Paul Crête

[Equalization Formula, June 20th, 2007]

Mr. Speaker, the Prime Minister promised Quebec that he would limit federal spending power in Quebec's and the provinces' areas of responsibility. Then the Prime Minister watered down his promise by limiting it to cost shared programs.

The Prime Minister promised to limit federal spending power, period. Will he take action and present concrete proposals in this regard?

[Securities Industry, June 19th, 2007]

Mr. Speaker, the parliamentary secretary is turning a blind eye to Ontario's centralizing grasp and that is what is dangerous.

Does the minister realize that he should respect the will of Quebec and the provinces and put pressure on Ontario to adhere to the passport system rather than ignore the will of Quebec and the provinces?

[Securities Industry, June 19th, 2007]

Mr. Speaker, today and tomorrow the Minister of Finance and his counterparts from Quebec and the provinces will meet to discuss establishing a pan-Canadian securities commission. The Quebec Minister of Finance has stated, and I quote, “There is no proof that it would be less expensive or more efficient and it would create too large a monopoly in Toronto”. Only Ontario wants such an arrangement.

Why does the minister insist on ignoring the will of the majority in order to please Ontario and his Bay Street friends?

[Petitions, June 18th, 2007]

Mr. Speaker, I am tabling petitions signed by hundreds of people who are opposed to the signing of a free trade agreement with Korea if an assessment of the real impact of such a plan is not made. Today, we know the position of the minister, namely that the plan will move forward and the agreement will be signed. Unfortunately, we do not know the content of the agreement and the petitioners are opposed to the signing of such an agreement if it will not benefit the economy.

[The Dollar, June 7th, 2007]

Mr. Speaker, those measures are not enough.

According to a study by the Quebec Forest Industry Council, the dollar's 8¢ rise this year has cost the industry $1.2 billion and eliminated 15,000 jobs. The same thing is happening in other sectors. The Prime Minister has said that he sympathizes with people who have recently lost their jobs.

Isn't it time for this government to do better than offer sympathy, to abandon its laissez-faire attitude, and to implement a real plan to help the industry through this crisis? That is its responsibility.

[The Dollar, June 7th, 2007]

Mr. Speaker, in addition to stiffer competition from developing countries and rising energy costs, the manufacturing sector is now grappling with the devastating consequences of a soaring dollar. The Prime Minister said that he would not intervene.

Is the Minister of Finance aware that the Prime Minister's statements have given the green light to a speculative increase in the value of the dollar and have thereby compounded the misery of manufacturing companies and contributed to job losses, according to experts?

[Business of Supply, June 7th, 2007]

Mr. Speaker, my colleague's accusations were directed more at representatives of the Liberal Party, but setting partisanship aside, there is a lesson to be drawn from this debate. Voters want campaign promises to mean something. Parties and politicians should not make promises they cannot keep. Otherwise, the reputation of both governments and elected representatives is damaged.

Today's motion will serve as a good reminder for the government. This government has a minority and will likely have to call an election, possibly before the fixed date for the next election. Even if the election is held on the fixed date, the House is sending an important message: any party must keep its promises.

We are not afraid to hold up our record on the fiscal imbalance. We supported the government's budget because we believed it was good for Quebec. At the same time, we are asking the government to fully correct the fiscal imbalance by transferring tax points, because we believe that this is important to Quebec's future in the short term.

We all need to take to heart the message that we should not make promises we cannot keep. That is the way to avoid motions like the one before us today. In a way, the Prime Minister and the Conservative Party deserve this motion, because they have not kept their promises.

[Business of Supply, June 7th, 2007]

Mr. Speaker, the last election results support my colleague's remarks. The people decided that they did not want a majority Conservative government because there were not enough guarantees that it was the type of government they were looking for. Furthermore, with a minority government members of the opposition have greater power. They can make presentations and obtain results in the end. We must definitely play a major role as a watchdog.

