Debates of May 14th, 2014

Finance—Main Estimates 2014-15

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, the employment rate in Canada was higher before the recession than it is right now. I am not sure if the minister is unaware or does not concern himself with that.

We are ranked fifth right now in the G7, so we are number five out of seven on employment rate. Does that concern the minister at all?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, this government is focused on a low-tax plan for jobs and growth. Employment is a critical issue, and that is why we are proud and why Canadians are proud that there have been more than a million new jobs created since the depths of the recession.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, the minister seems to be having trouble with the statistic here.

The employment rate was actually better before the recession than it is in the present day. That is a statistic that should trouble any minister.

Let us talk about the temporary foreign worker program.

Can the minister tell us the expansion of the temporary foreign worker program? I will just put it on the record. It has tripled since 2006, when the current government took office. The parliamentary budget office has said that puts downward pressure on the number of jobs available to Canadians and has decreased them in number.

Has the finance department done any analysis of the effect of the temporary foreign worker program on the number of jobs available to Canadians?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, our message to employers is clear and unequivocal. Canadians must always be first in line for available jobs. That is the basis of our temporary foreign worker program.

We have made reforms to the program, ensuring Canadians are first in line for available jobs. Our reforms include: authority to conduct on-site inspections; the ability to ban non-compliant employers; to put their names on a blacklist; to require employers who legitimately rely on the program due to lack of qualified Canadian applications to have a plan to transition to a Canadian workforce over time; to require employers to pay temporary foreign workers at the prevailing wage by removing the existing wage flexibility; adding questions to the employer LMO applications; and introducing fees for employers—

[The Chair, NDP, Joe Comartin]

Order, please. The minister's answers have to be roughly corresponding to the length of the question that was received. I think in this case, you have exceeded that time limit.

We will go back to the member for Skeena—Bulkley Valley.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, again, has the Department of Finance done any analysis of the effect of the temporary foreign worker program on the Canadian economy?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, first, let me correct something that the hon. member said about employment in comparison with the G7. In fact, we have the second highest employment rate in the G7. Therefore, his information is incorrect.

In respect of the temporary foreign worker program, the claim that one-third of all jobs gained recently went to foreign workers is based upon an incorrect report by the Canadian Labour Congress. In 2010 and 2011, the Canadian economy created nearly 500,000 jobs. Over that same period, the number of temporary foreign workers in Canada increased by about 19,000. This represents about 3.5% of the jobs created in Canada during 2010-11.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, we are missing something here. I asked if the Department of Finance had done any assessment of the effect of the temporary foreign worker program on the Canadian economy. A yes or a no would suffice.

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, I have given the hon. member the data he needs. Obviously, that data was generated from the Department of Finance.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, the former governor of the Bank of Canada warned the government that temporary foreign workers would put downward pressure on wages and undermine productivity.

Has there been an estimated cost of the temporary foreign worker program to the Canadian economy by his department?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, we believe the temporary foreign worker program, provided the companies are complying with the law, has benefited the Canadian economy.

I should note that both NDP and Liberal MPs contact the Minister of Employment on a regular basis to help companies in their ridings hire temporary foreign workers. They want to be on both sides of the issue. Privately, they want to increase the program; publicly, they criticize it.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, according to the Bank of Canada, what is the biggest domestic risk to the Canadian economy? Is the minister aware of that?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, I will let the hon. member make his case and then I will respond to it.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, it is not my case. It is the Bank of Canada making the case. It said that it was household items. I am surprised the Minister of Finance is not aware that this is the greatest threat to the Canadian economy.

What is Canada's current level of household debt, in dollars?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, the issue of consumer debt is, of course, an important one and that relates to our policies regarding the housing market because that is where the bulk of the debt is.

The total federal debt is almost $620 billion. The total net debt is $723 billion, more than that about 38.5% of our GDP and, in fact, half that of the average for the G7.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, the total figure is about $1.7 trillion, 166% of disposal income.

How much has household debt increased under the Conservatives?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, let me just point out for the hon. member that household debt is actually about $1.8 trillion. Household assets have increased significantly and are now at $9.5 trillion. Therefore, the ratio of household assets to debt is 5.3.

The median, after-tax, after-transfer income for a two-parent family with children in 2011 was $83,600, an increase of $10,000 since 2006.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, is the minister opposed to deficit spending?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, the government responded to an extraordinary international financial crisis with a robust deficit spending program, but we have emerged from that recession. We emerged in stronger shape than the other G7 countries with considerably less debt.

