[Recorded by Electronic Apparatus]

Friday, November 8, 1996

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[English]

The Chairman: Could we come to order, please.

The Standing Committee on Finance of the House of Commons is very pleased to be here in Toronto today. This is the third of our round table sessions with concerned citizens and various groups who have worked with government and at government.

We are very grateful to you for coming to us this afternoon.

Because we have so many witnesses, I would ask that everybody limit their opening remarks to three minutes. After that we will go to question and answer. If you find that you have not had time to make all the points you wanted to during the opening remarks and the questions and answers, I will assure you as much time as you need at the end to put it on the record.

Thank you again for being with us. We will start with Tony Parker, please.

Mr. Tony Parker (Individual Presentation): Thank you.

I am a Canadian citizen and I live in Burlington, Ontario. My wife is Joy Parker, and we have been married for 42 gorgeous years. We have two sons and two grandsons. I am telling you all this because I am standing here on my own behalf.

My suggestion is that the government take a look at a means of funding our national debt in order to reduce the deficit. I should add that what I am about to suggest has been implemented by the British government with outstanding results, as the figures attached will show.

You do not have the figures. I have them here. I could not print enough.

They are called premium bonds. Premium bonds were introduced to the British public many years ago. They are sold in units of one pound sterling, minimum purchase 100. Numbers are selected weekly and monthly in order to distribute the prize fund, which is a declared interest rate.

As a matter of fact, I phoned London today and the declared interest rate at the moment is 4.75%. So the government is borrowing money at 4.75%, which is very, very sweet indeed.

Winners are notified by mail and the numbers published in the national press. Incidentally, these winning numbers are selected electronically by a machine called ``Ernie''.

Bonds are purchased at the local post office and must be held for one month before they participate in the selection process.

At one time it was claimed that the number of winners each month would fill Wembley Stadium three times over, and it has a capacity of 90,000. I heard today that 350,000 prizes were awarded this month.

Further, prizes are sent out by cheque, together with an application for further bonds, encouraging the recipient to reinvest.

The sale of these bonds reaches a group of people who would not dream of purchasing a lottery ticket. They are used for wedding presents, birthday presents, christening presents, and retirement gifts. They are used in many ways. Obviously there are some redemptions when these are given, but a large percentage remains.

If our government would consider looking into this idea further, it would necessitate a working party going to Blackpool, England, in order to see the system work over there. I am sure the British government would cooperate.

The fact that patriotic individuals do actually send this government cash gifts - and incidentally I am not on that list - to reduce the deficit would indicate that something like this would be more acceptable to the public. The Brits claim that half of the population own bonds. If we could achieve this result, we would be borrowing money at a very low interest rate. We would be self-funding our own deficit, or helping to anyway.

Undoubtedly, while every avenue is being explored in order to come up with a viable means of deficit reduction, someone in government is bound to say they have looked into the idea. If that is the case, we should look again. I am sure it can work.

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Thank you for your kind attention to this presentation.

The Chairman: Thank you, Mr. Parker.

Did you say they bear an interest rate of 4.75% today?

Mr. Parker: Yes.

The Chairman: I don't understand what the prize is that the purchaser gets.

Mr. Parker: My description may have been in error, but it's a bond that bears no interest at all.

The Chairman: Oh, I see. Okay.

Mr. Parker: The factor of 4.75% is applied to the total bond holdings, and that is paid out as prizes each month. If we were doing this, I myself would prefer that we get away from the idea of prizes. Let us call it a bonus or what you will, but that is the declared rate. The public knows that 4.75% of their money is coming back to them. They don't know who it is.

The Chairman: I understand. Thank you very much.

Mr. Parker: Are there any other questions on that?

The Chairman: No. I'll come back to it later. Thanks very much, Mr. Parker. We will come back to you later, and thank you for that very interesting idea.

From the Ontario Coalition of Senior Citizens' Organizations, we have Hank Goldberg. Welcome, Mr. Goldberg.

Mr. Hank Goldberg (Vice-President, Ontario Coalition of Senior Citizens' Organizations): Thank you. On behalf of the Ontario Coalition of Senior Citizens' Organizations, we would like to thank you for providing this opportunity to share our views in preparation for the 1997 budget.

I don't think I am going to have time to get everything in, but I am going to -

The Chairman: We will give you lots of time before you leave here today.

Mr. Goldberg: Okay.

The Chairman: Just get to the main points that you want on the table.

Mr. Goldberg: I would like to discuss the three major areas that should be taken into careful consideration when planning the 1997 federal budget. They are social programs, taxation, and job creation.

First, on the social programs, Canada's social programs have sustained Canadians during one of the harshest recessions. They have made this country the number one place to live in the world. They are an integral part of the Canadian identity. However, last year, when the government announced its budget, social programs were attacked. Last year it announced that over a two-year period $7 billion in transfer payments, which would go directly to cover the costs of education, health, and social services, was going to be cut.

These cuts will have drastic consequences for the social fabric of Canadian society. In the first year over $1 billion will be cut from the funds that are turned over to Ontario.

The implementation of the Canada health and social transfer signals the start of the end of national standards for health care. The Canada Health Act now guarantees that all Canadians have access to the health care system and that it is universal, comprehensive, accessible, affordable, and publicly administered. The Canada Health Act ensures that we have a health care system that is universal and protected from extra-billing and user fees. We see this as the beginning of the end of universality as far as the Canada health plan is concerned.

There are stories that the government is agreeing to increase the contribution rates. OCSCO agrees with this position. One of the things, though, that we don't agree with is increasing the age of retirement from 65 to 67 or 70. We are against that. We think this will hurt women in particular, who are retiring earlier because of family and care-giver needs and therefore would bear the brunt of the problems. They would have lower contributions to CPP and would therefore not collect as much when their time came.

On the other question of taxation, Canadian seniors, like the majority of Canadians, are not opposed to being taxed. We are opposed, however, to the system of taxation in Canada, which is regressive and overtly unfair to the majority of Canadians.

Some of the greatest drains placed on public finances today include the following tax expenditures: retirement savings exemptions, protected family trusts, and corporate tax exemptions. Billions have been lost to the government through these forms of expenditures. An immediate and comprehensive review of all forms of taxation and tax expenditures must be undertaken.

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I would now like to touch on job creation. Canada has a profound unemployment crisis. Reducing unemployment must be a priority. Government must keep the interest rates low to allow the stimulative effect to begin to work.

An essential component of job creation is the creation of jobs that enable people to maintain a decent standard of living. One way of achieving this would be to increase the current minimum wage. Increasing the minimum wage allows people to be financially self-sufficient, thereby lowering social security costs and generating new tax revenues.

One of the other policies we are looking for is a policy to ensure a more equitable distribution of work hours. In 1994 a third of the women who worked part time did so because that was the only work they were able to find. A more equitable distribution of work hours would serve to create new full-time jobs, generate higher tax revenues, and again lower social security costs.

On behalf of our organization we would like to thank you for listening to our views on these issues. There is much more in my brief, but as I want to stick to the three minutes I will end it there.

The Chairman: We will give you lots of time after, Mr. Goldberg.

The next witnesses are from the Citizens for Public Justice. We have Stephanie Baker Collins and Gerald Vandezande.

Ms Stephanie Baker Collins (National Research Director, Citizens for Public Justice): Thank you, Mr. Chairman.

Citizens for Public Justice appreciates the opportunity to have input to the federal government's budget choices.

I would draw your attention to the fact that we have submitted a fuller brief called ``Safeguarding a Caring Society''. Let me make some brief general comments and then some specific recommendations.

We want to speak today about two kinds of equity for Canadians: equity between generations and equity within generations.

Equity between generations means that we use public resources responsibly so that they remain available to future generations. In that regard we commend the government for its progress in reducing the deficit. The suggestions we make today we believe will be deficit neutral.

But there is another kind of equity we must consider, and that is equity within current generations. The obligation of government to chart a sustainable future carries an equal obligation towards those who are currently poor and deprived. We must not pass on a social deficit by ignoring problems whose financial cost will be paid in the future.

We believe society has a special responsibility to children. Given their vulnerable situation they ought to have first claim on public resources.

Finance Minister Paul Martin has made a commitment for income security in terms of pensions to Canadian seniors, but not to Canada's children. The Canada Health and Social Transfer does not protect income support and social services for poor children and their families. In fact, we face$7 billion of cuts in the next two years.

It is already the case that income assistance for poor families and their children and reductions in drug coverage have occurred in Ontario, Alberta, Manitoba, Quebec, Nova Scotia, and Prince Edward Island.

Child poverty is again on the federal government's agenda. Please recognize that the seriousness of child poverty in Canada is related to your own fiscal policies.

Equity within generations requires that Canada address immediately the serious problem of child poverty. In that light CPJ calls on the finance committee to recommend that the federal government work with the provinces towards having an enhanced, integrated child tax benefit in place for the next federal budget.

In order to fund this enhanced child tax benefit, CPJ calls on the finance committee to recommend that the government evaluate taxes and tax expenditures.

Specific measures that could be included would be to lower the maximum annual tax deductible RRSP contribution from the current ceiling of $13,500 to approximately $7,500. This would still allow an adequate annual retirement income of $36,400. We also believe the tax exemption for lottery and gambling winnings should be cut.

CPJ then calls upon the finance committee to recommend that the first priority for the revenue saved by reductions in tax expenditures be to fund the enhanced and integrated child tax benefit.

Finally, in the interests of equity between peoples in the world community, CPJ calls on the finance committee to recommend that the federal government rescind the $975 right-of-landing fee or head tax for refugees and family class immigrants, reallocate funds for official development assistance, and commit itself to raising Canada's rate of assistance in the future to the 7% of GNP that we committed ourselves to.

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In conclusion, in his presentation to this committee the finance minister stated that Canadians expect their government to safeguard a caring society. An important way that this government could demonstrate its commitment to a caring society is to put in place in this budget an enhanced and integrated child tax benefit paid for in part by reductions to tax expenditures. Such a step would honour the requirements of equity between generations and within generations.

The Chairman: Thank you very much, Ms Baker Collins.

From the Etobicoke Social Development Council, we have Mr. Bill Goursky.

Mr. Bill Goursky (Executive Director, Etobicoke Social Development Council):Mr. Chairman and committee members, thank you for the opportunity to make this presentation today.

There are a number of priorities in this community that I could have brought forward this afternoon; however, I will confine my comments to two: community economic development and youth violence.

Over the past number of years much has been said about community economic development and the need to focus our attention and the resources in this direction. However, most of the focus seems to have been in the area of self-employment. This focus certainly has merit, but in Etobicoke we believe there is need for support for groups that are interested in developing their own business and require support and assistance.

