Debates of March 25th, 2013

Financial Statement of Minister of Finance

[Jonathan Tremblay, NDP, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Mr. Speaker, I know the Conservative government does not really like to say it too loudly, but it is following the example of the Liberals and learning a lot from them. It is cutting transfers in health, old age security, employment insurance, public safety and infrastructure. All that means that the provinces ultimately end up footing the bill. In addition to fobbing the bill off on the provinces, the government is unable to create a balanced budget.

Is this government capable of running a country?

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Mr. Speaker, one thing we will not do is increase taxes. We will not do what the NDP might do if it ever became the government, which is not likely to happen, and that is to increase spending by $56 billion-plus and impose a job-killing carbon tax of $21 billion. We will not do that.

We have reduced taxes and we have increased the social transfers to the provinces. My home province is included, as is the member's province. It is good management. This good management is what the public is looking for, what the public is interested in and what they will reward in 2015. Not only that, we will bring this to a balanced budget situation in 2015 without raising taxes and without imposing on the provinces and social programs.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Mr. Speaker, we know the Conservatives are increasing the payroll taxes on EI every year.

My question for the hon. member is the following. I remember way back in 2011, during the last election, the Conservatives promised that once they balanced the budget, which looks like maybe 2015 according to their prediction, they were going to double the TFSA, the tax-free savings allowance, from $5,000 to $10,000. They were also going to do some family income splitting with respect to the income tax. Those measures are obviously going to cost money and yet there are projections of surpluses starting in 2015.

Would the hon. member tell us how much it is going to cost to double the TFSA and how much it is going to cost to do the income splitting for families with respect to income tax? That will play into the surpluses the Conservatives promised back in 2011.

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Mr. Speaker, when the budget is balanced, family income splitting is not a bad idea. We certainly should look at that.

Here is what we will not do. We will not balance the budget on the backs of provinces, social programs, educational programs and the social transfers, like the Liberal government did when it balanced the budget. Not only did it balance it on the backs of those who were must vulnerable, it took about $50 billion from the EI fund to attempt to balance the budget. Anybody can balance the budget by doing those kinds of things.

We will not do that. We will do it through efficient, good management and will ensure that government operates as it should, where spending is reined under control.

[Kellie Leitch, Conservative, Parliamentary Secretary to the Minister of Human Resources and Skills Development and to the Minister of Labour]

Mr. Speaker, the member presented some excellent information from the budget.

I know he has done outstanding work as the chairman of the human resources committee and in the House of Commons. I know he has travelled across the country and has heard the concerns with respect to labour shortages in his local riding in Saskatchewan and particularly in his hometown.

Could the member comment on how this budget will address those pressing needs in his local community and how his work as chairman of the human resources committee has contributed so much to this budget?

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Mr. Speaker, I am not so sure about the latter, but I know the budget certainly addresses the fact of skills shortages.

If members go to a community like Estevan, Saskatchewan, in the southeast part of the province, people will tell them what is stopping them from expanding as they should and from becoming what they can is a shortage of human resources. There is a shortage of specific skills that cannot be filled. They are trying everything they can.

Housing is another issue. There needs to be homes for people to move into and this budget provides for that. It provides for some direct input by cash directly to support people to get trained and to get matched up with the jobs that actually exist.

It also has a number of specific initiatives that would help small and medium enterprises to continue to expand the economy, to continue to ensure that we go forward and upward.

[Dean Del Mastro, Conservative, Parliamentary Secretary to the Prime Minister and to the Minister of Intergovernmental Affairs]

Mr. Speaker, I am pleased to rise and speak to the budget. I want to thank my colleague from Saskatchewan for being so gracious in sharing his time with me so I can stand and speak on behalf of the great citizens of the riding of Peterborough, the electric city region, a place where innovation is a big part of our past and our future. This budget is really about innovation.

Immediately after the budget was delivered, I was delighted to read the comments of so many speaking in favour of this economic action plan. Third-party praise was coming in fast and furious for the budget. It must have really disappointed the opposition to hear so many leaders from across the country speaking in such glowing terms of economic action plan 2013.

