Jason Kenney

[Budget Implementation Act, 1997, April 2nd, 2001]

Mr. Speaker, I am pleased to rise on behalf of the official opposition in the debate on Bill C-17. I thank the parliamentary secretary for mercifully abbreviating his remarks.

I will say at the outset that the bill, as the parliamentary secretary has indicated, deals with amendments to two statutes. One deals with funding for the Canada foundation for innovation and the other deals with amendments to the Financial Administration Act, the FAA. Neither are related, but the government has decided to parcel them together in the one bill. Both elements of the bill are evidence of how the government approaches legislation in an inappropriate fashion.

Let me address the bill as it concerns the Canada foundation for innovation. It proposes to give statutory authority to an announcement already made by the Minister of Industry to increase funding to the CFI by some $750 million.

I think many of my colleagues will share this sentiment: I find it troublesome, to say the least, that parliament is constantly putting forth legislation to authorize spending that has already been announced as a fait accompli by the government, in this case by the Minister of Industry.

Rather than coming before the House of Commons to seek the authority of parliament before making public and political commitments, the government ignores the ancient prerogatives of parliament and abuses its executive authority. It makes announcements outside this place and then later comes along to say it needs parliament's approval. After 900 years of parliamentary struggle to give representatives of the House of Commons the power to scrutinize, reject or authorize the spending plans of the crown, this is what we are facing. This is just part of an endless pattern of the centralization of power, the abuse of power and the contempt of parliament, not just by this Liberal government, but its predecessor governments, that increasingly diminishes the prerogatives of this place to authorize spending.

The government might say that it knows for sure that it will get these things passed anyway. How does it know that? The last vote which I was at in this place the government lost. We cannot be certain that announcements made by the Minister of Industry will end up as authorized appropriations by this parliament. There is no certainty in that. To assume otherwise is to exercise a great degree of arrogance.

Also I found it troublesome that the Minister of Industry, that very thoughtful, reflective gentleman and that great contributor to public policy debate in this country, announced this. The Minister of Industry, that great friend of industry, through the Voisey's Bay debacle acted like the dictator of a banana republic by telling a private company that it could not, after having received all regulatory authorization, benefit from its private investment in a major capital investment in his own province. It is an embarrassment that he is the Minister of Industry.

When the minister stood up about a month ago and made this announcement of $750 million for the Canada foundation for innovation, he did so in a context that was completely without any reference in the federal so-called mini budget, the finance minister's political statement of last October and in lieu of a conventional spring budget. He announced nearly $1 billion in new public spending without any broader fiscal context.

We find this troublesome. The fact that he did so at the very end of the fiscal year, which ended this past week, is part of the pattern of spend it or lose budgeting, or March madness, of which this government is a brilliant practitioner. Departments know if they do not fully exhaust money which is on the table or which is available in a given fiscal year, it will be returned and will not be available to them to spend in future years.

The government tells us that this $750 million, and I look forward to questioning representatives of the ministry at committee on this point, will be spent over the duration of something like 10 years. I asked officials in a briefing whether the $750 million would be spent in 10 years. They said “No, something like 10 years”. What does that mean? It is nearly a billion dollars of tax money and the government is not even sure over what duration this will be rolled out.

One thing is for sure. The government wants to book it all in this current fiscal year as part of the well established practice, which has been much criticized by the auditor general, of trying to diminish the size of the surplus in any given fiscal year for political reasons. Then the government can turn around and tell taxpayers that it is sorry it cannot afford to give more real, meaningful tax relief because the surpluses are just not big enough. Year after year we hear this sad story, precisely because the surpluses have been overwhelmingly consumed by huge spending projects and the March madness represented by the announcement which found its way into the bill.

Major spending commitments ought to come before this place in a budget speech in parliament before they are announced by a hyperpolitical minister, like the minister responsible for industry. They ought to be authorized by this place in the context of an overall, long term fiscal plan.

Many private sector economists are agreeing with the official opposition in its assessment that the government's spending program is out of control. Its spending this year will be $35 billion higher than it was projected to be the year before last. That is discretionary spending. That does not include things like the increases for CHST. Spending is out of control.

We see that Canada is headed into choppy economic waters. Growth projections for the current calendar year have been on average cut in half from where they were when the minister's political statement came out in October. At that time he projected a 3.5% growth. We are now looking at an estimated growth of something like 1.5% to 2% this year. That will clearly have an impact on government revenues.

Many economists suggest that in the second quarter of the year, which we are now entering, there will actually be a flat, if not negative growth in Canada. We have a dollar which is teetering on the brink of a near record historic low, having lost 25% of its value under the tenure of the government. Our dollar is now declining against that famed currency, the Mexican peso. The government's reaction is “don't worry, be happy” and that it does not need to bring forward a budget, as is the convention in the House, this spring or even next fall. When the Prime Minister decides by fiat that he is going to deign to come before parliament with a budget he will do so and not before then, notwithstanding that the entire economic landscape has changed dramatically since this government's political statement in October.

