Pierre Paquette

[The Budget, February 19th, 2003]

Mr. Speaker, it is with a great sense of responsibility that I rise to speak on yesterday's budget presented by the Minister of Finance.

Yesterday, the government missed a golden opportunity to fundamentally change the state of finances and the state of the economy in Canada and Quebec.

The $15 billion in spending announced yesterday for the next two years shows that the federal government had ample leeway to respond to the concerns of Canadians, Quebeckers and the provinces with respect to some of the basic issues that have been debated for the past two or three years.

Rather than tackle the real problems, the government and the Minister of Finance, not unlike the Prime Minister, chose to take an all-over-the-map approach. I found 74 different areas of spending.

He chose to invest in provincial jurisdictions. Once again, he chose to create new initiatives, without really tackling the issues raised by Quebeckers, Canadians and the provinces, especially Quebec.

Although I am extremely disappointed to see that the Minister of Finance and the government did not take advantage of this golden opportunity, given that they had the means to correct a certain number of fundamental problems, I am nonetheless pleased to see that the public and the media, in particular, were not taken in.

In the headlines this morning I noticed for instance that the budget handed down by the Minister of Finance was described as a budget for everybody and a budget for nobody.

One newspaper indicated in its article on the budget that he is trying to please too many people. Another headline referred to hidden defects. A third was entitled, “Promises, Promises” and another, “The Urge to Spend”. Finally, there was one that I found especially striking describing yesterday's budget as a chicken with its head cut off. The government is running around in all directions and has produced a budget without a master plan.

The first thing to note in considering yesterday's budget speech and related documentation is that it has shown the extent of the fiscal imbalance. I think the federal government should have made it a priority to correct this imbalance, whereby this government has much greater financial resources than it needs to fulfill its responsibilities, especially those recognized under the Constitution Act, 1867.

There is also the fact that the needs are in the provinces and that, over time, the past few decades in particular, these needs have caused expenditures to grow, sometimes exponentially.

With respect to health, given the aging of the population, the new technologies and drug costs, we know that health costs are growing faster than the collective wealth, the gross domestic product.

So, the needs are in the provinces, while the money is in Ottawa. This became obvious yesterday when the Minister of Finance announced an additional expenditure of $6.4 billion to be made within a matter of weeks— we are not talking about years or decades here—that is by March 31. That is five weeks from now, six at most.

This goes to show that,unfortunately, the federal government has again kept information from the public, information on the real anticipated surpluses for the current fiscal year in particular. I will come back later to the fact that, for the next fiscal year also, we think that the surpluses will be much larger than those announced yesterday by the minister.

To illustrate this fiscal imbalance, since the Liberals took office, revenues raked in by Ottawa have increased from $123 billion in 1993-94 to $185 billion on 2003-04. That is a 50% increase.

We are not talking about several decades. We are talking about ten years at most, during which the federal government saw its overall revenues increase by 50%.

I think we all agree that this is a lot of money, considering the responsibilities of the federal government.

As I mentioned, for the current year, the minister had told us, in his economic statement, about a $1 billion surplus for strategic planning. Let us be generous and add to that $1 billion for strategic planning the $3 billion contingency reserve. This amounts to a $4 billion surplus.

Yesterday, not only was the minister able to maintain the $3 billion reserve, but he also announced, as I mentioned earlier, additional spending of $6.4 billion by the end of the fiscal year.

The minister himself admits that the surpluses will not be around $1 billion, if we exclude the reserve, or around $4 billion if we include it, but, rather, around $9.4 billion.

Based on the forecasts of the main Quebec and Canadian banks and financial institutions, we had anticipated that the surpluses would be closer to $10.4 billion.

Indeed, for the past several weeks, the Bloc Quebecois has been telling the public, through the media, and also here in the House, that the surplus would be closer to $10.4 billion.

Now, we must also take into consideration the changes tof accounting procedures announced by the minister yesterday, at the specific request of the Auditor General. Following these changes, this year's surplus will increase by $3.1 billion.

While the minister admitted yesterday that the surplus would not be $4 billion but, rather, $9.4 billion, I can assure the House that at the end of the fiscal year, once all tax revenues and expenditures have been calculated, the surplus, before the measures announced yesterday, will be around $13.5 billion instead.

