Hon. Donald M. Fleming (Minister of Finance):
Mr. Speaker, I beg leave to table the main estimates for the fiscal year 1959-60. Following the example set by my predecessor, Mr. Abbott, in 1950, 1951 and 1954 I propose to make a statement to the house now for the purpose of drawing to the attention of hon. members certain significant features of these estimates.
The most noteworthy feature is that compared with those for the present year, 195859, these estimates provide for a decrease of $39.1 million in the non-statutory items. This decrease reverses a trend of some years' duration. I am glad to report to the house that although this reduction was not accomplished without painstaking effort it has been achieved without any reduction in essential services to the public.
The second significant feature of these estimates is that the government has maintained the level of expenditure designed to assist national development and employment opportunities. Thus it may be seen that in its approach to the financial requirements in the fiscal year commencing April 1 next the government has endeavoured to maintain and foster a high degree of economic activity on the one hand and to exercise the restraint and balance necessary in coping with the inflationary aspects of recovery on the other hand.
Total budgetary expenses contemplated in the estimates for the new fiscal year amount to $5,595,848,557. This total, which includes both expenditures already authorized by continuing statutes and moneys parliament is being asked to appropriate, is compared in the blue book with a total of $5,295.6 million which was the sum provided for in the main, supplementary and further supplementary estimates No. 1 for the current year. Since the main estimates for 1959-60 were printed there have been tabled in the 66968-9-45
house further supplementary estimates No. 2, providing for additional expenditures in the present fiscal year of $28 million, so that the comparable total for 1958-59 now becomes $5,323.6 million, resulting in an over-all increase of $272.2 million. These figures do not include amounts for deficits in the old age security fund, since it is the practice to make such provision in the final supplementary estimates.
The government's approach to the task of preparing the 1959-60 estimates may be of interest to the house. Last year in order to provide employment the government deliberately favoured expenditure which would provide work through construction programs of a capital nature. This year we have expedited and encouraged programs which will provide work this winter. But we have been careful to ensure that we do not add to or extend a program which would build up government overhead without creating immediate employment. On all other items in the estimates our aim has been to apply a firm hand in restraining controllable expenditure without sacrificing essential public services.
There is an increase of $311.3 million in the estimates in the statutory area. It is attributable substantially to two or three items. First is the sum of $160 million for payments to the provinces under the Hospital Insurance and Diagnostic Services Act. The second is an increase of $106 million for statutory public debt charges. This increase may be attributed in approximately equal measure to the increase in the total public debt outstanding and higher rates of interest. In the third place is an increase of $25 million for family allowances, due to the increase in the numbers of those eligible, and $9 million for unemployment assistance attributable to the expected lag in the settlement of claims relating to the current fiscal year.
The over-all decrease of $39.1 million in the non-statutory items was achieved in spite of an increase of $88 million in the cost of administration and operation of all departments. This increase of $88 million is attributable to four items: first, an increase of $20 million in civil salaries and wages; second, an increase of $22 million in the pay and allowances of the armed forces and the Royal Canadian Mounted Police; third, an increase of $19 million in the cost of repairs and upkeep of equipment; and
Tabling of Main Estimates fourth, smaller increases spread over a number of other items due principally to rising costs.
Notwithstanding the increases of $42 million in salaries and wages and pay and allowances, there has been no appreciable expansion in the strength of the civil service of Canada or of the defence forces. While additional responsibilities have been assumed, the overall increase in the size of the government establishment for 1959-60 will be only .4 per cent over 1958-59. This is the smallest annual growth shown since 1951. It demonstrates the government's continuing effort to increase efficiency and at the same time to economize on the use of staff.
The principal factor in the increases in expenditures for administration is the fact that, in addition to the normal effect of reclassification and annual increases, there has been a continuation of the trend toward improved recruiting into the public service and armed forces, and toward lower rates of turnover within the authorized establishment. This has been particularly noticeable in relation to technical and professional grades which are being attracted into the public service within the approved staff strength.
The third factor, namely $19 million for repairs and upkeep of equipment, reflects an intensification of government programs of maintenance and repair.
Another factor contributing to the increased cost of administration is an amount of $8.9 million for travel and removal expenses, notably in national defence. Expenditures under this head are higher in certain years to meet the requirements for larger scale movement of forces. In the forthcoming year a large part of the brigade will be replaced in Europe in the normal rotation pattern.
The capital program reveals an over-all decrease in contemplated expenditure of $65 million. However, it is anticipated that the level of capital expenditure achieved in the current year by most of the civil departments will be maintained, particularly in those areas where expenditures are related to resource development and to employment, such as the departments of agriculture, mines and technical surveys, and northern affairs and national resources. The capital provision for the Department of Public Works is reduced in consequence of the accelerated completion of many public buildings and the inevitable time lag in the completion of plans for new projects. The provision in the Department of Transport, however, will remain at the present high level which has been established to meet the urgent requirements of civil aviation. The decline in the capital program of the public works department is largely offset
by the provisions for the Department of Transport. Thus the government is maintaining a high volume of national works to continue the battle against unemployment.
The requirements of the Department of National Defence on capital account are also reduced. Expenditures in this area, apart from new requirements, are governed by the progress of various long-term defence projects.
Parliament is being asked to provide for loans, investments and advances-which add to the government's active assets-totalling $122,887,799 in addition to those for which continuing authority exists.
Not included in the figures I have thus far mentioned, but noted in the volume of estimates for consideration, are the forecast amounts for old age security pension payments totalling $577,600,000. These payments are not treated as budgetary expenditures since they are payable out of the old age security fund.
The house will see that in planning its spending program for 1959-60 the government sought, within the limits of controllable expenditure, to restrain inflation while at the same time assisting employment and the development of resources.
Mr. Speaker, I move, seconded by the Minister of Trade and Commerce (Mr. Churchill):
That the message of His Excellency, together with the estimates presented this day, be referred to the committee of supply.