Equalization unsustainable: Flaherty

I just heard Finance Minister Jim Flaherty say that the Equalization program as currently structured is unsustainable. The New Brunswick government has relied on tens of millions more each year in Equalization and it is now the single largest source of revenue the province takes in.

The interesting thing is that the program was enriched by Harper when he first got in to appease Quebec. I would be curious to see if this is Harper firing a shot over the bow of Quebeckers so to speak. The Harper giveth. The Harper taketh away. Because any major changes to equalization will be most acutely felt in Quebec because it gets the most (on a dollar basis).

The reality is the Graham, McGuire et. al. were right back in 2006 when they framed the debate about self-sufficiency.

However, they have yet to show a pathway to less equalization. The last forecast I saw predicted additional increases every year until at least 2010/2011.

It’s one thing to know what needs to be done. It’s quite another thing to actually do it.

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0 Responses to Equalization unsustainable: Flaherty

  1. Anonymous says:

    Ontario not on Ottawa’s radar
    The Star:

    Nor was there any reference to the Ontario government’s demands for “fairness” in federal fiscal arrangements, including health-care transfers and Employment Insurance. (Under both federal programs, Ontario gets proportionately less than the rest of the country.)

    There was, however, an ominous suggestion that the federal equalization program will be restructured to make it more “sustainable.” This likely means a rewriting of the rules to make sure Ontario will not qualify for equalization payments to which it would otherwise likely be entitled in the next year or two. (There is a precedent, in the early 1980s, for such a pre-emptive change in the rules to prevent Ontario from becoming an equalization recipient.)

    Graham, McGuire et. al. were right? self-sufficiency in NB!
    You mean cutting back on the huge salaries,pension plans,expense accounts,subsidizing,special wage benefits for french speakers, such as the millions giving to Irving for new reefers? and etc, of the provinces elite?
    Or you mean cutting back on seniors,children’s allowance,schools,local farmers.
    Self-sufficiency takes some getting used too and when McCains pulls the plug,a lot will find out,but oh no,no government privileged will ever have to worry.

  2. Rob says:

    Does anyone remember the recent headline that read something like this:

    “Increased Federal Funding Key to Self-Sufficiency: Graham”

  3. Anonymous says:

    We lost out on McKenna but having the Minister for ACOA from Fredericton ought to hold promise for economic development in New Brunswick.

    PEI thrived during McGuire’s time at the helm helping to propel their aerospace industry to top ranks in the Maritimes.

    So, our Premier and BNB Minister ought to be in Ottawa tonight waiting to congratulate the new Minister and presenting a concise and focused economic development plan for New Brunswick. And please let it be original; we don’t need to be sucking up the exhaust of NS and PEI with their decade old ideas.

  4. Anonymous says:

    Re Ontario Comments:

    Do a bit of research. Ontario has something called the automotive industry made possible by a government department dedicated to the autopact, then protected via the North American Free Trade Agreement. Without even considering the billions of funding dollars made available through Industry Canada’s Technology Partnership’s program, Ontario has been on the take with government policy wrt to trade and taxation for decades.

    Atlantic Canada has had nothing comparable to that level of commitment and in fact have been negatively impacted by several of the policies that were created to favour Ontario e.g. transportation subsidies.

    Ontario have enjoyed the benefits of Ottawa’s attention for half a century; benefits like automotive welders making $80K per year while a welder in Atlantic Canada might struggle to make $40K. If Ottawa had a fraction of the committment to Atlantic Canada that Ontario has received for their automotive industry, we’d have been a “have” region long ago.