Mr. Speaker, I am thankful for this opportunity to introduce Bill at second reading. Today's legislation builds on the strong foundation that was laid last year. We are continuing to build on our portfolio of initiatives we have introduced since 2006, with affordable measures to create jobs, promote growth and support long-term prosperity.
This key strategy is working, creating jobs, keeping the economy growing and returning to balanced budgets in 2015. Since we introduced the economic action plan to respond to the global recession, our economy has created nearly 1.2 million net new jobs since the depths of the recession in 2009, one of the strongest job creation records in the G7.
I would be remiss if I did not tout some of the outcomes of our economic action plan.
According to KPMG, total business tax costs in Canada are the lowest in the G7 and 46% lower than those in the United States. When was the last time that happened? What is more, Canada leapt from sixth to second place in Bloomberg's ranking of the most attractive destinations to do business in the world.
Both the IMF and the OECD still expect Canada to be among the strongest-growing economies in the G7 over this year and next.
For the seventh year in a row, the World Economic Forum rated Canada's banking system the soundest in the world.
All the major credit rating agencies accord Canada a top AAA rating with a stable outlook, a rating shared by very few countries.
A recent New York Times study found that after tax, middle-class incomes in Canada were substantially behind in 2000 and now appeared to be higher than those in the United States. In fact, the Canadian middle class is among the richest in the developed world for the first time ever.
The federal tax burden is at its lowest level in over 50 years, and remember we have removed more than one million low-income Canadians from the tax rolls entirely. The average family of four will save nearly $3,400 this year and a small business earning $500,000 now saves over $28,000 in taxes, thanks to our low-tax plan.
It is clear that Canada has become an international success story, but Canada is still not immune to the global economic challenges beyond our borders. Our government has been adamant that as long as Canadians are still looking for jobs, there is more work to be done.
With that, let me now turn to the measures in today's legislation that would build on our success and ensure that we would continue to keep Canada on track for job creation and balanced budgets.
First, Bill reaffirms this government's commitment to making our tax system simpler and fairer. It also closes tax loopholes and strengthens tax enforcement to ensure low taxes for all taxpayers, not only a select few.
Allow me to highlight some of the measures we have taken to improve the fairness and integrity of the tax system.
First, today's legislation would simplify the tax rules relating to the lifetime capital gains exemption, LCGE, and the intergenerational rollover for taxpayers who carry on farming and fishing businesses in combination. This builds on our original measure to increase the potential rewards of investing in small business, farming and fishing.
Economic action plan 2013 increased the LCGE from $750,000 to $800,000 in 2014. To ensure that real value is not eroded over time, we also indexed the $800,000 limit to inflation for the first time ever. The first indexation adjustment will occur for the 2015 taxation year. To accomplish this, the government proposes to generally treat a taxpayer's combined farming and fishing business the same as separate farming and fishing businesses conducted by the same taxpayer. This would ensure consistent treatment for taxpayers who conducted farming and fishing activities in different legal forms.
Similarly, a special income tax rule is currently available to farmers who dispose of breeding livestock due to drought or excess moisture conditions existing in specific regions in a given year. This rule permits farmers to exclude up to 90% of the sale proceeds from their taxable income until the year following the sale or a later year if the conditions persist.
Bill proposes to extend this tax deferral to beekeepers and horse breeders, effective for 2014 and subsequent taxation years. These are two examples of our Conservative government standing up for the interests of Canadian farmers, fishers, and others who own and operate businesses in Canada.
As I mentioned, our government takes tax evasion seriously, and we want to close loopholes to ensure that all taxpayers are paying their fair share. Bill would tackle tax loopholes head-on.
It is vital that the government have the ability to obtain tax information from other jurisdictions through revised tax treaties and through tax information exchange agreements with non-treaty countries. Current, reliable information is key to our government's efforts to verify compliance with Canadian laws and to reduce opportunities for abuse. Bill would take another important step in this direction by adjusting the policy encouraging the exchange of information for tax purposes.
Specifically, the definition of “non-qualifying country” in the Income Tax Act is relevant in determining the foreign accrual property income of a foreign affiliate of a taxpayer for a year. Today's legislation in that regard proposes two changes. First, it proposes to amend the definition of “non-qualifying country” so that it does not apply to those jurisdictions for which the convention on mutual administrative assistance in tax matters is in force and in effect. Second, it proposes to ensure that the FAPI rules do not apply inappropriately with respect to the British overseas territory the British Virgin Islands, a jurisdiction that now has a comprehensive tax information agreement with Canada.
Our Conservative government has also consistently demonstrated that it recognizes the importance of a strong financial sector. Bill would be no different. Our government is moving forward with its dual agenda with respect to credit unions, ensuring that the regulatory framework is clear and supporting those provincial credit unions that want to be federally regulated.
Since the financial crisis, we have pursued an important agenda of regulatory reform to ensure that the federal financial system is stable and competitive and serves the needs of various participants. Stability has been the dominant theme of the federal reform agenda.
Bill would deliver on the announcement made in economic action plan 2014 about withdrawing the Office of the Superintendent of Financial Institutions' supervision of provincial credit union centrals and clarifying access to federal intervention tools for provincial credit union centrals, credit unions, and caisses populaires.