Instead of coming before us with a framework to control spending in light of these new realities what does the government do? It presents piecemeal major new spending programs which have not been accounted for in the overall fiscal framework and which have no recognition of the new economic circumstances in which we find ourselves, through the nearly $750 million proposed in the budget.

While we have great consternation about the manner in which this is handled, the amount of spending and the lack of a budgetary authority for it, the official opposition does in principle support the policy objectives of the Canada foundation for innovation. We believe that Canada needs to greater investment in both the public and private sectors in research and development, particularly with respect to hard applied sciences. We have long been an advocate of this kind of policy.

It has been widely remarked that Canada's expenditures and investments in research and development are significantly lower than the average in the OECD and the G-7. This is something we need to correct. Toward that end the Canadian Alliance policy states:

We will appoint a Senior Advisor on Technology with private sector technology experience to report directly to the Prime Minister. We will bring the best ideas in business, government, and universities together to facilitate the transition to the new economy and position Canada as a global leader. We will increase support to Canada's research granting councils and appoint a chief scientist of Canada to co-ordinate science activities in all government departments and ensure that science, not politics, prevails.

We also committed further to that in our election platform an increase in funding for research and development to the various granting councils of some $500 million, an amount far exceeded by the bill before us today. While we believe it is important that both the public and private sectors invest more in R and D, we think that must happen within the context of fiscal responsibility. That means every dollar must be watched with great care.

Another concern that my colleague, the member for Calgary Southwest and critic for science and technology for the Alliance, raised was the manner in which these public moneys were allocated through granting councils, such as the CFI. He interrogated the Minister of Industry on this point at the industry committee, that the government had no clear and impartial framework for granting moneys out of foundations such as the CFI. Also, there was no clear certainty that grants would be done in a completely non-political way and strictly on their merits, as pointed out by the auditor general.

There is no proper reporting on the administration of the grants at research institutes and universities, nor does parliament get proper feed back on the results so we can see what bang taxpayers are getting for their buck.

These are all things that need to be changed. The government constantly comes before parliament or its committees with new ideas about spending on science, technology, research or development. There is a proposal now for major new funding for astronomy. There are various other projects on the table, all which have been dealt with in a piecemeal fashion.

We in the official opposition, and I think my colleague from Calgary Southwest will later speak to in this bill, believe there is a need for a broader framework for funding of science, technology, research and development rather than the kind of political piecemeal approach which we have before us in this bill.

Let me turn my attention to the second section of the bill with respect to the legislation affecting the Canada pension plan investment board and its adherence to the Financial Administration Act.

I find it quite humorous because there are two things that happen in the bill. First, clauses 4 and 5 of the bill clarify the borrowing authority that departments, crown corporations and agencies have. They clarify what we all know ought to be the case, and thought was the case, that parliament delegates to the Minister of Finance the authority to borrow certain sums and he has the delegated authority to authorize or reject borrowing requests from various departments, agencies, boards and commissions.

It turns out that due to typical legislative errors on the part of the government, there are a couple of departments that are not covered by this convention, or legal tradition, of delegated borrowing authority. The Department of National Defence, apparently, had obtained a legal opinion indicating that it had the power to borrow money on its own without any authorization from the Minister of Finance or authorization by parliament. The legal officials in the defence department and the justice and finance departments had a great brouhaha over the past year about whether or not defence department bureaucrats could borrow money without proper legal authorization by this parliament and the minister.

How could we have let that situation get out of control? It is quite conceivable that they could have gone out, done so and contravened a long standing convention of parliament, which is a restriction on the borrowing authority. Because of the government's incompetence and oversights it has taken years to finally come forward with this amendment to tighten up and clarify the delegation of the borrowing authority saying that bureaucrats cannot charge money on the public credit card and tell taxpayers to “pick up the bill, see you later”.

Today it could happen. After this bill it will not be able to but this has stood for far too long without correction on the part of the government.

Then we get to my favourite section of the bill, clause 6. It is really quite marvellous. The government House leader is so proud of his legislative prowess. The problem is that he so often brings bills before this place that are riddled with drafting errors. I spoke about this in debate on Bill C-22. We were making all sorts of corrections to legislation to correct mistakes made in drafting errors in bills brought before parliament by the government.

[Federal-Provincial Fiscal Arrangements Act, April 2nd, 2001]

Mr. Speaker, with reference to the comments made by the Parliamentary Secretary to the Minister of Finance, I note that it was his own Minister of Industry who as premier of Newfoundland said that the government should seriously consider allowing provinces for a period of time not to be penalized through the welfare trap by withholding equalization payments pursuant to growth through non-renewable resource revenues.

I would like to follow up the remarks made by member for South Shore. At the outset they confused me. He said that he was in favour of lifting the ceiling on equalization altogether. That was not a position taken by his finance critic during his opening remarks on the bill. Lifting the ceiling on equalization is a matter entirely different from the substance of his remarks related to non-renewable resource revenues.

