1985-05-24

STATEMENTS PURSUANT TO S.O. 21


Mr. Alfonso Gagliano (Saint-Leonard-Anjou):: Mr. Speaker, yesterday afternoon, Canadians had their hour of truth.
The Minister of Finance (Mr. Wilson) brought down a budget for the rich and for the multinationals. The rich received a present of $125,000 cash in the form of a capital gains exemption, and if their accountants have any imagination, they will not pay a cent of surtax for 1985-86.
A few months ago, the Conservative Government proposed to do away with the off-oil subsidy for switching from oil to other forms of energy such as gas or electricity.
Government Members told us that these drastic cutbacks, which affected the average Canadian, were necessary to reduce the deficit. A few weeks later, they signed an agreement with the multinational oil companies, giving away $2 billion in the process.
Yesterday afternoon, the Minister of Finance confirmed what we said when the agreement was signed: that Canadians would pay for this. The 2 cents per litre increase in the price of gas, which will probably cost the Canadian consumer about 4 cents a litre, is a measure that is anti-Canadian and pro-multinationals.
The Conservatives showed their true colours yesterday afternoon, and this Government ought to be ashamed of the way it is selling Canadians out to the multinationals.


FEDERAL-PROVINCIAL FISCAL ARRANGEMENTS PROPOSED CUTS IN EQUALIZATION PAYMENTS
Mr. Rod Murphy (Churchill):: Mr. Speaker, last night's Budget continued the previous Liberal Government's attack on transfer payments provided to the provinces. It is ironic that the House, which is presently debating legislation reinstating
some of the money to our have-not provinces, including Quebec, Manitoba, Prince Edward Island, and Nova Scotia, lost as a result of Liberal Government cut-backs, now learns that the Conservatives intend to cut further transfer payments due under the existing formula by $2 billion.
That money is earmarked for post-secondary education and medicare in all provinces, and for equalization payments in our less rich areas. Equalization payments are guaranteed in our Constitution in recognition of the importance of maintaining a certain level of essential services to all Canadians regardless of where they live in Canada.
To attack these payments, in addition to funds for health care and post-secondary education, proves that the Government cares little for the plight of ordinary Canadians. The Government claims that it is a tough but fair Budget. It is tough to those who need assistance, and very fair, indeed generous, to those who need to be taxed more in order to pay their share of the legitimate costs of government.


THE BUDGET
Mr. Gerald Comeau (South West Nova):: Mr. Speaker, the Minister of Finance (Mr. Wilson) has not been the only one who has undertaken an extensive pre-budget consultation process. Like all government Members, I have been involved in an extensive program of consultation with many business, social, and other groups in my riding. I try to meet with as many of my constituents as possible at every opportunity. I can say that during the last few months I have met with a very large number of constituents, and I would like to share with the House the results of my comprehensive consultation process.
In my riding I found overwhelming support for fiscal responsibility and a realistic Budget or, as the Minister of Finance and the rest of my constituents have called it, a tough Budget. However, there was an equally strong feeling that the Budget must also be fair-fair and equitable. They told me that we, as a Government, could not and should not lose sight of those people who truly required our assistance. I think all will agree that we did not lose sight of them. We have asked all Canadians to share the responsibility for the deficit, and we have also asked those who can, to assist us in dealing with it. I am confident that it is the sense of equity and fairness which will ensure that this tough Budget receives the overwhelming support of all Canadians.
5026

May 24, 1985



Mrs. Suzanne Duplessis (Louis-Hebert):: 

Mr. Jean-Claude Malepart (Montreal-Sainte-Marie):: At
4.30 p.m. yesterday, Mr. Speaker, the people of Canada heard about the full extent of the intentions of this Government and the Prime Minister. The whole country has been under dark clouds since 4.30 yesterday afternoon.
Mr. Speaker, the Government has struck a low blow to the 2.5 million elderly Canadians who will have to cope with a $100 income drop next year. What is more, the Government will also take $100 a year from needy senior citizens.
And as I suggested in a question to the Minister of Finance (Mr. Wilson), who sees eye to eye with financiers, his Budget does not affect the 6,000 people with higher incomes ranging from $50,000 to $99,000, so they will still not pay any income tax.
Mr. Speaker, the people of Canada know now what the Government and the Prime Minister have in mind, and I sincerely hope they will defeat this Government in four years from now.


AGRICULTURE
Mr. Stan J. Hovdebo (Prince Albert):: Mr. Speaker, the only farmers to receive relief in yesterday's Budget were those who have given up and are quitting. Otherwise, agriculture, an industry in crisis, was singled out for particularly severe impact. Consultation with farmers failed. Fifty million dollars per year in grants and contributions are being removed. The cost recovery program of $33 million is still in place, and is being added to by a cost recovery program for the Grain Commission. Cuts in transportation subsidies are being increased. There is no mortgage relief, no agri-bonds, no Section 31 relief for part-time farmers. Research is a low priority. Crop insurance assistance is being cut back. There is an increase of two cents per litre in energy cost which is not rebatable. There is a general increase of 1 per cent in excise tax on all farm inputs.
Rural Canada, which sent many Members to form the Conservative majority, has been betrayed again. Farmers out there planting today know that they are being squeezed once more by the Government.


RESEARCH AND DEVELOPMENT
Mr. Ken James (Sarnia-Lambton):: Mr. Speaker, while I am sure that Members would claim that their ridings are ideal spots for the establishment of research and development companies, I can say without any hesitation that I believe the riding of Sarnia-Lambton to be ideally suited to take advantage of the Budget's generous R and D provisions.
The Budget's refund of 100 per cent of the tax credit on the first $2 million of qualifying R and D will undoubtedly bring about the establishment of many new R and D firms and the increased R and D commitment of many other firms throughout Canada and, in particular, in my riding, which already has a significant R and D base.
This important provision will serve a twofold purpose. First, it will result in the creation of a number of small R and D businesses and, second, it will bring about an increased Canadian participation in the international high technology field. This relatively simple provision will create jobs, utilize Canada's abundant brainpower, and expand Canada's role in the high-tech field.
May 24, 1985


EMPLOYMENT
Mr. Alan Redway (York East):: Mr. Speaker, the main concern of Canadians is jobs, and yesterday the Minister of Finance (Mr. Wilson) stated that the Budget's priority goal is jobs for Canadians.
In order to stimulate the investment needed to create those jobs, the Budget proposes a lifetime capital gains tax exemption of half a million dollars for every Canadian, measures to encourage greater investment in small business by pension funds, and a 100 per cent annual tax credit refund for qualifying research and development on the first $2 million of expenditures.
These measures, together with the Western Energy Accord, are aimed at promoting economic growth and creating jobs in the three areas of the economy most likely to result in the greatest and fastest response, small business, research and development, and the petroleum industry. The capital gains exemption, for example, should give small business a boost to expand. There are over 700,000 small businesses in Canada. If each of them can create just two jobs, our unemployment problem will be entirely solved.
Since the Government took office on September 4, over
200,000	new jobs have been created. There are still 1.4 million people looking for work. We must and we can do better. That is the Budget's primary objective, to create permanent jobs and get our country moving again.


THE ADMINISTRATION
Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, it is that time again, the time we have all been waiting for. I am pleased to present the Patronage Award of the Week, the PAW award. I know that many of the little piglets are looking forward to this. To those who are still waiting for the bacon, I say don't make a ham of yourself and just check every three hours with the Prime Minister's Office to see if you have been called to the trough. For bringing outstanding qualifications needed to fill their new appointments, the nominees for this week's award are:


Mr. Nunziata:: William Hawkins.


Don Boudria: William Hawkins, a Conservative fund raiser appointed to the Textile and Clothing Board, who still has no idea why he was appointed.


John V. Nunziata: Gayle Christie.


Don Boudria: Gayle Christie, the Duchess of York, appointed to the Board of Air Canada, who said she knew how to drive a car.


John V. Nunziata: Marie Marchand.


Don Boudria: Marie Marchand of North Bay, who said that she was qualified because her grandfather was a well-known railroader in the Maritimes. Could I have the envelope, please. The patronage award this week is given to Marie Marchand.


Some Hon. Members:: Hear, hear!


EMPLOYMENT
Mr. Ted Schellenberg (Nanaimo-Alberni):: Mr. Speaker, it has become a tradition over the past two weeks in this House to follow the charge of the rodent brigade with a Survivor of the Week Award, but a major government initiative came out yesterday, and we thought perhaps they might be a little more responsible and a little more serious today. We do not have a survivor award today, and I do have a few words about our major initiative yesterday.
Today is the day for all Canadians to be proud of the Government.


Some Hon. Members:: Hear, hear!


Ted William Schellenberg: Eight months ago the country voted overwhelmingly for change, for new direction, for better management, for fiscal responsibility and, above all, Canadians voted for jobs. Since September 201,000 jobs have been created, 89,000 in April alone.


Ms. Copps:: Where are they?


Ted William Schellenberg: Sheila, did anybody ever tell you that you are beautiful when you are angry?


Some Hon. Members:: Hear, hear!


Ted William Schellenberg: The Government recently allocated $900 million for private sector and community-based job creation programs, another $900 million to this innovative approach to job creation.
Do you know, Mr. Speaker, what is going to happen in Question Period, as if you don't know? First, the same group who defeated the realistic Crosbie Budget in 1979 will get up and try to do the same thing again. They are not going to do it. Those negative nellies are not going to do it. The Right Hon. Leader of the Opposition (Mr. Turner), from Howe Street, or Bay Street, wherever he is from, will give us some of the same destructive criticism that his finance critic gave us yesterday. That is irresponsible, Mr. Speaker. Canadian citizens demand more.


Mr. Speaker:: Order. The Hon. Member's time has expired.

May 24, 1985
Oral Questions



ORAL QUESTION PERIOD


Right Hon. John N. Turner (Leader of the Opposition):: Mr. Speaker, my question is for the Minister of Finance. Yesterday's Budget was quite simply an attack on the elderly, the poor, and the middle class. Derived from the Minister's own Budget Papers, I would like to state some facts that he viciously hid from Canadians yesterday. By 1990 a family with an income of $15,000 per year will pay 36 per cent more in taxes. By 1990 a family with an income of $30,000 will pay 11 per cent more in taxes. But a family with an income of $100,000 per year will only pay 4 per cent more in taxes by 1990. On top of that, wealthy Canadians with money to invest will receive a lifetime cash bonus of $125,000. In light of those facts, I would ask the Minister if that is his idea of a fair Budget.


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, I think Canadians understand that with the way the Leader of the Opposition has played with figures this time, and the way he played with figures last time, no one is going to believe the figures that he puts out.
I think one of the things that has characterized the response of a broad range of people to this Budget is that it has been fair.


Some Hon. Members:: Oh, oh!


Mr. Wilson (Etobicoke Centre):: Everyone has been asked to share a little bit of the burden in order to get the budget deficit and the accumulating debt problem under control. I think that asking each Canadian to pay a little bit is supported.
The Hon. Member spoke of the elderly. I think that many of the elderly are very worried today about the burden that is being left for their grandchildren. If we do not get on top of that problem there will be a very, very serious situation that will have to be dealt with by future generations.


INVESTMENT TAX EXEMPTION
John Napier Turner: Mr. Speaker, the figures I recited come from page 74 of the Minister's own Budget Papers. Next year the average Canadian family will be nailed with a tax increase of somewhere between $350 and $500 per year. A wealthy Canadian with money to invest will receive a cash bonanza over a lifetime of $125,000. The Minister explained yesterday in his budget speech that that was to stimulate Canadian business. Why did he not limit the application of that exemption to investment in small Canadian-owned business, or to Canadian companies listed on the Canadian Stock Exchange? Why did he allow this exemption to apply to investment in Florida real estate, or
European art? My question really boils down to why did the Minister pay as much attention to Miami Beach as he did to Thunder Bay.


Geoff Wilson: Mr. Speaker, over the years a lot of money has gone to Miami Beach because people did not have the confidence to invest their money in Canada.


Some Hon. Members:: Hear, hear!


Michael Holcombe Wilson: This Budget and other actions that we have taken are creating an atmosphere and environment in Canada that will draw those billions of dollars that have left Canada in the last five years back to Canada to create jobs here, not in Miami Beach.
I would like to make one more point if I may, Mr. Speaker. The Hon. Member is a lawyer. He knows that if we put those rules into the tax system it would result in a tremendously complex tax system. He also knows that people would be able to find ways around it. So, we are not going to put a picket fence on it; we are going to give them the environment so they can put their money into Canada to create jobs.


Some Hon. Members:: Hear, hear!


Mr. Speaker:: Order, please.


IMPLEMENTATION OF DIRECT TAX INCREASE-GOVERNMENT POSITION
John Napier Turner: Mr. Speaker, I want to protest against the less obvious aspects of the income tax increases announced by the Minister yesterday afternoon.
As a result of de-indexing, the taxable income of Canadians will rise 3 per cent annually. Family allowance cheques will drop 3 per cent, year after year. Old Age Security pensions will go down 3 per cent. In 1989, Canadians receiving Old Age Security benefits will lose $30 a month, with the Government taking advantage of this massive tax increase, notwithstanding inflation.
My question is as follows: Did the Minister take this step because he knew that Canadian men and women would be flatly opposed to a direct tax increase as sizeable as these stealthily introduced increases will be?


Geoff Wilson: Mr. Speaker, the position which we have taken is not a sneaky position as the Hon. Member has said. We have been up front. We have stated very clearly exactly what we are going to do.


Some Hon. Members:: Hear, hear!
May 24, 1985


Michael Holcombe Wilson: There will be full protection against inflation for those in need-people who are receiving the Guaranteed Income Supplement. There will be modified protection for those who are above that, who have more money. We have said that there will be a very potent form of insurance for those people, that if inflation rises higher than 3 per cent they will receive some protection. But I underline the fact that the OAS will not be reduced. It will be increased over the years if inflation is greater than 3 per cent.


REQUEST THAT DEPARTMENTAL PROJECTIONS BE TABLED
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, my question is directed to the Minister of Finance. When it comes to imposing new taxes, cutting programs, or giving benefits to the rich, his Budget was clear, detailed, and immediate; as it was with the granting of $125,000 capital gains tax cut to those who are selling their yachts, diamonds, and paintings, or when he cut $78 million from high skilled job training this year. But when it comes to job creation his Budget is vague, obscure, and hypothetical. He is asking Canadians to pay for the Western Energy Accord now with high taxes, and he is offering them pie in the sky in the future with respect to job creation.
Will the Minister immediately table in the House the projections of his Department with respect to the job losses which will result from the Budget? Will he be as clear-cut with the Canadian people on job losses as he is with taxes?
Geoff Wilson: Mr. Speaker, the Budget is about jobs. It will create jobs.


Some Hon. Members:: Hear, hear!


Michael Holcombe Wilson: It is also a clear break from the past. The Hon. Member is looking for that little security blanket that tells him that something will happen because the computer says it will happen. Let me remind him that the 50,000 to 100,000 jobs which his Leader said would be lost as a result of the November 8 statement, turned into a very large number of jobs being created. I believe about
143,000	jobs have been created since then, and 200,000 jobs have been created since this Government took office. This demonstrates to me that the Canadian people are responding to the positive and different approach we are taking, and that will continue, reinforced by this Budget.
[DOT] (U25)


Some Hon. Members:: Hear, hear!


JOB CREATION
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, I have a supplementary.
When the Minister removes $1.2 billion from the Canadian economy with his new taxes and program cutbacks for 1985-
Ora/ Questions
86, according to a macro-economic analysis, the result will be a loss of between 125,000 and 150,000 jobs, and this does not include, for instance, Public Service cutbacks and the cutbacks in Cape Breton. By what strange logic does the Minister figure that his Budget will increase employment? By how much? And in what occupations? In what regions of this country? Just for once, is the Minister going to be honest with Canadians?
Geoff Wilson: Mr. Speaker, the people said after the November statement, and people are saying today, that we have been honest with the Canadian people. It's all out front. It's all there for them to see.
The Hon. Member is asking for numbers. His Party said in November that there would be 50,000 to 100,000 jobs lost. It was wrong then, and it is going to be wrong again today. Let me remind the Hon. Member that, without the benefit of a computer model, 89,000 jobs were created in the month of April. That is the largest single increase in jobs in five years. That will happen again.


Some Hon. Members:: Hear, hear!


MINIMUM TAX FOR THE RICH-GOVERNMENT POSITION
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, my question is directed to the Prime Minister. During the election campaign, the Prime Minister promised to introduce a minimum income tax for the rich. In November, in this very House, the Prime Minister again promised us the same tax for the rich. In the Budget, however, the Government has found several new ways of increasing the average family's income tax by $500. My question to the Prime Minister is as follows: Why was the Government unable to find a single way to introduce a minimum income tax for the rich in this Budget?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, I would have thought the Leader of the New Democratic Party would be congratulating us for introducing, for the first time, a special tax on banks and trust companies-


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: -and a special tax on the richest people in our society. In consultation with the provinces, a minimum income tax program has already been announced for the 1986 fiscal year. 1 think this is already a tremendous step towards achieving equity across the country, and I think that is what comes across in the Budget speech.


John Edward Broadbent: Mr. Speaker, the Prime Minister knows that what the Government took away with one hand from the banks, it gave back with the other hand. But we will get to that in the debate later on.

May 24, 1985
Oral Questions


SITUATION OF BANK PRESIDENT
John Edward Broadbent: Mr. Speaker, my supplementary question to the Prime Minister deals with his alleged concern about fairness in the tax system and his often cited reference to his friend, the $500,000 a year bank president, about whom he used to talk. Will the Prime Minister candidly admit to the House that the Government, which has imposed a $500 tax increase on the average family in this Budget, will this year permit his $500,000 a year friend, the bank president, to get away without paying a cent in taxes? Will he admit that?


Geoff Wilson: Mr. Speaker, this Budget has introduced a number of measures which are clearly fair to a broad range of Canadians.


John Edward Broadbent: Oh?


Michael Holcombe Wilson: That individual is going to be paying a major surtax. I am somewhat reluctant to state the amount of the surtax for someone who is earning $500,000, because it is a very large amount of money. But for the persons making $200,000, I believe the amount is $4,700 more-


Mr. Deans:: If they pay tax.


Michael Holcombe Wilson: -that they will be paying in taxes. The Hon. Member asked why we have not been precise about a minimum tax this year. That is because both Saskatchewan and Quebec have introduced two different types of minimum tax and we want to make sure there will be a broad range of harmony across the tax system in Canada, with the same minimum tax and the greatest amount of harmonization between the tax systems of the various provinces.


John Edward Broadbent: All I will say to that is that the Government did not care one hoot about harmony across the country when it imposed taxes on ordinary working families right across the board.


SURTAX INQUIRY
John Edward Broadbent: Mr. Speaker, since the Prime Minister has decided to opt out of any defence of his failure to bring in a minimum on the rich, I will go back to the Minister of Finance.
Will the Minister admit to the House that the surtax which he has talked about introducing will not be paid at all by someone who has no tax payable; that all the incentives he has built into his Budget will encourage more people to become part of that very inclusive category of rich people who do not have to pay any tax, and they will not have to pay his surtax at all? Is this the Tory concept of fairness, $500 in taxes for the average family, and the rich go scot-free again?


Geoff Wilson: Mr. Speaker, let me remind the Hon. Member that taxation must be introduced in a fair way.


Some Hon. Members:: Oh, oh!


John Edward Broadbent: You don't need to tell me that.


Michael Holcombe Wilson: This Budget addresses the question of new taxes in a fair way. We did not do it the way the previous Government did in 1981 when there were 35 retroactive changes in taxes. That has not been done this time because we want to ensure that people who are paying additional taxes will be paying them in a fair way.


ANNOUNCED CLOSURE OF CAPE BRETON HEAVY WATER PLANTS
Mr. David Dingwall (Cape Breton-East Richmond):: Mr. Speaker, my question is directed to the Minister of Finance. I am glad he used the term "honesty" because he ought to know that his colleague, the Minister of Energy, Mines and Resources, on two specific occasions-


Mr. Tobin:: And the Prime Minister.


David Charles Dingwall: -and the Prime Minister indicated their commitment to the heavy water plants. I want to quote the following words used by the Minister of Energy, Mines and Resources:
My plans to close the two heavy water plants will not proceed before alternate employment can be found for displaced workers.
Will the Minister of Finance explain to this House why he and his officials, and the Prime Minister, have deceived the people of Nova Scotia? Why are they implementing a Scheff-erville solution to the chronic regional disparities in the country?


Geoff Wilson: Mr. Speaker, I think we have been honest and direct with the people of Cape Breton. They know, and the Hon. Member knows, that to spend $200,000 per job just to keep two heavy water plants operating, when there is no market for their product, is a deception on the people of Cape Breton, and we have addressed that problem.
What we have put in their place, consistent with what the Hon. Minister of Energy, Mines and Resources has said, is the most generous tax package ever made available to any region of the country, an investment tax credit which affects the broadest range of economic activity possible. The result will be that for almost any new investment in Cape Breton there will be no corporate tax paid for the next 10 years.


David Charles Dingwall: So much for the Minister's honesty.
May 24, 1985


GOVERNMENT'S POSITION
David Charles Dingwall: Mr. Speaker, we are talking about a commitment that the Minister of Energy, Mines and Resources made to have jobs for the displaced workers, and there are no jobs. Why don't you stand in your place and come clean with the people of Canada and admit that you deceived them in the election, you deceived them on November 8, and you deceived them now? Will the Minister explain why it is fair to give the multinational oil companies $1.3 billion in tax advantages when he cannot find enough money for additional job creation funds? Explain the fairness there?


Geoff Wilson: Mr. Speaker, so there is no deception here, why doesn't the Hon. Member come clean and tell us all that he is running for the leadership of the Liberal Party of Nova Scotia?


Some Hon. Members:: Hear, hear!


Mr. Guilbault (Saint-Jacques):: Wrong again.


Some Hon. Members:: Wrong again.


Mr. Epp (Provencher):: You mean they don't want him?


Michael Holcombe Wilson: The little twitch in the corner of the Hon. Member's lips betrays the announcement he made the other night.
Mr. Speaker, let me be quite clear. The Minister of Regional Industrial Expansion is in Cape Breton today setting out clearly-


John Edward Broadbent: He will be lucky to get out alive.


Michael Holcombe Wilson: -what the Government's plans are regarding the people who are losing their jobs resulting from the closure of the heavy water plants. He will also be announcing the arrangements that will be made for those people, how we will be able to help them in finding new employment, and how we are going to establish an advisory committee to come up with-


Mr. Speaker:: Order. With great respect.


