Debates of Feb. 9th, 2009

Budget Implementation Act, 2009

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

moved that Bill C-10, An Act to implement certain provisions of the budget tabled in Parliament on January 27, 2009 and related fiscal measures, be read the second time and referred to a committee.

Mr. Speaker, this is a very important bill in this Parliament. It contains many measures. It contains measures related to infrastructure, tax changes, training, and all sorts of things that will help stimulate the economy.

With regard to infrastructure, many of the experts the finance minister consulted believe that the best way to help stimulate employment is through infrastructure. That is why we made arrangements with all the provinces to work with them to build the basic infrastructure of this country: roads, sewers, water plants and even a RInC program. We will provide $500 million in the budget to help restore the quality of the various RInCs around the country, most of which were established in 1967.

Beyond that, we are now working with the provinces to ensure there is sufficient training for our citizens because unemployment is starting to rise. Recently, it was 6.2% and it has now moved into the 7% category.

Mr. Speaker, I will be splitting my time with the Parliamentary Secretary to the Minister of Finance.

Training is required because unemployment is starting to rise. This rise in unemployment was basically caused by the worldwide recession. As we know, the worldwide recession began in the United States where there was a very weak housing situation. Millions of houses had been sold to people who could not pay their mortgages. They defaulted on their mortgages, causing many banks and trust companies to default. The banks which defaulted caused a ripple effect through the rest of the economy and banks around the world began to default. This has forced many nations to inject large amounts of capital into their systems to try to restore order within the banks.

The ripple effect began to affect companies, which in turn began to lay off people. This has affected Canada because Canada--

[The Speaker, Liberal, Peter Milliken]

Order. I hesitate to interrupt the hon. chief government whip, but I forgot something when he suggested he would be splitting his time. First speeches in debates on bills cannot be split. I am afraid that while he indicated he would like to do that, it would require consent. I am wondering, to help him out, whether there might be consent to treat him as not having spoken and call on the Parliamentary Secretary to the Minister of Finance to start his speech. Is there consent?

[Some hon. members]

Agreed.

No.

[The Speaker, Liberal, Peter Milliken]

There is no consent. There is a general cry then to hear the chief government whip. He will have his full time allotted, but I am afraid I cannot split his time unless there is unanimous consent. I see the chief government whip is ready to continue his speech.

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

Mr. Speaker, to carry on this illuminating speech, today we begin the legislative process for the first budget 2009 implementation bill, Bill C-10, a crucial piece of legislation in a period of unprecedented economic upheaval.

This process in itself might understandably confuse those Canadians not terribly familiar with the complexities of the budgetary process. Last week, they read newspaper headlines that blared, “Federal budget passes in House of Commons” and “MPs approve federal budget”. Naturally, they would believe that because the budget had passed or been approved that all measures in the budget could move forward. However, that is not the case. What the House passed was merely a general motion that approved the government's budgetary policy, not the legislation needed to actually implement its provisions.

This is a standard procedure. A budget motion passes and is followed in short order by the introduction of a budget implementation bill. That bill and the measures included therein cannot move forward until they go through the long process of approval through the House of Commons: second reading, referral to the finance committee, report stage and third reading, and then to the Senate. Again, after second reading, referral to the Senate national finance committee, and then to report stage and third reading. Once all this has successfully been completed, then royal assent is given. Again, this is a standard procedure, but it is also a lengthy and timely procedure.

Last year, the 2008 budget implementation bill was introduced on March 14, 2008. Only three months or nearly 100 days later, on June 18, 2008, was it passed by Parliament and given royal assent. I am not criticizing that process. I am a believer, as we all are, in the role of proper Parliamentary oversight. However, I am suggesting, in the midst of a global economic recession, and after witnessing the worst monthly job losses in Canadian history and the pressing need for economic stimulus, that we work together as parliamentarians to expedite the consideration of this bill.

We can move forward on measures in Canada's economic action plan dependent on this passage, measures that would help stimulate economic growth, work toward restoring confidence and, most importantly, support Canadians and their families through the current economic upheaval. Over 120,000 Canadians lost their jobs last month. Next month will not likely be better. We have been saying for some time that this will be a difficult year. We know that there will be significant and sustained job losses.

Our concern as parliamentarians should be in what lies behind those figures. There are families sitting at kitchen tables somewhere in Canada forced to have a discussion they would rather not have, asking difficult questions that have no easy answers, wondering where a new job will come from, where the money for the next mortgage or rent payment will come from, or even food on the kitchen table. We have a moral obligation to these families to not engage in frivolous, abstract and partisan debates that would only serve to delay the passage of this bill. The assistance it would provide them is far too important. We cannot wait three months. We cannot wait 100 days. This bill is too important. The consequences would be too severe.

I am heartened to see that the official opposition has understood the gravity of the situation and has supported the budget. I ask the Bloc and NDP to follow this example. I ask them to work co-operatively on expediting passage of this bill within the next short few weeks or even much sooner. We must a;; recognize that the time to act is now, not three months from now. To do otherwise would be tantamount to inviting economic catastrophe while also betraying our international commitment to contribute to current international efforts to provide urgent economic stimulus that will help to stabilize the global economy.