As many hon. members appreciate, Canada's credit unions are a valuable source of financial services in communities across the country, including in my area of North Vancouver. We want to promote the continued growth and competition of the credit union sector on a national scale.
In recognition of the important role credit unions play, our government created in economic action plan 2010 a new legislative framework for federal credit unions as a platform to broaden choices for consumers and to improve services for existing members. To continue to grow, some credit unions are looking to amalgamate with credit unions in other provinces to become a federal credit union.
In economic action plan 2014, the federal government also announced streamlining the process of amalgamating provincial credit unions, continuing into the federal credit framework, to make it less costly and complex. Bill would deliver on that announcement.
Yes, there is more. As we have said many times, we understand that the main priority of Canadians is jobs. Let me highlight three measures that are helping small businesses and ensuring that Canadians are first in line for jobs.
Bill would implement our recently announced small business job credit, which would save small employers more than $550 million over 2015 and 2016. It would also lower EI payroll taxes by 15%. This is real money that a small business could use to help defray the cost of hiring new workers and to take advantage of emerging economic opportunities supporting growth and job creation.
We have listened to the experts on small business. For example, the Canadian Federation of Independent Business estimates that our small business job credit would create 25,000 person years of employment over the next few years.
Monique Moreau, of the CFIB, said, “small businesses in Canada should be thrilled with this announcement...because they told us time and time again that payroll taxes like EI are the biggest disincentive to hiring.”
Our Conservative government recognizes the fundamental importance of small businesses in fuelling the Canadian economy, so while the opposition insists on attacking job creators with massive tax hikes, we will continue to lower payroll taxes for 90% of businesses to support some of Canada's most important job creators.
However, that is not all. Today's legislation would build on our support for small businesses and entrepreneurs by reducing barriers to the international and domestic flow of goods and services. This measure in today's legislation would promote job creation and would improve the conditions of business investment.
Currently, Canada's framework for protecting intellectual property is not aligned with international practices, creating unnecessary costs for innovative businesses. Harmonizing Canada's intellectual property regime with international norms would help improve Canada's innovative businesses' access to international markets, lower costs, and draw foreign investment to Canada by reducing the regulatory burden and red tape faced by businesses. Economic action plan 2014 proposes to modernize Canada's intellectual property framework by ratifying or acceding to the following widely recognized international treaties: the Madrid protocol, the Singapore treaty, the Nice agreement, the patent law treaty, and the Hague agreement.
Bill would complete the required legislative amendments to the Patent Act, the Trade-marks Act, and the Industrial Design Act to align Canada's intellectual property framework with international practices. The benefits expected for Canadian businesses from these reforms are significant. For example, accession to the trademark treaties would make it possible for a company to obtain protection for trademarks in a number of countries through a single international application, filed in one language and in one currency with the International Bureau of the World Intellectual Property Organization, thus cutting red tape and reducing paperwork and business costs.
Finally, we are implementing certain reforms to the temporary foreign worker program. Our message to employers has been clear and unequivocal: Canadians must always be first in line for available jobs. Our comprehensive and balanced reforms would restore the temporary foreign worker program to its original purpose as a short-term, last resort for employers when there are no qualified Canadians to fill available jobs.
Make no mistake about it, through these amendments in Bill , we are making a comprehensive and balanced overhaul of the program. This clearly contrasts with the Liberals and the New Democrats, who have been completely incoherent about where they stand. While inundating our government with requests for foreign workers for their individual ridings, they are voting in favour of an expansive moratorium on the program. While they are demanding change to the program, they have voted against all our previous reforms to tighten access to the program and to crack down on abuse. These reforms would require that employers make greater efforts to recruit and train Canadians for jobs through initiatives like the Canada job grant.
Some of our temporary foreign worker program reforms include the following:
Employers seeking to hire high-wage TFWs would now be required to submit transition plans showing how they will be hiring more Canadians.
A new enhanced job-matching service would allow Canadians to apply directly, through the Canada job bank, for jobs that match their skills and experience. It would provide information to program officers reviewing an employer's labour market opinion impact assessment application on how many qualified Canadians have applied for specific jobs, meaning more and better labour market information.
There would be stronger enforcement and tougher penalties for abuse of the program through the expansion of the ability to publicly blacklist employers who have been suspended and are under investigation and those who have had an LMIA revoked and are banned from using the program. There would be improved information-sharing among departments and agencies involved in the oversight of the TFWP, including in provincial and territorial governments.
At the end of the day, this program should accomplish exactly what the name says. It would only be used to provide temporary help where clear and acute labour shortages exist and Canadians are not available.
Our government will always stand up for connecting Canadians with available jobs, and these measures allow us to do just that.
I could talk all day about the positive measures in the bill, so let me list a few more before my time runs out.
We are supporting families by doubling the children's fitness tax credit to $1,000 and making it refundable. As we promised in our 2013 Speech from the Throne, we are ending the pay-to-pay billing practices of telecommunication service providers whereby subscribers are charged to receive bills in paper form. We are creating a national DNA-based missing persons index to assist law enforcement in investigations and to help bring closure to the families of missing persons through DNA matching. We are reducing the administrative burden on charities by allowing them to use modern electronic tools to raise funds. The list goes on.
