Madam Speaker, I am pleased to rise to speak to this government bill. One could have a number of bones to pick with the bill, but I will focus on three.
The first is the extraordinary slowness with which the government has sent out the money, thereby having a very limited impact on jobs, as confirmed recently by the government's ideological soulmate, the Fraser Institute. The second is the lack of direct action on jobs. The third is the fact that without admitting it, the Conservatives are imposing tax hikes in a number of areas, notably a tax on jobs by raising employment insurance premiums.
While we believe these are bad aspects of the bill, we do not think they are so egregiously bad as to warrant a general election at this time. As we have said a number of times, the Liberal Party will vote against the bill, but not in sufficient numbers to provoke an election.
Let me begin on the subject of the slowness of the stimulus money. We have been saying for many months that the government should have pursued a gas tax type mechanism, which would have allowed it to quickly transfer funds to municipalities. They then would have been able to quickly get shovels in the ground and create jobs months ago when the recession was at its deepest. The government refused to do that.
We have seen evidence over many weeks and months that a small fraction of the money had gone out the door. More recent, the Fraser Institute confirmed this by saying that the government stimulus spending had little effect on jobs.
Some may know that the Fraser Institute is an arch right-wing institute, an ideological soulmate of the government. Yet the Prime Minister attacked this report with great ferocity. There are two separate points worth making in this regard.
First, as the Prime Minister himself said, fiscal stimulus was the right thing to do in the middle of the greatest recession the world has seen since the 1930s. In this respect, the Prime Minister has moved away from his traditional soulmate and joined the rest of the world in recognizing that at this time John Maynard Keynes had made a remark about return from the dead and that his kind of policy was the order of the day. In that sense, I, my party and the Prime Minister are on the same page.
The second point is it is the inefficiency with which the government carried out these Keynesian policies, which is what we are now criticizing. As the Fraser Institute study noted, the fact is very little money had gone out and very little impact on the economy in 2009 came from the government's stimulus, and not because stimulus is a bad thing, but because the government managed it ineffectively.
The worst part of the recession, hopefully, unless something gets worse, was in 2009. That was the time when the job stimulus was most needed and because of the ineffective way in which the government managed it, very little help was provided in 2009 for those desperately needing work.
The second aspect is that partly because of this ineffective action, there is still a jobs crisis in the country. Yes, the GDP has shown improvement, but what really counts for many Canadians is jobs. The unemployment rate remains at 8.2% and the recent performance for permanent jobs has been poor.
Before the budget, we had proposed to the government that it adopt a number of policies to directly promote jobs. We proposed a policy to directly help manufacturing and forestry jobs through the accelerated capital cost allowance. We proposed tax incentives to directly help youth jobs because youth face an unemployment rate twice the national average. We had also proposed a policy to help the jobs of the future in the high tech sector. These proposals were at a reasonable fiscal cost.
Indeed, we identified wasteful spending by the Conservative government in areas like partisan advertising. Had it cut that wasteful spending in addition to following to our job proposals, the net impact would have been to reduce the deficit.
The government would have none of it. It adopted none of our job proposals. At the same time, the government carried on with its partisan advertising spending. That had a second negative and unfortunate impact on Canadian jobs.
My third and final point is the Conservative government continues to claim that it is not raising taxes, but over and over again in place after place we find out it is indeed raising taxes.
I am not talking just about employment insurance premiums, but about a number of other charges as well. The Conservatives will raise Canadians' taxes with this bill, but they claim they are not raising taxes.
It is not just a question of whether tax increases are a good thing or a bad thing. It is also a question of honesty, transparency and clarity with the Canadian people when the government is proposing significant tax hikes in a number of areas while denying it is raising taxes at all.
The first and most significant of these is huge increases in employment insurance premiums, starting next year, to the point where by year four those premiums will be up by $6 billion per year. The additional revenues arising from the EI premium hikes will amount to $6 billion a year, which happens to be about the same effect as if the Conservatives were to hike the GST by one point. That would also bring in $6 billion per year.
I might note that this same issue of job-killing EI premium tax hikes is at the heart of the U.K. election campaign as we speak. The counterparts of the Canadian Conservatives, the British Conservatives, are objecting to the job-killing employment insurance premium hikes announced for the United Kingdom.
The Canadian Federation of Independent Business has estimated that these job-killing EI premium hikes will kill no less than 200,000 jobs in our country. Given the fact that we are facing a continuing crisis in jobs, this is surely a misguided policy at this time.
It is not as if the government is content to only raise taxes in the form of EI premiums. It is also raising taxes on airport security and on research. Post-doctoral research fellows who previously enjoyed a tax exemption will now have to pay tax. It is even putting taxes on toupees. The government seems to be taxing here, there and everywhere. There are new taxes on jobs, health, research and travel, while at the same time it is claiming there are no new taxes.
For these and many other reasons, the Liberal Party will oppose the bill. We oppose it because it has been ineffective and extraordinarily slow in terms of fiscal stimulus. We oppose it because it does little or nothing directly to create or save jobs. We oppose it because of the job-killing EI premium tax hikes and tax hikes in other areas, while at the same time the government pretends it is not raising taxes at all.