Lorne Nystrom

[Auditor General's Report, April 17th, 2002]

Back to the Minister of Finance and the auditor general's report, Mr. Speaker. The government has transferred some $7.1 billion to foundations with no parliamentary scrutiny, no accountability and they bypass parliament. In other words, it is a benevolent dictatorship that has gone too far.

Would the Minister of Finance agree to allow the auditor general to audit each of these individual foundations and would he make it mandatory that the foundations be subject to parliamentary scrutiny?

[Government Expenditures, April 15th, 2002]

Mr. Speaker, my question is about the $101 million spent on two airplanes to support the imperial travel style of the Prime Minister.

Can the Prime Minister tell us why officials of three different departments recommended against the purchase? Will he table that information in the House? Can he also tell us once and for all, why do the Liberals need two planes? Is it one plane for the Prime Minister and one plane for his ego?

[Government Expenditures, April 12th, 2002]

Mr. Speaker, I wonder if they will also be paying the $24 security tax when they fly on the Challengers.

Industry Canada, a year ago on March 12, approved a $100 million project for Pratt & Whitney and yet no details of the project were announced to the public.

I want to ask the Deputy Prime Minister, and he is looking around now for the answer I see, but I want to ask him, as the Deputy Prime Minister, how can the government spend $100 million of the public's money and yet not tell the public why that money is being spent and what it is being spent on?

[Government Expenditures, April 12th, 2002]

Mr. Speaker, my question is for the Deputy Prime Minister. It is about the $101 million purchase of two Challenger executive jets by the government.

I want the minister to explain precisely why the government decided to buy these jets despite a memo from three officials of three departments recommending that the government did not follow proper procedure if they did so, and why did they do this without a full cabinet discussion?

Is this real or is this the Liberal version of air farce one and air farce two?

[Leadership Campaigns, April 11th, 2002]

Mr. Speaker, my question is for the Deputy Prime Minister. It relates to the controversy surrounding Jim Palmer and the $25,000 contribution to the Minister of Finance's leadership campaign from an oil company in Alberta. The same Jim Palmer had a contract with the Department of Finance.

Will the Deputy Prime Minister support a recommendation from the Chief Electoral Officer that the rules that now apply to general election campaigns for disclosure of financial contributions be expanded to leadership campaigns in order to achieve full transparency and restore the public trust in this country's political system?

[Excise Act, 2001, April 9th, 2002]

Mr. Speaker, I suppose I should let the member from Nova Scotia explain what is good and bad speculation, and what is big and small speculation. I am not sure if he can do that. It is a pretty arbitrary definition of speculation.

The member for Brandon--Souris would know the answer to that. I certainly could not help him there except to say that the vast body of opinion does not share the concern that he has. The vast body of opinion that is looking into this issue thinks that a very small tax would deter the bad speculation, the kind of speculation that wreaks havoc with the different currencies around the world.

We would need to have this tax to be an effective tax along with the co-operation of most of the major financial players in the world. There are only about seven or eight that are really major, such as the European Community, Britain, the United States and two or three others like Japan. This is a means of doing something to curb the speculation in the world, to curb the volatility of the currencies and also to help the international development fund.

[Excise Act, 2001, April 9th, 2002]

Mr. Speaker, I was in the process of answering a question posed of me by the finance critic in the Conservative Party about the Tobin tax, the tax on the speculation of currency.

I want to confirm to him that speculation on currency occurs on very small margins. A very small tax on the speculation of currency will sort out speculation around the world, which would be positive in terms of international development in the world community.

A tax on speculation would slow down speculation in the world on currency exchanges. Three years ago the House of Commons passed a motion agreeing that we should adopt the idea of the Tobin tax, a small tax that would slow down the speculation of currency and at the same time build up a huge international development fund. I am sure the finance critic of the Conservative Party, on giving it a second thought, would agree with my position

[Excise Act, 2001, April 9th, 2002]

Mr. Speaker, I also want to do more in terms of international development. I want to make sure we have industries in all parts of the world including the developing world. I want people to have well paying jobs, security, food and agricultural development. It is all part of the vision of a new global society.

