Debates of May 22nd, 2018

Department of Finance—Main Estimates, 2018-19

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, I think that is the reason the minister increased pension costs for businesses, among other things, and abolished the investment tax credits our government had implemented.

Does he think the right approach is to increase costs and abolish investment tax credits for companies?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, the corporate tax rate in Canada is the same as it was before we came into office. It is 15% for large companies but lower for SMEs, because we lowered their tax rate. It will continue to be lowered until it reaches 9% federally. I do not understand the question. The facts on Canadian businesses are there.

[The Chair, Conservative, Bruce Stanton]

We have two minutes left.

The hon. member for Louis-Saint-Laurent.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, we know the facts. The fact is that the Liberal government increased pension fund costs for employees and employers. The fact is that the government reduced and eliminated investment tax credits. It eliminated the tax credit for people who ride the bus. This government prides itself on its lofty environmental principles, but it reduced access to public transit and eliminated measures our government put in place to help bus riders. That measure helped people directly.

Does the Minister of Finance remember last summer's full-on attack against business people? Does he remember having to backtrack in a big hurry because he was about to lead Canada toward a financial disaster?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, we will stay the course with business tax rates that keep us competitive. The fact is that we lowered small business taxes. That is clear. We will listen to what businesses have to say about changes happening in the United States, and we will determine whether things are different here. That is our approach. It is clear that we are well-positioned for the future in terms of our retirement plan for Canadians. It is improved. Our approach is working. Things are good for businesses and for Canadians.

[Mark Gerretsen, Liberal, Kingston and the Islands, ON]

Mr. Chair, I am pleased to have this opportunity to rise in the House to address the somewhat unique debate we are having this evening.

I would like to take the opportunity to highlight one of the central initiatives in budgets introduced by this government, and that is the important role our government is playing in supporting innovation in Canada.

In budget 2017, as part of our plan to build an economy that works for everyone, an economy where Canadians have access to high-quality jobs and where Canadian businesses are well placed to compete in a rapidly evolving and competitive global marketplace, the government launched the innovation and skills plan.

I should have mentioned at the beginning that I will be reading some prepared notes, and then after that I will have a couple of questions for the minister.

Even though that initiative was launched only a little more than a year ago, there have already been many successes. For example, as part of our plan, we launched the pan-Canadian artificial intelligence strategy to ensure Canada would remain a global leader in this exciting field. We also launched the global skills strategy to make it easier for companies to access top talent from around the world.

As part of our plan, we also created six new economic strategy tables that would serve as a new model for industry-government collaboration, and five new innovation superclusters around the country that would create tens of thousands of well-paying middle-class jobs.

At the foundation of this plan is science. Strong science is the pillar for transformative discoveries and innovations that improve our world, such as new medical therapies, quantum computing technologies, new agricultural practices, and more.

The government has heard the strong and united message from the research community on the need to restore and make new investments in the future of Canadian science, one that supports young researchers and embraces the increasingly international, interdisciplinary, and fast-breaking nature of leading-edge research.

I would like to commend the good work done by members of the fundamental science review, who last year presented a report on the state of Canada's fundamental science ecosystem, a review the likes of which we had not seen for over 40 years.

Informed by this work, the government took action in budget 2018 to help make Canada a world-leading centre for research and innovation. We did this by making a historic investment in the next generation of researchers. The next step of our innovation and skills plan will be to ensure Canada has the talented people needed to make important discoveries and to compete in a global economy.

In budget 2018, it was announced that we would invest nearly $4 billion over five years in support for researchers, big data, and state-of-the art tools and facilities to ensure Canadian researchers would have everything they needed to succeed. This will ensure that as we build a forward-looking economy, the next generation of Canadian researchers are qualified for jobs they are excited to have. This includes $1.2 billion for the granting councils, the most ever given in new funding for fundamental research through the granting councils in Canadian history.

As we are on the topic of fundamental research, I note that on April 16 I attended the Queen's University Education Downlink with NASA. This wonderful event featured Canadian astronaut Drew Feustel, live through the first-ever video feed between the International Space Station and a Canadian university. Drew answered questions from attendees and shared his empowering stories. His success is an inspiration to the next generation of Canadian researchers. I am certain the innovation and research funding proposed in budget 2018 will empower more Canadians to reach the heights that he has.

Investments will be tied to clear objectives and conditions so Canada's next generation of researchers is larger, more diverse, and better supported.

I would like to take a few minutes to get into some of the specifics of this new funding.