If the member wants to lift the ceiling on equalization, the federal government will ask that the floor be dropped, which protects the provinces on the other side. He is treading into very dangerous waters. I encourage him to focus on allowing provinces more flexibility with respect to resource revenues than completely changing the system. We might as well throw the formula out if he lifts the ceiling, as the floor will go and the provinces will suffer.

[The Economy, April 2nd, 2001]

Mr. Speaker, the minister's facts are wrong. Statistics Canada said last week that between 1996 and 2000 Canadian productivity growth was 1.4% compared to 2.8% in the United States, half as high.

Ten years ago the minister's seatmate said to Don Mazankowski:

—will he...bring the value of the Canadian dollar down right now?

The Liberals finally got their wish. Since they have been in power the loonie has dropped its value by 25%. Today it is losing value against the Mexican currency becoming the new North American peso.

Given the finance minister agrees that the value of a currency is a reflection of our productivity, what does this say about the Canadian economy under his watch?

[The Economy, April 2nd, 2001]

Mr. Speaker, last week we learned that Canadian productivity continued to lag over the past five years, coming in at half the level of the United States. This of course is reflected in a further decline in the Canadian dollar again today, which is trading near an all time low.

What is the Liberal response? No budget, no more tax relief and no real debt reduction.

When will the finance minister finally take action to restore value to our dollar and growth to our economy?

[Multiculturalism, March 30th, 2001]

Mr. Speaker, in fact her department did fund International Women's Day. The group that ransacked this cathedral had participated in the parade funded and promulgated by her department earlier that day.

How can this minister stand here as a self-styled defender of tolerance when she spreads religious intolerance and division across the country, when she has been condemned for doing that by the Canadian Jewish Congress, the Canadian Muslim Federation, the Evangelical Fellowship of Canada and the Catholic Civil Rights League, and when her own department supports marches that lead to this kind of violent anti-religious bigotry?

[Multiculturalism, March 30th, 2001]

Mr. Speaker, the disgraced Secretary of State for Multiculturalism is so busy imagining cross burnings that we find it hard to believe she did not notice a quarter page picture in a national newspaper of four crosses being burned in front of a major Catholic church in broad daylight in Montreal a year ago.

Perhaps the minister just did not notice this because she is the same person who disgraced Christians by saying that a basic tenet of Christian faith is bigotry. How does the minister have any moral authority to criticize this anti-Christian bigotry when she perpetuates it herself?

[Income Tax Amendments Act, 2000, March 27th, 2001]

Mr. Speaker, not only was it not a point of order. It was completely inaccurate. Our platform included a policy for a single rate of tax.

I will make clear what I was saying. People are confused by competing claims about whether taxes have been cut. They can be the arbiters. They have very simple documentary evidence to adjudicate the test. It is called their paystub.

I invite everyone listening to or watching the debate to look at their paystubs and compare them to the paystubs for the same week or month last year. They will see that the supposed Liberal tax cut for this year was actually a tax increase. It is bogus.

When we combine the impact of Bill C-2 regarding Canada pension plan payroll taxes, which was passed during this fiscal year by the previous parliament and is the largest tax increase in Canadian history, with the myriad of other tax increases imposed by the government and the snail's pace at which its modest tax cuts will apply, Canadians at most income levels will find they are paying more than they did the year before.

If they are not, it is because of the foresight of provincial governments. Provincial taxes in Ontario and Alberta have gone down, thanks to the leadership of people like Mike Harris and Ralph Klein, but federal taxes have stayed the same or gone up.

The finance minister and his parliamentary secretary claim the bill includes $100 billion of tax relief. A nice round figure like that is like pricing something at $9.99 in a department store. The finance minister was told by campaign officials to get the number up because he needed a nice, big round number to talk about in the election. They decided it would be $100 billion. It is nothing of the sort.

The government claims $100.5 billion of gross tax relief in the bill and $3.2 billion of that is an increase in spending. The government has taken the Canada child tax benefit, which is an entitlement program and a spending program, and booked it as a tax cut. Once again the paragons of clean accounting in the government opposite are misleading Canadians.

Then there is the $29.5 billion by which the government increased the Canada pension plan payroll tax. The government, after enormous pressure from this party, from the Canadian Taxpayers Federation and from the Canadian people, finally decided to stop the insidious back door tax grab on inflation known as deindexation. Under deindexation people were bumped into higher tax brackets and paid more taxes. They did so because they were getting cost of living adjustments and not because of any real increase in income.

The Canadian Alliance objected to deindexation. Finally the government responded to our objection and stole our policy by agreeing to reindex the tax system, but not retroactively to 1986 when the Mulroney government deindexed the system.

Let me say parenthetically that the Liberal Party in the 1988 and 1993 elections ran against the Tory Party, and rightfully so, for having deindexed the tax system in 1986. However when it finally came to setting things right, did the Liberals give back the money that had been stripped out of people's wallets by taxes and inflation since 1986? No, sir. They reindexed. They did not give back the some $9 billion that people had lost to deindexation.

