Mr. Speaker, I am pleased to speak today to Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007.
As vice-chairman of the Standing Committee on Finance, the committee and I had the opportunity to study the bill in detail and we heard from numerous witnesses on some of the bill's more contentious issues.
For the past 16 months, one of my major grievances with the government has been its lack of vision. Since my time on Parliament Hill, I have never seen a government anger and disappoint all sides of the political spectrum the way this Conservative government has. It has not only managed to alienate its former supporters but it has also failed to endear itself to its adversaries.
At several points during its mandate, the Conservative government enacted piecemeal legislation that had not been well researched, developed or consulted upon. It has botched several files, most recently the Canada summer jobs program where hundreds of community organizations were left without funding. Even worse was the fact that these groups had no contacts and could not receive straight answers from the ministry because of government mismanagement.
First the Conservatives cut the program and then they reintroduced it but with less money. They received thousands of complaints and put more money into the program. At this point we still do not know which group is getting funding and how much. This is just another example of how far removed Conservative values are from the values of most Canadians. It took intense pressure from this side of the House, as well as protests from groups across the country, to get the government to backtrack on its ill-conceived plan and to reinstate funding to non-profit community groups across Canada.
I have spoken to the budget on several occasions and have highlighted all my preoccupations with the Conservatives, mainly that they lack any vision whatsoever and look only to immediate, political gain instead of long term goals for Canada. A perfect example of this are the green levy and the auto eco-rebate. Those are the only green initiatives contained in the budget and they were developed without any consultation with the automotive industry.
Encouraging Canadians to purchase fuel efficient vehicles is a step in the right direction, but an additional tax on certain vehicles is not the answer. In fact, it is a simplistic solution to a complex situation that instead requires a multi-pronged and careful approach.
According to testimony the committee heard from both industry and environmental groups, the proposed green levy and auto eco-rebate will fail to produce any meaningful change in reducing carbon emissions. These programs damage domestic automakers by placing $67 million worth of levies on domestic vehicles, which is about 80% of all the levies that will be collected. The transfer of $47 million in benefits to one company, which is 75%, for one vehicle that is produced offshore.
We should remember that when Canada imports foreign cars, greenhouse gases are produced by ships that cross the ocean to get them here. The more cars Canada imports, the more emissions the ships produce. Therefore, when the government offers a feebate benefit to only one foreign produced car, not only is it discouraging people from buying cars made in Canada, it is also encouraging increased emissions from a greater volume of imports which essentially cancels out the emissions difference the rebated cars produce.
Only three of the twenty-one eligible cars under the feebate program are made in Canada. While I do not want to give cars that are not fuel efficient an easy pass, I do think the government should not be punishing Canadian automakers at a time when our industry has suffered so many job losses in the last decade.
2006 marked the first time in 18 years that Canada had an automotive trade deficit. This was down from a $15 billion trade surplus only seven years earlier. In those seven years, Canada has gone from being ranked number four in auto assembly worldwide to being ranked number nine in 2006.
Companies such as Ford, Chrysler and GM account for eight out of every ten auto workers in Canada. However, with these measures in the budget, Canadian workers are being punished. These measures also damage the Canadian economy segment in vehicles. The $1,000 rebate for one vehicle, which makes up half of all rebates, undermines the ability of other dealers and manufacturers to sell equally beneficial subcompacts competitively on the same basis. Perhaps the biggest failure of these measures is that they fail to help get older cars off the road.
The majority of greenhouse gas emissions produced by Canada's on road fleet of cars are produced by older vehicles. There are significant differences between the amounts of emissions a 1990 model creates as compared to its 2007 counterpart. The Conservatives were better off putting more money and more energy into getting older cars off the road than they were by punishing new cars.
Recently, the finance minister has been quoted on committing another flip-flop by announcing that he would reconsider the way that the green levy and the auto ecorebate would function. This is a good sign, but it is too vague to have much meaning.
