Scott Simms

[Budget Implementation Act, 2007, April 16th, 2007]

Mr. Speaker, therein lies the crux of one of the problems, equalization and the fair principle of it. The Constitution talks about equal services provided across the country based on a needs basis. Certainly the measures taken in 1977 with tax points, or as those members called it, back door equalization, was not back door for us. It--

[Budget Implementation Act, 2007, April 16th, 2007]

It is a lot of money, Mr. Speaker.

Nobody on that side would agree. We have to sell what we put out there, which is perhaps the politics of deception at its best.

[Budget Implementation Act, 2007, April 16th, 2007]

Mr. Speaker, I thank you for reminding me of the rules. I would like to extend my apologies to all members in this House.

In response to my hon. colleague's question, indeed it has been a tumultuous event over the last three years to say the least. When the whole idea of being principal beneficiaries started, we talked about the fact that under the Atlantic accords we would be able to prosper much like Alberta did back in the 1950s and the 1960s and become an economic powerhouse. The Prime Minister pointed out, and as a matter of fact the current Minister of Intergovernmental Affairs pointed out the same facts and she was quite right. I would be disappointed if I lived in Saskatchewan which is next door to Alberta because Saskatchewan with its oil resources now faces the cap. It was not faced by Albertans way back when. There is a question of fairness to be resolved.

In the case of Newfoundland and Labrador and Nova Scotia, the deals were signed. The offsets were agreed to right up to 2020 which covers a substantial part of development certainly for the oil and gas sector off Newfoundland and Labrador. The second part of that also helped in the case of Nova Scotia, which would be particularly disconcerting for it given that it is now in jeopardy.

Buried within the details as the economists point out is the implementation of these accords which the government says it is protecting. In fact, even the Minister of Finance said in a CBC interview that after 2012 we are done and that is it. Whatever happened to 2020? As I pointed out, even if it goes to 2020 under the new formula, we are getting $1 billion less despite the fact that there were no caps, there were no hindrances whatsoever. We were 100% beneficiaries.

The government even said that the province would not be worse off, yet we are getting $1 billion less. One billion dollars sounds like quite a bit of money. I am sure my colleague from Cape Breton would agree.

[Budget Implementation Act, 2007, April 16th, 2007]

Through you, Mr. Speaker, I would like to address this to two members in the House, to the member of Parliament for South Shore—St. Margaret's and to the member of Parliament for Avalon who are present here.

Did they hear what was just said? How dare we actually go beyond the level of prosperity of Ontario. Let us look at the situation we have here. The fiscal capacity cap which the Conservatives illustrated so eloquently during the campaign that this was not an issue and that they would never impose it, yet here we have it right in our laps.

I do not think the member really understands the true nature of the Atlantic accord and the whole nature of being principal beneficiaries of which his leader preached for years, not just Newfoundland and Labrador, not just Nova Scotia, but Saskatchewan as well and British Columbia and the whole country. Yet the Conservatives have created this fiscal imbalance that exists between provinces. That is what they are doing, juxtaposing one province against the other. This is not the way this federation is supposed to work, yet they turn it around.

I would suggest to the hon. member in this situation that the Atlantic accord is not protected. As my hon. colleague pointed out a few weeks back, he probably does not know the difference between the Atlantic accord and a Honda Accord for goodness' sake. He seems to think it is protected but the independent economists says it is not. And there are caps implied within it.

I suggest at this point that the hon. member touch base with his hon. colleagues from Atlantic Canada who do understand what this is about.

[Budget Implementation Act, 2007, April 16th, 2007]

Do not say no. The member for Peterborough would like to say no but he does not understand it.

I would suggest that the member go to downtown Peterborough, talk to the people at Haaseltons Coffee & Sweets and find out just how the budget is not selling to the people of southern Ontario as well as Newfoundland and Labrador.

Every province is supposed to be better off and yet an independent assessment by Dr. Wade Locke proves that is not true.

