House Publications

The Debates are the report—transcribed, edited, and corrected—of what is said in the House. The Journals are the official record of the decisions and other transactions of the House. The Order Paper and Notice Paper contains the listing of all items that may be brought forward on a particular sitting day, and notices for upcoming items.

For an advanced search, use Publication Search tool.

If you have any questions or comments regarding the accessibility of this publication, please contact us at accessible@parl.gc.ca.

Previous day publication Next day publication

PDF

Friday, April 18, 1997

PRIVILEGE

PRIVATE MEMBERS' BUSINESS

9919

GOVERNMENT ORDERS

INCOME TAX BUDGET AMENDMENTS ACT, 1996

9920

9923

STATEMENTS BY MEMBERS

ORAL QUESTION PERIOD

LINGUISTIC SCHOOL BOARDS

9931

9932

IMMIGRATION

9932

TOBACCO

9932

9933

PAY EQUITY

9933

9934

GOVERNMENT EXPENDITURES

9934

SATELLITE DISHES

9934

9935

TAXATION

9935

CANADIAN CULTURAL INSTITUTIONS

9935

9936

INTEREST RATES

9936

AGRICULTURE

9936

9937

CULTURE

9937

TAXATION

9937

9938

PEACEKEEPING

9938

TAXATION

9938

THE LIBERALS

9938

POVERTY

9939

INFRASTRUCTURE

9939

ROUTINE PROCEEDINGS

PETITIONS

NATIONAL HIGHWAY SYSTEM

9939

RIGHTS OF PARENTS

9939

EXCISE TAX

9940

NATIONAL HIGHWAY SYSTEM

9940

HOUSING

9940

NATIONAL HIGHWAY SYSTEM

9940

SAFETY OFFICERS COMPENSATION FUND

9940

TAXATION

9940

QUESTIONS ON THE ORDER PAPER

9940

GOVERNMENT ORDERS

INCOME TAX BUDGET AMENDMENTS ACT, 1996

CRIMINAL CODE

9955

9958

9959

9919

HOUSE OF COMMONS

Friday, April 18, 1997

The House met at 10 a.m.

_______________

Prayers

_______________

[English]

The Speaker: Order. I have notice of a question of privilege from the hon. member for Sarnia-Lambton and I propose to hear that before we proceed with any other business.

* * *

PRIVILEGE

PRIVATE MEMBERS' BUSINESS

Mr. Roger Gallaway (SarniaLambton, Lib.): Mr. Speaker, I rise this morning on a question of privilege concerning the cancellation of private members' hour today.

I learned yesterday afternoon that the member for Vancouver North, whose motion appeared at position number one for today, had notified the office of Private Members' Business that he would not be appearing. I spoke with the hon. member this morning and in fact he had notified that office at the opening hour, 9 a.m. yesterday morning.

Prior to that I had a bill put on the order of precedence, as published yesterday in the Order Paper at No. 28. It was submitted to the private members' office at 5.55 p.m. Wednesday evening. I advised the clerk that if a substitution was to be made that I was looking for one. The next morning at 9 a.m. the clerk was advised.

Standing Order 94(1) states that ``the Speaker shall make all arrangements necessary to ensure the orderly conduct of Private Members' Business, including ensuring that all members have not less than 24 hours' notice of items to be considered during private members' hour''.

(1005 )

As of yesterday morning at 9 a.m., notice had been given. In fact on the evening prior, at approximately 5.55 p.m., notice had been given of a bill on the Order Paper that was published yesterday. At no time did I receive from that office an opportunity to be substituted or to be placed on the Order Paper for today. I appreciate that the rules also say that a member will give 48 hours' written notice.

I want to suggest to you, Mr. Speaker, that is one test. However, there are other tests. Certainly the office had more than 24 hours to contact other people and to ensure that the orderly conduct of private member's hour would continue.

Although 48 hours is one point, 24 hours is another point. Somewhere in that 24 hour interval there was opportunity. The office did know I was looking for a substitution. Had I been offered that place, it would have meant the rules requiring that 24 hours' notice be given and would have been published yesterday at 6 p.m.

I would suggest that as a result of this that my rights and my privileges have been usurped. In fact it is within your authority, Mr. Speaker, to do one of two things. Either to cancel the continuation of government business at 1.30 p.m. today, or to add a private member's hour following that one hour that has been apparently removed at this point.

I should point out that the bill to which I am referring has passed through the House, has passed through the Senate and only needs to come back on the Order Paper here. Notwithstanding the fact that the 48 hour notice has not been complied with in the sense of Standing Order 94(2)(a), that the orderly conduct of business could have continued. The 24 hour notice provision would have been complied with.

The 48 hour notice is not a precedent in the sense that a member must give written notice. I am advised that often members will call from distant places and say: ``By the way I am not going to be there''. Someone may call on a Monday from some remote place in the world and say he or she is not going to be here and not be able to provide written notice to the clerk, who on many occasions has acted. They have I understand also acted in terms of this window of opportunity being the point between 24 and 48 hours.

It is on that basis that I suggest to you, Mr. Speaker, that my privileges have been usurped and I ask for this extension or substitution of government business from 1.30 p.m. to 2.30 p.m.

Mr. Ted White (North Vancouver, Ref.): Mr. Speaker, I think the hon. member for Sarnia-Lambton has raised a very important point in his question of privilege. Private Members' Business is a when we bring material to this House which we take very seriously.

9920

The fact that I cancelled my appearance today on a private member's bill was actually done as a form of protest because my bill is non-votable.

The member for Sarnia-Lambton has a votable piece of material, and notwithstanding the Standing Orders and a ruling that you might make in connection with that, I would also like to suggest that perhaps in the process that is going on here we may be able to get unanimous consent of the House to do a substitution and to meet the needs of the hon. member.

The Speaker: I take it as part of my duties as your Speaker to ensure that there is a reasonable continuation of business in the House.

(1010 )

The hon. member for Sarnia-Lambton has quoted the passages in the rules which are germane to this point of privilege. The hon. member puts forward in his argument that he was not contacted24 hours prior to the period or surely he would have agreed to have his bill brought forward. I believe this is in Standing Order 94(1). If I am off on the number the clerks will correct me.

In Standing Order 94(2) of the rules of the House, which were established by us together in concert, it is quite clear that the Speaker should have notice some 48 hours prior to making any move. The reason the Speaker is given the 48 hours is so that he will be able to contact the member at least in the next 24 hours to have this member bring forward his bill.

The hon. member argues that sometimes written notice is not given. In my short experience here and because of the faxes that we now have, when a member calls to say he or she cannot bring forward a bill, we usually ask that a fax be sent and usually that is done.

Be that as it may, the rules are quite explicit. They state that notification should be given to the table officers, who will then inform the Speaker, so that there can be an orderly procedure in Private Members' Business.

I would rule that the Speaker did not get the 48 hours' notice and therefore I did not order the clerks to give the hon. member 24 hours' notice.

The hon. member for North Vancouver is here. He also confirms that he did not give the Chair 48 hours' notice.

What I find interesting in this whole matter is that you and the hon. member for North Vancouver are both here and you both seem to agree that this would be acceptable to the two of you. The suggestion put by the hon. member for North Vancouver might be the way to get around it. I will not take it upon myself to rule that your particular bill be ordered, but if you would care to put forward a request for unanimous consent that your bill be debated today, I would be interested in receiving such a request.

Mr. Gallaway: Mr. Speaker, I ask the House for unanimous consent to have a private members' hour today from 1.30 p.m. to 2.30 p.m.

The Speaker: Does the hon. member have the permission of the House to put forth the motion?

Some hon. members: Agreed.

Some hon. members: No.

The Speaker: There is no agreement. Therefore, we will not proceed with this point.

_____________________________________________

9920

GOVERNMENT ORDERS

[English]

INCOME TAX BUDGET AMENDMENTS ACT, 1996

The House proceeded to the consideration of Bill C-92, an act to amend the Income Tax Act, the Income Tax Application Rules and another act related to the Income Tax Act, as reported (with amendments) from the committee.

Mr. Zed: Madam Speaker, I understand there is unanimous agreement that the third reading stage of Bill C-92 may be considered as soon as the second reading stage is completed.

The Acting Speaker (Mrs. Ringuette-Maltais): Is there unanimous consent?

Some hon. members: Agreed.

(1015)

Hon. Paul Martin (Minister of Finance, Lib.) moved that the bill, as amended, be concurred in and read the second time.

The Acting Speaker (Mrs. Ringuette-Maltais): Is it the pleasure of the House to adopt the motion?

Some hon. members: Agreed.

Some hon. members: On division.

(Motion agreed to and bill read the second time.)

The Acting Speaker (Mrs. Ringuette-Maltais): When shall the bill be read the third time? By leave, now?

Some hon. members: Agreed.

Mr. Martin (LaSalle-Emard) moved that the bill be read the third time and passed.

Mr. Barry Campbell (Parliamentary Secretary to Minister of Finance, Lib.): Madam Speaker, I welcome the opportunity to debate Bill C-92, the Income Tax Budget Amendments Act, 1996.

When I last addressed the House on Bill C-92 it was to recommend that it be sent to committee prior to second reading. It is important to note, therefore, that the House finance committee

9921

recommended 13 amendments when it reported on the bill. All of them were technical in nature and were the result either of consultations or improvements in the wording of the relevant provisions. For example, there were some wording changes relating to labour sponsored venture capital corporations and resource properties.

There were also two amendments in the area of child support to help ensure that payments made after April 1997 were subject to the new system in accordance with the policy.

[Translation]

I would now like to make some observations about the context in which the proposed tax measures are situated.

In the present era of global changes, which have left many Canadians feeling insecure, the 1996 budget introduced measures in a number of areas that were designed to safeguard the future of Canada.

First were measures to safeguard our financial future, with guarantees that we would reach and even exceed our goals for public finances; in the same breath, we defined a role for government that meets the needs of the modern economy and of the federation.

We also took action to ensure the preservation of our social programs, including the old age security system and the offer of stable federal funding for programs administered by the provinces.

[English]

We invested in the future by reallocating money to priority areas for future jobs and growth, priorities like youth, technology and international trade. In the area of taxation perhaps the most noteworthy point is what we did not do. Despite the enormity of the fiscal challenge that faced us, a challenge we have continually handled with credibility and success, we did not increase tax rates in the budget, not personal, not corporate, not excise.

The government recognizes that taxes in Canada are higher than any of us would like. Fiscal turnaround is vital so that we can free up resources to ease the tax burden when it is responsible to do so. In the interim the government has made it a key priority to meet or better its fiscal targets without increasing personal income tax rates in any of the four budgets it has brought before the House.

Taxation is not only about generating revenues. It is also a matter of economic efficiency and fairness. That is why the 1996 budget undertook a number of important tax initiatives to enhance the fairness of the system and to ensure that it operates as effectively as possible.

Let me briefly outline a number of measures we are proposing in the bill before us today. In the area of personal income taxation several important changes concern the system for providing tax assistance to retirement savings. Specifically the budget proposed three measures affecting registered pension plans, RPPs, and registered retirement savings plans, RRSPs.

As the finance minister said at the time of the budget, Canada's retirement assistance program is effective and the government is firmly committed to its preservation.

(1020 )

The proposed changes will help to ensure the sustainability of the program by limiting its costs while at the same time better targeting assistance to modest and middle income Canadians.

First, RRSP limits are to be frozen at $13,500 through the year 2003 and then increased to $14,500 in 2004 and $15,500 in 2005. To provide comparable treatment to define benefit pension plans, the maximum pension limit for these plans will be frozen at the current level of $1,722 per year of service until the year 2005.

This change will keep the cost of the tax deferral for retirement savings in line and more fairly targeted. The federal revenue cost of this assistance is significant, amounting to nearly $16 billion in 1993.

Even with the changes the system will remain a generous one extending to twice the average wage. This means that only individuals with incomes over $75,000 a year will be affected in any way.

The second measure relating to retirement savings is the reduction in the age limit for maturing RPPs and RRSPs from age 71 to 69. In other words, individuals will not be able to contribute to RRSPs or accrue pension benefits after age 69 and will have to start drawing income out of these plans by the end of the year in which they turn 69. This change will help move the maturation age for retirement savings and pension plans closer in line to the ages at which most Canadians are retiring.

I pause here to say that contrary to the assertion that some have made about this change, it does not remove incentives to save in RRSPs, private pension plans or other retirement income vehicles. Canadians will always be better off saving for their retirement and using these vehicles as one way to do so.

Third, the bill proposes the elimination of the seven-year limit on carrying forward any unused portion of maximum allowable RRSP contribution. I am sure most of us can relate to the fact many younger Canadians have difficulty making significant RRSP contributions, especially during the years when they are raising families. This proposed change will improve the opportunity for all Canadians to benefit from the RRSP system. People will now have an unlimited time, within age limits of course, to make up for years of lower contributions. That is an important change.

The bill addresses another vital area for saving for the future, registered education savings plans or RESPs. Canadians know that a better education means a better job and the Government of Canada knows that to prepare Canadians for the 21st century we must support their efforts to secure a good education. Hence in both the 1996 and 1997 budgets the federal government increased tax assistance to students and their families. RESPs are an important mechanism that assists parents or grandparents to save for children's education. They do so by exempting the growth of assets

9922

within the RESP from taxation. Eventually this growth is distributed to students who are typically taxed at a low marginal rate.

The bill before us proposes to increase the annual contribution limit from $1,500 to $2,000 per beneficiary. It will increase the lifetime limit from $31,500 to $42,000.

As most hon. members will recall, the 1997 budget proposed to enhance tax assistance delivered through RESPs further still, notably by doubling the annual contribution limit to $4,000 per beneficiary and by improving the potential flexibility of these plans.

Two further elements of today's legislation recognize the increasing importance in the cost of education. First, the bill proposes to increase the amount on which the education tax credit is calculated from $80 to $100, an amount that the 1997 budget has proposed to increase still further.

Second, the bill will increase from $4,000 to $5,000 per year the limit on the unused tuition fees and education amounts that students may transfer to spouses or parents. Once again this measure would be enhanced by the proposals of the 1997 budget which would allow students to carry forward those unused amounts.

Many of the individuals who need training or retraining to make the most of the opportunities in today's economy already have young families to care for. For many of them, especially single parents, school is not an option without day care for their children. That is why today's bill proposes to broaden eligibility for the child care expense deduction by allowing parents who are full time students to claim the deduction against all types of income.

I should mention that the bill would also raise the age limit for children for whom child care expenses may be claimed from age 14 years up to age 16 years, thereby providing increased tax savings for families with older children.

(1025 )

A further measure in the bill that will benefit taxpayers with children is the change to the rules governing child support. Specifically the bill provides that child support paid under a court order or written agreement after April 1997 not be deductible by the payor or included in the recipient's income. This change reflects the widely held view that the old system of deduction and inclusion was not working to benefit children.

I remind my hon. colleagues this tax measure is one element in the larger child support package which recently received parliamentary approval. In addition to the tax changes in the bill, the package includes guidelines to set fair and consistent support awards, new measures to enforce child support orders and, as announced in the 1997 budget, an enrichment of the child tax benefit. Education and child care are important components of the economic and social infrastructure for tomorrow.

I will now turn to to another keystone of Canadian society, the charitable sector. That sector is playing an increasingly important role in meeting the needs of Canadians. The government recognizes the importance of giving charities the tools they need to accomplish their important work. For that reason the 1996 budget increased from 20 per cent to 50 per cent the annual limit on the amount of taxpayer net income eligible for tax assisted charitable savings. Once again I remind hon. members that the 1997 budget has gone further, substantially increasing tax incentives for charitable giving.

I will skim over some of the other major measures included in the bill beginning with labour sponsored venture capital corporations. These funds sponsored by labour organizations help improve access to capital for small and medium size businesses and thereby contribute to job creation. Generous federal and provincial tax credits have helped LSVCCs attract large amounts of venture capital, so large in fact that by the time of the 1996 budget they had a more than three-year supply of capital. Given this level of capital accumulation, measures were warranted to keep the level of special tax assistance in these funds in line with current fiscal realities.

Consequently today's bill proposes reducing the federal LSVCC tax credit from 20 per cent to 15 per cent, reducing the maximum purchase eligible for the credit from $5,000 to $3,500 and not permitting a taxpayer to claim the federal LSVCC credit for three years after he or she has redeemed an LSVCC share.

The bill also includes important measures for the energy and resource sectors, for the oil, gas and mining industries. The bill modifies rules relating to the resource allowance thereby resulting in a more stable and consistent tax structure. For the oil, gas and mining industries the bill proposes significant improvements to the flow through share regime.

Flow through shares are an important mechanism for financing exploration and development programs in these resource industries, as they can be used to accelerate deductions for such expenses. Companies issuing flow through share which incur exploration and development expenses within the first 60 days of a calendar year can renounce those expenses which are then treated as having been incurred by the flow through share investor in the previous calendar year.

Consultations with the industry have indicated that the 60-day limit was too restrictive and encouraged corporations to make economically inefficient decisions. Accordingly the bill would allow the issuing company a full calendar year to incur and renounce the exploration expenses. In return for this accelerated

9923

deduction, however, the issue will be required to pay a monthly financing charge to the government.

Among the other provisions of the bill is a change to the accelerated cost allowance rules for new mines including oil sands which will ensure that all types of oil sands recovery projects are treated more consistently. The bill also includes measures to designed to promote sustainable development of energy resources by providing an essentially level playing field between certain renewable and non-renewable energy investments.

One measure is to create a Canadian renewable energy and conservation expenses category in the tax system. The second measure is to extend the use of flow through share financing currently available for non-renewable energy and mining and similar costs for certain renewable energy and energy conservation projects.

[Translation]

With this, I will conclude my overview of the measures addressed in the bill under consideration today. These measures are equitable and will make it possible to improve the effectiveness of the tax system. Several of these measures, by their very nature, eliminate constraints, and many Canadians have already benefited from the provisions of this bill.

These measures will help Canadians prepare for the future in a world that is constantly evolving, by stimulating job creation, education and charitable donations, among other important sectors of activity.

(1030)

The measures in the bill under study reflect the values and expectations of the Canadian people. As their elected representatives, it is our responsibility to respect these values and expectations.

Accordingly, I have no hesitation in urging my colleagues to support this bill in its entirety and to give it speedy passage.

Mr. Roger Pomerleau (Anjou-Rivière-des-Prairies, BQ): Madam Speaker, essentially, Bill C-92, which is aimed at amending the Income Tax Act and the Income Tax Application Rules, is intended to bring the Income Tax Act into line with the decisions in the 1996 budget.

In both the 1996 and the 1997 budgets, there is, essentially, nothing new. In fact, just recently, we learned that the anticipated $19 billion deficit will actually be far lower than that, after 11 months of operation. The deficit is, in fact, less than $8 billion, which means that the Minister of Finance will have an enormous amount of money to work with in the coming months.

Where does this come from, one might wonder. The announced objective of the cuts in government spending, in operating expenditures, not having been met, where does this enormous sum we are speaking of today come from?

We know that there are, essentially, two sources: the $4.5 billion in cuts in transfers to the provinces, or in other words $4,500 million, and the $5,000 million they garnisheed from collective wages via the unemployment insurance account. We know that these two, the cuts to provincial transfer payments and the lifting of wages from the unemployment insurance fund, essentially account for 84 per cent of the deficit reduction. So it is the unemployed, the sick, the welfare recipients and the students who will bear the brunt of this deficit reduction.

With reference to the cuts in transfers to the provinces, we will remember the commitments made by the Prime Minister on Canada AM on October 20, 1993. I am translating what he said in English, which we can presume means the same in French. Here is what he said on October 20, 1993: ``We said in our platform we do not intend to reduce the transfer payments. What I said in the program, and I intend to keep my word, is we do not intend to cut further''. That was said less than a week before the last election.

A few months after the election, on April 19, 1994, the Minister of Finance told the Toronto Star that the next federal budget would include drastic cuts to assistance to the provinces for such things as health, welfare and education. This is exactly the opposite of what the Prime Minister had said.

There will be an election shortly. I hope people will remember that, when this government makes promises, even just a week before an election, it has no intention whatsoever of keeping them. The cuts to the transfer payments to the provinces mean, for Ontario as well as for Quebec, that drastic cuts are now being made in health care, payments to welfare recipients, and education.

