Lost his last election, in 1997, with 30% of the vote.
Committees Of The House May 31st, 1995
Mr. Speaker, I have the honour to present, in both official languages, the 10th report of the Standing Committee on Human Resources Development, regarding the information under the heading "Human Resources Development" in the main estimates for 1995-96.
The committee reviewed the main estimates and submits its report without amendment.
Tourism May 30th, 1995
Mr. Speaker, I rise today to congratulate the Nova Scotia government for showing strong leadership in the area of tourism development across the province and in particular on Cape Breton Island.
For the past 37 years the people of Cape Breton have been patiently waiting for the development of an infrastructure system worthy of its international tourist destinations, including the beautiful Cabot Trail, salmon fishing on the Margaree and Canada's best kept secret, the magnificent Fortress of Louisbourg.
Tourism is an $834 million industry accounting for over 35,000 jobs across Nova Scotia. On Cape Breton Island this translates into almost 7,000 jobs and $177 million in revenues. The potential for growth here is almost unlimited as new markets are sought.
For a region that has been devastated by a downturn in the fisheries and a 24 per cent unemployment rate, the completion of the Fleur-de-lis highway is more than just about a tourist trail. It is the completion of a transportation system that offers hope, survival and vital long term economic growth to coastal communities which would otherwise disappear. It is a road that paves the way to a self-sufficient and proud future.
As the member for Cape Breton Highlands-Canso I say congratulations to the Nova Scotia government. I invite all Canadians to come to Cape Breton this summer for a vacation to remember for a lifetime.
Atlantic Fishery May 12th, 1995
Mr. Speaker, my question is for the Minister of Fisheries and Oceans.
Yesterday the leader of the third party was in Atlantic Canada spreading doom. I quote: "All you can do is say it's over, particularly in Newfoundland. It's best to take 15 seconds and say the fishery is finished."
Is this true? Are Atlantic fishermen holding onto false hopes, as the leader of the Reform Party has stated? Can the minister give this House a true assessment of the Atlantic fishery?
Income Tax Act May 5th, 1995
Can I go to my motion?
Income Tax Act May 5th, 1995
Mr. Speaker, I appreciate the opportunity to participate in debate on the legislation.
Bill C-70, an act to amend the Income Tax Act, seeks to implement a number of measures introduced in the 1994 budget, along with certain measures announced by the government at other times over the last year.
In asking for the support of colleagues in the House I would be remiss if I did not remind them of the context of the legislation.
The fiscal challenge facing the country has been a topic of considerable debate both in the House and across the country. Few dispute the scope of the challenge. Few dispute the difficult choices that must be made. Few dispute that we must act decisively. Few dispute that fairness and effectiveness must be essential guiding principles of any and all steps taken to overcome our deficit challenge. These principles have guided the government as it has worked to restrain spending. They guided the minister in crafting the budget presented in February.
For the moment and for the discussion of the legislation let me take hon. members back to the budget last year. Spending cuts alone could not deliver the deficit reductions set out at that time. Spending constraint had to be complemented with some measures on the tax side. Doing so was simply a question of fairness. Our vision of fairness guided us as we looked at the tax system addressing unsustainable tax preferences instead of imposing general tax hikes on Canadian taxpayers.
In looking at the corporate tax regime we sought to ensure that corporations paid their fair share of the tax revenues needed to fund government programs and to prevent certain businesses or sectors from taking undue advantage of certain tax provisions.
With this in mind, the budget last year proposed a number of measures for the rules governing the taxation of business income. Let me stress that our goal was not to penalize the business sector or to impede the competitiveness of Canadian corporations. We believe it is essential to maintain a competi-
tive tax system in today's global economy. We cannot disregard the role of business in creating and sustaining employment. Nor can we ignore the pressures faced by Canadian companies as they operate in fiercely competitive markets both at home and around the world.