It seems to me that in this run up right now we also had a quote from the Minister of Finance during his budget speech. He said that the era of bickering between provinces is now over.

I would not say that our premier, Danny Williams, is bickering or that he is troubled. He is downright angry. As I have just pointed out, he has every right to be angry. He was promised in two campaigns that there would be a total exclusion of non-renewable resources, no caps, nothing of that sort, no hindrances.

If he had followed through on his promise, he would have given the province of Newfoundland $11 billion more than what it was to receive under the accord.

Let me illustrate just how angry the province of Newfoundland and Labrador is in light of us now being in an era of no bickering. Danny Williams is not the only premier. He just happens to be mine.

In a recent release on April 13 entitled “Federal Government Misled Province on Impact of New Equalization Program”, the minister of finance, Tom Marshall, said:

We identified this problem more than a week ago and immediately wrote the federal government seeking clarification. We have yet to hear back from them.

It is funny because they seemed to be quite chatty back in 2004 and 2005.

The fact that they don’t bother to respond to us, but manage to find the time to speak with and offer clarification to independent economists, is insulting to the elected government and people of Newfoundland and Labrador. The Government of Canada has an obligation to explain themselves.

It tried to but it did not work out.

The federal budget legislation contradicts everything we have been told by Ottawa.

The minister said it is increasingly clear that the cost of the Prime Minister’s broken promise is significant. Dr. Locke’s numbers suggest that the shortfall from the Prime Minister’s commitment is now $11 billion. What’s more, it appears to be more financially advantageous for the province to opt to stay with the existing equalization program as it provides approximately $1 billion more than the new equalization program.

But for all, the Minister of Fisheries and Oceans has said unequivocally that Newfoundland and Labrador would not be worse off. As a matter of fact, the Minister of Fisheries and Oceans put out a press release complimenting Dr. Locke on his findings before he ran those numbers again, before receiving all the information and clarification from the finance department of the Government of Canada. He was quite pleased that we were getting an additional $5 billion but yet not much has been said since we truly found out that we would be receiving $1 billion less.

Did the Minister of Fisheries and Oceans know or did he not know? Was he not properly briefed? It is a question for Newfoundlanders and Labradorians and certainly a question for his own riding of St. John's South—Mount Pearl.

The press release goes on to state:

These numbers contradict everything the federal government and [the] Fisheries and Oceans Minister..., in particular, have said since budget day.

Mr. Marshall also states:

Despite assurances from the Federal Minister of Finance that the accords would be protected, fundamental amendments to the legislation implementation implementing the 2005 Atlantic Accord agreement had been proposed without any consultation with the Government of Newfoundland and Labrador. These amendments can be found in the 'consequential amendments' section of the 2007 Federal Budget Implementation Act. Consequential amendments are normally reserved for housekeeping items to fix technical issues. It is not a place to shroud fundamental changes of this magnitude.

In other words, the second half, up to 2020, is now in jeopardy and hidden somewhere in the back of Bill C-52, this so-called implementation act.

I would like to thank the people of Newfoundland and Labrador for standing behind us 100%.

[Budget Implementation Act, 2007, April 16th, 2007]

Mr. Speaker, I appreciate the fact that I can voice my opinion on some very important issues. One is in particular to me and to my home province of Newfoundland and Labrador and it concerns the recent debacle about equalization.

I will quote the Minister of Finance who said in his speech on the budget, “We are keeping our commitments on equalization”. He said:

We are returning Equalization to a principled, formula-based program....As we promised, every province will be better off under the new plan. Under the new plan, provinces will get the greater of…

Notice he said, “As we promised, every province will be better off under the new plan”. Therein lies a very good point. Recently in Newfoundland and Labrador we received the opinion of an independent economist who stated quite clearly that we were not, in Newfoundland and Labrador. I will illustrate those points in a few moments.

