Ian McClelland

[Income Tax Budget Amendments Act, 1996, April 10th, 1997]

Mr. Speaker, as I stand to speak to the budget debate it would be fair to say that I speak for millions of Canadians from coast to coast to coast. If things are so good why do I feel so bad? If things in our economy are so good why do I not have any money?

All Canadians appreciate that for all levels of government, municipal, provincial and federal-and the federal government especially has by far been the most devious-taxation no longer has much to do with income or resources. It has more to do with licensing. If the tax stream coming in from people is based on profit or income it is variable. Governments do not like variable income. They like income that they can depend on. Therefore far less of our taxes have anything to do with how much money we have, how much money we have made or our profit. It has more to do with the privilege of being either in business or having the privilege of earning income.

I use as an example the recent changes to the Canada pension plan, perhaps the most nefarious of the worst investments any individual could make, particularly a young Canadian, with rates going up to 9.9 per cent. The finance minister and the Prime Minister are now the only two Canadians who say they are not taxes. They call them investments. It is a pretty rotten investment that takes 9.9 per cent of the working income of Canadians for their lives and gives them a return on investment of about $9,000 after 40 years.

Canadians have this ever increasing tax burden that is represented to them not as taxes but as licence fees, mandatory investments or whatever it is. It is almost impossible for a politician not to spend other people's money if it means there is a potential for the politician to be re-elected. That is the way it works.

In my lifetime one did not get elected by telling people they had to live within our means or that we did not have any more money. One did not get elected by saying it is unfair to tax future generations of Canadians so that we can live beyond our means today.

What government has ever been elected by looking people in the eye and telling them the truth? Certainly not this government and certainly none of the governments that got our country into this mess.

The reason our country is in the mess it is in today is that politicians have had a free hand to spend other people's money, taxpayers' money, to get re-elected.

How can we get ourselves out of this mess? We must say the only way to possibly reduce taxation levels is to reduce the size, the scope and the intervention of government in our daily lives. If we are not prepared as individuals to assume responsibility for our own lives, if we as individuals pass off responsibility for our lives to other people through governance, then it will take more and more and more resources of the nation to fund it.

The first step is for Canadians to say they have had enough government; they want less government; they are sick and tired of it; and they are not going to take it any more. The only way we will

achieve that is to elect people who will look us in the eye and tell us they must be responsible for lives. We cannot ask others to be responsible for our lives.

Collectively we will be responsible for each other. If we cannot first look after ourselves, how can we look after others? The interdependence we cherish is based on personal independence. If we cannot first be independent, how can we be interdependent?

This brings me to the second item I would like to speak about, which also refers to the taxation by stealth the country has been living under for the last couple of budgets. It has to do with the changes to the support payments for parents who divorce or are separated.

It used to be that when families unfortunately split up the custodial parent, the parent with the children, received money from the non-custodial parent. The paying parent earned a higher income and the taxes were paid by the receiving spouse, usually the female. She had the children. Her income was usually lower than that of the male and therefore she paid less tax.

This situation has been changed in the budget. The taxes will now be paid by the spouse who makes the payments. The money will be received by the custodial parent. There are benefits to that, one of which is that at the end of the year the custodial spouse will not be nailed with an unexpected tax bill. In all cases they should expect it, but the reality is that most of us as human beings do not make provision for it and it comes as a surprise.

That tax windfall, the changes in that tax ruling, will mean the federal government will take in an additional $200 million. The question is whether that $200 million will be turned back directly to the care and maintenance of children and whose children will be maintained by that.

It should be the parents who make the decision on how the $200 million is spent. There is no reason in the world why in the absence of an agreement on separation the taxes could not be split 50:50. There is no reason in the world the default position could not be 50:50. With agreement by both parents in the court either parent could pay the tax. The taxes should be paid in the interests of the children so the majority of the money would stay with the children. Instead we have gone from all in one direction to all in another direction, which does not make sense.

