Debates of June 10th, 2014

The House resumed consideration of the motion.

Opposition Motion—Income Splitting

[The Speaker, Conservative, Andrew Scheer]

We were moving to questions and comments for the hon. member for York South—Weston.

Questions and comments, the hon. minister of state.

[Gary Goodyear, Conservative, Minister of State (Federal Economic Development Agency for Southern Ontario)]

Mr. Speaker, I enjoyed listening to the member's comments earlier, but I have to admit I have absolutely no understanding of where he is going with his comments. I know that when I was elected to come to the House of Commons, it was to actually protect taxpayers from governments that were charging too much money. It appears that he is objecting to more tax cuts for Canadians.

What I am asking the member to do is consider the totality of what this government has done with its tax cuts. The economic action plan is a strategic year-over-year plan that includes the reduction of taxes, over $200 billion less in taxes to Canadians as a result of this Conservative government.

One plan does not meet all needs and that is why we have reduced taxes for farmers, families, seniors, students, just name it, small businesses, apprentices, people with disabilities, et cetera. Now we have another opportunity to add yet one more piece to the puzzle that represents quality of life for Canadians.

Why does the member not have the ability to put it all together and think about the bigger picture?

[Mike Sullivan, NDP, York South—Weston, ON]

That is just what I am doing, Mr. Speaker. I do think about the bigger picture. The bigger picture clearly is that people who are at the low end of the economic spectrum would expect that the government would take the $5 billion and share it on a more equitable basis than just giving it to the most wealthy in this country. The most wealthy in this country do not need that $5 billion, and that $5 billion will come out of the pockets of the people who are all across the spectrum, including the poorest in this country. It is absolutely unforgivable that we take money from the pockets of the poor and give it to the rich. That is the opposite of what we should be doing.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, income inequality is an important issue. It is an issue we attempted to address in the House, from the Liberal Party's perspective, two years ago when we made the suggestion that we needed to get the committee to come up with tangible recommendations that would make a difference, to try to close the gap.

One of the most important things to recognize is that we need a holistic approach. We need to get the provinces and the federal government looking at policies that would, in fact, close the gap. Political parties, whether they are New Democrats, Conservatives, or Liberals, have at times fallen short.

My question for my colleague is this. Would he not acknowledge how important it is that we take a look at policies in taxation, a joint responsibility between provinces and the federal government, so that the provinces and Ottawa have the ability to make a difference and close the gap on income inequality?

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, the income inequality gap will not be closed by this Conservative action in any way, shape, or form. In fact, it is making it even worse. It is taking money from the poor and giving it to the rich. That is something the Liberals and Conservatives have been doing for the last 30 years. We need to stop this merry-go-round of taxing poor people so that rich people can get richer. That is the exactly the opposite of what we should be doing.

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

Mr. Speaker, it is an amazing phenomenon to watch Conservative speaker after speaker reference Canadians broadly as benefiting from this very narrow and very expensive income splitting scheme. The Conservatives keep omitting that 86% of all Canadian families will see no benefit whatsoever. Of those families who happen to qualify, who happen to fit into the narrow definition as proposed by the Conservatives, only a few of them will see the maximum benefit, and that would be those families and those individuals who happen to earn more than $150,000, like some members of Parliament. For average working families, if they are in the same tax bracket, if it is a single mom or single dad, if they do not have kids, or if the kids have moved out by 18, all of these Canadians, that is the 86% that we are talking about.

Given this vast amount of money, $5 billion out of the treasury to help Canadian families make ends meet, have that opportunity gap narrowed so that those who are born into lesser circumstances can achieve more through hard work, what kinds of suggestions would New Democrats offer to Canadians as opposed to the narrow ideology we see from the Conservatives?

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, the Conservatives rejected our very thoughtful proposal to create a national housing strategy. Most of the individuals in the city of Toronto who live in the big towers are close to being homeless.

Five billion dollars would be almost all of the money required to make sure that every family in this country was housed appropriately.

That is the kind of thing that the New Democratic Party would look at doing if we had $5 billion left over at the end of the day.

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

Mr. Speaker, I am pleased to have this opportunity to address the motion before us today. Hon. members of the House may differ on solutions, but I am sure we can all agree that we must continuously look for ways to improve the lives of all Canadians. However, while the opposition would have one believe that our government is doing little to help families, I will take this time to correct the record.

Frankly, the facts speak for themselves. Under this Conservative government, Canadians in all income groups are better off. Canadian families, at all income levels, have seen increases of about 10% or more in real after-tax, after-transfer incomes across the board since 2006. The lowest-income Canadians have seen a 14% increase alone during that same time period.

