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Alberta

Is Canada’s Federation Fair?

Published

3 months ago

6 minute read

The Audit David Clinton

Contrasting the principle of equalization with the execution

Quebec – as an example – happens to be sitting on its own significant untapped oil and gas reserves. Those potential opportunities include the Utica Shale formation, the Anticosti Island basin, and the Gaspé Peninsula (along with some offshore potential in the Gulf of St. Lawrence).

So Quebec is effectively being paid billions of dollars a year to not exploit their natural resources. That places their ostensibly principled stand against energy resource exploitation in a very different light.

You’ll need to search long and hard to find a Canadian unwilling to help those less fortunate. And, so long as we identify as members of one nation¹, that feeling stretches from coast to coast.

So the basic principle of Canada’s equalization payments – where poorer provinces receive billions of dollars in special federal payments – is easy to understand. But as you can imagine, it’s not easy to apply the principle in a way that’s fair, and the current methodology has arguably lead to a very strange set of incentives.

According to Department of Finance Canada, eligibility for payments is determined based on your province’s fiscal capacity. Fiscal capacity is a measure of the taxes (income, business, property, and consumption) that a province could raise (based on national average rates) along with revenues from natural resources. The idea, I suppose, is that you’re creating a realistic proxy for a province’s higher personal earnings and consumption and, with greater natural resources revenues, a reduced need to increase income tax rates.

But the devil is in the details, and I think there are some questions worth asking:

  • Whichever way you measure fiscal capacity there’ll be both winners and losers, so who gets to decide?
  • Should a province that effectively funds more than its “share” get proportionately greater representation for national policy² – or at least not see its policy preferences consistently overruled by its beneficiary provinces?

The problem, of course, is that the decisions that defined equalization were – because of long-standing political conditions – dominated by the region that ended up receiving the most. Had the formula been the best one possible, there would have been little room to complain. But was it?

For example, attaching so much weight to natural resource revenues is just one of many possible approaches – and far from the most obvious. Consider how the profits from natural resources already mostly show up in higher income and corporate tax revenues (including income tax paid by provincial government workers employed by energy-related ministries)?

And who said that such calculations had to be population-based, which clearly benefits Quebec (nine million residents vs around $5 billion in resource income) over Newfoundland (545,000 people vs $1.6 billion) or Alberta (4.2 million people vs $19 billion). While Alberta’s average market income is 20 percent or so higher than Quebec’s, Quebec’s is quite a bit higher than Newfoundland’s. So why should Newfoundland receive only minimal equalization payments?

To illustrate all that, here’s the most recent payment breakdown when measured per-capita:
Equalization 2025-26 – Government of Canada

For clarification, the latest per-capita payments to poorer provinces ranged from $3,936 to PEI, $1,553 to Quebec, and $36 to Ontario. Only Saskatchewan, Alberta, and BC received nothing.

And here’s how the total equalization payments (in millions of dollars) have played out over the past decade:

Is energy wealth the right differentiating factor because it’s there through simple dumb luck, morally compelling the fortunate provinces to share their fortune? That would be a really difficult argument to make. For one thing because Quebec – as an example – happens to be sitting on its own significant untapped oil and gas reserves. Those potential opportunities include the Utica Shale formation, the Anticosti Island basin, and the Gaspé Peninsula (along with some offshore potential in the Gulf of St. Lawrence).

So Quebec is effectively being paid billions of dollars a year to not exploit their natural resources. That places their ostensibly principled stand against energy resource exploitation in a very different light. Perhaps that stand is correct or perhaps it isn’t. But it’s a stand they probably couldn’t have afforded to take had the equalization calculation been different.

Of course, no formula could possibly please everyone, but punishing the losers with ongoing attacks on the very source of their contributions is guaranteed to inspire resentment. And that could lead to very dark places.

Note: I know this post sounds like it came from a grumpy Albertan. But I assure you that I’ve never even visited the province, instead spending most of my life in Ontario.

1

Which has admittedly been challenging since the former primer minister infamously described us as a post-national state without an identity.

2

This isn’t nearly as crazy as it sounds. After all, there are already formal mechanisms through which Indigenous communities get more than a one-person-one-vote voice.

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Alberta

Calgary taxpayers forced to pay for art project that telephones the Bow River

Published on June 20, 2025

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From the Canadian Taxpayers Federation

The Canadian Taxpayers Federation is calling on the City of Calgary to scrap the Calgary Arts Development Authority after it spent $65,000 on a telephone line to the Bow River.

“If someone wants to listen to a river, they can go sit next to one, but the City of Calgary should not force taxpayers to pay for this,” said Kris Sims, CTF Alberta Director. “If phoning a river floats your boat, you do you, but don’t force your neighbour to pay for your art choices.”

