Dear Constituents,

I hope you and your family had a safe and enjoyable Christmas and a good start for the New Year.

Reflecting on the past year for me, 2006 was very busy and challenging. It started with an election in January and a new Parliament. There was also a Leadership Convention in December at which Stephane Dion was elected Leader of the Liberal Party and who assumed the position of Leader of the Official Opposition. It took a little time getting comfortable with my new responsibilities but as it turned out, 2006 was very gratifying and memorable for me personally.

I have always been very active in the House of Commons and at Committees. My experience and knowledge of the practices and procedures of Parliament have opened up the opportunity for me to spend most of my time in the Chamber both monitoring procedural activity and frequently participating in debate.

In the last Parliament, I was ranked number one in speaking in the House and that ranking continues in the current Parliament. On November 21st, I was also honoured by Members of Parliament from all Parties by being voted as the “Hardest-working Parliamentarian for 2006”. On the cover I am pictured receiving that special award at the National Gallery in Ottawa and further details are included in this report.

Also included in this report is my annual article on Income Tax Tips (on how you may save some money on your taxes) plus other articles which I hope you will find to be of interest. As always, your comments and suggestions are most welcome.

Sincerely,

Paul Szabo

Ottawa's finest
Meet the winners of the first annual Parliamentarian of the Year awards

Kady O'Malley, Macleans.ca | Updated Thursday, November 23, 2006

OTTAWA - Politicians and politics junkies from across the partisan spectrum came together on Tuesday night to pay tribute to the winners of the first annual Parliamentarian of the Year awards.

Hosted by Maclean's, L’Actualite and the Dominion Institute, the event was created to remind Canadians that the House of Commons is more than just a backdrop for partisan theatrics.

“The work that parliamentarians do is worthy of recognition,” explained Dominion Institute president Rudyard Griffith. “We have an opportunity to raise the bar, not only in terms of public awareness, but also amongst MPs themselves, who are going to realize that if you want this award there are some criteria and standards to meet, so let’s try to strive to be our best - regardless of what happens in Question Period.”

Last October, MPs were surveyed by Ipsos-Reid, which weighted the questionnaire to prevent the results from skewing toward members of the largest party. Without further ado, then, the winners' circle - along with the words some of the honourees shared with Macleans.ca after learning they'd been voted best in class by their parliamentary peers.

Parliamentarian of the Year and Best Orator: Ralph Goodale (Lib)

“It feels very good for two reasons – first of all, that organizations like Maclean's, L’Actualite and the Dominion Institute would take the time and make the effort to have an event that recognizes the institution of Parliament, and people who work there. It’s a nice change of pace. Also, the voting for the various categories was done by your colleagues - not just your partisan colleagues but all members of the House, so it’s a non-partisan acknowledgement from the your peer group, and that makes it extra special. It will have an impact on awareness, and even on how people conduct their business – it’s a good thing to do, and I hope these become regular awards, so that future generations of parliamentarians can take part.”

Hardest-working: Paul Szabo (Liberal )

“It’s a wonderful feeling. It’s so very nice to be acknowledged by your colleagues, but this award is for all Members of Parliament who share a common bond, as part of a profession that is not held in high esteem. This award, or recognition is on behalf of all of the men and women who are MPs, and we all work hard. There are other MPs who are work equally as hard in committee, or in their constituencies, and their contribution is equal. This is really a night to recognize all of the men and women who are working as MPs in the House for their hard work and dedication.”

Best Constituent Representative and Most Collegial: Peter Stoffer (NDP)

“It’s great fun, and I thank the academy for this award, but there’s a serious side to all of this as well. Ralph [Goodale] said it very well: Parliament is sometimes maligned, and politicians as a profession are maligned. The perception is that we can’t get along, and we’re all partisan. This breaks that stereotype, and shows that we can appreciate each other.”

Most Knowledgeable (three-way tie): Stephen Harper (Conservative), Ralph Goodale (Liberal), Bill Blaikie (NDP)

With just five awards to hand out, and 308 parliamentarians up for consideration in every category, most of the MPs who showed up were well aware that there was a good chance they’d be leaving empty-handed. But this was one event where, it seems, it really was an honour just to be nominated – and normally combative MPs had nothing but nice things to say about each other.

“I think it’s a great idea," Finance Minister Jim Flaherty enthused. "I spent more than ten years in the Ontario legislature and I think it’s great to build up spirit in all parties, and in the parliamentary tradition and the importance of Parliament itself. I’ve noticed there is more collegiality here – partly because so many of us are here away from our usual homes, so there is more opportunity for camaraderie.”