Income inequality has not increased in Canada since 2006. In fact, it has decreased. Canadian families, at all income levels, have had higher incomes after taxes, after transfers, and after inflation, in 2011 and prior to the recession.

Furthermore, the median net worth of Canadian families has increased by almost 45% in real terms since 2006.

While the opposition continues to pose high-tax schemes that would actually increase income inequality and leave less money in the pockets of Canadians, our government is actually taking action and standing up for Canadian families.

Our Conservative government has been clear that one of the most effective ways to support Canadian families is by providing tax relief. It does not stop there. Our government has seen to it that the federal tax burden is at its lowest level in over 50 years. We have removed over one million low-income Canadians from the tax rolls completely. We have introduced nearly 180 tax relief measures since we took office in 2006, reducing taxes in every way the government collects them.

Let me list a few of them.

We have reduced the GST from 7% to 5%. That is a 27% reduction in GST, putting more than $1,000 back into pockets of the average Canadian family.

We have introduced the landmark tax-free savings account, the most important personal savings vehicle since RRSPs. I must point out that more than nine million Canadians have since opened a tax-free savings account.

We have introduced the child tax credit, a credit on an amount of $2,255 for each child under the age of 18.

We have introduced the universal child care benefit, offering families more choice in child care by providing up to $1,200 a year for each child under the age of six.

The NDP members who stand today and claim that they know what is best for Canadians voted against every one of these measures. The opposition will continue to reject our efforts to keep taxes low. That is the reality we face. The opposition prefers that we adopt dangerous economic policies that would kill business investment and jobs, and hurt Canadian families by taking more of their hard-earned money.

We will not take economic lessons from the opposition. Let me remind the opposition that under our Conservative government, we have seen the benefits of Canada's economic action plan. Canada's economy has seen one of the best economic performances among all G7 countries in recent years, both during the global recession and throughout the recovery. This was due to strong economic leadership, fiscal discipline, long-term thinking, and tough decisions.

With that, I would like to take the rest of my time today to expand upon a few of the very important measures my colleagues on this side of the House listed earlier today.

To begin, let me take members back to budget 2007, when our government introduced the working income tax benefit, the WITB. The WITB fulfilled our government's commitment to help make work more rewarding for low-income Canadians already in the workforce. It increased the incentive for other low-income Canadians to enter the workforce, as well.

Economic action plan 2009 went even further by effectively doubling the benefits provided under the WITB.

Today, this initiative is making a real difference in the lives of Canadians. It has lowered the welfare wall so that low-income individuals now keep more of their earnings. In 2013, over $1.1 billion in WITB benefits were provided to individuals and families alone. Up to 1.5 million working individuals and families receive assistance through the WITB.

Recognizing that families are the cornerstone of our society, economic action plan 2011 took action to further reduce the tax burden on hard-working Canadian families. In doing so, we recognized that some families need additional support. For example, many Canadians have assumed added responsibilities by caring for infirm parents or other family members. Our government felt it was important to assist these family caregivers who make special sacrifices, often leaving the workforce temporarily and foregoing employment income.

In support of these families who care for infirm dependents, economic action plan 2011 introduced the family caregiver tax credit, which came into effect in 2012. This 15% non-refundable credit on an amount of $2,058 in 2014 provides additional tax relief for caregivers of all types of infirm dependent family members, including for first-time spouses, common-law partners, and minor children.

To further help caregivers, economic action plan 2011 removed the $10,000 limit on the amount of eligible expenses a taxpayer can claim under the medical expense tax credit for a financially dependent relative.

Our government also recognizes that persons with disabilities specifically need assistance as well. Our support for them has been targeted and effective. This is evident through such programs as the enabling accessibility fund, which has funded over 13,000 community-based projects across Canada, totalling over $89 million.

Even as recently as the measures in economic action plan 2014, our government has proposed to connect persons with disabilities with jobs by providing $15 million over three years to the ready, willing and able initiative of the Canadian Association for Community Living as well as $11.4 million over four years to support the expansion of vocational training programs for persons with autism spectrum disorder.

That is not all. We also established the highly praised registered disability savings plan, or RDSP, based on the recommendations of the 2006 expert panel on financial security for children with severe disabilities. The RDSP is designed to help individuals with severe disabilities and their families save for their long-term financial security. Since its implementation in 2008, our government has made a number of improvements to the program. For example, to make sure that RDSP beneficiaries with a shortened life expectancy could access their savings, economic action plan 2011 provided them with more flexibility to withdraw their RDSP assets without requiring the repayment of Canada disability savings grants and Canada disability savings bonds.

