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Results: 1 - 15 of 15
View Pierre Poilievre Profile
CPC (ON)
View Pierre Poilievre Profile
2018-11-21 16:26 [p.23682]
Mr. Speaker, the finance minister has demonstrated that he can do two things at one time. He can give a speech while adding almost a million dollars to our national debt, in the same half-hour. I congratulate the minister, and we know that Canadians will get the bill for that new debt.
Our government has told us, under the leadership of this Prime Minister, that budgets balance themselves. He predicted that this self-balancing budget would manifest in the year 2019, barely a month from today.
Today, the finance minister has presented a fiscal update, in which the deficit is three times the size the Liberal Party promised in the last election and in which the deficit will not only be in place next year, when it was promised to be gone, it will actually be bigger than it is right now. In fact, this economic update reports that the deficits for the next five years will all be larger than the Liberals projected just six months ago in the 2018 budget.
None of us on this side is surprised that the finance minister and the Prime Minister failed to take responsibility for these promise-shattering deficits. Like most Canadians, we have come to accept that these Liberals never take responsibility for anything, but what is startling about this particular statement is that they just go on doing more and more damage to the fiscal situation of this country, without any concern or hesitation.
What we learned in this document that we did not already know is that not only do the Liberals break their promise, not only will they fail to balance the budget next year as they said, but they now admit that under their plan the budget will never be balanced. There is no time period into the future when they are even committing to returning to a situation where the debt stops growing. That is effectively the election platform they are running on today, that there will be deficits forever and that there could never be an occasion where the government would live within its means.
These two gentlemen of great privilege have inherited enormous fortune: balanced budgets from the previous government; booming U.S. and world economies; a roaring housing sector in Vancouver and Toronto, which has poured more revenue into government coffers; record low interest rates, which make debt more affordable temporarily. All of these factors are out of the government's control but have, through the goddess Fortuna, rained money on the current government, $20 billion of additional revenue, I am pleased to report to the House.
The Prime Minister took that $20 billion and did the responsible thing. He put it against our national debt. He saved it up for a rainy day. He reinforced our foundation against forthcoming storms. I am kidding. He blew every single penny of it, and it was not enough. On top of that windfall, he had to spend $20 billion more.
We are told to take comfort in the debt-to-GDP ratio. All ratios have numerators and denominators. With the Prime Minister lecturing us all about the need to teach us all in the House, as his pupils, he should actually know that. The reality is that the only way for that debt-to-GDP ratio to decline is if inflation and GDP are constantly going up. I just pointed to the factors that the government admits have led to the windfall of revenue before us. That can only continue as long as the world factors, which are out of the government's control, continue on at this pace.
In other words, if a crisis of any kind, another international financial recession, a massive problem with international security, a natural disaster or any other such kind of difficulty, led to the compression of the denominator, then we would face a crisis in the nation's finances. In that crisis, the Liberal government, if it were to keep its promise, something that none of us believe it would ever consider doing, would then be in a position where it would have to raise taxes or cut spending at a time when the economy needs the opposite. Therefore, the Liberals are putting our future in a reckless state of danger by spending our tomorrow on their today.
The second consequence of these growing deficits is this. When governments spend more than they have, they compete for scarce goods and services, which drives up inflation, making the cost of living more and more expensive. We have seen inflation reach nearly 3%, the upper end of the Bank of Canada's range of acceptable levels of consumer price index increases. That is in part, I believe, because the current government is overspending, increasing demand with unnecessary government spending, pouring money into the purchase of the same goods and services that Canadians have to compete for.
Furthermore, when governments borrow, they have to sell bonds. When those bondholders purchase the bond, they get interest in return for it. Why would they lend money to a Canadian homeowner for 2.5% when a rapidly borrowing government will give them 2.75% or 3%? The answer is they would not. That is the reality of the credit markets. When governments borrow, they compete with Canadian consumers and homeowners and drive up the cost of interest on those same people. In other words, while Canadians face record household debt, the government's insatiable appetite for debt is actually making that problem worse, not just in the future but here in the present.
Speaking of the future, we all know that debt today means higher taxes tomorrow. The Parliamentary Budget Officer has indicated that the cost of borrowing for the Government of Canada will rise by two-thirds, to almost $40 billion, over the next four to five years. That is almost as much as we transfer to the provinces to fund our entire health care transfer. In today's update, the government admits that the cost of borrowing is going up. For the first half-year, the increase in the borrowing cost has been 14.3%. That is the combined result of growing deficits and higher interest rates. In other words, at this pace, there will be a massive wealth transfer from working-class Canadians, who will pay higher taxes so that wealthy bondholders and bankers can collect more interest. Even socialist economists recognize that interest on national debt represents a wealth transfer from the working class to the wealthy, because those who own bonds are those who can afford to buy them. One cannot lend money if one does not have money. Therefore, those with money benefit when governments go out and borrow. Instead of the government favouring the have-nots, it once again favours the have-yachts, something we have come to expect from it for a very long time.
We were told that this economic update was going to respond to the attempt by the U.S. President to take our money, business and jobs. So far, the Prime Minister has been prepared to help the President in all of those objectives. His carbon tax, his decision to block pipelines and his massive regulatory state that prevents businesses from functioning here in Canada have driven money out of our country. Canadian investment in the U.S. is up two-thirds and U.S. investment in Canada is down by half, and when money leaves, jobs leave.
A senior at the Business Council of Canada says that the result of this imbalance could lead to half a million jobs lost in this country. What is the government's response to that? Liberals tell us they are going to be bringing forward something called the centre for regulatory innovation. I think that for most people who have dealt with the red tape the government has put forward, the last thing they want to see is more regulatory innovation because so far, that regulatory innovation has meant blocking the northern gateway pipeline. They came up with innovative ways to make it impossible for Trans Canada to build the energy east pipeline. Of course, their most innovative stroke of genius has been to drive Kinder Morgan out of this country by giving them $4 billion of Canadian tax money in order to buy a 65-year-old pipeline that we already had, money that the Texas oil company is now using to build pipelines in the United States of America.
When the Prime Minister took office, three of the world's most respected pipeline companies were ready to put shovels in the ground. Kinder Morgan was going to build Trans Mountain. Enbridge was going to build northern gateway and Trans Canada was going to build energy east. They had the financial commitments, the applications in and they were ready to go and all three of those companies have now left. What does the government offer? A centre for regulatory innovation.
However, that is not all. I should give the Liberals credit for another very exciting announcement they have made in regard to regulation. They are going to make the building code available to all Canadians for free and just in time for Christmas. That is if Canada Post is not on strike and unable to deliver the building code to those Canadians who are anxiously waiting to receive it.
That is the plan that the Liberals have to unwind the massive regulatory obstacles that have driven our oil, our money, our businesses and our jobs right into the arms of Donald Trump and nothing in this announcement today will reverse that direction. In fact, the government has backed down on NAFTA, giving President Trump everything he asked for and getting nothing in return that we did not already have.
We on this side of the House will stand up for the common sense of the common people, the people who understand that budgets do not balance themselves because those people, unlike our leader, have actually had to balance a household budget. A future Conservative government would recognize that we cannot spend what we do not have and we cannot borrow our way out of debt.
I conclude today by challenging the government. I know how painful it is for the Liberals to hear the truth, the painful truth from which they have for so long tried to turn away their eyes. Unfortunately, they have to face up to the fact that they shattered their promise to balance the budget next year, they have built up massive new debt not only for future generations, but for present-day Canadians, the cost of government is driving up the cost of living and that is leading to a serious crunch on the backs of everyday Canadians, Canadians who know what it is like to live within their means.
This is why a Conservative government will make sure that the budget will be balanced in the medium term, to deal with the massive deficits accumulated by the Liberal government and previous governments.
The Conservatives recognize that Canadians work hard for their money and they must balance their own budgets. As a government, we will help them and will not make things harder for them, like the current government is doing.
As the official opposition, we are calling on the government to meet Canadians' demands, tell them how the budget will be balanced, create a plan to do so, and lower taxes so that Canadians can keep the money they earned.
We will put forward a government in the future that will stand with those who know how to balance a budget, because they do so in their own households and they expect the very same of the Government of Canada. Under a Conservative government, they will get no less.
View Gérard Deltell Profile
CPC (QC)
View Gérard Deltell Profile
2018-02-01 10:45 [p.16613]
Mr. Speaker, I am very pleased to rise today to share the official opposition's opinion on Bill C-62. As I said a few moments ago during the question and comment period following the speech given by the President of the Treasury Board, we are opposed to this bill. We think that it seeks to please union bosses rather than making public servants a priority.
According to the government, this bill seeks to improve the bargaining process, but we do not think that the government is taking the right approach. We do not think that this bill actually improves the process; rather, it seems its aim is to please union bosses. During the last election, those union bosses were prepared to invest $5 million in advertising just before the election, without any regard for campaign finance laws, just to hurt the government that was duly elected by Canadians in 2011. The political party that was in office at that time, the Conservative Party did what it could to respond, but of course it was at a disadvantage in terms of spending money and accountability. I will come back to that a little later.
Our concern with this bill is that this is payback. It is not the first payback by Liberal government to the union's leader, because we saw it a year and a half ago when the government tabled Bill C-4. Bill C-4 was established by the government to kill two pieces of legislation we introduced when we were in office, which would permit and give more democracy and transparency in the union system.
This Liberal bill is the logical next step for the Liberals, although certainly not for us, and fits in nicely with what the government is doing to thank union leaders for their generous support during the last election campaign. As I was saying earlier, this bill seeks to establish certain bargaining measures. However, make no mistake, the Liberals' real goal here is to make the union leaders happy with the government's position. This falls clearly in line with the Liberal policy to please union leaders.
Almost two years ago to the day, the then minister of labour, an MP from Alberta, introduced Bill C-4. I was the official opposition employment critic at the time so I worked with the minister, together with my friend, the hon. member for Foothills. We fought tirelessly against that bill, which sought to annihilate two bills that were introduced and passed by the Conservatives under the previous prime minister between 2011 and 2015. Those two bills, C-377 and C-525, addressed democracy, transparency, and accountability of unions.
We Conservatives believe that if workers are to have the respect they deserve, they must be given the necessary tools. This includes asking union leaders to disclose their salaries and financial statements to the public. At the time, it was argued that this was something they could do themselves. However, when a union member pays his union dues, he is entitled to a tax refund. That concerns all Canadians, because it is their money being handed out as tax refunds, to the tune of $500 million.
Union leaders were not pleased that we were asking them to disclose all their expenses and salaries. However, when you have nothing to hide, you have a clear conscience. Of course, their natural allies, the Liberals, opposed the move and pledged to reverse the decision, which is tantamount to doing away with transparency. Thus, one of the first legislative positions of this very government, which boasts about being the most transparent in history, was an attack on union transparency.