In the debate on the bill that spoke to the issue the point was made that there was no connection between access, custody and support payments. The only people who would make that assertion are people who do not know anything about it. If there is a problem in maintenance payments, in the regularity of the payments being made, obviously there will be a problem with custody. That is usually where the problems arise when there are problems. I do not know if it is possible for legislatures to legislate common sense. In times when people's emotions are running on high it is difficult for the government to say: "Wait a minute. You have to put the interests of your children first".

We can ensure the laws, the rules and the regulations we enact enure to the benefit of the children and make it less likely that there would be an explosive situation to be dealt with. It seems that maintenance payments are a tinderbox in relationships that have gone bad and that there is a continuing acrimony between the two parents. There might be a better way to handle the matter. I do not know what we have arrived at will achieve what it is hoped to achieve.

Earlier the member opposite spoke about RRSPs and the changes in the budget which affect the collapsing of RRSPs. He did not say that it is the compounding of the money in the RRSP in a tax protected state that brings additional benefit to the people who own the RRSPs. RRSPs are the vehicle of savings for the vast majority of Canadians.

The vast majority of Canadians really do not have any savings outside of their RRSPs because there just is not that money. The increase in taxation by all levels of government, particularly by the federal government over the last few years, has sapped the total growth in the economy. When governments through taxation suck every bit of growth and money out of the economy then what is left to reinvest to create the new jobs?

It is only through the decrease in taxation by all levels of government, particularly the federal government, that there will be money left in the hands of taxpayers that will be used as investments and purchases in a consumer economy.

The changes through the seniors benefit were not mentioned at all. We are talking now about taxation by stealth. For the information of members opposite, there is a change to the old age security and the guaranteed income supplement. The seniors benefit which combines both ensures on a universal basis that all Canadians will receive $11,420 a year without tax but then the tax provisions that used to be on the guaranteed income supplement will be on the whole kit and caboodle. Old age security will be taxed by this government, which has said time and time again "don't worry, seniors, we are your protectors, nothing is going to happen". It combined the two, changed the name and it is taxing it all back.

That means that all pension income, including RRSPs, will be taxed back at 50 per cent on the first $12,500 after the new seniors benefit.

[Petitions, April 10th, 1997]

Mr. Speaker, the third petition follows the one presented by my colleague from Athabasca. It has to do with the murder of a woman by her husband and then allowing the husband who committed the act to claim provocation. This is patently unjust. It does not make sense. It speaks against the notion of fairness.

This petition, signed by over 300 residents primarily of my constituency, asks that the government review and change that law so that persons who attack and kill their spouses are not able to claim provocation as a justified defence.

[Petitions, April 10th, 1997]

Mr. Speaker, the second petition states that children have a moral right to be loved and nurtured by both parents and by members of both extended families.

Consequently, the relevant and legal rights and obligations should be fundamentally the same for both parents before and after separation or divorce.

[Petitions, April 10th, 1997]

Mr. Speaker, it is my honour to present three petitions. The first petition begs the Government of Canada to upgrade its highway system and spend more money on the repair and maintenance of highways.

[The Budget, March 18th, 1997]

Mr. Speaker, my colleague opposite makes a good point. The problem is that the federal government is the one that sets the standards. The federal government is the order of government which built the expectations in the population of Canada. Provincial governments are responsible for delivering the programs for which expectations were determined by the federal government. When there is one order of government responsible for raising the money and the other order of government responsible for delivering the programs, there will automatically be situations where people are pointing fingers, one at the other, saying it is your responsibility.

It seems to me that whoever raises the money and pays the bulk of the money should be setting the standards.

My colleague opposite also pointed out that businesses create wealth. I do not have any problem with that. However, it seems to me that it would be far more efficient to provide for entrepreneurs to make a profit and retain it and get a capital pool for their investment. When any order of government uses taxpayer money to subsidize another business, it is artificially stimulating or changing the business environment in a particular area. The reason businesses take up government programs is they are there. If one business makes use of a government program and another does not, then the business that takes the government largess has an advantage. It does not create employment, it just creates more and more taxation.