Looking at this situation, it is instructive to pay attention to what is occurring in the United States, the epicentre and genesis of the current economic downturn and President Obama's attempts to ensure timely passage of his stimulus legislation. Job numbers were also released in the United States a few days ago, showing nearly 600,000 jobs lost in January, continuing a string of 13 straight months of job losses that has seen nearly 3 million jobs vanish in that year alone.

The release of those sobering January U.S. job numbers prompted President Obama to make a plea to American legislatures on Friday:

The situation could not be more serious. These numbers demand action. It is inexcusable and irresponsible for any of us to get bogged down in distraction, delay, or politics as usual...Now is the time for Congress to act...This is not some abstract debate.

It is an urgent and growing crisis that can only be fully understood through the unseen stories that lie underneath each and every one of those 600,000 jobs that were lost this month...These Americans are counting on us...We have to remember that we're here to work for them. And if we drag our feet and fail to act, this crisis could turn into a catastrophe. We'll continue to get devastating job reports like today's -- month after month, year after year.

To this point we are fortunate enough to not have experienced the degree of economic chaos faced by our American neighbours. We are in a relatively much stronger position compared to them. Indeed, as BMO Nesbitt Burns chief economist Sherry Cooper recently declared, “Canada is in better economic shape to handle the global recession than most other countries--”.

As I said before, now is not the time to rest on our laurels and hope we will remain in a stronger position, especially in light of the severity of the present situation. We must avoid the temptation to engage in abstract and academic debates, avoid partisanship, and avoid inexcusable and irresponsible delay.

Now is the time for Parliament to act. We have an economic action plan in place. We need Parliament to help enact that plan by passing this legislation as soon as possible and without delay. That is what we can do right now.

While our plan is not going to save every single job, no plan could. We are doing everything we can to protect those hit hardest by the global recession with a plan to stimulate the economy and to help create and maintain jobs.

In the remainder of my time today I will systematically outline the few select measures from Canada's economic action plan included in this legislation. They are measures vital to stimulating Canada's economy, to help maintain and create jobs, to spur private sector growth and investment, and to help families most in need. They are measures that merit expedited passage.

This legislation would implement the tax measures proposed in our economic action plan, measures that would remove 265,000 low income Canadians from the tax rolls in 2009.

It would increase the basic personal exemption that all Canadians can earn before paying federal personal income tax.

It would increase the top of the two lowest personal income tax brackets, so Canadians can earn more income before being subject to higher tax rates.

The legislation would also provide an additional $150 of annual tax savings for low and middle income seniors through a $1,000 increase to the age credit amount.

We are increasing the amount that can be withdrawn from an RRSP under the homebuyers plan to $25,000. The Canadian Real Estate Association has applauded this announcement for both stimulating the housing market and “--[helping] Canadians who want to own their own home, and do it in a responsible way--”.

The bill would extend the temporary mineral exploration tax credit to help companies undertake exploration and adjust to new commodity prices.

It would increase the amount of small business income eligible for the reduced federal tax rate of 11% to $500,000 from $400,000. The Canadian Federation of Independent Business praised this measure as one of “importance of helping small and medium sized businesses to grow”.

The bill would also help Canadian families who will face job losses. For two years, all regular EI benefit entitlements would be extended by five extra weeks, increasing the maximum benefit duration from 45 weeks to 50 weeks. Food Banks Canada, the national charitable organization representing the food banks across Canada, has recognized the critical importance of enacting this measure. In its words, the five week extension may help to keep many Canadians out of the food bank lines. One-fifth of those it helps are not working or on EI and those households are facing a very precarious year. Food Banks Canada said it was glad to see the five week extension of EI benefits.

The bill would also improve access to financing and it would strengthen our financial system. We all recognize the impact the global recession is having on Canadian businesses, especially access to credit. We have heard loud and clear in the past months that Canadian financial institutions have been less willing to lend credit to worthy Canadian families and businesses. This has made an already difficult economic situation much worse.

To combat that, Canada's economic action plan announced measures to support the extension of financing to Canadians and Canadian businesses, and this bill helps implement that. With access to financing, Canadian families can continue to make the purchases that keep the economy moving ahead. Businesses will be able to purchase new equipment, invest in their operations and grow for the future.

This bill allows Export Development Canada and the Business Development Bank of Canada to extend additional financing to Canadian businesses, as well as increases the maximum eligible loan amount under the Canada small business financing program to $300 million per year.

Organizations such as the Canadian Manufacturers and Exporters heaped high praise on the economic action plan:

The government took critical steps in the budget to stimulate liquidity, provide incentives that will encourage manufacturers to invest in machinery and equipment, as well as a much-needed investment in strategic infrastructure.

This bill also authorizes key spending, as outlined in part 6, on infrastructure, community adjustment, housing and health care. This includes nearly $4 billion in investments for urgent infrastructure needs, spending to pave roads, improve our universities and colleges, fix sewers and repair bridges. These are investments that will not only modernize our infrastructure but will also, as the Canadian Construction Association has noted, “create jobs, stimulate economic recovery, and better our communities while providing Canadian taxpayers with the best bang for their stimulus buck...ensuring that Canadian communities, businesses and our workforce are well equipped and prepared to respond to the new opportunities that will present themselves as the economy recovers”.

It also includes over $1 billion in investments for social housing, and houses for low-income seniors and persons with disabilities, as well as first nations housing, investments praised by the Federation of Canadian Municipalities as they “put Canadian labour and building materials to work providing adequate housing for low-income families”.