During the clause by clause of this bill in committee I put forward a motion to remove the clause dealing with these measures in order that the government would be able to rethink its policy on this issue, but without success. I only hope that the minister will stay true to his word and look at alternative measures to deal with the auto industry. These measures should not punish Canadian automakers which is currently the case, and should emphasize getting older cars off the road.
As I mentioned earlier, these vehicle feebates were some of the only green initiatives contained in the budget. The Conservative government is failing to protect the environment and Canadians are getting fed up.
The environment minister has attempted to douse the fires by putting together more piecemeal legislation but, guess what? That has also failed. By not consulting environmental groups the government demonstrated its arrogance and its ignorance on the issues of climate change and the environment.
One specific example that was raised during the finance committee study of this bill was in the crucial area of ocean conservation. The government has reduced the budget of the Department of Fisheries and Oceans by $105 million and has only allocated $18 million over two years to the conservation of oceans in our economic zones.
It is a sad statement when experts agree that it will take over $100 million per year to get Canada on track to meeting its international commitments in ocean conservation.
In 2005 the Liberal government announced the Canada's oceans action plan and had begun allocating money when a premature election was called. Since coming into power the Conservatives have mismanaged all environmental files, but perhaps they have done the most horrendous job of protecting Canada's oceans.
Canada has only protected less than 1% of our economic zone and with the Conservatives in power that figure will surely not improve. I cannot understand how the Conservatives can spend millions of dollars buying military equipment to protect Canada's Arctic region, but allocate practically nothing to protect the Arctic Ocean.
They can spend millions on patrol boats, but refuse to allocate money into protecting our oceans, which directly employ approximately 98,000 Canadians. Seafood exports account for about $5.5 billion of our economy, yet the government does not deem the oceans important enough to properly fund their conservation.
These measures contained in the budget have not endeared the government to environmentalists and we can forgive climate change experts for doubting the Prime Minister's new found devotion to the environment. We can also forgive these same experts for going one step further and calling the government's environmental plan a fraud and sellout.
As I was saying, the Conservatives have not only raised the ire of the left, but they have turned their backs on their allies on the right. I am talking of course about the energy sector in Alberta and its dissatisfaction with the government's decision to tax income trusts. I suppose that when he came into power in 2006, the Prime Minister never imagined that the Liberal Party would come to the defence of so many energy corporations in Alberta and the way in which they want to structure themselves.
The Prime Minister and the Minister of Finance delivered a low blow to investors and corporations when they blindsided them on Hallowe'en with a 31.5% tax rate on income trusts.
Several months ago, the Standing Committee on Finance tried to understand how the government calculated the so-called tax leakage in the income trust sector. After the committee was repeatedly denied access to these documents, it came to the conclusion that the government's decision to tax income trusts was based on imprecise data and was another case of mismanagement. Unfortunately, the Conservatives' mismanagement of the income trust matter cost Canadian workers $25 billion. These working people had found a high performance investment mechanism for their retirement. From one day to the next, the Minister of Finance destroyed years of savings. And the government has the audacity to claim that this measure is part of its tax fairness plan. I do not see what is so fair about liquidating Canadians' savings or the consequences of this decision to the energy sector in Alberta.
Small oil companies are having trouble because of reduced access to capital. These companies are using all of their resources just to stay afloat. That means that they have less to invest in reducing greenhouse gas emissions and making their production systems more environmentally friendly. Moreover, the income trust decision is threatening our energy corporations. They are at risk of being taken over by foreign interests. Recently, we have seen a number of takeovers and takeover attempts by foreign companies, which will weaken the Canadian economy and reduce the government's tax revenues. Rather than help Canadian companies, the government has hurt our industry and has made an unprecedented number of foreign takeovers possible.