For example, we are currently involved with a group of Somali refugee women on welfare, who through an organization, the Somali Women and Children's Support Network, learn how to sew in order that they and their children will have clothes.

Several churches have provided them with sewing machines, material, and a little money to replenish that material. A number of women have become very proficient in their sewing and feel that they could develop a viable commercial enterprise, using an African motif.

Singer Singer Sewing Machine Company of Canada Ltd. has agreed to donate fifteen machines, and there's indication of further financial assistance from churches. The group needs further assistance such as a business plan, mentoring, partnering with industry, assistance in marketing, and inventory control. There is great potential for this group, but no resources to assist them. In our approaches to church groups and service clubs, we have of course requested volunteers, but to no avail.

This is but one group, and I am aware of at least another, that has the potential to develop. I'm sure that there are many more possibilities; however, what is missing is proper information assistance to community organizations and agencies to identify potential and to support those who may wish to pursue this very appropriate capacity-building initiative.

We feel very strongly that one of the best ways to address poverty is employment. Although the federal government is supportive of a number of excellent community initiatives, we feel that this type of community economic development also needs to be added to the continuum of support.

Etobicoke, as have other communities, has experienced an increase in youth violence. The board of education has acknowledged an increase in the past several years of suspension of students because of violence. There appears to be little or no support for programs that allow the youth to become involved in positive creative change in their communities, to become changed agents of their environment.

Rather than take up the committee's time, I have brought a proposal and I have included it. It provides the detail and the type of direction that we feel youth can take part in.

Thank you.

The Chairman: Thank you very much, Mr. Goursky.

From Low Income Families Together, we have Josephine Grey.

Ms Josephine Grey (Executive Director, Low Income Families Together): Mr. Chairman, thank you for the opportunity to address the committee. I notice you had to come out here, and I guess it has been a little rough lately to go downtown.

The Chairman: Why is that?

Ms Grey: You had a little disruption the last couple of times you showed up downtown. I think that speaks to the kind of mood that's currently increasing in our society. I want to give you a couple of examples.

The Chairman: Let me be very clear. I don't think there were disruptions last year downtown. We had some protesters there, they came before us, they sat down, they dialogued with us, and we welcomed it. We've been in downtown Hamilton, and now we're in Etobicoke, in terms of our hearings in Ontario.

People don't come out here to agree with us. We know that and don't expect it. We're looking for what you consider to be the problems and what we might do to correct them. Please feel free to dump all over us.

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Ms Grey: I would prefer to find some cooperative solutions.

I just wanted to give you a little rundown of some of the things we are addressing and why some of the recommendations people are bringing forward are so important.

Currently in metro Toronto we have lost roughly 50% of all services for the poor, youth, immigrants, low-income families, and single moms.

In Ontario there are 30,000 child on the waiting list for child care. Those parents cannot work until those children are placed. We have 130,000 people who will lose roughly 45% of their income when they are redefined as non-disabled. That is a very serious issue. We already have food banks completely stretched to the limit. Use has increased by 32% just in the last nine months or so. The food banks will not be able to take up the slack when these people are redefined and are no longer on disability. They will also be eligible for workfare.

In Canada roughly 45% of the population is unemployed during a three-year period. All of those people are at great risk of ending up on welfare very quickly, particularly because only 47% of them are eligible for UI.

That is a very serious issue. When people have to go onto welfare because they are out of a job, they have to strip themselves of all their security and are left hoping that a worker will allow them to make a few choices in their lives.

Currently in metro Toronto 88% of our employable people on welfare are people from another country; 54% of those have a university education. I know that the people who come through our centre, Low Income Families Together, are very highly qualified and need Canadian experience or accreditation. All of the programs and services to that end have been either cut or reduced.

We are seeing longer and longer terms of unemployment for people who could in fact contribute a great deal to Canada's productivity and competitiveness, if competitiveness has to be such a big deal.

I think this is a very serious situation. We are seeing a lot of devastation. We are seeing massive increase in evictions in Toronto. We are up to 265 evictions a month. In metro Toronto families outnumber singles in shelters.

There was a shelter in Thunder Bay that had to move the food bank out of the basement to accommodate more women and their mattresses on the floor of the basement.

It is almost hard to tell you about it, because it is very emotional. I have to deal with people who are going through this.

Some of your responses in regard to increasing working income supplements for low-income families are a little inadequate. If you put an income ceiling of I think $25,900 and something - I know I make $27,000. I have four kids, and I cannot survive on $27,000 because I have to pay for my child care. A ceiling of $25,000 is just not good enough.

I support other people's call for a much improved child tax benefit. I think that is your first and foremost task. You have at least $160 million from the premature elimination of CAP, which could be put towards that end and should be put towards that end.

For a slightly broader solution I think it is really important to start to introduce social and environmental audits as a way to assess whether or not any kinds of policies or even corporate decisions are viable.

You now have a sustainability clause in your Auditor General Act. I think you should take it seriously and apply it as broadly as possible.

There are other things I would like to say, but basically I think it is really important to start looking at how we can reinvest in our communities; find ways to boost local economic strength; start giving priority to small business development and low-income business development, because those are the people who need it the most; reduce the priority to the corporate sector; and ask the corporate sector to pay the debt that they owe to this country on all of our pasts.

The Chairman: Thanks very much, Josephine Grey.

From Women's Health in Women's Hands, we have Sandy Prince.

Ms Sandy Prince (Chair, Board of Directors, Women's Health in Women's Hands: Hello.

The Chairman: I am trying to limit everybody to three minutes on the first round.

Ms Prince: Okay, it is not a problem.

I want to quickly describe what Women's Health in Women's Hands does.

First, it is a metro-wide community health centre for women. We categorize four main groups of women: young women, older women, disabled women, and immigrant refugee women. One major program we have at Women's Health in Women's Hands is FGM, which is female genital mutilation. Given the global climate we are in right now, with major cutbacks to health centres, we are finding that we are not getting the money to actually get this program on the road.

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We need to really push the training and education in female genital mutilation. We also need to work with governments, schools, and the community at large to educate on the issue of FGM, as well as do a lot of advocacy work.

We have three units within the health centre: the mental health unit, the clinic, and the health promotion unit. The main emphasis of the two health promoters we have at women's health is advocacy work. That is where the money is needed, to do this advocacy work on the FGM issue.

We also want to increase the support groups. We do fund them for low-income women. They don't really have a lot of self-esteem, so we really need to increase their self-esteem with programs such as parenting and housing programs. We have a gardening program going on right now, in which a lot of these low-income women participate. This again increases their self-esteem.

For the refugee women we service, the problem is that they can't access service. Their refugee status is not a strong enough status for them to access services, mainly health care.

We have reproductive health services at our centre. We really want to push advocacy in regard to reproductive health with the young women. We want to target the high schools. With reproductive health we are looking at FGM issues, violence, body issues. Everyone thinks a slim body is the big thing. Pregnancy options and counselling are included.

We want more work on women with disabilities; for example, support groups or groups for women with disabilities regarding their sexuality. People are labelling people with disabilities. They are not regarded as people, but as people in wheelchairs or people who are immobilized. People with disabilities are people. They need access to services and we really need to push it, especially with - I'm going to use the word again - sexuality. People don't think people with disabilities are human, that they can reproduce, but they can.

We want programs for older women. We really want to push that because a big problem with older women is isolation. We have ties with the Metropolitan Toronto Housing Authority. With our clinic unit we want to do some satellite clinics. The problem with older women is transportation; for instance, women with wheelchairs. They can't get out of their homes to access these services, so we really want to push something like a satellite clinic, whereby we can go to these women to bring these services to them.

I could go on for hours here.

The Chairman: What would you like us to do?

Ms Prince: The bottom line is that we really want to push advocacy work and have access for these people.

The Chairman: Yes. How can we help you?

Ms Prince: More money.

The Chairman: More money.

Ms Prince: Funding. Again, it's based on the cutbacks. We are losing out on employment, on employees. We have to reduce our people hours. That's a big concern here. The bottom line is the almighty dollar. It's just more funding. We don't like the cutbacks, but they have happened and are hurting us.

The Chairman: Thanks very much, Sandy.

Ms Prince: You're welcome.

The Chairman: From the Canadian Association of Retired Persons, we have Lillian Morgenthau.

Ms Lillian Morgenthau (President, Canadian Association of Retired Persons): Hi, Jim, how are you?

As Mr. Peterson already said, my name is Lillian Morgenthau. I am president of the Canadian Association of Retired Persons, CARP.

There are two presentations in front of you. One is the short one, which I will give, and the other is a longer brief, which I will leave for your perusal later on.

CARP is a national non-profit organization with over 250,000 members across Canada aged 50 and older, retired or not. We receive no funds from government, thereby ensuring our independence and impartiality. Our mandate is to foster, promote, and advance the interests of mature Canadians, and indeed all Canadians regardless of age.

CARP is here today to present the perspective and to voice the concerns of mature Canadians as we offer practical and positive recommendations for the 1997 federal budget.

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Because of time restrictions, what I am about to say to you is just a brief résumé of our views. Our complete presentation has been presented to each member of the committee, and I will be happy to go into more detail with you at the conclusion of my remarks.

I do thank you for this opportunity to speak with you today, although I really would have preferred that it was not in Etobicoke. You have to have a car to get out here, and then when you go by the Burnhamthorpe cut-off you have to find a way to get back here.

The Chairman: I know the problem, but Mr. Campbell will be very pleased to give you a ride home.

Ms Morgenthau: I have the car.

The Chairman: Well, he will be happy to drive it home for you.

Ms Morgenthau: All right. Can he drive? You know, older people have only fender-benders. They don't have other things. I am not sure about Mr. Campbell. He looks a little young.

Mr. Campbell (St. Paul's): I am not 50, but I am not far off.

Ms Morgenthau: We are starting the Canadian baby boomers for you.

Mr. Campbell: Okay.

Ms Morgenthau: In the overview you have in front of you, the Honourable Paul Martin described his 1995 budget as one to reduce anxiety. I am here to tell you that, on the contrary, rolling the old age security and the guaranteed income supplement into a new seniors' welfare benefit, the proposal to partially de-index pensions, and the changes to RRSP contribution rules have all sown fear and confusion amongst older Canadians.

I am not really sure you should have called it a new seniors' welfare benefit. Seniors don't like welfare.

An hon. member: We didn't call it that.

Ms Morgenthau: What are you calling it?

An hon. member: Seniors' benefit.

Ms Morgenthau: Ah, how nice, you took out ``welfare''.

An hon. member: It never was there.

Mr. Fewchuk (Selkirk - Red River): What would you prefer?

Ms Morgenthau: What would I prefer? Send me a letter and I will tell you.