In 2011, our government launched a review of the RDSP program to ensure that RDSPs were meeting the needs of Canadians with severe disabilities and their families. Based on the feedback received during the review, economic action plan 2011 announced a number measures to improve the RDSP. These measures provide greater access to RDSP savings for small withdrawals, give greater flexibility to make withdrawals from certain RDSPs, ensure that RDSP assets are used to support the beneficiary during his or her lifetime, enhance flexibility for parents who save in registered education savings plans for children with disabilities, introduce greater continuity for beneficiaries who cease to qualify for the disability tax credit under certain circumstances, and improve administration of the RDSP for financial institutions and beneficiaries.

Since becoming available in 2008, more than 81,000 RDSPs have been opened. Thanks to measures like the RDSP, our government is making sure that Canadians with disabilities get the support they need. A lot of credit should go to the late hon. Jim Flaherty, who championed this program.

Let me now say a few more words about the government's tax reductions for seniors and pensioners. Once again, on this subject I have plenty of material to draw from.

Since 2006, our government has increased the age credit amount by $1,000 in 2006 and by another $1,000 in 2009. We have doubled the maximum amount of income eligible for the pension income credit to $2,000.

We have introduced pension income splitting for seniors and increased the age limit for maturing pensions and RRSPs to 71 years of age from 69 years of age, and much more. As a result of these actions, seniors and pensioners are receiving about $2.8 billion in additional annual tax relief. Overall, actions taken by this government have substantially increased the income seniors can earn before they are required to pay income tax. In 2014, a single senior can earn at least $20,050, and a senior couple at least $40,108, before paying any federal income tax at all.

Seniors and those who support them may also take advantage of tax credits, such as the disability tax credit, the medical expense tax credit, and the caregiver credit as well as the family caregiver tax credit, which, as I mentioned, was introduced in economic action plan 2011 and came into effect in 2012.

In the same year, our government enhanced the guaranteed income supplement, the GIS, for those seniors who rely almost exclusively on their old age security and the GIS and may therefore be at risk of experiencing financial difficulties. The measure provided a new top-up benefit of up to $600 annually for single seniors and $840 for couples and is improving the financial security of more than 680,000 seniors across Canada. This increase in economic action plan 2014 was the largest increase for the lowest-income GIS recipients in a generation.

That is not all. Our government, since 2006, has also lowered taxes in a number of other very important ways for families. It has increased the amount of income all Canadians can earn without paying federal income tax, increased the upper limit of the two lowest personal income tax brackets so that individuals can earn more income before being subject to higher tax rates, and reduced the lowest personal income tax rate to 15% from 16%.

Our Conservative government has been ambitious in our low-tax agenda. It is aimed at creating a tax system that fuels job creation and economic growth in the economy, and as I mentioned previously, it allows Canadians to keep more of their hard-earned money. Tax reductions have also given individuals and families the flexibility to make choices that are right for them. While the opposition members argue that we are only helping higher-income Canadians, this could not be further from the truth. Low- and middle-income Canadians are receiving proportionately greater relief. Benefits for low- and middle-income Canadians delivered through the personal income tax system, and support for families with children, have also been increased and enhanced under our government.

Finally, let me add that new measures we have introduced recognize that the health of the Canadian economy ultimately depends on providing opportunities for a high quality of life for all Canadians. That is why economic action plan 2014 would continue to implement the government's plan for jobs and economic growth. It would connect Canadians with available jobs and help them acquire the skills that will get them hired or get them better jobs in the marketplace; foster job creation, innovation, and trade by keeping taxes low; reduce the tax-compliance burden; continue to provide Canadian businesses and investors with the market access they need to succeed in the global economy; and support families and communities by taking additional steps to protect Canadian consumers, keep taxes low for families, and improve the safety of Canadians.

To conclude, keeping taxes low is an important element of our economic action plan. It helps Canadians succeed in the global economy through the creation of high-quality jobs and greater opportunities for success. Economic action plan 2014 is the next chapter in our government's long-term plan to strengthen the Canadian economy in an uncertain world and to create jobs and growth while keeping taxes low for families and businesses and balancing the budget in 2015. It is clearly working. It is accomplishing what it is intended to do, and by returning to balanced budgets in 2015, it bodes well for not only the current generation of Canadians but for future generations as well.

