Madam Speaker, unlike the last speaker, I think it is a great honour for me to stand today and support the budget. I am very proud of its very bold and visionary approach to fiscal management.
Throughout this budget the Minister of Finance had in effect courageously redefined Canada's system of government while at the same time maintaining the basic principles of fairness and equity.
There are some specific areas of the budget that I would like to address today, especially as they impact on British Columbians and on my constituents.
I would like to stress that this budget has fulfilled all the promises made by our government. It was tough but it was fair. This budget has ensured that the financial burdens faced by all Canadians will be distributed in an equitable manner. It started by cleaning house, by setting an example of frugality and fiscal prudence from the top.
There is no NIMBY syndrome in this budget. We started right in our own backyard. We redefined government by downsizing, by becoming lean and efficient and by enunciating a more appropriate role for government, one that enhances growth rather than manages it.
We did this by getting out of mega projects, by cutting back on subsidies to businesses, to farms, to transportation and to mining. We feel that these sectors can sustain themselves and be competitive if we just get out of their way. They have told us this often enough and now we are doing it.
We will commercialize viable sectors like transportation so that they can be self-sustaining and so that the users pay for their services rather than all taxpayers. We will still ensure that public safety and national standards are maintained.
This budget clearly comprises a major turning point in our economic history. In the last few years we have been straining to govern. We have been straining to survive under the cloud of a burdensome debt and a dangerous deficit.
This economic downturn we just suffered compounded the negative impacts of the deficit and the debt by affecting our credibility in world markets. Our economic sustenance was at the beck and call of investment bankers in New York and editorial writers in Washington.
We had two choices. We could continue to ride the downhill spiral toward indebtedness and even to third world status or we could take measures to change direction. We needed a revolution and this budget has provided us with one.
Over the next two years this budget will create cumulative savings of $13.3 billion, $11.9 of which will represent cuts in government spending. That equals $7 of spending cuts for every dollar of tax revenue. As a result in 1996-1997 our economic growth will finally be greater than the growth in our debt.
This is a key element. It marks the turning point in our indebtedness as a nation. It means that we will be taking in more money than we are borrowing for the first time since World War II. We have finally turned the corner.
Contrary to the rhetoric spawned by the furious and impetuous reaction of opposition parties and other groups, this budget does not reduce our commitment to social programs. I think rather it enshrines it. By taking control of our finances we have regained our sovereignty and our ability to make our own decisions about the kind of social democracy we want to live in. We have empowered ourselves so that we can make decisions based on our values as a people; values of compassion and of social justice, values that see government's role as one which creates opportunity for all, one which removes obstacles and one which protects the most vulnerable in our society.
This budget will let us protect our social programs from the investment bankers and editorialists of the world. By achieving our deficit targets we are taking action to prevent New York or Tokyo from in effect running our country and defining our social programs. A Liberal government could never allow that to happen.
I am glad to see that this budget, tough as it is, was not balanced on the backs of the poor, the sick and the elderly. As Parliamentary Secretary to the Minister of Health, I am pleased to note that his budget in no way affects the medicare standards and principles that are so dear to us and that are enshrined in the Canadian Health Act. Health care delivery across this country will continue to be comprehensive, universal, portable, accessible and administered by the public. In the red book we committed to ensuring that these principles are upheld and we are keeping that promise.
Yesterday in a typical knee-jerk reaction to the speech by the Minister of Finance, the Leader of the Opposition and his finance critic stated that the budget was merely another confirmation of status quo federalism. It is clear that the Leader of the Opposition did not read the document, or if he did he did not understand it.
The budget does the exact opposite. It clearly marks the beginning of a new era of federalism and of federal-provincial relations. It is a move in the direction of a leaner, more efficient, more accountable system which recognizes provincial responsibilities and the ability to redesign and redeliver effective services at the local level; the bottom up approach that the opposition parties so often tout but are reluctant to implement.
In reading the newspapers this morning I noticed that much of the media has focused its concerns on the new system of block funding, the Canada social transfer which will result, it says, in fewer services being provided by the provinces. On the contrary, with the new system of lump sum transfer payments, our government is in effect giving the provinces greater flexibility and greater leverage in the administration of their social programs.
The federal government's role has been redefined but in a positive way. I firmly believe that these changes will provide a window of opportunity for us to set clear national standards for all social programs. This is a move that my constituents and groups across this country have advocated for years.
Instead of balkanizing the country, this move will allow us to set national objectives for education and social security like we have done so successfully with health care.
Since its inception medicare has given over the management and administration of health care to the provinces governed by a set of principles enshrined in the Canada Health Act. This has created a health system that binds us together as Canadians, a system of which we are duly proud, a system that has freed the federal health department to concentrate on the broader issues
that affect the health and safety of all Canadians. This is what we intend to do with the devolution to the provinces.
I trust that following his consultations with the provinces the Minister of Human Resources Development will act swiftly in proposing standards and principles that will see us act along the lines of the Canada Health Act and the standards for administration and national care we see as a nation.
The Canada social transfer will do exactly what we want it to do. We have shown by our leadership as a federal government that we can provide better, leaner and more efficient government. I believe the provinces will rise to that challenge and be able to show us that they can do just as well as we can and as we have done.
I would also like to talk a bit about the changes to the Unemployment Insurance Act that I feel are very important. I believe that one of the key issues of unemployment at the moment is in keeping with our Liberal mandate, which is to get people back to work and keep them at work. If we can concentrate our efforts on employment services and training we will do exactly that.
