Debates of Feb. 5th, 2015

Opposition Motion—Job Creation

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I would like to pose a follow-up question from question period to see if the member can provide some further information on why the government has made this rather bizarre decision to cut back on infrastructure dollars when they are needed.

I am sure the member would recognize that when one invests in infrastructure, roads and so forth, one is indirectly and often directly supporting small businesses. That is healthy for the economy and enhances the middle class, and so forth.

The question I have for the member is fairly specific. Last year the government spent $2 billion on infrastructure and this year it is spending $210 million. Can she explain to viewers and the House why the Conservative government has cut 90% of the infrastructure spending of last year? Why has there been a 90% cut this year?

[The Acting Speaker, Conservative, Bruce Stanton]

I appreciate the question by the hon. member for Winnipeg North. Although he made a reference to small business, he will know that adjournment proceedings is the time when members have the opportunity to address questions that have arisen during question period and perhaps get into a more thorough response.

I see the hon. member for Renfrew—Nipissing—Pembroke standing, so perhaps she would like to entertain the question, even though I know she did not really touch on infrastructure per se in her remarks.

The hon. member for Renfrew—Nipissing—Pembroke.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Mr. Speaker, these are the facts. Lowering the federal income tax rate to 15% is what the federal government has done for corporate income tax. The Liberals and the NDP voted against it. We extended the accelerated capital cost allowance for new investment in machinery and equipment already. The Liberals and NDP voted against it. We created the automotive innovation fund and the Liberals and NDP voted against it. We established the national shipbuilding procurement strategy and the NDP and the Liberals voted against it. The advanced manufacturing fund the Liberals and NDP voted against. The Federal Economic Development Agency for Southern Ontario the Liberals and NDP voted against. The Canada job grant the Liberals and NDP voted against. The Canada apprenticeship loan the Liberals and NDP voted against.

As we can see, everything the Liberals have talked about is hollow. When it comes to creating an environment that is conducive to more jobs and more companies coming into Canada, they vote against it each and every time.

[Michelle Rempel, Conservative, Minister of State (Western Economic Diversification)]

Mr. Speaker, the motion before the House, as I read it, is that the government can take action to create a balanced economy, support the middle class, and encourage manufacturing and small business job creation.

In my opinion, to do that we have to look at our country's ability to be financially stable, with a strong social safety net, including a fiscal house that is in order, because a lot of the dialogue on the economic downturn in 2008 concerned the debt ratios of governments in certain countries.

We can look at our government's track record on this, and I wish I had an hour to talk about it, when it comes to that balanced economy component.

First, when we came into office between 2006 and 2008, we aggressively paid down our government's debt in our desire to have a balanced budget and to ensure that we do had a strong fiscal house that was in order. When the economic downturn hit in 2008, we took measures to bolster consumer confidence and job creation through targeted infrastructure spending, like the knowledge infrastructure program and community infrastructure improvement program. These were designed to create jobs, but also in a way that we could move back toward fiscal balance once we were out of the economic downturn.

We were also trying to ensure that the situation was right for job creation, and so we increased our trade agreements. When we came into office, I believe were six trade agreements in place. We now have over 40.

We also invested $50 billion in infrastructure through the building Canada plan, which is one of the largest infrastructure funding programs in Canadian history.

We also looked at ways to ensure that we have a strong, skilled labour pool, which I could speak to in detail, and a healthy and educated population, which is why we have increased transfer payments to the provinces. We have ensured a stable source of funding for both health care and education so that our provincial partners can plan for those investments well into the future.

Two other things are important. We have also made sure that we lowered the tax rate on job creating companies. Why have we done that? It is because, all else considered equal, tax rates are certainly a determinant to whether or not we attract foreign investment into the country.

We have also looked at ways to reduce our red tape burden, which I will speak to in a moment, but most important, we have undergone a strategic review in government.

Through all of these other economic actions I just talked about it, we have increased revenues for the government while ensuring that we are taking good care of our fiduciary responsibility to manage taxpayer dollars wisely. We have have made sure that we are on track to balance our budget, which we will continue to do this fiscal year.

All in all, with this economic plan that we have put in place, the ground is fertile for Canada's continued long-term economic success. That is the macro picture of our balanced economy. The conditions are right for job creation and entrepreneurship, et cetera, in Canada after and years of our government's strong, stable, steadfast focus on smart and predictable economic policy.

In terms of support for the middle class, the tax burden in Canada is at its lowest level in 50 years. When we look at the tax relief and benefits that an average two-earner family of four will accrue, historically since 2006, and with our new measures, there will be an additional $6,600 in the pockets of Canadian families per year.

That is not insubstantial. It means a lot to Canadian families. Ensuring that Canadian families have choice in how they can spend their money, with more income flexibility, that tax reduction means a lot to Canadian.

Through our economic action plan, we have one of the best job creation records in the G7, with more jobs available for Canadians and their families, which addresses the middle class piece of the motion.

As the Minister of State for Western Economic Diversification, I want to speak a little bit about my portfolio. I do not think the debate is about our being unable to support the energy sector and have a stable Canadian economy at the same time. It is about the fact we have some very strong primary industries in Canada. Certainly in western Canada, the energy sector is part of that, as are agriculture and forestry, but the strength of those primary industries can be used to create receptor capacity for emerging secondary industries.

Whenever I address a chamber of commerce in western Canada, I always talk about the fact that in my position I want Canadians to see western Canada as more than hewers of wood and drawers of water. While those industries create hundreds of thousands of jobs and will continue to be important for the economy, there are stories to be told about the emergence of digital media clusters, of biomedical technology, the pharmaceutical sector, of the burgeoning field of clean energy technology, of our aerospace sector in western Canada. It has been through our government's targeted measures to support these areas, many of which are small businesses, that we have seen them start to grow and thrive.

