Jean-Guy Chrétien

[Borrowing Authority Act, 1995-96, March 2nd, 1995]

Madam Speaker, there is no question in what the hon. member for Glengarry-Prescott-Russell just said. The name of his riding is so long, it reads like a newspaper. My point is that the Western Grain Transportation Act has been in force for 98 years. It has always cost billions of dollars to operate. Yes, Transport Canada did reduce the amounts involved gradually, from year to year.

If you look at the books, you will see a sum of $560 million mentioned in there. Did you know that grain was stored in hopper cars, shipped to Thunder Bay and then back to Vancouver? This system was administered by our governments, and the Liberals have been in power almost all the time since 1960. The Liberals just watched hopper cars travel back and forth at taxpayers' expense. Let us pay.

Now, they want to save $560 million in the future, while paying out nearly $3 billion. This is a disgrace.

How much is there for Quebec farm and dairy producers in there? Nothing, as usual; in fact, they have to make further sacrifices. Madam Speaker, our colleague, Mr. Landry, would have a question, if you would recognize him.

[Borrowing Authority Act, 1995-96, March 2nd, 1995]

Madam Speaker, Réjean Pommainville is not from Saint-Laurent-Cartierville but from Russell, in the hon. member's riding. He said: "We can assess at $4,500 the loss per dairy farm in Ontario".

How much will the dairy producers in his riding receive as compensation? Nothing! How much will Western producers receive? An amount of $2.9 billion. That is unfair. Since forty-seven per cent of industrial milk is produced in Quebec, Quebecers will be hit hardest by this budget. Dairy producers know it and I hope that they will understand some day.

In August 1995, when the Canadian Dairy Commission is asked by producers to approve an increase in the price of milk, it will probably agree and pass on to all Canadians the increase that you did not have the courage to impose. It will be a consumption tax on butter, cheese, yogurt and ice cream.

[Borrowing Authority Act, 1995-96, March 2nd, 1995]

Madam Speaker, I thank my colleague opposite, the Liberal Party whip and hon. member for Glengarry-Prescott-Russell, for his question.

It is true that he has many farmers in his riding. However, I read yesterday in a newspaper that one of his constituents, Réjean Pommainville of the FAO in the riding of Russell, said: "The withdrawal of the dairy subsidy represents 6 per cent of farm income for Ontario dairy producers". He went on to say: "We can assess at $4,500-" It is one of your constituents and not someone from Frontenac.

[Borrowing Authority Act, 1995-96, March 2nd, 1995]

Yes, lies, Madam Speaker.

Other budget measures will also have a strong impact, for example the 30 per cent cut in the social safety net for farmers. The Minister of Finance opposite should listen more closely, as he is the one who will cut $250 million over three years. That, too, is a three-part program. If the federal government contributes 70 cents, will the $1.00 paid by the farmer and the province be increased to $1.15? I am asking the question.

I am also concerned about the closing of two of the seven research facilities in Canada. In Quebec, two facilities will be closed, one in La Pocatière and one in L'Assomption. That is terrible.

Of the $164 billion in this year's budget, $50 billion will be used only to pay interest costs. Let me give you an example of mismanagement.

On April 1, 1997, after investing more than $7 million in La Pocatière in less than 10 years, Agriculture Canada will close the experimental farm in La Pocatière, the oldest one in Quebec, which opened in 1910. They are closing it now after investing $7 million. Where is this government's vision?

In closing, I urge Quebec farmers, whether they are dairy, beef or pork producers, farrow or finish operators, to open their eyes and look at the Liberal government opposite that is treating them so unfairly and inequitably.

[Borrowing Authority Act, 1995-96, March 2nd, 1995]

Meanwhile, the government has no plans for real tax reform. It will raise the corporate tax rate by 12.5 per cent or 1/8, but I used to teach math, and 1/8 of what is not much in any case barely adds up. So what it really means for the big corporations is that there will be an increase from 0.2 to 0.225 per cent of corporate capital in excess of $10 million. Let me tell you that a lot of people in my riding would be delighted to have that rate applied to their personal income tax.

