equalization

Wednesday, December 23, 2015

By Graeme MacKay, Editorial Cartoonist, The Hamilton Spectator - Wednesday, December 2, 2015 Ontario to lose equalization payments as Alberta's economic fortunes fall Ontario will shed its status as a poor cousin of Confederation in the coming years, not because its economic fortunes are rebounding, but because resource-rich Alberta is falling on hard times. The federal government is expected to announce how much each province will receive in the fiscal year 2016-17 from transfer payment programs, which include equalization, before Finance Minister Bill Morneau meets with his provincial and territorial colleagues in Ottawa on Sunday evening. The equalization program redistributes national income to help poorer provinces provide services comparable to those of their richer counterparts. But equalization experts say the formula for calculating the payments is slow to respond to changes, including volatile commodity prices, which will leave Alberta carrying a disproportionate burden when the numbers are announced this weekend. Ontario began receiving equalization for the first time in 2009, a dramatic reversal of fortune for the countryÕs one-time economic powerhouse. It is now set to reclaim its status as a ÒhaveÓ province because the disparity between its economy and that of Alberta is shrinking. ÒWhat weÕre talking about here is the bad way of coming out of equalization,Ó economist Don Drummond said. The Ògood wayÓ to come out of the program, he said, is for a provinceÕs economy to rebound so that growth in its revenues offsets a loss of equalization payments. Because the equalization funding is based on a three-year national average of gross domestic product, next yearÕs calculation will still include times when oil prices were high and Alberta was booming. This means Ontario will not get Òkicked outÓ of the program for another two or three years, Mr. Drummond said. Alberta pulled up the overall standard of living in Canada when the countryÕs wealth was sh

By Graeme MacKay, Editorial Cartoonist, The Hamilton Spectator – Wednesday, December 23, 2015

Ontario to lose equalization payments as Alberta’s economic fortunes fall

Ontario will shed its status as a poor cousin of Confederation in the coming years, not because its economic fortunes are rebounding, but because resource-rich Alberta is falling on hard times.

2005

The federal government is expected to announce how much each province will receive in the fiscal year 2016-17 from transfer payment programs, which include equalization, before Finance Minister Bill Morneau meets with his provincial and territorial colleagues in Ottawa on Sunday evening.

The equalization program redistributes national income to help poorer provinces provide services comparable to those of their richer counterparts. But equalization experts say the formula for calculating the payments is slow to respond to changes, including volatile commodity prices, which will leave Alberta carrying a disproportionate burden when the numbers are announced this weekend.

2008

Ontario began receiving equalization for the first time in 2009, a dramatic reversal of fortune for the country’s one-time economic powerhouse. It is now set to reclaim its status as a “have” province because the disparity between its economy and that of Alberta is shrinking.

“What we’re talking about here is the bad way of coming out of equalization,” economist Don Drummond said.

The “good way” to come out of the program, he said, is for a province’s economy to rebound so that growth in its revenues offsets a loss of equalization payments.

Because the equalization funding is based on a three-year national average of gross domestic product, next year’s calculation will still include times when oil prices were high and Alberta was booming. This means Ontario will not get “kicked out” of the program for another two or three years, Mr. Drummond said.

2008

Alberta pulled up the overall standard of living in Canada when the country’s wealth was shifting west to the resource-rich provinces. Now that Alberta’s economy is faltering, the reverse is happening. Ontario will no longer be eligible to receive equalization once its standard of living is aligned with a lower national average.

Any province that falls below the national average is eligible for equalization. In fiscal 2015-16, Ottawa distributed $17.3-billion in equalization payments to six provinces. Ontario’s share was $2.4-billion. (Source: Globe & Mail)

Canada, Alberta, Ontario, Rachel Notley, Kathleen Wynne, Christmas, Equalization, have, have-not, province, Christmas, stocking, coal