Michael Holcombe Wilson: -to replace those jobs.


Mr. Speaker:: This answer is too long. Under the circumstances, a very short supplementary.


MINISTER'S POSITION
David Charles Dingwall: For the
record, Mr. Speaker, on Tuesday evening I informed my constituents that I will not be a candidate for the leadership of the Nova Scotia Liberal Party.


Some Hon. Members:: Hear, hear!


David Charles Dingwall: After this Budget the opportunity is here.
Oral Questions
Why is the Minister of Finance playing cheap partisan politics with the lives of these people? When will he come clean with the people of Canada and admit that his Budget is for the rich and is definitely against Atlantic Canadians?


Geoff Wilson: Mr. Speaker, Nova Scotia has been saved.


Some Hon. Members:: Hear, hear!


Don Boudria: Not by you.


David Charles Dingwall: So much for integrity.


Michael Holcombe Wilson: Mr. Speaker, we are very sensitive to the position of the people of Cape Breton. That is why the Minister of Regional Industrial Expansion is there now. He is not walking away from the problem. He has gone there to meet with the people and lay out, in very clear terms, the various ways we are going to address the problems they are facing and at the same time do more for the economy of Cape Breton than has been the case with those heavy water plants which everyone in Nova Scotia, including Cape Breton, knew had to be closed. We are meeting a problem here, but we are meeting it in a way that will make for a healthier economy and a more permanent degree of job creation in Cape Breton.


LABOUR CONDITIONS
Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, my question is also directed to the Minister of Finance. He indicated yesterday that his Budget would be a very fair one. He will also be aware that there are 500,000 young people unemployed during this International Year of Youth. There are also 600,000 women in Canada who are jobless today. Yet the Budget failed to set aside any amount of money for direction job creation. By his own admission in this Budget, unemployment will remain at 10 per cent or more for the rest of the decade. Why has the Minister decided to allow these very high levels of unemployment to continue? Is this his idea of fairness?


Miss MacDonald:: You have got to be kidding.


Geoff Wilson: There is only scattered applause for that question, and for a very good reason. Back in November his Leader and the Hon. Member for Essex-Windsor said we were going to destroy 50,000 to
100,000	jobs. In April some 89,000 jobs were created, the majority of which were for women.
We are not doing this in the way that the NDP would like us to, and that the Liberals did during their term in office. We have said that this is a clear break from the past. We are going to encourage and motivate the private sector, particularly the

May 24, 1985
Oral Questions
small business people, to get out and build the country and create those jobs for women and younger people. In that way we will solve the unemployment problem.


Some Hon. Members:: Hear, hear!


BUDGET IMPACT STUDIES
Nelson Andrew Riis: Mr. Speaker, in spite of what the Minister of Finance has just said, by his own admission unemployment levels will remain in excess of 10 per cent for the rest of the decade. I got that from the Budget.
The Minister's officials in the Department of Finance indicated that studies have been done to evaluate the impact of the Budget on the various regions of Canada and on the various sectors of the economy in terms of job creation. If the Minister of Finance has the confidence which he says he has in this Budget, will he table those impact studies to give us all a chance to see the impact on the regions of Canada and the various sectors of our economy?


Geoff Wilson: Mr. Speaker, the Hon. Member put the same question to me in November. The result in job impact that we have seen since that time is far in excess of what the computer model said at that time that it would be. Therefore, the Hon. Member should not go around with a little black cloud over his head as he has time and again in the past. He should have confidence in the people of Canada. He should have confidence in the future and watch the jobs being created.


Some Hon. Members:: Hear, hear!


THE BUDGET
Miss Aideen Nicholson (Trinity):: Mr. Speaker, my question is directed to the Minister of Finance. The Government promised a tough but fair Budget. It seems that middle and low-income families have been singled out for most of the tough treatment and little of the fair treatment. For the nearly 60 per cent of Canadian families earning less than $25,000 a year, this Budget is brutal.
On March 1 the Minister said that he was not in favour of general tax increases lest they "dampen the economy". Will the Minister tell the House what caused the 180 degree turn before March 1 and May 22?


Geoff Wilson: There is no 180 degree turn, Mr. Speaker. I said at that time that my preference was not for a general tax increase in the sense of having an increase in the rates. I have said that the impact that we want from this Budget must be seen to be fair. The decisions that we have put in place today will result in 80 per cent of deficit cutting coming from expenditure reductions, and only 20 per cent coming from tax increases. Those tax
increases are spread over a broad range of things and people in the country, and have been regarded as fair. Everyone is sharing in it. Everyone is shouldering some of the burden. I think the result will be a much more optimistic outlook, particularly as it relates to-


Mr. Speaker:: Order, please. This is becoming a speech. The Hon. Member for Trinity on a supplementary question.


EFFECT ON UNEMPLOYMENT
Aideen Nicholson: Mr. Speaker, the Budget is bad news for middle and low-income Canadians, but for the 1.4 million unemployed it is a disaster. We need growth to make any real reduction in unemployment. The Budget Papers anticipate GNP growth of only 2.4 per cent in 1986, half the rate when the Liberal Government was in power in 1984. The Budget Papers say that in 1985 consumption spurred economic growth. This Budget strips spending power from the average-


Mr. Speaker:: Order, please. A question please.


Aideen Nicholson: Will the Minister admit that his Budget measures not only dampen the economy but may choke off recovery, and that as a result even the slight reduction of unemployment which he projects for 1986 will not be attainable?


Geoff Wilson: Mr. Speaker, if the Hon. Member wants to use numbers, let me ask her to comment on this. Two hundred and one thousand jobs-


Mr. Gauthier:: No, you are answering the question.


Michael Holcombe Wilson: I am answering the question. Two hundred and one thousand jobs were created since September 1. In the previous year, over the same period when the Liberals were in power, 72,000 jobs were created.


Mr. Axworthy:: Two hundred and fifty-five thousand. Quit lying, Wilson.


Michael Holcombe Wilson: The Hon. Member has asked a specific question, Mr. Speaker. She wants to know what we are doing through this Budget for the 1.4 million Canadians without jobs. What we are doing is telling 700,000 small businesses that they will have a tremendous impact on unemployment if they create one or two jobs each. If they do that, many of those people will be able to-


Mr. Speaker:: Order, please. This is supposed to be Question Period.


EFFECT ON FAMILIES
Ms. Margaret Mitchell (Vancouver East):: My question is also directed to the Minister of Finance, Mr. Speaker. Yesterday the Minister gave a $500,000 capital gains gift to the rich and $2 billion to the oil companies, while he reduced indexation of family allowances and old age pensions. He cut child
May 24, 1985

benefits for families and provided no jobs for the unemployed. How can he say that this is being fair to Canadian families?


Some Hon. Members:: Hear, hear!


Geoff Wilson: Mr. Speaker, I think the Hon. Member has forgotten that there are many small business people who will receive the benefits of that capital gains exemption. Many farmers will receive the benefits of that capital gains exemption. Many people will receive jobs as a result of the encouragement to small business which has been given by that capital gains exemption.
The Hon. Member should allow her mind to expand a little bit to try to understand the new directions that we are staking out in this Budget. It is a break from the past, and it will result in better job creation in the future.


Margaret Anne Mitchell: Mr. Speaker, I wish the Minister would allow his mind to expand to consider the many poor people in the country who are getting no benefits at all.


IMPACT OF TAX INCREASES
Margaret Anne Mitchell: How can the
Minister say that he is being fair to families with the greatest need in the country, most of which are headed by women, when with one hand he gives them a measly $70 increase in the Child Tax Credit, and with the other zaps them with something like $500 a year in increased taxes and additional costs? Poor families have to pay these costs in the same amounts as rich families. There are increased costs for shampoo and drinks for kids, pet food, gas, and even heating the home.


Geoff Wilson: Mr. Speaker, I think the Hon. Member is forgetting that in the past 15 years the Government has gone from a surplus position to a $36 billion deficit position. No new jobs were created during that period.


Some Hon. Members:: Oh, oh!


Lloyd Axworthy: That is a bunch of nonsense. Come on, Wilson.


Michael Holcombe Wilson: If deficits were going to solve that job problem, it would be long since solved. We are asking Canadians to share in a broad range of things on a very reasonable and fair basis. I would like to stress once again that 80 per cent of the actions taken to reduce the deficit are through reduced spending, and only 20 per cent are through increased taxation.
Oral Questions SOCIAL SECURITY FAMILY BENEFIT PROGRAMS


Hon. Douglas C. Frith (Sudbury):: Mr. Speaker, my question is directed to the Minister of Finance. I would like to remind him of some more broken commitments, promises, and sacred trusts. Many times during the last election campaign, and in the months since, we heard the Government say that any savings that result from adjustments to the social spending program would never be used to reduce the size of the federal deficit, but would in fact be used to target those groups in our society which need help the most.
If that is true, Mr. Speaker, would the Minister of Finance explain why, in today's dollar terms, there will be $350 million less annually in the child benefits packages in 1990 than there is today? If he has done that, I want a commitment from him to replace that $350 million loss to enable poor Canadians to live comfortably, as well as the people who are getting tax breaks from capital gains.


Geoff Wilson: Mr. Speaker, 1 thought the Hon. Member was going to stand up and congratulate me for the tremendous introduction of broad reform in the pension area. That is something with which he has been very much associated, and which is very far reaching. We said we would not make changes in the social programs and the family benefit programs, that they would not be redirected into the social envelope. That has been done.


John Edward Broadbent: It has not been done.


An Hon. Member:: Again you lie.


IMPACT OF BUDGET
Douglas Cockburn Frith: Mr. Speaker, just for the record, there has been a $350 million disappearing act with this, and I can explain it afterward.


Some Hon. Members:: Oh, oh!


Mr. Murta:: To whom?


Douglas Cockburn Frith: The Government said that it wanted to target more funds to people in our society who need help more. If that is true, Mr. Speaker, will the Finance Minister explain to me and to Canadians how it is that in terms of 1985 dollars every family earning $12,000 a year and more will lose money from the child benefits package?


Geoff Wilson: Mr. Speaker, I think the Hon. Member has failed to notice that we have responded to something he raised in this House in November, the fact that people who were earning $10,000 or $15,000, from their family benefits were receiving less than those who were earning $20,000 and $30,000. We have raised that amount-

May 24, 1985
Oral Questions


Brian Vincent Tobin: If the Minister would tell the truth, we would listen.


Sheila Maureen Copps: They all receive less.


Michael Holcombe Wilson: If I can finish for the loudmouths on the other side, Mr. Speaker-


Some Hon. Members:: Hear, hear!


Some Hon. Members:: Oh, oh!


Michael Holcombe Wilson: We have increased that amount so that everybody who is earning-I think the break even point is about $25,000-525,000 or less, will be earning more in their family benefits after these changes are phased in.


An Hon. Member:: No.


WESTERN ACCORD-GASOLINE PRICES
Mr. Ian Waddell (Vancouver-Kingsway):: Mr. Speaker, my question is for the Minister of Finance.


Mr. Clark (Yellowhead):: Read us half a letter.


Ian Gardiner Waddell: I would like to challenge him on his notion of fairness with respect to the energy aspects of the Budget. The Minister is aware that in the Western Energy Accord the Government gave about $2 billion to the oil companies, much of it in windfalls for old oil that was even in the ground already.


Some Hon. Members:: Oh, oh!


Ian Gardiner Waddell: Why did the Minister say to us in the House and to the Canadian consumers, through the Minister of Energy, Mines and Resources, that the consumers would not suffer as a result of all that money being given to the oil companies? Why does the Minister think it fair that the Canadian motorist should be hosed in this Budget to pay for all that money in tax breaks that went to the oil industry?


Geoff Wilson: Mr. Speaker, we are learning new things every day. I thought oil always came out of the ground. Is the Hon. Member telling me something different? Does it come from the sky?


Some Hon. Members:: Oh, oh!


Charles Joseph Clark: To the NDP it is like money; it is supposed to grow on trees.


Michael Holcombe Wilson: What I think the Hon. Member continues to fail to understand is that the increased cash flow that will be generated by the oil companies will be reinvested in the economy-


Ian Deans: How do you know?


Michael Holcombe Wilson: -will be creating jobs right across the country, including Vancouver-Kingsway-


Mr. Hnatyshyn:: The record speaks for itself.


Michael Holcombe Wilson: It will be creating those jobs and making this country a healthier place. We have identified the oil industry as being the real engine of growth.


Ian Deans: You have to pay to keep the engine running.


Michael Holcombe Wilson: That is why we say it is fair in the broad context of this Budget to encourage things like the oil and gas industry which will be creating the jobs that all Members opposite say we should be creating.


Ian Gardiner Waddell: Mr. Speaker, perhaps the Minister reads Shakespeare. He may remember one of those witches in Macbeth who said: "So fair and foul a day I have not seen".


Some Hon. Members:: Oh, oh!


USE OF GASOLINE TAX
Ian Gardiner Waddell: Let me ask a
supplementary question of the Minister of Finance. This is a foul Budget. He is giving away $9 billion to the oil companies over the next five years. He still has to get more money from the Canadian motorists to pay for it. Is it his notion of fairness that the Canadian motorist, the fisherman, and the farmer, will have to pay all that money that went to the oil companies, which is just a hope and a prayer of creating jobs compared to the money being taken out of the pockets of ordinary Canadians at the gas pumps?


Geoff Wilson: Mr. Speaker, the Hon. Member calls it a hope and a prayer. We have confidence in the small business community-


John Edward Broadbent: He is talking about the oil companies.


Michael Holcombe Wilson: In the oil and gas community to create those jobs. I want to refer the Hon. Member to the fact that since the Energy Accord was announced $3.6 nillion worth of new projects has been announced. That is how the jobs will be created, and that is why this Budget will be fair, and will be seen to be fair right across the country.


Some Hon. Members:: Hear, hear!


AGRICULTURE
Geoff Wilson: Mr. Speaker, my question is for the Minister of Finance. While I applaud the lifetime capital gains exemption included in the Budget, why did the Minister stop at $500,000? Why did the Minister not act on the recommendation of the all-Party
May 24, 1985

finance committee to abolish it altogether? Since the Minister did not, can he at least assure this House and the agricultural community that the intergenerational tax free transfer of farm lands will be available to help preserve the family farm?


John Edward Broadbent: The Minister is a flaming socialist, according to that Member.


Mr.   de Cotret@: It is a better question than from the Opposition.


Geoff Wilson: Mr. Speaker, let me respond directly to the Hon. Member. We looked at whether it was possible to have an unlimited exemption for farm properties-


John Edward Broadbent: That is next year.


Michael Holcombe Wilson: -as had been requested by a number of Members representing the farm community. We felt that was not possible under the current financial circumstances of the Government of Canada.


Ian Deans: Later.


Michael Holcombe Wilson: However, we did put in a limit which I think was consistent with what the finance committee had recommended. We have also maintained the intergenerational roll-over so that farmers will be able to pass on their farms to the next generation without any payment of capital gains.


THE BUDGET
Jean-Claude Malépart: Mr. Speaker, I have a question for the Minister of Finance.
In his Budget yesterday the Minister decided to cut $2.5 million off the pension income of elderly Canadians through a reduction in pension income indexation. In addition, the Minister struck a low blow to the poorest senior citizens of Canada, those who receive the guaranteed income supplement. Is the Minister aware-


Some Hon. Members:: That is not true.


Jean-Claude Malépart: Is the Minister aware of the fact that the income of a person alone who gets the old age security pension amounts to $605.20 a month? This income is made up of the $368 monthly income supplement which will still be indexed-


Some Hon. Members:: Ah, ah!


Jean-Claude Malépart: -and the $276 basic pension, that is the total old age security pension-


Some Hon. Members:: Order!
Oral Questions


Jean-Claude Malépart: Here is my question, Mr. Speaker. Can the Minister explain why he did not maintain full basic pension indexation for the 1.3 million senior citizens who receive the guaranteed income supplement?


Geoff Wilson: Mr. Speaker, I think the preamble and the question itself are misleading and create a false impression in the House.
I would like to assure all Canadians who are receiving the GIS that it will continue to be indexed to the consumer price index. The people who are receiving old age security will receive indexation protection over an inflation rate of 3 per cent.


Sheila Maureen Copps: In other words, it will go down by 3 per cent. [Translation]


Mr. Speaker:: The Hon. Member for Montreal-Sainte-Marie (Mr. Malepart) for a short supplementary question.


CUTS TO PENSION INCOME OF THE ELDERLY
Jean-Claude Malépart: have a supplementary question, Mr. Speaker.
Can the Minister of Finance explain what social justice criteria prompted him to launch an immediate attack against the elderly by reducing their pension income, while at the same time he could not find any justification-


Some Hon. Members:: That is completely false.


Jean-Claude Malépart: -for going after the 6,000 Canadians who earn $50,000 or more and do not pay any income tax?


Geoff Wilson: Mr. Speaker, I must apologize. I was listening to the translation, and it sounds to me from the translation that the premise of the Hon. Member's question is false.


Some Hon. Members:: No.


Michael Holcombe Wilson: I will be happy to discuss the matter with him afterward. What I said in my first response is that people who are receiving the guaranteed income supplement will receive full indexation on the GIS.


An Hon. Member:: What about the base?


Michael Holcombe Wilson: On the OAS they will continue to receive indexation protection, inflation protection, over 3 per cent. I believe Canadians who are looking at the results of what has happened over the past 10 to 15 years, Canadians who are very sensitive to the ravages of inflation, are very sensitive to the impact of the deficit on inflation, are prepared to make a small sacrifice in the interest -


Mr. Speaker:: Order, please.

May 24, 1985
Oral Questions PENSIONS


Michael Holcombe Wilson: Pensioners are saying to me: "If you don't deal with that deficit-"


GOVERNMENT POSITION
Mr. Neil Young (Beaches):: Mr. Speaker, yesterday we saw a Budget which gave $500,000 to the rich, another $2 billion to the oil companies, and a 3 per cent cut in old age pensions. Earlier in Question Period the Minister of Finance said that the Government was being honest with Canadians. Was he also being honest with Canadians when he promised during the election campaign to index the OAS fully? Was he honest with Canadians when he promised a standing committee of the House that pensions would not be touched in any Budget? Was that a sacred trust that the Prime Minister promised? I think he was being totally dishonest with the Canadian people.


Geoff Wilson: Mr. Speaker, the thrust of this Budget is to encourage small business people to create jobs. There will be many new jobs created by the encouragement of those small business people. Perhaps the Hon. Member has forgotten that there are many small business people who aren't rich Canadians but who are looking to build something for themselves, something for their children, and to leave something of real positive benefit to the country. That is the kind of Canadian we are trying to encourage.


Mr. Speaker:: Under the circumstances, on a very short supplementary question, the Hon. Member for Beaches.


ELECTION STATEMENT
Neil Young: Mr. Speaker, when the statement was made during the election campaign that a PC Government would once more index the OAS to the actual cost of living on a quarterly basis, was the Minister of Finance being honest with Canadians then?


Some Hon. Members:: No.


Geoff Wilson: Mr. Speaker, I explained very clearly in the Budget yesterday that it was important for us, for all Canadians, to come to grips with the very serious deficit and accumulating debt problem facing us. The debt of the country has been growing three times faster than the economy of the country.


Some Hon. Members:: Oh, oh!


Michael Holcombe Wilson: Hon. Members say "Oh"; they do not care about that. I will tell them that there are many elderly people who are very worried about that and about the fact that government previously had done nothing to attack that problem.


Some Hon. Members:: Hear, hear!


Michael Holcombe Wilson: I believe the response I have heard to date from elderly Canadians-


John Edward Broadbent: What have you heard from pensioners?


Some Hon. Members:: Oh, come on!


Michael Holcombe Wilson: "-you are going to leave either an enormous problem for our children, or you are going to inflate this country away so that our pensions, the pensions we have today, will just be lost in a pool of red ink."


CLERK OF PETITIONS' REPORTS
Mr. Speaker:: I have the honour to inform the House that the petitions presented by Hon. Members on Thursday, May 23, 1985, meet the requirements of the Standing Orders as to form.



POINT OF ORDER


Ian Deans: Mr. Speaker, I rise on what 1 hope will be a very brief point of order to ask you to look into a matter which I noted yesterday during the delivery of the Budget by the Minister of Finance (Mr. Wilson). I had occasion yesterday to watch the proceedings on the monitor in the opposition lobby. The monitor, as I watched it, showed coverage of the House of Commons which, in my opinion- and I think with the benefit of your having viewed it perhaps it may well be Your Honour's opinion-was quite different from the coverage normally provided of the proceedings of the House.
As you know, Mr. Speaker, during the proceedings of the House it has been the practice agreed upon by the House that the coverage would focus narrowly on the person who was making the address and not on any other individual, nor would it show any other but a very tight picture of that person on his or her feet.
Yesterday the coverage showed extensive participation by Conservative Members on the government side of the House on a number of occasions, in particular during those occasions when the Minister of Finance paused in order to allow his colleagues to applaud as they had been hyped up to do.


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!


Ian Deans: I want to ask you, Sir, if you would be kind enough, if you have not already done it, to view the coverage of yesterday's proceedings and to determine whether in fact there was a breach of the normally accepted practice which was approved in the past by all Parties; and, if that breach did occur, to find out under whose direction that breach took place; and to ensure in the future that if there is to be any
May 24, 1985

deviation from that coverage which has been accepted by Members of the House of Commons as suitable to our purposes, that that matter be discussed in advance, not only with the Speaker, but with representatives of each of the Parties, in order to ensure that there is agreement on the change.


Hon. Herb Gray (Windsor West):: Mr. Speaker, I want to make a brief comment on the point of order raised by the NDP House Leader. When television was brought into this Chamber, it was on the basis that it would be an electronic Hansard, an electronic record of the debate. Any departure from that concept is something which I think should not take place without careful consideration and the agreement of all Parties.
I would urge you, Sir, to look into this matter and respond, in your wisdom, on the basis of the principle which was established when the broadcasting of the House of Commons began some years ago.


Ramon John Hnatyshyn: Mr. Speaker, I just want to comment briefly on the point of order raised by the Hon. Member for Hamilton Mountain (Mr. Deans). When Your Honour enters into an examination of the coverage of that particular debate, which has been brought about by the fact that the Hon. House Leader of the New Democratic Party and all his caucus were apparently watching it on the monitor in the course of delivery, I ask you to consider looking back at the precedents established on prior budget debates. I have been around here a couple of years and I remember the kind of coverage they were given. Granted, 1 have not seen what coverage was given of it yesterday, but 1 can tell you, Mr. Speaker, that there were wide-angle shots on the occasion of every major budget delivery and there has been panning of the House. This technique is not unusual on the basis of precedents.
I simply say that I understand the rules are there, and 1 am not asking for any exception with respect to any particular circumstance because we happen to be in Government.


