Leon Benoit

[Supply, June 7th, 1995]

Mr. Speaker, on the Canada social transfer, he said they are transferring $35 billion to the provinces. He forgot to mention that is a reduction of about $7 billion, if I have my figures right. That is downloading on the provinces.

Maybe that is the reason the Liberals in Ontario's provincial election are into a skid. Maybe it is that and Bills C-68 and C-41. Maybe that is why this Liberal Party got so desperate as to campaign for its provincial brothers and sisters during members' statements before question period, and it does not even claim them as an election expense.

[Supply, June 7th, 1995]

Mr. Speaker, I want to make a couple of points.

First, I would like to try to distance his comments from the Prime Minister who was finance minister as these deficits started increasing dramatically. If the member would at least acknowledge that an error was made at the time and that the

government was going to try to correct the error, he would be moving in the right direction.

The second point is that to make a statement that the government has lowered its spending is totally out of line. Spending in this budget, by the government's own figures, has increased by about $1.5 billion. Therefore, let him be accurate about the budget. I would think this member would know this.

[Canadian Dairy Commission Act, May 16th, 1995]

Madam Speaker, I agree with the hon. member for Frontenac that Canadian dairy farmers could increase production very rapidly. If Quebec were to become independent and leave Canada I believe that the rest of the country could take up the production that Canada would lose very quickly. Alberta and western Canada would love to be able to improve dairy production.

They do not want Quebec to leave so that will happen. They have other plans for allowing for the increase in dairy production.

There is an understanding that the present system of levies is not GATT friendly. I ask the hon. member if she is completely confident that this bill cannot be challenged successfully by the World Trade Organization?

[Canadian Dairy Commission Act, May 16th, 1995]

Madam Speaker, it is with enthusiasm and some trepidation that I lead the debate for the Reform Party on the future of supply management and the dairy industry in Canada.

The enthusiasm comes from my belief that there could be and should be a bright future for supply management and particularly the dairy industry in Canada.

The trepidation I feel is for two reasons. First, if the changes in the dairy industry are handled poorly or badly everyone involved in the industry will suffer. Second, I have less of an understanding of the dairy industry than I do of many other areas of agriculture. I have been working hard with the help of dairy farmers and groups that deal with dairy farmers to improve my understanding and I will certainly continue to work on this.

Today we are debating Bill C-86, an act to amend the dairy commission act, but our debate must go beyond the bill to a discussion on the very future of supply management and the dairy industry.

I will debate the bill by summarizing it and how it will affect the dairy industry and discussing the future of the dairy business in Canada as I see it with input from farmers and groups I have talked to. I will do this by discussing Liberal policy on supply management from the red book and later added to the red book in an appendix. I will discuss it by talking about the Liberal position as presented from two other sources. I will refer to these sources later.

Bill C-86 is an act to amend the Canadian Dairy Commission Act. It was given first reading on April 28, 1995. The purpose of the bill is to amend the Canadian Dairy Commission Act to provide for a replacement of the existing system of levies with a system of pooling market returns from different classes of milk.

The government claims the switch to a pooling system will maintain equity among producers and is consistent with Canada's international trade agreement.

I have some background information. As part of Canada's system of supply management, the Canadian milk supply management committee, chaired by the Canadian Dairy Commission, oversees the application of the national milk marketing plan.

The CMSMC sets national production targets, establishes each province's share of the national quota and exports any surplus milk through planned marketing programs. The orderly export of surplus production is an essential element for ensuring the integrity of the supply managed system. Without it the system would falter.

Currently producers assume the cost of exporting dairy products not consumed in Canada through a system of levies collected by provincial marketing boards and agencies as deductions from payments to milk producers. Once remitted to the commission these levies are used to finance special programs intended to increase the domestic use of dairy products and to cover the commission's administrative costs.

During the 1993-94 year a total of $141.5 million was collected from the industrial and fluid milk sectors. Such levies, however, are now considered to be a form of export subsidy under the new GATT deal and must be reduced or modified.