This was the first bill that was killed by Bill C-4. The other bill was about democracy inside the union. If workers wanted unions in their shops, we asked to have consultation, but private consultation, a secret ballot. This is the best way to ensure people will be represented. The will of the people will be expressed with a lot of strength under secret ballots.
You will remember, Mr. Speaker, that two years ago you were elected by secret ballot, which is good. Who can oppose secret ballots in the House of Commons? When we elect a Speaker of the House, it is by secret ballot. However, the Liberals do not want to have secret ballots when workers decide whether to create unions in their shops. That is not fair. This is why we were, and still are, the champions of democracy and transparency in unions. Why are we champions of that? First and foremost, the most important people in the workforce are the workers, not the union bosses.
However, that is what the Liberals would do with this bill. The Liberals are on the side of union bosses instead of being the champions of the workers. I can assure the House that we will always be on the side of the workers. The government wants to kill that democracy and transparency.
That is what the Liberal government is trying to do with a series of bills to please union bosses and chip away at, if not wipe out entirely, everything the Conservative government did to enhance union transparency and democracy. That is why we still oppose this bill, which we do not think is right.
I should also point out that the government's approach has been a bit sloppy. Bill C-62 is a mash-up of two previously introduced bills, Bill C-5 and Bill C-34. Bill C-5 was introduced in February 2016, which is almost two years ago now, and Bill C-34 was introduced in November 2016. The Liberals have extracted elements of both bills and inserted them into the bill we are debating today. Aside from the fact that we disagree with the provisions in the bill, which is no secret, we expected greater diligence from the government on this matter. They are the ones who will have to answer for it, though.
Members will recall the unfortunate statements made almost two years ago when debating Bill C-4 in the House. One of the arguments made by Liberal opponents was that the bills we passed, namely Bills C-377 and C-525, were backdoor bills. One of the most eminent members of the Liberal caucus, the member for Winnipeg North, said this. We know this member often rises to speak. He is vocal in the House, to say the least.
Those were sad memories for me when my friend, the Liberal member for Winnipeg North, called the two pieces of legislation “backdoor bills”. They were private members' bills. That is disrespectful. Each and every member of the House is a front-door member. Therefore, when we table something, it is tabled by the front door. There are no backdoor members, no backdoor pieces of legislation, no backdoor nothing. Everything is done by front-door members of Parliament, from whatever party. That is where we stand.
This experienced member's comments were an insult to all his government colleagues who introduce private members' bills, which we Conservatives respect even though we may not agree with them. That concludes my remarks on this bill.
We are very concerned about this bill. We believe that it is important to think of the workers first and foremost. We realize that government officials and, of course, union officials are in the midst of negotiations.
That goes without saying. One cannot negotiate with 500,000 people. We understand that, but those 500,000 people must trust the representatives they appoint to negotiate with government officials. The best way to establish this trust, to strengthen it, to cement it, if you will, is to ensure that there is greater transparency and democracy within unions, and the best way to achieve that is to have full disclosure. Then, if they want to make that leap and establish a union, they can use the secret ballot. That is the best way and the one which can be influenced the least, whether in a positive or negative manner. Unfortunately, this government has directly attacked this principle, which we consider to be fundamental.
In response to my question, the President of the Treasury Board referred to certain financial realities in Canada, but he forgot to mention a few things, particularly when he talked about support for families. The foremost duty of the President of the Treasury Board is to balance the books. Theoretically, he is the government's “Mister No”, the person who says yes or no to government spending. Why did he say yes to the first plan for government assistance for children, when the government forgot to take into account one minor detail, namely, inflation? As a result of this oversight, four years from now, parents will be getting less than they did from our former government six years earlier. Way to go, guys; that is great.
Any junior accounting technician in a company who forgot to calculate inflation would be kicked to the curb. How is it possible that the President of the Treasury Board, whose primary duty, undertaken at the behest of the Prime Minister, is to make sure that the numbers add up, somehow missed this administrative detail, namely calculating inflation? That is pathetic. He should be ashamed of such an oversight.
On another note, we also provided assistance for children, but we had a balanced budget. I am appealing to the President of the Treasury Board's dignity and sense of responsibility. He has a duty to balance the books. This government is running colossal and compulsive deficits.
Two and a half years ago, the Liberal Party campaigned on running small deficits during the first three years and balancing the budget in 2019 when the economy is strong. That was the Liberal promise. Where are we today? This government has created deficits that are two and a half times larger than promised, and worse yet, it has no clue how it is going to return to a balanced budget. Never in the history of Canada, in peacetime, has a government had a strong economy and no plan to achieve zero deficit. It is unacceptable because the deficit leads to debt that will be left to our children, grandchildren, and great grandchildren to contend with.
I call on the President of the Treasury Board to tighten the purse strings. He is an experienced parliamentarian who has been serving this country for over 20 years in different capacities and on behalf of different parties. I appeal to his dignity and ask him to tighten the purse strings and especially to send Canadians a clear message that, just because his government has been overspending, does not mean that it will not balance the budget one of these days.
We think that the government should have a minimum plan to balance the budget. Will the government do so in 2019, as it promised? Will it do so in 2045, as the finance department's most recent report indicates will be the case if nothing changes? That would be absolutely ridiculous, but it would be even worse if the government had no plan at all for balancing the budget. Unfortunately, that is in fact the case. This government does not have a plan, and we very strongly condemn it for that. We are calling on the government to, at the very least, determine when it will balance the budget.
The government is turning its back on ordinary workers as it seeks to please its union leader partners and friends.
Ordinary federal employees have been suffering for almost two years now because of the Liberal government's bad decision to give the go-ahead to implement Phoenix. That is today's reality. We are gathered here in the House to talk about a bill that will make union bosses very happy. Meanwhile, unionized workers are still suffering as a result of the Phoenix problem. We have to be very careful here. Our thoughts are with all the heads of households and workers who have been hit hard by the Phoenix pay system problems. Enough can never be said and done to help these people. Canadian workers in my riding and the other 337 ridings have had their lives turned upside down by the Phoenix pay system.
A fact is a fact. The record shows that under the former government the ministers responsible put a kibosh on this project on two occasions. Both in July 2015 and September 2015, the ministers said that the Phoenix pay system should not be deployed because it was too risky. In January 2016, reports suggested not moving forward because the systems were not ready, it still had bugs, and most departmental financial directors recommended putting the project on hold. Unfortunately, on February 24 the government gave the go-ahead. In three weeks and a few hours, Phoenix will have been up and running for two years. A few weeks later, on April 26, the second phase of the Phoenix system was implemented. Nothing was done for 18 months even though alarms were sounding and red flags were raised all over the place. It took the Liberals months to admit that there was a problem.
It is sad that we are creating a bill that caters to union bosses instead of focusing on workers. Workers should be the priority, especially for the President of the Treasury Board, who claims that the government wants to be fair and equitable and says he wants to think positively and work together with the public service. However, today we are debating a bill introduced by the government in an attempt to pander to union bosses, instead of focusing first and foremost on the employees working in the public service.
For these reasons, we are going to vote against Bill C-62, because we feel it caters exclusively to union bosses. In fact, that was the same problem we had with Bill C-4, which attacked and demolished the fundamental principles of democracy and union transparency, principles that we and all workers hold dear. Bill C-62 is the logical but deplorable sequel to Bill C-4, which was tabled by the government almost two years ago now. We can therefore assure workers that we will always be on their side, not on the side of bosses and unions.
View Pierre Poilievre Profile
CPC (ON)
View Pierre Poilievre Profile
2017-10-03 10:09 [p.13828]
moved:
That, given the proposed changes to the taxation of private corporations as outlined in the Minister of Finance's paper “Tax Planning Using Private Corporations” will have a drastic negative impact on small and medium sized local businesses, the House call on the government to continue, until January 31, 2018, its consultations on these measures.
He said: Mr. Speaker, I will be splitting my time with the hon. Leader of the Opposition.
The government says it wants to avoid unintended consequences from its proposed tax changes. Here is one. What if these proposals simultaneously raise taxes and reduce government revenue?
Let us consider the government's new tax on so-called passive income. Under the present system, when all is said and done, small business earnings are taxed at the same rate as wages. The only difference is timing. Assuming a 50% personal income tax rate, a wage earner pays 50¢ on the dollar in the year it is earned. A business, by contrast, pays 15¢ in the year it is earned and the remaining 35¢ when she takes the money out of the company. The government claims that this is allowing the business owner to invest that 35¢ inside her company, growing a bigger nest egg than she would if she had paid all the tax up front. This, according to the finance minister, is unfair.
To prove it, the finance minister's so-called consultation document has a table showing how much better off this small business woman is from investing the after-tax proceeds of $100,000 of business earnings versus investing the after-tax proceeds of $100,000 in wages. In the first instance, the business owner has starting capital of $85,000, with the small business tax rate being roughly 15%, in most provinces. As an employee, she would have only $50,000 as starting capital.
The result is that if both she and her employee had the same money and invested the after-tax proceeds, she, as a small business owner, would have $62,000 at the end of a 10-year investment, and the employee would have about $58,000, using the round numbers the government provides in table 7 of its consultation paper. It is $62,000 at the end of the day at the end of the 10-year period for the small business woman, and $58,000 for the employee. It is not fair, right? However, there is one key detail the finance department excluded from this table. In fact, the only detail that matters is excluded, and that is who actually paid more tax, the small business woman or the employee, after the 10-year period, assuming a 3% rate of return, as the department's table does. The government omitted that calculation altogether. It did not want people to know who paid more taxes at the end of the day.
I had a respected tax modelling firm, headed by Jay Goodis, the chartered professional accountant and CEO of Tax Templates, do the math the government left out of the consultation paper. Let us break it down. It is true that the employee paid more tax up front: $50,367, to be exact. He then paid another $8,023 on the interest earned in the subsequent 10 years, for a total tax bill of $58,390.
The business woman, on the other hand, paid admittedly less money up front: $14,400. She then paid another $5,412 on her interest. So far it is true that the business person paid a little bit less. However, at the end of the 10-year period of investment, when she took the money out, she actually paid a whopping $45,238, because that tax was not avoided; it was merely deferred. She paid a total of $65,050, or about $6,700 more than the employee.
How is it possible that the small business person actually paid more tax and had more money at the end of the 10-year cycle? The answer is that the money on the deferred tax grew to a larger total, so when she pulled it out, there was more money to tax. In other words, both the business owner and the government are actually better off. This, again, is under the scenario the government put in its consultation paper, lest my friends across the way try to accuse me of contriving the right circumstance to get the right result.
To be fair, we need to take account of inflation. The business owner did pay the $35,000 in tax at the end of the 10 years, as opposed to the beginning, and during that time the value of money declined. The Bank of Canada has a target rate of inflation of 2%, which reduces the value of that $35,000 by $6,403, but still, even if we subtract that $6,403, the small business woman paid $250 more in tax than the employee did in this scenario.
