Tories Blame Premiers for Equalization Crisis

So really it wasn't the Gnu Conservative government that failed the Atlantic Provinces it was the other premiers. They insisted that Jim Flaherty come up with an equalization formula that broke their promise not to claw back resource revenues.

From Hansard Thursday June 14

Hon. Jim Flaherty (Minister of Finance, CPC):

Mr. Speaker, as all members know, the premiers had many meetings with the Council of the Federation and they were unable to come to an agreement with respect to the equalization.

The premiers, including all the premiers of the receiving provinces, have been asking for more than two decades for fiscal equity in terms of equalization in Canada and for a 10 province, principle based formula. That is what we have been able to arrive at.

Indeed, the premiers have been asking for a principle based, predictable, long term formula for equalization in Canada. We had an experts panel look at that. Yes, it is necessary that the national government act on this because the premiers could not agree.


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A Deal Is A Deal

Defying the Harpocrites expectations of pulling a fast one over the Atlantic Accord expecting it to all pass by due to the infamous culture of defeat, today their anti-equalization budget faces opposition in the Senate from none other than the Conservative voice of Atlantic Canada; John Crosby. And he is not in favour of the Harpocrites budget. Nope not by a long shot.

Former East Coast Tory godfather John Crosbie sent two me­mos to Prime Minister Stephen Har­per in a vain attempt to convince him to honour the 2005 offshore accords be­tween Ottawa and Nova Scotia and Newfoundland and Labrador.

The memos provide a strong argu­ment in support of those, like Nova Scotia Tory MP Bill Casey, who argue that Mr. Harper and Finance Minister Jim Flaherty have violated the ac­cords with the March budget.

Certainly, few people know more about the issue than Mr. Crosbie, who was instrumental in negotiating the 1980s deals under which the Conserva­tives under Brian Mulroney ceded con­trol of offshore petroleum to Nova Sco­tia and Newfoundland.

“The authors of the Atlantic council report concluded that this government's budget ‘violates the letter and the spirit of the accords,’" said Deputy Leader Michael Ignatieff. “Even former Conservative Minister of Finance John Crosby said ‘they're changing the equalization formula so that it will cancel out the principles of the accord.’

Meanwhile the rage spreads as more Atlantic provinces realize the Tories have created a two tier form of equalization.

While the new equalization formula will provide New Brunswick with a $68-million increase in revenue for the first two years, the province will receive, from 2009 through 2020, a stunning $1.1-billion less than it would have under the existing framework. While Mr. Harper talks about fixing equalization, not only has he broken his promise to honour the Atlantic Accord in Nova Scotia and Newfoundland, but he also has created two classes of equalization.

Acadia University’s Paul Hobson and Memorial’s Wade Locke have done better than running to court. In a study released last week, they ran the numbers on the two equalization options presented in the budget – the old "fixed framework" that uses a five-province standard and the new "O’Brien formula" that upgrades to a 10-province standard, excludes some resource revenues and introduces a cap to claw back equalization if resource revenues push a have-not province above Ontario’s theoretical taxing capacity.

The bottom line: The new system is a financial bust for all four Atlantic provinces over the next 13 years, whether or not they have resource accords with Ottawa.

Jim Bickerton of St. Francis Xavier University in Antigonish believes the political battle surrounding the federal budget underscores a lack of understanding between the federal Conservative government and Atlantic Canada.

Bickerton says any attempt by Ottawa to portray the new equalization deal contained in the recent federal budget as a "fair and generous offer" for Nova Scotia and Newfoundland misses the point about why they were given offshore agreements in the first place.

"The symbolism of this went much deeper than simply just a broken agreement," he says.

Agreements signed in 2005 with Paul Martin’s Liberal government protected the two provinces’ offshore oil and gas revenues from federal equalization clawbacks. After a long and at times dramatic fight dubbed the "Campaign for Fairness," the deals were heralded as key economic development tools.

The current equalization offer forces the provinces to choose between a new formula or their offshore deals, a choice both fear could cost them millions of dollars over the long term.

"The broken trust was that the federal government had more or less admitted that this was the region’s one great opportunity to reverse its historic subordinate position within the federation and that it was willing to support them in doing that," says Bickerton.

Locke's work on equalization and the Atlantic Accord have been followed closely in political circles.

This spring, when he determined that Newfoundland and Labrador would actually benefit from the new equalization formula, federal Conservatives championed his work.

However, Locke dramatically revised his analysis when he obtained full details from the federal Finance Department on how the new equalization formula will work.

He found that Newfoundland and Labrador will not only lose money as compared to the status quo, but the province would have received about $11 billion more over the next 13 years had Prime Minister Stephen Harper maintained a 2006 pledge on equalization.