The Liberals say they will adjust tax brackets, exemptions and credits upward to account for the consumer price index so that they no longer impose a tax on inflation. That is good. However they count that as a tax cut. In other words, the government counts a non-increase as a cut. They tell Canadians they will not tax them on inflation and that Canadians should be grateful it will be counted as a tax cut. There are accountants in this place who would find that pretty specious. The government has declared $21 billion worth of specious, non-existent tax cuts which are merely non-increases.

When we add all that up, the real total net tax cut in the government's bill is $47 billion over five years. That is about half the tax relief proposed by the Canadian Alliance over five years based on comparable accounting. It is a fraction of the tax relief proposed by U.S. President Bush of $1.6 trillion to $2.3 trillion, depending on how we count it, over 10 years for a country with taxes that are already lower.

That would not be such a problem if Canada had its tax burden under control. However it does not. Revenues to the federal government last year were at their highest level in history. The government is bigger in terms of the money it hoovers out of people's wallets, purses and small business tills than any government in the history of the dominion. Personal income taxes in Canada consume a higher percentage of gross domestic product than in any other nation in the G-8. At 17.6% of GDP we have the highest personal income taxes.

According to a recent study by Price Waterhouse that was published in The Economist , Canada has the highest corporate income tax rates in the OECD, the Organization for Economic Co-operation and Development, the 23 principal industrialized countries in the world. Of those 23 countries, yes, we are number one when it comes to business tax rates.

When we look down the line, we see that none of this will change under the bill. When the tax cuts here have been fully implemented, and after the Bush tax changes have been implemented in the U.S., Canada will still have income taxes far higher than those of the United States and our other principal competitors. That is having an impact on our competitiveness and our standard of living. We know that.

We know that Canadians are working harder now than they ever have and are falling behind. We know we have an increase in the brain drain: the loss of talent and human capital to the United States and other jurisdictions, in large part because of the tax burden.

We know that Canada has fallen from second to 16th place in the OECD in terms of our standard of living over the past 15 years. We went from the second highest per capita GDP to the 16th, to the middle of the pack. Over the past 10 years, by comparison, Ireland leapfrogged over Canada in terms of its growth in per capita GDP, which is the best measure of increases in the standard of living, in large part because it provided huge tax incentives.

A member opposite said that it was because of something other than tax relief. My brother moved a company with 30 very well paying jobs to Dublin because of the tax cuts offered in Ireland and the huge advantage it offers over Canada.

This is not an agenda that would restore the competitiveness of the nation. It would continue to impose on Canadians an enormous burden of taxation into the future.

The bill would do a number of other things to which we object. First, there are a couple of elements which do step in the right direction. Reducing the inclusion rate on capital gains to 15% is something that should have happened a long time ago. We would like to see that inclusion rate go down to 33 1/3% so that we stop penalizing people who invest their whole lives in a business or in a property. This is a form of a death tax. We work hard our entire life, we invest in a business or property and we look forward to passing that on to the next generation. We, as individuals, may not take any benefit from it, but guess what? The moment we die, the Government of Canada comes in with deemed capital gains, which is really a form of estate tax or death tax, and grabs one-third of our lifetime earnings that were in that investment. That is wrong. We should not penalize people's lifetime investments. We should not diminish their abilities to pass on to the next generation their life's savings as we do through deemed capital gains.

There are a number of technical changes in the bill. One of the technical changes with which we have a great deal of trouble is the fact that the bill would continue the unfairness with which single income families with children are treated under the tax code.

The House will recall that this was a very hot issue at one point in the last parliament. The Secretary of State for International Financial Institutions, in response to a question I put to him about why the government discriminated against single income families with kids and why there was as much as an 80% tax penalty for those families versus their dual income counterparts, stood in his place and said that the government discriminated against single income families because they did not work as hard or have as many expenses as the double income families. That was pitting one kind of family against another.

As we said then and I say now, let me inform the secretary of state that moms and dads who stay home to raise small kids, to care for the elderly and the infirm, and to build families and homes, work just as hard, if not harder, as those of us in the paid workforce. They deserve and demand our respect and fairness in the tax code.

The current tax code's discrimination against those families must be eliminated and fairness must be brought in. The Canadian Alliance has proposed, among other things, equalizing the spousal or equivalent to spouse basic exemption with the basic personal exemption.

Under the bill we would have two classes of citizens: those who are primary income earners and their spouses. They have equal worth and that worth should be reflected in the tax code by a spousal exemption equal to the basic personal exemption. That would not done here. We would continue to penalize the stay at home parents.

We would raise that exemption from $8,000, which it will eventually get to pursuant to this bill after several years, to $10,000. That would lift hundreds of thousands of working families off the tax rolls so that instead of giving money to be misspent by the government they could invest it in their own priorities, their own children and their own homes.

We would bring in a child tax deduction. We would provide a deduction of $3,000 per child so that families with children would be able to keep more of what they earn to reflect the costs of raising kids.

What does the government do? Absolutely nothing of the sort. To the contrary, the bill before us raises the so-called child care expense deduction from $7,000 to $10,000. This is another piece of discrimination because only certain families would get to claim the child care expense deduction. Only those dual income families with receipted child care expenses could make use of it. Only 17% of tax filers could claim this deduction, and even a smaller fraction could claim it to the full amount.