In our view, there is no crisis in the Canada Pension Plan. The last wave of baby boomers will not be 65 until 2030, by which time the majority of those now 65 will be dead.

The Chairman: Not if we have our way.

Ms Morgenthau: Well, take my word for it. That gives us 34 years to make the necessary adjustments. We fully agree that the plan must be kept viable for future generations.

We vigorously oppose any attempt to partially de-index public pensions. We also oppose moving the official age of retirement upward from the present 65, especially as Statistics Canada tells us that people are, on the average, retiring at age 61.

We do agree that the rate of contributions to CPP and QPP should be increased gradually over the next eight to ten years.

We also endorse B.C.'s recommendation that the income level for contributions be increased to $50,000. Mr. Martin seems to have dismissed this suggestion out of hand without giving any actuarial reasons for so doing.

We believe the so-called funding problems facing CPP can be overcome by adopting better investment strategy. CPP funds should be segregated from the federal government's general operating funds and administered by a crown corporation, which issues annual, audited financial statements to the public. We remind the public that CPP is -

The Chairman: Are there any other points about the CPP that you would like...?

Ms Morgenthau: It is a contract. It is not an entitlement.

The Chairman: No.

Ms Morgenthau: Well, there are a couple of things here. This is my short one. Think of my long one.

The Chairman: It must be stunningly beautiful.

Ms Morgenthau: It is. It is typewritten, not even in my handwriting.

The Chairman: We will have time to come back to you, if you don't mind. I just want to get some of the things on the table so people can react to them.

Ms Morgenthau: Okay. I will bow to the chairman.

The Chairman: I've never had that happen to me in my life.

Lillian, thank you very much.

From the Ontario Coalition for Better Child Care Network, we have Ms Rothman.

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Ms Laurel Rothman (Executive Member, Ontario Coalition for Better Child Care Network): Thank you. I am also representing the Child Care Advocacy Association of Canada.

I want to say very clearly that I am glad to hear the shared concerns about the future of children in Canada. We have had some encouragement from Mr. Martin's remarks over the last month or so about wanting to invest in children. We will look closely for the actions to follow.

Both the Canadian organization and the Ontario organization see child care as a multifaceted service. It's first and foremost a healthy child development program. It's also a support to families in education, in training and/or in the labour force. It's a key tool in eliminating child poverty, and it is of course, as Rosalie Abella said many years ago, the wheelchair ramp to women's equality in the workplace.

We believe that all families should have voluntary access to the system to the degree they want, irrespective of region of Canada, participation in the labour force, age of child, special needs or income of the family. I say that because around the table we have other groups involving children's services. I wish to say that we work closely with and see other services as well integrated with what people's regular perception of child care might be.

With regard to federal spending on child care, I want to make a couple of key points. I was here last year and I'm sorry to say it is not a good-news story. Estimated federal spending in 1993-94 on child care services has decreased approximately - and I say approximately because it is difficult to pull together the pieces of information, and there is more detail in the submission - from $361 million to $40 million. That's a tremendous reduction. That is despite the fact that the economy has grown more than 3%, which was one of the preconditions for implementing the red book commitment on child care; the fact that lending and mortgage rates are at a forty-year low; and the fact that the federal government has exceeded its deficit reduction targets.

With the elimination of the dedicated spending for child care through the Canada assistance plan as of March 31, 1996, and the introduction of the CHST, which has no guidelines or principles for spending, and the significant reduction in federal transfers that other people have talked about - I understand it's $7 billion over two years for health, welfare and post-secondary - the fragile network of child care services is crumbling further.

I might add, as I've said before, that we don't have alumni organizations like the universities. We don't have powerful boards of directors like the hospitals. We have mostly volunteer parents who come and go after a couple of years because of their attachment to the service.

Let me give you a couple of facts and a recommendation.

In Manitoba the budget for child care services has been cut 10%. In rural areas the situation is grave and has been described as a health and safety issue if you are trying to work on a farm and don't have child care.

In Newfoundland the provincial government has neither the financial capacity nor the political will to alleviate the child care crisis. There is no regulated child care for children under two years.

In New Brunswick all grants to child care programs have been eliminated. Post-secondary students no longer qualify for fee subsidies and usually cannot afford the full fee.

In Ontario child care is under attack. The current proposals of the Harris government, if they are implemented, which I suppose is quite likely, will decrease the quality of services by reducing monitoring, inspection, and health and safety standards, and by eliminating the wage grants that have helped to make early childhood education a profession in which you could afford to stay while keeping parents' fees from increasing that much.

The brightest place in the country is Quebec, interestingly enough, where the government will develop a comprehensive early childhood education policy. That will result in a range of services for all children at reasonable fees and will be complemented by enhanced maternity and parental leave policies. The Quebec financial situation, if I believe and understand what I read in the paper, is perhaps in some ways not among the strongest in the country, yet that province has taken the political will to invest in children and has described it that way.

I might add that our organizations, both the Ontario and the Canadian ones and our partners across the country, have met with the women's Liberal caucus, the women's social policy caucus, and many of you individually. I was pleased with the arrangement for Mr. Campbell to meet briefly with Mr. Pettigrew the other day.

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Oh, I forgot to bring you our poster. I hope you've all seen it. It says ``Keep the Promise on Child Care''.

We gave you a very concrete suggestion, and Mr. Young wrote back saying it wasn't the right time. I'm going to suggest you might want to look at that again, considering the timing around going back to the people of Canada for their consideration sometime in the next year.

Our recommendation is that you establish a short-term task force that is solution-oriented, with the goal not of determining the need for child care but of determining how to break through the identified impediments to the promised child care plan for Canada.

I say that because we know there's been a bit of a disagreement about which of the provinces are interested and which aren't interested. We have letters saying they would like to talk more. In fact we know that in September the then minister, Doug Young, said to the social services ministers, ``If you come up with something by December 15 that you can agree on, we'll consider it''.

We want the federal government to take its responsibility seriously and take some initiative.

The first important step would be to work with the provinces to facilitate agreement on a set of broad principles that would set the tone for further discussions. We want to see some action in a couple of months so it's in the next budget.

The Chairman: Thanks, Laurel Rothman.

Welcome, Ms Liz Rykert from Growing Up Healthy Downtown.

Ms Liz Rykert (Growing Up Healthy Downtown): Hi. I'm here to speak on behalf of CAPC programs, some of which are from across the country and some of which are right here in the city.

Community Action Program for Children, which is what CAPC stands for, is part of the child development initiative that was formed in response to Canada's commitment to the UN to address child poverty in this country.

CAPC programs were announced back in 1993 as ongoing. They were to be developed with existing programs that people knew worked. They were to build local partnerships with parents, service-providers and others at the community level to foster comprehensive responses and build on local assets in the community.

We have discovered that in the early months of 1995, funding to these programs was cut by 51.9%. That means the annualized amount of $68 million that had been scheduled for expenditure in 1997-98 will be reduced to $33 million. These cuts are not being applied equally across the country, and at a time when we know Canada ranks second to last of 18 industrialized nations in child poverty, after taxes and transfers, this is appalling.

So I came today to talk to you about what we might be able to do to find that $35 million. I feel a little bit like a mouse, because it's not a lot of money.

One of the things we are discovering in working with our programs is a trend of being able to attract local investment of other dollars from other jurisdictions and from the private sector.

We're able to increasingly attract local volunteers and use that time very well at the community level to build local skills and to understand that no matter how effective our parenting support programs or our efforts at nutrition are, families are not going to do well if they don't have adequate income transfer opportunities and access to affordable quality child care.

Typically when we find families, they're very isolated; they don't know anyone else in the community. Often they speak another language. Since 1994 we've served over 1,300 families representing 35 different language groups here in the downtown area.

Once they get involved in our programs, they discover a safe place, they start to develop local informal support systems and they start to want to explore employment opportunities. They want to get themselves off the system, but they can't access those things right now.

We recognize that we can't come here looking to have that money restored if we can't do it in collaboration with the other parts of the system that are working to address inequity for children in this country.

I believe the federal government is the only body in this country that has the capacity to provide leadership in all three areas and to represent Canada on the international front to address our record on child poverty. That's why I'm here.

The Chairman: Thanks very much, Ms Rykert.

Welcome, Jim Mahaffy from the Canadian Association for Community Living.

Mr. Jim Mahaffy (Member, Canadian Association for Community Living): Thank you. I'd like to thank the committee for allowing us this opportunity to present before the committee today.

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The Canadian Association for Community Living is a national association that advocates with and on behalf of people who have a mental handicap. It is a federation of ten provincial and two territorial associations that are made up of 400 local associations. Its 40,000 members include people who themselves have been labelled as having a mental handicap, and also parents, families, professionals and advocates.

We are here today because we believe that economic strength derives from a strong civil society that includes all people. We believe many fiscal policies and programs that exist now work counter-productively towards the inclusion of people with disabilities in society and in the workplace. This situation not only creates a great disadvantage for people with disabilities but it is also detrimental to the economy and to Canadian society as a whole.

We believe there are many practical and constructive ways in which fiscal policy and programs can be directed to help people back into society and into the workplace. Many of them directly concern the work of this committee; we wish to present them in our written submission today. It includes a discussion paper on the tax system and the cost of disability supports.

CACL supports the recommendations made recently by the national task force on disability. These recommendations, if implemented, will help to ensure that people with intellectual disabilities are supported so they can participate in the social and economic life of the country.

The citizenship of individuals with disabilities and their participation in the labour force require that the federal government acknowledge and address the costs of entry and participation in the labour market and in society for people who have a disability. CACL urges the finance committee and the Minister of Finance to play several roles in the promotion of these objectives.

First of all, there should be a recognition that tax policy can and should support social policy objectives of inclusion, independence and productivity.

Secondly, the support for federal government initiatives that address the exclusion of people who have a disability from the labour market should be addressed.

Thirdly, the leadership in the coordination and development of federal-provincial roles with respect to the promotion and participation of people who have a disability in the labour market and in their community should also be addressed.

It is somewhat of a conundrum for the people who have a disability. If they make the commitment to enter the workplace, they often lose eligibility for a number of supports and programs. It's often a matter of the cost of their disability and the supports they would need to enter the workplace that are the deciding factors on whether people can work or not.

We feel this is a tremendous loss to the Canadian public. We have estimated that over $4 billion annually could eventually be recovered if people with disabilities were fully participating in the economic workplace of the country.

The Chairman: Thank you very much, Jim Mahaffy. I want to come back to that later.

From the Hamilton Civic Hospitals Foundation, we have Stephen Woeller.

Mr. Stephen Woeller (Director of Donor Relations, Hamilton Civic Hospitals Foundation): Thank you.

