37th Parliament, 1st Session
EDITED HANSARD • NUMBER 069
CONTENTS
Thursday, May 31, 2001
| ROUTINE PROCEEDINGS
|
1005
| GOVERNMENT RESPONSE TO PETITIONS
|
| Mr. Derek Lee |
| COMMITTEES OF THE HOUSE
|
| Official Languages
|
| Mr. Mauril Bélanger |
| Human Resources Development
|
| Mr. Peter Adams |
| Procedure and House Affairs
|
| Mr. Derek Lee |
1010
| INTERPARLIAMENTARY DELEGATIONS
|
| Mr. Louis Plamondon |
| PETITIONS
|
| Trade
|
| Ms. Judy Wasylycia-Leis |
| QUESTIONS ON THE ORDER PAPER
|
| Mr. Derek Lee |
| BUSINESS OF THE HOUSE
|
1015
| GOVERNMENT ORDERS
|
| SUPPLY
|
| Allotted Day—Federal-Provincial Fiscal Arrangements
|
| Mr. Antoine Dubé |
| Motion
|
1020
1025
| Mr. Pierre Paquette |
1030
1035
| Amendment
|
| Mr. Tony Valeri |
1040
1045
1050
1055
| Mr. Yvan Loubier |
1100
1105
| Mr. Scott Reid |
1110
| Mr. Stockwell Day |
1115
1120
| Mr. Rob Anders |
| Mr. Bill Blaikie |
| Mr. Dick Proctor |
1125
| Mr. Scott Reid |
1130
1135
| Mr. Bill Blaikie |
1140
| Mr. Bill Blaikie |
1145
1150
| Mr. Rob Anders |
| Mr. Yvan Loubier |
1155
| Mr. Scott Reid |
1200
| Mr. André Bachand |
1205
1210
| Mr. Yvan Loubier |
| Mr. Scott Brison |
1215
1220
1225
| Mr. Tony Valeri |
| Mr. John Bryden |
1230
| Mr. Yvan Loubier |
1235
1240
1245
1250
| Mr. Antoine Dubé |
1255
| Mr. Gilles-A. Perron |
1300
| Ms. Diane Bourgeois |
| Hon. Jim Peterson |
1305
1310
| Mr. Jason Kenney |
1315
| Mr. Yvan Loubier |
1320
| Ms. Diane Bourgeois |
| Mr. Réal Ménard |
1325
1330
| Mr. Tony Valeri |
1335
| Mr. Richard Marceau |
1340
1345
| Mr. Yvan Loubier |
1350
| Mr. Tony Valeri |
| Mr. Steve Mahoney |
1355
| STATEMENTS BY MEMBERS
|
| FOREURS DE VAL-D'OR
|
| Mr. Guy St-Julien |
1400
| CENSUS RECORDS
|
| Ms. Carol Skelton |
| JEAN-DOMINIC LÉVESQUE-RENÉ
|
| Mr. Bernard Patry |
| CITIZENSHIP AND IMMIGRATION
|
| Mr. Mark Assad |
| WORLD NO TOBACCO DAY
|
| Mr. Yvon Charbonneau |
| HOCKEY
|
| Mr. Kevin Sorenson |
1405
| OXFORD CHILDREN'S GROUNDWATER FESTIVAL
|
| Mr. John Finlay |
| WORLD NO TOBACCO DAY
|
| Mr. Réal Ménard |
| ORDER OF CANADA
|
| Mr. Bob Kilger |
| MEMORIAL CUP
|
| Mr. Bob Mills |
| BILINGUALISM
|
| Ms. Hélène Scherrer |
1410
| LAW OF THE SEA CONVENTION
|
| Mr. Peter Stoffer |
| NATIONAL CANCER SURVIVORS DAY
|
| Mrs. Suzanne Tremblay |
| ORDER OF CANADA
|
| Ms. Nancy Karetak-Lindell |
| NATIONAL DEFENCE
|
| Mr. Gerald Keddy |
1415
| ASSISTANCE TO VICTIMS
|
| Mr. Claude Duplain |
| FRENCH IMMERSION PROGRAMS
|
| Mr. James Moore |
| ORAL QUESTION PERIOD
|
| NATIONAL DEFENCE
|
| Mr. Stockwell Day |
| Hon. Alfonso Gagliano |
| Mr. Stockwell Day |
| Hon. Art Eggleton |
| Mr. Stockwell Day |
1420
| Hon. Alfonso Gagliano |
| Mr. Peter Goldring |
| Hon. Art Eggleton |
| Mr. Peter Goldring |
| Hon. Art Eggleton |
| YOUNG OFFENDERS
|
| Mr. Gilles Duceppe |
| Hon. Anne McLellan |
| Mr. Gilles Duceppe |
| Hon. Anne McLellan |
1425
| Mr. Michel Bellehumeur |
| Hon. Anne McLellan |
| Mr. Michel Bellehumeur |
| Hon. Anne McLellan |
| FRESHWATER EXPORTS
|
| Ms. Alexa McDonough |
| Hon. David Anderson |
| Ms. Alexa McDonough |
| Hon. David Anderson |
| NATIONAL DEFENCE
|
| Right Hon. Joe Clark |
| Hon. Alfonso Gagliano |
1430
| Right Hon. Joe Clark |
| Hon. Alfonso Gagliano |
| NATIONAL DEFENCE
|
| Mr. Charlie Penson |
| Hon. Art Eggleton |
| Mr. Charlie Penson |
| Hon. Art Eggleton |
| EMPLOYMENT INSURANCE
|
| Mr. Paul Crête |
| Hon. Jane Stewart |
| Mr. Paul Crête |
| Hon. Jane Stewart |
1435
| CENSUS RECORDS
|
| Mr. Grant Hill |
| Hon. Brian Tobin |
| Mr. Grant Hill |
| Hon. Brian Tobin |
| OFFICIAL LANGUAGES
|
| Mr. Benoît Sauvageau |
| Hon. Stéphane Dion |
| Mr. Benoît Sauvageau |
| Hon. Stéphane Dion |
| THE ECONOMY
|
| Mr. Jason Kenney |
| Hon. Brian Tobin |
1440
| Mr. Jason Kenney |
| Hon. Brian Tobin |
| TOBACCO PRODUCTS
|
| Mr. Jeannot Castonguay |
| Hon. Allan Rock |
| EMPLOYMENT INSURANCE
|
| Mr. Yvon Godin |
| Hon. Jane Stewart |
| HEALTH
|
| Ms. Judy Wasylycia-Leis |
| Hon. Allan Rock |
1445
| EMPLOYMENT INSURANCE
|
| Mr. André Bachand |
| Hon. Jane Stewart |
| Mr. André Bachand |
| Hon. Jane Stewart |
| GRANTS AND LOANS
|
| Mr. Jim Abbott |
| Hon. Brian Tobin |
| Mr. Jim Abbott |
| Hon. Brian Tobin |
| INTERNATIONAL TRADE
|
| Mr. Marcel Gagnon |
1450
| Hon. Pierre Pettigrew |
| Mr. Marcel Gagnon |
| Hon. Pierre Pettigrew |
| JUSTICE
|
| Mr. Bob Mills |
| Hon. Anne McLellan |
| Mr. Bob Mills |
| Hon. Anne McLellan |
| TOBACCO PRODUCTS
|
| Ms. Carolyn Bennett |
| Hon. Ethel Blondin-Andrew |
1455
| GRANTS AND LOANS
|
| Mr. Rick Casson |
| Hon. Pierre Pettigrew |
| Mr. Rick Casson |
| Hon. Pierre Pettigrew |
| REGIONAL DEVELOPMENT
|
| Mr. Yves Rocheleau |
| Hon. Alfonso Gagliano |
| CANADA CUSTOMS AND REVENUE AGENCY
|
| Mr. Paul Harold Macklin |
| Ms. Sophia Leung |
| AGRICULTURE
|
| Mr. Howard Hilstrom |
| Hon. Herb Gray |
1500
| SHIPBUILDING INDUSTRY
|
| Ms. Alexa McDonough |
| Hon. Brian Tobin |
| PRESENCE IN GALLERY
|
| The Speaker |
| The Speaker |
| BUSINESS OF THE HOUSE
|
| Mr. John Reynolds |
| Hon. Don Boudria |
| POINTS OF ORDER
|
| Bill S-15
|
1505
| Mr. John Reynolds |
1510
| Mr. Peter MacKay |
1515
1520
| ROUTINE PROCEEDINGS
|
| COMMITTEES OF THE HOUSE
|
| Public Accounts
|
| Mr. Derek Lee |
| Motion
|
| Foreign Affairs and International Trade
|
| Mr. Derek Lee |
| Motion
|
| BUSINESS OF THE HOUSE
|
| Mr. John Reynolds |
| Motion
|
| GOVERNMENT ORDERS
|
| SUPPLY
|
| Allotted Day—Federal-provincial fiscal arrangements
|
| Motion
|
| Mr. John McCallum |
1525
1530
| Mr. Yvan Loubier |
1535
| Mr. Mario Laframboise |
| Ms. Francine Lalonde |
1540
1545
| Mr. Serge Marcil |
1550
1555
| Mr. Mario Laframboise |
1600
1605
| Mr. Yvan Loubier |
| Ms. Francine Lalonde |
1610
| Mr. John McKay |
1615
| Mr. Yvan Loubier |
1620
| Mr. Marcel Gagnon |
| Mr. Lynn Myers |
1625
1630
| Mr. Yvan Loubier |
1635
1640
| Mr. James Moore |
| Mr. Marcel Gagnon |
1645
1650
1655
| Hon. Diane Marleau |
1700
| Mr. Clifford Lincoln |
1705
| Mr. Dennis Mills |
1710
1715
| Divisions deemed demanded and deferred
|
| MESSAGE FROM THE SENATE
|
| The Deputy Speaker |
| PRIVATE MEMBERS' BUSINESS
|
| COMPUTER HACKERS
|
| Motion
|
| Mr. Ted White |
1720
1725
| Mr. Art Hanger |
1730
1735
| Mr. Réal Ménard |
1740
1745
| Mr. Lynn Myers |
1750
| Mr. Larry Spencer |
1755
1800
| Ms. Val Meredith |
1805
1810
| Mr. Larry Bagnell |
1815
| ADJOURNMENT PROCEEDINGS
|
| Health
|
| Mr. Keith Martin |
1820
| Mr. Lynn Myers |
(Official Version)
EDITED HANSARD • NUMBER 069
HOUSE OF COMMONS
Thursday, May 31, 2001
The House met at 10 a.m.
Prayers
ROUTINE PROCEEDINGS
1005
[English]
GOVERNMENT RESPONSE TO PETITIONS
Mr. Derek Lee (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 nine
petitions.
* * *
[Translation]
COMMITTEES OF THE HOUSE
OFFICIAL LANGUAGES
Mr. Mauril Bélanger (Ottawa—Vanier, Lib.): Madam Speaker, I have
the honour to present the third and fourth reports of the
Standing Joint Committee on Official Languages.
The third reports on the committee proceedings on the
appropriations for the Office of the Commissioner of Official
Languages and approves them.
In the fourth report, the committee unanimously expresses the
wish that the government consider the advisability of increasing
funding for the Office of the Commissioner of Official
Languages.
HUMAN RESOURCES DEVELOPMENT
Mr. Peter Adams (Peterborough, Lib.): Madam Speaker, I have the
honour to present, in both official languages, the third report
of the Standing Committee on Human Resources Development and the
Status of Persons with Disabilities entitled “Beyond Bill C-2: a
Review of Other Proposals to Reform Employment Insurance”.
[English]
I am very pleased to present the report, which was endorsed by
all parties on the committee. This is not an easy thing for a
committee to do with a topic that attracts such great interest as
employment insurance.
The report is a deliberate follow up on the work this committee
did on Bill C-2, which the House passed. It deals with issues
that were raised by the 80 witnesses we received during the Bill
C-2 hearings. We tried to present the concerns of all of those
people to the government in this report.
I am most grateful to members of all parties on our 18 person
committee.
PROCEDURE AND HOUSE AFFAIRS
Mr. Derek Lee (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Madam Speaker, I
have the honour to present the 21st report of the Standing
Committee on Procedure and House Affairs regarding the selection
of votable items in accordance with Standing Order 92.
The report, in keeping with the tenor of the times, is
introduced on wrinkled parchment. The report is deemed adopted
upon presentation.
1010
I also have the honour to present the 22nd report
of the Standing Committee on Procedure and House Affairs
regarding the provisions of Standing Order 87(6), sometimes known
as the 100 signature rule for private members' business.
If the House gives its consent I intend to move concurrence in
the 22nd report later this day.
Mr. Peter Adams: Madam Speaker, I rise on a point of
order. At the end of my presentation of the report of the
Standing Committee on Human Resources and the Status of Persons
with Disabilities I forgot to ask that members of other parties
who were on our committee be given a short time to speak to that
report. I would be most grateful, if you would
seek unanimous consent to return to that item.
The Acting Speaker (Ms. Bakopanos): Is there unanimous
consent?
Some hon. members: Agreed.
Some hon. members: No.
[Translation]
Mr. Louis Plamondon: Madam Speaker, I had informed the House
that I intended to table an interparliamentary delegation
report.
The Acting Speaker (Ms. Bakopanos): You must get the unanimous
consent of the House. Does the member have the unanimous consent
of the House to revert to parliamentary delegation reports?
Some hon. members: Agreed.
* * *
INTERPARLIAMENTARY DELEGATIONS
Mr. Louis Plamondon (Bas-Richelieu—Nicolet—Bécancour, BQ): Madam
Speaker, pursuant to Standing Order 34, I have the honour to
table, in both official languages, the report of the Canadian
branch of the Assemblée parlementaire de la Francophonie, as
well as the financial report relating thereto.
The report deals with the meeting of the Commission on
Education, Communication and Cultural Affairs held in Cambodia
on April 2 and 3, 2001.
[English]
Mr. Derek Lee: Madam Speaker, if the House gives its
consent I would move that the 22nd report of the Standing
Committee on Procedure and House Affairs presented to the House
earlier this day be concurred in.
The Acting Speaker (Ms. Bakopanos): Does the House agree?
Some hon. members: Agreed.
Some hon. members: No.
* * *
PETITIONS
TRADE
Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP):
Madam Speaker, I am very pleased to present a petition signed by
a number of people in my constituency who join with other
Canadians in expressing their concern about free trade and, in
particular, the free trade area of the Americas agreement.
The petitioners are very concerned about negotiations involving
the free trade area of the Americas and the lack of access to
the details pertaining to this agreement. They want to see the
Government of Canada take decisive action to ensure that any
negotiations on free trade provide for the protection of our
health care system and our environment, and ensure that the
safety and security of Canadians is at the top of the list.
They call upon the government to adopt a new approach to
globalization that places social, economic and ecological justice
above the profits of multinational corporations.
* * *
QUESTIONS ON THE ORDER PAPER
Mr. Derek Lee (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Madam Speaker, I
ask that all questions be allowed to stand.
The Acting Speaker (Ms. Bakopanos): Is that agreed?
Some hon. members: Agreed.
* * *
[Translation]
BUSINESS OF THE HOUSE
Mr. Michel Guimond
(Beauport—Montmorency—Côte-de-Beaupré—Île-d'Orléans, BQ):
Madam Speaker, there has been consultation among all the parties,
and I believe that you will find consent for the following
motion. I move:
That the mover of today's opposition motion be deemed to be the
hon. member for Lévis-et-Chutes-de-la-Chaudière rather than the hon.
member for Saint-Hyacinthe—Bagot.
The Acting Speaker (Ms. Bakopanos): Is there unanimous consent?
Some hon. members: Agreed.
(Motion agreed to)
1015
Mr. Michel Guimond: Madam Speaker, I rise on a point of order. I
want to inform you that only the first speaker will split his
time. The others will follow the procedure provided for in the
standing orders.
GOVERNMENT ORDERS
[Translation]
SUPPLY
ALLOTTED DAY—FEDERAL-PROVINCIAL FISCAL ARRANGEMENTS
Mr. Antoine Dubé (Lévis-et-Chutes-de-la-Chaudière, BQ) moved:
That, in the opinion of this House, the government should call a
federal-provincial first ministers' conference for the purpose of
reapportioning the tax base among the federal and provincial
governments through the transfer of tax points.
He said: Madam Speaker, it is an honour for me this morning to
launch this debate on behalf of the Bloc Quebecois. This is, in
my opinion, a very important debate that addresses Quebec's
historical demands.
From the outset, I think it is a good idea to reread the motion:
That, in the opinion of this House, the government should call a
federal-provincial first ministers' conference for the purpose of
reapportioning the tax base among the federal and provincial
governments through the transfer of tax points.
In Canada, the financial situation of the two levels of
government, namely the federal and provincial governments, can
be summed up very simply: the needs in the health, education and
social services sectors are in Quebec and in the other
provinces, while the money is in Ottawa.
For several years now, Ottawa has been accumulating indecent
budgetary surpluses. This would be acceptable if Ottawa seized
this opportunity to withdraw from the area of taxation and left
it to the provinces or if it would transfer part of these
surpluses to Quebec and to the provinces, for health and
education.
But Ottawa would rather hide these surpluses and reallocate them
massively to reduce the debt. It even refuses to restore
transfer payments to the 1993 level.
The hon. member for Saint-Hyacinthe—Bagot has had, and will again
have the opportunity to demonstrate, with all the energy,
enthusiasm and seriousness that characterize him, this critical
aspect because this is what led to today's debate.
In the last federal budget, Ottawa's fiscal effort in the
transfers for post-secondary education is the lowest in 30 years.
As for health, the federal contribution is now only equivalent
to 14 cents for each dollar spent by Quebec.
Today's motion seeks to correct the fiscal imbalance and to
ensure that the revenues of each government are based on their
fundamental needs.
This is why the Bloc Quebecois is calling for a
federal-provincial conference for the purpose of reapportioning
the tax base through the transfer of tax points from Ottawa to
Quebec and the other provinces. In Quebec there is complete
agreement on this, and the premiers of some of the other
provinces share that consensus as well.
I prefer to leave discussion on the financial situation up to
the hon. member for Saint-Hyacinthe—Bagot, our finance critic, and he
will be speaking later in the day.
It is not difficult to figure out that the money is in Ottawa
while the needs are in the provinces. The federal government's
revenues have increased by 53% between 1993 and 2001, while its
expenditures have decreased by 3%. Over that same period,
Quebec's program expenditures have risen by 16% and health
expenditures by 32%.
In other words, the health sector alone represented 71% of the
increase in expenditures. Federal cuts in expenditures have
been at the expense of the provinces through cuts to transfer
payments. From the early 1990s to the present, federal
transfers to Quebec have dropped from close to 20% of Quebec
social expenditures to about 13%.
1020
The hon. member for Hochelaga—Maisonneuve will certainly
elaborate more on health.
Spending in education increased by only 3% from 1993 to 2001
because health was a priority. Things were already fiscally
tight.
This problem is due to the federal government, because its
financial contribution in terms of transfers for post-secondary
education is at its lowest level in 30 years, as I said earlier.
The federal government contributes less and less to the needs of
Quebecers. Between 1993 and 1999, its share has dropped from 23%
to 13.5%.
A bit of historical context of the tax point issue would be in
order. Tax points transferred to the provinces are not a kind of
federal assistance, nor are they an exercise of its spending power.
In fact, they contribute to balance the tax positions in the
federation, and this has nothing to do with the Canadian social
transfer for health, education and social services.
The tax point transfer to the provinces in the 1960s, aimed at
giving back to the provinces some of the tax room they had
yielded to the federal government in the 1940s, particularly to
finance the war effort.
Important dates should be remembered. In 1882, Quebec introduced
its tax on corporations. In 1892, it created inheritance tax. In
1917, the federal government introduced a personal income tax.
In 1939, Quebec collected tax on personal income. From 1941 to
1942, tax rental agreements were signed by which the provinces
agreed to refrain temporarily from collecting personal and
corporate income taxes and inheritance tax; in return, the
federal government agreed to pay them a rent for the war
effort.
In 1947 after the war, the federal government tried to renew
for five years the tax rental agreements for the purpose of
reconstruction. Quebec and Ontario refused and created their own
corporate income tax scheme. These two provinces also started
collecting inheritance tax again.
In 1952, the federal government maintained its approach and
offered a new transfer package to the refractory provinces.
Ontario accepted the offer, but not Quebec.
In 1954, Duplessis said “Give us back our booty”. Since it
failed to negotiate a partial withdrawal of the federal
government from the field of personal income tax, Quebec got
back on board with a rate equal to 15% of the federal rate.
Between 1960 and 1966, a series of tax points were transferred
to the provinces. In 1977, there was a federal-provincial
agreement on tax points, an agreement that excluded Quebec
which, supposedly, had received more than its share in 1966.
That tax point transfer has indeed been the subject of a
federal-provincial agreement. The provinces and the territories
received from the federal government a transfer of 13.5 tax
points for personal income tax and one tax point for
corporate income tax.
In 1997-98, the main tax point transfers to the provinces and the
territories amounted to $2.7 billion. These transfers are now
worth four times more, that is, $13.9 billion. That does not
mean that the federal government is transferring tax fields
worth $13.9 billion.
Tax points are, in fact, provincial revenues. Thus, the tax
point figures appearing in the various federal budgets are
simply the current value of the points transferred in the 1960s.
Here I would like to quote a comment Allan Maslove, a professor
at Carleton University's school of public administration, who
said that tax points are now an established component of the
provincial tax base and should not be viewed as a form of
transfer from Ottawa.
Historically, all Quebec premiers have expressed concerns over
the tax balance with Ottawa. By starving the provinces
financially the federal government, citing its spending power,
manages to impose its management conditions on certain areas of
Quebec jurisdiction.
1025
I mentioned earlier Mr. Duplessis, but I would like to point out
that Jean Lesage, at the federal-provincial first ministers'
conference in 1960, reiterated Quebec's position with respect to
federal spending power by decrying the conditional funding paid
to the provinces in the form of shared cost programs.
Following him, Daniel Johnson in 1966 renewed Quebec's
decision to opt out of established joint programs and not take
part in any new programs. In addition, he demanded that
Quebec's withdrawal be unconditionally fiscally compensated. He
said:
Joint programs are an obstacle to the unfettered growth of
Quebec. They impose priorities that may get in the way of those
Quebec would otherwise set, and limit its real budgetary
autonomy ... Joint programs freeze the fiscal resources of a
nation like ours and deny us full control over areas of activity
that rightfully come under our jurisdiction.
Mr. Johnson's successor, Jean-Jacques Bertrand, maintained
Quebec's position. He, too, denounced the exercise of federal
spending power.
Then it was the turn of Mr. Bourassa's Liberal government, which
also saw this spending power as a federal intrusion in Quebec's
jurisdiction.
Like his predecessors, Premier Bourassa felt that a new fiscal
balance would allow Quebec the full exercise of all its powers.
He said:
—we will only achieve a viable balance if, within the framework
of the general principle, we can ensure the necessary
flexibility so that each level of government has the revenue it
needs to exercise its fiscal powers without a negative impact on
overall growth and the balance of the various sectors of the
economy.
The government of Quebec's inaugural speech, read in the
national assembly in March 1973, made rebalancing tax sharing in
the federation a priority.
All this is to say that what we are asking for this morning is
consistent with what Quebec has asked for in the past, not just
under PQ governments but under all governments since Duplessis.
Mr. Pierre Paquette (Joliette, BQ): Madam Speaker, I too am
pleased to take part in this debate and to support the motion
put forward by the hon. member for Lévis-et-Chutes-de-la-Chaudière.
I believe this motion should get the support of every member in
the House. I would like to read it again in order to put the
debate in the right perspective. It reads as follows:
That, in the opinion of this House, the government should call a
federal-provincial first ministers' conference for the purpose of
reapportioning the tax base among the federal and provincial
governments through the transfer of tax points.
I think the situation is excessively simple and it is also
excessively dramatic.
As it was pointed out already, and I think this should be
stressed again, needs are currently under provincial
responsibility, like health, post-secondary education and social
services as a whole. All these responsibilities are at the
provincial level, whereas money is at the federal level, in
Ottawa. It is a situation that has to be corrected.
The strongest evidence that the money is in Ottawa is the fact
that between 1993 and 2001 federal revenues have increased by
53% while federal spending decreased by 3%. Meanwhile, in Quebec
program spending increased by 16%. I think these numbers
illustrate quite well the situation where needs are growing in
Quebec with a 16% increase in spending, while revenues are
increasing and spending is decreasing at the federal level.
This allows the federal government to accumulate surpluses that
are becoming indecent. From 1996 until now, there have been $60
billion in unforeseen, hidden surpluses. Over the years, the
Minister of Finance has erred by 130% to 400%. Can the
government pretend that such errors are inadvertent? I do not
think so. This is a federal government strategy to
undemocratically divert part of the taxes paid by Quebecers and
Canadians in order to use them for other purposes than those
that were announced.
The government has $60 billion in hidden surpluses since 1996.
These are systematic, deliberate errors. The member for
Saint-Hyacinthe—Bagot has done some calculations and has correctly
identified the surpluses over the last years, something the
Minister of Finance was unable to do.
1030
The member for Saint-Hyacinthe—Bagot, whom I congratulate for his
excellent work, had forecasted $60 billion in hidden surpluses.
He now tells us that in the next four years $90 billion in
surpluses will go into the federal government's coffers. What
for? To pay off the debt.
This is the most undemocratic action since the passage of the
so-called “clarity” bill, Bill C-20 tabled by the Minister of
Intergovernmental Affairs, who wants to lock in the Quebec
people and their right to collectively choose their future.
In my opinion, after passage of Bill C-20, the most undemocratic
thing the federal government has done is certainly diverting its
surplus towards paying off the debt.
Why? Because the Liberal government got elected on the promise
that 50% of the surplus would be used to cut taxes and reduce
the debt and the other 50% would be devoted to all programs,
particularly those under provincial jurisdiction.
Then we saw some low, despicable electioneering. The Liberals
went through the campaign saying that this is how they would
split the surplus, opposing their approach to the approach of
other parties like the Canadian Alliance. The Alliance was
proposing further tax cuts. The Liberals wanted to appear
progressive, but in fact they chose to repay the debt without
any public debate and they deceived the public.
I think this discredits the Liberal government and,
unfortunately, the whole of politics. I think we must condemn
such an undemocratic act and the conference we are proposing
would be the opportunity for a real public debate where we could
determine exactly what the surplus should be applied to.
Naturally, the Bloc Quebecois is not against paying down the
debt. However, when we pay down a good part of the debt with
hidden surpluses, without any public debate, in a way that is
detrimental to the quality of public services, especially
provincial ones, there is a big problem.
In this regard, I remind hon. members that the Minister of
Finance greatly paid down the debt with concealed surpluses, in
a way that was detrimental to health. This has been said before
but it warrants repeating. A few years ago, the federal
government funded 50% of all health spending in Quebec; it paid
50 cents on the dollar. Today, its share is only 14 cents on
the dollar.
At the same time, the federal government still wants to impose
national standards on us.
As for post-secondary education, the level of transfer payments
is at a 30-year low. Yet the liberals are telling us that investment in
education is the Canadian way. What a lie. Over the past few
years, federal transfer payments for post-secondary education
have gone from 12.5% to 8.3%. That is reality. It is not just
words, but reality.
A third element consists in the wholesale paying down of the
debt with the concealed surplus, while refusing to restore
transfer payments to the provinces to their 1993 level, a time
when federal public finances were in a sorry state. This means
that today federal transfer payments for program funding in
Quebec have gone from their 1990 level of 20% down to 13%. This
is a real problem.
We in the Bloc Quebecois have a solution for resolving this
problem of fiscal imbalance. As has been said, this is a
problem that goes back in history. During World War II, the
provinces did indeed give up this source of revenue in order to
contribute to the war effort. This is a situation we now need
to remedy.
It is clear to the Bloc Quebecois that the best solution is
Quebec sovereignty. With Quebec sovereignty, we would
repatriate all of our taxes, make collective decisions and
avoid the anti-democratic situation in which we find ourselves at
the present time within the Canadian federal system, this
systematic lack of democracy. The best example of this is the
way the employment insurance fund surplus has been diverted and
the way the surplus that came from all taxpayers has also been
diverted.
Quebec sovereignty is therefore the choice that should be made
here, but until that time it seems to us that for the good of
Quebec and for all the provinces as well, all members of this
House should agree with this motion. The government must sit
down with the provinces in order to reapportion the tax bases
and transfer tax points, which would become the property of the
provinces, so that they may assume their responsibilities in the
areas of health, education and all the social services.
1035
That has already been mentioned. Historically speaking, all
Quebec premiers, regardless of their position on the national
issue, called for the re-establishment of a fiscal balance, be it
Duplessis, Lesage, Johnson, senior, Jean-Jacques Bertrand, Robert
Bourassa, René Lévesque, Pierre-Marc Johnson, Daniel Johnson Jr.,
Jacques Parizeau or Lucien Bouchard.
All these premiers wanted to rectify a situation that may be
explained historically witch dates from the second world war.
The federal government has systematically fought the desire
of Quebec and the provinces to return to the situation that
existed prior to the second world war.
To this, I must add an element in the debate, which I think will
be picked up by the member for Hochelaga—Maisonneuve.
This fiscal imbalance exists in the context of a social union,
something that is extremely dangerous for the future of Quebec,
because the other provinces have legitimized the federal
government's intervention in Quebec's jurisdictions.
Quebec refused to sign the social union—which we agree with
entirely—but in the context of fiscal imbalance, the provinces
see their jurisdictions threatened.
The most amusing illustration of that perhaps was the
millennium scholarships, in which the federal government did
everything possible to ensure a little maple leaf appeared on
the cheques.
It seems to me that the motion proposed by the member for
Lévis-et-Chutes-de-la-Chaudière speaks for itself.
Nevertheless, I would like to move the following amendment to
the main motion. I move:
That the motion be amended by adding after the word “conference”
the following: “, as soon as possible,”.
I think the situation is pressing. It is dramatic.
The federal government must call this conference. All the
provincial premiers are calling for it.
The Acting Speaker (Ms. Bakopanos): The amendment is in order.
Debate is now on the amendment.
[English]
Mr. Tony Valeri (Stoney Creek, Lib.): Madam Speaker, it
is a pleasure to rise in the House this morning to speak on the Bloc
motion, although I speak on it with some surprise. We have the
Bloc asking for a first ministers conference to discuss the
reapportioning of the tax base among the federal-provincial
governments through the transfer of tax points. I am also
surprised by the assertion of the Bloc that there is an imbalance
between the provincial governments, or in this instance between
Quebec and the national government.
As I listened to a couple of the speeches a few moments ago,
there was also a substantial amount of rhetoric with respect to
what the government was doing with the surplus and how we were
managing our approach.
From the outset, I disagree with the statements made by the Bloc
members that the government was not taking a balanced approach to
its financing. When we look what we did with our tax file and
our reinvestment in health care and post-secondary education,
along with the debt repayment, it clearly reflects what Canadians
have said to the national government. In fact they have said it
to the finance committee.
1040
I also found it quite humorous that a member across the way
talked about how we were not consulting Canadians. If we look at
the prebudget consultation process that was put in place when we
took office, I believe it was more transparent and more open than
any prebudget consultation. It was probably the most transparent
approach to building budgets in the history of the country.
There have been a couple of statements already made by the Bloc
that I have some difficulty with and I will address them as I
continue my discussion this morning.
The point I would like to make at the outset is that while the
Bloc has put this motion in front of the Chamber and has asked
members to consider the idea of calling together first ministers
to discuss the issue, first ministers meet often. This is an
issue could be added to an agenda for discussion, but I find it
outrageous that the Bloc would put forth a motion to discuss tax
points, when according to the Bloc it does not mean anything.
Therefore, I am a bit confused when I try to comprehend why it
would need more tax points.
I would like to illustrate that point by the fact that since I
have been in the House, dating back to 1993, and in the various
debates which have taken place in the House, the Bloc has never
acknowledged the value of tax points. That was said earlier by
the hon. member across the way when talking about the federal
government's contribution to health care in the province of
Quebec. Just to clarify the record about health care and the
value of tax points and cash, it is 30 cents of every dollar
rather than the 14 cents as the hon. member said.
Again, the Bloc members have made a statement that they want
first ministers to get together to discuss the issue of more tax
points for the provinces, yet at the same time they never
acknowledged the value of tax points. So I have some difficulty
with that position. It is quite a contradiction on their part.
Also, there is no consensus among provinces on this issue.
Unlike Quebec, many provinces in this federation would prefer
additional cash funding instead of additional tax points. We
would have to also acknowledge that the change the hon. members
across the way are suggesting would lead to some inequities among
provinces as well.
Let me point to an example where tax points are worth more in
prosperous provinces than in less prosperous ones. One personal
income tax point is worth $35 per capita in Ontario but only $17
in Newfoundland in the year 2000.
The cash component of the CHST ensures that all provinces get
the same amount of funding per capita. Also, and this may be a
point that the hon. member from the Bloc has great difficulty
with, the cash transfers also enable the federal government to
uphold national values. I point to the principles of the Canada
Health Act and the prohibition on the minimum periods of
provincial residency to receive social assistance. We had a
situation like that recently where the cash transfers actually
acted as a lever to ensure some upholding of national values.
The other point that the members across the way made was the
issue of fiscal imbalance between the federal government and the
provinces.
1045
If we look at the facts, there is no fiscal imbalance between
the federal and provincial governments. The majority of
provinces, 7 out of 10, had balanced budgets in 2000-01 and 8 out
of 10 provinces are projecting surpluses for the year 2001-02.
The fact that provinces can balance their budgets and reduce
taxes means that they have sufficient resources at their
disposal. I should also point out that all provinces have
reduced taxes since 1995.
I also have some difficulty with the assertion of the Bloc
member that in some way provinces are junior players in the
Canadian federation. That is not the case. Provinces are not
junior players in the Canadian federation.
They have access to all major tax bases open to the federal
government. They levy personal and corporate income taxes as
well as sales taxes. They also have unique access to some of the
fastest growing revenue sources. While there is some debate
about the revenue sources, the provinces nonetheless have access
to revenue sources like gaming, liquor and natural resources.
When I look at the facts I have to disagree with the hon. member
across the way when he talks about the imbalance that exists
between the federal and provincial governments.
I would acknowledge, as would any member of the House, that
provinces obviously face spending pressures. I hear it every day
in my community, as I am sure many members hear it in their
communities. The provinces face pressure with respect to health
care and education. We all know that those two issues are
extremely important to Canadians. Members across the way,
particularly those in the Bloc, must acknowledge that the federal
government recently announced a 35% increase in cash funding in
five years in support of these programs through the Canada health
and social transfer.
The Bloc put forward some points this morning with which I would
agree. There are spending pressures in the provinces with
respect to health care and education. It is incumbent upon the
Bloc to recognize that the national government has played a role
in helping to ease those pressures and to reflect what Canadians
are telling federal members of parliament, for example that
health care and education are priorities, so that the national
government responds to those issues.
It is also incumbent upon Bloc members to recognize the value of
tax points. Perhaps they are doing that now. Hopefully later
today those members will rise to acknowledge the value of tax
points. Up to this debate Bloc members have consistently ignored
tax points and have said that they have no value. Yet today they
are asking for more tax points and for a first ministers meeting
to attempt to accomplish that.
It is important to point out the financial picture we are facing
when we talk about the relationship between the federal
government and the provinces. Compared to the provinces, the
national government faces a much higher debt burden. In fact
federal spending on interest payments is 25 cents per dollar of
revenue and provincial spending on interest payments is only 12
cents per dollar.
We certainly face some challenges as a national government. We
are prepared to deal with them. We are attempting to pay down
the debt at the same time. We have always maintained in the
House, since coming to office in 1993, that our approach would be
a balanced one. We would not take an extreme approach to
governing and working with Canadians.
The hon. member across the way also made the point this morning
that the national government was running surpluses at the expense
of provincial fiscal stability. I have to disagree with that
statement. Our federal priorities are reflected in the recent
actions that have been taken, namely the $100 billion in tax
reductions to provide savings to Canadians and to spur economic
growth.
That type of tax plan will help provincial economies to prosper.
1050
Since coming to the House I have consistently stated as a member
of parliament that there is a relationship between a reduction in
tax and the economy growing. I believe we must maintain a
balanced approach. We do not want to jeopardize the very real
priorities of Canadians, those being health and education.
There have been substantial increases in transfers to the
provinces to support social programs. To date Bloc members have
not recognized the value of tax points. I am hoping that today
they will stand to recognize the value of tax points and
recognize the role the national government plays in reflecting
Canadian priorities and in supporting provinces in partnership to
address provincial issues, which in many cases are national
issues as well.
Tax points are a very important way in which the federal
government transfers money to the provinces. My colleagues on
this side of the House will be explaining how important they are.
It is not the only way in which transfers occur. I would like to
spend a few moments telling the House and Canadians about some of
the others ways the national government transfers funds to
provincial governments. If we want to understand what is
happening and if we want to see the whole picture, we have to
consider the full range of ways in which the federal government
transfers resources to the provinces.
I will focus for a moment on the province of Quebec and make
reference to other ways the province of Quebec receives funds
from national programs. The province of Quebec receives 26% of
federal research dollars, 33% of industrial R and D, 32% of
health research funds, 26% of infrastructure dollars, 30% of CFI,
29% of funds allocated for research chairs, and 50% of technology
partnership funds.
When we talk about the transfer of funds it is incumbent upon
everyone to recognize that the transfer of dollars to provinces
occurs in a number of ways, tax points being one. It is
refreshing to hear that the Bloc is now recognizing that tax
points have value. Cash transfers are another way of
transferring money to provinces.
Let us look at the Canada health and social transfer. It is
certainly what many Canadians would say is the most important
transfer to provinces because of the programs if funds and in
turn what those programs mean for families and their communities.
Out of that transfer the provinces fund health care,
post-secondary education, social assistance, social services and
early childhood education.
I should like to present some historical context because it is
important to go back in history, as my hon. friends across the
way often do, to understand what we are talking about this
morning. In 1996 the CHST, a single consolidated transfer,
replaced two programs. It replaced the established programs
financing which supported health and post-secondary education and
the Canada assistance plan which contributed to social
assistance.
The CHST transfers money to provinces and territories that helps
fund these programs. At the same time, I emphasize, it gives
provinces the flexibility to allocate those dollars to their own
priorities.
1055
Last September, some eight months ago, the Prime Minister and
first ministers from across the country reached an agreement that
included a strengthening of the financial commitment to the CHST.
It is important to note as well that the first ministers gave
Canadians their commitment to strengthen and renew health care
services through partnership and collaboration, with the federal
government being an equal partner in this renewal.
That commitment set out a five year stable funding plan which
would mean a transferring of an additional $21.1 billion through
the CHST. That agreement had an immediate impact. In 2001-02
the provinces and territories will receive $18.3 billion in cash.
That will significantly help to accommodate some of the
increasing pressures outlined this morning with respect to the
many CHST funded programs. In fact that number will rise
steadily to $21 billion by 2005-06.
The funding commitment was also accompanied by a renewed
commitment to the Canadian health care system which was the
latest in a series of important CHST related investments on the
part of the federal government.