While these measures are a sign of excellent progress, again, our work is not done. Our government will continue to ensure that our tax system is fair for everyone. We will continue to close loopholes, address aggressive tax planning, clarify tax rules, and crack down on international tax evasion and avoidance. In doing so, our government will also build on the responsible management that has kept taxes low for Canadian families and has kept Canada's net debt burden the lowest, by far, among the Group of Seven countries.
For those reasons, and many other measures in today's legislation that I have not mentioned, I urge all hon. members to accord the bill their full support.
Mr. Speaker, I am trying to find a way to say that it is a pleasure to speak to this particular piece of legislation but it is not, simply because of what we have in front of us. The story that is best told about this mammoth bill, Bill , is the story of the good, the bad and the ugly.
Let me start with the good because it is the shortest section. In here, we have the government seeking to go halfway with respect to some consumer protection. New Democrats have been fighting for years to protect consumers from businesses that operate in hat we believe is an unethical way. We think that is the proper role of government. The Conservatives agreed in part.
Pay to pay, a term that was coined in an NDP office in Toronto, is a concept that Canadians should not have to pay to receive their bills. It is adding a little insult to injury. The Conservatives said, yes, certainly with the telecommunications companies, with which they have a particular fight, and certainly for some of the broadcasting companies, with which they also have a dispute right now. Those will be banned. Pay to pay will not be allowed there by law. However, the banks are a special case for the Conservatives and the . It seem the banks do not earn enough money to have to do away with this unfair practice to their customers, so banking consumers will continue to pay to receive their own bills in the mail.
A second piece that is a good and important piece, which has nothing to do with the budget but here it is in the budget bill, is the establishment of a DNA bank for missing and in some cases murdered Canadians. This is also something the NDP has long believed in, after listening to victims groups and police associations that said this was important. We are happy to see progress there.
Now let us move to the bad, because in the 460 pages that are in this massive bill, most of it is bad. Certainly at the very best it is completely unassociated to anything that we would know as a budget. There are 460 pages with 401 clauses changing dozens of laws in the stroke of a pen. When we vote on the bill it will be a six- to seven-minute process and all of a sudden all of these laws, as has been the case before, will be changed all at once.
What is remarkable about this failed process from the Conservatives is that in this massive omnibus bill are a number of changes to fix mistakes in the last omnibus bill, which fixed mistakes from the previous omnibus bill. If the Conservatives consider this competent governance I would hate to see what they think is incompetent because all this does is make up for the arrogant mistakes that get made time and time again by the government. It says rather than debate any of these individual pieces of legislation, among the dozens, at separate times so that we could hear from witnesses who know what they are talking about and so that MPs could vote freely and fairly with their conscience on each aspect, the Conservatives do this kitchen sink approach.
It is a Trojan horse. Buried within the bill are so many concepts, and some of them at odds with each other, that when we had the briefing last night with government officials they needed to roll in dozens and dozens of civil servants to address all the different parts of Canadian law that would be changed by the bill. I had a great deal of sympathy for these folks. They drag them in here and we sit until eleven, twelve, one o'clock in the morning for these things. The officials get up to the front of the room for their six minutes to address one section out of this massive bill and then go home. I am sure they are salaried and not getting overtime for this hassle the government continues to put them through.
The mistakes that continue to be made by doing legislation by bulldozer is a problem for the government. It is a problem for the Canadian people. My colleague just read a quote from the right hon. from when Conservatives used to occupy these benches. We have quotes from the , the and virtually every senior Conservative in cabinet who was at one point in opposition and hated this process when the Liberals did it.
When the Liberals used omnibus bills to ram through legislation, the Conservatives talked about the conscience of Parliament, the inability of MPs to represent their constituents properly and fairly and how this was an abuse of the democratic process.
We agreed with them when they had that conscience. Now, it is the same old story because they picked up some of the worst habits from my Liberal colleagues, and these omnibus bills have grown massively over time. Now we have hundreds and hundreds of pages of legislation being rammed through Parliament with little oversight, affecting virtually hundreds of Canadian laws. They are changing everything from the nuclear act to public safety and Canada's medical act. It goes on and on.
However, what is not in the bill is important. What is in a bill is sometimes very critical. What is not in this so-called budget implement bill is greatly worrisome for me and I believe for the Canadian economy. Taken in the current context, with virtually no private sector growth at all over the last 18 months, the private sector is not creating jobs. We have personal debt rates in this country that are the highest in our history, dramatically higher than any generation has seen before.
We have youth unemployment that is twice the national average and persists from the worst moments of the recession. For young people getting into the economy, getting that first job, which we know is critical for them to become productive and effective members of society, that first job is the most important step.
Youth, as they are coming out of school, training and university, if they are not able to find work, the statistics consistently show us that they will find whatever work they possibly can, and it is usually not in the field for which they trained.
We say we have a skills shortage in this country and in parts of this country we do. However, what we desperately have is an experience shortage. Young people are not getting the apprenticeships, not getting the training and not getting into the jobs for which they were educated.
When we have a youth unemployment rate nearing 14%, and that is not capturing the full rate of unemployment, that should be a problem for any government. This persists. This lasts longer than that one single year. We have also seen 1.3 million Canadians who are unemployed.
I am reminded by the sounds coming from the gallery of something else that is not in this bill. There is no affordable child care in this bill. We know statistically, because we now have evidence from Quebec, and it is proposed by the NDP, that affordable child care is one of the best things that can be done for the economy, never mind for families, never mind for single moms looking for options, and never mind for those families that are struggling to just pay the bills.
