Mr. Speaker, in my time today, let me reassure all hon. members that our government remains focused on the economy and the next budget.
As our finance minister recently said:
Given the current market instability, I will not bring forward our budget earlier than April. We need all the information we can obtain before finalizing our decisions.
If the members opposite can practise some patience, we will certainly provide them with our vision for the future in due course.
However, let me start by describing where we are and how we got here. Canada was able to weather the recent recession relatively well, but that recession's impact is still weighing heavily on the global economy. After the most severe global recession since the Great Depression has come the weakest global recovery. In the eurozone, the recovery remains elusive and inflation has fallen significantly, reaching -0.2% last December. The continent's three largest economies, Germany, France and Italy, all saw their economies contract in the second quarter of 2014 and have remained weak in the third quarter as well.
Just last week the European Central Bank significantly expanded its bond-buying program or quantitative easing, which it is estimated will now reach $1.1 trillion euros, plus possible extensions in an attempt to resuscitate a struggling eurozone economy.
Beyond Europe, the growth rates of key emerging economies, China and Brazil, are slowing as well. Geopolitical conflicts in Ukraine, Iraq, and Syria have complicated the economic recovery and fuel global uncertainty.
However, after a weak start last year, the outlook for our American neighbours has strengthened considerably and bodes well for Canada. Still, the International Monetary Fund warns that economic risks remain elevated. The global economy is still very fragile and we are not immune from global shocks. We have been saying this for years and it remains valid today, perhaps more so than ever.
Many countries face difficult decisions ahead, yet in these challenging global times Canada has fared much better than most. A downturn that did not originate here hit us later than most and affected us less. Moreover, we emerged from the downturn more quickly and in better shape than other developed economies.
How, one might ask? With a prudent and long-term plan for economic growth and job creation, Canada has recovered all of the jobs lost during the great recession and more. In fact, over 1.2 million net new jobs have been created since the depths of the recession, jobs that are overwhelmingly full-time, high-paying, private sector jobs.
Since taking office in 2006, we have been carefully crafting a more confident Canada. That confidence is shown in the fact that Canadians are wealthier. A recent New York Times analysis found that after-tax middle-class incomes in Canada are higher than those in the United States. That is the first time that has happened. In fact, the Canadian middle class is among the richest in the developed world. The median net worth of Canadian families has increased by 45% since we took office and our government has been committed to taking less of that hard-earned money away with the lowest federal tax burden in over 50 years.
We have also put an emphasis on free trade, which is tremendously valuable and important to the state of the Canadian economy. When our government took office in 2006, Canada had free trade agreements with only five countries. We now have free trade deals with 43 countries, a network that touches every corner of the globe.
Let me be clear: we are not in a crisis. In fact, Canada has performed better than other G7 economies over the recovery. Both the IMF and OECD are still expecting Canada to be among the strongest economies in the G7 in 2014-15.
As the Prime Minister has repeatedly said, we have a choice: act to create jobs, growth, and resilience in a competitive global economy or risk long-term economic decline. As has been evident since our government came to power, we have been choosing long-term prosperity and are achieving results through our low-tax plan for jobs and growth.
At the end of the day, the Canadian families I have talked to are concerned about jobs and economic growth, and rightfully so. However, our economic action plan is working and we are doing that by keeping taxes low.
The Liberals and the NDP would both institute high-tax and high-debt agendas, which would be devastating for the economy, killing jobs, and undermining all the work we have done so far.
Our government's plan does not include raising taxes or slashing transfers to the provinces like our predecessors did. To the contrary, we have cut taxes 180 times and have increased transfer payments by 55% since 2006, reaching $65 billion this year, the highest ever. These transfers are used for key priorities, such as health care and post-secondary education. We remain committed to keeping taxes down and increasing transfers as the economy grows. We controlled government spending, something that few nations have done in decades, and we have done it while maintaining the programs and services Canadians rely upon. Contrast that to the opposition, which would drive the economy into deeper deficits with bureaucratic and inefficient spending schemes.
With this plan, we have been able to provide even more direct support for hard-working Canadians families. The opposition will tell us today that it should be trusted to help the middle class, that it knows what is best for Canadian families. Our government's track record speaks for itself. We have always been committed to putting more money back into the pockets of hard-working Canadian families. Our new family tax cut would benefit 100% of families with children under the age of 18, at a time when the cost of raising a family is at an all-time high. This alone would work out to an average of over $1,100 per year for families to spend on their own priorities.
We will not apologize for building on our record of historic tax relief for Canadians. It is our Conservative government that increased the amount Canadians can earn tax-free. We introduced the tax-free savings account, the most popular savings vehicle since RRSPs. We introduced pension income splitting for seniors. Combined, these measures are saving Canadian families, on average, over $3,400 per year.