Now is not the time to increase the deficit. Now is the time to build a surplus for the advantage of Canadians so we can reduce interest paid, reduce taxes and allocate funds that Canadians want and need.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Chair, I asked if the minister was opposed to deficit spending.

Over the last 20 years, which prime minister oversaw the largest increase in government debt, and by how much did the debt increase?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, the largest recession since the Great Depression occurred in 2008-09.

During that time, while our robust stimulus package was being developed and implemented, the party of the member opposite and the Liberal Party urged us, again and again, to increase the amount of our stimulus package.

Had we listened to them, we would be nowhere near approaching a surplus next year. For the member to talk about the size of the debt incurred when we have been in government, when he would have urged us to spend that much more, is really a bit rich.

[Joe Oliver, Conservative, Minister of Finance]

Mr. Chair, today I will be talking about our government's economic action plan, a low-tax plan to create jobs, growth and long-term prosperity for all Canadians.

First, let me remind the committee why Canada needs an economic action plan.

Not too long ago the world was hit by an economic downturn of such magnitude that scholars called it “the great recession”, our worst economic threat since World War II. History judges us during moments of crisis, and history will smile on the way Canada tackled that threat.

We protected jobs and families. We made difficult decisions. We ran deficits to stimulate the economy. Now, we are working hard to return to balanced budgets.

The facts are clear; our plan is working. Canada, today, has never been stronger. There is bountiful evidence of our country's growing prosperity.

We have created more than one million new jobs since July 2009: over 85% full time; over 80% in the private sector. The IMF and the OECD expect Canada will be among the strongest-growing economies in the G7 over this year and next.

We continue to receive a AAA credit rating from all the major rating agencies. More than this, we are building the most prosperous middle class in the industrialized world.

A recent New York Times study found that after-tax middle-class incomes in Canada, which were substantially behind in the year 2000, now appear to be higher than in the United States.

Today, Canada is stronger and more prosperous than ever before. Leadership made this possible, the leadership of the Prime Minister who set out the road map to prosperity and continues making the tough decisions needed in our uncertain world, and my predecessor, the late Hon. Jim Flaherty, a great Canadian, whom we all miss.

The global outlook remains uncertain. Our economy has been hampered by weak export markets and lower commodity prices. Global growth is still at risk. Many of our allies are deeply in debt. Industrialized countries continue to post deficits. While new economic giants are emerging, the list of our competitors is growing. That is why we cannot become complacent. We will have to continue on the path set out by the Conservative government if we want to ensure that Canada is prosperous.

This path, our economic action plan, depends on five key pillars.

Prosperity begins with our first pillar: low taxes. Low taxes create a climate for businesses to grow. Businesses create jobs and growing businesses create more jobs. That is why our government cut more than $60 billion in taxes for job-creating businesses between 2008 and 2014. KPMG has concluded that Canada's total business tax costs are now the lowest in the G7, more than 40% lower than in the United States. Bloomberg now ranks us as the second most attractive destination for business in the entire world.

Besides businesses, we are putting more money in the pockets of hard-working Canadians. Since 2006, we have cut taxes almost 180 times. We reject opposition demands for a job-killing carbon tax. We reduced the federal tax burden to its lowest level in over 50 years. For an average family of four, taxes have been cut by close to $3,400.

However, this is not good enough. Like the Liberals and the NDP, we believe Canadians still do not keep enough of what they earn. With the Liberals and the NDP, Canadians can expect more spending and more taxes. The Conservative Party is the only party Canadians can trust to lower taxes. We have done it 180 times before and we will do it again when we achieve a balanced budget. Low taxes in business costs have helped create hundreds of thousands of jobs, but we are Conservatives. We always aim to do better.

Too many Canadians are still unemployed at a time when we are once again starting to see skills and labour shortages in some sectors and some regions. That is why the second pillar of our economic action plan supports the development of a skilled and productive workforce.

The centrepiece of this pillar is our Canada job grant. Through this program, federal funding will respond to the hiring needs of employers and will give them the opportunity to partner in skills training. While the opposition spends its time demanding temporary foreign workers for their favourite restaurants, we spend our time ensuring Canadians find jobs.

The third pillar of the economic action plan is expanding markets. I cannot overstate how central this is to Canada's prosperity. In 2013 alone, Canada exported more than $559 billion in goods and services, and that is over $16,000 for every Canadian. Since 2007, we have reached free trade and investment agreements with 30 countries, and we are negotiating many more. In 2012, Canada joined the ambitious Trans-Pacific Partnership negotiations. In March, we concluded negotiations for a free trade deal with the Republic of Korea, Canada's first in Asia.