Taken together, the measures our government has introduced since 2006 and those in economic action plan 2014 will continue to keep taxes low and help Canadians succeed in the global economy, creating jobs, growth, and long-term prosperity for all Canadians.

A recent analysis by The New York Times and the Luxembourg Income Study suggests that Canada's median income households today are the richest of 20 peer countries, including, for the first time ever, the United States. It also shows that Canada's median income households saw increases of about 20% in their take-home incomes between 2000 and 2010.

Even the Parliamentary Budget Officer tells us that we have delivered $30 billion in tax relief, which is benefiting low- and middle-income Canadians the most. Again, this is leaving more money in the pockets of hard-working Canadians, and in 2014, that saving is to the tune of nearly $3,400 for an average Canadian family.

Our record on tax relief is strong, and the results are speaking volumes. However, we have been clear that once the budget is balanced, our government is committed to even further, even greater, tax relief for Canadian families.

I encourage the opposition, once and for all, to put aside its reckless high tax, tax-and-spend agenda and support our government's efforts to help all Canadians at all income levels.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I thank my colleague for his speech, even though it was just a long series of slogans. It did not contain any facts, except for when he was bragging about the supposed measures that would help the middle class.

Let us get down to business. The fact of the matter is that the middle class has been deeply in debt for many years. Under this government, household debt has increased and reached 165% of income. This is a very significant indicator of the poor financial health of Canadian households.

However, the government keeps pushing for tax cuts, especially for corporations, which cost the treasury tens of billions of dollars. It dramatically increased the amount of dead money in companies' coffers, which did absolutely nothing to stimulate the Canadian economy. On the contrary, incomes are still stagnating.

How can I make my colleague understand that he is on the wrong track? How can I make him realize how bad the situation is for the majority of Canadian households?

[Andrew Saxton, Conservative, North Vancouver, BC]

Mr. Speaker, my hon. colleague talks about household debt, and yes, household debt is a concern. The majority of that debt is in mortgages. That is an investment that will be going up in value over the years. With low interest rates, Canadians are able to afford that.

We have also been cautioning Canadians that interest rates will eventually go up, and they should be prepared for that scenario. When it comes to the actual net worth of Canadian families, Statistics Canada found that the median net worth of Canadian families has actually risen by almost 45% since 2005. This is a significant improvement in the wealth of Canadian families, who are benefiting from the policies of our Conservative government.

The proof is in the numbers. We have lowered taxes over 160 times, and the average Canadian family will have $3,400 more in its pockets this year than it would have had under the previous government.

[Gary Goodyear, Conservative, Minister of State (Federal Economic Development Agency for Southern Ontario)]

Mr. Speaker, one of the problems we have here is that members ask for more debate, but then they do not listen to the debate or they do not show up for the debate.

The member just gave a great speech about the totality of the taxation reductions the government has given. He used the number 160, which is the number I use, but I have just done a little more research, and it is actually 180 times our government has lowered taxes for Canadians.

This is just another opportunity to lower taxes for Canadians. We have done it for seniors. We have done it for families. We have done it for children. We have done it for students. I know that students in Canada can now earn just over $20,000 without paying any federal tax. That takes individual policy changes. Here we are talking about yet one other opportunity to lower taxes for Canadians to continue our government's plan to improve the quality of life for Canadians.

I wonder if the member could mention one more time how much the average family in Cambridge and North Dumfries is saving as a result of this side of the House voting yes to tax cuts, but unfortunately, that side continuing to vote no.

[Andrew Saxton, Conservative, North Vancouver, BC]

Mr. Speaker, my hon. colleague was absolutely correct. In fact, we have reduced taxes almost 180 times since this speech was written. This shows how quickly we are lowering taxes for all Canadians.

To answer his question specifically, we have lowered taxes. The average Canadian family will have $3,400 more in their pockets at the end of 2014 as a result of our low-tax plan for Canadian families.

In addition, I should also point out that Canadian families at all income levels have seen increases of about 10% or more in their real after-tax, after-transfer income since 2006. It is the lowest-income families that have benefited the most, with a 14% increase in that period of time.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I listened to what the Minister of State for the Federal Economic Development Agency for Southern Ontario had to say and the question he asked the Parliamentary Secretary to the Minister of Finance, and it was rather unbelievable.

It is all very well to list 180 tax measures, even though some are still very marginal, but this does not address the heart of the matter. The indicators are very clear and the situation has deteriorated rather quickly. There has also been a dramatic increase in income inequality, and it has happened much more quickly in Canada than in the United States, regardless of what the studies might suggest.