Mr. Fulton:: The question, Ray, is: Who told them to do it?


Ramon John Hnatyshyn: Mr. Speaker, that is unworthy of the Hon. Member. He knows that the Speaker is in charge of the television system, and to accuse the Speaker of directing them to use the coverage is unworthy of him, even in the circumstances we have today.


Mr. Speaker:: As Hon. Members know, I will look into the matter. Of course I will consult all the precedents, all the practices and all the rules. Perhaps it would be helpful if we just left the matter for me to look into, as I was requested to do in the beginning.
Order Paper Questions



ROUTINE PROCEEDINGS


Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, I have the honour to present a petition from 250 citizens of Kitchener who are protesting the damage done to the unemployed by the Government's fiscal policy. They are also pointing to the special unemployment problems of middle-aged and older workers. I expect that it will be the first of many such petitions now that the Budget has been brought in.


Mr. John R. Rodriguez (Nickel Belt):: Mr. Speaker, I have the honour to present a petition signed by many residents of Windsor, Ontario, protesting the change in the unemployment insurance program whereby severance pay would be used in calculating unemployment insurance benefits.


Hon. Barbara McDougall (Minister of State (Finance)) moved: for leave to introduce Bill C-51, an Act to provide borrowing authority.


Mr. Speaker:: Shall the Hon. Minister have leave to introduce the Bill?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, Bill read the first time and ordered to be printed.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Paul Dick (Parliamentary Secretary to President of Privy Council):: Mr. Speaker, the following questions will be answered today: Nos. 273 and 298.


Mrs. Killens: 1.	Since May, 1982, were changes made to the RCMP training programs regarding battered or molested women and, if so, what were they?
2.	(a) Between September, 1980 and May, 1982 (b) from May, 1982 to date, did the Government allocate any moneys to the financing of initial capital projects regarding new emergency and permanent transition homes for battered

May 24, 1985
Order Paper Questions
women, under the Canada Assistance Plan or any federal-provincial cost sharing agreement and, if so, in each case (i) in what amount (ii) how many emergency or permanent transition houses were established and how many women and children were thus accommodated?
3.	Since May, 1982, for each project to which funds were allocated, were the federal funds mentioned in part 2(b) allotted to personal and day care costs or to building costs only?
4.	Concerning the funds mentioned in parts 2(a) and 2(b) respectively, for what period were the funds allocated to each project?
5.	Since May, 1982 (a) how many housing units subsidized by CMHC did the Corporation order set aside for emergency or permanent transition houses for battered women and their children (b) what percentage of all housing units presently subsidized by CMHC do these units represent (c) where are they located (d) what percentage of CMHC-subsidized housing units built since 1982 do these units represent (e) how many women and children presently occupy these units and what percentage of the total number of persons presently living in CMHC-subsidized accommodation do these women and children represent?
6.	What amount was repaid to companies who were relieved from repaying unemployment insurance premiums by this decision?


Ramon John Hnatyshyn: I am
informed by the Departments of National Health and Welfare, the Solicitor General of Canada and Canada Mortgage and Housing Corporation as follows:
1.	Yes. (i) Induction training: Human Relations Training. Victimology-Police position in conflict situations. Duration: Previously three hours, now five hours. Legal aspects of domestic intervention. Duration: Previously two hours, now four hours. Applied police intervention. Duration: Previously seven hours, now 15 hours. Globe theatre live scenarios. Ethical Conduct. Ethics and professionalism. Duration: Previously two hours, now six hours.
(ii)	In-service training. Investigator's Course (10 days). Family violence, child abuse, elderly, spousal assaults. Duration: Previously one half day, now two days. Victims and witnesses of crime. Duration: Previously one half day, now one day.
(iii)	Canadian Police College Courses. Crisis and conflict intervention (10 days). A new session has been inserted on victimology. Duration: one half day. Another new session was added on social agency linking. Duration: one half day.
2.	(a) and (b) (i) (ii) There are no programs in the Department of National Health and Welfare, including the Canada Assistance Plan, designed for the financing of initial capital projects regarding new emergency and permanent transition homes for battered women.
The Canada Assistance Plan (CAP) enables federal sharing in the costs to provinces and municipalities of providing a wide range of assistance benefits to needy victims of family violence. These benefits include social assistance allowances, subsidized legal services, assistance with the cost of non-insured medical expenses, maintenance of the family in a transitional home or other sheltered environment. The families may also benefit from services such as day care for children, home support, crisis intervention and counselling, employment support and information/referral services.
As mentioned, one of the forms of assistance to needy victims of family violence is the maintenance of the family in a sheltered environment. These sheltered environments may be
hostels, supportive living environments, group homes or transition homes. In 1983-84 cost sharing was effected on behalf of needy women and their children in 63 transition and crisis centres in the country. It is not possible to estimate the number of victims of family violence who have received assistance under CAP. These programs are administered by the provinces and statistics are not available.
For more detailed information, see replies to questions Nos. 35 and 36 answered April 2, 1985.
3.	Costs related to the maintenance of victims of family violence in transition homes are rolled up in a per diem fee which is agreed upon by the home and the province or municipality supporting it and then cost shared on behalf of needy residents through the Canada Assistance Plan. Per diem fees reflect operating costs of the homes such as rent, utilities, food, salaries of staff engaged in the administration of the home and the provision of services such as child care, as well as travel and training costs of staff.
4.	Cost sharing under CAP is not time limited. Federal support of transition homes begins from the date of the first provincial/municipal contribution to the homes on behalf of needy residents and continues for as long as the provinces and municipalities continue to pay on behalf of needy residents.
5.	(a) 471 hostel beds have been provided in transition houses for battered women since January 1, 1982, under the Non-Profit Housing Program, with subsidy assistance under Section 56.1 of the National Housing Act.
(b)	These beds represent 0.14 per cent of the total estimated 328,442* units receiving subsidy assistance as of December 31, 1984.
(c)	See table below.
(d)	The 471 hostel beds represent 0.63 per cent of the total of approximately 75,200 units committed since January 1, 1982 under all social housing programs.
(e)	No statistics are available to the total number of occupants in housing subsidized under the Non-Profit Housing Program. The potential is for 471 women and children to be housed, when the recently approved projects are completed.
*A breakdown of these units includes:
Public housing (incl. rent supplement) 235,570 units Rural and native housing	13,872 units
Non-profit and co-operatives	79,000 units
6.	Through the National Welfare Grants program, the Department of National Health and Welfare provided a project contribution to the Yukon Women's Transition Home Society in order to test the feasibility of a multi-purpose service to northern and rural women. The project explored workable ways of offering outreach and residential services for victims of family violence as well as women in transition from treatment and correctional centres and women in need of a wide range of community services. Funding for the project began in 1979. In 1982-83 and 1983-84, National Welfare Grants provided a total of $64,732.
May 24, 1985

In addition, the Canada Assistance Plan shares on an ongoing basis in costs to the provinces of conducting welfare research and of planning new or innovative methods of delivering welfare programs. Since such costs are usually included in the general provincial costs of administering welfare programs, it is not possible to isolate them.
Location	Hostel Beds
St. John's, Nfld.	14
Halifax, N.S.	44
Montreal, Que.	94
Hamilton, Ont.	12
Kingston, Ont.	28
Kitchener, Ont.	22
London, Ont.	15
Oshawa, Ont.	16
Ottawa, Ont.	8
St. Catharines, Ont.	13
Sudbury, Ont.	24
Toronto, Ont.	39
Windsor, Ont.	15
Saskatoon, Sask.	30
Edmonton, Alta.	4
Lethbridge, Alta.	12
Red Deer, Alta.	31
Kelowna, B.C.	8
Prince George, B.C.	18
Vancouver, B.C.	24
Total	471


Mr. Lapierre: 1.	Has a government department contributed an $800,000 grant to the museum of Sept Isles and, if so (a) which one (b) under which program (c) what criteria was used to assess the grant?
2.	How many other grants, and in what amounts, were allocated to museums under the same program?
3.	What is the government's policy on museum funding?


Hon. Marcel Masse (Minister of Communications):: 1.	Yes. (a) The Department of Communications, (b) The Special Program of Cultural Initiatives, (c) The objective of the capital assistance component of the Special Program of Cultural Initiatives is to provide increased public access to the professional Canadian performing and visual arts and to Canadian heritage collections. Applications under this component must be submitted by non-profit, incorporated cultural organizations, municipal or regional governments and
(a)	must have a direct and immediate bearing on the provision or the improvement of facilities for both the public and the artists involved;
(b)	must demonstrate a provincial or territorial commitment to cost-sharing of the project.
Consultations between the federal departments and agencies and the provincial governments are undertaken as required.
2.	During the fiscal years 1983-84 and 1984-85, the following contributions to museums were approved under the capital assistance component of the Special Program;
Fondation Marc Aur&e Fortin	$ 98,000
Musee universe! de la chasse et de la nature	50,000
Musee d'art de Joliette	125,000
Nunatta Sunaqutangit Museum	100,000
Lake of the Woods Museum	150,000
Societe du Mus6e du S6minaire de Quebec	300,000
The Budget-Mr. Johnston
3.	The capital assistance component of the Special Program of Cultural Initiatives was designed to ensure that a network of cultural facilities is developed across Canada which will provide greater access to the professional performing and visual arts, museums and heritage collections, for Canadians in every region of the country. Financial assistance can be made available to Canadian non-profit incorporated organizations or municipal or regional governments.
The Museum Assistance Programs of the National Museums of Canada's National Programs provide financial and technical assistance to qualifying museums, art galleries, exhibition centres and related associations and other non-profit institutions and organizations, to help further the objectives of the National Museum Policy. These objectives are to increase physical and intellectual access to our natural, cultural and technological heritage as represented in collections across Canada, and to ensure that these collections are preserved for the benefit of present and future generations.


Mr. Speaker:: The questions as enumerated by the Parliamentary Secretary have been answered.


Paul Wyatt Dick: Mr. Speaker, I ask that the remaining questions be allowed to stand.


Mr. Speaker:: Shall the remaining questions be allowed to stand?


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Thursday, May 23, consideration of the motion of Mr. Wilson (Etobicoke Centre) that this House approves in general the budgetary policy of the Government.
Hon. Donald J. Johnston (Saint-Henri-Westmount):: Mr. Speaker, as we end the hockey season and enter the baseball season, I would like to remind the House, particularly the Minister of Finance (Mr. Wilson), of his famous namesake who played for the Giants and the Chicago Cubs, Hack Wilson. On reading the history of the National League, I see that Hack probably received more razzing than any other player in the circuit, particularly when he struck out, which was often. The Minister of Finance struck out yesterday. We say to him very sincerely that we are disappointed that he did.

May 24, 1985
The Budget-Mr. Johnston
We Liberals have a view of budgets which I would like to deal with briefly. We believe that budgets are to serve people. They are to provide Canadian people with working opportunities, an equitable and a fair tax system and, to draw upon the words of the great Sir Wilfrid Laurier, we as Liberals must strive to raise ever higher the standard of life and of living of Canadians. That is what budgets are designed to do, or should be designed to do. Laurier was not speaking of just some Canadians. He was speaking of all Canadians in all regions of this great country, in all sectors-agriculture, fisheries, forestry, mines, plant workers et cetera.

Mr. Speaker, we in the Liberal Party believe the Budget should serve all Canadians and not just one group of Canadians.

We see the strength and the growth of the economy as imperative, not for the economy's sake, but for the people's sake. The economy is there to serve the people of Canada. I suggest to you, Mr. Speaker, and to other Members of this House that this Budget handed down by our Minister of Finance establishes a clear line of demarcation between Conservative ideology on the one hand and Liberal principles on the other.


Some Hon. Members:: Hear, hear!


Donald James Johnston: Liberals have believed, continue and always will believe that the private sector is the engine of growth in this country. The Tories say they do too. What is the difference? Liberals define the private sector as comprising all Canadians: children, youth, consumers, the unemployed, working men and women, the elderly, the retired, business and labour. For Liberals, all Canadians constitute the private sector. The Tories define the private sector as comprising only the business community and those who can afford to invest. We as Liberals say that the kind of growth that this country requires, the jobs that we require need the participation of all Canadians, not just the business community and those who can afford to invest. All must participate in this growth and all must benefit from it.
That is not the case with this Budget. Here we have a first class example of the celebrated trickle-down theory. John Kenneth Galbraith, as you know, refers to this approach as horse and sparrow economics. You feed the horse enough and you hope and pray that something will be left over for the sparrows. Even worse, in this Budget there is such a heavy tax burden on Canadian consumers that demand will be dampened, unemployment will increase and, moreover, inflation will increase. The Minister of Finance knows that. In fact, he said that. Of course, the deficit is likely to increase as well.
Liberals believe in managing the public debt, controlling spending, but using the engine of growth with the co-operation of all consumers and investors, first, to control and then, of course, to reduce the deficit, a deficit I might say, notwithstanding all the declarations of those opposite, which was not
brought about by profligate spending by the previous Government. There has been some profligate spending, I might add, since the Tories have taken office. It was a deficit incurred, as Canadians know and appreciate, to cushion Canada and Canadians against the ravages of the worst recession since the 1930s.
Let me translate those thoughts on growth, from the Liberal point of view, into numbers. The last Liberal Budget, as the documents deposited by the Minister of Finance clearly show, indicate a real growth rate last year as a result of the Liberal Budget of 4.7 per cent. That is for 1984. The Minister of Finance tells us that this year the Tories anticipate a growth rate of 3.1 per cent. He tells us more, that next year he anticipates a growth rate of 2.4 per cent. That is in 1986. Similarly, under the last Liberal Budget, personal income increased in 1984 by 7 per cent. The Tories expect this to decline in the current year to 6.8 per cent and next year to see it decline further to 5.9 per cent. Canadians will soon remind themselves once again that Tory times are tough times.


Some Hon. Members:: Hear, hear!


Donald James Johnston: I predict that they will be kicking themselves for having forgotten that lesson in September of 1984. The Minister tells us about the climate of confidence that he wishes to create. Through you, Mr. Speaker, I ask the Minister of Finance, how can Canada have confidence when this Government has systematically broken promise after promise? Confidence will only be built upon credibility. This Government has lost its credibility. Those promises will be reviewed by speakers of this Party during the budget debate as we deal with the various sectors which are affected adversely by the proposals of the Minister of Finance.
One of the most recent commitments of the Minister of Finance was made as recently as on March 1 when he appeared on the program Question Period. In response to questions from Mr. Terrence Wills of the Montreal Gazette, he said:
I don't want to increase taxes, Terry. I think we have a good deal of scope on the expenditure side to deal with the deficit problem. A tax increase, certainly a general tax increase, puts a dampening effect on the economy and I don't want to see us do that.


An Hon. Member:: Who said that?


Donald James Johnston: The Minister of Finance said that. Not only was that a breach of a commitment that we witnessed yesterday and not only does it affect the credibility of the Minister, the Prime Minister (Mr. Mulroney) and the Government, but it carries very serious consequences in terms of job loss, not job creation in this country, and that is strike one against the Minister.
Recently, Pierre Lortie, the President of the Montreal Stock Exchange, with whom I am sure the Minister consulted at some length, made some comments with respect to raising taxes in a speech he gave early this month in Toronto. At that time, he said:
May 24, 1985

The problem with raising taxes lies with their indirect effects which are powerful. Raising taxes cools the economy in two ways. The first familiar effect is that taxes dampen demand. With 11 per cent unemployment, a 4 per cent inflation rate and a growth rate well below that of the U.S. economy, the Canadian economy surely does not need a cold shower.
He went on to say:
Thus, a strategy to reduce the deficit which would embody tax increases could be really hurtful to the Canadian economy.
It is pretty clear that any consultations the Minister may have had with Mr. Lortie were not heeded.
[ Translation]
-I personally would have gone further than Mr. Lortie. These tax increases will not only harm the economy, Mr. Speaker, but also and especially those Canadians who cannot protect themselves.

How many jobs will be lost? The Minister of Finance knows but he will not tell us. He will say, of course, as I have heard him say repeatedly on the radio, on television and here in the House, that it is the confidence factor which will not only replace those jobs which might be lost through some economic model study but will also create new jobs. I say to the Minister of Finance that there can be no confidence when there are these flagrant breaches of promises which have been made by the Minister and the Government. The Minister said that he did not want a general increase in taxes. We have witnessed a massive increase in taxes.
I know my colleagues have always believed in the integrity of the Minister of Finance. We can only come to the conclusion that once again he has lost a battle in Cabinet, once again he has been derailed. He did not want massive tax increases. He declared that his aim was not to have tax increases. Look at the increases that have been imposed upon us.
1 invite you, Mr. Speaker, to look at page 19 of The Fiscal Plan which tells us about new tax measures with major impacts on budgetary revenue. These numbers have been carefully caressed by netting some with others which should not be there. I am quite happy to explain my analysis of these numbers, but the bottom line of it is that in 1985-86, individual Canadians will be subjected to tax increases of $1,170 million, not the paltry $250 million which is shown at the bottom of that table, and in 1986-87, they will be subjected to tax increases of $4,360 million. I would be quite happy and anxious to debate my analysis of those numbers with the Minister of Finance.
I would point out that, among other things, I have eliminated in my calculations the so-called capital gains reduction from those revenues. Let me point out that we are talking about general tax increases. In 1982, the last year for which I have numbers, 63 per cent of all capital gains came from 4 per cent of Canadian taxpayers. I submit to the Minister of Finance that it is hardly fair game to net the lost revenue on the capital gains tax exemption against the tax increases which are going to be borne by ordinary Canadians from coast to coast. That, Mr. Speaker, is strike two. The Minister lost his battle in Cabinet. He had to submit to increased taxes, some-
The Budget-Mr. Johnston
thing which he knew was not the way to go in terms of deficit reduction.
The Minister promised us a fair Budget. Let us examine that proposition very briefly. How do these tax increases affect individual Canadians?

You know, people are going to remember the Progressive Conservative Government for its decision to promote capital gains to tax kids' candy, soap and pet food. This is of course a caricature, but the fact is that the combination of taxes introduced yesterday will crush the middle class and the poor, and I would like to give you a few examples.
For a married couple and I shall quote figures from the papers tabled in the House yesterday by the Minister for a married couple with only one income and two dependent children below the age of 18, and earning $20,000, taxes will go up $175, and that does not include sales tax, excise tax on tobacco or the tax on fuel. Altogether, it will mean an increase of at least $200 and probably more. Some people have estimated that the additional burden will amount to between $500 and $1,000 per family.

Of course, the Government and the Minister will argue and have already argued that the rich are also hit hard by this Budget. That is because of the temporary surtax which has been imposed upon them. Let us look at the circumstances of that same couple with one source of income and two dependent children. We see that carrying the tax provisions forward for the year 1990, the time frame within which the Minister of Finance spoke, the tax burden of that family at the $20,000 level will be increased by 17 per cent, using any reasonable assumptions such as those which were set forth in the table of the Minister himself. If, on the other hand, we look at a family at the $200,000 level, a family which could certainly be classified as being rich, we find that the increase will in fact be 2 per cent in the year 1990.
Many people seem to have lost sight of the fact that the surtax is an 18-month tax. It is only a blip, but the other provisions go on forever and penalize the low-income groups. In fact, if one uses that same 1982 capital gains tax distribution to which I referred a moment ago, we find that the taxpayer at the $200,000 level will pay $2,352 less in taxes in 1990. The 2 per cent figure I mentioned is there without reference to the capital gains tax break.
What about old age security? Simple calculations show that by the year 1990, the average old age security payment will be reduced by $30 per month or $369 per year. As I entered the House, I heard the Minister answering a question by saying that GIS had been indexed. However, G1S recipients, as we know, receive old age security and GIS. If the old age security costs them $30 per month, that effectively means that people who receive GIS will lose $30 per month. When the Liberal Government introduced its six and five program to cap indexation, that was taken into account. Accordingly, a double

May 24, 1985
The Budget-Mr. Johnston
indexation on GIS was provided for. The Minister has failed to do that. Elderly people at the poverty line will lose $30 per month in real dollars in the year 1990.
What about child benefits? We have calculated that once one reaches over $12,000 of income, everyone loses, and by 1990, something between $300 million and $380 million will have been taken out of the child benefit system. I say to you, Mr. Speaker, that this Budget is not only unfair, it is grossly unfair. That is strike number three for the Minister of Finance.
[ Translation]
Mr. Speaker, I was talking about people who have been adversely affected by this veritable avalanche of taxes. However, we must not forget the poorest regions of this country which have now been abandoned by the Progressive Conservatives, and especially the Atlantic Provinces and the Gaspe, for instance. In the course of this debate, you will be hearing a number of our Members who will elaborate on these questions. It is not only unfair to individuals but also unfair to the regions, and especially to the individuals living in those regions.

There is something else, Mr. Speaker, which I would like to bring to your attention, and 1 hope that you will take the opportunity to review the budget documents in detail. I reviewed them as best as I could in the time since yesterday, but I have much more to digest. It is apparent that the Budget is replete with what I call political arithmetic. What kind of climate of confidence can we expect to achieve in Canada if the Government is not forthcoming, does not give us the facts and does not tell us what will be the impacts of the various measures which have been introduced? It is one thing to tell us what the impact might be, but it is quite another to prepare the documents in such a manner that the presentation is confused and difficult to understand.
For example, there is the magic savings which the Conservative Government will accomplish by its New Management Initiatives. In 1985-86 alone, the magic savings will amount to $1.2 billion. The Conservatives call part of that plan "Improved Cash Management". Most of the better cash management will mean stripping and raping the Crown corporations of cash in the form of dividends. That is better cash management! A total of $366 million of the $1.2 billion will be saved in 1985-86. Canada Mortgage and Housing Corporation will provide $26 million, Teleglobe Canada will provide $108 million; Petro-Canada will provide $50 million; Atomic Energy of Canada will provide $50 million, and Ports Canada will provide $83 million. I will not take the time of the House to read all of the corporations which will be involved in that savings plan as the documents are available for all to see. That is better cash management! Declaring dividends from Crown corporations has now become better cash management.
There is a point which I find most troubling and I hope at some point the Minister will furnish us with adequate explanations. After the brilliant exercise of saving $1.2 billion for better management practices, we find that the expenditures for 1985-86, as presented in the budget papers, will be $105 billion. When I turned to the Estimates which were tabled in the House several months ago, I found that expenditures in 1985-86 were to be $105 billion. How on earth can we explain what is going on? How can the Government maintain any credibility when it presents us with that kind of data?
In addition, there are no five-year projections in the Budget. I remember when his colleague, the Minister of Justice (Mr. Crosbie), came into the House in 1979 and proudly proclaimed that he would introduce five-year projections. Of course, the reason he did so was that it was one of the most firm recommendations of the Lambert Commission on Financial Management and Accountability. He was the first Minister of Finance who had the opportunity to introduce those recommendations, and he did. He explained, at every occasion, the importance of having five-year projections. He explained the importance of allowing the public and others to scrutinize where the Government was intending to go. The Liberal Government which succeeded the Conservative Government of 1979 maintained that tradition through all the Budgets which were presented in the House. However, it has been abandoned by the Minister of Finance because he does not want to be forthcoming with Canadians. He does not want to tell the Canadian public where he is going to go.

