Mr. Speaker, as we all know, members are free to vote as they wish on this bill. As party critic, I plan to vote in favour. It does have some shortcomings, but it is, overall, a good bill.
First, the Liberal Party believes that strong regions make for a strong national economy. This bill will help those who want to go back to their region after completing their post-secondary studies. Even if the tax credit is offered for just one year, once people are settled in a region, chances are they will stay there.
On balance, this is a good law but there are a couple of weaknesses that might be addressed in committee. The definition of depressed region is perhaps too broad. Much of the county is included in that, other than the three, four or five largest cities. Maybe there is a way to more directly target regions that might genuinely be regarded as depressed. However, that is the kind of issue that can be taken up in committee.
Although the bill is essentially the same as Bill C-207 from a previous Parliament, there is a major difference in terms of the context in which we live, that is say that we now live in a time of economic crisis at a time when the government, through its budget, has provided inadequate support for the economy. We voted for it and pushed it through quickly because it was the only game in town but we saw many weaknesses in the budget.
On top of the overall positive virtues of this bill in general, the fact that it would inject more money into the economy at a time of economic crisis and at a time when the Prime Minister is now talking about totally withdrawing support for the economy in two years, it would, in an indirect way, have a positive effect.
I might take a little time on that topic because the timing of the withdrawal of the fiscal support by the government is an important issue. On page A-1 of the Globe and Mail today there is an article. It quotes at some length one of Canada's best economists, I would say, in the private sector, Derek Holt, the vice-president of Scotia Capital Inc. For the purpose of disclosure, 10 years ago, when I was at the Royal Bank, he worked for me and I came to know him to be a person of great abilities.
Derek Holt is quoted as saying the following in the Globe and Mail today, “There are many reasons to believe Canada won't recover first”, and he gives a few reasons. First, we are more “exposed to the U.S. economy than most”. Second, “the collapsing auto sector is more important to Canada's economy than it is to the American economy”. Third, “a simple rebound in commodity prices is not enough to pull Canada out of the doldrums, as some in the government have...argued”.
He goes on to say:
That's because a rise in commodity prices will bulk up the profits of existing producers, but won't do anything to bring back cancelled investments unless they stay high for a long time.
You need a global recovery to get a Canadian recovery.
This is the critical point that relates to this bill. He says:
Until that happens, Ottawa is best to let deficits run their course and do their work in reviving demand, rather than try to fight them by curtailing spending before recovery is well in hand, he added.
The greater danger lies in removing fiscal stimulus prematurely in succumbing to pressure to rein in deficits. Japan is a lesson in that regard, as it prematurely removed fiscal stimulus on two occasions during its long-lived crisis, and their economy immediately deteriorated on both occasions.
Given the apparent determination of the Prime Minister to remove the fiscal stimulus very quickly, irrespective, it seems, of the state of the Canadian economy or based on what most would regard as his mistaken belief or unlikely belief that Canada will somehow snap back first all by itself, the additional reason to support this bill is that it would provide additional fiscal stimulus for the economy.
One would hope that the government will not be the government in two years' time when these matters may come to pass but one never knows for sure. For all those reasons I, personally, and I believe many of my colleagues, fully intend to support the bill.