Let us be sure to put things in perspective properly because some studies—and I know which study the hon. member was talking about—can skew information. In the meantime, Statistics Canada has found that the middle class has been hard hit and the decline is far from slowing down. The foundation of our motion has to do with the growing income inequality. Income splitting will only help the rich because more than 90% of households will not benefit or will only slightly benefit from this measure.

Why is this government trying to do everything it can to help the wealthy?

[Andrew Saxton, Conservative, North Vancouver, BC]

Mr. Speaker, the only income splitting the member opposite understands is the splitting of Canadians' hard-earned income from their pockets.

Our government believes that income splitting has been good for seniors and that it would be good for Canadian families as well. We have not balanced the books yet, but once we balance the budget, we will look at all ways of reducing the tax burden on Canadian families.

Under this Conservative government, Canadians in all income groups are better off. Middle incomes in Canada have surpassed those in the United States for the first time, putting Canadian median incomes near the top of global rankings.

Canadian families in all income groups have seen increases of about 10% or more in their real, take-home, after-tax pay since 2006, and the median net worth of Canadian families, as I mentioned, has increased by almost 45% since 2005.

Our low-tax plan for the economy and for jobs is working for Canadians.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, it is the home of some of the international award-winning wine, so I appreciate the opportunity to ask a question of my hon. colleague from British Columbia, from North Vancouver, another beautiful part of our province and our country.

I thank him for the great work he has been doing. I know he had worked closely with our former colleague, Minister Flaherty, who had a memorial service in the other House yesterday. I think about the great foundation he laid to help our seniors, low-income people, middle-income people, and persons with disabilities, as well as his passion for his registered disability savings plan.

I have been working on another issue for eight and a half years. I have been working on the trade committee, and we have this historic 21st century trade agreement that we signed with the European Union in the fall.

I wonder if my hon. colleague could share with the House some of the positive effects for low- and medium-income families and individual Canadians, as well as the economic opportunities for average Canadian families that this comprehensive economic trade agreement with the European Union will provide.

[Andrew Saxton, Conservative, North Vancouver, BC]

Mr. Speaker, I thank my hon. colleague for the excellent question and for the excellent work he does on the trade committee.

This trade agreement, the largest in Canadian history, will have a significant impact on our economy. In fact, we expect that over 80,000 jobs will be created as a result of this free trade agreement.

It means that Canada would be one of only a few countries in the world that would have free market access to both the United States and the European Union. That is over 800 million consumers that Canadians businesses would have access to on a free market basis.

We can imagine the number of jobs and the number of opportunities that would be created as a result of this ground-breaking free trade agreement. It brings over 20 countries from the European Union into a free trade agreement with Canada, and we look forward to signing that agreement and having it put in place.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr. Speaker, as a woman and the chair of the Standing Committee on the Status of Women, I am pleased to rise in the House today to support this NDP motion decrying the increase in income inequality in Canada under successive Conservative and Liberal governments and stating the NDP’s position on the Conservatives’ income splitting proposal.

Pardon the pun, but there is a split between the perspectives of the Conservatives and the New Democrats. The Conservatives seem to want to return to the 1950s, as evidenced by the many retrograde initiatives they bring in. They are nostalgic for an era when the traditional family—as portrayed in the famous U.S. television series Leave It To Beaver—cast women in the role of housewife.

I was born in the 1950s, but I must admit that, as a woman, I am in not at all nostalgic for that period. Not only am I proud that, over the years, women have been liberated through numerous struggles, I am also proud of women’s participation in the labour force, their financial autonomy, and their political and economic leadership.

However, we must not become complacent: although Canada ranked first in the area of gender equality according to the United Nations Human Development Report for the decade from 1990 to 2000, since 2001 Canada’s ranking has plummeted to 20th and 31st, respectively.

How is it that a progressive and modern nation like Canada could become a global laughingstock in the area of gender equality? Successive austerity budgets, starting in the mid-1990s, and recent fiscal policies have only widened the gap between the rich and the poor and deepened economic disparities between men and women.

Even though about 70% of mothers with children under the age of five work, their employment rate is still far lower than that of fathers, according to Statistics Canada. In my opinion, it is our responsibility as parliamentarians to introduce policies to restore balance and establish working conditions that make it possible for parents—not only women—to balance work and family.

In Quebec, the child care program has led to the creation of good jobs, and a 9% rise in mothers’ labour force participation. The program has also benefited the economy because every dollar invested has boosted the GDP by $2.30, according to a study by the Université de Sherbrooke.

