Mr. Speaker, I am pleased to rise at this stage of consideration of Bill C-3, which was tabled by the government to renew the equalization payments program. This bill is yet another proof of the inefficiency and inequity of the federal system for the provinces, and particularly for Quebec.
In principle, this program is basically designed to reduce financial disparities between the provinces. It is more than time to see if this objective has been reached. In the case of Quebec, our province is still penalized, in the long term, by such a redistribution of revenue. Of course, some will say that Quebec receives more than its share of federal transfers, but let us not forget the historical causes which put our province in this uncomfortable situation.
Indeed, is it not strange that, since the implementation of equalization programs, the money given to Ontario was intended to cover structural expenditures such as investments in research and development, or infrastructure expenditures which have promoted a stable economic development for that province?
All these measures have weakened Quebec's position and, to this day, even if our province's contribution still accounts for more than 23 per cent of Canadian wealth, it never gets its fair share when the federal government decides to distribute monies
for structural investments. The statistics are quite eloquent in that regard, and I want to mention a few.
Between 1979 and 1989, Quebec's share of research and development was 18.5 per cent, while Ontario's was 50.1 per cent. Again, let us not forget that Quebec's contribution accounted for 23 per cent of Canada's wealth.
As far as federal investment is concerned, in recent years Quebec's share has been 15.4 per cent, with the remainder allocated outside Quebec. When we consider the value of infrastructures in the defence sector, the figures become even more revealing and damning, with Quebec receiving only 13 per cent of investments in this sector, compared with 25.8 per cent in Ontario, 34 per cent in the West and 27 per cent in the Maritimes.
While we are on the subject of infrastructure, there is also the St. Lawrence Seaway which goes back at least 30 years, in which although it did provide opportunities for ports in Quebec to expand, also stimulated development of ports in Ontario and especially the development of the automobile industry in Southern Ontario.
Meanwhile, Quebec was allocated funds for unemployment insurance and welfare benefits, symbols of a negative outlook for Quebec's economic development. As we have seen, the difference in fiscal capacity between Ontario and Quebec continues to exist, despite supposedly generous equalization payments to Quebec.
As a result, Quebec has become increasingly dependant on federal transfer payments, because its unemployment situation has always been worse than Ontario's. For decades, unemployment in Quebec has always been from 3 per cent to 5 per cent higher than in Ontario. It was a situation bound to please those who favoured authoritarian federalism.
Bill C-3 provides that the ceiling on equalization payments will not be abolished but extended for a period of five years. However, this measure negates the very principle of equalization by failing to provide for equitable redistribution of Canada's wealth. In a particularly underhanded way, it will actually reduce transfers to the provinces, and Quebec will again be stuck with paying most of the bill.
If the rate of growth of the GNP reaches 5 or 6 per cent a year, as predicted by our very optimistic Minister of Finance, that is under the best possible assumption, Quebec will suffer a loss of $900 million, or 60 per cent of the planned $1.5 billion reduction in transfer payments, solely as a result of freezing the ceiling for the next five years. That is the perverse effect of this bill.
Once more, the federal government is passing the buck in terms of the deficit to the provinces by giving Quebec and other provinces less money while their citizens require the same level of services. It means that they will have to raise taxes.
I can already imagine what the members opposite are going to say. They are going to say loudly that the critics from the Official Opposition are exclusively motivated by crass sovereigntist-if not separatist-intentions, since it seems that last week the Prime Minister learned that the Official Opposition intended to pull Quebec out of the Canadian federation.
Let us come back to Bill C-3. The Quebec minister of finance and Premier Johnson form the most federalist pair imaginable; yet even that minister of finance could not help but make some negative comments on the bill dealing with equalization payments. Naturally, as a good champion of Canadian unity, Minister Bourbeau said that he was generally satisfied with the results of the Federal-Provincial Conference of Finance Ministers held in Montreal last January. However, Minister Bourbeau made some negative comments on this bill. His criticisms take on a very special significance since Mr. Bourbeau is member of a Quebec Liberal Cabinet which was ready, as we saw with the Charlottetown Accord, to accept any shady deal to save a semblance of Canadian unity.
So, that was what the Quebec minister of finance told us in a press release dated January 21. We can consider that that declaration is still in order today. The minister said, and I quote: "However, I have a hard time accepting that the federal government decided to maintain the ceiling on equalization payments". If the Quebec minister of finance, who is definitely a federalist, declares that that decision is hard to swallow, that means it is simply ridiculous and unacceptable to the population of Quebec.