Those Canadians who feel very vulnerable now because they are unemployed and who are concerned that this will damage their futures should not be concerned because our move is to give them the tools and skills needed to get them back to work, to stay in work and to make us a more competitive nation. We are removing the safety net but we are providing a springboard. I think most Canadians want a springboard.
We are also cutting some funding to the unemployment insurance program. By the fall of next year the funding will be reduced by 10 per cent. This is only funding that is going to be done because of downsizing of administration and because it will automatically come from the lower unemployment rates. As the House knows, we have been creating jobs and have brought our unemployment down by two percentage points, which had not been done over the last 10 to 15 years.
We are also moving to reduce some of the abuse that I hear from all over the country is endemic in the system. That will save us $200 million.
Furthermore we are looking to do something that is innovative and creative. We are looking to build a $5 billion surplus in the UI fund so that we do not have to make the same mistakes we made the last time. When the cycles of recession and downturns in the economy come we will have a buffer to start so that we do not have to increase UI premiums and therefore hamstring the businesses that need to grow, to help us to sustain the economy in bad times. This is just common sense.
By maintaining a surplus we will be able to mitigate the rates and help in periods of slow economic growth. It will also help us to encourage job creation at a crucial time when we are recovering from downturns in the economy.
In addition, I am very pleased to note that throughout the budget the government has remained totally and absolutely committed to a fair and sustainable system of protection for seniors. It recognizes the important contributions that seniors have made to Canada's social and governmental infrastructure.
I have a large seniors population in my riding. They have been very concerned that their pensions would be destroyed in the budget. I am pleased to be able to tell them that the two main pillars of the public pension system, the Canada pension and the Quebec pension plan, the old age security and the guaranteed income supplement will be maintained and improved.
In the budget the Minister of Finance has promised to sit down with the provinces in the fall to review our very shaky Canada pension plan. The Minister of Finance pledged to release a paper in conjunction with the Minister of Human Resources Development to recommend changes to the system to ensure its affordability, fairness and sustainability as many of us baby boomers move into old age.
Finally, the minister is announcing a change in the method of payment of old age security to high income seniors who have been subject to the so-called clawback. This is simply an administrative, common sense approach. If we pay out our benefits to individuals at a time every month instead of waiting until the end of the year to give in and pay back, it just prevents a lot of paperwork. That is the kind of silliness that has been costing so much money in government spending over the last few years.
The budget has also followed through on our red book promises to maintain fairness and equity in our taxation system. The Minister of Finance has refused to balance the budget on the backs of the poor. Rather it seeks to distribute the onus of fiscal frugality to those who have traditionally not been paying their fair share.
Reforms to family trusts are a good example. I firmly believe that in times of fiscal restraint all Canadians should pay their fair share and not escape through nice old loopholes.
The budget eliminates the cap and justly so for family trusts, changes to the family trust administration and will terminate the preferred beneficiary election for trust taxation years that begin after 1995, except where the beneficiary is physically or mentally impaired. Again the government has done a sensible thing with compassion so that we will not harm those who are most vulnerable.
I recognize that family trusts have many valid non-tax objectives such as helping with succession planning, but these changes ensure that family trusts will not be used to defer capital
gains for income splitting purposes. That is the loophole we were trying to get rid of. Once again the budget has shown that we are committed to reductions as long as they are fair.
There is more good news for my constituents in the budget such as changes to the government's role in transportation. The federal government's role in transportation is evolving from that of being an operator of the system into one that is primarily a policy maker, a regulator and a landlord with only limited operational responsibilities. Subsidies are being reduced and in many cases eliminated. Major operations will be given more commercialized forms and remainder operations will be made more efficient with greater reliance on users rather than taxpayers to pay the cost of the transportation system.
Thus the budget reduces net spending by Transport Canada and related agencies by over 50 per cent in 1997-98, from $2.8 billion to $1.4 billion. As a consequence the port of Vancouver in my riding and other ports across Canada will have the opportunity to thrive under the autonomy they have sought for many years now and finally become competitive.
Changes to the mining sector will have a positive impact in the long run in B.C. In the budget the federal government has decided not to renew mineral development agreements, but it also likes to emphasize that this non-renewal does not mean it has abandoned the mining sector. The mining sector has not had a fair system of taxation to assist it in different levels of mining such as reclaimed mines versus new mines. We are going to look at these issues so that we can give that sector what it needs and remove the barriers so it can thrive and become as viable as we know it can be in Ontario and in British Columbia.
I would like to comment a bit on members of the Reform Party in the House who have attacked our budget. They have said we have not done the things we should do and they have discounted our figures. They have said that we have been hypocritical.
The budget tabled by the third party was punitive and non-creative. Throughout the history of the country the Liberal Party has always been here at times of change. Whenever the country has sought to move into new areas, has sought to become a greater country or has sought to change the way we do things, there has always been a Liberal government in place to lead us into the changes.
We are moving into the 21st century. There will be many challenges for the country. We have seen we need to be competitive. We have seen we need to look at training. We need to look at employment. We need to look at jobs. We need to look at economic growth. We are focusing on economic growth. We are focusing on the engines of growth: small business, science and technology. We are going to make the country move forward.
As always, a Liberal government has been there to help Canada to manoeuvre its way through difficult times. We will be here once again to move us into the 21st century when I know the world will look to Canada for leadership.