What would all this mean for over four million Canadian families with kids? Every one of them would benefit. Take for example, a two-earner couple with children aged seven and three. One spouse earns $95,000, and the other earns $25,000. For the 2015 tax year alone, such a family would be better off by $2,835. Or take a single mom earning $30,000, with a four-year-old and an eight-year old. She would receive $1,224 in additional benefits this year alone.
Here is an important point that I am proud of, namely that two-thirds of these benefits would go to low- and middle-income Canadians, with 25% going to families earning less than $30,000. We are providing families this financial relief for a simple reason. Across Canada, Canadians are telling us the same thing, that costs are going up. It is our government that understands that for a more affordable life, Canadians need a more affordable tax burden.
The fact is, according to a Fraser Institute report released last August, Canadians are paying, on average, about 42% of their income in taxes to all levels of government, which is more than on food, clothing, and lodging combined. On this side of the House, we just do not believe that government needs more of that money.
However, we know what the opposition would do. It would take these benefits away, cancelling the tax breaks and increasing taxes on those very same people. It said it would do precisely that. Everything we have learned from the post-recession history proves that the opposition's policies would be damaging to the Canadian economy and hurt the very people the NDP and the Liberals claim to stand up for, which brings us back to the economy.
One thing I can tell the opposition today is that we will be presenting a balanced budget to Canadians. We promised Canadians that we would return to a balanced budget, because it is important for Canadians and our economy. It would mean that more funding would be available for important programs that Canadians need, and it would keep the debt burden low. This is another way that our government would be protecting Canada from international shocks.
While the opposition ignores these basic economic principles, our government will keep our promises and commitments to the Canadian people.
In the worst of the recession, Canada's deficit stood at over $55 billion. Today, it has been reduced by over 90%, to just over $5 billion, and it is still falling.
Yes, crude oil prices have fallen since last year, and this will impact our government's flexibility. However, we have noted that lower oil prices do have benefits for consumers at the pumps, for example, and they also mean lower energy prices for the manufacturing sector. Despite this volatile market, our government is confident that the fluctuation in oil prices will not stop our government from achieving a budgetary balance in 2015. This is truly a remarkable achievement when so many other countries are still locked in deep deficits.
It is not easy to return to a balanced budget. Contrary to what some may believe, budgets do not balance themselves. Balancing a budget requires a plan and the discipline to follow that plan. It is why the Minister of Finance has said that we are using the next months to hear from Canadians, hear from private sector economists, and gather all the information to make an informed decision. Given the current market instability, we will do everything necessary before we finalize our decisions.
With all of the pessimism and negativity emanating from the opposition, it may be hard for some people to get a good grasp of the real economic situation we are faced with today. Let me assure Canadians that now is not the time to be pessimistic. Canada has a diverse economy and is not solely driven by the oil sector. Federal revenues are equally diverse; Canada has a highly diverse economy. That is why our government supports jobs and growth by connecting Canadians with available jobs; fostering job creation, innovation, and trade; and providing record investments in manufacturing, infrastructure, and transportation.
However, if the opposition members had their way, they would institute higher taxes and put us back into deficit just as we are recovering from the global recession. We must remember that these tax hikes would have a destructive effect on all sectors of the economy. They would be an unnecessary job killer and would take money away from Canadians that would be better reinvested in the economy. Both the Liberals' and the New Democrats' reckless commitment to raising taxes and spending beyond our means is not an economic plan, and Canadians expect and deserve better.
We simply cannot afford to return to a mindset that assumes governments can tax and spend as they please without economic consequences. We know what has happened in other countries where governments thought that way. We understand these basic truths: no government can tax its way to prosperity, and no government can indefinitely spend more than it takes in.
We cannot take prosperity for granted. Higher debt today means higher taxes and service cuts for our children and our grandchildren down the road. We have a duty to manage our finances responsibly. That is why we will get back to balance and stay there, all the while keeping our promise to provide continuous tax relief to Canadians.
Our government is well on its way to achieving our goal of reducing the federal debt to 25% of GDP by 2021. Indeed, the ratio is expected to fall below its pre-recession level by 2017. The IMF projects that our total government net debt-to-GDP ratio will remain the lowest of any G7 country. In fact, it is about half of the average.
As members can see, our government is delivering, and we are providing the leadership that is required during these challenging times. Now is not the time for risky experiments or a flighty trip back to discarded ideas and failed policies of the past. Canada has come a long way, but we are not in the clear yet. Our government has a plan to meet these challenges, a plan that is working, and we must stay the course. We survived the great recession; now we will take the action necessary to secure prosperity for this generation and the next.
To conclude, Canada is on the right track. Canadians are aware of the benefits our government is providing, and we will soon present our vision for the future in economic action plan 2015.