Mr. Speaker, I rise in the House today to debate Bill C-288, An Act to amend the Income Tax Act (tax credit for new graduates working in designated regions).
As the vice-chair of the Standing Committee on Finance for several years now, I want to point out that our committee has studied this bill many times. The committee has been through numerous consultations and amendments other than those mentioned by the parliamentary secretary, and I believe we have achieved a state of near-perfection.
Though this bill is somewhat imperfect, that is the case with most private members' bills in this place. It is no fault of anyone's, but with the private members' bills that are brought forward, there will be some imperfections because of the limited resources we have as individual members of Parliament. We are not the government. We do not have the bureaucracy behind us, so some of the bills are limited in terms of detail. We have to try to work those details out. That is the reason we send these bills to committee.
However I feel the bill does address a crucial area of the Canadian economy that the Conservative government has chosen to ignore.
The parliamentary secretary spoke about what happened in committee. The government could have taken steps to propose better legislation. It could have tabled legislation using all the resources of the government to address this issue. It could have tabled a more complete bill, a bill that would have considered the needs of regions, that would have tied regional development, along with job creation, innovation, which we have been talking about, and green technologies, to consider the needs of students and their employment futures.
Instead the government decided to shut down Parliament and go on vacation for a couple of months and came back with nothing more than a vision to change the national anthem.
Given the failure of the Conservatives to work for all Canadians, I think at this point Bill C-288 is the best option we have on the table.
To ensure a prosperous national economy, wealth must come not only from big cities. We need a broad range of skills and professions in all regions of our great country. As the member for a Montreal Island riding, I am acutely aware of the challenges facing people who live in the regions. I want to talk about the labour shortage, the high cost of transportation, the lack of public transit and other huge challenges for those who live in the regions.
Those are just some of the reasons I support this bill.
The failure of the government to propose long-term solutions to strengthen the economies of our smaller regions has led to entire communities being left behind. The costs associated with regional economic failure are too great to completely catalogue in the short time permitted for me today.
Of course these include the stagnation of economic development and growth in smaller communities, the breakup of communities as the most capable of the young people migrate elsewhere, the departure of industries as the local talent pool dries up, and increased burdens on the EI system as unemployment in the region increases.
These students sometimes not only move away from the regions into the cities but they also move away from the cities to other places and to other countries.
Bill C-288 introduces a tax credit for young graduates who settle in one of the geographic regions listed in the Regional Development Incentives Act to take up work in their field.
The tax credit can be anywhere from $200 to $750, which is a substantial amount to students who have recently completed their studies and earned their degrees and are ready to work. I do not think this measure will bankrupt the government. That kind of money will not hinder economic growth. In fact, these graduates can work in the regions and create still more jobs.
Even if they want to return to their hometowns, many new graduates cannot because they have student loans and simply cannot work for the typically lower salaries offered in the regions.
This bill would encourage many Canadians to return to their home regions after completing their studies. It would enable new graduates to benefit from a tax credit equal to 40% of their salary, up to $8,000. That is one of the things we asked for when the bill was referred to the committee.
The Bloc proposed an $8,000 tax credit. I proposed that that amount be spread over three years, in order to prevent students from returning for just one year to take advantage of the tax credit and then moving somewhere else.
The committee decided to introduce an initial amendment to spread the $8,000 over three years: for example, $3,000 the first year, $3,000 the second year and $2,000 the third year. That way, young people will stay for 12, 24 or 36 months or longer after they get their first job.
This would provide young graduates who want to ply their trades back home an adequate financial reason to do so, and at minimal cost. The provincial government in Quebec has already instituted a measure similar to the one proposed in Bill C-288 and it has been quite successful so far.
While the bill has much potential, we also talked about costs. We have had all kinds of costs and that is why the Liberals introduced an amendment that would be applicable to communities of 200,000 and less. We had a cost of $600 million and I think the Bloc came up with $160 million. We are comfortable with $160 million, so we in the Liberal Party are ready to support that.
Liberal members of the Standing Committee on Finance proposed an amendment that was approved by the member who had originally introduced the bill. That amendment ensures that the bill targets rural regions in particular, by excluding students who move to cities with a population of more than 200,000. Thus, the bill will achieve its goal, while ensuring that the cost of implementing it will be relatively low.
This amendment would ensure that the tax credit is extended only to those students who choose to settle in truly small communities, not as the member opposite, the parliamentary secretary, just suggested. Thus it helps the bill better achieve its stated goal while minimizing the costs associated with implementing the bill.
In committee we try to improve some of these bills, but the Conservatives did not help or make any suggestions when in fact we did try to work out regions or areas where this bill would be applicable. Hopefully, places like Fort McMurray would not be one of those areas, but if there was all of a sudden—