Gerald Keddy

[Budget Implementation Act, 2008, June 3rd, 2008]

Mr. Speaker, I thank the member for his sincerity in asking that question, but the member would know that we have increased our budget for foreign aid substantially over what his government had in foreign aid. CIDA has taken a much more proactive stance in the world and has positioned itself to deliver aid more efficiently. There are a number of factors on a number of fronts where we have been proactive on foreign aid.

On the question about rice specifically, I recognize the need for some immediate relief there and I appreciate that, but the question of rice is greater than simply aid. We have had a crop failure in much of Asia. There is a drought in Africa.

I thank the member for not trying to get off track here of the real issue and saying that somehow this is ethanol production in the world that is causing a food shortage, because that is quite frankly not what is happening at the present time. The issue is a concern and we have put more funding toward it.

[Budget Implementation Act, 2008, June 3rd, 2008]

Mr. Speaker, this budget debate has gone on long enough. The NDP members continue to rail against it. We are delaying $1.5 billion in spending that is in jeopardy and that Canadians are waiting for. They continue to delay, to confuse, to obfuscate, and to live in a land of make-believe. It is unacceptable.

Therefore, I move:

That this question be now put.

[Business of Supply, May 29th, 2008]

I was not certain, Mr. Chair, about the question, but I think he was continuing on bulk water. Bulk water is not tradeable. It is not a commodity.

[Business of Supply, May 29th, 2008]

Mr. Chair, the answer is quite simple. Every once in a while one of the opposition members asks this question. The answer never changes. Water is not a commodity. Water is not traded across the border. It was not traded by the previous government and it will not be traded by this government.

Further to that, the regulations in the International Boundary Waters Treaty Act prohibit the bulk removal of boundary waters from their water basins for any reason.

The opposition parties can continue to ask this question, but the answer will remain the same.

[Business of Supply, May 29th, 2008]

Mr. Chair, as most people in the House will know, our government, our Prime Minister and the Minister of International Trade have taken a serious look at the Americas and a re-engagement with it.

What many people do not realize is the fact that Canadian foreign direct investment in the Americas is worth $100 billion. That is more money than our trade is worth with China and more money than our trade with India, and it is right on our doorstep. It is a huge opportunity and one that we would be careless not take advantage of and pursue, not only for our own good, but for the good of the other countries in the Americas.

The international trade committee did travel to Colombia. We spent four days in Bogota. When we left there, we went to Panama. I then went on to Honduras and Nicaragua. There are ongoing trade negotiations with the Central America four countries, Honduras, Nicaragua, El Salvador and Guatemala.

I was chagrined to see some of our committee members turn their backs on the opportunities in Colombia. A few years ago Colombia was in dire straits. It was practically a failed nation. Today it is moving forward. It has a growth rate of 7%. There are 1,000 Canadian businesses in Colombia. That is a huge commitment on our part. They show all the corporate social responsibility that Canadian companies are famous for around the world.

[Business of Supply, May 29th, 2008]

Mr. Chair, as Parliamentary Secretary to the Minister of International Trade, it is certainly a privilege to rise in the House today to talk for a few minutes about the implementation of our global commerce strategy and how it will help Canadian companies and investors succeed and thrive in the global economy.

A few weeks ago, the hon. Minister of International Trade tabled in the House legislation to enact Canada's first free trade agreement since 2001, an agreement with the European Free Trade Association nations of Iceland, Liechtenstein, Norway and Switzerland. It is an important agreement for Canada, one that gives our businesses competitive terms of access in these important markets and a new link in the growing network of European supply chains.

Just today, we signed a free trade agreement with Peru, an economic leader in Latin America. This new agreement will open new doors for exporters, service providers and investors in this important market.

These agreements are watersheds in Canada's evolving trade strategy. They send a clear signal to the international community that Canada is back in the global commerce game. And they prove that this government is committed to sharpening Canada's competitive positioning in the global economy.

We believe that a strong, aggressive and forward-looking trade and investment strategy is good for Canada. The global economy is evolving and we have to adapt accordingly.

When we talk of trade today, we are talking about “integrative” trade: in other words, the whole range of commercial exchanges that go into creating wealth and prosperity in the global economy. Of course, this includes exports and imports.

It also includes investment, innovation and technology exchanges. These are all part of creating economic opportunity and success.

The level of competition is enormous. Trading nations like ours are facing a competitive landscape like never before, from traditional competitors such as the U.S., Australia and the EU as well as emerging giants such as Russia, Brazil, India and China.