We know that research expands our basic understanding of the world, generates new ideas, and helps build a workforce that is better able to respond to challenges with creativity and confidence. Through Canada's granting councils, we are doing just that. The government is making a historic investment in the granting councils. This means better opportunities for students and researchers. This investment will provide increased support and training opportunities for roughly 21,000 researchers, students, and high-quality personnel across Canada every year.

The granting councils are also tasked with developing new plans to achieve greater diversity among funding recipients, ensuring that funding reaches a more diverse group of researchers, including more women, members of under-represented groups, and those early in their careers.

To attract and retain leading early career researchers at post-secondary institutions across the country, the government announced new funding for the Canada research chairs program. This new funding will be targeted to early career researchers whose diversity better represents Canada's population.

Better support for Canada research chairs means more support for people like Jason Moffat at the University of Toronto, whose research will help identify new cancer cell vulnerabilities, increase understanding of how cancer begins, and ultimately aid in developing tools to help diagnose and treat cancer; or Gilles Gerbier at Queen's University, whose research on particle astrophysics will help unravel the mysteries of dark matter and deepen our understanding of the universe's vast complexities.

Researchers need access to state-of-the-art tools and facilities at Canadian universities, polytechnics, colleges, and research hospitals so they can carry out the groundbreaking research that makes Canada a leader on the global stage. Through budget 2018, the government took the important step of providing ongoing, stable funding for research tools and infrastructure, supported through the Canada Foundation for Innovation.

Providing Canadians with the opportunity to realize their full potential is not just the right thing to do. It is the smart thing to do for our economy.

In Canada, fewer than one in six small and medium-sized enterprises, 16% in fact, are majority-owned by women, and businesses owned by women tend to generate less than half the revenue generated by businesses owned by men. This can change, and it needs to change if we are to unlock economic growth for all Canadians.

To address ongoing barriers and advance the growth of women-led businesses, the government announced in budget 2018 a new women entrepreneurship strategy, which will be a comprehensive and coordinated approach to supporting women-led businesses across the country.

To improve access to capital, skills, mentorship, procurement, and networking opportunities, all important factors for growing businesses, the government announced $105 million over five years to support women-led businesses, to be delivered through the regional development agencies.

Because we know that growing businesses need customers, the government announced that it intends to introduce measures to increase the participation of women-owned SMEs in federal procurements.

Finally, we know that turning new ideas into world-class companies requires lots of capital. This is why the government announced $1.6 billion in new financing over three years for women entrepreneurs through the Business Development Bank of Canada and Export Development Canada, and an increase to $200 million for investments in women-led technology firms through the Business Development Bank of Canada's women in technology venture capital fund.

Combined, these initiatives will give women entrepreneurs a greater chance to grow, hire, innovate, and succeed.

Canada has a reputation as a global leader in science and innovation. Ensuring that Canada remains this way is why our most recent budget is making historic investments in the next generation of researchers, whose diversity also better represents Canada's population, to lead to breakthrough discoveries that will improve the quality of life for all Canadians.

The government's initiative and skills plan, as I indicated, will help build an economy where Canadians have access to high-quality jobs and where Canadian businesses are well placed to compete in a rapidly evolving and competitive global marketplace. This certainty seems to be working, given that, as mentioned, the plan has already led to the launch of the pan-Canadian artificial intelligence strategy, the global skills strategy, six economic strategy tables, and five innovation superclusters across the country.

The measures our government announced in budget 2018 would help to make Canada a world-leading centre for research and innovation, including by investing nearly $4 billion in new money over five years for support of researchers, big data, and state-of-the-art tools and facilities so that Canadian researchers have everything they need to succeed.

For example, through budget 2018 the government would strengthen the National Research Council by convening large-scale teams of Canada's top scientists to reinforce its research-strength role as a trusted partner of firms of all sizes and of academia. This would advance the high-risk, high-reward research with potential for game-changing scientific discoveries and technological breakthroughs and, in the end, take our ideas to the global marketplace.

My question for the minister relates to the historic investments we have been making. There are so many more different opportunities and so many more different items in the budget that address specifically how we will continue to build on this innovation. I wonder if the minister would like to take the opportunity to comment a bit further and highlight some of the things related to investment in innovation that were addressed in budget 2018.

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, Canadians as innovators certainly seek answers to difficult questions and are always looking for new ways to apply what they have learned. For example, the desire to understand how the human heart works led to pioneering efforts in open-heart surgery and the invention of the artificial pacemaker. Curiosity about how we learn and think led to breakthroughs in machine learning and artificial intelligence, discoveries that are improving our quality of life and putting Canada at the leading edge of research and discovery.

