Mr. Paul Zed (Parliamentary Secretary to Leader of the Government in the House of Commons, Lib.): Madam Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government's response to six petitions.

* * *

COMMITTEES OF THE HOUSE

NATIONAL DEFENCE AND VETERANS AFFAIRS

Ms. Mary Clancy (Halifax, Lib.): Madam Speaker, I have the honour to present to the House, in both official languages, the first report of the Standing Committee on National Defence and Veterans Affairs.

[English]

Pursuant to an order of reference dated Wednesday, February 3, 1997, the committee has studied Bill C-300, the volunteer Canadian service medal for United Nations peacekeeping act, and has agreed to report it with amendments and with much thanks to the member for Saanich-Gulf Islands.

* * *

CANADIAN CHARTER OF DUTIES AND RESPONSIBILITIES

Mr. Garry Breitkreuz (Yorkton-Melville, Ref.) moved for leave to introduce Bill C-388, an act to establish a Canadian charter of duties and responsibilities.

He said: Madam Speaker, one of the main problems I have identified in my research is that there are legal documents which describe the rights of Canadian citizens in great detail, but no legal document which describes their responsibilities. Consequently, Canadians are becoming more and more preoccupied with their rights, which is creating an unhealthy entitlement mentality in our society.

Today I am introducing a private member's bill entitled the Canadian charter of duties and responsibilities. My long term goal is to improve the balance between self-interest and public interest and to encourage a sense of trust, responsibility and generosity of spirit among all Canadians.

The specific purpose of my bill is to remind Canadians, every time they apply for a federal program, of this simple reality: we cannot continue to enjoy our rights until and unless we continue to fulfil our responsibilities.

My bill describes in very general terms 16 fundamental duties of citizenship and every time a citizen or permanent resident of Canada seeks any financial assistance from the federal government they will be required to sign a statement of duties and responsibilities. This routine process will serve as a regular reminder that the benefits of being Canadian also mean meeting one's obligation to our country, our communities and our families.

My bill will also ensure that all federal legislation is consistent with the principle that rights and freedoms must be balanced with duties and responsibilities.

(Motions deemed adopted, bill read the first time and printed.)

* * *

(1010)

DIVORCE ACT

Mr. Paul Szabo (Mississauga South, Lib.): moved for leave to introduce Bill C-389, an act to amend the Divorce Act (marriage counselling required before divorce granted).

He said: Mr. Speaker, this month the Vanier Institute on the Family reported that one out of every two marriages in Canada ends up in divorce and that 50 per cent of children will experience family breakdown before their 18th birthday. It also reported that 23 per cent of families in Canada are lone parent families and account for some 46 per cent of all children living in poverty.

This private member's bill seeks to amend the Divorce Act to require that spouses attend marriage counselling before a divorce is

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granted, unless grounds of mental or physical cruelty are present or the court is satisfied that it is impossible or inappropriate for them both to take counselling. The issue here is not the divorced couple but the children.

Children of divorced parents are two to three times more likely to experience poverty and insecurity. They experience negative impact on their capacity to love. They are less likely to go to college or university. I could go on.

I want to conclude by saying that the children are the real victims of divorce, that mandatory counselling will provide reasonable guidance to ensure that a viable parenting plan is in place and that the acrimony in divorce is mitigated as much as possible.

(Motions deemed adopted, bill read the first time and printed.)

* * *

[Translation]

PETITIONS

NATIONAL HIGHWAY SYSTEM

Mr. Gilbert Fillion (Chicoutimi, BQ): Madam Speaker, pursuant to Standing Order 36, I have two petitions to table this morning.

The first one deals with the national highway system, 38 per cent of which is substandard. The petitioners point out that the national highway policy study identified job creation, economic development, saving lives, preventing injury and, more importantly, improving Canada's competitiveness on international markets as benefits of the proposed national highway program.

Therefore, constituents in my riding are calling on the federal government to join with the provincial governments in upgrading the national highway system.

GASOLINE TAX

Mr. Gilbert Fillion (Chicoutimi, BQ): Madam Speaker, the second petition points out that the availability of sources of affordable fuel is a natural advantage to Canadians in reducing the high cost of shipping over long distances between source and market.

In addition, Canadians are paying approximately 52 per cent of the cost of a litre of gasoline in the form of taxes and the excise tax went up by 1.5 cent a litre in the last budget of 1996.

Constituents in my riding therefore request that Parliament not increase the federal excise tax on gasoline in the coming year.

[English]

EMERGENCY PERSONNEL

Mr. Paul Szabo (Mississauga South, Lib.): Madam Speaker, I have two petitions today. The first comes from Guelph, Ontario. The petitioners draw to the attention of the House that our police officers and firefighters place their lives at risk on a daily basis as they serve the emergency needs of all Canadians.

They also state that in many cases the families of officers killed in the line of duty are often left without sufficient financial means to meet their obligations.

The petitioners therefore pray and call on Parliament to establish a public safety officers compensation fund to receive gifts and requests for the benefit of families of police officers and firefighters killed in the line of duty.

TAXATION

Mr. Paul Szabo (Mississauga South, Lib.): Madam Speaker, the second petition comes from Winnipeg, Manitoba.

The petitioners draw to the attention of the House that managing the family home and caring for preschool children is an honourable profession which has not been recognized for its value to our society.

The petitioners therefore pray and call on Parliament to pursue initiatives to assist families that choose to provide care in the home for preschool children, the chronically ill, the aged or the disabled.

* * *

(1015 )

[Translation]

QUESTIONS ON THE ORDER PAPER

Mr. Paul Zed (Parliamentary Secretary to Leader of the Government in the House of Commons, Lib.): Madam Speaker, I suggest that all the questions be allowed to stand.

The Acting Speaker (Mrs. Ringuette-Maltais): Is it agreed?

Some hon. members: Agreed.

_____________________________________________

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GOVERNMENT ORDERS

[English]

THE BUDGET

FINANCIAL STATEMENT OF MINISTER OF FINANCE

The House resumed from February 20 consideration of the motion that this House approves in general the budgetary policy of the government; and on the amendment.

Mr. Gary Pillitteri (Niagara Falls, Lib.): Madam Speaker, I will be sharing my time with the member for Fredericton-York-Sunbury.

We all know that budgets are delivered to the House of Commons and the nation as a whole, but budgets are lived every day

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within communities throughout our country. This budget, in my opinion, has encountered a very positive response in the homes and workplaces of many families of my constituency, in fact, in hundreds of thousands of families across the nation.

This time the government did not speak to the corporate boardrooms of the nation nor did it speak to the international money making organizations, important as they may be. It spoke instead to the homes and families which are the real strength in the country. When we speak of families, every parent across the country will tell us that their greatest concern is the well-being and future of their children. The budget addresses the future of Canada's children.

In the budget, the Liberal government proposes a two-step enrichment of the current child tax benefit. What an historic undertaking, two levels of government committing to a new cross Canada child benefit system.

By investing in our children, we reflect Canadian values and priorities and make our investment in a stronger society. I am very proud that the budget allocates $230 million over the next three years to assist the disabled. Canadians with disabilities face real barriers. However, they do not seek any special treatment. They seek equal citizenship and need our support to secure it. For this important reason, the medical expense tax credit has been broadened.

In the budget, the finance minister addresses important family issues with his championing of medicare and his aid to the most in need among us.

My riding of Niagara Falls was lucky enough to be represented in the House by another champion of medicare. I am referring to the Hon. Judy LaMarsh, who was responsible for some of the most innovative legislation within the Pearson government. It was under her guidance, as minister of national health and welfare in 1963-65 that the Canada pension plan was implemented and Canada's medicare system was designed.

Recently, and always under a Liberal government, we have learned from the National Forum on Health that the money spent on health in Canada is more than sufficient. There is, however, a lot of evidence that the money is not being spent as effectively and efficiently as it could be. The budget has listened to this and is providing funds that will help to pave the way for more effective and efficient health care system which will bring Canada into the 21st century.

Despite the over 700,000 new jobs created since 1993, we strongly believe that the unemployment rate remains too high. What parent, as head of a family, is not concerned with how they make their daily bread? The budget addresses job creation, jobs which support the dignity of individuals as no one enjoys being unemployed, jobs which allow the breadwinners to give their families a decent standard of living, and jobs that will allow family members to contribute to the new revitalized Canada pension plan for which, Mr. Prime Minister, we all thank you today. The tourism sector is a very important component for the creation of jobs in the Niagara region. The industry is expected to grow by 125,000 new jobs in the coming years and the budget allocates $95 million for this very purpose.

(1020 )

My constituency of Niagara Falls borders the U.S. and it has some of the most spectacular scenery in the world. I must admit that the budget's support and encouragement of tourism is good news for my constituency and for all the Niagara peninsula. The help provided in the budget to the tourism industry will be great for all of Canada. Is it not true that almost every constituency in Canada is a tourist destination?

Tourism is more that just the scenery. By working in conjunction with the aid provided to tourism by the Liberal government we will succeed in making our cities, towns and villages equal to our scenery as places for tourists to see and enjoy.

We are building our tourism industry not only for visitors from abroad but for Canadians who will then be able to meet and discover one another and explore each other's culture. I firmly believe that inter-Canadian tourism can do much more to knit the country together than all the politicians and constitutional lawyers will ever be able to do.

As our cities, towns and village grow older and our population stabilizes we have to renew and rebuild much of our infrastructure system and the budget has recognized this. Even the most right wing of private enterprise supporters would have to agree that if there is a place for government spending it has to be on infrastructure. It must be the streets, roads, bridges and schools. As we all know, those are not in the areas where enterprises excel.

Our families need good infrastructure for improved health care, education and safety. Businesses need good infrastructure to become more competitive and to create the profits which in turn will supply the economy with jobs and revenue. My appreciation, and I am sure the appreciation of millions of Canadians, goes out to the Liberal government for recognizing the need of this basic stepping stone for reaching the 21st century.

Lower interest rates are expected to generate between 300,000 and 350,000 new jobs this year. They have translated into real savings and real benefits to individuals and business alike. Furthermore, the measures announced in our fourth budget cannot but facilitate greatly the task of small business in creating jobs.

Speaking of small business, I would like to address the farming community and its constituents who in most cases are small or medium sized business owners. I am sure they will appreciate the budget measures geared to the Farm Credit Corporation, which will enhance economic growth in rural Canada by providing specialized and personalized services to farming operations. Family farms

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and small and medium sized businesses that are related to farming will then be able to benefit from it. Increases in the Farm Credit Corporation's lending activities will help to enhance the economic development of rural Canada, particularly the agri-food sector.

