Agreed. Thank you. Revenues, recoveries and transfer payments. Mr. Braden.

Thank you, Madam Chair. On the revenue side of taxation, I would just like some clarification. Do the numbers posted here reflect the increases that would come, pending approval of the taxation measures that the Minister has proposed? Are those numbers reflected in the projection here? Thank you, Madam Chair.

Thank you, Mr. Braden. Mr. Roland.

Thank you, Madam Chair. Yes, they are reflected in these numbers.

Thank you. Mr. Braden. Ms. Lee.

Thank you, Madam Chair. I have a question on a couple of items. On the first one under transfer payments, Canada health and social transfer, I noticed that the breakdown is different this year, and I'm interested in some explanation as to why that may be. Is it just a simple breakdown? In previous years, the transfer payments for health and social services were all combined. It appears to me, on this line here, for the upcoming year it has been broken down.

The second question I have on that item is could I get an explanation of the increase under this transfer from 2002-2003? Where it was in the amount of $31 million, now we are seeing a combined transfer of $23 million plus. So may I just get an explanation on that, please? Thank you.

Thank you, Ms. Lee. Mr. Roland.

Thank you, Madam Chair. The change is a result of how the federal government treats that. Initially, it was combined under the Canada health and social transfer. They have now broken it down into the two pots there: the Canada social transfer and the reform fund. The actual breakdown and the lesser amount equates to the treatment that it receives under the formula and the taxation situation. For more detail, I will have Ms. Melhorn give that.

Thank you. Ms. Melhorn.

Thank you, Ms. Melhorn. Ms. Lee.

Thank you. I think you managed here. In that case then, the announcements for additional funding that we're getting from the federal government -- there have been a couple of them in the last while -- where would that appear? Would that appear under the Department of Health, or would it appear on this page somewhere? Thank you.

Thank you, Ms. Lee. Mr. Roland.

Thank you, Madam Chair. That would appear in the reform fund portion, and it would be a portion of the Canada social transfer. So it's accounted for in this section of revenues.

Thank you, Mr. Roland. Ms. Lee.

Thank you, Madam Chair. Does that mean that on net we are getting less in this fiscal year than we did two years ago? Is that a correct interpretation? Thank you.

Thank you, Ms. Lee. Mr. Roland.

Thank you, Madam Chair. It would be more a reflection of prior year adjustments that would show up in your 2002-2003 actuals. Our concern is that we continue to be affected negatively. As stated, the estimates of this year coming from Canada are reflected on previous year's corporate tax numbers and personal income tax numbers. So that accounts for some of the changes in the numbers you see here.

Thank you, Mr. Roland. Ms. Lee.

Thank you, Madam Chair. I have a question on the personal income tax item there. We are seeing an increase of $7 million from the 2002-2003 fiscal year to the fiscal year of 2003-2004, prior to any increase in personal income tax that is being proposed in this year's budget. So I am interested in knowing what explains that $7 million increase, considering that it was my understanding that we had in fact increased the personal tax exemption, which I understood would decrease the income from personal income tax. Or is that exemption taken out somewhere else and is this gross personal income tax revenue? Thank you, Madam Chair.

Thank you, Ms. Lee. Mr. Roland.

Thank you, Madam Chair. Using the comparison between the 2003-04 main estimates to the 2004-05 proposed main estimates, we have included the income of $700,000 from the two highest tax brackets in additional revenue, but also a $1.3 million reduction in the two lowest tax brackets that comes into effect January 1, 2005. So by adjusting the two lowest brackets and incorporating the two highest bracket increases, that nets out and it's slightly less than what we would have gotten if we did not make the adjustment for the low-income side. Thank you.

Thank you, Mr. Roland. Ms. Lee.