With regard to small business support in general, I want to explain our tax rate policy for job-creating companies. I will first quote my colleague from Hamilton Mountain, whom I have great respect for, from debate in February 2011. She is a very talented parliamentarian, but I do disagree with her on this point. She rose in debate on a Liberal motion and said:

I am delighted to rise in the House to speak to the Liberal motion calling on the government not to proceed with further corporate tax cuts and to restore the tax rate for large corporations to 2010 levels in the upcoming budget.

She continued to talk about why we should not be lowering tax rates on job-creating companies.

A lower taxation rate gives companies the ability to be more liquid and to have more choices, and it also attracts foreign direct investment. That is why we have reduced the corporate tax rate to very competitive levels internationally. On the small business side, we lowered the threshold on tax rates for small and medium-size enterprises to $500,000, so that more businesses would be classified at that particular rate. Again, we reduced the rate and I believe my colleagues opposite voted against those motions. So I find it somewhat rich that they are putting this forward today, because it has been our government that has consistently put forward both in its messaging and tangible policy our commitments to small business.

Small business can be supported in many ways above and beyond these tax breaks that we have already done. Indeed, through Western Economic Diversification we have a wide variety of measures to support small businesses. For instance, we support the Western Canada Business Service Network, which includes organizations such as Alberta Women Entrepreneurs, a great organization. We have the Community Futures Alberta organization, which provides small business loans to small businesses in rural communities to see economic diversification.

We have also invested across the R and D life cycle for innovation. To say that we do not have an innovation tax credit is simply ridiculous, because we have the SR and ED tax program.

My concern about the NDP's motion is that there is absolutely no detail on what this would be spent on. New Democrats have not tried to define innovative activities, what areas they would focus on. I believe that through the Jenkins report and the things we we have done, we have done a very good job to support basic research. We have supported commercialization activities as well as tax credits for innovation-happening companies.

In my department, we have the western innovation initiative, which is a new program with $100 million over five years targeted at providing support for small businesses that are looking at prototype development, process, scale-up, and these sorts of things. This has been an awesome program. We have seen huge subscription rates for it. Again, in the area of the R and D life cycle, we could talk about every step of the way that our government has supported, including our venture capital action plan.

I want to close with something my colleague was alluding to. When looking at corporate tax rates, we cannot just look at tax cuts. We also have to look at other tax rates. My concern is that the NDP has never come out and said that it would not impose a carbon tax on Canadian businesses. I know there is usually a giggle on the other side when this is brought up, but a carbon tax would in fact raise input costs like electricity, like consumable goods and manufacturing, which I do not think my colleagues opposite have adequately modelled.

Frankly, if I had a small business, I would be concerned about the inability of the NDP to put forward a predictable and stable plan when it comes to taxation rates. This is what our government has done. We have said, “here is what we are going to do to help you”, and we have followed through.

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

Mr. Speaker, I thank the hon. minister of state for her speech that dealt more with the topic of debate today than the speech by her Ontario colleague, who got off track talking about the difficulties Ontario consumers faced after Ontario Hydro was dismantled by the ultra-Conserative Mike Harris government. I should point out that a number ministers in the current federal cabinet were sitting at the time to misrepresent that disaster.

That said, I want to get back to the topic at hand and refer my colleague to the Bank of Canada's Monetary Policy Report. This report indicates that the excess capacity of Canadian businesses remains relatively high, as does the long-term unemployment rate for workers aged 25 to 54. We can therefore conclude that Canadian companies lack trust in the future and are therefore not investing. There has been very little investment to improve productivity in recent years. That is a legacy of this government.

Does my colleague agree with the Bank of Canada that there is a problem and that our businesses are not truly prepared to deal with the changes they face as a result of the low price of oil and the value of the Canadian dollar?

[Michelle Rempel, Conservative, Calgary Centre-North, AB]

Mr. Speaker, there are so many things in that question, but I will focus on the ability of businesses in Canada to weather economic shock and to make investments.

Certainly the stability our government has put in place through legislation, like what we debated this week on the one-for-one regulatory rule, in which we are saying that we are going to have a stable regulatory environment, is a very positive signal to business. The CFIB certainly supports that approach. A reduced corporate tax rate and increased trade agreements, which allow access to bigger markets, certainly help support the confidence of small business.

With regard to productivity, I agree that productivity is a major focus area for Canadian business, especially when we are looking at labour as an input cost. Again, I would encourage my colleague to look at my department's website. We have invested heavily in productivity, especially for manufacturing initiatives such as ACAMP, through SAIT, and the Saskatchewan Trade and Export Partnership, and in our aerospace sector, through the West Canitest centre, as well. There are a lot of initiatives looking specifically at productivity in certain sectors of the economy.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I will take advantage of the fact that the member is the minister responsible for western diversification. There has been a great deal of concern over the last little while that the government's focus seems to be just on oil and the price of oil.

The resolution being proposed talks about having balance in the economy. The minister plays a very important role in western Canada. I would think that the minister would recognize the value of infrastructure dollars that would assist manufacturing companies and small businesses in getting their products to market and in being able to invest. Quite often, in certain areas of the province, one needs to spend infrastructure dollars.

Why does the member believe that the government has chosen to decrease infrastructure dollars from the one-time spending of $2 billion to $120 million?

[Michelle Rempel, Conservative, Calgary Centre-North, AB]

Mr. Speaker, I will try to bring that question to relevance to the debate at hand.

My colleague is talking about investment in infrastructure, I think related to productivity and manufacturing capability in western Canada in sectors that are not necessarily related to the energy sector. I will give some examples of recent funding.