The scenario of course was perfectly contrived by the government to produce the best possible result to make its case. Now I am using it to make mine, but if that business person and that employee had earned, say, 6%, which is still a very reasonable return, then the business woman would have paid almost $8,000 more in tax after inflation was factored in than the employee in the exact same circumstance.
Also, the calculation is extremely conservative. I am excluding the benefits of having the entrepreneur invest the money up-front and to pay the taxes later. For example, the companies she is lending to or investing in are paying her 3% for a reason. They are using her capital to hire people and buy profit generating assets, which also generate tax revenue for the government. I am excluding all of that revenue from my calculation.
The finance minister suggests that these types of passive investments inside a company constitute dead money. He is dead wrong. In fact, this bizarre claim contradicts his own consultation paper, which calculated that these very investments generate $27 billion in income every year. The only way these investments could possibly generate these returns is if the companies receiving the investments use them to fund their own growth.
How much of that growth would be lost if the government deleted the initial investment by forcing the business owner to pay that extra 35% up front on the principal, or a new double tax of 73% on the resulting income? The $27 billion in growth is a lot of money and it cannot be the result of dead money because we know that dead things do not grow.
The calculation I put forward also excludes other behavioural responses that would inevitably result from the government's proposed tax increase. With the punitive 73% tax rates the government is threatening to impose on passive income, how many of the investments I just described would simply not happen in the first place? How many young people would look at the diminished reward and simply say, why should I bother taking the risk, or why should I not just invest in another country? Even if none of these behavioural changes happen, if we believe the contrived scenarios the finance minister has developed to make his case, the government will still be getting less lifetime revenue, according to the calculations provided by Jay Goodis at Tax Templates.
When I asked the Finance officials these questions, they said it was true that the government would get less revenue, but that it would be fairer because it would be more neutral. That is the kind of negative, adverse thinking that the government has toward our entrepreneurs. This is not a policy of wealth distribution, it is a policy of wealth destruction. The only reason the government wants a policy that will reduce its revenue is that it will increase the revenue in the very short term as money floods out and into the coffers, because the Prime Minister wants to spend the money now and so he wants to tax it now. Our view is that he should consult more, fix these problems, scrap this tax increase, and focus on growing the wealth of the nation so that the rising tide will lift all ships.
View Peter Kent Profile
CPC (ON)
View Peter Kent Profile
2017-06-01 17:33 [p.11872]
moved:
That, in the opinion of the House, the extreme socialist policies and corruption of President Nicolas Maduro and his predecessor President Hugo Chavez have imposed considerable suffering on the people of Venezuela and therefore the House call upon the government to: (a) develop a plan to provide humanitarian aid directly to Venezuela’s people, particularly with respect to alleviating the severe shortages of food and medical supplies; (b) condemn the continued unjust imprisonment and treatment of political opponents who, as reported by Luis Almagro, Secretary General of the Organization of American States on March 14, 2017, “fear repression, torture, and even death”; (c) call upon the Government of Venezuela to respect the right of the people of Venezuela to hold a free and fair referendum to restore democratic rule in their country; and (d) recognize that Canada’s foreign policy should always be rooted in protecting and promoting freedom, democracy, human rights, and the rule of law.
He said, Mr. Speaker, I have brought private member's Motion No. 128 to the House to urge the government to more actively respond to the ever-deepening crisis in Venezuela. This is a crisis not only in terms of the brutal denial of democratic process, free speech, free assembly, and the rule of law in Venezuela but because of the humanitarian tragedy that worsens by the day.
First, a little history.
Venezuela is a magnificently beautiful, resource-rich country on the northeastern top corner of South America. Simón Bolivar, born there in 1783, educated in France, and a disciple of Locke, Hobbes, Voltaire, Montesquieu, Rousseau, and Napoleon, returned to the Spanish colony in 1807 and became the leading force, over succeeding tumultuous decades, in the liberation of the continent from Spanish rule and in the independence of Venezuela in 1830.
Jumping forward to modern times, after the Second World War a series of democratic governments presided over the then richest economy in Latin America, an economy driven by its vast oil and gas reserves. However, economic shocks, attempted coups and counter-coups, the impeachment of an embezzling president, and the collapse of public confidence in the government led to the 1998 election of a former coup-plotting soldier, Hugo Chávez.
Chávez launched what he called the Bolivarian revolution, rewrote the Venezuelan constitution, imposed extreme, often contradictory, socialist policies, and presided over the country's tragic downward spiral economically, socially, and democratically.
Chávez engaged in a close relationship with Iran and Cuba in support of terrorist groups like Hezbollah and anti-U.S. states. Under his gross mismanagement of the economy, his elimination of governmental checks and balances, and his survival of an attempted coup, Venezuela developed the worst inflation in the world.
As so many dictators have done over the centuries, Chávez blamed Venezuela's small but dynamic Jewish community for stealing the wealth of the country. His henchmen endorsed the Holocaust. Members of the Venezuelan state police were caught vandalizing and desecrating synagogues with crudely painted graffiti, the mildest being “No Jews wanted here”.
As minister of state for the Americas in 2009, I visited Caracas to hear testimony and to observe evidence directly linking the virulent wave of anti-Semitism to the personal direction of Hugo Chávez.
I must make clear, on behalf of Venezuela's Jewish community, that the long-suffering people of Venezuela did not then or now buy into the anti-Semitism of the regime. However, as the focus of state-directed anti-Semitic human rights abuse, many of the Jewish community have since fled to sanctuary abroad, a significant number now proud members of Canadian society in Thornhill, in the greater Toronto area, in Montreal, and elsewhere.
Under Hugo Chávez, poverty soared, as did crime and corruption. Malnutrition became common and chronic among children and adults. Chávez's death in 2013 and the election of Nicolas Maduro as his named successor, a vote widely considered to have been fraudulently manipulated, coincided with gross economic recession. In 2015, Venezuela's inflation rate passed 100%. Last year, inflation was estimated to have surpassed 700%.
To contain the rising outcry over severe shortages of food and medicines, Maduro last year imposed repressive states of emergency, renewed four times. Amnesty International has since documented a broad range of human rights abuses and crimes under international law.
Prison overcrowding and violence sparked by food and medicine shortages were blamed for a succession of deadly riots. Political opponents of the Maduro regime and pro-democracy protestors have been imprisoned without due process. Critical media companies have lost their operating licences. Unions have been hobbled and blacklisted. The supreme court, packed with regime loyalists, suspended an opposition referendum to recall Maduro and stripped Parliament of many of its powers. Public discontent has boiled over.
For the past two months, street demonstrations have been mounted in Caracas and other large cities and in smaller communities and villages across the country.
People are demanding elections, freedom for jailed politicians and pro-democracy activists, and foreign humanitarian aid for the sick and hungry masses, literally the masses. The street protests have seen steadily increasing violent actions by police, army, and vigilante groups that support the regime. Though the opposition leaders urge non-violent behaviour, protesters are increasingly responding to violence, unfortunately, with violence. At least 60 people have died on both sides of the recent protests. About 1,000 have been injured, and many hundreds of businesses have been looted and burned.
A recording obtained by one news agency is said to carry the words of an identifiable Venezuelan general ordering subordinates to prepare for the use of snipers against future demonstration leaders. Regime brutality in countering the demonstrations is already common. On one occasion last month, social media videos captured a government armoured vehicle deliberately driving into a crowd, killing and injuring civilians, and there are wide reports of civilians now being tried in military courts.
In March, the Secretary General of the Organization of American States, Luis Almagro, called on the 34 members, which includes Canada, to suspend Venezuela from the organization unless Nicolás Maduro's government moves quickly to hold free and fair general elections. In a 75-page letter to the organization, Secretary General Almagro set these conditions: elections within 30 days, the freeing of all political prisoners, the appointment of independent supreme court justices, and the reinstatement of laws suspended by the top court.
I would remind the House that Lilian Tintori, the wife of Leopoldo Lopez, Venezuela's leading political prisoner, who has been in prison and held unjustly for three years, has travelled the world pleading for support, meeting with Secretary General Almagro, President Trump, the UN High Commissioner for Human Rights, the presidents of Mexico and Argentina, and the Pope. Last month, in fact three days after we asked the Prime Minister in question period why he had not met with Señora Tintori, she was granted a meeting and met with other parliamentarians of all parties here in Ottawa.
When it came to a vote at the OAS, Canada, along with 19 other of the 34 member states, including Argentina, Brazil, Chile, Colombia, Costa Rica, the United States, Mexico, and Peru, voted to suspend. Voting against were a small number of Caribbean states, states dependent on Venezuelan cheap oil, along with Bolivia, Ecuador, El Salvador, Haiti, and Nicaragua, as expected. There were not enough votes. It was short of the two-thirds needed to pass.
In response, in anticipation of another vote, President Maduro petulantly denounced the charter of the OAS and announced Venezuela's withdrawal from the organization, more or less emulating Groucho Marx by rhetorically wondering why Venezuela would want to remain in an organization that would have Venezuela as a member. As well, Maduro compared the OAS demands for democratic renewal in Venezuela with the OAS suspension of Cuba in 1962 and quoted Fidel Castro's equally petulant quote then, when he denounced the OAS as the ministry of the colonies. That left the OAS still pondering next steps.
There has been increasing agreement among the majority of OAS members that Maduro's attempt to change the constitution would effectively be a form of a coup within a coup and that as the situation in Venezuela has intensified, the violent polarization is an increasing concern for other countries right across the region. As Secretary General Amalgro has said from the beginning, the Inter-American Democratic Charter outlines two measures that can be applied: diplomatic mediation, or full suspension and effective isolation by members. It is not as though mediation has not already been attempted by the Union of South American Nations, known by its acronym, UNASUR; by the Common Market of the South, known as Mercosur; by the Vatican; by the U.S. State Department; and, of course, by the OAS itself.
As the democracies of the Americas, and beyond, ponder next steps to encourage or pressure the Maduro regime, there has been an unfortunate intervention by the big U.S. investment bank Goldman Sachs, which last week bought devalued bonds of Venezuela's state oil company. Goldman Sachs is reported by The Wall Street Journal to have paid about $865 million, or 31¢ on the U.S. dollar, for bonds worth $2.8 million.
The bank has defended its purchase, saying that while Venezuela is in crisis, it made the investment because it believes life has to eventually get better. It is often said that money has no conscience, and opposition politicians in Venezuela not yet in prison are accusing Goldman Sachs of exactly that. Julio Borges, who leads the opposition in the national assembly, wrote a letter to Goldman Sachs saying, “It is apparent Goldman Sachs decided to make a quick buck off the suffering of the Venezuelan people.”
Venezuela's opposition has previously been urging American banks to avoid any financial investments in Venezuela on grounds that they would serve to bail out the Maduro regime, as the Goldman Sachs' bond purchase seems to be doing.
