1993-04-27

[Stage Direction]
[English]	CANADA GRAIN ACT
EXTERNAL AFFAIRS AND INTERNATIONAL	MEASURE TO AMEND
TRADE NINTH REPORT OF STANDING COMMITTEE	Hon. Pierre Blais (for the Minister of Agriculture) moved for leave to introduce Bill C-127, an act to amend the Canada Grain Act.
Mr. Pat Sobeski (Cambridge):: Mr. Speaker, I have the honour to present, in both official languages, the ninth report of the Standing Committee on External Affairs and International Trade. In accordance with Standing Order 108(2) the subcommittee on international trade of the Standing Committee on External Affairs and International Trade has examined the North American free trade agreement and wishes to report its findings to the House.	The Acting Speaker (Mr. DeBlois): Pursuant to Standing Order 68(2), the motion is deemed adopted. Mr. Blais (for the Minister of Agriculture) moves that the bill be now read the first time and printed. Pursuant to Standing Order 69(1), the motion is deemed adopted. Bill read the first time and printed.

April 27, 1993
Routine Proceedings



GROSSE ILE HISTORIC SITE PROTECTION ACT


Mr. Mike Breaugh (Oshawa) moved: for leave to introduce Bill C-423, an act to protect and enhance the historic site of Grosse lie.


The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 68(2), the motion is deemed adopted.


Michael James Breaugh: Members may know that this has been the subject of hearings across Canada. Many people in the Irish community are very concerned, not that the Government of Canada will not develop this site but that it be done in a proper way, acknowledging the contribution and sacrifices made by Irish immigrants, particularly those who are buried on the site known as Grosse fie.
This strikes me as a reasonable way to proceed. Those who have some concerns on the matter will feel their concerns have been heard and protected and that this national historic site will remain forever a part of Canada, an ongoing monument to those Irish who died during the great famines.


The Acting Speaker (Mr. DeBlois):: Mr. Breaugh moves that the bill be now read the first time and printed.
Pursuant to Standing Order 69(1), the motion is deemed adopted.
Bill read the first time and printed.



IMMIGRATION ACT


Mr. Dan Heap (TVinity-Spadina) moved: for leave to introduce Bill C-424, an act to amend the Immigration Act.


The Acting Speaker (Mr. DeBlois):: Pursuant to Standing Order 68(2), the motion is deemed adopted.


Daniel James Macdonnell Heap: Mr. Speaker, the purpose of this bill is to bring the Canadian Immigration Act up to date with current opinion in Canada and in the world but in which Canada may be a world leader.
In the past the immigration laws of the United Nations and of Canada reflected mainly the situation of men who were engaged in political activity or were religious leaders and were persecuted. Now it is becoming evident that women in some cases are persecuted because they are women.
This bill amends our Immigration Act so that it adds a sixth ground of recognized persecution. In addition to race, nationality, religion, membership in a particular group or political opinion, it would now read that a person may be found a refugee by reason of a well-founded fear of persecution for reasons of race, sex, religion, nationality, membership in a particular social group or political opinion.


The Acting Speaker (Mr. DeBlois):: Mr. Heap moves that the bill be now read the first time and printed.
Pursuant to Standing Order 69(1), the motion is deemed adopted.
Bill read the first time and printed.


PETITIONS
Miss Deborah Grey (Beaver River):: Mr. Speaker, I rise today pursuant to Standing Order 36 to present thousands and thousands of names on a petition signed by people not just in Calgary but across western Canada in memory of young Ryan Garrioch who was brutally murdered on a school playground last May in Calgary.
They are drawing the attention of Parliament to the following: that the majority of Canadians support equal treatment of criminal offenders but with legislated aid shelters from criminal law for very young adolescents and that chapter 15 of the charter of rights guarantees equality rights.
Therefore these thousands of petitioners-and there are more to come on behalf of this family who is mourning-are requesting that Parliament revise the laws of Canada to replace the Young Offenders Act with an updated Juvenile Delinquents Act with a lowered maximum age of 13 years.
April 27, 1993


Deborah C. Grey: Mr. Speaker, I would also present, pursuant to Standing Order 36, a petition signed by several people in western Canada.
Planned Parenthood, a special interest group is seeking government funding for a project known as SIRCH, which stands for sexuality, information and a resource clearing house. These funds of course come from the taxpayers and the citizens of Canada. Such a clearing house including a national depository collection, centralized reference and resource service, and a national toll-free line already exist through the national education organization, Alliance for Life.
The petitioners pray that Parliament will find that SIRCH is an unnecessary duplication of services. The undersigned in this petition humbly call upon Parliament to withhold all financial support from Planned Parenthood and the SIRCH project.


Mrs. Shirley Maheu (Saint-Laurent-Cartierville):: Mr. Speaker, pursuant to Standing Order 36, I have the honour and privilege of presenting petitions on behalf of Canadian senior citizens who have lost a great deal of confidence in this government.
The petitioners call upon Parliament to take all necessary measures to entrench in the Constitution the obligation for the government to ensure publicly financed universal medical and health care systems.

I wonder if this government has the courage to take a step for our seniors.


Mr. Jim Jordan (Leeds -Grenville):: Mr. Speaker, the petition I am presenting this morning has about 4,400 names on it. It was initiated by a group of college students in my riding.
It was started when one of their classmates was killed in a tragic traffic accident a few weeks ago. It is asking the government to arrange its priorities differently.
Routine Proceedings
The student who lost her life was Deborah Utman. She was one of 24 people to die tragically in the past few years on that 40-kilometre stretch of highway leading from Highway 401 into the nation's capital.
Through this petition people living in the community served by this highway are asking this government to move on it and start a dialogue immediately with the Ontario provincial government for the completion of the highway into four lanes.
Of course the primary concern is the saving of lives. Of secondary importance would be the economic impact that the construction of that highway would have on the capital region and indeed all of eastern Ontario.
It is an honour to present this petition on behalf of my constituents.


Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, older citizens of my community have deposited, according to the normal procedures of the House through Standing Order 36, the following resolution. They consider universal medical care a fundamental element of the Canadian identity. They indicate that recent budgetary costs have had a serious impact on their health and have undermined the principles of universality.
These petitioners, these older citizens who have paid and wish to continue to pay and to benefit, have asked the government to take all the necessary measures so that within the Constitution of Canada there will be this obligation by governments to assure to all citizens that hospital and health care remain a universal principle by the state.


Daniel James Macdonnell Heap: Mr. Speaker, it is my duty and pleasure, pursuant to Standing Order 36, to present a petition from over 100 residents of Toronto, York, Welland, Bond Head, Port Robinson, Kleinburg, Newmarket, Scarborough, Uxbridge, Sunderland, Willow Beach and Holland Landing.
These residents of Canada undersigned are concerned with the negotiations for a North American free trade agreement which they say will result and has already begun to result in even greater trade concessions being demanded of Canada, threatening even more good Canadian jobs.

Routine Proceedings
It will also place restrictions on the ability of Canada's federal, provincial and territorial governments to assist industry to conserve Canadian natural resources for Canadians and to advance the social programs we need. The free trade agreement cannot be remedied through negotiation. The petitioners point out that there will be an election before Januaiy 1, 1994 when the free trade agreement is scheduled to come into force. Therefore they call on this House to reject the proposed North American free trade agreement and to recommend to the government that it use the termination clause to end the Canada-U.S. Free Trade Agreement.


Mr. Dennis Mills (Broadview-Greenwood):: Mr. Speaker, pursuant to Standing Order 36 I have the privilege of presenting these petitions signed by not only my constituents but by people from all across the Toronto region.
The petitioners humbly pray and call upon Parliament to accept legislation designed to eliminate violence against women and children. They want to encourage and support women to report incidents of assault or abuse and provide relief and support to women as mothers to protect their children.
They want to emphasize the need for abuser rehabilitation and they want to concentrate special effort on the training of police, lawyers, court workers and judges to become knowledgeable about women and child abuse and to focus public attention on this very important and long ignored problem.


Mr. Ronald J. Duhamel (St. Boniface):: Mr. Speaker, the students from the University of Saskatchewan who reflect the views of students from across Canada have asked me to present this petition which I do with a great deal of pleasure.
The petitioners condemn the goods and services tax on books and reading materials. In their opinion, the goods and services tax on books and learning materials has harmed publishers, bookstores, libraries, students and writers.
They ask the government to review its policy and rescind it.


Ron J. Duhamel: Mr. Speaker, I have another petition.
This is really the government's last chance because there will be a vote on this item today to delay the proposed merger of the Social Sciences and Humanities Research Council with the Canada Council.
These petitioners point out that Canada's most challenging problems are in the social sciences area. There are questions such as unemployment, poverty, et cetera. Without a vital Social Sciences and Humanities Research Council we could and will be at a disadvantage. Again, they ask the government to defer its decision.

I think this is a very reasonable request.


Mr. Maurice Foster (Algoma):: Mr. Speaker, I have the honour to present a petition signed by some 175 constituents of mine from Manitoulin Island. They are from such places like Gore Bay, Ice Lake, Mindemoya, Little Current, Spring Bay and Providence Bay.
These petitioners are calling on the government to maintain the manned weather station at the Gore Bay-Manitoulin airport. They point out that this has implications for safety at the airport. The staff at the weather station not only operate the weather station but they are also involved in areas of the operation of the airport itself relating to security, fuel sales, radio operation, scheduling of air flights, air ambulance, search and rescue, runway and beacon lighting.
We are not only dealing with five permanent jobs but also the operation of the airport and the long-term viability of that community as regards transportation and tourism.
These constituents of mine call on the government to retain and maintain the staffed weather station at the Gore Bay-Manitoulin airport.


Mr. Nelson A. Riis (Kamloops):: Mr. Speaker, it is my honour to present a petition on behalf of a number of residents of Kamloops, British Columbia who point out their disappointment that the government used a form of
April 27, 1993

The Budget
closure to limit the debate on the North America free trade agreement to less than five hours at the second reading stage. That is where we discuss the legislation in principle.
They point out that water is not an area of exclusion within the North American free trade agreement. They point out that raw logs are exempt, that unprocessed fish on the east coast of Canada are specifically made exempt but water is not.
The petitioners point out that at the moment there is a project where the backers intend to divert part of the North Thompson River and eventually sell that water in southern California. They are very concerned in terms of the ecological impact of this type of water diversion plan. They are asking that the Canadian government make water an exclusion from the free trade agreement so that our Canadian rivers and lakes will be saved for future generations here in Canada.


QUESTIONS ON THE ORDER PAPER
Mr. Charles A. Langlois (Parliamentary Secretary to Leader of the Government in the House of Commons and to Minister of National Defence):: Mr. Speaker, I ask that all questions be allowed to stand.


The Acting Speaker (Mr. DeBlois):: Is that agreed?


Some hon. members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Monday, April 26, consideration of the motion of Mr. Mazankowski that this House approves in general the budgetary policy of the government.
Hon. Herb Gray (Windsor West):: Mr. Speaker, when I moved the adjournment of the budget debate yesterday I described this budget as a white flag being raised by all the members of a tired Conservative government in
surrender to a jobless recovery, a jobless economy. Perhaps I should have called the budget this government's shroud because this is surely the last will and testament of a dying government.
In this budget there is nothing for the unemployed, nothing for our young people entering the labour force hoping for a future. In fact the Minister of Finance is projecting unemployment at or near to 11 per cent well into 1994, a message of despair for the 1.5 unemployed Canadians and their families.
On page 21 of the budget papers themselves the Minister of Finance admits that unemployment will be high right through 1998, five years from now. Here is what the budget papers say:
The medium-term projection underlying the fiscal plan is based on
the assumption that some excess capacity in labour and product
markets will remain through 1998.
Underneath this convoluted Department of Finance language the meaning is clear. There still will not be enough jobs five years from now for Canadians if this Conservative government stays in office, but I am sure this is not something Canadians will allow to happen.
Before he brought down his budget the Minister of Finance in effect admitted that putting Canadians back to work would not be his primary focus. He claimed that the deficit was his number one economic enemy.
Canadians are going to think that sounds rather strange coming from this Conservative government. Is this not the same government that said when it was first elected in 1984 that the deficit would be its priority? Is this not the same Conservative government that for the last nine years brought in deficit after deficit all in the $30 billion area? Is this not the same government that over these same nine years piled up more public debt than all previous governments since Confederation? I think so, Mr. Speaker, because there was an accumulated debt of $168 billion approximately by 1984, accumulated in the 117 years since Confederation. However, in only nine years of Conservative government, of Conservative fiscal mismanagement, that debt ballooned to $458 billion. Yet the Conservatives are the people who say they know how to run this country's affairs.


An hon. member:: What a laugh.


Herbert Eser (Herb) Gray: What a laugh, someone said. Canadians have tragically learned that is not the case.

April 27, 1993
The Budget
Even after bragging last week about how his budget was going to fight the deficit, the minister when presenting his budget papers was still forecasting in them that the deficit would be $35.5 billion this year.
Even after five more years under his so-called deficit reduction plan the minister says there would still be a deficit left of $8 billion. Over that same period he plans, the Conservatives plan, to add over $100 billion more to the public debt bringing it to $563.2 billion by 1998.
Under this Conservative government more and more of Canada's debt is held by foreigners leaving us increasingly vulnerable to outside pressures. The government knows this. On page 26 of the budget the Minister of Finance admits that Canada's foreign indebtedness has not been as high since 1961. As I said last night, that was during the last period of long-term Conservative government when the Prime Minister was the Right Hon. John Diefenbaker.
When I pointed that out yesterday our present Conservative Prime Minister doubted this could be so, but here it is in black and white, right here in the Conservative budget and budget papers. This Conservative government and the present Prime Minister have beaten the record of the last Conservative government to the detriment of the Canadian people.
In fact the deficit for 1992-93 is $8 billion higher than this Minister of Finance said it would be in his February 1992 budget and $1.1 billion higher than he said it would be only last December in his economic statement. These guys really know how to forecast. Is that sound fiscal management? I do not think so and Canadians will not think so either.
I am sure that no Conservative members will be as disappointed with this Conservative deficit non-plan than the Minister of National Defence who said she could eliminate the deficit entirely in five years and the Minister of the Environment who then upped the ante saying that he could do it in only four years.
How are these ministers going to reconcile their leadership campaign promises with the Minister of Finance's budget? Will they vote against it because it does not meet these leadership promises? Or will they
vote for it and acknowledge when it comes to fiscal realism they do not know what they are talking about? After all that is what the Minister of Finance in effect said himself about these two colleagues when he forecast yesterday a budget deficit of $8 billion, not zero but $8 billion five years from now.
If this budget is not believable when it comes to deficit control, exactly what does it do? Well it certainly does not set priorities. The Minister of Finance who wants to be known as "Maz the Knife" has said he is four square behind spending $5.8 billion on unneeded high-tech military helicopters which were planned for during a cold war that fortunately ended years ago.
His plan and the Conservative government's commitment is to spend this $5.8 billion at a time when in this budget the government is cutting funds for social housing, for low-income housing, for regional development and is even taking away the January GST rebate cheques from lower income Canadians.
Why is it that after all the talk, the hype, the sales pitches, the Conservatives have failed by their own admission to meet their own objective and bring the deficit under control? It is because they just do not get it. They fail to recognize that meaningful deficit reduction can only be expected when there is strong economic growth and strong increasing employment.
The Minister of Finance and the Conservatives admitted in the budget that government revenues have been weak and would continue to be weak for years under their projections. Why is this? It is because of a continuing weak economy and slow economic growth. The Tories have failed to realize that the deficit, employment, economic growth, inflation and taxation are all interrelated. What is required is a set of co-ordinated and balanced economic policies.
This is exactly what the Conservatives have not given Canadians over the past nine years. There is no doubt the deficit is a problem that must be dealt with. However, any fiscally responsible economic strategy must have two tracks. This is the Liberal approach, the Liberal plan.
The first track involves expenditure control through streamlining government and eliminating duplication while delivering the services that Canadians need. This
April 27, 1993

must take place, we believe, in consultation and not in conflict with the provinces. In addition, the federal government must hold off on new programs that do not contribute to economic growth and job creation.
On the second track at the same time governments must foster economic growth and job creation. This means investing in people, research and development and infrastructure. When people are working it means higher government revenues without their having to pay higher taxes. At the same time governments do not have to spend on unemployment insurance and welfare.
Studies have confirmed that the one million Canadians who are unemployed cost the federal government more than $20 billion, likely $25 billion each and every year they remain out of work. If one million Canadians could be put back to work, it would free up $25 billion which could be directed to other productive purposes. This means these people would be put back to work. That is something for which the Conservatives have no plan. It is something for which the Conservatives have no commitment.
People often ask what government spending we Liberals would like to cut. By way of example, I have already mentioned the $5.8 billion military helicopter program. That is one area. I would also like to see a substantial cut in the $19 billion the government spends on unemployment insurance, not by cutting benefits but by putting people back to work.
Someone once said that to govern is to choose, but this Conservative government has a mania for making bad choices. For example, the Conservatives have no plan for jobs and growth. However, they do have a detailed plan for a multimillion dollar unnecessary farewell trip to Europe by the current Prime Minister. The Conservatives announced no plan for growth and jobs, but the Prime Minister's office has just announced all the details, the full agenda for the multimillion dollar farewell trip by the Prime Minister.
The egomania of the Prime Minister is more important than jobs for Canadians. Surely that cannot be right. Canadians can and will make sure that the next election will also be the farewell trip for the new Conservative leader and the Conservative government as well. We are going to have two farewell trips, one by the present Prime Minister and during the next election the farewell trip for his successor as well.
The Budget
In my own city of Windsor and in cities just like it across this country, people have been devastated by Conservative policies that have brought recession and unemployment. Policies like the GST and the trade deals have closed factories and produced hundreds of thousands of bankruptcies.
People in my community feel they have done more than their share in bearing the burden of these Conservative policies. I think people in my community and communities like it right across this country would be prepared to do their share as part of a plan to help get this country moving. However they see no such plan for recovery and growth in this budget or in anything the Minister of Finance or the Prime Minister, or those hoping to succeed him, have had to say so far or are likely to say.
In the budget documents the government admits that even in 1998, five years from now, if there is still a Conservative government it expects to be spending $18 billion a year on unemployment insurance. That is only about $1 billion less than it is spending today. That is hardly a vote of confidence by this Conservative government in its own capacity for economic management.
As the Leader of the Opposition told Toronto's Empire Club on February 11 of this year, fostering economic growth does not mean new federal spending to finance our future. It does mean changing priorities and investing in that future. Without the Liberal two-track approach to deficit reduction and economic growth, any efforts to balance expenditures and revenues will prove futile at best and counterproductive at worst. Meanwhile the stagnant economy will continue. It will continue unless this two-track approach becomes the foundation of a new economic plan for Canada.
The fact is that neither this budget nor any of the Conservative leadership candidates have provided a realistic vision, a plan to achieve the twin objectives of fiscal responsibility and strong economic growth.

Unlike the Conservative Party and the New Democratic Party, the Liberal Party developed an economic policy which will really prepare the Canadian economy for the 21st century.

April 27, 1993
i- *

*
Translation]
The Budget

For Liberals the ultimate objective of economic policy is to build a value-added economy that will create permanent jobs for Canadians and protect and enhance our social fabric. This means providing Canadians with more jobs with a future in industries with a future.
To maintain high-paying jobs in the global economy Canada will need a work force second to none in skills and flexibility. In co-operation with the provinces, business and labour a new Liberal government would establish a national apprenticeship program and a Canada youth service, for example.
A new Liberal government would see technological innovation as a real opportunity for Canadians. It would pursue a research and development strategy that would enhance Canada's ability to finance, market, administer and diffuse our advanced technology.
A new Liberal government would revitalize the small business sector which is crucial to Canada's long-term economic health. It is this sector that will likely generate the most jobs for Canadians.
A new Liberal government would promote and pursue a global trade strategy and aggressively exploit the potential for export sales to growth areas such as the Pacific rim and Latin America.
A new Liberal government is committed to the concept of a true Canadian economic union, one that would eliminate provincial barriers to the movement of goods, services, capital and labour and create billions of dollars of additional economic activity for Canadians.
Liberals believe that with a national government that stands up for them Canadians can compete with the best in the world, creating new economic growth and opportunity here at home.
Yes, I would have to say that a new Liberal government alone cannot solve all of our economic problems. There is no single magical solution. However I believe that a new Liberal government will make an important difference, a real difference for the better for all Canadians.
In order to make this economic change, we will have to establish new partnerships with all stakeholders in this country-the private sector, the unions, the provinces, the municipalities, the voluntary agencies-and we will have to stop, once and for all, to pit these groups against one another, as the Tories have been doing for nine years.
In a recent speech the distinguished economist, Judith Maxwell, said:
A society that stops building for tomorrow gets stale and
deteriorates.
That is what has happened to Canada under the last nine years of Conservative rule. Conservatives have stopped investing in order to build for tomorrow. They have stopped investing in people, education, research and development. They have stopped investing in our country's infrastructure. They have stopped investing in the building blocks of a prosperous and competitive economy. As a consequence of the Conservatives not investing in our future, the Canadian economy continues to falter and our high standard of living, perhaps a lot less high since the Conservatives got in, is at risk. The future of our children is at risk.
This Conservative government has failed to respond to the challenges of a new world economy. It has failed to put people back to work. It has failed to offer a real future for our young people. Conservatives simply do not get it. They simply do not realize what has to be done. They have forgotten, or they do not want to agree, as a very wise person said to me this morning, that for Canadians there is a society to be maintained, cultures to be encouraged and a country to be built. Instead of a crusade for a better and more prosperous Canada, the Conservatives have simply presented a budget that is an admission of defeat, a shroud for a dying government.
This is not a budget to respond to the economic and social needs of Canadians. Instead, unfortunately, it is a budget designed to respond to the political needs of the Tory leadership candidates. There is no plan in this budget to get the economy moving quickly forward again

April 27, 1993

and to create more jobs for the 1.5 million unemployed and the young people entering the labour force who are seeking a future and who deserve a future.
However the fact is that the needs of Canada for economic growth and jobs have to come ahead of the ambitions of the Conservative leadership candidates and their misguided expectation that somehow they will be able to perpetuate their years in office. These needs of Canada for economic growth and jobs must come first. However that will happen only once we have an election in which this tired Conservative government, even with a new leader, will be replaced by a new Liberal government, a Liberal government with a strong economic action plan and with the mandate to implement it.
I conclude by moving:
That the motion be amended by deleting all the words after the
word "That" and by substituting-
What amounts to a strong motion of non-confidence in this government.
-by substituting the following therefor:
this House condemns the government for presenting a shopworn copy of last year's budget that
-	fails to present a realistic and comprehensive program to create jobs and economic recovery to permit the millions of Canadians whose lives have been crushed by Tory policies to regain their hope and their livelihood,
-	fails to offer a credible and fair plan to control and reduce public debt and
-	fails to provide Canadians with a true and an accurate account of the eight and one-half years of Conservative government mismanagement".


The Acting Speaker (Mr. DeBlois):: The Chair rules the amendment moved by the hon. member for Windsor West to be in order.


Hon. Audrey McLaughlin (Yukon):: Mr. Speaker, yesterday's budget is clearly the budget of a tired government. In fact it is the budget of a bankrupt government that is leaving a country bankrupt.
It is incredible that we have a government that is leaving very shortly, and hopefully as quickly as possible when we have the next election, and is leaving this country in a situation in which there is the highest
The Budget
number of unemployed Canadians we have ever had, the highest debt and the highest number of bankruptcies. Nothing in this budget addressed any of those issues. Nothing in this budget gave hope to Canadians. A government without vision leaves a country without hope, and that is the legacy of almost nine years of Tory leadership.
The crisis we have in this country now is a fiscal crisis. There are those who say that the only way we can deal with the fiscal crisis is to create a human crisis. That is what this government has done. The human deficit of unemployment is incredible in this country. While the official statistics rest at 11 per cent, there are many studies that indicate one in four Canadians are either unemployed or underemployed and are seeking employment in this country, or better employment.
It is unbelievable that this government could stand up yesterday and present a budget to this House that was based on continuing unemployment of 11 per cent this year and further double digit unemployment in the next year. It seems that level of unemployment is acceptable to this government. One million children living in poverty is acceptable to this government, if we look at this budget. Hundreds of thousands of people using food banks is acceptable to this government.
Three years ago this House stood together and said that we would eradicate poverty by the year 2000 and this government chose to bring in its last budget which did not even acknowledge the level of poverty it has created in this country. It is a shame.
The government did have choices. Did it choose to do anything about jobs? No it did not. It chose to ignore the example of many of our trading partners, the United States, Japan and Europe, which have very recently introduced jobs plans, of investing in growth and developing a dynamic and modem economy to take us into the 21st century.
Why did this government choose to ignore the fact that our economy is simply not working? To the contrary, it continued with more of the same and said that the cure for the devastation it has created is more devastation. We on this side of the House, the New Democratic Party, say Canadians will not accept that, Canadians will not let the Tories get away with that.
There is one major reason that the Canadian economy is not working and it is that Canadians are not working.

April 27, 1993
The Budget
A recovery without jobs is no recovery at all. A future without jobs is a future without hope. That is unacceptable. It is a betrayal of the people this government is here to serve.
Is the government attacking the deficit? No. With a deficit of $35 billion this year and a deficit of almost $33 billion next year, this exercise is a failure. And why did the government fail? Because it has refused to stop wasting money and because it will not admit that the best way to reduce the deficit is to attack unemployment. The government could have cancelled the helicopter purchase, a deal that will cost the government nearly $6 billion for helicopters to be used to fight an enemy who, since the end of the cold war, no longer exists.
No, it chose to reduce unemployment insurance benefits, to reduce federal regional development grants and transportation subsidies for farmers. It preferred to reduce subsidies for institutions like the CBC, those institutions that unite and define us as a country.

The government had the opportunity to close tax loopholes to the powerful and wealthy and end the private family trust exemption that cost up to $600 million each year. It had the opportunity to cancel the business entertainment deduction that costs up to $1 billion each year.
It chose instead to make life more difficult for low income Canadians by reducing the number of times the GST rebate is received to twice a year from four times a year. I know that people who have jobs and those on the government side who are living quite comfortably may not understand the real life that many low income Canadians live. They may not understand that change will really cause a severe hardship to many families.
In addition, the government chose to cut development assistance to the world's poorest citizens and made drastic cuts to advocacy groups that generally speaking, on very limited budgets, give a voice to those who are less powerful in our society.
Let us look at what the government did in this budget. It made sure that any cuts made were to those with the
least power and the least voice. Those who were exempted from any sacrifice were those with the most: the rich, the powerful and those with private family trusts. Those revenues would have offset any savings by far.
This is a political budget and not a financial budget. The government made the political choice to really get the unemployed and the victims who feel powerless but it is not going to touch its friends who fund its party and will fund the next election. No, no, it is going to leave them alone.
Canadians know and want a government that stands on the side of all Canadians and not just one segment of Canadians. Mr. Speaker, as the leader of the New Democratic Party I say to you there is only one party that stands on the side of all Canadians and that is the New Democrats.
The reality is that the poorest fifth of Canadians own one-third of one per cent of the wealth in this country. The richest fifth of Canadians own 69 per cent of the wealth of this country. Have those in the richest one-fifth been asked to contribute, to sacrifice? No, they have not. Have they been asked to pay their fair share? Not at all.
Why not? As I said earlier it is because this government serves its friends. That is probably one of the saddest things for Canadians about this budget. Canadians did not understand it before but it is clear this government acts as a voice for private greed and not as a voice for public interest and the common good.
It is long past the time we had a government that could recapture that spirit of the public interest and common good in this country so all Canadians can benefit from the riches of our country.
Recently-I was flying back from my riding-I was sitting in the airport beside a couple of people who were discussing what they had been doing. They said they had taken their families to Europe skiing and were intending to travel a bit in Europe. They were looking forward to what they were going to do in the summer. At the end of that conversation they said they were very concerned that governments are not really cutting back social spending and health care.
April 27, 1993

The day before that I was sitting in a union hall in Faro, Yukon, in my riding where hundreds of workers are laid off and others are in danger of losing their positions. We sat and talked about the devastation to their families; the fact that labour laws did not protect them; the fact that these workers were last call on anything that might happen in terms of receiving their benefits and what was owed to them. They could not understand why a government would not protect the working people of this country.
The contrast between those two incidents is graphic. Once again I say that those who have the most are asked to pay the least. The working people who compose the engine that drives this country are asked to make the most sacrifices and are last in line when this government makes its policy and when it draws up a budget.


An hon. member:: Shame, shame.


Audrey Marlene McLaughlin: Unemployment is at 11 per cent and it is killing the Canadian economy. It is killing our productivity, our ability to grow and the hopes of many Canadians whether they are miners in Faro, auto workers in Ontario or fish plant workers in the Atlantic.
The OECD has determined that Canada has the largest gap between actual output and potential output of any major industrialized nation in modem history. That output gap translates into lost production of goods and services of more than $70 billion.
As I mentioned earlier, the other gap we have is between those who have the most and those who have the least. We are now spending $80 billion a year to provide services for those who are unemployed and in poverty. Let us attack that deficit. Let us attack the real deficit, the human deficit and also the financial deficit created by unacceptable unemployment rates. To not do so is insulting to those Canadians who are truly suffering across this country.
This morning I met with a group of farmers who really do not know what their future is going to be, yet surely there is nothing more basic than the sovereignty of food. The agricultural industry is both an important part of our economy and an important part of our own well-being. Yet they feel abandoned by this government and by Canadians. Surely this is the group we should be most
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concerned about in terms of our national well-being as well as our economic well-being.
Would it not be a change if we had a government that chose to act like a government, accepted responsibility for the people within its borders, stopped simply depending and hoping in some Disney-like fashion that if the economies of Europe, Japan and the United States improve then Canada will somehow be dragged along?
We are better than that. We have some of the most skilled workers. We have a strong agricultural community. We have men and women who are building this country into what they hope it can be. The government obviously does not have the least bit of faith in Canadians because its plan is to see if somehow Canada can get dragged along on the hopes of other countries.
Is it not time Canadians and the Canadian government stood up with pride and said they had ideas, initiative and spirit? We live in a country that looks outward to other countries but we stand proud and free. We can succeed because we have the people to do it.
We will never bring down the deficit and the debt unless we get Canadians back to work. We do not have to be economists to figure out that decreasing revenues are a direct result of fewer people working. The deficit is a symptom.
Let us take a moment to look at how the deficit was created. The government brought in a high interest rate policy, a high dollar policy, a bad trade deal and the GST all at the same time. It really led us down the path. It says it is a recession but it is not. It is a made-in-Canada depression and those one in four Canadians who are looking for jobs or looking for better jobs do not just see this as some vague kind of jobless recovery. They look to those in the government to stand up for them and say: "We care about you, we have a jobs plan to address this, we are going to do it, we have the courage, we have the guts and we are going to put it before Parliament," but not this government.
What about the projections of the government? Last year it missed its budget projection on the deficit reduction by about $8 billion and clearly again it was because of a shortfall in tax revenues.

April 27, 1993
The Budget
We need a government that will stand up and say it is not going to attack the unemployed, it is going to attack unemployment. It is about time.

I think we should remind the government of the following important equation: more people on the labour market means more tax revenue. More people on the labour market means that fewer Canadians will depend on the government to get by. Increased revenue combined with a drop in income support payments like unemployment insurance will reduce the deficit. The government has failed to understand this equation. And Canadians are paying the price. It is about time the government paid the price for its own incompetence, and that time will come on election day.

The government predicts a much rosier picture in terms of deficit reduction and unemployment four or five years down the road. The only good news is that it will not be there four or five years down the road.
This is the last budget of this Conservative government. Otherwise I would suggest it call in someone from The National Enquirer to develop its projections because it has about the same legitimacy. Sometimes The National Enquirer is actually much more accurate with its yearly predictions than the finance minister.
How do we get the economy moving and create jobs for Canadians? The Liberals have not offered any answers. The Reform Party's solution is to totally destroy the social foundation on which our economy is based.
We need a jobs plan in this country and only the New Democratic Party has presented a plan that will create 1.6 million new jobs over the next five years. According to independent analysis, it would bring down inflation and the deficit. It would not tax lower and middle-income Canadians further.
The government is right when it says ordinary Canadians cannot afford to pay any more taxes. We agree. After all it is this government that increased taxes on the average family by over $1,900 a year. It has devastated our economy with the GST and it is only fitting for the thief to recognize there is nothing more to steal.

The New Democratic Party has an economic strategy based on full employment, which will put the economy back on track. We have formulated the following specific proposals: a national infrastructure reinforcement program; a national daycare program; a national investment fund; investment in research and development; development of new technology; and fiscal and monetary policies that set a priority on job creation.
Our plan would end bad trade deals that have cost Canadians thousands and hundreds of thousands of jobs. It would introduce a fair tax system where the rich and large corporations finally pay their fair share.
This is a tired government. We understand. We are tired of the government too. It is a bankrupt government. It is a government without vision. Its way is not working. That is the bottom line. Its way does not work and we do not need more of its way which does not work for Canadians.
Unemployment at these levels cannot be sustained. It is a human waste. It is an economic waste and it is a national shame. The source of that shame, the Conservative government, must be defeated.
This country is capable of great things but we cannot in the budget presented by the Minister of Finance see anything great. There is more to this country and there is more hope for Canadians than this government has offered.
This government in nine years has destroyed this country. We in the New Democratic Party say, call that election. You will get the message from Canadians and New Democrats will help to build a new, better and more prosperous Canada.


Some hon. members:: Hear, hear.