I thank once again the member for Whitby—Oshawa, the hon. Minister of Finance, who has once again demonstrated that he does not just lead, but he listens, and that is what we see in economic action plan 2013.

I mentioned some of the feedback. I want to particularly note off the top the comments of His Worship Daryl Bennett, mayor of the city of Peterborough, who indicated a couple of things: the indexing of the gas tax and the long-term infrastructure dollars that have been set up to support municipalities, to support infrastructure right across the country in public transit. His Worship Daryl Bennett said specifically that he appreciated not only the indexing of the gas tax fund, but also that we had provided a long-term window for planning, which municipalities need.

He also said something else that was critically important. As a person with experience in business, he spoke about how much he appreciated that our government was fiscally responsible, that our government was headed back to a balanced fiscal situation, back to balanced budgets. The mayor of the city of Peterborough stood four-square behind this economic action plan, and I want to extend my thanks for his input into our federal budgeting process.

I talked a bit about the electric city region of Peterborough. Peterborough was nicknamed the electric city because it was the first city in North America to have electric street lights go on. It is in fact a home of innovation. It is the home of General Electric Canada and Quaker Oats. It is the home of Rolls-Royce, which has invested so much into Canada's nuclear industry. These industries are critical to Canada's financial success. These are manufacturing companies that employ so many Canadians and lead with innovative products.

When I look at Peterborough's past as a manufacturing hub and I look at our entire region, I see the creativity. I see what these companies have created. This budget is exactly the right budget for the times because it will encourage and foster that very kind of innovation, the next step of that innovation, growth in manufacturing. We are seeing that in my region with investments our government has made in the last number of years and we will continue to see it moving forward.

The budget will do a number of things.

My education is in business. I spent a lot of time studying accounting, finance and economics. One of the things I have specifically done over the last couple of years is challenge the Canadian Institute of Chartered Accountants. I have had many meetings with the institute and talked specifically about the issue of depreciation of assets.

This budget will once again extend accelerated capital cost allowances for manufacturers for investment in capital equipment, and this is important. A lot of people at home might wonder why this would matter, what this would mean to them, why this would benefit companies. There has been a big change, certainly since the generally accepted accounting principles, or GAP, was thought up. We looked at depreciation of assets and we said that an asset should be set to depreciate over its useful life. It should depreciate in a straight line, so much depreciation per year, until that asset is written off for tax purposes.

If we are going to improve Canada's productivity, if we are going to lead in innovation, if we are going to be a country that encourages investment in next generation manufacturing, then we can no longer talk about the useful life of an asset. We have to talk about the antiquated life of an asset. This is critically important because a machine can still work fine, it can still produce. I have a laptop computer on my desk which I think is five years old. It still works, but this is not current technology.

If we want to keep up with the best in the world and be as productive as we can possibly be, that is what our manufacturers are faced with. They must have that new equipment. They must be able to write it off in such a way that they can make a business case for making the investment in the first place. The banks will ask them, when they are seeking to borrow dollars, what the payback is on a new machine and what they expect to earn. That is why accelerated capital cost allowance matters. That is why the budget has, once again, made that specific measure of $1.4 billion in tax relief for manufacturers so they can invest and create jobs.

Paschal McCloskey, the owner of McCloskey International, came to me prior to the last election and said that without the measures our government had taken to reduce corporate taxes, to reduce business taxes, there was no way he would have been able to expand his company on the east side of Peterborough, which now employs over 400 people. There was no way he could have expanded the manufacturing facility because he could not compete on price globally. This company ships innovative machines around the world. It could not do it without the tax breaks we put in place.

I note today an article produced by the CBC, fine journalism on behalf of the CBC. It points out a study that has just been completed by the accounting firm PwC, the World Bank and the International Finance Corporation. What did that study find? The best country in the G8 for business taxes is Canada. We have improved from 28th position overall. Out of over 150 nations, we were 28th in 2010. This year we are eighth and we are the best in the G8 by a wide margin.