It must be clearly understood that these cuts are inevitable, and are the result of cuts to transfer payments from the federal to the provincial governments. I know that some of my fellow Quebecers are still saying: ``Yes, but the federal government gives us money''. There have been no cuts in federal funding, for what the federal government is doing with its transfer payments, in actual fact, is returning to us part of what we send to the government in Ottawa, $30 billion annually.

As well, the government dips into the unemployment insurance fund to the tune of $5 billion, when it contributed not one red cent of that.

(1035)

As you know, the money in the unemployment insurance fund is basically the money put into the fund by workers and their employers. There is not one cent of the government's money in the fund. However, $5 billion was taken out of the unemployment insurance fund to balance the books, and that is why the Minister of Finance now has this extraordinary flexibility. That flexibility exists at the expense of the little guy, the sick, people on welfare and the unemployed, the unemployed whom the Prime Minister not

9924

so long ago described as useless beer drinkers sprawling in front of the TV. And the result has been to create massive poverty in Canada and Quebec.

They know perfectly well that thousands of people will no longer be eligible for unemployment insurance and will have to go on welfare. But before they go on welfare, they have to exhaust all their resources, everything they have, until they have nothing left. This is now happening to thousands of people in Canada and Quebec. This wage grab and cuts in transfers to the provinces have caused poverty levels to rise dramatically.

Meanwhile, the government is doing nothing to reduce tax expenditures. Nothing was done in 1996 and nothing has been done in 1997. Perhaps I may explain, as I did recently, what a tax expenditure is.

Obviously, if tomorrow the government decided to send a cheque for $100 million each to 10 different companies, people would hit the roof. There would be headlines in the newspapers, and the public would know the government is doing something that makes no sense at all.

A tax expenditure occurs when instead of sending a cheque for $100 million, $50,000 or whatever to a company, the government tells the company it owes so much in taxes but does not have to pay them. It amounts to the same thing for the company, which will save $50,000. And it amounts to the same thing for the government, which instead of receiving a cheque for $50,000, will have a shortfall of $50,000. However, there will not be the same public outcry.

Sure, if the government wrote cheques to companies every day, it would be in the headlines. But if it is a tax deduction on a company's more or less confidential tax return, the public does not see that. In other words, tax expenditures represent money that is not collected, although it should be, from companies or the public.

The Auditor General of Canada gave a good example of a tax expenditure not long ago when he revealed that a family trust went to the United States with the blessing of Revenue Canada under very dubious circumstances. The Auditor General said at the time, very diplomatically, that the company and those who made the decision to let the trust go, had, as it were, frustrated the intent of the legislator. In other words, they were breaking the law. That was the opinion of the Auditor General of Canada.

So a family trust left the country with $2 billion on which no income tax was paid. It is estimated that between $400 million and $500 million in taxes should have been paid. Of course, if the government had written a cheque for $400 million or $500 million in this country and sent it to this family trust or to the two trusts which, in fact, belong to the same person, the public would have been outraged. The Auditor General explained how this happened, the details were published, it was in the headlines for one day, but no one talked about it again. Why? Because tax expenditures are so complex.

You may recall certain tax commitments in the red book. On page 19, we read:

A number of government programs and tax expenditures-some of which have been identified by the Auditor General-are inefficient, poorly managed, or driven for purely political reasons. Just as we are proposing new measures to grow the economy, we will examine such programs with the objective of reducing waste and inefficiency and promoting economic growth.

That was the commitment.

(1040)

And then there was the report of the auditor general on family trusts and the Liberals' reaction in the finance committee. Each of them took a turn sniping at the auditor general for having criticized the fact that the trusts had hot footed it out of the country without paying taxes.

That is precisely the role of the auditor general. He is the public watchdog. When we criticize the government, we are partisan, clearly. When the auditor general does so, we can assume generally that he is non partisan. The Liberals took pot shots at the auditor general for criticizing the family trusts I referred to earlier.

So, as we realize, there is no deficit problem in Canada. We are reducing the deficit far faster than we had anticipated in our objectives. The Minister of Finance has a lot of manoeuvring room. We therefore have no deficit problems in the short term. We even expect to bring the deficit to zero by the year 2000. However, there is a question of fairness, since it is the middle class that is paying off the deficit. It is becoming increasingly poor. The government is creating huge poverty in Canada, leaving untouched those who are in a position to benefit from the tax laws. It is the middle class that is getting it.

That is why the Bloc Quebecois decided in November 1996 and February 1997 to table two studies on taxation: corporate taxes, first, and personal taxes, second. This sort of study has never before been prepared by the official opposition.

The Minister of Finance reacted to our first study by saying: ``The Bloc Quebecois tabled a sober report yesterday. I consider it a very professional one. I thank the Leader of the Opposition and the members here for their work. There are many things in the report we agree with'', and I quote him exactly. Yet, it was shelved and will probably gather dust there for a number of years. It is some one hundred pages long and was prepared with the means available to us, because the official opposition has far fewer means

9925

available to it than the government. This is the first time such a thing has been done, up to now.

The last time the tax system was totally revamped was in 1962, as a result of the Carter Commission. According to the Carter report, tax criteria had to be followed. The system had to be fair and different incomes taxed the same way, regardless of source or recipient. That, basically, was the philosophy of the Carter report.

Many of the report's recommendations were never implemented in the Income Tax Act, which was to be expected, but we used the report as a reference work in terms of both principles and approach. It covered the whole Income Tax Act and was 2,575 pages long. It was six years in the preparation, and its recommendations were never fully implemented.

In 1966, the Liberal government, which had been given the report, decided not to use it. It asked the Minister of Finance to produce a white paper on taxation-this government's usual solution is to produce white papers or red books as appropriate- and a watered down version of the Carter report led to the 1971 amendments to the Income Tax Act.

We had to wait until 1981 for the next changes. However, the Minister of Finance at the time, Allan MacEachen, underestimated the resistance of the financial community and had to back off on a number of amendments he had wanted to make to the Income Tax Act. The final tax reform was Michael Wilson's in 1987. He too had to retreat on some of the reforms, because of major pressure from lobby groups to limit the extent of reforms.

The principles underlying the Bloc's two reports on taxation are those found in the report of the Carter commission, principles everyone can understand, principles of fairness, efficiency, neutrality and stability.

(1045)

Under the principle of fairness, the tax system must ensure a fair distribution of the tax burden among taxpayers. We appreciate that everyone should pay taxes. The taxation system must not only be fair but also be perceived as such, that is to say, people should feel that everyone is paying their fair share.

We can assess how equitable a tax is by one of two yardsticks: it must either reflect the ability to pay of those who are subject to it-that is what we call vertical equity-or match the benefits to the taxpayers, a principle called horizontal equity. The implementation of a progressive tax system is consistent with the principle of vertical equity.

In a vertical equity analysis, one has to use the concept of diminishing returns John Stuart Mill described in his book, clearly defining it in terms of a single taxpayer's equivalent sacrifice. This is taken, of course, from Principles of Political Economy with Some of Their Applications to Social Philosophy. I think it is not widely known, but the majority of leading economists in the early days were in fact philosophers preoccupied with ethical concerns or wondering why, and the question is still valid today, there was such a huge gap between the rich and the poor.

This means that each taxpayer does not pay the same amount of taxes proportionally to make an equal marginal sacrifice. It would clearly not be as much of a sacrifice to pay $2,000 in taxes for someone earning $500,000 per year as for someone earning $12,000. That is why, in the interest of equity, there is a so-called tax progression.

But the facts tell quite a different story. Just think of family trusts that were transferred to the U.S. tax free. Clearly, the public realizes there is nothing fair about that.

Think of the Liberal member for Gander-Grand Falls, who, every 12 or 18 months-he must spend most of his time at Revenue Canada-issues the list, withholding names of course, of dozens of millionaires who not only never pay tax but actually receive money from the Government of Canada in the form of additional tax deductions. They actually receive money from the Government of Canada. In fact, I think the hon. member for Gander-Grand Falls does a fine job. What I find extremely distressing in all this is that, the next day, it is all but forgotten.

Think also of the strong public belief that the current system is not fair, that the poor keep paying while the rich manage to get out of it.

The second principle on which these reports on the tax system were based is the principle of efficiency. To be efficient, any taxation system must be kept as simple as possible. It makes it easier to enforce, and the taxpayers waste less time making sure they have complied with the various tax regulations.

In addition, a simpler taxation system results in lower government management costs. When income tax time is upon us, we realize that, for most of us, it is no simple task to fill out a personal income tax return. As for corporations, we know they do not just file a regular income tax return. They have tax experts who dig into piles, three or four feet high, of tax documents. They go to great lengths to avoid paying tax.

All this to say that this is a very complex system. When we meet tax experts, whether at the Standing Committee on Finance or elsewhere, that is the first thing they tell us: the tax legislation is extremely complex and we lay people need their help to understand it. It is a fact that one needs very complex training to sort it all out. In a nutshell, the current taxation system lacks efficiency.

9926

The third principle is that of neutrality. The taxation system must be neutral. This means that companies should make investments based on economic and financial considerations and not on tax considerations.

(1050)

Yet, we are well aware that many companies make major decisions which are not based on economic or financial interests, but on the impact that these decisions will have on the amount of taxes they will have to pay. So, the system is not neutral.

The fourth principle is the principle of stability. A tax system must produce stable revenues over the years for the government, so that it can make consistent economic forecasts. Stability provides for a certain continuity in the level of revenues and expenditures.

Such stability currently does not exist, given that the government was forced to cut $4.5 billion in transfers to the provinces-which is not a source of revenue-and to garnish workers' wages by taking $5 billion out of the unemployment insurance fund, so it could reduce its deficit. This shows that the tax system is not stable.

All these principles, developed by the Carter commission and reiterated by Bloc Quebecois members with the very limited means available to them, show that a tax reform is in order. This is one of the reasons why such a reform is necessary, but there are many more.

As regards corporate taxation, our first document was essentially tabled because we realized that, over the years, corporations have been paying less and less taxes. I will show you figures which I already mentioned in the House, but which bear repeating every day. Let us take a look at the gap between taxes paid by corporations and individuals since 1951. I will show that gap for every 10-year period, that is for 1952, 1962, 1972, 1982 and 1992. Here are the figures.

In 1952, corporations contributed 51 per cent of the taxes paid to the government, compared to 45 per cent for individuals. In 1962, 10 years later, corporate taxes amounted to 36 per cent of the total; in 1972, it was 20 per cent; in 1982, it was down to 18 per cent, and, in 1992, it was a mere 7.6 per cent. We can see that, over the past 40 years, corporate taxes have steadily gone down, while personal taxes have increased.

So, over the past 40 years-and this is the second reason why we are asking for a comprehensive tax reform-the tax burden in Canada, has been supported less and less by corporations and more and more by the middle class and the poor, through cuts affecting services provided to them. This is the second good reason for a tax reform.

The taxation principles stated by the Carter commission are no longer being complied with. Moreover, for the past 40 years, corporations have been paying less and less taxes, while individuals have been paying more and more. Under the circumstances, it would be in order to go back to the conclusions of the Carter commission.

The third principle is a bit of a myth. It has always been said that corporate taxes should not be substantially increased, because corporations in Canada may already be paying too much tax, compared to companies in other countries. According to statements made by succeeding governments, both Liberal and Conservative, corporations pay too much tax in Canada. However, the figures show just the opposite.

I am referring to the figures from the OECD, which compared the corporate tax rates in various countries. We are talking here about corporate tax revenues, that is the taxes paid by corporations in relation to the country's gross domestic product. Let us look at the years 1965, 1975, 1985 and 1993, since the data for 1995 is not available. Let us see how Canada fares.

According to these figures, in the United States, for the year 1965, 6.48 per cent of tax revenues came from corporations, compared to 4.7 per cent for Canada, 12 per cent for France,7.23 per cent for Germany, and 5.81 per cent for Japan. In 1965, Canada, along with Spain and the United Kingdom, was the country with the smallest proportion of tax revenues being paid by corporations.

(1055)

In 1975, ten years later, the percentage for Canada was 6.38, and for the United States, 7.16. On might expect lower taxes in the United States, but the opposite is true. Corporate taxes are higher in the United States. The same is true in France, Germany and Japan, all of which have corporate taxes several points higher than Canada's.

In 1985, it is even worse, and in the final year, 1993, Canada looked to corporations for less than 6 per cent of its revenue, the United States, 7.25 per cent, and Japan, almost 10 per cent. Japan is not a third world country. It looked to corporations for almost 10 per cent. Internationally, therefore, Canada is not facing impossible competition. It is even one of the countries-and we are talking about industrialized countries-with the lowest corporate taxes.

The same analysis can be done for tax revenue, but this time compared to overall revenue. Here again, Canada ranks lowest among all other industrialized countries, including the United States. We therefore see that Canada is one of the OECD countries with the lowest corporate taxes compared to individual taxes.

Do I have one minute remaining, Mr. Speaker?

The Speaker: Dear colleague, there are 14 minutes remaining, but we are coming up to the time for statements by members, and that is why I was motioning to you. That is all.

9927

Mr. Pomerleau: Mr. Speaker, how kind of you. In fact, I still have quite a bit to say. But since there is a logical break in my text at this point, I will therefore stop for now and continue after oral question period for the time I have remaining.

The Speaker: I am in agreement, dear colleague. It being now almost 11 o'clock, the House will now proceed to statements by members.

_____________________________________________

9927

STATEMENTS BY MEMBERS

[English]

SMALL BUSINESS

Mrs. Marlene Cowling (Dauphin-Swan River, Lib.): Mr. Speaker, small business is one of the fastest growing sectors of the Canadian economy and women are leading the way.

This was recently demonstrated at a Small Business Info Fair which I hosted in my constituency of Dauphin-Swan River. I was pleased to see that so many of the participants were women entrepreneurs.

Did members know that women make up over one-third of independent business people in Canada, that Canadian women operate more than 700,000 firms employing 1.7 million Canadians and that half of women entrepreneurs started their businesses with less than $10,000?

I am proud of the opportunities that the Liberal government has given to small business owners. Congratulations to the women of Dauphin-Swan River who have used their pioneer spirit and followed their dreams to operate a small business.

* * *

MANITOBA FLOOD

Mr. Jake E. Hoeppner (Lisgar-Marquette, Ref.): Mr. Speaker, Manitobans are again facing devastation from flooding. In fact, it is predicted this will be the worst flood situation since the mid-19th century. Thousands of people will be forced from their homes, and while local governments are better prepared than ever before, we could be entering into unknown territory according to a natural resources spokesman.

Manitobans would like assurance that the federal government will work quickly and co-operatively with the provincial and municipal governments to provide emergency relief for families and financial compensation to repair flood damage.

I hope Manitoba flood victims will not have to experience a repeat of last year when the federal government attempted to renege on its commitment after the fact.

INFRASTRUCTURE PROGRAM

Mr. Paul DeVillers (Simcoe North, Lib.): Mr. Speaker, Ernie Eves, Ontario's minister of finance, has claimed today in the Globe and Mail that the federal Liberals are delaying the Canada-Ontario infrastructure program ``with an eye to the coming election campaign''.

The facts show who is really delaying the infrastructure program. The federal government has already signed agreements with eight provinces and one territory. The federal government is ready, willing and able.

(1100)

The extended infrastructure program could create more than 6,500 new jobs in Ontario. Ontario is the only province that has not concluded an agreement. I would like Mr. Eves to tell the constituents of Simcoe North why Ontario is stalling on creating new jobs.

In many other files, the federal government has shown its unequivocal desire to move ahead. Who is stalling on harmonizing the GST in Ontario? Who rebuffed the Prime Minister's efforts to amend the Constitution? Who is delaying an agreement on labour force training for Ontarians? The provincial Tory government of Mike Harris, that's who.

Let's go to the polls today and ask Ontarians who is working for Canadians and who is playing politics.

* * *

VISTAJET

Mrs. Sue Barnes (London West, Lib.): Mr. Speaker, the Liberal government's policies for a growing economy are working.

Today Vistajet, headquartered in my riding of London West, announced an expansion of its operations to better service passengers flying between Toronto, Windsor and Ottawa. Vistajet has already hired 55 new people and hopes are soaring that the London based jet airline will create employment for at least 200 more within a year with the addition of new routes.

The company aims to become a national carrier offering value conscious leisure and business travellers the convenience of flying at a rate comparable to driving or taking the train.

It has been the Liberal government's management of the Canadian economy that has enabled companies like Vistajet to expand. During four consecutive budgets, the Minister of Finance has adopted policies that have reduced interest rates to historic lows and fostered a competitive economy, laying the foundation for the private sector to create new jobs for Canadians.

To Vistajet and its new employees-

9928

The Speaker: The hon. member for Bruce-Grey.

* * *

INFRASTRUCTURE PROGRAM

Mr. Ovid L. Jackson (Bruce-Grey, Lib.):.): Mr. Speaker, last December the government offered the provinces and territories the possibility of extending the Canada infrastructure works program for another year. Since that offer, nine provinces, except Ontario, have agreed to continue this successful program to build infrastructure and create jobs in their communities.

The Canada infrastructure works program allows municipalities to set priorities for projects. It is a grassroots approach to government which involves local elected officials who know what is best for their communities.

Our government and the provinces respect the municipalities as equal participants in the program.

As a former mayor, I encourage the Government of Ontario to involve local governments in the decision making process. The issue is jobs and the enhancement of community life. I hope that the Government of Ontario will not let this opportunity go.

* * *

[Translation]

FISHERIES

Mr. Antoine Dubé (Lévis, BQ): Mr. Speaker, the fishery has never been in such poor shape as since the Liberals came to power in Ottawa.

Successive fisheries ministers have managed only to lower fishing quotas, shorten seasons, reduce the size of fleets, slow down processing plants, and manage the resource to the advantage of fishermen from Newfoundland, the province from which, furthermore, all the Liberal Party's fisheries ministers have come.

I am not asking this government to bring back the missing fish, but to reverse the power play by which the Liberal government took over management of the fishery from Quebec in July 1983. Quebec had handled this responsibility perfectly well since 1922. Quebec's fishermen will never be well served by Ottawa, which takes no account whatsoever of their opinions and their needs.

I am certain that, until such time as it attains sovereignty, Quebec has all the expertise necessary to handle this responsibility successfully.

[English]

GOVERNMENT EXPENDITURES

Mr. Jack Frazer (Saanich-Gulf Islands, Ref.): Mr. Speaker, the truth is out. Rather than fulfilling its red book promise to provide honest, more accountable government, Liberal patronage is alive and well, in fact, working overtime.

While armouries across the country are being considered for closure, the Prime Minister's canoe museum in Shawinigan will now be matched by a government funded hotel and a large new armoury.

Nor will the Deputy Prime Minister miss out on Liberal election largesse. Hamilton will receive a new naval reserve building. Not to be outdone when it comes to pork-barrelling, the health minister's Nova Scotia riding receives a new naval reserve complex.

Our reserves play a vital role in the military and social fabric of Canada and deserve our support, but is it not strange that all six new armouries or naval reserve facilities are going to Liberal ridings?

The shutdown of the Somalia inquiry to prevent scrutiny of high level defence involvement, the buying of political favour with taxpayer money and a host of broken red book promises prove that the Liberals have not and will not provide honest, good government.

* * *

(1105)

[Translation]

QUEBEC MAPLE SYRUP INDUSTRY

Mrs. Monique Guay (Laurentides, BQ): Mr. Speaker, Quebec's maple syrup industry has modernized its image and set its sights on outside markets.

Quebec alone accounts for 90 per cent of Canadian production, of which 80 per cent, it is estimated, is consumed outside the country. Last year, the industry exported over 20,200 tonnes of maple syrup, 4 per cent more than in 1995, to 32 countries.

During the same period, the value of these exports jumped to $97 million, a 20 per cent increase, and in just four years the value of exports has almost doubled, rising to 84 per cent, an average annual increase of 22 per cent.

These results are attributable to the revitalized methods being adopted by longstanding producers, and the emergence of a series of new and very dynamic enterprises, with different approaches and products, that are targeting a much broader range of niche markets than ever before.