One fairness issue the budget addressed was the tax rules dealing with debt forgiveness and foreclosures. Under the old provisions of the Income Tax Act many transactions involving the settlement of debt were not recognized in any meaningful way for income tax purposes.
The new rules provide a comprehensive basis to deal with debt settlement. In general they provide that forgiven debt amounts will be applied to losses carried forward and expenses, or partially included in the debtor's income. I should point out, however, that there are special relieving rules to minimize undue hardship from these new rules.
Let me turn now to the tax treatment of securities held by financial institutions. Until now the Income Tax Act was not providing specific rules regarding the tax treatment of such securities.
The measures proposed in the bill seek to reduce uncertainty in this regard and to ensure the income derived from such securities is measured appropriately. The amendments provide that certain securities will be marked to market, meaning that the appreciation or depreciation in their value each year must be recognized in that year.
In keeping with our goal of fairness the amendments include a transitional rule that allows increases in income resulting from the new rules to be spread over five years. These new measures are generally effective after February 21, 1994.
In addition, new rules are provided for debt securities that are not required to be marked to market. These rules deal with the measurement of income while the securities are held and the treatment of gains and losses on disposition.
Bill C-70 also amends the rules for the taxation of resident shareholders of foreign affiliates. This action is being taken as a result of the government's ongoing monitoring of developments in the area. The changes expand the categories of income of foreign affiliates that must be reported as income of the Canadian affiliates.
Another modification prevents the use of an affiliate's foreign active business losses to reduce Canadian shareholders' income. This change also protects the Canadian tax base. The amendments are generally effective for taxation years commencing after 1994.
Finally let me turn to six tax measures announced during the months after the 1994 budget. The bill addresses the issue of eligible prepaid funeral and cemetery arrangements. Under the legislation individuals making such arrangements would not have to declare interest on deposits up to a $15,000 maximum contribution as income, provided the deposit is not withdrawn for other purposes. The provider of eligible funeral and cemetery arrangements is however required to include in income the total amount received from an eligible arrangement.
Turning to the next measure, the bill proposes that real estate trusts with publicly traded units be allowed to qualify as mutual fund trusts. The measure responds to representations from the real estate sector which is interested in expanding the available methods of financing real estate. We believe the proposed change will facilitate the restructuring and refinancing of the sector.
The third of the post-budget measures is a measure that will help mutual funds reduce overhead costs and improve services to investors. The amendments allow mutual fund corporations to convert to mutual fund trusts on a tax free basis and allow tax free mergers of mutual fund trusts.
The bill proposes new rules to speed the resolution of objections and appeals particularly by large corporations. Large corporations will now have to specify the issues under dispute, the amount of relief sought, and the facts and reasons for objecting.
The rules also limit the ability of large corporations to raise new issues in a notice of objection where the objection relates to the reconsideration of an assessment. However new issues raised by Revenue Canada on such reconsiderations may still give rise to notices of objection.
In addition, the legislation will ensure that the new requirements relating to notices of objection will not apply to assessments which were repealed through court before the legislation received royal assent.
The final measure I want to highlight deals with the tax treatment of dividend compensation payments and other incomes connected with securities lending. The Income Tax Act currently provides that the lender of securities not be treated as having disposed of the security under these arrangements. As well, payments to the lender as compensation for dividends are treated as dividends in the lender's hands. While these dividend compensation payments are generally not tax deductible, a special rule established in 1989 allows securities dealers to deduct two thirds of such payments.
This legislation extends the use of the two-thirds rule, thus ensuring our security industries remain competitive.
Supply May 2nd, 1995
Mr. Speaker, I listened carefully to what the member for Mercier and her colleagues said a little while ago. I always find it difficult to understand the Bloc's logic, and today is no exception.
