Province Législature Session Type de discours Date du discours Locuteur Fonction du locuteur Parti politique Saskatchewan 24e 1e Discours sur le budget 29 mars 2000 Eric Cline Ministre des Finances Saskatchewan New Democratic Party Mr. Speaker, it is my privilege to stand in this House today to present Saskatchewan’s first Budget of the 21st century. This shift to a new century provides a special energy for change. For not looking back to what was, but ahead to what can be. I say to the people of Saskatchewan that it is time to move forward. To address pressing challenges in innovative ways. To shape our future with a solid plan for the growth of our economy and, more importantly, the growth of our society. By taking bold, thoughtful, forward-looking action today, we will achieve our vision for the future. A vision of Saskatchewan: • where people choose to live and work, based on strong bonds of family and community; • where responsive, effective public services support and enhance each person’s ability to live a meaningful, satisfying life; • where our young people find real opportunities to develop their talents to contribute to and benefit from a dynamic, growing economy. We enter this new century on the threshold of change and opportunity. The question before us is this: Do we, the people of Saskatchewan, have the vision and the courage to step over the threshold, through the door and into the future? I say we do. This Budget says, let us begin shaping that future today. In my address today, I will describe a broad, four-point plan for growth and opportunity in Saskatchewan — a plan we intend to follow not just in the coming months, but over the coming years. The key areas of this plan for growth and opportunity are: • fiscal responsibility and good government; • a sustainable, effective health system; • economic growth and jobs; and, • tax reform. The Fundamentals: Fiscal Responsibility and Good Government First things first — fiscal responsibility and good government. Mr. Speaker, sound financial management is a hallmark of this Government. Our responsible, balanced approach has supported the longest period of sustained economic growth since the 1970s. It has allowed us to invest in important public services and reduce taxes each and every year since we balanced the budget in 1994-95. And, we have reduced Saskatchewan’s debt from almost 70 per cent of gross domestic product to less than 38 per cent today, falling to 31 per cent by 2004. Sound management has encouraged confidence in our economy and in our ability to manage through good times and bad. But, that success remains vulnerable to forces beyond our control. Over the past few years, we have seen clear evidence of the volatility of our economy. Our revenues can rise and fall dramatically from year to year depending on global forces, such as the price of oil. We may have no control over these fluctuations. But, good planning demands that we prepare for them — despite the desires of those who would spend all our revenues, and more, as they are generated. Simply put, our plan for the future starts with the fundamentals. Today, I am announcing the creation of a new Fiscal Stabilization Fund to strengthen our capacity to respond to the needs of Saskatchewan residents. Our target will be five per cent of annual revenue set aside to deal with unexpected circumstances and to ensure that, when they occur, we do not need to raise taxes, cut services or return to deficits and growing debt. Our target level for the fund will be clear, and the use of the fund completely transparent. Mr. Speaker, good government is something that every citizen in a democratic nation expects and deserves. Fiscal integrity must remain our watchword. Our Government is equally committed to accountability to the people it serves. Over the past year, we have been developing a new accountability framework that will outline the goals, objectives and achievement targets of the Provincial Government, its departments and agencies. This framework will be fully implemented over the next few years, giving Saskatchewan people solid reference points by which to judge the performance of their Government. The Future of Medicare: A Sustainable, Effective, Public Health System Let me turn to an issue that is of significant concern to people throughout our province and, indeed, our nation. That is the future of Medicare, a health system that is the envy of the world. The recent federal budget was a huge disappointment to Saskatchewan, and to all provinces, in this regard. What was once a strong commitment by Ottawa to Medicare has become little more than lip service. Let us not fool ourselves. With the federal government paying only 13 cents of every health dollar, the future of Saskatchewan’s health system is in our hands alone. Today, there are major challenges to achieving a sustainable health system. New technologies; new drugs; new treatments; an aging population; increased utilization; better home care and more preventative services — these have had the two-fold impact of improving care and increasing costs. Over the last two years, we have increased health spending by 17 per cent. We have to protect our health care system while changing this trajectory of skyrocketing costs. And to do that, changes must be made. We recognize that