As an Albertan I empathize with the Maritimes. We were there once, in the thirties, despite our coal reserves, it was not enough to keep us afloat as the feds took the resource monies and gave us back a smidgen called equalization.

It was when we struck oil, and had the oil barons take over the State that we declared our constitutional autonomy through provincial control of our natural resources.

Alberta today pays into the equalization payments to other provinces. Not just Ontario. Which irks me no end when the Conservatives talk about capping equalization at the Ontario level. What about the Alberta level, well they don't want to mention Alberta since that might wake up the sleeping giant which hates Ottawa.

Yep you see the broken promise to Atlantic Canada goes along with a letter sent to Saskatchewan and Alberta promising to respect provincial resource rights and not include them in the equalization formula. Signed by the Grande Fromage his-self.

So once the Atlantic Accord was signed it set the conditions for Nova Scotia and Newfoundland to benefit from their offshore resources just like Alberta and Saskatchewan can from their inland resources.

Those resources being oil and gas. Which seem to be unique when it comes to the federal government. Unlike say mining, or hydro-electric power, two resources Ontario and Quebec have but are never considered part of the equalization formula, past or present.

The federal state controls offshore oil and gas reserves in a paternalistic fashion for the good of the provinces where they are. They still control the offshore resources 'in trust' for Nunavut, until such time as that 'territory' actually becomes a province.

Having to give up such a lucrative source of funds, is hard to do. And the Liberals were forced into expanding the Atlantic Accord originally signed by the Mulroney Conservatives. In doing so they gave the Atlantic provinces their just due.

The Harpocrite Conservative opposition demanded the Martin government honour 'their commitment' made during the 2004 election. A promise Harper went on to reiterate in the 2006 election.

But he broke that promise, by tying the provincial rights to resource revenues to equalization payments, a bit of sugar for two years and then claw backs. Albertans would never stand for this kind of treatment, regardless of the party in power in Ottawa.

And the Atlantic premiers as well as Lorne Calvert are correct in admonishing Albertans that Harpers betrayal bodes ill for us as well. Unfortunately it has fallen on deaf ears since the Calgary School Conservatives dominate both the Federal party and Stelmach's regime in Alberta.

It's a matter of fairness. The Maritimes could well become self sufficient with their oil revenues. And then and only then should equalization payments end, as they have with the former have not province of Alberta.

Equalization & The Atlantic Accord - 'A Deal is A Deal' Petition

Nova Scotia Premier Rodney MacDonald is encouraging all Nova Scotians and all Canadians to send a strong and united message to Ottawa by signing a petition on Nova Scotia's website.

www.gov.ns.ca/accord

The only problem with the petition is there is no space to put your city or province. So I used the space for phone number (optional).




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Humpty Dumpty Conservatives

So who speaks for this Gnu Government. When statements are made in the house, do they really mean what is said.

39th PARLIAMENT, 1st SESSION
EDITED HANSARD • NUMBER 154

Tuesday, May 15, 2007

Hon. Peter MacKay (Minister of Foreign Affairs and Minister of the Atlantic Canada Opportunities Agency, CPC):

Mr. Speaker, what I suspect Nova Scotia and Atlantic MPs will do is support the budget because it is good for Nova Scotia. It in fact allowed the government of Nova Scotia to balance its budget this year.

However, I can tell the member opposite what we will not do. We will not do what the Liberal leader did to the member for Thunder Bay—Superior North.

We will not throw a member out of caucus for voting his conscience.

There will be no whipping, flipping, hiring or firing on budget votes as we saw with the Liberal government.

Or like Humpty Dumpty in Alice in Wonderland do they merely mean what government means them to say to be popular from day to day.

“When I use a word," Humpty Dumpty said in rather a scornful tone, "it means just what I choose it to mean - neither more nor less.”

The Humpty Dumpty Government was on the hook yesterday for flip flopping on that promise.

Casey booted from Tory caucus

Ousted from Tory caucus, MP can't access computer files

Renegade Tory MP from NS says he's the victim of dirty tricks

And when caught out on a lie once again they acted like Humpty Dumpty. Of course after a year and a half in power we should realize that nothing a Minister in this Government says is worth anything unless it comes out of King Stephen's mouth.

Atlantic MPs target Tories over Casey ejection

The MPs said the removal from the Conservative caucus of Bill Casey went against a statement by Foreign Minister Peter MacKay, who had told the House of Commons that the Tories would not be "whipping, flipping, hiring, or firing" any of their members for opposing the bill.