If a mother with three children is the main income earner and the father decides to stay home until the kids are in school, the tax code says that the dad's work at home cannot be deducted. The tax code says that it has no value to society and therefore will not be recognized. However, if a parent decides instead to earn a second income and drops the kids off at a day care on the way to the second job, the federal government will give recognition for the third party costs of child care. The at home costs, the opportunity costs, the forgone income and the real financial costs of raising children at home are recognized nowhere.

It is intolerable that we should be increasing discrimination against single income parents. We will oppose the bill on that ground alone.

The bill includes an element which further erodes parliament's recognition of the unique and important role and status of the institution of marriage in our society and culture. It does so by bringing forward further amendments to change any reference from spouse to common law partner.

This is a change which was begun in a bill amending the Income Tax Act in the previous parliament, but in one of the many drafting errors to which I referred earlier the officials neglected to amend certain sections of the bill, saying that in various sections reference to spouse as part of the institution of marriage has been abolished for all intents and purposes from the Income Tax Act. It is an institution which in this and every other society I know of has been given certain privileges because it is the basis of the family, the basic institution of society.

We have said from time immemorial that the institution of marriage should be given certain preferences and privileges to protect the family. The bill would further erode the distinctiveness of that institution by saying common law partners, not spouses.

We as a parliament or as a country should not be ashamed of declaring that the spousal commitment in the covenant of marriage is a fundamental contractual relationship in the development of strong and healthy families and that they are necessary to having a strong and healthy society.

That is another reason we oppose the bill. It further undermines and weakens marriage as an institution.

There are a number of other provisions in the bill which the Alliance finds objectionable. It does include certain technical changes to which we do not object. Here is an interesting one: the foreign actors' tax credit. Most people may ask what that is all about. It turns out that we currently withhold 15% of the income of Hollywood actors who come to Canada to act in Hollywood movies. We then reserve the right to force them to file a tax return and tax them even more.

The Hollywood movie actors have been shedding crocodile tears about this unfair tax treatment by Canada. The same government which cannot find the fiscal room to help out single income families, has decided to give millionaire Hollywood movie actors a tax break in the bill. Lo and behold, Sylvester Stallone and Bruce Willis will be at the front of the line when it comes to tax relief from the government. Single income moms and dads can stay at home without fairness.

The government would do this by raising the withholding tax from 15% to 23%, a very modest increase, but then it says that the actors would not have to file returns beyond that. These are people making millions of dollars at the highest possible marginal rates.

My office staff called the movie producers, the Hollywood actors, the actors' guilds and so on to hear what they thought of this move by the government. They were in favour of this because it would be a big tax cut for the millionaire Hollywood movie stars. They said that if we did not make this change, they might not keep coming back to work in Canada. I find it very odd when I look at the priorities that the government has for tax relief.

We in the Alliance have talked about raising the basic exemption for individuals and spouses, or equivalent to spouses, to $10,000. We talked about introducing a $3,000 deduction per child. Let us just figure out what that means. If we had a Canadian Alliance government, it would mean that a family with two parents and three kids would pay no taxes on their first $29,000 of income. It would mean that a single mom could give her first child the equivalent to spouse deduction of $10,000, so that a single mom with two kids would have $23,000 tax free.

These measures would lift 1.4 million low income Canadians off the tax roles altogether, giving them a hand up so they could get ahead. It would stop penalizing them for earning that small incremental income to try to get ahead economically. The government does nothing in the bill to lift Canadians off the tax roles.

When our party came out with its bold and powerful proposal to eventually get to a 17% single income tax rate and lift 1.4 million low income people off the tax roles and to restore and create family tax fairness, the government said that it looked popular. It said that it was testing well in the polls so it had better try to outflank the opposition. What did it do? It came up with a new basic rate of 16% in the bill and thought that Canadians would be fooled by that because, after all, 16% is lower than 17%.

Yes, it is. However, for the people, for whom it matters, those at the lowest income levels, there are no increases in the basic exemptions and deductions. Those are far more generous. What the Liberals want is for a single mom working as a waitress to pay 16% of her paltry income. Our plan would say that a low income individual would pay no taxes at all because we want that individual to get ahead through higher deductions and exemptions at the bottom end of the tax system.

In closing, I encourage the government to think about the enormous complexity of the Income Tax Act and the destructive effect it has on our economy and our society. It should think of the tens of thousands of bright, young Canadians, whose educations we subsidize, who leave the country every year to pursue their economic opportunities elsewhere in large part because of diminished opportunities and our tax system.

I want them to think about the low income working families, the single moms and the seniors on fixed incomes who are forced to pay taxes today. I want them to join us in dreaming about creating a tax system which is simple, fair and low, which rewards risk taking, investment and productivity and which rewards the virtues upon which a prosperous society is built.