While my comments reflect the funding needs of the hospital I work for, they apply to the charitable sector as a whole. So I am concerned with raising money for the hospital - however.

As a representative of the Hamilton round table of the Canadian Association of Gift Planners, the CAGP, I am pleased to address the members of the Standing Committee on Finance. As the director of donor relations for the Hamilton Civic Hospitals Foundation, my role is primarily to encourage plan giving in support of the Henderson and Hamilton General Hospitals.

The tax incentives included in the 1996 federal budget relating to the annual limit for charitable donations, bequests and gifts of appreciated property were a strong signal to us that the government understands the role of the charitable sector and the challenges we face to make up the shortfall in the funding of our respective sectors.

The health care sector has to become less reliant on government funds. I would like to encourage this committee to recommend the elimination of the capital gains tax on gifts of appreciated property. This would go a long way to equipping us with the tools we need to be less reliant on government and to encourage and enhance the health of our communities.

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Over the last two years I have completed more than 250 interviews with key supporters of the hospitals. In these interviews I am trying to assess the charitable intent of individuals, many of whom are average working Canadians with a sincere concern for their hospitals.

It's widely recognized there is a great deal of wealth in our part of the province. Much of this wealth is in the form of appreciated assets. In an effort to make up the funding shortfall, fundraisers from the health care sector feel the elimination of the capital gains tax on gifts of appreciated property would be the best way to encourage gifts from appreciated assets.

Individuals with charitable intent would have a greater opportunity to support their favourite charity or charities in a significant way that would not likely be possible from income. These opportunities, given the asset base of our donor population, are likely to benefit not only the large national charities but also smaller local community needs, including the hospitals and nursing homes.

At the Hamilton Civic Hospitals Foundation it is our intention to hold all of these planned gifts in endowment. Over the last seven years we have been able to create an endowment fund of$8 million.

We did receive one large gift from one main benefactor of $2.2 million. But it is important to point out that the balance of this fund has really been made up of contributions by average folks who are concerned about the health of the hospital. It is not just something wealthy people do.

Out of all the proposed charitable incentives, we feel the elimination of the capital gains tax is the best tool for helping to become less reliant on government funds and for us to continue to meet the health care needs of our communities.

The Chairman: Thank you very much, Mr. Woeller.

Could I turn to Ms Whelan for questions, please?

Ms Whelan (Essex - Windsor): Thank you, Mr. Chairman. Perhaps I could get some clarification. I'll start first by addressing a question to Mr. Goldberg, and then perhapsMs Morgenthau would like to respond to it as well.

Mr. Goldberg, you mentioned in your presentation that the problems should be with the current generation. I'm not sure if I misunderstood, but are you proposing that we can only be put on a firm footing by changes in the rate right now? Is that the only change we should look at as a committee? Did I misunderstand that?

Mr. Goldberg: No, I had many things that I could put there. I was just skimming over some of the items.

Ms Whelan: I'm talking about CPP.

Mr. Goldberg: We're not specific. We say there should be some changes, but CPP should not be looked at as a way to save money for the government.

Ms Whelan: I misunderstood that. I don't believe anyone thinks CPP is a way of saving money for the government.

This brings me to my question for Ms Morgenthau. We have to look at the issue of the retirement age, and we have to look at the issue of what's happening in this country.

Whether we agree or not with David Foot's theory of ``boom bust echo'', we have to look at the facts he lays out in there. He believes that the retirement age of 65 was set when the average person didn't live past 61. That is the reality of it. A lot of these programs were developed when people did not live as long as they are living now.

We have to look at that. I am assuming that if that's what happened in the past 40 years, in the next 40 years we are going to live even 10 years longer. The average life expectancy is now in the seventies, so I am assuming the average life expectancy is going to be in the eighties as we progress and expand in our health care system.

You don't want to live that long, Mr. Peterson. I'm just checking. I wasn't sure.

The Chairman: I am just wondering if the solution you're heading for is that we would have capital punishment reintroduced.

Ms Whelan: No, that wasn't it at all. My concern is that we have to look at the social programs that were introduced 30 years ago and adapt them to the next 30 years.

One of the things that bothers me about Ms Morgenthau's brief is that while low interest rates are good for borrowers, they play havoc with seniors on fixed incomes. I recognize that, but I also recognize that my parents, who are seniors, benefited from those low interest rates when they bought their home 35 or 40 years ago. So why are you saying to the youth of Canada today they're not entitled to the same benefits we had and that put us in the position we're now in?

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I'm not sure what the message is to the young. I don't usually take this position, but I feel as though I need to advocate for the youth of Canada today.

Two seniors in my riding, one of whom has been active in CARP, have very interesting discussions. The one I give a lot of credit to recognizes the benefits of what she has been able to accumulate, the wealth she has been able to accumulate, in the last 50 years in Canada. She says if we have to tighten the belt, then as seniors they'll pay their fair share, and shouldn't be left out.

Now, are you asking us to leave you out of the equation and put it all on the youth of Canada?

Ms Morgenthau: Who are you asking?

Ms Whelan: Both of you.

Ms Morgenthau: You can't ask both. You can ask him or you can ask me, or he can go first and I can go after.

Ms Whelan: Well, I'm asking both of you. If you'd like to go first, go right ahead.

Ms Morgenthau: You've asked the lady. All right.

First and foremost, when you're talking about low interest rates and high interest rates, buying a home at this and that, when we went out with $5 thirty years ago, we could walk out of a grocery store and have three bags in our hands. When you go to a grocery store today - and I just did that - you cannot walk in with $50 and get the same you would get for $10. So the inflation we have had overrides all this business about buying a house at so much and now you're getting so much.

The other thing you're missing completely is the fact that this professor in British Columbia has already said that the average age of boomers is 37. You're not going to get an influx of millions of people at 50 who are going to be running into this age of 65. We're saying the CPP and all the changes coming along must be done at an age and in such a way that you can accustom yourself to them.

For example, in the United States they raised the age from 65 to 67, but they took 30 years to do it. With the last budget, when Mr. Martin went from 71 to 69, he chopped off at least $9,000 for a person who had to go into a RRIF. So you're not looking at the equation the way it really is.

Ms Whelan: With all due respect, I do believe I am. If you look at the wages 35 years ago, what you made per hour and what you could buy for $5 versus the wages today, and what you can buy for the same amount of an hour's wages... I mean, I have heard these scenarios over and over from Agriculture Canada. You can buy a lot more food today for an hour's wages than you could 35 years ago.

So if you want to weigh everything -

Ms Morgenthau: I think you're wrong.

Ms Whelan: No, I know I'm right on that.

Ms Morgenthau: When I was working, I want you to know, I thought if my husband had made $20,000 a year, I would have been in seventh heaven. If he made $20,000 a year now, I would not be in the same heaven.

I'm saying that whatever changes are coming up should be discussed with people first. Therefore, before we are in...what is it, the pot into the fire or the fire into the pot?

Jim, you know how to say that.

The Chairman: My mother told me never to use that phrase.

Ms Morgenthau: Here, we let you.

Ms Whelan: You're definitely right. That's why we're here today, and that's why we need to have these discussions. There are ongoing consultations right now on that.

Ms Morgenthau: If you had read this particular article you would find that if Mr. Martin wants to do what he is saying he would like to do - and the balloons are up there - you will have$150 million to work with. It will all come off of the CPP, the way it's going to be redone. That's not necessary. The CPP does not have to be changed. There is no crisis in CPP. That is our position.

Ms Whelan: Ms Morgenthau, I agree with you that there is no immediate crisis with CPP, but there is that long-term effect in the United States, which you talked about, where they are raising their age from 65 to 67. When you look at what they're doing in the United States, their social security is very similar to our CPP.

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Ms Morgenthau: Not exactly, and the old age security is actually gone, with the putting together of all of... The universality is gone.

Ms Whelan: No, I am talking about the United States. Their social security is comparable to our CPP.

Ms Morgenthau: But they are not touching it, really.

Ms Whelan: They are changing it. They are giving them thirty years' notice.

Ms Morgenthau: Yes, thirty years' notice. The notice we are getting is practically not there. What we're saying to the young, to you, is don't save. That's wrong.

Ms Whelan: Oh, I totally disagree. I can tell you that none of my friends or colleagues in the same age category as me would think that they shouldn't save. They think the exact opposite.

Ms Morgenthau: Not in your RRSPs.

Ms Whelan: Oh, definitely in RRSPs. They don't expect anything to be there in thirty years' time. If they can afford to save, they save.

I just think we all have to look at this together and not try to single out one group over another. There are a lot of people living in poverty today in Canada, and those issues have to be addressed. We have to look at the poor seniors and address those issues as well - not just the youth who are living in poverty, but the seniors as well and everybody in between. I don't think we can leave any group out when we talk about what's going to happen. We all have to share the burden of putting this country back on track.

Ms Morgenthau: But the way we're doing it is by not tapping it; we are slicing it and we are using a hammer.

Ms Whelan: Well, Mr. Duhamel is not with us today, unfortunately. He is doing a task force right now on the aging population, and I hope your group is going to submit something to him.

Ms Morgenthau: If he asks us to, I can assure you. Even if he doesn't ask us to...

Ms Whelan: I'll make sure he does ask you.

I have one other brief question. I noticed this in the brief and I'm not really sure if I misunderstood the context in which it was mentioned. Ms Grey's proposal makes a comparison between visiting downtown Detroit and downtown Toronto. I'm not sure if you can make that comparison unless you understand what happened in downtown Detroit in the 1960s.

Ms Grey: It is a warning. I am not saying that's the way it is; I am saying that's the way it could become. It is starting to happen in Toronto. We are seeing the wealthier people come out, except for in the gentrified areas. In the gentrified areas, we are seeing people getting squeezed tighter and tighter and unable to sell their homes. We are seeing increasing homelessness and devastation. That's all I was saying. And we've lost a lot of industry just like Detroit did.

Ms Whelan: There would perhaps be better cities to compare to, in my personal opinion, because of the circumstances in Detroit in the 1960s. There was a riot and a burn-out, and I don't think you are going to see that in Canada, hopefully. We just saw it in Los Angeles not too long ago, but hopefully it won't ever happen in Canada.

I agree that there are problems in some major cities in the United States. I'm just not sure if Detroit would take kindly to using that as an example in the United States. Living in Windsor across the street and seeing what's going on there with their revitalization efforts to try to change that... That's my only comment.

Ms Grey: I understand. The other reason I mentioned it is that Michigan was one of the first jurisdictions to actually cut people off welfare. I personally know quite a lot of people in the anti-poverty movement in Detroit, and I know that about half the membership of the anti-poverty movement in Detroit died within a year after the cuts. That's why I mentioned it, because it's close to my heart. I know a lot of people there, and I can see similar things starting to happen to us. That's why I raised it. I wasn't talking about the physical infrastructure.