I should like to take a minute to think about some of the
measures the federal government has announced in the last few
years. In 1998 we raised the annual CHST cash floor to $12.5
billion. The 1999 budget announced an $11.5 billion cash
investment in health. The 2000 budget provided a further $2.5
billion in cash. In the last two years alone the federal
government announced CHST cash transfers of over $25 billion.
As I said at the outset, our debate today has to consider the
whole picture when we talk about transfers to the provinces.
Certainly the CHST may be the most important transfer to
Canadians, but when we look at the way dollars are transferred to
provinces we would be hard pressed to think of a transfer more
typically Canadian than equalization.
In terms of policy, equalization means that the federal
government helps to reduce disparities among provinces and
regions and helps to ensure that all Canadians, regardless of
where they live, have access to quality services.
In closing, although I could probably speak to this issue for
the entire day, it is fair to say I have some difficulty in
understanding the rationale behind the Bloc proposing the
motion. Back in 1993-94 the Bloc never recognized the value of
tax points. Now it is asking for more tax points. Its members
talk about the fiscal imbalance between the federal government
and the provinces. That is clearly false. Since 1993 we have
been very open and transparent with respect to surplus and with
respect to building budgets.
I cannot believe for one moment that the Bloc has any real
interest in pursuing the debate and dealing with the facts, given
that its only purpose is to continue to bring forward statements
that are questionable in some cases. I certainly respect the
opinion of my hon. colleagues across the way, but I respectfully
disagree with a number of points they made this morning.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Madam Speaker, I
listened carefully to the member for Stoney Creek. It is not out
of ignorance that he made such ill-chosen remarks. He is familiar
with the issue since he was, for a few years, the Parliamentary
Secretary to the Minister of Finance. I find it hard to
understand how he is approaching the issue and how he can make
such ill-advised comments.
First, he said that the Bloc Quebecois never cared about tax
points. The fact is that we have cared about them since we first
got here.
As early as 1994, we suggested that the transfer of tax points
to the provinces, particularly Quebec, would provide some
protection against the deep cuts made by the Minister of
Finance—who was putting his fiscal house in order at the expense
of others—to the Canada social transfer, for health, education
and income support.
1100
We were the first ones in 1994 to raise the possibility of
transferring tax points in order to free up some area of
taxation for the provincial governments, so that they could
protect themselves against the federal government's slash and
burn approach. Second, we were also concerned about the
interpretation made by these professional demagogues of the use
of tax points.
In the 1960s, the federal government transferred tax points,
specifically at the Quebec City conference in 1964. Mr. Pearson was
much more open-minded than this bunch of demagogues. In 1977,
he transferred other tax points, freeing up the tax field and
telling the provinces “From now on, I will look after my
responsibilities in certain areas of jurisdiction, and I leave
the tax field to you. You can collect taxes in my stead”.
Once you sell your house, you no longer have a say in what goes
on there. That is the business of the new owner.
It is the same thing with the tax points. The Bloc Quebecois is
denouncing the demagogic use the Liberals are making of these
tax points transferred in the 1960s and 1970s. Do members
realize what this allows them to say as a result? It allows
them to say “On the contrary, we increased the Canada social
transfer”.
The government has managed to almost double the value of federal
transfers by factoring in old tax points over which it no longer
has any say; the house has been sold. There is a new owner.
The government's figures are misleading.
So, I ask the member for Stoney Creek how he can grandstand on
an issue as important as this. He will recall, if he knows his
Canadian history—although he does not seem to; it is a bit odd
that a sovereignist is instructing a federalist on Canadian
history—that in the 1960s and 1970s, we were looking at a fiscal
imbalance. In those days, there were intelligent people on both
sides, in Quebec and in the rest of Canada, who could sit down
together and negotiate new tax sharing agreements. Could we see
a little more intelligence and a little less grandstanding and
cynicism on the other side of the House?
[English]
Mr. Tony Valeri: Madam Speaker, I am always interested to
hear from my hon. colleague along the way. I had the opportunity
to spend a bit more time with him when I was much more involved
as a parliamentary secretary with respect to finance issues and
the finance committee. His enthusiasm for his perspective has
not diminished at all.
I still find it somewhat ironic that perhaps he was not
listening earlier this morning when two members of his party were
in debate and were talking about the participation of or the
expenditure made by the national government with respect to
health care in his province. I stand to be corrected, but I
certainly understood the member to be suggesting that we were
only participating to the tune of some 14 cents per dollar. If
we calculate the cash transfer and include the tax points it is
closer to 30 cents per dollar.
The hon. member might want to stand in his place and say that
when members of his party first got here they acknowledged the
tax points and the value of tax points. However when putting
forward their position they continue in their rhetoric and
continue to ignore the value of tax points and only speak about
the cash portion.
If we take the position put forward by the hon. member, and this
occurred a number of years ago, we must ignore the room that was
ceded to the provinces with respect to tax points. I am not sure
whether the hon. member is suggesting that we were to freeze the
value of tax points back then. If we look at the value of those
tax points today and the room that was ceded to the provinces,
they are worth six times more today than in 1977. They were
worth $2.7 billion then and today they are worth $15.7 billion.
We cannot have it both ways. While we acknowledge that the tax
room was ceded to the provinces at that time, we cannot ignore
the fact that those tax points were ceded by a national
government.
When we talk about transfers to provinces we must continue to
look at the whole picture, and the whole picture involves the
transfer of cash and the transfer of points.
1105
When I meet with my constituents, and I am sure many members
across the way meet with theirs, they are pressing the national
government to ensure that it maintains some type of system of
equality across Canada. Cash transfers are the way that is done.
That is the way we uphold Canadian values and, for instance, the
Canada Health Act. Equalization is the way we attempt to
maintain equality of services for all Canadians across the
country when some provinces are more prosperous than others.
We understand and accept that provinces have funding challenges,
but it is somewhat irresponsible to suggest that the national
government has played no role in trying to assist provinces. We
must define the way we participate in that partnership. That is
quite clear.
We help fund health care and post-secondary education and we do
so by tax points and cash. I ask the hon. member to not only
recognize that tax points were ceded back then but to acknowledge
that tax points play a role in transfers to the provinces.
Mr. Scott Reid (Lanark—Carleton, Canadian Alliance):
Madam Speaker, the member was erudite and thorough in his
response. He made the point that the value of tax points ceded
in the 1970s has grown sixfold. I do not know if that is in
purely nominal terms or in real terms. I suspect it is in
nominal terms. Nevertheless they have grown over time.
That is the great virtue of tax points as opposed to simple
transfers that take place through the equalization system or
through the CHST. Such transfers do not grow and therefore do
not respond to the growing need for provincial expenditures in
health care, education and other areas that will grow over time,
particularly health care as the population ages.
What justification can be given for not ensuring that our health
care system, which is by consensus across the country the most
valuable of all our social programs, is funded through an
expanding, guaranteed tax base that cannot be cut as was the CHST
or its predecessor in the early to mid-1990s by the Liberal
government? Those cuts left provinces in the lurch and created a
funding crisis which continues to this day, notwithstanding the
partial and very tardy, if I may say, return of some of those
funds to the provinces.
Looking at those two options, what would be the principal reason
for denying provinces a predictable tax base whereby they could
operate the most important of all social programs at their
disposal?
Mr. Tony Valeri: Madam Speaker, I hope the hon. member
across the way does not disagree with what I am about to say. He
acknowledged that tax points continue to grow and will continue
to grow. However it is important to recognize, and I hear this
from my constituents on a consistent basis, that Canadians want
to see the national government play a role in national programs.
The province of British Columbia wanted to impose a residency
requirement for the collection of social assistance. The only
reason the decision was reversed was that the national government
would have held back a cash transfer which would have imposed and
reflected what Canadians were saying. They want national
programs which, if not exactly the same from province to
province, at least adhere to specific criteria to some extent
like the health care program and social assistance programs.
Why is there a cash portion in our transfers? It is to ensure
that national standards or a national approach to these programs
is clearly evident. We have seen that with respect to social
assistance and we want to see it with respect to health care.
1110
Mr. Stockwell Day (Leader of the Opposition, Canadian
Alliance): Madam Speaker, at the start of my comments I
advise that I will be splitting my time today with the member for
Lanark—Carleton.
Relating to the response and the question we have just heard,
the British Columbia government passed a requirement that for
healthy, employable people moving into the province, and it was
very clear on that, there would be a three month residency
requirement before they could access social services. That was
the B.C. government supported by its population.
Because it ran counter to federal Liberal philosophy that the
program should be available even to healthy, able-bodied people,
the government put pressure on the B.C. government and said that
it would fine that government every day the policy was in place.
That was in direct contradiction to the democratic request of the
people of British Columbia.
If we asked most Canadians whether there should be some kind of
stipulation for healthy, employable people not to be able to
immediately access social welfare programs, I think most would
agree that there should be some kind of regulation and would not
be in agreement with the federal Liberals.
It gives me great pleasure to rise today to concur with the Bloc
Quebecois on the motion. I am being very careful in saying that.
It is not often I am able to do so. On many issues such as the
great question of national unity we do not agree with the Bloc,
but wherever possible, as is the Canadian way, we strive to find
common ground and proceed from there.
[Translation]
Today we are telling the government there is a common ground. We
are asking the government to meet with the provinces to discuss
the transfer of tax points.
[English]
The transfer of tax points was actually our policy before the
formation of the Canadian Alliance. During the last election
campaign the Canadian Alliance once again made the proposal to
transfer more tax points to the provinces. It is therefore
appropriate that we call upon the government to meet with the
provinces to discuss, at the very least, the next step in a
process which was begun by the Liberals in 1977. With the usual
glacier-like speed of government we are trying to get the issue
addressed.
All stakeholders should meet to discuss such a change because it
affects all provinces. Therefore it should not be done
unilaterally as the federal Liberals like to do on too many
occasions. It is important to hear from all provinces so the
merits and demerits can be properly considered.
[Translation]
Governments across Canada want to provide comparable services to
all their citizens, regardless of where they live. We want these
principles to be upheld; they are part of the Canadian
tradition.
[English]
Allow me to put the issue in context by making an historical
reference. The Rowell-Sirois commission, which was struck in
1937, made a proposal that only the dominion should levy income
taxes. Although the proposal was initially rejected, when the
war broke out it was adopted by the provinces strictly as a
wartime measure. The provinces abandoned their income taxes and
in return were supposed to receive unconditional payments to
compensate them for that lost revenue.
In its agreements with each province the federal government
undertook that at the end of the war it would reduce federal
taxes so as again to create room for the provinces to resume
levying their income taxes. In 1977 the Liberal government of
the day ceded back to the provinces some of the tax room that the
federal government had taken away. However the arrangement has
been frozen since 1977.
[Translation]
The compromises provincial governments had to make 50 years ago
to support the war effort must be recognized. The current
Liberal government must act accordingly. We are not asking it to
be generous, not at all, rather we are asking it to give back to
the provinces the powers that are rightfully theirs.
[English]
A further transfer of tax points would also address two
fundamental problems. The first is the present mismatch between
the responsibilities of the provinces and the power they have to
tax.
1115
Last year three noted economists wrote a paper arguing that
there “is a fundamental mismatch between the taxing power of the
federal government and its restricted spending jurisdiction”.
That is, the federal government simply takes in too much money
compared to its constitutional responsibilities. It is an
imbalance.
That generates the political problem of democratic
accountability, since the government that raises the taxes, in
this case the federal government, does not actually spend the
money. Instead, the federal government transfers cash back to
the provinces in the form of the Canada health and social
transfer.
This means the federal government can cut the transfer
arbitrarily, as the federal Liberals have done throughout their
time in office. It has been their consistent approach. This has
forced provinces to make drastic cuts in their areas of social
spending, notably health care, and also undergo the consequent
displeasure of the electorate. If the government does not
transfer the full amount of resource, then provinces have to
cutback and experience voter displeasure.
The CHST is still lower today than when the Liberals came to
power eight years ago. They have removed a cumulative $25
billion from the CHST, but since they do not deliver the programs
funded by the CHST the provinces then wrongly take the political
blame for those cutbacks.
A further tax point transfer would help to realign democratic
accountability, and that is what we are talking about. No longer
would the federal government be able to reduce funding
unilaterally and then place the blame for cutbacks on the
provinces, as the federal Liberals have done consistently in the
past.
The second problem is a related one. It simply has to do with
trust. For the last seven years the federal government has
rejected its responsibility for health, social and post-secondary
education spending. As a matter of fact, it has spent over $100 billion on
grants and contributions, while sacrificing the most important
social programs which Canadians want.
Canadians are asking us how the federal government can then be
trusted in the future to preserve that which is most valuable to
Canadians? There is a lack of trust because of the history of
the federal Liberals in this area. I believe that if the federal
government feels it is necessary it will again act in a cynical,
political way to abandon health care, if it is health care where
the pressure is, or off-load cuts to education and social
assistance to the provinces in order to preserve other items for
their own public image. That has been their past history. I
believe we run the risk of seeing that to be their future
performance.
The present system of fiscal transfers encourages federal
irresponsibility. The logical step to restore confidence and
trust in the security of funding for our social programs is to
realign the taxing power with the spending power, as indicated in
our constitution, to make sure the government, which has the
constitutional responsibility to deliver program, also has the
power to go to its electorate to raise the money to pay for the
program.
Can we trust the provinces? That is the next fair question. I
believe we can. We can trust the provinces because those
governments are all returned to office, or replaced and new ones
brought in, by the very electors who share a broad democratic
consensus for the need to have strong support for the social
programs, especially health care. I remind the House that while
the federal government was cutting over $6 billion per year from
cash transfers for health, the provinces were increasing health
care spending. They have proven their level of trust. They have
earned the trust of Canadians and the government has not.
[Translation]
The issue of tax point transfers enjoys broad support among not
only the provinces, but also the opposition parties in the House
of Commons.
[English]
This area is one of great concern, as we have indicated. In
1997 Jean Charest's platform promised to convert $12.5 billion in
CHST cash transfers to tax points in exchange for reaching a
covenant defining federal and provincial roles in supporting
health, post-secondary education and social programs.
[Translation]
This is an excellent position, which we fully support and about
which we continue to be in agreement with Mr. Charest.
1120
Accordingly we were very surprised and disappointed last week
when we read what the current Conservative leader had told Le
Soleil. I want to quote from the article:
Bernard Landry faces an uphill battle in bringing Ottawa to
agree to the transfer of tax points to the provinces. Even the
Conservative leader is refusing to get involved in this fight.
For the time being, in any case, it is not one of his
priorities. Therefore he will not champion it in the House of
Commons or anywhere else in Canada.
[English]
That is why we support the Bloc motion.
Mr. Rob Anders (Calgary West, Canadian Alliance): Madam
Speaker, does the Leader of the Opposition agree that the
Liberals should wait until after the summer before the House of
Commons votes on the MP compensation package, so that MPs have a
chance to hear from their constituents before voting on a pay
increase?
Mr. Stockwell Day: Mr. Speaker, the question is good.
Because of the time allotted for this particular debate, I do not
want to depart from the importance of the subject of the tax
point transfer.
We will address the question of the MP pension plan because that
is a transfer of cash to members of parliament, and citizens
really want to know where we stand on that. It is a very
important issue, but I do not want to deflect from this issue of
calling together the provinces to talk about transferring the tax
points to them, which the federal Liberal government took away
some years ago.
Mr. Bill Blaikie (Winnipeg—Transcona, NDP): Madam
Speaker, I have a question for the Leader of the Opposition.
Could the Leader of the Opposition tell us whether his party is
committed, regardless of its position on tax points, to
maintaining or perhaps even expanding the cash portion of the
transfer from the federal government to the provinces with
respect to health care and post-secondary education?
From our point of view, the cash transfer is very important
to maintain national standards. If we do not have anything to
withdraw, or not transfer, or if national standards are not being
met, for instance the conditions of the Canada Health Act, then
the federal government loses its power to enforce national
standards.
Could the Leader of the Opposition tell us whether his party is
committed to maintaining the cash floor either as is or in an
enhanced way, and whether or not his position on tax points in
any way suggests that the cash floor should be eliminated?
Mr. Stockwell Day: Madam Speaker, the ability of the
provinces to continue to finance their programs under CHST,
especially health care, is critically important. I can answer
the hon. member's question by repeating the Canadian Alliance
position, especially related to health care.
Not only should we maintain the five principles of the Canada
Health Act, but we should add a sixth principle which would
legislate the funding level for health below which the federal
government could not go. That would put in place the assurance
our citizens need that we would not see for political purposes
the arbitrary reduction of the value of that portion.
Therefore, we would be not only supporting the cash transfer,
but also the minimal level and restoring the full amount of the
cash transfer, which still has not been done to the 1994-95
levels. Therefore, restore it to those levels and put into law
the principle of a legislated amount below which the federal
government could not go.
Mr. Dick Proctor (Palliser, NDP): Madam Speaker, I
listened with interest to the leader's remarks in this area. In
his previous capacity as the treasurer for the province of
Alberta, he will know, in terms of the farm situation, that in
recent years the Liberal government made much of the fact that
funding for farm aid programs was in the 60:40 ratio; 60% from
the federal government and 40% from the provinces. The
government would have us believe that has been the case
since confederation. However there are all kinds of examples to
indicate that it is a relatively new phenomenon.
I just came from a meeting of the agriculture committee at which
it was made very clear that the have provinces, which would
include Alberta, Ontario and Quebec, were probably better able to
finance farm programs, such as the AIDA program and now the
Canadian farm income program, than some of the have not
provinces, including Manitoba and Saskatchewan at this point in
time, as well as I suppose the Atlantic provinces.
1125
Could the Leader of the Opposition comment on that and indicate
what his party feels should be done in this instance?
Mr. Stockwell Day: Madam Speaker, in response to the hon.
member, there is an equity even in terms of how certain
agricultural policy is applied. We have proposed a number of
very clear initiatives that would help the entire agricultural
community, regardless of whether they are so-called have or
have not provinces.
First, there needs to be an aggressive initiative on the part of
the federal government to negotiate downward with the United
States and the EU community the subsidies which right now put us
at a competitive disadvantage. For instance, it has not put
together the leveraging power of the Cairns Group of countries on
the agricultural side to pressure the United States. The federal
government needs to do that.
It also needs to deal with the question of the Canadian Wheat
Board. There is an inequity among provinces. The Canadian Wheat
Board binds western provinces to market their grain through that
wheat board, not having the choice or the ability for alternate
sources of marketing. Ontario and Quebec are not bound by that.
In fact, a farmer wanting to look at value-added processing would
have to sell his or her product to the wheat board, buy it back
at a higher rate and also add in the grain transportation cost
even though there might not be any transport of the grain. That
needs to be dealt with.
In terms of grain transportation, efficiency and market
realities have to be put into the grain transportation system.
On the tax side, the taxes on farmers and on agricultural
business have to be significantly reduced so we get the value
added going in. The agriculture fees the federal government
charges need to be reduced; $300 million alone just on the
fertilizer. As well, diesel costs, excise tax and the GST on
fuels should be lowered so the government is not taxing on tax.
Those are a number of things that need to be done in the
agricultural community.
Mr. Scott Reid (Lanark—Carleton, Canadian Alliance):
Madam Speaker, I will start by deviating from the prepared
remarks I have and comment on the question that was raised by the
hon. member for Winnipeg—Transcona. Presumably he was referring
to CHST payments and Bloc grants.
I was involved as the Reform Party's senior researcher in 1995
or 1996 when the CHST legislation was proposed. It was really a
rehashing of the legislation that permitted the former Canada
assistance plan and the established programs financing plan to
exist. We put forward some detailed amendments which, like all
amendments that came forward in committee, were of course voted
down and never given a fair hearing.
At that time I looked at the details of funding and how it was
withheld when non-compliance occurred with federal standards
under the CHST. What was striking about it was how utterly
discretionary it was.
For instance, the Minister of Health decided whether a violation
has taken place. The Minister of Health at his or her sole
discretion decides whether or not a penalty is appropriate, what
the amount of that penalty should be, whether it should apply in
one province but perhaps not in another province and if
compliance has not been achieved whether the penalty should
continue. What we see is a situation in which we do not have a
standard that is enforced by any kind of impartial mechanism.
We have a standard that is enforced, if it is enforced at all,
based on political considerations. Is it a province in which the
government holds a lot of seats? Is it a province in which it
might hold a lot of seats in the future, if it does the right
thing? Is it a province that is assertive in standing up for its
rights or is it one that can be easily intimidated by the
government? Is there an election coming? Has an election just
occurred? Is this going to play well elsewhere in the country?
There is a whole series of considerations that have nothing to do
with providing for satisfactory health care.
We made recommendations at that time that would have created
some form of right of appeal of citizens or of provincial
governments before the Federal Court of Canada. The court would
then make the decision whether or not a standard was being
violated.
1130
It would also have the salutary effect of actually defining some
of the national standards under the Canada Health Act, which are
often not as clear as they ought to be. That would have been a
real step forward. All of that was put aside. Much of it was
actually incorporated in the 1997 Conservative platform which my
leader cited today.
The idea of trying to get co-operative national standards is a
bit more detailed than finding some form of standard to which
there is an agreement to co-operate with and therefore an
enforcement mechanism. None of that has been done. Therefore we
would find that the Canada Health Act and the block transfers
that are given under the Canada health and social transfer would
continue to be as they are now, that is, extremely ineffective in
ensuring enforceable, meaningful national standards.
I would now like to draw the House's attention to the fact that
the motion we are debating today fits within a growing stream of
voices from across the country that are calling for an end to the
imbalance that exists under which the provinces have the vast
majority of the spending needs. It is because they are assigned
the most important social programs under our constitution and
under which the federal government draws in most of the revenue
and therefore redistributes it. This is a problem that has
existed for a very long time.
If we look back to Confederation, the Fathers of Confederation
provided for per capita cash transfers that continue to this day
but they are very small because they were in nominal dollars and
the economy has grown and inflation has taken place.
Nevertheless, there was a system set in place for transfers to
provinces and, I should mention, these were non-discretionary.
They could not be withheld for any reason. Therefore there were
some assurances the provinces would operate effectively within
their spheres of jurisdiction.
Listening to the voices in recent decades over the need to
return to the original intent and spirit of the constitution, we
find that many of the voices have come from Quebec.
[Translation]
For example, there was the Tremblay Commission in the 1950s,
last century. There was former Prime Minister Pierre Elliott
Trudeau, who said in 1957 that there was no real basis for the
federal spending authority in the constitution.
There are also the interim report of the Quebec Liberal Party
special committee on the political and constitutional future of
Quebec society that came out in January of this year, the report
by the constitutional commission of Action démocratique du
Québec and the Séguin commission.
[English]
All of these groups are talking about the transfer of tax
points.
Outside of Quebec we see the same concerns being raised with an
ever clearer voice. For example, an eminent scholar, Thomas
Courchene, has recommended some form of tax point solution to the
fiscal imbalance that exists in Canada. The so called firewalls
group in Alberta has called for something of this nature.
The Canadian Alliance has been a consistent voice in favour of
using some form of tax point system that would ensure our economy
grows and that the health care needs of our aging population
would be met without going through the song, dance and chicanery
that went on when the government cut its own expenditures by a
mere 6%. At the same time as it cut transfers to the provinces
for health care and education, by I believe 20% to 25%, it also
tried to lay the blame for the lack of health care spending on
the provinces.
The tax point solution was also the policy of the former Reform
Party. It was an excellent policy and one that we can all stand
behind. I was involved in actually drafting the policy so I will
read it for the benefit of the House. It states:
The Reform Party supports the establishment of an agreement to
replace federal cash grants to the provinces with unconditional
transfers of the tax base of each province, adjusted for
differential provincial economic development so that the
provincial tax revenues collected in each province will grow in
parallel with the growth in the province's economy and
population. This will allow the content and particulars of
provincial policy to be set by provincial government clearly
accountable to the electorate of that province.
1135
Something needs to be said when the point is made about being
accountable to the electorate of a province. Sometimes it is
suggested that the federal government ought to impose national
standards because the federal government knows best what
Canadians care about and what is important to them. That means
we must accept that the voter who goes out and casts a vote in
the province of Ontario or Quebec is acting less responsibly and
has less of a social conscience at that moment than he or she
does when casting a ballot in the federal election. It infers
that somehow there is this schizophrenia in the Canadian voter,
that we are a hardhearted and uncaring people when we vote
provincially but when we vote federally, boy we sure do care.
That is obvious nonsense and the only way it gets through is
because there has been a really concerted effort on that side of
the House to maintain that fiction. There is a very powerful
vested interest in saying that the Liberals are the responsible
ones here, that they are the ones who dictate what is good, fair
and right in the country and that they protect our interests.
As I mentioned in my comments to the hon. member for
Winnipeg—Transcona, the record shows that the federal
government's performance in this area has been appalling. It has
been shameful, inconsistent and politically based. It has not
been based upon any kind of fairness or objectivity.
When other parties such as our own have come forward and
proposed ways in which it could be made fair, objective and
actually guarantee that health care and other national standards
would be maintained through an agreed upon, consensual process
that would be enforceable and would reflect the will of Canadian
voters, it has been rejected out of hand without any hearing
whatsoever. That is unfair and it should be changed.
The tax point solution proposed by the eminent authorities I
have cited and also by the Bloc Quebecois today is the best
solution. I encourage all members in the House to vote for it.
Mr. Bill Blaikie (Winnipeg—Transcona, NDP): Madam
Speaker, the member who just spoke was responding to something I
said earlier. I hope I have the time to take that up with him
because he makes a good point when he talks about how national
standards are enforced.
However, while I still might have the ear of the Leader of the
Opposition, it seems to me that there was a contradiction between
what the member just said and what the Leader of the Opposition
said in response to me when I asked him whether or not his party
was committed to maintaining the cash transfers. He said that
the Canadian Alliance was committed to it, committed to
legislating it into law and that the cash transfer could not be
unilaterally reduced.
Minutes later the hon. member got up and read from a Reform
Party policy resolution that he said he had something to do with,
which was the policy of the Reform Party and now the policy of
the Canadian Alliance. He has the resolution in front of him but
I do not. He may want to have another look at it as it talks
about the total conversion of all cash transfers to tax points.
Someone is not levelling with us here. Is it the policy of the
Canadian Alliance to convert all cash transfers to tax points?
That certainly is what the member just read into the record, as
the blues will show. If that is the policy then what was the
Leader of the Opposition doing telling me that it is the policy
of the Canadian Alliance to legislate the cash transfers? Is the
Canadian Alliance legislating against itself? Is it going to
legislate cash transfers so that when it forms the government it
cannot implement its own policy? What is going on here?
Mr. Scott Reid: Madam Speaker, I cannot find the
contradiction that the hon. member cites but I do point out that
part of what a government does is legislate so that it cannot act
in an irresponsible manner. That is why we have a constitution
in the country.
We make amendments to the constitution that are not amendable by
one government alone. Depending upon the amending formula, it
requires unanimity, seven provinces or 50% of the population. A
couple of other amending formulas for exceptional cases require
different levels of consent.
However the point is to legislate something that one cannot
change oneself. We did that with the Canada pension plan, as the
hon. member will know, so that the federal government could not
unilaterally change the rules under which Canadians enjoy the
potential benefits of that plan. It was an amending formula
which, at least on paper, was more strict than that of the seven
provinces or 50% formula in place under that plan.
1140
One does act in this manner. When we speak of creating binding
agreements with the provinces, the point is that we bind
ourselves and future governments so that they must act in a
consensual manner and they must find the support of those
provinces. This ensures that a government, which is almost
always elected by less than 50% of the population until we have
some kind of electoral reform, cannot act without seeking some
kind of broader consensus which actually reflects the will of the
majority of Canadians.
I do not see what the contradiction is in saying that we would
legislate to bind our own hands.
Mr. Bill Blaikie: The member should read the policy and
resolution into the record again and let the House judge.
Mr. Scott Reid: Madam Speaker, I invite the member to
check the record. We are not in favour of striking down the
CHST. We are in favour of transferring some of the value of cash
transfers to the provinces into tax points.
Mr. Bill Blaikie: It did not say some. It said all.
Mr. Scott Reid: It says cash grants. It does not say all
and it does not say some. My understanding is that if we can
find a way of getting the government to be more generous with
cash transfers we would be very happy about that. We will
encourage that when we get the opportunity to do so.
When we have the opportunity to ensure that some of those
transfers, and we do not know the percentage but whatever
percentage we can wrangle out of the government, could be put
into tax points to ensure that there would be a guaranteed
growing base for health care and education in the provinces over
time, we would favour that. When we see the way in which tax
points grow over time thereby ensuring—
The Acting Speaker (Ms. Bakopanos): Resuming debate, the
hon. member for Winnipeg—Transcona.
Mr. Bill Blaikie (Winnipeg—Transcona, NDP): Madam
Speaker, all I did was invite the hon. member to read into the
record one more time exactly what he read into the record a few
minutes ago.
On the face of it, if members were able to hear it, they would
see that it was in direct contradiction to what the Leader of the
Opposition told me in answer to a question that I asked him. The
member was so unwilling that he quickly disowned his own policy.
I could hear the cock crowing three times all the while that I
was asking the member to get up and read it into the record.
It is his own policy. Surely he is not ashamed of it. Surely
he would have been willing to read it into the record one more
time, except it would have become obvious at that point that we
get mixed messages from the Canadian Alliance on the question of
federal transfer payments.
Mr. Roy Bailey: You invented mixed messages.
Mr. Scott Reid: I guess it is not a mixed message to
favour—
The Acting Speaker (Ms. Bakopanos): Order, please. I
implore hon. members to give the same respect to the member as
was given to the other members today. There will be opportunity
during questions and comments to put questions to the hon.
member.
Mr. Bill Blaikie: Madam Speaker, when we hit on something
they start to yelp. We have hit on something that is a
continuing contradiction within the Canadian Alliance Party. Its
real policy is that it wants to get rid of cash transfers
altogether. It is right in the policy that the member read into
the House. It wants to transfer the tax points and return to
basically a kind of pre-World War II confederation.
The Leader of the Opposition spoke about the kind of Canada we
had before World War II and that it was only because of the war
the provinces transferred these tax points to the federal
government. It was a very clear indication that the policy of
the Alliance Party is to return to that pre-war situation.
Sometimes we get the feeling that it wants to return to pre-war
social policies as well, but that is another matter I will not
get into.
1145
I want to say to the hon. member, who is somewhat unhappy with
me at the moment, that I was actually intending to get up and
agree with something he said in his speech before he read that
policy into the record which so contradicted his own leader. He
made a good point about national standards and the fact that we
do not have a way of enforcing national standards that is not
open to the charge of being a political process or a political
judgment.
At the time of the debate around the social union, the NDP was
open, and said so in a public document, to the idea of
establishing national standards by mutual agreement between the
federal government and the provinces. We wanted some kind of
impartial mechanism for determining whether national standards
had been violated, somewhat along the lines of what the member
just spoke about. The difference is that we think the cash
transfers must be maintained and enhanced, and that the federal
government must bring them back to where they were and beyond. In
that way the government would not only have the mechanism for
enforcing it, which is to say withdrawing the cash transfers, but
it would have the moral authority to do so because it would be
playing its full role in the partnership that was established
earlier on with respect to various social programs.
The problem is not that the provinces do not have the tax
points. The problem is that the federal government is not living
up to its part of the bargain. If the federal government were
living up to its part of the bargain and maintaining the
partnership, there would be no cry on the part of the provinces
for tax points because they would be getting the kind of cash
that they should be getting. Instead, we do not have that
situation. In spite of all the hoopla last August about the
health accord, the federal government is still not putting into
health care and education what they were putting in prior to the
1995 budget. This is a fact that cannot be truthfully denied by
anyone.
If the federal government were willing to do that then we would
have a much different situation. I think we would still have the
Bloc and the Alliance calling for the conversion of cash grants
to tax points because that is their vision of Confederation. In
the case of the Alliance, it wants a more decentralized
Confederation. I am not sure whether the Bloc Quebecois is
thinking about Confederation or about Quebec, but it does want
more powers for Quebec and less ability on the part of the
federal government to enforce national standards because it
rejects the very notion of national standards.
Having said that, I think all members can see that the NDP
cannot support the Bloc motion, though we think a first
ministers' meeting to discuss this would be a good idea. It is
not the idea of the meeting that we are against. There is
probably good reason for having a meeting. First ministers would
probably like an opportunity and should have an opportunity to
make the case for the federal government to more fully live up to
the commitments it made years ago when it brought in medicare. At
that time medicare was to be a 50:50 partnership. Canadians
certainly do not have that today.
A good point was made by the Leader of the Opposition. He said
that the provinces have all these responsibilities while the
federal government has the tax points and is able to raise the
money. The federal government should be transferring that money
to the provinces to the extent that they need it to implement
programs brought in by the federal government. The solution in
our mind is for the federal government to do its job and do it
well. It must adequately fund medicare, post-secondary education
and social assistance through equalization. That is where the
solution lies from the point of view of the NDP. The solution
does not lie in giving up on the Canadian project, on national
standards and on national social programs. The solution is not
to allow the provinces to take over these programs as the
Alliance and the Bloc would like to see happen.
That is the NDP view. We agree with the portion of the motion
that calls for a meeting but because the motion prejudges the
outcome of the meeting we cannot agree with it nor support it.
If the motion proposed a meeting to discuss the problems with an
open mind as to how they might be solved, that would be a
different matter, but that is not the motion we have before us.
1150
The Leader of the Opposition said that the problem was lack of
trust in the federal government. I agree. Canadians, by and
large, although we could not tell from the way they voted, have a
lack of trust in the federal government. Regardless of the
political choices they make, they know when something is wrong.
They know the federal government is not putting the kind of money
into health care that it used to or there would not be these
problems.
I disagree with the Leader of the Opposition and his colleague
when they implied that Canadians have reason to trust their
provincial governments. The problem for a lot of Canadians is
that they are caught between a federal government that will not
adequately fund a one tier health care system and certain
provincial governments that are interested in introducing a two
tier health care system and a more privatized health care system.
They want to introduce the private sector into the health care
system even more than it is now.
Canadians face a dilemma. They must choose between a federal
government that wants to starve the one tier system to death and
provincial governments that want a two tier system. It is not a
happy choice for Canadians. A real choice would be to have a
federal government that wanted to properly fund the one tier
system so that there would be no pressure for a two tier system
and no province could complain that the federal government had
unilaterally withdrawn from the commitments it made in the past.
That would be the solution. I urge the Liberals to consider
whether someday they might live up to that ideal.
Mr. Rob Anders (Calgary West, Canadian Alliance): Madam
Speaker, does the member for Winnipeg—Transcona agree that the
Liberals should wait until after the summer before the House of
Commons votes on the MP compensation package so that MPs have a
chance to hear from their constituents before voting on a pay
increase?
Mr. Bill Blaikie: Madam Speaker, I do not want to assume
the role of the Chair in this, but it is obviously not relevant
to the debate before us. Perhaps the member should speak to his
own House leader who has been dealing with the issue on behalf of
the Alliance Party. He might then receive information as to how
members of his party collectively intend to deal with the issue,
unless there is no collectivity left in the Alliance Party, which
some days seems to be the case. If the member is interested in
reinforcing the impression that there is no collective mind left
in the Canadian Alliance, perhaps he could ask the question over
and over again.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Madam Speaker, I
have difficulty following the hon. member.
Is the hon. member telling us that the present situation with
the federal government contributing, for health for instance, 14
cents for a provincial investment of $1, is an acceptable
one?
Second, does he agree with the threats by the Liberals on their
share of the funding for health and education? Because that is
what cash transfers come down to. With them, the Liberals can
decide at any point when to cut off their funding, or when to
cut it, to slash it like they have since 1994.
Is that what the hon. member is telling us?
Does he not realize—however, it does take some intelligence to do
so—that most provinces, Quebec included, have said that they
would respect the Canada Health Act, with its five conditions,
and if ever tax points were transferred and a recalcitrant
province did not meet one of the five, there would be legal
proceedings by the federal government? There is no connection
with cash transfers, as opposed to tax point transfers. It is
simply a matter of proper administration of the Canada Health
Act.
Does he understand this, instead of using all his convoluted
analyses?
1155
[English]
Mr. Bill Blaikie: Madam Speaker, it is a gross
misrepresentation of the NDP position to suggest that somehow we
are happy with the status quo whereby the federal government
contributes so little on a percentage basis to overall spending
on health care.
I just finished saying, before the member rose, how unhappy we
were with the fact that the federal government was starving
medicare to death. I do not know whether the hon. member did not
hear me or did not understand me, but we are not happy with the
current situation.
However we think the solution is not to hand the ball over to
the provinces. The solution is to have the federal government
live up to its responsibilities. That would be a lot better from
our point of view.
Mr. Scott Reid (Lanark—Carleton, Canadian Alliance):
Madam Speaker, in his comments the hon. member for
Winnipeg—Transcona seems to put a great deal of faith in future
federal governments acting responsibly in the use of a spending
power they have not used responsibly in the past.
I am willing to accept that if the hon. member were to find
himself as prime minister in the future he would make transfers
for health care his top priority and would do whatever was
necessary. However I think he and I would both agree that it is
unlikely he will be prime minister in the future.
Based on a record in which the federal government has gone from
50 cent dollars down to 15 cent dollars before more cash was put
in, although we are certainly nowhere close to the 50 cent mark,
we have seen the federal government effectively renege on the
greater share of its health care funding.
Given that, I find it difficult to understand why he feels that
is the responsible route when we are concerned about health care
transfers. It seems we must find a way of binding the federal
government's hands and requiring that those transfers be made.
Tax points do that.
Perhaps there are other methods, but I do not see them being
proposed at the moment. This seems to be the best option
realistically available to us. It has the additional advantage
of putting more money into provincial hands as the needs of an
aging population grow and as the economies of those provinces
grow. There are some other advantages that go along with
encouraging prudent fiscal management in the provinces.
If we say that health care and national standards are the goal,
it seems to me we are better off ensuring an adequate and growing
source of funding than using any other means available to us. I
cannot see how we can get around that. I wonder if the hon.
member could enlighten me on this point.
Mr. Bill Blaikie: Madam Speaker, without wanting to be
too polemical about this, it seems that the hon. member once
again is very much at odds with what his leader said. He is
asking how else we can make the federal government live up to its
responsibilities unless we convert all the cash grants to tax
points. Yet the Leader of the Opposition said that as far as he
was concerned the solution was to legislate such that the federal
government could not reduce its cash transfer to the provinces.
That is one solution. Why did he not offer it? Why is he
fixated on converting cash grants to tax points when his own
leader is not?
With respect to the other question about why I should trust or
have great confidence in future federal governments, the point is
well taken. I do not have a lot of confidence in the present
government. This and previous federal governments have made a
whole lot of unilateral cutbacks in the federal commitment to
medicare and post-secondary education, going back to the budget
of Allan MacEachen and to the Conservative budgets. Almost every
federal budget, with the exception of recent ones which have put
back some of the money, unilaterally took out money from the
partnership that was established.
Why does the hon. member trust future provincial governments? I
am arguing on the basis of what I think the best system would be.