However we need to fund it in some way. One way is through a tax on international currency. It is not a radical idea. In Canada we have taxes that are based on the ability to pay. We have a progressive tax system. It is not as progressive as I want it to be but it is a progressive system. We have redistribution of income through the taxation system. We have transfers to people in terms of old age pensions. We have transfers to provinces to provide equal access to health care with national standards. We have transfers to the so-called have not provinces in terms of equalization payments. Equalization is enshrined in the constitution.

Equalization is enshrined in the Canadian constitution. It is a good Canadian principle.

We have all these things to try to provide equality of condition and equality of opportunity. We should start applying the same philosophy internationally. The question is how to pay for it.

There may be other ways of paying for it. We could impose other kinds of levies to pay for international development. One of the fairest ways is a small tax on the speculation of currency. It would not affect ordinary people. It would affect some of the huge investment banks and money traders. Some 90% of the money traded during the day is for international speculation.

I have spoken about the issue at conferences around the world. I have spoken about it in Brussels, London, Brazil, at the United Nations and at other conferences. The idea is gaining momentum around the world. The European community is doing a major study on the idea of a tax on currency speculation. France has passed legislation on the issue. Belgium is close to passing legislation.

Most currency trading in the world is done in seven huge centres like London, New York, Frankfurt and three or four others. We need a critical mass to make the idea effective. I hope the hon. member will take a second look at it. Members of his party voted in favour of such a motion in March 1999.

[Excise Act, 2001, April 9th, 2002]

That would be extremely unwise. However here we bring in an airport tax without an economic impact study to see what the impact of that tax will be on communities, on the country and on the travel industry. I do not think it makes any sense.

The last point I want to make concerns a new vision of taxation in the country or in the world. I refer to the whole area of the Tobin tax. The Tobin tax was an idea suggested by Professor James Tobin who passed away about four or five weeks ago. He suggested a very small tax on the trade of currency in the world. Today in the world we have about $1.5 trillion to $2 trillion a day of currency being traded and exchanged. About 90% of the currency trading that is going on is strictly for speculation and mostly done by the large investment banks.

What Professor Tobin had suggested was a very small tax of 0.1%, 0.2%, 0.25% which would slow down some of the speculation in currency that creates havoc in currency around the world. It was done with the Mexican peso and the Japanese yen and many other currencies of the world over the years.

As these investment banks play around with people's currencies they in effect play around with people's lives, throw people out of work and cause all kinds of poverty and despair in the world.

If we had some kind of small international tax it would not affect the ordinary people of this country at all. We could have an exemption on that of $10,000, $20,000, $50,000 or whatever we wanted. If we had a tax of 0.1% it would only be $1 out of $1,000. We would slow down some of the speculation and create a bit more order in the financial markets.

A consequence of this kind of tax would be to create a huge international development fund of several hundred billion dollars to fight world poverty, the AIDS pandemic in Africa and to do environmental cleanups. A lot of that money could go back to the countries that collected the tax to help pay for health care, social services and the fight against cigarettes and smoking that I referred to earlier in my comments.

Three years ago in March I had the honour to introduce a motion in the House of Commons asking parliament to endorse the principle of the Tobin tax or the tax on the speculation of currency in concert with the world community. It passed in the House of Commons by a vote of 164 to 83. We became the first parliament in the world to endorse the idea of a Tobin tax. We had people from all five political parties who actually supported the bill.

Since then we have seen a lot of movement in different parts of the world. The French have actually introduced legislation to participate in a Tobin tax or a currency tax regime once we reach a critical mass in the world community to make this tax effective. Studies are now going on in the European community. The idea of the Tobin tax is being endorsed by many different countries and politicians around the world. There is a growing movement for a global approach toward taxation.

We now have trade deals that are basically charters of rights for international co-operation or charters of rights for investment in the globalized world. These are now very lopsided. What we need is an international global vision where we also would have some rights for the ordinary people in terms of international labour and social standards and goals and objectives, environmental standards and financial institutions that would have the ability and the power to levy a tax against the speculation of currency.