Was this a less than glorious moment for capitalism? Certainly opposition leader Borges said that he would recommend to any future democratic government of Venezuela to refuse to recognize or to redeem the bonds in question. However, I digress. I will turn back to the democracies of our hemisphere and the next possible steps.
Foreign ministers and ambassadors from 33 member nations attended a meeting yesterday in Washington. Venezuela did not show. Canada, Mexico, Panama, Peru, and the United States put forward a declaration calling for an immediate end to violence, the release of political prisoners, restoration of the rule of law, and a demand that Venezuela abandon plans to confect a citizens' assembly to write a new constitution.
Canada's minister said Canada was ready to do its part for a return to peace and stability. Brazil's foreign minister was somewhat more direct. Aloysio Nunes said, “We're taking about people dying.” He said that democracy is not a luxury and that we must collectively rescue Venezuela's fundamental freedoms.
However, the resolution failed again to get the necessary two-thirds' support because the usual Venezuelan crony supporters like Nicaragua and Bolivia and a number of short-sighted Caribbean nations that depend on cheap oil from the Maduro regime put forward a blocking resolution of their own.
In sharp contrast, as diplomacy stalled in the OAS assembly and the foreign ministers and ambassadors dispersed with a vague plan to return in a couple of weeks or so, yesterday Venezuelan military forces were using tear gas and water cannons to block tens of thousands of civilian protesters attempting to march on the foreign ministry in Caracas.
Therefore, with the Venezuelan crisis deepening by the day, with 60 dead and thousands injured and many more held as political prisoners, with malnutrition on the rise and public health services and hospitals unable to function because of a lack of essential pharmaceuticals, I will return to the motion I bring to the House today, Motion No. 128. Let me remind members very briefly what it says.
Motion No. 128 calls on the government to first develop a plan to deliver humanitarian aid directly to Venezuela's people, particularly with respect to alleviating the severe shortages of food and medical supplies. It also calls for the government to publicly condemn the continued unjust imprisonment and treatment of political opponents, who, as was reported by Luis Almagro, Secretary General of the OAS, fear repression, torture, and even death.
Finally, Motion No. 128 calls on the Canadian government to again call upon the Government of Venezuela for a free and fair referendum to restore democratic rule to that country.
View Tom Kmiec Profile
CPC (AB)
View Tom Kmiec Profile
2017-06-01 18:14 [p.11878]
Mr. Speaker, I am pleased to join this debate in support of the member for Thornhill on Venezuela, and I do have a Yiddish proverb, but I will say which one it is later. I want to start by establishing a couple of facts and very strong beliefs I have, having spoken a lot with the Venezuelan community in Calgary.
Hugo Chávez was a dictator. Nicolás Maduro was and continues to be a dictator. Hugo Chávez's rule was marked by the collapse of the private economy, from the nationalization of industries like cement, construction, a great deal of the food distribution system, wholesale markets, and the substitution of community groups for more central government, and we saw this throughout the Chávista rule. When Chávez was there, he started the slide of Venezuela from one of the richest countries, if not the richest country in South America, with the substitution of community groups by more centralized government, and the political party that he belonged to increasingly took over arms of the government. There was confusion between the two, just as there is today in the Russian Federation.
His rule was also marked by the erosion of the rule of law and of public institutions, which today has led to the collapse of public institutions, including the national assembly and the supreme court of Venezuela. People like Nicolás Maduro and people who support him look for opportunities like this to continue an autocratic socialist government. The fact is that, from Chávez to Maduro, Venezuela went from the richest country in South America to the poorest, most violent, and now the most autocratic and definitely the most dictatorial.
I want to dwell on the systematic abuses of human rights in Venezuela. Between April 1 and May 27 of just this year, we are talking about the arrest and detention of 2,950 peaceful opposition demonstrators, people who are tired of being abused, people who are tired of starving and being unable to provide for their families. Now, 1,329 of these people are still being detained today, 355 of them having received a trial and 189 being detained by military tribunals. These are civilians being tried before military tribunals. Some 60 people have been killed since April 19, and I want to update the numbers to the House because I spoke today with the executive director of the Canada Venezuela Democracy Forum, a Venezuelan expat who lives here in Canada, and he told me that, as of today, they are counting 78 people murdered by the Maduro regime. These are peaceful demonstrators who were simply going out into the streets to protest against a government they no longer trust, that they no longer believe in, and that they want out of power.
The coup d'état is what we hear from the Venezuelan opposition, but from many other groups too who have confirmed that the government of Nicolás Maduro now leads essentially an autocratic, dictatorial state with no basis whatsoever in Venezuelan law or international law. By decision 156, passed on March 29, the supreme court assumed the powers of the national assembly. These are the legislative powers that the national assembly had, so this violates the Venezuelan constitution. Recently Nicolás Maduro called to reform the constitution with a body of 500 members, so 50% will be appointed by Maduro himself—I can see a problem already emerging—and 50% from so-called grassroots organizations from government programs, which is all Chávista members; therefore all of them will be appointed directly by the government through whatever avenue he chooses. This violates electoral law in Venezuela as well as the constitution of Venezuela.
I and other members who have spoken have also had the pleasure of meeting with Lilian Tintori, who is the wife of a Venezuelan opposition leader who is illegally being detained in a military prison by the Maduro regime. I found her to be quite a fierce defender of human rights. She has become quite an activist for her husband, for the opposition parties, and also more broadly for the democratic push in Venezuela. She spoke of the hardships that people are experiencing there, such as the food shortages. Venezuela used to be a country where people could feed themselves. I know that the food shortages have been blamed by some on the collapse of the price of oil on international markets. However, Alberta experienced a collapse of the commodity market as well, and we are still able to feed ourselves. There is still food on the shelves. We can still go and purchase it. That is not the case in Venezuela.
There are drug shortages. Items like Tylenol are up 500%, a simple tablet of Tylenol, which can mean the difference between someone ending up in an emergency room and not.
In the case of those winding up in an emergency room in Venezuela, they are very likely not to get any treatment. There is simply no medication available at a reasonable price. People must go to the black market.
There have been month-long demonstrations where people have taken to the streets. It is easy to find out about these. They are on the news now. They started on Facebook and Twitter. People were posting about it and showing pictures of what is actually going on on the ground.
Lilian also spoke about the illegal detentions, the rounding up of members of the opposition parties. They are being arrested, randomly at times, detained for hours and days and sometimes weeks, and then released, only to be re-arrested. The regime is doing such things to spread fear. It is a reminder of the times that I still remember, when Poland and other ex-Soviet controlled republics in eastern Europe experienced exactly the same thing. Opposition members there have fought for their freedom and for democracy.
That Yiddish proverb I spoke about earlier relates deeply to Venezuela's conditions today. Peace is to man what yeast is to dough. The reason I want to talk about dough is that Maduro's regime is making this ridiculous, almost comedy-like attack on the private market, the private economy, where people find ways to fulfill each other's needs. The regime has actually attacked bakers, as of two weeks ago. It declared bakers to be special contributors. One Venezuelan baker translated the regimespeak for us, saying they have to pay double in taxes while facing shortages of milk, eggs, cheese, and deli products. In March, 80% of Venezuela's bakeries were reported to have no flour.
To dwell on bakeries and dough and yeast some more, in something referred to as the bread wars online now, Maduro's regime has accused bakers of hoarding and being allied to the imperialists. In fact, in a recent speech, Maduro accused them of waging a bread war against the Venezuelan people.
Now there are police operations ongoing still today, which are seizing owners of these bakeries and accusing them of hoarding flour. Now it is getting ridiculous. We know how serious the situation must be for the government of a country to be in the business of seizing bakeries and seizing bakery owners and sending them to jail for the simple crime of making cookies. One baker told NPR that they can only serve five customers per day. Effectively, that means they are only open 40 minutes after opening, every single day.
Now I'll turn to a personal story. This reminds me of the stories my parents used to share with me. Many members know that I immigrated to Canada from Poland, and I still remember the store shelves being empty in Poland in the early 1980s. I was only a little boy of four. The only thing people were certain to be able to buy in the stores was vinegar. There was ample, copious amounts of vinegar. The stores never ran out of it. We would go to a local cafeteria called, in Polish, bar mleczny, a milk bar, which does not mean there was actual milk because there was never any. However, people could get soup, a peach soup, and my dad would tell us stories about how people could buy this peach soup and all it really was was half a peach in a bowl of water. That was peach soup.
When I hear these stories about what Venezuelans are going through, I identify with it. I know what that looks like. That is why my family fled here to Canada.
The tragedy of Venezuela continues. Eight out of 10 Venezuelans are poor. There is a critical lack of medical supplies and money for health care that contributes to infant mortality rates that have soared 30% in one year. Maternal mortality is up 66%. Hyperinflation has vaporized the savings of an entire generation of people. One economist who tracks a common food staple, chicken, has calculated the annual inflation at 700%.
One other member did mention the president of the national assembly, Julio Borges, who said, after tearing up a copy of the supreme court ruling:
Nicolas Maduro has carried out a 'coup d'etat'...this is a dictatorship
This is from the man who would know best. This is from the person who is the head of the national assembly in Venezuela.
The Inter-American Commission on Human Rights has also condemned the regime for the militarization of the management of the protests. It has detained members, like the Contreras, who are now subject to military justice in full violation of Venezuelan law. They have been held completely incommunicado from any human rights groups.
This is all being tracked by organizations like Human Rights Watch. It says that, according to its numbers, there is abuse of prosecutions going on of at least 275 civilians by military records alone, official records.
I would say that this motion is extremely timely. It is time for Canada to act. It is not enough to go to the OAS. It is not enough to put out a warm-hearted press release. It is time to act and call for everything inside this motion. I am asking the government to support it. I am asking all members of the opposition to support this motion as well.
View Randall Garrison Profile
NDP (BC)
Mr. Chair, I have to say that I am disappointed with that answer. I was hoping to get a clear commitment since we all know that information derived from torture is not only illegal under international law, but is almost always useless, as people under torture will say exactly what they think people want to hear in order to stop the torture. I am very disappointed that the minister has not given us that assurance.
I want to move on to some other things since we only have a short time this evening with the minister. I actually want to talk directly about the budget. I know the people sitting in front of the minister have huge books full of numbers and I have numbers on my desk. Numbers are difficult to discuss, but the one thing that we have seen in the budget is that the operational budget for the Canadian military peaked in 2012 and began to be cut by the Conservatives.
Where it has not been literally cut, it has been increased by less than the rate of inflation. When it is increased by less than the rate of inflation, obviously something has to give. We cannot keep sustaining the same activities year after year if the funding does not go up with the rate of inflation. The rate of inflation in the military, as we all know, is somewhere between 3% and 4.5%.
