Scott Brison

[Income Tax Act, March 9th, 1999]

Madam Speaker, I appreciate being able to speak early on the motion tonight. I understand the parliamentary secretary assisted in that and I am very much appreciative.

The motion is a very important motion that seeks to address a fundamental flaw in the Canadian tax code as we see it currently, the discrepancy between the tax treatment of political contributions and charitable contributions.

As a preface to my remarks, it is very important to recognize the importance of the role charitable organizations play in Canadian society. That role has increased in recent years in part due to both federal and provincial government cutbacks where we have been in a period of fiscal restraint.

The non-profit sector, the volunteer sector, has had to play a larger role in providing some of the basic services. For instance, in areas of health care organizations like the VON have been called on to play a larger role than perhaps they have ever had to play in the past.

I argue that not just the intentions of this motion are very important but that the government should be trying to engage the volunteer sector on almost every area of service delivery to ensure that we identify the needs of Canadians more effectively and also, through the volunteer sector, to can work more effectively in meeting those needs.

There are several facts I would like to provide to the House on this issue. The discrepancies are very clear. The maximum contribution amount eligible for credit with a charity is 50%. For political parties the amount eligible for credit is $1,150. On charitable or non-profit organization contributions it is 17% of the first $200 and 29% on gifts over $200. The largest possible tax credit is limited by 50% of the donor's actual taxable income.

On contributions to political parties it is 75% of the total if the total does not exceed $100; $75 plus 50% of the next $450 is eligible and the lesser of $300 plus one-third of the amount exceeding $550 or $500. Clearly at some levels of contributions there are significant advantages of contributing to a political party as opposed to a charity. My party is not opposed to political contributions. I encourage Canadians who are watching tonight to make contributions.

The issue before us tonight is one that specifically addresses the discrepancy between contributions to charities and the non-profit and volunteer sector and political organizations. In the next century it is argued that in most industrialized countries the volunteer sector will play a larger and larger role in society. Governments will be asked to do some things extraordinarily well and will be asked to do less in some other areas. If we are to provide that level of responsibility to the volunteer sector we have to provide with it some type of commensurate improvement in the tax treatment which would enable citizens to contribute to those worthy areas.

This is not the only area that needs to be addressed in terms of our treatment of charitable contributions. We believe the government should remove the remaining capital gains tax on gifts of publicly traded securities to registered charitable organizations. Our party has taken a strong position on this. We have recommended to the minister that he eliminate this capital gains tax on publicly traded shares.

These publicly traded securities have been a very attractive option in allowing a philanthropist to transfer some of their investment holdings to worthy organizations. The capital gains tax effectively reduces the incentive for these philanthropists to contribute to the causes that are very important to them and that are very important to Canadians. The government appeared to recognize the principle I am speaking of a year ago when it reduced the capital gains tax on contributions of publicly traded securities by 50%.

What we are asking the government to do now is carry that policy to its logical conclusion and completely eliminate that capital gains tax on contributions of publicly traded shares. The cost to the federal treasury of the initiative I am speaking of in forgone revenue would be less than $50 million per year. That strikes me as an eminently reasonable tax expenditure to encourage more Canadians to contribute publicly traded shares and to support many of the non-profit and volunteer sector institutions, including hospitals, universities and other worthy institutions that are very important to the quality of life for Canadians.

This motion addresses one area of tax policy that we would like to see corrected. As I discussed, we have been pushing for the government to eliminate as well the capital gains tax on contributions of publicly traded shares to Canadian charities. These are some of the steps whereby the government could provide a recognition of the importance that Canada's volunteer sector provides to Canadians and the important level of services provided to Canadians by Canada's volunteer sector.

It is very important to recognize the trend of the increasing role that our volunteer sector is asked to play in society. The House would do itself proud to support this motion and to make steps in any way we can to encourage more Canadians to contribute to the volunteer sector which improves the quality of life of Canadians every day.