Before I do, I want to bring up the issue of equalization and the imposing of a cap. On February 14, 2005, we signed the Atlantic accord agreements, which provides offset payments for Newfoundland and Labrador, allowing it to be the principle beneficiaries of our resources, particularly when it comes to oil and gas. I will quote from November 4, 2004. This is from the then leader of the Conservative Party, now Prime Minister. He stated:

Unfortunately, the solemn word of this Prime Minister turned out to be not good enough. The Prime Minister ignored letters from Premier Williams on June 10, August 5 and August 24 urging him to confirm his promise. Suddenly, the Prime Minister and his Minister of Natural Resources fell silent.

There is an eerie similarity between what was then and what is now. Let me go on to also say what the Prime Minister brought to the House in 2004. He said, “Additional annual payments that will ensure the province effectively retains 100% of its offshore revenues”. Therefore, he endorsed the fact that Newfoundland and Labrador should keep 100% of its royalties. Then he quoted the minister:

—for an eight-year period covering 2004-05 through 2011-12, subject to the provision that no such additional payments result in the fiscal capacity of the province exceeding that of the province of Ontario in any given year.

He goes on to say that the eight year time limit and the Ontario clause, which effectively is the cap, gutted the commitment made to the people of Newfoundland and Labrador during the election campaign. That is very interesting because the then leader of the Conservative Party now Prime Minister stated unequivocally in 2004, he did not agree with the idea of a cap. He goes on to give several examples from his own experiences. He said:

Why should Newfoundland's possibility of achieving levels of prosperity comparable to the rest of Canada be limited to an artificial eight year period? Remember in particular that these are in any case non-renewable resources that will run out. Why is the government so eager to ensure that Newfoundland and Labrador always remain below the economic level of Ontario?

Therefore, he is saying why should Newfoundland and Labrador be subject to a cap, when in fact they should be principle beneficiaries of their own resources?

However, all that I have said in the past little while and all the evidence that has been given here in the House on November 4, 2004, suggests unequivocally that the current Prime Minister did not believe in a cap.

Let us fast forward three years later, 2007. The budget states, and the Minister of Finance said this to the House:

A fiscal capacity cap will provide fairness by ensuring that Equalization payments do not result in a receiving province ending up with a fiscal capacity higher than a non-receiving province.

In other words, it is not to go above the level of Ontario currently in that situation.

What happened between 2004 and 2007 to change his mind? A couple of campaigns happened. In that campaign again they stated non-renewals out of the equation, no caps, no hindrances whatsoever, for it is Newfoundland and Labrador and Nova Scotia that should be the principal beneficiaries of their own resources.

I will go on to say what he also said. I am quoting the Prime Minister because I thought he made a good argument on why we should not have a cap, certainly for Nova Scotia, whether it be the natural gas projects, such as Deep Panuke, or in Newfoundland and Labrador, Hibernia, White Rose and Terra Nova. He said:

This is what happened in the case of my province of Alberta. Alberta discovered oil and gas in the 1940s and 1950s. Alberta was a have not province. From 1957 until 1965, Alberta received transfers from the equalization program.

Here is the key. This is good stuff. He went on to say:

Alberta was allowed to keep 100% of its oil royalties and there was no federal clawback.

In other words, Alberta was allowed to punch through any idea of the cap.

What has happened since then? As the Prime Minister pointed out:

This is what allowed Alberta to kick-start its economy, to expand and diversify, to build universities, to advance social services and to become one of the powerhouses of the 21st century Canadian economy.

That is a very good point for being a principal beneficiary of one's own resources.

If we look at the financial circumstances which Alberta is under today, it is quite astonishing and quite successful. Why? Because it was allowed to be the principal beneficiary of its own resources.

Today we find ourselves in this situation where Newfoundland is not allowed to receive that privilege.

The Prime Minister before he was here said that he was president of a company that should have understood. I would think that the current Prime Minister would understand as well given the fact that he speaks so eloquently of it. He said that when the Atlantic provinces rejected the latest federal offers, the caps, the limits and the exclusion, the government engaged in a clumsy divide and conquer tactic, a tactic that gave away its obvious objective of holding back the development of the Atlantic provinces.

