Mr. Speaker, I am pleased to have this opportunity to speak on some of the key initiatives in economic action plan 2013 no. 2.
Our government remains focused on the economy and creating jobs, all while keeping taxes low and returning to balanced budgets. The key to success is balancing the efforts to support job creation and economic growth while respecting commitments to reduce deficits and return to balanced budgets over the medium term.
With the help of Canada's economic action plan, Canada has experienced one of the best economic performances among the G7 countries, both during the global recession and throughout the recovery. Canada has created over one million net new jobs, nearly 90% full time and nearly 85% private sector, since the depth of the global recession in July 2009. This is the strongest job growth record in the G7. Not only that, but both the IMF and the OECD project Canada to have among the strongest growth in the G7 in the years ahead. In fact, the OECD recently projected that Canada will lead the G7 in growth in 2013.
Our government is also committed to keeping taxes low. Unlike the high-tax NDP and Liberals, our Conservative government believes in low taxes and leaving more money where it belongs, in the pockets of hard-working Canadian families and job-creating businesses. Since 2006 we have cut taxes over 160 times, reducing the overall tax burden to its lowest level in 50 years. Our strong record of tax relief has meant savings for a typical family of four in 2013 of over $3,200. Unfortunately, the NDP opposition thinks that higher taxes are the answer.
Just a couple of weeks ago the NDP leader reconfirmed his party's plan to impose a crippling tax hike on job creators and the millions of Canadians they employ, even as they continue to cope with a challenging global economy. As if imposing a $20-billion carbon tax on Canadians was not enough, the NDP leader has another multi-billion dollar tax hike he wants to impose. At a time of global economic uncertainty the NDP wants to take over $10 billion each year out of the pockets of Canadian entrepreneurs and businesses to fund big, bloated government schemes. This punishing NDP tax hike would target job creators, especially small and medium-sized companies with a nearly 50% increase in their tax bills.
When I was very young I started working for my father who had his own hardware wholesale business. Small business taxes at that time were crippling for him. While he managed to stay in business for many years, he always appreciated it when governments understood that small businesses were not in the business of feeding the government coffers. Their business is to sell goods and to employ people.
My father ran his own business over the course of 35 years. The periods of greatest growth were during times when business tax rates were reasonable and low. Our current Minister of Finance and our government understand this and that is why we continue to support job-creating businesses, like the one that I worked for when I was younger.
Of course I did not have to apply for the job. I was given the job automatically because my father owned the business, but I still worked hard. The business did well when it was not all about red tape and spending many hours working out the calculations needed to pay that kind of debt to the government. That is why I want to talk about the small business advantages that we are giving them and the tax increases that would kill jobs and stall Canada's economy. Clearly, Canadians cannot afford these risky tax-and-spend schemes. Thankfully, as I said, our Conservative government understands that high taxes are not the answer.
Our government also understands the importance of general fiscal responsibility. Indeed, before the global recession hit, our Conservative government paid down $37 billion in debt, bringing Canada's debt to its lowest level in 25 years. This fiscal prudence and impressive debt reduction placed Canada in the best possible position to weather the global recession.
When the global recession hit, we were able to respond quickly and effectively with Canada's economic action plan. While other countries continue to struggle with debt that is spiralling out of control, Canada is in the best fiscal position of any G7 nation. In fact, our net to GDP ratio in 2012 was 34.6%, the lowest level among G7 countries, the second lowest being Germany at 57.2%. We can see the gap there. The G7 average is 90.4%.
While the NDP and Liberals want to engage in reckless spending, our government is on track to return to balanced budgets in 2015. Our plan to return to balanced budgets is working.
In 2012-13, the deficit fell to $18.9 billion. This was down by more than one-quarter from the deficit of $26.3 billion in 2011-12, and down by nearly two-thirds from the $55.6 billion deficit recorded in 2009-10. Our government's responsible spending of taxpayer dollars played an important part in these results with direct program expenses falling by 1.2% from the prior year, and by 3.8% from 2010-11.
Overall, measures taken by our Conservative government since budget 2010 will result in a total ongoing savings of roughly $14 billion. This legislation builds on this effort. Bill C-4 will phase out inefficient and ineffective tax subsidies. One example is the labour-sponsored venture capital corporations tax credit. Indeed, a number of independent experts have recognized this subsidy as being ineffective when it comes to creating jobs and supporting Canadian businesses.