There is $3.3 million for the purchase and installation of specialized equipment at the Alberta centre for advanced micro and nanotechnology products. It is an awesome centre. This is a shout-out to those guys. They are doing great work.

There is the West Canitest centre. I was out there, and I will be out there again this week. This is equipment that allows for testing of engines. I believe that we have put in $2.5 million recently, but millions of dollars.

There is the Canada Foundation for Innovation. This is infrastructure spending of hundreds of millions of dollars to support research and development infrastructure, which, again, will help diversify the economy by creating intellectual property here in Canada.

I think my colleague was slightly confused, but I hope I brought some clarity to his question.

[Nycole Turmel, NDP, Hull—Aylmer, QC]

Mr. Speaker, I will be sharing my time with the member for Skeena—Bulkley Valley.

I am very happy to make this presentation. We have spoken at length about the economy recently in this House. With the drop in the price of oil, Canadians are concerned about the economic health of our country, and with reason. The situation really shines a light on the Conservatives' mismanagement.

Because of a failure to invest in innovation and diversification, our economy is now vulnerable to shocks like this to natural resource prices. It is time for things to change, and Canadians should not have to wait until the next election for solutions.

In the NDP, we have a plan to repair the damage caused by the Conservatives. The motion moved by my colleague, the member for Parkdale—High Park, proposes three concrete steps the government can take today in order to boost our economy and support the middle class.

Our first suggestion is to stimulate job creation in small businesses by extending the accelerated capital cost allowance by two years. The second is to reduce the small business income tax rate from 11% to 10% immediately, and then to 9% when the economic situation permits. Finally, the third suggestion is to introduce an innovation tax credit to support investment in machinery, equipment and property in order to further innovation and increase productivity.

Clearly, our proposals focus on small and medium-sized enterprises, the real creators of employment in Canada, and they are very easy to implement. Between 2002 and 2012, in fact, 78% of new jobs in the private sector were created in SMEs. That is not surprising. Furthermore, 98% of all Canadian companies are SMEs: companies with fewer than 100 employees. They account for 40% of Canada’s GDP and employ nearly 8 million Canadians across this country.

However, the Conservative government does not seem to have gotten the message. It continues to pay no attention to SMEs. Since 2010, Canada has lost over 1,500 of them, mainly because of measures like the elimination of the small business hiring credit. Meanwhile, the Conservatives had ample resources to provide tens of billions of dollars in tax breaks to large companies. By constantly serving the interests of the Conservative Party and its friends, the government has lost sight of the interests of Canadians. They are out of touch with reality.

Personally, I have just completed a tour of the SMEs in my constituency. At ground level, it is very clear that the economic reality is difficult for SMEs. They constantly have to find new approaches and new ideas in order to remain profitable. I was truly impressed by the creativity and tenacity of the entrepreneurs I met with.

I am thinking, for example, of the Créagora initiative, a co-operative workspace in which a number of entrepreneurs work under the same roof. This space enables professionals to work independently, while sharing their resources and ideas. It is brilliant. I am also thinking of APICA, a group of business people and SMEs in the Aylmer sector who are constantly innovating and support numerous activities locally. Their contribution is not limited to creating jobs; they contribute their energy to our community. I congratulate them on what they are doing.

I should also say that one thing that came up often in my conversations with entrepreneurs is the fact that they often do not have the resources to offer full-time jobs to their employees. Part-time jobs can be useful, for example, by enabling students to balance working and going to school. However, people know as well as I do that you cannot live on a part-time job. As a result, in many cases, employees are just passing through such companies. It is truly difficult to build a succession in such circumstances.

Many entrepreneurs also tell me that government cuts have had a negative impact on the business climate in the Outaouais. That is not really a surprise. In the Outaouais, we know that the presence of the federal public service has a major impact on our economy.

That is one of the reasons why the NDP wants to make sure that at least 25% of investment in the national capital region takes place on the Quebec side of the river.

Since 2013, we have seen a clear deterioration in the job situation in our area. According to a study commissioned by the Gatineau chamber of commerce, the Outaouais lost 4,000 jobs in 2013, whereas the rest of Quebec posted an increase.

According to the study, job cuts in the federal public service are the direct cause of this poor performance. We can see that it is the entrepreneurs and families in my constituency who are paying the price for the ideological cuts made by this government. However, after shaking the economy of our area, the Conservatives have folded their arms and are refusing to support the entrepreneurs who are trying to diversify the economic structure of the Outaouais.

I was discussing this very subject this morning with Antoine Normand, who chairs the board of the Gatineau chamber of commerce. I must thank him for making himself available. It is always a pleasure to talk with him. He is always very open and helpful, which is very pleasant.

He was telling me that diversification should be a priority for sustainable economic development in the Outaouais. There is a huge potential for jobs in the Outaouais. The Canadian Federation of Independent Business ranks Gatineau among the most dynamic Canadian cities in terms of entrepreneurship.

We have the highest rate of bilingualism in Quebec and one of the highest graduation rates per capita. To put all this potential to work, it is time the three levels of government started working together to develop and fund a strategy to develop and attract businesses.

As Mr. Normand said, we have to support our businesses directly in terms of both research and development and facilitating imports. He proposed establishing a business mentoring program.

At present, there is not much mentoring of this kind in the Outaouais, for one thing because of the lack of leadership and resources from the federal government. He is nonetheless convinced that this kind of program could help businesses that are starting up to make it through their first five years of existence. Those first five years are a critical period, and we really have to help them get through that time to make sure they survive.

What the job creators in the Outaouais are asking for is not extravagant. They are not asking for business opportunities to be handed to them on a silver platter. These are people who are not afraid of hard work, and I can attest to that. In addition to meeting with SMEs, I come from a family that had a small business, and I saw my family work really very hard to help the employees and make sure that services were provided to the community and that at the end of the year they had saved some money and there was money to pay the taxes.

