of this country.

My question--

Budget Implementation Act, 2007Government Orders

3:45 p.m.

NDP

The Deputy Speaker NDP Bill Blaikie

Order. The hon. member got two minutes out of the five and there are other people wanting to ask questions.

I will go to the member for Vancouver Island North.

Budget Implementation Act, 2007Government Orders

3:45 p.m.

NDP

Catherine Bell NDP Vancouver Island North, BC

Mr. Speaker, I would remind my hon. colleague of the many things in our communities that ordinary Canadians were calling for, such as money for housing. There is a huge crisis across this country when it comes to housing. Whether people have jobs or not, it does not matter; they are having a hard time finding places to live.

There are people in my community who are living in campers in the park waiting for rental houses to become available because the vacancy rate is so low. My community is a small one. In other communities in my riding there are people who are in the same sort of situation. I hear on a daily basis from my colleagues across the country about the housing issues in the inner cities and larger communities, cities and towns. There are people who cannot find places to live. That has so many other implications for families.

For the government to completely ignore housing in the budget is outrageous. It has been such a big issue. People are calling for a national housing strategy. That the government left it out of the budget is beyond words.

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3:50 p.m.

Bloc

Guy André Bloc Berthier—Maskinongé, QC

Mr. Speaker, I listened to my colleague and I agree with some of the points that she raised about this budget. She mentioned the absence of numerous social programs and policies. There is nothing for employment insurance. For many years now, we have been calling for improvements for people in need, and there is nothing about that. There is nothing either to help older workers, and nothing to support our industries. For example, Quebec has lost 100,000 manufacturing jobs since 2003. There is really nothing, no real measure to support that industry.

So there are shortcomings. We voted in favour of the budget because it marked a step forward in addressing the fiscal imbalance. I call it a step forward but the problem still has not been resolved.

In her remarks, my colleague barely mentioned the federal spending power. At present, large sums of money coming from the federal government are spent in areas that fall under provincial jurisdiction, such as health care or education. That leads to all kinds of duplication of services, infrastructure and bureaucracies. This waste of federal money directly prevents the public from receiving proper health care and education services.

I would like to hear my colleague's views on federal spending power and ways of limiting that power.

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3:50 p.m.

NDP

Catherine Bell NDP Vancouver Island North, BC

Mr. Speaker, I disagree with my Bloc colleague's comments about federal spending.

There are a lot of programs that the federal government should be delivering across the country, such as a national child care program. Quebec has a wonderful program. The rest of Canada would like to have that too. It would go a long way toward helping working families and single parents, moms and dads, to alleviate some of the costs that they face in bringing up their children when they have to go to work.

There are a whole lot of other things that I did not get to talk about with regard to spending that the government has failed on, such as foreign aid. We have actually seen the commitment to foreign aid drop. It is an embarrassment on the world stage for Canada when we said we would live up to a commitment of 0.7% of the GNP for foreign aid and we have actually decreased our foreign aid spending. It is a sad thing for Canada.

Budget Implementation Act, 2007Government Orders

3:50 p.m.

Liberal

John McCallum Liberal Markham—Unionville, ON

Mr. Speaker, I am very pleased to speak once more to the budget. I thought I would use my time to focus on two items in the budget, which have been the recent focus of attention, income trusts and the interest deductibility provisions. I also want to use part of my time to show the linkages between those two.

The first point to make, which has been made before but it is so fundamental that it cannot be said too often, is that the income trust tax was a massive broken promise. The Prime Minister said, in words that could not have been clearer, during the election that he would not tax income trusts. On the strength of that solemn declaration, hundreds of thousands of Canadians took the Prime Minister at his word, put their life savings into income trusts, knowing that there were market risks but confident that there were no political risks, because the Prime Minister of the land had committed himself in unequivocal fashion to not tax those income trusts.

On Halloween of last year, when he absolutely and totally broke that promise by imposing a draconian 31.5% tax, he cut all those people off at the knees, caused a $25 billion meltdown of the hard-earned savings of those Canadians, many of whom are seniors who depend on the proceeds of their savings to pay the bills. The error was not simply the broken promise, but it was the incompetence of the manner in which that promise was broken. This is the first parallel between the income trust decision and the deductibility decision.