Since the Conservatives announced their intention to fulfill their pledge to institute income splitting, as a former coach of the Canadiens would say, a lot of ink has gone under the bridge.

I would like to quote a number of newspaper headlines. Le Devoir published two articles: “Income splitting: The wrong track” and “Federal taxation: Income splitting lines the pockets of the wealthy”. The Globe and Mail ran a article with the following headline:

“Probing the pledge: The Tories' flawed tax break for families”.

One recent report states:

“The Big Split: Income Splitting's Unequal Distribution of Benefits Across Canada”. From the Progressive Economics Forum, we have “Income Splitting: A Bad Idea Returns”. Then there is “Income Inequalities in Canada: Fiscal and Gender Dimensions”, a briefing paper to the finance committee, and “Income Splitting in Canada: Inequality by Design”, from the Canadian Centre for Policy Alternatives.

Even the C.D. Howe Institute came out against this measure.

Barrie McKenna stated in The Globe and Mail that this measure was seriously flawed because it would mainly benefit the wealthy.

A recent Broadbent Institute study, based on Statistics Canada data, shows interesting regional disparities. In particular, the study shows that most of the couples who would benefit from this measure are in Alberta and Saskatchewan. If I may say so, that is fertile territory for the Conservatives. It comes as no surprise that these measures would be less beneficial to provinces like Prince Edward Island and Quebec.

The C.D. Howe Institute's comments on this are as follows:

The measure would:

...fail to achieve its particular notion of horizontal equity, likely by overtaxing dual-earner couples. It would also distribute gains disproportionately to a small share of all households (mostly at the highest incomes), fail to assist families that most need help..., and create new distortions to work incentives.

I must pause to announce some good news, which is that I will share my time with the hon. member for Trois-Rivières.

I will continue with quotes that denounce income splitting. Economist Erin Weir pointed out the significant impact that this measure would have on the federal government's revenues:

Another aspect of the proposal that should be questioned is its likely impact on provincial governments, whose taxes generally apply to income as defined by federal tax rules. If it would reduce annual federal revenues by $2.5 billion, it could also reduce combined provincial revenues by about a billion dollars.

Mr. Weir then continued by asking:

The Conservatives have promised to wait until the federal budget is balanced. Would they also wait until provincial budgets are balanced?

It seems to us that these revenues could be judiciously used to promote increased labour market participation by parents and greater recognition of work that is currently unpaid.

These revenues could also be used to reduce the gap between the rich and poor, a gap that is growing very rapidly in Canada, where 86 Canadians have the wealth of the 11.4 million poorest Canadians and where 14% of the country's total revenues go into the pockets of the richest 1%.

The Conference Board of Canada stated:

Do government taxes and transfers help to reduce inequality?

Yes. Personal income taxes and government transfers (such as social assistance, employment insurance, child benefits, and old age security) have helped to reduce income inequality.

No one can say that the Conference Board of Canada is leftist.

To conclude, the federal government has the means at its disposal to reduce inequalities and propose measures that will benefit all taxpayers, not just a narrow group of Conservatives. We believe in a sustainable and equitable economy, which includes a fairer, simpler and more progressive tax system.

Canadians are social democrats. They recognize the importance of the fair sharing of wealth, the value of work and fair compensation.

They recognize the importance of creating a climate conducive to full employment for everyone. They also want to be able to look after their families and loved ones, whether as parents or caregivers. It is therefore the moral responsibility of the government of a prosperous country such as Canada to foster a climate that will help our country become a country without inequalities, a country where prosperity will be accessible to all.

[Gary Goodyear, Conservative, Minister of State (Federal Economic Development Agency for Southern Ontario)]

Mr. Speaker, if I may offer a very sincere compliment, I find it hard to believe the member was around in the 1950s.

The NDP seems to have taken on this charge about the Conservatives wanting to return to the 1950s as if it is some kind of a bad thing.

Currently, under various policies by this government, we have some of the lowest federal corporate tax rates in the G20. We have the first entirely tariff-free zone for manufacturers. We see less children in poverty. We see less seniors paying any federal tax whatsoever. Right now, I think it is fair to say that we have the best, most fertile economic landscape in our country for business growth since the 1950s.

What we would not disagree with is that, of course, we would like to see taxation on Canadians all across the country as low, if not lower, than it was in the 1950s. If we want to go back to the 1950s, let us lower our tax rates to meet that criteria. This is one piece in the puzzle in doing that.

