Mr. Speaker, I move that the second report of the Standing Committee on Finance, presented on Friday, March 11, be concurred in.
I will be splitting my time, Mr. Speaker.
I stand today to talk about the business of the finance committee and also about where the government is taking our country from a financial, economic point of view, or should I say mismanaging our economy as it stands today. It could be entitled “A trail of broken promises”.
Let me deal with three of the more major broken promises on which the government campaigned, yet today still has broken the solemn promise to Canadians.
The first is on deficits. The government believes it can spend its way to prosperity. This has been tried by other governments. In my province of Ontario, where I was in business for 25 years, I watched consecutive Liberal governments and NDP governments try to spend their way to prosperity, and it ended in disaster. Today, it is a disaster in Ontario, with our province being the most indebted sub-sovereign government in all of North America.
The promise that was made by the government was small deficit spending. Instead, we find out in the fall economic update that the deficit will be $31 billion for this fiscal year. Let me register that with Canadians one more time. The deficit will be $31 billion, not the $10 billion that was promised. Not one job has been created since the Liberals were elected as a result of spending this money. It is a false message that we can spend our way to prosperity. It is a disaster.
The second is lowering taxes for small business. We all campaigned on doing that, all of our parties. However, when we received the budget last spring, something was missing. It was that small business tax reduction.
All of us know the importance of small business. All of us know the statistics, that 80% of good paying, full-time jobs are created by small business. What does this mean to individuals who are planning expansions, or perhaps who are employing 20 people and are on the verge of employing 10 more or five more people? It means companies have to stop and give it a second thought. It means that as the government moves forward with additional taxes on them, mainly the CPP hidden tax increase, a payroll tax, along with what is coming with the carbon tax, they are now looking at their situation a whole lot differently. In fact, they are thinking that maybe they should just stay small, or reduce the size of their operations, or depending on how long the owners will be in the business, perhaps it is not worth the effort anymore. Many businesses are making that decision.
Make no mistake, as a government, we were heading in the right direction. We were telling them about the tax reductions they would be allowed, the credits for new hires, the EI holiday for new hires, things that were incentives to small business. What we have seen are total disincentives since the present government came to power.
Perhaps the one we heard most about from businesses, large, medium and small, at finance committee during our pre-budget consultations and after the budget was when the government would commit to what it said it would do during the election campaign, which was bring us back to balance. In other words, if the Liberals are to deficit spend because they made that promise, they broke that by spending three times as much as they said.
However, when will the Liberals bring the economy back to balance, bring the books back to balance? We have seen, since the Liberals have been in power for over a year now, that there is absolutely no intention to bring things back to balance.
This is a record that is replaying itself. I remember a time in the early years of my own business when governments were spending like drunken sailors, and there was no plan. It had to come to a reckoning, and it came to a reckoning, with the government having to make major cutbacks in provincial health transfers. It was done in an arbitrary way. It was done without consultation. It had to be done, because deficits had grown beyond the country's ability to go any further in terms of debt repayment.
Another issue has resulted since this administration has come into power, and that is that investments are exiting this country right now. The investment community has looked at things it was intending to do to expand, and it is leaving. Let me give the House an example in my riding.
There is a company in my riding that does heavy forging. It forges large pieces that go into oil and gas and hydroelectric installations. I am talking about forgings the length of this room and four feet in diameter. The company is a huge energy user as a result. Let me talk about this company from a couple of fronts.
First of all, this company also has operations in the United States. When it looks at the cost of producing in Canada, it factors in, every month, enormous costs for electricity and gas. The company is located in the heart of southern Ontario. Ontario today has the highest electricity rates in all of North America. What does that mean for this company? It means that the provincial government does not really care how much electricity is costing it. How much would it be to move its operations south of the border, which is going to happen to more and more companies?
Further to that, at the federal government level, a carbon tax is coming into place. The last time there was an analysis of a carbon tax was during the 2008 election. During that election, there was a Liberal proposal on the table to bring in a carbon tax. The owner of this forging company calculated, per employee, how much more cost would be borne by the business as a result of that carbon tax. At that time, the analysis was $9,000 per employee per year. Do the math. It would be 400 good-paying jobs times $9,000 per employee. I do not have the math for what the Liberal government is proposing now, but it is going to be more than $9,000.
The decisions of this company ride on being competitive worldwide. Those 400 jobs could very well move south of the border. Then there are the changes in the landscape with the new administration in the United States. The new administration in the United States has said that it will reduce taxes to the lowest possible level to bring back to the United States industries that have fled and other industries that want to locate there. Many states have already been doing it with tax holidays for companies, property tax holidays, and credits for employees for a period of time. There have been many incentives. Many of them have been resisted by businesses.
As this go forward, the competitive nature of the way companies like this operate will pretty much be the death knell of many of them in Canada. I fear that. I come from a blue collar community that has a heritage of manufacturing, which we have seen go offshore for many years. The ones we have left, we want to keep, because they are good-paying jobs.
Yet the present government has not created one job over the course of the time it has been in power. “Spend, spend, spend” has been its mantra, never with a plan to pay it back.
I urge all members to pay attention to what is going on in—