Let us take the example of shipbuilding. My riding is near the Davie shipyards. We want to ensure that there is a real shipbuilding policy. We must do some checking to see how far today's announcements will go, and if they go far enough. We also have concerns regarding international agreements. Canada is preparing to sign agreements with several countries. We must ensure, in that regard, that the outcome corresponds to what we hope to achieve—that we optimize manufacturing in Canada, particularly in the area of shipbuilding.

We travelled around the Maritimes to research this subject. If we can obtain better results, so much the better. The Bloc believes that it has done a very good job with regard to the budget by obtaining part of the solution to the fiscal imbalance. We will continue to work towards a complete solution.

[Business of Supply, June 7th, 2007]

Mr. Speaker, I thank my hon. colleague for his question. However, his comment might be better addressed to the Minister of Fisheries and Oceans.

In any case, the Bloc Québécois has decided to base its position on the essence of the issue. Let us take another look at the text of the motion.

That, in the opinion of the House, the government has failed to live up to verbal and written commitments made to Premiers by the Prime Minister during the last election campaign with respect to the Equalization Program and the Atlantic Accords.

There is no doubt that equalization is a complex concept. There is quite a history behind the evolution of this practice, this distribution of wealth. Above and beyond that, however, a commitment was made by the Prime Minister when he was a candidate for election. Basically, his mistake was making a commitment that he was unable to honour afterwards.

The fact is, people came to realize that the commitment was not necessarily realistic. For the Bloc Québécois, the ultimate solution needs to be even more advantageous than the Prime Minister's original commitments. Nevertheless, from a political standpoint, the commitment he made should have been honoured. Failing that, a satisfactory explanation should have been given.

At this time, we do not consider the explanation satisfactory and we see that, throughout all the provinces in question—I was particularly impressed by the testimony given by the Premier of Saskatchewan on this matter—utter frustration abounds. This frustration is due to the fact that the commitment should have been expressed differently. Perhaps he should not have gone so far and should have been less focused on vote-seeking. Ultimately, he should have honoured the commitments he made.

[Business of Supply, June 7th, 2007]

Mr. Speaker, today we are debating a motion introduced by the Liberal Party that bears re-reading.

That, in the opinion of the House, the government has failed to live up to verbal and written commitments made to Premiers by the Prime Minister during the last election campaign with respect to the Equalization Program and the Atlantic Accords.

The Bloc Québécois will vote in favour of this motion, because it seems to us that the Prime Minister should have never made those commitments, which he failed to honour. He should have made sure that he would be able to live up to the commitments he was making to Canadians during the election campaign and on other occasions. Otherwise, he should not have made them or promised such things.

The text of the motion addresses only that particular issue. The solution that the government came up with, however, although not ideal, is nevertheless a step in the right direction. In that regard, we must put things in perspective. The Liberal Party can say that the government has failed to live up to verbal and written commitments made to premiers, because that is a fact. But, we must also look at the solution. The Bloc will vote in favour of the motion as it stands.

I would also like to talk about the underlying issue, about equalization. I would remind the House of a number of things. Equalization is fully funded by the federal government using tax money paid by Quebeckers and Canadians from across the country. This equalization program is the result of a fundamental commitment to ensure fairness. In a federation like Canada, equalization has a very specific goal, namely, to ensure that, from coast to coast to coast, Canadians have access to public services at reasonably comparable levels of taxation.

Several countries—most of them federations—have equalization programs. The method consists primarily of evaluating the fiscal capacity of the provinces to provide public services. Provinces with a lower capacity to fund comparable public services receive equalization payments, whereas the others receive none. Quebec receives a significant amount in equalization payments, a little more than 50%. However, on a per capita basis, it finds itself behind several other provinces. In this sense, it is not the spoiled child of the system.