It is sad to see such extreme deterioration where we live in the Outaouais and see the government failing to meet the needs of small businesses to diversify the economy and make sure that someone can step in after the federal government’s budget cuts.

What these people really want is for the federal government to do its fair share to contribute to the economic development of our communities.

As I said, we in the NDP agree with them. We understand them and we support them. We believe that the government can take measures, starting today, to help SMEs do what they do best: create jobs. We have to support them in that effort.

I therefore urge my colleagues on both sides of the House to vote for this motion and start the work. This is a program that could be implemented very easily and very quickly.

[Philip Toone, NDP, Gaspésie—Îles-de-la-Madeleine, QC]

Mr. Speaker, I would like to thank my colleague from Hull—Aylmer for her speech, which made a lot of sense. She raised some very important points.

The federal government has shown its lack of support for Quebec time and time again. It withdrew funding from a number of industries. It took away employment insurance funding. It cut well-paying jobs in employment insurance processing centres in a number of regions. It made cuts to Canada Post, and so on. The government has made so many cuts that we need to find ways to revitalize the economies of our regions. Today's motion responds to that need.

According to the chamber of commerce, 4,000 jobs have been lost in Hull—Aylmer, in the Outaouais, where my colleague is from. The Conservative government has cut many public service jobs, which has hurt the region's economy.

Does my colleague know whether the Public Service Alliance of Canada has anything to say about the investment that the federal government should make in Hull—Aylmer and the Outaouais region? Does it want to work in partnership with the federal government? Is the Conservative government missing in action?

[Nycole Turmel, NDP, Hull—Aylmer, QC]

Mr. Speaker, I would like to thank my colleague for his question regarding the work that unions are doing to find solutions to regional economic problems.

There have been some meaningless meetings. As with everything else, this is how the Conservative government does things. What is more, the unions are in the midst of negotiations, and we know what the government thinks about negotiations.

From my personal experience as a former PSAC insider, and from what I am hearing about what is going on right now, I know that the unions are also trying to provide programs and services so that people are able to live a good life in the national capital region, especially since 4,000 jobs have been lost compared to other regions. That is very unfortunate.

If this government would listen, we could find solutions together and diversify the economy, whether it be in the national capital region or elsewhere. However, this government does not listen to us, so why would it listen to anyone else? Cuts should not be made just for the sake of making cuts. Cuts should be offset by other programs so that the regions are not affected.

[Paul Calandra, Conservative, Parliamentary Secretary to the Prime Minister and for Intergovernmental Affairs]

Mr. Speaker, it is clear that we are not going to agree on certain things, but I wonder if the member might comment a bit on this.

We know that the Liberals certainly do not agree with what the New Democrats are proposing, and have not in the past, and they currently do not agree with some of the measures we have brought in for the manufacturing sector. We also know that the leader of the Liberal Party has suggested it is time to transition away from manufacturing. I think he called it something like an old 20th century concept from which we should move away.

I wonder if the member might comment on that position of the Liberal Party, the fact that the Liberals do not support manufacturing and that they want to put millions of people out of work by somehow transitioning away from manufacturing.

[Nycole Turmel, NDP, Hull—Aylmer, QC]

Mr. Speaker, I would like to thank the member for his question and for his comment on the Liberal position on the manufacturing sector.

The manufacturing sector provides good jobs that are well paid, as well as good working conditions, but the past few years have been disastrous. After receiving subsidies from the Conservative Party, some plants closed down, which led to job losses, and left with the working tools.

With regard to the Liberal Party, my colleague is speaking to the right person, because I worked with the other parties for 20 years. In 1990, it was the Liberal Party that made job cuts and program cuts, took money out of employment insurance and the pension fund, and so on. I do not think it has changed much since then.

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

Mr. Speaker, I would like to thank my friend from Parkdale—High Park who has put forward this important motion, which I think addresses in part the context that the Canadian economy faces today.

We have seen from the sitting government a certain element of panic, perhaps confusion, with respect to how to respond to some of the key elemental and fundamental aspects of the Canadian economy and the weakening of the economy over the last number of months. We have seen the Minister of Finance unwilling and unable to answer questions in this place and unwilling and unable to present a budget until at least two months later than was originally planned.

We have seen confusion among the senior ministers about key aspects. Will the government need to bring forward another austerity budget in terms of cutting services to meet its agenda to balance the books? Will it need to raise revenues? Will it need to dip into its $3 billion rainy day fund, which is meant to cover natural disasters?

To all of those basic questions for the government, we have only seen confusion. We have had completely different answers, on the same day in some instances. We have seen a government that is scrambling, with no real plan B. We have seen an economy, due in some part to the government, that overrelied on certain sectors to the detriment of others.

The reason I can say that with some confidence is that the numbers from Statistics Canada hold this picture up for Canadians and, particularly, for the Conservative government to view.

There are 400,000 lost manufacturing jobs just since the Conservatives took power. In 2014, we saw the lowest job growth since 2009. Again, these are not disputed numbers. This is the reality going on in the Canadian economy. In 2014, which was supposed to be a spectacular year for the Canadian economy, according to some of my colleagues on the Conservative benches, the Canadian economy grew at half the rate of the Canadian population, in terms of job growth.

This should be a concern for anybody who is concerned with the economy. When the population is growing at nearly double the pace of the number of jobs that are being created, that is not a good trend.

We have seen persistently high youth unemployment, at nearly double the national average, and we now have 200,000 more Canadians out of work than before the recession started. Take a moment to think about that. We went into the recession with 1.1 million Canadians out of work, and we now have 1.3 million Canadians out of work after the recession and after the government has taken so much self-offered credit for the spectacular job it has done.