The government is still hiding from the public the real state of public finances. This is totally unacceptable, particularly on the part of a minister who prides himself on being transparent.

This reminds me of a saying that has been around for generations in Quebec and that has to do with culture. We often say that culture is like jam: the less one has, the more one spreads it. It is somewhat the same thing with transparency. The less one has, the more one boasts about it.

I think that the minister and the current government are back up to their old tricks, incapable of acting with transparency and providing accurate information to the public. The best I heard was one commentator who said that it was true that the current Minister of Finance was underestimating the surplus, but not to the extent that his predecessor was. We could at least give him that.

This is not what Canadians and Quebeckers want to see. They want to know the true state of affairs.

As I mentioned earlier, we are projecting a surplus this year of around $13.5 billion. Next year, unlike the minister who has announced an $8.8 billion surplus, we believe that the surplus will be around $12.3 billion.

Yesterday in his budget, the Minister of Finance announced a surplus of $18.2 billion over two years, based on the spending and contingency reserve he indicated; however, we project a surplus of over $25.8 billion for this same period. That is a difference of approximately $7 or $8 billion.

Not only is this observation a sign that the government lacks transparency, but the size of this surplus is eloquent testimony—and no one on the government side can say otherwise—to the existence of a fiscal imbalance. Instead of spreading this $15 billion all over the map, they should have fixed the structural problem of fiscal imbalance once and for all.

Remember that, next year, 7 out of 10 provinces in Canada will be running a deficit. Only Quebec, Manitoba and Alberta will avoid this situation. There is something wrong when the federal government has doubled its revenues over the past 10 years, while most of the provinces, except Alberta, which is a very special case, are running a deficit. Even Quebec and Manitoba are just managing to keep their heads above water. A economic downturn could push us back into a deficit.

I was saying that except for Alberta, Manitoba, and Quebec, all the other provinces are running a deficit. Even Ontario will run a deficit next year.

It is the same taxpayer. It is not a taxpayer with a split personality who has one way of looking at the taxes he pays to Ottawa and another way of looking at the taxes he pays to Quebec City. It is the same taxpayer who pays in both cases.

As I mentioned earlier, we would have liked the federal government to withdraw from part of the tax base and allow the provinces to independently and democratically assume their responsibilities, especially in health, post-secondary education and income security.

The first observation we must make about this budget is the extent of the fiscal imbalance, which was once again demonstrated by the Minister of Finance himself.

The other observation is that since the government has too much money and not enough responsibility, it is inventing responsibilities. I think the second thing we must take from yesterday's budget is that a good portion of the money is going to the wrong priorities.

After the first ministers meeting a few days ago when the Prime Minister of Canada announced $2.5 billion in new money for the Canada health and social transfer, and with the size of the surplus now out in the open, although not news to us, we would have expected the federal government to have done a little more for health.

But it stuck firmly to the agreements that were reached barely ten days ago. As I was saying earlier, we have to use money we set aside for priorities that are questionable, to say the least. I will come back to this.

By the way, just in terms of interference in provincial jurisdictions, in Quebec in particular, with regard to the $15 billion that I talked about earlier, we identified $4.5 billion in new spending in areas that do not remotely come under federal jurisdiction.

This will result in squabbles, confusion and waste. The taxpayers of Quebec in particular, and those in the rest of Canada as well, agree that there was no need of it. The needs are so great, social needs in particular, that this money could very well have been used for more positive purposes, particularly, as I have already said in my first point, to correct the problem of fiscal imbalance for once and for all.

While they were busy invading areas of provincial jurisdiction, and funding a whole series of initiatives in a multitude of areas, many different segments of the population of Canada and Quebec who need immediate assistance failed to receive it.

I am thinking, for instance, of the workers, communities and companies that are victims of the softwood lumber dispute at this very time. There is absolutely nothing in the budget to address this dispute, which has now dragged on for over a year and half, almost two years.

I have asked the question of the minister, but he was not able to answer. He stayed in his seat and deferred to the Minister for International Trade.