That being said, as the official opposition critic for agriculture and being a farmer myself, I was particularly surprised and, in fact, appalled at the inequity of the budgetary measures concerning agriculture. Last week, the Minister of Agriculture said to anyone who would listen that his government would treat all Canada's regions on the same footing, and he said quite seriously that no agricultural sectors would be more equal than

others. Now we must face the fact that the government is saying one thing but doing another.

In this budget, the finance minister cuts the agriculture department's budget by 19 per cent, or one fifth. During a time of cutbacks, it is accepted that everyone has to do his share, but what really hurts is the way the cuts are distributed. It is one thing for agriculture to be hard hit, but quite another if it is unfairly affected. The injustice from one region to the next is simply absurd.

In short, to make up for eliminating the Crow's Nest rate for Western grain transportation, the government will give grain growers $2.9 billion. But dairy producers in Quebec will see their federal subsidies cut by 30 per cent over two years. That amounts to a $32 million cut without any compensation whatsoever.

The message is clear but unacceptable: the deficit is being tackled on the backs of Quebec and Ontario dairy producers. It can even be said that if the target price for milk were increased because of these cuts, the increase would be borne by consumers and processing industries. It is tantamount to a consumption tax.

Certain cuts are inevitable, I must agree. The agriculture minister was telling me last week that so much had been said about the Crow's Nest rate over the last 25 years. Even in the opinion of farmers and people involved in grain transportation and processing, there were serious shortcomings in the Western grain transportation system, such as the detour to Thunder Bay to be eligible for the subsidy.

For ages people have seen the waste and inefficiency in grain transportation. And the saga has continued since the Liberal Party sitting opposite us took office. They have consulted, gone around in circles, did some fancy footwork in the House and tried to arrive at a consensus with the people in the community. Nothing has worked.

The Minister of Finance finally decided to discontinue the transportation subsidy under the WGTA. To compensate Western grain producers for this loss, the finance minister announced a number of interim measures. For example, owners of agricultural land, in the Prairies only of course, will receive a single, non-taxable lump sum payment of $1.6 billion.

Add to this the $300 million, 5 year program to help producers adapt to the WGTA. On top of this, export credit guarantees totalling one billion dollars are being offered to help producers sell their grain and other foodstuffs. The sum of these three programs is $2.9 billion. The federal government will invest close to $3 billion to compensate grain producers in the three western provinces.

And just listen to how clear and praiseworthy the agriculture minister's goals are. First, to cut costs; second-listen up all of you producers in Quebec-to encourage farmers in the West to diversify; third, to encourage them to get involved in value-added activities. In contrast, dairy producers miss out. The Minister of Finance decided to reduce the subsidies for industrial milk producers by 30 per cent. How terrible.

For all intents and purposes, Quebec accounts for close to 50 per cent of Canada's industrial milk production, so do not kid yourselves or try to tell me that Quebec producers will not be harder hit than those elsewhere. In this case, the federal government is not offering any compensation. In Quebec alone, this cut will mean close to $32 million in losses. The Minister of Finance was off target when he reduced dairy subsidies by 30 per cent over the next two years.

The more than 12,000 industrial milk producers in Quebec will see a 15 per cent drop in their current subsidy of $1.50 per kilogram of milk fat in 1995 and another 15 per cent drop in 1996. For a farmer who produces 10,000 kilograms of fat, which is the average production in Quebec, that will translate into an income loss of $2,250 this year and of almost the same amount next year. That is over $4,000 in losses.

The government will compensate these farmers by reviewing the future of subsidies in collaboration with the provinces and the industry. It is all well and good to talk about it, but that is not going to put bread and butter on the table. Contrary to the cuts in the West, the dairy sector cuts will not be implemented in tandem with any transitional measures. Talk about a double standard.