Dennis Joseph Mills: Mr. Speaker, I listened attentively to the remarks of the Leader of the New Democratic Party.
Part of her remarks I actually agreed with in total. The concern that I have has to do with small business. We all know the greatest hope for new job creation lies with the small business sector in this country.

We have home based businesses, small businesses where people might employ only three, four or five people. There are close to 1.3 million such businesses in Canada. They are finding it very difficult to get access to capital.
The financial institutions in this country are just not playing ball. The government made a commitment to all of us in this House a few months ago that the Small Businesses Loans Act would be the financial instrument to put capital back into the hands of the small business sector.
The government made a commitment that it would promote that bill. It has not lived up to it. This sector to me is our greatest hope. I did not really get a sense, and I say this respectfully, from her remarks that that sector was getting support. I would like her to deal with that.
I would like to know what the New Democratic Party would do to try to make the banks wake up and realize that in addition to finding money for the Reichmanns, the Bronfmans, the Campeaus and a lot of other developers in this country, they should take the time to go out and make small business loans which are the source of this new job hope.


Audrey Marlene McLaughlin: Mr. Speaker, the hon. member raises a very important question. As he well knows, being very familiar with this, small business creates about 80 per cent of the new jobs in our economy. Therefore there must be a lot of attention paid to this.
The member is quite right. It has certainly been my experience across Canada that access to capital for small business for new initiatives and in some cases for continuing initiatives is very limited.
In a lot of areas but particularly in rural areas, in areas outside central Canada, it is often more difficult. That is why seeing the government reducing regional development funding is incredible. Some of that regional development funding of course would go directly to small business.
It is also quite incredible in this time of depression and recession when one sees that one of the major banks in Canada over the last two years made $1 billion profit.
It would seem to me that a government interested in small business would bring bank presidents together, would begin to talk about this and would begin to
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implement policies that would under the Bank Act make loans to small business, obviously ones that were accountable and feasible, as a real part of banks' responsibilities to this country.
I would say also that in the New Democratic Party's jobs plan we propose a national investment fund. The idea of that fund is specifically directed to the member's point about encouraging small business, in making sure that private funds, public funds and regional funds directed by regional boards are directed to investment in just exactly those kinds of enterprises that are appropriate to each region of the country. I think we have seen that a highly centralized system of encouraging regional development often does not work because the people of that area who obviously know the most about that area both in economic terms and in a business sense have not been the ones that have been able to make those decisions.
There are also many changes that can be made to reduce the paper burden on small businesses. I am sure anyone in this House who has either been in small business as I have or others will know that the GST has phenomenally increased the administrative burden, pa-raticularly for smaller businesses.
That is why we in this party propose to eliminate the GST over a period of time. We feel this would put more money in the hands of consumers. It would reduce and make the business climate more favourable specifically for small business and it would create jobs as has already been indicated by the Canadian Federation of Independent Business.
I am certainly in agreement with the member that small business must be the real focus of any plan for the economy. I look forward to seeing the Liberals' plan for small business when they have a plan.


Hon. Jean Corbeil (Minister of Transport):: Mr. Speaker, I am very pleased to speak today in support of the budget that my colleague, the Minister of Finance, presented yesterday.
It is interesting that the budget comes at the same time as spring. I see a lot of symbolism in that because, as everyone knows, spring in Canada always brings with it a feeling of optimism and dynamism. This budget will give Canadians what they need for new growth, new jobs and renewed prosperity.

April 27, 1993
The Budget
Of course, success never comes without effort. As Corneille wrote in Polyeucte, "Do we have to win so many times before we triumph?" Canada has had to face so many economic and financial challenges in the last several years that it seemed at times as though we would never get there and would always have to start over.
Today we see that these efforts were not in vain. The budget presented by my colleague, the Minister of Finance, clearly shows us that we were right not to doubt and not to give up but to follow his lead he gave us with the unconditional support and unshakable determination of our Prime Minister, the Right Hon. Brian Mulroney.
I would like to talk to you today about some measures in the budget which I think are particularly important and of some effects that the budget will have, especially in the department for which I am responsible, the Department of Transport.
The first objective of the 1993 budget is our number one priority: freeing the Canadian economy so that it can grow and create the jobs we need. For that, we must lighten the burden our economy and our people are saddled with as a result of the deficit and the debt.
During his pre-budget consultations, the Minister of Finance found an unprecedented concern over the excessive borrowing and spending habits of federal and provincial governments.
Canadians definitely want less government borrowing, lower taxes, more jobs and greater choices for the future. Canadians saw what happened when governments acted as though they could add to the debt indefinitely. Taxpayers pay more and more to receive less and less service from the government when interest payments take a growing share of every dollar in tax revenue. Higher and higher taxes slow down the economy, and reduce economic activity, decrease growth and employment.
The 1993 budget answers these concerns by considerably tightening the spending restrictions presented in the economic and fiscal statement of last December. In its main proposals, the budget first imposes no new taxes; second, saves over $30 billion in spending reductions and other measures that will be implemented over the next
five years. This means that the government will restrict the growth in program spending; that is, there will be no real growth in spending, not counting interest charges on the public debt. Third, it is reducing the cost of the federal government by streamlining its activities, reducing the regulatory burden and improving efficiency.

The goal of the budget, the Minister of Finance said, is to free the economy for more job creating growth by steadily reducing the burden of deficits and debt. Transportation is not immune from such a balancing exercise. Fiscal restraint must be shared by all Canadians.
However, Canada is a trading nation and transportation will remain a cornerstone of our economic well-being. The government has recognized the importance of transportation infrastructure in guaranteeing our future economic prosperity. Indeed, the diverse nature of Canada's economy places ever-increasing importance on a safe and efficient transportation system that will allow us to meet the growing challenges of the new global economy.
Major new strategic capital investments in Canada's national transportation and communications networks are under way. Agreements have been signed with five provinces to improve hundreds of kilometres of highways and to create many thousands of jobs. An additional
15,000	person-years of employment are expected to be provided from further projects to be announced in the weeks and months ahead.
These transportation improvement initiatives are being funded out of savings from last year's budget and the December economic and fiscal statement. The measures have been implemented and they are working.
I do not need to underscore the importance of the highway network in Canada. Canadians make around 90 per cent of their trips by car and bus. Close to 60 per cent of freight traffic moves by truck. Recent studies have demonstrated that certain sections of the national highway system do not meet the increasing needs of highway transport. This situation creates safety problems and results in congestion and delays for travellers and commerce. Millions of dollars are lost each year when travellers and freight are tied up in traffic jams.
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The Government of Canada has recognized this and has invested strategically in the construction and maintenance of highway infrastructure which will generate important benefits in terms of improved safety and economic growth.

As for the equipment used by Transport Canada to carry out its mandate, we will examine the possible benefits of privatizing our helicopter fleet. We will also take a thorough look at the fleet and aircraft service activities to determine the most economic way to provide the service. A pilot project will be implemented to use private sector resources for flight inspection services in Western Canada, provided technical accuracy can be assured. International experience has proven that the private sector can provide similar services more efficiently and economically, while maintaining high safety standards.
In the area of subsidies for transportation and agriculture, the grants and contributions provided in the Western Grain Transportation Act, the Atlantic Region Freight Assistance Act and the Maritime Freight Rates Act will be reduced by 15 per cent in 1995-96 and 20 per cent in each of the following two years. This has already been the subject of several discussions with the appropriate authorities.
Services have been rationalized and VIA Rail's operating budget will be reduced by $50 million in 1995-96 and by $100 million for each of the following two years. Although I expect there will be a strong reaction to this initiative, VIA Rail has already demonstrated a flexibility and determination beyond what had previously been predicted.
Responsible sound management and corporate restructuring have allowed VIA Rail to fulfil its mandate and even to cut its dependence on government funds further than expected while continuing to provide first class rail passenger services across Canada. VIA Rail's restructuring was necessary due to its spiralling financial requirements which led to our decision in 1990 to reduce its funding by half. This in turn led to a 50 per cent reduction in VIA Rail's services.
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During the three years since the reduction, VIA Rail has been able to improve its performance substantially. It has managed to provide transcontinental corridor and remote services at funding levels below those authorized by the government. As well, its service to the public has improved. Its on-time performance now exceeds 90 per cent and most of its trains are now equipped with LRC equipment or rebuilt cars.
In 1992 VIA Rail was able to increase its train frequencies on the Montreal-Ottawa-Toronto routes without any increase in its need for resources. It will take VIA Rail some time to analyse the impact of the cuts on train services and the corporation's work force and to prepare a strategy for its new commercial mandate. We expect an announcement on the impact on train services in late 1993 or early 1994.

These measures, together with the many others detailed in the budget, will maintain the 1993-94 deficit at the projected level of $32.6 billion and will considerably reduce the federal deficit in the next five years, as the recovery now under way strengthens.
By 1997-98, the government will end all new borrowing, both in Canada and abroad. Interest payments on the debt will decline to 26 cents per dollar of revenue, compared to 36 cents in 1990-91. The deficit will be reduced to $8 billion, less than 1 per cent of national revenue, compared to 5.1 per cent in 1991-92.
With the measures to stimulate the recovery in the budget of February 1992 and the economic statement last December, the Canadian economy has created over
200,000	full-time jobs since last August.
We are now in a good position to gradually improve our economic performance; our real growth will be nearly 3 per cent in 1993 and over 4.5 per cent in 1994, while inflation and interest rates will remain low.
More than ever, Canadians want their governments to co-operate for the sake of economic prosperity and international competitiveness. They want a national solution to the national debt problem and want governments to act without delay. The Minister of Finance has already invited his provincial and territorial counterparts to Ottawa in late May to begin working on this.

April 27, 1993
The Budget
With the 1993 federal budget, the government has a responsible and achievable plan to restore the nation's finances and strengthen our economy's ability to create jobs.


Mr. David Berger (Saint-Henri-Westmount):: Mr. Speaker, I want to discuss the issue of the deficit, which was raised by the Minister of Transport. The minister said in his comments that the burden imposed by the deficit and the debt had to be alleviated, thereby implying that the government had managed to do so, when in fact it is the opposite, as we well know.
The government failed miserably on this issue, and I wonder if the minister recognizes the magnitude of this failed attempt.
The minister knows full well that the deficit for the year which just ended last March 31 will be of the order of $35.5 billion. He also knows-if he read today's newspapers-that nobody believes the economic forecasts contained in yesterday's budget. We are told that real growth will reach 4.5 per cent in 1994. The government is dreaming in colour.
During the eighties, there was significant economic growth because of the strength of the American economy and the strength of growth and consumption in Canada. However, I want to emphasize that nobody believes that the recovery in the United States will be as strong this time as it was in the eighties, and I also want to refer to one of the indicators mentioned on page 42 of yesterday's budget. For the current year, the government anticipates an increase of only 0.5 per cent in the personal income of Canadians, while the population will grow by about 1.5 per cent. This means that Canadians will suffer a net loss of income. Instead of having-


The Acting Speaker (Mr. DeBlois):: Order, please. The hon. member should either ask his question or conclude, because there are other members who want to ask questions.


David Berger: This means that Canadian consumers will have less money to spend this year. How can the minister justify his optimism, given these facts?


Jean Corbeil: Mr. Speaker, I think that my hon. colleague, like all hon. members of this House, will recognize that no one in the world has infallible means
of predicting what is going to happen in the years ahead. Everybody has their own prediction tools and it is always on that basis that all calculations are made.
I think that we are in very good company when we base our forecasts on those of such a reputable and absolutely impartial organization as the International Monetary Fund, which has been saying for months now that in 1993-94, Canada will have the highest growth rate in the world. We are basing our predictions and forecasts on such in-depth and reliable analyses as those of the International Monetary Fund.
The people of Canada must be absolutely delighted with what the Conservative government has achieved over the past nine years and what it is planning for the future, as compared to the statement the leader of the Liberal Party made in his riding of Shawinigan just last Sunday that, if elected, his party would try to bring the deficit down only to 3 per cent of Gross Domestic Product, while the measures we are putting into place at this time will reduce the deficit much more.
What is even more disturbing and disquieting for the population as a whole to realize is that not only did his party put this country thoughtlessly in debt the last time it was in power, but he is now proposing to maintain the deficit indefinitely at $25 billion a year. If ever there was one thing that should alert Canadians to the dangers that lie ahead if that party were to come back to power, it is this very statement by the leader of the Liberal Party.


Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, I have a question for the Minister of Transport regarding the cuts to VIA Rail and also to the CBC.
Back in 1981 when Jean-Luc Pepin was Minister of Transport he decided to cut VIA services by 19 per cent. At that time the now Minister of Finance led a Conservative Party task force across the country to find out the views of Canadians on the appropriateness of VTA Rail passenger services. The report he issued on behalf of his colleagues said in part: "The task force affirms that the federal government has a responsibility to ensure that rail services in Canada be retained, modernized and expanded as an important part of our national transportation system."
April 27, 1993

We know and the minister in his own comments reminded us of the 50 per cent cut in the subsidy level to VIA a little over two years ago. He pointed out that there will be further cuts. In fact, by the year 1997-98 the VIA subsidy will be $138 million.
The question I want to put to the Minister of Transport is, how can he expect VTA Rail to continue to operate outside of the Windsor-Toronto-Ottawa-Montreal-Quebec City corridor if that is the level of subsidy that is going to be available?
As he knows, the routes from Toronto to Vancouver, and the routes from Montreal to the Atlantic do not and never can pay their own way. Why has he and his government decided to put an end to VTA Rail? That is really what it amounts to. Why is he not prepared to invest in the national unity of this country to ensure that people can travel to see each other, to meet each other and to visit this great country? Why is the government doing that when it should be funding it properly and providing new capital services?


Jean Corbeil: Mr. Speaker, the hon. member refers to the period when Mr. Jean-Luc Pepin was Minister of Transport. If my memory serves me well, I think this was around the end of the 1960s or the beginning of the 1970s. About 25 years have gone by since then. I do not really keep very good records of when the Liberals were in office. I would prefer we forget that completely because of the legacy they left this country where we are now facing at both the federal and provincial levels almost a financial crisis situation.
Everybody who has been consulted over the past few months and years have said that we must address the question of the national debt and the national deficit. Otherwise we will have to very badly attack some of the essential programs this country must provide to its citizens.
We have demonstrated and VIA Rail has demonstrated since the cuts in 1989 that it can restructure and rearrange its services to provide an appropriate level of services to Canadians who want to use the train and at the same time live within their budgets. I have every confidence that it will continue to do so.
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Mr. Johnson:: Mr. Speaker, I rise on a point of order, I believe I heard a portable telephone ringing in the House a few moments ago. I did not see a member actually answer the phone.


An hon. member:: There it goes again.


Al Johnson: Mr. Speaker, I would appreciate it very much if you would clarify for the House that this is entirely inappropriate.
The reason I make the point is not to criticize the member particularly, but to remind everyone that members in the House are required to speak and answer on their own feet. If we allow such devices to be brought into the House, we are going to find ourselves in a situation where ministers will be answering questions based on answers given to them over the telephone by their aides and so on. We could entirely disrupt the order of-


An hon. member:: It is the lobbyists calling them telling them what to do.


Al Johnson: Yes, as my colleague says, we could end up with lobbyists calling in to tell members how they should speak. I think it is entirely inappropriate and I would appreciate it if the Speaker would clarify that it is inappropriate to have such devices in the House.


The Acting Speaker (Mr. DeBlois):: I simply want to state the obvious. To my knowledge, our parliamentary tradition and our current Standing Orders do not allow for the use of that kind of modem devices in the House. I think there is no need to dwell on that.
However, I must say that during a parliamentary visit to New Zealand, I was surprised to see all members of Parliament with a telephone on their desk. I do not believe that we have reached the same level of sophistication in the House of Commons of Canada. Anyway I will not dwell on that subject and I invite all members to be very cautious about that. It may happen from time to time that an hon. member forgets to turn his telephone off, but I invite you all to be very cautious. This House is clearly dedicated to direct parliamentary debate which takes the form of oral exchanges between members.

April 27, 1993
The Budget


Mr. Paul Martin (LaSalle-Emard):: Mr. Speaker, while I certainly agree with the point of order raised by the hon. member I would simply point out that indeed portable telephones might well improve the quality of answers coming from the minister.

It just proves that the government has completely lost contact with reality. For the second time in four months, the Minister of Finance intended to propose a supposedly growth oriented budget plan. Mr. Speaker, as you can see from yesterday's budget, the only thing that could be growing is the frustration of the Canadian people toward a government that refuses to take the necessary steps to give them hope once again.

This has not been a simple recession. We have gone through a fundamental restructuring of the world's economy, a restructuring that has been made worse in this country as a result of the monetary and fiscal policies followed by this government.
The problem is that we are not alone in this restructuring and it is the failure of this government to understand this simple fact that has led to its projections consistently not being met; $1 billion out in the deficit in the last four months, $8 billion out in the deficit in the last year, projections which have made this government the laughing stock of governments around the world.
We can live with that I suppose because its life is so short lived. Those who cannot live with this government's failures are the 1.6 million unemployed in this country, those who are on welfare, the ever-increasing army of the working poor. The Minister of Finance stands up here and talks of double-digit employment as if it is a simple statistic on a written page.
I would ask them to leave the written page and go into the real world. Come into my riding and see what it is like when families are broken up, see what it is like when young people are condemned to a decade of no jobs and suddenly begin to realize that the life for which they had such hope has disappeared before them.
There are four keys to job creation. The first is a lowering of our real interest rates, putting this country on a competitive basis with the rest of the world. In yesterday's budget the interest rates projected by this government continue for the next five years at historically high levels, far higher than our competitors, far higher than will make it possible for us to develop a competitive economy.
When one looks at the reactions of the world's financial community to this budget one must be fearful that interest rates will continue to rise and under those circumstances we will be plunged once again into recession. We will be plunged once again into a period of deflation while the rest of the world continues its restructuring and young Canadians begin to ask themselves if indeed there is a future for them in this country.
The second key is retraining. Nothing in this budget recognizes that the most important natural resources in this country do not lie buried deep in the ground. They lie in the skills and talents of those who walk upon it.
Research and development is the third key. This budget deals with research and development as tokenism. It talks of mechanisms, it talks of exploring, it talks of process but there is nothing concrete to enable Canadians to build an innovative economy. There is nothing in this budget that will allow us to take on both the Germans and the Japanese, those who are meeting the modern challenges.
There is no mention of environmental technologies, medical technologies and the great growth areas which are required if we are going to create the jobs of tomorrow.
Finally the fourth key is small and medium sized business. My colleague from Broadview-Greenwood has been so articulate in this House on the subject. What does the budget say about small business, that area of the economy which is creating 85 per cent of all the jobs in this country? It is virtually silent. Is it because small and medium sized businesses are Canadian-owned and that this government looks south for its economic direction and not within the heart and fabric of the Canadian nation?
The multinationals of tomorrow are today being created by two people in back sheds. This is happening right around the world and it is not happening in
April 27, 1993

Canada. That is why Canadians are losing faith. It is why they have lost faith with this government.
When the Liberals take power within the next three months-maybe four months depending upon when this government finally summons the courage to go to the Canadian people-we will once again give Canadians the tools and the confidence to rise to the challenges that lie outside our borders.

What is most astonishing in this budget is that, while Canadian taxpayers seem willing to directly address the deficit, the Minister of Finance instead served them a rehash, in a context so optimistic as to make everyone dream.

The 1993-94 budget is the last Tory budget.


An hon. member:: Thank God.


Paul Edgar Philippe Martin: Thank heaven.
It is also the last budget to be written according to the conventional wisdom of old style politics. The hallmarks of political budget-making are stamped on every page of this very lean document; dubious deficit forecasts, inflated economic assumptions.
This budget demonstrates the government's fiscal, economic and intellectual bankruptcy. For better or for worse the people of Canada are adjusting to very different economic circumstances. Every business, every volunteer group, every association in the country is coping with change. It is very clear-if there was any doubt of it before-after yesterday's budget that this government is not.
In the real world off Parliament Hill and outside the dynamics of the Tory leadership race that this budget was designed to comfort, a political revolution is under way. Canadians are demanding an end to the volleys of taxation that issue from the nation's capital every spring. They are demanding that governments cease their political fiddling while our prosperity burns.
In a thousand ways the central issue of our time, the reordering of the relationships between Canadians and their governments, is intruding on the business as usual world of politics and government; the rejection of executive federalism.
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The popular uprising against a British Columbia proposed homeowners' tax in March of this year and the massive unpopularity of governments from coast to coast all bespeak a deep and an urgent hunger for change. Canadians are demanding nothing less than an end to the political economy of governments that can neither follow the wishes of their citizens today nor bring before them the questions that must be decided tomorrow.
The challenge facing Canada is twofold. An immediate reordering of our public finances must be undertaken to avert a fiscal crisis. At the same time a reordering of the politics that underlie our financial problems must occur. The failure to meet either challenge will result in the failure to meet both.
Liberals propose to confront this challenge head on. Canadians must take full possession of the reordering of their public finances. There must be a new covenant between Canadians and the three senior levels of government. Growth strategies and mechanisms for their achievement must be arrived at. Plans for improving the cost efficiency of government services through a deep restructuring must be adopted. The tax structure must be reordered.
Again, my colleague from Broadview has been so articulate as indeed my colleague from London, those who really have brought forth a new vision as to how Canadians can govern themselves, can tax themselves and can bring themselves out of the depths of despair into which this government has unfortunately plunged them. A fundamental evaluation of the respective roles, the responsibilities and the powers of taxation of all three levels of government must be undertaken.
In the debates that take place between governments, why is it that the federal and provincial governments can seemingly continue to ignore municipal governments, those who are on the front line of social change? Why is it that they ignore the business community, the volunteer associations and the sole taxpayer who is at the bottom of this incredible pyramid of cost and efficiency led by this Conservative government?
Irregular taxation among jurisdictions has produced economic distortions, inefficient and wasteful collection costs and a perverse sense that the tax system is irrational and unfair.

April 27, 1993
The Budget
Canadians are prepared to pay their fair share of taxes. What they object to is when they see discrimination against them in favour of others. What they object to is when they see that the services that they have come to expect cut back and their taxes going up. There is a deep feeling that the system is warped against Canadians. Over the last nine years in fact that is the legacy of this government.
We will not solve the debt problem in this country without a national consensus on what it is reasonable to ask of the Canadian taxpayer and unless there is a consensus on how he or she is to be taxed.
We have a phenomenal opportunity to build one of the great countries of the world. The problems of this nation are not going to be solved by jargon and rhetoric. They are going to be solved by a nation which is able to achieve great things together.
The budget speaks to the government's economic plan. The budget sets out to the Canadian people the plan by which it sees them achieving this greatness, by which it sees them competing with other countries in the world whose economies are prospering. If that is the case and this budget is the best this government can do, what hope is there for Canadians?
Yesterday we were in the lock-up for four hours. I expected to be occupied. I read the document in 20 minutes. The government explained it to us in five minutes. In fact it did not even send in the departmental officials until the very end because there was not enough to explain.
Why did we have this budget? It was a non-event. Why did we have the last December statement? It was a non-event. Has this government run out of ideas and imagination?


Dennis Joseph Mills: All hype, no hope.


Paul Edgar Philippe Martin: All hype, no hope.


Mr. Arseneault:: Bankrupt of ideas.


Paul Edgar Philippe Martin: Bankrupt of ideas.
My God, we could do a better budget on this side in the next five minutes than that government has done in the last four months.

This budget is nothing more than the last wishes of a government that has decided to throw in the towel. This government has been promising us for almost nine years now that it would firmly attack the deficit. It has failed totally. The federal government and the provinces are now deeper in debt than ever before. And the saddest thing in all of that is that this budget will never be successful in reassuring international financial markets, which was one of the goals of this exercise.
Because he wanted to leave all options open to the next leader of the government, the Minister of Finance is jeopardizing the economic health of the whole country. Canadians have had enough of this mascarade. Young people on social welfare and the unemployed have had enough of this mascarade. We are wasting valuable time. The citizens of this country have the right to judge now. The curtain must fall on this government, and the sooner the better.

The time has come to let the Canadian people judge if what they want is the empty vessel served up by this government or a political party, a movement and a consensus which understands that we will solve the deficit through growth, that we will give Canadians hope through growth, that we will resolve the national unity problem by giving Canadians from coast to coast, from British Columbia to Newfoundland, a goal to believe in. That is the Liberal vision.


Mrs. Barbara Sparrow (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, I would like to take a few minutes to respond to some of my colleague's statements.
I was also a little surprised yesterday with regard to the budget. I feel it was more or less an economic statement. One thing that perhaps some of us have forgotten is going back to the economic statement of December 2 presented by the Minister of Finance.
I want to review a couple of areas. My colleague mentioned what he felt was the fundamental restructuring of society. It had to do with lowering real interest rates, retraining using human resources, research and development, and environmental concerns, and the member also mentioned medical and research concerns.
If we take a look over the last period of five to six years, real interest rates are probably the lowest they have been in 20 years. With regard to that area we have
April 27, 1993

to take into consideration the inflation factor. Most of us here would find that over the past number of years inflation has been worked on pretty heavily. It was 1.9 per cent in last month's statistics report.
We have a relatively stable Canadian dollar now. While it has only been for the last six or eight months, we are sitting in the 79 cent, 79.5 cent area, which is extremely important for our exports and our trade.
Training and human resources are very important. I would like to say with regard to the UI changes that were announced in the economic statement, $2.2 billion out of the UI account this year will be spent on job training and job creation for the unemployed. If we put that in the complete package with the government it totals $3.8 billion.
On research and development, we have some of the very best tax credits for research and development in the world.
One thing I want to say with regard-


The Acting Speaker (Mr. DeBlois):: Order, please. I invite the hon. member to ask her question or to conclude her remarks because there are other members who want to ask questions.


Barbara Jane (Bobbie) Sparrow: Thank you, Mr. Speaker. It is hard to get in with these people all clamouring to get out there.
I take those four points the member mentioned very seriously because job creation is important, there is no doubt about it. All of us recognize that unemployment is too high, but the member specifically has to put in more funding.
I would like to know if the member is in a position to comment here in the House with regard to obtaining that funding through curtailment of payments either through transfers to people or to the provincial governments. There is no doubt that 68 per cent to 69 per cent of government expenditures go to transfer payments. Is the member going to increase UI contributions or premiums that are paid by the employers and employees, which would be very difficult? Where is the member going to get the funding for these particular areas to answer his four points?
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Paul Edgar Philippe Martin: Mr. Speaker, first of all I would like to thank the member for her question and intervention and for her recognition that what we got yesterday was not a budget but a very poor statement at best.
I must say that I hope tomorrow within her caucus she will be a voice of reason unfortunately surrounded by a sea of irrationality.


An hon. member:: Misery.


Paul Edgar Philippe Martin: No, the misery is in the country, the irrationality is in the Conservative caucus.
Let me simply deal with the points she raised. The fact is that the projections that are made in terms of real interest rates are historically high. They are almost twice as high as the real interest rates in the United States. The crucial point is not where real interest rates in Canada are in absolute terms but where real interest rates are in relation to our competitors. If they have a lower cost of capital than we do then the effect on our ability to expand is felt directly.
In terms of training, it is not enough to simply spend money. We really have to become very focused on where the problems lie, which is why we as a party have advocated a youth corps to give the 36 per cent of high school students who drop out by grade 10 an incentive to go back to school. It is why we have talked about an apprenticeship program in order to handle the very important transition from high school to the work place.
Germany graduates 600,000 apprentices a year. We graduate 24,000. We are condemning a vast segment of our young population to a lifetime of unemployment.
In terms of research and development, we have really said that the role of government is to focus on changing the economic culture of the land toward one of innovation so that research and development simply does not become an aside.
The science minister sits away back there on the back benches. He is not on the front benches and is not a major minister.


Barbara Jane (Bobbie) Sparrow: He's right there.


Paul Edgar Philippe Martin: He is given the opportunity to speak about once every six months, and only then if all the senior ministers on a Friday are not in the House.

April 27, 1993
The Budget
We are saying that science and technology must become the focus of the industrial development of the country so that we can build a modem economy.
On the issue of funding, first of all we should look at return on investment. Second, if what we want to do is build a modem economy then we should do it on Canadian technology. Do not buy Italian technology to build helicopters to fight a war that is over. Give us a chance to build the things we need for the future.


Dennis Joseph Mills: Mr. Speaker, first I want to congratulate my colleague from LaSalle-Emard for a true message of hope. This is what Canadians want today with so many people not working.
In point four of his plan he referred to the importance of small business in revitalizing the economy and putting people back to work. The question that we get as Liberals is how will we be different in approaching the banks, the financial institutions and the credit unions of Canada and mobilizing them and inspiring them to the realization that small business is where it is at and that is where financial institutions have to focus.
As the chairman of our platform committee I know that the member has done a lot of work in this area. Will the member please give the message of hope to the small business sector and the people of this country on how we will approach the financial institutions of this land on assisting small business.


The Acting Speaker (Mr. DeBlois):: The hon. member for LaSalle-Emard has one and a half minutes left.


Paul Edgar Philippe Martin: Mr. Speaker, I thank my colleague for the question. In the minute and a half that I have been given I want to say that there is no doubt that one of the fundamental problems in Canada is that instead of the financial sector being at the service of the productive sector, enabling us to create the economies of tomorrow, the productive sector has become the plaything of the financial sector.
The Canadian banking system, and most financial intermediaries, are failing in two areas. First, the credit crunch is real. Small and medium sized businesses have been cut off at the pass. They are cut off when they get into financial difficulties or when they are about to take off and they need the money to expand into the markets of the world. The second failure is that we will never build an innovative economy if the banks and financial institutions do not have within their own staffs those engineers and scientists capable of evaluating projects which arise out of the mind, which are not simply bricks and mortar, the conventional kinds of things the Canadian financial system has financed.
We would say to the Canadian financial system: Either you solve that problem or we will open the doors and others will come in to do it. We believe with the power of government and the national consensus of the Canadian people, which says that the financial system has a responsibility to make up for the monopoly powers it has, that those monopoly powers will not stand unless it fills the responsibilities they were designed to fill.


Dennis Joseph Mills: I rise on a point of order, Mr. Speaker. I have talked to our colleagues here and because of the nature of this very important debate we would hope to get concurrence of the House so that we could sit right through the lunch hour to continue to debate this very important piece of legislation.


Mr. Tremblay (Quebec-Est):: Mr. Speaker, we on this side of the House are agreeable to the hon. member's suggestion to continue the debate during lunch hour.


The Acting Speaker (Mr. DeBlois):: Is there unanimous consent to extend debate over the lunch hour?


Some hon. members:: Agreed.