It provides over $500 million to help foster economic development, science and technology initiatives, and other measures to promote economic diversification in struggling communities across Canada. It also authorizes $500 million for the development of electronic health records. The Canadian Medical Association commended this investment as “rightly aimed at supporting the front lines of health care,” and that it “will lead to better, more efficient care”.

These are but a few select measures in this bill that are vital for the implementation of Canada's economic action plan. Also included in the bill are measures that will help assist in the transition toward a Canadian securities regulator with willing provinces and territories. It will modernize the Investment Canada Act to encourage foreign investment and to make sure that new investments do not jeopardize Canada's national security. There are new provisions to the Competition Act to protect consumers from anti-competitive behaviour as well as unscrupulous business practices, and much more.

This is a comprehensive, detailed 524 page document, a lengthy piece of legislation. Indeed, I have only provided the highlights in my time today. We could literally spend hours, or months, engaged in abstract academic discussions about this bill, but we do not have the luxury of time, nor do the Canadians who have lost their jobs. With all due respect to those here who wish to engage in lengthy debates, I would ask them to remember that we conducted the most comprehensive prebudget consultation in history, open to all Canadians, this past December and January. We asked them for their input then; that time has passed.

As the Canadian Chamber of Commerce noted, “The government has consulted extensively.... In the interests of all Canadians, the plan should be given a chance to work.... We believe it is an important step forward”.

Let us work together and move forward with the vital measures in Canada's economic action plan as quickly as possible. We on the government side will do whatever we can to expedite this bill. We will put no further speakers up at second reading. Conservatives have offered to sit extended hours, night and day, at committee. I call upon all parliamentarians to act responsibly and follow that example. We must ensure that this bill passes as quickly as possible without the delay of months. Now is the time for Parliament to act.

[John Cannis, Liberal, Scarborough Centre, ON]

Mr. Speaker, I listened very carefully to the chief government whip. He told us about what is in this budget. He talked about the need for co-operation. He knows very well that the Liberal team is putting people and country first, but with caveats, and that is what I would like to ask him about. He told us what is in this budget. Could he tell us about a timeframe?

I ask the question because in the building Canada fund some years ago, the Conservatives put in $33 billion, of which not even 10% has been delivered. What good is it if all these programs are put forward? We are co-operating on this side to make sure that the bill is passed. What are the Conservatives going to do to make sure that the programs are indeed funded?

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

Mr. Speaker, we accepted the Liberal amendment that we report back to Parliament on a regular, prescribed basis and of course we will. In fact it is in our interest to do this because we in government want this to succeed too. We are trying to overcome red tape and bureaucratic rules to get this money to people in the various areas. We are asking for the co-operation of the Liberals, the Bloc and the NDP in order to help Canadians.

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Speaker, I listened with interest to my hon. colleague's speech and the question from the Liberals, who have decided to support the government.

In a way, this is a Liberal and Conservative budget. Last week, the economic reality brought us to reel and showed us that there are indeed several industries in difficulty. Take for instance the forestry and manufacturing industries, as well as the aerospace industry in Quebec, which are especially hard hit.

Some Conservative ministers have even said of the measures that they were not adequate and that further measures are needed to remedy the situation. The Prime Minister seems to have called them to heel. At any rate, the government is really short on specifics about what its position and attitude will be.

Does the government intend to move forward with further measures to really help the forestry and manufacturing industries, as all of Quebec has been asking for quite a while, even in a unanimous motion passed at the Quebec National Assembly?

What is the government's position on how to improve the measures it has introduced, which are clearly not enough to stimulate the economy, in Quebec and in the manufacturing sector across Canada?

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

Mr. Speaker, as I said in my speech, we are suffering the economic consequences of what is going on in the rest of the world where economies are experiencing a downturn and 35% of our economy is related to exports, which includes forestry, mining, manufacturing, et cetera.

We are hoping that the budget will pass as quickly as parliamentarians will allow it to pass, because until the budget bill passes in Parliament, that is, by both the House and the Senate and the bill is signed by the Governor General, no money will flow. We need that money to flow.

In the budget there is assistance for every sector of our economy including forestry, mining and manufacturing. I realize that in the province of Quebec there are many people who are now unemployed in these various areas and others, but so are people in the rest of the country. We are the Government of Canada and we are trying to look after every province and the nation as a whole.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Speaker, a lot of students are having a hard time paying their student loans. Some of them are unemployed. They cannot find a job. Hidden in the budget implementation bill is clause 363, which is four or five pages long, which punishes students. It gives the minister the power to deny students financial assistance, deny students interest free periods, deny students deferral of payments, deny students payment of interest under subsection 9(2), deny students special interest free or interest reduced periods, et cetera.

It is filled with punishment and allows the minister to go after people within six years after the situation occurred. What does this have to do with stimulating the economy, creating jobs and protecting the vulnerable? Students are in fact vulnerable because they cannot find jobs these days.

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

Mr. Speaker, ever since it took power, this government has recognized the importance of students. Our future is to have a very well-educated citizenry who can take on all the various jobs in the world, because our future is in outperforming other countries. It is having a labour force that is better qualified to do various jobs, such as in high tech, manufacturing, et cetera, than other people in the world. That is based on education and training. The budgets of 2006, 2007, 2008 and 2009 coming up, in each of those budgets we have increased the amount of money going to education and training.