I realize they are doing a lot to revitalize. In fact, they are using some kinds of mechanisms that this government could use in terms of putting specific resources into local economic revitalization in urban centres. I think it's time we did that here. We could take the Community Futures model and apply it to the urban centres, and make sure that they build the capacity of the community organizations to start linking capital to the unemployed and getting more businesses started. The things they are doing in Detroit are things we could be doing in Toronto.

The Chairman: Thank you very much. Mr. Fewchuk, please.

Mr. Fewchuk: Good afternoon and thanks for coming.

I am sitting back here thinking about what I heard about a month ago from a couple married for fifty years. They asked me if I was on the finance committee, and I said yes. They asked if I travel this country. I said yes. They said they could not understand what some of their senior groups were concerned about. They said that they live on a total of $19,200 a year and they have a comfortable living. They cannot see why the others are so concerned. They must be a different class of seniors, they said, with more money, and there must be something they want to keep.

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So here I am puzzled again today, and wondering if they are right. Is there really a different class of seniors with this pile of money trying to protect it? This is my concern. Do you have an answer for that? I am caught in this dilemma by the people on the street who are asking me for this answer.

Mr. Goldberg: I would like to say something on that. I don't know where those people, a couple living on $19,000, are living, in what part of the country, but certainly if you are living in metro Toronto, $19,000 wouldn't get you past three-quarters of the year. The cost of living here is much higher than in other parts of the country where you may be able to live for $19,000.

Let me get back to what Ms Whelan was talking about, and one of the concerns we have. Since we've lost universality in the Old Age Security and in other plans that we think are coming that way, the young people are going to start being concerned. Why should they, through their tax money, support anything to do with old age pensions, and so on, because they are never going to get it. By cutting away the universality, you're just going to have more opposition to have any kind of pension, except for the very poorest.

Again, through different parts of the country, you are going to have different standards as far as what's required in income. When you work for 40 years at a job, and you're considering all the ramifications of the day you retire and the standard of living you'd like to have, it's certainly not the same as when you were working.

Suddenly you're faced with that retirement, and your income is fairly well stabilized in that retirement. All of a sudden, there are cuts starting, with threats of cuts coming along that are going to threaten the standard you worked on for so many years, and you have no way of recouping. You can't go back to work.

If people are working when prices go up, they go for raises. They may work overtime - who knows? But a person who is retired does not have that option; they have to make do. All it does is reduce their living standard, reduce the thing they worked 40 or 50 years of their life to achieve.

Mr. Fewchuk: I have one more question for you with regard to the RRSPs. They told me now that if they knew what they did when they started to save some small RRSPs... They are now past the age of 71, and now they're penalized. They say that if they'd known that, they would never have invested in RRSPs.

Mr. Goldberg: Well, that...

Mr. Fewchuk: Well, okay, what's your answer for that?

Mr. Goldberg: But how many people? Up until the last few years very few people were able to put away the kind of money that they needed in RRSPs. It's only the young people who have work. If you haven't got a job, you're in trouble there, too.

Ms Morgenthau: May I say something for a moment about the RRSPs? When the RRSP started, you could put away $1,000. It wasn't really something you thought about very much. It only became evident that it was a good thing to do, because it was a forced saving at the time, and you got your tax rebate.

If you turn 71 now, and you had to put your money into an RRIF, forget it, kid; it's not going to bring much to you. At one time the RRIFs were closed, and CARP got it opened up so that you could put some more money out. But now older people -

Mr. Fewchuk: That's me.

Ms Morgenthau: - are starting to live on their capital. That's not what you want, because you're going to have a third of them on welfare.

Mr. Fewchuk: Thank you. That's the question they asked me, and I'm glad I put it out to get your opinions.

The Chairman: Well, I think Mr. Vandezande wanted to add something to that, if you don't mind.

Mr. Gerald Vandezande (National Public Affairs Director, Citizens for Public Justice): Well, Mr. Chair, I think this is a helpful discussion, provided that we put it in a context.

The finance minister has made a very clear commitment to seniors, and this government has done so in some respects. Although it happens among seniors, the real problem in this country is the five million people who live below the poverty line. The real challenge this government faces, in keeping with its own election promises in 1994, is how we are going to deal with the inequities within generations, between generations, and among the regions.

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I think this discussion is a challenge to your committee, to come to grips with what you yourselves recommended in 1994, when you reminded the finance minister and Parliament in your 16th annual report that the government and Parliament must address poverty. I think it needs to do that in a very serious and systematic way. It should not be depending upon elections, come out with some phrases, and then hope people will forget it.

Frankly I'm perturbed that the opposition parties aren't here. I think it's an indication that they're not interested in national policies and the plight of the poor, and I want this to go on record. I'll write Mr. Manning and the leader of the Bloc Québécois personally. I think it gives people a feeling that some of these fundamental inequities aren't on our agenda, so therefore we aren't going to listen to the people who want to deal with them.

Ms Whelan raised a good question: how do we settle these questions? I think it's high time that in this country we get an arm's-length, independent body that not only begins to check what people really need to live on, but also works closely with the government, and determines what adequacy means in this situation, whether it's for seniors, single parents, child care benefits, for anything.

In the kind of complex society we live in, no one body should unilaterally make decisions, as this government has done with respect to unemployment insurance, as the Harris government has done with social assistance, as the Harris government has done on a number of fronts. We don't only want consultation; we want participation in the development of policies and in the kind of policies that ought to go forward.

Then we can take care of some of the examples raised by Mr. Fewchuk, because they can be part of the discussion. Then we can deal.

I met for 2.5 hours last night with all the members of metro council. We had to ask ourselves, what do we do with the looming crisis in metro, which is coming close to Detroit - there's no question about that.

It's a different kind of origin as far as the crisis is concerned, but there are 6,000 young people sleeping in the streets at night, Ms Whelan. There are five million people living in poverty in this country. Proportionately that is roughly the same as the situation in the United States.

Metro council is highly upset, and I promised I'd convey that here, that the federal transfer payments to the provinces have been reduced sharply, the child care commitment was abandoned, and a number of other policies and programs have been squeezed in order to meet the deficit and debt reduction.

Now, we are all in favour of that, but as the red book said, and as Mr. Martin said to the committee on October 16, there has to be an integrated policy approach, and no one gets hurt in the process.

Now, numerous people are getting hurt, because the Liberal Party isn't coming through in terms of its promise to have an integrated policy that does justice to all the deficits we're dealing with - social, educational, environmental, as well as the fiscal deficit.

So I'd want to plead with the committee to repeat to Parliament and the finance minister what you said in 1994 in your 16th report: ``To ensure that needy Canadians, including children in poverty and the working poor, receive assistance''. I think the words ``receive adequate assistance'' should be there.

Those who need help the most must not be made even more vulnerable, and should have the right to appeal the denial of assistance.

When Bill C-76 was introduced - and Mr. Peterson will remember - we appeared before this committee, and we were promised that there would be consultations with respect to the standards, principles, objectives, goals and conditions under which the CHST would operate. No such consultation has taken place. We've written numerous letters, open letters, faxes; we've had phone calls and we've had meetings. And the first consultation has yet to happen.

Then there is a letter I got yesterday from Mr. Pettigrew, and there is a story in The Globe and Mail yesterday that we really won't have standards, if Mr. Pettigrew has his way. In Mr. Martin's presentation to the finance committee, he made no hint that there would be standards.

I'm concerned that the Liberal Party is no longer interested in this historic Liberal legacy of ensuring that there be no poverty in the land, and that it has succumbed to the Reform agenda of balkanizing and provincializing Canadian politics. We no longer have national leadership.

Mr. Fewchuk: Well, I don't want to cut you off here -

Mr. Vandezande: Well, you are, Mr. Fewchuk, and I want to finish.

Mr. Fewchuk: You just triggered something in my mind. Okay, go ahead.

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Mr. Vandezande: I'm pleading with you, as the last party left that has official House of Commons... I'm pleading with you to really speak out for the poor, to really ensure that your commitment with respect to child care and the poverty-stricken families...that something is finally done.

And if that means closing the tax loopholes such as the nearly $1 billion on lottery earnings, converting the RRSP to a tax credit, reducing the cap and taking other measures, eliminating the cap on the chargeability of earnings when it comes to unemployment insurance...

I brought with me a 1995 publication on tax expenditures. There is page after page of possibilities that this government, your committee, can recommend on how additional revenue can be generated.

Our proposal on an enhanced child tax credit can be entirely taken care of by closing the loopholes. But that takes political will, political commitment, and delivering on the promises you made in 1994.

Otherwise, all we have in this country are political parties that simply cater to established interests that have powerful voices through the BCNI and other groups. But the people we speak with and for are totally ignored. Then you will have the equivalent of Detroit.

Metro council last night was highly upset with the federal and provincial governments. As far as they're concerned, there is little difference between the two. I hope there is a difference, and that this difference can be translated not only into rhetoric, but also into policies and practices that will finally come to the aid of the poor. That's your obligation, that's your legacy, and that's your calling as a political party.

Mr. Fewchuk: Well, I have a question for you.

Mr. Vandezande: Good.

Mr. Fewchuk: I have a concern about what you said when it comes to Toronto and municipal government as I come from that background. I think back to when I was the reeve of a municipality. I had trouble with Winnipeg; it's something like Toronto, only much smaller.

At the local level I tried to explain to them that it's not the federal or provincial governments. You are one big problem, not because you're large, but because of your thinking.

Come back to the welfare program. According to the rules, we were in charge of our decision-making, our mill rate, and how much money we would put toward these people. Then I said to the aldermen and the mayors of the ``big cities,'' as I called them in the seventies, do you see what you're doing? You are doubling the rates of all of us in Manitoba, and you're going to pay the price.

Fifteen or twenty years later, they are paying the price, because everybody wanted to leave. The aboriginals and people like us from outside and all the communities ran to the big cities. Why? Because the luxury was there. The rates are much higher.

Today the provinces say just a minute, we'll take that away from you; we are now in charge, and we are going to roll back the city by, for example, one or two points, because it is too high, and we cannot afford it.

It wasn't the federal government. It started at the local municipal level, and then it goes to the province to give the money, and the cheque is transferred back to the city and the municipal people. So let's be careful -

Mr. Vandezande: With respect, Mr. Fewchuk -

Mr. Fewchuk: We're all in this together.

Mr. Vandezande: - this is how to do it, in 15 seconds.

Mr. Fewchuk: Okay, I quit.

Mr. Vandezande: The federal government reduced its transfer payments to the provinces. You passed the buck to Queen's Park. Queen's Park then added another buck, and passed it onto the municipalities.