When considering having kids, one of the largest factors that comes into play is whether a family can afford it or not. We hear of daycare rates of $2,100 per child per month in places like Vancouver and Toronto. What single mom can afford that? What couple can afford that? We see rents and the cost of living continually going up.
We have suggested to the government that this is an ideal opportunity to increase women's participation in the workforce, as has been evidenced in Quebec, and to increase the fertility rate of this country. As we know, we have a stalled and declining fertility rate or replacement rate in this country. We have seen a baby boom in Quebec.
I thought Conservatives were focused on family and interested in what happens with family affairs. I guess not so much when it comes to actually providing help for those families.
We have seen the loss of 400,000 good-paying manufacturing jobs just since the Conservatives have taken power that have not come back. According to the Canadian Manufacturers and Exporters Association, 700,000 manufacturing jobs have been lost in the last decade that have not been replaced. The trend is continuing.
There are actual aspects of this bill that we believe offer less scrutiny for foreign takeovers of Canadian companies, a back door process, to allow even less oversight of foreign companies taking over Canadian assets. We know the experience. We have the list of promises made when Canadian firms are taken over. The government just does not even bat an eye. It is a problem for Canadians and it should be a problem for the government.
We see, from the Toronto-Dominion Bank, the serious concern of long-term unemployment. We see time and again that if long-term unemployment persists, it has a huge and important effect on our economy, and there is nothing in here.
We heard from those same lobby groups the Conservatives like to quote all the time, the Canadian Chamber of Commerce, the Canadian Federation of Independent Business, and average ordinary everyday people who have businesses. They say that merchant fees, credit card fees, are too high, and that the influx of new credit cards that consumers enjoy is hurting those small and medium-sized businesses.
From Restaurants Canada, we heard that the profit made by restaurants on certain meals, if paid for by certain credit cards, is less than the fees they have to pay to the credit card company. They have to pay fees on the tips that are given to their employees and it comes directly out of the owner's pocket.
If the Conservatives were actually interested in doing something to help small businesses, this would be a good place to start. It hits them and helps them right in the bottom line right away.
However, these are two competing interests. Let us see who wins out, the small businesses of Canada or the large banks and credit card companies. Looking through these 460 pages, the banks and credit card companies win yet again, as they did under the previous Liberal regime.
Let us get into some of the other global concerns. We see a weakening in China. The EU is in trouble again. Paying $80 for a barrel of oil should be a concern as the Alberta government is now publicly saying that its budget estimates were based on $93 a barrel. We are asking the government what its estimates are based on because we know how critical the price of oil is as it relates to how much revenue the federal government is able to receive. As one economist said to the finance committee, if oil stays at or below $80 a barrel and we are losing upward of $4 billion a year, there is no accounting for that at all.
There is no Conservative budget here. Very expensive promises are about to be made, like income splitting, that will cost the taxpayer upward of $5 billion just as we remain in a flat and fragile Canadian economy with very little private sector job growth, with a global economy that remains uncertain and with oil prices that have dropped off dramatically. The Conservatives do not seem to acknowledge any of this and yet they call themselves managers of the economy. How could that possibly be?
Let us look at the one job scheme that the government has placed in this legislation. I say scheme purposely because there is nothing else to call this thing. We asked officials last night to give us the evidence that supports any of the claims that the makes. One would think that if the finance minister and his department had run the numbers and found that the government's half a billion dollar employment scheme would create a lot of jobs in Canada, they would be more than happy to produce the numbers and give us the evidence. They told us that was all advice to the minister and it was protected by confidentiality.
As if ripping off the employment insurance scheme for $550 million was not the business of the people who paid into it, the employers and employees. As if slipping a bit of advice to the minister was somehow to protect those people from knowing what was happening to the employment insurance fund they paid into.
It is not the government's money. The Conservative member from Toronto who sits on the finance committee said that very thing just this week to a witness. This is not the government's money. Why does the government, as previous Liberal governments, treat it otherwise, as some sort of slush fund that it can use for its pet projects?
The only true analysis we have seen of this scheme so far has been from the Parliamentary Budget Officer, who has a good record when it comes to analyzing Conservative costs. We remember the whole Afghanistan cost, which the Conservatives denied.
The Parliamentary Budget Officer has to routinely go to court just to get data from the government, which is ironic and tragic considering it was the Conservatives who created the position of Parliamentary Budget Officer in the first place. He spends half his time in court trying to drag the numbers and the data from the government, so that he can do what he was mandated to do. Why spend the money on this office? Why create the office through legislation in the first place if it is going to be starved of information and denied its right to do its honest and good work?
The PBO did study this employment insurance scheme and found a couple of extremely worrisome discrepancies. One is the perverse incentive regarding employers that sit right around the threshold line as designed in this plan, that are just above the EI contributions of $15,000. They would have a $2,200 incentive to drop below that line. How do they drop below that line? They will have to fire somebody. They would have a $200 incentive to hire somebody that might put them above the line.
Let me do the quick math for my Conservative colleagues: a $200 incentive to hire somebody and a $2,200 incentive for those same small and medium-sized businesses to fire somebody. We hope they will not do that. Most small and medium-sized business owners have a good conscience and want to help create jobs. Why, for heaven's sake, would a government create a program that would give them the incentive to do the opposite while taking from the EI fund to do it?