* * *

[English]

PROGRESSIVE CONSERVATIVE PARTY

Mr. Francis G. LeBlanc (Cape Breton Highlands-Canso, Lib.): Mr. Speaker, yesterday the leader of the Tory party was in

9929

Nova Scotia trying to resurrect support for a party the voters rightly repudiated in 1993.

He has a tough job ahead of him. The voters in Nova Scotia remember well the legacy of that last Tory government, a government of which he was a part: higher unemployment, higher taxes, government finances out of control, missed deficit targets, scandal after scandal. He hopes Nova Scotians will forget. They will not.

The election has not been called and the Tory platform has already been discredited. Their numbers do not add up. Nova Scotians know that a party fighting for the right wing Reform vote in the rest of Canada is not a party that can be trusted in Atlantic Canada.

The people in Nova Scotia know that the Liberals have delivered good government. We have cleaned up the fiscal mess of the Mulroney years. We have acted to protect and sustain our social programs and we have put the economy on the right track.

We are beginning to see the results with low interest rates, growing consumer confidence, a good climate for growth and jobs.

* * *

LESTER B. PEARSON

Mr. Mac Harb (Ottawa Centre, Lib.): Mr. Speaker, this year marks the 100th anniversary of the birth of Lester B. Pearson, Canada's Prime Minister from 1963 to 1968.

Mr. Pearson had one of the most distinguished careers in Canadian political life. In 1957 he was awarded the Nobel Peace Prize in recognition of his leadership in establishing Canada as the world's peacekeeper.

Mike Pearson was a pragmatic, humble, decent consensus builder.

On Wednesday, April 23, it will give me great pleasure to join with my colleagues and my constituents in paying tribute to this great man at the Pearson Centennial Dinner at the National Arts Centre.

Lester Pearson was a leader who made Canada an even better place to live. To his family and friends, may his memory live with us forever.

* * *

[Translation]

DEPUTY PREMIER OF QUEBEC

Mr. Mark Assad (Gatineau-La Lièvre, Lib.): Mr. Speaker, I hesitated until the last minute about making this speech. Should I, or should I not, bring up the words used by Bernard Landry the day before yesterday concerning our Prime Minister?

Should such an attack be allowed to pass without comment, so as not to attract more attention to it than it merits, or should it be vehemently objected to? The liberal principles and values to which I fully subscribe teach us not to counter an insult with another insult.

The Bernard Landrys of this world ought to realize that such an attack on the Prime Minister is an attack on the very foundations of the political institution. And then they turn around and moan about the lack of confidence and the cynicism people have toward politicians.

* * *

SENATOR PIETRO RIZZUTO

Mr. Stéphan Tremblay (Lac-Saint-Jean, BQ): Mr. Speaker, reference has just been made to great Liberal principles.

The Corival construction company, of which Liberal Senator Pietro Rizzuto is a minority shareholder, has been fined $56,000 by the Quebec Court for major fraud. A Revenue Canada investigation has proven that the company of Rizzuto and his brother-in-law claimed four fictitious invoices totalling $198,000 as business expenses for tax purposes.

This is not the first time that Pietro Rizzuto, the Quebec campaign manager for the Liberal Party of Canada, has been involved in some funny business. During the 1993 election, he had promised jobs to all defeated Liberal candidates. Three and a half years later, 40 of those former Liberal candidates or MPs have jobs in the Chrétien government. It is therefore obvious what clout this man of few principles wields in a party that thumbs its nose at ethics and integrity.

The Liberals have just reminded us, once again, that where honest government is concerned, they are tarred with the same brush as the Conservatives. Their 1993 commitment to restore integrity was mere opportunism, and was not rooted in any real desire for change. Accordingly-

(1110)

The Speaker: I am sorry to interrupt. The hon. member for Miramichi has the floor.

* * *

NATIONAL VOLUNTEER WEEK

Mr. Charles Hubbard (Miramichi, Lib.): Mr. Speaker, this is National Volunteer Week.

[English]

As members of Parliament we must acknowledge the tremendous contributions that many Canadians make in improving the lot of their fellow citizens. Time is one of our most precious commodities. It is important that all of us use this time effectively and efficiently.

Across Canada many Canadians budget some of their time in an effort to enhance their communities by serving on boards, in providing recreation, in coaching, with youth programs, in visiting the sick and providing services that would cost our communities

9930

many thousands of dollars. Volunteerism, the offering of one's time to the community, offers all of us a tremendous contribution.

Today we salute these volunteers for their efforts and those people who offer their services to charities.

I would like to challenge all Canadians to reflect on this use of time and consider the importance of volunteerism.

* * *

BANFF NATIONAL PARK

Mr. Ted White (North Vancouver, Ref.): Mr. Speaker, yesterday the Minister of Canadian Heritage released her plan for the Bow Valley, but in her haste to pander to the demands of some vocal special interest groups, she could well be cutting off access to, and quiet enjoyment of, the park for the elderly and disabled.

If the Bow Valley Parkway is closed to all automobile traffic, those who can no longer, or never could, hike or walk long distances, will be deprived of the opportunity to enjoy some birdwatching, a picnic lunch or a short stroll in an alpine meadow.

What is the use of a national park if it is reserved only for use by speciality hikers and those who do not mind being crammed into a crowded bus for a quick trip through the woods?

If speed or too much traffic is the problem, surely we could restrict the speed limit or the number of vehicles going through the Bow Valley Parkway each day. That is the way it is being done in the Grand Canyon national park.

On behalf of the regular users of the park who alerted me to this problem, I urge the heritage minister to please reject any complete closure of the Bow Valley Parkway. While she is at it, could she please confirm whether there is any truth to the rumour that she is building-

The Speaker: The hon. member for Regina-Qu'Appelle.

* * *

NEWSPAPERS

Mr. Simon de Jong (Regina-Qu'Appelle, NDP): Mr. Speaker, with each passing day, ownership of Canada's daily papers and private television and radio stations are controlled by fewer and fewer people. Today, entire regions of the country get the news from daily papers owned by one large company. Conrad Black's Hollinger Incorporated now controls 60 per cent of Canada's daily newspapers and 43 per cent of Canada's coast to coast circulation. The consequences for democracy are severe.

When Conrad Black bought control of all Saskatchewan newspapers, 171 jobs were lost and specialized reporting on agriculture, health and civic politics fell 20 per cent of their previous levels.

The reaction of Liberals was to sit on their hands on the grounds that no commercial interests had been harmed. The silencing of dissenting voices, the limits on what we counted on as news did not trouble them.

But highly concentrated media ownership limits the free exchange of ideas and information among Canadians. What we need in this country are new rules to limit the concentration in the media and protect democracy. We need a Canada-

The Speaker: The hon. member for Sarnia-Lambton.

* * *

NATIONAL UNITY

Mr. Roger Gallaway (Sarnia-Lambton, Lib.): Mr. Speaker, for hundreds of years, even before Confederation, Canada has been a nation characterized by cultural diversity.

Our First Nations were joined by many newcomers who arrived from every nation on earth. Countless waves of pioneers and adventurers became united in an untiring effort to build a new land, proud to call itself home to the languages, arts, religions and traditions of the world.

These ancestors have left us a cultural heritage and diversity envied and respected throughout the global community.

When all Canadians grasp the gifts at hand that forge a bright future for our country, we will enter the third millennium as a cohesive, respectful nation, second to none.

* * *

MEMBER FOR SURREY NORTH

Ms. Margaret Bridgman (Surrey North, Ref.): Mr. Speaker, I have been honoured these past 3.5 years, an honour that is bestowed on very few Canadians.

I wish to thank the citizens of Surrey North for providing me with this opportunity to be their member of Parliament. I am honoured to represent them in the House of Commons. I also want to thank my Reform colleagues for their support and encouragement over the past 3.5 years. It has been a phenomenal growth for all of us and has been interesting to watch.

(1115 )

I thank the other members of Parliament and the Hill staff for their friendliness and co-operation in our deliberations in Ottawa. I extend a special thanks to my staff, my family and friends, especially to Le and Pearl Hale, for their continuing support.

9931

For me the past 3.5 years have been an unforgettable experience, one I will treasure.

* * *

OTTAWA YOUTH ORCHESTRA

Ms. Marlene Catterall (Ottawa West, Lib.): Mr. Speaker, earlier this week I had the great privilege to wish bon voyage to the Ottawa Youth Orchestra. Members of the orchestra will be travelling with the Newfoundland Youth Symphony Orchestra to Bristol, England to celebrate the 500th anniversary of John Cabot's historic voyage to the new world. Together with young musicians from Bristol they will be performing at the celebrations.

These young people are Canada's outstanding musicians of the future. They are our cultural ambassadors to the world and we wish them well on this important mission.

* * *

MEMBER FOR CALGARY CENTRE

Mr. Jim Silye (Calgary Centre, Ref.): Mr. Speaker, I would also like to express my sincere thanks and appreciation to those who have helped me in the constituency, those who have worked hard with me in both offices, Calgary and Ottawa, and government members, a lot of whom showed courtesy and kindness in helping us along.

I agreed with many of your rulings, Mr. Speaker. However, there were a couple that I disagreed with. It was always when you cut me off and would not give me an opportunity to speak a little longer.

Mr. Speaker, it was an honour and a privilege to serve and represent the people of my riding. This House is a great institution. It is worth defending, it is worth fighting for and it is worth keeping together. It is worth keeping all Canadians in Canada. Canada first.

_____________________________________________

9931

ORAL QUESTION PERIOD

[Translation]

LINGUISTIC SCHOOL BOARDS

Mrs. Suzanne Tremblay (Rimouski-Témiscouata, BQ): Mr. Speaker, my question is directed to the Minister of Intergovernmental Affairs.

On the subject of linguistic school boards in Quebec, the Minister of Intergovernmental Affairs insists he now supports the Quebec government's request. So far, however, his own government has refused to start the procedure for adopting the constitutional amendment as requested.

Why has the minister, although he says he agrees with the amendment requested by the Quebec National Assembly, not tabled a notice of motion that would make it possible to start the debate in the House? What is he waiting for?

Hon. Stéphane Dion (President of the Queen's Privy Council for Canada and Minister of Intergovernmental Affairs, Lib.): Mr. Speaker, we are very pleased to support the amendment we received from the National Assembly which will help modernize the Quebec school system in a way that has found support among all groups in Quebec society.

We received this proposal barely 48 hours ago. We intend to proceed without delay, with due respect for parliamentary procedure.

Mrs. Suzanne Tremblay (Rimouski-Témiscouata, BQ): Mr. Speaker, I asked the minister a straightforward question. I imagine when his students asked him questions, he had some answers. Why does he have no answers now that he is in the House? What kind of teacher is he?

I will repeat my question. He decided that hearings would be held. We agreed. However, he must first table a motion in the House. Let us stop being hypocrites, here.

Some hon. members: Oh, oh.

Mrs. Tremblay (Rimouski-Témiscouata): I know I am not supposed to say that, but I said it.

Last Monday, they came to ask us when we would be ready to proceed. We said: ``The Government of Quebec will proceed Tuesday, we will be ready Wednesday''. At the time, they were talking about going ahead on Monday.

The minister knows as well as I do-perhaps he does not because he told us the other day he was not very knowledgeable on the rules of procedure-but in any case, when does he intend to table this notice of motion? Ask the House leader, but when are you going to table your notice of motion?

Hon. Herb Gray (Leader of the Government in the House of Commons and Solicitor General of Canada, Lib.): Mr. Speaker, I think the acting opposition House leader forgot that her party and the Reform Party agreed that on Monday we would, I hope, pass the anti-gang bill. Did she change her mind? Does she want to renege on her commitment?

(1120)

Because of a previous agreement we cannot start with the resolution on Monday, but as we say in Parliament, the hon. member may rest assured that we intend to start consideration of the resolution as soon as possible after Monday.

Mrs. Suzanne Tremblay (Rimouski-Témiscouata, BQ): Mr. Speaker, with all due respect for the hon. member and his career as

9932

a parliamentarian, first of all, I am not the acting House leader but, as far as I know, the official House leader.

Second, we agreed on an agenda until next Thursday. Does this mean that the House will adjourn on Thursday? Does this mean the government has no intention of tabling the motion? Is that what it means?

In one of those end-of-session deals, we also suggested an approach that would meet both the government's objectives and ours. With the unanimous consent of the House, we asked the government to proceed today with debate on the motion so that Monday, the constitutional amendment could be referred to the Senate and then to the joint committee for 48 hours of hearings, and after that the amendment would come back to the House so we could vote on it before the House adjourns. Is the government prepared to accept this deal in its entirety, yes or no?

Hon. Herb Gray (Leader of the Government in the House of Commons and Solicitor General of Canada, Lib.): Mr. Speaker, the Quebec government waited at least two years to table its own resolution, and the National Assembly took three weeks to adopt the resolution after it was tabled. Why should the hon. member expect us to consider this very important constitutional motion within a shorter time frame than the National Assembly?

Second, the hon. member does not like the word ``acting'' connected to her position, and I apologize for the fact that I forgot she is leader of the acting official opposition. I may remind her that we are all here in an acting capacity, to a certain extent, and this is especially true of the present official opposition party.

* * *

IMMIGRATION

Mr. Réal Ménard (Hochelaga-Maisonneuve, BQ): Mr. Speaker, we now know this is a government delaying tactic. If I were the leader, I would not be too worried about our return.

My question is for the Minister of Citizenship and Immigration.

As we speak, a family from Belgium seeking to immigrate to Quebec is in prison. The father, the mother and the three children aged 9, 13 and 14 are at the Laval detention centre. The entire situation is based on a bureaucratic mess arising from misunderstanding, and false and erroneous information.

It appears that Mr. Truzewicz is being held on account of a robbery committed 18 years ago in Belgium. He however has shown that it was not he who committed the robbery, but someone using his car.

Is the minister prepared to examine this matter immediately so that Mr. Truzewicz and his family are accorded fairer treatment? A little understanding, please.

Hon. Lucienne Robillard (Minister of Citizenship and Immigration, Lib.): Mr. Speaker, I looked into this matter personally, but the Quebec privacy act precludes my commenting publicly on the facts of this case, and I think we should protect people's privacy as a matter of course.

If I have anything to say to the family today, it is to suggest that they comply with Canada's laws. That is the best approach, if they want to return some day.

(1125)

Mr. Réal Ménard (Hochelaga-Maisonneuve, BQ): Mr. Speaker, what is not a matter of course is our treating these people as if they were criminals, when they are not. This family is being treated like criminals. The parents and the three children have been thrown into prison.

Until the situation is clarified, could the minister arrange to release these people who are accused of nothing so that we can at least stop aggravating the situation these innocent people are facing?

Hon. Lucienne Robillard (Minister of Citizenship and Immigration, Lib.): Mr. Speaker, I would ask the member for Hochelaga-Maisonneuve to stop making political points with a human situation that is difficult for all concerned.

Clearly, everyone must obey Canadian law. I would hope the Bloc members would do the same in this country.

* * *

[English]

TOBACCO

Miss Deborah Grey (Beaver River, Ref.): Mr. Speaker, the ink was barely dry on the anti-tobacco legislation before they started changing and watering it down.

In public the Liberals talked a really good line about not caving in to the tobacco lobby and protecting the health of our young people. They seemed concerned then but then in private the health minister could not backtrack fast enough on tobacco sponsorship. In fact he became the host of ``Let's Make A Deal'' with the tobacco lobby. Tough on tobacco, I do not know. I am not sure.

Why did the Liberals cave in to the tobacco lobby, or was it always part of the pre-election plan? Who is going to answer that one?

Mr. Joseph Volpe (Parliamentary Secretary to Minister of Health, Lib.): Mr. Speaker, the hon. member ignores one very basic important fact.

Bill C-71 passed from this place to the other place and passed in the other place without any amendments. The bill still maintains all its integrity. It has all its objectives which the House supported, notwithstanding the reluctance of some members opposite.

9933

Miss Deborah Grey (Beaver River, Ref.): Mr. Speaker, the fix is in. The government has already passed the legislation and it talks about the other place. It is already talking about amending it again. It is absolutely ridiculous and it proves the Liberals are shameless.

They ought to be saying to the Canadian public that the only thing the Government of Canada cares about at the moment is the political fortune of the Liberal Party of Canada. How ironic this should be on the eve of an election.

First there was the Somalia inquiry. Then there was a $260 million payout for Pearson and Airbus, airports and Airbuses. Then came salmon, cod and now the anti-tobacco bill.

Why is the government so concerned about losing votes that it is willing to compromise its conscience?

Mr. Joseph Volpe (Parliamentary Secretary to Minister of Health, Lib.): Mr. Speaker, the only thing that is shameless is the poor attempt to try to score political points by distorting the facts.

The facts are still as follows. Bill C-71 went from the House to the other place and from there into the public domain with clear health objectives that remain as they were when they left this place.

We had already considered all other ramifications of the bill. Those ramifications are included in some amendments that were accepted here, for example that we would have an implementation period following which there would be consultation with all stakeholders and a review of some of those implications in the context of Health Canada's health objectives as stated in the bill.

Miss Deborah Grey (Beaver River, Ref.): Mr. Speaker, it is great to hear them talk so eloquently about the fact that they really care about young people and smoking, and then they say they are making these changes. I do not think the Canadian public cares what House it has been through. It is seeing the Liberal government caving in to the tobacco industry on labelling.

He did not mention that the Liberals were planning to cave in to the tobacco lobby after the bill was passed and amended in the fall with the arrogance of assuming that they will be here to make those changes. He did not mention the Liberals differentiated between a tobacco ad on a billboard and a tobacco ad on a race car.

Why should Canadians vote for a government that talks tough on smoking and then puts a Liberal logo on a race car?

Mr. Joseph Volpe (Parliamentary Secretary to Minister of Health, Lib.): Mr. Speaker, if we were to put a Liberal logo on a race car I am sure we would get all kinds of support. The hon. member knows full well that all the articles of the bill indicated that we would have restrictions on sponsorship. There was never any question of anything else.

(1130)

I might add for the member's edification that we would have an opportunity to get people to understand the objectives. There were restrictions but no bans. We said here are the health objectives and we carried those out.

The legislation went through the House with the health objectives in place, consistent with the Supreme Court decisions that generated this and consistent with all consultations we had in the field leading up to the legislation.

Nothing has changed, absolutely nothing. Canadians are pleased the Canadian government could get the legislation out of the Commons, into the Senate and into the public. She should applaud it.

* * *

[Translation]

PAY EQUITY

Mrs. Monique Guay (Laurentides, BQ): Mr. Speaker, one can tell there is an election in the offing. That is why the President of the Treasury Board and member for Hull-Aylmer would like to see the public service pay equity issue resolved, in his interest and that of his colleagues in the Ottawa area.

The Bloc Quebecois strongly urges the government to stop stalling over this issue and show respect for its 80,000 employees, who have been waiting for 12 years. Otherwise, the campaign trail might be bumpy, especially in Hull-Aylmer.

On this issue, the minister chose to make an offer via the Toronto Star rather than directly at the bargaining table. Why did he take this disrespectful approach to labour relations?

Hon. Marcel Massé (President of the Treasury Board and Minister responsible for Infrastructure, Lib.): Mr. Speaker, naturally, I have no intention of negotiating in this place something that should be negotiated between the employer, namely the Treasury Board, and its employees.

On Monday April 21, we will be putting on the table an offer regarding pay equity for the public service employees' union to consider. At that time, the details of the offer will be released, I guess, by the union itself.

People will be able to see for themselves what our position is. As far as we are concerned, we want both parties to negotiate in good faith, and we would not want to prejudice either the employees' position or that of the employer by discussing the matter in this House.

Mrs. Monique Guay (Laurentides, BQ): Mr. Speaker, the Treasury Board has called a meeting with PSAC for April 21 without providing an agenda for the meeting.

9934

Will the President of the Treasury Board confirm that he plans to put an offer on the table to resolve the issue, or is this just another stalling tactic because an election is coming?

Hon. Marcel Massé (President of the Treasury Board and Minister responsible for Infrastructure, Lib.): Mr. Speaker, as I just indicated, we will be putting on the table, on Monday April 21, an offer regarding pay equity. These matters have already been negotiated with the unions.

A settlement has already been reached with one of the unions, the one representing professional employees, and we hope not only that a settlement can be negotiated in good faith but also that it will be fair to both taxpayers and employees.