That is the kind of international vision that I think more and more people are supporting, certainly the churches, many of the NGOs and many of the people who live in various parts of the world.

These are some of the things that I believe we should do. We need this new international vision, a new and a modern day global plan to develop many parts of the world that are today suffering from hunger and famine.

Sadly speaking, hundreds and hundreds of people have died of starvation in the last 15 minutes. I think about 20,000 people a day in the world die of starvation. Every hour of the day, hundreds and hundreds of people die of starvation, yet we have this great disparity of wealth around the world. We have the ability through a currency speculation tax to build up an international fund where people of the world could be fed, where there could be the development of agriculture, food production and processing around the world. The technology is there to feed the people of the world, to develop the world and to clean up the environment. We have those abilities. What we lack is the vision and the political will to make it happen.

When we debate a bill like Bill C-47, when we support a bill like Bill C-47, which I do, which I certainly do, we should also look at other parts of taxation such as the unfairness of the levy of employment insurance, the EI fund, which is sitting now with a $43 billion surplus of ordinary people's money. All the time fewer people qualify from the fund. Some 64% of the people who now do not qualified for the fund earn less than $20,000 a year, yet they have to pay premiums.

We should be looking at the unfairness of the airport security tax, this new GST that has been imposed on us and that the government now is using as a tax grab on ordinary citizens. We should look at some new vision in the future in terms of international stability and funding of international programs. The idea here, which is getting momentum around the world, is that of a small tax on the speculation of currency which is causing havoc in so many countries of the world.

[Excise Act, 2001, April 9th, 2002]

Mr. Speaker, I will say a few words about the bill before the House today as well.

Bill C-47 it is a technical bill. It is a bill we in the House support. It would impose a levy on spirits, wines and tobacco products. It would defer payment of duties on spirits and wines to the wholesale level, place domestic and imported products on equal footing, impose tight controls on possession of non-duty paid products and so on. It is a technical bill that would implement some tax changes. There has been a review of the bill. We in my party have no real problems with its technical proposals.

I will comment on a couple of things in the bill. One is the tax on tobacco. I agree that there should be a higher tax on tobacco products in Canada. The biggest health care expenditures we have in Canada are a result of smoking and all the ailments and health problems it causes.

There has been an unofficial agreement between the provinces to raise the tobacco tax. It has happened in Alberta. It happened in the Saskatchewan budget two weeks ago. I suspect the same thing will happen in Manitoba shortly and in other provinces across the country where the price of cigarettes is in roughly the $9 range. The revenues could be used to promote a non-smoking campaign to show the hazards of smoking, particularly for young people. In most cases high cigarette prices are a deterrent for young people to start smoking.

There is a problem on the other side of the issue. A lot of people who smoke are lower income people. When the price of cigarettes gets high it becomes a hardship on them because they are addicted to cigarettes and tobacco products. We get caught in a difficult situation. We are doing the right thing in terms of health and principle, yet at the same time we are catching people who are already addicted to tobacco.

It is a long term process. People need to be educated about the hazards of tobacco. We must make every effort to get people off cigarettes. This involves federal and provincial government campaigns through schools and the like. This is one of the things Bill C-47 talks about.

I will mention two or three things that are not in the bill but which are important when it comes to taxation policy. We have had a government over the last while that has decided to make lowering taxes a huge priority. Before the last election campaign in the fall of 2000 it brought in a budget that would lower taxes over five years by some $100 billion. That was an attractive thing for a lot of Canadian people.

On the other side of the ledger we have seen a tremendous rip-off of employers and employees through employment insurance premiums being much too high. We have seen increased restrictions on who qualifies for employment insurance benefits. The eligibility period has been reduced for those who do have benefits. We now have a surplus of about $43 billion in the EI program. The surplus is predicted to hit $50 billion sometime in the calendar year of 2003.

We are debating a tax bill today but at the same time we are turning a blind eye as a parliament to a great injustice. Workers are being taxed excessively for their employment. The $43 billion EI surplus goes into the Consolidated Revenue Fund. The surplus is there to provide a balanced budget for the Minister of Finance. It is there to provide money for other programs. It is there to pay down the national debt.