[Atlantic Theatre Festival, March 9th, 1999]

Mr. Speaker, the Atlantic Theatre Festival in Wolfville, Nova Scotia has developed a sterling reputation over four seasons of operation as a Canadian leader in quality classical theatre. In recent months a fifth season was in doubt due to financial difficulties.

However, the festival has succeed in overcoming these challenges and will launch a fifth season this summer. The response of the community has been a significant factor in this effort. All levels of government, the corporate sector and the private sector responded to the call for help. Most important, community residents themselves got together and worked hard to ensure the continuation of this great theatre company.

The festival injects an estimated $10 million into the local economy each year. This impact will only grow as the theatre seeks to broaden its activities to ensure that the entire community has access to the facility.

Nova Scotia and Canada look forward to another remarkable season of classical theatre in Wolfville, Nova Scotia. Congratulations to the Atlantic Theatre Festival.

[Federal-Provincial Fiscal Arrangements Act, March 9th, 1999]

Mr. Speaker, perhaps it is a generation gap but the hon. member prefers to focus on the past and I prefer to focus on the future.

The fact is that in 1984, if the hon. member checks his facts, the Conservative government inherited a $38 billion deficit in 1984 dollars. It was a far higher deficit than what the Conservatives left in 1993 at $38 billion. In fact as a percentage of GDP that deficit was almost half, from 9% of GDP to about 5%. Government program spending was reduced from where it was growing by 15% per year to zero program spending growth by the Conservatives that recognized the importance of debt and deficits.

In 1988 the hon. member's party started attacking these policies by dividing the right in Canada. It ran a candidate—I think this gentleman is now the leader of the party he decided to wind down—against the current leader of our party on the free trade debate and split the right on the fundamental issue of free trade.

It is very sad that members of his party not only choose to focus on the past instead of the future, but even when it does so it does not have its facts straight.

[Federal-Provincial Fiscal Arrangements Act, March 9th, 1999]

Mr. Speaker, I appreciate the question of the hon. member for Elk Island. He is quite right that the Conservatives should have been in government a lot longer to pursue these types of important policies.

I am sure if he had longer to ask his question he probably would have pointed out that the Progressive Conservatives were very busy making structural changes in the Canadian economy including free trade, the elimination of the manufacturers sales tax, deregulation of financial services, transportation and energy, those policies that ultimately enabled the government opposite to eliminate the deficit.

I appreciate the hon. member's intervention. I would hope, perhaps with his support and the support of members sitting with his party, that we could return to the days when we had an extraordinarily active public policy government that actually developed visionary changes necessary for Canadians. Right now it is not happening.

I am sure if the member had longer to ask his question he would have pointed out the fact that there has not been a single visionary policy from the Liberals since 1993. It has been a status quo, caretakership government without vision.

I am sure if he had longer to ask his question he would have pointed out the fact that the former Progressive Conservative government was busy making important structural changes and if it would have had just a little more time it would have probably pursued the necessary fundamental changes we are discussing as the Progressive Conservative Party of 1999.

[Federal-Provincial Fiscal Arrangements Act, March 9th, 1999]

Mr. Speaker, it is with pleasure that I rise today to speak to the equalization issue and to Bill C-65.

Equalization is a cornerstone of Canadian social policy. I believe most members of the House recognize that the free market system is a viable and important system for all Canadians to improve their qualities of life individually and collectively. The free market system will work only if all Canadians have access to the levers of a free market system and have approximate equality of opportunity across this country, regardless of where they live, and that is what equalization is all about. The concept of providing effectively level taxation or similar taxation and similar levels of services across this country is a cornerstone of Canadian social policy.

As a reflection of this importance, equalization is the only transfer program that is actually enshrined in the Constitution act. The goal of equalization, of providing equality of opportunity across Canada, is extraordinarily important. We should also recognize that a goal of equalization should be to provide a ladder for provinces and individuals in those province, those recipient provinces, to rise from their status as recipient to the point that they can participate in the free market economy fully. The equalization system should under no circumstance provide barriers to success, roadblocks to success for individuals and provinces as they try to bootstrap themselves into a more prosperous economy.