If we examine this question more closely, we realize that, over the long term, this measure is even more disastrous for dairy producers than it appears. With the new international figures, all sectors are going to have to adjust. In the case of sectors with quotas, like dairy production, these changes are practically already in effect. This coming July, quotas will be replaced by tariffs.

I would like to digress a moment on the subject of tariffs. You no doubt know that the United States decided it wanted to test the tariffs adopted last year, in December 1993 that is, by the 120 members of the WTO at the Uruguay round of the GATT talks. Today, they are being contested. I am really looking forward to seeing how vigorously the government will protest, just how far it will go to defend the tariff structure for dairy products, eggs and poultry.

The tariffs themselves will gradually disappear. Instead of anticipating costs and investing to provide support for dairy producers wanting to develop new niches in the market or become more competitive in order to face the music once tariff barriers relax, what do they do? They cut, they cut and they cut some more.

A dairy producer friend of mine, whom I will identify, I am sure it would please him,-Laurent Saint-Laurent-told me, when he acquired his parents' farm in 1971, that subsidies represented 25 per cent of his income. Today, they represent barely 6 per cent.

However, in the West, farmers are being compensated for the loss of subsidies by being allowed to diversify their economy so they can then compete with agriculture in Eastern Canada, which receives absolutely no financial assistance from the federal government.

They are exaggerating by cutting a number of subsidies. Western producers wanting to get into beef or pork or wanting to compete with dairy producers will therefore be able to do so with federal money. If this is what fair treatment for everyone means, I would hate to see what unfair treatment means in this country.

[Borrowing Authority Act, 1995-96, March 2nd, 1995]

Madam Speaker, you may have guessed that I am particularly interested in the budget's impact on agriculture.

However, I would like to start by commenting briefly on the underhanded way the provinces are being treated, the lack of job creation measures, unfair tax measures and the inequity of certain cuts. If I were to give my impression of the budget brought down by the Minister of Finance in a single sentence, I would call it next year's budget.

As usual, the budget we were supposed to set this year has apparently been postponed until next year, in other words, until after the referendum.

This budget is like a time bomb, and it will be a couple of years before we feel its full impact. Take, for instance, transfer payments to the provinces. In the budget brought down on Monday, transfers for health care, education and social assistance will be cut by $2.5 billion in 1996-97 and $4.5 billion in 1997-98. This is a cut of 40 per cent over three years.

This measure will very likely destabilize provincial budgets and force the provinces to make drastic cuts or even shift part of the burden to the municipalities, as Quebec Liberal Minister Claude Ryan did so neatly in 1992.

And on top of that, there is the obligation to meet so-called national standards. Once again, the provinces are sitting under a federal sword of Damocles.

In the last federal election, the Liberal government was elected on its promise to create jobs. However, after barely a year and a half in power, that same Liberal government decided to ignore its promise to create jobs. There is nothing in Monday's budget to create employment. Nothing but layoffs, as many as 45,000. There is nothing for 800,000 unemployed workers who are looking for work in Quebec. Nothing. The only program that has created some employment and so-called temporary jobs, the infrastructure program, will lose $200 million from its initial budget announced last year.

This is a three-way program, so that in the end, not $200 million but $600 million will be cut.

This budget is unfair because it maintains the preferential treatment of family trusts for another five years, which will give the parties concerned plenty of time to find other ways to evade taxes, and believe me, they will. It is unfair because it comes down relatively hard, but on the wrong people. In the short term, the public will feel the impact of tax hikes on tobacco and gasoline.

Furthermore, the Unemployment Insurance Program will be cut by 10 per cent. The government is going to take money from the unemployed to pay off our debt. This is obscene!

[The Budget, March 1st, 1995]

Mr. Speaker, I rise now at the end of the day to point out that, in my question of February 28, I spoke of the gross injustice in the budget which the Minister of Finance brought down this Monday.