Through the bill Canada's dairy industry would abandon this established system of producer levies on industrial milk. The levies will be replaced with a system of national pooling which allows all stakeholders, including farmers, processors and the commission, to equitably share the costs and benefits of pooling revenues and the effects of fluctuations in market size for both fluid and industrial milk.

Through a system of pooling the producers who export milk into the U.S. would receive smaller returns for their milk but the burden would still be shared by all dairy farmers. Basically instead of a levy taken off farmers' cheques to subsidize exports, the national pool would achieve the same ends since the net return to farmers would be in theory identical.

For its part the processing industry would still pay lower prices for its industrial milk. These amendments to the Canadian Dairy Commission Act add a certain amount of new pricing and funding distribution authority to the Canadian Dairy Commission. The new pricing and pooling approach for milk has

received agreement from all provinces in principle. However, negotiations are ongoing as to whether there will be one national pool, which at the moment appears very unlikely, or two separate pools. There would possibly be one for B.C., Alberta and Saskatchewan, and we do not know about Newfoundland, and another for the other six provinces.

Ontario dairy farmers supply most of the industrial milk to further processors and Quebec dairy farmers are the biggest exporters. They would receive less than other dairy farmers unless there is some form of national pooling. On the other hand, under a national pooling system producers in the other non-exporting provinces subsidize those who are exporting. It really amounts to a form of equalization payment from one sector of the industry to another or from one province to another. This is perhaps the biggest obstacle to achieving agreement on establishing one national pooling regime for all classes of milk.

I would like to talk about the Reform Party's policy and position relating to Bill C-86. Reform policy in this area has four main points.

First, all processors will be able to structure and manage their organizations in any manner they believe will best serve their interests. The matter of regulating production and setting prices for products under the organization's jurisdiction is a producer issue and should be dealt with by producers.

Second, Reformers acknowledge that the agriculture industry, including supply managed sectors, is moving toward a more competitive market driven system.

Third, we have proposed tough positive measures to ensure fair competition. These are measures such as a tougher anti-combines legislation. That would lead to lower input prices and fair trade policies which would help protect against dumping from other countries particularly from the United States. It would help to protect Canada from the effects of high subsidization in other countries in particular the United States.

Fourth, Reformers propose general changes which will reduce government overspending in a general way but through that will reduce input costs to farmers and indeed to other business people.

We presented these measures before the election campaign, during the election campaign and most recently in the taxpayers budget which would lead to a balanced budget over a three year period if implemented. It would be good for all businesses, including the dairy industry.

In February I visited with farmers in the Niagara peninsula. They spoke of three options. These three options have been presented many times since from a variety of groups. For example, a group of dairy farmers and veterinarians who were in Ottawa a couple of weeks ago wanted to discuss the issue of the BST, but also other dairy issues. These options were presented from dairy farmers in my constituency and across the country both in person and by letter.

The three options concern the future of supply management in the dairy industry. The first option is to end supply management now. I do not believe that this is a widely accepted option within the dairy industry. The second option is to start preparing. Recognize the reality and start a transition process which will allow a healthy dairy industry to continue down the road. The third option is to keep supply management as it is.

The third option clearly is not a reality. Unfortunately it is the position this government presents at least in public. It chooses to go down the avenue of least resistance. It would be appropriate now to look at what happened to grain farmers in western Canada because past governments have chosen to go down the road of least resistance.

I am talking about the elimination overnight of the Western Grain Transportation Act subsidy, the old Crow benefit. Due to the lack of openness, honesty and action on the part of previous Conservative and Liberal governments, no phase-out period was provided. There is no clear direction on how farmers will deal with the loss of the freight subsidy. There are no changes in place or proposed by government which would allow efficiencies to be put in place within the grain handling and grain movement system. There are no changes which would allow lower input costs in other areas. Many grain farmers in western Canada will go out of business over the next few years because of the loss of this subsidy, particularly the loss without a transition period for crops which are now being seeded in western Canada.

