March 20, 2000

REF

Diane Ablonczy

Reform

Mrs. Diane Ablonczy (Calgary—Nose Hill, Ref.)

moved:

That this House calls on the Minister of Finance to increase the Canada Health and Social Transfer by $1.5 billion and forgo the $1.5 billion increase to federal grants and contributions in this year's federal budget.

Mr. Speaker, it is a pleasure to introduce this motion to the House this morning.

I would like to advise the Chair that I will be splitting my time with my colleague from Calgary East.

The motion before us today is very simple. It is a very small first step that the government could take today to put its money where its mouth is on the health care issue.

The issue is simple. The motion states that the finance minister be directed to cancel the additional money that he gave to grants and contributions in the last budget and instead put that money into health care.

We are talking about $1.5 billion. The government at this point spends over $13 billion on grants and contributions. The finance minister increased that in this budget by $1.5 billion. We are saying that over $13 billion is plenty at this point for the government to spend on grants and contributions, particularly in light of its very uninspiring track record at mismanaging these moneys.

We are saying that, instead, this additional $1.5 billion, topping up the $13 billion already going into grants and contributions, should be put into our ailing health care system.

This is a very reasonable motion and it is a very small step that the government could take on the issue of health care.

I will first talk about the government's shocking record of mismanagement on grants and contributions. Of course, we know about the record of the human resources department, which spends over $3 billion in grants and contributions a year.

A recent audit revealed that the government was so lax in managing this enormous amount of money that in 46% of the cases there was no estimate on who would be participating in the projects that were funded. In 72% of the cases there was no cash flow forecast. In 80% of the cases there was no evidence of financial monitoring. In 87% of the cases there was no evidence of supervision of the projects. In 97% of the cases there was no evidence that anyone had checked on the background and what money might be owed by the recipients of the grants.

Let us look at an audit that was done of the transitional jobs fund, just one of the programs that is being funded by the government. That audit showed that, of the private sector partners interviewed in the survey, 47% said their projects would have gone ahead without TJF funding. Almost half would have gone ahead anyway.

In actual numbers, putting public and private funds together, because the minister likes to talk about partnerships, all of the partners together contributed $104,000 for every new job. All of the others would have been created anyway. The jobs created were for an average of $13 an hour, which works out to $27,000 a year. It cost the government $104,000 to create a $27,000 job. Go figure. At the same time our health care system is going begging for funding from this government.

The survey added: “The sustainable results must be treated with caution. The estimates are still based on mere expectations, not real experiences”.

In other words, these jobs that cost $104,000 each to create are not even, for sure, long term. They may disappear shortly.

Let us look at an audit of the Atlantic groundfish strategy, which spent billions of dollars. The April 1999 report of the auditor general stated: “We have little assurance that all contributions under the Atlantic groundfish strategy were used for their intended purposes. These were part of TAGS active labour adjustment measures, which were managed, or shall we say mismanaged, by Human Resources Development Canada”.

Today the news is about HRDC grant cheques. Cheques for nearly $200 million of HRDC job grants were sent to destinations with missing, invalid or non-designated postal codes. In other words, our money is ending up in the hands of people who were not intended to get it because the government is so mismanaging that it cannot even get the address right on the envelope.

Another headline reads: “Misusing federal grant money”. The human resources department tells the Bloc Quebecois that it cannot have information about a grant because it is under investigation. The minister said “No, it is not under investigation”, and that same day, mysteriously, the investigation disappeared. We have to wonder why. Is there an investigation or is there not an investigation? Yet, the Prime Minister has said that anyone caught abusing money will pay for it. Investigations seem to appear and disappear like fireflies on a June night.

Another headline concerns Amtrak. The government secretly loaned $1 billion to a U.S. railroad. This is the same government that excoriates a supposed move toward American style health care. It seems quite happy to support $1 billion for an American train company, but not $1 billion for health care.

Another of today's headlines concerns the Export Development Corporation, which has loaned billions of dollars to foreign companies, of which almost $3 billion has already had to be written off. Imagine what that $3 billion which the government squandered could have done for our health care system. The government does not have money for health care, but it does have money for the Export Development Corporation so that selected companies in Canada can get sweetheart contracts. Those companies, just by the by, have been heavy supporters of the Liberal Party.