In the main estimates and the operational budget for the military this year, the Canadian Armed Forces appear to have received significantly less of an increase than the rate of inflation. How can they continue all the things we are asking them to do on our behalf when they get less money than they need to carry out those tasks?
View Harjit S. Sajjan Profile
Lib. (BC)
View Harjit S. Sajjan Profile
2017-05-29 19:34 [p.11584]
Mr. Chair, when it comes to the budget and the planned increases, our government has maintained the planned increase and this year we increased it by 1% for the operating budget. That is a total of 3%, so the budget has increased by over half a billion dollars for the operating budget.
Also, I think the member opposite knows I made a number of speeches where I talked about the analysis of the defence policy review that we conducted and that even with this increase, we are still definitely on a decline. I am sure the member will be there on June 7 when I have the privilege of being able to announce our defence policies, where we are going to be talking about our plan to be able to fix and fill this hole and create a long-term plan for the Canadian Armed Forces.
View Sheri Benson Profile
NDP (SK)
View Sheri Benson Profile
2016-11-30 18:07 [p.7459]
Mr. Speaker, I am proud to rise today in support of Bill C-245, sponsored by my colleague, the member for Saint-Hyacinthe—Bagot, which would establish a national poverty reduction strategy.
Poverty is, sadly, still very much a growing problem in Canada. Since the unanimous motion by Ed Broadbent in 1989 to eradicate poverty in Canada by the year 2000, very little has been done by successive Liberal and Conservative governments to actually reach this goal.
In the intervening years since 1989, Canada has been proud of its position as the ”best” and “second-best” country in the world in which to live, according to various United Nations measurements. However, Canadians living in poverty, including an alarming number of children, are no better off than they were in 1989.
How can this be in a country as blessed as Canada, with natural resources, a skilled and educated workforce? How can we tolerate a situation where our neighbours are struggling to find shelter, put food on the table, and take care of their families?
In my office is a poster that say, “All it takes is political will”. That poster was created to commemorate Ed Broadbent's motion in 1989, which every member of Parliament voted to support. Yet here we are in 2016 and very little has changed. We obviously did not have the political will. Our governments have failed to make poverty reduction a priority.
Poverty reduction is a complex and challenging issue, but we must not let that paralyze us. Too much time has already been wasted by hand-wringing and repetitive consultations that do not produce any discernible improvements for people living in poverty.
Bill C-245 offers a turnkey proposal that the federal government can readily adopt and implement. It calls for the creation of an officer for the commissioner for poverty reduction, as well as a national council for the elimination of poverty and social exclusion.
These are concrete steps that would focus efforts in poverty reduction in a way that is measurable, accountable, and cumulative. Governments have often said that we cannot afford to do any number of things that would reduce poverty. On the contrary, we cannot afford to not do anything.
I would like to give credit where credit is due. The government has put in place the Canada child benefit and increased the guaranteed income supplement by 10%. Unfortunately, these measures, by themselves, are not sufficient to eradicate poverty in Canada in any meaningful way. The Liberals' Bill C-26, which is supposed to increase retirement security for all Canadians by improving the Canada pension plan, actually omits some of the most vulnerable from the enhancement: women who take time out to have kids and people living with disabilities. Whether this omission was an oversight or deliberate, the Liberals have refused to fix the bill, thereby doing absolutely nothing for two of the most vulnerable groups in society.
I come from the great riding of Saskatoon West, a diverse riding that, unfortunately, is no stranger to poverty, and there is a very high cost to poverty. In Saskatchewan, Poverty Costs, a coalition of community-based organizations, calculated that the economic cost of poverty in Saskatchewan was $3.8 billion a year.
Of course, the costs of poverty go beyond the dollars and cents spent on maintaining Canada's social safety net. The lost opportunity costs and the consequences of growing inequality among our residents impact all of us. In addition, poverty costs Saskatchewan $420 million a year in heightened health care service usage. Poverty also causes us to spend between $50 million and $120 million a year more than we would otherwise spend on our criminal justice system.
The same report also found that one in 10 of our population lacked the income needed to afford basic necessities. For a parent working full-time, minimum wage pays just over $20,000 per year. That is almost $15,000 below the poverty line for a family of four. Poverty affects us unequally and the numbers are shocking: 17% of Canadian children live in poverty, 33% of immigrant children, and 64% of first nations children.
Some of Saskatchewan's population, including women, children, newcomers, indigenous peoples, people living with disabilities, and those in rural areas are at greater risk of living in poverty and face systemic barriers that impede their efforts to rise above the poverty line.
Health disparities due to poverty are a direct result of substandard living conditions, inadequate access to nutritious food, and increased stress associated with making ends meet. The stresses of living in poverty can also be deadly.
In Saskatoon, low-income adults were 4.5 times more likely to experience suicidal thoughts and 15 times more likely to attempt suicide.
In Saskatchewan, and across the country, costs of living are rising, but wages and salaries are not necessarily keeping pace.
In 2012, Saskatchewan had the second-highest inflation rate in the country, and yet, still had the second-lowest minimum wage.
The good news is that, overall, there is an increased public understanding about the social determinants of health, and growing support for addressing the underlying causes of poor health. Some 94% of Saskatchewan residents support reducing poverty, with 89% supporting a provincial approach to poverty reduction in Saskatchewan.
Therefore, we had high hopes in Saskatchewan when the provincial government adopted a poverty reduction strategy in 2014. Unfortunately, the Saskatchewan Party has now backed away from this priority, at a time when it is needed most.
The evidence shows that working to reduce poverty in the first place costs less than paying to respond to the effects of poverty later. If we needed proof that poverty is growing instead of decreasing, we just have to look at last week's headlines.
According to HungerCount 2016, a comprehensive report on hunger and food bank use in Canada, Saskatchewan has seen one of the largest increases in the number of people accessing a food bank since last year. The percentage of children using food banks is highest in Saskatchewan. It represents 45% of everyone served.
Steve Compton, the CEO of the Regina Food Bank, added that a job is no guarantee against food bank use. Nearly one in six households helped in Canada are working, yet still need a food bank to make ends meet. A lot of this has to do with the fact that low-wage and precarious jobs with no benefits are the only job growth our economy is seeing. It is no wonder that Canadians continue to rely on food banks, and yet, the finance minister has said that we should all just get used to job churn.
The Liberal government needs to acknowledge that poverty is growing, and use the levers it has to encourage stable, long-term jobs, instead of shrugging its shoulders. A $15 federal minimum wage would be a good start.
I am very proud to say that in my riding, four progressive employers have already committed to paying their employees a living wage. A living wage makes a huge difference for families and individuals and their communities. A truly progressive government would understand this and act accordingly.
Last week, Campaign 2000 released its annual report card on child and family poverty. It is heartbreakingly sad that an organization whose goal it was to eradicate child poverty by the year 2000 is not only still in existence today but that they are farther than ever from their stated goaI. After decades of advocacy for children and families in poverty, Campaign 2000 is still calling on the federal government to create a national anti-poverty plan.
Its 2016 national report card, “A Road Map to Eradicate Child and Family Poverty”, provides the latest statistics on child and family poverty in Canada, and clear recommendations for federal government action and leadership to end child and family poverty.
Bill C-245 can be the first step. It has already been studied at committee, and the Minister of Families, Children, and Social Development has acknowledged it is an excellent bill.
The Liberals have stated many times in the House, and at various committees, that the federal government has a role to play in reducing poverty in Canada, and that Canada needs a long-term, collaborative strategy to combat poverty.
Safe and affordable housing, affordable child care, accessible health services, a living wage, and a basic income for everyone are all important factors that contribute to the well-being of all Canadians.
It is my hope this excellent bill will be passed without delay, and it will be part of a truly comprehensive and collaborative strategy that will finally tackle all the different factors that contribute to poverty in this country.
View Bob Zimmer Profile
CPC (BC)
Mr. Speaker, I would like to acknowledge the member who brought this private member's bill forward. I sit on the human resources committee with him, and as we have heard on the floor of the House tonight, we are working on a poverty-reduction strategy as we speak.
We all want to eliminate poverty, if possible. That is something we can all agree on. We are certainly concerned about families that are affected by poverty and cannot put food on the table or heat their homes. We have heard a lot of heartbreaking stories about poverty in Canada. However, I am concerned that this bill will create another level of bureaucracy instead of dealing with the issues of poverty.
As Conservatives, we had a good record to this effect. In 2004, poverty was at a record low, at 8.8%, which was dramatically down from 11.4% in 2004. What really affects Jane and Joe Taxpayer is lower taxes, because we are able to leave more money in their pockets and they can afford more at home. It is a Conservative principle that we like to leave more in taxpayers' pockets.
Some interesting testimony has come before us at committee. One that dramatically affected the committee, on all sides, was the testimony given by Mark Wafer. I do not know if the chamber has heard his story, but he has several Tim Hortons stores. One thing he has done that has really set the bar high for a lot of establishments is hire disabled persons at wages equal to those of the everyday people who work for him. There is no disparity between the disabled versus non-disabled people in his workplace. It is a great story. There have been hundreds employed, hundreds who essentially were taken out of poverty. They were sitting at home with no place to work and no place to go, and he gave them jobs. I asked him the number one way a person can get out of poverty. His answer was that the number one way to get a person out of poverty is a paycheque.
It seems like a very simple concept that a paycheque would help someone out of poverty, but that is as simple as it gets. It is more than just a paycheque. It is a way of life. It is hope, and it is a future. He gave an example of a person he hired who had a disability who had not had an opportunity before. After getting a job at Tim Hortons, he went on to work for a major accounting firm in Canada. We look at solutions like that as real solutions to poverty, not just another bureaucracy.
A Conservative principle that needs to be understood is that Conservatives care about people in poverty. The analogy I use is the old one we all know: Give a person a fish and you feed that person for a day; teach a person to fish and you feed that person for a lifetime. My concern is that this particular bill will establish a bureaucracy that attempts to study how to give a person a fish.
We want to look at real solutions to get people out of poverty. Mark Wafer is an example of someone who creates real change for people in poverty.
What concerns me about the different political parties' views on the way to get people out of poverty is that it is about larger bureaucracies and money through programs to help people out of poverty. What we on this side of the aisle are concerned about are Jane and Joe Taxpayer, regular people who are possibly watching tonight who are just home after a hard day's work. I was a former carpenter. Maybe Joe is a carpenter who is sitting at home trying to have a meal with his family, maybe Kraft Dinner again. It is the end of the month. Maybe they are stuck and that is all they have to eat, or maybe they have nothing at all. We are asking that same family to now pay for another program that will cost millions of dollars and will add more of a burden.
If we are talking about taxes, again the contrast is between the Conservatives reducing taxes as the true way for poor people to change and get out of poverty, and the reverse, which can also happen.
What I am going to refer to is more of a burden to Jane and Joe Taxpayer, but we seem to talk around it in this place. Indeed, I have not heard it mentioned tonight that much, and here I mean the carbon tax.