The Bloc is always seeking a little bit more autonomy for Quebec regarding federal expenditures. The budget gives greater autonomy and flexibility in transfer payments, and the Bloc sees in this flexibility less autonomy and more centralization. It wants to hold a referendum to separate Quebec from Canada, but now that it believes that it might lose it because, increasingly, Quebecers are saying, through polls, other media and forums, that they are not interested in the proposed separation, it is starting to realize that the referendum it decided to hold is doomed; it wants to blame the federal government for the fact that it is going to lose the referendum.
The hon. member mentioned the need to get our financial houses in order, not only at the federal level whose expenditures are, for the main part, transferred directly to the provinces, including Quebec, through equalization, social transfers and other mechanisms offering more and more freedom to the provinces. We are looking for ways to co-operate with the provinces and with Quebec, but we are accused of always trying to centralize. It is impossible to co-operate with someone who does not want to.
My question to the member is in connection with the motion before us today: How does the social transfer give less freedom to Quebec to manage its own finances within this envelope? What are the new conditions set by the Canadian government in this envelope?
Committees Of The House March 23rd, 1995
Madam Speaker, I have the honour to present the second report of the Standing Committee on Human Resources Development concerning Bill C-77, which was adopted with amendments.
The Budget March 1st, 1995
Mr. Speaker, I beg to differ with the hon. member. We cannot start eliminating the debt until we start to get the deficit down. That is what the government is doing.
Does the hon. member actually believe that by slashing social programs in one fell swoop the deficit will be eliminated faster?
The Budget March 1st, 1995
Mr. Speaker, I would like to thank my hon. colleague for his questions.
Firstly, many jobs have in fact been created since the government has been in office, more than 433,000 jobs have been created. These jobs were created thanks to the confidence the government has inspired across Canada, especially in the private sector, and the budget brought down by the finance minister on Monday evening will increase the confidence felt by the private sector, the business community, because the government is taking the necessary measures to tackle Canada's deficit directly, thereby creating jobs and lowering Canada's unemployment rate.
The targets the government has set its sights on are necessary to stabilize public finances and create jobs. We can see the effects already in the falling unemployment rate. Our program's objective is to create jobs.
Among the reforms suggested, we will have the opportunity to work on those relating to unemployment insurance. The new Canadian social transfer will allow the government of Canada, in conjunction with the provinces, to create a new social security net with a greater emphasis on employability.
To repeat, we are laying the foundations necessary for a strong Canadian economy which will result in new jobs being created throughout the country.
That is the government's strategy. We have forged ahead with it, it is working and it will continue to work.
The Budget March 1st, 1995
Mr. Speaker, the member for Saint John wondered where the 31 other Atlantic members were to speak on this budget. I am one of those members and I am proud to support this budget.
It is a very fair budget. It is a budget that responds to the needs of Canada, including Atlantic Canada. It is a budget that will build a strong foundation for future growth in Atlantic Canada and it is the budget that does what nine years of Tory government failed to do, which is the reason why it only has one member from Atlantic Canada in the House of Commons and only one other member in the House of Commons.
I welcome the opportunity to speak on the budget that was tabled on Monday. My remarks will come from two perspectives, as my experience as chair of the House of Commons committee which recently carried out extensive public hearings across Canada on the future of Canada's social programs and as an Atlantic Canadian.
For many, perhaps most of the hundreds of Canadians who appeared before our committee last fall, this budget and what would happen to social programs and to the historic federal commitment to social programs as a result of the growing preoccupation with the deficit was very much on their minds.
Many witnesses expressed suspicion that the comprehensive review of the social security system in Canada which they acknowledged was necessary was nevertheless being used as a smoke screen to slash spending on social programs as a way for the government to achieve its deficit targets.
They wondered about the choice of programs that were being included in this review. Why was the government not focusing more on tax expenditures, in particular about tax breaks to wealthy Canadians and corporations? Should they not be made to shoulder their fair share of the task of deficit reduction?
The report of the human resources development committee which I tabled in this House on February 6 paid careful attention to these concerns and had some specific recommendations for the Minister of Finance to consider as he prepared his budget.