The current government set out to fix this fiscal imbalance but it has created a brand new one: a fiscal imbalance between provinces, between those that are rich and those that are poor, but those are relative terms.

Many members in this House perhaps do not realize it but Newfoundland and Labrador, believe it or not, based on a per capita GDP export, has the highest in the country, not particularly poor but particularly in debt.

When we set out to negotiate the Atlantic accords, we knew that by 2020 we would become that economic powerhouse that the current Prime Minister bragged about Alberta being. We would be that place. We would be, as my colleague addressed, the economic jewel of the north Atlantic, buy we do that by taking ownership of our own resources and being that principal beneficiary.

I mentioned a while ago that an independent economist had several things to say about the situation going on now in the 2007 budget and the implementation act and he ran some numbers through. He got all his information and he looked at it and originally came out with a number that stated that if Newfoundland and Labrador went to the new equalization formula touted by the Minister of Finance and the Prime Minister, Newfoundland and Labrador would gain $5 billion into 2020. However, here is the catch. Several days later, after several inquisitions, Dr. Wade Locke came to realize that the new formula did not work that way.

Interestingly enough, prior to that, the Minister of Fisheries and Oceans, the regional minister of Newfoundland and Labrador, even praised Dr. Wade Locke by saying that the provinces do gain. However, when new information was brought forward last Friday, Dr. Wade Locke had a look at those numbers again and put out a release talking about what he had to look at. He said:

The Equalization changes contained in the 2007 budget gave the Government of Newfoundland and Labrador an option of which Equalization formula would apply.

However, s.84 of the budget implementation Act (C-52) makes a significant change to the 2005 Implementation Act...

This was the Atlantic accord deal that was reached when we were in government.

Section 84 states:

The definition “fiscal equalization payment” in section 18 of the Act is replaced by the following:

“fiscal equalization payment” means

(a) for the purposes of section 22, the fiscal equalization payment that would be received by the Province for a fiscal year if the amount of that payment were determined in accordance with section 3.2 of the Federal-Provincial Fiscal Arrangements Act, without regard to section 3.4 of that Act....

That is a very key point. That information was not available when he first ran his numbers.

Let us look from now until 2020. We did the Atlantic accord in two sections, until 2012 and then to be renewed, if still in equalization, until 2020. If those accords were left alone today this is what would follow.

Dr. Locke looked at three revenue streams coming into the provincial treasury of Newfoundland and Labrador. Oil revenue was one, the accord payments or offsets was the other and equalization. The total number came to $18.53 billion in that period over the Atlantic accord. I congratulate some of my colleagues who made that happen, particularly the member for Halifax West.

Dr. Locke took the $18.53 billion and the three revenue streams and put them into the new formula under the old assumptions. He came out with $22.76 billion. Yes, , there were over $5 billion extra with this new formula. However, after talking to finance officials, Dr. Locke brought forward several questions and put them in his release. He asked them the following:

In calculating the accord under the new arrangement, it is my interpretation that the province is entitled to receive the accord [payments] so long as it qualifies for equalization before the cap is imposed, rather than after. Is that correct?

Just last week federal officials said that the legislation before the House proposes that under the new arrangement the test for determining whether Newfoundland and Labrador qualifies for the 2005 accord is whether or not it would receive equalization payments under the base O'Brien formula, that is 50% of inclusion plus the cap--it is bad--effectively the cap on our accords.

If it received equalization under that formula, then the next steps would be taken to determine how much, in this case the offsets would be determined before the cap was applied. The cap is applied when equalization is calculated. This is a pre-cap issue.

Lo and behold, there is a new twist. Instead of $22.76 billion, after clarifying with federal finance what this is all about, the provinces will actually receive $17.5 billion. That is $1 billion less than what we would have received under the Atlantic accord.