I want to invite them to join us in the opposition in proposing a tax system that lifts the low income people off the tax rolls, that puts the family first and restores fairness to the tax system and that stops the beggar thy neighbour, class warfare politics of envy approach, which informs the so-called progressive tax system that penalizes people who succeed, work hard and get ahead.

I invite them to do all of those things by opposing Bill C-22, a bill that once more adds yet another destructive layer on to the tax act which was first passed in this place in 1917. I hope they will join us in doing that and working together to create an economic environment of opportunity which rewards risk taking, saving, investment and hard work. That is what Canadians are asking for and that is what we are fighting for by opposing the bill.

[Income Tax Amendments Act, 2000, March 27th, 2001]

Mr. Speaker, congratulations on your elevation to the Chair. I am pleased to rise to debate Bill C-22 which is, as the hon. Parliamentary Secretary to the Minister of Finance has indicated, a very substantive tax bill which appeared before this place in the form of a ways and means motion several days ago in the session. It seeks to give effect in part to tax changes proposed by the hon. Minister of Finance in his economic political statement here before the dissolution of parliament at the call of the election.

Let me say at the outset that the bill before us is a classic example of what has gone wrong with parliamentary oversight of legislation, particularly with respect to taxation. The bill before us has some 513 pages of technical amendments. I can say with a fair degree certainty that not a single member of this place, let alone the parliamentary secretary who just spoke or the minister he represents, has read or will read. It is a bill that exercises enormous power over the lives of Canadians through the Income Tax Act which in itself has coercive powers delegated to it by this parliament. The some 500 pages of amendments in the bill are amendments to a tax act which runs over 1,300 pages long.

Let me remind my hon. colleagues that in the House in 1917, before it burned down, this same parliament passed what was called the temporary Income War Tax Act. It ran all of seven pages. The government of the day of then Prime Minister Borden said that the bill was only necessary for a short period of time to finance the war effort during the great war and that we would be able to repeal it shortly thereafter. This was an income tax which applied only to very wealthy Canadians at the time, people who were in the top fraction of income earners. The vast majority of Canadians were unaffected by it. The politicians said that it was temporary and that would be repealed.

This does not look like a repeal bill to me. This looks like another 500 pages of amendments on top a 1,300 page statute of which I doubt a single person in this country understands the totality. There might be a tiny handful of tax experts in academia or in the Department of Finance who have even a vague grasp of the myriad complexity of the Income Tax Act which we are seeking to amend today. This is a testament to the enormous complexity of the tax code with which Canadians must grapple every day.

That act in 1917 was passed in good faith by parliamentarians and committed to the Canadians, who they were taking money from to finance the war effort, that it would be repealed. It was not. Not only was it not repealed, it was added to, broadened and expanded to bring more and eventually every single working Canadian into its ambit.

Today we end up with an enormous, complex web of tax laws which inhibit the wealth creating potential of this nation which diminishes our productivity. It drives down our competitiveness and undermines the standard of living of Canadian families who are working harder to get ahead but who are falling behind because of the tax act which the bill seeks to amend.

Let me say as a matter of principle on behalf of the official opposition, the Canadian Alliance, that we stand four-square against this huge complex and destructive system of penalizing work, investment, risk taking and wealth creation. These are the very virtues and habits upon which a prosperous and free nation is built. All of those things are undermined by taxation in general and this extraordinarily complex tax system that we have in this country.

A political philosopher once remarked that the power to tax is in fact the power to destroy. It is the power of government to use its monopoly on coercive force to reach out the hand of the state and to take from individuals, businesses and corporations the fruits of their labours. We can never underestimate just how destructive that power can be. We can never know how many small businesses or how many dreams have been vanquished because people were unable to realize their potential and dreams of starting up and operating a successful business because they were unable to keep enough of the fruits of their labours to keep their heads above water. That is what the bill represents.

I am sure the parliamentary secretary who just spoke perhaps does not reflect often on the first principles of taxation. It is important for us every now and then in this place to remember the enormous power that we wield through this taxing power. We do so somewhat recklessly. As I suggested, I am certain that not a single member of the House has now or will read the entire bill.

I tried to make my way through as much of it as I can. I consulted the experts in the finance department. I received the bill a couple of days ago and I am supposed to stand here on behalf of the official opposition, which has a quasi constitutional obligation to be the watchdog of the government particularly with respect to issues like this, and provide a thorough, detailed, thoughtful analysis and assessment of the bill, when these 500 pages of technical amendments were just delivered to us.

I know for certain that the finance minister not only has not read the bill, he is likely at best vaguely familiar with the impact of the amendments contained herein.

Even though the official opposition will vote against it for a number of reasons, this will undoubtedly go on to the finance committee which, I predict, will have fairly brief hearings because none of the members will be able to penetrate the impenetrable complexity of the Income Tax Act.

Well meaning and very bright officials from the Department of Finance will appear before the committee to explain and analyze, as best they can, the impact of the bill. The committee members, who were elected to represent the best interests of their constituents and to uphold any parliamentary oversight and scrutiny, will have to take the bureaucrats at their word and then the bill will come back to this place and be passed.