change is never easy. And, we recognize that additional funding will be needed to ease the transition to the health system of tomorrow. To back our commitment to renewing the health system, we will put in place the necessary measures to get it done. This year, we will provide a $63 million increase in base funding for our health system. In addition, I am pleased to announce the establishment of a $150 million Health Transition Fund to provide one-time support for change. We are putting aside the resources needed to make these changes while ensuring people continue to have access to quality services. We will be talking with health districts, health providers and the public to develop the vision and plan for a sustainable and effective health system for the 21st century. Let me be clear: there is a future for Medicare. It is here, in Saskatchewan, the birthplace of Medicare. Economic Growth: New Opportunities Now, let me turn to the third part of our plan, which is also our most important opportunity: creating an economy that realizes the vast potential of our great province. Building an economy of growth and opportunity requires economic development and social development. Our plan includes both. We seek to build an economy and a society that focuses on the tremendous energy of our people; provides opportunities for them to innovate and contribute; and rewards them for working hard, taking risks and giving back to society. Our province’s greatest successes have come from our strong belief in this fundamental principle of sharing the benefits of economic opportunity. Our Building Independence strategy has helped reduce dependence on welfare and remove barriers to entering the workforce. In particular, the Saskatchewan Employment Supplement is tearing down the so-called “welfare wall.” In the past five years, the number of individuals and families receiving social assistance in Saskatchewan has dropped by over 6,000. The number of children on welfare has dropped by 11,000. And, Campaign 2000 reports that Saskatchewan is the only province to reduce the incidence of child poverty. The nationally acclaimed Saskatchewan Action Plan for Children has also played a key role in ensuring Saskatchewan children and families have the support they need to live with dignity and independence. It has provided support to children and families most in need through services such as nutrition programs, school allowances, infant care for teen mothers, early childhood intervention and social housing. Building Independence and the Action Plan for Children are models of success, attracting national, and even international, attention. They clearly demonstrate this Government’s commitment, and the commitment of all Saskatchewan people, to extending opportunity to all members of our society. Education and Training A plan for growth and opportunity must focus on our young people — on ensuring they have the skills they need to take our economy into the future. It must include a plan for education and training, because the new economy is a knowledge-based economy. That is why this Budget includes: • increased funding for our K-12 school system to hold the quality of education to its highest standard, focusing on special education, community schools in the North, pre-kindergarten programs and new distance learning initiatives; • capital funding to complete up to 115 school projects this year, providing modern, safe and healthy schools for all Saskatchewan children; • increased operating funds for our universities, regional colleges and SIAST, to maintain the quality of our post-secondary systems; • capital funding for important post-secondary projects, including the Thorvaldson and Kinesiology buildings at the University of Saskatchewan; • increased capacity in the Registered Nurse and Licensed Practical Nurse programs; • new funding for Technology Enhanced Learning; and, • more support for people with disabilities to access education and training. This Government is committed to job and skills training that makes sense for Saskatchewan people. This Budget provides training opportunities for thousands of Saskatchewan residents through our apprenticeship, adult basic education and other employment programs. Included in our Budget is increased funding for the Skills Training Benefit, and a new Forestry Training Strategy. For post-secondary students, our student assistance programs are among the best in Canada. But, there must also be opportunities for our students beyond graduation. The energy, creativity and drive of young people are critical to Saskatchewan’s future. We want our graduating students to stay in Saskatchewan and contribute to shaping our future. We also want graduating students from across Canada to come to Saskatchewan. I am very pleased to announce that, beginning in 2000, all post-secondary graduates who choose Saskatchewan will receive a one-time tax credit that can be used over a four-year period to help them establish careers in our province. Research and Development Our Province will also promote more growth and opportunity in a knowledge economy through a strong commitment to research and development. I am pleased to announce that this Budget will keep building our province’s research infrastructure with continued commitment to: • the establishment of an international