(1025 )

In conclusion, when we took office Canadians knew that tough decisions and fundamental changes were required. Canadians did not want any tinkering. They asked for lasting solutions. They wanted us to develop a plan and stick to it. With our fourth budget we have done just that and we are continuing to do so because we know we are on the right track.

One of our greatest prime ministers, Sir Wilfrid Laurier, said that the the 20th century belonged to Canada, and it surely has. However, our work is not complete. Our record is not perfect, but it shows that the Liberal government has taken its commitments very seriously. Our current Prime Minister and Minister of Finance have with this budget staked out our claim which will successfully lead Canada and all Canadians into the 21st century.

Mr. Jim Silye (Calgary Centre, Ref.): Madam Speaker, I have a comment and a question or two to ask of the member for Niagara Falls.

I know he is a businessman. I would like to make this analogy. He praises this budget. He says that it is a good budget and that he is proud of it. When the government first came into power its members talked about how they would reduce the deficit to 3 per cent of GDP. Somehow we thought the deficit was $38 billion but that was inflated to $42 billion.

According to the budget the deficit for the current year now stands at $19 billion. Would he agree with me that a deficit in a business can be stated as a loss? When the government took power the previous government had run up a loss of $42 billion. The Liberal government has now reduced that loss on an annual basis down to $19 billion.

The member is saying that he is proud of a budget, that he is proud of a business, that he is proud of a finance minister who brags about breaking the back of the deficit or that he is proud of a finance minister who loses on behalf of Canadians, who spends more money than he brings in by $19 billion.

How can the member say that he is proud of a budget that loses this kind of money when the whole criteria of a budget should be to get to a balanced budget, and the sooner the better. I know the member is a businessman. I know the member understands that he could not run at a loss for 30 straight years and keep adding to his debt unless he had unlimited natural resources in Niagara Falls. Maybe he does. I know Canada is rich as well. I do not understand how Liberal members can brag about a budget that brings in a loss of $19 billion.

The member talked about the serious commitment of the government. We found out yesterday that to reduce the deficit the government has cut transfers to provinces by $7.5 billion. That represented about 23 per cent of its overall deficit cutting regime. Then the government representatives said: ``Yes, we know it's tough to swallow. You provinces will have to handle it. You guys will have to work it out at lower levels yourselves and locally. But we're going to bite the bullet as well. We are going to reduce program spending and departmental spending by 18 per cent or so, by $9 billion''.

The government was supposed to cut regional development by 50 per cent but it is still the same. It is still half a billion dollars away on transport even though it has done a good job in that area. If the government is serious about its commitment, then why have the cuts to departmental spending, the government's spending within its own jurisdiction, not been made to their full extent? The cuts are only half of what they should be according to the member who said that the commitment was strong.

(1030 )

Mr. Pillitteri: Madam Speaker, I thank the hon. member for his excellent question.

When we went to an election in 1993 there was a $42 billion deficit. We stated at the time that we would bring our deficit down to 3 per cent of GDP, and we have done that. We are very proud of that. Not only have we done it, but we have excelled on it.

An hon. member: By tax increases.

Mr. Pillitteri: It was not by tax increases. We have done this by lowering spending on behalf of the government. We lowered our spending by a ratio of seven to one that we transferred to the provinces. The provinces were warned two years ahead that their transfers were going to be cut.

In comparison we cut our own spending by seven to one. We have not done this on the backs of Canadians, as the hon. member across the way and his party wanted to do it. We wanted to do it fairly. We wanted to do it slowly so that in actuality people would reflect and understand what we were doing. We did not want to burn and slash as the hon. member across the way wanted to do. We wanted to do it in a way that was fair to Canadians, and we have done so.

Our job is not finished yet. We want to continue and certainly we will continue because we are on the right track.

Mr. Andy Scott (Fredericton-York-Sunbury, Lib.): Madam Speaker, this is my first occasion to congratulate you on presenting yourself in that part of my constituency that has been transferred. I

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know you will represent those constituents in the future as ably as you have the people of Madawaska-Victoria.

In considering the budget we have to go back to 1995. I am sure that happens from time to time in circles on both sides of the ideological lines in terms of what the 1995 budget meant to Canada, what we have been able to accomplish, and what we have been unable to accomplish. I cannot disconnect the 1995 budget from our former colleague from Notre-Dame-de-Grâce. This is also the first opportunity I have had to pay tribute on the public record to someone who served this place with honour and integrity far in excess of the average.

The 1995 budget represented a challenge for many of us in the context that we had to do some very tough things. We had to exercise vigorous restraint on what we would like to consider Liberal programs. It did not come easily to us.

Because we did it we have found ourselves in a position where if the current deficit is not finished with the job must continue. We have to be vigilant to make sure that we retain our economic and fiscal sovereignty. Generally speaking it is considered to be manageable. All indications from outside observers would suggest that. That allows us to do some of the things the budget has done.

Specifically I refer to jobs. I will simply go through the list of things contained in the budget respecting jobs. There will be $95 million for tourism over three years; an extension for another year of the infrastructure program that was extremely helpful in terms of jobs and infrastructure development in Fredericton-York-Sunbury; a year of premium relief under the new hires program; a 10-cent premium reduction on EI premiums; $50 million for private sector infrastructure through the Business Development Bank; and $2 billion additional capital for the Small Businesses Loans Act. We often speak of the Canadian Foundation for Innovation and its impact on universities. It is a job generator in terms of the R and D opportunities in placing Canada in a position to compete at that level internationally.

(1035)

The opportunities fund which has been discussed with regard to disability is a program designed to allow Canadians with disabilities access to employment. The youth package was announced prior to the budget. The interest rate is low. All these things lend themselves to job creation in an environment that will see more jobs.

The second or third consecutive budget has attempted in a modest way, admittedly, to deal with the real problem of child poverty. In a relatively affluent society we have this anomaly. I do not mean to understate it. It is a terrible tragedy, but the real tragedy is that it could happen in a country as wealthy as this one. In the third successive way we have tried to deal with this problem in a modest way. It was recognized in the budget speech that we are just beginning and that it should be acknowledged.

In terms of universities and students I mentioned the innovation fund. We have done a number of things to make universities more accessible to deal with the problem of rising debt loads. We need to make sure that no one who is academically qualified to enter any post-secondary education institution is denied that access because of an inability to pay for that opportunity. We have had a very generous university program and that is one of the reasons Canada has been so successful.

It is important to recognize that there comes a point when the student loan program is not the answer. At some point a huge debt with high unemployment is an obstacle to a post-secondary education.

We mentioned the various responses that the budget contained with regard to the National Health Forum. These are opportunities to implement new programs or to enhance existing programs because we have made progress. The mission is not accomplished, but we have made progress in terms of dealing with the deficit.

I cannot let the opportunity pass by without speaking specifically of the 30 per cent increase in the money available for literacy. It is not something that has received a great deal of attention, but it is something very dear to my heart. Certainly the government has made literacy one of its major preoccupations and I welcome that.

In terms of the various things contained in the budget I bring attention to the announcements that related to Canadians with disabilities. As the chair of the government task force on disabilities I was very encouraged by the response of the government to our task force. I thank the four ministers who sponsored us and the many Canadians who appeared. Upward of 2,000 people from cities across Canada appeared before the task force to speak of what they believed the priorities of Canadians with disabilities should be.

Although it is a modest beginning, and I do not want to diminish in any way the extent to which the battle must continue, in reality the government did not break faith with all those people. It did not break faith with our task force that went in good faith across the country seeking advice. I am very happy the government has seen fit to recognize the work, to recognize the need and to respond with $230 million over three years in the budget. Approximately$100 million will be in the first year.

The budget exercise represents only a beginning. We found ourselves having to do things as a government that were borne of necessity. These were not ideological decisions. We had a deficit. I have always believed that the former government deflated the

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deficit to $38 billion in the last campaign. When we got here we found that it was actually $42 billion.

My colleague across the way sees it a different way, that it was a $38 billion deficit that we inflated to $42 billion. It is remarkable how one can look at the same numbers from different sides.

(1040 )

It is also remarkable that we have been given credit. Members across the way during the course of the debate have acknowledged that some effort has been undertaken and some progress has been made. However the progress is not an end in itself. It allows us to get our house in order so that we can do what government is supposed to do: to address inequity and to recognize that not everybody in Canada starts from the same place. The reality is that people differ whether it is by virtue of their capacity, where they happen to live or what family they were born into. Not everybody has the same chance.

In our province we believe deeply in the concept of equal opportunity. The job of government is to ensure that everyone has an opportunity to start at the same starting line. That is where government has to be. However, if government does not have the fiscal capacity to do that because too much of what it spends services the debt it cannot do it.

We have dealt with the very onerous fiscal problem we inherited from the former government. We have done it in a way that has attracted international attention, although it has not satisfied my friends across the way. That should not surprise anyone.

I have debated with colleagues across the way from time to time in committee and in other places. I remember, going back to 1995, talking about the nature of some of the reductions the government undertook to deal with the deficit. We have had that discussion. We have heard a lot about it lately as members have come forward with proposals with regard to social spending.

When given the opportunity to comment on the 1995 budget, members across the way and the Progressive Conservatives did not say that we cut too much. They did not say that it was wrong to cut transfers to the provinces. What they said was that we did not cut enough.

Mr. Ian McClelland (Edmonton Southwest, Ref.): Madam Speaker, the member opposite from Fredericton and I have served on committees together. Particularly we served on the committee for human rights and persons with disabilities. That committee worked in a non-partisan way on many worthwhile subjects, one of which addressed the very real concerns of persons with disabilities.

Persons with disabilities could be put into two separate groups. Although some persons with disabilities do not want to be put into two distinct groups, the fact remains that there are two groups. There are those Canadians who through accident, through birth or through other circumstances find themselves in absolute need of society's help on a daily basis to have, as the member opposite mentioned, the potential of equality of opportunity. There are those who have become disabled over the course of their lives and whose disabilities are very real but have come about as the result of aging or living. That is the distinction between the two disabilities.

When the Canada health and social transfer was first instituted persons with disabilities fell through the cracks. Most people acknowledge that happened.

Has the government considered a specific program whereby persons disabled for life will be held harmless from the cost of their disability both through proactive financial support and through the removal of the catch 22 where disabled people, who make the extra valiant effort to be gainfully employed, find that they lose the very benefits allowed them to get employment in the first place? Has that been and will that be addressed?

(1045)

Mr. Scott (Fredericton-York-Sunbury): Madam Speaker, I thank the member from Edmonton for his question. He is well informed in this debate.

The task force concluded two specific recommendations. The first is that the role of the federal government should be to mitigate the cost of disability.

If we cannot make a disability go away, surely as an enlightened society one of our objectives would be that they do not have, in addition to the real obstacle that is presented by a disability, the other costs that go with that disability, such as the cost of the wheelchair, the cost of adapted transportation and so on.