The Parliamentary Budget Officer also ran the numbers on this and found that the $550 million scheme would create upward of 800 jobs. Wow. That is $550 million in employment insurance contributions out, 800 jobs into the economy. When that number is broken down, as the Parliamentary Budget Officer did publicly and transparently for everyone, that works out to $550,000 for every new job created.
I have emails sitting in my inbox and posted on my Facebook page from Canadians saying they want one of those jobs. They want to know how to apply for one of these fancy EI scheme jobs if they are going to be given half a billion dollars. My goodness. Who came up with this thing?
How bad could it possibly be for the Conservatives that they have to grab and desperately search for job creation plans that cost half a million dollars or more per job? My gosh, they have to do better than this. I guess 8, 9, 10 years in, they have completely run out of ideas.
As Churchill once said about anything he would like to change about all his time in government, he said, “Circumstance”. He wished that he could have changed the circumstance.
However, the circumstance and reality for the current Conservative government is that our economy continues to struggle from the depths of the recession. The Conservatives cannot have 18 months of virtually no private sector job growth and be satisfied as a government. How can that possibly be true? I would love for the Conservatives to get up and deny that reality. Where does that number come from? It comes from Statistics Canada, the government's own reporting agency.
Let us look at another aspect of this so-called budget bill. Refugee claimants are clearly a concern of the government because it has to crack down on the billions of dollars going to refugees. Oh wait, the changes the Conservatives would make do not affect the federal treasury at all.
What would the changes do? They would affect real people's lives, and those claiming and seeking refugee asylum status in Canada will be denied, through the provinces, which would be enabled by the the bill before us, to receive social assistance.
This is coming after the most recent experience of the Conservative government denying refugees medical service and protection, which a Federal Court judge said was cruel and unusual punishment. Members do not have to take my word for it, they can listen to the judge who, when faced with this case, this absolute atrocity of legislation and policy coming from the government, said that any government that does this to anybody is performing something that is cruel and unusual.
Rather than back up that particular train, the Conservatives decided to double down and say that clearly the refugee claimants are making so much money and living so well that we need to deny them, and we will help the provinces deny them.
We then asked, “Which provinces asked for this measure? Which refugee claimant groups asked for this?” The best we got from the government was that it notified the Ontario government of the changes.
Would members like to know what the Ontario government's official policy is on denying refugee claimants social assistance? It is against it. Therefore, the one province the Conservatives even mentioned this to said not to do it, but here we have it.
The Conservatives, on some ideological rant, some xenophobic policy, meant to attack some perceived enemy, some problem that does not exist. They say that their government cares about people. How dare they. How shameful for them to put this in the middle of an omnibus bill and say that it is about the economy.
The Conservatives go to Canadians and say that they are working for them, yet the first thing they are going to do is go after those refugee claimants because obviously people who are seeking refugee status in Canada have been living so well and have had such a good experience in life that they have decided to seek refugee status here.
Where is that compassionate conservatism? Where are those Canadian values that say we are a place that welcomes the world as we have welcomed millions over the years? This strikes at the very core of our values and the Conservative have gotten it wrong.
What possible solutions do the Conservatives have?
Well, let us start with one of them. The , in a rare appearance at the UN, did not talk about climate change or activities of peace around the world, but about his program on maternal health, which is a good and decent program. He said that an important thing about the program is that the government is going to measure it because “You can’t manage what you can’t measure.”
Well, guess what? We do not have good statistics to measure what is going on in the labour force in Canada. The Conservatives have denied gathering census data, which all the economists, banks and credit unions say is an atrocity and a bad way to run a government.
This is a story of the good, the bad and the ugly. It is a story of a government that has absolutely gotten it wrong yet again. It is a failed opportunity to actually help Canadians and our economy.
I move, seconded by the member for :
|| That the motion be amended by deleting all the words after the word “That” and substituting the following:
|| this House decline to give second reading to Bill C-43, A second Act to implement certain provisions of the budget tabled in Parliament on February 11, 2014 and other measures, because it:
||a) amends dozens of unrelated Acts without adequate parliamentary debate and oversight;
||b) fails to address persistent unemployment and sluggish economic growth;
||c) aims to strip refugee claimants of access to social assistance to meet their basic needs;
||d) imposes a poorly designed job credit that will create few, if any, jobs while depleting Employment Insurance Funds; and
||e) breaks the government's promises to protect small businesses from merchant fees and to ban banks from charging pay-to-pay fees.
Mr. Speaker, I rise this afternoon to speak to the latest Conservative omnibus bill. This bill is a product of a tired, old Conservative government that has lost touch with the challenges and opportunities of Canadians.
Bill C-43 is overflowing with changes that have no place in a budget bill, such as the petty change the Conservatives want to make to deny refugee claimants access to social assistance.
The Conservatives are actually using Bill in an effort to deny income support to refugee claimants, right after their attempt to limit refugee claimants' access to health care was struck down by the Federal Court. The court called that Conservative policy “cruel and unusual treatment” that “outrages (Canadians') standards of decency.”
