John Ivison does a nice job of putting some context around the federal/provincial wrangling that has once again erupted, this time inspired by the recent budget.
In Mr. Harper’s Old Testament view of the world, he needed to get even and in Tuesday’s budget he did. Newfoundland and Labrador is now the second richest province in Confederation, on a per capita basis. It no longer receives equalization payments as a “have†province but because of two separate deals known as the Atlantic Accords it still receives “offset†money – in reality, bonus cash aimed at helping transition from “have-not†to “have†status.
Over the next three years, those payments were expected to total $2.5-billion but, without warning or explanation, the budget cut that number by around $1-billion. There’s no doubt that this violates the Atlantic Accords or that the manner in which the changes were communicated was conduct unbecoming a federal government.
But these are strange days and, to borrow Mr. Williams indelicate phrase, the fact is that it was the taxpayers in the rest of Canada who were getting the shaft under the old arrangement. The second richest province in the country was, de facto, continuing to receive equalization payments, even though it no longer qualified. It will still receive around $1.5-billion over the next three years when the offset payments run out — that’s $3,000 for every man, woman and child on the Rock. That is in addition to the $2-billion “signing bonus†the province got in 2005 for inking a second Atlantic Accord.
He goes on:
Given his electoral ambitions in the province, it was equally certain that Liberal leader Michael Ignatieff would offer words of sympathy for Mr. Charest. “It’s about fairness and equity in our federation,†he said.
Are these people sniffing glue? Quebec will get $8.3-billion of the $14.2-billion pot of equalization money next year, in addition to $5.7-billion in health transfers and around $2.5-billion in social transfers.
As Ted Menzies, the parliamentary secretary for finance, pointed out in the House on Wednesday, equalization payments to Quebec have risen 74% since the Conservatives came to power in 2006.
