Mr. Speaker, I am honoured to rise today to respond to the government's first budget. I would like to begin by sharing a quotation that a colleague recently sent to me. It goes like this: “[T]he debt and the deficit burden pose much more than an economic challenge. This is a moral issue too. What right do we have to steal opportunity away from our children”?
These words are as true today as they were 22 years ago. It might surprise my colleagues across the aisle to know who spoke those words. Speaking in this House, the former member for LaSalle—Émard struck upon a fundamental truth: borrowed money is not free; it is a debt that will have to be repaid by future generations. These words were spoken by the Right Hon. Paul Martin, a former Liberal prime minister and former finance minister.
While the party that he once led may now question the wisdom of his words, Her Majesty's loyal opposition does not. He knew the importance of having a fiscal anchor, a fiscal discipline, and a clear plan. Only with those do we have the ability to safeguard all of the programs that we need to care for the most vulnerable in our society. How can we have a compassionate government without a strong economy?
As Conservatives, we think that if we are to borrow on the backs of our children and grandchildren, we better have a very good reason to do so. Canadians deserve a plan and they deserve a clear path to prosperity. They deserve to know why the government needs so much more of their hard-earned dollars. Frankly, they expect the government to know what it is doing. Unfortunately, the government's budget fails on all of these counts.
I will be very clear on these three points.
First, the government is borrowing and spending a lot more money than it promised. Second, it is already raising taxes to pay back what it is borrowing and spending, and it will have no choice but to raise them again. Third, even after spending and taxing, the government has no strategy to create jobs or grow our economy.
Let me elaborate on those points.
First, the government is borrowing and spending a lot more money than it promised for no clear economic justification other than a political one.
Second, it is already raising taxes to pay it back, and it will have no choice but to raise them again in the future. Canadians are already overtaxed.
Third, even after spending and taxing, the government has no strategy to create jobs or grow our economy. Expert after expert have said that there is no evidence that any of the spending will create jobs.
On this side of the House, we are all worried about the uncontrollable borrowing. By refusing to live within its means today, the government is endangering growth and prosperity tomorrow and endangering the important programs on which Canadians rely. This is not just a hypothesis. If we remember the last time the Liberals were in power, we saw a 30% reduction to health care transfers. In fact, it is an irrefutable evidence-based fact, one that Canadians of a certain age know all too well.
If we remember the 1970s, the promise of the day was for a modest deficit, which back then was about $12 billion in today's dollars. That ballooned to more than a $70 billion deficit in just a decade. Interest rates then skyrocketed, investment vanished, and jobs disappeared.
By 1984, 20% of the federal budget was being eaten up just by interest payments. That is nearly three times as much as the government spent on defence, and five times more than it spent on health care.
If we fast forward to today, we are now seeing this happen in Ontario, where reckless borrowing has led to massive debt and deficits, and interest payments are now consuming money that should be spent on health and education.
A generation of opportunity was lost, and it was a long, painful journey back. With this budget, I fear the Liberals are taking Canada down the same perilous path.
We have seen it before, but it is back. It is that old, tired 1970s fiscal policy, ideas that do not stimulate any growth or create any jobs.
We were joking the other day that we all love retro, because it is back. We love the retro fashions of the 1970s, even some of the furniture. In fact, I even bought myself a new vinyl record player on eBay. However, one thing I do not like is 1970s fiscal policy.
Canadians are now asking why they should trust the government with more of their hard-earned money. How can they trust the government when the story is constantly changing? After promising modest deficits of no more than $10 billion, it has handed Canadians a bill for three times that amount. It promised to balance the books within four years, and it broke that promise too. Then it said our debt as a share of our economy would fall. That is broken promise number three. In fact, right now, it is not even telling Canadians how much it is spending, when it is spending it, and what exactly it is spending it on. It is almost as if we have to remind the government that the money actually does not belong to it.
I hope Canadians had a chance to hear about the parliamentary budget officer's report last week, which confirms all of these points. In fact, one of the staff in the parliamentary budget office, which is an independent office of Parliament, said in the 15 years he has been reviewing budgets, he cannot remember one that has been so deficient in the information that was provided to the public. In other words, the government is not being transparent with Canadians' tax dollars. Therefore, how can Canadians trust it? How can Canadians, who work so hard for their money, trust the government with their paycheques if it will not, at the most basic level, be transparent?
Canadians are also worried that there is just spending, but no actual plan. The problem is that, when a government borrows and spends without a plan, that little bit that it talked about turns into a lot very quickly. It already has. Therefore, Canadians are now asking when it will stop and how much will be enough.