We would have expected a number of measures for self-employed workers, particularly in connection with employment insurance. It is as if they did not even exist. We know very well that, within a few years, what is termed non-standard work, that is work that is not regular or not full time, will become the norm. As far as the federal government is concerned, however, it is as if it never existed. They are still living in the 1950s or 1960s, and have not noticed that the labour market has changed.

There is absolutely nothing for aboriginal people in this budget either. I will be told, of course, that there is plenty of money for health. That, however, will not make any fundamental change in the relationship between the federal government and aboriginal people.

In the coming year, the unemployed and the workers contributing to EI will again be having to make contributions that will be used for purposes other than protecting their income if they lose their jobs.

So, a lot of areas have been ignored. There are, of course, some measures that may at first seem worthwhile, in particular the higher limit for RRSPs, registered retirement savings plans. Despite the fact that the limit has been raised to $18,000, it must be kept in mind that only 1.5% of Quebec taxpayers are already contributing the maximum allowed amount of $13,500.

I noticed that several financial analysts have highlighted this initiative, but this does nothing to solve the problem of retirement savings. Approximately 80% of the population is unable to contribute enough to RRSPs. These people have no access to additional pension funds and they may end up in poverty when they retire. In response, the federal government preferred to implement a measure that, at first glance, seems to be good, but that will only help a small minority of people in the end.

I spoke of misplaced priorities earlier. We know that since 1998, the defence budget has increased 53% and there is an additional $1 billion in spending for next year.

Of course we are not against defence spending in principle, but we need to know what this money will be used for. There has not been a review of Canada's defence policy in more than ten years. The debate on Iraq only proves that we do not know what Canada will do; the position of the Government of Canada is unclear. Before throwing billions of dollars at defence, I think we should have had this debate.

And there are other priorities. Take the example of post-secondary education. Federal transfers for education have decreased 30% since 1996. I think that this is a priority need for Quebeckers and for all Canadians. This need could have been met immediately.

I do not have much time left, and a number of my colleagues will have the opportunity to touch on different aspects of the issue, but I would like to talk about the minister's proposal regarding employment insurance premiums.

The minister has made much ballyhoo about the drop in premiums, from $2.10 to $1.98 per $100 in insurable earnings. In fact, he already announced the greater part of this decrease last October during his economic statement, where he said that he would be lowering premiums from $2.10 to $2.00. Now he is announcing that it will not be $2 but $1.98.

In fact, what the Minister of Finance announced yesterday was a decrease in EI premiums of two cents more than previously announced. He will give up $100 million and continue to collect between $2.5 and $3 billion in excess premiums. Obviously, this is before holding consultations. We shall have to keep an eye on the government on this one.

I would like to read from a release by the Department of Finance issued on February 2, 2001—that was just two years ago—which said the following, with respect to the EI premium rate:

In December 1999, the House of Commons Finance Committee concluded that the rate setting process needed to be revised. When Bill C-44 was introduced in September 2000, the Government of Canada announced that it would undertake a thorough review of the EI premium rate setting mechanism.

The same promise was made two years ago by another finance minister, and nothing came of it. What is scary is that the then Minister of Finance could well become the Prime Minister in a few months.

Would it not have been better to immediately resolve the issue of the process to set rates by creating an independent fund? That is what the unions are requesting, as are a good many employers' associations, to ensure that those contributing are the ones managing the fund and making decisions about premium rates and coverage.

Instead, what is announced is a consultation process, which I can predict will go nowhere. Meanwhile, the government will keep dipping into the EI fund and using this money, billions of dollars, for other purposes.

This budget is therefore a big disappointment. It provided a golden opportunity to resolve, in Canada and Quebec, a number of fundamental problems such as fiscal imbalance, misappropriation of EI funds, infrastructure—for which municipalities are requesting huge amounts of money—Kyoto and many others.

As I said, in the next few days, several of my colleagues will have the opportunity to demonstrate that this budget is utterly unacceptable.

Accordingly, I wish to move an amendment to the amendment put forward by the leader of the Canadian Alliance.

I move:

That the amendment be amended by adding after the word “Minister” the following:

“that, among other things, deny that there is a fiscal deficit between the federal government and the provinces, and conceal budget surpluses to the detriment of democratic debate, and”.