One of my concerns about Bill C-65 and the equalization formula is that there are direct disincentives for recipient provinces to improve their economies. For instance, in provinces like Nova Scotia and Newfoundland, which have the potential and will be enjoying increased resource revenues, those resource revenues will come off equalization.

The government has addressed the issue partially by phasing in these clawbacks in equalization over a five year period, but five years is a very short period of time in terms of the development of economies. It took more than five years for the economies in Atlantic Canada, for instance, to develop negative spirals downward.

It will take more than five years for Atlantic Canadian economies to participate fully in the Canadian economy and to achieve the level of prosperity that other regions of the country take for granted. Yet the government has only partially addressed the issue of disincentives.

The government needs to encourage provinces to pursue economic activities that will bootstrap individual provinces into prosperity. Instead there are roadblocks to success.

This situation and how equalization provides these disincentives is somewhat analogous to the issue of single parents in any province who are on social assistance and who have an opportunity to work and succeed but see a direct financial disincentive to participating in or pursuing activities and taking a job because the government puts in place a direct disincentive through the tax system for them to do that.

In a perverse way our equalization system, as it is formulated now, can actually create and encourage a continued reliance and a continued roadblock to success for these provinces. That is perhaps the most fundamentally important issue in equalization which has not been addressed and needs to be.

Mr. Speaker, I am sharing my time with the hon. member for Richmond—Athabasca. I should have mentioned that at the beginning.

Another important criticism of the equalization program made by the C. D. Howe Institute has some merit. The C. D. Howe Institute has argued that poor citizens of rich provinces sometimes transfer money to rich citizens in poorer provinces. An example of this is an east Vancouver family living in poverty may end up paying money that will ultimately benefit an affluent Westmount family. That is one small nuance but one detail that has been ignored by the government in terms of the revision to equalization through Bill C-65.

The fact that equalization is based on, to a certain extent, the assessment of a province's capacity to produce in terms of revenues from the final product reduces the incentives for provinces to produce value added products. To actually add value and develop a better secondary manufacturing system within the provinces is reduced by equalization. Provinces are encouraged to sell raw resources in many cases as opposed to trying to add value in their province and create jobs and employment.

This is perverse. It is one way that the federal government, through a lack of leadership and vision, continues to promote policies that are flawed and are not providing the best possible opportunities for Canadians.

One area in which I have significant concern is population as a basis for cost of services. Equalization distributes the funds to the provinces on a per capita basis. For a province like Newfoundland, which has seen a significant exodus of people over the past several years and it is predicted to continue for the foreseeable future, it is grossly unfair and inconsistent with the principles of equalization.

The actual fixed costs of providing services such as health care and education in a province, even when the population decreases, remain fairly consistent for a long period of time because of the fixed nature of those costs.

We would like to see in an equalization formula some accounting for the actual cost of delivery of services. Both Germany and Australia take into account the actual cost of delivery of services. Some of the socioeconomic factors, some of the demographic factors and the rural-urban make-up are issues that should be considered in equalization, not purely population as is proposed here.

One of the biggest flaws in the whole equalization argument has been around the issue of transparency. The fact that the government in recent weeks has engaged in a meaningful effort to dialogue and debate on equalization and on this fundamental issue, a program that costs $9 billion per year, is indicative of the government's continued knee-jerk, crisis management reactionary style of government. There is no vision. We may have a budget surplus but there continues to be a leadership deficit.

We are concerned by the fact that the government, instead of debating the issue and discussing the issue over the past five year and trying to come up with a equalization plan that provides all regions of the country with opportunities to succeed, continues with the same old, tired policies that we need to revisit. If we are ingenuous about giving opportunities to recipient provinces and if we are ingenuous about eliminating barriers to success, it will take more than a few hours of debate in the House of Commons and some witnesses appearing before the House of Commons finance committee.