Why can the NDP not vote yes to at least one lowering-tax initiative by the Conservative government?

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr. Speaker, I think the double taxation in the 1950s was probably higher.

He actually did not listen very carefully to my speech because, since the Conservatives and the Liberals came to power in the late 1990s, the gap between the rich and the poor has widened. We are talking here about poverty—there are more and more inequalities—and the government's role in sharing the wealth. In fact, the beauty of our federal system is the redistribution of wealth to reduce these gaps between the rich and the poor. I believe this government has completely abrogated its moral duty as a government to ensure that, regardless of where we live or the circumstances in which we were born, we have our fair share of that wealth.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, the redistribution of wealth is a critical issue in all regions of our country. Income inequality frustrates a great number of people. We need to recognize that, yes, there is a role that Ottawa and our provinces have to play.

Earlier today, for example, I mentioned the 10 years in which the NDP was in government in British Columbia and the income inequality was a whole lot worse. British Columbia was number four, but it was driven to number 10 as being the worse province in Canada. I say that because it draws into the comparison that it is the political will of the leadership.

When we have individuals coming forward saying that they want to deal with income inequality, maybe one way we could do that is by ensuring we look at the shared responsibilities of taxation policies and so forth. Would the member want to provide some comment on how important it is that Ottawa work with different stakeholders, particularly the provinces, to ensure there is less income inequality in all regions of our country?

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr. Speaker, in a confederation, the federal government's role is to ensure that it meets with the provinces. I would even take it further than that. Cities are increasingly being called upon to play a very important role, not just in the Canadian economy, but also in the fair distribution of wealth.

My colleague spoke about housing.The federal government and its partners need to find common solutions to the challenges Canada is facing. It needs to show some goodwill.

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Speaker, I think this is one of those rare opportunities when the House can take preventive action.

Since I and many of my colleagues were elected, we have often stood up in the House to criticize bills that have been introduced. However, today's motion has come at a time when we are expecting a balanced budget to be announced in 2015. We know that our budget is nearly balanced right now. If we compare the provisions accumulated with the deficit announced, we are essentially breaking even.

For once, we have the opportunity to tell the government in advance that a policy it is trying to implement does not make sense, even if the idea of it initially sounded good. For the benefit of those watching us a few hours or days later on CPAC or in the media, I want to quote the motion we are discussing today:

That, in the opinion of the House, the drastic increase in income inequality under recent Liberal and Conservative governments harms Canadian society; and that the House express its opposition to the Conservative income splitting proposal which will make this problem worse and provide no benefit to 86% of Canadians.

Everyone here seems to understand what income splitting for tax purposes means because we have been talking about this bill and thinking about this issue for weeks and months. However, for the average person in my riding and many others, who often struggles to do his or her own taxes, this notion might be somewhat abstract. I will therefore put my teacher's hat back on for a few minutes and try to give a simpler explanation of what income splitting is, so that everyone can follow the debate.

Income splitting is a very simple accounting procedure that would allow spouses to transfer up to $50,000 between them for tax purposes. If this little shell game were adopted, one member of the couple would pay less taxes because he or she would be in a lower tax bracket.

What is the purpose of this? It is to reduce the amount of taxes a couple or family pays. On paper, there seems to be little to criticize about this measure, since this tax arrangement would benefit families. However, it would not benefit all families, and that is where things start to go wrong.

This is what I would refer to as one of the Conservatives' so-called good ideas. Why is that? This idea is a promise that the Conservatives made in 2011, but that has still not been implemented, as I was saying earlier. It seems it will be in the next budget bill.

Given how quick the government is to impose its ideology and force the House to quickly accept tax measures with little or no debate, the reason income splitting has not yet taken effect is probably that the Conservatives themselves are beginning to doubt that it is appropriate and effective and the Conservative caucus is far from unanimous on this issue.

Let us remember that the former finance minister—whose memory is honoured by many Canadians—had serious concerns about this proposal and suggested that members not support it.

Let us now think about who would benefit from this so-called good idea I was talking about. It would definitely not benefit all Canadians since its implementation would cost the federal government $3 billion and the provinces nearly $2 billion.

For years we have seen this government's incredible ability to offload expenditures onto the provinces in an attempt to help balance the budget. Once again, this so-called good idea does nothing for Canadians and it will upset any balanced budgets on the provincial side of things. It is hard to imagine that that is a good idea.

The question is very simple. How will the Minister of Finance come up with an additional $3 billion? Will he take it from the employment insurance surplus or will he make more cuts to public services?