Governments have talked a lot over the past several years about stabilizing the agriculture industry, but their moves have led to chaos, not stability.

Of these three options, the second option is the option which the Reform Party supports and believes is most realistic. Use what time there is left before we move to open competition in the dairy industry to help prepare for the changes which will come in a supply managed industry. Let us not take the bury your head in the sand approach which has been taken by the government.

Let us look at the reality of the situation in supply management. First, let us look at the GATT and what it does to supply management in the future. After the year 2000 new negotiations will begin regarding supply management through the GATT. In the new negotiations there will be a rapid reduction in tariffs. Those tariffs are presently high and protect the supply managed

industry quite well. There will be more access to imported dairy products in this country.

The changes to the GATT starting a short five years from now will have a huge impact on dairy farmers. That leaves precious little time for farmers to prepare for these changes.

I believe that the real open borders, particularly between the United States and Canada in supply managed products and in dairy products, will come through new NAFTA negotiations. A lawyer for the Dairy Farmers of Canada, which of course is arguing that the GATT supersedes NAFTA in guiding supply managed industries in the Canada-U.S. trade agreement, said in a Western Producer article: ``The Americans have a strong case in arguing that NAFTA supersedes and that dairy farmers should be preparing for this possibility''.

Further, a very significant event happened when our Prime Minister and U.S. President Bill Clinton announced a few months ago that Chile would be a part of the NAFTA deal within four years. Why is that significant? It is significant because the Americans, who are looking for and pushing Canada in every way they can for more access to our supply managed markets will not sign a new NAFTA deal until they have much more access to the Canadian market in milk and dairy products. That will mean that in less than four years the supply managed industry in Canada will have to move to a much more competitive environment.

The government can pretend that it will protect supply management through this process but it cannot. I will demonstrate this with quotes from three sources, from the red book first. I will quote all of the agriculture policy in the red book; it will not take very long. This is how important agriculture is and was to the Liberals when they drafted the red book. This is their complete agriculture policy:

The Canadian agri-food sector has a unique opportunity for growth. An overall policy for the agri-food sector must build upon three component strategies: developing new domestic and international markets for Canadian food products; reducing input costs to make farming more viable; and introducing a new "whole farm" income stabilization program. Liberals believe that farm families need long term programs to assist them in securing their future, so that they can continue to provide Canadians with the best quality food in the world.

The red book goes on for one more whole paragraph to conclude the Liberals' agriculture policy:

Canada's agri-food industry needs policies and programs such as supply management, the Canadian Wheat Board, and stabilization programs to minimize the impact of market price fluctuations; government support in developing new commercial markets for commodities in which the agri-food industry has a competitive advantage; sustainable agriculture practices to maintain and improve the quality of our land and water; and mission oriented research to increase productivity and create quality products to meet market demand.

That is the entire agriculture policy that was included in the Liberal red book.

There was a very secret appendix that was even more difficult to get than the red book itself during the campaign and since. It was quite difficult to get. The appendix goes on for three more paragraphs regarding supply management. Three whole paragraphs. That is the extent of the Liberal policy on agriculture and on supply management.

I will go next to some quotes from the parliamentary secretary to the agriculture minister. I will read from a publication put out by the Independent Dairymen's Association Committee of British Columbia which is made up of the Mainland Dairymen's Association and the Southern Interior Dairymen's Association:

Following are some public quotes from Lyle Vanclief, parliamentary secretary to the federal minister of agriculture, member of Parliament for Prince Edward-Hastings, and owner of a cash crop and market garden farm in Ontario:

"It is more than definite that the future of supply management in Canada will be `uncertain after the year 2001'. The United States insists that the earlier signed NAFTA supersedes GATT rules. The Americans expect tariff levels to be reduced at a quicker NAFTA rate and be completely gone to zero by 1998".

There are three or four more paragraphs but for the sake of brevity I will end the quote from the parliamentary secretary with that.

