Alberta United Conservative Party leader Jason Kenney says the Trudeau government has “rammed through” an extension of the equalization payment system, calling it a “slap in the face” to Albertans, and he says the Notley government is only too willing to be pushed around.
“It means that Albertans will continue to be forced, even when times are bad in Alberta, forced to subsidize public services in other parts of the country where politicians have been trying to block our pipelines and impair our energy industry.”
Kenney says Albertans don’t object to helping out other parts of the country, but says the current equalization formula benefits other provinces who are helping to block Alberta’s resource development.
“This violates the Canadian sense of fairness, which is why we’ve been calling on the federal and provincial governments to renegotiate equalization along fairer lines.”
On Friday, Alberta NDP finance minister Joe Ceci said he was aware of the federal government’s plan to renew the equalization payment program after he raised concerns several times with federal finance minister Bill Morneau.
READ MORE: Equalization payments – how they work, and why some provinces are upset
“In the letter that (Morneau) sent me in May, he said that the equalization program was going to be unilaterally approved by the federal government.
“There are problems with that in that this Fiscal Stabilization Program wasn’t there for us, so I’ll continue to raise that concern when I go down to Ottawa on Tuesday.”
Ceci hopes that he will be able to convince other finance ministers during their meeting on Tuesday.
“I expect that I’ll be able to bring those concerns to the table. There will be other provinces, notably one to the east, who will say the same things. I expect that my colleagues will spend time with me around the table listening to the challenges that fiscal stabilization had when we went through the toughest recession in two generations.”
WATCH BELOW: Provinces feud over less than equal equalization payments
Ceci reiterated that the fiscal stabilization payments haven’t been adding up for Alberta.
“For decades, this province has contributed to the net wealth of this country, and when we needed the Fiscal Stabilization Program, it wasn’t there for us.
“We dropped $6.5 billion from 2014-15 to 2015-16 and got $251 million in return.”
Kenney said the equalization payment system is negatively impacting more than just Alberta.
“Not only is this current formula not working for Alberta, it’s not working for Canada, which is why we expected a renegotiation of equalization next spring, as scheduled.”
Passed on Thursday, Bill C-74, the budget implementation bill, made amendments to the Federal-Provincial Fiscal Arrangements Act to renew the payments for another five-year period, ending March 31, 2024.
Kenney also said that, in his conversations with premiers from Saskatchewan, Newfoundland and Ontario, the renewal of equalization payments took premiers by surprise.
“As far as I can tell, premiers have been very surprised by this. I talked to Scott Moe about equalization on Tuesday, and he had absolutely no idea this was coming down.
“I think this was clearly an effort to jam this through with the lowest possible profile.”
Kenney says, in the legislature, the UCP has called on the Notley government to call for a renegotiation of equalization, but he says the NDP have sided with Justin Trudeau at the cost of having Northern Gateway and Energy East cancelled, and tanker bans put in place.
LISTEN: Jason Kenney discusses equalization payments renewal with Rob Breakenridge
Kenney says when he was in the federal cabinet, equalization was negotiated with provinces and that Alberta received per-capita health transfer funding.
“The Harper government absolutely (negotiated with provinces). We had the O’Brien report which made recommendations 10 years ago which led to significant changes. And then in the last round, there were further negotiations at the finance ministers’ table.”
LISTEN: University of Calgary economist Trevor Tombe discusses the recent history of equalization payments
“It is a federal-provincial program; it’s not just a unilateral federal program. Seven provincial governments get big cheques out of this. This involves the provinces. Two provinces, effectively through their federal taxes, pay enormously into it. So yes, of course, a mark of good faith would be to consult.
“To spring this on the provinces without any forewarning is slightly bizarre.”
If elected premier, Kenney says he’ll call for a referendum that would bring in binding negotiations with the federal government on equalization.
Kenney says Saskatchewan and Ontario are on board with calling for changes to the equalization program.
When pushed on why he didn’t react to Morneau’s letter in May on the unilateral approval of the equalization payment renewal, Ceci expressed concern over the federal government’s process, saying “I don’t think that’s the right decision.”
“I think that the feds aren’t doing as much as they can for provinces like this that hugely contribute to the wealth of this country.”
With files from Aurelio Perri and Emily Mertz.
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