Another headline today concerns Telefilm Canada, which is heavily subsidized by the government to protect our culture against those nasty Americans. One of the companies that we have been supporting with our money, which we work for, has been fraudulently using Americans to write scripts so they can get a tax credit. This is just today's news.

Another headline concerns DND overpayments. It notes that on at least three cases the defence department paid the same bill twice.

That is the government's record of mismanaging our money, and yet the government says it has no money for health care. That just is not good enough.

Today my colleagues and I will be talking about why the government should get serious about putting money into our health care system, which it has stripped of the resources needed to keep it on an even footing. My colleagues and I will talk about the numbers, about the billions that have been stripped from our health care system by the government, while it misuses, abuses, squanders, wastes and pork barrels billions of dollars on other programs. It is not good enough and we want it stopped. We want a reversal, and that is what this motion is about today.

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LIB

Roy Cullen

Liberal

Mr. Roy Cullen (Parliamentary Secretary to Minister of Finance, Lib.)

Mr. Speaker, if my memory serves me correctly, it has been pointed out in the House that there were many grants supporting various organizations, institutions and other groups in the riding of Calgary—Nose Hill which created jobs that helped people return to the workforce, easing the transition. I just wanted to make sure that I understood her correctly. Is she saying that the administration of the grants in HRDC needs to be tightened up?

The minister has stated quite clearly that she has a plan in which the auditor general is involved and that she is coming in to clean that up. Perhaps the member could clarify what she is saying. Is she saying that all the grants and contributions which went into her riding would be part of this $1.5 billion and that she would be happy to completely cut them out?

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REF

Diane Ablonczy

Reform

Mrs. Diane Ablonczy

Mr. Speaker, what a nonsensical question. Over $13 billion are being spent by the government in grants and contributions. We have not said that we should cut a nickel of that, although a lot of people would. In addition to the $13 billion the government put another $1.5 billion into these grants programs in spite of its shocking track record of mismanagement.

We are saying that it should not put one more nickel into grants and contributions, but that money should be put into health care. The sick people of Canada are crying for support from the government, and instead the government has money for all the boondoggles and all the mismanagement of the past. It can increase that money but for health care there is only a pittance. We are saying the money that would have topped up grants and contributions should go into health care.

The member has the nerve to say that this money creates jobs. How does he know? Records have not been kept. In fact the government audits indicate that the job forecasts are not reliable because information is not available on which to rely. I ask the member not to mislead Canadian people by pretending this money has created jobs when the government's own audit says that job creation forecasts are not believable.

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NDP

Louise Hardy

New Democratic Party

Ms. Louise Hardy (Yukon, NDP)

Mr. Speaker, I was very interested in listening to the comments of the Reform Party member. What is so inexplicable and hard to understand in HRDC are the inconsistencies such as in the young entrepreneurs program in Yukon and B.C. where $300,000 were supposed to be available.

A group of volunteer businessmen got together to help young kids to do it on their own. Within a year a lot of them had jobs. They created newspapers and were involved in outfitting and guiding. They showed really advanced thinking and worked in remote communities.

This group got together and got everything up and running. They signed contracts based on the $300,000, but a month later they were told there was no money for them, that all they would actually get was $94,000. These people then had to make up the difference themselves because they were honourable and they had based their decision on what HRDC had said to them. All the information that could be brought to the officials at HRDC did not change them or move them.

This program was successful but was left in the lurch out of the blue without an explanation. I would like the member's comments on it.

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REF

Diane Ablonczy

Reform

Mrs. Diane Ablonczy

Mr. Speaker, the point is well taken. These programs have been so mismanaged and so poorly administered that even the people who were supposed to be helped are complaining bitterly about being jerked around by the improper communication and irresponsible management of the programs.

We are not asking that any of the money put into these programs be cut. We are asking for these programs to be left in place and for the money to be left in place. We should not give any more to those programs right now but the money instead should be given to health care.

The government cannot get its story straight on health care. On March 8 the Prime Minister rejected calls for health talks and told the premiers that they had to fix the system and then he would talk to them. A few days later the Prime Minister bragged about meeting with the premiers later this month. Is the government on or off? As the member said, we can never tell whether or not the government will go ahead with something. This does not give the required certainty to people who depend on the health care system.