Let me remind the House what was said by the Minister of Finance during his budget speech. He said:

As we promised, every province will be better off under the new plan. Under the new plan, provinces will get the greater of--

However, the provinces were not. They are actually losing money under the new--

[The Budget, March 29th, 2007]

Mr. Speaker, since the minister was so quick to get to his feet, I would like to remind him what he said since he thinks he read the budget.

He said, “We don't always have control of our own destiny. We all like to do things...So what do you do then, you make the best of the situation you have...”.

As a matter of fact, the member for Avalon said, “...politicians of all political stripes have made promises before...and many of them have broken the promises they have made, I mean it's not a new thing to a lot of people...”.

If two of his own members can admit to a promise made, a promise broken, why will the Minister of Finance not?

[The Budget, March 29th, 2007]

It is not my fault, Mr. Speaker, seriously.

[The Budget, March 29th, 2007]

Mr. Speaker, my question is for the Minister of Finance.

He stated in the budget that he would put an end to federal and provincial squabbling but not so. Will he write Rodney MacDonald, Lorne Calvert and Danny Williams and apologize for breaking his promise to be principal beneficiaries of their resources?

He attempted to flatter Danny Williams but the message from Danny Williams to him and the rest of Canada was quite clear: “Flaherty will get you nowhere”.

[Heritage Lighthouse Protection Act, March 27th, 2007]

Mr. Speaker, this is such a great issue not just for coastal Newfoundland and Labrador but for coastal Canada.

We have some of the greatest heritage celebrated in the world when it comes to certainly lighthouses and a perspective of history. I would also like to point out what a lot of people overlook. In tourism brochures and all over the place across western and eastern Canada, we have a tremendous heritage in central parts of Canada as well.

As my hon. colleague from Bruce—Grey—Owen Sound is certainly aware of, I think he has about eight lighthouses in his riding. Indeed, that tells us what kind of history we have with lighthouses, not only in east, west and north but also to the centre of this country.

At this point I would like to congratulate Senator Carney on her work on Bill S-220, an act to protect heritage lighthouses, introduced in December 2006. British Columbia Senator Pat Carney's bill will prevent heritage lighthouses that fall under federal jurisdiction from being altered, sold or destroyed without public consultation. Therein lies a fantastic idea, something that I do believe is long overdue.

I would like to point out and commend the work that has been done by the late Senator Forrestall who also did some tremendous work on this.

I would also like to take this time, since I am in a very complimentary mood, to share the compliments and share the hard work that has been done by all my colleagues, especially the ones from Nova Scotia. My colleague from Cape Breton—Canso has done a tremendous amount of work. My NDP colleague from Sackville—Eastern Shore has done quite a bit on this file. I would be remiss if I left out my friend and colleague from South Shore—St. Margaret's who has long been a champion for this. I commend him for it. Of course, my friend from Îles-de-la-Madeleine, how can I forget the east coast of Quebec where this is necessary.

In the spirit of all this congeniality, I would like to say that indeed we are supporting Bill S-220 for many reasons. I think some of it can be summarized in the hard work that people have done over the years to protect their heritage. Around Newfoundland and Labrador we have lighthouses dating back to being the focal point of coastal communities in the mid-1800s. Lighthouses go back to becoming the focal point of communities for sealers and fishermen all over the eastern parts of the country.

Of course, being from Newfoundland and Labrador, the oldest colony in North America, lighthouses have indeed been an intrinsic part of our past and will continue to be.

“Going Towards the Lights in Atlantic Canada” is a document by the Canadian Register of Historic Places written by Darin MacKinnon. He is the registrar of heritage places with Prince Edward Island and he makes some very good observations. First of all, he says, “Lighthouses stand out”. He says, “Those lonely sentinels are iconic”.

He goes on to say and this is my favourite quote from him and it is very true. He says, “They are beacons from our past”. Indeed they are beacons from our past and something that we should preserve for the future, not only for our children but also for generations to come, many years, 100, 200 years. We should take notice of this.