I do not have a lot of confidence in Mike Harris or Ralph Klein.
Maybe the hon. member does and that is the difference between us.
I am arguing for what I think the federal government should be.
I am arguing for what I think the role of the federal government
should be. My job as a politician is to try to make what I think
is the best thing happen, not always to make judgments on the
basis of how badly the Liberals are living up to what the federal
government should do.
1200
If I were to make judgments about what the federal government
should do on the basis of how Liberals behave, I would not think
that the federal government should have any role at all. However,
because I hold up a higher ideal in my mind of what the federal
government is than what Liberals are able to live up to, I
continue to argue for the kind of Canada that I want.
[Translation]
Mr. André Bachand (Richmond—Arthabaska, PC): Madam Speaker, I
would like to inform the Chair that I will be sharing my time
with the member for Kings—Hants, who will join us in a few
minutes, I am sure.
That said, it is my pleasure to speak to this motion by our Bloc
Quebecois colleagues, which we will of course support. We may
have a few problems with the way it is drafted, but I think
that, by talking on the subject, we will have the opportunity to
readjust, review and improve federal-provincial relations. It
can do no harm to hold a first ministers' conference. I think
this motion must be agreed to right off.
Every time there is an opposition day, and we look at the
subject proposed, questions come to mind. I do not want to
detract from the motion's credibility or its objectives, but we
always wonder what lies behind an opposition motion.
Is it current affairs, the problems of a given party, government
policy on a specific matter? Is it a more specific policy that
concerns Quebec? I do not want to detract from the good
intentions of our colleagues in the Bloc, whom we like very
much.
It perhaps has to do with the fact that our
colleague, Jean Charest, visited the rest of Canada—as they say
often—with ministers from the country's well off provinces to
present a sort of common front, to stand up to the
federal government on the issue of tax point transfers.
Madam Speaker, I will share a secret with you: it may be because
the Bloc Quebecois wants to help the Parti Quebecois by saying
“You know, we put forward a motion in the House of Commons and
Liberal members voted against the transfer of tax points”. At
the same time it wants to thwart Jean Charest's efforts.
As we know, a provincial election is looming in Quebec. There
may be a more partisan motivation vis-à-vis Quebec on the part of
the Bloc Quebecois. That being said, it takes nothing away from
the merit of the motion. What will happen to it later on is
everybody's guess, but I believe this to be its true purpose.
This is bad news if it is truly the reason behind this. We will
however support the motion and I hope a number of members and
parties will do likewise.
This being said, the transfer of tax points is an important
issue, but one must be very careful when talking about tax
points. It is connected to another issue, that of equalization.
One tax point transferred from the federal government to the
provinces, assuming it is worth $1 today and the province in
question enjoys significant economic growth, may be worth $1.05
or $1.25 one, two or three years down the line. A province's
economic vitality pushes the value of tax points upwards.
This is why the bigger and wealthier provinces of this country
want to have tax points transferred to them quickly because, in
spite of the inflation, economic growth would add value to them.
We must be careful. We live in a vast country where for the time
being—I repeat, for the time being—some provinces are less well
off than others.
We must therefore talk about equalization.
1205
If tax points are transferred, for example to Newfoundland,
these points will have less value in 18 months than the tax
points transferred to Quebec, Ontario or Alberta.
Therefore, we must have an equalization system that corrects
this situation. This is important. This principle must be the
basis for any federal-provincial discussion.
Even though the motion of the Bloc Quebecois cannot be amended
the way we would like to, we must keep in mind that we should
talk about equalization, to ensure that the have not provinces
do not feel left out in this reapportioning of tax points, this
reapportioning of existing and future wealth.
On the issue of equalization, I should point out that the
premiers from Atlantic Canada asked that the ceiling be removed
with respect to the calculation of royalties, as was done for
Alberta over 50 or 60 years ago. The idea is to give the
provinces a chance to keep the new wealth that they may have,
without being immediately penalized.
Of course, the current government said no. This is not
surprising, as we know, but it is unfortunate.
We say yes to a discussion on tax points and on transfers.
This is important. Why? Because it provides and stabilizes a tax
value for health, education, social services and so on, and it
also gives it a permanent character.
This must not be a strictly political decision on the part of
the central government.
We agree with that. But this should really be part of a
discussion with all Canadians, and the poorest provinces should
not be excluded in calculating how many tax points to transfer.
We are saying that equalization payments must also be
considered.
That having been said, we are telling the government not to be
afraid of talking with Quebecers, with the government of Quebec and
with the people of Ontario and Nova Scotia. It should not be
afraid of getting together with people from time to time. There
is no harm in doing so. The goal is not necessarily to come up
with a formal agreement overnight.
But why not have a much more permanent discussion mechanism?
Why not? Why not recognize the importance of our partners in
this country? Why is it always necessary to rattle the central
government's cage to get anything?
When the central government knows it is on the eve of an
election, it decides to transfer a little more money. But the
member for Saint-Hyacinthe—Bagot has put it very well, and has
done so for years now, when he says that there are hidden
billions.
When we look at the government's huge surpluses, the impression
one is left with, in the case of the health agreements reached
last September, is the same as if I were the federal government
and my little boy of five, whose name is Gabriel, had come to
ask me for money. What I would do is reach into my pocket,
pull out a handful of change, give it to him and tell him how
generous his father was.
That is what it is like. I got off easy, because he was happy
with the handful of change. But he did not know that my pockets
were full of money, because he got more than one pack of Pokémon
cards.
It seems like the provinces have to beg for pocket change
compared to the enormous surpluses hidden in various programs
and in the federal government's way of doing things.
Let us come to an agreement, talk about tax points and provide
the provinces with stable funding. Let us give them a chance to
plan ahead: equalization. Let us give poorer provinces a chance
not to be penalized through the transfer of tax points and
encourage them to put the money and energy needed for their
development, particularly with regard to natural resources off
the Atlantic coast.
We could be the world's largest oil and gas producer if we had a
vision and if we helped our partners, the provinces, often the
poorer ones and sometimes the richer ones.
We strongly support this motion, even though we know the federal
government will say that it has done an excellent job since 1993
and government members will vote against it. Nevertheless, the
Bloc's motion is important inasmuch as the provinces are asking
for a tax partnership.
1210
In closing, I will simply say that I invite members to look at
the spirit of the motion proposed by the Bloc Quebecois today
and to vote in favour of it. There is no obligation of result,
but the first result that could come out of this motion would be
for the federal government to accept, at a federal-provincial
conference, to discuss such an important issue as the transfer
of tax points.
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker, before
asking my question, let me clarify.
In 1994, the Bloc Quebecois talked about tax points as
protection against the terrible cuts the Minister of Finance
wanted to make to the Canada health and social transfer.
In 1995, Mrs. Marois, then Quebec's finance minister, asked:
That the federal government withdraw from social program funding
and that it transfer to Quebec the tax points used to pay for
that funding.
In 1997, Quebec's minister of intergovernmental affairs said
exactly the same thing:
Quebec will demand that its constitutional authority be
respected, will seek to fully exercise that authority, will
continue to denounce the federal government's interference, and
will call for full financial compensation in the form of tax
points.
Recently, even before Mr. Charest's tour through the rest of
Canada, Mr. Landry said that he would fight this battle, because
it made no sense that the health and education needs were in
Quebec but the money was in Ottawa.
With all due respect for the member for Richmond—Arthabaska, we
have been talking about tax points for a long time.
Since Mr. Charest agrees with this proposal, and because he
certainly still has very close ties with Mr. Charest, could the
hon. member not convince him to throw his support behind the
premier of Quebec, who is also calling for such a
federal-provincial conference, and who will continue to call for
the transfer of tax points in order to help right the fiscal
imbalance that has existed, particularly in the last three
years, between Quebec, the Canadian provinces and the federal
government?
Mr. André Bachand: Mr. Speaker, first, I want to assure my hon.
colleague that we do have great relations with our former
leader. I hope things will remain the same after he is elected
premier, maybe as soon as next year, who knows.
I do not think Mrs. Marois was finance minister in 1995, but it
is true that the Bloc has consistently ensured for several years
now, just like the government of Quebec, regardless of the
political party in office—to keep, as the member for
Saint-Hyacinthe—Bagot pointed out—some kind of protection for
Quebec and for Canada against the ups and downs of the sad
decisions made by Ottawa.
I will point out that the Mazankowski budget, for instance, was
the first step of the very tough budget approach. It was under
our government that the whole issue of transferring tax points
began.
Yes, it is important for all partners, government members and
opposition members alike, to join forces to fight the
government.
Having said that, let me remind my colleague from
Saint-Hyacinthe—Bagot that when Mr. Clark and I had the honour and
privilege to meet with the premier of Quebec, Mr. Landry told us
candidly that he did not think it was likely to happen. But we
do have to hang on to some kind of hope if we want our requests
to appear credible.
The transfer of tax points is obviously very important. As I
said earlier, equalization is also a major concern for Quebec.
It is all interrelated. I am sure my colleague would agree with
me.
[English]
Mr. Scott Brison (Kings—Hants, PC): Mr. Speaker, it is
with pleasure today that I rise to speak to the opposition day
motion brought to the House by the member for
Saint-Hyacinthe—Bagot. I share the hon. member's view that
federal-provincial co-operation needs to be expedited in the area
of tax point transfer.
We have a huge difficulty in Canada now with the reticence of
the federal government to engage in any meaningful co-operative
effort with the provinces. The PC Party has a strong history in
this regard, going back to our 1997 platform in which we proposed
a tax point transfer to the provinces to enable provinces to
better address some of the social investment needs.
The provinces are probably most capable of determining those
priorities as they are closest to the people affected by the
decisions.
1215
We need some sort of practical action to create a new system of
government that is much more responsive, more accountable and
ultimately more efficient. By giving provincial and regional
concerns a clearer voice, Canada can become a stronger country.
These practical changes can be achieved through
federal-provincial discussion and agreement without
constitutional amendments. That is important because I think
most Canadians want to avoid a constitutional dialogue at this
point. If we can achieve that through federal-provincial
discussions, which we can, then we should proceed.
This requires co-operative federalism, not brinkmanship, bravado
and disdain for the provinces, which have been the trademarks of
the government since 1993. The Liberal government has had a
paternalistic approach to the provinces. It is an Ottawa knows
best approach. Whether on health care, education or any social
spending, the government has attacked the provinces since 1993
with draconian cuts to transfers. These arbitrary and unilateral
cuts have created, for instance, a health care crisis in every
region of the country. The government has also slashed transfers
to the provinces while barely tinkering with its own spending in
terms of program spending.
The Liberal government had a choice to balance its books.
Instead of reducing federal program spending significantly, it
chose to maintain federal program spending but to cut the
transfers to the provinces such that the hard decisions
ultimately had to be made by the provinces.
The question is why the federal government slashed health care
transfers to the provinces while leaving its own departments
unscathed. The answer is because it could. It had the power to.
It was able to escape the accountability of explaining and
dealing with the impacts of those cuts because it had the power
to act unilaterally and arbitrarily.
This proposal of a tax point transfer to the provinces could go
a long way to ensure that federal governments do not have that
unfettered power to do again what this government did in the
early and mid-1990s by cutting the transfers to the provinces so
dramatically.
Again, the big problem here is that the federal government
currently has the power to trample over the provinces and escape
accountability for the consequences of these actions. Currently
the provinces have very little authority over their revenues, yet
they have all of the responsibilities for how the programs,
investments and spending programs will be administered. It is
like what Mark Twain once referred to as a bad job. We could say
that currently the provinces have a bad job: a lot of
responsibility but no authority.
The same federal government that created the health care and
post-secondary education crises across Canada by its cuts to the
provinces has tried to act like a knight in shining armour by
introducing, for instance, a millennium scholarship program to
directly fund students from the federal coffers. The government
is more interested in whose names are on the cheques than in the
long term interests of ordinary Canadians who want health care
and education systems they can depend on. Clearly some sort of
reform is necessary.
However, that is not exactly what the hon. member is calling for
with this motion. He is actually just calling for a first
ministers conference to discuss the possibility of a tax point
transfer. Clearly there is nothing wrong with having a
discussion of first ministers on an issue of this importance. I
would hope that members opposite and members of all parties would
see that in the interests of a constructive approach we should
all be supportive of the notion of a first ministers conference
to explore the possibility of this type of initiative. It makes
a lot of sense.
1220
Not only does this initiative make sense, but even those who may
disagree with the notion of a tax point transfer should at least
agree to the idea of having a discussion with the first ministers
of the provinces on this. We also need to broaden the nature of
this discussion to include equalization. Our equalization system
is currently broken. When we look at the history of
equalization, a cornerstone of Canadian public policy and the
only constitutionally enshrined spending program, we see that it
was introduced around 1958. At that time the stated goals of
equalization were to achieve approximately equal levels of
taxation and equal levels of services across Canada.
Clearly, particularly on the tax front, with some provinces like
Ontario and Alberta increasingly in positions to take fairly
aggressive tax reduction policies, we are seeing a ghettoization
of Canada in terms of the very important role of tax policy. Ten
years ago I do not think anyone recognized how important tax
policy could be in terms of creating levels of economic growth,
opportunity and ultimately prosperity for citizens within a
particular jurisdiction. However, today we have seen what has
happened in countries like Ireland, where an aggressive tax
strategy focused on capital taxes and corporate taxes has helped
achieve a 92% growth in GDP per capita over a 10 year period
during a period of time when Canada has had a 5% growth.
Enabling the provinces to have through equalization a little
more control over their natural resource wealth, for instance,
would go a long way in provinces like Nova Scotia and
Newfoundland toward actually enabling those provinces to reduce
taxes and to create greater levels of economic growth, not
specifically in resource areas but in new economy ventures et
cetera. Clearly we have to address the issue of the clawback of
resource revenues that impacts provinces like Nova Scotia and
Newfoundland in such a negative way.
We also have to address the issue, as my colleague from
Richmond—Arthabaska mentioned in his comments, of the caps on
equalization. We have 10 provinces with 10 premiers who have
agreed that now we should take the caps off the equalization
levels that go a long way toward denying individual provinces and
recipient provinces the opportunities and the ability to grasp
the economic levers they need to grasp, including tax policy and
social investment policy, in order to create some level of
sustainable economy and to ultimately be independent of
equalization.
In regard to the current equalization system's treatment of
recipient provinces, it is like how in certain jurisdictions
social welfare systems sometimes treat people worse if they get a
job. If they actually get a job they end up worse off than if
they stay on welfare. In some ways we have an equalization
system that has created a welfare trap, in that we actually treat
provinces that are starting to become successful and starting to
forge ahead worse than if they were not to pursue and embrace
economic opportunities in a way that we should be encouraging.
The former premier of Newfoundland, currently the Minister of
Industry and self-promotion, said in October:
I could not agree more with his comments then. Goodness knows
where he is on that today.
We need a consistent commitment from the government to enable
provinces, through equalization, through tax point transfers, to
achieve on behalf of their constituents prosperity and equality
in the 21st century.
1225
Mr. Tony Valeri (Stoney Creek, Lib.): Mr. Speaker, I
listened intently to my hon. colleague's comments. Earlier today
in the debate I made the comment that I do not suspect that there
is a lot of consensus or a consensus at all among provinces on
this issue with respect to the movement to tax points versus cash
transfers. I think it is fair to say. I know the hon. members
from the Atlantic provinces did.
Certainly analysis has shown that a conversion to tax points for
the smaller provinces would in fact be harmful given their
smaller tax base. I am trying to reconcile this in my mind. I
am trying to understand if the member, coming from the Atlantic
provinces and knowing that the Conservative Party is supportive
of eliminating cash transfers and going straight to tax points,
much like our colleagues from the Bloc, has had any dialogue at
all with his provincial premiers with respect to eliminating the
cash portion of the transfers and going to tax points completely.
As well, I am a little concerned about and am trying to
understand some of the inconsistency, perhaps, in the thinking on
tax points versus the equalization payments, where equalization
payments are a transfer of cash and there is a moving to tax
points on the straight transfers. There is a bit of
inconsistency in the thinking. I would like to hear from the
hon. member on that point.
Mr. Scott Brison: Mr. Speaker, I appreciate the hon.
member's intervention. This hon. member is not confused, but I
believe he may be.
In terms of the issue of tax point transfers, it is entirely
consistent with our party's position, going back to the 1997
election platform, that we should be enabling provinces to have
more say over their own tax policies and ultimately over spending
priorities through giving them an opportunity through tax points
to achieve that.
That being the case, he is quite right that without an
adjustment through equalization to ensure that there is some sort
of ameliorative impact from the equalization perspective, some
provinces would be worse off. That is why it is fundamentally
important to ensure that the equalization system, as I
articulated, takes that into account. One of the best ways to
achieve that would be to remove the equalization caps, which we
do have consensus on from 10 premiers across Canada.
There is another point. The hon. member from the Bloc Quebecois
who has proposed this opposition day motion is proposing that
there be a first ministers conference to debate and discuss this
issue. If the hon. Liberal member opposite is ingenuously
interested in hearing the views of Atlantic Canadian premiers,
then he should be supportive of this motion such that first
ministers would be able to get together and have this kind of
discussion.
The hon. member from the Bloc Quebecois is not saying in this
motion that he would want the transfers of the points. The
motion says that we want to have the discussion.
Certainly the hon. member's government should not be afraid of a
meaningful discussion, a first ministers conference on this
issue, which would give an opportunity to Atlantic Canadian
premiers, among others, to express their views and to negotiate
and achieve on behalf of their constituents what they are capable
of doing.
Mr. John Bryden (Ancaster—Dundas—Flamborough—Aldershot,
Lib.): Mr. Speaker, I just wonder what the member opposite
would think about the fact that Canada's public medical services
were financed originally by an earlier Liberal government,
basically with cash, and then a subsequent Conservative
government changed these cash transfers into tax points.
While that may work in most of the country, in the province of
Ontario we have the dilemma where a lot of the money that is now
going to the provincial government to finance health and social
care is basically not getting to this target because the
provincial government is spending less of its own money on health
care or is only using the money it receives federally. I wonder
what the member has to say about that.
1230
Mr. Scott Brison: Madam Speaker, the hon. member,
respectfully, is wrong. The fact is that the provincial
government in Ontario has increased its spending and investment
in health care disproportionately when compared with the federal
commitment to health care in Ontario.
There has been a sharp decline in the federal commitment to
health care in every province and the provinces have had to make
that up. In Ontario there has been a dramatic increase in the
provincial investment in health care to help compensate for the
draconian cuts by the federal government.
Unfortunately it is easier in some ways for a province like
Ontario to make up that money but in a province like Nova Scotia
with a weaker tax base it is very difficult. I would ask the
member to be cognizant and respectful of that.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker, first,
I want to say that I will be using my 20 minutes to give a
demonstration based on the motion we introduced this morning.
I would first like to reread the motion because, since the
beginning of this debate, we keep hearing things that have
nothing to do with the purpose of the motion. I thank my
colleague from Kings-Hants, who clarified the motion by the Bloc
Quebecois, to prevent the debate from going the way it seemed to
be going this morning. The motion reads as follows:
That, in the opinion of this House, the government should call a
federal-provincial first ministers' conference for the purpose of
reapportioning the tax base among the federal and provincial
governments through the transfer of tax points.
We are not saying that everything has to be turned upside down
and that the value of equalization has to be challenged. We are
not saying that the federal government's actions in its own
areas of jurisdiction should be questioned either. The only
thing we are saying, after four years of observation, is that it
is essential that a balance be struck somewhere.
We have now reached a point where, and this has been the case
for the last three years, there is too much money in Ottawa,
given this government's constitutional responsibilities, and not
enough in the provinces, including Quebec, given their
responsibilities, particularly for health, education and income
support.
There is too much money. We are not talking about peanuts. We
are not talking about a few billions, but rather several billion
dollars.
Since 1995 the Bloc Quebecois has gotten into the habit of
making its own forecasts regarding revenues and expenses,
therefore surpluses, especially the surpluses that have been
building up since 1997. We make forecasts because we do not
trust this government. Ever since he has been holding the
finance portfolio, the minister has been making forecasts that
are way off, sometimes by an incredible 130% to 400%.
How can we trust a government that does not even give us a true
picture of public finances, which would allow us to make the
right choices?
We came up with a rough forecast of surpluses over the next four
years—one must be very cautious regarding the last year because
four years is a long way away, even the third year is iffy. If
we use the same economic growth parameters as the major banking
institutions such as the SGF, the Caisse de dépôt et placement
du Québec, the Mouvement Desjardins, the CIBC, the Bank of Montréal
and the National Bank, and take into account not only the growth
parameters but also the analysis of the growth, we see that over
the next four years the Minister of Finance will have, thanks
to the taxpayers of Quebec and Canada, a budget surplus of
between $70 billion and $90 billion, plenty of room to manoeuvre.
We have hardly ever been wrong, maybe only by 5%. For his part,
the finance minister has been way off; since 1994, his forecasts
have been off by $60 billion. These are no small miscalculations.
Over the next four years the government will accumulate
surpluses of between $70 billion and $90 billion. Why such huge
surpluses?
First, people pay too much taxes; second, the federal
governments responsibilities are such that it cannot spend the
money entrusted to it by Quebec's and Canada's taxpayers; third,
if the surpluses are so huge it is because they have been
accumulated on the back of the provinces by drastically cutting,
gutting transfers since 1994. The provinces' needs keep on
increasing whereas here in Ottawa money has been pouring in,
especially over the past four years.
Since 1993 federal revenues have increased by 53%.
Revenues from taxes and income tax have increased by 53% since
1993, while federal spending dropped 3%.
1235
Let us have a look at the situation in Quebec. Program spending
in Quebec has increased by 16% during the same period, that is
since 1993. This means that the government of Quebec spends 13%
more for programs under its jurisdiction.
In health care alone, the increase was twice as high: the
government of Quebec's spending in health care has increased by
32%. Spending is increasing year after year, especially
because of the natural aging of the population. Needs increase
by 5% per year.
The federal government's spending has decreased by 3% since
1993. This is due to the fact that there were cuts to transfers
to provinces. The federal government has reduced the level of
its contribution to cost sharing programs, which had been set
during the 1960s and 1970s, especially in the areas of health
and education.
So much so that, for every dollar invested by the government of
Quebec, the federal government contributes only 14 cents.
However, these cost sharing programs were established on a 50:50
basis, the federal government contributing 50% of the costs and
the provinces the other 50%.
In the area of education, it is even worse. The Liberals should stop
misleading people by saying that there the federal government is
not backing out. For every dollar invested by the government of
Quebec in education, the federal government spends 8 cents.
In the past it has even been 50 cents for 50 cents.
Over the next four years, there will be huge surpluses, so
unbelievably huge as to be nearly surrealistic: between $70
billion and $90 billion in surplus for the next four years, and
that is the conservative scenario. I would again point out that
the Bloc Quebecois has never been wrong. The Minister of Finance
has, and far wrong at that.
What is the Minister of Finance doing with these surpluses?
First of all, the federal government is using these surpluses,
under section 91 of the constitution and subsequent
interpretation thereof, i.e. the power to spend, to intervene, or
not to intervene, in areas under its jurisdiction.
Let us take the example of employment insurance. Instead of
taking action, it makes cuts, while on the other hand, as the
surplus accumulated over the past four years, its intrusions in
areas of provincial jurisdiction, in particularly areas of Quebec
government jurisdiction, increased proportionally.
Let us take for example the 1997 budget, where the first
significant federal surplus appeared: $4.1 billion. The federal
government invested in new initiatives, in areas of provincial
jurisdiction, sums in excess of $2.3 billion. Out of a total of
$4 billion, $2.3 billion were invested in areas coming under
provincial jurisdiction. These include: the family, the child
tax credit, research, education and health, particularly via the
Canadian health information system.
Over half of the first year's surpluses were invested in
exclusively provincial jurisdictions. However, in that same
year, the Canada social transfer had not been restored to fund
health and education through the existing networks that were
well managed by Quebec and the other provinces.
In 1998, it was the same: a $10.8 billion surplus and $4 billion
in new initiatives in areas in which the federal government has
no business. In other words, it cuts on one side. It accumulates
surpluses year after year, at the expense of the provinces, the
unemployed and the poor.
The government then reinvests these surpluses through the back
door, in provincial jurisdictions that it has obviously
neglected if we look at the general transfers to fund health and
education, among others. This is the tactic used by the federal
government.
It was the same thing with the budget for the year 2000. The government
will have between $15 billion and $19 billion in surpluses. The
minister's forecasts called for less than half of that. The
minister has lost all credibility in that respect. In any case,
no one still believes him.
In the year 2000, close to $8 billion was spent on new
initiatives and renewed initiatives from 1997, in particular, in
jurisdictions that come exclusively under Quebec and the other
provinces.
1240
Is it normal that, on the one hand, the federal government goes
after the provinces and has them bearing the brunt of all the
cuts made since 1994 in health care and education when the
needs of the provinces in both these areas are increasing? I
want to remind the House that federal transfers for education
have never been lower in the last 30 years. The government is
cutting and not meeting the needs of the public.
On the other hand, it keeps infringing upon areas of exclusive
provincial jurisdiction recognized in the Constitution of Canada
and in many court rulings.
It is not normal to have the federal government juggling with a
surplus while the provinces and Quebec are overburdened by heavy
responsibilities.
We need to rebalance the tax base. This is such a matter of
urgency that the government of Quebec and the premier of Quebec,
Mr. Landry, have decided to set up, the Séguin
commission, chaired by a Liberal who is a former Quebec minister
of finance, to examine how great the imbalance is and how to
correct it.
We are constantly in crisis.
We cannot have a situation where the needs of the people are
constantly growing while the federal government has huge
surpluses and avoids debating the issue, because we know that the
Minister of Finance, as astute as he is and with the lack of
transparency he has shown, is predicting surpluses that have no
basis in reality.
All the money that is not included in the budget and that
magically appears at the end of the fiscal year, as we have seen
since 1997, goes directly to debt reduction pursuant to the
decision made in that regard. There is no debate. The government
also avoids debating with the provincial governments, including
the Quebec government, the fact that the needs are with the
people but the surpluses are here, in this House.
This is not normal. For decades, successive governments and
successive premiers in Quebec have fought every time an imbalance
became apparent. It happened under Maurice Duplessis, as well as
under Lesage, Bertrand and Johnson.
Mr. Bourassa said that the worst threat facing the government of
Quebec was fiscal imbalance and a situation where the federal
government continually, through its spending power, interfered in
areas under the jurisdiction of Quebec and the other provinces,
thereby preventing a consistent approach to public affairs
management in areas which, under the Canadian constitution, are
recognized as being the responsibility of the provinces,
including Quebec.
Undoubtedly, the federal government has a problem. However, the
provincial governments have more serious problems, because they
have to meet the needs of the population.
We must limit the federal spending power. What is happening now
was foreseeable. Since 1997, when the possibility of huge
surpluses appeared for the first time, we have been saying that
this would happen. Those who do not believe me can refer to
Hansard; our speeches were mostly on this issue.
The federal government will accumulate surpluses on the back of
everybody: the unemployed, the sick people and the provinces.
As soon as it has done so, as soon as the first surpluses
appear, it will revert to its old bad habits, intrude into
provincial jurisdictions and multiply federal initiatives in
these areas just to stick the Canadian flag everywhere and to
say that it is a good government, working in the best interests
of the population.
How hypocritical to have cut programs of such basic necessity as
education, health and income support, to have made the
government of Quebec and Canadian provinces bear the brunt of it
and then to have come in as a saviour by taking several
initiatives in these areas through the back door.
This is why we have brought forward this motion, asking the
government to reapportion the tax base by calling a
federal-provincial conference.
1245
In the last 50 years, there have been two important conferences.
One of them took place in 1964, in Quebec City. Mr. Pearson was
the Prime Minister of Canada, and Mr. Lesage was the premier of
Quebec. Mr. Pearson was an intelligent man.
He was able to understand that the requirements of the provinces
and of Quebec had to be met, if we were to have a better balance
in this country.
He did realize that, for the war effort, the federal government
had borrowed the personnal income tax base of the provinces,
but that after the war it was necessary to reapportion the tax
base because of the constitutional responsibilities of the
provinces. They had to regain the tax base they needed to
finance these responsibilities. He realized that.
In 1977, during the second important conference, once again, the
federal government realized what the situation was and
transferred tax points.
Why is this federal government so dense? Why is it so obtuse
that it cannot see the obvious? Things cannot go on like this
for years. We cannot have the money in one place and the needs
elsewhere. A reapportionment is in order.
The easy way is to use tax points, since this tax base can be
easily reapportioned, by taking into account the needs of the
provinces without denying the role of the federal government.
Some members talked about equalization earlier. Certainly, when
tax points are given to provinces such as the maritime
provinces, there will be a problem at some point. These
provinces have by definition some difficulty in getting from
their taxpayers the taxes that would allow them to maintain
services of the same quality as those provided elsewhere in
Canada.
But there is equalization. We are not asking the federal
government to transfer everything. We are asking that a new
balance be struck. Might it not be open-minded at some point,
instead of constantly saying no? We are used to no.
When it comes to Quebec, the federal government has always
behaved as if it were a unitary state. It said no to Quebecers'
democratic rights with Bill C-20. Everyone remembers that there
was a reference to the supreme court. With Bill C-20, the
government said no to Quebecers' democratic rights.
It said no to parental leave, for instance. It said we would
have a program coast to coast. It is not nearly as good as the
Quebec government's program, but that does not matter because
it is the parents in Quebec who will pay at the end of the
day. It said no to Quebec's program.
It is also saying no to young offenders, as we saw recently. The
Minister of Intergovernmental Affairs, carrying indecency to a
new high, beyond anything he had done up till now, went as far as
to tell us that the consensus that we presented here, that my
hon. colleague for Berthier—Montcalm presented, was a fabricated
consensus because we had infiltrated all the organizations that
supported us in our approach. We would then follow that we have
infiltrated the Quebec Liberal Party. Such nonsense is quite
incredible.
It is saying no again, because the transfer of tax points is
another idea from Quebec. Sometimes we wonder if this government
is not in the process of changing Canada into some unitary state,
where differences are not tolerated. Forget about Quebec's
specificity. We have almost become an internal colony. Before we
were a colony ruled by metropolitan Britain. Now we have become a
colony within Canada. We are told “No, Ottawa knows best. Ottawa
knows everything. Ottawa knows what is good for Quebec”.
I hope we will find more open-mindedness on the part of the
Liberals toward our proposal for a federal-provincial first
ministers' conference for the purpose of redefining the tax base,
of reapportioning that tax base. The current situation is
unbearable.
Quebec is not alone. The government can say no to Quebec, in its
colonial spirit, and seek to have a wall-to-wall policy across
Canada, even while recognizing that sometimes Quebec's policy is
better than the federal policy. We demonstrated it with respect
to the Young Offenders Act. It can treat us that way if it wants,
but a consensus is in the making across Canada.
It is not only Quebec. Members
were speaking earlier of a national policy. We have a national
government in Quebec City which is forming a consensus with the
provinces to readjust the tax base.
1250
In the case of the poorest provinces, it is very simple. There
are equalization payments. We are not calling for them to be
scrapped. We simply want, when we speak of the federal
government's withdrawal and of redefining the tax base, the
federal government to withdraw first from everything that
concerns Quebec's and the provinces' jurisdiction—that would be
the minimum—and to transfer the equivalent taxing power to the
provinces. That could be discussed at a first ministers'
conference.
I hear the Minister for International Trade bleating. If he
stood up instead of being a wishy-washy member from Quebec, he
would join the consensus. For once, if he stood up like a real
Quebecer, he would defend Quebec's point of view.
I hope my colleagues in the House of Commons will vote in
support of this motion.
Mr. Antoine Dubé (Lévis-et-Chutes-de-la-Chaudière, BQ): Mr.
Speaker, if the Minister for International Trade could go back to
his seat and ask a question, I would not have to put questions to
my colleague, the hon. member for Saint-Hyacinthe—Bagot.
I will first make a few comments. I would like to congratulate
the member for Saint-Hyacinthe—Bagot, in particular for his
demonstration. With the means available to him, which are far
from what the government has at its disposal, he has always
succeeded in forecasting as precisely as possible, more precisely
than the Minister of Finance in any case, the size of the
surplus. I think he deserves a special tribute for this. He was
always very close to the actual figures, even though he did not
have access to the same tools as the federal officials.
I am very proud of his support for the motion I brought forward.
The members of the Bloc Quebecois have all worked together to
bring this important motion forward.
Does the member for Saint-Hyacinthe—Bagot agree with the
expression commission on fiscal
strangulation used by the Parti Quebecois government? Does he
consider this expression exaggerated or adequate? I would like to hear
his comments on this point.
Mr. Yvan Loubier: Mr. Speaker, it
is no great feat to have forecast reality, because we have come
pretty close to the right figure by using known and public
figures, even those of the Minister of Finance.
If he has not done the same, then, it is because he has done a
poor job, either out of incompetence or lack of transparency, or
because he was trying to be astute, as I said earlier. He likes
not forecasting a surplus; then he can decide on his own what to
do with the money.
The expression fiscal strangulation is no exaggeration. We find
ourselves in a situation—no joke here—in which the federal
government's financial situation is going to be really
flourishing. We are talking of $70 billion minimum over four
years.
Those who find this an exaggeration have always said the same
thing when we presented our estimates “It's an exaggeration, it
makes no sense”. Yet we have always been dead on. There is,
therefore, no exaggeration here and we have consulted many
experts. We did not consult certain economists, not the friends
of the Minister of Finance; we consulted all forecasting
organizations. We were objective.
We are talking about fiscal strangulation in connection with
needs. For instance, health needs are increasing in the
provinces. In Quebec alone there will be a 5% rise. We are
talking billions of dollars. The billions of dollars of surplus
will pile up in the federal coffers while the health needs in
Quebec and in the provinces will be very great.
These needs must be met; they are the needs of the population.
Yes, there is fiscal strangulation going on. The present
situation is a dramatic one.
There has been an increase in initiatives in areas of
jurisdiction that belong to Quebec, such as health and education,
which do not take into account the needs of the public and the
government of Quebec's policy in these two sectors in particular,
where it spends more than the federal government. We are talking
about $1 for every 14 cents in the health sector, and $1 for
every 8 cents in the education sector.
The federal government is meddling in other areas, which have
not been identified as fundamental needs by the government of
Quebec. What does this mean? It means that the federal
government is not making good use of our money. There are no two
ways about it. So how are we to reconcile these two visions,
Canada's and Quebec's? We are making an attempt. We are
introducing a motion which says “Sit down with the premiers of
Quebec and the provinces. Talk about rebalancing fiscal
resources, but on the basis of the real numbers. Let us have no
more of the Minister of Finance's nonsense, with estimates that
are off by 140% to 400%. We want the real numbers”.
1255
Everyone has the real numbers now anyway, because everyone is
capable of taking a calculator, as I did with some of my
colleagues, and doing the math. Even with the worst scenarios,
the surplus will grow to $70 billion over the next four years.
This money does not belong to the Minister of Finance, nor does
it belong to the member for Saint-Maurice. It belongs to
taxpayers, whose needs are in areas such as health, education,
income security and so forth, areas which should reflect the
public's interest, not the leadership aspirations of the Minister
of Finance.
Mr. Gilles-A. Perron (Rivière-des-Mille-Îles, BQ): Mr.
Speaker, I would like to make a comment that may be somewhat off
topic.
I find it quite deplorable that the member for
Papineau—Saint-Denis would be screaming from behind the curtains
and does not even have the courage to take his place and ask
questions.
I would like to congratulate my colleague from
Saint-Hyacinthe—Bagot for his speech and I would like to hear
what he has to say about the money the federal government owes
Quebec.
Mr. Yvan Loubier: Mr. Speaker, my colleague from
Rivière-des-Mille-Îles has put his finger on a thorny issue.
I believe the federal government owes over $3.2 billion to the
Quebec government and, despite repeated requests, it steadfastly
refuses to pay up. These outstanding bills are documented. Every
one of them is well documented and together they total $3.2
billion, which the federal government refuses to acknowledge it
owes.
At issue is, for example, $1.9 billion in compensation for the
GST. A few years ago Quebec harmonized its provincial sales tax,
the TVQ, with the GST. It has been losing money ever since. The
federal government never told us it would one day compensate the
maritime provinces for doing exactly the same. Three maritime
provinces got $900 million for harmonizing their taxes.
We are asking the federal government for $1.9 billion because
harmonization has cost us dearly. We were the first ones to do
it, on our own initiative, because we wanted the tax system to
work well.
Is there any way that someday Quebec's demands will be met?
The same is true of the Canada assistance plan. The Quebec
government is suing the federal government for $310 million owed
to it by the federal government.
The Quebec government is asking the federal government for $96
million to administer the Young Offenders Act. I am not talking
about the new harsh, barbaric act beneath the dignity of this
parliament, but rather about the old act under its jurisdiction.
These needs are not being met.
It is incredible; the Minister of Finance has billions of
dollars, he even boasts about the surplus, and he lets the needy
remain exactly that, needy. He lets sick people wait in
hospitals. He invests elsewhere. For example, as far as health is
concerned, he invests through the real transfer to the Quebec
government, but he does nothing for the fundamental needs of the
sick people.
He makes students wait. A student is not a student forever. At
one point in his life he has needs that must be met quickly. This
is incredible. The funding of education, through the CHST for
post-secondary education, has never been this low in 30 years.
The minister continues to brag about the surpluses. He is
being astute by not making forecasts that reflect the real
surpluses. He is avoiding debate and paying down the debt.
Could he not give a bit more to the people, dish out the dough
as they say? Let him spend on the people in order to meet the
real needs, and let him pay his bills and his debts. The federal
debt is not the only one the minister has to deal with. He has a
debt toward the Quebec government because we have taken measures
that were warranted from a practical point of view. For example,
there is the harmonization of the GST and the QST and the issue
of young offenders. I think there is a lack of will on the part
of the government. This government is ignoring Quebec
completely, it just does not care about Quebec.
1300
Ms. Diane Bourgeois (Terrebonne—Blainville, BQ): Mr.
Speaker, just like my colleague from Saint-Hyacinthe—Bagot, I
regret that Quebec and the other provinces have to bear such a
heavy tax burden.
According to my colleague what group of people
is hardest hit by this tax burden? How are they affected? Can he
give us some brief examples?
Mr. Yvan Loubier: Mr. Speaker, there is no doubt in my mind
that the bad policies of the federal government have hurt two
main groups, women and young people.
Employment insurance policies have affected and continue to
affect women and young people, who make up 60% of all those
ineligible for EI benefits.
It is also true that the Minister of Finance has recently cut
taxes, but mainly for the rich. Single parent families, often
headed by women, will go empty-handed this year, next year and
the year after.
It is obvious. These two examples show that women are paying the
price and will continue to pay the price. I want to thank my
colleague for her question.
[English]
Hon. Jim Peterson (Secretary of State (International
Financial Institutions), Lib.): Mr. Speaker, what we have in
the House today is a motion by the Bloc to transfer tax points
from the federal government to the provinces. This is not
complicated. It means the Bloc simply wants us to give up our
power to raise revenue to the provinces. It wants us to give up
our power to do the things which are absolutely critical to our
country as a nation affecting every province and every person
regardless of where they live, not just in particular
provinces.
