Mr. Speaker, Bill C-36, which we are addressing today, deals with the implementation of certain provisions of the budget tabled in Parliament on February 24, 1998.
This debate will provide me with an opportunity to raise, and to criticize for the most part, certain political choices made by the Minister of Finance, as well as to draw attention to everything he has not done and to the Bloc Quebecois' fiscal proposals he has not followed.
The Minister of Finance is boasting that he has managed to put public finances back on a sounder footing. I wish to speak out against what the Liberal government has done to attain that goal, and also what it has not dared to do. In order to attain its goals, it cut transfers to the provinces along with employment insurance benefits and failed to index the tax tables.
Transfers to the provinces were cut by $7.2 billion annually, which accounts for 52% of all the spending cuts the Liberal government made in 1994 and 1998.
Cutting employment insurance benefits means that people who lose their jobs are not as well protected since the reform, while the fund shows a surplus of billions of dollars.
Another thing the government has not done is indexing the tax tables. The Minister of Finance has taken advantage of the increase in revenues, in part as a result of not indexing the tax tables, GST credits and child tax benefits.
It is instructive to look at how the Minister of Finance has succeeded in putting his fiscal house in order, but it is particularly interesting to think about the choices the Liberal government has refused to make in order to attain those results. It has not made a serious attack against waste, respected its commitments, or really reformed the taxation system.
As far as an attack against waste is concerned, year after year the auditor general criticizes the spending of billions of dollars by the federal administration.
As for respecting his commitments, I should remind the House that, in 1995, the Minister of Finance promised a 19% reduction in his departments' spending over three years. In fact, spending was reduced by only 11.5%, so the government could have cut another 7.5%.
We also asked for income tax reform and the Liberal government could have undertaken a review of corporate income tax to help job creation, and one of personal income tax to improve fairness.
The suggestions made by the Bloc Quebecois were flatly rejected by the Liberal government, even though our finance critic did an extraordinary job in proposing concrete solutions to the government.
What did the Liberals do when the first surpluses appeared? They could not keep themselves from doing what they have always done, which is to spend.
Even though the Liberal government's contributions only accounted for 11.5% of the federal spending cuts, the Minister of Finance is making 51.4% of the new expenditures provided in the budget. The Prime Minister and the Minister of Finance have decided to reward themselves for eliminating the deficit, instead of rewarding those who actually did the work, namely the provinces, the poor and middle class families.
Out of all the new Liberal expenditures, the $2.5 billion for the establishment of a millennium scholarship fund was the initiative most strongly criticized by the whole community. As we know, the Premier of Quebec is trying to solve the issue with the support of a coalition that includes a number of Quebec stakeholders.
The Premier of Quebec proposes that clause 46 be amended by inserting the following:
Withdrawal with compensation
46.1 When a province has established and administers a financial assistance program for students to ensure equal opportunities regarding post-secondary education, the ministers shall, at the province's request, conduct negotiations with this province to come to an agreement with respect to the fair compensation it should be paid in lieu of the foundation's activities in the province.
We all know that negotiating with the federal government for fair compensation takes a lot of effort and energy, often with little likelihood of success. In this case, we hope that the federal government will take some responsibility and that, for once, it will be able to come to an agreement with Quebec on the millennium scholarship program.
They know that education is an area of exclusive provincial jurisdiction. For over 30 years, Quebec has had its own system of loans and scholarships. All of Quebec's education stakeholders are opposed to the plan, because it does not meet Quebec's priorities in this area. The only way to avoid duplication is to come around to Quebec's way of thinking. We hope that the Prime Minister will grant Quebec's request.
We also know that the auditor general is critical of the government's spending practices. The foundation's funding has been included in the 1998-99 spending forecasts, although the money will actually be spent in the year 2000.
One of the things we criticized about the budget had to do with the Minister of Finance's transparency. We would have liked to see the actual figures, in the right columns, so that we could have had a real debate about the surpluses but, instead, this year's surpluses have been concealed by including spending that will take place in the year 2000.
Former Prime Minister Pierre Elliott Trudeau said that, if a government had such an excess of revenue and undertook to ensure the part of the common good that fell outside its jurisdiction, there arose the presumption that that government had taken more than its share of taxable capacity.
Quebec has said no to the millennium scholarships, and I hope its wishes will be respected.
There is also employment insurance. Those to whom the federal government owes a large debt include the unemployed, but the government has decided to ignore them. The budget speech is clear: the unemployed have no problem and the EI program will not be improved.
Bloc Quebecois members have introduced six private members' bills with suggestions for improving the employment insurance program. The federal government has accumulated $6 billion in savings in its fund. We asked that the eligibility criteria be restored. In 1989, 83% of unemployed workers were eligible for EI. This dropped to 43% in 1997. The percentage has dropped steadily since 1990.
In order to analyze this phenomenon, which has gone on for eight years, the minister has just ordered his department to do a study, in co-operation with Statistics Canada. Meanwhile, the unemployed are losing out. In committee, we moved that this clearly inadequate percentage be studied. We would have liked a report analyzing the effects of this new employment insurance policy.
The government continues to amass the surpluses without paying out a cent more. In 2000, the surplus will reach $25 billion. Premiums will not be lowered in 1999. They will be reduced by a meagre 10 cents in 2000—not enough. The Conseil du patronat was very clear on this point. They wanted a substantial reduction in premium levels to permit the creation of jobs in business.
The only employment insurance premium holiday will be for employers hiring young people between 18 and 24 years of age in 1999 and 2000. The measure applies to two years only. It is shortsighted. We would have liked the government to consider other clienteles strongly affected by the new employment insurance measures, especially those aged 45 or older, who often find themselves unemployed. We know the focus of business is on young people with experience, those in their thirties, and that older people find themselves without work and the possibility of finding any.
We also introduced anti-deficit legislation. It would control government spending. We deplore this government's refusal. This anti-deficit legislation may be found in five Canadian provinces, including Quebec, in 48 American states, in France and in New Zealand.
We were very disappointed at the policies proposed by the Minister of Finance in this budget. The Bloc would have advocated creating no new programs, reimbursing the provinces for the Canada social transfer, changing how the employment insurance plan is managed, implementing targeted tax cuts and passing anti-deficit legislation.
We would have preferred the minister come to an understanding with the Bloc Quebecois. A number of people have expressed their disappointment with the Minister of Finance's budget. We would like the Minister of Finance in the future to accept some of our suggestions for lightening the tax burden of Canadians and Quebeckers.