What does he tell us? He tells us that between now and 1990, if I am not mistaken, he will reduce the deficit by $20 billion. But he does not want to give us forecasts, he does not want to show us how we will get there, he simply draws the conclusion.



-my constituency of Saint-Henri. Well, I would like to bring the Minister with me one of these days so he might explain to my constituents of Saint-Henri why they should pay taxes on candies and gasoline. But at the same time Ministers back here in Ottawa can increase their budgets, have well-paid staff and senior officials, not to mention the Prime Minister's Office. I really think he would have a hard time convincing the people of Saint-Henri in Montreal, which happens to be one of the regions hardest hit by this Budget.

Of course, we have seen the Government indulge in other exercises with taxpayers' money, while individual Canadians are having trouble making ends meet and living virtually from hand to mouth. But the Government treats itself to lavish spending and engages in bailing out corporations. I could cite the number of corporations which have been bailed out. They include Petromont, Domtar, the Canadian Commercial Bank, and Pioner Trust. At least those bail-outs were motivated by concerns of employment and investor confidence.
I hope the Minister of Finance takes these comments seriously because the example must be set here. This Government, of which he is a member, is the most lavish spender and the greatest squanderer of taxpayers' dollars on government lifestyle of all other Governments in the history of this country. It has the largest ministry with the largest staff. It has travelling committees to keep the back-benchers happy. Millions and millions of dollars are being squandered by the Government and by the Prime Minister with the circuses and showbiz to which we have been treated. As far as Quebec City is concerned, we have only seen the bill from CBC for $500,000. There was the Premiers' Conference and the Economic Summit. There has been no concern whatsoever for taxpayers' dollars. Yet the Minister of Finance had the gall to go on national television last night and say that Canadians would be pleased. He said that individual families who earn $20,000 or $30,000 a year would be pleased to pay an extra dollar a day in order to get the finances of the Government under control.
Where is the minimum tax when it comes to fairness? It is another lob hit by the Minister of Finance. He is a tennis player and he hits another lob on this one. That minimum tax would have gone a long way toward suggesting to ordinary men and women of this country that the Government means business, but there is no minimum tax. Instead, there is a study, further consultation, a series of options, and we are told the tax will be introduced miraculously in 1986. But no model for that tax has been decided upon. I am sure, Mr. Speaker, you would join with me, if you could, and say that you will believe that tax when you see it.
In terms of expenditure, I must say that when we started to read about the expenditures of this Government on themselves, I really thought the sky was the limit. Now we learn, particularly when we watch the Minister of Communications (Mr. Masse), that not even the sky is the limit. In fact, all the skies
The Budget-Mr. Riis
of the world are open to the travelling Ministers of this Government.

It is unbelievable. When he was in Quebec City he was described as the "national air draft"-quite properly so. To him, that is just a few cents. He spent $57,000 to fly to Greece or wherever, and now the Minister of Finance is telling us that each Canadian family with an income of $20,000 to $30,000 ought to be proud to contribute $1 a day to control the finances of the federal Government. Unbelievable, Mr. Speaker, unbelievable!

We will be hearing much, Mr. Speaker, from Hon. Members on this side of the House with respect to the Budget and, believe me, there is much to be said. I want simply to conclude by telling the Minister of Finance, who unfortunately has left the House-and I should say in fairness to him that he told me he would have to leave the House at 12.40 p.m.-that there is one major difference between the Minister's namesake, Hack Wilson, and himself, that is that at least Hack Wilson hit a lot of home runs.


John Napier Turner: This guy struck out. [Translation]


Donald James Johnston: That being said, I move the following amendment, seconded by Mr. Turner (Vancouver Quadra):
That the motion be amended by deleting all the words after the word "That" and substituting the following therefor: This House condemns the Government for its betrayal of the trust of the Canadian people by producing a budget that destroys jobs, that offers neither help nor hope to the working poor and the unemployed, that brutalizes the middle class, that imposes massive and unfair tax increases on middle and lower-income Canadians and that is devastating to the economically disadvantaged regions of the country.


Mr. Speaker:: The House has heard the terms of the amendment moved by the Hon. Member for Saint-Henri-Westmount (Mr. Johnston).


Ian Deans: Mr. Speaker, I rise on a point of order. I have had discussions on this matter with the Government House Leader and the House Leader for the Official Opposition. I would like to seek unanimous consent of the House to allow my colleague, the Hon. Member for Kamloops-Shuswap (Mr. Riis), who will be speaking next on behalf of our Party in this debate, the courtesy of having the normal time available to a third Party speaker extended to a time not exceeding that taken by the critic for the Official Opposition and, at the very least, not exceeding 40 minutes.


Mr. Speaker:: I am sure there is unanimous consent.


Some Hon. Members:: Agreed.


Nelson Andrew Riis: Mr. Speaker, first, I would like to thank my colleagues in the House for the courtesy extended to me of an opportunity to speak perhaps a

May 24, 1985
The Budget-Mr. Riis
little bit beyond the 20-minute time limit, but certainly within the time limits followed by the previous speaker.
We have now waited as anxious parliamentarians for the last eight months, along with the people of Canada, for this budget presentation. It is the longest period of time in recent history that a Government has waited before it introduced a major Budget. The Prime Minister (Mr. Mulroney) and the Minister of Finance prided themselves on having gone about the country and talked with groups in all regions, having spoken with organized groups such as the Canadian Chamber of Commerce, and having listened to groups of individuals who were assembled at various conferences. But what has become very clear, Mr. Speaker, is that the Minister of Finance and the Prime Minister seemed to have listened to a very select group when it came time to write out and introduce the Budget which we heard last night. I believe that when the dust settles over this whole matter, the columnists have had a chance to evaluate the situation and the true nature of the Budget is presented, what will become clear is that the boy from Baie Comeau has backed his Bay Street buddies all the way to the bank. Very clearly there was a bias in this particular Budget which went against the interests of ordinary Canadians and was very much in favour of a select group of Canadian society. That was perhaps reflected in the advice of the policy adviser brought in by the Minister of Finance for the Budget, the Vice-President of the Bank of Nova Scotia, who advised him on the approaches which the Minister ought to use and, indeed, this was a banker's Budget in many respects.
The Prime Minister and the Minister of Finance said that this was a tough Budget but a fair one. I suspect that the more appropriate wording would be that this was a very fair Budget for a very few number of Canadians and a very tough Budget for very many Canadians. What the privileged few in Canada received in this Budget was, of course, no introduction of the minimum tax which the Prime Minister promised Canadians would be introduced in this Budget. Those thousands of Canadians, whom we will call wealthy Canadians-the upper-income earners whose incomes are often in excess of $500,000-will again this year pay no income tax whatsoever as a result of the multitude of loopholes available to them in their financial arrangements.
There is another group of Canadians. We recognize that about 4 per cent of the Canadian population buy and sell stocks in the stock market, and a few more, perhaps, are interested in the matter of capital gains. The Government, through this Budget, has now introduced a capital gains holiday for those folks on the first $500,000 of income. That handful of Canadians who obtain their income from investments have now received a real bonus in this Budget and a lot of champagne will be consumed on the Bay Streets and in downtown Montreal, Calgary and Vancouver, as the senior executive levels celebrate just what this corporate giveaway means to them personally.
We think of the laid-off workers of the White Farm plant, the people who work at the heavy water plant in Cape Breton, the laid-off miners in the Highmont Mine in British Columbia
and the people who work at the Burns plant in Kitchener, and we wonder how excited they are today about the fact that they can escape capital gains tax on the first $500,000 of income earned through their investments.


John Edward Broadbent: They are lucky if they earn that in their lifetime.


Nelson Andrew Riis: As my hon. leader indicates, they are lucky to earn that during their entire lifetime.
So let us recognize that for the privileged few this Budget is excellent news. There will be lots of champagne being drunk over the next few days as people celebrate this Budget.
On the other hand, for most Canadians, the average Canadian, what did the Budget have? Some extremely tough measures. When you examine the implications of the November 8 Economic Statement and add those to the provisions in this Budget, you find that the average family in Canada will be paying about $1,000 more in taxes. That means that $1,000 a family will be taken out of every single community across this country. In the Corner Brooks, the Moose Jaws, the Chicouti-mis and the Sudburys, thousands of communities across this country, $1,000 a family will be taken away and plunked down here in Ottawa for the federal Government. The Minister of Finance indicated there would be a fairness in this Budget. Is it fairness to ask every senior citizen in Canada receiving OAS to pay an extra $100 a year starting next year? This will add up to $255 million coming from the senior citizens of Canada to make up for the money the Government is going to lose in its capital gains giveaway. The seniors of this country are going to be paying for that capital gains holiday. The average Canadian family is going to be paying an extra $1,000 to make up for the give aways to the large oil companies.
To be very frank, Mr. Speaker, what this Budget means is that almost every single item in the average corner store in our communities will have a federal tax added to it. Kids' candy bars and pop, all the confectioneries in that store, shampoos and soap, the things families use every day, will all be taxed. Pet food will be taxed in an effort to raise money because somebody has to pay for these capital gains giveaways. I remember very distinctly that when the Western Accord was signed a few weeks ago the Minister of Energy, Mines and Resources (Miss Carney) said that they made this deal to help the western provinces particularly, but that the taxpayers of Canada are not going to pay for it. There will be no increase in gasoline taxes as a result, she said. What happened in western Canada was that the Minister of Energy, Mines and Resources sat down for dinner with the provincial Premiers and the heads of the oil companies, and we as Canadian citizens are going to be asked to cough up hundreds of millions of dollars to pay the tab.


Mr. Blaikie:: Expensive dinner.


Nelson Andrew Riis: Very expensive dinner, when you consider the 9 cents a gallon tax. What does that mean for people who travel
May 24, 1985

about the second largest country in the world? What does that mean for every product transported across this vast country? What does it mean for people who have to travel long distances to work, up into the forest, out into the mines, or commute long distances in metropolitan areas? This 9 cents a gallon tax will be felt right across this country, and at a time when we were hoping to see some disposable income invested at the local level to assist small business. But we are pulling hundreds of millions of dollars out of those communities and bringing them back here to Ottawa, and that will not help small business.
I think the most surprising thing in this Budget is that it totally ignored a group of Canadians. It failed to recognize the
1.475	million Canadians who are jobless today, including 500,000 young people. This is the International Year of Youth, a year when we should be paying special attention to young people. Surely in a country which is at all sensitive the Government should recognize that young people have a special role to play. At this time of year, on budget day, they are coming out of the colleges, universities, technical and vocational schools, and high schools, looking for summer employment or their first job, and what do they find in the Budget? I do not think the word "youth" was even mentioned in the Budget. The Minister spoke for an hour and a half and did not even mention the word; it is not part of his vocabulary. I do not think it is part of the Government's vocabulary. The words which are in the Government's vocabulary, of course, are words like "deficits"-


Mr. Nickerson:: Jobs.


Nelson Andrew Riis: -and "tough"-


Dave Nickerson: Jobs.


Nelson Andrew Riis: -and "sacrifices"-


Dave Nickerson: Jobs.


Nelson Andrew Riis: -and "capital gains", "corporate confidence", but the word "youth" is not mentioned. Was there any reference at all to the 600,000 women who are jobless? There was virtually not a word in the Budget which would assist those
1.475	million people presently out of work, not a word to give them any hope or encouragement, to indicate that things are going to change in the weeks and months ahead.
The Government has said that we need to have faith because the small business sector will have a whole set of reasons to expand its operations and create jobs. Whether it is in Corner Brook, Glace Bay, Bathurst, Lac-Saint-Jean, Timmins, Moose Jaw, High River, Prince George or Kelowna, small businesses will be going out and expanding in the weeks and months ahead. But let us look at the Minister's constituency. Let us look at a business in Etobicoke. Let us look at that small corner store again. All of a sudden, as a result of this Budget, that store finds that all of the families who use the store are going to have $1,000 removed from their pockets. They will not have a thousand dollars next year to buy goods from that store. In addition, everything in that store has increased in
The Budget-Mr. Riis
price as a result of additional federal taxes. Is that corner store going to want to run out and expand its operation?


John R. Rodriguez: Not likely.


Nelson Andrew Riis: This same scenario can be imagined across this country. When you take money out of every community in this country and reduce the purchasing power of Canadians, when you do not give any hope to those 1.5 million unemployed, including all those young people looking for work, are people going to go out and purchase goods and services? Are they going to go out and buy that new refrigerator, stove, car or set of clothes? No, they are not. The Government says it expects businesses to go out and expand their operations and hire new employees, but I think we are asking too much of the business community under these conditions. There has been no effort to create more demand for their products. There has been no effort to provide a reason for those businesses to go out and expand. Therefore, I really do not believe that the hope or expectation the Minister expressed today so many times will in fact be realized.
I am reminded of Peter Pan when I hear the Minister of Finance say time after time, "If we really believe, if we really believe, then we can fly. If we really believe businesses are going to create those jobs and they will run out and expand their operations, then they will". Well, surely we can have something better than a Tinker Bell approach to encouraging the business community of Canada to expand and create the necessary jobs.


Some Hon. Members:: Hear, hear!


Nelson Andrew Riis: Mr. Speaker, it is interesting to look at some aspects of the Budget which were not mentioned. Sometimes it is more appropriate to look at the Budget and take note of what he failed to mention at all. One of the key sectors of our economy is tourism. Right across the country, whether it is in the provinces or the Territories, a lot of Canadians feel this is one area where there is a considerable amount of growth potential. But is there anything in the Budget to assist the tourist sector? Yes, there is something that will affect the tourist sector; the increase in gasoline prices will make it that much more expensive for American travellers to travel around Canada in their Winnebagos and so on, or Canadians for that matter. Also, we are going to increase liquor prices, and that will have a rather profound negative effect on the hospitality industry.
I notice it is one o'clock, Mr. Speaker, and perhaps I could continue a little later today.


Mr. Speaker:: It being one o'clock, I do now leave the chair until two o'clock this day.
At 1 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
[Stage Direction]
May 24, 1985
The Budget-Mr. Riis
The Acting Speaker (Mr. Charest):: When the House rose at one o'clock the Hon. Member for Kamloops-Shuswap (Mr. Riis) had the floor. The Hon. Member for Kamloops-Shuswap.


Nelson Andrew Riis: Mr. Speaker, the Budget includes nearly six and a half pounds of paper. Yet there is nothing in this entire package for the unemployed in the country. There is not a single thing in the package for young people in Canada. We find it totally unacceptable that, with 70 per cent of our young people ouf of work today, there was not a single reference to them in the budget speech.
It is interesting to consider what is in the Budget. After looking at it very carefully it becomes perfectly clear that the Government believes that the most important resource in the country is the capital resource. The other day my friend, the Hon. Member for Mission-Port Moody (Mr. St. Germain), suggested that the most important resource is not the capital resource, but trees. We in this Party believe very strongly that the most important resources in the country are our human resources, our young people.


Some Hon. Members:: Hear, hear!


Nelson Andrew Riis: There is nothing in this six and a half pounds of budget material that is going to assist farmers in Canada. There is, however, something that will assist them to get out of the farming business. The capital gains exemptions will help them to get out of farming, but aside from that we find only agricultural cuts. The only assistance for the forest sector is that the federal tax on boom chains can now be deducted. The fisheries sector finds further cuts, the imposition of user fees, but no assistance. There is no assistance for the mining sector. Mr. Speaker, there is nothing in this Budget which will provide assistance to the hard-pressed resources sectors of the country.
I have already mentioned tourism. This was a wonderful gift for British Columbia. Mr. Bennett must be really happy as they are developing Expo '86 and attracting new tourists. Now the Government slaps on a gasoline tax and an additional liquor tax to make it more expensive for visitors to come into the country. That is not the way in which to encourage tourism. Yet that is the way in which the federal Government has assisted the province which is developing Expo '86.
Was there tax reform in the Budget? Was there an effort to impose that minimum tax on the rich as promised by the Prime Minister? There is no minimum tax in this Budget. The Government says it may study it and put it in the Budget next year. However, it did not stop to study the impact of imposing a tax of $1,000 on families. There was no hesitation in putting that in.
There was nothing done about the billions of dollars in corporate tax concessions used for mergers and takeovers that do not result in new jobs or product lines. There was no corporate tax expenditure included with the Budget to enable us to see the pros and cons of the various expenditure programs. There was no five year projection of the corporate taxes and what they mean for Canada as there is in American
Budgets. There was nothing in this Budget with regard to corporate or personal tax reform.
I am pleased to see that the Minister of Finance is now with us and listening to our speeches. He said that this is a new era and new approach. He said it is a chance to make over our country and refashion Canada. He said it is a new way of doing things.


Some Hon. Members:: Hear, hear!


Nelson Andrew Riis: He went on to say things like, "We mean to cut our costs and become more productive", and, "The private sector must be the main creator of jobs".


Some Hon. Members:: Hear, hear!


Nelson Andrew Riis: He said, "We look to the creative, innovative small business sector". He said, "This is a fiscally responsible Budget". He said that securing growth and jobs depends on our success in four basic areas; reducing and controlling inflation, increasing investment, reducing the Government's deficit, and improving our competitiveness.
Oh, I am sorry, Mr. Speaker, this was Marc Lalonde's Budget. I am sorry, I got the Budgets mixed up.


Some Hon. Members:: Hear, hear!


Rodney Edward Murphy: And the Tories clapped.


Nelson Andrew Riis: I want to thank my Conservative colleagues for their approval of those suggestions, but I was meaning to read from this Budget.
Is there a change or a new direction, Mr. Speaker? The Liberals increased taxes and gave more concessions to the corporations and we know what happened to the country. Nothing has changed from the Lalonde or MacEachen Budget. Nothing has changed. Only the actors have changed and the colour of the suits. The whole effort of the Government was to attack the deficit. This was the bogey-man that had to be slain. This was the dragon. Michael was out there with his sword hacking away at the deficit dragon. What was it that created the deficit, Mr. Speaker? It was the result of the Liberal monetary policy and mismanagement for years and years that resulted in a recession. The fact that it was costing us $1 billion a month in UIC alone was adding to the deficit. Something else has added to the deficit, the billions and billions of dollars in corporate loopholes for which we are getting very little, if anyting, in return. Those are billions of dollars and that is what created the deficit. The cast we were not collecting corporate tax, business tax, personal tax and sales tax because of the recession was another reason.
The New Democrats did their consulting as well. We did not talk with Bay Street and to stockbrokers. We spoke with main street and ordinary Canadians. We came up with something called "Canada Unlimited". We have 70 recommendations in this book on how to reduce the high levels of unemployment. That is what Canada Unlimited sets out to accomplish.
May 24, 1985

Time and time again what our proposals do is to set targets for inflation, to get inflation down. We set targets for research and development levels and we set targets for foreign aid. Why not set targets for unemployment to get unemployment down? Why not set that as a goal and implement strategies to accomplish it? Why not reform the tax system to provide more moneys for the communities of Canada to assist small businesses as opposed to having a tax policy that takes out a thousand dollars a household from every community in Canada and focuses it right back here in Ottawa? Why not give that money to the communities to develop proper job-creation and economic development schemes?
We propose a minimum tax in Canada Unlimited and a return to the pre-1982 tax rate days. The Minister of Finance (Mr. Wilson) will remember the time when that legislation was introduced and we heard it said, "This is for all the upper income earners of the country. We are going to reduce the amount of tax that you have to pay". If we introduced that old tax rate and a minimum tax, we would raise $1.2 billion. If we did that, we could avoid de-indexing of the tax exemptions, the old age security, and the family allowance.


The Acting Speaker (Mr. Charest):: Order, please.


Mr. Towers:: The Hon. Member knows better than that.


The Acting Speaker (Mr. Charest):: Order, please. Before the Hon. Member for Kamloops-Shuswap (Mr. Riis) continues I must advise him, and I am sure he knows, that it is not permitted to make demonstrations of the kind he is making.


Ian Deans: Don't be ridiculous. Of course it is.


Nelson Andrew Riis: If we followed our proposal for tax reform in Canada Unlimited, we could eliminate the federal tax reduction and avoid the elimination of the Registered Home Ownership Savings plan and we could avoid increases in taxes on children's candy, pop, pet food, and all of the confectionery found in our small corner stores. We could avoid taxes on almost everything we could find in the corner stores. We could avoid additional taxes on tobacco and liquor and we would still have $200 million left.
If we had introduced those two provisions only out of the 70 recommendations in Canada Unlimited we would save all of that unnecessary tax increase and still have $200 million which could be used on direct job creation.


Some Hon. Members:: Hear, hear!


Nelson Andrew Riis: This was a Budget that asked Canadians to make a special sacrifice. It asked only certain Canadians to make a special sacrifice. Ordinary Canadians were asked to make an especially major sacrifice in the way of increased taxes and increased costs of transportation, which will be reflected in the cost of virtually every good transported across Canada. This Budget is especially punitive on the resource sectors of mining, fisheries, agriculture, tourism, and forestry.
Some people benefited, however. They are the ones who are in the upper income brackets. They are very happy as a result
The Budget-Mr. Riis
of this Budget because they can still use the loopholes of the tax system and pay not a single red cent of income tax. If that were not good enough, those people who obtain their income through investments and consequently take advantage of the capital gains provisions will get another holiday. They will not have to pay any tax at all on their capital gains until a half a million dollars has been accumulated. If we talk about the beneficiaries in this Budget, we are talking about a handful of Canadian citizens. The very wealthy in Canada will get much wealthier.


Thomas Gordon Towers: What about the farmers?


Nelson Andrew Riis: The Hon. Member says, "What about the farmers?" We have six and a half pounds of budget papers. There is nothing for the farmers in this bundle other than to encourage them to get out of farming.