The government talks a good game. It talks about wanting to see people come out of poverty. I absolutely believe that the NDP as well as the Liberals want people to get out of poverty, but when we continually ask people to pay more, we know that people who are already close to poverty or in poverty will be disproportionately affected by these taxes, and the lower the income the greater the effect. If we put in place a carbon tax, the person who is at or below the poverty line would be much more dramatically impacted than someone who is not.
Taking a simple look at the carbon tax, guesstimates have been made of its impact: $1,000 on individuals and $2,600 and upward on families. Of course, we have not factored in the inflationary effects on food prices, and the extra cost of clothing and absolutely everything. I think a fulsome conversation about carbon reduction has to consider taxation and the reverse effects of pushing people into poverty.
It is always assumed that Jane and Joe Taxpayer can always bear more. The effective tax rate of individuals is 50% in some cases. For some people, half of their paycheques are going to tax, whether provincial, municipal, or federal taxes. Now we will be asking them to pay some more for another governmental program.
We Conservatives want to see poverty eliminated in Canada if at all possible, but we also want to acknowledge the things that work.
Another witness who came to the human resource committee this week was a man named Kory Wood. He is from a little town about two hours away from my hometown in Chetwynd, B.C. He was a young guy who grew up in poverty. He did not even see himself as growing up in poverty, but just in a difficult situation. He now runs an energy company called Kikanaw that has a yearly balance sheet of $10 million.
This guy says he is not in it for the money, but to make a difference. He is a guy who gives people hope, gives people jobs, but he also sees himself and a lot of those employees he is hiring, and without having a program to tell Kory what to do, he is helping people out of poverty by establishing a business.
He is an aboriginal person, but he does not want to be known for just that. He wants to be known as a businessman, but he gives people, especially in aboriginal communities close to his own, a way out of poverty. He gives them hope for the future.
I used to teach some of these kids in high school. When people do not have jobs and all they can see in the future is high unemployment, with no opportunities in sight, poverty becomes a destiny rather than something that is optional. Kory gives a person like that a way out of these circumstances, much more along the lines of a Conservative real-life approach, a real way out of poverty.
To summarize, bureaucracies are fine and bills like this are fine and sound great. They establish things that sound great to people, but I am concerned about poor people being really affected by this, and I see it as a limited thing. Just having another policy will have very limited success.
However, I am really concerned about Jane and Joe Taxpayer who bear the burden of one more governmental programs, one more tax that pushes them closer and closer to poverty.
Although I acknowledge the hon. member's best intentions in putting the bill forward, and I think we all agree that we want to see people come out of poverty, we just do not think this is the right direction. We want to see actions that really take effect and really do provide a pathway out of poverty.
View Brad Trost Profile
CPC (SK)
View Brad Trost Profile
2016-11-28 16:28 [p.7328]
Mr. Speaker, it is a privilege to speak in this debate and discussion on the CPP, something which affects almost all Canadians. I spoke to this bill at second reading, and it is interesting to see at report stage how the debate has gone forward, or in some cases not gone forward.
Before I get to the main body of my speech, I want to deal with an issue that the parliamentary secretary has continuously repeated, that all of the provinces have come onside to support this change, and citing the Conservative premiers, of which there are very few. It should be noted that the premier of my province, Mr. Brad Wall, said very clearly that the reason he was backing this was because he was concerned that a worse agreement was going to be put in place. This was not exactly a ringing endorsement.
As he said, he was more concerned that a more aggressive Ontario Liberal plan would be put in place. He signed on to the Liberals' changes, not because he thought it was a good idea, but to prevent something worse from happening. When someone endorses something because the person fears the government will do something worse, I do not know if the government can honestly claim that as a ringing endorsement, as was presented to the House. I wanted to note that. I am sure the parliamentary secretary will address that in questions and comments.
When looking at the overlying issue with the CPP, the Conservative Party has objections to it, and the government is pushing it forward. The reasoning is very similar on both sides, but comes to very different conclusions. The government is arguing that for the cost of living and people's retirement, this is a good bill. The Liberals are saying that the cost of living for seniors is too high and it is difficult for them to make ends meet. It is difficult for seniors to make a living, so we therefore need to make these changes so that future seniors should benefit.
Interestingly, we in the opposition, in some respects, are arguing a similar issue. The cost of living makes it difficult, and people need every cent they can get. The Conservative Party is arguing that people should be allowed to keep doing what they are currently doing with their funds and decide for themselves what they should do with their money. As has been noted, this could end up being an $1,100 hit for the average person, assuming the average person pays the maximum. While, for some people, $1,100 a year is not significant, for people whose budgets are tight, that is very significant.
As has been noted frequently in debate, there are studies by the Fraser Institute and other institutions that have noted that almost all of the increased premiums will come from savings. However, some of it will come from consumption. One way or the other, Canadians have a problem. They have a problem because they do not have enough money to pay for their necessities of life, now or in the future. Every circumstance is different, but this needs to be noted.
We are not dealing with abstracts for people at the high end of the income scale, and, frankly, this does not target people at the really low end of the income scale, because the OAS, and particularly the GIS, are used to deal with that. That is how the current Liberal government and past Conservative governments have dealt with the issue of poverty. The CPP deals more with middle-class Canadians, the broad swath, the centre, economically and socially, of our society, and their cost of living.
The question we are really debating here today is how we can make things more affordable for Canadians now and in the future. How can we make things more affordable and create a better standard of living for Canadians in the present, in the future, and in retirement? This needs to be underlined in this whole debate. The largest cost for all Canadians across the board is taxes. In Canada, over 40% of our GDP ends up getting sucked up into taxes. That is the size of it when we put everything together.
One of the reasons why seniors are struggling and having a difficult time today and why the Liberals are arguing that they need increased CPP benefits in the future is because we continually have taxes that are too high. The Liberals like to talk about the one element of tax changes that was positive in their budget, but they do not talk about the positive tax changes from the previous government that they eliminated: income splitting and assistance to families. Parents with children is one particular group that is going to be under fiscal pressure due to these changes with the CPP.
Just think about when in life people have the greatest expenses. When is the time that they have a mortgage? It is also a time that they frequently have their children. People's children are growing up, spending more money, wanting to do sports, and to do things with their schoolmates. Those are the years when people are trying to earn their peak amount of money. It is not their retirement, but their earning years.
Along came the Liberal government. First it eliminated income splitting, which was again a policy that benefited Canadians at the middle of the spectrum of our society. Most Canadians, depending on where they are in life, would have benefited from that for a good portion of their life because we know that as they go through their lives they are all in different income strata for different seasons.
When they are students they are technically very poor, maybe living in their parents' basement. Most of their income may go to pay for tuition, but they get by. They are considered poor.
The years when people are paying the maximum in CPP premiums are often when they have the greatest expenses. They need to take care of their house. They perhaps have parents to take care of. Generally that is when they have children. This is when the government again is coming after people with tax hikes and, as I noted earlier, the elimination of income splitting.
That is why we in the opposition have been referring to the CPP hike as a tax hike. It would take money directly from people, reduce their freedom, reduce their choice in what they could do with it, and give them a worse rate of return than they would otherwise have if they had invested it in private savings plans. This is something that has been documented by researchers looking at this.
For my grandpa, the CPP was a marvellous investment. He paid into it for practically the minimum number of years, and since he lived to be 92 years old he collected well above the average amount. It was fantastic, better than a 20-some per cent rate of return, which was the average for people. He made way more on his investment than he could have anywhere else.
But for people of my age, a generation Xer born in 1974 and younger, the rate of return after inflation for CPP that is invested is barely 2%. That is horrendous. People could do better. That is why we are referring to it as a tax. The government takes the money and people ultimately lose money. It drives up their cost of living.
What could people be using this money for if the Liberals were not taking it away? Electricity prices are going up, in many cases due to the wrong-headed environmental policies of federal and provincial governments. Property taxes are going up, again something that often hits people in their prime earning years with children and families the most. Inflation and various other expenses are all going up. Here we are, taking away more of people's money.
The basic argument is this. If the government is taking money away from people, not returning to them the amount that they should have and could have earned had they been able to invest and control their money privately, it is definitely a tax hike, because what people are doing with this money is subsidizing the government. It allows the government to get away with lower OAS premiums. It allows pension plans that are integrated with the CPP to get away with lower premiums. People are losing money. That is why it is a tax hike. It is a tax hike that raises people's standard of living and, as has been noted, taxes are the most expensive thing that we have to deal with in our society.
That is why I and my fellow Conservatives oppose this bill. It is the wrong policy for Canadians. It is a bad investment. It takes money out of people's pockets. That is why we as Conservatives are opposing it.
View Bill Morneau Profile
Lib. (ON)
View Bill Morneau Profile
2016-10-21 10:07 [p.5953]
moved that Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, be read the second time and referred to a committee.
He said: Madam Speaker, as hon. members know, a stronger Canada pension plan was a key part of the promise we made to Canadians when we promised to help the middle class and those working hard to join it.
On June 20 in Vancouver, we delivered. Canada's governments agreed to enhance the Canada pension plan to give Canadians a more generous public pension that will help them retire in dignity. I would like to think that we showed everyone just how well our country can work when our governments work together, even in the face of tough challenges. We worked through our differences, never wavering on our commitment to the people we serve. In doing so, we proved that collaboration around the federal-provincial-territorial tables can deliver results.
I would like to thank each and every one of my provincial and territorial counterparts for the hard work, diligence, foresight, and principled co-operation they displayed in reaching this historic agreement on behalf of Canadians.
Now that all nine CPP-participating provinces have fully confirmed their support for implementing the Vancouver agreement, we have the obligation to carefully consider the legislation before us today, which will help make this agreement a reality. We must do so with the full understanding of what is at stake: no less than the opportunity to provide future generations of Canadians with a more generous public pension in their retirement years.
A secure and dignified retirement is certainly a top priority for hard-working Canadians. We know that middle-class Canadians are working harder than ever, and many of them are worried about not having saved enough by the time they retire.
The more time we spend knocking on doors, holding forums, and talking to people in the course of our work, the clearer that becomes. We also know that young Canadians in particular, few of whom can expect to have jobs that offer a workplace pension plan, find it challenging to save enough money for retirement.
Toronto high school students aired these concerns during an open forum with me earlier this month. Their concerns are legitimate. In-depth studies by the Department of Finance and provincial governments show that one-quarter of families approaching retirement, 1.1 million families, expect their standard of living to drop significantly in retirement.
Middle-class families without workplace pension plans are at higher risk of not saving enough for retirement. One-third of those families are at risk.
Canada's finance ministers agreed with this conclusion in working towards our agreed upon enhancement to the CPP. We have developed a carefully targeted approach, which is reflected in the legislation we have before us today. Taken together, it is a comprehensive package that will increase CPP benefits while striking an appropriate balance between short-term economic considerations and longer-term gains.