I raise the example of someone working for $7 or $8 an hour and paying taxes to the federal government. That money working its way back into the business environment, subsidizing someone else to go into competition with the people who paid the money in the first place just plain does not make sense.

If we allowed entrepreneurs to retain a return on the investment that would create an entrepreneurial environment so that people could make more money from entrepreneurial activity rather than a passive return on investment on interest income, we would see a whole lot more entrepreneurial activity, a whole lot more job creation and it would be extremely cost effective.

[The Budget, March 18th, 1997]

Mr. Speaker, it is a real pleasure to participate in this extremely important debate.

Being a budget debate, it gives us the opportunity to have a fairly wide ranging discourse about the affairs of the country. It gave me an opportunity in preparation for this discourse to consider some of the reasons that brought me into politics in the first place.

I am sure that my reasons were really not very much different than the reasons of my colleagues opposite or those with whom I share this side of the floor. Most of us are here because we want to make our country and perhaps even in a greater sense the world a better place for our children and for our grandchildren.

My motives are not necessarily any more pure or pristine than the motives of my colleague opposite. It is clear that I would prefer that we addressed our problems in a much more forthright manner than members opposite.

I am reminded of the words of Ayn Rand. These words help me very much in my life and I have tried to share them with people

whenever I can: "You must deal with problems as they are, not as you would wish them to be".

It seems to me that all too often we in politics tend to deal with problems not as they are but as we wish them to be or, worse, given a particular situation, we will try however we must to justify the status quo. If we have made a mistake, rather than fix the mistake we will somehow try to make it right without addressing the core problems.

In politics, the higher a person is on the food chain, the less likely it is that any utterings of that person will be seriously challenged by anyone in this place.

In "The Rights of Man" Thomas Paine wrote that each generation has the right and the responsibility to govern for its times. The greatest insolence and tyranny of all is the presumption of ruling from beyond the grave.

Particularly to young Canadians who might be watching this debate, how does this enter into the budget debate? What do the words of Thomas Paine have to do with our budget debate over 100 years later? Why are his words germane?

They are germane today just as they were then for this reason. If we in our generation and in the generation that preceded us saddle our children and our grandchildren and their children with a debt that is not of their making, then we are ruling from beyond the grave. When we are no longer of this world, what we have done will be paid for by our children and by our grandchildren.

I am sure I speak for many parliamentarians here and in provincial legislatures across the land. When I wrestle with the problems that we have of debt, we must do so bearing in mind that we have a sacred obligation to future generations to leave our country and our world in better shape than we found it in.

That is what brought me into politics and I would expect that is what brought a lot of my colleagues into politics. Some of us choose to achieve these goals by different avenues. That does not make them necessarily right or necessarily wrong. However, it does suggest that there are different priorities attached by different political parties.

The Liberals came into this thinking that if we are able to change the name and move things around a little and fudge it we will not really have to address the core problems facing our country. The core problem facing our country has not been revenue. Being the most highly taxed of the G-7 countries, of any industrialized nation in the world, revenues are not a problem. As a matter of fact, in the government's revenue documents, the budget documents, it clearly makes the point that government revenues are going to increase from the 1994-95 fiscal year to the 1998-99 fiscal year by $20 billion.

That is virtually the entire growth of the gross domestic product of the country. What is happening is that the lifeblood of the country is being sucked out of the pockets of individual Canadians. We do not have a revenue problem, we have a spending problem.

Over the same period of time again from the government's own documents it shows that government spending will decrease $15 billion but fully $7.5 billion of that government spending decrease will be part of the Canada health and social transfer.

So then what are the components of the Canada health and social transfer? They are transfers to the provinces with respect to payments for health, post-secondary education and welfare. Where are the provinces under most stress in their budgets? Health, post-secondary education and welfare.

The federal government has changed the name of the departments, combined them into a global budget and then said it will reduce transfers by $7.5 billion. That $7.5 billion represents a decrease from $19.3 billion to $11.8 billion.

I do not know what the percentage is and I apologize, I should have figured it out, but it is pretty dramatic. The provincial governments have had to make up and take up the slack.

