Mr. Speaker, I will be sharing my allotted time with the hon. member for Scarborough—Guildwood.
I appreciate this opportunity to speak today in response to a motion of the hon. member for Regina—Lumsden—Lake Centre to the effect that the benefits of the accord on non-renewable resources signed by Nova Scotia and Newfoundland and Labrador should be extended to all the provinces.
This motion raises a question often debated in this House, namely the so-called fiscal imbalance. It is appropriate that I now address it in the context of this specific motion. With all due respect to those who believe that such an imbalance exists in Canada, I say they are wrong, and there are several reasons for that.
First, I think that all our critics have to recognize that there is one fundamental difference between Canada and most federations: the Government of Canada and the provinces have access to the same major sources of revenue to finance their operations. The provinces also have exclusive access to several sources of revenue in their jurisdictions, such as natural resource royalties and gaming revenues.
Second, under the Constitution, the provinces have full jurisdiction over the tax bases under their control. They also have a free hand to develop their own tax policies, set personal and corporate tax rates and decide how to use their tax revenues.
Third, despite the significant progress made in recent years by this government in reducing the debt, the federal debt remains twice as high as that of the provinces. As the father of four and grandfather of five, that is not the legacy I want to leave to my family and to Canadian families. It is important that we reduce this debt.
Finally, we have to take into account that the Government of Canada and the provinces are partners in many areas, including several over which the provinces have full jurisdiction. Take health, post-secondary education, social services, infrastructure and housing for example. The federal government has been contributing more and more in these areas over the past several years. Its contributions are currently at an all time high. That is right, an all time high, and they will continue to grow.
When we factor in the federal transfers, we can see that the provincial and territorial revenues clearly exceed federal revenues. This has been true for more than 20 years, and is not likely to change in the foreseeable future.
Let us look at the benefits derived from this cooperative form of governance. The 10 year plan to strengthen health care is one of the best examples of cooperation involving the various levels of government. In fact, the Prime Minister of Canada and his provincial and territorial counterparts have all signed it. The Government of Canada has promised to spend more than $41 billion over ten years to support the plan, thus acting on all the financial recommendations of the Royal Commission on the Future of Health Care in Canada, the Romanow commission.
An additional sum of $700 million over five years has also been announced for aboriginal health care programs, along with $150 million for health care services in the North.
The Senate is currently studying Bill C-39, which implements the 10 year plan to consolidate health care. Once this bill has been adopted, the provinces and territories will be able to respond to the concerns of Canadians in such important areas as wait times reduction in order to ensure that Canadians have access to essential health care in a timely manner, and they will be able to fund the purchase of essential diagnostic and medical equipment.
Then there is the new framework for the equalization formula and the territorial funding formula or TFF. In October, the Government of Canada established a new framework for equalization and the territorial funding formula, which provides for the transfer of $33 billion in additional funding over the next 10 years.
This additional funding for the provinces and territories will mean that all Canadians will have access to reasonably comparable public services at reasonably comparable rates of taxation, no matter where they live.
This framework includes the five following elements: first, a minimum funding floor of $10 billion for equalization and of $1.9 billion for TFF for 2004-05; and complete protection for provinces and territories against declines in payments in 2004-05 below the amounts estimated in the 2004 budget.
There is also a guaranteed increase in funding for 2005-06, to $10.9 billion for equalization and $2 billion for TFF, and a guaranteed growth rate of 3.5% per year compared to this level over the next 10 years.
Finally, for the first time the government is creating an independent panel to advise on how legislated equalization and TFF levels should be allocated among the provinces and territories. The provinces will be represented on this panel. The legislation establishing the new equalization and TFF framework recently received royal assent, and the provinces have started to receive the amounts allocated. One of the things the provinces and territories had demanded was stable and predictable funding. This is exactly what the Government of Canada has provided.
However, the government did not stop there. I want to mention a few of the positive initiatives in the 2005 budget for Canadians or the communities in which they live.
These funds will be allocated to health care professionals and resources for healthy living, the prevention of chronic disease, flu epidemic preparedness, drug safety and environmental health. These funds reinforce the $805 million the Government of Canada is investing directly in its responsibilities.
The Government of Canada is committed to enhancing its assistance to regional and sectoral development. This year's budget gives priority to strengthening support for innovation and local capacities to meet the challenge of adaptation, investment in northern initiatives, and targeted investments to increase the contribution of certain key sectors of the economy to Canadians' standard of living.
More specifically, the 2005 budget helps to strengthen the economies in the regions through the following initiatives: $800 million more in funding to regional development agencies in Atlantic Canada, western Canada, Quebec and northern Ontario. Having been the minister responsible for this portfolio in Quebec, I can state that this funding will be extremely useful for the economic development of all of Quebec's regions. In addition, $120 million will be allocated to an overall northern development strategy, and there will be additional investments in certain key areas of the Canadian economy, such as agriculture and the space industry.
Hon. members will recall the new deal for the communities which was inaugurated as part of the 2004 budget. With it, the Government of Canada implemented the preliminary measures of the new deal with the reimbursement in full of the goods and services tax, the GST, as well as the federal portion of the harmonized sales tax, the HST, to the municipalities. This initial step will make it possible to provide the municipalities with more than $7 million over 10 years to help them finance their fundamental infrastructure priorities, particularly roads, public transport and water purification.
The 2005 budget takes this still further by respecting the Government of Canada's commitment to share part of the revenue from the federal gas tax in order to support a sustainable and environmentally friendly infrastructure. This commitment will take the form of a new contribution of $5 billion to cities and communities for infrastructure over the next five years.
The new deal goes further than the commitment on gasoline taxes. It is designed to establish new, lasting intergovernmental partnerships and to find new ways of doing things. The governments have worked together to ensure that our health care system has a future, and we have worked together on equalization and the territorial funding formula to establish a detailed plan enabling the provinces and territories to prepare for the future. There is no doubt that all administrations must continue to work closely together in order to achieve real, lasting change.
In short, it is incorrect to say that the government has and jealously guards an unfair financial advantage. In fact, all administrations have the same duty of providing services of the highest quality to all citizens, no matter where they live.
That is exactly what Nova Scotia and Newfoundland and Labrador are seeking to do. The agreement on offshore resources recognizes the special circumstances these provinces are facing. The Government of Canada has seen a need and has intervened to help standardize the rules of the game with respect to other provinces.
After all, Canadians help each other out, right?
Canadians have made it clear that they all want to see their elected representatives cooperating to achieve this goal. Let us set aside these petty quarrels about fiscal imbalance and move on to more positive and more productive debates on practical ways to meet our obligations and on what we can do in the future.
That is how it works where I come from, in the Beauce. When someone has a problem, no one looks for a guilty party; we search for a solution, and that works well. Thank you for your attention.