The eminent Canadian economist, Jack Mintz, wrote on budget day that “Canada’s debt bomb has just gotten a lot bigger”. Why is that? It is because Canadians know borrowed money is not free. We have to pay for the privilege. Also, the more we borrow the more it costs and the less we have when a real crisis comes around the corner, and of course the less we have to pay for the things Canadians need, like health care, retirement income, and pensions.
All this borrowing leads us on this side of the House to another point. How are they going to pay it back? The Conservative opposition knows very well, and so do taxpayers, that today's deficits inevitably become tomorrow's taxes. Canadians know that the Liberals are taking more of their money now just to take more of their money later.
In fact, the government could not even wait until tomorrow. Taxes are already going up. Personal income taxes are up by $1.3 billion this year and will go up nearly twice that much next year to $2.4 billion. The Liberals are so proud of their tax on the so-called one per cent. Why would they be proud of raising anyone's taxes in Canada?
The bottom line is that the budget was not designed to help the middle class, as the Prime Minister had promised during the election campaign. It is instead a betrayal of the middle class. For example, the Liberal government is rolling back tax-free savings accounts, the single most important personal financial vehicle since RRSPs. Millions of Canadians use them. Almost 70% of Canadians who use them are low- and middle-income Canadians, but the Liberals are scaling them back. Why would the government want to do anything to discourage Canadians from investing in their retirement, doing the responsible thing?
On the other side, it is shuffling around child benefits, which have a proven record of success, and leaving thousands of families out in the cold. The universal child care benefit, which the Liberals are eliminating, was universal and it lifted hundreds of thousands of kids out of poverty. However, they cancelled it. Tax credits for arts classes and for fitness classes are gone. Families relied on them. These credits gave them a break.
Having said that, probably the biggest betrayal in this budget was to small business owners. Small business owners were promised time and time again during the election campaign by the Prime Minister that small business tax rates would be going down, but the Liberals have abandoned that promise to lower taxes on small businesses and, at the same time, cancelled the small business hiring tax break. In addition to that, payroll taxes are on their way up.
The Liberal government is even increasing taxes for students, children's sports activities, and charitable organizations. That is just the beginning, a preview of what is to come. It is a simple and irrefutable fact that if the Liberals are not willing to control their spending, they will eventually have to raise taxes.
Let us talk about the impact of this budget on young people who are, right now, facing employment challenges. Why would the government add to their debt burden by raising the taxes on textbooks and education? Young people get it. They do not need a 1970s fiscal policy of interventionist big government. Conservatives want everyone to encourage a new economy that flourishes with less government intervention, not more government intervention, and young Canadians understand that. They know that good ideas, solutions, new technologies, and new platforms come from entrepreneurs, from people who are willing to take risks with their new ideas. The government has suppressed that. This is just the beginning. This is just a preview of more to come. It is a simple, irrefutable fact that, if the Liberals are not willing to control their spending, they will eventually have to raise taxes more.
What can Canadians expect for all of this borrowed money and tax hikes? The short answer is that Canadians are not getting what they thought they had paid for. For all of its spending, this budget does little to address the real economic challenges Canada does face, including unemployment in manufacturing and in the natural resource sector. Our economy may be growing, but it is growing unevenly. The oil and gas industry alone has lost 100,000 jobs. Families in Alberta, Saskatchewan, and Newfoundland and Labrador are struggling. In fact, they are desperate. What Canada needs now is a job plan, but this budget is not it. The Liberals still, after all of these years, have not figured it out.
It is not governments that create jobs; it is the private sector that creates jobs. This idea that growing the size of government is the answer is just wrong. We need the government to grow the size of the private sector, and this budget does nothing to encourage the private sector to invest in the economy and create well-paying, high-quality jobs. The job of the government is to create the environment for the private sector to flourish, and then, frankly, it should step aside and let people succeed.
Yet, the government makes barely any mention of helping the natural resource sector, the industry where our economic problems lie and where solutions are needed today. It is offering no support for the manufacturing sector, which according to the latest job numbers, is where we are seeing very low growth, even with the low dollar. Instead, higher taxes, higher energy and input costs, with the threat of a carbon tax, and uncertainty in the approval process for energy infrastructure are driving investments away from Canada and out of these sectors.
If Canadian farmers are looking for a sign that the government respects the agricultural and agrifood business, they will not find it. There is not one word in the budget. The only new support for agriculture is not going to farmers; it is going to Ottawa bureaucrats. As for the Liberals' promised infrastructure plan—and I do not know if members know this—there is actually no new money for highways, roads, or ports. These are the kinds of trade-enhancing investments that Canada needs today to move our goods to market, and these are the ones that Conservatives funded when we were in government. It was a good idea then, and it is a good idea now.