Those are the realities. The economy also shrank in November, which is a concern. These are all numbers from before the latest wave of job losses, particularly in the Canadian retail and energy sectors. There, we have seen not thousands but tens of thousands of Canadians losing their jobs. Our worry is that many of them are part time and do not qualify for employment insurance. That is just in the last number of weeks and months.

For any government to not be preoccupied is a concern, when we have six unemployed Canadians for every job opening in the Canadian economy right now. The Conservatives can spin where they want to, but the reality of those numbers comes from their own departments, and they come from Statistics Canada, and they are not to be disputed.

In light of that reality, as well as the plummeting oil prices sitting just a little north of $50 today and lost revenue to the government, we ask what the plan is. What is plan B? We have seen plan A. We have lost 400,000 manufacturing jobs, we have a high youth unemployment rate, and we have 200,000 more Canadians out of work. We have the lowest female participation in the workforce since 2002. Those are all indisputable facts. What is the government's response, other than to delay the budget?

In that vacuum of ideas and opportunities for Canadians, New Democrats focused in on two primary sectors. The first is the small business sector, which accounts for 80% of all new jobs created and is 40% of our GDP. We also focused in on the manufacturing sector for reasons that I have already outlined.

We have lost so many value-added jobs. In a country that is primarily basing its economy on natural resources, value-added jobs have been the cornerstone to build the middle class and the compact that the government has had with the corporations for the last 80 years. That is what built the middle class in Canada. To lose 400,000 manufacturing jobs just since taking office should be a priority for the government, but its record obviously shows that it is either not a priority or that whatever opportunities it has given have not worked.

Let us look at other planks that the NDP has laid down, steadily, fully costed and accounted for, like a $15 federal minimum wage and affordable child care for all Canadians at up to $15 a day.

We know from the TD Bank and private sector economists that a fully funded, affordable child care plan would have a dividend in return back to the economy.For every $1 put in by government, the government can see back as much as $1.70 to $2.40. Why? It is because productivity is increased and particularly women's ability to get back into the labour force if they so choose. Private sector employers tell us that this has been a concern for a long time. As I said earlier, Canada has the lowest female participation rate in our economy since 2002. That has been the trend. What do we do about the trend? We offer up ideas, and this is where I find such a challenge with my Conservative and Liberal colleagues today.

Happily, we have support from the Canadian manufacturing sector and the small business advocates in this country, who historically have not always been fans of New Democratic policy. Dan Kelly and the head of the Canadian Manufacturers and Exporters say that these initiatives put forward by the leader of the NDP just last week are good for the economy. We have been reading some of their quotes all day.

I find it confusing when my Conservative and Liberal friends get up and make speeches and try to denounce New Democrats for what we propose. They say they are going to vote against this effort to lower the small business tax rate and help the Canadian manufacturing sector. Both those proposals alone are supported by the people who know best, the Canadian Manufacturers and Exporters and the Canadian Federation of Independent Business. The Conservatives say they are going to vote against it, but for what reason? Do they not believe that lowering the small business tax rate one point would help, potentially two points if finances allowed? Do they not believe in lengthening out the ability of the manufacturing industry to write off heavy equipment at a time when it is most critical?

The minister can make a speech any time she wants. If she wants to make a speech and tell us why they are going to vote against this—because they have not done that all day today—then I welcome her to the debate.

It is important for us. At a time when the Canadian economy is growing at half the pace of our population, when 400,000 manufacturing jobs have been lost under the Conservatives watch, one would think the government would at least be a little preoccupied with that fact. When youth unemployment is twice the national average and has been persistently so, and 200,000 more Canadians are out of work than before the recession started, one would think the government would be interested in more than just talking points and spending $1 billion on self-promoting ads to tell people how spectacular it is. An ad does not help a family feed itself. An ad does not help people get back to work when they need a job.

The Conservatives just spent another $2 million promoting the oil sector. They spent $2 million in support of Chevron, Shell, and all the companies that had extraordinary profits, and yet they do nothing for the forestry sector, the manufacturing sector, or the clean energy sector, all groups that are looking to grow and need to grow and are on the rebound, in some cases. The Conservatives are going to buy ads for the oil lobby because it is so good at lobbying.

If the Conservatives do not want to believe me, then perhaps they will believe Jayson Myers, who is the president and CEO of Canadian Manufacturers and Exporters. He said that these tax credits for new product development and commercialization are key measures that support manufacturing success.

Dan Kelly, president and CEO of the Canadian Federation of Independent Business said that cutting the small tax rate by nearly 20% will provide a big boost to small business owners across the country and help them create jobs.

What part of that do Conservatives and Liberals not agree with? Is it simply because of the source? Is it because New Democrats are offering up these solutions that they will not vote for these things, that they will not help out the manufacturing sector, and that they will not help small business?

I was a small business owner before getting into politics. There are two things small businesses need. They need a competitive tax rate and they need customers. We have shrinking and slowing growth in the middle class sector; we have lost more than 400,000 manufacturing jobs; more than 200,000 more Canadians are unemployed than before the global crisis. My goodness, do they want to help out small businesses?

The Conservatives cut the corporate tax rate for the wealthiest corporations like banks and oil companies by 25% since coming into office. They cut it by 1% for small businesses that create 80% of all new jobs in Canada. We can see where their priorities are. They put all their eggs in one basket.

[An hon. member]

And credit card issues.

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

Yes, Mr. Speaker, volunteer credit card fees. That is excellent. Small businesses are always telling us that merchant fees from credit card companies not only hurt them as small businesses but they hurt their customers who have to pay these exorbitant interest rates.