The finance minister has a tendency to go nuclear. When he sees a problem that might be a little problem, his tendency is to drop a nuclear bomb on it. He does not consult, he just drops the bomb and then finds out afterward what happens. A far more sensible approach would be a surgical approach; look at the problem, isolate the problem, consult before acting and think before acting. He does not think it through, but drops a nuclear bomb, lets it explode and then deals with the consequences thereafter.

Just yesterday he said, on the subject of deductibility, that he would spend some time on it now, some weeks after the budget. Why did he not spend some time on it before he made that decision? Instead of destroying $25 billion of consumers wealth, why did he not spend some time on thinking it through before he took that ill-fated action last Halloween? It is a bit late to start to spend some time on it now.

My point about the surgical nature of the operation in the case of income trusts is that what he should have done, and he had the information at his disposal, was to follow the Liberal plan, which says not to impose a 31.5% tax. That is absolutely unnecessary, draconian and it causes a $25 billion meltdown in Canadian savings. What we would do, and what we will do if we come to power, is impose a 10% tax, not a 31.5% tax and our tax would be refundable to all Canadian residents except non-residents who would have to pay the tax to ensure that they would pay a reasonably full share of the tax burden.

There are three positive effects of this alternative Liberal policy. Some intelligent people in the finance department could have told the minister this. It is not rocket science. Had he done our much more moderate, surgical, non-nuclear approach first of all, some two-thirds of the $25 billion lost to ordinary hard-working Canadians would have been returned to them through the markets under this Liberal plan.

Second, seniors in particular, who have need of a high yield instrument in order to get a return from their savings to pay the bills, would not be deprived of this income trust instrument, which is what is in the process of happening under the government's budget.

Third, the energy trust sector, which was a vibrant sector contributing to the nation's productivity according to the governor of the central bank, would have been allowed to continue to thrive under the Liberal plan.

Before Halloween, the energy trust sector was repatriating foreign capital. It was a net acquirer of foreign assets. Right now, it is sitting on its back, at bargain basement prices, being gobbled up by U.S. companies that are still subject to the tax rules that our Canadian energy trust was subject to prior to Halloween.

This is hugely damaging to a vibrant, highly productive sector in Alberta and it is hugely counterproductive to thefinance minister's stated goal. The finance minister's stated goal was tax fairness, that ordinary Canadians should not pay more than their share of taxes.

Let us think through, logically, the consequences of his actions. It was imminently predictable at the time of his decision that these energy trusts in Alberta, and other income trusts, would be for sale at bargain basement prices and that foreign entities, notably private equity companies, would come in and buy them up.

What does that do to the necessity for ordinary Canadians to pay taxes? Logically, it means that ordinary Canadians will have to pay more tax, not less tax. Why? Because under the previous structure, income trust holders were paying a lot of personal tax. Now what has happened is these private equity foreign companies come in, buy the assets and structure those purchases in such a way that they pay no tax. How does that save tax money? It does not; it does the opposite. It is not rocket science.

Previously, income trust unit holders were paying a lot of tax. Now the foreign entities come in, buy out those income trust holders and pay no tax. The net effect is the income trust sector is paying way less tax, and in many cases no taxes, than they were before. The public at large is going to end up footing a larger tax bill, not a smaller tax bill. Therefore, the fundamental objective of the policy, as stated by the finance minister, the opposite is in fact what is going on today.

There is a second way in which this is not fair.

First, the ordinary Canadians pay more tax because of the policy. Second, in the good old days, the pre-Halloween days, ordinary Canadians had access to this relatively high flow of income arising from the energy trust sector. Now the government says, no, that ordinary Canadians can no longer go there, ordinary Canadians can no longer participate in this revenue stream that is so important for seniors. However, the people with deep pockets can. If we had enough money to buy an oil field, we could still get those same benefits. Large pension funds can acquire those assets. Large private equity enterprises from the United States can achieve those same income streams, without paying any tax at all. That is unfair.

It was a revenue stream that was available to all Canadians, some with modest incomes, some with less modest incomes, in a democratic way. Ordinary Canadians cannot go there any more. Only the entities with the deep pockets and the big wallets are allowed to go there.

I will now come to the important point about interest deductibility.

This is a very important parallel between these two policies. What the government is doing with the interest deductibility prohibition is it is tilting the playing field in favour of foreign companies and against Canadian companies. Whether we look at Europe, the United States or Japan, all those jurisdictions have equivalent policies. Their companies, when they go abroad, can deduct the interest on debt. Canada's companies can no longer do that. Our companies are weakened relative to companies from the U.S., Europe and Japan.

