Speech

From the Prime Minister's Web Site (http://www.pm.gc.ca/)

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Prime Minister adresses CALU

May 8, 2006
Ottawa, Ontario

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Thank you very much for your warm welcome, ladies and gentlemen.

And thank you, Gord, for your kind introduction.

As many of you know, Gord is a founding member of CALU.

A man who, like so many of you, believes in entrepreneurship and the values it embraces – like hard work, innovation and achievement.

These are values we have both long wanted to see guide the Government of Canada,

And I thank you, Gord, for all your support over the years.

For example, when I addressed your organization last year, I spoke of the damage caused by years of scandals during the previous administration.

Of the need to end waste, gross mismanagement, and corruption.

And of the need to clean up government.

Well, that’s just what we started doing last month when we introduced the most comprehensive piece of reform and anti-corruption legislation in the history of the Canadian Parliament,

The federal Accountability Act.

This bill will overhaul electoral financing legislation and end the influence of big money in federal political parties,

By limiting donations to individuals and to a maximum of $1,000 per year.

It will end the revolving door between ministers’ offices, the bureaucracy and lobbying firms,

By banning ministers, ministerial staff and senior public servants from lobbying the federal government for five years after they leave office.

It will clean up the federal government’s contracting, polling, procurement, advertising and appointments processes to ensure they are not used simply to reward political friends.

To make sure the system stays clean, we will also give greater powers to independent watchdogs such as the Auditor General

And it will protect whistleblowers who come forward with proof of wrongdoing.

Finally, we’re going to ensure truth in budgeting by setting up an independent parliamentary budget office.

The idea is to replace the culture of entitlement that thrived under the previous government.

And give Canadians good, clean government.

Government that is accountable.

Government that treats their tax dollars with respect.

That’s what Canadians voted for on January 23.

And that is what we are going to give them.

I also promised last year that we would restore our special trade and security relationship with our biggest customer and closest neighbour – the United States.

And we have begun to act by, for example, renegotiating and renewing the NORAD agreement.

But probably most importantly, we have reached an agreement to end the longstanding, crippling softwood lumber dispute with the United States.

This deal is good for Canada and for Canadian producers. Under it we get

Back over 80% of the money - over $4 billion US - that had been tied up in endless litigation;

Guaranteed and stable access to the US market, including no quotas and no tariffs under current market conditions; and

Protection from cheap exports of wood to the US from third countries.

This shows what can be achieved when we put goodwill and hard work ahead of crass politics and cheap rhetoric.

And most important, ladies and gentlemen, a conservative government will have different economic priorities.

We value the private sector and the entrepreneurial spirit.

We believe opportunity is created when hard work and innovation are rewarded.

We understand business thrives when government embraces an environment that rewards achievement.

On January 23 the people of Canada voted for that kind of change, and we are going to deliver that kind of change.

And last week, Finance Minister Jim Flaherty delivered that kind of change in his first budget. A budget with a surplus, a responsible budget, a conservative budget.

A budget that cuts the taxes paid by Canadian individuals, households and businesses of all sizes.

It cuts two dollars in taxes for every dollar in new spending.

In fact, over the next two years we’re going to deliver tax cuts of almost $20 billion for individuals – more than the last four federal budgets combined.

Sales taxes. Down.

Income taxes. Down

Business taxes. Down

Immigration taxes. Down.

Capital and capital gains taxes. Down.

You name it. There are no fewer than 29 different taxes reduced in this budget.

As a result of our tax reductions, over 650,000 low-income Canadians will be removed from the federal tax rolls altogether.

As you know, we’re going to begin cutting taxes for all Canadians by reducing the GST from seven to six percent as of July 1.

We are also cutting personal income taxes, not just by raising the personal exemption and keeping low-income rates down,

But also by giving an employment tax credit that will especially benefit middle-income workers.

This tax credit, worth up to $500 and set to double to a maximum of $1,000 in January 2007, will offer working Canadians relief.

These cuts will mean real savings for ordinary Canadians.

Families earning between $15,000 and $30,000 a year will save almost $300.

While those earning between $45,000 and $60,000 will save almost $650.

Money that will help them get a little further ahead.

So they can buy the necessities of life.

Or save for their children’s education.

Whatever they want.

After all, it’s their money.

They worked hard to earn it.

So they should be able to keep more of it.
The same is true for businesses.

We’re also going to unleash the entrepreneurial potential of our small business sector.

We will increase the amount of income eligible for the 12 percent tax rate from $300,000 to $400,000.

And this rate will drop to 11.5% in 2008 and 11% in 2009.

In addition, we are going to cut the taxes all Canadian businesses pay by:

Reducing the general corporate income tax rate to 19 percent from 21 percent by 2010, two years ahead of schedule;

Eliminating the corporate surtax; and

Getting rid of the federal capital tax entirely.