In addition to this fierce competition, we also are facing a range of other challenges, including a high dollar and a slowdown in the U.S. economy. These challenges risk eroding the competitiveness of our exports, our ability to attract foreign investment and ultimately our ability to participate in global value chains.

It is also a world where governments are competing with governments to support their businesses and investors in the right ways, in the right markets, with the right tools.

That is where our global commerce strategy, led by the hon. Minister of International Trade, comes in. Under “Advantage Canada”, this government has demonstrated its commitment to creating a more competitive economy on several fronts.

From reducing red tape and streamlining regulations to an ambitious series of tax cuts, to education, infrastructure and a range of strategic investments and initiatives, steps are being taken to create a more competitive domestic economy.

Our Asia-Pacific gateway and corridor initiative is a good example. It is a bold, visionary effort to boost our west coast transportation infrastructure and create a gateway of choice for shippers and businesses looking for the most efficient link between North America and the Asian marketplaces.

Our global commerce strategy fits squarely into our efforts to create a more globally competitive economy. It flows from our recognition that to be globally competitive our businesses need to be supported in the right markets and, again, with the right tools.

Of course, market access for our businesses and investors will always be a crucial focus of our work. That is why the WTO will be our preferred forum for market access. We will continue working with our partners to push hard for a successful conclusion to the Doha round.

In the meantime, we are stepping up our efforts on the bilateral front, first and foremost as a partner in the enormously successful North American commercial platform. Canada benefits greatly from being part of NAFTA and we are working closely with the U.S. and Mexico on a range of issues to keep trade, investment and talent moving across our borders and ensure that the North American partnership remains strong and prosperous.

This is especially crucial in this day of an economic slowdown in the U.S. South of the border, protectionist voices are growing louder. It is up to all of us who believe in a strong North American platform to remind people that it is a competitive world out there and we need this platform today more than ever.

Thanks to NAFTA, the world looks at North America as an integrated continental marketplace of 440 million people bound together by an ambitious free trade agreement that has created one of the most prosperous commercial platforms anywhere on the planet. We need to support this message with concrete action to make the North American platform more competitive and help all three countries deal with the challenge posed by commercial powerhouses such as China, India and Brazil.

Now is not the time to turn our backs on the platform but indeed to rededicate ourselves to it and make it even more competitive in the years to come. With our American and Mexican partners, that is exactly what we are doing.

We are also getting more aggressive on the bilateral front outside of North America. In addition to the EFTA and Peru agreements, our negotiators are busy with a long list of other negotiations around the world, with Colombia, the Caribbean community, the Dominican Republic, Jordan and South Korea, for instance.

We are engaged in a joint study with the European Union on the cost and benefits of a closer, economic partnership. We are looking to launch negotiations with new EFTA partners.

The results of these efforts should provide our businesses and investors with new links and improved access to new markets, but it is not all about FTAs. We are focused on other kinds of agreements too.

Air services agreements are a good example. We currently have more than 70 in place. Since last January, we have successfully negotiated new or updated existing agreements with nine countries, including Japan, Ireland, Kuwait, Jordan, Iceland, New Zealand, Singapore, Mexico, and Barbados. That sounds like a country and western song, Mr. Chair.

We also recently launched negotiations with the EU toward a comprehensive air transport agreement. This is expected to result in an open skies framework between Canada and all 27 member states, including eight countries where rights currently do not exist at all.

We are also engaging in consultations with a number of key bilateral partners, including the Philippines, South Korea, India, Japan, China and Hong Kong, to continue liberalizing air services.

Investment agreements are another good example of how we can work with our partners to create more opportunities. Canadian firms and investors clearly recognize the importance of investing globally. To support them in these efforts, Canada has 23 foreign investment protection and promotion agreements, or FIPAs, in place with key partners around the world, including, most recently, Peru.

We also have concluded negotiations with India and Jordan. Negotiations are now under way with China, Kuwait and Vietnam and exploratory discussions are being held with a number of countries in Asia and Africa. These agreements will help Canadian firms and investors build their own links in the value and supply chains driving business around the world.

We cannot forget the importance of research, science and technology in a competitive economy. Our recently announced science and technology strategy is helping us to create a more competitive and dynamic business environment that encourages investment in S and T and innovation.

The strategy also highlights the importance of partnerships with other innovative countries to access foreign knowledge, technologies and expertise in creating marketable products. That is why science and technology cooperation agreements are another focus of our work under the global commerce strategy.

Canada currently has agreements in place with countries such as China and India, which are helping to boost research and develop collaboration and bring new high tech products to market quickly. We are negotiating similar arrangements with Chile and Brazil. These agreements are a great example of how countries can join forces, build off each other's strengths and put exciting innovative products to work on the global stage.