Mr. John Reimer (Kitchener):: Mr. Speaker, when this government was elected to office almost nine years ago the biggest challenge facing us was to restore some fiscal sanity to our economy. Now nine years later, where are we? Some will complain that the deficit is almost as high today as it was in September 1984. Others will criticize us because the national debt has more than doubled since we took office. It would be instructive to review the past
April 27, 1993

nine years and seriously look at these comments in the light of economic realities today.
In 1984 this government inherited a national debt of $206 billion. When the Liberals were elected in 1968 the debt stood at only $18.8 billion but when they left it was $206 billion. During that 17-year period Canada's debt increased and became 11 times higher. By comparison, since 1984 the debt has grown from the inherited $206 billion to $458 billion for this year.
On the surface it would seem reasonable for the opposition Liberal Party to complain that the debt has doubled under Conservative management. However the comparison soon wears thin when one considers that rather than 11 times higher, which happened while the Liberals were in office, it is now over twice as high. On top of that, this government has not added one cent to the debt since 1987.
From 1970 to 1984 a surplus of $220 million became a deficit of $38.5 billion under the Liberal administration. Government spending was out of control. Those are not just my words but those are the words of the Auditor General who in the mid-1970s said he was deeply concerned "that Parliament, indeed the government, had lost or was close to losing effective control of the public purse." He then went on to say: "Federal management and control in the Government of Canada is grossly inadequate." That is what the Auditor General said while the Liberals were in office.
During the Trudeau years, government spending on programs had increased at an average annual rate of 13.8 per cent, far in excess of inflation. If this trend had been allowed to continue after 1984 the result would have been catastrophic. If we had allowed spending to continue at the same average pace as the Liberals, the national debt would have sky-rocketed from $206 billion when we inherited it to over $900 billion today, rather than the $458 billion. This year's annual deficit would be over $85 billion rather than the $32.6 billion for this fiscal year.
We could not leave this burden to our children and to our grandchildren. Action was needed and action was taken. Barely two months into our first term, the Minister of Finance laid out our economic plan, a plan that has been adhered to in every single budget including this one, nine budgets and five economic statements in a row.
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What have we done? Every single budget and every economic statement that this government has offered to Canadians has cut spending. Every single one and every time the opposition complained about our cutting of spending.
Since 1985 a total of $118 billion has been cut by this government. Added to that the December economic statement cut spending by $8 billion. This budget further cuts spending this year by $3.8 billion and next year by $5.8 billion, totalling $30.7 billion over the next five years.
Compared to the average annual increase of 13.8 per cent of the Liberal 15-year period, our program spending since 1985 has averaged only 3.9 per cent per year. Beginning in 1991 the Spending Control Act was passed by Parliament that legislated an annual ceiling of 3 per cent per year. With the measures of this budget, the average program spending will now be held at only 1.5 per cent over each of the next five years. This is well below inflation. The 1.5 per cent average annual increase will be the lowest we have seen in Canada since the early 1950s, or 40 years ago.
The contrast is even more dramatic when compared to the 9.3 per cent under the current Liberal leader when he was Minister of Finance. More astonishing were the increases the present Liberal leader permitted when he was President of the Treasury Board: 16.3 per cent in 1976 and 14.6 per cent in 1977. Clearly this contrast shows this government's fiscal responsibility where our actions speak louder than words. No wonder then that the Auditor General just after two years of Conservative management said: "Members of Parliament and the taxpayers of Canada should be heartened by genuine improvements."
It would be instructive to look at the spending habits of provincial governments over the same period of time. While the federal government was spending at an annual average rate of 3.9 per cent from 1984 to 1992, Ontario during the same years spent at a rate of 10.6 per cent and the province was not alone.
For the city of Kitchener in my riding the average annual increase over those same years was 7.5 per cent. The local public school-board's increase was 9.5 per cent. I must mention that the city and the school-board sometimes had to start new programs demanded by the

April 27, 1993
The Budget
province without sufficient funding. Impressive and deep cuts have been made in this year's budget.
It also seems that Premier Rae and his socialist cohorts at Queen's Park are beginning to see the light. No one should be misled by the socialists here or at Queen's Park in Toronto who say that we have just simply passed on our problem to them. Yes, we have asked them to share part of the national problem. However Ontario's own treasury papers tell us that we did not cut our transfer payments to Ontario. Transfers to Ontario, according to its papers, actually increased from 12.9 per cent to 17.2 per cent of total provincial revenues. Remember that these are not my figures; they come straight from the Government of Ontario.
Added to that the impact of our measures on Ontario represented under 1 per cent in the first year and under 2 per cent in subsequent years of the total provincial revenues. All the while Ontario continued spending at an average annual rate of 10.6 per cent while we here in Ottawa over those same years were spending at an average rate of 3.9 per cent.
As I said earlier the national debt has more than doubled since 1984. Also we have not added one penny to the debt since 1987. What does that mean? Quite simply since 1987 we have been running an operating surplus.
In 1985 we ran a $16.1 billion operating deficit in our first year. In effect on top of the annual interest payments on the debt, another $16.1 billion was added to the debt. By 1987 we turned this around. Since then the cumulative effect of the surpluses in each year has actually reduced the national debt by $25 billion.
Since 1984 the government has privatized or dissolved 39 Crown enterprises and other holdings and has improved the operations for the remainder. The number of full-time Crown corporation employees has been reduced by nearly 90,000 individuals.
In 1984 the inflation rate stood at 4.4 per cent. Today it is under 2.5 per cent. Interest rates have fallen from 13 per cent in 1984 to 6 per cent today. Therefore mortgage rates have also tumbled. The annual cost of carrying a five-year $75,000 mortgage has been cut by $3,300 per year since we were first elected.
Even the unemployment rate is lower today at 11 per cent compared to 11.2 per cent in 1984. That is after coming out of the worst economic downturn since the Great Depression of the 1930s.
Job creation features in the 1992 budget and the December statement are now beginning to work and we can see the evidence of that. There are 200,000 new full-time jobs since August of last year and 48,000 new jobs in March of this year. Between 1984 and 1990 more jobs were created in Canada than in all of the following countries combined: France, Sweden, Norway, Denmark, Greece, Ireland, New Zealand, Belgium, Switzerland, and Finland. They represent more than four times the population of Canada.
Since 1984 Canada has led all G-7 countries in percentage increase in job creation. According to the OECD, Canada will have the strongest percentage increase in jobs of any major industrialized nation this year and next.
This budget announces a further 10 per cent cut added to the 10 per cent cut in the December 1992 statement. This is to be followed by subsequent cuts of 15 per cent and a cut of 20 per cent for all advocacy groups.
I personally think they should all be at zero. In other words they should all be cut 100 per cent and not this piece-meal of 10, 10, 15 and 20 on top of the cuts we made previously. These advocacy groups should raise all of their money through their own membership and the Government of Canada should give them not one penny.
As it is now we discriminate in favour of liberal leftist feminist groups such as the National Action Committee on the Status of Women and we discriminate against other women's groups such as the conservative-minded group REAL Women. The truth is that all of these advocacy groups, whether right or left, should be cut 100 per cent.
Funding for multicultural groups should also be cut 100 per cent. They should do what other successful ethnic groups, such as the five German clubs in the Kitchener-Waterloo region have successfully done over the years, that is, raise their own money. Those five clubs have never asked for nor received a penny of federal government money and all of them are very successful and are growing.
April 27, 1993

We could then take the money saved and use some of it to enhance Canadian citizenship and pride in being a Canadian. That is exactly why all the immigrants come to Canada in the first place: to be Canadian citizens and to be a part of and live in and contribute to what is the best country in the world in which to live according to the United Nations.
Also, we could take some of this money saved and use it for a package to stimulate the building of new homes. I recommended such cuts and such a stimulative measure to the minister. I recommended a modest mortgage interest deductibility program limited to all first-time buyers of new homes for a 10-year period.
It would help young families to buy new homes. It would stimulate the construction industry. It would put unemployed manufacturing workers back to work rather than drawing on UI benefits and welfare. It would put them to work in housing construction and trades that could be quickly learned. Yes, it would cost money at first. Then in less than two years it would begin to pay it all back and all Canadians would reap the benefits.
Nevertheless I am very pleased to read the following from the budget:
In response to representations on the equity capital needs of smaller, knowledge-based firms, we will also explore ways to develop mechanisms to encourage investors to support local companies and at the same time lend their expertise to help the companies succeed.
This part of the budget is in direct response to an idea developed in the Kitchener-Waterloo, Cambridge and Guelph area under the leadership of Mr. Larry Zepf which I and other area MPs had brought to the Minister of Finance. This must be added to other representations by the MPs from Kitchener-Waterloo, Cambridge and Guelph such as the welcome news of the faster writeoffs of new high-tech equipment in this budget and the additional $230 million for Canadian companies undertaking research and development in the December statement. All will help job creation in our region and across Canada.
In conclusion, the best part of this budget and of the actions taken since 1984 is that because of a disciplined cutting of spending in every budget and after the worst recession since the Depression of the 1930s there is now
The Budget
finally some light at the end of the tunnel. We can now project, if we stay the course and only if we stay the course, the elimination of the annual deficit and we can begin to pay off on our national debt in four years' time.
We can do this without any new taxes. In fact, new taxes will deny consumers the ability to spend and to speed the recovery. If we did cut taxes the socialists in Toronto would just take away for themselves any tax cut we might make, as they did in 1992.
There are only two ways to reduce the deficit: higher revenues and lower spending. The right way to reduce the deficit is to cut spending. The right way to get higher revenues is to encourage economic growth. We cannot do that by raising taxes.
According to international think-tanks, investment agencies and the United Nations, if Canada continues the disciplined course it has been on since 1984 it is poised to lead the world in economic growth over the next few years. We have the opportunity, again if we stay the course and only if we stay the course to eliminate our deficit and to begin to pay down on our debt.


Guy H. Arseneault: listened with interest to the hon. member's speech. Through you, Mr. Speaker, I must say to the hon. member that I am very concerned with this so-called budget.
After reading through it and listening to comments made by hon. members this morning, the media and experts in the media, I agree with them that there is no growth or employment strategy in the budget.
The government seems to be withdrawing from regional development. It is withdrawing from mining, tourism, forestry and plans on withdrawing from a number of other sectors in the near future.


Dennis Joseph Mills: It is ignoring small business.


Guy H. Arseneault: It ignores small business completely. It uses the term "small business" in its documentation but there is no concrete solution to the problems that small businesses must now face and that is to have access to capital and new investments. There is nothing in this budget for that.


Mr. Tobin:: Right on.

April 27, 1993
The Budget


Dennis Joseph Mills: Right on.


Guy H. Arseneault: The Conservative plan for economic renewal is a complete failure. This budget is yet another example of the fiscal mismanagement that has been exhibited by the government since it came to Parliament in 1984. The government has been a complete failure. Again this budget is evidence of that failure.
More specifically we heard the member brag about some of the cuts that are in this budget to multicultural-ism and advocacy groups. With that philosophy in mind I am wondering why the hon. member did not recommend to others in his caucus to cut the $5.8 billion helicopter program with the savings going to address the human deficit that we have in this country.
What about the Prime Minister's luxury multimillion dollar trip? Why has the member not stood in his place and said that that trip should be cut? Here is the member's chance to answer. Let us cut.


John Henry Reimer: Mr. Speaker, through you to the member. The member has identified many different areas. Let me respond briefly to each of them in part.


Brian Vincent Tobin: Start with the Prime Minister's trip.


John Henry Reimer: He talked about cuts in mining and tourism. The member will remember that he and I were on the same side of the issue in the referendum debate. We said that it was time for the federal government to start recognizing that some of these areas are better addressed by the provinces than by the federal government.
In part that is what we are beginning to do. We are beginning to say that that is where the major responsibility lies. Therefore the care and funding for that should begin to take place there. In part that is what is happening.
The member says that this budget ignores completely small business. What is amazing to me is how quickly the opposition forgets. The opposition forgot that in December we introduced an economic statement in the House that addressed specifically small business.


Dennis Joseph Mills: It is not working.


John Henry Reimer: The members opposite cry out and say that it is not working. Then let us look at job creation
figures which I cited: 48,000 in this past month. If that were put on an annual basis the percentage of increase of job creation in Canada is remarkable and that comes right after a very devastating recession in Canada.
Those job creation figures that are occurring now, partly because of our measures in the 1992 budget and the small business actions taken in the December economic statement, are all beginning to bear fruit.


Dennis Joseph Mills: Say that the banks are loaning to small business. Say it in this House.


John Henry Reimer: Let me go on. The member talks about the helicopters. Those members like to put helicopters in opposition to every single item of the budget. They are always focusing on this one item but what they forget is that the helicopter purchase is within the budget of the DND. It has been there and is planned to go over a 13-year period. It is not all spent in one year. They forget to say all of the job benefits that come to Canada. They forget to say what benefits come to Canada because of the building of these 50 helicopters. They forget to say the long-term benefits that Canada will realize in developing people who have skills in research and development and in the high-tech development of equipment. They forget to say that if we in fact do that, then we will not repeat the problem that all of us as Canadians went through when we had to cancel the Avro project because no one was buying new aeroplanes. In a sense they want that repeated.
This is the last point that the member raised. The other member who wanted to ask a question wanted to be sure that I addressed this. The member referred to the luxuiy trips-those are his words-of the Prime Minister in his planned trip to Europe and to the Soviet Union.
There is one thing that I find really disturbing about comments such as this one. This is not just debate difference. This is in essence saying that we Canadians do not have any pride in our institutions. In essence it is saying that we Canadians have no pride in our Prime Minister and that we have no pride in Canada and that we do not want our Prime Minister to go to other countries to be the advocate for Canada.


Some hon. members:: Oh, oh.
April 27, 1993


John Henry Reimer: Do you notice, Mr. Speaker, how they laugh? All the words of derision are all from the seats of their pants. When the American President flies in Air Force One, as the first aircraft is called for the United States, I am always impressed by one thing. At least Americans say: "The President, whether I voted for him or not, has the right to do that." When a Canadian does it, oh, no he is not allowed to do that. I think it is time that we had a little more pride in our institutions and in our country and then we would not use words like that.


Mr. Eugene Bellemare (Carleton -Gloucester):: Mr. Speaker, I listened carefully to the hon. member's speech. At one point I consulted the public accounts, and I would like to correct the hon. member's erroneous and deplorable presentation of the facts.

In the public accounts report of 1984 it says that the total national accumulated debt is $157 billion and not the figure that he stated. He should check the Auditor General's report like I did. I would invite him to come with me to the Standing Committee on Public Accounts.
In 1992 the last public accounts report stated that the national debt is $423.1 billion. This is in 1992. If he had bothered to read the 1993 budget of the Minister of Finance he would have discovered that on page 19 the net national public debt is $491.2 billion. In other words, contrary to what he said at the beginning of his speech, his government managed to more than triple the national debt.


Guy H. Arseneault: More than any other government since Confederation.


John Henry Reimer: Mr. Speaker, it is interesting how we on this side and the members on the opposite side like to use figures for our advantage.


Some hon. members:: Oh, oh.


John Henry Reimer: Both we and they do it. They laugh when I do it but I am supposed to cry when they do it. Is that not correct?
It is interesting that when they ask a question they do not want an answer. They do not give any simple common courtesy as I did to the member. I was quiet and I listened. Now when I want to respond, they all yell. That tells me that if they really were interested they
The Budget
would keep quiet. However, no, they are not interested in the truth. They could not care less what the truth is and they just simply want to twist things to their advantage.
In trying to respond-


Eugène Bellemare: The member cannot respond unless he gets the books as I have offered to do.


The Acting Speaker (Mr. DeBlois):: Order, please. I ask for the co-operation of all members. The public and I are having some difficulty hearing the hon. member. Some people watch our debate and I think they want to hear the hon. member.


Dennis Joseph Mills: Mr. Speaker, I have a point of order. I listened attentively to the member's remarks and I took notes. He did say in his opening remarks that the national debt was $206 billion.


The Acting Speaker (Mr. DeBlois):: I regret that this is not a point of order.

This is not a point of order, but a matter for debate. The point was already raised by the hon. member for Gloucester. The hon. member is trying to give his version of the facts which he will when he has an opportunity to do so. I would ask hon. members to respect the views of their opponents. According to our parliamentary system, members on all sides should be able to hear a member's arguments without constant interruptions. I am sorry to have to state the obvious, but it is the basis of our parliamentary system. The hon. member for Kitchener.


John Henry Reimer: Mr. Speaker, I will quickly respond to the best of my knowledge. I will stand by my figure until I am shown that it is incorrect.
To the best of my knowledge and according to the research I have done and by all the figures I have looked at and have been told, the deficit we inherited in 1984 was $206 billion.
I stand by that figure and that is what I used in my speech. That is where I went from. What is it now? If I look at 1992-93 and the budget document that we have from yesterday, it is the figure that I used of $458 billion.

April 27, 1993
The Budget
I stand by the figures I used. Therefore when I said that it has more than doubled during the Conservative time from 1984 to the present from $206 billion to $458 billion, that is correct. It has a little more than doubled.
When I said that it went 11 times higher during the Liberal period, I stand by that because those are the figures I have.


Eugène Bellemare: Mr. Speaker, I rise on a point of order. I realize the hon. member who just spoke and I do not have the same views, but the hon. member does not seem to agree with my figures taken from the public accounts reports from 1984 and 1992.1 could even quote chapter and verse, but the hon. member referred to would not agree.


The Acting Speaker (Mr. DeBlois):: I am sorry to interrupt the hon. member. In this House, all members may express their views, and it is up to the public to judge. It is not up to the Chair to determine who is right and who is wrong or to weigh arguments that are brought before the House. You have taken one position, the hon. member has taken another position. I think the public is able to make up its own mind. It is not up to the Chair to judge whether your source or the source quoted by the hon. member is right or wrong. The Chair notes what is said. It is all part of the debate. The Chair does not intend to judge the quality of the sources quoted in this House.


Eugène Bellemare: Mr. Speaker, when we refer to reports that were tabled in Parliament-as you know, I am a member of the public accounts committee-it is not right for a member to make statements that convey the exact opposite of the figures tabled by the Auditor General of Canada and the Comptroller General of Canada. The figures I received from these two sources, from the Auditor General of Canada and the Comptroller General of Canada-


The Acting Speaker (Mr. DeBlois):: Order. Again, I am afraid I will have to cut short this point of order. When members on both sides of the House quote from public documents that were tabled here in the House, it is not up to the Chair to judge those documents. They exist, and they were tabled. You are referring to the public accounts, and the hon. member is referring to the budget
speech. The Speaker is the servant of the House and, as such, listens carefully to the views of hon. members, but it is not up to him to say who is right. When a vote is held, hon. members can render their own verdict, speaking on behalf of their constituents and the people who support them.


Eugène Bellemare: I rise on a question of privilege, Mr. Speaker.
Is the hon. member insinuating that the Comptroller General of Canada, that the Auditor General of Canada to whom I just spoke on the telephone, and I, a member of the public accounts committee, lied to the House, or would the hon. member agree he made a mistake by not checking his sources?


The Acting Speaker (Mr. DeBlois):: I am afraid I will have to be firm. This is not a point of order nor a question of privilege. We are talking about views that were expressed. As far as I know, the hon. member did not say his opponent was a liar, and there is no reason why the Chair should demand a withdrawal of any kind. Both members have expressed different views, and that is allowed according to the rules of parliamentary and democratic debate.


Guy H. Arseneault: I rise on a point of order, Mr. Speaker. I do not want to prolong this, but in light of the comments that have been made and exchanged between the two members and since the comptroller and the Auditor General seem to be criticizing the Minister of Finance and vice versa, I wonder if it would not be wise for the Minister of Finance to withdraw his budget in the meantime to check the figures.


The Acting Speaker (Mr. DeBlois):: This is not a point of order.

I am sorry, but I cannot go on repeating the same arguments, and I hope this will be the end of it. If members have different views, they can express those views in the course of this debate. There is plenty of room and time for members to express their points of view.
April 27, 1993


Brian Vincent Tobin: Mr. Speaker, I am happy to participate in this debate. Let me say that I was quite surprised by some of the comments made by the member for Kitchener. Even though he sits on that side, he is known to many of us in this Eiouse as generally having some degree of common sense.
I am certain that the people of Kitchener would be quite surprised to hear the member, albeit in a difficult situation, less than 24 hours after a so-called budget that preached the virtues of restraint and everybody doing their fair share, defending as appropriate, wrapping in the flag of patriotism, issuing a call to arms, the Prime Minister's first class, paid, goodbye holiday trip around the world, through Europe and the United States at a cost of millions of dollars. He says it is an appropriate gesture and all Canadians ought to stand, face the flag, salute and feel their heart bursting with pride as the Prime Minister really shows how Canada can spend lavishly at a time of restraint.
I say to the member with great respect that I suspect the people of Kitchener will not appreciate the member for Kitchener taking that view in this regard.


An hon. member:: Hard working people.


Brian Vincent Tobin: Let me say to the member as well that I hope the people of Kitchener are watching today. If some are watching, I hope they will call up the Kitchener-Waterloo Record, the newspaper in Kitchener and ask it to request a copy of the member's comments.
I do not think they will be impressed with the member's comments at a time of restraint when governments all across the country are putting cuts in place. We are within days of an historical vote in the Soviet Union where the people showed they were committed to democracy. They said yes to Yeltsin, yes to reform, yes to staying the course and not going back to the old ways of the old communist government and the cold war. A massive number, 70 per cent, surprised the planet and said yes to staying the course, yet this government would bring in a budget and keep in place a $6 billion expenditure for cold war helicopters.
Only a few weeks ago the minister of defence was saying: "But we have to keep this expense in place
The Budget
because we do not know what is going to happen in the Soviet Union. Yeltsin may be pushed out. The people may go back to a communist regime."
I do not think anybody on the planet was prepared. A scant few days ago the results came in with a margin of greater than 70 per cent. The hard-pressed people of the Soviet Union, living in difficult circumstances, making great sacrifices and doing without nevertheless embraced democracy by an overwhelming margin in North American terms, an unheard of margin. They wrapped their arms around the concept of democracy and reform and said they would stay the course.
What is Canada's answer to that historic vote? Our answer is to bring in a budget in which we keep in place a $6 billion cold war expenditure. What is the member's comment opposite? It is an appropriate expenditure. We need to spend those billions to watch our enemy, the Soviet Union. Even the United States, the arch enemy of the old and gone Soviet empire has chosen to upgrade over 500 helicopters in its helicopter fleet. Two hundred and thirty nine search and rescue style helicopters have been upgraded at a cost of $10 million each. Over 300 Chinooks have been upgraded by the United States but Canada alone in the world is going to spend nearly $6 billion on helicopters we do not need.
The company in question, Westland Augusta is bankrupt. It has been taken over by an Italian crown corporation. The president of the company has been arrested and charged in a bribery scandal and is now before the courts in Europe. The helicopter in question crashed, killing all the crew and the remaining prototypes have been grounded pending an investigation. Yet this government insists on proceeding-


An hon. member:: That is right.


The Acting Speaker (Mr. DeBlois):: On a point of order, the hon. member for South Shore.


Mr. McCreath:: Mr. Speaker, I am sure it was inadvertent on the part of my hon. friend because I know he would not want to mislead the House when he said the type of helicopter we are buying crashed. He refers to a $6 billion contract when he knows perfectly well that it is a $4.4 billion contract. These points have been frequently-

April 27, 1993
The Budget


The Acting Speaker (Mr. DeBIois):: I am sorry but it is not a question of order.


Dennis Joseph Mills: Gucci helicopters.


Brian Vincent Tobin: Not only was it not a point of order, it did not even make any sense. It is a $5.8 billion expenditure.


Barbara Jane (Bobbie) Sparrow: It's $4.4 billion and you know it. Your
nose is growing.


Brian Vincent Tobin: The hon. member opposite says: "No, no, you cannot say $6 billion, it is only $5.8 billion." Let me tell you about government projections. According to its own budget papers in 1991-92 this government projected a deficit this year of $27.5 billion, which is why it cannot be taken seriously.
Do you know how much it was off by? Can you guess how much it was off by? Was it off by a mere billion? Was it $2 billion?


Some hon. members:: More, more, more.


Brian Vincent Tobin: Was it $3 billion? Was it $4 billion; $5 billion; $6 billion? Was it $7 billion? Was it $8 billion? It was off by a full $9 billion.


Some hon. members:: How much?


Brian Vincent Tobin: It was off by $9 billion. This government projected in its last full budget that it would create in the intervening period to this day an additional 500,000 new jobs. How much do you think it was off by? Was it off by 100,000, 300,000, 500,000 or 700,000? It was off by 800,000 because it did not create 500,000 jobs. In the intervening period, the economy has actually lost an additional
300,000	jobs.
How can anybody take the projections of this Minister of Finance and this government seriously?
This budget has been printed on recycled paper and so it should be. It is a recycled document. Only an excellent, first class, used car salesman could call this document a new model this year. This is old, used, abandoned, the tires are flat and the gas tank is empty.
Canadians expected a game plan. They expected the government to invite them to engage in a crusade to rebuild, reinvigorate this country and make it competitive to ensure we can challenge the world and earn our
fair share of this planet's wealth. They were prepared to do their part.
I have just spent weeks in the province of Newfoundland knocking on the doors of some of the poorest people in this country. Do you know what they said? They said governments cannot spend beyond their means. They are not putting their hands out and saying "spend, spend, spend"; they are saying "be responsible." They are saying "be competent"; they are saying "give us a game plan and we will do our part. Invite us to participate in rebuilding this country and restoring confidence. We will do our part."
Then the government yesterday produced this thin, mean, tired, worn out, transparently empty, political patronizing piece of paper called a budget that invites people to just close their eyes to the disaster this government has visited upon this country.
The ship of state of Canada is in the middle of the ocean. The winds are high, the waves are high and she is being battered to and fro. What this ship needs is a steady hand on the wheel. What do we have instead? We have a tired Tory government telling the passengers, the population of Canada, to go back to sleep, that the ship is on course. The course is disaster. This is not just my opinion or the opinion of the members opposite. It is not a journalist's opinion nor the public's opinion. The budget documents tell the story.
What do they say? The Auditor General, as my colleague has made clear, pointed out that in 1984 the public debt of Canada was $157 billion. From the time the country was founded until 1984, 117 years, the total debt acquired in building the infrastructure of the country-the highways, schools, universities, towns, transportation systems-was $157 billion. With that we built and created one of the greatest nations on earth.
What has happened in the intervening nine years? Are there any more highways? Are there any more transportation systems? Have any more great cities been created out of dry land on the Atlantic, on the prairies, in the heartland? No. What has happened to the deficit in the intervening years?
Let us look right in the budget document. All members pick up their documents and turn to page 63. It is right in the document. From the $157 billion it cost to build an entire nation over 117 years, in nine years this
April 27, 1993

government drove the deficit to $458.6 billion at the end of this fiscal year.


An hon. member:: With over three million people out of work.


Brian Vincent Tobin: And what does it give us for that? What new infrastructure, what new population, what new cities, what new highways, what new hospitals, what new industries?
Mr. Speaker, you have not heard the best part yet. I know your curiosity is now piqued. It is telling us that if we re-elect it four years from now-page 62 of the document-it will add another $100 billion to the national debt. During the life of another government if it is re-elected, the national debt will go up to $563.2 billion, another $105 billion. That is its plan. That is what it is putting on paper. That is what it is admitting to. If everything goes fantastically well it will increase the debt by only another $105 billion.
That is the game plan opposite. This is the party that campaigned on the notion of fiscal responsibility.
Let us look at another page in the budget because I do not want to give you my opinion. You might think it is kind of shaded, given that I would like nothing more than to see this crowd booted out. Let us look at the budget document itself. Let us turn now to page 26. Members of the public who do not have their copy yet should write down the number so they can look at it later when they do have a copy of the budget. On page 26 there is an incredible admission:
Canada's gross international liabilities are partly offset by foreign assets held by Canadians. Nevertheless, relative to the size of the economy, Canada is now by far the most indebted of the major industrial countries. Further, Canada's net foreign liabilities reached a post-war record in 1992 - 43.8 per cent of GDP.
The budget document says that this government has put Canada in the position where we are now the largest debtor nation in the entire industrialized world and that under this government we set a record in 1992. What was the record? We have a post-war record whereby 43.8 per cent of our GDP is our foreign liability. This is our
The Budget
foreign-held debt or Canadian paper held in foreign hands. Of that total, 40 per cent is held by Japan.
I said it was a record. When was the previous record? Let me read on in the document:
Its previous peak was 42 per cent in 1961.
What party was in power in 1961? It was the last time the Tories were in power under Mr. Diefenbaker.
All the rhetoric in the world by the member for Kitchener and by every happy and well-trained member opposite in the Conservative Party will not change the facts contained in their government's own budget document. The legacy of this government is to bring Canada to the point where Canada under this administration in nine years has almost tripled the previous debt piled up in the first 117 years of Confederation and where Canada in the western industrialized world is the largest-bar none and second to none-debtor nation on the planet. One can think of all the countries one wants to.
The Conservatives standing up and saying with that record to the people of Canada: "Re-elect us and we will pile on another $100 billion of debt," is like the pyroma-niac arrested with the match in his hand who says: "Sorry fellows, I was just kidding. I would like now to apply to be fire chief." If it were not so tragic and so serious it would be laughable.
I do not even know why we had a budget yesterday. It was a phoney budget and a phoney exercise. There were no changes in the fiscal arrangements between the federal and provincial governments, no changes in the corporate tax rate, no changes in the personal income tax rate, no initiatives to create jobs or no long-term plans to come to grips with the annual deficit or the long-term debt.
There was only one thing it did that was of any substance and only one way in which it tipped its hand. It did two things. The member for St. John's East cannot be pleased with this. I notice that he is looking distinctly uncomfortable about it. I refer to page 53 in the book. The government indicated that it is not going to renew federal-provincial agreements in the areas of forestry and mining. There will be no more federal-provincial co-operation in forestry or mining. That is important to my area of Corner Brook, Newfoundland, to central Newfoundland, to western Newfoundland and to the forestry sector all across Canada. This sector provides one in every 10 Canadian jobs.

April 27, 1993
The Budget
It wiped out and happily said goodbye to the mining sector. This is also important to my part of the country and to my riding in particular and to the Baie Verte peninsula.
What else was said? It was said that the government will be reviewing the economic and regional development agreements in other sectors as they expire. This includes economic and regional development agreements in agriculture, communications, the environment, fisheries, transportation, industrial development, industrial innovation and tourism. In every area and far-flung region of this country those who have the least among us seek to rebuild their infrastructure, add value to their industrial base and take their natural resource area and build on it to create new wealth. In every area where those who have the least reach out their hands in a sense of co-operation, partnership and building, this federal government is going to withdraw the federal hand and walk away and abandon the regions of Canada. That is the game plan and that statement in the budget makes a mockery of a statement yesterday or two days ago by the Minister of National Defence in Atlantic Canada when she said that she wanted to put more money into regional development. It is an absolute farce.
There is one other important matter. The defence minister said: "If I am elected as leader of the Conservative Party I will wipe out the deficit in five years." The Minister of the Environment said: "If I am elected as leader of the Conservative Party I will wipe out the deficit in four years." That is the claim.
Again, let us look at the budget papers. We want to have an objective opinion. According to the budget papers, the Minister of Finance is forecasting that-even if we believe all of his blown up, hyperventilated, exaggerated claims to growth and productivity which I do not not of course having had experience with believing those things in the past-there will be at least a $14 billion annual deficit on the date by which the Minister of the Environment says we will have no deficit. There will be at least an $8 billion annual deficit on the date by which the Minister of National Defence claims she will wipe out the deficit.
If the leadership candidates for the Conservative Party cannot get their story straight with their own Minister of Finance who is telling us that we cannot wipe out the debt in five years or in four years despite his best efforts, then it is time for Tory leadership candidates to explain precisely to Canadians how they are going to eliminate the debt. Let the Minister of National Defence tell us whether it is old age security, medicare or education funding. What basic programs important to Canadians are going to be wiped out to pay for helicopters and to keep a campaign commitment that was given by someone who had not thought it through?
The ordinary people of Canada, the people who sit in their T-shirts with beers in their hands and with whom the Minister of National Defence cannot relate, know bull when they see it. This budget and these campaign promises both belong in the same category. I cannot say the word in the House, Mr. Speaker. Let me just say this. The people of Canada know a phoney exercise when they see it. It takes a face like a horse's you know what to get up and try to present this budget to the people of Canada as a serious exercise in regulating and managing our economy. This is a shameful and ridiculous exercise that we have engaged in with members opposite.


John Henry Reimer: Mr. Speaker, I have a question for the member for Humber-St. Barbe-Baie Verte.
Before I get into the question and the reference to the pages that he was referring to I would like to talk about that little debate we had on budget figures and why I used $206 billion.
Look at the public accounts for 1991-92 on page 1.2 and table 1.1 that is headed deficit and net debt: "In the year ended March 31, 1984 the net debt was $167.8 billion." I will read further on the same page: "From April 1, 1984 to March 31, 1985 the net debt was $206.3 billion." This is the figure I used.
The reason I used the figure $206.3 billion from the public accounts was that the election was on September 4, 1984. Therefore, I should use the numbers that go after that or are in that current fiscal year. That is the reason I used it.
When I said I stand by the number of $206 billion then I have to use the number of $206 billion because that is the figure in the fiscal year in which we came in. I cannot
April 27, 1993

The Budget
go to the previous year. I have to use the $206 billion. I have no other choice.
I think in the debate we should be careful why we use certain numbers. The member was right to quote $157 billion-I think it was $167 billion-for the previous year. I have no quarrel with that. However, I have to use the number from the fiscal year in which we were elected and that was $206 billion.
I have a few questions. The first question is with regard to page 62.
I have to thank the member, through you Mr. Speaker, for his kind remarks to me. He was very gracious. In trying to be gracious to the member I must say that I enjoy the play acting he does every day in Question Period in the House. I enjoy his choice of words. I think we all do. I think some of us who do not come from Newfoundland envy those from Newfoundland. They have a remarkable ability and use of the English language. We enjoy listening to them and we have just had a good display of that here today. I do not know how much we learned. There was a tremendous amount of heat but I am not sure there was a lot of light.
My question is this. On page 62 he took us through the line of net public debt, which is $458 billion for this year through to $563 billion for 1997-98. That is correct. He was right.
Guess what? I want to ask this question through you, Mr. Speaker. Why did the member ignore the next line? He said nothing about it. That line shows that the financial requirements excluding foreign exchange will go from minus $34.4 billion this year to $1 billion in 1997-98. Why did the member leave that line out?
My second question is this. He quoted page 26 and said: "Look at the damaging things that are said. Canada is now by far the most indebted of the major industrial countries." That is true and exactly right.
Why is it that for nine budgets and five economic statements where we tried to cut spending the member voted against it every single time? Why did he do that? Why did he not join us in cutting the spending? Why did he not support us in cutting the spending?
My last question-


The Acting Speaker (Mr. DeBlois):: Time is running out. In all fairness I have to give the floor to the hon. member.


Brian Vincent Tobin: Mr. Speaker, it is obvious to some people that the way to avoid hearing the truth expressed a second time is to make the noise of a stick in an empty barrel and keep pounding away until the clock runs out.
I frankly do not know what the member's great debating point was. If the member stands on his feet and says: "We agree that the deficit or the debt of Canada is going to increase by $105 billion in the next four year if our government is re-elected; there is no argument," then I do not know where he thinks the great debating point in that is.
If he agrees with the budget documents that the annual deficit cannot be wiped out, as is claimed by the two leadership candidates, then I do not know what his argument is.
The member talked about Newfoundlanders having a great-I do not know if it is true or untrue-ability to express themselves but I will say one thing. Where I come from we do not need to try to find semantic arguments in numbers to say things. The people of Canada know when their nation is in trouble.
The people of Canada not just in Newfoundland but all across this country want to do something about it. They want to participate in a plan. We are profoundly disappointed that there is no plan.
What was the great debating point in having the member note that Canada is the largest debtor nation in the world? Why did we not vote with the government? It is because we believed, as we do today, that the government's approach was wrong. The government's approach was to surrender in the face of unemployment.
We do not believe in the so-called war against inflation and that 1.6 million unemployed across this country or nearly three million underemployed are acceptable losses-to use a Vietnam kind of wording-in the war against inflation. We have been saying that for a number of years. We have not been listened to.
This economic experiment where all bend down before the altar of so-called unshackled capitalism as proposed by this government has failed. It has failed.

