Kenney calls fiscal stabilization changes ‘slap in the face’

OTTAWA — Alberta Premier Jason Kenney says Ottawa’s recent changes to its fiscal stabilization program are a “slap in the face” to the province, saying they don’t properly account for the hundreds of billions of dollars Alberta has contributed to national revenues over the past few decades.

In its fiscal update on Monday, the federal government announced that it would begin raising the cap on its fiscal stabilization transfer every year in line with inflation. The adjustment effectively raises the cap from $60 per person to $170 in 2020, and ensures the cap will continue to grow at the rate of inflation thereafter.

Fiscal stabilization is among the federal government’s lower-profile transfer programs, distributing money to provinces based on annual revenue losses. Ottawa is likely to pay out around $4 billion to provinces under fiscal stabilization next year, compared with roughly $20 billion under its higher-profile equalization program.

In question period on Wednesday, Kenney said the Liberal government’s changes to fiscal stabilization fell short of provincial recommendations, and were a “slap in the face for the people of Alberta.” He said the province was “shortchanged” by $4.6 billion, after doing much of the “heavy lifting in the history of the federation.”

The premier has for years repeated the claim that Alberta has been cheated out of its fair share of federal transfer payments and has called on Ottawa to make changes. Anger over transfer payments have become more acute in some western provinces in recent years, particularly as the province’s energy industry copes with low oil prices and a lack of new pipeline capacity.