[Vic Toews, Conservative, President of the Treasury Board]

Mr. Speaker, I am quite excited about the bill and the speech by the government whip. There are all kinds of initiatives to stimulate the economy and that is very exciting.

There are Liberals who support this budget because they understand the importance of getting this money into the economy. However, I am puzzled that at the same time as we have all these wonderful initiatives in the bill, New Democrat members of Parliament are asking me if I can help support this initiative or that initiative. I say absolutely, let us get the budget bill passed. The Liberals are onside. Yet the NDP members voted against the budget, the same people who asked me if I could support this initiative or that initiative.

Can the chief government whip explain that inconsistency between what NDP members say privately to me and what they do publicly?

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

Mr. Speaker, my recollection is that the NDP has voted against every one of our budgets. It does not matter what is in the budgets. In fact, with respect to this budget, we were told by the leader of the NDP that he would oppose it regardless of what is in it.

We are about to spend $85 billion to stimulate the economy. In the budget there are an untold number of ways to help Canadians, but because the NDP chose through its philosophy to oppose the budget regardless of what is in it, that party is not going to support this budget.

[Jean-Claude D'Amours, Liberal, Madawaska—Restigouche, NB]

Mr. Speaker, I would like my hon. colleague across the way to recognize a few things. Last week, it was announced that 129,000 workers lost their jobs in Canada. The government is always trying to say that things are worse in the United States, except that, proportionally, Canada has one tenth of the U.S. population. Multiply 129,000 jobs lost in one month by 10. That makes 1,290,000. That is how many people would have lost their jobs if Canada were the size of the U.S, and that is twice as many job losses as were recorded in the United States last month.

Is the government closer to showing some flexibility regarding municipal infrastructure such as municipal garages, to ensure that our municipalities are provided with the tools they need to develop, regardless of the type of infrastructure they need?

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

Mr. Speaker, our government has consulted with the provinces and the cities to determine what they need. I think everyone will find in the basket of opportunities within infrastructure that most needs can be satisfied.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, this is the budget implementation bill. I emphasize the point that this is the implementation of the budget.

As members know, the Liberal Party has given the government a conditional pass on its budget. Part of our concern has to do with the government's competence to implement what it proposes in the budget.

The budget calls for substantial amounts of money to be spent on a stimulus package. In this bill, literally, there is a call for billions of dollars to be spent on stimuli. To be precise, it is $5.973 billion, as indicated in part 6. This is a considerable sum of money by anybody's standards.

Many of these initiatives are quite supportable and have the appearance of being good ideas. However, I would remind members that this is an implementation bill. This is a bill that would enable the government to actually spend the money.

There is a substantial consensus among economists and other Canadians that we need an economic stimulus from the federal government and that it would be welcomed in the Canadian economy. Therefore, $6 billion into the economy should put Canadians to work and should stimulate the economy. Unfortunately, the government has a very poor record of delivery.

The budget is the promise. The budget implementation bill is the delivery. The government is very good on the promise side of the equation, but it is much poorer on the delivery side of the equation.

I direct the attention of members to page 10 of the Parliamentary Budget Officer's budget 2009 economic and fiscal outlook briefing note of February 5, wherein he states:

Historically, however, the Government has experienced significant delays in delivering funds related to planned infrastructure investments.

For example, in 2007-08, the last year for which data is available, Infrastructure Canada lapsed 50% ($1.1 billion of $2.3 billion) of its non-gas-tax related funding.

“Lapsed” is government jargon. “Lapsed” in the real world means “promised but didn't spend”.

In the last fiscal year, the government promised to spend $2.3 billion, yet was only able to write cheques for $1.2 billion. If we want a stimulus in the economy, it does no good in the government's bank account. Money in the government's bank account does nothing for the economy.

If we applied the same track record to the promises contained in the budget implementation bill, we would have $6 billion promised, but only $3 billion delivered. I suppose it is not news that the government is long on promises but very short on delivery.

It gets worse. Some parts of Canada appear to be more favoured than others.

Out of the 50% delivery rate, apparently it is virtually only Conservative ridings that are in need of a fiscal stimulus. Notwithstanding that the Conservatives are a minority party in Parliament, representing about 40% of the ridings, it appears that they would receive in excess of 75% of the funding.

We are in an economic crisis. President Obama has been pouring trillions of dollars into stimulus, yet our government can only get 50% of its money out the door. Of that 50%, 75% goes to its cronies and friends. Members can see why we put the government on probation.

The idea of a stimulus is pretty simple. If we put $100 of taxpayer money into the economy, it is supposed to act as a multiplier in the economy and create at least $100 worth of economic activity and, hopefully, more than $100 worth of economic activity.

Therefore, the government is right to emphasize infrastructure stimulus, which is temporary, which is timely and which is targeted. That is the right thing to do, but its track record is one of incompetence and parochialism. There is no sabotage like self-sabotage.

For years the Liberal Party has argued that the transit pass is a complete waste of taxpayer money. We argued it when we were in government and we have argued it when we have been in opposition. It is a public policy disaster.

When I was parliamentary secretary to the minister of finance, I argued that it was a stupid waste of taxpayer money. I had Department of Finance briefing notes to back up that argument. To no one's great surprise, the Auditor General confirmed our arguments last week. In the report it said:

In its 2007 Climate Change Plan under the Kyoto Protocol Implementation Act, Environment Canada stated that the Tax Credit is expected to result in emission reductions of 220,000 tonnes each year from 2008 through 2012.