April 27, 1993
The Budget
In Great Britain where Margaret Thatcher held sway the country is in a mess. In a recent Gallup poll more than 50 per cent of the people of Great Britain said that if they had the opportunity they would leave Great Britain.
In the United States where Ronald Reagan held sway with his so-called revolution the debt of that country has been driven through the roof. Those who were fundamentally dishonest have profited. The savings and loans scandal was unvarnished greed where people took the pension funds, the retirement funds and the savings of the innocent.
They created phoney corporations and this was all done legally under the Republican's new U.S. law. They ripped off hundreds of millions and billions. They ran with the cash and left innocent people bankrupt. The American government bailed them out. That same right wing philosophy prevailed here and got us in trouble.
We bailed out the banks. We are spending almost $6 billion on helicopters because some lobbyist is making a mint off the commission but we will not put one nickel on the table to put an unemployed Canadian back to work.
The government will not even ask our people who are begging for a chance to participate with us in a crusade for our country. Canadians know this is a great country. They just want a government and a plan that knows it as well. They want a chance to rebuild this great land.


Mrs. Edna Anderson (Simcoe Centre):: Mr. Speaker, we hear so much being spoken about the helicopters and the cost of these helicopters. Opposition members do not take into account that the amount of money which is $4.6 billion in 1992 dollars will be spent over 13 years. That is quite different from what is being quoted all the time.
There are 800 helicopters presently on order in the world and Canada will have 10 per cent of every helicopter built. It will also create 45,000 person-year jobs for Canadians. I think this is something we have to put down. There is job creation and that is very important.


Brian Vincent Tobin: Mr. Speaker, I know the hon. member made her comments sincerely but I want to tell her there are not 800 helicopters on order world-wide.


Barbara Jane (Bobbie) Sparrow: Yes, there are.


Brian Vincent Tobin: No, there are not.


Barbara Jane (Bobbie) Sparrow: That is not true.


Brian Vincent Tobin: I am giving you the facts. There are 70 on order world-wide and 50 were ordered by Canada alone. We are ordering more of those helicopters than all the rest of the planet combined, including the two countries that are building them. The member opposite, whom I have known for a long time, should check her facts before she says it is not true.
Members opposite are sensitive about these helicopters because they are going to bring this party and this government crashing back down to earth.
Canadians know a multimillion dollar job to fill the pockets of lobbyists when they see it. The only people who are going to profit from this are Tory lobbyists.


Mrs. Dorothy Dobbie (Parliamentary Secretary to Minister of Consumer and Corporate Affairs and Minister of State (Agriculture)):: Mr. Speaker, I hope the rest of the debate can be conducted without these histrionics because I do not think they are helpful to Canadians who are concerned, as I know a number of my friends opposite are, where we are going vis-a-vis the deficit and the debt. People are interested in the future of our country want to see a responsible method taken to reduce the deficit and the debt. They want to see something concrete and some real plans.
I regret that while a lot is being said on the other side about what is wrong with this budget, I see very little productive or positive comments coming from them and no suggestion or plan that would give Canadians confidence. The fact of the matter is they do not have a plan and they do not have any new ideas.


Mr. Milliken:: Well neither do you in this budget. This is all old stuff. Nobody else thinks this is good either.


Dorothy I. Dobbie: I would say that the budget of April 26, 1993 is now before us and this is what we are dealing with, not old stuff. We are dealing with the future and what is going on in the country today.
April 27, 1993

It is no surprise-you have been listening to it all day-when I say the budget has not met with universal approval. Canada would not be Canada if it had and the opposition would not be the opposition if it approved of anything the government did because members of the opposition are very hungry for power these days.
Although they do not have any real plan or any real idea of what they might do with that power, we can smell the greed and hunger over there. It is affecting and impacting their judgment and it often impacts on what they are saying.
While it is easy for the opposition to criticize, I think it would be much more difficult to be in the finance minister's resoled shoes. The hon. finance minister did not go out and buy a new pair of shoes in honour of what is happening these days in the economy. He had his current shoes resoled. I would say it is much more difficult to be in his shoes than it is to sit on the other side of the House and criticize indiscriminately simply for the sake of opposing.
I really want to extend my very sympathetic understanding to my colleague, the hon. Minister of Finance. He had some very tough choices to make and he was faced with bringing down a budget very close to an election and of course close to a change in leadership. He is doing this at a time when our options are so few. I congratulate him, as my colleague the Minister of the Environment pointed out, for setting the table for the next leadership convention and the election that is coming. He is setting the table for a renewed mandate for the Conservative government. I think he has done an admirable job under these circumstances and once again I extend my congratulations to him.
The opposition has made a great to-do this morning about the fact it did not see anything in the budget to stimulate the economy. I want to set the record straight by pointing out that this budget is an adjunct to the financial statement that was made in December which contained many provisions to stimulate the economy. I see my friend opposite does not want to hear this so he is leaving. He is blocking out what I say and ignoring it because the truth is very difficult for him to take. I can understand that. Nevertheless I am going to say this
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anyway for his edification. Perhaps he will be good enough to read the record later.
We have taken measures to support the recovery and let me just list some of them. There has been a reduction in the personal income surtax which is already in effect. It has put more money in the pockets of Canadians in those provinces that did not take that money back and use it for their own purposes. Certainly in my province, Manitoba, the tax reduction was allowed to stand and Manitobans now have more money as a result of the initiative taken by the federal government.
We have also introduced a two-year special home-buyer's plan which is in effect. There have been other things like a reduction in manufacturing and processing tax rates and an increase in the CCA for manufacturing and processing machinery and equipment. We have redirected capital gains exemptions. We have streamlined research and development tax credits and made changes to the withholding tax.
We have done a number of other things and I will not go into all of the detail, but just in case my friends opposite want to bring this up I can tell them that much has been done to stimulate the recovery in Canada and it is paying off. We are seeing the impact now. The economy is growing and has been doing so for seven consecutive quarters. Clearly we are past the recession and now on to a steady rate of growth.
In this budget there is a long list of measures that will be very positive for Canada. We will save $3.8 billion in this fiscal year of 1993-94 and this is important for the short term. We will not raise taxes or add new taxes. We will further simplify the GST remittance system for small businesses which is important to their competitiveness and their ability to reduce the cost of doing business.
One of the highlights in the non-monetary measures carried in this budget is the further reduction of regulations so small businesses will be able to find a level playing-field and remove obstacles to their competitiveness. The happy result is that in addition to saving small business money we are also going to save the taxpayer money because the cost of administration will come down when, out of the 700 regulations we examine, we abandon one out of every four. That is the kind of positive initiative that organizations like the Chamber of Commerce and the Canadian Council of National Business have been requesting for a long time. They know

April 27, 1993
The Budget
that the paper burden and regulation for the sake of regulation reduce Canada's competitive position and make it difficult for us to take full advantage of the economic recovery opportunities that are out there waiting for us as we pull out of this recession.
We will also do something that will help individuals. I have had many people talk to me about the tax system that requires quarterly tax instalments. That will now be modified and about 300,000 tax filers will be exempt from having to file their tax claims on a quarterly basis. That will affect mainly seniors with lower incomes. At the same time it will also save us some money.
In addition to that we are going to send out GST rebates twice a year instead of four times a year. That will reduce the administrative costs to the tune of about $7.5 million a year. All of these sensible, careful measures are designed to improve our competitive position and reduce the costs of budgeting and administering our government. This is just a small example of the many progressive measures contained in this budget and I heartily applaud them.
I also applaud the winding up of eight redundant government agencies and the merging of four more. I urge that the planned privatization of the targeted Crown corporations be accomplished with all good haste because that will save us even more money.
I am also delighted to see the rationalization of program spending in the provincial jurisdictions of mining and forestry. These are sensible measures that will make this government more efficient and more responsive to the needs of the 1990s. It is time the federal government got out of provincial jurisdiction because we simply cannot afford to duplicate services and compete with one another when there is only one taxpayer out there and only one tax dollar to spend.
In spite of all this, I must say that given the national psyche that currently understands the very real imperatives of the debt, I think with some regret of what my hon. colleague might have done if the circumstances had been different and we were not at the end of a mandate, for example.
I think of the directions a new leader must be prepared to give the finance minister as early as this fall after the coming election. Real change will have to take place in the way we do the business of government, not just federally here in Ottawa but at all levels of government. Real change will also have to take place in the way people look at government and what they expect of government. Perhaps some of our sacred cows will have to be led to the slaughterhouse as we look for ways to cope with the deficit and debt.
Governments can no longer be all things to all people. We can no longer set ourselves up as our brother's keeper, taking care of people's concerns from the cradle to the grave, because we simply do not have the resources to do it. The prosperity that we thought we were enjoying in the 1970s and the early 1980s was a false prosperity based on borrowing that we did on our children's future. That must now come to an end as it always ultimately had to.
Now we must change our way of doing things and our way of looking at things. Canadians must take responsibility for their own destinies. They must understand it is not a question of what their government can do for them. The question is: what is my responsibility to myself, my participation in democracy and my fellow Canadians? How productive can I be? What can I contribute? Because it is through contribution, productivity and getting involved in helping out that we realize the full benefit of our citizenship in this wonderful country. Attitudes will have to change.
While I applaud the work of my colleague, the Minister of Finance, I want to pause for a moment to consider other possibilities. For example, this budget allows the provincial governments to continue to increase their spending at a rate of 4 per cent per year while the federal government will restrain its increases to 1.5 per cent a year, even though we expect inflation to run somewhere between 1.5 per cent and 2.5 per cent. That means no real spending federally and no real spending growth.
I ask Canadians to consider whether or not the provincial governments can continue to increase their expenditures at the rate of 4 per cent growth when we are facing this very serious and real situation vis-a-vis our total national debt. I think the provinces must take responsibility along with the federal government and the
April 27, 1993

municipalities and come together to work on these problems as a single unit rather than each going its own way because that is taking us to perdition.
If we had reduced the provincial transfers to the same rate of growth as the rest of our budget we would save $9 billion over the next five years. Coincidentally, that is about the same amount as our budgetary shortfall this year in terms of our expectations of revenues. It is a serious amount of money and I think that while we are dealing with this year's budget, if we look over the next five years I would suggest to provincial finance ministers that they begin to examine ways to cut their own expenditures in very real terms so they do not have to accept growth in transfer payments from the taxpayer who is sending part of his money to the federal government. At some point or other, if we do not get this under control, tax increases will be absolutely necessary and nobody wants that to happen, least of all the federal government.
When the finance ministers come together, as the federal Minister of Finance has pledged they will do, and I think that is a very positive thing, they are going to be forced to come to the very same conclusion that most Canadians have already reached. That is that there is only one taxpayer, regardless of how many levels of government there are, and the taxpayer is saying: "Enough is enough. Get your fiscal house in order. Do it decisively and do it now."
The budget proposes to cut grants and contributions 10 per cent this year and 10 per cent next year. It promises further reductions of 15 per cent in 1995 and 1996 and 20 per cent thereafter. That is very good and positive.
At the same time we are exempting a long list of programs such as transfers for individuals receiving veterans and Old Age Security benefits, the Canadian Jobs Strategy, selected native programs, famine relief and programs for the disabled. This is gentle and humane treatment as indeed it should be because it is part of our job to look after the vulnerable.
In addition to that we are exempting granting agencies, such as the Canada Council. Their budgets, as well as the budgets of university granting councils will be kept to the same rate of increase, 1.5 per cent, as other government spending.
The Budget
In addition, grants and contributions affecting science and technology will receive favourable treatment. I approve of that because education has to be one of our highest priorities. In fact, all of these things are high on our priority list and I respect the thinking that went into the exemptions.
However we must begin to think about our future priorities and how they will be funded. We have to make some decisions about whether or not we as Canadians are willing to give up some of our cherished but perhaps non-essential programs in order to preserve funding for things like education and health.
I noticed as the debate proceeded this morning and members opposite stood in their places and spoke, that while they had a great deal of criticism on the cuts made in this particular budget and the measures that have been taken, they had very little to offer as alternatives. They did not tell us what programs they would cut or how they would decrease their expenditures without hurting individuals.
People across the country are calling out for even deeper cuts because they are concerned about what is going to happen in the future. They are demanding that contributions to advocacy groups and other special interest groups be eliminated altogether. People are telling us that unless a program can be shown to have a net benefit to a large number of Canadians, we should not be funding it. People are saying that we all have to become more self-reliant, we have to become more independent. People are also saying that they are really tired of robbing Peter to pay an ever-greedy and hungry Paul whose rich diet is making him too heavy to carry himself alone.
I know the finance minister is a very kind and gentle man who wants to ease the pain of these cuts by making them gradually. That is why the bulk of the announced savings of $30 billion is scheduled to occur in years three, four and five. We are delighted, as I said before, to learn that there will be no new taxes and no additional taxes as a result of this budget.
I am still concerned however that our debt will continue to grow. Even with a $30 billion savings by 1997-98 we will see the debt grow to over $563 billion. This is in spite of the good news that the deficit will be reduced by then to $8 billion on an anticipated gross domestic product of $928 billion.

April 27, 1993
The Budget
I believe it is very much a question of priorities that Canadians must continue to address. In this budget, for example, we speak about constraining annual growth in government spending on international assistance by limiting increases to 1.5 per cent beginning in 1994-95. That is after taking into account the 10 per cent decreases announced in December for the coming year of 1993-94. As I said earlier, famine relief is exempted. Given the very real difficulties that many countries face, this move may seem to be somewhat harsh and it certainly is regrettable. However, I would suggest that if we do not get our finances in order we will no longer be able to borrow the money with which to support these initiatives.
On balance, this budget is a lot less painful than many of us had hoped and perhaps others had feared. It is true that the full impact has not yet been analysed. After all, $3.9 billion in expenditure cuts is not insignificant. Of course, $30 billion is even more significant. I must emphasize the importance of meeting and even exceeding these expenditure reductions in the coming five years.
Experience tells us that the fine people over at the Department of Finance have a very long history of budgetary optimism. They do not have unfortunately a particularly good record of predicting revenues.
I urge caution in accepting the premises that tell us to expect a growth rate of 4.6 per cent in 1994. I have not crunched the numbers, but I question the wisdom of bucking the consensus of private sector outlooks by rejecting a growth projection of 4 per cent and the premise that expects the gap between real output to narrow to 5.5 per cent by 1994 and close to 1.75 per cent by 1998.
There are some really big questions we have to ask ourselves: will inflation average out at 1.5 per cent over the medium term? Will employment fall to 7.5 per cent by the end of 1998? These are some concerns that I would like to voice as we look optimistically ahead on a five-year plan. There are just too many unknowns and intangibles, not the least of which is an unprecedented acceleration in technological change and a bulge in the age of the work force which was trained to meet employment patterns of two and three decades ago.
We must focus our minds on the changes we are making for this year and ask if they are going to save our credibility on the international money markets. That is what is important right now. I suggest that they are.
Perhaps the most important message sent yesterday is the one that promises an all-out attempt by the federal government to find a co-operative approach with the provinces in future budget setting. No government can act in isolation of others in the 1990s. Our competitive position will depend on our ability to act cohesively, to tackle our problems together as Canadians and not as a rag-tag assortment of political entities acting as though they were independent of one another and of the federal government. We must all work together to keep our country whole.


Ron J. Duhamel: Mr. Speaker, I would have expected my colleague to support her government's budget. I do not criticize that, but she did ask one question: what will the opposition do besides criticize? We suggested that we could cancel the helicopter project and perhaps invest in an infrastructure program for improving the sewers, roads and the other things of our cities and towns that improve the quality of life.
I want to ask my colleague some specific questions. What will this budget do for the 1.6 million unemployed Canadians, for the 2.7 million Canadians receiving social assistance, for the more than two million Canadians using food banks? I do not say that critically. It is an important question to me. How will this help them? What will it do for the middle class which is really the motor of the Canadian economy? If the middle class is suffering, then clearly the economic performance of the country will not be as good as it might be.
My final question is more specific to Manitoba. What will be the impact of this budget with respect to the cuts being imposed on regional development, the cuts with respect to VIA Rail, the cuts with respect to CBC, the cuts with respect to the mining and forestry agreements? These will all have negative job impacts in Manitoba. I am wondering if my hon. colleague would care to respond to those specific questions.


Dorothy I. Dobbie: Mr. Speaker, I always appreciate the intelligent questions of my colleague opposite. I will try to answer them; I hope I got them all down.
April 27, 1993

The Budget
He asked about the helicopters and he talked about infrastructure spending. I suggest to my hon. colleague that in fact helicopters are part of our infrastructure. Our ability to protect our coastal waters, to manage search and rescue missions, to ensure that we have integrity in the north and sovereignty are dependent on our ability to have helicopters that do not fall out of the sky because they have aged beyond the point of no return. Spending on helicopters is spending on part of the infrastructure. I would point out as my colleague mentioned not that long ago, that the money which is being spent on the helicopters, some $4.5 billion, is not being spent in one year. It is being spent over a period of 13 years. I think the impact on the budget is far less important than people may believe.
The hon. member also asked what we are doing to help with the question of employment. That is a very difficult and serious question. There are many pressures right now on the marketplace. They have to do not just with the fact that we have gone through a recession, but that we are going through some fundamental restructuring in our economy and some fundamental restructuring in the way we do business throughout the world. Part of that has to do with technological change as well as the economic restructuring. Another part of it has to do here in Canada with the fact that we have a lot more competition for jobs. Forty-five per cent of women work and that places competition and competitive stresses on traditional entrant into the work force.
We have taken measures in the December economic statement to ensure that the economy will move forward in a productive way and that recovery will gather momentum. If these predictions are correct-and I do have the same doubts I am sure my hon. friend does about predictions for five years-but if correct, unemployment will be reduced by 7.5 per cent at the end of five years. I assure the hon. member that if this government is in office it will continue to do everything it can to accelerate the pace of that change.
The hon. member also asked what this budget will do for the middle class. Again, making sure that we have our fiscal house in order is part of ensuring that our middle class, which is the largest contributor to our coffers, has an infrastructure, a government in place that
is rational and controls its deficits and leaves some options and some choices open.
As far as real spending on programs to improve conditions for the unemployed or improve conditions for the middle class, my friend must know that the options right now are extremely limited. It is a choice again of from whom do you steal to pay the other fellow. I suggest that getting the economy in order and making sure that jobs are being created, as in fact they are on a daily basis as the economy begins to grow, will do more for the middle class and the unemployed than any artificial stimulus the government might create.
Finally, the hon. member asks about cuts in Manitoba. Last night that question was asked in my presence and in the presence of Mr. Manness, the minister of finance in Manitoba. His response was the best one. He said clearly that as long as these expenditure reductions were fairly spread across the provinces he had no complaint because all of us must do our part.


Mr. Lyle Kristiansen (Kootenay West-Revelstoke):: Mr. Speaker, I have a question prefaced by a couple of quick comments for the member for Winnipeg South. I understand that we have differing views of priorities and what is right, coming from different philosophies, but we accept those even though we may argue about them from time to time.
In one case in order to defend what I firmly believe is the indefensible in this budget, the member said that the federal government was getting out of the forestry agreements because it was an example of governments competing with each other. That seemed to be the suggestion.
Maybe coming from Winnipeg she is not as aware as some other members of the nature of these agreements. They started back in 1983 I think with John Roberts in the former Liberal administration. It was a one-year program, $55 million a year from the federal government and $55 million from the province in the case of B.C.
When the present government assumed office in 1984, the gentleman who is still Minister of Forestry, who was the author of The Green Ghetto prior to that, did something that was good. He spent less money annually but got better results by negotiating these jointly administered, jointly funded agreements and got more bang for the buck. This allowed the provinces and the federal government by working together to accomplish much

April 27, 1993
The Budget
more with less money than was the case when it was done on the short term. I simply cannot understand her reference to these kinds of jointly negotiated, jointly funded, jointly administered agreements, as governments competing with each other. It is one of the best investments I have seen during all the time I have been a member of this place or simply been interested in the forestry industry or the political sphere.
It strikes me as almost an insult to the present minister when he has announced that he is leaving parliamentary life, to eliminate the federal government's share in a program that has returned more and demanded more money if we are to fulfil any commitment to the green plan or the principle of sustainable development. I believe in this case she was defending the indefensible. I would like to ask her to try to justify it or perhaps tell me that I was wrong in my interpretation of what she said.


Dorothy I. Dobbie: Mr. Speaker, I do appreciate the question. I think it is a valid one and I am glad it was raised.
The fact is that programs of this nature are not created to last forever. They do not and should not replace the natural and normal condition that would prevail, which is that forestry is a provincial jurisdiction as are all other resources. Constitutionally it is not appropriate for the federal government to spend a long time in a field like forestry.
In addition to that there are some practical implications here. There was competition, duplication and in some cases resentment because of the occupation of this field by the federal government. Not that long ago I had the occasion to be with the minister of forestry in Manitoba, actually the Minister of Natural Resources because he deals with more than forests. He pointed out to me that while he was the minister responsible for all the forests in Manitoba, he had fewer foresters in the province than did the federal Minister of Forestry, and the federal Minister of Forestry had no responsibility for forests in the province of Manitoba.
While the short-term program may have had a very beneficial effect in some areas, and certainly in my area because we do have forestry and logging and I have lumber companies in my own riding, there has to be a sunset clause on these programs. We have to back out of them when the expenditure can no longer be justified according to the long waiting list of priorities that is out there for the dollars that are available.


Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, I regret very much that I was not here yesterday to listen to the minister's speech. I was at a nomination meeting in Essex-Windsor which had been scheduled long before and could not be changed. However I must say that if there has been any budget to miss in the eight and a half years of Conservative government, any budget that one could somehow nod through and not have missed a thing, it is this budget. Aside from having an awful lot of propaganda trying to prop up failed records, this budget has absolutely nothing in it. It has no new ideas of any sort and no new initiatives. We were told that the guillotine was coming down in this budget and there was going to be a serious attempt to get control of the deficit situation in this country.
What do we find? Absolutely nothing, except a little bit of creative bookkeeping which puts the GST tax rebate for next year into the next fiscal year by paying people twice a year instead of four times a year.
That represents $625 million in savings out of the $1 billion in savings that is supposedly in this budget.
We have just been talking about the forestry industry and I must say I am struck with horror when I think of the budget and the number of trees that have been sacrificed to produce this piece of absolutely empty nonsense. It is just tragic.
We have an economic crisis here in Canada in 1993. We have 11 per cent of our population out of work, according to the official figures. A real measure of the unemployment rate might be calculated by asking how many people really want to work. We might go back and find the participation rate in the economy in a province where there was a fair amount of economic activity, like Ontario, in the period just before the recession hit in early 1990. The participation rate was about 70.1 per cent at that stage. If we were to apply that participation rate now to the whole country, and surely it is fair to do so because that is a measure of the number of people who wanted to work then and who want to work now, we see that over 17 per cent of the people in this country are unemployed. We are talking about a national catastrophe.
There has been a lot of hoo-ha about a debt crisis. The biggest debt crisis we have in this country is the one this government suffers from when it comes to ideas and compassion for those who are out of work. It exhibits an absolutely abysmal lack of care.
April 27, 1993

With that number of people out of work, the government brings forward a budget that has absolutely nothing in it to try to help those who are out of work. We have seen previous budgets that have had in my view a set of unfortunate initiatives, but usually in every case it has been possible to point to at least one or two areas where the minister of the day has tried to show some political or economic initiative to deal with the unemployment problem in Canada.
There is not even the pretence of that in this budget. There is nothing here whatsoever. You can start with the summary of the Minister of Finance about all the great things that are in this budget: "No new taxes, no tax increases. More than $30 billion in spending cuts and other measures." Of course, the spending cuts are all in the future. They do not affect the present.
There are all sort of things but not one single point is mentioned about what is going to be done about the serious problem of unemployment in Canada. In fact the only thing that is in this budget which deals with unemployment is an extension of the reduction in unemployment benefits for unemployed people into the future.
It is a heartless government that has lost touch with the realities in this country.
I stood up in the House last week in an Opposition Day debate and listed, from my constituency alone, close to 3,000 workers who had lost their jobs through the dozens of plant shutdowns that have taken place in the Windsor area. Is there anything in this budget that attempts to respond to the concerns of those people? There is not a thing.
In addition, we have to say there are some usual petty, nasty, wicked little hooks in this budget as there have been in every Conservative budget that has been produced since this government came into power.
In this case it has taken the GST rebate which goes to poorer families in this country who were promised it
The Budget
would be given four times a year to offset the increased burden of the GST and said: "We are going to do away with four times a year. We are going to make it just twice a year." There is no recognition of the increased problems that will cause for poorer families in Canada.
On top of it all, these great deficit fighters on the other side of the aisle have brought forward in their last budget a deficit that is higher than the deficit they projected for their first budget in 1985. In other words, we have had almost nine years of Conservative rule in this country by people who are mesmerized by the deficit. Despite all its rhetoric, fuming, excuses and close to 40 new taxes it has put into effect to hit Canadians, the government has to project a higher deficit in its last budget than it could project in its first budget in 1985.
Mind you it is consistent with previous Conservative budgets too. This budget, like all Conservative budgets since 1985 is really good at dealing with the deficit problem five years down the road. If we believe in Alice in Wonderland and like to read our kids fairy stories we could find all sorts of material in this budget. Suddenly, miraculously, the Canadian economy is going to start growing at 4.5 per cent per year. It does not say how. It is going to happen. It will be 4.5 per cent per year.
This remarkable, miraculous growth is going to create a reduction in the deficit. Suddenly by 1998, safely down the road, the borrowing requirements of this government are going to be eliminated. This is the first step toward eliminating the deficit.
It is funny. If you go back to the first budget of the Conservatives in 1985, they were going to have reached that no borrowing position by this year, 1993. Here we are in 1993 and what do we have? We have a bigger deficit than in the first year that the Conservatives presented a budget.
Talk about mismanagement, talk about the tooth fairy, talk about Alice in Wonderland. Anybody who believes the statistics presented in this budget needs to be taken to the Clarke Institute in Toronto and given an extensive series of shock treatments.

April 27, 1993
The reality is that there is virtually nothing in this budget that will help with any of Canada's problems whatsoever. I have to admit there is one good thing that I have managed to find in the course of 94 pages, one good point. That is the suggestion that we should merge the National Advisory Council on Aging and the National Council of Welfare. That makes sense, but the government says it is also going to do away with all sorts of other committees which it turns out do not have any members anyway so it is awfully easy to get rid of them. That does not prove very much.
It is a budget without a hope of doing anything to help people in this country. By bringing this budget forward at this time the Conservatives have lost the chance in the final budget they will present, I hope for a generation, to keep some of the promises they made, such as the promise to set up a national child care program.
I had people speaking with me this morning from child care advocacy groups across this country, not just the parents but some of the children who have benefited so much from national child care efforts in the past in Canada. They left me some of their very well-presented propaganda. It makes the case very well that we need a national child care program in this country. We need a program to put people to work in the child care area but above all we need a program that will help children by providing high quality child care throughout Canada.
Our New Democrat jobs program makes a commitment to such a child care program for Canada but this government, despite its promises in the last election, has refused to come through.
This government promised to help small business, but again it has not done so. We have argued that we need a national investment fund in this country for Canadian-owned businesses so they would have access to the capital they need to expand their activities through venture capital.
We have argued for a commitment to work force training. We have argued for encouragement of employee ownership where feasible and tightened research requirements on foreign investment. All of those things could have been part of this budget without any extra expenditure of money in many cases. Yet there are no
new ideas, no new initiatives, and no new hope for Canada's unemployed.
I wonder if I could call it two o'clock?


The Acting Speaker (Mr. DeBlois):: It being 2 p.m., the House will now proceed to statements by members pursuant to Standing Order 31.


STATEMENTS PURSUANT TO S. O. 31
Mr. Guy Saint-Julien (Abitibi):: Mr. Speaker, an article published in the newspaper Les Affaires of April 17, 1993, says that "the federal government delivered the goods in Quebec, through the Canada-Quebec agreement on regional development."
Indeed, the Conservative government provided $440 million out of a total of $820 million, over a period of five years which started in 1988.
Canada also delivered the goods as regards budgets. Moreover, the federal government added $130 million to bail out, over the next two years, programs for which financing had ended. We are not veiy concerned with criticism made in some regions, to the effect that the amounts announced were only partially spent.
As of February 28, 1993 the federal government had committed $26.62 million out of a total of $35 million in the northwest region of Quebec. On the other hand, as of December 31,1992, the Quebec government, through this same agreement on the northwest region of its province, had only committed $12.3 million out of a total of $40 million.


THE BUDGET
Mrs. Marlene Catterall (Ottawa West):: Mr. Speaker, Canadians are longing for a revival of confidence in their country, renewed hope for their future and brighter prospects for their children. On farms, in small towns, in factories and in homes Canadians expect better for the 39 new taxes they have faced under this government than they received yesterday.
April 27, 1993

This government cannot seem to grasp that it is not a question of more government or less government but of good government. It is a question of effective public services delivered at a price the country can afford by a Public Service that has the talent and tools it needs to do the job that Parliament has told it to do.
This calculator budgeting that comes up with arbitrary percentage or dollar cuts simply is not delivering the value that Canadians expect for the increased taxes they are going to continue paying into the future.


JACK WALTERS
Al Johnson: Mr. Speaker, last Friday I met with a number of outstanding but distraught young athletes who are members of our national speed skating team. They expressed to me their dismay that their coach, Jack Walters, had been fired by the Canadian Amateur Speed Skating Association.
Throughout the past 20 years, 12 of which he spent coaching Gaetan Boucher, Jack Walters has earned the respect and admiration of the national and international speed skating community as one of the world's finest coaches.
This extraordinary reputation is due to the mutual trust, confidence and respect between him and his athletes, outstanding results and his willingness to share his progressive and innovative ideas among the national and international community of coaches.
Canadian taxpayers pay 70 per cent to 75 per cent of the Canadian Amateur Speed Skating Association's costs. On their behalf I ask the minister to get involved and if appropriate to appoint a facilitator so that our young athletes can be assured that petty politics and bureaucratic muddling are not threatening their chance to achieve the goals they have set for themselves on behalf of Canada.


THE ECONOMY
Mr. Maurizio Bevilacqua (York North):: Mr. Speaker, over the past nine years the Conservative government
has asked us to make sacrifices in order to fight the federal deficit and the federal debt, help future generations, develop a globally competitive economy and improve our quality of life, and we have.
Canadians placed their trust in this government. Since the Conservatives took office in 1984 the federal debt has more than doubled to $460 billion. They have consistently posted annual deficits in the $30 billion range. The tax burden on the hard working middle class family has increased to 44 per cent of their income. Over 1.5 million Canadians are unemployed, among them are over 430,000 young people; 30 per cent of our high school students continue to drop out; 2.2 million live on welfare; 2 million rely on food banks; and violent crime has gone up 40 per cent. Tory times are tough times.


THE BUDGET
Iain Francis Angus: Mr. Speaker, the real failure of this government is that it does not understand what truly holds Canada together. Our national institutions make this country viable, institutions like the CBC which allows us to learn about each other, VIA Rail which enables us to visit each other and Canada Post which allows us to communicate with each other.
Yesterday's budget makes it obvious that the Tories are plotting the death of VIA Rail. These latest cuts will force VIA to cut routes and services and make it much more difficult for VIA to acquire the new equipment it will soon need just to function.
While VIA officials will work hard to minimize the effects of these cuts, there is no question that the lower the ongoing investment in rail passenger service the smaller and less frequent VIA will become. This country is too big to leave the funding of rail passenger service to the marketplace.
If we are to continue to have rail passenger service from coast to coast the Canadian government has a role to play. It is not constitutions that keep this country together but people communicating with each other by radio, by television, by letter and through transportation that is affordable and accessible.

April 27, 1993


SHIPS COMPANY THEATRE
Mr. Bill Casey (Cumberland -Colchester):: Mr. Speaker, the Ships Company Theatre was established several years ago in the town of Parrsboro, Nova Scotia. Its impact has been felt throughout the Parrsboro shore as it attracts people from several provinces nearby.
It is established in a dry-docked ferry boat called the Kipawa which creates a unique atmosphere and is very conducive to the setting and appropriate to the productions.
The Parrsboro shore area is now experiencing a small boom in tourism and this theatre group was the main original building block which helped to attract many of the other tourism facilities under construction.
The Ships Company Theatre is now applying to the federal government, the provincial government, and the municipality for assistance in funding to allow it to continue to survive and prosper.
Canada Employment has recently announced a section 25 grant to help it upgrade its facilities, which is a start. Applications will be made to ACOA and the Department of Communications, as well as to the province, to assist with a relatively small amount of funding to ensure this continues.
I strongly support the Ships Company Theatre in its efforts to resolve its financial challenges and will be endorsing its applications whole-heartedly.


THE BUDGET
Hon. Alan Redway (Don Valley East):: Mr. Speaker, yesterday's budget was good news for senior citizens in my constituency and across Canada. Currently an individual must remit quarterly income tax instalments if both their prior year and current year federal tax liability is more than $1,000 and less than three-quarters of their current year's net income is subject to withholding tax at source.
Effective September 15, 1994, an individual will be required to pay instalments only if the difference between the tax payable and the amount withheld at source is greater than $2,000 in both the current and either of the two preceding years.
This means that some 300,000 people, a great many of them seniors, will no longer be required to make quarterly income tax instalment payments. That is great news for seniors.



