House of Commons photoWon his last election, in 1993, with 42% of the vote.
The Budget February 24th, 1994
Madam Speaker, I will be very brief in commenting on the wonderful reiteration of the ways in which this government is preserving this wonderful country which is going down the drain because we are facing a financial crisis. One hundred billion dollars more added to the debt in three years. It alone will add $6 billion to the current deficit. I do not understand how this can continue.
The Budget February 24th, 1994
I thank my hon. colleague for his comments. They are clearly partisan. This is what divides people. I look forward to seeing how many letters he will get from the people who have been singled out to make sacrifices so that other people can get benefits. I find that the kinds of programs initiated by his government are not popular with my constituents.
The Budget February 24th, 1994
Madam Speaker, the Government of Canada is like a person who has a weight problem. Overspending is like overeating. The deficit is like the fat that stores the excess calories consumed. The dangers for Canada are the same as for the overweight person.
Ultimately the fat will clog the arteries and some vital functions will fail.
Like those with weight problems our government always makes resolutions to do something about the problem: just enough calories today to sustain the fat and a more serious diet next week.
The excuses for procrastination are always the same. We need the calories to sustain the living tissue otherwise there will be pain: unemployment. Another excuse is that we are about to discover a method for losing weight without pain: an infrastructure spending program, some grand redesign of social programs, more efficient government operations or the closing of tax loopholes.
This budget has put the patient on a diet which slows the rate of growth of the debt. It does nothing to stop the debt from growing. Certainly there is no indication that we can ever expect a slimming of the debt. Promises for a more restrictive diet following the redesign of social programs are no longer believable. There are no painless ways of losing weight. No studies will uncover them.
More important, it makes no sense to keep on saying that all slimming procedures are health threatening. Canada had full employment and rapid economic growth when budgets were balanced. The restoration of balanced budgets really restore these favourable conditions, just like people feel healthier and more vigorous who have dieted successfully and have returned to their normal weight.
The cure for Canada's disease is known. It needs to be applied soon or the patient will be seriously ill. All it takes is to say no to additional helpings of food. We need to cut spending drastically. During the election campaign the bulk of people I had contact with were concerned about the size of the deficit and debt and wanted dramatic action to reduce it. They believed that the overweight person, the Government of Canada, must be made to slim down to where there is no more fat. They believed that a crash diet was worth the pain in the knowledge that health would be restored.
My constituents put one important condition on their willingness to make sacrifices for the sake of the country's fiscal health: the pain must be shared by all Canadians. Our basic system of public health care and pensions must be preserved. Social spending programs must be restructured to serve only those in need. The budget does not share the burden.
The people in the defence industries, civil servants, elderly taxpayers, business, entrepreneurs with capital gains and the recipients of UIC have been singled out. Worse, these Canadians are asked to make sacrifices while excess spending is maintained. There are 18 new spending programs which in the aggregate match the cuts. These new programs are motivated by the desire to pursue ideological goals stemming from the liberal world view about the ability of government to solve all problems of society.
There is the promise to increase the number of day care spaces once economic growth has reached 3 per cent. The forecast is for such a growth rate during the next two years. What will this promise cost? The budget is silent on this potentially very expensive program.
There is much known fat in current government spending programs. No studies are needed to identify it. It could have been cut to reduce the deficit significantly while resulting in much more equitable sharing of the burden.
First, there is the unemployment insurance system. The proposed changes in eligibility requirements are a step in the right direction but they are not enough. By most international and our own historic standards the benefit rate of 55 per cent for single persons is too high. Lowering it by two percentage points is symbolic rather than economically effective, especially when at the same time the benefits to others are raised to 60 per cent.
Second, old age security benefit payments are slated to rise 7.5 per cent from the current $20 billion in two years, primarily because there are more eligible Canadians and because of the indexing of the benefits. Yet, it is well known that a very substantial part of OAS payments are going to families with high incomes. It was never the intent of the program for families in the top decile and earning $100,000 to receive annually over $2.5 billion under this program while they are retired, without family obligations and fully insured against health care expenditures.
Third, the most rapidly growing expenditure category is grants to Indians and Inuit. It is slated to rise a full 17 per cent in two years. Many people who have been asked to make sacrifices are wondering why spending in this program is slated to increase $300 million every year for the next two years.