However, the real game changer is our agreement in principle toward a comprehensive economic and trade agreement with the European Union. This is the most comprehensive free trade agreement in the history of our nation, more ambitious than NAFTA itself. The EU market, with 500 million affluent people and annual economic activity of over $17 trillion, holds a continent of opportunities for Canadians.

The joint Canada-EU study suggests CETA would boost Canada's income by $12 billion annually. Bilateral trade could increase by 20%, the equivalent of offering the average Canadian family a pay raise of $1,000.

While the NDP wastes time debating whether it supports trade, our Conservative government is getting the job done.

It is essential that we create new opportunities for Canada's natural resources sector. Natural resource projects with a total value of $650 billion will be under way or planned over the next 10 years.

The fourth pillar of the economic action plan aims to make Canada a 21st-century natural resources superpower. We are planning major new initiatives to improve safety and emergency planning, as well as to enshrine the polluter pay principle in legislation.

The fifth pillar of our plan would make Canada a global innovation leader. Since 2006, we have made new investments of over $11 billion to support innovation in every way possible, from basic and applied research to infrastructure and commercialization.

In economic action plan 2014, we propose new support for research and innovation totalling $1.6 billion over the next five years. This represents the largest annual increase in research support through the granting councils in over a decade.

These five pillars form our economic action plan. It is our Conservative way forward for Canada's economy, the only way to keep taxes low and create jobs from coast to coast to coast.

I look forward to any questions.

[Andrew Saxton, Conservative, Parliamentary Secretary to the Minister of Finance]

Mr. Chair, in the last election, our government made an important promise to Canadians that we would eliminate the deficit and return to balanced budgets. We promised Canadians we would balance the budget while keeping taxes low.

Could the Minister of Finance inform the committee why balancing the budget matters and whether or not we are on track?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Mr. Chair, I thank the member for North Vancouver for his question and his excellent work on the House finance committee.

All of the measures I just described will help secure Canada's success. However, as critical as they are, they are only as effective as the overall financial health of our country. That is why a balanced budget is critical for Canada's future prosperity.

Canadians know that balancing budgets requires a plan and the discipline to follow through, although having a trust fund makes it easier.

Budgets do not balance themselves.

The Conservative government is making the tough decisions that have to be made to balance the budget, just as families do every day. We are doing what needs to be done and we are on track to table a balanced budget next year.

Taxpayer dollars that could serve other purposes are being used to pay interest on the debt. A surplus would enable us to keep interest rates low, prepare to take on long-term challenges, such as the aging population, and cope with unexpected global economic shocks. Balancing the budget and slashing the debt means lower taxes for Canadians, and that is one of our government's top priorities. That is how it will achieve intergenerational equity.

After all, who would want his children and grandchildren to inherit his debts? Nobody. That is exactly what the Liberals and the New Democrats would do.

Canadians never expect a fiscally responsible NDP. That is the party of carbon taxes and Dutch disease. The NDP has never met a spending proposal it does not like or a spending commitment it did not want to double-down on.

Canadians today are also faced with a back to the seventies Liberal Party. On policy, that party divides its time between sitting on the fence and hiding in the weeds, smoking weed.

Our economic action plan has five pillars that have helped create more than one million new jobs since the recession. The Liberal plan has one line: the budget will balance itself.

How will the Liberals' manage that? It is a question that puzzles most Canadians. After all, at its last policy convention, the Liberal Party committed to no less than 10 new national strategies. Back to the seventies indeed.

Two of their proposals call for spending hikes worth 2% of our entire gross domestic product. That alone is almost $40 billion a year in new spending, $40 billion out of Canadians' pockets into Ottawa's pockets, never mind the other national strategies.

Canadians deserve better. They deserve a real plan to balance the budget, pay down the debt, and lower taxes. One party is delivering that to them, our Conservative Party. One leader is delivering that to them, our Prime Minister. Now is not the time for Liberal experiments. The global economy remains fragile. Our government has a plan to meet these challenges, a plan that is working, and we intend to stay the course.

[Andrew Saxton, Conservative, North Vancouver, BC]

Mr. Chair, I wanted to ask the Minister of Finance what is the biggest downside risk to the Canadian economy and the assumptions underpinning his fiscal projections, but if he only has a minute and a half to answer that, perhaps I will save that question until after I speak.