Mr. Jim Peterson (Willowdale):: Mr. Speaker, Canada's economic future is in grave doubt. Since 1984 manufacturing productivity has grown at only two-thirds the rate of the G-7 and under this government our high-tech trade has fallen from a surplus of $1 billion to a $30 billion deficit.
Since 1989 we have fallen from fourth to eleventh place in the world in terms of our ability to compete. We have lost 16 per cent of our manufacturing jobs and our unemployment rate is stuck at 11 per cent.
Yesterday the government's challenge was to offer policies to help Canada compete as a high-wage nation and create jobs. It failed to address our deficiencies in education, training, numeracy, literacy, science and technology, and research and development.
It offered nothing to help small businesses expand, to assist manufacturers with productivity, exports and quality, or to help our primary industries add value here in Canada.
This budget is a prescription for our continuing economic decline. This government continues to fail us miserably.


CONSUMER AFFAIRS
Mr. Ross Belsher (Fraser Valley East):: Mr. Speaker, I would like to congratulate Consumer and Corporate Affairs Canada for its innovative and dynamic approach toward the safety of older consumers during this National Consumer Week.
We should keep in mind that each year over 3,000 seniors die and over 67,000 more are hospitalized as a result of an injury. In 1986 injury related expenditures were estimated at $11 billion and injuries are currently the second leading health care problem. Injuries involving consumer products are of particular concern to seniors because of the severe impact they have on their quality of life.
April 27, 1993

As the Canadian population continues to age the number of injuries and related deaths and associated health costs will significantly increase.
The department has introduced initiatives to reduce product related injuries suffered by seniors in their homes. It is working with industry and seniors' groups to make industry aware of the product and packaging needs of the seniors.
The Canadian Seniors Packaging Advisory Council, CSPAC, was established to address seniors' packaging needs. A national working group was formed to promote products of universal design. Such consumer products will make life easier not only for seniors but also for all Canadians.


THE BUDGET
Mr. Rod Murphy (Churchill):: Mr. Speaker, in Monday's budget this government announced that it will not renew the federal-provincial economic and regional development agreements in the areas of forestry and mineral resource development. This is bad news for Canadians who rely on the mining and forestry industries.
In Manitoba this announcement means the loss of $5 million in federal funding for mineral development and $15 million for forestry. How does the government think that Manitoba and the other provinces will make up this difference?
Although the federal government has not given up its constitutional obligation to forestry and mining these cuts reduce any federal influence in these important areas. The federal government has a role to play in the forestry and mining industries. The government's decision to pull out of these areas is disgraceful and will hurt thousands of working people and hundreds of communities right across Canada.


CONSUMER CREDIT
Dorothy I. Dobbie: Mr. Speaker, I too would like to mention National Consumer Week.
This year the federal government is highlighting the importance of consumer credit during National Consumer Week so that consumers can act with full knowledge when they use the credit options available to them.
It seems clear that the marketplace conditions affecting the use of credit have undergone fundamental changes and that these conditions are likely to persist. For example, while some types of consumer debts have declined from their recent peak level the use of consumer credit is still more common than it was a decade ago.
Another change involves the misuse of credit and particularly credit cards. To address this problem, there is a need for more informational and educational initiatives which will reduce levels of serious indebtedness and, in some cases, prevent personal bankruptcies.
As this is a complex and serious matter, the Minister of Consumer and Corporate Affairs is communicating his concerns to the provinces and credit grantors. He is asking them to provide their ideas on how problems of excessive indebtedness can be prevented and how the importance of the wise use of credit can be effectively communicated to consumers.
In addition to co-operative action with provincial governments and credit grantors we will continue-


The Acting Speaker (Mr. DeBlois):: I am sorry but the member's time has expired.


NATIONAL DEFENCE
Mr. John Brewin (Victoria):: Mr. Speaker, yesterday the government failed to cancel the $5.8 billion helicopter purchase and replace it with a cheaper alternative more in keeping with Canada's post cold war role.
The government failed to initiate necessary base closings through discussions with local communities. The government failed to respond to a UN call for a 3 per cent per annum cut in defence spending so that the world can tackle Third World development problems and global environmental issues.
Instead, the do-nothing, no-change Minister of National Defence carries on as if the cold war never ended, as if the Berlin wall still stands. Surely it is time for a

April 27, 1993
peace dividend. Surely it is time for this government to
go-


OFFICIAL LANGUAGES
Mr. Greg Thompson (Carleton -Charlotte):: Mr. Speaker, I wish to congratulate Premier Robert Bourassa of Quebec and his party leadership.
Last weekend Quebec Liberals gave Premier Bourassa the green light to allow English on commercial signs at a policy convention. The sign law in place for the past 15 years has banned languages other than French on most signs and obviously has strained relations between Quebec and the rest of Canada.
The law could be scrapped by the Bourassa government as early as June. This should help ease relations between New Brunswick, Canada's only officially bilingual province, and the province of Quebec.
This is obviously a move in the right direction and Premier Bourassa has to be commended.


THE BUDGET
Deborah C. Grey: Mr. Speaker, yesterday's budget was an abominable insult to Canadians and a pathetic attempt at deficit reduction.
In fact the budget will increase spending by $13.4 billion over the next three years, if the Conservative Party is around after the next election to implement the necessary legislation.
Are Canadians supposed to get excited about the fact that there were no new taxes? This is little consolation for the average working man and woman who have seen their taxes rise by 26.7 per cent since these deficit dragoons took power in 1984.
What Canadians need is not a stay the course, do-nothing cop-out but a real deficit reduction budget from a real government. The Reform Party's zero in three plan offers the only real alternative for deficit reduction and a secure future for our social safety net. No other party in Canada as witnessed by yesterday's budget takes the deficit crisis seriously. Let us hope the government never gets the opportunity to put its lack-lustre bankruptcy plan into practice.
*
*



Hon. Roger C. Simmons (Burin-St. George's):: Mr. Speaker, this government hates Newfoundlanders.
Translation]



[Stage Direction]
That is one of the clear messages in yesterday's budget. How else can we explain that onslaught on forestry, the fisheries and the mineral agreements?
The government has done enough over the last eight years with its high dollar and its high interest rates which have caused the loss of jobs by the thousands in Newfoundland, in the mining sector, the forestry industry and the fishery, but there are still a few jobs left down there.
It had one more go at it yesterday in that budget to see if it could wipe out the few remaining people down there who are still working for a living, who have survived so long despite the despicable policies of this government.
Newfoundlanders have had enough from you fellows and they will let you know when the election comes.
Marcel R. Tremblay: Mr. Speaker, provincial transfers are not affected by the cuts announced yesterday.
To force transfer cutbacks on the provinces would interfere with their own efforts to deal with the debt and deficit problem.
With the 1993 budget, the government is responding to Canadians who have been requesting that governments work together to tackle the national debt and deficit problem.
The Minister of Finance has convened his provincial colleagues to a special finance ministers' conference to be held on May 30 and 31, to start working on a common strategy to deal with the national debt problem.

April 27, 1993



Mr. Alfonso Gagliano (Saint-Leonard):: Mr. Speaker, the budget tabled by the Minister of Finance yesterday is a useless and meaningless budget which does nothing to remedy unemployment or poverty.
Again, the minister is attacking the old and the poor. The GST credit is currently paid four times a year but, come January, families expecting to receive their cheque as usual from the government will have to wait another three months.
Such a measure is nothing more than an accounting trick and it unfairly penalizes low-income families. The government had promised that the GST credit would be paid often, sometimes even ahead of time to help those in need.
I think this measure is unfair and I ask the Minister of Finance to withdraw it.



ORAL QUESTION PERIOD


Herbert Eser (Herb) Gray: Mr. Speaker, I have a question for the Minister of Finance.
After years of double digit unemployment and with 1.5 million Canadians still looking for work the best the government can do in its budget is to have 11 per cent unemployment this year and about the same level next year.
I ask the minister: where is the plan for economic growth and job creation that would bring unemployment down substantially this year and next? Will the minister admit the reason he does not have a plan for jobs in his budget is that it is designed to help the political needs of the Conservative Party and not the economic needs of Canada?


Hon. Don Mazankowski (Deputy Prime Minister and Minister of Finance):: Mr. Speaker, this is a realistic, responsible and achievable budget. It builds on the initiatives of the December statement to bolster growth and to invest in people and infrastructure. I draw attention to the economic statement wherein it indicates that in fiscal year 1993-94 some $1.1 billion will be spent
Oral Questions
on bolstering the economy. In 1994-95 there is another $1 billion.
The personal income tax reductions and the child benefit credit inject $1.7 billion into the economy this year. We have in place a special two-year home buyer's plan. We have reduced the manufacturing and processing tax rate. We have increased the capital cost allowance for manufacturing and processing. We have streamlined research and development. We have removed the withholding taxes.
We announced an infrastructure program that is generating 15,000 person-years of work now and another
15,000	in the future. We have provided measures to assist small business. We have increased the business loans under the Small Businesses Loans Act. We have provided UI premium relief for new jobs. We have a small business investment tax credit.
All of these initiatives are taking hold and have created 200,000 new full-time jobs since August.


Herbert Eser (Herb) Gray: And after all this, Mr. Speaker, the minister in his own budget says that unemployment will remain at the tragically high level of 11 per cent this year and 10.6 per cent next year. Is that not an admission of failure?
My supplementary question to the minister is this: today the Prime Minister's office announced a detailed plan for the Prime Minister's farewell tour of Europe. Why is it possible for the government to design a detailed plan for this farewell tour and impossible for the government to design a detailed plan in its budget to quickly put 1.5 million Canadians back to work?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, I will give you an idea of the seriousness of the ideas on the other side of the House.
As Prime Minister of Canada, I have accepted an invitation from President Yeltsin to visit with him in Russia in respect of the G-7's attempts to contribute to the stabilization of the former Soviet Union. Canada's per capita contribution is second only to that of Germany and our arrangements for the Vancouver summit have been with that in mind.
Our meetings with Chancellor Kohl deal principally with the reignition of the GATT talks and their impor-

April 27, 1993
Oral Questions
tance to Canada. The new Prime Minister of France, Edouard Balladur, has invited us, given the importance of France to Canada, particularly in regard to our foreign policy. These are important and significant steps to take.
I find it difficult to understand that my hon. friend, as a Privy Councillor and a member of a former government whose Prime Minister in 1984 took trips to Romania, East Germany and half-way around the world, would seek to trivialize an important initiative on behalf of the Government of Canada.
If my hon. friend has some better ideas in regard to the budget, let him bring them forward but he should not try to trivialize Canada's important initiatives in foreign policy in this manner.


Herbert Eser (Herb) Gray: Mr. Speaker, the Prime Minister seems uncommonly sensitive about this point. I am wondering if he is going to take Mr. McCutchan with him. That would be some proof that it is a serious trip.

Mr. Speaker, my third question is directed to the Minister of Finance. In its budget, the government plans to spend $5.8 billion to buy military helicopters while at the same time making drastic cuts in social housing and regional development. I want to ask the minister why this government has such a distorted sense of priorities? Why?


Donald Frank Mazankowski: Mr. Speaker, if the hon. member looks at the expenditure cut projections, he will find that there are some $5.9 billion worth of expenditure cuts to the Department of National Defence budget. If that is taken over the period from 1989-90 right through until 1997-98, it will be found that there have been cuts of some $14 billion in the defence budget. I think that is pretty substantial.
Clearly with respect to social housing, we are still going to be supporting social housing at the level of some $2 billion. Any new housing initiatives will have to be funded out of expenditures that are available for that given year. We cannot continue to provide the 35-year subsidy provision that layers up the cost exposure and establishes a liability for future generations. Every $40
million worth of investment in social housing works out to about $1.5 billion worth of exposure.
These are some of the things we have had to deal with. We have to live within our means and we have to adjust the mechanisms and the institutions available to deal with the reality of severe fiscal restraint.


Paul Edgar Philippe Martin: Mr. Speaker, my question is for the Minister of Finance.
Everybody recognizes that small and medium-sized businesses are the main vehicles of growth and job creation in Canada. This budget was the last chance for this government to make a concrete proposal to our business people but it failed to seize that opportunity.
Once again, why did the Minister of Finance refuse to suggest an action plan allowing Canadians and small and medium-sized businesses to develop new products, export them all over the world, and win the global economic battle?


Donald Frank Mazankowski: Mr. Speaker, I think the hon. member is quite aware of the initiatives we took in the December statement.
I repeat that this budget builds upon the efforts in the December statement both in terms of policy and in terms of expenditure reduction. I might add that those expenditure reductions enunciated in the December statement have been enshrined into law. What we are doing here is extending those expenditure reductions and indeed deepening them.
With respect to small business, I think the best news for the small business sector is that there are no new taxes or no tax increases. I know that my hon. friend is disappointed about that because they are the party of high taxes, high spending and high deficits.


Some hon. members:: Oh, oh.


Donald Frank Mazankowski: What we have are a number of initiatives to assist small business. The Small Business Financing Program is extended. We have increased the maximum loan limits and changed the Small Businesses
April 27, 1993

Loans Act so it can be more effective. We have increased the labour-sponsored venture capital corporation credit, the UI premium relief for new jobs, new small business investment tax credit and assistance to the small oil companies which is really having a very positive effect. Indeed, there are steps to further reduce the compliance burden with respect to the GST. All of those things are very welcome in the small business community.


Paul Edgar Philippe Martin: Mr. Speaker, if the minister really believes that, he has been away from the small business sector for far too long. The problem with his budget is that it does not just build on last December's statement, it builds on nine years of failure.
The minister talks about what the government is prepared to do for small business. The minister ought to know from his own background that the biggest problem small businesses face is the lack of capital. What is the government's response to lack of capital? Let me quote from this great document. The minister says: "We will explore ways to develop mechanisms to encourage investors," whatever that means. After countless studies and commissions, the Porter report, the prosperity initiative, that is a sentence riddled with cliches. Is exploring mechanisms the best thing this government can do to encourage small business?


Donald Frank Mazankowski: Mr. Speaker, the hon. member knows that the small business federal tax rate is the lowest tax rate applied to small businesses in any country in the world. That in itself is a very important element.
We have the lowest interest rates in 20 years and the lowest inflation rate in 30 years. That is helpful. The Small Businesses Loans Act was indeed overhauled through an extensive consultation process. Indeed members opposite, his own colleagues, helped in that process. We got a good package, one the banks have responded to positively. For example, the Royal Bank, the Bank of Nova Scotia and the Toronto Dominion Bank have all responded very positively by providing extra premium rates for the Small Businesses Loans Act. They are also suggesting that more than $1 billion of new capital will flow to the small business sector in 1993 and that is good news.


Audrey Marlene McLaughlin: Mr. Speaker, my question is for the Minister of Finance. Listening to the
Oral Questions
answers so far today, it is clear this is a pretty tired government in need of a period of long hibernation. The next election should provide that.
When it comes to the most serious economic issue facing Canadians, the job crisis, the government has chosen to do nothing but to accept 11 per cent unemployment this year and double digit unemployment next year. We see that one in four Canadians is unemployed, underemployed or has given up hope in this country. Hope is desperately needed.
Europe, Japan and the United States, major trading partners, have come out with jobs plans for their countries. In the case of Europe it is a jobs plan for countries of the European Community. This is a jobs plan for economic renewal.
Why is the government content in this budget to simply ride on the coat-tails of other governments? Why has the government not come out with a positive jobs plan that will give Canadians hope?


Donald Frank Mazankowski: Mr. Speaker, there is in place right now an expenditure of $1.1 billion in this fiscal year and $1 billion plus in the next fiscal year to help bolster the economy from infrastructure to training and skills upgrading, to incentives for small business, to encouraging more trade and in particular to ensuring that the trade initiatives that have been so successful in creating more export demand are carried out and transformed into jobs.
I should advise the hon. member that since November employment growth has been growing at an annual rate of 2.8 per cent. That is higher than we had expected in this budget in which we predicted 1.7 per cent this year and 3 per cent next year.
I remind my hon. friend that we have had 200,000 new full-time jobs created since August, 48,000 new jobs last month and 26,000 new jobs in the manufacturing sector. There are clear signs of pick-up both in the manufacturing sector and in the export sector and hopefully soon in the domestic demand sector.


Audrey Marlene McLaughlin: I have a supplementary question, Mr. Speaker. I remind the minister that the unemployment rate remains at 11 per cent. That is the official unemployment rate. The unofficial rate is

Oral Questions
much closer to about 19 per cent and youth unemployment is close to 20 per cent.
I say to the minister that he can stand in this House and say that his policies have created more jobs, but his policies have created more devastation in the last nine years in this country and we needed to see a budget to change that.
The government has addressed the issue of the deficit many times, although in this budget projection the deficit will not even decrease in the coming year. One of the major causes of deficit, in addition to the bad trade policies of this government, the high interest rate policy of this government and the GST, is high unemployment. Of course we have declining revenues with a declining number of people working.
Why does the government refuse to acknowledge that the deficit is simply a symptom of an economy that is not working? Why does it not recognize that for a country to work the people of that country must be working?


Donald Frank Mazankowski: Mr. Speaker, I agreed that a healthy economy and lots of jobs is really the ultimate. That is what we are really trying to do.
We do have a recovery that has been slow in coming, but we have facilitated that recovery by the measures that we have taken. At the same time we have to deal with the deficit. We have tried to strike a balanced, responsible, realistic and achievable position, not to be bloodthirsty or Draconian, not to tackle the provinces, not to tackle senior citizens or veterans. We have attempted to adopt a responsible course of action, one that is achievable.
I can tell my hon. friend that I believe what we have laid out in the five-year program is achievable and will get us to a level of zero cash requirements at the end of the five-year period. Our deficit as a percentage of GDP will be .9 per cent. That is down from 5.1 per cent as it is today. We will have the lowest expenditures of government in more than 30 years at 13.9 per cent.


Audrey Marlene McLaughlin: Mr. Speaker, I have a supplementary question for the minister. The projections of the minister for the future rival those of the psychics in The National Enquirer. Indeed, I think they have actually had better success with their predictions than the minister.

I have a question for the Minister. The government has made choices. It chose to ignore unemployment; it chose to attack programs which were important for ordinary people, such as subsidized housing, regional development, transportation subsidies, the CBC, and organizations assisting the underpriviledged. Instead, the government could have ended private family trust exemptions and deductions for business entertainment expenses.
Why does the government keep asking sacrifices from ordinary people rather than from the rich?


Donald Frank Mazankowski: Mr. Speaker, the hon. Leader of the NDP takes issue with our projections.


Nelson Andrew Riis: Everybody does.


Donald Frank Mazankowski: Her House leader says: "Everybody does." I just received a document from New York entitled "High Frequency Economics," which is distributed around the world, issued today, April 27. This is what it has to say about the budget: "We think this is an achievable budget. We like this budget. There is a medium term plan of deficit reduction here. Growth assumptions and revenue projections seem to us to be realistic and even conservative."


Mrs. Diane Marleau (Sudbury):: Mr. Speaker, I think the finance minister had to go a long way to find that clipping.
My question is for the same finance minister. In this do-nothing budget that he put out last night projections for high levels of unemployment over the next few years confirm the human tragedy of this Conservative administration. The only recovery this government seems to be committed to is a jobless one.
Why have this minister and this government refused to include any new encouraging job creation programs in this budget?


Donald Frank Mazankowski: Mr. Speaker, the hon. member suggests that I had to look high and low for that quote. I will give her another one that came out of The Financial Times this morning.
April 27, 1993


Some hon. members:: Oh, oh.


Donald Frank Mazankowski: Of London.


Brian Vincent Tobin: You had to look far for that one.


Donald Frank Mazankowski: It reports-


Brian Vincent Tobin: How about The Globe and Mail of Canada? How about The Toronto Sun?


Donald Frank Mazankowski: It reports on the latest forecast of the IMF. Will that interest you now?
It points out that for 1993 the growth forecast for Canada is 3.2 per cent; for the U.K. it is 1.4 per cent; for Italy, .3 per cent; for Germany, minus 1.3 per cent; for Japan, 1.3 per cent; and the United States, 3.2 per cent.
I could go through the same litany for 1994 which means that Canada will have the best growth rate in the G-7. Surely they are interested in that. That fully supports the projections I made in the budget.


Diane Marleau: Mr. Speaker, if the finance minister looked at some of the Canadian headlines maybe he would get some idea of what people are really thinking.
Let us stop all this talk. Governing is a matter of choices. This government and this Minister of Finance had a choice. This government and this Minister of Finance chose to do nothing except to utter empty phrases and to accept unacceptable double digit levels of unemployment.
How can this government ignore the desperate need of Canadians for jobs?


Donald Frank Mazankowski: Yes, Mr. Speaker, governing is about choices and governing is about making difficult choices. In some cases we have to exercise restraint.
I must say that on every single solitary occasion we brought forward restraint measures to the House of Commons the Liberal Party voted against it and the NDP voted against it. So much for talking about the level of restraint.
Clearly a number of initiatives have been put in place as a result of the December statement. This budget builds on the December statement. It continues the expenditure reductions but it also continues the support in those particular areas of the economy that need strengthening. That is where the jobs are being created.
Oral Questions
That is why we are optimistic about achieving 7.5 per cent level in unemployment by 1997-98.


Mr. John Manley (Ottawa South):: Mr. Speaker, my question is for the Minister of Finance.
Yesterday in his budget he predicted a $32.6 billion deficit for the current year. That is up from previous predictions of $16.6 billion in 1991, $14 billion in 1990, and $15 billion in 1989. Furthermore, the minister's projection last year for the year just ended was off by a mere $8 billion.
In a budget devoid of strategy for economic growth and new jobs, how can the minister expect Canadians to take seriously the deficit projections he has put in this year's budget?


Donald Frank Mazankowski: Mr. Speaker, I just quoted one economic analyst and I will quote him further. He says: "We estimate that growth alone should push the policy neutral budget deficit down toward $28 billion." That is his assessment.


Some hon. members:: Who, who?


Donald Frank Mazankowski: I appreciate the question of the hon. member. He is always genuine and always offers constructive criticism, and sometimes even some constructive suggestions.
We have just gone through an exchange with his colleagues where they were asking us to spend more money and to further enhance the level of the deficit, to bring it up higher.
The hon. member knows very well that because of the recession and the global economic slowdown we have had a shortfall in revenues of some $9 billion in 1992-1993. We project that similar shortfalls in revenues will be expected in the other years as well.
What we have done here is we have constrained expenditures. As a matter of fact we have brought them down by about $900 billion from where we originally were. We are exercising prudence and restraint on the expenditure side. What we are doing is trying to bolster economic growth-


Mr. Speaker:: I think we must move on.


John Paul Manley: Mr. Speaker, yesterday's budget, I am sure the minister taking all those

April 27, 1993
Oral Questions
assumptions aside would agree, has some pretty optimistic growth forecasts in it. It projects a deficit of $8 billion five years from now.
The Minister of the Environment says that he can reduce the deficit to zero in four years. The Minister of National Defence says that she can reduce it to zero in five years.
I would like the minister to explain whether his colleagues are naive and unrealistic about reducing the deficit, or is he telling Canadians that this particular budget is a stand still, do-nothing budget just to buy time until the Tory leadership convention is over?


Donald Frank Mazankowski: Mr. Speaker, respecting our goals and objectives with respect to bringing down the deficit, particularly as a percentage of GDP because as my hon. friend knows that is the one that counts, we intend under this plan to bring the deficit as a percentage of GDP down from 5.1 per cent to .9 per cent.
I note that his leader suggests that 3 per cent would be a logical and acceptable figure. In other words he is saying it would be okay to have the deficit as a percentage of GDP running at 3 per cent, which would maintain a deficit of about $25 billion.
That is not good enough for us. Zero cash requirements is what we are after. A .9 per cent deficit to GDP ratio is what we are after and the lowest level of government expenditure in 30 years. That is what we are after and that is what our objectives will achieve.


Mr. Howard McCurdy (Windsor-St. Clair):: Mr. Speaker, my question is for the Minister of Finance.
Most independent agencies forecast unemployment at greater than 10 per cent for the decade and growth at around 2.5 per cent. The wizard of finance conjures growth at 4.25 per cent and unemployment at 7.6 per cent by 1997-1998.
Considering the accuracy of previous forecasts, in the first budget they said there would be no deficit at all by now, and as recently as 1991 they underestimated the budget by nearly $11 billion.
My question is as follows: would it not be reasonable for the 1.5 million unemployed to conclude they are out of work because this government does not know what it is talking about and it does not know what it is doing?


Donald Frank Mazankowski: Mr. Speaker, indeed I think we all have to acknowledge that the recession was deeper and longer than expected.
When we look around the world in terms of the global economy, we see Japan's growth at 1.3 per cent, Germany at minus 1.3 per cent, Italy at .3 per cent and the U.K. at 1.4 per cent. We are a part of the global economy. There is no question about that.
The hon. member says my figures and my forecast are unrealistic. The objective analysts from New York suggest-


Mr. Blackburn (Brant):: In the Village Voice.


Donald Frank Mazankowski: -again that the budget is delivering the fruits of structural change in public financing undertaken in recent years and which were not harvested because of the prolonged recession. There is a medium term plan of deficit reduction. Growth assumptions and revenue projections seem to us to be realistic and even conservative.


Steven W. Langdon: Mr. Speaker, I have a very serious question for the Prime Minister.


Some hon. members:: Oh, oh.


Mr. Speaker:: The hon. member will please put his question.


Steven W. Langdon: Mr. Speaker, in the 1988 election campaign this government promised a national child care program. Yesterday's budget was the last chance for the Prime Minister to come through on this promise to Canadian children.
I want to ask why this government and this Prime Minister have broken this promise and why there is no move in this budget toward a national child care program for our kids.


Martin Brian Mulroney: Mr. Speaker, my hon. friend is indulging in revisionism.
This House passed a national child care program in 1988 and it was killed in the Senate by the Liberal Party.


Some hon. members:: Oh, oh.


Martin Brian Mulroney: It was killed in the Senate-


Ms. Clancy:: Not a good program.
April 27, 1993


Ms. Copps:: Bring back Mickey Mouse.


Mr. Speaker:: The right hon. Prime Minister.


Mr. Andre:: By the kazoo blowers over there.


Martin Brian Mulroney: Mr. Speaker, my hon. friend the member for Kamloops was a member of the House here at the time. He will remember full well that indeed the House of Commons voted for a national child care program in 1988 and it was killed by the Liberals led by the Hon. Allan MacEachen in the Senate. The Liberal Party of Canada killed a national child care program and you will pay for it forever.


Mr. Reginald Belair (Cochrane-Superior):: Mr. Speaker, yesterday's announcement of major cuts to regional development has resulted in the unjustified cancellation of the Forest Development Agreement funding which is a major factor in Canada's goal to attain sustainable forest development.
This irresponsible Conservative government does not realize the impact that this cancellation will have on rural Canada and much more to the forest industry which cannot absorb those cuts. Furthermore these agreements have created 20,000 jobs across this country and have funded the planting of one billion seedlings.
My question is this. Can the minister justify to this House the motives behind his decision to abandon the forest industry?


Donald Frank Mazankowski: Mr. Speaker, the hon. member should clear his question with the hon. member for Ottawa South. He takes a completely different approach and he is sitting right behind him snickering and grinning. He really knows that it is quite an embarrassment.
The hon. member for Ottawa South is a very responsible member. I admire him and respect him very much. So is the hon. member for Timmins. I wish you folks would get together. The issue here is not that the federal government is withdrawing support of the forestry industry. We are there in research and development and we are there in the promotion of exports. A time comes when we have to exercise restraint in many areas and this is clearly an area that falls generally within provincial jurisdiction. Most of the royalty revenues, something in the order of $850 million, accrue to the provinces. This clearly is an area where if the provinces wish to support
Oral Questions
this sector further they will certainly have the opportunity to do so.
Mr. Francis G. LeBlanc (Cape Breton Highlands -
Canso): Mr. Speaker, my question is also for the Minister of Finance.
The cuts to regional development funding announced in yesterday's budget continue this government's cynical abandonment of Atlantic Canadians. ACOA, the agency that this government created to promote Atlantic development, has been repeatedly gutted.
The decision not to renew the forestry and mineral agreements and to review the other co-operation agreements signals a further loss of millions of dollars in federal support to Atlantic Canadians' most vital industries down the road.
The latest figures show that 155,000 Atlantic Canadians are officially unemployed. We all know that the real numbers are much higher than that.
Why is this government once again turning its back on the unemployed in Atlantic Canada?


Donald Frank Mazankowski: Mr. Speaker, we are certainly doing nothing of the sort.
Earlier we heard in this House questions from the Liberal Party accusing us of not taking enough action on the deficit. Now in the same Question Period they are asking why are we cutting here and why are we cutting there.
In the area of regional development there has been a tremendous amount of growth since 1984-85 in the regional development envelope, $5.6 billion in the last five-year program. That is being reduced. It should also be recognized that what is being put in place is a new program of repayable contributions that will use revolving funds to fund the projects. That has been very successful and we are working toward achieving that goal.
In conclusion, I will remind the hon. member that while program expenditures are growing at a rate of 1.5 per cent per year, the transfers to the provinces will be growing at the rate of 4 per cent per year. We could have reduced transfers to the provinces. We chose not to do it

April 27, 1993
Oral Questions
because we recognize the difficult circumstances that many of the provinces are in.
I think that is a clear recognition of the regions and the provinces that what we have got in here is a process and a plan that is realistic and achievable.


Mr. Joe Fontana (London East):: Mr. Speaker, I suggest that the minister is playing a shell game with the provinces.
Yesterday this government announced that it will cancel funding for the majority of social housing programs in this country. This is a withdrawal from the cost-sharing housing programs that the federal government has participated in with the provinces for over five decades.
There are over one million Canadians in need of adequate and affordable housing who depend on this federal national government. There are over 200,000 Canadians homeless.
I want to ask the Minister of Finance why this government is unilaterally withdrawing its responsibility to provide funds for social housing. Does he not realize that good housing policy is good social policy and is good economic policy for this country?


Donald Frank Mazankowski: The hon. member indeed does make a point as did the other two members who asked questions on the Liberal side and as did members from the NDP, concerned about the cuts that I announced in the budget yesterday.
I would hope the business critics out there who saw this budget as a do-nothing budget, as a budget that did not cut enough, watch this performance here today. I hope the bankers watch the performance as well and I hope that the investment dealers watch the performance because the point is very well taken.
As the hon. member's colleague alluded to a little earlier, governing is about making tough choices. We have made the tough choices and we intend to implement them.


Mr. David Walker (Winnipeg North Centre):: Mr. Speaker, my supplementary question is for the same minister. I hope that every single Canadian is here and is listening to you refuse to withdraw the helicopters-


Some hon. members:: Hear, hear.


Mr. Speaker:: I know hon. members want to address each other through the Chair. I would also ask hon. members to keep in mind that the time is running out. Shorter questions, please, and shorter answers.


David Walker: Mr. Speaker, this government has made a choice and its choice is on helicopters. When we ask that other priorities come before this House, we ask this government to abandon the helicopters and stand up and do things for Canadians.
Right now in this project there is not one cent provided for the three million seniors in this country for housing. This government for the first time in 50 years has abandoned housing for senior Canadians.
I ask the minister why he has abandoned the seniors in this country.


Donald Frank Mazankowski: Mr. Speaker, what we are talking about in the acquisition of the helicopters is an expenditure of about $300 million a year for a 14 or 15-year period. I should advise the hon. member that a good portion of this is going to create jobs in his own city, the city of Winnipeg.
In addition to that, the defence envelope is taking a substantial cut. In this budget $5.9 billion is being cut. In total between 1989-90 and 1997-98 there will be a total of $14 billion cut out of the defence envelope.
If the hon. member is suggesting that we spend $2.5 billion to repair and fix up the old helicopters for a 10-year life, that would be money that would be poured down the drain and be wasted. We would still have old helicopters and we would have to purchase new ones in ten years' time.
That would be just sheer folly. This is a realistic and sensible course of action.


Hon. Lome Nystrom (Yorkton-Melville):: My question is also for the Minister of Finance, Mr. Speaker.
In December 1992 in the budget the minister broke an agreement and cut the Crow benefit to hard-pressed prairie farmers by some 10 per cent. Yesterday he suggested a further cutback of 10 per cent, which is another $72 million to prairie fanners, unless they agree to change the method of payment by which they receive that money. Farmers are saying to me that it is unfair.

Either you change the method of payment or lose another $72 million per year.
Will the minister admit today that this is nothing short of blackmail for the prairie farmers?


Donald Frank Mazankowski: No, I would disagree with the hon. member. I would say that this is a clear incentive to get on with the job. When you have a $720 million subsidy that distorts the marketplace, that results in the provinces having to spend money to overcome that distortion, that is not a wise use of public funds.
We are saying here, as I said in the preparation of this budget, that all Canadians are going to be affected by the measures undertaken here. We can obviously see that they are, that that is the case.
I appeal to the hon. member to work closely with the Minister of Agriculture who has started a reform process. Reform is required. We want to expedite it and facilitate it so that it can serve the long-term interests of the western Canadian farmers.


Mr. John R. Rodriguez (Nickel Belt):: Mr. Speaker, my supplemental question is to the Minister of Finance as well.
In December 1992 the minister cut regional development programs by 10 per cent. Yesterday the finance minister continued the cutbacks in regional development by a total of $1.4 billion over the next five years. By withdrawing from the ERDA programs Newfoundland would have to come up with over $60 million to continue with the program; Ontario would have to come up with $40 million, not including the cutbacks to FedNor, ACOA and Western Diversification.
My question to the minister is this: why would the minister cut back on these programs which are so vital to developing employment opportunities in areas like northern Ontario, the Atlantic and western Canada? Why would the minister cut off the lifeline to the unemployed?