* * *

[English]

GOVERNMENT EXPENDITURES

Mr. Jay Hill (Prince George-Peace River, Ref.): Mr. Speaker, is there no shame in the Liberal ranks?

Some hon. members: No.

Mr. Hill (Prince George-Peace River): Pearson airport, $260 million taxpayer dollars; cancelled helicopters, $745 million taxpayer dollars; Brian Mulroney, only $2 million taxpayer dollars. He must be feeling hard done by. Canoe museums, armouries and hotels in Shawinigan.

Is there no new low the government will stoop to in its panicked rush toward an early election? Where are all those good jobs the red book promised?

Hon. Herb Gray (Leader of the Government in the House of Commons and Solicitor General of Canada, Lib.): Mr. Speaker, I wonder why the Reform Party is supporting the program of a party it says it opposes, namely Brian Mulroney's Conservative Party.

Why does the Reform Party want the taxpayer to spend $5 billion to $6 billion on helicopters that do not meet Canadian requirements? Why does the Reform Party want the taxpayer to spend $600 million instead of $60 million on an airport deal that was strongly criticized by Canadians across the country?

Are Reformers turning into a new set of Mulroney Tory clones?

(1135 )

Mr. Jay Hill (Prince George-Peace River, Ref.): Mr. Speaker, the people know Liberal-Tory, same old story. We are not the ones paying out taxpayer dollars for all these things.

It is now painfully obvious to every Canadian except Liberal MPs that infrastructure programs and other big government make work projects only produce short term jobs. Real job creation will only come through smaller government, balanced budgets and across the board tax relief.

Has the Prime Minister finally learned this, or does he still believe, as he said during the CBC town hall, that if Canadians cannot find a job they should simply move to where there is work, to where his government is spending their tax dollars, to Shawinigan?

Hon. Herb Gray (Leader of the Government in the House of Commons and Solicitor General of Canada, Lib.): Mr. Speaker, there is certainly a lot more to do in terms of helping Canadians who want to work find jobs, but we have made a very good start with a very good basis.

Some 700,000 new jobs have been created since the government took office. A further program of action was outlined in the very effective budget of my colleague, the Minister of Finance. We have laid the groundwork for further progress that I am sure will be achieved.

I wonder why my hon. friend on the one hand says that things have to be done at the local level, at the community level, but he is rejecting the successful infrastructure program which was designed, worked out and supported by the Canadian Federation of Municipalities.

The Reform Party has just given a slap in the face to thousands of mayors and reeves across the country and they will not forget it.

* * *

[Translation]

SATELLITE DISHES

Mr. Jean-Paul Marchand (Québec-Est, BQ): Mr. Speaker, this spring, hundreds of owners of satellite dishes will lose the last analog signal in French, that of Radio-Canada. While technological progress may be a good thing, these people should have been informed of that change, before investing over $1,000 in satellite dishes that will no longer work.

Why does the industry minister not conduct a real information campaign on this issue, so as to reach people, particularly those who live in rural areas, instead of merely publishing a brochure distributed by the sellers of satellite dishes, who do not always have an interest in telling the truth to their customers?

Hon. John Manley (Minister of Industry, Minister for the Atlantic Canada Opportunities Agency, Minister of Western Economic Diversification and Minister responsible for the Federal Office of Regional Development-Quebec, Lib.): Mr. Speaker, we said on several occasions in this House that it is the objective of Industry Canada to ensure that all consumers are informed and that the purchasing of satellite dishes should be made with the knowledge that the technology is changing.

9935

We recently issued a licence to Telesat Canada to provide DTH services to Canadians. I believe these new services, including LMCS and the cable broadcasting service to be introduced by telephone companies, will result in many technological changes all consumers should be informed of.

Mr. Jean-Paul Marchand (Québec-Est, BQ): Mr. Speaker, the Broadcasting Act provides that Radio-Canada's signals must reach the largest possible audience.

Given that the satellite broadcasting industry is still in its infancy, will the minister ask Radio-Canada to put off its decision to eliminate its analog signal for at least one year, so as to give consumers time to adjust to the technological changes he just mentioned?

Mrs. Tremblay (Rimouski-Témiscouata): Why not do like the Americans you like so much?

Mrs. Tremblay (Rimouski-Témiscouata): The minister is not allowed to speak to me directly. He must go through the Chair.

Mr. Manley: If I can get a word in, I would advise the member to direct his question to the Minister of Canadian Heritage. I would say to the hon. member that it is definitely the government's objective to ensure that all Canadians can receive Radio-Canada's signals.

* * *

[English]

TAXATION

Mr. Jim Silye (Calgary Centre, Ref.): Mr. Speaker, my question is for the finance minister.

Given that the finance minister has claimed he has not raised personal income taxes in any of his three budgets, why is it that the after tax disposable income per family is down by $3,000 per year?

(1140 )

Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, for eight years prior to our taking office this country had a Conservative government. That was when the decline in after tax income took place. Since we have taken office it has stabilized. If one takes a look at the projections of most economists, it is that it will be going up.

Mr. Jim Silye (Calgary Centre, Ref.): Mr. Speaker, I find this funny. I said since 1993 this is what has happened. It has nothing to do with the Conservatives. When they were over here they blamed the Conservatives. Now that they are over there, they blame the Conservatives. Liberal-Tory same old story.

I have a concern that the finance minister is basically using the UI fund as a surtax on his deficit cutting promises. He has said that if the cuts to the Canada health and social transfer are $7.5 billion, he would cut program spending by $9 billion. Revenues in the UI fund will hit $7 billion by the end of this fiscal year and revenues from personal income taxes are up by $4 billion after only11 months, and that is from the Fiscal Monitor.

If the finance minister has not raised personal income taxes, if he claims that he has not touched personal income taxes, why are tax revenues from personal income up by $4 billion? We have the time to handle this and answer it properly, so just take your time and answer it.

Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, there are a number of answers to the hon. member's question.

I think the hon. member would be interested in knowing that in 1966 the real net worth per household rose 2.7 per cent. What that means is that households have more assets, more money and are better off. Canadians are better off. I am sorry, 1996. When you are talking to the Reform Party you are lucky to get the century right.

Let me simply say that the reason our personal income tax revenues are up is that in the private sector there are 850,000 more Canadians working. That is why, that is the way it should be, and that is good news.

* * *

[Translation]

CANADIAN CULTURAL INSTITUTIONS

Mr. Maurice Dumas (Argenteuil-Papineau, BQ): Mr. Speaker, my question was for the Minister of Canadian Heritage.

This morning we learned that the CBC is toying with the idea of privatizing Bon Matin, a news broadcast now under the responsibility of Radio-Canada's news service. This represents yet another step on the road to abandoning great Canadian cultural institutions like Telefilm Canada and the CBC to the private sector, where the rules of ethics and accountability are not the same as those found in the public sector.

Would the Minister of Canadian Heritage agree that her government is responsible for dismantling Canadian cultural institutions and abandoning them to the private sector?

Hon. Marcel Massé (President of the Treasury Board and Minister responsible for Infrastructure, Lib.): Mr. Speaker, through its protection of Canadian cultural institutions in recent budgets, I think the Canadian government has shown that it values

9936

them greatly and that it intends to continue to protect them in the future.

Whether we are talking about Telefilm Canada, Radio-Canada or the CBC, the federal government has stated its objectives, and we intend to continue to serve the Canadian people, including the people of Quebec, in such a way as to promote the development of culture in Canada through strong and sustainable institutions.

Mr. Maurice Dumas (Argenteuil-Papineau, BQ): Mr. Speaker, the idea of starting to privatize the news broadcast by Radio-Canada is the direct result of Liberal cuts to the CBC. Instead of providing decent funding for the corporation, the Liberals diverted the money to the Copps fund, administered by the private sector and by Heritage Canada.

Why are the Liberals doing everything they can to weaken Radio-Canada and Telefilm Canada, instead of strengthening Canadian culture?

(1145)

Hon. Marcel Massé (President of the Treasury Board and Minister responsible for Infrastructure, Lib.): Mr. Speaker, when we are putting more than $1 billion annually into supporting our cultural institutions, there is no doubt that our government is showing that it wants to give effect to the principles of which we spoke and to continue to defend our cultural institutions.

As for the privatization of Bon Matin, I would like to remind the hon. member that the CBC is an autonomous agency in which we do not interfere. It is precisely because we do not want there to be any political interference that we are allowing the CBC to take decisions such as the one it may eventually take regarding Bon Matin. Opposition members would be the first to complain if there were any political interference. In this case, we are not interfering, so how can they complain?

* * *

[English]

INTEREST RATES

Mr. John O'Reilly (Victoria-Haliburton, Lib.): Mr. Speaker, financial institutions are charging 17 per cent interest on their major credit cards. Department stores are charging up to 28 per cent interest on their cards.

Is there any progress by the government on reducing credit card interest rates?

Hon. John Manley (Minister of Industry, Minister for the Atlantic Canada Opportunities Agency, Minister of Western Economic Diversification and Minister responsible for the Federal Office of Regional Development-Quebec, Lib.): Mr. Speaker, I want to thank the hon. member for his work together with other members of the House from all parties, especially the parliamentary secretary to the House leader, for their work in raising the awareness of Canadians on this issue.

What we have seen since they began to raise this issue is that consumer awareness in Canada has increased significantly of the fact that low rate cards are available, as well as new low rate cards that have come into existence; five new ones in the last few months. Now consumer awareness of these cards has increased from 30 per cent to 60 per cent, a very important contribution to the ability of consumers to make the choices that are in their best interests.

In addition, Industry Canada continues on a monthly basis to make available to the public full disclosure of information on the comparative rates and other costs associated with credit cards. As well, we have recently instituted on our web site, Strategis, the ability for consumers to use a credit card calculator. Inputting their own consumer practices, we can calculate for them which credit card is the best one for them to use.

* * *

AGRICULTURE

Mr. Jake E. Hoeppner (Lisgar-Marquette, Ref.): Mr. Speaker, my question is for the minister of agriculture.

In the last three and a half years this government has messed up every agriculture policy it has touched. It killed the Crow subsidy without having a competitive and efficient grain transportation system in place and as a result farmers have bins full of grain that cannot be moved.

Full grain bins and empty pockets have been Liberal and Tory policy for the past 130 years. How does this government expect farmers without cash to put in this year's crops?

Mr. Jerry Pickard (Parliamentary Secretary to Minister of Agriculture and Agri-Food, Lib.): Mr. Speaker, over the last several weeks we have been asked by many people to work on this situation and to put out a committee to look at it.

We feel that is not the direction to take. We feel the minister is working with the rail companies, with the product groups in the west trying to move this question forward as quickly as possible.

There is no question that grain has moved very slowly off the prairies this year. There was an avalanche which slowed things down for a week. We understand there was a major wash-out of rail lines a week ago which caused another huge slow down.

We sympathize with all the producers in the west. There is no question we want to see this move forward as quickly as possible. We are involving all the stakeholders and we are working with them to make certain these problems are clarified and sped up.

Mr. Jake E. Hoeppner (Lisgar-Marquette, Ref.): Mr. Speaker, this government has to realize if farmers had been given a marketing choice, as the Western Grain Marketing Panel recom-

9937

mended, they would already have resolved the transportation problems.

But because the minister arrogantly refused the recommendations of his own panel, the whole exercise was a waste of millions of taxpayer dollars.

How do the minister and the government plan to compensate farmers for his arrogance and negligence?

(1150 )

Mr. Jerry Pickard (Parliamentary Secretary to Minister of Agriculture and Agri-Food, Lib.): Mr. Speaker, the premise of the member's question is totally wrong. In absolutely no way has the minister, in any of the judgments made, done anything to cause delays in the transportation of grain on the prairies.

The member knows very well that the cause is due to problems within the rail companies. We are working with the industry and everyone in the industry knows we have been working with them to resolve the problem.

You don't have a good-

The Speaker: I know you are going to catch me the next time around.

The hon. member for Anjou-Rivière-des-Prairies.

* * *

[Translation]

CULTURE

Mr. Roger Pomerleau (Anjou-Rivière-des-Prairies, BQ): Mr. Speaker, my question is for the Minister of Foreign Affairs.

On February 28, in response to a letter from Quebec Minister of Cultural Affairs Louise Beaudoin, the Minister of Foreign Affairs stated that there was no question of Quebec artists being excluded from funding programs on political grounds.

If this is so, will the minister confirm that he has altered the objectives of his financial assistance program for touring companies by withdrawing the criteria linking departmental subsidies to the promotion of Canadian unity?

Hon. Lloyd Axworthy (Minister of Foreign Affairs, Lib.): Mr. Speaker, with regard to the new policies, we made it clear that decisions on individual artists would be based on each person's artistic merits. There is, therefore, no change.

Mr. Roger Pomerleau (Anjou-Rivière-des-Prairies, BQ): Mr. Speaker, that is not an answer to the question. I have asked the minister whether he had changed the criteria in the law, rather than in promises. We all know what happens to promises. We were promised that the GST would be scrapped, and it was not.

If the Minister of Foreign Affairs has not changed the criteria of his program, how then can he write Minister Beaudoin saying that the political opinions of Quebec artists will not be taken into account when his department awards funding to artists?

[English]

Hon. Lloyd Axworthy (Minister of Foreign Affairs, Lib.): Mr. Speaker, I wrote to Madam Beaudoin to ensure we cleared up the total misinformation that was put forward by members of that party suggesting that political views would be taken into account. Never at any time was that the case. It was only in the minds of the Bloc Quebecois members. They attempted to exploit it as a way of trying to drive a wedge. Never was it part of our guidelines.

All we said was that we wanted to ensure that when we promote the opportunity for Canadian artists to go abroad that it be the widest possible range of artists, young people, aboriginal people, people representing the various cultural groups. Never were political beliefs taken into account.

The Bloc Quebecois must apologize to the Canadian public for creating that kind of perception.

* * *

TAXATION

Mr. Dale Johnston (Wetaskiwin, Ref.): Mr. Speaker, just days before a needless federal election call the Liberals are spreading money around the way farmers would spread fertilizer. They obviously did not learn from the fact that Trudeau's 1984 patronage binge cost them the election. What a flip-flop from the days in opposition when they criticized the Tories for their pork-barrelling.

While it still has time, will the government commit to cutting taxes so that real jobs can be created?

Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, in the last budget we brought in over $2 billion worth of selective tax cuts, which will take effect over the next three years, for Canadians with disabilities, for students and for low income families. We brought in a series of targeted tax cuts directed where the impact will be the greatest.

Given that the government has reasonably restricted financial resources, that is the option which any reasonable government would take. The alternative recommended by the Reform Party is to bring in a broad based tax cut which would benefit the wealthy of this country. It would be paid for by cutting services which low and middle income Canadians desperately need.

Mr. Dale Johnston (Wetaskiwin, Ref.): Mr. Speaker, the minister is up to his old tricks of misquoting the Reform Party's policies.

9938

(1155)

For the last 78 months the unemployment rate has been high in this country. At no other time has it been this high except during the Great Depression.

If, as he claims, they are creating jobs, how is the minister prepared to explain to the 1.4 million unemployed Canadians that his policies are working?

Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, the numbers are very clear. There are 850,000 new jobs that have been created by the private sector since we have taken office. The hon. member says I have misquoted from their budget.

Let me quote exactly from false start: ``The federal government contributes about $3.5 billion each year to provincial welfare programs through the transfer payment known as the Canada health and social transfer. A Reform government will eliminate these payments''. That is a direct quote; 3.5 billion out of the pockets of those who need it most. That is not a misquote, that is what Reformers would do.

* * *

PEACEKEEPING

Mr. John Cannis (Scarborough Centre, Lib.): Mr. Speaker, my question is for the Minister of Foreign Affairs.

We are all quite aware of Canada's longstanding tradition of peacekeeping initiatives. Canada's contributions throughout the globe are second to none. One such initiative was the participation of Canadian troops in UN peacekeeping operations in Cyprus.

I would like to ask the minister today to inform the House of any new developments with respect to Canada's role in Cyprus that may help bring a just and peaceful solution.

Hon. Lloyd Axworthy (Minister of Foreign Affairs, Lib.): Mr. Speaker, I would like to thank the member from Scarborough Centre and the members from Don Valley East and Saint-Denis who have worked actively over the last several months to develop an initiative for Canada to assist in the reconciliation of the problems in Cyprus.

I am pleased to announce today that we have established a special ambassador, Mr. Michael Bell, to be the envoy for Canada in Cyprus and to work closely with the United Nations and to work with other countries. We think it is at the right moment with the proposed admission into the European Union. We hope that Canada continues to play the constructive balanced role that we played during peacekeeping in Cyprus. Now we can provide a constructive political and diplomatic initiative. If we can do that, we can help bring peace and demilitarization to that country and to that land which so desperately needs it. I am very pleased that we have been able to make that announcement today.

* * *

[Translation]

TAXATION

Mr. Maurice Godin (Châteauguay, BQ): Mr. Speaker, my question is directed to the President of the Treasury Board.

One of the recommendations of the Bloc Quebecois on tax reform concerned the Governor General's salary of $97,400 on which he does not pay a cent of income tax. Of course, the Minister of Finance did nothing about this.

Although all taxpayers must do their fair share to help the Minister of Finance fight the deficit and even the Queen of England now pays income tax, what justification does the minister have for the fact that her representative in Canada, with a salary of $97,400, does not?

Hon. Marcel Massé (President of the Treasury Board and Minister responsible for Infrastructure, Lib.): Mr. Speaker, accountants could go on about this at length. Is it better to pay him the salary of a Deputy Minister, around $140,000 or $150,000, so that he will have a net income of $97,000, or to pay him his salary tax free, because technically, the Crown cannot tax the Crown? That is a choice accountants have to make, and one way or another, it will not have much of an impact on the future of this country.

* * *

[English]

THE LIBERALS

Mr. Ted White (North Vancouver, Ref.): Mr. Speaker, just like the old line patronage ridden parties before it, this government is digging deep into the taxpayer trough so that it can hand out hundreds of millions of dollars of other people's money to last minute pre-election goodies for Liberal ridings.

If we add the cost of the election to the cost of the handouts and the cost of the MP pensions for the 30 or so Liberals who are deserting a sinking ship, Canadians are probably going to be out about $1 billion for this folly.

Other than being an excuse to shower Liberal ridings with largesse, could the government please explain the purpose of the upcoming early June election.

(1200)

Hon. Herb Gray (Leader of the Government in the House of Commons and Solicitor General of Canada, Lib.): Mr. Speaker, there has been no election call as yet, except perhaps in the minds of the Reform Party.

9939

Could the Reform Party please explain why its leader is not around here and is out campaigning across the country every day? Could the Reform Party explain why it is distributing copies of its false start program all over the country?

The Speaker: We are all aware it is getting close to the end, but we should not mention who is here and who is not.

* * *

POVERTY

Mr. Simon de Jong (Regina-Qu'Appelle, NDP): Mr. Speaker, my question is directed to the Minister of Human Resources Development. A Statistics Canada study shows that poor children are three times more likely to be in remedial classes than children from the richest families.

Since the government was elected the number of children living in poverty have increased while the transfer payments to provinces for social support programs and education have been slashed. The opportunity of getting out of the poverty cycle has been reduced.

Is this an example of the new Liberalism that oversees the entrenchment of a permanent underclass?

Mr. Robert D. Nault (Parliamentary Secretary to Minister of Human Resources Development, Lib.): Mr. Speaker, the member should be aware it is obvious that child poverty is the number one issue on the minds of all Canadians.

Therefore the agreement that we made with the provinces and the new child tax credit are intended to help alleviate the concern of all Canadians. To suggest that somehow any member of Parliament on any side of the House would not see this as a major challenge is quite disgusting, to say the least.

We are trying as governments to deal with child poverty. They are not interested on all sides of the House in having any underclass in our country.

That is the NDP philosophy. That is why people do not vote for the NDP. It tries to split people into interest groups. We try to deal with Canadians overall.

* * *

INFRASTRUCTURE

Hon. David M. Collenette (Don Valley East, Lib.): Mr. Speaker, my question is for the President of the Treasury Board.