The Bloc wants us to reduce our capacity to make transfers to
individuals. Our biggest single expenditure to individuals is
over $25 billion a year to Canada's seniors. How much of that
does it want us to give up? It wants us to give up our capacity
to cut taxes.
We have just introduced the biggest tax cuts in Canadian
history, $100 billion over five years. We have seen the benefits
of that. Those cuts started January 1. Canada's growth rate in
the final quarter of last year was 1.9%. In the first quarter of
this year the latest figures show that our growth rate has gone
up to 2.5% in spite of the serious downturn in the U.S. economy
and one that was threatening us and one that members opposite
were saying that we had to do something about, that we had to
bring in new budgets because things were not working.
That stimulus presented by the Minister of Finance just when it
was needed has ensured that we have not gone into a tailspin, but
have been able to cope with that downturn.
The Bloc wants us to give up our capacity to pay down the
federal debt in order for the provinces to pay down more of their
debt. Paying down debt is good for all of us but the fact is
that the federal debt is more than twice that of the provinces.
We have made enormous strides in paying it down. When we took
office it was 71% of GDP. It is now below 54% of GDP and heading
to less than 40% of GDP within five years.
As members know, last year the finance minister paid off $15
billion in Canadian debt. This is important because this payoff
is saving us about $2 billion a year in interest.
The provinces should maybe pay down their debt too but their
debt cumulatively is less than half of what ours is.
We pay about 25 cents out of every tax dollar to service the
federal debt. The provinces pay about 12 cents. In terms of
fairness, where should that capacity to pay down the debt go
first?
1305
When we look at the credit ratings that we get as a country and
the lower interest rates that the bond rating agencies give us,
it is because we have been able to balance our budgets for the
past three years, reduce our taxes and pay down the debt. Those
reduced interest rates constitute an enormous savings not only to
the federal government but to every one of the provinces.
The Bloc members want us to give up to the provinces our
capacity to make strategic investments for the future of
Canadians, strategic investments in areas such as education,
which is so critical to the economy of the 21st century and to
the new economy, and to give up our capacity to support
innovation such as through technology partnerships. All these
programs are critical to the future economic well-being of
Canadians. We are not going to do it.
We have seen an historic accord concluded last September by the
Prime Minister of Canada with all of the provincial ministers. It
was historic, first, for the amount that was involved, $21.1
billion over five years added to the transfers that we are
already making to the provinces. In addition, another $2.2
billion for early childhood development.
What are the overall transfers that we are making as a federal
government to the provinces? They are at an historic high. When
we look at the CHST, including the tax points, and at
equalization, which is at an all time high, it is over $40
billion a year that is transferred to the provinces.
Let us go back historically and take a look at how this whole
issue of tax transfers appeared on the agenda. It started in
1977 when the provinces said that they needed more room to tax.
The federal government said that it would give them more room but
that they had to recognize that those transfers of tax points to
the provinces would be transfers of revenue generating capacity.
The federal government gave up its capacity to tax by 13.5% on
the personal side and 1% on the corporate side. The provinces
picked that up by imposing those taxes. They got the cash and we
did not. It was a transfer of cash to the provinces.
Ever since then the provinces have said that the federal
government was not transferring to them anything more than the
cash component. How could they be so short-sighted? How could
they go back on their word which they gave in 1977? How could
they go back on their commitment to recognize that the tax points
they took from us were in fact transfers to those provinces?
[Translation]
The net impact of tax points on taxpayers was zero, but it cost
the government a lot of money.
In 1997, the value of tax points transferred to the provinces
was $2.7 billion. That amount has been increased and is now at
$16 billion, which is about half the total amount provided to
provinces under the CHST.
[English]
What are our reasons for not going back on what we have done?
First, doing tax points creates inequities among the richest and
the poorest provinces. A tax point in Ontario is worth $35 per
capita today. It was worth only $17 last year in Newfoundland.
Is that the type of equity that we are trying to build for all
Canadians?
On the other hand, when we transfer cash to the provinces it
means the same amount per capita. That is equitable.
1310
The second reason we will not go back on this is that we will
not give up the federal capacity to legislate the values which
are so critical to Canadians, such as the Canada Health Act. This
is why we have used the threat of cutting transfers to the
provinces, and have actually had to cut in certain cases in order
to ensure that the principles of the Canada Health Act were
adhered to by the provinces. If all that cash were gone, total
leverage would be gone and our admired system of public health in
Canada would be finished.
In terms of social assistance, we used it to enforce the fact
that provinces could not impose minimal residency requirements.
That was fair. If one is a Canadian it does not matter which
province one lives in, one's rights will not be cut off. That is
what it means to be a Canadian.
We can look at our relative capacity to tax already. In 1977,
before the transfer of tax points to the provinces, personal and
corporate income taxes brought in about 60 cents for every dollar
of federal tax. Today that is up to about 85 cents. When we add
federal transfers to that revenue generating capacity in the
provinces, the provinces end up with a higher revenue base than
in the federal government.
We need the fiscal tools to be strong. Nothing could have
demonstrated that better than the Canadian economic miracle of
going from a deficit of $41 billion to three straight surpluses,
heading to four, and having been called by the economists of
London the economic miracle of the west.
The Bloc members, the opposition, have consistently denied the
value of the tax points. They say that we give only 15 cents on
the dollar to health care. They also ask us to give them more
tax points. If tax points are so valuable, why did they ignore
the tax points when they said we gave only 15 cents on the dollar
for health care? It is over 30 cents. They cannot have it both
ways.
[Translation]
That is hypocrisy. Twenty-six per cent of federal funding for
research and development goes to Quebec. What percentage of the
Canadian population does Quebec account for? Twenty-five per
cent.
For industrial research and development, the government spends
33%; for the Canadian Institutes of Health Research, 32%; for
infrastructure, 26%; for the Canada Foundation for Innovation as
well as for 29 research chairs, 30% of the budget. For the CHST,
50%.
Now we can see why the Bloc Quebecois is proposing this motion.
It is obvious. It does not want a federal government, a Canadian
government. It wants to destroy Canada. That is their sole
objective and that is the reason why a few weeks ago, here in
the House, members of the Bloc Quebecois insisted that we switch
to a North American dollar. They want to destroy Canada's ability
to have an independent monetary policy. The sole motivation of
the Bloc Quebecois is to destroy Canada, not to promote it. That,
we will never accept.
[English]
Mr. Jason Kenney (Calgary Southeast, Canadian Alliance):
Mr. Speaker, I would like to congratulate the minister on coming
back to join us here in the House and on his very successful
recovery. We all had him in mind.
1315
The minister managed to work himself up into quite a frenzy over
a proposal to continue with the status quo. He spoke as though
the transfer of tax points between senior levels of government
would somehow undermine the federation and the very glue that
bonds it together.
Will the minister not admit that tax point transfers from the
federal to provincial governments to allow them to finance
programs more transparently within their own exclusive
constitutional jurisdiction is a longstanding historic practice
of the Canadian federation?
When he does admit this, why is he concerned about the motion
which simply suggests that the first ministers gather for the
purpose of reapportioning the tax base among the federal and
provincial governments through the transfer of tax points? Is this
not an ongoing process? Does this not happen from year to year?
Is the negotiation of who finances what not a work in process in
terms of tax points and cash transfers? If so, why is he so
concerned?
Hon. Jim Peterson: Mr. Speaker, I thank the hon. member
for his very generous words toward me. I can assure him and all
hon. members that my thoughts are with them too.
Is he proposing that the meeting of first ministers for the
purpose of reapportioning a tax base among the federal and
provincial governments through the transfer of tax points would
involve the transfer of tax points from the provinces to the
federal government?
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker, I
would also like to welcome the member and wish him a speedy
recovery.
However, I have to say that I am very disappointed with his
diatribe. Each time we put sensible projects forward, we are told
we want to destroy Canada. They do not need us to do that. They
are destroying the country themselves by being as narrow-minded
as they are, and by not even accepting the idea of a
federal-provincial meeting. Really! A federalist is opposed to a
meeting between his prime minister and the provincial premiers to
talk about the efficient operation of the federation. This is
really unbelievable.
They talk about the elimination of the deficit as if it were a
miracle. Well if all miracles came about that way, we would never
have seen one on the face of this earth. It is easy to have
somebody else do the dirty work and then say it is a miracle. He
did not see how the budget was balanced, that is for sure because
it was done somewhere else, not here. It is the unemployed who
did it, as well as the provinces. But I do agree, it is a
miracle.
Could we strike some sort of a balance somewhere? It is not only
the public finances that need to be balanced. Could he show a
little more balance and admit that it would be a good idea, given
anticipated surpluses of between $70 billion and $90 billion in
the next four years, to talk about reapportioning the tax base?
Hon. Jim Peterson: Mr. Speaker, I thank the hon. member for
his kind words.
He said that the federal government does not want to meet with
the provinces to discuss fiscal arrangements. If my memory serves
me right, the Prime Minister and all the premiers had a meeting
on September 11, last year. Under their historical agreement, the
federal government transferred more than $23 billion to the
provinces.
Is this the kind of Canadian co-operation the hon. member
dislikes? Does he not want to have this type of co-operation
between the federal government and the provinces?
If he wants to talk about problems, let me tell him quite
frankly that since separatism became a force to reckon with in
Quebec, we have seen a great deal of change.
1320
I was living in Montreal in 1970. In those days, Montreal was
the very best city in Canada and in North America. But since we
have separatism in Quebec, it is a challenge to get investments
and create jobs. I would like to see the day when Montreal will
regain its past glory. All Canadians will work together so that
this happens one day, with Quebec being part of Canada.
Ms. Diane Bourgeois (Terrebonne—Blainville, BQ): Mr.
Speaker, I have a question. The hon. member talked about nothing
but powers throughout his speech. From the moment he stood up, he
talked about powers.
I never felt any compassion whatsoever from the hon. member for
the 1.3 million children living in poverty in Canada. I did not
hear the hon. member say anything about the problem facing the
families. He did not mention the fact that single mothers need
social services, health care and education services.
There is also the fact that the federal government completely
withdrew from social housing in 1994. It does not invest one cent
in social housing anymore.
Does the hon. member opposite not think that it is high time to
stop squabbling over powers and talking about separatism all the
time, and to start thinking about the real people who need the
money?
Hon. Jim Peterson: Mr. Speaker, I congratulate the member for
that question because, on this side, we agree totally with her
ideas.
Some hon. members: Oh, oh.
Hon. Jim Peterson: Let me say one thing. As far as children
and working families are concerned, our investment in child
benefits, which will reach nearly $9 billion annually, is one of
the most considerable ever made for children and low-income
working families.
What we have done for education is very important for the future
of all our youth. Even when there was a deficit we invested in
post-secondary education. We had a budget for education and
invested enormously through various programs: chairs of
excellence, Canadian scholarships, millennium scholarships and
tax credits for students.
We have given enormous amounts to that sector and Canadian
universities have thanked us for all we did in the area of
education because education might just be the most important
thing for the economic future of our country and for individual
opportunities offered to each and every Canadian.
Mr. Réal Ménard (Hochelaga—Maisonneuve, BQ): Mr. Speaker,
with your permission, I would like to ask for the consent of the
House to share my time with the member for
Charlesbourg—Jacques-Cartier. In any case, I think it is in
accordance with the standing orders.
It really takes quite a lot of nerve for government members to
rise here in the House and tell us that everything is perfectly
fine and to refuse to see a reality that the member for
Saint-Hyacinthe—Bagot is not the only one to observe.
1325
All the premiers, regardless of their allegiance, whether they
represented a Progressive Conservative, New Democrat or Liberal
government, including the former premier of Newfoundland and now
Minister of Industry, came to the same conclusion as that of the
Bloc Quebecois today. This conclusion is that, in the Canadian
federal system, there is an incredible distortion between the
pressure under which the provinces are to provide services to
their citizens in vital areas such as education, health and
social services, and the situation of the federal government,
which accumulates surpluses and is involved in areas where the
pressure is much less.
A number of experts have mentioned the paradox whereby this
government got rich partly because of free trade, while it was
opposed to free trade. Beyond the economic policies that it has
chosen, this government has had recurrent influxes of money, only
because a free trade agreement was signed.
This government was opposed to free trade. It had pledged to
abolish the GST. The whole thing became so ridiculous that
anglophones say that GST stands for “give Sheila time”. It became
a well known fact that this government did not feel bound by its
commitments.
The motion put forward by the hon. member for
Lévis-et-Chutes-de-la-Chaudière is asking that, through existing
mechanisms, a first ministers' conference be called to decide on
the type of fiscal rebalancing that should be considered to
ensure the kind of balance that is so important in a federation.
When I was a university student I learned—and I am sure I am
not the only one who did—that federalism is characterized by the
coexistence of two levels of government in a state of balance. If
this is the case, then we must call this conference, because we
desperately need to correct the existing imbalance.
Here are some figures which I find very meaningful. Between 1993
and 2001, federal government revenues increased by 53%. During
that period, its expenditures went down by 3%.
If its spending were reduced, one does not need a doctorate in
economy to understand that it made cuts and offloaded a number of
responsibilities, or that the pressure to provide services is not
on this government, but on the provincial governments.
In the meantime, during the same period—no one can say that our
numbers are not precise—from 1993 to 2001, program spending in
Quebec, when considering all the programs administered by the
Quebec government, increased by 16%. It increased by 32% in
health care alone.
I would like members to remember that a year ago all the
health ministers asked their public service—so it is not the
member for Saint-Hyacinthe—Bagot or the member for
Hochelaga—Maisonneuve or the member for Lévis—the public
service of each province was asked by its health minister to see
what kind of pressure will be put on the different health
departments throughout the country in the coming years.
This led to a study that I have here witch says that for the
next several years, not two or three years, but 15 years if the
provinces want to provide exactly the same services every year,
if all Quebecers who received health services last year expect to
receive exactly the same services, the budget of Quebec's health
minister will have to increase by 5%.
Mr. Yvan Loubier: Every year.
Mr. Réal Ménard: The hon. member for Saint-Hyacinthe—Bagot
understands me well when he whispers to me that it is per year.
That means that we will not come to the end of the tunnel if the
status quo in the fiscal imbalance between the provinces and the
federal government persists.
1330
The 5% is attributable to the aging population, to the
acquisition cost of medical technologies. For a hospital,
acquiring a scanner may cost millions of dollars and that is only
for a single hospital and one piece of medical equipment.
Do members know what item is currently the most costly in hospital
budgets? It is the increased spending on drugs. That expense
cannot be cut down, so over the next few years there will be
significant increases.
Let us acknowledge something. Has there ever been in the history
of Canadian federalism, in the history of this parliament, a more
hypocritical government than the one opposite? Has there ever
been one? No.
An hon. member: No, it is the worst.
Mr. Réal Ménard: Look at the situation. This is a government
that is raking in surpluses.
The hon. member for Saint-Hyacinthe—Bagot mentioned certain
data from the finance minister's estimates. He was talking about
a $60 billion surplus.
Mr. Yvan Loubier: His mistakes in estimates.
Mr. Réal Ménard: His mistakes in estimates were of about $60
billion.
Not only has the government accumulated surpluses to the extent
that we know, but year after year, despite the host of economists
working for it, despite the econometric models that exist,
despite the Department of Finance's powerful computers, it has
been unable to estimate its assets and surpluses correctly—
Mr. Antoine Dubé: Or it made a mistake on purpose.
Mr. Réal Ménard: There is no doubt that it made a mistake on
purpose. This regime is based on hypocrisy, it is based on smoke and
mirror tactics. Do you truly believe that people will accept
that? No.
Let me give a few examples. While the government has these huge
surpluses, there is money to be paid. There are legitimate
demands from the government of Quebec. These demands often come
from both the Liberals and the Parti Quebecois. When dealing with
such issues, there is a consensus in the national assembly.
Let us take an example with which I am very familiar, the
expansion of the Palais des congrès. How many times did the
Minister of National Revenue, who is responsible for the Economic
Development Agency of Canada for the Regions of Quebec, rise in
this House to say, in a bragging tone of voice, “We believe in
regional development and we want to use taxes paid by Quebecers
to promote development in Montreal and the regions”.
When the real test came, when the time came to get involved
financially in structuring projects for Montreal, this government
said no. It would not give anything, not even a penny.
We know about the tourism industry in Montreal. People from
Europe and elsewhere come to Montreal to spend a few days and go
to the Olympic stadium, and so on. But there is also what is
called business tourism. That is what governments want to focus
on, business tourism, not only pleasure tourism.
As a student, I was not as strong in economics as our finance
critic, but I did take some classes where we were told “As the
construction industry goes so goes the world”. The construction
industry is very important. The government of Quebec paid for the
expansion of the Palais des congrès all by itself, even though
the federal government owes us $59 million.
The federal government could have taken this opportunity to
support economic growth in Montreal.
I could give the House other examples like the ice storm.
Hydro-Québec has submitted a claim for $400 million for losses
incurred by crown corporations.
I see, Mr. Speaker, that my time is running out, although I feel
like I have just begun. What I want to tell the government in
conclusion is that everyone should support our motion, because it
is not right for Ottawa to have all that money while so much
pressure is being exerted on the services in the provinces.
[English]
Mr. Tony Valeri (Stoney Creek, Lib.): Mr. Speaker, I
hesitate to use the word hypocritical. It is not my word. It
was used by the hon. member across the way. What I find somewhat
hypocritical is the fact that the Bloc is now recognizing tax
points. This is great news.
I would inform the hon. member that when he is talking about the
value of tax points with respect to health care, the value of the
contribution by the federal government is 30 cents and not 14
cents.
1335
I recognize the hon. member's comments about some of the other
pressures that are on the health care system with respect to the
change in demographics. The hon. member should recognize some of
the other transfers that are actually made to the province of
Quebec, such as 32% of the health research funds. Health care
research is critically important to ensure a sustainable health
care system.
While I respect the fact that the member can stand up in the
House and engage in the debate, he should do so by recognizing
the facts. The facts are that the contribution to Quebec by the
federal government is substantially larger than the hon. member
is prepared to recognize. I ask the hon. member to recognize
that fact.
[Translation]
Mr. Réal Ménard: Mr. Speaker, I am going to ask our colleague
on the government side to read the conclusions of the Clair
commission. This commission is not the Bloc Quebecois or the
government. The federal government is assessed as follows: “For
every dollar spent by the Government of Quebec, 14 cents comes
from the federal government, no more, no less”. When our
colleague suggests that it is 30 cents, I respectfully submit he
is out to lunch.
Second, as concerns research and development, with the fifty
centres belonging to the federal government on the Ontario
side—well, they are in the greater Outaouais-Ontario region,
they are not on the Outaouais side, but on the Ottawa side—the
figures given me are fairly dramatic. They date from 1999 and
show that Quebec receives only 14.4% of the jobs in R and D.
Is our fellow member asking us to be satisfied with that? Is he
asking us to keep a provincial and colonial mentality? If that
is so, I say that on this side of the House we will never agree
to that.
Mr. Richard Marceau (Charlesbourg—Jacques-Cartier, BQ): Mr.
Speaker, it is always intimidating to rise just after the very
eloquent member for Hochelaga—Maisonneuve. However I will try to
take the challenge offered so kindly to me by my colleague and
friend from Montreal.
Since I have been listening to the debate I have had the feeling
that government members have not taken the time to carefully read
what we are debating. We are asking that the federal government
call a federal-provincial first ministers' conference for the
purpose of rectifying the fiscal imbalance between the federal
government and the provinces in offering a new way to share the
tax base, including through a tax points transfer that will
respect the constitutional responsibilities of Quebec and the
other provinces.
We are not asking to turn everything upside down, change the
world or reinvent the wheel. We want a proper forum to be created
to deal with a lack of balance in the tax system, which is
acknowledged by most economists and stakeholders in Quebec and
Canada.
The representations or questions raised by the Liberal member
who spoke before me could or will be brought to the table by the
federal government for discussion by the first ministers. I do
not agree with his point of view. Instead of making demagogic
speeches as he did, let us create a forum where such discussions
will be meaningful because they will lead to concrete action
within a very short time.
Let me say that the reason why government members will not vote
for the motion is because they like the current situation which
is part of Canada's nation building continuum, which started
several decades ago and gathered speed in 1982 with the
unilateral patriation of the constitution and is increasingly
gathering speed since 1995.
1340
This government is intent on turning the federal state that
Canada should be into a unitary state. It is wants to weaken the
provincial governments and turn them into big municipal
governments, to rake in astronomical surpluses at the expense of
the provinces so that Ottawa can wallow in money while the
provinces have to take up increasingly difficult challenges with
their heads barely above water.
While feeding mere crumbs to the provinces, the federal
government is not just weakening them, it is also deciding on its
own to dictate conditions on the transfer of new funds, impose
national standards, bulldoze its own constitution—which sets out
federal and provincial jurisdictions—to build a Canada that is
more and more uniform nationally, a Canada that negates the
specificity not only of Quebec, something which is crucial and
essential, but also of other provinces.
We have many options. We still have in Quebec a continuous
position that dates back to the Maurice Duplessis government. The
Union Nationale governments of Duplessis, Johnson and Bertrand,
the Liberal governments of Lesage, Johnson and Bourassa, and the
PQ governments of Lévesque, Johnson, Parizeau, Bouchard and now
Landry all had or have the same position.
There is still a very broad consensus in Quebec that fiscal
imbalance has been around for a long time and that it does exist.
There is a consensus on this.
We know it only too well. We saw with the young offenders that
there is no Quebec consensus that will stop this government. It
is really a shame, and Quebecers will remember this when the time
comes.
The member opposite talked about federal spending and said that
the federal government gave more to Quebec than it deserved. That
is what it boiled down to. I would like to respond, if I may, as
follows. In 1997, federal government program spending in Quebec
was $28.3 billion, or 23.9% of the total for Canada. That is less
than Quebec's demographic share, which is 24.4%. But it is worse
than that because when we take a closer look we see the form
this spending took.
Quebec is over-represented when it comes to equalization
payments and employment insurance—$2.9 billion more than its
demographic weight—but under-represented when it comes to
structuring spending, such as procurement of goods and services,
investments and grants which represent $3.5 billion less than
its demographic weight.
According to an independent organization, the Institut de la
statistique du Québec, this under representation of $3.5 billion
deprives Quebec of 45,500 jobs, which would account for half of
the historic difference between the rate of unemployment in
Quebec and in the rest of Canada.
When Premier Bernard Landry said that the federal system was not
to Quebec's advantage, he went even further, and he was perfectly
right. Other figures could be mentioned.
According to the Institut de la statistique du Québec, $100
million in federal government spending generates 920 direct and
381 indirect jobs. Spending of $3.5 billion would therefore mean
45,500 jobs in Quebec.
More specifically, this means that these jobs amount to
one and a half times the number of jobs in all of the Gaspé
peninsula; 80% of the jobs on the North Shore; two-thirds of the
jobs in Abitibi—Témiscamingue; one-third of the jobs in the
Eastern Townships; and one-third of the jobs in
Saguenay—Lac-Saint-Jean.
1345
The federal government is not giving Quebec its fairshare. Given
the losses incurred by Quebec because of the fiscal imbalance and
given the losses incurred by Quebec because the money spent by
the federal government in Quebec is mainly passive money and not
structural spending that generates economic activity, jobs and
economic development, this is not only a criticism of the federal
government—as we have said before, successive governments in
Quebec have raised this question since Duplessis—it is a
criticism of the system itself and of the logic of the system.
It is imposing more and more constraints on Quebec, with the
result that it has to face increased social spending. My
colleague from Hochelaga—Maisonneuve was talking about this a
little earlier. Quebec's social spending is increasing at an
alarming rate. In health alone, it is increasing by 5% per year.
Quebecers are faced with the following choice. They do not have
to choose between the status quo and the full and complete
control over their development. They have a choice between Quebec
sovereignty and an increasingly centralizing and unitary
federalism, which is weakening the provinces a little more every
day, riding roughshod over the Quebec nation, negating more and
more the reality of Quebec, ignoring its consensus and
personality, in fact aiming at making the Quebec nation disappear
in the medium and long term.
This is the choice that the people of Quebec have. We will see
that Quebecers will make the right choice and realize that the
solution lies in full control over their development mechanism,
sovereignty.
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker, I
would like to ask my colleague a question in connection with an
intervention by a former parliamentary secretary to the minister
of finance.
He said we were in an advantageous position as far as R and D
investments are concerned, spending on laboratories. What is he
thinking of? We hear on all sides that this is not the case,
that Quebec is disadvantaged. The government side always turns
up with miraculous figures and proportions. I do not know where
they get them. I do not know what mental gymnastics they use to
come up with them.
Would the hon. member be able to give us the truth?
Mr. Richard Marceau: Mr. Speaker, first of all, I would like
to respond to the question of the hon. member for
Saint-Hyacinthe—Bagot as to where the figures come from. I too
would like to know. I think the Liberals just pull them out of the air
before they come here.
When we look at the future of R and D investment—we are in an
increasingly wired world, and the future belongs to the most
productive R and D people—federal R and D investments in Quebec
represent 14.4%, which is more than 10% less than our population
share.
I can hear my hon. colleague from Saint-Lambert say it is not
so. These figures come from the Minister of Finance's own
statistics, her minister, who says that 14.4% of research and
development expenditures go to Quebec. The most flagrant example
is that of the federal capital—the only national capital in
Canada is Quebec City—where all R and D centres in the greater
Ottawa region are on the Ontario side. There is not a single one
on the Quebec side.
I challenge the hon. member for Saint-Lambert to find a figure
other than 14.4% for federal R and D expenditures in Quebec and
to show me an R and D centre in the Outaouais region on the
Quebec side as opposed to the Ontario side. I send her this
challenge. Let her take the floor to tell us what the figures
are, if they are other than the ones I have given.
1350
[English]
Mr. Tony Valeri (Stoney Creek, Lib.): Mr. Speaker, I
just could not let the member's comment go by. To use his word,
fabrication is the topic of the day. The fact that we are here
debating this issue is, in a lot of people's minds, a
fabrication.
From what I have heard to date, the Bloc is engaged in some
phenomenal gymnastics. If the figure I provided earlier is not
enough, perhaps the hon. member would want to get up and
challenge the fact that Quebec receives 26% of the infrastructure
dollars and 50% of the technology partnership fund which are
actual dollars that flow directly into the province of Quebec.
Let us not dwell on throwing these numbers back and forth but
let us recognize that there is a role for the federal government.
The role is to maintain a united country that works for the best
interests of all Canadians. That is something I do not believe
the hon. member has with respect to his interest in being in this
House.
[Translation]
Mr. Richard Marceau: Mr. Speaker, if the Liberal member who
just asked a question wanted to be honest, he should not be so
close to the tree that he ignores the forest.
I will explain. It is easy to look at a program in isolation,
but we should consider the whole situation. The figures for his
own department are as follows: the Quebec share of federal
spending on goods and services is 21%; its share of current
transfers to businesses is 16.5%; its share of R&D; is 14.4%.
These figures come from his department.
It is quite easy to look at just one program. Instead of being
too close to a single tree, let us look at the forest. When we do
this, we realize that Quebec is being short changed.
The Acting Speaker (Mr. Bélair): I must remind the hon.
members that all members are honest.
[English]
Mr. Steve Mahoney (Mississauga West, Lib.): Mr. Speaker,
I find it interesting that the only resolutions or ideas that
come from the Bloc deal with taking money, power or both, and we
know they are both the same, away from the federal government and
giving increased money and power to the provincial government in
Quebec City.
We know what the agenda is of the members from the Bloc but I
find it curious indeed when I sit in this place and see the
Leader of Her Majesty's Loyal Opposition stand in his place and
rap his arms warmly around the Bloc's concept of stripping power
away from the federal government and increasing it at the
provincial level.
What we have here is a group in opposition who are indeed
provincial politicians who should be selling their wares in the
beautiful province of Alberta or in the province of Quebec. The
reality is that there is a role, much to the chagrin of the Bloc
Quebecois, for the federal government.
Mr. Speaker, I will also be splitting my time after question
period with the member for Markham.
I find it astounding to hear members of a national parliament
stand in their place, as a member opposite did, and refer to the
nation of Quebec and to hear the Canadian Alliance agree with
that. The reality is that there is no nation of Quebec. There is
a wonderful province of Quebec in the nation of Canada. It is
about time those members understood that.
I heard a member also stand in his place and ask when the
Liberals were going to accept the consensus of the people of
Quebec? I have a message for that member. Perhaps that member
did not get it in the last election.
1355
The Liberals won 10 additional seats in the province of Quebec
in the last election. We accept that. We are quite happy to
accept that. We have 36 or so people in the Quebec caucus
representing the federal government in the province of Quebec.
The issue is not whether Quebec City, Toronto Queen's Park or
Alberta should have more authority to take more money away from
the people, or whether or not the federal government should
deliver services. The real issue is that the provincial
governments, and my province of Ontario is a classic example,
having done this for years, continue to run a deficit while
cutting taxes, which means they are cutting taxes while borrowing
money to pay for those tax cuts. Someone help me understand
where that fits in economics 101.
How can the province of Ontario, with a straight face, hand out
to all hospitals around the province envelopes with $2 million,
$3 million, $4 million, and $5 million for the purpose of buying
capital equipment? When we add up the amount of money being
transferred to the hospitals it just happens to be $294.5
million. That happens to be the exact amount of money
transferred from the federal treasury to the province of Ontario
for the purpose of acquiring new equipment. Is that not
interesting?
How can the province then turn around and announce it will spend
$114 million on children's services under the ministry of
community and social services? When we look at the CHST and the
amount of money transferred under that agreement to the province
of Ontario from the federal government, it just happens
coincidentally to be $114 million.
The real issue is how to make the nation work. I suggest there
is a very important role for the government to play in terms of
national standards. I say to the members of the Bloc Quebecois
that there is only one nation. Outside of the one policy they
have in their policy platform they are not bad parliamentarians,
except that every once in a while that one policy, like eating a
bad cucumber, comes back up.
That policy simply says that they want to destroy Canada. I
have news for them. We will not let them do it under any
circumstances. Under our watch there is no chance and no way
that they will have success in convincing either Quebecers or
Canadians that somehow we should split the country along
provincial lines. It is not on.
I had the privilege of attending the FCM conference in Banff,
Alberta, last weekend where I spoke to many people from Alberta
and many people from right across the country. The people from
Alberta love this country. They will not allow any kind of an
unholy alliance between the Canadian Alliance and the Bloc
Quebecois destroy what amounts to the greatest country in the
world, a country of which we are all very proud.
STATEMENTS BY MEMBERS
[Translation]
FOREURS DE VAL-D'OR
Mr. Guy St-Julien (Abitibi—Baie-James—Nunavik, Lib.): Mr.
Speaker, today is a day of great celebration in Val-d'Or, in
honour of the hockey players, coach and trainers of the Foreurs
de Val-d'Or, and their solid performance at the Memorial Cup in
Regina.
The Foreurs de Val-d'Or's super performance is the result of
their character, great spirit and exceptional team solidarity.
They never let up, right to the final game.
The Quebec major junior hockey league champions and Memorial Cup
finalists will be feted as champions this evening at the Palais
des sports de Val-d'Or, and greeted by the cheers of the hockey
fans of Val-d'Or and the entire Abitibi—Témiscamingue region.
* * *
1400
[English]
CENSUS RECORDS
Ms. Carol Skelton (Saskatoon—Rosetown—Biggar, Canadian
Alliance): Mr. Speaker, in today's National Post there
is a story about Grey Alexander, an Alberta sheep farmer, who is
upset that the local area census worker has access to personal
information about him.
Mr. Alexander was contacted by a census worker after he failed
to complete the long census form in full. The problem is the
census worker is someone he knows quite well.
To quote Mr. Alexander, “Elements of my income end up with
somebody I see twice a week. What if it's a business competitor
or somebody you have acrimony with? This is a small town”.
In today's Saskatoon Star Phoenix there is a letter
describing a similar situation. To quote the writer, “There is
no one in our community to whom I knowingly would have provided
all the private personal confidential information contained in
the census form. Not even the loans officer at my bank in
town”.
Statistics Canada clearly needs to do a far better job of
protecting confidentiality of census data in rural areas.
* * *
[Translation]
JEAN-DOMINIC LÉVESQUE-RENÉ
Mr. Bernard Patry (Pierrefonds—Dollard, Lib.): Mr. Speaker,
every year the United Nations Environment Program awards the
prestigious Global 500 award to individuals who have made an
exceptional contribution to environmental protection.
I am extremely pleased to announce to the House that this year's
Global 500 Youth Environment Award went to Jean-Dominic
Lévesque-René, a young Canadian from Île-Bizard, which is in my
riding.
Although only 17 years old, Jean-Dominic has been involved for
some years in a personal crusade against pesticide use. His
crusade is an intensely personal one, because he has overcome
non-Hodgkin's lymphoma, which he links to pesticide use in his
community.
I thank Jean-Dominic and all of the Lévesque-René family for
their tireless work to raise Canadians' awareness of the danger
of pesticide use.
Congratulations, Jean-Dominic.
* * *
[English]
CITIZENSHIP AND IMMIGRATION
Mr. Mark Assad (Gatineau, Lib.): Mr. Speaker, the member
for Cariboo—Chilcotin raised a case in this place two days ago.
Although the member was correct in saying that the Citizenship
and Immigration Department had not sent him a written response to
his query since last August, he conveniently omitted to mention
that the Minister of Citizenship and Immigration's staff had been
in telephone contact with his office several times to resolve
this matter to everyone's satisfaction.
This omission gives us the impression that he is playing
politics with people's cases at the last hour. This is hardly
the way to get the job done, especially when it involves very
complex cases.
* * *
[Translation]
WORLD NO TOBACCO DAY
Mr. Yvon Charbonneau (Anjou—Rivière-des-Prairies, Lib.): Mr.
Speaker, World No Tobacco Day, held every May 31, is organized by
the World Health Organization.
This year's theme is “Tobacco Kills—Don't be Duped”. The aim
of the campaign is to make the public aware of the harmful effect
on health of exposure to secondhand smoke and to promote the use
of strong measures to limit exposure.
[English]
Secondhand smoke is a real and significant threat to public
health. Supported by two decades of evidence, the scientific
community now agrees that there is no safe level of exposure to
secondhand smoke.
[Translation]
On May 31, Health Canada is joining Physicians for a Smoke-Free
Canada in holding a seminar on federal, provincial and municipal
legislation in this regard.
[English]
As well, Health Canada's youth advisory committee on tobacco
issues will sponsor the national virtual blue ribbon campaign for
World No Tobacco Day. The campaign will involve the
dissemination of an electronic version of a blue ribbon featuring
the slogan “Let's Clear the Air”.
* * *
HOCKEY
Mr. Kevin Sorenson (Crowfoot, Canadian Alliance): Mr.
Speaker, I rise today to congratulate the Camrose Kodiaks hockey
team in winning the Royal Bank Cup national junior championship.
The Kodiaks became the second consecutive Alberta junior team to
win the national championship. This was the fourth time in seven
years Alberta has claimed the honour of having the best Junior A,
tier II team in the country.
Camrose defeated the host Flin Flon Bombers 5 to 0 in the finals
on May 13 and tonight they will celebrate their momentous
victory.
When asked to explain why their team was victorious, the Kodiak
players said that they had a great bunch of guys that were a
tight knit group.
Being friends and being close is what made them the better team.
These guys know how to play hockey.
1405
I take my hat off to the Kodiaks and to the great community of
Camrose for its outstanding support. It has been a fantastic
accomplishment and they have done us all proud.
* * *
OXFORD CHILDREN'S GROUNDWATER FESTIVAL
Mr. John Finlay (Oxford, Lib.): Mr. Speaker, this week
over 3,100 elementary school students will converge on Pittock
conservation area in my riding of Oxford. They are taking part
in the Oxford Children's Groundwater Festival. As one of the
original organizers of this event, I was very pleased to be
present during the opening day festivities on Monday.
Through over 40 hands on activity centres, these students are
having enormous fun while gaining insight into the vital role
that water plays in our lives. They are learning about the water
cycle and the importance of conserving and protecting our water
resources.
In light of the recent tragic events in Walkerton and North
Battleford, it is particularly important to teach our children
respect for their environment and the clean water that sustains
us.
I ask my colleagues to join me in congratulating the festival
sponsors, organizers and 400 volunteers for making this wonderful
event possible.
* * *
[Translation]
WORLD NO TOBACCO DAY
Mr. Réal Ménard (Hochelaga—Maisonneuve, BQ): Mr. Speaker,
under the theme of “Tobacco Kills—Don't be Duped”, World
No Tobacco Day has two aims: to encourage the authorities
responsible to take specific steps and to make the public aware
of the real problem that secondhand smoke represents.
It is not a minor irritation to non-smokers, but a real danger
to public health in general. A smoker inhales only about a third
of a cigarette, and secondhand smoke contains 43 cancer causing
chemicals. Over half the population is exposed daily to
secondhand smoke.
Tobacco smoke is a real health threat and ranks third as a
primary cause of death, behind active smoking and the use of
alcohol. There is no doubt that secondhand smoke causes a
number of deaths each year.
Let us join together in our fight against smoking and
particularly against the harmful effects of secondhand smoke on
public health in general.
* * *
[English]
ORDER OF CANADA
Mr. Bob Kilger (Stormont—Dundas—Charlottenburgh, Lib.):
Mr. Speaker, it is with great pleasure that I bring the name of
Mr. Jake Lamoureux of Cornwall to the attention of the House.
In this the international year of the volunteer, Mr. Lamoureux
personifies the very word volunteer.
Over his lifetime he has served as president of six different
organizations, has chaired 10 different events and served on
fundraising committees for 11 different organizations.
Big Brothers and Big Sisters, the United Way, the Children's Aid
Society, the Canadian Cancer Society, the Cornwall Chamber of
Commerce, Hotel Dieu Hospital Board Foundation, the Children's
Treatment Centre and Medic Alert Foundation are some of the
organizations that have benefited from the efforts of Jake
Lamoureux.
Today he was honoured by being received into the Order of Canada
as a member for his volunteer efforts.
For Mr. Lamoureux this award is not only for himself but it is
recognition of the support he has received for his years of
dedication to volunteerism, support from his family members, such
as his sister the late Lorraine Robertson, his good friends, such
as Angelo Towndale, and the community.
I offer Mr. Lamoureux my personal congratulations and that of
the community for being received into the Order of Canada.
* * *
MEMORIAL CUP
Mr. Bob Mills (Red Deer, Canadian Alliance): Mr. Speaker,
this past weekend the Red Deer Rebels won the Memorial Cup in
Regina. Our last national cup was the Centennial Cup in 1980.
The team finished first out of 55 teams. They won 79 of 105
games they played this year.
The Rebels have worked extremely hard to obtain this title and
should be very proud of themselves. The Rebels' solid work ethic
starts at the top with their coach Brent Sutter. Brent and his
assistant, Dallas Gaume, and many others in the organization have
done a fantastic job in bringing out the best in these talented
players to build an aggressive and team oriented group of young
men.