Donald Frank Mazankowski: Mr. Speaker, the very simple reason that we are doing these very unpopular things is
Oral Questions
to bring the deficit into line. I say yes, we are cutting. Unfortunately we are cutting, but we have to cut. I hope the bankers, the business critics and the investment dealers are listening to this exchange because they will know where we stand and where the opposition stands.
We are committed to bringing the deficit into line. They want to go out and spend, spend, borrow, borrow, tax, tax, tax.


NATIONAL DEFENCE
Hon. Lloyd Axworthy (Winnipeg South Centre):: Mr. Speaker, I have a question for the Minister of National Defence.
As the minister is fully aware we now have Canadian troops involved in two very active, very precarious and very volatile theatres of action around the world. At the same time I have a copy of the minister's travel itinerary for next week where she will be attending photo ops in Toronto, a stomp and chomp dinner and dance, and other areas.
In all honesty this is a very exceptional, very difficult and very dangerous time. I want to ask the minister of defence how she really believes she can be fully responsible for our troops in the field at the same time she is pursuing her leadership ambitions.


Hon. Kim Campbell (Minister of National Defence and Minister of Veterans Affairs):: Mr. Speaker, I would like to advise the hon. member that owing to the miracles of modem technology I am able to be Minister of National Defence for 24 hours a day. I am constantly in contact with my office when I am not in Ottawa. Obviously when I am here I am able to respond directly in the House.
I find it fascinating that hon. member who last week was crying in the House about the absence of the Minister of National Defence can rise in the House today and only ask me a question about my agenda, about my schedule. I think that says a great deal about that hon. member.


Some hon. members:: Hear, hear.
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GOVERNMENT ORDERS

[Stage Direction]
April 27, 1993

[Stage Direction]
The House resumed consideration of the motion of Mr. Mazankowski that this House approves in general the budgetary policy of the government; and the amendment of Mr. Gray (Windsor West) (p. 18487).
Steven W. Langdon: Mr. Speaker, what we have in front of us is a budget, as I was saying this morning, which has done absolutely nothing to increase jobs in this country. It contains no initiatives to give us new direction for the unemployed.
I see the Minister of Finance being congratulated by his colleagues. It can only be for having succeeded in putting in 94 pages not a single solitary new thought and for wasting hundreds of thousands of trees in the process. I suspect the colleagues congratulating him must come from forestry regions of the country.
What is so tragic about this budget is not just what is not there but what could have been there. We could have had moves to start to make our tax system fair by closing some of the loopholes at the top, loopholes like those the Auditor General identified last year that let large corporations take over $1 billion out of Canada tax-free, which we the taxpayers of the country have to make up.
We could have had initiatives to take action to make the GST gradually disappear so as to help small business and to help consumers across Canada. We could have had moves to put into effect a minimum corporate tax so that we got away from the scandal of large scale corporations being completely free of corporate tax even when they have made profits in Canada.
We could have had those initiatives. We could have had initiatives to see to it that in this country as in 22 of the other OECD countries the fortunes of people who are wealthy when they die and pass them on to their children and their friends are taxed and make a contribution to making our society better.
We could have taken that money and used it to get people back to work. We could have had initiatives on child care, the establishment of a national child care program such as the Prime Minister has promised for so many years and has failed to provide. We could have had an infrastructure program to give us some real sense of building a base for our economy for the future, a national investment fund to help the small scale and medium sized businesses in Canada that so badly need venture capital. We could in short have had a national jobs plan to put 1.5 million Canadians back to work, to bring the unemployment rate down and to put Canadians in positions where they are contributing to our tax rates instead of taking from our budgets.
Let me conclude by moving the following amendment to the amendment that has been moved:
That the following words be added after the words "economic recovery":
"by way of a national child care program, an infrastructure
program, a national investment fund, and a national jobs plan".
If we took this direction we would put Canada back to work. We would give Canadians hope. We would give our country a future built not on smoke and mirrors, not on Alice in Wonderland projections, but on solid economic ideas to give us a real basis for jobs in all of this country.
That is the direction in which we have to move. I hope it is the direction in this next election that people in Canada choose to take.


The Acting Speaker (Mr. DeBlois):: In the meantime, to avoid wasting time, we will move to Questions and Comments. We will hear the hon. member for Kingston and the Islands, followed by the hon. member for Longueuil.


Peter Andrew Stewart Milliken: Mr. Speaker, I wonder if I could ask my friend a question about his speech on the budget.
In his speech on page 3 of the budget booklet the Minister of Finance made the following statement:
Less borrowing, lower taxes, more jobs and more choice: that is the direction in which people want to go. And that is the direction in which this government is going.
April 27, 1993

Does he agree that this statement is completely false having regard to the fact that the government is borrowing both here and abroad at record levels, that taxes have increased 30-some times since the government took office and in fact now as a percentage of GNP has reached over 39 per cent from a level of about 33.8 per cent when the government took office in 1984, that fewer jobs are available in Canada because our unemployment rate has gone up, not down, and that Canadians are getting less and less choice because of the cutbacks in government programs? Would he not agree that this statement made by the minister is completely false and misleading?


Steven W. Langdon: Mr. Speaker, certainly the statement set out in the speech, as is so much in the speech, is a wild exaggeration in terms of the government's achievements.
To suggest the government is achieving less borrowing when in fact its borrowing has increased is simply wrong. To suggest that it is establishing lowering taxes is wrong. This is the government that put the GST into effect.
These are the parents of the GST across the aisle. Every Conservative who marches out to seek votes in this election should carry with him and her a little sign saying "I am responsible for the GST," just to remind people that is where it comes from.
Turning to more jobs, there have been more jobs for Conservative patronage appointees. There have been more jobs in the Senate for friends of the Prime Minister. There have not been more jobs for Canadians.
They promised 550,000 jobs from free trade. What they have given us is a loss of over 400,000 jobs in manufacturing and an unemployment rate of 11 per cent as of the most recent month compared to an unemployment rate of around 7.5 per cent when the free trade deal came into effect.
Dealing with more choice, this government believes that if it gives things to the market we will automatically get more choice. What Canadians have discovered is that by giving things to the marketplace to rule they do not get more choice; they get less choice.
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I have just one small example. Let us lookback to 1988 when this government was re-elected and think of the airline industry at that stage. There were four national airlines. We had Wardair operating scheduled services across the country. We had PWA operating scheduled services throughout the country. We had Air Canada. We had Canadian Pacific.
This government said: "Let's deregulate. Let's add even more choice." For a little while we had all sorts of little regional carriers throw themselves up into the air. Very soon they crashed to the ground and were taken over by other companies. We now have just two airlines: Air Canada and Canadian, and both of them are sick. We are not getting more choice. We are getting less choice as a consequence of the ideology rather than the thinking this government follows.


Mr. Nic Leblanc (Longueuil):: Mr. Speaker, I want to make a few comments on the budget. The government says that it cuts or reduces expenditures-


The Acting Speaker (Mr. DeBlois):: I simply want to remind the hon. member that the period for questions and comments is not the time to make a speech on the budget but, rather, to ask a question to the previous speaker.


Nic Leblanc: Mr. Speaker, I am getting there. Just give me a moment to explain what I have to say.
I was trying to tell the hon. member for Essex-Windsor that the government claims to cut expenditures while in fact it increases them. Indeed, it will increase expenditures by close to $3.6 billion this year, and by $3.1 billion next year. In the following five years, in spite of claiming that it is reducing expenditures, the government will spend $12.5 billion more. In the meantime, the government thinks it will get extraordinary revenue, based on the anticipated growth, which is unrealistic.
I want to ask the hon. member for Essex-Windsor what he thinks of all this. For example, why did the government not think about overlapping and duplication in the fields of unemployment and manpower training? This duplication exists in every department. We know that between Quebec and Ottawa, this duplication costs something like $3 billion. This means that in Canada we

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The Budget
could save at least $10 billion if we eliminated this duplication between the provinces and the federal government. We could have saved $10 billion per year right there.
What does the hon. member for Essex-Windsor think of the fact that the government claims to cut while it increases expenditures every year in its own books, that is by more than $10 billion over the next five years? It is absolutely inaccurate and totally unrealistic to claim that economic growth in 1993-94 will reach 4.5 per cent. What does the hon. member for Essex-Windsor think of the fact that the government did not take appropriate measures, such as putting an end to the duplication of government operations?


Steven W. Langdon: Mr. Speaker, I agree with the hon. member. In spite of all its declarations, the government has decided to increase its expenditures. You can see it on page 19 of the English version and on page 21 of the French version. The hon. member is absolutely right.
My colleague also asked if we could not save money and reduce expenses through a transfer of responsibilities to provinces, for example in the field of manpower. Personally, I believe that we must have a national manpower policy. We must have such a policy to create a national economy in which each worker would be able to go from one work place to another and to work anywhere in Canada.


The Acting Speaker (Mr. DeBlois):: I am sorry but the time for questions or comments has now expired.

The subamendment tabled by the hon. member for Essex-Windsor is in compliance with the Rules and is therefore admissible.


Hon. Gilles Loiselle (President of the Treasury Board and Minister of State (Finance)):: Mr. Speaker, I think everyone will agree that my colleague, the Minister of Finance, tabled a responsible and decisive budget.
The fiscal plan set out in the budget builds on the action taken last December, by extending and deepening
the expenditure reductions. While recent fiscal pressures have resulted from revenue shortfalls, the solution is not to raise revenues. It is to learn to live within our means.
With this action, the deficit target for 1993-94 will be met and there will be no new borrowings by the end of the fiscal planning period. Achieving these fiscal objectives is key to sustained economic expansion and the job and income gains that will come with it.
My remarks will provide additional context and detail on the measures announced in the budget, particularly the reductions in the cost of government. This action will over time have a major effect on the operations of government and the management of the Public Service.
These measures, together with the reductions announced in the economic and fiscal statement tabled in this House last December, will yield expenditure savings of $7.5 billion in government operations over the next five years. This is a major contribution to the total debt reduction effort of $30 billion. These cuts build on this government's ongoing commitment and actions to reduce operating costs and increase effeciency in government.

As set out in the budget, operating budgets and reserves for contingencies and new initiatives were reduced by $300 million in 1993-94, rising to $1.2 billion by 1997-98. This means that for the last four years of the fiscal framework the operating reserve is being reduced by 50 per cent from an already tight level.
Last December non-defence operating budgets were reduced by $1 billion in 1993-94 and by $1.7 billion in 1994-95. Taking into account the budget measures announced yesterday, the typical manager will in effect face an operating budget reduction of 3 per cent in 1993-94 and 5 per cent in 1994-5, reaching 10 per cent by 1997-98.
The reduction in most grant and contribution programs to organizations and interest groups announced last December will be extended and deepened to 15 per cent in 1995-96 and to 20 per cent in future years. These reductions will be implemented in a prudent and reasonable manner reflecting government priorities.


April 27, 1993

We recognize that given the magnitude of the reduction a fundamental review of a number of existing programs will be required. Scarce resources will have to be devoted to funding the highest priority programs.

The Minister of Finance also announced a number of other reductions across government: regional funding, the green plan, granting councils, international assistance, defence, social housing, the CBC and VIA Rail. We are far from being alone in a financial crunch. Most countries are facing tough economic and fiscal situations and most are responding to the large revenue shortfalls by taking similar action to reduce expenditures.
Closer to home we have only to look at the recent provincial budgets and statements. These reinforce the harsh reality that restraint is not just the order of the day, but of years to come. In the earlier years, we used restraint in large part to cut the fat that had accumulated from years of steady growth in government expenditures. As time passed, departments and agencies have had to find more innovative ways to deliver programs and services. They have had no choice to undertake productivity-increasing investments, and to make better use of their shrinking resources.
The demand for services increases with population and so do workload. Departments and agencies are pressed even more vigorously to re-engineer their administrative overhead and to deliver services at lower costs. Resources are having to be redirected to the point of service for the client and away from overhead and administrative processes.
Departments have no choice but to seize every opportunity for efficiency gains from investments in training and development and in information technology. This by itself is not enough, however, as we no longer have the means to pay for all the current programs, even less to tolerate duplication of services and other inefficiencies.

These latest measures will necessitate taking a hard look at priorities and making some difficult choices indeed. As I said in my speech during the debate on the December economic and fiscal statement, it will simply not be possible to do more with less.
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In some instances activities will be reduced and points of service delivery closed. As an example, there are currently 64 Canada immigration centres. These points of service are being reduced to 51, of which 22 will be co-located in Canada employment centres. External Affairs is closing nine missions including three embassies. It will also mean getting out of some lines of business.
Reducing the funds available for government operations will have an effect on employment in the Public Service. Currently salaries account for roughly 55 per cent of operating budgets. Assuming this proportion is maintained in coming years, we can expect that the reduction in total employment resulting from this budget will be approximately 16,500 by 1995-98. Indeed, based on past experience, the number of people affected will be significantly higher once the impacts of changing program priorities, service delivery innovations, new information technology and organizational adjustment are taken into account and as the mix of skills and people within a department and across departments continues to change over time.
In the period from 1985 to 1990, while the net reduction in employment was 10,700 it is estimated that approximately twice this number of positions were eliminated while new positions in other program areas were created.
A substantial portion of the anticipated reduction in total employment of 16,500 can be handled through retirements and resignations. We must not forget that some 9,000 employees leave the Public Service each year. However it is not realistic to assume that we will be able to manage all personnel reductions through attrition.
Most of the government's administrative and program operations are being redesigned to increase efficiency and the resultant changes will inevitably produce an imbalance between the skills needed and the skills available in a particular location. This is not unique to this government. It is much the same in the private sector and in the other levels of government.
As a practical matter employment in the federal public sector actually increased in 1992 by about 1,000 to a little more than 235,000 people. This reflects a wide range of increases and decreases across departments and agen-

April 27, 1993
The Budget
cies. Five departments and agencies showed employment increases of 300 or more in 1992, specifically Employment and Immigration Canada, Revenue Canada Customs and Excise, Correctional Services Canada, Health and Welfare Canada and Agriculture Canada. Four departments showed a decline of 300 or more: National Defence, Revenue Canada Taxation, Transport Canada and Statistics Canada.
In areas where there were reductions the persons affected did not necessarily have the skills needed in departments that were growing or these employees were not able to take advantage of these new demands because of their location.
The numbers are only part of the story. I do want to emphasize that the underlying purpose of the action we are taking is to secure savings in government expenditure. It is not to reduce the work force.
In the world of the 1990s the government needs employment policies that promote a flexible and more adaptive federal work force. Existing policies, including the work force adjustment directive, must be reviewed. There are aspects of the directive that we can no longer afford in the present economic climate. There are others which severely restrict our ability to modify the shape and size of the work force.
Therefore the government will seek some basic changes to the directive to give managers added flexibility. We will continue to fulfil our responsibilities as a fair employer but we must do so in the context of the economic and fiscal realities of the 1990s. We will invite unions to work with us toward realistic arrangements during negotiations beginning this summer as part of the regular triennial review.
We believe that public servants understand the economic realities faced by the government. I do believe that they understand these realities. I am convinced that they and their unions will want to work with us in finding innovative solutions to the problems we are facing. We are currently consulting with departments on this and are not ready to set out our proposals. Clearly we will be seeking significant changes.

As I see it, adaptability and innovation in the Public Service is key to its long-term effectiveness. This means that the institution as a whole, its organizational units, its management and every one of its employees must be able to adapt quickly to change. We must also continually strive to find better ways to deliver government services more efficiently.
One approach is to use information technology in new ways to improve administrative and program delivery processes. Information technology allows us to provide services to clients at lower overall costs to the government and, in many cases, to the clients.
The government is aggressively pursuing electronic means for conducting many of its routine transactions. This strategy also hinges on the use of electronic data interchange or EDI and complementary technologies such as bar coding.
Over 20 EDI initiatives are now under way, including electronic documentation at ports of entry, collection of remittances for GST and source deductions, electronic filing of GST and personal income taxes, and many, many others.
I am proud the federal government is becoming a leader in implementing EDI in Canada. Indeed I am pleased to note that on June 30, Supply and Services Canada's new electronic initiative FASTRACK will begin directly linking suppliers electronically with federal departments and agencies. This use of EDI for the procurement of goods and services and, in future, for related payments will mean lower costs for the government and for its suppliers. It will also contribute to an EDI-capable business sector, enabling it to better compete in the global economy.
We are innovating in other ways. We have established 12 special operating agencies and four more are on the way: Indian Oil and Gas Canada; the Transport Canada Training Institute; Translation Services; and Surveys and Mapping. The last three were announced in this Budget. They are service oriented operations given added flexibility to apply the best management practices in order to improve service delivery. Many Canadians have seen the improved service provided by the Passport Office, an early special operating agency.
April 27, 1993

The Budget
Across Canada, 129 InfoCentres have opened in Canada Employment Centres to provide Canadians with basic information on government services to more conveniently. Twelve departments are working together to make services available to the public through common government, rather than departmental, access points.
Through these InfoCentres clients can receive basic information on more than 50 of the most commonly used government programs like pensions, training and unemployment insurance, and bidding on government cheques replaced. They have access to hot-line services to departments when they require answers to more complex questions. Facilities are also made available for clients to meet with departments on specific matters-income tax advice for example.
We are also changing how we provide services to the business client who is confronted by a bewildering array of federal, provincial, municipal and private sector services.
The Canada Business Service Centres (CBSCs) are one among several initiatives. There are currently three CBSCs in operation, in Edmonton, Winnipeg and Halifax, which provide the business community with quick and accurate referrals to government services, programs and information at a single point of service. They are serving as the pilot for a network of single-windows that will soon extend from coast to coast. Discussions have begun on three others and it is our intention to establish a CBSC in at least one major urban centre in each province.
In Edmonton, the CBSC is a shared walk-in centre operated through a partnership of 15 federal departments and agencies.

To conclude, I was pleased to see that the premier of Alberta announced last week in the legislative assembly that his government intended to reform the regulatory system. I congratulate him and offer my support to any of the other provinces that choose to launch their own regulatory reviews. They can count on the co-operation and support of my colleagues and myself. We are eager to share the experience we have gained in our own milieu and we will provide whatever assistance possible should the provinces decide to move forward in this area.

In conclusion, I recognize the contribution that public servants have made and will continue to make, as we grapple with these difficult issues at a time of sweeping changes in government operations. Public servants are not afraid of these changes.
Unlike our hon. friends opposite, they are not afraid. These are people who deal with the public. They-and I address this to Public Service employees at all levels of government-must forge a strong sense of common purpose that they are all serving one taxpaying public, and that their well-being is inextricably linked to that of this public. This goes for us politicians too.


Peter Andrew Stewart Milliken: Mr. Speaker, I would like to ask the minister a question about the information centres the government has established so that people can inquire about all the various services it provides.

In my constituency of Kingston and the Islands it has set up one of these places. Seniors have to walk to it because it will not take telephone calls there and it does not give out its telephone number. Seniors have to telephone Ottawa on a 1-800 number, which is busy whenever they call. People wait 30, 40, or 50 minutes, they dial and dial and cannot get through because this line is tied up all the time. When they do they get a different person every time they call and have to provide different information. There is no continuity and there is no co-ordination. People are very angry at the lack of service.
The minister tries to pretend this is all just rosy and that everything is improving. It is not. It is getting worse. In his budget yesterday the Minister of Finance talked about Canadians having more choice with this government. They are getting less choice. They are getting poorer service. They are getting rotten service from this government because of its constant closure and shift to these so-called more efficient systems. This is not more efficient. This is costing Canadian taxpayers a lot of money because they have to make all these telephone calls and repeat themselves time after time when they phone because the person they are dealing with is never the same.

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The Budget
It is a hopeless system. The minister must know it. Why does he not abandon this? It is fine to lump them all together. That may make sense, but then make the office accessible to the public and not on some distant bus route so that people who have difficulty getting out and about are forced into phoning Ottawa or Toronto in order to get information.
It is a ridiculous system. The minister must know it. For him to stand with a straight face and tell us that everything is just great stretches all belief. I can see why he switches languages. He would want to say it in another language so that some of us cannot follow the logic because there is no logic to it.
I would appreciate the minister clarifying this for us. [Translation]


Gilles Loiselle: Mr. Speaker, the hon. member for Kingston and the Islands also tried to throw me by switching from French to English, but I think I understood what he meant.
I want to tell him that the experience I have had with information centres is quite extraordinary. You may have heard of a successful initiative in Quebec called Commu-nication-Quebec, for which I was responsible. I dismantled a highly centralized service and established centres in the various regions so that citizens could have support in their dealings with the government. That is similar to what we have been trying to do with federal organizations. In every area, we noticed a proliferation of organizations, representatives, departments, bits of departments and a lack of means. We obviously do not have the means to provide complete services to residents from every region of this country. That is impossible. We need to ensure that the information is stored somewhere and that there is a centre where people can get support when they deal with the government.
Many such centres in Canada are very successful. We are working with Communication-Quebec and other provincial governments and I am sure these centres will get better. I am not saying there are no errors and no problems, but the alternative to these centres is nothing at all.


Mr. David D. Stupich (Nanaimo-Cowichan):: Mr. Speaker, I have two short questions.
The minister talked about reductions in staff. He did not mention reductions in service. Neither did he mention the increase in the use of outside contractors to do the work.
I wonder if the minister has had any studies done or has done any which he could share with us showing that the use of outside contractors has actually saved the government money for the same level of service.
I have another question. Among the departments he mentioned where staff reductions have been considerable was Revenue Canada. Year after year I have heard the Auditor General say that if the department had hired more auditors each one of them would bring in perhaps 10 times as much revenue as it would cost for that employee. I wonder if it is cost effective to reduce the staff in Revenue Canada as much as has been done.
The last Auditor General's report said that some $500 million to $600 million of revenue is being lost because corporations are moving their incomes out of this jurisdiction into others that are more favourable to them. With auditors Revenue Canada would we be able to capture some or all of that $500 million to $600 million?


Gilles Loiselle: We are not proceeding with staff reduction because we want to reduce staff per se. We are just looking for ways to make the delivery of service as efficient and as inexpensive as possible.
I am sure that the hon. member is aware that as of April 1 this year we changed our administrative system to operating budgets. Each department is given an over-all operating budget within which they can move their resources around to get the best mix to deliver services.
Sometimes I have the feeling that the hon. member or the people across the aisle believe that the purpose of the Public Service is to be a big employment agency. We are not here to hire people. We are here to deliver services with people. If we can find a way of doing it better at a lower cost then I do not see what on earth should prevent us from doing it.
I think civil servants understand this. I am convinced that the number of reductions over the coming years will be very light compared to the size of this government's operation, which is close to a quarter of a million employees. Compared to any organization in Canada of a small, medium or large size that has had to get rid of hundreds of thousands of people, we have been very
April 27, 1993

attentive to our work force and have been very protective and we intend to continue to do this.
However the purpose of government services is not to find jobs for people, it is to deliver service professionally, efficiently, with the best possible people and at the lowest possible cost.
If there is a way of doing it with fewer people why should we not do it if we can save money? Why should we spend money just for the pleasure of repeating these mistakes of the past?
As for contracting out, yes, we can contract out when we find that it is a more efficient way of doing things for short-term action or areas in which we do not want to be involved forever. It could be snow removal or things of that sort which occur at certain periods of the year. We cannot have permanent staff just waiting there for winter to arrive so we use the private sector. They compete against each other and in this way we can lower our costs. We recruit excellent, well trained managers. We train them when the need occurs and they are asked to provide the services. They are given a budget and they must account for it. They have to devise ways of trying to do as much and more if possible with as little money as we can give them.
Basically this is the philosophy. It is not a religious approach. It is just a practical approach that Canadians expect from us.


Marlene Catterall: I see that I have to be very brief.
This budget has repeated promises to reduce the debt and deficit the same way the government has done for nine years. We all know that this has not resulted in a reduction but in an increase in the debt and deficit.
I wonder if the President of the Treasury Board has paid any attention whatsoever to the report of the Conference Board of Canada that commented on the December 2 financial statement. It said that the over-all impact of the measures of the government will be contradictory and will lower the real GDP rate by roughly 0.1 per cent-that is in fact 10 per cent of the expected GDP increase-and by 2 per cent in 1993. It promises that the dampening effect on economic recovery would be even greater if the provinces followed the
The Budget
federal government's example of restraining public sector wages and employment. Does he realize the impact of the decisions of this budget on economic recovery?


Gilles Loiselle: I wish the hon. member would help me reconcile this with the statement of the House leader today in this House who blamed us for not cutting enough and reducing our expenditure enough.
This is the problem that I would like her to address. Who should I believe? Do I take into account her remarks or the remarks of the hon. Liberal House leader? He told us that we have been trying to tackle our expenditure and deficit and that we have not been successful. Each time we cut $1 million it was opposed.
We have been trying and we have been successful. We have brought the deficit down compared with the GDP, which is very important. It is half of what it was. It is not enough and we want to do more. We had a statement in December. There was some slippage. We are taking corrective action. We will continue to fight. It is very difficult to do but we are not going to abandon it.
Our commitment is to put this fiscal House in order. We do understand that we have to keep a balance. If we had taken more out of the economy at this stage-we have taken $3.8 billion from the coming year-it would have had a greater impact.
I think the Liberals should make up their minds which way they want it.


Diane Marleau: Mr. Speaker, it is always a pleasure to rise on behalf of my constituents in this House of Commons, especially on this occasion when I am given the opportunity to speak to what is not only a pre-election budget but also this government's last budget. I know that Canadians rejoice that they will not have to deal with this particular government much longer.
I wondered when I sat in this House yesterday, why we went through this exercise. There were so many balloons floated up before the budget came out. All of a sudden the budget came and there was really nothing in it. If one wanted to speak to the budget at all one could only deal with the impact of this particular statement or budget on this particular year because obviously there will be a new

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leader within 60 days. There will be an election and there will be a new government with very many different faces sitting in this House of Commons. All we can talk about is the first portion. The rest is all conjecture and whatever nice things they want to say.
Let us look at what happens in this budget for 1993-94. The government is saying that it is going to cut things to the tune of I believe $3.8 billion. Let me remind Canadians that in December's economic statement it was cutting by $2.8 billion. Therefore it has only found approximately $1 billion. Of that $1 billion one of the savings, so to speak, is going to be some $625 million in GST refund cheques. It is not really saving that money. It is just not going to give out refunds in January 1994. It is going to wait until the end of its fiscal year, which is March 31, 1994. One will get one's cheque on April 1. In that way on the government's books it can show a decrease in what it is paying out on GST rebates of more than $600 million for the years 1993 and 1994.
There is not really a lot in this budget for 1993-94 in terms of cutting. That leaves maybe another $250 million or $300 million that is going to be cut from a number of other areas such as advocacy groups. The list goes on. I am just wondering why.
Prior to the budget coming out I happened to read an article in The Ottawa Citizen of April 20, 1993 written by Mr. Don McGillivray: "Usually a budget represents the dollars and cents form of a government's agreed policy. This time it is being presented when the governing party does not know who its leader will be in 60 days or who that leader will choose as finance minister or what will be the economic policies of the new minister and future finance minister. In other words, a budget now is a lame duck document, an interim financial statement from an outgoing administration. Mazankowski, since he is in temporary possession of the taxpayers' cash, has the power to issue political pamphlets at public expense."
Is that really the only reason that we have this budget at this time? Is it so that this particular government, at taxpayers' expense, can go out and boast and brag about all of the things that will happen when it is not there any more? As a matter of fact, some of them will happen after a second election.
One realizes there is going to be an election this year. There has to be one. Other projections go as far as five and six years from now. There could be many elections between now and then. I find it very strange to hear those members boasting about how they will cut the deficit by $30 billion and how they will reduce the debt in four or five years.
It is all really a game. I do not believe that Canadians appreciate being used in that fashion. I wonder at the mentality that carries this on because it has built Canadians up to expect some massive cuts. Did it believe that when it did not have the massive cuts that all Canadians would celebrate and vote Conservative next time around? I do not think the government gives much credit for intelligence. It is high time it considers it. On the other hand we do not have to worry about it because it will be gone after the next time.
Before the minister brought in his budget he spoke proudly of the fact that Canadians will get what they want. He clearly stated yesterday that there will be no new taxes or tax increases. Obviously we cannot afford more increases. We have already been taxed to death. This is the government that raised taxes of all kinds at least 35 times in the last 9 years.
As the Liberal leader stated, the tired old Conservative government is obviously showing more concern for its re-election plan than for the welfare of the Canadian people. It is clear that this government is committed to a jobless recovery.
The phrase jobless recovery comes from the The Work of Nations that is a book written by Robert Reich while he was still at Harvard. By the way this Mr. Reich is the Secretary of Labour for President Clinton. Reich took the American context to apply this term.
However unfortunately for Canadians the Tories have transplanted the reality of a jobless recovery onto the Canadian scene. That means that yes, we do produce more goods. Some corporations may make larger profits but it all has to do with increased productivity and no new jobs. That is where the term jobless recovery comes into the picture.
Canadians want to work and they want recovery but they also want good paying jobs. Right now they are underemployed and unemployed by the hundreds of thousands. As a matter of fact we have a figure of unemployment but that does not bring into consideration
April 27, 1993

the large number of people who work at part time jobs and short term contract jobs. It is especially crucial for our younger generation made up of those young people who are now in their twenties and have graduated from university and who are out there looking for work. It is especially frustrating for them.
It leads me to believe that this government has almost decided to write off this generation. We cannot afford to do that with the brilliant minds of our young people and the skills that some of them do possess.
Unless Canada rebuilds the infrastructure that serves its industries and more importantly that provides and improves the skills of its workers, then economic recovery may generate few new jobs. There is absolutely nothing in this budget that will get the economy moving again and put Canadians back to work.
The government is telling Canadians: "Yes, we are coming out of the recession and therefore our economy will be recovering." However it fails to recognize that the economy is undergoing a fundamental restructuring. The government has no detailed economic plan to nurture innovation, training and infrastructure that are the building blocks of a strong and prosperous economy.
Not too long ago Statistics Canada announced that the recession was over. It along with the Conservative think-tanks based their optimism on a selective set of statistics: rising exports, falling interest rates, continuing low inflation and a decline in the rate of personal and business bankruptcies.
Facts and figures that do not fit this cheerful scenario are ignored. I am referring to the still surging tide of lay-offs, the growing number of poor and homeless, the lengthening line-ups at food banks and welfare offices. We are in a state of social distress.
Bankers and business executives say that what counts is the upturn in profits. Prosperity is measured in corporate balance sheets, not in job creation.
Governments have seen to it that in both the public and private sector job cuts and more job cuts are necessary for Canada to become competitive. They tell us monthly that it is part of an economic restructuring process.
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Restructuring is the current buzz word in business and government, but what does it really mean? The dictionary definition is "to replace one structure with another." I would like to know where the new economic structure is for Canada. Can we see the old economy being torn down while we look in vain for its substitute? If it exists even in the planning stages, it certainly is not discernible. Neither are the new jobs that the victims of restructuring so desperately need. We do not know where they are coming from.
One of the tragic downfalls or victims of these policies is of course our young people. Generation x is the contemporary way to describe the lost generation, the followers of the baby-boomers. Young people today and generations x, y and z to follow will find it difficult to get jobs of any kind.
This is this year; I am not talking about the future. Young people cannot find jobs now. Many of them graduated from university this year. Many graduated two years ago and are out there in the job market. Many of them are looking for summer work to pay for their studies. Where are they going to get this help? Certainly not from the Conservative government across the way.
I can speak on this because I have children in that age group. Their friends and all of the people I know in their age groups have a very difficult time getting jobs. They are smart, and like to work. They want to work and are well educated. It is a crime to see them not being able to use their skills.
I want to talk about the deficit. It is fine to speak of dealing with the deficit. Let us face it. This government has made it a religion to talk about deficit cutting and debt cutting.
In 1984 the Minister of Finance, the hon. member for Etobicoke Centre, said he had a plan. He warned that if this plan was not implemented net public debt would more than double from its level then rising to over $400 billion by the early 1990s. Imagine how terrible it would have been had we only been at $400 billion for the debt. We are at $450 billion. That is how well this government has looked after this religion of deficit and debt. After nine years they are higher than what was predicted.