"He stuck to that comment as well as he did the David Orchard agreement and the Atlantic Accord," Nova Scotia Liberal MP Scott Brison told reporters Wednesday.

39th PARLIAMENT, 1st SESSION
EDITED HANSARD • NUMBER 165
Wednesday, June 6, 2007

The Budget

Hon. Jack Layton (Toronto—Danforth, NDP):

Mr. Speaker, last month the minister responsible for Atlantic Canada through ACOA said:

We will not throw a member out of caucus for voting his conscience. There will be no...firing on budget votes as we saw with the Liberal government.

Not only does the government break its promises to the people of Saskatchewan, Newfoundland and Labrador and Nova Scotia, it breaks its promises to its own caucus members.

How can any Canadian have any faith or trust in the word of the government?

The member for Cumberland—Colchester—Musquodoboit Valley has it right, and he has been very dignified in expressing it. The government should apologize to the people of Atlantic Canada. When will that happen?

Some hon. members: Oh, oh!

The Speaker:

Order, please. The hon. government House leader.

Some hon. members: Oh, oh!

Hon. Dominic LeBlanc:

That's the wrong Peter.

Some hon. members: Oh, oh!

The Speaker:

Order, please. I know the hon. government House leader is tremendously popular with all hon. members but we must be able to hear the answer he is about to give. He has risen to answer and we will have a little order, please, so we can all hear the answer.

Hon. Peter Van Loan (Leader of the Government in the House of Commons and Minister for Democratic Reform, CPC):

Mr. Speaker, they have somebody by that name answering the question.

Canada's new government has kept its commitment to Atlantic Canada and Nova Scotia, Newfoundland and Labrador. They are getting 100% of what they were promised in the accord.

If the leader of the NDP believes in what was in the budget, if he believes it is important for us to have things like $225 million for the preservation of environmentally sensitive land, $1.5 billion for clean air and climate change to the provinces, $400 million for the Canada Health Infoway and $612 million to the provinces for the patient wait times guarantee, why did he vote against those last night and why is he against those things that Canadians want?

Ms. Alexa McDonough (Halifax, NDP):

Mr. Speaker, I want to hear an Atlantic minister, with a straight face, tell Atlantic Canadians that they are not getting a bad deal.

Last night's vote killed the Atlantic accord. Only one MP had the decency to vote against breaking the promise.

Is there one Atlantic minister with the guts to tell his constituents that he will do everything in his power to fix the mistake? Will the Minister of Foreign Affairs admit that last night his government broke a promise to Atlantic Canadians?

Some hon. members: Oh, oh!

The Speaker:

I know it is Wednesday but members would not want to waste time with excessive noise. The hon. government House leader has risen to answer what I believe was a question from the member for Halifax. I could hardly hear a word. We will now hear from the government House leader and will have a little order, please.

Hon. Peter Van Loan (Leader of the Government in the House of Commons and Minister for Democratic Reform, CPC):

Mr. Speaker, I will tell the member what the members from Atlantic Canada did. They fought hard for the best possible benefits for their province and the result was the following: For Nova Scotia, under the fiscal balance package, more than $2.4 billion and $1.3 billion for equalization; $130 million for offshore accord offsets; $639 million on the Canada health and social transfer; $277 million under the Canadian social transfer; $42.5 million for the environment; and there is more and more.

Those members are delivering for Nova Scotians and for Atlantic Canadians. They are standing up in the way the Liberal Party always refused to do.

Hon. Robert Thibault (West Nova, Lib.):

Mr. Speaker, when I first asked the member for Central Nova to honour the Atlantic accord he said that he would see the Province of Nova Scotia in court.

Last night one brave Conservative member voted in favour of Nova Scotia and was kicked out of that caucus.

On May 15, the minister said in the House:

We will not throw a member out of caucus.... There will be no whipping, flipping, hiring or firing on budget votes....

Is the minister from Nova Scotia misleading the House, or is he simply a buffoon or is he a misleading buffoon?

Hon. Jim Flaherty (Minister of Finance, CPC):

Mr. Speaker, that question comes from a member of a party, the leader of which says that fiscal imbalance is a myth. Therefore, whatever that party has to say about equalization does not really matter because the leader of the party himself says that there is no fiscal imbalance.

Hon. Ralph Goodale:

You broke your promise and you broke your word.

Hon. Jim Flaherty:

I know the member for Wascana wishes that his leader had not said that but he did say that. He said that the fiscal imbalance was a myth.

We are fixing the fiscal imbalance--

The Speaker:

Order, please. The hon. member for West Nova.

Hon. Robert Thibault (West Nova, Lib.):

Mr. Speaker, the Prime Minister broke his promise to Nova Scotians.