Specifically, the medical services expense credit has been expanded to accommodate that. There is a list of items. There is the cost of an air conditioner if the person has conditions that require them to have air conditioning. It was dealt with.

The second thing has to do with the catch-22 that the member referred to. Many Canadians with disabilities want to go to work but cannot because they recognize that the moment they go to work they lose access to a variety of programs, usually provincial, that they need by virtue of that disability.

I refer to the changes in the limitations on the medical service and the disability tax credits that allow an increase in what might be covered under those credits.

That in itself will go a long way not only in terms of allowing people who are currently unemployed to go to work but also to take away the need for many people who are working to stop working so that they can access these programs.

It is a very real question put. It is a good question. The reality is that the budget spoke to it.

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[Translation]

Mr. Osvaldo Nunez (Bourassa, BQ): Madam Speaker, I rise today to speak to the fourth budget tabled in this House by the finance minister, on February 18.

It is an election-minded budget because most of the cuts had already been announced in the three previous budgets. Once again, the main victims of that budget are the provinces, the middle class, the unemployed and the poor. The greatest tragedy, the biggest scandal in Canada, the major failure of this government is the unemployment rate.

However, this budget does nothing in the area of job creation. The Liberals rely solely on market forces and on the private sector for job creation. Up until now, that strategy has been a total failure. Yet, during the 1993 election campaign, the Liberals did promise they would create jobs, jobs, jobs, as their famous slogan said.

They did not meet that commitment, which was a determining factor in their victory. The Liberals have consistently reduced the access to and duration of UI benefits. Let me remind you that, when the Liberals came into office in 1993, only 33 per cent or a third of the unemployed did not receive benefits. Today, the figure is 55 per cent. It is appalling.

To these restrictions, we must add the carelessness of the government and its failure to act when faced with multiple business shutdowns. On that point, I would like to draw your attention to one human tragedy that occurred in Montréal-Nord, in my riding of Bourassa; at the end of February, the Zellers distribution centre announced that it would close on July 1. Because of that closure, 379 men and women will lose their jobs in my riding, which is already hard hit by unemployment and poverty.

I have asked the federal ministers of industry and labour and the President of the Treasury Board, who is responsible for Quebec, to take the necessary measures to prevent that distribution centre from closing so that these workers may keep their jobs and their dignity.

(1050)

I hope that the federal government will act in good faith and co-operate on this issue. I hope also that the results of its action will demonstrate that it is truly trying to create jobs. Up to now, I have not had any response from the government on this.

Since 1993, I have been the official opposition critic for Citizenship and Immigration. Therefore, I would like to make a few comments on that department. The budgetary needs for 1997-98 have been set at $575 million, that is to say $40 million less than the previous year. The budget was reduced 6.5 per cent over last year, and the staff 20 per cent.

Since the Liberals came back to power, the government has imposed unprecedented cuts on the department. Several centres in Quebec and elsewhere were closed, and thousands of employees were let go, at a time where extra efforts are needed to integrate newcomers.

Yet, with the creation of an immigration tax of $975 per person, and a $500 fee per application, plus the steep increase in other user fees, revenues have increased tremendously. They will reach$363 million for the current year and cover 63 per cent of expenditures. Previously the revenues amounted only to 54 per cent of expenditures.

Despite budget cuts, the government will spend $3.4 million on the promotion of Canadian citizenship. This money will be used for advertising and propaganda campaigns to promote Canadian unity. If we add the tens of millions of dollars allocated to this same objective by the heritage department, it is clear that the government is making cuts in areas in which it should be investing, while wasting public funds on unnecessary things.

Last November, I went to Taiwan as part as a parliamentary delegation. In Taipei, I met with the diplomats and immigration officers of the Canadian mission. I learned that, just from granting visitor's visas and charging fees to the Taiwanese who come to live in Canada, the government had collected more than $9 million in the last year. It must be pointed out that more than 100,000 Taiwanese tourists came here in 1996. Yet, the mission only costs a third of that amount. At that rate, the citizenship and immigration department will be making profits in a few years, which is neither the role nor the objective of the government with regard to immigration.

I would also like to deal with the issue of child poverty. One child out of five lives in poverty in Canada. Among industrialized nations, this country ranks second after the United States for child poverty. The Liberal government forgets that children are the future of the country. The budget does nothing to create jobs and unemployment means poverty. There are 1.5 million poor children in Canada. That is appalling.

In the face of this disastrous situation, the government is only committed to injecting $600 million, which is clearly not enough. According to the Caledon Institute, there should be at least$2 billion more each year to really deal with poverty.

As in the previous years, this budget has been praised by big business and the financial sector. However, it has been denounced and condemned by the labour movement and anti-poverty organizations.

Buzz Hargrove, president of the Canadian Auto Workers, has this to say: ``This budget is a cynical and political attempt by the federal Liberals to manipulate public opinion before the next election''. He adds: ``We were told that, if we reduced the deficit and focused on business, everything would fall into place. However, the private sector itself has shown that it is unable to generate

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the jobs that Canadians need, and the finance minister's cuts have only made the situation worse''.

(1055)

As for Bob White, the president of the CLC, he condemned the fact that the Liberals have cut $14 billion in social programs since 1994. He said this: ``The only plan this government had with regard to job creation is to put blind and almost reverend trust in the markets to do the job''.

In Quebec, similar criticisms were voiced by FTQ, CSN and CEQ leaders. FTQ president Clément Godbout deplored the lack of job creation initiatives, particularly ones encouraging the reduction of work time and the restructuring of work. He also condemned the cuts made in transfer payments, which hit Quebec real hard.

I condemn this fourth budget of the Liberals because it does not give any hope to the 1.5 million Canadians and Quebecers who are jobless or to the 1.5 million who are employable but have given up looking for a job. It is a scandal to have 10 per cent unemployment in Canada, and more than 20 per cent in my riding of Bourassa. Even Chile, a developing country, has managed to bring unemployment down to 5 per cent, as in the U.S.

It is unacceptable that 17 per cent of our young people do not have jobs, that the wages of millions of workers have been either frozen or cut back, that 5 million Canadians and Quebecers-a 500,000 increase since the Liberals took office-live under the poverty line, that some businesses and some rich people do not pay taxes, that the gap between the rich and the poor keeps growing. That is an immoral and outrageous situation the federal government should deal with.

Mr. Yves Rocheleau (Trois-Rivières, BQ): Madam Speaker, on this third day of debate on the budget, I am pleased to join my colleagues and to speak as the member for Trois-Rivières and critic for regional development.

This government and its Minister of Finance in particular are constantly boasting about their good performance, but, on our side, we never stopped shedding a different light on the facts to remind the public that their fight against the deficit is not really aimed at putting our fiscal house in order, but is done on the backs of the unemployed, the most disadvantaged.

We all know that, thanks to UI contributions paid by employees and employers, the unemployment fund has a huge surplus of some $5 billion that the Minister of Finance is using to reduce the deficit rather than speed up economic development. We this surplus, he could lower UI contributions for employers, and above all for workers, leaving more money in their pockets and thus increasing consumer spending.

No, this would be too wonderful, too generous. The Minister of Finance prefers using other people's money to improve his image just before the election, although this is not in the best interests of the public. He also did it at the expense of the provinces, as everyone knows, by recently cutting $4.5 billion in transfers to the provinces, not to mention, again, the $5 billion taken from the unemployment insurance fund.

So, the government is boasting about an amount of $10 billion when, in fact, it got that money at the expense of others. This is absolutely shameful, and we will make it our duty to inform the public accordingly, including Quebecers, in the months to come.

There was also no tax reform, even though the official opposition, through its members on the finance committee, provided a great deal of advice to the government in recent months. I am referring here to the hon. member for Saint-Hyacinthe-Bagot, the hon. member for La Prairie, and the hon. member for Anjou-Rivière-des-Prairies who, with the help of advisers, did a job that was even noticed by the Minister of Finance, but ignored.

(1100)

The government turned a deaf ear, even though these were very reasonable, not ``revolutionary'' proposals, including a suggestion to make sure the tax deferred by corporations is better managed. The business sector is well aware that some companies are making excessive use of that tax provision. Why not crack down harder on these companies, given what is being asked of the poor?

No effort is being made either to ensure that the distribution of wealth is done more properly, and that those who are financially well-off make a greater contribution. And I do not mean the middle class, because it is all too easy to crack down on wage earners. I mean those who wield some financial clout. I mean those who can take advantage of tax havens, who can use several of them at the same time. These are the people we should be going after.

Of course, I also want to mention those who have family trusts of a very high value. I am not talking about a family trust of $50,000 or $100,000, but about the family trusts the auditor general mentioned last year: $1 billion in each one, and morevoer they were transferred to the United States.

When are these issues ever raised, nowadays? When will the government make the rich pay, the really rich people, not the middle class, which is being strangled and which increasingly is working for nothing, a situation which has a destabilizing effect on the social fabric? We are more and more critical of each other, while forgetting in the process that the money is there somewhere. As far as I know, there is no warehouse facility in Canada, in Quebec or in the world, where money is being burned. Money is not being burned. If wealth is not being shared, then it is being concentrated.

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In Quebec, in Canada, in the western world, we are witnessing an increasing and abusive concentration of wealth. If this trend is not corrected, we have every reason for being concerned about the future.

There is a passage in the speech from the throne that particularly caught my attention; it is the second paragraph on page 12, and it is of special concern to the residents of the municipalities in my riding and of many communities, especially in Quebec. Some of my colleagues will no doubt feel concerned.

The paragraph reads as follows: ``Therefore, we are announcing today that $10 million of funding in each of the next three years will be devoted to significantly increase the number of communities across Canada that have the electronic infrastructure required to access the communications technologies of the future. As a result of this program, virtually every community in Canada between 400 and 50,000 in population will be connected over the next four years-5,000 communities in all.''

That is all very nice, but you have to know how much this is out of touch with reality as far as daily communications by telephone are concerned. You have to know that in my riding, in the new part of my riding adjacent to Louiseville, Saint-Léon-le-Grand and Maskinongé, as in many other small communities of Quebec-I got to understand that these last weeks-we have telephone service that cannot be called anything but rotten.

We are still living in the stone age as far as communications are concerned. In the Saint-Léon-le-Grand area and in some communities in the riding of Saint-Maurice, the Prime Minister's riding, four subscribers still share a single line. Four people on the same line, and we keep talking about the electronic infrastructure across Canada. We have satellites and we still cannot even have fax machines at home. This is a far cry from the optic fibre era. We have four people on the same line. Some businesses are also on a party line of four. They cannot get personal calls because there is no confidentiality whatsoever.