It is interesting to note the difference between what the Liberals said in the red book and what the parliamentary secretary to the agriculture minister is now finally starting to say in public. Until now this Liberal government has pretended it can protect supply management. It seems to have refused to acknowledge that NAFTA and the GATT and changes that will come to both agreements will bring about quick change to the supply managed industry, including the dairy industry.

It is encouraging that the parliamentary secretary is finally starting to talk publicly about some of the changes that will come about. This will give the industry some time, a bit of a transition period, to get from where it is to a competitive system which will be in place some time over the next few years.

The third source is an article from the May 4 Western Producer . The headline is: Grits didn't support supply management''. The lengthy quote is from Michelle Comeau, former assistant deputy minister for agriculture:Supply management has proven useful in stabilizing farm income but has generated costs to consumers and to the economy in general''.

Barry Wilson leads in by saying: "The Liberals wanted the end of supply management long before GATT, say internal documents". This is totally different from what the Liberals have been saying publicly.

Part of this article states:

Long before the December 1993 world trade deal "forced" Canada to abandon the legal basis for supply management, the government had decided the system had to go, according to an Agriculture Canada planning document.

Memos issued in 1993, obtained from government files under access to information legislation, show a government publicly proclaiming support for supply management, while privately drawing up plans to manage its weakening.

According to a memo written in late 1993 by then assistant deputy agriculture minister Michelle Comeau to then deputy minister Rob Wright, the system was too rigid and too farmer-dominated.

In any reform, the power of the provinces would have to be reduced and the "excessive producer control over decision making" would have to be counter-balanced by a greater role for processors, retailers and consumers who want lower prices.

"Supply management has proven useful in stabilizing farm income but has generated costs to consumers and to the economy in general", she wrote. "Reform is required."

Point out how different this is from what the Liberals were acknowledging at the time. If the Liberals did not agree with what the bureaucrats were saying, they should have said so then. They chose not to. It is clear from this article the Liberals are saying one thing in public and another thing privately.

I continue with this article:

Comeau's memo was part of a plan devised by the bureaucracy to handle fall-out from the decision to sign a new world trade deal, even though it excluded the rule which had allowed Canada to control imports of dairy, poultry and egg products governed by supply-managed rules.

For years, the government had been criticizing the rigidity of the decision-making process while praising supply management as a way to help farmers make their living from the market.

Privately, the bureaucrats were agreeing with consumer and processing lobbyists that supply management was bad for the country and the economy.

The planning documents laid out a strategy for dismantling the traditional rules of supply management-controlling the communications, stressing that the system could survive under new rules, injecting more voices into the decision-making, stressing that trade deals and competition made change inevitable and making sure the provinces accepted some of the responsibility for deciding to tear the old system down.

This, released through access to information, is much different from what the Liberals have been saying publicly.

Reform has chosen the more direct and honest approach, even if it means taking some heat in the short term. Which is kinder and gentler, as the Liberals like to always say, to pretend that major changes are not coming and ending up with the pain and hardships that grain farmers in western Canada will feel over the next years as they deal with subsidies that were removed overnight, or being open and honest and allowing dairymen and others involved in the industry to make the transitions that are necessary?

It would be kinder and gentler to lay the cards on the table and allow farmers and processors the time they need to make the transition from this protected industry to a more competitive industry.

The change is coming. Reformers have chosen to be up front and honest in dealing with changes to supply management. I encourage dairy farmers across Canada to choose the approach they prefer and to choose the people they prefer to help them with the transition they must make over the next few years.

[Employment Equity, April 6th, 1995]

Mr. Speaker, it is a pleasure indeed today to rise to speak on the motion presented by my colleague from North Vancouver. I would like to congratulate my colleague for his speech, which outlined the purpose of his motion.

The motion deals with a sensitive issue, the practice of employment equity. I am pleased to have seconded the motion and to support the motion, which calls for the immediate end to employment equity programs and the end to the inclusion of employment equity requirements on employment or training forms. Such requirements encourage candidate selection to be made on the basis of sex or ethnic origin rather than merit and as a result foster a sense of resentment among applicants. The whole concept of employment equity is flawed. As my colleague pointed out, it advocates the hiring of individuals based on designations, not merit.