The 220,000 tonnes sounds pretty good. It was unfortunately approximately double Finance Canada's estimate of the resulting emission reductions in its strategic environmental assessment. In its 2008 plan Environment Canada amended the figure for the expected reductions to an average of 35,000 tonnes per year, about 16% of the original estimate of 220,000 tonnes when that budget implementation bill was going through.

The 35,000 tonnes is quite a reduction from 220,000 tonnes. Given the lower figure the tax credit will have a negligible impact on Canada's greenhouse gas emissions. Many factors influence public transit ridership, including the price of gasoline. The result is that it is almost impossible to measure actual greenhouse gas emission reductions attributable to a tax credit.

With regard to other emissions, Environment Canada could not provide any analysis to support the assertion that the tax credit would result in measurable impacts.

Therefore, what do we have? We have a claim of a 220,000 tonne reduction amended down to 35,000 tonnes of reduction. The report further states:

A consultant’s report commissioned by Finance Canada prior to the Tax Credit’s approval dismissed an alternative proposal because the cost to government would be excessive ($800 per tonne of greenhouse gases reduced) and the reduced fares would have little impact on transit usage. For the Public Transit Tax Credit as announced, Finance Canada estimated that the cost through tax revenue loss would be much higher, ranging from around $2,000 to $3,000 per tonne of greenhouse gases reduced between 2006 and 2010.

If we take the 220,000 tonnes, the government says that it will cost $800 per tonne. We are down to 35,000 tonnes now and it will cost $2,000 to $3,000 per tonne.

Based on this estimated cost and the lower expectations for the greenhouse gas emissions reductions in the 2008 plan, the cost per tonne will be even higher. It is not $800 per tonne, it is not 2,000 per tonne, it is not $3,000 per tonne and it may actually be much more per tonne and we cannot measure it in the first place. It is a public policy disaster and a total waste of taxpayer money, which was the argument that the Liberal government put forward when we were in government and we put forward when we had been in opposition.

Our hesitation to endorse the government's budget is well founded. The public transit pass fiasco was just one of many budgetary initiatives that used the tax system for political purposes.

Jeff Simpson in this weekend's Globe and Mail said:

It was a farcical policy, not to put too fine a point on the matter.

It was estimated that about 95 to 97 per cent of those receiving the new subsidy were riding public transit anyway. There would be no major shift from cars to buses. The money would, quite literally, go down the policy drain, which is of course exactly what happened.

As a climate-change policy, it was among the least effective policies imaginable.

It goes on to echo the devastating critique of the commissioner of the environment and it concludes:

Policies like those devastatingly dismissed by the sustainable development commissioner are a scandalous waste of taxpayers' money.

I have spent many years in this chamber. I do not know how many times I have heard Conservative members, both in opposition and in government, say that they are the protectors of taxpayer money. I would urge all Canadians to read the commissioner's report before they buy that argument from any Conservative member. This is a scandalous waste of taxpayer money with little or no environmental impact.

We have a government that has a lamentable record of getting infrastructure projects out the door. When it does, surprise, surprise, it seems to end up in Conservative ridings. The government ignores good public policy in favour of dubious electoral politics.

I know this will come as a bit of a surprise, but I do want to say something good about the government. It will not take too much time, in fact, we could probably just cut this part right out. In my view, the purchase of asset-backed commercial paper, be it mortgages, or motor vehicles leases or sales contracts on equipment, is a good idea. It must have been a good idea because the Conservatives probably did not think of it.

The overall problem with the economy is that the consumer, particularly the American consumer, has simply stopped buying. If the consumer stops buying, the entire manufacturing chain backs up and layoffs ensue worldwide as manufacturers find themselves with excess inventory and no one to buy it.

Consumers are also employers and employees. When layoffs occur, not only does the person cease to be an employee, he or she also ceases to be a consumer and the whole system loops back on itself.

It may be awhile before consumers get enough confidence to get back into the marketplace. The government can do little or nothing about confidence, but it can do something about credit. Picking up frozen credit instruments is a good thing, and putting cash in the hands of manufacturers and others at a time when cash is needed is the right thing to do.

The other attractive feature from a government standpoint is that it provides stimulus in the economy without actually ratcheting up the debt or the deficit. The assets are purchased at market value and commercial prices, so the government has an offsetting asset to go with its expenditure. In some respects it is the best of both worlds, stimulus without deficit.

I encourage the government to use its considerable leverage to purchase this frozen paper, not only to get cash into the hands of manufacturers but also to allow retailers to sell product more easily when a customer does not have the full purchase price of the product.

Just last Friday we learned that Canada had lost 129,000 jobs in the month of January alone. To give a comparator, as one of my colleagues said, that would be as if America had lost 1.3 million jobs in a month. By anyone's standard, that is a huge job loss and it is the largest number of job losses we have had in recorded history, which goes back quite a number of years. There were 129,000 jobs lost, and nearly a quarter of a million since November.

Canadians who are suffering in this recession are looking to their members of Parliament for help. We cannot let them down. The leader of the official opposition says that these staggering numbers are precisely why he has put the government on probation with his Liberal budget amendment.