A recent editorial in The Globe and Mail called this bill “an abuse of process and shown contempt for Parliament by subverting its role”. The Globe is right. It is anti-democratic for the Conservatives to once again use a massive omnibus budget bill to limit debate and ram through so many unrelated measures in Parliament.
In the last few years, the Conservatives have concocted and implemented a process that prevents MPs from all parties from doing their jobs in properly scrutinizing legislation. This is leading to a lot of sloppy mistakes. The Conservatives' general disdain for Canada's democratic institutions and their outright contempt for Parliament have led to countless errors being cemented into Canadian law.
This bill would try to fix a number of previous Conservative mistakes. I would like to give members a few examples of areas where the Conservatives are trying to use this omnibus bill to fix errors in previous bills.
First, the Conservatives forgot to include a tax credit in the last omnibus budget bill, Bill , for interest paid on Canada apprentice loans. The Conservatives try to fix that in clause 35 of Bill .
The second is that the government forgot to ensure that PRPPs are subject to similar GST treatment as RRSPs. The fix for that is found in part 2 of Bill C-43.
Third, they forgot to include a refund in Bill for duties paid on destroyed tobacco products. That correction is in Bill , part 3.
Fourth, they forgot to change a legal heading when the Conservatives used Bill to transfer spending powers from the to the . The Conservatives gave all of the powers in that section of the law to the immigration minister, but still named the section “Minister of Foreign Affairs”.
Fifth, they forgot in Bill to allow the to publicly disclose certain information regarding the review process.
Sixth, they forgot in Bill to include foreign money services businesses as foreign entities under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.
Seventh, they ignored expert advice and capped the size of the Social Security Tribunal in Bill , leading to massive backlogs in the system.
Eighth, they failed to realize in Bill that the amalgamation of the Blue Water Bridge Authority might not go as planned.
Ninth, they created confusion in Bill with various amendments related to public service labour, including a reference to the wrong clause number.
Tenth, they forgot in Bill to coordinate between RCMP pension rule changes in Bill and rule changes that raised the age for public service pensions in Bill C-45.
There are 10 examples of the the mistakes the Conservatives made in the previous bill that they are trying to fix in this omnibus bill.
The fact is that the Conservatives' game plan of limiting debate and ramming these bills through Parliaments is responsible for creating these mistakes. Parliament is denied its legitimate role to identify these flaws in the process of real parliamentary debate at committee and in the House and fixing them.
The reason these mistakes are made in the first place is because of the deeply flawed process surrounding omnibus legislation.
I would like to talk a bit today about tax policy, GST, EI, and the income-splitting proposal that the Conservatives had in their last platform.
Bill actually adds GST to some goods and services that are used by or provided by non-profit organizations operating health care facilities. When we asked officials for an example of what kinds of service might get caught up in this GST hike, the example they provided was of a health care facility that also runs a residential apartment building, such as an old age home. Adding GST to services purchased by or provided by old age homes means one of two things: either it will cut into the bottom line of the health care facility, or the old age home will have no choice but to pass the tax hike on to the people they serve. In the case of an old age home, it means that the government is getting ready to hike the GST and punish Canadian seniors, who are already struggling to get by on a fixed income.
In terms of employment insurance, Bill also gets it wrong. Bill offers a small EI tax cut to employers, but only if they agree to stay small. Instead of creating real jobs and growth, Bill would actually encourage businesses to stay small and would punish them if they grow and become more successful. Due to a design flaw in Bill C-43, the so-called small business job credit creates an incentive for some businesses to fire workers. That is why economist Jack Mintz has called it “a disincentive to growth” and why economist Mike Moffatt said “...the proposed ‘Small Business Job Credit’ has major structural flaws that, in many cases, give firms an incentive to fire workers and cut salaries.”
Even Finance Canada officials last night acknowledged that this tax credit creates a disincentive for some employers to hire.
Last month the PBO looked at this tax credit and found that it will only create 800 jobs over the next two years, at a cost of $550 million. That means it will cost taxpayers almost $700,000 per job.
In response to the need to encourage businesses to hire and to reduce EI premiums for businesses that do that or reward businesses that hire, the Liberals have proposed an EI holiday for new hires. This plan would only reward businesses that actually create jobs. The Liberal plan has been endorsed by Canadian job creators, including the Canadian Manufacturers & Exporters, which has said that the Liberal plan for an EI exemption for new hires “would create jobs”. The Restaurants Canada organization, representing restaurants across the country, said “This...proposal for an EI exemption for new hires would help restaurants create jobs.” The CFIB said it loves the Liberal plan to exempt small business from EI premiums for new hires, which has lots of job potential.
The same PBO report that looked at the Conservatives' tax credit and identified the flawed program that would cost $700,000 per job also identified that the Conservatives are collecting billions of dollars in excess of taxes in EI over the next two years and that the Conservatives actually have the capacity to cut EI premiums significantly.
The PBO estimates that artificially high EI rates under the Conservatives will cost the Canadian economy 10,000 jobs over the next two years. That is 10,000 more Canadians who will be out of work over the next two years because the Conservatives are using artificially high EI premiums to pad the books to fund pre-election spending. The Conservatives are ignoring the evidence and putting Conservative politics ahead of the Canadian economy and ahead of the interests of Canadian workers and employers.