The Canada infrastructure program created tens of thousands of jobs across Ontario. As we approach round two the Ontario government has proposed to exclude municipalities from the project approval process. To add insult to injury, it is rumoured that the amount of money to be allocated to the greater Toronto area is disproportionately low.

Will the President of the Treasury Board guarantee that before the program goes ahead with Ontario the municipalities will be given a meaningful role?

Hon. Marcel Massé (President of the Treasury Board and Minister responsible for Infrastructure, Lib.): Mr. Speaker, in early February I indicated to Minister Eves of Ontario that we were ready to have an agreement on the basis of the current guidelines.

Mr. Eves then proposed an approach where the province of Ontario selected all the projects and subsequently presented the federal partner with a list. This is a very substantial change from the current guidelines where the municipalities had the responsibility to identify and select the projects.

I cannot in good conscience agree the municipalities which pay one-third of the cost of the program would have no voice in deciding where the projects are.

It is true, according to the current list developed by Ontario that has not been fully revised by federal officials in particular, that the counties of Muskoka, Haliburton and Parry Sound received disproportionately high benefits relative to population. Coincidentally and to our great surprise, this is Minister Eves' riding.

The Speaker: I am glad you two members are getting close together.

_____________________________________________

9939

ROUTINE PROCEEDINGS

(1205)

[English]

PETITIONS

NATIONAL HIGHWAY SYSTEM

Mr. Mac Harb (Ottawa Centre, Lib.): Madam Speaker, pursuant to Standing Order 36, I would like to present a petition signed by many constituents in the Ottawa area.

They call on the House of Commons to ask the federal government to enact a national infrastructure program to help the country to rebuild its national highway system.

RIGHTS OF PARENTS

Mr. Jake E. Hoeppner (Lisgar-Marquette, Ref.): Madam Speaker, I have three petitions to present. The first one contains 51 names.

The petitioners call upon Parliament to recognize the fundamental right of individuals to pursue family life free from undue interference from the state and to recognize the fundamental right and responsibility of parents to direct the upbringing of their children.

I fully support the petitioners.

9940

EXCISE TAX

Mr. Jake E. Hoeppner (Lisgar-Marquette, Ref.): Madam Speaker, in the second petition the petitioners pray that Parliament not increase the federal excise tax on gasoline in the next federal budget.

NATIONAL HIGHWAY SYSTEM

Mr. Jake E. Hoeppner (Lisgar-Marquette, Ref.): Madam Speaker, in the last petition the petitioners call upon Parliament to urge the federal government to join with provincial governments to make the national highway system upgrading possible.

I agree with the petitioners.

HOUSING

Mr. Paul DeVillers (Simcoe North, Lib.): Madam Speaker, pursuant to Standing Order 36, I present two petitions on behalf of 133 and 25 constituents respectively.

They request that Parliament ask the minister responsible for the Canada Mortgage and Housing Corporation to suspend negotiations on social housing to the province of Ontario and to resume these negotiations only if the federal government proceeds under publicly declared principles with input from housing co-operative stakeholders.

NATIONAL HIGHWAY SYSTEM

Mr. John O'Reilly (Victoria-Haliburton, Lib.): Madam Speaker, I rise pursuant to Standing Order 36 to present a petition which indicates that 38 per cent of the national highway system is substandard.

Therefore the petitioners call upon Parliament and urge the federal government to join with provincial governments to make the national highway system upgrading possible.

SAFETY OFFICERS COMPENSATION FUND

Mr. Paul Szabo (Mississauga South, Lib.): Madam Speaker, over the last couple of years two petitions have been circulating across Canada. I would like to present them on behalf of my constituents of Mississauga South.

In the first petition the petitioners would like to draw to the attention of the House that our police officers and firefighters place their lives at risk on a daily basis as they serve the emergency needs of all Canadians.

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

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

TAXATION

Mr. Paul Szabo (Mississauga South, Lib.): Madam Speaker, I have presented the second petition over 150 times in the House.

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

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

* * *

QUESTIONS ON THE ORDER PAPER

Mr. Paul DeVillers (Parliamentary Secretary to President of the Queen's Privy Council for Canada and Minister of Intergovernmental Affairs, Lib.): Madam Speaker, I ask that all questions be allowed to stand.

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

Some hon. members: Agreed.

_____________________________________________

9940

GOVERNMENT ORDERS

[Translation]

INCOME TAX BUDGET AMENDMENTS ACT, 1996

The House resumed consideration of the motion.

The Acting Speaker (Mrs. Ringuette-Maltais): The hon. member for Anjou-Rivière-des-Prairies has 13 minutes remaining.

Mr. Roger Pomerleau (Anjou-Rivière-des-Prairies, BQ): Madam Speaker, I will not be taking my 13 minutes. I have been asked to be brief because a number of my colleagues wish to take part in this debate, as we know, and there is not much time left today.

I would just like to sum up what I have said. The government has had an excellent opportunity in the past two years, with the 1996 and the 1997 budgets, to completely rework the Canadian taxation system, to ensure that the rich people in this country pay their taxes, which is not now the case, as well as to reduce the gap that currently exists between the middle class and the rich.

(1210)

For the past two years, the government has opted not to revise the taxation system, on which the Bloc Quebecois has already done some in-depth research. Instead, it has preferred to dump almost the entire deficit reduction effort on the sick, on welfare recipients and students and on the unemployed, by chopping $4.5 billion from transfer payments to the provinces, much of which goes to welfare,

9941

hospitals and education, and taking $5 billion from the unemployment insurance fund.

The Prime Minister will most certainly be calling an election in the next few days, and will be wooing the votes of all those unemployed people in Canada whose benefits he has just cut drastically and who will find themselves without any benefits this fall after the election is over.

I would just like to close by wishing him good luck. In many parts of Canada and Quebec he is really going to need it.

[English]

Mr. Jim Silye (Calgary Centre, Ref.): Madam Speaker, I was expecting the Bloc member to make a few more comments and he caught me by surprise.

This budget implementation bill is obviously important. We certainly have to take a look at the financial status of the government and what is happening in Canada today.

There has been a lot of talk that very shortly the finance minister will be announcing a much lower deficit than he projected in February of this year when he said that the budget would come in at about $19 billion.

When we analyse the latest Fiscal Monitor put out by the Department of Finance two months in arrears, we see some interesting financial information. The Department of Finance releases this document which enables everyone to see what is happening on an ongoing basis. It is a very worthwhile and useful document.

Reform researchers have analysed it and have found some interesting information. Last year the government was able to predict a deficit overshoot by extrapolating final fiscal figures from the monthly series. The presentation I make today will show a bit about how the government is able to make its projections and predictions and keep telling Canadians where it stands.

Since the Fiscal Monitor is released with an average of a two-month lag, the most recent figures are from the February issue. It covers 11 months of the previous fiscal year, from April 1, 1996 to February 1997. The deficit at the end of February stood at $7.8 billion or $15.5 billion lower than the same period in the previous year of 1995-96. The improvement comes from increased revenues of $9 billion, reduced transfers to provinces of $4 billion, reduced public debt charges of $1.7 billion and reduced departmental spending of $400 million.

(1215 )

The Liberals will overshoot their deficit target by about $10 billion, mostly as a result of stronger than expected revenue growth, an international trend toward lower interest rates and large reductions in health and education transfers to provinces.

If members will recall, the finance minister projected a $24 billion deficit for year ending March 31, 1997 and then it was revised recently to $19 billion. This $10 billion overshoot is from the $24 billion down to about $14 billion instead of the $19 billion that he had projected.

The finance minister's department seems unable to make accurate forecasts. That generally reduces the level of confidence with which people view any of their forecasts.

During the Mulroney years, which was referred to today in question period, the department was always wrong in that it always overstated revenue growth. Now the department errs in the other direction, constantly understating revenue growth with the implication that taxes remain high as a result of this understatement.

It is just as bad to be wrong one way as it is to be the other. If a deficit is projected at X and it is exceed because certain things happen negatively in the economy, we have an excuse. If a deficit is projected at of X and it is lower, then it depends on what program we are trying to push.

I maintain that the finance minister is trying to preserve and protect the EI fund, which has now reached $7 billion, as a surtax on his deficit. Rather than making the program spending cuts that he projected and said he would, he is using this extra revenue from UI to cover off his and his department's slow progress in making the cuts that they promised to make.

Perhaps the minister would have faced more pressure to cut taxes had the department been more accurate in its forecast. This type of poor forecasting sets a dangerous precedent and calls into question its credibility. The one thing the Department of Finance should be serious about guarding is its credibility in making forecasts.

However, one never knows what happens with the Department of Finance, the cabinet and the finance minister. Perhaps there is some political pressure. Perhaps there are instructions to shape, present the numbers, present the worst case scenario and be overly conservative on revenues so that the pressure can be kept up to make the cuts. In either case, there is a variance that is never accurate.

Nobody says the forecast has to be within a billion dollars. However, if it cannot be within 15 per cent or 20 per cent of the projected number, whether it is a deficit or a surplus-let us say that a 20 per cent variance is acceptable either over or under-if it is exceeded then the fundamentals that are being used to achieve those budgetary projections, especially given that they are revised on a quarterly basis, have to be seriously questioned.

If it actually does go from $24 billion as was forecast a year ago February down to $14 billion, some people would say that was great. This is what the Liberal government says. However, I am submitting that is bad. It is just as bad as the Conservatives when

9942

they projected a $20 billion deficit and it ended up at $38 billion, $18 billion higher. That is more than 20 per cent the other way.

What we need is a Department of Finance that will not get brow beaten by any finance minister regardless of political party, that will present the facts as it knows them to be because it is the one constant from government to government. The officials who work in that department have a handle on the revenue stream. Unless a government decides to spend a bunch of money somewhere else, it is able, given the variance in the economy, to conservatively and within a 20 per cent variance predict the revenues. However, it is off big time.

Never before have I seen a government make so many fundamental changes in the way it does the financial statements and present the government's balance sheet. The government has moved things around. It has redefined certain types of spending. This has allowed the government basically to redefine program spending and claim that it is sticking to the percentage cuts that it predicted of 18 per cent when it is really only 8 per cent or 7 per cent. It has taken some program spending out and put it over into other areas, off balance sheet spending and it ends up claiming that it has met its targets when that was not the intent.

(1220)

The government was supposed to cut $9 billion and to date it has only cut $4 billion. We are going to go into an election. Is it going to promise to do the rest a year from now? The implication of bad forecasting is just as bad if one is better than expected rather than worse than expected.

If we take a look at the difference and review the components of the deficit reduction, we see from the ``Fiscal Monitor'' that the revenues of the government increased by $8.964 million. The government reduced the transfers to persons by $349 million. It reduced transfers to provinces by $4 billion. Departmental spending went down by $400 million in the last 11 months and the debt charges were less than projected at $1.7 billion. That is a variable that is out of the control of the government.

When things get really bad the government will say: ``Interest rates are not really something that we can control directly. Indirectly, yes, we can, by running a prudent government''. Interest rates are a factor of the global economy and how our dollar compares on an exchange rate basis with currencies of other countries. Therefore, to that degree it can have a huge variance and a huge swing and the government cannot be held accountable totally for that.

We notice that this comes to $15 billion. That is the total decline in the deficit. Of that $15 billion, the increased revenue as a percentage of these reductions is a 58 per cent component. The transfer to persons is at 2.3 per cent. The transfer to provinces is at 26 per cent. The departmental spending is only 2.6 per cent.

Wait a second, were the transfers to provinces not to be equal to the reduction in departmental spending? That is what the government said. It was going to lead by example. It was going to cut $9 billion out of program spending to justify the $7.5 billion reduction in transfers to provinces for the Canada health and social transfer. It does not seem to me that the government is on target for that. The debt charges as a percentage of the $15 billion improvement is11 per cent.

To sum up, according to our table, increases in revenue and reductions in transfers to the provinces made up a full 84 per cent of the improvement. Increased revenues through taxation, reduction in the transfers to provinces represent $13 billion out of $15 billion in improvement which is 84 per cent. Yet the government claims that 94 per cent of it is through growth in the economy.

Cuts in the federal government's own back yard make up only a 2.6 per cent paltry reduction. It is important to note that the tiny contribution of cuts to departmental spending correspond with what the Reform Party's earlier findings were, that the government has missed its cuts in departmental spending by as much as 50 per cent. We brought this out two or three weeks ago in question period, when we said that the evidence is that the government has only cut by $4.2 billion and it promised $9.5 billion.

It is important to note that the surplus in the employment insurance account is running at $6.8 billion after 11 months. Let us just round that out to $7 billion for the sake of discussion. This surplus represents a regressive form of deficit reduction tax and in question period today in quizzing the finance minister I referred to this as a deficit surtax.

(1225 )

The government should set EI premiums on an annual basis to match the funds required, within a tolerance level. If the government would set the premiums to match the benefits, the deficit would be $14.6 billion rather than $7.8 billion and it would be right on target.

I will give the finance minister some constructive criticism which will help to improve the economy. It will help to keep Canada competitive. It will help to keep interest rates as low as possible without outside interference. The $7 billion surplus in the EI account should come under general revenues. It should be applied against the deficit to reduce it.

If the government were to lower the premiums from the current $2.95 or $2.90 per hundred of insurable earnings up to $39,000 down to $2.20 and leave that money in the hands of the wage earner, their take home pay would increase. That would also reduce by 28 per cent what the employer has to pay. It leaves more

9943

money for the corporations to hire people, to invest and to expand. It will help to stimulate the economy.

There is the argument that EI and CPP are not payroll taxes, that they are investments. Regardless of what they are, the money is taken away from workers and corporations by the government. The rate at which the money is taken away is set by the government. If it is compulsory it is a tax. If it is voluntary, like an RRSP, if it is an inducement to invest, it is an investment.

Nevertheless, if the taxpayer was able to keep the money, I submit that more jobs would be created. More money would be spent. More money would be invested and more money saved. That would benefit a lot of Canadians.

I am not the only person who thinks that way. I am a businessman and I have thought this way for a long time. Wherever possible, keep taxes as low as possible and set the tax rate at the level required to pay for the programs which Canadians want.

In today's Financial Post is an article written by the business economist Dale Orr. He wrote: ``What is really happening is that Ottawa is using the present annual surpluses of $5 billion or so in the EI fund as a form of deficit reduction surtax''. The only thing wrong with that statement is that it is not $5 billion, it is $7 billion. The finance minister is using $7 billion of funds which come from employed workers and corporations, the intent of which is to pay for people who are unemployed while they are looking for employment for a certain period of time.

There is a huge surplus. The excuse is that some years there is a deficit. That is true. When I ran in 1992-93 the deficit in the EI fund was $3 billion. That gives a clue why in our zero in three budget we felt it imperative to make $12 billion in cuts immediately, faster than the paltry cuts the government has made in its program spending, because we did not count on a huge surplus in the EI fund.

This is a gift to the finance minister which he has misused. He has a golden opportunity to stick to his party's platform, to stick to his party's caring, sharing, forgiving and giving government, doing it slowly, doing it properly, not punishing people unduly, and yet he will not share the $7 billion. He has a golden opportunity.

He might do something during the election campaign. Maybe that is the selective tax cut that he will justify because I agree we cannot have a broad based tax cut.

Today he misrepresented our platform when he said that the Reform Party would implement a broad based tax cut. That was not true. He told half the story. He should be spewing forth the truth when he talks that way.

(1230)

He should be saying that once the budget is balanced the Reform Party would offer broad based tax cuts that would average $2,000 per family by the year 2000. That is why we say $2,000 in 2000. It takes a year or two to balance the budget. We say no tax breaks until then, no tax cuts until then.

Then we raise the personal exemptions, the spousal exemptions, to $7,900. We will get rid of the federal surtax of 5 per cent, the 3 per cent, and all the extra taxes we will not need. That will leave the money in the hands of the people who need it, in the hands of the people who know how to spend it better to look after themselves. This in turn will reduce the pressure on welfare programs, reduce the pressure on all the other social assistance programs the government has to provide, as it should to those who truly need them.

I will quote further from the Financial Post to support my argument and submission that there is an opportunity here to do something with the $7 billion in the EI fund.

A faster reduction in the premium rate would help lower business costs for employers, whose share of the premiums is proportionally more. It would boost take home pay, especially for lower income workers. The combination would contribute to higher consumer spending, profits, economic growth and jobs. Some studies put the employment potential at up to 200,000 jobs.

A potential for 200,000 jobs just be lowering the unemployment premium rates, EI rates, to $2.25 or $2.30 from the current $2.95.

These are not from the Reform Party. The finance minister takes off his glasses, waves them and says that half-baked numbers do not work. They were from a business economist. He is not the only one. I could quote many different sources and many economists who argue and maintain this point of view.

High taxes kill jobs. Payroll taxes kill jobs. Why does the finance minister not something when he can and while he can? We have a surplus. We do not need the $7 billion in the EI fund. We should keep a base of $3 billion to $4 billion, keep that surplus and reinvest $3 billion of it with the Canadian public.

Maybe I should not tell him that, because if he offers that he might come back here with a majority government again. We really do not want that. We want a fresh government later this year.

I will summarize a few more items from the Fiscal Monitor. Transfer payments in the 11 months since April 1996 to February 1997 have decreased. Transfer payments to individuals, which includes the elderly benefits and the EI benefits, net out at a decrease of $349 million. It increased the elderly benefits by $512 million and decreased EI benefits by $861 million.

9944

Not only is what it is collecting on EI greater than what needs to be put out, but the benefits it is paying out are going down from the previous year by almost $1 billion or $861 million.

Transfers to governments have been reduced by $4 billion. Of that $4 billion, $3.685 billion is the Canada health and social transfer after 11 months. That is where it hits.

The government claims it is the fault of provincial governments because it is their responsibility to look after health care. If they close hospitals, we should not blame the Liberals. If they have to lay off nurses and pay doctors less, we should not blame them. We should blame the provincial governments, provincial health ministers, provincial premiers and provincial treasurers. How foolish is that?

In its first budget it said that we all must sacrifice. I support the government in reducing the Canada health and social transfer by $7.5 billion. That is not my criticism.

(1235)

The Liberals said that we had to share, sacrifice and make do with the same or less money. They were to show leadership by example. They were to cut federal government program spending outside the Canada health and social transfer, outside the transfer to provinces. They were to reduce the rest of the spending of government by a greater amount than the $7.5 billion. They were to reduce it by $9.5 billion. To date, after 3.5 years and projected to the end of four years, the government will not be there. The Liberals will have only made $4 billion with those cuts. That is from their own information.

This is not being made up by the Reform Party. I respect the Liberal member opposite who said politicians should represent more of the facts rather than distort or give their interpretation of them. That is what I am trying to do. The government has fallen far short.

Other transfers and subsidies add up to $128 million. Total program spending has decreased by $4.778 million. If the government were truly trying to show leadership by example, after four years of governance the government should be closer to 50:50 in program spending even in the past year. In fact the number should be higher than $4.7 million. The $3.6 billion reduction in Canada health and social transfer is fine. That was projected. It was to be phased in over a period of time, two or three years, which is the right way of doing it.

Cuts in program spending should have matched. Rather than $4.7 million, the real embarrassment to the finance minister is that the number should be $7.2 million. He has failed to pressure, to push, to keep the other cabinet ministers in line, and to force cabinet ministers, deputy ministers and assistant deputy ministers to clean house, to shape up. This is what the Canadian public wants.

Those are the direct words and orders from the finance minister and the President of the Treasury Board. They set the target and they are missing it big time. That is the embarrassment in the Fiscal Monitor.

That is what it revealed. That is the failure of the finance minister. He is actually $4 billion behind the cuts he promised to make when he asked all Canadians to sacrifice and all levels of government below this one to figure out ways to provide the same level of service with less money. The federal government cannot do it.

The President of the Treasury Board rose today in question period with a set up answer from the former minister of defence. He talked about infrastructure and whether municipalities would be guaranteed the money would go to the programs they want. Then he lambasted the finance minister from Ontario. He quoted him by name. He took after the premier of the province. Those two gentlemen are in provincial politics. They are not even in the Chamber. They are not here to ask a question or to defend themselves. That is shameless. It is an embarrassment to have a member of the government do that. It was cheap, political partisanship against a level of government that is not even here.