Last year $17 billion was put toward the national debt. The $17 billion came directly from workers because of the excessive payments they made into the employment insurance fund. That is very unfair and actually should be a national scandal. The insurance fund should be roughly balanced at all times. I do not mind seeing a surplus of a few billion dollars because at a time when unemployment is low, we can build up a bit of a surplus and when the unemployment rate increases, without increasing the premiums or increasing them only marginally, we can have a deficit running for a while and come out balanced over a five or ten year period.

That was the whole purpose behind EI in terms of funding. Today about two-thirds of the surplus in the employment insurance fund is being generated by low income Canadians not by Canadians who make a lot of money. We tax the poor and people of modest incomes. That is not fair or just.

Many people have lost access to the EI fund because of the tighter qualifying restrictions brought in by the federal government. About one million families have lost access to the fund since 1993 when the Liberal government took office. About 41% of the people who have lost access to the benefits make less than $15,000 a year. Another 23% who have lost access to EI benefits make between $15,000 and $20,000. That is 64% of the people who have lost access to these benefits make less than $20,000 a year. Although they have lost access to the benefits, they still pay into the EI fund. They have provided the federal government with almost a $43 billion surplus today and will provide $50 billion over the next calendar year. It is a very unfair tax from a government that calls itself liberal. That is of course something that is not referred to in the bill that we are debating today.

I want to talk now about the airport security tax which was debated in the House and went into effect on April 1. It was no April fool's joke. It is a tax that will not fly in this country. It is a flat tax of $24 on a return ticket. People will pay $24 tax whether they fly from Saskatchewan to Prince Albert, Regina to Saskatoon, Edmonton to Grande Prairie, Edmonton to Calgary or Toronto to Ottawa. The tax is the same if one flies from Regina to London, Paris or New Delhi. There is no relationship whatsoever to the price of the ticket.

The tax will hurt small communities and short haul flights. It will harm the small airlines such as Athabasca Air in Saskatchewan which has short haul flights between Regina and Saskatoon. The $24 on a $100 or $150 ticket is a huge percentage on a short haul flight. That is another example of a very unfair and unjust tax.

The tax will apply to everybody from the age of two and up. Infants up to the age of two who travelled with an adult could fly free and children between the ages of two and 12 received a large discount but not today. The $24 tax applies equally to every Canadian citizen from the age of two and up. I see that as an example of an unfair tax.

Another reason the tax is unfair is that it was supposed to be implemented to pay for enhanced security at airports. No one in the House would oppose the idea of increased security at airports after September 11 but the tax will collect $1 billion or $2 billion more than is needed to provide for security at airports. In some cases the tax will collect as much as it costs to run the airport. In Saskatoon the city and airport authorities who studied this security tax estimated that Saskatoon will raise some $5 million a year from passengers who fly through the Saskatoon airport. Meanwhile, it costs $5 million a year to run the entire airport, which includes the costs of heating, cleaning and everything else.

Regina will raise $4.5 million through the security tax paid by people leaving Regina. The cost of running the airport in Regina is about $4.8 million. The money coming in from the security tax is enough to run the entire airport but it is supposed to cover security. No wonder people get cynical of politicians and governments when we have this kind of a regime and this kind of tax.

The security tax was implemented without an economic impact study being tabled by the Minister of Finance or the Minister of Transport. The most fundamental thing we do in parliament is taxation. The whole philosophy of parliament is representation. We do not have taxation without representation. We have representation in the House of Commons from all the people of the country yet we have a bunch of puppets in the House of Commons who get up and say yeah to the Minister of Finance for implementing a new tax without tabling a study or a document in the House showing the impact it will have on the Canadian people.

It is like having a benevolent dictator sitting over there. Sometimes he is being very benevolent when he brings in the bill without a study.

What do we teach kids? Normally we teach them to do their research and their homework when they go to school. They need to have some data and facts on which to base an argument or write a term paper. However here in the House of Commons we bring in an airport security tax without an economic impact study. That does not make any sense. It would be like the member for Edmonton North going off and riding her motorcycle without learning how to ride a motorcycle.