Some Hon. Members:: Hear, hear!


Nelson Andrew Riis: Is there anything in the budget papers to help young people get into farming and into food production? Is there any assistance for those farmers who are hard pressed financially in terms of a heavy debt equity ratio? Are there any agri-bonds in these papers to assist those hard-pressed farmers? No, there is nothing. Is there any clarification of Section 31 of the Income Tax Act? No, there is nothing.


Mr. Gurbin:: What about the small business bond?


Nelson Andrew Riis: There is a small business bond. But show me a farmer who has been able to get a small business bond. Show me a single farmer who has been able to get one. That is the only bloody provision Mr. Speaker, to assist a farmer, but he cannot get one.
When you ask what is in the Budget for farmers, I say there is nothing, Sir. I can repeat those same comments for the fishermen, the miners, the loggers, the millworkers, and for the ordinary Canadians.
As a result, I am pleased to move on behalf of my Party, seconded by the Hon. Member for Churchill (Mr. Murphy):
That the amendment be amended by changing the period at the end of the last sentence to a comma, and by adding immediately thereafter the following words: "And this House further condemns the Government for actions which will effectively reduce pensions for senior citizens, for gasoline tax increases to pay for the Western Accord, for its failure to take immediate and determined action to reduce the ranks of the unemployed, and for the absence of a minimum tax on wealthy Canadians who pay no income tax."


The Acting Speaker (Mr. Charest):: Having read the subamendment, I find it in order.


Mr. St. Germain:: Mr. Speaker, I have a straightforward and sincere question for the Hon. Member for Kamloops-Shuswap (Mr. Riis). In that we are both federal politicians and we both come from British Columbia, I would like the Hon. Member's comment on a question relating to forestry. We have arrived at an agreement with the Province of British Columbia, an agreement which was never reached before,

May 24, 1985
The Budget-Mr. Riis
regarding $300 million in reforestation and silviculture. It is part of the over-all commitment on the part of the Government to work in the forestry area. Does the Hon. Member not agree that this is a significant starting point in forestry, or is he completely against the program? He said that we have not done anything for forestry. In view of the fact that we made such a commitment and started such a productive program for forestry, does he concur with it, or is he totally against anything for forestry which we brought forward?


Nelson Andrew Riis: Mr. Speaker, I realize that normally the first speakers for each Party do not have an opportunity to respond to questions. I am pleased that the Speaker changed the rules for today to make this possible, and I welcome the questions of the Hon. Member.
He referred to the fact that I said that in the 6.5 pounds of budget material there was nothing for forestry-and I stand by that-with the exception of the removal of the federal tax on boom chains. There is nothing in the 6.5 pounds of budget material for the forestry industry.
The Hon. Member for Mission-Port Moody (Mr. St. Germain) talked about the $300 million federal-provincial agreement to assist the forest sector. I remind him of the words of Les Reed, who used to be Deputy Minister of Forestry in Ottawa and is presently occupying the senior chair of forestry at the University of British Columbia, Department of Forestry. He made the observation that this $300 million was to be spent over five years and that to do the job necessary we needed $300 million this year and every year thereafter.
We should recognize that out of every dollar collected by the federal Government from the forest industry, it returns only five cents, a measly nickel. Yes, I suppose on the logn journey to the moon, one step is a step in the right direction.


Mr. Friesen:: Mr. Speaker, a couple of years ago the New Democratic Party had a task force to encourage involvement in the small business sector. I think that was laudable. Last night, Mr. John Bulloch, who represents that sector which the NDP wants to see flourish, said that the Budget would create a minimum of 400,000 jobs and maybe more. Yet the Hon. Member for Kamloops-Shuswap (Mr. Riis) seems to imply that there is no job creation in the Budget. At the end of his speech he spoke about direct job creation. Would he define how he uses the term "direct job creation"? Does he agree with Mr. John Bulloch that the Budget could create a minimum of 400,000 jobs or more?


Nelson Andrew Riis: Mr. Speaker, if I recall from the budget documents-and I believe it was in The fiscal Plan-the term outlines the projected levels of unemployment in Canada. By his own admission, the figures of the Minister of Finance indicate that they will be in excess of 10 per cent for the rest of this decade. Beyond that it is anyone's guess. In dealing with unemployment, the Budget indicates that we will not deal with unemployment and that we will be doing other things because the Government's projection is that it will stay about the same.
I also remember what the two previous Ministers of Finance
projected unemployment to be, and of course the figure was much higher. When one starts to project into the future and depends totally on the whims of the market-place, it is made very difficult. By the Minister's own admission unemployment will not be improved.
When I heard John Bulloch the other day, I suspected that John was drinking a lot of his own bath water. I do not think John has visited many parts of Canada. I know the Prime Minister has not visited British Columbia since assuming office. If the Prime Minister had visited British Columbia, the Hon. Member's constituency and mine, he would know that we cannot stand idly by now and wish that jobs will be created and that small business will expand. That may apply to some parts of central Canada, but in the eartern, northern and western parts of the country we cannot ask the small business sector to expand and at the same time reach out and take $1,000 away from every family and $100 away from every senior citizen in every community, to be paid back to Ottawa, through the de-indexing process. In that event small businesses will not have a market for their goods and services.
The point we have been trying to make is that we do not have to bribe small businesses to expand through tax concessions. They will expand on their own if there is a market for their goods and services. However, in parts of Canada today the market is not there. To take millions and millions of dollars out of the communities of Canada and to ask small business to expand on their own without any market is asking small business to do too much. It is very unfair to expect them to respond to that challenge.


Benno Friesen: Mr. Speaker, when the Hon. Member began answering the questions of the Hon. Member for Mission-Port Moody (Mr. St. Germain), he said that he welcomed the opportunity to answer questions. Now would he answer mine?


Some Hon. Members:: He did.


Mr. Duguay:: Mr. Speaker, for years and years I have heard C_nadians talk about dealing with unemployment and 1 have watched with some patience the strategies that were put forward. Each time they related to stimulating the consumer, a concept which I now recognize as one aimed at creating jobs. Some of the jobs created by spending more money were the kinds where very bright young people were hired to travel around the City of Winnipeg to erect signs advertising that the project was sponsored by this Minister or that Minister. I am proud to have listened to the Budget yesterday and to have learned that the Government will no longer accept the concept that the way to create jobs is to spend money and that that stimulates the consumer.
Canadians are able to create jobs. They told us repeatedly that they wanted to stand on their own two feet. They can do so, and the Budget gives them that opportunity. 1 wish the Opposition would show as much confidence in Canadians as I think Canadians are prepared to show in themselves.


Nelson Andrew Riis: Mr. Speaker, I appreciate any chance to respond to the Hon. Member's question or observation. I come from
May 24, 1985

British Columbia which has had a Conservative Government in power for some time. It had a similar approach to creating jobs in that province in terms of raising taxes and cutting back on a whole variety of government areas. I remember the advice of Michael Walker, the chief economist of the Fraser Institute. When asked in British Columbia what advice as a very wise economist he would have for young people looking for work in that province, he used a take-off on the old adage that one should go west, young man, to seek one's future, and said: "Go east, young man. Leave British Columbia and go to Manitoba because it has a different approach".
Manitoba happens to have the lowest level of unemployment in Canada. Manitoba has taken action to provide job opportunities. It has challenged the assumption that it makes sense to give young people and others UIC and welfare, to ask them to remain at home and watch television, to tell them not to provide a useful service for their communities. Manitoba had a different approach. It took the amount of money it would have spent on social services, UIC and welfare, and provided young persons with meaningful jobs so that they could serve their communities, assist senior citizens, assist single parents, provide support for daycare, playgrounds and so on. Thousands and thousands of young people in that province were mobilized and have done just that.
I come from British Columbia where that did not take place. I come from British Columbia where the Conservative Government there used a similar approach to the one in the 6.5 pounds of paper delivered last night. I know what it did for British Columbia, and I only hope and pray that the same thing will not be duplicated across the country.


Léo Duguay: Mr. Speaker, I will promise not to try and be an expert on British Columbia if the Hon. Member opposite will try not to be an expert on my province. I can state clearly that when you talk about Manitoba having the lowest level of unemployment, it is actually the second lowest. It has been the same for some time through both a Progressive Conservative and a New Democratic Party Government in Manitoba. It reflects on the people of my province, and not on the Government. If the Hon. Member is going to suggest that British Columbians were told to go east and go to Manitoba-


The Acting Speaker (Mr. Charest):: I'm sorry, but the period for questions and comments is now over. Resuming debate.


Barbara Jean McDougall: Mr. Speaker, this morning the Hon. Member for Saint-Henri-Westmount (Mr. Johnston) talked about important principles. He spoke about principles that have not worked. That is why this Government has asked Canadians to follow a new road. We have made a conscious effort to break away from the tired, cynical and unsuccessful attempts of the former Government to create jobs and build a future for this country. Instead, we have forged a fresh approach in job creation, in economic prosperity and in social responsibility.
The Budget-Mrs. McDougall
The Hon. Member went on to say that Budgets are to serve people. He is absolutely right. Whay did their Budgets never serve the people? Our Budget will. It will build on the vitality and dynamism of individual Canadians and of our businesses and our industry. It is a Budget that rewards initiative. It is a Budget that reafffirms our Government's basic belief in the ability of Canadians to create the growth that in turn creates the jobs we all want and need. It is a Budget that provides Canadians with the opportunity to show their stuff, to take action and to participate in a new direction for Canada.
This has been called, in a cynical way, a Budget of faith. It is a Budget of faith because I have faith in my neighbours and in your neighbours, because I know that they will help us build the jobs that we have committed for Canada.


Some Hon. Members:: Hear, hear!


Barbara Jean McDougall: During the election, we told Canadians that we knew there was an absolute need for change to responsible fiscal management of the Government's affairs. Canadians agreed with us. We have proven that time and time again in the last eight months. We have consistently demonstrated that our policies are a break from the past. We have taken actions to reduce government overhead, streamline the programs that restrain growth, rationalize programs and eliminate waste. We talked with Canadians across the country and listened to them. Because of that, we were able to formulate our proposals with the concerns of Canadians in mind and with their ideas guiding us. We were able to benefit from views in all regions and from all sectors. In short, we were able to take advantage of perspectives from every segment of Canadian life.
I want to reiterate what the Minister of Finance (Mr. Wilson) told this House. This Budget is about jobs. It is about providing Canadians with lasting employment, with programs that are sensitive and flexible. Our actions as a Government two months after having taken office have helped create over 200,000 jobs. Despite all the doomsayers over there who said we would lose 50,000 or 100,000 jobs, we now have 200,000 jobs in this country that we did not have before.
Hon. Members know that this is a significant achievement. We know that we can do better. That is why the measures in this Budget address unemployment and the creation of employment. The Canadian people have discovered what seems to be so difficult for the opposition Parties to understand. Canadians have discovered to their pain that government spending does not create jobs, that government spending creates deficits. We have chosen not a single instrument of direct job creation. We do not believe that is responsible. By taking measures to create jobs through the capital gains tax exemption, through the training initiatives of my colleague, the Minister of Employment and Immigration (Miss MacDonald), of restoring fiscal order to our balance sheets, we can create a climate of job creation of which Canadians can take advantage.
I know that debate has been occurring, especially in the pre-Budget press, over the relationship between unemployment

May 24, 1985
5050_________________________________________
The Budget-Mrs. McDougall
and the deficit, that the old pump primers still want to spend our way to full employment. The Prime Minister (Mr. Mul-roney) put it more succinctly than I have ever heard it when he said several days ago "If increased deficits lowered the unemployment rate, we would have full employment this very day". The sad truth in human terms, in terms of dashed hopes of millions of Canadians, is that unemployment still remains unacceptable, despite a staggering deficit.
Clearly the Budget emphasizes fiscal responsibility, but it is not fiscal responsibility for its own sake. Such a philosophy has no place in the plans of our Government. No proposal was made, no program was changed or even considered for the sole purpose of deficit reduction. The issues at stake are too complex, too interwoven to be determined by any one narrow philosophy. The budget measures have been carefully selected and balanced to further the broad goal of economic renewal.
We are a young country, but we are carrying around a burden. That, quite frankly, is weighing us down beyond our years. It is a millstone around our neck. It is preventing the development that our economy needs. It ties the hands that create jobs and it trips the feet that are leading to the future.
There is concern for people in our deficit control action and in our efforts to restore responsibility. We have demonstrated this concern by facing the real problems that stand in the way of the better future we all desire. There is no room for wishful thinking in our policies. The Hon. Member for Kamloops-Shuswap (Mr. Riis) said that this is a Budget of wishful thinking. We do not wish things for small business, we give them the tools to make it happen. By bringing forward realistic effective policies, we are acting with respect for the wishes of Canadians now and with the aspirations of Canadians for today, tomorrow and the day after tomorrow.
[ Translation]
The budget is pervaded by the new spirit that has developed across this country. It is the spirit that has led our Government in its relations with the provinces, with the various sectors of our economy and with our trading partners. It is the spirit of co-operation and consultation.

Canadians know that we can each contribute in one way or another to a better Canada. That means that we must all shoulder a part of the burden. The results will take longer if we do not, and will be more difficult to obtain. The spirit is also independent. There is an enthusiasm growing across this land. I have recently been in British Columbia, Alberta, Saskatchewan and Manitoba. Yes, the people of this country have faith in us because we have faith in them.
This Budget shows that our Government's recognition of Canadians is important. We know that Canadians know best and that Government cannot decide what is best. We are saying to Canadians, "Invest, it is your future, your children's future", and we are saying, "The Government will help you make Canada strong and prosperous". We are cutting out the red tape that strangles initiative. We are making Government
simpler, easier, more effective for Canadians who need it and for those who are working with us in the goals we have set.
The budget proposals deal with a tough reality. The Hon. Member for Saint-Henri-Westmount talked about Tory times being tough times. If Tory times are tough times, it is because of the irresponsibility that has gone on for years and years before. We know we cannot give Canadians everything. We do not live in Never, Never Land. We have to act responsibly, to take control of ourselves, each of us in our own way.
I may remind the Hon. Member that we all agree that Canada must have the kind of government that will promote economic growth and stimulate development of the employment opportunities we need.
It is therefore a pleasure to be able to point to some of these programs and policies today.

At the Regina First Ministers' Conference, my colleague, the Minister of Employment and Immigration, announced a new program with an innovative approach to training and employment. This approach too is practical. It aims for career development, not just for short-term jobs. I want to emphasize that under this program, women for the first time will have access to all labour strategy programs, and one of those programs is specifically geared to women who are re-entering the workforce. Those who are most in the know, members of the local private sector, are deeply involved in this to ensure that the training meets the requirement of communities and the private sector. The Budget proposes an additional $900 million for those programs for 1986-87.
Changes proposed in the Budget assure Canadians that, for example, they will be able to enjoy the fruits of their labours. A lifetime capital gains exemption of up to half a million dollars provides significant recognition of the effort and initiative of individuals and frees up funds for investments in small and growing enterprises. This provision is not only for rich people. There is a cap on the capital gains tax exemption because it is for Canadians from all walks of life. The dry cleaner at the corner of my street at home has a modest, successful business and is ready to retire. He will be able to sell his business and keep the profits from the work he has done all his life without paying a capital gains tax.

The Budget proposals have also given full consideration to the innovative spirit of our labour organizations. A tax credit will be provided for individual investors in venture capital initiatives managed by labour organizations and which receive provincial tax assistance, such as the Solidarity Fund of the Quebec Federation of Labour.

We are all aware of the tremendous contribution played by our cultural sector in both creating jobs and preserving a vital
May 24, 1985

and rich heritage. I spoke with representatives of the Canadian Conference of the Arts this morning. They were enormously excited because, for the first time, a Finance Minister talked about the economic significance of the cultural sector and provided incentives for that sector which provides so much to our heritage and to making our country a civilized place to live. I am especially pleased by the establishment of a private sector committee in collaboration with my colleague, the Minister of Communications (Mr. Masse), to propose ways in which the private sector can be encouraged to increase its support for the arts.
Let us be realistic. In all sectors there is a limit to the public purse. Similarly, the proposals for pension fund investment and the RRSP changes reflect our faith in the ability of Canadians to make their own investment decisions. The pension plan proposals will encourage and strengthen private pension arrangements, will broaden the base and will give many Canadians a fair and more flexible opportunity to save for an adequate pension. Amendments to the Pension Benefits Standard Act will go forward to establish minimum standards for federally regulated pension plans. Once passed, these changes will improve the pension rights of all Canadians, and particularly those of women who make up the bulk of our part-time workforce. It will help workers who are thinking of early retirement, women in the workforce, spouses of pension plan members, and all employees. There will be improved survivor benefit regulations for women, standards for pension benefit splitting on marriage breakdown, and equality standards.
The Government believes that it must manage its own costs more effectively. The November statement initiated that process and further savings are planned in this Budget arising from additional measures to introduce more businesslike practices in the federal Government, including the sale of Crown corporations and additional cuts to government programs. In this important area, our approach has been careful, balanced and systematic. We tabled with the Budget, on behalf of the Deputy Prime Minister (Mr. Nielsen), the first report of the ministerial task force on program review. It sets out the decisions our Government has taken in this important area of government responsibility.
I am very proud to stand here today to participate in this debate with my hon. colleague, the Minister of Finance. I want to remind all Canadians of the words of that great Nova Scotian, Joseph Howe:
You are the representatives of the people and I put it to you as you are greatly honoured, should you not greatly dare?
The Budget that was placed before us yesterday by my colleague and friend, the Minister of Finance, does just that. It challenges us and dares us to take a message of hope to the people of Canada. What better place to begin that challenge than here at the heart of Canadian democracy?
Hon. Members opposite, in their quiet and reflective moments, share the Government's concern about the situation which we inherited on September 4. The Hon. Member for Saint-Henri-Westmount knows that this is true. He spoke
The Budget-Mrs. McDougall
eloquently today and I listened with interest as he spoke because I recall his words last year when he said:
Anyone who tells you, you don't have to face up to those hard choices (in spending cuts) would be better off as a tour guide in Disneyland. Any major new government programs can only come at the expense of existing ones. We must not mortgage our children's future by going deeper and deeper into debt.
The Hon. Member was right. The Government has taken that responsibility seriously. It has taken its responsibility seriously not only to care for those who need our help in today's world but enable our children and those who follow us to hope, to plan, and yes, to dare. I recall what the Leader of the Opposition (Mr. Turner) said to a high school student last year. He said, "Your generation is going to be strangled if Ottawa continues to go into debt at the current pace". He too was correct.
We sense the frustration in Canada but we are a Party of optimists. We believe in the future and we believe in tomorrow. We believe we can embrace tomorrow only if we act with responsibility today. We are the trustees of tomorrow and we are determined not to let tomorrow's greatness escape our beneficiaries.
I look to my friends opposite, and they are my friends because I have established a great deal of respect for them, and I ask them, where is their logic, their sense of responsibility? The NDP's own policy advisers have told them that they have been left with an economic analysis of little value and an economic program that is a hodgepodge of contradictions and dead-end solutions. With all due respect I say to Hon. Members, wake up and smell the coffee. Even their colleagues are uncertain about their formula.
I remember how heartened 1 was to hear the Hon. Member for Essex-Windsor (Mr. Langdon) earlier this spring state on national television as he looked straight into the camera, "We can't simply accept that we have large deficits continuing ... it does not make sense". Hear, hear, I thought. Finally there has been a conversion of this Party like the one on the road to Damascus. However, after hearing once again the same tired cliches emanating from the Hon. Member for Kamloops-Shus-wap, I can see that that was a conversion for the cameras only.
Thus I wish to conclude by asking Hon. Members to take into account Mr. Howe's question in addressing this Budget: should we not greatly dare?
[ Translation]
And why should we not?


Mr. Benjamin:: Mr. Speaker, does the Minister believe that having corporation taxes go down by half a billion dollars and individual taxes going up by $1 billion next year is fair? As well, does she consider it fair that those who were legally able to avoid paying any income tax last year will not pay a minimum tax this year and that the surcharge has no effect on them whatsoever? Does she believe those two things to be fair?

May 24, 1985
The Budget-Mrs. McDougall


Barbara Jean McDougall: Mr. Speaker, in the Budget we indicated that we recognize that corporation taxes need a thorough review. We have published a paper on how choices can be made to reform corporation taxes. In addition, we have placed a tax on financial institutions. Also, we have eliminated some of the loopholes to which the Hon. Member referred, such as using hotels under certain circumstances. Some other loopholes have been removed, such as the scientific research tax credit. We have moved to ensure that the system will become fair. We will continue to do that. It is a continuing program. It is not something which will stop today, it will go on. We will be looking at the whole taxation system through corporation taxes. We know that there are still changes to be made and we will be making them. Some were made in November and some are being made now.
What the Hon. Member is forgetting is that the people of Canada who will benefit from some of the things which we have done will not be the rich and wealthy Canadians. Those who will benefit will be small-businessmen and farmers. Has he forgotten about the farmers? They are the ones who will benefit the most from some of the things which we have done. It will be easier for them to pass on their farms to the next generation.
It is a fair Budget. Fair means that Canadians can look us in the eye, as they have been doing today. We have been flooded with telephone calls and letters from the people of Canada who are saying that they agree with the Budget and that they know we are on the right track.


Mr. Foster:: Mr. Speaker, I would like to direct a couple of questions to the Minister of State for Finance (Mrs. McDougall). In January, the Department of Finance published a paper entitled Tax Issues in Agriculture. That paper indicated that farmers earn twice as much as the average Canadian and that they only pay a quarter of the taxes which ordinary Canadians pay. It also indicated that farmers were approximately eight times better off than the average Canadian. The response to that paper from the agricultural community was swift and predictable. It absolutely slaughtered the Minister of Finance (Mr. Wilson) on his view of the world and on his view of the Canadian farming scene. It is little wonder!
On October 30, 1984, the Farm Credit Corporation published a paper which indicated that 17 per cent of Canadian farmers were in serious financial difficulty. That paper was referred to the Standing Committee on Finance, Trade and Economic Affairs. A few weeks later, the committee released a report which completely rejected the position of the Minister of Finance. If anything, the farm debt crisis in Canada has deepened. A report from an agriculture committee in Bruce County indicated that it was not 17 per cent, but that 30 per cent of the farmers were in serious financial difficulty in countries such as Bruce and Grey.
The report of the standing committee, which had a majority of Tory Members, recommended an emergency program of agri-bonds which would address the serious financial difficulties which some 39,000 farmers face in Canada. That recommendation provided for long-term, low interest agri-bonds at 8 per cent for a five-year period, up to a maximum of $300,000.
The Minister spoke about what the Budget would do for farmers. Certainly, it does not address the serious financial difficulties of the 39,000 farmers who are facing foreclosure or bankruptcy this year. If there is any urgency in the agricultural community, it is that urgency. The Budget, as far as I can see, does not address the situation. I am wondering why the Government did not adopt the recommendation of the standing committee which would have dealt with the serious financial difficulties which face 39,000 farmers. It would have provided long-term, low interest rate loans from the Farm Credit Corporation with a view to saving the farms of those producers who are the most productive. Those producers are the youngest and produce one-half of the produce in Canada. Why did the Budget not deal with that matter? Why did the Government not accept the report of the Standing Committee of Finance, Trade and Economic Affairs?