The hon. member for Fraser Valley West also expressed it quite well. He said the concept of employment equity will subordinate the principle of merit to the politics of race and of gender. This is made clear by a number of factors, one being the sense of dissatisfaction with employment equity by those it claims to help.

Members of targeted groups who supposedly benefit from employment equity face two difficult questions, the first from themselves. Were they chosen for the position they now hold because of the target group they belong to, or was their hiring based on merit? It is a question that is always there.

Second, there is a question from their colleagues. Do the individuals they work with have doubts about whether they were hired based on the fact that they are a member of a visible minority or a member of a disadvantaged group, or did they truly deserve the position?

This brings me to my second point. When people in a workplace really do not know why they or their colleagues were hired, whether it was based on merit or because of a specific category to which they belong, it fosters a sense of inequality and divisiveness among co-workers. This sense of inequality, as a result of astute hiring practices and quota filling, can lead to a split in the workplace because they create an atmosphere of distrust and doubt. This does not make for a productive or a happy workplace.

I would like to tell a story that was told to me by a staff member of a member of Parliament on the Hill. She had a friend at university, a very bright individual and a member of a visible minority group, who often spoke out very strongly against employment equity programs. Many people questioned his position. They asked why he, one who could obviously benefit from such programs, was so vocally and so strongly against these programs. His reasons were that he did not know, and was afraid that he would not know, if he was hired based on his skills or his skin colour. His co-workers would not know either. This individual said he wanted to be judged solely on the basis of merit and on nothing else.

Indeed, even hon. members opposite have expressed similar views and have shared similar stories. The hon. member for Waterloo stated in committee, with regard to the government's employment equity legislation, that an individual from his own riding did not want people to think he got his job based on preferential treatment. This constituent was also speaking out against employment equity.

Looking at this concern from another point of view, from a point of view based on productivity in the workplace and from the employer's point of view, I would like to tell another story. This story was told to me personally by a gentleman who owns a fairly large business that he built from scratch in my constituency.

This gentleman's company bid on government contracts on a fairly regular basis. He had been very successful in winning these contracts over the years. He was expressing a deep concern to me that his company was no longer eligible to bid on these contracts. The reason was that he did not have the proper quota allocations within his company. More than 50 per cent of his employees were women. He had always hired a considerable number of women because they could do the job best. He had some members from visible minority groups. But his company could not successfully keep enough employees from the aborigi-

nal group to be able to bid on this contract. Because of this, this business person was disqualified from bidding on these contracts. Any way one looks at that, it is discrimination.

Why does the government then feel that we need employment equity? I guess its reason is to correct perceived injustices in the workplace, an honourable motive. However, when we look at numbers we see that these injustices are often only perceived, and mostly perceived by government.

I would like to present a few more stats to add to those presented by the hon. member for North Vancouver a little earlier.

There are 570,000 people currently regulated by the present Employment Equity Act. Women make up 45.6 per cent of those covered. When looking at women in the overall Canadian workforce, we find that 45.9 per cent of the workforce is female. There is a difference of .03 per cent between those who work under the bodies that are covered by the Employment Equity Program and those in the greater workforce. That is .03 per cent. We have to ask ourselves if this .3 per cent is enough of a difference to warrant the cost and the damage done by these employment equity programs.

According to StatsCan for example, in 1992 single women made about 99 per cent of the salaries of single men. Many salary differences between men and women can be explained by lifestyle choices, for example, the choice to stay at home and raise a family. Of course, that is a very honourable choice indeed.

As well, the Economic Council of Canada released a study in 1992 that found no correlation between wage levels and a person's country of origin. The same report also found that immigrants have a lower unemployment rate than Canadian-born workers. The conclusion reached in the council's report was that there is no significant discrimination against immigrants in general.