test centre to reduce carbon dioxide emissions and increase oil recovery; • two new facilities at Regina Research Park, dedicated to petroleum technology research and information technology; • expansion of Saskatoon’s renowned Innovation Place with the addition of a new agricultural research centre; and, • the Canadian Light Source Synchrotron, this nation’s largest scientific project, scheduled for completion in 2003. The Synchrotron will attract researchers from around the world and is a strong symbol of our growing reputation for excellence in research. To further strengthen research and development opportunities, I am pleased to announce the establishment of the new Innovation and Science Fund. The Innovation and Science Fund will help increase the capacity of our research institutions, and encourage new partnerships. Furthermore, it will enhance our ability to attract new federal investment through the Canada Foundation for Innovation. This Fund, worth $10 million a year, will mean a total research and development pool of up to $100 million over four years — major new investments that will build on our tradition of innovation. Agriculture Another crucial element of growth and opportunity is the development of our rural economy. The recent downturn in agricultural markets puts a sharp focus on the changing face of agriculture and rural Saskatchewan. American writer and educator John Gardner noted that: “We are all faced with a series of great opportunities, brilliantly disguised as insoluble problems.” This Government has the courage and vision to look past that disguise to find new opportunities. We will look beyond short-term solutions that do nothing to prepare us for the future. In February, following months of intensive negotiation, our Government secured an agreement with Ottawa that will put needed cash in the pockets of Saskatchewan producers in time for spring seeding. In Saskatchewan, we are also reducing the producer’s share of crop insurance premiums to make it more affordable. And, we are doing more. I am very pleased to announce that, effective immediately, and retroactive to January 1, 2000, the cap on the Farm Fuel Rebate Program will be eliminated. Farmers will be fully reimbursed for provincial tax on all fuel used in farming operations — reducing input costs today, and in the future. There will be no provincial tax on farm fuel. And, to further assist this important industry, I am pleased to announce that this Government will provide Saskatchewan farmers with a property tax rebate of $25 million in the year 2000 — and another $25 million in 2001. This province has a strong future because Saskatchewan people are able to see beyond “what is” to “what can be.” The success stories in Saskatchewan agriculture are many. Despite the current difficulties, Saskatchewan farm families forge ahead, with new ideas and new directions for the future. New crops, such as pulse and organic crops, and new initiatives in livestock and agricultural processing are bolstering growth and opportunity in agriculture and agri-value. We will continue to create new opportunities through investment in areas such as research and development and New Generation Co-operatives. Northern Development and First Nations Partnerships Our abundant natural resources, sensibly and sustainably developed, will also continue to create new opportunities for growth in Saskatchewan. This Budget looks to the future of our northern communities with: • a special forest fire contingency to manage the risk of extreme forest fire seasons and their threat to communities in the North; and, • a new Forestry Industry Development Plan, including new industrial plants, new partnerships and new training initiatives. These major forestry initiatives are an important step in developing our northern economy. They are also key to building real partnerships with Saskatchewan’s First Nations people. In forestry, in the North and elsewhere, success demands that First Nations people participate in, contribute to and share in the wealth of our province. The goal is simple. The goal is achievable: full First Nations’ participation in our economy. Nothing less. In pursuit of this important goal, this Budget will also continue to support opportunities for First Nations people through: • the Multi-Party Training Plan; • the Saskatchewan Indian Federated College, Gabriel Dumont Institute, the Northern Teacher Education Program and the Saskatchewan Urban Native Teacher Education Program; • Indian and Metis Education Development services; • the Aboriginal Employment Development Program; and, • the new Forestry Training Strategy. Highways and Infrastructure Another element of growth and opportunity is the development of our physical assets — our roads, highways, schools, colleges, universities, social housing, municipal infrastructure, our environment, parks and heritage properties. I am pleased to announce that this Budget makes the largest investment in our highways and transportation infrastructure in the history of Saskatchewan — $250 million to prepare our transportation system to support new opportunities and the economy of the future. This is in addition to over $26 million provided for local roads through our provincial-municipal funding arrangements. And, I am proud to make a further