Friday May 26, 2006

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator - Friday May 26, 2006 Klein threatens to abandon equalization Alberta would pull out of the federal equalization program rather than see the other provinces benefit from its oil and natural gas resources, Premier Ralph Klein said. Klein said on Wednesday he's ready to fight with the eastern provinces to keep Alberta's resource revenues out of the equalization program, which sends federal money to poorer provinces so they can provide services such as health care. At a meeting next month, other premiers are expected to suggest that Alberta's oil revenues can be included in the calculations that determine how much cash each province gets from Ottawa. "This is political showdown," Klein said. "This is also a constitutional issue. Alberta has control and authorization and authority over its resources." And he said he's willing to walk away from the program altogether. But University of Alberta political scientist Steve Patten suggests Klein can't really do that, and his bluster won't go far among the premiers, even if it works to whip up long-standing anti-eastern sentiment among Albertans. Equalization payments come from federal government revenues, such as federal income tax, not from Alberta's bank accounts, Patten said. Pulling out, he said, would have no effect on the program.Ê(Source: CBC News)Êhttp://www.cbc.ca/news/canada/klein-threatens-to-abandon-equalization-1.591424 Canada, Alberta, Ralph Klein, Equalization, federalism, Confederation, panhandlers, finance, transfer, payments

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday May 26, 2006

Klein threatens to abandon equalization

Alberta would pull out of the federal equalization program rather than see the other provinces benefit from its oil and natural gas resources, Premier Ralph Klein said.

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator - Friday October 14, 2005 Alberta to spend $10-million to hand out cheques It is no longer called the "prosperity bonus," but Albertans finally learned yesterday how the provincial government plans to dole out at least $1.4-billion in dividend cheques. Many have been eagerly awaiting the details since Premier Ralph Klein announced in September that a plan was in the works to give all residents, including the homeless, a small slice of the province's ballooning unbudgeted surplus. Fuelled by oil and natural-gas royalties, the surplus could be as high as $8.8-billion this year, Mr. Klein said recently.Ê But the one-time dividend, which government officials now call a "resource rebate," has not been free of controversy. There has been criticism that the money could be better spent -- for example, on eliminating health-care premiums -- and that the $400 cheques may promote national envy of the province's wealth. "I don't know where that comes from," Finance Minister Shirley McClellan told reporters yesterday. The program is expected to cost $10-million to administer. (Source: Globe & Mail)Êhttp://www.theglobeandmail.com/news/national/alberta-to-spend-10-million-to-hand-out-cheques/article18249998/ Canada, Premiers, first ministers, federalism, oil, resource, wealth, Ralph Klein, Alberta

October 14, 2005

Klein said on Wednesday he’s ready to fight with the eastern provinces to keep Alberta’s resource revenues out of the equalization program, which sends federal money to poorer provinces so they can provide services such as health care.

At a meeting next month, other premiers are expected to suggest that Alberta’s oil revenues can be included in the calculations that determine how much cash each province gets from Ottawa.

“This is political showdown,” Klein said. “This is also a constitutional issue. Alberta has control and authorization and authority over its resources.”

And he said he’s willing to walk away from the program altogether.

But University of Alberta political scientist Steve Patten suggests Klein can’t really do that, and his bluster won’t go far among the premiers, even if it works to whip up long-standing anti-eastern sentiment among Albertans.

Equalization payments come from federal government revenues, such as federal income tax, not from Alberta’s bank accounts, Patten said. Pulling out, he said, would have no effect on the program. (Source: CBC News)

 

Wednesday February 15, 2005

Wednesday February 15, 2005By Graeme MacKay, Editorial Cartoonist, The Hamilton Spectator – Wednesday February 15, 2005

Jealous Eye

Prime Minister Paul Martin appeared to take an oblique swipe at Ontario Premier Dalton McGuinty on Monday when he said “all great Ontario governments” have understood the need to help less-prosperous regions of the country. Martin was responding to criticism from McGuinty about an offshore royalties deal signed Monday between Ottawa and the governments of Newfoundland and Nova Scotia.

McGuinty complained last week of a $23-billion gap between what Ontario contributes to federal coffers and how much it receives in return.

But Martin, who travelled to Newfoundland and Nova Scotia for the official signing of the offshore deals, said federal transfers to Ontario have increased almost 40 per cent in the last five or six years.

And he pointed out that Ontario will receive $2 billion this year and next in increased health transfers – or roughly 40 per cent of the total payout.

“This country is held together by the recognition that we are one nation,” the prime minister told reporters after the signing ceremony in Halifax. (Source: Hamilton Spectator)