Barbara Jean McDougall: Mr. Speaker, the Conservative Party is well aware and very sensitive to the problems which face farmers in Canada, particularly those farmers who are struggling to hang on to their farms and those who have faced the most difficulty. We do have policies for those farmers. However, it is not part of the budgetary process; it is part of a review which is now before the Minister of Finance. He recognizes the sensitivity in the area and he knows, as we all do, that this segment is very important to Canada. Therefore, he will review the policies with respect to farmers.
Some farmers will benefit from proposals concerning the red meat stabilization plan. Other farmers will benefit from the expansion of the small business bond. Sixty per cent of small business bonds go to the agricultural community.
We know farmers are facing problems and we are reviewing those problems. We will be coming forward with policies for farmers. Some of the policies which help the farmers of Canada are in the Budget.


Mr. Desrosiers:: Mr. Speaker, I would like to ask the Minister to tell all Canadians today who is responsible for the situation in which the Canadian Government now finds itself. I think it is important because for hours on end we are going to be listening to the great Liberal tenors blaming us for everything under the sun, searching for every kind of discrepancy, and posing as the self-appointed defenders of the poor, the underprivileged, the elderly. They ought to hang their heads in shame, and I would like the Minister to set the record straight today and tell all Canadians who are listening who in fact is responsible for the present situation in Canada.


Jean-Robert Gauthier: The Conservatives, my friend! You have brought forth a Budget which falls far short of the mark.
May 24, 1985


Barbara Jean McDougall: Mr. Speaker, yes, we all know who is responsible for the situation in which elderly Canadians find themselves today. Pension reform was studied for 10 years and we were able to make good use of what was accomplished by the Hon. Member for Sudbury (Mr. Frith) when he was involved with pensions. We thank him for that. It is too had that after all that time the situation had to wait for us to take action.


Aideen Nicholson: Mr. Speaker, it is still less than 24 hours since the unveiling of the Conservative Budget. With the exception of Investment Canada, it is the first piece of legislation which came directly from this Government. It gives us a clear statement of its policy and its view of Canada.
We have already heard an overwhelming amount of critical comment on the budget proposals which strike directly at low and middle-income families. The reaction is real and it is justified. Ordinary taxpayers are the target of the Government's efforts to raise revenue. For many months we heard the Prime Minister (Mr. Mulroney) talk about a mythical bank president, or a mother who was receiving family benefits which she did not really need. But it seems that if the Government has aimed at the bank president in this budget, it has shot the teller.
Lower-income Canadians will be paying dearly. A two-parent family with two children and one income totalling $20,000 will be paying upwards of $350 extra in taxes, and that figure does not include the losses from de-indexation of family tax benefits and tax deductions.
Low and middle-income earners will be paying but what are they being offered by the Government? Will all these tax increases and discriminatory measures produce more jobs for our 1.4 million unemployed? The budget does not say so. In this budget, the Government is forcing the average Canadian to pay, and to accept in return a vague promise of better times to come. I say a "vague promise" because the budget has no agenda for economic growth and no projections for growth beyond next year.
I understand that the Department of Finance has prepared forecasts for five years and further but they were not used. In the budget document on Canada's Economic Prospects for 1985-1990, most tables stop at 1986. We are not told what the Government expects the eventual impact of its budget proposals to be. Impact statements have been asked for and have been refused. We are simply told to shoulder this extra tax burden and soldier on.
Canadians are overwhelmingly concerned about unemployment and the Government has not adequately addressed that concern in this budget. Without an agenda for economic growth, who can guarantee any improvement in the unemplo-ment situation? Again, in the Minister's own budget papers, he shows GNP for 1985 at 3.1 as compared to 4.7 in 1984. It shows GNP in 1986 at 2.4. In other words, the Minister's own
The Budget-Miss Nicholson
figures are showing a loss of economic growth. The same table shows unemployment figures of 11.1 in 1984 and 10.3 in 1986.
There is a further statement which adds to our confusion. It says that in 1985, consumption is expected to be an important source of growth. Yet we have measures here which are going to reduce the purchasing power of Canadians. The Government shows a 10.3 per cent unemployment level in 1986, which is still unacceptably high. Are we to take it that the Government is satisfied with the 10 per cent unemployment rate? Is that what Canadians have to look forward to as a result of this anti-family, anti-consumer budget?
When I questioned the Minister of Finance (Mr. Wilson) earlier today on these matters, he said that numbers are not the be-all and end-all of budgets. It is interesting to note that he was somewhat reluctant to discuss the figures from his own Department. However, in a way, the Minister is correct. Budgets are less about numbers of more about people because it is the ordinary working, middle and low-income people who pay taxes, who buy things and who keep the economy going. But here we have a budget which is going to take billions of dollars of purchasing power out of the economy. At the same time we are asked to accept the promise that the unemployment rate will be reduced. Yet we know that even to stay where we are in terms of our present unacceptable 11 per cent rate of unemployment, we need economic growth of 3 per cent. The Government is projecting a loss of economic growth. It is also projecting a slight drop in unemployment. That does not make sense, Mr. Speaker.
Let us leave the numbers for a moment and consider expectations. What might Canadians have expected to see in this budget given the promises of the Government? First, let us consider fairness. The budget amounts to a series of tax breaks for big business and tax grabs from middle and low-income families. Is that to be considered a definition of fairness? The sales tax is not only increased but the number of items which are subject to sales tax is greatly enlarged and includes such necessities of life as soap and medical supplies. This is going to be particularly hard on families with young children and low incomes.
The Government promised a minimum tax on the wealthy. This is not delivered. We have another discussion paper. The temporary surtax is certainly not to be confused with the minimum tax on the wealthy because the temporary surtax applies only to people with taxable income. If, indeed, one has a clever accountant who can guarantee that one has no taxable income, then ovbiously the surtax does not apply. So the minimum tax on the wealthy is another promise which was not kept.
With respect to pensions for home makers, I might just mention that the Government's pension proposals, as far as they go and in so far as they are laudable, are a rehash of reforms introduced by the previous Liberal Government. But this Government did not follow through with the Liberal proposal to provide protection from inflation in private pension benefits, and the Government did not come through with any proposals on pensions for homemakers even though the Prime

May 24, 1985
The Budget-Miss Nicholson
Minister campaigned on a promise to institute home maker's pensions.
With respect to maintaining universal social programs, I must say we have come a very long way since universality was regarded as a sacred trust. Before Christmas there were threats that all social programs were up for review and might be rearranged. This Party led the criticism and, indeed, Canada's citizens protested loud and hard. So the Government backed off and watered down its consultation paper. This is the same Government which, when in opposition, howled in outrage when old age benefits were capped at 6 and 5 per cent, even though the resultant drop in inflation meant that the pensioners lost only $2.17 while the caps were in place. My colleague, the Hon. Member for Ottawa-Vanier (Mr. Gauthier), and those others of us who were here, will certainly remember the howls of outrage because capping was occurring at six and five, but what we now see essentially is de-indexed pensions and family allowances.
This Budget is mean spirited and puts pensioners and families in the undignified position of being participants in a pension and family allowance lottery. If inflation is hovering at, say, 2.9 per cent, they will just have to hope that inflation nudges over 3 per cent so that their benefits will be indexed and they will have a better chance of making ends meet. What does that say about the attitude of the Government toward its retired labour force and those who are raising a future labour force?
While we are exploring attitudes, let us look at the $500,000 capital gains deduction. In introducing that change the Minister made it sound very reasonable. He spoke of the retiring farmer, and I think we would all sympathize with the idea that someone who is retiring, having worked hard on the farm or in a small business, might indeed get a break on capital gains and be able to plan to invest sensibly for retirement after a long life of hard and productive work. But we look again at the Budget papers and nothing limits the application of this exemption in any way. It could be applied to someone who has fine arts, jewellery bought in Switzerland, or a condominium in the Caribbean. There is no way that this is particularly aimed at the productive members of the Canadian economy. It can be used by someone who has no intention of contributing to the Canadian economy. This is really a slap in the face for the majority of Canadians who are doing what they can in these difficult times and who are now being asked to bear the brunt of the Government's tax increases.
Let us look at what is happening with energy. We find a tax levied which is being described as 2 cents a litre. In fact, if one adds in some other things resulting from the Western Accord,
1 think it is more likely to be 2.8 cents per litre. The Government's own figures in the Budget papers concerning the anticipated revenue from this gas hike just about matched the revenue it has lost by cancelling the PGRT. In other words, the multinationals get a gift and ordinary Canadians pay. I say "multinationals" advisedly, because those who benefited from
the PGRT were the multinationals who had old oil; the smaller Canadian companies with more recent exploration did not benefit. So the Government has chosen to help the multinationals and ask the ordinary Canadian to pay.
As well, paying for energy involves much more than paying at the gas pump or paying more to heat one's house. There is an energy cost in practically everything we use. Energy costs are included all through the food chain in things such as transportation, processing, packaging, storage and marketing. Therefore, as a result of this quite substantial hike in gasoline prices, we can certainly expect food prices to go up.
There are other elements in this Budget which are also inflationary and that have not been faced squarely either. I fully expect that during the coming days, as we plough our way through this six pounds of paper, we will find many more things to comment on. But the single important point I want to make is that this Budget has failed to address questions of economic growth. Without growth we will not have new jobs. There is in fact a great risk that this Government, which is so concerned about the deficit, may have put so many regressive measures in place here that they will choke recovery and we will end up with a higher deficit.
I would just like to comment on a statement by the Minister of Finance after he came to power. In December of 1984, when the Department of Finance, which had predicted growth of 3.8 per cent, revised its figures and projected economic growth to 1990 would decline to an annual average of 3.2 per cent per year, the Minister of Finance said this is not an acceptable outlook for Canadians. That was a very clear statement. Yet here we have in the Budget papers a projection of 2.4 per cent for 1986, which is even worse, but apparently the Minister now finds that acceptable. Had he found it unacceptable, then surely his Budget would have included measures to raise that growth rate substantially within the same time-frame.
What we are talking about, Mr. Speaker, is the definition of our economic problems and the clarity of thought underlying how they are dealt with. This is where one has to be worried about a fixation on the deficit. Of course the deficit is important, but it is one factor and a symptom, not a cause. I get very worried when I find the whole emphasis on the deficit and apparently not much concern about the $50 billion worth of goods and services we are not producing but could be, and the need to get this economy more vibrant and active. That I think is the real issue; how to get more economic growth, more jobs. That is the best way to get the deficit down and 1 do not think that has been touched by this Budget.


Mr. Rob Nicholson (Niagara Falls);: Mr. Speaker, I would first like to say how pleased I am to be taking part in this historic debate. I would like to thank as well as congratulate the Minister of Finance (Mr. Wilson) on behalf of the people of my riding of Niagara Falls for setting a clear direction for the economic recovery of this country. The Budget will be welcomed by individuals from my riding, and I believe that it will also be welcomed by all Canadians.
May 24, 1985

Many people have written to me from my riding, as well as from across the country. Most of them have said the same thing; they want the Government of Canada to continue with those themes that we talked about as candidates in the 1984 election campaign. They want us to be true to our word and do everything we can to encourage job creation. They know, and 1 think most Members of this House will agree whether they admit it or not, that job creation will only be possible in Canada when the Government of Canada puts its own economic house in order and frees up the entrepreneurial spirit in Canadians to create more jobs. I believe this Budget makes that theme very, very clear.
As the Hon. Minister of Finance said last night, it is a Budget which rewards success rather than subsidizing effort. It is a Budget which builds on the sense of co-operation which this Government has created among all levels of government and the private sector; co-operation which is so necessary to our economy. This Budget, once and for all, puts an end to the fallacy that the federal Government alone can create all the jobs necessary to cure our country's unemployment. It is true that, given co-operation among all the players in Canadian society, Canada will once again be healthy economically.
I believe the Budget introduced last night by the Minister of Finance will do three things to set the course for Canada's economic recovery. First, and finally, after years of Government overspending and misspending, we will control and ultimately reduce the national debt. Second, we will improve the effectiveness and management of all areas of the federal Government. Third, we will encourage private initiatives by increasing the availability of capital and start rewarding success. This is the mandate that I believe we were given on September 4.
In my opinion the staggering growth of the national deficit has for many years hindered real growth in our econony. We have recognized that the first step in long-term regeneration is the control of the national deficit. The Budget of yesterday afternoon and the November statement are the first significant steps in that direction in 15 years. I was, therefore, pleased when the Minister of Finance announced that the deficit for this fiscal year will be $4.4 billion less than it would have been had no action been taken. The deficit for this fiscal year will be $33.8 billion as opposed to $38.2 billion.
This process will continue in the fiscal year 1986-87. According to predictions the deficit will be $8.3 billion less, down to $32.7 billion, as opposed to $40.2 billion. Most significantly, the direct impact of all these efforts since the Government has taken office is to reduce the deficit in 1990 by $20 billion. 1 am sure that all Canadians congratulate the Minister of Finance for producing a medium-term strategy that will ensure that the national deficit will be $75 billion less by 1990 than if no action had been taken.


Some Hon. Members:: Hear, hear!
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Rob Nicholson: I believe that the necessity of reducing our national debt is recognized not only by those individuals who voted for the Progressive Conservative Party, but by the Members of the two Opposition Parties as well. All of us remember when early last spring the Leader of the Opposition (Mr. Turner) made just that point. He said that if he were elected Prime Minister of Canada he would reduce the structural debt in the country by 50 per cent over the course of seven years. He recognized what we are talking about in this Budget. As far back as 1982 the Leader of the New Democratic Party (Mr. Broadbent) as well made the same statement. He said that the national deficit was too high. To that extent 1 believe they agree that we are making the right moves.
The theme of deficit reduction has been a theme of the Progressive Conservative Party for some time. This subject came up very often during the recent federal election campaign. I made the point, and I know others agreed with me and made similar points, that the country would never again be healthy economically until the national deficit was reduced. If big deficits and uncontrolled spending could have solved the unemployment problem in Canada, every man, woman, and child in the country would have two jobs by now.
There will be those in the Opposition ranks who will disagree with our approach. They will say that efforts at reducing of the national deficit are unfair and unwise at this time. They will make essentially the same speeches they made last November after the presentation of the economic statement. The arguments I heard earlier this afternoon are the same ones I heard in Novemver. After the economic statement the NDP said that we will lose jobs. Other people said that interest rates and inflation will go up. In fact, since November we have seen the creation of 200,000 new jobs. Interest rates today are at their lowest level in a decade. Inflation has come down and investor confidence has risen. The record of predictions of those who will criticize the approach will be as good as it was last November. They were wrong in November and are wrong again in May.
As I mentioned earlier, in order for the Government to create new jobs in Canada it is necessary for the Government to put its own affairs in order. It must improve the effectiveness and management of Government, the Public Service, and its policy with respect to Crown corporations. I believe there is no clearer statement as to where the Government intends to go than that made last night on the subject of Crown corporations. This is consistent with what we said in the past election campaign. It is our belief that unless a Crown corporation fulfills a continuing public policy purpose it should be sold. Government must return to the private sector activities which properly belong there.
In November the Government announced its intentions to sell the assets of the Canada Development Investment Corporation, including its holdings in Canadair and de Havilland. It is estimated that the sale of these companies will reduce the cash requirement of the Government of Canada by approximately $675 million and the federal deficit by some $350 million in 1985-86.

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In addition, Mr. Speaker, corporations that no longer serve public purposes are being wound up. Legislation has already been introduced in Parliament to wind up the Canada Sports Pool Corporation, Loto Canada, and others. As well, five other corporations which are inactive, including Uranium Canada Limited and Mingan Associates, are being wound up.
The days when Government can afford to subsidize the mistakes of the past are over and that is a good thing for all of Canada. The business of Government is not business, it is to give direction to business. The Government will no longer pretend to be an entrepreneur. Decisions in this area are difficult, but they must be made. This is very true in the case of Cape Breton Island.
Although I was born in Niagara Falls and am very proud to represent the people of Niagara Falls, I continue to have hundreds of relatives on Cape Breton Island. When I visited there recently I overhead a discussion about the heavy water plants on Cape Breton Island. One individual made the point that these companies are costing the people of Canada approximately $100 million a year to keep 600 people employed. They are producing a product for which there is no longer a market. He said that he did not believe anyone had the courage to do what must be done, to day that enough is enough. He was proven wrong yesterday. The Government has the courage to say that the mistakes of the past cannot continue.
1 was pleased to hear that, in addition to making that tough decision, the Government will not abandon the people of Cape Breton. Workers at that plant will receive generous severance benefits and will be assisted in seeking new employment elsewhere. An enriched tax incentive for new investment is being introduced and all new investment in that part of the country will be free of corporate income tax for 10 years.
In addition to our policy of privatization of Crown corporations, the Budget sets out a number of additional internal measures that we are taking to increase the effectiveness with which taxpayers' money is spent. The Public Service pension plan will be put on a fully funded basis with no taxpayer subsidy. The guarantee of indexation of pensions of Members of Parliament and Senators will end January 1, 1986. An aggressive program is being put into place to improve the Government's management of its cash and to dispose of property that it no longer needs. Most significantly, the federal Public Service, which was expected to increase in size by 15,000 positions over the next six years, will in fact be decreased by 15,000 positions.
As a result of these measures and those taken in November the Government will save more than $2 billion this year. That figure will grow to over $3 billion by 1990. The Government will also encourage private initiative. The Government realizes that this country was built on the strength of the individual and the courage of the small business person. For too many years we have said that Government can do it all. This has been demonstrated many times to be wrong for our country. The Government should encourage investment and risk-taking and reward success.
In order to encourage more Canadians to invest in Canada's growth, the Government is proposing a lifetime capital gains exemption of $500,000 for individuals. This lifetime exemption will be phased in over five years beginning this year. The full $500,000 exemption will be available to farmers immediately in recognition of their special problems and their contributions to Canadian society. I take particular pleasure in that provision in the Budget. Many times the farmers in my area from Niagara-on-the-Lake and Virgil have made that exact point to me. They would like to acquire new farmland, pass their farms on or dispose of their lands as they saw fit without the burden of capital gains. I was particularly pleased to see that measure in the Budget.
I believe the initiative taken by the Government in this area of capital gains will encourage entrepreneurship and investment by individual Canadians in their country. The Government is saying, "We want Canadians to invest. We want Canadians to build and create jobs. We want Canadians to be successful". It has been estimated that almost 1 million Canadians make capital gains, a vast majority of whom earn less than $40,000. This capital gains incentive is a strong signal that the new Government wants people with good ideas and the will to persevere to enjoy the fruits of their success. The Government of Canada is confident that Canadians will accept that challenge.
Small and medium sized businesses will also benefit from our proposals to change regulations governing RRSPs and pension fund investments. These measures will allow greater investment by pension funds in new businesses and small businesses seeking to expand. The measure will enable people with RRSPs to invest the plans directly in smaller Canadian businesses.
Small businesses and farmers will benefit from the extension of the small business farm program until 1987, and small businesses will be exempted for one year from the 5 per cent corporate surtax in recognition of the importance of strengthening small business and facilitating job creation. New and growing research and development companies will be entitled to a direct refund of the full tax credit that they earn on their first $2 million of R and D each year. Action will be taken to make the system fairer and to improve tax administration. These actions will benefit all of us, but especially entrepreneurs and small business owners by reducing administrative headaches.
Last night we saw a Budget that balanced tax fairness, effective Government management and the encouragement of private initiative. In order to accomplish those goals we all know that tough medicine is required. Last night someone in my apartment building approached me and said, "I think it is a good Budget but I am sorry that drinkers and smokers have to be taxed." I am sorry about a lot of things, Mr. Speaker. I am sorry that for 18 years we had a Government that overspent and misspent taxpayers' money. I am sorry that we built airports to which no one wanted to fly and that we build planes
May 24, 1985

that nobody wanted to buy. I am sorry about all those things. This redoubles my commitment and the commitment of the Conservative Party to do something about the mistakes of the past and to make a clear statement that the Government alone cannot solve the problems of this country.
I believe the Budget contains a number of actions that will be taken to ensure greater fairness in the tax system. Specifically there will be a minimum income tax imposed on upper income Canadians in place in time for the 1986 taxation year. This I know is a concern to Canadians. I think most of us realize that we have to pay tax, but all of us want to have the assurance that everyone will pay his or her fair share. In addition there will be a temporary 18-month deficit reduction surtax on high-income Canadians and large corporations. Also there will be a tax on the capital of large banks and trust companies. There will be amendments which will prevent taxpayers from avoiding tax by splitting income through the use of loans to spouses and children. There will be the elimination of tax shelters involving property, such as yachts, recreational vehicles and hotels.
Equally important is how the Government collects taxes. The Budget also includes a number of measures to achieve fairer tax administration consistent with the Canadian Charter of Rights and Freedoms; the extension of the "Innocent until proven guilty" concept to cases involving sales and excise taxes under the Excise Tax Act; clear limits to Revenue Canada's powers of search and seizure, and limits on the Government's authority to make retroactive income tax regulations.
I am proud to be a part of a Party that includes people like the Minister of Finance who stands up for what he and this Party believes. We follow through with our election pledges. I think that is something Canadians have not been used to for a long time. I was amazed after being elected by the number of people who wrote to me saying, "I know you said that during the election. Will you do something different now you are elected?" This is what people saw before. That idea and that type of Government is finished in Canada, Mr. Speaker.
This Government is consistent. What I said in St. David's, in Willoughby Township or Queenston is what I say here in the House of Commons. Members of the Progressive Conservative Party are consistent in what they say. When we saw the Minister of Finance last night they saw the commitment, the honesty and the courage of that man. I believe that commitment, that honesty and that courage is what brought us here on September 4. I believe it is that honesty, courage and that commitment that will keep us here.


