Mr. Speaker, as the member of Parliament for Renfrew—Nipissing—Pembroke, I am pleased to have this opportunity to speak on behalf of the good people of my riding. I thank them for the confidence they have placed in me to be their elected representative, and I in return promise to do my best to protect their interests.
People in my riding are concerned over the contents of Bill C-15, which implements most of the government's first federal budget. They are concerned about the huge, never-ending deficits contained in the budget and the legacy it leaves for their families.
I am proud of the Conservative government that left a budget surplus. In fact the debt-to-GDP ratio was lower than it was when we got in, despite experiencing the greatest global recession since the Great Depression. We balanced the budget, running a $1.9-billion surplus in 2014-15. The books were also $600 million in surplus when we left office in October 2015, which was confirmed by the non-partisan parliamentary budget office. We gave Canada a healthy financial balance sheet with rising revenues that could have been used to pay for the Conservative small business tax cut that was reversed by the government.
The difference between Conservative debt versus Liberal debt is that Conservatives will go into debt like a person getting a mortgage on a home, eventually owning a home and having a place to live while paying off the mortgage. The Liberal budget is like someone going into debt by using their credit card to buy groceries without the funds to make the minimum monthly payment on the credit card.
Under Conservative budgets, eventually the individuals own their homes. Under the Liberals budget Canadians are never expected to pay off the mortgage and go hungry. It is left to the next generation to keep paying the mortgage on the family home.
A budget document is supposed to inspire confidence in an economy. Only by inspiring confidence will consumers loosen their purse strings and entrepreneurs invest in their businesses. Unfortunately for Canadians, investors spoke with their actions before the Minister of Finance rose in the House to deliver his first uninspiring budget.
There is a profound lack of confidence in the government. That is evident from the day it was elected. These are the science-based facts. According to Stats Canada, in the fourth quarter of 2015, which was after the 2015 federal election, billions of dollars had been transferred out of the country by Canadian investors. This represents the largest recorded flight of capital since records began to be kept, stretching back before the Great Depression. For the first time, Canadians are net creditors to the United States, an unprecedented occurrence.
It would appear well-connected insiders got all their cash out of Canada while the going was good. What that means for Canadians is that those private investment dollars are not available to create Canadian jobs, forcing Canada to further increase the national deficit while becoming more indebted to foreigners to replace the lost capital.
In another development that is causing a lack of confidence in the government, Canada has sold off all its official gold holdings. The Bank of Canada on February 23, 2016, showed gold reserves at zero. This is in stark contrast with other developed countries that have seen their central banks become net buyers of gold since 2010. Canada now stands as the only G7 nation that does not hold at least 100 tonnes of gold in its official reserves. Out of 188 member countries in the International Monetary Fund, 100 countries hold gold as part of their monetary assets. Canada is now among the 88 countries that have no gold, countries such as Angola, Belize, and Tonga. Are these coincidences or a sign that Canada is headed for financial disaster?
Not since the disastrous budget of former finance minister Allan J. MacEachen, when five-year mortgage rates spiked to over 21%, have Canadians been more apprehensive about their own personal financial security.
It has to be a Canadian record for breaking promises. The first budget deficit is not $10 billion each of the first three years of the mandate as promised. It jumped to $30 billion each of the first three years with no plans to get out of debt and create jobs, if Canadians can believe the $30-billion annual figure. Is it really much higher?
No economist or institution recommended running deficits to finance government waste. In fact, most of the new spending in this budget has nothing to do with promoting economic growth. Any spending on infrastructure is a holdover from Conservative budgets. It was a budget intended to buy votes with the people's money based on election promises, promises that were made to be broken.
Is Canada preparing for a financial disaster? Are savings protected? Those are the questions now being asked of this uninspiring budget that is eroding investor and consumer confidence.