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REF

Deepak Obhrai

Reform

Mr. Deepak Obhrai (Calgary East, Ref.)

Mr. Speaker, I am pleased to rise on behalf of the constituents of Calgary East to speak to today's Reform sponsored supply day motion. I would like to repeat the motion of my colleague from Calgary—Nose Hill so that it is very well understood.

That this House calls on the Minister of Finance to increase the Canada health and social transfer by $1.5 billion and forgo the $1.5 billion increase to federal grants and contributions in this year's federal budget.

We all know and it is no state secret that the finance minister is trying for the Prime Minister's job, but Canadians feel that health care is the number one priority. Even the Liberal pollsters stated at the convention that health care was the number one priority of the country. Partly they feel that under the Liberal government health care is in a crisis because it has cut and cut and cut its contributions to health care. At the same time it increased the HRDC grants and contributions by $1.5 billion.

Over the last few months the official opposition has showed what has gone massively wrong with the grants and contributions in HRDC, especially the transition jobs fund. We have asked the minister and the government for answers on where and how taxpayer money was spent. We did not get any credible answer.

What we got was a spectacle of stupidity. We now see that the minister of HRDC was stealing supposedly so-called jobs from the government's own Liberal MPs next door to her riding and moving them into her riding in HRDC grants. It has been quite clear that in the last two and a half months that the HRDC transitional jobs fund was a slush fund for the government to blatantly buy jobs and give an impression.

The Prime Minister said that it was his job to work for his constituency. That is fine, but he forgets he is the Prime Minister of Canada and his constituency is the whole of Canada, not only Shawinigan. How can we account for his riding of Shawinigan getting more money than Alberta, Saskatchewan and Manitoba combined? How can that be explained? Perhaps the Prime Minister should be told that he has a whole country to take care of, not just his friends.

Let us talk about Earth Canada. When we asked a question about EDC giving money to Earth Canada, which has cronies of the Prime Minister as directors, the Minister for International Trade said that it was a business decision. They are hiding behind the fact that EDC gave money to a firm that could buy services from Earth Canada. At the end of the day, after we had gone around in circles, the cronies of the Prime Minister sitting on that board had benefited from the loan, not the other companies.

We have seen an exposé on EDC. The same has happened with Amtrak. Money was given to the richest country in the world for Amtrak and we are financing it. At the end of the day it comes down to Bombardier in Montreal that will benefit from the so-called grant. Where is all this money? Somehow somewhere it points to the Prime Minister, his friends and Liberal cronies that are appointed to sit on these boards.

Canadians from one end of the country to the other are asking what is happening with the government, a government that is lacking in leadership? The pollsters have to tell the Liberals, not their own MPs who should be listening to their constituencies, that health care is the number one crisis. It is the pollsters who have to tell them. It shows how much in touch Liberals MPs are with their constituents. It is very easy. If they sit in their offices they will know what Canadians are telling them.

Why can it not be possible for the government to transfer that $1.5 billion to health care, the Canada health and social transfer?

When I was in my riding this past weekend Canadians came to the office to say that they were worried about health care. Health care is their number one priority. They are very much worried about it. The cuts the government made to health care have created a crisis. The provinces are trying their best to balance the shortfall.

On the day the Minister of Finance brought down his so-called great budget, did the government listen to the Premier of Newfoundland, Brian Tobin, a Liberal colleague? This person, who would like to be the leader of that party, came out smacking the government by saying that the health care transfer was not sufficient and there was crisis?

What do we have? We have the Minister of Finance giving $1.5 billion to grants and contributions in the federal budget so the government can feed its friends who hold all these positions. When will the government listen to Canadians? If it does not then it will end up sitting on the opposition benches.

Let us look at grants and contributions. The government says it wants to create jobs, but every economist says that taxes in the country are the number one job killer, the brain drain. A simple solution is not to throw money. That does not create jobs. Even the auditor general says so. The simple solution is to reduce taxes. That would clearly increase productivity in the country. That would be the simple solution.

