Mr. Roy (Beauce):
Either the interventions of the hon. member were not relevant or he did not have any influence. Mr. Speaker, what is the state of our economy at the present time? We have an unacceptable level of unemployment. When a country like ours is constantly faced with such an unemployment rate, then all government action is hampered and public budgets are burdened with debts. Because of this, the government deprives itself of a few billion dollars every year when the unemployed ask only to work, be first class citizens and an asset to their families, their area, their province and their country. When we are unable to offer them this possibility, then something is wrong.
Mr. Speaker, we are faced with a record inflation rate. Some will argue of course that we are living in a global context. However, we should not forget that international problems as such do not exist. There are only national problems shifted to an international level. Decisions are not made on the international level, but on the national level. Each country should have enough fortitude to assume its responsibilities and take the necessary steps to have true leadership, the will for action and if the mechanisms fail, to improve them and give institutions the necessary instruments to make them effective and thus bring about results. Mr. Speaker, with respect to our dollar, we were supposed to save, in part at least, the Canadian economy, because we were going to maintain the oil price at 85 per cent of the Chicago rate and the dollar is worth 85 cents. Therefore, if my calculations are right this is equivalent to the value of the American dollar, so nothing has changed.
As far as energy is concerned, what is the government policy? What was the policy of the former government? Are our problems just recent or do they go back to months or years? What about projections? What has the new government done since May 22, when the voters defeated the former government and decided to elect a new government full of good will after having made many promises to give rise to great expectations among the people?
And where do we stand today, as far as energy is concerned? The government starts by reaching into the pockets of the taxpayers before announcing particular programs which remain to be finalized. And yet, our hon. colleagues who are now managing the affairs of our country, after such a long time spent in the opposition, should have had sufficient time to
examine the records. In all that time you would think that they saw enough budgets to prepare their political platform. 1 suggest that they have been in power long enough and have had enough cabinet and committee meetings to be able to announce to the Canadian public at the same time as the budget, if not a few days before, their decision about what is to be expected. All the while the taxpayers are paying, the unemployment rate is high, inflation is rampant, the Canadian dollar is ailing, and the very important subject of energy policy is causing considerable concern to the Canadian public. They are still waiting.
Mr. Speaker, to solve unemployment they are looking for a magic formula, a single formula for Canada as a whole. However the rate is very high in the maritimes, somewhat less but still too high in Quebec, and lower still in other areas. But in fact, in this large country of ours, we have provincial governments that are capable of taking their responsibilities, capable of acting. And rather than infringing on their jurisdiction, we should give them the means to assume those responsibilities. In this way, instead of fighting those governments of whatever political creed, we would co-operate with them, whether they be Social Credit, Liberal-although there are none left-Conservative or NDP governments.
As far as inflation is concerned, there would be much to say. We questioned the Minister of Finance (Mr. Crosbie) in the House, asking why he agreed with the governor of the Bank of Canada who had announced a third increase in the interest rates. At the request of the opposition, the Committee on Finance, Trade and Economic Affairs held sessions, the governor of the Bank of Canada appeared, the Minister of Finance also appeared, and here is what the Minister of Finance said, as appears on page three of his statement:
A third reason for present interest rate levels is the large and growing deficit in the current account of our balance of payments. That cannot be reduced quickly either, and as long as it continues it must be covered by an adequate flow of capital into Canada.
The minister went on to say:
High interest rates counter inflation as they discourage excessive spending. As demand drops, businesses come under competitive pressure, and this helps to keep other costs and prices down.
To the extent that there is a cause and effect relationship directly between interest rates and inflation, it is more accurate to say that inflation causes .. .
-he did not say is the main cause for-
... it is more accurate to say that inflation causes higher interest rates than it is today the reverse.
What is the Minister of Finance announcing? Mr. Speaker, in the energy area the government will have to know that there are inequalities between regions, that the problems are different at that level and that there must be a stop to the siphoning off of huge amounts of money from certain regions for transfers to other regions. There will have to be some compensations, some new formulas, some answers in order to have an economic balance based on values, capabilities and resources which are available in the various regions and provinces which
December 13, 1979
make up Canada. Mr. Speaker, in the world we are entering a new era, characterized by a shortage of resources, and Canada is one of the biggest reservoirs of resources in the world. What are we doing to try to make Canadian resources benefit Canadians?
Do our huge resources contribute to create more jobs for Canadians? Do our resources contribute to lessen the pressures on the government budget to reduce taxes so that taxpayers take advantage of them? Is there a budgetary policy which would enable us to incur smaller deficits than we now have? To each of those three questions, Mr. Speaker, the answer is negative.