What are the effective tax rates on business in the G8 nations? In Canada it is 26.9% of profits. In the United Kingdom it is 35.5%. In France it is 65.7%. In the United States it is 46.7%. In Germany it is 46.8%. We have almost a 20% advantage over the United States.

Why does that matter for manufacturers in Canada? Why does that matter for job creators? Why does that matter in terms of attracting international investment?

It matters because in some other ways we have become a bit of a high-cost jurisdiction. Wage rates in Canada tend to be higher than they are in a lot of countries with which we compete. That is why we are putting incentives in, such as accelerated capital costs. That is why we are eliminating import tariffs on manufacturing equipment. We have put these measures in place so our manufacturers can compete globally, keep their costs low so they can continue to create jobs. Each and every manufacturing job created in Canada supports about eight other jobs in the economy. We know how important that is.

I want to talk a bit about a couple of measures, specifically for southern Ontario, that the government has invested into, programs that are in fact delivering big time, with big time dividends for the people of Peterborough, the people of southwestern Ontario, the people of central Ontario and the people of eastern Ontario. These are important investments.

The Federal Economic Development Agency for Southern Ontario will receive five years in renewed funding of $920 million. A five-year commitment for the eastern Ontario development program. That is important funding that has helped small businesses create jobs in my riding.

I talked about the important investments and commitments that the government has made with respect to infrastructure. These are critical investments to move the country forward, to build a stronger economy, a stronger Canada, a stronger Peterborough.

I will stand four-square behind this budget. It is too bad the opposition will not.

[Denis Blanchette, NDP, Louis-Hébert, QC]

Mr. Speaker, I thank my hon. colleague from Peterborough for his speech.

However, he did not mention VIA Rail. I know the member has a particular interest in the train.

Despite the $54 million investment that has been announced, the VIA Rail budget will be reduced by $287 million, which is more than a 50% reduction.

I wonder if my colleague thinks that the train has any future, in light of this kind of budget measure.

[Dean Del Mastro, Conservative, Peterborough, ON]

Mr. Speaker, I want to thank the member for his interest in VIA Rail and passenger rail in this country. The railway industry is obviously a critical one for Canada. This government has invested $1 billion in just the last couple of years into VIA Rail for its future: new locomotives, rebuilt locomotives, rebuilt rolling stock, new tracks, new stations, right across the country. These stations are of course accessible now for the physically disabled. This is so important.

However, since the budget was announced, I have had the opportunity to speak with a number of the board of governors of VIA Rail. They told me that the budget delivers on exactly what they asked for from the government. This will support VIA's operations. This will support VIA's mandate. I think Canadians can be very pleased with that.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Mr. Speaker, my hon. colleague talked about lowering business taxes. Does he know whether corporations that have had their taxes lowered to 15% are actually spending that windfall of money they are receiving?

[Dean Del Mastro, Conservative, Peterborough, ON]

Mr. Speaker, I would point to a couple of examples. For example, Tim Hortons moved its corporate head offices back to Canada after moving to the United States. It came back because of tax advantages here in Canada.

I know this is a member who advocates for job creation, and there are a number of things that we would actually agree on. Tax rates might be something we may differ on, but tax rates go into the calculus by companies when they are seeking to invest, especially global or international companies. They look at the tax rates, at the cost of doing business in any number of countries, and with an economy like ours, which has an ease of doing business, an ease in the tax system, competitive tax rates, I guarantee we will create jobs, attract investments and build a stronger Canada.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Mr. Speaker, the hon. member commented that one of the positive aspects for infrastructure was the indexation of the gas tax. I also want to comment on one of the things referenced on page 173, which is that the list of eligible investment categories will be expanded to include highways, local regional airports, short-line rail, short sea shipping, disaster mitigation, broadband connectivity, and brownfield development. I know many of the municipalities in my riding have done a lot of work on water and waste water and have now moved beyond that to other projects. Could the member talk about the importance of the flexibility of this for municipalities?