What do we get from the Minister of Finance in the budget? A tax cut. I do not think it is even a modest tax cut. It is a band-aid solution. Canadian economists all stated that we should reduce taxes so that productivity would increase and Canada would rightfully go back to its position as the number one country in the world.

The official opposition has presented a 17% flat rate plan, contrary to what the Prime Minister would like to say. That would address many issues. It would put money back into the pockets of Canadians. It would put money back into the pockets of single mothers. It would put money back into the pockets of women who have decided to stay home to raise their children. That is where the money should be. At the end of the day it is the consumer who will drive the economy.

These are simple solutions, but based upon the Liberal convention last weekend we know the government is lost and without vision. At this time I would like to move the following amendment:

That the motion be amended by inserting after the words “the Minister of Finance to” the word “immediately”.

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Subtopic:   Supply
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The Deputy Speaker

The question is on the amendment.

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LIB

Murray Calder

Liberal

Mr. Murray Calder (Dufferin—Peel—Wellington—Grey, Lib.)

Mr. Speaker, I have sat here and listened with a lot of interest to the two speeches by the Reform members. My evaluation of the speeches by the members for Calgary—Nose Hill and Calgary East was that they were long on rhetoric and very short on facts. I will try to get an answer out of the member for Calgary East.

In the last budget, we transferred emergency funds to the provinces and they were to spend it. Now we find that in Quebec, for instance, it took $700 million, which was supposed to go into health care, and put it into a savings account at the TD Bank. We transferred $1.3 billion to Ontario, Mike Harris' government. It spent $750 million of it but banked $556 million, again in a savings account. Mr. Harris says he will spend every cent of it on health care.

My question for the member is how do we get the provinces to spend the money we are transferring to them on health care instead of putting it into a savings account? How do we do that?

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REF

Deepak Obhrai

Reform

Mr. Deepak Obhrai

Mr. Speaker, that is quite an interesting and valid question. I will give him that point as to why the Quebec government did not use that money.

I would like to say to the member that just after the budget someone wanting to run for his party was on television stating that the government had not put enough money into health care. Last week Brian Tobin was on television saying that the government had not put enough money into health care.

Maybe the member can tell me if he really thinks that the government has transferred enough money for health care. Does he think that?

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LIB

Rey D. Pagtakhan

Liberal

Mr. Rey D. Pagtakhan (Winnipeg North—St. Paul, Lib.)

Mr. Speaker, my question is for the member for Calgary East.

I think what we heard from the speech was a camouflage of love and like for our medicare system. The Reform Party is asking for $1.5 billion. The federal government has already increased the budget by $2.5 billion. The Reform Party is too late in asking for something even less.

I call on the consciousness of those who heard his speech filled with emotion purported to be for health and yet not one word did we hear about medicare.

My question to the member is does he believe in medicare?

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REF

Deepak Obhrai

Reform

Mr. Deepak Obhrai

Mr. Speaker, with all due respect to my colleague, I think he has everything wrong.

Let me repeat this so that he can understand it quite clearly. We are saying that the government should increase the transfer for health care and social services by the $1.5 billion that it is going to give to the transitional jobs fund. We are not talking about the $2.5 billion.

As we have heard, quite clearly, the premiers are saying that there is not enough money. Why is the government giving $1.5 billion extra to the transitional jobs fund that everyone, including members of the House, say is a disaster and a fiasco for this country?

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REF

Darrel Stinson

Reform

Mr. Darrel Stinson (Okanagan—Shuswap, Ref.)

Mr. Speaker, after listening to the member's speech I have to agree with him on the transfer payments going to Amtrak and Bombardier. However, with regard to health, everyone in the House knows that what the government did to the hepatitis C victims is a disgrace. It likes to talk about how caring and sharing it is and how it worries about people but it has only seen fit to pay off the lawyers in this case.

What does the hon. member think of a government that will pay off the lawyers and allow the victims to die?

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REF

Deepak Obhrai

Reform

Mr. Deepak Obhrai

Mr. Speaker, what my colleague has raised is exactly what is wrong in the way the whole program is handled by a government that has no vision. The point is clearly highlighted that the money has gone to the lawyers because the government would not make a decision. This is another waste of taxpayer dollars that is not directly helping Canadians but helping someone else, as the boondoggle has shown.