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The Budget
In 1985 the then Minister of Finance again said that he was in control. He said it over and over. In fact he was so confident that he subtitled his May 23, 1985 budget speech "Securing Economic Renewal" and told Canadians how he was going to reduce the debt and deficit. This is what he said: "I am implementing a clear and realistic medium-term plan to control our debt. We have put in place a plan that will meet the need for sustained reduction of deficits over the medium term. We have acted to control and reduce deficits in a balanced and careful way that will not tip the economy off its course of growth."
The result was not good. It was a shrinking economy, massive unemployment and line-ups at food banks and the UIC offices. It was what the Conference Board called a made-in-Canada recession.
As recently as the Februaiy 1990 budget, the Tories told us that the $30.5 billion would be reduced to $14 billion by 1993. It is now 1993 and the deficit has been clocked at $34.4 billion. Of course now we have been told that it will be $35.5 billion. It continues to be far more than what they have said it would be.
Now the Minister of National Defence says she is going to eliminate the federal deficit within five years. The Minister of the Environment says he can do it in four. But they do not say how because they know it cannot be done without radical cuts to social programs and transfer payments.
Even then we do not know that economic growth would follow. Even the Minister of Finance knows it cannot be done as quickly as what they are saying. He said that if the whole government operation were shut down it would not balance the deficit. We would save $15 billion or $16 billion and the senior citizens and the veterans of this great country would not be receiving their cheques. This was in an interview on CBC Prime Time News in December 1992.
Maybe that is why none of the Tory candidates are talking specifics when it comes to investing in people or helping Canadian firms to get ready for NAFTA. They do not understand that any successful battle against the debt and deficit will require not only expenditure cuts but also a thoughtful plan for economic growth. Only then would we put Canadians back to work and generate the additional revenues to put Canada's fiscal house in order.
I said today in Question Period that governing is about choices. This government is the one in the driver's seat and it makes the choices. It has chosen to do nothing. It has chosen to ignore Canadians and their need for real hope. If hope is not given to Canadians, even those who have jobs fear they will lose them. They hold back and do not buy the things that perhaps they would if they had a little bit of hope and faith in the future.
We then fall into the vicious cycle of restraint and depression. Sales go down. There are bankruptcies and people get laid off. It continues on and on. It would have been a great gift to Canadians if after these terrible nine years of government it had at least tried once during that time to do something for the average Canadian.
The government should have tried to do something for those Canadians who are crying for hope and who want to work. Canadians are hard working and they like to have this independence. They want to share in the wealth of this country. It cannot be done when they are without work and without hope. Young people need a chance to build a life for themselves so that they also can pass on the benefits to their children in the future.
We know any government that takes over will have to deal with the deficit. There is no doubt that we all will. It is not whether we will or we will not deal with the deficit; it is how we will do it. We will do it by redefining government, by refocusing the powers of government to serve the people of Canada. We will not do it by spending more, but by reallocating government priorities.
Canadians know this and we know Canadians are worth while. The more they work, the better it is for this economy. The better it is for this economy, the better the regions of Canada will fare and the more able they will be to contribute to the wealth of this country. All that they ask is to be given half a chance.


Mr. Jean-Marc Robitaille (Parliamentary Secretary to Minister of State (Finance and Privatization)):: Mr. Speaker, I listened very carefully to my colleague who mentioned in her speech that Canadians were expecting massive cuts. From what the hon. member said at the beginning of her speech, you would believe that no major cuts were announced yesterday. Yet, during Question Period, her Liberal colleagues spent an hour accusing
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the Minister of Finance of having made monstrous cuts. They cannot constantly speak from both sides of their mouth. They have to make up their minds in the end: either there were cuts or there were not. Today the hon. member is saying that there were no major cuts and that we did nothing to reduce the deficit, but her own colleagues said the opposite for an hour during question period.
Mr. Speaker, the hon. member also mentioned that these policies hurt young people, but the fact of the matter is that they are actually victims of Liberal policies. It is the Liberal Party that let government finances get out of hand, which in turn compromised the future of young Canadians. That is what they are victims of. They are victims of this accumulated debt, while we are trying to be fair and equitable. It goes like this: "We want to have a good time. So what if we get into debt. Let the next generation pay." That is what the young could be victims of if we do not act immediately.
Let me remind you, Mr. Speaker, and the hon. member that every budget reduction measure taken by this government over the past nine years has been systematically opposed.


An hon. member:: This is a speech!


Jean-Marc Robitaille: It is not a speech, just comments I am making as part of this period for questions and comments. Wake up! Thke the time to come in, then you will know what to talk about.
A few days ago, we heard how the leader of the Liberal Party would solve the deficit problem. He would bring the deficit down to 3 per cent of gross domestic product. I would like to remind the House-and I am getting to my question-that in 1984, when this government came to power, the deficit as a proportion of GDP was 8.5 per cent, but it is now down to 5.5 per cent. I think this is not a solution in itself but rather an objective.
I am getting to my question. The hon. member is right, some of our predictions were off the mark. Bear in mind however that these previous budget forecasts were off the mark because revenues were down, not because expenditure controls were not fully adhered to.
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In this budget, and this is my question, policies to assist small and medium-sized businesses are pursued to create jobs, research and development assistance is maintained and there are no tax increases. Are the hon. member and her party prepared to support a budget that will continue to provide assistance to the small business sector for job creation, without increasing taxes?


Diane Marleau: Mr. Speaker, I have to respond to one of the statements made by the hon. member. He said that Canadians wanted to treat themselves. I can tell you that the Conservatives have been treating themselves and their friends for nine years. They loved those nine years. The prime minister is still treating himself today to a trip around the world. Why? Maybe he is looking for a job, I do not know but he tells Canadians to tighten their belts. It is okay for them but not for him. He has to go and play the big shot around the world because his mandate is coming to an end. Nobody can tell him what to do any more.
Small business owners cannot afford such a trip around the world.


Jean-Marc Robitaille: Answer the questions.


Diane Marleau: Small business owners have big problems with taxes imposed by this government. I know the Tories have not raised taxes this time, but have they not done enough to destroy those small businesses? Tell me, it is impossible-


Jean-Marc Robitaille: She is not answering the questions.


The Acting Speaker (Mr. DeBlois):: Order. I would ask the hon. member not to distract the Speaker who is listening carefully and I would ask the hon. member for Sudbury to conclude her remarks.


Diane Marleau: Mr. Speaker, the hon. member talked about small business. I can say that when I visit the small businesses in my riding they are dying under the load of increased taxation this government and the provincial government have imposed upon them by the layering of taxes. There is nothing they would love more than to see the delayering of these taxes so they do not have such an horrendous burden.

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The Budget


Jean-Marc Robitaille: Mr. Speaker, a point of order. I would point out to the Chair that the member did not answer my question.


The Acting Speaker (Mr. DeBlois):: I would say to the hon. member for Terrebonne that raising such a point of order is almost an abuse of the Standing Orders.
The hon. member for Rosemont.


Mr.   Benoit@: Mr. Speaker, every time a budget is presented, we are given this vision which is very tough, where we are told to tighten our belts because we must be more competitive, reduce the debt and the deficit and take measures for economic growth. On the other hand, the opposition presents the views of the unemployed and concern for social programs. However, everyone listening to us knows very well that the economy must be growing and jobs must be created in order to maintain our social programs.
The member for Terrebonne has just said that the government had met its spending objectives but not its revenue objectives. The question is why these revenue objectives have dropped.
We must strike a balance. It is wrong to say that we can be competitive and have economic growth without looking after social problems. In a modem economy, the two go together. Clearly, what is lacking in this country is a minimum of consensus on clear objectives.
We must remember that the Conservative government in 1984-perhaps few people remember-called a national conference of all economic partners. There was only one, it was a failure and another conference like it has never been held.
Nevertheless, countries which succeed-


The Acting Speaker (Mr. DeBlois):: Order, please. I may be distracted, but we are still in the period for questions and comments so I would ask the hon. member to conclude.


Mr. TVemblay (Rosemont):: Mr. Speaker, we are trying today to find a way to have both economic growth and full employment. As the Minister of Finance illustrates in his booklet with many international comparisons,
some countries are much more successful than Canada in achieving a total performance, that is, not only economic growth and competitiveness but also job creation and maintenance of social programs, but in all these countries, there is co-operation between the governments and those involved in the economy. This government's failure is its inability to co-operate with the other players.


The Acting Speaker (Mr. DeBlois):: Order, please. Time is up. In all fairness, I must recognize the hon. member for Sudbury, because we are still in the period for questions and comments.


Diane Marleau: Mr. Speaker, it is very kind of you to give me the last word. My message to the Bloc Quebe-cois is this: it is much better for us to work together as Canadians because unity is strength. I think that our problems are in part due to the fact that we are always quarrelling with one another. We spend so much energy, money and time on these issues that we do not concentrate all our efforts on the economy, where we should be working the hardest.


Mr. Gabriel Fontaine (Levis):: Mr. Speaker, before commenting on the new budget brought down by the Minister of Finance, I would like to say that I have agreed to share my speaking time with another member of the Conservative caucus.
Since 19841 have attended nine budget speeches, eight by Mr. Wilson and the last two by Mr. Mazankowski.
As soon as debate started on the budget, opposition parties would rise to say they were either unhappy about tax increases, because there were some tax increases initially, or about spending cuts. That is what they would say, and later on, when they had to vote on the budget, they always voted against spending cuts and tax increases of any kind.
There were also the reactions of Canadians to these speeches. Some groups felt they were penalized by specific measures in the budget which had a negative impact on them. Other groups said the government was not doing enough to cut spending, at a time when they felt spending cuts in departments should be accelerated. The government kept on gradually cutting back spending and has now stopped raising taxes.
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The results in the medium term, and I am not referring to the budget's impact in the media the day after the budget speech, have been such that editorial writers, economists, entrepreneurs, business people and consumers appreciated how our economy has developed and prospered in the process.
During the past 12 months, four major provincial governments brought down their budgets and made certain economic decisions. The most obvious example is the socialist government in Ontario, which now supports spending cuts and is against big tax increases. This is a first, but it is also the first time this party has been in power.
We also have a socialist government in British Columbia. The party's philosophy has been to spend money they do not have. Here again, the party finally realized it was time to live within one's means, and its budget contained more restrictions on spending and tax increases.
We saw the same phenomenon in Saskatchewan, where the country's third socialist government has cut spending and does not intend to introduce undue tax increases. Premier Bob Rae of Ontario told party supporters-the groups that elected him and Ontario's major unions-in order to justify the position he was about to take on major budget cutbacks: we have to be careful, and maybe it would be nice to get some guidelines from the International Monetary Fund. The Premier of Ontario is prepared to abandon the concept of running a government independently by saying they would welcome a statement by the International Monetary Fund that they should apply further restrictions to government spending in Ontario. That is an important point.
We in the Conservative government did not wait for instructions from international organizations. We adopted measures that prevented foreign lenders from calling the loans because we Canadians have a foreign debt of $275 billion to $300 billion. If we did not adopt restricted measures, interest rates would go up, the dollar would go down and inflation would increase. We would have the same problems we had in 1984, after the Liberals lost the election.
Today, our policy is to control spending constantly instead of making a sudden break with the past, which
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would have been disastrous for the economy. We have always preferred to reduce spending and control tax increases. What has been the impact of this policy so far? The best news is that in every Canadian family, in every household, every single taxpayer is paying interest rates of 5 to 6 or 6.5 per cent. Today people are not experiencing a reduction in the purchasing power of their dollar, as was the case when we had 12 to 14 per cent inflation in 1982. Today inflation is around 1.5 per cent.
The Canadian dollar enjoys respect throughout the world, and that is why every Thursday, when $8 billion changes hands, lenders still have confidence in the Canadian dollar and interest rates are gradually going down.
That is also the message we were given yesterday. We will continue along the same path. In conclusion I would like to quote the opening words of Mr. Mazankowski's speech yesterday: "No new taxes. No tax increases". That is what we heard yesterday. Zero real growth in federal spending on programs and services. We will not spend more than in previous years.
It is the lowest federal program spending as a share of the economy in more than 30 years. Despite sometimes outlandish criticism of our budget, that budget stays the course Conservative budgets have followed since 1984, and it will guarantee a further economic recovery and economic expansion during the next five years.
That is why I am proud to be a member of this government and to take part in this debate on the budget. I hope we will hear at least a few positive comments from the opposition, and I also hope that some opposition members will give the government credit for what it has done and vote in favour of a status quo for government spending and against tax increases for this year.


Benoît Tremblay: Mr. Speaker, could the hon. member for Levis explain to me how he can be so proud of the financial policy of his government when, on page 15 of the budget, the Minister of Finance tells us that, even in 1998, the Canadian economy will not have regained its full production potential?


Gabriel Fontaine: Mr. Speaker, I thank the opposition, member for his question. I will take this opportunity to explain to him that, since 1984, international circumstances have definitely changed. More and more, every country of the world is living in a global context. We

April 27, 1993
The Budget
cannot say that the situation was exactly the same in the previous decade.
We must take this global change into account. Also in the last few years, we went through a period where the Canadian economy experienced some depression caused, among other things, by external factors which led to some stagnation in our industrial process, the production process, and that definitely delayed some tax revenues.
That gave us additional challenges. We asked ourselves at one point if it was better to print money and reduce its value. We decided to go on the same road of restraint, and some are claiming that we are still going in the right direction, although the goal is a little farther away. This claim is shared by the Organization for Economic Co-operation and Development, which comprises 24 European countries, by the International Monetary Fund, and mainly by the holders of Canadian bonds, the foreigners who are holding the Canadians' debt totalling more or less $275 billion. Those people must continue to believe in our fiscal policies and as a result of the budget, they do.


Mr. Geoff Wilson (Swift Current-Maple Creek-As-siniboia):: Mr. Speaker, I welcome the opportunity to participate in this budget debate. I want to concentrate particularly on one portion of it, which I view as an olive branch being offered by the Minister of Finance to his provincial counterparts. That olive branch involves the transfer payments that are made by the federal government to the provinces in the form of cash and tax points.
These transfers come by way of three programs: equalization, the Established Programs Financing and the Canada Assistance Plan. The budget indicates the intention to continue these major transfers to the provinces to the point where they will grow by 4 per cent over the next five years. The provinces will receive about $9 billion more than they would if these transfers were restrained to the same rate of growth as all other federal program spending, about 1.5 per cent.
For a province like Newfoundland, for example, allowing this higher growth rate in transfers means over $400 million more. That is almost twice the size of Newfoundland's deficit this year and is equal to $700 for each resident of that province.
I think this is an important gesture by the Minister of Finance and I commend him for it. He is recognizing that there is only one taxpayer. Whether we are talking about the municipal governments and their funding requirements, provincial governments or the federal government, at the end of the day all of these governments have only one source of funds and that is you, Mr. Speaker, me and other Canadians: the taxpayers.
For the past eight and a half years the federal government here in Ottawa has waged a lonely war against the deficit and the debt. The national debt was something like $207 billion in March 1985 at the end of the last year of the Liberal administration that was characterized by chronic overspending on programs and the constant building up of debt. That Trudeau-Chretien administration left behind a situation which has been very difficult for government to cope with ever since.
I think that it has been made more difficult by the distinct lack of federal-provincial co-operation. Before I touch on that I want to point out that as early as November 1984 this government began to address the problems. The Minister of Finance at that time said in his economic statement: "This government is prepared to lead this process of economic renewal. We have set for ourselves four challenges." First and foremost among those was: "to put our own fiscal house in order so that we can limit and ultimately reverse the massive buildup in public debt and the damaging impact this has on confidence and growth."
He went on to say that because he believed deficit reduction is the key to rebuilding confidence and confidence is the key to growth and job creation: "Controlling the deficit must be our priority for this year and for each year of our mandate. The goals of deficit control and increasing job opportunities cannot be separated."
That was Hansard, November 8, 1984. That has been the policy and position of the federal government ever since. I am happy to say we have made steady, solid progress. However, it has not been without difficulty because while we expected every single revenue-increasing measure and every single spending cut and program
April 27, 1993

curtailment to be opposed by the opposition parties in this House, we also found there are difficulties at the provincial level. There is duplication of bureaucracy and overlap in a number of areas such as forestry, mining, tourism, recreation and others where both levels of government are trying to function.
We have seen a disastrous failure to harmonize sales taxes. A simple harmonization of the GST and the provincial sales taxes would assist in administration, reduce bureaucracy, improve border control possibilities and provide a much needed boost for the small business sector because it would relieve it of having to pay tax on production input costs.
We have seen the destruction of some very valuable federal-provincial programs unilaterally. I cite for example the gross revenue insurance program. The federal-provincial agricultural support program was unilaterally gutted last year by the province of Saskatchewan.
We have seen along the way the imposition of provincial payroll taxes. One cannot help but suspect in some cases that the target is the federal payroll, especially in a province like Ontario. We have seen situations where the federal government has attempted to provide some tax relief by reducing income tax. However, as soon as the space was left open it was more than filled by provincial government tax increases, so we have countless examples of frustration and counterproductive activity.
Just two years ago the provincial government of Ontario, the Bob Rae administration, announced to the world that it was going to spend its way out of recession. This was after six and a half years of the federal government doing everything in its power to bring the spending scenario under control and get the deficit in line. Because it was in a deep hole, the Rae government decided it was going to dig the hole deeper and somehow this would solve the problem. Of course that has been shown to be nonsense. It could not help but frustrate the general direction in which the federal government has been attempting to steer the country. That is why I am pleased with the signal the Minister of Finance has given.
I want to say a little bit about off-loading. So often provinces give federal off-loading as their excuse for
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some of their problems, suggesting the federal government has cut or reduced its levels of transfers to the provinces. That in fact is not so. I found a very interesting editorial in the Globe and Mail of Wednesday, March 24 1993, headed "The facts about off-loading." I would like to quote from it because it sets out very succinctly the new age of enlightenment. It begins by saying: "Now that provincial governments of every political stripe have more or less admitted that the federal government was right all along about the dangers of deficit spending and that they were wrong, we trust they will also confess their error in the ongoing dispute over federal transfer payments."
The editorial goes on to mention the three systems of federal-provincial transfers. It points out that since 1986 the federal government has progressively cut the rate of growth in those payments, eventually freezing them in per capita terms. Since 1984-85 federal transfers to the provinces have increased from $24.6 billion to about $40 billion this year, a 60 per cent increase or about 6 per cent per year. While it may not be enough for the provinces, it is certainly more than other parts of Ottawa's budget received.
It concludes by saying: "No doubt the provinces were disappointed that Ottawa did not increase its transfers quite as fast as they, the provinces, were raising taxes at home, but the only reason that has been a problem for them is that their spending went on rising as if it had. But Ottawa could hardly have been expected to match the provinces in whatever absurd flights of spending they chose to take. If the provinces now find they have flown too high, it is not the fault of Ottawa for clipping their wings."
We have the situation where the provinces that have had the sole responsibility for education and health for many years let the spending run wild, failed to control it and then tried to upload their problems to the federal government.
The Minister of Finance has made a very important overture in this budget by agreeing to continue the increase in these transfer payments to the provinces. It is a very big ticket item for the federal government which it could very easily cut to reach an earlier balancing of the books and elimination of the federal deficit.

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The Budget
As an overture, as an olive branch and as a signal to the provinces, the Minister of Finance has made that significant concession in his budget. Apparently we are going to have a meeting of federal-provincial ministers toward the end of May. We can hopefully look forward to some constructive activity leading to more federal-provincial co-operation in dealing with this very difficult insidious problem.


Benoît Tremblay: Mr. Speaker, I wonder if the member for Swift Current-Maple Creek-Assiniboia is serious when he says that this budget shows openness to the provinces. The member mentioned that the provinces receive payments for three programs, which are called established programs, namely funding for health and education, equalization and shared funding of social assistance. We are told that expenditures will rise 4 per cent in the next five years while government spending is limited to 1.5 per cent.
What programs are we talking about? We know very well that per capita spending on health and education is frozen. There is no 4 per cent increase there. We also know that there is a cap on equalization payments, so what will increase in the next few years? Basically welfare payments. Why? The reason is very simple: because unemployment will rise dramatically.
The federal government's spending on unemployment insurance rose from $12 billion to $19 billion in two years. That is certainly not a 1.5 per cent increase. Since few jobs are expected to be created, people who are on unemployment insurance today will be on welfare tomorrow. Since the federal government has to pay 50 per cent of that, federal transfers will increase 4 per cent on average, but spending on this will go up by 10, 12 and 15 per cent a year. The provinces will have to pay half, so their spending will go up 10, 12 and 15 per cent a year, while transfers for education and health will not increase at all because they are frozen. We know that in tough economic times, spending on education rises because people stay in school or university longer and spending on health also goes up. I would like the hon. member to explain to me how the federal government has made an overture to the provinces.


Geoff Wilson: Mr. Speaker, I welcome the hon. member's question. I remind him that at the end of the day there is only one taxpayer in this country. That holds true whether we are talking about programs and expenditures of the federal government here in Ottawa, the various provincial governments or the municipalities.
It is incumbent upon all levels of government to act responsibly because they are all facing exactly the same pressures. We have gone through a period beginning in the late 1960s where program spending began to exceed revenue. Unfortunately successive governments borrowed at that time instead of raising taxes to commence paying for those programs as a signal to the people of what the cost was. They put it on the credit card and unfortunately the time has now come where this vicious cycle of having to pay interest is compounded to the point where it is a very serious constraint on the abilities of all levels of government to be able to meet the expectations of Canadians.
It is abundantly clear that Canadians from one end of this country to the other are determined to see some progress being made to bring down this treadmill of debt. In fact all of our revenues do not have to be consumed by paying interest on past borrowings.
The hon. member makes reference to problems of unemployment. At this time, I believe employment in this country is approximately 200,000 below the all-time high.
I would remind him that we have been in a stubborn global recession. I remind him of the term global recession because all of the countries of the world have been caught up in this.
It is not a made-in-Canada recession the way the opposition would like to suggest. I can cite the state of California which has lost 700,000 jobs over the past few years as a result of global recession. It is certainly not a made-in-Canada thing.
The fact is that this recession has resulted in less revenue coming in than had been projected. That is unfortunate. What it has done is slowed down the time at which we reach the point where the annual deficit is eliminated. It has been put off for a few years.
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I think we would have been there by about 1994. It is going to be a little bit later. The good news is that thanks to the deficit control measures of the government, thanks to the lower inflation that follows and the lower interest rates and to the free trade agreement, we do see job creation.
There have been 200,000 additional jobs created in this country since last August. For nine consecutive months, employment has increased in the country. I think that is proof positive that over the long run these policies of prudence are going to pay off.


Mr. Sergio Marchi (York West):: Mr. Speaker, I am pleased to rise to speak to a budget presented by the Minister of Finance yesterday.
When Canadians await and anticipate a national budget from their national government, they expect quite legitimately that the government will produce a financial blueprint that will address not only their particular economic predicament but the economic reality facing our country.
It is very similar to when families sit down to do their household budgets with their needs and difficulties. They try to be realistic. Governments should be charged with the same responsibility.
From this very simple perspective this budget was an irresponsible cop-out. It was a cop-out because it ran from the challenges and difficulties that are facing the country and that it helped create in the first place.
As a result, it failed Canadians economically in a time of great economic need. Just when our country needed some confidence and hope to overcome these economic challenges we receive as an answer a lack-lustre, leaderless budget document.
There is much that can be said about this document, particularly what it failed to do. I will dwell on five essential areas.
First, this budget as described by government members themselves was a basically stay-the-course budget. I could understand if the course was well received by the country, if the economy was vibrant, if people were satisfied, if the nation felt buoyant and if we were in a time of economic vitality. Then I could understand staying the course and hopefully staying it for a number of years.
The course that this country has been on for the last number of years in my humble suggestion, and I think it
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is shared by a great number of Canadians across the country because of their own individual lots, has been a very painful course. It therefore speaks to new remedies, to a change of course and new ideas and new assumptions.
Things are not working for all too many Canadians. Is this document rooted in reality? Does this government know or care about the 1.5 million unemployed? Does it care about the three million on welfare? Does it care about the plant closings in my city of metropolitan Toronto? Does it care that confidence is down across the country?
Does the government care that poverty is up every single year since it was elected? Do those members know that in addition to a recession still very much on on the streets of Canada our country psychologically is going through a depression and a state of very much insecurity largely triggered as a result of broken economic dreams and aspirations? The line-ups at food banks are getting longer, not shorter. There were 75 million pounds of food delivered to Canadians through food banks last year.
Talk to businesses Mr. Speaker and they will tell you that the proverbial turning of the comer is a long distance away. This government says technically by definition the recession is over. Ask workers. Ask retailers. Ask restaurateurs. Ask manufacturers. Ask the various entities that make up our national economy. Ask them and then ask consumers if we are out of the recession.
This budget is going to stay the course. What does the budget do for that course? This government and everybody else says that small businesses and medium-sized firms are the engine of jobs and economic growth. There are three lines about small business in this budget: "We increased already our substantial support for small businesses, the prime source of new job creation in Canada, and they are now creating jobs."
It talks about having created 200,000 full-time jobs over the last number of months. I would like to see where those jobs are. My city of metropolitan Toronto alone over the course of the last couple of years has assumed half of the job losses, over 230,000 jobs, of the entire country. It wants credit for having created, unsubstantiated in this document, 200,000 jobs.

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Where is the plan, where is the commitment, to finding a new course, a better course, a course that will work for more Canadians and not fewer? Let us abandon the stay the course mentality rather than applaud it.
Point number two, the foundations of this budget are based not on fact and action but rather the foundations of this budget are built on future projections and predictions.
As far as predictions go, all their past predictions about job creation and deficit reduction have been off base. For instance we pointed out today during Question Period that their projections for the deficit for this year were only off $8 billion. They assumed a debt of $148 billion. We are now up to $450 billion.
The second thing about predictions is that they predict in two, three, and five-year cycles. A very courageous government, is it not? Not that it will have anything to say about that particular part of Canada's future because it is going to be on this side after the next election. What does that say to Canadians who live in the here and now, Canadians who are unemployed today, students who do not have jobs today? They are saying: "Who cares what you predict about jobs in 1998 when I do not have a job today when you promised me two years ago that x amount of jobs would be created."
Look what it says about job prediction. Page 14 of the budget: "Job prospects will improve. I expect," the minister says, "employment to increase by about 300,000 jobs this year," can you imagine, "and next year more than 400,000 jobs."
Nowhere does it say how or where these jobs will be created. Predictions, projections, not much comfort for people who live with that economic malaise today and who know that unless things improve, when they wake up tomorrow morning that same malaise will be facing them once again. They know what this government can do with its predictions and projections. In the first words of the budget, the minister said there would be no new taxes or tax increases, and all of them applauded.
Canadians are not stupid. Canadians do not need to be offended anymore. Canadians know that since 1984 when this government regrettably took office there have been 36 different and new tax increases, including the GST. Canadians know the disposable amount of cash in
their pockets at the end of the month when they add up the federal, provincial and property taxes at the local level. This government now wants applause because after 36 tax hits it says maybe you deserve a break today. Then it asks why people have lost confidence in their government and institutions.
On point number three, where is the budgetary recipe for economic growth in this country? How will we increase jobs which will increase consumer spending, increase available amounts of cash or disposable income, increase confidence, increase demand, increase production, which will in turn increase government revenues and therefore pay for the services and programs that we have come to admire?
We all have to be fiscally responsible. This government, despite playing smoke and mirrors with the debt and the deficit and cutting has opted perceptionally to cut, cut, cut. How do you address the need to expand the economy and help it become more vibrant? You just cannot do it by cutting and slashing in the extreme and on its own. You cannot expand by constantly contracting. You can cut until you are blue in the face and have no heart left but it will still not speak to trying to expand and grow our economy and to try to make it work once again, rather than contracting, cutting and slashing. You need a balance when you are looking at a national economy. You just cannot hide under one fancy title that we are cutting, slashing and are responsible and the economy will respond to that. You need a balanced approach. Like all things in life you need to have a tempered balanced approach and our economy is no different.
For instance, we know that there is a capital cash crunch for small businesses and medium-sized firms. All of us, including the members on the government side, have said that is where job creation really is at its best. What does it say about helping the capital crunch, the credit crunch for those firms? Again three lines on page 5 and I quote:
In response to representations on the equity capital needs of smaller, knowledge-based firms, we will also explore ways to develop mechanisms to encourage investors to support local companies-
Explore, develop mechanisms, encourage-pap, after nine years. What has it said in terms of that credit crunch about banks? Banks were pulling back credit and freezing loans. Companies that for anywhere from 15 to 30
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years had been good corporate clients of the major lending institutions could not get the time of day today.
Last Friday I had three calls in my constituency office. One was from a restaurateur, one from a food manufacturer and one from a small contractor. Each of them had been a client of the bank for over 15 years. Each of them had projects that would allow them to survive the drought. None of the three was able to get one dime from the chartered bank.
The story goes on and on. The banks have a role to play. I am not saying it is all their fault, not at all. I am saying that when looking at the equation of the national economy a very important variable is the role of the lending institutions. When there is a recession that role becomes doubly important.
Those banks should not be forcing small and mediumsized firms to pay for their lending mistakes to Campeau, O&Y or to South America. Those banks which exist because of entrepreneurship and risk taking should put their money where their mouths are. Take a risk with the small businessman. Allow him to refinance the truck. Take a risk and allow that restaurateur to expand and fill a new niche. Take a risk on that individual to buy a new piece of machinery that could perhaps do the job a little more effectively. Get behind some of those small and medium-sized firms.
We talked to the members of the Canadian Banking Association. When they visited our caucus I asked them of all the business loans portfolios to businesses what the percentage given to small and medium-sized firms was. After having told our caucus that is where the greatest number of jobs are created, less than 30 per cent of their business loans portfolio goes to small and medium-sized firms.
What does this government have to say about the role of our national lending institutions? That constituency is governed by federal statutes. As one important variable in that national economy they should be made to fulfil their role responsibly, not irresponsibly. If they fail to live up to legitimate lending practices that are needed for our times, well then it may be time for us as a Parliament and clearly as a government to revisit the
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statutes that give the banks the privileged place they enjoy in our country.
My fourth point is that the government keeps talking about the financial deficit. However, as a result of the dogmatic economic stay-the-course approach it has ignored the creation of a human deficit which manifests itself in different ways across our nation. There is a tremendous price to pay for those dogmatic stay-the-course economic policies when talking about a human deficit and sometimes we need to humanize the things we say or the policies that we create and pass.
How would you feel if you had to line up at a food bank for a piece of bread, Mr. Speaker? How would we feel if we had to go to an employment centre, only to see the same little cards indicating "thanks but no thanks" the day before? How would we feel if we were forced to live and exist off welfare? Think of the hurt and the stigma one would feel.
How would you feel if you were about to lose your job and what do you tell your family when you come home? How would you feel if you had to live below the poverty line? What hope would you derive the next day from this budget? What would you feel if you were part of the growing number of one-parent families led by single women, 60 per cent of whose jobs are below minimum wage? What confidence do you derive from this, if you are a senior and you are losing your house because you cannot afford to pay the property taxes after having sacrificed your entire life, or you are a young family and cannot afford to purchase that new house? How would you feel?
That is the human deficit members opposite prefer to ignore. Just like the chairman of the poverty subcommittee who pretends that the problems will go away if we raise the threshold of the poverty line. What insanity. What kind of blinkers are these men and women opposite wearing when they are oblivious to that human deficit? The tab keeps going up, not down. Let us look at that deficit while speaking rhetorically about the financial deficit.
This is my fifth and last point. Where is the inspiration that we are to be providing? When we talk about a budget we talk about inspiration and hope and not losing

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The Budget
confidence. Where is that inspiration in this document that says we are going around the comer and together we are going to do it? There is none. There is no inspiration.
The leadership candidates on the other side condone the budget. Where is the newness? Where is the freshness? This really is the last chapter in a very sad Conservative tale. On top of it all, the Prime Minister has the audacity to spend $1 million on his egomaniac farewell tour when every other Canadian is left to make their own plan to get out of their economic misery. What a tale to finish this.


Gregory Francis Thompson: Mr. Speaker, it was an entertaining speech to say the least, but I think it has to be laced with a little reality. None of us could help but listen because it was a very forceful speech.
When the hon. member talked about some of the difficulties he saw in Canada and those aspects of the economy that none of us want to see, I think he ignored a great deal. That is the point I want to make. He ignored a certain amount of reality out there. We are talking about unemployment and about 1.5 million people unemployed. None of us can take much satisfaction in that. None of us can.
I would like to focus on the fact that Canada's economy is moving along nicely. Now it is not growing as fast as we would like it to, but certainly it is not a stagnant economy. It is not stagnant at all.
What we have to do is compare where Canada is today in relation to the rest of the world and it is not doing too badly. In fact the statistics indicate that Canada is doing better than the rest of the industrial world.
In fact the IMF predicts that Canada's growth rates of 3.2 per cent in 1993 and 4.4 per cent in 1994 will lead the rest of the world. One might ask why. It goes back to one of the statements the hon. member made. I will give the answer and the member can respond.
What he was saying in his speech was: "Listen, we can see the Draconian things you are doing in terms of cutbacks and trying to control the deficit." I accept that, but he asks as to what we are doing to enhance the growth of the economy. The words he used were: "What is the recipe that you are proposing? Show us in terms of what the minister delivered yesterday. Show us the recipe in that speech."
The recipe is indeed there. Let me point it out: low interest rates, the lowest interest rates we have seen in 30 years; the lowest inflation we have seen in this country in 30 years; and investment opportunity, the likes of which we have not seen in 30 years. Therein lies the recipe.


Sergio Marchi: Mr. Speaker, the member says I am ignoring reality. The federal budget has two lines on jobs, zero lines on growth, two lines on small business and nothing about the banks. The hon. member talks about low interest rates, low inflation and great investment.
No one is investing in my province of Ontario. They are going to Dallas and Fort Worth, Texas and Phoenix, Arizona. Low interest rates and low inflation are academic issues because many people do not have jobs. The interest rates could be at 2 per cent but if you are not working, Mr. Speaker, you cannot invest. You cannot buy the cottage. You cannot buy the home, nor would you because you feel very insecure.
In terms of international comparison the hon. member takes great pride in saying: "Well we are going to lead the G-7 in terms of growth." He does not tell Canadians, nor does the Prime Minister, that of all the G-7 countries, we fell the furthest. Of all the G-7 countries our performance was the worst. Despite having dropped the furthest, our rebound according to economics is still not at the level it should be for the depths to which this government has brought this nation.
When the hon. member says that we are going to lead the G-7 countries out of the recession, why not also be honest and mention how deep the government brought this country down and that we were number one in terms of the worst economic performances.