Most troubling of all is the fact that the Liberals are cutting programs that are important to our national security. They are slashing funding to Canada's military, in a return to the Liberal decade of darkness, and delaying much-needed equipment for the men and women of Canada's military in favour of spending on special-interest projects. As new stories of terror attacks come in from around the world, the Liberal government announced that less than 1% of its $30 billion spending spree would go to public safety.
Make no mistake, the Liberal government is on the brink of causing real, long-term damage to our economy. Our Conservative members are not the only ones saying so. The Liberal government's budget landed with a thud on March 22.
The reaction ranged from disappointment to outright confusion, as Canadians struggled to understand what $30 billion of their tax money had just bought them, from the Ottawa Citizen, which said “Canada under [the new Prime Minister] is going to look a lot like Ontario under Dalton McGuinty and Kathleen Wynne”, to The Canadian Press, which said that the losers in this budget include small businesses, national defence, and Canadians who want a lower tax burden.
Dan Kelly, the head of the Canadian Federation of Independent Business, who represents hundreds of thousands of small business owners, said that budget 2016 is “brutal for small businesses”; and John Ivison, one of our favourite columnists at the National Post said—and I am quoting this because it was so good—“this budget is a broken pipeline of federal tax dollars, gushing money to numerous pet Liberal causes”. I could not have said it better myself.
However, I did. Let me quote myself. I might as well take the liberty of quoting myself. The Leader of the Opposition said, “This Budget is a nightmare...for taxpayers”.
Therefore, what should a responsible government be doing? The fact is that we live in a highly competitive economy. If Canada is not an attractive place to work and invest, opportunities will go elsewhere. In fact, they already are.
What should we be doing? We should be aggressively pursuing free trade. We should be streamlining regulations. We should be cutting taxes, not raising them. We should be approving job-creating projects in a responsible way. That is how we create jobs. This budget does none of that.
By borrowing $10 billion without a credible repayment plan, raising taxes on families, and throwing out barriers to job creation, this government has failed on its most important job: keeping Canada's economy strong. Canadians want true leadership to support the Canadian economy. This budget offers nothing but platitudes and promises.
Worse still, the Prime Minister and his team continue to throw up roadblocks to job-creating pipeline projects and the thousands of new jobs that come with them. In British Columbia, they are sending mixed messages on LNG. During his recent trip to Washington, the Prime Minister did not even bother to bring his natural resources minister along, despite the enormous stake that our energy and forestry industries have in a bilateral relationship.
We on this side of the House know that Canada should be making the private sector a partner, not a target. This will not cost the federal treasury a dollar but would create thousands of jobs. We should be supporting proper infrastructure spending that has a lasting impact, with transparent selection criteria. We should be pursuing free trade deals like the historic trans-Pacific partnership that will lead to $5 billion to $10 billion in long-term GDP growth. We should have an actual commitment to balancing the budget within the next four years. It can be done, because it has been done.
We on this side of the House know that it is possible to be fiscally responsible and create a strong business climate, and it is possible to do that while at the same time being compassionate, since the government has a responsibility to help the most vulnerable in society.
How do we know that? We know that because that is what our Conservative government did for the last decade. We steered Canada through the worst economic crisis since the Great Depression. We did it while lowering taxes to their lowest level in 50 years; creating 1.2 million net new jobs, 90% of which were in the private sector; balancing the budget as promised and leaving a surplus; successfully negotiating free trade agreements with 51 countries, including the European Union and the trans-Pacific partnership; and approving pipelines to the United States and the northern gateway pipeline to get oil to tidal water. We did it while pulling hundreds of thousands of children out of poverty with the universal child care benefit and, thanks to the late and greatly missed Jim Flaherty, doing more for the disabled than any other government in Canadian history.
We also did all of that while at the same time raising health care spending by 70%, raising direct benefits to Canadians to their highest levels in history, and raising transfers to the provinces and territories to their highest levels in history. We also concluded a historic multi-million dollar settlement for thalidomide survivors, and we concluded more first nation specific land claims than any other government in history.
We did it because we had a plan, a clear plan, and provided real economic leadership. Without real economic leadership, there is no means to pay for all of these important social programs that so many Canadians rely on when they need our compassion.
Therefore, as Her Majesty's loyal opposition, we will push the government. We will be loud, and we will encourage the government to do the same as we did, which is to have a plan, to be fiscally responsible, to live within its means, to unleash the private sector. If not, we will not have a strong economy, and without a strong economy, we cannot have a compassionate government.
On that note, I would like to conclude, and I also move:
That the motion be amended by deleting all the words after the word “That” and substituting the following:
“this House not approve the budgetary policy of the government as it:
A. includes a deficit of at least $29.4 billion;
B. contains wasteful spending;
C. has no plan to balance the books;
D. will fail to boost economic growth or create jobs; and
E. betrays the middle class by raising taxes on families, individuals and small businesses.”