Members will not understand what they have passed because of the complexity of the act. That is a very serious concern, but it does not need to be that way. In a more functional democratic institution, the American congress for instance, both the upper and lower houses have ways and means committees with independent legislators and adequate staff resources. The staff of those committees have become experts on the complexities of tax legislation and are able to frame and craft bills of this nature with a real understanding of what they are doing. The U.S. congress has specific committees to deal with taxing power and taxing legislation.

As a result, congress and the people it represents have the benefit of real, serious, substantive democratic oversight and input into tax legislation. We only pretend to have such input in this place because of the dysfunctional nature of parliament and the complexity of the Income Tax Act.

How do I know that is the case? How can I prove that the consideration of tax legislation does not work in this parliament? It is very simple. This bill, and at least three other bills before the House right now, include amendments to tax legislation that seek to undo the drafting mistakes of previous bills passed by parliament. It is unacceptable that we waste the valuable time of parliament time after time by undoing mistakes made in the drafting of legislation. Those mistakes were not identified by members of parliament because they do not have the expertise, the time or the resources. What is the point of digging down into the depths of a bill if it will be passed anyway?

We do not have time to ensure at a meaningful level that the bureaucrats have it right. The minister does not do that. He receives draft legislation from bureaucrats, rubber stamps it and sends it to parliament. We ought not spend time correcting the errors that drafting officials and bureaucrats have made. If we had more serious parliamentary scrutiny, oversight and involvement in the development of tax legislation, and a tax code which made sense to ordinary taxpayers, we would not need to constantly revisit bills such as the one before us.

For those reasons my party stands four square for the reform and simplification of the tax code. I will quote from the Canadian Alliance policy declaration. It was not dreamed up by any one person. It was the result of a grassroots, bottom up democratic process. Our members agreed that:

We will restore public confidence in the fairness of the Canadian tax system by reducing its complexity. We will restore indexation and move towards a simpler tax system, built around—

This is a novel concept for a government which likes to play the politics of envy and class warfare. It continues:

—a single rate of taxation to ensure lower taxes for all Canadians. We believe that all Canadians above a minimum income level should share in the cost of the services provided by government, which benefit us all.

That is what we seek to do.

The hon. parliamentary secretary suggested the bill would give effect to what he called, disingenuously, the largest tax cut in Canadian history. That is absolutely bogus. He argues the bill would give effect to the political statement made by the finance minister in October.

Let me give credit where it is due. After seven years of advocacy in this place by the Reform caucus and then the Canadian Alliance that tax relief be our nation's highest economic priority, and after millions of Canadians demanded to see a little more of what they earn and said they were fed up with Liberal tax increases, the finance minister, days before an election, finally came forward with some modest tax cuts.

However they are not real tax cuts for real people. I challenge people to take the paystub test. People who watch the debate in this place see me and my colleagues stand to demand the finance minister cut taxes and they see him stand to say he has already done so. How are people to know which of us is telling the truth? I have a very simple test.

[Summit Of The Americas, March 27th, 2001]

Mr. Speaker, I will do something a politician does not often do, which is to admit my ignorance with respect to the maritime element of the softwood export industry with regard to the United States. I cannot intelligently comment or respond to his questions and I will not attempt to do so.

I will say, however, that we are four-square for free trade in lumber generally because the countervailing measures the Americans are about to impose would be very detrimental to tens of thousands of working Canadians, including many members of unions who no doubt support my hon. colleague's party.

Regarding his assertions with respect to Mexico, my understanding is that living standards and incomes have risen as a result of the free trade regime. Indeed, Mexicans recently elected, in the first really vibrant democratic election in their history at the national level, President Vicente Fox, a strong champion of free trade, who will be at the FTAA summit in Quebec City and will later travel to my own home city of Calgary.

President Fox was elected in part by the Mexican people because they saw his advocacy of freer trade, less protection, less regulation, better multilateral relations within the hemisphere and bilateral relations with the United States as an integral part of paving the way to prosperity for that country. Mexicans had a choice in their election.

The hon. member's colleagues talk a lot about democracy and suggest that the FTAA somehow undermines it. When it comes to the Mexican people making a sovereign, democratic decision, and the most significant democratic decision in their modern history, they chose a free trader. They chose an advocate of the FTAA.

I do not suggest the member for Sackville—Musquodoboit Valley—Eastern Shore is guilty of this, but I do believe there are some in this place, and in the country, who are guilty of a paternalistic attitude toward people in the developing world, that they do not know what is best for themselves.

The Mexican people spoke pretty clearly about what they thought was in their best interests in a democratic election when they endorsed President Fox's agenda for free trade and economic growth. If we are truly committed to democracy, rather than throwing Molotov cocktails at police in Quebec City, we should listen to the citizens and the electorates in the developing world who are choosing democracy, free markets, free trade and rejecting closed economic systems that have failed them for too many decades.

[Summit Of The Americas, March 27th, 2001]

Mr. Speaker, thank you for your forbearance and that of the House officers and servants of the House in making it possible for myself and colleagues to continue this important debate on the upcoming summit on the free trade agreement of the Americas.