There is another factor in the industrial field throughout the world and it is the importance of semiconductors. We know quite well that it has now become the second largest industry in the United States. What is the position of Canada in that area? Those are some of the questions which remain unanswered. We have trading partners who are uncertain. And even after the budget speech, quite apart from the unbearable tax on fuel, there is no certainty. Even if there were a few adjustments, there is no more certainty than before. Why? Precisely because there is no comprehensive policy, there is no comprehensive plan. As for the fall in our growth, Mr. Speaker, it is a catastrophe.
Mr. Speaker, what we needed was a budget which would have helped us fight against unemployment and inflation, improve our deficit in the balance of payments and provide a true energy program. We expected incentives for large scale projects, which would have increased our chances of achieving our energy self-sufficiency. For instance, what did the budget say about the Bay of Fundy? Nothing at all. Eerily silent indeed it was about the north-south pipeline and the east-west pipeline. We were also expecting incentives for the manufacturing industry which would have improved the balance of payments so as to shore up that part of the commercial balance which represents the manufacturing sector.
Mr. Speaker, I have here quite eloquent charts for 1978 and 1979, but I would like to compare the months of September and October, 1979. While the value of our exports of finished products other than foodstuffs was roughly $15 billion in September, 1979, the value of our imports in the same field for the same month is $28,222 billion, which leaves us with a deficit of $13.1 billion. Did that improve in October? In October our exports, always in non-edible finished products, were of $17,166 billion and our imports in the same category were of $31,669 billion for a deficit of $14.5 billion for one month; for September and October the trading deficit for non-edible finished products increased by $1.5 billion. The Minister of Finance was strangely silent on this question which, by itself, would warrant an emergency debate in the House, emergency measures and an emergency program. Our problems are balance of payments problems and our huge budgetary deficits are caused by high unemployment rate. It is
The Budget-Mr. F. Roy
because of these deficits that we must bear such high interest rates which are close to being highway robbery. What was announced? We are given a provincial budget. Having debated nine budgets at the Quebec National Assembly, I knew that by provincial jurisdiction, by what authority is given to the provinces, they are limited to fiscal power, and freedom of action is determined by fiscal power. The speech given by the Minister of Finance was an exact replica of the budget speeches given by provincial finance ministers. Because he restricted himself exclusively to the fiscal power. When I made up my mind to run in a federal election, I assumed that in the Parliament of Canada we would be able to look into problems as a whole, that the main economic levers under the constitution were in Ottawa and that in Ottawa also were extraordinary tools which, if used wisely, could set the Canadian economy in motion again, alter the course of our destiny, and that with the new powers now available, the federal government, instead of using its spending power to invade areas under provincial jurisdiction and thus restrict even more the fiscal powers of the provinces, would effectively look toward the future and make sure that the provincial governments are its true partners.
Instead of that, the new government has chosen to pursue the policy initiated by the former government and invaded a fiscal area which until then, with a possible exception in 1920, had been left to the provinces. And these same people are now blaming the government. They had the nerve-I certainly could use more violent words, Mr. Speaker-to move this motion. That motion should read:
And that this House unreservedly condemns the government for its outright betrayal of its election promises-
Mr. Speaker, this House condemns the government for its budget which will place an unfair and unnecessary burden of higher gasoline prices, higher fuel oil prices, and higher taxes on middle and lower income Canadians. Yet, Mr. Speaker, a great deal of care has been taken, great subtleness displayed and even great caution exercized in this matter not to blame the government on a specific point, namely the 25-cent tax, because the former government, the official opposition now trying to defeat the present government at any cost in the hope of replacing it-does not want to commit itself to withdrawing this tax if it ever gets back into power. The opposite side will naturally be accused of having imposed it. Yet they do not want to commit themselves, they act very carefully, very cautiously, very skilfully because they actually do intend to keep it. Let us be frank about it. I did not hear a single member of the Liberal party state in this House he was committing himself to withdrawing it.
Mr. Speaker, it is quite interesting to go back in the past and study the content of the various statements made by the ministers. 1 am referring to Hansard for July 2, 1975, page 7409. Mr. Turner, who was then finance minister, was speaking about the 10-cent energy tax imposed by the former government, the present official opposition which today pre-
December 13, 1979
The Budget-Mr. F. Roy
tends to be shocked. However, its members do not dare look at themselves in a mirror, they would be ashamed! Here is what the former finance minister, not the "blue" one but the "red" one, had to say:
It will also contribute significantly to energy conservation, an objective that I believe all Canadians support... To effect this objective, the special excise tax on gasoline-which is imposed at the manufacturer or importer level-will be refunded to all exempt users.