We can't simply pass the buck. We must pick up the challenge and ask how we can together build the kind of social fabric, social cohesion and strong social safety net... Changes may need to be made, but you can't change things by abandoning poor people.

Mr. Fewchuk: That's my point exactly.

The Chairman: Josephine Grey.

Ms Grey: I just wanted to point out that we've had a 72% reduction in welfare for the people of metro Toronto from the federal government. That does have a direct impact, which is not metro council's fault. You now give us the lowest amount for social benefits per capita in Ontario, compared with the rest of the country. That has a very direct, visible impact on everybody.

Metro council is upset because it has ever-increasing homelessness, which is a direct result of a reduction in transfer payments. There is no other reason for it in this case.

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The other reason it is upset is that the federal government, and now the provincial government, has divested itself of all responsibility for housing. I'll tell you, I'm going to be one of those families that is going to have no home. I have four children I have to house. I will have no home when that happens. Once they pull out of social housing, I will have no place to live, and then you can add me to your homeless list. When I come back to this committee next time, you'll find that I have no place to live but a shelter. For the first time in your life as a committee you'll be speaking to a homeless person.

That's the kind of thing that's happening, and it's happening to everybody and anybody. As I said, 45% of the population is vulnerable to unemployment, and 45% of the population is vulnerable now to homelessness, because there's nothing, or very little, left in place.

We have 1,000 empty housing units in Toronto. We have people scared for their lives. We have a right to be upset at you, directly at you.

I was sent to the world seminar on social development. I saw what this government put forward to the international community as the fundamental principles of human justice. I witnessed and observed that.

I know that if you actually followed what you signed, if you followed the United Nations Charter on Human Rights, if you actually lived up to things the way this government used to live up to these kinds of things, we wouldn't have these problems. I find the duplicity and hypocrisy is really hard to take.

I know there are a lot of things that can be done about it. Many different kinds of solutions can be put forward in cooperation with other nations. I recognize that it can't be done in one nation alone, but all these things are possible.

I have seen other heads of state say personally that they were more than willing to start getting some corporate control. They are more than willing to do taxes on financial transfers. They are more than willing to start controlling the financial market, which is nothing more than a big gambling casino, and it's stripping money off of my back and your back.

So it's time to deal with that, but at the same time we have to make sure we're preserving some of the basic components of a stable society. My children don't think there's any point in going to school, because they know they're not going to go to university. They know that no matter how hard I work, I won't be able to pay for it.

So just keep that in mind when you're thinking about -

Mr. Fewchuk: All right, I'm sure glad I brought this subject up, because this is what I like to see. Now we have something going.

My children didn't have the chance to go to university. They're both married, and thank the Lord things are going well.

So I thought we'd better get this ball rolling. I want to hear from you also. Thank you very much. The next witness, please.

Ms Morgenthau: I guess I have a different way of looking at things. My parents lived through the Depression. My children worked their way through school.

The basic thing I think we're missing from the whole thing here is the fact that we all admit there are poor. There are always poor. There have always been poor. There always will be poor. What we have to look at is how to keep them from getting poor.

Let's look at the middle-income person. The middle class is what built this country. They didn't build it, because they were upper middle class, but they were workers. There were none of these programs around when I was growing up. You had to manage on your own, and perhaps responsibility is something that goes with being whatever you are: upper, lower, or poor.

I probably sound terrible to the people who are around this table and know the poor, but I lived through that kind of thing. I know about putting a sack on your back, going out and shovelling, or finding something to do. There was none of this violence that we have now. So somewhere along the line we've lost that entrepreneurship, that ability to go out and to be, and to overcome what you don't have.

We certainly have to look after the poor, but we have to look after the poor in a way to make them come to the point where they're not poor, where they have these jobs, where they find something, where they manage.

As far as $19,000 is concerned, that's... Like I said, in 1950, if my husband earned $20,000 I would have thought he were a millionaire. Well, you can't think in those terms any more. That $19,000 is not going to give you a living. So let's be practical, and stop thinking in terms of all these other things.

I've finished.

The Chairman: Thank you. There are two more people who wanted to respond.

You certainly opened a hornets' nest here, Ron.

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Ms Rothman: With all due respect - and I don't even know who I'm responding to at this point, but I can't help but respond to you - the world of work has changed tremendously. You just don't put a sack on your back, although, interestingly enough, if you go to subway stations around Toronto, you do see entrepreneurial people setting up stalls - I do not even know if they're legal any more - selling fruit and vegetables, probably because there's no other way to manage. You're putting bits and pieces together.

I don't think you can compare the nature of the economic challenges. That's not what I wanted to get into extensively.

I want to go back to what Gerald said, about whether you want to call it standards in some situations, principles, whatever it is, around the social network, the social safety net.

The Liberal government has made extensive - what shall I say - words, noise, about the social union, particularly in the last year. Well, the social union in this country is very much woven of the social safety net and people's perceptions of it.

You'll get the Ekos Research polls, and some of the other more in-depth polls, and not just snapshots, polls where you get attitudes over time every couple of months.

Canadians value social programs, and I guess I would like to say that if the Minister of Finance has a major responsibility to act to support those preferences, I think that like many of us, I am quite angry about the reduced transfers to the provinces. There is no question.

I guess the other thing I want to say is specifically on child care. Child care is an example of what your devolved programs will all look like. It never had standards. It has really evolved hither and yon with money from the Canada Assistance Plan that wasn't ever directly meant for child care. It was meant to alleviate poverty, and that was one appropriate way that could be done.

One thing I want to say that we should take back to the minister and include in your report to the committee is that if you really want to talk about social union, there has to be a serious effort to create principles and, where appropriate, standards for social programs. I think there is a federal role there in conjunction with the provinces.

I know what the council of ministers has said. I have read Tom Courchene's paper. I think there are many problems with it. But I think that as elected Liberals you have a responsibility to review your role and leadership with regard to social programs.

The Chairman: Thanks, Laurel Rothman. And lastly, Jim Mahaffy.

Mr. Mahaffy: I too want to address the issue of standards and principles in terms of an overall approach.

One of the things I think we are really facing today is that some of the principles that have guided the framework of social programs we have today have not changed over a period of time. Instead of reacting, which in a sense is the way most social programs seem to be operating these days, to problems that exist, we need to find ways to be proactive and to go out and make problems disappear before they arise.

In a lot of ways the programs that exist right now for people with developmental disabilities are programs that segregate. They have been built on historical models of treating people with disabilities as a separate category, of keeping them out of society, because that was the way to protect them, and that was the way to help them.

Now we have come to the realization that this kind of program has tremendous economic and social costs that go along with it. What we need now for all people is a new set of standards and principles that act proactively to create a new social network of programs and policies that promote people's participation and integration in society.

We believe that as a result of these kinds of new approaches, the cost of social programs, or the cost of social problems, will decrease. This needs to be a primary activity and focus for the government, not only in its federal role, but in its leadership role in relationship to the provinces in terms of creating a new framework of principles and policies that will guide decision-making around the fiscal matters.

The Chairman: Thank you, Jim Mahaffy.

Gerald Vandezande, I can't offer you the real thing, but only the next best to it. So here, on behalf of the Bloc Québécois and Reform Parties, is Ovid Jackson.

An hon. member: No way!

Voices: Oh, oh!

Mr. Jackson (Bruce - Grey): Thank you very much, Mr. Chairman. I am certainly pleased to be here. The discussion is quite good. It shows you that there are some people with some rage and some problems.

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I think that because of the deficit we find ourselves in a position, and even in our caucus we have these discussions. People want to spend money, but if you were to put yourself in the family that got behind the eight ball, had a whole lot of debt, and you had to restructure what you do, maybe you'd cut up the credit cards, and you'd have to find a way to do things.

Now, what the deficit has forced us to do, along with the restructuring we have, is to rethink the way we do things. That's something we all have to do.

The world of work has changed, and the old approaches will not apply. When we went into a lot of the things that previous governments had done, they really did not prepare the nation for this transition we're going through. We're actually quite fortunate with a lot of the jobs we have. They're certainly not enough, but the governments before did not make the accommodations for this.

There are some benefits from what the government has been doing, and I haven't heard any of those. For example, a lot of provinces have balanced their budgets. The Government of Ontario would save maybe over $1 billion from low interest rates. So there are some benefits from what we're trying to do.

I know that Mr. Martin has been taking some small steps. I'm hearing it's not enough. If we were to look at the last budget speech we had, the RRSP contributions are frozen, and there are many little things that have been done.

Mr. Chairman, I think these are extremely good discussions. I think we have a real mix in the room, and I hope we have enough to carry back to see what steps we can take.

But, you know, we can't change the rules in the middle of the game. The government and the banks probably each have a policy and I'm hearing a lot of different stuff. People say get the Tobin tax, get some other stuff.

When you change the rules in the middle of the game, that causes a whole bunch of disruptions, and you've alluded to that. You've said that there are consequences. for everything you do. I think we can work out a lot of these things.

Yes, young people are extremely important. People are the most important product of a nation, and we have to look after them. We have to look after our aged as well, because if we don't, then we're in really bad shape.

Thank you.

The Chairman: Thank you, Mr. Jackson.

I am very pleased to go to Roy Cullen. He has joined us from the neighbouring riding of Etobicoke North.

Mr. Vandezande: Mr. Chairman, the question was addressed to us.

The Chairman: I'm sorry, is there a question?

Mr. Vandezande: He took issue with what we said, and -

Mr. Jackson: No, I didn't, I tried to comment.

The Chairman: No, I don't think he did at all.

A voice: Oh, oh.

The Chairman: I did not hear a question.

Mr. Jackson: Just a general observation, Mr. Chairman.

The Chairman: Gerald, I've argued with you persistently and constantly about all sorts of things, but about nothing you've said today.

Roy Cullen.

Mr. Cullen (Etobicoke North): Thank you, Mr. Chairman, and thank you, all the presenters, for the good discussion we are having. I'd like to particularly welcome Bill Goursky from the Etobicoke Social Development Council, whose organization does some great work here in Etobicoke.

I'd like to take issue with two of the presenters here who complained about the meeting being in Etobicoke. Jean Augustine and myself think it's a great idea.

Voices: Oh, oh.

Ms Grey: I apologize. It just takes so long to get here on the subway.

Mr. Cullen: Yes, well, I'm sure people like Bill probably would come here, and maybe not go downtown. But I think it broadens it, and allows people from the outlying areas to access it.

Thank you, Mr. Chairman; that was a great idea.

The Chairman: I really agree with Josephine Grey. It was a dumb idea to come out here.

Voices: Oh, oh!

Mr. Cullen: In other words, not next year? Is that it?