Bill Graham was particularly pleased that his former cabinet colleague had won the top prize, but he singled out each of the winners for praise. “Ralph’s award was extremely merited," the acting Liberal leader said. "He’s worked so hard, and he’s a great parliamentarian, as well as a strategist, and strong on policy. He’s devoted his life to this, and everyone knows that Paul Szabo has shone as someone who has organized us in the House. Finally, I can tell you that Peter Stoffer really is one of the most collegial MPs, and he’s a credit to his party because of that. Some people get ahead by being forceful and adversarial, but others do it by working with people. Peter Stoffer is one of those people.”

Along with Maclean's, L’Actualite and the Dominion Institute, the event's sponsors were proud of the message it sent both to parliamentarians and the general public.

“It’s an important event, and it’s always good to honour public officials, and we’re happy that the Canadian government is doing that," said Oracle's Kevin Curry. "It is government honouring its own, and that’s very important.”

“We got involved because of the purpose behind the event, which is to highlight that beyond the public perception, we have hardworking Members of Parliament who are very knowledgeable and very good with constituents," Pfizer Canada's Steven Hogue added.

"Sadly, we often only hear the negative stories about MPs and government in general, but there are a lot of positive stories out there.”

Maclean’s Magazine - December 04, 2006 - NICHOLAS KÖHLER

Parliamentarian of the Year: Paul Szabo

The Workhorse

Paul Szabo admits to drinking three or four cups of coffee a day. Staffers at his Toronto-area riding put the number higher. Much higher. "He should buy stock in Tim Hortons," says Irene Corridore, who's worked for the Liberal -- Canada's hardest-working MP, according to his colleagues -- for most of his 13 years on the Hill. There's a Tim's across the street from his Mississauga South office -- a persistent invitation he finds hard to resist. He drinks his coffee black, and downs 10 to 12 a day.

How else to fuel his relentless drive? Szabo, 58, has launched some 40 private member's bills and motions and, as a backbencher in Paul Martin's 14-month government, uttered a staggering 154,683 words in the House -- more than any other MP. He has spent Christmas vacations writing books on fetal alcohol syndrome, and wedding anniversaries at international conferences. He has filibustered a bill he believed could permit human cloning, and staged delicate backbench revolts against same-sex marriage. "He doesn't have to be the pitcher -- he's prepared to play second base," says Liberal MP Derek Lee. Szabo prefers more earthy metaphors: "I like to grind out sausages," he says, of his work.

In Ottawa, the former chartered accountant kips a block from the Hill. "I walk back to my little hotel room and there's a bed and a bathroom and that's good," he says. He rises at 5 or 6 a.m. and doesn't return until after Lloyd Robertson's nightly spiel. Some days -- when preparing to bombard a bill with amendments, say, as he did with his own party's reproductive technologies legislation some years ago (he looks askance at stem cell research) -- Szabo will stay in his office into the wee hours. "The man works when he's sleeping," says his 24-year-old daughter, Whitney, whose mother tells of 2 a.m. jottings in a notebook by his bed.

Twice Szabo has watched a bill he's introduced seeking warning labels on alcohol come within a hair of passing; its latest iteration, he says, will likely die with this government. And yet, though such manoeuvres be thankless, he continues -- grinding out sausages.

Although I no longer operate my Chartered Accounting practice, I still do tax returns for family members and some friends. It’s a good way for me to keep up with tax changes and, from time to time, I have found that some still don’t take advantage of savings opportunities.

Everybody has a different situation and every tip may not be applicable to you. However, in my experience, most taxpayers could find savings if they took the time to assess their choices. Below are a few tips which could save you money. Note that the figures that I have used are for the 2006 tax year. Some of these are indexed and will change slightly from year to year.

• Medical Expenses – Everyone can receive a 15.25% tax credit for eligible medical expenses which exceed the lesser of 3% of your net income or $1,884. First of all, check the tax guide to ensure that you know what is eligible. The list is long and includes things like premiums for private insurance and medical devices and aids. The next thing to know is that one spouse can and usually should claim all the expenses for the entire family (ie including dependent children. This makes a difference because if the spouse with the lowest income claims all the expenses, the 3% reduction will be less and the credit will be more unless both spouses make about the same income.
  
  Finally, in any tax year you can claim medical expenses for any 12-month period which ends in the tax year. If you have large expense in the fall of one year and another large one in the summer of the next year, you may be better off by claiming them both on the same tax return. Taking this one step further, you may want to schedule appointments for medical or dental or vision care expenses before year end or delay until the new year depending on what other costs you have had or are expecting. If you had $1,000 in one year and $1,000 in the next you may not get any tax credit in either year but if you claimed them both on the second tax return, you would save money regardless of how much you make.
  
  You should also be aware that there is a Refundable Medical Expense Supplement of up to $1,000 for those with very high medical expenses and modest income. This is worth checking into.
  