The City of Calgary spent $65,194 of taxpayers’ money for an art project dubbed “Reconnecting to the Bow” to set up a telephone line so people could call the Bow River and listen to the sound of water.

The project is running between September 2024 and December 2025, according to documents obtained by the CTF.

The art installation is a rerun of a previous version set up back in 2014.

Emails obtained by the CTF show the bureaucrats responsible for the newest version of the project wanted a new local 403 area code phone number instead of an 1-855 number to “give the authority back to the Bow,” because “the original number highlighted a proprietary and commercial relationship with the river.”

Further correspondence obtained by the CTF shows the city did not want its logo included in the displays, stating the “City of Calgary (does NOT want to have its logo on the artworks or advertisements).”

Taxpayers pay about $19 million per year for the Calgary Arts Development Authority. That’s equivalent to the total property tax bill for about 7,000 households.

Calgary bureaucrats also expressed concern the project “may not be received well, perceived as a waste of money or simply foolish.”

“That city hall employee was pointing out the obvious: This is a foolish waste of taxpayers’ money and this slush fund should be scrapped,” said Sims. “Artists should work with willing donors for their projects instead of mooching off city hall and forcing taxpayers to pay for it.”

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Alberta

Second body recovered from Bow Glacier Falls rockslide. Police identify first victim

Published on June 20, 2025

By

News release from the RCMP and Parks Canada

Parks Canada and RCMP continue to respond to a rockslide at Bow Glacier Falls near Bow Lake, approximately 37 km north of Lake Louise in Banff National Park. Search and rescue operations resumed at 6:30 am on June 20, 2025.

RCMP confirm that the individual located deceased at the scene on June 19, 2025, was a 70-year-old female resident of Calgary, Alberta. RCMP also confirm that a second deceased individual was recovered on the morning of June 20, 2025. RCMP is notifying their next of kin and no further information is available at this time. Three individuals transported to hospital by STARS and ground ambulance on June 19, 2025 were all in stable condition at last report.

At this time, there are no additional persons reported missing and no additional unidentified vehicles at the trailhead located at Bow Lake.

Parks Canada and RCMP extend our deepest condolences to the families and friends of the two individuals who lost their lives, our hearts are with them. Our thoughts also remain with those in hospital and we hope for their full recovery.

In a continued effort to complete a thorough assessment, Parks Canada visitor safety teams continue work today with support from a geotechnical engineer with Canada Task Force One (CAN-TF1 Vancouver), as well as members of Canada Task Force Two (CAN-TF2 Calgary) and their partners in the Calgary Police Service.

The safety of first responders and park visitors is our top priority.

Bow Lake and the trail to Bow Hut have reopened. Bow Glacier Falls remains closed to all visitors. The NOTAM (no-fly zone) remains in place to ensure public safety and for park operations. Parks Canada and RCMP thank visitors for giving teams space to work safely.

The Icefields Parkway (Highway 93N) remains open with potential intermittent, short-term traffic stoppages in the vicinity of the incident. Heavy precipitation including snow is occurring on the Icefields Parkway. Please check the weather forecast and Alberta 511 before travelling.

Banff National Park remains open and safe to visit.

Updates will be provided as more information is available.

 

BACKGROUND:

 RCMP AND PARKS CANADA – JOINT STATEMENT #2

June 20, 2025 8:10 AM

Lake Louise, Alberta – On June 19, 2025, at 1 pm Parks Canada received a report of a serious rockfall at Bow Glacier Falls located west of the Icefields Parkway (Highway 93N) near Bow Lake, which is approximately 37 km north of Lake Louise in Banff National Park.

Parks Canada wardens and RCMP remained on site overnight. Parks Canada visitor safety teams will continue working today with support from Canada Task Force Two (CAN-TF2 Calgary), a national disaster response team.

CAN-TF2 is conducting infrared flights, through their partners in the Calgary Police Service, in a continued effort to complete a thorough assessment. A Canada Task Force One (CAN-TF1 Vancouver) geotechnical engineer will conduct a slope stability assessment. The safety of first responders and park visitors is our top priority.

As reported yesterday, one person was located deceased at the location on June 19th. RCMP are working to notify next of kin. No further information about this individual is available.

Bow Lake remains closed to all visitors. A NOTAM (no-fly zone) remains in place to ensure public safety and for park operations. Parks Canada and RCMP thank visitors for giving teams space to work safely.

Alpine Club of Canada guests staying at Bow Hut are safe. Visitors staying at Bow Hut will be able to exit on schedule via the usual route, which is unaffected and safe to travel.

The Icefields Parkway (Highway 93N) remains open with potential intermittent, short-term traffic stoppages in the vicinity of the incident. Heavy precipitation including snow occurring on the Icefields Parkway. Please check the weather forecast and Alberta 511 before travelling.

Banff National Park remains open and safe to visit.

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