It is a little difficult for the provincial governments to do so because in order to be eligible for the transfers from the federal government for these programs the provincial governments must abide by rules established by the federal government.

Here we have the situation where the federal government is making the rules but the provincial governments have to pay for it. It does not seem right to me. It does not seem right to me not that the government does not have the responsibility to get its finances in order but how can it in good faith and good conscience slough off the responsibilities to other governments and call this doing the job?

At the same time that the government is reducing transfers to the provinces in support of health, education and welfare it has all kinds of resources to subsidize business such as Bombardier, such as a hotel in the Prime Minister's riding for millions of dollars, to business all over the country with the notable exception of the west. How can we find money to subsidize business but we cannot find money to transfer to the provinces for health, post-secondary education and welfare?

It seems to me that the government is speaking out of both sides of its mouth when it says that its concern is for post-secondary education, understanding that the future of young Canadians is built on knowledge and at the same time it cuts transfers to post-secondary education.

I invite my colleagues opposite to stand and perhaps we will have an opportunity to explore some of these issues.

[The Budget, March 18th, 1997]

Mr. Speaker, there does not appear to be a quorum in the House.

[The Budget, March 18th, 1997]

Mr. Speaker, I listened with interest and incredulity to the hon. member who just finished speaking, particularly when he was defending the Canada pension plan in the context of his own experience as an employer. I found it passing strange that anyone who has ever signed a pay cheque would not consider payroll deductions as being a tax.

As everyone knows, employers do not have an option on payroll deductions such as employment insurance or the Canada pension plan. They are mandatory deductions which by law must be paid to the government.

Government documents, including the human resources employment insurance recently issued, refer to payroll deductions as taxes. The finance minister has referred to payroll taxes as a cancer on job creation.

What is the number one problem in our country? Job creation. Who are the most affected in our country as far as finding jobs is concerned? Young males. Who is the most hurt by this? Young males. Who are the last hired and first fired? Young males entering the workforce.

The tragedy of the Canada pension plan is that the government was the opportunity to fix it, not tinker with it, It has been described accurately as a giant Ponzi plan.

I ask the member opposite to pay close attention. Government documents indicate that persons who retired in 1976 contributed to the Canada pension plan $2,521. Their benefits would have been $29,000. They would have had a return 11 times the size of their contribution. Someone retiring in the year 2030, who will be our children, and in the year 2031, will contribute $472,000 to get back $266,000 for a return on their investment of just about half.

Perhaps the hon. member opposite would justify that not to his contemporaries but to his children and his grandchildren who are paying the freight for the retirement plan for seniors and for the debt we leave them.

[The Budget, March 18th, 1997]

Madam Speaker, the member opposite from Fredericton and I have served on committees together. Particularly we served on the committee for human rights and persons with disabilities. That committee worked in a non-partisan way on many worthwhile subjects, one of which addressed the very real concerns of persons with disabilities.

Persons with disabilities could be put into two separate groups. Although some persons with disabilities do not want to be put into two distinct groups, the fact remains that there are two groups. There are those Canadians who through accident, through birth or through other circumstances find themselves in absolute need of society's help on a daily basis to have, as the member opposite mentioned, the potential of equality of opportunity. There are those who have become disabled over the course of their lives and whose disabilities are very real but have come about as the result of aging or living. That is the distinction between the two disabilities.

When the Canada health and social transfer was first instituted persons with disabilities fell through the cracks. Most people acknowledge that happened.

Has the government considered a specific program whereby persons disabled for life will be held harmless from the cost of their disability both through proactive financial support and through the removal of the catch 22 where disabled people, who make the extra valiant effort to be gainfully employed, find that they lose the very benefits allowed them to get employment in the first place? Has that been and will that be addressed?

[Somalia Inquiry, March 13th, 1997]

Mr. Speaker, that is exactly what we are talking about and that is exactly why we have a Somalia inquiry in the first place.

I have one question for the minister of defence. If a Canadian had been beaten to death on March 16 instead of a Somali, would the minister of defence be shutting down the inquiry?