Members should not take my word for it. I will tell them what others are saying about this tax credit, the labour-sponsored venture capital corporations tax credit.
A recent paper by the Montreal Economic Institute says:
All things considered, labour-sponsored funds are financial instruments that fulfill neither their economic objectives, namely to make venture capital available to help Quebec businesses, nor their financial objectives of offering a good return to contributors, their performance being interesting only by taking into account the additional tax credit.
Jack Mintz, a respected economist, said:
These credits have not only been ineffective in generating more venture capital, but they have also helped finance poor projects that should have never been funded in the first place.
He said that in 2012.
The C.D. Howe Institute also recognized that providing tax relief to these funds has been:
...a disappointing use of taxpayers’ money. Such funds have been shown in multiple studies, including this one, to do a poor job of achieving public policy aims.
That is from the C.D. Howe Institute E-Brief of September 2012.
I also want to talk about closing tax loopholes, which is contained in Bill C-4, loopholes and other schemes that only benefit a select few. Closing these loopholes is important because when everyone pays their fair share, our tax rates can be kept low, which makes Canada a more attractive place to work, save and invest.
In fact, since 2006 and including measures proposed in economic action plan 2013, our government has closed over 75 tax loopholes. This will result in $2.5 billion in additional revenues in 2013-14, and more than $2.6 billion in 2014-15. Indeed, the legislative proposals in budget 2013 to close tax loopholes are estimated to raise $100 million in revenue in 2013-14, rising to over $270 million in 2017-18, for a total of close to $1 billion over the next five years.
Shamefully, the NDP has voted against every single attempt by our government to close tax loopholes since 2006. I am not sure why it is doing that. I do not think they understand the importance of the one million jobs that have been created since the depth of the recession.
We understand there is still more work to be done and that Canada is not immune to the kinds of global challenges that come from beyond our borders. That is why we are so convinced that our job-creating measures are important and that we need to continue along this track. That is why I believe the legislation should go forward quickly.
The House may know that I had the good fortune to work with our esteemed Minister of Finance, who has won global accolades around the world for his work, his fiscal responsibility, his understanding of Canada's economy and for making sure that we are leading the G7 on so many indicators. It is difficult to be humble on his behalf. The Minister of Finance is, I believe, responsible in large part for the major credit rating agencies giving Canada a rock solid AAA credit rating. Moody's, Fitch, and Standard and Poor's have all given Canada this solid rating. It is something we take for granted. Canadians do not think about that every day. They are able to go about their business knowing that our economy is well looked after by the Conservative government and this Minister of Finance. It is important for Canadians to understand that our commitment to balance the budget by 2015 is an important one. It is ambitious, but we have made that commitment. Ultimately, it enables us to keep taxes low. We have cut taxes 160 times.
Earlier today my colleague from Winnipeg South Centre was talking about her family and the fact that she is not only a chartered accountant but a mother and that she appreciates the measures our government has taken on both of those fronts. I would say too that it is about helping families. We are looking at many countries in Europe that cannot afford to give tax breaks to families. They cannot afford to offer tax credits such as the children's fitness tax credit, which I have taken advantage of with my own children, the new children's arts tax credit and the universal child care tax benefit. These are the kinds of things that help families, putting money directly into their pockets so that they can use those funds for whatever they feel is necessary.
That is the kind of choice we like to provide to parents. We would not be able to do that if we did not have a strong economy. It is all about jobs, the economy and maintaining that long-term economic growth and prosperity. That is why I wanted to speak to the bill today, Canada's economic action plan.
If I might, I would like to compare that to something the Liberal leader said over the summer. I believe it was at the Liberals' caucus retreat. When asked when he would release his plan for Canada's economy, he said that it was too soon for him to be talking about the economy. He did not plan to release that for a long time, possibly a couple more years, maybe before the next election.
It is a good thing that the Liberal Party is the third party in the House, because I cannot imagine a prime minister without a plan for the economy. He has been the Liberal leader for many months now, since the beginning of the year, and he apparently needs a few more years to come up with an economic plan.
I am so proud that we have a Prime Minister and a Minister of Finance in Canada who already have a plan, and that plan is working.
I would be happy to take questions, if there is time, and talk about my support for job creation and this bill's support for job creation and Canada's economic action plan, which is working.