He should hang his head in shame. He should write a letter of apology saying that he is sorry and that he got carried away. He should indicate there is an election coming and the former minister of defence asked him to embarrass the local government in Toronto so that he can boost his chances of getting re-elected.

That is crap. They believe in infrastructure but I do not. I criticize all levels of government for going forward on short term jobs. There is only one taxpayer. It is an admission by all levels of government that they have let infrastructure deteriorate, if that is where it is truly going.

The first responsibility of a municipal government is infrastructure: bigger projects, provincial and bigger than that, federal. Where have these guys been for 10 years if all of a sudden we have to spent $6 billion or $9 billion on infrastructure?

To pick on people in another level of government who are not in the House and cannot defend themselves is a new level of cheap political partisanship I have not seen before. The government has made its deficit reduction mainly by cutting the transfers to provinces. Some 77 per cent of this year's deficit reduction has been through the Canada health and social transfer. It is undeniable. The facts are here. I am quoting the government's own statistics.

(1240)

We have proof that an overwhelming majority of the improvement in government program spending comes from cuts to the CHST. I have already said what the percentage. When we include other transfers to provinces, reductions in transfers accounted for a

9945

full 84 per cent. Eighty-four per cent of government spending was by way of downloading. The provinces were given less. They were told to handle it, and the government said it cut spending. The government says it has done its part and now it is the provinces' turn. What a way to do it.

It promised to cut program spending by 18.8 per cent and then only reached 9 per cent and changed the definition of program spending. It took from here and there and suddenly $4.5 billion because 18 per cent again. How does $4.5 billion become 18 per cent? Once again it is perception.

I will speak later on Bill C-95, the anti-gang legislation. The Prime Minister in his autobiography said that in politics perception was everything. What a shame. It is too bad that in politics reality and facts cannot be everything. It is too bad those in the traditional parties who were here before us believed in that perception. Why not deal in truth and facts? Why not represent reality and assess what is really happening and then propose legislation to solve the problem?

In a 1995 speech to a symposium on budget deficits sponsored by the Federal Reserve Bank of Kansas City, the Minister of Finance stated:

We were nevertheless determined not to cut back our support to the provinces by any greater percentage than we were hitting programs in our own backyard.

If he wants to refer to our zero in three, which I will touch on that a little later, I will refer to what he said in 1995.

Cuts to provincial transfers made up 84 per cent of the total spending cuts to date this year. Departmental reductions have made up 8.4 per cent of the spending cuts. The reduction in transfers to the provinces represents a 16.2 per cent cut over 11 months. The $400 million in departmental spending represents 1 per cent.

In the second budget he told us what he was to do with the CHST. He made the promise worldwide so it must be something he believed in and something he told cabinet he would do. He was determined-I would assume cabinet and the rest of the Liberal caucus were determined-not to cut back support to the provinces by any greater percentage than they were hitting programs in their own backyard. All they have cut in their own backyard to date is $4.5 billion. What they have cut by downloading to provinces in other areas amounts to $8 billion.

How about that for promises? That party is good at breaking promises made in its election platforms. The Liberals got elected on renegotiating NAFTA but did not do it. They got elected on not having a third runway in Toronto. They got elected on saving taxpayers money on Pearson airport but did not do it. It will cost us close to $600 million. They got elected on getting rid of the GST but did not do it. In fact they entrenched it.

Talking about flip-flops, when the finance minister was on this side of the House he said that if a provincial sales tax is ever combined with a goods and services tax the GST is entrenched forever. What has he done as finance minister? There is a GST and a BST in the three Atlantic provinces that were signed on by three Liberal premiers, one of whom quit because he saw the writing on the wall. I am looking forward to the provincial elections to be held in another year or so when the effect of the harmonized sales tax works through the system. He has entrenched this GST, a terrible thing which is against his own principles. There are two examples right there.

(1245)

The government is skimming more and more of the economy's weak recovery in the form of higher tax revenues. In April through February 1996, the government collected $3.5 billion more in personal income tax alone. Part of this increase was due to technical factors which affected the timing of income tax payments while the remainder was due to the effects of inflation in an unindexed graduated rate system with frozen basic exemptions.

Today I asked the finance minister, if everything is so good, why is the after tax disposable income per family down by $3,000? If the minister has not raised personal income taxes over the past three years, why has personal income tax revenue in this past year alone been $4 billion more? And why has personal income tax revenue overall been between $10 billion and $12 billion? In response to my questions, the finance minister cited two or three things and then he stopped. The rest of the truth he failed to spew out was that he had tinkered with the personal income tax system, that he had removed some personal exemptions and basic deductions and that he had closed a few tax loopholes. He failed to say the one big thing he did, which represented a lot of revenue and which he would not talk about.

There is a law that unless inflation increases by 3 per cent in the economy the personal exemption will stay frozen. In other words, an individual gets $6,500, the spousal deduction is $5,900 and it will not be touched until inflation hits 3 per cent. It is 2.5 per cent. It has averaged about 2 per cent in the past five years which adds up to 10 per cent. Those people who have seen their incomes go up by 10 per cent because of inflation are in a higher tax bracket. They still get the same low personal deduction of $6,500 and therefore they are paying more in taxes. And he says: ``I have not raised personal income taxes''. Well, yes he has.

The Reform Party recognizes that. We also recognize the need to ensure there is sufficient revenue so that programs can be paid for, health care and education spending can be increased by $4 billion and we can work toward a balanced and surplus budget. Then the first thing we would do is raise the exemption level, both personal and spousal to $7,900. We recognize that stay at home parents are

9946

being taken advantage of and to help the family decide on its lifestyle and not force both individuals in a marriage to work outside the home. We recognize that what anybody does when they stay at home is just as valuable as when they go out to work. That is why we would make that exemption the same. That is my story and analysis of the ``Fiscal Monitor''.

Let me get back to the Liberals' favourite tax. The GST and the HST are entrenched forever in our lives. This goes against the very words of the finance minister when he was in opposition. I could not do that and I would not do that. That is not why I would be here. I would consider myself a hypocrite if I did that.

Everybody in the country ranted and raved against the Conservatives on the GST. Eighty-three per cent of Canadians did not want the GST and the fools still put it in because they said they knew what was best for us. ``Leadership isn't about popularity'', said the former Prime Minister, ``it is about doing what is right for the people, and we know what is right''. How the heck can 83 per cent of Canadians be wrong?

The Liberals rightly attacked it and attacked it. I am not sure what the NDP did but I know the Liberals attacked it. I have quotations from the Minister of Transport, the Minister of Finance, the Prime Minister, everybody attacked it. They said that it was a big issue. They had a big pre-election meeting in Toronto at which they decided to abolish the GST: ``We're going to kill it, we're going to scratch it, we're going to get rid of it''. They got elected partly on making that promise door to door. That promise was probably a huge factor in their election.

I hope the Canadian taxpayer remembers what this Liberal government did to get itself elected. Liberals promised jobs, jobs, jobs. That was their big slogan. There were 1.6 million people unemployed. Today there are between 1.4 and 1.5 million unemployed and just as many if not more underemployed. Did the Liberals keep their promise? Did they create the jobs? Decide.

(1250)

Then we have the GST. Their promise went from abolishing it, killing it, scrapping it, to replacing it, harmonizing it. After two years they went from killing to replacing to harmonizing. If we read the promise in the red book, it states that they would harmonize with a system that was revenue neutral. This is not revenue neutral. It cost the Canadian government $961 million to pay the Atlantic provinces for their loss of revenue from lowering their provincial rate. They call that paying Canadians. I call that a cost.

When the Liberals say they have solved the problem and have kept their promise, it is only in three provinces. Surely to goodness a promise to harmonize would include all of Canada, would include at least Ontario where they have 98 out of 99 seats. They even failed to impress Ontario with their big harmonized sales tax scheme. Do members know why? It is because the Ontario government is smart enough to recognize how much it will hurt consumers in the long run.

After all, a goods and services tax, no matter how it is sliced, no matter what the arguments are-that it helps businesses to keep the cost of the product low, that it simplifies the system and that they would have lower overhead-which are all true, but the one thing they stop short of saying is that no matter what the rate is, whether it is 1 per cent, 7 per cent or 15 per cent, guess who pays. The consumer pays. They pay pre-tax. They pay tax on their income. They have after tax dollars and they have to pay tax on that.

What everyone ends up doing in this country, if they work nine to five, is work half a day for the government and receive half their pay.

How much time do I have left, Madam Speaker?

The Acting Speaker (Mrs. Ringuette-Maltais): You are out of time.

Mr. Silye: Have I had my 40-minute intervention?

The Acting Speaker (Mrs. Ringuette-Maltais): Yes.

Mr. Silye: Really, I was just getting warmed up.

Mr. Simon de Jong (Regina-Qu'Appelle, NDP): Madam Speaker, my intervention will not be 40 minutes but I wish to put a few things on the record.

It is of course always a concern for New Democrats, particularly a New Democrat from Saskatchewan, to make certain that the books are balanced. I know many people have accused the New Democratic Party of being the party of tax and spend and running up high deficits. However, the background and history of the leadership of both the CCF and New Democratic governments in Saskatchewan has shown that historically we want to maintain a balanced budget.

The Regina manifesto put it so well: ``No CCF government will run its public finances to help feed the parasitic interest receiving classes''.

Having said that, it is worth noting that the attempts by the present Liberal government to balance its books have basically been done on the backs of working Canadians, the poor, the elderly, the young and the sick.

As the previous speaker from the Reform Party so aptly put it, most of the money saved by this government has been because of the cutbacks to the Canadian health and social transfer payments. Huge sums of money that should have gone to the provinces to help pay for medicare, post-secondary education and the increased number of people on social assistance rolls because of the lack of job opportunities, are the people who are paying for the deficit reduction of this government.

9947

As well, major hunks of surpluses of the employment insurance fund are going to general revenues to help further reduce the deficit. Yet let us not forget that it is not the poor and not the unemployed and it is not our social programs that have created the debt in the first place. A Statistics Canada study in the early nineties determined that 50 per cent of the debt was due to high interest payments. Some 44 per cent of it was due to loss of revenues. Only 6 per cent was due to increases in government expenditures of which I believe only 4 per cent was due to increases in government expenditures on social programs.

(1255)

It was not the increase in social programs that created the debt in the first place. It was the reaction to the runaway inflation of the seventies that created the high interest payments going to 18, 19, 20 some per cent that catapulted the deficits into huge debts. Then it was the loss of jobs, plus the tax loopholes that mainly the Liberal government introduced in the 1970s that created a loss of revenue which in turn also accounted for 44 per cent of the debt.

Only 6 per cent of the debt is because of increases in government programs and only 4 per cent of that is due to increases in social expenditures. Yet who are the people who paid for the reduction of the deficit? It mainly comes on the backs of working people, the young, the sick, the unemployed and the poor.

A few years back Jesse Jackson in the United States coined a phrase that ``it wasn't us poor people who sat and indulged ourselves at the banquets but we're the ones who are stuck with the bill''. That is as true for people in Canada as it is in the United States.

The wild government expenditures of the 1970s that created runaway inflation, that saw the horrendous growth of assets, stocks, bonds and real estate, both in Canada and in the United States, those are the people who benefited. Yet they are not the ones who are paying for it. Their effective tax rates have actually declined while the taxes for working and middle class Canadians, even for poor pensioners, have increased while their benefits have decreased.

This system is wrong. It is morally wrong. It is economically wrong. It is a bankrupt system that does not bode well for the economic health and well-being of our country. The mismanagement and the wrong economic policies of this government and the previous Tory government have led us to a position where we have this huge mountain of debt that will take I do not know how many generations to pay off.

One of the items also included as a tax item in this bill that we are debating, Bill C-92, is a change that resulted from the Supreme Court decision on what is called the Thibaudeau case. It was determined that rather than having the higher income earner paying child support and family support payments being able to deduct those payments from his or her income tax, it should be the recipient of the payment who actually had to pay for those costs.

At the time it was recognized that this would mean less money to families for child care and that it would mean an increase in government revenues. In fact the budget papers for 1996 suggested that as a result of the Thibaudeau court case the government will get a windfall of $120 million in the third year in increased tax revenues and more in subsequent years.

(1300 )

That is $120 million extra which is being taken away from families. In most cases the male makes child support payments. They cannot deduct those payments from their income tax. The low income earner is not able to deduct child care expenses and the government is ending up with more money.

While we support it in principle, it is of concern to us that $120 million is being taken away from families. That money should be going to support children.

I would like to place the position of the New Democratic Party on the record today. We would want this section of Bill C-92 to be reviewed on a yearly basis to determine what impact it is having on child care and the families raising children.

Our concern is the impact this will have on children, particularly those children living below the poverty line. We are concerned that in the end it will mean some $120 million being taken away from the needs of those children. On behalf of the New Democratic Party I would like to put on record our concern and our wish that this section be reviewed on a yearly basis.

The tax system is essential for a government to raise the revenues it needs to do the things which government should be doing and as well to effect a redistribution of wealth in the country. Our position has always been that such a system must be fair and equal to all Canadians. That is why we initially supported the suggestions and reports which recommended that a dollar earned, whether from profits, commissions, dividends, increases in capital gains or by the sweat of one's brow, should all be taxed equally, as the Carter commission proposed. We have never come close to achieving that ideal. What Carter said was that a dollar is a dollar and that the tax on that dollar should be equal.

Corporations should be paying their fair share. We have seen during Liberal and Conservative regimes more tax loopholes being given to the rich and the powerful. While small and medium size businesses are struggling to keep their heads above water, creating jobs for Canadians, the very large transcontinental corporations are able to get by without paying any or very few taxes.

9948

It is a crime that one family should be able to move $1 billion offshore and not pay a cent on the capital gains earned on that money. It is a shame that would be allowed when poor pensioners earning a little over $1,000 a month have to pay tax.

The tax system is unfair. That creates cynicism and encourages average Canadians to cheat. The average Canadian will say ``why should I pay this amount of money when the rich and the powerful, those who have the connections to the Minister of Finance and the Department of Finance, are able to get special rules and omissions so they do not have to pay their fair share of the taxes?''

This unfairness must be corrected. We will continue to fight for a fair and equal tax system so that all Canadians will be taxed fairly and equally.

(1305 )

I find it interesting that Bill C-92 should be debated in what is presumed to be the end of this Parliament with an election being called soon.

Taxation is what Bill C-92 is all about; who has the power, how it gets exercised, who benefits from the power. As long as there are political parties in power that are financed by the banks, international traders and the wheeler and the dealers, by the mighty, the powerful and the wealthy, there will never be true democracy, true equality and a true and just society. It will be the poor and the working people who will pay the price for deficit reductions, as we have seen under both the Liberal and Tory governments. It will be the poor and ordinary working middle class Canadians who will pay the price.

The struggle will go on and in the coming election we will make certain this becomes a major issue.

Miss Deborah Grey (Beaver River, Ref.): Madam Speaker, it is good to have a look at some of the amendments to the Income Tax Act that the government is proposing.

Canadians are probably saying we need do not to amend the Income Tax Act; we need to totally eliminate it, rip it down to nothing and start again from scratch. The Income Tax Act is absolutely enormous. There are volumes and volumes to it. It does not seem that regular Canadians are able to fill out their income tax returns anymore because it has become so complex.

It seems there are so many rules to follow and so many loopholes that people can slip through, it is almost impossible for anyone to obey the Income Tax Act or make any sense of it.

When Bill C-92, an act to amend the Income Tax Act, the Income Tax Application Rules and another act related to the Income Tax Act came forward, most people would wonder what in the world it means. In either official language it does not seem to make sense.

However, I would like to look at some of the specifics and talk about tax credits for individuals. It enriches the education tax credit, the tuition fee tax credit and credit for infirmed dependants. I guess there is some merit in trying to help students, but I am not sure this is the right way to go about it. I am sure that members on both sides of the House know that students want a good, solid education and a real job at the end. The government is tinkering with the Income Tax Act and offering them some token help, and it probably is a start. However, I think they would want more substantive reforms to make sure that when their formal education process is finished they will be able to get a job.

It says that the education tax credit is increased from $80 a month for those attending school to $100 a month. For a student in school for eight months a year, the average university or college year, the increase means the education credit goes from $109 to $136, a $27 increase.

Going out for supper could easily cost $27. This is not a tremendous amount of cash, no real encouragement to a serious student. Students are not looking for a $27 or $30 change but substantive changes from a government that is continuing to spend billions and billions more every year than it is bringing in.

I know many students are fiscally responsible. Some may be living on a student loan. They have resource limitations in terms of part time jobs. However, they see their government spending money hand over fist, $60 million to $70 million a day more than it is bringing in. I do not know how they handle their frustrations when they see people who are running the country, the role models they are supposed to look up to, spending $60 million to $70 million a day more than is being brought in and then saying to students ``sorry, we have made some tremendous cutbacks in your areas but we will be kind and generous with this $27 increase''. That is pretty pathetic.

(1310)

On the government's huge cuts to provincial transfers with respect to education, $7.5 billion cut to the Canada health and social transfer has meant huge tuition fee hikes on Canadian students. Twenty-seven dollars will produce very little assistance in this.

It is incredibly incongruous it is for people to say ``we are concerned about your welfare, we really want to make sure you get a quality education, we care but we just chopped $7.5 billion''. They may want to blame it on the Tories.

In two Parliaments we had the Tories blaming the Liberals when they were in opposition and now we see the Liberals blaming the Tories when they are in opposition. This place is just a vicious circle that goes round and round. I do not think the Canadian public really cares who started it or who is to blame, I think it wants it

9949

ended and right now. This kind of legislation certainly is not going to do it.

When Liberals say they are the great defenders of medicare and post-secondary education it is unfortunate they do not live up to the commitment. When the Liberals were in power in 1965 they gave the commitment when medicare came in that they were going to pay 50 per cent of the funding of medicare. With this latest budget they are now down to 16 per cent. What do you expect the provinces to do?

Now that post-secondary education is included in the Canada health and social transfer I can understand why students are upset. And yet the government says it is the defender of post-secondary education. I think it is a pretty weak defence and if it is going to offer $27 it is more of a slap in the face than what it is intended to do.

A $7 billion cut. For those who attack my party and say we will rip medicare apart and we will not help students, do not forget that, as the myth goes, which we hear in question period here every day, we will take grocery money from old ladies and will dismantle pensions. That is not true.

The Liberals looked after the MP pensions very well in this Parliament, tightening their belts, austerity measures. Instead of $6 to one employer-employee contribution, they have really sucked in their belts and they are giving $4 to one employee-employee contribution. That is not sitting very well across the country.

We understand the frustration students feel. The guarantee was made that the Liberals are the great defenders of health and education. Then they regularly, every day in fact, shriek about the fact that the Reformers are going to dismantle pensions and health care. That is not true.

Reformers have committed to balance the budget and then reinvest $4 billion into health care with these kind of dollars in the late 90s, because wherever you go across the country and ask people their priorities, they say health and education.

If those are the priorities, we respect that, but something else has to go. If we have a federal government with such a voracious appetite that it is spending billions of dollars a year more than it is bringing in, then something has to go.

When I see this government talking about budgets, finances and what a wonderful job it has done in terms of getting the deficit under control, it is by tax increases and revenue increases, not by cutting spending. This is seen in the public accounts where it says it has increased revenues and taxation by $25 billion a year. I think the Canadian public would say shame. I think students in terms of the tax credits for individuals are not going to be blinded by that.

What a pathetic day it is when we say to our young people that we are looking after them but then we turn around and slice and slash and then blame other political parties. Any political party will do for a scapegoat. ``Your more terrible than we are'', they say. Let us just fix the problem. That would be a far wiser thing to do.

(1315)

If we look at the tax codes and some of the changes that are being made in the bill, we realize that the government has maintained its policy of adding to the complexity of the tax code, not by adding to the simplicity of the tax code.

People want things simpler when it comes to income taxes and the Income Tax Act, but the government has adjusted the rules for various interest groups. I am not surprised by that. For years-whether it was the Liberals or Tories really does not matter-millions of dollars have gone to special interest groups that have one function and one reason only, that is to come to Ottawa to lobby for more funds. Governments give money to interest groups that come back to Ottawa to ask for more money, and it goes around and around. I call it the royal flush.