[Dean Del Mastro, Conservative, Peterborough, ON]

Mr. Speaker, when we were looking at the gas tax fund, the member for Tobique—Mactaquac was advocating on behalf of making that permanent. I know he was advocating on behalf of indexation for his communities. He is absolutely right when he says that by broadening the categories for the gas tax transfer we are providing more flexibility.

When we first became government, we inherited an infrastructure across this country that was really falling apart. However, as municipalities have been able to go about correcting some of the most glaring deficits they have had in terms of infrastructure, they have come to us and said they have other areas of priority. They have asked whether they could use the gas tax fund for other applications. In my community it was for walkways, sidewalks, improved support for pedestrians and transit, including all around the lakeshore in Peterborough. We have told municipalities that we know they have other priorities and we want to work with them, partner with them and support those priorities.

[The Acting Speaker, Conservative, Barry Devolin]

It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Charlesbourg—Haute-Saint-Charles, Employment Insurance; the hon. member for Saanich—Gulf Islands, Public Safety.

Resuming debate. The hon. member for Ottawa—Vanier.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Mr. Speaker, I will be sharing my time with the hon. member for York West.

In the 10 minutes I have, I want to cover a number of topics. First is the one I raised during question period today, which is the surprise decision by the government to eliminate a competitive advantage that was given to the credit unions and the caisses populaires in the seventies to allow them to compete with the banks on a level playing field. I also wish to touch on the federal public service, the matter of R and D, and a very important local institution, the National Capital Commission.

I will begin by talking about co-operatives.

As I said, the co-ops, credit unions and caisse populaires have a reduced tax rate. That is being taken away. They are getting a tax increase of about 36%. They are going from 11% to 15%. The reason the tax rate had been given is so that they could capitalize. Even the banks recognized that they needed it. I will quote the analyst from the National Bank Financial. He said:

Credit unions serve a different market, run higher costs partially as a result, and do not have access to capital other than retained earnings and preferred share instruments issued to members.

His name is Peter Routledge. He is an analyst at National Bank Financial, and I totally agree with him.

The reason the government had agreed to give and maintain this credit is so that credit unions could compete with the banks and offer financial services in small town Canada, where many banks had withdrawn their services. We have a situation where all of a sudden without any consultation, in the budget on Thursday credit unions and caisse populaires learned about this and wondered where it came from.

One wonders how the government justified its comments in the few pages just before that decision. These comments contradict what it had just decided, and I will quote the budget book, on page 147.

The Government will review the regulatory framework, including the process for approval of new financial institutions, to ensure that it promotes the entry and growth of smaller institutions, while preserving the safety and soundness of the sector.

However, for the safety and soundness of the sector, credit unions and caisse populaires have demonstrated their soundness.

How can the government say on the one hand that it wants to encourage entry and growth of smaller institutions, and then tax them? The credit unions were essentially small and growing credit institutions, offering services where the banks, the big six, are not, and then it taxes them. I was reading this on the weekend with my contradictory detector, and then the alarm sounded.

Where is this coming from? That is what I asked the government, and I did not get a real answer. The government changed this two months after the government acknowledged, in its written response to the special committee on co-ops that was set up by this chamber unanimously last May, and which reported to the government in September. In its response on January 28, the government said essentially that it recognized and understood that capitalization was still a challenge for co-operative businesses. Yet two months later, boom, this happens.

One could suspect that the government might have been lobbied. That is a suspicion that I have. The same gentleman I quoted made another quote that is rather astounding. This was in The Globe and Mail on Thursday. He said:

Credit unions benefit mightily from CMHC mortgage insurance so one could look at that as a federal government “subsidy” that they now have to pay a little more via the tax code.