Mr. Goursky: What's your licence number?

Voices: Oh, oh.

Mr. Cullen: As we talk about these issues, I'm wondering... I agree that the problems and the challenges are real, but if we put it in context, it seems to me that it's societal issues in general.

When we look at Canada being named by a number of organizations as one of the best places in the world in which to live, and Toronto was recently named as one of the best cities in the world in which to live, if we're objective about it, we need to understand that there are challenges, opportunities and problems, but at times we need to put it in that context.

Having said that, I'd like to talk a bit about your brief, Bill, and I'd also like to get into this intergenerational issue and the seniors issue if we have time.

Bill, on your issue of the Somali refugee women, I think it's really commendable what they're trying to do. I've met with the Somali women in the riding, and the Somali community generally. One of the issues they have, of course, is child care. A lot of the women are looking after six, seven, eight and nine children and they can't really get out to learn the language, which causes integration problems, etc. So child care I think is tied to that.

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I think that we, the federal government, have some responsibilities. I know there is this sort of pass the buck - well, if the provinces would step up to the plate, and Ontario - but I believe it is a real issue. To say that the federal government should take exclusive responsibility in child care... I don't think it is sort of passing the buck to say that. I think the province has to step up to the plate and come in with their social transfers.

I agree with you, social transfers have declined, but really the issue in Ontario, not being partisan, is that one of the problems of the Mike Harris government is not just the expenditure cuts to deal with the social transfer tax reduction, but he is also delivering a 30% tax cut, and he is doing all this in about two or three years.

When we are reducing social transfers by 4% and 5%, we are reducing the machinery of government by 8% or 9%. If we think collectively around this table that the federal government can attack the deficit without hitting transfers to provinces and individuals, I am afraid we are dreaming in technicolour.

Mr. Goldberg: Nobody is saying that.

Mr. Cullen: Excuse me, maybe I can just finish. You've had your say. Is that all right? Okay.

Bill, there are a number of issues there in terms of getting small entrepreneurial businesses moving, which is really in a sense what this is. I had an issue the other day. There is a materials handling institute in Etobicoke and also a number of companies looking for forklift truck operators. It requires three days of training at $750. They brought me this wad of want ads: ``Forklift truck operations, paying $6 to $12 an hour and upwards''.

Anyway, we started working on this. Basically, we are trying to put people who are jobless and are prepared, with some help in many cases, to get a ticket and get a job. The situation you're talking about, the first step is a business plan. I don't know if you know David Reville in the riding, but he and I met the other day. He is actually doing some really good stuff with some minority groups. I have encouraged him to work with me.

For example, an issue many of us are wrestling with is this business of seed capital of small business. If you look at venture capital pools, they typically don't want to touch anything less than $500,000. The administrative cost of doing that doesn't make sense for them. But I encouraged him to appeal to a labour-sponsored venture capital fund. They really aren't using that money very quickly, and I know they have a problem getting it out and using it wisely.

Anyway, there are issues there, and I would be glad to work with you to help put together a business plan. We can talk about this. There are a number of avenues you might want to pursue to help make this happen. But that is sort of a local issue.

In terms of youth crime, I agree with you, it is a problem. There are so many social issues and social policy issues wrapped up in it, to my mind, and it goes right back to a whole bunch of things. It is certainly beyond my area of expertise or beyond the discussion of this group, I think.

In terms of economic issues, I think there are a lot of things we can do in terms of creating opportunities where there is some future for our youth, and how do we do that. I know a number of us in caucus are preoccupied with youth unemployment and creating bridges.

Let me move quickly then to intergenerational issues and CPP. I am going to throw out two questions to the group and I think you can all comment on them.

This business, and we touched on it earlier, of the young person who comes home, can't find a job or maybe he is working at a McDonald's with an undergraduate degree, has to pay more for their university fees, their mother and father, upper-middle-class, are getting senior citizen benefits, free movies or cheap movies, cheap bus fares, etc... Some would say it is mean-spirited, but it may be a reality. I am wondering if you could comment. We touched on it, and maybe we can get into a little more. How do we handle that, how do we deal with that?

In terms of seniors and pensions and old age security, we touched on that a bit as well, but I am wondering... And maybe the Citizens for the Public Justice and others could jump in here too. I get a lot of calls on this from seniors. Some people are just confused. There is some confusion out there. Some people are concerned as to where the old age security and pensions are going. I am wondering when I am talking to them if I am really talking to the more affluent seniors. There is a difference between people who are confused and where we are going with these programs.

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The Chairman: Could I just turn it over to Stephanie Baker Collins, please?

Ms Collins: We are not at all suggesting that we transfer dollars from needy seniors to needy children. And we are not talking about cutting the Canada Pension Plan. Our specific proposal is around the registered retirement savings plan, which is a tax break that primarily benefits... Most of the benefits in that tax expenditure go to wealthier seniors. And the cut-back we are talking about would still give seniors a very adequate $36,000-a-year income. So we are talking an equity kind of redistribution of income, not taking from needy seniors to give to needy children. That is not necessary.

Just to comment too on Mr. Jackson's comment around this not being the time for new spending, we are talking about a reallocation, which is the target you have set for yourself. Our reallocations are going to go to the highest priorities. That is in the fiscal update. That is what we are saying. This is the way for the reallocation to go to the highest priority.

Ms Rothman: I guess I would say with all due respect that I think we are here to talk about the federal government's role and understanding the impact some of the cuts have had on the provinces. We have some other forums to talk about the Harris government at times, for whatever it is worth.

I guess I want to say something in response to Mr. Jackson and further. There are some of us out here who think the federal government has far exceeded its deficit targets. There are even some what we might call traditional economists who are saying you do not have to exceed your targets; you might even let the inflation rate get a little higher; in fact, you might even begin to increase some expenditures for the right investments. I guess that is what some of us are thinking about with regard to investing in children. I want that to be on the table.

Ms Morgenthau: I have a suggestion about marketing. Practically every high school has teachers who teach marketing, who put together plans and would do this, I am sure, if they were asked, would do it well and would do it free. I think that might be something you could look into for your people with plans. It would be free, it would be good, and it would be available.

I have one other thing. We are always talking about the children, which are probably the best things we have. But let us stop talking about wealthy seniors, middle class seniors. They didn't get there because they sat around. They worked for what they have and they are entitled to maintain what they have.

I get very upset when I hear ``wealthy, wealthy, wealthy''. They aren't wealthy. There are tons of seniors who just put away their nickels, their dimes, their dollars and put it aside so they could have a decent older age. That is their money. If you want it, you should ask them for charity. You should not be out there chipping away at what they built.

Mr. Goldberg: I want to get back to the RRSP question. OCSCO also has a position on RRSPs. We think there should be some changes made. We think there should be regulations requiring that the tax-sheltered savings should be invested in Canada and that there should be a reduction in the RRSP exemption level. We think there should be taxation on bonds and stock trading and that type of thing, to be able to increase the government's revenue.

We're all parents and grandparents too, we seniors, and we're concerned about our children and our grandchildren. We don't want to see any of the social benefits we have worked all these years for going down the drain.

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The main items we should be looking at are cutting back on the RSP exemption level and something to generate more tax revenue for the government. Part of our presentation is on taxation. Approximately 63,000 profit-making companies paid no income tax. We think you should be going after that kind of thing. That's where it is.

And create more jobs. We have nothing against low interest rates. That's not an obstacle anyway.

The Chairman: Thanks very much, Mr. Cullen.

Lastly, you have a brief question, Sue.

Ms Whelan: Thank you, Mr. Chairman.

I want to thank Ms Grey for her detailed presentation today, as I'm reading through it.

I want to thank you for your honesty in portraying your own personal experience in it. You've drawn the picture quite clearly that no one plans to be poor and no one wants to find themselves in that situation. Everyone wants the opportunity to be on equal footing and move out of that.

With that, I have two quick questions for you. You mention in here EI and the devastating blow for women, partly because they're part-time. I'm not sure if you're aware that the new EI changes introduced in July force employers now to pay into it for part-timers so they will be eligible. One of the reasons that was brought in was the concern for the vast majority of women who are part-time workers out there.

The other thing is you mentioned that the ceiling for the proposed family supplement based on family income is too low. From the federal perspective, in the income tax - and I don't know if you have had a chance to look at this or not - what could we do to assist people in your situation and others you know of?

Ms Grey: I'd like to answer those and also one other point Mr. Cullen made.

With the EI changes, the problem I'm identifying is it takes more hours to qualify and then the payments that come out at the other end are smaller. So if you're a part-time worker, you're making a very low income, and then you're only receiving 55% or 60% of that income. It's insufficient to cover costs. That's what I meant there.

I understand there have been accommodations for part-timers. As I said, there are some positive things about the program, particularly in relation to allowing some people to develop new initiatives and the like.

What you could do in terms of the ceiling is simply adjust the ceiling according to family size. Also, really it has to be indexed. It absolutely has to be indexed.

The other thing around the child tax benefit is there has to be some kind of provision for people who may be having difficulty filing their taxes. I've been denied a piece of paper that I require in order to be able to file my taxes, so I haven't been able to receive the child benefit for two years. I have less income than I should have.

At any rate, that's just my problem. I get denied those papers because of the kinds of things I say and because I do things such as help organize the days of action.

Mr. Cullen, you were talking about some of the difficulties of investing in small business and the trouble of handling a lot of small loans and the cost of that. There's a financial services review coming up. It's a very important initiative by this government and it has the potential to address some of these issues.

What Mr. Goursky was talking about is a vital thing that's been overlooked and overlooked. Organizations really do have to be given the core funding to have the capacity to work on these kinds of initiatives and get people who are unemployed or changing their fields to start a business that's going to be viable and that's going to last.

Our organization does this. From our perspective, it takes roughly three years to take a group of people and get them to the point where they're actually going to have a sustainable income. These people all have no access to credit, no collateral, nothing. They usually have such bad credit ratings that they'll never get it.

We look at using sweat equity as a way of building collateral. If you can facilitate the financial services industry so some of these things are possible, and if you can facilitate government's ability to respond to the community's agenda around looking at local economic development and building these kinds of businesses, a lot economic activity can be generated.

Part of that is through the financial services review. I do believe you need to have some people with CED expertise on that panel. I believe it's going to be quite an extensive panel that will go for a while. But if you have people who are all simply focused in the business sector or the financial services sector, you'll get nowhere with it.

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It's a very serious issue. As I said, every time those people who are recycling in and out of the workforce come out of the workforce, they also lose their ability to start new economic initiatives. We see this all the time. We see people with unbelievable talents, skills and experience who cannot access that. Yet these are people who could create jobs.