The Red Deer Rebels are an outstanding organization. The hockey
club is very active in central Alberta and support many
worthwhile causes. As the member of parliament for Red Deer
constituency, I am proud of the Rebels as is all of our
community.
I again congratulate the Rebels for a fantastic season and for
making all of Red Deer and central Alberta proud.
* * *
[Translation]
BILINGUALISM
Ms. Hélène Scherrer (Louis-Hébert, Lib.): Mr. Speaker,
yesterday evening, the Canada-Belgium parliamentary group held
its first event of the season, a roundtable on the theme “Ottawa,
a Bilingual Capital”.
Several distinguished guests, including the Minister and
Vice-President of the capital region of Brussels and Chair of the
European Union regions' committee, Jos Chabert, the Ambassador of
Belgium, the Canadian Minister of Intergovernmental Affairs, the
Chairman of the National Capital Commission and the Commissioner
of Official Languages, contributed to an eclectic evening that
produced lively discussions.
1410
These discussions stressed the importance of preserving
bilingualism in our national capital and, more importantly, in
our vast country. This meeting with Belgium officials made us
appreciate their efforts to promote multilingualism.
They showed us that a country can thrive even more when its
citizens respect their various languages and cultures, and those
of their neighbours.
As co-chair of the group, I firmly believe that the vision
presented to us at these meetings can help us promote our
linguistic duality.
* * *
[English]
LAW OF THE SEA CONVENTION
Mr. Peter Stoffer (Sackville—Musquodoboit Valley—Eastern
Shore, NDP): Mr. Speaker, I would like to bring to the
attention of the House the fact that in 1994, 1995, 1996 and
yesterday the hon. member for Davenport has raised this question
to his own government: When is the government going to ratify
the law of the sea convention? Four different ministers in six
years have said the same thing, “It is our number one priority.
We need to do it right away. We will do it right away”.
It was a 1993 red book promise that the Liberal government, if
elected, would sign the law of the sea convention.
We are now hearing disturbing reports that the Atlantic salmon
off our east coast is in very serious trouble and that other
aquatic species throughout our coastlines are in very serious
trouble. Thousands of fishermen and their families will lose
their livelihood if the government does not get off its butt and
ratify the law of the sea now.
* * *
[Translation]
NATIONAL CANCER SURVIVORS DAY
Mrs. Suzanne Tremblay (Rimouski-Neigette-et-la Mitis, BQ): Mr.
Speaker, on Sunday, the whole world will celebrate the 14th
annual Cancer Survivors Day. It is the largest cancer survivor
event.
It was organized for the first time in 1987 in Kansas City by
Richard Bloch, a cancer survivor, and his wife Annette, to remind
people that a diagnosis of cancer is not an automatic death
sentence.
Since then, each year, on the first Sunday in June, we pay
tribute to those who are undergoing or have undergone cancer
treatment. Statistics show that in Canada one person in three
will be diagnosed with cancer.
But it is reassuring to know that more than half of those
affected by cancer can look forward to a full recovery. The great
hope of researchers is to someday be able to cure all those who
are diagnosed with cancer. Several colleagues in the House and
myself are living proof that cancer can be beaten.
I encourage all those who are engaged in a battle against that
disease to hang in there and to keep their hopes up.
Some hon. members: Hear, hear.
* * *
[English]
ORDER OF CANADA
Ms. Nancy Karetak-Lindell (Nunavut, Lib.): Mr. Speaker,
today Mr. Ralph Ritcey will receive the Order of Canada for his
commitment to education and the Inuit of Canada.
As superintendent of education for the federal department of
northern affairs, Mr. Ritcey was dedicated to making sure Inuit
could pursue further education in the south.
When I left my home of Arviat to finish high school in Ottawa, I
was fortunate to meet Mr. Ritcey and be one of those touched by
his work. For Inuit to leave their home to seek education in the
south was often hard and the time and effort Mr. Ritcey spent in
assisting the students helped in making the process easier for
many of us.
The efforts of Mr. Ritcey contributed greatly to the creation of
Nunavut as many of the leaders benefited from his educational
policies.
Nunavut thanks Mr. Ritcey for his passion for education and the
care he took of his students. I sincerely congratulate him on
his well-deserved Order of Canada.
* * *
NATIONAL DEFENCE
Mr. Gerald Keddy (South Shore, PC): Mr. Speaker, the
operational requirements for the helicopters that will be
replacing the Sea Kings have been lowered to two hours and twenty
minutes with a thirty minute fuel reserve. This allows
Eurocopter's Cougar to qualify for the reduced endurance
capacity, a capacity that is significantly lower than
the four hour flying time offered by the Sea Kings when they went
into operation in 1962.
In 1996 the Liberals decreased requirements to three hours with
a thirty minute reserve. In 1999 the Liberals decreased
requirements to two hours and fifty minutes with a thirty minute
reserve. The government now has dropped to the absolute minimum
accepted by military specifications to two hours and twenty
minutes and the reserve.
When will the government make decisions based on logic and
reason and not based on the Prime Minister's pride?
* * *
1415
[Translation]
ASSISTANCE TO VICTIMS
Mr. Claude Duplain (Portneuf, Lib.): Mr. Speaker, I would like
to tell the House about the Government of Canada's initiative to
help victims in Quebec.
The Société de criminologie du Québec and the Regroupement
d'étudiants: prévention et intervention touchant la santé et la
sexualité de l'UQAM have received more than $50,000 in funding.
This funding will promote discussions among those working in the
criminal justice system. It will also help to raise awareness of
victims' needs.
In addition, through their assistance fund and work, these
organizations help to build victims' trust in the criminal
justice system.
* * *
FRENCH IMMERSION PROGRAMS
Mr. James Moore (Port Moody—Coquitlam—Port Coquitlam,
Canadian Alliance): Mr. Speaker, I rise today in the House to
pay tribute to Canadian Parents for French. Thanks to their
efforts, a growing number of Anglo-Canadians express themselves
well in French.
Today, over 300,000 Anglo-Canadian students are taking part in
French immersion programs, and almost one quarter of Canadians
between the ages of 18 and 29 speak English and French.
I am addressing the House in French today, and my sister is a
teacher of French, because both of us participated in a French
immersion program.
I am proud that the city of Coquitlam in my riding is the
birthplace of French immersion schools in western Canada. I
thank Canadian Parents for French and all the parents who make
such an investment in their children's education.
I urge all parents to consider the benefits of learning a second
language at school.
ORAL QUESTION PERIOD
[English]
NATIONAL DEFENCE
Mr. Stockwell Day (Leader of the Opposition, Canadian
Alliance): Mr. Speaker, in 1993, when the government
cancelled the helicopter contract previously negotiated by the
Tory government, there was a cost of almost half a billion
dollars.
Now we understand with a process that will involve splitting the
contract, as we have just discovered, there will be a cost of
another $400 million on top of the almost half a billion that has
already taken place and there will be increased risk to military
personnel.
Will the Prime Minister please tell us: With higher cost and
higher risk, how does that add up to the best deal?
Hon. Alfonso Gagliano (Minister of Public Works and
Government Services, Lib.): Mr. Speaker, first, overall
savings for Canadians in the combined purchase of maritime search
and rescue helicopters were in the range of $1.5 billion over the
EH-101 procurement of the past government.
Second, with one contract we had three potential bidders. With
two contracts we have 13 potential bidders and they are Canadian
companies. That means a better price, more competition, more
Canadian technology development and more Canadian jobs.
Mr. Stockwell Day (Leader of the Opposition, Canadian
Alliance): Mr. Speaker, it is not a better buy when we are
purchasing a product that cannot do what the former one could do.
It will not fly as far. It cannot do the job as well. It is not
a better purchase.
In 1994 we understand that two servicemen actually perished when
a Sea King helicopter caught fire in mid-air. Just last week a
Sea King did an emergency landing on an Australian warship.
The government is not concerned about the extra risk. It is not
concerned about the extra cost. Is it at least concerned about
the extra delay in getting a good, safe product to our military?
Hon. Art Eggleton (Minister of National Defence, Lib.):
Mr. Speaker, the hon. member is talking about old cold war
requirements back in the seventies or even the sixties. We need
a helicopter for the current and future needs of the Canadian
forces. That is why the military recommended a change in the
specifications. It is entirely a military consideration and
recommendation that the government is adopting.
Meanwhile we are putting money into the Sea King to make sure it
is safe to fly. Accidents can happen with any age of aircraft.
We are cutting down on that possibility, that risk, by investing
more money and making sure it is safe to fly.
Mr. Stockwell Day (Leader of the Opposition, Canadian
Alliance): Mr. Speaker, this is not about old cold war. I am
talking about the civilian in the cold water. The new product
helicopter will not be able to reach him like the old one would.
That is what we are talking about.
[Translation]
It is not up to the opposition to decide who will win the
helicopter contract, but it is up to us to ensure that the
process is open and transparent.
Will the Prime Minister assure us that his government is not
giving the edge to its friends, and that it is not keeping EH out
of the selection process?
1420
Hon. Alfonso Gagliano (Minister of Public Works and Government
Services, Lib.): Mr. Speaker, on the contrary, we have
established a process conducive to fairness and transparency.
I just finished saying this. With one contract, we have three
bidders; with two contracts, we have thirteen. This means that there
are more possibilities, more people who can bid, and therefore
more competition, more transparency and a better price.
[English]
Mr. Peter Goldring (Edmonton Centre-East, Canadian
Alliance): Mr. Speaker, the 25 year Liberal procurement
merry-go-round continues. Where it stops nobody seems to know:
$500 million for a political cancellation, 25% of one cost
estimate for the entire project, and new lower specifications:
25% less range, 25% less fly time, 25% less in mission
capability, 25% less than the 40 year old Sea King.
Why is the Liberal way, the Liberal solution, a 75% helicopter
the—
The Speaker: The hon. Minister of National Defence.
Hon. Art Eggleton (Minister of National Defence, Lib.):
Mr. Speaker, again cold war mentality. That is not what we
require today. The specifications are what the military say we
require today.
The comment about the civilian in the water shows that the hon.
member has no understanding of what this helicopter is about. It
has to do with maritime patrol in blue water on high seas from
the back of frigates. It is not the search and rescue
helicopter. We have bought another helicopter for the search and
rescue function.
Mr. Peter Goldring (Edmonton Centre-East, Canadian
Alliance): Mr. Speaker, let us listen to what the military
has to say about this requirement:
That is from an internal DND document. It continues:
Why is the minister saying the military is lowering the
requirements when this document clearly indicates that politics
are lowering the mission standard by a full 25% below the Sea
King?
Hon. Art Eggleton (Minister of National Defence, Lib.):
Mr. Speaker, there was quite clearly some discussion within the
military and a desire to clarify different requirements, but this
was all done within the military context by people who are expert
in this matter.
Ultimately they recommended to me, and I recommended it to
cabinet, the statement of requirements that stands today. There
was no political interference in the statement of requirements.
* * *
[Translation]
YOUNG OFFENDERS
Mr. Gilles Duceppe (Laurier—Sainte-Marie, BQ): Mr. Speaker,
Quebec's success in rehabilitating young offenders has nothing
prefabricated about it, to borrow the expression used by the
Minister of Intergovernmental Affairs.
Its good results are very real. With the exception of P.E.I,
Quebec has the lowest youth crime rate in Canada.
Does the Minister of Justice realize that the government is
shrugging off the opinion of the experts responsible for Quebec's
success with rehabilitation, the same experts who are unanimous
in denouncing her bill, the bill that passed in this House.
There is still time for her to react.
[English]
Hon. Anne McLellan (Minister of Justice and Attorney General
of Canada, Lib.): Mr. Speaker, I have reacted to this
opinion. As I have said throughout, our new youth justice
legislation provides all provinces with sufficient flexibility to
pursue policies and programs that make sense for them. That is
very true for the province of Quebec.
[Translation]
Mr. Gilles Duceppe (Laurier—Sainte-Marie, BQ): Mr. Speaker,
all those who are involved in this, all those working in the
field, do not share the minister's opinion, even those who might
be more likely to be in favour of repression. By this I mean the
victims of crime.
The director of the Bureau d'aide aux victimes d'actes criminels
is also of the opinion that the new young offender legislation is
not good for either youth or victims.
Will the minister admit that all reasoning people in Quebec want
to see the focus on rehabilitation and are unanimously opposed to
the legislation she wants to impose?
[English]
Hon. Anne McLellan (Minister of Justice and Attorney General
of Canada, Lib.): Mr. Speaker, this new legislation puts
increased emphasis on rehabilitation and reintegration of young
people into society. Therefore I would call upon the Bloc to
support our efforts in that regard.
1425
I return to the basic point that there is sufficient flexibility
in this legislation for the province of Quebec to pursue policies
and programs as it sees fit.
[Translation]
Mr. Michel Bellehumeur (Berthier—Montcalm, BQ): Mr. Speaker,
when so many experts and credible individuals such as judges,
police officers and social workers reject her bill and tell the
minister she is making a mistake, the minister should listen.
Does the minister not hear alarm bells from the experts who tell
her that her bill is threatening the Quebec approach, which
promotes rehabilitation rather than repression?
Those who apply the law and are the source of Quebec's success
are telling you that you are wrong, Madam Minister. Is that not
setting off a bell—
The Speaker: Order, please. The hon. member knows that he
must address his remarks to the Chair.
[English]
Hon. Anne McLellan (Minister of Justice and Attorney General
of Canada, Lib.): Mr. Speaker, as I have said before, our new
youth criminal justice legislation increases the focus upon
rehabilitation and reintegration.
As I have also said before in the House, we will be providing
additional resources to all provinces including Quebec to build
upon their successful programs and policies.
[Translation]
Mr. Michel Bellehumeur (Berthier—Montcalm, BQ): Mr. Speaker,
instead of going after the separatists, is the government
prepared to acknowledge that the experts opposing this bill do so
because the statistics indicate, year after year, that Quebec's
approach is the best?
These people, in contact with the victims and with the relatives
of these victims, have the figures and recognize that Quebec's
model works, that we are on the right track and that we are
properly applying the law.
Why does the minister not listen to reason in this and
acknowledge that Quebec is right?
[English]
Hon. Anne McLellan (Minister of Justice and Attorney General
of Canada, Lib.): Because in fact, Mr. Speaker, we have
listened. We have listened to those who are experts in the youth
justice system across the province of Quebec.
That is why we have enhanced our focus on rehabilitation and
reintegration. That is why we are providing additional resources
to all provinces to carry on their policies and programs.
* * *
FRESHWATER EXPORTS
Ms. Alexa McDonough (Halifax, NDP): Mr. Speaker, the
government pretends that it is opposed to the export of bulk
water. Yet Environment Canada has issued a tender call to
estimate the economic value of our water “to help government
make decisions on water exports”.
If the federal policy is really no to the export of bulk water,
why is the government advancing the very opposite behind the
backs of Canadians?
Hon. David Anderson (Minister of the Environment, Lib.):
Mr. Speaker, the hon. member is mistaken both in her preamble and
in her question.
There is no policy change by the Government of Canada. The
government remains committed to the prohibition of movement of
bulk water out of watersheds. We will continue to protect water
at the source rather than at the border.
Ms. Alexa McDonough (Halifax, NDP): Mr. Speaker, I think
it is crystal clear what the government is up to. It is putting
a price tag on our water so that when it decides to export it, it
will be ready, which is exactly what we feared in 1999 when
Environment Canada's website stated that bulk water exports await
the development of foreign markets.
To clear up any confusion about where the government stands,
will the minister immediately remove the tender call for water
commodification?
Hon. David Anderson (Minister of the Environment, Lib.):
Mr. Speaker, I really do not know where the hon. member has been
since Walkerton. Witness after witness has pointed out that the
way Canadians value water has led to its misuse. The way
Canadians assume water is a free good is one of the reasons they
appear unwilling to pay the amounts of money needed to protect
water sources.
The member should look at the testimony given in Walkerton and
she will find the importance of making sure that we collect the
data needed so we can make intelligent decisions when it comes to
water and its protection.
* * *
NATIONAL DEFENCE
Right Hon. Joe Clark (Calgary Centre, PC): Mr. Speaker, I
have a simple question for the minister of public works. Did his
former deputy minister, Ranald Quail, ask the minister for
written direction on how to proceed with the Sea King replacement
project and did the minister provide that written direction?
Hon. Alfonso Gagliano (Minister of Public Works and
Government Services, Lib.): Mr. Speaker, as ministers we
receive a lot of communications between deputy ministers and
ministers. I do not think I should reveal what discussions have
taken place between me and my deputy minister.
1430
I can tell the hon. member that the procurement strategy the
government decides is very clear. The procurement strategy is
open and transparent. It is open to everybody. As I said
before, with one contract we had three possible bidders. With
two contracts we have thirteen possible bidders. I think that is a
very open and transparent procurement strategy.
Right Hon. Joe Clark (Calgary Centre, PC): Mr. Speaker,
let me try this simple question again. Did the minister refuse
to give his most senior official the written direction his most
senior official requested on this politically contentious file?
Hon. Alfonso Gagliano (Minister of Public Works and
Government Services, Lib.): Mr. Speaker, I always give
directions to my deputy. I have been doing it since I have been
a minister and I will continue to do so.
* * *
NATIONAL DEFENCE
Mr. Charlie Penson (Peace River, Canadian Alliance): Mr.
Speaker, according to an internal briefing note from the chief of
the maritime staff, senior navy and air force officers were
stunned to learn of changes to the statement of operating
requirements for the new marine helicopter project. They note
that there was no explanation of why the changes to the statement
of operating requirements were necessary.
Since these changes probably came from the Prime Minister's
Office, could the Prime Minister please explain why they were
necessary?
Hon. Art Eggleton (Minister of National Defence, Lib.):
Mr. Speaker, it was part of a dialogue between people in the navy
and people in the air force as to what our requirements would be,
given our needs now and in future. There was discussion and
dialogue about the old cold war types of requirements, which was
a different kind of mission altogether.
They went through all of this and at the end of the day the
Canadian forces made a recommendation to me. I in turn made it
to cabinet. There was no political interference in the matter.
Mr. Charlie Penson (Peace River, Canadian Alliance): Mr.
Speaker, we will see. The memo we obtained indicates that the
Sea King helicopter is one of only three aircraft armed with
significant weapons systems in the Canadian forces and that a
change to the statement of requirements is in effect directing
the staff to acquire a non-combat capable aircraft to replace the
one meant for combat. They are to replace that one with a
non-combat aircraft.
Why did the minister's office rewrite the requirements?
Hon. Art Eggleton (Minister of National Defence, Lib.):
Mr. Speaker, my office did not rewrite the requirements. It was
quite clear the navy decided that the kind of helicopter we
needed today was quite different from the helicopter needed at
that time and that we were not into an anti-submarine warfare
kind of scenario as we were during the cold war.
Patrol and surveillance, extending the surveillance capabilities
of our frigate ships, was the purpose. That is what they ended
up writing the specification for. There was no political
interference in their doing that.
* * *
[Translation]
EMPLOYMENT INSURANCE
Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les
Basques, BQ): Mr. Speaker, for years now, the Bloc Quebecois has
been fighting for unemployed workers and against government cuts
to the EI system. Today, the Standing Committee on Human
Resources Development has just approved the Bloc Quebecois'
position and is recommending substantial changes in the EI system
to the government.
Will the minister accept the recommendations of the all-party
committee, convince the Minister of Finance that he must stop
raiding the EI fund to the tune of $6 billion a year, and use
this money for unemployed workers?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, I thank and congratulate members of the
committee for their work on employment insurance. Indeed today
they tabled their report and in it are included a number of
recommendations that they ask the government to consider.
As is always the case, I will take the time to review the report
in detail and respond to the committee in due course.
[Translation]
Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques,
BQ): Mr. Speaker, the Minister of Finance has the money, the
minister now has the recommendations, and unemployed workers
need changes to be made to the EI system now.
Would the minister agree to proceed by unanimous consent by the
end of the session so that we can pass the necessary legislation
by the end of June?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, I remind the House and the hon. member
that it was Liberal members on this side of the House who worked
with the government to ensure the changes presented in Bill C-2
found speedy passage.
1435
I would remind the House that it was the Bloc members who voted
against the intention to repeal the intensity rule, who voted
against the changes to the clawback provision and who voted
against the changes to the re-entrance provision for parents. I
think they have a lot of answering to do to their constituents.
* * *
CENSUS RECORDS
Mr. Grant Hill (Macleod, Canadian Alliance): Mr. Speaker,
the census information is supposed to be private and
confidential. Imagine the dismay of one of my constituents to
find that his neighbour had access to every personal question on
his census form.
Why was that personal information made available to neighbours?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr.
Speaker, the census information in question was made available to
a census official who was sworn to secrecy and subject to
penalties if the information was made public. This was somebody
doing a job. I think it is a disservice to describe those
officials as a neighbour. This was someone working.
If any Canadian does not want to provide information to the
census that way, they have an opportunity to send their
information through the mail or through a 1-800 line. There
should be no question about privacy in this regard.
Mr. Grant Hill (Macleod, Canadian Alliance): Mr.
Speaker, the minister should tell that to Grey Alexander, my
constituent. He got a phone call from the census worker and he
said “Trudy, is that you?” Trudy said “Yes, it is me”. Trudy
has quit her job because it is so intrusive.
Grey Alexander says that he will not fill out that information,
and I say it is intrusive, so my question stands. Why is
personal information being made available to neighbours and
acquaintances? It should never happen.
Hon. Brian Tobin (Minister of Industry, Lib.): Mr.
Speaker, the member has now gone from describing the individual
in question as a neighbour to being a census official.
There is provision that anybody who wants to provide census
information in an anonymous fashion can do so. Unless it is the
position of the party opposite that there ought to be no census
information, that we can just assume that we all began with
alligators in the swamp, I think we should stick with the census.
* * *
[Translation]
OFFICIAL LANGUAGES
Mr. Benoît Sauvageau (Repentigny, BQ): Mr. Speaker, earlier this
week, the minister responsible for official languages told us
that he was closely monitoring the situation at Air Canada and
Nav Canada, and that the government was very concerned by it.
But, through its various spokespersons, the government has been
repeating the same thing for 30 years.
It is time to act. Can the minister tell us what concrete
measures he intends to take to correct this totally unacceptable
situation that is dragging on?
Hon. Stéphane Dion (President of the Queen's Privy Council for
Canada and Minister of Intergovernmental Affairs, Lib.):
Mr. Speaker, the Commissioner of Official Languages issued a very
disturbing preliminary report. Air Canada said that it would act
on it. It is in its interest to do so, because it is being
accused of not respecting the law. This is a very serious
matter. We will follow it up very closely and so will the
Standing Joint Committee on Official Languages.
Mr. Benoît Sauvageau (Repentigny, BQ): Mr. Speaker, the
minister should stop following.
If he is serious about settling this matter, what is he waiting
for to table a concrete plan of action to bring permanent
solutions and put an end to a problem that has been dragging on
for over 30 years?
Hon. Stéphane Dion (President of the Queen's Privy Council for
Canada and Minister of Intergovernmental Affairs, Lib.):
Mr. Speaker, this is a very serious matter and this is why we
will not develop a plan based on a preliminary report, but on
the final one.
* * *
[English]
THE ECONOMY
Mr. Jason Kenney (Calgary Southeast, Canadian Alliance):
Mr. Speaker, a growing number of business leaders are expressing
concern about the so-called productivity initiative being led by
the Ministers of Industry and Human Resources Development, the
Bonnie and Clyde of the federal treasury.
Catherine Swift of the CFIB says that this initiative is
“potentially some big black hole”.
Why is the Prime Minister again undercutting his finance
minister by allowing these big spenders to invent new
bureaucratic programs? Why will he not listen to the business
community which says that productivity in this country will not
go up until capital taxes, EI premiums and marginal rates go
down?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr.
Speaker, on this side of the House we work together in a
collaborative fashion for the benefit of all Canadians.
On that side of the House the Leader of the Opposition has the
advantage of your advice and support and we all know where that
has led in terms of productivity.
The Speaker: I hope the Minister of Industry was not
suggesting that the Speaker was taking sides in supporting anyone
in this House with his expression of “your”. I know the hon.
member intended to address his remarks through the Chair and I
have a feeling they were not.
1440
Mr. Jason Kenney (Calgary Southeast, Canadian Alliance):
Mr. Speaker, I note that his leadership rival chose not to answer
the question. He talks about productivity. Under this
government productivity has fallen by seven points against the
U.S. Personal disposable income has gone from 83% of U.S. levels
to 55% of U.S. levels. Productivity is going down three times as
quickly as it is in the United States.
How will a whole array of new Ottawa style bureaucratic spending
programs solve this serious problem? Why does the government not
get its priorities straight, listen to the business community and
bring our taxes down so that our productivity and standard of
living go up?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr.
Speaker, I think the House will acknowledge, as certainly
everybody on this side acknowledges, that under the leadership of
the Minister of Finance and the government we now are in a
position where we have a more competitive capital gains tax rate
than the United States, better treatment of stock options and
more flexibility than the United States.
We have a front end loaded five year tax reduction brought about
by the Minister of Finance. I am proud to say he is the greatest
minister of finance in Canada's history, a great man.
Some hon. members: Hear, hear.
The Speaker: Order, please. Hon. members must know the
Speaker has a cold. I cannot quell a disturbance by yelling as
much as I usually do. I am asking for some co-operation.
* * *
[Translation]
TOBACCO PRODUCTS
Mr. Jeannot Castonguay (Madawaska—Restigouche, Lib.): Mr.
Speaker, my question is for the Minister of Health. The tobacco
industry is selling light and mild cigarettes as safe cigarettes.
Can the Minister of Health tell hon. members of this House what
he is doing to ensure that the tobacco industry can no longer use
the terms light and mild to market its cigarettes?
Hon. Allan Rock (Minister of Health, Lib.): Mr. Speaker, a very
large number of Canadians wrongly believe that mild and light
cigarettes are safer and less harmful. This is not true. The
tobacco companies have created that impression. They have
disguised the reality through their marketing strategy.
As a government, we believe that Canadians are entitled to have
access to the true facts. This is why I have today asked the
companies to withdraw these brands. If they refuse, we will take
action.
* * *
EMPLOYMENT INSURANCE
Mr. Yvon Godin (Acadie—Bathurst, NDP): Mr. Speaker, today
the Minister of Human Resources Development received a copy of
the additional report on the employment insurance program tabled
by the Standing Committee on Human Resources Development.
Last November, the Liberal government admitted that the program
was too rigid and required changes.
Is the minister going to give serious consideration to the
recommendations contained in this report, and will she commit to
making significant changes to the employment insurance program,
to at last correct the errors of the past?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, the government understands the importance
of employment insurance to Canadians. I think it is clear to the
House and to Canadians that this is important to us, because
every year we monitor and assess the impact of employment
insurance on citizens across the country.
As part of the informed debate, the work of the committee will
be considered and the views of the committee are part and parcel
of the monitoring and assessment of this very important program.
* * *
HEALTH
Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Mr.
Speaker, we have limits on mercury in fish in this country for
purposes of health protection just like we have limits on mercury
in fish all around the world.
The government has decided that some fish with dangerous levels
of mercury are okay because they will only harm some of the
people some of the time. It gives no information to fish sellers
and tells pregnant women “Don't worry. There is a warning for
you on the Internet”.
Will the health minister stop such negligence and disregard of
human health and accept his responsibility for ensuring all
species of all fish are safe for all people every day of the
week?
Hon. Allan Rock (Minister of Health, Lib.): Mr. Speaker,
the health of Canadians is protected by the government. Health
Canada does have strict limits on all these toxic ingredients and
we enforce them.
We let consumers know what the safe limits are for eating
certain fish where the levels are elevated. That is the way to
protect the health of Canadians. The member and those who raise
this issue should stop scaremongering, or is it fishmongering?
* * *
1445
[Translation]
EMPLOYMENT INSURANCE
Mr. André Bachand (Richmond—Arthabaska, PC): Mr. Speaker,
seasonal work's peak period has arrived. The current Employment
Insurance Act and its regulations are making hundreds of families
poorer and damaging the economy of a number of regions of the
country.
There are still too many seasonal workers who do not qualify.
Could the Minister of Human Resources Development tell us whether she will
amend the act soon and thoroughly, in order to enable seasonal
workers to receive benefits?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, I remind the hon. member that just
recently we passed Bill C-2 in which we repealed the intensity
rule. That does have a direct impact on seasonal workers.
As the hon. member points out, the issue of seasonal work is one
that pertains to particular regions across the country. That is
why we are working, region by region, with communities to help
diversify the economy and find new solutions for employment for
Canadians living in those parts of the country.
[Translation]
Mr. André Bachand (Richmond—Arthabaska, PC): Mr. Speaker,
the minister says “region by region”. Let us provide an example
to better illustrate the problem.
Last year, the minister justified having workers from Charlevoix
change regions by linking the lower north shore and Minganie
region with the Lower St. Lawrence, L'Islet and Montmagny region.
The effect of this was to penalize seasonal workers in
Charlevoix.
The minister can act immediately and quietly to help the workers
of Charlevoix. Is she prepared to do so now?
[English]
Hon. Jane Stewart (Minister of Human Resources Development,
Lib.): Mr. Speaker, as I said, on this side of the House we
understand the importance and use of employment insurance, but we
also believe that the most important tool is a job.
That is why we are working directly with communities. I and my
colleague responsible for economic development in the provinces
of Quebec and New Brunswick are working to assist specific
communities build a stronger economy and to focus on ensuring
that the men and women living in their communities have access to
work.
* * *
GRANTS AND LOANS
Mr. Jim Abbott (Kootenay—Columbia, Canadian Alliance):
Mr. Speaker, today we learned that the Auberge des Gouverneurs,
the hotel the Prime Minister showered with grants and loans in
the months prior to the 1997 election, has filed for bankruptcy
protection.
Given that the taxpayers are on the hook for the money, will the
Prime Minister take responsibility for the millions of dollars he
obtained from Canadian taxpayers to finance this failed business
venture?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr.
Speaker, I am very surprised the member would put the question in
that way given that with respect to this project the local caisse
populaire; the mayor and councillors of Shawinigan; Société
québécoise de développement de la main-d'oeuvre; the local
tourist association; the provincial péquiste member of
parliament, Claude Pinard; the local MNA for the house of
assembly; and a variety of different funding institutions
participated in developing this facility.
From time to time we do have bankruptcies in Canada. They
happen in all ridings represented in this assembly, but no one
would suggest that governments should not participate—
The Speaker: The hon. member for Kootenay—Columbia.
Mr. Jim Abbott (Kootenay—Columbia, Canadian Alliance):
Mr. Speaker, let us take a look at what the minister and the
government are responsible for, not the other part of it.
Let us talk about the federal government's part: $720,000 from
HRDC and $925,000 from the BDC, at election time by coincidence.
The federal economic development agency lent the hotel $400,000
and gave the adjoining convention centre $658,000. That is $2.7
million. Surely even the minister must take $2.7 million as a
serious amount of money to be responsible for.
Hon. Brian Tobin (Minister of Industry, Lib.): Yes, Mr.
Speaker, that is a serious amount of money to be responsible for.
I am very happy to report that with respect to the BDC the funds
it provided are totally secured in this transaction.
* * *
[Translation]
INTERNATIONAL TRADE
Mr. Marcel Gagnon (Champlain, BQ): Mr. Speaker, yesterday, the
parliamentary secretary said that there has been no change in
government policy on the issue of cheese sticks for the last 20
years.
The minister does not seem to be aware that, in 1995, there was
a change. The government agreed to an import quota of 20,412
tonnes of cheese products.
My question is for the Minister for International Trade. Why is
the minister continuing to jeopardize the cheese industry by
granting additional import permits in excess of the quotas that
were negotiated?
1450
Hon. Pierre Pettigrew (Minister for International Trade,
Lib.): Mr. Speaker, there has been no change in Canada's policy
on this matter for the past 20 years.
Unfortunately, since 1999, the United States has refused to
import Canadian products that are of excellent quality. Our
government is determined to reopen the U.S. market to Canadian
cheese producers.
As for occasionally allowing imports in excess of the quotas,
this always happens for specific consumers who need a specific
product. It is the only way these import permits are issued.
Mr. Marcel Gagnon (Champlain, BQ): Mr. Speaker, it is time
the minister reviewed his file.
Because of his careless handling of this issue, cheese stick
imports have increased by 70% over the past three years.
Why does the minister persist in telling the House that if we
import products it is because we have needs? This is false.
Producers tell us that they have all they need to meet domestic
demand.
Hon. Pierre Pettigrew (Minister for International Trade,
Lib.): Mr. Speaker, the hon. member is contradicting himself. He
is saying we do not need it, but imports have increased by 70%.
If imports have increased by 70%, it must be because there is a
demand on our market.
We will continue to protect and to promote the interests of
Canadian producers who make very good products that are popular
in our market. We also want to reopen the U.S. market, from which
they have been cut off since 1999.
* * *
[English]
JUSTICE
Mr. Bob Mills (Red Deer, Canadian Alliance): Mr. Speaker,
Canadians want Lisa's law. It may be too late for Lisa Dillman
but it is not too late for thousands of Canadian children across
the country.
The Minister of Justice talks about putting children first. This
is a perfect example of how she has failed again. Her lack of
action defends the rights of pedophiles over children.
I ask again: Will the Minister of Justice ensure that children
will never be forced to visit pedophiles in jail ever again?
Hon. Anne McLellan (Minister of Justice and Attorney General
of Canada, Lib.): Mr. Speaker, in relation to this very
difficult and troubling situation, the hon. member is probably
aware that we and the provinces are in the process of reviewing
the Divorce Act and family law legislation across the country.
I certainly encourage the hon. member and anyone else who is
interested to make known their views as to whether or not we can
better define that which is in the best interests of the children
for the purposes of the Divorce Act.
Mr. Bob Mills (Red Deer, Canadian Alliance): Mr.
Speaker, study, study, study, that is all we hear.
John Schneeberger, a convicted sexual offender and pedophile, is
using his children to get at his ex-wife. His children are being
used as pawns in a sick game. When these types of individuals
are convicted of sexual assault they should lose their ability to
force visits with children.
I ask again: Will the minister change this law so that it never
happens again? We do not need to study it. Canadians are saying
it is wrong.
Hon. Anne McLellan (Minister of Justice and Attorney General
of Canada, Lib.): Mr. Speaker, as I have pointed out to the
hon. member on a number of occasions, and as Mr. Justice Foster
made plain in a court in Red Deer on Friday, Mrs. Dillman can
either appeal or seek variation of the custody and access order.
I would encourage her to do that as quickly as possible to end
this difficult situation for everybody.
* * *
TOBACCO PRODUCTS
Ms. Carolyn Bennett (St. Paul's, Lib.): Mr. Speaker, my
question is for the Secretary of State for Children and Youth.
Today is World No Tobacco Day. Recently released figures show
that smoking rates for youth are declining, but we have a lot
more work to do, particularly with young women, aboriginals and
in Quebec.
Could the secretary of state tell the House what the Government
of Canada is doing to combat smoking among Canada's youth?
Hon. Ethel Blondin-Andrew (Secretary of State (Children and
Youth), Lib.): Mr. Speaker, earlier this month the Government
of Canada announced a $480 million tobacco control strategy. Of
this amount, $210 million will go toward a mass media campaign
with special emphasis on youth.
I am also pleased to inform the House that earlier today my
colleague the Minister of Health launched three youth pilot
projects: Rightstuf Racing, Blue Ribbon Campaign and VRAI. These
projects are designed to raise awareness on tobacco issues and to
build on the protection, prevention and cessation elements of the
new tobacco control strategy.
* * *
1455
GRANTS AND LOANS
Mr. Rick Casson (Lethbridge, Canadian Alliance): Mr.
Speaker, the government is about to guarantee a huge loan of
Canadian taxpayer money to an American company just so it can buy
Canadian airplanes. The loan is estimated to be worth $1.5
billion. The Minister of Industry has spun this as a one time
deal to save jobs.
With the emergency funding tab multiplying every few months, how
many exorbitant one time deals will Canadians be on the hook for,
for this one private company?
Hon. Pierre Pettigrew (Minister for International Trade,
Lib.): Mr. Speaker, I know the Alliance has always had a soft
spot for Embraer. There was a time when it was providing all the
information it could against Bombardier to help it at the WTO.
Despite the Alliance's effort, we have won four panel decisions
at the WTO.
We will get to the bottom of this affair and will safeguard the
jobs of thousands of Canadians, not only in Quebec, as those
members would like people believe, but from coast to coast, led
by Bombardier, a great champion of Canadian industry.
Mr. Rick Casson (Lethbridge, Canadian Alliance): Mr.
Speaker, $1.5 billion is a lot of money. Would it not be better
for the government and the aerospace industry in Canada to level
the sanctions in the four cases we have won against Brazil,
instead of guaranteeing loans?
The Prime Minister told us he would fight fire with fire when
dealing with unfair trade situations with Brazil. Will he make
the right decision when dealing with hard working taxpayer money?
Hon. Pierre Pettigrew (Minister for International Trade,
Lib.): Mr. Speaker, our government will make the decisions
that are necessary to bring Brazil back to the table. We want to
end this folly of subsidies in the aircraft business.
It does not make any sense for Brazil to go that route. Canada
is determined to go back to dialogue and negotiation with Brazil.
We will take the means necessary to convince the Brazilians to
come back to the negotiation table and stop these financing loans
at costs that are not acceptable in the aircraft business.
* * *
[Translation]
REGIONAL DEVELOPMENT
Mr. Yves Rocheleau (Trois-Rivières, BQ): Mr. Speaker, my
question is for the Minister of Industry.
Yesterday, the government of Quebec announced a grant of $23.5
million to the integrated centre for pulp and paper technology in
Trois-Rivières. The university, the CEGEP and the industry have
thus joined forces to make our region a leader in pulp and paper
training and development throughout Quebec and eastern Canada.
In light of the promises of the Liberal Party of Canada during
the election campaign, when does the Minister of Industry intend
to make his decision known to stakeholders in the Mauricie
region, who are waiting on his commitment to make this project a
reality?
Hon. Alfonso Gagliano (Minister of Public Works and Government
Services, Lib.): Mr. Speaker, my colleague, the Minister of
National Revenue, received a new request for financial assistance
on April 5. The file is under study and, as soon as it has been
analyzed, we will make our position known.
* * *
[English]
CANADA CUSTOMS AND REVENUE AGENCY
Mr. Paul Harold Macklin (Northumberland, Lib.): Mr.
Speaker, what is Canada Customs and Revenue Agency doing to
ensure that its workforce continues to be representative of the
four employment equity designated groups now that it is a
separate employer?
Ms. Sophia Leung (Parliamentary Secretary to Minister of
National Revenue, Lib.): Mr. Speaker, our agency is committed
to have a workforce which reflects all Canadian people. We will
have full representation of all designated groups, such as
disabled, visible minorities, women and aboriginals. We are
proud to meet that target.
* * *
AGRICULTURE
Mr. Howard Hilstrom (Selkirk—Interlake, Canadian
Alliance): Mr. Speaker, the Prime Minister in a reincarnation
of Captain Canada, or is it now captain alligator, has said that
he will wage a Brazilian aircraft war by fighting fire with fire.