Yes, CMHC insures mortgages, but it does for the banks as well. I want to point out, in 2008, when it was a year of some financial difficulties around the world, including in Canada, the government put $125 billion on the table to ensure the credit of banks would not dry up, via CMHC. There was $69 billion of that which was taken up by banks; hardly any of that was taken up by credit unions. The banks saying the credit unions are getting a subsidy advantage from CMHC, forgetting that they are too, is something we should be very careful of.

When people profit from investment in bank shares, they get a 50% capital gains deduction. They do not have to pay tax on the first 50%. If the Conservatives had said in their budget on Thursday that maybe that ought to be reduced somewhat, say by a few percentage points, or by 36%, the equivalent of what they have taken away from the credit unions today, I am pretty sure the phones would not have stopped ringing in the government offices. I am not suggesting we do that, but that is a basis of comparison. The members of co-ops, credit unions and caisse populaires are essentially their shareholders, and now they are being dinged by a 36% tax increase. For the shareholders of banks, that is not the case.

I have asked numerous people over the last few months if they were aware of the amount of bonuses paid to bank executives and the higher echelons in the banks in Canada. No one I have talked to knew the amounts. That has to become a known fact. Last year, it was $10.3 billion that was paid to Canadian bank executives. The year before, it was $9.2 billion. In 2008, when we had fairly serious financial difficulties and the banks were offered a loan of $125 billion, about $7 billion was paid to bank executives. Before we start taxing credit unions more, maybe we ought to consider putting a cap on the bonuses that banks can pay to themselves, as is being considered now in some European countries, Germany being among them.

I want to ensure we realize the importance in the financial system of credit unions and caisse populaires. Before the Conservatives propose doing more things, they should have had the decency of talking to them first and not just announcing the decisions. I would hope they would even want to reconsider, given the importance of credit unions in small town Canada where there are no other financial institutions.

I would like to set this issue aside for a moment and focus on the public service.

I would have liked to see an improvement in the antagonistic relationship the government seems to have with our public servants, but that does not appear to be the case. In last year's budget, members will recall that the government said it would eliminate 19,000 public service jobs. Most of the unions representing public servants agree that many more have been lost, if we include the jobs that had already been eliminated and those currently being eliminated.

The way the government is doing this is just incredible. For every job it eliminates, it drives five other public servants into uncertainty. For the 19,000 or 20,000 jobs it wants to eliminate, it will advise 100,000 public servants that their jobs could be at risk. It is spreading terror throughout the public service.

When someone receives a notice, a letter—for that is how it is done—informing them that their job could be at stake, can you imagine what must happen after that? Fear must immediately strike the hearts of these people and their families. This has an impact on the economies of the communities in which these people live. It also has an impact on productivity, when an employee knows that they have a sword of Damocles hanging over their head and that someone could cut the cord. We need to fix this.

On R and D, I have no problems with the notion of investing in the applied part of that science, but I am worried that we have been neglecting basic and pure research. The 12 Canadian scientists who won Nobel prizes did not win them for applied research; they won them for basic and pure research. I hope the government would take notice of some concerns, which are now becoming more forceful, to not abandon basic research. The DNA was basic research, and that is having a major impact down the road. There is a number of these examples. If we neglect those, down the road we will suffer. We will pay for that, so let us ensure we keep an equilibrium.

As far as the NCC is concerned, quite simply if the Conservatives are serious about keeping the NCC, then they have one thing to do and do fast, which is appoint a CEO. That position has been vacant since last summer. If they are going to have an institution that has a mandate, then somebody has to exercise that and they need a CEO.

The minister responsible for that institution needs to appoint a CEO as soon as possible if he genuinely wants to preserve the National Capital Commission.

[Jonathan Tremblay, NDP, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Mr. Speaker, we have here another deficit budget. The size of this deficit is record-setting. The Conservatives often say that they have cut taxes and this and that, but there are a lot of hidden taxes they use to find money elsewhere.

Does the Liberal Party agree with me that taking money from the employment insurance fund to pay down deficits elsewhere is a hidden tax?