Apparently, there are senior citizens homes with 10, 20, or 30 people using a single party line shared by four customers. There is no confidentiality, and it is impossible to make emergency phone calls. These people need to be able to call the police or the ambulance. This is not in the far north, but in an area between Montreal and Quebec City, right in the middle of the province.

I hear more and more that even in the Montreal area, this kind of problem occurs, just like in smaller towns. It is about time the government called the CRTC to order, and that the CRTC called to order big companies like Bell Canada, to make sure the public in Canada and Quebec gets some respect, to make sure taxpayers and subscribers get the kind of respect they deserve.

(1105)

There is something weird here. We keep talking about the optic fibre networks, of globalization of markets, free trade and high technology-and technology kills jobs-and we cannot even make a simple phone call in decent conditions. This is unacceptable. We at least need the means to spread the bad news. In an area between Montreal and Quebec City, we still have party lines of four. It makes no sense whatsoever. These people sometimes need to call the ambulance. I would like to pay tribute here to the head of the Maskinongé RCM, Jocelyne Elliott Leblanc, the mayor of Louiseville, who has done a remarkable job.

The issue has been brought to the attention of the Office of the Prime Minister, the hon. member for Saint-Maurice. He better deal with the problems faced by the residents of these new municipalities still living in the Stone Age, because his government sanctions the CRTC, which establishes standards fit for large corporations, including Bell Canada, and where navel-gazing is a favourite pastime, except for those who do not have access to adequate phone services.

The Prime Minister has better take care of this. The ball is in his court and we will be waiting for him just around the corner in a few weeks or a few months because, if he is unable to deal with such issues-he was unable to settle other similar issues, as we know-the people of Saint-Paulin and others in that region who are faced with such enormous problems will let him know.

In some cases, Bell Canada's solution was to suggest that people buy cellular phones. There are no phone services in that area, and I am not talking about the far north, as I said, but about a region located between Montreal and Quebec City, one hour from Montreal and one hour and a quarter or one hour and a half from Quebec City.

It does not make sense; it is unacceptable. The government is bragging, something the Minister of Finance is quite good at. They are bragging about the information highway. But we will talk about that again during the election campaign.

[English]

Mr. Larry McCormick (Hastings-Frontenac-Lennox and Addington, Lib.): Madam Speaker, I have a question for my colleague who has just delivered a very passionate speech. At the end of his speech he talked about communications. Certainly nothing is more important than communications. He talked about communications between Montreal and Quebec. He talked about telephone lines. In my riding of Hastings-Frontenac-Lennox and Addington, which encircles Kingston, we had those challenges. We have locations where telephones are barely available.

Would my colleague not consider that if his provincial government and his party, which I understand still has the status of the

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opposition, the loyal, royal blue roots opposition here today, were to work together with us, we could make greater progress?

I have many friends and colleagues in Quebec. They want the same thing for their families that people want in my riding. They want to ensure the future, the health and the concern for jobs. It is time we speak for what we believe in and that we work together. This is reflected in value of real estate today. It is shameful what has happened in Quebec City to the very fine wonderful people there, what has happened to the value of real estate since the first day of 1997.

It is time to start to concentrate on working together instead of putting up this smokescreen to appease a few people who have a lot of money. I ask the member to represent all of his constituents.

[Translation]

Mr. Rocheleau: Madam Speaker, I want to thank my colleague for his question. I think that the main characteristic of the official opposition since we were elected to the House in 1993, the first session starting in 1994, is indeed a spirit of co-operation, which was reflected in documents published during the October 1995 referendum, in which we spoke of partnership.

(1110)

What we sovereignists ask for is mutual respect. This is something we as the official opposition can achieve here.

I spoke earlier of the work done by my colleague from Saint-Hyacinthe-Bagot, who is our finance critic. It must be a rare occurrence in Canadian history when the opposition proposes very articulate and well-documented suggestions on corporate and personal income tax. We suggested ways for the government to improve the tax system. This is a good example of partnership and respect.

We are not here to destroy any country but to build one: Quebec. It is our country, our homeland, and we want to work in a respectful partnership, on an equal footing with our closest neighbour, with whom we have an indisputable historic relationship.

We are a people, just as Canadians are a people. So why not work together in an honourable and civilized way? Both our societies are civilized. So why are there such antagonistic feelings, especially in the Canadian press? Why not recognize that Quebec is profoundly distinct? Why not be pleased that this people will soon become sovereign? We would work together, not one against the other. Quebec's current economic problems should not be a cause for celebration.

Montreal is going through a very difficult period. Let us hope that this is not the result of a concerted effort. Let us hope that this will not lead some people to pat themselves on the back. The worse the situation is in Quebec, the more people will be scared and thus tempted to vote no; let us hope this is not a strategy. Let us hope that this is only a coincidence and that the Canadian government will put Quebec's money back into Quebec's economy, especially for R and D and the purchase of goods and services. We know that Quebec has historically been treated like an underdog by the Canadian government. Let us hope that the situation will get back to normal as soon as possible and that we will be able to work closely together as two peoples and two civilized nations.

[English]

Mr. George Proud (Parliamentary Secretary to Minister of Labour, Lib.): Madam Speaker, I will be sharing my time with the hon. distinguished member for Burin-St. George's.

It is a distinct pleasure for me to participate in this debate with regard to this budget. I would like to congratulate the government, the Minister of Finance and of course the whole Liberal caucus. I want to single out the Parliamentary Secretary to the Minister of Finance, the hon. member for St. Paul's, who is my seatmate. He has done a tremendous amount of work in the preparation of this budget and of course lining up the debate which is going on the House right now. I congratulate him. I am sorry that he has decided not to run in the next election and I wish him well as he goes down the road and continues his work as a great Canadian.

Our teamwork has resulted in a budget that will benefit not only the people of my riding of Hillsborough but all Canadians. Since the minister made his speech we have heard a lot of commentary. Some special interest groups say it is not enough, other groups say that it is too much but, more important, we have heard from a few Canadians who, I believe, represent most of the people who say it is just right.

I am one of those people. I am one of the many in this House and I am one of the millions of Canadians across the country who agree that the government as a whole has done the right thing. I agree with the budget approach, the extent of the measures and I agree with the timing of these measures. I would like to elaborate by explaining why my opinions are so positive toward this budget.

When we entered office in the fall of 1993 the federal government was deep in debt and it was falling ever deeper very rapidly. After just four budgets we can now see the light at the end of the tunnel. The deficit has been reduced by over half, a reduction of $23 billion, and if we look at the cumulative effect of those cuts we have lowered the net debt by $89 billion from what it otherwise would have been. For this we and all Canadians have been rewarded by the financial markets with lower interest rates.

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We have heard many calls for cuts to payroll taxes, income taxes, sales taxes and every other tax that has been the flavour of the day. I would like to provide my hon. colleagues in the House examples of what our actions have meant to Canadians.

(1115 )

First, let us assume that you, Madam Speaker, have a $100,000 mortgage which is to be amortized over 25 years. If we compare the rates that were available in January 1995 and the rates available right now, by refinancing you could save roughly $230 a month on a five-year mortgage. Instead, if you took a one-year mortgage you could save over $300 a month. That is a lot of money.

But there is more. Let us assume that a small business person started a business and took out a $1 million loan amortized over 10 years. If we compare the interest rates that were available in April 1995 with the interests rates that are available now, by refinancing that loan, that person could save $33,000 annually.

If I went out tomorrow to buy a car and I borrowed $15,000 and amortized it over four years I would save $480 a year because of the lower interest rates.

These examples are not fiction. These are examples in the real lives of real Canadians. I have people in my riding, as I am sure in other ridings as well, who will save thousands of dollars because of our actions which have resulted in these lower interest rates.

To make my point even clearer, perhaps we should compare a cut in payroll deductions with one of the examples I have just given. What would happen if a payroll deduction was cut 25 cents per $100 in earnings? We have heard calls for this in the House and across the country. The Canadian who makes $39,000 a year would save, now hold on to your hats, a whopping $97.50 per year, not per month but per year. What is more, this meagre cut would cost the government $1.8 billion. Lower interest rates save money, not cost the government money.

Given the choice of a payroll deduction cut of $100 a year or interest savings of $480 on a consumer loan or $2,000 to $3,000 on a mortgage, what would members choose? I know what I would choose and let me tell the House it would be worth more than $100.

I would like to put the budget into perspective. The deficit is still falling. We are doing well on that front, so well in fact that the government was able to invest in health care as recommended by the National Forum on Health. It was able to invest in education by assisting students and their parents. It was able to relieve some of the burden on low income Canadians, and it was able to provide assistance to Canadians with disabilities as suggested by the federal task force on disability issues.

All this goes hand in hand with recent announcements and other budget items such as the funding for the extension to the community action plan for children and the Canadian prenatal nutrition plan. I applaud these extensions. I and my constituents are happy to see these important programs being maintained.

The government chose the right path. It chose a balanced approach by staying the course while providing some relief to Canadians. It has been a hard fight for everybody, but we must continue to reduce the deficit if we are ever going to be able to achieve our goals.

One of our primary goals is job creation. A lot of attention has been given to small business. Yet again, there are initiatives in the budget that benefit small business.

The Canadian Tourism Commission is a partnership of both the private and public sectors which designs and implements effective marketing strategies and programs to increase tourism revenues in Canada. The commission also provides services to the tourism industry to help it remain internationally competitive.

Tourism is a large part of the local economy in my riding, indeed in my province. The increase in funding to the CTC will boost the promotion abroad of Canada and thus boost our tourist industry on Prince Edward Island. This is particularly important to us now that the Confederation Bridge is opening in just a couple of months. Islanders are expecting a million tourists this year. This is a jump of some 200,000 tourists over last year, the largest factor for the increase of course is the bridge. This is twofold.

First the bridge will alleviate many of the travel problems associated with the ferry service. Second, the bridge is more than just mode of transportation. The bridge itself will be a tourist attraction because Confederation Bridge is the largest of its kind. When it was built a special crane had to be brought in, a 9,000 ton crane, to install the 8,200 ton girders. In fact, tours were given throughout construction just to see this operation.

(1120)

Another boost to the tourism industry is the additional funding to the Business Development Bank of Canada. The $50 million will translate into $250 million in loans to small business and tourism. This means more opportunities for Islanders and for all Canadians. This increase in tourism will not only enhance the peak summer season in Prince Edward Island and Atlantic Canada, but it will also strengthen the shoulder season periods of spring and fall.

This will mean jobs. More help will be needed during the peak season and the shoulder seasons and that will mean more hours. In short, more people will stay on the job longer.

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Boosting the tourism industry is good but what Islanders also need are full time, year round jobs. To assist in that area, the government is investing upfront $800 million in the new Canada Foundation for Innovation. This foundation will help strengthen the research and development infrastructure at universities, colleges, research hospitals and not for profit research institutions and organizations in the area of health, environment, science and engineering.