Speaking of ignoring the evidence, the Conservatives appear ready to go ahead with their flawed income-splitting scheme that was introduced in their last platform. The idea that the Conservatives were putting forth in their last platform has been panned by everyone from the C.D. Howe Institute and the Canadian Taxpayers Federation to the Mowat Centre and the Canadian Centre for Policy Alternatives. It was even panned by the late Jim Flaherty himself.
It is being panned because, as articulated in their platform, fewer than 15% of Canadian households would benefit, most of them high-income households, at a cost of $3 billion per year to the federal treasury and another $2 billion per year to provincial governments. Provincial governments, as we know, are facing deficits and huge fiscal challenges.
Under the Conservatives' scheme, the , earning $320,000 a year and with a stay-at-home spouse, would save about $6,500 per year. Meanwhile, a Canadian earning the average industrial wage and with a stay-at-home spouse would save less than $10 per week, and most households would get no benefit whatsoever.
We have a different approach. The Liberal approach is that we need to build a plan for 2015 that would be focused on creating jobs and growth to strengthen the Canadian middle class. The status quo is not working. The current federal government is so preoccupied with day-to-day politics that it has lost track of and is out of touch with the challenges and opportunities facing Canadian families. Those are challenges such as aging demographics and a slow-growth economy, which some refer to as secular stagnation. Baby boomers are rapidly approaching retirement age, and as they exit the workforce, they will leave a shrinking tax base and labour shortages in their wake. They will also place a greater strain on health care systems as they age. We will end up with more Canadians using the social safety net and fewer Canadians paying into it. These demographic pressures are leading economists to predict that slow economic growth could become the new normal.
The Canadian economy, frankly, is already sputtering under the Conservatives. Job growth over the last two years has been extremely weak, consumer debt is high, infrastructure is in disrepair, and housing prices in our cities are inflated. Last year the Canadian economy created a paltry 5,300 net new full-time jobs across the country. The percentage of Canadians working today is still two full points lower than before the downturn. There are 200,000 more jobless Canadians today than before the downturn, and the number of Canadians who are considered long-term unemployed is twice that of 2008. More than 150,000 Canadians are unemployed and have been searching for work for a year or longer. As we all know, the longer they are out of the workforce, the harder it is for them to get back in.
On the other end of the spectrum, we have young Canadians who simply cannot get their foot in the door of the Canadian labour market. Recent grads are facing huge challenges. There are 200,000 fewer jobs for young Canadians today than before the downturn, before 2008. Persistently high youth unemployment and under-employment is robbing a generation of people of opportunities they need to succeed. TD economist Craig Alexander and CIBC economist Benjamin Tal describe a scenario of a lost generation of Canadian youth and a lost generation of potential for all Canadians.
This is despite the fact that this generation is the most technologically adept, most educated generation in our nation's history, and therein lies the challenge we face. There is a gap between the education they have and the job market. We have people without jobs and jobs without people.
Too many Canadians in their twenties are left saddled with big student loans and are unable to make ends meet. All too often, it is their middle-class parents and grandparents who are footing the bill. Among the hardest hit are Canadians who are actually squeezed between helping their adult children pay the bills and taking care of their aging parents at the same time, the sandwich generation. In many cases these parents in their forties, fifties, and sixties are taking on additional debt or dipping into their retirement savings. In fact, this is one of the things that is driving record levels of personal debt, which is about $1.65 for every dollar of annual income. According to the Canadian Financial Monitor, Canadians who are 55 years of age or older are two and a half times more likely to refinance their mortgage if they have children than if they do not have children. Their average household debt is twice that of their childless peers.
Meanwhile, many younger families do not actually have a mortgage to refinance. Instead, they are being priced out of the housing market altogether.
On this front, the Conservative government must share at least part of the blame for the high housing prices in Canada and commensurate personal debt. It was the Conservative government, in budget 2006, that brought in 40-year mortgages with no down payment. It introduced them for the first time in Canada. It had an effect, because in the first half of 2008, more than half of all new mortgages in Canada were 40-year mortgages, and 10% of those had zero down payment.
The Conservatives shifted Canada's borrowing culture and lending culture, and that shift has helped fuel record levels of housing prices commensurate with that household debt. They have since reversed course and returned to the norm that was the case under Liberal governments in the past, meaning 25-year mortgages with at least 5% down. However, it is important to recognize the Conservatives' culpability in bringing 40-year mortgages with no down payments into Canada and helping fuel record levels of personal debt related to skyrocketing housing prices.
From the OECD and the IMF to the Bank of Canada, one thing on which Canadian and international economists agree is that elevated housing prices and household debt pose a big domestic threat to our economy. These elevated housing prices have helped widen the generational divide between those on the one hand who have watched the value of their house appreciate and in some cases have tapped into that equity to help fund consumption, and those on the other hand who cannot afford to even enter the housing market.
We are seeing greater income inequality in Canada, and fewer Canadians now think of themselves as being middle class. In fact, the number of Canadians who self-identify as middle class has dropped from 64% in 2009 to 47% in 2014. Even more troubling is that for the first time in recent history, more Canadians now believe that the next generation, their children and grandchildren, will be worse off, not better off, than they are today. That is the first time this has happened in Canada.
What we need is a federal government that will rise to meet these big challenges facing our country: aging demographics, slow growth, soft job market, and high levels of youth unemployment and underemployment. These are all challenges, but they also represent opportunities. I will give one specific challenge to our country that is a big social and economic challenge but that also represents an opportunity if we can get it right.