Right now I'm fighting for one person to be able to continue to develop a business that is now at the stage of earning money for the first time. I have to fight so he's not forced into a job search. The man is 56 years old. He's an immigrant. He's not going to get a job; let's face it. However, he's been working on this project for two years, and within a year he will have an income from his own business, along with several other partners in our organization.

You have to look very seriously at the intermediary organizations between financial institutions and the population. I hope you make a recommendation around that in relation to the financial service sector.

A lot of different kinds of things along those lines have been coming out through the United Nations Development Program. In the international forums you guys have been attending, and even in the recommendations you make to the World Food Summit, you talk about a lot of these basic concepts of labour-intensive activity and more labour-intensive agriculture - all of these kinds of things - but you actually have to act on them. You have to facilitate them.

And they're not all cost issues, either. Very often the issue is regulatory approaches that have to be taken.

As I see it, the finance ministry appears to be dictating policy for a great deal of government these days, so that's why I address a lot of things to the finance ministry.

You took away the standards. Recommend that they be put back, because you're losing money.

When you get a municipality to pay for a motel room instead of a social housing unit, all of us are losing money. It doesn't matter what level of government it's being drained from; it's being lost.

It's up to you guys to make sure those standards are put back in and to recognize there's a cost benefit analysis of having a secure foundation.

The other way in which you can get this kind of economic activity to move is to recognize that the major difference between the poor and the middle class is assets. If you don't have any assets, you have nothing to borrow against. If you don't have any assets, you have nothing to think about in terms of your future. If you're a poor person, you can think no further ahead than the next three weeks. Nobody can plan or live a decent life that way.

If you were to start approaching assets instead of just income, you'd find there are lots of things you could do that would save you a lot of money. For example, if you started a small account for every person born in this country and then subsidized the building of it for those who are very poor and allowed for different tax treatment for those socially useful kinds of savings, you would have people paying for their education out of things that accrued over 20 years rather than having it come out of government coffers and then maybe or maybe not getting it back.

You need to look at very different approaches, recognizing that our employment is so unstable now. The job market is unstable. Technology has replaced so many jobs. We have to have a basic level of stability and an ability to look ahead - an ability to plan and work together as people. Without assets, without security, without being able to stay in one community, none of that can happen.

All of these things can be addressed. They're being tested in Oregon, Singapore and other parts of the world. These kinds of asset-based policies are being tested, and they're being found very effective.

I'll give you a quick example. In Singapore there's roughly 95% home ownership. That's going to make a huge difference to the civility of their society, and that's because of an asset-based policy.

I would really recommend that you look at that or get some kind of committee to look into that. That could also dovetail with the financial services review, because those pools of assets can be used to leverage financing for local economic initiatives. People could start making decisions around how they would use and invest a percentage of those socially useful assets. That kind of process would be really important to engage in.

I'm sorry. It's very difficult for me to be very clear today, because some of the things that were said really upset me.

The Chairman: You're very clear.

Thank you, Ms Whelan.

Tony Parker, could I ask you a question? These premium bonds have a pay-out rate of 4.75% today. Is that the going market rate for other bonds of the same nature?

Mr. Parker: No, it's lower.

The Chairman: How much lower would it be, and what would the saving to the government be by issuing these premium bonds as opposed to regular bonds?

Mr. Parker: The government can dictate the interest rate. It's a variable rate. They can declare a 3.5% rate. They obviously would keep within probably two points less than the going interest rate.

The Chairman: So there's a real savings?

Mr. Parker: Yes.

The Chairman: That's a great idea. Thank you. I'd never heard about it; I'm glad you brought it to us.

Mr. Parker: Well, thank you. I was hoping I might get some more questions about it.

The Chairman: Well, it sounds so good, why would anybody want to question you about it?

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Mr. Parker: Everybody feels it's something we should do then, probably.

The Chairman: I would be delighted if you could give the material you have on that to our researchers.

Mr. Parker: Yes, okay.

The Chairman: That would be very helpful to us.

Mr. Parker: I have done a test run with friends. Just about everybody I have spoken to says that this would work.

The Chairman: It would be a lousy payback, but if it saves the government money, let's do it.

Mr. Parker: No, it's not really a lousy payback.

The Chairman: It's a lousy payback, but people buy them, and I don't care.

Mr. Parker: That's good. They buy them where they wouldn't buy lottery tickets.

The Chairman: Sure, yes. I love it. Thank you very much for bringing that to our attention.

Could I ask you, Sandy Prince, whether female genital mutilation is on the rise in Canada? I know it is against the Criminal Code. Has there been an increase in female genital mutilation in Canada over the last couple of years?

Ms Prince: Has it been on the rise?

The Chairman: Yes.

Ms Prince: Well, to be quite honest with you, I can't actually say whether it is on the rise or not. The thing is that it is actually happening to immigrant women mainly from Africa. I can't actually say if it is rising or not.

We want to eradicate it. We want to stop it. It's a form of violence against women. Just to say that it is on the rise, I can't say whether or not that's true.

The Chairman: Okay. It certainly is against the Criminal Code.

Ms Prince: Yes.

The Chairman: But what goes on in various communities behind closed doors often can't be controlled by the police.

Ms Prince: We don't know about it. Exactly.

The Chairman: So it has to be a question of education and dealing with people -

Ms Prince: Exactly. That's why you can't -

The Chairman: - in their own communities who can talk to these people and say that these customs are not only illegal, but they're wrong.

Ms Prince: You've pretty much answered your question about whether it is on the rise, because again, it is happening behind closed doors and you cannot give a number to that.

The Chairman: No, no. It's just so much against the standards we believe in.

I was going to suggest that I'll give anybody who wants it 15 seconds maximum to sum up.

We will start with you, Mr. Woeller or Jim Mahaffy.

Ms Rykert: I'll take 15 seconds maximum.

The Chairman: You've been so quiet today, but so forceful. Okay.

Ms Rykert: I recognize the value of this discussion. I think it was very helpful.

I want to just leave you with a thought. Some of the work we are doing is linked very closely with a lot of the efforts that have been talked about today. Some opportunities have been created in communities in building local skills and involvement.

I wanted to say that in terms of the investment, we really need to rethink that. I wanted to make a point about what Mr. Ovid Jackson was saying. We shouldn't stop things part-way. I would suggest that you've done that to these programs, and I would like to call him on that.

Ms Rothman: Keep your red book promise on child care. There is still time. We want to see it in this budget. We want to see evidence of action and spending.

Ms Grey: I have a letter from a businessman in Cabbagetown. I guess I can't read it, but I'll give it to you. He is saying that his business is declining because of the cuts that have happened to the community. He is very upset about it. He has never had a political opinion in his life, but he heard that I was coming here. He hastily wrote this and gave it to me. I thought I would give it to you because this is your average business owner on the street. He is among the many people I found in Toronto who are, for the first time in their lives, becoming very political.

Another thing you need to be aware of is that if we don't start to turn the ship around and really seriously address some of the deficits that have been created in the last few years around our social fabric, you are going to see social unrest. I can guarantee it. We have to control it this time around. I don't know if we can control it the next time around.

Mr. Vandezande: I have one item, Mr. Chairman. It is listed in our recommendations that deal with foreign aid.

Mr. Chrétien is sending his nephew to Zaire with the sponsorship of the UN. Clearly, that is one of the most depressing scenes we see on television every night. My hope, and CPJ's hope, is that we don't cut Mr. Chrétien's access to adequate resources so that Canada can play its role. We should keep the red book promise, bring foreign aid back to 0.7% of the GNP, and demonstrate it in the next budget.

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Ms Baker Collins: I would just repeat for emphasis that there is a specific thing you can do in this budget. You can bring in an integrated child tax benefit. It will need some new dollars. You can find that by looking at tax expenditures that benefit the wealthy.

Mr. Parker: I didn't realize this was a political battleground. I don't have any ammunition with me.

Mr. Vandezande: You don't need ammunition; you just need rubber boots and a raincoat.

Mr. Parker: I hear Mr. Vandezande loud and clear. When two or more people are gathered together, it's a good time for political discussion.

Mr. Woeller: The elimination of the capital gains tax on gifts of appreciated property would help the charities.

Mr. Mahaffy: I would just like to particularly ask the committee to pay attention to the recommendations made by the national task force on disability, particularly around tax issues.

The Chairman: Mr. Woeller, we recommended the exemption last year. With your help and that of other people, we will be pushing even harder for greater tax incentives for donations to charities in the voluntary sector. So many of you people out there are in that area. We think that since we have been cutting back, we have to give you the tools to do it better.

Mr. Mahaffy, we have heard from right across Canada from people who have responded to the Andy Scott task force on behalf of the disabled. It is time for action. The recommendations are very hard-hitting, but very appropriate. Thank you for adding your voice to that. We look on it very favourably.

Liz Rykert, again, across Canada, we have heard how we have cut the CAPC program and how it was such a good program in terms of mobilizing community-based support for these wonderful programs. Thank you.

Laurel Rothman, this is not our first meeting, and I hope it's not our last. You have a brilliant suggestion. You are simply saying, most unreasonably, that the red book promises should be kept. And you found a way to overcome the one barrier to us keeping it. So I think you are most unreasonable.

Josephine Grey, Stephanie Baker Collins and Gerald Vandezande have made a very strong plea for an enhanced child tax benefit as being the simply the single best way of getting to the issue of child poverty. This is one of the themes we have heard a great deal about, and it was certainly emphasized by you people today.

I have had Gerald Vandezande in front of me before talking on behalf of the senior citizens. I heard him and Stephanie Baker Collins talking today on behalf of children in poverty in Canada, and I commend you for drawing our attention to these very important things.

Hank Goldberg, you talked about a number of things on behalf of Canada's seniors, as did Lillian Morgenthau, including the CPP and RRSP changes. It seemed to me that the most important case you made to us was to not sacrifice the Canada Health Act and the national standards attached to it.

Tony Parker, thanks for a novel idea that could save us some tax money and give us some more money to direct to the things that are really important to us.

This is our last meeting on the road. We have half of our committee here. We divided it in half. Half of it did Ontario and the four provinces to the west, while half of it did Quebec and the four provinces to the east. We met back here today. Our vice-chair, Sue, owns half of it.

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This is an incredible effort in logistics on behalf of our committee staff. There was our clerk and the people who worked with her, such as our translators and technicians, who put everything into the two official languages. These people made sure we had meeting places and everything else.

On behalf of all members of Parliament, I want to give our staff an incredible hand for what is an almost impossible task. You've done it extremely well. Martine, to you and everybody else, thank you very much.

Voices: Hear, hear!

The Chairman: To you people who have come out and spent your time and your expertise in bringing your major concerns to us, I thank you very much. I appreciate it.

The meeting is adjourned.

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