During the election last fall, the Prime Minister said that it was a good time to buy stocks. He said that there was no need to run a deficit. In fact, I remember the Minister of Finance saying that he would not be the first finance minister in the last half dozen finance ministers to run a deficit and yet here we are. He also said that if we were to have a recession, it would have happened by now. We know that as he was saying that the market fell further, the Conservatives were in the red and over 234,000 jobs were lost, almost a quarter of a million jobs.

The Leader of the Oppostion said:

This government has failed to plan and failed to protect Canadian jobs. It didn’t see the seriousness of the downturn and failed to bring in an immediate stimulus package when the urgency was clear.

This budget is far from perfect. Had we drafted it, it would have been a different budget from the one we are debating today. However, Canadians cannot afford to wait any longer for the government to act. While this budget fails in some areas, some of which I have outlined, it also manages to provide some assistance that is needed. For this reason, the budget should proceed to committee without undue delay or partisan games.

The NDP decided to oppose this budget before it was even written. Canadians deserve more. Now it is time to put away partisan games and recognize that we are here to serve Canadians.

Therefore, pursuant to Standing Order 61(1), I move:

That the question be now put.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

Mr. Speaker, I would just like to ask the hon. member for his comments on a couple of ideas.

First, the government has been saying, almost ad nauseam, that because this is a global situation, somehow it has very little responsibility for remedying the situation. However, there is macroeconomic policy and there is microeconomic policy. It is important that the government get its microeconomic policies right. Once such policy would be to reform the EI system to make it more generous in recessions and less generous, perhaps, in good times. That would pump money directly into the hands of people who would spend that money right away.

Second, I know the member was the parliamentary secretary to the former prime minister and minister of finance, Paul Martin. It is my understanding that his microeconomic policy of the day helped preserve the integrity and strength of our banking system, which, today, is highly appreciated. Would the member like to comment on those two points?

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, with respect to the member's first question on EI, the government probably did the least amount possible it could with the most vulnerable in our society. When we have 129,000 people being laid off, it is just not useful to tell them that if they stay laid off long enough they will actually get an extra five weeks on the tail end of their EI.

The least the government could have done was to have shrunk the two week waiting period. That would have been step one. The second thing it could have done is the whole reduction of the regionalization of EI. If one is unemployed in Toronto, it is the same as being unemployed in Miramichi or in Cape Breton, which is another fine place to be unemployed. Regarding the argument that one person has bills and another does not and so on, the fact is that the bills are coming in the door. The two week waiting period should be eliminated and the number of hours worked should be similar across the country.

With respect to the banking system, the member is absolutely right. The former prime minister and former minister of finance did not go crazy with respect to all the rules and regulations, so we do not have the craziness that went on in the United States. We have integrity in the system. We also did not allow mergers, which turned out to be the right policy decision in hindsight.

[Guy André, Bloc, Berthier—Maskinongé, QC]

Mr. Speaker, listening to my colleague, it seems obvious that he has more reasons to vote against the budget than to support it. He gave many more reasons to vote against the budget—and I agree with some of them—than he gave to vote in favour of it.

I would like to hear my colleague's thoughts on securities. This bill would establish a Canadian securities regulation regime transition office, and the government would give this office a $150 million budget. Quebec's National Assembly unanimously voted against creating a Canadian securities commission. The Bloc Québécois intends to support harmonizing the rules of a more decentralized financial system, such as it is now. I would like to hear my colleague's thoughts on this subject.

Is this one more reason he might vote against the measures contained in this budget? Because we feel it is another very negative aspect.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, this concern about a national securities regulator has been around through two governments now and has been largely driven by the business community. The business community, both in Canada and outside of Canada, looks at our patchwork system of regulations as nonsense. We have 13 separate regulators in 13 separate jurisdictions doing, Lord knows, what all. Some set up regulations based upon best practice and some have very specified codes, and it becomes virtually impossible.

The result is that the default goes to Toronto. Toronto becomes, effectively, Canada's securities regulator by default, which we think is a regrettable thing. We think there should be a national securities regulator. The measure provided by the government is a sensible approach to what is a fractured system. We will have to see how this budget implementation measure acts itself out but, in my view, this is a step in the right direction.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Speaker, a woman earns 70¢ for every dollar a man earns but an immigrant woman only earns 56¢ for every dollar a man earns. Women, by and large, will not qualify for employment insurance and there is nothing in the budget to make it easier for them to qualify.

The budget also denies women access to the Canadian Human Rights Act. Clause 399 of the budget implementation bill states:

40.2 The Commission does not have jurisdiction to deal with complaints made against an employer....

--even if--

the employer has engaged in a discriminatory practice referred to in section 7 or 10

--or 11 of the Human Rights Act. I have heard that the hon. member and his party are against the amendment to this pay equity section. Will he or will he not move an amendment to delete clause 399 in the budget implementation bill as it has nothing to do with stimulating the economy, protecting the most vulnerable, creating jobs or protecting jobs?

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, the budget implementation bill does very little to protect the vulnerable, whether they are men or women, whether they are employed or are on their way to becoming unemployed. This has been a rather regrettable and lamentable exercise by the Conservative government. One would wish that these issues had been addressed in a more fulsome fashion by the government.

As I have said in the past, we have put the government on probation. We have a great deal of concern that what it has promised in the budget will not be delivered and, if it is delivered, that it will be delivered in a haphazard and parochial way. It will be devastating on whole categories of vulnerable people, some of whom the hon. member has mentioned.