[The Budget, February 19th, 2003]

Mr. Speaker, once again, this budget contains nothing for softwood lumber, a human economic crisis that has hit thousands of workers and their communities in addition to hundreds of businesses. The assistance plan provided for a second phase. We are still waiting for it.

Can the minister deny that his budget contains absolutely nothing for the victims of the softwood lumber conflict?

[The Budget, February 19th, 2003]

Mr. Speaker, one wonders why the Minister of Finance is proud, when his budget consisted of handing out more than $15 billion with nothing to improve access to employment insurance, nothing for the cost of gas and heating oil and nothing for softwood lumber.

Since he has the money, how can the Minister of Finance explain that his budget contains not one word on the issues that are having a terrible impact on thousands of Canadians and Quebeckers?

[User Fees Act, February 14th, 2003]

Mr. Speaker, I am pleased to take part in the debate on Bill C-212, An Act respecting user fees, introduced by the hon. member for Etobicoke North. I can say from the outset that the Bloc Quebecois will support this initiative.

Indeed, user fees, whether they are set by departments or other federal agencies, are a recent development, but one that seems to be gaining momentum. As we know, in recent years, not only in Canada, but also in a large part of the western world, governments have had a tendency to reduce personal and corporate income taxes, while trying to find other means, which are often less visible than personal income taxes, to fund the activities and services provided by their various departments or agencies.

It is estimated that, for last year alone, consumers paid $4 billion for services provided by government agencies or departments.

Taxpayers are not stupid. They realize that if, on the one hand, taxes are lowered but, on the other hand, user fees increase, they might end up being the losers.

As the bill proposes, there is a need for greater transparence about what these user fees really are and for Parliament to play a role in setting these fees. We know that, contrary to income tax, which is a progressive tax—the higher the income, the higher the marginal tax rate—user fees are the same for everyone. They represent a form of regressive taxation, which may be totally legitimate—there is no denying that—but which still affects taxpayers and the people of Canada and Quebec differently.

Before user fees are imposed or changes are made to them, it is imperative that Parliament have the authority to look at the impact of imposing or changing these fees. Especially since this is not only a regressive tax, but user fees will often be charged for a service that is a monopoly.

Take passports for instance. If I need a passport, I have no choice. I must contact the department responsible be issuing passports, fill out the form and pay for the service. This is a monopolistic situation.

Regulation is necessary, as in the case of most monopolies. Parliament must ensure that imposing user fees will not have disproportionate and unfair consequences for Canadians and Quebeckers.

Also, and this is in keeping with the debate we had this morning, there is the matter of the quality of service. If user fees become common and increase, but the quality of service available to the taxpayers and users decreases, and there is a monopoly, there will certainly be public frustration and even questions about the public nature of these services, as is already the case.

So it is perfectly normal for Parliament to be able to make a decision using the procedure set out in this bill, one I find quite appropriate. Parliament must be able to vote on the imposition and amount of user fees.

This bill also proposes to establish a federal regulatory body—which is quite appropriate—to hear complaints and also examine the imposition of user fees or changes to user fees. We have no problem with this. I think that the Standing Committee on Finance should also play a major role in considering requests to implement user fees, as well as the amount of such fees, based of course on all the documents prepared by this federal regulatory body.

Should the House support this bill at second reading, and I hope it does, and refer it to a committee, I would like to look at a particular issue that is not covered by the hon. member's bill, namely private foundations.

In her April 2002 report, the Auditor General said, and I am quoting the first paragraph of the main points in chapter one:

The federal government has paid billions of taxpayers' dollars to private foundations and other delegated arrangements set up to achieve public objectives, transferring the funds years before Canadians receive the intended benefits.

I draw the attention of the House to the following sentence:

The government has delegated program responsibilities to these arrangements, but they are often beyond the reach of Parliament's scrutiny.

The Auditor General is referring here to public programs.

It seems to me some private foundations could also provide services and collect user fees. We should take a close look at this. I am not referring to all the activities of these foundations. Indeed, as regards this aspect, the Auditor General is already proposing greater accountability to Parliament on the part of the government and of these foundations, which receive billions of dollars from the federal government.