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LIB

Jim Peterson

Liberal

Hon. Jim Peterson (Secretary of State (International Financial Institutions), Lib.)

Mr. Speaker, when we look at this resolution and what we have heard in the House today, I find it passing strange that the resolution would call on the federal government to increase the transfers to the provinces with no strings attached.

In their speeches, members have called on increased spending for health care. Why would they not have had the forthrightness to insist that it go strictly to health care spending?

I also find it passing strange that the member for Calgary East called on us in a clarion summary to cut taxes. Instead of spending $1.5 billion here, not cutting spending and transferring it to the provinces as the resolution said, why did the hon. member not call on us to cut taxes by a further $1.5 billion? It is just part of the inconsistencies that we see.

Let me address the issue of federal transfers. First, in the last four budgets the federal government has increased the CHST transfers to the provinces for their own spending purposes.

In the previous budget, that of 1999, we increased those transfers by $11.5 billion. In February's budget, of this year, we increased it by a further $2.5 billion. That is an increase of 25% over the last two years and the CHST is now at $31 billion, the highest it has ever been in the history of the country.

In addition to the CHST, which is $31 billion, we also have to consider the other transfers that we make to the provinces which they can spend according to their own priorities. That includes equalization which, through reforms that we have undertaken, is now at $9.5 billion.

We also have to take into consideration that when we reformed the CHST in the previous budget we eliminated the so-called cap on the CAP. Provinces like Ontario will have benefited to the tune of almost a billion dollars extra over five years as we move to an equal sharing among the provinces on a per capita basis.

Let us look at how much these transfers should probably be. There are a number of issues. We know that the provinces have an insatiable appetite for any funds that we might make available. However, what is right and what is fair in the circumstances? Is it right that we should increase the transfers to provinces that are still in deficit, that are using the funds for creating tax cuts, that are borrowing money to pay for tax cuts and saddling future generations with that burden? Should this be one of our national priorities?

Should it be a national priority to increase the transfers to a province, such as Alberta, which has no sales tax today and which is introducing a flat tax that will proportionally benefit only the rich at the expense of middle income taxpayers, middle income taxpayers who will pay more under their flat tax than they would under the new federal personal income tax proposals brought down in our last budget? Is this what we should be financing?

Look at the debt burdens of the federal government and the provinces. Twenty-six cents out of every tax dollar paid federally goes to pay the interest on our debt. At the provincial level it is half that, 13 cents. Whose debts are the most onerous? Which ones should we give priority to as a nation in attempting to eliminate?

Let us look at health care transfers. The federal and provincial governments spend a total of $64 billion on health care in the country. The federal government spends $3 billion directly. In addition to that, when we look at the overall transfers that we make, the CHST, which consists of cash and tax points, is $31 billion. The traditional share of that some 20 years ago was that 54% of that went to health care, so that 54% of $31 billion is about $17 billion. If we add the $3 billion that we spend directly, the federal government's contribution to health care financing in the country is about $20 billion or about 31% of the total of $64 billion that is spent.

It is not fair for provinces such as Ontario to say that we are financing only 9% of health care. That is not right. If we add in the extra almost $10 billion that we pay in equalization, it would take the federal share to over 50%, assuming all equalization payments were spent on health care.

In conclusion, regardless of the figures and the debates, Canadians do not care whether health care is a federal, provincial, municipal or even United Nations jurisdiction. All they want is top quality health care when they need it. This is why they do not want their politicians bickering and fighting. Canadians have a right to be upset. When ambulances are diverted away from the nearest emergency ward, when people are let out of the hospital too soon and do not have adequate alternative care or home care, when there are long waiting lines and when people are being shipped to the U.S. for health care treatment, Canadians expect their political representatives at all levels to work together to make sure that Canadians continue to have top quality health care.

As the Prime Minister has said many times, we will not sacrifice the Canada Health Act. This is why we will not give additional money to the provinces until we sit down with them and work out the ways to have those funds directed for the benefit of all Canadians and to preserve the five principles of medicare. This is why we have called on the health ministers to come to Ottawa and discuss these issues with us, to work together. Canadians expect nothing less of their political representatives and they deserve that we get together to protect and preserve one of the greatest health care systems in the world.

