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CANADA: People, Places and Priorities REPORT of the STANDING COMMITTEE on FINANCE

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CANADA: People, Places and Priorities REPORT of the STANDING COMMITTEE on FINANCE CANADA: People, Places and Priorities REPORT OF THE STANDING COMMITTEE ON FINANCE Sue Barnes, M.P. Chair November 2002 STANDING COMMITTEE ON FINANCE CHAIR Sue Barnes, M.P. London West, ON VICE-CHAIRS Nick Discepola, M.P. Vaudreuil—Soulanges, QC Richard Harris, M.P. Prince George—Bulkley Valley, BC MEMBERS Scott Brison, M.P. Kings—Hants, NS Rick Casson, M.P. Lethbridge, AB Roy Cullen, M.P. Etobicoke North, ON Albina Guarnieri, M.P. Mississauga East, ON Rahim Jaffer, M.P. Edmonton—Strathcona, AB Sophia Leung, M.P. Vancouver Kingsway, BC Hon. Maria Minna, M.P. Beaches—East York, ON Shawn Murphy, M.P. Hillsborough, PEI Hon. Lorne Nystrom, M.P. Regina—Qu’Appelle, SK Pierre Paquette, M.P. Joliette, QC Charlie Penson, M.P. Peace River, AB Pauline Picard, M.P. Drummond, QC Gary Pillitteri, M.P. Niagara Falls, ON Tony Valeri, M.P. Stoney Creek, ON Bryon Wilfert, M.P. Oak Ridges, ON iii OTHER MEMBERS WHO PARTICIPATED Reg Alcock, M.P. Winnipeg South, MB Claude Bachand, M.P. Saint-Jean, QC Larry Bagnell, M.P. Yukon, YK Mauril Bélanger, M.P. Ottawa—Vanier, ON Carolyn Bennett, M.P. St. Paul’s, ON Andy Burton, M.P. Skeena, BC Odina Desrochers, M.P. Lotbinière—L’Érable, QC John Findlay, M.P. Oxford, ON Yvon Godin, M.P. Acadie—Bathurst, NB John Herron, M.P. Fundy—Royal, NB Nancy Karetak-Lindell, M.P. Nunavut, NU Rick Laliberte, M.P. Churchill River, SK Derek Lee, M.P. Scarborough—Rouge River, ON Yvan Loubier, M.P. Saint-Hyacinthe—Bagot, QC James Lunney, M.P. Nanaimo—Alberni, BC Pat Martin, M.P. Winnipeg Centre, MB Brian Masse, M.P. Windsor West, ON Alexa McDonough, M.P. Halifax, NS Joe McGuire, M.P. Egmont, PEI Grant McNally, M.P. Dewdney—Alouette, BC Massimo Pacetti, M.P. Saint-Léonard—Saint-Michel, QC Beth Phinney, M.P. Hamilton Mountain, ON Svend Robinson, M.P. Burnaby—Douglas, BC Raymond Simard, M.P. Saint Boniface, MB Bob Speller, M.P. Haldimand—Norfolk—Brant, ON Lynne Yelich, M.P. Blackstrap, SK iv CLERKS OF THE COMMITTEE Richard Dupuis Lisa Chartier-Derouin Marc Toupin (until June 19, 2002) RESEARCHERS TO THE COMMITTEE Parliamentary Research Branch June Dewetering Blayne Haggart Marc-André Pigeon v COMMITTEE MANDATE Standing Order 83.1 Each year the Standing Committee on Finance shall be authorized to consider and make reports upon proposals regarding the budgetary policy of the government. Any report or reports thereon may be made no later than the tenth sitting day before the last normal sitting day in December, as set forth in Standing Order 28(2). vii ix THE STANDING COMMITTEE ON FINANCE has the honour to present its SECOND REPORT In accordance with its mandate under Standing Orders 108(2) and 83.1, your Committee has studied proposals on the budgetary policy of the government and has agreed to report the following: xi TABLE OF CONTENTS INTRODUCTION........................................................................................................................1 CHAPTER ONE — WHO WE ARE ........................................................................................3 The Aging Population..............................................................................................................3 Population Growth Through Immigration...............................................................................5 Changing Families and the Needs of Canada’s Children...................................................6 Poverty and Income Inequality Among Canadians...............................................................9 The Reality for Aboriginal Canadians..................................................................................11 Homeless Canadians............................................................................................................13 Canadians with Disabilities..................................................................................................14 Volunteers...............................................................................................................................15 Canada in the Global Context...............................................................................................17 CHAPTER TWO — WHERE AND HOW WE LIVE ...........................................................19 The Economic Context ..........................................................................................................19 Spending and Saving by Canadians ...................................................................................22 Housing and Homelessness in Canada..............................................................................24 Increased Urbanization..........................................................................................................25 Challenges for Municipalities................................................................................................27 Protecting our Environment...................................................................................................28 CHAPTER THREE — THE PRIORITY OF PROSPERITY AND GROWTH .................31 Staying the Course ................................................................................................................31 Budget Planning, the Contingency Reserve, Economic Prudence and What to Do with the Surplus...........................................................................................33 The Bottom Line.....................................................................................................................36 CHAPTER FOUR — THE PRIORITY OF TAX CHANGES..............................................39 Personal Income Taxes.........................................................................................................41 Corporate Taxes....................................................................................................................42 Capital Taxes .........................................................................................................................45 Tax-assisted Savings Plans .................................................................................................47 Employment Insurance Issues ..............................................................................................51 Sectoral Issues.......................................................................................................................54 xiii Capital Cost Allowance Rates.......................................................................................54 Microbreweries................................................................................................................56 Air Travellers Security Charge.......................................................................................56 Other Tax Measures ..............................................................................................................58 CHAPTER FIVE — THE PRIORITY OF PRODUCTIVITY AND INNOVATION............61 Research and Development.................................................................................................61 Support for Research and Development......................................................................62 Commercialization..........................................................................................................66 Patent and Copyright Protection...................................................................................68 Smart Regulation.............................................................................................................68 Lifelong Learning and Skills Development..........................................................................69 Access to Learning Opportunities.................................................................................70 Skilled Labour Shortages and Foreign Accreditation.................................................73 Refugee Students............................................................................................................74 Support for Educational Institutions...............................................................................75 CHAPTER SIX — THE PRIORITY OF HEALTH CARE...................................................77 The Current Healthcare System ...........................................................................................77 The Concerns of Canadians.................................................................................................79 Canadians Overwhelmingly Support a Public Healthcare System............................80 Increased and Stable Funding of Health Care is Needed from the Federal Government.......................................................................................................80 The Public Nature of the Healthcare System Should be Expanded to Include Extended Pharmacare and Homecare Programs.........................................81 Accountability and Transparency Should be Ensured in the Future Healthcare System .........................................................................................................81 The Canadian Institutes of Health Research Enjoy Widespread Support ................82 Preventive Health Care Should be Emphasized .........................................................82 Caring for all Canadians.................................................................................................82 What the Committee Believes..............................................................................................84 CHAPTER SEVEN — THE PRIORITY OF SUSTAINABLE
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