In 2004 Parks Canada with provincial and territorial partners launched the Canadian Register of Historic Places. It is a searchable online source of information for anybody who is interested in finding out in their nearest vicinity if indeed they do have lighthouses and where they can go and see them.

For those who have an interest in lighthouses and the deep history associated with them, I do not suppose any of my Saskatchewan colleagues would find too much online, but nonetheless we get the idea, whether it be from the Great Lakes to the Arctic.

There are light stations to dwell on. Two recent examples from CRHP listings from Newfoundland and Labrador highlight other buildings associated with lighthouses. I would be remiss if I did not mention one in my own riding which is the Long Point Light Station at Crow Head. It was recently designated in December 2006.

I would also like to point out something that my colleague from Cape Breton—Canso mentioned when he talked about the available funds. I do think and I would compel the government and governments to come, no matter what stripe or colour, to look into a designated fund for our lighthouses as historical pieces.

I understand the limitations. I certainly understand the challenges in doing this for in excess of 500 lighthouses, but as my honourable colleague from the Conservatives pointed out, there has to be something done to preserve the lighthouses that serve to be our beacons from the past.

Also, I will talk about Cape Bonavista, another one that goes way back to the early 1800s and how it has evolved over the years. Through time, it has become a major beacon on the northeast coast. It is not of federal jurisdiction; it is provincial. However, when it comes to lighthouses and protecting our culture, when did jurisdiction ever matter? This is an important issue. It is one that is necessary for each and every colleague in the House.

In the process for Bill S-220, both the Department of Fisheries and Oceans and Environment Canada asserted that there were 750 lighthouses in Canada which would require funding pursuant to the provisions of the bill. The figure has presumably been applied to the cost analysis conducted by these departments. However, on December 7, 2006, during the hearing of Bill S-220 by the Senate Standing Committee on Fisheries and Oceans, they pointed out that only 3% of our lighthouses across the nation had genuine heritage protection and only 12% even had partial protection. That exists for 583 of these lighthouses. These are statistics that we should keep in mind as we vote on the bill. I hope we get the support of all our colleagues in the House.

Why is this needed to protect heritage lighthouses? It is for the Government of Canada to examine, recognize, protect and maintain a highly significant group of heritage structures, something with which I cannot see anybody in this legislature or other legislatures across the country disagreeing.

Today, for an example, we also have a great bit of money and attention given to railway stations across the country for their heritage impact. We actually have more lighthouses designated than we do railway stations. Decades ago, the government decided to have a policy where it would recognize and support railway stations for heritage purposes. Today 166 heritage railway stations have been designated by the federal government.

Let us contrast and compare. Lighthouses are beacons of the past and we could say the same for trains and railway stations. Something along that magnitude is indeed required in this situation.

Other examples that we could use are Cape Sable lighthouse, Nova Scotia, Sambro Island gas house in Nova Scotia and Estevan Point in British Columbia. It is a fantastic place for many people along the coastline to see, to get a glimpse of the history and culture of which they do celebrate. I congratulate each and every participant who is involved in that.

Bill S-220 is needed too. There are three major points I will bring out, which is the main reason why we are here today to support the bill. First is to give the public a voice in protecting heritage lighthouses. Second is to provide a systematic and legally binding mechanism for the recognition and protection of lighthouses that are presently owned and operated by the federal government. That is why we are here today. Third, we should provide an opportunity for public consultation before authorization is given for the removal, alteration, destruction, sale, transfer or other disposition of a heritage lighthouse. That is a very necessary component.

Bill S-220 is a very important first step for this incentive. The funding needs to be addressed. In fact, I suggest that maybe the Standing Committee on Fisheries and Oceans could probably look at something along this magnitude if it has not done it before. Perhaps my hon. colleague can point it out. He has more experience on the committee than I do.

I do appreciate the comments in here today. I appreciate Senator Carney and the work that she has done. Indeed, this is something that we can easily support, and we do it with a great amount of enthusiasm.