The government has also removed legitimate reductions so that overall Canadians have faced an increase in taxation. Earlier today in question period the finance minister said that Canadians were far better off. Canadians will be doing their taxes this week because April 30 is the deadline. I do not think there would be very many who would be supportive and say they feel better in terms of their disposable income or a whole lot better thinking they have more cash in their pockets. That is not true. They can ask their family and friends. They all pay taxes.

I do not think anyone is jumping up and down, whether in the province of New Brunswick where I just came back from this morning or on the west coast. People are not feeling really cheery that they are paying less taxes. They know they are paying more. They have stubs and are sending in their income tax forms this week. They know perfectly well what is happening.

Government members can talk and blather all it wants in the House of Commons but it is irrelevant. People are paying more money in taxes. They have less disposable income. The main point is that people are frustrated with a system that keeps saying it is okay, it is looking after them and it has their best interest at heart. Meanwhile the government is winking one eye and has a hand on their wallets.

A certain trust factor is missing between the Canadian public who is filling out its income tax forms right now and the people who are saying: ``Trust us. We are from the government. We are here to help you''.

Taxes have increased since 1993. Again today the finance minister was trying hard to make us believe that it was under the Conservative government that taxes increased. We have had a few

9950

budgets now from this government and that is simply not true. By fiscal 1998-99, next year, the government will collect $30.4 billion more in tax revenues than it collected its first year in office.

It would be difficult to blame the Conservatives for that. The Liberals have been in office since 1993. They say it is the fault of the Tories, that they are responsible. However, since 1993 they received $30.4 billion more in tax revenues than they collected in their first year in office.

Then there are tax hikes. I have heard for 3.5 years in Parliament that the lousy Tories raised taxes time and time again. The Liberals were to be better at it. What do you think? The Liberals have hiked taxes at least 36 times, not including the multi-billion dollar hikes to federal user fees over the same period. There is more money going from an individual's pocket to government as a tax.

The finance minister can call it an investment. He could call it increased revenues for the new, beautiful harmonized sales tax down in Atlantic Canada. They are not really happy about it in New Brunswick. They voted in a Liberal government because it was going to scrap, kill and abolish the GST. It has been entrenched further. It is thicker and deeper in Atlantic Canada with this new blended sales tax.

``We are from the government and we are here to help you''. The people in New Brunswick did not feel that way this morning. Government members know it and I know it. They have increased taxes.

(1320)

Canada pension plan premiums were increased by 73 per cent. The government says that is an investment and not a tax hike. I am not so sure I want the kind of investment the finance minister is trying to offer people of my generation and people who are coming along behind. We are going to pay 10 per cent of our income into a Canada pension plan premium rate so that when we are 65 years old we will get a maximum of 8,800 bucks. That will be nowhere near $1,000 a month for people in their early twenties when they reach 65 years of age. It will be an $8,800 a year maximum payout for CPP. That is not good enough. People will not be able to live on that in the year 2040 or whatever it is they retire.

Is it a tax? It is more money going from the taxpayers' pocket to a government they do not trust because for the last 25 years governments have spent far more money than they have brought in.

In 1996-97, not a Tory year but a Liberal year, Canadian individuals and companies will have paid $3.1 billion more in taxes than they would have paid had the Liberals left the tax system as is upon leaving office. Why the time, why the paper, why the energy, why the cost in Bill C-92? Why would we bother with it? Even if the Liberals had just left things alone and kept their mitts off it, the country would have been better off. It will go up to $3.1 billion more in taxes for Canadian individuals and companies. It is pretty scary.

The finance minister likes to quote from our taxpayers' budget and go back to 1993 dollars when we were referring to Econometric figures and role models and were making estimates on the dollars being spent in 1993 and 1994. He is always interested in comparing the dollars of yesteryear. Let us measure it in real 1996 dollars. The Liberals will collect $11.4 billion more in income taxes in 1998-99 than in 1993-94.

When the Tories came in and gave their great budget predictions for 1996 everything was to be absolutely terrific. However, if we look ahead to 1998-99 there will be $11.4 billion more in income taxes.

The finance minister has now delivered four budgets. I could have sworn when first elected he said there would be no new income taxes. He would have a hard time convincing Canadian citizens today sitting around their tables trying to fill out their tax returns that there have been no new income taxes. They would think his nose was growing.

What is the bottom line? It is that Canadians are shipping more of their hard earned money down to Revenue Canada. I do not think they are happy about it. Whether they support Liberals, Reformers or the Bloc, I do not think they are happy about it. They see less return for more money they are sending to the taxman. I guess that is what we have to look at.

I do not think Canadian citizens deny that they should pay taxes. If we want government services, if we want roads, airports and other infrastructure, obviously there will be tax revenues. I have never met anyone yet who is not upset about paying some form of taxes.

What bugs them, whether they are Liberal or Reform supporters, is that the people they send the taxes to are spending the money irresponsibly. They are just tossing it around. It is called deficit financing. They are spending tens of billions more every year than they are bringing in.

It becomes a trust factor with politicians. People ask why they should trust the government with the money they send and why they should send more when it does not spend what they have already sent in a responsible manner. That is the crux of this matter. If the government could be trusted more to do what it says it will do, people would not mind sending tax money. Taxpayers get pretty upset when the government spends more and more and more and they are given less and less and less in return. There is something wrong with that system.

(1325)

Heaven help the politicians who go out of here, probably next Sunday when the writ is dropped, and make foolish, unwise promises to get re-elected. If I can leave members in this place with some advice, it would be that when they go out on the campaign

9951

trail they should not to try to buy their way into office or make a promise they cannot keep. If they ask Canadians to vote for them and promise to give them more, they should remember that it is taxpayers' money.

I read an article today in a Saint John, New Brunswick, newspaper about a government program to give seed money for hotels and new armouries to be bought. We should not think for a minute that people believe it for a minute. It is taxpayers' money which they want the government to spend responsibly and not waste.

Mr. Jay Hill (Prince George-Peace River, Ref.): Madam Speaker, it is a pleasure for me this afternoon to join in the debate on third reading of Bill C-92, an act to amend the Income Tax Act, the income tax application rules and another act related to the Income Tax Act.

We cannot discuss the bill without talking about Canada's crippling public debt, which currently stands at over $600 billion and is still rising steadily. It is expected that our national debt will reach at least $619 billion by 1998. The Mulroney Tories added $300 billion in just nine years. People are well aware of the legacy of Brian Mulroney. Thanks to Liberal overspending, Canada's public debt has increased by a further $111 billion since they came to power in the fall of 1993. The interest payments on the national debt are expected to be a staggering $45 billion to $46 billion per year over the next three years.

Who pays for all this? There is only one Canadian taxpayer and that is who is paying. Of the $10,200 the average taxpayer sends to the federal government each year, about $3,400 of it will go to service the huge public debt.

Then we come to the deficit. It was projected at the time of the budget at $19 billion for this fiscal year. It is hardly a figure to brag about, but that is exactly what the Liberals have been doing. After learning about this figure Alberta provincial treasurer, Jim Dinning, said that if he were the one turning in that figure he would expect a kick in the butt. He would deserve it.

We know that the burden of deficit reduction has been shouldered by Canadian taxpayers as the Liberal government waits for tax revenues to catch up to its spending. There are rumours that the deficit could come in substantially lower. We are quite likely to see figures of $14 billion, $13 billion or perhaps down around $10 billion in deficit projections at some point during the election campaign.

British Columbians will be very suspicious of that type of rhetoric during an election campaign. They well remember Glen Clark of the NDP that is still in power in British Columbia and some of the projections about deficits, balanced budgets and that type of nonsense during the last provincial election. Regardless of the deficit number, the point has to made and Canadians have to understand that the hole is still getting deeper. We might be digging a little slower but it is still getting deeper every year and we are still passing on more and more debt to the next generation.

(1330)

How has the Liberal government made the gains it has in the battle with the deficit? A number of my colleagues referred to this during their presentations over the last hour. It is a fact there has been a $24 billion a year increase in taxation revenue.

It is a fact that as we go into an election campaign, whether it is this spring, next fall or next year, the Liberal government has to run on the record that it is collecting $24 billion more this year in taxation revenue from Canadians than it did in 1993 when it came to power.

It has to run on the record that it has cut roughly $7.5 billion from the Canada health and social transfer. It cannot deny, despite its red book claims of being the great defender of medicare, of being concerned about the next generation and education for our young people, that it is the one that has made that huge cut of $7.5 billion to the CHST.

The Liberals cannot deny that a week before this year's budget they slipped in a 73 per cent increase in the CPP premiums. The facts speak for themselves. They cannot deny that they have been very fortunate to have their administration operating at a time when our nation has enjoyed the lowest interest rates in four decades. That is the real reason that some gains have been made on the deficit.

What have we seen in the area of spending? We have seen a total lack of priorities. From the time the Reform movement was born in 1987, we recognized that the way to get government spending under control was to reduce the size of government by prioritizing spending on the things Canadians desire most. The simple fact is that we cannot continue to do business as usual. That is what the Liberals are attempting to do. They have made some cuts but in reality they still cling desperately to this old philosophy of big government, of we know what is best for all people.

The arrogance of past prime ministers was very clear during Brian Mulroney's presentation to the Canadian Club in Toronto the other day. We are seeing that same type of we know what is best from the Liberal government across the way.

Nothing provides a more apt example of why we find ourselves in the position of needing to borrow $10.8 billion this year than Canada's regional development agencies. They provide a perfect example of the Liberal philosophy: throw money at it and the problem will go away. Through agencies such as the Atlantic Canada Opportunities Agency, Western Economic Diversification and the Federal Office of Regional Development for Quebec, this government is subsidizing private businesses and adding to our

9952

staggering national debt which will be paid off by the long suffering Canadian taxpayers and by future taxpayers.

By doing so the government is interfering with natural market forces. It is using low interest, no interest or in some cases what the Liberals would like to call non-repayable loans-whatever they are-to give some businesses an edge over their competitors that are not fortunate enough to be chosen as the objects of the Liberal government's pork-barrelling patronage.

In November 1996 the Atlantic Institute for Market Studies conducted a study which was aptly titled ``Looking the Gift Horse in the Mouth: The impact of federal transfers on Atlantic Canada''. The authors of that study found that if the federal government had invested all regional subsidies to Atlantic Canada in three month United States treasury bills it would have built up a nest egg of about $700 billion U.S. since 1971. That is about $1 trillion Canadian if the federal government had invested that money.

(1335)

To put this into perspective, that is almost twice the size of our national debt. The House will remember what I said earlier about priority spending. It would translate into a surplus over the debt, no more punishing debt service charges and ultimately into much reduced taxes for Canadians.

In his 1995 budget the finance minister promised to undertake what he called a program review. Part of the program review involved a commitment to refocus the regional development agencies and to decrease spending in this area by 50 per cent, from $1.1 billion in 1994-95 to $576 million in 1997-98. What do we see now? We see a very different picture from what was promised by the government in 1995.

When we look very closely we see that regional development agencies will actually have total expenditures of $1.2 billion in 1997-98. However, we do not see the increases in the budget numbers. The increases have been hidden, as have other spending increases. For example, the 1997 budget did not even provide a breakdown of what the regional development agencies will spend in the upcoming fiscal year, even though such breakdowns have usually been provided in past budgets. If a breakdown of spending had been provided, what taxpayers would see is not the 50 per cent decrease that the finance minister promised in 1995, but an increase.

Instead, when funding to extend the infrastructure works program is included, what we really see is a 7 per cent increase in total expenditures for regional development agencies from the last fiscal year. Funding for infrastructure is included in this calculation because the Liberal government originally intended it to be included.

In their 1995 budget projections for regional development spending the government noted that the figures were to include infrastructure expenditures. This makes sense, considering that infrastructure programs are a form of regional economic development based on a formula that includes regional unemployment levels.

However, what we see now is the Liberal government trying to exclude money for infrastructure works from the regional development figures in an attempt to make it seem as though spending in this area has actually decreased. It is smoke and mirrors. This is creative accounting at its worst.

When funding to extend the infrastructure works program is included, what we see is this:

First, Atlantic Canada Opportunities Agency spending will increase 2 per cent from the last fiscal year to this year, to $347 million in 1997-98. Spending by the Federal Office of Regional Development for Quebec will increase by 11 per cent, to $408 million. Spending for the western economic diversification program will increase by 10 per cent, to $380 million.

Where is the money for regional economic development agencies going? A look at the public accounts for 1995-96, released in October 1996, gives us some telling examples.

For example, in that year $211,500 from the Atlantic Canada Opportunities Agency went to the Society for Canoe Championships in Dartmouth, Nova Scotia, and $310,071 from the western economic diversification program went to the Abbotsford air show. Those are probably worthwhile organizations, but is it right to invest taxpayers' money in such a way?

In January 1997 an interest free loan of $723,000 was granted by the western economic diversification program to Alberta potters, jewellers, weavers and other craft artists belonging to the Alberta Craft Council for Business, Training, Marketing and Network Development.

When we look at the 1997-98 estimates respecting spending by the Federal Office of Regional Development for Quebec, we see that from last year to this year total grants under this program, or as the Liberals have been fond of calling them, non-repayable loans, have increased from $300,000 to $1,055,975. Why? Because once again the Liberal government has chosen to subsidize small business rather than introduce meaningful tax cuts which would encourage economic growth and assist all small business.

(1340)

The increase is attributable to grants made under IDEA, the innovation development entrepreneurship and access program for small and medium sized businesses.

9953

In the limited time remaining, I will sum up by saying that over the last 3.5 years we have seen a lack of commitment to spending priorities. Reformers suspected before we became members of Parliament and it has been borne out over the last 3.5 years that the government is committed to the philosophy of big government, big spending, big taxes. The cuts it brags about and which it is taking into the election campaign are in reality just smoke and mirrors. It has not happened.

Mr. Johnston: It is Liberal math.

Mr. Hill (Prince George-Peace River): That is quite correct. Coming to light are the canoe museums, armouries and hotels being built in Shawinigan. It reminds me of a comment our deputy leader made to me earlier today about the movie Sleepless in Seattle. It was a huge hit. The spending in Shawinigan reminds us that the Liberal sequel may be Shameless in Shawinigan.

Mr. Johnston: Coming to a theatre near you.

Mr. Hill (Prince George-Peace River): Perhaps not to a theatre. Coming to a voting booth near you.

I am sure that when Canadians take the time to look at the record of the Liberal government which added over $100 billion to the debt in 3.5 years, drove the country deeper and deeper into debt, burdening the already over-burdened citizens and taxpayers of the future, and when they go to the voting booths and think of this Liberal sequel, Shameless in Shawinigan, they will be turfed out. Canadians understand it is Liberal, Tory, same old story. The Liberals believe in big government, big spending, big taxes. It has been tried for over 130 years and it is time for a fresh start with Reform.

Hon. John Manley (Minister of Industry, Minister for the Atlantic Canada Opportunities Agency, Minister of Western Economic Diversification and Minister responsible for the Federal Office of Regional Development-Quebec, Lib.): Madam Speaker, it very interesting to hear the hon. member and his description of various aspects of work that we have been undertaking over the last several years which have been directed toward the creation of opportunities for jobs and growth in the Canadian economy.

It has been very interesting to begin to speculate, based on what we heard him say, what exactly the Reform Party platform might mean for jobs and growth in the Canadian economy. I have managed to deduce a few things from his comments.

The first would be this. Despite all of the efforts that governments around the world put into building a vibrant tourism industry in their countries, and despite the fact that the tourism sector is projected to be one of the largest growing economic and employment sectors in the world over the next 20 years as increasing numbers of the world's population become economically capable of engaging in tourism and travel strictly for pleasure, the Reform Party does not believe that the Government of Canada should direct its efforts toward improving the tourism product or attracting tourism to Canada. Many of the things he has criticized are ones that go directly to support the travel and tourism business.

(1345)

Let me pick one example, the Abbotsford air show. He puts that down and he picks on that one. Out in the heartland of British Columbia, it is now the premier air show in North America. It is the point to which all of the major aircraft suppliers and manufacturers come, Abbotsford, British Columbia. It is an important contributor to the economic development of that region. It is a destination creator for Abbotsford as well as being important to the western Canada aerospace sector, and he would cut it out.

There is no air show in the world, whether in Paris or the UK, that continues to attract the level of participation necessary to have a major air show without government support, and the Reform Party would end that.

He talked of western economic diversification and its role. He has a little trouble with the numbers because he cannot quite figure out how the infrastructure funds fit into the estimates. He is a little out of date. He thinks they are still providing direct assistance to individual enterprises. He is wrong. Listening to the last two speakers from the Reform Party I am reminded of some of my other duties with respect to technology. I think we need a new V-chip for the parliamentary channel that can bleep out some of the misleading things that occasionally come out of the mouths over there.

Let me talk about western economic diversification. Not in years have they been giving direct assistance to individual enterprises. What would they shutdown when they close western economic diversification across western Canada? They would close down 91 points of service for small businesses throughout that region. They would close down all the community future development corporations, those little organizations grounded in western Canada where they develop the priorities for the economy of their region, where they sort out what their potential is and how they can build jobs and growth.

That is not some kind of political slush fund. It is the lawyers, the accountants and the small business people of communities across western Canada who participate as volunteers in finding the keys to economic growth and diversification in their communities. That is what western economic diversification is supporting.

It is women's enterprise centres, the sources of information for women to find out how they can start businesses, how they can build careers that not only help themselves but provide opportunities for others to work. That is what they would shut down. That is what western economic diversification is now doing. Their criticism is directed at the dinosaurs that are gone, and not inappropriately.

9954

We hear from Reformers repeatedly that in order to create jobs they would slash the government and they would cut taxes. Then they make a list. They say the Minister of Finance has raised taxes and I think they recite a number. They include of course the number of tax increases they blame the Minister of Finance for, increase in taxes on the banks. They blame him for shutting down loopholes. They count those as tax increases.

The Minister of Finance has targeted tax reductions, over $2 billion in the last year in areas where it makes the most difference. We help the people who need the help most. They would substitute across the board tax cuts in order to benefit whom? The highest paid, the best income people in the country. That is the Reform Party platform. Is that going to create jobs? It may well do that because some of those high income people are going to have more spend on their vacations outside Canada.

Miss Grey: There are suntans over there.

Mr. Manley: There is someone speaking who does not like to listen. She does not listen very often, I have noticed, around here.

What we see repeatedly from Reformers is nothing but a bunch of economic bunk. There is no economic analysis or study that they can provide to anybody that would show that across the board tax cuts can provide direct economic benefits and job creation in this country.

In fact, they are like the kids before Christmas who want to open their presents on December 20. They are not even ready to get the deficit down to zero before they start to open the presents and cut the taxes. That is the kind of economic analysis and argumentation they put forward-

(1350)

Mr. Hill (Prince George-Peace River): Madam Speaker, on a point of order, perhaps you could enlighten the House. Is this a 20 minute rambling speech or is this questions and comments?

The Acting Speaker (Mrs. Ringuette-Maltais): This is questions and comments for 10 minutes. There are 3 minutes and 12 seconds left.

Mr. Manley: Madam Speaker, I did not see any point in putting a question because I did not think the hon. member would have an answer. However, I do see the point in making comments.

We have listened to speaker after speaker from the Reform Party spouting this kind of economic nonsense. I have had a great privilege as a minister of the crown over the last 3.5 years to travel the world and hear from others exactly what it happening and how Canada is viewed.

When we had to present the budgets in 1994 and 1995 and take ourselves to the financial capitals of the world, it was impossible at that point to be accepted as credibly managing the finances of our country because of the years of the Mulroney government when the Government of Canada had failed to meet its deficit reduction targets.

We have achieved in exceeding the targets year after year, in bringing the deficit from the sixth worst in the G7 to the best in the G7, in setting the course toward reducing our overall indebtedness as a nation, in reducing a $30 billion a year current account deficit to a surplus last year, in reducing the tourism account deficit from $6 billion to $2 billion. We have rebuilt this country's credibility. It is on that basis that we will rebuild the jobs and economic growth that this country so deeply wants.

Mr. Hill (Prince George-Peace River, Ref.): Madam Speaker, how much time do I have?

The Acting Speaker (Mrs. Ringuette-Maltais): One minute.

Mr. Hill (Prince George-Peace River): This is fair debate?

