Mr. Speaker, I will be speaking on the federal budget today. I will be splitting my time with the member for Etobicoke North.
This budget has no real plan for jobs or growth. It gives the most to people who need it the least, and it keeps Canada in a deficit situation.
The Prime Minister's claim of a balanced budget is about as credible as George W. Bush's claim, in 2003, when he declared “mission accomplished” on the Iraq war. History proved the president wrong; the U.S. remained in Iraq for another seven years.
I think history will prove that this Prime Minister is wrong to declare victory on deficits. It is a cautionary tale about premature declarations of victory. This lesson is lost on the Conservative government. Instead of learning from history, the Conservatives are using this budget to declare mission accomplished in a fiscal year that will not even end until March 31, 2016.
The budget shows that after seven consecutive deficits, the federal Conservatives have yet to balance the budget. Canada has not been in a recession since May 2009. In fact, the Conservatives have been breaking the principle of their proposed balanced budget legislation since then.
Now the Conservatives have fabricated an illusory surplus on the eve of an election. How did they do that? First, they cut the contingency reserve. That is right. In the past, they kept intact the contingency reserve put in place by finance minister Paul Martin. If the Conservatives had actually done that this year, the budget would have shown that the Conservatives would be in deficit until at least 2017.
Slashing the rainy day reserve is just plain reckless. Last year, then-finance minister Jim Flaherty agreed. He said it would be “imprudent” to cut the contingency reserve. Earlier this year, the then-employment minister, now the defence minister, promised that the government would not touch the contingency fund. He said, “We won't be using a contingency fund”, to balance the budget. “A contingency fund is there for unforeseen circumstances, like natural disasters”.
This finance minister and the Prime Minister did not listen to either. Instead, he has recklessly cut the contingency reserve, leaving the government with no room for any unforeseen events.
The finance minister's reckless streak does not end there. His budget also depends on a 50% increase in oil prices. The Bank of Canada knows better than to build its forecasts around the hope that oil prices are going to go up in the mid-term. The Conservatives should be similarly cautious. It is reckless to build a budget around rosy assumptions.
The cut to the contingency reserve, in fact, is not the only item in this budget that is larger than the illusory surplus. There is also the one-time asset sale of GM shares, a $2.2 billion sale of GM shares that is actually bigger than this illusory surplus.
That confirms the reason the finance minister sat on his hands and delayed the budget until April, after the fiscal year had already begun.
Since 2010, job growth in Canada has been stagnant, and with the fall of oil prices, Canadians have been losing their jobs. The Bank of Canada has called the economy in 2015 “atrocious”. The Governor of the Bank of Canada actually took action in January. He stepped in with a historic interest rate cut to strengthen the economy. Meanwhile, the finance minister was nowhere to be found. He went into hiding, avoiding questions in Parliament for months. Now we know the real reason he did this. The finance minister was putting politics ahead of the economy and the Conservatives' political fortunes ahead of the Canadian priority of having a real plan, in a timely manner, to create jobs and growth for Canadians who need them.
He delayed the budget so that the sale of GM shares would count toward this fiscal year instead of last. That is not a plan. That is a gimmick. It is not just unsustainable, it is pathetic. It is playing politics with the livelihoods of Canadians.
The Canadian economy desperately needs a plan for jobs and growth. Instead, the Conservatives remain committed to their fiscally irresponsible plan for income splitting and the doubling of the TFSA contribution limit. They spent the surplus even before it arrived, and they are spending it on those who need the help the least.
Neither income splitting nor the increase to the TFSA limit would do anything for job creation. Neither of these measures would create the jobs and growth Canadians need or help young Canadians find work. Both of these measures would skew benefits toward the rich, doing little for the middle class and those Canadians working hard to join the middle class.
Doubling the TFSA limit would be particularly reckless, because the cost of the measure would ramp up dramatically over time and would gut the capacity of future governments by tens of billions of dollars every year. According to the PBO, a third of that cost would be borne by provincial governments, and because TFSAs would not count toward income-tested benefits, it would also result, perversely, in billions of dollars each year in additional old age security payments for wealthier seniors.
At some level, the Minister of Finance seems to understand that doubling the TFSA would create a problem for the next generation. When asked about that problem, he acknowledged that there would be a problem and said “why don't we leave that to [the Prime Minister's] granddaughter to solve”.
Canadian parents believe in building a better country for our kids and our grandkids. We do not believe in burdening the next generation with today's tax breaks for the rich. We do not believe in gutting our social safety net to pay for those tax breaks.
The Conservatives do not get this. They have grown out of touch with the challenges faced by middle-class Canadian families. Instead of building for the future, the Conservatives have engineered, effectively, a reverse mortgage on Canada's fiscal house to help them pay for giveaways to the rich. Doubling the TFSA limit would dramatically reduce the government's capacity in the future to invest in what matters.
All of this is bad enough, but it was only three years ago, just shortly after the last election, that these same Conservatives falsely claimed that they had to raise the age of OAS from 65 to 67 because of financial pressures. They falsely claimed that the OAS program was not financially sustainable. They passed these measures in Bill C-38, the spring 2012 omnibus budget bill, which resulted in cutting OAS and GIS to Canada's most vulnerable seniors for two years.
When fully implemented, Bill C-38's cuts to OAS and GIS will take $32,000 away from each of Canada's poorest and most vulnerable seniors. The Conservatives will be taking that money from low-income seniors at precisely the time when doubling the TFSA limit will start to get really expensive for the government and when the extra OAS payments for wealthier Canadians kick in.
The Conservatives are playing anti-Robin Hood. There is an adage that the rich get richer and the poor get poorer. Under this Conservative budget, it is now official government policy.
Raising the age of OAS and doubling the TFSA limit would take money away from the poorest, most vulnerable seniors and would give it to the rich. It would give that money to the select few who have an extra $10,000 burning a hole in their pockets every year. We need to keep in mind that some families are wealthy enough that there would in fact be two adults who could each contribute, so that is $20,000. I do not know a lot of families like that in Kings—Hants. People are working hard. They are struggling. Middle-class families are barely getting by.
The Conservative decision to take from the poor and give to the rich is unfair and un-Canadian. It is another example of how out of touch with the priorities of Canadians and the challenges of middle-class families the Conservatives have become.
The budget has no plan for jobs and growth. It would do next to nothing to help Canada's struggling middle class. It would do the most for the people who need it the least, the rich, and it would keep Canada in deficit.
A Liberal government will have a real plan for jobs and growth and support for Canada's middle class, and we will balance the books.