The issue of gambling revenues is another important one. Bill C-65 will take into account gambling revenues in the provinces. The fact is that many of the social costs of gambling are provincially borne costs, whether in health care or in social program spending. This could have a very negative impact on provinces that currently benefit from gambling revenues.

We need a new visionary approach to equalization, a new equalization program that provides a ladder to success and not barriers to success as this one does. We believe in equalization. Our party believes that an equalization program is necessary and that we should continue to protect and encourage equalization as a tenet of Canadian social policy. We can make it better as parliamentarians. In that light I would move:

That the motion be amended by deleting all the words after “that” and substituting therefor:

Bill C-65, an act to amend the Federal-Provincial Fiscal Arrangements Act, be not now read a third time but be referred back to a committee of the whole House for the purpose of considering amendments to clause 2 to alter the equalization formula to fairly take into account the varying costs of program delivery in different provinces because of differing demographics, geography and urban-rural variations in addition to population; and to clause 2(2), which would eliminate the current disincentives for recipient provinces to improve their finances through innovative economic policies.

[Employment Insurance Act, March 5th, 1999]

An hon. member from the Reform Party is saying that the government has not paid down the deficit. Perhaps as a member of the House of Commons finance committee he should consider that there is a difference between deficit and debt. I think the member means the government has not paid down the debt. The member does not understand the difference between deficit and debt, but that is all right. I guess one does not have to understand economics to be in the House of Commons or on the finance committee.

The employment insurance issue is fundamental for a number of reasons. First, labour market flexibility is extraordinarily important in the new economy. I commend the hon. member for this piece of legislation. It has the potential by creating a new independent commission to set rates separate from politics and separate from the finance minister and the government in power. Labour and management in small business can set rates which best reflect the realities of the market in a particular area of the country at a particular time. That is very important.

Labour market flexibility depends largely on employment insurance programs and training. One of the failures of the government in terms of the slashing of EI benefits has been its complete abdication of responsibility for training. There has been an offloading to the provinces in the area of training.

It is fundamentally wrong that in order to qualify for training someone actually has to be on employment insurance and in order to get employment insurance has to be laid off. Many small and medium size companies across the country would like to have their employees participate in training but currently they do not benefit from it. The training components are failing on a national level and the cuts to EI have been a significant part of that.

The commission should have the ability to determine both the premiums rates and the nature of programs. I feel an autonomous commission could better determine how premiums could be spent through the programs.

One of the shifts I would like to see in EI is from almost pure income support to a focus on training. We could develop a mandate that recognizes the importance not just of income support but also of training such that people are able to access the levers of the new economy and of an economy that will be changing at an ever-increasing pace in the future.

The issue of seasonal work is another issue the government has largely ignored. It has punished Canadians who are involved in seasonal work. Many sectors in Atlantic Canada, including agriculture, the fisheries and small business, have over a period of years developed along the lines of seasonal employment. The government cut EI premiums, particularly challenging those involved in seasonal employment, without providing any structural alternative to those programs for those people.

Seasonal workers in Atlantic Canada were hit extraordinarily hard. I heard the hon. member for Dartmouth say earlier that there was a $716 million loss to Nova Scotians. I would posit that loss was largely felt by those involved in seasonal employment: people working for farms in the Annapolis Valley, people working in the fisheries, people working for small business. Small businesses, farms, fish processors and other employees bore the brunt of those cuts.

Did the government create a new agency or co-ordinating body to help co-ordinate seasonal work such that seasonal workers like people involved in agriculture in the summer could potentially participate in forestry work in the winter? No, it did not do anything. It effectively cut the money but did not replace it with vision or with a commitment to new and visionary programs and better government. Instead it reduced the size of government.

It is not all about the size of government. Sometimes we have to talk about the role of government and the effectiveness of government. One of the areas in which the government could have played a more active role and could still play a more active role in is the creation of a pilot program in Atlantic Canada aimed at creating an agency that effectively co-ordinates seasonal workers so that those employed in such sectors as agriculture in the summer could have an opportunity to participate in other types of seasonal work like the forestry in the winter.