What about our farmers who only receive one-third of the subsidy
received by U.S. farmers?
The government is not willing to match agriculture subsidies
throughout the U.S. but gives this multinational corporation,
Bombardier, whatever it takes. Where is the fire to fight fire
for our Canadian farmers?
Hon. Herb Gray (Deputy Prime Minister, Lib.): Mr.
Speaker, I think the hon. member ought to check with his deputy
leader, the hon. member for Renfrew—Nipissing—Pembroke, who was
quick to praise a federal loan to Haley Industries, a
subcontractor of Bombardier, located in her riding.
1500
At the same time, this government has provided over $500 million
in additional funding for farmers in outright grants. If the
member wants to praise the industry in the deputy leader of the
opposition's riding, then he ought to accept the validity of
support for Bombardier and for our farmers.
* * *
SHIPBUILDING INDUSTRY
Ms. Alexa McDonough (Halifax, NDP): Mr. Speaker, this
concerns the steady erosion of the shipbuilding industry in this
country and the devastating loss of shipyard workers' jobs.
I commend the minister for facilitating an important
collaboration between the shipbuilders and the shipyard workers
in this country. He now is in receipt of an excellent report
breaking through with solid recommendations for what we need to
do to advance our shipbuilding industry.
When can Canadians expect a detailed response and, more
important, concrete action from the government to enhance the
shipbuilding industry?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr.
Speaker, first, may I thank the member for her question and
agree with her that the report indeed is an excellent report in
that it departed from the traditional approach vis-à-vis
shipbuilding. It has made no request, no claim and no argument
for the notion that we can maintain the industry by maintaining
the basis of subsidies for shipbuilding.
Instead, it has built its report upon the belief that an
innovative shipbuilding industry, taking those skill sets, those
shipyards and finding the niches where it can be successful, is
what government, the private sectors and the unions working
together ought to achieve.
We are working on the report and we expect a response in the
weeks ahead.
* * *
PRESENCE IN GALLERY
The Speaker: I would like to draw the attention of
hon. members to the presence in the gallery of His Excellency
Claudio Mansilla, Minister of Foreign Trade and Investment of the
Republic of Bolivia.
Some hon. members: Hear, hear.
The Speaker: I would also like to draw the attention
of all hon. members to the presence in the gallery of Tony
Knowles, Governor of the State of Alaska.
Some hon. members: Hear, hear.
* * *
BUSINESS OF THE HOUSE
Mr. John Reynolds (West Vancouver—Sunshine Coast, Canadian
Alliance): Mr. Speaker, I would like to ask the government
House leader the usual Thursday question, the business for the
rest of the week and the business next week.
Hon. Don Boudria (Leader of the Government in the House of
Commons, Lib.): Mr. Speaker, this afternoon we will continue
debate on the Bloc opposition motion.
On Friday we would like to commence consideration at report
stage and third reading of Bill S-24, the Kanesatake legislation.
We would then take up the report stage of Bill C-11 on
immigration, followed, if there is any time, with the report
stage of Bill C-25, the Farm Credit Corporation legislation.
When we return on Monday, we will commence debate at report
stage and third reading of Bill S-17, the patent legislation.
On Tuesday, we will proceed with third reading of Bill C-11.
On Wednesday, we will take up report stage and third reading of
Bill S-16, the money laundering legislation, followed by report
stage of Bill C-25 if necessary.
I know all members have been reading with attention the report
of the commission, chaired by the hon. Ed Lumley, on compensation
which was tabled earlier this week. I hope to continue
consultations next week and would hope that we could find a way
to deal with these issues at that time in relation to the
report provided to us by Commissioner Lumley and others.
* * *
POINTS OF ORDER
BILL S-15
The Speaker: Today the Chair heard submissions on a point
of order raised by the government House leader in relation to
Bill S-15, a bill that has now received first reading in the House.
At the request of certain hon. members, the matter was deferred
until today for two hon. members to make submissions. The hon.
House leader for the opposition perhaps could give the Chair the
benefit of his advice on this point.
1505
Mr. John Reynolds (West Vancouver—Sunshine Coast, Canadian
Alliance): Mr. Speaker, the two questions raised with respect
to Bill S-15 are in regard to the need for a royal recommendation
and whether the levy described in the bill is a tax.
The fundamental purpose of the requirement for a royal
recommendation is to limit the authority for appropriating money
from the consolidated revenue fund to the government.
In section 2 of the Financial Administration Act, appropriation
is defined to mean any authority of parliament to pay money out
of the consolidated revenue fund. The consolidated revenue fund
is defined to mean the aggregate of all public moneys that are on
the deposit of the credit of the receiver general. Only
ministers can obtain the necessary approval from the governor
general for a royal recommendation to appropriate these funds.
The constitution stipulates that bills requiring or processing a
royal recommendation must originate in the House of Commons.
With respect to Bill S-15, the money raised through the levy is
to be collected by the Canadian tobacco industry. Therefore I
see no requirement for a royal recommendation for the bill.
The second question has to do with whether or not the levy
established through the bill constitutes a tax. In plain
language of the bill, the bill speaks in terms of a levy rather
than a tax. The purpose of the levy, as stated in the bill, is
to meet an industry purpose beneficial to the industry, although
the industry purpose also has public benefit.
The levy is imposed exclusively on tobacco products of whatever
description and is to be spent in pursuit of the goals listed in
the bill. Consequently, what is being proposed is a levy, not a
tax.
Erskine May describes two criteria by which a bill proposing a
levy is exempt from the financial procedures, including the
adoption of a ways and means resolution that would normally apply
to bills imposing a tax. The first criterion is that the levy
must be for industry purposes. The second is that the funds
collected must not form any part of government revenue.
Erskine May includes examples of bills from the United Kingdom
which were regarded as levies, as well as those which failed to
meet either or both of these two criteria.
There are recent Canadian experiences, as well. In this
parliament we have the example of Bill C-27 which imposes a levy
on the nuclear industry. The government felt it necessary to
attach a royal recommendation to the bill and adopted a ways and
means motion prior to its introduction.
In support of Bill S-15, we have the example of Bill C-32, an
act to amend the Copyright Act, which was considered in the 35th
parliament. Bill C-32 imposed a levy on the sale of blank tapes
to be distributed to artists and artist groups as a form of
royalty. Bill C-32 did not have a royal recommendation and the
bill was not preceded by a ways and means resolution.
In Speaker Parent's ruling of December 2, 1998, regarding Bill
S-13, the predecessor to Bill S-15, he cited the following:
The levy was of benefit to that industry since it permitted the
audio duplication of copyright material for private use. This
would enhance the market for blank audio tapes. The levy on the
tapes was designated to raise funds by which owners of copyright
material would be compensated for losses caused by private
duplication of that material. The link between the benefit to
the industry and the levy being imposed seems clear in that case.
To make a comparison of Bill C-32 to Bill S-13, the Speaker went
on to say of Bill S-13:
Surely the lack of credibility referred to here is a function of
our common sense understanding of the self-interest of the
tobacco industry, namely, that as a commercial enterprise its
primary goal is to expand its markets and thereby to increase
profits. Young people would constitute the future growth
potential for the industry's market. How could it be to the
benefit of the industry to reduce smoking among the very people
who would constitute its growth market? It is this implausible
proposition that underlies the credibility problem to which the
bill refers.
With all due respect to Speaker Parent, he may have been a
competent school teacher and a respected speaker of the House but
that did not qualify him as a director of marketing for a tobacco
company.
I, myself, do not pretend to guess at the marketing strategy of
those corporations. If the fate of the bill hinges on whether
the levy is a benefit to the industry or not, we should get that
answer from the tobacco industry itself.
1510
The claim that the bill is not beneficial to the industry is
false. The industry has been asking for this very bill. It has
been running ads in support of Bill S-15. I have a copy here and
I will give a copy to you, Mr. Speaker, at the end of my
comments. At the end of the ad it states:
Imperial Tobacco and JTI MacDonald strongly support Bill S-15. We
believe that it is consistent with our companies' view that
underage people should not smoke and that the decision to do so
should be an informed one made only by adults. We commend those
who have worked so hard to help bring Bill S-15 towards reality
and reaffirm our support for the Bill and the Foundation it would
create.
There you have it, Mr. Speaker. The industry clearly supports
the bill. If we go back and consider Speaker Parent's suggestion
that common sense prevail, it is common sense that Bill S-15 is
beneficial to the tobacco industry since it is going to great
lengths and spending large sums of money on these ads promoting
the bill.
The other weakness in the argument of Speaker Parent in this is
when he said:
How could it be to the benefit of the industry to reduce smoking
among the very people who would constitute its growth market?
Mr. Robert Parker, chairman and chief executive officer of the
Canadian Tobacco Manufacturers' Council, stated before the
Standing Senate Committee on Legal and Constitutional Affairs on
April 1, 1997, the following:
The manufacturers agree that youth should not smoke, period.
Don Brown, past chairman, president and CEO of Imperial Tobacco
and chair of the Canadian Tobacco Manufacturers' Council, made
similar comments regarding youth smoking to the Vancouver Board
of Trade on October 1, 1998. He said “We believe children
should not smoke—”.
Finally, Speaker Parent, in his ruling, overlooked the fact that
selling cigarettes to minors is against the law. He was
suggesting that breaking the law is a common sense marketing
strategy.
In the event the Speaker is sympathetic to the point of view of
the government House leader, I offer another alternative, and
this will be my last point.
In our rules there are exemptions regarding financial matters.
Standing Order 80(1) states:
All aids and supplies granted to the Sovereign by the Parliament
of Canada are the sole gift of the House of Commons, and all
bills for granting such aids and supplies ought to begin with the
House, as it is the undoubted right of the House to direct, limit
and appoint in all such bills, the ends, purposes,
considerations, conditions, limitations and qualifications of
such grants, which are not alterable by the Senate.
Standing Order 80(2) states:
In order to expedite the business of Parliament, the House will
not insist on the privilege claimed—.
The standing order describes these circumstances as, and I
quote:
The purpose and the benefit of Bill S-15 would be to prevent
young people from smoking. Since this is considered an offence,
it would meet the criteria of Standing Order 80(2). I would
think that the government and all members of the House would not,
in this instance, insist on its financial privileges. Bill S-15
is aimed at significantly reducing underage smoking in Canada.
What better reason is there than that.
Finally, the Senate Speaker, in his ruling of April 2, 1998 on
Bill S-13 said that it was his view that, and I quote:
In this case I would argue that we should give the benefit of
the doubt to the receivability of Bill S-15 and allow for debate
and a decision by the House on a very important issue for the
young children of this country.
Mr. Peter MacKay (Pictou—Antigonish—Guysborough, PC):
Mr. Speaker, I would first like to express my gratitude to the
Chair for deferring this matter in order to hear my brief
submission, as well as the submission of my learned friend.
I will be focusing in on procedural, as opposed to legal or
constitutional arguments, which is where I believe the focus
should be on this particular point.
The issues at play are very important and very complex. They go
to the very pith and substance of responsible government. The
sad part is that it is the failure of the government to act
responsibly that has given rise to this bill.
The ruling of Speaker Parent dealt with the content of Bill
S-13. Bill S-15, we are told, was drafted to answer some of the
procedural objections raised by the Chair. This bill of course
we know originated in the Senate. Others have also addressed
that point and supporting material has been filed with the Chair.
Speaker Parent's ruling seemed to reject, based on a common
sense approach or standard, that the industry could not possibly
want something that would hurt its own cause. Yet there is a
clear indication that the industry does in fact want this
scenario and has asked for it on previous occasions.
1515
The logic seems to be that the industry was possibly in the
process of hurting itself, yet the Speaker seemed to think this
was implausible. Following that logic, if the industry was in
favour of causing harm to children this would be illegal. We
very much need to look at what the industry has said in this
instance.
The government House leader has suggested that the levy proposed
in the bill amounts to a tax and therefore a burden on the
people. However there is proof that it is not a tax. If one
examines in detail the provisions of the bill one will find that
it is not a tax.
Let us look closely. The charge is made not on the population
at large but is placed on the industry itself with the proceeds
directed specifically and narrowly. The proceeds are to be used
completely outside the process of government and, I hasten to
add, for a positive benefit: the promotion of health and healthy
living of young Canadians. The proceeds are not to be used by
the government but are for private use.
There is a precedent for this situation. It is dealt with on
page 763 of the 18th edition of Erskine May. At this point I
must recognize that Speaker Parent resorted to precedent from the
22nd edition of May.
There is a corollary issue surrounding the issue of competing
editions of this volume and the degree to which the house of
commons at Westminster continues to indirectly legislate this
parliament, but that is best left for another time. I will return
to my friendly 18th edition of May where I find compelling
precedents that outnumber the modest rule of the 22nd edition.
Speaking of instances where levies have been treated as matters
outside the ways and means rules, Erskine May cites 10 instances
of bills which oppose levies and levies which have been used for
purposes other than direct positive benefits to an industry. The
levy can be used for other purposes. Clearly precedents exist
both in the jurisdictions of Great Britain and Australia. I
submit that this is the case with respect to Bill S-15. I am
quoting from page 763 of Erskine May which states:
It may sometimes be difficult to define the limits of an
industry, as in the Wheat Bill, 1932 (which was treated as within
this rule) under which levies upon importers of flour formed a
fund for making payments to growers of wheat. An even more
difficult case was the Mineral Workings Bill, 1951, under which a
fund fed by contributions from ironstone operators, owners and
the Exchequer was set up to restore agriculture land from which
iron ore had been extracted. This again was held to be a levy on
the operators and owners though it involved some extension of the
rule.
The royal recommendation was required on the mineral workings
bill because of the contribution required from the exchequer.
That was significant in the House as recorded in volume 486 of
Hansard, column 1809. There was no royal recommendation
required in the instance of the wheat bill. Both bills passed
both houses without being treated as taxes.
It is my submission that Bill S-15 has nothing to do with public
funds. It distinguishes itself from the traditional definition
of tax because there is no reference to public funding. All
money collected from the companies would go directly to the
foundation and would bypass general revenue. The government
would not touch it. The origins and arrivals would not evolve
around the government or the public purse. It would in no way
impact in terms of a revenue generating source.
Further, it distinguishes itself from any traditional definition
of tax because there is no reference to public funding. If one
were to look at it from a Canadian analogy or perspective,
perhaps one should ask if it would be proper to originate a
private bill in the Senate which established an enterprise such
as a railroad, a church or an international bridge. In that
legislation the enterprises were given the duty to carry out
certain objectives and in return the right to make enforceable
charges upon their clientele.
That is the situation that applies in this instance. There is a
willing customer and a willing vendor seeking the right to carry
out an enterprise under the authority of the Parliament of
Canada.
1520
The Speaker knows that private members' bills can and indeed
regularly originate in the Senate. All sorts of special
conditions and powers are granted to those private situations.
When a bill arrives here from the Senate, the House does not look
into the question of how the Senate views the bill. It arrives
here not as a Senate public bill or a Senate private bill, but
rather as a bill passed by the Senate to which the concurrence of
the House of Commons is requested.
If the House is to restrict the right of the Senate to send us
private bills which contain financial powers for the applicants,
there will be a significant problem for canals and international
bridges that levy tolls and for churches and other bodies
established under the authority of the Parliament of Canada.
Mr. Speaker, in conclusion, I thank you again for facilitating
my contribution to this procedural issue. As you have said, it
is an important issue for the public to understand. The
political issue is not one over which you have any influence. You
are acting as referee on questions of compliance within the rules
of the Chamber. All members understand and appreciate your
duties in that regard.
The Speaker: I thank all hon. members for their
interventions on this point. The Chair will take the matter
under advisement, as I indicated yesterday, and will get back to
the House at the first opportunity.
Mr. Derek Lee: Mr. Speaker, there have been consultations
and I wonder if there would be consent to put forward two
committee travel authorizations at this time, one dealing with
the Standing Committee on Public Accounts and the other dealing
with the subcommittee on international trade.
The Speaker: Is the House prepared to deal with these two
motions at this time?
Some hon. members: Agreed.
ROUTINE PROCEEDINGS
[English]
COMMITTEES OF THE HOUSE
PUBLIC ACCOUNTS
Mr. Derek Lee (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, I
move:
That seven (7) members of the Standing Committee on Public
Accounts and three (3) staff persons of the Committee be
authorized to travel to Regina, Saskatchewan, to attend the
Twenty-Second Annual Conference of the Canadian Council of Public
Accounts Committees from September 16 to 18, 2001.
The Speaker: Does the hon. parliamentary secretary have
unanimous consent of the House to propose the motion?
Some hon. members: Agreed.
The Speaker: The House has heard the terms of the motion.
Is it the pleasure of the House to adopt the motion?
Some hon. members: Agreed.
(Motion agreed to)
FOREIGN AFFAIRS AND INTERNATIONAL TRADE
Mr. Derek Lee (Parliamentary Secretary to Leader of the
Government in the House of Commons, Lib.): Mr. Speaker, I
move:
That, in relation to its examination of Softwood Lumber, six (6)
members of the Sub-Committee on International Trade, Trade
Disputes and Investment of the Standing Committee of Foreign
Affairs and International Trade and the necessary staff be
authorized to travel to Washington, D.C., for a period of two (2)
days with travel taking place at some time during the period of
June 1 to July 31, 2001.
The Speaker: Does the hon. parliamentary secretary have
unanimous consent to introduce the motion?
Some hon. members: Agreed.
The Speaker: The House has heard the terms of the motion.
Is it the pleasure of the House to adopt the motion?
Some hon. members: Agreed.
(Motion agreed to)
* * *
BUSINESS OF THE HOUSE
Mr. John Reynolds (West Vancouver—Sunshine Coast, Canadian
Alliance): Mr. Speaker, I believe you would find consent for
the following motion. I move:
That at the conclusion of the present debate on today's
Opposition Motion, all questions necessary to dispose of this
motion be deemed put, a recorded division deemed requested and
deferred to the expiry of the time provided for Government Orders
on Monday, June 4, 2001.
The Speaker: Is there unanimous consent for this motion?
Some hon. members: Agreed.
(Motion agreed to)
GOVERNMENT ORDERS
[English]
SUPPLY
ALLOTTED DAY—FEDERAL-PROVINCIAL FISCAL ARRANGEMENTS
The House resumed consideration of the motion and of the
amendment.
Mr. John McCallum (Markham, Lib.): Mr. Speaker, it is my
pleasure to participate in the debate on the Bloc motion
regarding transferring tax points to the provinces. I will
broaden the discussion a little if I may because there are three
components of the Bloc economic policy that form a logical and
coherent whole. That can be taken as a compliment, I suppose.
[Translation]
The first component is today's motion, that is the transfer of
tax points from the federal government to the provinces.
The second component, which coincides with that, is the Bloc's
notion that the federal government's surpluses next year will be
about $18 billion—according to the Bloc—rather than $7 or $8
billion according to the economists. If that is true, it will be
easier for the government to make such a transfer to the
provinces.
The third component is the Bloc's idea that we should give up
the Canadian dollar and use the U.S. dollar.
1525
[English]
All three of these components are a logical and consistent whole
because all of them separately and together lead to the same
thing. All three lead to a weakening of the federal government,
a weakening of the Canadian economy and an increase in the
likelihood of the separation of Quebec from Canada. While they
are logically coherent, I would for those reasons oppose them all
very strenuously.
I will go through very briefly each of the three components of
the Bloc economic platform. First, on the transfer of tax
points, which is the subject of the motion today, I will comment
very briefly on the major elements of current transfers including
tax points. I will then give the House two reasons why I think
the Bloc motion makes little sense at all.
Right now there are three major components of transfers from the
federal government to the provinces. The first consists of
around $18 billion of cash transfers, which was increased
recently by the health accord in the fall of last year and added
some $20 billion of federal money for health over five years.
Next, and this is something the Bloc Quebecois and indeed all
the provinces tend to forget, we have transfers in the form of
tax points because back in 1977 the federal government
transferred tax points or taxing powers from the federal
government to the provinces. This amounts to a value of $16
billion today whereas in 1977 when the transfer occurred it was
about one-tenth of that.
The fact that the Bloc and the provinces tend to ignore this tax
point component is relevant, as members will see in a minute, to
the subject of its motion respecting the transfer of further tax
points.
The third component of special relevance and importance to
Quebec concerns equalization payments made to have not provinces.
This year those payments consisted of $11 billion of which nearly
half or $5.4 billion went to Quebec. This equalization payment
has been among the fastest growing components of our
expenditures, having increased by 33% over the last decade or so.
[Translation]
It is the status quo. What the Bloc is proposing is that the
federal government transfer more tax points to the provinces. In
my opinion, this is not a good idea at all. What the federal
government did last fall was to make the largest cut in personal
income tax in Canadian history, a $100 billion tax cut, but a tax
cut for Canadian taxpayers.
What the Bloc Quebecois wants is not a tax cut for Canadian
taxpayers, but a tax cut for Canadian provinces. In my opinion,
it is a lot better for the federal government to cut personal
income tax than to cut taxes for the provinces.
[English]
If any province wants more revenue it is entirely free to raise
its own taxes, but if Ottawa has excess money it should cut taxes
to the people, not to the provinces as the Bloc motion suggests.
The final point is even more important. It shows that the Bloc
proposal is inherently and blatantly contradictory. We have had
transfers of tax points from Ottawa to the provinces since 1977.
Whenever provinces say how much Ottawa is contributing to health
care or other social programs, unfailingly they never include the
tax points. The provinces say Ottawa only pays 19% of health
care or some amount like that because they have forgotten the tax
points, which would more or less double the contribution.
Now they want us to transfer further tax points. Do we think
that in the future they will acknowledge that transfer when they
report the contribution of Ottawa to provincial social programs?
Obviously they will not, given the history of the last 24 years
when they have never reported tax points.
1530
[Translation]
So it is obvious that the object of this motion on transfer of
tax points is to reduce the importance of the federal government
in the eyes of Quebecers. That is the true objective of the Bloc
Quebecois because, if the importance of the federal government
is reduced in the eyes of Quebecers, this will advance the cause
of separatists. This is its objective. It has nothing to do with
the economy. It is purely political and a good reason to oppose
this motion.
The second point is related to the first.
According to the finance critic of the Bloc Quebecois, all bank
economists who make these economic forecasts are always wrong
and only the finance critic of the Bloc Quebecois is right. He
showed with graphs the huge forecast errors economists made and
the small forecast errors of the Bloc.
I told him the other day that perhaps he should not be here in
parliament. If his forecasts are so wonderful, he should start
his own business and he would become a millionaire.
[English]
It is true that if one can outperform the market in terms of
economic forecasts one can be a millionaire.
[Translation]
But before the finance critic of the Bloc Quebecois makes this
career change, if I were him, I would continue believing the
economists. Consequently, it seems to me more reasonable to
think that the federal surplus will be $7 billion or $8 billion,
instead of $18 billion, next year.
[English]
I will be very brief on this final point because it is all part
of the same separatist circle coming together. It is the
incessant clamour by the Bloc for Canada to give up its dollar
and use the U.S. dollar. It is evident from a separatist point
of view that this would be a very nice thing, because come the
great day of separation, if we were all using the U.S. dollar,
currency would not be an issue. However, if we were using the
Canadian dollar, it would be a big problem. Obviously from a
purely political view the Bloc favours dollarization.
I have one story to illustrate the point that there is very
little support within the Canadian business community for
dollarization. We had a debate in Quebec on dollarization, which
I participated before I got into politics. Three hundred
business people came to the Montreal board of trade meeting. Then
the organizers wanted to have a repeat debate at the Toronto
board of trade but there was no interest. The dollarization
issue is largely a Quebec issue, in particular a Quebec
separatist issue, plus a sprinkling of academics across the
country. It has no general backing from the Canadian business
community.
In conclusion, I mention these three aspects of the Bloc program
because they all hang together: the further transfer of tax
points; the gross overestimate of next year's federal surplus;
and the incessant clamouring to use the U.S. dollar. They are
coherent in the sense that individually and taken as a whole they
would lead to: first, a weakening of the federal government;
second, a weakening of the Canadian economy; and third, an
advancing of the cause of Quebec separation. On all three of
these grounds I strongly oppose this motion.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker, to
listen to the member for Markham, a former chief economist of
the Royal Bank, people would think that he would make a much
better novelist than an economist, especially with such wild
imaginings.
On the matter of sovereignty alone, I say this to him: no motion
of the House of Commons will bring it about. If he thinks it is
a step in this direction, he is mistaken. We will decide on
sovereignty at home in Quebec with a referendum the issue of
which will be decided by the people of Quebec. He will have
nothing to say on the matter. That is the first thing.
1535
Second, if the single currency is linked to separatism, is
Thomas Courchene, North America's top macroeconomist—at least
considerably better than he is—, who supports a single currency,
a separatist?
Is David Dodge, the Governor of the Bank of Canada, who sees the
single currency as unavoidable in the three Americas within the
next 10 years, another separatist?
I think the member for Markham has a problem somewhere.
There is another problem with what he has just said. He talks
of economists' forecasts.
He is looking out for himself. He was one of the small group of
four or five economists that gravitated around the Minister of
Finance until last year. Not all of them predicted such
ridiculous surpluses as this gang, the buddies of the Minister
of Finance.
When the real non partisan economists—and here we can see he is
partisan, he became the federal Liberal member for Markham—were
consulted, they thought the forecasts of the Minister of Finance
were laughable and forecast surpluses of about the same amount
as we had.
If he is here today, I put the question to him, is it because he
lacked the ability to forecast at the Royal Bank, in fact?
Mr. John McCallum: Mr. Speaker, I will respond to these three
points.
First, the motion has nothing to do with separatism, at least
not directly. This is not a referendum. What I said is that the
more tax points are transferred to the provinces, the less
important the federal government is in Quebec. This advances the
cause of separatism. This is what I said.
Second, I said that it was actually Quebec which was in favour
of a single currency, namely the U.S. dollar, because no one
among Toronto business people wanted to hear about it.
I also said that a handful of academics including Thomas
Courchene supported the idea. I admit to it.
Finally with regard to the finance minister's buddies, yes, I
became a Liberal, but I am the only one. The other ones are
probably more conservative.
I did not make the forecasts, the big forecasting agencies made
them, namely universities. They have no axe to grind, no
political axe to grind.
Maybe they are right, maybe they are wrong, but they are
politically neutral.
Mr. Mario Laframboise (Argenteuil—Papineau—Mirabel, BQ): Mr.
Speaker, I just wanted to point out to my colleague from Markham
that before the election he said,
“Mr. Martin has erred in his forecasts for political reasons so
that the surpluses turn out to be larger than planned”.
What does he have to say about that?
Mr. John McCallum: Mr. Speaker, as usual Bloc members are
totally out of context. This is the same interview in which I
said that the Bloc critic should join the private sector if his
forecasts were truly so fantastic.
What I said in this interview—he missed the important point—was:
“It could have been said two or three years ago that Mr.
Martin would do that—For the past two or three years
economists have been making forecasts and they have no political
agenda.”
At least, for two or three years, the surpluses could not have
been deliberately inflated because they were forecasted by
private sector economists.
Ms. Francine Lalonde (Mercier, BQ): Mr. Speaker, I will be
sharing my time with the hon. member for
Papineau—Argenteuil—Mirabel.
1540
I want to address today's motion from the Bloc Quebecois,
because I want to remind the House where these enormous
surpluses come from. There have been a lot of them since 1996.
Half come from cuts to the employment insurance fund. These
cuts, and the state of the economy, have helped the government
generate surpluses year after year. These were planned
surpluses. Every year, about six or seven billion dollars are
paid by workers, even those who only earn $1,000, and by small
and medium sized businesses that employ the largest number of
workers with salaries that do not, or barely reach the ceiling
at which one stops paying employment insurance premiums. This is
a regressive type of contribution.
The government got these surpluses from the workforce and the
small and medium sized businesses, which are said to play a
critical role in our economic development, particularly in
Quebec. They are the ones who made the greatest contribution to
the surpluses.
What did the government do with these surpluses? Essentially two
things. When the surpluses came as a surprise, following a
dubious planning process, at the end of the year they were
automatically used to reduce the deficit. There was no debate.
Yes, there were negotiations on health, but these came only
after the government was put under a lot of pressure, after
television and newspapers presented dramatic stories about what
was going on everywhere in the health care system.
The federal government also took these surpluses to use, if not
abuse its spending power in provincial jurisdictions,
particularly in Quebec.
Of course, there was a referendum in 1995; the government knows
there will be another one and has already started campaigning.
There is one consequence of these cuts to the employment
insurance plan and to transfers for health and education that
has not been mentioned. I repeat, before they were increased,
health transfers were drastically reduced. Yes, there was a
slight increase, but it depends on how one looks at it; they
went down from $19 billion to $11 billion, and then up to $13
billion. The cuts are slightly less severe, but they are still
huge.
In education, there were even bigger cuts.
When I sat on the industry standing committee, year after year
we heard from university professors and researchers, health
researchers for example, who were in a terrible situation. While
funding for universities in the United States, including in the
area of medical research, was increasing sharply, what was
happening in Canada? Such funding was decreasing, and it was
decreasing sharply. We have just begun to see again investments
in that area. But, again, it is the federal government that will
decide where the money is spent.
I would like to point out something.
Canada prides itself on the international scene of having very
generous social measures. The OECD tells us that, in fact, as far
as social spending is concerned, and I am including all social
spending in the area of health, education, pensions and so on,
from 1980 to 1997—when Canada invested a lot more—Canada ranks
25 out of 29 in this regard.
Some say that Canada is a generous country and that we should
make even more cuts. This is the case of our colleague from
Markham, for example, who says that we have to reduce income tax
instead of transferring tax points to the provinces so that they
can take care of health, education and all the rest of social
spending. What else would he want to see? Would he like to see
Canada drop a few more places, to the bottom of the OECD ranking?
1545
It is very important because even in Canada, people think that
they have one of the best social and educational systems in the
world. Canada ranks 25 out of 29. Then there is the United
States. We say “Oh, we are not like the United States”. We are
close to Japan, where we all know that there is no such thing as
a safety net, close to Turkey, close to Mexico—which is still a
developing country—and close to Korea. Can the members
appreciate who we are close to?
What has happened is really dramatic.
For one of our colleagues to argue that we have brought forward
this motion urging the government to transfer tax points—not
only to Quebec but to all of the provinces—only to promote
sovereignty is shameful.
Going back in history, I would remind the House that the first
to negotiate tax points for Quebec were the Liberals in the
1960s, and then the Union Nationale. Although they were
federalists, they did not agree with the way the money was being
allocated.
Daniel Johnson, of the Union Nationale, was elected after
promising to get his hands back on 100% of the corporate income
tax, 100% of the personal income tax and 100% of the inheritance
tax. Soon after he was elected, he came to Ottawa to try to
negotiate. He was told for the first time by a young Trudeau, a
former member of the NPD freshly out of university, who had soon
realized that, if he wanted to become Prime Minister, he had
better run as a Liberal candidate “I also speak for the people of
Quebec”.
The so-called sovereignist agenda we are supposed to be pushing,
according to the government, focuses on change. Jean Charest, a
Quebec federalist, is travelling to western Canada to meet with
the premiers and ask for tax points.
The problem here is not only Confederation, although it has not
been working well for a long time and is increasingly so, now.
What is in question is the ability of young people to receive a
decent education, the ability of universities to continue to
train intellectuals who will be able to receive scholarships
from funds created by the federal government. The government
creates scholarships, but to be able to receive merit
scholarships in research, there must be a pyramid. This pyramid
must be funded adequately, but it is not, at this time.
Health spending is growing rapidly. Although we are trying to
cut everywhere, it continues to grow. We know the population is
aging, but this is not all. Medication is more expensive.
Surgeries and equipment are also. We know that in Quebec
people working in hospitals do so at a lower cost than in the
rest of Canada.
Consequently, what is happening is the country, which could
compare itself favourably to progressive countries, will now be
comparable to Turkey, Korea and the United States, because
social spending has fallen. When the government says that taxes
must be reduced further, it continues to say that the provinces
will not pay for the spending that is essential to a minimum of
well-being and to the rights of the citizens.
Mr. Serge Marcil (Beauharnois—Salaberry, Lib.): Mr. Speaker,
I would just like to make a comment. We must always pay
attention to what we say, particularly when we know that people
listen to the debates and also read news originating in the House
of Commons. Often we tend to exaggerate the facts.
1550
When the members of the Bloc Quebecois say that there has been
so many cutbacks to employment insurance, that the government has
accumulated a huge surplus to wipe out the deficit, they neglect
to point out to the public that this is the same phenomenon as in
all provinces. This was a period of heavy recession, and all
provinces, the country as well, were heavily in debt. Each
government, therefore, accumulated a larger operating deficit
with every passing year.
In 1993, the deficit was $42 billion. According to the Bloc
Quebecois, the Canadian government should have borrowed still
more money in order to pass it on to the provinces. That is more
or less the mechanics of it. The more our budgets increase, the
more the deficit increases, the more we borrow; the more we
borrow, the more interest we pay on the debt. Asking the federal
government to transfer tax points to the provinces, money to the
provinces, when there is an operating deficit in excess of $42
billion, is like asking it to borrow money on behalf of Canadians
and then give it to the provinces.
So a deficit at one place is increased in order to try to
decrease it at another. When things like this are said, care
needs to be taken.
The second point is that there is still reference to our ranking
25 out of 29 as far as social spending is concerned. I do not
dispute that ranking of 25 out of 29. It refers to social
spending, not the quality of services provided in Canada. The
quality of services provided to Canadians is not what is involved
here. They say Canada ranks 25 out of 29 in terms of social
spending.
When spending in Canada is being considered, all social
spending by the provinces is added in as well, not just federal
spending. It is the total of spending in the country by each
provincial government, plus federal spending, that makes up total
social spending.
Ms. Francine Lalonde: Mr. Speaker, I am pleased to reply to
the member, and I hope he will listen carefully. As they say in
English “I will put his record straight”.
He has just mentioned the recession as a reason for EI cuts. As
it happens, I was my party's EI critic during this period.
We noted that, although this system had had a deficit of only $2
billion, and even though the federal government had pulled out of
funding and active employment measures, responsibilities which
should normally have been assumed by the government, the fund
immediately turned around and started paying for itself.
The truth was that the fund more than paid for itself, because
benefits were cut and the government continued to collect
premiums, knowing full well—and I have been told this by a
senior official who is now with the OECD—what the fiscal impact
of the cuts would be. I said to him “But you did not know how it
would affect people, the regions, the social impact. It does not
make sense that you knew and that you went ahead anyway”. So,
yes, it knew what the tax impact would be.
What is true is that, for other spending, the government
borrowed from the EI fund, which is made up of the contributions
of ordinary citizens and SMBs. That is the truth. This is what
it borrowed from.
As for social spending, Canada ranks 25 out of 29 OECD
countries. This includes provincial spending and that is why I
mention this. When the government cuts transfers to the
provinces, this has an impact on all social spending, including
that of the provinces. I am not interested in hearing that there
can be differences like those among all the countries in Europe,
which are the world leaders, and that Canada, which is in 25th
position, could aspire to the same quality.
When it comes to social spending, we know that quality resides
not just in equipment, but in people in all the forms of
assistance, and the duration of assistance. Take a look at the
duration of unemployment insurance benefits in Europe.
So, I am sorry but, through this policy, Canada has completely
and significantly altered the Canadian values he is talking
about.
1555
Mr. Mario Laframboise (Argenteuil—Papineau—Mirabel, BQ): Mr.
Speaker, I am happy to speak to my colleague's motion. According
to this motion, the government should call a federal-provincial
first ministers' conference to discuss the federal government's
surpluses and a possible transfer of tax points.
It was practically unbelievable to hear members, such as the
Liberal member for Beauharnois—Salaberry, mention in the House
that there were deficits and that is why the federal
government must no longer transfer tax points to provinces, when
we have surpluses coming out of our ears. The federal government
has $19 billion in surpluses.
I am proud of my Bloc Quebecois colleague—duly recognized by
the member for Markham—who, on this day last year, estimated to
within 2% the surpluses forecast by the Minister of Finance.
Again, my colleague is announcing that next year the federal
surpluses will still be $19 billion. I tend to believe him more
than any other member in the House. He was the only one, and I
thank him, to tell all Quebecers and all Canadians about the
financial situation of the federal government.
I consider most timely his motion that the government should
call a federal-provincial first ministers' conference to discuss
the federal surpluses of billions of dollars and a possible
transfer of tax points to the provinces, which certainly need
them, for a very simple reason.
For all those Quebecers who are listening today, I say our
quality of life is provided to us by the provinces and their
various entities, including the municipalities. Here is what I
mean by that.
Health is the main factor that contributes to a person's quality
of life, and health services are provided by the provincial
government. The same goes for education. We all want our young
people to have a good education so they can succeed in life, and
education is a provincial responsibility.
There is also public safety; we all want to feel safe. There is
water quality, water treatment, household garbage collection and
disposal, these are all services provided by municipalities, as
well as transportation. These factors that contribute to the
quality of life of all Quebecers and Canadians depend on services
provided by the provinces and municipalities, their entities.
That quality of life has been severely compromised. Let us all
remember the year 1992. That is when the federal government
decided to make the most drastic cuts to transfers to provinces
in Canadian history. In 1984, these transfers were at 23%; in
1993, they were at about 20%. They were cut by nine percentage
points over six years before going back up slightly. Now, about
14% of Quebec spending comes from federal transfers. But let us
not forget that when the health system was put in place, the
federal government paid 50% of the cost. Now, it is down to just
14%.
It is important that we all remember the year 1992, the year
when, perhaps to eliminate the accumulated deficit, the federal
government decided to make drastic cuts in transfers to
provinces.
It is only fitting that we should be debating my colleague's
motion today, at a time when the government will rake in, year
in and year out, a $19 billion surplus. The Canadian government
should convene the premiers to discuss the federal surpluses and
to transfer tax points to improve the quality of life of
Quebecers and Canadians.
We should never forget that by 2008 health spending will have
doubled in Quebec, from $10 billion today to $20 billion.
1600
Health and education will take up over 45% of the provincial
budget. If that is true in Quebec, it will be the same in all
Canadian provinces.
We should understand that since 1992, the federal government has
withdrawn some of its support to try to erase its huge
accumulated deficit. This withdrawal had a domino effect in the
provinces.
Since 1992, they had to make cuts in health, education and
transfers to municipalities. I am well aware of this because I
was in municipal politics. Until last year, I was president of
the Union des municipalités du Québec.
Prior to 1992, none or very few of Quebec's municipalities
submitted applications to the federal government. They always
managed to reach agreement with the government of Quebec.
With the cuts in federal transfers to the provinces since 1992,
a crisis has developed in Quebec involving the municipalities and
the government of Quebec. In the past few months, without any
reason, and even though the municipalities are the creatures of
the government of Quebec, we have heard statements made by
ministers outside the House and even in the House that
consideration should be given to amending the Canadian
constitution so that money may be transferred to the
municipalities. This is rich.
The federal government is not even capable of transferring
the proper amounts to the provincial governments in order to
resolve education and health care problems, and it is prepared,
for purely political reasons, to transfer funds and consider
amending the constitution in order to transfer funds to
municipalities to help them settle their problems. Prior to 1992,
they had no problem, they could deal with provinces one on one.