Mr. MacLellan:: Mr. Speaker, the Hon. Member for Niagara Falls (Mr. Nicholson) is sorry about a lot of things. I am sorry that I had to listen to him. I take great exception to statements attributed to people, particularly because he is fortunate enough to have relatives in Cape Breton and was not fortunate enough to be born there himself. He is attributing some ludicrous comments to people whose names he has not given, whose identities are unknown, people who have said they did not think the Government had the guts to close the heavy water plants that are putting 700 people out of work,
The Budget-Mr. Nicholson
that this was breaking a Government commitment that the heavy water plants would not be closed until alternate employment was made available. What about the $100 million to $125 billion which the Government will now have in its treasury? What about the $2.1 million the Government saved cancelling the decentralization to Sydney, the $8 million the Government saved not going ahead with the downtown program in Sydney and the $64 million the Government saved in not going ahead with the coal wash plant. What about the $5.1 million the Government saved not going ahead with the wharf at North Sydney and the $8.3 million the Government saved not going ahead with the federal building in Sydney, plus millions of dollars for stages three and four of the coastguard college? All this was to announce a ridiculous advisory committee today, putting needed funding, $1.5 million in the fish plant in Glace Bay, $12 million in Donkin and funding for the strait areas. What dribble it is to say how this is such a wonderful thing the Government did and what a courageous decision for a community that already has 40 per cent unemployment.
I would like to ask the Hon. Member, who is using the privilege of the House not to be called to task on what he says, whether he really thinks this is a good thing, that what has happened is good for the people in Cape Breton.


Rob Nicholson: Mr. Speaker, I have a pretty good idea of what people are sorry for. They are sorry that Members like the Hon. Member for Cape Breton-The Sydneys (Mr. MacLellan) and the Liberal Party have been running this country for the past 20 years. That is what people are sorry about.
Let me say something about Cape Breton. It was time to say enough was enough. One hundred million dollars to create 600 or 700 jobs is too much. This Government had to take the step. It was a necessary and a courageous step. It was time to put Cape Breton on a more economic and sound footing. For the first time Cape Breton has the chance for industry to come to Cape Breton. I want it, the Hon. Member wants it, all of Canada wants it. Now is the time. This Budget is the first step toward creating employment in Cape Breton, the employment that Cape Breton deserves.


Maurice Brydon Foster: Mr. Speaker, I would like to ask a question of the Hon. Member for Niagara Falls (Mr. Nicholson) who I know is very concerned about the agricultural industry, the wine industry and the grape growers. Does he agree with the statement today by the wine growers group from Niagara who are opposed to the Budget? They find it unacceptable because it raises taxes on wines and spirits. Does the Hon. Member agree with the people he represents in the Niagara belt?
Another concern of many farm groups is a nine-cent-per-gallon increase imposed on gasoline and farm fuel through taxes. Does he agree with that?
Would the Hon. Member comment on another subject? Premier Miller, the Premier of Ontario, and the Treasurer, Bette Stephenson, have criticized the Budget. They are oppos-
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ing it. They said that the Budget did not stimulate job creation and did not address the need for more housing in Ontario. I assume by implication that that includes housing in the Niagara Peninsula. Could the Hon. Member comment on the statements today of various groups in the area which he represents?


Rob Nicholson: Mr. Speaker, the farmers of my area are very much like other Canadians. They want the Government to be sensitive to their needs. They know we have been responsive.
The Hon. Member failed to mention that just last fall-and none of the members of his Party raised this issue because they do not want to raise good news in the House of Commons-the Government picked up the full 100 per cent surplus of grape crop. We spent $12 million to help grape farmers in my area. They know of the efforts which are being made by individuals like myself, the Hon. Member for Welland (Mr. Pietz), the Hon. Member for St. Catharines (Mr. Reid) and other Members from the grape growing region of Canada. They know the consistent efforts which have been made to promote Canadian wines in Ottawa and across the country. They know those things.
As I said in my speech, one of the things farmers in my area came to see me about was the capital gains tax on their farm property. They wanted to be able to dispose of their property or to acquire new property. They do not want to have the burden of capital gains. When I go back to my riding of Niagara Falls, they will be very pleased because of the specific measures which help farmers of my area. As well they will benefit from all parts of the Budget.
Farmers are just like any other Canadians. When the federal Government puts its fiscal house in order, they benefit. When the Government is not spending all its money on interest, they benefit as well. I believe the farmers in my area and the farmers in the constituencies of other Members of the House of Commons will be very, very pleased with the results of the Budget.


Mr. Stackhouse:: Mr. Speaker, I should like to take a moment to express my appreciation to the Hon. Member for Niagara Falls (Mr. Nicholson) for the excellent contribution to the budget debate, both in terms of the content of his speech and in terms of its delivery. He brought forward many points upon which we need to focus our attention as a House and as a people, particularly the wasteful spending on projects which have been continued for too long, such as the one in Cape Breton, costing taxpayers $100 million per year. My Liberal friend is understandably concerned about the abolition of that program. We could provide a substantial amount of money to the people of that area instead of into heavy water. We could pay 600 people $50,000 per year and still save Canadian taxpayers a substantial amount of money. We ought to be more concerned about helping people rather than continuing wasteful industries. I express appreciation to my colleague. I know he expressed the concern which I have heard many other Canadians put forward, and that he is speaking for them.


John R. Rodriguez: Mr. Speaker, I have a question for the Hon. Member for Niagara Falls (Mr. Nicholson). He indicated how the Government had to be tough in the Budget. In his riding, just as in my riding, there are many citizens who are receiving the old age pension. Can he give any justification whatsoever for the Government in fact asking those who are living on the old age pension, which is below the poverty line, to absorb the first 3 per cent of the inflation rate? Why is it that his Government can be so tough on those citizens yet so easy on the very wealthy? Everything which is progressive has to be studied, the minimum tax has to be studied, but when the Government wants to zap senior folk, it is tough. Why does it not get tough with its friends for a change?


Rob Nicholson: Mr. Speaker, this Budget is tough, but my friend forgot to mention that it is tough but fair. That is what this Budget is.


Some Hon. Members:: Oh, oh!


Rob Nicholson: I listened to the Hon. Member when he asked his question; they should let me reply. They do not want to listen to logic. We are taking nothing away from senior citizens. If the Hon. Member read the Budget more closely he would see that nothing is taken from the gross income supplement. It continues, fully indexed, and it will protect senior citizens. Also he forgot to mention the child tax credit. That benefits the neediest in society, but he forgot to mention it. It does help. It helps senior citizens. It helps people on low incomes with children. It helps the neediest. The Hon. Member also forgot to mention the surtax on corporations and higher income Canadians. That is with whom we are getting tough.


Benno Friesen: Mr. Speaker, on a point of order-


John R. Rodriguez: Mr. Speaker, I rise on a point of order. I want to bring to Your Honour's attention that if an Hon. Member rises on a point of order, he can only do so if he is in his seat, not from his buddy's seat.


Paul Wyatt Dick: Mr. Speaker knows that.


Benno Friesen: Mr. Speaker, it is always a delight to learn procedure from the Hon. Member for Nickel Belt (Mr. Rodriguez). I rise on a point of order because the Hon. Member for Nickel Belt raised questions with the Hon. Member for Niagara Falls (Mr. Nicholson) about matters which were not included in his speech. The question period following an Hon. Member's speech is supposed to relate to the remarks of the Hon. Member. I could have intervened sooner, but I knew that my friend from Niagara Falls could very well look after himself. I just wanted to point out that the Hon. Member for Nickel Belt was completely out of order in his questions.


John R. Rodriguez: On the same point of order-


The Acting Speaker (Mr. Charest):: That will be the last one as the period for questions and comments is now over.
May 24, 1985


John R. Rodriguez: Mr. Speaker, I rise on the same point of order; I only rise because the Hon. Member mentioned my riding. I raised a question with the Hon. Member for Niagara Falls because he in fact praised the Budget for being fair. When it is so obviously unfair, I had to point that out with a question and get his response.


Steven W. Langdon: Mr. Speaker, there has been an amazing circus criss-crossing the country over the last week or so trying to add some new buzz words to the political vocabulary of Canada-tough but fair, tough but fair. They hit the headlines, they hit the newscasts. They seem to have hit everything except the Minister of Finance (Mr. Wilson) because what he brought in was a tough luck Budget. It is a Budget which is hard on Canadians. It is a Budget which is hard on the people who make up my constituency and the constituencies of every Member of the House of Commons. It is a Budget which is anything but fair. It is a Budget which is unjust. It is a Budget which is typified by the fact that our finance critic, the Hon. Member for Kamloops-Shuswap (Mr. Riis), could read portions from the Lalonde Budget and have the Conservatives clapping, thinking it was their Budget which they were supporting. It is a Budget in the sorry, sad and failed tradition of the Liberal Government which went before this Government.
I had hoped-I must say against hope, but I am an eternal optimist-that the Government would have learned its lesson after November, that it would have learned that the Liberal Party approach of cut-backs and of a fatuous concern with the deficit is an approach that will lead us to disaster.
I stood in my place in the House of Commons after the November statement and I predicted-and I ask Hon. Members to check the words which I stated at that stage-that in fact the budget changes which were brought in then, because they had the effect of decreasing economic activity in the country, would increase the budget deficit. Everybody looked quite amazed and thought that that could not happen. However, when the Minister of Finance stood yesterday, he conceded that the budget deficit is now $36 billion, not $35 billion as he projected.
The reason is absolutely clear. It is that economic activity has been slowed. Investment has not had the kind of expansion and buoyancy that this Government expected to occur, by magic. Instead we have had a perpetuation of an unemployment rate that is shameful for any country to experience. We have an unemployment rate 4 percentage points above that the United States. The unemployment rate is not significantly decreasing. It is an unemployment rate that persists, and we have a deficit that is rising. That is precisely what we predicted would be the consequence of the November statement, which followed the wrongheaded policies of the previous regime. Rather than accepting the lessons that we so magnanimously offer, these misguided souls on the Treasury benches continue in their misguided ways. They do so with a particular sense of affrontery as far as this Budget is concerned.
The Budget-Mr. Langdon
There is a level of unemployment in this country which our action group on jobs, as it criss-crossed across this country, heard described in place after place, community after community, as a human tragedy, a tragedy that was destroying the hopes and expectations of our young people. It is a tragedy that is putting into the ashcan of our society the older workers.
I presented a petition this morning from people in Kitchener, people who represent older workers, those over 40 and older. They do not have the prospect, as things stand in this country, to find jobs for themselves. The tragedy is very much there.
Forlorn optimist that I am, I expected that somehow there would be within this Budget something to permit the poor back-benchers to defend it as they go back to their constituencies this weekend, so that they would be able to point and say "There is a community initiatives fund that we have set up to assist communities to get people back to work. There is a youth initiatives fund to permit young people to start up their own businesses. There is something that would assist agriculture". Perhaps there could be the kind of thing we suggested in our group report. $100 million to help soil conservation measures in agriculture or the $200 million that we suggested to support reforestation in this country. I did not expect that would be the thrust of the Budget.
I have listened to the rhetoric of the Prime Minister (Mr. Mulroney). Being the Prime Minister, I certainly thought we could believe him. He is a clever politician. I thought that within the Budget he would have inserted some gestures, some symbols of concern about the vast number of people out of work in this country. Granted, they might just be symbols; $200 million for a community initiatives fund instead of the $850 million that we recommended. I thought there might have been a limited amount for agriculture and a limited amount in terms of support for industrial renewal. I searched.
Yesterday I sat in on the lock-up. I figured it would be a difficult Budget to analyze. I thought within it there would be symbols or gestures and that it would be difficult for us as opposition people to make our way past some of the gestures to find the real substance of the Budget. In fact, this Government made it easy for us. It set before this House a Budget which, believe it or not, in a country with 10.9 per cent of the population out of work, does not have a single initiative to put people back to work directly. There is not a single initiative or a gesture to help, for example, get 20,000 people back into the workforce. There is not a single initiative to help people in agriculture.
I feel for the back-benchers who will face criticism from those in their constituencies who will be out of work over the next eight months, indeed the next 18 months. As a politician, I find it unbelievable that a Government would bring in a Budget that has in cold black print, which each of us will circulate as widely as possible throughout this country, a projection, and I refer to the Government's statistics in Table 5 of Canada's Economic Prospects, that 18 months from now, in December 1986, there will still be 10.3 per cent of the workforce in this country out of work.

May 24, 1985
The Budget-Mr. Langdon
In the course of a year and a half this Budget has set itself the heroic goal of cutting the rate of unemployment in this country by .6 per cent. Congratulations to those on the Treasury benches. I admire their political courage. They have guts indeed to stand before the country and say that this is a Budget about jobs when their own figures tell us that in 18 months the unemployment rate will have been reduced by .6 of a percentage point, and that with the most incredible of assumptions.
When you start as an economist instead of a politician to look at the assumptions that lie behind this Budget, you find they are assumptions behind which no independent economist with whom I am acquainted in this country would be prepared to stand. They are assumptions that suggest that growth rates inthe United States are going to continue to be quite positive for the next two years. We know from United States statistics that there is a significant downturn in economic activity occurring in the United States which makes those figures laughable, pie in the sky.
At the same time, if you look at the figures for investment next year in this country, which are plugged into this Budget, you see the bizarre prediction that there will be a real increase in investment in this country next year of 6.4 per cent in non-residential investment. Incredibly, it will be 10.7 per cent for residential investment. This is to happen at the same time as consumer expenditures in this country go up, according to the Government's own statistics, by 1.1 per cent.
I would hate to suggest that the Minister of Finance needs to return to first-year economics. I would hate to suggest that he needs a better understanding of the very basic laws of investment in any country. However, I would ask the Conservative back-benchers who come from the business community, if they were to face in cold, hard print the Government's prediction that there will be an increase of only 1 per cent in consumer spending, would they make vast new investments? Would they put their hard earned cash into risky business ventures in the hopes that they would be successful? I assume that Conservative back-benchers recognize, as Conservative front-benchers do not, that businesses need customers.
The Government would have us believe that people will rush out next year to put 10.7 per cent more investment into residential investment and 6.4 per cent more into non-residential investment, while at the same time consumers will only spend 1 per cent more. That is absolutely laughable. It is indefensible to anyone from the Conservative back-benches who has a degree in economics or at the very least has been in business for some years.
I plead with Conservative back-benchers to take the Minister of Finance aside and explain to him the facts of life. Tell him how the business world works, explain to him and the Minister of State for Finance (Mrs. McDougall) that across this country, small businesses want to know that they will have customers and that there will be a market for what they produce before they invest. I beg them to go to him. I would
not ask them to do so publicly, as I do not want them to get into trouble.


An Hon. Member:: What about heavy water?


Steven W. Langdon: For the benefit of the Hon. Members who mentioned heavy water, I was on record back in November as saying that those plants should be shut down. The reality of that is an important part of this Budget, but it should have been done with measures to see to it that the Cape Breton economy gets an injection of direct government support to assist the steel industry and the coal industry. There is absolutely nothing to provide a counterweight to the price Cape Breton is required to carry.
We have before us a Budget which is totally, and bizarrely inaccurate. It is a Budget which is based on dreams. It suggests to me that the Minister of Finance must be about to bring forth a Bill to legalize marijuana. It seems to me that this Budget was brought forth in a haze of dreams. It is a Budget built on fraud, on myth and on a total misunderstanding of how the small business community works. We have a Budget which hammers the people of this country.
It is estimated that in Essex County average families will pay an extra $500 in tax this year as a result of this Budget, and will pay nine cents more per gallon of gas. When their kids go to get soft drinks at the store they will have to pay federal sales tax. When the wives buy makeup they will have to pay federal sales tax. Medicine and health products are being taxed. There has been a big jump in taxes on beer, cigarettes, liquor and wine. Sales taxes on all goods are going up. Via Rail is going to raise its fares at least 30 per cent in the Windsor to Quebec City corridor. There will be an income tax increase of at least $215 per family. This is coming from a Government that promised it would not bring in increases in income tax.
What we have before us is a Budget that, in economic terms, is a hopeless disaster, and in human terms in an unfair burden imposed upon the people of this country.
There has not been one single specific move to put a minimum tax into effect. There will be a decrease of $540 million in corporation taxes for next year while individual taxes will go up $1 billion or even more by 1991. We have a Budget that hurts the resource sector through cut-backs in agriculture and fisheries. It is a Budget that hurts the industrial sector through cut-backs to IRDP.
To conclude, it is a Budget that fails completely to meet the hopes and expectations about which we heard across the country as our action group spoke to hundreds and hundreds of groups of Canadians. The Government talks about consultation. We actually consulted instead of just playing the game. What we heard led to a budget proposal entitled Canada Unlimited which contains a real set of benefits for Canadians, not the kind of damage that this Budget invites.


Barbara Jean McDougall: Mr. Speaker, I am really very pleased that the Hon. Member reminded us once again that he is an
May 24, 1985

economics professor. I know who should go back to take the first-year course in economics.
We in this country have experienced some of the things recommended by the Hon. Member like the Youth Initiative Fund. These are little funds in little pots. What has this left us? It has left us with huge deficit and unemployment. While the Hon. Member was speaking of all the funny-money economics at which he seems to be so expert, the Hon. Member for Guelph (Mr. Winegard) was meeting with 40 senior citizens in the lobby of this very building. These senior citizens commended the Government for its Budget.
How can the Hon. Member reconcile what he said today with the statement he made while smiling into the television camera earlier this spring? At that time he said we can't simply accept continuing large deficits; that does not make sense. There are only two ways to reduce the debt of this nation; reduce expenditures and increase taxes. Does the Hon. Member have another suggestion?


Steven W. Langdon: Mr. Speaker, I have in fact 70 suggestions which were put together in the proposal entitled Canada Unlimited. I would argue that it contains an approach which recognizes reality. The reality is that we now have a deficit of $36 billion, not because the previous Government set out to achieve that level of deficit, but because it bought exactly the same kind of crazy, mixed up logic of which this Government is speaking. The Government thinks that if it cuts back, raises taxes and relies on the corporate sector, it will put people back to work and bring down the deficit.
Earlier today we had the quite dramatic spectacle of Conservatives clapping vigorously for phrases which came out of the Liberal Budget of Marc Lalonde. The reason for that is absolutely clear. That Liberal Budget did exactly the same thing. It tried to cut the deficit and the result was an increase in the deficit.
I would like to make it very clear that Canada cannot afford over the next three to five years to keep building deficits. It is not fair to future generations if we spend 30 per cent of what we take from the taxpayers of the country to service the public debt. It is wrong and morally indefensible. If we want to do something about that burden, there is only one way to do it.
When I commented on the November statement, I predicted, because of the cut-backs and the tax increases, that the deficit would be higher than $35 billion. Was I right? I was absolutely right. The deficit is now $36 billion. I will make exactly the same prediction today. The Government thinks it will reduce the deficit by squeezing the economy. The result will be a higher deficit. The people in the Treasury benches will help to bankrupt the country. They will have to carry the responsibility in the years ahead. There is a single answer. [Translation]
There is only one solution, and it must be one that will provide for a growing economy.
The Budget-Mr. Langdon

It is necessary to have an economy which will grow fast. This economy, as a result of the actions of the Government, will not grow, it will decrease. In 1985 there will be a growth rate of 3.1 per cent, and in 1986 the growth rate will be 2.4 per cent. The Government is driving the country into disaster, as the Liberal Party did before it. As a result, we will end up with a higher deficit. Members on the other side of the House will be to blame for that.
The answer is to bring into effect what the NDP presented six weeks ago. We need a significant change in the tax system which would require the corporate sector to pay its fair share, instead of decreasing corporate taxes which this Budget does. We need a change which would put a permanent fair tax burden on wealthy Canadians. It should be permanent, not a one-shot surtax. At the same time, we should be providing tax relief for ordinary Canadians. We should be providing tax benefits for working people. The working people should not have the tax loads which they will be required to pay as as result of this irresponsibility.
If we put the significant amount of money we would get as a result of those changes into community initiatives and provided help for young people, communities, the housing industry and municipalities, people could return to work. The unemployment rate would be cut by 2.5 per cent, not by the .6 per cent about which the Government seems ecstatic. I would warn government Members, when they go out into the country to defend a target or a prediction, that over the next 18 months the unemployment rate will only be reduced by .06 per cent. Those Members will come back to the House with red faces their tails between their legs. As a result, I hope a new Budget will be brought down within three months.


Mr. Pietz:: Mr. Speaker, I would like to ask the Hon. Member for Essex-Windsor (Mr. Langdon) a question about his statement regarding transportation and gasoline costs in Windsor. Why has he said nothing about the incentives the Minister of Finance (Mr. Wilson) has continued to make available to encourage Canadians to convert to alternate fuels? He did not tell ordinary Canadians that, rather than increasing their transportation costs, they could decrease those costs as much as 45 per cent by converting to alternate fuels. He knows that in Ontario, for example, automobile owners are forgiven the provincial sales tax on their vehicles if those vehicles are converted and if the refund is applied for within 30 days.
The Minister of Finance has continued to provide $400 for conversion to propane, and $500 for conversion to natural gas. As a result, conversion costs can be recovered. The Hon. Member knows that alternate fuels such as propane can be purchased at approximately 25 per cent of service stations. Alternate fuels also cut down on pollution. As well, they are Canadian fuels. Alternate fuels help to put Canadians back to work. Why does he not recommend the 45 per cent savings to ordinary Canadians and recognize the Minister's consideration in this regard?

May 24, 1985
The Budget-Mrs. Duplessis


Steven W. Langdon: Mr. Speaker, I am very pleased that question has been raised. In fact, there are so many targets in the Budget that I did not want to touch on all of them. A most destructive, senseless and ridiculous approach has been taken in the Budget. At a time when we are trying to save energy and, indeed, as the Members said, to encourage people to convert to alternate energy sources, the Budget has placed a federal sales tax on wood burning stoves, wind deflectors, heat pumps, solar heaters, panels for furnaces, insulation materials, wind generators, windmills, wind deflectors and other such goods. Serious and shameful damage is being done to the alternate energy sector, as well as the increases which will face people in the Member's constituency and mine as a result of the increases in transportation costs which will hit the rail corridor between Windsor and Quebec.


