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Ontario Hansard - 05-November2001

ONTARIO ECONOMY


Mr Howard Hampton (Kenora-Rainy River): I have a question to the Minister of Finance. We understand that you intend to send out one-time-only $100 cheques to 222,000 low-income families with children in the province, apparently to help them purchase Christmas presents and winter clothes. We're puzzled, though, because your plan would leave out the lowest-income families in the province, those families that are forced to rely on social assistance or the Ontario disability support program. If the strategy of your plan is to help the poorest families with children purchase winter clothes and perhaps buy their children a Christmas present, why would you exclude the very poorest families in the province?

Hon Jim Flaherty (Deputy Premier, Minister of Finance): The member speculates about what may or may not be the contents of the fall economic statement, which will be delivered tomorrow. We've certainly heard, during the course of consultations in the past couple of weeks, about the impacts on tourism and the restaurant sector in particular and also in the retail sector and on workers in those sectors as a result not only of the economic slowdown this year but also of the effects of September 11. There has been some recovery from the economic consequences of the tragedies of September 11, but that is only some recovery to date. These are issues that have been raised with me as Minister of Finance during the course of the past couple of weeks.

Mr Hampton: I asked why the Minister of Finance would exclude the very poorest families with children in the province, and he didn't answer. So let me ask him: since you've become Minister of Finance, 29,000 people in this province have lost their jobs. They have no jobs at all. Why would you exclude them? You talk about this as if it's some sort of stimulative package for the economy. But a $100 cheque to some 200,000 families has hardly any stimulative impact at all. Maybe you should try to explain this a bit better. If you're going to exclude people who have recently become unemployed and people who have to rely on the Ontario disability support program or on social assistance, this doesn't make sense, and as a stimulative package it will cause nary a dint. What's your real strategy here?

Hon Mr Flaherty: Again, the member speculates about the contents of the fall economic statement, which will be delivered tomorrow. I can tell you that we are very concerned about job losses in Ontario. When a family breadwinner loses a job, or both parents are working and someone loses a job, it has quite difficult consequences for that family, for them trying to maintain mortgage payments or pay their rent, make car payments, keep food on the table and buy clothing. These are difficult times in the western world. There is an economic slowdown. The economic effects in Ontario have been significant with respect to the tragedies of September 11. I'm sure none of us in this place would want to make light of the effects of those realities on families in Ontario. It is important that we be conscious of that and make some attempt to address those issues.

Mr Hampton: If you're really interested in addressing those issues, then I suggest you take the $2.5 billion corporate tax cut, your gift to your corporate friends, who will only get it if they're already making a profit, put it in the bank and provide a reduction in the sales tax for the 11 million people across Ontario who need some help. If you did that, you'd be helping families who have to rely on ODSP, families who have to rely on social assistance, families who have lost a job and families who have to work for the minimum wage. You'd be helping a lot of other modest- and low-income families who are also facing a difficult time, plus you'd be helping retailers. Your strategy doesn't help the poorest families, doesn't help the unemployed and doesn't stimulate the economy either. I suggest to you that all it does is provide you with a little bit of public relations cover while you funnel off another $2.5 billion to your corporate friends. If you really want to help people, reduce the sales tax.

Hon Mr Flaherty: The member opposite again raises the question of reducing the sales tax. I must say that with respect to tax cuts, I agree with Paul Martin. With respect to reducing the GST federally and the RST provincially, I also agree with the federal minister, and we've talked about this. All you get is a short-term hit, quite frankly. You accelerate spending. You pull it ahead by a month or two. It has no long-term positive gain for the economy.

On this side of the House -- and I say this with respect to the member opposite -- we're interested in long-term, sustainable economic growth and the creation of permanent jobs in Ontario. That's what grows the economy. That's what helps people. That's what helps retailers in Ontario, not short-term, knee-jerk actions.


The Speaker (Hon Gary Carr): New question, the leader of the third party.

Mr Hampton: To the Minister of Finance: I'm not surprised that you and the federal Liberals in Ottawa agree on most of these issues. You've been singing the same mantra for the last five years now, "Tax cuts create jobs." But we're seeing now, as the recession hits, that tax cuts aren't creating jobs, and you need to provide some relief to all those families out there that will give them an enticement to get back into the economy.

I want to ask you this: we saw that Quebec brought forward a strategy to provide municipalities with some money so they can begin an ambitious project of fast-forwarding construction projects and other infrastructure projects. We've asked you to do the same here. Is that something you're going to announce tomorrow? Are you prepared to bring forward some SuperBuild funding quickly, so that municipalities can begin those projects and put people back to work?


Hon Mr Flaherty: As the member opposite knows, I can't talk today about what will be in the economic statement tomorrow. But I can say to the member opposite that since 1999, more than $8 billion worth of construction projects have been caused to happen in Ontario through SuperBuild. It's a remarkable story. As you travel around Ontario today, at our colleges, at our universities, at our hospital sites you see all this construction underway now. It's the future of Ontario, this infrastructure that's happening right now. Are there going to be more announcements? You bet there are, in the next 30 days with respect to OSTAR and culture and recreation.

Mr Hampton: Minister, you may hope that by repeating that story, some people will believe it, but in fact SuperBuild is not building anything across this province. What you see in community after community is a hospital that is half built, the community trying to figure out, "Where do we get the money to cover the construction deficit?" and your government nowhere to be seen.

We've also asked you to indicate that you're not going to sell off our electricity system and create price increases and less stability there. We've also asked you if you would come forward with a readjustment fund for communities that have been hard hit by layoffs or are being hard hit by the recession. We ask you frankly to take an example from Quebec, which announced that through their own variety of SuperBuild they're going to construct 22,000 new child care spaces and 13,000 new affordable housing units -- and renovate 27,000 older ones -- and provide the lowest-paid people in the province with a $250-million sales tax credit, which wouldn't be a bad idea here, except we don't have a sales tax credit in Ontario. Would you consider any of those options as a way of helping modest- and lower-income families and Ontario industries deal with the recession rather than just giving another $2.5 billion in corporate tax cuts?


Hon Mr Flaherty: I'm sure the member opposite knows that we consider many opinions. Many options are brought forward to us with respect to budgeting and fall economic statements. There are many ideas out there, and that's why we meet and consult and listen to the various ideas.

But the concern we have is with long-term economic growth built on a firm foundation in the province of Ontario. We're fortunate now we have that firm foundation as a result of the difficult decisions that have been made over the course of the past six years. But you can't exchange this program or that program for low, competitive taxes, for prudent fiscal planning, for three balanced budgets in a row. That's what creates the firm foundation that we can build on in the future in our vision of Ontario.

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