• Charitable Donations – Regardless of which spouse or dependent made a charitable donation, one spouse can and usually should claim them all. This can make a difference because the federal tax credit is 15.25% on the first $200 and 29% on everything over that. If both spouses made donations of $200 and each claimed their own you would only get 15.25% federal credit on the entire amount. If one claimed both donations, $200 would be at 15.25% and $200 would be at 29%. The provincial tax credit also increases. You should also be aware that donations can be carried forward for 5 years. That means that you may be better off delaying the claim for charitable donations and combine them in the following year which could maximize the amount eligible for the higher credit. The increased savings is likely more than you could earn in interest by taking the credit early remembering that any interest earned is taxable.
  
  There are also some amended rules related to the gifting of publicly traded shares to charities. Check the tax guidelines to see if donating a gift of capital property is a better way for you to support the charity of your choice.
  
• Provincial Sales Tax Credit – If you have a child who is 16 to 18 years of age in the taxation year and if you received no Child Tax Benefit for them from the federal government, they can actually file their own tax return and claim the $100 sales tax credit and receive a refund cheque for $100 as long as their income is less than $4,000. If you claim them on your return, the credit is only $50. Only one parent can claim for both spouses and any dependents and their tax credits are reduced by 2% of the total family net income in excess of about $4,000.
  
  In many cases, the income is too high to get any tax credit. That is another reason why a 16 to 18 year old should file a return. They will need a Social Insurance Number so if they do not have a card, now is a good time to get one. You may also have children who are over 18 years of age but are still in school or otherwise make no income. Make sure that they file a return as well to get their $100 provincial tax credit.
  
• Goods and Services Tax Credit – One spouse must claim the GST tax credit for both spouses and any dependent children. The credit is $232 for each spouse and $122 for each dependent child. This credit is reduced by 5% of the excess family income over $30,270. If you have a child who is 19 or older in the tax year, make sure they file their own return and claim the GST credit. It is worth $232 just for filing a return. Taken with the Provincial sales tax credit, a child over 18 years of age can actually receive $332 just for filing a return which they can do even if they have no income.
  
• Income Splitting – As a general rule, a couple will pay less tax if their income is split evenly. This is rarely the case so you may want to look for ways to shift income from the higher earning spouse to the lower. Investment income is usually a good place to start. If the higher earning spouse pays all the bills etc out of their bank account and the lower spouse uses their income to invest in GICs etc, all of the investment income can be claimed by lower income spouse. Too often couples have one bank account and often one taxpayer will claim all the income earned. If you have a joint account, you can split the income between both spouses even though the T5 tax slip is in the name of one spouse. You should also be aware that those who receive a Canada Pension Plan benefit can choose to split up to 50% of their pension with their spouse. In most cases, this will reduce the total tax bill of the couple. In 2007, there are new tax rules coming out related a change which will allow pensioners to split income for tax purposes. The rules are not finalized yet but look at this carefully to maximize your tax savings.
  
  Did you know that your spouse could earn up to $751 in 2006 without reducing the amount of the Spousal Personal Credit. This means that if one spouse has no income you could earn $751 of interest income tax free. This is just another reason why you should look for ways to get some investment or other income into the hands of a spouse for tax purposes.
  
• Tuition and Education Tax Credits - When a child goes to a qualified post secondary institution, the student receives a tax slip for tuition and education tax credits. If the student has income less than $8,839 from part time or summer employment, these credits are carried forward to future years. Alternatively, the student can transfer up to $5,000 to a parent or grandparent each year. Tax credits carried forward for years do not increase in value and therefore it is worthwhile to make the transfer and reduce the tax of the parent who usually has paid the tuition. In the event that the student is actually funding their own education it is still worthwhile because the parent can give them the tax savings to help pay for their ongoing education or to invest and earn interest.
  
  Gifts of money to a dependent who 19 or over are permitted and the income that is earned is taxable income in the hands of the dependent. If the dependent is under 19, the income is includable in the income of the parent.

There are quite a number of other areas where tax savings may be achieved and for which you may be eligible. These include:

• Eligible Dependant Personal Credit – where there is no spouse but you have a dependent child or other person.
• Pension Income Credit – 15.25% of the first $2,000 of pension income.
• Caregiver Credit – where the dependent’s net income is less than $13,431.
• Infirmed Dependants Credit – where the dependent is over 17 years of age and their net income is less than $5,581.
• Adoption Expenses Tax Credit – 15.25% of net eligible expenses up to a maximum of $10,000.
• Disability Credit and Disability Supplement
• Interest on student loans – 15.25% of interest paid
• Political Donations – 75% of the first $400, 50% of the next $350 and one third of any additional amounts. The maximum credit is $650. In 2007, donations are limited to $1,000.
• Public Transit Passes Credit - !5.25% effective July 1, 2006

I hope that some of these tips have helped you think of possible savings opportunities. If your situation is complicated, seek assistance from the income tax office or a reputable tax return preparing service. The key is to handle the family like one taxpayer and reduce the family taxes. That means preparing the returns for all family members at the same time will help you to identify tax saving opportunities.