The so-called minister from Nova Scotia broke his word to a brave MP. The so-called minister from Nova Scotia values his cabinet seat more than his own province.

I would ask the hon. member for Central Nova what loyalty means. Were those not his words? Why can he not stand up for Nova Scotia? Is it because he cannot or because he will not? Will he resign as the minister irresponsible for Nova Scotia?

Hon. Jim Flaherty (Minister of Finance, CPC):

Mr. Speaker, personal attacks like that always say more about the person saying them than about the person receiving them. It is unattractive, I must say, to have those kinds of personal attacks here.

However, on equalization--

Some hon. members: Oh, oh!

Hon. Ralph Goodale:

Look in the mirror, Jim.

The Speaker:

Order, please. The Minister of Finance has the floor and we will have a little order, please.

Hon. Jim Flaherty:

Mr. Speaker, the Province of Nova Scotia has the option of electing the new system, the modified O'Brien system, this year or continuing with the Atlantic accords. The province has chosen, for this year at least, to elect the new modified O'Brien system.

What that means for the province in terms of transfers in budget 2007 is $256 million more than in the previous fiscal year. That is good for--

The Speaker:

The hon. member for Labrador.

* * *

Atlantic Accord

Mr. Todd Russell (Labrador, Lib.):

Mr. Speaker, the ranks of Atlantic Conservative dissenters keeps growing. First it was Progressive Conservative premiers, then a list of Conservative candidates condemned the attack on the Atlantic accords and then those Conservatives booted out one of their own after last night's vote.

Now John Crosbie, a Progressive Conservative, has been added to the growing list with a blistering memo proving that the finance minister betrayed my province and Atlantic Canada.

Those Conservatives are like jellyfish: totally spineless, no backbone and sting us when they can.

How can the former Progressive Conservative ministers continue to sit in that caucus and represent their provinces?

Hon. Jim Flaherty (Minister of Finance, CPC):

Mr. Speaker, it goes without saying that we have the greatest respect for Mr. Crosbie, who was a Progressive Conservative minister of finance in this place. I had the opportunity to speak with him about these issues during the course of the past several months and we value and respect his views.

However, in terms of Newfoundland and Labrador and Nova Scotia, which have accord agreements, the plain fact is that those accord agreements are the status quo agreements which they can choose to continue with or they can go with the modified O'Brien formula. However, no province will be worse off in Canada as a result of the new equalization scheme.

Mr. Todd Russell (Labrador, Lib.):

Mr. Speaker, last night, the newly independent member from Nova Scotia did the right thing and stood up for his province and his region. He voted with the Liberal Party and against the Atlantic accord betrayal. His five former colleagues from Newfoundland and Labrador and Nova Scotia fell in line with their bully boss, the Prime Minister, and voted, not just with their own party but with the separatists.

We had problems with harp seals and now we have problems with trained seals.

With one more vote to go, will Conservative ministers and members from Atlantic Canada finally stand up for their constituents and their province?

Hon. Loyola Hearn (Minister of Fisheries and Oceans, CPC):

Mr. Speaker, let me remind the hon. member and the House that it was a Tory government, a Conservative government, that gave us the original Atlantic accord. Let me remind him that it was a Tory opposition that forced the Liberals, including some of them sitting there, to get the second Atlantic accord. Let me also remind him that while they are sitting, sniping from the sidelines, like the Premier of Newfoundland, we are working to deliver to our provinces.

* * *

Mr. Bill Casey (Cumberland—Colchester—Musquodoboit Valley, Ind.):

Mr. Speaker, the Minister of Fisheries just said that they are trying to solve the problem. It is an easy problem to solve and I would like to make it easier for him. All he has to do is say that the Government of Canada will honour the contract signed by the Government of Canada.

It is a signed, sealed and delivered contract. It is a 12 year contract. We are two years into it. Consequential amendments to the budget by the Minister of Finance change the Atlantic accord.

Will the minister now just say, “It is all over. We will honour the signature of the Government of Canada. We will honour the Atlantic accord exactly the way it was written, no amendments. We will honour the work of John Hamm”.

Hon. Jim Flaherty (Minister of Finance, CPC):

Mr. Speaker, as the hon. member knows, he and I have had many discussions on this subject.

Budget 2007 provides Nova Scotia flexibility and more money, as well as respecting the Atlantic accords and giving the province of Nova Scotia the opportunity to make an election. In fact, the province was concerned initially, after March 19, that its budget was coming up that Friday and asked for more time to consider the matter, which we have done. The province has since elected to enter into the agreement for one year to have more opportunities to consider it.

These are worthwhile considerations and at the present benefit—

See:

Casey Up To Bat



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