We are also keenly aware of the important role strategic government services can play in helping connect our businesses and investors to global opportunity. For example, the Department of Foreign Affairs and International Trade is working closely with Canadian businesses to develop a series of targeted, sector-based market plans for key markets. These plans embrace the full range of international business activities, from exports, imports and investments to science and technology, licensing and the negotiation of market access through trade and investment agreements.

We also enjoy a wide-reaching international commercial network. We currently have about 900 trade commissioners active in over 150 cities around the world, including 13 regional offices across Canada. These dedicated men and women are adapting to new global business models like integrated trade and helping to create new partnerships with nations around the world that will benefit all of our economies.

To support them in these efforts, we are opening new trade offices in the world's most exciting markets, including China, India and Brazil. We are committed to offering the right services in the right markets for Canadian businesses to help them succeed and thrive in the new global economy.

The global commerce strategy is a road map to help our businesses and investors adapt to the complex reality of integrated trade. Through it, we are getting Canada back in the global commerce game. We are sharpening our competitive advantages and helping Canadians create wealth and opportunity in some of the world's most exciting markets.

I respectfully ask for the support of all hon. members as we take more steps to create a competitive and prosperous Canada in the years to come and bolster Canada's solid position as a natural business destination and a partner of choice for international business for years to come.

[Business of Supply, May 29th, 2008]

Mr. Chair, when the special economic measures were put in place, Canadian companies known to DFAIT had divested, or were divesting, their interests in Burma, with the exception of CHC Helicopter, which was locked in a long term contract with Total and Petronas. CHC was subsequently acquired by a U.S. private equity firm, which has reiterated its commitment to divest all of CHC's interest in Burma.

[Business of Supply, May 29th, 2008]

Mr. Chair, the answer is quite simple. According to the Canada Pension Plan Investment Board, the Canada pension plan is in full compliance with SEMA measures, with no investments in Burma that we are aware of.

[Business of Supply, May 28th, 2008]

Mr. Chair, I would like to commend the minister on the great job that he has done as finance minister for this country.

The minister was talking earlier about a couple of things with respect to major trends in the economy. He was speaking about the competitive advantage in Canada. All of this is not complex. Some of this is fairly basic principles.

Managing spending is certainly as important as cutting taxes and paying down the debt. When it comes to prudent and responsible fiscal management, spending has to be managed. I would like the minister to expand on what this government is doing to ensure responsible management of spending through the expenditure management system.

[Business of Supply, May 28th, 2008]

Mr. Chair, I am thankful for the opportunity to speak to the Department of Finance's main estimates for 2008-09 and more broadly to the economic leadership of our Conservative government.

Under the leadership of our outstanding finance minister and this Conservative government, we have delivered three straight balanced budgets along with two economic statements, truly remarkable achievements in a minority Parliament.

Included in these achievements is our centrepiece economic plan, “Advantage Canada”, which we outlined to Canadians in November of 2006. “Advantage Canada” represents a prudent, long term road map to ensure Canada has strong economic fundamentals. It is a plan designed to help ensure Canada truly becomes an economic leader through tax, fiscal, entrepreneurial, knowledge and infrastructure advantages.

“Advantage Canada” is not the reactionary, short term and ultimately ineffective economic plan, and I use that word loosely, being advocated by the Liberal opposition. This government has rejected the flight to panic the Liberals have embraced when it comes to economic policy.

Instead, with “Advantage Canada” we have brought forward a long term plan that not only addresses the challenges of today but prepares us for the opportunities of tomorrow. There is nothing like a message of hope. The Canadian Council of Chief Executives has observed that “the Advantage Canada strategy...will enable Canadians to take on the world and win”.

Tonight I would like to focus on one key component of the “Advantage Canada” plan: the creation of a fiscal advantage through debt repayment. Our Conservative government has set ambitious debt repayment targets. Indeed, we are aiming to eliminate total government net debt within a generation or by 2021.

Why? Unlike Liberal governments past, our Conservative government refuses to saddle our children and grandchildren with the bill for the excesses of the past and the present. We refuse to pass on a large national mortgage. We understand that debt just delays taxation to the next generation.

However, we are not merely musing about debt reduction with empty words and hollow promises, the hallmarks of Liberal governments past. We are taking decisive and aggressive steps to meet our targets.

Indeed, since forming government a little over two years ago, we have already reduced Canada's debt by $37 billion. We have brought Canada's national mortgage to its lowest level in 25 years and federal debt to GDP ratio to historic lows. Put another way, we have reduced Canada's national debt by almost $1,570 for each and every man, woman and child in Canada.