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Mr. Speaker, this debate has been going on for a long time. The government is responsible for maintaining a central fund. If there is a deficit in the employment insurance fund, the government's central fund is used to make up for the deficit and, if there is a surplus, the central fund absorbs it. Therefore, my answer to the member's question is no.

Premiums should not be unduly increased, but that is what the Conservative government is currently doing. It is increasing premiums by $600 million, when that is not necessary. If I were in my colleague's shoes, I would be concerned, because the increase in premiums is a direct tax on the employer and the employee. If it is not necessary, why do it? This is what governments do to get around the situation. When we were in power, we reduced annual premiums year after year until a balance was reached. That is the answer I have for my colleague.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I am wondering if my colleague could provide comment in regard to the Minister of Finance's comments on the issue of deficit. He has been saying to Canadians, through this budget, that the government intends to have a balanced budget for the fiscal year 2015-16.

Quite simply, does the member believe the Minister of Finance? If not, why not?

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Mr. Speaker, that is quite a question.

I have some doubts. The prognostics upon which the minister bases his numbers are rather optimistic. The prognostics of increased income that he has are also quite optimistic. I am not sure we will be able to gather all the income the minister thinks can be found while the government is cutting the source that he hopes will find these incomes, and that is Revenue Canada. There are many people out there who are rather skeptical about the ability of the minister to balance the budget as he is projecting to do.

There is also the habit the Conservatives have of using the unspent amount at the end of the year and applying it to the following year. That is good if there is a fairly even level of spending. However, because of the spike in spending on the action plan and the inability to spend that money in the first year, the Conservatives have created this margin, an artificial margin, that they are trying to apply. That is not going to work. The Conservatives are going to have serious problems.

The reality is that this minister will have accumulated, during his term as Minister of Finance, the largest amount of debt that any minister of finance has accumulated in the history of our country.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Mr. Speaker, toward the end of his speech the hon. member made reference to the commercialization of education and research. He had to do it at the end because there are a lot of things to talk about and not a lot of time, mostly a lot of things to talk about that are not in the budget.

However, we looked at the overall budget, and the references to commercialization of research versus environmental are 10:1. I spoke to the internationally renowned Dr. Schindler, and he advised me that he has not received a single cent from the federal government for his very important research on addressing the environmental impacts of the oil sands.

Dr. Schindler was the first scientist at the Experimental Lakes Area. His work there led to his discovering the problem with phosphates, and that led to research by manufacturers to make a cleaner, safer soap. The research at Experimental Lakes Area led to identifying the mercury coming from coal-fired power plants, which then spurred a discussion I was part of to remove the mercury from coal-fired power plants.

I wonder if the member could speak to the problem of this unilateral look at commercialization value and science.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Mr. Speaker, the important thing there is that we keep things in equilibrium, in balance. There is a need for money to be spent in the application of knowledge, and that is the D of R and D. However, we have to keep things in balance. The trend in the last few years has been, although not exclusively, much more on the application, the applied nature of the D side of R and D, and less on the R side.

I think we have to be careful there. For instance, in 2009, a scientist in Canada who won the Nobel Prize for the discovery of telomerase at the end of DNA. That deals with longevity. The implication of that research down the road is absolutely astounding. If we as a country do not have the capacity to understand and make use of that, then we are going to pay the price.

I think all scientists would probably agree that there needs to be applied research and there also needs to be pure and basic research in equilibrium. That will serve our country and its population much better.

[Judy Sgro, Liberal, York West, ON]

Mr. Speaker, I congratulate my colleague on his comments. He has worked very hard on many of those issues and knows them well. He, myself and others in and out of the House are clearly disappointed in the so-called budget 2013. When I look at it I do not think it is worth the paper it is written on. It is too bad that the money that went into putting out all of the books the government has done, and all of the ads that we know will come, was not put back into helping Canadians. It would have gone a lot further than producing another advertising document, which is what this is all about.

Canadians coast to coast to coast are sending us emails, tweets and the rest of it about their concerns and their disappointment that there is very little in the budget, other than the recycling of a bunch of programs and initiatives.