However, as we build a forward-looking economy, better focused on science and innovation and inclusive of women and under-represented groups, we need to ensure that all of our communities are well positioned to benefit. To help foster economic growth in communities across Canada, the government proposed in budget 2018 to provide an additional $511 million over five years, starting in 2018-19, to the regional development agencies to support the innovation and skills plans across all regions of Canada. This means more and better-tailored programs and support for workers and communities, delivered in a way that makes the most impact. This initiative would also tie into the women entrepreneurship strategy to provide nationally coordinated, regionally tailored support for women entrepreneurs, as well as help workers and communities in the west and in the Atlantic region adapt to Canada's transition to a low-carbon economy.

These are just a few more examples of how our government plans to help create the industries and the jobs that will strengthen and grow Canada's middle class for years and for generations to come.

[Mark Gerretsen, Liberal, Kingston and the Islands, ON]

Mr. Chair, being from a riding that has three post-secondary institutions, I have directly seen the impact that these research dollars have. Quite often, when we talk about these investments we do not fully value the economic benefit that we can get later on down the road from these investments. I wonder if the minister can comment a bit more on why these investments are so important so that we can actually see changes in the future, and how those changes can better benefit our economy as a whole.

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, what the member is getting at is at the heart of our government's plan. We said, back in 2015, that we knew we needed to make investments in making our country more innovative, and we knew that to do that, we needed to start with how we could ensure that firms had the potential for success.

First of all, we thought about people and how we could ensure that people are in a positive situation so they can go out and get the training and the jobs. Then, we thought about the fact that people need to have the opportunity and the funding for science and research, as individuals, that would allow them to come up with the kind of discovery research that will bring innovations to them and to the marketplace, whether it is through universities or into business. Then, of course, we need to think about commercialization. That is one of the things that are important in this particular budget, where we have thought about commercialization, for example how we can come up with an intellectual property strategy in a way that we can ensure that we actually drive the success through into companies so we can create more innovation for the future.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, we will continue our conversation on the Liberal carbon tax.

For months now, we have been calling on the government to come clean on the real impact of the Liberal carbon tax. The reason is quite simple: the government has on hand a document that I am currently holding, but unfortunately, the Standing Orders prevent me from presenting it to all Canadians. I have asked the government over a dozen times to table the document in the House, but unfortunately it refuses. It is a simple document. It was published on October 20, 2015. The government has therefore had it on hand since October 20, 2015. It spells out precisely what the financial impact of the Liberal carbon tax will be on Canadian families. Unfortunately, the information we have is completely redacted, struck out.

Why is the government being so secretive?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Speaker, what I just heard is quite interesting. The document in question is from October 20, 2015. Since we were elected on October 19, 2015, I can say that the contents of the document predate our approach to improving our situation with regard to the climate.

We decided that the way to improve the situation for our children and grandchildren is to have a national price on carbon. We know that 85% of Canadians already live in a region with carbon pricing. This approach applies to other parts of the country, where there currently is no price on carbon. With our approach, any revenues could go to the provinces and territories, which may choose to give their residents a tax cut. That is important. That is our approach, and it will likely result in a tax cut for people in places where there is carbon pricing.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, the minister is being a wise guy about a simple document. It reads as follows: “the potential impact of a carbon price on households' consumption expenditures across the income distribution. The key findings are:” It ends there. The rest is blacked out. It is impossible to read anything else.

Why is the minister ashamed of a study that gives Canadians the facts?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, that is obviously not our approach. Our approach involves putting a tax on carbon in regions where such a tax does not exist. Provinces that already have a carbon tax, like British Columbia, Quebec, and Ontario, have experienced healthy economic growth.

I will give a very simple example. In Alberta, a family of four with an annual income of $95,000 will receive a $540 tax cut in a situation in which they pay $500. This means that carbon pricing will put an extra $40 in the family's pockets. This is one approach the provinces can take, but we will see what they do.

I think it is a good idea to offer a tax cut with the money generated by the price on carbon in provinces and territories that do not currently have a carbon tax.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, it is quite remarkable that the Minister of Finance can give specific figures in a provincial example. He has the specific figures for all Canadians in the document that he refuses to release, because he is ashamed of the findings and knows that it will be too costly for Canadians.

