Calls for equalization reform rile N.B. premier

OTTAWA • New Brunswick Premier Brian Gallant is pushing back against calls from Alberta and Saskatchewan to reform Canada’s equalization program, saying changes to the formula would be “disastrous” for his province and others.

“Every province has benefited at one point from equalization … which means that it is a program that has helped all provinces and all Canadians at one point or another,” Gallant said in an interview Wednesday. “It really is built with the idea that we are going to be able to provide all Canadians a better quality of life when we have the safeguards and support of having our federation linked together.”

The equalization program has come under fire after the Globe and Mail reported last week that the Liberals had quietly renewed the formula, without changes, until 2024. The program doles out federal cash to even the fiscal playing field and ensure roughly equal services across all provinces. This year, the “have” provinces that will not receive equalization payments are British Columbia, Alberta, Saskatchewan and Newfoundland and Labrador.

Saskatchewan Premier Scott Moe and Alberta opposition leader Jason Kenney were quick to cry foul over the renewal, with Kenney declaring that Prime Minister Justin Trudeau had “just pulled a fast one on Alberta.”

Moe has proposed his own alternative in a letter to the prime minister and the other premiers, suggesting the program should be cut in half, with the remaining funds distributed among all provinces on a per-capita basis. He argues that would ensure that all provinces at least get some money.

But Gallant said Moe’s proposal would cut New Brunswick’s equalization payment — $1.87 billion this year — by more than $700 million.

“(It) would have a disastrous impact on our ability to be able to invest in education and ensure that New Brunswickers have strong health care,” he said.

Moe has calculated that Saskatchewan would have received $300 million if his formula had been in effect this year, less than two per cent of the $19-billion equalization fund.

But Gallant, who will be chairing a meeting of Canada’s provincial and territorial premiers in Saint Andrews, N.B. in July, said even that amount would be a huge change for New Brunswick. “To give the impression that a $300-million change for one province is small, I think demonstrates that they don’t recognize to what extent it would have a negative impact on a province like ours,” he said.

“We have a deficit that’s actually under $200 million and people are still criticizing us for not having balanced the books yet.”