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The Deputy Speaker

I am assuming that the minister was splitting his time because I noticed his speech was very short.

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LIB
REF

Diane Ablonczy

Reform

Mrs. Diane Ablonczy (Calgary—Nose Hill, Ref.)

Mr. Speaker, it seemed very long to me. I would have expected a little more responsibility from the assertions made by the member. He is, after all, connected with the finance department. For example, he criticized the motion for purporting to give this money to the provinces “no strings attached”. However, that is the very same condition under which this government is giving money to health care. It is giving money under the auspices of the health and social transfer which is, as far as I know, the only way it can be given. Why would the member criticize the motion for doing the same thing the government is doing?

He also said that the last budget gave $2.5 billion more to health care but he neglected to mention that is over the next five years. This year less than $1 billion will be given to health care by the government. Is it not a little duplicitous to pretend that this budget gave $2.5 billion more to health care when it is only giving it over the next five years?

Is it also not a fact that the federal government transfers in support of health care dropped by 28% since the government took office? We can juggle numbers but the raw fact is that the federal support for this important program to Canadians dropped by 28% under the neglect of the government. It cut the heart out of health care, slashed and burned support and now has the nerve to attack us for wanting to put back even the most modest amount, which is only $1.5 billion in our motion.

I invite the member to set the record straight, to be straightforward when he gives facts, and to tell Canadians exactly why the government is trying to find excuses not to give extra money to health care, particularly when it is spending $86 billion more over the next five years. It has $86 billion more to spend over the next five years than it has today, but it has just a pittance for health care.

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LIB

Jim Peterson

Liberal

Hon. Jim Peterson

Mr. Speaker, there are three errors in what the member for Calgary—Nose Hill just said.

First, the total transfers reached a high in 1993-94 of $29 billion when we consider the cash component and the tax points. Under this budget they will go to about $31 billion, an all-time high. They have not been cut. We have to take into consideration not just the cash component but the tax points which we gave to the provinces which they can draw down on and which represent cash in their hands. Forgone taxes at the federal level, increased tax revenue at the provincial level, it is cash in their hands along with the cheque we actually give them.

Second, the member was absolutely wrong when she said that the $2.5 billion in the February budget was over five years. That can be drawn down immediately by the provinces.

Third, she was wrong when she said that we are not prepared to give extra to health care. We have called on the provinces to send their health ministers to Ottawa to work out with us the ways to preserve the Canada Health Act and medicare. We will not give it no strings attached. We want to make sure that one of the best medical delivery systems in the world is maintained and is not eroded by provinces that want to privatize it, such as Alberta. We will not allow that.

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REF

Darrel Stinson

Reform

Mr. Darrel Stinson (Okanagan—Shuswap, Ref.)

Mr. Speaker, I remind the hon. member that when the provinces signed on to the medical system it was supposed to be a 50:50 proposition. Now we are down the member says 9% but I will give him the benefit of the doubt and say 13% of federal financing.

My question pertains more to what the government is doing in regard to the hepatitis C victims. The government has allowed the victims to sit with absolutely no compensation at all. Some of these people are not capable of working. They are sick. Some are close to dying and yet the government has seen fit to only pay the lawyers and not the victims.

I would like to know, since the member is in the financial end of this, how much interest is he saving by not paying the victims?

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LIB

Jim Peterson

Liberal

Hon. Jim Peterson

Mr. Speaker, obviously the member was not listening when I talked about the share of public money provided by the federal government and the provincial governments for the delivery of health care services.

Let me start again. There is about $64 billion spent by the federal and provincial governments combined on delivering health care services in Canada. The transfers we make to the provinces, the CHST, are $31 billion. Traditionally 54% of that went to health care as opposed to post-secondary education and social welfare. That would be about $17 billion out of the $31 billion which is our contribution. Add to that the $3 billion we spend directly for health care to Canada's first peoples, to our military and to the RCMP and we are at $20 billion. Twenty billion dollars out of $64 billion is 31%. It is not 13% as the member said. If we add to that the close to $10 billion in equalization that we make to the provinces, which can be spent on health care, it is well over 60%. It is not 13% as the member said.

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March 20, 2000