Yet challenges remain. Despite our aggressive action, our national debt remains considerable at nearly $457 billion in 2007-08. Interest charges on all that debt will cost roughly $31 billion a year or about $85 million every single day, meaning that approximately 13.5¢ of every taxpayer dollar sent to Ottawa will go simply to pay the interest on our debt.

Amazingly enough, though, some in the House have suggested that all of this is not really a concern and have even criticized our government for having the audacity to even consider our national debt a problem. For instance, the Liberal leader flippantly dismisses the national debt as “light”.

Instead, he wants to plunge Canada into a massive $60 billion deficit spending spree that would wipe out our progress in taming the national debt. I want Canadians to think about the Liberal leader's thinking for a moment.

If someone we knew was personally half a million dollars in debt, decided to go out on a reckless shopping spree, max out his or her credit card or rack up a $60,000-plus bill the person could not afford, and as a consequence add to his or her existing debt, what would we say to the that person? I suspect the words “fiscally irresponsible” would jump to mind.

Therefore, I ask Canadians if they really agree with the Liberal leader when he calls our $457 billion national debt “light”. I will let a recent Montreal Gazette editorial answer that question. It states:

--to say that a $457-billion debt is low is like saying winter is short: there's just no sense in such a claim....

--the higher the national debt, the less control our government has over its own finances, and so the less control Canadians have over our own lives. Paying down the debt is in the long run the best social program of all.

We agree. That is why when it comes to debt repayment, we are committed to doing more. We are pledging to bring our government's total debt reduction to more than $50 billion by 2012-13.

It is clear that we are making substantial progress, progress that previously the Liberals failed to make on lowering Canada's national mortgage so future generations can succeed.

In the words of the Liberal member for Halton:

[Debt reduction] is exactly what a majority of middle class Canadians and working families want. It's what Tories are good at...often called upon to save the country's finances after long bouts of...Liberal spending.

Furthermore, we believe that when the debt load falls, Canadian taxpayers, not government coffers in Ottawa, should benefit. That is why we legislated into law the landmark tax back guarantee. Under this guarantee, each year interest savings from federal debt reduction are returned to the Canadian taxpayers through permanent and sustainable personal income tax reductions. What a novel plan for Canadians. What a great idea. As of 2009-10, personal income tax reductions provided under the guarantee will amount to a whopping $2 billion. No wonder the Canadian Taxpayers Federation called our tax-back guarantee music to taxpayers' ears.

I would like to delve into some of the longer term structural benefits of debt reduction which, while not necessarily top of mind, are crucially important to a strong Canada and a strong economy.

First, the most direct benefit of lower debt is that less revenue is absorbed by interest charges, freeing up resources for more productive uses. As the Canadian Institute of Chartered Accountants has recently noted, continued debt reduction remains vital to improving the government's financial condition, enhancing prosperity and providing the flexibility needed to deliver on meaningful tax deductions.

Second, low public debt also helps keep interest rates low. In the early 1990s, inflation adjusted long term interest rates averaged over 6%, reflecting in part the risk posed to investors by the much higher level of indebtedness in Canada at the time.

Since the government sets the benchmark for all the borrowers in the economy--provincial and municipal governments, corporations and households--high federal debt imposes a significant cost to the economy. Higher borrowing costs led to lower private sector investment and a less productive economy.

Today, ongoing surpluses and falling federal debt help keep interest rates low. Inflation adjusted, long term interest rates are currently just over 2%. This makes it easier for Canadian corporations to raise funds to finance capital investment, and that translates into higher private sector investment and a more vibrant, productive economy, creating more jobs for more Canadians.

This also benefits Canadians more directly as well. For instance, lower interest rates produce real savings for families making a big purchase, like the young couple in Oakville buying a new $200,000 house. Having already seen a $4,000 price reduction because of the GST cut, with a $160,000 25 year mortgage, they would save over $1,100 annually for each percentage point drop in interest rates.

Debt also, as I alluded to earlier, represents a tax on future generations.

Before criticizing our Conservative government's record of aggressive debt repayment again, I encourage the Liberal finance critic to take a break from working on the Liberal Party of Canada's secret plan for a massive new gas tax on home heating for seniors and those on fixed incomes, and to listen to his own words. He said that, with an aging population, it is crucially important to pay down debt so we baby boomers do not leave our children and our children's children in terrible shape.

As I conclude, let me ask the Minister of Finance if he thinks Canada should, as suggested by the Liberal opposition, go back to the practice of deficit spending, add to the national debt, and reverse all progress we have made in lowering Canada's national debt. Does he think--