The Liberal Party proposed a fair solution to income trust taxation. It was a solution that experts, businesses and investors agreed on. Unfortunately, the government ignored our proposal, which was rejected by the Standing Committee on Finance. Then the Liberal members proposed adopting the Bloc Québécois' income trust amendment. The amendment would have extended the grace period from four years to 10. Thanks to Liberal support, that amendment would have been passed had the Bloc members not changed their minds and voted against their own proposal. This proves that the Bloc Québécois has no useful solutions to offer to Quebeckers and that it is not protecting Quebec's interests.
During a meeting of the Standing Committee on Finance, a Bloc member said:
Let's not forget that when we examined the report, the bill had not been submitted to us. We wanted to find the best possible solution. However, in the present context, what we really hope for is speedy passage of the bill so that the budget can be implemented as soon as possible.
In other words, the Bloc members are here for the sole purpose of protecting their own interests. An amendment could easily have been adopted to allow Quebeckers and all Canadians to benefit from a four- to 10-year grace period. After speaking out so vigorously against taxing income trusts, the Bloc members changed their minds. Moreover, they lack courage when real changes have to be made.
I doubt that the many people who have invested in income trusts in Quebec and Canada are pleased with the Bloc's about-face.
Another area where Canadians will be feeling the crunch from Conservative mismanagement is set to begin as the summer gets underway. With Canada's tourist season in full swing, a thriving section of our economy must deal with the elimination of one of its greatest selling tools, the visitor rebate program.
The program gave Canada's tourism industry a valuable tool to help it compete for global tourists. Once again, without any consultation with the tourism industry, the government eliminated the program. Only a small handful of developed nations do not have a federal sales tax rebate program for tourists. Thanks to the Conservatives Canada can count itself among these few. It is difficult to understand why the government wants to weaken Canada's tourism industry since so many Canadians are dependent on this industry.
After the special finance committee's hearing requested by Liberal MPs to study the visitors rebate program, and along with the help of industry stakeholders, the continued pounding of the government on its ill-developed decision finally convinced the finance minister to announce a federal foreign convention and tourist incentive program in Bill C-52. That measure in the budget partially corrects the mistake made by the government when it first eliminated the GST rebate program, but it does not go far enough.
Why was the government determined to destroy a program that worked as it did with the Canada summers job program? The argument surrounding the GST rebate could not be timelier as summer is now upon us. I am glad to see some reversal by the government on this matter, but there is another set of seasonal problems for which the government must account.
As we know, summertime is also a season of festivals in Canada. My hometown of Montreal is host to an endless number of world renowned festivals which draw millions of visitors each year. Anyone who has seen the international jazz festival and the just for laughs festival understands how important festivals are to Montreal's economy. I wonder if the current Minister of Canadian Heritage and Status of Women has been to Montreal during festival season because her actions have led us to believe otherwise.
Just a few weeks ago, the presidents of Montreal's two largest festivals spoke out against the minister's lack of action to secure funding in time for the summer. Festivals are a huge economic boost to local economies across the country and the minister's inability to assure funding for these festivals is a complete failure on her part and on the part of the government. I cannot understand how the Conservatives can mismanage such an obvious and crucial file such as this one.
Art groups across the country have been criticizing the government for months about the disastrous underfunding of the arts. Cultural groups in the country have felt insulted and ignored by the government and it has caused well-known authors and artists to speak out. We cannot allow Canada's vibrant arts community to suffer under the Conservatives' ideological program cuts and mismanagement.
We have already seen them mismanage countless files by closing Liberal programs and then reopening them only a few months later under a new or different name, whether they wanted to take credit for these supposedly new programs or whether they just thought that no one would notice that they were gone remains unclear.
This began in September 2006 when the Conservatives cut a number of effective Liberal programs. The Liberal Party protested these ideological cuts, as did the public. Since then we have seen the government re-announce these programs under new names and pretend as if the Liberal initiated programs never existed.
Canadians deserve better than what the government has given them, ill-conceived, piecemeal programs that will not help Canada advance into the 21st century. The government is much better at photo ops and slander than it is at governing and our country is not any better for it.