I have both a university and a college in my riding. These two institutions are eligible for financial support from the foundation to modernize their research infrastructure. The foundation will be an arm's length organization. It will seek partnerships to support these investments. Together with their partners, it will be able to fund up to $2 billion in infrastructure improvements.

I am sure that all hon. members are interested to hear what the president of the University of Prince Edward Island had to say about the foundation. Dr. Elizabeth Epperly said: ``It sounds wonderful and you can be certain that we will take advantage of it''. Those are words of encouragement from a key player in the field.

In fact, innovation is becoming increasingly important for international competitiveness and that is even more important in an open country like Canada. In light of this, the government continues to make every effort to improve competitiveness.

I am pleased with the budget. I know Canadians are pleased with it. It shows that the hard work that we have done over the last three years is paying off. I encourage all people in this House to support it.

Mr. Ted White (North Vancouver, Ref.): Madam Speaker, I listened with quite a lot of interest to the member's speech. At the very end of his speech he said that Canadians support the budget.

I would just like to ask him a question based on a letter that I have received from one of my constituents dated February 11 with respect to the budget. My constituent says: ``Last October I was lucky enough to receive a $300 per month raise in pay. My wife and I consider ourselves fortunate and looked forward to being able to remodel our kitchen in the new year. When my end of January pay arrived, there did not seem to be any extra money available. Closer examination reveals that from my original $300 raise, $162.60 went to increased income tax and $129.96 went to increased CPP and UI deductions which left $7.44 on my cheque''. When that was combined with some additional increases in natural gas and so on, he calculates that he is actually $14.56 worse off in January 1997 than he was in January 1996.

At the end of the letter he says: ``I do hope that you have enjoyed using the extra $1,951.20 of income tax that my raise produced in your budget this year''.

I would like to ask the member whether he thinks it is productive that the tax creep that has been encouraged by the government's actions has actually created a situation where people are worse off a year later than they were in 1996. Why is he so proud of his budget when all it has produced is more hardship for Canadians?

Mr. Proud: Madam Speaker, I thank my hon. colleague from North Vancouver for his question.

Obviously the individual he is talking about is in a very high tax bracket. As I said throughout my speech, as a result of this budget people are better off today than they were four years ago. I say that without any fear of contradiction. We have lowered the payments to unemployment insurance. We have done all these things. We have lowered interest rates. People have more money after they pay on their mortgages and their loans. Things are much better.

(1125 )

The government could give an across the board tax cut, but this is not the time to do it. The government does not think it is the time to do it. However, eventually the time will come. If we give an across the board tax decrease right now, then the deficit would go up. We cannot afford to do that. We have to get our financial House in order. When that day comes we will certainly have even a better budget than we have today.

[Translation]

Mr. Osvaldo Nunez (Bourassa, BQ): Madam Speaker, my colleague is pleased with the budget and the success in the battle against the deficit. However, he does not say a word about child poverty, a serious issue in Canada and Quebec nowadays.

There are 1.5 million children who live in poverty in this country, and the government has no real intention of solving this problem. The government has set targets in its battle against the deficit and it has met them, but it has not set any objectives in dealing with the very serious problem of child poverty.

I would like the member to explain to us why the government is investing only $600 million in the fight against child poverty, while various anti-poverty organizations tell us that it must immediately invest at least $2 billion in concrete measures in order to address this problem.

[English]

Mr. Proud: Madam Speaker, I thank the hon. member for Bourassa for his question. No doubt it could be said that nothing is ever enough.

We put $600 million in the budget to fight child poverty. Probably it is not enough but it is all we could do this time. A lot of poor children belong to families where there are single parents. This is a terrible tragedy of our society. We have to make things better for these people.

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If the hon. member goes through the budget and sees the programs in it, the money that has been put in there, probably it is not enough. However, it is a lot better than it was last year.

Hon. Roger Simmons (Burin-St. George's, Lib.): Madam Speaker, I too want to rise and voice my support for the measures in the budget brought down just over a month ago. The would-be minister from Calgary Centre draws attention to his presence here.

I say to my good friend from Calgary Centre, I have a lot of choice on this one. It is my choice to support this budget. If he will give me a chance, being the gentle man that he is, I will tell the House in the few minutes I have some reasons why I support the budget.

The first was alluded to by my good friend from Bourassa just a moment ago, the issue of child poverty. As my friend from Hillsborough said, not enough is being done. However, we are making some progress. Some money has been put into this important initiative. I happen to believe, as a Canadian and as a Newfoundlander, that it is an absolute disgrace that so many people are living in poverty in this, the best country in the world.

Obviously, we have done some things very wrong over the past few years so that we should have that situation still applying. We have to address that one. It has to be a priority for Canadians of all political stripes because poverty, which you rather take for granted in third world countries, is right under our noses. People have to ask why we cannot do more to alleviate that situation, to get rid of it sooner rather than later.

I salute the Minister of Finance because he has made some progress in this area through the child tax credit. It is a step in the right direction in addressing the problem of child poverty.

The budget this year, which proposes to increase spending on children, will increase from $5.1 billion to $6 billion by July 1998. That is some progress but dollars do not say it all. The reward will be in the benefit that these dollars achieve over time. Also in the budget there is new emphasis on young people not only in terms of increased funding for summer jobs but in terms of addressing some of the problems they face with funding for university. We have an improved system of student loans and education credits to ensure fuller access to a good education by all young Canadians from coast to coast.

(1130 )

I like the emphasis in the budget on the assistance for disabled people, including broadened tax relief for medical expenses. It is something that I have been fighting for for a long time, I and many others in this House, and I am glad to see that the government is moving in that direction.

I was also pleased with the emphasis on health care in this budget and the new initiatives that the government proposes to take, in particular in the area of nutrition for example.

If we reflect on the time we have been here since November 1993, three and a half years, things in financial terms, in fiscal terms were quite different and a lot bleaker at that time than they are right now. This government, through the leadership of the Prime Minister and the Minister of Finance, has restored some sanity to the public finance system. We all know the statistics on how we have brought down the deficit by so much over such a short period of time. I will not bore members with those stats again.

Let us always keep in mind that government finally is not about managing money, as important as that is. That is the means to the end. If we do not manage our money right, we cannot do these things in terms of social programs and job creation that we are dedicated and committed to doing. We have to keep our eye on the ball. While managing money is an important step it is not the end in itself. It is just the means to the end. The end itself has to be, must be at all times, people. We have to see that people are better served.

People who are unemployed are not very well served. It is difficult to appreciate the importance of deficit reduction or many other things that are touted in this budget if one does not have a job. In my own riding, in my own province the unemployment rates is still unacceptably high. I salute the job creation initiatives in this budget. I believe we are generally going about it in the right way because I am a free enterpriser. I believe that government does not create jobs. It is the private enterprise sector that creates the jobs and small business that creates jobs. There are measures in this budget including lowering employment insurance premiums which make it more attractive for small business to create jobs.

We have had to be patient. It is hard to be patient if one does not have a pay cheque to put the groceries on the table. I believe that the effect of the kind of budgetary measures that we have had over the last three or four years, together with the one right now before us, the cumulative effect of that will be to increase more jobs out there.

Already the record of this government is that it has increased 700,000 jobs. The projection is that we will see another 300,000 or so in this year.

We are beginning to see the light at the end of the tunnel. I have great concerns for those people who do not have jobs. We have to see that more is done by government in terms of leadership, in terms of the incentives we provide to bring down the unemploy-

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ment rate. In my own situation in Burin-St. Georges and in Newfoundland generally, we have over the past three or four years been devastated by a terrible downturn in the fishery.

There too we are beginning to see a bit of light at the end of the tunnel. I do not want to anticipate my friend, the minister of fisheries, but I am hoping that he will accept the recommendations of his advisory council and reopen the fishery at least in a limited way on the south coast, 3PS, 3PN, 4S and so on, that area that recommendations apply to. I hope we will see a reopened fishery.

Those people who are on TAGS, those people who are on government assistance, are not there because they want to be there. They would rather be working. Speaking of those people, we are still leading the charge on the issue of labour force attachment.

These people through no fault of their own were prevented from working by a government initiated endeavour. They were barred from working. The government mandated that shutdown. Through no fault of their own they now find themselves being treated as new entrants. That is unconscionable. It has to change. These people were not told upfront that might happen to them. Indeed it was not going to happen to them. If we had been able to stick with the original objectives in that program, where all would be trained, that would not have happened. That circumstance of no labour force attachment would not have applied. It applies today because in midstream, because of increased numbers coming into the program, the government had to change the rules and deprive people who would normally have had some training opportunities because of a limited budget.

(1135 )

For those reasons, that they did not know upfront and that the rules were changed in the middle of the game, these people, in all conscience, have to be given labour force attachment.

I have addressed that issue on every forum I have been able to. I have talked to the Prime Minister and the minister. I have raised it in caucus and I have raised it on the floor of the House on several occasions. We have to continue to punch away at it until we beat some sense into the heads of the people who matter on that issue. It is an important issue. It affects about 15,000 people in Atlantic Canada and Quebec, the five eastern most provinces. We have to do the fair thing when it comes to that issue.

Government is also about fairness. People out there have difficulty identifying with the positive things that may be in a budget or in a government initiative if they see something like the TAGS issue which has become a symbol of basic unfairness.

There is no good reason for it, certainly not a monetary reason. What we are talking about would cost $30 million to $60 million over time. That is not a lot of money in the greater government context. It is money which would be well spent.

Let me recap my remarks, as my time has expired. I support with a heart and a half this budget. I invite my friend from Calgary Centre to do likewise.

[Translation]

Mr. Richard Bélisle (La Prairie, BQ): Madam Speaker, I listened to the speech by the member across the way, and I would like to ask him two questions.

Does the member agree that the finance minister is giving himself room to manoeuvre by hiding up his sleeve, according to Bloc Quebecois estimates, $8 billion this year and $14 billion next year?

Would the member agree that these sums of $8 billion and $14 billion should be used to restore the levels of transfer payments to the provinces? And this is particularly important since the member comes from a maritime province which greatly needs its transfer payments, which were cut by the finance minister. Moreover, instead of keeping these large amounts as a reserve, the minister could reinject them into the economy in order to help unemployment insurance claimants recover their former benefits.

Is the member ready to support the Bloc Quebecois in its efforts to have the reserves hidden by the minister used to restore transfer payments that have been cut from the provinces, and the money taken from the unemployed, since it is their money after all?