To clearly define this injustice, I would like to repeat part of the question I put to the Hon. Minister of Finance this week. My question was for the finance minister and was more or less as follows: Yesterday, the finance minister announced that grain transportation subsidies would be eliminated, adding that a generous compensation of close to $3 billion, which includes direct subsidies, would be given to western producers.

I have done some research since then and have in fact found that grain producers in the west, and only in the west, would be offered between $15 and $18 per acre, or an average of some $15,000 to $18,000 per grain producer.

Of course, the Crow rate was intended for grain transportation from point A to point B, with point B located near the ocean, most often in Vancouver. Looking again at WGTA issue, we found that many producers stockpiled their grain in railway hopper cars. The railway cars went to Thunder Bay to be eligible for the subsidy before returning to Vancouver. This was costly to the government.

I would like to talk about the unjust and unfair way that farmers in the east of the country have been treated. On the one hand, the government cuts $560 million in subsidies to farmers in the west and, to clear its conscience, offers them a compensation package of close to $3 billion to help them diversify their crops; on the other hand, in the same budget, it trims industrial milk subsidies by 30 per cent.

I did my math and realized that a 30 per cent cut will result in losses. As we all well know, Quebec and Ontario produce 80 per cent of Canada's industrial milk and the cut will result in losses of anywhere from three to five thousand dollars. What compensation will farmers in the east get from the Liberal government? None.

This inequity in the budget is noteworthy, and I expect an explanation now and not a canned response.

[The Budget, February 28th, 1995]

Mr. Speaker, my question is for the Minister of Finance. Yesterday, the minister announced that the grain transportation subsidies would be eliminated, adding that a generous compensation of close to $3 billion, which includes direct subsidies, would be given to western producers. The minister also reduced by 30 per cent the subsidies to dairy producers, who are not so lucky since they will not be getting any compensation.

How can the Minister of Finance justify such an unfair double standard: dairy producers, most of whom are in Quebec, will not get any financial compensation, while western grain producers will?

[Atlantic Canada, February 22nd, 1995]

Mr. Speaker, the United States is getting ready to encroach on an area and our farmers are not at all happy about it. In Quebec, farmers know what supply management means.

In December 1993, I participated in an information session put on by the UPA in Beauce. The meeting was held in Saint-Georges. We were told, with input by Yvon Proulx, senior economist at the UPA, that, under the GATT, we were going to

have to drop milk quotas, which would be replaced by import tariffs. These import tariffs would be so high that they would prevent, to all intents and purposes, the entry of supply management commodities, such as dairy products, eggs and poultry.

Both the farmers and I were sceptical, but the UPA kept on repeating that the freshly elected Liberal government had given guarantees.

However, Canada and the United States each have their own interpretation of the FTA and NAFTA. On the one hand, we have Canada, which claims that converting import quotas for dairy products into tariff equivalents, as the GATT agreements stipulate, takes precedence. On the other, we have our American friends, who claim that NAFTA prohibits the use of tariff equivalents.

Yesterday, the Prime Minister assured me "from one Chrétien to another" that he would bring the issue before a WTO panel if the Americans did not stop pestering Quebecers and Canadians. Today, I would like to remind the government that, under the GATT agreement, Canada's agricultural tariffs for each commodity will be reduced by 36 per cent over six years, with a minimum reduction of 15 per cent per commodity. That is what was promised to farmers in order to let the GATT be passed, in December 1993.

By July 1995, therefore in a few months, the tariffs should be as follows, to quote a few: butter, 351 per cent; cheese, 290 per cent; powdered milk, 250 per cent; chicken, 280 per cent; eggs, which have the lowest tariff, 192 per cent; milk, 283 per cent and ice cream, 326 per cent.

These high tariffs will protect producers in Quebec and Canada for several years to come, despite tariff reductions of 15 per cent to 36 per cent over the next six years.