New National Security arrangements with the United States will affect travel documents needed to travel to the US by Canadians.

Air Travel

As of January 23, 2007, the United States' Western Hemisphere Travel Initiative (WHTI) will require Canadian citizens to present one of the following documents when entering or transiting the United States by air:

• A valid Canadian passport;
• A NEXUS Air card when used at a NEXUS Air kiosk

Canadians entering or transiting the United States by air without the required documentation will likely be referred for secondary screening, where U.S. Customs and Border Protection officers will evaluate any evidence of citizenship and identity. As a result, Canadians without the required documentation may be prevented from boarding their flights. Travellers should obtain the appropriate required documentation before leaving Canada.

Land and Sea Travel

The implementation of these measures for all land and sea travel to the United States will come into effect as early as January 1, 2008, and no later than June 1, 2009. The exact date of implementation will depend on when the U.S. Department of State and the U.S. Department of Homeland Security meet certain conditions set out by the United States Congress on technology, infrastructure, and training for border officers.

For more information, visit www.passportcanada.gc.ca or call toll-free 1-800-567-6868. If you expect to be travelling to the US in the near future and you do not currently have a valid passport, you are encouraged to apply as soon as possible. It can take some time to get one and the offices are extremely busy due to the changes.

On November 4, 2006, I was honoured to be asked to be speaker at the 2006 Law and Parliament Conference in Ottawa. Sponsored by Parliament and the Canadian Bar Association, this year’s topic was “Accountability as a Pillar of Democratic Governing”.

One of the most notable issues was resolving the definition of accountability. Some suggested that it was more an issue of doing the right thing after things went wrong while others stressed doing things which would prevent things from going wrong. In my view, accountability requires both.

In my speech, I suggested that someone was accountable if they explained or justified their actions or decisions in a manner which was true, full and plain. No system of governance, management or security can guaranty that something could not go wrong. However, those in charge must take all reasonable steps to prevent or deter problems.

In December, Parliament unanimously passed Bill C-2 on accountability. It took 6 months and over 90 amendments and on balance, it is a good start. The Bill builds on the whistleblower protection legislation which passed at the end of the last Parliament and which I had worked on for 3 years.

The whistleblower Bill effectively provides protection and support for civil servants throughout government who bring forward allegations of wrongdoing. They will have a mechanism to use which will protect their identity and if necessary relocate them to another job. There will be a new Public Service Integrity Officer who will be an Officer of Parliament like the Auditor General who will report direct to Parliament. All department and agencies of government including Crown Corporations will be covered with the exception of the military and National Security.
Bill C2, the Accountability Act, makes amendments to dozens of Acts of Parliament to effect certain changes including:

• Restricting personal political donations to $1,000 per year;
• Prohibiting union and corporate political donations;
• Establishing a new Conflict of Interest Act with a new Conflict of Interest and Ethics Commissioner;
• Establishes a new Commissioner of Lobbying and makes tighter rules guiding the activities of registered lobbyists including a Code of Conduct;
• Creates a new Parliamentary Budget Officer to support Parliamentary Committees with independent analysis;
• Creates a new Public Appointments Commissioner to oversee government appointments;
• Creates a Procurement Ombudsman to review government practices;
• Requires government polls to be publicly released within six months;
• Expands coverage of the Access to Information Act to Crown Corporations, Agencies and Commissions;
• Broadens the powers of the Auditor General to audit individuals and organizations that receive government money;
• Strengthens auditing processes within departments;
• And establishes a new Director of Public Prosecutions to prosecute criminal offences under federal jurisdiction.

These are only a few of the main provisions of the Accountability Act which I hope will demonstrate Parliament’s commitment to improving accountability no matter how one may define it. Government is a very large business operating programs and services legislated by elected representatives on behalf of all Canadians. Hopefully, Bill C2 will help over time to improve public confidence and respect for both their government and their elected representatives.

Visit us on the Internet: www.paulszabo.com

Mississauga Office Hours: Monday to Friday 9 a.m. to 5 p.m. Appointments can be scheduled during office hours or other arrangements can be made by calling the office.

Constituents may write to any Member of Parliament or Cabinet Minister postage free. Simply address your envelope to the particular Member, c/o House of Commons, Ottawa, Ontario K1A 0A6. Your views and suggestions are important.

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