Mr. Speaker, it is with pleasure that I rise today to speak on this motion at a critically important time for Canada in the global economy.
We live in a time of unprecedented rapidity of change, a hyper-competitive global economy where a country or a company is either moving forward or is falling behind. We cannot sit still.
The week before last, I was at the world economic forum in Davos, Switzerland, surrounded by political and business leaders from around the world, people who represented some of the fastest growing economies and companies in the world. The focus at Davos was on issues like science, research and development, the importance of science to competitiveness, and the issue of climate change and the greening of the global economy.
In fact, European Business magazine's issue that particular week was “Profit from a changing climate”, which said that greening one's economy can in fact create jobs, opportunity and prosperity, and that we are heading toward a global carbon-constrained economy. In that kind of environment, as a price is put on carbon by multilateral government organizations and individual governments, we will see that environmental laggers will become economic laggers.
The focus was on competitiveness in a cleaner, greener environment. Here in Canada we have a government that has not focused on competitiveness, has not focused on environmental stewardship, and in fact has focused only on short term politics as opposed to building competitiveness. Its tax measures have been more focused on buying votes than on building a richer, fairer or greener Canada.
It was also announced at the world economic forum, in its most recent study, that Canada has slipped in terms of our global competitiveness this year to number 13 in the world.
This is a time when countries like Ireland, the Netherlands, Sweden, Finland, Australia and New Zealand have reformed their tax systems to be more competitive, to attract capital, to grow their economies, and to build higher wage jobs and greater prosperity for their citizens.
In Canada, we have not had significant tax reform in fact since 1971 with the Carter commission under the Chrétien government and the government of the member for LaSalle—Émard. We saw the biggest personal tax cut in Canadian history, but we really need overall tax competitiveness.
Instead, this government has chosen to cut consumption taxes with the GST. It was repeated by economists around the world that in fact it makes more sense, instead of cutting the GST and that $14 billion per year that it takes out of revenue, to cut personal income taxes, for instance, focusing on low and middle income Canadians.
With $14 billion a year, we could raise the basic personal exemption, the threshold at which Canadians start to pay taxes, to about $20,000. That would take millions of low income Canadians off the tax rolls altogether. It would be fairer. It would also provide tax relief to all Canadians at every income level, particularly favouring low and middle income Canadians. It would build a more competitive tax system because economists are united around the world that if we are going to cut taxes for competitiveness, to create jobs and prosperity and for better fairness and equity, it is better to cut income taxes than consumption taxes.
The government has taken a different approach. It is the government and has the right to do that. I just believe that there are fairer and more competitive approaches to tax reform.
Furthermore, beyond that, there has been some discussion this morning on competitiveness and manufacturing. I serve on the industry committee and the recommendations presented by the industry committee a year ago could make a huge difference. As my colleague from Markham has said, the government has chosen to only respect and follow one-half of one recommendation.
Today in The Globe and Mail, there is an article entitled “Business pushes for new tax relief, Finance Minister under pressure to offer new subsidies but slowing economy eroding federal coffers”.
Why is the government seeing the federal coffers decline? It is not only the slowing of the economy. It is the fact that we have the biggest spending government in Canadian history. It is a government that has not only chosen to increase spending like a drunken sailor. At the same time it is cutting a consumption tax instead of focusing on business taxes, personal income taxes and competitiveness.
Furthermore, the article says that companies pitch Ottawa on scientific innovation. Our leader has presented making the SR and ED program refundable, such that all companies can benefit, through the tax system, from sound investments in research, development and commercialization, because science matters.
When we speak of science, it is important that at the very top decision making levels of government, governments in today's economy understand the importance of science. I was particularly dismayed when the Prime Minister not only fired the national science adviser to the Prime Minister, but completely eliminated the position. There is only one other jurisdiction in the world this year that has demoted and reduced the role of the national science adviser, and that is the Bush administration.
The national science adviser provided to the Prime Minister the kind of sound advice, whether it was on climate change, or stem cell research, or reproductive technology, or the green economy or on innovative new areas such as cleantech. I believe cleantech will be the fastest growing area of the global economy. We are seeing venture capital firms, such as Kleiner Perkins and others, which were behind the Internet revolution, now investing massively in this area. This is an area where Canada could excel.
David Rubenstein from the Carlyle Group, speaking at a venture capital conference in Quebec City a few months ago, and who was also at the Davos conference two weeks ago, said to me personally, “Canada has the potential to be a global leader in clean energy and cleantech”.
To that end and further, in today's Report on Business is an article “Energy players in carbon capture drive”. Currently a group of energy leaders and businesses in Alberta is focused and prepared to make massive investments in a CO2 sequestration project. It says that the federal and provincial government plans to back its development are still at a preliminary stage.
Business is ready to act. Business is looking for sound signals and strong investment alongside of business to leverage on government and business investment to make the kinds of investments that can not only reduce Canada's carbon footprint, but can also make Canada a leader in clean energy. This is another area on which the government has not focused. We know its interest in climate change is perfunctory at best. We also understand the government has no real interest in long term competitiveness. It is more focused on short term, vote buying schemes.
It is critically important for Canadians, whether they are in the manufacturing sector, the forestry sector or agriculture, to see a government with a plan. Our Liberal leader recently spoke in Hamilton to launch a Liberal industrial strategy around manufacturing, including the $1 billion advanced manufacturing prosperity fund, the AMP program. Our leader spoke of partnering and leveraging with private sector capital to create the kinds of high wage jobs that could make Canada more competitive, to stand shoulder to shoulder with Canada's manufacturing sector, not to abandon them with the laissez-faire “I don't care approach” of the Conservative government, but to stand with them and to help their businesses become more competitive. We need to reform our SR and ED program to ensure Canadian businesses have the capacity and the incentive to investment in cutting edge research and development that can create the kinds of discoveries which lead to greater competitiveness.
Furthermore, the previous Liberal government made a significant investment in the forestry sector, a $1.5 billion focused forestry fund that the Conservative government eliminated in one of its first acts as a government. The $1.5 billion, which was introduced two years ago by a Liberal government, focused on helping forestry communities diversify and succeed. The government replaced it with a less generous $1 billion program, less focused. The Conservative program was focused on all industries, not only the forestry industry.
The government is offering too little, too late, without vision, without focus and without an absolute plan to help bring Canada forward.
The Liberal Party and the Liberal leader are offering Canadians a plan to build a richer, fairer, greener Canada to be more competitive to create the kind of sustainable wealth that Canadians deserve and also to ensure that Canada plays its role as a responsible environmental citizen of the world. This is the kind of plan Canadians deserve and this is the kind of responsibility parliamentarians have to present those kinds of plans, to debate them and to earn their support among Canadians.