GUNTER: Quebec’s love of equalization and hatred of oil pipelines

Give Quebec Premier Francois Legault credit for getting one thing right: Alberta cannot change the formula for equalization payments on its own.
On Saturday, Alberta Premier Jason Kenney repeated his party’s promise to hold a referendum on the federal scheme that siphons billions of dollars annually from “have” provinces (with the bulk coming from Alberta) to “have-not” provinces such as Quebec (which is by far the biggest receiver). The UCP’s equalization vote would be in October 2021.The date is dependent on whether the federal government makes changes before that to how equalization is calculated and whether Ottawa starts using its constitutional power to get pipelines built. Since Quebec loves (no, LOVES) equalization and HATES oil pipelines, there is almost no chance of action on either front so long as there is a Liberal government in Ottawa. Thus the likelihood of an Alberta referendum a little more than two years from now seems a foregone conclusion. 

The day after Kenney renewed his promise to hold an equalization referendum, Legault went on an error-laced rant about the origins of equalization.Legault said no province has the power to change how equalization is calculated or what amounts Ottawa takes from one region and gives to another.Correct.But it goes downhill from there.

Legault insisted equalization has “been in the Constitution since Day 1 of Canada.” Um, no. Day 1 would be July 1, 1867. Equalization has only been in the Constitution since 1982 – 115 years after the fact.

And, as Kenney pointed out on Monday, Quebec refused to sign the 1982 version of our Constitution. So, technically, Quebec has never formally endorsed the principle of equalization, even though it receives $13 billion a year in equalization payments or roughly half the total Ottawa pays out.

Legault insisted, “When Quebec got into Canada, equalization was in the plan. It is part of the original deal. We can’t change the original deal.” Wrong again.Equalization didn’t even appear as a federal program (much less a Constitutional amendment) until 1957. And although it has been in the Constitution for nearly 40 years, no amounts or percentages are specified. It could be greatly reduced and still be legal.Here’s another little fact about equalization: With the possible exception on Prince Edward Island, not a single one of the six have-not provinces that currently receive payments would qualify for subsidies under the plan’s original rules.When equalization was brought in 62 years ago, most of the province’s that received money had per capita GDPs that were less than 70 per cent of the “have” provinces’. Now, they all have per capita GDPs north of 85 per cent of the national average. And most (Quebec included) are better than 90 per cent.

The rules had been rigged and re-rigged numerous times to make sure none of the have-nots lose their federal largesse and so none of their voters turn on the party in power.(To be fair, when the federal Conservatives are in office, they have as much trouble taking equalization away as the Liberals do.)Of course, the real outrage of equalization is that while Quebec loves Alberta’s money, it actively opposes the pipelines (such as Energy East) needed to get our oil to market so we can afford to contribute to equalization. Indeed, Legault infamously said in April that there was “no social acceptability” in his province for “dirty energy” from Alberta.Even during the depths of our recent recession, Alberta was still a net contributor to Confederation to the tune of about $20 billion a year.

Yet what was Legault’s response to these glaring hypocrisies with equalization?

“We are entitled to equalization, there is no question of adjusting or changing it”


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