According to the former non-partisan parliamentary budget officer Kevin Page, the budget is heavy on spending programs for government consumption and lacking in details, including when the federal budget would return to balance, which is how our Conservative government left the nation's finances. “It could be better in transparency...it's kind of a budget without a fiscal plan”, according to Page, who also said, “I think there’s going to be pressure to raise taxes with this kind of spending in the budget.”
Higher taxes drive down consumption and investment. This in turn chokes growth and leads to lower tax revenue, which in turn worsens an already out of control debt problem, and so it goes in a vicious cycle that leads to the need to keep raising taxes, credit downgrades, further loss of investor confidence beyond what this budget has already caused, more job losses, and the inevitable deep cuts to things like health care and defence spending that Canadians suffered from when Paul Martin was finance minister.
The non-partisan parliamentary budget officer observed that this is the least transparent budget, certainly when compared to Conservative budgets or even previous Paul Martin budgets.
An example of that lack of transparency is the bank recapitalization bail-in scheme, proposed in division 5, part 4, of Bill C-15, which is page 223 of the budget document. It has seniors, among others, worried. It allows the government to convert a bank's eligible long-term debt into common shares in order to recapitalize the bank. In addition to being concerned about bank deposits, any retirement savings that included the bank shares would be exposed as well.
Canadians entrust their savings to the chartered banks with the expectation of being able to access those savings when they need their money. I know that the people in my riding do not expect their savings to be redirected into common stock when a bank is in trouble. Canadians may use banks for long-term savings or to park money temporarily in what they thought was a safe place, for example, when they sell their home or a family business.
The Liberal government is scaring seniors about the safety of bank deposits. The question has to be asked.
A preliminary proposal was made by former finance minister James Flaherty regarding the charter bank solvency rules. However, under our previous Conservative government's plan, bank deposits were protected from seizure. In addition to financing the federal spending spree, Canada's banks are holding billions of dollars in debts from the oil sands. The depressed price of oil has already caused tens of thousands of Canadians to lose their jobs. Internationally, there are at least five countries with oil-depressed economies that are teetering on insolvency.
Another example of the lack of transparency referred to by the non-partisan parliamentary budget officer is the decision of the federal government to cover up the costs to Canadian taxpayers of the Ontario “greed” energy act. The greed energy act was brought in by the disgraced former government of Dalton McGuinty, and continues to drive electricity prices in the province of Ontario higher and higher. One of the consequences of that piece of misguided extremist-driven policy is the energy poverty that is now a fact of life in the province of Ontario.
It is important to point out to Canadian taxpayers that part 1 of Bill C-15 implements certain income tax measures proposed in the March 22, 2016, budget by exempting from taxable income amounts received as rate assistance under the Ontario electricity support program. The Ontario electricity support program was brought in as an indirect tax levied on all electricity consumers to provide rate assistance for people who cannot afford to pay their electricity bills. Of all the issues that I am contacted on, the cost of electricity in Ontario draws the most complaints. We call this the Liberal policy of “heat or eat” in Ontario. Federal taxpayers are expected to pick up the costs of this budget tax measure.
What I predicted before the last election is now happening, as we can see in Bill C-15. I predicted that Canadian taxpayers would end up with part of the bill for Ontario's policy disasters. That was predictable because the same policy advisers in Queen's Park, who wrote the greed energy act and fled Toronto, are now hiding in Ottawa as the most senior advisers of the federal Liberal Party. The cozy relationship between the Prime Minister and the Ontario premier is bad for all taxpayers, just as I warned Canadians before the last election.
Nowhere in the federal budget do we see a line for the cost of defending the greed energy act in an international court. Canadians should be shocked to learn that because Canada is being sued under the international trade rules for the activities of the Ontario Liberal Party and international trade is a federal responsibility, Canadians could be forced to pay almost a billion dollars in claims. Because of the lack of transparency in this budget, it is not being disclosed how much the budget must be increased to pay for the other hare-brained green energy schemes that do nothing to protect the environment and cost Canadians jobs.