The federal government's equalization payments to the provinces are unconditional and have no strings attached. Equalization does not take into account the expenditure needs of provinces and its sole purpose is to increase the fiscal capacity of the provinces to a common standard. There is no reduction in terms of equalization for provinces with fiscal capacity greater than the common standard.

This is not the first time that this situation has arisen. In June 2004, the former Liberal prime minister made election promises during the federal campaign. The Premier of Newfoundland got the prime minister to promise to let the Government of Newfoundland keep all its oil revenues with no reduction in amounts disbursed to the province under the equalization program.

This position was unacceptable to Quebec. However, the Liberal prime minister did not keep this promise. At the first ministers conference of October 26, Ottawa insisted that there be a cap and that amounts exceeding the cap would result in a reduction of equalization payments. The Conservatives went into action on October 26, when the current Prime Minister made a series of very formal commitments.

Recently, I was at the Standing Committee on Finance when the Premier of Saskatchewan testified. He showed in a very clear, precise way that those commitments were made at that time. In that sense, the motion that we are debating today is justified. However, within the framework of our discussions on this subject, it seems to us that the equalization formula set out in Budget 2007 is a step forward but it falls well short of the unanimous demands of Quebec. It contains some positive aspects. It is a formula founded on principles.

The new formula uses the real value of property taxes. The payments are calculated on the basis of the ten province standard, which pretty well puts an end to the notion of ceilings and floors, but nevertheless it does not meet Quebec’s demands.

What Quebec is demanding is, more or less, the following. It wants an adjustment of the equalization formula that will take into account the ten province standard, 100% of revenue from natural resources and the real value of property taxes. Why 100% of revenue from natural resources? Because, in the past, for example, Quebec developed its own hydroelectric resources without any significant support from the federal government while, in other sectors, other provinces received major financial assistance: Newfoundland, in particular, for the Hibernia project.

Therefore, we want to see 100% of revenue from natural resources included in the formula, so that in the final tally Quebec has a total envelope of more than $16 billion for 2007-08. The only formula that will enable equalization to achieve its objective involves providing receiving provinces with a per capita fiscal capacity equal to the Canadian average.

Quebec’s demands flow from the Séguin report that was published in 2001 and unanimously adopted by the Quebec National Assembly. At that time, the Séguin report proposed four measures for adjusting the equalization formula to make it acceptable to Quebec. That involved the conditions that I mentioned earlier, namely, adopting the ten province standard, including 100% of revenue from natural resources, using real property values in calculating that part of the tax base related to property taxes instead of the theoretical value now in force, and abolishing ceilings and floors in the equalization envelope.

The current government’s proposal to take account of 50% of revenue from development of natural resources seems to us a step in the right direction but it is not entirely what Quebec wants. It continues to advance its demand for the desired result, which is that 100% of revenue from development of natural resources be considered.

All these proposals in Quebec were developed over the years. They resulted not only from the Séguin report, but also from three main documents on equalization reform. In 2004, the Quebec finance department—the Government of Quebec—revised the Séguin report when it tabled the 2004 budget. The document entitled “Correcting Fiscal Imbalance” updates the report of the commission chaired by Mr. Séguin. This document set out Quebec's unanimous demands and estimated the shortfall at $2.8 billion for Quebec for 2004-05 and at $5 billion for Canada as a whole.

Following that report came the Council of the Federation's report in 2005 and, finally, the report of the Expert Panel on Equalization.

All these measures were aimed at recognizing that a fiscal imbalance existed, and it was the Bloc Québécois that raised the issue here in the House. Hon. members will recall that a few years ago, none of the political parties in this House were advocating recognition of a fiscal imbalance. The Bloc Québécois got to work and systematically obtained support from the parties here in the House, until this year's budget was tabled. The federal government has not corrected the fiscal imbalance per se, but it has come up with additional funding that finally corrects an unacceptable situation. The provinces had many needs, while the federal government had the money.