Suzanne Fortin-Duplessis: Mr. Speaker, today is a great day because I have been given an opportunity to defend an excellent Budget, and it is also a day I have been waiting for ever since I became a Member of this House, because today I am making my maiden speech in this House.
The Budget brought down yesterday by the Minister of Finance (Mr. Wilson), the Member for Etobicoke Centre, is of paramount importance. It constitutes a turning point, a totally new economic direction that the Government of Canada is obliged to take, without delay. We have turned the page. The economic situation in Canada had become critical and reducing the deficit was both necessary and urgent. This was due to the following, and I would like to quote what the Minister said in his speech, and I quote:
High deficits constrain our ability to promote growth and create jobs. High unemployment in turn contributes to even higher deficits.
Canada was caught in a situation from which it could be freed only by taking a totally different approach. This Budget addresses the vicious circle of unemployment and debt, which was spiralling upwards at a terrifying rate.
This Budget's philosophy is to urge Canadians to take the initiative and to become the instrument of our country's economic renewal. It was important to allow the private sector substantial room for manoeuvring, because the State cannot act as an absolute power and constantly tell its citizens what they must do. Canadians want jobs and they want permanent jobs. However, it is not up to the Government alone to create jobs. All Canadian men and women must help make it happen: small businesses, medium-sized businesses, big corporations and the Government. In this context, the new measures being proposed are very definite incentives. That is why, Mr. Speaker, as the Member for the riding of Louis-Hebert, it is with great pride that I rise in the House today to speak to the concerns of my constituents who, I am sure, will understand the sound reasoning behind these budgetary measures.
I would like to describe, very briefly, my riding which is located on the shores of the St. Lawrence and includes four towns, Sainte-Foy being the largest with a population of 70,000. My riding also includes Sillery, Cap-Rouge and L'An-cienne-Lorette, which are not as big and together have a population of 100,000. Sainte-Foy airport at L'Ancienne-Lorette is also in my riding, which also has a railway station and a bus terminal. I would say that as far as transportation is concerned, my riding is well provided for. Tertiary services are also adequate, and Sainte-Foy has built sports facilities where some of our gold medal winners have trained.
I know my riding and I know its major issues. As a former municipal councillor in Sainte-Foy, I became acquainted with all the townships. I know the mayors of all four towns in my riding, with their councillors, and also the leaders of organizations and their members. This is a great advantage in serving my constituents to the best of my ability. The residents of Louis-Hebert have a great deal of courage and are able to rise above adversity, and they are also very creative people. For months and even years they have been working on a new economic venture that will benefit the entire Quebec City region. It is incredible to see how well all these organizations, all these people with varying interests are able to work together towards a common goal, and I am thinking, for instance, of the hi-tech industrial park, where high-precision optical and laser instruments will be manufactured.
Mr. Speaker, the riding of Louis-Hebert also has a number of educational institutions including Laval University the oldest francophone university in North-America and also the Sainte-Foy CEGEP, the College Notre-Dame-de-Foy and St. Lawrence College.
Mr. Speaker, you will understand that I am all the more concerned for young people since this year is International Youth Year, which is only fair.
Being a teacher, I can assure you that I am very sensitive to the requests and recommendations made to me by young people. That is why, Mr. Speaker, you will readily understand that I am very pleased about the action taken by the Government to create jobs. As you know, unemployment is a terrible ill facing all young people who enter the labour market and must often resign themselves to live on welfare, because all their efforts and goodwill are often of no avail. All the cases submitted to my constituency office are vivid proof of this fact.
The proposals contained in this Budget, which aim mostly at creating new jobs, can only help these young people to finally join the labour market, and most important, to find permanent employment. In addition, as announced by the Minister of Employment and Immigration (Miss MacDonald) at the First Ministers' Conference in Regina, there is now a Conservative approach to training and employment designed to promote professional training rather than short-term jobs. With such an approach, an increased participation by the private sector and local businesses is essential. That is why, in view of the
May 24, 1985

importance of such an initiative, $900 million have been set aside for these programs this year and an additional amount of $900 million will be allocated in 1986-87. One can only rejoice at such an initiative, which will have a direct impact on these young people looking for a job. I can only approve such a Budget, Mr. Speaker.
In the same connection, the field of research is close to my heart because, obviously, young people will have to live with technological change. High technology is future-oriented and will create a tremendous number of jobs.
Mr. Speaker, the residents of Louis-Hebert are lucky in this regard. Indeed, we have at Laval University, which is very active in the area of research, especially in medicine, optics and laser technology, and elsewhere in the constituency two highly sophisticated scientific complexes, namely, the National Scientific Research Institute, which specializes in water and geological research and also has a second role, that of teaching students at the second and third cycle levels. Moreover, there is the Quebec industrial research centre, which cooperates with industry to develop products as much as possible according to the major directions of the technological approach taken by the Quebec Government.
It was therefore essential that such an important field continue to get federal support, and by refunding 100 per cent of the tax credit earned by small businesses on their first $2 million of qualifying expenditures on research and development each year, the government is making it much easier for new industries which have problems attracting investment capital to expand. Since high technology is a leading sector which will develop even more and become increasingly important in industry, the risk taken by potential investors is most interesting because it is a guarantee of future profitability.
By abolishing the flow-out of the scientific research tax credit to foreign investors, the Canadian Government urges more Canadian investors to take advantage of this measure, and most important, I want to emphasize that it gives them a choice. Everyone is free to invest if and as he chooses.
As I have just pointed out, it must be acknowledged that potential investors are bound to be attracted to this sector because it will continue to expand, thus practically cutting risks down to nothing. It is a safe investment.
Mr. Speaker, this measure will enable the riding of Louis-Hebert to take its rightful place in the technological revolution, ensuring the development of the riding and the creation of jobs related to that sector. Allow me to quote the words of the Right Hon. the Prime Minister when he visited my constituency in 1982:
This region and this riding have everything to become a research and development nerve centre. You have industries, the university, skilled labour, research centres, a social infrastructure and so on. All you need now is the willingness of the federal Government to set targets that reflect the requirements
The Budget-Mrs. Duplessis
of the situation and the talent of our people, and to cooperate with Quebec to turn that into reality.
And today, Mr. Speaker, I am delighted to see that the federal Government is willing and anxious to contribute more generously to technological development. I am convinced that the implementation of those measures will enable us to fulfill our aspirations. The Canadian people want to succeed and the residents of my riding share the same ambition. I know them very well, so I have no doubt about that. The harmony which our Government has restored since September 4 between Ottawa and the provinces, particularly the Government of Quebec, augurs well. This dialogue can only benefit all citizens in the constituency of Louis-Hebert, Quebec, and even Canada as a whole.
I can assure the various interest groups of my region that they have my full support in their quest for those objectives. I must emphasize that, through a tax credit, the federal Government will encourage individuals to invest in Quebec's Fonds de solidarite, or in any other similar fund which benefits from provincial tax assistance. Quebec's Fonds de solidarite is a very worthy initiative that came to light after representations were made by the Quebec Federation of Labour to provincial Employment Minister Robert Dean. It is an outstanding example of labour participation in investment projects whose first priority is to help small and medium-sized businesses. It is administered by a 13-member board of directors whose mandate is to invest the funds and make sure that the investments are designed to reach the objectives, namely maintain existing jobs and create new ones.
The tax credit now available in Quebec is one of the best. For instance, someone who would buy 100 shares of $10 today-an investment of $1,000-would in fact have to pay only $187 after eligible tax deductions. In addition to the tax credit already given by the Province of Quebec, the new federal Government tax credit will be a further incentive to make such investments, and the short and long term impact on the economy can only be very positive.
Now, as a woman and a mother, I am very sensitive to the standard of living of women in our society. I am very pleased with the proposals concerning family benefits, which point to this Government's constant concern for the less-privileged in our society.
Many of my constituents were quite apprehensive of a decrease in family allowances. I am proud to reassure them, because these have not been affected. On the contrary, the Government has announced a restructuring of family benefits along the lines of a tax credit. Those changes resulted from suggestions made by a large number of Canadians. Starting in 1986, the Minister of Finance announced that the child tax credit paid to low-income families will be significantly increased to $524 per child as early as 1988, a $140 increase. Moreover, the income level at which the credit begins to phase out will be lowered. Starting in 1987, tax exemption for

May 24, 1985
The Budget-Mrs. Duplessis
children will be reduced over a three-year period so that the exemption for children under age 18 will be equal to the level of family allowances. I am very pleased with those measures. They show this Government's concerns for families, the basic structure of our society and the starting point for economic growth. Again this is why I am so pleased with those measures.
Finally, Mr. Speaker, 1 am proud to say that the constituency of Louis-Hebert, the constituency I love so much because of its lively people who are decidedly determined to pull through, is a model of co-operation, and this budget will allow them to fully exercise their initiative and enterpreneurship. These budget measures which are directly aimed at helping small and medium-sized businesses will finally help put people of every age group back to work. They do not privilege any specific group. In that sense, this is a budget that is just and fair for each and every Canadian man and woman. Work is vitally important in our society. By means of this budget, the Canadian Government will enable a very large number of Canadians to recover the dignity they lost with their jobs. Work gives the individual back his or her dignity. This is why it was so essential to deal now with this problem. This Conservative Government, on the other hand, has created 200,000 jobs since September 4, 1984, something which the previous Government could not do in 12 years.
Statistics show also that last month we experienced our largest employment increase in five years, and this is most encouraging. These figures, Mr. Speaker, show how much emphasis my colleagues and myself are laying on the difficult problem of unemployment, and we are willing to do everything that is needed to correct the situation and make sure that economic recovery is effective and producing results as fast as possible. We had to be reasonable and not slash too deeply into the deficit because this would have hurt the less privileged provinces, something which we could not accept. Our sense of justice and fairness would not have it. As any good manager, the Government is aware that it must pay its debt back or at least reduce it, because the astronomical amounts of money needed to pay interests on that debt clearly hinder our economic recovery. Therefore, Mr. Speaker, we had no choice, it was an unavoidable obligation.
People of Louis-Hebert, Quebecers, Canadians, have faith in us! This new direction was necessary and urgent on the short and the medium term. I am convinced it will have a very positive impact and will help economic recovery by promoting growth in the private sector. Canadians at last will be able to return to work and regain their dignity, a sine qua non condition for the full development of all individuals. We support small- and medium-size businesses, Mr. Speaker, because we know that their owners who are very good administrators and who feel that a penny saved is worth more that a penny earned will not squander their money. They have repeatedly told us: "Reduce the deficit and pay your debts. We know, because we are involved in trade and commerce, that if
we behaved the way the government has so far, we would have been bankrupt long ago. We do not act irrationally, we tighten our belts and we keep a close watch on our spending." I know that there are employees who accepted salary reductions to keep their jobs when interest rates were so high. They have managed to survive. I know also that there are board chairmen who withdrew their children from private schools, sold their summer cottages, renounced their regular games of golf, lived sparingly and survived those difficult times. Today, we are calling on the Canadian public as a whole to help our country which has run into a financial dead-end and must find a way out. We must revive our economy, create jobs, rationalize government spending, administer with increased efficiency. There will be no increase in the operation and investment budgets of the departments ... I just need a couple of seconds more to conclude, Mr. Speaker. Operation and investment budgets of the departments will no longer be increased to reflect inflation. Each and every one of us must do his or her share, so that our children may live and hope for the dignity which results from the satisfaction of a job well done, raise a family and live as our parents used to before the degrading and decadent Liberal era.


The Acting Speaker (Mr. Charest):: Questions, comments. The Chair recognizes the Hon. Member for Capilano (Mrs. Collins).


Mrs. Collins:: Mr. Speaker, I would like to congratulate the Hon. Member on her Maiden Speech. It was wonderful and the first of many in the House. I share her tremendous enthusiasm for this Budget. I have been receiving very positive response from my riding of Capilano in British Columbia about the initiatives which the Government is taking.
I think there is an aspect of the Budget that we have not yet discussed to a great degree. One of the major emphasis is, of course, on the development of small business. It is now possible for pension funds and RRSPs to be put into small business. Women are really the engine behind the creation of so many new small businesses. I therefore feel that this Budget is a tremendous boon to the women of the country who have entrepreneurial spirit and want to get involved but have not had the necessary financing. Would the Hon. Member agree that the initiatives we are taking in the Budget will be a great boon to the women of the country in getting their small businesses going and growing and creating the jobs which we all want?
[ Translation]


Suzanne Fortin-Duplessis: Mr. Speaker, I thank my colleague for her kind words and also for her question. The essence of my entire speech was to say that in my opinion the incentives made available to small and medium businesses, especially as far as research and development are concerned, will in the long-term really create jobs. Let me explain that. If small businesses are
May 24, 1985

allowed to invest in research and development and at the end of the year, to recover that money through a tax credit, I think that an increasing number of small industries will explore new avenues and thus create jobs in the long term.


The Acting Speaker (Mr. Charest):: Questions and comments. Debate. The Hon. Member Mount Royal (Mrs. Finestone).


Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, a federal Budget is supposed to do a great many things. First and foremost it is supposed to be about ordinary, everyday people. It should assure them that their Government is listening to them, cares for them, and is committed to ensuring equal opportunity for careers, education, recreation and retirement. A Budget should be about people and their lives, but this Budget is about none of those things. It gives none of those assurances. It is cold and insensitive. It is a statement which fails to understand the urgent needs of Canadian women, of youth, and of the elderly. It has taken this cynical, unfeeling Budget to flush the Conservative Government out on where it stands on issues that really matter to the general population, to Monsieur, Madame, tout le monde. The sound of cold hard cash rings through this Budget ripping holes in our social safety net, but the voices of ordinary Canadian men and women have not been heard.
Canadians had great expectations and hopes for this Budget. The Government consulted and consulted, but reality indicates that this much-touted consultation process has been an utter flop. We waited for more than eight months to see which lobby would win the day. It is not very difficult to discern. The big business boys, the multinationals, the oil companies and the defence industry are the winners. The Government listened to them. I can only hope that the women, the youth, and the labour leaders invited to be consulted at the national economic conference were at least given a cup of coffee and a doughnut, because that is about all they got out of this Budget.
Harry Truman once said, "When you can't convince them, confuse them". The Tories have tried that often enough. Now the Minister of Finance (Mr. Wilson) has gone one better. When you can't confuse, consult.
A federal Budget is also supposed to answer questions and remove uncertainty. This one has done exactly the reverse. Canadians now have more questions than ever before about the Government's secret agenda for social programs and social policy. There are questions about what is going to happen with the maternity benefits program and the unemployment insurance scheme. There is more uncertainty than ever before about how the Government intends to replace the cuts in job creation and training programs. These cuts severely hurt the efforts of youth to find meaningful, lasting work. The lack of detail on the Government's proposed $900 million labour strategy is absolutely shocking and frustrating. You had better check your Budget because I believe that $900 million is not new money. It is renewed from last year.
The Budget-Mrs. Finestone
I listened to the Budget speech yesterday with great care and a good deal of hope. I listened on behalf of women in the workplace, women working in the home, women struggling to make ends meet for their families, women retired on fixed incomes, and women living below the poverty line. I listened on behalf of young people who were promised so much in the last election but have seen so little. I was listening and hoping. However, today I share the bitter disappointment of these women and young people in the reality of this barren Budget.
Before touching on areas on areas of specific concern to women and youth I would like to say a few words about the tone and underlying message of this Budget. Through this tone we see clearly how the Government has ignored the forces of ordinary men and women. In the fourth paragraph on the first page the Minister said:
My Budget calls for Canadians, not government, to choose what is best for Canada. And it challenges Canadians by rewarding success, not subsidizing effort.
I thought that sheer effort and pride in one's work used to be the motto for this society. Apparently now only successful financial effort is of worth. I think the ordinary folk of society will not be very pleased with that.
Further down I see a description of how the discussion process took place. Page 17 contains that marvellous part of the Budget about de-indexing. It reads:
The purpose of indexation has been to protect Canadians from the effects of rising prices. But it has become increasingly clear that Canadians must also find a way to protect themselves against rising deficits and the soaring national debt.
I would like to have that told to single-parent families, to single mothers, the elderly and the poor. How are they going to protect themselves against this rising deficit and the soaring national debt? I am sure they got a tremendous sense of satisfaction from that remark. When you tell people that it is about time they started to pull their own weight to protect themselves, I think it is a bit unfair. This is what I mean when I say that the Budget is cold, insensitive and that it lacks a human face and a human heart.
I could go on. There are so many matters of affront in the tone and the text of the Budget that I am almost ashamed that this is our Government speaking out. Let us look at what the Government says about particular benefits to women, something I will deal with later. As a woman reading what the Government appears to think about me, I wonder about this Government's supposed interest in the other sex.
I want to turn to several points in the Government's Budget that are deeply disturbing to me and I believe to millions of Canadian women and young people.
Canadians expected training for women and youth to be a top priority in this Budget. How often did we hear the Prime Minister (Mr. Mulroney) chant "jobs, jobs, jobs"? What did the Minister of Finance say? From where did he get his guidance? He said absolutely nothing about youth. The guidance he got was from the Nielsen Task Force. It was to address all those concerns particularly relating to youth and

May 24, 1985
The Budget-Mrs. Finestone
women, areas of major unemployment. The Task Force was to look at and determine the kinds of programs women and youth should have. 1 would suggest that Members on the other side of this House take a look at the list of people used in all this wonderful consultative process and notice the absence of the distaff side. There was an absence of women and young people on the committees used by the Deputy Prime Minister (Mr. Nielsen). This makes me very sad for the future of training. What about the cutting that will take place?
We have had Budget cuts in general and critical skills training of $78 million. Young people will have to wait until the fall to hear of any replacement programs. High-tech job training is precisely what young men and women need. Upgrading of skills is essential for women and for youth to secure better-paying jobs. Nearly 500,000 young people are out of work. Yet this Government chooses to cut funds for highly skilled job training. Are we to return to the days when we trained young women to be hairdressers?
Moreover, Mr. Speaker, the Budget's job creation efforts rely totally on the private sector, the same folks who brought us the situation in which women are blocked from promotion, still earn less than men for work of equal value, and still discriminate against women. This is a hope and a prayer job creation strategy and it is doomed to condemn women to job ghettos.
The Government has also created undue uncertainty over the status of the unemployment insurance scheme. Of particular concern to women is the future of maternity benefits. Maternity benefits are a right not a social benefit or a privilege. They are an important bridge for women who wish to continue to work after childbirth. Since 70 per cent of the recipients do return to the job market, I think they have indicated their attachment to the program. It is obvious this program is an integral part of their economic independence. We will be monitoring the Government's plans in this area very carefully. Canada already ranks near the very bottom among industrialized nations when it comes to ensuring paid parental leave. Now is not the time to chip away at this further.
Speaking of chipping away, let it not go by unnoticed that the great majority of federal civil service jobs cut by this Budget will be or are held by women. More than 40 per cent of federal employees are women, many in the lower paid positions which will be most vulnerable to cuts.
Let me speak about pensions. Pensions are a fundamental building block for women as they seek economic independence and autonomy. The Government's Budget has done very little to improve pension opportunities for women. Contrary to election promises, there are no provisions for homemakers in the proposals. The Government's plan to improve vesting rights in employer-sponsored pension plans is as far as it goes. It will in the end benefit few women. Only one third of Canadian women in the labour force are enrolled in private pension plans, because most women work for small companies that have no such employer-sponsored plan, or they are parttime workers with no access to pensions. Do not forget that 70
per cent of all part-time workers in Canada are women, and not necessarily by choice.
The Minister of Finance has also backed away from any Canada Pension Plan improvements. He has bowed to business pressure and backed away from any federal leadership role in mandating a minimum degree of inflation protection for private pension plans, a key part of any reform package. A comfortable pension at age 65 can be eroded by inflation by age 75 without some form of protection. Inflation protection is not a frill but an essential component.
Canadians can add the improvement of pension reform to the growing list of empty campaign promises of this Government.
Let me come to housing now, Mr. Speaker. And what about child care and child benefits? What about federal transfers to the provinces? What about the entire area of youth?


The Acting Speaker (Mr. Charest):: The Hon. Member for Saint-Denis (Mr. Prud'homme) on a point of order.


Mr. Prud'homme:: Mr. Speaker, I rise on a point of order. The interest from the Government is so great for this Budget, I do not know whether the Government's Members are hiding or what, but I would like to remind the House that according to Standing Order 5(3) there is no quorum. I will not call for it.


The Acting Speaker (Mr. Charest):: The Hon. Member for Saint-Denis knows that this is not a point of order.


Gary Michael Gurbin: Mr. Speaker, I rise on the same point of order.
I think, with all respect that the Opposition Parties, both of them, if they would look at their numbers, have as much a duty to attend the Chamber as we do.


Jean-Robert Gauthier: Proportionately we have more than you. It is your Budget, your quorum.


Sheila Finestone: Mr. Speaker, there is a silent crisis ongoing in our country that this Government does not seem to be aware of. I am speaking of housing, aging buildings, low vacancy rates in almost every major city and hald a million Canadians unable to afford decent housing. The victims in this crisis are too often women, single mothers and elderly women on low incomes. Yet, this Government has cut the Budget for CMHC and this has far-reaching impact.

One Canadian woman out of ten is battered. Last year, the Canadian Mortgage and Housing Corporation gave funds to start only 11 shelters with a total of 129 beds. There are presently in Canada only 190 shelters and three projects for the next stage, Mr. Speaker, you are well aware of the Badgley and Fraser reports which were tabled and which emphasize the need for these shelters. More than 500,000 Canadian women
May 24, 1985

are victims of family violence. The Mulroney budget concluded that $26 million from the CMHC suited their needs perfectly.

Let me speak about federal transfers to the provinces, Mr. Speaker. There is another important part of the Budget that will have far-reaching impacts for women and youth in Canada. I am referring to the Government's intention to deindex federal transfers to the provinces and further to reduce such transfers by $2 billion by the end of the decade. So much for the Prime Minister's co-operative federalism.
The real danger is that this federal action will put increasing pressure on the provinces to take a hard look at how they are going to finance such programs as transition homes for battered women, welfare payments, medicare and university tuition. These are the kinds of hidden and sneaky cuts that this Budget is really all about. They are the kinds of cuts which show the true priorities of the Tories.
I could deal with child care and child benefits. I could tell you that I feel terrible that there was nothing about daycare in
The Budget-Mrs. Finestone
the Budget. Last and most important is our youth. This cutting of job training and the abandonment of direct job-creation efforts have bitterly disappointed the youth of Canada. The Canadian Federation of Students called me-


The Acting Speaker (Mr. Charest):: Order, please.


George Albert Proud: Mr. Speaker, if there is unanimous consent, the Hon. Member for Mount Royal (Mrs. Finestone) could continue.


The Acting Speaker (Mr. Charest):: Is there unanimous consent?


Some Hon. Members:: No.


The Acting Speaker (Mr. Charest):: It being five o'clock, the House stands adjourned until Monday at 11 a.m., pursuant to Standing Order 2(1).
At 5 p.m. the House adjourned.

Monday, May 27, 1985