[English]

Mr. Simmons: Madam Speaker, I thank my friend from La Prairie for his question. However, I must have missed the preamble to his question because I did not fully understand what the conspiracy was. He said that the Minister of Finance is hiding some $8 billion. Could he be a little more specific. I will attempt a response.

[Translation]

Mr. Bélisle: Madam Speaker, I will rephrase my question. According to the calculations made by the Bloc Quebecois, the minister could have lowered the deficit a lot more this year. It is said to be around $17 billion, but according to the latest trends, the real figure, which will be known in the next few weeks, could very well be around $10 or $12 billion. In the next few years, probably by 1999 or by 2000 at the latest, the Canadian deficit will have been eliminated.

The Bloc Quebecois calculated that, by announcing a $17 billion deficit for this year, the Minister of Finance has kept $8 billion up his sleeve for this year and probably $14 billion for next year.

(1140 )

Could all the billions the minister is keeping in his pocket be given back to the unemployed who have been robbed by the

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government's employment insurance scheme? Instead of hiding all those billions to bring the deficit down to zero as fast as possible, would it not be better for the government to give back the$4.5 billion cut in transfer payments to the provinces?

[English]

Mr. Simmons: Madam Speaker, one of the things we whisper on our side is that the Minister of Finance is really a closet conservative. Certainly on fiscal matters it is well known that he is a conservative. If we look at his record of budget making over the last three or four years, we will notice that on the matter of projections about employment levels, deficit levels and so on, he has always been a bit cautious.

What my friend from La Prairie characterizes as hiding I would put in another context altogether. I would submit that the Minister of Finance is being true to form here in that while he has projected a deficit of $17 billion, I am sure, as the member suggests, that the Minister of Finance is hopeful it will come in below $17 billion. I would not subscribe to the suggestion that somehow he has been duplicitous and is somehow hiding a lot of money. He is just being himself and is being a bit conservative.

Let us hope the member for La Prairie is right that the deficit is even lower than the $17 billion projected so conservatively by my friend.

Mr. Ed Harper (Simcoe Centre, Ref.): Madam Speaker, I will be sharing my time with the member for Fraser Valley East.

It is with some disappointment that I get up today to speak on this fourth Liberal budget. It is a good time to reflect on the fact that it is the fourth budget. In my view it is the second really do nothing budget of the four. I say that because the first budget introduced by the finance minister was a stand pat, do nothing budget. It was not until his second budget that the government acknowledged the seriousness of this country's deficit and debt. He did start to make some moves to deal with that serious problem. But in the second and third budgets he did too little. It was too little, too late. Of course, this fourth budget is an election budget. It is stand pat, status quo which has serious consequences on the country as a whole.

This fourth budget gives absolutely no hope to those who are unemployed. Despite the election promise of jobs, jobs, jobs, the same number of Canadians are now looking for work as when the government was elected. There are about 1.4 million Canadians who are still looking for jobs. There are about two million to three million underemployed Canadians. About one in four Canadians is employed but is worried about their ability to hold on to their job. There is tragedy among our young people with a youth unemployment rate of 16 per cent. This is an extremely serious issue which the government has failed to address in its budget. We have had 76 months of straight unemployment in excess of 9 per cent. That is the worst record since the depression.

There was no hope in this budget for the crushing tax burden that is faced by all Canadians, be they consumers or part of the business community. It is unbelievable that after four budgets we still have no commitment to a balanced budget. The finance minister says that we are heading in that direction but there is no firm commitment, no timeframe, no date set to indicate when we will have the books in balance.

(1145)

The budget says to a lot of Canadians that they are reluctant to slay the monster they created. They want to keep that avenue open. There are those in government who are saying the era of cuts is over and they can now start spending again when we are approaching $620 billion of debt.

In the budget tax revenues will be up $4 billion. They will be $24 billion higher than when the government took office in 1993. When the finance minister talks about his war on the deficit and we take a look at how he has achieved the reductions in the deficit, 71 per cent of those reductions have been accomplished through increased revenues and only 29 per cent have been achieved by expenditure reductions. There is much more that could be done and much more that should be done.

Those expenditure reductions have been mainly reductions to the provinces in transfer payments. There has been $7 billion in cuts to health care and education in our social programs by a government that gets up day after day and talks about being the defenders of health care.

Since the government was elected in 1993 it has introduced 35 tax increases. Just before the budget was presented the 36th increase was introduced. It is indeed a killer. It is a $10 billion tax grab under the increases in the CPP.

The finance minister argues that it is not payroll tax, that it is an investment. However when it is compulsory out of payroll, from the taxpayers' pockets to the government's pocket, that is a tax. When the government sets the rate that is a tax. I would like to see anyone in government defend what the finance minister is saying to young Canadians, that this is an investment. Young Canadians are struggling to make ends meet. They are not looking for an investment. They are looking for some tax relief so they can keep their heads above the water and pay the debts that are mounting.

Earlier finance minister acknowledged that payroll taxes were a cancer on job creation. Apparently he has changed his mind on that, but members on this side have not changed their minds. Payroll taxes are a cancer on job creation. As a matter of fact the finance department issued a report recently on the number of jobs that were lost on the modest increases in CPP between 1986 and 1993. About half of what is being proposed this time cost Canadians 26,000

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jobs. This will create a loss of jobs but the government has yet to acknowledge how many.

The debt will be about $620 billion by the end of 1997-98. That is our collective shame and our challenge. The government says we are acknowledged as the number one country by the United Nations. We are the number one country in the world. I will not dispute that but I will take exception to the fact that we have more mortgaged our children's future to achieve that number one status. We have not paid our way. That should be our shame.

Since the government was elected it added $111 billion to the debt. The finance minister has gone on about reducing the deficit from 5 per cent to 4 per cent and 3 per cent of GDP. He has not mentioned the fact that we have seen the debt go from $500 billion to over $600 billion. The additional $111 billion the Liberals have added represents about $8 billion in additional interest servicing costs, approaching a total federal interest bill of $49 billion or35 per cent of revenue. That is more than the government is spending on pensions, employment insurance, health education and social programs.

When dealing with those kinds of numbers a 1 per cent increase in interest rates could add potentially $4 billion to our debt servicing costs. Yet I hear the government cheer the fact that the finance minister is talking about only overspending by no greater than $19 billion. I find that no cause for cheering. We are still living beyond our means. Our debt to GDP ratio is the second highest in the G-7.

(1150 )

European countries that want to join in the common currency must be below the 60 per cent target of debt to GDP. Ours is currently much higher than that at about 74 per cent.

What is lacking in the budget and in government's thinking is vision. There is no plan. I read in the paper the Prime Minister has now realized how important vision is. It is encouraging that he is to start getting a vision for the country. There has to be a better way than 76 months of straight unemployment over 9 per cent.

All we have heard from the government-and we heard it today and we will continue to hear it-is that its only jobs strategy is lower interest rates. This will create employment. Lower interest rates are something the government does not have full control over. They are very volatile.

The government encourages borrowing when it should be doing just the opposite. It should be encouraging Canadians to save and to pay their way.

Let us look at the climate for lower interest rates in Canada today. On Saturday the Globe and Mail published an article about record consumer bankruptcies.

I wanted to get into the better way, the Reform way, but I see my time is up.

Mr. Paul Szabo (Mississauga South, Lib.): Madam Speaker, in his statement the member challenged anybody to convince him otherwise that the CPP increases were not a tax or that Canada pension plan premiums were not a tax.

Let me put on the table a couple of facts on the record for the member. He will know that today's pensioners, those people collecting CPP today who have contributed the maximum throughout their careers, are receiving $8 for every $1 for they contributed. That amount tends to indicate that it is not a sustainable situation. When there are five working Canadians for every one retiree it is sustainable, but when the ratio decreases to three to one something has to be done. That is why the changes were made.

As an aside, the member will know that the increases proposed by the government are 9.9 per cent whereas his party is recommending something like 13.5 per cent. If it is a tax in the member's view, why is it that the collection of Canada pension plan premiums does not go into government revenue and therefore reduce the deficit?

When employers pay a little more CPP they have a higher deduction, lower income and thus pay lower corporate tax. The corporations have to pay the additional amount. All other things remaining equal their corporate taxes are going down. In fact the deficit will increase further.

When individuals have to pay additional CPP premiums from their paycheques it reduces the amount of income tax they pay and government revenue goes down further. No matter how we look at it government revenue is going down and the deficit is increasing as a result of the increase in the Canada pension plan.

Does the member not agree that the increase in Canada pension plan premiums increases the deficit of the Government of Canada?

Mr. Harper (Simcoe Centre): Madam Speaker, I thank the member for his question. I do not know from where he got the statement that revenues were going down. When I looked the budget over that escaped me completely. Government revenues have gone up. It is right there and it is indisputable.

Mr. Szabo: CPP does not increase revenues.

Mr. Harper (Simcoe Centre): I know that. It is outside the budget but it is a payroll tax. The member said that it was not a tax. When the government takes out of employees' pockets and it is compulsory, I challenge any member to debate with working Canadians that it is an investment and not a tax. They are not looking for an investment. They are looking for a tax reduction. It

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is a payroll tax. The finance department has said it is a payroll tax. The member's play on words will not fool Canadians. Regardless of how it tries to fudge the issue it is a reduction in the take home pay of Canadians.

(1155 )

The corporations are telling the government to reduce payroll taxes to help them create jobs. The government is talking to the corporations but is not listening to them. They are asking the government to do exactly opposite to what it is doing if it is serious about creating jobs in Canada.

Mr. Dennis J. Mills (Broadview-Greenwood, Lib.): Madam Speaker, I listened carefully to the remarks of the member for Simcoe Centre. The notion of comprehensive tax reform is an area on which the House should be engaged in full debate in a very active way.

I am totally opposed to the member's obsession with deficit and debt. We took a position in the House of Commons four years ago that we would get the fiscal framework of the country in order and that if we did so private sector industry would pick up the slack. We would create an environment so that all these people could somehow create jobs. The fact of the matter is that industry has not done that. It has not come to the party.

What does the member believe we have to do in the House to get industry active in the game of job creation?

The Acting Speaker (Mrs. Ringuette-Maltais): I will allow about 30 seconds for the hon. member to answer.

Mr. Harper (Simcoe Centre): Madam Speaker, 30 seconds. It will be a short response from a short member.

Mr. White (North Vancouver): I am the short member in this place.

Mr. Harper (Simcoe Centre): Industry is not reacting because industry is looking for the government to get its fiscal house in order. Industry is looking for the government to make a commitment to a balanced budget and the government has not done it.

Mr. Chuck Strahl (Fraser Valley East, Ref.): Madam Speaker, it is a pleasure to speak on the budget somewhat after the fact. The budget has kind of come and gone like the proverbial wind in a barnyard, but it is still with us today in debate. It will be with us in the upcoming election whether it is this spring or next fall.