Now, because of the cuts to transfers and because provinces have had
to put most of the money they could get hold of into health and
education, which are major expenses, over 45% of Quebec's
budget and, because of the federal government's drastic cuts in
transfers to the provinces, they barely manage to maintain the
portion the federal government could send them. Some of the small
increases are nothing more than what they were getting before in
federal subsidies to keep up with the cost of spending in each
of these sectors. But the federal government still maintains its
share of approximately 14% of all spending on health care and
education and other public services. The federal government pays
only 13.9% of spending on all these services in the provinces.
As far as I know, we pay 50% of our taxes to the federal
government. What does it do with our taxes? Simple.
It is maintaining an old age security system that has hardly been
indexed. The government has not even been able to index the old
age security system to the cost of living. But it is keeping an
army. In Saint-Jean, Quebec, they closed a military base. In
Quebec, we have the army, but they are closing military bases.
With respect to airports, we have discussed in the past, here in
the House, the developments at the Mirabel and Dorval airports in
Quebec, the transfer of flights from Quebec to Toronto. This is a
federal decision. This is what the federal government is doing
with Quebecers' money.
I can talk about research and development, because I come from
the Outaouais region. There are 50 research and development
centres in eastern Ontario. Until last year, we had one on the
Quebec side in the Outaouais; the government shut it down. This is what the
federal government is doing with Quebecers' money. It has decided
to spend money on economic development.
In conclusion, in the transportation area in the last two years,
$10 million out of the whole budget was spent in Quebec. We are
talking about road infrastructures, with an annual budget of $100
million. Only $10 million was spent in Quebec. Elsewhere in
Canada, over 50% of the budget was spent in the maritime
provinces to help Liberals win the last election.
These are always political decisions that go against Quebec's
interests. I hope that Quebecers will have understood that since
1992 it is Canada, through the most drastic cuts in its history,
that has hurt the most the health and education systems of
Quebec.
1605
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker,
the Liberal member for Beauharnois—Salaberry said that we were
in a recession and that this is why the federal government had
been forced to rob the provinces and the employment insurance
fund.
Could my colleague tell us when the last recession ended?
Could he also tell us whether, since then, the surpluses from the
employment insurance fund have been used to eliminate the deficit
or to increase the surpluses of the Minister of Finance?
Mr. Mario Laframboise: Mr. Speaker, I thank the hon. member
for his question. We all know that the last economic recession
ended several years ago. We hope that there will not be another
one.
The last recession ended in 1987. Since then, the surpluses
from the employment insurance fund have belonged to the workers
of Quebec and Canada.
The EI fund has been an independent fund since 1996.
Contributions are made directly by employers and employees. The
federal government no longer makes any contribution. This is
quite something, considering that out of the $19 billion in
surpluses, my colleague estimates that $7.5 billion comes from
the employment insurance fund.
Under the bill that was recently passed by the House to amend the
Employment Insurance Act, the government will directly
appropriate the $7.5 billion that belonged to the workers and
employers of Quebec and Canada.
That money allows the government to boast, declare surpluses and
profits and unilaterally decide to reduce the debt.
As regards employment insurance, the Bloc Quebecois has always
held the same position in the House: let workers and employers
discuss and decide what they will do with an insurance plan to
which they contributed for their own benefit.
Let these people discuss the issue among themselves. As for the
rest of the surpluses, let us give a chance to the provincial
premiers, as my colleague suggested, to get together and discuss
the future of the huge surpluses that my colleague estimated so
accurately once again.
Ms. Francine Lalonde (Mercier, BQ): Mr. Speaker, I would like
to ask my colleague if he believes that when Jean Charest is
campaigning in favour of repatriating tax points to Quebec, it
is because he is in favour of sovereignty?
Mr. Mario Laframboise: Mr. Speaker, of course we are not stupid.
Tax points have been a longstanding claim in Quebec. I will not
reiterate all the statements made by my colleagues in the House.
It is an historical issue.
The province of Quebec is asking for tax points for all kinds of
historical reasons, and one in particular that Quebecers and
people in other provinces will understand. It is because the
quality of life is ensured by the provinces. Health care,
education, everything we can think about, such as public safety,
national safety, water, water treatment, garbage collection, all
these services are provided by the provinces and their
creatures, the municipalities.
There is a reason why the provinces are asking for their fair
share, to assure the quality of life of the citizens of Quebec
and Canada. To answer my colleague's question, there is a reason
why, like his predecessors, the leader of the opposition in the
Quebec national assembly is also asking the federal government
to transfer to the provinces the tax points they deserve in
order to meet their ever increasing expenses.
I repeat that in Quebec health care expenses will double by
2008. The same will happen in every other Canadian province. New
technologies are extremely expensive. When the system was put in
place the federal government paid 50% of the expenses and,
today, it only pays 14%. This is the harsh reality of being part
of a federal system.
I will answer the member for Markham that I believe he is
becoming machiavellian with all the things he is dreaming up
against Canadian unity. They are showing daily that Canada is
less and less united. It is with reactions like the member for
Markham's that people in Canada will understand that trying to
bleed the provinces to death is not a solution, because they are
the ones who are providing services ensuring the quality of life
of their citizens.
1610
[English]
Mr. John McKay (Scarborough East, Lib.): Mr. Speaker, I
will be splitting my time with the hon. member for
Waterloo—Wellington.
This debate is like Yogi Berra saying déjà vu all over again. We
do seem to be going at this once again. The provincial premiers
meet in Saskatchewan and their surrogates coincidentally rise up
in the House in order to bash the federal government for not
giving them enough money. Some tunes never change.
The problem for the party opposite is that no amount of money
will ever be enough. No amount of cash, no amount of tax points
and no amount of equalization payments will ever be enough for
the sponsors of this motion.
If the premiers had their way, Canada would become a collection
of independent principalities and the Prime Minister would be
nothing more than a bill collector. He would be in the rather
unenviable position of having to phone up a Mike Harris or a
Bernard Landry in order to get enough money to cover the expenses
for the army. By that time, of course, in their generosity it
would probably look like nothing more than a glorified police
force.
The facts, however, are somewhat less prosaic. Provincial
revenues in the fiscal year 1999-2000 totalled $181 billion, as
opposed to the federal government's share of revenues which was
$161 billion. Provincial revenues for the past 25 years have
exceeded federal revenues regularly and consistently. Maybe the
Prime Minister should have a meeting with himself to see if he
can get the revenue flowing the other way.
The provinces do very well in this scheme of loose federalism
and have virtually the same access to revenues as the federal
government. The major transfers from the federal government to
the provinces are through the Canada health and social transfer
in the form of tax points and cash.
Generally at this point eyes begin to glaze over because
Canadians, and indeed I would suspect many members, do not
understand tax points. I have some sympathy in this regard.
The definition of a tax point is room given by the federal
government to the provincial governments in the tax system. The
federal government reduces its rate by a certain percentage in
order to give provincial governments room to increase theirs
accordingly. The tax point transfers make no difference to the
overall burden on taxpayers. It is in fact a break even
situation for all taxpayers. The provinces increase their tax
base at the expense of the federal government and presumably in
Saskatchewan that is exactly what the premiers are trying to do.
Tax points are one of the means of transferring revenues to the
provinces based upon the strength of their provincial economies.
If, for instance, Ontario does well, the revenue from tax points
will go up and the money will come into the federal treasury from
the provincial taxpayer. It does a U-turn and heads directly
back to the provincial treasury. The federal government merely
acts as a collector of those funds.
Throughout the dark period of federal fiscal difficulties, the
tax points remained sacred. There was no reduction and there was
no change. Whatever the economy of the province generated, it
immediately went back to the provincial treasury. It is a very
simple system.
The Bloc is in the unique position of arguing that tax points do
not exist, but if they do exist then they want more. The head
office in Quebec City has dictated today's motion, which reads:
That, in the opinion of this House, the government should call a
federal-provincial first ministers' conference for the purpose of
reapportioning the tax base among the federal and provincial
governments through the transfer of tax points.
Do we really believe that premiers want to apportion more tax
points to the federal government? Really, and I have some
swampland in Florida.
Then, very handily, the Bloc manages to answer the motion by
setting up Quebec's own commission. It is called the commission
on tax disparity. I am grateful to my colleagues opposite who
see no need for the debate, as they have already prejudged the
issue simply by naming this commission the commission on tax
disparity. What could be more clear? It is always handy to
arrive at one's own conclusion before stating a problem.
1615
In the year 2001-02 the provinces and territories will receive a
total of $34 billion in tax points and cash, $15.7 billion in
points and $18.3 billion in cash. It is anticipated that there
will be a 19% growth in tax points over the next three or four
years.
Last September the federal government committed itself to an
additional cash transfer of $21.1 billion over five years. Having
worked the federal government over for cash in September, it is
now time to work the federal government over for tax points in
May and June. Some would argue that the Prime Minister becomes a
head waiter for the provinces.
If the federal government does not retain some control over the
cash, the provinces would never have any meaningful national
health standards and we would be even further down the road to
absurd levels of devolution.
The Liberal government's policy of transfers to the provinces is
a balanced one. The cash component is large compared to the tax
transfer component. This means that not only does our government
preserve and enforce national standards but the provinces can
rely on stable sources of revenue.
That does not begin to address the equalization program that is
now at an all time high at $10.8 billion of which, by the way,
Quebec receives the lion's share. In the province of Ontario the
CHST accounts for something in the order of 18% to 20% of
provincial revenues. It has remained fairly steady over the
years as Mr. Harris has chosen to reduce his revenue sources by
his commitment to tax cuts in preference to all other
commitments.
Various provincial governments make their own choices about
spending versus tax relief and the federal government has little
say, some would say thankfully, over those choices. It is now a
little hypocritical for the provinces to come along and say that
they need more federal moneys because of their own decisions.
Having worked the so-called CHST cash cow in September, namely
the cash part of the CHST, we are now in May and we are trying to
work the tax points part.
The finance minister has repeatedly said that there is no
financial space for large initiatives. The federal government
debt is still quite enormous even after the $15 billion paydown
this year. The first $40 billion of all federal revenues
immediately goes toward the interest payment on the debt. If we
took away another $34 billion for CHST transfers and cash, and
added in another $11 billion in equalization, we would have
precious little money left over for other programs, such as
direct transfers to Canadians on matters like EI and pensions.
Spending pressures for research and development, for on reserve
aboriginals and for pensions would continue to be enormous in the
short and medium terms.
The provinces do very well in this very devolved federal state.
Their revenues actually exceed the federal government's and their
debts are less than those of the federal government. The
government already transfers over $40 billion to the provinces. I
for one say that enough is enough and I urge hon. members to
reject the motion.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker,
so many outrageous claims have been made that it is hard to know
where to begin and what questions to ask.
I have about 25 questions I could ask my colleague, but first I
want to make a comment. We are not looking for handouts. When the
member says: “The federal government would be transferring tax
points at its own expense”, he has to understand that the federal
government does not exist for its own purposes.
Will the members opposite finally understand that the federal
government does not exist for its own purposes; it is there to
stand up for the people who have elected it and who have agreed
to have it speak on their behalf in this House.
Will the government realize that there are people in Quebec and
in Canada who need health, education or income support services,
but that these services are provided by the provinces under the
constitution itself?
Will it recognize that in the next four years, even with all the
various federal programs mentioned earlier, like the pensions and
also equalization, the federal government will still have
accumulated surpluses of $70 billion to $90 billion?
1620
If the government thinks that there are no problems, it is the
one with a problem. There is a major imbalance. The provinces
have huge responsibilities, particularly in the area of health.
My colleague was saying a little earlier that in eight years
health care needs in Quebec will have doubled and the situation
is the same in other provinces. We do not have the resources to
face that. The resources are here.
If the government does not understand that the federation does
not work that way, with a superior government, with members who
consider themselves superior to others, above everything, above
provinces and above the needs of the population, I think it is
mistaken. Will it understand my point?
All we are asking by this motion is a conference between the
provincial premiers and the Prime Minister of Canada in order to
see what the situation is and where we are heading. The Minister
of Finance has acted in such a hypocritical way in the last
seven years that we have never seen in what state the public
finances really are. Every year it is a surprise. There are
incredible surpluses and everything is going toward the debt.
We are all for reducing the debt, but there is quite a
difference between allocating to the debt part of the surplus
and all of it when the needs of the population are so important.
[English]
Mr. John McKay: Mr. Speaker, my hon. colleague opposite
seems to want to have it both ways. He wants money to be
transferred to provincial revenues and simultaneously he
acknowledges that there is an enormous debt which needs to be
dealt with.
He ignores quite nicely the earlier part of my speech in which I
said that provincial revenues far exceed federal revenues by
something in the order of at least $25 billion. He ignores the
fact that the provinces have virtually the same access to revenue
sources as does the federal government. He also ignores the fact
that the equalization program is one of the few programs that did
not get cut. His province is the major beneficiary of that
program to the detriment, I would argue, in some respects of
other parts of the country. It is probably the equalization
moneys which have grown the most in the past number of years.
We can ignore all of these sorts of things. We can live in this
fantasy world where we want it both ways, but I say to my hon.
colleague opposite that we cannot have it both ways. We do have
a nation. The nation has needs from coast to coast to coast. We
on this side of the House will address those needs in a fair and
balanced fashion.
[Translation]
Mr. Marcel Gagnon (Champlain, BQ): Mr. Speaker, I would like
to make a comment.
I am outraged when I hear what government members are saying.
They make it sound like the collection of revenues is a race
between the federal government and the provinces. The member says
that since the provinces have more revenues than the federal
government, the federal government should not give anything back
to them.
Wait just a minute. Provinces have more revenues but their
responsibilities are greater. They are the ones with
responsibilities, not the federal government.
Did the hon. member compare the provinces' responsibilities with
those of the federal government?
[English]
Mr. John McKay: Mr. Speaker, in some respects I do not
disagree with the hon. gentleman opposite, but he should be aware
of the fact that provincial revenues last year were $181 billion
and federal revenues were $166 billion.
We transferred $34 billion to the provinces. We transferred a
further $11 billion to the provinces to address their legitimate
and real needs and areas of responsibility. I think in some
respects that is balanced. I welcome the member to federalism.
Mr. Lynn Myers (Parliamentary Secretary to Solicitor General
of Canada, Lib.): Mr. Speaker, I enjoyed the debate that has
just taken place, especially when the member for
Saint-Hyacinthe—Bagot argued that the federal government speaks
for itself. In fact the federal government speaks for all
Canadians.
1625
That is the point those sovereignists cannot quite get through
their heads. The member for Champlain mentioned a race and
jurisdictions, but what he neglected to understand and to realize is
that we have jurisdiction under the British North America Act and
under Confederation for certain areas of responsibilities as do
the provinces. We have had a long and glorious history of being
able to work that out through co-operation and flexibility and
the good, sound judgment that has been used over the course of
years.
Be it tax points or outright cash when it comes to provincial
moneys and resources, the federal government is part and parcel
of how the federation works and underscores the commitment of the
Liberal government to make the federation work in a very
meaningful and sound way.
The member for Saint-Hyacinthe—Bagot talked about the finance
minister being hypocritical and how he was stealing from the EI
fund. Unparliamentary or not, both those statements are
absolutely wrong. On the contrary, we have seen the present
finance minister making adjustments by getting rid of the
deficit, paying down the debt and giving balanced tax breaks and
money back for important reinvestment initiatives.
That underscores the commitment of the government to all
provinces and territories in this great country of ours. It
behoves us to think about these things from time to time to bring
us back to clear thinking and balance because that is what the
government has been able to do since 1993.
The motion before us is of some interest, but it is of more
interest to the sovereignists in Quebec City. It is no secret
that Pauline Marois, the finance minister and Premier Landry have
made it a habit in recent months to come hammering once again at
the door of the federal government. All I see are the
sovereignists opposite, the Bloc in this case, being kind of head
waiters for them, simply bringing their plea to Ottawa and almost
acting, unfortunately, as a branch plant of Quebec City for the
separatists and the sovereignists.
That aside, there are some genuinely important issues that we
need to clear up in the debate. For example, we should note that
this has a long history since 1977 when the first tax point
transfer was implemented. There was a new agreement at that time
called established programs financing, EPF. It helped with
education and health in those days. At that time $13.5 billion
of personal income tax points were given over to the provinces as
well as $1 billion in corporate tax points. We can see the
beginnings of the federal government assisting in this tax point
area along with cash as well which people always want and
provinces especially.
The thing that I find unacceptable is the fact that the
sovereignists, the Bloc and some of the provinces seem to think
that tax points are not equal to cash, are somehow not as good as
cash, or somehow do not provide the cash required. In reality
tax points are equal to, as good as and similar in that sense to
cash. In German one would say macht nichts aus. It is the
same thing. It is half a dozen of one, six of the other.
We keep giving tax points and cash, but why do we do it? We do
it because we are in a fiscally sound federation. We understand
there are needs that the provinces and territories require,
especially in their areas of jurisdiction. The two that
obviously come to mind very quickly are health and education.
That is why for example in 1996-97 we established the Canada
health and social transfers. That is part of the kind of effort
the government is prepared to make to ensure that we do the right
thing when it comes to our great federation.
1630
I point out that all tax points are resources that flow to the
provinces. No matter which way we want to cut it, dice it or
slice it, the fact remains those are resources to the provinces.
I want to point out too that under the CHST in recent years, the
ceiling was established at $11 billion in 1996. It went up to
$12.5 billion in 1998, and in 1999 an additional $11.5 billion
over five years was added. The CHST cash portion in the year
2000 was $15.7 billion. By the year 2005-06, that will represent
$21 billion, which in straight mathematical terms, is a 35%
increase.
That represents a government commitment to ensure that money,
when we are in a surplus situation, be it tax points or cash, is
transferred in a meaningful way to the provincial and territorial
partners. We do that to ensure that the federation works in a
way that Canadians, wherever they live in this great country,
think is appropriate and right and enjoy the fruits of the
surplus situation.
The tax transfers provide provinces with additional revenue
which increases as a result of economic growth. Those tax
transfers have increased sixfold since 1977-78. That is an
enormous increase and represents the growing flexibility and
ability of the provinces to make sure the transfers are used in
their jurisdictions in a way that makes the most sense for them.
By using a mathematical formula, it is projected to the year
2005-06, that the tax transfers will rise to $18.9 billion, which
represents a 19% increase over that period of time.
I reiterate that this is great news for the provinces and
territories in terms of what we are doing by way of federal
transfers, either points or cash. It underscores the commitment
of our government to ensure that things go along in a manner
consistent with Canadian values.
To recap, it is very important to note that in the year 2001-02,
which we are in now, $34 billion will be transferred under the
CHST. That represents $15.7 billion under tax transfers and
another $18.3 billion in cash, for a total of $34 billion. No
matter which way we look at it, and Canadians understand, this is
a lot of money that our federal government is prepared to give to
the provinces so they can put in place the kinds of resources
that the people in those provincial and territories want, need
and demand.
It is our government commitment to ensure that kind of balanced
approach. Balance, after all, is the key, not twisting it out of
joint in one way or the other. Rather balance it out to have the
flexibility inherent in good programming and sound fiscal
judgment so the Prime Minister, the Minister of Finance and whole
caucus on the Liberal side are able to deliver repeatedly in
these all important areas.
I simply have to shake my head when I look at the motion. Of
course it is Bloc members trying to play games. They are taking
their marching orders as usual from Monsieur Landry and others
who are intent on destroying this great country of ours. However,
they neglect to remember that the country represents solid good
governance and a good economy that has been good for all people
no matter where they live. It has provided employment, good
salaries and good jobs for people. At the end of the day
individuals, families, communities and whole provinces and
territories have benefited as a result.
We should rejoice in that because it is the very essence of what
our government is able to deliver. That is the very essence of
who we are as Canadians, underscoring our values and judgments to
make sure that Canadians wherever they live benefit as a result
of our good, solid judgment.
[Translation]
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker,
we have heard many inaccuracies in what the hon. member opposite
and his colleagues have said since this morning.
First, in terms of tax points transferred during the 1960s and
late 1970s, the principle is the following.
1635
The federal government, mainly during the second world war, had
asked the provinces to give up their jurisdiction over personal
income tax. The provinces, including Quebec, agreed as their
contribution to the war effort.
Under the constitution, which our colleague opposite says he
respects, the federal government should never have had this
jurisdiction. The federal government stole it from the provinces,
because it refused to give it back to them after the war.
As a matter of fact, it was during the 1964 constitutional
conference in Quebec City, between Mr. Pearson and Mr. Lesage,
and the 1977 conference, which was held with all provinces, that
the federal government decided to give back a part of what it had
stolen from provinces, as their contribution to the war effort,
in the area of personal income tax, inheritance tax and corporate
tax. These areas were not under federal jurisdiction.
The hon. member says that constitutional jurisdictions must be
respected, but how does he explain, apart from that, another
undeniable fact? During the last four years, namely since the
federal government has been raking in huge surpluses with other
people's money, it has exponentially multiplied its encroachments
on jurisdictions that are exclusively provincial, like education,
health, early childhood and the family.
Why is it that this member, a federal member, a government
member, cannot understand the facts? He has just talked about
principles that go against the practice of the past four years.
The transfer of tax points during the 1960s and the 1970s was
done as a matter of justice for the provinces, which had
generously accepted to lend a jurisdiction which was exclusively
theirs under the constitution. Will the hon. member, a superior
member of a supposedly superior Canada, understand that?
[English]
Mr. Lynn Myers: Mr. Speaker, we can get into a great
history lesson. We can go back to Sir Robert Borden in 1917 and
talk about the temporary income tax. We can talk about Lester
Pearson and Jean Lesage until we are blue in the face, but the
reality remains, despite the member opposite not seeing it nor
would he ever want to, the government does not step in on other
jurisdictions.
The government has a solid, sound record of respecting other
jurisdictions; Quebec, Ontario, Alberta, British Columbia, I can
name any and we respect them. We make sure the divisions of
power are inherent, unlike the Bloc members opposite who want to
rip apart the federation. They want to destroy the jurisdiction.
They want to keep chipping away every time and every way they can
to bring Canada down yet another notch.
There are those on this side and most Canadians, including
Quebecers, who will have no part of that. They want to get with
other things such as providing food, shelter and clothing for
their children. They want to get with the business of carving
out good lives for themselves, whether they live in Baie-Comeau,
St. John's, Newfoundland or Victoria.
Canadians wherever they live respect the integrity of the
government's ability to put us on a sound fiscal good judgment
basis, and as a result provide good government and in the process
give the tax points and cash transfers required for the provinces
to carry out their jurisdictional responsibilities in areas like
the environment, health and education.
With all due respect to everyone involved, the beauty of this
great federation is our ability to manage, be flexible and do the
kinds of things Canadians want, wherever they live in this great
country, a country that others in the world respect and say is
second to none. That is what we do on a constant basis. Why do
we do it? We do it for our families, our neighbours, our
communities and our country. At the end of the day that is
precisely what Canadians want.
We can go off on tangents all we want in terms of too much power
here or too much power there. The reality is, the federation has
proven itself time and time again to work and work effectively.
Is it perfect? No one ever said it was. Is it right all the
time? No one ever argued it was. The reality is, this is a
federation second to none in the world, worth celebrating, worth
boasting about and worth defending. This side of the House will
do it every time.
1640
Mr. James Moore (Port Moody—Coquitlam—Port Coquitlam,
Canadian Alliance): Mr. Speaker, the hon. member from
Waterloo—Wellington repeatedly said the government routinely
showed sound, fiscal, good judgement.
In my constituency there are over 10,000 people, almost 10% of
my constituents, who are living in leaking and rotting homes. The
Barrett commission travelled around the province for months and
recommended that the federal government not tax and profit off of
people losing their homes.
Is it good, sound, fiscal judgment and compassion for the
federal government, the squishy Liberals who this member likes to
represent, to be profiting from the misery of people and the
destruction of their homes?
Mr. Lynn Myers: Mr. Speaker, the issue that is noted by the
member is a very tricky and delicate issue. We on this side of
the House are looking at ways to assist in this very problematic
area. We understand.
I want to go back to the issue of tax points and tax credits.
The member's party opposite would give up the store. If we read
its election platform, that party would give it all away to the
provinces. It would have Canada reduced to a shell. Those
members want provincial jurisdiction in everything, and that is
unfortunate. Canadians have and will continue to reject that.
[Translation]
Mr. Marcel Gagnon (Champlain, BQ): Mr. Speaker, I would like
to briefly congratulate the member for Saint-Hyacinthe—Bagot for
raising such an interesting and important topic.
The future—we are talking mainly about the present—of this
federation, which the members opposite think handles finances so
well, is shaky. The money collected by the federal government
must be redistributed to the provinces, which are responsible for
health, education and municipalities. These are responsibilities
of the provinces and of Quebec.
But the federal government keeps on building up its surplus and
distributing the money to the rich rather than giving it back to
the provinces. I say that it is distributing it to the rich
because, when it uses the surplus to pay down the debt too
quickly, this is not money that goes to the poor, but money that
goes to the rich. When the surplus is used to lower taxes, as
was done last fall, this is money that has been taken away from
the least well off, taxpayers, and redistributed to the richest
members of society.
Last year, following the mini budget, which became the main
budget, I had my accountant do two calculations for me. I wanted
to know what two 35 year old men, one earning $33,000 a year and
one earning $100,000 a year, would save in taxes as a result of
the new budget. The man earning $33,000 a year saved
approximately $300 annually in taxes. The one earning $100,000 a
year, or three times more, saved seven times more in taxes,
around $2,000.
If that is a fair distribution of money in a society that claims
to look out for the poor, that says it wants to help low wage
earners, some questions are in order. When members opposite say
that they are right to take pride in how they are running this
country, I have my concerns.
When the federal government takes $36 billion out of the EI fund
and gives people to understand that the money belongs to it, we
should be worried.
1645
The employment insurance fund is paid into by workers, and also
in part by employers. I have been an employer. What do
employers do when setting salaries, when looking at the payroll a
company can pay out? They take salaries plus benefits, plus the
employer's portion of payments.
In the long run, employment insurance is entirely paid by the
workers, because if there were no employment insurance, they
would be paid a little more.
When I hear justifications like the one provided earlier in
response to the hon. member for Saint-Hyacinthe—Bagot, whereby
talking about grab in reference to the employment insurance fund
is misleading the public, I disagree. In my opinion, that is a
precise and accurate description of what the government has done.
The money paid into it by the low wage earners has been used to
build up a surplus. Year after year, this continues to be done,
at the rate of some $6 billion yearly.
A worker who has trouble making ends meet sees part of his pay
taken regularly to be added to the federal government's surplus
and distributed later to those least in need of it.
The motion being discussed today is one that relates to respect
and honesty. As long as Quebec is part of this system, it is
normal for part of the taxes we pay to the federal government to
come back to us to help us—Quebec and the other provinces too,
it is true—to deliver the services provided by the government of
Quebec and the governments of the other provinces.
Education is a provincial area of jurisdiction. Health is a
provincial area of jurisdiction. The municipalities are a
provincial jurisdiction. So now we see the federal government
giving some money back. They are congratulating themselves
because, within a few days of the last election, an agreement was
reached in the health field.
But what was the cost of this negotiation? How much did it cost
in terms of time and energy? What progress has been made?
Did we get what the federal government was supposed to be giving
us in the area of health care? No. We have figures that show that
the federal government is now paying about 14 cents for each
dollar spent in the health care area.
As far as I am concerned, this is a debate that should not even
be taking place. People say that the federation is working
properly. The member for Saint-Hyacinthe—Bagot has just said
that, in the beginning, in the federal system, the tax points
belonged to the provinces. If we have made our contribution to
the war effort, and if all the provinces have done so, the tax
points should be given back.
This has not been done so that, every year, regularly, people
would have to come here to get what is owed to them, and to get
it the way the federal government agrees to give it to them.
I will give an example. In the area of education, the government
decided to set up the millennium scholarship fund. This is
unbelievable. Roughly $2 billion has been put into this fund, in
an area that is not under federal jurisdiction but rather under
provincial jurisdiction. Moreover, the government has asked
unelected people to manage the fund and it found a way, ignoring
provincial responsibilities, to give out scholarships, when we
had very good scholarship programs in Quebec. It could simply
have given the money to the Quebec government, which is
responsible for education.
But no, it found a way to ignore provincial responsibilities. It
found a way to play petty politics. It found a way to interfere
in areas under provincial jurisdiction, to play petty politics
with money that belongs to the provinces. It is even going one
step further in Quebec, right now.
1650
It has money to give out, but only in exchange for flags. Our
money must be used to promote Canada. This is an absurd
situation, and it is the same everywhere.
We recently had a debate on the subject. We saw that getting
money from the federal government is tied to distributing flags.
Personally—
An hon. member: It comes from Canada.
Mr. Marcel Gagnon: Mr. Speaker, if madam wishes to speak, she
may do so when I am done, but I would like to conclude my
remarks. I have things to say.
The hon. member will know that, if I came back to politics, it
was to say what I just said as often as possible. In the end, I
think that we will convince people that it is in Quebec that such
problems will be resolved.
Some hon. members: Oh, oh.
The Deputy Speaker: Order, please. I hesitate to interrupt the
hon. member, but it is not for a commercial.
It is my duty, pursuant to Standing Order 38, to inform the
House that the question to be raised tonight at the time of
adjournment is as follows: the hon. member for Esquimalt—Juan de
Fuca, Health.
Mr. Marcel Gagnon: Mr. Speaker, thank you for giving me the
floor again, but not for interrupting me. Once one has begun to
speak, it would be nice to be able to go on uninterrupted.
I was speaking about provincial jurisdictions. To exercise their
responsibilities, the provinces need money, particularly the
money which we send to the federal government and which should
come back to us. If there were any semblance of political decency
here, we would not need a motion such as this one. This
reapportionment should be done as a matter of fact. When there
are surpluses at the federal level, they should go back to the
provinces.
One member opposite said that the federal government is assuming
its responsibilities. Let me tell him something. As far as the
environment goes, things are not pretty in Quebec, because the
federal government just does not assume its responsibilities.
Right now, we are trying to have clean up Lac Saint-Pierre, which
has been polluted by Canadian army shells. This is under federal
jurisdiction. We have been asking for this clean-up for years,
but to no avail.
We want to solve the problem along the shores of the St.
Lawrence, which are being eroded. Land is being lost to erosion
because of transportation. This is under federal jurisdiction,
but nothing is being done.
The groundwater in Shannon, in La Baie and in Sept-Îles has been
polluted. That is also under federal jurisdiction, but it will
have to wait. The federal government likes to order studies, but
it does not implement the recommendations. It says the problems
have been taken care of because it has decided to distribute
bottled water, and we should just forget about groundwater.
One of the federal government's responsibilities is to give back
the money to the provinces for education, for health and for
municipalities. We must stop having to beg on our knees, having
to distribute flags to receive a part of the money that is
rightfully ours.
I say to Quebecers that, with respect to the $33 billion in
taxes that we pay to the federal government, I hope this problem
will be solved as quickly as possible. In the meantime, out of
this $33 billion federal surplus, some money must be given back
to us.
1655
I think that today's debate, which is aimed at getting together
the 10 provincial premiers and the federal Prime Minister to
discuss tax points once again, is extremely important.
As for justice and honesty, an hon. member, who is a
knowledgeable economist, said earlier that the Bloc Quebecois'
discussion about this motion will diminish the value of the
federal government for the provinces. If the importance of the
federal government is diminished, it is not because of a motion
such as this one, it is because of the government's behaviour.
If Quebecers find more and more that Quebec has less and less
space and that its future is increasingly doomed here in Ottawa,
it is not because of the discussion that we are proposing today.
Rather, it is because of the way the federal government has
worked and continues to work.
Let us not forget that when we began talking about sovereignty
for Quebec, about 20% of Quebecers were considering that option.
We never lost any ground. At the last referendum, 49.4% of
Quebecers voted in favour of sovereignty. Had it not been for the
money spent in violation of Quebec's laws to bring people to
Montreal to tell us how much they loved us, support for
sovereignty would have exceeded 50%.
Quebec never wavered in its desire to stop begging, as we are
doing, for the money that is owed to us. Quebec knows that
someday, and that day is closer than some might think, we will
exceed 50% and we will settle our issues among ourselves,
because this is how it should be done in the future.
It is not the motion presented by the Bloc Quebecois today that
makes me say this. It is a logical conclusion, it is the way to
go for a people that will then fulfil its dream.
In the meantime, it would in the best interests of the federal
government to discuss today's motion, to call a
federal-provincial first ministers' conference and to look at the
possibility of reapportioning tax points.
It is not only the nasty PQ and BQ members who are asking that,
but also the leader of the opposition in Quebec. All the Quebec
governments, regardless of their allegiance, have always asked
to recover these tax points so as to not be forced to beg and
kowtow to get money for health, education, municipalities and
everything that comes under Quebec's jurisdiction.
Hon. Diane Marleau (Sudbury, Lib.): Mr. Speaker, what
blackmail. It is really something to hear that.
I think the Bloc Quebecois is the one involved in petty
politics. I have sat in this House for a long time. I recall
the time we had large deficits. While we had them the Bloc
members, the sovereignists, said “We have to leave this country
because it is not working. You can see it is not working”.
Today we have surpluses. Things are very different. The
surplus belongs to them. What blackmail. We should not repay
our debt, we should send all the money to Quebec.
I am sorry, but I have always thought that when we repaid our
debt we would avoid a lot of interest over the long term. We will
have a lot more manoeuvring room than what we had before if we
can pay the debt. Let us not forget there are tax points and
cash transfers. We are maintaining a balance.
1700
The tax points do not have the same value in each province. A
balance must be struck. It is also important to be able to
defend the things Canadians hold dear, such as the Canada Health
Act.
We will continue to work with the provinces, despite the Bloc
Quebecois' blackmail. It is always the same thing. When it is a
matter of tax points, it is very important. However, when it
suddenly is a matter of transfers to the provinces, they forget
the tax points. Cash is the only subject of discussion. They
say, “we have enough”. They play little games. It is not
playing these little games.
If we sit down together and work, we can do extraordinary
things. We did it when we balanced the budgets. We have done
this with all Canadians, not just some of them. This is very
important for me.
I want to know why they absolutely do not want the government to
pay the debt. Do they think we will get ahead of ourselves? I
think they are here for one thing alone, and that is to break up
this country. It is not perfect, but it works pretty well.
Mr. Marcel Gagnon: Mr. Speaker, first, the hon. member must
know a lot about blackmail, because the federal government she is
a member of is certainly very apt in this area. It is
blackmailing the people of Quebec with the way it is
allocating the money and the conditions it sets.
Where the debt is concerned, nobody said that we should not pay
it off. We said that we need to seek some balance. We maintain
that the $33 billion the government took from the EI account
should not be used to pay off the debt. That money was paid by
the workers, by only one segment of society, and not by society
at large.
We argue that the money the government is taking from the poor
should not all be spent to pay off the debt, because the debt was
not incurred by the poorest of the poor. We need some balance.
The tax points we are asking for are only what the government
has taken away from the provinces. We only get 14 cents per
dollar for health when a few years back we were getting 50 cents
per dollar. With less and less money, provinces have to find a
way to maintain the health system, while the federal government
uses the money to pay off the debt. It is unfair. We want
balance. The debt has to be paid off, but let us not forget that
there is only one taxpayer.
Mr. Clifford Lincoln (Lac-Saint-Louis, Lib.): Mr. Speaker, I must
say that is a speech I have been hearing ever since I was
elected in 1981 to the Quebec national assembly, of which my
hon. colleague was also a member.
It is as if the same record were played over and over. All the
faults in the world lie with the federal government: it is
monopolistic, it grabs all the tax points, it keeps all the
money in Ottawa, it sends nothing to the provinces et cetera. I
have heard that so many times that a time comes when it feels
like backsliding. It goes on and on.
I want to ask the member a question. The federal government is
grabbing, it is centralizing, it keeps all the money here and it
gives no power to the provinces. What strikes me, as a Quebec
citizen, is that the current Quebec government, which is
responsible for municipalities, has passed the tax bill on to
municipalities a few years ago, without any consultation.
It has fobbed that off to municipalities which had to cope with
it. There were signs in every municipality saying: “We do not
want to take on your debts”. Then it passed the debt on to the
municipalities.
Today, that same government is merging municipalities without
any consultation. It has imposed legislation across the board.
Today, in hospitals under its control, in all the hospital
centres, the legislation has been changed so that members of the
boards of trustees will no longer be elected because they say
that people do not bother to vote.
1705
The government of Quebec will be appointing the board members.
This is the irony of it all. For example, the members of the
board of the Jewish hospital will be appointed by Quebec.
This is what provincial decentralization is all about. It is the
model—
Some hon. members: Oh, oh.
The Deputy Speaker: Order, please. I understand there is a
debate, but I would hope that when one member is speaking, the
others will listen. Their turn will come. When two or three hon.
members are talking at the same time, it is very hard for me to
hear and even harder to understand.
Mr. Clifford Lincoln: Mr. Speaker, I was asking my colleague,
for whom I have much respect—we were together in the national
assembly—if that was the model he wanted, the most centralized
model of all.
We are talking about federal centralization here, about the most
decentralized state in the world, including Switzerland. Is it
the Quebec model that we want, a model that centralizes
municipalities, that centralizes hospital boards since it will
now appoint its members? Before long, everything will be
centralized in Quebec and everything will be conducted by the
government of Quebec.
I prefer this federal model where everything is decentralized
and where we can at least discuss the issue and hon. members can
have their say—
The Deputy Speaker: The hon. member for Champlain has the floor.
Mr. Marcel Gagnon: Mr. Speaker, the member for Lac-Saint-Louis
brings back good memories. Indeed, we had this type of debate in
the national assembly.
If he thinks that I have not changed my tune, I will tell him
that federalism has not changed either. The problems are still
the same. I was talking about how the idea of sovereignty was
gaining ground in Quebec; in 1970, we were at 20%.
When the member was in the national assembly with me, there was
a referendum and we got about 39%. In the last referendum, we
almost won. Why? Because federalism has not evolved.
I remember that a great prime minister supposedly once said, “We
are putting our head on the block to announce that changes will
be made to the federal system if you vote no”. We saw the kind of
changes we got. It was a step back for Quebec. Do not worry,
there is progress toward Quebec sovereignty.
With regard to the Quebec government, personally I am proud of
what it can do, considering the fact that the federal government
has constantly reduced the funding Quebec needed for hospitals,
municipalities, health care and education.
Mr. Dennis Mills (Toronto—Danforth, Lib.): Mr. Speaker, I
appreciate the opportunity to take part in this debate with my
Bloc Quebecois colleagues.
Each time there is a debate with the Bloc Quebecois, I find
myself in a difficult position. I certainly like the spirit and
the passion of Bloc Quebecois members, but I have great
difficulty accepting their ideas. I am a partisan of
centralization and government intervention.
[English]
On this issue today I could not be further away from where the
Bloc Quebecois stands. I come from a city, downtown Toronto,
that every year sends $38 billion to the treasury of Canada.
There is not a day that passes when I do not have municipal
councillors and provincial members of parliament phoning me,
sending letters or calling my office to say they are not getting
their fair share in Toronto.