Why would the Minister of Finance and Prime Minister wish to tilt the playing field in favour of the foreign companies and against the Canadian companies? It is a totally erroneous policy. It is anti-competitive. It is exactly the same as what the government has done with the energy trusts. The U.S. equivalent of energy trusts have the same favourable tax treatment.

The government has tilted the playing field in favour of the U.S. companies both for energy trusts and in general. It has moved against Canadian companies. Canadian companies for competitiveness, for jobs, for prosperity need to expand abroad and the government has attacked that ability to the gain of foreign companies.

I do not have to remind the House of that great Progressive Conservative Peter Lougheed. He has spoken out against the dangers of the hollowing out of Canadian companies, a message that the government has totally ignored.

Budget Implementation Act, 2007Government Orders

4 p.m.

Conservative

Mike Wallace Conservative Burlington, ON

Mr. Speaker, I am happy to rise and debate this with my colleague from the other side.

The Liberals voted against the ways and means motion. They are probably going to vote against the budget as it goes. I want to point out that the Liberals are voting against the new working income tax benefit the working poor, the new $2,000 child tax credit, the $16 billion in new infrastructure funding, the $1.5 billion for the provinces and the territories to help develop environmental measures, $600 million to reduce patient wait times, $300 million to combat cervical cancer, $1 billion in tax cuts for seniors, a 40% increase in post-secondary education transfers to the provinces and $20 million in establishment. There are a few more things I could go through.

He spent all that time on income trusts, but the member across was quoted as saying on Question Period on CTV, November 5, 2006, the following:

It was absolutely the right thing, and we had started on this track to protect the tax base, to ensure tax fairness and to work for the productivity of the nation.

Did he or did he not say that on national television on a Sunday morning on November 6?

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4:05 p.m.

Liberal

John McCallum Liberal Markham—Unionville, ON

Mr. Speaker, the Conservatives love that quote, but they always leave out the following six or seven words that I said, and that was they were wrong because they used a nuclear approach when the surgical was required. This is what I continue to say to this day. If they would look at the full transcript, they would see that.

Let me speak to one of the measures referred to by the member, the working income tax benefit. That is a really meanspirited working income tax benefit. It is very miserly. It has half the value only of the previous Liberal version.

My contention is the government really only wishes to appear to care about low income working Canadians. The measure that it has adopted is so miserly and ungenerous. It will only help a person get a few feet up the welfare wall. It will do nothing to help them get over it. This is what the Conservatives bring out at every opportunity to pretend they care about poor people, but they do not care about poor people at all because those are not the Conservative constituency.

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4:05 p.m.

Conservative

Michael Chong Conservative Wellington—Halton Hills, ON

Mr. Speaker, I listened to the member for Markham—Unionville. I think some of what he has said is quite interesting with respect to the hollowing out of corporate Canada.

The new position of the Liberal Party to oppose foreign direct investment into Canada is very interesting to me. The way the member was talking in the debate, it sounded as though he actually opposed the idea of foreign direct investment of foreign capital coming into Canada, making investments into Canadian businesses and enterprises. This is something this government supports. Our government believes this has contributed greatly to our prosperity and productivity.

Is this a new position of the Liberal Party, that it will now oppose foreign direct investment into Canada? The Conservative Party believes this is very good for the Canadian economy.

Budget Implementation Act, 2007Government Orders

4:05 p.m.

Liberal

John McCallum Liberal Markham—Unionville, ON

Mr. Speaker, the hon. member question is a far more sensible question than that of his predecessor. It is a good question, but it is not right.

The Liberal Party is not opposed to foreign direct investment. I agree with the hon. member that foreign direct investment brings many benefits. We are in favour of foreign direct investment by foreigners into Canada and by Canadians to other countries. That is a part of the world in which we live.

What we oppose is when government policy tilts the playing field to favour the foreigners at the expense of Canadians. This is what the interest deductibility thing does. We want Canadians to be able to compete with foreigners on an equal footing, on a level playing field. The minister's policy, by removing that privilege from Canadian companies, while companies of other countries retain it, has favoured those other countries at the expense of our companies.

He is creating not a Canadian advantage, about which he likes to talk. He is creating a Canadian disadvantage in favour of foreigners. That is our problem. Our problem is not foreign investment per se. Our problem is creating a playing field where the government, whether by error or by whatever reason, not thinking it through, has worked in favour of foreign companies and against Canadian companies.