It is good to talk about budgetary items since budgetary items will affect every department and all Canadians because they are footing the bill for the budgetary priorities of the government.

In the wake of the budget many people are asking why they do not feel so good if this is a feel good budget. Where are the benefits? What will the government do to address that we now have over 9 per cent unemployment for 77 consecutive months? The 1.5 million unemployed that shocked the Liberals when they were in opposition is the same 1.5 million unemployed of today. Many people do not see the benefits.

People are also saying they are not sure the government's priorities on spending are where they should be. When I talk to people they say the government's priorities should be a good health care system and a pension system that is supportable and gives the benefits needed. They see the federal government has cut health care and education funding to the provinces by 39 per cent since it came into power. They see hospitals closing. They do not see a lot of benefit for them.

They also see the government raising CPP premiums by 73 per cent. Private contractors will pay $3,270 per year in CPP contributions if they are their own boss. They must pay their entire working lives almost $3,300 per year all for less than a $9,000 per year pension. This is quite a contrast to the MP pension plan that the government has schemed to maintain. It will pay the equivalent of millions of dollars to some members of Parliament for a relatively few years of work.

There is no plan for tax relief in the budget. That is a shame for individuals who have seen their net income drop by some $3,000 a year since the government took office.

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It is also a shame because private industry does not see why or how it is going to be able to afford to hire more people. Payroll taxes continue to go up. The general taxation level is staying too high and the federal government does not seem to be listening to businesses.

Provincial governments, for example the Alberta government, have asked the federal government to have a look to see what lower tax rates and the lowest tax rates in the country mean the most job creation. It is a direct correlation. Why does the federal government not see that?

All this comes in the context of the Liberals now doing their spinning as much as possible to try to create the impression that the Prime Minister is a man with vision, that he can see into the future, that he is able to see what we need and where we are going.

I do not know whether Canadians believe that. Certainly none of what the federal government has done to date budget-wise was visionary, especially its own red book promises. It is now rather waffling in the area of, do I borrow more money, or do I spend a little more on some programming, should I reduce the deficit, is tax relief a good idea or not?

A little while ago the Prime Minister said that tax relief was un-Canadian. Now we hear the finance minister saying that tax relief would be good some time, he just does not know when.

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The national debt will exceed $600 million next year, some$111 billion more than when the Liberals took office. Deficit reduction is due mainly to higher revenue and not to reduced spending. The deficit remains some $19 billion, which proves that the country does not have a revenue problem. Revenues are up. We seem to have a spending problem but the government will not address that.

Since the Liberals took office, tax revenues have increased$30.4 billion. The Liberal vision seems to be that it is okay that the average taxpayer sends some $10,200 to the federal government each and every year, $3,400 a year to service the debt alone.

If that is the vision, then it is no wonder that so many Canadians are working two jobs, that they are moonlighting, that many of them are working on the underground economy and that people are saying they have to do what it takes because if they play by the rules this government is setting, they cannot even feed their families. That is where lack of vision from the Liberals is hurting the average Canadian family.

There are 7.3 million Canadians earning less than $30,000 a year. The Liberal vision seems to be that that is somehow okay. In other words, the chronic problem of the working poor is somehow okay.

Again I mention that by 1998 the Liberals will have cut health and education payments to the provinces by $7.5 billion while cutting its own spending only that much as well. In other words, a lot of the deficit reduction which it has been able to achieve is on the backs of the provinces with the reduced health and education transfers.

I would like to talk specifically about a budgetary item in my own constituency. The Liberals in the last budget, not this one, closed CFB Chilliwack. Now that we have the access to information documents before us, some of the retiring generals and so on have said that this move was a poor move at the time, that it was not a budgetary move but a political move.

In addition, it has been done without consultation with the local communities. That is in contrast to what it said in its February budget when it stated: ``where warranted, the federal government is prepared to work with community leaders and other levels of government to assist in the development and implementation of community adjustment plans''.

We have tried to do that. We met with Treasury Board in Ottawa on April 17, 1996. We were told that there was no money, no compensation, no second thought and that it was just there to determine the process by which the lands could be disposed of. The lands now, according to the Minister of Transport, may sit idle for as long as seven years, stuck in aboriginal land claims which are benefiting neither the aboriginal people nor the community at large.

There has to be something, I would argue, given the words of the federal government both in opposition and since its members have been in government, to mitigate this problem in our community. A $105 million impact on our community cannot be just shrugged off without consultation and without a plan B, a plan that will help the community to make that adjustment.

(1205 )

I have asked in the past and I am asking again today for the federal government to consider transferring E division headquarters of the RCMP to Chilliwack, to the lands at that site. It would be a good use of that land. I have written a letter again to the minister today asking him to do that. It would inject spending into the local economy.

It would be good for the RCMP. They could come into a federal facility where they would have new buildings. It is a lower cost for the RCMP to be in Chilliwack as opposed to where they are located now. It makes sense economically. It makes sense to the members of the RCMP who could enjoy a lower cost of living in Chilliwack. It would be fair because it allows the federal government to do something, as it promised, to make the adjustment from shutting down CFB Chilliwack lands to another use of those lands. It would also let the process begin about the uncertainty of what is going to happen to our lands.

Since the government has pushed ahead with this, the land at CFB Chilliwack has to be divvied up quickly in a way that will allow both the aboriginal people and the community at large to benefit. If E division headquarters were to come to Chilliwack we could make some use of some of the newer buildings and some of the new facilities.

We could then start the process of rezoning that land where applicable. The aboriginal people could get part of it, the community at large could have access to it, developers and home builders and so on could have access to that land. It would be a good budgetary procedure as well if the government could only do that.

I do not have time to get into all the Reform proposals, things like increasing personal deductions, some of our tax proposals and so on, but I am interested in doing that in questions and answers if anyone would be keen to get into that subject.

Mr. Dennis J. Mills (Broadview-Greenwood, Lib.): Madam Speaker, I would like to speak specifically to that portion of the member's speech which deals with base Chilliwack.

It is an interesting example. We have been listening to Reform members all morning and they keep saying that the government has not cut enough, that the Minister of Finance has not cut enough, and that we must continue to keep focusing on a balanced budget. Yet here we have a concrete example in the member's riding, where

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his community has been a victim of this ideological campaign to eliminate the deficit almost overnight.

I am sympathetic to the closing of that base. There are several other examples across the country where this obsession with the deficit has shut down key government instruments, the government presence that has helped build the country.

I listened to the member say that he went to Treasury Board, the very group that did the cutting. He went back after the cutting was done and said: ``Can you help us get this thing going again?'' He feels that he has been a victim of this deficit thing that is evolving in the House of Commons.

I say to the member respectfully and sincerely, does he not think that this campaign to balance the books virtually overnight should now be halted a bit and we should get back into the business of putting a bit more government intervention into the economy so that we can get our constituents back to work. What would the member say to that?

Mr. Strahl: I thank the hon. member for his question. I know he has expressed to me both personally and in the House his concern about CFB Chilliwack. I appreciate that. He has been one of the few members who has actually publicly worried about what has happened to British Columbia's last land forces base. I thank him for those words.

I have two or three comments that are appropriate here. One is that I had said to the minister if he could show me how he can complete the mandate of the Canadian armed forces, how he is going to save money and if he could lay it out for me, I would be hard pressed to say that it is a lousy idea.

(1210 )

What we have been able to find so far from access to information requests, from comments by Colonel Daigle of the western forces command, whose budget briefing documents say there is no money to be saved by this closure, from General Addy who said that this is a military risk and a poor military decision, from the cost overruns in the transfer of base personnel to CFB Edmonton, now some $200 million over budget, is that there is no money to be saved. If there was money to be saved and we could do the job, we would look at it. However, there is no money to be saved and we cannot do the job. It was a poor decision all around.

If money could be saved and the job could still be done, we would have to take a serious look at it. However, that is not the case. That is why I believe this decision has been politically motivated, which makes it a doubly heinous decision. Money has not been saved and the military now says it cannot fulfil its obligations in British Columbia because it does not have a land forces presence.

On the issue of whether the government should slow down its deficit cutting, I would like to say two or three things. Government still has priorities. The budgetary plan of the Reform Party is to spend $94 billion on federal government programming. That does not include servicing the debt. That is still a substantial chunk of change which we think Canadians want and deserve.

Further discussion, I believe, will not be so much on whether the budget should be balanced. Everyone says that the budget should be balanced, whether it be done in two, three or four years. The question then becomes: at what level of taxation should the budget be balanced?

It could be balanced at $94 billion, which is our proposal. It could be balanced at $109 billion, which is the government's proposal. It could go to $120 billion-

The Acting Speaker (Mrs. Ringuette-Maltais): The hon. member's time has expired.

[Translation]

Hon. Pierre S. Pettigrew (Minister of Human Resources Development, Lib.): Madam Speaker, I am very pleased to rise in this House to discuss the budget that was tabled by the finance minister a month ago today, on February 18.

I will begin my remarks by extending my warmest congratulations to my colleague, the Minister of Finance, for the excellent budget he tabled in the House. Of course, this budget, his fourth, builds on the measures announced in the three previous budgets and on the extraordinary work done by this government over the last few years. The work we have done is so exceptional indeed that, when we came to power in 1993, few Canadians expected us to do so well in managing our country's public finances.

This government has put Canada's public finances on such a sound footing that we can now see the light at the end of the tunnel. For years and years, Canadians had been criticized by foreign markets throughout the world for having lost control over their public finances. We have now regained that control thanks to this finance minister and to the government which has contributed to these efforts.

Now that we have put our public finances on such a sound footing that foreign markets and Canadian economists have regained confidence in us, that interest rates are at their lowest level in thirty years and that inflation is finally under control, what kind of society do we want to build, now that our finances on a sounder footing than any time in the past thirty years?

(1215)

What the Minister of Finance showed us in his budget was a government whose primary focus is giving hope back to Canadians, because the budget, in a fundamental way, puts people first.

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Now that we can finally see the light at the end of the tunnel, we are turning our attention to people.

This is a government that wants to build a stronger society, a society that gives everyone a chance to make a contribution, a society that gives even those who are sometimes the least fortunate a chance to hope again.

I often kid my colleague, the Minister of Finance, telling him that he has been just as wrong in his forecasts over the years as all his predecessors. Obviously, I kid him because, if he has perhaps erred, it has been in the sense that the deficits have been lower than he had announced, whereas previous governments have, for years now, always announced lower deficits than they actually produced.

I, of course, prefer the Minister of Finance's rigorous management and tendency to underestimate our deficits rather than constantly overestimate them. I think this was by far the best way of operating.