In addition to what the Auditor General proposed, I think that during consideration of Bill C-212, we could see whether there is interest in expanding this bill to certain private-based activities—as the Auditor General mentioned herself—that have responsibilities with respect to public programs.

At this stage, I have made a list of foundations that we might find interesting, and there are many. I think the committee will have to take a more technical approach to all this information, namely whether a foundation to which delegated a certain number of responsibilities in public programming have been delegated, imposed user fees.

At this time, I will not dispute the fact that Bill C-212, An Act respecting user fees, could also apply to the activities of some private foundations.

I think the basic principle of the bill is entirely valid. It has a close connection with current discussions within all the political parties about enhancing the role of Parliament and the role of its members. It is a duty that is expected of the elected members, that is, to ensure that user fees are valid and reasonable when they are implemented, and that these fees do not become prohibitive.

It is part of the role of Parliament. It is also an issue of transparency, especially in a context where tax breaks totalling $100 billion have been announced for the next five years. The government should not give tax breaks with one hand and take back user fees with the other. This amounts to regressive taxing. There are already examples of what this government is capable of, with employment insurance.

So, in terms of transparency and democracy, I think that Bill C-212 deserves the support of the House. As I mentioned at the beginning of my comments, the member can be assured of the support of the Bloc Quebecois.

[Taxation, February 14th, 2003]

Mr. Speaker, I do not think anyone will take issue with my next question.

The Minister of Finance is trying to do indirectly what he cannot do directly. Can the Minister of Finance assure us that there is no way our money will be used to save a professional hockey team whose players are millionaires?

[Taxation, February 14th, 2003]

Mr. Speaker, having tried three years ago to help professional hockey teams and the Senators, and having recently called the president of the CIBC, now the Deputy Prime Minister is prepared to take $60 million from taxpayers' pockets to keep the team in Ottawa, at all cost.

Does the minister not understand that taxpayers do not want the government to give money to a professional hockey team whose most obscure player earns more than the Prime Minister of Canada?

[Gasoline Prices, February 12th, 2003]

Mr. Speaker, strange but true, on the eve of the election the government had a lot more imagination than it does now, when it announced that it would be sending heating oil cheques out to everybody, including people who were dead or in jail.

Does the government plan to be just as imaginative in finding some meaningful ways of helping people to cope with this rise in gasoline prices?

[Gasoline Prices, February 12th, 2003]

Mr. Speaker, the government is preparing to present a budget which will include considerable amounts for a war described by the Prime Minister as hypothetical. Meanwhile, the spiralling prices of gasoline are hitting consumers hard.

If the government is capable of taking concrete steps in connection with a hypothetical war, what is keeping it from taking action on spiralling gas prices, and from letting us know what the budget will do to help consumers, in particular taxi drivers, truck drivers and farmers?

[World Social Forum in Pôrto Alegre, February 7th, 2003]

Mr. Speaker, the third annual world social forum in Pôrto Alegre—attended by only one party from the House of Commons, the Bloc Quebecois—advocated globalization with respect for the sovereignty of nations, the environment and shared prosperity.

At the parliamentary forum, alternatives to neo-liberal globalization were presented: protecting cultural diversity, levying a tax on financial transactions, respecting fundamental rights to work and the environment in trade agreements, and eliminating tax havens.

The Bloc Quebecois made sure so that the final statement at the parliamentary forum would indicate our opposition to the negotiation of a multilateral agreement on investment within the WTO and the FTAA that stands to benefit transnationals.

Parliamentarians also agreed to ask their government to pressure the IMF to change its charter to take human rights into account in their refinancing plan.

The federal government's absence was glaring but the Quebec government was represented by Minister Louise Beaudoin, who publicly voiced her hopes that Quebec would attain full sovereignty and join the countries that are working toward globalization that serves the people.

[Financial Institutions, February 5th, 2003]

Mr. Speaker, the reduction in competition and the fate of the communities and bank staff involved in mergers also need to be addressed.

With a view to transparency, does the minister plan to implement a mechanism for local public consultations when planned mergers would bring about branch closures, before any planned closure occurs?