Over the next 10 years, there will be about 400,000 young aboriginal and first nation Canadians who will be of workforce age. If they have the skills they need for the jobs of today, that would be really good for our economy. If they do not, it represents a demographic, economic, and social time bomb for our country.
The reality is that we have failed collectively as governments at all levels to address this challenge. If we take it seriously, young aboriginal workers can be part of a Canadian growth and economic success story. We have to get it right. We have to take these issues seriously.
Liberals believe that sustainable growth and a focus on creating jobs, growth, and opportunities is the best way to benefit Canadian middle-class families and to restore hope to them. We believe we need to invest in infrastructure, training, innovation, and trade, and we believe that we need to keep our competitive tax rates.
Bill does nothing to grow the Canadian economy, and it ignores the very real challenges of the middle class and of young Canadians.
In a very short period of time, potentially within days, we will be seeing a fall economic statement. We hope the government chooses to invest in the future by investing in infrastructure, in training, and in young Canadians. We need the government to do so, and if this government does not, a future Liberal government will.
Mr. Speaker, I am sharing my time with the member for.
I listened this afternoon to all the speeches. The job of members opposite is to be the opposition. I listened to some of the speeches from the NDP side and I know it has never been in government, so it can pretty well say anything. As far as the Liberal side is concerned, it too is in the same position.
When in government we have to make sure everything is in balance. We expect criticism, which is fine. However, let us look at the global picture. Nearly 1.2 million net new jobs have been created in Canada. That is over 82% full-time jobs and 80% in the private sector since the end of the recession in July 2009.
When we look at our country, Canada is the envy of the world because Canadians as a whole live well, and as a whole we are safe. It is the best country in the world in which to live.
As parliamentarians and members on this side of the House know, as we went into the recession, the most important thing was to ensure that our country's economy was balanced so that there were jobs, so that people could live in their homes and buy their food. In any country, nothing is perfect. There are housing problems and other issues in all countries. However, in Canada, we have a lot to be proud of. Canada has one of the strongest job growth performances in the entire G7. That is quite incredible looking at the global economic problems that the world has faced. Canadians have also enjoyed one of the strongest income growth performances in the G7 and Canada's business investment performance has been the strongest in the G7 over the recovery. This is very important. Why? It is because this gives a sense of security to Canadians.
Since 2004 Canadians have put our government into power because they had the confidence that the economic part of their lives would be secure. That does not mean to say every single Canadian is secure. It means that we are the best country compared to others. Canada has a AAA rating in this economic environment worldwide. We also know that the middle class in Canada lives better than in the U.S. and many other countries. Also, we now have 180,000 children who are now out of poverty.
There is a lot to be proud of. For the sixth straight year the World Economic Forum has ranked Canada's banking system the soundest in the world. This means something. With all due respect, even though there are always things to improve and do better, this is indicative of Canada's standing on the world stage and indicative of its very sound economic planning and practices. Does that mean everyone is going to get everything they want, daily? No, that does not mean that. It means that the economy within the country is sound, jobs are growing, people can go to work, children can go to school, and our country is the best country in the world in which to live.
I listen to all these criticisms and all the hyperbole. In Parliament, hyperbole is something that we hear every single day on probably every single topic.
When Canada is leading the global economic recovery, that is something to be proud of. There needs to be a recognition that Canada and this government are doing something right. When we listen to members opposite, we hear all the talk of gloom and doom. They think they can do things better. The fact of the matter is that this is not what the Canadian public thought, because those members are not sitting on this side of the House.
Canada has the lowest overall tax rate in the G7 on new business investment. That is a red flag right there. It shows that this government is creating new business.
Canada is one of only two G7 countries to have a rock solid AAA rating, with a stable outlook, from all the major credit rating agencies, such as Moody's, Fitch, and Standard & Poor's. That is important. A lot of countries cannot claim that, because they have no plan in place. War-torn countries have not had the opportunity to put a plan in place. It is impossible for them to do that. This government has been able to meet that high standard.
There is a reason our government's top priorities are job creation, economic growth, and long-term prosperity. It is so people can have families, work, prosper, and have a future.
Our government has become aware of many issues that have presented themselves through businesses. For instance, small business is the engine of this country. It pushes out so much of the economy. Women are some of the top small-business owners, and that is a real change from 20 years ago.
More small business opportunities have been created through the small business job credit, and that has been a real asset to those women who want to start businesses. That is not often spoken about in the House. Some of these businesses are run out of the home. Some are run out of small offices. These businesses are providing income for families.
The budget implementation bill will make life more affordable for Canadian families. What is important to a family? A lot of children participate in sports. It was presented to our government that a lot of families could not afford to pay the registration fees for sports, such as soccer and other kinds of sports, so in this particular budget, our government has doubled the children's fitness tax credit to $1,000 and has made it refundable.
Paying attention to individual families has made a huge difference in balancing Canada's economy. We have heard today many instances of how families have been impacted. Unfortunately, because I only have 10 minutes to speak, I cannot list them, but they were listed earlier.
We should work collaboratively to give suggestions. When the bill goes to committee, amendments can be made, if need be. We should look at how we can build together and recognize the fact that this government has put in a strong economic plan.