Liberals must resist pressure from business and Reform Party to recklessly slash taxes

EDMONTON - Members of the federal government are allowing themselves to be unduly swayed by pressure from the Reform Party and other advocates of radical tax cuts - and ordinary Canadians will pay the price, says the president of the Alberta Federation of Labour.

"Finance Minister Paul Martin tells us that there needs to be a broad public debate among Canadians about what should be done with budgetary surpluses," says Cormack. "But based on his remarks yesterday, it appears that the debate is already over - and Preston Manning and the National Post won."

Cormack's comments were made in the wake of a speech delivered by Martin yesterday afternoon to the House of Commons Standing Committee on Finance. In the speech, Martin promised that tax cuts would become one of the government's main priorities over the next few years. No promises were made about increased funding for Medicare or other important government services.

The speech was a great disappointment for advocates of public health care and supporters of other programs and services aimed at improving the lives of middle and low-income families, says Cormack. She also says the federal government is missing an important opportunity to fix damage to public services and infrastructure caused by years of brutal budget cuts.

"The foundations of important public programs like Medicare have been seriously weakened by years of under-funding," says Cormack. "Canadians want to see these programs protected and strengthened - but that's not going to happen unless the government makes a more substantial financial commitment."

Cormack says the country's biggest threat now comes not from debt or inflation, but from people in conservative business, media and political circles who are calling for deep tax cuts. Cormack says such cuts will rob the government of the revenue needed to properly fund public services.

"If the government wants to maintain the quality and accessibility of public services like Medicare then it is imperative that they resist pressure from the Preston Mannings and Conrad Blacks of the world," says Cormack. "Reckless and irresponsible tax cuts may help wealthy individuals and corporations pad their bank accounts - but, for the vast majority of Canadians, these kinds of cuts will do much more harm than good."

Instead of yielding to pressure from right-wing ideologues, Cormack says the federal Liberals should listen to the majority of working Canadians who want more attention paid to public programs and services. In particular, she says surplus funds should be used to shore up Medicare; to repair and expand the country's crumbling infrastructure; to increase access to UI benefits for the unemployed; and to finance new initiatives like a national daycare system and a nation-wide Pharmacare plan.

Reforms need to be made to Canada's tax system, Cormack admitted, but she says they should be aimed exclusively at low and middle-income earners - not high-flying CEOs and managers. An increase in the basic personal exemption; the introduction of more progressive tax brackets; or the full indexation of tax brackets to inflation are the only kinds of changes that could be justified, she says.

"Paul Martin and the federal Liberals are playing a dangerous game," concludes Cormack. "Reckless and poorly-planned tax cuts could spell the end for Medicare and other public programs that have helped define Canada as a nation. Let's just hope the Liberals come to their sense before they follow Preston Manning and Conrad Black off a cliff."

For more information call:

Audrey Cormack, AFL President @483-3021(wk)/499-6530(cell)428-9367(hm)

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