What does a stronger CPP mean for Canadians?
First and foremost, it means there will be more money from the CPP waiting for Canadians when they retire. This means that they will be able to focus on the things that matter, like spending time with their family rather than worrying about making ends meet.
Once fully in place, the CPP enhancement will increase the maximum CPP retirement benefit by about 50%. The current maximum benefit is $13,110. In today's dollar terms, the enhanced CPP represents an increase of nearly $7,000, to a maximum benefit of nearly $20,000.
The enhancement we agreed upon does two things to make this happen for contributors. First, it will increase the share of annual earnings received during retirement, from one-quarter to one-third. This means that an individual making $50,000 a year in today's dollars over their working life will receive about $16,000 per year in retirement, instead of roughly $12,000 today. Second, it will increase by 14% the maximum income range covered by the CPP so that those who earn more will receive more in retirement.
The positive impact of these changes will be significant. They will meaningfully reduce the share of families at risk of not saving enough for retirement, as well as the degree of under-saving. The Department of Finance has estimated that strengthening the CPP will reduce the share of families at risk of not having adequate retirement savings by about one-quarter, from 24% to 18%, when considering income from the three pillars of the retirement income system and savings from other financial and non-financial assets.
A stronger CPP is also the right tool at the right time to improve the retirement income security of younger workers. It is an opportunity for today's hard-working Canadians to give their children, their grandchildren, and future generations a more secure retirement.
The Department of Finance has concluded that retiring in comfort will be even more a challenge for these future generations. That is, in part, because they are expected to live longer than previous generations. Also, if current trends continue, younger Canadians will be less likely than previous generations to work in jobs with retirement benefits that are paid for by their employers, and if the current low interest rate environment persists, their savings may also grow more slowly than previous generations.
In the face of these challenges, our government decided to do what Canadians do best when faced with a problem: we worked together. We worked with the provinces and territories and agreed to strengthen the Canada pension plan so that there will be more money waiting for future generations of Canadians when they retire.
However, that is not all. The legislation we are debating today also includes enrichments to CPP disability and survivor benefits. For most Canadians, all of these increased CPP benefits will come from only a 1% increase in contribution rates.
We are making sure to give individuals and their employers plenty of time to adjust to the modest increase, making sure that it is small, gradual, and starting in 2019. For example, an individual with earnings of $54,900 will contribute about $6 more a month in 2019. By the end of the seven-year phase-in period, contributions for that individual would be about $43 more per month. Furthermore, because new employees' CPP contributions will be tax deductible, as opposed to being eligible for a tax credit, Canadians will not experience an increase in tax with registered retirement savings plan or employee pension plan contributions, which are deductible and are reduced in response to this increase in CPP contributions.
Today's legislation, as agreed upon with the provinces, will also ensure that low-income Canadians are not financially burdened as a result of the extra contributions. It will do so by enhancing the working income tax benefit to roughly offset incremental CPP contributions, leaving eligible low-income Canadians with little to no change in disposal income while still securing higher retirement income for them. Taken together, these tax measures will account for $970 million in federal fiscal support in 2021-22.
Under the circumstances, it is clear that an enhanced Canada pension plan will help all Canadians, which will in turn help Canada's economy as a whole. With higher retirement benefits flowing from an enhanced CPP, retirees will have more money to spend on things such as healthy food, transportation, and housing costs. The knock-on effect of that? New jobs and a stronger middle class.
As I noted earlier, the Department of Finance undertook extensive research on the impact of a strengthened CPP. This analysis included a rigorous study of the potential economic impacts of the various enhancement scenarios being discussed with the provinces.
Our research found that over the long term, greater CPP benefits will boost demand and increase savings overall. This will boost economic output and make more money available for investment. As a result, it is estimated that gross domestic product will increase by between 0.05% to 0.09% over the long term. Employment levels are also projected to be permanently higher, by about 0.03% to 0.06%, equivalent to about 6,000 to 11,000 jobs based on 2015 levels of employment.
We can see from all of these facts that a stronger CPP would be good for Canadians and good for the overall economy. This should come as no surprise, since the CPP is a good and solid program. For over 50 years, the CPP has been helping to ensure that all workers in Canada have a minimum level of financial security in retirement. The most recent statistics tell us that 5.2 million people in Canada received $37.3 billion in benefits from the CPP.
According to a report by the Conference Board of Canada, poverty rates among Canadian seniors have fallen by 25% over the past four decades, dropping from 36.9% in 1976 to 12.3% in 2010. The Conference Board of Canada concluded that this significant reduction can be largely attributed to the implementation of the CPP and, in Quebec, the QPP.
The CPP Investment Board is similarly well-regarded around the world for its impressive record of investment performance and management excellence. The CPPIB operates at arm's length from governments, with a mandate to invest CPP funds in the best interests of plan members. It has been acclaimed by international bodies such as the World Bank as the model of an independent, transparent, and accountable public pension fund management organization.
As the manager of a large fund program with millions of contributors, the CPP Investment Board is able to take advantage of economies of scale to deliver strong net returns. Over the past 10 years, the CPPIB has delivered a 10-year average nominal rate of return of 6.8% on existing CPP assets. This is above the 6.1% nominal rate of return identified by the chief actuary of Canada as necessary to ensure the sustainability of the Canada Pension Plan.
With this rock-solid investment structure as its foundation, the CPP provides a safe, secure, and predictable benefit, which means that Canadians can worry less about outliving their savings or having their savings impacted by significant market downturns. The recently released 27th actuarial report on the Canada pension plan concludes that the existing CPP is on a sustainable financial footing, at its current contribution rate of 9.9%, for at least the next 75 years.
Bill C-26 would make amendments to the Canada Pension Plan Investment Board Act to make the CPPIB the manager of the improved CPP. Now that Bill C-26 is before us for consideration in Parliament, the chief actuary will conduct an actuarial assessment of the enhancement to ensure that it is on a sustainable, long-term financial footing.
CPP benefits are also fully indexed to prices, which reduces the risk that inflation will gradually erode the purchasing power of retirement savings. As well, the CPP is a good fit for Canada's changing job market. It helps to fill the gap left by declining workplace pension coverage and it is portable across jobs and provinces, which promotes labour mobility and reflects how Canadians currently live, work, and retire. With the automatic collection of contributions for all workers, the CPP is a simple way to save for retirement. It also provides important income support through disability, death, survivor, children's, and post-retirement benefits for eligible contributors and their families.
By supporting today's legislation, parliamentarians will not only be boosting how much each Canadian will get from his or her CPP pension in the future, we will be making a great program even greater. With 75% of Canadians in support of a stronger CPP, members will be acting on one of the highest priorities of Canadians.
I am honoured to have been able to work with our provincial and territorial partners to make an enhanced Canada pension plan a reality for Canadians. I encourage my colleagues to share in this success by supporting Bill C-26.
View Bruce Stanton Profile
CPC (ON)

Question No. 104--
Mr. James Bezan:
With regard to the $3.716 billion for large-scale capital projects that was reallocated from 2015-2016 to 2020-2021: (a) has the government earmarked this money for specific projects, and, if so, to which projects will this funding reallocation be applied; (b) for each project that had its funding reallocated to 2020-2021, what is the anticipated average annual inflation cost of each project for the next five years; (c) based on calculations from (b), how does the government anticipate that inflation costs will impact the government’s buying power; and (d) are additional funds being set aside in the fiscal framework to account for schedule slippage as a result of the reallocation of $3.716 billion?
Response
(Return tabled)

Question No. 106--
Mr. Chris Warkentin:
With regard to the upcoming agricultural policy framework replacing the current Growing Forward 2 framework, and the ongoing consultations being held in preparation of the agreement: (a) what information, including all the details of documents and correspondence, has the Minister of Agriculture, his staff, or the department of Agriculture and Agri-food Canada shared with, or received from, their provincial counterparts; (b) what information, including all the details of documents and correspondence, has been exchanged between the Minister of Agriculture and the Minister of Finance or their ministerial offices, and between the Department of Agriculture and Agri-food Canada and Finance Canada; and (c) what information, including the details of all documents and correspondence, has been exchanged between the Minister of Agriculture and the Minister of Environment and Climate Change or their ministerial offices, and between the Department of Agriculture and Agri-food Canada and the Department of Environment and Climate Change Canada?
Response
(Return tabled)
View Andrew Scheer Profile
CPC (SK)
View Andrew Scheer Profile
2016-03-07 13:54 [p.1494]
Mr. Speaker, I would like to congratulate my seatmate on an excellent analysis of why Bill C-2 is so flawed and why the previous government's economic record was so good. The member has a lot of material to work with.
I am sure that members, at least on this side of the House, will be familiar with the last two “Fiscal Monitor” releases, which showed that the Conservative government left the Liberals with a surplus. At the time the Liberals took over, the Government of Canada was running a surplus. We know there will be a deficit and that this deficit will be a direct result of the choices the Liberal Party has made, and not because of anything the previous government did, because we left the books in such great shape.
The tail end of my colleague's speech centred on the tax-free savings account, and I would like to speak to that as well.
Canada used to have a lifetime capital gains exemption. I believe at the time it was phased out by a previous government, it was a $500,000 in lifetime capital gains. It meant that any Canadian could buy and sell shares, equities, or investment real estate properties, and when they sold, a good chunk of it would be tax-free, and there were a lot of reasons for that.
There is a huge economic incentive to protect capital gains in that way, and the first aspect I would like to touch on is the idea that inflation is a tax.
When one has a capital gain, a good chunk of that notional gain is due to inflation. In other words, if I buy $100 worth of equities today and 20 years from now they have gone up 20%, when I sell them, I have to pay taxes on that gain even though a good chunk of that has been the normal inflation that the Bank of Canada actively seeks with its mandate to achieve a 2% inflation target. Therefore, the $120 that I sold the equities for is not really $120, because a good chunk of the value of it has been eaten away by inflation, but I still pay the taxes as if I had the benefit of the entire 20%.
What the tax-free savings account does, of course, is protect all of the growth, both inflation and real growth, from the tax man. Therefore, if I have equities in a tax-free savings account and it does go up by 20% over a period of time, then, yes, a good chunk of that is inflation, fake growth and not real, a kind of a tax and devaluation of something that I own, but it is protected at the very least from paying taxes.
Ordinary Canadians cannot protect themselves from inflation. It is a tool of government, a tool of the Bank of Canada, and it is done for many different reasons.
There is some debate as to the benefits of having an inflation target, but nonetheless ordinary Canadians can do nothing about it. They can try to protect themselves in terms of where they put their money, they can try to find investments that offer some kind of predictable return, but they cannot control what the folks at the Bank of Canada do, and it in turn certainly cannot control the mandate it is given by the government. However, the tax-free savings account, at the very least, offered a little bit of a shelter against the negative impacts of inflation when it comes to paying taxes, as one would not have to pay tax on that fake growth.
