Mr. Chair, I am thankful for this opportunity to appear before this committee. In my time today, I would like to focus on the importance of balancing the budget.
Let me begin by saying how proud I am that our government has fulfilled our promise to Canadians. We have balanced the budget in 2015. We have done it while giving benefits directly to families and by reducing taxes on the middle class. However, the Liberals and the NDP want to take those benefits away and raise taxes on the middle class.
Thanks to the strong fiscal prudence and economic stewardship under our Prime Minister, the deficit has been reduced from $55.6 billion at the height of the global economic crisis to a projected surplus this year of $1.4 billion, and $1.7 billion the year after. That is a solid foundation upon which to build a more sustainable public finance.
On this strong foundation, we are building a brighter future, but we must stay the course with our low-tax plan. Canadians know what to expect from our government. Our budget prudently accounts for changes to the global economy, eliminates the deficit, and continues to deliver low taxes, economic growth, and long-term prosperity.
Contrast our low-tax plan with the Liberal one, according to the current Liberal finance critic:
It is unacceptable, frankly, that the [previous Liberal government] balanced the budget on the backs of ordinary Canadians and [refused] to provide any benefits back to the ordinary Canadian taxpayer.
That is the Liberal plan. In contrast, our government will continue our low-tax plan for jobs, growth, and security, and while balancing the budget as well.
There is a path to prosperity, and then there is a path to spending hikes, tax hikes, and unaffordable debt. We must choose the right course, the course that will create jobs and growth, not stifle the Canadian economy and hurt families. That is what Canadians expect of their government. Unlike the Liberals, our government does not believe that we can nor should tax our way to prosperity.
Let me remind members that it was the Liberal leader who said “Canadians could be convinced to accept a tax hike if it means a better economic plan”.
This type of ideology of tax and spend is not surprising, given the last time that Canada saw a Trudeau in government. Federal spending tripled, prompted by temporary highs in commodity prices, and this type of reckless spending was not in response to economic crisis. As a result, under Pierre Elliott Trudeau's mandate, Canada experienced some of the worst federal budget deficits in peacetime history. We are still paying for it today.
In common Liberal fashion, Jean Chrétien balanced the budget by hiking taxes, cutting vital programs, and slashing billions in transfer payments. Such actions put Canada's health care and education at risk. Everything we have learned from the post-recession history proves that Liberal policies would be devastating for the economy.
Unlike the Liberal leader who thinks budgets balance themselves, our government has brought Canada back to balance this year. Canadians understand the importance of living within their means and expect their government to do the same. Balanced budgets keep taxes low and ensure that government services are sustained over the long run. More importantly perhaps, they ensure that future generations like our children and grandchildren are not saddled with huge debts.
However, if given the chance, the opposition would raise taxes and drive Canada into dangerous levels of deficit and debt. The Liberal finance critic said it himself: “Liberals believe Canadians will not be bothered by being taxed more and more..”. Again, that is an example of the Liberal's tax and spend policies.
This is not a formula for success, nor what Canadians need or want. Canadian families sit around their kitchen table to talk about their budgets and how to stretch every dollar. They cannot afford to pay more taxes. Such Liberal schemes will not help them balance their budgets; in fact, it would do the opposite.
Our government is not only setting an example by balancing our budget, but we are helping families balance theirs as well, by giving money directly into the pockets of every hard-working Canadian family. Again, this is in stark contrast to the Liberal leader, who said, “benefiting every single family is not what is fair”. I believe that contrasts with the very definition of fairness.
Our Conservative government believes it is fair to benefit every single Canadian family and provide opportunities for all Canadians. We will make no apologies for helping all Canadian families. We understand that benefiting every single family is indeed our definition of fair.
Given the ongoing uncertain global economic environment, it is not the time for risky plans or reckless spending as proposed by both the Liberal and NDP leaders. Instead, it is crucial for the government to continue to pursue the objectives that have underpinned the economic action plan since its inception in 2009.
That is why we have introduced balanced budget legislation. It will ensure that the hard-won gains achieved by our government will remain in place for future generations. It will also ensure that the only acceptable deficit will be one that responds to a recession or an extraordinary circumstance, such as war or natural disaster.
It is not uncommon for a government to run deficits to respond to a severe downturn in the economy, but deficits outside of a recession or an extraordinary circumstance are unacceptable, and the need to return to balanced budgets is immediate.
To that end, this legislation proposes that should Canada again enter into deficit, the finance minister would be required to testify before the House of Commons committee on finance within 30 days and present a plan, with concrete timelines, to return to balanced budgets. Moreover, should the deficit be due to a recession or other extraordinary circumstance, operating spending would be frozen, as would the salaries of ministers and deputy ministers government-wide, once the recovery begins. If, on the other hand, the deficit is due to mismanagement, operating budgets would be frozen automatically, and the salaries of ministers and deputy ministers alike would be reduced by 5%.
This approach would ensure that any increase in spending to respond to a recession, war, or natural disaster would be temporary, targeted, and timely. By balancing the budget, we are raising Canada's economic potential and creating stable, well-paying jobs.
By staying the course and sticking to our proven economic action plan, Canada remains on track to a better future for all Canadians. That is what Canadians want and deserve. They cannot afford a tax and spend government, something the opposition is much too eager to do. Canadians know that it is our government that will keep taxes low, help foster jobs, and create long-term prosperity so that our children and grandchildren have a bright future.
In closing, I would like to ask a question to the Minister of Finance. I would like to ask him why balanced budgets matter.