FINA Committee Report

LIBERAL DISSENTING OPINION

The Liberal Members of the Standing Committee on Finance would like to re-iterate their appreciation to the hundreds of Canadians who appeared before the committee to share their thoughts and insights.  We would also like to thank the Clerk of the Committee for co-ordinating the process as well as the Committee’s research and support staff for their countless hours of work.

Thanks to the tremendous efforts by everyone involved, the pre-budget report contains many useful recommendations that we hope will be considered for the 2007 budget.

The theme for this year’s pre-budget consultations was competitiveness.  While Canada’s fiscal track record for the past decade has been impressive, our competitiveness must always be measured against the countries with which we compete.  The Liberal Members of the Finance Committee believe that government has a creative roll to play is fostering the right conditions for a competitive and prosperous Canada.

Not all the recommendations made to the committee could be included in the report.  As a result we, the Liberal Members, have prepared this minority report containing further recommendations which we urge the Minister of Finance to give serious consideration to.

Sustainable Development:

As the testimony heard by the Committee demonstrates, it is increasingly accepted that the country’s economic development should not be at the expense of the environment. Yet this report says nothing about various concerns regarding the environment expressed by Canadians and Liberal MPs who are members of the Standing Committee on Finance. Among the recommendations of the Green Budget Coalition, which comprises 20 environmental and conservation organizations, we wish to put forward the following to address this shortcoming:

a)      Accelerate the government’s review of the Canada Environmental Protection Act (CEPA) and study the possibility of instituting a ‘toxics charge’ for violators of CEPA;

b)     Renew the Canadian government’s commitment to the Species At Risk Act (SARA) and ensure the effective implementation of SARA’s mandate;

c)      Significantly invest to effectively restore, protect and enhance the environment of the Great Lakes and St. Lawrence Region;

d)     Significantly invest in an Oceans Agenda for Canada in order to complete a national system of marine protected areas and to develop and implement integrated oceans management plans for Canada’s oceans;

e)      Implement a greenhouse gas emissions targets-and-trading system for heavy industry, domestic aviation and other large emitters, to come into operation no later than January 1, 2008.

Commercialization:

To ensure that increased investment in research and development produces commercial success, the Liberal MPs who are members of the Standing Committee on Finance believe the government should take the necessary measures to promote commercialization. Specifically, we recommend the following measures:

a)      Create a business-led commercialization partnership board to review the various proposals for commercialization programs, including :

n               The creation of a post-secondary education research development and commercialization support fund, which would aim to strengthen the innovative and commercialization capacities of applied research performed in all post-secondary education institutions;

n               The development of a program for Canadian entrepreneurship chairs that focuses on product development, market research and business management or early stage companies;

b)     Reinstate and enhance the Social Economy Initiative to encourage the development of co-operatives and other community-based enterprises;

c)      Remove the barriers to investment in Canadian venture capital by foreigners;

Health:

Liberal MPs who are members of the Standing Committee on Finance are sensitive to the health-related demands made by various witnesses appearing before the Committee.  Specifically, we recommend the following:

a)      Allocate necessary funding in order to accelerate the implementation of Canada Health Infoway;

 

b)     Allocate 1% of the health budget towards initiatives and infrastructure that promote physical activity;

Infrastructure:

There are few things that can limit the growth of an economy and prosperity more than infrastructure that cannot support more growth.  Whereas the Government’s recent Fiscal Update called on the private sector to increase its investment in Canada’s infrastructure, the Liberal Members of the Finance Committee believe that the government must take a lead role by:

a)      Renewing the Prairie Grain Road Program;

b)     Investing in connectivity improvements and the expansion of information and communication technologies in rural and remote areas;

c)      Expand the types of infrastructure projects funded through the gas tax Agreement to include municipal initiatives for economic development, sport and recreational facilities such as parks, and cultural and other social infrastructure.

Taxation:

The Committee heard from various organizations that the Government’s record on taxation has been moving Canada in the wrong direction.  When asked if a second percentage point reduction in the GST was favourable, an overwhelming majority of the Committee’s witnesses felt that it was not the best thing to do in terms of creating a competitive tax regime. The Liberal Members of the Finance committee urge the government to undertake the following:

a)      Immediately increase Old Age Security and the Guaranteed Income Supplement;

b)     Reinstate the Canada Child Tax Benefit Supplement for children under the age of six;

c)      Accelerate the rate of increase for the Basic Personal Exemption;

d)     Increase the Spousal Exemption to match the Basic Personal Exemption amount;

e)      Institute a tax exemption for emergency volunteer workers.

Miscellaneous:

Finally, the Liberal MPs who are members of the Standing Committee on Finance feel compelled to act on other no less important issues raised during the consultations. We recommend the following:

a)      Maintain the Canada Post’s financial contribution to the Publications Assistance Program;

b)     Restore cuts to women’s programs at Status of Women and further increase funding by a minimum of 25 per cent;

c)      Financially support the development of the Voluntary Gateway;

d)     Amend the Employment Insurance Act to introduce a Yearly Basic Exemption in the amount of $3,000;

e)      Make more funding available for colleges, CÉGEPs, vocational schools and institutes for infrastructure and modern equipment;

f)       Financially support the Canadian Association of Science Centres;

g)     Allocate funding necessary to ensure that equipment needed to be replaced by the Department of National Defence be sufficient in order for Canada to fulfill its military obligations;

h)     Ask the Canadian Space Agency to immediately undertake a planning process involving the key stakeholders (government, industry, academia and international partners) to identify space based solutions and systems that best meet Canada’s current needs and to submit funding options for Government consideration;

i)       Support sector councils which bring together all the stakeholders to identify and implement industry-driven labour market solutions, in a focused and organized manner, sector by sector.

j)        Work with provinces to establish and allocate proper funding to a national standards network to facilitate national credit and apprenticeship transfer and prior learning and recognition standards;

k)     Transform the Northern Residents Deduction into a Refundable Tax Credit;

l)       Continue the RAP program after March 31, 2007 and increase the maximum amount that can be withdrawn from RRSP from $20,000 to $25,000.