Andrew Coyne writes critically of the government and the opposition, so he is no friend of anyone except Canadians. He said that the budget is bloated, cynical and incoherent, and that, “So much of what is wrong with this budget...simply amounts to extending previous programs, or implementing past initiatives”.

Even the Prime Minister's favourite friend, Doug Horner, the finance minister for Alberta, said, “We don’t have any new money for these types of programs”, which the Prime Minister put into the budget. Therefore, clearly there will not be new programs because the provinces do not have the money to match them.

I was also struck by the commentary from the National Citizens Coalition, a group the Prime Minister served as president. The current president, Mr. Peter Coleman, stated:

This budget plan seeks to grab headlines for relatively minor initiatives.... [I]t is discouraging that this government was not willing to commit to more far-reaching tariff reform.

There was also an article on the front page of the business section of The Globe and Mail about how the tariffs that were adjusted in this budget would have a significant impact on many other avenues of resources and things that come in that have a tariff on them, to the point where it would seriously hamper many of the retailers here in Canada.

Therefore, it seems that the government missed the mark again.

I want to be fair with respect to a few items, such as the reduction of the tariffs on baby clothes and hockey equipment. However, the government needs to take a much more thorough look. All it does is touch those little things that will get them a bit of positive publicity and those that really needed to be touched, looked at and examined so that Canada would be better off, it did not touch at all.

Canadian families now owe a record $1.67 in debt for every dollar of income. Budget 2013 would not help middle class families that are struggling. Having the minister effect changes to the interest rates would clearly affect a lot of Canadians out there who have huge mortgages and credit card debt. It was the 40-year mortgage commitment that the government made for a short period of time that certainly helped drive up the amount of debt that many Canadians are feeling.

One of the issues that we all talk about here is the employment issue in and among our youth. We are facing the worst youth job market in a generation. That means that for many of our young people getting out of school there will not be jobs out there. We have been talking about this for at least two years now. What does the government suggest? It is going to invest $19 million in an advertising campaign but it will not be creating any new jobs or new skills for youth.

We know how much the government likes to advertise its partisan ideas on the public dime, so I am sure we will be hearing a lot more with respect to that. By 2015, the government will have spent almost $1 billion to advance their economic inaction plan during events such as the Super Bowl. So much for the accountability and transparency that we supposedly were talking about. Everywhere we go we cannot go 50 feet without seeing another one of these economic action plan ads. Most of the people I have talked to know it is their own money that is being invested in more partisan propaganda instead of in people. The Conservatives should be ashamed of themselves every time they see those signs.

Youth employment is being ignored almost as much as the job market in general. Canadians want a real plan to grow the economy and create Canadian jobs. Instead, the Conservatives are repackaging existing programs, taking more money out of the economy and calling it another action plan.

In this budget, the Conservatives have prioritized spending cuts ahead of strengthening the economy and creating new jobs. We all know that the job market is still rebounding from the recession that the Prime Minister and the Minister of Finance promised would never happen. We were never going to have a deficit or get into a recession. Two months later, the recession was here and they had already blown the $13 billion surplus that they had as a result of the Liberal government.

Despite the assurances, young Canadians now have an employment rate that is five points worse than it was before the recession. We risk creating a lost generation of youth, unable to move out of their parents' homes, saddled with unimaginably high debt and with no meaningful job experience. Budget 2013 should have included a real plan to help young Canadians specifically, but it is not in the budget at all.

Now Conservative henchmen say that budget 2013 announced infrastructure, training and manufacturing programs to kickstart the economy, but what they will not admit is that these are not new programs. The Conservatives are using budget 2013 to rebrand programs that already existed. The Liberal government introduced the gas tax some years back, and I acknowledge the fact that it was indexed and I think that is a good thing. We are always being told who voted for what, but when the Liberal government introduced that in its budget, the Conservatives, not as many as there are now, voted against the gas tax.