Naturally, we are concerned about the continuing high unemployment. We are obviously aware that our increasingly healthy economy has created more jobs in Canada since 1993 than the economies of most industrialized countries, that our performance has far surpassed the average of G-7 countries. In this we must take pride.

It is still not enough. We must do more, and I, for my part, am confident that we are going to achieve much better results with the continuing high performance of our economy. It is important that the growth of the Canadian economy, which rests on a solid foundation thanks to this government, can now lead increasingly to job creation everywhere.

I would now like to draw your attention to the kind of society we are going to build on the solid foundation and the achievements of recent years. We on this side of the House have compassion for the least fortunate members of our society and we must stand united, as a society, and invest in each other's future.

The priority we have set, a priority I would consider national because the Government of Canada arrived at it in discussion with the provincial governments, is the situation of children in low income families. The child tax benefit is one of the first investments we can make. Now that we have some leeway, the Minister of Finance has shown that this government continues to be concerned about the least fortunate members of our society, those who are most vulnerable.

What we have also demonstrated as well is that, by focusing on the children of low income families, we are investing in the future, since everyone is aware that poverty consistently leads to situations that are harmful to society. Poverty is unacceptable in itself, for the people experiencing it, but it is an extremely heavy burden for society as well.

Thus, when we invest in the children of poor families, we are strengthening the social fabric of our society, and therefore are making what might be called an investment in the future, rather than a social expenditure, for poverty can kill every spark of promise there is in an individual. I believe that everyone can see that poor children start off with a strike against them. They have more school problems, and more need of the health care system. Knowing that the poor are always more liable to end up unemployed and dependent on social programs, we must therefore make sure that fewer children start off life on the wrong foot.

(1220)

A child who starts off on the wrong foot has a hard time changing gears and overcoming obstacles later. These children need to be nourished; the same goes for their spirits, their hearts, their souls and their potential. This we have done, in a way that strikes me as eminently responsible.

We wanted to break down what we call the welfare wall. The child tax credit established by this government in conjunction with the provinces across Canada is intended to break down that wall. This is an extensive, nation-wide effort, in which the provinces and the Government of Canada are working together in an area of concern to them both.

What do I mean by the welfare wall? The social assistance trap which holds too many children prisoner. Very often, parents faced with the decision of whether or not to return to work opt for staying on welfare so that their children will continue to benefit from the programs-such as dental care and coverage for certain prescriptions-they are entitled to as welfare recipients.

As a government, we have determined that we must help families get off welfare if they have the chance, without penalizing their children. This is what we are doing by putting $850 million in new funding into the child benefit. This will come into effect on January 1, 1998, perhaps earlier if the program we want to create with the provinces can be ready sooner.

The idea is to reduce the social welfare trap that penalizes parents, or at least their children, if they agree to go back to work. The purpose of the child tax benefit is to provide equal opportunities for children in low income families with one parent working, by allowing provincial governments to use the money freed by the increased federal tax benefit to ensure that these children have access to better, more equitable services. This is the goal of our policy.

From an economic point of view, this policy is fundamentally sound and, from a social point of view, it is an investment in our future. We all know that a child who has a bad start in life will ultimately cost much more to society. This policy seems extremely interesting to me.

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The $850 million that will be allocated as of January 1, 1998 will be added to the $5.1 billion the government is already paying for the child tax benefit. As of January 1, 1998, $6 billion will be paid out to families with children. We see this benefit as a down payment the government hopes to increase in the future as soon as our financial picture improves. The money to help low income families will rise from $3 billion to close to $3.9 billion, an increase of around 30 per cent.

Thus, 1.4 million families, or more than 2.5 million children in Canada, will see an increase in the benefits they receive from the Canadian government. The results are remarkable, because at the same time we have managed to update Canadian federalism by proving that we can work in harmony with the provinces in this country.

Canadians are sick and tired of seeing two levels of government quibbling over jurisdictions. They want us to work together. We must clarify our roles to avoid this constant stepping beyond the limits of our responsibilities and to avoid creating conflict situations. We must clarify our roles, and that is what we have done with the national child benefit.

The Government of Canada will provide income support for families, while the provinces have agreed to redirect money from welfare to programs and services for children living in low income families. It is this kind of partnership that shows how flexible Canadian federalism can be, how Canadian federalism can be a real boon to the priorities we want to establish, including for our children.

(1225)

[English]

It is time that we realize that federalism is not some game, either the government in Ottawa wins and the provinces lose or the other way around, when the provinces win it is Ottawa that loses.

Federalism is a win-win situation when the two levels of government determine that our federation can be more harmonious and less conflicting. This is the great work we are doing at the ministerial council on the social union. Progress has been absolutely remarkable in the last few months.

I would like to thank my provincial colleagues very much for their extraordinary work and contributions they have made to the national child benefit for which all Canadians are already so grateful and pleased because they can see the better society it is going to build.

The second priority of our discussions at the ministerial council on the social union is the issue of Canadians living with disabilities. We have also taken important steps in the budget to help many of the 4 million Canadians, about 15 per cent of citizens in the country, who live with disabilities. It is absolutely important that in this society that we build on the solid foundation we have built over the last few years, after four budgets from the Minister of Finance, which have established the foundation. It is important that the society we build on that foundation will allow every citizen to participate more fully in life in Canadian society.

We know that the 4 million who live with some disability have more obstacles to overcome to participate in society. This is why in our budget we really wanted to respond to several recommendations of the task force headed by my colleague, the member for Fredericton-York-Sunbury. The Scott task force has done wonderful work to really bring our attention and focus on the priorities of Canadians living with disabilities who must be helped by the government to participate more fully in life. This is the kind of society we believe in. It is important that it be reflected in society.

We have therefore renewed the VRDP. The budget has actually set aside $168 million to extend the vocational rehabilitation of disabled persons program for another year. It is a very good program which is helping Canadians with disabilities to get back to work and to contribute and earn a living with dignity, which every human being in the country is entitled to.

In addition to the VRDP this budget provides $70 million in tax assistance to Canadians who are facing significant medical costs. I think it is a very important element which will help them as well.

[Translation]

The budget also provides for investing $30 million in a new opportunities fund which assists the economic integration of persons with disabilities in their community. We will operate in partnership with non-governmental organizations, NGOs.

In fact I welcome the outstanding job done by members of these NGOs who are working together with organizations for Canadians who live with such disabilities. Without these NGOs, they would not have the same quality of life. That is why we are working very closely with these NGOs to help them financially and in the work they do to help persons with disabilities in Canada to enter the labour market satisfactorily, something they want very much.

This budget has also shown how concerned we are about our youth. On February 12, few days before the budget was tabled, I had the honour to announce, on behalf of the Government of Canada, the youth employment strategy.

(1230 )

The youth employment strategy is not just a strategy for youth, but a strategy designed by young people for young people. We consulted them. What did they ask us? They said: ``Sir, could you please help us get better access to the information we need to get a job? Could you tell us about training programs and careers that are

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available to us?'' As you know, there are many in my own department, Human Resources Development Canada.

So we put in a 1-800 line which is perfectly democratic. It gives everyone access to programs and services, even people living in rural areas, because we did not forget the outlying regions in this strategy. With our 1-800 line, democracy has reached those regions as well, through access to programs and services.

[English]

Rural youth are extremely important for us. This is why we were so pleased to be able to connect them through a web site available all over the country with a 1-800 line that everyone can have access to in a very democratic way wherever one lives in the rural regions of this country.

We have been asked by people to get them out of the vicious cycle of no job, no experience, no experience, no job. We have created 110,000 work experiences in order to allow young people to get work experience. It has been clearly demonstrated that people who have such work experience through an internship somewhere get a job within a few months after that.

[Translation]

That is why, once this work experience has been acquired, a young person tends to find a job more easily, I mean a steady job, after his training.

Since the Chair would like me to conclude, I want to say that the work we did in the social union council is particularly useful and constructive, now that our public finances are in good shape, in fact better that they have ever been in Canada for decades. We can now look to the future with far more hope and enthusiasm. We now know that the social safety net we have in Canada will be strengthened in the years to come. There is light at the end of the tunnel. We again have something to look forward to. And we are very pleased to share this prospect with the provinces.

[English]

Mr. Jim Silye (Calgary Centre, Ref.): Mr. Speaker, I would like to congratulate the minister on his speech. It was very enthusiastic. It is obvious that he believes everything is rosy and great and that the items in this budget and all his plans and best wishes are going to create all the wonderful jobs by the expenditure of these moneys that he has outlined so carefully.

However, I would like to remind him that the light he talks about at the end of the tunnel is not a great vision for Canada. The light at the end of the tunnel is the single biggest problem that this government has failed to address, the debt. That debt is going to be over $600 billion. There is no plan by the finance minister or this minister to address how they are going to amortize or mortgage that $600 billion in some reasonable economic way, like a 35 year period, to pay it down.

He brags about the great finance minister who has addressed the deficit. The government is still spending, according to the latest numbers, $19 billion more than it is bringing in. There are some members opposite who would like to start spending more. They think that because the government is ahead of its deficit targets is new found money, a surplus. That is not a surplus.

What I would like to point out is that this minister is complimenting the finance minister and himself for a job half done. I know he will say that nobody is always ever happy and that they want to always get further and better. However, on this job issue, I am getting sick and tired of listening to government try to take credit for creating jobs, to say that their job is to create jobs. Then other members get up, and actually this is a more intelligent response, but it is not the government that creates jobs. It creates the environment and the right conditions and the private sector creates the jobs. But the government has not done its job yet. It has only done half a job. It is still running a deficit.

(1235 )

On the jobs that the government says it has created, I heard this all last week in question period 770,000 new jobs. Then the finance minister claimed that was a net number.

This is the question I would like to ask the minister directly. He should know this because he is in charge of job creation as well. When the Liberals got elected jobs, jobs, jobs was the platform and 1.5 million Canadians were out of work. Their job strategy was infrastructure, a number of these other items that are in the budget and this was going to reduce the unemployment rolls.

Unemployed according to statistics is 1.4 million. If we are talking net numbers it would seem to me, if I do the arithmetic, this government, if it wants to take credit for creating the jobs, created 100,000 new net jobs, not 770,000 new net jobs. Otherwise the unemployment would have been 2.2 million, not 1.5 million.

Somewhere in there the arithmetic is not right. Somewhere in there somebody is spinning a myth that Canadians are getting a bit confused by. I as a member of Parliament do not have this straight. I do not understand how this government can stand up and say it created 770,000 new jobs and it is the private sector that creates the jobs, which is a contradiction right there, and then have an unemployment rate that is only 100,000 lower than what i

CONTENTS

ADJOURNMENT DEBATE

HOUSE OF COMMONS

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Prayers

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ROUTINE PROCEEDINGS

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GOVERNMENT ORDERS