We backed our position on this issue with help from other people and the information and reports I mentioned earlier. But we brought the issue onto the federal political stage. In the end, we won a commitment from the Conservative government that it would pay attention to this issue and correct the fiscal imbalance.

But we find ourselves facing the same situation that the motion criticizes, which is that the fiscal imbalance has not been completely corrected. Admittedly, there was a significant cash component to the budget. This is why the Bloc Québécois decided to support this budget, and as a representative for Quebeckers, it still feels it was the right choice.

However, there is still a fiscal imbalance, and in the years to come we will remain dependent on economic vitality, revenues from the federal government, and the situation of the provinces. A permanent solution would be the transfer of tax points, tax transfers, which is currently not the case.

So the Bloc Québécois will continue to fight for a permanent solution to this current situation in which Quebec does not receive its per capita share compared to the other provinces. The debate on whether or not to take into account revenues from natural resources is an important one and will continue.

With the Liberal motion presented today, we can see that in a number of Canadian provinces, people who had received commitments, and who do not see those commitments in what was adopted, are frustrated. At the same time, it is clear that the discussion held to reach the solution set out in the budget is a step in the right direction.

Unfortunately, the Prime Minister should not have made these commitments if he was not certain he could live up to them. He has not lived up to them, or so the motion says and criticizes. The only thing to come out of all this so far was that the Bloc Québécois obtained significant amounts of money for Quebec through the federal budget. We hope to be able to continue in that vein. Nonetheless, our ultimate goal is truly to come to a solution that will no longer be subject to all the ups and downs that are often caused by election periods.

Earlier we looked at the background of the situation. In the past, the Liberal Party made commitments that it did not keep. The leader of the Conservative Party made commitments he still has not kept. Ultimately, the motion is on the credibility of politicians and the commitments they make.

In certain instances, the public is able to understand that something has to give. However, for formal commitments on basic issues such as these, it would have been better if the Prime Minister had not made such a commitment. He should have instead promised to work on finding a better solution. That is not the commitment he made to the provinces, which are particularly frustrated. There was also the commitment made to Quebec to do away with the fiscal imbalance. The solution is still not on the table. There is a monetary correction, but no final solutions. Quebeckers are still waiting for a solution to this issue. They will continue to take stock of the effectiveness of the hon. members and the parties in this House, namely on the issue of correcting the fiscal imbalance.

It is important to have a debate on this motion today because we are talking about the credibility of politicians. We have to be able to make the distinction between keeping a commitment and making proposals as a result of further analysis. In no way can we justify not keeping these formal commitments when there is no good explanation for it. The people in the provinces concerned get the impression they were hung out to dry because the Conservative Party did not keep its election promise.

That is a serious warning for the future. This is a minority government that could go to the polls at the drop of a hat. Political parties will continue to make promises. The lesson to be gained from this is that if we wish to maintain our credibility as politicians and political parties, we must not make promises that we cannot keep.

Can we be sure that they knew this when they made the promise? That is something we should spend more time considering. All the same, the promise should not have been made.

Recently, we have been talking about the marked decline in voter participation in the electoral process. Actions like these are damaging. What we are doing today is reminding the government of its responsibilities, and a timely reminder it is, too. However, this reminder is unrelated to the measure in the budget that is a step forward for Quebec.

I hope that the government will take careful note of the message to be found in the House's vote on this matter. I also hope that, starting now, we can count on the government to keep its promises. If ever it finds that it must change its position on a given measure, I hope that it will be able to justify its action and offer clarification so that the purely partisan tenor of the debate on this issue can be avoided.

In conclusion, the Bloc Québécois will support this motion because it believes that the government has indeed failed to keep its promises. However, the members of the Bloc Québécois still believe that the government's budget is a step in the right direction.

Although equalization and the measures in the budget are not quite up to Quebec's expectations, more time must be devoted to considering natural resource revenue.

In that respect, we will continue to support the budget. However, the government and the Prime Minister should take note of the reminder at the core of today's motion.