With this ceiling, we are moving away from the aim inscribed in the Constitution, which is to give provinces enough revenues to be able to provide quality public services based on more or less comparable taxation systems from one province to another.
It is always surprising to hear a Quebec minister, and a keen partisan of federalist orthodoxy, declaring himself satisfied with a provision that moves away from one of the major aims of the Canadian Constitution. But the contradiction did not end there, and the Quebec finance minister, as we saw recently, will not let a contradiction stop him.
Indeed, the minister went on to say in the same release: "Property taxes are the second largest source of revenue used to calculate equalization payments, and Quebec's fiscal capacity in that area is clearly overestimated, which results in a serious shortfall in that regard. For the Quebec government, the fact that
we have to wait for five years before this standard of fiscal capacity is significantly improved is hard to swallow".
How can anybody claim to be pleased with a measure that is so detrimental to him? The answer is quite simple and is matter of common sense. Everybody knows the perfectly legitimate position of the Quebec finance minister and his government on the preservation of federal ties. Everybody knows as well that a general election is looming in Quebec and the provincial government has nothing to gain from a confrontation with a newly elected federal government, and a Liberal one at that.
Not too many people are pleased with Bill C-3. One positive proof that sovereignists are not the only ones to condemn the ceiling on equalization payments is the declaration of the Manitoba deputy minister of finance, Mr. Newman, who recently said to the Standing Committee on Finance, right here in Ottawa:
"The proposed ceiling on equalization payments violates the spirit and intent of the Constitution. Continued application of the ceiling is unwarranted and detrimental to Canadians living in the less affluent provinces".
If you combine the principle of transfer payments to provinces with the various discretionary powers of the federal government, as is the case presently, you get a result which is particularly bad for Quebec.
Let us see what happens: first, in order to finance programs which, in many instances, are of provincial jurisdiction, the federal government levies taxes on Canadian and Quebec taxpayers. Then that same federal government creates supposedly national standards which everyone from coast to coast must observe. This is pure and simple interference in provincial affairs, and such interference is especially unacceptable, even indecent, when the federal government reduces its own contribution to programs while maintaining national standards that provinces must keep on respecting.
In other words, the federal government is asking the provinces to maintain the same level of services while giving them less money to do so. That is exactly what happened in Quebec in the health and post-secondary education sectors, which are still exclusively provincial jurisdictions, according to the Constitution of Canada. Between 1977 and 1993, the federal government's share for the provision of these two programs was cut from 47 to 34 per cent of total costs.
Then this same federal government told Quebec that it was going to keep on taxing the province more and more, as shown in the finance minister's recent budget speech, to fund both these programs. But it was going to give Quebec less money to provide services to its people. If you call such transfer payments fair, I do not know what fairness is!
In the health care area, while the federal government was continuously decreasing its share of contributions, it compelled the provinces to abide by health standards it had set. Quebec is not getting greater control over its health care system, it is getting the power to cut without being able to decide where to cut. Another one of the great inequities of the present system of transfer payments to the provinces can be found in established programs financing, under which the federal government comes and takes money from Quebecers to implement national programs according to Canadian standards, even though they do not always fit the Quebec reality.
The distinct society is much more than a hollow formula which emerged one day out of a lake that was the scene of a so-called constitutional agreement-the distinct society is, for believers, and we are among those, much more than that; it means also that Quebecers are a nation and that their specificity is rooted in a very real social and political situation.
A nation draws its sense of identity from the values shared by its people. Its programs and infrastructures should be based on these values, which should also be reflected in government programs which will determine people's standard of living. Quebecers have come to identify less and less with the standards imposed on them by the federal government. For its part, the government still refuses to recognize Quebecers' distinctiveness.
Let me give one example which the Minister of Health herself used in this House a while ago. I am talking about the network of local community service centres, or CLSCs, which Quebec established without the help or advice of the federal government. This network was set up in the early 1970s and the minister cited it as a model for service delivery. This mechanism which allows Quebecers to benefit from health care and social services right in their own community was fully developed and funded by Quebecers.
The Bloc Quebecois advocates radical changes to improve federal transfer programs to the provinces. By carrying out small sectoral program reforms, the federal government is manipulating the figures and pushing through changes which are not in the best interest of the provinces. As we have seen with the recent budget, the budget which is now before us, on the one hand, the government is slashing $2 billion from established programs financing in the area of post-secondary education and the Canada Assistance Plan, while on the other hand, it is maintaining the ceiling on equalization payments, despite the resulting inequity that I described earlier. All this just to confuse people and to make believe that the federal transfer payments system has been upgraded, when it is not so.
The Bloc Quebecois is strongly opposed to Bill C-3, which renews-