These are things that small businesses are asking for. New Democrats have answered with this motion. For heaven's sake, just get on board. Just say yes. It is so easy. All the experts in the field who know what they are talking about say these are good ideas. It is just as easy as standing and voting for it.

I look forward to their support.

[Paul Calandra, Conservative, Parliamentary Secretary to the Prime Minister and for Intergovernmental Affairs]

Mr. Speaker, as I just mentioned in the previous question, I am not going to sit here and explain to the hon. member how many ways he was wrong. I appreciate the fact that he has actually brought something to the table, unlike our colleagues at the end.

However, I want to touch upon two things.

The previous speaker mentioned it, so I think it might be relevant. She talked about a raid on the EI fund by the previous governments. I wonder if the member could touch upon that briefly.

I also appreciate that the NDP is supportive of the fact that tax cuts create jobs.

I wonder if the hon. member could comment further, because I think it is fair to get a bit of an assessment on what the other opposition party here has brought to the table with respect to manufacturing. We know that two parties have brought something to the table. They might not agree on all elements of it, and in fact probably disagree on a lot of it, but I wonder if he might also, as the finance critic, give his assessment of the Liberal Party's agenda when it comes to manufacturing. As well, if he could expand on the EI comment made by the member for Gatineau, I would appreciate it.

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

Mr. Speaker, I was just checking the numbers with my colleagues.

When the Liberals were in power, they raided the unemployment insurance fund, which, as I would remind all people, does not belong to the government. It belongs to the workers and the employers who pay into EI. It is insurance. It is there for people who need it when they lose their jobs.

The Liberals did two things when in power. The short answer is they took about $50 billion out. They took $50 billion away from the workers and from the employers and used it for an assortment of things. Some of it may have ended up in the sponsorship scandal. It is very difficult to ascertain.

The Conservatives ratcheted that down. They only took about $7 billion of the EI fund and have since stopped, which is good. Seven billion dollars versus $50 billion is varying degrees of things.

In terms of the manufacturing sector, I wish the Minister of State for Western Economic Diversification could answer this question. We have heard from manufacturers that they want to be able to take those SR and ED grants for innovation, research, and development and apply them to capital expenditures. That is an important aspect of innovation.

Sometimes equipment is needed in order to do research and development. I know it is shocking, but the Conservatives took that option away from manufacturers, from those innovators and entrepreneurs, while we said that they should be allowed to apply it. That is one of the reasons the Canadian Manufacturers & Exporters Association is supporting us. It knows this is something that would lead to the next great technological breakthroughs. When government believes in science and believes in investing in that science, the investment leads to innovation and a more robust and productive economy.

[Paulina Ayala, NDP, Honoré-Mercier, QC]

Mr. Speaker, small and medium-sized enterprises are the pillars of the Canadian economy, and they are responsible for 80% of the jobs created over the past few decades.

What concerns me enormously is the unemployment rate for young people between the ages of 15 and 25 in Canada, which is almost 14%. This motion talks about immediately lowering the small business tax rate. However, on the other side of the House, they say that the NDP still wants to bring in new taxes. No, here we are talking about tax cuts. Why are we talking about tax cuts? In the past, grants were available for small businesses to hire young people. Those grants have been eliminated. The government also abolished an employment assistance plan and penalized SMEs.

I would appreciate it if my colleague could explain how the Conservatives can possibly oppose a lower tax rate. It seems to me that is one of their own proposals. Can my colleague explain this reaction on the other side of the House? We all want Canadians to have jobs. We all want our young people to have an opportunity to work because they are the ones who will be paying our pensions and the taxes that will keep the country going.

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

[Member spoke in Spanish.]

[Translation]

Mr. Speaker, that is a very interesting question. This is very important, particularly for young people, because the current unemployment rate for young people is a disaster. Its effects may not necessarily be felt just today. It may hurt the entire career of someone who has the ability to do something else.

I was a young entrepreneur. In my case, it was sometimes difficult to obtain a little bit of attention from the government and other companies. It is because we think that small businesses are not very important, even though it is in small businesses that we find young people who are creative and innovative. If we can help young Canadians to find new jobs and create new businesses, this is something that can continue on for a generation or two. This is the kind of mindset that can be encouraged with a plan like this one.

[The Acting Speaker, Conservative, Bruce Stanton]

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 Drummond, Natural Resources; the hon. member for York South—Weston, Rail Transportation.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I have a number of thoughts that I would like to share with the House with respect to the motion the NDP has brought forward for debate today.

I will first respond to a couple of comments. The New Democrats like to talk about the employment insurance program. In previous speeches, NDP MPs have said that we should reflect on provincial NDP governments and some of the wonderful things that they do. I would suggest to the NDP finance critic that he might want to reflect on the resources that were withheld and taken away from injured workers in the province of Manitoba through workers' compensation. That is something for which the NDP is ultimately responsible. We are talking about injured workers.

During the 1990s, the recommendation from the national auditor general at the time was to deal with the employment insurance program, and lo and behold, the Liberal Party in government followed those recommendations.

Day after day, there are other comments and messages from the Conservative Party that hit home to a certain degree. The Parliamentary Secretary to the Prime Minister is very good at giving out this misinformation. We saw examples in the questions that he put forward.

I can appreciate why. The Liberal Party leader has asked us, as members of Parliament, to go out and connect with Canadians wherever we can to get a better understanding and to be able to bring forward ideas and solutions so that we will be ready for the next election. Part of that was an outreach in which our caucus went to London, Ontario. It is an area of the country that we feel passionate about. We are very much concerned about the number of jobs that have been lost in that region. Never before, under any other administration, have we seen so many manufacturing jobs disappear.

The Parliamentary Secretary to the Prime Minister needs to recognize that it is his government that has stood by and allowed tens of thousands, going into hundreds of thousands, of jobs in our manufacturing industry to disappear.