They say Ontario is not getting its fair share from the national
government. Just the greater Toronto area alone last year
received $38 billion. This is a tremendous sum of money.
1710
I say to my friends in the Bloc that I came to this place
because I believe that this Chamber is to take all the money that
comes from the communities that are doing well, from Toronto,
Vancouver or Alberta, and distribute that money in a fair and
equal manner. We are here to do that so that we can build a
nation.
I believe that it is incumbent upon all of us in the Chamber to
be like the Speaker was at one time, a referee. We are the
referees of that tremendous sum of money that comes to us. We
are here to make sure that if there are special circumstances,
and I do not care which province it is, where there are
difficulties, when remote regions need extra support, whether it
is for infrastructure or for certain unforeseen situations, we
are here to use the treasury of Canada to treat every region of
the country in a fair way.
For me, the notion of further decentralizing the Chamber is just
out of the question. In fact I would say with respect to many of
my own colleagues in the executive of the government, that they
have gone way too far in decentralizing the national government.
I think that at times we have gone further to the right than the
previous prime minister.
If there was ever a moment in time when we needed to rethink the
fiscal framework of the country and the distribution of funds to
the provinces, it is this moment. It should not be evolving
more. It should be reclaiming some of that responsibility. It
should be bringing it back so that we are in a position to reach
out to those people in our communities who are most
disadvantaged.
I have to say to the members opposite and to the esteemed
finance critic of the Bloc Quebecois that in our province right
now we have a provincial premier who is very solid in his
position. We have a very difficult position with affordable
housing. We cannot get our federal-provincial relationship going
in trying to get affordable housing.
All of us in the House announced on March 5 that $500 million
was to go to the farmers of the country. As of this moment that
money has not been distributed because the federal-provincial
agreements have not been worked on and have not been signed.
We as national members of parliament should have a mechanism to
use when the provinces are not co-operating with us in the
national interest, especially where low income Canadians are not
being served. I think we should intervene, we should go direct,
in order to solve those problems. It is for that reason that I
do not think we should devolve any more dollars or tax points
other than what is the basic amount now.
I also want to bring up a very important case for the leader of
the Bloc Quebecois and its finance critic. The hon. member has a
situation right now that exists in his province just outside of
Montreal on the Kahnawake reserve. It is the Mohawk Internet
technology park. The situation there is that our first nations
people are trying desperately to become part of the mainstream
economy. They have hired expert advice and are attempting to
become part of the main economy of Montreal, Quebec. Their own
province is walking away from support.
1715
The Deputy Speaker: Order, please. I am sorry to
interrupt the hon. member but it being 5.15 p.m., pursuant to
order made earlier today, all questions necessary to dispose of
the business of supply are deemed put and a recorded division
deemed requested and deferred until Monday, June 4 at the expiry
of the time provided for government orders.
* * *
[Translation]
MESSAGE FROM THE SENATE
The Deputy Speaker: I have the honour to inform the House
that a message has been received from the Senate informing this
House that the Senate has passed certain bills.
[English]
Mr. Ted White: Mr. Speaker, I rise on a point of order. I
would move that we see the clock as being 5.30 p.m.
The Deputy Speaker: Is that agreed?
Some hon. members: Agreed.
The Deputy Speaker: It being 5.30 p.m. the House will now
proceed to the consideration of private members' business as
listed on today's order paper.
PRIVATE MEMBERS' BUSINESS
[English]
COMPUTER HACKERS
The House resumed from April 6 consideration of the motion.
Mr. Ted White (North Vancouver, Canadian Alliance): Mr.
Speaker, I would like to clarify that one of my colleagues had
seven minutes remaining in his time but I will not be using that
seven minutes. This will be the start of a new segment.
The Deputy Speaker: I wonder if the House might see fit
to extend its co-operation to the Chair. The member for Calgary
Northeast had time remaining on his intervention the first time
this motion was debated. However I have already given the floor
to the member for North Vancouver. If the House sees fit, I will
allow the hon. member for North Vancouver to conclude his remarks
and we would then come back to the member for Calgary Northeast.
Some hon. members: Agreed.
Mr. Ted White: Mr. Speaker, I am glad that was resolved
in an amicable manner.
I should read the motion again so that anybody who has forgotten
exactly what we are discussing here today in terms of the motion
will have their minds refreshed. The motion reads:
That, in the opinion of this House, the government should
immediately amend the Criminal Code to create a separate category
of offences and punishments for computer hackers and persons who
wilfully or maliciously export computer viruses, both of whose
activities disrupt the normal conduct of electronic business in
Canada.
1720
I decided I would join this debate because of an interesting
first hour that was concluded a couple of weeks ago. I noticed
during that debate that the government side at first did not put
up any speakers. It put up a couple of speakers right at the end
and more or less said the whole thing was silly because there
were already areas of the criminal code that dealt with the
issue. Those speakers quoted areas of the criminal code that
were introduced in 1985.
The first thing that struck me was that governments have never
been known for their forward looking legislation. How could it
be that way back in 1985, when a lot of people did not even know
what a computer was, the government had such a far seeing
attitude to legislation that they incorporated something in the
criminal code to take care of computer viruses that would not
appear until the year 2000?
I took a closer look at this and am not quite sure what the
government's motives are. The way the government is approaching
the motion is to say there is no need for it because it can be
covered by the area of the criminal code that deals with
mischief.
What sort of deterrent is it to hackers and people who propagate
viruses on the Internet that they might be prosecuted for
mischief? Even if the penalty, a maximum of 10 years, is
reasonable it does not carry any feeling of deterrence when it is
called mischief. It is mischief to call it mischief.
These are very serious crimes. The fact that the private
members' business committee, which determines whether or not a
motion will be votable, determined that this motion will be
votable indicates to me that the committee considers this a very
serious topic. The government members present, who dominate that
committee, obviously felt there was nothing in the criminal code
that dealt with the issue in enough detail that it should be
dismissed.
We then have the evidence that the member who proposed the
motion gave in his speech. He said that police are frustrated
because they too feel that the present provisions of the criminal
code do not deal with the issue. They are faced with charging
people with mischief instead of charging people with something
that has a much more serious connotation.
I would request that the government take a closer look at the
position it is taking on the issue and at its motives. What are
its motives for not wanting to include something a little more
specific that would act as a deterrent, that could be used by the
police if they were talking to somebody suspected of being
involved in this sort of crime? Instead of simply calling it
mischief, police should be able to tell such people that section
such and such of the criminal code deals with what they are doing
and that they are putting themselves into a position where they
could be subject to prosecution.
All of us who have become used to working on computers over the
last few years would have had some sort of experience with
hacking or computer viruses. I have had experience with both. I
have a computerized database set up between my riding and the
Hill. I do not use Microsoft Access which is the most common
system here. I use a program called Maximizer which co-ordinates
the databases among my riding, my laptop computer and Ottawa.
If I am on a flight from Vancouver to Ottawa I type up my next
report for the North Shore News, a local newspaper. When I
get to Ottawa I simply go to a telephone line and, using dial-up
networking, update my main office in Vancouver with whatever I
have done. That office is called the Superpeer. It updates
Ottawa.
These activities go on all through the day. It happens
automatically every night, but through the day we can force these
updates. At any time I have three complete databases which
contain all the information about all the contacts we have had
with constituents over the years, every letter we have ever
written, every fax we have ever sent and every e-mail we have
ever sent. It is all in these three different places.
Because part of that is done through dial-up networking, some
hacker trying to find phone lines with computers on the end of
them found one of my computers in Vancouver and tried to hack
into our system.
1725
Luckily we had a pretty good firewall set up so no problem was
caused. However the opportunity exists for someone to do it. Our
records from the computer indicate that somebody dialled in a
number of times and spent up to two hours trying to break into
our system.
That is serious. It was not just a passing, spur of the moment
thing that someone did. It was a concerted effort to break in
perhaps without even knowing what computer it was. Presumably
they knew it was a federal government computer because the
telephone number in Vancouver started with 666. Incidentally
many people say that number is appropriate for the federal
government in that 666 is the sign of the devil or the sign of
the beast. They must have known it was a federal government
computer.
That was one experience. Luckily it did not turn out too badly.
However I had another experience. I brought my laptop to the
Hill and connected to the network one day last year before the
last election. Somehow a virus had got into the Library of
Parliament system and it got on to my computer.
At that stage I did not have an updated InocuLAN. We all have
InocuLAN virus detection on our systems, but I did not have the
updated version. The virus ran amok on my computer. It took
about three days to get it rectified. It was very serious. Thank
goodness I had the other two databases in Ottawa and North
Vancouver so that we were able to erase what was on my computer
and start again.
These are serious problems. They are not just mischief. They
are not something that can be covered by the section of the
criminal code that the government spouts, something that was
passed back in 1985, a catch-all phrase to catch little bits and
pieces that might be a problem.
We need a deterrent, something that can be publicized in the
media saying that parliament has passed a law respecting a
certain section of the criminal code so that anyone launching a
virus or attempting to hack into a computer is subject to a
penalty and a fine. To do something more substantial like that
is a much better idea.
On balance we should support the motion. It was made votable
for a good reason. It is tough to get motions and private
members' bills made votable. The member achieved it in this
case. We should support what he is proposing and try to get an
extra line or two into the criminal code.
In closing, I say again that I do not understand the
government's motives. How hard can it be to pop something into
one of the omnibus bills it has coming through here? It could
add an extra line to the criminal code. It does it all the time,
so what is the problem? I hope government members will rise
today and tell us exactly why they have a problem in this regard.
If they cannot come up with a good reason they should be voting
for Motion No. 80.
Mr. Art Hanger (Calgary Northeast, Canadian Alliance): Mr.
Speaker, I was unable to make it here at the appropriate time and
I thank you and the House for providing me this opportunity.
It is my pleasure to debate the private member's motion in the
name of my colleague from Saskatoon—Humboldt. It would create a
separate category of criminal offences for computer hackers or
people who wilfully disrupt the conduct of electronic business in
Canada.
I had a minor introduction to this type of criminal activity for
approximately one year when I was with the Calgary police
department investigating commercial crime. It seemed then like
it was catch up. The electronic media or communications aspect
was growing at such a rate that police agencies across the
country were not on the cutting edge of attempting to curb this
illegal activity.
1730
I believe that is the way it always will be. Communication is
expanding at such a rate that it will always leave the agencies
behind even though they will try to put the necessary resources
into performing their investigations. However the resources
required to conduct investigations into electronic criminal
offences will be horrendous. I believe it would have to
certainly be looked at from a national level. National police
agencies and national agencies of all kinds should and must get
involved to counter it.
Just a few days ago I bought a little instrument called a
BlackBerry. Little did I know just how effective these
instruments were. It is like carrying a computer around with me
everywhere I go. Yes, I feel very high tech right now. It is
strapped to my side. I am afraid to take it off as I might bleed
to death. It really is quite an instrument. I can e-mail to any
computer, definitely in North America, from this very small
hand-held device. I can send and receive messages from the palm
of my hand.
The other intriguing thing about this particular instrument is
that it is a Canadian innovation. It just shows how wireless
communication systems are encroaching upon just about every form
of activity we have. It allows Canadians and others easier
access to one another even though they may be thousands of miles
away, in differing venues or circumstance. Students in Victoria
can research information at a library in Prince Edward Island or
Toronto as easily as they can in their hometown. Seniors can
make daily contact with their grandchildren living at the other
end of the earth for that matter.
Speaking of the BlackBerry, it just went off on my side, so
somebody right now is sending me a message. It is certainly not
within this House, so it could be from almost anywhere. It is
all written text. It is quite a unique device.
This business has been revolutionized to the nth degree. The
speed of this communication certainly is not going to slow down.
The other point that brings focus to electronic endeavours, or
intrigue, is online marketing and the fact that we can bank with
these machines. There is no question that with all of this
access there will be fraud. It just seems more certain than not
that fraudulent activity will take place as the electronic world
develops at a pace that is almost unbelievable.
The Internet has become the essential tool for Canadian
businesses and consumers, so it poses a serious security problem
for all involved. As more and more companies and government
agencies computerize and network confidential databases, the
privacy of Canadians is increasingly put at risk by hackers.
It was not too long ago when I heard that even police
departments and the military had their computers entered
illegally.
It is a very significant concern when we start looking at
confidential security matters. As more Canadians use the
Internet and more businesses collect increasing amounts of
information, the security problems I have pointed out will
increase. That is why this is an area where the government needs
to step in. The current criminal code revisions are simply not
strong enough.
My colleague's motion seeks to have the government introduce a
bill that would provide specific provisions in the criminal code
which police could use to charge people engaged in either hacking
or exporting computer viruses.
1735
I agree with my colleague that the penalty for such acts should
be quite severe. Malicious damage and manipulation of computer
networks and databases should be treated as theft and vandalism.
It is a deliberate attack on someone else's property and a threat
to the privacy of all Canadians. These are serious offences. It
is no different than physically breaking into someone's home or
business and rummaging through their files.
We should do what we can do to ensure that Canadians gain unique
benefits from the Internet, while knowing that there is a
sufficient legal framework in place to protect them from unwanted
intrusions. I urge all hon. members to support Motion No. 80.
The Deputy Speaker: Clearly the House has rules about
props. I am not sure about commercials yet. That is something
we will have to research further.
[Translation]
Mr. Réal Ménard (Hochelaga—Maisonneuve, BQ): Mr. Speaker, I
would like to congratulate the hon. member for
Saskatoon—Humboldt on his private member's motion. Before I deal
with the substance of the motion, I would like to make a comment.
I have read the remarks of the sponsor of the motion. He
reminded us that, besides the debate he wants to initiate on
computer hacking, we need to discuss the private members'
business process. It is not normal that mere chance should
determine how and when members will be able to introduce bills or
motions.
It is a lottery system that determines which business will be
selected for the consideration by the House. The same system
determines also which motions will be made votable.
I think that system has to be reviewed. In fact, we had a debate
in the House on this very issue on a Tuesday night, in April if I
am not mistaken. I hope the House leaders from every party will
examine the issue.
I do not think that the Bloc Quebecois can support this motion
as it stands now. I say this regretfully, because we are always
favourably disposed, in principle, toward private members'
business. That is the opportunity, in the system, to stress
initiative. In spite of what the Parliamentary Secretary to the
Solicitor General may think, we are always favourably disposed,
in principle, toward private members' business.
This is the opportunity, in our parliamentary system, to
encourage members' initiatives and also to distance ourselves,
which is critical, from the executive and Cabinet, which, as we
know, often plays an inordinate role in our parliamentary system.
For purposes of clarity, I would like to reread the motion:
That, in the opinion of this House, the government should
immediately amend the Criminal Code to create a separate category
of offences and punishments for computer hackers and persons who
wilfully or maliciously export computer viruses, both of whose
activities disrupt the normal conduct of electronic business in
Canada.
When I first read the motion, I said to myself that it made
sense. We all know that it would be very hard to live without the
computer nowadays. We also know that a person who has no basic
knowledge of computers and who does not have at least some
ability to surf the Internet will soon be considered illiterate.
New products are related to the computers and these products
have a life cycle of five years. Every five years, new products
are introduced, and we constantly have to adapt.
I would like to remind our viewers that each party leader has
access to some computer facilities. We all know how computers are
an integral part of our ability to do our work as
parliamentarians, and this also holds true for a variety of
sectors in society.
I have asked myself if there is something in the criminal code
to meet the objectives of our colleague, the member for
Saskatoon—Humboldt.
1740
I read section 430 of the criminal code, and I do not understand
how this section, which already exists and can be applied
immediately, will not allow us to achieve the objectives pursued by
the member through his motion, that is, punishing people who use
computers to disrupt electronic business.
When people disrupt electronic business by introducing viruses,
they destroy data banks and a part of the economy, because today
we can pay bills and make business transactions through
computers. With some financial institutions, we can even get
authorized loans. There is a whole area of computer science that
is developing, which is called domatique, and which will ensure
that, as consumers, we will be able, from our homes, to make
transactions that would have been unthinkable a few years ago.
Section 430 provides for an offence system. I remind members
that the criminal code is a legislation. Several times in the
House, we have amended the criminal code. We have amended it to
include aggravating circumstances. Section 718 of the criminal
code says that, when a person is abusing gays, for example, the
judge assessing the case will have to impose a more severe
sentence. This is the heinous crime legislation.
Tuesday, in the standing committee on justice, we considered
each clause of Bill C-24, which provides a framework on the whole
issue of anti-gang legislation.
Clause 24 says that certain offences or helping organized crime
is punishable by 14 years in prison.
I could draw up a fairly long and comprehensive list of the
circumstances for which the lawmaker saw fit to amend the
criminal code. But I believe we should not overdo it. The
criminal code is complex enough as it is, both in terms of its
interpretation and its enforcement. Let us not forget that the
criminal code is a federal act, but that the provinces have to
enforce it.
We want to make it very clear that by taking part in this debate
we will ask members of the Canadian Alliance—those who are
still in it and those who have left—to explain why we need new
provisions. We do not understand why section 430 would not allow
the objectives sought by our colleague from Saskatoon—Humboldt
to be met.
We understand, of course, that economic crimes are often
committed through the Internet. Mafia boy is a case in point. In
an article I read, it is said that the damage caused by this
young computer whiz, who is just over ten years of age, when he
broke in to a number of systems, including those of the FBI, the
CIA and several big American bureaus of investigation, is
estimated at $1.7 billion.
As parliamentarians, we are right not to take this lightly. I
suppose that the Parliamentary Secretary to the Solicitor General
of Canada, who is very vigilant regarding the RCMP's activities,
will remind us that there is within the RCMP a section dealing
with economic crimes committed through Internet and computers.
Again, we understand the hon. member's concerns. There have been
fundamental changes in computers. Computers are no longer for
recreational purposes only, as they were when I started using
them.
We used them to get information, and we used them a lot for
recreational purposes.
1745
Nowadays, many services are linked to economic development.
Major economic players use computers as a matter of course, for
their transactions.
Only last week, I had to get involved. In Quebec, the Mouvement
Desjardins is rationalizing its services and facilities.
Unfortunately, there is a relationship between the fact that
people are relying less on bank tellers and more on computers.
The issue is to maintain jobs.
It makes us realize that computers have permeated many aspects
of our daily lives that we would not have thought possible just
a few years back.
I certainly do not want to give the impression that we are not
aware or mindful of all the ramifications of the various
computer applications. However, we do not believe that a new set
of offences is needed.
We should be able to reach our goals with section 430 of the
criminal code. For all these reasons, we would hope to get more
details on this issue, but unless we get some very convincing
explanations, we will be voting against the motion.
[English]
Mr. Lynn Myers (Parliamentary Secretary to Solicitor General
of Canada, Lib.): Mr. Speaker, I will begin by thanking the
member for Saskatoon—Humboldt for bringing this motion to the
attention of the House. It clearly is an issue of great concern
and certainly is an issue of importance, not only nationally but
internationally as well.
I also want to express my appreciation of the views related to
this issue that have been expressed by a number of members in the
House. For example, the member for Hochelaga—Maisonneuve made
some very important points about the criminal code, mafia boy and
others, some of which I will highlight later in my speech as
well.
It is fair to say that issues relating to cybercrime, such as
hacking and malicious virus dissemination, have been widely
reported over recent months and have caused governments, industry
and the public great deal of concern.
I think it is fair to say too that criminal conduct on the
Internet has grown as the use of the Internet has grown. As we
know, Canadians are in the lead in its use in many instances,
therefore it is important that this and related issues receive
the proper attention of parliament and the government in general.
That being said, I would like to restate the government's
commitment to ensuring that our laws keep pace with technology.
We would like to continue to foster the relationships the
government has created with law enforcement and industry to
ensure that the laws and the tools used to combat cybercrime
fulfil the needs of law enforcement without hampering our
industries' competitive advantage.
Canada continues to be a world leader in the area of battling
cybercrime, crime that in many instances does not respect
borders. We have forged many international partnerships and will
continue our involvement, for example, in the G-8 and the Council
of Europe as well as the United Nations, to name just a few, in
order to combat and deal with these kinds of issues.
The member's motion, although well intentioned, is nonetheless
redundant. He has characterized it as a provision that will fill
a void in Canadian criminal law. I would suggest that in fact
that is not the case. It will not do that because sections 342.1
and 431.1 of the criminal code were designed with the
dissemination of malicious computer viruses in mind. They were
also worded in a manner that could be applicable to some future,
still unknown, form of mischief.
It is a good thing that one of Canada's great legal traditions
is to draft legislation in a general manner so that it fits not a
particular thing but a number of things. In other words, in
Canada fraud is fraud, whether committed by a person or committed
by a computer. We do not need, then, a separate offence to cover
computer fraud.
In that same line of reasoning, a section that was created to
deal with any form of mischief to data, for example, including
computer virus dissemination, should not be overridden simply
because it does not include those words explicitly. Again,
Canada's legal tradition kicks in here in a very fair minded and
actually a forward thinking way.
During the first hour of debate the hon. member for Fundy—Royal
said it best when he stated that the current criminal code is
adequate to deal with computer hackers. He also pointed out that
these serious offences carry a maximum penalty of 10 years
imprisonment. That is already in place. Where the mischief in
question endangers life, the penalty can be life imprisonment.
1750
It is clear from at least the government's point of view, then,
that the criminal code already deals with these types of crimes
in a very serious manner. These provisions have been on the
books for over 15 years and in 1997 were fine tuned and adjusted.
Amendments were made at the time to reflect the realities of the
day. This is demonstrative of the government's ongoing
commitment to update the laws as needed. We continue to do so. I
think that is the strength of the government: to ensure that we
are ahead of the game in these kinds of things.
Although the Minister of Justice agrees with the motion in
principle, she cannot support it because it affects conduct that
already has been contemplated by the criminal code. I know that
her parliamentary secretary agrees with that position.
Justice officials have been working to establish and foster
partnerships with private industry, law enforcement and other
governments. It is our understanding from these sources that the
criminal code adequately deals with the conduct described in the
motion before us. Law enforcement has and will continue to use
these provisions successfully.
We are all aware of the recent mafia boy case to which the
member for Hochelaga—Maisonneuve referred, where the accused was
charged with 64 counts of hacking and mischief. Internationally,
Canada is recognized as a world leader. In a recent independent
international study on the readiness of national law to deal with
cybercrime, McConnell International found that Canada's
cybercrime laws are among the world's strongest. That is worth
celebrating. It is worth it for all of us as parliamentarians to
think about it. Internationally we are well renowned. We are
known throughout the world in terms of having some of the
strongest laws on the books.
Although Canada is a world leader in this regard, the government
is committed to ensuring that our laws speak to our ever changing
technological environment but that at the same time we have due
regard for fundamental human rights. Canada continues its role
as a world leader and as an active participant in many
international forums on the issue of cybercrime. These include,
and I will note them for the record, the G-8, the Council of
Europe, the United Nations, the Commonwealth Secretariat, OECD
and the Organization of American States.
As observers to the Council of Europe, Canadian delegates have
been integral in negotiating a draft convention on cybercrime
that which will be adopted later this year and will stand as a
benchmark for international instruments in this area. Again it
is something of which Canadians, wherever they live, can be
justifiably proud. At the G-8, Canada continues its leadership
role on cybercrime issues and is looking forward to its
presidency in the year 2002. That underscores the leadership
role that the country takes on matters of such grave and
important substance.
Because cybercrime challenges our notions of sovereignty, our
participation in these international forums will require that we
constantly review our legislation, not only to make sure that it
keeps pace with technology but also that it keeps pace with the
laws of our international partners. We need to work together on
this and Canada will take its lead, as it always has, in this
very important area.
In summary, the Minister of Justice is satisfied that the
criminal code already covers the malicious dissemination of
computer viruses and that no further action is required in this
area and with respect to the motion. I would ask all members to
consider that and vote accordingly.
Mr. Larry Spencer (Regina—Lumsden—Lake Centre, Canadian
Alliance): Mr. Speaker, I was deep in thought about what the
member across the way said, however, I am thankful to the member
for Saskatoon—Humboldt for introducing this private member's
motion. I believe every member should support the motion.
I do not believe that the criminal code is sufficient as it is.
It is perhaps outdated regarding Internet crime and I believe it
is yet another symptom of how we are failing to keep up with the
times in having a judicial system that protects Canadians.
Ever since the Internet entered the public domain there has been
an enormous resistance to any regulation or interference by the
government in the Internet.
The Internet is believed by some to be the last bastion of pure
freedom. Some people believed it could not be regulated and some
people want freedom without limits, without consideration for
others and without any accountability. However, freedom does
come with responsibility, with limits, with consideration and
with accountability.
1755
Internet crime has proven to be harmful to personal property and
will even destroy it. My own son's computer contained the files
for my personal website during the election campaign. The night
that he was to go home and finish that campaign site he found
that a hacker had entered his computer and had actually destroyed
the computer itself. He actually had to replace the hard drive
because of the action of that hacker. We know it can happen. We
know that Internet crime can also interrupt business. We believe
it is time to shut down crime.
The Internet came on in the early nineties. It was the gateway
to a new era. It developed so quickly that it seems to have left
a lot of things in its wake. It moved so quickly that technology
was perhaps slow in keeping up with the hackers, in keeping them
out. Also, though, I believe that we were slow in heading them
off.
Moving just as quickly, of course, were those we call hackers,
who were attempting to destroy opportunities. The word virus
took on a new meaning. Those who would destroy the opportunities
and those who would create destructive viruses are the criminals
that the member of parliament from Saskatoon—Humboldt and others
want to shut down through this type of motion.
Existing crime legislation was never designed to deal with the
types of Internet crime we are witnessing. Some of this crime
was never even imagined in those days and it continues to develop
in things that are happening on the Internet.
I believe amendments to the criminal code are required that will
allow it to specifically deal with Internet crime. Amending the
criminal code would provide law enforcement agencies and the
courts with the tools they need.
Many have benefited personally from crimes on the Internet. It
reminds me of the old protection racket in the old west, for
instance, or in the Al Capone days. It seems that one of the
ways to get a good computer job is to learn how to be a good
hacker, to hack into some company's files and then offer oneself
for hire. I do not believe that should even be allowed.
I support those who want to keep the government from unduly
regulating the Internet and I support measures that will secure
the existing network for us and for future users.
However, I believe there are things that we have not even
mentioned and that this bill certainly does not address. I
believe, for instance, that we also ought to look at sites that
would entrap children in pornographic sites. I know this bill
does not address that. That is just an example of how things
progress on the Internet. We should broaden our look at what
might be considered an Internet crime.
I have information here which indicates that by May 10 of this
year the number of viruses tracked by MessageLabs SkyScan virus
scanning service passed 185,000. That exceeds the mark reached
in the whole year of 2000. We are seeing this kind of steady
increase. Another consultant with another firm said “Around a
year ago we would probably expect to see 1,000 new viruses each
month. Nowadays we aren't surprised to see 1,200”.
There have been two major viruses this year, and we all know
about the one last year, the love bug virus. These viruses are
developing very rapidly.
I believe that the laws need to be tough enough to punish those
who would willfully spread computer viruses and those who write
them. We must take the cool out of writing viruses and we must
not allow people to profit from it.
1800
I understand that people who distribute viruses get the code
from a virus exchange website where authors post viral source
codes. This in itself should be illegal. To allow the tools for
writing viruses to be on the Internet seems to me to be quite
comical, but it is happening. If our laws are so sufficient, why
is it continuing to happen? Why are those sites there?
It has been stated that no one is ever shown anything useful
about a computer virus. It is bad and it only does harm and the
law should treat it accordingly. Peter Tippet, a chief
technology officer for TruSecure Corporation, wrote a recent
article in which he says that making a bomb is illegal while
writing about a bomb is not illegal and with a computer virus the
words are the bomb.
Virus writers are glory seekers. They believe they are free in
the wild, wild west of the computer Internet world to do whatever
they want to do. It is time that we introduced some effective
crime legislation to deal with hackers. I am pleased to support
the bill which calls for some important steps to be taken toward
the real control of Internet crime.
Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian
Alliance): Mr. Speaker, it is a pleasure to rise to speak to
the private member's motion that has been put on the agenda by my
colleague from Saskatoon—Humboldt. The motion states:
That, in the opinion of this House, the government should
immediately amend the Criminal Code to create a separate category
of offences and punishments for computer hackers and persons who
wilfully or maliciously export computer viruses, both of whose
activities disrupt the normal conduct of electronic business in
Canada.
There is not one of us in this place who is not aware of the
importance of the Internet and of the new technologies available
to us to allow us to do our job. There is no one in the House
who does not understand the potential of the invasion of a
person's privacy through the new technology that we use.
The industry committee took many hours in looking at the new
e-commerce, the privacy issues and how we protect information
when using this new technology. Companies in society have
created an international environment through the use of the
Internet and the use of new technologies.
My colleague who spoke earlier gave a couple of examples of new
technologies as his phone rang and his BlackBerry warning went
off. These new technologies have become part of how we conduct
ourselves, how we do business, how we communicate with each other
and how we share information immediately. I could write an e-mail
message and send it to someone in Vienna, Austria, who would
receive it immediately. It is a technology that has advanced our
business community. It has allowed that community to be
competitive in the international scheme of things.
When we talk about offences, about people who break into
someone's system or about someone who deliberately plants a virus
that will disrupt a communication tool, we need to have some
vehicle or means of dealing with it.
I do not think we are talking about high school kids who play
around and mischievously plant things in computer systems, but we
are talking about people who, for either their own personal gain
or for a reason more serious than that, deliberately interfere
with the ability of a company to communicate either within its
own company or with others around the world.
1805
I know and have known for a number of years that there has been
a concern within companies about people trying to hack into their
computer systems for malicious reasons, either because they are
disgruntled employees or because they want to remove or destroy
information within the system that might affect them or might
benefit them economically.
We have a whole new range of criminal activity. I call it
criminal activity because people are deliberately, maliciously
and intentionally destroying the abilities of companies,
corporations and banks to use the new technology in the manner it
was designed to be used.
We have to deal with these individuals who are committing
crimes. People have used the analogy of someone who breaks into
a home and rifles through papers, goes through closets and
dressers and gets access to things that he or she has no business
having access to.
When we talk about hacking into a bank, we are talking about the
ability to transfer money, to actually steal assets or to remove
information that clearly defines who those assets belong to.
There are other circumstances as well. Someone who hacks into a
defence equipment file or a police file has access to very
sensitive information. In the police scenario, someone could
destroy the credibility of evidence to be presented in court. In
the defence scenario, someone might get information that is a
risk to the security of the country.
How do we deal with this? Today there is no specific way of
dealing with an individual who is hacking into computer equipment
and programs. To those doing business, the cost of trying to
protect computer networks from outside hackers is incredible.
They are constantly trying to be ahead of technology. Businesses
are constantly trying to figure out how to prevent people from
hacking into their systems. It must be very frustrating for
businesses to have to put these costs into their system and their
budgetary programming knowing that if an individual is caught
hacking into their computer systems, it is questionable whether
or not that individual would face a criminal charge or have any
kind of meaningful sanction.
Then we get into the issue of viruses and their potential to
create the same kind of damage. There it is not stealing
information, accessing or transferring assets or anything of that
nature, but if this is done deliberately to create confusion or
to cause disruption to a company doing business, it should be
considered a very serious criminal action. That also is not
happening because there is nothing in legislation that
specifically sets up the issue for people who create viruses. I
do not think there is a member in the Chamber who does not know
about the effect a virus can have and about the insecurity one
has in dealing with computers knowing all these viruses exist.
1810
I recently bought a new software program that is able to hunt
out viruses when I turn on the computer. It deals with viruses
and removes them from the system. Supposedly the software
program can kill a virus brought in from the outside before it
attacks any information in the system. However, I found out that
I am not protected from any new virus that comes in after the
software program came on the market. How many software virus
programs does a person have to buy? Does a person have to buy
one every day because every day someone is creating a new virus?
We have to consider this concern, as I am sure people are, with
our reliance on new technology such as e-mail, the Internet and
even storing information on computer networks. Certainly here in
the House of Commons we have that concern.
If someone were so creative as to come up with a virus that
would shut down all the systems at the same time, I am not sure
how society or commerce or banking would survive, because we have
become very reliant on computer technology. What about buying
licence plates for my car or buying groceries or doing my
banking? Most people use debit cards in grocery stores,
restaurants or Canadian Tire. Debit cards are tied into a
computer network. I really wonder whether as a society we could
manage to keep operating. Because of our reliance on the new
technology and on the security of the new technology, it is
extremely important that we recognize computer hacking as a
criminal offence and put sanctions on it.
The hon. member for Saskatoon—Humboldt deserves a lot of credit
for taking seriously what he heard as concerns of the industry
committee, the business community and also the medical community.
He is to be commended for hearing their concerns and for
identifying a situation that our criminal code does not deal with
sufficiently.
We should view the motion my hon. colleague has presented to the
House as a positive thing, as something that can at least begin
to address and support the study done by the industry committee.
We need to be very concerned about the privacy, security and
protection of the new technology, of the information highway, of
information systems and of all the different areas of the new
technology that can be interfered with and interrupted and
undermined by a criminal mind.
Mr. Speaker, thank you for the opportunity to support my
colleague. I appreciate his diligence in putting the bill before
the House. I hope that all parties would see the need to support
the legislation and ensure that it at least advances beyond a
private member's motion.
Mr. Larry Bagnell (Yukon, Lib.): Mr. Speaker, as the last
speaker of the day, I can sum up basically the whole debate by
saying that virtually everyone agrees computers are very
important in our society and computer hacking is a terrible
problem. It is the remedy that we need to discuss: whether
section 430 of the criminal code is enough or whether the
government should make additional amendments. That is how people
will vote.
I want to make two points. One is for my constituents and it is
that to have these problems we need to be connected.
I am very glad the Government of Canada in its recent throne
speech put a lot of effort into connecting Canadians. I have
been urging and trying to get the towns of Faro and Ross River
connected. I hope every house in the small Yukon communities of
Beaver Creek, Pelly Crossing, Carcross, Old Crow, Destruction
Bay, Burwash Landing, Elsa and Keena will be connected one day.
1815
Finally, on the day the motion was introduced, the person who
introduced it also introduced something that was not very
unifying. I would like to induce him to perhaps take some
private reflection or remember that softwares are languages on
computers. There are quite a few and they all bring strength to
a computer. If people understand a lot of languages on a
computer then they have more strength.
With respect to the other initiative he brought forward, we want
Canadians to be in the position of strength understanding that
those many languages strengthen Canada. I hope he will reflect
on that.
The Deputy Speaker: The time provided for the
consideration of private members' business has now expired and
the order is dropped to the bottom of the order of precedence on
the order paper.
ADJOURNMENT PROCEEDINGS
[English]
A motion to adjourn the House under Standing Order 38 deemed to
have been moved.
HEALTH
Mr. Keith Martin (Esquimalt—Juan de Fuca, Canadian
Alliance): Mr. Speaker, on April 27 I asked the Minister of
Health a question concerning hepatitis C and why individuals who
were infected outside the 1986-1990 border, who contracted
hepatitis C through no fault of their own through
tainted blood, had not been compensated. The response I
received was that the minister was frustrated.
I bring this up again because people who contracted hepatitis C
through tainted blood do not need frustration. What they need is
leadership. That is what will help them.
Between 1978 and 1986, 14,000 Canadians contracted hepatitis C
through no fault of their own. We have to find out who these
individuals are. Many of them are unknown to the medical
community because the time course for acquiring symptoms can be
more than 10 years. It can even be as much as 40 years before
any symptoms accrue. Some provinces are trying to find out who
these people are, and the federal government ought to help them
in that way.
The number of victims who contracted hepatitis C was
overestimated. There is $1.1 billion available to compensate
victims. Because of the overestimation, there should be a
surplus of money which should go to those individuals who have
not as yet been compensated.
I do not know why the government has not done that. These
people are suffering at home. They do not have the treatment or
the medication they require. They have simply slipped through
the cracks to live their lives in quiet desperation through no
fault of their own.
We all have this problem in our ridings. I am simply asking the
Minister of Health to do the right thing. I am asking the
Minister of Health, while the money is there, to please
compensate those victims who are outside the window of
compensation.
This is an issue of fairness, and the money is there. Rather
than the money being chewed up by lawyers' fees, because these
people are bringing cases to the court, why not make sure it goes
to the patients for the care and medication they require.
I also would like to draw to the attention of the members that
the number of people who are contracting hepatitis C is
increasing because of the explosion of intravenous drug use. We
also know that people who snort cocaine through the use of shared
straws can contract the hepatitis C virus if they have open
sores. This is important for the public to recognize.
1820
In closing, on behalf of the 14,000 plus individuals who
contracted hepatitis C through tainted blood that was not checked
by tests that were available at the time and as a matter of
fairness and compassion to those individuals, I plead with the
government to compensate those individuals so they will have
the treatment and medial care they require. It is a simple
request. It is simple to do, and I hope the government does it
as soon as possible.
Mr. Lynn Myers (Parliamentary Secretary to Solicitor General
of Canada, Lib.): Mr. Speaker, in March 1998 the federal,
provincial and territorial governments agreed to offer
compensation to Canadians who were tragically infected with
hepatitis C through the Canadian blood system between January 1,
1986 and July 1, 1990.
Governments and lawyers for the class action plaintiffs reached
a proposed settlement agreement and filed it with the three class
action courts in June 1999. The settlement was approved by the
courts in December 1999. It was recognized that the settlement
was fair and equitable.
Since the court appointment in March 2000 of Crawford Expertises
Canada Inc. and The Garden City Group as the arm's length
administrator, Crawford has developed claims protocols and has
had these protocols approved by the courts. Crawford has received
and reviewed more than 5,000 claims and, since June 25, 2000,
more than 2,000 individuals have received compensation.
The joint committee, a group of lawyers appointed by the courts
to supervise the administration of the settlement agreement, has
assured the Minister of Health recently that they are taking
every available step to review claims efficiently and promptly.
The government's plans to assist people living with hepatitis C
are not limited to the settlement compensation. Following the
compensation announcement in March 1999, the Government of Canada
received representation from individuals infected outside the
window period. The Minister of Health listened to their concerns
and as a result, in September 1998 a $525 million strategy was
announced to assist all individuals infected with hepatitis C.
As part of this proposal, the government is transferring to the
provinces and territories up to $300 million to ensure that all
those who contracted hepatitis C through the blood system, no
matter when, will have reasonable and ongoing access to the
medical goods and services needed for appropriate treatment. The
government has demonstrated care and compassion toward all
victims. This stands as proof in that respect.
Health Canada was proud to be the sponsor of a national
conference for hepatitis C which took place May 1 to May 4 in
Montreal this past little while. This conference brought
together all stakeholders to share their experience and knowledge
of recent medical developments and strategies for disease
prevention and control along with health promotion in community
support.
It is my contention, and I believe people will agree, that the
government is doing everything it can for the victims of
hepatitis C.
[Translation]
The Deputy Speaker: The motion to adjourn the House is now
deemed to have been adopted. Accordingly, this House stands
adjourned until tomorrow at 10 a.m., pursuant to Standing Order 24.
(The House adjourned at 6.23 p.m.)