[Colin Carrie, Conservative, Parliamentary Secretary to the Minister of Health]

Mr. Speaker, I thank the member for his comments and his party's support of the budget.

I did note that he made a little a joke about unemployment and where it occurs. I know he did not really mean to be funny but, coming from Oshawa, we are really suffering right now as far as the manufacturing sector.

In the budget, we have massive infrastructure spending. Locally, there is money put aside for cleanups, such as the Oshawa Harbour, money for roads and sewers,and help with the university.

The hon. member talked a little bit about the EI system and whether we should be eliminating the two weeks. We can debate that back and forth, and I do realize there are ideological differences, but instead of getting rid of the two week waiting period, we added five extra weeks. We also put in extensive opportunities for retraining. There is money for people who did not qualify for EI to apply for retraining. There is $500 million in the budget to help people who do not qualify under EI for retraining. My community really needs this.

The hon. member is not a person to play political games but, as he mentioned, the NDP decided to vote against the budget before they even read it. My concern is that the NDP will try to hold this up in the House for their own political ideology

Not too long ago, the Liberals were willing to get into a coalition with the NDP. Is there any influence he has that could put some common sense into the NDP so that communities like Oshawa could benefit from the budget, because we need to pass it as quickly as possible?

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, I am afraid my influence with the NDP is rather modest at this point.

The hon. member does come from Oshawa which is where I had the great honour to practise law for 22 years. I know the community quite well and I know exactly the concerns that are being faced by the folks in Oshawa, particularly those who are associated with the car manufacturing business. I share with him that concern.

The trouble is that because the government does not really pay much attention to serious policy discussion, bad choices get made. He mentioned EI. Probably, as I said before, the least the government could do was to add on five weeks at the tail end of the period. However, that is precisely it. That is all it did. We are facing 128,000 job losses and what do we get? We get five weeks at the tail end.

The government could have and probably should have eliminated the waiting period. What it could have done and should have done was eliminated the number of hours that Oshawa workers need to qualify for EI. It could have made it very similar to all of the other communities around the country that I have mentioned.

I regret that this is a budget implementation bill. The budget itself, the government takes some of the good stuff and wrecks it with some dumb ideas.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Speaker, I am pleased to have the opportunity to comment on this budget implementation bill.

Some of the Liberals liked the budget, and some did not, but as we know, all members of the Bloc Québécois voted against the budget. It is clear that the budget implementation bill does nothing to correct the fundamental flaws that made it impossible for us to support the budget.

I want to go over the major issues we disagreed with. These issues are really important because they affect everyone in Quebec.

As I was saying earlier, the proposed changes to equalization are still a fundamental issue. Proposed amendments to equalization would cause Quebec to lose $1 billion of the money it was expecting for next year, and even more the year after that. That is completely unacceptable, and I will come back to that later with some examples of how badly that will hurt us and the tough choices Quebec's National Assembly will have to make.

I also want to point out that Quebec's National Assembly passed a unanimous motion that addressed equalization. In it, Quebec's National Assembly demanded that the federal government maintain the current equalization formula as is, which included additional revenues of over $1 billion for next year alone.

As the Liberal member mentioned earlier, this bill does not fix the pan-Canadian securities commission problem. Quebec's National Assembly has conveyed Quebec's traditional strong opposition to the proposed pan-Canadian securities commission. We know that the Government of Quebec has also said that it is prepared to take the matter to court because this is about jurisdiction and the powers that belong to the Government of Quebec. Naturally, the Bloc Québécois is completely opposed, once again, to a bill that does not reverse the budget's intent in this regard.

The other major problem we have with the budget implementation bill has to do with access to employment insurance. The Conservative government wants to improve the employment insurance system, but is not going about it the right way. The government is not going to help the unemployed by giving them five more weeks of benefits.

During the debate on the budget speech, I said that people who have just lost their jobs need access to employment insurance and that the waiting period should be abolished. The two-week waiting period is what hurts the most, because people who lose their jobs—and many in my riding will lose theirs—often find a new job by the end of their benefit period, so the extra five weeks do them no good.

They will find a new job and keep on paying employment insurance contributions. Then, in another six or seven months, they might lose their job again. So every seven, eight or nine months, they are faced with a two-week waiting period, and they can never make up for those losses.

When both parents in a family lose their jobs, they are hard-pressed to meet their family obligations, such as covering their mortgage, taking care of their children's needs and paying for the cars they need to get to work. The government is not choosing the best way to help the unemployed so that they can have more flexibility and some breathing room.

There is also the whole issue of accessibility. Why did the government not make employment insurance more accessible if it really wanted to help the unemployed? In January, Statistics Canada said that nearly 40,000 jobs had been lost in Quebec alone and 129,000 across Canada. That is huge. We know we are in the midst of a crisis, and these statistics prove it.

The government should have opted for much better targeted measures to help all these people. What is more, this is happening during the winter. People's heating and electrical bills are even higher than usual. The government really did not listen and is not doing the right thing to help people.

This bill, once again, does not improve the budget or the whole question of the misguided tax cuts—and I will come back to that later—for both individuals and businesses. The bill eliminates a provision in the Income Tax Act aimed at preventing companies from using tax havens to avoid paying taxes. I will also come back to this, because it is completely unfair.