When Liberals and the Liberal leader go out and meet and connect with Canadians, what we hear is that Canadians as a whole believe in diversification. Liberals believe as well in manufacturing jobs. The Liberal Party has a record in government of creating manufacturing jobs, unlike the current government, which has lost hundreds of thousands of jobs.

When I was first elected back in a by-election, one of the first issues I raised had to do with aerospace jobs with Air Canada. I tried to get the current Prime Minister and his office to recognize that Air Canada had a legal obligation to protect aerospace jobs in Winnipeg, but the Prime Minister and his ministers did absolutely nothing, zero, to protect those jobs.

They were valuable jobs that led to manufacturing jobs. Those jobs were important to my province. That was not the case only in Manitoba; there were jobs in Ontario and Quebec that were also affected by the actions that were being taken by Air Canada. Because there was legislation to protect those jobs, we thought that some of the backbenchers and perhaps even some of the ministers would have taken an interest in the jobs being impacted in Quebec, Ontario, and Manitoba, and to a certain degree in B.C., and defend them. However, we heard nothing. We did not hear anything from the Prime Minister as he watched those jobs disappear. There was legislation to protect those specific jobs, and the Conservatives did nothing.

Should I be surprised that the national government chose to do nothing in a tangible way to deal with the severe loss of manufacturing jobs here, in particular in the province of Ontario, and other regions of the country also?

I am not surprised, but I am disappointed, and I believe Canadians are disappointed. They will get the opportunity to express their disappointment, not only to the members of Liberal caucus when we do our outreach to communities like London, Guelph and others, but when an election eventually comes around, some time in 2015.

When the Parliamentary Secretary to the Prime Minister talks about how the leader of the Liberal Party does not support the manufacturing industry, it is not true. He needs to look in the collective mirror of the Conservative government and see the tens of thousands of manufacturing jobs that the government is ultimately responsible for losing. That is quite the opposite of what we saw with the Liberal government.

The facts are very clear. I know the government does not like facts, but in 1993 the unemployment rate was 14%. That is what former prime minister Jean Chrétien and the Liberal government inherited when they came to the government benches. I remember Kim Campbell talking about double digit unemployment numbers for a long time. I was a provincial legislator at the time. The Liberal Party at that time said that it was not acceptable, that we would have to work hard for Canadians and get that number down. In 2006, Mr. Chrétien was very successful at cleaning up the Conservative mess.

We brought down that 14% unemployment rate to 6.5%. We handed that over to the governing Conservative Party in 2006.

When we think about the balanced economy, what else did the Liberals hand over to the Conservatives? We also handed over a trade surplus and a budget surplus. That was not the first time. Liberal governments under Chrétien and Martin provided a lot of budget surpluses. The Conservative government does not even know how to provide a budget on time, let alone a surplus, which it has been unsuccessful at accomplishing.

There is a great deal of room for improvement with the government. Thank goodness Canadians will have the opportunity to reflect on the incompetence of the government and its inability to get the job done.

This motion refers to a balanced economy and support for the middle class. I made reference to it earlier. A couple of years ago, the member for Papineau became the leader of the Liberal Party. He focused instantly on the importance of the middle class. That was the issue, and he wanted our caucus to give it more attention. From his perspective, it was important. We needed to start working for the middle class because a huge hole needed to be filled. It was not being debated. We were not working hard enough for the middle class.

When I say “we” I am referring to the Conservatives and the New Democrats as well. If we were to do a search of Hansard, we would find how many times the Prime Minister and the Leader of the Opposition made reference to the middle class. If we look at it today, whether it is the Prime Minister, or the minions of the Conservatives who come with their speaking notes direct from the PMO, they all make reference to the middle class. The New Democratic motion does as well, and that is okay.

In third party status, the leader of the Liberal Party was able to elevate the needs of the middle class to number one. That is something of which I am personally very proud. I look at it as a significant accomplishment, coming from a third party in the chamber.

However, I believe the middle class drives our economy. The more we recognize the importance of the middle class, the healthier our economy will be. It is the consumers who make the purchases that ultimately make up for well over 50% of all economic activity. The healthier our middle class is, the better we are in a position to move forward in a stronger and healthier way, so that all regions in our wonderful country are able to expand. That is what is important.

I was surprised when the New Democrats twisted on a dime. Now they want to appear as if they actually understand small businesses. At the best of times, it can be a challenge. I will give them that. They need to recognize that they have made a serious mistake in one of their major platform issues, and they need to revisit that. I am referring to the small business income tax rebate. They want to reduce the small business tax, believing it will create more jobs and somehow level the playing field. I can understand why the New Democrats might be suspicious of me saying this. However, it is not just me saying it. I would like to provide some quotes for the New Democrats.

I have made reference to Jack Mintz. However, a number of economists are saying the same thing. The Centre for Policy Alternatives recognizes the deficiency of this proposal. I have some specific quotes. This is a direct reflection on what the New Democrats will vote for, and they need to be reminded of this. They might want to make an amendment, maybe even a friendly amendment, to their own motion.

Jack Mintz has done a considerable amount of work on the issue. He is the director of the University of Calgary School of Public Policy. There is an article in the Huffington Post, which members can read. A bit down in the article it says, “But Mintz and some fellow economists argue that the tax break will go overwhelmingly to Canadians who need it least and may not result in job growth at all”.

I almost wanted to start talking about the Conservatives' income splitting and their $2 billion tax break to the richest, when I first read that comment.

However, the article continues:

We find that 60 per cent of the small business deduction goes to households with more than $150,000 in income,” Mintz said, of research he has previously done on the subject. “That’s because you tend to have a relatively high number of high-income households who own small businesses...