I have never heard such a bunch of nonsense in my whole life as what has just been spouted by the hon. minister from across the way. He referred to western economic diversification and then attacked the Reform Party, saying that we would cut out all these great and wonderful things. How many people out there know that the western economic diversification program is subsidizing banks?

He says we would shut down the Abbotsford air show. How many people in Abbotsford would vote to subsidize an air show versus $7 million cuts in health care? What we are talking about is priority spending, something this government does not understand.

As far as blipping out stuff on the parliamentary channel, if we had to blip out misinformation there would not be a thing said from the other side of the House.

[Translation]

The Acting Speaker (Mrs. Ringuette-Maltais): Is the House ready for the question?

Some hon. members: Question.

The Acting Speaker (Mrs. Ringuette-Maltais): Is it the pleasure of the House to adopt the motion?

Some hon. members: Agreed.

Some hon. members: No.

The Acting Speaker (Mrs. Ringuette-Maltais): All those in favour of the motion will please say yea.

Some hon. members: Yea.

The Acting Speaker (Mrs. Ringuette-Maltais): All those opposed will please say nay.

Some hon. members: Nay.

9955

The Acting Speaker (Mrs. Ringuette-Maltais): In my opinion the yeas have it.

And more than five members having risen:

The Acting Speaker (Mrs. Ringuette-Maltais): Pursuant to Standing Order 45, the recorded division on the motion stands deferred until Monday, April 21, 1997, at the usual time of adjournment.

* * *

[English]

CRIMINAL CODE

The House resumed from April 17 consideration of the motion that Bill C-95, an act to amend the Criminal Code (criminal organizations) and to amend other acts in consequence, be read the second time and referred to committee of the whole.

(1355 )

Mr. Jim Silye (Calgary Centre, Ref.): Madam Speaker, I wish we could stay on Bill C-92, after the diatribe by the cabinet minister, especially in pointing out that we would be making tax cuts before the budget is balanced. That is a false representation of our platform. We would not cut taxes until the budget was balanced. We could get there sooner and we would put more money back in the hands of taxpayers than this government will ever dream about doing.

Let us get to the matter at hand, Bill C-95. Bill C-95 is anti-gang legislation that has some serious issues tied and related to it.

This all started as an incident, as we all know, in Quebec City. There is a lot of violent crime being committed by some gangs there, basically threatening innocent bystanders on the streets. It is important to address this situation.

However, the federal government is reacting to a challenge by the Bloc Quebecois that says the government is doing little to protect Quebecers. The Minister of Industry states how wonderfully the government is investing and how great everything is financially in the province of Quebec. I assume he also includes it with the regional development grants and how all the wonderful laws that the government is passing is benefiting Quebecers so that they understand and realize that this is a great country to live in and they should stay in Confederation. Notwithstanding all that, the representatives who were sent here by the majority of Quebecers, the Bloc Quebecois, stand up in this House and say this government is doing little to protect Quebecers. They have said other things in other areas.

Perhaps the federal government should pay more attention to what the demands and needs are of various provinces all across the country.

Perception is everything in politics. The Prime Minister said that. As I said earlier today, it is unfortunate that reality is not everything and is what the government is basing its decisions on and is what it is working toward; the reality, the real truths, not everybody's distorted opinion of the truths.

What is wrong here is now that there is an election being called this justice minister has rushed to the fore where a month ago he was not interested in this issue. When the plea came from the Parti Quebecois to do something about introducing stronger federal legislation to handle these criminal organizations or a criminal gang, he was not interested. He did not want to go too fast.

I do not know when somebody whispered in his ear that there might be a potential election call, so gear for it, get ready for it. Most of the decisions that we have seen in the last couple of weeks and the behaviour of this federal government seem to be that it is preparing for an election and it is trying to make itself look good. There are quick settlements on a lot of issues that have been outstanding and dragging out over the last two or three years. They are getting resolved in the last two or three weeks, in the last two or three days and even the House leaders have been working together to co-operate and get everything done together. This is all because of an election.

If this issue was not important to the justice minister two years ago when it first arose, if this issue was not that important to him a month ago, why is it that important now and that we only have three days to debate this?

I know why it is important but why create the urgency that it must be passed within three days? Why can it not wait? Why can the government not wait for an election and call an election for real reasons? It has no reason to call an election.

There are important and pressing issues in the economy, in society that the government could still be addressing. On the wonderful job and the great honour and privilege that the Minister of Industry claims to have had by serving, why does he not serve for another year and finish it? If he does a good job for another year he will get elected again. What is he worried about?

No, perception is everything so it has to give the perception to the Bloc Quebecois that the government is looking after the interests of Quebecers and the Quebec society, that the federal government is co-operating and the Reform Party is co-operating as well. We are helping this legislation go forward. We do not want to be restrictive. We do not want to expand debate. We want to get to it.

I submit that this is an example of poor governance. If it is politically motivated, it is poor. I accuse the Liberal Party, the Bloc Quebecois and the Reform Party of the same accusation. Our job here is to present proper and good legislation. What is the point in passing bad legislation? It will just get thrown out in the courts

9956

anyway, especially amendments to the Criminal Code. We would be better to have no law at all than to have a bad law.

(1400)

I certainly support the general intent and the problem the bill is trying to resolve. However the bill has raised so many red flags in my mind that I feel we should take a little more time to discuss it, even if it is a couple of days. There are many important issues here. Over the past two years we debated many criminal amendments for months, and suddenly this one goes through in three days.

We have been pressing and trying to represent victims and victims rights with victim impact statements. A member of our caucus, the member for Fraser Valley West, presented a victims bill of rights. It had a lot of good clauses. It was every bit as good as the legislation in Bill C-95. We asked the finance minister to fast track it. We did not say three days. We asked him many months ago to put it on the agenda so we could get through it. A year ago it was sent to committee. Since then nothing has come back and nothing has been done. Why? It was because the polls did not tell the government to react.

The Liberals are doing poorly in Quebec. An election is coming a week from now. The government has to act, react and show that it cares. In the process it might be passing bad legislation, not might. I have examples of areas of concern where we need constitutional experts and arm's length lawyers to give opinions because they intervene and conflict with the charter of rights and freedoms.

This is a serious issue. Never before has a justice minister or a government tried to pass laws that talk about a group and what criminal organizations are. There is freedom of association in the country. The Quebec provincial government wanted a law to make it a crime to belong to a criminal organization. How do we know it is criminal? We have to define criminal organization.

It is dangerous to give powers to the police if it is done quickly without being thought through. The police needs the tools to do its job, but if they are given with the intent solving one problem are we perhaps creating other problems? What about this extra surveillance with electronic devices to listen in on telephone calls? What about requisitioning and procuring income tax returns of people suspected of associating with criminal organizations? What if these powers are used for other groups? It could entrench on civil liberties and has to be discussed.

It is being done for the wrong reason. It is being fast tracked for the wrong reason. To bring the bill forward, to debate the bill, to solve the problem is honourable, good and should be done. However the Liberals are responding and reacting to one provincial government that has threatened to pull out of the country. They are reacting faster to that government than to anything that any other opposition party, from the NDP to the Reform to the Conservative, raise in the House to satisfy British Columbia, Alberta, Manitoba, Saskatchewan, Ontario and the maritime provinces.

We have to be very careful when we talk about giving powers to the police. It is just like the gun control bill, the firearms legislation. I gave a talk on it when the justice minister was in the House. He was trying to force, ram and push that legislation through. It got through the justice department which put it together. It got by the justice minister who was involved.

Guess what was in that clause? If they suspected somebody of hiding firearms, shotguns, rifles or handguns, police forces had the right to search and seize the weapons without a warrant. That was the original clause in bill when it came to the House. It was just like the bill today with clauses of a similar nature. The justice minister said that it should be fixed, that we were right, and that we could not let police forces search ad hoc anybody they feel like searching. He agreed that we should insist upon a warrant on certain grounds.

(1405)

I am talking about rushing bills through and ending up with bad legislation. That is poor governance. I certainly recommend we should not be a part of that. We should take the time needed to get it right.

In terms of victims rights the justice minister said in the House that we had to take our time and get the bill right. He said it involved many issues such as provincial jurisdiction and the charter of rights. He was in favour of it but said we had to take our time. Now we have anti-gang legislation being rammed through.

I refer to a Globe and Mail article by Rhéal Séguin which read in part:

``We've defined criminal organization and then we said it is not a crime to be a member of it.

``But if you do anything that is a crime and that is for their [the criminal organization's] benefit, under their direction or in association with them, then you've put yourself in a position where you've created a very serious offence, '' Mr. Rock told a news conference.

Let us think this through for a second. There is a contradiction.

Mr. Hill (Prince George-Peace River): No one can figure it out but a lawyer.

Mr. Silye: Even some lawyers would have a hard time defining criminal organization and making it illegal for a person to be a member of such a group if he or she commits a crime for the benefit of the group. How does it become a criminal organization if it has never committed a crime? If a crime has been committed, why is the person not put away to do the time for that crime? How can an organization be called criminal? If it is not illegal to belong to a criminal organization but it is illegal to commit a crime within

9957

it, the group is already identified as a group intent on committing criminal activity. That should not exist.

Under the definition of criminal organization the crown must prove that five or more members in the group act as an association or a body together and that one member of the group, or each collectively, commits an indictable offence with the maximum penalty of five years or more. That is one of its primary objectives.

How is the primary activity proved unless a conviction has been registered for an indictable offence punishable by a maximum penalty of five years or more? In other words the person should have been caught and put away even before the group existed. Five or more persons is defined as a group. Are four people not a group? If four people intent on criminal activity form a group, will this definition not apply? Does it have to be five or more?

The bill talks about explosive substances and owning offence related property. Officers are allowed to confiscate dynamite, bombs and things like that. However the definition of explosive substance is not in the bill. If it is not defined, should it not be defined? We know the obvious, but what about what is not obvious?

I will turn to another item in the bill. How does the bill coincide with young groups? There is no reference to age. There is no mention of the Young Offenders Act. We are talking about a certain group. We know who they are. We see them. We see pictures of them.

There have to be five or more. It cannot be four or less but it does not talk about young groups. How does the bill relate to the Young Offenders Act? Does it conflict? Does it have an impact on it? That is not covered. Should it not be covered?

The next item in the bill talks about everyone who participates in or substantially contributes to the activities of a criminal organization knowing that any or all of the members of the organization engage in or have, within the preceding five years, engaged in the commission of a series of indictable offences under this or any other act of Parliament for each of which the maximum punishment is imprisonment for five years or more. How do we prove ``participates in''? What does ``substantially contributes'' mean? ``Aiding and abetting'', but to what degree? What does it really mean? What is the level of a substantial contribution? If somebody gives $25 to a political party, if somebody else gives $500 and if somebody else gives the maximum $1,000 for which they receive a tax receipt for $550, which one is substantial? Is a $100 donation substantial or is it closer to $1,000? It is the same thing here. What is a substantial contribution to an organization? If I give $500 I am okay, but if I give $1,000 that is a substantial contribution?

(1410)

These are some of the problems which deserve a little more attention. If we as politicians were to do our job properly, we would ensure that civil liberty groups would have the chance to understand why there is a need and how these things are to be done. Those questions should be answered.

If we ask these questions when we get to committee of the whole on Monday of next week, the justice minister should have the answers. I do not see how it will be possible for him to have the answers because they are not in the bill. Those answers are left to interpretation.

Another pressure point comes from the media. The politicians are trying to further their party and show they care by passing legislation. I do not want to belong to the party that holds it up. I do not want to be a Bloc Quebecois, a Reformer or a Liberal who holds up the legislation because if somebody gets killed tomorrow or next week it will be our fault. That is crap. It will not be the fault of anyone in this room; it will be the fault of the person who committed the crime.

We must pass good legislation to address this problem. If a crime is committed next week and the individual goes to court, and because of poor wording and a lack of clarity the criminal gets off on a technicality, because a supreme court justice whose job it is to protect individual rights decides that this criminal should get off, but we know he did it, then who is to blame? It will be the fault of the Liberals, the Bloc and Reform. It will be our fault.

That is what is wrong with this bill. That is why it is important for us to have the sensibility and the common sense not to rush things through for partisan purposes.

We have been a party to certain bills which have gone through quickly, but they were done properly because the language was clear. We are talking about amendments to the Criminal Code which will impact the charter of rights and freedoms. The justice minister could have added a chapter to those rights and freedoms over the past three years called responsibility. If someone is a member of a gang they have certain rights and freedoms, freedom of association, freedom of speech, freedom of assembly, freedom to drive up and down the streets with 100 bikes roaring in their ears. It is the responsibility of the person to keep those freedoms by not committing a crime. If they do they will lose their rights, freedoms and individual liberties.

If we debated this properly, took an extra five days and sent it to committee for a decent period of time, some better suggestions might come forward.

It is more important to get it right than to get it done quickly. We can get it right and done quickly if we all get together and put our heads to it, rather than the leader of the Bloc Quebecois trying to make political brownie points in Quebec, rather than the justice minister trying to show how co-operative he is in times of urgency and emergency. Victims rights are just as important as this. He is setting a bad precedent, proving he is doing it for political reasons and that the Reform Party is afraid to speak its mind because it does not want to be seen as a deterrent to progress of the justice system. We are not.

9958

(1415)

All three parties should put away their political partisanship on the issue, get their heads together on Monday in committee of the whole and come up with legislation that will be right, with proper explanations and definitions, clarity and a sense of confidence that when it is challenged in the courts it will not make the politicians of this session of Parliament look like fools.

Mr. Jay Hill (Prince George-Peace River, Ref.): Madam Speaker, it is interesting that this bill has come forward very quickly. Considerable attention has been paid to this issue in Quebec. Canadians are concerned about the increase in crime, especially violent crime in some cities in Quebec, directly attributable to the actions of gangs, the drug trade, the illegal trafficking in guns, gambling and prostitution, in short, organized crime activities, not only in Quebec but across the nation.

Canadians who are watching the debate today in its abbreviated form are perhaps scratching their heads wondering about the use of section 745. I heard a comment recently about Clifford Olson being the multiple murderer who is hiding behind a rock.

There was a hue and cry across the nation from victims, victims groups and the general public. Organizations like the Canadian Police Association had passed a resolution asking for the repeal of section 745. There seemed to be a genuine consensus that something should be done to prevent this individual who has admitted to the horrible torture, rape and murder of 11 children, from using that section, the so-called faint hope clause and getting another day in court to make his points and revictimize the families of these young children.

I am sure Canadians are wondering how the government can move in such a speedy fashion on a bill such as C-95 and yet pay virtually no attention to section 745 and the cries of victims and victims groups to repeal that section.

In February the judge had no option but to grant Clifford Olson his day in court. He will be flown from Saskatoon to Vancouver on August 18 and the whole country will once again be treated to the spectacle of this predator, this disgusting degenerate, having another day in court.

I wonder if my colleague would like to comment on what I see as a terrible travesty of justice, that something like this could be allowed to happen and it has received virtually no attention.

(1420 )

The government brought in some minor amendments and tried to sell them to the Canadian people by saying that it did not really believe that it should repeal section 745 because there are some people who perhaps deserve early parole. They did not want to cut that off. What we were saying is that 25 years is not too much for the Canadian public to expect first degree murderers to serve.

Polls taken across the country consistently show that about 65 per cent to 70 per cent of Canadians support the return of capital punishment for people like Olson and Bernardo.

Previous governments have been able to sell abolishing capital punishment for these types of animals by telling Canadians that they would serve 25 years. I cannot help but wonder what will happen to someone like Clifford Olson who I am sure the majority of Canadians believe cannot and will not ever be rehabilitated. What happens when his 25 years are up?

We all hope and pray that he will never be eligible for early parole, despite the government allowing him to have the luxury of going through this farce of a section 745 hearing. However, what happens after 25 years? We are not talking here about parole. He will have served his sentence and theoretically he is going to get out because this government has not addressed that type of concern.

Something has to be done to keep these predators locked up forever. They cannot be allowed back into society to select more victims. It cannot happen. We have to find a way to prevent that from happening.

I wonder if my hon. colleague would comment on what I see as a clear contradiction on the part of this government.

Mr. Manley: Explain what 25 years is without parole.

Mr. Hill (Prince George-Peace River): Would the hon. Minister of Industry just kindly hold his comments? He had ample time a little while ago to spout all sorts of nonsense for as long as he wanted. Now he is trying to do it again.

I wonder if he would comment on the contradiction between a government that holds itself up as being concerned about victims, concerned about gang violence, concerned about all these things and is rushing this bill through, when in reality that is the furthest thing from the truth. The government is not concerned about victims. That is clearly shown in the legislation it has introduced and passed. That legislation has done little or nothing to benefit the victims of crime and lots to benefit the criminals themselves.

Mr. Silye: Madam Speaker, I am just guessing, but I assume I have about two minutes left.

I am glad I was able to settle the dispute between the Minister of Industry and my colleague. Now they have each had an intervention of eight minutes.

My colleague makes a very good point. What criteria does the justice minister use to decide what is a priority if addressing section 745 is not a priority? He claims he has. He claims he has fixed it for multiple murderers. If people commit one premeditated murder they will still have a chance to get out after 15 years even after being sentenced for life with no parole for 25 years. The murderer will still receive this early review after 15 years. That is not truth in sentencing. That could have been addressed. It would have been an easy bill to pass very quickly. It would have had clarity and would have passed the test of the Supreme Court.

9959

(1425)

My colleague is right. We have to be consistent in the application of the criteria. I am embarrassed to admit it but I believe the justice minister is rushing this bill through more for political reasons than for showing that he cares about the violence in Quebec City. He did not care about that a month ago.

Mr. Dale Johnston (Wetaskiwin, Ref.): Madam Speaker, we are having a difficult time convincing Canadians that there is justice in the justice system. That perception among Canadians is becoming more and more prevalent all the time.

I could not help wondering, as I was listening to my colleague speak, why are we acting in such haste with this bill? I have listened to the justice minister on various occasions say that tough cases make bad laws. As a matter of fact, he used that argument when the Reform Party and others were pressing his department to make changes to section 745. How is this situation any different than that?

Certainly all Canadians agree that organized crime should have very severe restrictions placed on it. We all agree that what has been happening in the gang wars in Montreal is an absolute travesty. Innocent people are being killed. It is a form of terrorism. When a gang war is going on in your community it is a form of urban terrorism. Canadians are well within their rights to be repulsed by this kind of activity and it behooves this place to do something about it.

This situation did not emerge in the last few weeks so therefore we must act immediately. It makes me wonder whether we are going to enact this legislation or whether it has simply been placed on the table. I know we are not supposed to impugn motives but I wonder if this legislation has not been tabled more for optics and political reasons than for justice reasons.

The Minister of Justice has not found it within his realm to act expediently on other sections, for instance, to pass retroactive legislation that would stop multiple killers like Bernardo and Olson to apply for early release. The legislation is not retroactive. People who are now serving life sentences will be able to apply for parole after serving two-thirds of their sentence.

It puzzles me how the minister can on the one hand say that we must act with caution and due diligence and take deliberate slow steps and on the other hand say that this problem is taking place in Quebec and must be dealt with immediately. He knows it is potentially fertile ground for his party. He knows that it has always been a key to Confederation. It has always been a key to whether or not a party holds a majority and therefore that should be reason enough to act immediately.

I think the people in British Columbia are going to remember long and hard the fact that Clifford Olson has been treated with some celebrity status and is certainly getting the notoriety that he so hungrily seeks. I believe the electorate in British Columbia are going to remember these instances. I would even go so far as to say that if they are having a little bit of a problem remembering it, there will be certain political parties that will do their utmost to make them remember.

[Translation]

The Acting Speaker (Mrs. Ringuette-Maltais): Being2.30 p.m., the House stands adjourned until Monday next at11 a.m., pursuant to Standing Order 24(1).

(The House adjourned at 2.29 p.m.)

House Publications

CONTENTS

HOUSE OF COMMONS

_______________

Prayers

_______________

* * *

_____________________________________________

GOVERNMENT ORDERS

_____________________________________________

STATEMENTS BY MEMBERS

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

_____________________________________________

ORAL QUESTION PERIOD

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

* * *

_____________________________________________

ROUTINE PROCEEDINGS