In 1994 the employment equity report said that in total, women occupied 47 per cent of government jobs while 47.3 per cent were available to work. Jobs held by women increased by a full percentage point in 1993-94. They took a full per cent more of the top jobs despite the fact that the executive category declined by 6 per cent. Again, would government have us bring in costly programs to adjust for a difference of .3 per cent?

I have a few more statistics. The civilian staff at the RCMP is 82.6 per cent female. At Citizenship Canada, 74 per cent are female. However, in Transport Canada more than 75 per cent are male. Are we to assume that this under-representation of women in the transport department is caused by discrimination? I would say no. However, that is what the report wrongly assumed and this illustrates the fundamental flaw in the report. It is difficult to determine why there are differences, but we cannot automatically assume that it is due to rampant discrimination.

Again I ask the question: Why do we need employment equity programs and legislation? The answer is: I do not think we do. Then why do we have them? I believe we have them because the Liberal government's agenda has been and in fact is set too much by special interest groups and these special interest groups support employment equity. They are not driven by public interest.

We have had too much government based on the vocal input from a minority and too little government based on the less vocal input of the majority. We have had government by the minority instead of the majority. What we have with employment equity is a playing field that is tipped in favour of special interest groups. That is not what Canada is all about.

The motion today calls for the immediate end to employment equity and I fully support the motion. In keeping with the Reform practice of proposing positive alternatives, I will explain the Reform Party's position on employment equity by making five short statements:

One, all Canadians are equal before and under the law and all workers have the right to be free from discrimination in the workplace. Two, the market will provide solutions to a representative workplace in the private sector. Three, it is the role of government to ensure equality of opportunity rather than to determine equality of employment outcome in the public sector. Four, the workplace should be free from arbitrary obstructions to hiring or promotion. Merit must be the sole hiring criterion. Five, employment equity legislation is coercive, discriminatory, unnecessary and costly. It should be discontinued.

[Petitions, April 6th, 1995]

Mr. Speaker, pursuant to Standing Order 36 I have the honour on behalf of some constituents of the Vegreville constituency to table a petition in the House today. The 26 petitioners are requesting Parliament to continue to give the Canadian Wheat Board monopoly powers in marketing wheat and barley for export.

[Agriculture, April 4th, 1995]

Mr. Speaker, yesterday I asked the minister of agriculture whether farmers who deliver grain to the elevator before July 31 will have to pay the full freight rate for their crop if it is not shipped out of the elevator until after August 1.

The minister confirmed that farmers who sold their grain to the Canadian Wheat Board and delivered it to the elevator

before July 31 will end up paying the full freight rate if the grain was shipped to the terminal after August 1.

This position was not made clear in the budget. Farmers were led to believe that as long as the grain was in the elevator by July 31 the Crow benefit would apply. Now farmers find out this is not true. They may be stuck with paying the full freight rate even if their grain was in the elevator before July 31 deadline.

The minister should have been straightforward with farmers about this deadline in the first place. Farmers will end up paying the full freight rate on some of the grain they deliver before the end of this crop year.

[Supply, April 4th, 1995]

Mr. Speaker, I heard the hon. member talk about a loss in jobs, particularly in the research area.

Everyone is concerned about losing jobs in research. We all know the importance of research. It is one of the top priorities Reform has targeted in our budget and in past documents dealing with the budget.

I agree with the Liberal philosophy with regard to research. I believe that at least what they say is the best approach to take regarding research. Research should be targeted better. There should be more partnerships developed with the private sector so taxpayers dollars are in with private business dollars to form partnerships to end some of the duplication in research and to spend the research dollars better. Private business needs to take a bigger role in targeting research so research is being done in the areas most likely to pay off well to business in terms of improvement. In this case we are talking about agriculture.

I agree with the Liberal philosophy presented with regard to research. I am concerned about the loss of jobs in research. We cannot afford to lose the research. There is room even in research to do a better job with the dollars we have.

While I agree with the member's concern about the loss of jobs, I ask the member for his comments on the loss of jobs that will result from the cuts the government has made not going far enough. In other words, there is no definite deficit target set in the budget. Because there is no definite target business will not have the atmosphere it needs to expand and or new businesses to be set up. As a result there will be fewer jobs in the future and certainly the jobs that could come-

[Supply, April 4th, 1995]

Mr. Speaker, I would be glad to answer the member's question.