Dennis Joseph Mills: Mr. Speaker, I want to compliment my colleague on an inspirational speech and especially the fact that he put so much focus on small business. We on this side of the House have been saying for the last two and a half years that the greatest hope for new job creation lies with the small business sector in this country. All the larger corporations are downsizing and dismantling. It is just an awful condition.
The thing that really disturbs me is the action the government took last December in its economic state-
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ment. In that economic statement it amended the Small Businesses Loans Act. When we came back in February we all worked together to put that act through the House of Commons in record time. We as Liberals stood up and complimented the government, but we did it with one condition, that the Government of Canada would promote the Small Businesses Loans Act in every region of this country and that it would also call in the financial institutions and get them to get into the act.
We can have all these posters at the banks reading: "Low interest loans at 5 per cent or 6 per cent," but if the banks are not going to lend money then what good is it? It is almost like false advertising.
My question to my colleague is a tough one and I have tried to figure this out. What are we going to do to get the banking institutions of this country to wake up and realize that the small business community is crying out for help? Small businesses are our greatest hope for putting people back to work and they are not coming to the party.


Sergio Marchi: Mr. Speaker, I appreciate the question from my colleague for Broadview-Greenwood. In his modest way he did not mention that for the last two and a half years he was very instrumental in trying to up the campaign of having all levels of government get behind our small and medium-sized firms and that great network of some 900,000 businesses across the country. If each of them were to create one or two jobs, imagine the type of stimulus we would derive.
I talked a bit about the banks. He talked about the small business loans. It really is a shell game unfortunately. When the government moved from the original $100,000 to $150,000 to the $250,000 small business development loans it would help underwrite, it was academic. Businesses in my riding told me that they could not even get to the first base of $100,000, never mind upping the threshold to $250,000. It was an attempt to try to suggest that somehow it was doing something great for the small business network.
What do we do with the banks? At the first opportunity, I think the first move should be one of co-operation. Have our chief financial lending institutions understand that their role in the national economy is a precious one, that during downturns it becomes doubly precious and
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that their variable is instrumental in the kind of output the economic equation gives us.
Second, if they are not prepared to have proper lending practices that reflect greater amounts of business loans to the small and medium-sized firms, which receive less than 30 per cent of all business loans from our banks, then we have to revisit the federal statutes that essentially give a monopoly for those chartered banks. I do not say that in a personal way and I do not say that in any nationalistic way. I only say it in order to add some muscle to the words we hear every single time we go back to our ridings.
The third area that I would mention is that of the chief inspector of the banks. I would like to put some teeth in that position to allow that inspector and the infrastructure around that office to actually take a look at those lending practices and see if they actually make sense with the times we are going through.
I would hope that we would first be able to sit down with the presidents of the major banks and lending institutions, which this government has not even begun to experiment with, and say that we are not putting the blame on them but the lenders must be engaged in a partnership in terms of stimulating and fomenting a more vibrant economy, taking risks and becoming the entrepreneurs they say that banks are founded on.


Hon. Lucien Bouchard (Lac-Saint-Jean):: Mr. Speaker, my first remark will be that this budget raises a simple question: why? I think that is the question that comes to the mind of many Canadians and Quebecers when they examine this budget, specially because this finance minister is probably more aware than any other Canadian of the seriousness of our fiscal problems in Canada.
If anybody is aware that strong action is urgently needed to regain control of our deficit and start paying off our debt, it is the present finance minister because the whole situation is known to him and he can get all the information, and because he is a member of a party and a government that was elected in 1984 on a platform that included putting our public finances in order. All Canadians remember that 1984 campaign when Conservative candidates travelled throughout Canada and Quebec telling everybody that the government should be

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The Budget
replaced and how terrible the Trudeau government was because it had accumulated a $200 billion debt.
I remember vividly the comparisons that were used and the terror they stirred up in the public. People said, and rightly so, that that cancer had to be removed. They thought it was unbelievable that, in 10 years, we had gone from a more or less balanced budget to a national debt totalling $200 billion. That was one of the factors that helped the Conservatives beat the Liberals nine years ago. The Conservative government, with much stricter requirements with regards to fiscal balance and with a much healthier notion of public finances-at least that is what people thought-was elected on a restraint and recovery program. So nobody knows more than the present Minister of Finance how important it is to deal with a public debt that has jumped from $200 billion to close to $460 billion in nine years. He knows it so much that, in recent months, he was told by the IMF that we had to be careful, that Canada's debt and deficit situation was becoming dangerous. He himself did everything he could so that Canadians would be ready to accept extremely drastic measures in the budget.
Everybody in Canada knew that they would have to make sacrifices after this budget. Everybody was ready for that because the present Minister of Finance managed to convince Canadians that things were going wrong and that the government had to intervene. Virtually no analyst was expecting a mild budget.
However, as the minister knows, the Canadian debt is the second highest in the G-7. We know how this government reminded us, during the constitutional and referendum debates, that Canada belongs to this select club of the seven richest countries in the world. The fact is that Canada is the poorest of the richest countries in the world, or at least the most heavily in debt, second only to Italy.
The Minister of Finance is well aware of the situation, since he reminded us of the fact in the fiscal statement he delivered December 2. There was one important thing he told Canada which the insiders knew but the general public ignored. On page 40 of the background document included with the fiscal statement delivered on December 2, there is a chart showing Canada's international indebtedness.
People, especially government members, talk a lot about the magnitude of our debt, but seldom if ever about the honesty the minister of Finance showed last December, when he told us about the international indebtedness level of Canada.
It is important to note that Italy, whose debt is worse than ours, finances only 5 per cent of its debt on foreign markets. Foreigners account for only 5 per cent of Italy's debt. Otherwise, Italians borrow from Italians.
If the Italian government needs to borrow in order to pay its debt, which is higher than ours, then it borrows from Italian citizens. In Canada, when we need to finance our debt, which is the second highest in the G-7, we borrow at 40 per cent from foreigners. At least, that was the situation back in December, according to the chart provided by the Department of Finance, so, you see, I am not inventing anything, Mr. Speaker.
In matters of Canadian sovereignty, when speaking of Canada managing its own affairs, one has to remember that 40 per cent of the financial decisions concerning the debt are taken overseas. That is to say that Canada is essentially at the whim of the financial market and if by chance foreign creditors are not satisfied with anything we do, Canada is at risk and is left with no room to manoeuvre when managing the public finances, the affairs of this country.
If anyone knows how dangerous this situation is and how important it is to maintain a confidence level overseas so that these 40 per cent foreign creditors continue to extend financing to us, it is the minister of Finance.
And what does the Minister of Finance do? The time has come to present his last budget, the last of a series of nine budgets by this government that has received all the snubs and has had many trials and tribulations in the constitutional and economic areas, when he has finally the opportunity to really do something to solve a real problem, that is the public finances problem.
What does the Minister of Finance do? He presents a do nothing budget. Those who have commented on the budget today across the country, editorial writers and columnists alike, have all said that this is not a budget, that there is no budget here, no real measures to straighten the public finances, nothing to deal with the disastrous situation in Canada.
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It is as if the Minister of Finance tried to avoid the necessary solutions. We all agree that it was not easy. We all recognize that there will not be a miracle and that the next Minister of Finance will have a lot to do to repair the mess he or she will inherit, that he or she will have to take continuous, aggressive and responsible actions to redress public finances. We all recognize that some decisions are difficult to take, but there are some which are less difficult to take.
For example, I cannot understand why this government did not decide to save money by eliminating waste and inefficiency that result from duplication of programs at the federal and provincial levels.
Recently, the members of the Quebec caucus of the Conservative Party presented to their colleague, the Minister of Finance, a paper in which they strongly recommended the transfer of the jurisdiction over manpower to the Quebec government. Everybody knows that if there is something that makes unanimity in Quebec, it is that transfer. People in the labour, business, cultural and political circles, the provincial Liberal Party and the Parti Quebecois, in short everybody in Quebec reached a consensus never seen before in asking that manpower training and development programs and policy-making be transferred to the Quebec government to make all the services accessible at a single window.
Instead of neutralizing each other's actions, instead of waging a war whose victims are the persons in need, those who lose their jobs or those whose jobs are at risk, let us create that single window everybody is asking for so we can meet the great challenges of our time.
All those people want single-window services in Quebec, including the Conservative caucus members from that province who, for once, did not hide to say this. They wrote it in a report published in the media. I think Senator Roch Bolduc and the hon. member for Joliette, Mr. Larrivee, are the leading figures who signed that report. The Tory members from Quebec also understood that this is an extraordinary way to stop wasting and to save, according to a Liberal minister from the Bourassa cabinet, some $250,000 a year right from the start. This is a lot of money in only one particular sector, and there are all the others.
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When he appeared before the Belanger-Campeau Commission, Pierre Fortin, a prominent economist, said that eliminating all duplication between Quebec and Ottawa could probably result in savings totalling up to $5 billion a year. There is one sector where duplication could have been eliminated very easily but it was not, even though everybody wanted that.
Mr. Speaker, whether you are federalist, sovereignist, Tory, Liberal or New Democrat, everybody in Quebec and in Canada knows that we will be the first generation who will pass on to the next one less than was ever passed on between generations in the history of Quebec and Canada. The building of a country is possible because a generation will pass on more than it has received. Slowly a real country is built and each generation passes on to the next one an invaluable heritage that it has enriched a little.
Our generation which perhaps received the most in history, in the whole string of transmissions, will be the first to pass on less than it received, to pass on a mortgaged country, a country that stifles the future of the rising generation, a polluted country, a country without a consensus. We are responsible.
We could have expected from this government that it would show courage, responsibility and some lucidity with respect to the present situation of those who are suffering and with respect to the future of those who justify our working, our struggling, that is our children and those who will come after them.
Moreover one would have thought that the Minister of Finance would spare himself this ridiculous exercise. He could have saved himself this touching exercise to help the two Tory Party leadership candidates save face because they ventured to make impossible and whimsical commitments when they said that if they took over from Mr. Mulroney as Prime Minister they would eliminate the deficit in five years. The Minister of Finance found it ridiculous. As one who for nine years has been part of a government that has been trying to reduce the deficit but only succeeded in increasing it to twice what it was before, he is the first to know that is impossible. He could not say it, but he could at least have kept quiet, but no, out of partisanship, out of electioneering solidarity, he wanted to help those two candidates that had ventured into the realm of ridicule and irresponsibility save face. He went through an exercise to prove that it could

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be reduced in five years. Indeed, he is saying that when he runs the country's finances, he can have a $32 billion deficit. However his successors will, through the workings of the Holy Spirit, or with the help of an extraordinary turn of events, reduce the deficit to $8 billion in five years, without tax hikes and cuts.
That is not the kind of Minister of Finance we are used to, especially since he indulged in unacceptable intellectual and accounting distortions. Does he not forecast in his budget that in certain years tax revenues will grow twice as fast as our economy, which does not make any sense? Any second-grade kid, who has learned basic arithmetic, knows on the face of it that it is a sham, but we must say that he tried that tack for his party's sake, so that the two poor candidates who said they would work miracles could save face.
After saying that I do not understand what happened, I could perhaps make an assumption, which in fact would explain the very existence of the Bloc Quebecois. First, how did the debt get so big? There are several reasons for it. Of course there are international and structural reasons, reasons related to problems with the economy throughout the world. We are not the only country in debt, but we are among the most indebted. To be sure, it is partly due to external factors and causes.
However a very large part is due to our inability to have a real consensus in this country. For a long time, the federal government threw money at problems in order to tighten its grip on the provinces and create a sort of fictitious Canadian unity. It paid to have duplicate institutions in the east and in the west. If someone somewhere clamoured, that person was paid off, and so it went. Rationality and efficiency were not the governing criteria most of the time or very often, but it was a way to buy peace.
Since Canada is tremendously rich in natural resources, we could go on paying for a long time, but when we no longer had the money required, we started to borrow. We borrowed so much that we can no longer do so now. We have reached the point where it is obvious that Canada cannot go on. This can be seen in the impossibility of finding a solution to the problem of the deficit.
There is a reason behind the Minister of Finance's inability to propose something that would straighten out the country's finances-it can be done, as we well know-in a fiscally responsible and socially just manner, by calling on everyone to accept some sacrifice, it can be done. The Americans will do it with President Clinton. It can be done in a country with a close sense of nationhood. Not here; it is not possible here to convince the east and the west to accept the same sacrifices. This is a country where an aircraft maintenance contract is enough to tear the country apart. A contract for helicopters or frigates is enough to tear the country apart. This is a country with no consensus.
The Canadian political structure does not correspond to reality. Our big problems like the budget and government finance require a fundamental solution. The problem is structural and the solution must be structural too. That is why we believe that since there are two realities in this country, two political, economic and social realities, there must be two political entities.


Charles A. Langlois: Mr. Speaker, while I was listening to the comments of my hon. friend from Lac-Saint-Jean concerning the budget some questions came to my mind.
First, the member for Lac-Saint-Jean, who was once a cabinet member in this government, must surely recall that, when the Conservative Party came to power in 1984-85, the debt was already very close to $200 billion and that this debt had mushroomed over a very short period of three or four years.
My hon. friend will also recall that the government's current account deficit was $16 billion. Let me briefly explain what we mean by the government's current account. It is simply the account into which go all revenues collected by the government through taxes- the income tax, excise taxes and other revenues-minus its operating expenditures. This current account was in the red to the tune of $16 billion, which means that the Governement of Canada was actually borrowing to pay for groceries.
In 1987-88 the member for Lac-Saint-Jean was a cabinet member. After the 1988 election, he realized that instead of a current account deficit, there was now a surplus. I think the member for Lac-Saint-Jean, as a
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minister of the Crown, had also experienced cuts in his department's operating expenditures.
I remember perfectly when the member for Lac-Saint-Jean presented the green plan with a lot of money to spend. I remember how impatient he became several times when he could not get these sums of money, because this government and this finance minister remained responsible. He could not get all the money he wanted in spite of all the good things that were said about the green plan.
The member for Lac-Saint-Jean will probably recognize, as I do, that this government has tried consistently to put the public finances in order. The member for Lac-Saint-Jean is criticizing the Budget. Would he have agreed, and it is the first part of my question, if yesterday the finance minister had announced massive cuts to transfer payments to the provinces? Would he have agreed if the government had announced massive cuts to transfer payments to those who need them the most, that is the elderly, the handicapped, the veterans? Would he have agreed with that? I think that having been part of the government, he is in a position to realize that there are things that cannot be changed without jeopardizing the very economic structure of the country.
I will ask him a second question to give him the opportunity to answer. The member for Lac-Saint-Jean has recognized, or at least, stressed the fact that training programs should be transferred to the Quebec government. I think that a consensus is emerging on that. Could he tell us why last October he campaigned against the Charlottetown Accord according to which manpower training programs would have been entirely transferred to the Quebec government?


Lucien Bouchard: Mr. Speaker, I wish to thank the hon. member for Manicouagan for these two questions. In response to his first question, I will have the opportunity to clarify once and for all the gossip peddled by government members, in particular the President of the Treasury Board when he goes to Chicoutimi and claims that the reason I broke ranks was that I was not given the money I had requested for the
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environment. I have written a rebuttal, but the minister never replied to that letter that I have had published.
As a matter of fact, I did get the money I had asked for. I wanted $5 billion to finance the green plan over a six-year period, and I got it. If the funding was later cut to $3 billion, I am not responsible for that. When I was minister, the funding for the green plan was $5 billion. It would have remained at $5 billion if I had stayed in office, because I fought for the environment. I believed that this government should do something positive for the environment, that it should make sure that we leave a clean, unpolluted country for future generations. Do not come and tell us today that we did not look after the environment. I insisted that we do so when I was in office, and we did.
Second, I want to deal with the hon. member's second question. It is obvious that, beyond the partisan sparring-and the quality of the debate has just gone down a notch but let us get back to the actual question being debated-the lack of consensus has been evident, especially since 1990 when the Bank of Canada had to use monetary policy as a club to impose interest rates that were obviously destructive for the economy of Quebec especially, and for the rest of Canada, except Ontario. Because the economy in Toronto was overheated as we must admit, the whole country had to take the drastic remedy of extremely high interest rates which had a direct impact on the interest the government itself owed its creditors. That literally killed business investment across Canada so that much of today's debt is actually due to the Bank of Canada's high interest rate policy, because this country cannot reach a consensus.
Just think that even today, the real interest rate in Canada is still double the real interest rate in the United States. That is not right. We are living next to the largest economy in the world, and we are separated from it only by a border, an imaginary line. Our economies are interrelated, integrated, as we well know; we are united by a free trade agreement. Why is it then that we need a real interest rate-that is, the mathematical interest rate minus the rate of inflation-twice as high as the American rate in order to protect the Canadian dollar? It is because this country has a political problem. Not an economic problem, a political one. The hon. member for Manicouagan is well aware of that. After all, he is from an area where the voters were overwhelmingly against the Charlottetown Accord he just referred to.

April 27, 1993
The Budget


Mr. Andre Harvey (Parliamentary Secretary to Prime Minister):: Mr. Speaker, my colleague from Lac-Saint-Jean takes great pleasure in defending jurisdictions. In this budget, if there is a sector where we could make drastic cuts, it is in the field of transfers to provinces. These transfers affect education, health, social services, et cetera.
I want to ask a question of the hon. member. Does he not think that it is preferable, as the Minister of Finance said in his speech, to first consult with provinces to arrive at a rational plan for reducing transfers to those provinces? The increases will be 4 per cent. Agreements have been signed and I think they must be complied with. Since the debt and the deficit are a national problem, it is important that all provincial governments reach an agreement with the federal regarding a reduction of expenditures in the field of transfers. This seems perfectly logical, while at the same time respectful of the provincial jurisdictions.
I will conclude by asking a second question to my colleague from Lac-Saint-Jean. We usually make judgments based on results. Since my colleague was the Canadian ambassador to Paris for three years, perhaps he could tell me which budget restrictions he implemented at the Canadian embassy in Paris, where several dozen employees work. I would also like to know if, in all conscience, he applied those budget restrictions objectively.


Lucien Bouchard: Mr. Speaker, my natural modesty has always prevented me from reporting on my tight management of the embassy in Paris, but he will let me do so since he is forcing me to do it today.
I was the only ambassador in Europe at the time who suggested cutting the staff in his embassy to the Department of External Affairs. I voluntarily proposed a reduction plan before I was asked. If I am not mistaken, because it was some time ago, I believe that we cut about 20 positions in Paris. I thought that we were overstaffed and I cut about 20.
If people tell me that I did not run a tight ship in the embassy, I was the most highly rated ambassador in Europe at the time for my management, if, Mr. Speaker, you will allow me to boast, since the hon. member mentioned it.
Secondly, regarding transfers to the provinces, is the member for Chicoutimi saying that he would like the federal government, which picked up these tax points during and after the war and must now distribute them back to the provinces, not to do so anymore but to keep this money and continue to impose requirements on the management of social programs in Quebec by saying "If you charge user fees we will stop paying"? Is he telling us that he would like the federal government to withdraw completely from transfers to the provinces for education and social programs?
If so, what does a federal government do? It proves what we are saying: the federal government must be abolished, at least as far as Quebec is concerned. Quebec must become a sovereign country that will look after its own social affairs, education and the rest, without sending over $20 billion in tax payments to Ottawa.
The member for Chicoutimi is just saying what almost all his constituents want: a sovereign government in Quebec City.


Gregory Francis Thompson: Mr. Speaker, it is a pleasure to take part in the budget debate. I think I will pick up where I left off when I questioned one of the members opposite with regard to their speech.


The Acting Speaker (Mr. DeBlois):: Will the hon. member indicate whether he will speak for 20 minutes or will split his time with another colleague?


Gregory Francis Thompson: Mr. Speaker, I am going for the full 20 minutes and I guess that will give me some time for tomorrow's session as well.
Picking up where we left off in debate with the member opposite there is no question today about the direction from which the opposition is coming. Those members are attacking again where they left off and have left off consistently in terms of debate and their structure of the debate when it comes to the finances of the Government of Canada.
I was taken today by the remarks in the House by the Minister of Finance when he talked about the same line coming out of the lips of the members opposite. Basically when it is all sorted out they are not committed to deficit reduction at all. I think if their words are carefully measured over there on that side of the House then the
April 27, 1993

Minister of Finance is absolutely correct. They like to talk about deficit reduction but when push comes to shove they really just want to pay lip service to it. That has surfaced in their remarks continually today. As the minister stated today their words really do not go beyond this. It is spend, spend, spend, borrow, borrow, borrow and tax, tax, tax. That has been a very consistent theme today.
They have been making some headway in this debate. I want to clarify this and step through what we have done. When they go beyond deficit and get off the deficit number then their argument simply is based on, for example, what one is doing to encourage investment in the economy. That is fair game and I think that is fair debate. I want to step through what we are doing because it is important to put it on the record.
What we are doing is pretty evident and it was evident in last year's economic statement which the minister brought down in December. That economic statement spoke pretty clearly in terms of what we are doing. Basically it comes down to this. The basic points of the argument are, and we have to mention this because it is very important the government do so, low interest rates, the lowest interest rates we have seen in this country for 20 years, almost 30 years, and low inflation rates, the lowest inflation rates we have seen in this country for 30 years. They are just part of the basics we have, but we also should fix firmly on crunching that deficit number.
That is where we have the basics right. That is where it is showing up in terms of investment in the Canadian economy. That is what we are doing. We are encouraging investment. We are encouraging growth in the economy.
I want to put on the record some remarks by the International Monetary Fund. The IMF sees Canada on a growth path. The evidence speaks pretty clearly for the Government of Canada in that regard. The IMF projects growth rates of 3.2 per cent for Canada in 1993 and 4.4 per cent in 1994.
What are those numbers really saying? They are saying that Canada is doing very well, thank you very much, in the face of the rest of the world. In other words, when we compare our economy to that of the United States or any economy in the western world, even countries like Japan,
The Budget
we are doing very well. The growth in the Canadian economy will exceed every one of the western European economies this year. As for the far east, we will exceed the growth of the Japanese economy as well. We have consistently done that as a nation since 1984. From 1984 to the present only one country in the hemisphere has exceeded Canada in terms of economic growth. Which is it? It is Japan.
We are doing fairly well, but not as good as I would like because 1.5 million unemployed people are too many for an industrialized country like Canada. We acknowledge that. We have to acknowledge it in the face of reality. We have to acknowledge what other countries are doing in comparison to us. They were caught in a world-wide recession as was Canada.
The members opposite say: yes, but the recession in Canada was worse. I agree it was worse. It was worse because our trading partners were going through that hurt as well. As a result of the fact that Canada is a trading nation we depend on the health of those other nations that buy products from us. Evidence of that, in terms of what we produce and sell to the rest of the world, is very compelling.
Last year Canada exported $157 billion worth of goods to the rest of the world. It was a remarkable turnaround for Canada. As the economies of the United States and western Europe started to speed up they were paying net dividends into Canada's economy. It takes a while for that to work through the economy. If they are buying $157 billion worth of goods from us today it does not mean that all the factories are up and running tomorrow because it does take time to work through the system. However, believe me it is happening.
Some of the numbers indicate that it is happening. Those numbers that have been put out by the International Monetary Fund are pretty clear evidence that it is working. Our economic policies are starting to work. Why? They are starting to work because our companies will invest in economies where there is security. They will invest where there is security.
When they look at Canada they will say: "Listen, your interest rates are the lowest they have been in 20 years. I like that. I think I will invest in Canada. Inflation is the

April 27, 1993
The Budget
lowest it has been in 20 or 30 years. I like that. I am going to invest." They have and it is paying dividends for us.
That is the recipe and that is the course we set out in 1984. We have applied that formula consistently in every one of these budgets from 1984 to the present day.


Mr. Keyes:: It is scary.


Gregory Francis Thompson: The hon. member opposite says: "It is scary." The only thing scary in the House is the thought of that party coming over here and governing us again.
Now that he has mentioned the word scary, I have some numbers here which are pretty scary. We always talk about the combined debt in this country and where it came from, how we arrived at this huge mountain of debt.


Stan Kazmierczak Keyes: Here we go, the 10-year old story.


Gregory Francis Thompson: It is a 10-year old story and I think it has to be put on the record very clearly. I have done it on a number of occasions and I will continue to do it.
I want to mention some of the difficulties we inherited as a government. I am not going to prolong the agony. Between 1968 and 1984, and incidentally those where the years when Pierre Trudeau was the Prime Minister of Canada, he took the country from a zero deficit position to a deficit of $32 billion. When we are talking about the deficit, just to remind the folks back home, the deficit is a yearly number. That is the amount by which the Government of Canada overspends on a yearly basis. He took it from a zero position-in other words in 1967-68 it was a balanced budget-up to the point where they were borrowing $32 billion a year to pay their bills.
What is really astonishing about that is that when they left office in 1984 the gross domestic product of Canada was just slightly over $400 billion. Today it is around $700 billion. That is just an example of running up a deficit of $32 billion in 1984, and there were revenues of only $71 billion.
By way of passing, our revenues this year will be somewhere around $122 billion to $125 billion, and the economy is around $700 billion. Remarkably we have kept our deficit down to that $35 billion number.


Mr. Thorkelson:: What about the debt?


Gregory Francis Thompson: The combined debt. When any government inherits a yearly deficit of $32 billion and the government of the day in 1984 was spending $1.33 on programs for every dollar it took in the door, it is in a very difficult position with regard to cash flow.
Today we have-and I know they take a great deal of pleasure in this-a combined debt of over $400 billion in which none of us can take any pleasure because it has doubled.


Stan Kazmierczak Keyes: $450 billion.


Gregory Francis Thompson: The hon. member opposite says: "$450 billion." It is not quite $450 billion. The exact number as we speak is around $416 billion. Again, it is not a number any of us can take pride in.
From 1984 to the present day the combined debt of the country has doubled. What they do not like to talk about is the stranglehold they had on the government, that is the previous government when it left office. They put us in a cash crunch situation.
The hon. member opposite chuckles. The point I would like to make is that between 1968 and 1984 the debt did not double under their government. The debt increased 10 times; it increased tenfold. We are guilty of doubling it and we accept that. However, it is the compound interest on the debt we inherited. We have not put one single nickel on to that debt load. It is all combined interest. It is the killing effect of compound interest on a debt that we inherited.
Let us go beyond that because it is an old story. Nobody wants to talk about it anymore, especially the opposition. How do we get beyond that? The minister told us yesterday to get beyond that by encouraging investment and not stifling it. We cannot stifle investment because if we do we are going to kill the economy. We must have a balance.
We on this side of the House acknowledge that we cannot do it. In other words we cannot pay off the debt simply by taxing Canadians more because there is not a single Canadian out there who is going to buy into that idea. I am one of them.
If we cannot tax the folks any more, and I think most of us would argue that we cannot, what do we do? We can
April 27, 1993

do a number of things. We can encourage investment, which we are doing. We can encourage growth in the economy which is happening and that is good.
We can also reduce the cost of government and size of government. That is something we have done consistently since taking office in 1984. We have reduced the cost of government, the size of government. On every single measure in every budget that we brought into this House to do that, the opposition consistently voted against it.
What it comes down to is talking out of both sides of your mouth on any particular issue because when you are elected, you do. Your feet in a sense I suppose are held to the fire because that is the price of governing.
The price of governing is making those tough decisions. They do not make you particularly popular with the folks back home or in the polls but at the end of the day the government of the day has to make the tough decisions and we have made those, made them consistently and they are starting to pay off.
Before I sit down I want to talk about the budget and who it has impacted on in terms of the cost of doing business or the reduction in the size of government and government spending. Who has it impacted on?
I am very proud to say we did not touch any of the social programs in yesterday's announcement. The minister as he stepped through the budget papers indicated that there are going to be total savings in this package of approximately $30 billion in the next four years.
We did not touch seniors or their pensions. We did not touch any of the support payments for veterans. We did not touch any of those programs which are important to a province like my home province of New Brunswick. We did not touch transfers to the provinces. In fact the growth of the transfers, the federal dollars to the provinces is going to grow, particularly for the poorer provinces like my home province of New Brunswick.
Why is that important to me? The province of New Brunswick depends on 40 per cent of its revenues from the Government of Canada. This year that will amount to about $1.5 billion. Obviously a small province like New Brunswick cannot afford to lose $1.5 billion. The good news is that it will not. That is extremely good news for the provinces back east.
Government Orders
To sum up, Canadians want to see an end to the deficit and they want to see it achieved through spending cuts and growth in the economy. They do not want to see it through higher taxes.
When those folks get up across the way and pretend to be in favour of tightening up government, reducing the cost and the size of the government, listen very carefully to what they are saying. At the end of the day I am reminded by the words of the finance minister today in the House during Question Period. If we sort out everything they say it basically comes down to the same three words: spend, borrow and tax.
The Canadian people have had it with taxes. They have had it with borrowing and they have had it with spending.


Stan Kazmierczak Keyes: And with the Tories.


Gregory Francis Thompson: I will just comment on the comments coming from across the hall.


BUDGET IMPLEMENTATION (GOVERNMENT ORGANIZATIONS) ACT, 1992 MEASURE TO ENACT
[Stage Direction]
The House resumed from Friday, April 23, 1993, consideration of the motion of Mr. Mazankowski that Bill C-93, an act to implement certain government organization provisions of the budget tabled in the House of Commons on February 25, 1992, be read the third time and passed; and the amendment of Mr. de Jong (p. 18396).
The Acting Speaker (Mr. DeBlois):: Pursuant to order adopted Thursday, April 22, 1993, the House will now proceed to the taking of the deferred division on the motion for third reading of Bill C-93, an Act to implement certain government organization provisions of the budget tabled in the House of Commons on February 25, 1992.
The first question is on the amendment.


[Stage Direction]
Call in the members.

[Stage Direction]
nil/aucun
[DOT]	(1825)
The Acting Speaker (Mr. DeBlois):: I declare the amendment lost.


Mr. Dingwall:: Mr. Speaker, I rise on a point of order. I think there has been some discussion among members of the House with regard to subsequent voting.
There may be a disposition in the House to apply the vote which has just been taken in reverse to the motion for third reading of Bill C-93, to apply the vote on the amendment of my colleague in the New Democratic Party to the report stage amendments to Bill C-109, and then to apply that in reverse to a motion to concur at report stage of Bill C-109.
[DOT]	(1830)


Deborah C. Grey: Mr. Speaker, ironically there have not been discussions, at least with me. I would like to put on the record that if there is agreement in the House to let this go through I would like it known that I will be voting yea on Bill C-93, the main bill. Then on Bill C-109 I will be
April 27, 1993

voting yea for all the amendments and yea for the main motion.


Iain Francis Angus: Mr. Speaker, I think there may have been an omission in the opposition House leader's list. Motion Nos. 4 and 7 are Liberal amendments which should be included in the package for the votes on this side of the House.


Mr. Kindy:: I rise on a point of order. There is no unanimous consent, Mr. Speaker.


The Acting Speaker (Mr. DeBIois):: I remind the hon. member for Thunder Bay-Atikokan that all amendments are Liberal amendments.
Is there unanimous consent to proceed as suggested by the hon. opposition House leader?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBIois):: Pursuant to order made Wednesday, April 21, the next question is on the main motion. Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


Some hon. members:: On division.


[Stage Direction]
Motion agreed to, bill read the third time and passed.

[Stage Direction]
The House resumed from Monday, April 26, consideration of Bill C-109, an act to amend the Criminal Code, the Crown Liability and Proceedings Act and the Radiocommunication Act, as reported (without amendment) from a legislative committee.
The Acting Speaker (Mr. DeBIois):: Pursuant to Standing Order 45(5)(a), the House will now proceed to the taking of the deferred divisions at report stage of Bill C-109, an act to amend the Criminal Code, the Crown Liability and Proceedings Act and the Radio Communication Act.
The first question is on Motion No. 1. A vote on this motion will also apply to Motions Nos. 2 and 3.
Government Orders


PAIRED MEMBERS
[Stage Direction]
nil/aucun
The Acting Speaker (Mr. DeBlois):: I declare Motion No. 1 lost and I therefore declare Motions Nos. 2 and 3 lost.


David Charles Dingwall: Mr. Speaker, I rise on a point of order. There have been further discussions and further consultations with my learned and distinguished colleagues, and you might find disposition in the House to apply the vote just taken on Motion No. 1 to Motions Nos. 4 and 7, and that same vote would apply to the motion to concur at report stage of Bill C-109.


Mr. Nowlan:: Mr. Speaker, I rise on the same point of order. There have been consultations here in the power comer and there was also the mental telepathy with the opposition House leader. In this comer where there were not consultations beforehand there is agreement that the vote on the motion we just disposed of will apply to all their motions and the main motion on division.


Lucien Bouchard: Mr. Speaker, we are now part of the establishment. They have spoken to us today so we support the positions taken by the NDP and the Liberals.


The Acting Speaker (Mr. DeBlois):: The Chair has received two suggestions: one from the Opposition House Leader and one from the hon. member for Annapolis Valley-Hants.

May I suggest that it is carried?


An hon. member:: Carried on division.


The Acting Speaker (Mr. DeBlois):: Negatived on division on the motions and adopted on division on the main motion. Is there unanimous consent?


Some hon. members:: Agreed.


The Acting Speaker (Mr. DeBlois):: Agreed and so ordered.
Motions Nos. 4 and 7 negatived.


Hon. Pierre Blais (Minister of Justice) moved: that the bill be concurred in.


[Stage Direction]
Motion agreed to.
The Acting Speaker (Mr. DeBlois):: It being 6.45 p.m., this House stands adjourned until tomorrow at 2 p.m., pursuant to Standing Order 24(1).


[Stage Direction]
The House adjourned at 6.45 p.m.
[Stage Direction]
Wednesday, April 28,1993