The minister keeps saying that this tax is revenue neutral for the federal government. Can he say that his Liberal carbon policy is spending neutral for Canadians?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, 85% of Canadians live in a province that already has a price on carbon. We now want to put the other 15% in the same situation by establishing a federal carbon tax if necessary. The provinces and territories will be able to use the revenue returned to them to lower their tax rates. By determining exactly what they are going to do, we can anticipate what the reduction will be.

I suggest that the member ask the premiers of provinces that do not have a carbon tax whether they are going to cut their citizens' taxes.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, I was a member of Quebec's National Assembly in 2011 when the bill was being voted on, and I voted against it. The people in my riding considered what I had done and then voted me in three more times with an absolute majority. It does not bother me in the least to talk about my record.

I have a very simple question for the minister. A few weeks ago, in Vancouver, in reply to a question about rising gas prices, his leader answered that that is exactly what he wanted because he believes it will make people use less gas.

Does the Minister of Finance feel the same way?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, I believe it is of the utmost importance that we consider how to improve the economic situation of Canadians. It is also important to address climate change, since it will be a real challenge in the future and there will be costs associated with it.

This evening, I am being asked whether the provinces will consider lowering taxes. That is up to them. The question I have for the members here is this. Is there a better approach than putting a price on carbon? I have not heard any suggestions from the members opposite. If they have a plan, we are listening, but in our opinion, and from what we have heard from economists and others who know how to deal with climate change, we need to set a revenue-neutral price on carbon. That is our approach, and it will allow us to reduce carbon emissions in the future while ensuring that Canadians are in a good situation.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, what does the finance minister believe is the ideal price for a litre of gas?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, there is a market, and the price varies depending on the global context. It is therefore impossible to answer that question. Of course, we want Canadian families to be in a good position. We believe that jobs are the most important thing, so that is where we are starting. It is also important to have a good level of economic growth to create opportunities. Fortunately, unemployment is very low, and we have the highest growth in the G7. That is a good position.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, my question was very simple and was directly related to what the Prime Minister of Canada said. He said that higher gas prices were exactly what he wanted. The Minister of Finance was unable to answer my question about what he thinks the ideal gas price is. Canadians can see right through that kind of evasion.

Let's talk about evasion. Two and a half years ago, the government promised to save $3 billion. In March, a Department of Finance investigation revealed that not a penny of that $3 billion in savings ever materialized. That was in March.

Can the Minister of Finance tell us how much money he has saved since March through public spending cuts?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, I did not understand the question. What I can say is that we will keep going with our fiscally responsible approach. Clearly, our approach is working. We are in a positive situation, but of course we need to look at how we can position ourselves for the future to keep the country competitive. That is why we are listening. We have done a lot, but we still have a lot to do. We will keep going with an approach that prioritizes Canadian families, the future, and people who want to have important jobs in the future. We will keep going with an approach that works.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, I am going to repeat the question, and I suggest the minister listen this time. The Liberal government promised to find $3 billion in savings. In March, a government report found that not a penny of the promised $3 billion has been saved.

My question for the minister is perfectly simple. Since March, have the Treasury Board, the Department of Finance, or the Liberal government saved so much as a penny of the $3 billion the Liberals promised?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, we always need to consider how we are managing the economy and how we can produce a budget that works and that improves our future prospects. In our budget, we considered each measure and how it could contribute to the efficiency of our economy and boost our growth rate. That is an approach that has delivered results. It is working. We are going to continue with our responsible approach, with a declining debt-to-GDP ratio, and with investments that are good for the economy.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Chair, the Minister of Finance is the undisputed champion of reckless spending and out-of-control budgets. He promised small deficits, but he ended up with deficits three times bigger than expected. He promised a zero deficit in 2019, but he actually has no idea when Canada will see a balanced budget. When asked about his commitment to find $3 billion in savings, even though a March report concluded that not a single penny of that $3 billion had been saved, he cannot even name one example of savings realized by his government.

How can he expect to be taken seriously?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, our approach involves a significant amount of accountability. We explained that we can continue with a record that is the best in the G7. I said that we are already in a good position, since we have the lowest debt-to-GDP ration in the G7, which is about one-third the average of the other countries. At the same time, during our fiscal-planning process, we can continue to work towards lowering our debt-to-GDP ratio. We are in a good position, with a debt-to-GDP ratio around 30%, and this figure will be around 28.4% in the fifth year. We are therefore in a good position, since the other countries are seeing their debt-to-GDP ratio increase. We are resilient. We will continue to invest in growing our economy in a responsible way.