The important thing for our farmers is not to produce but to secure markets for their products. That is why this government must stand up and show once and for all that, under section 309 of NAFTA, Canada can invoke section XI of the GATT agreement to protect its agricultural industry. I hope that this government will show more backbone than it did in the durum wheat dispute last summer.

Supply management is nothing new in Canada. In fact, dairy products have been supply managed since 1972. There were then 17 cows in the average dairy herd, compared with 48 today.

We must remember that, in 1971 and before, farmers had a little bit of everything. They used to keep three or four pigs, one or two horses, beef and dairy cows, sheep, chickens; it was almost a zoo.

Today, our farmers specialize in pork, dairy, poultry and other products. We asked our farmers to specialize in order to become competitive and they took up the challenge. To meet this challenge, they must have a decent income and know how much they can expect to receive in 1995 and 1996, and not a widely fluctuating income. Supply management offers dairy producers some income stability.

I know that my question will be answered by the hon. member for Prince Edward-Hastings on behalf of the Prime Minister, but I hope that he will take these demands under consideration. I know that the hon. member for Prince Edward-Hastings is very familiar with all agricultural sectors and that he, too, is very sensitive to farmers' concerns. I, for one, can tell you that farmers would never have agreed, in December 1993, had they known that this import tariff agreement would be so fragile.

[Unemployment Insurance Act, February 21st, 1995]

Mr. Speaker, yesterday I was asking the Minister of Agriculture about agricultural subsidies, and, more specifically those allocated to grain transportation in western Canada. On the eve of the budget, my concern was to try to find out a little more about the intentions of the minister, who wants to review all agricultural subsidies.

The Minister of Finance ended the suspense this afternoon. The budget will finally be tabled at 4:30 p.m. on Monday, that is, in a week's time. We will then discover the fate of agricultural subsidies. We will discover, finally, whether existing rail carrier subsidies will be replaced by direct subsidies to western grain producers.

So, in answer to my question, the minister gave a rather vague response. He said his colleague in transport and he had been involved in discussions with the primary stakeholders and that the details of the discussions would be made available once the budget was tabled in this House.

The message is clear. We will not have any more information until next week. The minister's response to this, in a minute or two, will be, I expect, a good couple of minutes of fine speech-making, devoid of content. Why do I bother, you might ask, Mr. Speaker? I do so to protest the government's attitude in this matter.

Yesterday, the minister said that Western grain transportation reform had been debated quite often during the past 25 years. As far as I know, his party, the Liberal Party, has been in power for the past 25 years, longer than it deserves, and it never had the guts to take action in this respect. What we have been seeing lately seems to be a rerun of what happened in the past. And that is what bothers me.

Last summer, the Minister of Transport announced that the Crow rate would be abolished. His colleague at Agriculture and Agri-Food hastened to say his department would pick up the slack by making the necessary changes. The committee on payments to producers examined the question and made a number of recommendations, which included transferring the subsidy directly to producers to help them adjust to the new situation.

We expected the minister to let us know whether he supported this approach. Not a word from the minister.

Since that time, it seems the minister has seen talking and consulting quite a lot. That is why I am anxious to hear what kind of measures the minister will implement to make this an effective and satisfactory subsidy for producers, while meeting international trade standards.

There is a risk, however, and this will affect farm producers across the country, that the $566 million paid to Western rail carriers will be paid directly to Western producers only, who will then be able to diversify their operations and, in the process, compete with farm producers in the rest of Canada, which would improve their competitive position.

Imagine, for instance, that with the help of the subsidy, Western producers would be able to raise hogs more cheaply than producers in Quebec or Ontario. This would mean unfair competition with the help of public funds. Can you see farm producers in Quebec and Ontario paying Western farmers to compete unfairly on the hog market? I am using hogs as an example, but it could any kind of livestock that would allow Western farmers to compete with producers in Quebec or Ontario or the Maritimes.