Some measures were announced in this regard. And, Mr. Speaker, if 1 go on reading, I see the then finance minister-I insist that he was a Liberal finance minister-said:
As I mentioned earlier, Mr. Speaker, the Progressive Conservative leader .. .
Because he was indeed attacking the official opposition-
... insisted that oil subsidies should not be funded through an excise tax on gasoline because it would be a source of grudges between eastern and western provinces.
But what is even more surprising-and here I think our Progressive Conservative colleagues will not applaud me, but perhaps the Liberals will-Mr. Stanfield, the then leader of the opposition, said, and 1 quote:
He recognizes that. So what does he do? He does not try to counter that. He sets out immediately to increase vastly the inflationary aspect of the increase in the cost of energy, recognizing that the increase in the price of oil and gas at the wellhead would be inflationary and would create some inflationary pressure ... The minister said, however, that he could not give the House an estimate of how much gasoline would be conserved as a result.
The present minister did not do it either.
The ten cents tax-
It was ten cents at the time and they were mad, of course, as we would have been.
-will not aid the supply situation either. It will not encourage companies to go looking for oil or gas. It has nothing to do with easing the supply situation which the minister has always talked about in the past. When he was not blaming inflation or the weather or something that happened in the United States, he was emphasizing the importance of increasing supply in Canada. This ten cents per gallon tax on gasoline is not going to do anything to increase the supply of gasoline in Canada, and I am sure that the minister would not even make the argument that it might.
And further on, I am still quoting from the leader of the Progressive Conservative party, the then leader of the official opposition:
This ten.cent tax, being on a user basis, is very concentrated,-
It is strange how short our memory is.
-very visible, very stark in its effects on the consumer and taxpayer;-
That is a ten-cent tax, but they increase it to 25 cents.
-clearly its tendency will be to encourage the person on a wage or salary to push for a higher increase than might otherwise have been the case.
If a ten-cent tax prompts the taxpayers to ask for salary increases, how can a 25-cent tax not have the same effect? 1 should like to have an answer from the government side; since they have power, they must also have some knowledge.
[Mr. Roy (Beauce).J
It cannot have any other possible effect. This measure, being in no way conducive to restraint, will have a very clear and stark tendency in the opposite direction.
So the tax at the wholesale level is not just inflationary but it is also an increase in the cost of marketing the product.
A gasoline tax makes sense-
Listen to this one. This was said by the then leader of the opposition, and I am in complete agreement with him.
A gasoline tax makes sense as a road building tax in the hands of provinces. It makes sense if it is considered as a road user tax in the hands of provinces.
The Progressive Conservatives said this when they were in the opposition. They denounced a ten-cent tax, and now, five years later, when they are in power, they increase this tax to 25 cents. What logic! This is what we call consistency in politics. They follow the same old line and then wonder why taxpayers have all sorts of problems. There are many other things that I could quote, but since we shall not have the opportunity to bring up the subject again during the debate, I want to say that the motion introduced by the official opposition is inconsistent and insincere. It is hypocritical and aims only at deluding the population into believing that, after six months, they have seen enough to know exactly what to do.
Mr. Speaker, the truth must be told about the New Democratic Party. The NDP have also introduced a motion, not an amendment pure and simple, but a subamendment because our rules allow them to do so. For our part, we are not entitled to move an amendment or subamendment. Had we been able to do so and if the rules had allowed it, we would have proposed a subamendment and the three other parties would have joined forces against us because they refuse to strike at the root of evil and to tackle the basic problem.
And what does the New Democratic Party's motion say?
And this House unreservedly condemns the Government for its outright betrayal of its election promises to lower interest rates, to cut taxes, and to stimulate the growth of the Canadian economy, without a mandate from the Canadian people for such a reversal.
This is a non-confidence motion, no more and no less.
What is the New Democratic Party's proposal? What would they do, if they were the government, tomorrow morning?
Mr. Speaker, before I came to this House I always believed that the New Democratic Party was serious, but during the time I have been here, they have been attacking interest rates, inflation, unemployment, everything. But I still have to hear a positive proposal from them. Does that party believe only in carping instead of offering solutions? Frankly, this is rather disappointing. Fortunately our debates are televised, the people will be able to find out. I have not heard one single proposal from the New Democrats that would tell us what they would do if they were the government. Their approach is negative. They are physicians that know a disease when they see one, but are unable to cure it.
December 13, 1979
The Acting Speaker (Mr. Scott, Victoria-Haliburton):
Order, please. 1 regret to inform the hon. member that his allotted time has expired. In order for him to continue, he requires the unanimous consent of the House. Is there unanimous consent?
Topic: GOVERNMENT ORDERS
Subtopic: THE BUDGET