The question remains. We have already seen the damage this government's fiscal policy has caused. It would be quite sad to see the government make even more cuts to public services and misuse funds that have been earmarked for other purposes.

Who will benefit from this so-called good idea? Families, perhaps? Not even. Families with the greatest need are probably not the ones who will get the money. According to some reports, nearly 90% of families with children under 18 will not benefit significantly from income splitting. None of them. That is basically what that is saying. It means that this measure, while flashy and impressive, is missing the mark. It is counterproductive to make a law or policy that misses the mark, especially a fiscal one. A 2011 report by the C.D. Howe Institute, which is not known for being particularly leftist, made the exact same observations.

Could this measure help or benefit women? We in the NDP often analyze a legal or a budget provision through that prism, the prism of gender equality. With this income splitting measure, will women be able to move closer to pay equality? Well, no, it does not seem that the measure has hit the jackpot in that category either. Income splitting will also have undesirable consequences by discouraging women from entering, returning to, or even remaining in the labour force. The Conservatives' proposal will result in a major increase in the effective marginal tax rate for the spouse generating the lower income.

The measure therefore will not benefit women and it will not benefit Canadians. We wonder whether perhaps it will benefit the regions. We recall the Conservatives' wonderful slogan, “Our region in power”. Do we have a measure that meets the needs of the regions? No, we do not. Mission unaccomplished, yet again.

The ink is hardly dry on a report from the Broadbent Institute that sheds some very interesting light on the matter. I would describe that light as having more to do with partisan politics than with the economy and taxes. The report points out that this proposed measure would do much less for some provinces and somewhat less for others. I will let my colleagues guess the picture it paints, but for the benefit of those who are watching, I will say that among families with children under 18 years of age at home—the Conservatives' main target group, by the way—those living in Alberta would benefit most from income splitting. What a coincidence. They would save an average of $1,359 in taxes, while those in Saskatchewan would save about $1,070. As we all know full well, there are 42 federal constituencies in those two provinces and they elected 40 Conservative members in 2011. Again, just a coincidence.

In the face of the Conservatives' so-called good ideas about taxes, the proper instinct is always to ask who benefits. As it turns out, it is Conservative Party voters once again. At the other end of the scale, families in Prince Edward Island and Quebec will save very little, if anything at all. In those provinces, as we know, nary a Conservative is to be seen.

We have a government that was elected with a minority of 39% of the votes and puts forward ideas for another minority of the population. We really are light years away from a government that governs for all Canadians.

Who will benefit from this measure? The only answer, which I do not have the time to expand upon, is families that are already rich and do not need this incentive.

To conclude, this measure is a so-called good idea from the Conservatives, as I said, and we hope that it will be quickly abandoned. It is unfair, in the truest sense of the word, because it increases the inequalities between Canadians. It would not be the first time, because the policies of Conservative and Liberal governments have already helped increase income inequality. In fact, in the past 35 years, 94% of the increase in income inequality occurred under Liberal and Conservative governments. Please, let us not add to it.

In addition, there have been billions of dollars in Liberal and Conservative cuts to social transfers, which have made things worse by reducing low-income Canadians' access to social programs.

Instead of this so-called good idea, the NDP is proposing thoughtful solutions to give Canadian families a break. In 2015, Canadians across the country will have the choice to vote for a government that offers them a vision where no one is left behind.

[Gary Goodyear, Conservative, Minister of State (Federal Economic Development Agency for Southern Ontario)]

Mr. Speaker, some Canadians actually call surpluses that a government has “overtaxation”. I am not sure there is a difference. However, we have said that, once we reach balance and start looking at possible surpluses, we will look for ways to give that money back to the very folks it belongs to. This is just another of some of the 181 ways, I guess we could say, that the Conservative government has found to reduce the tax burden on seniors, farmers, students, single parents, couples, and the list goes on.

My question for the member is this. Of the 181 times we have recommended lowering taxes to one sector or another—in this case income splitting for couples—could he name just one that his New Democratic Party supported for lowering taxes on Canadians? I would be happy with one.

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Speaker, it is music to my ears to hear my colleague opposite say that once the budget is balanced, they will give the money back to the people it belongs to. Am I to understand that the Conservative government is finally telling us that it will stop dipping into the employment insurance fund to reduce its deficit and pay for the initiatives it wants to put forward and, as of next year, the employment insurance contributions of employers and workers will be used for workers who have lost their job and those people they are directly intended for?