announcement on this topic. This Budget establishes a $120 million Centenary Capital Fund, $30 million a year to help address specific infrastructure needs over the next four years. This new fund will supplement the $10 million Provincial-Municipal Infrastructure Program, established last year. Through the Centenary Capital Fund, we will build a bridge to the new economy with: • $5 million a year more for municipal infrastructure; • $5 million a year more for transportation, highways, rural roads and environmental clean-up; • $5 million a year more for capital investment in universities, SIAST and regional colleges; • $5 million a year more for school capital projects; • $5 million a year more for social housing; and, • $5 million a year more for upgrading our parks and heritage properties. Here, too, we will look to the North and what is needed to develop a stronger northern economy. We will address northern water and sewer needs through a multi-year capital program. And, the criteria used to allocate money from other categories within the Centenary Capital Fund will ensure that a minimum of $5 million a year will go to the North. We will also work with federal and municipal governments to upgrade and modernize Saskatchewan communities. Overall, the funding we are providing for transportation and infrastructure is a substantial investment in Saskatchewan’s future. A New Tax System: Simple, Fair, Competitive This brings me to the final topic of my address today — the fourth and final part of our plan for growth and opportunity — tax reform. In my last Budget Address, I promised that this Government would review our personal income tax system. I want to publicly thank the members of the Personal Income Tax Review Committee — Jack Vicq, Shelley Brown and Charlie Baldock — for their hard work in this regard. As we know, Saskatchewan’s economy is changing and there are real opportunities for new prosperity and growth. But, if we are to capture those opportunities and keep our economy growing, we must have a competitive tax structure. That is why our plan for growth and opportunity includes a strategy to reduce taxes, make our economy competitive with our neighbours and put money back into the pockets of every Saskatchewan resident. Over the last several months, we have been advised by experts. We have heard from the people. And we have listened. Now is the time to take what we have heard and implement tax reform our way — the Saskatchewan way. The Saskatchewan way means a progressive, fair tax system that gives Saskatchewan working people a real tax cut. But, a tax reduction plan can’t be about cynical politics — about buying the short-term goodwill of people with their own tax dollars. It must be about good public policy. It must be about good economics. Above all else, it must be about the future. Now, there are those who say, and I quote, “You can have your cake and eat it too.” They say you can slash hundreds of millions of dollars from tax revenues with no effect on the level of services you provide, without concern about deficits and debt, and in the naive belief that spending on services like health and education can be frozen. That is not good public policy. That is not good economics. That is not even good arithmetic. It is just cynical politics. Others believe change is not needed. That, somehow, the creation of wealth is not a prerequisite to the fair distribution of wealth. That economic development is, in some mysterious way, the enemy of social development. That is not good public policy either. It is not good economics. It is simply rhetoric. To resist change, and the opportunities change can bring, is to say the way into the future is by the pathways of the past. Mr. Speaker, the people of this province are demanding something quite different. If we are to capture the new economic opportunities being offered by a rapidly changing world economy, Saskatchewan will need vision, leadership and courage. Saskatchewan people know that something must be done. They know change must come. I have been clear in stating that tax reform from this Government will be guided by three principles: • tax reduction must be sustainable and funded from new revenue; • it must be matched by investment in priority public services — that is, a balanced approach that recognizes both competitive tax rates and quality public services are important to society; and, • most important of all, it must be fair and progressive, putting lower-income people in a better financial position. Let me outline the key elements of our plan for reforming Saskatchewan’s tax system. First, we will establish a provincial income tax system that is simple, fair and competitive. Effective January 1, 2001, Saskatchewan will move to a three-rate income tax structure, completely eliminating: • the flat tax; • the debt reduction surtax; and, • the high income surtax. This move alone will make our tax system simpler and easier to understand. It will provide us with the ability to use our income tax system in a way that fully benefits the people of Saskatchewan. Second, the new structure will levy tax directly on taxable income, at the following rates: • 11 per cent on taxable income up to $35,000; • 13 per cent on taxable income over $35,000, up to $100,000; and, • 15 per cent on taxable income over $100,000. These rates will be phased in over three years. When fully implemented, about 70 per cent of all Saskatchewan taxpayers will pay income tax at a rate equal to residents of Alberta. Third, we will provide significantly higher non-refundable tax credits to support Saskatchewan families. On full implementation, Saskatchewan people will be able to claim: • a basic tax credit of $8,000; • a spousal or equivalent-to-spouse credit of $8,000; • a child tax credit of $2,500 per dependent child; and, • a senior’s supplemental credit of $1,000. With this new tax structure and these new personal tax credits, 55,000 low-income seniors, single parents, minimum wage earners and working families — one out of every eight taxpayers in Saskatchewan — will no longer pay any provincial income tax. Fourth, when fully implemented, our tax system will be indexed to inflation, eliminating “bracket creep.” These changes represent the largest reduction in income tax in the history of our Province. Every Saskatchewan taxpayer will pay less. But the tremendous savings to all residents, and the impact tax reform will have on our economy, has been ignored by many in the recent debate over sales tax. Mr. Speaker, I say again: this is a plan for the future. It is not about buying the short-term good will of people with their own tax dollars. It is about growth and opportunity for Saskatchewan. In order to make our economy competitive, good public policy requires us to adjust other aspects of our tax system. Our provincial sales tax is currently levied at the lowest rate in Canada and on the narrowest consumer base. This under-utilization of our sales tax is a primary cause for high personal income tax rates. Therefore, the sales tax rate will remain at six per cent, and the sales tax base will be broadened to include items taxed elsewhere. However, this Government is not in the business of taxing family necessities. Therefore, we will continue to exclude items such as: • home heating and electricity; • children’s clothing; • insurance premiums; • reading materials; • funeral services; and, • personal services like haircuts. In addition, there will be no provincial sales tax on restaurant meals. I have already stated our commitment that, under our tax reforms, lower income people would be better off. This includes those on fixed incomes and those who do not pay any provincial income tax. I am pleased to announce that, in order to improve tax fairness, our Government will introduce a new, fully refundable Saskatchewan Sales Tax Credit. This credit will provide annual tax savings of $32 million to lower income residents and ensure a fair distribution of the sales tax. With this initiative, Saskatchewan people earning up to $35,000 a year will be eligible for a sales tax credit administered in conjunction with the federal GST rebate. Lower income families will receive a sales tax rebate of up to $264 a year to off-set the additional sales tax they may pay. Mr. Speaker, over the past months, Saskatchewan’s long-standing arrangement with First Nations people regarding the issue of taxation has been called into question. A time of widespread tax reform involves change. The introduction of a sales tax rebate to all low income people in Saskatchewan also makes it appropriate to examine past practices. Recent court cases also demonstrate the need to reassess public policy in this regard. These facts — tax reform, introduction of the sales tax rebate to all low income people and court challenges — have prompted a change in policy. Therefore, effective midnight tonight, the provincial sales tax will be extended to off-reserve purchases by First Nations people. With the obligation to pay the sales tax, comes the benefits of the new tax system, including the Saskatchewan Sales Tax Credit, available to low-income First Nations people across the province. Mr. Speaker, this new tax system is simple. It is fair. It is competitive. It will result in enhanced tax fairness and progressivity. It will contribute to building our future of growth and opportunity, while ensuring that everyone is better off. Our new tax system will begin in 2001. But our commitment is to lower personal taxes every year, as we have done since 1995. I am pleased to announce that, effective July 1, 2000, Saskatchewan’s flat tax will be cut in half, from two per cent to one per cent. The combined impact of all tax measures in 2000 will be a reduction of $200 in provincial taxes for the average Saskatchewan family, growing to about $1,000 a year by 2003. A Future of Growth and Opportunity Mr. Speaker, let me close by saying this: Now is the time to reach beyond our limitations. To build on a decade’s work — a century’s work — to use our strength as a people and our blessings as a Province to create a new generation of growth and opportunity. For that is what a society is about. That is what Saskatchewan is about. Our journey into the future will not be free from challenges or from change. But this Budget puts us on a firm course to achieve opportunity and growth for all. Let us have the courage — the spirit — to lead change, not to follow. To face challenge, not to back away. To do what is fair and what makes sense for our Province and our people, building a stronger, more prosperous Saskatchewan for us and our children.