Province deserves more cash from feds, group says

A group created to highlight Alberta’s contributions to Canada is calling on Ottawa to revert to the original stabilization formula and increase the province’s 2016 and 2017 stabilization payment.

Fairness Alberta released an analysis of Canada’s Fiscal Stabilization Fund on Monday, saying in light of Albertans’ $324-billion net contribution since 2000, the 2016 and 2017 payment should increase to $6.996 billion from $500 million.

Alberta’s revenues fell by $8 billion in 2015-16, but it only earned a “stabilization” payment of $248 million, covering 3.1 per cent of that loss, the news release from Fairness Alberta said.

Executive director Bill Bewick, who was formerly the director of policy for the Alberta Wildrose Party, said delivering on a $2.4-billion request from the provinces would be welcome, and it would be fair to use the 1967 formula.

“Albertans have never shied away from doing our part to help Canada — all we are asking for is some reciprocity as we deal with multiple blows to our economy,” he said in the release.

Citing a February article from economist Trevor Tombe, Fairness Alberta said the various amendments to the Fiscal Stabilization Fund over the last 55 years and the $60 per capita cap mean Alberta cannot be eligible for more than roughly $250 million, regardless of how much the province’s revenue might drop.

Tombe estimated that under the original 1967 formula, which excluded the first five per cent of lost revenue, Alberta would have received a $6.996-billion payment for the profound two-year drop in revenues.

In 2019, economist Bev Dahlby argued it was time to reform the equalization program by lifting the per capita cap and revising calculation formulas “because they do not provide adequate fiscal insurance when there are declines in resource revenues.”

Fairness Alberta recently launched a billboard and online campaign to advertise that Albertans have contributed more than $324 billion to the rest of Canada since 2000.

Albertans contributed an average of $18.2 billion more per year to Ottawa than they received from 2015 to 2018, according to the analysis.

For a family of four, that works out to nearly $18,000 per year during the downturn.

The 20-year cumulative total is a $318,000 contribution per Alberta family, and a $42,000 benefit for families across Canada.

“This is about fairness and support of a province whose taxes have supported all parts of Canada for a long time,” Bewick said.