Alberta Elections: Referendum on Paying Equalization on the Agenda

TORONTO – As the polls for Alberta’s municipal election close to completion, voters in the province have also had the opportunity to express their views on federal equalization payments.

In a referendum in the province, Monday’s ballot includes the question: “If section 36 (2) of the Constitution Act, 1982 – the commitment of the Parliament and the Government of Canada to the principle of equalization payments – should be removed from the Constitution? “

Albertans are also asked for their opinion on daylight saving time, while a plebiscite in Calgary asks voters if the city should reintroduce fluoride into the water supply.

Equalization payments, an often controversial topic in Alberta, refer to the tax money that the federal government redistributes to low-income provinces, based on per capita income, so that all provinces can provide a similar level of services. public.

Some Alberta political leaders, such as Premier Jason Kenney, have long disputed that these payments take money away from them to return to Quebec as that province opposes pipeline development.

In a public letter released last week, Alberta Finance Minister Travis Toews estimated the provincial contribution at $ 20 billion per year.

While this referendum will not eliminate those payments – it would require a constitutional change – politicians in favor of the “yes” vote believe that strong enough support will force the federal government to renegotiate equalization.

“(This) is not a matter of partisan politics,” Kenney told reporters on several occasions in recent days. “It’s a question of whether or not Alberta needs to push hard to get a fair deal. “

“The goal is to gain leverage for constitutional negotiations with the federal government on reforming the entire system of fiscal federalism, which treats Alberta so unfairly.

Calgary outgoing mayor Naheed Nenshi, who is not running for re-election, urged Albertans Vote Against Kenny’s ‘Ridiculous’ Referendums, “on principle if nothing else.”

Jared Wesley, a political scientist at the University of Alberta, told The Canadian Press that a recent poll suggests the “Yes” side is ahead, although many Albertans do not understand how Equalization works and believe to many of the misconceptions surrounding the program.

“I don’t blame Albertans for being confused,” he said. “They have been fueled by a lot of misinformation from the governments of this province for many decades, and it shows in our research. “

He noted that the federal government had spent a lot of money to help Alberta’s economy by purchasing the Trans Mountain pipeline, and more recently sending military aid as the province’s health care system crumbled under pressure. of COVID-19.

With files from The Canadian Press


Bill Fortier

Alberta Bureau Chief, CTV National News

When Albertans walked to their polls today, they voted for more than mayors, councilors and school trustees.

The ballot was spread over two pages. In addition to the usual boxes to tick, voters were asked to weigh in on several issues. One of them was equalization, in a so-called referendum question:

Should subsection 36 (2) of the Constitution Act, 1982 – the commitment of the Parliament and the Government of Canada to the principle of equalization payments – be deleted from the Constitution?

If you are confused by this question, you are not alone.

In fact, a recent poll by Common Ground, a University of Alberta group, found that very few Albertans actually understand the federal program. It consisted of eight true or false questions, designed to test basic knowledge of the Equalization program. The average respondent scored 3.1 out of eight.

Equalization has been vilified by the UCP government of Alberta, led by Premier Jason Kenney. It often boils down to a simplistic understanding that Alberta gives money to the so-called “have-not” provinces. But this is not entirely correct.

This is my attempt to explain the equalization:

The federal government makes money from the federal taxes paid by all Canadians. These are income tax, corporation tax and GST. A portion of these taxes goes into a fund and is remitted to provincial governments that are unable to provide a basic level of services, for an average level of taxation. These are the “have-nots” provinces. A person earning $ 100,000 per year in Ontario pays the same federal taxes as a person earning $ 100,000 in Alberta and, therefore, contributes the same amount to the program.

The argument for Alberta to pay more is that, on average, Albertans earn more money and therefore pay more taxes. Thus, the average Albertan would pay a little more than the average Canadian to participate in the program. Of course, the same could be said for any federal program funded by federal taxes.

However, Alberta’s federal taxes represent only about 15 percent of the total cash transported by Ottawa each year. In fact, federal taxes paid by Canadians outside of Alberta actually fund 85% of the economy. 100 of the program.

Critics of Equalization in Alberta have lamented that even when times are tough, Alberta does not receive equalization payments. It is true that Alberta has not been at all poor of the equation since the mid-1960s. Of course, this is because even when the economy of Alberta has cooled, it is. still one of the hottest provincial economies in the country. So essentially, a weak Alberta economy still makes more money per capita, at very low tax rates, than most Canadian provinces.

More importantly, the results of the referendum question will have no direct or immediate impact. Simply put, Alberta does not have the power to cut a federal program.

Premier Kenney has suggested that a ‘yes’ result might help him pressure Ottawa to give Alberta a better deal in the equalization formula, perhaps even some form of rebate when times are bad here. And maybe it will be. But the chances of the federal government getting rid of a constitutionally protected program that has existed since the late 1950s are slim to say the least.

About Kristina McManus

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