Mr. Speaker, I see we are approaching statements by members.
View Andrew Scheer Profile
CPC (SK)
View Andrew Scheer Profile
2016-03-07 15:15 [p.1508]
Mr. Speaker, before question period started, I had just finished explaining how inflation acted as a tax on ordinary Canadians and that when the government imposed an inflation target, as Canada has, of 2%, that it slowly but surely would eat away at the value of what Canadians had saved. It lets the government off the hook because the liability today to a group, whether that be individuals or other entities, gets eaten away by inflation as the money they end up having to pay back over time is reduced because of the inflationary acts of the central bank policy.
However, I want to shift gears a bit and talk about how savings can be a stimulus. When it comes to economic times, we hear these buzz words of liquidity traps, dead cash, and all these kinds of phantom problems about which we should be concerned. A lot of people have a misconception about what happens when Canadians save money.
When individuals put money into a tax-free savings account, that does not go into a mattress or become dead money. Rather, it gets invested into the market. It becomes capital that businesses and individuals can tap into to expand operations, to invest in new equipment and capital expenditures for their business. It becomes real loanable funds, not the loanable funds the government creates out of thin air through deficit financing or the modern day alchemy like we see in Europe and the United States with quantitative easing, and these types of new monetary tools that many governments around the world have experienced.
It strikes me on how history repeats itself. We hear stories in history books and legends of kings and queens commanding the wizards and astronomers of the day to try to turn lead into gold. We call them alchemists. They used to get the support of the monarchy in the area to take something of no value and turn it into something of great value. The most common example is the practice of alchemy and trying to turn lead into gold. We always see governments around the world doing that with monetary policy, such as quantitative easing, and that somehow printing more dollar bills will improve the economy. We know that is false. Thankfully, under the previous government, we refused to go down that road and engage in that type of trickery.
However, real savings, which is real individuals putting money into investment vehicles, such as a tax-free savings account, mutual funds or bonds, is real capital. That is something tangible. Savings today become a stimulus tomorrow because they are real funds that are there. That is what our economic policy was all about when our party was in power, encouraging private sector stimulus.
As we lead up to the record deficits that we know are coming in the next budget, we have been hearing a lot from the Liberals in the last few days on how we need to stimulate the economy and that the only thing that can do that is government spending. We hear time and again from the parliamentary secretary and from the Minister of Finance, who should know better having been on Bay Street before, that somehow if the government could just spend the right amount of money, we would get back to big growth again. This is the problem we are facing. We hear from the other side that the government was not spending enough money. We can look back over the decades to budget documents.
As an aside, I know the Liberals do not like reading budget documents or Finance Canada reports because they show we left them with a surplus. It is becoming quite clear that the only people who do not believe the government was left a surplus are the Liberals themselves.
With respect to private sector stimulus, I want to point to a couple of examples. The first is the energy east pipeline, which is a $15 billion private sector stimulus package that does not require a cent of taxpayer money and will put people to work because there is a market solution, there is a business case for it. We know there is a business case for it. If there were not, the company would not propose it.
A similar example would be the Toronto Island airport. My friend from Spadina—Fort York cares very passionately about this because he represents a lot of very rich condo dwellers in downtown Toronto who do not want the inconvenience of jets landing and spoiling their waterfront view as they wake up in the morning and drink their fancy coffee.
Meanwhile, people in Montreal who work in the aerospace industry have their jobs threatened because there is no ability for the airlines to buy those jets and land them at the airport. This is a classic Liberal example of putting up a wall, blocking an economic stimulant like energy east or the Toronto Island airport, and then coming along with taxpayers' dollars and saying, “Don't worry; we'll bail out the company” or “Don't worry; we'll expand EI benefits for all those people who are out of work for a long period of time.”
That is the difference between the economic approaches of the two parties. On this side of the House, we want the private sector to provide that stimulus. We want to get the government out of the way. We want to tear down those walls that prevent innovation and investment, and allow the market to do what it does best, and that is to allocate resources, make those investments, and get people back to work. We do not think the government should cause the problem in the first place and then come along with a solution that always, invariably, just results in more taxpayers' dollars being spent.
View Alistair MacGregor Profile
NDP (BC)
Madam Speaker, I would like to thank the hon. member for Skeena—Bulkley Valley. He has done an amazing job in the House since 2004 on behalf of his constituents, and I will certainly do my best to follow such an amazing performance.
It is an honour to rise again in the House to speak on behalf of my wonderful constituents in Cowichan—Malahat—Langford and to take part in the debate on Bill C-2, An Act to amend the Income Tax Act. As we all know, this bill would make various changes to the Income Tax Act, but today I will concentrate on two of them: the changes to the income tax brackets and to the contribution limit to the tax-free savings account.
The Liberals were elected on the promise of bringing tax relief to the “middle class”. Indeed, the words from the Liberals' campaign website painted a cozy picture for the average middle-class Canadian. Let me just read some of the words: “We will give middle class Canadians a tax break, by making taxes more fair. When middle class Canadians have more money in their pockets to save, invest, and grow the economy, we all benefit”.
It sounds pretty rosy.
Before I get to the crux of the matter with the tax changes, I want to speak first about the tax-free savings account because this is on something that the NDP can agree on with the Liberal Party.
When the Conservatives were in power, we heard time and again that the TFSA was an excellent tool for helping seniors. I know very well from hearing from seniors across my riding that the TFSA contribution limit would be of little help compared to many of the NDP's proposals. It was a step in the right direction to lower the TFSA contribution limit placed by the Conservatives, because the higher limit yields disproportionate benefits to the richest Canadians. The TFSA contribution limit increase would have cost the treasury billions of dollars in the decades to come. In fact, it is estimated that the combined federal–provincial cost would have been $132 billion by the year 2080. Where is that money going to be recouped?
We know that the Conservatives' responses included the point that it was not a problem for the previous prime minister's grandchildren. We heard Joe Oliver's comments on that mentioned in the last speech. However, we in the NDP believe in creating a sustainable future where no one is left behind. The problem lies in what we have seen through many Liberal governments in the past. They acted on some small measures but really did nothing to deal with the issues that middle- and working-class Canadians face. Presently, we are dealing with a very difficult economy. There are lay-offs and the power of our dollar has been shrinking by the week. This is making our already-precarious seniors' living and food insecurity even more insecure.
Now I will speak to the matter that I am looking forward to addressing, the so-called middle-class tax cut.
The Liberals have decided not to use their first piece of legislation, Bill C-2, to deal with our ruined economy but to propose lowering taxes in a way that would not benefit 60% of Canadians. In my riding, if someone earns the average income of $37,000 a year, he or she would receive precisely zero dollars in benefits. We know that the price of vegetables has gone up by 10% in the last year and we have seen a report from the University of Guelph that predicts that food prices will again rise faster than inflation. This price of food disproportionately affects the most vulnerable Canadians and is something that hurts the real middle class in this country. The seniors and indigenous people in my riding are some of the most adversely affected by this drastic price increase. If we get to the people who are lucky enough to get into the middle-class tax bracket, the maximum benefit that many of them would see, as alluded to earlier, is precisely $50. That figure is negated when we take into account the cost of inflation. In fact, that $50 would basically be eaten up by five stalks of cauliflower over the year at the supermarket with the way food prices are going.
It is important for us to point out the contrasts here today. I want to show members some of the figures that we have from Statistics Canada: for the average office worker earning $39,000 a year, the benefit would be zero dollars; for hairstylists earning an average of $27,000, zero dollars; and even the fish plant worker earning $26,000 a year, it would be zero dollars. However, I do want every Liberal member of Parliament to understand they are giving themselves a tax break of $679. Moreover, every parliamentary secretary on the government side is giving themselves a tax break of $679. They are doing it for lawyers, well-paid bankers, and so on. However, for the average middle-class Canadians, they will get precisely zero dollars under the bill.
We have a constituency week coming up next week when we will all get to travel back to our ridings and meet with our communities, which I am very much looking forward to. However, I would love to see how Liberal members of Parliament will explain to the so-called common folk in their riding, the middle-class Canadians, what the real deal is with their tax break, and how they are giving themselves $679 in tax breaks, but for the rest of the people in the riding, precisely zero or $50.
This middle-class tax cut is nothing more than smoke and mirrors. The Liberals have never been able to define precisely what the middle class is, and they have never answered the question. The median income, defined as the halfway point between the higher half of a data sample and the lower half, and probably a good place to define the middle class, is $31,000. However, this group will receive precisely zero dollars.
On the proposal for middle-class tax cuts, the legislation before us would work for families that make between $166,000 to $200,000. They fall among the richest 90% to 95% of Canadians. I believe this action seems to suggest that either the Liberals are not here to help the real middle class or they believe the middle class is people earning the 90th percentile of income.
The cost of helping such a small portion of the richest Canadians will exert an incredible amount of pressure on the government's books. In fact, it is estimated that this tax cut overall will cost our revenue stream $8.9 billion over the next six years. This plan was a piece of election hyperbole that was meant to seem progressive, but is actually detrimental to our middle and working classes.
Liberal governments of the past have been able to flash left and then turn right while they were in power. We in the NDP do not intend to let the Liberals get by without a struggle on that front.
This change is not the way we take care of our most vulnerable population like seniors, let alone the actual middle class. This is not the change that our most vulnerable citizens were looking for.
The NDP is here not just to point out the inconsistencies in the Liberal plan, but to propose alternatives. We will be doing so here and in committee. A progressive opposition will stand for the values of fairness for all instead of an economy rigged for the highest earners. We believe in helping the real middle class, and not just the high-income earners that the Liberals have labelled as the middle class.
We have developed proposals that will fix the Liberal plan, which would make it correspond with their campaign promise to Canadians. We believe that if we lowered the first income tax bracket by 1%, then 83% of taxpayers would benefit from this proposal. This solution would benefit many more Canadians, and the cost difference would be minimal.
We could further minimize the cost to the treasury if Liberals would just agree with the NDP to increase corporate tax rates by just a smidgen more, and ask corporations to pay a little more of their fair share instead of downloading costs onto Canadians.
I will end my speech by quoting a few validators who have studied the bill.
According to the research chair in Taxation and Public Finance at the University of Sherbrooke, couples with a combined income of $250,000 a year would gain about $1,100 in tax cuts, while couples with a combined income of $75,000 a year would get an average of zero to $4.
Finally, Gordon Pape, certainly no friend of the NDP, wrote the following in The Globe and Mail:
Finally, let's consider low-income earners. There are a lot more of them than those who fall into the middle-income category.... The Liberals didn't offer them any relief so the only break they get is from the indexing of the tax brackets.
Pape continues that they “are the ones that really could have used a tax cut but somehow they got lost in the election hyperbole. Too bad.”
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