Even the current Minister of Finance said in 2007 that it was unfair and inequitable to allow companies to write off interest from some of their loans, for example, because they will invest outside of Canada. Creating jobs outside of Canada and allowing companies deductions in two separate places, that is, allowing them to twice write off the interest they have to pay, is completely unfair. The Minister of Finance said so in 2007. He said it was completely unfair. Small and medium-sized businesses as well as individuals must pay higher taxes because big businesses that invest outside of Canada are allowed to take advantage of such benefits and pay less tax. It is completely unacceptable.

The budget implementation bill still contains those measures. The minister is going back on his word. This is a scandal. It is completely unacceptable that big businesses are being allowed to take advantage of undue benefits, while unemployed workers and people who are struggling to get by every month will have to pay more taxes. We are also thinking about the next generation. As we all know, we will be facing deficits for some time. It is completely unacceptable.

The bill also opens the door to deregulation in the area of foreign investments, which in turn opens the door to foreign takeovers, without taking into account the economic interests of Quebec and Canada. Many loopholes in the budget and the budget implementation bill will allow companies and foreign investors to take control of companies that are already being well managed in Quebec and Canada. This also shows a lack of economic vision towards Quebeckers and Canadians who are perfectly capable of managing their companies.

It truly goes against the economic interests of Quebec and Canada.

In this budget, funds have been allocated for social housing. However, they are misdirected. Once again, the government has targeted the renovation of social housing. Yet, it has been stated rather clearly that there is a need for new social housing rather than renovations. There is a dire need for new housing so that demand can be adequately met. Once again, they have missed the mark.

There is a very important component with which we disagree. I am referring to that part of the bill which, in some ways, completely ignores public sector negotiations and agreements concerning compensation by imposing working conditions

A number of employees at the Shawinigan tax and research centre in my riding of Saint-Maurice—Champlain find themselves in this situation. By wanting to impose salaries, the government is completely undermining a negotiating strategy that is of tantamount importance to labour relations and that ensures that there will be good relations between the employees and their employer, the Government of Canada. Once again, the rights of these individuals are being denied. The Bloc Québécois is totally against this. It is one of the reasons why we will vote against this bill.

Earlier I mentioned that this bill will implement tax cuts contained in the budget and I stated that they are misguided. We have checked the numbers and, based on our calculations, in order for an individual to take advantage of all the cuts, they would have to earn at least $81,500 per year. You will agree that this does exactly represent the middle class.

I do not believe that tax cuts for the middle class should be calculated based on a salary of $80,000. Middle class households or families—two people who have to work in order to pay the mortgage, heating, cars, children's clothing and food—do not have an income of $81,500.

If, by chance, two people make that type of salary, they are far from middle class. Before the budget, the Conservative government told us that tax cuts would target the middle class. But the targets were poorly defined, and this issue is being completely ignored. The tax reductions should really be directed at people with much lower incomes.

The Conservatives stated this and demonstrated it in their budget on page 239: a one-dollar drop in personal or corporate taxes does not have a significant impact on economic stimulation compared with aid for the poor or investment in other areas.

They themselves have said that it will not be a big help in fixing the economy. We are in the midst of an unprecedented crisis that, in January alone, left 129,000 Canadians without work. That does not even count those who lost their jobs in the fall and—we hope this will not be the case—those who will lose their jobs in February and the coming months. Hopefully there will not be that many.

It seems as though government analysis is lacking when it comes to tax reductions.

As for businesses, I am in total disagreement with the government on one major point. In 2007 the Minister of Finance committed to eliminating double deductions of interest for Canadian businesses that invest overseas. I spoke about this earlier. Without this provision, businesses will be able to continue evading taxes with impunity. And that is what is about to happen. We see that both the government members and the Liberal members will enthusiastically support this situation. The Liberals have shown the Conservative government how it is done. So, we are not surprised, but we are saddened.

I want to point out that the Minister of Finance already backed down on that. During certain election campaigns, the Conservatives made a number of promises. They made some progress in the fight against tax havens. They even demonstrated a degree of openness by saying that they would put an end to the practice because, as the Minister of Finance himself said, it was unfair. Now they have backed down because of an advisory panel made up of people whose independence and impartiality are questionable. We know that the panel was created to determine whether it was worth introducing a measure to prevent entities from double-dipping, a measure announced by the Minister of Finance. The group was made up of six members, four of them from private corporations that could easily have taken advantage of such a strategy. For example, one member is the former president and CEO of Scotiabank, the Canadian bank with the most branches in tax havens. We think that the authors of the report are clearly in a conflict of interest.

I have listed a some of the reasons why the Bloc Québécois completely disagrees with this bill. It does nothing to correct the problems that came up in the latest budget. There is no doubt that it is a direct attack on Quebec's jurisdiction, particularly in respect of equalization.

One example of a great injustice is the issue of a single securities commission. I would also point to the inequity in the budget, which allocates $170 million to the manufacturing and forestry industries, even though Quebec's forestry industry has been in crisis for a very long time. In Quebec, the sector has been dealing with these problems for three or four years now. Yet the government is giving Ontario's auto industry $2.7 billion. I agree that there is no doubt the industry is going through tough times. However, even though Quebec has been having problems for much longer, Ontario is getting a lot more, proportionally, than Quebec.