More generally this budget claims to make savings of $8 billion in two years. It should be noted that these savings are relative to spending levels slated to increase according to the budgets made a number of years ago. Half of them are due to what is called securing savings from previous budgets which requires no measure of political courage. In effect all the so-called savings amount to nothing more than the reduction of previously announced spending increases.
The bottom line for Canadians is that the level of program spending is slated to remain unchanged at $122 billion during the next two years. This is not the kind of diet the overweight patient needs.
There is legitimate reason to be sceptical about the realism of the projected size of the public debt charges. They are slated to rise only $3 billion over the next three years. The expected deficits of this period are about $100 billion. The interest on this additional debt alone is $6 billion. Therefore the government
must expect to enjoy large savings of $3 billion on debt service charges on the already existing debt of $504 billion.
This is a very risky forecast. Economic growth is predicted to be 3 per cent and 3.8 per cent in the next two years. This will create inflationary pressures which will be compounded by the delayed effects of the depreciation of the Canadian dollar during the last year.
The forecast of the inflation rate of 1.3 per cent for 1995 is very low and so is the related forecast for interest rates of only 6.1 per cent on long term bonds in 1995. Adding to my scepticism about interest rates is that the U.S. economy is booming and rates there have already begun to rise. Canada cannot afford to have a significant gap in favour of U.S. interest rates.
I also have my doubts about the forecast for economic growth in the next couple of years, doubts which are not shared by the majority of economists. I believe the main reason consumers are reluctant to spend and therefore are extending the recession is that they are worried about the country's deficits and debt. They worry whether they will experience the collapse of government services and entitlements suffered by the people of New Zealand.
Until they are sure that our government has taken courageous steps to reduce the deficit, they will continue to spend cautiously. As a result, economic growth may well remain more sluggish than has been forecast in the budget.
Let me close by noting that the international capital markets are giving the government breathing space for this budget, however disappointing are the figures on the level of spending cuts. Several people in close contact with the financial community have told me that we may expect serious capital flight and a financial crisis unless the announced redesign of the social programs this fall produce significant savings.
I therefore urge the government to make the redesign of the social services a serious effort. If there are no tough decisions made and credible savings generated, Canada may find itself in the same position as did the country's largest real estate empire.
Rumours and predictions about a financial crisis were denied and banks kept on extending credit until suddenly and upon one extra slight provocation the crisis started and the entire empire began to collapse. The diet was too late and too little.
Let us hope that Canada will not face the same problems. The decision is in the hands of the government.
Privilege February 22nd, 1994
Mr. Speaker, I rise on a question of privilege concerning some comments made during question period.
I feel my personal integrity and credibility have been attacked. During my question I said that I was an immigrant and that now I was a Canadian citizen. The member for Carleton-Gloucester shouted: "Now you want to lock the gate".
This was neither the point of my question nor do I recommend-
Immigration February 22nd, 1994
Mr. Speaker, may the people of Canada conclude from the minister's answer, or non-answer, that decisions about Canada's immigration levels are made without regard to the costs which the policies impose on the already strained social programs of the country?
Immigration February 22nd, 1994
This question is in the name of Canadians concerned about the country's financial crisis. Next year Canada will admit 111,000 family reunification immigrants. Many of them will be persons of an age where they will be unable to contribute to Canada's social programs. These individuals are entitled to free medicare.
Would the minister please tell the House what he expects the cost of the medicare services required by these immigrants will be?
Immigration February 22nd, 1994
Mr. Speaker, my question is for the Minister of Citizenship and Immigration. I was an immigrant and I am now a citizen of Canada.
The Budget February 15th, 1994
I wonder whether the minister could tell the House the number of man years and woman years of work that will be created by the very capital intensive infrastructure program and how many man years and woman years of work will be lost by the lower spending in the very labour intensive restaurant sector.
The Budget February 15th, 1994
Mr. Speaker, I will try to be politically correct.
The Budget February 15th, 1994
Mr. Speaker, I refer to a statement made right here that this would be something that the minister would do in the budget.
I have a supplementary question. Could the minister please inform the House on the number of manyears of work that will be created by the very capital intensive infrastructure program and how many manyears-