It would be able to effectively take those people who have been treated shoddily by the draconian cuts to the program and provide them with a sense of hope and a sense of opportunity by helping them focus their efforts on participating in the economy.

There are people with mortgages in my constituency who are trying to raise families, in many cases two or three children. They have effectively seen their incomes halved by the changes the government made to EI. They are struggling with $6,000 or $7,000 per year or less. That is a reality. That exists in many areas of Canada, not just in inner cities but in poor rural communities. It is a significant challenge.

We as a party have a fundamental belief in the free market economy, but a free market economy is not sustainable unless all members of society have access to the levers of that economy and equality of opportunity. If the EI program were properly structured, it could help provide access to those levers.

The creation of a separate commission would be a great step forward. Ultimately the decision making powers would be with those people affected most by the EI fund. We would assert that the employers and the employees are the correct proprietors of that fund. It would deny governments of any political stripe the opportunity to use the fund for politically motivated purposes.

At a time when there will be change in the workplace and change in the economy it would provide, for instance, opportunities for the EI fund to be focused on new and exciting areas, including providing Canadians with an opportunity to train and retrain throughout their lives. Those are the types of changes that are necessary.

I am not confident the government will make those types of changes. As long as it keeps EI premiums unnecessarily and offensively high and reduces benefits significantly without replacing them with any type of vision for the future, I do not think the government will ever engage in creative policy development focused on achieving the full potential of the EI program.

I would hope all members of the House consider the legislation very carefully and its potential in the long term. The government has taken $19 billion from the EI fund over the past several years to pad its own books. The past is the past. It is hard to change that now, but we do have an opportunity where we are emerging into a post-deficit situation where we can focus on doing the right thing.

Bill C-299 would be one of the first steps toward making the right decisions in the future to ensure that all Canadians and employers and employees benefit from the good public policy that we developed.

[Employment Insurance Act, March 5th, 1999]

Mr. Speaker, it is with pleasure that I rise to speak on Bill C-299.

Payroll taxes are one of the most significant impediments to job growth in Canada. By directly increasing the cost of labour, we ultimately decrease the demand for labour. That is one of the reasons Canada's unemployment rate continues to be stubbornly high.

This government has stubbornly clung to unrealistically high EI premiums in order to pay down the deficit. While we laud the efforts to pay down the deficit, effectively the government through its policies, by paying down the deficit, by raising and maintaining unnecessarily high taxes and at the same time cutting spending on programs like the EI, has put the government in the black and perversely Canadians in the red.

[Taxation, March 4th, 1999]

Mr. Speaker, “parents who make the sacrifices and deliver quality care have earned the right to get support”. These are the words of the Liberal member for Mississauga South.

He went further to say that our tax system discriminates against families that choose to provide parental care. Why does the Liberal government not listen to a member of its own party and end its discriminatory tax treatment against single income families?

[Supply, March 4th, 1999]

Madam Speaker, does the hon. member agree that while we should eliminate the current discriminatory policy, we should not create another discriminatory policy which actually favours single income families?

I was the youngest of four children. My mother was a great mom and was also a partner in a business for the first three children. She worked hard as a mother. She raised me as a full time homemaker after they sold their business. My three older siblings ended up being very successful and I ended up in politics. I am not certain we should necessarily be encouraging one or the other if it has that kind of effect.

[Supply, March 4th, 1999]

Mr. Speaker, after work a woman should have the right to go wherever she wants to go. That is my opinion.

With respect to the other issue, the government has clearly created a tax policy that discriminates against stay at home parenting.

Further to my point that it should be a matter of choice, depending on the parents, in some cases it might be better for both parents to work if the children have appropriate care.

I will give one brief example. My mother and father raised four children. I am the youngest. Until 1968, for 23 years, they had a business, a store. My mother was an equal partner with my father in that store and she worked day and night. The first three children did not really have a stay at home parent.