In particular, we urged him to ensure that the balance of deficit reduction measures in his budget addressed the issue of tax fairness in Canada. As well, we urged the government to proceed with the reform of social programs as part of its jobs and growth agenda.
The country's difficult fiscal situation only makes the need to address the accumulated problems which have occurred in our social security system more and not less urgent. We did not say that there should never be any reduction in social spending in Canada. That would have been unrealistic in the current fiscal climate. What we did say was that savings in this area should be achieved as part of a fundamental, comprehensive reform to the system of social security in Canada.
It is one that would respond to today's social security needs like addressing the pressing problem of child poverty, fostering the kind of life long learning culture that will support employment and assist Canadians to find the kind of well paying jobs that have a future in this country and, most important, by stabilizing the overall finances of the federal government by removing the distortions and the disincentives that have grown up around government programs that have been built with the best of intentions for another era and by focusing the resources and the energies of government to those areas where government is best placed to be effected. In short, by getting government right.
The Government of Canada can provide the leadership and the fiscal framework needed to ensure that the social security system and the programs which Canadians across this country told the committee they were so proud of and were so necessary and so much defined our country would be preserved and enhanced for the future.
Does the budget that was released on Monday respond to the concerns of Canadians as reported by a committee? In large measure I believe it does. The committee urged the government to balance efforts to reduce the deficit with measures to promote tax fairness. This budget does that. For example, there are no increases to general income taxes, yet measures are taken to ensure that taxes that are owed are paid.
The large corporations tax is increased by 12.5 per cent and the existing corporations surtax from 3 to 4 per cent. In addition, banks and other large deposit taking institutions will pay a tax on capital, raising $100 million between now and October 1996.
The budget takes dead aim at the system of family trusts. All tax advantages that flow from the establishment of family trusts will be eliminated. The infamous amendment to the so-called 21-year rule that was introduced by the previous government to allow the wealthy to shelter tax through family trusts will be repealed.
In addition, the budget adopts a specific recommendation of the committee that would open up tax expenditures as well as direct expenditures of government to regular parliamentary scrutiny.
With the budget the government reaffirms its commitment to reform of the social security in Canada not as a reckless exercise in slashing programs but as an orderly and thoughtful process of renewal in full partnership with the provinces and in consultation with Canadians.
This budget makes no immediate cuts to the principle elements of the social safety net. What further spending cuts occur only begin in 1996-97 and then only once a framework for a renewed and reformed unemployment insurance system and the implementation of the Canada social transfer are fully in place. These reductions are less than the reductions that have been made in other areas of government. The social programs will have more room in a government which is more rationalized and where the fiscal part of the government is more organized.
The consolidation of the Canada assistance plan and the established program finance transfers into a uniformed block transfer to the provinces follow in the spirit of the committee's reports which recommended that the Canada assistance plan be made into a block transfer in order to give the provinces more flexibility and in order to design reformed and renewed ways of helping people who are on social assistance provide basic supports for their families, also to enhance their access to the job market.
In addition to that the committee also recommended that there be an enhanced effort toward working with the provinces to enhance the child tax credit, working income supplement and other measures that would be made in order to work together to provide more assistance to poor families with children.
In addition, the redesign of the unemployment insurance program announced with this budget is also something that is absolutely necessary. Our committee recommends ways in which the unemployment insurance program can be redesigned and rebuilt in order to foster employability, in order to promote
lifelong learning, in order to allow Canadians to have access to the supports they need to get the jobs of the future.
As an Atlantic Canadian, particularly one who comes from a region where unemployment insurance and other social programs are a very important part and preoccupation, I know they realize there must be changes to this program in order to help Canadians get into the workforce and to help our people relinquish their dependence that has grown on unemployment insurance.
If we as Atlantic Canadians can participate in a renewed unemployment insurance system or an employment insurance system, which is really what it is all about, we could help to create a better foundation for our economy in Atlantic Canada, creating the kinds of jobs we need to have in order to have a stable future there.