I point out at the outset that this is an important matter, so important that indeed the government itself placed the issue before the House in the form of a take note debate. Yet I am discouraged to report that it appears evident that far more members of the opposition parties, which represent 40% of the seats in the House, will have participated in the debate than members of the very government that brought it forward. That reflects in part, I think, the esteem in which members of the government, with the very notable exception of the member for Yukon, hold this place as a chamber of democratic deliberation.

Canadian Alliance members have been very active in articulating their views about the positive elements of free trade and the impact it has on democracy. I make special note of the very committed participation in this debate of the small but spirited and thoughtful contributions from the members of the New Democratic Party caucus, with whom I disagree for reasons of principle. However, one cannot question their willingness to use this opportunity to express their very genuine concerns about this upcoming summit and the agreement which it will conclude in.

Many members of my party have outlined our general support for the principle of free trade and the objectives of the upcoming summit. However, let me just say as a matter of first principle that we often take for granted the incredible wealth of our society. We hear Liberal politicians say, almost as a truism, that Canada is the finest country in the world in which to live and I concur.

One of the principal reasons it is such a great country in which to live is the high degree of economic development that has resulted largely from a system of free markets. As well, as a country that is an enormous exporter of goods and services, we benefit enormously and are enriched as a nation by trade across the world, particularly with nations within this hemisphere and in particular the United States of America.

We do take for granted this level of development. We ought to occasionally reflect on the fact that today an average Canadian middle class family enjoys a standard of living that is virtually inconceivable for most of the world's population, most of the population of the western hemisphere and certainly most of the people who have ever lived throughout history.

Middle class Canadians, people of relatively modest means, enjoy goods and services, comforts and security, life expectancy and health, a level of education, disposable income and political freedom which is in the long context of human history almost unparalleled.

It would be fair to say that a middle class family today enjoys greater economic benefits, in many respects more luxuries, than a Tudor king would have 500 years ago or a Roman emperor 2,000 years ago. We should think how tremendously we benefit from the advanced standards established by the free market system and the free trade system upon which it is predicated.

In the past couple of centuries the countries of the west, particularly northern Europe and North America, have seen by far the fastest rate of growth in the standard of living, increases in life expectancy, human health and wellness of any time in history. That again is because of the system of trade which has allowed for efficiencies in national economies by exchanging the value of the goods which they produce.

One of the leading contemporary political theorists, Michael Novak, wrote a brilliant book entitled The Spirit of Democratic Capitalism in which he attempted a theory to explain this tremendous political and economic freedom from which we benefit in this and other similar western societies. He said that democratic capitalism stood on a three-legged stool.

Those three legs consist of first, a free market system predicated on private property and its entrenchment, and on the principle that people has a right to possess and retain the fruits of their labour.

Second, it is predicated on a political system which itself is based on a conception of the human person which see the human person as possessing an inviolable dignity created in the image and likeness of God and, because of this inviolable dignity, entitled to self-government and a free democratic political society.

The third basic foundation of democratic capitalism according to Michael Novak is a moral culture based on virtue where the tendency of human nature to pursue one's best interests in the marketplace or in the political sphere is tempered by the moral impulse to try to be virtuous. He said that these three things together were what have created a society with unparalleled wealth, prosperity and health.

As a matter of principle, and as the hon. Leader of the Opposition said earlier today in his remarks on the motion, it is important that we make the moral case for free trade. There are some 800 million people in this hemisphere, roughly 300 million of whom are participants in this cycle of prosperity. However the vast majority of them live beneath what we in Canada would consider the poverty line and live with limited economic opportunities.

We should be generous and bring those people into the cycle of prosperity through trade, allowing them to sell to us the goods that they produce, the services which they provide and similarly to benefit from the additional economic choices and efficiencies from goods and services which we can export to them. That is what the free trade agreement of the Americas is all about. It is about expanding the cycle of productivity and hence prosperity to all 800 million inhabitants of this hemisphere.

We know there are many hysterical voices suggesting that this represents some hidden agenda to undermine democracy. Many people with this point of view will be gathering in Quebec City engaging deliberately in campaigns of civil disobedience to disrupt the summit.

How dare these advocates of civil disobedience claim to represent the people and the civil societies of their respective countries and of Canada in particular? Canadians who will be attending the summit in protest and who have been funded, shockingly, to the tune of $300,000 by the government in the so-called people's summit, represent a point of view so marginal that it obtains virtually no meaningful political support in the democratic elections of the country.

With respect to my colleagues in the NDP, their party received 8% or 9% of the popular vote in the last general election, I believe, meaning that over 90% of Canadians rejected their message of protectionism vis-à-vis trade.

I say in closing that those opponents of the agreement have no legitimate right to claim to be the champions of democracy. Each of these national governments is accountable to its electorate. As we continue to increase economic prosperity we will create a middle class in these societies which will increase the stability of democratic institutions and democratic accountability. That is the virtuous cycle into which we should invite all of the nations in the western hemisphere.