Many of you will notice that the budget also contained some significant exemptions for capital gains taxation.

For example, there will no longer be capital gains tax for up to $500,000 transfers of fishing businesses within the family, as exists already for farmers and woodlot operators.

There will also be no capital gains tax on securities donated to charity, which we believe will provide a major infusion of funds to social and cultural agencies.

And don’t think I have entirely forgotten our campaign pledge to allow greater deferrals of capital gains tax generally.

That is an item we are doing more work on for next year.

Our budget also contains new budgetary initiatives,

But they are targeted within areas of federal jurisdiction, and we are determined to refashion the expenditure management system.

On the spending side, our budget is focussed.

Now let me just say, ladies and gentlemen, that I am concerned about the rates of spending increase.

They are down in this budget from the double-digit increases we’ve seen in recent years, but we are still increasing spending at least as fast as economic growth.

Minister Flaherty and the President of the Treasury Board, John Baird, are committed to an overhaul of the expenditure management system,

Which is completely broken,

And they have promised me results by the early fall.

But even now, our spending is more controlled and more focussed.

We have a limited set of major priorities – five, not fifteen, not fifty.

There will be no more wasting money on ever-changing and ever-expanding priorities.

We know what we believe.

We know where we stand.

And the vast majority of our new spending is going to clear areas of federal jurisdiction.

Enforcing public security and the surveillance of our borders.

Toughening criminal justice and restaffing the RCMP.

And, of course, beginning the long-term job of rebuilding our armed forces.

As step number one in resolving the fiscal imbalance, we have increased the transfers to the provinces in their areas of jurisdiction.

Already, most provinces are moving into a surplus position and, with a less centralizing federal government,

We are seeing a major improvement in the national unity situation.

When we spend, we will spend in ways that reflect the real priorities of ordinary Canadians.

Last year I also promised not to impose on Canadians an inflexible, knee-jerk approach to daycare.

The previous government was prepared to transfer billions of dollars to bureaucrats, advocates and other politicians in the name of daycare.

In our budget, most of that money now goes to parents.

All parents with pre-school children will receive the new universal child care benefit of $1,200.

Because we believe parents, not governments, should make child care choices.

We’re also investing in our economy and our future, particularly our young people.

We’re providing more money for public infrastructure investments, which have been in a disturbing long-term decline in this country.

And our investments in post-secondary education are significant.

Indeed, we are offering the provinces a billion dollars in additional funding for post-secondary infrastructure.

And we’re going to help young people and their families to pay for their post-secondary education:

By exempting from federal tax all scholarship income,

By offering a new tax credit for text books, and

By extending students’ eligibility for the Canada Student Loans Program through a reduction in expected parental contributions.

Nor have we forgotten those headed for the skilled trades.

That’s why we are introducing a tax deduction of up to $500 over and above the new employment tax credit.

And why we are encouraging employers to hire apprentices through a new tax credit of up to $2,000.

So there you have it.

Ladies and gentlemen, on January 23 Canadians voted for change.

And they gave our party a mandate to lead that change.

Only a 100 days have passed, but we are determined to lead and determined to deliver.

We promised to clean up government.
We’ve introduced the federal Accountability Act.

We promised to cut taxes and put Canada on the right economic track.

Those are the priorities of our budget.

We promised to build a more mature relationship with the United States, and to give real support to our men and women in uniform. That is what we are doing.

So we’re off to a good start.

We are doing other things that, if I am still around next year, I’ll have a little more time to tell you about

Like acting against gun, gang and drug crime and making our streets safe once again

And in a spirit of cooperation with all the provinces in order to create a united, independent and free Canada

And with a proud, confident and autonomous Quebec possessed of a strong sense of solidarity.

In the meantime, let me just remind you that we are trying to do these things in a minority Parliament.

And there are many in this Parliament who, for their own political reasons, don’t want to see change, even if the changes are positive

Or maybe especially if they are positive.

So we’re going to need your help – the help of everyone in this room, in this organization, or anyone else you know who supports what we’re doing.

Help us by emailing, writing letters, or telephoning members of Parliament of all political parties.

To tell them we’ve had enough scandal and inaction and dithering.

Tell them to get with the plan.

Our plan for passing the budget and reducing taxes.

Our plan for passing the softwood deal and getting the US relationship back on track.

Our plan for passing the Accountability Act and cleaning up government.

Our plan for moving forward and building a stronger Canada.

The plan Canadians voted for on January 23rd.

The plan we are getting on with so that, as our campaign slogan said, we can stand up for Canada.

Thank you.

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The Prime Minister’s Office - Communications
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