Mr. Speaker, I rise today in support of Bill C-241, sponsored by my colleague from Saskatoon—Grasswood. The bill would amend the Excise Tax Act to allow for a 100% rebate of the GST for school authorities. I would also like to take this opportunity to thank Alex Atamanenko, the former MP for British Columbia Southern Interior, for his work on the bill's precursor, Bill C-259, in the 41st Parliament. I am very pleased to see the bill come back in this Parliament and am also proud to support a fellow member from the Saskatoon area.
The bill is about fairness. School authorities operate under provincial jurisdiction and are funded by provincial governments. Why should one level of government be taxing another level of government? At present, school authorities receive a 68% GST rebate, which means that they pay 32% of the GST on everything they buy. In Saskatchewan alone, that works out to be approximately $8 million that could be spent in classrooms.
Although education is a provincial responsibility, the federal government should not interfere with a province's ability to invest as much as possible in education. An extra $8 million would go a long way to improving and enhancing education services for kids in my province.
Health care is another provincial responsibility, but it receives a 100% GST rebate. Given the increasing pressures on school authorities, the time has come to afford them the same treatment.
It is perfectly logical that school authorities should not use taxpayer money to pay tax on products and services, since they are funded by the provinces. We in the NDP also believe that the federal government must maintain sufficient transfers to the provinces to better fund educational institutions.
The cost of providing educational opportunities for children in Canada is an expensive undertaking, and the level of investment in education is the subject of much debate.
Studies have looked at the level of investment required for education. One of the tools used is called the dependency ratio. It is the percentage generated by dividing the population of children under age 17 by the population of adults aged 18 to 64. In the last census, Saskatchewan had one of the highest dependency ratios, at 49.2%, and was well above the national average. Quebec had one of the lowest dependency ratios. Saskatchewan had the distinction of having one of the highest dependency ratios since 1989.
Research conducted by Saskatchewan school boards indicates that the province has more onerous needs, for both youth and older residents, than other provinces. I quote:
As a result of the age distribution of the population, Saskatchewan is facing needs beyond those of other provinces.... These needs will not disappear. This province has a larger proportion of young people of school age and a larger proportion of individuals over 65. In other words there are fewer people of working age to support those who are not working. There are fewer people to pay the taxes required for support of services such as education and health.
According to the same research, the realities that exist in my home province are the following: Saskatchewan has more young children per working-age person than any other province; Saskatchewan has more senior citizens per working-age person than any other province; the federal government is downloading spending on public programs and services, and this has an indirect effect on education; and Saskatchewan is spending a smaller proportion of total expenditures on education than previously while spending a larger proportion than ever before on servicing the debt.
Decreases in education funding have effects on programs for children. That is obvious. In Saskatchewan today, there are classrooms with 35 or more students.
Sadly, the provincial Sask Party government has only made things worse. More than 350 full-time educational assistant jobs were eliminated by this government. Students are not getting the one-on-one attention they need, and as I mentioned, too many classrooms have 35 kids or more. Some schools are crumbling and desperately need repairs, and classes have been forced into hallways, art supply closets, and even boot rooms. Despite years of windfall revenues, new schools that were desperately needed were not built. Now this government's only plan is to plow ahead with a privatized, rent-a-school P3 scheme that costs more and takes longer and hands control of our public assets over to corporations. For example, in Saskatchewan, an American corporation will be responsible for the maintenance of 18 schools.
In its 2014 budget, the Sask Party government in Saskatchewan cut the education capital budget by nearly 20%, taking $23.4 million away from school building and repair needs, despite the desperate need for more classrooms and smaller class sizes to relieve overcrowding.
When the Saskatchewan Ministry of Education delivered its $2.2-billion budget this year, 13 of the province's 28 school divisions were allocated less money than in the previous year. The ministry blamed teachers' salaries and left these individual school boards to make up the shortfall.
Charles Smith, an assistant professor with the Department of Political Studies at the University of Saskatchewan, said the government had effectively shifted its financial obligations onto school divisions. He said, "They're basically asking that institutions do the cuts that they don't want to do themselves. The school boards are left holding the shortfall that they had no hand in negotiating".
It is very clear that school authorities in Saskatchewan, and I am sure elsewhere, are facing huge challenges. An injection of funds via a 100% GST rebate would provide a much-needed boost for school authorities and the communities they serve. The extra money could be used to build and maintain schools, hire more teachers and educational assistants, address inequities in education for indigenous children, and give all kids the one-on-one attention they need and deserve.
How can we be sure that these extra revenues will be used for education? This year the Saskatchewan government retained the GST refund for the health regions, which was normally used as part of their operating revenues. This added insult to injury and put an even more onerous burden on local health authorities.
I began by saying that this bill is about fairness, and I would like to close by reminding my colleagues about the issue of tax fairness. Over the last decade, governments have increasingly shifted the tax burden away from corporations and onto individuals. Canada now has one of the lowest corporate tax rates in the G7.
In 2014, for example, for the first time in Canada's history, more than half the federal government's revenue was shouldered by personal income taxes. If Canada's corporate tax rate was the same today as it was in 2000, we would be collecting an extra $20 billion a year in revenue, enough to fund a national child care program, free university tuition, or a children's dental care program. Instead, it has been cut in half since 2000.
What do corporations do with this money? Sadly, this money is not being reinvested in the way we hoped, in the economy, so not only have we lost out on revenue that could be used to provide services but there is also very little economic benefit derived from these corporate tax breaks. Statistics Canada data shows that Canada's corporate cash hoard is more than $626 billion. That is more than the federal debt and almost a third of Canada's GDP.
If the logic for these corporate tax cuts was to get the economy moving and working, it just is not working. It really is regular everyday Canadian taxpayers who are paying the price. The rest of us have had to make up the shortfall by paying more than our fair share. At the same time, local, municipal, health, and school authorities are being squeezed when governments download costs to an even lower level of government.
In the end, there is only one taxpayer, as our Conservative friends like to say, and in this instance, I would agree with them. We have to stop letting corporations off the hook. We have to stop offloading their fair share of taxes onto individual citizens, who not only pay more in taxes but also have to pay again in another way, by having fewer and fewer services delivered at the local level.
I have seen first hand the realities facing the local school authorities in my riding, and I believe that Bill C-241 would improve their budget situations. However, I would ask my hon. colleague if this bill would in any way mandate that the extra monies be put back into local school authorities or if provincial governments could simply withhold this money and use it any way they wanted.
I am also cognizant that the bill, if passed, would have cost implications for the federal government. According to the Library of Parliament's estimates, the real cost to the federal government of refunding the GST to school authorities was about $339 million in 2016, and then the changes put forward in Bill C-241 could represent additional costs in excess of $160 million annually.
The NDP would like to refer the bill to a House of Commons standing committee so that a thorough analysis could be conducted into the reality that school authorities are facing and the various measures the federal government could take to help them deliver a quality education to children everywhere.