The worst part [of the NDP plan]...is that it doesn’t have good economic impacts because small business deductions contribute to a wall of taxation, so if they grow, they lose some of their benefits and get hit with higher taxes…It tends to keep small businesses smaller.

The small business tax rate, which is really the taxation rate for a Canadian-controlled private corporation (known as CCPC), is also used by high-income households as a form of income splitting with dividend distributions shared between spouse...

When the reporter brought this to the attention of the NDP critic for finance, what did he say? This is the NDP critic:

When asked about the CCPC loophole, NDP finance critic...told HuffPost the NDP has fought against tax havens and closing up loopholes, and supported tax relief tied to job creation. But [the critic] acknowledged that the NDP plan announced Tuesday doesn’t tie any strings to the tax break. No jobs have to be created to take advantage of the lower tax rate.

The New Democrats need to read what their House leadership has provided to them. That is what they are being asked to vote in favour of. Before they say that Mintz is some right-wing individual, I am sure they are aware of the Centre for Policy Alternatives. The Centre for Policy Alternatives, Armine, reflected on Mr. Mintz' comments. On the CBC network, she said, “It's a little bit weird to say that we are looking at a way of benefiting small businesses when small businesses can also be tax shelters. If you want to do the things that they are saying, you could actually target your tax cut to incentivize the growth, or only give tax cuts when the behaviour you're looking for takes place, not just this broad-based thing”.

Let us reflect on this for a moment. The New Democrats will still be voting for that component in their opposition day motion. They had a chance to vote for a program that would have provided incentives for small and middle-sized businesses to hire additional employees. Outside groups, non-politicians, said that it was a wonderful idea. They said that it would generate tens of thousands of jobs in every region of the country. This was a proposal put forward by the leader of the Liberal Party late last fall, recommending an EI exemption for new hires. It would have provided the incentive for small businesses to hire people.

That is how we support the Canadian economy, not some pie in the sky, that we will now try to appease small business, this is what we will do, and not have thought it through. It appears that the NDP has done that. The New Democrats have to think through other policies that they talk about.

Canada is a trading nation. We are very dependant on trade. We need trade, yet the NDP is still the only political party inside the chamber that does not understand this, to the degree in which it continuously votes against trade agreements, even the EU agreement. When there was a motion before the House, the NDP members took the opportunity to vote against that. They do not recognize how small and medium-sized businesses benefit by exportation.

Small and medium-sized businesses need that exportation. It creates the type of jobs that Canadians want us to develop and promote. These are the types of policies that make a difference. If we want to improve the quality of life for the middle class, we have to look at initiatives that will make a difference in a very real and tangible way, because it is about priorities.

We will have the budget in a couple of months. We hope the Conservatives will have reversed their decision about the $2 billion commitment on income splitting, because there is so much more we can do to assist our middle class, as opposed to giving hundreds of millions of dollars to some of Canada's wealthiest people.

It is about priorities. If we want balance, if we want the economy to grow, and we want to enrich the middle class, we have to make sure that we think through our decisions and make good, solid decisions. I am going to suggest that the motion the NDP brought forward today has not been thought through. It has done a poor job. New Democrats might want to reflect on what their leader is asking them to vote for.

[Peter Kent, Conservative, Thornhill, ON]

Mr. Speaker, I would agree with my colleague's concluding comments on the NDP motion being considerably less than well thought through.

I would also agree in general terms with my friend, as I have heard from various speakers across the aisle today, that small and medium-sized businesses are the driving energy behind our economy. I would again remind all of my friends across the way that Bloomberg, the business and financial agency, recently conducted a significantly well-researched global poll and found that Canada is, in fact, among the top-ranking countries when it comes to a favourable climate for startups and the growth of small to medium-sized to major-sized businesses.

My question has more to do with my friend's comments about timely elections. I would remind him that in the 1990s, the Chrétien government, of which he spoke so glowingly, once went almost two years between budgets. In fact, an individual here in Ottawa, whom my friend and others on the opposition side have been fond of quoting recently, the former parliamentary budget officer, has said that the finance minister has been quite prudent in waiting for some of the dust to settle in the current economic uncertainty and that, in fact, no great damage will be done to the economy by having a bit of space before the budget, only a few days later this year than often in the past.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I do not know what he is specifically referring to with regard to Mr. Chrétien back then. I was not in the House at the time, so I cannot really comment on that.

What I know is that there was an expectation and a sense of a commitment provided by the government that the budget date would be known by now and that it would possibly even be presented in February. That was fairly widely accepted. It was quite surprising that at a time when we wanted to have confidence in the economy, when oil prices started to drop so rapidly, the only excuse the government was able to come up with was that because of the dropping oil prices, it had to put off the budget. Making a statement of that nature does not do anything to reinforce confidence in the economy.

It is hard to imagine that this is the only reason the government would have to put it off. That is one of the biggest reasons the government is being criticized as much as it is in relation to the budget not being presented earlier.

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

Mr. Speaker, I must admit that I always find it amusing to see the selective memory of my colleague from Winnipeg North, who refuses to accept the legacy of the Martin and Chrétien years.

That being said, shortly after my first election campaign, about eight years ago, I was talking with the manager of a big company in Quebec City that had several hundred employees. He told me that he thought the employment insurance scheme at the time was the height of idiocy, because it interfered with labour force mobility. This is in fact a legacy of a Liberal government. I thought his observation was very interesting.

As well, in a debate during my first campaign, I had a chance to bring my Liberal opponent’s attention to the fact that the Liberals had promised a child care system for families for years but had never followed through on their promise.

The Liberals have a pitiful track record when it comes to supporting the middle class. Why is he now boasting about a legacy of standing up for the middle class?