ANGER OVER EQUALIZATION

Premier Scott Moe says Ottawa pulled A fast one By Burying extension to the Contentious funding formula in a massive Budget Bill.

Saskatchewan’s premier says the federal government quietly renewed the country’s equalization formula — which he believes is unfair — for five years without consulting the provinces.

The federal Liberals, however, maintain that not only were the provincial finance ministers aware of the planned renewal, but it was in a piece of legislation introduced in March and passed two weeks ago.

In an interview, Premier Scott Moe acknowledged knowing that Ottawa preferred to maintain the status quo, but suggested the federal government buried the renewal — which runs through 2024 — in the massive bill.

“There’s so much material in there that, you know, things like this are able to be snuck through,” Moe said of the 582-page Budget Implementation Act 2018, which received royal assent on Thursday.

Equalization, which redistributes federal tax dollars to “have not” provinces, has long been a source of frustration in resourcerich Western Canada.

Earlier this week, Moe unveiled his “50-50” proposal, which would split half the $18-billion equalization pot among all 10 provinces on a per-capita basis; he hoped to bring it up at a premiers’ meeting next month.

About a day later, the Globe and Mail reported on the Budget Implementation Act’s renewal clause.

The Saskatchewan government cried foul, accusing the Liberals of sneaking the “flawed” renewal through. Politicians from Alberta, another staunch opponent of the formula, and some Conservatives joined the chorus.

Conservative Leader Andrew Scheer declined an interview request. Prince Albert MP Randy Hoback acknowledged that something “must have slipped through the cracks,” while blasting the Liberals for keeping it quiet.

“They didn’t tell anybody they did it; they didn’t consult with the provinces; they didn’t consult or bring it into the House of Commons for debate,” Hoback said.

Saskatoon University MP Brad Trost agreed, noting the federal government likely had little interest in having equalization — which he called a “long-standing irritation for the resource-rich provinces” — “blow up.”

The federal government did not announce its decision in a news release, but the government signalled its intention in an appendix to the 2018 budget and included it in the Budget Implementation Act.

Finance Minister Bill Morneau also mentioned the government’s plan to “maintain the main program parameters” of equalization in a March 28 letter to Saskatchewan Finance Minister Donna Harpauer.

“I will be reaching out to you and the other finance ministers to consult on priorities for the next renewal,” Morneau wrote, apparently referring to 2024.

He was more explicit in a May 15 letter to Alberta Finance Minister Joe Ceci, saying, “The equalization program is being renewed for the April 1, 2019 to March 31, 2024 period … in Bill C-74.”

Dan Lauzon, a spokesman for Morneau, said the government’s decision came after “over a year of intense discussion and consultation,” including an in-depth discussion at a finance ministers’ meeting in December.

Last year, six “have not” provinces received equalization payments: Manitoba, Ontario, Quebec, Nova Scotia, New Brunswick and Prince Edward Island. Quebec received $11.7 billion, or 65 per cent of the total.

While Moe’s objections are shared by other leaders across Western Canada and in Newfoundland and Labrador, he is understood to be facing an uphill battle when it comes to convincing other provinces his proposal has merit.

Alberta’s NDP government said this week it is reviewing Moe’s plan.

The biggest obstacle is likely to be Quebec, which Moe has singled out in news releases and interviews as the country’s largest recipient of equalization payments for more than a decade.

His proposal would effectively reduce Quebec’s equalization payment by $3.6 billion, Manitoba’s by $674 million, Nova Scotia’s by $716 million and P.E.I.’s by $171 million. Ontario would receive an additional $3.2 billion.

“We will continue to advance Quebec’s interests and ensure we get our fair share of federal transfers,” Audrey Cloutier, a spokeswoman for Quebec Finance Minister Carlos Leitao, wrote Friday in an email.

While it remains unclear if any other provinces will throw their support behind Moe’s proposal, he said Friday his aim is still to discuss it with the other premiers at a meeting next month.