I base this on three main points. The first point has been well made by the lawyer representing the dairy farmers of Canada in their push to keep American products out of the market. They of course are saying that GATT takes precedence over NAFTA with regard to supply management. The lawyer who is representing the Dairy Farmers of Canada has said: "Hey, guys, you had better be careful here. The Americans have a very good case that in fact NAFTA has precedence over GATT."

As this member will well know, this lawyer-who represents the Dairy Farmers of Canada, not the Americans-has said that this is a real concern and that we had better be prepared for the decision going in favour of NAFTA having precedence over GATT. If this happens then supply management as we know it is in jeopardy immediately.

The next major thing that threatens supply management as we know it is the NAFTA negotiations around letting Chile into the NAFTA family. Our Prime Minister and the President of the United States have said that within four years Chile will be part of the NAFTA family. When that happens, and as those negotiations take place, I believe Americans will demand that Canadian markets be opened up to their products in the supply-managed area. That is the second very real threat to supply management.

The third threat is the new GATT negotiations, which will take place starting in the year 2000. I believe those new negotiations will in fact lead to a rapid deceleration in tariffs protecting the supply-managed industry.

I do not like saying these things to supply-managed farmers because I know this is going to present a great difficulty and a real challenge for them, but I am not going to hide it. I am going to be very honest and open and say: "I believe this is what is going to happen. Take any time you have to prepare yourselves for this major change."

[Supply, April 4th, 1995]

Mr. Speaker, I also received the memo from the sheep producers, who expressed their concern about the cuts in research funding to their industry. I received the letter yesterday and I look forward to talking with the sheep producers to see exactly what will happen to research in that area.

With respect to the hon. member's comment that these petty cuts are not acceptable, there is an overriding concern resulting from the budget that requires that cuts be made. Most farmers I have talked with have recognized, reluctantly, that the cuts to their industry, while unfair, are absolutely necessary in order to deal with the severe fiscal problem we have. Again, I say they are unfair because they were not balanced between cuts directly to farmers and cuts to the department, and they were not balanced across the country.

The biggest concern of farmers is that the cuts did not go far enough. There is no definite target for the deficit being eliminated. I would like to address the impact of that on farmers. When the member spoke of petty cuts, I became very concerned because these cuts were needed, and more cuts are needed.

However, I hope future cuts will be made in other sectors of federal spending in order to have some balance in the equation.

This budget did not go far enough. Our interest payments will have increased from $39 billion, when the Liberals took power, to $51 billion a year by the end of the three-year budget projection period, which ends two years from now. Those are interest payments on our debt alone. The result of that is an extra $12 billion of taxpayers' money that is being spent on interest payments on the debt. Still, with the Liberal budget, the debt will increase by $24 billion a year at the end of these three years. That means ever-increasing interest expenses.

Where is the money going to come from to make these ever-increasing interest payments on the debt? It will come from the taxpayers, and there are not enough taxpayers' dollars to pay for increased interest payments. That means that tax increases are not an option. That means that cuts will have to be made somewhere else in order to pay for these extra interest payments.

I encourage the government to take a step over the next five or six months to present another budget that will go far enough and set a definite date on which the deficit will be eliminated. I encourage them to do that. However, because that has not happened, and by not having enough cuts or a definite date for when the deficit will be eliminated, interest rate costs will be higher for farmers, because this continuing deficit has put upward pressure on interest rates. Lenders will be hesitant to lend; getting financing is going to be more difficult for farmers. There is also the threat to social programs, which will continue.

So not only are farmers asked to share more of the cost, but there is a real threat to social programs, including pensions, health care and other social programs that they depend on and want.

I do not think any of these cuts can be called petty. In fact, this government must go further in the very near future or the damaging results will go way beyond the pain that has been caused by the cuts in this budget.