Today I have to say I am pleased that they indexed it, except that instead of being $5.5 billion moving forward, it has been reduced to $3.3 billion. It makes it much more difficult for municipalities to move forward. Everywhere one goes, infrastructure pressures exist. The government acknowledged it is a huge thing, but we cannot expect the cities to deal with that. The provinces are under a huge amount of debt. We say we are going to do a variety of things in partnership with them, but they do not have the money either. Nobody wants to have to raise taxes, but it is what we do with the money that we have, where our priorities lie, that matters.

Budget 2013 is a hurry up and wait budget. That is what it is because the government says in five years it is going to create jobs, in five years there will be more money for infrastructure and in five years it will do a variety of things, but not today.

Speaking again of the skills training issue, I am sure the Prime Minister must have been disappointed because he talked so much about how the government was going to resolve these problems and come up with solutions. All he came up with was a whole lot of hot air.

Conservatives have invested a small amount, just over $1 million, to harmonize the recognition of skilled trade credentials across the country, yet they have done nothing to increase the graduation rates of apprenticeships, one of the most critical barriers to improving the supply of highly trained workers needed in Canada. Many young people end up dropping out of the apprenticeship program because they do not have enough money to keep going. Over 40% do not finish the program and investigations indicated that it is because they did not have the money to continue. Inadequate financing is a big issue, which is not addressed in the budget when we talk about the big skills shortage. We all acknowledge that we have one.

Why not put the money into helping people so they can get jobs, move out of their parents' homes, buy their own homes and start investing. They cannot do it if they do not have jobs. While the government spends hundreds of millions of dollars on advertising to buy Canadians' votes, it should be thinking about the many young people looking for jobs and looking to the government for some leadership rather than passing down all kinds of ideas and deals where the provinces or companies have to match the money. A lot of them do not have the money, so I do not think these jobs are going to materialize.

I am thankful for being allowed to speak about the nothing budget that I have in front of me. I just wish I could get the money out of this budget so I could put it toward helping Canadians get jobs.

[Jonathan Tremblay, NDP, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Mr. Speaker, I would like to know what the Liberal Party thinks of the Conservatives' choices.

Take, for example, the anticipated $26 billion deficit. Since 2008, the Conservatives have recorded deficit after deficit after deficit, and they call themselves good managers. I doubt that very much. On the other hand, for a number of years they have given tax credits to major corporations—$60 billion in this budget—with no requirement that the corporations reinvest the money in society. That is one of the reasons why we still have a deficit today.

What does the member think of the Conservatives' choices?

[Judy Sgro, Liberal, York West, ON]

Mr. Speaker, clearly we have a different ideology about what the role of government should be. Let us start with the choices that the Minister of Finance made. It was the same group of individuals who drove Ontario into a massive deficit as well. The exact same thing is happening here now and they will just continue. It is about the choices we make.

Canadians want us to invest money into advancing the future so we have people who can get those jobs and so we have young people who can finish apprenticeship programs and get jobs. Instead, what the government is doing is spending more money than has ever been spent. We have a huge deficit. All we need to do is go back into our history and see what was going on with the same Minister of Finance when the Conservatives were elected in Ontario and the kinds of problems we ended up with, including the deficit and the debt.

The Conservatives are doing the exact same thing for the whole country. I am appalled at their decisions. I am more appalled at the $1 billion they will have spent on economic ads when people are looking for jobs.

[Frank Valeriote, Liberal, Guelph, ON]

Mr. Speaker, currently, the federal government transfers $500 million under labour market agreements to the different provinces. With this Canada jobs grant, the Conservatives are going to pull back $300 million of that $500 million to conveniently create a fund for themselves to deploy what they call the Canada jobs grant, which will require the provinces to contribute $5,000 for every skilled worker. Employers will also have to contribute $5,000 for every skilled worker.

I have heard that the minister of finance for Alberta and the finance minister for Ontario have already indicated they are not likely to participate in this program because the provinces do not have any money.

Could my hon. friend comment on the true effectiveness of this notional skills training development through the Canada jobs grant?